Stocks of the Week!

Read time - Fast enough to read during your morning poo (>5 minutes)

In this email:

• Nvidia’s Ugly Sister is Getting A Makeover💅👀

• How’s Buffet Coping without Charlie Munger?😢

• Why China EV Stocks are better than Anywhere Else 🏁🏎️

Nvidia’s Ugly Sister is Getting A Makeover💅👀

AMD has been the ugly sister to Nvidia & Intel for a little while but they might’ve just found their glass slipper 💅 

Q1 brought in $5.5 billion in revenue with a $2.5 billion gross profit.

That's a big fat 52% margin which is great 💰

Net income (the profit left after everything’s been accounted for) was down a little from the previous quarter with a 19% fall.

It's not ideal but it'd be way more concerning if it was just AMD that have taken that kind of hit. Other tech giants have seen a similar squeeze which means we can point the finger to wider market conditions vs blaming AMDs operations. 📉🤷‍♂️

🌟 Now for the STAR of the show🌟 

🎉AMD's data center division! 🎉 

Revenue skyrocketed by 80% to $2.3 billion 🚀 

Their EPYC server processors and Instinct GPU accelerators, can take the credit for that one. And there's rumors of new EPYC CPUs for later in the year which will be like steroids for data centres 💉💪 

And we're not done yet... 

AMD released some shiny new toys late last year to compete with Nvidia's GPUs focused on AI & machine learning.

Since then AMD have raked in over $1 billion with them 🤯 So the revenue target for the product's been upped to $4 billion (previously $3.5)

The Ryzen processors are killing it too with an 85% revenue boost to $1.4 billion. It also moves the product from losses to profits for AMD💰

It’s not been all sunshine & rainbows though 💩

The gaming division’s revenue dropped by half to $900 million. They've done a good job at managing costs but it's a tough time in the gaming market with the current console cycle at its low. 🎮😢 

Q2 projections are for $5.7 billion in revenue, banking on growth in data centers and consumer PCs.

The potential in AI computing and new product launches could make AMD a serious outperformer if everything goes to plan.

From a technical view, they're about 40% down from this years highs & floating around a previous high that could look to be a new support at 148. If that technical level holds & the fundamentals pull through we could cover that gap for a 40% gain.

How’s Buffett Coping without Charlie Munger?😢 

Berkshire Hathaway had their first annual meeting without Charlie Munger…. 😢

So what's the latest?

Berkshire’s operating profits were a record $11.2 billion in Q1, a 39% jump!💰

But, the real question everyone wanted Uncle Buffett answering was “Why have your cut your Apple position by 13%?!” 😮

And to be honest, the answer was underwhelming at best 😴 

His views on Apple haven't changed. They'll still be their largest holding & will continue to be unless something dramatic happens.

No drama, no news story. Just building up the cash pile 💰

Berkshire have closed out their Paramount position & Buffet took full responsibility on the loss for that one 📉 

He gave the nod to Charlie Munger for their green positions in Cost-Co & BYD co and said that Berkshire would be mostly focused on the US stocks, with not so much focus on China and Hong Kong.

Buffett also touched on AI. 🤖💬

Said he didn't know much about it but that it'll be the biggest growth engine for scamming & we might regret letting the genie out the bottle in the same way we do with nuclear weapons 💣

Intense. Sorry I asked 😅 

And let's not forget the buybacks!

Berkshire repurchased $2.6 billion of its stock in Q1 alone. The strategy seems to be exercising some patients & sitting on a bunch of cash. The cash pile is up to $182.3 billion (and counting).

Buffet said they can make decent returns on t-bills right now but even if interest rates were lower he'd still be sitting on the cash because there isn't anything super appealing to him right now. Might have to pump the brakes on buying the market right now & follow Buffets lead...

But should we be buying Berkshire Hathaway?

I’m holding a small position right now.

They’ve cooled off a little from recent highs (down about 5%) so I don’t think it’s worth a technical play. But if they’re sitting on this much cash with record operating profits once they start deploying capital they could see some monstrous gains.

Why China’s EV Stocks are Better than Anywhere Else 🚗

Nio doubled down in April & delivered 15,620 EVs.

That's up 32% from March and it gets better.... It's 135% more than last April 🤯 

Booming growth like that isn't only super impressive, it also puts them ahead of the pack vs their competitors. And investors love that ❤️

Shares are up over 40% since it's lows in April 💰

Nio also rolled out the red carpet for their new 2024 ET7 executive sedan on April 25, with deliveries hitting the road by the end of the month. Plus, they’ve joined forces with Lotus Technology for better tech on EV charging and battery swaps⚡🔋 

So who are the competition they’re beating right now? 🤔 

BYD Co ltd reported its April deliveries at 313,245 vehicles, marking a 49% increase from last year.

Impressive growth just not as impressive as Nio. 😍 

Other corners of the Chinese EV market like Xpeng Inc and Li Auto inc are making moves too, both with higher April deliveries.

So how can we make money from this?

Take a look at this graph 👇

These graphs so how many people answered the question “How likely are you to purchase an electric vehicle?”  with a positive response 👍  

You can see that response rate has flat lined in the US & Europe but skyrocketing in China.

And that’s backed up by the delivery numbers we’ve just seen 👀

So if you believe in the EV movement & want to get behind some fast growing stocks you’re more likely to find them in China’s thriving EV market than anywhere else. 🌎

That’s all! See you same time next week 👋 

P.S Hit reply & let me know what you thought of this weeks newsletter. All feedback is welcomed ❤️