Here’s Why $TSLA Sank Despite Record Profits | The Daily Peel | 10/21/22

Oct 21, 2022 | Peel #321

Market Snapshot

Elon’s been spending a lot of time with lawyers lately, but that didn’t prevent Tesla from notching a record quarterly profit in Q3.

Yet it wasn’t enough to prevent the stock from cratering. To earn its lofty valuation, it needs to ramp up vehicle deliveries ASAP.

In other news, U.S. residential real estate is continuing its plunge, mortgage rates are a hair below 7%, and bond yields are on the rise.

Let’s get into it.

Banana Bits

Macro Monkey Says

Meme of the day

What's Ripe

What's Rotten

Allstate ($ALL) ↓ 12.90% ↓

• Shares were plunging after the company announced a near billion dollar loss in the quarter.
• Hurricane Ian caused millions in claims, and inflation has ratcheted up costs for repairs that insurers like $ALL are on the hook for.

Tesla ($TSLA) ↓ 6.65% ↓

• Elon’s full-time job seems to be sparring with Twitter these days, but he’s still got a side hustle as top boss at Tesla.
• Despite beating EPS, it missed its top line target. When you’re paying 71 times earnings for the privilege of holding the stock, blowout quarters need to be the norm.

Data Peel

Source

Thought Banana

Private Jets Go Mainstream — First-class airline travel is great, but the legroom and free champagne doesn’t always cancel out the hellish experience within many U.S. airports.

Private jets have historically been reserved only for the 1% of the 1%, but now the merely rich are starting to enter the market.

• 2021 had the highest number of private jet flights on record
• Financial assets have largely struggled this year, but those at the top have still seen their wealth balloon over the last several years
• The silver lining is that there are regular people that benefit from this hot corner of the economy—engineers who design and build these things, private flight attendants, etc.
• But it’s not a good look when most of the country is bracing for recession while those at the tippy top buy more and more toys

The big question: If private jet demand stays elevated amid a broad-based recession, will U.S. citizens demand a billionaire’s worst nightmare—a wealth tax?

Banana Brain Teaser