Netflix, Inc. provides entertainment services. It offers TV series, documentaries, feature films, and games across various genres and languages. The company also provides members the ability to receive streaming content through a host of internet-connected devices, including TVs, digital video players, TV set-top boxes, and mobile devices. It has operations in approximately 190 countries. The company was incorporated in 1997 and is headquartered in Los Gatos, California.

Netflix, Inc.

Rule Breaker Investing Mailbag: Be a for Person, Not an Against Person

Key Points
Netflix appeared to make the most attractive bid for Warner Bros. Discovery’s studio and streaming businesses late last week.
A competing bid has surfaced, showing what this dramatic bidding war suggests about Netflix’s place in the streaming business.
If there was any lingering doubt that the fragmented streaming market is consolidating, it was just wiped away. Late last week, industry-leading Netflix (NASDAQ: NFLX) made the winning bid for Warner Bros. Discovery's (NASDAQ: WBD) streaming platforms and studio, beating out Paramount Skydance (NASDAQ: PSKY) and Comcast (NASDAQ: CMCSA) for the prized HBO and HBO Max brands.
Paramount isn't simply letting go, though. On Monday, it made what it argues is a better offer for the entirety of Warner, including Warner Bros. Discovery's cable television assets. The suitor says its deal could also be completed sooner, since it wouldn't need to wait for Warner's split-up (announced in June) before proceeding.
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Antitrust concerns have already surfaced, with both bidders saying their plan presents the lower risk of becoming a competition-quelling monopoly. It's also possible that the Department of Justice won't like either plan well enough to allow it to proceed.
Whatever awaits, the recent drama confirms that Netflix is not only the big name to beat in the streaming business, but that it's setting the tone and pace for the entire industry. That bodes well for current and prospective shareholders.
The suitors' targeted prize
Netflix's offer values Warner Bros. Discovery's streaming business and studio at $72 billion, after absorbing nearly $11 billion in debt. That's for a studio currently turning about $12 billion in annual revenue into EBITDA in the ballpark of $2 billion, and a streaming business that turned a little over $10 billion in annual sales into $677 million worth of operating profit last fiscal year. It would also bring IP like Warner's Batman and Superman, Game of Thrones, and Looney Tunes to the table.
Notably, Netflix's offer didn't include Warner's television assets, like CNN, Animal Planet, TNT, or Discovery, which generated more than $20 billion in revenue last year, and just over $8 billion in EBITDA. That's not the case with Paramount Skydance's $108.4 billion offer, which is for the entirety of Warner Bros. Discovery as it stands today.
For perspective, Netflix is currently turning roughly $45 billion in yearly revenue into income on the order of $11 billion, versus an adjusted EBITDA of $9 billion on $39.3 billion in sales for Paramount last fiscal year.
There's one stark difference between these two entertainment companies' results. Netflix's business continues to grow, while Paramount Skydance's is on the defensive. Of course, both companies could still do something impressive with Warner's intellectual property and brand names, even if we don't yet know exactly what that might be -- that is, if the DOJ's antitrust arm allows either deal to go through.
Given the rhetoric right now, Netflix's odds of ending up owning Warner's streaming assets and studio are arguably somewhere in the ballpark of 50/50. Paramount's are only slightly better, however. It already owns a streaming platform with nearly 80 million subscribers of its own (Paramount+), along with cable channels Comedy Central, CMT, and Nickelodeon, plus broadcast network CBS. Any argument that its deal wouldn't eliminate too much competition isn't exactly on solid ground, either.
To current and future Netflix shareholders, whether or not it's ever allowed to own any part of Warner Bros. Discovery just became secondary. The acquisition drama so far confirms a handful of bullish things about the company.
With or without Warner, Netflix wins
Don't misunderstand. Netflix would love to bring the Warner Bros. Discovery film and television studio into the fold, along with consumer-favorite franchises like DC's superhero lineup and Harry Potter, as well as most of Warner's 128 million streaming subscribers. Even if it ends up not happening, the story so far sends a handful of subtle bullish messages about Netflix's place within the streaming business.
1. Its current size makes it the name that others want to work with
We don't know how much Paramount privately offered for Warner Bros. Discovery, or the terms of those offers. But it's probable that Paramount Skydance's original offer made to Warner's board of directors looks pretty similar to the one it's now making directly to WBD shareholders.
Warner's board opted to sell to Netflix anyway, perhaps recognizing that Netflix is in a position to do the most with the assets it would be selling. That makes sense. It's also the world's biggest streaming platform, with more than 300 million paying customers as of the end of last year. It's easier to remain the biggest than it is to become the biggest.
It may end up meaning nothing this time around. It's a hint, however, that Netflix has a "first dibs" kind of authority when the next acquisition prospect surfaces.
2. It confirms that Netflix is regarded as the industry's leading powerhouse
Similarly, Paramount Skydance's somewhat reactionary response to Netflix's successful bid indicates panic that the already-biggest name in the business could get even bigger. Paramount probably doesn't really want Warner Bros. Discovery's deteriorating television business (which presents antitrust concerns of its own). It's just willing to take it in order to prevent Netflix from gaining any part of Warner.
3. If the deal gets done, Netflix could become a force on multiple fronts
Finally, given the possibility that the antitrust-minded pushback is more noise than substance and Netflix's offer for Warner Bros. will become a done deal, Netflix stands to bolster its growth as a result.
Not everyone agrees. As Morningstar analyst Matthew Dolgin put it, "We think that any realistic amount Netflix would pay to acquire the Warner Bros. streaming and studio businesses would be value-destructive," citing significant overlap in its customer base. He's not wrong.
Combining two overlapping customer bases isn't all this pairing would bring to the table, though. Melding the two companies into one could allow Warner to also become a licensing and distribution arm for Netflix's in-house content that's mostly contained within its own distribution silo right now. And it's not exactly a secret that Netflix is increasingly eyeing reach beyond its customers' homes, including the silver screen.
Forget the numbers (for now) and just think philosophically
Bottom line? Yes, Netflix stock has been understandably dragged down by the prospect of the deal. It's seemingly a lot of money for a questionable amount of value.
Now look at the bigger picture. The streaming industry is consolidating itself anyway, largely out of necessity for most. Netflix is better served by proactively managing this shift and acquiring properties with staying power, rather than being reactionary to this change and then not being able to buy or build anything worth owning.
It also might be wise to simply trust the decision of the management team that created the industry it now leads.
Should you invest $1,000 in Netflix right now?
Before you buy stock in Netflix, consider this:
The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Netflix wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.
Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $499,978!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,126,609!*
Now, it’s worth noting Stock Advisor’s total average return is 971% — a market-crushing outperformance compared to 195% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.
*Stock Advisor returns as of December 8, 2025
James Brumley has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Netflix and Warner Bros. Discovery. The Motley Fool recommends Comcast. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

