Netflix Stock: A Lucrative Investment Since the “Love is Sharing a Password” Tweet
WHAT YOU SHOULD KNOW
- A $1,000 investment in Netflix six years ago would be worth $2,643.26 today.
- Netflix is cracking down on password sharing to boost revenue.
- The company has been a strong performer in the market, outperforming the S&P 500 ETF Trust.
Investing in a company is always a risk, but for those who invested in Netflix six years ago, when the company tweeted that “love is sharing a password,” it has paid off. A $1,000 investment in Netflix (NFLX) on March 10, 2017, when the tweet was posted, would be worth $2,643.26 today, based on the current price of $374.93 per share. This represents a return of 164.3% or an average annual return of 27.4%.
Netflix has been growing rapidly, ending the fourth quarter of 2022 with 230.75 million paid subscribers and adding 7.7 million in the most recent quarter. The company is looking for ways to continue its growth, which is why it recently launched an ad-tier platform and is cracking down on password sharing.
The new policy of cracking down on password sharing has been met with criticism on social media, as many remember the 2017 tweet that “love is sharing a password.” Despite the complaint, the company believes it is necessary to boost revenue in the highly competitive streaming market without raising the costs of monthly plans.
For comparison, the S&P 500 ETF Trust (SPY) is up 74.9% over the same period, making Netflix a strong performer in the market. The big question is whether Netflix will continue outperforming the market after the password crackdown.
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