As Netflix Stock Loses Steam, Should You Buy the NFLX Dip?

After a powerful run that saw Netflix (NFLX) stock outpace the broader market, shares of the streaming giant are losing steam. NFLX stock has slipped 17.6% from its recent peak of $1,341.15, and more than 12% since it posted third-quarter results on Oct. 21.

In its latest quarter, Netflix continued to show impressive revenue growth, maintaining its double-digit pace. However, the bottom line was lower than expected. The company reported earnings of $5.87 per share, falling short of Wall Street’s $6.89 estimate and its own guidance of $6.87. The earnings miss was largely attributed to unexpected expenses tied to a tax dispute in Brazil. The increased costs related to the tax dispute squeezed Netflix’s operating margin, taking a noticeable bite out of its profits.