Bill Ackman and his hedge fund, Pershing Square Capital Management, recently disclosed that it increased its stake in Netflix (NASDAQ: NFLX). The last time Ackman's funds owned Netflix, all the way back in 2022, the position was exited at a hefty loss. The new thesis is simple: Netflix is officially the champion of the streaming wars, and the entertainment company is now positioned to grow even more.
Is he right, and should retail investors follow suit? This Rare Signal Is Flashing Again. In 2009, a "Double Down" signal flashed for a little-known chipmaker called Nvidia.
For the first time in years, that same "Total Conviction" signal is flashing for a company 1/100th the size of Nvidia. Continue » The case for buying Netflix is strong. If we look at Netflix's valuation and price, the stock has fallen more than 30% over the past 12 months, bringing down its forward and trailing P/E ratios to 24.
The streaming giant is trading at less than 7 times its sales. The metrics are appealing right now, particularly at a moment when its profitability is improving and its ambitions are expanding. Netflix is diversifying its offerings beyond just film and television.
Podcasts, live events, and gaming are introducing Netflix to new audiences and deepening engagement among current subscribers. It's also using localized content to help grow its international subscriber base. Buying Netflix isn't without risks.
It is a highly competitive market where new streamers can quickly steal subscribers' attention. But Netflix has an advantage in its sheer size and reach. In the second quarter of 2026, Netflix revenue grew 13% year over year overall, with 21% growth in Latin America and 16% in Asia-Pacific, specifically.
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