Media mogul Byron Allen says Netflix is a 'great buy'
Netflix is still reeling from its unexpected decline in Q1 subscribers, which led to a stock plummet of 35% and wiped more than $50 billion off of its market cap.
The streaming giant's disappointing results came as inflation remains high, consumers cut costs and competition intensifies, although one media mogul is not giving up on Netflix quite yet.
"I don't think Netflix has crashed — quite frankly, I think the market has overreacted," Byron Allen, the founder and CEO of Entertainment Studios, told Yahoo Finance Editor-in-Chief Andy Serwer.
Allen, who currently owns 36 TV stations, 12 cable networks, six streaming platforms and several distribution companies under his broadcast business, the Allen Media Group, said, "There's a price adjustment on the valuation of [Netlix], but the company is still phenomenal with over 200 million subscribers."
Quite frankly, I think that market has overreacted to Netflix...Byron Allen, media mogul and the founder and CEO of Entertainment Studios
The executive went on to say how the company lost about 700,000 subscribers upon exiting Russia following Moscow’s invasion of Ukraine.
"I'm sorry, you have over 200 million subscribers. If you didn't pull out of Russia, you would have been positive 700,000 subscribers. There's nothing to apologize for. There's nothing to worry about. There's nothing to be concerned about," he continued.
Allen equated businesses like Netflix to an airplane flight, saying the streamer, which has ascended to great heights and has also plateaued to great lows, is currently on "cruise [control]."
"Netflix is a phenomenal brand. They're going to continue to grow. And, by the way, I think it's a great buy in this category," he asserted, saying the company will always trade "in that 15 to 20 multiple" with the possibility of more "transformative" acquisitions on the horizon.
"I think Reed [Hastings] and Ted Sarandos have done a phenomenal job," Allen said of the founder and CEO and chief content officer, respectively.
"They are excellent at what they do, and I think the markets just have a way of overreacting."
'NFL is the best managed business on planet Earth'
Besides a passion for media and television, Allen is also a strong supporter of the NFL.
In fact, he's currently in a bidding war to purchase the Denver Broncos, which is expected to be sold at a record price with a current valuation of $3.7 billion, according to Forbes (10th in the overall NFL.)
If Allen were to win the bid, that would make the Denver Broncos the first NFL team to have a Black majority owner.
"I think the NFL is the best managed business on planet Earth," the businessman stated, saying he believes commissioner Roger Goodell is "underestimated" and that he loves a number of the owners, "especially Bob Kraft."
"I believe that they are sincere when they say they want to achieve something that hasn't been achieved in [the NFL's] 100 year history, which is to achieve the first Black owner of an NFL team," he continued.
"In my humble opinion, that is long overdue."
Alexandra is a Senior Entertainment and Food Reporter at Yahoo Finance. Follow her on Twitter @alliecanal8193 or email her at alexandra.canal@yahoofinance.com
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