3 Cathie Wood Stocks Set to Explode Higher

Source: rhendrikdwenz via Shutterstock

Love her or loathe her, Cathie Wood’s magnetic pull on the investment world remains undiminished. Wood has uniquely curated portfolios brimming with disruptive tech firms and ambitious start-ups offering tremendous long-term upside potential. In its euphoric rally of 2020 to 2021, the investment maven’s flagship exchange-traded fund soared to new heights, delivering staggering triple-digit returns.

However, during the stock market rout last year, the fund plummeted more than 70% from its highs. Detractors quickly labeled her approach reckless, associating her with fleeting wealth built on shaky grounds. Moreover, her core philosophy of channeling resources into cutting-edge technology firms and growth stocks has paid dividends this year. In a risk-off market environment, her approach will likely create many millionaires.

Kratos Defense (KTOS)

Kratos Defense (NASDAQ:KTOS) shines brightly as a major contender of innovation and strategy in the vast expanse of the aerospace and defense sphere. Even with the ever-evolving global political backdrop, Kratos’ technological prowess continues to capture attention, cementing its position as one of the standout picks in Cathie Wood’s portfolio. A notable 0.8% of her holdings are allocated to this gem, and her bullish sentiment echoed further with a 2.3% share hike in the recent quarter.

Diving deeper into Kratos’ arsenal, its XQ-58A Valkyrie is positioned to revolutionize aerial combat on a path to full-fledged deployment. Complementing its tech advancements, the company recently unveiled its second quarter Non-GAAP EPS that breezed effectively past estimates. With an impressive $256.9 million in revenue, showcasing a 14.6% YOY growth, and a robust projection ranging between $980 million to $1 billion for the year, Kratos is confidently navigating the future. An appreciable 40% stock uptick YTD reaffirms its formidable stature in the defense realm.

Twilio (TWLO)

Amidst the vast landscape of cloud-based solutions, Twilio (NYSE:TWLO) has effectively carved its niche in the sector for its impeccable mobile app integration capabilities. It has been an excellent performer over the years and recently posted Q2 results, where sales grew by an enviable 10% YOY, clocking in a massive $1.04 billion, outpacing analyst forecasts by $53 million. Moreover, the transition from an 11-cent loss to impressive adjusted earnings of 54 cents per share showcases Twilio’s resilience and thriving ability.

Furthermore, it accounts for a substantial 2.3% slice of Cathie Wood’s portfolio dedicated to Twilio, increasing her stake by 12.6% in Q2. Jeff Lawson, Twilio’s Co-Founder and CEO, remains bullish over its trajectory ahead, pledging relentless growth endeavors on all fronts. It strategically moved to repurchase $485 million of its stock in the first half of the year, solidifying Twilio’s rank as a must-have in the communications stock repertoire.

CRISPR Therapeutics (CRSP)

In the rapidly evolving realm of gene editing, CRISPR Therapeutics (NASDAQ:CRSP) emerges as a groundbreaking force, harnessing the might of its popular CRISPR/Cas9 technology. Its leading candidate, exagamglogene autotemcel (exa-cel), has been met with plenty of optimism, especially for patients besieged with sickle cell disease and beta-thalassemia.

Diving deeper, the company’s robust pipeline, encompassing areas such as oncology and diabetes, paints a promising picture of the future of genetic medicine. Moreover, its Q2 announcement further amplifies this sentiment, revealing sales that skyrocketed to $70 million from a modest $158,000 last year. This dramatic surge, attributed to their synergistic collaboration with Vertex Pharmaceuticals on exa-cel, paints an upward trajectory.

Furthermore, its judicious R&D expenditure management, marked by a 17% YOY drop to $101.6 million, trimmed its net loss per share by a whopping 59% YOY, settling at 98 cents. Echoing the firm’s potential, Cathie Wood has dedicated 2.5% of her portfolio to CRISPR, signifying a vote of confidence in its pioneering path.

On the date of publication, Muslim Farooque did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

Muslim Farooque is a keen investor and an optimist at heart. A life-long gamer and tech enthusiast, he has a particular affinity for analyzing technology stocks. Muslim holds a bachelor’s of science degree in applied accounting from Oxford Brookes University.

