Investing in Netflix in 2023 - How to Start?
There are two ways to invest in Netflix: directly purchasing shares or speculating on price movement using CFDs. Currently, its share price has plummeted due to subscriber losses... could this be a good time to consider investing in Netflix at a lower price?
Netflix (NASDAQ: NFLX) is one of the few technology companies that has been able to rebuild itself since the Internet bubble burst in the early 2000s. The streaming platform's business has grown rapidly since then, not only in terms of revenue but also in terms of stock market value.
However, as the most recent figures have shown, Netflix shares have plummeted on the stock market, raising the following questions: why has its share price dropped? And how can you keep an eye on it?
Table of Contents
Netflix's stock market evolution
Netflix was founded in 1997, just before the Internet bubble burst, at a critical juncture in history. Netflix's activities were initially focused on DVD rentals, a competitive sector that suffered from household behavior that had not yet become accustomed to consuming content online.
Due to financial difficulties in its early years, Netflix approached Blockbuster Video and offered the video rental company a stake in the company. After the proposal was rejected, Netflix decided to go public in 2002 (under stock exchange symbol NFLX) in order to increase market liquidity.
The US company began developing its video-on-demand rental service for computers, game consoles, and mobile devices (smartphones and tablets) in addition to television by raising funds.
Netflix's share price had increased by more than 400% in the last five years, reaching $700 in November 2021, its all-time high at the time. However, the share price has dropped by more than 67% between then and the end of August, 2022.
Many people would question whether Netflix is worth investing in at such a high price. However, has this fall created a new investment opportunity?
How to Invest in Netflix Stock
There are two ways to buy Netflix stock: in cash or through CFDs. There are 2 accounts for this:
Trade.MT5: for CFD trading on Netflix. This allows you to profit from the stock's up and down movements; in theory, you can short the Netflix share if you anticipate a price drop and potentially profit from it. Remember that there is some risk involved.
Invest.MT5: You can buy Netflix stock on the spot.
Click on the following to download MetaTrader 5 and start trading today:
How to Purchase Netflix Stock on Admiral Markets
To buy and sell Netflix stock, follow these steps:
- Create a trading account.
- Log in to MetaTrader 5.
- Right Click your mouse in the Market Watch tab.
- Navigate to Symbols and enter Netflix into the search bar. Select the Netflix title and then on Show Symbol button.
- Right-click on the Netflix stock, then select New Order, and finally Buy or Sell.
Simply follow these five simple steps to position yourself to purchase Netflix! Trade upwards with the Invest.MT5 account to buy Netflix stock for cash, or trade downwards with the Trade.MT5 account to short Netflix stock CFDs.
You can also click on the banner below to register now for a risk free demo account:
Netflix Stock Performance in 2022
Earnings announcements have a major impact on share prices.
In this particular case, Netflix announced its results for the third quarter of 2022 in October. What was the data?
- Higher than expected revenues: $7.93 billion, compared to $7.84 billion expected.
- EPS: 3.1 instead of 2.14 expected.
- Subscribers: increase of 2.41 million subscribers.
These positive results have been reflected in the stock market, where Netflix shares have resumed their upward trend, though they are still far from the peak reached in 2021.
Dividends paid out by Netflix per share
Dividends are not paid to Netflix shareholders. This decision was understandable at the time of the initial public offering, as it was a company in the early stages of development that had encountered difficulties before entering the markets in 2010.
However, Netflix is no longer a start-up, and its meteoric rise in stock market prices since 2010 makes the non-payment of dividends difficult to justify.
Technical Analysis
Netflix's share price was in a long-term uptrend until November 2021, as shown in the chart. Since then, Netflix shares have plummeted, particularly after the presentation of the 2021 results, which were then amplified by the Q1 2022 results (big loss of subscribers and lower-than-expected profits).
After breaking the long-term green uptrend line, the price fell until it reached a resistance zone in the past. However, Netflix shares have since entered a bullish trend as a result of the company's Q2 and Q3 2022 results.
This has created an excellent opportunity to consider investing in Netflix stock at a lower cost.
According to Netflix's technical analysis, the price could be as follows in January 2023:
Continue to rise within the trend until it reaches the $380 resistance line.
If it breaks the channel in a downward direction, it may return to the previous support level.
As a result, before purchasing Netflix stock, it is critical to understand what is going on with the company, as reports such as earnings reports can have a significant impact on the price.
You can invest in Netflix shares for the long term with the expectation of growth, or you can trade Netflix CFDs to trade price fluctuations (up and down).
If you are interested in discovering the latest trading trends, get actionable strategies and enjoy complimentary tools, join our Advanced Trading Webinars at the click of a button:
Frequently Asked Questions:
How can I invest in Netflix without risk?
Select a regulated broker. You can verify this by inspecting the license number.
What is the best way to trade Netflix?
Create an account in your Dashboard to trade Netflix, which is the same procedure as described in the article. It applies to residents of the majority of countries.
How much does it cost to purchase Netflix stock?
The commission on Netflix shares at Admiral Markets is $0.02, with a minimum commission of $1. Add the share price at the time of purchase and multiply by the number of shares desired. Commissions are available through current promotions.
What is the value of Netflix stock?
Netflix stock is trading at the time of writing at around $326. You can find out its current price here.
You can also save money by purchasing fractional shares of Netflix.
Other articles that you might be interested in:
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