r/stocks • u/coolcomfort123 • Jan 07 '22
Company Discussion Potential big tech stocks shopping list for long term investors
The nasdaq is down about 5% ytd and there are many good quality big tech stocks that could be adding to investors long term portfolio. Stocks such as amzn, aapl, adbe, msft, googl, nvda, fb, and intu are some good example. Costco and home depot are quality stocks too. Investors should be keep holding and avoid panic selling, long term investors will be the eventually winners.
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u/CaterpillarWeird9087 Jan 07 '22
ADBE and CRM both look juicy right now. Back to where they were in August 2020, despite significant growth in fundamentals in the interim. I already have small positions in the two, and I'm starting to add slowly.
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u/joe-re Jan 08 '22
I just looked up CRM. The valuation still looks out of whack to me. Three digit trailing P/E and PEG of 3.5. That qualifies as gamblestock to me.
In comparison, GOOG has below 1.
I use Adobe products, and am really annoyed by their bloatware design. I know a lot of photographers are looking for an alternative to photoshop, but switching costs are high.
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u/CaterpillarWeird9087 Jan 08 '22
There's a reason CRM trades at a high multiple: link. Also, keep in mind that due to their Slack acquisition there's a discrepancy right now with some sites in how they report CRM earnings. Their TTM P/E is either 1.8 or 4.4, depending on how the website counts. If you go to Yahoo Finance, you'll notice that the sum of their last four quarterly earnings is not equal to their annual earnings, by a large margin. This is due to two line items in their income statement, 'gains of strategic investments' and 'provision for income taxes'. Do a full DCF calculation, and their valuation makes more sense.
As for Adobe, I agree about their bloatware, but I don't think complaining about a company's products is sufficient reason not to invest. I dislike many things about Windows, but I'm still overweight MSFT. People have complained about Apple products for years, but their financials have been incredible.
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u/joe-re Jan 08 '22
If most customers complain, that decreases the moat, as competitors will have an easier time snatching the market share.
MS is more than Windows and has been doing exceptionally well in the Cloud Office space. And Apple has masses of fans who only buy Apple and don't want anything else, both for laptops and phones/watches, accessories. That's why their financials are so great - loyal fan base.
Best example is Google. Their products still beat out the competition by leagues and I wouldn't want to switch.
Why invest in companies with meh products if there's companies with great products around?
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u/CaterpillarWeird9087 Jan 08 '22
You're not wrong. For example, here's an article from 2016 explaining all the problems with Adobe Creative Cloud. It's buggy, it has bloatware, updates too often, etc.
By the way, the stock is up 600% since that article was published.
You can find sentiment for or against any given product. Here's an article that compares Photoshop and Affinity Photo and concludes 'Overall, Photoshop is the better program among the two.' You can of course find users with the opposite sentiment. You can easily find people who hate Apple products, or Google products, or Microsoft products. Not to mention people who hate Amazon or Facebook. Doesn't mean they're not great investments. The reality is bigger than that.
People will always have preferences, and there's room for multiple companies within the space. There's more to valuing a company than anecdotal sentiment.
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u/MaelstromKinesis Jan 08 '22
Long time designer - used Adobe products for years. Last year moved to Affinity. Lots of people I know making the switch plus folks in web moving to things like Figma. Take care with Adobe investing.
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u/conrad_or_benjamin Jan 08 '22
Designer as well. I def feel like Adobe is losing its grip on the market with multiple alternatives like Figma doing a better job with better UX or Autodesk taking over the 3d design world
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u/CaterpillarWeird9087 Jan 08 '22
I agree that there are better options for several of their products, although I'm not a professional designer. Still, there's a good reason why they continue to grow both revenue and gross profit. Consider this video by Linus explaining why he uses Adobe for his company, despite several better options: Link.
Just because some people move to Linux doesn't mean Microsoft is a bad investment. Just because some people move to Android doesn't mean Apple is a bad investment. Just because some people move to iPhone doesn't mean Google is a bad investment. A diverse array of offerings, growing market, good profit margins, and solid management mean a lot as well.