The Streaming Wars Are Consolidating, and Netflix May Be the Biggest Winner

Below is Validea's guru fundamental report for NETFLIX INC (NFLX). Of the 22 guru strategies we follow, NFLX rates highest using our P/E/Growth Investor model based on the published strategy of Peter Lynch. This strategy looks for stocks trading at a reasonable price relative to earnings growth that also possess strong balance sheets.
NETFLIX INC (NFLX) is a large-cap growth stock in the Business Services industry. The rating using this strategy is 87% based on the firm’s underlying fundamentals and the stock’s valuation. A score of 80% or above typically indicates that the strategy has some interest in the stock and a score above 90% typically indicates strong interest.
The following table summarizes whether the stock meets each of this strategy's tests. Not all criteria in the below table receive equal weighting or are independent, but the table provides a brief overview of the strong and weak points of the security in the context of the strategy's criteria.
Detailed Analysis of NETFLIX INC
More Information on Peter Lynch
About Peter Lynch: Perhaps the greatest mutual fund manager of all-time, Lynch guided Fidelity Investment's Magellan Fund to a 29.2 percent average annual return from 1977 until his retirement in 1990, almost doubling the S&P 500's 15.8 percent yearly return over that time. Lynch's common sense approach and quick wit made him one of the most quoted investors on Wall Street. ("Go for a business that any idiot can run -- because sooner or later, any idiot probably is going to run it," is one of his many pearls of wisdom.) Lynch's bestseller One Up on Wall Street is something of a "stocks for the everyman/everywoman", breaking his approach down into easy-to-understand concepts.
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About Validea: Validea is aninvestment researchservice that follows the published strategies of investment legends. Validea offers both stock analysis and model portfolios based on gurus who have outperformed the market over the long-term, including Warren Buffett, Benjamin Graham, Peter Lynch and Martin Zweig. For more information about Validea, click here
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Guru Fundamental Report for NFLX - Peter Lynch

