Identifying standout stocks can be a challenge. With over 4,000 public companies on the New York Stock Exchange and Nasdaq, it can be overwhelming.

However, some stocks truly stand out for their remarkable performance.

Netflix (NASDAQ: NFLX) is widely recognized, but its popularity might overshadow how well it’s actually performing.

Recently, Netflix co-CEO Ted Sarandos shared an impressive report that highlights the company’s massive success. Here’s an overview of his key points.

Netflix is thriving

Each earnings season, Netflix is typically among the first to report its financial results. In this latest quarter, the company performed exceptionally well, causing its stock price to soar. Currently, Netflix shares are priced at over $975, achieving a record high just recently.

This growth is attributed to Netflix’s strong performance across all areas of its business.

First off, Netflix has surpassed 300 million subscribers. This figure is remarkable not just in total numbers—given that the entire U.S. population is approximately 345 million—but also in the speed at which it has grown.

In 2022, Netflix had about 220 million subscribers and faced stagnation. The company even lost approximately 2 million subscribers during the first half of 2022, which led to a drop in shares. Nevertheless, Netflix’s leadership remained focused on strategies to boost subscriber numbers.

They implemented stricter measures against password sharing, introduced an ad-supported subscription tier, and now, two years later, subscriber growth has rebounded impressively. Overall, there has been a 36% increase in total subscribers over the past two-and-a-half years.

NFLX Operating Revenue (Quarterly YoY Growth) data by YCharts.

Netflix is overtaking traditional TV

One of the primary reasons Netflix shares have skyrocketed by an incredible 81,610% since their launch in 2002 is the way it has disrupted traditional television.

This isn’t just a minor concern for traditional TV; it’s a full-on challenge. Live sports remain one of the few areas where traditional broadcasters still have an edge over streaming services like Netflix.

While Sarandos didn’t explicitly announce a plan to dive fully into live sports, indications suggest it could happen. With significant cash flow and market reach, Netflix is already exploring live events like the Mike Tyson / Jake Paul fight, WWE Monday Night Raw, and select NFL games.

As Netflix continues to expand its coverage of live events, it could further erode the market share of traditional providers.

Should you invest in Netflix now?

To summarize, yes, Netflix appears to be a compelling option for investors. The company has demonstrated that its business model is robust. Additionally, the ongoing decline of traditional television is likely to fuel further growth for Netflix as more high-profile live events, such as sports, transition towards streaming platforms.

That said, Netflix might not appeal to every investor. With a high valuation—its price-to-earnings (P/E) ratio nearing 50x—value investors may want to avoid this stock.

However, for those in search of a growth stock with significant potential, Netflix is definitely worth considering.

Jake Lerch does not hold any positions in the stocks discussed. The Motley Fool has investments in and recommends Netflix. The Motley Fool also recommends Nasdaq. The Motley Fool follows a disclosure policy.

The Motley Fool is a content partner of YSL News that offers financial news, analysis, and commentary aimed at helping individuals manage their financial futures. Its content is independently produced from YSL News.

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