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☕ AMD: how to avoid the mistake many investors won't see coming until it’s too late

Apr 29, 2024

Good morning! 👋

We’ve got some green on the screen in the early going, and that’s logical ahead of some big earnings this week including AMD, Apple, and Amazon.

Here’s my playbook.

1 – AMD: how to avoid the mistake many investors don’t see coming

Expectations are undeniably high but, as I noted to the fabulous Ashley Webster ahead of this morning’s opening bell, watching AMD is critical. (Watch)

The loony tunes squad is going to be out in force telling you how “expensive” the stock is and to wait for a pullback... yada, yada, yada. If you’re tempted to listen – and I get that you might be - ask yourself how you’re gonna feel if that never happens and you never get your shot at the brass ring.

Change your tactics, dang it - this isn’t rocket science!

There are all kinds of simple ways to get on board yet keep risks to razor-thin levels if you know what you’re doing.

If you’ve got this covered, excellent. And if you don’t and would like some help in the company of super-savvy, like-minded investors from all walks of life, you know where to find me.

AMD has returned 85.80% over the past year and 472.50% over the past 5. The S&P, by comparison, has returned 24.48% and 88.51% respectively over the same time periods according to Koyfin.

Keith’s Investing Tip: Many investors get caught on the sidelines over and over again because they worry about being “right.” The world’s most successful investors focus on being profitable.

2 – Why Musk’s self-driving Chinese expaganza matters even if you hate the thought

Musk landed in China on what is being billed as a surprise visit where he all but received a hero’s welcome and Tesla is in the running for full FSD approval. (Read)

My colleague and friend Dan Ives of Wedbush Securities called it a watershed moment (Watch)

I agree.

To a point I have made many, many times.

Tesla isn’t about the cars and hasn’t been for years. Anybody still thinking in those terms may as well consider Apple a PC company.

This move further opens the door and accelerates Tesla’s lead in the self-driving space worldwide. Further, it builds data that will be needed for robotics, AI and more.

It’s also a kick in the asteroids for Western governments that they need to stop thinking about all the reasons they can’t do something and begin focusing on the reasons they can.

I get it... China will use the FSD to spy, to assemble data, to pry into our lives... but that horse left the barn decades ago.

China can already get all the information it wants from Google, Facebook, Instagram, TikTok and more. And don’t even get me started on all the think tanks, endowments, and funding for our finest cutting edge academic research facilities. 🤦‍♂️

Like it or not, odds are China’s economic footprint will increase.

And whether you like the man or not, Musk knows it which is why he isn’t wasting time inside the Beltway.

A triple in 3-5 years, or at least imho.

3 – Phillips settles, 35.83%

Koninklijke Philips NV shares have tacked on 35.83% today as I type which makes sense considering that the company just reached a $1.1B settlement for personal injury cases linked to the recall of some of its sleep apnea devices. (Read)

The question, of course, is what to do now if you own stock.

The investor in me sees that orders are down 7 quarters in a row and thinks that the company will have a long road ahead. I could make the case for patient money but absent a dividend, meaningful growth and all the other stuff I’d normally want to see, nope. There are bigger, better, and faster growing fish to fry.
The trader in me says never look a gift horse in the mouth. I can easily envision a quick move lower and back to the $20-$25 range. Putskies.

4 – Winners and losers play differently – mon dieu!

I often make the case that not all tech is the same.

Here’s another example.

Oracle and Palantir are teaming up because business is booming. But French IT firm Atos is in such terrible shape that the government may take it over. (Read)

I can only shake my head.

Reminds me of Intel and a dozen other companies that are struggling to remain relevant despite the fact that they exist in businesses that are booming and, in many cases, that they helped create.

And people wonder why I emphasize CEOs as part of the investing process!

Invest in the best, ignore the rest.

5 – Is Amazon stacking the deck?

This makes me suspicious.

Amazon rolled out what strikes me as a very conveniently timed press release today trumpeting the fact that it’s delivering a greater share of orders the same or next day to Prime members in 60 US metro areas. (Read)

I can’t help but wonder if Amazon is losing ground to Walmart.

I am also leery about this kind of announcement ahead of what is by all accounts a deepening FTC antitrust probe.

Still, Amazon reports tomorrow and the numbers are expected to be rock solid. I’m very focused on EPS because I think that cost-cutting efforts are probably going to show some serious traction as will cloud-computing demand.

And not for nothing, pressure’s on for a dividend.

Expecting the big money traders to make some big moves ahead of time.

Most of which I will summarily ignore and encourage you to as well.