U.S. equity markets are experiencing a volatile start to the week this Monday, February 23rd, 2026, as investors grapple with a rapid escalation in trade policy tensions. Midday trading shows a definitive shift toward a "risk-off" sentiment, with major indexes retreating from recent highs. The primary catalyst for today’s downward momentum is the White House’s announcement of a new 15% global tariff on all imports, a move that follows a landmark Supreme Court ruling on Friday which had briefly struck down p ...

Core Insights - The investment environment in February 2026 shows a divide between institutional caution and investor optimism, with warnings about structural risks in global markets [2] - Bill Ackman disclosed a $2 billion position in Meta Platforms, indicating continued investment interest in U.S. technology despite market disappointments [3] - Reddit discussions have highlighted the top 10 stocks to buy in 2026, reflecting investor sentiment and interest [3][4] Company Analysis - AST SpaceMobile, Inc. (NASDAQ:ASTS) is among the top 10 stocks to buy in 2026 according to Reddit, with 25 hedge fund holders [9] - The company completed a $1 billion private offering of 2.25% convertible senior notes due 2036, generating approximately $983.7 million to strengthen its balance sheet and fund expansion initiatives [10] - AST SpaceMobile aims to optimize its capital structure through share offerings and convertible note repurchases to reduce high-cost debt [10] - The company's price target was lowered from $105 to $95 by B. Riley analyst Mike Crawford, who noted a 15% share decline due to a sector-wide slump, although the balance sheet was strengthened to $2.78 billion [11] - Founded in 2017, AST SpaceMobile is developing the first space-based cellular broadband network designed to connect directly to standard smartphones [12]

Economic Overview - The U.S. economy added 130,000 nonfarm payrolls in January, significantly exceeding expectations of 70,000, with private employers contributing 172,000 jobs, marking the strongest gain since December 2024 [2] - The unemployment rate decreased to 4.3% from 4.4%, indicating a positive trend despite a downward revision of 898,000 jobs in prior payroll estimates [3] - Consumer prices rose 2.4% year over year in January, down from 2.7% and below forecasts of 2.5%, representing the lowest inflation reading in eight months [4] Inflation and Interest Rates - Core inflation eased to 2.5%, the lowest since March 2021, suggesting potential for additional interest-rate cuts, with markets pricing in at least two reductions by year-end [4] Technology Sector Challenges - The tech industry is facing higher costs for memory and storage products due to a global supply crunch, raising concerns about profit compression in AI infrastructure spending [6] - In a single session, 10 tech giants lost over $500 billion in market capitalization, reflecting the impact of these cost pressures [6] Automotive Industry Insights - Ford reported a strong performance in 2025 despite facing approximately $2 billion in losses related to supplier issues and a $2 billion net tariff headwind [7] - The company incurred $15.5 billion in special charges primarily linked to scaling back electric vehicle plans announced in December [8] - Following the earnings report, Ford's shares rallied for three consecutive sessions, reaching January highs, and the CEO approved higher bonuses for 75,000 salaried employees due to improved vehicle quality [8]

