TIP711: Netflix, Ferrari, & Managing Market Volatility w/ Arif Karim

We Study Billionaires - The Investor’s Podcast Network

Stig Brodersen

Education, Investing, Business

4.6 • 3.6K Ratings

🗓️ 4 April 2025

⏱️ 83 minutes

🔗️ Recording | iTunes | RSS

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Summary

On today’s episode, Clay is joined by Arif Karim to discuss Netflix and Ferrari. Arif has studied both businesses for many years as a co-Portfolio Manager at Ensemble Capital and knows these companies as well as about anybody. Arif has been in the investment industry for over 25 years, and is currently working on transitioning to his new venture in the industry. IN THIS EPISODE YOU’LL LEARN: 00:00 - Intro 01:31 - What is Netflix’s moat, and what makes it a great business? 10:45 - How Arif managed the share price volatility of Netflix in recent years. 21:34 - The growth initiatives Netflix pursued in light of the slowdown in subscriber growth. 42:02 - Why Ferrari is a business with win-win relationships similar to Costco. 01:09:04 - How Arif thinks about Ferrari’s and Netflix’s valuation. And so much more! Disclaimer: Slight discrepancies in the timestamps may occur due to podcast platform differences. BOOKS AND RESOURCES Join Clay and a select group of passionate value investors for a retreat in Big Sky, Montana. Learn more here. Join the exclusive TIP Mastermind Community to engage in meaningful stock investing discussions with Stig, Clay, Kyle, and the other community members. Connect with Arif on LinkedIn. Follow Clay on LinkedIn & X. Check out all the books mentioned and discussed in our podcast episodes here. Enjoy ad-free episodes when you subscribe to our Premium Feed. NEW TO THE SHOW? Get smarter about valuing businesses in just a few minutes each week through our newsletter, The Intrinsic Value Newsletter. Check out our We Study Billionaires Starter Packs. Follow our official social media accounts: X (Twitter) | LinkedIn | Instagram | Facebook | TikTok. Browse through all our episodes (complete with transcripts) here. Try our tool for picking stock winners and managing our portfolios: TIP Finance Tool. Enjoy exclusive perks from our favorite Apps and Services. Learn how to better start, manage, and grow your business with the best business podcasts. SPONSORS Support our free podcast by supporting our sponsors: Hardblock Found DeleteMe Fundrise CFI Education Vanta Shopify Onramp TurboTax HELP US OUT! Help us reach new listeners by leaving us a rating and review on Spotify! It takes less than 30 seconds, and really helps our show grow, which allows us to bring on even better guests for you all! Thank you – we really appreciate it! Support our show by becoming a premium member! https://theinvestorspodcastnetwork.supportingcast.fm Learn more about your ad choices. Visit megaphone.fm/adchoices Support our show by becoming a premium member! https://theinvestorspodcastnetwork.supportingcast.fm

Transcript

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0:00.0	You're listening to TIP. On today's episode, we welcome back RF Kareem. RF has been featured
0:07.1	on the show several times and has over 25 years of experience in the investment industry.
0:12.2	On today's show, we discussed two companies that he knows as well as anybody, Netflix and Ferrari.
0:18.0	Both stocks are incredibly interesting businesses as well as strong outperformers in the
0:22.5	stock market. In this episode, we cover Netflix's moat and why RF believes it's a great business,
0:28.4	how RF managed the share price volatility of Netflix in recent years, the growth initiatives that
0:33.6	Netflix pursued in light of the slowdown in subscriber growth in 2022, why Ferrari is a
0:39.0	great business with win-win relationships similar to Costco, how Ferrari will fare as they
0:43.8	transition to selling more electric vehicles, how RF thinks about Ferraris and Netflix's valuation,
0:49.6	and much more. With that, I hope you enjoyed today's discussion with R.F. Karim.
0:58.0	Since 2014 and through more than 180 million downloads, we've studied the financial
1:03.3	markets and read the books that influence self-made billionaires the most.
1:07.7	We keep you informed and prepared for the unexpected. Now for your host, Play Fink.
1:12.9	Welcome to the Investors Podcast. I'm your host, Clay Fink, and today I'm thrilled to welcome
1:25.8	back, RF Kareem. ArF, thanks for taking the time today.
1:29.2	Hey, thanks, Clay. Great to be back on your show and speaking with you again. Thanks for having me.
1:34.4	Yeah, well, in preparation for this discussion, I was looking back at your previous appearances on the show,
1:39.2	and I've really appreciated just the depth of the insights you provide. And I thought it would be a great time to revisit some of the names we've discussed. So we've previously chatted about Netflix and Ferrari. So I wanted to touch on those again. So let's start here with Netflix. So this is a company you've been following for many years. And along the way, the stock has just been a massive outperformer. This company's just been a bit of a mystery to me just due to, one, the level of competition they have. And two, them needing to continuously spend more and more on content. So it's estimated that on their $39 billion revenue base, they're spending over $17 billion on content alone.
2:19.0	So how about you outline what it is that makes Netflix such a great business in your
2:23.0	view?
2:24.4	Yeah, sure, Clay.
2:25.4	Netflix is an interesting one.
	...

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