Sells streaming video subscriptions worldwide, now alongside advertising-supported tiers.
Netflix (NFLX) scores 7.8 out of 10 as of , computed from its reported financial statements. That reads as high quality. The reading rests on profitability, and predictability is what holds it back.
Data provided by Twelve Data. Scores are computed by Lemma Analysis from reported financials.
Netflix’s returns on capital beat their cost in most measured years: 3 of 5 indicators passed.
Quantitative signs of a moat, read from the filed statements. This is not a judgement of where it comes from (brand, network effects, switching costs). How Lemma measures a moat →
Netflix spent a decade pairing strong growth with negative free cash flow, and the pillars that lagged then are the ones improving fastest now. Content is capitalised and amortised, so reported profit and cash generation can diverge sharply, which is precisely what a multi-metric reading exists to reconcile. Predictability, measured over a long window, still carries the memory of that earlier shape.
On the filings behind it, Netflix earns 7.8 out of 10 for business quality as of October 19, 2026. That is high quality on our scale. A high reading means most of the pillars are strong, with no serious weakness pulling the average down. The figure is a weighted average of five pillars, each scored from 0 to 10 against sector-aware benchmarks from reported statements.
Among the 80 Communication Services companies with a published score, that ranks at the 97th percentile, in the top tenth of its peers. The median across the group is 4.6, and the top quarter begins at 6.0, so Netflix is well above the typical company here.
Profitability scores 9.2 out of 10, which reads as strong. The median across 77 Communication Services companies is 3.7, so Netflix is well above its peers on this pillar and ranks at the 99th percentile. High profitability means each unit of capital and of sales is turning into more profit than at most of its peers, which is usually the first sign of pricing power or a cost advantage.
Solvency scores 8.5 out of 10, which reads as strong. The median across 62 Communication Services companies is 4.8, so Netflix is well above its peers on this pillar and ranks at the 84th percentile. Strong solvency points to a balance sheet that can carry its debts comfortably, with interest well covered and little pressure from creditors.
Growth scores 7.5 out of 10, which reads as strong. The median across 64 Communication Services companies is 4.7, so Netflix is well above its peers on this pillar and ranks at the 75th percentile. A high growth score rewards a business that is getting bigger in a way that reaches the bottom line, not just the top one.
Netflix’s efficiency score is 7.5 out of 10 (strong). Against a median of 6.1 among 76 Communication Services companies, that is above the group and the 73rd percentile. A strong efficiency reading usually shows up as healthy cash conversion: reported profit arriving as real cash rather than staying on the balance sheet.
On predictability, Netflix scores 5.6, an average reading. Its peers have a median of 4.5 across 80 Communication Services companies, which places it above them, at the 76th percentile. Consistency near the median is typical, and it is worth checking whether the swings came from the business itself or from one-off items.
This is a lopsided profile. Profitability scores 9.2 but predictability only 5.6, a gap of 3.6 points, so the overall hides a business that is excellent in one respect and weak in another. Leading with profitability is the most valuable kind of strength, because margins and returns are what the other pillars ultimately feed. A predictability shortfall means the record is volatile, so the averages behind the other pillars move more than they appear to.
Every scored pillar is at or above the median of Communication Services companies, so there is no catch-up left to lift the overall. The risk runs the other way: a one point fall in profitability, the heaviest of them, would take the score from 7.8 to about 7.5. All five pillars could be scored, so the overall uses the full set of weights out of 100: profitability 25, solvency 20, growth 20, efficiency 15, predictability 20.
These are the Communication Services companies closest to Netflix in market value. Each has its own page scored on the same five pillars, so the comparison is like for like.
How much profit the company generates from its capital and sales.
The company’s ability to service debt and meet its obligations.
How fast revenue, earnings and cash flow are compounding.
How well assets and earnings convert into cash and output.
How stable and consistent results have been over time.
Each metric is scored from 0 to 10 against sector-aware benchmarks, where higher is better. Metrics roll up into five pillars, and the pillars combine into the overall score using the weights shown. Sector-sensitive metrics are judged relative to peers in the same sector.
This score is a systematic, backward-looking read of reported fundamentals. It does not judge valuation, management quality, competitive moat, or future prospects, and can be distorted by one-off items or unusual accounting. Treat it as a starting point, not a recommendation.
Educational only. Not investment advice.
On this reading Netflix scores 7.8 out of 10, which reads as high quality. Its strongest pillar is profitability, its weakest is predictability. Quality is not the same as a good investment: the score says nothing about the price you would pay.
Netflix ranks at the 97th percentile of the 80 Communication Services companies Lemma publishes a score for. The median there is 4.6 and the top quarter starts at 6.0, against Netflix’s 7.8.
Five pillars, each scored from 0 to 10 against sector-aware benchmarks and then weighted into one overall reading: profitability, solvency, growth, efficiency and predictability. Everything comes from reported financials, and nothing comes from price, sentiment or forecasts.
This page last changed on October 19, 2026. The score moves with the financial statements, so the page changes when a new filing moves the reading rather than on a schedule. Live figures for NFLX are in the app.
No. Quality and valuation are separate questions, and a good business at the wrong price is still a bad purchase. Score the business here, then price it with a DCF you control.
Inside Lemma Analysis the same five pillars run on every company we cover, with the metrics behind each one, current fundamentals, a DCF you control and a watchlist that tells you when the price catches up.
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