SPEAKER_02 0:01

Justin, I believe the markets have closed officially.

SPEAKER_01 0:05

I think so. They typically close at four, right?

SPEAKER_02 0:09

That's that's a true statement every day that the markets are open. Yes.

SPEAKER_01 0:15

Unless if you're on Rocket Lead, then it's just always on.

SPEAKER_02 0:18

Yeah, that's true. I mean, the aftermarket just goes straight into the aftermarket. Yeah. I kind of like the the closure aspects of uh the markets closing and reopening and not trading in the after after hours.

SPEAKER_01 0:32

Yeah, provide some sanity, but it seems like that's going away within the next couple of years. Um okay, so let's let's just do an overview of what we're talking about today. Uh you sold a stock that you've been selling like I think every week for the past few weeks. So we'll get into that. There's only been a couple of days I haven't sold, yeah. Um I bought a stock, which we kind of touched on last episode, but we'll touch on it on it again this episode. Uh Rivian released their R2 configurator. So we'll do a walkthrough of that. Of course, we got to talk about Micron. We got to talk about the Nvidia earnings.

SPEAKER_02 1:14

Um everything is revolving around Nvidia earnings today. So that that would be interesting. And I wonder when uh yeah, we'll we'll have to keep an eye on when it comes out.

SPEAKER_01 1:25

Yeah, we'll have we'll have to keep an eye on it. Um, and there's a new, I want to call to kind of say it's a product announcement, but it's not really a new product announcement from you. Um a little side project. So we're gonna we're gonna touch on that as well towards the end of the episode. And as always, we're gonna have listener questions. And I want to call out that this is episode 40, which just feels like a very big number. Um, yeah, so that's all I have to say about that.

unknown 1:53

Okay.

SPEAKER_02 1:54

All right, where should we start?

SPEAKER_01 1:56

Let's start with uh the most exciting update, which is you made a sale. What did you sell and why?

SPEAKER_02 2:06

I I've been trimming my Rocket Lab position. I love this company. I've said that before, but there's probably not much more to say about it, other than you know, at 110 times revenues, it's uh it's now priced for uh a lot of uh the future. So, you know, I've been trimming my position. It's still my second largest holding, so you know you know it's not like I'm exiting this position, but I have been trimming. I expect to continue to trim at these prices or as it uh makes new highs. Um, because the the risk factor is higher for it since uh since it's now trading at such a high high price point. So uh yeah. Uh I just have you any more uh Rocket Lab or are you holding on?

SPEAKER_01 2:47

I just did that one trim. My my plan, which is always a loose plan, is I'm gonna I'm gonna well, one, I'll see how the stock moves. Obviously, if there's a larger jump, that'll probably encourage me to sell more. Um, but I'm just interested to see how Rocket Lab moves as we get closer to the SpaceX IPO. Um I mean it's a double-edged sword.

SPEAKER_02 3:12

It's hard to predict these things. Um it's a double-edged sword because uh clearly SpaceX is going to IPO. It's going to be the largest IPO in history. Um, and when it IPOs, SpaceX might go up from there, uh, but it's also IPOing at roughly $2 trillion uh market cap. And you know, what when we get to see the sort of financial details of the company, there might be a lot of disappointment as well, uh, or a lot a lot of scrutiny. Like, should a company that has, I don't know, somewhere between 20 and 30 billion dollars of revenue be worth you know two trillion dollars? And that that has been sort of like an unprecedented thing, right? Uh, and um all of those things could potentially also drag down SpaceX post-IPO. We don't know. Um, so that in itself, let's put that aside for a moment. People who are interested in Rocket Lab today might be like, well, you know what, I'd rather own the number one. So it could, you know, like it could go that direction as well. Um, so there's like multiple risks uh in that in that sense. But also people could be like excited about space as a whole. And Rocket Lab is the second best company after SpaceX. And if you want to sort of own the basket, Rocket Lab is sort of one that is a much smaller company that you could buy into that uh that has tremendous potential uh and upside in the future. So uh all of those outcomes are a possibility, but you know what uh what in my case, since I've been buying it since the company was about a $2.5 billion valuation, now it's at an $80 billion valuation. It makes sense to de-risk somewhat and um you know hold on to some and see what happens and go for the ride.

SPEAKER_01 4:56

But another angle for the uh the risk factors is a flight risk, pun intended. Of there's a cohort of Rocket Lab shareholders that own Rocket Lab because they wanted to own SpaceX. And now that SpaceX IPOs, there's a chance that you actually have a decent amount of Rocket Lab sellers because they want to buy into that um SpaceX IPO. On the flip side, what could happen, and this is obviously all speculation, is if SpaceX IPOs and its valuation is astronomical, where it has a crazy PS ratio, crazier than Rocket Lab, all of a sudden Rocket Lab looks cheap relative to SpaceX. And that could cause the more people to buy into Rocket Lab and then the price go up there. So it's really hard to know what's going to happen. For me, I'm interested in the pre-IPO movement for Rocket Lab, the the post-IPO, to your point, who who knows what's gonna possibly happen there. Um I I would expect to take more profit before SpaceX IPOs, but um, we'll say.

SPEAKER_02 6:10

And and also one thing to keep in mind is because uh the revenue numbers for Rocket Lab are are a lot smaller, they're they're just approaching a billion dollars of revenue uh on an annualized basis. They haven't even crossed the billion dollar mark yet. Uh, but it's a lot easier to 10x a billion dollars than it is to 10x two 20 billion dollars, right? So uh SpaceX uh to 10x its revenues has to go from 20 something billion to over 200 billion. Not impossible, but doable, um, but but much more difficult to do than going from 1 billion annualized to 10 billion annualized. So uh Rocket Lab's uh growth uh percentage could potentially be a lot faster for a lot longer and be able to sustain that. So you know, if they if SpaceX and Rocket Lab at an equal weighing of like price-sales ratio, I would way prefer to own uh Rocket Lab than SpaceX. And historically, I've had the chance to own SpaceX in the private markets, and I've chosen against it because Rocket Lab was, in my view, a much better deal. So uh it's it's been a it's been a great ride to see.

