After falling for 5 consecutive trading days, Tesla ushered in a strong rebound on March 9. As of the close of U.S. stocks on March 9, Tesla’s stock price soared 19.64% to $673.58 per share, the largest single-day increase in a year, and its market value increased by more than $100 billion to $646.5 billion.
What is the concept that the total market value increased by more than 100 billion US dollars in one night? This is equivalent to rebounding 2 Ford cars in one night. As of the close of US stocks on March 9, Ford’s total market capitalization was $50.2 billion, less than half of Tesla’s overnight increase.
Affected by the sharp rise in the market value of the “leading brother” of new energy vehicles, new domestic car manufacturers, Weilai, Ideal Auto, and Xiaopeng Motors also rebounded strongly. As of the close of US stocks on March 9, Weilai rose 17.44%; Xiaopeng Motors Up 11.33%; ideal car up 8.20%.
Extending the timeline to two months ago, Tesla, Weilai, Xiaopeng, Ideal, etc. have all staged the stage of a roller coaster of stock prices.
On January 8, 2021, Tesla’s total market value was 844.8 billion U.S. dollars. As of the close of U.S. stocks on March 8, Tesla’s total market value was only 540.4 billion U.S. dollars. That is to say, Tesla’s total market value was two In a month, 304.4 billion US dollars were evaporated. Weilai also fell from the highest point of US$66.99 to US$35.21 on March 8; the ideal fell from the highest point of US$47.70 to US$21.33 on March 8; Xiaopeng fell from US$74.49 to US$26.92.
Why did Tesla and other new energy car companies rebound strongly on March 9 after experiencing the plunge in stock prices? Are new energy car companies that have been abandoned by capital once again become an important target for large institutions?
In this regard, some insiders analyzed the “Deep Net”: “The strong rebound of new energy stocks after the sharp decline is related to the new round of economic stimulus plan in the United States. In addition, from the perspective of the business of new energy car companies, their financial data is good, and It gave investors confidence to a certain extent.”
A new round of economic stimulus plan in the U.S. landed
On March 6, local time, the U.S. Senate passed President Biden’s $1.9 trillion economic rescue plan for the new crown pneumonia. US Treasury Secretary Janet Yellen promised on the 9th that the funds for state and local government assistance in the new economic stimulus bill will be in place as soon as possible.
According to Yellen, the US$1.9 trillion expenditure is mainly divided into two parts. One is to use US$350 billion to make up for the fiscal revenue gap of state and local governments; the other is to issue a personal check of US$1,400 to the American people; A $300 unemployment benefit program per week, and the expansion of unemployment assistance to millions of Americans by September 6.
On March 9th, the Organization for Economic Cooperation and Development (OECD) stated that with the acceleration of vaccination and the launch of a huge new stimulus plan by the United States, the global economic outlook has become brighter. For this reason, the OECD has raised its economic growth forecast for 2021. It is estimated that the US economic growth rate will be 6.5% in 2021, compared with the previous estimate of 3.2%.
In this regard, some industry insiders analyzed the “Deep Web”, “The implementation of the new round of US fiscal stimulus plan will, to a certain extent, promote U.S. bond yields to continue to rise, but at the same time it will also support the U.S. stock market.”
From the perspective of the US 10-year Treasury bond yield, in the past three months, its yield has risen from 0.92% on December 16, 2020 to 1.608% on March 8, 2021.
New energy car companies are changing the dilemma of “selling one and losing one”
In addition to the launch of a new round of economic stimulus plans in the United States, Tesla, Weilai, Ideal, and Xiaopeng Motors have all recently released positive signals such as full-year profitability and a positive gross margin. This has also become a rebound of new energy car companies. Footnotes.
Recently, Tesla, Weilai, Xiaopeng, and Ideal all announced their financial reports for the fourth quarter and the full year of 2020. Among them, Tesla achieved full-year profit for the first time in 2020; Xiaopeng Motors achieved a positive annual gross profit margin for the first time; Weilai’s annual net loss narrowed year-on-year; Ideal Automobile achieved a positive quarterly net profit for the first time. From a business perspective, these money-burning new energy car companies are changing the dilemma of “selling one car and losing one”.
Look at Tesla first. According to Tesla’s fourth quarter and full-year 2020 financial reports released in February, the company’s GAAP net profit in the fourth quarter was US$270 million, a year-on-year increase of 157%; the company’s GAAP net profit in 2020 was US$721 million. For the first time, it achieved full-year profit.
From the perspective of Tesla’s gross profit and net profit margins, in 2020, Tesla’s gross profit margin is 21.02%, a record high since 2017; from the perspective of net profit margins, Tesla’s net profit in 2020 is 2.73%, which is the first realization The annual net profit margin is positive.
