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Netflix’s Stock Market Evolution

Founded in 1997, Netflix initially started with DVD rentals, but it was a competitive industry as most people weren’t familiar with consuming online content.

After some financial difficulties and proposal rejections, Netflix went public under the stock exchange symbol NFLX in 2002 to increase market liquidity. Netflix stock prices steadily climbed until October 2021 (US$678) but tanked to US$182 in June 2022. Despite these hardships, Netflix’s stock prices reached a record-breaking high of 911.06 USD in December 2024.

This brings forth the question: is now a good time to invest in Netflix?

Who Owns Netflix?

Institutional shareholders or Institutional investors collectively own the majority of Netflix's shares. Their holdings primarily come from passive index funds, which means they hold stock because Netflix is included in major indices like the S&P 500.

The largest institutional holders include:

The Vanguard Group, Inc.: The single largest shareholder, holding more than 9% of Netflix's shares.
BlackRock, Inc.: The second-largest shareholder, with a stake of approximately 8%.
FMR LLC (Fidelity Investments): Holds the third-largest stake, at over 5%.
State Street Corporation: Another major investment firm, holding over 4% of the company.
Capital Research and Management Company: One of the top active managers, holding over 4% of the shares.

Besides institutional shareholders, Individual shareholders - Current and former executives are the most prominent individual shareholders.

Reed Hastings: A co-founder and former CEO, Hastings transitioned to Executive Chairman in early 2023. He remains a key individual shareholder, though his stake is just over 1%.
Ted Sarandos: The co-CEO of Netflix since 2020, he is a notable individual shareholder.
Greg Peters: The co-CEO of Netflix since 2023, he also holds a significant individual stake.
Jay Hoag: A long-time member of Netflix's board of directors, he is one of the top individual shareholders.

How to Invest in Netflix?

The two ways to purchase Netflix stocks are through cash or CFDs. For CFDs, there are two methods:

CFD trading on Netflix allows traders to profit from rising and falling stock prices. If traders can predict a price drop, they can go short and potentially make a profit.
Purchase Netflix stocks directly.

Netflix Stock Performance So Far

Netflix's stock performance has been quite volatile in the past. Returns were 11% in 2021, 51% in 2022, and 65% in 2023. However, Netflix’s stock prices for 2024 have been on the rise, and these recent soaring prices could be attributed to subscriber growth and password-sharing restrictions. Their stocks have risen by almost 72% in year-to-date trading. In comparison, their rival streaming service, Disney+, only gained 5% over the same period.

From January 2023 to September 2024, Netflix added over 50 million subscribers. The company’s revenue is also projected to grow by around 15% to almost $39 billion.

Dividends Paid Out by Netflix Per Share

Unfortunately, Netflix shareholders do not receive dividends. Netflix’s initial decision was justifiable as the company was in the early stages of development back in 2010. Despite its current rise in stock market prices, Netflix still has no plans to issue dividends or increase leverage to purchase back stock. Netflix CFO Spencer Neuman states that the company wants to prioritize “profitable growth by reinvesting in our business”.

Technical Analysis

If you’re looking to invest in Netflix, you should stay updated on its upcoming earnings disclosure for 2024. The company is expected to report an EPS of $4.20, a 99% rise from last year's same quarter. Experts view Netflix's positive estimate revisions as a good indicator of its business outlook.

Netflix shares have entered a bullish trend due to the company’s positive end-of-year result estimates. Thus, this has created an excellent opportunity for traders looking to invest. The company is also expected to continue its streak of subscriber additions, which will likely grow revenues.

Traders can invest in Netflix shares long-term, assuming stock prices will continue climbing or trading CFDs and taking advantage of price fluctuations. Before purchasing the stock, however, traders must fully comprehend the ins and outs of the company to make informed decisions.