Netflix’s Stock Faces Challenges Amid Acquisition Plans
Netflix (NASDAQ: NFLX) is currently trading at 37 times its trailing earnings, a decline from its five-year average, and down over 30% from its peak of $134 last summer. The stock is nearing its 52-week low of $82.11 as the company pursues a potentially risky $72 billion acquisition of Warner Bros. from Warner Bros. Discovery, which may exacerbate its debt levels.
The acquisition raises concerns among investors due to Warner Bros.’s recent struggles, which may complicate integration and warrant a lower valuation for Netflix’s stock amid uncertainty. Analysts suggest that given these factors, potential investors may want to adopt a cautious approach before considering buying Netflix shares.
