RiverPark Advisors, an investment advisory firm and sponsor of the RiverPark family of mutual funds, released its “RiverPark Large Growth Fund” third quarter 2023 investor letter. A copy of the same can be downloaded here. In the third quarter, markets performed poorly, and the S&P 500 index (“S&P”) and the Russell 1000 Growth Index (RLG) declined -3.27% and -3.13%, respectively and Institutional Class (RPX) declined -4.11%. Year to date, RPX has returned 26.59% compared to the SPX and the RLG’s 13.07% and 24.98% returns, respectively. In addition, please check the fund’s top five holdings to know its best picks in 2023.
RiverPark Advisors highlighted stocks like Netflix, Inc. (NASDAQ:NFLX) in the third quarter 2023 investor letter. Headquartered in Los Gatos, California, Netflix, Inc. (NASDAQ:NFLX) is a streaming platform. On November 16, 2023, Netflix, Inc. (NASDAQ:NFLX) stock closed at $466.95 per share. One-month return of Netflix, Inc. (NASDAQ:NFLX) was 16.46%, and its shares gained 62.15% of their value over the last 52 weeks. Netflix, Inc. (NASDAQ:NFLX) has a market capitalization of $204.375 billion.
RiverPark Advisors made the following comment about Netflix, Inc. (NASDAQ:NFLX) in its Q3 2023 investor letter:
“Netflix, Inc. (NASDAQ:NFLX): NFLX was a top detractor in the quarter on weaker than expected reported and guided revenue, despite 2Q subscriber growth that was well above expectations (+5.9 million versus estimates of +2.1 million). The company’s subscriber growth re-accelerated following the company’s crack down on password sharing, and the rollout of the advertising supported subscriber offering known as the Ad Tier, but the average revenue per user came in below expectations and is expected to remain muted in the near term. NFLX reiterated expectations for full year 2023 operating margins of 18-20%, and guided free cash flow to at least $5 billion, up from prior guidance of $3.5 billion. Despite the positive momentum in the company’s business, market participants took comments from management at a recent conference to mean revenue growth may be slower in the coming years than expected. This was not our interpretation of these comments.
In fact, the recent re-acceleration of subscriber growth, plus price increases on premium memberships and a stabilization of content investments, should position the company for low double digit annual revenue growth over the next few years while driving improved operating margin to more than 25% (revenue grew 3% for 2Q23 and operating margin was 22.3%, up from 13% in 2019). We also believe that the stabilization of content spend should allow the company to continue to scale its FCF.”
Pixabay/Public Domain
Netflix, Inc. (NASDAQ:NFLX) is in 12th position on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 114 hedge fund portfolios held Netflix, Inc. (NASDAQ:NFLX) at the end of second quarter which was 108 in the previous quarter.
We discussed Netflix, Inc. (NASDAQ:NFLX) in another article and shared the list of best Q3 earnings reports that crushed estimates. In addition, please check out our hedge fund investor letters Q3 2023 page for more investor letters from hedge funds and other leading investors.
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Disclosure: None. This article is originally published at Insider Monkey.
