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Citigroup: As Apple Inc. expands its smart capabilities, the risk-return profile of Apple Inc. (AAPL.US) stock is "quite attractive."

Citi said on Tuesday that the recent selloff in Apple Inc. (AAPL.US) shares, and the expansion of Apple Inc. Intelligence to multiple new languages, make the risk and return investment in Apple Inc. "quite attractive". Citi analyst Atif Malik wrote in a report to clients, "We believe that Apple Inc. is likely to reshape market expectations for Siri software in the next earnings call before the Worldwide Developers Conference (WWDC) on June 9. After the delay in Siri features led to a selloff in the stock price, Apple Inc. is gradually approaching our pessimistic target price, making the risk and return investment quite attractive at this time." Malik maintains a "buy" rating on Apple Inc. stock with a target price of $275. On Monday, the California-based tech giant released the iOS 18.4 system, which expands Apple Inc. Intelligence to 8 new languages. With the launch of iOS 18.4, iPadOS 18.4, and macOS Sequoia 15.4 systems, these features are now available in French, German, Italian, (Brazilian) Portuguese, Spanish, Japanese, Korean, and Chinese environments. In addition, localized English versions have been provided for India and Singapore. Apple Inc. also brought Apple Inc. Intelligence to iPhone users in the EU region for the first time, and added this feature to Vision Pro as well.
01/04/2025

Goldman Sachs Q1 performance briefing with essential consumer goods companies, saying that exchange rate trends may alleviate revenue pressure.

Recently, before several essential consumer goods companies announced their first quarter earnings, the Goldman Sachs Group, Inc. engaged in discussions with these companies' investor relations teams and released research reports outlining the key points of the meetings. These points will ultimately become the focus of each company's earnings conference calls. These companies include Coca-Cola European Partners Company (CCEP.US), Celsius Holdings (CELH.US), Church & Dwight Company (CHD.US), Colgate-Palmolive Company (CL.US), Clorox Company (CLX.US), VitaCoco (COCO.US), Coty Inc. Class A (COTY.US), Estee Lauder Companies Inc. Class A (EL.US), e.l.f. Beauty (ELF.US), Keurig Dr Pepper (KDP.US), Kimberly-Clark Corporation (KMB.US), Coca-Cola Company (KO.US), Kenvue (KVUE.US), Murphy USA, Inc. (MUSA.US), PepsiCo, Inc. (PEP.US), Procter & Gamble Company (PG.US), and Molson Coors Beverage Company (TAP.US). Recent data and comments from consumer packaged goods (CPG) management at an investor conference indicate that U.S. consumers are showing increasingly cautious behavior due to concerns over perceived inflation, tariff uncertainty, and political unrest like that of GEO Group Inc. This has led to a moderation in consumer trends this quarter, and retailers may engage in destocking due to the pressure on consumer trends, showing more caution in their inventory levels, which also brings related risks. However, the recent favorable foreign exchange rate trend so far this quarter should help alleviate revenue pressures, although each company's earnings may vary. Overall, the bank has seen some short-term challenges and adjusted its estimates accordingly to reflect these dynamic changes before the first quarter earnings season. Recent foreign exchange rate trends suggest headwinds may weaken In 2024, foreign exchange rates are a significant headwind for the entire consumer packaged goods industry, with most currencies depreciating against the U.S. dollar. Additionally, initial guidance for 2025 from various companies shows that foreign exchange rates may continue to be a headwind in that year due to the ongoing strength of the U.S. dollar. Concerns about economic slowdown, political tensions like that of GEO Group Inc, and policy changes including tariffs and immigration policies have increased macro market volatility from 2025 onwards. While it is still too early to determine the final direction of this year, recent foreign exchange rate trends suggest that the U.S. dollar has depreciated against most currencies in 2025, indicating that the headwind from foreign exchange translations may be smaller than what companies expected when they announced their fourth quarter 2024 earnings and initial 2025 guidance at the end of January/early February.
01/04/2025

