Unveiling opportunities in 11 stocks
On Ausbiz's show, the Call, Moomoo's Market Strategist Jessica Amir took a deep dive into 11 international stocks, including popular stocks such as NVDA, MSFT, and GOOG. Jessica Amir and Nadine Blayney were alongside investment manager Lachlan Hughes CFA. Keep reading for a summary of the interview, or follow the link to watch the full video.
1、Nvidia (NVDA)-Bullish
Jessica concludes that Nvidia's bullish outlook is fueled by the launch of its new AI processor, Blackwell, which meets the growing demand in the robotics sector. In addition to this, there are positive financial indicators in an optimistic market.
In the ever-evolving landscape of robotics, recognizing this need for innovation, Nvidia recently unveiled its latest AI processor, Blackwell. While the announcement initially failed to impress investors, with shares experiencing a dip, options activity reveals an intriguing trend. The YOLO trading crowd appears to be betting on the stock potentially doubling in value by Friday. Despite the new chip being 30% more expensive, Nvidia(NVDA) boasts impressive figures with 36 times forward earnings, net income growth at 55%, and earnings growth at 65%. With this new chip priced at 30,000, the future of Nvidia seems promising in the realm of robotics and AI.
2、Microsoft (MSFT)-Bullish for long term
Jessica stated that the key factors contributing to the bullish outlook on MSFT for the long term are as follows:
Strong financial performance: With consistent net income growth of 35% annually and EBITDA growth of 52%, it is projected to trade at 35 times forward earnings and an EPS growth of 16% for the next 5 years.
Leading position and diversified product portfolio: As the largest global software and cloud computing company, Microsoft holds a leading position with a diverse product portfolio covering various areas including Windows, cloud computing, gaming, LinkedIn, and others, ensuring stable revenue streams.
Application of artificial intelligence technology: Leveraging its vast data resources, Microsoft drives the development of artificial intelligence technology and continuously introduces new AI applications through collaborations with other companies, laying a solid foundation for future growth.
Diversity in leadership: Microsoft boasts the highest representation of women on the board among the top 10 US companies, with 42% of the board being female.
Exciting future developments: Collaborations with companies like Nvidia alongside upcoming product launches and events signal a dynamic and promising future for Microsoft.
3、 Alphabet (GOOG)-Bullish for long term
Jessica suggests that Google (GOOG)still has untapped potential waiting to be developed, offering new opportunities for both consumers and businesses. The following are two perspectives worth attention:
Market position and financial performance
Google, the global search engine leader, commands 75% of the internet search market and 85% of mobile searches. Its AI integration drives profit growth. In addition, GOOG is trading at 21 times forward earnings， with a 16% EPS growth projected for the next five years. It's a cheaper alternative compared to S&P500 and Nasdaq.
What's ahead?
Google strengthens its partnership with Nvidia (NVDA), adopting new AI computing platforms and cloud services, promising further innovation. Also， The upcoming Google Cloud Next event in April sparks anticipation for new advancements and offerings in cloud technology.
Talks with Apple suggest the integration of Google's AI into iPhones, potentially expanding their partnership beyond the Safari default search. Jessica believes this presents a truly compelling investment case in the global space right now.
4、Costco (COST)-Neutral if you are in it
For Costco (COST), Jessica presents the following four points as evidence of maintaining neutrality if you are in it.
Retail Dominance
Costco stands out as the largest and fastest-growing retail chain, catering to the cost-of-living pressures through bulk purchasing options.
Consistency and Culture
CEO Roland Vachris, the third CEO since its 1983 inception, exemplifies consistency and culture, starting as a forklift driver and leading with reliability.
Financial Strength and Momentum
Costco's net income is growing around 3% per annum, with 5% EBITDA growth, and trading at a record high with forward earnings multiple of 46. An EPS growth of 8% is also projected for the next 5 years.
What's ahead?
Anticipating strong growth in 2024, Costco sees an 8% increase in membership in the quarter and an 11% increase in executive members.
Considering options like raising membership fees or offering special dividends, Costco remains an enticing investment opportunity for stability and growth in the retail sector. Jessica suggests uncertainty regarding membership fees increase, but if you're seeking a staples company with a "quasi subscription" model, Costco is the ideal choice.
5、MC -LVMH-Bullish for the long term
Jessica mentions that if you had bought LVMH after her discussion on Valentine's Day on the show, you would have seen a 6.5% increase. She suggests averaging in if you're still interested, noting that historically, LVMH tends to pull back after being overbought.
LVMH is the fastest-growing global luxury spending company, boasting 75 prestigious brands such as Christian Dior, Fendi, Bulgari, and Sephora. Luxury spending reached a new high last year, totaling €1.5 trillion, though the company still awaits the strengthening of the Chinese consumer market. Jessica remarked on LVMH's finances, noting that it trades 28 times forward earnings, with earnings growing at 33% and profits at 18%, while also offering a dividend with a forward gross yield of 1.5%.
Looking ahead, revenue is expected to increase by 5.5% this year to a record $90.8 billion, with strong cash flows and profits. However, projections have slightly diminished due to Chinese consumer fatigue, though Japan has shown robust growth. The wildcard for the year ahead is China, with potential rate cuts to stimulate spending. Since LVMH's revenue is primarily driven by Chinese customers (30.8%).
