US stocks continue to trend higher but in a mixed fashion. The Dow gained 126 points on heavy trade to 25,628 while the NASDAQ fell slightly on lighter trade. All of this is very constructive trading action.
Shares of Seattle based real estate company Zillow were hammered after an earnings report that noted a 22% revenue gain and a 225% jump in net income before items. The revenue figure was in line with expectations while the bottom line was better than expected. Shares of the company however fell hard when Zillow announced it was purchasing a mortgage lender called Mortgage Lenders of America. The news seemed to catch the gurus by surprise and they promptly downgraded the stock. Zillow did not disclose terms of the deal but said it hopes to close in 6 months. Zillow also gave weak forward guidance. Shares were down 14%.
Shares of Tesla went on a wild ride today after several news items came out. One was that the Saudi Sovereign Wealth fund disclosed it had purchased about $2 billion worth of Tesla. Then came a series of tweets from Elon Musk saying that he would take the company private at $420 per share. This news caused shares to initially jump about 6% and trading was halted briefly as people tried to figure things out. When trading resumed shares shot higher to close up $40ish at $379. One thing is for sure and that is that short sellers took it on the chin losing about $800 billion in the process. We will see how this goes but Musk did post it on the Tesla web site that the company will go private! Apparently, Elon is tired of quarterly conference calls and how market speculators, regulators, gurus, second guessers etc. all make it harder to focus on running the company.