3 Reasons to Buy Netflix Stock Now

Netflix (NFLX) is a leader in the streaming space. While the company continues to deliver solid operating performance, its stock has lagged the broader market over the past year.

Over the past 12 months, Netflix shares have lagged the broader market, falling roughly 20% while the S&P 500 ($SPX) gained more than 14%. The stock is also trading about 39% below its 52-week high of $134.12, reflecting a sharp pullback.

Valuation has been a concern, particularly after the strong run-up that preceded the recent decline.  Further, the uncertainty surrounding Netflix’s potential acquisition of Warner Bros. Discovery (WBD) has weighed on the stock price. More recently, the stock came under pressure after management flagged higher spending in 2026.

During the fourth-quarter earnings call, Netflix outlined plans to broaden its entertainment offerings while investing further in product and commerce capabilities. Although these initiatives will drive long-term revenue growth, a higher expense forecast adversely impacted its share price.

Despite the challenges, Netflix’s underlying fundamentals remain intact. The company continues to execute well operationally, retaining its leadership position in streaming, steadily growing its subscriber base, and expanding its advertising business. With that in mind, here are three reasons why NFLX stock is a buy now.

Netflix’s stock has slipped into what technical analysts call “oversold territory.” Oversold conditions are typically identified using the Relative Strength Index, or RSI, which indicates whether a stock is overbought or oversold. When the RSI falls below 30, it generally signals that selling pressure has been excessive.

In Netflix’s case, the weekly RSI has dropped to 26.8, placing the stock firmly in oversold territory. This contrasts with peers such as Walt Disney (DIS), whose RSI currently sits at 48.2.

An RSI reading at these levels suggests that a large portion of the negative sentiment may already be reflected in the stock price. While oversold conditions do not guarantee an immediate rebound, they can indicate that downside momentum is weakening. For investors, this setup may signal that selling pressure is becoming exhausted, potentially opening the door to a period of stabilization or renewed buying interest.