The 5 Best Growth Stocks for Second Half Of 2025

This is a time where we can take a look at our portfolios, look at the holdings we have, the companies we're invested in, and see if we still like them. It's a good time to remind ourselves that we can change things if we don't like it. If we think that there's a stock that we don't like in our portfolio or one that's not going the way that we want, we can move things around. That's what we're going to be doing in this episode. We're going to be reviewing these companies in the StoryFund. We'll be reviewing the performance of this and seeing how this has had such remarkable performance. The StoryFund now has a gain of $143,000. That's nearly a doubling of this portfolio, of the invested capital, in only four years. So how did this happen? How are we able to grow this portfolio this quickly? We'll be going over it in this episode. Now, of course, we also have a lot of other stuff to get to. We have news that Meta is now aiming to have fully automated ads created using artificial intelligence. 100% artificial intelligence. So if you don't think it's here already, it is only a matter of time. You're going to be scrolling through your Instagram feed and you'll be seeing entirely artificial intelligence ads and likely you won't be able to tell. That's the world that we're living in now. I have some thoughts on it. And, of course, we have the man himself, Tom Lee, going on to CNBC today and you'll never guess it, he's bullish. We'll explain why in this video. So we have a jam-packed episode, a ton to get into today, and just something that I try to note at the beginning of the month. That if you haven't tried out Qualtrim, now is the time to do it, because if you've joined this website today, you get the entire month for free as a free trial. This gives you time to try it out and make sure you love it before you pay a dime. Now, Qualtrim is a website that I own 100% of, and when I have full ownership of it, that means that I can keep prices very low. So this thing is $10 a month and it's much more powerful than many competitors charging two to three times as much. There's a lot of them charging $20, $30, even $50 per month, and this is so much easier to use. It's just a lot better. You can see all the fundamentals at a glance. We have different pages here, like the watchlist page. You can go over and see advanced watchlist features, like moving averages, all your news, upcoming earnings dates. It even has an entire earnings calendar, like a really in-depth one that shows you AI analysis of upcoming earnings. I can look at Dollar General here, for example, and see what's going on with the company at a glance, get context. And we have more and more features coming. We have transcript summaries of earnings calls. You can go through and read by topic what's going on with all these stocks. We have discounted cash flow features. At a glance, you can do DCFs on any company, buy earnings, or cash flow. And we have a huge update coming this week with the portfolio section of the website. You're going to be able to upload your portfolio you're waiting, hit a button to analyze it, and Qualtrim will use AI to analyze your portfolio. I've tested it. It's super cool. We'll be showing it off later this week. So try out Qualtrim. You're going to love it. Now, let's go ahead and get to the episode. Now, like I mentioned before, we've made it to June. We're roughly halfway through the year now, and we've made it to the beginning of a new month. And I believe that's a good time to take a look at our portfolios, our investments, and make sure that they resemble the type of companies and the type of structure of portfolio that we want. In many cases in our heads, we get the idea that we have to wait till the beginning of the year to make any changes. That's when we work on our diet and say we're not going to order DoorDash anymore. We're going to work out every day. We're going to get a six-pack. And we eventually abandon all of those goals two weeks into the year. That all happens at the beginning. That's where we set all of our resolutions is in December going into January, and I don't think that should be the case. Every single month is a new opportunity to take a look at our portfolio and make sure it's what we want to be invested in. So there's no time better than June, halfway through the year, to do this now. Now, when I look at my portfolio, the performance of this, I'm not trying to brag here, but it's just a fact, it's been staggeringly good in the story fund. It's not without volatility. It's not without going through difficult times. But right now, the performance of this portfolio is incredibly good, benchmarked against both the S&P 500 and the QQQ. To put this in perspective, this portfolio value is only $341,000, so $341.9. And right now, we have $143,000 of that being pure gains. Around 80% of this portfolio's growth is through pure gains. Around 20% of it has been added capital. Now, part of the reason this is important is because of the timeline. This near doubling of stock performance has happened in only four years. We still have another year to make this five years. Now, under normal conditions, if you have a portfolio that compounds around 10% per year, meaning the market average, what the S&P 500 has done, in 10 years, you'll have around 2.6 times your portfolio, so 260% returns. If you compound that portfolio at 15% per year, that extra 5% nearly doubles your total returns over that 10-year period. And that's the tricky part of compounded growth. Nearly everyone underestimates the power of compounding. Just those extra percentage points, from lead to astronomical differences over time. With this portfolio, my goal has always been to compound it above 15% per year. At a 15% compounded growth rate over a five-year