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Ticking Time Bombs: 3 Cannabis Stocks to Dump Before the Damage Is Done

Source: Jan Havlicek/shutterstock.com

The North American cannabis market is booming in 2023, thanks to the legalization of recreational and medical marijuana in several states and provinces. Many investors are betting on the growth potential of this industry, especially as cannabis may be moved to Schedule III from Schedule I of the Controlled Substances Act (CSA). This would ease the regulatory burden and increase access to banking and research for cannabis businesses.

Of course, not all cannabis stocks are created equal, and some of these cannabis market players have company-specific risks that could curtail their growth prospects. Below are three cannabis stocks investors should consider dumping this month.

SNDL (SNDL)

SNDL (NASDAQ:SNDL) is one of the largest alcohol and cannabis retailers in Canada with 196 locations as of August 2023.  The company’s cannabis business, in particular, specializes in both cultivating and selling premium flower products. SNDL claims to have a differentiated approach to production, quality control, and customer experience. Furthermore, SNDL prides itself on its bespoke manufacturing capabilities which are able to adopt to a number of different product offering.

Though SNDL is surely one of the largest cannabis retailers in Canada by revenue, the cannabis retailer has not been able to generate substantial profits through its vertically integrated cultivation and production process. In their second quarter earnings print, gross margins came in around 21.2%, and SNDL only generated positive EBITDA on an adjusted basis, which also speaks to its genuine struggle to keep margins stable.

Although secular tailwinds exist for the cannabis market, SNDL is perhaps not the best investment for public equities investors looking to keep capital in an asset that will provide substantial yield. SNDL shares trading at $1.97 a share, well below its all-time high of $130.00 in 2019. Investors have already loss so much in that amount of time and are better off investing in other assets.

Tilray Brands (TLRY)

Tilray Brands (NASDAQ:TLRY) is another large, Canada-based cannabis producer and distributor based with operations in Europe, Latin America and Australia. Similar to its competitor SNDL, Tilray has been struggling with expanding both revenue growth and profitability margins in recent years. As I wrote in a prior piece, Tilray’s fiscal year 2023 report showed an annual decline in revenue primarily due to higher competition in Canada, Tilray’s largest cannabis end-market.

It appears Tilray and the cannabis producer’s competition are all dealing, in one way or another, with a high-cost structure. While many investors choose to prioritize revenue multiples when examining cannabis stocks, it’s important to also examine trends in these companies’ profitability-related multiples in order to gauge how they can effectively return capital to shareholders over the long run.

Until Tilray has overcome its burdensome cost-structure, it will remain difficult to recommend the cannabis producer’s shares.

MedMen Enterprises (MMNFF)

MedMen (OTCMKTS:MMNFF) is a leading cannabis retailer in the U.S. with a strong presence in California, Nevada, Illinois, Arizona, and Massachusetts. From its inception in 2010, the company was able to build a robust reputation for offering high-quality products and services to its customers, as well as a sleek and modern store design. However, a series of scandals and controversies, including those involving its former CEO, board members, and suppliers, have since then tarnished the company’s reputation.

Moreover, MedMen has had a history of burning through cash which has at certain moments forced the company to sell some of its assets and raise capital at unfavorable terms. The trend of burning through cash and putting assets up for sell has not abated. The cannabis producer’s “cash and cash equivalents” balance is again on the decline as of its latest Form 10Q, while it also had $41.1 million of assets up for sell during the same period.

MedMen’s shares are trading well below $1.0, which has given investing in the asset another dimension of risk. Investors desiring to make a cannabis play should definitely look elsewhere rather than playing the lottery on MedMen’s shares.

On the date of publication, Tyrik Torres did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

Tyrik Torres has been studying and participating in financial markets since he was in college, and he has particular passion for helping people understand complex systems. His areas of expertise are semiconductor and enterprise software equities. He has work experience in both investing (public and private markets) and investment banking.

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Bill Ackman would ‘absolutely’ do a deal with X with his new SPARC

Bill Ackman, Pershing Square Capital Management CEO, speaking at the Delivering Alpha conference in NYC on Sept. 28th, 2023.

