Netflix, Inc. (NFLX)
Netflix continues to benefit from subscription durability, pricing power, and a developing ad opportunity, but the current share price leaves less room for execution misses.
This page preserves the published note at the report date shown below. For the live workspace with the latest price context, filing updates, refreshed normalized statements, and current model output, return to the company page.
Live reference context
These cards show the latest live reference data beside the published note. The written note and published rating remain anchored to the report date above.
Current model signal
Hold
Confidence
Low
Current price
$1,080
Latest analyst action
Downgraded
Mar 19, 2026
Latest published rating
Sell
Mar 19, 2026
Fair value
$1,081
Upside / Downside
+0.1 upside
Model vs published view
Current model signal differs from the latest published analyst rating.
Current price data
AnalystScope curated current price
Live market-price fetch unavailable. Using the curated current price field.
Latest filing / report
4 filed Apr 3, 2026 | Reporting period Apr 2, 2026
Last refreshed Apr 3, 2026, 11:28 PM UTC. Stale after Apr 4, 2026, 11:28 AM UTC.
Open filing sourceReported fundamentals
SEC XBRL companyfacts API
Live SEC companyfacts currently cover revenue, operating margin, free cash flow, and net cash / net debt. Reporting period end 2025-12-31.
Last refreshed 3 Apr 2026, 21:01 UTC. Stale after 4 Apr 2026, 09:01 UTC.
Analyst summary
Netflix continues to benefit from subscription durability, pricing power, and a developing ad opportunity, but the current share price leaves less room for execution misses.
Why this view
- Valuation sits close to fair value, keeping the view balanced.
- Operating trends show +15.9% revenue growth with 29.4% operating margin.
- Cash-flow quality shows 21.0% FCF margin.
- Balance sheet carries net debt of $4.4B, equal to 9.7% of revenue.
What to watch
Whether advertising matures into a larger, more predictable contributor to revenue growth.
Thesis scorecard
Lightweight qualitative scorecard across the core dimensions shaping the current investment view.
Growth
ModerateGrowth remains healthy, though ad monetization and mature-market penetration still shape the next leg.
Profitability
StrongMargin structure and cash conversion continue to improve as scale deepens.
Balance sheet
ModerateLeverage is improving, but the balance sheet is still less conservative than cash-rich peers.
Valuation
WeakThe shares already price in a lot of execution and monetization success.
Execution / Resilience
StrongGlobal scale and product execution remain clear strengths.
Bull / Base / Bear scenarios
Bull case value
$1,238
Stronger execution and valuation support than the base case.
Base case value
$1,081
This is the main recommendation anchor used on the public company page.
Bear case value
$942
Weaker assumptions or lower multiple support than the base case.
Base-case assumptions
These are the published base-case assumptions behind the note. They are reasoned valuation inputs at the report date, not reported facts, and the note under each number explains why that level was used in the base case.
Revenue CAGR (5Y)
12.0%
±1.0% => ±$22/sh
Why this level: This is AnalystScope's base-case growth assumption, not a guarantee. It sits below the latest normalized FY revenue pace (2025.0%), so the model does not extend current strength too far into the outer years. Current company context: Subscription resilience and pricing power continue to underpin revenue durability.
Terminal Growth
2.5%
±0.5% => ±$15/sh
Why this level: This is AnalystScope's mature long-run growth assumption, not a perpetual hypergrowth claim. At 2.5%, it sits well below the 12.0% five-year revenue CAGR, so the model steps down from the explicit forecast period to a steadier long-run pace. For Netflix, Inc., that means a durable franchise can keep compounding after year five without assuming today's faster growth profile lasts indefinitely.
WACC
8.9%
±0.5% => ∓$19/sh
Why this level: This is AnalystScope's base-case cost-of-capital judgment, not a precise CAPM output. It reflects the current rates backdrop, equity risk premium, and the company's balance-sheet posture. Leverage declining with stronger cash conversion
Operating Margin (Year 5)
29.0%
±100 bps => ±$11/sh
Why this level: This is AnalystScope's base-case margin view, not a promise of straight-line expansion. It keeps year-five margins close to today's normalized operating margin (29.4%), which implies the current margin structure is broadly durable. Margin input normalizes content amortization swings and quarter-specific release cadence.
How to read the assumptions and sensitivities
These are base-case assumptions used to estimate fair value. They are reasonable model inputs, not reported facts.
Each sensitivity line shows the estimated fair-value-per-share change from a small move in that one input while the other inputs stay fixed.
bps means basis points. 100 bps equals 1.00 percentage point.
WACC sensitivity moves in the opposite direction because a higher discount rate lowers present value, while a lower discount rate raises it.
Model inputs vs reported fundamentals
Side-by-side view of the live reported fundamentals versus the latest normalized annual inputs still used in the current public analysis model.