Can gold mining stocks continue to be strong? UBS is optimistic about investment opportunities in 2025.

yalties)Franco-Nevada Corporation(FNV.US)Overall, UBS Group AG As the price of gold has reached new highs in recent times, UBS Group AG released a research report on March 31, mentioning the similarly impressive performance of gold mining stocks. UBS Group AG pointed out that gold mining stocks performed better in 2025, with the total return in US dollars being about 20% higher than that of gold for VanEck Gold Mining ETF (GDX). But the question remains, will this trend continue? UBS Group AG pointed out that gold mining companies have provided operating leverage for price increases and potential performance improvements in dividend yields, so theoretically, their performance should be better than that of gold during uptrends. However, at the same time, gold mining companies also face resistance from cost/capital expenditure inflation and continuous pressure to deplete resources/increase production. Additionally, the gold industry has performed poorly in creating value through growth/mergers and acquisitions in the past decade, and inflation has often offset gold price increases, leading to continued poor performance of GDX relative to gold, especially after a major pandemic (i.e. around the past 5 years). Gold mining companies need to rebuild trust but the risk-return ratio remains attractive. Due to years of failing to meet performance guidance targets, it is difficult to believe that the gold industry will achieve its established goals and restore investor confidence. Although some companies will inevitably fail to meet production expectations, after years of disappointment, should market expectations be more realistic? The likelihood of a decrease in overall unit costs in the gold industry by 2025/26 is not high. However, at least the cost guidance for 2025 may be more realistic, as some major mining companies (such as Newmont Mining, Barrick Gold Corporation) no longer predict a decrease in unit costs for the next 2-3 years. With gold prices exceeding $3,000 per ounce, in the coming weeks, market consensus will definitely be raised due to the increase in gold prices, which should bring positive momentum to the overall market profit forecasts, and currently the consensus valuation of gold mining companies is significantly below historical levels. From the release of annual reports to the second/third quarter earnings reports, it is usually a better opportunity to hold gold stocks, as rising gold prices usually push profit estimates higher, while downward adjustments in annual guidance often begin to show in the third quarter earnings reports. Although the performance of GDX has been better than gold in the past 12 months, it has consistently performed poorly over the past 10 years. UBS Group AG remains skeptical about whether gold mining companies can outperform gold and mining project royalty companies in the long term. In the short term, gold mining companies have strong momentum (with the GDX relative strength index at around 70), but considering the positive momentum in profit expectations that the market generally expects to be maintained, the industry's overall guidance is more realistic, and valuations are approaching cyclical lows. The bank believes that gold mining companies still offer an attractive risk-return ratio. Undervaluation of gold mining stocks UBS Group AG analyzed the overall Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA), net income trends, and valuation multiples of GDX to determine whether the poor performance of gold mining stocks is due to fundamental factors such as production cuts and cost inflation or a decrease in valuation multiples. UBS Group AG pointed out that in the past 4-5 years (compared to the average level in 2019), the performance of GDX has lagged behind the price of gold by about 40%. Although there is ongoing inflation and poor operational performance, the compression of valuation multiples remains the main reason for the poor performance of gold mining stocks - the 12-month forward price-to-earnings ratio has decreased from 21 times to 15 times, a discount of about 30%; the enterprise value multiple (EV/EBITDA) has decreased from 8.4 times to 7.4 times, a discount of about 10%. Since 2025, the recovery of gold mining stocks has led to a rebound in market expectations for valuation multiples, but with potential profit increases in the coming weeks and valuations still below historical levels, UBS Group AG believes that overall, the valuation of gold mining stocks is still not high. Divergent performances of gold mining companies create investment opportunities In addition to the rise in the price of gold over the past 12 months, another significant feature is the divergent performance of gold mining stocks. Logically, high-cost/high financial leverage miners should perform better; but due to unstable operational performance and increased investor aversion to risks in remote markets (West Africa/Central Africa), stable operating miners in safe jurisdiction areas have performed better (Agnico Eagle Mines Limited, Kinross Gold Corporation, Evolution Mining), while poorly performing miners have been penalized (Newmont Mining, Barrick Gold Corporation, Endeavour Mining). Preferred global major gold miners As expected by the market consensus, UBS Group AG holds a constructive view on the prospects for gold. In their view, the diversification role of gold and gold stocks in portfolios remains attractive, and gold stocks are expected to outperform the market in the next 3-6 months. Due to the significant divergence in industry performance, the valuation gap of gold mining companies is large, which UBS Group AG sees as an opportunity, and they tend to choose some "cheaper recovery stories". Recently, the bank has downgraded ratings for Agnico Eagle Mines Limited (AEM.US) and Gold Fields Limited Sponsored ADR (GFI.US) to "neutral". Among the global major miners, the bank prefers Barrick Gold Corporation (GOLD.US), Northern Star, and believes that after a difficult 2024 year, Endeavour will see good performance in 2025. Additionally, the bank continues to favor mining royalty companies with short-term diversification characteristics, such as Franco-Nevada Corporation (FNV.US). Overall, UBS Group AG believes that the challenges that gold mining companies may face in the coming months will not affect their long-term investment attractiveness, and they believe that the gold industry still has investment potential. royalties)/mineral streaming rights (Streams) model, and prefer Franco-Nevada (FNV.US).Barrick Gold Corporation: UBS Group AG believes that the valuation of Barrick Gold Corporation is very attractive, with short-term operational challenges reflected in conservative forecasts and lower enterprise valuation multiples for 2025 and the next three years. The company has a higher mid-term growth risk, but its 2025 free cash flow yield is comparable to Agnico Eagle Mines Limited and Newmont Mining, with a 30% mid-term growth potential. UBS believes that the market's valuation of its growth potential is still too low. The restart of the Mali project should be a positive catalyst for the stock price, with national/operational risks already fully reflected in the stock price. Northern Star Resources: UBS Group AG points out that the acquisition offer for De Grey Mining has created market uncertainty, leading to weaker performance since 2025 compared to GDX. The bank expects the transaction to be completed in May and believes that the combination of the two companies forms a strong asset portfolio. With the KCGM project expected to reach annual production of 900,000 ounces in the 2029 fiscal year and the potential launch of the Hemi project around the same time, Northern Star Resources' project reserves are attractive, and its management team has good execution capabilities to successfully advance its growth plans. Endeavour Mining: UBS Group AG indicates that Endeavour Mining had a poor performance in 2024 but is at a turning point in free cash flow. With increasing production, decreasing capital expenditure, and strong gold prices, the company is expected to rapidly reduce debt and provide cash returns in 2025/26. Additionally, the company has mid-term growth potential, with the Assafou project in Cote d'Ivoire being worth keeping an eye on. Franco-Nevada: UBS Group AG states that for investors looking to reduce risk and diversify their gold investments, the Royalties/Streams model of mineral rights use fees is still favorable. The bank points out that Franco-Nevada has profit leverage from increasing gold prices, and the commonly expected profit upgrades in the market are also favorable for them. Additionally, the restart of the Cobre Panama mine is expected to bring about a 30% short-term production growth with zero capital expenditure, and news about the project's restart is expected to be a positive catalyst in the next 3-6 months.
01/04/2025

