Opinions Stockchase Insights
Netflix Inc.NFLXHOLDDec 17, 2025
Stockchase InsightsStock price when the opinion was issued
As of Nov 11, 2026. Market Open.
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Streaming industry has become much more competitive. Difficulty maintaining a consistent, ongoing subscriber base (rather than intermittent), which also affects advertiser interest. Wait to see action on this issue before committing more $$.
Disclaimer: Not owned in segregated client accounts. However, her colleague John O'Connell owns it in the equity fund that he manages.
It's had a rough year, following the failed Warners bid. He still likes it, because the business is performing quite well. They have more subscribers and revenues outside the U.S. where they have little competition and are growing rapidly. Also, they replaced the head of content, and are looking to ad sports. Lots of ways to improve growth ahead.
(Analysts’ price target is $86.35)
The fundamentals are as good or better as people have hoped. But there are worries that people are watching YouTube and no longer Netflix, but this is not in the numbers. These things reverse very quickly. Look at Google's stock. He thinks Netflix will grow at double digits for many years.
Barry Schwartz
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Premium contentNetflix plans to accelerate growth in live entertainment. It currently spends 5% of its annual $20 billion content budget on it, though attracts 1% of viewership. Overall content spending is up from $24 billion in 2025 to $25.1 billion in the first half of this year alone. The spending will squeeze cash flow, but new content will attract viewers in an ever-competitive industry. As for the share price, it's been brutal, plunging from its spring highs around $108 to a current bottom of $67 to match level from late July. Yes, Netflix faces challenges, but it has too many good numbers to dismiss. Time to bottom-feed.
There are two big streaming companies, Netflix and YouTube. Netflix should be able to increase its subscriber growth by diversifying its business into sports, etc. There is an uptick on their paids. It does a lot of its own content and buys content very easily. You can buy at these levels.
NFLX has emerged as essentially the clear winner in the streaming space. A few years ago, this statement was not as clear, as competitors like DIS, AMZN, were potential peers to NFLX in the space, but it is now clear that NFLX has a strong moat around its platform. Sales and earnings growth are expected to trend higher, analyst estimates are rising, and margins are expanding. It generates strong free cash flow and mostly repurchases shares with its cash flows. It trades at a reasonable valuation of 31X forward earnings. We feel that in a consumer slowdown scenario, cutting streaming platforms is one of the first places that consumers look at, and this is one of the biggest risks for the name, but over a long period of time, we think this name has a lot of potential.
With the WBD bros deal we think NFLX becomes a powerhouse in the streaming space, without the WBD deal, we think it can continue to do well, but it will need to refocus on organic growth and balance sheet strength. Short-term the stock may fluctuate if the deal goes through, but we think it is positive for the stock long-term.
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