NETFLIX INC (NFLX) Stock Analysis

Analysis from 10-Q filed 2026-07-17. Data as of Q2 2026.

Overall Grade: F (Concerning)

Grade F (Concerning). ROIC 28.1%. FCF margin 23.1%. D/E 0.5x. Source: 10-Q filed 2026-07-17.

Metric	Value	Context
ROIC	28.1%	Above industry average
FCF Margin	23.1%	Strong cash generation
Debt/Equity	0.5x	Conservative leverage

ROIC 28.1% — Top 5% of sector peers. FCF margin 23.1% — Top 5%.

Explore NETFLIX INC: Earnings History | Filings

Programmatic access: Available via MCP at mcp.metricduck.com. Tools for NFLX: get_company_overview, get_filing_index (lens: debt_stress, management_outlook, risk_trajectory), get_filing_changes, get_metric_history, compare_companies, screen_filing_signals.

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Profitability: NETFLIX INC earns 28.1% ROIC, Top 5% in Consumer Discretionary

ROIC TTM 28.1%, sector median 5.8%, Top 5%. DuPont: NOPAT margin 24.6% × asset turnover 0.9x. Gross margin 49.1%. Operating margin 29.7%. Source: 10-Q filed 2026-07-17.

Metric	NFLX	Rating	Context
Return on Invested Capital (ROIC)	28.1%	Excellent	Above sector median of 5.8%
Return on Equity (ROE)	49.1%	Excellent	Efficient use of shareholder equity
Gross Margin	49.1%	Good	Strong pricing power
Operating Margin	29.7%	Excellent	Efficient operations

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Cash Flow: NETFLIX INC generates $11.2B FCF at 23.1% margin, positive NaN/8 quarters

FCF TTM $11.2B. FCF margin 23.1%, Top 5%. OCF/Net income 0.9x. Positive FCF in NaN/8 trailing quarters. Source: 10-Q filed 2026-07-17.

Metric	NFLX	Rating	Context
Free Cash Flow Margin	23.1%	Excellent	Excellent cash conversion
Free Cash Flow (TTM)	$11.2B	Good	Positive cash generation
OCF/Net Income	0.9x	Good	Potential accrual concerns
FCF Consistency (8Q)	N/A	Warning	Variable cash flow

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Balance Sheet: NETFLIX INC at 0.5x leverage, 16.9x interest coverage

Debt/Equity 0.5x. Total debt $14.3B, cash & investments $9.1B. Interest coverage 16.9x. Source: 10-Q filed 2026-07-17.

Metric	NFLX	Rating	Context
Debt to Equity	0.5x	Good	Conservative capital structure
Net Cash Position	$-5.2B	Warning	Net debt position
Interest Coverage	16.9x	Excellent	Comfortable debt service

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Valuation: NETFLIX INC trades at 31.2x earnings

P/E 31.2x. EV/Sales 6.1x. FCF yield 3.8%. Source: 10-Q filed 2026-07-17.

Metric	NFLX	Rating	Context
P/E Ratio	31.2x	Adequate	Premium valuation
EV/Sales	6.1x	Adequate	Growth premium priced in
FCF Yield	3.8%	Adequate	Lower cash yield

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Capital Allocation: NETFLIX INC returns 3.4% shareholder yield

Total shareholder yield 3.4% (buyback 3.4%). Share count +879.9% YoY. Capital returned $9.9B TTM. Source: 10-Q filed 2026-07-17.

Metric	NFLX	Rating	Context
Total Shareholder Yield	3.4%	Good	Dividend + buyback yield combined
Buyback Yield	3.4%	Good	Active share repurchases
Share Count Change (YoY)	879.9%	Warning	Net dilution from issuance/SBC
Total Capital Returned (TTM)	$9.9B	Good	Dividends + buybacks returned to shareholders

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Sector Rankings

Metric	Value	Percentile	vs Median
Return on Invested Capital (ROIC)	28.1%	Top 5%	4.9x above
Free Cash Flow Margin	23.1%	Top 5%	6.5x above
Gross Margin	49.1%	Top 50%	1.3x above
Operating Margin	29.7%	Top 5%	7.3x above
Return on Equity (ROE)	49.1%	Top 25%	4.9x above
P/E Ratio	31.2x	N/A	-

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Financial Scorecard

Metric	NFLX	Rating	Sector Context
Return on Invested Capital (ROIC)	28.1%	Excellent	Top 5% of sector (median: 5.8%)
Free Cash Flow Margin	23.1%	Excellent	Top 5% of sector (median: 3.5%)
Gross Margin	49.1%	Good	Top 50% of sector (median: 38.6%)
Debt to Equity Ratio	47.5%	Good	Moderate leverage
P/E Ratio (Price-to-Earnings)	31.2x	Adequate	Growth premium
Free Cash Flow Yield	3.8%	Adequate	Moderate yield

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Frequently Asked Questions

Q: What is NETFLIX INC's Return on Invested Capital (ROIC)?

NETFLIX INC (NFLX) has a trailing twelve-month Return on Invested Capital (ROIC) of 28.1%. The 8-quarter median ROIC is 28.4% with a improving trend. Sector median 5.8%. Source: 10-Q filed 2026-07-17.

Q: What is NETFLIX INC's Free Cash Flow Margin?

NETFLIX INC (NFLX) has a free cash flow margin of 23.1%, generating $11.2 billion in free cash flow over the trailing twelve months. Source: 10-Q filed 2026-07-17.

Q: What is NETFLIX INC's P/E ratio and how does it compare to peers?

NETFLIX INC (NFLX) trades at a P/E ratio of 31.2x, which is above the sector median of N/A. EV/Sales 6.1x. FCF yield 3.8%. Source: 10-Q filed 2026-07-17.

Q: What is NETFLIX INC's revenue and earnings growth?

NETFLIX INC (NFLX) grew revenue by 16.0% year-over-year. EPS +35.3% YoY. Source: 10-Q filed 2026-07-17.

Q: Is NETFLIX INC buying back stock?

NETFLIX INC (NFLX) repurchased $9.9 billion of stock over the trailing twelve months. This represents a buyback yield of 3.4%. Share count +879.9% YoY. Source: 10-Q filed 2026-07-17.

Q: How does NETFLIX INC compare to competitors in Consumer Discretionary?

Compared to other companies in Consumer Discretionary, NETFLIX INC (NFLX) shows: ROIC 28.1%, sector median 5.8% (Top 5%). FCF margin 23.1%, sector median 3.5% (Top 5%). Gross margin 49.1%, 10.5pp above sector median. These rankings are based on MetricDuck's analysis of all Consumer Discretionary companies with available SEC filings.

Q: What warning signs should I watch for with NETFLIX INC?

No quantitative warning flags fired for NETFLIX INC (NFLX) on margin trend, FCF trend, ROIC trend, or leverage thresholds. Source: 10-Q filed 2026-07-17.

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Data Source: Data sourced from 10-Q filed 2026-07-17. TTM metrics as of Q2 2026.

Methodology: Financial metrics calculated from SEC 10-K and 10-Q filings using standardized formulas. Sector comparisons use peer group based on SIC code.

Scope: This analysis covers SEC filing fundamentals — profitability, cash flow, balance sheet, and valuation metrics. For analyst estimates and price targets, consult sell-side research.

This analysis is for informational purposes only and does not constitute investment advice.