Chip and AI Stocks Are Crashing. Here's What I'm Actually Doing
Summary
Couch Investor analyzes the current market downturn, specifically targeting the semiconductor and AI sectors. Couch Investor attributes much of the negative price action to a report regarding a Chinese firm developing DUV lithography machines, which investors fear could disrupt the dominance of firms like ASML. However, Couch Investor dismisses these fears as an overreaction, noting that the production capacity and yields of the Chinese tools are significantly lower than ASML's established technology. Couch Investor also emphasizes that the market is currently bracing for a heavy earnings week and a critical FOMC meeting.
Mentioned Stocks
Reasoning: Couch Investor mentions buying back shares of Rocket Lab that were previously sold at higher prices. Couch Investor believes that anything between $50 and $55 (based on the transcript prices) represents an interesting entry point for the long term, despite the lack of a Neutron launch catalyst in the immediate term.
Reasoning: Couch Investor argues that Micron is a rapidly growing company and the 34% pullback is an overreaction. Couch Investor maintains that the business fundamentals have not changed negatively and the stock remains attractive following the correction.
Reasoning: Couch Investor points out that Nvidia is down 16% recently despite being extremely profitable and trading at a forward PE in the low 20s. Couch Investor views this as an irrational market move that does not reflect the company's strong business growth.
Reasoning: Couch Investor notes that PayPal reported an 'okay quarter' with modest beats and raised guidance. While the partnership with Amazon in Europe and Venmo's growth are positive, Couch Investor wants to see several more quarters of consistent execution before declaring the company fully back on track.
Reasoning: Couch Investor states that Alphabet is testing its 200-day floor. Couch Investor identifies the area between $319 and $324 as a prime long-term accumulation zone before the stock attempts to reach $350.