Group 1: Core Comparison between Microsoft and Alphabet - Microsoft and Alphabet have both significantly increased investor wealth, but Alphabet is viewed as the more promising stock for new investors [1] - Microsoft is experiencing challenges in the AI sector, particularly with its AI-powered personal assistant, Copilot, which has only attracted 15 million subscribers out of 450 million potential users [4][5] - Microsoft's cloud computing business, while still profitable, is reportedly losing market share despite revenue growth, indicating that simply growing revenue is insufficient in a competitive environment [7] Group 2: Alphabet's Strengths - Alphabet's Google Cloud business has seen a record-breaking growth, achieving a 21% share of worldwide cloud computing revenue in the fourth quarter of the previous year [9] - Google's AI technologies, including Gemini, are gaining significant traction, with Gemini accounting for about one-fifth of user requests in the AI-powered chat assistant market, while ChatGPT dominates with nearly two-thirds market share [6]

You get Bill's daily "live" buys and sells in his four portfolios: Emerging Growth, Ultra-Growth, Premier Growth, and Dividend & Growth. Our Ultra-Growth portfolio has tripled the returns of the S&P 500 since its 1/1/2019 inception, while our Premier Growth portfolio has doubled the returns of the market during that same time-period.It’s dominated enterprise software for over 30 years, with the near monopoly that was Microsoft Office. Its partnership with OpenAI has it currently sitting atBill Gunderson is ...

Group 1 - The Ultra-Growth portfolio has tripled the returns of the S&P 500 since its inception on January 1, 2019, while the Premier Growth portfolio has doubled the market returns during the same period [1] - The company has been a dominant player in enterprise software for over 30 years, particularly with its near monopoly on Microsoft Office [1] - The partnership with OpenAI positions the company favorably in the current market landscape [1] Group 2 - Bill Gunderson is the CEO and Chief Market Strategist at Gunderson Capital, with over 24 years of experience in professional money management and research analysis [1] - The investing group Best Stocks Now! Premium offers daily market commentary, live buy and sell signals, and access to a proprietary app created by Bill Gunderson [1]

Market Overview - The Dow is experiencing gains, aiming for a third consecutive record close, while the S&P 500 and NASDAQ show mixed performance with slight declines [1][2][8]. - The S&P 500 equal-weighted index and small-cap indices like the S&P 600 are reaching record highs, indicating strong performance in broader market segments [3]. - Bond yields are decreasing, with the 10-year yield down to 4.14% and the 30-year yield at 4.79%, suggesting a shift in investor sentiment towards bonds [4]. Sector Performance - Utilities and real estate sectors are leading the market, with utilities up approximately 2.3% and real estate up about 1.5%, reflecting their sensitivity to interest rates [5]. - Financials, technology, and healthcare sectors are underperforming, indicating a potential shift in investor focus away from these areas [5][6]. AI and Technology Insights - The AI sector is entering a new phase, with companies increasingly relying on debt for capital expenditures rather than free cash flow, as seen in major firms like Google and Amazon [9][10]. - Investors are currently accepting of big tech companies taking on debt to finance AI developments, but there is a growing concern about the return on investment (ROI) and whether these expenditures will yield positive results in the future [12][14]. - The competitive landscape in AI is evolving, with uncertainty about which companies will emerge as leaders, prompting a cautious approach from investors [16][17]. Alphabet's Bond Offering - Alphabet is raising approximately $32 billion through multiple bond deals, including a rare 100-year bond, to finance its AI infrastructure buildout despite having substantial cash reserves [20][21]. - The demand for long-term bonds from companies like Alphabet indicates a shift in investment strategies, with institutional investors seeking stable, long-term returns [21]. Tax Implications for Big Tech - Major tech companies like Amazon and Meta are projected to see significant reductions in their tax bills for 2025, attributed to favorable tax provisions and credits related to AI investments and capital expenditures [22][23]. - This reduction in tax liabilities is expected to positively impact their bottom lines, although it may attract public scrutiny regarding their tax practices [23]. Job Market and Economic Outlook - The upcoming jobs report is anticipated to show a modest increase in employment, with projections around 70,000 new jobs added, but the White House is preparing for potential criticism if the numbers fall short of expectations [22][23]. - The labor market is described as stable, with sluggish hiring but no significant increase in layoffs, indicating a cautious economic environment [22].

Group 1 - U.S. stock futures are trading higher, indicating a positive market sentiment for the day [1] - Microsoft Corp. is expected to report quarterly earnings of $3.97 per share on revenue of $80.27 billion, with shares rising 0.4% to $482.50 in after-hours trading [1] - Packaging Corp Of America reported weaker-than-expected fourth-quarter results, projecting first-quarter GAAP EPS of $2.20, below market estimates of $2.26, leading to a 2.1% decline in shares to $218.99 [1] - Tesla Inc. is anticipated to post quarterly earnings of 45 cents per share on revenue of $24.78 billion, with shares increasing 0.4% to $432.49 in after-hours trading [1] - Starbucks Corp. is projected to report quarterly earnings of 59 cents per share on revenue of $9.73 billion, with shares slipping 0.1% to $95.70 in after-hours trading [1] - AT&T Inc. is expected to report quarterly earnings of 46 cents per share on revenue of $32.87 billion, with shares rising 0.3% to $23.07 in after-hours trading [1]

Investment management company Vulcan Value Partners recently released its fourth-quarter 2025 investor letter. A copy of the letter can be downloaded here. All the strategies of Vulcan Value Partners delivered positive results in the year. The Large Cap Composite (Net) returned -1.5% in Q4 and 7.9% YTD, the Small Cap Composite (Net) gained 3.2% in Q4 and 9.5% YTD, The Focus Composite (Net) retuned 0.1% in Q4 and 7.1% YTD, Focus Plus Composite (Net) returned 0.1% in Q4 and 6.2% YTD and the All-Cap Composite ...

