In addition to Shaquille O'Neal telling TheStreet his investment tips, Friday was a pretty interesting day.
Why Nike Fell
Nike, RealMoney's stock of the day, was "indicated -4.5% after hours (Thursday) against high buy-side expectations," wrote analysts at Morgan Stanley early Friday morning, implying what Nike would do at Friday's market open. The analyst's buy-side point shows that investors and sell-side analysts can often have divergent opinions on near-term stock movements. Don't rely on sell-side research alone. The buy-side, or investment funds, which actually move the market, may have different views.
It seems that investors were looking for a better earnings print than they received.
Nike also showed strong signs of sustainable growth, as a gross margin expansion of 130 basis points year over year to 45% was "driven by higher average selling prices," according to Nike. The sell-side consensus was for a gross margin expansion of 75 basis points. And still, the stock was sold off Friday.
Plus, while analysts at Morgan Stanley and JPMorgan were calling for an earnings beat, investors were buying up the stock, clearly on the basis of even higher expectations than analysts had. "Our only worry heading into the earnings print was very high investor expectations," Morgan Stanley wrote.
Also of note, North America sales, which represent about 40% of revenue, were $3.81 billion, below estimates of $3.89 billion.
On a day in which the yield curve inverted and the broad indices posted large losses (S&P 500 down 1.75%), something else happened. Tesla (TSLA - Get Report) , which just received a positive review from a top analyst this week, got downgraded by another. Cowen & Co. analysts downgraded Tesla "to reflect the likely softer deliveries in 1Q19; pricing changes for all of the company's vehicles; and margin pressure that we believe is a likely result of both volume and pricing," the analysts wrote in a note out Friday morning. Tesla shares fell 3.43% to $264.62 Friday.
This comes just after WedBush Securities said, after visiting a Tesla giga factory, battery production looks strong, which would indicate Tesla can hit delivery targets.
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