How Netflix Became a $1,000 Stock While Competitors Flopped

When you’d thrown $1,000 at Netflix in 2015, you’d be sitting on about $10,000 as we speak. 

Again in 2015, Netflix (NFLX) was nonetheless shaking off its DVD-by-mail picture and betting huge on streaming and unique content material. Quick-forward a decade, and it’s gone from a scrappy disruptor to an business heavyweight, with a inventory worth over $1,000. 

Whereas legacy media giants like Disney, Warner Brothers and Paramount have struggled to adapt, Netflix rewrote the principles — after which performed the sport higher than anybody else.

Let’s break down precisely how a lot $1,000 invested in Netflix in 2015 can be price as we speak — and why the streaming big’s story is much from over.

What a $1,000 Netflix funding 10 years in the past can be price as we speak

Let’s take a fast time machine journey again to July 27, 2015 — proper after the final inventory spit. Netflix inventory was buying and selling at about $106.43 a share. When you dropped $1,000 on Netflix again then, you’d’ve walked away with 9.4 shares. (Fractional shares weren’t broadly obtainable in 2015 however let’s simply faux they have been.)

Quick ahead to April 25, 2025, and those self same 9.4 shares can be price a jaw-dropping $10,354, with Netflix inventory closing at $1,101.53 per share as we speak. That’s a 935 % return in your preliminary funding. 

In different phrases, should you’d put your cash the place your distant is a decade in the past, your funding would have crushed the S&P, outpaced competitors by an extended shot and 10x’d your money.

That sounds spectacular however let’s put that in context. When you’d as an alternative determined to again extra conventional media corporations, your good points — or somewhat your losses — would inform a really totally different story.

• Disney (DIS): A $1,000 funding in 2015 would now be price simply $733 — a 26.7 % loss.
• Warner Bros. (WBD): $1,000 would have shrunk to $264 — down 73.5 %.
• Paramount (PARA): That funding can be price about $223 as we speak — a staggering 77.8 % loss.

The distinction is stark. Netflix didn’t simply outperform different streaming shares — it left them within the mud. 

How Netflix grew to become an leisure powerhouse

Netflix did one factor legacy gamers didn’t — it didn’t cling to the previous.

Netflix pivoted early into streaming, and by 2015, it was already shifting away from licensed content material and doubling down on originals. That call rapidly paid off. Constructing off the success of “Home of Playing cards” and “Orange is the New Black in 2013, “Stranger Issues” hit in 2016, adopted by large hits corresponding to “The Crown,” “Ozark” and “Narcos,” locking in binge-happy subscribers who didn’t need to wait every week for brand spanking new episodes.

The pandemic helped, too. Whereas the world was caught inside, Netflix grew to become the go-to streaming platform. It added 37 million subscribers in 2020 alone. The corporate additionally noticed its inventory leap from $364 a share in April 2020 to $545 per share by the top of the yr. 

In the meantime, rivals have been nonetheless taking part in catch-up. Disney+ took almost 5 years to show a revenue. Warner Bros. (which owns HBO Max) went by means of a number of technique pivots. Paramount struggled to achieve streaming share because it navigated CEO shakeups and merger talks. 

In contrast to conventional media giants, Netflix didn’t have to fret about field workplace numbers or cable bundles. It didn’t want a TV community or a theater. 

As Morningstar analyst Matthew Dolgin put it in an April 20 word: “[Netflix] was the pioneer in its business, offering it a giant head begin in accumulating subscribers and shifting previous the massive preliminary money burn that we see as obligatory to construct a profitable streaming service.”

Is Netflix a $1 trillion inventory?

Solely seven U.S. corporations have a market cap of $1 trillion or extra. Netflix isn’t there but, however with a present $468.8 million market cap and rising business dominance, it’s inside putting distance.

Executives aren’t hiding their ambitions both. Through the firm’s newest earnings name, co-CEO Gregory Peters mentioned, “We do have huge long-term aspirations and people aspirations are actually grounded within the potential for progress that we see within the enterprise.” 

