| Factor | Score | Distribution | Value | Avg | Rank |
|---|---|---|---|---|---|
Valuation | 31 | 24.6x | 18.2x | Bottom tier | |
Growth | 88 | 16.0% | 7.1% | Top tier | |
Quality | 85 | 26.0% | 4.5% | Top tier | |
Safety | 85 | 0.5x | 2.6x | Top tier | |
Capital Return | 64 | — | 2.10% | Around median | |
Momentum | 17 | -41.8% | 2.9% | Bottom tier | |
Sentiment | 44 | 33 | 3 | Around median |
Estimates — analyst targets and a simplified DCF, not investment advice.
Ten ratios that matter, each compared against its sector median and average — so you can see whether a number is rich or cheap relative to peers in the same sector.
Netflix operates a global entertainment service that reaches approximately 330 million subscribing households and addresses an audience approaching one billion people. Most revenue growth comes from subscriptions through increased memberships and price adjustments, while advertising represents an additional source that is expanding as ad technology and ad inventory fill rates improve. The company also invests in local and global films and series, live programming, video podcasts, short-form videos, and cloud gaming to increase subscriber acquisition and retention and enhance returns from its user base.
Revenue for Q2 of fiscal year 2026 reached approximately $12.6 billion, and gross profit was $6.5 billion, equivalent to a calculated gross margin of approximately 51.6%. Net income was $3.4 billion, or a calculated net margin of approximately 27.0%, and earnings per share were $0.80. Compared with Q1 of fiscal year 2026, revenue increased from $12.2 billion, while net income declined from $5.3 billion and earnings per share from $1.23.
On a trailing twelve-month basis through fiscal year 2026, revenue was $48.4 billion, gross profit was $23.8 billion, net income was $13.6 billion, and earnings per share were approximately $3.20. The operating mix relies on subscriptions and pricing as the primary drivers, with a growing contribution from advertising; management said on July 16, 2026, that growth in Q3 of fiscal year 2026 would come from increased memberships and prices and higher advertising revenue. Netflix benefits from distributing content costs across a global footprint, as its share was estimated at only approximately 5% of global television viewing and its penetration at less than 45% of approximately 800 million addressable households.
The analyst consensus rates NFLX a “Buy,” with an average target of $91.82 and a wide range from $75 to $119. The average target lies between the bounds of the 52-week range of $65.08 and $126.71, while the highest target is approximately 6.1% below the top of that range; this balances optimism about fiscal year 2026 growth against the risks of slowing currency-neutral growth and a widening gap among analyst expectations. The data does not include a usable earnings multiple, so the valuation here is based on the target range, the 52-week range, and the company’s ability to deliver expected revenue growth of 13% to 14%.
Figures in the text are as of 2026-08-26; the live price is shown at the top of the page.
Management identified memberships, prices, and advertising revenue as the primary growth drivers during the July 16, 2026 call. It expects annual revenue growth of between 13% and 14%, or approximately 12% excluding currency effects, equivalent to an increase of roughly $6 billion. In Q3 of fiscal year 2026, it expects reported growth of 12% and currency-neutral growth of 11%.
Viewing hours grew 2% during the first half of fiscal year 2026, equivalent to an additional 1.5 billion hours, compared with growth of 1.5% in fiscal year 2025. Management confirmed that the decline in second-season viewing improved slightly compared with the previous year and that The Polygamist achieved 24 million views during five weeks. Nevertheless, increasing content expense by approximately 10% requires continued improvement in acquisition, retention, and advertising to justify costs growing faster than viewing hours.
Management said on July 16, 2026, that higher advertising revenue was one of the drivers of Q3 fiscal year 2026 growth. Average revenue per membership on the ad-supported plan remains below that of the standard ad-free plan, but the gap is narrowing as demand sources expand and advertising technology, measurement, and fill rates improve. The ad-supported plan costs $8.99 in the United States according to the call, giving Netflix a low-priced entry point to attract additional segments.
Automated analysis for informational purposes only — not investment advice.
Management described the addressable gaming market as approximately $150 billion in consumer spending outside China and Russia and excluding advertising. Through the July 16, 2026 call, the number of monthly cloud gaming players had increased 11-fold during eight months, and FIFA and Unhinged had become Netflix’s most successful cloud launches. The number of daily players in Netflix Playground also tripled, and engagement with children’s games on mobile increased 600% year over year, while investment in gaming remained small compared with total content spending.
Through July 16, 2026, generative artificial intelligence tools had been used in approximately 300 productions, particularly in post-production, visual planning, and effects. American Experiment included seventeen minutes of footage enhanced with these tools, which was produced twice as fast and at half the cost of previous options. Management explained that the potential savings would likely be reinvested in additional content rather than treated as an announced reduction in the approximately $20 billion cash content budget.
The analyst consensus rates the stock a “Buy,” with an average target of $91.82, a highest target of $119, and a lowest target of $75. This distribution lies within the 52-week range of $65.08 to $126.71, with a wide $44 difference between the lowest and highest targets. In contrast, insider net selling over three months reached $48.9 million through ten sales and no purchases as of August 10, 2026, while recognizing that these sales may have been prearranged.
