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1 Stock To Buy, 1 Stock To Dump When Markets Open: Tesla, AMC Entertainment

By Investing.com (Jesse Cohen/Investing.com)Stock MarketsApr 04, 2021 06:11AM ET
www.investing.com/analysis/1-stock-to-buy-1-stock-to-dump-when-markets-open-tesla-amc-entertainment-200571102
1 Stock To Buy, 1 Stock To Dump When Markets Open: Tesla, AMC Entertainment
By Investing.com (Jesse Cohen/Investing.com)   |  Apr 04, 2021 06:11AM ET
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Stocks on Wall Street extended their rally last week, with the S&P 500 climbing above the 4,000-level for the first time in history, amid ongoing optimism over the economic outlook.

S&P 500 Weekly Chart
S&P 500 Weekly Chart

Between another batch of important economic data, as well as the release of the minutes of the Federal Reserve’s latest policy meeting, the week ahead is expected to be a busy one on Wall Street.

Regardless of the direction in which the market goes, we've highlighted one stock likely to be in demand, and another which could see further downside, below. 

Remember though, our timeframe is just for the upcoming week.

Stock To Buy: Tesla 

Tesla (NASDAQ:TSLA) shares are likely to enjoy increased buying activity in the week ahead after the Elon Musk-led electric car maker reported record first-quarter vehicle delivery figures over the weekend, yet again defying the skeptics and bears.

The EV pioneering company said on Friday it shipped 184,800 vehicles over the three months ending in March, up a whopping 109% from the same period last year, amid strong demand for its Model 3 and Model Y vehicles.

Consensus estimates called for deliveries of 168,000 vehicles.

The Q1 numbers represent a new record for the world’s most valuable automaker. The previous high was notched in the fourth quarter of 2020, when Tesla delivered 180,570 vehicles. Additionally, the Palo Alto, California-based company said it produced 180,338 cars in the first three months of 2021.

TSLA Daily Chart
TSLA Daily Chart

 

To add to those encouraging numbers, Apple (NASDAQ:AAPL) confirmed late last week that it plans to use Tesla batteries at its new renewable energy storage facility in California. The project, to which Tesla will supply 85 Megapack battery energy storage systems, bodes well for the future as it could indicate a warmer relationship between the two tech giants than previously thought.

TSLA shares ended Thursday’s session at $661.75, roughly 26.5% below their all-time high of $900.13 touched on Jan. 25, giving the company a market cap of $635.1 billion.

The booming electric vehicle sector was one of the best-performing group of stocks over the last year, before an aggressive reset in valuations hit the industry in recent weeks. After scoring a gain of more than 740% in 2020, TSLA shares are down 6% so far this year.

Stock To Dump: AMC Entertainment

AMC Entertainment Holdings' (NYSE:AMC) stock looks set to stay under pressure in the week ahead as investors continue to fret over the negative impact of several factors dogging the Leawood, Kansas-based movie-theater operator.

AMC stock ended Thursday’s session at $9.36, more than 50% below its recent high of $20.32 touched on Jan. 27.

Despite the recent sell-off, AMC shares—which started the year at $2.12—are still up approximately 340% in 2021 thanks to their extreme popularity with young retail investors on Robinhood and Reddit's WallStreetBets forum.

At current valuations, AMC, which is the world’s largest movie-theater chain, has a market cap of $4.5 billion.

AMC Daily Chart
AMC Daily Chart

Sentiment on the meme stock took a hit last week following news that AMC plans to seek shareholder approval to authorize an additional 500 million new shares as it seeks to raise much-needed cash to reduce its crippling debt load and stave off bankruptcy.

AMC first announced plans to seek the additional stock authorization in late March, with shareholders set to vote on the measure at the company’s annual meeting on May 4.

To make matters worse, several film studios, including Warner Bros. and Universal Pictures, announced recently that they plan to release many big-name movies this year straight to various streaming services, such as Walt Disney Company's (NYSE:DIS) Disney+, and AT&T's (NYSE:T) HBO Max.

The unprecedented move could mark a turning point for the movie theater industry. It could also crush AMC’s chances of a successful turnaround in the months ahead.

Taking that into account, AMC stock could fall further in the coming days. 