SPEAKER_01 7:23

Um part of me thinks Rocket Lab is moving so much because it's just trying to regain that number one position in your portfolio since Micron has stolen the seat.

SPEAKER_02 7:35

That's right. That's right. And to be fair, if I had not trimmed it, I think it would have the number one position because uh it's it's gone up a lot in the past.

SPEAKER_01 7:43

Uh well, you should keep trimming it then, because then it's just gonna keep going up uh based on that theory. Um so speaking of Micron, what you haven't taken any profit, and the stock has gone up tremendously since you bought it. It's also gone down since its highs of around $800 a share. I think right now it's $730 a share. Um what what are your thoughts about um taking profit? When what price target do you have, if any?

SPEAKER_02 8:14

Well, today I posted on X that I I finally decided I'm not gonna take it, I'm not gonna sell a single share of Micron under $1,000 until we know more. And most likely uh we won't know more until the quarterly report. Um, so uh you know, there has basically been not much news since the last uh quarterly report where they sort of upped everything. Um, Micron's CEO was on a conference uh in a conference uh just yesterday or maybe the day before, uh, where he reiterated that their numbers are looking fantastic for this quarter and their financials are even better than the expectations that they set out. So that is one piece of information that has come out since then. And um and you know, everyone sort of like fully expects this quarter to be phenomenal. And uh, you know, like there's in my view, uh it would be short-sighted for me to sell any shares prior to the quarterly report, unless it goes over a thousand dollars. I'm sort of like reserving that thousand dollar price mark as you know, I might trim a little bit at a thousand dollars a share. But um, if it doesn't reach a thousand, then I'm just gonna wait for the quarterly report and see what happens uh and and roll the dice there. But um, my expectation is that the quarterly report is gonna be fantastic and they're gonna reiterate uh what a great quarter they've had. Uh also Nvidia's report today might give us a lot of insight on memory demand. And uh Jensen usually comments about memory. He just recently, within the past week, has uh, along with Michael Dell, commented about how uh memory continues to be a constraint and that Micron has done a great job based on a conversation that they had years ago in preparing for the growth of memory demand, and he sees the memory demand continuing for the next 10 years. This is Jensen speaking, by the way, then the one person who knows the most about the demand on AI and uh AI chips, um, obviously, and video chips, but also for memory chips, he speculates that uh the demand will likely continue for the next 10 years. So if this super cycle, as uh we've been calling it uh continues to be going for that for another 10 years, that that would just be an unbelievable amount of growth potential for uh for Micron. So you know, um I like I I don't want to be selling a little too early, but um I suspect that'll happen anyway as I start to trim at some point, just like I have been trimming Rocket Lab for the past year, and it's always been too early since it's making new highs every day. But at least uh, you know, trimming for de-risking purposes is better than trimming thinking that something is overvalued.

SPEAKER_01 11:03

Right. Um, I will say obviously Jensen is very much in the thick of it, but I I don't hold his comments with a lot of weight just because he's gonna be fairly biased. I don't think he would say, you know, memory demand's gonna be weak, because then that would mean AI demand and uh demand for you know NVIDIA GPUs would be weak.

SPEAKER_02 11:25

Not necessarily. He could have said, for example, that um we we expect uh to make a lot of progress on um on utilizing memory better, and therefore hopefully the the part the other parts that we need for selling more NVIDIA GPUs are going to be uh more accessible as uh uh as you know, micron bearings on new plants or whatever. But like he did not say that. He's like he's like, no, the demand is gonna continue to be ridiculous, and um we're basically gonna be trying to jump from one thing to another in terms in terms of solving the demand problem uh as we go into a world where we have billions of agents, uh AI agents working on our behalf. Um sticking on the uh micron topic for a moment, by the way. Um you know, I gotta give this guy, the Citigroup uh analyst, a little bit of uh additional uh trouble because uh or hard time because um if you remember, it was who was it, uh Anik Malik or something like that? I'm calling him up. Are you okay? There we go. Uh Atif Malik. Yeah, thank you. He um had lowered his target, uh price target on Micron after their stellar quarter. This is you know, within days after the last quarter, where they crushed all the estimates and then raised guidance beyond anything that anyone expected, he lowered his price target from $510 to $425. And he did that literally less than 50 days ago on March 31st or something like that. And yesterday, he raised he almost doubled his price target from $425 to $840. Now, what has happened in the past 50 days? Nothing. Micron hasn't reported a new earnings. Uh, you know, there has been like basically no additional news or information that has been provided. Uh, and he just went from lowering his price target by 20% to doubling it, increasing it by 100%. And what happened is price was going down before when he lowered it, price has gone up since he lowered it. Now he's raising it. So uh how ironic. Uh, so you know, in my in my standard sort of uh uh criticism of analysts is that like they're they they're amazing at looking at the rear view mirror, they're hardly ever very good at at predicting the future. So uh that was fascinating.

SPEAKER_01 13:56

Um yeah, it's funny. Okay, let's go to a purchase I made this week. Um, I think it was yesterday. Uh I bought 70% more Rivian shares at $12.69 a share. That was great timing. And and Rivian went up 5% today, right? It was also the low of yesterday. It was crazy timing.

SPEAKER_02 14:22

How did you time that? That that's really, really good.

