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☕ Read this first if you’re tempted to buy EVgo

Oct 03, 2024

Good morning! 👋

The markets are not particularly inspiring today as traders await tomorrow’s jobs report (and smart investors, in turn, wait for any opening the go-fast crowd creates) so I suggest we use the opportunity to do some big picture thinking.

Here’s my playbook.

1 – Nvidia + Accenture = more AI $

Nvidia and Accenture announced that they will be expanding their partnership to form a new business group specifically to help enterprises adopt and scale AI (Read)

Excellent!

As I’ve noted on TV several times recently, every $1 in AI-related spending currently results in $5-$10 in follow-on spending. There is no doubt in my mind that’ll be $20-$25 within the next five years.

AI is still – as I noted on CNBC a while back much to the surprise of many and long before the narrative that is with us now - “the single largest investing opportunity in recorded human history.” (Watch)

As for Nvidia itself, the dang stock is +146.73% YTD.

The naysayers and nonsense brigade will have you believe that Nvidia has seen better days. Even CNBC’s Jim Cramer called it a “wasteland.”

Wanna bet?

I do.

Nvidia can’t produce chips fast enough and demand is off the charts according to every data point at my disposal.

History, btw, suggests that there are 10-15 “Nvidias” out there right now in various stages of maturity. OBAers, of course, know all about that and I’ll be here if you’d like to join the Family.

If not, totally cool – most investors still don’t have a clue about how to find big runners with gobs of profit potential, so I’m thrilled if you’ve got that covered!

2 – Amazon does a layoff without calling it that

CEO Andy Jassy’s told his workforce that they will need to return to working in the office 5 days a week. (Read)

73% of Amazoners say they’re considering quitting in response according to a poll by Blind, a job review site. More than 1/3rd say they know someone who’s handed in their walking papers as a result.

Brilliant!

Jassy gets to clean house by allowing employees to self-eliminate which does away with workers comp, lawsuits, separation packages, insurance expenses and more.

I still won’t touch the stock though.

MyPOV is that there are far better choices for your money not the least of which includes Microsoft which has returned 201.35% over the past 5 years versus Amazon which has returned 110.09% by comparison. You know what to do.

3 – Gold rush to fashion flush: Levi’s lost its mojo

There are few brands with as storied a history as Levi’s.

The company has its roots in the American Gold Rush of the mid 1800s and is regarded as uniquely American as apple pie by many.

Not anymore.

The rise of stretchy, casual wear – so-called athleisure clothing – from the likes of Lululemon, Adidas and Sweaty Betty among others has cost it dearly.

Levi’s was down -12.58% in premarket trading on news that revenue is flat even though sales of Levi’s Brand are +5%, the biggest gain in 2 years. (Read)

But here’s the thing.

This isn’t about jeans, fashion, or athletics.

Society as a whole has traded in gold-rush dreams for binge-watching marathons and an extra serving of whatever we fancy. Elastic waist wonders are simply more appealing and, evidently, profitable.

Short or avoid.

MyPOV: Strong mind + strong body = strong results.

4 - Read this first if you’re tempted to buy EVgo

JPMorgan says EVgo could surge 80% and has placed it on their Positive Catalyst watchlist, whatever the heck that is??!!

Predictably, the stock has popped +47.27% as I type.

Should you buy it?

I’m not.

EVgo has received a conditional commitment for up to $1.05 billion in debt financing from the U.S. Department of Energy's Loan Programs Office to expand its fast-charging network.

Three things come to mind.

First, Tesla’s already got a de facto global standard, and it works beautifully.

Second, investors are desperate with a capital “D” if a stock like this moves like that on a “conditional” commitment rather than actual results. Remember Solyndra??!! Intel comes to mind too despite the $3B in funding via the CHIPs Act.

And third, the timing is just a little too convenient for my taste. It’s a $5 stock (after today’s run up) at a time when the car-buying public is shying away from EVs as a whole. I wonder who in JPM’s client base is already set up long or if it’s the “house” itself. 🤷

5 – Revolut tells Meta to own up

I’ve been waiting a long time for a headline like this one.

British fintech giant Revolut has told Meta that the company should compensate victims to scams perpetrated on the company’s sites. (Read)

Revolut data show that Facebook was the most common source of all scams reported by Revolut users, accounting for 39% of fraud – like that’s a surprise - whilst WhatsApp – which is also a Meta property - was the second-highest source of such events with an 18% share. (Read)

Tally?

That’s Meta for the win with 57% of scams.🤦

MyPOV: Leadership starts at the top and I’ve made no bones about the fact that Facebook, Meta, whatever you wanna call it, has never owned up for any of the problems it’s caused. Not only that, but every time El Zucko and his C-Suite denies something, proof seems to surface later followed by a thinly veiled mi culpa.

Keith’s Investing Tip: Many investors love Meta with good reason - it's returned +90.65% over the past 12 months. But then gripe about booze, firearms, and fast-food stocks as not being acceptable investments. To each his or her own. I’m just as happy that you own it if you own it that I don’t.