Core Insights - SGA's Emerging Markets Growth Strategy experienced a divergence from the market in Q4 2025, with the portfolio returning 0.8% (Gross) and 0.6% (Net), compared to MSCI EM Net TR Index return of 4.7% and MSCI EM Growth Net TR Index return of 3.3% [1] - For the full year 2025, the portfolio achieved returns of 23.8% (Gross) and 22.8% (Net), lagging behind the indexes which returned 33.6% and 34.3% respectively [1] - The portfolio anticipates annual revenue growth of 13% and earnings growth of 16% over the next three years [1] Company Focus: Alibaba Group Holding Limited - Alibaba Group Holding Limited (NYSE:BABA) was highlighted as a detractor in Q4 2025 due to mixed fiscal Q2 results, with core commerce facing slowing growth and profit pressure [3] - The company reported a one-month return of -3.87% and a 12-month increase of 37.46%, with a market capitalization of $392.286 billion as of February 11, 2026 [2] - Alibaba's cloud revenue growth accelerated, and management's strategy in quick commerce aims to enhance market share despite initial profit pressures, leveraging its user base and ecosystem assets [3] - Ongoing investments in AI and cloud infrastructure are expected to increase, with a focus on sustaining market share in quick commerce and food delivery services [3] - The company is projected to achieve high-teens earnings growth over the next three years, supported by its scale and innovation in China's digital economy [3]

Group 1 - The software as a service sector experienced significant selling pressure, but a short squeeze occurred by the end of the week, suggesting a potential recovery for investors [1] - Concerns about disruption in software companies are countered by the view that advancements are empowering these companies and improving coding efficiency [2] - The software sector presents investment opportunities, particularly in cloud infrastructure and subsectors like cyber defense, which may contribute to a broader rally in US stock markets [3] Group 2 - The macroeconomic data for 2025 has exceeded expectations, leading to an upgraded outlook for global growth in 2026, which is favorable for various sectors, particularly materials [5] - The materials sector, especially metals, is highlighted as a strong investment opportunity alongside healthcare, indicating a positive earnings trend across multiple sectors [6] - European equities are facing a mixed outlook, heavily reliant on financials and industrials, with analysts downgrading profit estimates more frequently than upgrading [7][8] Group 3 - Asian markets, particularly Japan, are showing positive surprises, supported by political clarity regarding economic policy, which bodes well for continued earnings growth [9]

Core Viewpoint - Amazon's stock has experienced a notable decline in 2026, primarily due to a significant market sell-off linked to its ambitious capital expenditure plans, which are expected to reach around $200 billion, raising concerns about profitability and cash flow erosion [1][5][12] Financial Performance - Year-to-date, Amazon's stock is down 9.47%, and over the past 52 weeks, it has declined by approximately 10.2%, contrasting with a 14.43% gain in the S&P 500 Index [1][2] - In Q4 2025, Amazon reported net sales of $213.4 billion, a 14% year-over-year increase, while AWS generated $35.6 billion in revenue, up 24% year-over-year [8] - For the full year 2025, total net sales reached $716.9 billion, with a free cash flow contraction to roughly $11.2 billion, significantly down from prior periods due to aggressive capital expenditures [10] Capital Expenditure and Strategic Focus - Amazon's management has forecasted capital expenditures of approximately $200 billion for 2026, aimed at expanding AI data centers, custom silicon production, and robotics [11] - This aggressive spending strategy is intended to bolster Amazon's long-term position in AI and cloud leadership but has raised concerns regarding near-term profitability [12] Competitive Position and Analyst Sentiment - DA Davidson downgraded Amazon's stock from "Buy" to "Neutral," citing concerns over its competitive position in cloud computing and escalating investments to catch up with rivals like Alphabet and Microsoft [4][14] - Analysts have noted that AWS's growth rate of 24% lags behind competitors, with Google Cloud growing at 48% and Microsoft Azure at 39% [14] - Despite the downgrades, Amazon maintains a consensus "Strong Buy" rating among analysts, with an average price target of $285.91, indicating a potential upside of 39.5% [16]

Core Viewpoint - The European Commission has granted unconditional approval for Google's acquisition of Wiz, indicating no competition concerns within the European Economic Area [1] Group 1: Acquisition Details - Google's acquisition of Wiz is valued at $32 billion and was first announced in March 2025 [2] - The US Department of Justice completed its antitrust review in November 2025, removing a significant regulatory hurdle for Alphabet [3] Group 2: Wiz's Role and Market Context - Wiz specializes in cloud-native application protection, providing a platform for organizations to protect applications against cyber threats across various cloud environments [4] - The acquisition is positioned within the rapidly evolving cloud security industry, where Google and Wiz are significant players, competing with Amazon Web Services and Microsoft Azure [4] Group 3: Multi-Cloud Security Solutions - The acquisition aims to enhance Google's position in cloud security and support the use of multiple cloud platforms as AI technology advances [5] Group 4: Regulatory Investigation Findings - The European Commission's investigation assessed potential bundling of Wiz's platform with existing Google products and found sufficient alternative suppliers for customers [6] - Concerns regarding Google's access to commercially sensitive data through Wiz's integrations were addressed, concluding that such information is generally accessible and not sensitive [7] - Teresa Ribera, Executive Vice-President of the EC, stated that the investigation confirmed customers will continue to have credible alternatives and the ability to switch providers [8]

