Market Talk
These are fast moving times. One day a company is a pillar of Wall Street financial confidence, the next day something happens to make it a sudden stock that has people trampling on the way out. Jensen Huang, Nvidia ceo , crashed the quantum stocks with him stating they are 20 years off. That was like yelling fire in a movie movie house to traders/ investors of Quantum. Today, some pundits are now taking a counter view of not so fast to dismiss quantum and perhaps Jensen is more likely protecting his turf of high powered and expensive Nvidia GPU processors
Then suddenly - China's DeepSeek open-sourced their Large Language Model (LLM) with the argument that it supposedly reduces the very need for such high powered processors. Yes indeed, Nvidia lost over $ 500 BILLION in market cap. Did Jensen bring on what some may view as a "karmic ying- yang" to perceived demand of expensive Blackwell GPU processors?
Some pundits are countering with the AI centers will still need gads of processors, but perhaps not the latest expensive ones. And what about memory chips? They still need memory, so perhaps the makers of DRAM chips got punished a bit too much? Some of the large cap outfits like Microsoft are rethinking their expense budgets for AI data centers. Perhaps the market is in a wait and see mode on some of the tech stocks as to earnings impact.
So where do we stand and is the the dust settling?
In
the few days since, the stocks are trying to comeback, including NVDA. But the impact
of better, faster and possibly cheaper notions of AI services are still being
absorbed. However, some tech stocks are starting to rebound with mixed sentiments on various notions of the future.
At
the end of every post here at the Jones report, the note about seeing
how our views match up to the reality of the time. Recent events show
how fast things can change in a world where everything is relative to
everything else in value.
What action YOU may take is up to YOU. Here are a few more Stock notes from the desk of Spider J. Jones - (and pay no attention to the man behind the curtain...)
Stock Talk
Kratos Defense & Security Solutions, Inc. (KTOS)
The need for a strong defense requires constant vigilance in America. Before reading further, be aware that some cold hard truths here may be disturbing. In some areas, America is behind our adversaries in the defense department. Both China and Russia have the edge in hypersonic missiles. This presents a potential dangerous situation in the balance of power that has kept the world from mutually assured destruction. When one crazy regime gets a notion they can take us out faster than we can likewise respond, it opens the door to a sneak attack.
Chinese hypersonic missiles can come in from the edge of outer space at 2 Miles Per SECOND.
KTOS is smaller in size, not as well known as some of the big companies they work with - But, KTOS is a key player in helping America stay safe in various areas of development. Ranging from working as the lead on hypersonic test beds, rockets, subsonic and even stealth drones, autonomous travel, AI, 3 D printing, seamless satellite communications and integration of missile defense systems. Some of the recent contract awards point to staying the course with KTOS. The need for Defense requires constant vigilance in America.
The current view here remains: some KTOS over time in a $ cost average mode. For us little people - Keep it simple, five or ten shares here and there.
Update: Another KTOS drone UTAP- 22 an interesting one to run some dd on. It can carry a payload like the Mako series hypersonic missiles under development with Lockheed Martin.
Kinross Gold Corp (KGC) : Gold mining with steady earnings and a divy too.
Permian Resources (PR):
With easing of past natural gas restrictions, a new renaissance back to
cleaner and reliable energy that nat gas brings. PR with Oil and
Natural gas co in the Permian basin of America. Drill baby drill staying
the course with some PR.
Altria Group, Inc (MO) : Steady earnings and a near 8% high dividend to reinvest. The recent earnings report beat estimates with a buyback in process. There was a recent court decision that could adversely impact their importing of NJOY devices. However an updated ACE-2 vape is in development and planned for manufacture in the US places such as Richmond VA. The view here is to hold some MO and watch developments.
Quantum stocks: QBTS, RGTI, QUBT
The ying-yang that Jensen of NVDA threw on the quantum world may have been overdone according to some pundits. These remain speculative. If trying to trade it may be more QBTS shares at half the sp, with some RGTI and QUBT as a side dish. BUT these are spec stocks to us little people, so NOT too much of any portfolio. The Jones view is trading stocks and as "a trade" ? who knows? the market will do what it will do- caution to the brave or fools depending on your own risk tolerance.
Update: Watch BBAI
The AI company PLTR made 20 cents eps and popped over $100. This seems to have ignited more interest into BBAI in the $4's. BBAI is not yet profitable, but the speculative nature of it maybe turning a profit with the recent government contracts is gaining market interest. One wonders if BBAI is becoming a "meme" stock. Some say that PLTR is a meme stock. whatever! It is what it is. Take it for whatever may come - sometimes stocks go up just because relative to others, they appear to be in the sweet spot. But the other side of a good run higher is insider trading, shorts and reality of actual earnings. All in all? BBAI seems like something to watch in the "spec stock" category, eg "a not too much stock", if any - pending your own risk tolerance.
Dry Powder. Maintain some dry powder.
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If you dare ... Stay tuned and aware ....
For now, we close by noting that any view on the market and stocks on any particular day may change in the future days to come. That is why we watch and see how our views match up with the reality of the time. But trying to look ahead a few months into the future may be a way to do things. If you think too deep about world events and the recent alliances forming, projecting ahead can be a dicey endeavor. In all - we use the word maybe "some", not "too much" and play it accordingly. Remember, never get arrogant in our various notions because things do change in the market and individual stocks are subject to many factors outside of our control.. So we try to -stay aware.
With all the above caveats and attempted prognostications, I will close this post. Stay tuned for more opining on the market and stocks to watch.
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