Stocks on Wall Street tumbled on Friday, with Wall Street suffering its worst one-day loss since October 2020 as fears mounted over Federal Reserve plans.
Dow, S&P 500, NASDAQ daily charts
The coming week is expected to be another busy one amid further earnings from Apple (NASDAQ:), Microsoft (NASDAQ:), Amazon (NASDAQ:), Google parent Alphabet (NASDAQ:), Facebook parent Meta Platforms ( NASDAQ: ), Twitter (NYSE:), Intel (NASDAQ:), Qualcomm (NASDAQ:), Spotify (NYSE:), Pinterest (NYSE:) and Robinhood (NASDAQ:).
The earnings agenda also includes other high-profile companies such as Exxon Mobil (NYSE:), Chevron (NYSE:), McDonald’s (NYSE:), Boeing (NYSE:), Caterpillar (NYSE:), Ford Motor (NYSE:), General Motors ( NYSE:), United Parcel Service (NYSE:), Coca-Cola (NYSE:), Visa (NYSE:), Mastercard (NYSE:) and General Electric (NYSE:).
Add to that key economic data on the agenda including the latest report on (PCE) inflation and we have a full week ahead of us.
Regardless of which direction the market is headed, here are two high-tech stocks we highlight: one should be in demand, and the other is losing appeal.
However, remember that our time frame is only for the coming week.
Stock to buy: Tesla
As the stock market struggles, Tesla (NASDAQ:) stock has held up quite well, especially when compared to other high-growth companies with sky-high valuations.
We expect this trend to continue in the coming days as investors react to a number of developments surrounding the Elon Musk-led electric vehicle maker.
Tesla reported earnings growth when it released its latest financial results last week, easily beating analysts’ estimates for both revenue and earnings for the first quarter of 2022.
For the period ended March 31, Tesla reported earnings of $3.22 per share and revenue of $18.76 billion. Both numbers were the highest in the EV company’s history and reflect an increase in vehicle deliveries, a higher average selling price (ASP) and growth in other areas of the business.
Even more impressively, Tesla also posted record auto margins of 32.9%, more than double those of legacy firms like Ford (NYSE:) and General Motors (NYSE:).
On the company’s earnings call, CEO Elon Musk said that Tesla remains confident of being able to grow at least 50% from 2021 numbers.
In another interesting development, Musk said on Twitter over the weekend that he confronted Microsoft co-founder Bill Gates about holding a $500 million short position on Tesla.
musk tweet
That could potentially trigger a brief squeeze on Gates, boosting Tesla shares in the process.
TSLA is down just 4.9% year-to-date to end Friday’s session at $1,005.05. At current valuations, Tesla has a market cap of $1.04 trillion, making it the largest automaker in the world, larger than names like Toyota (NYSE:), Daimler (OTC:), GM, Honda (NYSE:), and Ford.
Stock for sale: PayPal
PayPal Holdings (NASDAQ:), whose shares have steadily slumped to new lows in recent sessions, is set to endure another volatile week as the market braces for disappointing financial results from the embattled digital payments provider.
Shares of the San Jose, Calif.-based company are down a whopping 54% so far this year amid a plethora of negative news, including concerns about a slowdown in its core business, increasing competition in the mobile payments processing industry, and an ongoing sell-off at many top tech stocks.
Sentiment over the seedy name – which suspended its services in Russia in the first week of March – took another hit earlier this month after CFO John Rainey left the company to join Walmart (NYSE:).
PYPL closed at $86.03 on Friday, a level not seen since March 2020. At current valuations, PayPal, which is about 72% down from its all-time high of $310.16 hit in July 2021, has a market cap of $99.9 billion.
Earnings and revenue growth, which has slowed dramatically at PayPal, is expected to slow again when the fintech giant releases first-quarter earnings on Wednesday, April 27 at 2:00pm PST.
Consensus is calling for earnings per share of $0.87, down nearly 29% from earnings per share of $1.22 in the year-ago period. Revenue is expected to increase about 6% to $6.4 billion.
Aside from the top-and-bottom-line numbers, investors will also pay close attention to PayPal’s active account additions and the growth in total payment volume (TPV), or the value of all transactions processed on the e-commerce company’s platform give a gift. Both key metrics missed targets last quarter.
Management’s guidance for the current quarter and beyond will also be a focus. We believe PayPal is likely to lower its earnings and revenue growth outlook for the coming months as it continues to struggle with unfavorable consumer spending and customer demand trends in the current environment.
Comments are closed.