In this article, we discuss the 5 best streaming stocks to buy now. If you want to read our detailed analysis of the streaming industry and these stocks, go directly to 10 Best Streaming Stocks To Buy Now.
5. Comcast Corporation (NASDAQ:CMCSA)
Number of Hedge Fund Holders: 80
Comcast Corporation (NASDAQ:CMCSA) is up next on our list of the hottest streaming stocks to buy now. It provides cable and broadband services to millions across the United States, and also provides content streaming services through its Xfinity Stream platform, which recorded approximately 18 million subscribers at the end of 2021.
On April 29, Morgan Stanley analyst Benjamin Swinburne kept an ‘Overweight’ rating on Comcast Corporation (NASDAQ:CMCSA) shares and lowered the firm’s price target to $55 from $60. He sees the firm offering healthy growth in its free cash flow, EBITDA, and EPS whilst trading at deeply discounted valuations. The analyst sees Comcast Corporation (NASDAQ:CMCSA) as his top pick in the cable/satellite group.
Hedge funds were buying into Comcast Corporation (NASDAQ:CMCSA) at the close of the fourth quarter, where 80 reported bullish bets on the company shares with a collective price tag of $8.6 billion. In comparison, 75 hedge funds were long on the company shares in the preceding quarter.
For the first quarter of 2022, Comcast Corporation (NASDAQ:CMCSA) posted $31.01 billion in quarterly revenue, outperforming estimates by $602.5 million. EPS was recorded at $0.86, also exceeding analysts’ forecasts by $0.05.
4. The Walt Disney Company (NYSE:DIS)
Number of Hedge Fund Holders: 111
The Walt Disney Company (NYSE:DIS) is an entertainment giant which runs Disney+, which is one of the world’s leading streaming services with roughly 138 million subscribers. This figure has registered a growth of more than 100 million since the start of 2020, highlighting how The Walt Disney Company (NYSE:DIS) has consistently taken market share of the global streaming industry.
On May 12, Morgan Stanley analyst Benjamin Swinburne gave The Walt Disney Company (NYSE:DIS) an unchanged ‘Overweight’ rating and a price target of $170, noting that the latest quarterly results highlight the firm’s growth potential, with outperformance in Parks and streaming business Disney+. The analyst sees upside potential of more than 60% for the shares.
Investors were seen piling into The Walt Disney Company (NYSE:DIS) stock. 111 hedge funds held positions worth $6.94 billion in the firm at the close of Q4 2021. This is in comparison to 101 hedge funds with $9.41 billion worth of stakes in the firm a quarter ago. Matrix Capital Management held a $868 million stake in The Walt Disney Company (NYSE:DIS) at the end of Q1 2022, making it the firm’s largest shareholder.
Investment firm ClearBridge Investments discussed the prospects of The Walt Disney Company (NYSE:DIS) in its Q4 2021 investor letter, stating:
“The communication services sector was a weak spot in both the benchmark and the portfolio in the fourth quarter. Disney announced lower than expected streaming subscriber growth to the company’s Disney+ offering, attributable primarily to the content release schedule. Disney has been ramping up content spending given strong global response to Disney+, although production capability was temporarily impacted by COVID-19. We still believe Disney is on track to reach the subscriber outlook outlined at its December 2020 analyst day, driven by a very robust slate of content releases, particularly in the 2022–2024 time period.”
3. Netflix, Inc. (NASDAQ:NFLX)
Number of Hedge Fund Holders: 113
Netflix, Inc. (NASDAQ:NFLX) is the world’s leading streaming platform. Founded in 1997, the firm currently has roughly 222 million paying subscribers, and stood as the driving force behind the world’s transition from cinema-going to streaming entertainment content at home.
For the first quarter of 2022, Netflix, Inc. (NASDAQ:NFLX) reported losing subscribers for the first time in 10 years. This was a wake-up call for the company which no longer enjoys an unchallenged status in the highly competitive streaming industry.
However, Wedbush analyst Michael Pachter turned bullish on Netflix, Inc. (NASDAQ:NFLX) on May 16, and upgraded the shares to ‘Outperform’ from ‘Neutral’ with a $280 price target. The analyst notes that investor confidence in the firm will restore and subscribers will start growing again as soon as it tries to reduce the churn rate by releasing new content over several weeks. The analyst believes Netflix shares present a compelling investment opportunity, and sees it only gradually raising prices and launching its ad-supported option.
Investors were bullish on Netflix, Inc. (NASDAQ:NFLX) shares at the end of Q4 2021, where 113 hedge funds held stakes in the company as compared to 106 hedge funds in the previous quarter. According to its Q1 2022 portfolio, Ken Fisher’s Fisher Asset Management was the largest shareholder of Netflix, Inc. (NASDAQ:NFLX), with 6.35 million shares worth $2.38 billion, showing an uptick of 18% in holding over the preceding quarter.
