Is Netflix Stock Cheap or Overvalued? Here's What Investors Need to Know.

Is Netflix Stock Cheap or Overvalued? Here's What Investors Need to Know. Neil Patel, The Motley Fool Sat, June 20, 2026 at 11:49 PM GMT+2 2 min read NFLX NVDA ^GSPC Since it's a category-creating enterprise known for its innovative and disruptive identity, it's no surprise that Netflix (NASDAQ: NFLX) has been a huge winner.

Despite shares currently trading 42% below their all-time high from June 2025 (as of June 18), they have still climbed 715% in the past decade. Is the leading streaming stock cheap or overvalued today? Here's what investors need to know.

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 For the first time in years, that same "Total Conviction" signal is flashing for a company 1/100th the size of Nvidia.   Continue » Image source: The Motley Fool. Netflix shares now trade at a price-to-earnings (P/E) ratio of 24.

9. This multiple has come down significantly. The stock's valuation is in line with the broader S&P 500 index.

Investors might be ready to pounce at this opportunity to own an industry-leading company at a P/E ratio that looks compelling. The analysis should also consider the competitive landscape. Competition for eyeballs and attention has never been this intense.

Whether it's Alphabet 's YouTube capturing more share of TV viewing time or Meta Platforms ' Instagram taking up smartphone screens, it's becoming a bigger challenge for Netflix to stand out in a sea of entertainment options. It's likely that the company's growth will slow going forward, as it now has more than 325 million subscribers. What's more, content costs should keep rising, especially as Netflix makes more of an effort to acquire rights to certain live events and sports .

I don't think Netflix stock is cheap or expensive. It looks fairly valued right now after its 42% drop. Should you buy stock in Netflix right now?

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Neil Patel has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Alphabet, Meta Platforms, and Netflix. The Motley Fool has a disclosure policy .

Is Netflix Stock Cheap or Overvalued? Here's What Investors Need to Know.