SPEAKER_01 0:01

And we're live. Dustin Hay. Hello, hello. Thank you for the drum roll. Wait, um, there's a little bit of echo all of a sudden. I I don't know. Like uh uh Adrian, are you hearing the echo from Dustin as we think there should be. No?

SPEAKER_02 0:22

Oh, wait, I can hear it. Can you go check your mic? Everything everything is set right. All right, all right. Well, we can't. Okay. You sound good. All right.

SPEAKER_01 0:32

Uh, what's our agenda today?

SPEAKER_02 0:33

Great way to start the episode. Every once in a while we do that where we start and we're like, wait, wait, wait, this is an issue. Um, but you know what? That's what happens when we're doing the live. Okay. So for this week, a lot of stuff going on. You had a bunch of transactions. I had no transactions. So we'll talk about yours rather than mine. There's a bunch of earnings uh that were released from last episode to this episode. Rivian, EOS, Bumble is happening sometime during this episode, and of course, SpaceX from yesterday. Uh we're gonna talk Micron as we always do, specifically about their forward PE. And does it make sense? Does it not make sense? Uh and a bunch more. I'll I'll leave it at that. Well, but there's there's some other topics as well, and as always, listener questions. So get in your listener questions now before it's too late.

SPEAKER_01 1:32

Let's do it. Dustin, where should we where should we begin?

SPEAKER_02 1:35

Let's go with your transactions. So I think you bought three uh stocks and sold one. What did you do?

SPEAKER_01 1:45

Yeah, okay. So um as uh I think Meta reported last week as well when we were uh when we were doing the podcast. And um to me, their numbers were fantastic, and meta continues to uh get, you know, the stock continues to underperform despite the performance, the financial performance of the company, uh just killing it. Like they're growing faster than Microsoft, Amazon, Google, you name it, they're growing faster than them uh in terms of the company's hyperscalers in their category. Um, and they're doing that with no AI revenue whatsoever. They're doing that with their sort of like main core businesses, despite being one of the top two or three biggest investors in AI. So their AI business is basically get uh not generating any revenue yet, any meaningful revenue. It's sort of like rounding error when it's under 1% of your overall revenue. Um, and um uh and and I think those investments have incredible value. But after they report it, their stock went down something something like 10%. Uh, just it just continues to get more attractive despite the company becoming stronger. Now, in recent weeks and months, meta um meta just uh uh has been like putting out new um models, LLM models, where they're Muse 1.1 and I think today they may have released uh Muse 1.2. Uh they're releasing coding agents. They're basically starting to catch up on the um on the LLM side of things. Uh and then they're talking about how they're using AI to improve their products and to provide more business solutions to their customers, because their WhatsApp solution is used by millions of businesses. Um, and they're in a great position to market whatever they come out with AI-wise, uh, especially if it's a hit, because they have access to three and a half billion people every single day. So uh the market has decided for whatever reason, which I I never understand the market in the short term. So just to put that out there, but the market in its infinite wisdom has decided that all of Meta's investments in AI is worth either zero or even negative. And the reason I say that, by the way, is because the core businesses of Meta are easily worth as much as the entire valuation of the company. So in my opinion, and and uh because it has a price earnings ratio of roughly 20, in fact, under 20, uh, which is less than the average of the SP 500. So, you know, should this fast-growing tech company that is just printing money, essentially Meta, uh, be worth less than the average SP 500 company? In my opinion, no. And then it has all this investment in AI that no average SP 500 company has that is being valued at zero or negative, depending on how you look at it. So then it just seems like more and more exciting every day. And uh and I want to own more of it. Uh, then uh, you know, that there's Rivian, who is sort of like in a similar board, it just keeps getting better as a company. Last week, I think they reported on Thursday. Uh, and um Rivian also just keeps getting better. I wanted to own more of that. Uh, and then lastly, uh the the Micron uh what I call operating, you know, you know, it's stock price operating in the ridiculous level relative to the amount of revenue and profits that it's expected to generate over the coming years. Um, it just it just makes it what seems like a no-brainer to me. So, you know, it's one of those things where I would kick myself if I just didn't want you know, buy back at least the shares that I sold, and which I already did at a pretty deep discount. Uh, and uh and who knows, I might even buy more if uh if the market continues to be ridiculous in that sense. So those are the three companies, uh, Meta, Ribian, and Micron, that um I continue to be very excited about. And then um, and then uh Robinhood also reported last week, which was a good report, nothing sort of like uh wrong with Robinhood. I still it's still you know a pretty significant chunk of my um portfolio. But from a PE standpoint and uh growth rate standpoint and future potential, I now think that the opportunity might lie more in stocks like Meta on the safer side with less downside, um, maybe even Micron with less downside, uh, and then also with Rivian with more upside, but Rivian still has the sort of risk of um not becoming a profitable company as it's continuing to burn. So it it always has that risk of, you know, like it's not over the hump yet. So so those that that's sort of like the quick take on why I sold or reduced uh my Robin Hood position substantially, uh, and uh bought those other three companies. And technically, I didn't need to reduce anything to buy the the companies, but I wanted to maintain my cash and even increase it a little bit because I do think that at a high level, with you know the market being at near all-time highs, and certainly my portfolio also being at near all-time highs, there is this sort of like higher level of risk that I perceive. Uh, and therefore I don't want to lower my cash position currently, you know. So I want to maintain my cash, but still trade things around a little bit.

SPEAKER_02 7:21

And it looks like your cash position right now is around 22%. Your micron position is about 32%. Um I think that's the largest I've seen um or maybe.

SPEAKER_01 7:35

When I was trimming it, when I was trimming micron, it was in close getting close to 35% before. Um yeah, you know, but uh the the portfolio was also a a little bit larger because it's spent down, I think it's down something like 10% from its highs. So um, so yeah, I mean it it 33% being in a single stock is a little uncomfortable, which is why I don't want to reduce my cash. Right. Yeah, you gotta offset the risk.

SPEAKER_02 8:06

Okay, so going to Rivian, one thing that I clocked, because I don't think this was announced beforehand, they said that they're gonna do another autonomy day later in the year. Um and I think we both felt the last autonomy day before it happened was going to be a catalyst for the stock. How are you feeling about this autonomy day? Do you think it's going to have a large impact? Do you think there's going to be any surprises, or are they just going to kind of be showing off what um we're expecting in regards to um yeah, you know, autonomous driving?

