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.
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*Figures correct as of Feb 28th 2023.
Past performance does not guarantee future results. Capital at risk when investing.
This content is for educational purposes only. Shares does not provide investment advice. If you are unsure about anything, please seek advice from an authorised financial advisor.