All posts by Michael Comeau
My Favorite Secret AI Stocks
What a week! Moderna (MRNA) announced a major cancer vaccine breakthrough. Rising Treasury yields have traders on edge, even with Treasury Secretary Scott Bessent cranking up buys of long-dated bonds. And Wal-Mart (WMT) announced disappointing sales. Now let’s dig into the most interesting stories in the market ahead of a very busy week for tech earnings and economics. Skip Ahead! Nvidia Needs a ShockJensen Huang’s Other Favorite Stock Reports EarningsThe Banks Might Be the Best “Secret” AI StocksThe Great Biotech Short SqueezeTraders Are Still SkittishNext Week’s Calendar Is StackedThe Pristine Mentorship Is Open Nvidia Needs a ShockNvidia (NVDA) earnings are coming in hot on Wednesday, August 26.And it looks like we need a big monster beat and guidance to catapult the stock higher.The stock has sold off the day after earnings 4 straight times, and in 6 of the last 8 quarters. You can see this on the right-most column here:The culprit is shrinking revenue beats.Yes, the company is growing fast but gone are the days of giant revenue beats, which is the heart soul of momentum stocks.Nvidia always reports strong numbers, but they it’s been years since they’ve shocked the market with blockbuster sales and guidance.Will that change next week?With the way hyperscalers like Meta (META) and Alphabet (GOOGL)are spending money, anything is possible.But for now the bears seem to have the post-earnings advantage. Speaking of earnings…Jensen Huang’s Other Favorite Stock Reports EarningsI’ll go out on a limb and say Nvidia CEO Jensen Huang’s #1 stock is Nvidia. His second favorite appears to be Marvell Technology (MRVL), a stock I bought myself. One reason I jumped on Marvell was because Mr. Huang called it “the next trillion dollar company” back in June. Marvell reports after the close Thursday. The company has its fingers in multiple AI data center applications, so we’ll get even more insights on AI infrastructure spending trends. Traders will also be eager for more details on Marvell’s monster chip deal with Google. To make a long story short, Google’s gonna spend a ton of money on Marvell chips. And in return, Google gets the right to buy up to 58,970,907 Marvell shares at $206.58. The more Google spends, the more Marvell shares it can buy. That’s great for Marvell shareholders because Google has a financial incentive in keeping Marvell’s stock price as high as possible. Jensen Huang gave me a reason to buy. Google gave me a new reason to stick with it. But with Marvell’s stock 44% off the June 29 lows, it’s hard to argue that expectations are anything but high:And on Friday, we saw an interesting piece of news from Marvell competitor Broadcom (AVGO), which makes me think…The Banks Might Be the Best “Secret” AI StocksBloomberg reported that Broadcom is looking to raise more than $60 billion in its newest AI debt financing deal.2026 has seen a wave of capital raises from the likes of Amazon (AMZN), Alphabet (GOOGL), Nebius (NBIS), CoreWeave (CRWV), Iren (IREN), Terawulf (WULF), and so on. And that money is going straight into AI infrastructure. Plus, it’s a major IPO year with SpaceX (SPCX), Cerebras Systems (CBRS), SK Hynix (SKHY), and eventually Anthropic, OpenAI, Databricks, and Stripe. And the M&A market has been quite strong thanks to megadeals like the Paramount/Warner Bros combination. This means lots of deal fees for investment banks like Morgan Stanley (MS) and Goldman Sachs (GS), regardless of which actual AI companies end up dominating. And as long as AI doesn’t put the bankers out of business (it won’t), Wall Street will print money from AI-related dealmaking. So they are next on my buy list.The Great Biotech Short SqueezeThe State Street SPDR S&P Biotech ETF (XBI) is up over 36% in 2026, putting it at #3 on our ETF leaderboard:Biotech got a turbo boost this week when Moderna (MRNA) announced successful trial results for an mRNA vaccine for melanoma. But what many people are missing about the biotech boom is the impact of short squeezes. The XBI ETF itself has short interest of 116%, because ETF shares can apparently be borrowed and shorted multiple times. And the average stock in the XBI ETF has short interest of 14.3%. For comparison, the average short interest of a stock in the VanEck Semiconductor ETF (SMH) is just 4.0%.Traders Are Still SkittishThe latest AAII Sentiment Survey shows that 35.5% of investors are bullish. This is the 5th straight week of below-average bullishness, which I chalk up to stubborn inflation (I mean the real inflation we feel, not government numbers) and other economic concerns. So even with equities near record highs, the crowd is unwilling to say “I love this and we’re going higher.” On balance, this is positive because it implies a lack of euphoria. Meanwhile, the CNN Fear & Greed Index, is at 57, indicating modest Greed. So sentiment remains neutral overall. There just aren’t strong feeling on either side.Technically, this is the fourth straight week of below-average bullishness, despite a string of all-time highs. I take this as positive, because it implies there is still