Transcription
This stock is going to make millionaires in 2025. Check this out.
So, today, I don't know if you heard, but a company by the name of Constellation Energy, CEG, just signed a massive 20-year deal to supply power to Meta. This is the first of its kind in the United States, but definitely not the last. What am I talking about? Where am I going with this? How am I going to land this plane? Stick with me. Don't click nothing. Don't smash nothing. Don't buy nothing. Just listen.
So, Constellation Energy, a company that basically deals with nuclear energy. Why is it such a big deal? Why everybody's excited about nuclear energy all of a sudden? Why Constellation Energy signing a massive deal with Meta? Now, I'm not talking about the sort of DMs I got this morning when the stock spiked, then it basically brought everything back. I don't care about the short-term price fluctuation. That's not the point. And this video is also not about Constellation Energy. Believe it or not, it's about a whole different stock. But I do want to point out the methodology behind the system.
So on March 25th, 2025, three months ago, I posted on my Roy Academy on Patreon saying, "Folks, this CEG Constellation Energy is now added to my top stocks list." Now, the reason I've added this stock back then, as I elaborated in my deep dive, which I posted for my academy members, which I do every time I add or subtract a stock from my top stocks list, the reason was quite simple. Two things. Number one, there was a fundamental reason why I liked Constellation Energy, which I'll talk about in a second. And it's also the reason I like the stock I'm going to show you today. But I've also noticed that the share price dropped from 350 in January of 2025 all the way down to 226 when I looked at it and added it to my top stocks list. So I like a good deal. I like an opportunity. So if I see a wonderful company with a massive bull case being sold off, you remember the chart I kept showing you? When the business keeps getting better, but the price drops, this is what I get interesting.
So, I post about the stock. It's been a few months since, been 3 months since. The stock is now back to 330 as of the making of this video. About 50% give or take over the past 3 months. Not bad, but too soon to celebrate. I'm going to say it right now. A lot of my academy members have been DMing me saying, "Congratulations. What a good call." It's too early to tell. We need to wait a couple years, three, four, five years to see where this thing is headed. There's no point in celebrating these short-term price fluctuations. Yes, it's nice it did 50%. But it's not a real metric of how I'm going to judge this call. I'm going to judge it based on what it does for the next 5 years for my academy members. Can we deliver another Palantir? Can we deliver another Nvidia, another Tesla? Stocks we actually put on the top stocks list of the past few years right now.
Where am I headed with this whole Constellation Energy? Right? So here's the thing. So how do they know about Constellation Energy? And more importantly, is there a similar stock that is completely under the radar just as Constellation Energy was three months ago? And if so, will you let us know, Tom? Well, the answer is definitely yes on both counts. I knew I know again and I will let you know because there is a similar stock and no it's going to be absolutely free and not paid. I will share with you a stock which I think is going to do very well just like Constellation Energy did. In fact, I'm going to let you in on a little secret if you won't tell anyone. I've actually added it to my top stock list on Patreon. Tom, why are you revealing this? This should be behind the paywall. I don't put things behind the paywall to get people to join. People join because they want to learn, because they want to get better. I don't hide this.
So, today you'll see a stock which I've added, actually the first stock I've added to my list since Constellation Energy 3 months ago, and I'll show you why I think it's going to do similar things to Constellation Energy. By the way, we've actually done a full-blown deep dive, an hour and a half article and a lecture and a whole Zoom session about this topic, about this thesis. And I've shared with my Rock Academy members 10 stocks, a list of 10 stocks, including deep dives into each that will benefit from a similar thing, just like Constellation Energy and the stock I'm about to show today. So, we do have actually something behind the paywall. Sure. I got to give something for my members, for my academy students, right? So, there is a list of 10 stocks that my academy members get to see beyond what I'm about to show today. Also, they got an early peek into this stock. They got it a few days ago ahead of you guys. Obviously, you know, I got to give them something extra. But, as you can see right now, I'm going to reveal everything to you. And if you actually want to see the other 10 stocks, you can join the academy and learn about them. But the one I like the most, the one I've added to my top stocks list, this is the one I will let you know for free, which is literally giving you the best one for free. And everything else, the other 10 stocks, they will be behind the paywall. Okay, just to be fair, I think we can all agree that's a fair arrangement for everyone. Okay, let's move on.
So right now the best, biggest, most hypest stock in the world is Nvidia. Everybody knows that. Jensen Huang with his leather jackets and his swag and his clout looks like a superstar, like a rock star. So just a few days ago in Nvidia's earnings call, Jensen Huang said something very interesting that went over the heads of a lot of people. He said this. Every future data center will be constrained will be limited by power. Power is going to be the biggest problem to solve going forward with data centers. Not our chips, not the Chinese regulations, power.
