The S&P 500 Becomes an AI-Focused Index: Stocks to Diversify Your Portfolio Against Potential Setbacks
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Oct 20 2025
0mins
Should l Buy NFLX?
Source: CNBC
Investor Caution on AI Stocks: With high valuations in AI stocks, investors are advised to diversify their portfolios, as the S&P 500 is heavily influenced by tech and AI-related companies. Trivariate Research's Adam Parker suggests that the current market conditions resemble a "rational bubble," with potential risks for investors.
Stock Performance and Recommendations: Parker recommends looking for stocks with low correlation to AI semiconductors that have shown at least a 10% increase over the last six months, are of high quality, and have lower volatility. Notable companies like Walmart and Netflix are highlighted for their performance and strategic use of AI, while Welltower is expected to benefit from the aging population in the senior housing sector.
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Analyst Views on NFLX
Wall Street analysts forecast NFLX stock price to rise
38 Analyst Rating
27 Buy
10 Hold
1 Sell
Moderate Buy
Current: 95.550
Low
92.00
Averages
114.18
High
150.00
Current: 95.550
Low
92.00
Averages
114.18
High
150.00
About NFLX
Netflix, Inc. is a provider of entertainment services. The Company acquires, licenses and produces content, including original programming. It provides paid memberships in over 190 countries offering television (TV) series, films and games across a variety of genres and languages. It allows members to play, pause and resume watching as much as they want, anytime, anywhere, and can change their plans at any time. The Company offers members the ability to receive streaming content through a host of Internet-connected devices, including TVs, digital video players, TV set-top boxes and mobile devices. It is engaged in scaling its streaming service, such as introducing games and advertising on its service, as well as offering live programming. It is developing technology and utilizing third-party cloud computing, technology and other services. The Company is also engaged in scaling its own studio operations to produce original content.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Netflix and EverPass to Stream Fury-Makhmudov Fight in 2026
- Fight Streaming Agreement: Netflix has partnered with EverPass Media to stream the Tyson Fury vs. Arslanbek Makhmudov fight on April 11, 2026, at Tottenham Hotspur Stadium in London, marking a significant expansion of Netflix's presence in sports broadcasting.
- Global Accessibility: The event will be available for streaming globally on Netflix, while U.S. commercial establishments can access it via the EverPass platform, aiming to attract a broader audience and enhance user engagement.
- Traffic and Engagement Boost: EverPass Media CEO Alex Kaplan stated that the fight will provide reliable access for streaming customers, which is expected to significantly drive traffic and user engagement, thereby enhancing the platform's competitive edge.
- Strategic Implications: This collaboration not only highlights Netflix's ambitions in the sports content arena but also potentially paves the way for more live sports events in the future, further solidifying its leadership position in the streaming market.
See More
Netflix's Strategic Approach to Sports Broadcasting
- Sports Rights Investment: In 2024, Netflix secured exclusive broadcasting rights for Christmas Day NFL games at $75 million per game, which, while substantial, represents a significant cost reduction compared to traditional networks' annual spending of $2.1 billion to $2.7 billion, showcasing its flexible strategy in sports broadcasting.
- Ad-Supported Membership Growth: As ad-supported memberships become a new growth engine for Netflix, the company can adjust its spending on sports content based on market demand, committing $5 billion over ten years for WWE's Monday Night RAW, thereby enhancing its competitive position in the market.
- Increased Return on Capital: Netflix's return on invested capital has soared to over 25% in recent years, reflecting high efficiency in content investment, and with analysts projecting a robust 22% annual growth ahead, Netflix stock is viewed as a strong buy at its current valuation.
- Market Share Expansion: As Netflix continues to grow its subscriber base and expand into sports, its strategic investments not only enhance brand influence but also position the company to solidify its leadership in the global media market in the coming years.
See More
Netflix's Sports Strategy Fuels Growth
- Market Share Growth: Streaming services continue to capture market share from traditional cable television, with Netflix emerging as one of the world's largest media companies, as evidenced by 96 of the top 100 most-watched shows in 2025 being sports events, highlighting the significance of sports in viewership.
- Unique Sports Rights Strategy: Netflix's deal with the NFL, reportedly paying $75 million per game for exclusive broadcasting rights, is a strategic departure from traditional networks that spend $2.1 billion to $2.7 billion annually, showcasing Netflix's flexible spending approach in sports content.
- Ad-Supported Membership Growth: Netflix's ad-supported memberships have become a growth engine, allowing the company to scale its spending as needed, such as committing $5 billion over ten years to broadcast WWE's RAW programming, demonstrating adaptability in monetization strategies.
