This week, Tesla’s Investor Day fell flat, Seagen talked takeovers and Zoom’s earnings definitely weren’t on mute. Grab a spoon folks, it’s time to dig into The Weekly Scoop.
Elon-gated chaos for Tesla as stock slips 5% 🏎
The ‘Master’ Plan: On Wednesday evening, Elon unveiled Tesla’s so-called ‘Master Plan 3’. But the market’s reaction? Underwhelmed.
Short on details: Investors had been expecting to hear about new plans for Tesla’s Cybertruck, Model 3 and robotaxis. Instead, much of it was spent talking about previous achievements.
Gigafactory in Mexico: Tesla is going to be building a gigafactory in Mexico. Unfortunately, the President of Mexico beat Musk to that announcement earlier this week.
Seagen surged 12% thanks to talks of a Pfizer takeover 💊
$30 billion buyout: The cancer-focused biotech, Seagen, is reportedly in talks with global pharmaceutical company, Pfizer, about a whopping $30 billion takeover.
Excited investors: When a company has takeover talks, its stock price often goes up due to increased demand from investors who anticipate a higher price if the acquisition is successful.
2nd time lucky: Current Seagen investors will be wary though, as last summer, buyout talks with Merck (MRK) fell through. A price couldn’t be agreed upon, but clearly Seagen is keen to sell.
It isn’t all doom and gloom for Zoom as stock jumps 8% 🖥
Positive earnings: Zoom shares jumped 8% as the video chat company reported better-than-expected results in its 4th quarter earnings on Monday, 27th Feb.
Up $20 million in revenue: Zoom reported $1.12 billion vs. the $1.10 billion expected by analysts. The company is still experiencing a major slowdown in growth since the pandemic, but investors will just be pleased to see the company outperform analyst expectations.
Fancy features, fewer staff: In Q4 Zoom added email and calendar services, alongside a customer service chatbot. Earlier this month, Zoom also cut its costs by laying off 1,300 employees (15% of its workforce). Will Zoom stock continue to zoom?
What have we learnt this week? 🤓
Investor confidence can move stock prices: Tesla’s Investor Day was a chance to increase investor confidence. But when Musk opened by saying it was a day for “anyone invested in earth”, it didn’t go down well. Why? Shareholders wanted to hear about market share; and they didn’t.
Potential takeovers excite investors: A takeover can increase the demand for a stock and gives investors a clear ‘exit strategy’ when they want to sell. Often, the company who’s buying also pays a premium on the shares to win the appreciation of the current company's shareholders.
Despite reduced growth, a positive earnings call can make a difference: Zoom is still navigating life after a huge surge in business thanks to the pandemic. While it's still experiencing a decline in growth, better than expected revenue and a clear company vision did have investors excited this week.
*Figures correct as of Feb 28th 2023.
Past performance does not guarantee future results. Capital at risk when investing.
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