Netflix Pops on Long-Anticipated 10-for-1 Stock Split: Why This Growth Stock Is a Great Buy in November

Core Viewpoint - Netflix is set to conduct a 10-for-1 stock split, which is expected to enhance stock accessibility and potentially drive further stock price increases, making it an attractive investment opportunity this month [1][2][5]. Stock Split Details - Netflix will increase its outstanding shares from approximately 423.73 million to 4.23 billion, reducing the stock price from about $1,136 to approximately $113 per share [4]. - The stock split is anticipated to remove the psychological barrier of a high stock price and make shares more accessible to employees participating in stock option programs [5]. Historical Context and Market Reaction - The upcoming stock split will be Netflix's first since 2015, during which the stock has significantly appreciated, indicating strong underlying performance [6]. - Historically, companies that conduct stock splits see an average stock price increase of 25% in the year following the announcement, which is notably higher than the S&P 500's average gain of 12% [7]. Content and Subscriber Growth - Netflix's upcoming release of the final season of "Stranger Things" is expected to drive subscriber growth, similar to the surge seen with previous seasons [8][9]. - The company has also garnered attention with other popular content releases, enhancing its value proposition to subscribers [11]. Financial Performance and Projections - Netflix's stock currently trades at 35 times next year's expected earnings, reflecting a premium valuation [12]. - Analysts project an average revenue growth of 11% for Netflix over the next five fiscal years, supported by its ability to attract and retain viewers [13]. - Management aims to increase the company's market cap to $1 trillion by 2030, more than double its current valuation [14].