Alphabet Inc (GOOG)

(A Top Pick May 19/16. Up 31.1%.) He still likes this but it has been part of the small pull back in the Tech sector. If this starts to fall down to the $900 level, that would be a good entry point.

(Market Call Minute.) A fantastic franchise. They continue to grow revenue using cash flow into the 20% range. They are monetizing areas that they weren’t years ago.

Technology is probably the most important secular long-term theme in the market. This company plays right in the middle of a couple of the key themes, but the most important is Cloud and Search. He sees signs in the near term that some of the more cyclical sectors, like financials and industrials, may be seeing some rotation into those names with a little money coming out of technology. (See Top Picks.)

Everything is going their way. They have huge margins, new business and lots of potential. His target price is $1150-$1200 over the next 12-18 months.

It is an interesting entry point with the selloff in tech. There are a lot of secular tail winds. A great stock to own long term.

Market share in advertising is at about 25%, and he doesn’t believe anybody has had higher than that. Doesn’t know if they can hold onto this, but it is going to be very difficult for them to increase it. He would prefer companies that have lower market share, but more runway, something like Facebook (FB-Q). Facebook also has some non-core businesses, things that have yet to generate a profit.

He is quite constructive on this. It is part of the oligopoly on the Cloud space. They have a couple of things going for them along with a headwind that they are fixing. Core ad spending is up almost 20% and they continue to pull in more ad spending. Spending was getting out of control, but are working on that. Valuation is not out of line for the growth you are getting.

Doesn’t think there is a day that goes by when you don’t use Google. They totally dominate Search and is the world leader by far. They are also investing in all these other wacky and interesting things. Totally unappreciated, relatively speaking, but it is a company that is almost a “must own”. There is a lot they can do in terms of monetization with the video and stuff, that they are not yet doing.

AAPL-Q vs. GOOGL-Q vs. AMZN-Q. He likes these two as well as AMZN-Q. You could make a case for all three. He owns all three. These guys are changing the world. AAPL has not had an announcement for a while, but will have announcements in the next year. They could pull back a bit, but he would own all three.

He is very keen on this. They are doing great things. On advertising and search, they are taking away from the incumbents and have lots of things in the hopper. Great balance sheet and a really durable franchise. Going forward, the virtual reality and artificial intelligence are going to be really big components for them.

This is a huge company, and the core advertising is still up 17% year-over-year. 66% of ad spending is still off-line. They are getting more than their fair share and focusing on things that matter, such as machine learning, autonomous driving, AI. (Analysts’ price target is $1050.)

Owned since 2009. Sell? That was a fabulous buy. When he has a stock that goes up a lot, he takes some money off the table. Sell enough that your original stake is off the table, so that no matter what happens you can’t lose any money. You also have to look to your portfolio diversification. This should be sold down and diversified into other names.

Technically this is in a long upward trend. Hit an all-time high today. This has a history of moving higher in 2 periods; from November right through until January, and from around March through to June. This is a good one to be in right now.

You must weight political positions with investment data. Policy is forming in the US, but there are truths about economical data that we cannot ignore. The prospects for US investment are hard to ignore. He cannot own this one in his portfolio because it does not pay a dividend. Cloud computing is a story that is playing out and Google is a leading company in this business. It is a pretty good choice to hold. Buy it on weakness.

One of the most important themes in this market are the big Internet content companies. The things they have going on in this business are quite remarkable, not to mention their key businesses which are doing remarkably well. This is a theme that investors have to be invested in.