🎉 Netflix beats

and Trump creates excitement

In partnership with

Good morning investors! The market yesterday did well and investors appear to be preparing for another Trump rally.

Today we cover:

  • Trump to proceed cautiously on tariffs

  • Netflix beats

  • United Airlines reports earnings

📊 Economy and News 

Wall Street Reacts to Trump’s First-Day Trade Comments

Donald Trump Dancing GIF by PBS News

Gif by pbsnewshour on Giphy

Wall Street responded cautiously to President Donald Trump’s initial remarks and actions on international trade during his first day back in office. While Trump hinted at potential 25% tariffs on Mexico and Canada due to their border policies, he stopped short of enacting new trade levies, signaling a less aggressive stance than some had anticipated.

In a White House ceremony Monday night, Trump signed a series of executive orders, including a directive for federal agencies to review what he described as unfair trade practices by foreign nations. However, his comments about tariffs on China were notably vague, tied to the country’s handling of a proposed TikTok deal. Trump also clarified that he wasn’t ready to implement universal tariffs at this stage.

Investors viewed the lack of immediate tariff action as a softer approach than expected, which tempered fears of a rapid escalation in trade tensions.

Among his first moves, Trump declared a national energy emergency, aimed at boosting fossil fuel production to address what he called an “energy crisis.”

Global hits:

Good to know: FTC sues PepsiCo, alleging price discrimination is raising costs for consumers. Also, space stocks surged after Trump inauguration with ‘broad excitement’ about sector. However, Apple had a bad day thanks to two downgrades.

Something about the UK: UK wages have risen at their fastest pace in over three years, with average pay increasing 5.6% in the three months to November, up from 5.2% in the prior quarter. Adjusted for inflation, real pay grew 2.5%, the highest since 2021, and 3.4% when excluding housing costs.

However, employment trends tell a different story. Payrolled jobs fell by 47,000 in December to 30.3 million, the steepest decline since the pandemic, following Labour's payroll tax hike. Job vacancies also dropped to 740,000 in December from 858,000 in October, while the unemployment rate edged up to 4.4%.

Despite concerns about rising wages fueling inflation, the Bank of England is expected to cut interest rates next month. Balancing wage growth with employment stability remains a key challenge for policymakers.

Sponsored by Wallstreet Prep

From Wall Street to Your Portfolio: Master Value Investing

The Applied Value Investing Certificate Program from Wharton Online and Wall Street Prep is an 8-week, online, self-paced program that teaches participants how to identify undervalued stocks with the process-driven approach used by the world’s top investors.

Program benefits also include:

  • Guest Speaker Series with top industry professionals

  • Exclusive access to networking and recruitment events

  • Invitation-Only LinkedIn Groups and Slack Channels

  • Certificate issued by Wharton Online and Wall Street Prep

📈 Stocks

S&P 500 6,049.24 (+0.88%)
DJIA 44,025.81 (+1.24%)
NASDAQ 19,756.78 (+0.64%)
BRENT CRUDE 79.23 (-1.07%)
* Prices as of Jan 22nd, 12:20 AM UTC

Netflix reports earnings, jumps higher

Netflix shares jumped over 14% after the company reported fourth-quarter results that exceeded expectations.

The company added 19 million subscribers in the quarter, bringing paid memberships to a record 301.6 million, surpassing Wall Street estimates of 290.9 million. Including “extra member accounts.” Netflix estimates its global audience exceeds 700 million.

Financial Highlights

  • Earnings per share: $4.27 vs. $4.20 expected

  • Revenue: $10.25 billion vs. $10.11 billion expected

  • Net income: $1.87 billion, up from $938 million a year earlier

Revenue rose 16% year-over-year. For 2025, Netflix raised its revenue forecast to $43.5–$44.5 billion, reflecting improved business fundamentals.

