Investors looking to trade on the unwinding of the traditional cable package need look no further than Netflix, RBC Capital Markets' Mark Mahaney said Wednesday.
Shares of the video streaming giant hit an all-time high Wednesday, and were last trading up 2.2 percent at about $123.86.
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"Our thought is that cable unbundling has been happening for quite some time, but if we're going to hit an inflection point now, which maybe we are, Netflix is the derivative," he told CNBC's "Squawk Alley."
Mahaney acknowledged that shares of Netflix are expensive, but said investors have to look at the stock on a "sum-of-the-parts basis" and be willing to invest for at least a year or two.
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He sees Netflix improving profit margins as it adds more subscribers this year than last. "Stock usually works positively in that environment."
Last month, Netflix reported it had added a record 3.28 million net subscribers, well above analysts' expectations for 2.46 million additions.
The video streaming company will face easy comparisons to U.S. subscriptions in the upcoming quarter following an earnings miss in the September 2014 period, Mahaney added. Combined with its international expansion, those comparisons should produce better revenue, he said.
The biggest obstacle the company faces is a series of simultaneous international launches, Mahaney said. Earlier this year, Netflix unexpectedly announced it would expand to about 200 countries within two years.
"I hope they get that execution right," he said. "That's a very hard trick they're trying to pull off, that many international launches at the same time."
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Content risk is largely in the rearview mirror because the bigger Netflix gets, the more leverage it has with studios, he added. The company is now on its way to becoming the single-biggest customer for many original content companies such as CBS and Walt Disney, he said.
At the same time, overall streaming revenue is offsetting total costs, he said.
"These are largely fixed costs. You pay $100 million for the third season of XYZ show," he said. "The more subs you get the more leverage you get. The truth is Netflix is getting more subs. That's more leverage."
Earlier Wednesday, Walt Disney Chairman and CEO Bob Iger told CNBC's "Squawk on the Street" he views Netflix as a friend, not a foe.
"We actually are taking advantage of Netflix's great growth, and I guess maybe you can argue that we have helped Netflix's great growth," he said.
Netflix already streams Disney's direct-to-video releases, and will have the first-run rights to Walt Disney movies beginning next year. The two companies have also partnered to produce four shows and a mini-series based on Disney's Marvel Comics characters.
DISCLOSURE: Neither the analyst nor his family owns shares of Netflix. RBC does not hold greater than a 1 percent share of the stock, nor does it provide investment banking services to Netflix.