**Netflix’s Stock Performance and Acquisition Plans**
Netflix (NASDAQ: NFLX) has seen a 28% drop in share price since announcing a 10-for-1 stock split on October 30, 2022, while the S&P 500 has increased by approximately 1% in the same period. Currently trading at around $79 per share, analysts project a high target price of $150, indicating a potential 90% upside. The company has made a $72 billion all-cash bid to acquire Warner Bros. Discovery’s streaming and studio assets, bringing the total estimated cost, including debt, to $83 billion.
The acquisition, aimed at bolstering Netflix’s content library with popular franchises like DC Universe and Harry Potter, poses significant financial risks. Analysts have suggested that Netflix may incur up to $50 billion in debt to finance the deal, potentially affecting cash flow for content creation. Despite market apprehensions, the consensus forecast indicates Netflix’s earnings could grow by 22% annually over the next three years, justifying its current valuation relative to its historical averages.