Okay, so what is he talking about and how we can use that to make money? Okay, so we've actually talked about it in our academy session yesterday when the whole deep dive into this, but I'm going to give you the brief executive summary here, right? Basically, we used to run data centers back in the day on CPUs and they were good at what they're doing. They were decent. But as we started requiring these data centers to do multiple tasks at the same time, run AI applications and do these elaborate complex things at a massive scale parallel. We found out that GPUs are really, really much, much better than CPUs in doing that. And guess what? The world's premier GPU producer is Nvidia, which means that Nvidia became overnight the sensation of the high performance computing, data center, AI, whatever you want to call this revolution. So as Nvidia becomes the best of the best, the monopoly, the guys who own the GPU market and essentially own the data center market, something interesting started happening and I call it the supercar problem. What am I talking about? Supercar problem, Tom. That's rich people's problem. Well, hear me out here. Okay.
So, basically, if you own a supercar, something that I don't do because I don't like supercars particularly. I mean, I like practical vehicles. But nothing wrong with having fun and having a Porsche or Ferrari or a Lambo. Go right ahead. Right. But here's the problem. Supercar owners know one thing. There is a problem. It's very expensive to maintain. You need to fill it up with a special gasoline, right? It's very complex and expensive to run. And it needs good roads. I mean, you're not going to be running a supercar through a gravel road behind the barn, right? So, you need great roads, great gasoline, great maintenance, great mechanics, great parts, and everything is super, super expensive and hard to get and so forth and so forth. So having a supercar is a very complex thing to do, right? And Nvidia in our example is that supercar, right? The Nvidia GPUs are the supercar of high performance computing (HPC), right? Of data centers, right? And this is the biggest problem with running a supercar when it comes to our analogy, right? So as demand starts increasing because everything becomes AI-driven, healthcare, banking, leisure, you name it, right? Demand for these high performance computing, for these data centers driven by AI, driven by Nvidia GPUs, it becomes absolutely insane. The demand starts to grow exponentially. But since now everybody owns a supercar, those supercars, they require the good roads, the good gasoline, the good parts, the good infrastructure, right? You can't drive these on gravel roads. So now you're dealing with local grids for the most part not built for that. You're dealing with a massive carbon footprint because you're putting a lot of pollution into the environment, which is not good. And you also, unlike a regular grid, I mean, you can't afford this stoppage with a data center like that, right? If your house goes out of power for half an hour, not a big deal, right? You light a candle, right? These data centers if they go out for half an hour, an hour, we're talking a massive collapse of half the western hemisphere. Look at what happened with CrowdStrike, right? So no stoppages and mostly somehow you have to cool these data centers because the rack density is so high now and these things are emitting so much heat. Somehow you have to figure out a way to cool this to prevent this from melting down and actually to allow this to work efficiently. So you have a new host of problems that have nothing to do with the Nvidia side of things, but they have everything to do with the infrastructure, with providing electricity, with making sure it doesn't stop, it doesn't pollute, and you have to cool this whole thing. These are new problems that the AI gold rush is not pricing in yet. As everybody on social media is talking about Nvidia and Palantir and LLMs and OpenAI, nobody's talking about the infrastructure, nobody's talking about the roads, the picks and the shovels of the business. And that is why I fell in love with Constellation Energy 3 months ago and 50% ago when they said, "Look, these guys are basically the biggest best providers of nuclear energy in the United States, right? Nuclear energy is low on carbon emissions, right? It runs 24/7. No interruptions, no outages. It's very reliable, right? And the capacity, basically the amount of power you can, you know, take out the bandwidth of these nuclear reactors is a lot bigger than regular classic power, right? So that suits perfectly with all these problems right here, right? Most of these, not the cooling part. We'll talk about that in a second, right? And then I said, okay, so that's why CEG Constellation Energy was such an interesting choice. But now, right, who else? Who else can fit in here and make a lot of money? And this is exactly what we're going to talk about in the next slide.
Okay, so check this out. If you answer these questions, you're going to figure out who's going to make money off selling picks and shovels like in 1850 in California. Who's going to be selling the tents, the jeans, the the picks, the shovels, the equipment, right? Who upgrades infrastructure grids? Who lays down power lines? Who builds software to manage these grids? Who provides low-carbon power? Who builds cooling solutions that are innovative and they're able to handle this? Who actually digs up raw materials? Because I mean, you need uranium, for example, to run nuclear, right? Somebody's doing any research about that? No. And the entire social media world is busy making deep dives again and again into the same five companies. Nobody's talking about these boring things, infrastructure, because it requires research. It requires looking into boring businesses. People want the excitement, but the money is made under the radar, not in the place where everybody's looking.