SPEAKER_01 8:43

I think the way to look at any one particular event um for any stock, not just Rivian, is that it's hard to predict what what the stock will do because of that one event, right? Because oftentimes there's some positivity built baked into it. There's people who are speculating that uh it'll fall short of spec expectations and maybe they're selling short. There's sort of like all kinds of variables that are at play that it's hard to predict what's gonna happen in and around the week of the event, let's say. But the way I view it is that the event is going to be another data point on this sort of uh roadmap of whether or not they're gonna achieve uh self-driving technology to the point where people feel comfortable actually buying a Rivian over a Tesla, for example. And or or even if it appears to be in that trajectory, because a lot of people don't want to own the the you know world's most popular EV, right? So uh there is this sort of like uh sentiment that they want another choice, and the R2, Rivian's R2, is one of those choices that is you know gaining a lot of popularity. So if people can be convinced that Rivian can actually uh build a self-driving car, and maybe that comes out as soon as 2027, uh, and as good as you know, Teslas are today, for example, then all of a sudden that is the trigger point that they need for buying more uh of their cars and there might be more reservations. But the biggest catalyst for Rivian that I see is going to be their actual performance, meaning they're they're gonna actually deliver two times as many vehicles this second half of the year as they did last year or the first half of this year, the second half of last year or the first half of this year, either one that you look at. So that is, I think, the biggest, you know, gonna be the biggest catalyst. And based on their uh earnings report, one of the things that RJ said is that they might not start delivering on the other variations of the R2 until uh 2027, which means they're gonna just deliver the launch edition, which is the more expensive roughly $60,000 edition. So the average sell price of each vehicle is also going to be higher and therefore higher revenues, higher margin potential. So all of that is the positive things that I'm looking for for Rivian for the remainder of the year. Uh and I think at some point, you know, up until this point, their revenues haven't really been growing in a substantial way. But if all of a sudden revenues are going at more than 50% year over year, it's gonna be hard to ignore because then you know the the light at the end of the tunnel is going to be a little bit easier to trace and see.

SPEAKER_02 11:29

Yeah. Uh we have a listener that asked, are you going to attend uh this next autonomy day?

SPEAKER_01 11:36

We'll see. I mean, uh, let's see what it is. If the sketch there's no scheduling conflicts, and you know, obviously, if uh if there's no scheduling conflicts and uh we can attend, maybe we can both attend it. Who knows?

SPEAKER_02 11:50

Music to my ears, finally, I got an invitation.

SPEAKER_01 11:53

Um I mean, I I don't know if Rivian will give us an either one of us an invitation for that matter, but what are you talking about?

SPEAKER_02 12:00

RJ's RBFF. Who knows? Maybe after the last interview, he's like, that's it. Yeah, after we showed him that that chart of Rivian losing all that money. Um okay, and then one more question, and then we'll move on to earnings. Uh about Robin Hood. I don't think they mentioned this in the earnings, unless if I missed it. They announced uh Robin Hood Venture Fund 2. Did you see this?

SPEAKER_01 12:26

Um I did know that that was coming, and I don't remember them uh any details in the earnings call. I did listen to the earnings call, but it's quite possible I was distracted when they were talking about it.

SPEAKER_02 12:37

I also listened to the earnings call. I wasn't sure, and I'm you know, I'm doing a thousand things, so there's a chance they brought it up and I didn't hear it, but I don't I don't think they brought it up. Um and it's so it's a different fund than what you own, the Robin Hood Ventures Fund one, where it's smaller companies, companies that you don't necessarily know at all, um, and I believe it's more companies as well. Um, do you have an interest in owning a little bit of this fund similar to the first fund?

SPEAKER_01 13:10

Or no? If if they are investing in earlier stage, I think that would be kind of uh more interesting because I was actually uh I happened to be reviewing RBI uh just the other day because I was surprised that it's sort of like back to its IPO price of like roughly $25. In fact, I I think it may have even been trading just below $25 for a little bit. But uh I was looking at their holdings and you know, it's all these great companies, whether it's Databricks or OpenAI or SpaceX or you know um whatever is in the list of the RBI uh investment group, fantastic companies. Only problem is they invested at the very last, latest stage, which is extremely high valuations. So they're they're probably, for example, down on SpaceX. Um they're not up significantly on OpenAI, at least yet. Uh, you know, so some of these other companies, like Databricks and so on, are getting very lofty valuations. So it's hard to know if they're uh when they go public, if they're gonna get as high of a valuation. You know, similarly, for example, SpaceX is getting a lower valuation than its IPO price today. So um so it does present a little bit of uh risk if they're investing at the very late stages. If they're investing at earlier stages, that might make it a little bit more interesting. And if they are, then I might even invest more in the second fund. But um, I haven't looked at the um uh the details on the second one.

SPEAKER_02 14:35

Yeah, it it's earlier companies. They posted a video on it, like a 12-minute video, um, with Vlad and Shiv. Uh the acting as always is not particularly great, but it was informational. Uh, so might be worth a watch. Okay, I'll do that actually. I don't know. Okay, let's uh get to earnings. So Bumble released their results. Okay. So revenue was a beat, small beat, but a beat. Uh they were analysts were expecting $210 million, $210.38 million dollars. I have to get into the decimals here. Uh, and they delivered $210.53 million dollars. And EPS was a miss of 465%. Expected EPS was 23 cents, and it ended up coming in at a negative 84 cents.

SPEAKER_01 15:28

Which is almost certainly due to um uh what what what is a goodwill write down of goodwill?

SPEAKER_02 15:35

Yes, but the stock. So the bumble was down 4.5 percent today, and then after hours it's down another 5.6 percent. Um, it is currently at $2.88 a share after hours.

SPEAKER_01 15:50

Yeah, not good, right? Like uh at some point you want to start seeing uh positive surprises as opposed to negative. So um yeah, I'm curious to see what the call is gonna be like.

SPEAKER_02 16:07

Yeah, to me, that like we're it's a waiting game for the overhaul product, right? Like, I just don't think then I don't see a reason why the numbers are going to get much better until that new product is released. Because that's what that's where their focus is on. So to me, as long as they're making progress towards that overhaul, that's that's what I'm looking for right now in their you know, longer uh larger story, right?

SPEAKER_01 16:36

Um so the the miss doesn't bother me, but so the details are gonna be in the conference call, basically. But go ahead, we'll finish that.

SPEAKER_02 16:45

Well, uh as you know, I am getting a little weary of them not releasing that many details about this overhaul. Um, so that's what I'm really looking to see. I don't necessarily expect them to release many details just because that seems to be what they've been doing. Um, but that that that is really what I'm looking for uh with these earnings reports from Bumble.

SPEAKER_01 17:08

Yeah. Yeah. I I I think uh I'm I'm with you. I I think uh you know, I want to see that new product. Um, I want to see it sooner rather than later. I mean, the initial expectations were that it would be out by middle of this year. So that has gotten pushed back a little bit to towards the end of the year. Um, back end improvements were supposed to already have happened. So, you know, I'm curious to see what kind of commentary are uh going to be made about that on the call. So we'll see. Yeah.

