$NFLX has taken an enormous drop with the user growth slowing as the market gets more competitive. This has resulted in a major repricing dropping it down to a 17 PE. While I do not foresee them resuming their high user growth in the future they will probably be able to resume a slower user growth trend and potentially surprise the market by increasing the value per user. At the current price is the risk-reward seems favorable although I am not in a rush to buy this name and think its worthwhile to let it base.
Pre pandemic they had 167 million users which has growth to 221 in two years. I believe the slowdown right now in user growth is more a "consolidation" from the surge they had in 2020 rather then an actual decline. Basically since they had above trend user growth in 2020-2021 they have lower growth in 2022 to average out to their previous growth trend they were at.
Pre pandemic they had 167 million users which has growth to 221 in two years. I believe the slowdown right now in user growth is more a "consolidation" from the surge they had in 2020 rather then an actual decline. Basically since they had above trend user growth in 2020-2021 they have lower growth in 2022 to average out to their previous growth trend they were at.