Tesla, XPeng, Nio & Li Auto all had stellar deliveries in the first quarter 👏
Monday, 4th April 2022 by Gotrade
Hey Gotraders,
We’re kicking off a brand new trading week, and April has historically been the best month of the year for stocks.
“The good news is stocks really appear to love April… Not only is it the best month on average since 1950, but it has also been higher an incredible 15 of the past 16 years as well” - Ryan Detrick, Chief Market Strategist at LPL Financial.
Moving on to events taking place on the world stage, Russia’s war on Ukraine continues. Ukraine has accused Russia of genocide after it was discovered that hundreds of people have been massacred in Bucha. Here’s a great article from CNN about the impact of Russia’s war on the global economy.
Investors will also be keeping their eyes on the Federal Reserve as they plan to tighten monetary policy.
It’s a pretty quiet week in terms of earnings, with just Levi Strauss (LEVI), Conagra (CAG), and Tilray (TLRY) among the notable companies reporting them.
Ok, next up. Let’s take a look at headline news. EV companies have reported really strong deliveries this quarter.
Tesla (TSLA) - Tesla delivered 310,048 vehicles in the first quarter, up 68% year-on-year.
XPeng (XPEV) - XPeng delivered 34,561 vehicles in the first quarter, up 159% year-on-year.
Nio (NIO) - Nio delivered 25,768 vehicles in the first quarter, up 28.5% year-on-year.
Li Auto (LI) - Li Auto delivered 31,716 vehicles in the first quarter, up 152.1% year-on-year.
Companies have had to battle supply chain issues, rising costs of parts, and production halts due to rising Covid cases in China. It’s amazing that these companies have managed to deliver such strong numbers!
Why is this important? It looks like Russia’s war on Ukraine has made the world realise that we need to stop relying on Russia for oil. The way to reduce reliance is by transitioning to clean energy vehicles.
A recent report by the International Renewable Energy Agency shows that investors’ interest in sustainable and resilient assets, including renewables have “sharpened.”
That is definitely good news for EV companies!
📉 Cathie Wood’s ARK Innovation ETF gets downgraded ⏬
Errmm… It looks like Morningstar isn’t convinced of Cathie Wood’s strategy. They think that she isn’t doing enough to avert drawdowns in her flagship fund - ARK Innovation ETF (ARKK), and this is hurting her investors.
They downgraded their rating on ARK Innovation from neutral to negative. Ouch!
“Since its meteoric rise in 2020, the strategy's exchange-traded fund has been one of the worst-performing U.S.-sold funds, as the aggressive-growth stocks it held fell back to earth. Its wretched 45.5% loss over the trailing 12 months through February 2022 significantly lagged the 7.9% decline of the average fund in the technology Morningstar Category and the Russell Midcap Growth Index’s 4.3% loss… The strategy behaves more like a tech fund than its own mid-growth category… Yet, Wood has doubled down on her perilous approach” - Robby Greengold, an analyst at Morningstar.
Cathie Wood has been known for her strong conviction in disruptive stocks. She believes that her innovation stocks are “way undervalued” and that the losses are temporary!
Shares of ARKK closed at $67.54, down 30.36% year-to-date.
📉 Shares of Blackberry plummeted nearly 10% after reporting earnings 🙈
Uh oh… Shares of Blackberry (BB) are down nearly 10% after reporting earnings. Shares plummeted as much as 12% at one point before reversing slightly.
They reported weaker-than-expected fourth-quarter results. Increased competition from the likes of Microsoft (MSFT) & IBM (IBM), in addition to the chip shortage, impacted its performance.
“Major OEMs have indicated continuous supply chain headwinds, particular chip shortages, although they expected the situation to largely improve as the year progresses.. The conflict in Ukraine has added a further disruption to an already challenging environment for the auto industry, and we will continue to monitor that impact” - CEO John Chen.
Shares of Blackberry closed at $9.75, down 9.52% for the day.
Top movers & shakers 🎢
What else is making headline news 📰
Twitter (TWTR) shares soar more than 25% after Elon Musk takes 9% stake in social media company.
Starbucks’ (SBUX) New York City Reserve Roastery becomes the 9th cafe to unionize.
Tesla (TSLA) unable to restart Shanghai production on Monday.
DC attorney general says fighting big tech is like David versus Goliath.
Amazon (AMZN) workers just voted to join a union — here’s what happens next.
Ryanair (RYAAY) narrows full-year loss forecast, increases fuel hedging.
Oil shakes off early loss to top $100 as Vitol warns on prices.
Canada to support General Motors (GM) multi-billion-dollar investments in two plants.
Food stamp recipients are the new frontier for Target (TGT).
Fed meeting minutes, Conagra (CAG) earnings: What to know in markets this week.
China removes key hurdle to allow U.S. full access to audits.
Airlines cancel hundreds of weekend flights as thunderstorms sweep through Florida.
Biden’s answer to high gas prices is to boost US battery production.
Popular companies releasing earnings this week 💰
Wednesday: Exelon (EXC), Levi Strauss (LEVI), Tilray (TLRY)
Thursday: Constellation Brands (STZ), Conagra (CAG), Lamb Weston (LW)
A company’s market value may fluctuate considerably around the time that the earnings report is expected to be published. Stock prices may rise or fall according to analysts' speculative estimates, released prior to the actual earnings announcement.
The earnings season can be a time of great opportunity since better-than-expected figures could cause a company’s stock to greatly increase in value. Worse-than-expected results could have the opposite effect.
That’s all from us for now.
Signing out,
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