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Here's How Much Investing $1,000 In Netflix When Blockbuster Went Bankrupt Would Be Worth Today

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Here's How Much Investing $1,000 In Netflix When Blockbuster Went Bankrupt Would Be Worth Today

Investors who owned stocks in the 2010s generally experienced some big gains. In fact, the SPDR S&P 500 (NYSE: SPY) total return since Sept. 23, 2010 is 276.8%.

On that day in history, movie rental giant Blockbuster officially declared bankruptcy, officially marking the changing of the guard in video entertainment to Netflix, Inc. (NASDAQ: NFLX)

Netflix’s Big Decade: Since Blockbuster’s demise, Netflix has been one of the top performers in the entire stock market.

Netflix is the most successful streaming video service in the world. As of September 2020, Netflix had 168.9 million over-the-top video service viewers, much more than leading competitors such as Amazon.com, Inc. (NASDAQ: AMZN) Prime Video (130.1 million) and Hulu (94.5 million).

In the video entertainment world, if the 2000s were defined by a shift from a DVD rental model to a streaming model, the 2010s were defined by Netflix’s heavy investments in original content and international expansion.

Netflix issued a seven-to-one stock split back in 2015, so all the prices mentioned below are on split-adjusted terms.

Incredibly, Netflix shares started the 2010s trading at around $7.64, near its low point for the decade. After surging as high as $43.54 by mid-2011, Netflix shares tanked on concerns about the company’s heavy investments and lack of profitability. Netflix once again tested its decade lows in 2012, dropping as low as $7.54.

From that point forward, it was a slow and steady climb for the next seven years with few interruptions.

2020 And Beyond: Netflix reached its high point of the 2010s in mid-2018 at $423.21.

However, the stock has been a big winner during the COVID-19 crisis, reaching a new all-time high of $575.37 earlier this year.

In fact, $1,000 worth of Netflix stock purchased on the day Blockbuster declared bankruptcy back in 2010 would be worth more than $23,100 today.

Looking ahead, analysts expect more upside from Netflix in the next 12 months. The average price target among the 38 analysts covering the stock is $570, suggesting 7.4% upside from current levels.

Those gains could start as soon as Tuesday afternoon when Netflix reports third-quarter earnings.

Photo by cottonbro from Pexels

 

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