SpaceX SPCX shares are pushing higher as investors aggressively position their portfolios ahead of the aerospace titan’s highly anticipated inclusion into the Nasdaq-100 index on Jul. 7.
The upcoming milestone is fueling intense market optimization, as institutional traders race to get ahead of massive index-fund buying.
SpaceX stock’s performance this morning reflects an encouraging rebound in what has been a high-stakes, volatile journey since its market debut earlier this month.
SPCX climbed to an all-time high of nearly $226 on Jun. 16, before experiencing significant profit-taking that dragged shares down to a low of about $147.
SPCX stock is extending gains on Tuesday primarily because of its fast-track entry into the Nasdaq- 100 index, scheduled for next Tuesday.
Because passive index-tracking funds and exchange-traded funds (ETFs), including Invesco QQQ Trust, which commands over $800 billion in global assets, are legally required to accurately mirror the benchmark index, they'll be forced to buy SpaceX worth billions of dollars in the weeks ahead.
Wall Street analysts estimate this mechanism will trigger a massive wave of mandatory buying.
Specifically, JPMorgan experts project the Nasdaq-100 inclusion alone will generate roughly $4.3 billion in structural passive inflows, which could drive SPCX much higher in the near-term.
Investors are loading up on SpaceX shares also because Elon Musk’s space infrastructure and AI giant is slated for near-term inclusion in FTSE Russell’s US and global benchmarks, including the Russell 1000 as well.
According to Bloomberg Intelligence, this secondary indexing event could unleash an “additional” wave of passive buying.
Because SpaceX’s publicly tradable free float remains relatively tight following its IPO, analysts believe this “multi-billion-dollar” wall of institutional money chasing a limited supply of available shares could create structural buying pressure.
This will likely corner short sellers and orchestrate a breakout in SPCX over the next few weeks.
Despite the post-IPO turbulence that often plagues massive market debuts, the long-term outlook for SPCX shares remains rather bright.
A strong combination of structural index-fund buying and revolutionary commercial expansion positions this aerospace giant for a bullish second half of 2026.
By anchoring its valuation in both physical space exploration and digital connectivity, SpaceX is successfully capturing the imagination of both retail and institutional investors.
The company’s strategic pivot toward consumer mobile telecom via its potential partnership with Charter Communications highlights a management team that refuses to rest on its laurels.
In short, as billions of dollars in passive capital prepare to flood into SPCX over the coming weeks, the stock is gaining a powerful institutional floor and may be warming up for significant further upside through year-end.
I had been a professional trader for nearly 15 years before I fell into trading options seriously. After a decade and half of a constant, high-stakes grind, I sold my stake in a successful trading firm and decided to take a year off from trading to recharge.
It was during that year that I became close friends with a neighbor of mine. He was a market maker at the Chicago Board Options Exchange (CBOE). He gave me a behind the scenes look at his operations — along with his trading statements — and I was blown away.
Despite all of my experience, I realized then there was a whole world of trading I hadn’t tapped into — options trading. I spent months managing his book for free, and after I got my sea legs, I decided to set out on my journey to become a market maker myself.
What drew me to options — and what keeps me coming back even after all these years — is their incredible versatility. Unlike stocks, options allow you to express a range of opinions about a stock’s future. Will it rise? Fall? Stay flat? With options, you can craft strategies to profit no matter the scenario.
This flexibility is why I now consider options the ultimate trading vehicle. They offer the perfect balance of leverage and risk management, which makes them the perfect instrument for traders to use their experience and creativity to find setups with truly explosive potential.
Options Provide Flexibility
With options, we’re not limited to simply buying or selling shares at the current stock price. Options traders have the ability to express their opinions on a specific company, fund, or commodity in a variety of ways. Not only can we choose directionality with calls and puts, but we can also choose what price levels we want to target…
If we think Apple Inc. (AAPL) is going to $250, we can buy the $250 out-of-the-money calls instead of buying the at-the-money $225 calls, getting our portfolio leveraged exposure to the rise in share price — usually at a fraction of the cost.
The downside, of course, is that there’s no guarantee Apple will go up, let alone approach that $250 mark before our options expire. If an option expires out of the money (OTM), its value drops to zero and we lose our initial investment. That might sound scary, but it’s also one of the reasons options are such a powerful tool when used strategically.
Unlike buying the stock outright, where a drop in price could wipe out a significant portion of your portfolio, with options your maximum loss is capped at the initial premium you paid. This built-in risk limitation is a safety net available to traders that far too many overlook.
Even better, options offer flexibility that allows us to adapt our trades to changing market conditions.
If we’re holding that $250 call and Apple starts moving in the right direction, but stalls around $240, we’re not stuck watching our trade decay into a loss… Instead, we can take action and transform that single call into a vertical spread by selling a higher strike call, say at $260. Doing this brings in premium that reduces our initial cost, lowers our breakeven point, and keeps the trade alive with a more defined risk and reward.
Let’s break that down a little…
What Is a Vertical Spread?
Simply put, vertical spreads are positions that require us to buy and sell options of the same type and expiration date at different strike prices. When we say “vertical,” we’re referring to the position of the strike prices – essentially, one position offsets the other, which defines whether it’s a credit or debit spread.
Here’s a simple rule of thumb… Bullish vertical spreads increase in value when the underlying asset rises. Conversely, bearish vertical spreads profit from a decline in price.
Going a little deeper, a bullish vertical spread would require us to buy a bullish call spread and a bullish put spread. We simply buy the option with the lower strike price and sell the option with the higher strike price.
A bearish vertical spread requires us to use bearish call spreads or bearish put spreads. We then sell the option with the lower strike price and buy the option with the higher strike price.
In both scenarios, we need to understand the role of debits and credits.
Debit, Credit, and Implied Volatility in Vertical Spreads
A credit is simplymoney received in an account. A credit transaction is one in which the net sale proceeds are larger than the net buy proceeds (cost), thereby bringing money into the account.
On the other side, a debit is an expense, or money paid out from an account. A debit transaction is one in which the net cost is greater than the net sale proceeds.
If we think about the examples above, the bullish call spread actually produces a net debit while the bullish put spread results in a net credit at the outset.
When we talk about debits and credits, we’re specifically paying attention to how volatility affects the overall trajectory of our trades. In this sense, we must always be aware of how Implied Volatility (IV) affects our overall thesis. This is a measurement of how much the price of an option’s underlying stock is expected to fluctuate over the life of the options contract (non-directional).
Now that we have some terms in mind for understanding how vertical spreads work, let’s take a high-level look at the different types of vertical spreads…
The Types of Vertical Spreads
Long Call Spread (Bull Call Spread): This is a bullish, defined-risk strategy where we trade a long and short call on the same underlying asset within the same expiration date at different strikes. The short call strike is higher than the long call strike. This places a ceiling on our profit potential in the long call while covering the overall risk and cost of the position. You’ll capture a maximum profit if the market price is at or above the short call strike price at expiry. Your maximum loss would occur if the underlying price is at or below the long call strike price.
Short Call Spread (Bear Call Spread): This vertical spread is a bearish, defined-risk strategy where we trade a short and long call at different strikes using the same expiration. Both strikes are out of the money (OTM), with the short strike being closer to the stock price. If the position expires worthless and OTM at expiration, your maximum profit potential is the credit received upfront, which is capped at the net premium you collected. Your maximum loss would be the value equal to or above the long call’s strike price. Losses are essentially limited to the difference between the call strikes, minus the net premium collected upfront.
Long Put Spread (Bear Put Spread): This is a bearish, defined-risk strategy made up of a short and long put at different strikes using the same expiry. The strike price of the long put is higher than the short put. The value of a long put vertical spread increases when there’s a drop in the price of the underlying asset. You’d capture the maximum profit potential if the market price at expiration is at or below the short put’s strike price. You’d capture your largest possible loss if it’s equal to or above the long put’s strike price.
Short Put Spread (Bull Put Spread): This is a bullish, defined-risk strategy where we trade a long and short put at different strikes using the same expiry. The strike price of the short put is higher than the long put. This means the value of a short put vertical spread will decrease when there’s a rise in the price of the underlying asset. You’d capture the highest possible profit if the market price at expiration is at or above the short put’s strike price. You’d take the biggest possible loss if it’s equal to or below the long put’s strike price.
The Power of Rolling Into Spreads
With vertical spreads, we have the power to target our upside and downside exposure without risking all of the capital we’ve put up on a single trade.
Many of our positions make use of these kinds of spreads in particular not only because they limit our risk… They also provide us different options for trade management based on whatever the markets throw at us. That’s what’s truly powerful about these trades – they allow us to stay nimble and adapt to wherever our chosen stock is heading.
Define Your Maximum Investment and Risk: Vertical spreads allow us to define and manage the maximum we can possibly lose on any position. Let’s say you’re holding a call option on Apple, and the stock has risen significantly. Instead of simply selling, consider rolling into a vertical spread by selling another call at a higher strike price. Here’s why this is powerful:
How It’s Done: When AAPL rises, you can sell a higher-strike call option against your existing position. This locks in part of your gains and reduces the position’s risk, while still keeping some upside potential. Why It Works: A spread gives you extended exposure to AAPL’s potential rise but with less capital at risk. It’s a favorite approach for traders who want to stay in the game without putting all their chips on the line. Pro Tip: One of the smartest things you can do after a winning options trade is reduce your risk without giving up all your upside. That’s exactly what vertical spreads are designed to do.
By now you understand the basic mechanics of a vertical spread. But knowing how they work is only half the equation. The real advantage is knowing when to use them.
In this video, I walk through why vertical spreads have become one of the cornerstones of my options strategy. Using real trades from our own portfolio, I show how selling a higher-strike option can dramatically reduce your capital at risk, define your maximum loss, and still leave room for substantial gains if the stock keeps moving in your favor.
Rather than simply taking profits and walking away, vertical spreads allow you to stay with your best ideas while steadily shifting the odds in your favor. It’s one of the most effective ways I know to trade with discipline over the long run.
Vertical spreads are just one tool in the toolbox. The real edge comes from understanding why we use them, when to use them, and how they fit into a complete trading plan.
That’s exactly what the Masters in Trading Options Challenge is designed to teach.
I’ll take you step by step through the same process I use every day—finding opportunities, structuring trades with defined risk, managing winners, and protecting your capital along the way. No hype. No guesswork. Just a practical framework you can apply to every trade you make.
If you’re serious about becoming a better options trader, join me inside the Masters in Trading Options Challenge. I think you’ll be surprised how quickly these concepts begin to click—and how much more confident you’ll feel every time you place a trade.
A federal judge rejected Meta Platforms’ bid to dismiss a lawsuit by 29 state attorneys general accusing it of designing Facebook and Instagram to addict children and knowingly concealing the harm from the public.
In a decision late on Monday night, US District Judge Yvonne Gonzalez Rogers in Oakland, Calif., denied Meta’s motion to dismiss claims based on deception, unfair practices and violations of the federal Children’s Online Privacy Protection Act.
The judge also said Meta did not comply with that law’s notice and parental consent requirements, and granted summary judgment to the states on that issue.
Meta’s bid to dismiss a lawsuit by 29 state attorneys general accusing it of designing Facebook and Instagram to addict children and knowingly concealing the harm from the public was rejected. Bloomberg via Getty Images Meta and its lawyers did not immediately respond to requests for comment on Tuesday.
Gonzalez Rogers also oversees related multidistrict litigation by more than 2,600 individuals, school districts and local governments over whether social media platforms such as Facebook, Instagram, Google and YouTube, Snapchat and TikTok addict children.
Meta downplays harms The states said research has shown that children’s use of Facebook and Instagram could lead to depression, anxiety, insomnia, interference with education and daily life, and self-harm including suicide.
Meta countered that the attorneys general had no evidence it misled consumers about its platforms’ alleged addictiveness, including in congressional testimony by Chief Executive Mark Zuckerberg.
The Menlo Park, Calif.-based company said this was because “social media addiction” is not an established psychiatric condition, and therefore statements that its platforms are not addictive could not be false.
The states said research has shown that children’s use of Facebook and Instagram could lead to depression, anxiety, insomnia, interference with education and daily life, and self-harm including suicide. Above, victims’ families after a trial in Los Angeles earlier this year. Andy Johnstone for CA Post
The judge also said Meta did not comply with that law’s notice and parental consent requirements. Getty Images Meta also said it didn’t violate the children’s online privacy law because it directed Facebook and Instagram to a general audience, not just children under age 13.
Judge finds factual disputes about addictiveness In a 38-page decision, Gonzalez Rogers found material factual disputes over whether Meta’s social media platforms are addictive, whether Meta falsely denied it designed them that way, and whether it “partially” directed the platforms at children.
“The AGs present a reasonable interpretation of [Meta’s] statements that Facebook and Instagram are not designed in ways that cause teens to compulsively use the platforms to their detriment,” she wrote. “To the extent plaintiffs’ evidence shows that the platforms are in fact designed to do just that, a jury could reasonably find the statements were untrue to a reasonable person.”
A trial is scheduled for Aug. 18, court records show.
Tesla has begun testing a production version of its Cybercab that has two seats, but no steering wheel or pedals, in Austin, Texas. For now, the testing is being done with a safety monitor in the right passenger seat, according to a video posted on X, the social media platform owned by the electric car maker's CEO Elon Musk.
Alphabet stock is showing positive momentum. What should traders watch with GOOG? What Is Driving Alphabet’s Inclusion in the Dow?S&P Dow Jones Indices said Alphabet will replace Verizon Communications in the Dow Jones Industrial Average, effective before the market opens on June 29. The index provider pointed to Alphabet’s larger market value, higher share price, and exposure to faster-growing areas like advertising, cloud services, AI, hardware, autonomous systems, health technology and digital media distribution.
Alphabet’s AI narrative also remains a swing factor for sentiment after reports that at least five researchers left Google’s core AI team over seven days, including Gemini co-lead Noam Shazeer to OpenAI and DeepMind’s John Jumper to Anthropic.
Alphabet also faces headline risk on the regulatory front with YouTube’s CEO set to testify at a child-safety hearing tentatively scheduled for July 28, after the White House backed the James T. Woods Act and pushed for CEOs to be substituted.
Despite Tuesday’s slight pullback, long-term sentiment received a boost as Morgan Stanley analyst Brian Nowak maintained an Overweight rating on Alphabet and raised the price target from $375 to $415.
Critical Price Levels for GOOG to WatchAlphabet is in a "cooling phase" on the medium-term view: it’s trading 2.1% below the 20-day SMA ($356.25) and 5% below the 50-day SMA ($367.19), but it’s still 3.4% above the 100-day SMA ($337.13) and 10.9% above the 200-day SMA ($314.44). That mix often reads as consolidation inside a broader uptrend, which lines up with the stock’s 96.51% gain over the past 12 months.
MACD is the cleaner momentum lens right now, with the indicator below its signal line and the histogram negative—another way of saying upside pressure has cooled and buyers may need a fresh push to regain control. Structurally, the 20-day SMA sitting below the 50-day SMA is a short-term bearish crossover, but the longer-term golden cross (50-day above 200-day) remains in place after July 2025.