SPEAKER_01 14:25

Uh uh mostly luck. Um, so we talked about this, and here's the um Rivian chart for the last six months. We talked about this uh last episode because we had a listener question ask if I was gonna buy Rivian at these levels. And I said I have a price target. Um, and I don't know if I'm being stubborn or not with just waiting for it. I don't remember if I said the price target, but it was $12.90, was what I was looking for. And um back in February, it went down to like $13.60. And I was kicking myself because after it did that, it shot up to $17.70. I was like, uh, we should have bought like and this is an example of like when you know, waiting for a specific price target just does not work well. With that said, I already had a big Rivian position and I was not like uh I did I didn't need to buy more Rivian, you know, like if if it I was starting a position, I wouldn't be as strict. Um but I you know I whatever. I decided to be stubborn and it happened to pay off now, you know, like again, I was kicking myself in February, but in May, um it actually went down lower than 1290. I got I I don't set up um automatic uh buys and sells, I set up just a price alert so then I could just assess before I do anything. So by the time I saw the alert, the stock happened to be down to like 1270, um, which is when I bought it. So that that was total luck. But this is an example, and I know you don't like to hear it, where some basic technical analysis can help identify where there might be some opportunities. Um so that that's but uh but it is luck. It's not it's not, you know, facts.

SPEAKER_02 16:21

Right, right. Um I I was actually tempted to add to my Rivian position as well yesterday. Today today I just looked up the price. It did end the um they up six and a half percent. So that was great timing on your part. But um, yeah, Rivian continues to be a phenomenal story where the stock price, in my view, does not match the story of the company. The the company, by the way, they just released their uh R2 configurator, which is pretty sweet. I don't know if have you played around with this thing yet?

SPEAKER_01 16:53

I played around with it a little bit, you know, just daydreaming uh which version I could potentially get. Um what what are what would be your um R2 configuration?

SPEAKER_02 17:07

So so just you know, like looking at the uh R2 configurator here, the the performance model, which is the 57990, which they're releasing this um uh this screen. So essentially this month or next month, they're gonna start deliveries on this thing, um, is the is the one that I would definitely go with. Uh it includes the launch package, which includes Autonomy Plus, the uh a key fob, which these days, because your phone is your key, is like not as important, but it's nice to have. Uh the tow package, and then um uh the all-wheel drive is obviously included, and it includes this sort of like uh Esker silver paint. If you want a different paint color, that's going to cost more. So I I mean I don't mind this paint color, but I would probably go with the half moon gray. I think this is sort of like a nicer paint color.

SPEAKER_01 17:58

Yeah, that's nice. I would I would do the blue or the green. I think the blue is called the yeah, Catalina Cove. Yeah, but I I like to call it Savvy Blue personally.

SPEAKER_02 18:09

That's I like that. Um, but yeah, they they've done a great job with this uh configurator too. And I love the wheels, the standard wheels that it comes with. I would not change the wheels. Um, it also lowers the uh range from 330 miles to 307 if you okay.

SPEAKER_01 18:28

I didn't notice that because I was looking at the uh premium package, and that has different wheel options.

SPEAKER_02 18:36

Um, okay. Yeah.

SPEAKER_01 18:39

And it has different standard wheels.

SPEAKER_02 18:41

Yeah, and then I would prefer the light interior, but it's not available at launch. It says coming late 2026. So I'd probably just go with the black interior um just so that uh you know I'd get it sooner. But the light interior looks super sharp and again, so it's really nice, but also it makes such a big difference on a hot day.

SPEAKER_01 19:01

And I mean you're from Arizona, you know. Um, like it's the car just dramatically is um, you know, not as hot. And you said Autonomy Plus is included. Typically, that costs 2500.

SPEAKER_02 19:15

2500. So they're including it for the with the launch edition. They said I believe for a limited amount of time. So not sure for how long, but basically, the Autonomy Plus includes all of their autonomy capabilities, and as it improves, it's included. Uh, and for the life of the car. So you you don't have to pay a monthly subscription. So you can choose to pay a monthly subscription at 50 bucks a month, too, if you buy a different edition than the launch edition. Got it. So that's awesome. In my view, the launch edition is the one to go with. It also has like Porsche level acceleration, so you're going zero to sixty three and a half seconds. I mean, it's just a phenomenal car in terms of performance and range and capabilities. And you can also take it off-road and you can have five passengers and you know, beat a Porsche 9-11 at a red light, right? It's just like how much better than that can it get? So I I love the potential of this company. So this company just keeps getting better and its stock price just keeps going lower.

unknown 20:17

Yeah.

SPEAKER_01 20:17

I mean, that was another reason why I bought yesterday, is it's just I feel like we're at this uh turning point for the company right before the R2s start to deliver, that this just seemed like such a great opportunity. One other thing I wanted to call out about Rivian is they have a price to sales ratio of about three, which seems pretty low uh for a company in this space, but I want to get your thoughts on it.

SPEAKER_02 20:44

Well, it depends what you mean by this space. Uh, if you mean relative to Tesla, yes, it's extremely low. If you by this space, you mean the car industry. The car industry has historically gotten a price to sales ratio of like under one, which which is understandable considering the car industry as a whole is not growing. So you know, Ford's revenues today are roughly what Ford's revenues were 10 years ago, and same with GM. And in fact, it might be slightly lower. Um, but you know, especially inflation adjusted. Whereas uh companies, you know, like uh uh Rivian is expected to grow revenues like 50% year over year. That's just not going to happen for Ford or GM or anything like that. So it makes sense for there to be a premium. Now, that said, um, Rivian's financials are going to get worse before they get better because they're still losing money and uh you know they are not anticipated to be cash flow positive for at least another year, maybe longer. Uh so you know, this company is going to need to either raise more money or um become extremely conservative with it with the way in which it spends. So chances are there will be more. More dilution events that uh that occur. Now, the good news is that it has enough money to get through the next roughly one year. So it's not like urgent where like Lucid, for example, has to raise money like all the time in order for it to survive a few more months. But uh, but it's not like the perfect place that you want to be as a company where you have to raise in the within the next year in order to sort of make it. Um, but as the stock price, if the stock price were to sort of start going up because it starts making deliveries of R2s and the R2 customers become fans, and those fans are like, well, I want to own a piece of this company, then it is possible that the stock price could go up significantly from here. And then as it goes up, it becomes easier and easier to raise more money. And this is exactly you know how Tesla was able to sort of like raise the many billions of dollars that it needed to sort of survive and make it to profitability. So I'm you know optimistic, obviously, that something like that will happen for Rivian.

