By Jeran Wittenstein and Bailey Lipschultz

Photographer: Ethan Swope/Bloomberg

(Bloomberg) -- Skepticism surrounding Netflix Inc.’s proposed acquisition of Warner Bros. Discovery Inc. triggered a $40 billion wipeout in the company’s market value in just six sessions. To retail traders, that’s a screaming buy signal.

Amateur investors have been snapping up shares of the streaming giant even as it dropped 15% from Dec. 2 to Dec. 10, its worst six-session losing streak since May 2022, while Wall Street weighs the implications of a protracted bidding war. Netflix was the third most active stock on Interactive Brokers’ platform for the week ending Monday.

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As the shares recover somewhat Thursday with a gain of as much as 2.3%, the retail crowd is staying in the game. On Fidelity’s platform, buy orders outpaced sell orders at a greater than three-to-one clip, while data from JPMorgan Chase & Co. flashed strong retail buying power.

“Our customers do show a tendency to try to buy dips in names that they feel are likely to recover,” said Steve Sosnick, chief strategist at Interactive Brokers. The combination of the Warner Bros. deal, volatility and the share decline “is why we really saw it leap into prominence.”

Netflix shares have lost 23% over the past two months, as concerns about its outlook for revenue growth are compounded by the risks of its pursuit of Warner Bros. Paramount Skydance Corp.’s $108 billion hostile bid for the HBO owner and the involvement of President Donald Trump have only added to the unease, raising the specter of a bidding war and potential opposition from regulators.