In this video, I will cover two beaten-down stocks and share my thoughts on the Netflix, Warner Bros. Discovery, and Paramount acquisition situation. Watch the short video to learn more, consider subscribing, and click the special offer link below.
*Stock prices used were from the trading day of Dec. 8, 2025. The video was published on Dec. 8, 2025.
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Should you invest $1,000 in Roblox right now?
Before you buy stock in Roblox, consider this:
The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Roblox wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.
Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $521,550!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,133,904!*
Now, it’s worth noting Stock Advisor’s total average return is 981% — a market-crushing outperformance compared to 194% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.
*Stock Advisor returns as of December 8, 2025
Neil Rozenbaum has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Netflix, Roblox, and Warner Bros. Discovery. The Motley Fool recommends Grab. The Motley Fool has a disclosure policy. Neil is an affiliate of The Motley Fool and may be compensated for promoting its services. If you choose to subscribe through his link, he will earn some extra money that supports his channel. His opinions remain his own and are unaffected by The Motley Fool.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

2 Under the Radar Growth Stocks Down 30% to Buy Before 2026

Key Points
Stock splits in high-profile companies have piqued the interest of retail investors and Wall Street professionals this year.
The market's blockbuster stock split of 2025 can soar 55% in the new year, based on the projections from one Wall Street analyst.
Meanwhile, the highest-profile reverse split could rise by triple digits, but it has an undeniably bumpy road ahead.
Since the beginning of 2023, no innovation has garnered more attention on Wall Street than the rise of artificial intelligence (AI). However, AI isn't the only trend that's been lifting the stock market's tide. Investor euphoria regarding stock splits in influential businesses has played an important role in fueling optimism on Wall Street.
In 2025, five brand-name companies have taken the plunge and completed splits, including Netflix (NASDAQ: NFLX), O'Reilly Automotive (NASDAQ: ORLY), Lucid Group (NASDAQ: LCID), Fastenal (NASDAQ: FAST), and Interactive Brokers Group (NASDAQ: IBKR).
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A stock split is a tool publicly traded companies have at their disposal to cosmetically adjust their share price and outstanding share count by the same factor. These changes are purely superficial in the sense that they don't affect a company's market cap or operating performance.
In addition to piquing the interest of everyday investors, stock splits can also garner the attention of Wall Street professionals. Based on the high-water price targets of select Wall Street analysts, two of the aforementioned five high-profile stock-split stocks offer up to 135% upside in 2026.
Netflix: Implied upside of 55%
The first high-flying stock-split stock that at least one Wall Street analyst believes can soar in the new year is streaming services provider Netflix, which completed a 10-for-1 forward split in mid-November.
On July 18, Jefferies analyst James Hawley kept his firm's buy rating on Netflix stock but upped the price target to $1,500, which is now a split-adjusted $150 per share and represents 55% upside from where shares closed on Dec. 8. In the research note, Hawley highlighted that North American sales growth (U.S. and Canada) has jumped to 15% from 9%, which suggests customer churn remains low, even as the company has increased its prices.
The note also adds that Netflix can grow its earnings per share (EPS) by more than 20% annually over the next three to five years.
There's little question that Netflix continues to ride its first-mover advantage to substantial profits. It's overseen more original content releases than any of its peers, with shows like Stranger Things and Squid Game attracting new subscribers and ensuring existing customers remain within its ecosystem.
Netflix has also been successful with its innovation beyond the big screen. A little over three years ago, the company introduced an advertising-based tier as a more affordable option for its streaming subscribers. As of May 2025, approximately 94 million people had signed up for this ad-driven option.
Likewise, Netflix finally cracked down on password-sharing in May 2023 by requiring that accounts remain within a single household. The solutions offered by the company, which include paying for an extra member or having people outside the household set up a paid account in their name, have boosted total subscribers and profitability.
But it's not clear if Netflix shares can reach this lofty price target in 2026, given its recently announced deal to acquire Warner Bros. Discovery, following the separation of Discovery Global, for $82.7 billion, which works out to $23.25 per share in cash and $4.50 per share in Netflix stock.
On paper, the deal makes plenty of sense, with Netflix gaining access to HBO and HBO Max, as well as Warner Bros.' valuable studio segment. However, serious antitrust questions will arise from this deal, which could cast a grey cloud above the company's stock throughout much of 2026. While this doesn't mean the deal won't get done, the legal and profit-driven uncertainties associated with this buyout may weigh on Netflix for the foreseeable future.
Lucid Group: Implied upside of 135%
Whereas Netflix, O'Reilly Automotive, Fastenal, and Interactive Brokers Group all completed forward splits this year, electric-vehicle (EV) maker Lucid Group was the most-hyped reverse split of 2025. Its 1-for-10 reverse split, which lifted its share price from around $2 to closer to $20, went into effect in early September.
Investors typically gravitate toward public companies announcing and completing forward splits, and shy away from businesses that undertake reverse splits. Companies that need to increase their share price are often struggling on an operating basis and splitting their shares to avoid delisting from a major stock exchange.
Despite what history tells us, Benchmark's Mickey Legg has an optimistic view of Lucid Group stock for 2026. Even though he lowered his firm's price target on the company this year, the $30 Legg expects for Lucid shares would imply upside of 135%!
Legg's optimism for Lucid crescendoed in mid-July, which is when Lucid announced a partnership with Uber Technologies and privately held Nuro to launch a global robotaxi program. Lucid will be responsible for delivering 20,000 (or more) of its Gravity SUVs over six years.
However, Lucid has endured several missteps during its attempted production ramp-up, to the point where it's becoming difficult for investors to believe management's growth and production forecasts.
With Tesla moving away from its luxury Model S to mass-produce the more affordable Model 3 sedan, the luxury EV space was ripe for the taking. But due to a myriad of supply chain issues that coincided with and followed the COVID-19 pandemic, Lucid Air sedan production and delivery figures have been a major disappointment. While management had predicted 90,000 units of production for 2024 when the company went public in 2021, guidance had fallen to just 9,000 units of production by the time 2024 arrived.
Lucid also missed its opportunity with Gravity. Initially, the company's SUV was expected to hit showroom floors in 2024. This launch was eventually delayed until the spring of this year.
Perhaps the biggest snag in Legg's optimistic price target is Lucid's balance sheet. Although the company has received billions of dollars in backing from Saudi Arabia's Public Investment Fund, it's been burning cash and losing money at an extraordinary rate. It's burned through more than $2 billion in cash from its operating activities in the first nine months of 2025 and has lost close to $14.8 billion since the company was incepted.
Building an EV company from the ground up to mass production is a costly and time-consuming process. Lucid Group hasn't yet demonstrated that it possesses the necessary tools or intangibles to succeed, which makes it unlikely that Legg's lofty price target will be achieved in 2026.
Should you invest $1,000 in Netflix right now?
Before you buy stock in Netflix, consider this:
The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Netflix wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.
Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $521,550!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,133,904!*
Now, it’s worth noting Stock Advisor’s total average return is 981% — a market-crushing outperformance compared to 194% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.
*Stock Advisor returns as of December 8, 2025
Sean Williams has positions in Warner Bros. Discovery. The Motley Fool has positions in and recommends Interactive Brokers Group, Jefferies Financial Group, Netflix, Tesla, Uber Technologies, and Warner Bros. Discovery. The Motley Fool recommends the following options: long January 2027 $43.75 calls on Interactive Brokers Group and short January 2027 $46.25 calls on Interactive Brokers Group. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

