Transcription
Okay, so CRM down 6% here today. So what's going on with CRM? What's my perspective here?
So Salesforce sinking 6% for its worst drop in nearly two years after Anthropic rolled out co-work. Uh, so Claude, they have this Claude uh code for the rest of their work. This was shown off, went pretty viral on X uh last night from what I had seen at that particular time, right? Um, they're talking about this launch lands rate in Salesforce's own agent strategy with Agent Force.
Okay. So, you know, first off, I don't know if you guys have seen it. It's cool. Like, no doubt, right? It's it's great, you know, but my perspective on this in regards to this, right? Is this is not like one company wins everything. Like, oh, you know, Claude launched this new product, so Salesforce is done. They're finished. It's not how this works. Same thing. Salesforce launches some new product, doesn't mean all other companies are irrelevant. They all they're all done. And they're all finished. Like they can't grow. No.
When we're talking about these sorts of services that do what this Claude product does, right? With what Agent Force does, you got to understand like my viewpoint is every major business in the world, but certainly the United States of America, will have these sorts of products in the next three to five years. So like there's not just going to be one company that's going to win the whole market and it's like, whoop, they won. Like, no, no, no. No one's going to get no like everybody's going to need these products and services and there's going to be multiple winners here. And so I think Claude can be successful. I think Salesforce is going to be extremely successful. We're already seeing it in the early numbers uh over the past couple quarters in regards to Agent Force and how that's building. So yeah, like I I don't, you know, it's not it's not like one company wins and everybody else loses. It's just not the way it works, especially in SAS. Like, you know how many successful SAS businesses there are that are, you know, we can talk about um $10 billion plus companies. It's a lot. There's a lot of SAS companies that are $10 billion plus. It's one of the best spaces to be in, right? Um, and then there's so many SAS companies that are, you know, companies that do tens of millions of dollars of revenue a year, hundreds of millions of dollars of revenue a year that you probably never even heard of unless you're, you know, use them for your specific business.
And so, just understand like like the market's going to overreact to every single new product launch in Salesforce. You got to understand this about the stock price, okay? You know, stock price of a stock and how it plays in with a news cycle like this. Okay? Listen, it's very important. When you have a stock like a Salesforce that's clearly weak, like there's no debating that. Look at Salesforce stock price, not the financials. Look at the financials last five years. It's amazing, right? Look at the stock price of the past five years and tell me what you see. Weakness. Look at Salesforce the past year. Tell me what you see. Weakness. The stock price is incredibly weak. So any piece of news that could be seen as negative towards Salesforce causes selling. And it'll be like that until it's not anymore. And what is going to get people out of this, you know, sell first, ask questions later mentality in regards to Salesforce? Salesforce has got to keep coming through with numbers. Keep growing Agent Force specifically. Let people know the numbers. Have the numbers be good and Salesforce stock will rebound just fine and it'll be a huge money maker over the next few years, right? And everybody will look back and be like, "Oh gosh, remember when we were freaking out over every new thing that came out and always viewing it as a negative for Salesforce?" Like, it's just it's crazy, man. It's crazy. But, you know, it is what it is. Um, I think something like this shows, if anything, Salesforce is working in the right direction in regards to all this right now.
That leads us to the next very weak stock, which is Adobe. This stock is just, you know, in terms of the stock price, once again, you've got to you got to understand there's a difference between a stock price and how the company's financials are. Okay? Salesforce and Adobe financials are better than they have ever been by a mile. That's just facts. It's not that's not an opinion. Just look at the numbers. It's better than it's ever been. It's way better than it was three years ago, five years ago, a year ago. Like, just how it is, right? The stock prices are absolute trash in the short term, right? And that's where you can actually find great arbitrage as a long-term investor. If you find a company whose financials continue to get better and the valuation is very attractive and the financials are expected to continue to get better, but yet the stock price is garbage, that's where you find the biggest arbitrage opportunities where you can find like an EL. Like look at EL. I showed you that just a moment ago. 130% gain since that liberation time. I'm now up almost 70% on that. And you know that was a stock that was absolute garbage like, you know, in terms of stock price and then that's a little bit of a different situation because their financials were garbage. Adobe and Salesforce, they don't have that. Uh, those financials are phenomenal, right? Oppenheimer downgrades Adobe to perform as demotions pile up. Oppenheimer is the latest financial firm to downgrade Adobe, uh, rerating the creation software company to perform from outperform. So, not as big of a downgrade. Uh, basically kind of like they still expect the stock to do well, just not like great like an outperform rating would be. We had previously been bullish on Adobe as we expected its AI business momentum to reinvigorate growth in its digital media business, says Oppenheimer Analysts in a detailed investor report on Tuesday. But this did not play out as we expected and is visible with digital media growth decelerating further in fiscal year 2025. In our view, Adobe has good medium-term opportunities and is a cheap stock. However, a challenging operating environment during the AI technology transition leading to uninspiring and decelerating topline growth, inconsistent execution with product cycles, durability concerns about the mode, lackluster investor interest for owning software names. That is true, right? And down year-over-year operating margin guidance in fiscal year 2026 will likely weigh negatively on sentiment for the company's opportunities this year and limit near-term upside. Okay, everything you just laid out there that's already been known, that's already priced into the stock in my personal opinion. It's this is the latest downgrade to hit Adobe last week. And Jeffries downgraded Adobe to market perform or uh to market perform and hold respectively. Uh, that followed key banks downgrading the stock to underweight in mid-December. It also reflects a broader trend of software names not experiencing the same boost as hardware names from the AI boom. I mean, you know, it's just they're just so they're just so bearish on Adobe.