Strategic Shifts and Future Plans

Starting in 2025, Netflix will replace quarterly subscriber counts with bi-annual “engagement reports.” The company is also focusing on expanding its ad-supported tiers, which now account for over 55% of sign-ups in eligible regions and saw 30% quarter-over-quarter growth.

The company is also delving deeper into live sports, games, and other entertainment formats to boost engagement.

More importantly, Netflix is increasing the cost of its streaming plans in the U.S., including the cheaper, ad-supported tier. The company said it will also hike most of its membership plans in Canada, Portugal and Argentina.

United beats: United Airlines exceeded Wall Street expectations for the fourth quarter, reporting adjusted earnings per share of $3.26 versus the expected $3.00 and revenue of $14.70 billion, above the $14.47 billion forecast. The airline’s profit surged 64% year-over-year to $985 million, driven by an 8% revenue increase.

United’s stock has soared over 180% in the past year, more than any other U.S. carrier, and rose another 3% in extended trading after the results. For the first quarter of 2025, United expects adjusted earnings of $0.75 to $1.25 per share, surpassing analyst estimates of $0.54. Full-year earnings are projected at $11.50 to $13.50, aligning with Wall Street's expectations.

The airline benefited from strong demand for premium seats, international travel, and loyalty programs. Revenue from all segments, including international, domestic, and basic economy, rose year-over-year, with unit revenue turning positive compared to 2023.

United and rival Delta are optimistic about 2025, with Delta’s CEO calling it the airline’s “best financial year in history.”

Exciting: FDA approves Johnson & Johnson’s nasal spray for depression as standalone treatment. Also, Reddit shares rise 7%, hit record as Raymond James raises price target. Moreover, Oracle shares jump 7% on involvement in AI infrastructure initiative that Trump will announce.

🔐 Crypto

Bitcoin $106,322 (+1.44%)
Ether $3,312 (+0.02%)
Solana $249 (+0.4%)
Total market cap $3.64 (+1.03%)
* Prices as of Jan 22nd, 12:20 AM UTC

Crypto market will see a new all-time high in 2025, Binance CEO says

Richard Teng, Binance’s CEO, sees “much clearer regulation” in the U.S. this year under the new Trump administration, adding that this will be supportive for crypto markets.

“If you look at past cycles, this year will be a year that we see a new all-time high for the crypto industry,” he said.

Last year, bitcoin passed the $100,000 price milestone for the first time. This year, it has already crossed the $108,000 mark with many expecting it to double in 2025. In fact, Bitwise thinks that BTC’s fair value could cross $200,000 if it is used as “portfolio insurance” against sovereign default risks.

💵 Personal Finance

Financial Planning: Signs it’s time to sell a stock

We encourage investors to buy stocks for the long-term, but you will eventually have to sell a stock – at times for a loss.

So, how do you know it is time to dump a stock? Look for these signs:

Earnings miss

So, this isn’t a given. Stock may go up despite a miss or fall down despite a beat. But, one miss after another might be a sign of trouble.

You should, however, pay more attention to why this is happening as, in some cases, these misses might be temporary. For example, we have seen stocks fail in recent times due to the situation in Russia and the Middle East.

Poor guidance

A lot of people pay attention to earnings but we ask you to pay more attention to guidance, i.e.: what the future holds.

Some companies have stopped giving guidance but some still do. These figures tell what the future holds and if a company expects revenue/profit to increase.

Poor guidance is a major cause of concern and in most cases, a company will fall if it offers low guidance.

Reduced or no dividends

Not all companies pay dividends but if one does and it suddenly decides to stop issuing dividends or reduce dividends to save on cash, then it could be a sign of trouble.

Shares typically start to slump when the dividend is cut, so make a decision.

💰 Be a Better Investor

“It is thrifty to prepare today for the wants of tomorrow.”

Aesop

Resources:

What did you think of today's newsletter?

Login or Subscribe to participate in polls.

👩🏽‍⚖️ Legal Stuff
Nothing in this newsletter is financial advice. Always do your own research and think for yourself.