Netflix, which has been the best performer in the S&P 500 Index this year, was among the media stocks that have declined the most since October. The streaming firm closed down 7.8% at $112.55, which is the biggest one-day decline since Oct. 16, 2014.

Netflix, Inc. A Good Buy As It Enters Correction Phase

An opportunity for investors

On Thursday, media firms were among the biggest losers in the S&P 500. Apart from Netflix, veteran firms like Disney, CBS, Viacom and Time Warner were all down more than 5%. The sharp decline follows a sector downgrade by Sanford C. Bernstein analyst Todd Juenger, who noted that subscriber fees and advertising sales are in danger as the pay-TV industry loses viewers.

“We believe the U.S. television industry is entering a period of prolonged structural decline, caused by a migration of viewers from ad-supported platforms to non-ad-supported, or less-ad-supported platforms,” Juenger said.

Changes in consumer behavior can be noticed with regard to the media sector, says BTIG analyst Rich Greenfield. There is a growing perception in the market that the traditional media companies are not prepared, the analyst said. Despite the broader market decline, Greenfield is bullish on Netflix, saying, “This is your opportunity to buy it on a dip.”

Correction in Netflix stock

Until Thursday, Netflix was largely untouched with the decline in entertainment stocks, which was triggered on Aug. 5 after Disney lowered its earnings forecast at its ESPN sports network. The Thursday drop shaved off more than $4 billion in the streaming firm’s market cap.

Netflix stock has been rallying after it delivered better-than-expected numbers for the second quarter on July 15. The streaming firm ended the quarter with 65.55 million subscribers, including 42.3 million in the U.S. and 23.25 million internationally. For the third quarter, the company expects to add 3.55 million new users, including 1.15 million in the U.S. and 2.4 million elsewhere. Netflix aims to complete its global expansion by next year. In Japan, the streaming firm will launch its services in September, while by the fourth quarter, it will be available in Portugal and Spain.

Since the Aug. 6 record close, the stock has now lost 11% of its value, which could be seen as its second significant correction after its late-2014 bear market. Year to date, Netflix shares are up by over 120%.