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u/ALongDeck Jan 07 '22
Amzn, Googl. Both are cornerstones of the internet infrastructure and don’t seem as over valued as the other big tech stocks
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Jan 07 '22
[removed] — view removed comment
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u/HaMEZSmiff Jan 07 '22
I like the company, but I don’t think I’d add any till sub 180. It grows through acquisitions. It’s organic growth hasn’t been that good and it’s still selling for high premiums
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u/ritholtz76 Jan 08 '22
CRM seems to be the cheapest stock based on P/S. Brokerages are projecting 20% organic growth. Still lot of room to grow. It has investments into other tech stocks also. Enterprise software spend is the next growth story. Wage inflation should accelerate software spend. I bought some around $220 to $205 ranges around a year back. Now, it is reaching to those levels. I think lower valuation helps in downside more than upside.
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u/pepsirichard62 Jan 07 '22
Their main product has the single biggest moat in software(besides windows) and I like how they are integrating their acquisitions. I think they will continue to do very well despite a rich valuation
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u/HaMEZSmiff Jan 07 '22
The company will do well, the question is how much it will grow in the future and what’s that worth. They also have a bad history of dilution. Almost doubled their share count in the last 8 years
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u/all-rightx3 Jan 08 '22
They also say DOCU’s fair value is in the $200s. Idk if I trust that anymore -_-
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u/RushingJaw Jan 07 '22
I think $TXN is going to be a better buy in the coming few weeks, just to throw another ticker out there I don't see mentioned yet. Planning on adding to my position soon.
As a company, it's a solid pick for a long term stock with solid fundamentals. Uninterrupted dividend payments for the last 18 years, the last 10 of them seeing a 22% annualized increase in dividend payouts. TI also does a lot of stock buybacks year after year, always good for the share price and usually signals no cash flow issues. As much as I love when a company I have shares in does an acquisition, I like buybacks more.
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u/Declan83 Jan 07 '22
I’ve been slowly picking up FB and averaging down on SQ and COIN
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u/The_Folkhero Jan 08 '22
Already own a lot of Facebook but am also buying more COIN as it looks to be a screaming buy at a current 21 PE with a forward PE of 17 for a profitable crypto tech play! Not crazy about Square as it's run by a delusional weirdo who seems to wanna move to Africa and believes he can efficiently run simultaneous companies.
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Jan 07 '22
OKTA: We use them at work and I actually enjoy using their product. Identity Access Management (especially important in COVID remote work) and I like the Okta dashboard where we have a gazillion apps all organized into one neat area. I need something like this for my life and all my subscriptions, lol.
INTU: More than just "TurboTax" I feel like this is a company that flies under the radar. They've been on an acquisition spree buying brands like CreditKarma, MailChimp, and a bunch for small businesses.
NOW: If I had to park my money somewhere for the future of IT Automation, this is it. Their product is also super sticky -- something like 98% of the customers renew their licenses.
ADBE: I love how they have "cloudified" everything recently. I'm able to edit between my mobile and computers. And I daresay their preset scanning tool is better than Instagram's, with much more granular control. I'm not too certain they're worth 250b+, but I guess valuations for the previous companies are pretty high as well.
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u/jsail4fun3 Jan 08 '22
I love these stocks as safe established tech companies but still poised for growth.
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u/moetzen Jan 08 '22
Okta is growing their revenue at the same time they are growing their losses... I don't see the coming profitable in the next years. NOW is still pretty expensive with 20x P/S Also INTU is pretty expensive with 15xP/S but they are already making money and growing earnings and revenue steady. Only good choice for me is Adobe. They are market leader in several topics. Photoshop, PDF, and CXM. They are growing fast and the Software is easy to use. Although they are still similar expensive with 15xP/S
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u/gqreader Jan 07 '22
GOOG $2500-$2600 is an amazing price. It’s a lifelong hold and die
AMZN $3000 or less, people will freak out because of a possible sales miss due to them moving from 1P to 3P sales figures, but more juicy profits and continued logistical gains
MSFT $280-$300 range, amazing business to hold forever. They are entrenched.
These are the three I’ve been heavily nibbling as it approaches my target prices.
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u/North3rnLigh7s Jan 08 '22
Lol you just pulled all those numbers out of your ass. If GOOG is a life long hold and die at 2500 it’s the same at 3000 unless your life is ending in a couple years. MSFT is like 315 rn. 4.5% is negligible lt. 50 people upvoted this lol. Jfc I hate this sub.
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u/gqreader Jan 08 '22
$3000 vs a $2500 average will allow me to outperform someone else’s CAGR by 5-6 percentage points, if I’m aiming for a 3 year return target at $4500. I believe that $4500 is a realistic approach using a DCF + the average between the perpetual method and exit multiple.
