Stock Market Investors

Our long-time investors are probably wondering why we haven’t made any gains over the last 18 months. First, we have no ability to predict what already popular stocks will stay or get more popular. This includes tech stocks, AI stocks, wide-moat high-quality consistent growth stocks and up and coming future tech leaders. Momentum has been the single best of the factors in factor investing for 15 years! We are paid to be greedy where others are fearful and fearful when others are greedy. To say we’ve been fearful would be an understatement. […]

A mania associated with electric production companies providing electricity to technology enterprises pursuing Artificial Intelligence (AI) agendas looks familiar. An announcement this week by Meta that they signed a deal with Constellation Energy (CEG) and the corresponding surge in the share price of CEG rang a big bell in our minds. Our regular readers will be reminded that a few weeks after the 2024 US presidential election, we made the case that we were in the stock market at the polar opposite of the late-1980 euphoria over President Ronald Reagan’s victory. Stocks were massively under-owned in 1980, interest rates were sky high, and inflation had run rampant. […]

The investors of Smead Capital Management believe, which we count ourselves among, that energy stock valuations in the stock market have become too depressed. Mr. Market gets scared, as he does from time to time. This can go on for a while, but we have seen a couple of private transactions in two different parts of North America energy markets that explain how attractive the pricing is for the assets that Mr. Market could own. […]