Alphabet Inc (GOOG)

His largest holding. Customer does all the work and the company gets all the money. Ads have taken a hit. Regulatory scrutiny is a target on the successful; first it was IBM when he started out, then MSFT. It's rather like getting the Good Housekeeping Seal of Approval ;)  

Could be hurt by lawsuits, but it'll be minor. AI will drive growth for the next 10 years.

A name in tech that continues to make sense because of strength and scale. Trading close to its 200-week MA, a very important long-term support level. If it bounces off that, will do very well. Paying 17x PE for 12% earnings growth, not really expensive for a name like this. 

Giant in Search; AI is in early stages and can only improve their products. Cloud business growing quickly. Hardware space is growing too.

It will recover. Whether that's in 2025 depends largely on what the rest of the market does. Its business plan is changing. AI is really taking over from the Search model, and the market sees its market dominance in that area declining. They'll have a share, but we don't know how much.

Has other initiatives, like YouTube, that are real money makers. 47% of people who use the internet go to YouTube once a month or more. A very good hold at current valuation of ~mid-high teens PE.

A tech darling, now trading at only 16x PE. Why? Most of their revenue by far comes from search, and so chat GPT's AI-powered searches will threaten Google search. 

At current share price, incredible value. Grows at over 10% per year. Search, Chrome, Maps, YouTube. Growth monster. R&D spend is almost $50B per year. Trades at 18x PE. Easily a double over next 5 years. Advertising is ~80% of the story, not going away anytime soon. Yield is 0.56%.

He just sold the rest of his shares, and he feels good about that. Owned it since 2014. His main concern is that gen AI will post an existential threat to their search business. Also, if the tariffs cause a recession, their ad revenues will be crushed. But there are many things to like about Alphabet. YouTube is the most important force in media. Their cloud platform is in the top 3 or 4 and growing nicely. And it trades at only 16x PE, much lower than historically.

On the 3-year chart, we see support really close to where we're at right now, around $140. After that, we're probably looking at chop between $90 and $105.

If you really want to buy this name because you believe in its approach to AI, or that concerns are overblown on advertisers not being as robust, or that Mag 7 concerns are over done, then he'd suggest (not recommend) you buy some today. Though you may be early.

Tomorrow may be a tremendous up day, or another down day. He doesn't know. Start with 10%. You don't have to be 100% right. If it's worth buying here, it'll be worth buying 20% higher or lower, assuming the Western world continues. And despite the best efforts of the US administration, it will.

Revenue miss of 9% last quarter. Market's worried about big capex in AI. Earnings up 28% YOY. Very high demand for AI products. Great company. Not expensive at 14x 2027 PE, a lot cheaper than the market. Growing ~14%. Could get cheaper, but still great value looking out 5 years. Don't go in full-scale, but buy in increments.

Normally, this is a time to buy a name like this. But people are concerned about growth, especially of advertising, if we're going into a growth scare. People are also protesting against the US and the Mag 7.

Trades below 19x PE. Of the Mag 7, it has the most to lose if Google search revenue is not offset by Gemini and Chatbot. But they have YouTube, a powerhouse, as is Google cloud. He would sell on strength given the search risk.

He's concerned because he has stopped going to Google, and he can't be the only one.

Likes the acquisition of Wiz, the leader in cloud security. There are synergies between the two. Not clear whether Wiz now favours GOOG, or is still cloud-agnostic. Overall, more benefits than negatives.

Well positioned for the long term. GOOG invented a lot of the fundamental building blocks of AI, yet they get no credit for all that technology. The reason is that they're not good at creating commercial products. Outside of Search, all of their successful products are through acquisition -- YouTube, Android, Google Maps. So the market's wondering if it can make the transition to a generative AI future.

This helps explain why the multiple's where it's at. They could turn all this around and it would be an opportunity, but it'll probably take a change in leadership. Take a look at the history of MSFT since 2012.

Excellent company. Not worried about this weakness. Trades at a reasonable valuation vs. its growth rate. Buy it for the long term. Today, they bought a cybersecurity company and will likely be Trump's first test on anti-trust--watch this.k

It is the least expensive of the Magnificent 7 at 18 1/2 times earnings. It has been weighed down by the tech slide and the threat by the Department of Justice to break it up. However the U.S. protected TikTok from being shut down. Also investors are worried about ChatBot eating into the search component but he feels that this is not commercial intent but more knowledge seeking.         Buy 60  Hold 15  Sell 0

You're buying this at a lower multiple as recently as January. If you think earnings will hold up as well as AI and data centre spending, this makes sense.