Netflix (NFLX) could be worth 5+ years from now, and came up with a $80 to $107 Fair Value. Well what do you know, here we are a few months later and the stock’s now surpassed that range and just hit $113.
I don’t own the stock, and have missed this big run, so I am no Nostradamus on what NFLX is worth or where it is going. But I am a student of stock market history, and the one thing that sticks out with NFLX is the stock’s on a parabolic run.
One Year Chart
Here is the ont-year chart of Netflix, but the ten-year chart shows the parabolic run better. A parabolic run happens when a stock which has been climbing suddenly starts jumping higher at a faster rate at the end of the run. Classic examples include Qualcomm and Taser. Tech stocks in the late 1990s also fit this mold.
NFLX isn’t doing much with profit growth because it’s spending to grow. So its hard to tell if it’s really expensive or not. The stock’s like Amazon’s in a way. One thing I do know is the stock’s now double what it was a year ago, and the company doesn’t seem to be worth twice as much as it was a year ago. Sales rose a modest 23% last qtr, 24% 2QtrsAgo.
Fair Value
My Fair Value isn’t indicative on how much NFLX is truly worth because as the company spends to expand into other countries, it’s hurting near term profits. NFLX could be making maybe $0.70 to $1.00 right now if it wasn’t spending to grow. So regular stock analysis doesn’t show the true value fo the company.
Sharek’s Take
Netflix is king of content and is taking over the world. Last qtr I felt the stock could go to $107 in 5+ years and it’s already surpassed that mark. But one thing is for sure, all stocks correct and after this parabolic run NFLX will too. I just don’t know is how much higher the stock will go before that occurs.
View the Earnings Table here. View the Profit History here.View the Ten Year Chart here.
