Netflix: Is the sky really the limit?

Is Netflix (NFLX +1.3%) already being valuated at the upper bounds of its subscriber and revenue potential, asks SA contributor The Unintelligible Investor?

After crunching the numbers using some fairly generous assumptions (341M global subscribers) going all the way out to 2028, an intrinsic value of $22.5B for Netflix is derived compared to the current market cap of $20.99B.

Though it's hard to knock a NFLX bull off the long-term story, scratching around with the long-term revenue, profit, and subscriber estimates shows  the growth track the company will have to maintain unless pricing or the business model changes dramatically.

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Comments (3)
  • Esekla
    , contributor
    Comments (4469) | Send Message
    This is the first Market Current I've seen posted where the ONLY news is an SA story. I hope it will be the last such instance? I specifically exclude stories from my alerts, and I could easily have made my settings otherwise if I'd wanted.
    26 Nov 2013, 03:22 PM Reply Like
  • BfloC
    , contributor
    Comments (3) | Send Message
    I second that.
    26 Nov 2013, 10:23 PM Reply Like
  • andypochta1
    , contributor
    Comments (1305) | Send Message
    Agree, but great article by The Unintelligible Investor though.
    27 Nov 2013, 10:49 AM Reply Like
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