Adam Jeffery | CNBC

Billionaire investor Bill Ackman would “absolutely” do a deal with X, the social platform previously known as Twitter, with his newly approved investment vehicle, Ackman told The Wall Street Journal in a story published on Sunday.

On Friday, Ackman announced that the Securities and Exchange Commission approved his new financing vehicle, which he is calling a SPARC — a special purpose acquisition rights company. In a SPARC, investors will know what company the financing vehicle would be used to merge with before they have to pledge their investments.

“If your large private growth company wants to go public without the risks and expenses of a typical IPO, with Pershing Square as your anchor shareholder, please call me,” Ackman said in a post on X, formerly known as Twitter. “We promise a quick yes or no.”

Ackman told the Journal that he would “absolutely” consider using his newly formed SPARC to invest in X, the social media platform previously known as Twitter.

A spokesperson from Pershing Square Capital Management, Ackman’s investment firm, told CNBC the company had nothing further to add other than what was in the Journal story.

Investors interested in the SPARC were directed to follow Bill Ackman’s account on X for more information, according to the press release announcing the regulatory approval of the investment vehicle.

Ackman posts regularly on a wide variety of topics on X, including his support for U.S. presidential candidates Vivek Ramaswamy and Robert Francis Kennedy Jr., his assertion that he married the “female version of Elon Musk.”

While Ackman uses X regularly and told the Journal he would embrace using his newly formed investment vehicle to merge with X, the implications of being a public company make it unlikely that X would actually pursue the deal, according to Alan D. Jagolinzer, a professor of financial accounting at the University of Cambridge Judge Business School.

“Taking X public would expose X to financial and governance regulatory transparency and accountability; which is why I’m skeptical it’ll happen,” Jagolinzer said in a post on X.

Read the full story on The Wall Street Journal website here.

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3 Semiconductor Stocks Set to Explode Higher

The semiconductor industry is poised for massive growth, but names like Nvidia (NASDAQ:NVDA) and AMD (NASDAQ:AMD) have already seen their share prices surge. For investors looking to capitalize on the semiconductor boom, the key is finding the hidden gems. These are the under-the-radar players whose innovative technologies position them for multi-bagger returns.

The growth drivers for this sector are clear. Cutting-edge technologies like artificial intelligence, 5G, cloud computing, and the Internet of Things are all chip-intensive. As these transformative innovations go mainstream, demand for advanced semiconductors will skyrocket. At the same time, a global chip shortage has highlighted the need for more domestic production capacity. Government initiatives like the CHIPS Act will also unlock billions in funding to build new foundries and expand manufacturing.

With that in mind, the long-term outlook for chip makers is very bullish, but the semiconductor space remains turbulent in the near-term. Savvy investors should embrace these dips as opportunities to grab shares of great companies at a discount. Here are the three stocks I’m talking about.

IPG Photonics (IPGP)

Laser maker IPG Photonics (NASDAQ:IPGP) has seen its stock tumble over 60% from its February 2021 peak to around $100 per share currently. The company has faced declining sales this year amid inventory adjustments and project delays impacting its industrial customer base. However, the negativity seems overdone, and IPGP stock now looks attractively-valued for long-term investors.

That’s because after revenue declined an estimated 6.4% this year, analysts expect IPG Photonics to deliver double-digit revenue growth over the next two years as secular tailwinds in materials processing applications kick in. The consensus estimates call for 10.5% revenue growth in 2024 to $1.5 billion and 13.4% growth in 2025 to $1.7 billion. Meanwhile, earnings are projected to rebound strongly, increasing 35% over that timeframe.

I believe this growth should drive a higher valuation. IPGP trades at just 21-times forward earnings, near multi-year lows. The consensus analyst price target of $130.50 implies almost 30% upside potential over the next 12 months. With improving sales and profit momentum, IPGP appears well-positioned to regain lost ground.

