Bill Ackman's investment firm Pershing Square has marked a return to the Netflix stock register four years after exiting a position with a $400 million loss. Pershing Square previously held Netflix, the streaming company, briefly in 2022 before selling out at a loss.
Bill Ackman is back in Netflix. In April 2022, Pershing Square dumped its stake at a reported loss of about $400 million after a subscriber miss cratered the shares.
Netflix shares have had a rough year. Some well-known investors have been buying the dip.
Netflix NFLX stock rose more than 4% on Thursday after billionaire investor Bill Ackman's Pershing Square Capital Management disclosed a new stake in the streaming giant, marking a return to the company more than four years after exiting its previous investment at a loss. In its second-quarter shareholder letter, Pershing Square revealed it had acquired a 4.9% portfolio stake in Netflix.
The billionaire said he believes the firms' earnings are poised for strong growth, which he views as the greatest driver of investment value over time.
NFLX's resilient revenues, rising margins and $3B ad opportunity support a hold despite its 20.9% YTD drop and premium valuation.
Netflix (NFLX) trades at ~20x forward earnings, with the market underestimating its monetization strategy despite slowing revenue growth to ~12% by Q3 2026. NFLX's new Ads Suite, pricing power, and disciplined margin management are driving a shift from subscriber acquisition to monetizing its 325 million-member base. Management targets double-digit earnings growth, supported by ad revenue, pricing, and margin levers, with share repurchases prioritized over large acquisitions.
Netflix is once again an apple in Bill Ackman's eye, as the streamer was among six stocks Pershing Square added in the last six months.
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Netflix (NASDAQ:NFLX | NFLX Price Prediction) has taken a beating over the past year, and the sell-off has flipped a growth darling into a value debate.
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