a lot of doubt facing this market. Meanwhile, CNN’s Fear & Greed Index is at 65/100, signifying modest Greed:By the way, are you looking to advance your trading skill and build a sustainable career?Next Week’s Calendar Is StackedAside from Nvidia and Marvell’s earnings, we have a lot going on next week. In economics, we have CB Consumer Confidence, Core PCE Price Index, GDP, and Durable Goods. And of course there’s a chance Fed Chair Kevin Warsh makes a market-moving announcement at Jackson Hole on Friday. And on the earnings side, we’ll be watching CrowdStrike (CRWD), Salesforce (CRM), AutoDesk (ADS), and Workday (WDAY), which will give us key insights on software demand amid concerns about encroachments from AI. Here’s the full calendar:The Pristine Mentorship Is Open Sami Abusaad and James Rich Young’s Pristine Mentorship is open! In this video, they take you through how to build a trading plan, then tell you all about the program. Highly recommended:
Continue Reading -->This Micron Chart Is Insane
What a week! Our hero SanDisk (SNDK) delighted investors with its Investor Day, earnings season kept on cruising along, and the CPI/PPI reports helped quell fears over inflation. So let’s dig into the 5 things you need to know about markets right now. Use the table of contents to skip ahead: Skip Ahead! It Was a BAD Week for Michael Burry and AI ShortsThis Micron Chart Is InsaneEarnings Season Has Been Amazing4 Reasons SanDisk Is KINGTraders Are a Little Bearish It Was a BAD Week for Michael Burry and AI ShortsMichael Burry of “The Big Short” fame made headlines this week. Among other moves, he increased his Micron (MU) short and put on a big QQQ put options position. The problem is that AI shorts are getting crushed. First, SanDisk’s (SNDK) Investor Day was very well-received, pushing up other AI stocks like Micron in sympathy. Second, did you see the monster post-earnings moves in Nebius (NBIS), CoreWeave (CRWV), and Lumentum Holdings (LITE) this week? They are the three most heavily shorted stocks in the Nasdaq 100.And they are among the top-10 performers in the index this month. Plus the QQQs have been grinding up, which eats away the value of put positions. So let’s talk about what makes shorting a stock like Micron so tricky.This Micron Chart Is InsaneHistorically, memory and storage have been highly cyclical. But thanks to the AI boom, demand is outstripping supply like never before. Micron can’t even meet half of customer demand, based on comments from a KeyBanc conference. Customers are insensitive to memory prices, and some are signing deals out to 2030. This supports the “this time it’s structural, not cyclical” argument. And if we look at historical earnings for Micron, you can see how things have changed.In the last two cyclical earnings peaks, Micron earned: -$2.59 per share in Q3 2022-$3.53 per share in Q4 2018 But in Q3 of 2026 the company earned $25.11 per share. By shorting Micron, you are saying this is the peak. But look at that chart again. If Micron can earn $25 a share in a quarter, how can you count out $50? Or $100? And the memory/storage boom is just one reason…Earnings Season Has Been AmazingQ2 earnings season has been absurdly strong, according to FactSet data. Q2 revenue growth is tracking at 15.0%. Back on June 30, analysts expected just 12.2% growth.This is the highest since Q4 2021, when the economy was rebounding from the Pandemic lows. The tech sector has been a major contributor with 35.9% growth thanks to huge numbers from AI-driven names like the aforementioned Micron and SanDisk. We can always say the most obvious thing in the world: “It can’t get much better than this.” But even 3 years ago, people were saying the AI bubble was going to pop. And AI spending just keeps going through the roof as companies trip over themselves to buy servers, GPUs, memory, and other hardware. Speaking of SanDisk…4 Reasons SanDisk Is KINGSanDisk’s Thursday Investor Day was going well. And then the company said it would return 100% Excess Cash to Shareholders. Then things started going REALLY well. The stock took off like a rocket:That was great for my 1,000 shares of SanDisk! Oh, excuse me. That was a typo. I own 1 share of SanDisk. (as in ONE) But the bull case here is obvious:Solid revenue growth back by long-term customer agreementsDirt-cheap valuationSuper-high margins and cash flowThe company will buy back tons of stock in the years to comeOf course, it’s hard to chase a stock that’s up 587% year-to-date. (my entry was $1,587 so I’m not pretending I caught it early) BTW, you can get David Prince’s takes on SanDisk and the AI landscape here:Traders Are a Little BearishThe AAII Sentiment Survey shows that investor sentiment is just all over the place week to week. 34.7% of investors are bullish, which is slightly below the long-term average of 37.5%.Technically, this is the fourth straight week of below-average bullishness, despite a string of all-time highs. I take this as positive, because it implies there is still a lot of doubt facing this market. Meanwhile, CNN’s Fear & Greed Index is at 65/100, signifying modest Greed: See you next week kids!
