Stocks on Wall Street ended their final trading session of 2021 lower on Friday, with the S&P 500 capping off a record-setting year despite risks related to the Federal Reserve’s tightening path and the ongoing COVID health crisis.
The week ahead is expected to be busier than usual, with all eyes on Friday’s U.S. employment report, plus release of the Minutes from the Federal Reserve’s most recent policy meeting also on the agenda.
No matter which direction the market goes as we start the new year, we've highlighted one stock likely to be in demand in the coming days and another which could see fresh losses.
Remember though, our timeframe is just for the week ahead.
Stock To Buy: Tesla
After scoring a gain of roughly 50% in 2021, Tesla (NASDAQ:TSLA) shares look set to kick off the new year right where they left off, as the electric vehicle maker gets set to report record fourth quarter delivery figures. Q3 saw Tesla's revenue reach $13.76 billion, slightly below analyst estimates, but, EPS soared, coming in at $1.86, beating the $1.62 estimate.
While the Elon Musk-led company usually reveals the all-important numbers on the second day of a quarter—regardless of weekends—it is possible they could arrive on Monday morning due to the New Year holiday.
The EV pioneer company is expected to have shipped 276,900 vehicles over the three months ending in December, improving nearly 15% from the preceding quarter and up 53% from the same period last year.
That includes 261,400 Model 3 and Y vehicles and 15,500 Model S and X vehicles, as sales boom despite pandemic-related supply-chain issues and a global chip shortage.
If confirmed, the Q4 numbers would represent a new all-time high for the world’s most valuable automaker. The previous high was notched in Q3 of 2021, when Tesla delivered 241,300 vehicles.
Additionally, the EV maker—which recently moved its headquarters from Silicon Valley's Palo Alto, California to Austin, Texas—will also release full-year delivery figures. After shipping a total of 499,550 vehicles in 2020, analysts expect Tesla to report 2021 annual deliveries north of 900,000 units.
TSLA shares ended Friday’s session at $1,056.78, roughly 15% below their all-time high of $1,243.49 touched on Nov. 4, giving the EV company a market cap of $1.06 trillion.
At current valuations, Tesla is the world’s largest automaker, bigger than names such as Toyota (NYSE:TM), Daimler (OTC:DDAIF), General Motors (NYSE:GM), Honda (NYSE:HMC), and Ford (NYSE:F).
Stock To Dump: Didi Global
After plunging 65% in 2021, shares of Didi Global (NYSE:DIDI), the largest ride-hailing firm in China, look set to remain under pressure as investors fret over the lingering impact of several negative factors dogging the tech company, often referred to as the ‘Uber of China.'
DIDI stock—which has fallen nearly 35% in the last month—sank to an all-time low of $4.74 on Friday, before closing the session at $4.98. It now stands more than 70% below its all-time high of $16.89 touched on July 1.
At current levels, the Beijing-based ride-sharing service, which made its debut on the NYSE on June 30 after going public at $14 per share, has a market cap of roughly $24 billion.
Sentiment on the out-of-favor name has taken a hit as investors dumped Chinese tech shares due to an ongoing months-long campaign by Chinese authorities aimed at reining in the influence of the country’s thriving Internet companies.
Indeed, Didi—co-founded in 2012 by former Alibaba (NYSE:BABA) employee Will Wei Cheng and backed by SoftBank Group (OTC:SFTBY)—reported dismal third-quarter financial figures last week, hurt by falling revenue and higher regulatory costs over its handling of customer data.
China’s ruling Communist Party has placed severe restrictions on Didi in response to its decision to hold its IPO in New York earlier last year, ordering the ride-hailing giant to remove its app from online app stores.
Ultimately, Didi announced in December that it will delist from the NYSE and pursue a listing on the Hong Kong Stock Exchange instead, a move aimed at appeasing Chinese regulators. According to reports, Didi aims to file for the Hong Kong listing by the end of April and list by June.