MAJOR NEWS is Happening in the Stock Market Right Now

[00:00:00] Speaker 1: All right, guys, the market's down a little bit today. The Nasdaq is basically even with the S&P, but the Dow was down over 1%. At one point, it was down 600 points. Trump just announced the Iran ceasefire is over and said, and I'm quoting him here, he's no longer dealing with those scum. We're going to react to that. Plus, some Broadcom news, an Intel article, and a Waymo piece. But the big story today is Alibaba. It is up big while the rest of the market is struggling and we're doing a full stock analysis to find out if this thing is actually worth buying at today's price. Let's start with what's happening in the market right now. Guys, behind me is the heat map. We got a lot of red, but ironically, these are the ones holding up here. Broadcom, NVIDIA, Apple, holding up the market. Tesla down, Amazon down, Meta down, Google down, Microsoft down, incredible. A lot of stocks down, Palantir down 3%, Micron, basically even. A lot of red over here, a lot of red over here. More green in consumer defensive, which is what happens when, you know, things tend to be red the rest of the market. I love looking at the heat map because it really tells you a lot about where the selling and buying is concentrated on any given day. You know, I've said before, if this was all red, my guess is a lot of this would be green and vice versa. It's kind of playing out that way here today. But let us go check out the biggest winners and losers using our software. Oh, wow. Alibaba is up 11% today. Holy cow. Now, guys, I own Alibaba. Never own a company because I or anybody on the internet or even Warren Buffett have it. We're here to teach a process. Never here to give a stock pick. Alibaba, the Chinese Amazon, this company has been on a rollercoaster ride, 310 or so, down to 58, up to 180, 190, back down to 95, now at 109. Incredible. So, guys, I want to take a look at Alibaba. I want to analyze it and show you what I think it's worth based on my own personal assumptions. You might agree with me. You might not. But before we get onto that, let me show you a couple other articles that might be exciting to read today or look at today. Apple and Broadcom shake up the tech sector with a $30 billion deal. Apple plans to invest more than $30 billion into an extended partnership with Broadcom to produce custom chips. The agreement will enable Broadcom to expand and modernize its manufacturing facilities in Fort Collins, Colorado with a $1.5 billion investment. The deal is the largest so far under Apple's American manufacturing program and will lead to the production of over $15 billion U.S.-made chips. Broadcom is up 5.1%. As I told you guys before with this one, Apple's only up 1.1%. So kind of interesting there. Okay, let's go check out Intel right now. Intel's blockbuster year is becoming even more notable. Intel stock is trading above its 200-day moving average by the largest margin in history, surpassing the peak of the dot-com bubble. Now, the 200-day moving average is a technical analysis thing, but I will even mention, if you go look at Charlie Munger, he has a quote out there that said, actually, his is a 200-week moving average, but he talks about momentum. Michael Burry is a fan of technical analysis. You know, it's funny. We have a trading channel with Mo called Freedom Trader, and the interesting part is people will say, how can you be a value investor and a trader? Well, guys, it's like, how do I have a sports car and an SUV? They're just different ways of getting around, different ways of making money. I believe there are patterns in behaviors of stock prices. That's possible. Also believing that you can buy based on value and win in the long run. The 200-day moving average is widely considered the single most important technical indicator on Wall Street. It's calculated by averaging a stock's closing price over the past 200 trading days. So what it's saying here is Intel, the price, the difference between the price and the 200-day moving average is the widest it's ever been. That just means a parabolic rise. Because think about it this way. If you have a stock that's actually done this in price, the moving average takes some time to get there. It takes some time to get there. It might be like this. So that gap is the widest it's ever been. Because on 200 days, especially with Intel stock, it was at $25 a share 200 days ago, 200 trading days ago. That's insanity. So this is way higher than that. I don't know what the actual average is, but that's way, we can actually look it up right here. It'll probably tell us. Because look at this, look at this chart. That's the 200-day moving average. That's the 200-day moving average. Look at that. That's absurd. It's at like, what, $40 a share? Something like that. $37 a share? Look at this parabolic rise. That's going to end well. [00:04:52] Speaker ?: Isn't this how it's always supposed to be? [00:04:54] Speaker 1: Yes. [00:04:54] Speaker 2: So go ahead, Tim. Isn't this how it's always supposed to be? [00:04:57] Speaker 1: The answer to that is a sarcastic yes. It's clearly not. Guys, I also own an Intel stock. And I'm one of the few, but I give myself, I'm going to pat myself, I'm going to break my arm, patting myself in the back. Just because I own a stock doesn't mean I can't think it's overvalued. When I see YouTubers out there pumping and dumping these stocks for no understanding of what they mean, of course, when the stock goes up, they think it means the stock is worth