Continue Reading -->Nvidia: The Force Awakens
What a week! We had a light jobs report. SanDisk (SNDK) and Western Digital (WDC) hit me where it hurt (my account). And SpaceX delivered its first earnings report as a public company. So let’s jump into what you need to know right now, including the earnings season boom, Nvidia’s (NVDA) monster comeback… and even how Caterpillar (CAT) turned into an AI stock.Earnings Season Has Been Awesome. But Not for SanDisk.Q2 earning season has been ridiculously strong, according to FactSet data. 86% of reporting companies have beaten EPS estimates, the highest percentage since Q2 2021. And earnings are coming in a ridiculous 29.2% above expectations, the highest since at least 2008. Excluding Alphabet (GOOGL) and Amazon’s (AMZN) large one-time investment gains, earnings would still be 10.9% above estimates. Earnings growth is tracking at a whopping 32.0% excluding GOOGL and AMZN. Unfortunately, our biggest, brightest shining star SanDisk (SNDK) got taken to the woodshed. The flash memory maker delivered a strong report, but its guidance disappointed and the stock got smacked around. The same happened with Western Digital (WDC). Now SanDisk is almost 50% off its highs! But fun fact: SanDisk is still the #1 stock in the S&P 500 index this year: Get JR Romero’s latest take on SanDisk here.Meet the Guidance MonsterLast Friday, I said power management semiconductor stock Monolithic Power (MPWR) may be the new SanDisk. And I bought the stock on Monday. SanDisk and Western Digital’s (WDC) guidance disappointments took them out of a unique category of AI stock I call “Guidance Monsters.” These are the AI stocks that deliver revenue guidance so strong that even the biggest bulls can’t believe it. Monolithic Power is seeing wild demand from data center clients. And last week, its Q3 revenue guidance came in 17% above consensus. You have to think that the company plans to handily beat that guidance. See the lines going up and to the right? Those are consensus earnings estimates:This is exactly what you want to see with high-octane growth stocks. Note: I also own SanDisk and Western Digital, so I didn’t have a bang-up week on the AI front.The Nvidia Value Trap Debate Ends for NowI’ve been suggesting Nvidia might be a value trap based on its cheap valuation. That was dead wrong because the stock just woke up:This week, the stock got a nice boost when Elon Musk said SpaceX (SPCX) will exclusively buy Nvidia chips over AI chipmakers like AMD (AMD). I’ve been wondering myself where Nvidia could find its next big customer, and SpaceX may be just that. I have my doubts about how soon we’ll see fully operational data centers in space, but SpaceX’s capex spending is going through the roof. JP Morgan said “we now project capex of nearly $200B in both 2027 & 2028.” A decent chunk of that will flow through to Nvidia.It’s Gonna Be Another Busy Week for AIWhile most big companies have reported, multiple key AI/semiconductor names will report earnings next week, including: Tuesday: Lumentum Holdings (LITE), CoreWeave (CRWV), Super Micro (SMCI)Wednesday: Cisco (CSCO), Coherent (COHR), Cerebras Systems (CBRS)Thursday: Applied Materials (AMAT) So we’ll have even more inputs to help us deal with the ultimate question: Will the spending ever stop? Everyone from Alphabet (GOOGL) to Meta (META) to Amazon (AMZN) to SpaceX is throwing wild amounts of money at AI infrastructure projects. Heck, Caterpillar (CAT) raised guidance because of AI data center buildouts. So maybe we’ll add CAT to our list of AI stocks… Here’s the full calendar for next week:Traders Are… Confused?The AAII Sentiment Survey shows that investor sentiment is just all over the place week to week. 37.0% of investors are bullish, which is right in-line with the long-term average of 37.5%. This follows two straight weeks of bearish readings.This continues the trend of there being no real trend from week to week. Meanwhile, CNN’s Fear & Greed Index popped to 63/100, signifying modest Greed: Of course, if the market dips 2% next week, sentiment will swing back bearish in the blink of an eye. So it’s getting harder and harder to make sense of sentiment data, because there’s never any sustained string of positive or negative readings. Oh well… Have a great weekend!
Continue Reading -->The Next AI Chip King?
What a week! Microsoft (MSFT) and Amazon (AMZN) dropped beautiful earnings reports. Kevin Warsh delivered a short and sweet FOMC statement. And hedge fund Situational Awareness choke on leveraged AI stock bets before a rescue by Ken Griffin’s Citadel. Now let’s drill down for the most interesting things happening in markets now. We go over what’s been an awesome earnings season, a candidate for the next AI chip King, and 2 semiconductor stocks that appear to on the edge of greatness… or failureEarnings Season Has Been Awesome27% of S&P 500 companies have reported, according to FactSet.And the numbers are pretty dang amazing.86% of companies reported positive EPS surprises. And 80% beat revenue forecasts.The strongest numbers are coming from the financials, tech, and energy. And utilities are lagging.Q2 EPS growth is tracking at 37.9%, the highest growth rate since Q3 2021, which had the benefit of an easy year-over-year comp from the pandemic:That 37.9% number was boosted by a $98 billion one-time gain by Alphabet (GOOGL). Excluding that, earnings growth is still tracking at 25.9%, which is still spectactular. Plus that 25.9% was calculated before this week’s beats by Microsoft (MSFT), Amazon (AMZN), Apple (AAPL), Seagate (STX), Lam Research (LRCX) and Monolithic Power (MPWR). And odds are we’ll see positive earnings surprises from Palantir (PLTR), AMD (AMD), SanDisk (SNDK), and Western Digital (WDC) next week.Interestingly, the data shows that the market is not reacting well to reports. This goes for companies that beat AND companies that miss. So Microsoft and Amazon’s booms this week were exceptions to the rule!We May Have a New AI Semiconductor KingI’ve heard of the company Monolithic Power (MPWR), but never paid any attention to it. Until I saw its earnings report on Thursday, July 30. MPWR reported $980.6 million in sales, 9% above consensus. EPS was 11% above estimates. And revenue guidance for next quarter was 17% above expectations, which reminds me of SanDisk since it came public again last year, and Nvidia in 2023. Look at how fast analyst estimates are rising:Again, just like prior boom periods for SanDisk and Nvidia. And what does Monolithic Power do? It designs and develops power management solutions that go into everything from AI GPUs and TPUs to batteries to robots. And it’s seeing booming demand for AI data center and server applications. With a $72 billion market cap, this isn’t exactly a top-secret micro cap, but there’s surprisingly little discussion about it. So put Monolithic Power stock on the radar. It could be the next