Siltronic AG (SSLLF)

German wafer manufacturer Siltronic (OTCMKTS:SSLLF) has also been through the wringer, with its stock tumbling from around $175 in early 2021 to a low of $54 in October 2022. However, the tide seems to be turning. SSLLF stock has crept up over the past few months to above $80 currently. I believe the recovery rally has legs to $130, which Gurufocus estimates as the stock’s fair value. Gurufocus also estimates this fair value number to hit nearly $200 by the end of 2026.

Meanwhile, Siltronic has benefited from the inventory correction running its course, and expects demand to improve starting in 2024. Of course, revenue is on a downtrend right now, and analysts believe year-end sales decline will hit 16.62%. However, they also believe revenue will rebound and deliver double-digit growth for at least the next three years. In addition, the company invests heavily in capacity expansions that should drive strong growth in outer years. Consensus estimates see revenues almost doubling from $1.6 billion in 2023 to $3 billion by the end of 2031.

Despite these growth prospects, SSLLF stock trades at just 7-times forward earnings, a bargain valuation. The stock also pays a dividend yielding nearly 4%. Patient investors buying at current levels can generate substantial returns as the industry continues to grow.

Taiwan Semiconductor (TSM)

Taiwan Semiconductor (NYSE:TSM) is the undisputed leader in advanced chip manufacturing. However, investors have shunned the stock recently due to risks surrounding the China-Taiwan relationship and substantial investments in U.S. manufacturing capacity. I believe these issues are overblown.

The reality is almost every major chip developer, including prominent U.S. names like Nvidia, Qualcomm (NASDAQ:QCOM), and AMD, rely heavily on TSM for their manufacturing needs. Despite that, they don’t receive the same valuation haircuts despite similar China exposure. Thus, the negativity around TSM appears excessive.

Meanwhile, the company is making huge investments in the U.S. that should eventually provide geographical diversification and profit tailwinds. TSM is investing $40 billion in chip fabrication in the U.S. Indeed, more U.S. manufacturing should alleviate national security concerns and ease tensions with China.

I expect Taiwan Semi to deliver at least double-digit annual growth per year on average this decade, driven by the secular chip demand trends. The stock trades at just 17.4-times forward earnings, which I see as an attractive entry point, especially when compared to its peers. Once macro concerns abate, TSM stock should regain its premium valuation and deliver solid returns for shareholders. To top it all off, you’re also getting a 2% dividend yield as a sweetener.

On the date of publication, Omor Ibne Ehsan did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

Omor Ibne Ehsan is a writer at InvestorPlace. He is a self-taught investor with a focus on growth and cyclical stocks that have strong fundamentals, value, and long-term potential. He also has an interest in high-risk, high-reward investments such as cryptocurrencies and penny stocks. You can follow him on LinkedIn.

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Ticking Time Bombs: 3 Gaming Stocks to Dump Before the Damage Is Done

The gaming industry can seem like a gold mine, with over 3 billion gamers globally spending billions of dollars on interactive entertainment. However, while smash hits like Minecraft and Grand Theft Auto V can print money indefinitely, most games quickly fade into obscurity. This presents a major problem for gaming companies relying on just one or two titles to support their entire business. When the hits dry up or new releases flop, these firms can suffer catastrophic declines.

In this article, I highlight three gaming stocks that face precisely that risk of collapse, as their current games lose steam. While generational franchises like Call of Duty and Mario Kart evolve across endless sequels, one-trick studios without deep IP portfolios often struggle to replicate past success. And with mobile gaming lowering consumer pricing expectations, premium $60 console titles don’t cut it anymore, without delivering a knockout experience.

Investors backing such studios without rigorous analysis risk getting caught up in the aftermath. So before the damage accelerates, let’s explore three gaming stocks on the brink and why you should dump them immediately.

FaZe Holdings (FAZE)

FaZe Holdings (NASDAQ:FAZE) operates as a gaming and lifestyle brand focused on influencer content, esports teams, and merchandising. However, its business model has been on a downward spiral and its future growth potential seems bleak.

