Today's Buyers Are Tomorrow's Winners - Stocks To Buy Today
Summary
TLDRIn this video, the speaker passionately discusses the transformative potential of artificial intelligence (AI) and its ability to provide access to the world's knowledge. The speaker believes AI will dramatically enhance decision-making capabilities across various domains, from investments to climate. To identify the companies driving this AI revolution, the speaker meticulously analyzes their research and development spending, considering it a telltale sign of future growth. The speaker shares a detailed spreadsheet tracking companies' financials, aiming to uncover the stocks poised to deliver the rewards of AI advancements. With an emphasis on investing in the future rather than chasing current trends, the speaker invites viewers to join this journey of harnessing AI's power for personal betterment.
Takeaways
- 👨💻 The speaker believes AI will give access to all the world's knowledge, enhancing one's intellectual capabilities and decision-making abilities across various domains.
- 🧠 The speaker wants to identify companies investing heavily in AI research and development, as they are likely to be the ones enabling this AI-driven future.
- 📈 Snowflake, Intel, and Meta are highlighted as companies spending a significant portion of their revenue on R&D, indicating their commitment to AI advancement.
- 💻 The speaker tracks companies' R&D spending as a percentage of revenue to gauge their potential role in the AI revolution.
- 🔍 Companies like Nvidia, AMD, and Supermicro are seen as crucial infrastructure providers, enabling the AI applications developed by other companies.
- 📊 A spreadsheet is used to analyze companies' financials, analyst ratings, fair value, and potential returns based on AI-driven growth projections.
- 🎯 The speaker aims to identify companies that are currently sacrificing short-term earnings for long-term AI capabilities, viewing it as an investment in the future.
- 💡 The underlying belief is that AI will significantly enhance knowledge accessibility and decision-making capabilities across sectors like investing, health, and climate.
- 🚀 Companies like Rambus and Cadence are highlighted as potentially undervalued AI plays due to their high R&D spending.
- 🔑 The key is to anticipate where the AI "puck" is going, not just where it currently resides, requiring patience and understanding of the driving forces.
Q & A
What is the main topic of the video script?
-The main topic is artificial intelligence (AI) and its potential impact on accessing knowledge and transforming life. The speaker discusses investing in companies that are driving AI development and infrastructure.
Why does the speaker want to know which companies are buying products from companies like NVIDIA, AMD, and Micron?
-The speaker believes that the companies buying these AI-related products are likely to be the ones that will provide access to the vast knowledge and capabilities enabled by AI. By investing in these companies, the speaker hopes to benefit from the transformative potential of AI.
How does the speaker determine which companies to invest in?
-The speaker has created a 'cheat sheet' that tracks various metrics for companies he believes are involved in AI development. One key metric is the percentage of revenue spent on research and development (R&D), which he sees as an indicator of a company's commitment to advancing AI.
What is the significance of Snowflake's high R&D spending according to the speaker?
-The speaker views Snowflake's 46% of revenue spent on R&D as a 'no-brainer' indicator that the company is aggressively investing in its future and AI capabilities. This high level of spending, despite negative short-term earnings impact, signals to the speaker that Snowflake is a player worth considering for investment.
How does the speaker's investment approach differ from simply chasing current high-performing stocks?
-The speaker emphasizes that he is not interested in 'chasing the puck' (i.e., investing in companies that are already successful). Instead, he wants to identify companies that are 'going to where the puck is going' – those that are investing heavily in AI now to position themselves for future growth and transformation.
What is the purpose of the 'cheat sheet' the speaker refers to?
-The 'cheat sheet' is a tool the speaker has created to track various metrics and data points for companies he believes are involved in AI development. It helps him analyze and compare these companies to identify potential investment opportunities based on factors like R&D spending, earnings, analyst ratings, and fair value estimates.
Why does the speaker mention the government awarding Intel $1 billion?