2 Stock-Split Stocks With Up to 135% Upside in 2026, According to Select Wall Street Analysts

Key Points
Growth stocks may not be predictable, but they have the potential to generate incredible returns for investors.
Nvidia, Netflix, and Booking Holdings have been some of the best growth stocks to own over the past two decades.
These companies have all established themselves as leading players in their respective industries.
It isn't always obvious that a growth stock will take off and generate massive returns for your portfolio. However, that's one of the reasons why sometimes taking a chance on an up-and-coming stock can be a worthwhile move, even if you're not entirely confident that it'll be successful. Taking on some risk can result in monstrous gains and rewards later on.
Three stocks that have made long-term investors rich over the past two decades include Nvidia (NASDAQ: NVDA), Netflix (NASDAQ: NFLX), and Booking Holdings (NASDAQ: BKNG). Here's a look at just how much your investment would be worth if you bought $5,000 worth of shares in each of these companies 20 years ago.
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1. Nvidia: $3 million
The least-surprising stock on this list is likely Nvidia. The chipmaker has made people rich over just the past five years, let alone 20. If you invested $5,000 into the tech stock back on Dec. 1, 2005, your investment would be worth a staggering $3 million right now.
Today, Nvidia has become the most valuable company in the world, with a market cap of $4.5 trillion. A couple of decades ago, it was primarily known for its graphics cards. Nowadays, its cutting-edge chips are used in the development of artificial intelligence (AI) models, which has led to game-changing results for the business.
Over the past four quarters, the company has generated $187 billion in revenue. Just a few years ago, the company's annual revenue was less than $30 billion. Nvidia's gains have come rapidly, and for investors who want exposure to artificial intelligence (AI), this can be one of the safer stocks to hang on to for the long haul.
2. Netflix: $1.2 million
Another stock that would have made you rich over the past 20 years is streaming giant Netflix. A $5,000 investment a couple of decades ago would now have ballooned to be worth $1.2 million. Its ascent has been more gradual than Nvidia's, and there have been challenges along the way. However, Netflix has established itself as a leader in video streaming.
The company's relentless pursuit of growth is evident with its recent acquisition attempt of Warner Bros. Discovery for $72 billion. Although the deal may not end up going through, as Paramount Skydance has announced a hostile bid, and there are concerns about whether this may hurt competition, it's yet another example of Netflix looking for ways to grow and add value for its customers.
The streaming giant has gone from posting losses to now enjoying strong profit margins of 24%. Netflix is a household name and yet another good growth stock to hold for the long haul.
3. Booking Holdings: $1.1 million
Rounding out this list of impressive stocks is Booking Holdings. A $5,000 investment in the business 20 years ago would now be worth around $1.1 million. The growth in the travel industry, particularly in online bookings, has enabled it to grow at an incredible pace.
Last year, it reported $23.7 billion in sales and $5.9 billion in profit, a significant improvement from the $11 billion in sales it posted just three years earlier, when its bottom line was around $1.2 billion. Analysts from Grand View Research project that the online travel booking market is still growing at a compounded annual growth rate of roughly 10% until 2030, as there's still more growth potential ahead for Booking Holdings.
Given the plentiful opportunities ahead, it may still not be too late to invest in Booking Holdings stock. It trades at a forward price-to-earnings multiple of 21, based on analyst expectations. That's slightly below the S&P 500 average of 22. For long-term growth investors, this can be a fantastic investment to simply buy and hold.
Should you invest $1,000 in Nvidia right now?
Before you buy stock in Nvidia, consider this:
The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Nvidia wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.
Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $521,550!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,133,904!*
Now, it’s worth noting Stock Advisor’s total average return is 981% — a market-crushing outperformance compared to 194% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.
*Stock Advisor returns as of December 8, 2025
David Jagielski, CPA has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Booking Holdings, Netflix, Nvidia, and Warner Bros. Discovery. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

3 Stocks That in 20 Years Have Turned $5,000 Into More Than $1 Million

In this video, Motley Fool contributors Jason Hall and Jeff Santoro break down the latest competing deals for Warner Bros. Discovery (NASDAQ: WBD), between the agreed-upon deal with Netflix (NASDAQ: NFLX) and the hostile tender offer from Paramount Skydance (NASDAQ: PSKY).
*Stock prices used were from the afternoon of Dec. 8, 2025. The video was published on Dec. 10, 2025.
Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. Continue »
Should you invest $1,000 in Netflix right now?
Before you buy stock in Netflix, consider this:
The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Netflix wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.
Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $521,550!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,133,904!*
Now, it’s worth noting Stock Advisor’s total average return is 981% — a market-crushing outperformance compared to 194% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.
*Stock Advisor returns as of December 8, 2025
Jason Hall has no position in any of the stocks mentioned. Jeff Santoro has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Netflix and Warner Bros. Discovery. The Motley Fool has a disclosure policy. Jason Hall is an affiliate of The Motley Fool and may be compensated for promoting its services. If you choose to subscribe through their link they will earn some extra money that supports their channel. Their opinions remain their own and are unaffected by The Motley Fool.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Netflix vs. Paramount: Who Wins the Battle for Warner Bros. Discovery?

