NFLX

Netflix stock rose 3.09% on Oct. 22 as investors bought the dip following a sharp post-earnings sell-off. The company reported stronger-than-expected Q3 EPS and operating margins, but disappointed with softer Q4 guidance and reduced 2026 ad revenue targets. Netflix's aggressive capital return program, including a record $4.8 billion stock buyback, supported investor confidence despite broader market weakness.

Cathie Wood's Ark Invest added to positions in Netflix, Oklo, and Intuitive Surgical on Wednesday, all of which have declined significantly over the past year. Netflix hit a two-year low after disappointing guidance, Oklo has surrendered 86% from its peak despite promising nuclear technology, and Intuitive Surgical faces competitive threats but maintains strong earnings beats.

Netflix stock has declined 27% in 2026, approaching its worst year since 2022, despite strong business fundamentals. The company reported Q3 revenue growth of 12% to $12.9 billion and operating income up 37%, with an operating margin of 34.6%.

However, revenue growth is decelerating and the company cut its 2026 ad revenue guidance from $3 billion to $2.7 billion. At a P/E ratio of 17-18, Netflix trades in line with the S&P 500 despite double-digit revenue growth and a 35% operating margin, making it worth considering for long-term investors willing to build positions gradually.