If You Invested $1000 in Netflix 10 Years Ago, This Is How Much You’d Have Now
How much a stock’s price changes over time is a significant driver for most investors. Not only can price performance impact your portfolio, but it can help you compare investment results across sectors and industries as well.
The fear of missing out, or FOMO, also plays a factor in investing, especially with particular tech giants, as well as popular consumer-facing stocks.
What if you’d invested in Netflix (NFLX) ten years ago? It may not have been easy to hold on to NFLX for all that time, but if you did, how much would your investment be worth today?
Netflix’s Business In-Depth
With that in mind, let’s take a look at Netflix’s main business drivers.
Netflix is considered a pioneer in the streaming space. The company evolved from a small DVD-rental provider to a dominant streaming service provider, courtesy of its wide-ranging content portfolio and a fortified international footprint. At the end of the second quarter of 2024, the company had 277.65 million paid subscribers globally.
Netflix has been spending aggressively on building its portfolio of original shows. This is helping the company sustain its leading position despite the launch of new services like Disney+ and Apple TV+, as well as existing services like Amazon Prime Video.
Netflix streams movies, television shows and documentaries across a wide variety of genres and languages. Domestic and international subscribers can watch them on a host of internet-connected devices, including television sets, computers, and mobile devices.
The Los Gatos, CA-based company reported revenues of $33.72 billion in 2023.
Beginning fourth-quarter 2019, Netflix started declaring revenues and membership data by regions — the Asia Pacific (APAC); Europe, Middle East & Africa (EMEA); Latin America (LATAM); and the United States and Canada (UCAN).
UCAN accounted for 44.9% of second-quarter 2024 revenues. At the end of the quarter, the company had 84.11 million paid subscribers in the region.
EMEA accounted for 31.5% of second-quarter 2024 revenues. Netflix had 93.96 million paid subscribers in the region at the end of the quarter.
LATAM contributed 12.6% of second-quarter 2024 revenues and had 49.25 million paid subscribers in the region at the end of the quarter.
APAC accounted for 11% of second-quarter 2024 revenues. The company had 50.23 million paid subscribers in the region at the end of the quarter.
Bottom Line
Anyone can invest, but building a successful investment portfolio takes a combination of a few things: research, patience, and a little bit of risk. So, if you had invested in Netflix a decade ago, you’re probably feeling pretty good about your investment today.
A $1000 investment made in August 2014 would be worth $10,277.96, or a 927.80% gain, as of August 19, 2024, according to our calculations. Investors should note that this return excludes dividends but includes price increases.
Compare this to the S&P 500’s rally of 184.10% and gold’s return of 86.07% over the same time frame.
Analysts are anticipating more upside for NFLX.
Netflix added 8.05 million paid subscribers globally in second-quarter 2024, with a rise of 1% in average revenue per subscription. The company attributed the robust top-line growth to its paid subscription-sharing offering (part of its password-sharing crackdown), recent price changes and the strength of its business in general. Netflix is expected to continue dominating the streaming space, courtesy of its original and diversified content portfolio, which is attributable to heavy investments in the production and distribution of localized and foreign-language content. Shares have outperformed the industry year to date. However, stiff competition in the streaming space from the likes of Apple, Amazon Prime Video, Disney+, Peacock and Paramount+ is a headwind. The company’s leveraged balance sheet and a higher streaming obligation are concerns.
Over the past four weeks, shares have rallied 6.43%, and there have been 12 higher earnings estimate revisions in the past two months for fiscal 2024 compared to none lower. The consensus estimate has moved up as well.
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Netflix, Inc. (NFLX) : Free Stock Analysis Report
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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