JP Morgan: It is difficult to replicate the performance of the US stock market in 2017, the market may shift towards defensive sectors.

Recently, JPMorgan Chase released a stock strategy report, stating that the differences between the current US stock market and 2017 are still worth paying attention to, but there may also be some similarities. The bank predicts that in the second and third quarters, economic activity will slow down, trade uncertainty will intensify, and other unfavorable factors will resurface, causing the market to shift towards defensive sectors. From February to March, the S&P 500 index fell by 10%, and the "Mag-7" stocks that had been rising in the fourth quarter completely reversed, leading the market to be oversold at a technical level, and both long and short indexes were at low levels. JPMorgan Chase believes that this situation provides the possibility for a short-term breather in the market, but expects that the market's stabilization trend is unlikely to last long. The bank predicts that in the second and third quarters, economic activity will slow down again, trade uncertainty will intensify, and serious inflationary pressures will dominate, pushing down stock prices and bond yields, and shifting the market towards defensive sectors. From a macro perspective, the bank's basic expectation for this year is that the market trend will be different from 2017. The main difference lies in the growth of the S&P 500 index and policy considerations. In 2017, the S&P 500 index rose continuously by over 20%, while this year the bank expects the market to be in a consolidation phase at least in the first half of the year. On one hand, the starting positions of the market are completely opposite. In November 2024, investors were at near high levels after a period of "fear of missing out" (FOMO) sentiment, while in November 2016, investors were extremely cautious, with low positions. In November 2016, the P/E ratio of the S&P 500 index was 17 times, while now it is 21 times. The growth prospects, inflation, and bond yield backgrounds are also different. 2017 can be seen as a re-inflation period, while the bank now faces stagflation risks: economic activity gradually declining while inflation expectations rise. The fiscal deficit levels are also significantly different, and the key is that policy sequencing is also diverging. Another difference is the leadership position of the tech stocks. In 2017, the "Mag-7" rose by 45%, with a starting valuation of 20 times. This year, the "Mag-7" dropped by 12%, with a P/E ratio of 27 times. The bank is still not optimistic about the group's performance in 2025. Finally, the policy focus is in stark contrast to 2017. Although this week's major event dynamics may not create too much pressure, trade uncertainty has not yet peaked. In 2017, the market implemented supportive policies, followed by tariff measures in 2018. This time, trade uncertainty is leading, and if companies have to concede and start moving production to the US, this uncertainty may last longer. In order to achieve this goal, the current US government cannot actually let companies see through its bluff of tariff threats. Even if future tariff announcements are subsequently withdrawn, the impact on business confidence may still persist. The main similarity is that international markets may perform better than the US market, just like in 2017. The starting multiples in international markets are lower, and fiscal policies in Europe and China are increasingly supportive compared to the US. Importantly, the US dollar may weaken, similar to 2017. Real interest rate differentials may narrow, meaning the US dollar may further depreciate in the future. However, the bank does not believe that the market will experience directional decoupling. If the market faces pressure in the coming months due to the difficult balance between growth and policies, international stock markets will also be limited, but in periods of market volatility, they may not need to show high beta values compared to the US stock market as in the past.
01/04/2025

"April 2nd" is approaching, and AI leader Palantir (PLTR.US) has been targeted by Morgan Stanley: Beware of the "Davis double kill"

