Manchester & London Inve... Share Discussion Threads

[takeiteasy] 23/5/2024 05:12

The commentary that came with the earnings report was bullish in the extreme, as we have come to expect from Nvidia. CEO Jensen Huang, started by saying that the ‘next industrial revolution has begun’. He said that data centres are being reinvented as ‘AI factories’ to ‘produce a new commodity: artificial intelligence’. This is the type of talk you hear at the start of something big. Since AI is essentially in its infancy and Nvidia is at the forefront of providing the hardware necessary for its evolution, there is the potential for bigger and bigger revenues during this multi-year build out.

Huang mentioned that Nvidia’s customer base has expanded beyond just cloud service providers, to consumer internet companies, enterprise, sovereign entities, automotives and to healthcare companies. Nvidia is continuing to grow its customer base, which is why revenue keeps rolling in. There are many industries that are expected to use AI that are not listed by Huang. No doubt this list will keep growing, and sectors that are not on the list today are likely to be Nvidia customers of the future



One day this fund might actually be rewarded rather than punished (nearly double the discount of ATT/PCT rivals) for having an exceptionally high concentration to arguably the most important and successful tech stock on the market atm -

dyor/nai etc

[takeiteasy] 23/5/2024 05:06

hxxps://www.msn.com/en-us/money/topstocks/nvidia-earnings-stock-rallies-as-ai-giant-reports-600-profit-explosion-10-for-1-stock-split/ar-BB1mSbxV

Nvidia reported $6.12 earnings per share and $26 billion of sales for the three-month period ending April 30, shattering mean analyst forecasts of $5.60 and $24.59 billion, according to FactSet.

Nvidia’s profits and revenues skyrocketed by 628% and 268% compared to 2023’s comparable period, respectively.

This was Nvidia’s most profitable and highest sales quarter ever, topping the quarter ending this January’s record $12.3 billion net income and $22.1 billion revenue.

Driving the numerous superlatives for Nvidia’s financial growth over the last year is unsurprisingly its AI-intensive datacenter division, which raked in $22.6 billion of revenue last quarter, a 427% year-over-year increase and a whopping 20 times higher than the $1.1 billion the segment brought in in 2020.

Nvidia also announced it will conduct a 10-for-1 stock split June 7, which would trim its share price from about $950 to $95 while maintaining the company’s total valuation, enabling investors and employees to more affordably purchase whole shares.

dyor/nai etc

[takeiteasy] 21/5/2024 16:40

MSFT at 431 at ATH :) hopefully act as a hedge with NVDA over the results tomorrow one way or the other ...dyor /nai

[takeiteasy] 19/5/2024 12:57

Interesting PR :)

dyor etc

[takeiteasy] 18/5/2024 07:05

According to HL, MNL discount 16%, SMT 7%, ATT tech trust 8% and PCT tech trust 8%.

We may come smelling of roses after the Nvidia results but imvho the market is pricing in the additional concentration risks from our approach.

YTD price performance between the MNL/ATT/PCT trusts are much the same (we are still ahead over a year).

If you want to absolutely maximise beta risk you have your most volatile stock with the highest concentration - we all get that. The challenge then is the performance has to be consistently ahead to compensate for the additional risk capital.

It will be interesting to see if this risk discounting continues, whether this influences the portfolio construction concentrations at all :)

imvho dyor/nai

[takeiteasy] 17/5/2024 15:39

Microsoft (NASDAQ:MSFT), Advanced Micro Devices (NASDAQ:AMD) – Microsoft unveiled plans to offer cloud computing customers an AMD artificial intelligence chip platform, directly competing with Nvidia (NASDAQ:NVDA). The MI300X AI clusters will be available through Azure, offering an alternative to Nvidia’s GPUs, while the Cobalt 100 processors will also be launched. In other news, the UK’s second-largest grocery store, Sainsbury’s, has entered a five-year partnership with Microsoft, using AI to enhance online shopping experiences, improve search functions, and streamline processes in physical stores.
dyor etc

[takeiteasy] 16/5/2024 12:50

Perhaps a pause on activity levels here until the Nvidia results are out next week - this holding is c.30% of the fund so will have quite an impact I suspect....


dyor etc

[takeiteasy] 15/5/2024 11:47

Useless fact but FTSE100 is now ahead of Nasdaq performance YTD (by a little)...gone very quiet here for a while now....