Reported fundamentals source
SEC XBRL companyfacts API
Live SEC companyfacts currently cover revenue, operating margin, free cash flow, and net cash / net debt. Reporting period end 2025-12-31.
Last refreshed 3 Apr 2026, 21:01 UTC. Stale after 4 Apr 2026, 09:01 UTC.
Normalization impact on the thesis
For Netflix, normalization reduces content-timing distortion and makes the thesis lean more on durable subscriber economics and ad monetization than on any one release slate.
| Metric | Reported | Status | Model input | Status |
|---|---|---|---|---|
| Revenue (TTM) | $45.2B | Live reported | $45.2B +15.9% YoY Adjustment: Model revenue smooths content release timing and the current advertising ramp. | Model / normalized |
| Operating Margin | 29.5% | Live reported | 29.4% +276 bps YoY Adjustment: Margin input normalizes content amortization swings and quarter-specific release cadence. | Model / normalized |
| FCF (TTM) | $9.5B | Live reported | $9.5B 21.0% margin Adjustment: FCF input cleans up content cash timing and other uneven release-related distortions. | Model / normalized |
| Net Cash / (Debt) | ($4.4B) | Live reported | ($4.4B) Leverage declining with stronger cash conversion Adjustment: Balance-sheet treatment keeps leverage conservative even as cash conversion continues to improve. | Model / normalized |
Why this rating
Shares currently trade at $1,080 versus a base-case fair value of $1,081, implying +0.1 upside. That supports a Hold rating with Low confidence under the current model.
Fair value $1,081 vs. current $1,080 (+0.1 upside).
Current price
$1,080
Fair value
$1,081
Upside / Downside
+0.1 upside
Model signal / Confidence
Hold / Low
Confidence framing
Method agreement / dispersion
Valuation methods show a wider range from $965 to $1,191, which tempers conviction.
Margin strength
Operating margin is 29.4%, with +276 bps vs prior FY.
Balance sheet position
Balance sheet positioning currently reflects net debt of ($4.4B), with leverage declining with stronger cash conversion.
Valuation breakdown
| Method name | Implied value | Weight |
|---|---|---|
| DCF (Base) | $1,191 | 45% |
| NTM P/E Multiple | $965 | 35% |
| EV/EBITDA Cross-check | $1,037 | 20% |
Key drivers
Subscription resilience and pricing power continue to underpin revenue durability.
Advertising remains the clearest incremental upside lever beyond the core subscription model.
Improving free cash flow supports both valuation and declining leverage.
Key risks
The current valuation leaves little room for slower ad monetization or weaker engagement.
Content efficiency could deteriorate if hit rates soften or competitive intensity rises.
Mature-market penetration may make future growth more dependent on flawless execution.
What would change our view
Clearer evidence of durable ad monetization would improve the current stance.
Sustained free-cash-flow outperformance could offset some valuation pressure.
A weaker content slate or slower paid-sharing benefits would likely reinforce the downside case.
Near-term catalysts
Ad-tier monetization and engagement trends remain the nearest catalysts for estimate revisions.
Margin commentary tied to content amortization can move the market's confidence quickly.
Subscriber and churn data across mature markets still matter for the long-term growth narrative.
What we are watching
Whether advertising matures into a larger, more predictable contributor to revenue growth.
How content efficiency trends hold up as Netflix scales globally.
Any sign that pricing power is weakening in mature, highly penetrated markets.
Coverage metadata
Last updated
Mar 19, 2026
Coverage status
Active coverage
Latest analyst action
Downgraded
Mar 19, 2026
Latest published rating
Sell
Mar 19, 2026
Analyst note
Current work is centered on ad monetization quality, content efficiency, and whether cash conversion can justify the premium multiple.
Model vs published view
Current model signal differs from the latest published analyst rating.
Current price source
AnalystScope curated current price
Live market-price fetch unavailable. Using the curated current price field.
Reported fundamentals source
SEC XBRL companyfacts API
Live SEC companyfacts currently cover revenue, operating margin, free cash flow, and net cash / net debt. Reporting period end 2025-12-31.
Last refreshed 3 Apr 2026, 21:01 UTC. Stale after 4 Apr 2026, 09:01 UTC.
Latest filing source
SEC EDGAR submissions API
4 filed Apr 3, 2026 | Reporting period Apr 2, 2026
Last refreshed Apr 3, 2026, 11:28 PM UTC. Stale after Apr 4, 2026, 11:28 AM UTC.
Open filing sourceCoverage timeline
Timeline entries reflect published analyst actions and ratings. The current model signal is shown separately above.
Mar 19, 2026
Downgraded to Sell as valuation ran well ahead of our base-case cash-flow assumptions.
Jan 29, 2026
Maintained Hold while operating trends improved but upside remained limited.
Dec 11, 2025
Initiated coverage with a balanced stance on growth durability versus valuation.