As of the closing of the US stock market on March 31st, the stock price of the "AI bull stock" Palantir (PLTR.US), which had risen by as much as 340% in 2024, continued its soft trend since February. Investors are pricing in the potential impact of US President Trump's global tariff policy on the economy on April 2nd and the impact of the tariff policy on this "AI + big data analytics" company on April 2nd. Compared to its stunning global stock performance in 2024, Palantir's stock has only risen by 11% since 2025, but significantly outperformed the S&P 500 and Nasdaq 100 indices, mainly because some investors still have high hopes for the optimistic revenue prospects that the company could bring with its powerful data analytics ecosystem. However, the analysis team from the Wall Street financial giant Morgan Stanley pointed out that the higher tariffs planned by the Trump administration, which it is set to announce on April 2nd, could lead to an economic recession in the US. Looking at the pricing curve of Palantir's stock and its high valuation dynamics which remain at historical highs, the stock has not made adequate preparations to cope with economic downturn. Since returning to the White House in January, the Trump-led US government has imposed new tariffs on several important US trade partners, and plans to announce so-called "reciprocal tariffs" on April 2nd, as well as potential tariff details for certain specific industries. The Trump administration has named April 2nd as "Liberation Day". Amid escalating global trade tensions, bullish risk assets have recently faced multiple negative impacts: a sharp drop in confidence among US businesses and consumers, a significant increase in the inflation indicators most favored by the Federal Reserve (coinciding with the eve of "Liberation Day" with reciprocal tariffs on April 2nd), and US consumers' long-term inflation expectations being the highest since February 1993. With all these factors putting pressure on the market, the expectation of the US economy falling into "stagflation" or even deep recession has been gaining momentum since February. Under the continuous high inflation and the dual pressure brought by the threats of "reciprocal tariffs" on April 2nd, the S&P 500 and the Nasdaq Composite Index recorded their largest quarterly declines in nearly three years in the first quarter of this year, while safe-haven assets have outperformed. Gold prices rose by 19% in the first quarter, marking the strongest quarterly gain in 38 years. With the sharp turn towards aggressive policies such as imposing tariffs and expelling immigrants, which have led to a comprehensive deterioration of economic data including inflation and consumer confidence, the Trump administration has even refused to provide support to the declining US stock market. This has caused the long-standing strategy of "buying on dips" in the stock market to collapse, leading to massive losses for the billions of retail investors who bought at the lows. According to Morgan Stanley, these macro-level negative factors have played a significant role in the important 30% decline in Palantir's stock price since it reached a 52-week high in February. Additionally, Palantir is an overvalued high beta stock. Morgan Stanley advises investors to remain cautious about Palantir, warning against chasing highs and being aggressive in "buying on dips". The beta value measures a stock's volatility relative to the overall market. With Palantir's current beta value exceeding 1 and approaching 2, it indicates that its volatility is significantly higher than the S&P 500 index, meaning that if the S&P 500 index declines due to deteriorating macroeconomic expectations, Palantir's decline could be more severe. Furthermore, with an expected price-to-earnings ratio of 150x, Palantir seems overvalued compared to the "AI chip leader" NVIDIA Corporation (NVDA.US), which is also trading at a high valuation. Morgan Stanley suggests that these factors, combined, make Palantir's stock less attractive to the majority of institutional and retail investors expecting to buy on dips in times of economic recession as investors tend to avoid overvalued stocks with high beta properties in difficult economic periods. More importantly, Palantir's exposure to government business is too high, and with the Trump administration and Musk-led DOGE massively slashing fiscal spending, the core DRIVE that drives Palantir's performance growth may disappear, which would be a disastrous event for Palantir's highly valued stock. Therefore, in Morgan Stanley's view, the likelihood of Palantir facing a "Davidson double kill" is increasing referring to a continuing downward trend in stock price catalyzed by a simultaneous decline in the stock's fundamental strength and its PE valuation system. However, some investors emphasize that Palantir will maintain its strong growth momentum by penetrating more enterprise customers with its powerful "AI + data analytics" software ecosystem. This is also the core logic behind the bullish outlook for the stock, and the showdown between the bulls and bears may