SPEAKER_02 17:42

Yeah. Um, and to be clear, the reason why I want them to release more details about the product overhaul is so then as an investor, I can judge and you know, assess do I think this is going to work or not? Because right now I'm betting on the team, which I'm very optimistic about, but we need to trust but verify. So I'm not able to verify until they release more information.

SPEAKER_01 18:07

Very cool.

SPEAKER_02 18:09

Um, okay, let's talk about uh SpaceX earnings, which happened uh yesterday.

SPEAKER_01 18:15

Yesterday.

SPEAKER_02 18:17

Um you listened to the call. What were what were your thoughts?

SPEAKER_01 18:21

So SpaceX's earnings uh beat expectations, and I feel like the beat was sort of baked in, meaning people who were doing the math on trying to determine, okay, how much revenue is their data center lease to Anthropic gonna bring in, how much revenue is their lease to data center lease to Google gonna bring in. When you add up those sort of like numbers, a lot of people were already expecting their revenues to be north of 7 billion, uh, along with their sort of existing growth of the um Starlink and and so on, um, existing businesses. So the 13% beat on uh on revenue top line uh was sort of like expected EPS beat was um was pretty substantial, uh 43% beat, but a lot of that is doesn't encapsulate the uh negative cash flow aspect of additional capex investing that uh that SpaceX is doing. So um the beat on EPS is all right, it's good. Um, but the most exciting part of the SpaceX uh earnings call was uh was the discussions that Elon was having about where uh SpaceX is going with Starlink in particular because of the second generation or third generation Starlink satellites that are going to be able to handle 10 times more bandwidth on a per satellite basis. And then what Starship enables them to do, which is to start scaling those satellites at roughly 10 times as many uh as they move forward in the coming years. So they'll be able to provide uh bandwidth more reliably, higher bandwidth to both commercial and residential worldwide. Essentially, Starlink could be the, you know, pick your number one bandwidth provider in any given region. Like, for example, in Phoenix region, Cox is the sort of like uh cable internet provider, uh, except multiply that universally for the entire world, right? Like Starlink could be that company. And and um it's getting closer and closer to being able to provide uh bandwidth worldwide at high speeds, very reliably. Uh, and that that is the I think most exciting part of the story. Um, then a second uh part of the story, which is uh uh what Elon alluded to in on the on the earnings call, uh, which is the data center leases, are also growing so fast that he said that by the end of this year, meaning by the end of 2026, they could be on a run rate of over $100 billion of uh annual revenue, meaning December might exit the month of December. They might SpaceX might exit the month of December with roughly $8 billion of uh monthly rep revenue. Uh and that in itself is pretty accelerated growth. That's not something that I think a lot of people were expecting, considering we're already in August right now. Uh, and then additionally, he uh he said that their internal projections for 2030, and this is the part where, you know, is this Elon or you know what is going on here? Um the uh 2030 number, he said that internally they're expecting over a trillion dollars of revenue uh in 2030, and that's basically in four years. Uh, and that's the part that is uh both super exciting if you believe him, but also you know, like uh you know, that's more revenue than Amazon, you know, like more than any other company in the world currently. So can SpaceX get there from a $30 billion current run rate to a trillion dollar run rate in Four years that just seems A, it would be completely unprecedented, but B, it just seems kind of hard to believe this might be a sort of Elon uh highly optimistic projection that uh that doesn't come true. Uh that would be far more like I would give five to one odds that uh maybe even ten to one odds that uh that that's a pretty safe bet that they will not hit a trillion dollars of revenue by 2030. So so taking that into uh into consideration, then then it's sort of like okay, there's a lot of stuff to be excited about for SpaceX, especially with Starlink growth and data center growth. Uh, and if Elon is right that um uh data center growth is going to just explode in the coming years, then what that means is, and by the way, that he also said that they're gonna exclusively partner with NVIDIA for the for their uh chips, including the chips that they're gonna put on their space data centers. Um so uh this is really good news for NVIDIA, because even if you're not as optimistic as Elon is, uh, but you know, like you're pretty optimistic on AI, um, then that's good for uh NVIDIA. If what Elon says actually does come to fruition and uh becomes true, then again, that's still good for NVIDIA because they're gonna sell a ton of chips. Um, and then uh and then all of this is good for uh Micron, which is the memory provider, because according to Elon, you know, the uh the there the sort of um uh the supply constraint is in memory and the supply of memory is only growing by roughly 20%. This is also numbers given by other people, not just Elon. Uh, but the demand for that memory is growing by roughly 200% per year. So it appears as though memory is going to be supply constraint if SpaceX is going to be this amazing company for at least the next three, four, or five years, right? So so then you know, taking all of that into consideration, then it's like, okay, which one of these companies should we uh should we bet on uh as investors? And you know, I love SpaceX, I love what it's doing, but it's also at a one and a half trillion dollar uh you know market cap. Uh if it grows its revenues to 200 billion but misses you know Elon's trillion dollar target, that's still an incredible growth rate. $200 billion would be incredible. And if it's extremely profitable and makes $30 billion of net profits off of that $200 billion, that would be an absolutely amazing accomplishment. Any company accomplishing that would be just, you know, it would be like bonkers, right? Uh but then if you take that company with $200 billion of revenue and $30 billion of profits and say, what is that company worth? Well, you know, if you give it a multiple uh revenue uh uh price earnings multiple of like 30, then that company is worth roughly a trillion dollars. If you give it a price earnings ratio of 50, that company is worth roughly one and a half trillion. Well, that's how much SpaceX is today. It's it's at one and a half trillion dollars today. So where's the upside uh from an investor uh perspective? Um and and this is where I struggle. Uh, despite loving this company, I struggle to become an investor in it because the upside potential does not appear to be there. Whereas when I think about, okay, if Elon is right, then Nvidia, who's trading at a PE of 20, forward PE of 20, or Micron, who's trading at a forward PE of six, if uh these companies are both way more cash-rich, way more sort of like profits, and they will also have a ton of upside in terms of revenue and profit growth over the coming four or five years, if Elon is correct, because he's buying these chips from them to get to that $200 to a trillion dollars of revenue, $200 billion to a trillion dollars of revenue. So these guys are gonna definitely do really well, and there is definitely upside to them because their PE's is so low. Uh, if there, you know, otherwise they could just buy themselves out uh with a uh few years of um uh of their profits. So um, so you know, all things considered, this is the reason why, like uh despite having a great earnings report um and you know making a very exciting case for the future of SpaceX, I just still can't get excited for SpaceX the stock. And I am invested in these other things because of that.

SPEAKER_02 26:33

So I think when we we had similar feelings because when I was listening to the earnings call, I was also like this company's really cool, right? Like it's like I want to own a piece of it, right?

SPEAKER_01 26:46

Like I generally want to own a piece of cool companies, but it's hard.

SPEAKER_02 26:50

Yeah, and I was texting with a friend and who wants to get into SpaceX. And I'm like, look, non-investment advice. If if you want to invest in a space company, to me, it seems like Rocket Lab is the way to go.

unknown 27:07

Right.

