Consider a bullish position in Amazon (AMZN), as its AWS cloud division is poised to re-accelerate growth driven by its partnership with AI company Anthropic. Microsoft (MSFT) is another high-conviction investment due to its finalized 27% stake in OpenAI, which is expected to guarantee significant spending on its Azure platform. A more speculative trade involves NVIDIA (NVDA), betting on the massive, unpriced catalyst of the U.S. government potentially allowing it to resume chip sales to China. For a "picks and shovels" play on the AI Data Center Infrastructure theme, look at Bloom Energy (BE), which is positioned as a key energy provider for power-hungry data centers. Finally, surging app usage data for Instagram and Facebook suggests Meta Platforms (META) could be a strong speculative long trade heading into its earnings report.

Amazon (AMZN)

• The hosts presented a strong bullish thesis for Amazon heading into its earnings report.
• The primary catalyst is the potential for AWS (Amazon Web Services) to re-accelerate its growth.
  • Satellite imagery suggests that several new, massive data centers are close to coming online.
  • This new capacity is expected to serve a huge deal with the AI company Anthropic, in which Amazon has invested billions.
  • The hosts believe Amazon is a key way for public market investors to get exposure to Anthropic's rapid growth, as Anthropic is reportedly gaining significant market share in the AI API business.
• Amazon's custom Trillium chips, while less powerful than NVIDIA's, are optimized for Anthropic's models and have a competitive total cost of ownership within Amazon's infrastructure.
• Independent data (credit card swipes) suggests Amazon's e-commerce business is also likely to beat market expectations.
• Risk Factor: The recent widespread layoffs could be interpreted as a negative sign about the company's health, creating uncertainty. However, the hosts believe it's more likely a strategic reallocation of capital towards high-growth AI infrastructure.

Takeaways

• The investment thesis for Amazon centers on the belief that its cloud division, AWS, is about to turn a corner and show renewed growth, driven by the AI boom and its partnership with Anthropic.
• Expectations for the stock are somewhat muted due to concerns over layoffs, which could create a favorable "risk/reward" setup if the company reports strong results and guidance.
• One host revealed that Amazon is his highest-conviction trade of the week, with a large, leveraged options position.

Microsoft (MSFT)

• The sentiment for Microsoft is overwhelmingly bullish, primarily due to its strategic investment and partnership with OpenAI.
• Microsoft recently finalized a deal giving it a 27% stake in OpenAI, which is seen as a massive victory.
• The deal provides certainty for Microsoft's future, as it guarantees significant spending from OpenAI on Microsoft's Azure cloud platform.
• The hosts expect the upcoming earnings call to be a "celebration" of this deal, with management likely to provide very positive commentary on future growth and spending.
• Risk Factor: The hosts did not identify any significant risks, stating they "cannot see anything in the Microsoft story right now that's a risk factor." They believe any selling on the news is from short-term traders.

Takeaways

• Microsoft is viewed as the primary and most direct way for public investors to gain exposure to the success of OpenAI.
• The finalization of the OpenAI deal is a major positive catalyst that is expected to dominate the company's earnings report and forward-looking statements.
• A host is holding a long-term position and has a leveraged options position into earnings, ranking it as his second-highest conviction play.

Google (GOOGL)

• The hosts are bullish on Google, though with some underlying concerns about its core business.
• The main positive drivers are its diversified AI strategy:
  • Google is a major beneficiary of the overall AI compute build-out.
  • It owns a 14-15% stake in Anthropic, making it another way to invest in the growing AI model.
  • It has numerous other investments in AI, robotics, and health tech.
• Risk Factor: The primary concern is a lack of transparency in its Search business. The hosts suspect that a decline in traditional organic search is being hidden by a rise in AI-generated queries, which may not be as valuable to advertisers.
  • However, they believe it's unlikely this issue will be exposed in the upcoming earnings report and that, on paper, the search numbers will continue to look strong for now.

Takeaways

• Google is considered a strong, diversified AI play with multiple avenues for growth beyond its search engine.
• While there are long-term questions about the impact of AI on its core advertising business, these are not expected to be an issue in the short term.
• A host is long and has a leveraged options position in Google, ranking it third in conviction behind Amazon and Microsoft.

