2 Reasons to Buy Netflix Stock on the Dip
2026-07-19 04:30
•Prosper Junior Bakiny •The Motley Fool
•• • Axe Capital view
Netflix’s Dip Offers a Rare Buying Opportunity
Despite recent headwinds, Netflix’s push into sports and valuation make it worth watching.
Netflix’s share price has taken a beating recently, down 42% over the past year. That looks scary but presents a compelling opportunity. The company aims to break into sports streaming, with FIFA World Cup rights potential on the horizon — a market that, if captured, could significantly diversify revenue and boost subscriber growth. Also, Netflix’s forward price-to-earnings ratio is now below the tech sector average, suggesting the stock is cheaper than peers despite strong global brand power. For South African investors, the connection to local markets is tenuous; however, Prosus does give some indirect exposure given its large Netflix stake. The main risk here is the highly competitive streaming market and potential delays or failures in securing sports rights. If these hopes don’t materialize, the stock could stagnate or fall further. I rate my confidence here at 4 due to that uncertainty. this is just my opinion and not financial advice
I would watch Netflix closely and consider a small position on this pullback, especially for patient investors willing to wait for a turnaround. No need to rush in heavily given the risk.
- NFLX
- Prosus
- USD/ZAR
- Failure to secure sports rights
- Intense streaming competition
4/10
Netflix stock has declined 24% year-to-date and 42% over the past 12 months following disappointing Q3 guidance, despite solid Q2 results. The article argues the stock presents a buying opportunity due to Netflix's potential expansion into sports streaming and its attractive valuation metrics compared to tech sector averages.
This article was originally published by The Motley Fool and has been adapted here for Axe Capital Trading News.
Publisher: The Motley Fool
Author: Prosper Junior Bakiny
Categories: Equities, Earnings
Tickers: NFLX
Sentiment: Positive - Despite recent stock decline and missed guidance, the article presents a bullish case citing: (1) untapped opportunities in sports streaming with potential FIFA World Cup rights acquisitions, (2) attractive forward P/E valuation relative to tech sector average of 21.6, and (3) historical pattern of Netflix turning around similar situations. The author views the dip as a buying opportunity for patient investors.
Keywords: Netflix, streaming, stock valuation, sports streaming, Q2 earnings, Q3 guidance, price-to-earnings ratio
Insights:
- NFLX: Positive: Despite recent stock decline and missed guidance, the article presents a bullish case citing: (1) untapped opportunities in sports streaming with potential FIFA World Cup rights acquisitions, (2) attractive forward P/E valuation relative to tech sector average of 21.6, and (3) historical pattern of Netflix turning around similar situations. The author views the dip as a buying opportunity for patient investors.
Related coverage
- I'm Calling It: Bloom Energy Will Be a Very Different Stock After 2026 for 1 Reason
- D-Wave Quantum's CEO Sold Over 50,000 Company Shares. Here's What That Means for Investors.
- Bill Gates' Foundation Was Snubbed by Warren Buffett for the First Time in 20 Years. Buffett Is Now on Track to Offload His Entire $140 Billion Berkshire Stake by 2034.