Nvidia (NVDA) has been a market powerhouse, spearheading the tech sector’s growth amid an AI boom. However, there are other players in the sector that Laffer Tengler Investments CEO and chief investment officer Nancy Tengler believes are buying opportunities.
She points to Microsoft (MSFT) as a great buying opportunity despite performing below most of the “Magnificent Seven” names. She explains that the stock is an “opportunity to pick away at a company that we think is going to be an easy winner in AI and is going to benefit from the AI PC upgrade cycle.”
Tengler also believes Amazon (AMZN) is a great investment opportunity, pointing to its cloud computing sector as well as its ad, retail, and streaming businesses as key areas of growth.
For more expert insight and the latest market action, click here to watch this full episode of Catalysts.
This post was written by Melanie Riehl
Video Transcript
Nancy.
This brings me to your commentary about hedge funds piling into NVIDIA in particular, if there’s opportunity to go against the grain of hedge fund movements, where is the opportunity when they’re piling into name like NVIDIA?
That’s driving this market rally.
How do you kind of follow that wave?
But also find areas of opportunity outside of it to gain an edge?
Well, it’s not easy, Madison, but um what we saw from Goldman Sachs was that uh the last week uh uh selling in technology was the worst than it had been in 11 weeks, which is still a very short time period, right?
But um and it was 60% the selling was 60% in software.
And so what we’ve been doing is looking for some of the higher quality names that we own and looking for opportunity to add to those.
And so that was why I suggested in my notes that even though it’s an obvious name, uh Microsoft is interesting to us here because it is underperformed year to date the the most of the names in the mag seven.
And it gives you an opportunity to pick away at a company that we think is going to be an easy winner in A I and is going to benefit from A I PC upgrade cycle.
And Nancy, I believe that you’re also seeing some opportunity within Amazon as well.
So I I, is that a similar investment point?
Is it all about A I?
Is it all about the growth there or what is it about Amazon?
Maybe that you also find attractive at these levels?
Yeah, so Sean, both those names are hyper scale or cloud computers.
And so uh cloud computing story, sorry.
And, and so what we saw last quarter was that Amazon, the big, the big gorilla was up about 17% last quarter year, over year in terms of cloud computing and Microsoft’s Azure was up 31%.
So when there’s all this debate going back and forth about whether or not uh who’s going to benefit from A I, we think that both of these names will, will be winners.
And so you want, you want to be positioned in both plus the other aspects of Amazon uh ad growth, uh the retail side of the business and uh Amazon prime uh video, we think it will continue to be uh drivers of growth.
Andy Jassy is really, you know, when he stepped in, he got what we call Tim cooked.
Uh There was, you know, a lot of doubt about whether or not he could run the company as there was with Tim cook at Apple when he took over.
Um This is what happens when you follow an iconic CEO.
But in general, um we think he’s done an excellent job and the company is poised for growth.
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