Netflix: Potential Upside On Ad Business Monetization And Video Gaming Expansion


  • Netflix delivered a phenomenal quarterly earnings call, which gave analysts, investors, and insiders hope in the company.
  • The stock responded positively by +8% in the following session. We provide an update to our thesis upon reviewing all the data points from the sell-side and management numbers.
  • We recommend the stock to our readers, as we initiate the stock at buy and offer a price target that’s 40% higher at $486 per share.
  • We anticipate that revenue will return to high-single digits growth in FY’23 and mid-teen revenue growth in FY’24 due to advertising contribution.
  • Video gaming could be a hidden call option that adds material upside and could change the cadence of news towards added M&A activity, diminishing some headline negativity.
Netflix Los Angeles Headquarters building.


Has Netflix (NASDAQ:NFLX) gone into secular decline? Perhaps not, as the company was able to reassure many investors and analysts of the potential growth runway inclusive of ad-supported content. We think investors are underestimating the value premium for “best in breed” companies even in

Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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