NFLX
Netflix, Inc.
$77.38
Platform & Compounding FCF
75%
Two-stage FCF DCF
Mild
·
Conviction
Overvalued
Trading 9.7% above fair value
You pay
$77.38
Bear
$48.43
Fair
$70.52
Bull
$93.55
Bear
$48.43
-37.4%
8% stage 1 growth, 12% discount
Fair
$70.52
-8.9%
13% stage 1 growth, 12% discount
Bull
$93.55
+20.9%
16% stage 1 growth, 12% discount
Key Value Driver
FCF growth rate (13% base case)
Terminal Value % of EV
37%
Implied Market Multiple
36.1x
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 $111.83 from 99 analysts, using a 35% weight on analyst consensus. That produces an estimated intrinsic value of $70.52 per share.
Warnings
Wall Street's average price target is $111.83 (from 99 analysts). Our estimate is 57% 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