Netflix Stock Drops 6.5% This Week Amid Warner Bros Acquisition Battle and AI Concerns
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Netflix Stock Drops 6.5% This Week Amid Warner Bros Acquisition Battle and AI Concerns
"The consensus rating sits at "Moderate Buy" with 30 buy or strong buy ratings against 14 holds or sells. The average analyst target of $111.43 implies 45% upside. The technical setup supports a contrarian case. The RSI hit 26.8, deep into oversold territory, while the Schaeffer's Volatility Index sits in the 8th percentile, suggesting excessive bearishness. Options traders are building put positions at the $80 strike, but max pain sits at $90, indicating potential upside if sentiment stabilizes."
"Netflix's $82.7 billion all-cash offer for Warner Bros Discovery ( NASDAQ:WBD) faces serious headwinds. Activist investor Ancora Holdings, holding a $200 million stake, is pushing Warner's board to reject Netflix in favor of Paramount Global ( NASDAQ:PARA) Skydance's competing bid. Paramount sweetened its offer on February 10, adding a "ticking fee" of 25 cents per share per quarter if the deal doesn't close by year end and pledging to cover Warner's $2.8 billion breakup fee to Netflix. The tender deadline was extended to March 2."
Netflix shares fell to $76.87, down 6.48% over the week and 18% year to date, trading near a 52-week low of $79. Wall Street consensus remains Moderate Buy with 30 buy or strong buy ratings versus 14 holds or sells and an average analyst target of $111.43, implying roughly 45% upside. Technical indicators show the RSI at 26.8 and Schaeffer's Volatility Index in the 8th percentile, with options activity concentrated at the $80 put strike and max pain at $90. Q4 2025 revenue rose 17.6% year over year, operating margins reached 29.5%, and last-quarter free cash flow was $2.66 billion. Netflix's $82.7 billion all-cash offer for Warner Bros Discovery faces competing bids, activist pressure, a tender extension to March 2, and investor concerns about leverage.
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