- Improved Return on Capital: Netflix's return on invested capital has soared to over 25% in recent years, with Wall Street analysts projecting a long-term annualized growth rate of 22%, making Netflix stock a compelling buy at its current valuation of 31 times its 2026 earnings estimates.
See More
Netflix Raises Prices Again, Revealing Growth Potential
- Membership Growth and Pricing: Netflix anticipates revenue growth driven by membership increases and price hikes in 2026, recently raising U.S. prices by $1 to $2 per month, indicating strong pricing power and the potential for continued double-digit sales growth.
- Subscriber Metrics: By the end of 2024, Netflix boasts nearly 90 million subscribers in the U.S. and Canada, significantly outpacing competitors Disney and Warner Bros., which have around 60 million subscribers, underscoring its dominance in the streaming market.
- Viewing Hours: The average U.S. subscriber spends over one hour daily on Netflix, compared to Hulu's 36 minutes, highlighting Netflix's superior engagement and customer satisfaction, which bolsters management's confidence in raising prices.
- Advertising Revenue Growth: Despite competitive pricing, Netflix's ad-supported tier remains lower than rivals, with management expecting to double ad revenue this year, suggesting a long runway for growth and the ability to raise prices more frequently to achieve necessary double-digit growth.
See More
Netflix Raises Prices Again, Sustains Growth Momentum
- Price Adjustment: Netflix has raised its monthly fees for U.S. subscribers by $1 to $2, demonstrating its strong pricing power, which is expected to drive revenue growth necessary to maintain its valuation.
- User Growth: By the end of 2024, Netflix had nearly 90 million subscribers in the U.S. and Canada, significantly surpassing competitors Disney+ and Hulu, which reported 60 million subscribers, highlighting its market leadership.
- Viewing Time Advantage: The average U.S. subscriber spends over one hour per day on Netflix, compared to Hulu's 36 minutes, indicating a significant edge in user engagement and satisfaction, which supports its pricing strategy.
- Advertising Revenue Potential: Management expects to double its ad revenue this year, and with high user engagement, Netflix is positioned to raise prices more frequently in the future, achieving the double-digit growth needed to justify its 30x earnings multiple.
See More
Netflix Q1 2026 Earnings Preview Highlights Key Metrics
- Strong Revenue Expectations: Netflix anticipates Q1 2026 revenue of $12.157 billion, reflecting a 15.3% year-over-year growth, showcasing the company's ongoing potential in content and advertising, particularly as ad revenue doubled to $1.5 billion in 2025, with a target of approximately $3 billion in 2026, enhancing market confidence.
- Margin Improvement: The expected operating income for Q1 is $3.906 billion, with an operating margin of 32.1%, up 40 basis points year-over-year; despite increased content amortization pressures, management's confidence in margin expansion indicates effective strategies in cost control and revenue growth.
- Breakup Fee Provides Financial Flexibility: The $2.8 billion breakup fee from abandoning the Warner Bros. Discovery deal will support Netflix's remaining $8 billion buyback authorization, with investors eager for clarity on the buyback plan to enhance shareholder returns.
- Challenges in Organic Growth: Without the backdrop of the Warner Bros. deal, Netflix must independently validate its organic growth story, with management emphasizing that long-term targets do not rely on M&A; if Q1 revenue and margins meet or exceed expectations, it will further validate the sustainability of its business.
See More
Netflix and EverPass to Stream Fury-Makhmudov Fight in 2026
- Fight Streaming Agreement: Netflix has partnered with EverPass Media to stream the Tyson Fury vs. Arslanbek Makhmudov fight on April 11, 2026, at Tottenham Hotspur Stadium in London, marking a significant expansion of Netflix's presence in sports broadcasting.
- Global Accessibility: The event will be available for streaming globally on Netflix, while U.S. commercial establishments can access it via the EverPass platform, aiming to attract a broader audience and enhance user engagement.
- Traffic and Engagement Boost: EverPass Media CEO Alex Kaplan stated that the fight will provide reliable access for streaming customers, which is expected to significantly drive traffic and user engagement, thereby enhancing the platform's competitive edge.
- Strategic Implications: This collaboration not only highlights Netflix's ambitions in the sports content arena but also potentially paves the way for more live sports events in the future, further solidifying its leadership position in the streaming market.
See More
Netflix's Strategic Approach to Sports Broadcasting
- Sports Rights Investment: In 2024, Netflix secured exclusive broadcasting rights for Christmas Day NFL games at $75 million per game, which, while substantial, represents a significant cost reduction compared to traditional networks' annual spending of $2.1 billion to $2.7 billion, showcasing its flexible strategy in sports broadcasting.
- Ad-Supported Membership Growth: As ad-supported memberships become a new growth engine for Netflix, the company can adjust its spending on sports content based on market demand, committing $5 billion over ten years for WWE's Monday Night RAW, thereby enhancing its competitive position in the market.
