Common Stock Valuation Ratios (Price Multiples)
Valuation ratios measure the quantity of an asset or flaw (e.g., earnings) associated with ownership of a specified claim (e.g., a share of ownership of the enterprise).
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- Balance Sheet: Assets
- Cash Flow Statement
- Common-Size Balance Sheet: Liabilities and Stockholders’ Equity
- Analysis of Profitability Ratios
- Analysis of Solvency Ratios
- Analysis of Short-term (Operating) Activity Ratios
- Present Value of Free Cash Flow to Equity (FCFE)
- Return on Equity (ROE) since 2005
- Current Ratio since 2005
- Price to Book Value (P/BV) since 2005
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Current Valuation Ratios
Netflix Inc., current price multiples
| Netflix Inc. | Alphabet Inc. | Comcast Corp. | Meta Platforms Inc. | Take-Two Interactive Software Inc. | Walt Disney Co. | Media & Entertainment | Communication Services | ||||
|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data | |||||||||||
| Current share price (P) | |||||||||||
| No. shares of common stock outstanding | |||||||||||
| Growth rate (g) | |||||||||||
| Earnings per share (EPS) | |||||||||||
| Next year expected EPS | |||||||||||
| Operating profit per share | |||||||||||
| Sales per share | |||||||||||
| Book value per share (BVPS) | |||||||||||
| Valuation Ratios (Price Multiples) | |||||||||||
| Price to earnings (P/E) | |||||||||||
| Price to next year expected earnings | |||||||||||
| Price-earnings-growth (PEG) | |||||||||||
| Price to operating profit (P/OP) | |||||||||||
| Price to sales (P/S) | |||||||||||
| Price to book value (P/BV) | |||||||||||
Based on: 10-K (reporting date: 2024-12-31).
If the company price multiple is lower then the price multiple of benchmark then company stock is relatively undervalued.
Otherwise, if the company price multiple is higher then the price multiple of benchmark then company stock is relatively overvalued.
Historical Valuation Ratios (Summary)
Netflix Inc., historical price multiples
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Price to earnings (P/E) | ||||||
| Price to operating profit (P/OP) | ||||||
| Price to sales (P/S) | ||||||
| Price to book value (P/BV) |
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
- Price to Earnings (P/E) Ratio
- The Price to Earnings ratio experienced a significant decline from 86.39 at the end of 2020 to 33.56 by the end of 2021, indicating a substantial reduction in investor price expectations relative to earnings. This ratio remained relatively stable in 2022 at 36.17 before increasing again in 2023 and 2024, reaching 45.65 and 47.72 respectively. This upward trend over the last two years suggests growing investor confidence or improved earnings growth expectations during this period.
- Price to Operating Profit (P/OP) Ratio
- The Price to Operating Profit ratio followed a similar trend to the P/E ratio, dropping from 52.02 in 2020 to 27.71 in 2021. It held steady with a slight increase to 28.85 in 2022 before rising more noticeably in 2023 and 2024 to 35.5 and 39.91 respectively. This pattern indicates a recovery in the market’s valuation relative to operating profits, pointing to enhanced operational performance or investor optimism over these years.
- Price to Sales (P/S) Ratio
- There was a consistent decline in the Price to Sales ratio from 9.54 in 2020 to a low of 5.14 in 2022, reflecting a decreasing market valuation relative to sales during this period. However, the ratio rebounded sharply in 2023 to 7.32 and further increased to 10.66 in 2024, surpassing the 2020 level. This indicates that sales valuation improved significantly in the most recent years, likely due to increased revenue growth or improved market sentiment.
- Price to Book Value (P/BV) Ratio
- The Price to Book Value ratio showed a steady decline from 21.56 in 2020 to 7.82 in 2022, demonstrating a substantial reduction in market valuation relative to book equity. From 2023 onwards, the ratio rose notably, reaching 11.99 in 2023 and 16.8 in 2024. This upward trend suggests an enhanced market appraisal of the company’s net asset value or improved equity returns over the last two years.
Overall, the financial ratios indicate a period of valuation decline spanning 2020 to 2022, followed by a recovery and improvement in market valuation multiples in 2023 and 2024 across all metrics. This pattern may reflect initial market uncertainty or weaker financial performance, with a subsequent phase of improved earnings, operating profits, sales, and book value driving renewed investor confidence.
Price to Earnings (P/E)
Netflix Inc., historical P/E calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| No. shares of common stock outstanding1 | ||||||
| Selected Financial Data (US$) | ||||||
| Net income (in thousands) | ||||||
| Earnings per share (EPS)2 | ||||||
| Share price1, 3 | ||||||
| Valuation Ratio | ||||||
| P/E ratio4 | ||||||
| Benchmarks | ||||||
| P/E Ratio, Competitors5 | ||||||
| Alphabet Inc. | ||||||
| Comcast Corp. | ||||||
| Meta Platforms Inc. | ||||||
| Take-Two Interactive Software Inc. | ||||||
| Walt Disney Co. | ||||||
| P/E Ratio, Sector | ||||||
| Media & Entertainment | ||||||
| P/E Ratio, Industry | ||||||
| Communication Services | ||||||
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 Data adjusted for splits and stock dividends.
