Netflix (NASDAQ:NFLX) Shares Down 1% – Here’s Why

Netflix, Inc. (NASDAQ:NFLX)’s stock price dropped 1% on Tuesday . The company traded as low as $87.25 and last traded at $87.68. Approximately 23,611,506 shares traded hands during trading, a decline of 48% from the average daily volume of 45,197,582 shares. The stock had previously closed at $88.60.

Trending Headlines about Netflix

Here are the key news stories impacting Netflix this week:

• Positive Sentiment: Multiple analyst-style pieces argue that Netflix’s ad business is becoming a major growth driver, with 2026 ad revenue projections around $3 billion and new formats, live events, and ad-tech tools expanding monetization. Article Title
• Positive Sentiment: Several bullish writeups say Netflix could be in the early stages of a comeback, citing upside from advertising scale and stronger cash generation, with one piece raising a 12-month target far above current levels. Article Title
• Positive Sentiment: Another bullish note says Netflix’s ad empire story is “too good to ignore,” highlighting the scalability of the ad tier, higher ARPU, and the potential for ad revenue to become a meaningful share of total sales. Article Title
• Positive Sentiment: Netflix is also getting support from reports tied to the AI/content-efficiency narrative, including a $600 million deal involving Ben Affleck’s AI company and claims that Netflix could save billions over time through production efficiencies. Article Title
• Neutral Sentiment: Netflix-related mentions in broader entertainment coverage, including a new “60 Minutes” head who previously worked with Netflix projects, are not likely to have a direct material impact on the stock. Article Title
• Negative Sentiment: Some recent coverage still points out that NFLX has been trading well below its 52-week high and has had a difficult year, which keeps valuation concerns and skepticism alive. Article Title

Analyst Ratings Changes

A number of analysts have recently commented on the stock. DZ Bank reiterated a “buy” rating on shares of Netflix in a research note on Friday, April 17th. KeyCorp reiterated an “overweight” rating and issued a $115.00 price target (up from $108.00) on shares of Netflix in a research note on Tuesday, April 14th. President Capital lifted their price target on shares of Netflix from $133.00 to $134.00 and gave the stock a “buy” rating in a research note on Tuesday, March 31st. Citic Securities lifted their price target on shares of Netflix from $95.00 to $107.00 and gave the stock a “hold” rating in a research note on Monday, April 27th. Finally, Seaport Research Partners lifted their price target on shares of Netflix from $115.00 to $119.00 and gave the stock a “buy” rating in a research note on Friday, April 17th. Two investment analysts have rated the stock with a Strong Buy rating, thirty-four have assigned a Buy rating and sixteen have issued a Hold rating to the company. Based on data from MarketBeat.com, the stock has an average rating of “Moderate Buy” and a consensus target price of $114.82.

Netflix Price Performance

The firm’s 50-day moving average is $93.29 and its 200-day moving average is $93.43. The company has a debt-to-equity ratio of 0.43, a current ratio of 1.41 and a quick ratio of 1.41. The company has a market capitalization of $363.64 billion, a P/E ratio of 27.89, a price-to-earnings-growth ratio of 1.11 and a beta of 1.55.

Netflix (NASDAQ:NFLX) last announced its earnings results on Thursday, April 16th. The Internet television network reported $1.23 earnings per share (EPS) for the quarter, beating the consensus estimate of $0.76 by $0.47. The company had revenue of $12.25 billion during the quarter, compared to analyst estimates of $12.17 billion. Netflix had a net margin of 28.52% and a return on equity of 40.92%. The firm’s quarterly revenue was up 16.2% compared to the same quarter last year. During the same period in the previous year, the business posted $6.61 earnings per share. Netflix has set its Q2 2026 guidance at 0.780-0.780 EPS. Analysts predict that Netflix, Inc. will post 3.6 EPS for the current fiscal year.

Insider Activity at Netflix

In other Netflix news, Director Reed Hastings sold 407,550 shares of Netflix stock in a transaction that occurred on Friday, May 1st. The shares were sold at an average price of $93.13, for a total transaction of $37,955,131.50. Following the transaction, the director owned 3,940 shares of the company’s stock, valued at $366,932.20. The trade was a 99.04% decrease in their ownership of the stock. The sale was disclosed in a document filed with the Securities & Exchange Commission, which is available through the SEC website. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, insider David A. Hyman sold 5,722 shares of Netflix stock in a transaction that occurred on Tuesday, May 5th. The shares were sold at an average price of $88.08, for a total transaction of $503,993.76. Following the transaction, the insider directly owned 316,100 shares in the company, valued at $27,842,088. This represents a 1.78% decrease in their position. The SEC filing for this sale provides additional information. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Insiders sold a total of 1,422,769 shares of company stock valued at $135,144,073 in the last three months. Corporate insiders own 1.24% of the company’s stock.

Hedge Funds Weigh In On Netflix

Several large investors have recently added to or reduced their stakes in the company. Apriem Advisors lifted its holdings in shares of Netflix by 0.6% in the third quarter. Apriem Advisors now owns 1,567 shares of the Internet television network’s stock worth $1,879,000 after buying an additional 9 shares in the last quarter. Tortoise Investment Management LLC increased its position in Netflix by 10.8% in the third quarter. Tortoise Investment Management LLC now owns 92 shares of the Internet television network’s stock worth $110,000 after purchasing an additional 9 shares during the last quarter. Brass Tax Wealth Management Inc. increased its position in Netflix by 3.2% in the third quarter. Brass Tax Wealth Management Inc. now owns 288 shares of the Internet television network’s stock worth $345,000 after purchasing an additional 9 shares during the last quarter. Pacific Sun Financial Corp increased its position in Netflix by 1.6% in the third quarter. Pacific Sun Financial Corp now owns 574 shares of the Internet television network’s stock worth $688,000 after purchasing an additional 9 shares during the last quarter. Finally, Carl P. Sherr & Co. LLC increased its position in Netflix by 0.6% in the third quarter. Carl P. Sherr & Co. LLC now owns 1,715 shares of the Internet television network’s stock worth $2,056,000 after purchasing an additional 10 shares during the last quarter. Hedge funds and other institutional investors 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.