**Netflix Stock Valuation and Performance Insights**
As of now, Netflix (NFLX) shares are deemed overvalued with a forward 12-month price/sales (P/S) ratio of 7.3, significantly higher than the Zacks Consumer Discretionary sector’s average of 2.31. When compared to peers, Disney (DIS) trades at 1.65, Paramount Skydance (PSKY) at 0.34, and Amazon (AMZN) at 2.69. Year-to-date, Netflix shares have decreased by 3%, outpacing the sector’s decline of 7.9%, while competitors like Amazon and Disney have seen declines of 10.2% and 15.2%, respectively.
In terms of financials, Netflix reported a cash balance of $9.03 billion against total debt of $14.52 billion as of December 31, 2025, with streaming content obligations amounting to $24.04 billion. The company generated $10.1 billion in net cash from operating activities in 2025, and non-GAAP free cash flow is projected to reach approximately $11 billion in 2026. Lastly, Netflix anticipates revenue for 2026 to fall between $50.7 billion and $51.7 billion—a growth rate reduction from 2025—while targeting an operating margin of 31.5%.