The S&P 500 Index ($SPX) (SPY) on Wednesday closed up by +0.67%, the Dow Jones Industrials Index ($DOWI) (DIA) closed up by +1.05%, and the Nasdaq 100 Index ($IUXX) (QQQ) closed up by +0.42%. December E-mini S&P futures (ESZ25) rose +0.66%, and December E-mini Nasdaq futures (NQZ25) rose +0.44%.
Stock indexes shook off early weakness on Wednesday and settled higher, with the S&P 500 posting a 6-week high, the Nasdaq 100 a 5-week high, and the Dow Jones Industrial Average a 3.5-week high. Stocks rallied on Wednesday after the Fed cut interest rates by 25 bp and Fed Chair Powell took a less hawkish tone than anticipated. Stocks also found support after the Fed raised its US 2025 GDP forecast and lowered its core PCE price forecast. In addition, the Fed boosted market liquidity by saying it will purchase $40 billion of T-bills per month to rebuild reserves.
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Stocks found some support today amid signs of easing wage pressures, which are dovish for Fed policy, after the US Q3 employment cost index rose by +0.8% q/q, slightly weaker than the +0.9% q/q expected.
US MBA mortgage applications rose +4.8% in the week ended December 5, with the purchase mortgage sub-index down -2.4% and the refinancing mortgage sub-index up +14.3%. The average 30-year fixed rate mortgage rose +1 bp to 6.33% from 6.32% in the prior week.
The FOMC, as expected, cut the fed funds target range by 25 bp to 3.50%-3.75% in a 9-3 vote and said it will consider "the extent and timing of additional adjustments" to interest rates. The FOMC noted that "job gains have slowed this year" and "downside risks to employment rose in recent months." Also, "inflation has moved up since earlier in the year and remains somewhat elevated."
The Fed's "dot plot" of interest rate projections shows the median forecast for the fed funds rate is 3.375% for the end of 2026, implying one 25 bp rate cut next year, unchanged from September.
The FOMC raised its 2025 GDP estimate to 1.7% from 1.6% in September and raised its 2026 GDP estimate to 2.3% from 1.8% in September. The FOMC cut its 2025 core PCE price estimate to 3.0% from 3.1% in September and cut its 2026 core PCE price estimate to 2.5% from 2.6% in September.
The Fed said it will begin buying $40 billion of Treasury bills per month starting December 12 to rebuild reserves in the financial system, which shrank as it tightened its balance sheet.
Fed Chair Powell signaled the Fed may now pause its interest rate cutting campaign when he said the Fed is now "within a range of plausible estimates of neutral and leave us well positioned to determine the extent and timing of additional adjustments" to rates. He added that he doesn't think a rate hike is anybody's base case for the Fed's next policy move.
The markets this week will focus on Thursday’s weekly initial unemployment claims, expected to increase by +29,000 to 220,000.
The markets are discounting a 22% chance that the FOMC will cut the fed funds target range by 25 bp at the January 27-28 FOMC meeting.
Q3 corporate earnings season is drawing to a close as 495 of the 500 S&P companies have released results. According to Bloomberg Intelligence, 83% of reporting S&P 500 companies exceeded forecasts, on course for the best quarter since 2021. Q3 earnings rose +14.6%, more than doubling expectations of +7.2% y/y.
Overseas stock markets settled lower on Wednesday. The Euro Stoxx 50 closed down -0.18%. China’s Shanghai Composite closed down -0.23%. Japan’s Nikkei Stock 225 fell from a 3.5-week high and closed down -0.10%.
Interest Rates
March 10-year T-notes (ZNH6) on Wednesday closed up +4 ticks. The 10-year T-note yield fell -4.1 bp to 4.147%. Mar T-note futures rebounded from a 3-month low on Wednesday and moved higher, and the 10-year T-note yield fell from a 3-month high of 4.207%. T-notes found support after the US Q3 employment index rose less than expected, a dovish factor for Fed policy. T-notes added to their gains after the FOMC cut its 2025 and 2026 US core PCE price estimates and after Fed Chair Powell said that he doesn't think a rate hike is anybody's base case for the Fed's next policy move.