NVIDIA (NVDA)

• The sentiment is bullish, based on a specific, high-impact potential catalyst.
• The primary thesis is the possibility that the U.S. government will ease restrictions and allow NVIDIA to resume selling its advanced chips to China.
• This is viewed as a "massive" catalyst that is not currently priced into the stock. The hosts noted that while NVIDIA is great without China, it would be unimaginably great with China.
• Recent remarks from the President's administration about talks with China are seen as a positive signal.
• Risk Factor: The entire trade is dependent on a political decision. If the talks with China lead to nothing, this catalyst will not materialize.

Takeaways

• Investing in NVIDIA right now is seen as a bet on a favorable outcome in U.S.-China trade relations regarding semiconductor chips.
• If NVIDIA is allowed to sell its chips to China again, the stock could have significant room to run, even from its current high valuation.
• A host has a "reasonably large" leveraged options position in NVIDIA specifically to play this potential catalyst.

Investment Theme: AI Data Center Infrastructure

This was a major theme discussed as a "picks and shovels" way to invest in the AI boom.

• Bloom Energy (BE)

  • Described as possibly the #1 energy beneficiary of AI. Data centers have massive power needs, and Bloom's technology offers the "fastest road to energy" for them.
  • Newer NVIDIA chips require significantly more energy, which Bloom is uniquely positioned to deliver, further strengthening its market position.
  • A host has a very large position in BE, which has been one of his best-performing stocks.
  • Note: The stock is up 1200% in the past year, which raises questions about its valuation and future upside.

• Caterpillar (CAT)

  • Mentioned as a great "off-radar" play on the AI data center build-out.
  • Caterpillar provides the heavy machinery required for the physical construction of the massive data centers being built globally.
  • The stock was up 12% on the day of the podcast, driven by this demand.

• TransAlta (TAC)

  • A Canadian energy company based in Alberta.
  • The investment thesis is simple: the world needs more data centers, Canada (specifically Alberta) has the excess energy to power them, and TAC is one of the key local energy companies that will benefit when data center deals are inevitably signed there.
  • A host is holding his position and has been adding to it, willing to wait for the thesis to play out.

Takeaways

• Beyond the big tech companies, there are significant opportunities in the companies that provide the essential infrastructure for AI.
• This includes companies that supply energy (BE, TAC) and those that provide the heavy equipment for construction (CAT). These are considered "picks and shovels" plays on the AI gold rush.

Meta Platforms (META)

• The hosts initially had no opinion on Meta.
• During the show, a host pulled up live app intelligence data that showed Instagram and Facebook usage was surging to new highs in recent weeks.
• This new data point immediately changed the host's perspective, making him consider a speculative long position into earnings.
• Risk Factor: The discussion was brief and did not cover risks in detail.

Takeaways

• Recent app engagement data for Instagram and Facebook looks very strong, which could be a leading indicator for a positive earnings report.
• Based on this live data analysis, Meta shifted from a "stay away" to a potential speculative trade for the hosts.

Apple (AAPL)

• The sentiment was neutral to slightly bearish for the short term.
• The hosts described Apple as "less exciting" compared to its big tech peers that have clear AI narratives.
• The discussion focused on the idea that Apple's growth is primarily tied to iPhone sales and a slow, predictable increase in services revenue.
• Apple's AI efforts are perceived as lagging behind competitors, with the major update to Siri being delayed.
• Risk Factor: A lack of a compelling AI story could cause Apple to underperform its peers as capital continues to flow toward AI leaders.

Takeaways

• Apple is viewed as a safe, long-term hold but is not considered an exciting trade for earnings.
• The hosts are not taking any leveraged positions in Apple, preferring to allocate capital to companies with stronger, more immediate AI-related catalysts.

Other Stocks Mentioned

• Dutch Bros (BROS)

  • A speculative bullish idea based on strong app usage data, which has historically correlated with sales.
  • The hosts also noted it could benefit from negative consumer sentiment surrounding Starbucks.
  • A host is considering taking a speculative long position for its earnings next week.

• Aritzia (ATZ.TO)

  • The company recently launched its first-ever mobile app, which shot to #3 in the world on the app store charts.
  • This is seen as a "massive positive signal" for the brand and future growth.
  • However, the hosts noted the stock is "already flying," so they are not chasing it as a trade.