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the best way to find great stocks before
00:00:02
everyone else is to understand a
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company's products not just their
00:00:06
profits huge growth happens when there's
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a new or quickly growing market and an
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existing company already has the perfect
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product for it Nvidia is making
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millionaires as their gpus keep
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dominating AI processing in data centers
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not just gaming and paler is making
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people rich as their AI software
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platforms gain new ground in commercial
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Industries not just with governments and
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in this episode episod I'll highlight
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three stocks that are dominating
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different markets that are all growing
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fast thanks to AI your time is valuable
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so let's get right into it first things
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first I'm not here to waste your time
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here's everything I'm going to talk
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about in this episode super micro
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computer which is a great data center
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technology company that works with
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almost every major chipmaker and cloud
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service provider AMD and their Mi 300X
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platform which is the only real
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competitor to nvidia's gpus and Netflix
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which could be one of the biggest
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beneficiaries of generative AI for video
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because they already use AI in some very
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sneaky ways which I'll show you in a few
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minutes and speaking of AI nvidia's GTC
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goes from March 18th to the 21st and all
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be in Silicon Valley to cover it live
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GTC is nvidia's massive developer
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conference where they showcase the
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latest AI breakthroughs in every Major
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Market from video games and visual
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effects to Robotics and self-driving
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cars the same science behind the stocks
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that I talk about on this channel and
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this year's GTC focuses on how
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generative AI is taking every industry
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by storm so comment below with what you
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want me to cover while I'm sneaking
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around like asking questions at Jensen's
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keynote or trying to get my hands on
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nvidia's newest products and prototypes
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and there will be tons of exclusive and
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completely free online sessions with
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speakers like the COO of open AI the VP
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of research at Microsoft and even Kathy
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Wood from AR
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invest uh-oh but whether you attend GTC
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in person or online I want to make sure
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I'm giving you as much value as possible
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so anyone who registers for at least one
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session using my link below can win an
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Nvidia RTX 480 super graphics card worth
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up to $1,300 this thing is heavy and if
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you do want to come to GTC in person my
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link comes with a 20% discount for your
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pass either way all you have to do is
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attend at least one session in person or
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online take a screenshot and send it to
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me after the conference by going to
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tickers symol you.com / GTC I'll post
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all of the links below for your
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convenience and I'll announce the winner
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a few days after the conference to give
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everyone some time to enter all right
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let's Dive Right into Super Micro
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computer ticker symbol smci which was
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founded in Silicon Valley in 1993 the
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same year as Nvidia super micro designs
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integrates optimizes and delivers
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everything from fullscale server and
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storage systems down to individual
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workstations for a wide variety of
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verticals from cloud services and AI TR
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training to 5G and Edge Computing almost
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all of their products are ready to go
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out of the box the customer can just
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plug in their data and their power
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cables and they're ready to go but
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instead of competing with companies like
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Nvidia AMD and Intel smci partners with
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them and turns their chips into custom
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Computing Solutions adding the right
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Power Electronics high-speed networking
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Solutions Cooling and even the right
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firmware and software is needed in my
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opinion super micro has two big
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competitive advantages over other
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original design manufacturers the first
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is that they're headquartered in Silicon
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Valley not Taiwan or China here's why
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that matters let's say that Nvidia
