Why Netflix Could Be a Safe Harbor in a Market Downturn
When the stock market is falling, investors naturally gravitate toward companies perceived as safer than the rest -- frequently utilities, energy, and consumer staples. However, when the coronavirus pandemic hit, many fled toward certain large-cap tech stocks. With another drop in the making, is Netflix (NASDAQ: NFLX) a solid safe harbor? Or will a recession cause this FAANG stock to fall hard, too?
Perhaps because of all our time at home these past months, record numbers of consumers have signed up for Netflix in 2020. This might not be a surprise, given the company's aggressive efforts to expand its market. Yet the real shocker lay in where Netflix saw a jump: Netflix had supposedly saturated the market in the U.S. and Canada, leading to naturally slowing subscriber growth rates, but in the first half of 2020, net subscriber additions in the region surged 200% compared to the prior-year period.
Source Fool.com