SanDisk, and it’s at the top of my personal watchlist. Related: check out JR Romero’s Greatest Hits: SanDisk Edition.The Nvidia Value Trap Debate ContinuesLast week, I suggested Nvidia might be a value trap at 21X forward earnings. Well, now it’s trading at 20X forward earnings, even with Microsoft (MSFT) and Amazon (AMZN) showing huge cloud and AI growth.This is Nvidia’s cheapest valuation in decades. The problem remains the same. Nvidia is so well-known that it’s hard to deliver a major positive surprise. And major AI infrastructure tech buyers like Alphabet and Amazon have made major strides in developing chips in house. Which means more competition for Nvidia’s high-priced GPUs. Plus from a basic market mechanics perspective, attention and money has shifted to the memory/storage names, which are posting much bigger earnings beats and upside guidance. Sure those stocks are more volatile, but that’s where the momentum money goes when the market is in a good mood,SK Hynix Is in for a FightKorean memory superpower SK Hynix (SKHY) made a huge splash when it listed in the US on Friday, July 10. The $26.5 billion deal priced at $149 per share, and the stock hit $194.80 on July 14, its 3rd day of trading. On July 29, it hit a low of $124.80 after an Earnings Miss. It’s since rebounded to $149+. But now the fight begins. 2026’s other two big IPOs have been messes. SpaceX (SPCX), which also made a high on its third day of trading, is down over 60% from its peak. (FYI: SpaceX delivers its first earnings report on Tuesday, August 4 after the close) Cerebras Systems (CBRS) made itsarecord high on its May 14 IPO day, and has since dropped about 50%. And aside from sagging sentiment towards these mega-issues, traders are concerned about Chinese memory giant CMXT disrupting the likes of SK Hynix, Micron, and Samsung.Traders Are… Bearish?The AAII Sentiment Survey shows that the topsy-turvey downside action in tech stocks may be impacting the mood. Just 31% of surveyed investors are bullish, which is the second straight week of below-average bullishness.So it looks like the crowd is leaning bearish. The tricky thing with sentiment data is that it’s lagging, and AAII tends to bounce around from week-to-week. However, if we get another below-average reading next week, that could signify real negativity. Meanwhile, CNN’s Fear & Greed Index is at 38/100, signifying modest Fear.
Continue Reading -->The 2 Ugliest Charts in the World
What a week! Alphabet (GOOGL) failed on earnings and there’s no peace in the Middle East. So let’s go over: The 2 ugliest charts in the world Why it’s hard to be an AI hyperscaler right now Why Nvidia may be a value trap Where sentiment sits Let’s go. Ugliest Chart in the World #1 SpaceX (SPCX) was hot for 4 days. Now it’s been cut in half. We identified $150 as an obvious line in the sand. And SpaceX just cut through it like a knife through butter: And let’s give credit to Sami Abusaad! He got short at $154.89 and has been riding it down the whole way. So why is this stock getting dumped? Because the more the stock drops, the more attention is paid to the danger on the horizon (insider lockup expirations). That’s created a race to the exits. Meanwhile, Wall Street banks (many of whom earned paid big fat IPO underwriting fees from SpaceX) love the stock. According to Koyfin, the average analyst target price is $236.71: So they think SpaceX will double. Do you? Now let’s talk about its twin… Ugliest Chart in the World #2 This is Oracle (ORCL) over the past year. Oracle has a major problem. It’s a hyperscaler with potential credit problems. While other AI stocks like Microsoft has heaps of recurring revenue and free cash flow to reinvest in capital expenditures, Oracle does not. Just so you understand the difference in scale here, Microsoft generated almost $73 billion in free cash flow over the past 12 months. Oracle (ORCL) had NEGATIVE free cash flow of almost $24 billion. So it has to borrow tons of debt to power its AI dreams. Maybe too much. It’s Hard Out Here for a Hyperscaler The AI market remains split between “haves” and “have nots.” The AI hyperscalers are most certainly have-nots in 2026, given these performance numbers: Alphabet (GOOGL): +2.8% Amazon (AMZN): +2.3% Meta (META): -7.9% Microsoft (MSFT): -19% Oracle (ORCL): -36% Meanwhile, the VanEck Semiconductor ETF (SMH) is up a whopping 61%. This makes sense because the hyperscaler buildout is a wholesale transfer of cash flow to the likes of Nvidia (NVDA), AMD (AMD), ASML (ASML), Micron (MU), SanDisk (SNDK), etc. Think of it this way. Google sucks up money selling ads. Then that money goes straight to hardware and chips from the likes of Nvidia, AMD, Micron, Dell, etc. Which flows down to networking gear, semiconductor equipment, etc. At some point the trend reverses, but for now – hardware looks like easy money. Especially when we have Alphabet raising its capex forecast. And Meta, Microsoft, and Amazon might do the same when they report earnings this week. Is Nvidia a Value Trap? Many traders and investors are zeroing in on Nvidia’s (NVDA) valuation. The stock is now trading at 21x forward earnings, which looks cheap for the flagship AI chip name: But I wonder if Nvidia is a value trap. As in, it looks cheap but goes nowhere. I see Nvidia’s biggest challenge as a lack of sex appeal relative to other places within the AI landscape. Right now, the market is excited about the memory and storage names, because that’s where the biggest supply-demand imbalance is. On Thursday’s earnings call, Intel (INTC) CEO Lip-Bu Tan said “…memory has become the big supply constraint challenge.” Yes, Nvidia is most likely still supply-constrained. Just not at the level of a Micron (MU) or SanDisk (SNDK). But we’ll know for sure this coming week. If we see Meta, Microsoft, and Amazon signal higher capex spending and Nvidia does nothing, then maybe the thrill really is gone. We’ll see. In the meantime, I recommend watching this interview with Cerebras (CBRS) CEO Andrew Feldman, who shares some interesting points about the AI chip universe. He discusses why Nvidia’s CUDA platform may be losing its competitive moat, though you should obviously take that with a massive grain of salt: Investors Are Bearish… for Now The AAII Sentiment Survey shows that just 29.6% of investors are bullish. This is well below the 37.5% long-term average. And it’s a massive decline from last week’s 44.9% reading (above average bullishness). So are investors bearish? Kind of. These sentiment surveys have been topsy-turvy all year, so we never get any sustained bullishness or bearishness. That reduces the predictive power of these numbers, which wasn’t all that great to begin with (outside of real extremes). Meanwhile, the CNN Fear & Greed Index is at 41, which is slightly fearful. Add it up and it looks like investors are far from euphoric. But they’re not down in the dumps either.
