Netflix Stock Is the Cheapest It Has Been in 3 Years Following Its 41% Plunge -- But Is It a Buy?
The Motley Fool
by newsfeedback@fool.com (Anthony Di Pizio)February 25, 2026
AI-Generated Deep Dive Summary
Netflix stock has dropped by a staggering 41% over the past year, reaching its lowest price in three years despite the company reporting record-breaking subscriber numbers, revenue, and earnings in 2025. This sharp decline comes amid intense speculation about its $82.7 billion bid for Warner Bros. Discovery, which could face significant regulatory hurdles. The acquisition, aimed at expanding Netflix's content library with high-quality shows, has left investors uncertain and cautious.
The company’s stock is now trading at a discount compared to the Nasdaq-100 index, making it an intriguing option for investors seeking undervalued opportunities. Despite this dip, Netflix remains one of the most dominant players in the streaming industry, consistently breaking records across key metrics. However, concerns over the costly and potentially problematic acquisition have cast doubt over its short-term prospects.
The long-term outlook for Netflix still appears strong, with its business model continuing to perform exceptionally well. The stock’s current valuation presents a rare chance for investors to acquire shares at a significant discount compared to historical highs. While the recent drop may seem like a setback, it could ultimately be a temporary hurdle on the path to further growth and success for the streaming giant.
For finance enthusiasts, this situation highlights the complex interplay between business performance and market sentiment. Netflix’s stock offers an interesting case study in valuation, risk, and investor psychology. As the company navigates its ambitious content acquisition strategy, the outcome will likely shape both its future growth and its stock price trajectory. For those willing to take a long-term view, this could present a unique opportunity to capitalize on a potential rebound.
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Originally published on The Motley Fool on 2/25/2026