SPEAKER_02 27:08

If you want to invest in an Elon company, it seems like Tesla is the way to go in regards to it being cheaper, relatively.

SPEAKER_01 27:16

Um, actually at this point, SpaceX feels like it has more guaranteed growth uh thanks to the other.

SPEAKER_02 27:25

Well, um I'm also under the assumption that SpaceX is going to acquire Tesla, which may be a bad assumption. But I'm I'm in that world.

SPEAKER_01 27:33

But then even then, I think if I was if if I well, I mean, I currently don't have either Tesla or SpaceX, and I'm a fan of both companies and a customer of both companies, by the way. I use Starlink and uh I use um uh I drive a Tesla every day. So uh ironically, I uh you know, up until this point, I had only considered you know Tesla as a potential investment. Um I wanted to get into SpaceX early on when uh when it was private, but having to go through the sort of um uh special purpose vehicles to invest, and they they raped those investors in a terrible way. Um so I decided not to. But uh, but as a public company right now, SpaceX still seems slightly more advantageous because I think the growth potential, revenue growth potential of SpaceX, at least in the next couple of years, is significantly greater than Tesla's. Because assuming robotaxis even come online in in a sort of like some, you know, you know, some level of scale, the revenues for robotaxis are still going to be minuscule relative to Tesla's revenues. So, you know, they might add one, two, three billion dollars of revenues from robotaxis in the next, you know, 18 months. If they're ex, you know, if they scale it super fast, by the way, that's just assuming a huge successful rollout. But $3 billion of revenue to Tesla is only a 3% increase. So uh, you know, it's it doesn't uh move the yeah.

SPEAKER_02 29:08

I agree. Again, I'm under the assumption these are going to be one company fairly soon. And what I'm looking at is the PS ratio where Tesla's PS ratio is 12, SpaceX's PS ratio is 182.

SPEAKER_01 29:24

Currently, right? But but uh but and it's going to Elon is right. If Elon is right and they Which we pretty much know he's not. No, no, but like the four-month uh time frame, he seems very solid about it. In fact, on the earnings call, now this is Elon talking, but yeah, on the earnings call, he did say if we do nothing, we should earn we should uh end the year with a hundred billion dollar run rate.

SPEAKER_02 29:50

Um look, he's he's absolutely right, he's just wrong about the time frame. Right.

SPEAKER_01 29:57

The problem with with that particular statement is that uh that that might actually get him into hot water, if uh again, because that wasn't like, oh, we hope we speculate, this is a future sort of like uh uh you know, unless something were to go terribly wrong, he is sort of stating that as a projection of the company's revenues. And there's just that's basically four months from now, you know. Like we're we're in August right now. Uh like uh the roadster was gonna be revealed in April. I mean, that's a revenue projection. It's it's like somebody would have to step in and be like CFO steps in and says, you know what? Like that's a forward-looking step. No, no, no. We'll see.

SPEAKER_02 30:43

I'm I I don't think it's unreasonable for it to be correct. I am just judging based on historical patterns.

SPEAKER_01 30:50

Yes, of course, of course. We do have to discount it, but I'm just saying that that that is a like let's say they they end the year with an $80 billion run rate or $75 billion run rate, that still puts it at a trajectory that it'll pass Tesla within a year, like within the next eight months or nine months. So uh you know that that makes it uh potentially worth more than Tesla.

SPEAKER_02 31:17

Sure. But hard hard to know based on the person giving the yeah, the projections.

SPEAKER_01 31:24

It's so unfortunate that we have to discount this guy.

SPEAKER_02 31:26

I mean, as one of the most accomplished uh accomplished people creates balance because he all he also gets the premium. So there's a discount and there's a premium. Um but what I wanted to get to is so you know, if there are and sorry, to your point, if you want to invest in uh the AI hardware data center space, Micron is the way to go there.

SPEAKER_01 31:53

So well, yeah, I mean it's obviously not investment advice, but just but yeah, I mean that's that's what I have chosen to do because um it just seems like the risk is uh significantly lower with a company whose forward PE is estimated to be five or six versus you know 200 or whatever.

SPEAKER_02 32:13

So yeah, my my but my point being, right, like if you ignore the the excitingness of SpaceX, if you actually think about what you're interested in investing in, it's probably there's probably a better opportunity out there. Probably now with that said, why should you invest in SpaceX? Well, if you think Elon can run the best data centers, that that I think is appealing. And we've seen that with Colossus, where what he's been able to do there is amazing. Um, or if you truly want to invest in a company that is doing data centers and you know, shooting rockets into space uh and AI, providing bandwidth. And right, like if that is interesting. And like there is an element of like, you know, uh being in a lot of different industries and being a prominent player in a lot of different industries um is exciting. But I so like I I get that, but for me, I just have pause when I think about why am I why would I want to invest in this company? Is there something else I I can do? Um and by the way, I don't invest solely because of Elon. So that Tesla SpaceX argument has not really come up for me, but I I do think at this point, it's it it is hard to know which one is necessarily the best vehicle, but I I I there's a high likelihood. Um Tesla ends up in SpaceX.

SPEAKER_01 33:56

It's probably also worth noting that there is an Elon risk factor, uh multiple Elon risk factors in investing in either Tesla or SpaceX. And those risk factors include his um ridiculous claims and sayings, and you know, you know, things like money won't matter or trillion dollar estimates, uh, or that you know, we'll build you know billion robots a year type of thing. Those estimates as time passes, as they become more and more uh like you know unlikely that they're gonna happen, or roadster, for example, by 2020, or you know, like million robo taxis by 2019. And um, as those things don't come into fruition, then the haters also increase. And that causes the stock to sort of like fluctuate quite a bit. And it could go down 40, 50, 60 percent and still be overvalued based on his current performance, by the way. So uh uh financial performance. So there's that risk factor. Uh, and then there's the risk factor that something happens to Elon where he like uh leaves the company or is no longer CEO for some reason. Uh and that too would cause the uh I think would cause a significant portion of the value of these companies, both of his companies, to um deteriorate very quickly because so much of that uh valuation is based on what Elon brings to the table uh and the excitement that he generates, that I don't think there is anybody else who who could fill his shoes at uh at those companies. So um so you know, these are pretty big risk factors that some of these other companies, like Micron or Nvidia, I don't think, have, you know, like if Jensen, if something were to happen at Jensen, yes, it would NVIDIA wouldn't be nearly as exciting, but it's at a PE of 20. You know, what are you gonna go buy? Walmart at a PE of 50, you know, like it's just there aren't that many you know, companies that are operating at that level of profitability. And SpaceX and Tesla don't have the profitability aspect of it, which is what makes them more uh risky.

