Netflix (NFLX) is a company I have been following a long time now, and even after its incredible run over the years I continue to see upside for this stock both in the short and long term.

The company has executed its streaming model with perfection, managing to protect its first-mover advantage even despite a year of increased competition and salvos from the likes of The Walt Disney Company (DIS), which will remove all of its content from the streaming service next year. In the process, NFLX has achieved an Amazon (AMZN)-like reputation that keeps investors focused on subscriber and revenue growth first and profits later.

All About Subscriber Growth

That said, 2017 was an amazing year for NFLX on all metrics – it added a record 8.33 million subscribers in the fourth quarter and brought in record-shattering net income of $559 million, up 178% year-over-year. Other highlights include:

  • Domestic streaming was the biggest surprise. The company now has 54.75 million subscribers in the United States, up 3.7% quarter-over-quarter and 10.8% from 2017.
  • International streaming also continues to surge. The tally was 63.832 million subscribers at the end of 2017, an increase of 10.8% in the quarter and 41.6% year-over-year.

With 75% penetration in U.S. homes, it would be understandable if domestic streaming started to slow. However, margins could still improve. Moreover, there are still 3.4 million homes in NFLX’s original DVD program. Maybe they’ll come over, although that would mean they’d have to ditch their picture-tube televisions.

The real play here is global domination. The company’s international segment made money and margins rose to their highest level yet at 8.7%. I expect margins will continue to grow along with the top line over the next several years.

In addition, management has a $6 billion budget for content, which proves they are serious. Even as NFLX has been expected to roll out some clunkers, it still managed to nab eight Oscar nominations and I think there’s a chance that “Mudbound” steals the show when the winners are announced – I’ve watched it and it’s an amazing movie.

I wouldn’t count out bouts of gyrations as the broad market looks for its footing, but I think this stock has the potential to rally to $320 in 2018.