Could This Be Netflix’s Next Acquisition Target?

Netflix (NFLX +0.58%) walked away from its attempt to acquire key assets from Warner Bros. Discovery earlier this year when a bidding war with Paramount Skydance proved to be too costly. However, rumors have continued to swirl about what’s next for the company, including a possible acquisition of Lionsgate (which Netflix has already dismissed).

While Netflix hasn’t announced any big moves, there could be an intriguing acquisition target on the horizon for the streaming giant.

Image source: Getty Images.

NBCUniversal spinoff could open up an opportunity for Netflix

Comcast (CMCSA +0.19%) is breaking up, with NBCUniversal spinning off into its own separate stock, likely in about a year. Speculation is already running rampant about whether this could be a good opportunity for Netflix to swoop in. NBCUniversal has many popular TV shows and franchises, including “The Office,” plus theme parks, TV studios, and its Peacock streaming service.

Netflix doesn’t have to acquire all of that. It could make a bid for the components that it wants the most. When it initially announced plans to acquire assets from Warner Bros. Discovery, Netflix wasn’t looking to acquire the entire business but instead key parts of it, including the studios and HBO streaming service. It could follow a similar playbook — assuming it does end up making a pitch for assets from NBCUniversal, which is by no means a guarantee.

Today’s Change

(0.58%) $0.44

Current Price

$76.46

Key Data Points

Market Cap

$320BMarket cap calculated using publicly traded shares outstanding only. Does not include unlisted, private, or dual-class non-traded shares. Implied market cap may vary.Market cap calculated using publicly traded shares outstanding only. Does not include unlisted, private, or dual-class non-traded shares. Implied market cap may vary.

Day’s Range

$76.28 – $78.18

52wk Range

$70.86 – $129.32

Volume

918.6K

Avg Vol

41.7M

Gross Margin

49.44%

Why Netflix stock looks like a great buy today

Investing based on what-if scenarios can be risky and ultimately result in disappointment if things don’t pan out. But even if investors base their decisions on where the business is today and where it looks to be headed, Netflix looks to be a great investment. The company’s strategy has worked incredibly well over the years, even as it has branched out into live sports and made moves and investments that others may not have expected to work out for the business.

With deep pockets and a highly profitable business, the company has demonstrated strong and smart leadership over the years. Investors should have confidence in its approach, whether it makes a deal or not. When it walked away from the Warner Bros. deal, it showed the careful discipline many investors lack by not overpaying for an investment. That’s a good sign that the business won’t make rash decisions or pursue an acquisition simply to get bigger. And that’s why Netflix is a terrific long-term investment, regardless of whether it ends up trying to acquire NBCUniversal.