Netflix’s stock is down 9% at the start of 2026 due to concerns over its bid to buy Warner Bros. The company projects revenue growth between 12% and 14% this year, down from 16% in 2025. Despite strong earnings, the stock’s high valuation with a P/E ratio of 34 is worrying investors. Netflix’s growth rate for 2026 is expected to slow, with the company forecasting ad revenue to double. Investors may be adjusting their expectations, anticipating a potential decline in the stock price in the near future.

Netflix’s revenue for Q4 2025 was $12.1 billion, up 18% year over year. However, the company’s full-year growth rate was 16%, which may have led to concerns about the stock’s future performance. Looking ahead, Netflix anticipates a growth rate between 12% and 14% for 2026, signaling a slowdown. With a premium valuation and underwhelming guidance, the stock may face further decline.

Investors should consider the risks before buying Netflix stock, as the company’s high valuation and projected growth rate for 2026 may lead to increased volatility. The Motley Fool’s Stock Advisor team has identified 10 other stocks for investors to consider, which may offer better returns in the long term.

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