After Abandoning the WBD Bid, These Catalysts May Drive Netflix Stock Higher

Shares of entertainment giant Netflix NFLX +13.77% ▲ have fallen sharply in recent months, mainly because investors were worried about the company’s proposed $82.7 billion purchase of Warner Bros. Discovery WBD -2.19% ▼ . Even though Netflix’s core business is strong, the market feared that the deal would force the company to take on more than $40 billion in new debt. It also caused the firm to pause its stock buyback program in order to preserve cash.

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And because buybacks helped create demand for shares, this pause added to the downward pressure. On top of that, Netflix had issued cautious guidance for 2026 that indicated slower revenue growth and higher near-term costs due to heavy content spending. As a result, the stock dropped by about 40% below its all-time high at one point.

However, the situation changed on February 26, 2026, when Netflix announced that it would abandon the acquisition after a higher offer from media company Paramount Skydance PSKY +20.84% ▲ appeared. Investors saw this as a sign that management was prioritizing financial stability, and the stock surged as a result. Now, with the acquisition drama behind the firm, several catalysts may help push Netflix stock higher.

Netflix Catalysts

First, buybacks are expected to resume now that the acquisition is off the table, which will increase the demand for shares. Second, Netflix’s advertising business is growing quickly, with revenue projected to double to about $3 billion in 2026. At the same time, the company is expanding into live sports, including MLB events, NFL Christmas Day games, and Formula 1 coverage, to keep viewers engaged and reduce cancellations. In addition, Netflix is working on cloud gaming and developing a major soccer title that is planned to be released ahead of the 2026 World Cup.

Netflix Risks

However, like all investments, there are always risks to consider. For instance, content spending is expected to stay extremely high at around $18 billion to $20 billion as Netflix invests heavily in sports rights and gaming. Meanwhile, competition could intensify, especially if the PSKY-WBD merger closes and other rival media companies continue to merge into larger streaming platforms.

Nevertheless, by walking away from the debt-heavy acquisition, the company has removed a major concern for investors. As a result, attention is now shifting back to whether Netflix can continue growing on its own while managing rising costs in an increasingly crowded streaming market.

Is Netflix a Good Stock to Buy Now?

Turning to Wall Street, analysts have a Moderate Buy consensus rating on NFLX stock based on 28 Buys, eight Holds, and one Sell assigned in the past three months, as indicated by the graphic below. Furthermore, the average NFLX price target of $114.55 per share implies 19% upside potential.

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