[takeiteasy] 12/5/2024 22:18

If you want somebody else in the sector to validate our manager's approach for AI picks and shovels strategy (ignoring the Tesla comment in the middle) - then you may smile when you view this interview given all the communications from MNL over their investment rationale.

dyor/nai etc

[takeiteasy] 11/5/2024 06:02

TipRanks
May. 10, 2024, 08:45 AM
Frank Lee CFA, an analyst from HSBC, maintained the Buy rating on Nvidia (NVDA – Research Report). The associated price target was raised to $1,350.00.


Frank Lee CFA has given his Buy rating due to a combination of factors influencing Nvidia’s future financial performance. He anticipates that Nvidia will maintain strong pricing power through its NVL36/NVL72 server rack systems and the GB200 platform. These products are expected to drive revenue significantly above market expectations by FY26, with server rack systems alone projected to contribute USD 67 billion. Lee’s analysis suggests that Nvidia’s advanced product lineup, including its AI product roadmap and the upcoming GB200, with a higher average selling price (ASP), will surprise the market on the upside and lead to substantial earnings growth.

Furthermore, Frank Lee CFA cites the potential for Nvidia to surpass consensus sales estimates in the short term, despite acknowledging some near-term uncertainties due to product transitions.

hxxps://markets.businessinsider.com/news/stocks/nvidia-s-strong-pricing-power-and-product-roadmap-to-drive-revenue-and-earnings-growth-a-buy-recommendation-1033364563?op=1

dyor/nai etc

A footnote to the above is that the analyst HSBC Head of Technology Research Frank Lee had been the only one among 48 analysts covering Nvdia to have a negative rating on the chipmaker, according to Refinitiv data back in April 2023 :)

[takeiteasy] 10/5/2024 18:15

Re 539 - I wonder if our manager read this before his large purchase :)

hxxps://www.msn.com/en-us/money/markets/ibd-stock-of-the-day-taiwan-semiconductor-jumps-on-april-sales-report-lifts-fabless-chipmakers/ar-BB1mayim



dyor /nai etc

[takeiteasy] 10/5/2024 11:41

new fact sheet out
hxxps://mlcapman.com/wp-content/uploads/2024/05/MLIT_Factsheet_202404.pdf

[iminterested] 09/5/2024 23:02

The manager buys £638,000 of Mnl stock with his own money. This is extraordinary for a fund manager relative to many others.
He may just be right!!

[iminterested] 09/5/2024 08:18

Thank you for the above

[takeiteasy] 09/5/2024 05:55

The other most over sized position NVDA at 25-30% also has plenty of scrutiny from the analysts checking on sales channel progress to gain more confidence in revenue outcomes vs. expectations. GS below provide quite a detailed assessment showing recent improvement in revenue growth rates.

So again, if you believe the analysts from Goldman Sachs again our manager can claim that there is support for Nvidia holding in the portfolio - whether this should be quite as high as the current level or much smaller is a separate issue.

"Given the company’s standing in the AI game, the stock has more room to run. That, at least, is the opinion of Goldman Sachs’ Toshiya Hari, an analyst ranked amongst the top 1% of Street stock pros, who believes that even in the face of the continued gains, the shares still show a “favorable risk/reward.
As in previous quarters, Hari anticipates Nvidia’s Data Center segment’s performance in its fiscal first quarter (April quarter) and its FY2Q (July) guide will be boosted by the sustained demand for AI-related Computing and Networking. This is down to the consistently positive feedback from various players in the AI industry, such as cloud service providers, hyperscalers, ODMs, and other component suppliers. Additionally, the introduction of several new products, including the H200 in FY2Q and the Spectrum-X and Blackwell later in the fiscal year, should also contribute to growth. As such, Hari now predicts sequential growth rates of 10%, 17%, and 5% in Nvidia’s Data Center business for FY2Q/3Q/4Q respectively, compared to his previous estimates of 10%, 15%, and 0%."

hxxps://www.msn.com/en-us/money/markets/can-nvidia-stock-reach-record-high-of-1-100-here-s-what-goldman-sachs-expects/ar-BB1m42UE

dyor/nai

[takeiteasy] 09/5/2024 05:46

Imvho the strongest argument our manager has for the current portfolio conentration of giving MSFT 25-30 percent position sizing (given the stage of the cycle) is that analysts support his view that it is MSFT as the main software beneficiary of AI income wise in their wider adoption of AI copilot amongst the installed Windows client base.

