00:00Where do you want to spend your money as a stock buyer?
00:02I do.
00:02I want to look at some of the tech stocks that
00:05have had a nice correction, where
00:07the fundamentals are strong.
00:08I want to look at some of the alternative plays that really
00:12took a hit, like the air conditioning plays in terms
00:16of companies that support data center and AI center buildouts.
00:21And I want to look at some of the alternative energy stocks.
00:25So these stocks have all taken a haircut.
00:28And I think there's a buying opportunity in here.
00:32And so in tech, it's Qualcomm for me, not NVIDIA.
00:36As you know, I've favored that.
00:38It's taken a nice hit.
00:40It's Tower Semiconductor, if you're
00:43looking for a mid-cap name.
00:44And by the way, I think mid-caps,
00:46we just launched a new mid-cap newsletter.
00:48It's called Mark Chaykin's Power Profits.
00:52And the whole thesis is that we're
00:54going to have a broadening out in participation,
00:58as this bull market keeps going.
01:00And I think you've got to move your focus away
01:03from the mega cap and the big cap names.
01:05So that's sort of the underlying thesis.
01:08And you do have what I consider the big five, which
01:13is Microsoft, Apple, Amazon, NVIDIA,
01:18all with bullish power gauge ratings.
01:20So that sector, that market cap slice is really strong.
01:25But I think you've got to start looking for mid-caps.
01:29So TSCM is one of yours.
01:31And it's actually setting up not bad.
01:33And then you're also looking at Qualcomm,
01:35which I own in my long-term portfolio here.
01:38Qualcomm's had a pretty good pullback here.
01:40Just quiet.
01:40Nobody talks about this when you're right, Mark.
01:42230 to 200, quiet little 15% sell-off here.
01:46And no rounding a little bit here.
01:48Maybe getting ready for its next leg higher.
01:50I'm just concerned.
01:51And I just want to talk over all the AI trade with you,
01:54though.
01:54I'm just concerned it's tired.
01:56I'm just concerned it's exhausted a bit.
01:58Like not saying the AI trade is over by any means.
02:00I think we're still in the early innings.
02:02And I think if you own these stocks with a five-year time
02:04horizon, you're going to be happy.
02:05But it's just like NVIDIA up 200% this year.
02:08I mean, doesn't it feel kind of tired to you?
02:12It does.
02:12And the fact that the major houses, like Morgan Stanley,
02:16are reiterating their buys and raising their targets
02:19is a red flag.
02:21But we have shifted our focus to the companies
02:26that start using AI to increase their profit margins.
02:29That's my real big theme for the next five years.
02:34Just like when we talked about this,
02:36the Netscape browser in 1995 democratized the internet.
02:41Profit margins went up for five years.
02:43Inflation came down.
02:45Rates came down.
02:46And I think that's what we're looking at.
02:48Profit margins up for the next five years.
02:50PPEs go up.
02:51Rates come down.
02:52Inflation stays pretty static.
02:56So you've got to start looking for companies
02:58that are early adopters of AI in their businesses.
03:02And mid-cap companies have an easier time
03:05doing that because they don't have
03:06the sort of bureaucracy that says, oh, we've got legacy
03:09stuff, we can't do that.
03:11They're more nimble.
03:12So you've just got to pick and choose.
03:15Eaton Corp is one that I had identified.
03:18One of my, Pete Carmesino identified it early on, ETN.
03:24So you've got to be looking for pullbacks in stocks
03:27like this where companies are actually
03:29using AI to improve their supply chain,
03:32to improve their customer interaction.
03:35So Zebra is one that I think I mentioned.
03:39I wasn't on, but a month ago because
03:41of a snafu on my calendar.
03:43But Zebra is using Qualcomm chips
03:47in their handheld scanners in supermarkets and warehouses.
03:51And they've already improved their business because of AI.
03:57They're not manufacturing anything or chips.
04:00So those are the kinds of stocks I'm really looking for.
04:03Staying away from maybe the leaders right now,
04:06like looking.
04:07Yeah, the leaders are tired.
04:09And I think the leadership is going to shift.
04:12And the old saw is that last bull market's leaders almost
04:19never lead in the next bull market.
04:22True.
04:22And by the way, Aaron raised a good point, literally
04:27to the day that Modelo passed Budweiser as the leading
04:32B or the stock, Pete.
04:34So that's like, put me on the cover of Time Magazine or Forbes
04:40and sell the stock.
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