SPEAKER_01 22:59

Me too.

SPEAKER_02 23:00

Hey guys, yeah, hey Adrian. The voice from nowhere, the the voice in the cloud.

SPEAKER_00 23:08

But I just wanted to jump in here. A couple people are asking um a little bit more about Rivian. So um this person, um you kind of have already been talking about your excitement, but this person wants to know at what point would you question buying more?

SPEAKER_02 23:29

Yeah, so so you know, for everybody, it's their comfort level, right? Like Rivian happens to be my second largest investment only after Micron. It was my largest investment prior to Micron that I've ever made in any company. So it's still the second largest investment I've ever made in any company. And it's actually very close to my micron investment. Now, the price, yes, it's back down to uh just around what I purchased it at. Um, would I add more? Maybe, but you you know, I'm also my portfolio is also at like an all-time high, so uh hovering around all-time highs. So I'm trying to reduce cash, and I'm again gonna have a massive tax bill. So I'm trying to plan for those things. Um, so I might delay purchasing for now and see what happens. Yeah, and and of course, Dustin just bought some Rubian, so feel free to comment on it if you want.

SPEAKER_01 24:23

No, I I I commented with my dollars. Um okay, we do have some breaking news. Uh Nvidia did release their earnings, so let's jump to that. It was a double beat. They beat revenue by over three three percent. They were expecting or analysts were expecting 79 billion dollars, and they it they ended up coming in at around 81 and a half billion dollars. EPS beat by uh over six percent. Analysts were expecting a dollar seventy-six cents, and it came in at a dollar eighty seven cents. Uh, and let's see, and the stock is down roughly two and a half percent after hours. After hours, interesting.

SPEAKER_02 25:10

A double beat is no longer good enough for Nvidia. Um now, granted, the uh the the beats were as a percentage of revenue the and percentage of uh profits were three percent and six percent, which is respectable considering the dollar amounts that we're talking about. So um the NVIDIA just beat revenues by roughly two billion a quarter. If you annualize two billion a quarter, that's like roughly eight billion dollars. So Nvidia just beat revenue numbers by roughly an eight billion dollar sized revenue company. That's an interesting way to sort of like look at it, right? Um you know, if they bought a company that was generating eight billion dollars worth of revenues, uh it would be the equivalent of what they just beat by.

SPEAKER_01 26:05

So it's kind of interesting. Yeah, it's it's massive numbers. It's it's almost hard to wrap your head around how big the numbers are.

SPEAKER_02 26:13

Right. And if you analyze, uh annualize uh what was their uh uh EPS earnings per share? Uh $1.87. $1.87. That means like if you analyze that, assuming zero growth, that's roughly seven and a half dollars of uh annual profits per share. And what's the price point right now? Price point after hours is uh $218. So $218 divided by seven and a half is trading at a PE of roughly $29, right? Like it's it's not an expensive stock. It's pretty impressive. I mean, I don't own any Nvidia, so I have no reason to be sort of trying to pump it or dump it or whatever. Like I basically am just a fan watching from the sidelines, but um, it's not an expensive stock, and it just continues to crush it every quarter. It's amazing.

SPEAKER_01 27:06

Yeah. Um okay, let's go to a little project you've been working on. So I want you to break down obviously what it is, but also how you built it, because I think that's an interesting story as well.

SPEAKER_02 27:25

So okay, so um to give background on this, uh what when I sold my company, I set aside some money for um foundation for nonprofit activities um and nonprofit work. And uh basically uh it's kind of hard to give away money. I mean, you could just sort of like write checks to sort of uh a bunch of charities if you want to, which is kind of what I've been doing because I don't have a lot of time to spend on uh on it. Uh long term, I want to actually do something far more meaningful with how I spend the money for the nonprofit activity for uh from the foundation, from my foundation. Uh, but in the short term, since I don't have time, I kind of like do need to write checks to uh to you know whatever number of charities. And like I don't know which charities to uh to which nonprofits to donate to. Now I do a bunch like a handful of work, but I need to do more because the number keeps growing, by the way, because uh the the foundation's um portfolios also invested in similar stocks to to my stock. So the the number keeps growing. So I have to like donate more every yeah. The problems wait.

SPEAKER_01 28:39

So are sorry, are there rules around like how much you need to sell in the portfolio every year and donate? Or like how does that work?

SPEAKER_02 28:47

Well, you you have to roughly donate five percent of the um foundation's assets uh every year. So so there is uh some aspect of that that um is in play. And there's some things you can do so so so you can get a little bit more time, but fundamentally 5% of the assets of the um foundation have to be donated. But in any case, I'm trying to sort of like find ways to uh make better donations. Uh and um uh you know, one of the things that I came up with is a fun way to potentially make it so that uh the nonprofits that I donate to get a little bit more visibility, but also like anybody can suggest a nonprofit, and based on the votes, um it could it could actually uh roll something up that I wouldn't have even known about. So I created this website called a hundred tiles.com. So here I'll show you the I'll show you the website. So this is the website. So there's uh a hundred tiles available on this website. Anyone can go on here and claim a tile by simply clicking on it. Um and then when you click on a tile, it asks what's the nonprofit that you're sort of like claiming this tile for. Uh, and then you can put in the website address for that nonprofit. Um, and if all hundred tiles get taken up uh in any 24-hour period, I will donate $1,000 to the nonprofit that gets the highest number of votes. And I've been doing this now for I updated the website to be based on these rules about three days ago. Um, so you can sort of see like the daily archives. Uh, so this is the first day after I updated it. There's a um handful of um uh charities that were suggested, like for for charity water or for Golden Grads, or you know, for Pursue It if you want it and so on and so forth. And you can go to each one of these websites, it's kind of cool. So you can kind of discover charities, but we've never we haven't in the past three days anyway, we haven't gotten close to the 100 tiles being um being taken. So I haven't had I haven't donated yet any amount of money. And the idea is that I'll donate a thousand dollars a day to one of the charities that's on one of these tiles every day for up to a hundred days in 2026. So that's a total of a hundred thousand dollars of donations um that that I'll be making. So um if it happens, uh and uh you know, you know, we have one for 100 people listening right now.

