Netflix (NASDAQ:NFLX) Trading Down 3.4% – Should You Sell?

Shares of Netflix, Inc. (NASDAQ:NFLX) traded down 3.4% during trading on Tuesday . The stock traded as low as $79.62 and last traded at $79.94. 49,314,293 shares changed hands during mid-day trading, a decline of 5% from the average session volume of 51,753,172 shares. The stock had previously closed at $82.76.

Key Headlines Impacting Netflix

Here are the key news stories impacting Netflix this week:

• Positive Sentiment: Ad business momentum — Netflix’s ad tier is showing strong growth (reported ~$1.5B in ad revenue), supporting a new growth engine and higher margin potential. Netflix’s Ad Revenue Surges to $1.5 Billion
• Positive Sentiment: Analyst support — recent broker coverage includes upgrades/positives (Freedom Capital Markets upgrade to Buy; Bernstein reiterates Buy), which can help cushion downside if deal progress continues. Freedom Capital Markets Upgrades Netflix To Buy Bernstein Remains a Buy on Netflix
• Neutral Sentiment: Warner Bros. vote timeline — reports say Warner Bros. Discovery shareholders are likely to hold a vote on the transaction in March, which is a near‑term corporate milestone investors will watch for deal clearance or conditions. Warner Bros’ shareholders likely to hold vote on Netflix deal in March: Report
• Neutral Sentiment: Options market signal — short‑term options “max pain” analysis points to an $88 level by Feb. 20, suggesting traders are positioning for continued near‑term rangebound action. Netflix Max Pain Points to a Price of $88
• Negative Sentiment: Heightened regulatory/antitrust scrutiny — Netflix co‑CEO Ted Sarandos was questioned by a Senate panel about competitive effects of the proposed Warner Bros. deal; lawmakers flagged consumer and labor concerns that raise the chance of regulatory hurdles. Netflix co‑CEO faces grilling by US Senate panel over Warner Bros deal
• Negative Sentiment: Political and reputational risk — at the Senate hearing one senator publicly accused Netflix of promoting certain content to children, which adds a political/PR angle that could complicate regulatory optics. Netflix co‑CEO grilled by US senators over Warner Bros. Discovery merger
• Negative Sentiment: Talent and production friction — a German voice‑actors boycott over an AI‑training clause creates operational and PR headwinds in local markets and highlights labor tensions around tech use. German voice actors boycott Netflix over AI training concerns
• Negative Sentiment: Insider selling & deal skepticism — recent CEO stock sales and commentary about regulatory obstacles have amplified investor concern that the bidding/approval process could be protracted or costly. Insider Selling: Netflix CEO Sells Stock The Biggest Obstacle to Netflix Acquiring Warner Bros.

Wall Street Analyst Weigh In

A number of equities research analysts have weighed in on NFLX shares. William Blair reaffirmed an “outperform” rating on shares of Netflix in a report on Wednesday, January 21st. Cfra Research downgraded Netflix from a “strong-buy” rating to a “hold” rating in a research note on Monday, January 5th. Wedbush reaffirmed an “outperform” rating and set a $115.00 price objective on shares of Netflix in a report on Wednesday, January 21st. Jefferies Financial Group reiterated a “buy” rating on shares of Netflix in a research report on Wednesday, January 21st. Finally, Seaport Research Partners upgraded shares of Netflix from a “hold” rating to a “strong-buy” rating in a research report on Monday, October 6th. Two analysts have rated the stock with a Strong Buy rating, thirty-three have issued a Buy rating and seventeen have issued a Hold rating to the company’s stock. According to MarketBeat.com, Netflix has an average rating of “Moderate Buy” and a consensus price target of $116.17.

Netflix Stock Performance

The firm has a fifty day moving average of $93.28 and a 200-day moving average of $109.54. The company has a quick ratio of 1.19, a current ratio of 1.19 and a debt-to-equity ratio of 0.51. The stock has a market capitalization of $337.52 billion, a price-to-earnings ratio of 31.63, a PEG ratio of 1.48 and a beta of 1.71.