Unlike traditional gaming companies, FaZe does not develop video games. It generates revenue primarily through brand sponsorships, consumer products, and entertainment. This leaves FaZe heavily reliant on the popularity of its roster of influencers and esports teams to drive its success. In its latest earnings report, FaZe announced a Q2 net loss of $14.4 million on revenue of just $11.7 million. Simply put, it is a dying clan and many of their team members are fading into obscurity. I believe this company fits the definition of a ticking time bomb as it does not have any way long-term backup plan if FaZe members continue to lose popularity or simply lose interest.

FaZe also faces risks tied to constantly evolving gaming and influencer trends. It is struggling to attract sponsorships and merchandise sales, and expanding into areas like Web 3.0 and NFTs hasn’t worked.

IGG Inc (IGGGF)

IGG Inc (OTCMKTS:IGGGF) is a Singapore-based mobile game developer that has faced challenging market conditions in China. The Chinese government has implemented strict regulations limiting play time for video games, which are basically unheard of anywhere in the world. However, it has been very effective, and gaming companies are complying religiously. To give you an idea, children under the age of 18 can only play video games for one hour per day, and gaming companies are required to verify children’s identity. If these time limits are passed, users can also receive in-game penalties.

In its latest earnings report, IGG announced a net loss of $359.8 million for the first half of 2023. This was despite a 30% year-over-year decline in R&D expenses and a 19% drop in administration costs. The company’s flagship title, Lords Mobile, accounted for most of its total revenue. While Lords Mobile has provided stable revenue, it is a 7-year-old game that likely has limited longevity. IGG’s investments in new games like Doomsday: Last Survivors and Viking Rise have not yet offset the declines in its older titles.

Plus, China’s tight regulatory environment presents an enduring headwind for IGG. The company will need to continue diversifying its portfolio and expanding in international markets to reduce its reliance on China. IGG’s push into areas like mobile apps could provide future growth if executed successfully. However, China’s gaming restrictions will remain a challenge. IGG has a strong legacy game in Lords Mobile but needs new breakout hits to reignite revenue growth. I don’t see that happening soon.

Enthusiast Gaming (EGLX)

Enthusiast Gaming (NASDAQ:EGLX) operates one of the largest gaming information networks in the world. However, its business is soaked in red ink and faces considerable risk. The company owns over 100 gaming websites, including Destructoid and Daily Esports, generating revenue primarily through programmatic advertising across its network. It also has operations in content production, esports events, and subscription services.

However, In Q2 2022, Enthusiast posted a net loss of $10.2 million on revenue of $31.6 million. The company’s gross margin did improve to 35%, as the company reduced its reliance on low-margin programmatic ad revenue. However, Enthusiast still faces financial pressures, with $24.6 million in operating expenses last quarter.

Enthusiast Gaming plans to continue pivoting toward higher-margin revenue streams and focus on cost-reduction efforts to reach profitability. However, the ad market faces macro headwinds and competitors like Amazon (NASDAQ:AMZN) are entering the gaming content space. Sure, Enthusiast can cut costs further, but I don’t think it will make the stock any more compelling. Revenue growth is the most critical metric for a growth-centric company like Enthusiast, especially when it is small. With revenue declining at a 20% annual clip, as of Q2, there are too many red flags here, in my opinion. The company’s president also resigned a few weeks ago, signaling internal turmoil could be building.

On the date of publication, Omor Ibne Ehsan did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

Omor Ibne Ehsan is a writer at InvestorPlace. He is a self-taught investor with a focus on growth and cyclical stocks that have strong fundamentals, value, and long-term potential. He also has an interest in high-risk, high-reward investments such as cryptocurrencies and penny stocks. You can follow him on LinkedIn.

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Biden calls on Republicans to ‘keep their word about support for Ukraine’

President Joe Biden, speaking at the White House on Sunday some 12 hours after signing stopgap legislation to avert a federal government shutdown, called on House Speaker Kevin McCarthy and fellow Republicans to maintain the U.S.’s commitment to assist Ukraine in its ongoing defense against the Russian invasion that began in February 2022. McCarthy, the president said, has committed to bring a Ukraine assistance bill to the House floor, after McCarthy, who has to varying degrees publicly expressed support for the Ukraine cause, removed Ukraine funds from the 45-day continuing resolution passed Saturday, with Democratic backing, to assuage his own intraparty detractors. “Let’s be clear,” said Biden. “I hope my friends on the other side [of the aisle] keep their word about support for Ukraine. They said they’re going to support Ukraine in a separate vote.” Biden called the government-shutdown near-miss “a manufactured crisis” brought about when Republicans walked away from the compromises reached in May, when McCarthy and Biden came together to resolve a debt-ceiling impasse. “I’m sick and tired of the brinksmanship.”

