Netflix stock is on the verge of becoming significantly more accessible for retail investors.
High-growth companies often create substantial value over the long term, leading to soaring stock prices that can reach hundreds or even thousands of dollars. This situation can make it challenging for investors with smaller portfolios to purchase one full share. If their broker does not offer fractional shares, these investors may find themselves sidelined, unable to participate in the stock market effectively.
A company can address this issue by implementing a stock split, which increases the total number of shares available in the market while proportionately reducing the price per share. For instance, a 10-for-1 stock split would increase the company’s share count by ten times and lower the price per share by 90%. Although this does not affect the overall value of the underlying company, it allows more investors to enter the market at a much more affordable price point.
Netflix (NFLX 0.13%) stock is currently trading at over $1,100 (as of Nov. 6), but the company announced a 10-for-1 stock split last month, which is set to take effect on Nov. 17. This will mark the company’s third stock split since going public in 2002, which is quite impressive considering its staggering return of 102,570% since its initial offering.
Even though stock splits do not inherently add value to a business, they often result in stock price increases in the aftermath. This increase occurs as investors, who were previously priced out, seize the opportunity to buy shares they couldn’t afford before. With this in mind, should potential investors consider purchasing Netflix stock prior to Nov. 17?
Image source: Netflix.
Discover Why Netflix Dominates the Global Streaming Market
As of the end of 2024, Netflix boasted over 300 million subscribers, solidifying its position as the largest streaming platform for movies and television shows worldwide. Although the company has stopped reporting its membership figures, its main competitor, Walt Disney, lagged significantly behind as of June this year, with just 128 million subscribers for its Disney+ service.
Netflix continuously attracts new members by employing a range of innovative strategies. A pivotal move was the launch of a more affordable ad-supported subscription tier in 2022, priced at just $7.99 per month.
This offering now constitutes a significant portion of new sign-ups in regions where it is available, accounting for roughly half of new memberships. Each member’s value increases over time because Netflix can command higher prices for advertising slots as its user base expands. Last year, the company saw its advertising revenue doubled, and projections indicate it will potentially double again by 2025.
Today’s Change
(-0.13%) $-1.44
Current Price
$1097.02
Essential Market Data
Market Cap
$465B
Day’s Range
$1085.13 – $1103.70
52wk Range
$788.65 – $1341.15
Volume
3.7M
Avg Vol
3.5M
Gross Margin
48.02%
Dividend Yield
N/A
Another significant factor attracting new members is live programming. Last December, Netflix served as the exclusive network for National Football League (NFL) games on Christmas Day, drawing over 30 million viewers and marking the most streamed games in the sport’s history. The platform is set to host both games again this upcoming Christmas Day.
Additionally, Netflix is making substantial investments in boxing. It exclusively aired the highly publicized Jake Paul vs. Mike Tyson match last November, which was a tremendous success. Following that, it lined up several matches for 2025, including the highly anticipated Canelo Álvarez vs. Terence Crawford bout in September, which attracted a record-breaking 41 million viewers, the highest for a men’s title fight in this century.
Is Now the Right Time to Invest in Netflix Before the Stock Split?
Netflix has emerged as a formidable financial powerhouse. In the third quarter of 2025, it generated an impressive $11.5 billion in revenue, reflecting a 17.2% increase compared to the same quarter last year. This marks the fastest growth rate the company has seen in four years, underscoring the effectiveness of its advertising and live programming initiatives.
Moreover, Netflix stands out as one of the few pure-play streaming providers consistently generating profits, delivering $10.4 billion in net income over the last four quarters, translating to earnings of $23.94 per share. This financial strength enables Netflix to outspend its competitors in creating and licensing content, further solidifying its dominant market position.
However, potential investors should note that the stock is not inexpensive. As of this writing, it has a price-to-earnings ratio (P/E) of 45.9, which is considerably higher than the 34.7 P/E ratio of the Nasdaq-100 index. Essentially, this means that Netflix is priced at a premium compared to many of its peers in the technology and technology-adjacent sectors, and short-term investors anticipating substantial gains in the coming months may find themselves disappointed.
Despite this, Wall Street’s consensus estimate, as reported by Yahoo! Finance, predicts that Netflix will boost its earnings to $32.34 per share by 2026 (which will equate to $3.23 after the 10-for-1 stock split), resulting in a forward P/E of 33.9.
Data by YCharts.
This projection indicates that the stock must rise by 35% by the end of next year to maintain its current P/E of 45.9. Although it may be more expensive than the Nasdaq-100, this scenario is feasible, given that Netflix’s P/E ratio has averaged around 44 over the past three years.
Nevertheless, long-term investors who are prepared to hold onto Netflix stock for five years or more are likely to experience the best returns. This extended time frame will allow the company’s advertising business to grow and mature, producing substantial rewards for patient investors.
In summary, the decision of whether to purchase Netflix stock before Nov. 17, the first day of trading following the 10-for-1 stock split, hinges on individual investment timelines. Short-term investors might prefer to remain on the sidelines, while long-term investors could find rewarding opportunities in the years to come.