SPEAKER_02 36:00

So um, okay, we gotta keep moving because we are running very behind. Um, I'll do this next one as quickly as possible. So EOS had their earnings this morning. Uh it was a double miss, but it was partially to be expected. In mid-July, they released preliminary uh revenue results and the the results lined up with what they announced today, which was $68 uh million dollars in revenue. Um what was a surprise is that they are tightening their guidance uh for 2026 annual revenue from $300 to $400 million to $300 to $350 million. So tightening really means shortening uh their guidance, which is not great in regards to like I rather them tighten on the upper band than the lower band, but I do appreciate the added transparency here because they didn't have to do this and they would still be in line with uh guidance if they do get in the range of um or hit in the range of 300 to 350 mil uh million dollars.

SPEAKER_01 37:14

So did did their stock take a hit as a result of all that or their stock did take a hit.

SPEAKER_02 37:19

I'm I'm getting to that.

SPEAKER_01 37:21

Oh, okay. Yeah, go for it. Sorry. I'm jumping ahead.

SPEAKER_02 37:25

Uh so given that expected revenue for the year is supposed to be $300 million to $350 million, that would mean if you just cut the expectation in half for the next two quarters, Q3 and Q4, which is a bad assumption, but we're gonna do it anyway. That means the next two quarters, the revenue should be around $87 million to $112 million. I would assume next quarter is gonna be on the lower end of that. So again, this quarter was $68 million, which was a record quarter for them, by the way. And then next quarter will be around $87 million, is my back in the uh napkin math guess. Now, if you go on X and look at what people are saying about EOS, it is overly negative. Um, everyone's claiming this company is dead. To your question, what did the stock do? Uh at the time that I did my little write-up and checked out the stock, it was like middle of the day, it was down about 10%. But for the week, it's been up it's up 24%. So it's not like it did anything, the stock did anything too crazy. With that said, the stock has had a dramatic sell-off um over the last few months. Um, but it's not like it's hitting new lows all of a sudden from this earnings report. Right. Um, and if anything, and I might have a screw loose here, I like all the negativity around EOS. I think that creates a more exciting buying opportunity. But as I've been saying for the last few months now, EOS is definitely um, you know, I'm not I'm not as interested in buying EOS at this point. I I think I probably will not own this company by the end of the year. Either I'm going to sell them to raise cash or for tax loss harvesting. But I'm I'm still just holding them right now. They're just 1% of my portfolio. So it's it's you know, I I don't feel any rush to do anything with them, but I'm not buying, I'm not selling. Um I'm just holding.

SPEAKER_01 39:44

Very cool. I think Sandisc also reported this uh this afternoon, right? Should we cover them real quick? We sure can. Yeah, go for it, Adrian.

SPEAKER_00 39:56

The voice from the sky. I'm going to chime in and say yes, definitely cover sand disc. A lot of people are talking about it. So give the people what they want.

SPEAKER_02 40:06

Okay. We're just puppets, so we we will do that. Okay, here's their results. So revenue was a beat, it was double beat. Revenue was a beat, uh eight and a half percent. The expectation was revenue was gonna be eight point two billion dollars. It came in at just shy of nine billion dollars. EPS was uh 17.5% beat. The expectation was uh roughly $33, and it came in over $39. Um, and the price move, they were down 5.4% today, and now after hours they are down 3.2 percent. Um, but an additional 3.2%. Yeah, an additional 3.2 percent. Thank you. And there's the price move. So they were actually down much more uh initially. Uh the stock dropped to around uh $1,200 uh initially, and now it's back up to over $1,300.

SPEAKER_01 41:06

Both of those beats on uh on revenue and EPS are phenomenal. And if you look at sort of like uh uh sand disk, you know, again, um going forward, look at that revenue growth. That's just absolutely incredible. Uh and scroll to the top, like we have the little uh earnings hub uh info or score. Uh that they're uh at a PE ratio of just under 20 currently and forward PE of like uh roughly eight. And this is another example. This is similar to Micron, that because of its rapid stock price growth over the past year, the company is sort of like uh basically operating behind its current uh stock performance. So sometimes companies uh operate ahead of their current financial performance, like SpaceX or Rocket Lab or you know, like uh exciting companies oftentimes are trading way ahead of their financial performance. But in in the case of Sandisc and Micron, the market is operating behind their financial performance, meaning they're valuing the company as though you know, maybe two quarters behind on their on their financial performance. They're looking at two quarters ago and saying, well, if it could do this amount of profits, then it's sort of like the current valuation is uh roughly justifiable. Um so Sandisk appears to be you know executing uh exceptionally well, growing super rapidly, and uh just continues to be crushing it. And if again, if and this is the sort of like big F, right? If AI continues to be in as much demand as has been, and storage continues to be in as much demand as has been uh or more, uh, then Sandisk should continue to do well uh for the uh at least next several years. If Elon is right, they might do well well into 2030s, right? So uh it does look good, right? It's um it looks really good. Uh not as good as Micron, I have to say. That's what I want to get to.

SPEAKER_02 43:11

So Micron, you had a good tweet from a couple weeks ago about the forward P and Sandest's forward P was uh about eight, nine. Uh Microns, I think right now is at six. At one point it was around five, if I remember correctly. Yeah. Um but yeah, could you just break down Micron's uh forward P for the people?

SPEAKER_01 43:34

Well, I mean the the way to think about it is that you know, you know, like a PE of 20 is roughly a five percent return on investment, right? Like if you if a company were not growing at all, right? Like if you if you if a company was not growing at all and had a price earnings ratio and was able to sort of continue to produce um the same amount of profits and had a price earnings ratio of 20, that would mean they're giving back or generating roughly five percent of the value of the company as profits every year. So it would take roughly 20 years to get your money back, right? That's what a PE of 20 means. In Micron's case, uh they're so profitable or they're expected to be so profitable over the coming year that they could pay they could pay back the entire value of the company in just six years, right? In Sandis' case in nine years. In SpaceX's case, unless they grow their profits or actually start having some, the expected profits that they're expected to have over the next year, it's gonna still take you know something like 200 years to get your get your the value of the company back. Same thing with like Tesla. So some companies are operating at this sort of like in enormous enthusiasm for the growth of the future growth of the company. And then some companies are operating in such a way that nobody believes they're gonna even maintain their existing profitability. Forget about future profitability growth, right? So Micron is one of these companies where the expectation is that the profits are going to go down substantially. Not that they're even going to be able to maintain their profits. Now how much is it expected that their profits are going to go down? Well if you take a look at the S P 500 and sort of like establish that as the baseline, the baseline is roughly a PE, a profit PE ratio of 20. So you know if you just for you know sake of argument use PE of 20 as the baseline, Micron is getting discounted about 70% from from that baseline. So that means if their profits after the next year or you know like were to go down like if they if they actually generate as much profits as is expected for the next year, but then all the cyclical people are right and and then Micron's you know profitability starts to go down. If it goes down as much as 70% that's already baked into the price of the stock today right that's the expectation uh and um and if it goes down less it's sort of like oh there's additional profits we weren't expecting there. And if and of course there's a chance profits will continue to grow as many people in the hyperscaler and data center build-outs are speculating. So the you know uh the risk factor from from my perspective on Micron is actually a lot lower than all of the people who are arguing cyclical, cyclical cyclical um on this sort of broken record type of uh messaging keep implying because so much of that is already assumed that Micron is not going to be as profitable. So as they continue to generate and this is true for Sandisk as well but as they continue to sort of like come out with quarter after quarter um every quarter people are like oh that's not sustainable. Well then the following quarter they go even higher and then they're like oh shit but maybe like two quarters ago was sustainable. So the price sort of is like a couple of quarters behind in in my view. And now that I think about it in in that way it sort of um uh it sort of makes it more understandable as to why is trading where it's at because uh it's still up significantly this year uh and people are still you know giving it the valuation based on you know maybe uh calendar year 2025's uh last quarter quarter of 2025's performance as opposed to uh its most recent quarter and what is projected to be their next quarter. So uh and then they make up stories as to why you know the future earnings will never happen because AI is in a bubble or memory is a commodity and China uh is going to flood the markets and uh algorithm algorithmic efficiency is going to require a lot less memory chips or you know make up your favorite story healing helium will not be available to make chips that's probably the best one so right like I can I can still buy balloons in my local grocery store. If I can buy balloons I guarantee you that micron can get access to helium. So um yeah so you know it's uh it's fascinating to look at it from these other perspectives.

