WHY SQUARE, IROBOT, TESLA & NIO STOCK ARE DROPPING

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Always focus guys it was another crazy day out there in the stock market today we had a lot of stocks making a lot of big moves out there and i want to talk about some of these stocks here today by the way who’s on that crazy live stream earlier i know some of you guys were alright so some of the stocks i want to talk about here today or square stock okay ticker

Symbol sq this one has been super hot and took a big hit today down over $8 a share down eight and a half percent we want to talk about i robot ticker symbol i rb t that one fell over nine dollars per share about eight and a half percent tesla shares fell another four plus percent today it’s down up around its 52-week low now there’s the tesla stock has just been

Nailed i’m gonna talk about why that one’s down and then neo stock took another three plus percent dive again here today remember that one was called bluto slow of china okay so we’re gonna talk about all these stocks why they ended up dipping today hit a thumbs up if you enjoyed this guy’s so first off let’s talk about square all right so square is starting to act

More like a traditional bank and one analyst went ahead and downgrade them pretty big today on some what he calls credit risk out there all right the company’s shares move down huge on this as we saw the market this is for coming from the analyst now the market appears to be overlooking any risk to the company’s business model in credit risk in particular palmer

Said in a note to clients on monday our bearish thesis on square is predicted in part on our view that the company’s increasing dependence on the extension of credit to its customers to spurs growth increasingly vulnerable to volatility in the credit markets he says okay last week’s square capital launch square installments to let users charge for big purchases

By splitting them into smaller fixed monthly payments square takes on that loan and the customer buying the product he’s it back you neither three six or twelve month periods the new offering is likely to increase this vulnerability the analyst says o-ring btig which is where this analyst works has a sell rating on the stock the stocks obviously up over two hundred

Percent this year has had an amazing year but this analyst believes it’s going to go to around dollars a share all right that’s like a 60-plus percent downward move they’re absolutely massive move down all right and so so his basically huge worry out there as he says this is a company that obviously is trading an unbelievably high valuation however he believes that

A lot of this company’s growth is on the back of basically giving out some risky loans and basically right now with a lot of people are employed you know the economy’s good things like that but what happens when the economy is not good what happens when you know who people start losing their jobs which eventually will come we don’t know when that is it could be a

Year from now two years from now five years from now it will happen eventually someday what he is basically saying is this company has a massive valuation on it and no one is thinking about the risk to this company when whenever the cards come crumbling down once again okay and what he’s saying is when those people stop paying those payments right this company is

Gonna be at a massive financial jeopardy and so this is why he believes this company should be trading on a much lower valuation than where it’s currently trading up because of the roots of risk you can always look at the banking sector you know traditional banks they all traded much lower valuations than what they might have historically traded at mainly because

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Those honestly a lot of people saw what happened in the recession they saw how those companies got absolutely killed how to end up being saved and whatnot and the way this gentleman’s looking at is he’s saying a company like square if they if they were a big financial jeopardy there are the stage where they’re not big enough to really matter that much right now so

They could the government might just let them go under okay let’s say the economy is totally weak let’s say this company has a massive credit risk let’s say you know the company also starts to lose hundreds of millions of dollars are billions of dollars on these credit loans and the companies that you know a jeopardy of maybe going bankrupt or filing for bankruptcy

Or something you know it could be possible a government will say oh who cares about them they’re not wells fargo they’re not bank of america they’re not goldman sachs or jp morgan or any of those bangs they’re not big enough to really matter so it definitely should be a risk that is thought about if you own a company like square stock paypal also fell on this news

We know a lot of those those companies are trying to get into the almost like banking business to a certain extent now that people need to have you know their phones and whatnot and a lot of people are looking at it’s do i really need a traditional bank account through wells fargo or chase or bank of america maybe i can just use square maybe i can just use paypal

Full-time or something like that so these these companies are getting into that business this guy’s saying hey watch out that you’re gonna have some big credit risk down the road so we’ll have to see what happens with that if you guys have an opinion let me know in that comment section next up here let’s talk about i robot so if you didn’t know i robot makes the

Roomba vacuum cleaner this analysts it came out and downgraded them big today piper from piper jeffrey says irobot will suffer from the latest escalation in the trade conflict between the us and china the firm lowered its rating to neutral from overweight for irobot shares predicting trade tariffs will hurt the company’s business next year you know that says we

Have become increasingly more concerned with the stocks valuation given the out performance experience in 2018 coupled with the recently implemented trade tariffs that analysts said in a note to clients on monday we believe the recently implemented trade tariffs for robotic vacuums will have a negative impact on robots guidance for 2019 he’s saying okay jennsen

Maintained his $90 price target for the company stock representing 15 percent downside from friday’s closing price although that’s much closer to $90 now the analysts at irobot uses contract manufacturers based in china and they’ll be hit by the tariffs that is true all right that the tariffs already are now at a 10 percent rate this was go to 25 percent by january

1st he says we believe irobot will likely pass these price increases on to consumers but this could lead to lower growth given the higher price points if irobot doesn’t do that then basically the margins will shrink in you know will be a much less profitable business so he’s basically saying that this they’re in a no-win situation i robots in a no-win situation they