But let's just look at let's just look at what is it going on with Adobe's business model, okay? And let's just try to figure this out, okay? So, what I'm showing you in front of your eyes right now is 1000x stocks.com. This is Adobe's trailing 12-month revenue. This is where we're at right now. This is where we're expected to go. Looks great. This is Adobe's margins. We're talking about net margins around that 30% number. We're talking about gross margins around 90%. You know, that's unbelievable. This is Adobe's earnings per share trend. This is where we're at right now. This is where we're expected to go. This is Adobe's free cash flow. This is where we're at on a trailing month basis. This is free cash flow per share. This is where we're at right now. Okay. This is the historical P ratio for Adobe versus where it's at now. You seeing a trend, cheap stock, financials better than they've ever been. Operating cash flow on a trailing month, this is where we're at. Looks pretty darn good, eh? Operating income, this is where we're at on a trailing 12-month basis. As far as shares outstanding, they keep bringing them down because they're buying back tons of shares right now. Uh, ladies and gentlemen, we have a situation here with Adobe is very, very intriguing. It is very, very intriguing where we have a stock that is trading at historically insanely cheap multiples. We have a financials and a business that looks better than it's ever been. We have a Wall Street community that seems like they couldn't be more negative. So, it seems like at some point in time, and I think it's happening sooner rather than later, I think no matter what you throw at Adobe, it's not going to stick anymore because you already threw so much mud at it, you got no more mud, it's just going to slide right off now. And so, that's the way I view Adobe kind of looking past Q1 is this is a stock that has had so much mud slung on it that it's just not even going to matter anymore, right? Uh, the mud's just going to slide off. And as at the end of the day, as long as you're a company like Adobe or Salesforce and you come through and you just keep putting up your numbers, your stock will reflect that over time. The issue Salesforce and Adobe had in the past and why those were bad stocks that say if you bought them five years ago, look at the P ratios where they were at five years ago. Look at Salesforce P ratio five years ago. Look at Adobe. They were not cheap stocks back then. Now they are. They're extremely attractive, attractively priced. Now, those stocks are priced roughly in line with where the market in general is at or actually undervalued, trading at P ratios under where the market in general trades at, which is crazy for companies that have still really good growth and have margins that these companies have.
So, I look at these two stocks as, in my opinion, easy stocks to buy. Easy. Like, it's just no other way to put it. Like, you know, I think it's just stocks you buy over the next, you know, several months. You hold them for the next two, three years and you look back and be like, "Well, that was good. I made a lot of money on that." Like, "That was pretty easy, right?" Um, sometimes, you know, there's just opportunities out there that are that are, in my opinion, easy opportunities. And I look at Adobe and Salesforce here and I say those stocks are easy opportunities, right? And so, me personally, I will personally be buying more Salesforce stock and more Adobe stock, you know, over the next, I would say, probably two to three months. And, uh, yeah, I mean, you know, I like it.
