5 Best COVID Stocks To Buy Now

2. Netflix, Inc. (NASDAQ:NFLX)

Number of Hedge Fund Holders: 95

During COVID lockdowns, Netflix, Inc. (NASDAQ:NFLX) gained a lot of traffic and new accounts, as people had no alternative source of entertainment. Netflix, Inc. (NASDAQ:NFLX) is one of the best COVID stocks to buy now. On September 27, Netflix, Inc. (NASDAQ:NFLX) announced that it is launching an internal game studio in Finland in an effort to boost its gaming ambitions. 

On September 28, Atlantic Equities analyst Hamilton Faber upgraded Netflix, Inc. (NASDAQ:NFLX) to Overweight from Neutral with a price target of $283, up from $211. The upcoming ad-supported service launch “could be extremely material” and its benefit hasn’t been reflected in consensus estimates, the analyst told investors in a research note. The analyst thinks Netflix, Inc. (NASDAQ:NFLX) could drive average revenue per user of $26 per month from advertising, more than three times the level of Disney’s Hulu. 

Among the hedge funds tracked by Insider Monkey, Boykin Curry’s Eagle Capital Management is a notable position holder in Netflix, Inc. (NASDAQ:NFLX), with approximately 5.5 million shares worth $961.4 million. Overall, Netflix, Inc. (NASDAQ:NFLX) was part of 95 hedge fund portfolios at the end of June 2022. 

Here is what Artisan Partners specifically said about Netflix, Inc. (NASDAQ:NFLX) in its Q2 2022 investor letter:

“Netflix, Inc. (NASDAQ:NFLX) was the weakest among the group, down 53%. We initiated our position in Netflix in Q1 after shares fell by more than half due to concerns about subscriber growth and increasing competition from streaming upstarts. The stock then suffered a second down leg in April after the company reported subscriber losses for the first time in its history. As we write this letter in July, the company reported its second consecutive quarter of subscriber losses, but the nearly 1 million subscribers lost were much lower than the 2 million that management had forecast, and shares rallied on the news. For patient investors, there is reason for optimism that subscriber growth will turn around. The company has plans to crack down on password sharing and is launching a lower cost advertising supported tier in 2023. Our investment case is focused on an undemanding valuation, massive scale, a continued shift in time and attention from linear TV to streaming, and a financial condition which gives management the flexibility to operate unconstrained during a transition period for the business. We also believe Netflix can leverage its massive global scale of 221 million subscribers into positive free cash flow though steady pricing increases and content spending controls. We added to our position during the quarter.”