SPEAKER_02 48:24

Um okay we need to keep moving on because we're like at the 50 minute mark and we still have two main topics and listener questions.

SPEAKER_01 48:32

Okay so last week there was big news around Citadel um potentially manipulating the market where they were broadcasting that they expected uh rates from the Federal Reserve to go up which they didn't but that's what they were saying and that uh had made uh at least the AI sector of the market crash a bit um and there's quite a bit there so I did have you heard of uh situational awareness which is the VC firm that I I had briefly heard about uh uh what's the guy's name I forget uh Leopold Ash and Brenner yeah I had briefly heard about him and situational awareness before um it was a highly rep leveraged uh hedge fund which was apparently hedge like uh using four times as much leverage to uh do investments this is like the equivalent of uh of investing four dollars for every one dollar uh of uh capital that you have which when the market is good and things are going up uh means your returns are astronomical because if they simply go up 20% you're returning 100% right or 80% four times as much um if you if they go up 25% you're returning 100% but then if they go down 25% you you go to to zero your like original capital goes to zero. So um uh and you get shut down very quickly at on its way down and uh and I think this is what happened is uh because of the AI stocks getting hammered hard over the course of literally a few weeks part of which was because interest rates were speculated to go up by Citadel this uh this situational awareness um hedge fund basically uh was forced into liquidate liquidation and then guess who bought them it's Citadel i mean like that is just is that coincidence i i don't know what what is that and by the way you know who else was like sell all your AI data center stocks jim cramer last week right like we talked about talked about it on the pod where he literally uh had the this sort of clip that was going super viral that on open sell your ai and data center stocks if you're buying on margin he didn't say if you're using margin don't use margin like you know you should that's not a good idea he was specifically pointing out those things and it and then you have to question is there are these people in cahoots like what what is going on like where's the transparency in all this stuff and does citadel often speculate on interest rates because I hadn't heard their speculations on interest rates until two weeks ago right that suddenly the rumors that uh citadel came out speculating out of nowhere that um they are going to raise interest rates I mean it's just a bunch of stuff that makes you go hmm there might be no you know wrongdoings here but uh when the same name comes up over and over again uh I think Citadel's name and Ken Griffin also came up during the GameStop fiasco and how people couldn't sell their GameStop shares during the whole sort of GameStop fiasco in 2020 like uh or was it 2021 that that all just like reeks of like this is what's wrong with the markets in a way but um yeah what are your it might not be illegal but it certainly feels unethical uh if they're actively trying to uh manipulate the market albeit indirectly um for their own gain uh but like what we were saying I think it was literally last week's episode we were talking we had a whole segment about risk and leverage or it was came from a listener question and we were both saying how we stay away from that.

SPEAKER_02 52:27

Right. And this is exactly why you shouldn't do anything that's going to put you at risk from being totally out of the game right like there shouldn't be anything that's going to bring your portfolio down to zero. It's the same reason why you don't necessarily invest in one stock because one stock could in theory you know uh go to zero but how many stocks do you need to just stay in the game? Two, three probably not 500 but a lot of people do that. Right. Um now the funny thing is or maybe not the funny thing but I didn't I've never heard of situational awareness but I know Leopold uh Aschenbrenner because he's all over the iron uh Twitter space and the reason for that he he owns some iron or situational awareness owns iron and a lot of the iron bulls uh had a theory so his wife is the chief of staff at anthropic and they were connecting dots that because she's the chief of staff at Anthropic that he must know that Anthropic's going to do a deal with iron and that is why he is invested in iron which if that is why you are invested in iron because you think this is going to happen you should not be invested in iron you should think you should only be invested if you believe it's a strong company not that you're connecting all these random dots first and I just so I I saw his face all over I never really like looked into who he was um and by the way his portfolio about 2.9% of it was iron so it's not like it was like his biggest holding or anything but I just thought it was it was funny because like I saw this guy all over all over the place and now I'm seeing him all over the place for a very different reason. Okay let's move on to our last topic and then we're gonna have to go over for some listener questions. All right okay last topic crypto corner my favorite part of the show uh so there was a big hack for uh specific cold storage wallets um call from the brand cold card um which I think we we talked about this a little bit before the show you kind of heard of this yeah um so basically the way these cold storage uh systems work is there's a 24 word seed phrase so it's just 24 random words if you're able to put them together in the correct order you unlock the bitcoin so in theory and they're and they're totally normal words you know it's like cat house cat um but but for those who don't know that the the 24 words might not seem like a lot but it makes the probability I'm getting there I'm getting there don't don't spoil it please don't spoil it we're getting we're getting there um so in theory this 24 word phrase is guessable in theory right you can guess the words in the order but to your point it's very hard all of these cold storage wallets very hard might not like we're getting there we're getting there go ahead please let just let me run all right all right go for it so uh the the the cold storage wallets will generate the 24 words for you it's supposed to be totally random and that is where the issue is with uh the cold card which by the way is not is a popular cold storage wallet but it's not like the most popular by any means um so this was a a sizable hack but it's it wasn't like um like ledger treasure like those are the the bigger um names so that would have been really detrimental uh but anyway the issue with the cold card is the random uh algorithm to to come up with the 24 words was not actually that random uh basically if you knew one of the words you could like if you just pick the first word you could kind of figure out the other 23 um so this this is the part that you'll like Amin so the the difficulty of figuring out the cold card seed phrase or the compromise logic seed phrase is the same difficulty as finding one specific atom like in a molecule an atom in a virus okay again not a computer virus like a little microscopic virus so finding a an atom in a virus a computer can do that in about three hours okay modern computer can do that in three hours for when the C phrase is phrase is truly random it is like finding a single atom in a two billion galaxies within two billion galaxies you need to find a single atom so that is the difference and that and that a computer cannot figure out a quantum computer maybe right so the even though yes you can in theory guess which atom holds this the seed phrase you have to go through two billion galaxies to figure it out that's incredible do you like that I like that anyway pretty good punchline yeah that was pretty good um I I stole it from Twitter.

