☕️ Palantir scores again… did you?

Howdy! 👋 

Yields are still high but, interestingly, the markets aren’t “low.” 

In fact, they’re starting to see a bid despite the US 10 YR yield hitting a 2 year high of 4.796% this morning. 

I have no idea if that’ll last but I easily imagine that it does. 

Roughly 97% of the S&P 500 has reported and of that 97%, 86% have reported positive EPS surprises while 77% have reported positive revenue surprises. More importantly, the blended growth rate is 52% as of last Friday according to FactSet. 

Three guesses which one I want you to focus on! 🎯 

Exactly! 

Profits. 

Theirs and yours. 

So many people make the mistake of chasing “hot stocks” when the world’s most successful investors constantly focus on the names that’ll be there when you need ‘em. 

I know I sound like a broken record but that is very deliberate on my part. 

There is a lot of hype, hooey and horse puckery masquerading as investment advice out there right now. Much, if not most of it is very, very destructive to your wealth. 

Keep it stupid simple. 

Here’s my playbook.  

1 – Apple's new leadership & why the best may be yet to come 

I sat down with my good friend and colleague Scott “The Cow Guy” Shellady – so named for the colorful old-school cow-themed pit jackets he wears on air. We had a wide-ranging conversation including what I think incoming Apple CEO John Ternus could do for the stock, the companies I think will be there when you need 'em, inflation and more. (Watch) 

2 – Musk at G20: “AI race will be won with power” 

Unka Elon took to the stage at the G20 meeting in Chapel Hill and said, “There actually is quite a crisis of power." Not a chip crisis. Not a regulation crisis. A power crisis — and he says it's landing next year, not "someday.” 

I agree and it’s a point I’ve been making for a while. 

Investors who aren’t paying attention are kidding themselves… and missing one of the biggest investment opportunities of all. 
 
AI chip output is climbing 40–50% a year but power supply outside China is only growing 10–20% a year.  

To a point I’ve made repeatedly about rates and profits… earnings and revenues… markets and mayhem… Musk said simply “The faster rising thing will eventually overwhelm the slower rising thing."  

This isn’t rocket science.  

Are you really going to worry about inflation growing at 4% a year when you can buy companies growing at 100% or more? 

I’m not. 

Which brings me back to the power. 

Industry consensus, per Musk — a 15 gigawatt shortfall by 2027 just for AI chips. 

Meanwhile The Dragon is adding power generation by the hundreds of gigawatts a year.  

Do the math. 

You can own every AI chip on the planet, but it won’t matter if you can't plug it in.  

I hope you have this covered. 

Nukes and all the fancy stuff is great down the line but the immediate need is going to produce immediate profit potential. 

I hope you have this covered like the OBA Family does! 

3 – The last man standing in Venezuela just placed a $7 billion bet

Chevron announced a $7 billion investment to more than double its oil production in Venezuela over the next five years. We're talking a jump from roughly 280,000 barrels a day to 600,000 — with two new oilfields in the Orinoco Belt added to the mix. (Read) 

Here's the part that matters and one that I have talked about many, many times. 

Chevron is the only U.S. oil major still operating in Venezuela, running joint ventures with state-owned PDVSA.  

Everyone else walked away. 

You know what to do and, I hope frankly, did it a long time ago. 

Buy the best, ignore the rest!® 

4 – Dell rocked earnings; time to buy? 

Dell just posted a big earnings and revenue beat, powered by AI demand. The company's sitting on a record $95 billion backlog for AI servers. (Read) 

Shares are climbing on the news because market makers used selling earlier this week to balance the book. Absent more kinetic warfare in Iran, I expected shares to fall after earnings but the markets took care of that ahead of time.  

Keith’s Investing Tip: Many aspiring investors try to force things, but my experience is that you simply move on if you don’t have the setup you want. No risk, more opportunity. 

Should you buy Dell?  

That depends. 

Dell's overall gross margin came in at 21.1% this quarter. Great for Dell but not even remotely close to Nvidia, which is running gross margins around 75%. 

Read that again. Nearly a 3.55X performance advantage.  

Dell moves $47 billion worth of hardware through the door and keeps about 21 cents of every dollar. Nvidia sells the chips going into that same hardware and keeps about 75 cents of every dollar — no matter who’s box they end up in. 

Meanwhile and on a related note, Palo Alto Networks – another company I called out my discussion with the fabulous Stuart Varney yesterday as a stock I thought likely to fall after great earnings is down 8.65% as I type this morning. 

Hope you made some hay while the sun shines. 

What’s next? 

Roughly 80%+ of daily trading volume comes from algorithms — quant funds, market makers, and program trading desks — not humans reading the earnings release and deciding "buy" or "sell."  

Market makers don't take directional bets for a living — they make money on the spread and manage inventory. When a stock gets hit by a wave of algorithmic selling that isn't matched by a change in the underlying fundamentals, market makers often step in as buyers to absorb that flow, because they can price the stock more accurately than the panic-driven volume suggests it's worth.  

They could care less about the stock itself; they’re busting a move because the imbalance creates an opportunity to buy low and let the position mean-revert. If so, that means the market makers are already buying as it drops so that they can come roaring back to the upside if the buy programs kick in. 

Buying a few speculative calls – a bet the stock rises – could be interesting if there’s a snapback. 

Hmmm. 🧐 

5 – Palantir scores again – did you? 

The U.S. Army just handed Palantir yet another vote of confidence (Read). 

This time around, the US Army Contracting Command has awarded Palantir USG a prime contract to build eight TITAN ground station systems — four Advanced, and four Basic.  

If you’re not familiar with it, TITAN, also known as Tactical Intelligence Targeting Access Node, is the Army’s next-generation deep-sensing platform. It pulls data from space, high-altitude, aerial, and terrestrial sensors and feeds real-time targeting information straight to commanders and their troopers in the field. 

Palantir isn't just the software layer here — it's the prime contractor, meaning it now owns manufacturing and delivery across the entire system while directing a bench of partners including Anduril, L3Harris, and Sierra Nevada.  

That's a meaningfully bigger slice of the defense dollar than a licensing deal, and it puts Palantir in the position of systems integrator on one of the Army's flagship modernization programs — not just a vendor bidding for renewal next cycle. 

No word from His Excellency Big Shortimus Maximus. 

I probably still don’t have enough shares. 🤦‍ 

You?  

Bottom Line 

World class companies get beaten down more often than you’d think for reasons that have nothing to do whatsoever with the business case for owning ‘em.  

Not surprisingly, it stands to reason that you’ve often got one heckuvan opportunity when you can identify one of ‘em. 

You got this — I promise. 

As always, let’s MAKE it a great day. 

Keith 😀