What are you buying today?

[sleepydragon]

10 minutes ago, formthirteen said:

 

What's the thesis behind your decision and timing? Sold some of these last week. I still own ASML. I'm waiting for the last hurrah and the music to stop.

 Ai does make money — i use it at work, and many i talked to use it at work, and some fired people. It’s a huge productivity boost. Brk invest in google making billion dollar bet on building data center. The revenue is real and supply constraints will last a few years. It’s a regime shift that’s happening so fast 

[roundball100]

37 minutes ago, sleepydragon said:

 Ai does make money — i use it at work, and many i talked to use it at work, and some fired people. It’s a huge productivity boost. Brk invest in google making billion dollar bet on building data center. The revenue is real and supply constraints will last a few years. It’s a regime shift that’s happening so fast 

Do we have actual evidence that AI generates profits? Or do you mean that there is revenue (that is, paying customers beyond all the free services to the general public) but not enough to offset expenses incurred by the growth of the AI industry at this point?

[frommi]

48 minutes ago, sleepydragon said:

 Ai does make money — i use it at work, and many i talked to use it at work, and some fired people. It’s a huge productivity boost. Brk invest in google making billion dollar bet on building data center. The revenue is real and supply constraints will last a few years. It’s a regime shift that’s happening so fast 

The question is not if they make money, anybody can see that. The question is if they make at least the same or more money 5-10 years down the road. At the top of the cycle you can buy semis for P/E's of 1 or 2, but thats usually a trap.

[Gregmal]

Yeahhhhh, I don’t think that this whole AI trade thingy is new. Or early. But what do I know? 

[Paarslaars]

There is AI and there is the supply chain. As long as the hyperscalers keep spending capex, the supply chain makes money.

[Gregmal]

A buddy of mine about 4 months ago decided to switch his monthly purchases from a mix of Berkshire and others to just nvidia. When I asked him why he said because of AI. He then asked if I hated AI. I then asked if he realized what percentage of US GDP nvidia needed to become in order to have any sort of upside from a $5T or whatever starting point. He seemed confused and then said “so you dont think AI is gonna be a thing?”….

 

It’s almost like debating with the folks whom are genuinely confused why “oil hasn’t gone up since Iran started”….guess there’s different universes out there or something. 

[brobro777]

Bought some VOO

 

Holy moly 1600 NQ point crack in 2 trading hours - that's scary man

[Pellom]

1 hour ago, Gregmal said:

Yeahhhhh, I don’t think that this whole AI trade thingy is new. Or early. But what do I know? 

 

Ha!

 

A coworker of mine -- no kidding, two weeks ago -- had the realization he should invest in tech stocks because he used AI to help him re-seed his yard for the summer. I didn't have the heart to tell him he's about 40 months behind. 

[sleepydragon]

1 hour ago, roundball100 said:

Do we have actual evidence that AI generates profits? Or do you mean that there is revenue (that is, paying customers beyond all the free services to the general public) but not enough to offset expenses incurred by the growth of the AI industry at this point?

yeah, they do. Claudi code and codex etc is very useful, and people pay for it. It probably save the salaries for 2-3 junior programmers per one team lead. The big tech firms like oracle meta are also fully adopting it to write code. The revenue and benefits are real.  For the AI supplier, SNDK is up like 10x for the past 1 yr , but it’s next quarter earning is higher than its mktcap when it was spinned off 18

months ago from WDC. It’s earning that has gone up a lot. And its revenue is going to sustain current level for the next few years due to supply contraints.  Semi equipment providers have backlogs filled for the next 3 years and revenue growth every quarter from on.

[Paarslaars]

While that does apply to Nvidia, I don't think that applies to the entire AI supply chain. Your friend needs to dig a little deeper.

[sleepydragon]

4 minutes ago, Pellom said:

 

Ha!

 

A coworker of mine -- no kidding, two weeks ago -- had the realization he should invest in tech stocks because he used AI to help him re-seed his yard for the summer. I didn't have the heart to tell him he's about 40 months behind. 

i met a Portfolio Manager the other day who doesnt code. He used to have small team writing code for him. Most of the team is gone. He now put on headphones and talk to AI and instruct it to write code. He has written about 150k lines of code to support his job so far.

[gfp]

covering spy short

 

[Castanza]

1 hour ago, Paarslaars said:

There is AI and there is the supply chain. As long as the hyperscalers keep spending capex, the supply chain makes money.

 

Good luck with that when those "contracts" get canceled.....