Key Resistance: $373.50 — near the short-term moving-average cluster where rebounds can stall. Key Support: $343.50 — close to the 100-day trend region where buyers have recently defended pullbacks. How Alphabet Generates Revenue and Its Business ModelAlphabet is a holding company that wholly owns internet giant Google, and it still gets slightly less than 90% of revenue from Google services—mostly advertising sales. That same segment also includes subscriptions (like YouTube TV and YouTube Music), platform revenue (Play Store), and devices (Chromebooks, Pixel phones, and smart home products).
Google Cloud contributes roughly 10% of revenue, while bets like Waymo, Verily, and Google Fiber sit in the "other" bucket. In the context of Dow inclusion, the breadth of those business lines is part of why the index provider framed Alphabet as a more representative large-cap exposure to modern growth areas.
Alphabet Stock Strengths and WeaknessesBelow is the Benzinga Edge scorecard for Alphabet Inc. Class C Capital Stock, highlighting its strengths and weaknesses compared to the broader market:
The Verdict: Alphabet Benzinga Edge signal reveals a growth-and-momentum-led profile with very strong quality, but a less compelling value setup. For longer-term bulls, that typically means pullbacks toward support matter more than chasing strength into resistance.
GOOG Stock Price Activity on TuesdayGOOG Stock Price Activity: Alphabet shares were trading at $351.08 at the time of publication on Tuesday, according to Benzinga Pro data.
Image: Shutterstock
Market News and Data brought to you by Benzinga APIs
Investors often turn to recommendations made by Wall Street analysts before making a Buy, Sell, or Hold decision about a stock. While media reports about rating changes by these brokerage-firm employed (or sell-side) analysts often affect a stock's price, do they really matter?
Let's take a look at what these Wall Street heavyweights have to say about Alphabet Inc. (GOOG - Free Report) before we discuss the reliability of brokerage recommendations and how to use them to your advantage.
Alphabet currently has an average brokerage recommendation (ABR) of 1.29, on a scale of 1 to 5 (Strong Buy to Strong Sell), calculated based on the actual recommendations (Buy, Hold, Sell, etc.) made by 55 brokerage firms. An ABR of 1.29 approximates between Strong Buy and Buy.
Of the 55 recommendations that derive the current ABR, 45 are Strong Buy and four are Buy. Strong Buy and Buy respectively account for 81.8% and 7.3% of all recommendations.
Brokerage Recommendation Trends for GOOG
Check price target & stock forecast for Alphabet here>>>
The ABR suggests buying Alphabet, but making an investment decision solely on the basis of this information might not be a good idea. According to several studies, brokerage recommendations have little to no success guiding investors to choose stocks with the most potential for price appreciation.
Do you wonder why? As a result of the vested interest of brokerage firms in a stock they cover, their analysts tend to rate it with a strong positive bias. According to our research, brokerage firms assign five "Strong Buy" recommendations for every "Strong Sell" recommendation.
This means that the interests of these institutions are not always aligned with those of retail investors, giving little insight into the direction of a stock's future price movement. It would therefore be best to use this information to validate your own analysis or a tool that has proven to be highly effective at predicting stock price movements.
Zacks Rank, our proprietary stock rating tool with an impressive externally audited track record, categorizes stocks into five groups, ranging from Zacks Rank #1 (Strong Buy) to Zacks Rank #5 (Strong Sell), and is an effective indicator of a stock's price performance in the near future. Therefore, using the ABR to validate the Zacks Rank could be an efficient way of making a profitable investment decision.
Zacks Rank Should Not Be Confused With ABRAlthough both Zacks Rank and ABR are displayed in a range of 1--5, they are different measures altogether.
The ABR is calculated solely based on brokerage recommendations and is typically displayed with decimals (example: 1.28). In contrast, the Zacks Rank is a quantitative model allowing investors to harness the power of earnings estimate revisions. It is displayed in whole numbers -- 1 to 5.
It has been and continues to be the case that analysts employed by brokerage firms are overly optimistic with their recommendations. Because of their employers' vested interests, these analysts issue more favorable ratings than their research would support, misguiding investors far more often than helping them.
On the other hand, earnings estimate revisions are at the core of the Zacks Rank. And empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements.
In addition, the different Zacks Rank grades are applied proportionately to all stocks for which brokerage analysts provide current-year earnings estimates. In other words, this tool always maintains a balance among its five ranks.
Another key difference between the ABR and Zacks Rank is freshness. The ABR is not necessarily up-to-date when you look at it. But, since brokerage analysts keep revising their earnings estimates to account for a company's changing business trends, and their actions get reflected in the Zacks Rank quickly enough, it is always timely in indicating future price movements.
Should You Invest in GOOG?Looking at the earnings estimate revisions for Alphabet, the Zacks Consensus Estimate for the current year has increased 0.1% over the past month to $14.3.
Analysts' growing optimism over the company's earnings prospects, as indicated by strong agreement among them in revising EPS estimates higher, could be a legitimate reason for the stock to soar in the near term.
The size of the recent change in the consensus estimate, along with three other factors related to earnings estimates, has resulted in a Zacks Rank #2 (Buy) for Alphabet. You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>
Therefore, the Buy-equivalent ABR for Alphabet may serve as a useful guide for investors.
Key Takeaways Alphabet's Dow Jones inclusion strengthens the index's AI and technology exposure. The move is more symbolic for Alphabet, already dominant in major benchmark indexes. DIA could gain if Alphabet and other AI leaders continue their upward momentum. Alphabet (GOOGL - Free Report) shares climbed 4.8% on Monday after the company officially entered the Dow Jones Industrial Average, earning one of Wall Street's most recognizable blue-chip distinctions.
Who Benefits More: Dow Jones or Alphabet?The inclusion is largely symbolic for Alphabet rather than a major catalyst for new demand. Alphabet is already a key component of both the S&P 500 and the Nasdaq-100, where the bulk of passive investment assets are concentrated, as quoted on CNBC.
However, the addition marks a major milestone for the Dow Jones index, shifting its focus away from traditional telecommunications toward artificial intelligence and other key tech areas.
Note that a recent tech entrant to the Dow Jones — NVIDIA (NVDA - Free Report) — has struggled to deliver significant gains, with NVDA up only 3.2% this year. NVDA officially joined the Dow Jones Industrial Average on Nov. 8, 2024. But Alphabet stock has gained 11.4% so far this year and has surged 98% over the past year (as of June 26, 2026).
Investors Question Returns on AI SpendingDespite Monday's advance, Alphabet remains on pace for its weakest monthly performance since February 2025, as quoted on the same CNBC article. The stock has declined in six of the past seven weeks, a stark contrast to May.
Growing concerns over the effectiveness of Alphabet's massive AI investments continue to weigh on sentiment. Competition from lower-cost Chinese models is intensifying, putting downward pressure on pricing.
China’s DeepSeek has indicated that the fourth version of its open-source model will be released within weeks. Competition from rivals like Anthropic and OpenAI is an additional headwind.
Compute Constraints Create New PressuresAlphabet reportedly lacks sufficient compute capacity to satisfy enterprise demand, including requirements from clients such as Meta. To address the shortfall, the company has turned to infrastructure partners, the same CNBC article noted.
Dow Jones Likely to Benefit Since the Dow Jones is a price-weighted index rather than a market capitalization-weighted one, a stock's influence is determined by its share price rather than its overall size. Alphabet was added to replace Verizon — which had a much lower, less influential stock price.
At its debut (with Alphabet's share price at around $350 at the time of writing), the move translated to approximately 4% of the index's total movement. Note that the Information Technology sector accounted for about 16% of the Dow Jones at the time of writing.
Any significant positive move in AI stock prices can benefit the Dow Jones more significantly following Alphabet’s entry into the index. The State Street SPDR Dow Jones Industrial Average ETF Trust (DIA - Free Report) should reflect the potential Alphabet-led benefit in the coming days. However, concerns about an AI bubble are a risk.
HomeIndustriesInternet/Online ServicesTech StocksTech StocksInvestors are overlooking the potential of Alphabet’s custom-chip business as the company plans to expand its data-center capacity going into 2028, according to Morgan StanleyJune 30, 2026, 11:27 a.m. ET
Alphabet and other “Magnificent Seven” names have fallen out of favor in recent weeks as investors pivot toward memory companies on the receiving end of the hyperscalers’ heavy artificial-intelligence spending.
That creates an opportunity for investors to take advantage of recent weakness in shares of Alphabet GOOGL GOOG as the company ramps up its custom-chip business, according to Morgan Stanley analyst Brian Nowak.
The Trade Desk (TTD) shares fell 4% in premarket trading Tuesday after Arete Research downgraded the digital advertising technology company to Sell from Neutral
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Dow Jones Futures: Stock Market Rallies On U.S.-Iran News; Alphabet, Rocket Lab, SpaceX, Tesla Are Big Winners Artificial intelligence is making its way into investors' portfolios one way or another, whether they're buying AI stocks or abstaining altogether. The latest signal of inevitability was Tuesday's announcement of Google's "strategic partnership" with FactSet, which will see the financial data company deepen its ties with Gemini and Google Cloud. FactSet (FDS) has offered AI features since at least March…
As companies struggle to integrate AI, they’re increasingly ready to bring in outside help — and service providers are launching new purpose-built groups to make sure they get it.
On Tuesday, Amazon Web Services (AWS) launched a new internal organization for AI-focused forward-deployed engineers. Engineers on the new team will embed within companies to deploy purpose-built agents, focusing on fast engagements and customer self-sufficiency.
In a post announcing the new org, AWS VP of Frontier AI Francessca Vasquez emphasized that the org would do more than build and maintain requested systems. “Customers leave AWS FDE deployments with both new solutions and new engineering capabilities,” the announcement reads. “Along with agentic systems running in their own AWS environment, they gain lasting AI skills, workflows, and patterns they can use to innovate independently.”
Amazon says $1 billion will be committed to the new org, although the figure represents internal Amazon resources rather than a joint venture or conventional investment.
Pioneered by Palantir, the forward-deployed engineer (FDE) model has become increasingly popular as a way to manage AI deployments. In a typical FDE system, an engineer from the contracting company (in this case, AWS) works for the client temporarily while the system is being established, allowing them to respond directly as internal opportunities or challenges emerge.
In the FDE model, much of the relevant technology can be reused between deployments, while still being tailored to the specifics of each company’s needs and workflows. It also gives the client company an influx of expertise and puts primary responsibility for the deployment in the hands of the contractor. The biggest downside is the labor involved, since it means maintaining a full corps of FDE engineers to install and maintain the company’s technology.
Both OpenAI and Anthropic have launched their own FDE joint ventures in recent months, valued at $4 billion and $1.5 billion, respectively. In those two cases, the AI labs were paired with private equity firms, which provided both the capital to launch and connections with client corporations in their portfolios.
When you purchase through links in our articles, we may earn a small commission. This doesn’t affect our editorial independence.
Russell Brandom has been covering the tech industry since 2012, with a focus on platform policy and emerging technologies. He previously worked at The Verge and Rest of World, and has written for Wired, The Awl and MIT’s Technology Review. He can be reached at [email protected] or on Signal at 412-401-5489.
Amazon Web Services on Tuesday announced it is investing $1 billion in a new Forward Deployed Engineering unit that will help its customers build and roll out artificial intelligence systems.
A forward-deployed engineer, or an FDE, is an employee who is embedded directly within a different business to try and accelerate a technical transformation. Defense contractor Palantir coined the term more than a decade ago, but it's seen a resurgence among software vendors looking to boost adoption by taking talent directly into clients' facilities.
Leading model developers, including OpenAI and Anthropic, announced their own FDE companies earlier this year, in partnership with banks, private equity and consulting firms. Now, AWS is looking to carve out its own piece of the market.
"We've had capabilities over the years, but structurally this is like getting everybody together in one business unit with a common rubric of deployment," Francessca Vasquez, AWS' vice president of frontier AI engineering and services, said in an interview. "It's the first time we're doing it in that way."
Amazon, which is the top cloud provider by revenue, is the first hyperscaler to announce this kind of initiative.
Vasquez said AWS' new unit will be seeded with "thousands" of FDEs. An initial pod of roughly five or six engineers will be embedded within an AWS customer at a time, and those employees will also work alongside AI agents, which are tools that can independently complete tasks on behalf of their users.
AWS said in a blog post that its FDE embeds will partner closely with customers' business, engineering and security staffers, and they'll look to leave behind self-sufficient teams with new solutions and capabilities in a matter of weeks.
"The currency that the customers are always talking about right now is speed," Vasquez said. "We do see FDE being a choice for customers who are looking for accelerated value back to their stakeholders, their customers, their executive teams."
Read more CNBC tech newsThe memory shortage shaking Apple and Microsoft is 'existential crisis' for smaller playersThe AI boom is colliding with a new threat: Severe weatherChina's Zhipu is closing in on top U.S. AI models with Anthropic and OpenAI held backHow GE Vernova builds the massive gas turbines powering the AI data center boomIn May, Anthropic announced it had formed a new "AI services company" with Blackstone, Hellman & Friedman and Goldman Sachs to help mid-sized businesses deploy its Claude AI models.
Days later, Anthropic's chief rival, OpenAI, announced the OpenAI Deployment Company alongside TPG, Advent International, Bain Capital, Brookfield Asset Management and other firms. It said the new organization would expand OpenAI's ability to embed FDEs into companies that are working on "complex problems in demanding environments."
Amazon has poured billions of dollars into both Anthropic and OpenAI, but Amazon executives have not been shy about their ambitions to compete directly with the labs in some areas. A spokesperson for AWS said the company expects to have the opportunity to work with the FDE companies from OpenAI and Anthropic, and it will share more details about its partner programs in the near future.
Organizations including the Allen Institute, the National Basketball Association, Ricoh and the National Football League are already working with AWS FDEs, according to the company. Vasquez said companies in highly regulated industries with diverse datasets will be the next group of adopters.
"This is for customers that are really looking at ways to evolve their workflows," Vasquez said.
Amazon is highlighting the fuel savings benefits of Prime membership with a limited-time promotion that offers 50 cents per gallon off one fuel purchase over the Fourth of July holiday weekend.
The promotion runs from Thursday to Sunday (July 2 to 5), the company said in a Tuesday (June 30) press release.
To participate in the limited-time offer, Prime members can link their Amazon account to bp’s fueling app, earnify; visit one of 7,500 bp, Amoco, and participating ampm and Thorntons locations across the United States; and enter their phone number or use the earnify app.
Members who have added a family member to their Prime account via Amazon Family can apply the limited-time promotion to two fuel transactions. Each member must have their own earnify account, and each can make one fuel purchase under the promotion, according to the release.
Beyond this promotion, Prime members can save 10 cents per gallon year-round at the participating gas stations. To use this benefit, members must activate it once to connect their Prime account with their earnify account.
“They can simply begin redeeming at the pump by inputting their phone number or linked payment method,” the release said. “Alternately, members can redeem at the pump with the free earnify app by selecting their location and pump they are using. And with earnify, Prime members can find even more ways to save on fuel or in-store.”
