It's no secret that Netflix (NASDAQ:NFLX) is spending a boatload of cash on content, as the company stocks its library with award-worthy shows and builds out its international presence. The company expects to spend between $7 billion and $8 billion on programming in 2018. 

That content library still has significant value for the streaming pioneer, even after each show's initial run, though until recently, it was difficult to know how much. Thankfully, Morgan Stanley analysts have done the math, and their numbers are surprising.

Glass front building with Netflix logo above doorway.

Analyst report forecasts additional growth for Netflix. Image source: Netflix.

Not just fun with numbers

The analysts reviewed the content on Netflix's platform and valued it at $11 billion, as of this past March. They revealed that the catalogue is worth more than the $10 billion library possessed by Time Warner and its subsidiary HBO. It's also worth more than the total combined programming assets of several popular media companies, including Viacom, AMC Networks, Discovery Communications, and Scripps Network.

This wasn't an arbitrary Wall Street exercise. According to lead analyst Ben Swinburne, the other companies mentioned currently earn between $2 and $4 of revenue for every $1 invested in content. Netflix currently achieves a much lower $1 of revenue for every dollar spent on programming, but Swinburne believes that the company has yet to fully cash in on its content library. As the company expands internationally and gains more subscribers, he sees the company ramping up the revenue it produces from those investments.

"Netflix is building a much larger profit pool than the market understands," the analyst wrote, "Nevertheless, the implications would suggest a dramatic opportunity to drive earnings. As Netflix owns more of its content outright, the longer average life and increasingly global nature of its assets could drive increased content efficiencies and higher margins over time."

It shouldn't be a surprise, then, that Netflix just raised its rates, which will help boost company results even faster. 

Building a stable of talent

Netflix isn't resting on its laurels, as the company has recently added a couple of high-profile content creators to the fold.

In August, the company made the first-ever acquisition in its 20-year history and joined forces with Mark Millar and his creative house Millarworld. You'd be forgiven for not immediately recognizing the name, but Millar gave birth to such hits as The Avengers, Captain America: Civil War, and Logan. The comic book impresario was also the creative force behind hit movies Kick-Ass, Wanted, and Kingsman: The Secret Service.

Soon after, Netflix poached one of television's biggest producers, Shonda Rhimes, away from a longtime partnership with ABC Studios. Rhimes was responsible for such hits as Grey's Anatomy, Scandal, and How to Get Away With Murder.

Adding high-profile names to the talent roster will lure even more potential subscribers.

The results keep coming

Its continued emphasis on quality content appears to be working. When Netflix reported its financial results in October, the company added a record 5.3 million subscribers, up 49% year over year, beating its own estimates by 800,000 new viewers.

Netflix spends a huge amount upfront to finance its original programs, but this should be viewed as an investment in its future. I believe investors who stick around for the end of the program will find the finale extremely rewarding.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.