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A Financial Analysis and Valuation of Netflix
- 1 School of Economics, Guangdong University of Technology, Guangzhou, 510520, China
* Author to whom correspondence should be addressed.
Abstract
As the streaming competition has intensified in recent years, Netflix has maintained its highest subscriber base since its inception, and research has shown that Netflix's success has had a significant impact on investors making the right investment decisions. This paper examines why Netflix, a streaming platform, outperforms its competitors. Choose Comcast; the other four most prominent companies in the entertainment industry, Walt Disney, Paramount Global, and WBD, perform a comparative analysis of financial data on liquidity, solvency, and profitability. The conclusion is that Netflix has plenty of liquidity, significant even available funds, robust debt management, and excellent profitability. Based on valuation analysis, it can be seen that Netflix has managed both its β_A and financial performance well and has a range of operational strategies. However, considering the unknown market changes (such as stronger competitors and a possible slowdown in its user growth), its stock price is considered to be overvalued when taking all factors into account.
Keywords
Netflix, Video Streaming Industry, Financial Valuation
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Cite this article
Su,X. (2024). A Financial Analysis and Valuation of Netflix. Advances in Economics, Management and Political Sciences,103,33-41.
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Volume title: Proceedings of the 8th International Conference on Economic Management and Green Development
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