Netflix, Inc. (NFLX) vs Warner Bros. Discovery, Inc. (WBD)

Netflix, Inc. and Warner Bros. Discovery, Inc. are both Entertainment companies. Netflix, Inc. is the larger, with a market value of $298.1B against $77.3B — 3.9× the size. Warner Bros. Discovery, Inc. has negative trailing earnings, so its P/E is not meaningful; Netflix, Inc. trades at 22.0×. Netflix, Inc. grew revenue faster over the last twelve months: 16.0% against −6.05%. Netflix, Inc. has the higher net margin (28.2% vs −8.77%) and the higher return on invested capital (27.3% vs −1.27%). Across the 21 metrics below, Netflix, Inc. leads on 15 and Warner Bros. Discovery, Inc. on 6.

Valuation

Metric NFLX WBD Entertainment median
P/E 22.03 n/m 22.03
P/S 6.16 2.15 1.47
P/B 9.89 2.28 2.00
Price to free cash flow 28.85 35.55 16.60
EV/EBITDA 9.39 7.64 9.65
EV/Sales 6.22 2.94 1.76
Earnings yield 4.54% (4.12%) (0.67%)
Free cash flow yield 3.47% 2.81% 3.26%

Profitability

Metric NFLX WBD Entertainment median
Gross margin 49.12% 47.25% 45.02%
Operating margin 29.68% (3.52%) 2.30%
Net margin 28.22% (8.77%) 0.00%
Free cash flow margin 23.06% 6.04% 1.56%
Return on equity 49.54% (8.88%) 0.00%
Return on assets 24.47% (3.18%) 0.00%
Return on invested capital 27.31% (1.27%) 0.00%

Growth

Metric NFLX WBD Entertainment median
Revenue growth (TTM) 16.02% (6.05%) 5.07%
EPS growth (last fiscal year) 27.58% 106.28% —
Revenue growth, 5-year CAGR 12.57% 28.44% 10.25%
Net income growth, 5-year CAGR 31.80% (9.82%) 0.00%

Health

Metric NFLX WBD Entertainment median
Debt to equity 0.39 0.94 0.46
Current ratio 1.14 0.78 0.86
Net debt to EBITDA 0.15 1.53 0.72

Dividend

Metric NFLX WBD Entertainment median
Dividend yield — — 1.16%
Payout ratio 0.00 0.00 0.00

Size

Metric NFLX WBD Entertainment median
Market cap 298.05b 77.30b 1.87b

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