Stocks I Am Watching This Month

ASML: DOUBLE BEAT & RECURRING VIBES

The past week, ASML reported impressive Q3 results with strong bookings — proving once again why it’s indispensable for the next generation of chips
What often goes unnoticed, though, is the continuous growth of its services segment, which provides recurring and stable revenue streams
As the installed base grows, so do revenues from maintenance, spare parts, field upgrades, and uptime contracts
Every six months, we see an increase in the average selling price of its EUV machines — a clear sign of remarkable pricing power
On top of that, management is delivering a masterclass in capital allocation, having ramped up share buybacks precisely when the stock was trading at overly depressed levels
For perspective, the stock is up +53% in the past six months.

**IS VISA BACK IN THE BUY ZONE? **

Visa’s stock has corrected about -10% from its June highs
So far this year, it’s up +6.13% YTD, while the S&P 500 is running at +13.5%.
Could one of the world’s highest-quality companies be offering a new entry opportunity?
Visa is a cash-generating machine
Every year, it brings in billions in free cash flow — which it returns to investors through buybacks and steady dividends
It’s a business that grows consistently, has massive profit margins, operates in an oligopoly, and has a truly global presence
Currently, the stock trades at a P/E of ~32x and P/FCF of ~29x — both below their multi-year averages (34x and 31x respectively)
In other words, the “premium” built into the stock’s price has eased.

WHY I INVEST IN GOOGLE

It owns 14% of Anthropic
It owns 8% of SpaceX
It runs Gemini
It powers Claude with TPU chips
It covers 90% of all online searches
It owns YouTube, Maps, and Android
It runs Waymo
It manages over 3 billion Google-powered devices
Advertising, email, cloud, browser
Wherever you go online… Google is already there
And that is the real moat
It’s not just a tech company —
GOOGLE IS THE INTERNET.

**IS AI TAKING OUR JOBS? **

Over the past 3 years, META has increased total revenue by 50%, while its total workforce has decreased by -9%
Looks like Zuck kept his promise when he called 2023 “the year of efficiency”
The recovery in operating margins since late 2022 has been truly impressive
META, like most of the MAG 7, is investing aggressively in AI development
And it’s doing so with cash it already has, thanks to the massive inflows pouring into its balance sheet
This could very well allow it to reduce its workforce even further as AI automates more and more functions
How does META look to you from an investment point of view?

Posted Using INLEO