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More on Today’s Markets:
For Broadcom, I believe that concerns about it reversing into a downtrend appear to be premature. Yet the fact that it has underperformed its semiconductor peers lately has also not been lost among investors watching this momentum play out closely.
In the end, the Micron business profile has essentially remained unchanged, making its shares such an attractive investment. Moreover, I believe that robotics is the future, ensuring continued growth in demand for memory starting in 2030. That said, risks of overvaluation given the increasing likelihood of Fed rate hikes cannot be ignored. As a result, my rating on MU is being downgraded from “Strong Buy” to “Buy.”
The stock looks cheap on a forward P/E basis, but I think earnings being baked in are potentially at risk due to documented delays in the planned data center build-out. A clogging up of the data center pipeline could cause customers to meaningfully slow down their purchases and installations of Nvidia chips. I don’t think this would lead to a decline in earnings, but it does make the current consensus estimates look quite challenged. Markets are expecting Nvidia to grow EPS by close to 90% in FY27 and another 40% in FY28.
Despite a strong earnings report for the second fiscal quarter—which showed 48% Y/Y top line and 60% Y/Y free cash flow—the company’s unchanged guidance for FY 2027 triggered a more than 12% downside move in the stock price the day after earnings were released on June 3, 2026. Since I am super-bullish on the AI infrastructure business, the drop, in my opinion, is a no-brainer engagement opportunity to buy into Broadcom at a discounted price!
Nebius is the rare neocloud where the enterprise risk has been engineered away: $47B of committed contracts, customer prepayments funding the capex, NVIDIA in the register, and Meta underwriting the merchant risk. The equity question is narrower and harder: at $220, you are paying 7.4x my 2027E revenue for a business whose first contract cycle returns roughly 75 cents on the dollar, and whose excess return depends entirely on cycle-two pricing and software attach, neither provable before 2028. The market has priced base-case delivery in full and credits none of the bear.
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