intensify in the future. Regarding whether April 2nd could become a positive catalyst for the US stock market, Morgan Stanley points out that April 2nd may not bring a clear answer for the market, and investors should not see it as a "shoe drop" moment. Faced with multiple variables, the Morgan Stanley analysis team believes that choosing a single path to guide investment strategy is meaningless, and instead recommends waiting for April 2nd to answer two key questions: whether the announcement can clarify the specific path of the tariff policy, turning it from unknown to known; and whether the scale of tariff increases is large enough to further worsen the outlook for the US economy. What is Palantir? What are its heavyweight products in the field of artificial intelligence? Palantir was co-founded by billionaire Peter Thiel in 2003 and has long emphasized its strong relationship with the US government and its allies. The company's software products have been used by almost all important branches of the US military for a long time, and it participates in key military and intelligence operations.The core driving force behind the development of AI projects. This Denver-based American big data software giant has evolved from providing exclusive services to the US intelligence community to establishing long-term partnerships with various government agencies of the US and its allies, as well as with numerous companies such as CBS, General Mills, Inc., Aramark Services, Panasonic North America, and Cummins Inc., making it one of the most influential technology companies in the US.Palantir first gained global fame for providing crucial data and situational analysis support to the US government in the pursuit and killing of Osama bin Laden. Although Palantir never officially acknowledged this, the media and military enthusiasts widely believe that Palantir played an important role in this process, leading to its rise to fame. The American data software giant Palantir, focusing on "AI + data analysis", saw its stock price surge over 340% in 2024. The software giant's stock price benefited from investors' overwhelming enthusiasm for AI, as more and more commercial and government clients began using Palantir's "AI + data analysis" software ecosystem. Palantir's generative AI platform "AIP" is fully integrated with its existing data analysis software ecosystem, allowing customers to access Palantir's core modules and functions through simple Q&A, enabling organizations to effectively apply generative artificial intelligence to data analysis, improving insights and operational efficiency. With its AI-driven data analysis platform, Palantir not only dominates the national security sector but also shows tremendous growth potential in the US commercial market. Palantir's AI software ecosystem covers almost all military departments in the US and has expanded to US allies. With the explosive growth in demand for commercial AI software, Palantir is leading an "AI revolution" dominated by AI software rather than high-performance AI chips. Financial data shows that the company's fourth-quarter sales jumped 36% to $8.275 billion, with US commercial sales growing significantly by 64% to $2.14 billion. In terms of business performance outlook, Palantir expects US commercial sales to grow by approximately 54% to $10.8 billion in 2025. The fatal risk affecting Palantir's stock price trend: excessive exposure to federal government business Morgan Stanley pointed out in its research report that substantial cuts in US federal spending could continue to depress Palantir's valuation and stock price. Morgan Stanley is turning bearish on Palantir not only because of macro factors impacting the stock valuation but also due to the "extremely high fundamental outlook risk" of profit expectations being downgraded. Morgan Stanley stated that what may hinder Palantir's stock from recovering in the coming months is not only the downward pressure on valuation brought by macro factors such as tariffs and broader global trade tensions but also the Trump administration's plan to significantly cut federal spending in the coming years, which could severely impact Palantir's fundamentals. Trump has ordered the Pentagon to identify spending cuts of up to $500 billion, which could significantly damage Palantir's profit expectations, as currently over half of the company's revenue comes from federal government contracts. Statistics show that Palantir is a major contractor for large government software engineering projects, which is no secret. Federal spending accounts for a large portion - approximately $1.2 billion of Palantir's total US revenue in the 2024 fiscal year, meaning it represents about $12 billion of its total revenue of $19 billion. Wall Street analysts generally advise caution with Palantir's stock price, with the consensus rating currently just being "hold" and the average target price at $84.22, which is in line with the current trading price of Palantir stock. This suggests that, according to Wall Street analysts, the stock does not have any upward potential in the next 12 months.
01/04/2025

