Netflix vs Disney: What's the Better Stock to Buy Right Now?

Netflix (NASDAQ: NFLX) and Walt Disney (NYSE: DIS) are two popular and successful media companies and rivals in the hotly competitive streaming industry. While Netflix has built its business entirely on streaming, Disney has much broader operations, yet its valuation is far lower than Netflix's. It's a testament to just how strong and dominant Netflix's streaming business has become over the years.

In the past five years, Netflix's stock has surged more than 60%, while Disney's stock is down over 40%. Will that trend continue, or could Disney be the better buy from here on out? Let's take a closer look at both of these companies.

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The case for Netflix

Netflix has shown that it knows how to dominate the streaming business. Not only has it generated strong growth over the years, but its profits have been strong as well. Its gross profit margin is close to 50%,which is impressive given the company's aggressive efforts to not only grow its content but also venture into gaming and live sports.

The company has also done exceedingly well despite raising prices multiple times in recent years. Consumers see tremendous value in its offerings, as evidenced by the company's continued growth. In 2025, Netflix's revenue totaled $45 billion, which represents an increase of 43% in a span of just three years.

The stock is down 13% this year, which gives investors a compelling reason to buy it on the dip. Currently, Netflix's stock trades at a reasonable price-to-earnings multiple of 26, which is in line with the S&P 500 average. With some excellent fundamentals and growth prospects, that's some solid value for a terrific blue chip stock such as Netflix.

The case for Disney

Disney has some excellent intellectual property in its portfolio that could make it an undervalued investment to hold for the long haul. While its growth may not be terribly exciting of late (Disney's revenue was up just 6% over its past two quarters), the company has incredibly valuable assets that can generate significant growth for years to come.

Under new CEO Josh D'Amaro, who has been with the company for decades and most recently served as chairman of the Disney Experiences segment, which includes its parks, the company may be in good hands to navigate the next phase of its growth. The Experiences segment generates more than half of the company's operating income, and expanding its parks is a huge growth opportunity for Disney. D'Amaro took over from Bob Iger earlier this year.

What's astonishing is that, despite being a household name, having a varied business model that goes beyond streaming, Disney's market cap of $177 billion is roughly half of Netflix's ($344 billion). While Disney might not need a massive turnaround, there is an opportunity here to unlock some significant value for D'Amaro. At just 16 times earnings, the stock looks considerably undervalued.

Why Disney's stock looks like a no-brainer buy

Both stocks listed here are solid options for long-term growth investors. But with a more diversified business and a much lower valuation, I think there's a stronger case for buying Disney stock than Netflix. Disney has a ton of iconic brands and intellectual property in its portfolio that it can leverage to make its streaming platform and parks bigger and better.

Disney also has the potential to be much more valuable in the future. If it can improve its growth rate, investors may also be willing to pay a higher premium for the stock. While there's some risk and uncertainty during transitions and with a new CEO in the mix, I'm confident that the stock can deliver strong returns for investors in the long run and outperform Netflix.

David Jagielski, CPA has positions in Walt Disney. The Motley Fool has positions in and recommends Netflix and Walt Disney. The Motley Fool has a disclosure policy.