Is it a Good Time Now to Dispose Your Netflix (NFLX) Shares?

IP Capital Partners, an investment management firm, published its second quarter 2022 investor letter – a copy of the Spanish document can be downloaded here. Following its philosophy and rationality as always, the fund consciously kept away from these niche markets. As the fear has spread, however, even the stocks of good companies have suffered – albeit to a lesser extent. Go over the fund’s top 5 positions to have a glimpse of its finest picks for 2022.

In its Q2 2022 investor letter, IP Capital Partners mentioned Netflix, Inc. (NASDAQ:NFLX) and explained its insights for the company. Founded in 1997, Netflix, Inc. (NASDAQ:NFLX) is a Los Gatos, California-based subscription streaming service and production company with a $ 107.0 billion market capitalization. Netflix, Inc. (NASDAQ:NFLX) delivered a -60.04% return since the beginning of the year, while its 12-month returns are down by -62.08%. The stock closed at $240.74 per share on October 04, 2022.

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

Netflix was the top performance detractor for the year. After a brutal growth acceleration throughout 2020, followed by an expected moderation throughout 2021, 2022 was an important year to define whether the company would be able to maintain an extremely consistent historical growth trend until then.

Among the 37 million subscribers added in 2020 – boosted by the lockdown – and the 18 million added in 2021, the company added an average of 27 million subscribers in the last two years, a number practically equal to the 29 and 28 million subscribers that Netflix added, respectively, in 2018 and 2019.

Considering, also, that the 8.3 million subscribers added in the last quarter of 2021 were equivalent to the equivalent quarters of the previous three years 2 ] , it seemed reasonable to us to assume that the anticipation of demand caused by the pandemic in 2020 had reversed throughout 2021, bringing together the conditions for a more normalized growth in 2022. That is not what happened…” (Click here to see the full text)

Photo by Alexander Shatov on Unsplash

Our calculations show that Netflix, Inc. (NASDAQ:NFLX) ranks 19th on our list of the 30 Most Popular Stocks Among Hedge Funds. Netflix, Inc. (NASDAQ:NFLX) was in 95 hedge fund portfolios at the end of the second quarter of 2022, compared to 109 funds in the previous quarter. Netflix, Inc. (NASDAQ:NFLX) delivered a 29.51% return in the past 3 months.

In October 2022, we also shared another hedge fund’s views on Netflix, Inc. (NASDAQ:NFLX) in another article. You can find other investor letters from hedge funds and prominent investors on our hedge fund investor letters 2022 Q2 page.

Disclosure: None. This article is originally published at Insider Monkey.

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