☕ Apple’s AI is most important debut in a decade

Good morning! 👋 

Hope you had a fabulous weekend and are ready to rock ’n roll!  

I am. 

Here’s my playbook. 

1 – I'd be surprised if we didn’t get some selling this week 

Many professionals who thought they were smarter than the rest of us missed out on the rally. Others that caught it are keen to take profits.  

Between the two groups, they’d probably like to do some selling.  

Why? 

Same reason I’d love to see it. 

That way they – and WE - can buy into many of the great names we talk about frequently at lower prices.  

Get your buy list ready now, ahead of time! 

June is traditionally a rough month for markets which means counter-intuitively that it can be great for savvy investors who are thinking ahead like we are. 

Keith's Investing Tip: Many people hear this and flip out because they fear uncertainty. What they fail to grasp is that chaos always creates opportunity. Not sometimes, not part of the time, not every now and then. Always!  

The market is the only store on the earth where people fear a sale!! 

2 – Nvidia: where to next and how high could it go 

Shares are open this morning at around $120 or so but my expectation is still $200 - $230 within the next 12-24 months. Perhaps a whole lot sooner. (Watch)

Here’s why: 

1. Product demand continues to accelerate, and all indications are that Nvidia will sell every chip it makes for the foreseeable future 
2. There are already upgrades in the pipeline (Blackwell and Rubin) 
3. Raising guidance (which management wouldn’t do if it wasn’t confident) 
4. Explosive revenue and EPS growth 
5. Increased post-split accessibility, liquidity, and investor psychology 

You know what to do. 

If not or you’d simply like some help, I’m here. 

Keith’s Investing Tip: Nvidia is now $120 or so a share which means that there is no excuse whatsoever not to buy, or at least that’s my two cents. And if you’re worried about valuation, you owe it to yourself to learn the truth about PE Ratios, a topic I just covered btw in the June Issue. 

3 – Apple’s AI is the most important debut in more than a decade 

Team Cook rolls out in force later this morning for the WWDC ‘24. (Watch live) 

I’ve written and spoken extensively about what I expect to see... everything from new iOS’s in each product line, new chips etc. But the real upgrades will be some form of AI “on board” and the dawning recognition that Apple is considerably farther along than the investing public realizes. 

That said, I also expect to hear from the “smartest people in the room” who will grouse all day long about how “disappointed” they are with this or that... all of which is a) intended to make ‘em seem smarter than they are and b) take prices lower so they’ll have the opportunity to add shares more cost effectively and less expensively.  

CNBC, for example, is already out with a story this morning talking about how Apple’s “under pressure” to show off. (Read) 

Like hell. 

Longer term, Apple is not only a player but still sets the bar. 

Shares have returned 326% over the past 5 years and 843% over the past 10. The S&P 500 has turned in 101% and 226% over the same period respectively. 

The big jump I’m looking for is AI “on board” which, if Apple rolls it out like I think, will usher in an entirely new form of what’s called, “efficient AI” which will work very differently than current generative AI models that need to connect to the cloud to work. 

Investing Implication: On board AI is a serious gamechanger because it means that the company could – once again – lead the way in privacy, efficiency, and interactivity because the jump will allow Apple users to answer sensitive questions without having to risk sending their information back to Apple servers (or anybody else’s for that matter). 

My friend and colleague Dan Ives and I are in complete alignment. 

$275. 

4 - Will we ever get an interest cut?!?! 

Fed funds futures pricing now indicates the probability of a rate cut this month and next month at dang near zero. September is now just 54%. A few months ago, these numbers were 75% - 80%+. 

Not that I’m surprised. 

Team Powell still doesn’t get it. 

The 2% thingy was pulled out of thin air, none of the tools they use can work as long as the government continues to spend money, and their models are busted. 

Focus on companies that can profit anyway and which do not depend on the Fed whatsoever. Names we talk about constantly. 

5 – Moderna's combo cocktail and insurance premiums 

Moderna says its combination Covid/Flu Vaccine is more effective than either on stand-alone basis.(Read)  

Pfizer, BioNTech and Novavax are hot on the company’s heels. 

Here’s the rub and where it gets interesting. 

People are still focused on the whole vax/no-vax thing. 

What you want to think about as an investor is where this is going, regardless of how you feel about the situation. 

I maintain that we’re on the cusp of customizable medicine which means that companies using mRNA tech and AI could see new upside ahead as that emerges. History suggests very clearly that buying now while they’re beaten down and nobody sees it coming is the smart move. 

My two cents is that several of the best choices have tremendous growth and dividend potential on tap. Otherwise, buy an ETF like VHT and be done with it. 

MyPOV: Sadly and on a related note, insurance companies won’t use this as an opportunity to lower premiums but, probably more likely, jack ‘em even higher. I think it’s disgraceful because more effective technology could significantly reduce the impact of respiratory viruses on our health care system. But hey, what do I know – common sense is long dead and buried in this country. 🤦‍♂️ 

Bottom Line 

You can have results or excuses. 

Not both. 

MAKE it a great day – you got this! 

I promise. 

Keith 😊