Growth rates won’t be sustainable forever; it’s time to rethink Meta, Microsoft and other top tech stocks.
Ahmed Riesgo, Chief Investment Officer at Insigneo, explains why you “definitely’ want to own them now.
Watch the full interview here:
Transcript:
Caroline Woods: Ahmed, let’s start with big tech because meta and Microsoft are both powering higher after earnings. You look at those reports, you look at those growth rates and you think what?
Ahmed Riesgo: I think you definitely want to own them now. I think in the future, despite the moves we’re having today, I think in the future they’re going to look a lot more like utilities and defensive positions in your portfolio. So I don’t think you’re going to get the growth going forward from these names, but you definitely want to own them. They’re fine companies. They’re growing earnings way above the median stock in the S&P 500. So you definitely want to have, a good healthy position of many of these big tech names. Do you want to buy them at these levels though should note that Microsoft just crossed $4 trillion in valuation.
Caroline Woods: Are you a believer in the AI rally at this point, and that there’s still room to run, even if the growth rates aren’t as impressive?
Ahmed Riesgo: Yeah, so I don’t think, you know, you’re starting to hear like, bubble territory talk. I don’t think we’re anywhere near there yet. And like I said, you definitely want to own these names. Now, do you want to Chase them for growth. I think that’s the difference here. I think you want to have them as ballast in your portfolio to hold them more as defensive positions, but I don’t think the growth in the future is going to come from these names, these that remember at this point, these are high CapEx companies. They’re going to look a lot more like airline companies in the future than right now. And what I mean by that is that they’re largely indistinguishable from one another. Anthropic although that’s not a public name, but meta Gemini models, it’s sort of United and delta. Right it’s a preference, but you’re going to have to have them. They’re indispensable. That’s why I’m saying you definitely want them in your portfolios, but you don’t want them for growth. You want them for defensive posturing.
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