Polen Capital, an investment management company, released its “Polen Focus Growth Strategy” fourth-quarter 2022 investor letter. A copy of the same can be downloaded here. The fund returned -0.28% net in the fourth quarter compared to a 2.20% return for the Russell 1000 Growth Index and a 7.41% return for the S&P 500 Index. In 2022, the fund returned -38.02% net compared to -29.14% and -18.22% returns for the Russell and the S&P 500 Indexes, respectively. Inflation, the Fed’s interest rate hikes, and revenue and earnings slowdowns of the fund’s holding companies led the fund to underperform in the quarter and the year. In addition, please check the fund’s top five holdings to know its best picks in 2022.
Polen Capital highlighted stocks like Netflix, Inc. (NASDAQ:NFLX) in the Q4 2022 investor letter. Headquartered in Los Gatos, California, Netflix, Inc. (NASDAQ:NFLX) is a streaming platform. On January 18, 2023, Netflix, Inc. (NASDAQ:NFLX) stock closed at $326.33 per share. One-month return of Netflix, Inc. (NASDAQ:NFLX) was 9.60%, and its shares lost 35.79% of their value over the last 52 weeks. Netflix, Inc. (NASDAQ:NFLX) has a market capitalization of $145.223 billion.
Polen Capital made the following comment about Netflix, Inc. (NASDAQ:NFLX) in its Q4 2022 investor letter:
“Netflix, Inc. (NASDAQ:NFLX) has nearly doubled since its May 2022 lows and was our top performer for both the quarter and the year. In the summer, we added to our position meaningfully after our research indicated that the company’s two new monetization levers (requiring fees for shared passwords and the introduction of an advertising-supported subscription) would be very additive to the company’s revenue and profits beginning in early 2023. The company has since announced plans to disallow password sharing, which should provide a boost to revenue and profit growth nearly immediately as account holders or those that are borrowing passwords are required to pay to continue to watch Netflix content. The ad-supported subscription tier should also be a clear positive, not only for the company’s financials but also for consumers and marketers alike. While the subscription fee for the ad-supported tier is only about $7/month in the U.S., the ad revenue per subscriber that Netflix earns for consumers choosing this option could easily add another $15 per month or more in the U.S., potentially making Netflix’s ad-supported subscription tier the company’s most revenue generative and profitable. Even if more premium subscribers than expected downgrade to the adsupported option, we think there should be significant revenue uplift for Netflix. It appears market participants have been doing this math as well, driving the stock price higher over the last seven months.”
Photo by Thibault Penin on Unsplash
Netflix, Inc. (NASDAQ:NFLX) is in 19th position on our 30 Most Popular Stocks Among Hedge Funds list. As per our database, 115 hedge fund portfolios held Netflix, Inc. (NASDAQ:NFLX) at the end of the third quarter, which was 95 in the previous quarter.
We discussed Netflix, Inc. (NASDAQ:NFLX) in another article and shared the list of best mineral stocks. In addition, please check out our hedge fund investor letters Q4 2022 page for more investor letters from hedge funds and other leading investors.
Suggested Articles:
- 9 Famous Pyramid Schemes in US History
- 12 Best DRIP Stocks To Own
- 15 Largest Plastic Manufacturing Companies in the World
Disclosure: None. This article is originally published at Insider Monkey.