Right here’s what may get Netflix into the trillion-dollar name. 

Tariff-proof international attain 

Netflix’s funding in worldwide content material has helped it unlock large progress past the U.S. It’s spent billions on local-language productions throughout Asia, Latin America and Europe, providing country-specific unique content material in 50 international locations. 

With 300 million paying subscribers throughout the globe, Netflix now has the most important streaming subscriber base on the planet by a large margin. And lots of areas — together with Europe, the Center East and Africa — nonetheless have vital room to develop. 

Rising advert income

Netflix launched its ad-supported tier in 2022, and though promoting at present makes up a small slice of its total income, the potential is big. Throughout a name with shareholders in April, executives mentioned they plan to double promoting income in 2025 alone. 

As subscriber progress within the U.S. tapers off, promoting provides Netflix a brand new edge. In spite of everything, the muse is already there: Netflix has an enormous international subscriber base and sticky engagement — two issues advertisers are determined for because the demise knell of cable tolls. 

“Promoting-supported subscriptions will open Netflix to a brand new base of subscribers and a serious new income,” wrote Dolgin.

As a part of its push to scale its promoting enterprise, Netflix launched its personal advert tech platform on April 1, shifting away from third-party companions like Microsoft. 

Proudly owning its personal advert tech may give Netflix extra management over focusing on, measurement and reporting — key instruments for attracting main advert {dollars}. The U.S. launch additionally strategically aligns with the spring upfronts, a time when advertisers commit huge budgets for the yr forward.

It’s constructed to outlive a recession

Netflix is broadly thought-about a recession-resilient firm, if not totally recession-proof. For below $20 a month, it gives a whole lot of hours of leisure, providing numerous worth to budget-conscious shoppers throughout onerous occasions. Buyers love that type of consistency and predictability.

Earnings are scaling rapidly

Netflix isn’t simply rising — it’s turning into considerably extra worthwhile. 

In Q1 2025, the corporate beat expectations and posted a 47 % leap in working revenue over the earlier quarter. The enterprise is turning into extra environment friendly, extra predictable and extra worthwhile — which Wall Road rewards.

Morningstar tasks working margins will rise from 27 % in 2024 to almost 35 % by 2030. Free money circulate is predicted to greater than double from $7 billion in 2024 to $18 billion by decade’s finish. Morningstar can also be forecasting 10 % common annual income progress over the following 5 years. 

That each one aligns properly with the targets specified by the corporate’s newest shareholder letter: Maintain wholesome income progress, increase working margin and ship rising free money circulate. 

Is Netflix going to separate its inventory?

Netflix hasn’t cut up its inventory in a decade, however given the corporate’s constant progress, it wouldn’t be shocking if it occurred quickly.

The corporate has solely cut up its inventory twice since going public in 2002. The primary time was a 2-for-1 cut up on February 2004. The second and most up-to-date was a 7-for-1 cut up in July 2015 when the inventory had rocketed as much as round $700. 

At the moment, the inventory is at or hovering close to all-time highs of over $1,000 a share. 

Whereas Netflix hasn’t mentioned something publicly, historical past suggests it could possibly be due for a cut up. A inventory cut up doesn’t change the basics, although — it’s like breaking a $20 invoice into two $10s — however it does make shares look cheaper, which tends to draw extra retail traders. That would give Netflix one other shot of momentum.

Backside line

A $1,000 funding in Netflix in 2015 can be price greater than $10,000 as we speak. That’s what betting on a category-defining disruptor seems like. Whereas Disney and different friends struggled to pivot, Netflix leaned into its strengths and constructed a worldwide empire.

As Morningstar put it: “[Netflix] has no legacy property which might be dropping worth as society transitions to new methods of consuming video leisure at residence.”

And based mostly on its momentum, Netflix is barely getting began.

Editorial Disclaimer: All traders are suggested to conduct their very own impartial analysis into funding methods earlier than investing choice. As well as, traders are suggested that previous funding product efficiency isn’t any assure of future worth appreciation.