Netflix Stock Plummets, Why This Is the Best Time To Buy It After Netflix’s release of its second-quarter earnings earlier this week, many investors panicked. The price per share of the streaming company dropped significantly during the after-hours trading. While the company reported some good news, its stock was unable to withstand the fears that investors have. Many in Wall Street now believe that the multinational company has reached a saturation point. After what has been nothing short of unstoppable growth in its subscriber base, now Netflix subscriber growth has slowed down. In a report released Monday, Netflix noted that it had failed to get the number of people it had predicted to subscribe. It fell short of its target of 2.5 million for the second quarter by a whopping 1.1 million. The company had hoped to add 500,000 new subscribers in the US. Instead, it managed an increase of 160,000. Netflix executives blamed the ‘bumpy ride in an attempt to disrupt a big market.’ Many investors feel that Netflix is approaching a time when everyone the company could be trying to convince to subscribe to its service already has. The question many investors have is what the company will do when this happens. Some other investors are worried that Netflix is having troubles getting a footing in China. Yet, as …show more content…
Often the backlash can be so damaging that the company may struggle to regain its footing in the business. Yet, Netflix was able to raise its prices by 4% without making losses as a result. In fact, instead of losses, the company recorded a significant increase in profits even though 2% of its subscribers canceled their subscription. Many analysts also believe that those lost subscribers will return. While the churn rate (rate of loss of subscribers) may have been higher than Netflix initially predicted, things are looking good for the company as it goes beyond the price increase