Alright, Netflix did a 10-for-1 stock split. Big deal. Shares were trading above $1,100, now they're gonna be around $113. So what?
Everyone's buzzing about "potential short-term gains." Investors are supposedly hyped. Give me a break. Stock splits draw in retail investors? Maybe. Boost liquidity? Probably. Short-term price increases? Possibly... until reality hits.
It's like when your landlord paints over the mold in your apartment instead of fixing the leak. Sure, it looks better for a week, but the problem is still there, festering under the surface. This stock split feels like the same kind of Band-Aid solution.
Bank of America says companies that announce splits average 25% gains in the following year, double the S&P 500's typical return. Okay, BoA. But correlation ain't causation. Are these companies fundamentally better, or are they just getting a temporary sugar rush from the split announcement? And what happens when the sugar crash comes?
Netflix's last stock split was in 2015, and shares rose significantly after that. But 2015 was a completely different world. Streaming wasn't the battlefield it is today. So, comparing then and now is like comparing apples to, well, streaming services... wait, bad analogy.
And let's be real, this ain't about making the stock "more accessible" to the average Joe. It's about juicing the price to keep the executives happy.
Netflix shares already tumbled almost 9% after their Q3 earnings report. Ouch. Q3 revenue grew 17.2% year-over-year, and Q4 is projected at 16.7%. That sounds good, right? Except, is it good enough? Are they still growing like they used to? Nope.
They're trying to distract us with "Stranger Things" coming back. The final season is being released in phases, from later this month through December 31. Okay, cool. But will that be enough to stop people from noticing that the writing quality has dipped lower than my tolerance for reality TV? I doubt it.
Non-U.S. regions contribute over half of Netflix's total revenue. Good for them. But even that growth is uneven. U.S. and Canada grew 9%, while Latin America and Asia-Pacific soared 27% and 26%, respectively. So, they're relying on international markets to pick up the slack. What happens when that growth slows down?
Here's the thing: Netflix was founded in 1997 and had its IPO in 2002 at $15 a share. They've had a good run, sure. But are they innovating, or just desperately clinging to their past glory?
Details on why the decision was made remain scarce... offcourse. What do they expect us to believe? That they're doing this out of the goodness of their hearts? Please.
Netflix's stock split is a shiny object meant to distract from the real issues. They're hoping to trick the market into thinking everything is fine, but let's be real, they ain't fooling anyone with half a brain.