Amazon added fuel savings of 10 cents per gallon at the participating gas stations as a benefit of Prime membership in October 2024.
PYMNTS reported at the time that the move signified a strategic effort to increase the value of Prime membership amid rising fuel prices and heightened competition.
Rival retailer Walmart had introduced similar fuel saving in its Walmart+ loyalty program four years earlier and increased the discounts in 2022.
Jamil Ghani, vice president of Amazon Prime, said in an October 2024 press release: “We’re constantly looking to add more value for Prime members and perhaps the broadest and most popular additional benefit we could offer is fuel savings—we’re excited to give this to Prime members.”
The PYMNTS Intelligence report “When the Drive Isn’t Worth the Pay: How Fuel Costs Reshape Who Can Afford to Work“ found that transportation costs are now shaping labor availability, job reliability and worker financial health.
In a note released Monday, the firm sees the combination of stronger June retail data and a 20% price increase on select AWS GPU workloads as setting up a cleaner second-half growth story for the stock.
AMZN stock is moving. See the chart and price action here. Prime Day DeliversAdobe Analytics data show U.S. online retail spend during the Prime Day window at roughly $26.4 billion, up 9% year over year, a result that lines up with Bank of America’s expectation for mid-single-digit global GMV growth as some international events move into the third quarter.
Discounts were broadly similar to last year, but Numerator data flagged an 11% drop in average order value on Amazon and softer satisfaction scores, pointing to a customer shift toward everyday essentials and grocery rather than big-ticket items.
Even with smaller baskets, BofA still expects Amazon’s North America retail segment to slightly beat Street estimates for about 14% year-over-year growth.
The catch for near-term traders is timing. Bank of America estimates around $7 billion to $8 billion of sales likely shifted into the second quarter from the third quarter due to this year’s Prime Day schedule, creating potential noise around Amazon’s Q3 outlook even if full-year fundamentals remain intact.
AWS Price HikeOn the cloud side, Amazon quietly announced a roughly 20% price increase effective July 1 for EC2 Capacity Blocks tied to GPU-heavy machine-learning workloads, following a prior 15% hike in January.
Bank of America’s work suggests effective prices paid by customers have already risen from 2022 trough levels, and the new adjustment should add an estimated 1–2 percentage points to second-half AWS growth.
Beyond core capacity, the firm points to ramping commitments from OpenAI and Anthropic on AWS infrastructure, reinforcing a view that Amazon is leaning into AI demand with greater pricing discipline.
BofA flags some risks including tougher competition from offline and local retailers, cloud share battles in advanced AI and heavy AWS investment that could pressure margins if macro conditions soften.
Still, with solid Prime Day demand and AWS asserting pricing power in AI workloads, Amazon’s stock remains a key name to watch as the market balances short-term guidance noise against a strengthening multi-year thesis.
AMZN Stock Price Activity: Amazon stock was down 0.86% at $238.07 at the time of publication Tuesday, according to data from Benzinga Pro.
Over the past month, AMZN has declined about 10.6% versus a 1.6% decline in the S&P 500 and is up roughly 3% year-to-date compared to the index’s 8.4% gain.
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This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
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Key Takeaways Microsoft is on track for its worst month since 2000 after a 20% June decline and AI spending concerns. MSFT plans $190B in capital spending through 2026, raising investor worries over profit margins. ETFs like VGT provide diversified tech exposure with Microsoft among their top holdings. According to recent data published by Bloomberg, Microsoft (MSFT - Free Report) is heading for its worst month since the dot-com era. The stock has lost 20% so far in June, putting it on course for its steepest monthly decline since December 2000, when it lost 24.4%.
While this brutal selloff, which erased more than $570 billion in this software giant’s market value, may have deeply disappointed near-term investors, some may view this as a compelling dip-buying opportunity.
Rather than betting on a single stock and losing havoc with its sudden freefall as it happened with MSFT, gaining exposure to tech exchange-traded funds (ETFs) holding Microsoft alongside other silicon giants may offer a more prudent strategy.
Before identifying those ETFs, it is important to understand what caused Microsoft's decline, whether it is well positioned to regain its momentum over the long term, and why tech ETFs may offer a more diversified and potentially safer investment strategy.
What Caused Microsoft’s Freefall?The recent slump witnessed in Microsoft's share price stems primarily from growing investor skepticism surrounding its massive artificial intelligence (AI) expenditures, with the company announcing during its fiscal third-quarter results that it expects $190 billion in capital expenditures through the end of 2026.
This expense plan by Microsoft, which exceeded Wall Street expectations, made investors increasingly anxious about how long it will take for multi-billion-dollar infrastructure investments to translate into robust profit margins.
Market experts have also expressed concern about margin compression in MSFT’s Azure cloud-computing business. Although Azure remains the company's fastest-growing segment, operating AI infrastructure is generating significantly lower gross margins than Microsoft's traditional on-premises software business.
Consequently, anxiety among investors has been building up over the past few months, leading to repeated sell-offs in MSFT's shares and a cumulative year-to-date decline of approximately 24%.
Will MSFT Rebound?Looking at historical data and underlying valuations, Microsoft's long-term growth prospects remain healthy. The company's forward price-to-earnings (P/E) ratio sits at a premium of around 19.1X compared to its peer group’s 15.68X, which, while high, is justified by its dominant enterprise footprint and expanding cloud ecosystem.
The stock boasts a four-quarter average earnings surprise of 8.43% and a long-term (three-to-five years) earnings growth rate of 16.60%, which beat the industry’s growth rate of 12.40%.
The Zacks Consensus Estimate for MSFT’s fiscal 2026 and 2027 revenues implies year-over-year growth of 17% and 16%, respectively.
Microsoft's fundamental ability to monetize generative AI through its Azure platform and increased GitHub Copilot usage should help it achieve these targets, thereby positioning it to make a solid rebound in the long term.
The stock’s short-term average price target of $554.04 reflects an increase of 48.55% from its last closing price of $372.97, implying a substantial upside from its current discounted price.
The Rationale Behind Choosing Tech ETFsEven with Microsoft's solid potential for recovery, as mentioned above, some investors may remain skeptical given the recent downturn. For these cautious market participants, tech ETFs represent an excellent investment alternative.
From a diversification standpoint, ETFs help mitigate the single-stock risk associated with holding an individual company, reducing the impact of earnings-related volatility. Rapid AI acceleration is already boosting the broader tech industry to unprecedented heights.
Although the tech sector has witnessed notable macro sell-offs recently, the ultimate long-term potential of the industry remains robust, thanks to secular tailwinds like enterprise cloud migration, cybersecurity expansion, and advanced semiconductor manufacturing. Thus, capitalizing on this broad momentum via tech ETFs allows investors to participate in the AI revolution without exposing their portfolios to the vulnerability of a single corporate balance sheet.
Tech ETFs to BuyWith AI infrastructure spending from major hyperscalers expected to reach approximately $725 billion in 2026, one may consider the following tech ETFs to buy on this historic Microsoft dip:
Vanguard Information Technology Index Fund ETF Shares (VGT - Free Report)
This fund, with net assets worth $170.1 billion, offers exposure to 323 companies from the following industries: technology software and services, technology hardware and equipment, and semiconductor and semiconductor equipment manufacturers. NVIDIA (NVDA - Free Report) holds the first spot in this fund, with 16.77% weightage, while MSFT holds the third spot with 9.87% weightage.
VGT has rallied 23.6% year to date. The fund charges 9 basis points (bps) as fees and traded at a good volume of 4.46 million shares in the last trading session. It sports a Zacks ETF Rank #1 (Strong Buy).
Fidelity MSCI Information Technology Index ETF (FTEC - Free Report)
This fund, with net assets worth $21.38 billion, offers exposure to 287 information technology stocks. NVDA holds the first spot in this fund, with 16.73% weightage, while MSFT holds the third spot with 9.40% weightage.
FTEC has rallied 23.9% year to date. The fund charges 8 bps as fees and traded at a volume of 0.26 million shares in the last trading session. It sports a Zacks ETF Rank #1.
State Street Technology Select Sector SPDR ETF (XLK - Free Report)
This fund, with assets under management (AUM) worth $120.67 billion, offers exposure to 74 companies from technology hardware, storage and peripherals; software; communications equipment; semiconductors and semiconductor equipment; IT services; and electronic equipment, instruments and components industries. NVDA holds the first spot in this fund, with 14.80% weightage, while MSFT holds the third spot with 8.79% weightage.
XLK has surged 28.8% year to date. The fund charges 8 bps as fees and traded at a good volume of 11.85 million shares in the last trading session. It sports a Zacks ETF Rank #1.
iShares U.S. Technology ETF (IYW - Free Report)
This fund, with net assets worth $24.80 billion, offers exposure to 148 software, semiconductors, and tech hardware companies in the United States. NVDA holds the first spot in this fund, with 12.94% weightage, while MSFT holds the third spot with 8.48% weightage.
IYW has risen 23.3% year to date. The fund charges 38 bps as fees and traded at a volume of 0.48 million shares in the last trading session. It sports a Zacks ETF Rank #1.
There's more than one way to invest successfully. In fact, strategic differentiation may be necessary to outperform the market. The most successful investors all have unique strategies and characteristics that separate their portfolios from the rest of the pack.
Nonetheless, you can still find some commonalities among billionaire portfolio managers that lead them to make similar investments at times. For example, Bill Ackman, Jeremy Grantham, and Cliff Asness all made substantial investments in the same stock last quarter. And investors currently have an opportunity to pick up shares at an even better price than what the billionaire fund managers may have paid earlier this year.
Here's why Microsoft (MSFT +1.07%) fits into each billionaire's portfolio and why the stock still looks severely undervalued today.
Image source: Getty Images.
Long-term investors seeking value in today's market Ackman, Grantham, and Asness are all titans in the investment management space. Ackman runs Pershing Square, Grantham is the G in GMO, and Asness founded AQR Capital Management. They each disclosed substantial increases in Microsoft in their most recent quarterly filings with the Securities and Exchange Commission (SEC).
Pershing Square Capital Management bought about $2 billion worth of the stock, making it one of the fund's biggest positions. Ackman also disclosed purchasing the stock for his new fund, Pershing Square USA. GMO bought over 900,000 shares of Microsoft in the first quarter, making it the fund's top holding. AQR increased its stake in Microsoft by 60%, pushing it to become its second-largest position. Ackman, Grantham, and Asness are all focused on long-term horizons in their investing, and they typically pay close attention to valuation.
Ackman prefers to concentrate on intrinsic value, buying stocks with durable competitive advantages when the market offers a good price. Ackman noted Microsoft's leadership in cloud computing and enterprise software as reasons for his purchase.
Grantham prefers companies with strong recurring cash flow and tries to avoid cyclicality. He's best known for warning against bubbles and harnessing the power of mean reversion. While Microsoft is heavily tied to the much-hyped artificial intelligence (AI) trade, Grantham may still see value in the company thanks to its strong cash-flow generation.
Asness uses quantitative models that balance value and momentum investing as well as several other factors. That makes his portfolio much more systematic rather than fully based on fundamental analysis. Microsoft likely fills the role of a high-quality stock trading at a great value relative to its durable earnings growth.
Today's Change
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Investors are getting a great opportunity to follow these billionaires From a long-term fundamentals standpoint, Microsoft appears severely undervalued by the market. The stock currently trades at its lowest level since the start of 2024 despite strong revenue growth across both its cloud computing and enterprise software segments.
Azure, the cloud computing business, generated 40% revenue growth last quarter. Management expects that rate to accelerate in the back half of the year. That's supported by a massive backlog of $627 billion in contracted revenue, with about 25% expected to be recognized over the next 12 months.
Meanwhile, Microsoft's enterprise software segment, which includes Microsoft 365 and Dynamics 365, posted 17% year-over-year revenue growth last quarter. That was driven by the commercial adoption of its Copilot AI assistant and higher consumer prices. The former still has a long way to go as Microsoft pushes to make Copilot a standard addition to Microsoft 365 and its 450 million users. It currently counts just 20 million paid commercial Copilot users.
Microsoft should be able to grow revenue at a solid double-digit pace for the foreseeable future as demand for its cloud compute grows and it sells more Copilot subscriptions. Both should ultimately lead to improved operating margins even though the company already operates at a relatively high margin. With the stock trading for just 21 times earnings, it seems an absolute bargain at today's price. It's no wonder it's caught the eye of several of the top fund managers in the world.
Key Takeaways Microsoft added Mphasis to MISA, expanding its partner-led security ecosystem and Marketplace presence.Microsoft Build unveiled new AI security tools, including MDASH and Microsoft Agent 365 integrations.MSFT reported 18% revenue growth as cloud, Azure and security-enabled Microsoft 365 adoption accelerated. Microsoft Corporation (MSFT - Free Report) continues to deepen its cybersecurity ecosystem, with IT solutions provider Mphasis joining the Microsoft Intelligent Security Association (MISA), building on an existing collaboration centered on Microsoft Sentinel, Entra, Intune, Purview, Defender and Microsoft 365 Copilot. Mphasis' managed security services are already listed on Microsoft Marketplace, reinforcing the company's strategy of expanding its security footprint through a growing partner ecosystem rather than organic development alone. The move follows a string of security-focused announcements at Microsoft Build in early June 2026, including the limited preview of "Codename MDASH," an agentic vulnerability-detection capability that pairs Microsoft Defender with GitHub Code Security and new integrations within Microsoft Agent 365 aimed at securing AI agents and identities.
These developments arrive against a backdrop of strong underlying financial momentum. In its fiscal third-quarter 2026 results, reported April 29, 2026, Microsoft posted total revenues of $82.9 billion, up 18% year over year, with Intelligent Cloud revenues rising 30% to $34.7 billion and Azure growth accelerating to 40%. Management noted that Microsoft 365 Commercial cloud revenues grew 19%, helped by the adoption of Microsoft 365 E5 and Copilot, both of which bundle security and compliance capabilities. The company’s security stack now processes 100 trillion daily signals, and Microsoft Entra has surpassed one billion monthly active users, underscoring the scale at which the security business now operates alongside cloud and productivity.
The picture is not without risk. Security still rides on the broader AI infrastructure buildout, where capital expenditure remains elevated and gross margins have come under pressure from compute investment. Execution also depends on converting partner integrations like Mphasis into measurable seat and consumption growth rather than announcements alone. Nonetheless, the combination of accelerating cloud growth, expanding partner reach and steady product releases suggests Microsoft's security business is moving from a supporting feature toward a more distinct growth contributor within its broader portfolio.
Competitive Landscape: CrowdStrike and Palo Alto NetworksMicrosoft's security expansion plays out alongside two established U.S.-listed rivals, CrowdStrike (CRWD - Free Report) and Palo Alto Networks (PANW - Free Report) , both pursuing platform consolidation strategies of their own. CrowdStrike has built its identity around the cloud-native Falcon platform, leaning on endpoint and identity protection, while Palo Alto Networks has pursued an acquisition-driven path toward a unified security operating model spanning network, cloud and AI-driven detection. Unlike Microsoft, neither CrowdStrike nor Palo Alto Networks can pair security with a dominant productivity or hyperscale cloud franchise, leaving bundling and cross-selling as Microsoft's structural advantage even as CrowdStrike and Palo Alto Networks continue to compete aggressively on specialized capability and platform depth.
