1 Stock to buy, and 1 stock to absolutely avoid this week: Tesla, PayPal

Shares on Wall Street plunged on Friday, with the index suffering its worst one-day loss since October 2020, on growing fears over the Federal Reserve’s plans to .

The week ahead is set to be another busy week, with new results from notable tech companies like Apple (NASDAQ:), Microsoft (NASDAQ:), Amazon (NASDAQ:), Alphabet (NASDAQ: ), Meta Platforms (NASDAQ:) , Twitter (NYSE:), Intel (NASDAQ:), Qualcomm (NASDAQ: ), Spotify (NYSE:), Pinterest (NYSE:), and Robinhood (NASDAQ:).

The earnings agenda also includes other leading companies, such as Exxon Mobil (NYSE:), Chevron (NYSE:), McDonald’s (NYSE:), Boeing (NYSE:), Caterpillar (NYSE: , Ford Motor (NYSE: :, General Motors (NYSE:), United Parcel Service (NYSE:), Coca-Cola (NYSE:), Visa (NYSE:), Mastercard (NYSE:) and General Electric (NYSE:).

Add to that the key economic data on the agenda, including the latest stock market report. (PCE), and the week ahead will be eventful.

Regardless of where the market is headed, we highlight two high-tech stocks below: one likely to be sought after, the other likely to lose appeal.

Remember, however, that our time horizon is only for the week ahead.

Stock to buy: Tesla

As the stock market struggles, Tesla (NASDAQ:) stock is holding up reasonably well, especially compared to other high-growth companies with very high valuations.

We expect this trend to continue in the coming days as investors react to a number of developments around the Elon Musk-led electric vehicle maker.

Tesla reported earnings growth and growth in its latest financial results last week, easily beating analysts’ estimates for both profit and loss for the first quarter of 2022.

For the period ending March 31, Tesla reported earnings of $3.22 per share and revenue of $18.76 billion. Both numbers are the highest in EV company history, reflecting a jump in vehicle deliveries, an increase in average selling price (ASP) and growth in other parts of the business.

More impressively, Tesla also posted record automotive margins of 32.9%, more than double those of incumbent companies such as Ford (NYSE:) and General Motors (NYSE:).

During the company’s earnings conference call, CEO Elon Musk said Tesla remained confident in its ability to grow at least 50% from 2021 numbers.

Meanwhile, in another interesting development, Musk said on Twitter over the weekend that he confronted Microsoft co-founder Bill Gates about holding a $500 million short position against Tesla. .

Musk Tweet

Musk Tweet

This could potentially trigger a short sale on Gates and boost Tesla shares in the process.

TSLA D1

TSLA is down just 4.9% year-to-date and ended Friday’s session at $1,005.05. At current valuations, Tesla has a market cap of $1.04 trillion, making it the world’s largest automaker, bigger than names like Toyota (NYSE:), Daimler (OTC:), GM, Honda (NYSE:) and Ford.

Stocks for sale: {{0}PayPal}}

PayPal Holdings (NASDAQ:), which has seen its stock steadily tumble to new lows in recent sessions, is set for another volatile week as the market expects disappointing financial results from the service provider. struggling digital payments.

Shares of the San Jose, Calif.-based company have fallen 54% year-to-date on a plethora of negative news, including concerns about a slowdown in its core business, growing competition in the mobile payment processing industry, as well as a continued slump in many blue-chip tech stocks.

Sentiment towards the fledgling company – which closed its Russian services in the first week of March – soured further earlier this month after chief financial officer John Rainey quit the company. to join Walmart (NYSE:).

PYPL closed at $86.03 on Friday, a level not seen since March 2020. At current valuations, PayPal, which is around 72% below its all-time high of $310.16 reached in July 2021, has a market capitalization of $99.9 billion.

PYPL D1

Earnings and revenue growth, which decelerated sharply at PayPal, is expected to slow further when the fintech giant releases first-quarter numbers on Wednesday, April 27 at 2 p.m. PST.

Consensus calls for earnings per share of $0.87, down nearly 29% from earnings per share of $1.22 a year earlier. Revenue is expected to increase approximately 6% to $6.4 billion.

Beyond the top and bottom numbers, investors will pay particular attention to PayPal’s active account additions and growth in total payment volume (TPV), or the value of all transactions processed on the platform of the e-commerce company. Both of these key indicators fell short of their targets in the last quarter.

Management’s outlook for the current quarter and beyond will also be the focus. We believe PayPal is likely to reduce its earnings and sales growth outlook for the coming months as it continues to struggle with unfavorable trends in consumer spending and customer demand in the current environment.

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