Netflix (NFLX) Expands Its Production Hub in New Mexico
Netflix NFLX has gained 40.6% year to date against the Zacks Consumer Discretionary sector’s decline of 1%.
This outperformance can be attributed to the company’s commitment to developing original content, which is expected to aid long-term growth.
This Zacks Rank #3 (Hold) company is expanding its commitment with the expansion of its West Coast production facility in Albuquerque, NM, six years after initially establishing its production hub there in 2018. The new expansion includes four new soundstages, three mills, one production office, two stage support buildings and two dedicated backlot areas across 108 acres. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The studio has facilitated the production of numerous series and films, including popular titles like Stranger Things, The Harder They Fall, Army of the Dead and El Camino: A Breaking Bad Movie. NFLX's investments in New Mexico have totaled nearly $575 million directly, with an overall investment of approximately $900 million when considering other productions at Netflix Studios Albuquerque.
The company has also created substantial employment opportunities, hiring more than 4,000 cast and crew members in the region from 2021 to 2023, demonstrating its ongoing commitment to the local community and economy.
Netflix, Inc. Price and Consensus
Netflix, Inc. price-consensus-chart | Netflix, Inc. Quote
NFLX’s Upcoming Content to Aid Top-Line Growth
Netflix is building on its latest expansion of production hub with exciting new content across various genres to aid top-line growth in the upcoming quarters.
The Zacks Consensus Estimate for NFLX's 2024 revenues is pegged at $38.75 billion, indicating 14.91% year-over-year growth.
Upcoming series on Netflix include America's Sweethearts: Dallas Cowboys Cheerleaders and That ‘90s Show, which are returning with part two and set in the summer of 1996. The Mole Season 2 is set to feature a high-stakes competition where contestants must identify the saboteur among them to win a cash prize.
In the film category, Netflix introduces the highly anticipated Beverly Hills Cop - Axel F, with Eddie Murphy reprising his iconic role as Detective Axel Foley. For documentary enthusiasts, Skywalkers: A Love Story and Mountain Queen: The Summits Of Lhakpa Sherpa offer gripping true stories of daring feats and personal triumphs.
NFLX is also expanding its gaming and animated series offerings. Exploding Kittens promises humor with a plot involving God and the Antichrist trapped in cat bodies. Terminator Zero, set to premiere on Aug 29, reimagines the classic Terminator saga in an animated format. With a mix of returning favorites and new series and films, Netflix's summer lineup aims to cater to diverse tastes and keep audiences entertained.
NFLX faces tough competition in the streaming space from Amazon AMZN, Disney DIS and Paramount Global PARA.
Netflix, Amazon and Disney are top contenders in the global streaming industry. According to a report by CULT MTL, Netflix leads with a 24% market share, followed by AMZN’s Prime Video with 23%, DIS’ Disney+ with 18% and PARA’s Paramount+ with 8%.
Conclusion
Netflix’s expanding original content is a major positive, which bodes well for the long-term growth of the company. However, rising competition in the streaming industry remains a concern for NFLX.
The company’s diversifying content portfolio in India, Mexico, Spain, Italy, Germany, Brazil, France, Turkey and the Middle East, with its emphasis on streaming regional content, drives global growth.
The Zacks Consensus Estimate for NFLX’s second-quarter 2024 earnings per share is pegged at $4.7, which has increased 6 cents in the past 60 days. The consensus mark for 2024 earnings is pegged at $18.31 per share, which has increased 18 cents in the past 60 days.
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