Tuesday Ticker: February 18, 2019

Market Correction

After seeing its value tumble by 18 percent on February 5, Tesla’s stock has steadily gained back some ground.

At the time of publication, the value of the stock was $776.34 US, up from a $734.70 US on February 5.

On February 4, the stock reached an all-time high, trading at $887.06 before jittery investors started looking to sell after several media sources described the stock as overvalued.

While the recent correction saw some recent investors loose a considerable amount of money, these losses may be quickly recovered.

At the end of 2019, the stock was valued at $650.57 US. At the end of 2018, it was trading at just $333.37 US.

Tesla is world’s best-selling plug-in passenger car manufacturer, both as a brand and by automotive group. Since 2015, it has seen its market share diminish to just 17 percent of all EV sales.

BASF’s battery bump

BASF will open a new battery materials factory in East Germany. At full production, it is expected to produce battery materials for as many as 400,000 vehicles per year.

After the announcement, BASF saw its stock tick up by almost two percent, before trading settled at one percent over the day’s opening.

The company has invested 400 million euros– $500 million– into efforts to produce electric vehicles.

Located about 120 km from Berlin, the new business will supply cathode active materials required by electric batteries to North America, Europe and Asia.

The company is hoping to benefit from European Union incentives aimed at encouraging battery research. In December, the European Parliament in Brussels approved 3.5 billion euros, some of which will offset BASF’s costs.

Intact Investment

Major Canadian financial institutions have jumped at a special investment opportunity with Intact Insurance.

TD Securities, BMO Capital Markets, CIBC Capital Markets, National Bank Financial, RBC Capital Markets and Scotiabank have reached a deal with Intact Financial Corporation to purchase 5 million non-cumulative class A shares at $25 each. The $125 million investment will yield 5.40% per annum, payable quarterly, as and when declared by the Intact boar of directors.  The Series 9 Shares will not be redeemable prior to March 31, 2025.

Over the past ten years, investors in Intact have seen their investments grow more than 3.9 times over. Investors have responded warmly, with Intact’s normal stock sitting at $151.79–a near-record price.

The value of the investment will not grow–or fall–with other shares, as they are structured to pay out in a way more similar to high-yield bonds. The investment is indicative of the financial world’s belief that Intact is likely to continue to thrive in the next five years.

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