Netflix Is Down 42% From Its High. Here's Why I'm Buying More.

Netflix stock has fallen from the $120s to the mid-$70s amid concerns about slowing growth.

This provides an opportunity for better-than-expected results to drive a rebound in the share price.

Netflix's burgeoning ad revenue as well as aggressive share buybacks could help make that happen.

It's been a tough year for Netflix (NASDAQ: NFLX) . Shares in what is one of the most popular streaming services are down by over 20% year to date and nearly 42% from their 52-week high.

Netflix hit a new 52-week low after its latest quarterly earnings release last month. This came on the heels of investor disappointment over the guidance updates. However, following this, investors may be coming to the same conclusion I did. Namely, that after the stock's lumpy drop over the past year, it's time for the dust to settle, especially as two catalysts could sway investor sentiment, justifying at least a partial recovery.

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A year ago, Netflix traded for as much as $126.71 per share. Today, it's just under $75 per share. This steep decline has arrived in waves. Instead of steadily dropping since late 2025, the stock experienced a steep drop in late 2025/early 2026, a short-lived rebound in early to mid-2026, and another big drop in mid-2026.

Uncertainty surrounding Netflix's plans to acquire Warner Bros. Discovery drove the first pullback. This ended when Paramount Skydance outbid it. Backing out of the takeover battle brought relief to investors, who were concerned Netflix was overpaying for the media conglomerate.