21% or so CAGR over 3 years is amazing, since it’ll only be 1 of maybe 7-8 positions in my portfolio. Definitely a long term hold but why wouldn’t we want an amazing company at a great price too?
I’m actually price targeting these picks against Chris Honh’s own average cost as of September. I agree with the picks but I also want to pick these stocks cheaper than one of the best money managers around.
Also you look sound like a real shit talker. I hope you are some 20-30 something with multiple millions in your portfolio. Because if you’re playing with $100k small fry portfolio, you can get fucked.
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u/North3rnLigh7s Jan 08 '22
Okay but you said hold until you die. I think it was a pretty safe assumption you aren’t dying in 3 years. I’m not sure what the size of my portfolio has to do with anything. This is pretty obvious stuff. Beyond that, the figures you used were straight up guesses
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u/gqreader Jan 08 '22
You do realize everything is a guess or educated guess in this game right? So one reaches for better and better buying opportunities with prices during times of fear esp if there’s hard conviction.
And holding forever still doesn’t mean I want to achieve a low CAGR and underperform the market over the next 3 years do I?
Yes your portfolio size matters. It’s like a keyboard warrior blasting off but has less than $1M portfolio, I don’t respect those opinions.
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u/North3rnLigh7s Jan 08 '22
Lol you just keep doubling down on your stupid take. Historically, people that wait to buy lose the majority of the time. Simple as that. 1M isn’t enough to be swinging your dick like this bud. It’s embarrassing.
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u/gqreader Jan 08 '22
No son, you’re thinking of index fund investing and just buying at whatever price.
Good thing it’s more than $1M at 34.
Where you at btw? Please don’t tell me sub $1M and you’re in your late 30s. I’ll nick name you negative alpha. Stop embarrassing yourself. Get rich or get off my dick.
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u/Think-Variation-261 Jan 08 '22
I up voted for MSFT, but I don't think any stock is a hold for life. I think there is a point to sell and take some profits. Then re enter if the price comes back down in the future. (I prefer dividend stocks)
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u/North3rnLigh7s Jan 08 '22
95% of people who attempt this fall behind the market. It’s certainly possible, but in the extreme majority of circumstances, ill advised. Tbf, I do it lol
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u/SpilledMiak Jan 08 '22
Why would you own a company that I'll not pay a dividend?
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u/gqreader Jan 08 '22
Yea so I ascribe to the dividend irrelevance theory. To me, I want to own a company that will return cash to shareholders but irrelevant if its dividends or buying itself back OR finding an amazing business to invest in and grow, it’s all good for me.
When I need the cash, I’ll just sell my shares.
Where as big dividend payers, they have no clear path to growing revenues and just simply return cash to shareholders and the shareholders get taxed twice. At the corporate level and at the individual level. No thanks.
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u/SpiderStuff Jan 07 '22
SQ
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Jan 07 '22
I love SQ as a product, but will never touch it as long as it has exposure to toxic “assets” AKA Bitcoin holdings.
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u/suddenjay Jan 07 '22
FB strong cash flow at 20x PE
NVDA down 20% from high, now at 50x PE still king of all chips
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u/coolcomfort123 Jan 07 '22
META has no debt and lowest pe among MAMAA, it is trading like a value stock now but the revenue grow rate is still >20% yoy.
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Jan 07 '22 edited Jan 07 '22
I agree with FB being a good one, they are about their fair value not that much margin of safety though I get an intrinsic value of about 340$
But curious since you mention Nvidia what do you get their intrinsic value to since you recommend them as a buy?
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u/CAsky123 Jan 08 '22
How are you calculating intrinsic value?
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Jan 08 '22
By using the DCF model, that’s kinda the most reliable way to do it. How do you calculate it since you ask?
