Investment firm Pershing Square has become a top 20 shareholder in Netflix, investing more than US$1 billion in the company since its share price dropped in the wake of its latest earnings release.
The company, led by billionaire investor Bill Ackman, now owns more than 3.1 million shares in Netflix.
Despite the company seeing US$45 billion wiped off its value in the immediate aftermath of reporting its Q4 2021 earnings, Ackman has praised Netflix’s “best-in-class management team” and commended co-CEO Reed Hastings for the “remarkable company he and his team have built.”
In his letter to investors, Ackman noted that Netflix benefits from highly recurring revenues, and that it provides industry-leading content. He said that the company was ready to sweep in when Netflix’s price tumbled
Pershing Square’s latest investment in Netflix has been received well by the market, with Netflix’s share increasing by 5% in after-hours trading.
Ackman added on Twitter: “We are delighted that the market has presented us with this opportunity.”