Core Insights - The article discusses the best Roth IRA stocks to invest in, highlighting the growing popularity of Roth IRAs among younger investors and the significant amount of assets held in these accounts [1][2][3]. Roth IRA Overview - A Roth IRA is a tax-advantaged retirement savings account that allows individuals to control their contributions and investments directly [1]. - As of year-end 2023, Americans held $13.6 trillion in individual retirement accounts, with $1.4 trillion in Roth IRAs, indicating a substantial market presence [3]. Investor Demographics - Younger investors are increasingly opening Roth IRAs, with 34% of Roth IRA investors under 40 years old compared to only 17% of traditional IRA investors in the same age group [3]. Investment Methodology - The article outlines a methodology for selecting stocks, focusing on companies with long-term growth potential, dividend growth history, solid fundamentals, and positive analyst coverage [6]. - The selected stocks are ranked based on their popularity among hedge fund investors, with a total of 13 companies highlighted [6]. Hedge Fund Interest - The article emphasizes the strategy of mimicking top hedge fund stock picks, which has historically outperformed the market, with a reported return of 427.7% since May 2014 [7]. Company Highlights - **PepsiCo, Inc. (NASDAQ:PEP)**: Barclays raised its price target from $148 to $160 following the company's earnings report, with a focus on affordability for low- and middle-income consumers [9][10]. The company is implementing pricing strategies and marketing pushes for brands like Gatorade and Quaker [12][14]. - **Cisco Systems, Inc. (NASDAQ:CSCO)**: Introduced a new chip designed to enhance data movement in large data centers, positioning itself in the competitive AI infrastructure market projected at $600 billion [15]. The new chip is expected to improve AI computing tasks by 28% and is manufactured using advanced 3-nanometer technology [17][18].

Core Insights - Small-cap stocks provide the highest long-term returns among major asset classes but often receive little attention from investors, especially when large-cap tech dominates the market [2] - The Vanguard Russell 2000 Index Fund ETF Shares (VTWO) offers diversified small-cap exposure at a very low cost, making it an attractive option for investors [2][3] Small-Cap Diversification Role - VTWO tracks the Russell 2000 Index, comprising over 700 smaller U.S. companies, providing broad diversification at an annual cost of just 0.07%, one of the lowest in the small-cap category [3][7] - The fund has $14.5 billion in assets, balancing liquidity with tight index tracking, making it accessible for various investors [3] - VTWO's exposure to small-cap stocks comes from companies in their growth phase, with diversification across sectors like healthcare, industrials, financials, and technology, ensuring no single holding exceeds 2% of the portfolio [4] Performance Reality Check - Small-cap stocks have faced challenges in recent years, with VTWO's 17.32% gain over the past year lagging behind the large-cap tech rally driven by AI infrastructure spending [5] - Over ten years, VTWO returned 218.63%, significantly underperforming the NASDAQ-100, which surpassed 500% [5][7] - This underperformance is attributed to small caps' structural sensitivity to the rising interest rate environment that began in 2022 [5] Cost Efficiency and Performance - VTWO tracks its benchmark with minimal slippage due to its low expense ratio, with a five-year return of 28.01% showcasing the compounding benefits of Vanguard's cost advantage [6] - Compared to the iShares Russell 2000 ETF (IWM), VTWO's lower fees result in measurable outperformance over time, emphasizing the importance of cost in long-term index tracking [6]

Alphabet Trade - Alphabet purchased 67,630 shares valued at approximately $22.4 million, based on a closing price of $331.33 [1] - The purchase follows strong fourth-quarter earnings, particularly in Google Search and Cloud segments [1] - Growth in these segments was driven by the strength of Gemini, as highlighted in the report [1] AMD Trade - ARK Next Generation Internet ETF acquired 20,189 shares of AMD, valued at approximately $3.9 million at a closing price of $192.50 [2] - This acquisition occurred amid a recent stock decline for AMD, attributed to high expectations and a one-time sales surge to China [2] - Despite record fourth-quarter revenue, AMD's forward guidance has made some investors cautious [2] Broadcom Trade - ARKQ and ARKW acquired a combined 87,148 shares of Broadcom, valued at approximately $27.06 million at a closing price of $310.51 [3] - Broadcom's stock rose due to optimism around AI infrastructure spending [3] - Increased capital expenditure outlook from Alphabet further fueled this optimism [3] Qualcomm Trade - ARKQ and ARKW sold a total of 228,943 shares of Qualcomm, valued at approximately $31.2 million based on a closing price of $136.30 [4] Other Key Trades - Google's Class C stock has a Value in the 27th percentile and a Momentum in the 93rd percentile according to Benzinga Edge Stock Rankings [5]

