Following on January 19's "AI: Lessons From The South Sea Bubble".
From Yahoo Finance, January 23:
Nvidia (NVDA) and Microsoft (MSFT) saw their stock prices jump thanks to their big push to invest and make advancements in AI. Thanks to that outsized growth, there is a potential that they will continue to maintain their dominance on the S&P 500 (^GSPC). As they hold their dominance, the outcome of their earnings can have major sway over the broader market.
Ken Mahoney, CEO of Mahoney Asset Management, joins Yahoo Finance to discuss upcoming earnings from major tech companies and how they could have a sizable impact on the broader market that investors would not want to miss out on.
When it comes to expectations for the outcome of potential tech earnings, Mahoney affirms : "There could be a little sell on the news reaction, but I think the guidance is going to be key. The law of big numbers is incredible, I mean Nvidia as an example, last 12 months has doubled topline revenue, expected to double topline revenue in '24 and '25 and the CEO of Nvidia said 'Hey, we're in the second, third inning.' I hear this all the time. 'Ken, I missed it, I missed it.' Well, the CEO, who is really at the epicenter of all this, is telling you that we're probably in the second or third inning. You might not want to stay around until the ninth or extra innings, but there's a pretty long runway to make some money akin to what we saw in the mid 1990s. "
Video Transcript
RACHELLE AKUFFO: The AI-fueled surge in tech shares though pulling stocks out of their lackluster start to 2024. The S&P 500 and Dow notching another record-high close on Monday, that was thanks to Wall Street's optimism for potential rate cuts, an upbeat read on consumer sentiment, and the AI euphoria continuing to power stocks to new record highs. With tech earnings on the horizon, our next guest sees earnings from the likes of NVIDIA and Microsoft pushing markets into a parabolic mode. Let's bring him in, Ken Mahoney, Mahoney Asset Management CEO. So Ken, talk about this parabolicrise and as well as the risks that the tech sector could face that might upend some of this market euphoria.
KEN MAHONEY: I love the word parabolic. I think my high school teacher would be very proud of me that I've actually still used it I don't know how many years later, 40 years later. But again, there's a lot of reason why they have a strong tailwind, you know, NVIDIA, Microsoft, and so forth.
But first off, one thing that doesn't get mentioned a lot in the media, I believe, is a weaker dollar, right? So inflation has come down, interest rates have come down, and a weaker dollar really helps out earnings from multinationals. And I think the analysts on these companies have sniffed that out.
When you look at NVIDIA, by the way, even the last couple of weeks, we saw Taiwan Semiconductor, their largest contract manufacturer in the world for chips, they own about 55% dominant. They are smoking over there. They're doing really well....
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NVDA is up $16.68 (+2.79%) on the day, $615.41 last after setting another all-time-high at $620.10.
The company usually reports earnings at the end of February, I don't have the exact date right to hand.
Recently: "Chips: "Mark Zuckerberg Says Meta Will Own Billions Worth of Nvidia H100 GPUs by Year End" (META; NVDA)"
