This post already aged like fine wine @Pieter93 ! Hope you are Hodling!
Nvidia and AMD are both having much potential at this moment. In 2022 we might gonna see the first processors from Samsung with an AMD powered GPU
COME ON NVIDIA !!!
Slecht nieuws voor Nvidia… FTC wil overname Arm door Nvidia blokkeren
I did read it, but. We will see! Even when this is hurts Nvidia, they will come back! Even higher then they are now! LETS GOOOO
Yes, NVIDIA is too strong and has a monopoly position in the gaming / mining industry at this moment. AMD isn’t on this level yet.
Problem though is that both AMD and NVIDIA are trading at very VERY lofty valuations at the moment while Intel is in the dog house because of all the reasons you mentioned.
However, Intel is more profitable than both of these two combined and is spending a lot of that profit on future improvements. These are not paying off now but will do in the future.
Also, Intel is in a lot more market segments then AMD is, they don’t just make processors for computers.
The ideal time to pick up Intel is therefore around this time, because once these future improvements start to pay off and the PE normalises, Intel will already have increased in share price substantially.
Looking at the metrics, both AMD and NVIDIA surely can go up further but they will also have MUCH further to fall in the next market correction, whereas Intel has much more upside while also having a lot less downside.
Disclaimer: I am building a position in Intel for this exact reasoning.
Intel is a strong player indeed. A correction does hurt younger companies like AMD and NVIDIA but they come back faster as well. I noticed this multiple times.
I’m not sure if Intel is still able to get the market back. Major companies are building their own chipsets. Apples M1 processor didn’t help Intel as well. Also, Intels chart doesn’t look promising compared to other major Tech companies. Time will tell .
Let’s first celebrate Friday and almost weekend. Since we can party until 5 now
I have also shares in Intel because of those reasons! A long time!
I guess this might be the different mind sets in value investing vs growth investing.
I prefer my money to be in high PE companies that actually have proven they can innovate especially in the tech scene. instead of companies that pay a 3% dividend. A company that pays so much dividend DOES NOT have the philosophy to be the most inventive / forward thinking in terms of innovation.
I also personally like companies that already deliver a good product, instead of ‘will do in the future’. With AMD and NVDIA they have proven in the last few years that management is good. While Intel has simply not. There is almost always a pretty good reason why the PE of a company is this low (again, especially in the tech sector, which has notoriously high PE companies).
In my opinion the tech companies live and die by being a fast company that can change things, innovate things, etc. This is the reason why companies like Amazon, alphabet, Microsoft and Apple all have had high PE’s since almost the beginning of their existence, but are now all in the top 5 market cap companies.
But hey, I love my high PE growth stocks, so I might be a bit to biased! And I understand that it is a little bit more risky ^^. But those year to year growth numbers of Nvidia are just on a whole new level.
I prefer my money to be in high PE companies that actually have proven they can innovate especially in the tech scene. instead of companies that pay a 3% dividend.
Normally a company pays a dividend with the money they do not need, or can viably use, for anything useful that benefits the shareholders. There is only so much money you can spend on useful stuff every year.
The fact that AMD and NVIDIA need to spend all their free cash just to stay ahead while Intel has the luxury of being able to pay back shareholders as well as spend cash on getting ahead, is a different way of looking at it
That being said, time will tell.
The “There is only so much money you can spend on useful stuff every year.” really doesn’t work with an tech company. The fact that they do not know where to spend their money on, WHILE simultaneously getting beaten by their competition in terms of quality products tells the whole story of the past 5 years.
There should always be enough money to branch out (like NVIDIA did with the car chips) or upgrade your products. The fact that they don’t know what to do with money while being so massive means there is a fundamental flaw in the management and/or their innovation department. they can go so many ways… This is not a coca cola, where when a product is done, you can just keep selling it for 30 years… You’ll get behind.
But like you said, time will tell. ^^
And the chipmarket is in such a boom that, chances are, both will be profitable stock investments for the coming 10 years.
Hey there Pieter! You can take a look at my topic on AMD that I created yesterday. Happy to give you some information!