-The speaker cites the government's $1 billion award to Intel as further evidence that Intel is a company worth considering for investment. The award is intended to support Intel's efforts to create semiconductor foundries in the United States, aligning with the speaker's belief that Intel is investing heavily in AI and advanced computing capabilities.
What is the speaker's overall investment philosophy as expressed in the script?
-The speaker's overall investment philosophy is to identify and invest in companies that are actively investing in AI and related technologies, even if it comes at a short-term cost. He believes these companies are positioning themselves to provide transformative access to knowledge and capabilities enabled by AI, which will ultimately benefit investors who recognize and capitalize on this trend.
How does the speaker view the potential impact of AI on people's lives?
-The speaker sees AI as a transformative technology that will provide people with access to all the knowledge in the world, allowing them to make better decisions and improve their lives in various areas, such as investing, food choices, and addressing climate issues. He believes AI will essentially enhance people's intellectual capabilities and decision-making abilities.
Why does the speaker mention the example of a hypothetical drug that could improve physical attributes?
-The speaker uses the hypothetical example of a drug that could enhance physical attributes as an analogy to illustrate his perspective on AI. Just as he would want access to such a drug for a better life, he wants access to the knowledge and capabilities that AI can provide to improve his mind and decision-making abilities.
Outlines
🤖 Understanding the Transformative Power of AI
In this paragraph, the speaker expresses frustration that some people do not truly comprehend the significance and potential of artificial intelligence (AI) in shaping our future. He believes AI will provide access to the world's collective knowledge, enabling better decision-making across various domains like investing, health, and climate. The speaker draws an analogy, likening AI's impact to a hypothetical drug that could enhance physical traits. However, instead of altering the body, AI will enhance the mind by granting access to invaluable knowledge, provided one knows the right questions to ask.
🧠 Identifying Key Players in the AI Revolution
The speaker discusses his approach to identifying the companies at the forefront of the AI revolution. He examines research and development (R&D) spending as an indicator of investment in AI-enabling technologies like GPUs and robots from companies like NVIDIA, AMD, and Symbotic. The speaker is particularly interested in finding out which companies are purchasing these cutting-edge products, as they are likely to be the ones driving the AI revolution and ultimately improving the speaker's life. He shares his analysis of major tech companies' R&D expenditures from the previous video.
📊 Analyzing R&D Spending to Spot AI Leaders
Building upon the previous discussion, the speaker delves deeper into analyzing R&D spending as a predictor of future success in the AI space. He highlights companies like Snowflake, Intel, and Rambus that have dedicated a significant portion of their revenue to R&D, indicating their commitment to advancing AI technologies. The speaker contrasts this with companies like Taiwan Semiconductor and Broadcom, which have lower R&D spending ratios, potentially signaling a lesser focus on AI innovation. Additionally, the speaker examines outliers like RXRX, a drug discovery company with high R&D spending due to its use of NVIDIA's GPUs for drug development.
🔮 Investing in the Future of AI
In this concluding paragraph, the speaker reiterates his belief that AI will significantly improve lives by providing unprecedented access to knowledge. He emphasizes the importance of identifying the companies investing heavily in AI, as they are likely to shape the future and offer lucrative investment opportunities. The speaker advocates for a forward-thinking approach, focusing on where the "puck is going" rather than where it currently is. He views his analysis and sharing of information as a means to help others make informed investment decisions and capitalize on the transformative potential of AI.
Mindmap
Keywords
💡Artificial Intelligence
💡GPU (Graphics Processing Unit)
💡Research and Development (R&D)
💡Stocks
💡Investment Decisions
💡Earnings per Share (EPS)
💡Analyst Ratings
💡Fair Value
💡Price-to-Earnings (P/E) Ratio
💡Foundries
Highlights
The speaker believes that artificial intelligence will give him access to all the knowledge of the world, comparable to a drug that enhances his physical appearance and abilities.
The speaker wants to know which companies are buying hardware like GPUs and chips from companies like Nvidia, AMD, and Micron because they will be the ones changing his life through artificial intelligence.
