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The Week Ahead - Apple and Tesla share splits

by , 01 September 2020
The Week Ahead - Apple and Tesla share splits
Some big-name companies announced stock splits and today is an important day for investors.

Apple (APPL) shares split four for one on Friday close. This means it will start trading today at 25% of its closing price of $499.23 on Friday. This is the fifth time its split in 33 years. If Apple never did these share splits, 1 share would be changing hands at almost $29,000, from an IPO price of $22 in 1980.

Tesla (TSLA) shares have split five for one, also on Friday close. Its shares will trade at 20% of Friday's price of $2,213.40. This is most likely the nail in the short sellers' coffin as it could see renewed interest from investors. Buyers could push the share price higher causing its valuation metrics to stay stratospheric. Its market cap is larger than Ford, GM, VW and Fiat Chrysler.

Tesla closed Friday on a trailing PE of 1080. And its Forward PE is 333. But this doesn't mean it won't continue to rally, the company is innovating as fast as its share price is rising.

Industry growth research firm IHS Markit predicts $12.3 trillion in revenues from this newest growth industry
This industry is about to go into orbit…
Research firm Markit estimates this $1.3 billion industry will explode in revenue into $12.3 trillion.
$12.3 trillion!
To put that into perspective... That’s 24 times more money than Walmart makes in a year.
And 45 times more than Apple. In fact, it’s 11 times more revenue than Amazon has made in its enture existence.
It’s no wonder Forbes called it the “Holy Grail”. And MIT Technology Review claimed it will bring about a “technological paradigm shift similar to the jump from the typewriter to the computer.”
If you would like to find out what this this opportunity is, go here!
US Fed ignites rally that could last until year end
Fed Chair Jerome Powell has ignited what could be the start of an early year end rally. At the Jackson Hole symposium, the Fed has indicated it will allow inflation to breach 2% without taking action if it means more people will remain employed and join the workforce in America. This is significant as it highlights the potential for the US to see growth without raising interest rates too quickly. This will see risk assets rise as investors look past negative news events to acquire assets with the most potential to beat inflation in the long run.
Rand charges back below R17.00
With the risk on trade following the Jackson Hole symposium, the Rand rallied back to the support level at R16.40, if it breaks through this level, we could see a swift rally below R15.50. Investors and importers looking to buy FX should keep an eye on a break below to ensure they get a better rate.
A concrete strategy to profit from this month’s
earnings season!
We’re in the midst of one of the most important set of earnings this year.
As the economies are re-opening and businesses are starting to trade again – things are starting to look good for earnings.
Now I’m not saying, we can expect great results.
But we can expect results to pick back up, as lockdown restrictions are dropping.
Today, Trader X wants to share his strategy that will show you how to secure profits from offshore opportunities during the earnings season.
Recent Ideas Update…
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MTN rally loses steam at R70
MTN has pulled back after tagging the R70 level last week. Our target price remains at R75, and it could be raised higher. Management and the board have taken the right steps. A strong foundation has been set and earnings over the next 12 months should be robust and grow steadily. This is a longer-term opportunity for your portfolio.
BidCorp bounces on results closing out our short position for a 95% gain on Margin
Bidcorp traded at our trailed stop loss as it came within cents of our take profit target. We banked R27.50 per share. And it rallied all the way above our entry level.
Our other ideas in EOH, BLU and DGH are still at below the entry levels suggested last week. We see these as good longer-term value plays for a portfolio.
Here’s the entry levels…
Buy Blue Label below R3
Buy EOH below R5.50
Buy Distell below R77.50
See you next week.
Gavin McCarter,
Contributing Editor, Money Morning
P.S. In case you missed it… Francois Joubert has released his TOP 5 value buys on the JSE, you can claim a copy of his new briefing here!

The Week Ahead - Apple and Tesla share splits
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