Netflix (NASDAQ:NFLX) last posted its earnings results on Tuesday, January 20th. The Internet television network reported $0.56 earnings per share for the quarter, beating the consensus estimate of $0.55 by $0.01. Netflix had a return on equity of 43.26% and a net margin of 24.30%.The company had revenue of $12.05 billion for the quarter, compared to analyst estimates of $11.97 billion. During the same quarter in the prior year, the company earned $0.43 earnings per share. Netflix’s revenue was up 17.6% compared to the same quarter last year. Netflix has set its Q1 2026 guidance at 0.760-0.760 EPS. As a group, sell-side analysts anticipate that Netflix, Inc. will post 24.58 EPS for the current year.

Insider Activity

In other Netflix news, insider David A. Hyman sold 23,439 shares of the firm’s stock in a transaction dated Friday, January 16th. The shares were sold at an average price of $88.11, for a total transaction of $2,065,210.29. Following the completion of the transaction, the insider directly owned 316,100 shares in the company, valued at approximately $27,851,571. This trade represents a 6.90% decrease in their position. The transaction was disclosed in a legal filing with the SEC, which can be accessed through this link. Also, CEO Gregory K. Peters sold 105,781 shares of Netflix stock in a transaction dated Thursday, January 29th. The stock was sold at an average price of $82.94, for a total transaction of $8,773,476.14. Following the transaction, the chief executive officer owned 122,140 shares of the company’s stock, valued at approximately $10,130,291.60. The trade was a 46.41% decrease in their position. The disclosure for this sale is available in the SEC filing. Insiders sold a total of 967,530 shares of company stock worth $93,977,519 in the last three months. Company insiders own 1.37% of the company’s stock.

Institutional Investors Weigh In On Netflix

A number of large investors have recently bought and sold shares of the stock. EWA LLC increased its position in Netflix by 904.2% during the fourth quarter. EWA LLC now owns 7,682 shares of the Internet television network’s stock worth $720,000 after buying an additional 6,917 shares in the last quarter. Centerpoint Advisory Group boosted its stake in shares of Netflix by 900.0% during the fourth quarter. Centerpoint Advisory Group now owns 6,420 shares of the Internet television network’s stock valued at $602,000 after acquiring an additional 5,778 shares during the last quarter. NewEdge Wealth LLC boosted its stake in shares of Netflix by 1,296.2% during the fourth quarter. NewEdge Wealth LLC now owns 212,701 shares of the Internet television network’s stock valued at $19,943,000 after acquiring an additional 197,467 shares during the last quarter. Stiles Financial Services Inc increased its position in Netflix by 403.7% during the 4th quarter. Stiles Financial Services Inc now owns 6,775 shares of the Internet television network’s stock worth $635,000 after purchasing an additional 5,430 shares in the last quarter. Finally, Triton Financial Group Inc raised its stake in Netflix by 926.9% in the 4th quarter. Triton Financial Group Inc now owns 22,295 shares of the Internet television network’s stock valued at $2,090,000 after purchasing an additional 20,124 shares during the last quarter. Institutional investors and hedge funds own 80.93% of the company’s stock.

About Netflix

Netflix, Inc (NASDAQ: NFLX) is a global entertainment company that provides subscription-based streaming of films, television series, documentaries and other video content. Founded in 1997 by Reed Hastings and Marc Randolph and headquartered in Los Gatos, California, the company began as a DVD-by-mail rental service and introduced streaming video in 2007. Netflix later expanded into producing and distributing original programming, beginning notable original hits in the 2010s, and now operates a content production and distribution ecosystem alongside its licensing activity.

The company’s primary product is its on-demand streaming service, which can be accessed on a wide range of internet-connected devices and delivered through a suite of apps and web platforms.