Even though last week was shorter due to the 4th of July celebrations, it was still eventful. On Wednesday afternoon, the Fed released minutes from its last FOMC meeting, which showed that the Committee is still committed to continue gradually increasing interest rates. On Friday, the Bureau of Labor Statistics released the nonfarm payroll data, which showed an addition of 222,0000 jobs in June (vs. expectations of 179,000) and an unemployment rate almost unchanged at 4.4%, slightly higher than the consensus estimate of 4.3%. In other news, at the end of the week, the G20 summit took place in Hamburg, Germany, where leaders of the world’s largest economies reiterated their commitment to promote free trade and open markets, to fight terrorism, and to reduce excess steel production, primarily in China, which led to low prices and pressure on other companies.
Amid these developments, the US stock market remained barely flat, with three indexes, S&P 500, Dow Jones Industrial Average, and NASDAQ Composite having registered slight appreciation in the low hundredths. However, some individual stocks saw more action. The team at TrackStar, the official newsletter of Investing Channel’s Intuition, analyzed the tickers that financial advisors searched for last week and compiled a list of 20 stocks that got more attention than others. Among the highlights is Tesla Inc (NASDAQ:TSLA), which ranked on the first spot amid a number of reports, including its second-quarter delivery figures. Advanced Micro Devices, Inc. (NASDAQ:AMD) ranked on the second spot, after PassMark, a provider of a benchmark utility, said that the chipmaker is cutting market share away from Intel Corporation (NASDAQ:INTL) with its new Ryzen chips. It was followed by AT&T Inc. (NYSE:T), which was in the spotlight on Thursday after CNBC’s David Faber reported that its $85 million takeover of Time Warner Inc. (NYSE:TWX) could close in 60 days.
Let’s get back to the stock that was the most searched last week, Tesla Inc (NASDAQ:TSLA). The stock lost 13.40% last week after the company reported disappointing second-quarter and first-half delivery figures. On Monday, the maker of electric vehicles said that it delivered more than 22,000 Model S and Model X vehicles during the second quarter, lower than the record figure of 25,051 vehicles a quarter earlier. Overall, the company delivered slightly more than 47,000 cars during the first six months of 2017, which was close to the lower-end of its own estimate of 47,000 to 50,000 units. Even though the second-quarter deliveries were over 50% higher compared to the same period of 2016, the number still trailed the average estimate of 23,655 vehicles, according to the Wall Street Journal. Nevertheless, with the annual jump in sales, Tesla managed to buck the trend among carmakers, including the Detroit “Big Three”, General Motors Co. (NYSE:GM), Ford Motor Company (NYSE:F), and Fiat-Chrysler Automobiles NV (NYSE:FCAU), which all reported declines on Monday.
Tesla Inc (NASDAQ:TSLA)’s sales report might have been taken more lightly if it wasn’t for the critical timing. The company started deliveries of its latest vehicle, the Model 3, last week, with the first 30 cars planned for delivery by the end of July. In its sales report, Tesla explained low sales by a “production shortfall” of battery packs, but assured that the issue had been resolved. Given that Tesla Inc (NASDAQ:TSLA) has faced supply problems in the past, some analysts are worried whether Elon Musk’s company will be able to deliver on its ambitious goals with the Model 3. The company plans to hit 500,000 cars per year in 2018, with the bulk expected to come from the much cheaper Model 3.
Analysts’ opinions were mixed after the release of the sales report. While Consumer Edge remained positive that Tesla Inc (NASDAQ:TSLA) will be able to deliver on its promises and reiterated its ‘Overweight’ rating and set a $385 price target, Goldman Sachs reaffirmed its ‘Sell’ rating and lowered the price target to $180 from $190, citing concerns that the Model 3 will fall short of the company’s targets.
In other news, Tesla Inc (NASDAQ:TSLA) also signed an agreement to build the largest battery system in the world in South Australia, which is facing major electricity issues. The 100 megawatt facility will be build using Tesla’s Powepack and Elon Musk promised to execute the project within 100 days, or it will be free. The deal will have big implications for Tesla Inc (NASDAQ:TSLA) as it might potentially attract other governments and even individual companies that might be interested in installing Powepacks to reduce energy costs. In turn, this could potentially result in a production ramp-up, lower prices and wider availability. What’s also important is that it will show skeptics that renewable energy can be reliable and affordable.
All-in-all, 2017 will be one of the crucial years for Tesla Inc (NASDAQ:TSLA). It will have to show the world that it is capable to be a full-on carmaker, which will depend on the Model 3 production (the demand is already strong, with over 300,000 people already having pre-ordered the vehicle), as well as other projects, including the development of its autopilot technology (Elon Musk promised that Tesla’s cars will be able to make a trip from New York to Los Angeles on autopilot) and its ride-sharing technology also projected for this year. In the renewable energy space it will have to deliver on the South Australia project and start deliveries of its solar roof (also expected in the second half of 2017).