SPEAKER_01 58:13

It's fine okay so so that's that um bitcoin itself didn't actually react too much in regards to price over the hack which is uh a little surprising to me I thought it would have reacted more um obviously it's very unfortunate that anyone lost their funds and this is like the scary part of self-hosting that there is a lot that go can go wrong but it is very empowering to also be able to hold your own assets with that said let's get to listener questions all right let's do it hey guys hey Adrian hello let's go back to meta guys as meta shareholders what is your opinion about social media age restrictions in Australia europe and possibly other countries and then this person adds and how hard can it hit meta's revenue yeah so that's a great question and as uh as a father of two kids who have had social media since they they were um probably early early teens I would say uh it it's a double-edged sword if like um uh the they learn a lot they connect a lot they um uh they're way more informed because of social media and there is some like obviously negative aspects to it there's a lot of screen time associated with it um so so it's a double-edged sword and I don't have strong opinions one way or the other uh I don't think it's criminal what they're doing like as the you know like some people view meta as the great evil uh I don't view them that way um and I think that uh the uh laws in different countries are probably not going to be super effective in keeping uh people away from social media because uh it's such a uh so being social is such an important uh part of being humans and um being digitally social it it's sort of like part of that same path so um so I suspect it'll have little impact on uh on the companies because I think that the users will just figure out ways around it so that that would be my my uh speculation on it but uh there's there's no way for me to know for sure obviously and by the way it's worth noting that the companies themselves like meaning meta uh itself does uh point to that as a potential risk a future risk for their uh revenue so you should know that going in but but yeah uh Delson what were you gonna add? Yeah it's hard to know how this is going to play out with that said the the revenue they make off the majority of their products is through ads meaning the person on the other end needs to be able to purchase something uh in order for the ad to be successful so I don't think it's going to affect their ad it might affect their user numbers but it's not going to affect their ad revenue as much because you're not gonna be targeting kids um too much for with your ads yeah because you you want to you want to target adults obviously there's ads for kids um but those aren't going to be as lucrative I would assume um in regards to like my stance on the policy I don't think government should get involved here I think it should be on the parents to decide whether their kids should be on social media or not um but that's just me yeah all right let's do another okay this is referring to your position in Micron I think Hamid have you ever had this type of large position in a single stock as uh stocks go up uh that has happened for a couple of them uh historically for me uh actually several uh I can think of Tesla being one of them that that at one point was uh 90% of my portfolio uh as it had skyrocketed but that was before the sale of my company um uh then uh uh it has happened again um where it's been more than a third of my holding uh with Netflix at one point because it skyrocketed so much uh from my purchase price again with uh Robinhood at some point it was about a third of my portfolio uh by the way that's a a third is about where I start to trim and that's approximately where I started trimming with Micron but now I'm like more convinced that Micron is um uh is exceptionally low uh and then I think it happened again with uh Rocket Lab as well most recently but uh I don't know if it exactly hit 30% or not but it was right around there okay here's this one how will a I think it's a typo but how will AI in local computers affect memory and data centers so the the way to think about uh memory is that any AI is going to need memory and and if you're gonna run AI locally uh then you need that memory locally and if you run a local machine that might be utilized only by you and or your family at let's say 10% of the time uh then you're probably gonna need uh way more memory than if that same machine was running in a data center uh that was being utilized at 80% utilization. Uh so in in that scenario if you bring all the data center computers to local computers you're gonna need roughly eight times more um more resources locally because of lower utilization rates right so uh either way like people say well what what is kimmy gonna do because it's like um you can run tokens at one tenth the cost of uh fable or whatever well it doesn't matter you're still gonna need memory to run uh run kimmy and in fact because of the uh lower cost if you happen to use kimmy 10 times more because it costs you you know one fiftieth the price or whatever then now all of a sudden kimmy is gonna need to run somewhere and uh it's gonna need a lot of memory to run uh so either way like that that uh the the need for memory doesn't go away uh your cost for tokens might might be lowered but uh the server cost for memory is going to remain the same or go up because they need more resources to serve you so uh you know my speculation is that memory will continue memory demand will continue to grow to have any okay here's the next one yeah I just want to because we're running late I want to do speed run kind of yeah yeah go for it why micron and not Western digital or sandask or samsung well samsung is a uh South Korean company I live in the US um I don't know anything about uh South Korea or his politics or his stock market I have no idea how uh you know like uh how I have zero pulse on what is going on in South Korea whereas you know living in the US and watching the markets daily in the US I have somewhat of a pulse on the US so um micron doesn't seem significantly more expensive than uh Samsung in particular so uh that's the reason for Micron over Samsung Sandis seems to be a little bit more expensive they're less diversified than Micron micron is significantly larger more device diversified And happens to be at a lower uh price on a PE basis currently. So um uh and and Sandis didn't have the track record as a public company's relatively recent spin-off of Western Digital. And then Western Digital is focused on uh the disk portion of storage portion of uh uh of the formula, which I'm not nearly as excited about as the memory portion.

SPEAKER_00 1:06:25

So okay, let's do another one.

SPEAKER_01 1:06:28

Okay, speed run.

SPEAKER_00 1:06:30

Hi, to both what is your methodology methodology for trimming your position in a stock?

SPEAKER_01 1:06:37

Dustin, you had a perfect three-point method there. I mean, I don't remember it.

SPEAKER_02 1:06:43

Um I made it up on the spot. Um, I do follow it though. I just don't have a written down. Uh so if a if a stock has run up a significant amount, um that is a reason. I'll trim. I I know Hamid was saying, like, you know, when a stock hits around a third of his portfolio, that is a clear sign that maybe no, no, not the the third is not a trigger point for me, but uh oh that's and by uh that's when you stop buying.

SPEAKER_01 1:07:14

Certainly I stop stopped buying, but uh but it might you know a third might also like it's it feels risky to hold a third of your portfolio in one thing, but but yeah, um I think if I remember correctly, your your things were has it run up enough? Uh is there gonna be long-term or short-term? Well, yeah, long-term or short-term capital gains impact. Uh, is it too big of a portion of my portfolio? All of those things sort of like play a factor into it. I think it was like those three things, if I remember correctly. That sounds right. Yeah, that's that sounds about like what I do as well.