Growth is expected to outperform the wafer fabrication equipment market. Morgan Stanley upgraded KLA Corporation (KLAC.US) to "overweight".

Morgan Stanley has released a research report, upgrading KLA Corporation (KLAC.US) to a "hold" rating, and raising the target price from $748.00 to $870.00. Morgan Stanley is optimistic about KLA's growth potential in the Wafer Fabrication Equipment (WFE) sector. According to the company's analysis, they expect KLA's performance to outperform the WFE market, with projected revenue growth rates of 8% and 12% for 2025 and 2026, respectively. These data sharply contrast with the WFE market forecast, which predicts a 3% decline in 2025 and a 4% increase in 2026. The company has shown strong revenue growth of 12.15% over the past 12 months, but the current valuation suggests that the stock's trading price may be higher than its fair value. Morgan Stanley's confidence in KLA is based on two main factors. Firstly, the company believes that process control intensity is a key factor, as chip sizes increase and design starts rise, process control intensity is expected to experience structural growth, leading to lower yields and the need for more of KLA's services. Evidence supporting this view can be seen in KLA's share in the capital expenditure of Taiwan Semiconductor Manufacturing Co., Ltd. Sponsored ADR and its growing influence in the memory field. The second driver is that KLA's market share in the area of process control may increase. The bank believes that KLA's position at the forefront of technological change, along with its core technology and data processing capabilities, will enable it to continue gaining market share. These strengths are seen as key factors that will further strengthen KLA's competitive moat in the industry. In addition to Morgan Stanley, Citigroup is also bullish on KLA, having previously released a research report maintaining a "buy" rating on KLA and raising the target price to $910. The reason is that the product development cycle has increased the attachment rate for wafer fabrication equipment. Citigroup analysts have also raised KLA's EPS forecasts for 2025 and 2026 by 13% and 14% respectively.
01/04/2025