MSFT’s Share Price Performance, Valuation & EstimatesMSFT shares have lost 23.7% in the past six-month period compared with the Zacks Computer – Software industry’s decline of 25.3%. The Zacks Computer and Technology sector has appreciated 15.8% in the same time frame.
MSFT’s 6-Month Price Performance
Image Source: Zacks Investment Research
From a valuation standpoint, MSFT stock appears overvalued, trading at a forward 12-month price/earnings ratio of 19.11X, higher than the industry’s 18.83X. MSFT has a Value Score of C.
MSFT’s Valuation
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for MSFT’s fiscal 2026 earnings is pegged at $17.33 per share. The estimate indicates 27.05% year-over-year growth.
Microsoft currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
, /PRNewswire/ -- The Law Offices of Howard G. Smith announces that investors with substantial losses have opportunity to lead the securities fraud class action lawsuit against Microsoft Corporation ("Microsoft" or the "Company") (NASDAQ: MSFT).
IF YOU ARE AN INVESTOR WHO SUFFERED A LOSS IN MICROSOFT CORPORATION (MSFT), CONTACT THE LAW OFFICES OF HOWARD G. SMITH BEFORE AUGUST 11, 2026 (LEAD PLAINTIFF DEADLINE) TO PARTICIPATE IN THE ONGOING SECURITIES FRAUD LAWSUIT.
Contact the Law Offices of Howard G. Smith to discuss your legal rights by email at [email protected], by telephone at (215) 638-4847 or visit our website at www.howardsmithlaw.com.
What Is The Lawsuit About?
The complaint filed alleges that, between May 1, 2025 and January 28, 2026, Defendants failed to disclose to investors: (1) that Microsoft's Copilot family of products had experienced significant brand positioning, user experience, usage, data siloing, computational capacity, organizational, and interoperability problems; (2) that Microsoft's flagship proprietary AI model ranked well below competitors on a number of benchmark tests; (3) that Microsoft needed to increase by billions of dollars its capital expenditures and divert GPU and CPU capacity away from fulfilling demand for its profitable Azure services in order to improve the competitive positioning of its critical Copilot family of products and increase its AI-related R&D; (4) that, as a result of the foregoing, Microsoft had failed to convert a significant percentage of its commercial Microsoft 365 users to paid Copilot subscriptions and the Company's Copilot offerings had lost market share to rival products, a trend that was increasing; and (5) as a result, Defendants' positive statements about the Company's business, operations, and prospects were materially misleading and/or lacked a reasonable basis at all relevant times.
Contact Us To Participate or Learn More:
If you wish to learn more about this class action, or if you have any questions concerning this announcement or your rights or interests with respect to the pending class action lawsuit, please contact:
Howard G. Smith, Esq.,
Law Offices of Howard G. Smith,
3070 Bristol Pike, Suite 112,
Bensalem, Pennsylvania 19020,
Call us at: (215) 638-4847
Email us at: [email protected],
Visit our website at: www.howardsmithlaw.com.
To be a member of the class action you need not take any action at this time; you may retain counsel of your choice or take no action and remain an absent member of the class action.
This press release may be considered Attorney Advertising in some jurisdictions under the applicable law and ethical rules.
Contact Us:
Law Offices of Howard G. Smith
Howard G. Smith, Esquire
215-638-4847
[email protected]
www.howardsmithlaw.com
Here at Zacks, we offer our members many different opportunities to take full advantage of the stock market, as well as how to invest in ways that lead to long-term success.
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Also included in Zacks Premium is the Focus List. This is a long-term portfolio of top stocks that have all the traits to beat the market.
Breaking Down the Zacks Focus ListBuilding an investment portfolio from scratch can be difficult, so if you could, wouldn't you take a peek at a curated list of top stocks?
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Focus List MethodologyWhen stocks are picked for the Focus List, it reflects our enduring reliance on the power of earnings estimate revisions.
Earnings estimates, or expectations of growth and profitability, come from brokerage analysts who track publicly traded companies; these analysts work together with company management to analyze every aspect that may affect future earnings, like interest rates, the economy, and sector and industry optimism.
What a company will earn down the road also needs to be taken into consideration, and this is why earnings estimate revisions are so important.
When a stock receives upward earnings estimate revisions, it will likely get even more positive changes in the future. For instance, if an analyst raised their earnings outlook last month, they'll probably do so again this month, and other analysts will follow.
Harnessing the power of earnings estimate revisions is where the Zacks Rank comes in. The Zacks Rank, which is a unique, proprietary stock-rating model, employs earnings estimate revisions to make it easier to build a winning portfolio.
The Zacks Rank consists of four main pillars: Agreement, Magnitude, Upside, and Surprise. Each one is given a raw score, which is recalculated every night and compiled into the Rank. Then, stocks are classified into five groups, ranging from "Strong Buy" to "Strong Sell," using this data.
The Focus List is comprised of stocks hand-picked from a long list of #1 (Strong Buy) or #2 (Buy) ranked companies, meaning that each new addition boasts a bullish earnings consensus among analysts.
Since stock prices respond to revisions, it can be very profitable to buy stocks with rising earnings estimates. By buying Focus List stocks, then, you're likely getting into companies whose future earnings estimates will be raised, potentially leading to price momentum.
Focus List Spotlight: Advanced Micro Devices (AMD - Free Report) Advanced Micro Devices has strengthened its position in the semiconductor market on the back of its strong product portfolio. Santa Clara, CA-based AMD generated revenues of $34.64 billion in 2025. The company reports operations under three segments – Data Center, Client and Gaming, and Embedded – which accounted for 48%, 42%, and 10% of revenues, respectively.
AMD, a #3 (Hold) stock, was added to the Focus List on May 19, 2025 at $117.17 per share. Since then, shares have increased 360.43% to $539.49.
17 analysts revised their earnings estimate higher in the last 60 days for fiscal 2026, while the Zacks Consensus Estimate has increased $0.55 to $7.18. AMD also boasts an average earnings surprise of 6.5%.
Earnings for AMD are forecasted to see growth of 72.2% for the current fiscal year as well.
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Advanced Micro Devices (AMD +7.61%) stock skipped 3.5% higher through 10:30 a.m. ET Tuesday, and you can thank Wells Fargo for that.
In a note this morning, Wells analyst Aaron Rakers raised his price target on AMD stock to $615 per share, implying he sees 10% upside over the next year.
Image source: Advanced Micro Devices.
Why Wells Fargo likes AMD stock 10% may not sound like much in today's overheated stock market -- especially for a semiconductor stock! But Rakers likes AMD's prospects regardless, writing today on StreetInsider that he sees AMD earning about 3% more than other analysts in calendar year 2027 ($13.40 per share), and 8% more in 2028 ($18.75 per share) -- and on course to a near-term peak earning around $20 per share.
Strong demand for computer CPUs underlies Rakers' bull thesis, driving up chip prices.
The biggest growth will arrive this year, with revenue expected to rise 68% again 2025 numbers, followed by 28% growth in 2027 and 22% more in 2028 -- leaving AMD with annual CPU revenue of about $25 billion. GPU numbers should look even better -- $15.6 billion this year, shooting up to $40.6 billion in 2027 and $63 billion in 2028.
Today's Change
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What's next for AMD stock Big picture, Rakers is seeing a shift from artificial intelligence training (building LLMs) to AI inference (AI answering questions), giving AMD a chance to reset the board and catch up to AI leader Nvidia (NVDA +1.61%) by selling more "high core-count server CPUs" in addition to GPUs.
Success isn't guaranteed, though, with Nvidia beginning its Vera CPU push. And at 180 times trailing earnings, AMD is hardly a cheap stock -- arguably six times more expensive than Nvidia at 30 times earnings!
Following Wells Fargo into this trade might not be the right move.
Rich Smith has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Advanced Micro Devices and Nvidia. The Motley Fool has a disclosure policy.
I keep hitting the buy button on AMD because Lisa Su has stopped chasing NVIDIA and started co-designing the next phase of AI infrastructure alongside it. Every few months I tell myself the position is full, and every few months AMD (NASDAQ:AMD | AMD Price Prediction) gives me a fresh reason to add. The May earnings report was the latest one, and I have been adding into it ever since.
Here is what pulls me back. AMD is a fully integrated rack-scale AI vendor now, with Meta, AWS, Google Cloud, Microsoft Azure, Tencent, and OpenAI all signing multi-year roadmaps against EPYC CPUs and Instinct accelerators. The Meta deal alone covers up to 6 gigawatts of AMD Instinct GPUs, the OpenAI partnership another 6 gigawatts, and Oracle is standing up the first public AI supercluster on Helios with 50,000 GPUs in Q3 2026. That is the part of the story I think the market still underprices.
The numbers that keep me buying The first reason is the engine. Q1 2026 revenue came in at $10.25 billion, up 37.85% year over year, with the Data Center segment at $5.78 billion and 57% growth. Non-GAAP EPS of $1.37, beating the $1.2939 consensus estimate. Q2 guidance points to roughly $11.2 billion in revenue, about 46% year over year, with server CPU revenue expected to grow more than 70% year over year. That is acceleration, not deceleration, in the same window the bears swore would crack.
The second reason is visibility. Lisa Su told analysts she now sees “tens of billions of dollars in annual Data Center AI revenue in 2027” and a server CPU total addressable market climbing to over $120 billion by 2030, where she expects to capture greater than 50% share. The long-term EPS target she put on the table is more than $20. I am willing to underwrite that because she has delivered every architectural milestone she has promised for a decade.
The third reason is the balance sheet behind the ambition. AMD ended Q1 with $5.59 billion in cash, a debt-to-equity ratio of 0.071, and interest coverage of 28.2x. Full-year 2025 free cash flow hit $5.52 billion, up 129.48%, and Q1 alone produced $2.57 billion in free cash flow, up 252.96%. The company bought back $1.316 billion of stock in FY2025. This is a fortress funding an offensive.
The risk I refuse to look away from Two things genuinely worry me. The valuation is rich at a P/E above 200, and U.S. export controls on the MI308 already cost AMD roughly $440 million in net inventory and related charges in FY2025. Geopolitics can take a knife to the China line at any moment. I keep buying anyway because the Meta, OpenAI, and hyperscaler commitments sit outside that China exposure entirely, and a forward P/E of 74 against guided 46% revenue growth is a multiple I can live with on a name compounding free cash flow this fast.
Why the buy button stays active Lisa Su is engineering the only credible portfolio that can sell a customer the CPU, the GPU, the rack, and the software in one conversation. As long as she keeps pulling 2027 demand forward and the free cash flow keeps tripling, I will keep adding to AMD with both hands.
Act now: the analyst who called NVIDIA in 2010 just named his top 10 AI stocks — and AMD didn't make the cut. Grab the names FREE today.
Key Takeaways Alibaba is integrating AI across its consumer platforms to improve search, discovery and shopping experiences.BABA is investing in fulfillment efficiency and unit economics to improve the profitability of quick commerce.BABA's quick commerce orders rose 2.7 times year over year, boosting engagement across its retail ecosystem. Alibaba's (BABA - Free Report) digital commerce strategy is evolving into a more integrated, AI-enabled retail ecosystem that could support growth in fiscal 2027. Rather than relying solely on gross merchandise volume expansion, Alibaba is enhancing merchant productivity, consumer engagement and platform monetization across Taobao, Tmall and its instant commerce offerings. The company has also revamped its merchant development program by linking platform subsidies to merchants' marketing spend, an initiative aimed at improving advertising penetration and long-term monetization. These efforts are already gaining traction, with customer management revenue (CMR) increasing 8% year over year on a like-for-like basis in the March quarter, while China E-commerce Group revenues rose 6% to RMB 122 billion.
Quick commerce has become a strategic extension of Alibaba's broader retail platform rather than a standalone business. Order volume expanded 2.7 times year over year, supporting stronger growth at Freshippo and Tmall Supermarket while helping drive double-digit monthly active consumer additions for the Taobao app. At the same time, the integration of the Qwen app with Taobao, Tmall, Alipay, Amap and Fliggy is embedding AI-driven search, discovery and shopping assistance across Alibaba's consumer ecosystem, creating additional opportunities to improve user engagement and purchase frequency over time.
These investments have weighed on near-term profitability, with Alibaba China E-commerce Group's adjusted EBITA declining 40% year over year as spending on quick commerce, technology and user experience increased. However, improving fulfillment efficiency, higher average order values and stronger unit economics indicate that these investments are becoming more productive. If Alibaba continues translating higher consumer engagement into stronger merchant spending while improving the profitability of its quick commerce operations, its integrated digital commerce ecosystem could emerge as a meaningful catalyst for fiscal 2027 growth.
How Alibaba Stacks Up Against PDD and JD ?Alibaba faces intense competition from PDD Holdings (PDD - Free Report) and JD.com (JD - Free Report) , both of which continue to invest in strengthening their digital commerce ecosystems.
PDD Holdings has expanded its value-driven marketplace through AI-enabled merchant tools and Temu's international growth, while JD.com leverages its self-operated logistics network and omnichannel retail capabilities to enhance fulfillment speed and customer experience. Unlike PDD Holdings and JD.com, Alibaba operates a broader ecosystem spanning Taobao, Tmall, Taobao Instant Commerce, Ele.me, AliExpress and Alibaba.com, creating multiple consumer touchpoints across domestic and cross-border commerce. As PDD Holdings and JD.com intensify competition, Alibaba's AI-powered ecosystem, merchant monetization initiatives and integrated commerce platform could provide a differentiated long-term growth advantage.
BABA’s Share Price Performance, Valuation & EstimatesBABA shares have plunged 34.8% in the year-to-date period, underperforming the Zacks Internet – Commerce industry and the Zacks Retail-Wholesale sector, which have declined 6.6% and 1.9%, respectively.
BABA’s YTD Price Performance
Image Source: Zacks Investment Research
From a valuation standpoint, BABA stock is currently trading at a trailing 12-month Price/Earnings ratio of 30.23X compared with the industry’s 28.31X. BABA has a Value Score of D.
BABA’s Valuation
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for fiscal 2027 earnings is pegged at $7.29 per share, down by a penny over the past 30 days, indicating a 87.4% year-over-year increase.
Alibaba currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Nike is set to report fiscal fourth-quarter results after the bell Tuesday as the shoe retailer struggles to regain sales growth and turn around its business under CEO Elliott Hill.
The company previously said it expected sales to fall for the rest of the calendar year, while projecting a decline of 2% to 4% in its fiscal fourth quarter. That expectation was well under Wall Street estimates of an increase of 1.9%.
Still, Nike said last week that its results will include an unexpected benefit from tariff refunds that was "not contemplated in the company's previously provided guidance."
