Netflix stock is cruising at record highs this week. Here's why Wall Street is cheering on the streaming giant.

• Netflix's stock hit a record high this week for the first time since the pandemic.
• The stock is rising as shares of competing streamers struggle.
• Netflix is winning over investors with ad strength and steady subscriber growth.

The streaming war is a crowded conflict, but investors think they see a winner in Netflix this week.

Shares of the streaming giant closed at an all-time high of $698.54 on Tuesday. The stock extended gains slightly in Wednesday's session to about $698.82 as of 2:53 p.m. ET.

The stock is up 44% year-to-date in a huge reversal after crashing by more than 75% from its pandemic peak in 2022.

Meanwhile, investors are turning away from other media companies that operate streaming services as they struggle to make a profit with their offerings. Year-to-date, shares of Paramount and Warner Bros. have fallen 25% and 33%, respectively, while Disney's stock has remained level.

So why are investors pushing Netflix to fresh highs this week?

Kickstarting the gains on Tuesday was an announcement in a blog post from Netflix stating that it continues to see growth in ad sales. The company has seen a 150% rise in upfront ad sale commitments compared to 2023, the blog said.

The streaming giant said those deals are a result of the highly-anticipated new seasons of shows like Bridgerton, Squid Game, and Emily in Paris, plus its Christmas Day NFL games.

Netflix announced a three-year deal with the NFL back in May, which will let it show two NFL games on Christmas this year and one or more games on the holiday in 2025 and 2026.

In addition to strong demand from advertisers, Netflix's expansion into live sports could give the platform a value add to justify raising subscription prices, analysts say.

"We view the venture into NFL games (at just ~2% of annual content spend) as a significant Q4 subscriber driver, creating a further tailwind to NFLX's password sharing initiative and supporting a price hike," Jefferies analyst James Heaney said in a client note.

And earlier this month, Disney announced plans to raise prices for its Disney+, Hulu and ESPN+ subscription tiers this fall, which could make Netflix more likely to follow suit.

Both developments could help customers justify a higher price for Netflix, Heaney said.

The stock has been steadily rising before this week, though, too. Shares are up nearly 10% in the last month following the company's strong second-quarter earnings report on July 18.

The report showed user growth surpassed expectations, with Netflix gaining over 8 million new subscribers for the quarter amid a crackdown on password sharing. Revenue grew 17% in the quarter.

Analysts said they see the company's upside as a result of moderating competition as other streaming companies focus on profits rather than growth.

"Over the past year, we have seen a normalization of the 'streaming wars' with various services/companies focusing on cost structure and with that, a return to licensing out content and focusing on existing markets," analysts from Goldman Sachs said in a note before Netflix's latest earnings.

Disclosure: Mathias Döpfner, CEO of Business Insider's parent company, Axel Springer, is a Netflix board member.