The Market News Reel for the week of August 30th! Find out the most important market news and updates for the upcoming week each Monday along with major breaking news and analysis as it happens!
Major headlines, excerpts from a reputable news source and a link to the full article are shown below. "Our Thoughts" section is purely our opinion.
Hurricane Ida Pounds the US Golf Coast
"A fearsome Hurricane Ida left scores of coastal Louisiana residents trapped by floodwaters and pleading to be rescued Monday while making a shambles of the electrical grid across a wide swath of the state in the sweltering, late-summer heat.
One of the most powerful hurricanes ever to hit the U.S. mainland weakened into a tropical storm overnight as it pushed inland over Mississippi with torrential rain and shrieking winds, its danger far from over.
Ida was blamed for at least one death — someone hit by a falling tree outside Baton Rouge — but the full extent of its fury was still coming into focus at daybreak." - read more here
Rivian Electric Vehicle Startup Files for $80 Billion IPO
"Rivian Automotive Inc., the maker of electric pickups backed by Amazon.com Inc., has filed for an initial public offering and is seeking a roughly $80 billion valuation, according to people familiar with the matter.
The Irvine, California-based startup submitted its S-1 registration to the Securities and Exchange Commission last week. The company would like to do an IPO around Thanksgiving, though the timing will depend on approval from the SEC.
A listing at the valuation Rivian is pursuing would be one of the biggest-ever market debuts for an auto company. With $10.5 billion raised from backers including Amazon and Ford Motor Co., an established factory in Illinois and thousands of reservation holders for its R1T truck and R1S sport utility vehicle, Rivian is among the most serious competitors lining up to take on electric-vehicle leader Tesla Inc." - read more on Bloomberg here
Our Thoughts: This is good news for the EV industry as a whole, the development of new factories, technologies and platforms is necessary to get transport off of fossil fuels. But, at the same time the valuation is quite massive for a company that has not yet delivered a single car to customers or earned revenue.
For context, Tesla (TSLA) traded at a value around $30-45 billion for the years of 2017-2019, while delivering 10s of thousands of cars and earning billions in revenue each year. Tesla can currently produce ~800,000 cars per year.
Rivian, Lucid and other EV startups have a long way to go before reaching those types of production levels.
Despite this, we believe new startups operating on purpose built EV platforms will have an easier time scaling production than legacy auto makers such as GM or Ford due to their massive investments in non-EV production facilities and parts as well as institutional inertia towards gas powered vehicles.
Canadian Election Heats Up: Read the Platforms
"Canadians will head to the polls on Sept. 20 after the shortest election campaign ever.
Before that, the leaders of each political party will attempt to appeal to voters coast-to-coast-to-coast, detailing their plans to revive the economy following the COVID-19 pandemic.
Here’s a look at what each party has promised so far on the major issues affecting the economy, business and your money. BNN will update this platform tracker as more details are announced." - read more on BNN here
Our Thoughts: While Canadian politics is less wild than US politics, this election seems to have stark differences between the main political parties on major policies as well as the issues of covid, economic recovery and housing. Articles like the above do a good job of laying out policy differences and are worth a close look.
Major Earnings This Week
Monday August 30:
Zoom Video (ZM): Expected Q2 earnings of $1.16 per share
Tuesday August 31:
Crowd Strike (CRWD): Expected Q2 earnings of $0.09 per share
Alimentation Couche-Tard (TSX: ATD.B) : Expected Q1 earnings of C$0.65 per share
Wednesday September 1:
Asana (ASAN): Expected Q2 earnings of $-0.26 per share
C3.ai (AI): Expected Q1 earnings of $-0.28 per share
Campbell Soup (CPB): Expected Q4 earnings of $0.47 per share
Laurentian Bank of Canada (TSX:LB): Expected Q3 earnings of C$1.08 per share
VersaBank (TSX:VB): Expected Q3 earnings of C$0.26 per share
Thursday September 2:
DocuSign (DOCU): Expected Q2 earnings of $0.40 per share
BRP (TSX:DOO): Expected Q2 earnings of C$1.40 per share
Major Expected IPOs This Week
None
See you next week!
If you want to learn how to apply news and information into your financial decision making then visit our Learn Personal Finance guide or check out our easy to use Financial Tools! Best of luck and happy investing to all!