Transcription
Folks, this one stock might change early buyers' lives. In today's video, we're going to break down the latest on the market and plays. And then we're going to go on to this one stock that I believe has extreme potential.
This is a company that I'd argue is set to get a ton of traction and coverage over the coming weeks and months because of its close connection to the president and his administration. This company sports a major government contract, is linked to the president's son directly, has a massive competitive moat around it, and has tons of potential upcoming catalysts that I've identified for you. I'm going to present my case for it, as well as the risks to consider, and I'm going to let you be the judge. And of course, as always, if you're the one taking the ultimate risk, you got to be the one doing the ultimate frisk. Always do your own due diligence on all ideas presented. Remember, lots of people get frisky frisky without thinking about their risky risky and vice versa. Big problem.
Okay, let's start with the market context. So, the biggest theme we've seen play out this year again and again is this belief, avoidance, and really utter hate for the stock market's uptrending this year. So many big major fund managers all across Wall Street absolutely are pissed that the stock market has returned as much as it has this year. If you recall back at the very beginning of this year, we were told by nearly all of the financial media outlets and financial experts and fund managers that 2025 was going to be the year of a major recession, a massive unprecedented market crash that won't recover for decades. And we were told that buying the dip in April would be the biggest mistake of our lifetimes.
Now, of course, for folks who follow this channel, and really for any folks that weren't headline jockeyies, well, obviously this has been an unprecedented successful year. In fact, there's hundreds and hundreds of companies specifically in the AI space and the rare earth component segments that have had double or triple or quadruples, many of which we called out here on this channel, and there's also many more outside of the scope of what we've covered. Now, that being said, just because things have gone up doesn't mean they're going to continue. And it's very, very important to make sure that you're buying good assets. And in my opinion, when it comes to outperformance in a market that's already up so much, it's very, very important to focus on three different segments: companies directly serving the AI arms race, companies getting new US government contracts, slashstakes, slashbacking, financing, so on and so forth, or companies that fall into both categories.
Now, of course, we've been working hard all year to give you these ideas both here and on the Discord, and we're going to continue to do so. But today, we got to start you with quantum. So, last week it came out that the Trump administration was in talks to take stakes in quantum computing firms. And this was from the Wall Street Journal. And then those stocks like our favorites and others RGTI, QBTS, QUBt, IONQ, and others subsequently rallied massively. And then the White House came out afterwards and denied being in talks to take an equity stake. However, once that news dropped, prices barely went down. Why? Well, I think it's because markets don't think that the White House is going to miss taking a stake in Quantum. I think markets still believe there's going to be a partnership stake in some form and/or other deals for Quantum in the future, and they're trying to position accordingly. Trump has indeed already signed deals promoting investment into quantum and considering that China is pouring public investment into the speculative nextG computing space. While many many expect to eventually do the same as well.
Now, one of the things that a lot of folks don't understand about quantum is that quantum is very, very early stage technology. The use cases are limited, it's really just an AI arms race component. It's one of the battlefields, I should say, of the AI arms race. It's a sector that's going up because there's tons of investment, not because there's real world use cases today. Quantum stocks have been a hugely followed sector all year and the top performers QBTS and RGTI we actually called out at very, very small fractions of the current trading prices because we believed and we continue to believe very strongly that while quantum is early stage and is far away from most regular use cases, it will continue to see investment because it is a front on the AI arms race. If you go back through my videos all year, you could find many, many, many companies including RGTI, QBTS, QUBt that many folks said can't go up because, oh, the technology is too early. But what I think a lot of people don't realize is that folks are buying the stock in anticipation of big government backing down the road. We've called out a lot of the government backing stocks before the government even officially announced them being backed. And I think you're eventually going to see specific quantum stocks be added to that list. And it's probably going to be during a cycle where nobody is even talking about quantum and quantum stocks are down, so that the government can get a better deal in terms of entry price. There's a reason that you're seeing big banks like JP Morgan invest in this segment. There's a reason why more and more people are talking about Quantum, and it's not because the use cases are here today, tomorrow, or next month. It's because they're expecting more investment down the road from other players. Buying Quantum today might have been like buying nextG GPUs 15 years ago.
Now, look, you're going to be hearing more and more about Quantum this week because Nvidia's GTC conference starts this week and there's going to be a bunch of Quantum presentations. And most importantly, you're going to want to pay attention to CCCX this week. Why? Because CCCX is the spa that is set to take Inflection public. And Inflection CEO Matthew Canella is speaking this week at Nvidia's GTC. Tuesday, you're going to see a huge spotlight on Inflection and by extension CCCX. But what exactly is Inflection? Inflection builds quantum computers and sensors using neutral atom technology, which traps and controls atoms with lasers to perform quantum operations. Why does this matter in English, Charlie? Well, their tech can power quantum computing, navigation, and defense applications from super precise clocks to next-gen AI simulations.
