Netflix (NFLX)

This is really a no-brainer.

Netflix launched its streaming services in the US in 2007. This industry pioneer has since evolved to become one of the largest online video service providers. Netflix made its initial public offering in 2002 at $15 per share. On 19 June 2018, shares jumped to an all-time high of over $404.

In the past five business days, Netflix has soared 10% — that too, when the market was going through a volatile period. While this has cast doubts on many an analyst that the company’s valuation might be a bit stretched, it’s still robust stock that soared 117% in the long-term.

With Heath Terry (5-star analyst at Goldman Sachs) predicting Netflix to jump another 18% to $490, all the streaming giant is seeing is green.

It’s no surprise that Netflix is a key top-investor holding. Even in the last five days the stock has soared another 10%. This is in the midst of a volatile and hesitant market.

This IG contains data before 1Q18 results. The first quarter numbers are outlook-based.

And if we look on a longer-term basis, NFLX is up over 117%. So no wonder some analysts are concerned that the current valuation looks stretched. However, other top analysts are still confident that a long growth runway lies ahead.

“While our target multiple represents a clear premium relative to the sector, we believe it largely reflects Netflix’s long-term subscriber and margin potential,” Terry said in the note.

While the cash burn might alert many investors, according to Goldman Sachs, the $3–4 billion investment in content is imperative for the service to bring in better content, which will cement Netflix’s position in both the market and in attracting more customers.

In the last three months, the stock has accrued 18 BUY, 12 HOLD, and 1 SELL ratings. But it should be noted that three of them have put the price target at $350, hinting a downward trend of about 16%.

However, Netflix also drives positive sentiment whenever they have a blockbuster in their hand. That, along with more portfolios addling NFLX to themselves, it is undoubtedly among the top hot stocks.