Prices for memory chips are forecast to soar in 2026. but what just as bad/even worse it looks like chip customers are looking at serious supply shortages during the year.
Higher prices and supply shortages could be enough to put earnings at risk at some high multiple cloud and AI companies.
I already own Equinor in my Dividend and Jubak Picks portfolios. Today, January 16, I’m adding the shares to both my Volatility Portfolio.
If the United States (and other technology economies such as Japan and Europe) are serious about reducing China’s dominance in the crucial minerals called rare earths (and I believe they are), then you need to realize as an investor that in the next five years all roads to that goal lead through Lynas Rare Earths (LYSDY) and MP Materials (MP). Both stocks are up hugely in 2025, but I think you need to own them. Buy half a position now and add on any dip, or dollar cost average over the next 12 months (with a bigger monthly buy on any dip) but own them. I have owned Lynas in my Jubak Picks Portfolio since October 18, 2022. The position is up 88% in that period as of the close on December 8. The ADR is up 78% in 2025 to date. On a dip I will add it to the long-term 50 Stocks Portfolio. MP Materials is up 298% in 2025 through December 8. Tomorrow, December 9, I will add MP Materials to my Volatility Portfolio. On a dip I will add it to the Jubak Picks Portfolio.
While Nvidia (NVDA) gave back some of its post-earnings pop from yesterday–falling 3.15% in trading today, November 20–Walmart delivered its own blowout report today and held its post-earnings report gains with shares closing up 6.46% at the close.What was there NOT to like.
No slowdown on plans for AI capital spending in earnings results this past week from Big Tech. Alphabet/Google (GOOG) said it was increasing what it planned to spend on A.I. data center projects this year by $6 billion, after spending nearly $64 billion over the past nine months. Microsoft (MSFT) said it had spent $35 billion in its latest quarter, $5 billion more than it had told investors to expect just a few months ago.
Amazon (AMZN) said it would be “very aggressive” in adding more data centers and would spend $125 billion this year-— and even more next year. Meta Platforms (META) raised its spending forecast to at least $70 billion by the end of the year, which would be nearly double what it spent last year. The stock market reaction wasn’t unalloyed joy. Investors seemed generally positive on spending plans from Alphabet, Microsoft, and Amazon. And skeptical of Meta’s strategy and spending.
Third, the intense competition to lock up sources of decently priced and reliable electricity: Pick #6: Cameco
Pick #5 for the energy crisis is Generac
Think about the state of the electricity grid in the United States and pretty much everywhere in the world over the next decade.The grid will be stressed by the huge growth in demand from AI infrastructure. Its antiquated technology will be increasingly exposed to view–and an increasing threat to the grid managers’ ability to deliver uninterrupted electricity. And it will increasingly threaten to devolve into a patchwork of only marginally compatible technologies for energy production from gas turbine, legacy coal-fired power plants, solar farms, utility-scale battery storage, and wind turbines. It’s no wonder that demand for core technologies like electrical transformers has soared, resulting in huge backorders and extensive delivery delays.The transformer sector is relatively concentrated with five manufacturers owning 40% of a $27 billion market projected to grow at a compounded annual rate of 6% to 7% through 2033. Of those dominant players my pick is Siemens Energy (ADR: SMNEY), the 2020 spin off from Siemens (SIEGY) in 2020. It’s not the biggest player in the sector–coming in at No. 2 behind GE Vernova (GEV). (Look for GEV as a pick in Part 3 OF THIS special Report.) But I like its mix of businesses slightly better in the timeframe of this aspect of the energy crisis. and I really like the company’s ability to pick up market share over the last five years.
Call this bookkeeping to make sure everYone is on the same page.Yesterday and today I made two picks for me Special Report on the 3 energy crises for the NOW stage in this crisis: BEPC and LNG. Here’s what I wrote:
You don’t need the Department of Energy or the Energy Information Administration to tell you we have an energy crisis. (Good thing since they’re shut down with the rest of the Federal government today.) All you need to do is look at your electricity bill. This summer monthly home electric bills jumped in Trenton, New Jersey, for a typical home by $26. In Philadelphia, it increased about $17. And in Columbus, Ohio, it spiked $27. And your monthly bill doesn’t capture the full damage. In California,residential electric rates are up 62% in five years. In Maryland residential rates are up 54% in five years. Most frustratingly–and most importantly for investors–those bills don’t explain the nature of the crisis.
Or more accurately “crises.” Because we’re the middle of three, overlapping and interlocking energy crises. That are playing out on different timeframes that range from NOW to the next 5 to 10 years. It’s that last point that’s critically important for investors. Because to make money–and let’s be clear: like in all crises there’s money to be made investing in these three crises–you’ve got to understand the nature of each crisis and buy into it at the right time. Not so early that you sell in disappointment because your profits haven’t arrived yet. Not so late that all themes tasty profits are gone. This Special Report is about untangling the 3 energy crises, giving you a timeline for investing in each, and then calling out 10 picks you cause to profit from theses crises. Ya, ready?
U.S. silver futures popped above $40 per ounce, surging alongside gold to new record highs. The precious metals are rallying ahead of an expected September 17 cut to interest rates and continued worry about Trump Administration efforts to bring the Federal Reserve to heel.
The front-month NYMEX September silver contract rose 2.2% to $41.10 an ounce, the highest since September 2011. Silver was up 10% in August for an eighth straight monthly increase.
Microsoft (MSFT) ended its fiscal year beating the top- and bottom-line estimates. For the fourth quarter that ended in June revenues came in at $76.4 billion, up 18.1% year over year and beating analyst estimates by $2.57 billion. Diluted EPS of $3.65 was up 23.7% year over year and beat analyst estimates by $0.27 a share. Operating margins came in strong at 44.9%, which represents an expansion of 180 basis points. The company also raised guidance. For Fiscal Year 2026 the company expects another year where revenues and operating income grow in the double-digits. Management projected Fiscal Year 2026 capital expenditures to moderate compared to fiscal 2025. Operating margins are expected to be flat year over year. But what’s especially impressive about the quarter to me is the balance between current growth and growth in the units that represent the company’s future.
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