Continue Reading -->The 5 Horsemen of the AI-pocalypse
What a week! We may have peace in the Middle East, SapceX is fighting for its life, and we have a new AI powerhouse trading in the US: Meet the 5th Horseman, SK Hynix I called these stocks the 4 Horsemen of the AI-pocalypse: SanDisk (SNDK) Micron (MU) Western Digital (WDC) Seagate (STX) AI has created unprecedented demand for storage and memory to the point that they comprise 4 of the 5 best S&P 500 stocks this year: And now we may have a new horseman in the form of South Korean memory giant SK Hynix (SKHY), which had a blockbuster US market debut Friday. The $26.5 billion deal priced at $149 per share, and the stock was trading around $169 as of 2:33 pm ET. Pretty solid first day. And CEO Kwak Noh-jung is telling the right story. He told Reuters “We forecast that next year will be the worst year in the industry’s history from the supply perspective.” And he added that demand will exceed supply beyond 2030. Nothing drives momentum like a massive supply-demand imbalance. So I’m making SK Hynix a probationary “5th Horseman of the AI-pocalypse.” Get David Prince’s take on SK Hynix here: Meanwhile, another high-profile IPO is fighting its own battle: SpaceX Fights for $150 We all know the bear case for SpaceX (SPCX). IPO lockup expirations will flood the market with shares. The valuation is outrageous. The Nasdaq 100 addition didn’t help the stock. At the same time, it is stubbornly holding the $150 area: That looks like a major psychological line in the sand. And maybe this situation is as simple as a hard break above or below this level will dictate the next big move. For more on SpaceX, check out this video: And since we’re on the topic of IPOs and AI… Bank Earnings Should Be HUGE This Year This coming week, we get earnings from the big banks like JP Morgan (JPM), Goldman Sachs (GS), Bank of America (BAC), and Morgan Stanley (MS). And now that I think about it, maybe the banks are a stealth AI play. Especially the capital markets focused names like Goldman and Morgan Stanley, which are up nicely in 2026: Aside from the massive SpaceX IPO and the prospective OpenAI and Anthropic deals, there’s been a ton of capital markets activity related to AI, like: Alphabet (GOOGL) raising $85 billion in equity Oracle (ORCL) raising $40 billion to help fund its AI buildout Super Micro (SMCI) raising $7 billion to buy components to fill new $39 billion in AI server orders According to Crunchbase, global venture funding hit $510 billion in the first half of 2026. That compares to $440 billion for all of last year. Crunchbase also said that this is the strongest exit market since 2021. All this capital markets activity should mean fat fees for Wall Street banks. Earnings Season Is About to Go BOOM Q1 earnings season was huge, thanks to massive beats in tech, particularly in the semiconductor industry. As noted above, this coming week, Q2 results kick off with the likes of JP Morgan (JPM), Netflix (NFLX), and ASML (ASML). I’d argue ASML is the biggest report of the week since it sells into the AI/Semi giants like Samsung, AMD (AMD), SK Hynix (SKHY), Micron (MU), Intel (INTC), and Taiwan Semi (TSM). Note: Taiwan Semi also reports next week. There’s a whole lotta optimism out there. FactSet data shows that 111 S&P 500 companies issued guidance. 57% issued positive guidance, well above the long-term average of 41%. This is the highest percentage of companies issuing positive guidance since Q3 2021. And tech guidance is at a record high. Analysts are also pumped. They are now estimating 23.3% growth, up from 18.8% on March 31. And looking forward, Q3 growth is forecast at 26.8%, and Q4 is 24.1%. This is bad. Because the bar is very high. Plus, if results come in as expected or better, we are going to be facing some tough year-over-year comparisons next year. But even as companies and analysts are positive, investors and traders show no signs of joy: Sentiment Remains Neutral The AAII Sentiment Survey shows that 36.3% of investors are bullish. This keeps sentiment in neutral territory. And while we’ve had a few positive or negative readings here and there, there hasn’t been a true extreme reading (in either direction) since early 2025. Meanwhile, the CNN Fear & Greed Index is at 47, smack in the middle at neutral. On balance, this is all bullish because it shows little euphoria on the part of market participants.