The company has also designed the medals for the 2024 Olympic and Paralympic Games. However, headwinds such as concerns over cheap labor exploitation in the fashion industry could pose ESG issues for 2024, particularly since fashion and leather goods account for 49% of the group's revenue.
6、Newmont (NEM)- Bullish for long term
Newmont (NEM) is poised for a bullish trajectory in the long term, especially with the anticipation of a new gold cycle. Jessica says despite hitting 4.5-year lows, it's expected to shine and continue to move up.
As the world's largest producer of gold, Newmont (NEM) stands at the forefront of the industry. Trading at 17.6 times forward earnings, with earnings increasing by 35% and net income growth of 11.4%. Additionally, it offers a forward gross dividend yield of 2.93%. Shares have already risen 15% off their 4.5-year low.
Looking ahead:
The recent surge in gold ETF flows signals a potential shift in investor sentiment.
Customers typically turn to bullion ahead of a rate-cutting cycle due to the drop in inflation-adjusted rates, benefiting gold as it pays no interest.
Historical patterns suggest that gold could rally again and reach new records, particularly as the last three times the Fed cut interest rates, gold experienced significant gains.
This presents a compelling opportunity, especially with the expected resurgence of gold ETF investors and increased interest in gold futures, potentially making it an undervalued investment opportunity.
7、Novo Nordisk (NONOF) - Bullish on untapped drug discovery
Novo Nordisk (NONOF), founded in 1923 in Denmark, has diabetes and obesity care drugs making up 92% of its revenue. With the development of groundbreaking drugs like Ozempic, Novo Nordisk leads in the treatment of diabetes and rare diseases like Hemophilia. Despite being expensive, it's cheaper than competitors like Eli Lilly.
Jessica expressed bullish on untapped drug discovery, but investors should also think in the long term. Novo Nordisk (NONOF) is investing in drug discovery with a new supercomputer powered by Nvidia's AI technology, aiming to uncover new medicines and treatments. Also, with the prevalence of type 2 diabetes expected to rise, particularly in rural and low-income areas, Novo Nordisk (NONOF) sees growth potential in expanding into new markets, especially China, where it's revamping its Insulin Plant with a $556 million investment. However, semaglutide tablets (Ozempic) are not yet allowed to be prescribed for weight control despite China having the highest diabetes rate globally.
8、GE Healthcare (GEHC) - bullish for long term
GE Healthcare (GEHC) is poised for long-term growth, driven by cross-selling and AI integration, with benefits from products and services. It's the largest imaging and ultrasound company with a 31% market share. GEHC trades at 25 times forward earnings, with earnings growing at 18% and net income growth of 8% which is expected to rise.
Looking ahead:
AI integration presents opportunities for enhanced patient care and operational efficiency, with collaborations with Nvidia showing promising results.
Expansion into China and the anticipated end of anti-corruption campaigns signal further growth prospects.
In summary, GE Healthcare's prospects are compelling, supported by cross-selling strategies, AI integration, and expansion into key markets.
9、Adobe（ADBE）- bullish for the long term and on shares falling 18% from highs.
Adobe (ADBE)holds a commanding 60% market share in creative software for marketing and photography, and still, Adobe's subscription-based revenue model continues to grow. With a market cap of $235 billion and trading at 41 times forward earnings, Adobe shows strong financials, with earnings and net income expected to rise.
Looking ahead, the introduction of Firefly, a new generative AI feature, offers exciting possibilities for image creation and text effects. However, competitors like OpenAI have shown capabilities in creating high-definition video from text, potentially threatening Adobe's market share. Firefly though is $9.99 cheaper than Open AI.
Overall, Adobe's prospects are compelling, with Firefly offering innovative features at a competitive price point compared to rival technologies.
10、Microstrategy (MSTR)
Jessica says she prefers Square over MicroStrategy (MSTR). The MicroStrategy (MSTR)enterprise software maker purchased 9,245 Bitcoin for $623 million between March 11 and March 18. This move aligns with their corporate strategy of investing in digital currency. With a market cap of $24 billion, MicroStrategy (MSTR) trades 44 times forward earnings. Earnings are growing at 5.7%, with net income growth of 97% according to the last filing.
Michael Saylor, the chairman and co-founder of MicroStrategy (MSTR), initiated Bitcoin purchases in 2020 as a hedge against inflation and an alternative to holding cash. Worth noting is the Executive Chair sold $3 million worth of shares recently, indicating potential shifts in company strategy or investor sentiment.
11、Kenvue (KVUE)
Jessica says you’d buy KVUE if you are interested in the growth of consumer brands, but she prefers P&G. Kenvue's Market cap is $38 billion, and is trading at 17 times forward earnings, with 18% earnings growth and net income growth of 8%.
From a long-term perspective, limited revenue growth is anticipated for KVUE, likely in the slow single digits. Jessica remains the preference for Procter and Gamble(P&G).
Click the link below to watch the full interview (Recorded on March 20th):
