Netflix (NASDAQ:NFLX) is down about 22% so far this year amid competition and weak numbers. Insider Monkey’s proprietary database of billionaire-held stocks shows that billionaires were bailing out on a net basis earlier this year. A total of 29 billionaire-led funds had stakes in the company as of the end of the second quarter, compared with 38 funds in the prior quarter. In the last quarter of 2025, about 34 billionaire-led funds had a position in the stock.
Don’t Miss: Are Investors Too Worried About Netflix’s (NFLX) Growth?
Netflix is facing growing competition, slowing revenue growth and concerns about weak engagement. HSBC recently downgraded the stock to Hold from Buy. The firm believes Netflix is losing viewing time to YouTube, which is offering creators higher payments, direct financing and stronger marketing support in exchange for exclusive content. YouTube is also introducing features designed to present videos as episodic series, making it a more direct competitor to traditional streaming platforms.
Photo by Souvik Banerjee on Unsplash
Can Netflix Stock Rebound?
However, the bull case is that much of this weakness may already be reflected in the stock. Bulls say Netflix’s growth strategy is working. Viewing hours increased 2% to 97 billion during the first half of 2026. Live programming represents only 1% of viewing hours, but six of Netflix’s 10 strongest subscriber-acquisition days during the past five years occurred alongside major live events. These programs could attract new subscribers while creating valuable advertising inventory.
Netflix is also expanding into podcasts, live television and cloud gaming. Usage of Netflix Playground has tripled since its April launch, while its partnership with France’s TF1 could create a model for adding live television channels in other markets. Generative AI could also improve recommendations, reduce production costs and help advertisers create campaigns.
Valuation
Netflix’s forward non-GAAP P/E is 19.82, about 52% above the sector median of 13.03. However, that multiple is roughly 43% below Netflix’s five-year average of 34.91, showing how sharply its valuation has fallen. The stock is therefore not cheap compared with the wider sector, but it is trading at a substantial discount to its own historical valuation. A rebound in the stock price is possible, but it will depend on Netflix stabilizing engagement, producing stronger original content and proving that advertising, live programming and gaming can become meaningful growth drivers.
READ NEXT: 33 Stocks That Should Double in 3 Years and Cathie Wood 2026 Portfolio: 10 Best Stocks to Buy.