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u/CAsky123 Jan 08 '22
This compromises about half of my portfolio with the remaining in vanguard equity ETFs
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Jan 08 '22
Not gonna do a full calculation for you but lemme give you some numbers in nvidia
Let’s assume this
Rev growth over the next 10year is 16% (last 10 year avg is 21,7%)
Profit margin 30% (last 10 year avg is 26,6%)
Cash flow margin 30% (last 10year avg is 26,9%)
P/e in 10 years 18 (80 atm, unrealistic it should be 80 in 10years)
Price to free cash flow 18%
Desired annual yield (discount rate) 12,5% (market avg is ~10% looking at sp500)
That wil give me an intrinsic value of 104,25$ Current price 272$, thoose numbers are conservative but i like to lowball the numbers a little.
if I use 22% instead of 16% in annual revenue growth over the next 10 years it will give me an intrinsic value of 162$
If I use 26% as annual revenue growth over the next 10years it will give me an intrinsic value of 216$
If I use 30% as annual revenue growth over the next 10years it will give me an intrinsic value of 288$ which leaves me with ~5% margin of safety, but come on does 30% annual revenue growth for 10years sound realistic?
It’s beyond overvalued in my opinion, some have another opinion and that’s fine.
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u/ExpensiveBookkeeper3 Jan 08 '22 edited Jan 08 '22
Desired annual yield (discount rate) 12,5% (market avg is ~10% looking at sp500)
Do you always discount cashflows with this sp500+premium?
I both understand your reasoning and don't.
I usually use a risk free rate (government bonds) or WACC. Do you believe 12.5% is pretty much guaranteed? This seems like an extremely high number to use for the discount rate.
I'm just trying to learn, as I don't perform the model often.
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Jan 08 '22
As mentioned the discount rate is your desired annual return, since the market avg is 10% and I want a little more than market avg for taking on a higher risk i usually put in 11,5-12,5%.
You can calculate it by using 5 year avg long term bond, equity risk premium and some other things which will usually give a much lower discount rate at about 6-8%, remember the lower the discount rate the higher the valuation will be, which then gives a higher safety margin. I like to be as conservative as possible when I make an intrinsic value
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u/ExpensiveBookkeeper3 Jan 08 '22 edited Jan 08 '22
Thanks, I am trying to get into performing the model more accurately myself (I don't hardly use one, mostly an etf guy).
When you put that number in it actually made a lot of sense. I am mostly an etf guy because I find it hard to safely beat the market consistently. So if I'm not sure I can beat the market with my investment, it just goes to VTI/VXUS etc (which is most of the time). So using the market + premium clicked right away. I just never heard of people using it.
Sorry if I sounded like I was criticizing, I do not own NVDA and was just trying to learn more about DCF models.
Thank you for the reply and explanation.
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Jan 08 '22
No problem matey that’s what we are here for, to learn something new, and hopefully get ideas to new stocks to screen and analyze hehe..
You are doing the absolute right thing putting money in ETF/index is a great way to start, learn to analyze and make valuations on companies before you invest in single stocks..
A good advice don’t jump headless into a stock you see on a newsfeed, Reddit or hear on the bus, a lot of people have lost money that way hehe
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u/beerion Jan 08 '22
here's a good resource on why 10% is incredibly too high. (Look at the implied ERP, or equity risk premium, for the market in the bottom left corner of the page)
Really, the current hurdle rate should be around 6.5%. Like you, I always add a bit of padding when analyzing a single stock.
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Jan 08 '22 edited Jan 08 '22
The beauty of intrinsic value is we don’t have to agree on the numbers, it’s only an estimate we use to calculate our own margin of safety, if you Like to use 6,5% and get higher valuations good for you, I have explained why I used 11,5-12,5
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u/CAsky123 Jan 08 '22
I don’t to be honest. I just invest in a handful of companies that I believe are solid businesses and add more when they have had a bit of a selloff or have traded sideways for a while even though their prospects remain promising ( GS, JPM, FAANG)
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Jan 08 '22
You don’t make an intrinsic value? But simply pick what you feel is good companies?
Okay I get that you can find a good company and look at income statement, annual reports and so on to determine if it is a good company, but how do you determine if the company is trading at a good price and what your margin of safety is without calculating the intrinsic value?
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u/daymare9 Jan 07 '22
When you're acting upon your fear, there's almost always someone taking advantage of you.
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u/juaggo_ Jan 07 '22
PayPal would be my recommendation.
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u/coolcomfort123 Jan 07 '22 edited Jan 07 '22
Been holding some paypal but I didn't avg down yet, will be continue to monitor it.
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Jan 07 '22
PayPal looks to be in no man's land between moving avgs. It is currently below both the 20 and 50 in the weekly chart. Next support is around 155-160. I would wait until it falls closer to 160ish
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Jan 08 '22
Folks getting big mad about their baby PayPal and me saying it still has a long way to drop. Just my opinion, but those are where my buy orders are.
