Netflix (NFLX +0.80%) shares might be 39% off their record right now (as of June 4), but investors can’t argue with its long-term performance. The streaming stock has rocketed 719% higher in the past decade. Today, the company’s market capitalization sits at a sizable $343 billion.
But could this become a trillion-dollar stock by 2030?
Image source: The Motley Fool.
Netflix’s market cap will need to expand by 192% over the next four years to reach the 13-figure club, which currently has only 15 members in it. This translates to a robust 30.7% annualized growth rate.
As a reference, over the past four years, Netflix’s valuation has risen by 289%. However, this comparison might be skewed since the stock tanked in 2022 due to subscriber losses, so it was starting from a low base.
Today’s Change
(0.80%) $0.66
Current Price
$82.84
Key Data Points
Market Cap
$346B
Day’s Range
$81.35 – $83.06
52wk Range
$75.01 – $134.12
Volume
1.1M
Avg Vol
38.1M
Gross Margin
49.44%
It doesn’t seem likely that Netflix will be able to reach a trillion-dollar market cap by 2030. For starters, its valuation isn’t cheap, so there is a low probability that the multiple can introduce meaningful upside. The stock trades at a price-to-earnings ratio of 26.3.
Additionally, the company’s growth is slowing. Management expects Netflix to report $51.2 billion in revenue in 2026 (at the midpoint), which would be up 13.3% year over year.
Long gone are the days of greater than 20% annualized top-line gains. This isn’t exactly a surprising revelation. Netflix is more mature than it was in its earlier years. And competition for attention is fierce.
Neil Patel has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Netflix. The Motley Fool has a disclosure policy.