The speaker analyzed which companies are spending the most on research and development, as an indicator of who is investing in artificial intelligence capabilities.
The speaker found that the companies spending the highest percentages of their revenue on research and development are Snowflake (46%), Intel (46%), Meta (27%), and Rambus (34%).
The speaker believes that companies investing heavily in research and development, even if it negatively impacts their earnings in the short term, are positioning themselves for future growth and success in artificial intelligence.
The speaker is trying to identify where the "puck" (opportunities in artificial intelligence) is going, rather than where it currently is, by analyzing companies' research and development spending.
The speaker has created a "cheat sheet" that tracks various companies' financial metrics, analyst ratings, and research and development spending to help him make better investment decisions in artificial intelligence.
The speaker believes that companies like Snowflake and Rambus, which are spending a high percentage of their revenue on research and development, may know something others don't and are positioning themselves for the future of artificial intelligence.
The speaker is sharing his thought process and investment strategy related to artificial intelligence companies, with the belief that artificial intelligence will significantly improve people's lives by providing access to vast knowledge.
The speaker is surprised by Taiwan Semiconductor's relatively low research and development spending (8% of revenue), as he expected them to be investing more in advanced semiconductor technologies.
The speaker notes that a company like RxRx, which Nvidia acquired, has an extremely high research and development spending percentage (292%) due to its low revenue but significant investment in drug discovery using artificial intelligence.
The speaker contrasts companies like Rambus, which are investing heavily in research and development for future growth, with companies like Super Micro Computer, which has a low research and development spending (4%) because they are primarily an assembly and manufacturing company.
The speaker acknowledges that the research and development spending percentage needs to be considered in the context of the company's overall revenue, as a lower percentage for a larger company like Amazon (15%) may still represent a significant investment.
The speaker sees Intel's high research and development spending (46%) and the $1 billion government award to build foundries in the US as positive signs for the company's future in advanced semiconductors.
The speaker mentions that the transcript includes a discussion about his daughter's "Hotel Yorba" sign, which was a tribute to her love for Jack White, the musician.
Transcripts
I got a comment from my yesterday's
video that said that what's the purpose
of all this artificial intelligence and
that I'm coming off as a construct of
all of this hype and what's the purpose
of it and that really puzzled me because
it bothers me that I I think there are
people who do not really understand what
artificial intelligence is and what it
the meaning of it is and how it's going
to change our world and what an
opportunity it presents my my belief is
that this is going to give me access to
all the knowledge of the world so so
comparable if if Eli Lily made a drug
that uh I could ingest and it would make
me beautiful it give me uh three more
inches of height it it build up my
muscle mass uh it'd make my hair thicker
and my eyes Bluer and I'd be the
handsomest dude in the world I'd want to
know where I could get that and have
access to it so that I could have a
better life and and that's what I think
is happening but it's not my body that's
going to change it's my mind that's
going to change it's going to give me
access to all the knowledge of the world
so that all I need to know is what are
the questions I need to ask and so when
I see Nvidia and and uh super macro and
advanc Advanced Micro Devices and
symbiotics and micron selling this
product that is going to change the
world I want to know because they're not
really making the product they're making
the infrastructure that is going to make
the product available I want to know
who's buying it because whoever is
buying uh Jensen's computers or not
computers but uh gpus is going to change
my life so I need to know who's buying
them who's buying uh the the super
macros computers who's who's buying uh
symbotic robots who's buying amd's new
Chips if I know who's buying them then I
know who's going to then give me that
drug that's going to or that that's
going to give my mind the ability to
become a smarter a more intellectual and
make better in decisions whether it's
investment whether it's food whether
it's climate what whatever I want to
know who the companies are so yesterday
in the video I went and I looked and
who's spending the most in in in
research and development and I came up
with the biggest spender is uh is
probably snowflake um and then the