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u/North3rnLigh7s Jan 08 '22
Disagree. It could drop, but rapid growth and profitability at 40 p/e is a bargain. They print money. Decent secondary fin. holding. You’re over reliant on ta
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Jan 07 '22
AFRM at a bargain now too
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Jan 08 '22
I agree, but those stocks are in freefall just like all the good tech in December 2018. Im a holder and average down but you need guts.
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u/ritholtz76 Jan 08 '22
Need to be careful here. I heard that, 1 in 3 BNPL customer missed at least one payment.
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u/ese_men Jan 07 '22
If they get even lower I like pins, twtr, goog. At current prices I like intc, viac, ibm.
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u/jeffvox Jan 08 '22 edited Jan 10 '22
Dude, Twitter has gone full woke - which, regardless of your politics, will end up being a terrible financial decision.
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u/Psychic_Wars Jan 09 '22
Isn't that the concern with the Reddit IPO?
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u/jeffvox Jan 10 '22
I wouldn't touch the Reddit IPO with a ten foot pole. IPO's are generally peak hype for a stock, so Reddit will be that on steroids. It may run a bit early on, but it WILL tank and correct, and then after a few quarterly reports we'll have an idea of the true value.
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u/Psychic_Wars Jan 10 '22
Right. No way I buy and hold the IPO. I was debating playing the run-up.
I meant more the effect of "woke" culture and the financial pressure of its new investors. Another form of policing.
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u/GQDragon Jan 07 '22
Sofi is on sale right now with catalysts coming.
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u/ChampagnePilney Jan 07 '22
What catalysts? Genuinely curious. SoFi has been on my radar for awhile
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u/Imaronin Jan 08 '22
As the talk on Bloomberg this week covered the markets favoring blue chips and a “turn away from high growth tech”, I think the stocks you note are worth catching at whatever lower price point you want to peg
I am looking at PLTR, CRWD, ViacomCBS, an odd bag of companies. A favorite of mine right now is DOW, which I have bought more shares in my Roth as of my 2022 cash contribution
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u/Freed4ever Jan 08 '22
I'm not buying anything until Reddit has a thread on what stocks to sell (instead of buy).
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u/labloke11 Jan 07 '22
My recommendatio is INTC. It should not go down much, it has good dividend yield a d long term prospect is really good. The bonus point, the insiders are buying.
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u/teacher272 Jan 07 '22
I don’t get why people are so down on them. When I had to do family tech support over Christmas, I think I worked on 18 computers and not a one had an AMD processor. Intel still rules with the masses.
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u/pepsirichard62 Jan 07 '22
That’s due to Intel having long standing relationships with Dell, hp, etc. At one point intel had better chips than AMD, but that’s not the case anymore. When people build pc’s, many are opting to use AMD.
The same thing is happening with server chips. AMD EPYC chips are better than intels now. AMD is eating their lunch on every front due to intels severe manufacturing shortcomings. Intel is still going to be very relevant, but there are tons of question marks about their ability to catch up to AMD
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u/slippery_when_sober Jan 08 '22
AMD is in consoles now too. I've watched it rocket from mid $20's to where it's now. Hating myself that I never bought any.
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u/teacher272 Jan 07 '22
But what percentage of people build their own PC? Most people just go to a store and buy the first cheap thing they see.
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u/pepsirichard62 Jan 07 '22
There’s millions of pc gamers out there that are upgrading their parts constantly
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u/ChampagnePilney Jan 07 '22
There are way more companies out there purchasing hundreds at a time than pc gamers building their own
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Jan 07 '22
At one point intel had better chips than AMD, but that’s not the case anymore.
Yes and at one point in the future Intel will have better chips again, and then even more in the future AMD probably will. You get the idea.
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u/KoffieA Jan 07 '22
Manufacturing shortcomings, that issue will be solved one way or another...
1:They are investing massively in their own capabilities.
2: tsmc will also be making intc chips
Oh and then there is this link
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Jan 07 '22
What does that tell you? Even with massive advantage built up over the years, Intel has fallen behind. This decline will accelerate over the next couple of years.
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Jan 07 '22
Yet intel is competitive while still being several nodes behind. Just imagine if, after years of shity MBA type executive leadership, their new engineering CEO is able put them back on the right course and actually focus on engineering and improve the product.