Chief Financial Officer Matt Friend said on the earnings call for the fiscal third quarter that Nike expects sales to fall by a low single-digit percentage for the rest of the calendar year, led by growth in North America but offset by a big drop in China. The company's gross profit margin also took a hit last quarter due to higher tariffs in North America.
In its fiscal third quarter, Nike reported steady growth in North America with a 3% sales increase, while its Greater China market saw revenue sink 7% to $1.62 billion for the quarter.
Here's what analysts are expecting from Nike for its fiscal fourth quarter, according to a survey of analysts by LSEG:
Earnings per share: 13 cents expectedRevenue: $10.86 billion expectedFor the full fiscal year, analysts are expecting revenue of $46.27 billion and earnings per share of $1.51. They're also projecting revenue of $46.47 billion for the next fiscal year ending in May 2027.
The earnings come as Hill has been trying to reposition Nike for growth amid slumping sales. The company previously warned its turnaround would not be linear as certain parts of the business improve at different rates.
Hill previously said that the parts of the business that Nike initially focused on turning around are beginning to see "momentum."
The turnaround effort is also placed against a backdrop of macroeconomic uncertainty, with tariffs, the war in the Middle East, soaring gas prices and more. Friend said on the third-quarter earnings call with analysts that Nike could face unexpected impacts from the broader backdrop, including volatility from rising oil prices and lowered consumer confidence.
"We are focused on what we can control," Friend said at the time.
In April, Nike instituted a sweeping round of layoffs, cutting 1,400 roles across the organization in its second workforce reduction of the year.
Last week, the company announced a planned CFO transition, with former Pfizer executive David Denton taking over for Friend effective Aug. 17.
Still, Nike has seen a boom from the World Cup, hosted across North America this summer. While it's not an official sponsor, the company saw its advertisements massively outpace sneaker rival Adidas and gain significant traction across social media.
Nike will host a conference call with analysts at 5 p.m. ET.
While cannabis investors finally have an expedited DEA administrative hearing on the calendar and a fresh Schedule III pathway in motion, Wall Street has stood at this exact intersection before. The pure-play U.S. cannabis proxy, AdvisorShares Pure US Cannabis ETF (NYSEARCA: MSOS), has vaulted 99.2% over the trailing year on rescheduling hope, yet still trades 81.0% below its September 2020 launch price. The pattern of euphoria followed by collapse has been the only consistent feature of this trade.
The Regulatory Pivot The catalyst this time around centers on Section 280E. That single line of the tax code denies cannabis sellers the ordinary business deductions every other operator takes for granted, taxing them on gross profit rather than net income, and pushing effective tax rates above 70% for U.S. multi-state operators. A move from Schedule I to Schedule III would remove that burden. The DEA’s expedited hearing began June 29, 2026, with a conclusion targeted for mid-July and a potential final rule in the Federal Register to follow.
Prediction Markets vs. Historical Rhymes The prediction-market tape tells a different story. The Polymarket contract on rescheduling by today’s close implies a 0.55% probability. The contract for the end of July prints 18.5%. The year-end contract prints 23.3%, having fallen 9.65 cents over the past week. An earlier market resolving on rescheduling by March 31 closed at zero. Traders putting cash behind their convictions are pricing failure.
What’s particularly notable is how cleanly the setup rhymes with prior cycles. The 2018 Canadian legalization rally sent Tilray Brands (NASDAQ: TLRY) above $223 on a split-adjusted basis. SAFE Banking introductions starting in 2019 stalled in the Senate. The 2021 post-election rally faded. The 2024 DEA rescheduling proposal disappeared into administrative limbo. Canopy Growth (NASDAQ: CGC) crested above $241 in mid-2021 and now changes hands at $0.99, a 99.6% drawdown over five years. Tilray has shed 97.5% on the same clock.
The Canadian Disconnect and Punishing Fundamentals Worth flagging is the structural quirk: Tilray and Canopy are Canadian licensed producers and are not themselves subject to 280E. Their share prices, however, have moved in lockstep with U.S. reform sentiment for the better part of a decade. The AdvisorShares ETF is the cleaner proxy because it owns the operators actually paying the punitive tax, with Curaleaf at 12% of net assets as the largest position and TerrAscend at 3% behind it. The fund carried $729.19 million in net assets as of the latest filing, with a defensive 7% cash position held in BlackRock Treasury Trust.
Operator economics underneath the narrative are punishing. Tilray, with its more favorable Canadian tax treatment, posted a fiscal third-quarter net loss of $25.23 million on $206.73 million in revenue. Its trailing 12-month EPS came in at −$0.24. Canopy Growth’s most recent quarter delivered $71.25 million in revenue against a net loss of $154.72 million, with an accumulated deficit of C$11 billion, per the company’s recent 8-K filing. Adjusted EPS missed expectations by 566.67%.
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The 280E Unlock and the Retail Divide For the U.S. operators inside the AdvisorShares fund, 280E relief would be a genuine structural unlock. Cash flows currently consumed by the IRS would land on the income statement, valuations would compress against actual earnings rather than gross profit, and the discount that cash-strapped MSOs face when raising capital would narrow. The math is straightforward. Timing has shredded capital in this sector for eight straight years.
The retail sentiment reflects the familiar split. WallStreetBets posts in early June carried sentiment scores of 90 in connection with the latest MSO uplisting catalyst, with one trader documenting a $2.1 million MSOS position. Yet Tilray’s most recent tracked Reddit post showed a sentiment score of 8 on a thread titled “What’s the buy you regret the most?” Euphoria and exhaustion live in the same forum.
Long term, rescheduling will eventually occur, and U.S. cannabis operators will escape 280E. Markets typically reward structural reform once the rule actually appears in the Federal Register. The historical pattern shows cannabis stocks pricing the arrival multiple times before delivery, with each false dawn leaving the next entry point lower than the one before. Tilray’s $9.66 analyst target is well above the most recent close, and Canopy’s $1.22 target is only marginally above the current price.
The verdict from history is clear: the catalyst exists, the hearing is on the calendar, and the prediction-market tape is pricing failure for a reason.
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Morgan Stanley’s Chief Investment Officer and Chief U.S. Equity Strategist Michael Wilson appeared on CNBC this morning with a framing that should give every AI-chip investor pause. The 2026 semiconductor rally, in his read, looks like the next leg of a commodity rotation set off by Fed money printing, with the AI structural story riding on top. Gold ran. Silver ran. Rare earths and energy ran. Now chips. The cycle, Wilson argues, is closer to peak than to launch.
Wilson’s Setup: A Liquidity Story Behind the AI Rally “We came into 2026, I think people expected the FED to cut rates, ourselves included. The war kind of interrupted that with the oil price spike. But what they have done is they printed a lot of money,” Wilson said.
Data backs the liquidity framing. M2 money supply sits at $23.05 trillion as of May 1, 2026, with consistent month-over-month growth and visible acceleration from December 2025 onward, when the Fed’s asset purchase program kicked off per Wilson’s timeline. Oil told a similar story before fading: WTI peaked at $114.58 on April 7, 2026 and has since cooled to $78.94 as of June 22.
The most striking piece of Wilson’s analog: “We did this chart about a month ago showing how semiconductor index was basically tracking the silver stocks from four months prior. It’s just an interesting analog.”
The Silver Tell That four-month-prior analog matters because silver has already rolled over hard. The iShares Silver Trust (NYSEARCA:SLV) is down 35.42% from March 2, 2026 through June 29, including a 22.9% drop in the last month alone. If chips really are tracking silver on a four-month lag, Wilson’s warning about a summer cooldown has a tape behind it. Investors can review the fund’s structure in the iShares fact sheet.
Beyond silver, rare earth stocks also saw a large run in this commodity rotation. The VanEck Rare Earth and Strategic Metals ETF (NYSE: REMX) is up 144% since May 30th, 2025. That’s very comparable to the run in semiconductor stocks. The VanEck Semiconductor ETF (Nasdaq: SMH) is up 170% across the same timeframe.
NVIDIA: Structural Bull, Cyclical Pause Wilson remains structurally bullish on the AI buildout. “It’s a cyclical industry. Since ChatGPT was announced, we’ve had three cyclical corrections in the semiconductor space. It’s just a correction in a structural bull market for capex. I don’t think capex is going to roll over in a hard way until probably the end of the decade.”
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NVIDIA (NASDAQ:NVDA | NVDA Price Prediction) is exhibit A for the structural side. The company posted Q1 FY2027 revenue of $81.615 billion, up 85.23% year over year, with Data Center revenue of $75.25 billion and a fourth consecutive EPS beat. Filing detail is in the company’s Q1 FY27 press release on the SEC. CEO Jensen Huang called the AI buildout “the largest infrastructure expansion in human history.”
The rate-of-change signal Wilson cites is also visible. Sequential guidance growth slowed from ~14.5% (Q4 to Q1) to ~11.8% (Q1 to Q2), and average EPS beat magnitude has held in a tight 3% to 7% range across four quarters. Big numbers, but the upside surprise is compressing.
NVIDIA shares are down 7.55% over the past month through $194.97 on June 29. Polymarket gives only a 56% probability of NVDA closing above $200 by end of June, and just 54% for end of July, consistent with the consolidation Wilson sees.
Why The Broadening Matters “The rate of change gets to a point where it’s unsustainable. That’s one of the reasons why the market is starting to go sideways. And it’s one reason why semis could take a break here,” Wilson said. He sees the rotation as constructive: “The broadening out in the stock market is a sign of a more healthy economy. Consumer discretionary, the biggest beneficiary of oil prices coming down. Transportation stocks as volume picks up through the economy again.”
The takeaway for AI investors: own the long-duration capex story, but respect the cyclical math. Wilson is long-term bullish on AI infrastructure through the end of the decade and short-term cautious that the silver-to-chips lag may still have something to say this summer.
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Nvidia (NVDA +1.44%) is capping off another successful quarter of trading. The global leader in artificial intelligence (AI) is trading 12% higher heading into the final trading day of the calendar quarter.
But June has been a bust. Nvidia is trading 8% lower in this otherwise resilient month for the markets. Market leadership has shifted from the initial AI leaders to beneficiaries like memory and data storage manufacturers. The upticks there have been driven by demand outstripping supply, resulting in surging prices and thick margins for a historically cyclical industry.
Could this also be an opportunity for existing or potential Nvidia investors? Let's go over some of the reasons why the stock with the largest market cap can bounce back in July.
Image source: Getty Images.
1. Nvidia doesn't lose the headline war forever Don't let June's slide dissuade you. Nvidia stock has continued to be a winner over longer stretches of time. The 5% year-to-date return is trailing the market, but zoom out, and you'll see the stock is up 24% over the past year, more than quadrupling over the three years and almost a 10-bagger over the past five years.
Some of the June headlines are unflattering but potentially misleading:
Other "Magnificent Seven" stocks are starting to sell their own AI chips. Nvidia had a massive $25 billion bond sale this month, its first debt offering in five years. Despite several head fakes over the past year, Chinese restrictions for AI remain painfully in place. Nvidia seems to be fighting upstream in the headwind headline war. It won't always be that way. Remember when Nvidia stock was rattled in early 2025 by reports that China's DeepSeek was achieving major AI advancements on older, less powerful chips? That ultimately didn't slow Nvidia down.
Today's Change
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2. This is still a great growth stock Nvidia doesn't report its financials again until late August. It operates on a different fiscal calendar than many tech titans, which report in the latter half of July.
It's still delivering strong results. Revenue soared 85% in its latest financial report. Margins continue to improve, with adjusted earnings blasting 139% higher.
Nvidia is doing this even amid a sharp reversal in its sales in China, rising competition, and percolating supply chain constraints. The company continues to deliver market-thumping results on a stunning 55.7% adjusted net margin. History is a long game, but Nvidia continues to win the quarterly chapters.
3. The stock is even cheaper than you think Nvidia stock is moving lower in June. Expectations are going the other way. Analysts see Nvidia earning $8.97 per share this fiscal year and $12.76 per share in the new fiscal 2028 year, which starts in late January of next year.
A month ago, those per-share adjusted net income targets stood at $8.95 and $12.66, respectively. Three months ago, those adjusted per-share earnings estimates stood at $8.30 and $11.11, respectively.
As an investor, it's important to recognize moments when market sentiment diverges from fundamentals. If the future is getting cloudy or showing signs of deterioration, that's a fair time to get cautious. But when the outlook is only getting better, that's often a buying opportunity.
How expensive do you think Nvidia is these days? I'll spare you the suspense of overestimating the numbers. Based on Monday's close of $194.97, the world's most valuable company by market cap is trading for less than 22 times this year's earnings. Step up to the new fiscal year that starts in seven months, and Nvidia is fetching just 15 times Wall Street's profit target for that year.
There's no denying that Nvidia's competitors are getting smarter, and that institutional rotation has shifted from the wearer of the AI coat to the coattails. Nvidia is still trading at a discount to many tech players that are growing more slowly and have yet to prove their AI resilience. Don't let the rough June get in the way of Nvidia's potential to heat up this summer.
Key Takeaways NVDA now reports two platforms: Data Center and Edge Computing, aligning with expanding AI markets.ACIE highlights AI factory opportunities across industries and countries beyond traditional cloud providers.Edge Computing adds Gaming, AI PCs, robotics, automotive, AI-RAN and physical AI growth avenues. NVIDIA Corporation's (NVDA - Free Report) new business structure underscores expanding AI growth opportunities, supporting the case for stronger long-term revenue potential. The company has reorganized its reporting into two major platforms — Data Center and Edge Computing — to reflect its current and future growth drivers. Within the Data Center, NVIDIA now separately reports Hyperscale, and AI Clouds, Industrial & Enterprise (ACIE), giving investors greater visibility into fast-growing AI markets beyond traditional cloud providers.
The new reporting framework highlights how NVIDIA's revenue base is becoming increasingly diversified. While hyperscalers remain a major contributor, the company is seeing rising demand from AI cloud providers, enterprise customers, industrial AI deployments and sovereign AI initiatives. Management noted that ACIE captures opportunities in AI factories across industries and countries, reinforcing that future growth will come from a broader range of customers rather than a single market.
Beyond the Data Center, the revamped Edge Computing platform expands NVIDIA's addressable market. It includes Gaming, AI PCs, workstations, robotics, automotive, AI-RAN and other physical AI applications, creating additional growth avenues outside the data center. The company also highlighted strong demand across hyperscalers, model builders, AI cloud providers and enterprise customers, validating its decision to realign the business around these expanding AI ecosystems.
NVIDIA’s recent announcements further validate its new reporting framework. Continued investments in AI factories, agentic AI, robotics and physical AI demonstrate that the company is expanding into several high-growth AI markets. By aligning its reporting structure with these emerging opportunities, NVDA provides investors with greater visibility into future revenue drivers. Supporting this view, the Zacks Consensus Estimate projects fiscal 2027 revenues of $385.4 billion, representing a strong 78.5% increase year over year.
Can Rivals Match NVIDIA's New AI Growth Blueprint?As NVDA reshapes its business around the expansion of AI infrastructure and data centers, Advanced Micro Devices (AMD - Free Report) and Qualcomm (QCOM - Free Report) are evolving their operations to compete for the same long-term growth opportunities.