SPEAKER_01 31:16

So if everyone just uh entered in a tile, it yeah, today would be your first day.

SPEAKER_02 31:22

You can go suggest literally any nonprofit that you want, as long as they're a 5013C uh organization, they're they qualify. So you you can go on there and suggest a tile. And there's some like cool little animations that happen, by the way. If you if we stay on the homepage, is anyone gonna, you know, uh do a tile? And by the way, the tiles update. Here we go. This one just happened right now for Hunkapai or whatever. And you can draw on your tile, by the way. So um, in real time, it updates it for everyone. It's just a fun little project. Now, to make this website, uh, I uh wanted to sort of learn how to use AI to build websites and or do software development. I've been in software development all my life and I haven't used AI yet. So this was my first project where Claude literally wrote every single line of code for this website. There's a back end, there's server components, there's a database. It's a multi-user app where you know there's socket updates happening. Um, it's just unbelievable, which just made me even more impressed by Anthropic as a company. So uh yeah, it's kind of exciting. Here's another one for Palestine. Um, so there we go. This um hundred tiles.com. If you're interested in promoting your nonprofit or any nonprofit for that matter, it's kind of a fun way to do it.

SPEAKER_01 32:46

It's awesome. Yeah. So when you were building it, did you even look at the code at all?

SPEAKER_02 32:53

No, I've never even looked at the code. You know, there was a number of bugs. I had Claude just like look at the bugs and I described the bugs to it and it would fix the bugs. Um I am so blown away by AI right now, it's not even funny. And I and I built the whole site in like maybe a couple hours a day for over three days, uh, which is even more mind-blowing.

SPEAKER_01 33:15

Um, so yeah. Yeah, and like what boggles my mind is like obviously this is only the beginning, it's only gonna get crazier from here, right? So it's a very exciting and somewhat scary time.

SPEAKER_02 33:32

Yeah, I mean, I'm I I view it as more and more exciting. Like it, I was more scared of it three years ago, and now I'm just like, wow, this can just enable so much more, you know.

SPEAKER_01 33:43

I'm I'm kind of I think it's similar to the internet, where like in theory the positives outweigh the negatives. Um, but there are definitely negatives to it. Right. Um okay, let's get to listener questions. Adrian, what do we have?

SPEAKER_00 34:04

Hey guys.

SPEAKER_01 34:05

Hello.

SPEAKER_00 34:06

We have so many listener questions.

unknown 34:09

Okay.

SPEAKER_00 34:10

Um we'll see what we can do.

SPEAKER_02 34:11

You seem super excited, Adrian.

SPEAKER_00 34:13

Oh, I'm just I'm just so overwhelmed. It's it's just amazing.

SPEAKER_02 34:18

Let's do it.

SPEAKER_00 34:19

I'm I'm also trying to figure out how to answer all of them. So okay.

SPEAKER_02 34:23

Um we have a lot of time today, so hopefully we can we can get through a lot.

SPEAKER_00 34:28

Yeah. Hi, how do you guys react to one of your stocks getting a short squeeze? I'm in tea long term, but today it went up 30%, I believe. That's from Yeah.

SPEAKER_02 34:38

Well, congratulations for being in something that is getting short squeezed. Um for for those who don't know what short squeeze means is that like uh sometimes uh people speculate that a stock is overvalued and they sell it short, meaning they they sell the stock without actually owning it. This is something that I do not think should even be legal, but um, but unfortunately it is, and uh and it creates an oversupply of a stock and causes the stock price to go down temporarily. Um, and what happens is if the stock is, you know, if the company's performance is actually bad and uh you know um the price, the performance of the company goes down, the price of the stock might also go down, and then short people, people who are short the stock can cover their short by buying it and uh and paying back the borrowed share that they have uh they have previously sold. It's just kind of a crazy idea that literally I do not know of any other sort of uh industry that it applies to except for the stock market, would it it blows my mind? But but anyway, a short squeeze happens when the price, the company's performance actually does well and the price of the stock goes up, and uh all of a sudden there's a lot of people who speculated that it should go down. But now, as the stock price goes up, they're kind of short the stock. So they have to buy the stock, causing the stock price to go up even higher. And this sort of like uh cycle continues. And this is exactly what drove the GameStop Fiasco, if you remember. Uh, during the GameStop Fiasco, the short selling had happened to the to the point of more than a hundred percent of the stock was short shorted, meaning like more shares were shorted than there were even available. More shares were borrowed to be sold, supposedly, um, than should have been available to even borrow. So there's all kinds of problems with shorting. Uh, but then as people were trying to cover, the stock price was going up, which was causing more people to be interested in the stock, which was causing the stock to rise to go even higher, which forced short sellers to cover even more. And it caused this sort of you know, uh crazy stock price. And it went, it it literally went up 50 fold in in the course of what like a few months. Yeah. Um, so that that was the extreme case of GameStop. Um, but in you know, I don't know about this company TE, but uh what I would say is that if if it seems overvalued, then you know you might want to consider selling some or significant portion, but you know, obviously that's going to be a personal decision. But um, if it seems still undervalued, maybe the short squeeze is not even enough yet. Who knows? But um, I don't know anything about uh TE in particular to comment about it, though.

