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Netflix’s Blockbuster Comeback: A Lesson in Long-Term Investing

Netflix has reclaimed its place as a powerhouse in the global streaming industry — and its performance on Wall Street over the past decade has been nothing short of remarkable. Even after facing a sharp downturn in 2022, the company’s rebound has rewarded patient investors with massive gains.

If you had invested $1,000 in Netflix stock 10 years ago, you’d now be sitting on a portfolio worth over $11,000, thanks to an increase of more than 1,010% as of July 17, 2025.

So, how did Netflix turn the tide and outperform most of the S&P 500? And what do analysts say about its sky-high valuation today?

Let’s break it down.

A Rocky Start to the Decade — Then a Massive Turnaround

In early 2022, Netflix faced a crisis moment. For the first time in over a decade, the company lost subscribers amid intensifying competition from Disney+, Amazon Prime Video, HBO Max, and others. Its stock plummeted more than 70% from its November 2021 high.

But since hitting bottom, Netflix has made a historic comeback.

From 2022 to mid-2025, the stock has risen over 500%, thanks to three key growth drivers:

• Ad-supported streaming tier: This created a new revenue stream and attracted budget-conscious viewers.
• Expansion into live sports: Netflix secured key broadcasting rights, drawing in a broader audience base.
• Crackdown on password sharing: This move converted millions of shared users into paying customers.

According to Nielsen, Netflix remains the most-watched subscription streaming platform in the U.S., a vital metric that’s reinforced its reputation as a long-term winner among investors.

By the Numbers: What Your Investment Would Be Worth

Using Netflix’s closing share price of $1,274 on July 17, 2025, here’s what a $1,000 investment in the stock would have grown to over time:

• 1 year ago (July 2024)
  Return: +96.8%
  Total: $1,968
• 5 years ago (July 2020)
  Return: +158.5%
  Total: $2,585
• 10 years ago (July 2015)
  Return: +1,010.2%
  Total: $11,102
• Since IPO in May 2002
  Return: +118,823%
  Total: $1,189,227

Note: These figures are based on adjusted historical data and exclude post-earnings movements.

Valuation: Is Netflix Still a Buy?

Netflix now trades at approximately 59 times forward earnings — a steep premium compared to peers. For context:

• Nvidia: ~55x
• Nasdaq-100 average: ~40x

Despite the lofty valuation, analysts remain cautiously optimistic. Many maintain a “buy” rating, citing Netflix’s:

• Global subscriber base
• Strong monetization strategy
• Vision of reaching $1 trillion market cap by 2030

In its most recent quarterly report, Netflix posted:

• $11.08 billion in revenue (vs. $11.07B forecast)
• $7.19 adjusted EPS (vs. $7.08 expected)

The company continues to beat expectations, but some experts warn that the high valuation leaves little room for error.

What Financial Experts Recommend

While Netflix’s gains are impressive, financial advisors caution against stock picking based solely on past performance. The market can shift quickly, and even dominant companies face risks — from changing consumer behavior to regulatory pressure and global competition.

That’s why many advisors recommend diversified investment strategies, such as:

• Index funds (like S&P 500 funds): Spread your investment across hundreds of top companies.
• Exchange-traded funds (ETFs): Lower risk through built-in diversification.

These strategies reduce dependence on a single company’s success and are especially recommended for long-term investors aiming for steady growth with reduced volatility.

Final Thoughts: A Stock Worth Remembering — But With Caution

Netflix has undoubtedly been a star performer for those who stayed the course. A $1,000 investment made a decade ago has turned into more than $11,000, a clear example of the power of long-term investing and compound growth.

Still, given its high valuation and the ever-evolving streaming landscape, investors should weigh future potential against current risk — and ensure that their portfolios remain diversified, no matter how tempting a single stock may appear.

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