Nomura Global Growth Fund on Netflix Inc.
Thesis
The fund held Netflix during a quarter in which the stock lagged. The investment team states that there was no change in the company's fundamentals. The weakness was instead attributed to the market's preference for AI-related stocks and sectors, framing the underperformance as relative rotation rather than a deterioration in the business.
“had no change in its fundamentals; however, the stock continued to lag given the outperformance in AI-related stocks and sectors.”
Key risks
- Continued market leadership by AI-related stocks and sectors could prolong relative underperformance