Market Overview - Major U.S. equities indexes moved higher, with the S&P 500 advancing 0.5%, the Dow up 0.4%, and the Nasdaq ending roughly 0.3% higher, driven by consumer spending despite a slight deceleration in GDP growth [2]. Company Performances - Vistra (VST) shares surged 13.6%, recovering from earlier losses, as optimism about its potential to power AI data centers contributed to a 330% increase over the past year [3]. - IBM (IBM) stock rose 13.0% after exceeding earnings and sales estimates for the fourth quarter, with strong revenue growth in its software business driven by AI demand [4]. - Las Vegas Sands (LVS) shares increased by 11.1% following a quarterly report that showed fourth-quarter sales exceeded estimates, despite softness in its Macao business [5]. - United Parcel Service (UPS) shares fell 14.1% after reporting lower-than-expected fourth-quarter sales and profits, alongside an agreement to cut Amazon delivery volumes by 50% [6]. - ServiceNow (NOW) shares dropped 11.4% after its fourth-quarter earnings release, where subscription revenue growth fell short of guidance [7]. - Comcast (CMCSA) shares decreased by 11.0% due to a wider-than-expected decline in broadband customers, despite beating profit and sales estimates driven by its Peacock streaming service [8].

Core Insights - The focus of the earnings reports from Microsoft and Meta was on artificial intelligence (AI) and its impact on revenue generation [2][3] - Both companies expressed confidence in their AI investments despite market concerns regarding competition from Chinese start-up DeepSeek [10][11] AI Business Growth - Meta reported that its AI reached 700 million monthly active users in Q4, with its AI-powered Advantage+ marketing service growing by 70% [3] - Microsoft announced an AI revenue run rate of $13 billion for the quarter, exceeding its previous forecast of $10 billion [4] - IBM's AI business generated nearly $2 billion in the last quarter of 2024, accounting for about 40% of its total AI revenue since inception [4] Commitment to AI Investments - Microsoft plans to invest $80 billion in infrastructure for FY2025, having already spent $30.7 billion in the first two quarters, a 56% increase year-over-year [5] - Meta's CEO indicated that the company could invest up to $65 billion in AI this year, viewing it as a strategic advantage [6] - Both Microsoft and Meta expect to cumulatively invest nearly $150 billion in infrastructure in their respective 2025 fiscal years [10] Market Reactions and Future Outlook - Concerns about whether demand will match the scale of AI infrastructure investments have been prevalent on Wall Street, especially with the emergence of DeepSeek [7][8] - Despite market jitters, tech executives believe that DeepSeek's efficiencies could enhance AI application development and increase demand for cloud services [8][10] - Microsoft and Meta executives praised DeepSeek's innovations, suggesting that they could ultimately benefit their businesses by lowering costs and increasing application development [11][12]

Earnings and AI Business Growth - IBM shares surged 12% to $256 after posting better-than-expected Q4 earnings, driven by strong performance in its AI business [2] - The company's generative AI book of business grew by nearly $2 billion from the previous quarter, reflecting global client demand for AI-driven enterprise solutions [3] - IBM's software segment revenue increased by 10.4% YoY, marking its largest jump in five years, offsetting weaker performance in consulting and infrastructure [3] Stock Performance and Technical Analysis - IBM shares hit a record high near $262 and have gained 36% over the past year, outperforming the S&P 500 [4] - The stock is poised for a breakaway gap above the top trendline of an ascending triangle pattern, indicating bullish momentum [5][10] - Technical analysis suggests two upside price targets: $278 based on the measuring principle and $305 using bars pattern analysis, with the uptrend potentially lasting until May [7][9][10] Key Support Level - Investors should monitor the $238 level as a key support area, which may attract buying interest during pullbacks and could transition from resistance to support [10][11]

Core Insights - Tesla's recent earnings report revealed a decline in revenue and adjusted profits, marking the company's first annual drop in vehicle deliveries, yet the stock saw a rise of over 4% [2][5] Self-Driving Software and Robotaxi Plans - Tesla plans to launch its unsupervised self-driving software as a paid service in Texas and California around June, with potential expansion to other markets [3][8] - The company aims to operate its "Cybercab" autonomous taxis by the end of the year, allowing Tesla owners to rent their vehicles for autonomous use next year [4][8] Analyst Perspectives - Analysts from JPMorgan maintain an "underweight" rating with a $135 price target, expressing concerns that the stock's rise is disconnected from the company's financial performance [5][6] - Oppenheimer analysts remain cautious about the timeline for full self-driving development, while Morgan Stanley holds an "overweight" rating with a $430 price target, noting the focus on Optimus and AI during the call [6] Future Delivery Expectations - Tesla anticipates a return to growth in vehicle deliveries by 2025, projecting deliveries to increase to approximately 1.94 million vehicles, an 8% rise year-over-year [7][9] Optimus Robot Projections - Elon Musk is optimistic about the potential revenue from the Optimus humanoid robot, suggesting it could surpass vehicle sales, with plans to produce thousands for factory tasks this year and potential sales to other companies next year [10][11]