Listed and immediately broke! "NVIDIA Corporation's" CoreWeave (CRWV.US) triggers market debate between long and short positions.

Known as the "NVIDIA Corporation's AI infrastructure provider CoreWeave, last Friday, after its $1.5 billion IPO debut in the capital market, it sparked a rare divergence rating from Seeking Alpha analysts. The GPU service provider fell 7.30% on the second day of trading (Monday), closing at $37.08, below the $40 IPO price. Representative Michael Del Monte from the bullish camp gave a "strong buy" rating in an article published on Monday. Del Monte wrote, "Although CoreWeave's performance on the first day was below expectations, the market may have overlooked the growth potential brought by the $11.9 billion framework agreement signed with OpenAI. While there are risks of dependence on Microsoft Corporation and market volatility, the prospects of the OpenAI partnership are enough to support positive expectations." The bearish camp presented a different perspective of doubt. The Value Portfolio analyst issued a "strong sell" rating based on "heavy reliance on major clients such as Microsoft Corporation." Value Portfolio emphasizes that CoreWeave's "AI data center strategy carries significant risks - it requires significant investments to constantly update GPU equipment, and faces the dual pressures of fluctuating AI demand and technological innovation." Analyst James Foord shares a similar view, giving a "sell" rating and pointing out that "the cold reception of this IPO reflects market concerns about the cooling of the AI trend, as well as the issue of excessive reliance on its core partners and high cash burn." Taking a neutral stance, The Value Investor analyst, who gave the stock a "hold" rating, wrote, "CoreWeave relies on NVIDIA Corporation's GPU supply and Microsoft Corporation's (contributing 60% of revenue) business model, combined with the industry's capital-intensive nature. In the competitive and rapidly evolving AI infrastructure field, its complex relationships with stakeholders may pose potential risks." As of the close of trading on Monday, the average rating for CoreWeave on the Seeking Alpha platform was "sell." It is worth noting that Bluesea Research analysts warned last Sunday that CoreWeave's IPO performance would serve as a barometer for the AI industry. Bluesea pointed out that as a company with a 6% stake in NVIDIA Corporation and plans to increase its holdings, if its stock price falls significantly below $40 in the short term, it could trigger a bearish sentiment in the market for NVIDIA Corporation stock. The institution currently maintains a "sell" rating for NVIDIA Corporation.
01/04/2025

AI server orders are expected to increase. Morgan Stanley reiterated their "hold" rating on Dell Technologies, Inc. Class C Technology (DELL.US).

Morgan Stanley recently released a research report, reaffirming its "overweight" rating on Dell Technologies, Inc. Class C technology (DELL.US) with a target price of $128, citing the potential increase in artificial intelligence (AI) server orders from a major Tier 2 cloud service provider. Morgan Stanley analyst Erik Woodring referenced Howard Kao's revised forecast for the shipment volume of the Wiwynn GB200 rack, which increased from around 2500 to 4000 due to increased demand from major enterprise clients in the U.S. As Wiwynn is a major ODM partner of Dell Technologies, Inc. Class C for the GB200, this upward revision is seen as a positive indicator for Dell Technologies, Inc. Class C's 2026 fiscal year AI server backlog orders and revenue. While the specific clients are not clear yet, Morgan Stanley expects an increase in shipment volume in the second quarter of 2025. TipRanks data shows that overall, Wall Street analysts have a "strong buy" rating on Dell Technologies, Inc. Class C technology, with an average target price of $137.36, representing a 51% upside from the current price level.
01/04/2025