that. No. Intel is not worth $125 a share. I don't care what it is. It's not worth $100 a share in my opinion. Do I think it's worth 50, 40? Yeah, I do. Do I think it's worth 100? No, I don't. And I lost a lot of shares in a covered call at 80 and I have no FOMO. I don't sit there and go, oh crap, I should have kept it. I'm like, okay. I still have a few shares, but not a ton. This is what I want you to remember about our channel. If you're new to our channel, this is why you need to subscribe and pay attention to us because I'm not going to have this BS where I sit there and tell you like, oh, see, this stock goes right. We made a video recently about this where I said, guys, the stock is not worth it. I'm sorry. And by the way, go back a year to our videos on Intel. People are like, you're an idiot. You don't get it on Intel. I'm like, okay, I don't get it on Intel. I don't have to tell you. Like, I guess I don't get it. And now all of a sudden, Paul, you don't get it on Intel. I'm like, wait a second. I didn't get it at 20 and now I don't get it at 120. I'm like, that doesn't make sense to me. [00:06:11] Speaker 2: But I think some of those are the same people too. [00:06:13] Speaker 1: No, they're not. [00:06:14] Speaker 2: It has to be. You're probably right. [00:06:16] Speaker 1: You're probably right. You're probably right. So President Trump speaking in Ankara, which is with the cap, I believe it's the capital of Turkey. Ankara, I don't know, stated that the U.S.-Iran ceasefire agreement was over amid the flare-up and hostilities. As far as I'm concerned, it's just a waste of time dealing with them, he said of Iran. Guys, it's like a soap opera. It's totally like watching like ABC soap opera with like, you know what's funny? You know what it's like? This is what it's like. I got my wife into watching Entourage. She's never watched Entourage before, so she started watching it. I made the mistake of telling her, we're in season two right now, but I made the mistake. No, sorry, if it's on season three, we just started season three last night. I made the mistake of telling her, like the whole idea of the show is, major problem, they fix it. Then another major problem, it's just like this up and down thing. And now I'm thinking to myself, this is Iran and Trump. It's like, oh, the problem's solved. Oh no, it's terrible. Oh my God, the problem's solved. No, they're scum. Oh, the problem's solved. We're going to nuke them. I mean, it's just all this thing back and forth. There's no, and of course my wife says, you know, every single time at the end of the episode, she'll be like, she'll be like, oh, it's glad it ended well. Oh no, wait a second. Here's the Sidewinder. And I'm like, yeah, that's true. But it's still fun for us to watch. [00:07:26] Speaker 2: When Mo used to be a fan of Trump, he would just say, Art of the Deal. Yeah. I don't know if that's true. I've never read Art of the Deal. [00:07:32] Speaker 1: I read Art of the Deal, Art of the Comeback, and Art of the Sale, maybe like 25, 30 years ago. [00:07:37] Speaker 2: So is there like a quote in there in that book that says like, just create as much nonsense as possible? I think this is just a Trump, so Mo doesn't like Trump anymore? I don't think so. [00:07:47] Speaker 1: You don't think so? That's what he said. All right. All right. Okay. So, let's go on to Waymo. Waymo. To start driverless rides and four more U.S. markets expansion, they're going to go to San Diego, Las Vegas, Tampa, Florida, and Denver. Well, I'm glad they told us Tampa, Florida, because I was worried about Tampa, Mississippi over here. Why'd they give us... I mean, listen, there's probably a Tampa somewhere out there, but I know it's Tampa, Florida. There might be a Denver, Iowa, so we got to check that. That's what I mean. Like, there's one Tampa. If I said 100 people, hey, where's Tampa? They're going to say Florida. Nice job, CNBC. Anyways, guys, I've ridden to Waymo. You know, we have a house in Arizona that we rent out on Airbnb. I've been in the Waymo in Phoenix. Apart from it smelling like weed, I thought it was great. It's just nice not to deal with anybody. You just get in the car, shut the door. It takes you where you want to go, and it's all safe and good and great. And I'm sure there's kinks to work out, but the point is I liked it a lot. Now, the question is, if you think Uber's a buy, which a lot of our community members do, and I think it looks pretty attractive, I think they're partnering together in some fashion. The question is, how is Uber going to handle that? We have no idea. So let's go back and look at our Alibaba stock analysis. So let's go look at Alibaba, and we're going to run through some numbers here. So first off, what is the price of Alibaba? A lot of people would say, well, the stock is at 109. Don't care. The market cap is 264. That is the price of the company. Let me see this chart here showing the market cap by years. Look at that. It got as high as $623 billion. I assume that's the end of, let's see, quarterly. And that stock fell. God, I love these new charts here, Tim. Great job. Great job. These are beautiful. Beautiful charts. You just click on any one of these metrics in the chart, and it shows you exactly the history of it. Okay. It's selling. So here's some interesting stuff. The last five-year average free cash flow is $19.7 billion. $11.4 billion the last year. Why? Capital expenditures. They're in the AI race. They're in the cloud computing race. They're building data centers just like everybody else. That's right there. Dividend, they're paying, pays $1.6 billion. $1.6% eats up $4.3 billion of their free cash flow, which they can easily afford. Profit margin, 14% a year for the last 10. 