1 Stock To Buy, 1 Stock To Dump When Markets Open: Tesla, AMC Entertainment
 

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1 Stock To Buy, 1 Stock To Dump When Markets Open: Tesla, AMC Entertainment

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Comments (36)
Jarrett Russell
Jarrett Russell Apr 06, 2021 3:27PM ET
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dump amc? only a simp would dump amc
Mrinal Kapoor
Mrinal Kapoor Apr 06, 2021 12:57PM ET
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Stop making predictions about the short term. Even Warren Buffett is humble enough to know that's impossible to do
Toni Kl
Tonik Apr 06, 2021 9:59AM ET
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Its like weather report. You can take it in a account. But it can backfire. Thats market in other words, anything can happen.
Turnning Wang
Turnning Wang Apr 06, 2021 5:38AM ET
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This article made alot of people lose money! There should be laws preventing people from publishing lies!
Erikas Ivan
Erikas Ivan Apr 06, 2021 4:59AM ET
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Hello, why did the opposite happened from what's being written. I know we're not all Nostradamus, but I think we're keen on AMC now.
Phil Manuel
Phil Manuel Apr 05, 2021 7:46PM ET
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Jesse how did that amc trade work out for you?
Phil Manuel
Phil Manuel Apr 05, 2021 7:46PM ET
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Jesse how did that amc trade work out for you? lmaof
Henry Moradpour
Henry Moradpour Apr 05, 2021 5:37PM ET
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A little financial advice Do literally the opposite of what he is telling you to do and you will soon see that ghe results are impressing
Maharab Hassan
Maharab Hassan Apr 05, 2021 1:21PM ET
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This writer is f up. Totally oposite happen
Shawn Asgaralli
Shawn Asgaralli Apr 05, 2021 1:03PM ET
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AMC up 15%
Wesley Adams
Wesley Adams Apr 05, 2021 11:47AM ET
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I do the exact opposite of what these articles say these days.
Mark Paul
Mark Paul Apr 05, 2021 11:07AM ET
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You guys are really trying lol. How much did you sell your soul for?
Jim Holland
Jim Holland Apr 05, 2021 10:02AM ET
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We like the stock! I am not a cat!
Taj Brar
Taj Brar Apr 05, 2021 9:43AM ET
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You lost your credibility. How much HF’s paid you for this wonderful piece.
Love Stonks
Love Stonks Apr 05, 2021 9:35AM ET
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I think we will see all the meme people running from GME to AMC today
Quoc Duong
Quoc Duong Apr 05, 2021 9:10AM ET
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How much does HF pay for this guy? Is 10 bucks for this post worth it
Brian Lau
Brian Lau Apr 05, 2021 1:51AM ET
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did this guy do some copy and paste? markets were closed on Friday..
Elan Nachum
Elan Nachum Apr 04, 2021 11:54PM ET
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nice try hedgies!
Elan Nachum
Elan Nachum Apr 04, 2021 11:54PM ET
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lol, nice try hedgies!
Robert Garza
Robert Garza Apr 04, 2021 10:39PM ET
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The airlilnes have lost billions during the pandemic, and took on billions to have cash to ride out.  The last earnings they lost billions, and will lose billions again this coming quarter.  However, their stocks prices are close to all time highs, check Southwest out.  So why do these authors of these media companies, like this one and Motley Fool, come out with hit pieice after hit piece on what really is a small time stock like AMC.  Something must be up and nefarious for them to spend so much time on poor little old AMC.  They themselves probably have short positions or puts and on the HF payrolls somehow or someway.  They are far from from unbiased.
Fabrizio Fusaro
Fabrizio Fusaro Apr 04, 2021 10:05PM ET
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This guy id incredible. He wrote the same article about tesla and gme when when the first was at 800 and the second at 14. People lost a lot of money because of his nonsense articles (buy a company that is valued like all automakers and just sold, again, only 0.5% of total car?) and no one sue him or stop him to write this paid articles?
Kenny Haulsee
Kenny Haulsee Apr 04, 2021 10:04PM ET
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Found all the AMC bag holders! They get laughed out of WSBs so I guess they meet here now?
Ignas Berrnotas
Ignas Berrnotas Apr 04, 2021 10:04PM ET
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What bag holding? I bought AMC at $2 sold at $17 bought again at $6...
James Pattison
James Pattison Apr 04, 2021 9:00PM ET
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Buying amc at open... when this numb nutts says sell... you should buy... wrong more than right
Tony Ralt
Tony Ralt Apr 04, 2021 8:41PM ET
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You are wrong. Godzilla vs Kong did $50M this weekend in theaters even with streaming options available. studios make nothing on streaming compared to theaters.
Pupi Pi
Pupi Pi Apr 04, 2021 7:58PM ET
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Paid article orderd by hedge funds. AMC will skyrocket.
Fabrizio Fusaro
Fabrizio Fusaro Apr 04, 2021 7:58PM ET
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He wrote the same article when Tesla was at 800...Check it
 
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