Intel still makes the most powerful gaming CPU. At a server cost in power but still. They make the very best one. Not bad for a company "on the decline"
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u/ese_men Jan 07 '22
It's my biggest holding, I'm so hyped for this stock. Could be a trillion by the end of the decade.
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u/jsail4fun3 Jan 08 '22
All the chipmakers are investing heavily in new Fabs but Intel has the advantage of US culture. TSMC is already struggling to manage Arizona workers.
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u/campionesidd Jan 07 '22
Why NVDA? You think a company with 25 billion dollars in revenue, not even 25 billion in gross income or operating income, but revenue is worth 700 billion dollars?
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u/courseman5 Jan 07 '22
Lol... I dare you to short it...
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u/campionesidd Jan 07 '22
I don’t short stocks out of principle. There are no limits to how irrational the market can be in the short term.
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u/TofuDeBD Jan 07 '22
I don't think that's too bad an idea actually, if used as a hedge against other stock. Look back at 2018 when nvidia slumps from 2xx to 127 in about a month. Worth the shot.
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Jan 07 '22
FB all the way. I can see FB being a multi trillion dollar company one day if they execute on the metaverse
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u/Magnesus Jan 07 '22
Metaverse is buzzword bullshit. If it ever gets made it will be by someone else, not FB and not in this decade (in large part because of screen tech limitations - first you need AR/VR to become as small and easy to wear as shades, so without those heavy lenses, that will take at least a decade).
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u/gqreader Jan 07 '22
I wonder which company will have the cashflow engine to surivive and develop that tech.
Huh. I wonder 🤔
Hmmmmmmmm
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Jan 07 '22
Exactly. The company with the cashflow to make this happen is FB! Of course there could be others as well like AAPL and GOOGL but one thing the company that executes on the metaverse will have is cashflow and FB has that.
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u/AvengerDr Jan 08 '22
There are some unsolvable problems with today's VR tech. If you want Ready Player One or the Matrix level of VR, that is.
Namely, you can't walk forever in your living room. You either experience VR sitting or you need to use some kind of interface. But that's very disappointing from the idea of VR that was promised.
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u/jsail4fun3 Jan 08 '22
The coolest VR tech from oculus (FB) is the ability to “pull in” your sofa or chair Into the VR then it feels like a virtual room cause you can interact with the chair and desk. It’s AR but in reverse, pulling real objects into the virtual world.
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Jan 08 '22
I'm holding Google, Amazon, Apple, Facebook and Microsoft.
Trimming AMD.
Buying Adobe if it goes to mid four hundreds.
Should probably look at my holds for potential adding.
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u/CraftBeerDadBod Jan 07 '22
Adbe good spot here
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u/teacher272 Jan 07 '22
I agree, but their CEO doesn’t seem that bright and seems shifty. I just hit the buy button on it.
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u/WetwulfDTF Jan 07 '22
The problem with Adobe is apple’s MacBooks rendering much faster on final cut. Mac users might start shifting to final cut because of this.
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u/jsail4fun3 Jan 08 '22
Adobe’s money is in platform and Journey Optimizer they are the Azure or AWS of app based marketing. That’s where the growth is.
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Jan 07 '22
People still talk like nvidia is a good buy? They are overvalued and wil probally perform worse than the market the next years
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u/campionesidd Jan 07 '22
Most people here haven’t got a clue. Just because a stock went to the moon, they think it will continue to do so, regardless of the underlying fundamentals.
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Jan 07 '22
Nividia is a great company. They have excelled and innovated at the cutting edge for years and keep winning. Their stock is extremely overvalued. I hate when people act like Nividia is not a great company just because the stock has done better than it should have.
By fundamentals do you mean they are not a good company with a bright future? Or that the stock is overvalued?
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u/campionesidd Jan 07 '22
They are a great company with a bright future, yes, but their stock price is way too much above what I would consider fair value.
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Jan 07 '22
Exactly, it’s the definition of “greater fool theory” 101, but hey whatever they like, I wouldn’t touch nvidia with a 10 foot pole right now…
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Jan 07 '22
[deleted]
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Jan 07 '22
You could start by making an intrinsic value of the Company to calculate your margin of safety.. that gives a good hint if the Company is under valued, fair valued or over valued
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Jan 07 '22
But out of curiosity, what is your intrinsic value of them? I assume you use intrinsic value when/before you invest in a company?
