NETFLIX INC (NFLX) Stock Analysis

Analysis from 10-Q filed 2025-10-22. 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 2025-10-22.

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 6.9%, Top 5%. DuPont: NOPAT margin 24.6% × asset turnover 0.9x. Gross margin 49.1%. Operating margin 29.7%. Source: 10-Q filed 2025-10-22.

Metric	NFLX	Rating	Context
Return on Invested Capital (ROIC)	28.1%	Excellent	Above sector median of 6.9%
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 2025-10-22.

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

Debt/Equity 0.5x. Total debt $14.3B, cash & investments $9.1B. Source: 10-Q filed 2025-10-22.

Metric	NFLX	Rating	Context
Debt to Equity	0.5x	Good	Conservative capital structure
Net Cash Position	$-5.2B	Warning	Net debt position

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Valuation: NETFLIX INC trades at 14.6x earnings

P/E 14.6x. EV/Sales 9.1x. FCF yield 5.6%. Source: 10-Q filed 2025-10-22.

Metric	NFLX	Rating	Context
P/E Ratio	14.6x	Adequate	Reasonable valuation
EV/Sales	9.1x	Adequate	Growth premium priced in
FCF Yield	5.6%	Good	Attractive cash return

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Capital Allocation: NETFLIX INC returns 5.0% shareholder yield

Total shareholder yield 5.0% (buyback 5.0%). Capital returned $9.9B TTM. Source: 10-Q filed 2025-10-22.

Metric	NFLX	Rating	Context
Total Shareholder Yield	5.0%	Good	Dividend + buyback yield combined
Buyback Yield	5.0%	Good	Active share repurchases
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%	4.0x above
Free Cash Flow Margin	23.1%	Top 5%	9.8x above
Gross Margin	49.1%	Top 50%	1.3x above
Operating Margin	29.7%	Top 5%	7.0x above
Return on Equity (ROE)	49.1%	Top 10%	4.5x above
P/E Ratio	14.6x	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: 6.9%)
Free Cash Flow Margin	23.1%	Excellent	Top 5% of sector (median: 2.4%)
Gross Margin	49.1%	Good	Top 50% of sector (median: 38.7%)
Debt to Equity Ratio	47.5%	Good	Moderate leverage
P/E Ratio (Price-to-Earnings)	14.6x	Adequate	Attractively valued
Free Cash Flow Yield	5.6%	Good	Solid cash 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%. Sector median 6.9%. Source: 10-Q filed 2025-10-22.

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 2025-10-22.

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 14.6x, which is above the sector median of N/A. EV/Sales 9.1x. FCF yield 5.6%. Source: 10-Q filed 2025-10-22.

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 2025-10-22.

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 5.0%. Source: 10-Q filed 2025-10-22.

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 6.9% (Top 5%). FCF margin 23.1%, sector median 2.4% (Top 5%). Gross margin 49.1%, 10.4pp 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 2025-10-22.

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Data Source: Data sourced from 10-Q filed 2025-10-22. 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.