Core Insights - Excel is poised to become a high-value area similar to Coding, with the potential for rapid growth driven by its large market size and self-serve adoption model [1][2]. Group 1: Market Potential - The global monthly active users (MAU) for spreadsheets is estimated to be around 1.5 to 1.6 billion [1][22]. - The software industry is valued at approximately $1 trillion, with application software potentially accounting for about 50% of this market [23]. - Excel's total addressable market (TAM) is significantly large, as many software applications can be viewed as "Excel wrappers" [17][23]. Group 2: Adoption and Growth Model - Excel can extend into various sectors such as finance, operations, and analytics, allowing for a broad range of applications [1][17]. - The self-serve adoption model enables users to quickly integrate and utilize Excel without extensive marketing efforts [2][17]. - The financial sector is identified as a natural entry point for Excel's expansion due to high profitability and a strong willingness to invest in productivity tools [24]. Group 3: Competitive Landscape - Major players like OpenAI and Anthropic are actively entering the spreadsheet and productivity workflow space, indicating a competitive environment [2]. - The success of Coding has demonstrated the potential for rapid growth in self-serve tools, suggesting that Excel could follow a similar trajectory [24].

Core Insights - Altimeter Capital's partner Freda Duan highlights that while programming is currently the strongest AI application vertical, Excel has the potential to become the next "super vertical" in AI due to its billion-user scale [1] - Major industry players like OpenAI and Anthropic are actively expanding into the spreadsheet and productivity workflow sectors, indicating a significant shift in focus [1] - The potential market size for spreadsheets is larger than that of programming, and their unique characteristics as an "application software encapsulation layer" could reshape the entire software industry [1] Market Analysis - The programming sector has produced four companies with annual recurring revenue (ARR) exceeding $1 billion, with at least seven others rapidly surpassing $100 million ARR, suggesting a strong growth model that Excel could replicate [1] - The programming market is estimated to have a total addressable market (TAM) of approximately $2 trillion, with a natural advantage in adjacent use cases and a product-driven go-to-market strategy [6] - Excel's user base is substantial, with over 1.1 million paid customers reported by Google Workspace and an estimated 1.5 billion active users globally, indicating a massive potential market [8] Strategic Implications - The financial sector is identified as a key entry point for AI-driven Excel tools, given its high per capita profit and willingness to pay for productivity tools [9] - Approximately 10% of the 1.5 billion Excel users belong to the financial sector, which includes over 6.7 million professionals in the U.S. financial services and insurance industry, providing an excellent initial market for AI applications [9] - The self-service and workflow-native nature of tools in this space could lead to faster expansion compared to other software categories, as evidenced by the programming sector [9]

Core Insights - The article posits that Excel may become the next high-value area to experience rapid growth, similar to Coding, due to its large market potential and self-serve adoption model [2][3][4] Group 1: Market Potential - Excel has a global monthly active user base of approximately 1.5 to 1.6 billion, indicating a vast total addressable market (TAM) [14][19] - The software industry is estimated to be around $1 trillion, with application software potentially accounting for about 50% of that, much of which can be seen as "Excel wrappers" [20] - The TAM for Coding is recognized to be around $2 trillion, showcasing the potential for Excel to tap into a similarly large market [7] Group 2: Adoption and Growth Model - Excel's adoption can largely rely on self-serve mechanisms, allowing users to quickly integrate and utilize the tool without extensive marketing efforts [4][13] - The financial sector is identified as a natural entry point for Excel's expansion, given the high profitability and willingness to invest in productivity tools among financial professionals [21][22] Group 3: Comparison with Coding - Both Excel and Coding share characteristics such as a large TAM, the ability to extend into adjacent use cases, and limited go-to-market costs due to self-serve adoption [13] - Coding has demonstrated explosive growth, and Excel is positioned to follow a similar trajectory, potentially even on a larger scale [3][6]

Core Viewpoint - Microsoft is experiencing a stock price decline of 15%, but the company is executing well and is expected to show significant returns on its investments in AI and data centers in the future [2][4]. Company Performance - Despite the recent stock decline, Microsoft is considered one of the best-executing companies globally, with a strong historical ability to compete and win in the market [2][4]. - The competitive landscape is challenging, particularly with Google’s cloud services outperforming Microsoft in web visits, which is a proxy for service engagement [3]. Market Sentiment - Current sentiment around Microsoft is positive, with expectations for a strong performance as the company continues to invest in AI and data centers [2][4][5]. - The recent stock pullback is viewed as a healthy correction, providing a potential entry point for long-term investors [7][8]. Earnings Outlook - Analysts are generally bullish on Microsoft ahead of its upcoming earnings report, although there has been some rerating of the stock price [9][10]. - The earnings report is seen as an opportunity to gain insights into the company's future direction, particularly regarding capital expenditures and AI investments [11][12]. Capital Expenditure Insights - Investors are keen to hear about Microsoft's capital expenditure plans, especially in relation to its $13 billion investment in OpenAI, which has significantly increased in value [12][13]. - Clarity on capital expenditures could serve as a catalyst for stock price movement, with potential for a significant rebound if the company indicates confidence in its spending strategy [13][14].