Ensemble Capital Management, an investment management company, released its fourth quarter 2023 investor letter. A copy of the same can be downloaded here. The fund saw exceptionally excellent absolute and relative performance in the fourth quarter. The fund was up 16.00% in the quarter while the S&P 500 appreciated 11.69%. The fund was up 21.75% for the full year vs the S&P 500 up 26.29%. The fund’s underperformance was due to its investment in First Republic, which the fund exited in March. In addition, please check the fund’s top five holdings to know its best picks in 2023.
Ensemble Capital Management featured stocks such as Netflix, Inc. (NASDAQ:NFLX) in the fourth quarter 2023 investor letter. Headquartered in Los Gatos, California, Netflix, Inc. (NASDAQ:NFLX) is a streaming platform. On January 17, 2024, Netflix, Inc. (NASDAQ:NFLX) stock closed at $480.33 per share. One-month return of Netflix, Inc. (NASDAQ:NFLX) was -2.29%, and its shares gained 52.11% of their value over the last 52 weeks. Netflix, Inc. (NASDAQ:NFLX) has a market capitalization of $210.231 billion.
Ensemble Capital Management stated the following regarding Netflix, Inc. (NASDAQ:NFLX) in its fourth quarter 2023 investor letter:
“Netflix, Inc. (NASDAQ:NFLX) (7.19% weight in the Fund): During the quarter, Netflix reported another quarter of strong subscriber growth and guided for full year subscriber growth of over 25 million new members. This result would be just short of the average growth in new subscribers reported during the company’s boom period of 2018-2021 despite many investors worrying in 2022 that Netflix’s growth may be done for good. In addition, legacy media providers continue to dial back their streaming ambitions, with some of Netflix’s would-be competitors starting to license their shows to be shown on Netflix. The stock gained 28.9% in the quarter.
We last discussed Netflix three years ago. At that time, five months into the COVID pandemic shutdowns in 2020, Netflix had added 26 million new subscribers to its service and went on to add 10 million more for a total of 36 million, ending the year with 204 million subscribers. Then in 2021, the company added 18 million subscribers culminating with 8 million new subscribers added in 4Q 2021, aided by the global success of the Korean produced show Squid Game.
The share price hit a record high of $687 in November 2021 before commencing a steep decline in December and January, presaging a significant reversal in its fortunes. Subscriber losses of 200,000 and 1 million in Q1 and Q2 of 2022, the first such net subscriber loss in Netflix’s history, caused shares to fall 75% from the November 2021 peak to its bottom six months later. As it turned out, through all of 2022, Netflix grew subscribers by 9 million or 4%, a big drop compared to the 20% average growth over the previous five years, but less than the worst fears…” (Click here to read the full text)
A home theater with family members enjoying streaming content together.
Netflix, Inc. (NASDAQ:NFLX) is in 23rd position on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 102 hedge fund portfolios held Netflix, Inc. (NASDAQ:NFLX) at the end of third quarter which was 114 in the previous quarter.
We discussed Netflix, Inc. (NASDAQ:NFLX) in another article and shared Artisan Partners’ views on the company. In addition, please check out our hedge fund investor letters Q4 2023 page for more investor letters from hedge funds and other leading investors.
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Disclosure: None. This article is originally published at Insider Monkey.
