Should you add Netflix (NFLX) to your portfolio?

Oakmark Funds, an investment management firm, released its 2022 Q3 “Oakmark Global Select Fund” investor letter. A copy of it can be downloaded here. In the third quarter, the fund returned -11.3% versus -6.2% for the MSCI World Index. For the fiscal year ending September 30, 2022, the fund returned -29.7% compared to a return of -19.6% for the benchmark. Additionally, you can check out the fund’s top 5 holdings for its best picks in 2022.

Oakmark Fund discussed stocks such as Netflix, Inc. (NASDAQ:NFLX) in its third quarter 2022 investor letter. Headquartered in Los Gatos, California, Netflix, Inc. (NASDAQ:NFLX) is a streaming services company entertainment. On October 11, 2022, shares of Netflix, Inc. (NASDAQ:NFLX) closed at $214.29 per share. Netflix, Inc. (NASDAQ:NFLX)’s one-month return was -4.39% and its shares lost 65.97% of their value in the last 52 weeks. Netflix, Inc. (NASDAQ:NFLX) has a market capitalization of $95.296 billion.

Here’s what the Oakmark Fund said specifically about Netflix, Inc. (NASDAQ:NFLX) in its Q3 2022 investor letter:

Netflix, Inc.. (NASDAQ:NFLX) (US), a subscription streaming service and production company, was a top contributor for the quarter. Netflix stock price reacted positively in response to second quarter results which, in our assessment, were strong and largely better than investors expected. Although the company lost approximately one million global streaming subscribers, the loss was only about half of what management projected. Revenues in constant currency, excluding foreign currency impacts, increased 13% year over year, and management projects third quarter revenues to increase 12% in constant currency. While currency exchange rates also weighed on earnings, margins are slightly ahead of previous guidance when adjusted for currency impacts. Importantly, viewer engagement, which we consider a key metric, remains strong. In the US, Netflix had as much viewing time in the 2021-22 season as the two major cable networks combined (CBS and NBC), with total TV time share hitting a record in June, according to Nielsen. Along with the earnings release, management stated that the company is making progress on its password sharing and advertising initiatives. Cash content costs for the next two to three years are expected to remain unchanged at approximately $17 billion as Netflix continues to invest in creating high-quality content. Management forecasts the net addition of one million global streaming subscribers in the third quarter, and we remain pleased with the company’s fundamental performance.”

Netflix, Inc. (NASDAQ:NFLX) ranks 19th on our list of the 30 most popular stocks among hedge funds. According to our database, 95 hedge fund portfolios held Netflix, Inc. (NASDAQ:NFLX) at the end of the second quarter, up from 109 in the previous quarter.

We discussed Netflix, Inc. (NASDAQ:NFLX) in another article and shared Polen Capital’s views on the company. Also, check out our Q3 2022 Hedge Fund Investor Letters page for more letters from hedge fund investors and other leading investors.

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Disclosure: none. This article was originally published on Insider Monkey.

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