5 Best Media and Entertainment Stocks to Buy Now

3-NFLX

Number of Hedge Fund Holders: 109

Who would have guessed that Netflix would fall from $700 to $162 in less than a year? Hedge funds believe the recent softness in Netflix shares is a buying opportunity.

Here is what Oakmark Fund has to say about Netflix, Inc. (NASDAQ:NFLX) in its Q2 2022 investor letter:

“Netflix‘s stock price was down considerably after providing a weaker than expected outlook for both subscriber growth and profit margins. After meeting with management and scrutinizing our investment thesis, we lowered our estimate of business value to account for the company’s softer near-term guidance. However, we believe the decline in the company’s share price more than adjusts for this. Indeed, Netflix now trades for a discount to the S&P 500 Index on next year’s GAAP earnings despite our view that the company remains a much better than average business run by a highly accomplished management team. We believe the company’s lead in streaming remains intact and we expect terminal operating margins to be substantially higher than they are today. Furthermore, we are encouraged by Netflix’s potential to enhance revenue growth through advertising, the monetization of password sharing and further penetrating international markets.”