Waiting for the influence of quarterly reports on the stock price of Alphabet (Google), due tonight, Amazon, due the day after tomorrow, and Tesla, which can already boast of good results.
Spotlight on stock prices of Tesla, Amazon and Google
The quarterly earnings dance gets into full swing, but the Wall Street stock market does not seem to be much affected by it; it is still the macro news that shifts the balance as it is able to better delineate sentiment for the future.
The results to date from these Q3s have been reassuring, as well as the inflation figure, which, albeit less shockingly than expected, continues to decline.
The progression of the CPI drop is steady and more specifically 8.5% in July, 8.3% in August and now 8.2% signifying that the trend shows continuity and strength, this probably behind the general recovery of Wall Street that saw the Dow Jones performing +2.8% despite an inflation never seen since 1982.
On Friday, San Francisco Fed President Mary Daly said Powell and co. may need to “slow the pace of increases.”
Janet Yellen, the US Treasury secretary warned about the current economic scenario, stressing that the US economy is “healthy” and the financial system is “resilient” but that rate increases of this magnitude cannot be sustained forever.
Tesla, listing and quarterly report
This time Tesla’s Q3 brought no surprises related to Bitcoin, and all those remaining are intact on the Texas company’s balance sheet.
Today the share price is $211.25 with a minus 3.19%.
Musk’s company had chosen to sell $272 million in Bitcoin, generating a positive impact of $101 million on profitability.
None of the 10,700 Bitcoin held by Tesla stock were sold this Q3 nor is there any intent to sell in the future, rather, according to insiders it is time to hold again.
Tesla stock loses 3.19% with one of the poorest results in the S&P 500, the debacle is likely due to the fact that the company has made it known that it will lower the price of some electric vehicles in China.
Because of the cut in the domestic sales outlook on Thursday, Tesla’s stock had lost 6.6%.
Musk’s company, much to the surprise of analysts posted excellent data relative to all items except for revenues, which were slightly below expectations.
Operating expenses were unchanged at 1.7 billion, but the group acknowledged that it is experiencing raw material cost inflation.
From 2 billion in the previous year, operating profit also grew to 3.7 billion due to a growth in vehicle deliveries to 102,439 more units than in 2021 with a sales price premium to make up for inflation and higher raw material costs.
Delivery capacity has increased so much that it has also created delays but not only due to slow production of electric batteries whose production has been shifted to speed up the process.
The company states:
“Battery supply constraints will be the main limiting factor in the growth of the electric vehicle market in the medium and long term.”
Tesla hopes to reduce per-vehicle costs by improving its delivery logistics despite problems stemming from the temporary halt in on-site battery production at the Berlin gigafactory.
The EV company disclosed some technical problems faced by the Berlin gigafactory that led it to shift production of batteries destined for cars made at that site to Texas with employment and economic fallout for Europe and the company itself.
The Texas company hits earnings per share with an excellent +4.98% over the previous quarter, but despite record earnings, it misses sales target, which falls short of estimates by 1.96%.
The third quarter delivered a 55.9% increase in revenues, 21.5 billion US dollars, while the entire automotive segment, despite rising to $18.7 billion from $12.1 billion a year earlier, shows a lower figure than Musk’s company.
This curious case is a product of how much Tesla is driving the entire segment, which actually does not show much performance in the other automakers.
At Amazon, however, the $119.82 (+0.42%) a share is roughly the same value the online sales company had two years ago.
The world’s largest internet company founded in 1994 by Jeff Bezos and now led by CEO Andy Jassy, is not having an easy time, even at the last Prime Day, things did not go well and the company did not even manage to increase sales of its subscriptions on the very day dedicated to promoting them globally bringing home results quite similar to a normal day.
However, a sigh of relief comes from the okay for the construction of the new mega Logistics Hub for Southern Europe and North Africa to be based in Jesi (AN), Italy, 67000 square meters of area that will supply half of Europe with the products of the world’s most popular sales site and cut the company’s costs by a total of 2%.
Jeff Bezos’ company has recently made headlines for declaring (legal) war on the conduct of some brokers who profit through fake reviews on the e-commerce site’s products.
Ten other legal actions of the same nature have been waged domestically by Amazon with the intention of flushing out fraudulent brokers.
On 27 October, the US giant is slated to release Q3 figures for 2022, targeting revenues of $127.59 billion and earnings per share of $0.21.
The vast majority of Bloomberg analysts, agree in declaring Amazon a Buy regardless of the quarterly and only 1.7% recommend selling, the average price forecast is $166.38.
The day after tomorrow Alphabet (in conjunction with the other major tech company Microsoft), will release its own quarterly data, but pending those, the stock is just above parity.
The direction that Google‘s stock could take in view of incoming financial statements is upward towards $104 and downward to $95.
Should resistance be broken we could see an upward trend at least in the short or very short term to $111.40.
On the downside, however, it could veer in this direction if there is a weakness the sellers could target the $95 demand concentration area mentioned above, an area that counts the lows recorded in the first half of October.
The company relies heavily on social-style advertisements, and this very figure will be the focus of investors’ attention.
The Cloud is expected to rise and so is revenue from YouTube.
Zacks Investment Research for Q3 earnings forecasts a -11% decline from last year’s Q3.
Sales are forecast up 9% to $58.35 billion.
Cloud revenues in Q2 grew 36% to $6.27 billion, but posted an operating loss of $858 million, up from a loss of $591 million in Q2 2021.
Earnings estimates fall slightly and are expected to touch -9% year-on-year, however they will recover in 2023 for which a 14% increase ($5.80 per share) is expected.