On 7-17-17 I posted this in this Financial Markets room in a thread titled, Netflix:
Quote:
In fiscal year ending 2016 Netflix earned $20 in free cash flow.
As a point of comparison Netflix earned $10 in 2012, $12 in 2013, $14 in 2014 and $14.50 in 2015. It's been a money machine from jump street, and continues more so today.
If you buy Netflix now at $160, you are paying 8 times free cash flow (FCF). A great bargain for a great growing company. It's been a long term hold of mine for many years.
I have as my own estimate Netflix generating $23 FCF in 2018, and $25 in 2019.
At 8 times FCF, Netflix is worth about $185 in '18, and $200 in 2019.
At 10 times FCF, we're looking at $230 and $250, respectively.
I am told 15 times FCF is considered a 'fair' valuation for a public company. I have never in my adult life paid 15 times or more FCF for a company, btw.
So, at 15 times FCF, the 'fair' intrinsic value of Netflix is $300 right now; $345 next year and $375 in 2019.
One of the great bargains in today's market.
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In less than eight months -- eight months!! -- here's the most recent Netflix price:
Netflix (NFLX)
$315.92
14.87 (4.94%)
Netflix, Inc. | NASDAQ
3:08 PM 3/5/18Bats BZX Real-Time Price
I expect PA-Mike to slap me down a bit or two, but it is
quite possible that I have made more money for PA posters with my financial and stock market talk than all the handicapping software and information out there in history.