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designs a new GPU like their upcoming
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Blackwell B100 accelerators Nvidia can
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share those B100 designs with super
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micro so that they can lay out and
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optimize the boards the connectors the
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cooling and whatever other components
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they need to keep the B100 at Peak
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Performance when it's installed in an
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actual server rack and since they're
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right down the street updates and
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changes to the B 100's design are easy
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to manage and on the flip side super
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micro is only about 15 M from Google's
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headquarters as well so they can make
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sure that nvidia's chips or intels or
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amds are optimized for the actual data
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centers that they'll end up going into
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and that they're ready to go as soon as
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possible that speed is everything every
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part of Super Micro computer is set up
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to minimize time to Market which means
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that super micros customers can start
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earning Returns on their infrastructure
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Investments even faster especially if
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they're getting the best chips up and
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running before their competitors and
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that's where super micros other big
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competitive Advantage comes in their
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server Solutions are all completely
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modular super micro calls these modules
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server building blocks some customers
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might need more storage While others
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might want more memory some data centers
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might want more CPUs While others want
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as many gpus as they can get super micro
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also has more universal server building
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BLX for power Cooling and networking
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that can each be optimized for different
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markets or specific kinds of workloads
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this building block architecture is what
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lets smci very quickly build solutions
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for so many different kinds of verticals
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when a company like Nvidia launches a
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new chip super micro doesn't need to
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design a whole new server system for it
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they just design a new building block
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and that building block can connect to
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the rest of smci ecosystem super micro
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is actually giving a talk on exactly
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this topic at Nvidia GT
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so if you're looking for a great session
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to attend online or in person or you
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just want to win the sweet 480 super GPU
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check out super micros talk on deploying
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some of the world's largest AI compute
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clusters for large language models smci
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stock is already up by around 40% since
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I covered it just a few weeks ago
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because it got added to the S&P 500 like
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I said at the start of this video the
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best way to find great stocks before the
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rest of the market is to understand a
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company's products not just the their
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profits and of course the global
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artificial intelligence Market is the
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hottest Market on the planet right now
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it's expected to more than 15x in size
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over the next 10 years which amounts to
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a staggering 37% compound annual growth
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rate and super micros earnings should
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grow along with it and while this AI
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boom is going great for super micro it's
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also going great for AMD which is up 52%
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year to date and over 25% since my
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latest video on it huh not too shabby
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the main complaint I always hear about
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AMD stock is its price to earnings ratio
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which is currently around 400 but price
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to earnings is easily the worst metric
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to judge any High Growth Company by and
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it's the single biggest reason many
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so-called value investors Mis major
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moves in the market and then complain
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about valuations from the sidelines in
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my opinion a much better metric for AMD
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is its forward price to sales ratio
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which is currently around 13 that's not
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cheap but it's well below Nvidia stock
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which has a forward price to sales ratio
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of 19.3 or arm Holdings which is
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currently trading at a whopping
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37.5 and I honestly think that AMD sales
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will outperform expectations over the
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next few quarters for two key reasons
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first they're coming out with
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competitive products on a price to
