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2 Unstoppable Streaming Stocks to Buy Hand Over Fist in 2025, According to Wall Street
NFLXNetflix(NFLX) The Motley Fool·2025-01-08 10:23

Core Insights - Spotify and Netflix are leading players in their respective streaming markets, with Spotify's stock rising by 140% and Netflix's by 83% in 2024, both nearing record highs [1][2] Spotify - Spotify holds a global market share of 31.7% in music streaming, significantly ahead of Tencent at 14.4% [3] - The company invests in AI technologies to enhance user engagement, including a content recommendation engine and unique features like AI Playlist [4] - Spotify is a major player in podcasting and the second-largest in audiobooks, following Amazon's Audible [5] - For 2024, Spotify is projected to achieve a record revenue of 16billion,a1716 billion, a 17% increase from 2023, with expectations of reaching 18.4 billion in 2025 [6] - The company is on track for its most profitable year, reporting 795millioninnetincomethroughthefirstthreequartersof2024,aturnaroundfroma795 million in net income through the first three quarters of 2024, a turnaround from a 476 million net loss in the same period of 2023 [7] - Analyst ratings show 22 out of 38 recommend a buy, with an average price target of 495,indicatingapotential6495, indicating a potential 6% upside from current trading levels [8][9] - Spotify aims to grow its monthly active users from 640 million to 1 billion by 2030, suggesting long-term growth potential [10] Netflix - Netflix is the largest streaming platform for movies and TV shows, with 282.7 million paying subscribers, far surpassing Disney+ at 158.6 million [11] - The introduction of an advertising-supported tier at 6.99 per month has been successful, accounting for half of new signups in available markets [12] - Netflix has invested in live programming, including high-profile events that attracted significant viewership [13] - The company is expected to report a record revenue of 38.9billionfor2024,reflectinga15.438.9 billion for 2024, reflecting a 15.4% growth from 2023, driven by the advertising tier and live events [14] - Analyst ratings for Netflix show 25 out of 55 recommend a buy, with an average price target of 850.19, indicating limited upside potential [15][16] - Netflix's current P/E ratio of 49.8 is higher than the Nasdaq-100's average of 32.1 and its own three-year average of 36.8, suggesting it may be overvalued [17]