Netflix Inc (NASDAQ: NFLX) tanked below its 200-day moving average this week – triggering concerns among technical traders.
But widely followed investor, Josh Brown, remains constructive on the streamer for the long-term.
NFLX reported in-line revenue and lower-than-expected earnings for its fiscal third quarter due to a Brazilian tax dispute, which resulted in five consecutive sessions of stock price decline.
Versus its year-to-date high, Netflix stock is now down a little under 20% – which Brown dubbed an exciting opportunity for long-term investors in a recent segment of CNBC.
Why Josh Brown is bullish on Netflix stock
Ritholtz’ chief executive Josh Brown isn’t fazed by the technical breakdown – in fact, he’s leaning in.
Brown has added to his NFLX stock position on the post-earnings plunge. “I think the buyers will show up here as they have in the past,” he said – adding that any move below the 200-day MA is likely “very temporary.”
Brown views Netflix as one of the “five most important technology platforms in existence,” citing its robust content pipeline and expanding ad revenue as catalysts for future growth.
For investors committed to holding them for the long-term, he argued, Netflix shares on the post-earnings dip offer a compelling entry point.
What history tells us about NFLX shares’ plunge
Technical purists may balk at a breach of the 200-day moving average, but NFLX shares’ history tells a more nuanced story.
When the stock has closed below this level after maintaining a position above it for at least 100 consecutive days, forward returns have often been positive.
Over the past 12 years, this setup has occurred seven times. In five of those instances, Netflix stock posted gains over the following six months; in four, it rose over the next year.
On average, the streaming giant delivered a 17% return six months after such a dip, and a 25% gain after 12 months.
These stats suggest that while the technical signal may appear bearish, it has often preceded strong recovery in the mass media and entertainment conglomerate.
How to play Netflix Inc heading into 2026
While short-term traders may interpret the 200-day breach as a warning, seasoned investors like Brown and Paul Meeks of Freedom Capital Markets see it as a buying opportunity.
Meeks recently told CNBC he’d “buy it with both hands” if Netflix shares dipped below the key technical level.
With fundamentals still intact and historical data favoring rebounds, the current weakness may be less a breakdown and more a reset.
For those willing to look past the charts and focus on platform dominance, monetization potential, and content strength, NFLX stock’s recent stumble could be the setup for its next leg higher.
Note that Wall Street analysts also currently have a consensus “overweight” rating on Netflix Inc.
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