![]() In particular, the slowing growth in the key international segment could challenge Netflix's relatively high valuation, especially since the stock sports a triple-digit price-to-earnings ratio because of investor perceptions of strong growth prospects. For instance, the stock fell 12% in April, following a quarterly report that included sluggish guidance for the second quarter, and relatively small numbers of new subscribers. Part of the reason why Netflix stock hasn't performed well after its 2015 split is that it hasn't been able to live up to investor expectations. Will Netflix Split the Stock in 2023 2022 has been one of the worst years for Netflix and the share price fell by more than 50 in the year. The firm lowered its price target on Netflix shares from 305. Hastings was reported as saying that the reduction in Netflix's share price would increase access to shareholders, making it easier for investors to buy shares of the company. The share price has again run up post-2015 split from 100 to 700 in November 2021 but there was no indication of an upcoming stock split from Netflix management. The stock closed down 35.1 on Wednesday, to 226.19 per share, marking Netflix’s biggest one-day drop ever in percentage terms. The company added 3.28 million subscribers in the second quarter alone - more than double its total subscriber count from 2004.Īlthough net income for the quarter was fairly low, at $26 million, previous quarters had seen bottom-line figures of as much as $83 million. ![]() Having added the streaming video service, Netflix boasted 65 million members worldwide in the second quarter of the year, with 42 million domestic subscribers, and 23 million international customers. As CEO Reed Hastings noted at the time, the split "reflects the strong organic and sustained growth of the Netflix model," and he predicted further growth and sustained momentum in subsequent years.įast-forward to 2015, and Netflix looked a lot different. Churn had fallen below the 5% mark to reach record lows, and the company had just reported net income of $2.3 million. On 31st May 2002, the stock opened at 1.08 and closed at 1.00. The company was in hyper-growth mode, bringing in 444,000 new trial subscribers in the fourth quarter of 2003, to bring its total subscriber count to just shy of 1.49 million. That closing price is 1.20 per present-day share after adjusting for stock splits. (Source: Is a Netflix Stock Split Likely in 2017 The Motley. Why Netflix split its sharesīack in 2004 when Netflix first split its stock, the business looked a lot different than it does now. NFLX stock had split one time prior to that as well, in February of 2004, lowering the share price by a factor of two-for-one. Once more, in the time since the 7-for-1 2015 split was completed, Netflix stock hasn't made any major moves, falling slightly over the past year. Netflix wasn't as quick to split its shares again, but eventually, the company decided that it made sense to bring its share price back down toward the $100 range. Netflix stock remained stagnant for several years following the 2004 split, but in the rebound from the recession of 2008, the stock climbed from $18 per share to upward of $700 per share by 2015. Between October 2002 and January 2004, the company saw its shares climb by more than 1,500%, and when the stock approached $80 per share, Netflix made the decision to do a traditional 2-for-1 split. As of Thursday, that investment would be worth about $293,000, which is a pretty good return.Both of Netflix's stock splits have come following periods of extremely strong stock performance. The chart below shows the value of a $1,000 investment in Netflix stock made at the first day's split-adjusted closing price of $1.20 per share over the following 16 years. ET on Thursday, Netflix was trading at an all-time high of $350.41 per share, with a market capitalization surpassing that of the entertainment mega-giant Disney. Wednesday was the 16th anniversary of Netflix's initial public offering, and an investor buying in then would have made a very impressive return over the years.Īfter initially offering its stock at $15 per share on May 23, 2002, Netflix closed its first day of trading at $16.75, or $1.20 per present-day share after adjusting for stock splits, according to data from Yahoo Finance.Īs of 12:25 p.m. Wednesday was the 16th anniversary of Netflix's initial public offering.Ī $1,000 investment made at the stock's first-day closing price would be worth nearly $300,000 today.
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