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Tech Stock Rally Is Just Beginning, Wedbush's Ives Says

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Bloomberg Jun 26 23:39 · 20.5k Views

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  • 00:00 Dan, I guess the big question everybody wants to know is how much life is there in this rally?
  • 00:05 I think
  • 00:06 this is just starting in terms of this next stage of the AI revolution.
  • 00:10 And I think
  • 00:11 as we go into the software phase, you see on the consumer side when it comes to AI,
  • 00:17 I, I believe this is still bottom of the first, top of the second inning.
  • 00:21 And that's why NVIDIA 4 trillion, ultimately 5 trillion.
  • 00:25 Microsoft,
  • 00:26 we think on the road to four and then 5 trillion.
  • 00:29 It's our view this tech bull market, get the popcorn out.
  • 00:33 I think it's going to be a very strong second-half.
  • 00:35 There's only been a lot of talk about the big structural changes that AI is bringing
  • 00:39 not only to the companies themselves, but potentially to the economy and to the markets.
  • 00:43 You're also seeing sort of a similar sort of run for the gold going on right now
  • 00:47 in the autonomous vehicle space.
  • 00:48 And there were just some headlines a while ago
  • 00:50 out of the New York Times that Uber has actually tapped
  • 00:53 its former CEO, its Co founder Travis Kalanick to potentially fund a deal to buy a company called Pony AI, which will makes autonomous vehicles.
  • 01:01 the US arm of Pony AI, I should say that helps to make autonomous vehicles.
  • 01:05 I do want to get your thoughts on that deal and about the amount of money and effort that these companies are spending to get ahead in this self driving ride hailing space.
  • 01:14 Well, that would be the smart move for Dara.
  • 01:17 And I think there could be more behind it because when you look at
  • 01:20 the next phase when it goes to physical AI,
  • 01:23 it's about autonomous and Uber you, when you look at Tesla shot across the bow, everything we saw in Austin,
  • 01:30 you know, that's now started to play there.
  • 01:32 Uber needs to definitely focus on partnerships and expanding their repertoire when it comes to autonomous.
  • 01:40 This would be a smart strategic move, aggressive if they did it.
  • 01:44 How important is that first mover advantage that Tesla and that Waymo currently enjoy?
  • 01:50 Yeah, look,
  • 01:51 first mover advantage is important in terms of Waymo, but the reality is there's a $230,000 cars in four to five cities.
  • 01:58 It's all about scale.
  • 02:00 That's what Tesla's going after.
  • 02:01 And that's why Uber, they can't just sit there and
  • 02:04 Darren knows this on the treadmill.
  • 02:05 They're going to have to aggressively focus on their fleet and what they could do when it comes to autonomous.
  • 02:11 And I think that's
  • 02:13 that's going to be the next chapter when it comes to AI, but it speaks broadly to our view of TAC
  • 02:19 from robotics to autonomous to enterprise to consumer AI
  • 02:24 across the board.
  • 02:25 I mean, this is,
  • 02:26 you know, I believe it's a golden age for TAC.
  • 02:29 So when it comes to funding something like this,
  • 02:33 how much are investors going to be comfortable with that without seeing a return on investment in the immediate near term?
  • 02:38 Because that was a question when it came to building up the
  • 02:41 AI data centers and the AI capabilities.
  • 02:43 And at some point, people,
  • 02:45 investors are willing to give
  • 02:46 the companies the benefit.
  • 02:47 Doubt until it became clear that the spending wasn't resulting in anything tangible.
  • 02:52 Yeah.
  • 02:52 And then obviously, you start, then you start to see it come through.
  • 02:56 And that's why the last thing investors want to see,
  • 02:58 you don't want to see.
  • 02:59 I'm on on the outside looking in.
  • 03:01 I think that's why Apple is underperformed, right?
  • 03:03 Because the reality is
  • 03:04 when we were WWDC, the AI strategy, right, it was kind of shrugged the shoulders.
  • 03:09 Investors right now know this is a Game of Thrones arms race that's going on when it comes to AI.
  • 03:16 Stronger gets strong when it comes to tech.
  • 03:18 But that's why look what's happened with Nadella and Redmond.
  • 03:21 They're just getting strong and strong when it comes to AI because they recognize where the next steps are.
  • 03:26 That's Wilkin names like # tier the messy of AI.
  • 03:30 It should.
  • 03:30 This is not stopping.
  • 03:32 Tech needs to continue to spend.
  • 03:34 I am curious, Dan, how you value these companies.
  • 03:37 I know there's been a lot of talk about how traditional valuation metrics and multiples don't necessarily apply at least to some of these companies, don't necessarily apply in the same way that we have in the past.
  • 03:45 But of course, that doesn't stop
  • 03:47 the bears and the naysayers from looking at those
  • 03:49 traditional multiples and saying, look, I mean, there may be a future here, but at least current pricing seem to suggest that some of these stocks are way overvalued.
  • 03:59 Yeah.
  • 03:59 And look, the haters, I mean, they'll sit there, those bears sitting in the hibernation caves, right?
  • 04:04 They can't find AI in the spreadsheets.
  • 04:07 But it's our view.
  • 04:08 You have to look out three, 5-7 years what the monetization opportunities looks like.
  • 04:14 If you believe on the consumer side, the next stage AI, then that is a four digit stock.
  • 04:18 But it speaks to my view that if you just focus on one year valuation, you missed every transformational growth stock the last 20 years.
  • 04:26 You mentioned Meta is a winner here.
  • 04:27 We're paying attention to Uber.
  • 04:29 What's a company that people are not paying enough attention to that could be a stealth winner here?
  • 04:34 I mean, I think it's IBMI think there's a renaissance that's happening at IBM in our monk.
  • 04:39 I think Arvin's doing a great job and that's further and further monetization.
  • 04:43 I think institution that's still very under owned
  • 04:46 taking a page at Microsoft's playbook and I think it just shows you're now seeing tech spread to the 2nd, 3rd, 4th derivatives.
  • 04:55 That's why we have AI 30.
  • 04:57 It's not just about 2-3 names, of course it's.
  • 05:00 By godfather of AI gents and NVIDIA.
  • 05:02 But it's spread into the rest of tech,
  • 05:04 and that's why it continues to be 10:00 PM in the AI party that goes to 4:00 AM.