Group 1 - Tesla is focused on future growth opportunities, with CEO Elon Musk discussing potential $10 trillion in robot sales during the earnings call, rather than recent vehicle sales or quarterly results [1] - Investor sentiment towards Tesla has become more positive, with analysts recognizing future growth drivers, although execution risk remains high [3] - Tesla's stock is perceived as more than just an auto company, with analysts suggesting it is viewed as an AI company, leading to varied price targets among analysts [3] Group 2 - Deepwater Asset Management noted that despite messy quarterly results, investors are optimistic about Tesla's future, indicating that the current focus is on potential growth rather than past performance [2] - The mean price target for Tesla shares is around $374, which is below the recent closing price, reflecting a cautious outlook from Wall Street analysts [2] - Over the past 12 months, Tesla's stock has more than doubled, recently trading just below $400, indicating strong market performance despite mixed analyst ratings [3]

Core Insights - Caterpillar (CAT) shares experienced a decline after the company's fourth-quarter revenue fell short of expectations, reporting $16.2 billion, a 5% decrease year-over-year, and below analyst consensus [1][3] - The company's earnings per share reached an all-time high of $5.78, an increase from $5.28, surpassing analysts' expectations [1] Revenue Breakdown - Revenue from the construction industries segment decreased by 8% to $6 billion [2] - Resource industries, including mining trucks, saw a revenue drop of 9% to $2.96 billion [2] - The energy and transportation segment remained flat year-over-year, generating $7.65 billion in revenue [2] - The decline in revenue was attributed to lower sales volume due to shrinking dealer inventories, which fell by $1.3 billion in the fourth quarter compared to a $900 million decrease the previous year [2] Market Reaction - Caterpillar's shares fell approximately 5% intraday following the fourth-quarter results [3] - The company is viewed as a bellwether stock, serving as a proxy for both domestic and global economic trends [3] - Over the past 12 months, Caterpillar's shares have increased by about 25% [3]

Core Insights - IBM shares surged 13% following the release of fourth-quarter results that exceeded analysts' expectations, driven by strong performance in its AI-enabled business [2][4] - The company reported adjusted earnings per share (EPS) of $3.92, surpassing the consensus estimate of $3.79, and revenue of $17.55 billion, slightly above expectations [2][4] Financial Performance - IBM's fourth-quarter adjusted EPS was $3.92, exceeding the Visible Alpha consensus of $3.79 [2][4] - Revenue for the quarter was reported at $17.55 billion, which was marginally higher than analysts' expectations [2][4] AI Business Growth - The generative AI segment of IBM's business has grown significantly, with a total value exceeding $5 billion since inception, marking an increase of nearly $2 billion from the previous quarter [3][4] - CEO Arvind Krishna emphasized that IBM's AI products offer clients a scalable AI foundation based on open-source technology [3]

Shares of United Parcel Service (UPS) sank 10% in premarket trading Thursday after the shipping giant reported worse-than-expected fourth-quarter results. The company reported net income of $1.72 billion, or $2.01 per share, on $25.3 billion in revenue. Analysts had expected profit of $2.14 billion, or $2.51 per share, on revenue of $25.35 billion, per Visible Alpha. After stripping out $639 million in charges that were mostly related to pensions, UPS reported adjusted earnings per share (EPS) of $2.75, ab ...

Core Insights - IBM shares increased nearly 8% in premarket trading following the release of fourth-quarter results that exceeded analysts' expectations, driven by a surge in its artificial intelligence (AI) business [2][4] - The company reported adjusted earnings per share (EPS) of $3.92, surpassing the consensus estimate of $3.79, and revenue of $17.55 billion, slightly above expectations [2][4] Financial Performance - IBM's fourth-quarter adjusted EPS was $3.92, exceeding the Visible Alpha consensus of $3.79 [2][4] - Revenue for the quarter was reported at $17.55 billion, marginally higher than analysts' expectations [2][4] AI Business Growth - The generative AI business has seen significant growth, with the total book of business now exceeding $5 billion, an increase of nearly $2 billion quarter over quarter [3][4] - CEO Arvind Krishna emphasized that IBM's AI products offer clients a consistent and scalable AI foundation based on open-source technology [3]

Key TakeawaysTesla shares gained ground in extended trading on Wednesday as optimism over the automaker's self-driving outlook trumped fourth-quarter results that came in below Wall Street’s expectations.The price looks sets to gap above the top trendline of a flag pattern on Thursday in a move that could resume the stock’s upward momentum.Bars pattern analysis, which takes the stock’s trending move from October to December and overlays it from the flag pattern’s lower trendline, projects a longer-term bull ...