second bigger biggest was Intel and Then
followed by uh meta I I did all that in
yesterday's video so then I said okay uh
let's take that even further you have
this portfolio of some 37 stocks that
you believe and when I say you I mean me
uh are going to be the the uh the
providers of this new knowledge base
that's going to change my life um so uh
who who in that group is spending money
this last year to give them access to um
to nvidias and and super micros and amds
to to their tools that are going to
change my world who who who are they so
what I then did was go through and
search each one of these 30 some stocks
and find out what exactly did they spend
last quarter or last year on research
and development and I think that'll give
me some insight as who the major players
are and and who who who is going to
deliver the the rewards from the
purchase of uh nvidia's gpus um Nvidia
last year sold 61 billion billion dollar
worth of gpus and and other chips that's
up from 26 billion well who bought them
okay and and and where are they where
are they headed right now and how are
they going to be used and processed to
change my life and that's what I want to
take you to my computer and and take you
to my cheat sheet and show you on the
cheat sheet where I've shared that
information so that you can look at it
and say okay I now see that snow lake
has has uh spent
46% of its last year's revenue on
research and development and has hired
an additional or is hiring an additional
thousand people I believe they're a
player and and I'll be damned if their
stock isn't down today it because they
are spending money because they are
hiring people so it is negatively
affecting their earnings today but my
God what it's going to do for their
earnings in the future so I want to go
even deeper and find out who else is
following snowflakes path and is going
to weather the storm we'll get at that
right after I share that this is not
Financial advice this is just me
[Music]
ranting best of us investors presents
carry Greek
[Music]
mire okay this is my original cheat
sheet and it's where I list the bus uh
13 and the bus 12 uh stocks the bus 13
is basically those stocks who have the
data and have the capabilities of
building the infrastructure that we're
going to need to make artificial
intelligence available and then bus 12
is that of um those stocks that I
believe that are going to uh deliver
that to us the software in other words
this is the hardware this is is the
software and what I do is uh track their
their earnings per share over the past
years uh I track analysts ratings of
what their their future price will be I
look at Tech I look at fair value and
then I come up with a price that I want
to buy the stock at uh irrelevant of
what it is right now this is where I
want to buy it such as right now Apple's
selling for 170 I want to buy at 165 and
if I do uh this tells me what my
potential return would be based on my
projections of future price of 35% and
so I do that with every stock um and and
track them and change these numbers as
their earnings change now what I did was
take this and say okay this is all based
on uh if I if I buy it at the at the
price I want to buy it okay so then I
said well let's take that variable out
and and let's say I buy it at the price
it is today what is my potential return
again based on um analysis High uh Tech
uh readings fair value and and then I've
ENT entered another element and that is
the price based on uh in the future
price based on its current PE ratio so
if in fact its uh earnings go up to uh
in in Apple's case to
$657 and it has a PE ratio of
$27.77 what would its price be and it
says it's
$182 based on then a a an average of
these four num four five numbers I would
make 18% on the stock if I bought it at
today's price so that's what that is now
then what I'm talking about earlier is I
want that now to say who who is spending
the money on the future who and and how
will that equate into my purchase price
and my willingness to buy and so what I
did was go in and and uh create a a a
formula to derive of what
percentage uh of their revenues did
Apple spend last year on research and
development because I believe that's
going to tell me how many GPU chips they
bought if that's appropriate for what
their business is and so I then go down
and I come up with that number and as
you can see then I have highlighted
those where it seems to be High
um here you see CN uh cdns uh it spent
35% Intel as we said spent 46 meta
27 um Nvidia
14 um here we have Qualcomm 23 rambus 34
so you can see that this gives me some
guidance of who's playing in the future
uh this one surprised me uh Taiwan
semiconductor only 8% I I and again this
serves as a flag and and that says does
that mean that they aren't investing in
new methods they aren't buying and I
know this is true they are not buying
asml um new um bus new uh tools so they
they have a lower investment number um
and then you can see some that are
outrageous such as rxrx this is the
stock that Nvidia bought some of just uh
