Client specification:
This report is written by the analysts of ABC limited and the report is based on equity valuation of Netflix, a company that is operating under internet television industry. This report is issued to explore the internet television industry and especially for the investors that are interested in Netflix. The analysis provides in-depth information to the inventors for equity valuation of Netflix.
The report is divided into five main sections and that area:
- An introduction of the company and overview
- The industry analysis of internet television and future prospect for growth in the industry.
- SWOT analysis of the company in which internal and external factors are considered for business analysis.
- The second last session is the valuation section in which equity of Netflix is valued through many useful methods.
- In the last section, the analysis of projects undertaken by Netflix and the impacts on shareholders’ wealth.
This report is created under fair and unbiased view by ABC analysts. The method is best of available information, but it does not pursue the investors to base their decision of investment in this report as he can go for further research himself. The report does not guarantee any returns to the investors. The report may not be used for future documentation without consent of ABC analysts.
Introduction of the company:
Netflix is a US based company operating under internet television industry in which it has got a huge success and now it is one of the leading internet television providers. The company has been incorporated in 1997 and now it has more than 62 million members in 50 countries of the world. The internet television of Netflix is being enjoyed more than 100 hours a day for the TV shows and movies along with original series, documentaries and feature films with the best picture quality (Netflix Inc, 2015).
In internet, television network members can watch TV shows and movies at anytime, anywhere they can find internet screen (Netflix Inc, 2015). The television service is more common nowadays because of its availability to the member. This service is better than that traditional cable network in which the access is only available at the home and office where it has a connection on Television.
Internet television network has given an option to the members that they can pause, play and resume watching with any commercial commitments (Netflix Inc, 2015). Through this option, they can only watch the relevant piece of the show that is required by the member and they can avoid any of the advertisements that always people have disliked during serials and movies.
It offers an online flat rate DVD and blue-ray disc rentals through internet video streaming in many of the countries in the world (Anon., n.d.). The company is offering wide range of products on their online services and therefore, the company is enjoying a great customer awareness of the product offers of the company.
The number of members of the company has grown dramatically from 22.9 million in the third quarter of 2011 to 62.3 million in the first quarter of 2015 (Anon., 2015).
(Anon., 2015)
The company has three reportable segments: the domestic streaming, international streaming and domestic DVD. The revenue from local and international streaming comes from the subscription fees from members in respect to the streaming facilities. The domestic DVD revenue comes from the membership fees of DVD-by-mail to the local US base customers (Netflix Inc, 2015).
Netflix Incorporation Case Solution
Industry:
Internet television provide professionally produced, filmed entertainment offer the internet whereby any use can have an access to the contents through the availability of internet at the place he is willing to access the contents. The industry has been growing rapidly for years and it is expected to grow more in the near future due to its wide range of availability on contents (Anon., 2015).
The industry is largely growing with a number of users in the millions. The reason behind such increase is due to the world of e-commerce, it is easy for everyone to have an internet access and people are busy. Therefore, they are willing to utilize their free time in watching movies and other entertainment at any place.
The industry has made computers, laptops, TV, Tablets and mobile phones the devices to use the internet television and it offers the same quality of video streaming of these devices. In this era of smartphones, it has made it easy to access the videos through the internet television on the phone at any time anywhere with internet connection access.......................
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