Consumer Discretionary

Tesla’s Stock Removed From Baird’s Bearish List With Analysts Bullish on Robotaxis and Energy

/ / Consumer Discretionary /

By Ciara Linnane Analysts still expect a ‘messy’ first quarter and say second-quarter expectations are too high Baird removed Tesla Inc. from its Bearish Fresh Pick list on Tuesday and said the news that the company’s robotaxis would debut on Aug. 8. combined with growth in the energy business, were positives that weigh against weaker-than-expected delivery numbers. Analysts led by Ben Kallo said they have fielded dozens of calls regarding Tesla’s (TSLA) recent first-quarter production numbers and nearly half centered on whether the bad news is now priced in to the stock. “We think Q1 results will be messy due to several one-time items and continue to believe Q2 estimates are likely still high,” Kallo wrote in a note to clients. “On the other hand, the announced Robotaxi unveil, emphasis on increasing FSD (full self-driving) attach rates, and Energy business growth are positives.” Baird named Tesla a Bearish Fresh Pick […]

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Amazon.com’s New ‘Cost to Serve’ Model Likely to Bring Upside to Retail Profit, Morgan Stanley Says

/ / Consumer Discretionary /

Amazon.com’s (AMZN) new “cost to serve” model highlights the potential for “significant upside” to base case estimates for the e-commerce giant, Morgan Stanley in a report emailed Monday. The new model shows “material upside to retail profit and gives us increased confidence” in the company’s ability to deliver more than $100 billion in earnings before interest and taxes in 2026, Morgan Stanley said. Morgan Stanley raised Amazon’s price target to $215 from $200 and kept the overweight rating. It also affirmed Amazon as a “top pick,” saying it’s “encouraged by the multiyear, efficiency based cash flow story.” “Our new breakdown of retail cost to serve (which includes shipping, fulfillment, payment processing, inbound shipping, returns, and inventory shrinkage costs) highlights how early it is in [Amazon’s] retail profitability improvement efforts,” the report said. Comments by Amazon’s management provided a “compass to follow and a path toward $10-$11 of ’26 FCF/share,” the

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Spotify Q1 Preview: Analyst Sees 2024 Shaping Up With Revenue Acceleration, Enhanced Margins

/ / Consumer Discretionary /

As Spotify Technology SA (NYSE:SPOT) gears up for its first-quarter earnings release on April 23. Wall Street expects Spotify to report 81 cents in EPS and $3.95 billion in revenue. Spotify stock is up 135% over the past year, rising 64% YTD. As the company heads towards its Q1 earnings print, analysts are buzzing with optimism and anticipation.

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Walmart’s Alternative Businesses to Reshape Income, Enable Transformation, UBS Says

/ / Consumer Discretionary /

Walmart’s (WMT) alternative businesses have the potential to contribute nearly one-third of its profit over the next three years and transform the company from a global retailer into a “versatile, technology-driven behemoth,” UBS said in a note Monday. The company’s strategic diversification into areas like advertising, marketplace fees, fulfillment services, membership income, and data analytics monetization will continue to reshape Walmart’s profit and loss as the company gains scale in these businesses and evolves into more than a retailer, according to the note. UBS estimated that about 20% of Walmart’s 2023 earnings before interest and tax came from these new high margin alternative revenue streams and the figure could grow to 31% of the company’s profits in 2026. “This makes [Walmart’s] long-term investment case compelling,” UBS said in its note. The firm has a buy rating on the company’s stock with a 12-month price target of $63.

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Tesla Deliveries Likely to Bottom by Q2 Ahead of ‘Major’ Model Rejuvenation, Morgan Stanley Says

/ / Consumer Discretionary /

Tesla’s (TSLA) deliveries are likely to bottom by Q2 following a weak Q1 and before a “major rejuvenation of the model cycle,” Morgan Stanley said Thursday in a report. “Tesla’s weak Q1 update is a clear sign of the ongoing EV ‘shake-out’ phase,” Morgan Stanley said. The company reported 386,810 vehicle deliveries in Q1, trailing the Visible Alpha consensus estimate of 454,200. Morgan Stanley lowered its full-year forecast for the company’s deliveries to 1.75 million from 1.95 million. The investment firm also cut long-term delivery projections through 2030. Morgan Stanley also reduced its estimates for Tesla’s 2024 operating margin, free cash flow and non-GAAP earnings per share. The firm maintained its overweight rating on Tesla, partly because of its position as an artificial-intelligence beneficiary. The price target on stock was cut to $310 from $320.

Tesla Deliveries Likely to Bottom by Q2 Ahead of ‘Major’ Model Rejuvenation, Morgan Stanley Says Read Post »

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