SPEAKER_01 37:27

Yeah, I don't know about the dynamics of TE either in regards to like how do you handle a short squeeze? Um, it's very hard, like mentally, because it uh there's an element of greed that sets in of like, well, can it go even higher? Because it's going up so fast, and then all of a sudden it you know goes back down in a lot of cases, not always, but in a lot of cases.

SPEAKER_02 37:50

Also, it's because these things are so non-transparent, meaning you don't know that the reason is because of a short squeeze, right? Like um Rocket Lab went up 30% in one day, also post uh you know, uh uh earnings report. So was that due to a short squeeze? We don't actually know, right? It's all speculation. The following day went up another 10%. So you know, so um it's hard to know, but yeah.

SPEAKER_01 38:17

The the way I would think about it is um in regards to like should you sell or should you keep holding or whatnot, is how what percentage of your portfolio do you want this stock to be? So like if it's 10% of your portfolio right now after the squeeze, but you want it to be 20% of the portfolio, then maybe there's nothing to do here because it's just growing into the position size you want it to be. But if it's 10% of your portfolio and you want it to be 5%, well then maybe it's time to sell half. Um so that's how I would think about it is like what what allocation do you want to give it in your portfolio as opposed to just like looking at the stock price by itself?

SPEAKER_00 38:57

You ready for the next one?

SPEAKER_02 38:58

Just to be clear, this is like not investment advice. We're we're just sort of just what we would do. Yeah, yeah, let's do let's do the next thing. Yeah, yeah.

SPEAKER_00 39:07

Okay, same listener, real quick. Is there a way to see where a country was founded, a company was founded based out of or mainly does business in on earnings?

SPEAKER_02 39:17

Earnings Hub? Uh no, there they're currently that is that information is not available, but Earnings Hub only includes companies that are uh listed on the US markets. So uh most of them are American-based, but some are uh foreign-based. Usually you have to have a pretty significant presence in the US for there to be a listing, though.

SPEAKER_00 39:38

Ready for the next one?

SPEAKER_02 39:39

Let's do it.

SPEAKER_00 39:41

Okay, we kind of just touched on this, but we touched on it before, but here we go. This listener, Hamid, you've mentioned that you invest only in US-based companies, but once SK Hinks and Kyoxia get listed in the US stock market, would you be interested?

SPEAKER_02 39:58

Maybe, but the the the reality is that uh I I love Micron and they're all in the same business, right? Uh actually, I don't know about Kyoxia, but um Micron and SK Heinx are in the same business. And um uh, you know, I've already done my research on on Micron, and uh I I like the CEO, I love, I like the management team, it's executing really well. I'm gonna stick with that with that horse. I'm not into diversification, so you know I don't want to bet on like six different companies in the same space.

SPEAKER_01 40:32

The the other thing to note is just because a company is listed in on the US stock market does not mean it's a United States company. Um, so there are companies that are are listed, like Alibaba's an example that we've talked about, where I know how you have no interest in because it's a Chinese company, not an American company.

SPEAKER_02 40:54

Not only that, but in Alibaba's case, there's a you actually don't own shares in the company. And in typically that's not the case, even if the um uh meaning, when you own shares in the company, you do own a piece of it. In Alibaba's case, you actually don't own a piece of it. You own representation of it in this phantom organization that is made in the Cayman Islands. It's just like this crazy structure when you look into it that like I want to, I don't want to touch with a 10-foot pole. So um, yes, it technically represents the the company, but it's not actually the company that you're owning in Alibaba's shares in particular. So yeah.

SPEAKER_00 41:35

Okay, this is a fun one. Hamid and Dustin, do you have any favorite finance-related movies? Mine will always be 1987's Wall Street.

SPEAKER_02 41:45

Greed is good. I I hate that speech, and I hate that you know, that's uh in the psyche of the uh uh uh American um social environment. Um no, I don't uh I don't have a particular movie that I love. In fact, most finance-related movies frustrate the hell out of me. Oh, I I love the big short. Do you not like it? That was that was interesting. Uh but uh you know, I like I don't like the concept of shorting in general. Like I think that you're betting against a company companies uh doing well, and I like fundamentally don't like that, right? I I agree with you to to fail, but I just thought the movie was great. Yeah, the movie was entertaining, I would say. The big short was entertaining. And then Michael Burry, right? Um he's he he's been basically a failure ever since in terms of predicting the uh the a hundred of the next two, three cycles. Yeah. So if you if you're constantly predicting, oh you know, everything is overvalued, and you're right twice out of a hundred times, uh you know, like how how good are you really? So I think I think it gives him too much credibility, unfortunately. The movie did, and and he doesn't necessarily deserve it, but yeah.

SPEAKER_00 43:12

Um, okay. Have you looked into VCX? I think that's Fundrise Innovation Fund. Um, it allows the secondary market to invest in private companies like Anthropic, OpenAI, and others. It IPO'd at like 24X and is now around 12x. Wondering your thoughts.

SPEAKER_02 43:34

Um, I have not looked into that, but if it IPO'd at 25 times the nav, which is the net asset value, that means it was 24 times roughly overvalued, unless the underlying assets have gone up in value and it hasn't the nav has not been repriced, which is the the nav gets repriced every quarter, if I'm not mistaken. So that could happen, but 24 times is a lot. Um, RVI, which is Robin Hood's uh fund. That is doing the exact same thing is in a similar type of boat. Right now, its nav is uh its price point is roughly two times than the nav. So to me, something like an RBI, just not knowing anything else, uh, would seem much more valuable than a VCX, right? If if VCX is trading at 12 times its net asset value and RVI is trading at uh two to three times its net asset value, RBI seems like a much better potential investment. So um generally speaking, I'm not interested in these. I'd rather bet on individual companies. The reason I own RBI specifically was just to sort of like um dapple with uh with Robin Hood's venture fund and see how that works. And it's been super interesting, actually. But I have no interest in like massively increasing my investment there.