2 2024 Calculation
EPS = Net income ÷ No. shares of common stock outstanding
= ÷ =
3 Closing price as at the filing date of Netflix Inc. Annual Report.
4 2024 Calculation
P/E ratio = Share price ÷ EPS
= ÷ =
5 Click competitor name to see calculations.
- Share Price
- The share price exhibited significant fluctuations over the analyzed period. Starting at 538.6 US dollars at the end of 2020, it decreased notably to 386.7 US dollars by the end of 2021 and further declined to 364.87 US dollars at the end of 2022. However, the subsequent years saw a strong recovery with the share price increasing to 570.42 US dollars in 2023 and reaching a substantially higher value of 971.89 US dollars by the end of 2024.
- Earnings per Share (EPS)
- The EPS demonstrated a consistent upward trend throughout the period. It increased from 6.23 US dollars at the end of 2020 to 11.52 US dollars in 2021, representing a near doubling. Although there was a slight decrease to 10.09 US dollars in 2022, the EPS rebounded in the following years, reaching 12.5 US dollars in 2023 and further increasing to 20.37 US dollars by the end of 2024. This indicates improving profitability over time despite minor fluctuations.
- Price-to-Earnings (P/E) Ratio
- The P/E ratio showed a declining trend initially, dropping sharply from a high level of 86.39 in 2020 to 33.56 in 2021. It then experienced a moderate increase to 36.17 in 2022, followed by a more significant rise to 45.65 in 2023 and further to 47.72 in 2024. This pattern suggests a decreasing valuation relative to earnings initially, followed by a renewed premium on the company's earnings in the latter part of the period.
- Summary Insights
- Overall, the share price and EPS trends indicate strong earnings growth accompanied by heightened market valuation in recent years, despite an initial downturn in the share price and P/E ratio. The recovery and substantial increase in share price in 2023 and 2024 align with the increased EPS and a rising P/E ratio, reflecting increased investor confidence and a willingness to pay more for each unit of earnings. The initially high P/E in 2020, followed by a sharp drop, could signal market concerns that were later alleviated, as evidenced by the subsequent recovery in valuation metrics.
Price to Operating Profit (P/OP)
Netflix Inc., historical P/OP calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| No. shares of common stock outstanding1 | ||||||
| Selected Financial Data (US$) | ||||||
| Operating income (in thousands) | ||||||
| Operating profit per share2 | ||||||
| Share price1, 3 | ||||||
| Valuation Ratio | ||||||
| P/OP ratio4 | ||||||
| Benchmarks | ||||||
| P/OP Ratio, Competitors5 | ||||||
| Alphabet Inc. | ||||||
| Comcast Corp. | ||||||
| Meta Platforms Inc. | ||||||
| Take-Two Interactive Software Inc. | ||||||
| Walt Disney Co. | ||||||
| P/OP Ratio, Sector | ||||||
| Media & Entertainment | ||||||
| P/OP Ratio, Industry | ||||||
| Communication Services | ||||||
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 Data adjusted for splits and stock dividends.
2 2024 Calculation
Operating profit per share = Operating income ÷ No. shares of common stock outstanding
= ÷ =
3 Closing price as at the filing date of Netflix Inc. Annual Report.
4 2024 Calculation
P/OP ratio = Share price ÷ Operating profit per share
= ÷ =
5 Click competitor name to see calculations.
- Share Price
- The share price experienced a significant decline from 538.6 US$ at the end of 2020 to 364.87 US$ by the end of 2022. However, this downward trend reversed in the subsequent years, with a notable increase to 570.42 US$ in 2023 followed by a sharp rise to 971.89 US$ in 2024. This pattern indicates a period of initial market pessimism or external challenges, followed by renewed investor confidence and strong market valuation growth.
- Operating Profit Per Share
- Operating profit per share showed growth from 10.35 US$ in 2020 to 13.95 US$ in 2021, signaling an improvement in operational profitability. There was a slight dip to 12.65 US$ in 2022, but profitability recovered strongly in the following years, reaching 16.07 US$ in 2023 and a substantial increase to 24.35 US$ in 2024. The fluctuations suggest some operational challenges or investments occurred around 2022, followed by more efficient operations or higher earnings generation capacity.
- Price to Operating Profit Ratio (P/OP)
- The P/OP ratio was highest at 52.02 in 2020, which means the share price was valued at over 52 times the operating profit per share. This ratio dropped substantially to approximately 28 in 2021 and 2022, indicating the market valuation became more aligned with the company's operating profitability during this period. From 2023 onwards, the ratio increased again, reaching 35.5 and then 39.91 in 2024, reflecting a growing premium placed on the company’s earnings despite the higher operating profits. This might be associated with positive future growth expectations or improved market sentiment.