Next one up here, AMD. So AMD moving up huge. Okay, so what's going on here with AMD? What's my perspective on this? Well, Intel and AMD upgraded to overweight as server CPUs mostly sold out for 2026, Key Bank says. Okay, so let's go straight to the AMD part. Okay. Uh, so AMD, AMD, which has a $270 price target from Key Bank. So quite a bit upside has nearly sold out its server CPUs for the year. It's only like January, right? It's the first half of January at that and they've already likely sold out their server CPUs for the year. Our supply chain checks indicate the I do like when com when analysts actually do supply chain checks. It's kind of like getting information that you and I really couldn't get. Um, so it is actually valuable. Like I always supply chain checks is always actually something that analysts provide that can be, I would say, beneficial. Our supply chain checks indicate the recent surge in hyperscaler demand has led to AMD to almost being completely sold out of server CPUs in 2026 and is potentially considering a price increase of 10 to 15% in the first quarter 2026. We estimate server CPUs for AMD will grow at least, at least 50% this year. This year, ladies and gentlemen. Wow. Keybank believes AMD MI255 and MI455 can support AI related revenues of 14 to 15 billion this year. Regarding AI GPUs, now we're talking GPUs. We're seeing indications of 200,000 MI 355. This is the one they just ramped somewhat recently. Well, I shouldn't say somewhat recently. Actually, it's probably been six months ago now. They started to really ramp 355 GPUs in the first half and significant ramp of MI455 in the second half. This is the huge deal for AMD. This is, you know, 55, 355 was the that was appetizer. 455, this is like the main course and the 500 series that's going to be dessert. Okay. In the second half of which 290,000, a 300,000 is targeted for its rack scale solutions. Helios. Keybank noted it remains unclear how many racks AMD will be able to ship. Similar to Nvidia, we expect AMD um revenue recent uh revenue records significant amounts of MI455 Helios revenue as it sells its components to its um partner ZT Systems, which ZT Systems was owned by AMD. They had bought them, then they kind of sold off the manufacturing part, so but then they kept part of the team. So a little bit of a confusing ordeal in regards to that. Um, is this telling us anything we likely don't know? The answer is no. Like if you're up and up on the AMD story, you like this is not a surprise. Like we expect it. AMD's revenue is going to go insane over the next three years. 26 is a huge boost up year. 27 is going to be even a bigger boost year. And then 28 as well. So this is more just confirmation, right? Or it's giving people Wall Streeters that were not on the up and up in regards to AMD, right? Remember AMD was under $100 during the April drama last year, right? So, Wall Streeters was kind of caught off like Wall Street was so caught up in Nvidia last year, right? That they totally missed AMD. And so, like they didn't understand the AMD story. They're like, "Oh, their numbers are really bad compared to Nvidia." And it's like, "Yeah, they're behind. They were they were two to three years behind Nvidia, but if you saw the products AMD was coming out with, you saw Lisa Su and the team caught up. And so that was going to start to show really in 26, 27, 28 in regards to revenues. And that's where we're going to have the flipping happening that I've been talking about in regards to AMD's revenue is going to start growing at a more rapid clip than Nvidia. This is huge. Like, you know, and Wall Street still doesn't even understand that. Wait till it actually happens. And that's only in a few quarters from now. You're going to see a flip. AMD's revenues growing faster than Nvidia. They're going to be like, "What? Oh my gosh." Right? Like AMD stock honestly shouldn't be up 7% today. But it is because a lot of these Wall Streeters didn't understand like, "Oh, there's a lot of demand for AMD." Like, and then they wake up to this analyst note and supply chain checks. They're like, "Whoa, people really want this AMD product." So like, oh my god, it's like, dude, where you been at? Old news, but that's all fine. You know, it takes you sometimes a while to catch up, Wall Streeters. You know, get with us. Get with us.
Okay. Now, additionally, this was kind of interesting here. Separately, B of A, this is a different analyst uh rating here. Separately, B of A provided a preview of AMD and Intel's uh kind of earnings results that should be coming here in a few weeks from now. The analyst said they expect AI servers to be uh the stronghold for compute, which AMD will likely beat and raise quickly growing data center exposure and product execution 355x ramping. The analyst also expect Intel to benefit from healthy uh server shipments. So yeah, BFA is expecting AMD to likely beat and raise. What's my opinion on that? Um, okay. Tell me something I don't know. Tell me something I don't. We all I know AMD is going to beat and raise next quarter. It's what they do. It's what they're going to keep doing for a while. There's going to be a lot of beat and raises coming. There's going to be a lot of beat and raises coming. Welcome to the party, pal. You know where you been at? Where you been at? And so, uh, you know, yeah, but Wall Street catching up, man. They're a little behind us, and that's fine. You know, it's my job as a little guy out here. It's my job to always stay in front of them, right? The Wall Streeters are the big fish. I just got to make sure I'm swimming way out in front and um, you know, I get my I get to my food first and they come and um, and then we all have a party. And so, you know, that's just what it is.
