Stocks of the Week
Hand-picked stock analysis every week. What moved, why it matters, and what we think.
Educational purposes only. Not financial advice.
Why It Moved
AMD's run this week was driven by the renewed demand for AI chips and strong sector momentum among a market scrambling for answers in this AI crisis. AMD is in the center of AI data centers from strong chip quality design but it faces cutthroat competition from similar companies NVDA, INTC just to name a few.
Bullish Case
AMD does report Q3 on November 3 after market close. If AI-demand is around this level AMD will continue to rise aggressively because of its rampant data center growth and AI CPU demand. AMD has also recently crossed the $1 T market capitalization which shows the amount of liquidity that investors believe in AMD.
Bearish Case
AMD is currently heavily overvalued right now as it just broke its all time highs and which traded at a whopping $645. If growth and the necessity for AI chips were to normalize from this extreme level, AMD would plummet from its current standpoint.
Written by Trevor
Why It Moved
CRDO rocketed this week from a new AI-product launch as the company unveiled advanced 224G-based ZeroFlap optical transceivers for high-speed AI data center networks. CRDO is regaining momentum after earnings earlier September which will be interesting to see play out regarding Anthropics CEO's warnings about the dangers of AI usage.
Bullish Case
I don't see this stock regressing significantly in the meantime. CRDO has grown out of control this past week for a near 20% gain so I'm positive that it will ride this momentum and continue its growth.
I actually listed this stock when it traded around $170. Please view the section 'Our Trades' regarding more information and my current position in CRDO.
Written by Trevor
Why It Moved
Society has been having increased concerns over AI threats and reports where AI was able to bypass safety restrictions. Naturally, this has caused investors to rely on cybersecurity companies. CEO George Kurtz also said that government regulations wouldn't be able to work and would only stifle US innovation, and that tightly knit cybersecurity would be the only preventative mechanism to stop these threats.
Bullish Case
The company has reported 1.47 billion dollars, which is a 26% year over year increase. The company has also reported 333 million dollars in annual recurring revenue, which pushes a 56% year over year increase. Obviously, this company's financials are crushing WS expectations, which makes it a statistical powerhouse. They also have branched out their partnerships with Nord Security and Horizon3.
Bearish Case
Since the company has reached exponential growth, it will be extremely difficult for it to match the Wall Street expectations. Financial sources (WeBull) also give the company an overvalued status, and its projected mature free cash flow will cause additional dropping of its price.
Written by Reavis
Why It Moved
SNDK moved ahead of its introduction into the S&P 100 index and the overall hype around the digital flash drive and memory chips. The company was fueled by the recent AI growth media and as the stock experienced heavy volatility earlier in the past couple weeks, surged on AI slowdown fears +11% during market hours on Friday September 18.
Bullish Case
Sandisk Corporation is nearing its scheduled promotion to the S&P 100 index before the market opens September 21 as Nike leaves it. This sector of semi-conductors is experiencing high demand currently along with AI memory needs and the shortage of supply in the manufactures of AI memory chips.
Bearish Case
Associative companies NAND and DRAM, both notable AI memory creators might lose momentum and have peaked. With recent news about AI getting out of control, this might mean the slow down in production of these big name companies associated with AI infrastructure.
Written by Trevor
Why It Moved
The U.S. Treasury announced they were doubling the bond buybacks, which meant more money was being circulated. This reduces the value of cash, so cryptocurrency becomes more valuable. As a result, BTC surpassed the $80,000 mark, which resulted in Coinbase spiking. Also, the SEC allowed certain venues to trade tokenized stocks, adding more to what Coinbase can already sell.
Bullish Case
The market share for Coinbase has increased each quarter. There has also been news that a lot of investors are diverting from Bitcoin spending, meaning a Bitcoin crash does not necessarily equal a Coinbase crash.
Bearish Case
The cryptocurrency market has always been one of the most volatile due to the limited supply and low liquidity. There is also still a heavy reliance on cryptocurrency, even though the company has diverted some money into other assets. If cryptocurrency hits another wall, Coinbase will be one of the first companies to fall with it.
Written by Terry
Why It Moved
SPYM moved up about 0.10% on Friday, September 18. SPYM follows the S&P 500, so its price is affected by the overall stock market. The S&P 500 also gained about 0.2% that day as investors reacted to changing oil prices, bond yields, and interest-rate concerns.
Bullish Case
SPYM gives investors exposure to about 500 large U.S. companies in one ETF. Its biggest holdings include Nvidia, Apple, Microsoft, and Amazon, so it can benefit when major U.S. companies continue to grow. It also has a very low 0.02% expense ratio, which makes it relatively inexpensive to hold.
Bearish Case
Because SPYM follows the S&P 500, it is still affected by major market problems. Higher interest rates, inflation, and expensive oil can put pressure on stocks and cause SPYM to fall. SPYM is also heavily weighted toward technology, with about 38% of the fund invested in that sector, so a major technology slowdown could have a noticeable effect.
Written by Samuel
Why It Moved
META fell 2.43% on Friday, but it's still up over 20% during the last month. With the development of AI, it serves as the catalyst for why the stock has been moving. With lower building costs, customs AI chips, and a cloud database, META has revolutionized the AI industry as a whole. Moreover, META's core apps have nearly 3.5 billion concurrent users on a daily basis. META is a reliable and intuitive company that continues to break expectations.
Bullish Case
META implementation of AI leads to strong earnings and growth, something other AI dominant companies lack. META was also able to boost AI user engagement by 60%. Aside from AI, META owns major social media apps such as Facebook and Instagram. META also develops technology such as the Meta Ray-Ban smart glasses. Their diverse, yet precise range of products allow them to stand out compared to competition.
Bearish Case
Similar to most AI companies, META has debt, specifically $83.66 billion. Their Q2 free cash flow also fell 91%, with the main cause being their AI scaling investments. Furthermore, they face scandals relating to their social media apps. Legislatures are trying to stop teenagers from using such apps because of their addictive tendencies. With heavy AI investments and scandals, META's speculation is indeed justified and it's up to the buyer if they're willing to take the risk.
Written by Janick