Continue Reading -->How Meta Can Hit $1,000
We’re cruising into the July 4 holiday so let’s take a look at the 5 things you need to know right now. How Meta Can Hit $1,000+ On Thursday, Bloomberg reported that Meta (META) is planning a cloud infrastructure business called “Meta Compute” to sell excess compute capacity for AI and other applications. If this is real, it would put Meta in competition with the likes of Amazon (AMZN), Microsoft (MSFT), and Alphabet (GOOGL). You could argue this a million different ways. The bears will say Meta should not have excess compute capacity, and it’s entering battle with aggressive competitors. Or maybe this gives Meta the potential for a higher valuation because it’s hitching a more direct ride to the growth of AI. But I ask myself, couldn’t Meta make way more money by just selling ads to AI companies? This seems like the easy money instead of rolling the dice with hundreds of billions in AI infrastructure investments. Yes, Meta should use AI for things like improving ad targeting and speeding up code development. Everybody knows that. But it seems far smarter to be the cash register counting up all the ad dollars from OpenAI, Anthropic, etc. Call me crazy. But if Meta backs off from its wildly aggressive AI spending plans, I think it’s going straight to $1,000. Because earnings estimates will go through the roof. The problem is that this could take years. I mean, how long did it take before they realized the Metaverse sucked? Techflation Is Here In 1965, Intel (INTC) co-founder Gordon Moore observed that the number of transistors in a chip would double about every two years, with the price dropping by half. That was declared “Moore’s Law.” It’s something of an outdated concept for technical reasons. For example, transistors can only get so small. But what if AI, to some degree, has given us Moore’s Law, only upside down? Prices for SSDs, DRAM, CPUs, and even old-school spinning hard drives are going up. This SanDisk (SNDK) SSD drive cost T3 Live $150 in January 2023: Today, it’s going for $280+ on Amazon: News reports indicate that Intel is raising prices for desktop CPUs. These are not super-powered AI chips. But it looks like we have an upward pull on everything related to computers, smartphones, and tablets. If people are paying higher prices for SSD drives, why not everything else too? Recently, Microsoft (MSFT) announced higher prices for its Xbox video-game consoles. It expects storage and memory prices to double by the fall of 2027. And Apple (AAPL) jacked up prices on Macbooks and iPads. Welcome to techflation. Did Warsh and the Jobs Report Shift FOMC Expectations? The Nonfarm Payrolls report was slightly light today. And yesterday Fed Chairman Kevin Warsh said inflaation risk are declining. So have FOMC rate hike expectations shifted lower? Nope. The CME’s FedWatch tool shows that markets are pricing in a 79% chance of higher rates by year-end. This compares to 83.1% yesterday and 80.8% a week ago. So nothing’s changed on that front. And the expectation of higher rates is boosting this name: Robinhood Rockets! Sami Abusaad has been super bullish on Robinhood (HOOD). And it’s been on a tear: One reason is the expectation of higher interest rates. Higher rates means bigger profits on margin loans. And margin loans have been at record levels. Plus, based on Interactive Brokers’ (IBKR) June 2026 numbers, we can assume Robinhood is seeing heavy trading volumes. And if the crypto market can turn the corner, that would give Robinhood even more rocket fuel. Crypto revenue has been a sore spot for Robinhood, so if that reverses, it could be off to the races at an even faster pace. FYI: IBKR is one of my biggest positions. Wait. Are Investors and Traders Bearish? The AAII Sentiment Survey shows that investors flipped back to bearish this week. Just 31.4% of investors are bullish on stocks for the next 6 months, a substantial drop from last week’s 44.9%. This is the sixth bearish reading in the last seven weeks. It seems like folks are still worried about the economy, the direction of the FOMC, and the sustainability of the AI/semi boom. Meanwhile, CNN’s Fear & Greed Index is at just 31, indicating moderate fear. Plus, the CBOE’s equity put-call ratio is at 0.69, which is in the neighborhood of neutral. No sentiment indicator can help you nail the market every time. But rampant euphoria often coincides with market tops. And we are nowhere near that.