T-notes were initially under pressure early Wednesday amid concerns that a divided FOMC will signal a hawkish rate cut of -25 bp, but then signal policy will remain on hold for an extended period. T-notes also saw some negative carryover from hawkish ECB comments on Wednesday, which pushed the German 10-year bund yield to an 8.75-month high.
European government bond yields are moving higher today. The 10-year German bund yield climbed to an 8.75-month high of 2.895% and finished up by +0.1 bp to 2.851%. The 10-year UK gilt yield rose to a 2.5-week high of 4.554% and is up by +0.1 bp to 4.506%.
ECB President Lagarde said the ECB will likely raise its economic growth forecasts at next week's policy meeting, reflecting a more optimistic outlook.
ECB Governing Council member Simkus said, "We have an inflation rate that is more or less close to the 2% target in the medium term, which suggests no need for a change in interest rates, not only at the next ECB meeting in December but also in further meetings."
Swaps are discounting a 1% chance for a -25 bp rate cut by the ECB at its next policy meeting on December 18.
US Stock Movers
Chip makers rallied on Wednesday, helping lift the broader market. Micron Technology (MU) and Marvell Technology (MRVL) closed up more than +4%, and Applied Materials (AMAT) and Qualcomm (QCOM) closed up more than +3%. Also, Analog Devices (ADI), Broadcom (AVGO), GlobalFoundries (GFS), Lam Research (LRCX), Microchip Technology (MCHP), NXP Semiconductors NV (NXPI), KLA Corp (KLAC), and Texas Instruments (TXN) closed up more than +1%.
Mobile grocery delivery service companies retreated on Wednesday after Amazon.com said it has expanded same-day delivery for perishable groceries to over 2,300 cities and towns, with more coming next year. Maplebear (CART) closed down more than -6% and Uber Technologies (UBER) closed down more than -5% to lead losers in the S&P 500. Also, DoorDash (DASH) closed down more than -4%.
Photronics (PLAB) closed up more than +45% after reporting Q4 adjusted EPS of 60 cents, well above the consensus of 45 cents, and forecasting Q1 adjusted EPS of 51 cents to 59 cents, better than the consensus of 46 cents.
GE Vernova (GEV) closed up more than +15% to lead gainers in the S&P 500 after boosting its stock buyback program to $10 billion and doubling its quarterly dividend to 50 cents.
EchoStar (SATS) closed up more than +10% after Morgan Stanley upgraded the stock to overweight from equal weight with a price target of $110.
Middleby Corp. (MIDD) closed up more than +9% after Jeffries upgraded the stock to buy from hold with a price target of $175.
American International Group (AIG) closed up more than +6% after Insurance Inside reported that Chubb made an informal takeover offer for the company.
PepsiCo (PEP) closed up more than +3% after JPMorgan Chase upgraded the stock to overweight from neutral with a price target of $164.
Waters Corp. (WAT) closed up more than +2% after Wolfe Research upgraded the stock to outperform from peer perform with a price target of $480.
AeroVironment (AVAV) closed down -13% after cutting its 2026 adjusted EPS forecast to $3.40-$3.55 from a previous forecast of $3.60-$3.70, below the consensus of $3.63.
Netflix (NFLX) closed down more than -4% after Paramount said in a letter to Warner Bros. Discovery holders that its offer of $30 per share is superior to Netflix’s offer.
GameStop (GME) closed down more than -4% after reporting Q3 net sales fell -4.6% y/y to $821.0 million.
Noble Corp Plc (NE) closed down more than -2% after JPMorgan Chase downgraded the stock to neutral from overweight.
T Rowe Price Group (TROW) closed down more than 1% after reporting that assets under management in Nov fell -0.2% m/m to $1.79 trillion.
Earnings Reports(12/11/2025)
Broadcom Inc (AVGO), Ciena Corp (CIEN), Costco Wholesale Corp (COST), Lululemon Athletica Inc (LULU), RH (RH).
On the date of publication, Rich Asplund did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Stocks Rally as Fed Cuts Interest Rates and Boosts Liquidity