Guo Mingchi: Rumors of Apple Inc. (AAPL.US) purchasing NVIDIA Corporation (NVDA.US) GPUs will not bring AI advantages in the short term

There are speculations that Apple Inc. (AAPL.US) plans to spend $1 billion to purchase NVIDIA Corporation's (NVDA.US) GB300 NVL72 product. In response to this, Guo Mingchi, an analyst at Tianfeng International Securities, stated that this will not enhance Apple Inc.'s advantage in the field of artificial intelligence in the "short term." Guo Mingchi pointed out that the order size is "too small" and compared it to Meta Platforms' recent moves. It is expected that Meta will purchase 1.3 million GPUs in 2025, which is approximately 70 times the rumored scale of Apple Inc.'s purchases. Guo Mingchi also added that due to Meta's focus on developing AI servers for large language models, aiming to reduce operational costs and improve service efficiency, Apple Inc. may be lacking in this area. Guo Mingchi explained, "Secondly, the GB300 NVL72 will not begin large-scale shipments until the first half of 2026. Apple Inc.'s suppliers in this regard, Dell Technologies, Inc. Class C and AMD, are not top-tier assemblers like Foxconn or Quanta, so Apple Inc. may not receive server racks until the second or third quarter of 2026, or even later. Obviously, this deal will not bring AI advantages to Apple Inc. in the short term, definitely not within the next 12 months." Apple Inc. and NVIDIA Corporation have not immediately responded to Seeking Alpha's request for comments.
01/04/2025

The imminent imposition of "equal tariffs" in the United States, Morgan Stanley warns: These industries will be the hardest hit.

Morgan Stanley released a research report stating that the upcoming equal tariff policy to be announced on Wednesday may have far-reaching effects on multiple industries, from automobile manufacturers to shoe brands. The report pointed out that analysts expect the United States to impose an additional 10% import tax on goods from China, and to impose tariffs on specific products from Europe and Asia (including Vietnam). The report mentioned that although tariffs on products from Mexico and Canada may eventually be eased, this may instead concentrate the tariff impact on a few specific industries. "While the specific implementation path in terms of tariff levels, product categories, and geographical scope is not yet clear, it is certain that tariff barriers are rising, and companies should be prepared in advance to mitigate the impact," the report stated. Analysts believe that importers of cars, shoes, and clothing face the most severe challenges, as these industries have very limited room to raise prices while maintaining stable demand. Analysts provided specific predictions on the potential impacts each industry may face: Analysts stated that tariffs on cars and parts from Mexico and Canada could lead to prices that are beyond the affordability of most consumers, thus suppressing market demand. Morgan Stanley stated that General Motors Company (GM.US) (26% of vehicles from Mexico) and Ford (F.US) (17% of vehicles from Mexico) may face pressure on profits. Other car manufacturers facing tariff risks include Stellantis (STLA.US), BMW, Mercedes-Benz, Porsche (POAHY.US), and Volkswagen (VWAGY.US). Morgan Stanley stated that potential tariffs on products from Vietnam could impact shoe companies. Data shows that last year, 34% of shoe imports to the US were from Vietnam. Brands like NIKE, Inc. Class B (NKE.US), Allbirds (BIRD.US), On Running (ONON.US), and Skechers U.S.A., Inc. Class A (SKX.US) may be significantly affected. Analysts mentioned that retailers like Academy (ASO.US), Five Below (FIVE.US), Warby Parker (WRBY.US), Wayfair (W.US), and Dollar Tree, Inc. (DLTR.US) face greater adjustment pressures. In comparison, Bath & Body Works (BBWI.US) and Levi Strauss & Co. Class A (LEVI.US) seem relatively independent. The report specifically highlighted that China remains the manufacturing center for technology hardware products such as smartphones, tablets, monitors, and headphones, so the tariff policy may bring operational pressures to retailers like Best Buy Co., Inc. (BBY.US).
01/04/2025
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