Continue Reading -->Micron Put Apple to the Test
What a week! Micron (MU) dropped a blockbuster earnings, report, Apple (AAPL) raised prices, and oil came crashing down. Let’s talk about what’s going on in this fun-filled market: This Really Is the 90’s Era All Over Again It’s been hard out there for the AI hyperscalers like Meta (META), Alphabet (GOOGL), and Microsoft (MSFT), who are spending ungodly amounts of cash on hardware like memory, storage, and networking equipment. That means they are transferring their cash flow to companies like SanDisk (SNDK), Intel (INTC), Western Digital (WDC), and this week’s earnings superstar Micron (MU). So it’s no shocker that the 2026 S&P 500 leaderboard looks like this: Virtually all of these companies cashed in by selling picks and shovels in the 1990’s Internet boom. Now it’s rinse and repeat with AI. Instead of Pets.com and Ask Jeeves and American Online, the end application is Claude or ChatGPT! Just look at Micron’s monster earnings report on Wednesday. They beat revenue expectations by 16%. SanDisk beat by 26% in its last quarter. These picks and shovels (DRAM, flash memory, and even freaking old-school hard drives) are getting so expensive that Apple (AAPL) just raised prices on MacBooks and iPads. And that means… Apple Is Being Put to the Test Apple has an affluent user base that is willing to pay premium prices for a superior user experience. And this MacBook/iPad price hike feels like a test for something even bigger: iPhone price increases. Last quarter, Mac and iPad sales accounted for just 14% of total sales. So when Apple drops its next earnings report (about one month from now), we’ll see how much customers are willing to pay up for the brand. I suspect Apple will do fine because its devices are more or less consumer staples. Some people will choose cheaper models. But who’s going to give up their screens in 2026? Or even worse – switch to Windows/Android? I’m in the market for a new phone myself, and I’d rather pay an extra $100 to $300 to Apple than deal with an inferior user experience. I’m an Apple shareholder, so I won’t pretend I’m unbiased. SpaceX Plays Great Defense I sold my SpaceX (SPCX). And I might have screwed up. Because this stock has been doing a great job of holding that $150 area: We all know the issues with this company. It’s overvalued. A ton of shares will hit the market when lockups expire. We might not see a data center in space for many years. But the buyers keep stepping up This could be a situation where the bear case is way too obvious to be right. At least for now. Because those lockup expirations will pack a big punch. Are We Getting the Fed Wrong? The market continues to brace for higher rates. The CME’s FedWatch Tool shows that the market is pricing in a 77% chance of higher rates by year-end. This hasn’t changed much over the past month. But it is a pretty big sea change from earlier in the year, when we were debating how many cuts we’d see. Though interestingly, this chart from Apollo has been making the rounds: The market is almost always wrong about what the Fed will do, per Apollo: pic.twitter.com/yluOOKYynD — unusual_whales (@unusual_whales) June 26, 2026 Apollo argues the market is usually wrong in sniffing out Fed policy. Which makes sense because the Fed itself isn’t very good at predicting anything. Remember when inflation was “transitory” for about 98 straight years? So maybe, just maybe the smart move is to bet on lower rates? Sentiment Suddenly Flips Bullish. Sort Of. The AAII Sentiment Survey shows that 44.9% of investors are bullish on stocks. This is a big jump from 36.9% last week. And it’s the first above-average bullish reading since May 13. The market peaked on June 2 at SPX 7620, so it took a few weeks for the mood to catch up. And during that time, the market’s slipped a bit. On balance, it would be better to have less bullish sentiment, because it implies there are still doubters on the sidelines. However, this is still far from euphoric sentiment, which we haven’t had in quite some time. Meanwhile, CNN’s Fear and Greed Index is at just 25, in the extreme fear category. Keep in mind Fear and Greed is calculated by market indicators, while AAII is determined by an actual survey, reflecting people’s actual feelings. Add it up and investors/traders are ‘sorta’ bullish.
Continue Reading -->SpaceX: The Hard Questions Are Here
Peace is coming (hopefully) to the Middle East, sending oil lower while equities stabilized. But if you expected a sleepy summer, you’re disappointed. Because this market remains action-packed. So let’s talk about what’s happening: SpaceX Comes Down to Earth Last Friday, SpaceX (SPCX) came public in the biggest IPO of all time. And it hit Earth with a bang. The deal priced at $135. The stock opened at $150 on the dot and hit a high of $225.64 on Tuesday, from where it started sliding: Even after this 20% drop, its $2.36 trillion market cap is larger than: Broadcom (AVGO) Tesla (TSLA) Meta (META) Micron (MU) Walmart (WMT) JP Morgan (JPM) Analysts expect SpaceX to grow revenues from $35.9 billion this year to $130.9 billion in 2029. Elon Musk himself said he expects SpaceX to generate about $1 trillion in revenue in 2030. But now the tough questions are coming: Was the entire rally engineered through limiting the supply of stock and giving more retail traders access to the IPO? Can Elon Musk sell SpaceX the way he’s sold Tesla? Even if SpaceX can hit growth targets, is the valuation out of control? Will the stock collapse when insiders get the green light to sell? Will the company have to raise even more capital? There are now reports of a potential $20 billion bond offering on the way. I own a whopping 10 shares of SpaceX myself. And I’m thinking about selling, and buying some out-of-the-money puts. Because if SpaceX crashes, it’s bound to be ugly. JR Romero had some harsh words for SpaceX (the stock, not the company) here, and we went deeper into the potential dangers facing this iconic name: The Epic Semiconductor Run Won’t Stop, and Has Another Catalyst The VanEck Semiconductor ETF (SMH) might be incapable of going down. It’s up 83% this year and hit another record high on Friday thanks to big moves in names like Intel (INTC), Taiwan Semi (TSM), and AMD (AMD). And it would be up even more if SanDisk (SNDK) was in the ETF. SanDisk is the #1 stock in the S&P 500 this year with its 819% gain. Plus, there’s another catalyst on the horizon: Micron’s (MU) earnings report on Wednesday after the close. Based on the number of AI-related capital raises we’re seeing from the likes of Alphabet (GOOGL), Nvidia (NVDA), SpaceX, and others, demand for memory remains insatiable. So Micron should extend what’s been a monumental winning streak for semiconductor earnings. Warsh Confirms the Drift Towards Higher Rates New FOMC Chairman Kevin Warsh made a big splash at his debut meeting on Wednesday. Warsh shortened the post-meeting statement, ditched the dot plot, announced five new task forces, and declared war on inflation. Warsh’s hawkish show came as a surprise to many because he was viewed as a loyalist to President Trump, who has been vocal in wanting lower rates. And 9 of 18 Fed officials now expect at least one rate hike this year. The market was already leaning in the direction of higher rates, and the Fed reinforced that. Now markets are pricing in an 85% chance of higher rates by year-end, according to the CME’s FedWatch Tool. So the breakdown of expectations is now as follows: 15% chance of rates staying unchanged 37.6% chance of 25 bps in hikes 33.3% chance of 50 bps in hikes 12.5% chance of 75 bps in hikes 1.7% chance of 100 bps in hikes This isn’t a major change from last week. It was more a reinforcement of what the market is looking for. Still, I’m eager to see if the President starts tangling with the independent-minded Warsh. Stocks Go Up, Traders Go “Meh” The latest AAII Sentiment Survey shows that 36.6% of investors are bullish. This is up from last week. But it’s still the 5th straight week of below-average bullishness. That’s even with equity markets hitting record highs, and a US-Iran deal coming together. Meanwhile, CNN’s Fear & Greed Index is at 37, smack dab in the Fear category. But overall, the numbers are healthy because it shows that not everyone is bought into this rally. The last thing we need is euphoric sentiment, which typically happens around tops.