Hey, it's Jeremy. I hope you really enjoyed that clip here today. Listen, there are three main areas a long-term investor has to understand. You have to understand financial statements, income statements, balance sheets, cash flows. You have to understand and master portfolio management and you have to have the ability to project what is possible for companies in the coming years. Bearish scenarios, bullish scenarios, all these skills can be learned and that's the good news. And I'm still just a regular guy who's out here. I just have a lot of passion for the market. I've learned a lot over the last 15 years. I had a tremendous amount of success and I have a dedication to teaching people everything I have learned in the past 15 years. If I can do it, you can do it too. You can learn all that's required to become a great investor in my private group. The application is going to be down there in the description area. You can click on that, fill out an application, join us in the private group. Get access to all my best course curriculums teaching you everything that I got in my head. And you get ability to join our six-figure, seven-figure hall of fame. We have such a tremendous Discord. It is incredible. So once again, description area down there. There's a link. You can apply to join my private group in there.
So this was posted by uh one of our members in the private stock group. We have 3,000 plus members in there. I took a look at it. I didn't like what I saw. Okay, I hadn't seen the numbers. Remember, I've been unplugged for a bit here. Okay, but the newest margin data came out. Uh, we're at new all-time highs in regards to how much investors are, you know, have out there on margin, right? Uh, what this shows me is to be quite honest, guys, we need a six to 18-month drop in the market, right? I don't know if we're going to get that anytime soon, but we need it. That's the only way you can really kill off margin in a major way. Now, you're never going to take margin to zero, but in terms of getting it down quite a bit and getting people to be like, like I'm not taking risk. You need a m you don't like a one-week drop, a one-month drop. A lot of times it doesn't scare people that bad to really get them out of margin, right? You need a six to 18-month drop that that brings down margin considerably. Look, no different than 2020, right? And that was about a two to three-month drop we had in 2020, but margin came down significantly during that time. Look also, I think one of the best examples, look to 2022. 2022 we had the, you, the market dropped for right around a year, roughly, right? And look what happened to margin during that drop. It came down significantly as the market dropped more and more month after month, right? Every time you thought the market might bounce back, it got hit even harder. That's how you really get margin down. So until we get a six to 18-month drop, unfortunately, that number is going to climb, which I don't like it because that just means you got a more powerful sell-off coming at some point in time. When that sell-off is, could be six months from now, 12 months from now, 18 months from now, 24 months from now, 36 months from now, it's going to come eventually and it'll be a hard hit because margin's so high right now. But when exactly that happens, that's, you know, one of the toughest predictions to make out there, right? And, uh, as I say, a broken clock is right twice a day.
Now, to show you guys why you shouldn't mess with margin, because sometimes people think like, "Ooh, you know, margin's exciting. Like, I can invest even more money, which means I'm going to make even more money." Okay, here's the issue. Okay, margin calls. You go ahead, you have $25,000 in your portfolio. You go ahead and margin out another $25,000, right? So, now you have a $50,000 portfolio and you're thinking like, "My stocks are all going to 2x. So now I'm going to take this, you know, up to $100,000 portfolio all with only $25,000 of my own money, right? Sounds amazing, right? Oh my gosh. Like I got $25,000. My stocks are going to double and since I'm on margin, I'm going to go ahead and take this up to $100,000, right? And then I'm going to pay back my $25,000 loan and now I'm going to have $75,000." Sounds beautiful in theory. But here's the issue. You get a 30% draw, right? Which that's nothing crazy, right? Like a 30% drop, that's it's powerful. It hurts, but it's not like that's unheard of or that never happens. That happens all the time, especially if you own individual stocks. The moves are insane. I mean, look at 2022. Meta stock fell 75%. Like Shopify fell over 80%, Netflix stock fell like 80%. So, a 30% when you're in individual stocks is not a lot actually. Like that's kind of what you would expect from a decent sized drop in the market, right? Uh, so you get 30% down, right? Now you're down 60%. Because you're margined out, right? Plus, you're facing margin calls. So you're having to sell stocks at really bad prices. It's a horrible situation to be in. If you ever been there, you know what I'm talking about. It's awful. Ask anybody that's ever gone through a margin call. Brutal. One of the most brutal things you could ever face in the stock market. Absolutely brutal. Okay. And so you got to understand, uh, if you get a 50% drop and you're on margin heavy, you lose your whole portfolio. You're from a 50% drop. If you're heavy on margin, you lose everything. You're back to zero. Robert De Niro. That's what we're talking about here, ladies and gentlemen. It's serious. It is serious. Serious. And not in a good way, right?