Ideal Auto’s 2020 annual revenue is 1.449 billion U.S. dollars, and its net profit is -23 million U.S. dollars. Although Ideal Auto is still at a loss for the whole year, compared with the loss of 350 million U.S. dollars in 2019, the annual loss has narrowed. From a single quarter perspective, in the fourth quarter of 2020, the ideal net profit of automobile was 16 million U.S. dollars, and for the first time, a single quarter net profit was positive.
Although Xiaopeng Motors has been at a loss, it also achieved the first full-year gross profit correction in 2020. According to the unaudited financial data for the fourth quarter of fiscal year 2020 and fiscal year 2020 released by Xiaopeng Motors, the company’s annual revenue was US$896 million, an increase of 151.8% from RMB 2.321 billion in 2019; the annual net loss was 4.19 Billion U.S. dollars, compared with a loss of 529 million U.S. dollars in the previous fiscal year, a narrowing. From the perspective of gross profit margin, for the whole year of 2020, the company’s gross profit margin was 4.6%, which is the first time that it turned positive in the whole year compared with -24.0% in the previous fiscal year.
Judging from the latest financial report data of Weilai Auto, although Weilai has neither achieved a single quarter turnaround, nor has it achieved a positive gross profit margin. However, starting from the second quarter of 2020, Weilai’s single-quarter gross and net profit margins have been on the rise.
In terms of vehicle deliveries, for the whole year of 2020, the deliveries of Weilai Automobile, Xiaopeng Automobile, and Ideal ONE were 43,728, 27,041, and 32,624, respectively, a significant increase from 2019.
New energy vehicles that have been abandoned have become “sweet steamed buns” again?
Affected by the previous plunge in new energy vehicles, many institutions have begun to reduce or even clear new energy stocks from 2020. However, judging from the strong rebound of Tesla and other new energy companies on March 9, it may be possible that new energy vehicles will become a success. The “fragrant steamed bun” of capital.
Since 2020, both Weilai and Tesla have had major shareholders reducing their holdings.
On September 18, 2018, when NIO was listed in the United States, Hillhouse Capital became its second largest institutional investor with a 7.5% shareholding ratio. In the third quarter of 2019, Hillhouse Capital reduced its holdings of Weilai to 13,368,900 shares, a reduction of 68.12%. On December 30, 2019, according to the documents submitted by Hillhouse Capital to the U.S. Securities and Exchange Commission (SEC), Hillhouse had all liquidated the shares of Weilai. In the third quarter of 2020, Hillhouse once again increased its position in Weilai, but in the fourth quarter, it chose to clear its position again.
Baillie Gifford & Co, the Scottish investment fund, Tesla’s second largest shareholder, has been reducing Tesla’s shares since mid-2019. According to its submission to the US Securities and Exchange Commission, as of August 31, 2020, it held 4.25% of Tesla’s shares, which is lower than the 7.6% shareholding ratio at the end of 2019.
In the past year, due to heavy holdings in technology stocks such as Tesla, ARK’s flagship fund, ARKK, has risen 136%, becoming a star fund on Wall Street. But as Tesla’s stock price began to pull back in February, ARKK plunged 25% in 14 trading days. However, the fall of the fund did not affect the confidence of “female Buffett” and ARK-Invest CEO Casey Wood in Tesla. She publicly stated that she is still firmly optimistic about Tesla. As of March 8, 2020, Tesla is still ARKK’s favorite, holding 3,572,503 shares, accounting for 9.99% of the total fund, ranking first.
Casey Wood, CEO of ARK-Invest
Casey Wood is optimistic that new energy car companies are just a microcosm of the latest developments in capital. Previously, major shareholders of Weilai and Ideal Motors also increased their holdings of new energy vehicle stocks.
According to wind data, Wang Xing, the founder of Meituan, the largest shareholder of Ideal Auto, held 390,055,377 shares on August 3, 2020. By December 31, 2020, this number of shares will change. For 391,434,687 shares, 1379310 shares were increased during the period.
Baillie Gifford & Co, Weilai’s second largest shareholder, is also increasing its holdings in Weilai’s stock. According to wind data, on July 8, 2020, it held 101,370,431 shares of Weilai, accounting for 8.31%. But by March 2, 2021, Baillie Gifford & Co held 107,907,768 shares of Weilai, during which it increased its holdings of 6,537,337 shares.
Affected by this, Pierre Ferragu, an analyst at investment company New Street Research, has raised Tesla’s share price from “neutral” to “buy”, and raised its target price from US$578 to US$900.