SPEAKER_00 44:59

Are you are you done?

SPEAKER_02 45:00

Yeah, sorry, let's go to that question.

SPEAKER_00 45:04

All right, let's go to this listener. Do you think it's a good idea to buy MUU instead of MU, which is ETF times two?

SPEAKER_01 45:13

Yeah, so it's a leverage uh leverage ETFs is a good question.

SPEAKER_02 45:18

Yeah, I I have never done any of the leverage ETFs personally. Um, you know, it's kind of an interesting uh I I also don't know the technical details of how they work. So if you're 2x leveraged, for example, and the stock price goes down 50%, do you lose 100% of your money? I I don't know if that would be the case, but if you were technically two times leveraged on your own, that would be true. Uh I don't know how that would work for MUU. Uh, and I've never looked into these types of uh ETFs. I personally prefer not to leverage.

unknown 45:54

Yeah.

SPEAKER_01 45:54

What about I also stay away from leverage. I think uh it's very easy to be greedy, which is what I was just talking about with um the short squeeze conversation. And this just plays into that. Um, and I need to maintain a level head. Um, and it's just harder to do that, even though it could be more financially uh lucrative. It's just more of a dangerous mind game for me, at least. Um, so I don't I don't touch the leverage ETFs. Yeah.

SPEAKER_00 46:27

Okay, you next ready for the next one?

SPEAKER_02 46:30

What else we got? Let's do it. Quick update today's questions day since we didn't spend enough time on it last time.

SPEAKER_00 46:36

Yeah. Uh quick update for this listener. Which is your one largest largest holding?

SPEAKER_02 46:42

So fortunately, you don't ever have to ask that question because my portfolio, as uh can be seen here in on Savvy Trader, uh, as well as Dustin's portfolio, are both available um on sabbytrader.com. You can you can subscribe to them and see exactly which um which holding is the more. You're not in the right window, mead. Oh, sorry. If you're showing it. Oh, I was showing it, but I was not on the right window. You're right. So so here's sort of my portfolio. You can see exactly that uh my largest holding right now is Micron, my second largest Rocket Lab, third largest is Cash, fourth largest is Meta, Robinhood, Ribian, Bumble, um, Bitcoin, and RBI. So these these are sort of like all of my holdings. They're up to date. Uh generally, they're up to the minute, meaning I'll make a trade in my brokerage account, and within one minute, uh, I usually update my um savvy trader account. Uh, in fact, usually it's less than a minute. Uh sometimes I load it up in my savvy trader before I even make the trade in my brokerage account, and I hit the button at the same time just so that people can be notified of my trades at the exact moment that I make them. So um, so yeah, at any given time uh you can see my my portfolio and what percentage of my portfolio is in is in what. And you can be notified of any trades. And that's true with Dustin as well.

SPEAKER_01 48:10

Yeah, both of our uh portfolios, there's a link in the description, totally free um to follow. Uh my largest position is Bitcoin. Let me zoom in here. Bitcoin at roughly 35%, and then my largest uh stock position is Rocket Lab at 20%. Um, and then it it dramatically decreases from there where it goes to cash at 10%, uh Rivian at 5%, so on, so on. So very nice.

SPEAKER_00 48:40

Okay. This one's for Hamid. Hi, Hamid, is US market overvalued considering the higher 10-year bond yields?

SPEAKER_02 48:52

Um, it depends on which stock you're referring to. I I don't look at sort of like the well, there's nothing in the in the um main markets that cause me to sort of be extremely concerned about overvaluation. Uh and since I'm sort of focused on the tech sector, uh I always compare it to other sort of like other markets. And today or yesterday, I may have pointed out, for example, that Walmart trades at roughly 50 times earnings. And Google, Apple, Amazon, uh, Meta, um, Nvidia are all trading between 20 and 45 times earnings, and they're all growing, outpacing Walmart's uh growth pace by multiple factors, right? Walmart is growing at roughly 4%. Um, all these tech companies are growing at uh you know 15, 20, 30, 40, 50% or or higher even in Nvidia's case. So um I don't necessarily think that the markets are massively overvalued, but you know, they are nearing or trading at near all-time highs or at all-time highs, depending on the week. And um, you know, there can always be some kind of correction, as we've seen, even in the past couple of years. And those corrections could last a long time or they could they could be short times. Those things are very hard to predict. And from my perspective, I like to have enough cash to be prepared for things going wrong, right? And and that's the way sort of like I deal with it personally. So thanks. Um let's go to the next question.

SPEAKER_00 50:36

Yeah, you ready?

SPEAKER_02 50:38

Let's do it.

SPEAKER_00 50:38

Um this is another one for Hamid. Hey Hamid, are you interested in any digital banks? I think the sector still has a lot of room to go. And one high-risk, high reward company I personally own is Lending Club.

SPEAKER_02 50:52

I haven't looked at that sector in particular, but of course I own Robinhood. It's one of my largest uh you know, one of the uh investments in my portfolio. All of my portfolio investments are relatively uh large since I only have like six companies. Um, but um but Robinhood uh is getting into the banking sector, digital banking sector, and uh uh it hasn't fully released its product to the public yet, but in its beta, it seems to be going really well, and the assets under uh its banking division is growing rapidly. So my bet is on Robinhood in in that sector. So I'm not looking to add a different one.

SPEAKER_01 51:33

So London Club back in the day, I was really uh not as a stock, but as a uh company, I was just very interested in. I don't I think they've pivoted fairly significantly, but it used to be really focused on anyone can provide uh uh a loan to anyone else's. It's kind of like uh democratizing loan. So like you can, you know, make interest on uh you know, someone someone paying off your loan. And you could see uh, you know, different credit ratings and whatnot. Um I just thought it was fascinating as opposed to like you know putting your your money in a savings account or or even in the stock market. Um, but I don't think it ever really took off. And I believe they're they're pivoting more into, and I could be wrong here because I don't follow them too closely now, but I think they're more of a uh uh digital going into the digital banking space. Um but I like what you said because I already own Robin Hood, I'm not too interested in looking at any other companies just because there's gonna be too much overlap. Adrian was put on another one. Yeah.

