To The Moon

Hello everyone! Today i want to share some trading ideas with you!

1.

Ever heard of the PEG ratio? It's Peter Lynch's go-to metric that if a score is <1.0, it hints at a bargain, while >2.0 might be a bit pricey -- let’s see how Big Tech stacks up as we begin Q2 earnings 🧐

2.

$Tesla Motors(TSLA)$ reports after the close, and here's what I'll be watching 🧐

Optimus Development

• A significant new addition to Tesla's innovative portfolio is the development of the Optimus robot, which Elon Musk recently announced is slated for low production by 2025 and high production by 2026.

• Optimus, expected to be utilized internally by Tesla as early as next year, represents a leap into robotics that could revolutionize labor and operational efficiency within Tesla’s manufacturing processes.

• It would be great to learn on the earnings call about the initial integration of Optimus into Tesla’s ecosystem, its production timeline, and the expected financial and operational impacts of this groundbreaking development.

Autonomous Driving

• The Q2 earnings call is anticipated to shed light on Tesla’s progress with its Full Self-Driving (FSD) capabilities and the Robotaxi service. The delay in the Robotaxi rollout, while initially a setback, has allowed Tesla additional time to refine and enhance its autonomous technology.

• Updates about the integration of FSD into the Robotaxi design -- which is central to Tesla's strategy in autonomous driving -- will be of interest. Tesla's vast real-world driving data fuels its AI, making continuous advancements possible and setting Tesla apart in the race towards fully autonomous vehicles.

• Elon Musk's vision for transforming Tesla into a leader in mobility-as-a-service (MaaS) will also be a focus. With Tesla's autonomous tech, the company is poised to dramatically reduce transportation costs, making mobility more accessible and affordable. The introduction of the Robotaxi and potential partnerships with existing ride-hailing services could significantly expand Tesla’s market reach and influence.

Energy Storage

• Tesla's energy storage segment is likely to be a focal point of the Q2 earnings, following its impressive growth. In 2023 and 2024, this segment's contribution to gross profit notably rose, accounting for less than 8% of revenue in Q1 but potentially reaching or exceeding 14% if revenue doubles sequentially as anticipated

• Last quarter, energy storage constituted 10.9% of Tesla’s $3.69 billion in gross profit, a significant increase from 3.7% in Q1 2023. The segment boasts a higher margin profile than Tesla’s automotive operations, achieving over a 24% gross margin in the first quarter. Despite this impressive growth, the expected surge in Q2 revenue will likely not substantially impact EPS, due to the automotive margin stabilizing around 18%

• Additionally, the role of energy storage in Tesla's long-term strategy to create a more sustainable energy ecosystem will be examined, with expectations for clear plans on how Tesla intends to leverage its tech capabilities to maintain leadership in this high-potential market.

China Market

• Tesla's strategy and performance in China will be another significant topic in the Q2 earnings report. Given the dynamic and highly competitive nature of the Chinese EV market, Tesla is expected to outline how it is adapting its business strategy to address local competition and regulatory challenges. This includes detailing efforts to optimize its Shanghai Gigafactory's output and innovations specific to the Chinese market

• Interest in Tesla’s customer engagement and marketing strategies in China, especially how Tesla plans to compete with local EV giants like $BYD Co., Ltd.(BYDDY)$ and $NIO Inc.(NIO)$ , will be high. Furthermore, Tesla’s approach to managing supply chain issues, tariffs, and geopolitical tensions that could affect its operations will be critical.

Earnings Estimates

Q2 2024

• Sales $24.7B -- down 1% YoY

• GAAP EPS $0.48 -- down 38% YoY

FY Outlook

• Sales $99.4B -- up 33% YoY

• GAAP EPS $2.18 -- down 49% YoY

3.

$Snowflake(SNOW)$ has partnered w/ $Meta Platforms, Inc.(META)$ to host the Llama 3.1 collection on its Cortex AI platform -- streamlining the development of AI applications.

This integration solidifies Snowflake’s position as a leader in seamlessly merging AI w/ cloud data services at a lower cost & complexity.

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