Investors are on the lookout for quality stocks to own amidst fears that Trump’s trade policies will push the US economy into a recession in the back half of 2025.
While their search criteria is unlikely to include consumer discretionary names, given their history of underperforming during economic slowdowns, there’s one that could keep its own this year.
Enter Netflix Inc (NASDAQ: NFLX).
The streaming giant has an incredible subscription model that will likely remain solid amidst the macro uncertainty coming out of the White House, according to famed investor Jim Cramer.
Netflix has historically done well amidst downturns
Netflix has historically fared well during economic downturns. Even the great financial crisis or the COVID pandemic couldn’t push it into underperformance.
This year as well, the streaming behemoth is doing better than the majority of its tech peers amidst Trump tariffs and the related fears of a recession ahead.
That’s because NFLX is a great subscription service and “once people get locked to a great service, they almost never go for cancelling,” Cramer told his audience on Mad Money last night.
The former hedge fund manager is convinced that Americans will stick with Netflix even if the economy slides into a recession as it offers affordable means of entertainment, which makes it suitable for times when consumers tend to avoid pricier alternatives.
Technicals signal further upside in NFLX shares
Jim Cramer is keeping bullish on Netflix stock amidst economic uncertainty also because its chart is indicating further upside ahead.
The streaming giant has recovered more than 10% in recent sessions and that too on strong volume, which makes it “a move that’s telling the truth”.
Note that technical indicators are also pointing upwards. NFLX shares’ MACD has “recently made a bullish crossover” and the Chaikin Money Flow is “slightly bullish” at the time of writing as well, he added.
That said, Netflix Inc does not currently pay a dividend to appear even more attractive ahead of a potential recession.
Should you buy Netflix stock at current levels?
Cramer is certainly not alone in keeping positive on Netflix shares despite fears of an economic downturn. MoffettNathanson analysts also upgraded the mass media giant last week.
The investment firm now rates the Nasdaq-listed firm at “buy” and sees upside in it to $1,100 that translates to about a 15% upside from current levels.
MoffettNathanson turned bullish on NFLX stock primarily because “it has won the streaming wars” according to its research note on March 18th that added “engagement will allow the company to better monetise and unlock greater profits in the years ahead.”
While Netflix stock has recovered in recent days, it’s still down about 9.0% versus its recent high, indicating it’s not yet too late for investors to buy NFLX on the dip.
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