Advanced Micro Devices is NVIDIA's closest AI infrastructure rival, shifting its business toward Data Center and AI with EPYC CPUs, Instinct GPUs and hyperscaler partnerships. AMD leverages an open ecosystem, expanding AI software and rack-scale platforms to capture cloud demand. However, AMD still trails NVIDIA in CUDA ecosystem strength, AI software maturity and market leadership despite robust AI revenue momentum.
Qualcomm is expanding beyond smartphones by prioritizing edge AI, data-center CPUs, AI accelerators and custom silicon for hyperscalers. QCOM benefits from power-efficient AI, strong CPU expertise and diversified markets spanning automotive and IoT. However, QCOM lacks NVIDIA's scale in AI training infrastructure, software ecosystem and hyperscale deployments, leaving QCOM focused primarily on edge and inference AI.
NVDA’s Share Price Performance, Valuation & EstimatesNVIDIA shares have returned 4.5% in the past six-month period, underperforming the broader Zacks Computer and Technology sector’s 15.7% growth.
NVDA’s Six-Month Price Performance
Image Source: Zacks Investment Research
From a valuation standpoint, NVDA appears overvalued, trading at a forward price-to-sales ratio of 10.69, higher than the industry average of 9.96. The company carries a Value Score of D.
NVDA’s Valuation
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for NVIDIA's fiscal 2027 and 2028 earnings per share is pegged at $8.69 and $11.67, respectively, reflecting robust year-over-year growth of 90.3% in fiscal 2027 and 34.2% in fiscal 2028. Notably, earnings estimates for both fiscal years have moved higher over the past 30 days, indicating improving analyst confidence.
Image Source: Zacks Investment Research
NVIDIA currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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What are the Zacks Style Scores? The Zacks Style Scores, developed alongside the Zacks Rank, are complementary indicators that rate stocks based on three widely-followed investing methodologies; they also help investors pick stocks with the best chances of beating the market over the next 30 days.
Each stock is given an alphabetic rating of A, B, C, D or F based on their value, growth, and momentum qualities. With this system, an A is better than a B, a B is better than a C, and so on, meaning the better the score, the better chance the stock will outperform.
The Style Scores are broken down into four categories:
Value ScoreValue investors love finding good stocks at good prices, especially before the broader market catches on to a stock's true value. Utilizing ratios like P/E, PEG, Price/Sales, Price/Cash Flow, and many other multiples, the Value Style Score identifies the most attractive and most discounted stocks.
Growth ScoreGrowth investors are more concerned with a stock's future prospects, and the overall financial health and strength of a company. Thus, the Growth Style Score analyzes characteristics like projected and historic earnings, sales, and cash flow to find stocks that will see sustainable growth over time.
Momentum ScoreMomentum investors, who live by the saying "the trend is your friend," are most interested in taking advantage of upward or downward trends in a stock's price or earnings outlook. Utilizing one-week price change and the monthly percentage change in earnings estimates, among other factors, the Momentum Style Score can help determine favorable times to buy high-momentum stocks.
VGM ScoreIf you want a combination of all three Style Scores, then the VGM Score will be your friend. It rates each stock on their combined weighted styles, helping you find the companies with the most attractive value, best growth forecast, and most promising momentum. It's also one of the best indicators to use with the Zacks Rank.
How Style Scores Work with the Zacks Rank A proprietary stock-rating model, the Zacks Rank utilizes the power of earnings estimate revisions, or changes to a company's earnings outlook, to help investors create a successful portfolio.
It's highly successful, with #1 (Strong Buy) stocks producing an unmatched +23.94% average annual return since 1988. That's more than double the S&P 500. But because of the large number of stocks we rate, there are over 200 companies with a Strong Buy rank, plus another 600 with a #2 (Buy) rank, on any given day.
This totals more than 800 top-rated stocks, and it can be overwhelming to try and pick the best stocks for you and your portfolio.
That's where the Style Scores come in.
To maximize your returns, you want to buy stocks with the highest probability of success. This means picking stocks with a Zacks Rank #1 or #2 that also have Style Scores of A or B. If you find yourself looking at stocks with a #3 (Hold) rank, make sure they have Scores of A or B as well to ensure as much upside potential as possible.
The direction of a stock's earnings estimate revisions should always be a key factor when choosing which stocks to buy, since the Scores were created to work together with the Zacks Rank.
A stock with a #4 (Sell) or #5 (Strong Sell) rating, for instance, even one with Scores of A and B, will still have a declining earnings forecast, and a greater chance its share price will fall too.
Thus, the more stocks you own with a #1 or #2 Rank and Scores of A or B, the better.
Stock to Watch: Nvidia (NVDA - Free Report) Santa Clara, CA-based NVIDIA Corporation is the worldwide leader in visual computing technologies and the inventor of the graphics processing unit, or GPU. Over the years, the company’s focus has evolved from PC graphics to artificial intelligence (AI) based solutions that now support high-performance computing (HPC), gaming and virtual reality (VR) platforms.
NVDA is a #3 (Hold) on the Zacks Rank, with a VGM Score of A.
Additionally, the company could be a top pick for growth investors. NVDA has a Growth Style Score of A, forecasting year-over-year earnings growth of 88.7% for the current fiscal year.
16 analysts revised their earnings estimate upwards in the last 60 days for fiscal 2027. The Zacks Consensus Estimate has increased $0.94 to $9.00 per share. NVDA boasts an average earnings surprise of +5.5%.
With a solid Zacks Rank and top-tier Growth and VGM Style Scores, NVDA should be on investors' short list.
Nvidia (NASDAQ: NVDA), the undisputed leader in artificial intelligence (AI), currently enjoys a market capitalization of approximately $4.78 trillion.
At the start of the year, the chipmaker was worth $4.63 trillion, meaning Nvidia has added roughly $150 billion to its market cap in the first half of 2026.
The current figure represents a 3.14% gain in the six month period, according to data Finbold retrieved from Companies Market Cap on June 30, when Nvidia shares were trading at $196.48.
NVDA market cap since 1999. Source: Companies Market Cap
Nvidia market cap in 2026 As the same data shows, Nvidia remains the largest company in the world, surpassing Alphabet (NASDAQ: GOOGL) at spot number two, which has a market cap of $4.28 trillion, or $500 billion less than Nvidia. For more context, Nvidia shares are the second most valuable asset globally, surpassed only by gold, which is worth $28.25 trillion at the time of writing.
However, it must be noted that the past month has been quite rought for Nvidia, which is on track to close the quarter on 12% monthly loss. As a result, the company’s current market capitalization, although certainly impressive, is way below its all-time record of approximately $5.72 trillion, reached on May 14, 2026.
With the share prices dropping, management has been making some noteworthy moves to offset the losses. For example, on June 29, Nvidia announced a new partnership with Palantir Technologies (NASDAQ: PLTR) to increase its AI platform and Nemotron model adoption with the U.S. government.
While the deal has already allowed the stock to edge higher nearly 1.5%, near-term volatility is expected to continue, and Nvidia has a long way to go to reach its previous peak. Specifically, to reclaim the $5 trillion mark, the stock would have to rise 4.6%, and to reach a new record above $5.72 trillion, it would have to rally 19.7%.
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Nvidia NVDA stock rose on Tuesday. Shares of Nvidia were up 1.5% at $197.96 in early trading.
Despite the gain, Nvidia has significantly underperformed the broader semiconductor sector.
The stock is up roughly 5% year to date, compared with a 94% gain for the PHLX Semiconductor Index.
The muted performance marks a sharp contrast to Nvidia's dominant run over the past several years and would represent the stock's weakest first-half showing since 2022.
Investor attention is increasingly focused on whether Nvidia's upcoming Vera Rubin platform can restore the company's position as the undisputed leader in AI infrastructure.
The central challenge facing Nvidia is no longer limited to competition from rival graphics processor makers.
While Advanced Micro Devices remains a key competitor, the market has expanded to include custom chip developers and companies focused on central processing units, including Intel.
As artificial intelligence spending accelerates, major technology companies are increasingly distributing infrastructure budgets across a wider range of suppliers rather than concentrating purchases with a single vendor.
The key question for investors is whether Nvidia's next-generation hardware can establish a sufficiently large performance advantage to justify continued dominance in AI deployments.
Nvidia's relative underperformance has become one of the more notable developments in the semiconductor sector this year.
After several years of outsized gains, many investors appear to have taken profits and rotated into other areas of the AI supply chain, including memory chipmakers and emerging AI infrastructure companies.
Intel shares have climbed approximately 250% this year, while Advanced Micro Devices has gained about 152%.
The iShares Semiconductor ETF has advanced roughly 102% over the same period.
The shift suggests investors increasingly believe much of Nvidia's expected growth has already been reflected in the stock price, even as demand for advanced AI hardware remains strong.
Sentiment has also been weighed down by concerns over export restrictions affecting sales to China and broader questions about how long Nvidia can sustain the extraordinary growth rates it has delivered in recent years.
At the same time, Nvidia is expanding its focus beyond traditional AI infrastructure and into robotics and physical AI.
The company is ramping up hiring for its robotics operations in China, advertising more than a dozen positions across Beijing, Shanghai, and Shenzhen, according to a recruitment post published on its official WeChat account.
The openings cover embodied intelligence, simulation, implementation, and solutions.
Nvidia said the robotics team aims to build a "leading robotics platform and ecosystem to help developers and companies create autonomous machines," with the goal of accelerating the deployment of robots from research environments into real-world applications.
The recruitment drive highlights Nvidia's growing emphasis on physical AI, which combines artificial intelligence models with robotics systems that can perceive, reason, and interact with the physical world.
According to the job descriptions, employees will work on technologies including the Project GR00T humanoid robot foundation model, the Cosmos physical simulation world model, and Nvidia's GPU-accelerated computing platforms.
Y’lan Noel and Matthew Law will return for a second season of 'Nemesis' on Netflix.
Photo by Saeed Adyani/Netflix
Netflix announced that its recent hit Nemesis will return for a second season. While the renewal is a win for the streamer's breakout crime drama, it could also be a major victory for Los Angeles if production stays in the City of Angels, providing a meaningful boost to the city's struggling production industry.
The series, which shot its first season exclusively across the city, brought hundreds of production jobs and millions of dollars in economic activity to a region that has seen a sharp decline in film and television projects in recent years.
As more productions leave Hollywood for tax incentives elsewhere, co-creators Courtney A. Kemp and Tani Marole’s commitment to filming the first season in Los Angeles carried added significance, especially as communities continue rebuilding after the Altadena and Palisades fires.
More importantly, Kemp, who also serves as showrunner and executive producer, has made it clear since the show’s debut that Nemesis is intended to be the foundation of something much bigger: a sprawling "television universe" rooted in L.A.
Just before the show’s May 14 premiere, the Power creator said she and Marole knew they wanted to film Nemesis in L.A. “There was no other option,” Kemp said, adding, “The story was always set here, though there was some conversation at one point about shooting it in a different state. Tani and I were both like, ‘Absolutely not. It needs to be here.’ L.A. is a character in the show.”
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She joined her fiancé, Marole, who also serves as executive producer, for a season-one interview to discuss their long-term commitment to telling interconnected stories in L.A. and how she fought to keep a story about this city filmed here. The goal, she said, was to establish the city not just as a backdrop, but as the creative center of Netflix’s next major franchise.
The eight-episode first season told the story of Detective Isaiah Stiles (Matthew Law), who is obsessed with capturing heist mastermind Coltrane Wilder (Y’lan Noel) to the point that it nearly destroys his career and life.
Though the streamer hasn’t shared any creative details about season two yet, including where it will be filmed, the show is rooted in Los Angeles, raising hopes that at least part of the new season will be shot there.
Though plans can change, Kemp previously indicated that a second season of Nemesis would stay rooted in L.A. When asked about the show’s future, she said, “I would love to have a TV universe here in Los Angeles, just like how we kept people working in New York on Power.”
As Kemp explained in that initial interview, keeping production in Los Angeles for season one was both personal and creative. “The men in this world need to come from a city where there are legacy black areas. And we really wanted to write and show those places.”
She added, “We also want Los Angeles to thrive. And there’s such a high level of talent here. Taking production out of L.A. only makes things harder. We really hope that we get to do more seasons of Nemesis and we get to make more shows here.”
Governor Gavin Newsom's April and March 2026 film and TV Tax credit awards are expected to generate nearly $800 million in economic activity across 38 projects. They followed a major July 2025 expansion that more than doubled California's annual film and television tax credit program from $330 million to $750 million while extending eligibility to animated and competition series.
Netflix already films several multi-season series locally, including Nobody Wants This, the final seasons of The Lincoln Lawyer and The Night Agent, and the upcoming comedy A Hundred Percent, which was recently confirmed to be filming in Los Angeles.
Kemp and Marole hoped Nemesis would join that list. Beyond continuing the story after the season-one finale, they see filmmaking as an investment in the city itself.
Of the renewal, Kemp said in a statement, “I feel blessed to get a season two. We thank the fans…it's because of them… there's no other reason. It's them showing up, them talking about it, and their huge social media response. We are grateful to Netflix for recognizing the power of our audience and bringing us back for the fans.”
Marole added, “Season two, we're very grateful to have it. Make no mistake, season two is going to be bigger and better.”
Top Wall Street analysts changed their outlook on these top names. For a complete view of all analyst rating changes, including upgrades, downgrades and initiations, please see our analyst ratings page.
Considering buying MA stock? Here’s what analysts think:
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The global economy is expected to grow 2.4% in 2026, according to [url="]Visa Business and Economic Insights' (VBEI)[/url] 2026 Midyear Global Economic Outlook
As Amazon.com, Inc. (NASDAQ: AMZN) shares are set to close June in the red, Justin Post, an analyst at Bank of America Corp. (NYSE: BAC), has reiterated his bullish outlook on Amazon stock.
Post has maintained his ‘Buy’ rating on Amazon stock, according to a note to clients that Finbold analyzed on June 30. The Wall Street analyst maintained his 12-month price target for AMZN stock at $310.00, implying potential upside of more than 29%.
The reaffirmation comes after Amazon announced a 20% price increase for EC2 (Elastic Compute Cloud) Capacity Blocks for Machine Learning, effective July 1. Post highlighted that this move, following a 15% hike in January, is expected to add 1–2 percentage points to second-half AWS growth and further accelerate the segment’s momentum.
He also pointed to strong tailwinds for AMZN shares, driven by the AI stock boost. Moreover, the AWS and OpenAI partnership brings OpenAI models to Bedrock.
Post highlighted the ramp-up of the $38 billion OpenAI commitment as another key growth driver for AMZN shares. He further noted the early stages of the $100 billion Anthropic commitment on AWS as a major boost for Amazon stock.
Amazon stock price forecast and performance Following Post’s bullish outlook for Amazon stock over the next 12 months, the company’s shares have received a strong buy rating from 45 Wall Street analysts over the past 3 months, as per data from TipRanks. As such, the average Amazon stock price forecast stood at approximately $319.24.
