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Tesla’s Stock Nears A Tipping Point, Plus Apple Continues On Its Path To $300
MICHAEL KRAMER AND THE CLIENTS OF MOTT CAPITAL OWN SHARES OF AAPL, TSLA, V, MA
First a big thank you to MarketWatch for using yesterday’s blog as their call of the day!
It was a pretty dull day, and stocks were working nicely higher. Then news hit $200 billion worth of tariffs for China may be implemented next week. And well as one would expect the market sold off, finishing the day down about 45 bps on the S&P 500. Maybe it’s my imagination, but isn’t this like the same thing that we have talked about for months now? Should any of this be a shock at this point? Stupid if you ask me. They, as in the quants and HF’s, need to start reprogramming the Algo’s so that when the Algo’s scrape for headlines, the word tariff doesn’t trigger a sell-off. In my opinion, tariffs have been well telegraphed, and priced into the market. Today’s action was likely nonsense, and I doubt it last.
The S&P 500 stopped falling were it should around 2900.
Apple surged to $225 before pulling back some. The stock got a big boost around lunchtime after the company announced its iPhone unveil date to be September 12. Although Warren Buffet made some positive comments on CNBC about Apple, which doesn’t hurt either. The stock continues to act very well, and at this point, there may be much more upside. I wrote for Investopedia that some traders in the options market are looking for the stock to rise to about $250 by January.
Again, as I have said before, I believe Apple to be worth about 20 times 2020 earnings of $14.97 per share, which puts the stock at roughly $300. I base this off a thesis that as the services revenue continues to grow and becomes a big piece of total revenue, the stock will get further multiple expansion. Again, I spoke about this several weeks ago in the member section. Why Apple May Rise By 50%
Amazon hit a high of just a bit more than $2,025 today, and now that will become a level of resistance for the chart, while the uptrend line becomes support around $1,950. No further updates on Amazon at this point.
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Tesla is finding support right where it should again, on the uptrend, using the Log chart. This has been a strong uptrend. As the trendline and resistance at $388 continue to come together, the closer the day comes until the stock sees a significant breakout, above $388. The relative strength index is still trending lower, but there are signs that trend is now starting to shift, suggesting a bullish divergence.
Interesting Tesla is also trading at nearly its lowest level on a one-year forward price to sales ratio in some time.
Fundamental Chart data by YCharts
AMD continues to feel pressure, and the stock is retesting resistance and looks to be failing at it. I still think the stock works its way lower towards $21.
Square continues to rip higher, and while there is no doubting Square is a strong growth story. Shares are now overbought and are trading at a very high PE, for that growth. But two companies that you need to pay attention or at least consider if you like Square are Visa and MasterCard. After all, what good is Square without Visa and MasterCard? Anyway, I talk about the importance of these two stocks in the e-commerce ecosystem and a whole bunch more today in the member video. 2 Stocks To Consider If You Like Square
Michael Kramer is the Founder of Mott Capital and the creator of Reading the Markets.
2 Stocks To Consider If You Like Square
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Mott Capital Management, LLC is a registered investment adviser. Information presented is for educational purposes only and does not intend to make an offer or solicitation for the sale or purchase of any specific securities, investments, or investment strategies. Investments involve risk and unless otherwise stated, are not guaranteed. Be sure to first consult with a qualified financial adviser and/or tax professional before implementing any strategy discussed herein. Upon request, the advisor will provide a list of all recommendations made during the past twelve months. Past performance is not indicative of future.
#Apple #tesla #square #visa #mastercard #sp500
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