The impressive performance of the market has generated many trillion dollar companies. Because of their incredible success, these businesses have mostly achieved their position within elite groups.
a Market capitalization Of the $434 billion, it is rapidly increasing the ranks. It is worth debating as a possible future participation in a trillion dollar crew.
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Can this one unstoppable stock be combined? apple, Microsoft, nvidia, Amazon, alphabet, Metaand Tesla With a trillion dollar club by 2035?
Dominate the streaming landscape
Over the past 10 years, stocks Netflix (NASDAQ: NFLX) It has skyrocketed by 1,500%. That rise comes from the company’s impressive work to disrupt the media industry. Netflix has created a streaming category. And by focusing on innovation to better serve consumers in the Internet age, we can mention it in the same breath as other dominant high-tech titans.
Growth is an important part of the story. Netflix has 320 million subscribers in 190 countries around the world. That’s increased from the 167 million members five years ago. This driven revenue, up 15.6% in 2024.
The company continues to find ways to attract a larger audience. An example of the management-taking steps of platform monetization, as well as the successful launch of a cheaper ad support tier. Another option is to participate in live events and sports to boost engagement.
The ability to generate profits is exceptional. This is possible only because Netflix’s large scale results from the benefits of first driving.
Management is aiming for a 29% operating margin this year. Free cash flow It was projected at $8 billion. Executives focus on spending efficiently on content.
And it’s no surprise that Netflix’s financial situation continues to improve with its proven pricing power. It was able to consistently raise the subscription price because it was worth it to the audience. It’s a great feature.
Run the numbers
For Netflix’s market capitalization to reach $1 trillion in 10 years, it needs to expand by 130%. Over the past decade, market capitalization has risen by 1,500%. That’s why investors are demanding a big slowdown to hit that milestone. That’s reasonable to say the least.
Evaluations should also be considered. At the time of writing, share trade in a Price vs. Revenue (P/E) 50.9. Assuming multiples will be cut from half to 25 by 2035 (I don’t think this is out of the question given that Netflix will become a much more mature company in 10 years), this is per share Revenue (EPS) means you need it to increase by about 16.5% per year.
Over the past decade, EPS has increased at a combined annual rate of 41.4%. So, based on its current trajectory, I think it’s very likely that the company will actually be joining an exclusive $1 trillion club in 10 years.
be patient
Just because a business is on the way to be valued in a 13-digit total doesn’t mean you need to rush to buy the stock. To be clear, I still consider my current ratings to be on the expensive side.
Yes, business is thriving now. However, P/E does not leave any margin of safety for investors. Netflix needs to continue doing perfectly without hiccups to justify paying a steep price tag. The best thing investors should do is wait for a better entry point before purchasing this industry-leading company.
Should I invest $1,000 in Netflix now?
Consider this before purchasing stock on Netflix.
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Randi Zuckerberg, a former director of market development, Facebook spokeswoman and sister to Metaplatform CEO Mark Zuckerberg, is a member of Motley Fool’s board of directors. John Mackey, former CEO of Amazon subsidiary Whole Foods Market, is a member of Motley Fool’s board of directors. Suzanne Frey, an executive at Alphabet, is a member of the board of directors of Motley Fool. Neil Patel has no position in any of the stocks mentioned. Motley Fool has positions for Alphabet, Amazon, Apple, Meta Platforms, Microsoft, Netflix, Nvidia and Tesla, and is recommended. Motley Fool recommends the following options: A $395 phone at Microsoft for January 2026 length and a $405 phone to Microsoft for January 2026 short term. Motley Fools have a disclosure policy.
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