Stockwatch
HedgeWeekly Stockwatch: Tesla slides before the bell as Meta weighs AI spending
Five shares in focus on Thursday: Meta, Tesla, Lam Research and IBM after Wednesday's results, plus Barclays after a profit miss in London.
HedgeWeekly Markets Desk ·
META, Meta Platforms: Q3 revenue rose 26% to $64.6 billion, above about $63.4 billion expected, and Q4 guidance is $73-76 billion; a New Mexico judge separately ordered a $25 billion privacy penalty, which Meta will appeal. Bull case: Supporters point to 14% higher ad prices, 10% more ad impressions and a revenue beat. Bear case: Critics flag free cash flow of minus $2.12 billion, no buybacks and the $25 billion ruling.
TSLA, Tesla: Adjusted EPS of $0.48 beat about $0.43-0.45 estimates on revenue of $28.05 billion, but Tesla cut its 2026 capex plan to about $20 billion from more than $25 billion. Bull case: Supporters note positive free cash flow above $1.5 billion and cash above $45 billion. Bear case: Deutsche Bank said the capex cut raises questions about the pace of its AI and robotics shift.
LRCX, Lam Research: Record revenue of $8.22 billion beat $8.15 billion expected, and it guided to $8.6 billion plus or minus $400 million, but shares fell after hours. Bull case: Supporters cite AI-related chip demand and the guide midpoint above the $8.53 billion consensus. Bear case: China rose to 35% of sales, and GuruFocus flagged valuation concerns.
IBM, IBM: Adjusted EPS of $2.95 beat $2.86 and revenue of $17.1 billion topped forecasts; IBM raised its free cash flow outlook but shares slipped after hours. Bull case: Supporters point to the beat and free cash flow growth now seen above $1 billion. Bear case: Software growth slowed to 8% from about 10% a year ago, and IBM Z revenue fell 20%.
BARC, Barclays: Q3 pre-tax profit rose 12% to £2.3 billion, short of about £2.4 billion expected, as fixed income trading fell 19%; it announced a £500 million share repurchase. Bull case: Supporters note equities revenue up 47% and the new £500 million repurchase. Bear case: Critics point to the profit miss and a 19% fixed income drop, far worse than US rivals.