Share to Twitter Share to Linkedin Tesla’s (TSLA) market cap surpassed the trillion-dollar mark, driven by a post-earnings rally that got a boost from the announcement of a 100,000-vehicle order from Hertz (HTZ), which might not even happen. Even if it does come to pass, the Hertz order is a drop in the bucket of growth expectations baked into Tesla’s valuation. Tesla needs 155 Hertz-sized orders to justify the revenue expectations in its stock price. Put another way, the $1.2 trillion valuation implies Tesla owns 60%+ of the entire global passenger EV market and becomes more profitable than Apple (AAPL) by 2030. This report provides objective perspective on how outrageously high the valuation of Tesla stock is and the clear impracticality of the company meeting the expectations baked into its valuation. Tesla’s Valuation vs. Competitors Makes No Sense Tesla’s market cap is now greater than the next 10 largest (ranked by market cap) auto manufacturers … [Read more...] about Tesla: $1 Trillion Of Speculation
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Share to Twitter Share to Linkedin The Federal Reserve is planning to raise interest rates (the Federal Funds rate) earlier than expected to cool down the hot economy. The stock market is reacting swiftly: the Nasdaq 100 is in correction territory. What can investors expect from the stock market when interest rates rise? Interest rates are going up Super-easy pandemic monetary policy gave strong support to asset prices. The prices of bonds in the secondary markets increased as new bonds could be issued at lower rates (and thus lower current yields - see example on how interest rates affect bonds). Historically low bond yields and massive fiscal stimulus drove investors into riskier assets including stocks, which was a major contributor of the outperformance of the S&P 500 in 2020 and 2021. When there's an alternative to equities for yield again, investors recalculate the equity risk premium. High-flying equity valuations are getting a … [Read more...] about How Do Stocks Perform When Interest Rates Rise?
It's been a tumultuous few weeks in the stock market with fears about the pandemic and economy sending prices down across various sectors. Many companies were overvalued to begin with, making it difficult to find great buying opportunities even among the stocks experiencing steep losses. But they do exist and often not where you'd expect. One such stock is Levi Strauss and Co. ( NYSE:LEVI ) . Levi's stock trades at less than 20 times trailing 12-month earnings, and Wall Street expects this modest stock to gain 50% or more over the next year. Here's why it might be a great addition to your portfolio. Everyone is wearing jeans Levi's is an iconic apparel brand whose name is inextricably linked with blue denim. It's one of the oldest clothing brands in the U.S., but the company has only been public since 2019, aside from an earlier stint on the markets over three decades ago. Image source: Getty Images. 2020 was a difficult time for the company as it was for most … [Read more...] about Wall Street Expects This Cheap Stock to Grow 60%
It's a remarkable time to be an investor. Over the past year, the market has not only recovered its losses from the coronavirus crash, but marked multiple days of new thrilling highs. The stock market has shown increased volatility in recent weeks. But for the time being, optimism about the U.S. economy's ongoing recovery is outweighing investor concern about the rising rate of inflation. Even so, it's more vital now than ever that investors focus their portfolios on resilient stocks that can continue providing growth and generating consistent returns in a variety of market scenarios. Are you ready to fortify your portfolio in the month of April with some winning stock buys? Let's take a look at two red-hot stocks that fit the bill and can easily stimulate optimal portfolio growth for decades to come. Image source: Getty Images. 1. Zoom Zoom Video Communications ( NASDAQ:ZM ) has by far been one of the most popular stocks among investors since the pandemic began. … [Read more...] about Got $1,000? 2 of Today’s Hot Stocks You Can Buy and Hold for a Lifetime
The higher one climbs, the harder one falls. Such is the fate for stocks that are trading at ridiculously high price-to-earnings ratios. This is especially the case in the context of the ongoing market sell-off, where the S&P 500 has now declined 8.3% from all-time highs. These three companies -- an electric vehicle (EV) maker, a videoconferencing leader, and a struggling biotech -- already have their growth potential maxed out in their stock prices, if not more. Today, let's look at why investors should be in no hurry to buy their dips. Image source: Getty Images. 1. Tesla Nowadays, many investors view Tesla ( NASDAQ:TSLA ) as a revolutionary company at the forefront of innovation in the EV industry. Its financials seem to suggest so as well. In its third-quarter update, the company said its sales increased by 45% compared with last year, to $8.7 billion. As its revenue increased, so did its profits. Tesla's gross margin came in at 23.5% versus … [Read more...] about These 3 Stocks Are Trading at Ludicrous P/E Ratios. Should Investors Avoid Them?