Core Viewpoint - Amazon's stock has experienced significant volatility, reaching its lowest valuation in history following the Q4 2025 earnings report, with shares down over 15% in the past month [1][3]. Valuation Analysis - Amazon's trailing price-to-earnings (P/E) ratio has dropped to approximately 29x, the lowest in its public market history, contrasting sharply with previous cycles where it often exceeded 100x [3][4]. - Historical data shows that Amazon's valuation has previously surged above 100x earnings, peaking near 350x during early growth phases and over 150x during the pandemic [4]. - The current valuation is near historical lows, last seen when Amazon was significantly smaller, indicating a potential for future multiple expansion [5][7]. Financial Performance - In Q4 2025, Amazon reported a 14% year-over-year increase in net sales to $213.4 billion, with AWS revenue rising 24% to $35.6 billion, driven by strong demand for cloud and AI services [9]. - Adjusted earnings per share were $1.95, slightly below expectations due to one-off costs [9]. Capital Expenditure Concerns - The stock has faced pressure due to guidance indicating approximately $200 billion in capital expenditures for 2026, significantly higher than 2025 levels, primarily directed towards AI infrastructure [10]. - Following the earnings report, shares fell more than 10%, leading to some analyst downgrades, although Wall Street maintains a broadly positive outlook with price targets suggesting over 30% upside [10].

Core Insights - SoFi is an online-only bank targeting younger customers who are comfortable with digital banking, reflecting the shift towards digital financial services [1][2][3] - The company, founded in 2011 and based in San Francisco, offers a range of banking services including loans, credit cards, and investment accounts [2][3] - J.P. Morgan's analysis highlights SoFi as a promising fintech stock, contrasting it with established player PayPal, which faces increasing competition [4][5] Company Overview - SoFi has approximately 13.7 million members and has funded over $73 billion in loans since its inception, with members paying off more than $34 billion in debt [6] - The company reported $1.025 billion in revenue for Q4 2025, a 40% year-over-year increase, exceeding expectations by over $30 million [7] - SoFi's adjusted EPS for Q4 2025 was $0.13, surpassing consensus estimates by two cents, and total membership grew by 35% year-over-year [7] Financial Performance - For Q1, SoFi is guiding towards a GAAP EPS of about $0.12 and adjusted revenue of around $1.04 billion, aligning with market expectations [8] - Despite a 10% decline in shares post-earnings, J.P. Morgan analyst Reginald Smith views this as an attractive entry point, citing strong user growth and deposit increases [9] - SoFi's loan portfolio is nearly $40 billion, with significant potential for fee income from its expanding financial services offerings [9] Analyst Ratings - J.P. Morgan rates SoFi shares as Overweight (Buy) with a price target of $31, indicating a potential upside of approximately 49% [10] - The consensus rating for SoFi from the Street is Hold, with 14 analyst reviews including 4 Buys, 7 Holds, and 3 Sells, and an average price target of $26.05, suggesting a 25% gain in the next 12 months [10]

Core Viewpoint - Oracle has announced an equity distribution agreement to sell up to $20 billion of its common stock, which will be executed through an at-the-market offering, allowing for gradual sales at market prices. This decision comes amid a challenging market environment for tech stocks and a significant decline in Oracle's share price this year [1][2][5]. Company Overview - Oracle Corporation is a leading global technology company specializing in cloud infrastructure, software, and hardware, with a market capitalization of $463.1 billion. It is renowned for its Oracle Database and offers a comprehensive suite of IaaS and PaaS solutions, as well as AI-powered enterprise applications [3]. Financial Strategy - The equity issuance is part of Oracle's broader financing plan for 2026, aiming to raise between $45 billion and $50 billion to support the expansion of its cloud infrastructure business. Approximately half of this amount is expected to be raised through debt [6][9]. - Oracle successfully attracted record demand for its $25 billion bond offering, with total orders reaching $129 billion, indicating strong investor interest despite concerns over debt-funded AI spending [7]. Market Reaction - Following the announcement of the equity distribution, Oracle's stock experienced a decline of 2.8% on the first day, with further drops of 3.4% and 5.2% in the subsequent days, primarily due to a broader rotation out of tech stocks [1][2]. - Analysts view the equity market tap as a strategic move to limit additional borrowing and alleviate investor concerns regarding debt, with expectations that Oracle will not issue more debt in 2026 [9]. Shareholder Impact - The equity issuance could lead to shareholder dilution, with estimates suggesting the addition of over 100 million new shares to the market. However, management believes that the dilution is justified by the potential for a larger revenue base in the future [10]. Analyst Sentiment - Despite recent challenges, Wall Street analysts maintain a largely bullish outlook on Oracle, with a consensus "Moderate Buy" rating. The average price target for Oracle stock is $300.94, indicating potential for significant upside from current levels [12].