um two weeks ago and then bought some
back uh July and
2023 and the stock shot up and now it's
retreating and this is a drug Discovery
company and the reason its its uh
percentage of revenues is so high is
they don't have a lot of revenues and
they're spending a lot of money uh
buying uh uh uh Jensen's um um gpus to
help them uh discover drugs uh I right
now am not in the market to buy that I
think there are other better
opportunities such as here here is
rambus and again uh you can see rambus
has a tremendous history of uh 38% last
year um and and year to date though
they're down 3% well why is that well
they they make semiconductors and some
of them are uh geared towards the EV
industry and the EV industry is down but
yet they are spending 34% of last year's
revenues on research and development to
better their position in the future and
that would tell me that's the kind of
company that I want to invest in well
then why is super macro uh computers
only at 4% because they're a they're a
factory they they they basically put the
parts together and put them in a box and
then sell that box for
$250,000 they aren't they aren't
developing um processes to make the uh
the silicone chip uh more heat less less
more have greater ability to repel heat
they aren't in that business so they
are't in research and development so
again that's that's something that I
need to look at and I'll give you an
example here I have not been high on um
on broadcom and I and and and yet they
have had a very good run uh they're up
115% year to date uh and and their price
is going going up but they only spent
15% and again that that 15% of what
makes a big difference um as you can see
uh Amazon spent 15% or yes 15% but they
are spending 15% of a much bigger number
than rambus is okay uh so that needs
some sorting through as well what I want
to share with you and and and the whole
Purp purpose of all this is how do you
make better investment decisions how do
you find the stocks and sort them
through to to say these people are
investing in the future and maybe it it
costs them in the present as far as
stock price but I've got to believe and
I and I'll come back to it over and over
again snowflake is is a no-brainer
because they are spending 46% of the
revenues they generated last year to
make their company better than it was
the preceding year and if I if I live in
a community and I see someone who is
buying up all the real estate uh and
paying exorbitant prices for it I have
to say to myself they know something I
don't know and I need to dig and find
out what it is they know and I think
that is what snow flake is is showing me
um I think that's what rambus is showing
me I think that's what Cadence possibly
should show me I don't know a lot about
Cadence I know they're a design company
uh but what I'm looking for is okay what
is what's The Telltale sign why is Intel
spending
46% and then you tie to that the
government just awarded him $1 billion
in additional money to spend for
creating foundaries here in the United
States so that we aren't dependent on
Taiwan for our Advanced semiconductors
so does that make sense it does to me so
again I said it in yesterday's video I'm
looking for where the puck is going I'm
not looking for where it is right now
right now it's in Nvidia and super
macros Court are they going to get that
exponential growth from here that I
think I will get with I Intel and a
possibly snowflake that's how I think if
that's how you want to think if that's
the kind of information you want me to
tickle your brain with and say that
makes sense I'm not chasing the puck I'm
going to where the puck is going and
I've got the patience as long as I have
the understanding of what's making it
happen and what's making it happen is a
promise to you that you are going to
have a much better life in the future as
a result of artificial intelligence all
the knowledge in the world is going to
be at your fingertips all you're going
to need to know is what questions do I
need to ask so that I can I can be ahead
of the rest of the world such as right
now that's what I believe I'm delivering
to you the question you should be asking
is of the $61
billion that Nvidia took
in who spent it who's investing in their
future and thus I can invest in them as
well that's what this cheat sheet is
telling you you can have access to it uh
we're it's on sale yes 50% off look in
the description and and join our
platform and I'll give you access this
is on the website and I change it every
day uh I update it I bring it to where
it helps me that's that's what this is
all about helping me make better
investment decisions and I'm opening the
door and saying here's what I use and
here's the logic I use behind it if that
can be helpful for you then I want to
help you all right Carrie grink retired
financial adviser uh also got a comment
on my hotel y yba sign that was that
would belonged to my daughter who passed
away from cancer a Big Jack White fan so
talk to you again
[Music]
tomorrow
[Music]
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