Netflix Outperforms Market with Impressive Financials and Growth Outlook

With a market cap of $485.2 billion, Netflix, Inc. (NFLX) stands as a leading provider of entertainment services. The company is involved in acquiring, licensing, and producing content, which includes original programming. Netflix offers paid memberships in over 190 countries, providing a diverse array of television series, documentaries, feature films, and games across various genres and languages.

Over the past 52 weeks, NFLX shares have significantly outperformed the broader market. NFLX’s stock has surged by 86.3%, while the S&P 500 Index ($SPX) has increased by just 8.6%. Furthermore, year-to-date (YTD), NFLX shares have risen by 27.9%, contrasting sharply with the SPX, which has seen a 3.8% decline.

Diving deeper, the Los Gatos, California-based company has also eclipsed the Communication Services Select Sector SPDR ETF Fund (XLC), which increased nearly 19% over the past year, alongside a modest YTD return.

Following its Q1 2025 results released on April 17, Netflix’s stock rose 1.5%. The company reported a revenue increase of 12.5% year-over-year, totaling $10.5 billion, fueled by substantial growth in both subscription and advertising revenue. Operating income rose by 27.1% from the previous year to $2.9 billion, achieving an operating margin of 31.7%. Earnings per share (EPS) reached $6.61, reflecting a 25.2% rise from the same quarter last year.

For fiscal 2025, Netflix anticipates revenue between $43.5 billion and $44.5 billion, driven by expected member growth, higher subscription prices, and approximately double the advertising revenue.

Analysts project that the EPS for the fiscal year ending in December 2025 will increase by 27.7% year-over-year, rising to $25.33. The company’s earnings history supports this optimism, having exceeded consensus estimates in the past four quarters.

Among the 45 analysts covering NFLX, the consensus rating is a “Moderate Buy.” This assessment is based on 30 “Strong Buy” ratings, two “Moderate Buys,” and 13 “Holds.” This configuration indicates increased optimism compared to three months ago, where there were 27 “Strong Buy” ratings.

On April 21, Evercore ISI raised NFLX’s price target to $1,150 while maintaining an “Outperform” rating. Currently, Netflix trades above the mean price target of $1,088.27. The highest price target of $1,514 suggests a potential upside of 32.8% from current pricing.

On the date of publication, Sohini Mondal did not hold (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data are for informational purposes. For more information, please view the Barchart Disclosure Policy here.

The views and opinions expressed herein are solely those of the author and do not necessarily reflect those of Nasdaq, Inc.