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Top Wall Street analysts pick these five stocks for compelling returns

Shantanu Narayen, CEO, Adobe.

Mark Neuling | CNBC

Investors are grappling with uncertainty after a difficult September left the major averages reeling.

However, the current scenario also offers an opportunity to pick stocks that could generate attractive returns despite short-term pressures.

To that end, here are five stocks favored by Wall Street’s top analysts, according to TipRanks, a platform that ranks analysts based on their past performance.

Adobe

Software giant Adobe (ADBE) recently reported fiscal third-quarter earnings. The company is experiencing strength in subscriptions to its cloud-based software offerings.

Impressed with the quarter’s print, Deutsche Bank analyst Brad Zelnick boosted his price target for ADBE stock to $610 from $550 and reaffirmed a buy rating. The analyst said the results reinforce his view of Adobe as a winner in an emerging generative artificial intelligence world.  

Ahead of the results, Adobe announced the commercial availability of its Firefly generative AI offering and increased the pricing of its Creative Cloud product to reflect the integration of the new AI features. The analyst said that this pricing strategy could drive the adoption of the core Creative Cloud product with the embedded generative AI tools, which is better than selling the new features separately.

“This strategy should enable creatives to better appreciate the productivity benefits of generative AI more quickly, and make Firefly-powered generative AI offerings a critical part of their workflows, creating competitive differentiation as well as increasing the overall value of Creative Cloud,” said Zelnick.

The analyst also sees additional monetization opportunities through new standalone offerings like GenStudio. 

Zelnick ranks No.50 among more than 8,500 analysts tracked by TipRanks. His ratings have been profitable 71% of the time, with each delivering a return of 15.5%, on average. (See Adobe’s Technical Analysis on TipRanks)   

Salesforce

Zelnick is also bullish on another cloud software vendor: Salesforce (CRM). The analyst reiterated a buy rating on the stock with a price target of $260 following the company’s Dreamforce annual conference and investor meetings with the CEO of a Salesforce consulting partner and a global consulting firm executive.

He said that the Dreamforce event emphasized Salesforce’s leadership in AI customer relationship management (CRM), supported by a combination of “trust, data and interoperability.” (See Salesforce Hedge Fund Trading Activity on TipRanks).

The analyst noted that data cloud commentary from partners was optimistic, based on real demand and ongoing implementations.             

“With strong pricing power, unparalleled access to enormous trusted data, an eventual rotation back to front office spending, as well as management’s laser-focus on margins and cash flow growth, we believe Salesforce shares are poised to outperform,” said Zelnick.

Pinterest

Image-sharing platform Pinterest (PINS) held its investor day on Sept.19. At the event, the company said that it expects a compound annual growth rate in the mid to high teens for its revenue and an earnings before interest, taxes, depreciation and amortization margin that is in the low 30% range over the next three to five years.

Baird analyst Colin Sebastian noted that management expects an upside to its long-term targets if the underlying trends improve. The analyst highlighted that the shopping experience remains vital in the company’s overall strategy. Specifically, 96% of searches on Pinterest are unbranded, providing advertisers a huge opportunity to target users, with more than 50% of them using the platform to shop.

“Importantly, the Amazon ads integration seems to be going well, exceeding management’s initial expectations, with Pinterest using its recommendation engine to target Amazon ads at its own users,” added Sebastian.

The analyst reaffirmed a buy rating on PINS stock and a price target of $34, with a valuation that reflects rapid growth rate, an early stage of market share gains, as well as significant cash flow generation over the long term.

Sebastian ranks 328th out of more than 8,500 analysts tracked on TipRanks. Also, 54% of his ratings have been profitable, with an average return of 11.7%. (See Pinterest Blogger Opinions & Sentiment on TipRanks) 

Microsoft

Tech giant Microsoft (MSFT) recently made several announcements spanning its Microsoft 365 Copilot, Bing, Windows and Surface products.

