Before we dive in, let’s make sure you’re set to receive The Daily Breakdown each morning. To keep getting our daily insights, all you need to do is log in to your eToro account.
Interested in more Deep Dive content? Check out our latest research.
Deep Dive
Netflix is a global entertainment company that offers streaming access to TV series, films, documentaries, and mobile games across a wide range of genres and languages. Its content is available on internet-connected TVs, phones, tablets, and other devices.
The stock enjoyed a sizable rally from 2015 through 2021, climbing each year and gaining more than 1,100% in that span. It’s been a little more volatile since, falling more than 50% in 2022, before rebounding to record highs in 2024 and 2025, and then falling again in 2026.
Shares are now down more than 20% on the year — and nearly 50% from the highs. Here’s what that looks like on the charts:
Technical investors are wondering whether the prior peak in 2021 and the rising 200-week moving average near $70 will act as support for NFLX. However, fundamental investors want to know what’s going on under the surface.
Future Growth Projections
Netflix has grown its revenue for more than 10 consecutive years, while operating income and earnings have grown in 9 of the past 10 years (with only the 2022 bear market marking a dip in profits).
Earnings estimates for fiscal 2026 have climbed by more than 11% over the past three months and by almost 10% over the past six months. According to Bloomberg, analysts now project:
Earnings Growth: 34.8% in 2026, 9.4% in 2027, and 18.8% in 2028
Revenue Growth: 13.8% in 2026, 11.5% in 2027, and 10.4% in 2028
Analysts currently have a consensus price target of ~$115 on NFLX stock, implying about 60% upside to today’s stock price.
Want to receive these insights straight to your inbox?
Sign up here
Diving Deeper — Valuation
Netflix’s stock price now trades at about 21.5 times forward earnings. That marks the stock’s lowest valuation since 2022, when Netflix bottomed during the broader bear market.
Bears may argue that NFLX needs to revisit its prior valuation lows — when the forward P/E ratio was roughly 16 to 18 times — before the stock becomes more attractive. Bulls, however, may argue that valuation is already at a multi-year low while earnings growth remains solid, unlike in 2022, when earnings were under pressure and the broader market was struggling.
Risks
Netflix-specific risks include slowing subscriber growth, rising content costs, and tougher competition from Disney, Amazon, YouTube, and other streaming platforms. Its ad-tier and gaming efforts also need to scale, while price hikes could increase churn. A weaker content slate or lower hit rate could pressure engagement and margins.
Separately, investors seem to be questioning the firm’s strategy. Netflix’s stock may be under pressure less because of its core fundamentals and more because the since-abandoned Warner Bros. acquisition raised questions about its growth playbook. Investors have long viewed Netflix as a disciplined organic-growth story, while a large media acquisition could bring debt, integration risk, regulatory scrutiny, and a possible pause in buybacks. Even though Netflix walked away from the deal, the episode may have left the market wondering whether management sees a need for outside IP to sustain growth.
The Bottom Line
Netflix remains a historically strong growth story, backed by a powerful consumer brand, steady revenue growth, and solid earnings expectations for the years ahead. With the stock trading at its lowest valuation since 2022 and approaching a key technical area near prior highs and the 200-week moving average, bulls may argue the risk/reward is starting to look more compelling.
Still, the bear case has not disappeared. Skeptics may want to see an even lower valuation before stepping in, especially if they believe the Warner Bros. process raised questions about Netflix’s long-term strategy. For now, the debate is whether NFLX is nearing a longer-term support zone — or whether the stock’s sharp decline is signaling that the growth story has changed.
Disclaimer:
Please note that due to market volatility, some of the prices may have already been reached and scenarios played out.
