Netflix (NFLX) shares are falling on Wednesday after regulatory filings revealed that Reed Hastings has offloaded more than 375,000 Netflix shares.
On December 1, the co-founder and current president of the media giant sold 375,470 shares of NFLX. However, it appears that through a prearranged 10b5-1 trading plan, Hastings simply sold shares that were converted on the same day of the transaction.
Netflix stock is currently down 22% from its June high. This morning’s sell-off pushed it below its 20-day moving average (MA) at $109.47, indicating continued bearish momentum in the near term.
Hastings’ move, while alarming on the surface, is not particularly concerning for NFLX stock.
Because? Because the sale was made through a pre-established 10b5-1 business plan adopted in 2023. Additionally, through the Hastings-Quillin Family Trust, he continues to control more than 21 million shares of Netflix.
This indirect ownership underscores his continued commitment to the Nasdaq-listed company.
Ultimately, the transaction does not reflect a loss of confidence, but rather routine portfolio management or personal liquidity planning.
While Hastings’ presentation may not justify selling Netflix shares, the technicals suggest otherwise.
The streaming giant is currently trading decisively below its main moving averages (50 days, 100 days, 200 days), indicating that the broader trend remains undeniably bearish.
Additionally, NFLX has its 100-day Relative Strength Index (RSI) at nearly 48 currently, reinforcing that the downside momentum is nowhere near running out yet.
According to Barchart, the options price also suggests that Media shares could fall to around $91 or another 12% from current levels through the end of February.
As for valuation, Netflix currently trades at a forward price-to-earnings (P/E) ratio of about 43 times, which even eclipses the multiple of top AI stocks like Nvidia (NVDA).
However, despite the aforementioned risks, Wall Street remains bullish on Netflix, believing that its dominance in the streaming space will drive its stock price higher in 2026.