9.6 for the last five. 10.35 for the last 12 months. Returns on capital are kind of shitty. Kind of down. Gross profit of 40%, which means every extra unit they sell is 40% profit. Amazon, by comparison, is about 50%. So, all right. Let's go look at the eight pillars here. All right. So, a lot of positives here. Revenue growth is up. Debt is low. Five-year price of free cash flow is low. So, there's a lot of positives here. Let's see what analysts think about the company. Overdoubling their profit in the next three years. This has changed a lot for this company. It used to be not this way, but going from $5 to $1,185. And revenue, look at this growth. $150 billion to $311. Overdouble in the next seven years. That's 10% a year. So, what we have here now is we have our stock analyzer tool. The goal of this is to put the story and the numbers together and do it early. That way we know, should we spend more time or not on this company? So, I'm doing a 10-year analysis. You can do up to 20 years. First line, what is the revenue growth? Guys, I went a little bit lower than they assumed. I did three, six, and 9% revenue growth a year for the next 10. Next, profit margin and free cash flow. Guys, I'm keeping them the same. I put 15, 18, and 21. Now, keep in mind, they don't have 18 anywhere here, but they were 18 before they started spending a lot of money here. So, I think it'll get back to those margins again. Next, what PE would I assign to this company 10 years from now? Guys, the market average is 15 or 16. You go higher for good companies, lower for bad companies. This company, okay returns on capital, so not screaming a lot, but it is the biggest, like the most important company in China right now, so I give it a little bit of benefit there. Now, a lot of people say, oh, China stinks, whatever. It's still one of the fastest growing economies in the world with a very fast growing middle class, so I'm still willing to give it a premium. I did 14, 18, and 22. And then finally, a 9% desire return. This is not the return I want. It is the return I'm showing to get intrinsic value. This has no margin of safety. You have to have margin of safety because if you just want 9 or 10% return buy a low-cost ETF, put it away, and you'll never think about it again. So what I just showed you is the alternative. Now, guys, you just watched me analyze Alibaba in a matter of a few minutes, and here's what's interesting about today. The market is down, there's geopolitical headline that has people nervous, and yet one stock is up big. Most people see that and they chase it. They see a green number, especially in maybe a sea of red, and they buy, or they see a scary headline about Iran and they sell everything. Either way, they are reacting emotionally. They are not making strategic, rational decisions. That's the trap, and it costs people a lot of money over time. What I just showed you is the alternative. You put in your own assumptions. You put the assumptions about what you think the company can do. Growth, profit, cash flow, all those things, and the stock analyzer tells you the price where you actually get the return you're looking for based on your assumptions. So whether the market is up, down, sideways, or Trump is calling the world leaders scum, it doesn't change your process. You know what the stock is worth to you, and you know the price you need to pay for it. That's it. Our community members tell us this all the time. The noise stops being scary once you have a number and a process to anchor to. They aren't checking their portfolio every five minutes on red days. They're not chasing stocks on green days. They know what they own and why they own it. On red days, if their favorite stocks are down and their thesis is the same, they probably buy more. The question I have for you, what's that peace of mind, that confidence, that kind of community worth to you? If I asked you to put a price on that and I just came to you today and said, how much for that? Would you tell me a dollar? Of course you would. Guys, guess what? It's $7 for seven days in our full access trial. Run any stock you want. Anyone you've been watching, dozens of stocks, so you can do it all and see what it's actually worth before you spend a single dollar or a single minute on it. So click the link below or in the first tagged comment and come build wealth with us. Now, here are what my results look like based on my assumptions above. I hit the analyze button. The stock is currently at $109. This is why I'm bullish on Alibaba. I have a low price of $138, high price of $405, middle price of $240. And I don't think many of my assumptions above were egregious. Remember, this one's based on 3% growth. And I want to point out, when the stock is $190, it makes it a lot different in terms of returns. That's what I want you to remember. A great story becomes a bad investment if you pay the wrong price. Now, we just put out a full video on Netflix. And if you haven't seen it yet, you absolutely have to. They're recently close to a 52-week low and a lot of people in our community and on our channel have been asking whether it's worth buying at this price. Guess what we did? We ran it through our process, our stock analyzers, and the numbers might surprise you. So click the video on your screen right now and go watch it. Thank you for your time.