This is the difference. Understanding oneself, and structuring the investments to go with their personal situation and mental make up is key. Not everyone has to chase 30% annual return but, when you invest to your situation, I have seen often over the full cycle the returns are not that different.
Congratulations on being clear on your values.
Interest rates are not falling, rather they are steady.
A red hot economy bring red hot inflation, which in turn is going to drive interest rates higher and not lower.
where do you see the Buying opportunity? Because if you are talking about Indexes or equal weighted, they are at ATH or very close to it. Except couple of sectors nothing has sold off.
I think Nvidia is a good example of a buying opportunity. Current price is $185. Has been down to 170.69 recently (in the AI meltdown). High is 212.19. Reports earnings Feb 25, expected to be up 30%.
PE is shown as 45.89, but forward PE estimated as 4x last quarter earnings is 16.
Where can you find a stock growing earning 30% with a PE of 16? Investors clearly expect earnings to collapse. How low can it go? Down another 30% (no price change). PE 11?
The âprosâ selling are clearly idiots. This has to be panic selling triggering stop loss sales.
Makes no sense to me!!
I donât know, but the past cycle turns were much more severe. I have closed my $NVDA position during deepseek, and I donât want to establish a position here. Instead of focusing on $NVDAâs, or even those who buys those chips, I want to focus on the companies that use those chips and can benefit from AI.
Separately, can companies, including hyperscalers run their business for a year without buying anything from $NVDA?
$NVDA is a great growth story, from $5B in revenue, 10 years ago, today TTM $187 B. I understand the technology, how critical it is for the AI ecosystem. However, I wonder how long the firm can continue to grow at 30%, may be they can for another decade, but I donât know. However, if the revenue growth stalls even for a quarter, it will be very painful, the risk of getting into this name at this time is very high. If I am going to buy, that will be when the name seriously sells off. Not at these minor swings.
As a long-term holder Iâve already held through three 40+% drawdowns, so the risks are real (at least in the shorter term).
DB2
I think we expect Nvida markets to mature and growth rate to slow. But major crash seems unlikely. PE 7 for Nvidia?
People who own Nvidia are very unsophisticated. Momentum investors are skittish and can sell as a herd at any time. Smart investors will take advantage.
Nvidia is a well managed industry leader. They have reinvented themselves several times before AI. They have deep pockets. Routinely invest in new opportunities. And probably get requests from dozens of researchers asking for better chips for their favorite application. Many opportunities to innovate. Clearly not a one horse pony.
Roughly 4 years ago the stock plunged by 66%. November 2021 $30. October 2022 $11. Why, exactly, canât it happen again?
Panic selling can happen. But while earning are strong to me that is insanity. Earnings collapse is unlikely. Who would let the PE decline to 1. That is simply unheard of.
These investors are afraid. And extremely unsophisticated. Certainly not fundamentalists.
And if you bought at $11, today you would be up 17x. I bought at $1.54 and am up 122x.
Playing with âhouse moneyâ makes any major selloff far less painful. 
Reminds me the arguments made against Amazon Shareholders!!! Except the sage pundits of âvalue investingâ argued the shareholders are guilliable. Here you are arguing those âunsophisticatedâ will cut and run.
Both are not true.
Let it sink, $4.6T market cap is not held by unsophisticated, ignorant shareholders.
NVDA sales is not dependent on some research projects. The consensus revenue growth is
2026 - 213
2027 - 328
2028 - 418
2029 - 464
This is some serious growth projection. This requires big purchase by hyperscalers, enterprise customers, nation-states, etc.
Like I said, If I owned the stock for few years then I will be inclined to continue to hold it. I am not going to get in at this point.
The best time to plant a tree is 20 years ago. That doesnât mean you shouldnât plant one now.
DB2
I, and many others, bought at $0.45. No analysis or thought required. That was the price when it joined the S&P500 and my index fund automatically got some.
Yep, and the tax bill would be huge. Best to let heirs inherit it. Kind of stuck with it, like it or not. Also big estate taxes likely.
And people have wondered all along at least from before it split if it had peaked and would decline. This is standard Wall Street chatter. So far they have been wrong and those who held have done very well. As always the question is will they continue to grow or not. Winners are still possible.
If someone is bullish on $NVDA hitting these numbers, then they should also make a bearish bet on hyperscalers. These numbers show hyperscalers are going to sustain/ increase their existing heavy cap-ex for the foreseeable future, say 5 years? That means many of them has to be re-rated, their PE has to come down lot more.
What happens if OpenAI is not able to raise money or sumbles? I think it is not $NVDA but OpenAI with all their deals will start the domino effect. At that point, current earnings projections has to be thrown out.
There are folks like Dan Ives arguing every $1 spend on NVDA chips produces 8, 9x multiplier effect, that means $NVDA alone should result in $1 T in GDP, and in 3 years should be 10% of GDPâŚ
I am not saying it may not happen, but the numbers are getting so big and so stretched, and so many things have to align for perfect execution.
But does it? Genuinely asking. If $NVDA is going to hit these numbers, wouldnât it mean that cloud computing and AI were successful commercially at a sufficient scale to justify all that heavy cap-ex? That the âAI jittersâ were for nought, the cloud kept expanding, and it turns out that there was more than enough money to be made in making and selling cloud and AI products to support the higher expenditures?
I donât know. Youâve got maybe a dozen or so hyperscalers out there that make up the bulk of the hyperscale investments. Theyâre not all going to keep going with nine-figure capex investments for several unless thereâs money flowing out of it. NVDA probably canât be as successful as they are projecting unless the hyperscalers are also very successful - successful enough to keep that capex rate so high.