Summary of Key Points from the Conference Call Industry and Companies Involved - **Industry**: Hardware & Networking, specifically focusing on Cloud Capital Expenditures (Capex) - **Companies**: Meta Platforms Inc (META), Microsoft (MSFT) Core Insights and Arguments - **Capex Growth Trends**: - Meta and Microsoft reported strong capex trends for the December quarter, with aggregate capex increasing by +10% quarter-over-quarter and +60% year-over-year to $60 billion [1] - Both companies expect significant capex growth in their respective fiscal years, with guidance for increases exceeding +$50 billion year-over-year and growth rates above +60% [1] - **Meta's Capex Outlook**: - Meta's capex for Q4 2025 rose by +14% quarter-over-quarter and +49% year-over-year to $22 billion, driven by investments in data centers, servers, and network infrastructure [3] - For 2026, Meta is guiding a full-year capex outlook of $115-$135 billion, indicating a year-over-year growth of nearly +75% at the midpoint, translating to an increase of approximately +$55 billion compared to 2025 [3] - **Microsoft's Capex Outlook**: - Microsoft’s capex is projected to grow by more than +60% year-over-year in FY26, with Q2 FY26 capex rising +7% quarter-over-quarter and +66% year-over-year to $38 billion [3] - The majority of Microsoft's spending is focused on short-lived assets, including GPUs and CPUs, with significant investments in data center capacity, including nearly 1 gigawatt added in Q2 FY26 [3] - Microsoft anticipates a sequential decline in capex heading into Q3 FY26, but year-over-year growth is still expected to be +65%, equating to an increase of +$14 billion [3] Additional Important Information - **Positive Tailwinds for Related Companies**: The strong capex growth from Meta and Microsoft is expected to benefit companies in the coverage universe that are leveraged to AI infrastructure spending, including Amphenol, Arista, Celestica, Ciena, Coherent, Fabrinet, Flex, Jabil, and Lumentum [1] - **Analyst Coverage**: The report is produced by J.P. Morgan Securities LLC, with analysts Samik Chatterjee, Joseph Cardoso, Manmohanpreet Singh, and Marc Vitenzon involved in the analysis [2] This summary encapsulates the key points from the conference call, highlighting the robust capex growth expectations for Meta and Microsoft, along with the implications for related companies in the industry.

Market Overview - Major indexes closed higher on Thursday, influenced by a -40 basis-point decline in the Inflation Rate from the CPI report, marking the first decline since early this year [1] - Pre-market futures are fluctuating, with the Dow down 7 points, S&P 500 up 6 points, Nasdaq up 56 points, and Russell 2000 up 6 points [2] - The day is characterized as Quadruple Witching, which may lead to increased volatility due to the expiration of futures and options [2] Santa Claus Rally Potential - Despite recent gains, indexes are down over the past week, with concerns about AI infrastructure spending affecting tech stocks [3] - The "Santa Claus Rally" typically occurs in the last trading days of the year, often correcting earlier trading discrepancies and looking forward to new year opportunities [4] - Current market conditions suggest a favorable environment for a potential Santa Claus Rally [4] Earnings Reports - Nike (NKE) and FedEx (FDX) reported better-than-expected earnings but saw stock declines due to external challenges, including weakness in China and tariff impacts [5] - Winnebago (WGO) surprised with a +216% positive earnings surprise, reporting $0.38 per share and $702.7 million in revenues, leading to a 16% increase in shares [6] - Lamb Weston (LW) beat earnings estimates but faced a 15% drop in shares due to flat sales in North America and uncertainties from international acquisitions [8] - Conagra (CAG) reported earnings slightly above estimates but is down marginally after a significant year-to-date decline of 35% [8]