Goldman Sachs analyst Kash Rangan thinks that the developments announced by the company reflect solid execution against its Copilot product roadmap and the strength of its OpenAI partnership.

“Microsoft’s speed to market, strong presence across the tech stack and well-established footprint within the enterprise give us confidence that Microsoft is well positioned to drive growth on the back of these announcements and be a key leader in the Gen-AI era,” said Rangan.

The analyst thinks that the company should be able to capture a solid part of its more-than-$135 billion total addressable market within Microsoft 365, with additional opportunities across its Azure, Windows, Dynamics and Bing/Edge offerings. He reiterated a buy rating on MSFT with a price target of $400.

Rangan holds the 509th position among more than 8,500 analysts on TipRanks. His ratings have been profitable 58% of the time, with each delivering an average return of 8.5%. (See Microsoft Financial Statements on TipRanks)

FedEx

We end this week’s list with logistics giant FedEx (FDX). The company recently reported fiscal first-quarter earnings that beat expectations, but a decline in revenue due to macro pressures. The bottom line benefited from the company’s cost-reduction initiatives.

Evercore analyst Jonathan Chappell, who holds the 156th position out of more than 8,500 analysts on TipRanks, noted the improvement in the company’s full-year earnings guidance range, despite the lower revenue outlook. The earnings outlook was fueled by the cost reductions under FedEx’s DRIVE program that is targeting savings of $1.8 billion in fiscal 2024.

Chappell said that FedEx grabbed about 400,000 packages of volume from its closest peer (UPS), with a lower possibility of these share gains reversing immediately. Further, FedEx gained almost 5,000 shipments per day from the liquidation of a key competitor (Yellow).

The analyst said, “FDX continues to build a track record of execution on its ambitious cost-cutting and efficiency targets, rendering the equity as a unique investment opportunity for when demand returns.”

Chappell maintained a buy rating on FDX and raised his price target to $291 from $276, saying that FDX remains his top pick. His ratings have been successful 65% of the time, with each rating delivering an average return of 19.7%. (See FedEx Insider Trading Activity on TipRanks).  

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AI’s Meteoric Rise Is a Trillion-Dollar Opportunity in the Making

Editor’s note: “AI’s Meteoric Rise Is a Trillion-Dollar Opportunity in the Making” was previously published in August 2023. It has since been updated to include the most relevant information available.

The world has been buzzing about artificial intelligence (AI) since OpenAI first introduced ChatGPT back in November 2022.

And initially, investors were skeptical of the hype surrounding this new tech. But ChatGPT’s debut made clear that the AI Revolution has not only arrived; it is rocketing forward at lightning speed.

Just consider the AI-driven chatbot’s unprecedented rate of adoption.

Within five days of its release, ChatGPT amassed 1 million active users. In 40 days, it attracted 40 million users. And in just two months, it surpassed 100 million active users. 

By comparison, it took TikTok – the most viral social media app of all time –  nine months (or 4.5X as long) to reach 100 million users.

Source: UBS/Yahoo Finance

ChatGPT is the fastest-growing consumer technology application of all time. 

But its meteoric rise is about so much more than just a buzzy conversational chatbot. We believe it marks the tipping point for the AI Revolution, just as the iPhone’s introduction did for the digital economy’s explosive growth.

And if you invest in the best artificial intelligence stocks right now, you’ll be prepared to reap the epic rewards that follow AI’s “iPhone Moment.”

AI Just Had Its “iPhone Moment”

ChatGPT launched in late November. Since then:

  • Microsoft (MSFT) – OpenAI’s biggest investor – has integrated ChatGPT’s technology into its Bing Search Engine, as well as its entire suite of productivity software, including Word, Excel, and PowerPoint.
  • Alphabet (GOOGL) has launched its own ChatGPT competitor, an AI chatbot called Bard.
  • Meta (META) has started work on its own AI chatbot and is looking to use AI to improve its advertising business.
  • Amazon (AMZN) launched a $100 million fund for investing in AI startups.
  • Salesforce (CRM) launched its own AI engine, dubbed Einstein, and created a $500 million fund for AI startups.