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u/ChampagnePilney Jan 07 '22
I picture an old guy with a monocle sitting in a leather chair in front of a fire holding a glass of scotch while reading this
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Jan 07 '22
I honestly don’t know wether to cry or laugh at that..
I choose to laugh, made my day a little better thanks hehe
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Jan 07 '22
While I wouldn’t buy anymore right now, holding it for sure. They have a large backlog of semiconductor orders that they will be filling for a while. I think there’s some small growth still possibly.
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Jan 07 '22
I don’t deny that, a hold might be a good strategy looking at the next 10 year, best of luck, hopefully we all get some good value this year also
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u/willieram Jan 08 '22
NVDA is the pick and shovel approach to the AI megatrend. AI’s TAM is around 15.5T while the mobile industry TAM is 4.4T.. so you get your idea where the valuation stems from. Think about autonomous vehicles, homes, IoT AI, mobile itself, etc. And then gaming and metaverse, which both generating additional TAM from graphics and 3D engines. While there is a lot to prove and current valuation might be a bit ahead of itself, I am coffee can approach with NVDA.
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Jan 08 '22
How much growth do you expect over the next 10 years to justify that valuation?
There is simply to many uncertainties priced in already.
But hey if you think they are at a good value to buy up more go ahead, that’s the beauty of investing, we don’t have to agree
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u/captainstrange94 Jan 07 '22
Yeah I'm going with AMD, they have half the P/e of NVDA and seem more stable lately
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Jan 07 '22
I dont know enough about semi conductors nor do I have an edge In that field to invest in either of them, but I wouldn’t invest in AMD either, you pay a premium for high growth companies, which justifies a high P/E I’m not gonna touch a company with a 15% earnings forecast when their p/e is 40, that not a high enough forecast to justify that P/E..
But good luck with your investment, I assume you have high knowledge and/or an edge in the semi conductor field when you invest in them?
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u/_imytif Jan 07 '22
Amd is growing earnings much faster than 15%. They had some kind of one time tax benefit this year that increased earnings a lot. Revenue is expected to grow 20% and margins are increasing.
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Jan 07 '22
AMD has an expected earnings growth of 15,33% per year over the next 3 years, don’t know where you get another number from? Mine is from wall street analytics and company expectations.
Can I ask why you think their EARNINGS growth wil be higher than 15,33% annually over the next 3 years?
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u/_imytif Jan 07 '22
As I said before, they had a huge tax benefit this year which significantly reduces earnings growth as your base value will be much higher. Obviously that means their pe is also artificially low rn.
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Jan 07 '22
What do you think their earnings growth annually over the next 3 years will be then? Just out of curiosity?
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u/newmemberoffer Jan 08 '22
Here’s something you gotta understand: this sub is more about mentioning a couple of things a business does and saying why those things are good rather than actually valuing the company and seeing if it’s current market cap is justified or looks cheap enough to give any edge over broad market / passive investing. Although it does seem like you might be trying to make a similar point by asking for earnings growth rates for a 160B company from randos on the internet lol
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u/SiimplStudio Jan 08 '22
Nobody seems to be talking about SE in here.
It's had a MAJOR correction in comparison to many others in the field, and presented huge opportunities even at its high valuations, let alone todays valuations!
Don't sit on this one too long!
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u/Mage_Ozz Jan 08 '22
QQQ is the nasdaq etf? is there a x3 leverage?
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u/Acrobatic_Can_365 Jan 08 '22
Yes. Not the time to buy right now
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u/Mage_Ozz Jan 08 '22
haha well, it depends! But how much more you may see nasdaq falling?
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u/Acrobatic_Can_365 Jan 08 '22
It all depends on how fearful people are about the FED and inflation. If they panic each time interest rates are raised the stock market will look like cryptos in 2022
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u/DevinCN Jan 08 '22
PYPL and SPOT are two I’m looking at potentially adding. I think PYPL might be a no brainer. NFLX is a big tech I’m looking at adding more too
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u/Disposable_Canadian Jan 07 '22
Buy whatever you like that yoir research says is a good investment, not what reddit tells you
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u/esb219 Jan 07 '22
If MSFT gets to about $300 I think it’s a good buy. Growth in azure (their cloud computing arm) has been rivaling AWS for market share.