13 Stocks Jim Cramer Put Under the Spotlight Recently

7. Netflix, Inc. (NASDAQ:NFLX)

Number of Hedge Fund Holders: 133

Netflix, Inc. (NASDAQ:NFLX) is one of the stocks Jim Cramer put under the spotlight recently. Discussing the post-earnings sell-off in the stock, Cramer commented:

“I think this sell-off is an overreaction… However, I will say that it’s become harder to judge Netflix ever since the company stopped… the regular reporting of subscriber metrics and average revenue per user… Again, though, I think this often, Netflix is giving you a terrific buying opportunity because I’m not worried about their business at all. I trust management when they say the Brazilian tax issue won’t impact earnings going forward, and other than that tax charge, well, you know what? I saw a lot to like…

Now, apart from the numbers themselves, I think the whole Netflix narrative remains extremely compelling… Long story short, while Netflix certainly didn’t report a clean quarter, the biggest piece of hair on this thing was that major Brazilian tax charge, one-off. I think it’s crazy that the stock sold off 10% today, given that it was already down about a hundred bucks from its highs. Plus, after the sell-off, Netflix now trades at less than 35 times next year’s earnings estimates even though it’s expected to deliver 26% earnings growth. This thing could sell at 50 times earnings, it wouldn’t be all that expensive. I think it’s a fine price to pay.

Bottom line: As far as I’m concerned, Netflix has great revenue growth and aside from that Brazilian thing, its profitability keeps improving. They had a terrific content slate. Basically, nothing about this quarter makes me doubt the company. The only thing that’s changed is the stock’s gotten a heck of a lot cheaper, which is why I think this is an incredible buying opportunity.”

Netflix, Inc. (NASDAQ:NFLX) provides streaming entertainment, including TV series, films, documentaries, and games across multiple genres and languages.