What you actually need to focus on. Don't focus on margin and thinking about, you know, trying to be greedy and like, oh, the market's going to pop big and this stock's going to 2x and 3x and I need a margin. No, no, no. Focus. Keep it simple. Okay? Focus on making money, as much money as you possibly can. Okay? That's where you need to focus. Focus on researching stocks, running projections, invest as much as you possibly can, and repeat that every year. And as the years tick on, you'll end up having more money than you know what to do with. Okay? It's a simple game. You mess around with margin, right? Might sound fun if it all goes right, but it might not go right. And many times when people are loading up on margin, it's a time you shouldn't be loading up on margin, right? That goes wrong. And then you set yourself way further back. And next thing you know, it takes you two, three, four years just to climb back to where you used to be. Because you went heavy on margin. Okay, don't mess around with that stuff. Focus on these things. Keep it simple. Over 10, 15, 20 years, dude, you'll have more money than you ever know what to do with. Like, come on. That that that's what you got to actually do. Focus on that stuff I have there, right? I'll give you a good example. I've been in the market now 17 plus years, right? Where am I at financially now at this point in time after all these years of investing? Right? I saw these cool shoes on social media over the past like week. Nike 01. They're like Nike Mind 01's and 02's. You can't even get them. They're sold out, right? So, you know what I did? I paid like two times, three times the price cuz I just want them. And you know what? It's irrelevant. The amount of money I spent on those shoes is literally irrelevant cuz I've been doing this for so long. I built up to such a high net worth that a $260, it doesn't matter. It's literally insignificant, right? In regards to my net worth. If I, this is yesterday, I went to lunch with the kids at Flowerchild. It's not like kids, we got to go eat at McDonald's, right? There might have been there was a time when it was fast food, right? And it was like, shoot, I got to like, you know, eat the cheapest thing at Taco Bell and cheapest thing at Burger King to try to save some money. There was a time period like that. You're 17 years in this game doing what I do. You don't have to worry about that anymore. It's like spend $60, $70 on the kids at lunch. Like, it's nothing, right? Go out to Cheesecake Factory last night. You know, after tip, it's $170. It's irrelevant. It's irrelevant. But that's 17 years on the market, right? Go on vacation, stay at the Nou hotel in Miami, go to Nou twice. It's not like I'm looking at the menu like, should I get that because this is expensive or blah blah blah. It's irrelevant. It doesn't even matter. But that's 17 years in the game. 17 years working my butt off, taking this serious, investing as much as possible, right? And then all these little expenses which this is like all little stuff like going out to eat, staying out of hotels, like stuff like that. That's little money, little money. It's irrelevant now, right? There was a time when this mattered significantly to me. That was 17 years ago. That was 15 years ago. That might even been 10 years ago. But as your net worth builds up and you do the stuff I'm talking about here, this other stuff, you're not worried about like what hotel can I stay at? Uh, let me find the cheapest one. Got the cockroaches in it. Like, you know, where could I eat? Where's the cheapest place to eat? Uh, who cares about quality? Like, no, no, no. I'm When I just think, I'm just like, what's what's the best, right? What's good? Because that little money stuff's irrelevant. No, think about 17 years from now. If I'm in good health and I stay hungry, right? If I get hit by a bus, okay, doesn't happen. That's fine. Like, it just is what it is, right? Life. But if I'm in good health and I stay hungry, imagine what lifestyle will be like in 17 years from now, right? Imagine vacations. We're talking private jets because that would be irrelevant then, right? If I got a private jet now, I'm going be stressing. That's a lot of money for me right now. If I got my own yacht right now, that's stressful. 17 years from now, could have multiple yachts. It won't even matter, right? Uh, I could have homes instead of staying at resorts like, "Oh, I'm gonna stay at Nou Hotel or stay at a really nice place in Mexico." No, no, no, no. Could have homes in all these different vacation destinations because it's like little money stuff like that then is little money, right? So, focus on the stuff you act like that actually matters and stay away from the stuff that's going to screw you over like margin. That that that's like craziness, right? Like if you are younger in this game, right, which a lot of my audience is anywhere between 25 and 45, like you got plenty of time on your side. Just focus on this stuff right here. Don't get caught up in all that margin, all that other crap, man. And like I said, you'll have more money than you know what to do with, man. You'll have more than you know what to do with. So stay focused on the long term. Don't get caught up in all the short-term crap, man.