Updated

Updated · The Motley Fool · Jul 31

Netflix Draws Fresh Buy Calls After 46% Drop as Free Cash Flow Heads for $12.5 Billion

Updated

Updated · The Motley Fool · Jul 31

Netflix Draws Fresh Buy Calls After 46% Drop as Free Cash Flow Heads for $12.5 Billion

1 articles · Updated · The Motley Fool · Jul 31

$12.5 billion in projected 2026 free cash flow is driving fresh bullish calls on Netflix after the stock fell about 46% from last summer's peak.
325 million subscribers and rising revenue per member underpin that cash generation, with price increases and advertising expected to lift ad sales to about $3 billion this year from $1.5 billion in 2025.
$19 billion in annual content spending has stayed relatively efficient per user, while live events are adding sign-ups and management's margin targets continue to expand operating profitability.
$11.5 billion in share repurchases through the first half and $27 billion still authorized give Netflix another way to deploy excess cash at what bulls see as an attractive valuation.
At roughly 28 times free cash flow, supporters argue Netflix now trades more like traditional media peers despite lacking the legacy linear-TV drag on growth and cash generation.

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With $12.5 billion in cash flow and massive buybacks, is Wall Street completely misjudging Netflix's massive 46 percent stock crash?

As advertisers flood Netflix's new tiers, will escalating content costs eventually shatter its impressive 33 percent profit margin?

Could a rumored Warner Bros. Discovery deal derail Netflix's strategy, or is this cash-rich streaming giant truly unstoppable?

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