SPEAKER_02 1:07:47

Yeah, I was more on that day than today. That's the secret. All right. What else?

SPEAKER_00 1:07:56

Question for Hamid, will you ever give up on Rivian? I know it's early to judge, but the stock has been flat for almost eight quarters. And then we also have another Rivian one that I think goes with it. Why is the market neglecting Rivian? If Ribbon Rivian was owned by Elon, we would have seen the stock price around $40 these days.

SPEAKER_01 1:08:18

So I think that um uh the way I think about it is that uh is the company getting better or not? And that's when I would get uh give up on a company uh or a particular investment, is that when it's not getting better, or at least at the pace that I would hope that uh uh it should be getting better. So uh would I give up on a company? Absolutely. Like um I'm not married to any company. These are investments after all. I prefer to invest in things that I love, but you know, even if even things that I love, companies that I love doesn't make doesn't mean that I'm gonna stay in them just because I I like them. Um so absolutely I would give up on a company if I thought that the company was not improving at the rate at which I would I would hope that it does. Whether or not the stock price moves is irrelevant, in my opinion. And in fact, if the company keeps improving and getting better and better and better, and the stock price has not moved or goes down or goes sometimes in the opposite direction, to me, that makes it even more and more attractive as as the uh this discrepancy grows. So that's the reason I've been adding Rivian, by the way. Over the past two, maybe three years that I've been a Rivian um shareholder. Uh when I got in, I thought the company was pretty good and it was like a very justifiable uh market cap, you know, meaning the value of the company was such that if I could buy the entire company for that market cap, I would. Um and therefore I don't mind owning a piece of it. And over the past three years, the company has gotten significantly better, uh, but the price has remained roughly the same, and therefore I have continued to add more and more to my position. Uh, and uh if if the company just keeps getting better at this rate, I I expect to do the same. So that that's the way in which I I think about it. Now, to the second question, is to like if Elon owned it, he would be able to build up more hype and you know, uh, therefore it would be a higher price. Well, yeah, maybe it would have been a higher price, but then just like SpaceX or Tesla currently, I might not be in them because I think there's too much hype and uh and uh positive uh nature built into the stock price and therefore uh might not be worth owning because if they don't deliver on that hype, then um then it sort of has the opposite effect, meaning like Tesla and SpaceX could could do exceptionally well as legitimate companies. Tesla could grow to $200 billion and you know, $30, $40 billion of profits. Um SpaceX independently could grow to $200 billion and grow to $30, $40 billion of profits. And even then, despite all of that growth, if their stock price was the same, they would still be roughly overpriced relative to the S P 500 from a price earnings ratio perspective. So um it's not always good to have that hype. Uh, I mean, it'd be great if suddenly all that hype were to be built around Rubyan and then you sold out, and then it doesn't matter what the performance is, but fundamentally the performance and earnings of the company is what matters. So I'll I'll I'll take this question as well.

SPEAKER_02 1:11:29

Um, so just to be clear about what you were saying, and I agree with it. You want to invest in a company where we're you want to buy a stock where the company is continuously doing better. That doesn't necessarily mean that the stock price is doing better. The stock price should be correlated to how the company's doing, but that is not always the case, a la Rivian, where the company is very much getting stronger over the last eight quarters, but the stock price has stayed fairly stagnant. Um, in regards to what was the other part of the not the Elon part of the question, uh forgetting the second part.

SPEAKER_00 1:12:07

Will you give up on Rivian?

SPEAKER_02 1:12:09

Thank you. Uh in regards to giving up on Rivian, it's getting this is what happens when we go over. I get tired, I get run down. Um in regards to giving up on Rivian, like Hamid said, you should always be willing to give up on any stock. If I'm buying a stock, my methodology or my mindset is that I'm holding it for the long term. Uh, there's some rare cases where I I'm maybe doing a swing trade. That's different. But for a stock that I'm holding for the long term, I'm not um expecting to sell it, but I am very open to selling it if something were to happen where the the thesis doesn't make sense or the reason doesn't make sense, or maybe there's a better opportunity elsewhere. Um and one last thing I want to comment on just the pattern I've been seeing, and I'm sure a lot of our listeners fall into this, is there with social media, there's been a shift in having a stock become your identity, where it's you know, maybe in your your Twitter handle name, maybe it's in your description. And it's great to be passionate, but it does as an investor, it makes it harder to walk away if it doesn't make sense. Um and I I think that's just something everyone kind of needs to be a little weary about. Um, and not only for how you operate, but how who you follow, right? Like if you're following someone who's very bullish on I don't know, Tesla, are they ever going to walk away from that stock if if that's all they're branding? Probably not. And therefore they might not be the most objective person to um follow. Or you could follow them for fun, but just just know um, you know, they're they're wearing their bias very much in the forefront. So that doesn't happen too too much on social media, unfortunately. Yeah, it's like this new phenomenon, right? Before social media, you didn't really have that. Yeah.

SPEAKER_00 1:14:08

Okay, let's do this last one and then we'll close up.

SPEAKER_01 1:14:11

Okay, what one last one?

SPEAKER_00 1:14:13

We've got so many. Micron technology generates significantly higher revenue than sand disk. Why is the sand disk price higher?

SPEAKER_01 1:14:22

So the price of a stock is no indication of what the company is actually worth. Um, this is uh very unfortunate that um investors, not not all investors uh understand that, but um, there's one other component, which is the number of shares that are outstanding, that you have to multiply that by the price to determine what the company is worth. Uh so that's why the market cap is how you should be looking at any given stock. Um so uh you know, if the price of a stock is uh $3 but they have a billion shares, then the whole market cap of the company is $3 billion. Uh and if the stock price of a company is $3,000, but they only have um, you know, uh uh a million shares, now uh the that company is also worth about three billion dollars. So if they have a half a million shares, that company is worth half as much as the uh the other company. So uh the stock price by itself tells you nothing about what the company is worth. And that's the reason that uh Sandisk is higher. The number of shares outstanding uh is also controlled by the company, meaning companies can do stock splits, they can issue more shares, they do issue more shares regularly to their employees, um, and they can also sell shares to raise money for various different reasons. All of those things affect the shares outstanding, uh, and the market cap is what you should always be looking at. So we'll end it there.

SPEAKER_02 1:15:47

But that we're gonna end it there. My toddler just walked into the house, which means I'm going to get pulled off very quickly.

SPEAKER_01 1:15:54

All right, very cool. So thanks everyone. Thank you. Good episode. Great episode. And if you're listening to listening to us on a podcast uh uh like uh Spotify or Apple Podcasts, we'd love a review and a comment on there. I've heard that helps, so that would be awesome. But we'll say that. Thank you and bye.