And just last month, on August 23, leading AI chipmaker Nvidia (NVDA) reported grand-slam earnings results, powered by seemingly unstoppable demand for its AI chips. Revenues topped expectations by more than 20%. Earnings topped expectations by more than 30%. And management said that in the upcoming quarter, revenues will be about $16 billion – more than the company made during the entirety of 2020.

Following the release of those blockbuster earnings, Wedbush Securities analyst Dan Ives wrote: 

“…Investors now recognize crystal clear [that] this AI demand story is as REAL as any tech trend we have seen in the last 30 years, only comparable to the internet in 1995 and Apple’s iPhone launch in 2007.”

The AI Revolution is sprinting forward full-steam ahead.

It seems ChatGPT started a movement.

And it did so because of accessibility. 

A Staggering Technological Shift Is Underway

When it comes to major technological paradigm shifts, the world doesn’t truly recognize their value – and they don’t truly go mainstream and change the world – until they become accessible to the masses. 

The World Wide Web was invented in 1989 and went public in 1993. Most Americans were online by 2005. But we weren’t really using the internet and taking full advantage of all it had to offer until 2007 – when Apple launched the iPhone. 

That device put the power of the internet in everyone’s hands for $600. It made the internet accessible. It unlocked a whole new degree of freedom and flexibility to experiment with the internet, learn about it, understand its value, and leverage it in beneficial ways. 

Over the next decade, thousands of apps were created and launched across billions of phones, creating an entire Digital Economy that is now worth trillions of dollars.

It all started with the iPhone – the internet’s first truly accessible technology. 

In the 15 years between the dawn of the internet and the iPhone’s launch, tech titans Amazon, Alphabet, and Microsoft aggregated a total combined market value of about $500 billion.

A graph showing the market caps of AMZN, GOOGL, and MSFT between the 1980s and 2008

Today, those three internet giants have a combined market value of about $5.3 trillion. 

That means, in the 15 years since the iPhone launch, they’ve created $5 trillion worth of economic value. That’s 10X the total value they created before the iPhone’s release.

A graph showing the change in AMZN, GOOGL, and MSFT stocks' market caps over time

By being the internet’s first truly accessible technology, the iPhone injected steroids into the already powerful Internet Revolution. 

And right now, with the meteoric rise of artificial intelligence, history is repeating itself before our very eyes. 

The Final Word on Profiting in the Age of AI

Before ChatGPT, sophisticated AI was a merely a science fiction concept that VC investors were throwing money at and engineers were busy working toward in Silicon Valley labs. It wasn’t accessible to Main Street.

Sure, we had Siri on our iPhones, maybe Alexa and Google Assistant in our homes. But let’s face it; those were pretty “dumb AI” not impressive, blow-you-away AI. And they didn’t start an AI frenzy on Main Street and Wall Street.

They weren’t ChatGPT.

We are presently witnessing the iPhone moment for AI.

And that’s pretty exciting because while the internet revolution was big, the AI Revolution will be much, much bigger.

As I like to say, the internet revolution made millionaires out of investors and billionaires out of entrepreneurs. The AI Revolution will likely make billionaires out of investors and trillionaires out of entrepreneurs.

It will take the magnitude of wealth-creation potential up to a whole new level.

It’s the opportunity of a lifetime.

And what better way to invest in the AI Revolution than by investing in the firm that started it all?

Since OpenAI launched ChatGPT in late 2022, the firm’s valuation has doubled. And it has scored huge partnerships with Intuit, Moody’s, and more.

But because the startup isn’t publicly traded, most retail investors missed out on OpenAI’s explosive rise over the past few months.

Miss out no more.

I discovered a loophole that allows you to invest in OpenAI right now.

Like investing in Apple (AAPL) in the 1980s or Amazon in the 1990s, this is an opportunity you can’t afford to miss.

Take advantage of this loophole today.

On the date of publication, Luke Lango did not have (either directly or indirectly) any positions in the securities mentioned in this article.

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