Amazon stock price forecast. Source: TipRanks At the time of reporting, Amazon stock traded at about $239.6, up 5.78% year to date (YTD). With 10.76 billion shares outstanding, the company had a reported market capitalization of around $2.58 trillion.
AMZN YTD chart. Source: Finbold The company’s market cap could grow further over the next 12 months as bullish forecasts from Wall Street analysts could instill investor confidence.
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Key Takeaways Sparky weekly active users rose more than 100% from the prior quarter. Walmart says Sparky users had average order values about 35% higher than non-users. Sparky units rose more than fourfold as e-commerce sales grew 26% globally. Walmart Inc. (WMT - Free Report) continues to use technology to make shopping faster, easier and more personalized, and its AI shopping assistant, Sparky, is becoming a more visible part of that effort. The latest quarter shows that Sparky is gaining user traction while also supporting larger digital baskets.
Weekly active users of Sparky increased more than 100% from the prior quarter. Walmart also improved Sparky’s intelligence and response quality by 40% this year, making the tool more useful across shopping occasions. Customers can now use Sparky in stores, automatically reorder frequently purchased items and interact with it in Spanish.
The more notable signal is order behavior. Customers using Sparky had an average order value about 35% higher than non-Sparky customers. Units purchased through Sparky also rose more than fourfold from the previous quarter. This indicates that shoppers are using the tool for broader purchases, not just one-off searches.
The trend fits within Walmart’s stronger digital performance. Global e-commerce sales grew 26%, while Walmart U.S. delivery rose 45%. More than 36% of U.S. store-fulfilled deliveries were completed in less than three hours, giving Sparky a stronger fulfillment backdrop as customers build orders.
Overall, Sparky is still one piece of Walmart’s broader omnichannel model, but the early data is encouraging. Rising usage, higher order values and stronger unit activity suggest that AI is becoming a more meaningful layer in Walmart’s shopping experience, helping customers create larger and more convenient baskets.
What Do the Latest Metrics Say About Walmart?Walmart, which competes with Costco Wholesale Corporation (COST - Free Report) and Target Corporation (TGT - Free Report) , has seen its shares rally 16.6% over the past year compared with the industry’s 15.3% growth. Shares of Costco have dipped 4.4%, while Target has gained 35.8% in the aforementioned period.
Image Source: Zacks Investment Research
From a valuation standpoint, Walmart's forward 12-month price-to-earnings ratio stands at 38.61, higher than the industry’s 37.62. The company is trading at a premium to Target (with a forward 12-month P/E ratio of 15.62) while trading at a discount to Costco (42.83).
Here at Zacks, we offer our members many different opportunities to take full advantage of the stock market, as well as how to invest in ways that lead to long-term success.
One of our most popular services, Zacks Premium offers daily updates of the Zacks Rank and Zacks Industry Rank; full access to the Zacks #1 Rank List; Equity Research reports; and Premium stock screens like the Earnings ESP filter. All are useful tools to find what stocks to buy, what to sell, and what are today's hottest industries.
It also includes the Focus List, a long-term portfolio of top stocks that have all the elements to beat the market.
Breaking Down the Zacks Focus ListBuilding an investment portfolio from scratch can be difficult, so if you could, wouldn't you take a peek at a curated list of top stocks?
Enter the Zacks Focus List. It's a portfolio made up of 50 stocks that are set to beat the market over the next 12 months; each company selected serves as a foundation for long-term investors looking to create an individual portfolio.
One thing that makes the Focus List even more advantageous is that each pick comes with a full Zacks Analyst Report. This helps explain why each stock was selected and why we believe it's a good pick for the long-term.
The portfolio's past performance only solidifies why investors should consider it as a starting point. For 2020, the Focus List gained 13.85% on an annualized basis compared to the S&P 500's return of 9.38%. Cumulatively, the portfolio has returned 2,519.23% while the S&P returned 854.95%. Returns are for the period of February 1, 1996 to March 31, 2021.
Focus List MethodologyWhen stocks are picked for the Focus List, it reflects our enduring reliance on the power of earnings estimate revisions.
Earnings estimates, or expectations of growth and profitability, come from brokerage analysts who track publicly traded companies; these analysts work together with company management to analyze every aspect that may affect future earnings, like interest rates, the economy, and sector and industry optimism.
Investors also need to look at what a company will earn down the road. This is why earnings estimate revisions are so important.
Stocks that receive upward earnings estimate revisions are more likely to receive even more upward changes in the future. For example, if an analyst raised their estimates last month, they're more likely to do it again this month, and other analysts are likely to do the same.
Harnessing the power of earnings estimate revisions is where the Zacks Rank comes in. The Zacks Rank is a unique, proprietary stock-rating model that utilizes changes to a company's quarterly earnings expectations to help investors build a winning portfolio.
Four primary factors make up the Zacks Rank: Agreement, Magnitude, Upside, and Surprise. Each is given a raw score that's recalculated every night and compiled into the Rank, and with this data, stocks are then classified into five groups, ranging from "Strong Buy" to "Strong Sell."
The Focus List is comprised of stocks hand-picked from a long list of #1 (Strong Buy) or #2 (Buy) ranked companies, meaning that each new addition boasts a bullish earnings consensus among analysts.
It can be very profitable to buy stocks with rising earnings estimates, as stock prices respond to revisions. By adding Focus List stocks, there's a great chance you'll be getting into companies whose future earnings estimates will be raised, which can lead to price momentum.
Focus List Spotlight: JPMorgan Chase & Co. (JPM - Free Report) Headquartered in New York, JPMorgan Chase & Co. is one of the biggest global banks with assets worth $4.90 trillion and total stockholders’ equity worth $364 billion as of March 31, 2026. With operations in more than 60 countries, the company (incorporated under Delaware law in 1968) is one of the largest financial service firms globally.
Since being added to the Focus List on October 10, 2016 at $68.11 per share, shares of JPM have increased 383.61% to $329.39. The stock is currently a #2 (Buy) on the Zacks Rank.
Five analysts revised their earnings estimate higher in the last 60 days for fiscal 2026, while the Zacks Consensus Estimate has increased $0.3 to $22.72. JPM also boasts an average earnings surprise of 7.4%.
Additionally, JPM's earnings are expected to grow 11.7% for the current fiscal year.
Reveal Winning StocksUnlock all of our powerful research, tools and analysis, including the Zacks #1 Rank List, Equity Research Reports, Zacks Earnings ESP Filter, Premium Screener and more, as part of Zacks Premium. You'll quickly identify which stocks to buy, hold and sell, and target today's hottest industries, to help improve the performance of your portfolio. Gain full access now >>
The first half of the year has been eventful for Walt Disney (DIS 1.18%). With its continued growth, a new CEO, and at least one bidding war for a media rival, you might think that shares of the family entertainment giant are doing well. But they're not. Disney stock has declined 13% this year, heading into the final trading day of June.
Can Disney stock get back on track in the second half? Shareholders won't get fresh financials to mull over until early August, but there are still plenty of things to keep an eye on in July. Another big movie hits theaters, and a couple of theme park moves should eventually make its gated attractions more attractive. Let's take a closer look at a couple of dates worth circling on the calendar for the month ahead.
Image source: Disney.
There have been many new experiences for theme park guests at Disney World in recent weeks. Disneyland gets its shot at giving visitors something new later this week, when Soarin' Across America makes its West Coast debut at Disney's California Adventure.
The updated attraction happens in the same Soarin' flight simulator space that takes guests over the World at Disney World and California at Disneyland. The new filmed sequence finds guests gliding over iconic U.S. sites. It will be available for only a limited time, celebrating America's 250th birthday later this week and probably carrying over into next year.
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July 6 Speaking of updated experiences, one of Disney's earliest attractions is getting a makeover. Disney World's Carousel of Progress made its debut at the 1964 World's Fair in New York, years before the Florida resort actually opened. The rotating theater follows an audio-animatronic family through various generations. It closes next week for an overhaul that will reopen at some point in 2027.
The original -- and current -- attraction starts in the early 1900s, takes guests through the 1920s and 1940s, and then jumps to the present. The final scene made sense when the attraction opened at the World's Fair in the 1960s, but now there's an inexplicable 80-year jump between the two final family scenes.
The updated presentation will now start just after the World's Fair in the 1960s. It won't need to catapult over several generations with its updated timeline. The update won't generate the same kind of buzz as the many new Disney World rides and attractions that it will open in the next few years, but the update should draw more guests to the Carousel of Progress.
July 10 It's been a decade since Disney released Moana. The full-length animated feature generated $643 million in global box office sales, a blockbuster by 2016 standards. When Moana 2 arrived at multiplexes two years ago, it topped $1 billion in worldwide ticket sales. It was one of only three movies to cross that mark, and all three have been Disney releases.
Disney is going back to that well a third time next weekend, only this time it's with actual actors. Moana is a live-action adaptation of the original. Dwayne "The Rock" Johnson returns, but most of the other voice actors from the first two films have been recast.
Disney has yet to crack the list of this year's three highest-grossing films, though Toy Story 5 still has time to get there, with just a couple of weeks in the wild so far. Moana has a shot. Disney's live-action adaptations of animated classics haven't all been big hits, but last year's Lilo & Stitch reboot with actual actors did top $1 billion.
Disney has been the studio behind six of the eight movies that have delivered 10-figure global box office receipts since the start of 2024. It will certainly have one later this year, when Avengers Doomsday comes out during the holiday season.
In recent years, Target (TGT 1.90%) has struggled to win over investors, with its larger rival Walmart being the hotter buy. But this year, the tide seems to have turned, with the former rising by around 33% and the latter being up just 2%.
What's behind Target's sudden surge this year, and can this trend continue? Here's a closer look at whether the retail stock is still a good buy right now, or if it may be running out of steam.
Image source: Getty Images.
Target's improving growth rate doesn't tell the whole story A major problem for Target in recent years has been a lack of consistent growth. Unlike Walmart, it relies more heavily on discretionary purchases, so when the economy isn't in great shape, the business isn't likely to do well. That being said, the economy arguably isn't doing all that well now, and yet, Target's growth rate has been rising, as you can see from the chart below.
TGT Revenue (Quarterly YoY Growth) data by YCharts
The recent results may look impressive and have you thinking that new CEO Michael Fiddelke, who took over this year, may have fixed what has been ailing the business. But the reality is that changes in management are unlikely to solve problems this quickly. The reality is that Target has been going up against some particularly soft numbers, so while it has been generating some positive growth, that's also after many periods of declining sales.
In its most recent quarterly results, which went up until May 2, net sales totaled $25.4 billion. While that's up nearly 7% from a year ago, that's barely any improvement from the $25.3 billion in revenue that it reported just three years earlier.
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The stock's valuation may have more to do with its impressive gains this year Target has been a much cheaper stock to own than Walmart, and it hasn't even been close. Even as of now, Target's stock is trading at just 17 times its trailing earnings versus a multiple of 40 for Walmart. Its low valuation may be the big reason for Target being a hotter buy relative to its rival this year, as the delta between the two stocks has been massive, and I believe, unwarranted.
For long-term investors, Target's stock may still be the better option to consider these days. Although its growth rate may not be as impressive in future quarters as it laps its current results, in the long run, as economic conditions improve, it should get back to generating much better numbers. With its value still being fairly modest, it may still be a good stock to add to your portfolio and hold on to for the long haul.
Exxon Mobil maintains a "Buy" rating with a $170 price target, supported by strong profitability and cash flow despite recent oil price declines. Q1 results showed resilient operational execution, with $4.2 billion in GAAP earnings, $8.7 billion in cash flow from operations, and disciplined capex at $6.2 billion. XOM's valuation remains attractive with a low PEG ratio and a 17x P/E multiple, though EPS estimates may normalize as oil prices stabilize.
There is growing expert consensus that car sales in the US will start to decline and may drop sharply. Bain and Company has done some of the best work on this. The consulting firm said US new-car sales could drop to 2 million by 2040, according to CNBC. There are about 16 million a year today.
Cars, SUVs, and light pickups are too expensive. Car Edge reports that the average price of a new vehicle has hit over $50,000. Cox Automotive puts the figure at $51,440 based on MSRP. While it depends on which company’s data is chosen, it is up 4% from last year.
The average monthly payment for a new car is $770. Many loans are for 72 months. This means a car can be worth less than the loan on it after five or six years. The math itself will erode the new car industry.
To some extent, if not largely, due to prices, the average time a car is on the road in the US is 12 years. It is easy to see the challenge for the car companies.
The Ford (NYSE: F | F Price Prediction) F-Series pickup has been the best-selling vehicle in the US for decades. Its base price is $38,780. With a modest number of features added, the price rises to $45,000.
There is another factor worth considering. Inflation is moving up faster than wages. This means that, for the most part, Americans’ purchasing power is declining.
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The average lifetime of an F-150 is 15 to 20 years. That means the truck can run for well over 200,000 miles.
Bain’s other argument is that as immigration drops, the US population growth will be flat. Additionally, only half of US 16-year-olds have a driver’s license. That is down from 70% in 1966 to 1980.
Finally, The Wall Street Journal reports that about one million Americans will drop out of the car market soon. The newspaper quoted Erik Severinson, Volvo’s chief commercial officer. Speaking of car prices, he said, “It’s a proof point of something more fundamental which is wrong in the general economy—that people are not able to buy new cars.”
The price of the F-150 and the headwinds against the whole industry mean that it, and many other vehicles, have started to price their way out of the market.
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I’m thinking old, and probably male? Most likely. Certainly human, that’s the main thing.
Are ZZ Top back on the road? No … Actually, yes! But this isn’t about them.
Who is it about then? Veteran engineers, working for Ford Motor Company in the US.
Oh dear, I think I know how this story goes: hundreds of longstanding workers get laid off because of automation and artificial intelligence … That kinda was how the story was going; the company has 5,000 fewer workers than it did in 2020. Recently, though, there’s been an unexpected twist.
Ooh, I love those, go on. Over the past three years, the company has hired 350 veteran engineers – known as “greybeards” (or “graybeards” if you’re reading this in the US) – made up of former Ford employees and workers from suppliers.
Excellent news! Why, though? I’m guessing it’s not because – despite the threat from the massive acceleration going on in the Chinese automotive industry – Ford has suddenly discovered its charitable side? No. It’s more about doing the things that AI proved to be a bit rubbish at.
AI replaced with human beings, man bites dog! Go on! Not quite replaced. But they discovered that the hundreds of AI-powered cameras they were using, including for design and manufacturing checks, were prone to pitfalls.
Because? To quote Ford’s vice president of vehicle hardware engineering, Charles Poon: “Artificial intelligence is a fantastic tool, but it’s only as good as the information you use to train it.”
Hmm, now who would have that kind of knowhow and experience, I wonder? “Over prior years, we didn’t pay as much attention as we should have to the experience of our most knowledgeable engineers that have been with us through many product cycles,” Poon said.
“Who have been with us through many product cycles”, Mr Poon – they’re people, remember. True. With facial hair to prove it.
