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In March, the Consumer Price Index (CPI), which measures the average prices consumers pay for everyday items, rose to 3.3% from 2.4% in February. The increase was largely driven by soaring gas prices, which have also affected other parts of the economy. With inflation already influencing equity markets, investors may want stocks that can perform in an inflationary environment. Three examples highlighted are Walmart, Visa, and Netflix, with reported gains of +2.15%, +0.71%, and +9.71%, respectively.
One reason Walmart is viewed positively is its push into digital commerce. The company is among the largest e-commerce players in the U.S., and as retail transactions continue shifting online, it could benefit through higher revenue and lower operating costs. The move to digital is also expected to support Walmart’s higher-margin advertising business.
Walmart is also described as an attractive dividend stock. The company has increased its dividend payouts for 53 consecutive years, earning it the designation of a “Dividend King,” defined as a corporation with 50 or more consecutive annual dividend increases. The article suggests that income-focused investors seeking stability in volatile conditions may find Walmart particularly compelling for long-term performance.
Visa’s business model is presented as potentially benefiting from inflation. The company earns revenue by charging fees as a percentage of each credit or debit card transaction processed through its network. In general, higher prices can translate into higher fees per transaction and higher total revenue, assuming other factors remain constant.
The article notes that consumer behavior may change and that lower transaction volume could partially offset inflation-driven gains. Still, it states that Visa has historically performed well during inflationary periods.
It also points to Visa’s large addressable market and “wide moat,” estimating that there are still trillions of dollars in transaction volume that can be brought into its ecosystem.
Netflix recently announced another price increase. While some consumers may object, the article argues that Netflix’s paid subscribers and revenue have continued moving in the right direction in recent years even after price hikes. It characterizes Netflix as a leading entertainment and media company with strong pricing power, suggesting inflation is unlikely to be a major issue for the business.
The article also addresses whether the stock can still outperform the market given intensifying competition in streaming. It offers three reasons:
Premium gym chains are entering a “golden era” that is ending or already in decline, as rising operating costs collide with shifting consumer preferences toward more flexible, community-based ways to exercise. Long-term memberships are shrinking, margins are pressured by higher rents and facility expenses, and competition from smaller, more personalized…