Okay, so where am I headed with this? Allow me to show you. I mentioned a second ago, the 1850 gold rush in California, right? In our example, AI and LLMs will be the gold rush in this analogy, right? But here's the crazy part. As everybody knows, I'm not telling you anything new that you haven't heard of before, right? Real money in the gold rush was made by selling these things, picks, shovels, tents, equipment, boots. I mean, you could make a lot of money selling boots in 1850 to the prospectors, right? So, not necessarily people got rich just by finding gold. I mean, obviously, a lot of people got rich by digging up gold. That's fine. But a lot of people got rich by selling and building the infrastructure to allow that whole operation to continue. And if you look right, it's exactly what happened so far in AI. The gold rush is large language models and everybody and their mom has an LLM to the point where it's very, very hard to make business and money off of LLMs because it's so saturated. It's so commoditized, right? That's why a few years ago we were talking about the first layer of infrastructure and we said Nvidia. Nvidia is a stock which I added to my stock to my top stocks list couple years ago again, 1475% over the past 5 years. Okay. Then we went on to Palantir and we said look, the next stage after infrastructure, after the GPUs, who's going to run these LLMs? We need an operating system to allow these LLMs to integrate into businesses. Well, you have the operating system with Palantir and AIP. That thing did 1300% over the past 5 years. So over the past 5 years, two infrastructure plays in AI, not LLM, two infrastructure plays, Nvidia and Palantir did 1,400%, 300% both on my top stocks list before they exploded out of the stratosphere. Okay.
So is it a good idea to invest in Nvidia and Palantir now? I mean, they're both great companies, and I believe that these two companies would be an amazing addition to any portfolio in my opinion. Okay, I have nothing bad to say. In fact, I'm the biggest Palantir bull ever in existence, right? And I will continue to dollar cost average into Palantir until I'm in my 80s, 90s, hundreds, who knows, right? With Nvidia, right? A different question. How much more can they double or 3x or 4x from here? It's a question, right? But both are terrific companies, but also both are extremely hyped. Both have been appearing all over social media. Everybody's talking about them. They already done the parabolic spike. There's still money to be made, but the 1400% and the 1300% was already made by somebody else and my community. Welcome. Thank you. Now, so you got to look elsewhere if you want the next explosive massive under the radar hidden gem. Okay. Okay. These are no longer under the radar. I think we can all agree to that. And very importantly, they're no longer under the radar. Where is the next hidden gem, folks? That's what we will cover in today's video. Okay.
So, let's talk about it. So, the reason I picked Constellation Energy is the same reason I'm going to show you the company which I'm going to reveal in a second which I've added to my top stocks list. Right? The reason is because nuclear power capacity solves all these problems. Carbon-free, no stoppages, massive capacity, right? It's ideal for data centers. And I've basically said 3 months ago, hey, somebody's going to make a deal with these guys because this is just, you know, this fits like a glove for the data center business, right? The hyperscalers, they'll come in and they'll start, you know, using these guys. And that's exactly what started happening with Meta. And I believe Meta is just the first of a long line of top-tier companies who going to make deals with Constellation Energy. But now the big question is, okay, what's next? Okay.
Now, as I said before on Rug Academy, we have a lecture and a deep dive with 10 names which all fit into this trend. All companies such as resources, raw materials, nuclear, renewable, a lot of different stuff. Okay. But today I want to focus on one company which I've added to my top stock list which is VRT, Vertiv. Okay. Ticker symbol VRT, Vertiv. Who are these guys and why do I why do I think they can be just as good as Constellation Energy if not better and why I've added them a couple days ago to my top stocks list. Right.
So VRT basically provides cooling solutions. Okay. Essentially what they do, obviously they have some battery backups. They provide these batteries that essentially prevent these data centers from failing and, you know, stopping. But the reason, and I told this to my academy members, the reason that I'm so excited about VRT is not so much the battery stuff, which is good, it's these cooling solutions for data centers. Okay. So if data centers are built on Nvidia GPUs. So if Nvidia GPUs are the brains of data centers of high performance computing, this thing, cooling, is the heart, lungs, and the AC that runs in the room where this whole thing actually takes place. Now I know it sounds weird to you and you say, "Well, cooling, well, it's not such a huge deal. Cooling, who cares?" Hold on a second. Okay, hold on.