In the latest trading session, Netflix (NFLX) closed at $92.71, marking a -4.14% move from the previous day. The stock fell short of the S&P 500, which registered a gain of 0.68% for the day. Elsewhere, the Dow saw an upswing of 1.05%, while the tech-heavy Nasdaq appreciated by 0.33%.
Heading into today, shares of the internet video service had lost 14.9% over the past month, lagging the Consumer Discretionary sector's loss of 1.26% and the S&P 500's gain of 1.8%.
Analysts and investors alike will be keeping a close eye on the performance of Netflix in its upcoming earnings disclosure. On that day, Netflix is projected to report earnings of $0.54 per share, which would represent year-over-year growth of 25.58%. Meanwhile, our latest consensus estimate is calling for revenue of $11.97 billion, up 16.78% from the prior-year quarter.
NFLX's full-year Zacks Consensus Estimates are calling for earnings of $2.53 per share and revenue of $45.1 billion. These results would represent year-over-year changes of +27.78% and +15.63%, respectively.
Investors should also pay attention to any latest changes in analyst estimates for Netflix. These revisions typically reflect the latest short-term business trends, which can change frequently. As such, positive estimate revisions reflect analyst optimism about the business and profitability.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To take advantage of this, we've established the Zacks Rank, an exclusive model that considers these estimated changes and delivers an operational rating system.
The Zacks Rank system, ranging from #1 (Strong Buy) to #5 (Strong Sell), possesses a remarkable history of outdoing, externally audited, with #1 stocks returning an average annual gain of +25% since 1988. The Zacks Consensus EPS estimate has moved 0.23% lower within the past month. Netflix currently has a Zacks Rank of #3 (Hold).
With respect to valuation, Netflix is currently being traded at a Forward P/E ratio of 38.25. This signifies a premium in comparison to the average Forward P/E of 15.32 for its industry.
Also, we should mention that NFLX has a PEG ratio of 1.43. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. Broadcast Radio and Television stocks are, on average, holding a PEG ratio of 1.31 based on yesterday's closing prices.
The Broadcast Radio and Television industry is part of the Consumer Discretionary sector. This group has a Zacks Industry Rank of 145, putting it in the bottom 42% of all 250+ industries.
The Zacks Industry Rank evaluates the power of our distinct industry groups by determining the average Zacks Rank of the individual stocks forming the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
You can find more information on all of these metrics, and much more, on Zacks.com.
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Netflix, Inc. (NFLX) : Free Stock Analysis Report
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Netflix (NFLX) Stock Sinks As Market Gains: What You Should Know

