Should You Buy Netflix Stock After Its 51% Plunge?
Key PointsNetflix stock has plummeted by 51% from last year's record high, as investors worry the company's best days might be behind it.
Netflix, the world's largest streaming platform, has seen a 51% plunge in its stock price following its third quarter 2026 operating results. Despite generating $12.9 billion in revenue, an 11.8% increase from the year-ago period, the company's growth rate slowed to its slowest in three years. This decline raised concerns among shareholders, as Netflix had previously forecasted a doubling of revenue from ad slots to businesses in 2026.
However, the company revised this forecast down to $2.7 billion due to slower-than-expected advertising capabilities rollout. Despite these challenges, Netflix continues to invest in live sporting events, which attract new members and advertisers. The company's recent appointment of Peter Rice as chief content officer, a seasoned industry veteran with experience at major networks, has added confidence to its future content strategy.
With a P/E ratio of 18.5, trading at a bargain valuation compared to the S&P 500 and Nasdaq-100, Netflix could be an attractive long-term investment for those willing to hold for 5-to-10 years.
Written by urgent.news from Motley Fool's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
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