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Roula Khalaf, editor of FT, chooses her favorite story in this weekly newsletter.
The problem with the future is that this has not happened yet. Fasting on companies whose value is mostly resident in educated speculations, therefore, not for weak stomachs. Nvidia, Palantir, Applvin and Microstrategy-four the best best supplies of American technology from 2024, in investors.
Nvidia, with its pure size, inspires more cortisol than most. A 3ntn $ 3thn chips manufacturer whose silicon power of artificial intelligence flourishing has almost tripled in market capitalization in 2024, but this year fell by about 6 percent. His earnings in the fourth quarter have comfortably won the expectations of analysts, but investors are more focused on what follows.
For now, they will plan everything. Chief Jensen Huang says the demand for new Blackwell chips is “amazing”. Profitability is a little squeezed with new ranges, but revenue for the current quarterly period should be higher than it was previously thought. The problem is that the detail is beyond that is beyond that. Every quarter is new nails.
Buying a company’s stock is always a bet on distant income flows; The lion’s share of value comes from the “terminal value”. For example, take the next five years of assessment of analysts about NVIDIA’s cash flows, according to Vidible Alpha, a discount on 10 percent per year, and today they are worth just over $ 500 billion. This means that 80 percent of NVIDIA market value consists of 3 ttn consists of maturity after 2030.
Much can happen in these short times of time. Just ask millions of investors who have never heard of Nvidia five years ago. And technological stocks are unusually sensitive to sudden shifts. Nvidia, for example, receives about one -third of his income of only three customers, who in turn sell their goods to others. Its sales in China are subject to tariff policy that, as Trump’s administration has shown several times, can be included.
Other members of this fantastic four have a harder time. The Palantir S However, however, it is traded with about 50 times forward, which is why Nvidia feels positive 16 times. Microstrategy, meanwhile, has its unique Supreme: it is mostly a Piggy bank filled with Bitcoin, whose price – always Mercurial – abolished.
Applevin’s turnaround is especially sudden. The company, which broke out for advertising premises within the game applications, abolished after two short seller reports suggested that his rapid growth might be less sustainable than he looked. Slower, more predictable companies are much less sensitive to such an attack on trust in the future flow of investors.
For Nvidia, some things are, at least, safe. His biggest customers – companies like Microsoft and Amazon – have Gotovina bins and are determined to spend it on chips. They currently have little, if any, other options when it comes to AI processors. And for now, investors are relaxed. The stress test has passed; Others will meet soon.
