Netflix, Inc. (NFLX) Stock Recommendation | Score, Valuation, Technicals & Financial Trend

Score

Click here to find our call on this stock

Strong Sell

Sell

Hold

Buy

Strong Buy

Comparison

Company

Score

Quality

Valuation

Financial

Technical

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Netflix, Inc.

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Zscaler, Inc.

Akamai Technologies, Inc.

MSCI, Inc.

Why is Netflix, Inc. ?

High Management Efficiency with a high ROCE of 26.39%

Strong ability to service debt as the company has a low Debt to EBITDA ratio of 0.37 times

Healthy long term growth as Net Sales has grown by an annual rate of 12.61% and Operating profit at 23.96%

The company has declared Positive results for the last 8 consecutive quarters

OPERATING CASH FLOW(Y) Highest at USD 10,149.27 MM
NET SALES(Q) Highest at USD 12,139.95 MM
RAW MATERIAL COST(Y) Fallen by -6.77% (YoY)

With ROCE of 41.33%, it has a very expensive valuation with a 12.59 Enterprise value to Capital Employed

The stock is trading at a discount compared to its peers' average historical valuations
Over the past year, while the stock has generated a return of -1.27%, its profits have risen by 26.1%

High Institutional Holdings at 76.85%

These investors have better capability and resources to analyse fundamentals of companies than most retail investors.

Underperformed the market in the last 1 year

Even though the market (S&P 500) has generated returns of 14.90% in the last 1 year, the stock has hugely underperformed and has generate negative returns of -1.27% returns

Real-Time Research Report

Verdict Report

How much should you hold?

Overall Portfolio exposure to Netflix, Inc. should be less than 10%
Overall Portfolio exposure to Computers - Software & Consulting should be less than 30%

(If sector exposure > 30%, please use optimiser tool to see which are the best stocks to hold in Computers - Software & Consulting)

When to exit? - We will constantly monitor the company and suggest at the appropriate time to exit from the stock

Is Netflix, Inc. for you?

High Risk, Low Return

Absolute

Risk Adjusted

Volatility

Netflix, Inc.

0.41%

-0.89

96.56%

S&P 500

14.9%

0.77

19.29%

Quality

Management Risk

Growth

Capital Structure

Quality grade scale :

Below Average, Average, Good, Excellent

Quality key factors

Factor

Value

Sales Growth (5y)

12.61%

EBIT Growth (5y)

23.96%

EBIT to Interest (avg)

9.85

Debt to EBITDA (avg)

0.37

Net Debt to Equity (avg)

0.29

Sales to Capital Employed (avg)

0.99

Tax Ratio

12.26%

Dividend Payout Ratio

Pledged Shares

Institutional Holding

76.85%

ROCE (avg)

26.39%

ROE (avg)

29.13%

Valuation

Valuation Scorecard

Valuation grade scale :

Very Risky, Risky, Very Expensive, Expensive, Fair, Attractive, Very Attractive

Valuation Key Factors

Factor

Value

P/E Ratio

Industry P/E

Price to Book Value

15.14

EV to EBIT

30.46

EV to EBITDA

13.55

EV to Capital Employed

12.59

EV to Sales

9.03

PEG Ratio

Dividend Yield

ROCE (Latest)

41.33%

ROE (Latest)

41.26%

Technicals

Technical key factors

Indicator

Weekly

Monthly

MACD

Mildly Bullish

Mildly Bearish

RSI

No Signal

Bollinger Bands

Bearish

Moving Averages

Mildly Bearish (Daily)

KST

Mildly Bullish

Mildly Bearish

Dow Theory

Mildly Bearish

Mildly Bullish

OBV

Mildly Bearish

Technical Indicator Scale: Bearish, Mildly Bearish, Sideways, Mildly Bullish, Bullish Turned

Technical Movement

Analyse All Technical Factors

Financial Trend

Financial Trend Scorecard

Financial Trend scale:

Very Negative, Negative, Flat, Positive, Very Positive, Outstanding

8What is working for the Company

OPERATING CASH FLOW(Y)

Highest at USD 10,149.27 MM

NET SALES(Q)

Highest at USD 12,139.95 MM

RAW MATERIAL COST(Y)

Fallen by -6.77% (YoY

DEBT-EQUITY RATIO (HY)

Lowest at 29.71 %

OPERATING PROFIT(Q)

Highest at USD 7,897.17 MM

-4What is not working for the Company

DEBTORS TURNOVER RATIO(HY)

Lowest at 19.81 times

INTEREST(Q)

Highest at USD 234.4 MM

Here's what is working for Netflix, Inc.

Operating Cash Flow

Highest at USD 10,149.27 MM and Grown

In each year in the last three years

MOJO Watch

The company has generated higher cash revenues from business operations

Operating Cash Flows (USD MM)

Net Sales

Highest at USD 12,139.95 MM and Grown

In each period in the last five periods

MOJO Watch

Near term sales trend is very positive

Net Sales (USD MM)

Operating Profit

Highest at USD 7,897.17 MM

in the last five periods

MOJO Watch

Near term Operating Profit trend is positive

Operating Profit (USD MM)

Debt-Equity Ratio

Lowest at 29.71 %

in the last five Semi-Annual periods

MOJO Watch

The company has been reducing its borrowing as compared to equity capital

Debt-Equity Ratio

Raw Material Cost

Fallen by -6.77% (YoY)

MOJO Watch

The company's ability to pass on the cost of raw materials to customers has improved; this may lead to a rise in profit margin

Raw Material Cost as a percentage of Sales

Depreciation

Highest at USD 4,850.22 MM

in the last five periods

MOJO Watch

The expenditure on assets done by the company may have gone into operation

Depreciation (USD MM)

Here's what is not working for Netflix, Inc.

Interest

At USD 234.4 MM has Grown at 33.72%

period on period (QoQ)

MOJO Watch

Rising interest cost signifies increased borrowings

Interest Paid (USD MM)

Interest

Highest at USD 234.4 MM

in the last five periods and Increased by 33.72% (QoQ)

MOJO Watch

Rising interest cost signifies increased borrowings

Interest Paid (USD MM)

Debtors Turnover Ratio

Lowest at 19.81 times

in the last five Semi-Annual periods

MOJO Watch

Company's pace of selling Debtors has slowed

Debtors Turnover Ratio