Consider UnitedHealth (UNH) as an undervalued defensive stock with a potential price target of $450, representing a 50% upside. For investors bullish on Hims & Hers (HIMS) after its recent drop, selling a $40 put option could be an attractive way to capitalize on high volatility. Keep an eye on Robinhood (HOOD) ahead of its crypto event on June 30th, which is viewed as a key upcoming catalyst. Despite near-term headwinds, Tesla (TSLA) is seen as a long-term AI investment, with conviction building around its Robotaxi and Optimus robot initiatives. The overall market appears poised for new all-time highs, supported by falling oil prices and the increasing possibility of a Federal Reserve rate cut in July.

Tesla (TSLA)

• The stock experienced a 9% to 10% increase in a single day, driven by excitement around the public reveal of its Robotaxi service.
• The speaker views the Robotaxi and the Optimus humanoid robot as the next major growth drivers (the "S curve") for Tesla. The market appears to be pricing in this future potential, looking past near-term challenges.
• Influencers who were invited to test the Robotaxi in Austin, TX reported an "incredible experience" and a simple user interface, generating significant positive buzz.
• The speaker, a self-proclaimed former skeptic of Full Self-Driving (FSD), is now a major believer. He pays $99/month for the service and states he would cancel his Netflix subscription before canceling FSD, highlighting its value in providing productivity and mental clarity while driving.
• Bull Case: The core investment thesis is that Tesla will dominate the autonomous vehicle market.
  • Scale: If Elon Musk's projection of hundreds of thousands of Robotaxis by 2026 is even partially correct, Tesla could create a massive network of millions of vehicles that can be activated with a software update.
  • Competitive Edge: The speaker believes Tesla's vision-based system (neural nets) and massive data fleet give it an advantage over competitors like Waymo, which uses LiDAR. He also described his experience in a Waymo as having a "horrible price, horrible experience."
  • Winner-Takes-Most: If Tesla can offer the cheapest cost-per-mile and the best user experience, it could "run away with this market."
• Risks Mentioned:
  • Profitability: Robotaxis and Optimus are still "far away" from contributing meaningfully to Tesla's net income.
  • Near-Term Performance: The speaker expects "crappy earnings" and "horrible" delivery numbers in the near future.
  • Valuation: The stock is described as "aggressively valued" based on its current earnings multiple.

Takeaways

• The market is currently focused on Tesla's long-term artificial intelligence (AI) story (Robotaxis, Optimus) rather than its short-term car sales and earnings.
• For long-term investors, the narrative suggests that betting on Tesla is betting on Elon Musk's ability to execute on these world-changing AI products.
• Despite the high valuation and expected poor near-term results, the speaker is personally looking for an opportunity to "aggressively get in" and make Tesla a top three position in his portfolio, viewing it as a clear long-term winner.

Hims & Hers Health, Inc. (HIMS)

• The stock took a severe hit, falling 35% in one day.
• The primary cause was the announcement that Novo Nordisk is canceling its partnership with HIMS. This partnership was seen as a key growth driver, particularly for weight-loss treatments.
• Bank of America reaffirmed a $28 price target, forecasting that HIMS's growth will slow to the mid-teens by the second half of 2025, citing the loss of the Novo partnership and skepticism about organic growth.
• The HIMS CEO stated they refused to be "strong-armed" by Novo Nordisk into compromising clinical standards for patients.
• The speaker holds a position in HIMS with an average cost of $55 (the stock is now at $43) and is not selling.

Takeaways

• This is a classic "thesis-breaking" news event. Investors must decide if the loss of the Novo Nordisk partnership fundamentally ruins the long-term growth story for HIMS.
• The speaker views the company as fundamentally "cheap" even before the drop and believes it can recover. He compares the situation to temporary, headline-driven drops in other major stocks like Tesla and NVIDIA.
• For current or potential investors, there are three main paths:
  1. Buy the Dip: If you believe in the long-term "Netflix of health" thesis and think the market overreacted, this could be a buying opportunity.
  2. Sell Puts: For those who are bullish but want a less direct way to play it, selling put options could be attractive. The high volatility has inflated option premiums. The speaker gave an example of selling a $40 put option, which could generate a 5% return on the required collateral if the stock stays above $40.
  3. Sell/Avoid: If you believe the loss of the partnership is critical to future growth, the advice is to cut your losses and move on.

UnitedHealth Group (UNH)

• The speaker announced a new trade in UNH, viewing it as a "deep value play."
• The stock is down 40% year-to-date and trades at a low valuation of 11 times forward earnings.
• Bull Case:
  • Insider Buying: Both company insiders and members of Congress have reportedly been buying the stock.
  • Valuation: Based on a projection of $45 earnings per share (EPS) by 2030 and a conservative 10x price-to-earnings (P/E) ratio (well below its historical average of 22x), the speaker sees a potential price target of $450. This represents 50% upside from the current price of around $300.
  • Defensive Play: As a healthcare company, UNH is considered a defensive stock. If a recession occurs, investors may rotate from high-growth stocks into undervalued defensive names like UNH.
• Risk Mentioned: The speaker acknowledges there is a "narrative issue" with the company that he is not fully educated on, and that it could potentially be a "value trap."

Takeaways

• UNH is presented as an undervalued, defensive stock with significant upside potential if it can overcome its current negative sentiment.
• The speaker's strategy is a long-term options play called a call debit spread.
  • Trade: He bought the December 2027 $420 call and sold the December 2027 $460 call.
  • Goal: This trade is profitable if UNH rises above his breakeven point and reaches maximum profit if the stock is at or above $460 by the expiration date in 2.5 years.
  • Potential Return: This specific structure offers a potential 5x return on the capital invested. This is a bullish strategy for investors who believe in a significant recovery over the next couple of years.

Robinhood (HOOD)

• The speaker is "super bullish" on Robinhood, citing several positive developments.
• Cathie Wood's ARK Invest is actively buying the stock, recently adding 319,000 shares.
• New Product - Mortgages: Robinhood is now offering mortgage rate referrals.
  • This diversifies revenue and makes the platform "stickier" by integrating into a major life event for its core demographic (20s and 30s).
  • To access the discounted rates, users must be Gold subscribers, which drives recurring revenue and deeper engagement with the platform.
• Upcoming Catalyst: Robinhood has a crypto event on June 30th, which is expected to be a positive driver for the stock.

Takeaways

• Robinhood is evolving from a simple trading app into a diversified financial services platform.
• The new mortgage referral service is a key example of this evolution, creating new revenue streams and increasing customer loyalty.
• Investors should watch the upcoming crypto event on June 30th for potential announcements that could further boost the company's growth prospects.

General Market & Economic Outlook

• Geopolitical De-escalation: The perceived end to the conflict between Iran and Israel, announced by former President Trump, was seen as a major positive for the markets. This removed a significant risk factor.
• Oil Prices: As a result of the de-escalation, oil prices fell 8% to $68/barrel, with the potential to go below $65. Lower oil prices are a positive factor for taming inflation.
• Federal Reserve Policy: Recent comments from Fed presidents Goolsby and Bowman have increased the possibility of an interest rate cut as soon as July.
• Market Outlook: The combination of geopolitical relief, falling oil prices, and the potential for earlier-than-expected Fed rate cuts creates a bullish environment for stocks. The speaker believes the S&P 500, which is only 2-3% off its peak, has a clear path to all-time highs, especially if Q2 earnings are strong.