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Performance basis amd's Mi 300X is
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designed to compete directly with
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nvidia's h100s in both a single and 8
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GPU configuration including software
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optimizations amd's gpus appear to
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perform around 30% faster on at least
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some inference workloads for large
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language models such as prompting llama
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2 and while nvidia's h200 gpus come out
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in a couple months followed by their
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next Generation B100 Blackwell chips we
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all know that Nvidia currently has way
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more demand than Supply at least for now
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meta platforms alone ordered
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350,000 Nvidia h100s for their future AI
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projects in including developing
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artificial general intelligence that
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could learn to perform a wide variety of
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tasks uh-oh as cloud service providers
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and supercomputing clusters keep placing
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massive orders for nvidia's gpus the
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wait times are still around 3 to 4
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months and could be longer for their
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newer chips guess who companies are
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going to buy from if they don't want to
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pay those prices or wait that long AMD
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is the only other data center GPU
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designer in town which means I can own
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the entire data center GPU Market with
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just two stocks Nvidia and AMD that way
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I win no matter what and I get rich
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without getting lucky the data center
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GPU Market is expected to almost 7x in
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size over the next 9 years which is a
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compound annual growth rate of
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24% and we haven't even talked about
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amd's server CPUs amd's current fourth
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generation epic server processors have
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up to a whopping 128 CPU cores on a
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single chip AMD has more than doubled
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their server CPU market share since they
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released these fourth generation epic
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processors back in 2022 but photos of
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prototypes for their fifth generation
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processors which are code named Turin
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have been popping up online and they're
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coming with some pretty serious upgrades
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like having up to 192 cores on them and
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each core having access to roughly twice
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as much shared memory as their current
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chips increasing the number of cores and
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the amount of memory that each core can
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share are two tricks that AMD has been
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using to consistently take market share
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away from Intel since 2017 and these
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Turnin chips should take it to a whole
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another level AMD is expecting to
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average over $2 billion in quarterly
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data center Revenue in 2024 and I
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honestly think that could be
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conservative their data center Revenue
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last quarter already came in at $2.3
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billion which was up 37% year-over-year
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and a whopping 43% quarter over quarter
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and while it's true that AMD expects
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sales from their client embedded and
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gaming segments to all declin
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sequentially I think that's because
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they're starting to transition their
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overall focused to powering AI in data
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centers just like we saw Nvidia do back
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in 2022 and we all know how that worked
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out so if you want to learn more about
00:10:16
how fast these AI markets can grow as
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businesses everywhere start using
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nvidia's and amds platforms to power
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their generative AI efforts you don't
00:10:25
want to miss this talk at Nvidia GTC on
00:10:28
solving the generative AI infrastructure
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challenge in 2024 that's a great way to
00:10:32
learn more about the science behind
00:10:34
these stocks speaking of which the third
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stock on our list is Netflix which has
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quietly doubled over the last year I've
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been thinking a lot about streaming
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services in the era of generative Ai and
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I believe that Netflix could be one of
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its biggest beneficiaries let me explain
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why first Netflix has AI baked into
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everything they already do like how they
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calculate the similarity between any two
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pieces of content to show show you
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movies and shows closest to the things
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they already know you like that's called
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content filtering and it's why Netflix
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has those famously specific content
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categories like gory foreign satanic
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stories or visually striking nostalgic
