Now is a suitable time to hop back into Netflix Inc (NASDAQ: NFLX), says the Executive Chairman of Engine Media Inc. The stock is now down close to 75% versus the start of the year 2022.
Highlights from Tom Rogers’ interview on CNBC
Trouble mounted for the streaming giant last month after it warned it could lose up to 2 million subscribers this quarter. Still, Tom Rogers said this morning on CNBC’s “Squawk Box”:
You have 600 million cable satellite subscribers around the globe. Eventually, those are going to become streaming subscribers. And Netflix, in all likelihood, is your first streaming in, as those homes transition.
Earlier this week, Netflix said it will introduce a cheaper, ad-supported tier by the end of 2022 (sooner than expected) to drive consumer growth and boost revenue.
Netflix Inc stock is hugely undervalued
Netflix Inc is still the largest streaming service with the highest number of global subscribers. Rogers, therefore, dubs NFLX at about $165 per share a very undervalued stock. He noted:
Clearly, the path to 300 million to 400 million subscribers is going to be a slower one. But that path still creates a value for Netflix well above where it is today. So, my personal view of Netflix is that it’s hugely undervalued.
Last month, Ritholtz’ Josh Brown also said the Netflix stock around $200 a share had been very much “de-risked”. The stock trades at a PE multiple of 15.45 at present.
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