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It might be difficult to imagine how a US $1.6 trillion market cap company would double or triple in value. Nevertheless, recall that it was only two years ago that the company crossed the US $1 trillion market capitalization mark. Crossing this threshold does not have significance though. In the past, we have had companies with much higher valuations (the record is held by the East India Trade company at a record market cap north of US $8 trillion in today’s dollar).
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In this post, we talk about 2021 US stock market predictions made by the large investment banks and Tesla’s Q4 2021 vehicle delivery numbers.
Stock market predictions are mostly incorrect
It is a time honored tradition to make a stock market prediction as we transition to a new year. All the major investment firms do it. As we were planning on making one ourselves, we realize that it’s really hard. The stock market is not the economy. Rather, it is a reflection of the expectation on how the economy will…
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Government policies accelerating adoption of EVs
The secular shift towards electrification of transportation has begun. According to the Intergovernmental Panel on Climate Change, transportation accounts for a quarter of global energy-related greenhouse gas emissions, and road transportation makes up 72% of that.
In an effort to curb greenhouse gas emissions and to develop industrial capabilities for the future, major global economies have set aggressive targets for CO2 emissions and EV adoption. From a policy perspective, Europe and China have led the way.
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To say 2020 has been tumultuous is an understatement in itself. In this article, we’ll glance back at some of the highlights of the year, through the lens of the market.
- The overall market performance in 2020 and some historical context.
- Stay-at-home stocks were the big winner.
- And the oil investment that you made in May 2020? Turned out to not be such a great idea.
- Don’t fall into the IPO FOMO.
The performance of the US market
Profits are down in 2020, but are expected to rebound in 2021
The pandemic and the resulting prolonged lockdown affected the overall profitability of…
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Ant Group was going public in both the Hong Kong and Shanghai exchanges. Initially, it was slated to be the largest IPO of all time, a fintech firm valued at more than US $300 billion. But out of nowhere, changes in the regulatory environment halted its intended IPO. Now, the company has to restructure its operations before it can try again in either 2021 or 2022.
So what happened? …
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The challenge of adding Tesla to the S&P 500
Following the announcement on November 16th that Tesla will enter the S&P 500 index, the company’s share price surged more than 40%, and the average trading volume of the stock spiked (see Figure 1).
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It’s another IPO season in the US. The last one in 2020. One of the biggest names to go public is Airbnb. In this week’s article, we discuss Airbnb’s recovery.
The resiliency of Airbnb
As the world grounded to a halt due to COVID-19, global travel came to a standstill, so did Airbnb’s business. But unlike its hotel competitors, Airbnb’s business model proved to be much more resilient.
Roughly, you can categorize travel into four categories:
- International / Inside Cities
- International / Outside Cities
- Domestic / Inside Cities
- …
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The biggest news from this past week is probably the announcement that Pfizer’s BioNTech and COVID-10 vaccine is 90% effective in a trial with 43,538 participants (where half received placebos). During the trial, 94 contracted COVID-19 (mostly of whom were in the placebo group, it seems). Pfizer plans to continue the trial until it reaches 164 cases of COVID-19.
In this article, we will be discussing the path forward and what comes next. When can we expect wide-scale control of the pandemic?
The Vaccine
Vaccines work…
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Tesla’s Q3 2020 Earnings — strongest quarter ever
Three key takeaways from Tesla’s latest earnings report:
The first takeaway
Tesla reported its strongest quarter ever. The company generated US $7.6 billion, which is a 39% revenue growth year-over-year. Beyond this top line number, two of Tesla’s most important metrics for investors are car deliveries (the primary way it makes money) and operating cash flow (to continue to fund operations and factory build outs). This past quarter Tesla delivered 139,593 cars, which is also a record, while generating US $1.4 billion from operations. …
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In this article, we will be discussing the extraordinary rise of the alternative meat industry, and how it is an existential threat to the incumbent meat producers.
The world loves meat
Global meat consumption has been trending up in the past decades. As countries become more prosperous, their population consumes more meat.