SPEAKER_00 52:50

Okay. Oh, whoops, we already did this one. Um what about the Trefus team article on Rivian? How software can tenant X Rivian stock? What's your take?

SPEAKER_02 53:03

I haven't seen uh that article, but um, you know, lots of things could 10x Rivian stock. That's the reason why I own it. Um I wouldn't own Rivian if I didn't think it has 10x potential, uh, just to just to be clear, because uh it's a company that is not yet profitable, uh and financially it's uh it's not financially strong. Like, for example, uh like Meta is a very financially strong company, it's extremely profitable and it's sort of like undervalued. Um, but it might not have 10x potential because uh, you know, there's like lots of things going for Meta, and that's the reason I own Meta. In Rivian's case, it's extremely uh undervalued, but it's also sort of like financially not that strong. And um, it's on the verge of this like massive potential growth, which is not going to provide it with um huge cash inflows for at least another couple of years for it to be cash flow positive, maybe even longer than a couple of years. So, so you know, financially it's not that strong, but uh based on all the technologies, based on all of the things that it has built, uh, this company is extremely valuable to almost anyone who would want to do EVs, autonomous driving, um, software-driven vehicles, charging network. I mean, like all of these aspects, assets that Rivian has, they just add up to be like so much more valuable than the company is currently valued, again, in my opinion. And um if you know, uh it would shock me if this company was not 10 times its current valuation in five years. Um, but you know, who knows? I mean, that that's those are the sort of like uh risks as investors that we take. Um, you know, it could also struggle for the next five years. It's sort of like hard, hard to know for sure. But what I do know for sure is that five years ago, this company was worth roughly 10 times its current valuation, and it didn't have any of these things that it has today. Um, it like not nearly as much as it has today. Today, it has 10 times more assets and uh and uh technology, uh, and it's worth one-tenth what it was five years ago. So, you know, I suspect it it has done this sort of like seesaw thing where it went down by 10x, it's gonna go up by 10x, and in between, it has gotten a hundred times better of a company um between those 10 years. So can't wait to go.

SPEAKER_00 55:45

Okay, let's do this. The I think this will be our last question. So let's do it.

SPEAKER_02 55:50

Let's go.

SPEAKER_00 55:50

Have have you looked into Snapchat stock? Snap, um, they might swing into a big profit in Q3 and Q4.

SPEAKER_02 55:59

I have uh largely because uh my my children are in Snap literally all the time. And uh this is one of those companies where uh I had to sort of like look into them just to see like uh you know, if is this the future, what what's going on? And uh the kids are always using it. So um there's definite potential there for this company to be very profitable and a uh great player, and I like the founder, he's still running the company. I think uh uh I forget his name, it starts with an S. Um Spiegel, something something like that. But anyway, what is it? Evan Evans, yes, that's him. Uh so uh Evan, super smart guy. I like I like his attitude, I like his energy. I think uh he's very innovative, obviously. Um, and he's got the attention of like teenagers, so it's like pretty interesting group to get their attention because as they grow, you kind of like keep their attention. Um, so uh super interesting company. I I kind of keep a close eye on them, but they have been unimpressive in terms of actually make delivering profits uh and in terms of uh significant growth. Uh, both of those things have been relatively disappointing. Uh, and therefore I have picked Meta as my uh choice in terms of investment because Zuckerberg has made a cash cow and um growing faster than uh than Snap, despite Snap's innovations as well.

SPEAKER_01 57:32

Yeah, I also because I own Meta, I I compare it to them. Um Evan is great. I think Zuck is a much better founder um and CEO than Evan is. Also, Meta as a business, they have way more uh product depth than Snapchat does. Um I'm not uh even if the and I haven't looked at their their numbers, but even if the numbers are great, like I just don't see Snapchat being around forever.

SPEAKER_02 58:10

Um you know, like teenagers might disagree with you because I I don't think you can try Snapchat.

SPEAKER_01 58:17

Teenagers are gonna grow up. It's it's similar to uh like Facebook has changed dramatically over the last 10 years, right? Like the teenagers that were using Facebook, a lot of them are off Facebook now because they're using Snapchat or they're using Instagram or they're using something else.

SPEAKER_02 58:33

But those teenagers, as they have grown, they they have continued to be using or they continue to be using Facebook and they have more money, and therefore they're spending money on Facebook on the ads that they see in Facebook. You know what I mean? So like if if they continue to do a good job and keep their existing user base as the user base grows and has access to more money, they can monetize better. And I don't know. It's yeah, I think it's a case to be made for Snapchat for sure, but I'm I'm not there yet for absolutely.

SPEAKER_01 59:04

I just think it's a lot of ifs, and I think there's more going against them than for them. Plus, if you just look at the uh ad spend on uh Facebook's products versus Snapchat, it's not even close. Um, obviously that could change, and you could look at that as like, oh, there's a ton of opportunity. Right. Um, I don't know. I I think I think Meta um to me is the much more better and exciting play here.

SPEAKER_02 59:32

Yeah, 100% agreed. Awesome. Should we wrap it up there then? Let's do it. Episode 40 in the books. We did it. Thank you. Yeah, thanks everyone. If and if you liked what you saw, subscribe, you know, do the things, rate us.

SPEAKER_01 59:46

I thought we weren't supposed to say that anymore.

SPEAKER_02 59:48

Well, um, one one thing I would love to see more of is uh comments on um uh on what people think in uh on the podcast. So if you're listening to this on like Apple Podcasts or something, it I'd love to hear your comments on Apple Podcasts. So uh go in there and and rate it and uh you know tell us what you think. Thanks, everyone. Thank you.