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dramas or my personal favorite underated
00:11:15
romantic road trip movies eh Don't Judge
00:11:17
Me another way Netflix uses AI is to
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group users together based on their
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viewing history preferences and patterns
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of behavior when enough people in the
00:11:27
same group of users like a new of
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content Netflix will recommend it to
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everyone else in that group since they
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should have similar tastes likewise if
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enough similar members don't like a
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piece of content Netflix won't promote
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it to the rest of that group this is
00:11:41
called collaborative filtering and
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getting this right is how Netflix keeps
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improving watch times all right now
00:11:47
let's get into the sneaky stuff did you
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know that Netflix uses computer vision
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to find the most visually appealing
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scenes in every video and automatically
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turn them into thumbnails Netflix's AI
00:11:58
system a automatically makes up to a
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dozen or more thumbnails for each video
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and the one that you see is the one they
00:12:04
think you're most likely to click that's
00:12:06
why you and your friends or family can
00:12:08
have such different looking Netflix
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feeds even though you might be watching
00:12:12
some of the same content Netflix also
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uses machine learning to help identify
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groups of users who might be underserved
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by their existing content as well as
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gaps in their overall content catalog
00:12:23
Netflix also uses that data to help
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identify what kinds of original content
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to create and what they think will
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perform well and this isn't some little
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gimmick Netflix has produced over 1,900
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Originals so far and they've earned over
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30 Emmy nominations and over 20 wins
00:12:40
this year alone now here's where
00:12:42
generative AI comes into the picture
00:12:45
just a few weeks ago open aai released a
00:12:47
text to video model called sora which
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can generate videos up to 60 seconds
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long including highly detailed
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environments complex camera motion and
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multiple lifelike characters just take a
00:12:59
look at some of these stunning scenes
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all of which are totally AI generated I
00:13:03
think that Studios of all sizes will use
00:13:05
tools like Sora to create content faster
00:13:08
and cheaper than ever before content
00:13:11
that Netflix would be willing to acquire
00:13:13
Netflix is also number one when it comes
00:13:15
to offering content in different
00:13:17
languages whether that means subtitles
00:13:19
or full-on voiceovers well AI is perfect
00:13:22
for expanding the number of languages
00:13:24
that existing movies can support now
00:13:26
we're stuck on this stupid Tower in the
00:13:29
middle of nowhere and I don't blame you
00:13:32
and now we're stuck on this stupid stuck
00:13:35
on this stupid freaking Tower in the
00:13:37
middle of freaking
00:13:39
nowhere and it's all my
00:13:46
fault finally I can watch all my
00:13:48
favorite understated romantic road trip
00:13:50
movies in Japanese all kidding aside
00:13:53
more languages means content creators
00:13:54
and Studios can reach a larger audience
00:13:57
which means they can take more creative
00:13:59
risks on content instead of just
00:14:01
sticking to sequels that's a win for
00:14:04
everyone but let's take it to the next
00:14:05
level about 5 years ago Netflix released
00:14:08
an interactive episode of Black Mirror
00:14:10
called bander snatch it was a Choose
00:14:12
Your Own Adventure where your decisions
00:14:14
during the episode changed what you saw
00:14:16
next and there were even multiple
00:14:18
endings well what if a streaming service
00:14:20
used something like LTX Studio which can
00:14:23
generate an entire storyboard for a
00:14:25
movie from a single prompt it uses
00:14:28
pattern recognition to link scenes
00:14:30
together and then a human can go in and
00:14:32
make edits to anything in a scene from
00:14:34
something small in the background to the
00:14:37
lighting all the way to the main
00:14:38
character themselves and once a
00:14:40
character is generated they stay
00:14:42
consistent through the entire movie I
00:14:44
wouldn't be surprised to see all of
00:14:45
these Technologies eventually make their
00:14:47
way onto Netflix where instead of just
00:14:49
personalizing thumbnails and
00:14:51
recommendations the content itself could
00:14:53
be personalized to the user are you
00:14:55
somebody who likes more action and
00:14:57
adventure scenes throw a few few more in
00:14:59
there are you somebody who likes more
00:15:01
dialogue and World buing pepper in a few
00:15:03
extra scenes up front are you somebody
00:15:05
who only watches movies if they're 90
00:15:07
minutes or shorter here's a version
00:15:09
without any extra fluff Netflix already
00:15:12
produces way more original content than
00:15:14
any of its competitors not to mention
00:15:16
they have more subscribers than their
00:15:18
next two biggest streaming competitors
00:15:20
combined they reported over 260 million
00:15:23
members at the end of 2023 so if you
00:15:26
want to learn more about how Netflix
00:15:28
bakes a I into so many parts of their
00:15:30
business check out their session at GTC
00:15:32
on streamed video processing for cloud
00:15:34
scale Vision AI Services during that
00:15:37
session a computer vision systems
00:15:39
engineer from Netflix and an AI engineer
00:15:42
from Nvidia are going to show off
00:15:43
prototype video processing Technologies
00:15:46
for the next generation of streaming
00:15:48
I'll leave my registration link for GTC
00:15:50
links to all of the sessions that I
00:15:52
mentioned in this video and the link to
00:15:53
enter to win the Nvidia RTX 4080 super
00:15:56
graphics card in the description below
00:15:58
trust me you don't want to miss GTC this
00:16:01
year and if you're attending in person
00:16:03
I'll see you there but if not make sure
00:16:05
to comment below with what you want me
00:16:07
to cover so I can provide you with as
00:16:09
much value as possible while I'm there
00:16:11
all right I know this video was a little
00:16:13
long but I wanted to be thorough since
00:16:16
generative AI is creating so many huge
00:16:18
opportunities for investors in a wide
00:16:20
variety of industries from data center
00:16:23
infrastructure to AI processors and
00:16:25
accelerators and even the cloud services
00:16:27
that are being built on top of them all
00:16:29
of which I touched on in this video and
00:16:32
in my opinion the way to find the
00:16:33
winners in these quickly growing markets
00:16:35
is to understand the science behind the
00:16:38
stocks so if you feel I've earned it
00:16:40
consider hitting the like button and
00:16:41
subscribing to the channel that lets me
00:16:43
know to put out more research like this
00:16:46
either way thanks for watching and until
00:16:48
next time this is ticker symbol U my
00:16:50
name is Alex reminding you that the best
00:16:53
investment you can make is in
00:16:57
you
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