(RTTNews) - Paramount, a Skydance Corporation (PSKY) Wednesday sent a letter to the shareholders of Warner Bros. Discovery, Inc. (WBD) stating why Paramount's $30.00 per share all-cash offer to acquire all of WBD is superior to WBD's transaction with Netflix (NFLX).
"Our public offer - identical to the terms we presented to WBD privately - delivers superior value and a faster, more certain path to completion than the transaction announced with Netflix. It Is Not Too Late To Realize The Benefits Of Paramount's Proposal If You Choose To Act Now And Tender Your Shares," the company said in the letter.
The company added that its offer is financially superior to Netflix's transaction, which provides WBD shareholders with lower value, less cash and significantly less certainty. On its face, Netflix is offering WBD shareholders $23.25 per share in cash, $4.50 in stock and a share in WBD's Global Networks spin-off. In reality, however, the total value is materially lower than advertised.
The company also noted that its offer is not subject to any financing conditions and will be financed by $41 billion of new equity backstopped by the Ellison family and RedBird Capital and $54 billion of debt commitments from Bank of America, Citi and Apollo.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Index	Bulls	Bears
Confidence
Support
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	S/L 5%RUB 97.35	S/L 10%RUB 101.98	S/L 15%RUB 106.62
Day	16.93%	0.11%	0.00%
Week	53.88%	14.56%	2.39%
Month	76.42%	47.76%	27.04%

Netflix, Inc.

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