Podcast Summary
Discussion on tech stock picks and performance: Apple, Microsoft, Google, and Zillow are strong performers. Tesla faces challenges. Google, Apple, and Zillow are potential growth stories. Lyft is viewed with caution. Since 4th of July, significant gains for Apple, Microsoft, Google, and Zillow.
Tech experts Gene Munster and Dan Ives discussed their stock picks and performance since the summer of 2023. Apple and Microsoft were identified as strong performers, while Tesla faced challenges due to price wars and the need to focus on margins. Google, Apple, and Zillow were highlighted as potential growth stories, while Lyft was viewed with caution. Since the 4th of July, Apple, Microsoft, Google parent Alphabet, and Zillow have all seen significant gains. Despite some challenges, the tech sector is seen as still being in the early stages of growth.
Improving home valuations through real estate tech: Real estate tech companies like Zillow are making progress in increasing accuracy and transparency of home valuations, potentially improving net worth understanding and reducing home buying/selling friction. Tech mega-caps like Microsoft and Alphabet's market caps could continue to grow due to AI revolution.
The speakers believe that the real estate tech sector, specifically companies like Zillow, are starting to make progress in improving the accuracy and transparency of home valuations. This could lead to better understanding of people's net worth and reduce friction in the home buying and selling process. They also discussed their investment views on stocks like Lyft and Microsoft. Despite Lyft's recent gains, they still view Uber as the better positioned company. Regarding the tech mega-caps like Microsoft and Alphabet, they believe that the current gains are just the beginning of the AI revolution and these companies' market caps could continue to grow significantly in the coming years.
New Tech Bull Market Driven by AI: Experts predict a new tech bull market fueled by AI, with potential $1 trillion incremental spend and massive value increase for companies like Microsoft, Google, and Apple.
The speakers believe we are on the brink of a new tech bull market driven by Artificial Intelligence (AI). They compare the current situation to the 1995 era before the dot-com bubble, predicting a massive run-up in value for companies like Microsoft, Google, and Apple. AI is seen as a transformative technology, on par with electricity, with a potential $1 trillion incremental spend over the next decade. The speakers caution that it's still early days for monetization, and the current valuations do not indicate a bubble. They encourage investors to prepare for this new bull market by staying informed and being ready to invest.
AI Economy: Monetization Beginning in 2024: AI is set to transform industries like finance, insurance, healthcare, and government, with monetization starting as early as 2024. Use cases include unstructured data analysis in finance and scientific research in healthcare.
Artificial intelligence (AI) is expected to have a significant impact on the economy and create wealth opportunities within the next 3-5 years. According to Gene Munster and Dan Ives, two investment professionals, the monetization of AI is likely to begin as early as March or April of 2024. They suggest following the use cases in industries such as finance, insurance, healthcare, and government, as these areas are expected to see the most significant transformation. Specifically, they mention the use of AI in financial services for unstructured data analysis and in healthcare for scientific research. Gene Munster also emphasizes the potential of Microsoft's Copilot feature, which is expected to provide real utility and substance in 2024. Overall, the experts believe that the implementation of AI in various industries will result in significant improvements and revenue opportunities in the coming years.
Impact of AI on Business Growth in Social Media: AI integration in social media is expected to boost engagement and daily active users, benefiting companies like Meta and hardware manufacturers Nvidia and AMD. However, concerns around addiction, over-reliance, and regulatory response persist.
The integration of AI in various industries, particularly social media, is expected to significantly impact business growth through increased engagement and daily active users. Companies like Meta and hardware manufacturers such as Nvidia and AMD are anticipated to benefit from this trend. However, concerns around the potential addictiveness and over-reliance on AI, as well as the regulatory response, remain pressing issues. The speakers acknowledge the risks of AI outpacing regulation and potentially harming humanity, but believe that the leading companies are aware of these risks and will implement self-regulation to ensure the sustainability of AI technology.
AI drove 25% of gains for tech stocks in 2023: Investor optimism towards growth stocks, a flight to quality, and the growing importance of tech companies in our daily lives contributed to the remarkable gains of the 'magnificent seven' tech stocks in 2023, with AI accounting for about a quarter of their growth.
