Daily Brief - Not every stock was crushed yesterday (Oct 5, 2021)

Tech stock giants were brought to their knees in the wave of Nasdaq selling yesterday. Well, except one. On a day when the index closed down over 2%, one stock closed solidly up: TSLA!

The electric vehicle pioneer on Saturday reported a record quarter with deliveries up more than 70% from a year ago. Another quarter, another record. This was all the more impressive given the difficult backdrop for car manufacturers. Tesla is growing rapidly despite a global automotive semiconductor shortage that is roiling car production across the globe.

The company delivered 241,300 vehicles in the third quarter of 2021, up from 140,000 delivered in the third quarter of 2020. This was sharply above expectations for 225,000 to 230,000 among Wall Street analysts.

The market is adjusting to the new reality that Tesla is now reaching an annual production rate of almost 1 million electric cars.

The results were good enough for the stock to get a boost Monday. The bigger reaction to strong deliveries typically comes in the weeks following the release of the figures. Quarterly earnings are usually announced 3-4 weeks after the deliveries are reported. This was a good period for the stock: it historically outperformed the market six out of the past eight times during the window between reporting deliveries and reporting quarterly earnings.

In fact, TOGGLE highlighted Tesla already back in July, noting that trend could start to turn up, and then again in August after the brief sell-off retested the support levels in the stock price.

This was good news for Tesla investors. The bar for earnings in a few weeks has definitely been set higher!