Stocks To Watch Thursday: Google, Tesla, and Chipotle
Alphabet’s (GOOG) strong quarterly results might not outshine investor worries. GOOG stock gained nearly 2% in after-hours trade after the company said it would spend $85 billion in capital expenditures this year.
The spending is good news for artificial intelligence suppliers like Nvidia (NVDA). The race to stay ahead against ChatGPT, which has Microsoft’s (MSFT) support, or Alibaba’s (BABA) Qwen-VLo models, requires Alphabet to hike its spending.
In the second quarter, Alphabet posted an EPS of $2.31 a share. Revenue increased by 13.8% Y/Y to $96.43 billion.
Tesla (TSLA) might open lower this morning. It posted Q2 non-GAAP EPS of $0.40. Revenue fell by 11.8% Y/Y to $22.49 billion. TSLA stock still has meme-like qualities, since the share price is not falling by much on the weak results.
As expected, the company touted autonomy as “the story” of its future. Still, CEO Elon Musk said the autopilot production release is only “several months behind.”
In the food sector, Chipotle (CMG) will open down by around 10%. Comparable sales fell by 4.0%, despite new store openings that pushed total revenue up by 3.0%. Margins are also falling, down by 150 bps Y/Y to 27.4%.
Chipotle’s restaurant experience is worsening. Customer service, cleanliness, and food quality all need to improve. Otherwise, comparable sales declines will accelerate.
