NFLX
Netflix, Inc.
$72.81
Platform & Compounding FCF
75%
Two-stage FCF DCF
Mild
·
Conviction
Overvalued
Trading 14.0% above fair value
You pay
$72.81
Bear
$43.86
Fair
$63.86
Bull
$84.73
Bear
$43.86
-39.8%
8% stage 1 growth, 12% discount
Fair
$63.86
-12.3%
13% stage 1 growth, 12% discount
Bull
$84.73
+16.4%
16% stage 1 growth, 12% discount
Key Value Driver
FCF growth rate (13% base case)
Terminal Value % of EV
37%
Implied Market Multiple
33.6x
Market is pricing in (growth)
17.9%
vs 12.6% base
Summary
Our base-case estimate uses a two-stage discounted cash flow model based on free cash flow. We then blend that result with the average analyst price target of $91.82 from 99 analysts, using a 35% weight on analyst consensus. That produces an estimated intrinsic value of $63.86 per share.
Warnings
Wall Street's average price target is $91.82 (from 99 analysts). Our estimate is 47% below the consensus -- consider that gap carefully.
Key Risks
- P/E alone misleads — earnings depressed by growth investment
- Cyclical or commodity businesses may be misclassified as platforms
- Terminal value dominance suggests sensitivity to long-run assumptions