Summary of Semiconductor Industry Conference Call Industry Overview - The focus is on the **Semiconductor** industry, particularly in relation to **AI infrastructure** and **analog recovery** in 2026 [1][10] - Continued momentum in **AI spending** among hyperscalers is expected to drive growth in **Digital, Memory, Storage, and SPE stocks** [1][10] Key Themes and Insights AI Infrastructure Spending - AI infrastructure builds are projected to sustain high **CapEx levels**, benefiting **Semiconductors** and **EDA** [2] - A "barbell" approach is anticipated, balancing leading-edge AI model training with lower-cost inference [2] - Increased scrutiny on monetization and value creation from AI spending is expected, particularly for companies like **OpenAI** which may require ~$75 billion in external financing in 2026 [17][30] Stock Performance Discrimination - Discrimination in **Semiconductor stocks** is expected, with leading customer mixes likely to outperform [3][37] - Companies closely aligned with successful AI models, such as **Broadcom** and **Nvidia**, are expected to perform better than those with less exposure [37][41] Analog Recovery - The **analog semiconductor industry** is in the early stages of a cyclical recovery, with expectations of improved fundamentals and inventory normalization [4][51] - Demand in key markets like **Automotive** and **Industrial** is stabilizing, with analog units currently ~1% below trend [56][63] Wafer Fabrication Equipment (WFE) - Sustained growth in **WFE** is anticipated through 2027, with a 2026 estimate raised to **11% YoY** due to AI spending trends [4][10] Company Ratings and Recommendations Upgrades and Downgrades - **Broadcom**: Upgraded to Buy; expected to leverage scale in networking and custom silicon [12] - **Nvidia**: Upgraded to Buy; anticipated to benefit from ongoing infrastructure build-out [12] - **Teradyne**: Upgraded to Buy; expected to gain traction in GPU testing [7] - **ARM Holdings**: Downgraded to Sell; limited leverage to the AI cycle [7] - **Texas Instruments**: Downgraded to Sell; lackluster execution noted [7] - **Entegris**: Downgraded to Sell; poorly positioned to capture upside [7] Financial Projections - **Nvidia**: Projected revenue for 2026 is **$382.87 billion**, with EPS increasing from **$4.49 to $8.75** [15] - **Broadcom**: Expected revenue growth from **$69.19 billion to $107.95 billion** in 2026 [15] - **Analog Devices**: Anticipated revenue growth from **$11.75 billion to $13.69 billion** [15] Additional Insights - **Geopolitical tensions** between the US and China are noted as a downside risk, particularly in AI models and accelerators [32] - **Technological advancements** in networking are expected, with **Broadcom** positioned to benefit from these changes [31] - The **MCU industry** is lagging in recovery, currently **27% below trend**, while analog units are showing signs of improvement [58][63] Conclusion - The semiconductor industry is poised for growth driven by AI infrastructure spending and a gradual recovery in analog markets. Key players like **Broadcom** and **Nvidia** are expected to lead, while companies with less exposure to AI may face challenges. Investors should monitor the evolving landscape for opportunities and risks associated with funding and technological advancements.

Market Overview - Pre-market futures are flat, with the Dow up +110 points and the Russell 2000 up +2 points, while the Nasdaq is down -103 points and the S&P 500 down -2 points [1] Company Insights - Broadcom's CEO Hock Tan expressed concerns about lower-than-expected AI product orders for the next year, leading to a -5% drop in the company's stock despite a robust earnings report [2] Economic Indicators - The upcoming Employment Situation report from the U.S. Bureau of Labor Statistics (BLS) is highly anticipated, with the last report showing +119K new jobs created in September and an unemployment rate of +4.4% [3][4] - The average monthly job creation over the last four months is only +44K, indicating a decline in the labor market, which is insufficient to offset retirements [4][5] - The Consumer Price Index (CPI) report for November is also awaited, with the last recorded inflation rate at +3.0%, marking a significant point in the economic narrative [6][7] - The trend in inflation rates shows a pattern of lower highs and lower lows, with the most recent high at +3.0% in September 2023 [7] - The upcoming data is crucial as it may influence the Federal Reserve's decisions, with uncertainty surrounding economic direction as GDP growth and inflation rates are projected positively through 2026 [8]