Reward-to-Risk Ratio is Paramount to Investment SuccessTony Robbins is a famous author and life coach who coaches billionaire investor Paul Tudor Jones.  Robbins interviewed the legendary investor for his book, “Money Master the Game,” to share some of his investment advice. What Tudor Jones revealed in the book was not a holy grail for money-making but a risk-to-reward mindset that would mark a turning point in my investing career. When asked about risk, Jones said:“5:1 (risk/reward). Five-to-one means I’m ...

If you’re wondering which tech stocks to buy this month, look no further. Technology stocks continue to offer investors big growth opportunities. While the market rally is broadening out, tech stocks are still leading with outsized gains. And it is not just the mega-cap technology companies known as the Magnificent 7 where opportunities are to be found. A range of different technology stocks are providing shareholders with market beating returns.Catalysts such as artificial intelligence (AI), a rebound in o ...

Artificial intelligence (AI) breathed new life into the semiconductor industry. Reminiscent of the early days of the PC wars when chip stocks battled each other for supremacy by outdoing the latest advance by a rival, AI now has spawned new challengers to the old guard. Almost daily, they seem to offer new features and power.Nvidia (NASDAQ:NVDA) remains the AI chip stock of choice. But you don’t have to put all your eggs into one basket — or all your chips onto one wafer. There is a rapidly expanding univer ...

ARM's customers are starting to make products that are challenging Nvidia's GPU business.Nvidia (NVDA 2.49%) has been one of the best companies to be invested in over the past year. It has shot up like a rocket on the back of massive graphics processing unit (GPU) demand driven by the artificial intelligence (AI) arms race. GPUs are great for AI workloads because they allow parallel processing, making them far more powerful when crunching massive problems like AI model training.While these GPUs are incredib ...

These rapidly expanding companies could be among the biggest winners of the AI revolution.To generate robust returns in the stock market over many years, you'll need to find businesses with strong competitive positions and excellent long-term growth prospects.To assist you with your search for these fortune builders, here are two elite enterprises that are set to profit from perhaps the most powerful growth trend of all: artificial intelligence (AI).1. Arm HoldingsFrom the smallest sensors to the largest su ...

Parkev Tatevosian, CFA has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.Parkev Tatevosian is an affiliate of The Motley Fool and may be compensated for promoting its services. If you choose to subscribe through his link, he will earn some extra money that supports his channel. His opinions remain his own and are unaffected by The Motley Fool. ...

Core Insights - Arm Holdings reported strong fiscal Q4 results with a 47% year-over-year revenue increase to $928 million, driven by a 60% surge in license revenue and a 37% rise in royalty revenue [2][3] - The company is set to develop its own AI chips, with plans for a prototype by spring 2024 and mass production by fall 2025, partially funded by SoftBank [6][7] - Arm forecasts revenue growth of 18% to 27% for fiscal year 2025, with adjusted EPS expected to rise from $1.27 in fiscal 2024 to between $1.45 and $1.65 [3][4] Financial Performance - License revenue reached $414 million, while royalty revenue was $514 million, indicating strong demand for Arm's advanced CPU technology [2] - The company added four new Arm Total Access agreements, bringing the total to 31, with over half of its largest customers utilizing this subscription model [2][3] - Armv9-based chips now contribute approximately 20% of royalty revenue, up from 15% the previous year, reflecting a shift towards newer technology [3] Future Outlook - Arm anticipates revenue growth of at least 20% for fiscal years 2026 and 2027, indicating a positive long-term outlook [4] - The company trades at high valuation metrics, with a forward price-to-sales ratio over 30 and a forward P/E multiple of 75, suggesting that investors expect exceptional performance [4] AI Chip Venture - The new AI chip division aims to compete in the growing AI market, with SoftBank negotiating production capacity with semiconductor fabrication companies [6][7] - Arm's collaboration with SoftBank could provide a built-in customer base for its AI chips, although it may lead to competition with existing customers like Nvidia [7][8] - The potential spin-off of the AI chip division into SoftBank could further align the company's strategy with broader data center ambitions [6]

The AI wars are only getting more intense.When people think of artificial intelligence (AI), they gravitate to graphics processing unit (GPU) chip leader Nvidia (NVDA -1.99%)-- and rightly so. Nvidia currently has a huge lead making the chips needed for today's most advanced AI applications.But AI benefits will offer growth opportunities for lots of tech companies that haven't seen their stocks run as far and fast as Nvidia.On that note, there was big AI news this week for three tech giants, including two w ...

Investors were not impressed with the company's latest quarterly report, but they should not miss the bigger picture.Arm Holdings (ARM -3.43%) stock shot up big-time earlier this year following the release of its fiscal 2024 third-quarter results in February, which was not surprising, as management pointed out that the growing demand for artificial intelligence (AI) chips is turning out to be a catalyst for its business. However, things have been going downhill for the British chip designer since then.Arm s ...

Core Viewpoint - Arm Holdings' stock has surged 8% following its fiscal year 2024 earnings report, but investment bank Bernstein argues that buying the stock post-earnings was a mistake, labeling it as overpriced and recommending a sell [1][3]. Financial Performance - Arm's fiscal 2024 sales increased by 21% to $3.2 billion, while net income fell by 43% to $0.29 per share [2]. - The fourth quarter showed significant momentum, with revenue rising by 47% and earnings increasing from $0.00 per share to $0.21 per share year-over-year [2]. - Management has guided for approximately 22% sales growth in fiscal 2025, with non-GAAP earnings expected to grow similarly to about $1.55 per share [2]. Valuation Concerns - Bernstein noted that while Arm's guidance was considered "strong," it did not exceed expectations and lacked the "beat and raise" that investors were hoping for [3]. - The stock is trading at an extraordinary valuation of 388.5 times trailing earnings, which Bernstein argues does not justify the anticipated 22% growth rate [3]. - Bernstein has raised its price target to $92 but maintains a sell recommendation, emphasizing that Arm's stock is significantly overpriced [3].