[sleepydragon]

 

[formthirteen]

2 hours ago, sleepydragon said:

 Ai does make money — i use it at work, and many i talked to use it at work, and some fired people. It’s a huge productivity boost. Brk invest in google making billion dollar bet on building data center. The revenue is real and supply constraints will last a few years. It’s a regime shift that’s happening so fast 

 

Thanks for sharing. I agree. Intelligence has become a commodity to some degree. Fortunes will be made and lost. The only certainty is that tokens and chips will flow. I'm still long ASML. They will be able to sell all the machines they can manufacture for many years.

[dipod]

Bought a big slug of LQDA common stock and CVRX common stock as well.

[treasurehunt]

42 minutes ago, formthirteen said:

Thanks for sharing. I agree. Intelligence has become a commodity to some degree. Fortunes will be made and lost. The only certainty is that tokens and chips will flow. I'm still long ASML. They will be able to sell all the machines they can manufacture for many years.

 

ASML seems to be trading at a P/E of almost 60, so they'll have to sell all the machines they can make for a decade or two or three to justify the valuation. Doesn't that require a lot of confidence in the long-term competitive advantages of the business? How are you thinking about it?

[Gregmal]

2 minutes ago, treasurehunt said:

 

ASML seems to be trading at a P/E of almost 60, so they'll have to sell all the machines they can make for a decade or two or three to justify the valuation. Doesn't that require a lot of confidence in the long-term competitive advantages of the business? How are you thinking about it?

Not related to ASML but this general line of thought with the broader market is what Im struggling with. Its seems "these are popular and will be in demand for a bit" is all that underpins much of the "buy, buy, buy!" mentality. 

[sleepydragon]

48 minutes ago, formthirteen said:

 

Thanks for sharing. I agree. Intelligence has become a commodity to some degree. Fortunes will be made and lost. The only certainty is that tokens and chips will flow. I'm still long ASML. They will be able to sell all the machines they can manufacture for many years.

besides ASML, another company with almost equal monopoly power is KLAC — i heard this from an ASML engineer. But i am a bit hesitant to buy more because all these semi equipment have 25-40% revenue exposure to china. (ASML is a bit better because they are banned from selling their most expensive machines to china.) still biting my nails on KLAC (and also slightly less moaty lrcx and amat)

 

[sleepydragon]

5 minutes ago, treasurehunt said:

 

ASML seems to be trading at a P/E of almost 60, so they'll have to sell all the machines they can make for a decade or two or three to justify the valuation. Doesn't that require a lot of confidence in the long-term competitive advantages of the business? How are you thinking about it?

it’s all sold out for the next few years. They just have to deliver them.

pretty the entire chip making is these little “mini factory “/machine of asml. There’s no one else.

even Depart of Defense/war buy from them, and can only afford the refurbished machines 

[treasurehunt]

1 hour ago, Gregmal said:

Not related to ASML but this general line of thought with the broader market is what Im struggling with. Its seems "these are popular and will be in demand for a bit" is all that underpins much of the "buy, buy, buy!" mentality.

 

Yes, I have the same impression. If there is tremendous demand for something for the next few years, surely that's an incentive for competition to show up? This is tech, after all. I suppose some of these companies have advantages that cannot be competed away easily, but I don't see much analysis of this.

[Marco Van Basten]

2 hours ago, treasurehunt said:

 

ASML seems to be trading at a P/E of almost 60, so they'll have to sell all the machines they can make for a decade or two or three to justify the valuation. Doesn't that require a lot of confidence in the long-term competitive advantages of the business? How are you thinking about it?

From what I heard, ASML has hardly taken any price.  If that is correct, and given the monopoly position, what will happen to earnings if price gets a 50% price increase?  Suddenly p/e goes to 15?

[Spekulatius]

 

 

11 minutes ago, Marco Van Basten said:

From what I heard, ASML has hardly taken any price.  If that is correct, and given the monopoly position, what will happen to earnings if price gets a 50% price increase?  Suddenly p/e goes to 15?

It’s not going to happen, because are tried at the hip to their customers and they won’t piss them off.

[sleepydragon]

40 minutes ago, Spekulatius said:

 

 

It’s not going to happen, because are tried at the hip to their customers and they won’t piss them off.

you are joking right?

they pick who they want to sell to

[treasurehunt]

27 minutes ago, sleepydragon said:

you are joking right?

they pick who they want to sell to

 

According to ASML's annual report, the top four customers account for 61.2% of total net sales. Sounds pretty interdependent to me.