Artificial Intelligence (AI) was a significant contributor to the impressive gains of the "magnificent seven" tech stocks in 2023, which doubled in value collectively. However, it's essential to note that the broader market context also played a role. After the tech sector faced a negative reputation in 2022, investors began to show optimism towards growth stocks and a flight to quality in 2023. Companies like Apple, despite being relatively quiet on AI, experienced substantial growth of 55% due to the increasing dependence on these tech giants in our daily lives. Gene Munster believes that AI accounted for about a quarter of the gains, with some companies like Nvidia experiencing even more significant growth. Dan Ives agrees, adding that these tech companies started to cut costs after years of excessive spending. The competition between the US and China in the AI field is also an essential factor to consider. Overall, while AI was a significant driver, the broader market context and the growing importance of these tech companies in our lives contributed to their remarkable gains in 2023.
Tech sector to continue growth trajectory in 2024: Despite uncertainty around interest rates and market fluctuations, tech sector's growth is anticipated due to earnings growth, potential rate cuts, and increased monetization through M&A. Tech stocks have historically been resilient during rate hikes and could experience a prolonged bull market.
The tech sector, particularly large tech companies, are expected to continue their growth trajectory into 2024, despite the uncertainty around interest rates and potential market fluctuations. The optimism is driven by anticipated earnings growth, potential rate cuts, and increased monetization through mergers and acquisitions. The speakers also noted the resilience of tech stocks during past rate hikes and the potential for a prolonged bull market. However, they cautioned that market volatility and regulatory challenges could impact the sector. Overall, the consensus is that tech will remain a significant focus for investors in the coming years.
Apple's AI role and potential M&A in 2024: Focus on Apple, Google, and chip makers for AI growth; Palantir, MongoDB, Snowflake potential outperformers; NVIDIA dominance uncertain beyond 2025; Look beyond current valuations for growth potential in 4th industrial revolution
Apple's role in AI and potential M&A activity related to it will be a significant topic in the tech industry in 2024. The broadening of tech growth is also expected, with companies like Palantir, MongoDB, and Snowflake being potential outperformers due to their AI use cases and massive install bases. NVIDIA's dominance in AI chips is currently unchallenged, but growth rates beyond 2025 are uncertain. Investors should focus on companies like Apple, Google, and those building chips to compete with NVIDIA for the next few years. The tech roundtable between Gene Munster of Deepwater Asset Management and Dan Ives of Wedbush Securities also touched on the importance of looking beyond current valuations and focusing on growth potential in the next 2-5 years, particularly in the context of the 4th industrial revolution.
Tech Stocks and AI to Drive Growth in 2024: Experts predict significant growth for tech stocks in 2024, with a focus on mergers and acquisitions, AI monetization, and the rise of smaller, transformative companies. Google, Apple, Microsoft, Palantir, and MongoDB are among the bullish picks.
Optimistic outlook on technology, specifically tech stocks and artificial intelligence (AI), for the year 2024. Dan Ives expressed his belief that tech stocks will experience significant growth, with a focus on mergers and acquisitions and the monetization of AI. Gene Munster shared his view that there will be a fracturing of the mega tech companies, with Apple, Google, and Microsoft performing exceptionally well. He also highlighted the potential of smaller, transformative tech companies, as represented by the Deepwater Frontier Tech ETF. Both Gene and Dan mentioned specific stocks they are bullish on, including Google, Apple, Palantir, and MongoDB. Microsoft was mentioned as the top of the mountain in terms of market cap. Overall, the consensus seems to be that AI will be a major driver of growth in the tech sector in the coming year.
Discussing avoided stocks based on growth stories: Analysts Gene Munster and Dan Ives discuss their reasons for avoiding Lyft, Snap, and Netflix due to perceived lack of compelling growth stories or innovation. Their views may change throughout the year.
Key takeaway from this discussion between Gene Munster of Deepwater Asset Management and Dan Ives of Wedbush Securities on Bloomberg's The Deal podcast is their insights on companies they avoid due to their perceived lack of compelling growth stories or innovation. Munster named Lyft and Snap as his avoids, citing their history of quarterly disappointments. Ives shared his dislike for Netflix, believing it to be a large company in a hypercompetitive market without a strong growth story or AI play. Both analysts acknowledged that these views may change as the year progresses. Additionally, Munster emphasized that success in business isn't just about bringing together big names, but also about opening new doors through collaboration and innovation. The show, The Deal, explores deal making across various industries and can be listened to on podcast platforms or watched on Bloomberg Originals, Bloomberg Television, or BTV plus.
