👉 The Investing Week Ahead: Netflix, Tesla, Visa

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What We’re Watching:

The most recent Netflix earnings report saw a boost in subscriber growth due to finally cracking down on password sharing (and profiting from it). The company also raised their prices for Basic and Premium plans. 8.6 million net new global subscribers during Q3 SMASHED estimates of 5.49 million.

Eager to see what’s in store for Q4.

The message was heard loud and clear in Tesla’s most recent earnings report — they want to make their cars as affordable as possible. Tesla’s mission is absolutely not becoming the most expensive EV in the game. Their goal has always been to reach economies of scale and be the default option for EV buyers — causing frustration with competitors that have yet to adequately scale.

Tesla reminds me of the “printer” industry — essentially lose money on the printer, but make it up on the ink. Tesla is “giving away” their cars, then making it up with various software updates and purchases like FSD.

Analysts will be keeping an eye on revenue and adjusted EPS, both of which missed in the last quarter ($23.35 billion vs $24.1 billion & 66 cents vs 73 cents, respectively).

Visa’s most recent earnings report included a +9% increase in payments volume (above) and a +10% increase in processed transactions. Incredibly — cross-border volume excluding transactions within Europe increased +18% for Q4 and +25% for the full fiscal year.

Analysts will be keeping an eye on another potential dividend increase, and are eager to hear more about Visa’s global expansion plans as the stock is at all-time-highs.

What We’re Watching:

“Despite the overall decline, six out of ten leading indicators made positive contributions to the LEI in December. Nonetheless, these improvements were more than offset by weak conditions in manufacturing, the high interest-rate environment, and low consumer confidence. As the magnitude of monthly declines has lessened, the LEI’s six-month and twelve-month growth rates have turned upward but remain negative, continuing to signal the risk of recession ahead. Overall, we expect GDP growth to turn negative in Q2 and Q3 of 2024 but begin to recover late in the year.” — Justyna Zabinska-La Monica, Senior Manager at The Conference Board

As you can see above, the manufacturing industry in the United States was littered with contraction in 2023. We’re eager to see if there’s a turnaround underway in 2024.