So the AI gets chucked on the scrapheap and the “greybeards” come back through the factory gates, singing, like elves … In the fairytale version maybe.
And in the real version? A combination of the two. Ford said that AI is very important to quality gains, “and that, in tandem with deep technical expertise, is what’s needed”.
Yeah, until all that expertise has been successfully transferred to the machines. And the human becomes redundant. Not just from work, but existentially. Argggghhh!
Do say: “Pssst! Yes, you, comrade greybeard. Let’s teach this one wrong, introduce a few glitches, so there may even be a few jobs left for our kids …”
Don’t say: “Wait, who are these cars of the future even for? Our robot overlords?”
Ford says that it rehired hundreds of auto industry veterans after realizing that an overreliance on AI caused some expensive headaches at the company.
The carmaker folded 350 “gray beard” engineers into its workforce over the last three years, including many former Ford workers who were hired to troubleshoot the company’s infamous reliability woes, Bloomberg reports.
Ford COO Kumar Galhotra said that the carmaker “had been relying more and more on automated quality systems,” but AI wasn’t meeting the company’s standards for reliability. With computers not cutting it, Ford “brought back technical specialists [who can] hunt for failure points before a part ever reaches the plant floor,” Galhotra said.
The human workers and their combined years of experience became the centerpiece of Ford’s crusade to make its cars more reliable. “We’re seeing our warranty coverages come down. We’re seeing our recall costs come down,” Ford CEO Jim Farley told Bloomberg, creating a “tailwind” of hundreds of millions of dollars in saved costs.
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“Artificial intelligence is a fantastic tool, but it’s only as good as the information you use to train it,” said Charles Poon, Ford’s vice president of vehicle hardware engineering. “Over prior years, we didn’t pay as much attention as we should have to the experience of our most knowledgeable engineers that have been with us through many product cycles.”
Ford’s reliability reversalInvesting in its human workforce is already paying off. In the new 2026 JD Power Initial Quality Study, which measures a car’s reliability in its first three months, Ford won the top spot for a mainstream brand. It’s a huge reversal from the American automaker’s 10th place spot last year, and Ford even beat out Toyota and Honda—two auto brands synonymous with reliability.
Ford set new records for the most safety recalls in a calendar year in 2025, as problem after problem emerged in its lineup of cars and trucks. From worries about cracked fuel injectors to the threat of its vehicles stalling out on the road, warranty repairs have cost Ford billions in recent years. In 2023 alone, Ford paid $4.8 billion to fix problems with customers’ vehicles—triple the industry average.
The recommendations of Wall Street analysts are often relied on by investors when deciding whether to buy, sell, or hold a stock. Media reports about these brokerage-firm-employed (or sell-side) analysts changing their ratings often affect a stock's price. Do they really matter, though?
Before we discuss the reliability of brokerage recommendations and how to use them to your advantage, let's see what these Wall Street heavyweights think about General Motors (GM - Free Report) .
General Motors currently has an average brokerage recommendation (ABR) of 1.84, on a scale of 1 to 5 (Strong Buy to Strong Sell), calculated based on the actual recommendations (Buy, Hold, Sell, etc.) made by 29 brokerage firms. An ABR of 1.84 approximates between Strong Buy and Buy.
Of the 29 recommendations that derive the current ABR, 17 are Strong Buy and three are Buy. Strong Buy and Buy respectively account for 58.6% and 10.3% of all recommendations.
Brokerage Recommendation Trends for GM
Check price target & stock forecast for General Motors here>>>
The ABR suggests buying General Motors, but making an investment decision solely on the basis of this information might not be a good idea. According to several studies, brokerage recommendations have little to no success guiding investors to choose stocks with the most potential for price appreciation.
Are you wondering why? The vested interest of brokerage firms in a stock they cover often results in a strong positive bias of their analysts in rating it. Our research shows that for every "Strong Sell" recommendation, brokerage firms assign five "Strong Buy" recommendations.
This means that the interests of these institutions are not always aligned with those of retail investors, giving little insight into the direction of a stock's future price movement. It would therefore be best to use this information to validate your own analysis or a tool that has proven to be highly effective at predicting stock price movements.
Zacks Rank, our proprietary stock rating tool with an impressive externally audited track record, categorizes stocks into five groups, ranging from Zacks Rank #1 (Strong Buy) to Zacks Rank #5 (Strong Sell), and is an effective indicator of a stock's price performance in the near future. Therefore, using the ABR to validate the Zacks Rank could be an efficient way of making a profitable investment decision.
ABR Should Not Be Confused With Zacks RankIn spite of the fact that Zacks Rank and ABR both appear on a scale from 1 to 5, they are two completely different measures.
The ABR is calculated solely based on brokerage recommendations and is typically displayed with decimals (example: 1.28). In contrast, the Zacks Rank is a quantitative model allowing investors to harness the power of earnings estimate revisions. It is displayed in whole numbers -- 1 to 5.
It has been and continues to be the case that analysts employed by brokerage firms are overly optimistic with their recommendations. Because of their employers' vested interests, these analysts issue more favorable ratings than their research would support, misguiding investors far more often than helping them.
In contrast, the Zacks Rank is driven by earnings estimate revisions. And near-term stock price movements are strongly correlated with trends in earnings estimate revisions, according to empirical research.
Furthermore, the different grades of the Zacks Rank are applied proportionately across all stocks for which brokerage analysts provide earnings estimates for the current year. In other words, at all times, this tool maintains a balance among the five ranks it assigns.
Another key difference between the ABR and Zacks Rank is freshness. The ABR is not necessarily up-to-date when you look at it. But, since brokerage analysts keep revising their earnings estimates to account for a company's changing business trends, and their actions get reflected in the Zacks Rank quickly enough, it is always timely in indicating future price movements.
Should You Invest in GM?In terms of earnings estimate revisions for General Motors, the Zacks Consensus Estimate for the current year has increased 0% over the past month to $12.85.
Analysts' growing optimism over the company's earnings prospects, as indicated by strong agreement among them in revising EPS estimates higher, could be a legitimate reason for the stock to soar in the near term.
The size of the recent change in the consensus estimate, along with three other factors related to earnings estimates, has resulted in a Zacks Rank #2 (Buy) for General Motors. You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>
Therefore, the Buy-equivalent ABR for General Motors may serve as a useful guide for investors.
Investors interested in stocks from the Automotive - Domestic sector have probably already heard of General Motors (GM) and Federal Signal (FSS). But which of these two stocks presents investors with the better value opportunity right now?
Our PepsiCo (NASDAQ:PEP | PEP Price Prediction) thesis starts with a number: the 24/7 Wall St. price target for Pepsi is $168.86, against a current price of $138.68. That implies 21.76% upside over the next twelve months.
Our recommendation is buy, with a model confidence level of 90%. In plain language, this is a high-conviction call grounded in resilient earnings, an undemanding forward multiple, and a dividend aristocrat profile trading well below its 52-week high.
24/7 Wall St. Price Target Summary Metric Value Current Price $138.68 24/7 Wall St. Price Target $168.86 Upside 21.76% Recommendation BUY Confidence Level 90% A Pullback That Looks Like an Opportunity Pepsi has slipped 2.82% over the past month and is down 1.49% year to date, even as the one-year return sits at a respectable 10%. Shares trade roughly 17% below the 52-week high of $168.19 and just above the 52-week low of $127.42.
The pullback comes despite a clean Q1 FY2026 earnings report: core EPS of $1.61 beat consensus by 4.26%, revenue of $19.443 billion beat by 2.75%, and operating margin expanded 210 basis points to 16.5%.
The international engine is humming. EMEA revenue grew 18%, Latin America Foods 16%, and Asia Pacific Foods 11%, with EMEA core operating profit up 29%.
The Case for $175+ The bull case rests on three pillars. First, the international business is accelerating, with EMEA and LatAm Foods running double-digit growth.
Second, the new $10 billion buyback authorization through February 28, 2030, plus $8.9 billion in total fiscal 2026 shareholder returns, provides a hard floor under EPS.
Third, Pepsi just delivered its 54th consecutive annual dividend increase to $5.92 per share. Polymarket traders assign an 88% probability that Pepsi beats its upcoming quarterly print. Our bull case scenario points to $175.79, a 26.76% total return.
What Could Go Wrong The bear case starts with North America. PFNA grew just 2% in Q1, and the affordability problem at the low-end consumer is real. JPMorgan’s 2026 outlook explicitly flags that traditional value sectors like consumer staples may continue to struggle due to a deteriorating low-end consumer. Core PCE inflation sits at 130.082, near a 12-month high, which constrains further price hikes.
FY2025 operating income fell 19.57% on $1.86 billion of Rockstar and Be & Cheery impairments, a reminder that brand integration can disappoint. Bulls would counter that those were non-cash charges and core EPS still landed at $8.14. Our bear case scenario lands at $152.61, still a 10.04% return.
Pepsi Price Prediction 2026-2030 I am a buyer at $138.68. The 24/7 Wall St. price target of $168.86 reflects a 90% confidence buy, anchored by a 16x forward P/E, a 4.08% dividend yield, and accelerating international growth.
I would step up aggressively if North America volume turns positive next quarter. I would stay on the sidelines if EMEA growth decelerates below 10% or core EPS guidance is cut. With even the bear case projecting double-digit returns, the risk-reward favors buyers.
Year 24/7 Wall St. Price Target 2026 $168.86 2027 $186 2028 $205 2029 $226 2030 $251.13 These projections assume Pepsi continues delivering 5% to 7% core EPS growth and maintains its dividend growth streak. Material upside could come from a faster North America volume recovery; material downside could come from a sharper tariff-driven commodity shock.
Don McGuire, CMO of Qualcomm, spoke to Business Insider during the 2026 Cannes Lions Festival of Creativity, saying that talk of artificial intelligence in the enterprise is at a more realistic place.
"It's about humans and AI together that's really going to make it useful," McGuire said. "Not one or the other."
Don McGuire, CMO of Qualcomm, spoke to Business Insider during the 2026 Cannes Lions Festival of Creativity, saying that talk of artificial intelligence in the enterprise is at a more realistic place.
"It's about humans and AI together that's really going to make it useful," McGuire said. "Not one or the other."
Qualcomm's (QCOM 1.23%) 51% total return over the past five years looks bad if you compare it to Nvidia and Broadcom, which posted five-year returns of 920% and 720%, respectively. That gap is a consequence of Qualcomm's late entry into the artificial intelligence (AI) chip race.
But Qualcomm just shared some news that changes the entire investment thesis for the company, turning it into one of the most compelling AI stocks virtually overnight.
Image source: Getty Images.
What was the big news? Qualcomm issued a news release on June 24 that highlighted its data center strategy. It touted "multiple inflection points" it sees coming over the next three to five years. Management believes it can achieve long-term growth in the agentic AI era, and its aggressive goals reflect that.
It boosted its 2029 guidance target to $40 billion, which is almost two times higher than the previous 2029 target. Qualcomm also told investors that it is aiming for more than $15 billion in AI infrastructure revenue from data centers by fiscal 2029.
The growth is supposed to continue well beyond 2029. The news release went on to detail how data centers, robotics, industrial AI, personal AI, and agentic AI are some of the catalysts that will continue to strengthen Qualcomm's financials beyond fiscal 2029. CEO Cristiano Amon said the company is "in a strong position to capture these opportunities."
The company believes it will have a $1.7 trillion total addressable market by 2030. This market size, plus Grand View Research's projected 30.6% compound annual growth rate for the AI market through 2033, explains why investors are starting to get bullish on Qualcomm stock.
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The entry into AI is already translating into more sales Qualcomm makes most of its money selling chips for smartphones, and the saturated condition of that market has weighed on the stock for years. Revenue dipped by 3% year over year in its fiscal 2026 second quarter, and it has woefully underperformed Nvidia and Broadcom despite the fact that all three companies produce microchips.
However, thanks to its new focus on AI, Qualcomm asserts that its phase of declining revenue and profits is coming to an end. The company has already announced two partnerships to make custom silicon for leading hyperscalers, though it has not named which ones they are. Its AI inference accelerators and application-specific integrated circuits give it the potential to rapidly scale up in the industry.
It will still be a while before these shifts lead to meaningful revenue growth. For the current quarter (fiscal 2026 Q3), management is currently projecting a top line of between $9.2 billion and $10 billion, or $9.6 billion at the midpoint. That implies a 7.4% year-over-year decline from its $10.4 billion top line in the prior-year period. Meanwhile, the company has been rewarding investors with stock buybacks, which reached $5.4 billion in the first half of its fiscal 2026, with another $20 billion authorization recently announced.
The valuation is a steal The way management is talking about its AI initiatives and winning deals with hyperscalers implies revenues will start growing in the near future. Investors shouldn't expect the company to deliver 85% year-over-year growth like Nvidia or a 48% sales increase like Broadcom, but those two companies' track records demonstrate how quickly a chipmaker's trajectory can change.
The stock is trading at values that assume its AI initiatives will not be realized. Its 21.2 price-to-earnings ratio makes it far more favorably priced than Nvidia or Broadcom. It also has a price/earnings-to-growth ratio below 1, which usually indicates that a stock is undervalued.
The stock's rally may not happen right away. It may not even happen this year. However, Qualcomm has tipped off investors that material fundamental improvements will take shape in 2027 and beyond. The valuation doesn't yet reflect that possibility, and those who buy shares today will even get to collect a dividend that at the current price yields 1.8% while waiting for the market to notice.
Intel (INTC +7.14%) stock jumped 4.2% through 11 a.m. ET on Tuesday after Wells Fargo analyst Aaron Rakers raised his price target on rival Advanced Micro Devices (AMD +7.28%) stock to $615 per share this morning.
Rakers didn't specifically mention Intel in the note, but what he did say seems to be getting investors more excited about the stock he didn't mention than the one he did. (AMD shares are up only 3.6%.)
Image source: Intel.
Why Wells Fargo likes chip stocks Once archrivals in semiconductors, both AMD and Intel have been relegated to the role of also-rans in the race for artificial intelligence dominance -- second-stringers just trying to catch up to Nvidia (NVDA +1.44%), which is way out ahead. But Rakers sees potential in AMD as the AI market switches from a preference for GPUs to train large-language models to CPUs that may be more useful for answering AI questions (i.e., "inference").
Most of the AI money remains in GPUs, with Rakers forecasting revenue of $15.6 billion this year, $40.6 billion in 2027, and $63 billion in 2028 for AMD's GPU business, for example. But CPUs are growing fast as well, and Rakers sees CPU revenue growing 68% in 2026, followed by 28% growth in 2027, and 22% more in 2028.
And if he's right about this about AMD, it could mean good things for Intel as well.
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What's next for Intel stock Even if he is right about the big picture, there's still valuation to consider -- and the risk that Intel's success in CPUs is already baked into the stock price.
Consider that at 30 times earnings, Nvidia's not being priced very highly for its dominance, while AMD costs 180 times earnings, and Intel shares fetch more than 900x! At these prices, Nvidia seems the safer bet.
Rich Smith has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Advanced Micro Devices, Intel, and Nvidia. The Motley Fool has a disclosure policy.
