Good morning! The stock market finished the day red all over, but one name stood above them all.

Tesla staged a supersonic overnight rally — today’s edition unpacks why.

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Tesla’s winning quarter

While critics bemoan Elon Musk’s politics and social media habits, Tesla shareholders celebrate the billionaire’s ability to make electric vehicles. 

Tesla stock rallied more than 12% in after-hours trading as it released its third-quarter results, reversing a 2% loss from earlier the same day.  

Here’s what Tesla announced:  

• Adjusted earnings per share: $0.72, above estimates for $0.60, up 9% from a year ago

• Revenue: $25.18 billion, below estimates for $25.43 billion, up 8% from a year ago

Gross margins also increased 19.8% in the quarter — above the 16.8% forecast — and Tesla’s cost-per-vehicle dropped to a record low $35,100. 

“This is clearly an indication that Musk & Co is continuing to focus on its profitability side while balancing its plans for the future,” said Wedbush analyst Dan Ives, a long-time Tesla bull. 

App Economy Insights shared a helpful visual of the earnings:

Ives’ team maintains a price target for Tesla stock of $300, about 40% higher than Wednesday’s closing price.

Tesla, which is worth about $669 billion, shared a bullish sales outlook and said it expects “slight growth” in car deliveries for 2024, bucking expectations for a decline.

"Preparations remain underway for our offering of new vehicles — including more affordable models — which we will begin launching in the first half of 2025,” Tesla said in a statement.

Notably, data from Cox Automotive showed Tesla sold 16,692 Cybertrucks in the quarter despite facing safety concerns and criticism.

That made it the third-highest selling car in that stretch — behind two other Tesla products. 

In fact, the Cybertruck reached profitability in the quarter for the first time ever.

EVs from Ford, Rivian, Audi, BMW and other brands did not come close to Tesla’s vehicle sales.

Three weeks ago, Tesla stock declined 3% after executives reported 462,890 vehicles delivered in the third quarter, just shy of some estimates. 

Then, its “We, Robot” event on October 10 sent the stock another 9% lower as Wall Street sold the news on RoboTaxis, CyberCabs, and humanoid robots.

On the evening earnings call, Musk said he’s confident that Tesla’s autonomous vehicles and ride-hailing services will gain regulatory approval in Texas and California for a 2025 rollout.

Notably, shares of Lyft and Uber declined in overnight trading after Musk’s comments.

“Tesla will become the largest company in the world, and by a long shot,” Musk said.

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Elsewhere:

🏠️Existing home sales plunged. The figure dropped 1% to hit the lowest since 2010 in September, hovering at a seasonally-adjusted rate of 3.84 million. Compared to a year ago, sales of previously owned homes were 3.5% lower. (Yahoo Finance)

📙The Fed released its latest Beige Book, showing economic activity is moderating across the US. Despite stronger-than-expected macro data recently, the report still pointed to a broad slowdown of business conditions, as well as election uncertainty. (Bloomberg)

💵 Warren Buffett doesn’t want to get political. The Berkshire billionaire said he neither endorses presidential candidates nor investments. Specifically, Buffett said he is worried about the rise of social media impersonators who would try to leverage his name. (CNBC)

Rapid-fire:

• Spirit Airlines stock spiked as much as 40% after reports of a potential merger with Frontier Airlines (WSJ)

• Apple and Goldman Sachs were ordered to pay more than $89 million for Apple Card failures (CNBC)

• Boeing reported a $6.17 billion loss in the third quarter (Yahoo Finance)

• Apple has cut back on Vision Pro production with sales waning (Reuters)

• Coca-Cola posted stronger than expected earnings and revenue, with higher prices offsetting sluggish demand (CNBC)

Interview:

Anthony Pompliano — Opening Bell Daily’s co-founder — and I had a wide-ranging conversation about Paul Tudor Jones’ bitcoin bet, AI and the stock market, and Goldman Sachs’ bearish S&P 500 outlook:

Election odds according to Kalshi, the biggest US prediction market:

Last thing:

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