When reviewing the companies with the fastest growth in 2020, it immediately becomes clear that the COVID-19 pandemic is behind most of the changes that have propelled sales for diagnostics and remote-work companies. Fulgent Genetics ( NASDAQ:FLGT ) and Zoom Video Communications ( NASDAQ:ZM ) have captured those trends and are delivering some of the highest growth around. Image source: Getty Images 1. Fulgent Genetics In the competitive market of diagnostic testing, Fulgent is differentiating itself by offering flexibility and affordability to its customers. The company has one of the largest genomic test menus in the industry (almost 19,000 tests) and can provide pre-established tests or customize them for specific needs. Management reported year-over-year revenue growth of 880% in the third quarter, thanks to a 5,000% increase in testing volume. The company expects full-year revenue of $235 million, compared to $32.5 million in 2019 -- good for 623% … [Read more...] about 2 of the Highest Growth Stocks in the Market Today
Image source: The Motley Fool. Bank of the Ozarks ( NASDAQ:OZK ) Jan 21, 2022 , 11:00 a.m. ET Contents: Prepared Remarks Questions and Answers Call Participants Prepared Remarks: Operator Good day, and thank you for standing by. Welcome to the Bank OZK fourth quarter 2021 earnings conference call. [Operator instructions] Please be advised that today's conference is being recorded. [Operator instructions] I would like to hand the conference over to your host today, Mr. Tim Hicks. Please go ahead. Tim Hicks -- Chief Credit and Administrative Officer Good morning. I'm Tim Hicks, chief credit and administrative officer for Bank OZK. Thank you for joining our call this morning and participating in our question-and-answer session. In today's Q&A session, we may make forward-looking statements about our expectations, estimates and outlook for the future. Please refer to our earnings release, management comments and other public filings for … [Read more...] about Bank of the Ozarks (OZK) Q4 2021 Earnings Call Transcript
In this weekend conversation, Tom and David Gardner, co-founders of The Motley Fool, talk about things including: How investing fits into the pursuit of becoming smarter, happier, and richer. The importance of being a lifelong learner and investor. Using index funds and how to approach buying individual stocks. Two core Motley Fool approaches -- Rule Breaker and Everlasting investing philosophies. Setting the right expectations for returns. Mastering the mindset of investing and managing volatility. You can follow Tom and David on Twitter @TomGardnerFool and @davidgfool. To catch full episodes of all The Motley Fool's free podcasts, check out our podcast center . To get started investing, check out our quick-start guide to investing in stocks . A full transcript follows the video. This video was recorded on Jan. 08, 2022. David Gardner: There's no substitute for being invested with skin in the game in the world at large, and it does have you, once … [Read more...] about How to Invest — and Why — With Tom and David Gardner
Share to Twitter Share to Linkedin I wrote an earlier version of this column rather quickly, without writing down the math. The point made before — that this is a good time to do Roth conversions — stands, but I want to be more precise. First, Roth conversions make sense when your tax bracket is temporarily low. Given our country’s long-term fiscal insolvency, tax rates are likely to be raised. Meanwhile, the real long-term pre-tax return we can earn from saving is essentially zero, but we have to pay taxes on nominal, not real income. Finally, the investment climate is highly uncertain suggesting the value of paying off sure liabilities. Investing these days, particularly in the stock market, is scary. The stock market’s PE ratio is historically very high. There is also considerable uncertainty about 1) annual inflation staying at 7 percent or even going higher, 2) the Fed's raising interest rates, 3) the precise course and curse of Omicron, 4) the potential … [Read more...] about Now Is a Good Time For Roth Conversions
Super Bowl champion, Eli Manning, joins the show in just a little bit, but roll down the window because sentiment stinks right now in the stock market. U.S. equity markets are coming off their worst week in nearly two years and headed for more losses as we start the week. Netflix, one of the best performing stocks of the past 10 years, fell nearly 22% on Friday, its worst day since 2012. Shares of Amazon posted their worst week since 2018, and they're down 20% from all time highs. Tech stocks, as Liz Young explained to us just a few episodes ago, are super sensitive to rising interest rates, especially as their growth rates are slowing down. This week will also bring a steady stream of earnings, including reports from some of the most valuable companies by market capitalization, with widely held stocks reporting results, including Apple, Microsoft, IBM, and Johnson and Johnson. Investors have no patience for missed earnings estimates or weak guidance. They punished Netflix last … [Read more...] about Eli Manning Goes Long Private Equity