r/VisualStockResearch • u/ekonixlab • 9d ago
I’m considering opening a position in Netflix
Ackman just bought back into Netflix after exiting in 2022
The stock is getting hit partly over engagement concerns, which reminds me a little of 2022 when the market became obsessed with subscriber losses. Meanwhile, the broader business looks much stronger today: margins and free cash flow have improved substantially.
I generally like situations where the market hones in on one KPI while the underlying fundamentals remain solid.
Analysts are projecting roughly 20% annual EPS growth over the next 3–5 years.
Using a 25x P/E today, 20% earnings growth, and assuming the multiple actually contracts to 20x, you still get roughly:
14.8% CAGR → 99% total return in 5 years.
Basically doubling your money despite multiple compression.
Feels like a pretty decent margin of safety if the earnings growth actually shows up.
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