-1.62 | -0.68%
NETFLIX INC's gross profit margin for the first quarter of its fiscal year 2013 has increased when compared to the same period a year ago. The company has grown sales and net income during the past quarter when compared with the same quarter a year ago, however, it was unable to keep up with the growth of the average competitor within its industry. NETFLIX INC has weak liquidity. Currently, the Quick Ratio is 0.61 which shows a lack of ability to cover short-term cash needs. The company's liquidity has increased from the same period last year.
During the same period, stockholders' equity ("net worth") has increased by 22.53% from the same quarter last year. Overall, the key liquidity measurements indicate that the company is in a position in which financial difficulties could develop in the future.
| Income Statement | Q1 FY13 | Q1 FY12 |
|---|---|---|
| Net Sales ($mil) | 1023.96 | 869.79 |
| EBITDA ($mil) | 547.85 | 369.18 |
| EBIT ($mil) | 31.82 | -1.94 |
| Net Income ($mil) | 2.69 | -4.58 |
| Balance Sheet | Q1 FY13 | Q1 FY12 |
|---|---|---|
| Cash & Equiv. ($mil) | 1025.87 | 804.53 |
| Total Assets ($mil) | 4363.29 | 3480.46 |
| Total Debt ($mil) | 700.0 | 400.0 |
| Equity ($mil) | 812.92 | 663.4 |
| Profitability | Q1 FY13 | Q1 FY12 |
|---|---|---|
| Gross Profit Margin | 79.41 | 70.93 |
| EBITDA Margin | 53.5 | 42.44 |
| Operating Margin | 3.11 | -0.22 |
| Sales Turnover | 0.86 | 0.96 |
| Return on Assets | 0.55 | 4.63 |
| Return on Equity | 3.0 | 24.31 |
| Debt | Q1 FY13 | Q1 FY12 |
|---|---|---|
| Current Ratio | 1.51 | 1.42 |
| Debt/Capital | 0.46 | 0.38 |
| Interest Expense | 6.74 | 4.97 |
| Interest Coverage | 4.72 | -0.39 |
| Share Data | Q1 FY13 | Q1 FY12 |
|---|---|---|
| Shares outstanding (mil) | 56.14 | 55.52 |
| Div / share | 0.0 | 0.0 |
| EPS | 0.05 | -0.08 |
| Book value / share | 14.48 | 11.95 |
| Institutional Own % | n/a | n/a |
| Avg Daily Volume | 4542043.0 | 5099990.0 |
HOLD. NETFLIX INC's P/E ratio indicates a significant premium compared to an average of 105.32 for the Internet & Catalog Retail industry and a significant premium compared to the S&P 500 average of 19.08. For additional comparison, its price-to-book ratio of 16.37 indicates a significant premium versus the S&P 500 average of 2.44 and a significant premium versus the industry average of 11.29. The price-to-sales ratio is well above the S&P 500 average, but well below the industry average. After reviewing these and other key valuation criteria, NETFLIX INC proves to trade at a premium to investment alternatives within the industry.
| Price/Earnings |
|
Price/Cash Flow |
| |||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| NFLX 564.36 | Peers 105.32 | NFLX NM | Peers 25.56 | |||||||||||||||||||||
|
Premium. A higher P/E ratio than its peers can signify a more expensive stock or higher growth expectations. NFLX is trading at a significant premium to its peers. |
Neutral. The P/CF ratio, a stock’s price divided by the company's cash flow from operations, is useful for comparing companies with different capital requirements or financing structures. NFLX's P/CF is negative making the measure meaningless. |
|||||||||||||||||||||||
| Price/Projected Earnings |
|
Price to Earnings/Growth |
|
|||||||||||||||||||||
| NFLX 72.49 | Peers 122.79 | NFLX 1.44 | Peers 0.96 | |||||||||||||||||||||
|
Premium. A higher price-to-projected earnings ratio than its peers can signify a more expensive stock or higher future growth expectations. NFLX is trading at a significant premium to its peers. |
Premium. The PEG ratio is the stock’s P/E divided by the consensus estimate of long-term earnings growth. Faster growth can justify higher price multiples. NFLX trades at a significant premium to its peers. |
|||||||||||||||||||||||
| Price/Book |
|
Earnings Growth |
|
|||||||||||||||||||||
| NFLX 16.37 | Peers 11.29 | NFLX -85.91 | Peers -55.77 | |||||||||||||||||||||
|
Premium. A higher price-to-book ratio makes a stock less attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet. NFLX is trading at a significant premium to its peers. |
Lower. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios. However, NFLX is expected to significantly trail its peers on the basis of its earnings growth rate. |
|||||||||||||||||||||||
| Price/Sales |
|
Sales Growth |
|
|||||||||||||||||||||
| NFLX 3.54 | Peers 5.07 | NFLX 12.14 | Peers 24.63 | |||||||||||||||||||||
|
Discount. In the absence of P/E and P/B multiples, the price-to-sales ratio can display the value investors are placing on each dollar of sales. NFLX is trading at a significant discount to its industry on this measurement. |
Lower. A sales growth rate that trails the industry implies that a company is losing market share. NFLX significantly trails its peers on the basis of sales growth |
|||||||||||||||||||||||