Core Insights - Sanmina Corporation (SANM) has experienced a 26.4% increase in stock price over the past six months, outperforming the S&P 500 but lagging behind the Electronic Manufacturing Services industry's growth of 32.3% [1][9] - The company has outperformed Jabil, Inc. (JBL) but underperformed Celestica, Inc. (CLS), with Celestica showing a 38.9% increase and JBL a 6.9% increase [2] Financial Performance - In Q4 2025, Integrated Manufacturing Solutions (IMS) revenues surged 72% year over year to $2.79 billion, with a non-GAAP gross margin increase of 8.7% [4] - The Components, Products and Services (CPS) business saw a 4.33% year-over-year increase to $434 million, with a non-GAAP gross margin of 12.9% [5] - Non-GAAP operating profit increased by 40 basis points year over year due to reduced operating expenses as a percentage of revenues [6] Cash Flow and Liquidity - In Q1 fiscal 2026, Sanmina generated $178.7 million in net cash from operating activities, up from $63.9 million in the same quarter last year, with free cash flow reaching $92 million [7][9] - The current ratio at the end of Q1 fiscal 2026 was 1.70, indicating a strong position to meet short-term debt obligations [11] Growth Prospects - The company is focusing on investments in capacity and technology improvements across operations in the U.S., India, and Mexico, enhancing its competitive position in the electronics manufacturing services industry [10] - Earnings estimates for 2025 have risen by 4.36% to $10.06 per share, while estimates for 2026 have increased by 5.67% to $12.11, reflecting bullish sentiment [12] Valuation Metrics - Sanmina's shares trade at a forward price/earnings ratio of 13.52, which is lower than the industry average of 24.12 and its historical mean of 17.32, indicating a relatively attractive valuation [13] Overall Outlook - The company is benefiting from strong momentum in various end markets, with efficient capital management allowing for continued investment in growth initiatives [15]

Company Overview - Astera Labs, Inc. (NASDAQ:ALAB) is recognized as one of the top 10 growth stocks on NASDAQ for the next decade, driven by positive investor sentiment regarding its product roadmap [1] - The company specializes in semiconductor-based connectivity solutions for cloud and AI infrastructure, offering products such as the COSMOS software suite, PCIe/CXL smart DSP retimers, CXL memory connectivity controllers, and smart fabric switches [4] Product Development - Astera Labs announced significant updates to its Scorpio X-Series line, focusing on the needs of the AI infrastructure market and hyperscale data centers [1] - The updated Scorpio X-Series will feature increased radix support, allowing for a broader range of cluster sizes, enabling hyperscalers to optimize their infrastructure and workloads [2] - The series will include tailored protocols for individual hyperscale platforms, designed to eliminate integration barriers and facilitate smooth deployment [2] Advanced Capabilities - The company is introducing advanced capabilities such as in-network computing, hypercast technology, and optical connectivity, aimed at enhancing performance for data-intensive tasks [3] - In-network computing allows data to move directly from GPUs to the fabric switch, providing the flexibility needed for complex AI workloads and multi-rack deployments [3] - The Chief Business Officer emphasized the need for flexible connectivity solutions as hyperscalers scale up and deploy more complex AI workloads, indicating a larger market opportunity than initially anticipated [3]

Core Insights - Alphabet's fourth-quarter 2025 results are anticipated to show strong performance driven by growth in Search and Cloud businesses, with AI enhancements playing a significant role [2][9] Search Business - Google Search revenues are estimated at $61.27 billion, reflecting a 15.2% increase year-over-year, supported by AI-driven experiences and commercial query growth [3][6] - The adoption of AI Mode has led to a doubling of query volumes sequentially, attracting over 75 million daily active users across 40 languages, which is contributing to additional advertising inventory and monetization opportunities [5][9] Cloud Business - Google Cloud revenues are projected at $16.25 billion, indicating a 33.9% growth from the previous year, benefiting from the increasing demand for AI infrastructure and an expanding enterprise customer base [3][10] - The cloud segment is leveraging partnerships, particularly with NVIDIA, to enhance growth, with Google Cloud crossing 2 million Gemini Enterprise subscribers across 700 companies [8][9] Overall Financial Performance - The total revenue estimate for Alphabet in Q4 is $94.7 billion, suggesting a 16.02% growth compared to the same quarter last year, driven by both Search and Cloud segments [3][9]