So basically overheating in a data center, that's game over. That's game over for your business, for your company, for your brand. That's brand reputation damage that you will never come back from. Okay? That can cause massive, massive problems for companies. So they have to spend massive resources to make sure that it won't happen. And as these companies increase every single day, the density of these racks and they're asking these data centers to drive more and more and more and more compute and they emit more and more and more heat at exponentially higher levels than what CPUs used to do. You need a way to manage all this thing and to make sure it doesn't explode and make a big kaboom and finish your business. And that's why I like VRT because they provide the solutions for this, right? They have uninterruptible power supplies. They have cooling solutions. They have management software that manages this whole thing. Actual enclosures. They buy prefab rooms. They provide support aftermarket. And they've got power distribution units. They do everything. But mainly, mainly, mainly what I'm excited about is the cooling solutions. Okay. This is the next big wave with data centers. Okay. Nuclear is one. Energy supply is one, but you have to cool down this thing and I don't think people realize how much heat these data centers are emitting and how existing air cooling solutions just cannot solve this problem. Regular cooling solutions that were used so far are not relevant for this new generation of data centers and this is where VRT comes in. Okay, this company with their liquid cooling and immersion cooling and all that stuff, all these new technologies. Look at what they've done over the past year. So they generate 8.5 billion dollars of sales in a year. They're currently growing at 20% per year. Net income of 1.5 billion per year, a growth of 65% in net income year-over-year. When you drive 20% more sales, and you get out of it 65% more net income, that means you're a scalable company. That means you have great management, and that means that you can actually grow sales without investing so much money. This is beautiful. Now, free cash flow means that they have $1.3 billion of cash flowing in, growth of 52% year-over-year. So, the company's fundamentals are firing on all cylinders. Margins are incredible. 36% gross margins for this industry is pretty good. But what's even more impressive is the operating margin of 17.3%. If you look across the board in this industry, double digits, almost 20% operating margin. That is extremely high. And all of this is now selling at 314 PE, which is not that high. And unlike the other companies in this field, they have one to one cash and debt. Usually companies in this environment, they're very leveraged. These are expensive businesses to run. You need to borrow a lot of money to run these sort of businesses. These guys are one to one almost on cash and debt. A P/E of 30 and these monopoly numbers. I give it a cool A minus. Why A minus? I want to see higher growth because I want to see here proof that this thing is actually started to grow exponentially. Okay, this is the one thing I'm missing to have the final stamp of approval that this thing is actually going to the moon. But an A+ would still be absolutely terrific.
Now, obviously, it has risks. If macro goes south, if the economy goes south, this whole thing goes, you know, to the toilet. There's risk of competition moving in on them. Big companies who would love to compete in this field. Sure. Supply chains may go absolutely insane. Look at what's going on right now with Russia and Ukraine. Maybe you're on the precipice of whatever is going on over there. Look at the Middle East. So supply chains and of course execution risk. If they make one mistake and a data center basically melts down because they didn't cool it properly, they're over. They're finished. So a lot of risks here to consider, right? On the flip side, the potential here is significant, right? So, basically, liquid cooling is probably the biggest disruptor in data centers going forward for the next two, three, four, five years. Air cannot cool down these data centers. Okay? You have to have liquid immersion cooling, which is what VRT is number one at. They are the gold standard. They're the dominant player in this industry. This is the biggest disruptor in data centers. This is the biggest next infrastructure play that most people are sleeping on. They're talking to you about companies that already done 1400%. They're not talking to you about this great company who's absolutely under the radar. Okay. My price target for this company for the next 5 years. My bare case is $185, which is 70% growth. My medium case is $288, which is 164% growth. My bull case is $391, which is a 260% growth in five years. Those are my price targets for this company. Again, these are not aggressive. I've basically modeled these, even the bull case, after a very conservative model. Again, everything is on Patreon. All the models, all the deep dives, all the logic is in, you know, is basically on Patreon.
And look folks, I get it, right? Palantir amazing, Nvidia is amazing. But if you want to make real money, if you want to make these crazy numbers that we've done on Palantir and Nvidia and Tesla over the past few years, you know, you have to find the hidden gems, something that's not hyped on social media, something that's boring, something that's a great business. You have to find that one thing that is absolutely misunderstood. Don't forget, Palantir used to be hated on. It's hard to remember this now, but Palantir used to have so much hate, right? That's the time to start accumulating like crazy. So, right now, what I suggest you do is before you sign off this video, go to patreon.com/dommnash. Check out Roic Academy. You can get the top 10 data set of stocks that I love. You can get my top stocks list for the entire set of stocks I am bullish about. You can read deep dives about Constellation Energy, VRT, CrowdStrike, Tesla, just to name a few. We've recently done 60 lectures on demand you can watch about long-term investing. And you have eight new monthly meetings and lectures every single month for the academy. And you get to participate in this amazing community. Thank you so much. I'll see you the next one. Peace.