I am placing a huge bet on these three stocks, FB, INTC, and BABA as I believe they will yield significant returns over the next 5 years and destroy whatever the market does.
I'm going to give a very brief overview:
FB: HUGE overreaction from earnings, they will continue to grow at a steady pace as they continue to monetize and grow their platforms while also capitalizing on the emergence of the metaverse. I expect them to hit and exceed the high range of their growth expectation 11%+. Even if FB is not able to execute to perfection their ridiculously low multiples paired with huge moat for their business model makes them an enticing long term buy. I believe this has the best risk/reward ratio compared to the others. Five years from now: Bear Case: $310. Base case: $420 Bull Case: $515
INTC: INTC is somewhat of a similar story, I believe it actually has slightly more risk than FB as their high capital expenditures putting short term margin stress on their business don't pay off properly it will severely harm them but that is unlikely. Intel is doing a phenomenal job investing in themselves as they will start to take the lead in manufacturing, CPU's, and quite possibly GPU's if they execute to perfection. Their excessive amounts of R&D will allow them to regain market share from AMD in many different segments but most importantly the data center segment and with their heavy investments into manufacturing they may be able to take the lead or properly compete with TSMC and Samsung which would be substantial. They are also beginning to produce GPU's that will help fill the GPU shortage in the short term and if they execute to perfection they may dominate that market. Essentially, if Intel is able to execute their plans somewhat efficiently they will begin to grow 10-12% starting 2024-2025 and with them trading at a P/E of 9 they will do extremely well. One common argument is that people don't want to wait until 2025 for Intel to start growing and that theres no point in investing now but it's important to remember that the stock market moves in the future, it won't wait until INTC starts putting up these numbers but when it appears so. Five years from now: Bear Case: $60. Base Case: $85 Bull case: $102
BABA: I've written about BABA before and this may be the most hated but this has the most upside potential but does carry some significant risks. I'm not even going to bother going through their business, which dominates in e-commerce, cloud, and numerous other consumer segments that are essentially concerned. Everyone knows that BABA has great financials but people are simply scared to invest because of China. I think this is a classic overreaction from the market as China will begin to ease regulations on their companies as they view GDP growth and employment to be vital going into the future and as long as BABA complies with the reasonable policies they will do fine. It's simply a matter of being patient, waiting for these short term headwinds to clear, and it will yield great returns. They are reporting earnings tomorrow and I honestly don't know what the fuck will happen but to be honest I don't give a fuck what happens, they are great for the long term but facing some significant short term headwinds. Now, the reason this is the riskiest is if A) the CCP doesn't calm the fuck down and continues to destroy BABA or B) China invades Taiwan which would not only destroy BABA but the rest of the market. Overall, five years from now Bear Case: $200. Base Case: $390 Bull Case: $510
What are some companies you guys have extremely high conviction on? Essentially, what are your core positions? (No VOO, SPY, VTI)
I own a lot of stocks but these are 3/5 core positions and I think they will dominate going into the future. Thinking about the short term, I could see BABA and FB getting hit even more but INTC will probably recover soon. Also,
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