Black Swan Street: Stock Market Weekly (July 22-July 26 2024)

Welcome to Black Swan Street!

Welcome back!! It’s @KeatonInglis here with another edition of Black Swan Street…

Let’s get into it:

• Tesla’s Challenges Continue🔋

• The Swan’s Selections🦢

• In Other News🗞️

• This Week Upcoming In The Stock Market🔮

Today’s edition is sponsored by Rainbook, find out if you’re overpaying your financial advisor!

Read time: 5 minutes

Tesla’s Challenges Continue🔋

Tesla's recent Q2 2024 earnings report paints a picture of a company navigating turbulent waters while keeping its eyes on the horizon. The electric vehicle giant reported mixed results that have left investors and analysts with much to ponder.

Financial Snapshot:

• Earnings per Share (EPS): 52 cents, missing expectations of 62 cents

• Revenue: $25.5 billion, slightly above forecasts

• Net Income: $1.48 billion, down 45% year-over-year

• Operating Margin: Decreased to 6.3%

Investor Sentiment:

• Analyst Ratings: Stock Target Advisor’s analysis reveals a slightly bullish outlook for Tesla, with an average analyst target price of $206.94 compared to the current stock price of $246.38.

• Stock Performance: Following the earnings report, Tesla's stock experienced a decline due to the mixed financial results and ongoing challenges

The numbers tell a story of compressed margins and declining profitability, with Tesla's net income nearly halving compared to the same quarter last year. This downturn was primarily driven by reduced automotive revenue and increased operating expenses related to AI projects.

However, it's not all doom and gloom. Tesla's energy segment shone brightly, nearly doubling its revenue to over $3 billion. This diversification could prove crucial as the company navigates a competitive EV landscape.

Looking ahead, Tesla is betting big on innovation:

• A more affordable vehicle model is in development, slated for production in early 2025.

• The company plans to deploy its "Optimus" robots in factories by 2025.

• A "robotaxi" reveal is scheduled for October 10, 2024, potentially opening new revenue streams.

While these initiatives showcase Tesla's innovative spirit, they also underscore the challenges of maintaining growth in a maturing EV market. As Tesla balances immediate financial pressures with long-term technological bets, investors will be watching closely to see if the company can recharge its growth engine.

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The Swan’s Selections🦢

 💬WhatsApp Hits 100 Million Monthly Users in the US: This marks a significant milestone for Meta's messaging app in a market dominated by iMessage and SMS. With double-digit growth in daily users, WhatsApp is gaining traction as a cross-platform solution for iPhone and Android communication. This growth is crucial for Meta's advertising strategy, particularly through click-to-message ads. The news comes as Meta anticipates strong second-quarter earnings, with analysts projecting a 20% sales increase.

🚕Uber, Lyft Win California Ruling to Treat Drivers as Contractors: The California Supreme Court upheld Proposition 22, allowing app-based companies to classify drivers as independent contractors rather than employees. This ruling, dismissing a lawsuit claiming the proposition was unconstitutional, is a major win for the ride-hailing industry.

🏀The NBA Sign a $77B Streaming Deal: The NBA's new 11-year, $77 billion broadcasting deal with ESPN, NBCUniversal, and Amazon marks a significant shift in sports media. This agreement increases games on broadcast TV and expands streaming options, reflecting changing viewer habits. Notably, long-time partner TNT Sports was excluded, potentially leading to legal action. The deal's importance lies in its adaptation to the digital age, balancing traditional networks with streaming platforms to maximize fan accessibility. It also demonstrates the increasing value of live sports content in a fragmented media landscape, as leagues seek to reach broader audiences through diverse distribution channels.

In Other News🗞

• Fortune 500 firms may see $5.4B in losses tied to CrowdStrike (RT)

• Activist Elliott built a stake in Starbucks (RT)

• Global equity funds saw a fourth-straight week of inflows (RT)

• Reddit signed content partnerships with NFL, NBA, MLB, others (BBG)

• Earth logged the hottest day on record (CNBC)

• US home prices hit a record-high (WSJ)

• Leveraged tech bets lost 37% after drawing $2B of inflows (BBG)

• Secondaries deal flow rose 58% YoY in H1 (WSJ)

• US GDP blasts pasts estimates for 2.8% YoY growth in Q2 (CNBC)

• Macro hedge funds are expected to dump a record $45B in stocks (RT)

• Citi's error-riddled loan reports led to a $136M fine (FT)

• OpenAI unveiled SearchGPT to rival Google (WSJ)

• GenAI VC investments show no signs of slowing (TC)

This Week Upcoming in the Stock Market🔮

Earnings Calendar This Week:

Economic Calendar This Week:

The Wrap-Up🔄

🎊🎉 That’s it for today 🎉🎊

Thank you again to our sponsor Rainbook

Per usual, let us know what you thought!!⬇️