Continue Reading -->The SpaceX IPO Was Boring?
We’ll skip the preambles this week. You know what you want to hear about: 1. SpaceX IPO = Boring? The SpaceX (SPCX) IPO is a hit. The deal priced at $135, and the stock opened at $150 before hitting $176+. That was a sizable move, but it felt rather almost too orderly. Just boring. I expected more back-and-forth violence because of the crazy day-one action in Cerebras (CBRS) in May, along with the presence of Elon Musk cultists, and the huge valuation assigned to SpaceX. It felt combustible. But as of 1:25 pm ET Friday, this feels like an anticlimax in terms of volatility. It’s downright boring. I picked up a whopping 10 shares of SpaceX at the offering, so I’m not complaining. Every tick higher is good for me. Now it will be interesting to see if Elon’s true believers stick with the stock and hold it up. You can get our team’s full reaction to the IPO here: 2. SpaceX Sets a Hilarious New Mark for Leveraged ETFs This morning, Defiance ETFs relaunched their Defiance Daily 2X Space ETF (SPCL), saying this: “Effective June 12, 2026, all or a predominant portion of SPCL’s Target Portfolio consists of exposure to SpaceX (Nasdaq: SPCX), making SPCL the world’s first and only ETF to have 2X exposure to SpaceX on IPO day. The fund’s SpaceX exposure was established at the $135 IPO price.” So we got a leveraged SpaceX ETF the same day as the IPO. And it was trading before SpaceX opened at 11:46 am ET. Based on the Defiance website, it looks like the SPCL ETF went to cash before buying 52,888 shares of SpaceX at the $135 IPO price. That’s why SPCL has a trading history. And it had a notable price and volume explosion today: It traded just 49K shares Thursday, but was at 941K on Friday as of 1:42 pm ET. However, “normal” SpaceX leveraged ETFs will hit the market soon after the SEC delayed listings to avoid mucking up the IPO. 3. SanDisk Refuses to Stop On May 29, JR Romero predicted SanDisk (SNDK) hitting $2,000. And it crossed that mark today. Close enough for government work? The stock is now up 717% year-to-date, making it the #1 stock in the S&P 500 by a long shot. The #2 name Micron (MU) is up “only” 249%: And as you can see, the leaderboard is dominated by semiconductors and tech hardware names. Because it feels like there is near-unlimited demand for AI hardware, based on recent news like: Oracle (ORCL) raising $40 billion to help fund its AI buildout Alphabet (GOOGL) selling $80 billion in equity to expland AI infrastructure Super Micro (SMCI) raising $7 billion to buy components to fill new $39 billion in AI server orders And a lot of this money is going towards flash memory, DRAM, hard drives, processors, and all the other stuff that powers AI. 4. Higher Rates? The ECB raised rates on Wednesday and traders are thinking the US will follow suit following the hot CPI and PPI reports. The market is now pricing in a mere 39.4% chance of rates remaining unchanged for the rest of 2026. This is down from 61.8% a month ago. And now the following rate hike odds are being priced in: +25 bps: 41.0% +50 bps: 15.1% +75 bps: 2.1% +100 bps: 0.1% So in total: Traders are pricing in a 58.3% chance of higher rates by year-end. Remember when we debated how many cuts we’d get? Of course, next week we get the first FOMC announcement and press conference from new Fed Chair Kevin Warsh. It will be interesting to see what tone he sets to kick off his term. And if he’ll signal he will go along with President Trump’s wish for lower rates. 5. Sentiment Is Bearish? The latest AAII Sentiment Survey shows that 30.4% of investors are bullish. This is the lowest reading since March 18, when the S&P 500 closed at 6224. It’s also the fourth straight week of below-average bullishness. AAII says the #1 concern is “the economy and/or inflation.” That makes sense given this week’s hot CPI report, plus ongoing concerns about AI taking jobs. Meanwhile, the CNN Fear & Greed Index is at just 33, squarely in the “Fear” category. So the decline from the early June highs has taken a clear toll on the mood.
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