Netflix: The Future of Entertainment or House of Cards?

This article presents a detailed subscriber-based valuation of Netflix as of April 2018, breaking down the company's cost structure into servicing existing subscribers, acquiring new ones, and corporate overhead. The author values Netflix at $172.82 per share—well below its $275 market price—arguing that the key value driver is Netflix's ability to control content cost growth at 3% annually, with the valuation highly sensitive to this assumption. The analysis concludes that investing in Netflix is fundamentally a bet on content cost discipline rather than subscriber or revenue growth.