Here is what investment firm ClearBridge Investments had to say about Netflix, Inc. (NASDAQ:NFLX) in its Q1 2022 investor letter:
“After being a prime beneficiary of increased viewing patterns during the stay-at-home period of COVID-19, Netflix is recalibrating what a normal growth trajectory will look like as global economies fully reopen. The stock fell sharply after the company modestly reduced its net subscriber additions for the current quarter, calling into question its ability to continue to deliver double-digit subscriber growth.
We believe one of our edges as active managers is our long-term orientation and willingness to be both early and patient with additions to the portfolio. With Netflix, we remain convinced that our thesis for owning the stock is intact. While some fear the U.S. streaming market is becoming saturated, Netflix’s penetration of global broadband homes is still less than 50%, a figure that doesn’t even include the opportunity to attract more mobile-only smartphone users.”
2. Apple Inc. (NASDAQ:AAPL)
Number of Hedge Fund Holders: 134
Apple Inc. (NASDAQ:AAPL) is the Cupertino-based tech giant which revolutionized the world with its Mac computers and iPhones. In recent times, Apple has made successful forays into the streaming world with its Apple TV platform, and has reaped the benefits of producing high-quality content, with the first-ever Oscar win for a film originally produced by a streaming platform.
On April 29, Deutsche Bank analyst Sidney Ho reiterated a ‘Buy’ rating on Apple Inc. (NASDAQ:AAPL) shares, and revised the price target to $200 from $210. The analyst notes that latest quarterly results show continued strength in demand for Apple’s products and services, although uncertainty in China led to increased supply-chain issues. Regardless, she views the firm as a “high-quality” name in the market, and thinks its premium valuation is justified as compared to tech hardware peers.
For the first quarter, Apple Inc. (NASDAQ:AAPL) posted EPS of $1.52, outperforming estimates by $0.09. The company raked in $97.3 billion in revenue for the quarter, exceeding analysts’ forecasts by $3.3 billion. As of May 17, shares of Apple Inc. (NASDAQ:AAPL) have gained 19.54% in the last 12 months.
Out of all the hedge funds tracked by Insider Monkey, 134 reported holding stakes in Apple Inc. (NASDAQ:AAPL) at the end of Q4 2021, with a combined worth of $18.6 billion. This shows growing investor confidence in the firm over the previous quarter, where 120 hedge funds were long on the company shares. Apple Inc. (NASDAQ:AAPL) shares comprised 42.78% of Berkshire Hathaway‘s Q1 2022 portfolio with a $155.6 billion stake, making it the largest shareholder of the firm.
Investment firm ClearBridge Investments talked about the prospects of Apple Inc. (NASDAQ:AAPL) in its Q4 2021 investor letter. The fund said:
“Despite these mixed emerging growth results, the ClearBridge Global Growth Strategy outperformed the benchmark due to resilience among our secular and structural growth holdings. The bulk of these contributions came from U.S. mega-cap growth stocks Apple and Microsoft which continued to uniquely act both offensively and defensively as they have through most of the pandemic.”
1. Amazon.com, Inc. (NASDAQ:AMZN)
Number of Hedge Fund Holders: 279
Amazon.com, Inc. (NASDAQ:AMZN) ranks first on our list of the best streaming stocks to buy. The e-commerce giant offers a wide range of entertainment content through its Amazon Prime Video platform, which has approximately 175 million subscribers from around the world.
UBS analyst Lloyd Walmsley in late April kept a ‘Buy’ rating on Amazon.com, Inc. (NASDAQ:AMZN) stock, noting that it is trading at attractive valuations of 50.2x earnings and 13.6x expected EBITDA for 2023. He sees the company as a compelling option for consumers in the current high inflationary environment, given its quick delivery, price and product selection.
Of the 924 elite hedge funds tracked by Insider Monkey, Amazon.com, Inc. (NASDAQ:AMZN) was the most widely-held stock with 279 bullish hedge funds bets reported at the end of the fourth quarter. This shows improving investor confidence over the previous quarter where 242 hedge funds held stakes in the company.
Here is what investment firm Miller Value Partners had to say about Amazon.com, Inc. (NASDAQ:AMZN) in its Q1 2022 investor letter:
“For frame of reference, Amazon (NASDAQ:AMZN) bottomed at the same valuation in the financial crisis (side note: Amazon bottomed at 4x EV/GP after the tech bubble burst)! So there’s historical precedent for the lows being in. We will see whether that holds true this time. Regardless, we think there’s significant upside over a 5-year time horizon. The one other topic I want to briefly address is our volatility. We hope to write something about the topic in more depth in the future, but we want our clients and prospective investors to understand our views on it. We think that volatility is significantly misunderstood. We believe it creates opportunities from which we can profit.”
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