Three Stocks: Tesla, Apple, and Lennar

Tesla

Telsa (TSLA) stock ran higher by more than 9% today after it reported better-than-expected Q2 delivery numbers.

Tesla shares started the day higher by 4% in pre-market trading after it reported 440K deliveries.  Analyst’s estimates for the delivery number was 436K.  The company also deployed 9.4 GWh of energy storage products in Q2, the highest quarterly deployment for the company.

There were no analyst changes on the stock following the announcement, but it should be expected that we will see analysts reassessing their outlook for the stock over the next few weeks as the company’s earnings report approaches on July 17.

The recent rally in Tesla stock has pushed shares 11% higher than their 20-month moving average.  That long-term trendline is the line between a long-term bull market trend for a stock.

This (July) marks the first month that Tesla shares have traded above their 20-month moving average since January.

The company’s upcoming earnings report will be a critical “show me the money” confirmation for investors that have discounted the company’s recent slowdown as well as consumer behavior towards large ticker discretionary purchases.

Like Apple, today’s move puts Tesla shares into a technically overbought reading that suggests share prices could use a consolidation or healthy correction after their breakneck speed rally

TSLA Price Chart

Apple

Apple’s (AAPL) post-earnings and WWDC rally continued today as the stock is set to post its first close above $220.

The large cap technology company is one of the best performers in the Nasdaq 100 today as the stock closes the day trading 1.6% higher.  Volume was light for the trading day given the holiday shortened week.

Apple’s rally is pressing through a crosswind of comments from analysts.

On the bullish side the stock received positive mention in a Barron’s article last weekend alongside fellow “Mag Seven” leader Alphabet (GOOG).

This morning, an analyst at UBS that covers Apple commented that "In the month of May, iPhone "sell-through" remained soft declining 2% year-over-year” in referring to Apples’ sales in China.

Options traders are beginning to reflect their optimism for the company as the August options have seen increased activity from the $225 to $250 price range.  That option activity would suggest that options investors are anticipating an improved earnings report from the company on July 24.

The price chart for Apple is the only thing that may cause some concern, though not enough to stop its ascent.  Apple’s rally has now taken the stock into an overbought condition.  That suggests that the stock is likely to see a consolidation or a healthy correction in the near term.

Aside from that, expect Apple stock to continue its bullish run higher as technology stock historically see strong performance in the month of July.

AAPL Price Chart

Lennar

Lennar (LEN) shares tumbled by almost 2% today as the homebuilder’s shares were the target of three downgrades from Wall Street.

Analysts from Raymond James, Citigroup and Wedbush all downgraded Lennar stock ahead of the opening this morning.  The worst of the downgrades came from Wedbush’s analyst, who dropped the stock from a Neutral to Sell.  That analyst’s new price target for the stock is $144 (the current price of the stock).

The downgrades fell just weeks after Lennar released their latest earnings report.  That report was met with selling pressure after showing a drop in year-over-year revenue growth.  Lennar’s management also guided third quarter earnings per share lower in anticipation of a continued slowdown in the housing market.

Housing stocks have been fighting a trend of higher interest rates affecting the number of potential buyers coming into the market for new homes.

Today’s move takes Lennar stock below its 200-day moving average for the first time since November 2023.

That short dip below this key trendline was reversed quickly as investors were eyeing the possibility that the Fed may have started lowering rates as early as February of this year.  The Fed is set to meet on July 30 with a rate decision on July 31.

Lennar’s short-term price target is $130 based on the stock’s trend analysis.

LEN Stock Price