Can either appraise his big time which we already know their latest vacuum cleaner is like nearly $1,000 that they came out with right says they could you know up the prices big time and maybe that will slow down a lot of their revenue growth because a lot of customers will say well well you know this vacuum cleaner that only has this feature and that features now

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Also $600 and this one over here 700 maybe we don’t want to buy that okay they could do that and maybe they get less sales or they could say you know know what let’s just let’s just take the hit on this it’s lower our margins and all sudden the company’s profitability is not very know nearly as impressive as it could be okay so he’s saying ai robots pretty much

In a situation where it’s a no-win situation right now and the company has a fairly high valuation on it right now we’ll have to see what happens with that let me know if you guys got an opinion on a robot down there i would love to hear from you all right you guys now is talk about tesla right people are like when is tesla gonna stop falling you know obviously

The the day the whole news came out about tesla might go private that was what was that probably two months ago now stock was out of nearly 300 $90 on that day and now it’s at 250 and people are like why is this continuing to go down well there’s some more scary news i guess you say out there about what’s gonna happen with this tesla situation so obviously if you

Didn’t you know haven’t been following tests so you know you all must last week tweeted out the whole whole short seller enrichment commission you know basically troll in the sec but here’s the problem with that a judge handling the settlement has ordered musk and the sec to write a joint letter explaining why the court should approve the deal this is not unusual

For the judge to do that but it leaves open the possibility she will reject the settlement okay the behavior at such a critical time suggests tesla’s board of directors may not be able to rein must in the judge may have some real concerns that tesla won’t be able to do anything about must tweets and social media is difficult to pre-clear or to prove in advance

Unless he’s willing to do so in cooperate and obviously you know that was the tweak that happened last week is not a good look for you know musk it’s not a good look for the tesla board of directors and things like that they’re in a serious situation like this you’re basically troll in the sec so we’re in a situation now where you know the fate is kind of in a

Judges hands you know the judge can say okay i approve this as it deals good or the judge can say no i don’t like this at all i don’t i think you need a much harder punishment elon musk you obviously you know haven’t learned your lesson you wouldn’t roll them on twitter you know you know a few days after the settlement would and whatnot we don’t have enough faith

That you’re gonna do a good job as far as that goes so right now you know things are still up in the air the settlement you know between musk and the sec is kind of done but it still needs to be approved by an actual judge and we don’t know what what viewpoint that judge is gonna have so a lot of people are still looking at tesla stock and although the numbers are

Great and there’s some more good news came out today in regards to crash test ratings in regards to tesla’s what not in the model 3 specifically all that has great news there’s a lot of great news there but this fear of what that judge will end up deciding is scaring a lot of people you know that are involved with this stock right now because what if what if she

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Goes ahead and says no i don’t like this deal go back to the drawing board what are we looking at at that point in time well you know she says i want something much harder in musk than what it is you know it’s still got to go through this judge guy so that’s where that one’s scary and i think that’s why i dropped you know you know another four plus percent here

Today all right a lot of people selling out of their shares to keep tesla to continue to move down like this is a lot of selling pressure on this stock maybe it ends here or maybe a continues lower watt to see neos stock so neo stock i have two reasons why this stock continues to drop although it wasn’t in the news particularly fell another three and a half plus

Percent today you know this stock has been a disaster basically since the you know two days after the ipo it topped out at 12 plus dollars a share and you know that same day i put out that video and now you know neo stock is down 50% since i put out that video and i think there are two parts why neo stock continues to fall one is tesla stocks not doing good electric

Vehicle you’ve got a neo stock another electric vehicle company i think it’s just not a good look for a neo stock out i think the excitement’s not there right now if tesla stock was flying high right now and everybody’s just talking about the positive of electric cars and whatnot maybe a lot more people jump into a neo stock but you know right now it’s not looking

Good okay the other part right now is with neo stock it’s a chinese company okay not only is it a chinese company it’s a chinese company with no earnings right now okay so it was puts it in the basket of people absolutely hate this talk it is part of the reason why i wanted to warn everybody that you could be you know hurt ridiculously bad like any stocks are

Risk out there but this one in particular with their no earnings and everybody looking at this talk and saying no earnings it’s a chinese company chinese stocks are hated right now if you don’t know like pretty much every single chinese stock out there is near its 52-week low or somewhere down there down substantially over the past three six months okay so when

People are looking at this stock they’re like whoa why do i want a piece of that okay why do i want a piece of neo stock so we’ll have to see if things revived there you know tesla stock i think would have to start going up massively to start to get this one and go up and people would have to stop you know all the negativity around chinese stocks right now like

Like great chinese companies like ten cent and alibaba or you know as stocks have been just free falling down never mind a stock that has no earnings like neo stock that people are like who knows about this company like if ten cent and alibaba are falling like imagine what that does for all the risk your stocks that’s why you get a stock like this that’s down you

Know 50-plus percent in three or four weeks guys it’s absolutely ridiculous so anyways hope you guys enjoy this hope you enjoyed that random livestream earlier today definitely check that out if you want i think i’ll have it as a pin comment might even be the suggested video on the this video so anyways thank you for watching guys and have a great day

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WHY SQUARE, IROBOT, TESLA & NIO STOCK ARE DROPPING By Financial Education

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