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Tesla (TSLA) Helps Nasdaq Move Higher; FDX Gets New CEO
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Stock indexes picked up something of a head of steam in the final hour of trading for the normal session. Recent sector winners — namely Energy and Materials — brought up the rear, but otherwise the day saw green in most industries. The Dow grew 94 points, +0.27% on the day, the S&P 500 was +0.71% and the Nasdaq outperformed the field: +185 points or +1.31%. The small-cap Russell 2000 had been negative mere minutes before the bell, but would up flat: +0.08%.
Tesla (TSLA - Free Report) grabbed headlines early on news of a planned stock split, and the stock gained +8% on the day. The last time the EV leader took this initiative, it was a 5-for-1 split a year and a half ago. Shares have grown tenfold since then, and have now crossed into positive territory year to date. Taking this trillion-dollar market cap company down to a more digestible nominal figure per share — currently trading near $1100 — would open up ownership to a wider spectrum of investor, which theoretically would then drive the share price from there.
The knock on Tesla continues to be that its price point remains far beyond its current fundamentals. As an auto manufacturer delivering roughly a million cars per year, by some accounts it would need to increase production 16x to reach fair value. Then again, Tesla is no mere auto manufacturer — it’s also a foremost EV battery plant, etc. Succinctly, the high Tesla valuation — more than 100x P/E — is more tied to the “story of Tesla” than it is to the current facts on the ground.
Issues in China related to new Covid outbreaks have sandbagged Tesla operations in the company’s biggest market. Also, with traditional automakers in the U.S., Europe and Japan — Ford (F - Free Report) , General Motors (GM - Free Report) , Volkswagen (VWAGY - Free Report) and Nissan (NSANY - Free Report) , among others — all getting into the EV market now or in the near future, Tesla looks to have some real competition for the first time in the company’s existence.
FedEx (FDX - Free Report) shares are up more than +3% in late trading today, upon news of a shakeup in its front office: with CEO and founder Fred Smith retaining his chairmanship but rescinding CEO duties to current President and COO Raj Subramaniam. FedEx has missed earnings expectations in three out of its last four quarters, and shares are -17% over the past year. Smith, now 77, founded the delivery and logistics giant 51 years ago.
Image: Bigstock
Tesla (TSLA) Helps Nasdaq Move Higher; FDX Gets New CEO
Stock indexes picked up something of a head of steam in the final hour of trading for the normal session. Recent sector winners — namely Energy and Materials — brought up the rear, but otherwise the day saw green in most industries. The Dow grew 94 points, +0.27% on the day, the S&P 500 was +0.71% and the Nasdaq outperformed the field: +185 points or +1.31%. The small-cap Russell 2000 had been negative mere minutes before the bell, but would up flat: +0.08%.
Tesla (TSLA - Free Report) grabbed headlines early on news of a planned stock split, and the stock gained +8% on the day. The last time the EV leader took this initiative, it was a 5-for-1 split a year and a half ago. Shares have grown tenfold since then, and have now crossed into positive territory year to date. Taking this trillion-dollar market cap company down to a more digestible nominal figure per share — currently trading near $1100 — would open up ownership to a wider spectrum of investor, which theoretically would then drive the share price from there.
The knock on Tesla continues to be that its price point remains far beyond its current fundamentals. As an auto manufacturer delivering roughly a million cars per year, by some accounts it would need to increase production 16x to reach fair value. Then again, Tesla is no mere auto manufacturer — it’s also a foremost EV battery plant, etc. Succinctly, the high Tesla valuation — more than 100x P/E — is more tied to the “story of Tesla” than it is to the current facts on the ground.
Issues in China related to new Covid outbreaks have sandbagged Tesla operations in the company’s biggest market. Also, with traditional automakers in the U.S., Europe and Japan — Ford (F - Free Report) , General Motors (GM - Free Report) , Volkswagen (VWAGY - Free Report) and Nissan (NSANY - Free Report) , among others — all getting into the EV market now or in the near future, Tesla looks to have some real competition for the first time in the company’s existence.
FedEx (FDX - Free Report) shares are up more than +3% in late trading today, upon news of a shakeup in its front office: with CEO and founder Fred Smith retaining his chairmanship but rescinding CEO duties to current President and COO Raj Subramaniam. FedEx has missed earnings expectations in three out of its last four quarters, and shares are -17% over the past year. Smith, now 77, founded the delivery and logistics giant 51 years ago.
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