- Rising bond rates don’t mean good things for the stock market.
- One-time gross margin issues for Tesla need to be watched to make sure it’s not a pattern.
- Auto companies’ pain is semiconductors' and chip makers’ gain.
- Respect the market.
- Looking for a helping hand in the market? Members of Nail Tech Earnings get exclusive ideas and guidance to navigate any climate. Get started today »
Last week’s stock market action has people throughout the market asking questions. I think we always need to respect the market and the directions that it’s taking. The bond market especially is smart. So when rates rise like they do, it’s something we need to pay attention to closely.
I love Tesla (NASDAQ:TSLA) as a company, but rising rates and one-time issues for their gross margins last quarter are also important to watch. I’m not ready to look to 2022 earnings, so the company is in an in-between valuation stage. And the semiconductor shortage that is hitting the whole auto industry could affect them too.
I talk about both issues in the video above. I also talk about a semiconductor company I like as a result of the auto industry issues and general supply tightness. Limited supply and high demand equals good things for Micron (MU).
Market outlook – The recent sell-off and why it makes sense - 00:30-10:45
The increasing risks in the market, driven by bond rates and inflation
High PCE report as a warning sign
The bond market’s push for higher rates despite the Fed’s efforts
The power of momentum and algorithms, with GameStop as an example
What’s the near-term outlook and direction for the market
Stock Focus – Concerns for Tesla – 10:45-18:15
One-time issues in the Q4 report around gross margins
The importance of gross margins to the Tesla story
Semiconductor shortage and interruptions to the delivery story for Tesla models
The importance of showing that the Q4 issues were one-time and not recurring
Bonus stock – Micron looking attractive – 18:15-23:00
DRAM pricing driving upside
There may be more room to run than the usual Micron cycle
The importance of zeroing in on the key driver for a given stock
Final thoughts – Respect the down move – 23:00-26:00
- The case for selling down and buying up, selling weakness and buying strength
#1 Tech Stock Pick & Trading Service On SA. Trade Like A Pro.
Raising Annual Prices March 15th
Subscribers are saying;
"personal trading account to go up by ~200% since January 2020"
"3 for 3, baby!"
"paid for itself many times over."
This article was written by
Starting out I could make a mean straight black coffee. But ask me to add some sugar or milk though was a problem. So they got fed up and said, just give him some stocks to follow. That was in the 90s tech boom. Yeah. That worked out.
So, now, mid-life crisis I enjoy second guessing the Fed, which is usually a good strategy. They are not traders, they have no risk discipline, they are having way too much fun with this QE-QT thing and because of their powerful position, are usually way too over-confident in their decision making which is a hint to bad decision making.
My customers have seen that I've been net net pretty good at consistently second guessing the Fed.
Our EPS estimates factor into Street numbers.
I've been on CNBC and a few other places.
But mostly I really just enjoy second guessing the Fed and keeping it simple.
Wishing you all continued success.
Analyst’s Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.
All investments have many risks and can lose principal in the short and long term. The information provided is for information purposes only and can be wrong. By reading this you agree, understand and accept that you take upon yourself all responsibility for all of your investment decisions and to do your own work and hold Elazar Advisors, LLC, and their related parties harmless. All model portfolio trades are hypothetical to show direction, conviction and timing. Performance excludes all relevant transaction costs. Opinions given are at this moment and can change rapidly after this is published. Elazar and its employees do not take individual stock positions to avoid front running and other potential customer related issues.
Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.