Netflix, Inc. (NFLX) Intrinsic Value & DCF Valuation
Entertainment · NASDAQ
Current Price
$80.34
Intrinsic Value
$133.99
+40.0% margin of safety
What Is Netflix, Inc.'s Intrinsic Value?
As of 2026-06-12, our base-case DCF model estimates the intrinsic value of Netflix, Inc. (NFLX) at $133.99 per share, compared with a market price of $80.34, a margin of safety of +40.0%. The base case assumes 18.8% annual free cash flow growth and a 10.0% discount rate.
Across the sensitivity grid the estimate spans $112.19 to $158.59. Intrinsic value is an estimate built on assumptions, not a fact. A higher discount rate or slower growth pushes the estimate down, while stronger cash flow growth lifts it.
How our DCF works · Recalculate with your own assumptions · What is intrinsic value?
Is Netflix, Inc. (NFLX) Undervalued?
At the current price of $80.34, NFLX trades well below our base-case intrinsic value estimate, a margin of safety above 30%. By this model the stock looks undervalued, but verify the growth assumptions match your own view before acting.
COMPETITIVE MOAT
↑Global Brand Recognition
Netflix's brand is synonymous with streaming worldwide. This strong recognition drives subscriber acquisition and retention, creating a significant barrier to entry for new competitors.
↑Vast Content Library
The sheer volume and diversity of Netflix's content library, including exclusive originals, are a major draw for consumers. This deep catalog makes it difficult for rivals to replicate the same breadth of appeal.
↑Data-Driven Content Strategy
Netflix leverages extensive user data to inform content creation and acquisition. This allows for more targeted and successful programming, increasing engagement and reducing churn.
INVESTMENT RISKS
↓Intensifying Competition
The streaming landscape is increasingly crowded with deep-pocketed rivals like Disney+, Max, and Amazon Prime Video. This competition pressures subscriber growth and content spending.
↓Content Production Volatility
Netflix's reliance on original content means its success is tied to the unpredictable nature of hit-making. A string of misses, as seen with some film releases, can impact subscriber sentiment.
↓Subscriber Growth Saturation
Achieving significant further subscriber growth, especially in mature markets, is becoming more challenging. The pursuit of a trillion-dollar valuation requires substantial, sustained expansion.
Base case
NFLX base case valuation
Intrinsic Value
$133.99
Margin of safety
+40.0%
Expected annual return
+10.8%
Base case assumptions: 18.8% annual growth, 10.0% discount rate, 28x exit multiple, 5 year projection. Data as of 2026-06-12.
This base case uses default assumptions and is not financial advice. The intrinsic value changes significantly when the growth rate or discount rate changes. Open the calculator to set your own assumptions and see the full sensitivity range.
Customize the NFLX valuation
Adjust the growth rate, discount rate, and exit multiple to see how the intrinsic value and margin of safety for Netflix, Inc. respond.
Open DCF Calculator for NFLXCompany Overview
Netflix, Inc. serves as a worldwide entertainment provider. Its comprehensive library features television series, motion pictures, documentaries, and mobile games, spanning numerous genres and languages. Members can effortlessly stream this content through a variety of internet-connected devices, including smart TVs, digital media players, cable boxes, and mobile phones. Furthermore, the company continues to offer a DVD-by-mail subscription service to its customers in the United States. With roughly 222 million paying subscribers distributed across 190 countries, Netflix was founded in 1997 and is headquartered in Los Gatos, California.
Financial Metrics — NFLX Stock Valuation Data
Revenue/Share (TTM)
$11.10
FCF/Share (TTM)
$2.82
ROIC (TTM)
23.1%
ROE (TTM)
49.2%
P/FCF
28.4x
EV/EBITDA
10.1x
FCF Yield
3.52%
Debt/Equity
0.54x
Based on trailing twelve-month data, NFLX shows a free cash flow per share of $2.82 and a ROIC of 23.1%, key inputs for stock valuation using the DCF method. The P/FCF ratio of 28.4x and FCF yield of 3.52% are important context metrics when evaluating NFLX's stock valuation relative to peers.
Frequently Asked Questions
What is the intrinsic value of NFLX?
Netflix, Inc. currently generates $2.82 in free cash flow per share. At the current price of $80.34, a DCF model would discount these cash flows at an appropriate WACC and apply a terminal growth rate to arrive at an intrinsic value. The result depends heavily on your growth and discount rate assumptions — a 1% change in WACC typically shifts the fair value estimate by 10-15%. In MiniValuator the model uses a single discount rate that you can edit directly, 10% by default, rather than a computed WACC.
Is NFLX undervalued?
NFLX trades at a P/FCF ratio of 28.4x with a free cash flow yield of 3.52%. This P/FCF is in a moderate range. However, whether NFLX is truly undervalued requires comparing the DCF intrinsic value to the current market price and evaluating whether the margin of safety is sufficient for your risk tolerance.
How do I value NFLX stock using DCF?
To perform a DCF valuation on Netflix, Inc.: (1) Start with the trailing free cash flow per share ($2.82) as the base, (2) project future FCF growth over 5-10 years based on Entertainment industry trends and company fundamentals, (3) apply a discount rate (WACC) reflecting NFLX's risk profile — with a debt-to-equity of 0.54x, capital structure is an important factor, and (4) add a terminal value for cash flows beyond the projection period.
What is DCF valuation and how does it apply to NFLX?
DCF (Discounted Cash Flow) estimates what a company is worth today based on its future cash generation. For Netflix, Inc., this means projecting how much free cash flow the company will produce over the next 5-10 years, shaped by Entertainment trends, then discounting those amounts to today's dollars. NFLX's ROIC of 23.1% indicates strong capital efficiency, which supports higher growth assumptions in the DCF model.
How does WACC affect NFLX stock valuation?
WACC (Weighted Average Cost of Capital) is the discount rate in a DCF model — it reflects the minimum return investors require. For NFLX, with a debt-to-equity ratio of 0.54x, the capital structure directly influences WACC. A 1% increase in WACC typically reduces the intrinsic value by 10-15%. At an EV/EBITDA of 10.1x, the market's implied discount rate can be reverse-engineered for comparison. In MiniValuator you set this discount rate yourself as a single editable number, 10% by default, instead of computing a formal WACC.
Learn More
- See NFLX PE Valuation → — Earnings-based stock valuation using PE ratio analysis
- DCF Methodology — Step-by-step guide to discounted cash flow analysis
- PE Methodology — Guide to PE ratio stock valuation
- WACC — Understanding the discount rate used in DCF
- Margin of Safety — How to evaluate downside protection
- Intrinsic Value — How to evaluate stock fair value
- How to Calculate Intrinsic Value — Complete guide for investors
Related Valuations
All Communication Services valuationsDCF and P/E value NFLX with different methods and assumptions, so the two conclusions can differ. Compare the P/E fair value.
Price as of 2026-06-12. Financial data from Financial Modeling Prep (trailing twelve months) · Valuation methodology by Charlie Wang.
This is an estimate, not investment advice.