This is a nuanced judgement and best that there is independent support e.g. from BAC that the approach still remains relevant at the present time :)


Brad Sills, research analyst at Bank of America (BAC), summed it up nicely: Microsoft’s Azure offering “is the only software business that is benefiting from AI at this point in the cycle. Microsoft remains ahead of the curve in this massive new cycle.”

Microsoft’s chair and CEO Satya Nadella said nearly 60% of Fortune 500 companies were now using Copilot, which was experiencing “accelerated adoption

hxxps://www.msn.com/en-us/money/other/microsoft-still-leads-the-ai-race-it-s-not-too-late-to-buy-the-stock/ar-BB1m3rL7?cvid=82658965f3ed446a9a54c422a4880f29&;ei=34

dyor and nai

[iminterested] 08/5/2024 18:14

RE
The most important one is daily pricing as this would enable a wider range of professional intermediaries to invest who have compliance embargos around stocks not being priced daily etc etc

There are plenty of INV TRusts bigger than MNL that dont do daily nav, if its easy ehy not.
However I doubt it will change the nav discount

Also compliance embargos, can you illustrate who falls foul of this?

[takeiteasy] 08/5/2024 15:07

NAV 775 - a decent week ....dyor etc

[takeiteasy] 08/5/2024 14:38

Yes, I think you and MNL are pretty much in agreement over this given your earlier comments to me. That may be a general rule but there are sufficient exceptions with other ITs (some are at a premium at the moment as we all know) to make me realise I would prefer that the firm did more than they are doing to address this.
The most important one is daily pricing as this would enable a wider range of professional intermediaries to invest who have compliance embargos around stocks not being priced daily etc etc - they I think would be an important audience to draw in as the AI theme builds momentum ...

[iminterested] 08/5/2024 09:27

This was posted on X today by MNL

"Discounts are driven by the US long bond yield.

Until US10YR comes down to ~2.5 per cent "you can huff and you can puff" but it wont change! It is just a waste of energy fighting a causal correlation"

Like MNL,I feel that in the UK, whilst base is 5.25% and obvs 10 year USD Treasuries are elevated discounts are unlikely to tighten too much.

In order for the discount to narrow it will require more aggressive buyers than sellers and whilst I can see MNL trading at -10/12 %, the rate cycle( which may start within a month), needs to have downward velocity.

[takeiteasy] 08/5/2024 06:20

Some general AI market observations and more focus on ASML held here.

Dyor etc

[takeiteasy] 08/5/2024 04:52

Our 5th largest holding at 31/3....the comments about the scale of wider AI industry cloud demand are interesting :)

hxxps://www.msn.com/en-us/money/markets/arista-networks-stock-rises-after-strong-ai-cloud-demand-powers-earnings-outlook/ar-BB1m05j1

Cloud networking giant Arista Networks (ANET) saw its shares rise almost 7% higher in extended trading Tuesday after a trifecta of upbeat news—an earnings beat, better-than-expected current-quarter outlook, and a big share buyback program amid strong cloud demand from artificial intelligence (AI) applications.

dyor etc

[takeiteasy] 06/5/2024 06:15

Nvidia stock price target lifted at UBS
Earlier in the week, analysts at UBS hiked their target price for Nvidia stock (NASDAQ:NVDA) from $1,100 to $1,150 and maintained a Buy rating on the AI chipmaker.

The bank’s team of analysts believes that the expected shipment timing for Blackwell is still in December, which might cause a slowdown in growth during the October quarter.

Despite this, they pointed out that the demand for Nvidia’s GPU microarchitecture, Hopper, remains unexpectedly robust, serving as a strong buffer against the impacts of the upcoming major product transition.

5/5 update - dyor and nai etc