Profit Pregame

As December 21 Grows Near – Here’s How I Plan to Approach Tesla

It finally happened…

This stock is officially ready to make it’s S&P 500 debut.

What’s happening?

It’s been months of speculation and waiting – but besides the odds against it – Tesla has officially joined the S&P 500. On Monday, the S&P Dow Jones Indices announced that the electric carmaker would be added to the benchmark on December 21.

The company became eligible earlier this year after recording four consecutive profitable quarters. It’s now been in the black for five consecutive quarters, which happens to be the company’s 17-year history. And it will be making quite an entrance given that based on Monday’s closing price, Tesla could be one of the ten most valuable companies in the index.

Where’s the money?

The company, led by infamous CEO Elon Musk, has actually been qualified to be a part of the index for quite some time now. The market cap minimum for the S&P 500 is $8.2 billion, a number that Tesla bypassed a while ago, but other factors have kept Tesla out. The make-up of the S&P 500 is determined by what’s known as the “Index Committee,” which digs into quantitative as well as qualitative factors.

And it was these same factors that kept Tesla out of the S&P back in September. It was a decision (and what many called a snub) that shocked the entire market. Investors had loaded up on Tesla shares to prepare for its ascension into the index – but the committee decided to pass.

So, needless to say, when the news broke, investors celebrated and breathed a sigh of relief given the committee’s track record. And while I like Tesla – here’s my gameplan to cash in on the S&P’s newest addition.

How do I get some?

Here’s the thing you need to know about the S&P 500, adding Tesla to its line up – individual fund managers will own a piece of the carmaker. And while this is good news for Tesla, the announcement is causing some pressure from the highs.

Now, I’ve always been a fan of Tesla. Even before this announcement, I’ve made good money by investing in this stock. But with that said, I won’t be racing after Tesla just yet. You see, with this news, the stock will undoubtedly move higher. And currently, it is sitting at $444, and that’s way too overpriced for me.

And that’s why when it comes to my investment plan, I am looking for Tesla to test lower and am aiming to buy this big name around the $360 level. And rest assured, I’ll be sure to keep you updated on the price movements to come.

In the spotlight: This bank is looking to be the top dog…

We’ve talked about this a few times here – but the housing market is booming and shows no signs of slowing down. And companies who specialize in supplying builders are feeling that positive momentum. And one company, in particular, is upping its game to ride the wave while it lasts.

Home Depot, which has performed well amidst the pandemic, recently reported better-than-expected sales and earnings. Sales at stores that have been open for at least one year climbed 24% in the third quarter. And Home Depot reported a net profit of $3.4 billion, an increase of more than 20% from a year ago.

The company is now planning to invest $1 billion annually to increase its employee’s benefits. Home Depot revealed that it would be putting a temporary program into place during the pandemic to offer expanded paid time off and weekly bonuses. The company also cemented a plan to give hourly workers a pay increase permanently.

As an investor, this decision caught my eye. And that’s because any company willing to commit to such a large (and expensive) plan during the time of the pandemic must be doing pretty well for itself. And this, combined with the company’s impressive earnings report, is enough for me to keep a very close eye on this stock. And I’ll be sure to keep you updated too.

Now, How Do I Get Some More?

While there are many ways to profit from established industry leaders like Tesla, one of the best ways I know of to score outsized returns is by investing in startups.

But the problem is that opportunities like those are generally reserved for the super wealthy… until today.

One company is looking primed to transform a $19 billion industry, and they’re opening their doors to early investors – and you can stake your claim for as little as $250.

Get the full story on how you can secure your early investment (and even some bonus shares) right here.

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