Amid the resounding bearishness that is upending the AI trade, investors should look to portfolio rotation to protect themselves from possible further downside in the S&P 500. In my view, the best way to achieve this is to emphasize “growth at a reasonable price” inWith combined experience of covering technology companies on Wall Street and working in Silicon Valley, and serving as an outside adviser to several seed-round startups, Gary Alexander has exposure to many of the themes shaping the industry today ...

Group 1 - Texas Instruments Incorporated (NASDAQ: TXN) has experienced an 8.3% decline since July 24, underperforming the S&P 500 during the same period [1] - The analyst's previous thesis focused on the semiconductor sector, emphasizing the importance of investing in companies within oligopolistic markets with high barriers to entry [1] - The analyst has a background in mechanical engineering and has shifted from the oil and gas sector to focus on global equities, particularly in semiconductors, robotics, and energy [1] Group 2 - The investment approach highlighted is centered on growth at a reasonable price, with a mid- to long-term investment horizon [1] - The analyst has no current positions in any of the companies mentioned and does not plan to initiate any positions within the next 72 hours [1]

Market Overview - President Trump's recent comments on trade relations with China have led to a rebound in the stock market, with futures indicating a strong opening after a significant sell-off that wiped out over $2 trillion in market value on Friday [2][5][17] - The Nasdaq and S&P 500 are leading the market recovery, but Morgan Stanley warns of a potential 11% decline if trade tensions escalate [3][19] Trade Relations - Trump's softened stance on China, stating "don't worry about China, it'll all be fine," contrasts with his previous threats of imposing a 100% tariff on Chinese goods [5][8] - Recent actions from China, including export controls on rare earths and new port fees on US ships, have heightened trade tensions [9][11] Banking Sector - Major banks, including JP Morgan, are expected to report strong earnings due to increased deal-making and trading activity [4][26] - JP Morgan announced a $10 billion initiative to invest in critical industries over the next decade, focusing on sectors like energy and technology [22][24] Rare Earth Minerals - Companies involved in rare earth minerals, such as MP Materials, are experiencing stock price increases due to tightened export controls from China [35] - MP Materials, the largest rare earth producer in the Western Hemisphere, has seen its shares rise over 400% this year [35] AI and Technology - Broadcom's shares surged following a multi-year agreement with OpenAI to collaborate on custom chips and networking equipment, aiming to enhance AI data center capacity [30][31] - OpenAI's partnerships with various tech companies, including Nvidia and AMD, highlight the growing demand for advanced computing infrastructure [32] Earnings Expectations - Upcoming earnings reports from major banks are anticipated to reflect strong performance, with a focus on consumer and commercial credit scrutiny due to recent economic conditions [27][28] - Analysts are closely monitoring the impact of recent automotive bankruptcies on the credit environment for banks [28]

Core Viewpoint - The article emphasizes the investment strategy of "growth at a reasonable price," highlighting the potential for investors to find value and growth opportunities, particularly in Real Estate Investment Trusts (REITs) that are currently undervalued in the market [1]. Group 1: Investment Strategy - The investment approach focuses on identifying REITs that are temporarily out-of-favor, suggesting a contrarian strategy that seeks deep-value opportunities [1]. - The investment horizon is long-term, indicating a preference for holding investments over an extended period to realize intrinsic value [1]. Group 2: Background of the Analyst - The analyst is an economics teacher from the Netherlands with a strong passion for income investing, which adds credibility to the insights provided [1]. - The investment journey began during the COVID-19 pandemic, suggesting a response to market volatility and the search for stable income sources [1].

Market Trends & Digital Economy - The digital economy is accelerating despite economic fears [1] - AI spend continues to build momentum in both enterprise and consumer computing [2] - Strength in the digital economy and AI economy will outweigh volatility in the long term [10] Amazon's Performance & AWS - AWS revenue slightly disappointed relative to Google Cloud and Microsoft Azure's reacceleration [4] - Investors wanted more explicit language about supply unlocking revenue reacceleration in AI from Amazon [4][5] - There's a need for more examination of growth rates between Microsoft, Google Cloud, and AWS, considering different revenue exposures [6] Investment Opportunities & Risk Assessment - Goldman Sachs views Amazon as a disproportionate risk-reward opportunity at current levels [7] - Amazon's commerce business accelerated, margins improved, and the advertising business accelerated [7] - Goldman Sachs estimates Amazon's gap earnings at $8+ in 2026 and $10+ in 2027, presenting a cheap compounding growth story [7] - Mega Cap Tech is finding a home in "Garpy" (growth at a reasonable price) [9]

Group 1 - Texas Instruments Incorporated (NASDAQ: TXN) was rated as a Hold in the previous quarter due to concerns about the durability of recovery in analog demand despite signs of improvement in Q1 results [1] - The analyst has a background in Mechanical Engineering and has transitioned from the oil and gas sector to focus on global equities, particularly in the semiconductor industry [1] - The investment approach emphasizes growth at a reasonable price with a mid- to long-term investment horizon, focusing on companies in oligopolistic sectors with high barriers to entry [1] Group 2 - The analyst has no current stock or derivative positions in any mentioned companies and does not plan to initiate any positions within the next 72 hours [1]

Group 1 - The current stock market environment emphasizes the importance of selective stock-picking, with a focus on reallocating investments towards cash/bonds, international stocks, and "growth at a reasonable price" companies [1] Group 2 - Gary Alexander has extensive experience in the technology sector, having worked on Wall Street and in Silicon Valley, and has been advising seed-round startups, which provides him with insights into current industry trends [2]

Core Insights - The S&P 500 is reaching new highs despite significant macroeconomic and geopolitical risks, indicating a potential shift in investor focus towards value stocks, particularly "growth at a reasonable price" stocks for the remainder of 2025 [1] Group 1 - Investors are encouraged to rotate portfolios into value names as a key priority moving forward [1] - The experience of industry experts, such as Gary Alexander, highlights the importance of understanding current market themes and trends [1]

Group 1 - The article emphasizes a focus on active stock picking, particularly favoring "growth at a reasonable price" stocks that exhibit resilience against macroeconomic pullbacks [1] - The number of such resilient stocks is decreasing, indicating a challenging environment for investors seeking these opportunities [1] - The author has extensive experience in the technology sector, having worked on Wall Street and in Silicon Valley, which informs their perspective on current industry trends [1] Group 2 - The author has been a contributor to Seeking Alpha since 2017 and has been quoted in various web publications, indicating a recognized presence in the investment community [1] - The article highlights the author's role as an adviser to seed-round startups, suggesting a connection to emerging trends and innovations within the technology industry [1]

Group 1 - The stock market is experiencing a surge due to optimism surrounding a potential U.S.-China trade deal, prompting a shift in investment focus towards value and "growth at a reasonable price" strategies [1] - Valuation multiples for many large-cap companies appear to be stretched, indicating a potential overvaluation in the market [1] - The analyst has extensive experience in covering technology companies and has been involved with startups, providing insights into current industry trends [1] Group 2 - The analyst has been a contributor to Seeking Alpha since 2017 and has been featured in various web publications, indicating a recognized presence in the investment community [1]