What is Netflix debt-to-equity ratio?
31, 2023.
Total debt on the balance sheet as of December 2023 : $14.54 B. According to Netflix's latest financial reports the company's total debt is $14.54 B. A company's total debt is the sum of all current and non-current debts.
The ideal debt to equity ratio is 2:1. This means that at no given point of time should the debt be more than twice the equity because it becomes riskier to pay back and hence there is a fear of bankruptcy.
What Is Netflix's Debt? As you can see below, Netflix had US$14.5b of debt, at December 2023, which is about the same as the year before. You can click the chart for greater detail.
Generally, a lower ratio is better, as it implies that the company is in less debt and is less risky for lenders and investors. A debt-to-equity ratio of 0.5 or below is considered good.
The streaming giant borrowed over $16 billion in less than a decade as it built out its content library. The strategy prompted criticism that the company was unsustainable. Netflix has reached a financial milestone: It no longer needs to borrow money.
Netflix has issued substantial sums of debt in 2018 and 2019 in order to expand its content library and deal with the intense rivalry that exists in the streaming media sector.
Good debt-to-equity ratio for businesses
Many investors prefer a company's debt-to-equity ratio to stay below 2—that is, they believe it is important for a company's debts to be only double their equity at most. Some investors are more comfortable investing when a company's debt-to-equity ratio doesn't exceed 1 to 1.5.
Generally, a good debt-to-equity ratio is anything lower than 1.0. A ratio of 2.0 or higher is usually considered risky. If a debt-to-equity ratio is negative, it means that the company has more liabilities than assets—this company would be considered extremely risky.
Yes, a D/E ratio of 50% or 0.5 is very good. This means it is a low-debt business and the company's equity is twice as high as its debts.
What is Netflix leverage ratio?
Netflix Inc (NFLX) Leverage Ratio: 2.35 for the quarter ended December 31st, 2023. Since the quarter ended June 30th, 2009, Netflix Inc's leverage ratio has increased from 1.83 to 2.35 as of the quarter ended December 31st, 2023.
Weaknesses. Content Acquisition Costs: One of the primary weaknesses of Netflix Inc is the high cost associated with content acquisition and production. As the company strives to maintain its competitive edge through original and exclusive content, it faces increasing expenses that impact its profitability.
As of April 2024 Netflix has a market cap of $272.56 Billion. This makes Netflix the world's 36th most valuable company by market cap according to our data.
In general, many investors look for a company to have a debt ratio between 0.3 and 0.6. From a pure risk perspective, debt ratios of 0.4 or lower are considered better, while a debt ratio of 0.6 or higher makes it more difficult to borrow money.
Debt-to-equity ratio values tend to land between 0.1 (almost no debt relative to equity) and 0.9 (very high levels of debt relative to equity). Most companies aim for a ratio between these two extremes, both for reasons of economic sustainability and to attract investors or lenders.
Generally speaking, a debt-to-equity ratio of between 1 and 1.5 is considered 'good'. A higher ratio suggests that debt is being used to finance business growth. This is considered a riskier prospect. But really low ratios that are nearer to 0 aren't necessarily better.
According to the last reported balance sheet, Netflix had liabilities of US$8.34b due within 12 months, and liabilities of US$19.1b due beyond 12 months.
The good news is that Netflix is growing revenues, and EBIT margins improved by 2.8 percentage points to 21%, over the last year.
Netflix Inc (NASDAQ:NFLX) has demonstrated financial stability with $7.3 billion in net cash provided by operating activities and $6.9 billion in free cash flow for the full year 2023. The company continues to prioritize shareholder value, as evidenced by its stock repurchase program and commitment to paying down debt.
Netflix's $9.4 billion in first-quarter revenues and $5.28 profit per share were comfortably above consensus analyst estimates, with Netflix's top and bottom line marks both the best in its history.
How much does Netflix cost a month?
Netflix costs $6.99 to $22.99 per month, depending on your subscription plan. It offers three plans: Standard With Ads, Standard and Premium. A former popular choice was the Basic plan at $9.99, but Netflix eliminated this option for new or rejoining members and is phasing it out entirely. Users can cancel anytime.
So far, Netflix remains one of the only profitable major streaming services, and investors seem to feel good about the company's prospects: Netflix's stock is up 36% compared to one year ago, while Disney's stock fell 10%, and Warner Bros.
McDonald's Debt to Equity Ratio: -8.359 for Dec.
31, 2023.
Lowe's Debt to Equity Ratio: -2.387 for Jan.