- Increased Return on Capital: Netflix's return on invested capital has soared to over 25% in recent years, reflecting high efficiency in content investment, and with analysts projecting a robust 22% annual growth ahead, Netflix stock is viewed as a strong buy at its current valuation.
- Market Share Expansion: As Netflix continues to grow its subscriber base and expand into sports, its strategic investments not only enhance brand influence but also position the company to solidify its leadership in the global media market in the coming years.
See More
Netflix's Sports Strategy Fuels Growth
- Market Share Growth: Streaming services continue to capture market share from traditional cable television, with Netflix emerging as one of the world's largest media companies, as evidenced by 96 of the top 100 most-watched shows in 2025 being sports events, highlighting the significance of sports in viewership.
- Unique Sports Rights Strategy: Netflix's deal with the NFL, reportedly paying $75 million per game for exclusive broadcasting rights, is a strategic departure from traditional networks that spend $2.1 billion to $2.7 billion annually, showcasing Netflix's flexible spending approach in sports content.
- Ad-Supported Membership Growth: Netflix's ad-supported memberships have become a growth engine, allowing the company to scale its spending as needed, such as committing $5 billion over ten years to broadcast WWE's RAW programming, demonstrating adaptability in monetization strategies.
- Improved Return on Capital: Netflix's return on invested capital has soared to over 25% in recent years, with Wall Street analysts projecting a long-term annualized growth rate of 22%, making Netflix stock a compelling buy at its current valuation of 31 times its 2026 earnings estimates.
See More
Netflix Raises Prices Again, Revealing Growth Potential
- Membership Growth and Pricing: Netflix anticipates revenue growth driven by membership increases and price hikes in 2026, recently raising U.S. prices by $1 to $2 per month, indicating strong pricing power and the potential for continued double-digit sales growth.
- Subscriber Metrics: By the end of 2024, Netflix boasts nearly 90 million subscribers in the U.S. and Canada, significantly outpacing competitors Disney and Warner Bros., which have around 60 million subscribers, underscoring its dominance in the streaming market.
- Viewing Hours: The average U.S. subscriber spends over one hour daily on Netflix, compared to Hulu's 36 minutes, highlighting Netflix's superior engagement and customer satisfaction, which bolsters management's confidence in raising prices.
- Advertising Revenue Growth: Despite competitive pricing, Netflix's ad-supported tier remains lower than rivals, with management expecting to double ad revenue this year, suggesting a long runway for growth and the ability to raise prices more frequently to achieve necessary double-digit growth.
See More
Netflix Raises Prices Again, Sustains Growth Momentum
- Price Adjustment: Netflix has raised its monthly fees for U.S. subscribers by $1 to $2, demonstrating its strong pricing power, which is expected to drive revenue growth necessary to maintain its valuation.
- User Growth: By the end of 2024, Netflix had nearly 90 million subscribers in the U.S. and Canada, significantly surpassing competitors Disney+ and Hulu, which reported 60 million subscribers, highlighting its market leadership.
- Viewing Time Advantage: The average U.S. subscriber spends over one hour per day on Netflix, compared to Hulu's 36 minutes, indicating a significant edge in user engagement and satisfaction, which supports its pricing strategy.
- Advertising Revenue Potential: Management expects to double its ad revenue this year, and with high user engagement, Netflix is positioned to raise prices more frequently in the future, achieving the double-digit growth needed to justify its 30x earnings multiple.
See More
Netflix Q1 2026 Earnings Preview Highlights Key Metrics
- Strong Revenue Expectations: Netflix anticipates Q1 2026 revenue of $12.157 billion, reflecting a 15.3% year-over-year growth, showcasing the company's ongoing potential in content and advertising, particularly as ad revenue doubled to $1.5 billion in 2025, with a target of approximately $3 billion in 2026, enhancing market confidence.
- Margin Improvement: The expected operating income for Q1 is $3.906 billion, with an operating margin of 32.1%, up 40 basis points year-over-year; despite increased content amortization pressures, management's confidence in margin expansion indicates effective strategies in cost control and revenue growth.
- Breakup Fee Provides Financial Flexibility: The $2.8 billion breakup fee from abandoning the Warner Bros. Discovery deal will support Netflix's remaining $8 billion buyback authorization, with investors eager for clarity on the buyback plan to enhance shareholder returns.
- Challenges in Organic Growth: Without the backdrop of the Warner Bros. deal, Netflix must independently validate its organic growth story, with management emphasizing that long-term targets do not rely on M&A; if Q1 revenue and margins meet or exceed expectations, it will further validate the sustainability of its business.
See More
