Netflix, Inc. ( NFLX) may have scored only one Oscar win at Sunday night’s Academy Awards in Hollywood, but it was an historic win. The Netflix original documentary “Icarus” won for Best Documentary, making it Netflix’s first feature film to win an Oscar.
According to GBH Insights head of technology research Daniel Ives, Netflix’s winning documentary and eight total Oscar nominations are signs that the company’s heavy investment in original content is paying off. In addition to expanding its library of content, Netflix is also garnering critical acclaim, which is helping elevate its status as a legitimate contender with traditional Hollywood studios.
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“Netflix’s ability to attract original content, talent, artists, writers and producers to its platform is a key ingredient in its long-term recipe for success to grow its streaming service globally, and tonight’s nominations [are] a major credibility step for these efforts in our opinion,” Ives wrote on Sunday.
Among the major studios, Twenty-First Century Fox ( FOXA) was the big winner at this year’s Oscars. Between subsidiaries 20 th Century Fox and Fox Searchlight, Fox studios received 27 Oscar nominations and scored six victories, more than any other company. Fox Searchlight’s “The Shape of Water” took home four awards at the Dolby Theater on Sunday, including Best Picture.
Netflix certainly outclassed streaming competitor Amazon.com ( AMZN) at this year’s Oscars. Amazon received just one nomination and did not win an award.
However, Netflix investors are keeping a close eye on Walt Disney Co. ( DIS), as well. Disney, which plans to launch its own standalone TV and movie streaming service in 2019, landed 10 Oscar nominations and took home two awards on Sunday evening.
According to Statista, Netflix spent $6.3 billion on non-sports video content in 2017. Still, Netflix was unable to keep up with Hollywood heavy hitters Fox, Disney, Comcast Corp. ( CMCSA) and Time Warner ( TWX), each of which spend more than $7 billion. Netflix is expected to ramp up its content spending to about $8 billion in 2018.
“Our bullish thesis on Netflix is based on our belief that the company’s competitive moat, franchise appeal, ability to increase international streaming customers through 2020, and original content build out will translate into robust profitability and growth as the next phase of this story plays out over the coming year,” Ives said.
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GBH has a “highly attractive” rating and $310 price target for NFLX stock.
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Netflix Oscar Shows Heavy Investment Is Paying Off originally appeared on usnews.com