Price to Sales (P/S)
Netflix Inc., historical P/S calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| No. shares of common stock outstanding1 | ||||||
| Selected Financial Data (US$) | ||||||
| Revenues (in thousands) | ||||||
| Sales per share2 | ||||||
| Share price1, 3 | ||||||
| Valuation Ratio | ||||||
| P/S ratio4 | ||||||
| Benchmarks | ||||||
| P/S Ratio, Competitors5 | ||||||
| Alphabet Inc. | ||||||
| Comcast Corp. | ||||||
| Meta Platforms Inc. | ||||||
| Take-Two Interactive Software Inc. | ||||||
| Walt Disney Co. | ||||||
| P/S Ratio, Sector | ||||||
| Media & Entertainment | ||||||
| P/S Ratio, Industry | ||||||
| Communication Services | ||||||
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 Data adjusted for splits and stock dividends.
2 2024 Calculation
Sales per share = Revenues ÷ No. shares of common stock outstanding
= ÷ =
3 Closing price as at the filing date of Netflix Inc. Annual Report.
4 2024 Calculation
P/S ratio = Share price ÷ Sales per share
= ÷ =
5 Click competitor name to see calculations.
The financial data over the five-year period reveals several notable trends in the key performance indicators analyzed.
- Share Price
- The share price initially declined from $538.6 at the end of 2020 to $364.87 by the end of 2022. However, it experienced a significant recovery thereafter, rising to $570.42 in 2023 and sharply increasing to $971.89 by the end of 2024. This pattern suggests a period of correction or market skepticism followed by renewed investor confidence and strong valuation growth.
- Sales per Share
- Sales per share exhibited consistent growth throughout the entire period, increasing from $56.44 in 2020 to $91.18 in 2024. This steady upward trend indicates ongoing revenue expansion on a per-share basis, reflecting either increased total sales or share count management favorable to shareholders.
- Price-to-Sales (P/S) Ratio
- The P/S ratio showed a declining trend from 9.54 in 2020 down to 5.14 in 2022, mirroring the downward trend in the share price during that timeframe. Subsequently, the ratio reversed direction, increasing to 7.32 in 2023 and reaching a peak of 10.66 in 2024. This rebound in valuation multiples may imply improved market sentiment, expectations of higher future growth, or enhanced profitability prospects.
Overall, the data indicates that despite early declines in market valuation metrics, the company demonstrated consistent sales growth per share. The marked recovery in share price and expansion of the P/S ratio in the latter years points to strengthened investor confidence and potentially more favorable business fundamentals driving those perceptions.
Price to Book Value (P/BV)
Netflix Inc., historical P/BV calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| No. shares of common stock outstanding1 | ||||||
| Selected Financial Data (US$) | ||||||
| Stockholders’ equity (in thousands) | ||||||
| Book value per share (BVPS)2 | ||||||
| Share price1, 3 | ||||||
| Valuation Ratio | ||||||
| P/BV ratio4 | ||||||
| Benchmarks | ||||||
| P/BV Ratio, Competitors5 | ||||||
| Alphabet Inc. | ||||||
| Comcast Corp. | ||||||
| Meta Platforms Inc. | ||||||
| Take-Two Interactive Software Inc. | ||||||
| Walt Disney Co. | ||||||
| P/BV Ratio, Sector | ||||||
| Media & Entertainment | ||||||
| P/BV Ratio, Industry | ||||||
| Communication Services | ||||||
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 Data adjusted for splits and stock dividends.
2 2024 Calculation
BVPS = Stockholders’ equity ÷ No. shares of common stock outstanding
= ÷ =
3 Closing price as at the filing date of Netflix Inc. Annual Report.
4 2024 Calculation
P/BV ratio = Share price ÷ BVPS
= ÷ =
5 Click competitor name to see calculations.
The financial data exhibits notable trends in the share price, book value per share (BVPS), and price-to-book value (P/BV) ratio over the five-year period.
- Share Price
- The share price experienced a significant decline from 538.6 US$ at the end of 2020 to 364.87 US$ by the end of 2022. However, it rebounded strongly in the subsequent years, reaching 570.42 US$ at the end of 2023 and further increasing to 971.89 US$ by the end of 2024. This indicates substantial volatility with a marked recovery and growth in market valuation in the latter years.
- Book Value per Share (BVPS)
- The BVPS demonstrated consistent growth throughout the period, rising from 24.98 US$ in 2020 to 57.84 US$ in 2024. The increase was relatively steady, reflecting an expanding net asset base per share, with the most notable growth occurring between 2023 and 2024.
- Price-to-Book Value (P/BV) Ratio
- The P/BV ratio showed a downward trend from 21.56 in 2020 to a low of 7.82 in 2022, indicating the share price declined faster than the book value during this interval. Following 2022, the P/BV ratio rose again to 16.8 by 2024, mirroring the recovery and strong share price appreciation relative to the book value. Despite this rebound, the ratio in 2024 remained below the initial 2020 level, suggesting a somewhat more moderate market premium over book value compared to the start of the period.