The Motley Fool·2025-12-19 09:25Group 1: Market Overview - The S&P 500 has nearly doubled since December 2020, despite a bear market in 2022 and a brief sell-off earlier this year [1] - Investor patience has been tested over the past five years, but business fundamentals are driving stock prices higher over time [2] Group 2: Netflix Performance - Netflix stock has increased 24,000% since 2005 but has underperformed the market since 2020, with an 80% rise compared to the S&P 500's 99% gain [4] - The stock saw a steep decline in 2022 due to subscriber losses but has surged 218% since then [5] - Netflix has over 300 million paying households and operates in more than 190 countries, indicating significant growth potential [7] - Analysts expect Netflix's revenue to increase by 15% in 2025, with $10 billion in net profit on $43 billion in total revenue over the last year [8] - The company is investing in content expansion and has launched an advertising-supported subscription tier to boost subscriber growth [9] - Analysts predict Netflix's earnings per share will grow at an annualized rate of approximately 24% for the foreseeable future [10] Group 3: Amazon Performance - Amazon's stock has only beaten the market in two of the past five years, underperforming the S&P 500 in 2021, 2022, and 2025 [12] - Amazon's non-retail services, including cloud computing and advertising, account for 59% of its revenue and generate the majority of its profit [13] - Amazon reported a net profit of $76 billion over the past year, with total net sales growth trending higher [15][16] - The stock is trading at a price-to-cash-flow ratio of 18, significantly lower than its previous 10-year average of 27 [17] - Analysts predict Amazon's earnings to grow at an annualized rate of 18% over the next several years [18]