Now, when you talk about proof of concept and their relationship with Nvidia, not only does this company already make tens of millions of dollars worth of revenue, but Inflection works directly with Nvidia's CUDAQ platform using Nvidia GPUs for hybrid quantum classical computing. Inflection aims for 1,000 logistical cubits by 2030, positioning itself as one of the top US quantum hardware players alongside ion Q, Regetti, and PSI Quantum. So, backing up, what exactly does CCCX have to do with anything? Well, CCCX is what's called a spa. A spa is a blank check company that goes and basically buys up and engulfs a private company and effectively takes it public. Now, the way that spaxs tend to trade is what? Well, usually you get a lot of anticipatory running up and then right before the merger, once it merges, you see a dumpy dumpito for a few weeks and then the long-term value is revealed. But why exactly would somebody want to buy the spack, the CCCX? Well, when buying CCCX, the pre merger entity, while investors have optionality. If the quantum buildout goes well, upside could be multiple times the current market value. The market is still in the early innings for scalable quantum hardware plus sensing. And so, so extreme upside potential can be realized over the years. But also the spa has cash in trust and the merger proceeds give the combined entity capital to scale. So once CCCX merges with Inflection, taking it public, well, Inflection is going to have all this extra cash and that's going to help it accelerate its trajectory. If one believes quantum eventually is going to become a foundational infrastructure theme or like I do, simply believes there's going to be even more investment over the coming years because of all the trends that we're seeing, that means that CCCX might very well have favorable leverage to that narrative. Aka, it's one of just a few players that is really, really embedded into the quantum ecosystem. So anyways, in totality with CCCX, it's a very high-risk play and it is a very high potential play if you believe in the long-term quantum sensing AI infrastructure theme and you're comfortable with that elevated risk, early stage, back and execution dependent. Well, while CCCX does give you a very volatile but leverage stake in the future there.
A lot of people say, you know, Charlie, you shouldn't be talking about quantum stocks because they're very volatile. They're very early stage and there's a lot of risk with them. Maybe you should talk about something safe like Home Depot or McDonald's. Remember, volatility and risk, those are the prices that we pay for outperformance. I like the McDouble and the Big Mac and the Little Egg McMuffins as much as the next guy, but I'm not buying those expecting huge upside. Maybe in terms of the waistline, but not in terms of my portfolio. We've always been about presenting lopsided, asymmetrical, crazy upside potential and identifying the risks and being aware of those risks and strategizing to manage those risks. So, anyways, that is something to consider there.
Okay, main entre. So, it just came out that a firm connected to the president's son just got a major Pentagon contract, and that's this company, UMAC, which is Unusual Machines, Inc. Now, UMAC is a small US drone company that is benefiting massively from new laws pushing American-made drones. As the government bans Chinese-made drones and parts, UMAC stands out as one of the few companies already producing US approved components like motors, controllers, and cameras. And it produces all of this at its new factory in Orlando, Florida. With its popular consumer brands and its official approval for government and defense use, UMAC is set up to become a key supplier as the US builds out its own drone industry over the next few years.
Now, I think it's very, very important that you understand the timeline of what's happened with this stock. So, November 5th, 2024, President Trump gets reelected. November 27th, 2024, Donald Trump Jr. joins UMAC company. Publicly announces Donald Trump Jr. has joined as an adviser to the company and confirmed that he already owns shares. He explains the importance of onshoring drone production. Ending of 2024, The Guardian and Market Watch and some others publish articles highlighting Trump Jr.'s involvement and the company's link to the US military drone ecosystem. Public awareness of UMAC surges. June 4th, 2025, Unusual Machines signs a lease for a 17,000 square foot Orlando drone motor factory, substantially upping domestic onshoring. June 6th, 2025, Trump's US executive order to accelerate US drone production is signed. And then October 24th, 2025, Financial Times reports UMAC winning a contract to supply 3,500 drone motors and option for 20,000 more to the US Army under a Pentagon order. This reporting has been going viral on the New York Times, on of course this Financial Times outlet, and so on and so forth. Meaning that there's a lot of eyes now looking at this company. And even with that aside, this executive order is a big, big win for the company.
