As the first trading month of the year kicks off, history suggests investors could be in for a bullish ride.
January has historically been a positive month for the S&P 500, while one streaming giant has repeatedly delivered astonishing gains.
Could this January follow suit? Let's break down the numbers.
S&P 500: A New Year's Tradition Of Gains
The S&P 500 index — tracked by the SPDR S&P 500 ETF Trust SPY — has a long history of positive performance in January, chalking up gains in 58 of the past 97 years and marking a solid win rate of about 60%.
According to Seasonax data, the index boasts an average return of 1.12% and a median return of 1.62% in the first month of the year.
The best January on record came in 1988, when the index skyrocketed 12.17%, while the worst January hit during the Great Recession in 2009, with a sharp loss of -11.41%.
Despite occasional setbacks, the odds have historically tilted in favor of gains as the calendar turns to the new year.
Netflix's January Blockbuster: The Stock To Watch This Month
While the S&P 500 delivers steady gains, Netflix Inc. NFLX has a tendency to steal the spotlight in January. Over the past 20 years, the streaming giant has delivered positive returns in 15 out of 20 Januaries, boasting an average return of 12.64% and a median return of 13.47%.
The trigger for this stellar performance? Its fourth-quarter earnings release, typically announced in the second half of January. Netflix's fourt-quarter numbers often set the tone for the stock, and the reaction is anything but subtle.
In January 2024, shares of Netflix surged by 10.7% following the release of its fourth-quarter earnings, continuing a pattern seen in previous years. Back in 2023, the stock jumped 8.46% after earnings, while in 2021, the post-earnings rally was even more dramatic, with Netflix soaring by a whopping 16.85%.
Netflix’s best January on record came in 2013 when the stock soared by nearly 80%. On the other hand, the company's worst January occurred in 2022, when Netflix shares plummeted by -28.5%.
For January 2025, the company will report its fourth-quarter 2024 earnings on Jan. 21.
Netflix's January Returns: A Two-Decade Snapshot
| Start Date | End Date | Profit % |
|---|---|---|
| Jan. 3, 2005 | Jan. 31, 2005 | -3.52% |
| Jan. 3, 2006 | Jan. 31, 2006 | +5.76% |
| Jan. 3, 2007 | Jan. 31, 2007 | -14.28% |
| Jan. 2, 2008 | Jan. 31, 2008 | -4.55% |
| Jan. 2, 2009 | Feb. 2, 2009 | +23.70% |
| Jan. 4, 2010 | Feb. 1, 2010 | +14.12% |
| Jan. 3, 2011 | Jan. 31, 2011 | +19.99% |
| Jan. 3, 2012 | Jan. 31, 2012 | +66.39% |
| Jan. 2, 2013 | Jan. 31, 2013 | +79.59% |
| Jan. 2, 2014 | Jan. 31, 2014 | +12.82% |
| Jan. 2, 2015 | Feb. 2, 2015 | +26.40% |
| Jan. 4, 2016 | Feb. 1, 2016 | -14.43% |
| Jan. 3, 2017 | Jan. 31, 2017 | +10.37% |
| Jan. 2, 2018 | Jan. 31, 2018 | +34.43% |
| Jan. 2, 2019 | Jan. 31, 2019 | +26.84% |
| Jan. 2, 2020 | Jan. 31, 2020 | +4.63% |
| Jan. 4, 2021 | Feb. 1, 2021 | +3.09% |
| Jan. 3, 2022 | Jan. 31, 2022 | -28.50% |
| Jan. 3, 2023 | Jan. 31, 2023 | +19.97% |
| Jan. 2, 2024 | Jan. 31, 2024 | +20.41% |
| Average: +12.64% |
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