How does this order help UMAC? Well, for one, the executive order explicitly emphasized sourcing from NDAA compliant US-based manufacturers, a direct tailwind for Unusual Machines, which was already positioned as a made in America drone component producer. This alignment with federal procurement rules gave UMAC a fast lane into defense and homeland security supply discussions. Number two, demand surge across federal and state agencies by mandating federal departments like the DoD, the DHS, FEMA to accelerate US drone fleet modernization. This order unlocked new streams of RFPs and small business contracts. UMAC specializing in drone motors and component integration suddenly had a much, much larger addressable customer base overnight. We love Uncle Sam creating a massive customer base for companies. That's an easier business model. Almost any other business if you're just operating in the free market, you kind of have to go out there and you have to convince people like we have the best product. When you see these companies that Uncle Sam is just kind of creating their own market for, well, that's a big de-risking and that means that the stock should trade at a much bigger premium. Number three, investor and media visibility explosion. I believe you're going to see huge, huge explosion of coverage on this stock. Number four, strategic leverage in supply chain acquisitions. The executive order accelerated consolidation in US drone manufacturing. UMAC leveraged this policy environment to finalize its acquisition of Rotor Lab and pursue other component integrations, strengthening its vertical stack and supply chain control under a very, very favorable policy umbrella. And then number five, validation of UMAC's core narrative. So before the order, UMAC thesis, reshoring drone production sounded aspirational. The previous administration didn't really care that much about this goalpost. However, with this new administration and after this new order, it's become national policy to onshore drone production. The whole business model is now national policy. In my opinion, this alone suggests a massive rerating potential, much, much higher. UMAC is at the intersection of policy tailwinds, defense re-industrialization, and a surging drone economy. And if it continues scaling, securing even a fraction of the defense procurement wave and builds its brand as the face of US drone manufacturing, well, obviously the stock can go much higher.
But what are the risks with this? I think it's very, very important to talk about the risks. I get excited about stocks on these videos, but I want to make sure that you're aware of the downside potential here because these are all very volatile and very risk on stocks. Look, while this now has this relationship with the Trump administration, that could also be a downside in a couple of years, maybe after midterms if you get a bad result or after 2028. And these are things to consider because the stock could sell off well in advance of a political shift. Stocks that are backed by the Trump administration and are moving favorably in the Trump administration are going to be the first to go down as policies revert. That's a specific type of political exposure that you don't get with every stock, but you're definitely getting with ones that are backed by the Trump administration in some way, shape, or form. It's also true that the next administration might go and reverse the American onshoring initiatives. It's true that many other countries like China can make drones way cheaper than we can. And there's a lot of politicians that would argue let's just depend on China for a lot of these things even in the defense sector because we're going to be able to save a few bucks. I think that's probably a low risk because quite frankly, it's crazy to put defense in China. But at the same time, I mean, there have been levels of that in American policy for like many decades. It was both Democrat and Republican regimes where you had this crazy, crazy offshoring of a lot of these rare earth components, for example, that are actually critical to our national security. So these are things to consider and these are risks to highlight over the long run. That said, I do think that UMAC has way more pros than cons over the next 12 to 18 months because of these major policy tailwinds.
So what about future potential catalysts? Well, Army follow-on contracts and DoD scaling. UMAC's initial award for 3,500 drone motors and components could evolve into a much larger multi-year procurement. The Army has already hinted at 20,000 additional units in 2026, setting the stage for recurring, higher volume defense contracts if deliveries meet spec. There's also the opportunity for more Blue UAS approvals. Each time a new UMAC product, like flight controllers, cameras, or motor controllers gets approved under the DIU's Blue UAS program, it becomes far easier for government and public safety buyers to purchase it directly. Expect new listings to open wider procurement channels and more catalyst spiky mix spiky opportunities. And then of course, you have policy tailwinds favoring US-made drones. The June 6th, 2025 executive order to accelerate domestic drone manufacturing combined with the section 232 investigations into foreign drone parts positions UMAC perfectly as a compliant American-made supplier ready to benefit from federal funding and procurement priorities. There's also the conversion of early wins into recurring orders. UMac's $12.8 million defense order and commercial supply deals show traction. Consistent execution and performance could turn one-off deliveries into repeat programmable orders across the army, air force, and law enforcement agencies. Vertical expansion into full systems, owning FAT, Shark, and Rotor Riot, which are the consumer divisions of this company, give UMAC a clear path to move beyond parts, creating complete FPV, ISR, and training drone kits built around its blue listed components. That integration could potentially boost margins, simplify procurement, and further entrench into the defense drone ecosystem.
So anyways, that is the bigger picture rundown on UMAC. Let us know what you think down there below. You have a high potential stock with also high potential risks and things to consider. That being said, after I'm done posting this video, we are going to go and alert calls in the Discord. So, if you'd like to see those, make sure to join us with that first link down below. Anyways, that caps off today's video. Have a great rest of your day. We'll see you next time.