period, that doubles your capital. So you invest $100, you compound it at 15% for five years, you end up with roughly $200. You do that again and again, and you far outperform the market. Now, that's what we've also seen when we track this relative performance. Whether you put this against the S&P 500 or the QQQ, the story fund has far outperformed. We've gone through time periods, like I said in 2022, where it was below the S&P 500. When we invested in Netflix and Amazon and Google during those time periods, it far outperformed the market indices. When we look at this overall, the time-weighted performance of the story fund is 111%. So that's where it stands right now, against the S&P 500, which is right around 47%. I've plugged in the QQQ and it's right there with the S&P 500, right around the same. Now, a way of looking at this is the gains in this portfolio are around double what they would have been otherwise if I had invested in the S&P 500. So the $142,000 gains would look more like $60,000 to $70,000 had I invested in the S&P 500 over the same time period. And that wouldn't be bad, having $60,000 or $70,000 in gains would be fine, but it's not the same as having $142,000. That extra alpha came from our individual stock picks. Now, again, all of this is great. It's fun to look at this and see that you've had good performance and that we've been lucky and fortunate enough with this. But the big problem here is that when this happens, a lot of times investors have anchoring bias. They start to just sit on their wins and not do anything different. They don't analyze their portfolio and they don't look at it through an objective perspective. That's called anchoring bias. And I believe anchoring bias is one of the most pernicious problems for investors. One of the things that causes more underperformance than possibly any other behavioral bias. And the entire problem with anchoring bias is that investors anchor on to different companies, different price points, different thought processes, and they become rigid, unwilling to change or adapt to new information, to new objective views. This is part of the reason that ETFs do so well, as they aren't anchored to anything. They will systematically change around any holding at any time. They have no love or hate for any stock. They do it all systematically and objectively. With humans, we have relationships. We anchor on to stocks. People have relationships with stocks like Palantir or Tesla or SoFi or even Costco, right? You can fall in love with a stock to the point where you're not objective with it anymore. And as investors, we always have to be analyzing whether or not we are anchored to a stock and not looking at it objectively. So as I look at this performance, even though it's great, it's time to look through this portfolio. And not just the past performance, but the future. And make sure this portfolio and the weighting is what's best for the future. And we'll start off with Netflix. This makes up the biggest portion of my portfolio, roughly 41%. So four-tenths of this portfolio is Netflix. $140,000 of value and $83,000 of that being gains. Now, I'll save the whole story of Netflix for another day, but we want to look at the future of this company. What I've done every single month, and this is something that's for Patreon members, I come out with this list which is my sentiment list. Meaning, my current sentiment of how I view every stock, my kind of thoughts on them, and I have three different categories of how I rate them. I have in green here, attractively valued. Meaning that these stocks present very good asymmetric risk to the upside. Then I have in yellow here, reasonably valued. As the title says, it basically just means I think they're in a reasonable valuation landscape. Then we have premium valued, which means that there's a lot priced into the stock that is probably not the best time to buy it. Even though the stock may outperform, there's just better times to buy it than when it's premium valued. So these are the three different types of valuation categories I have. Attractively, reasonably, and premium. When I go down to Netflix, and this is what it was last month, 30 days ago, I had Netflix listed as reasonably priced. So that was my thought process on the company. I go over the performance of it and how this one has performed so well. Now when we look at Netflix today, and we look at how it's performed over just the past one month, it's up nearly 7%. It doesn't surprise me that the stock is up 7% despite the high P.E. ratio. Netflix trades at a 45 P.E., 39 by next year. It's in a high P.E. ratio, but again that only tells you part of the story. Netflix has far more earnings power than most companies, and far more predictable earnings power than most companies. So when you put that in the context of the P.E. ratio, it starts to make more sense. Investors aren't just pricing in how much money a company is going to earn next year, they're pricing in how much money a company is going to earn over the next 20 years. And if they start to believe that a company is going to generate enormous amounts of profits for long time periods in the future, they will bump up the price to price that in today. So that's what's happening with Netflix, and I believe that's going to happen more and more in the future. In particular with Netflix, one thing that I believe protects the downside in this company is simply cash flows. So when we look at Netflix, there's a time period where their cash flows were all over the place. It was minus three billion dollars, then it went up to 2.46 billion. In 2022, or in 2021 rather, they were making no money. Zero cash flows, absolutely neutral. They grew revenue dramatically with their password sharing crackdown, with price increases, with advertising revenue, and they held steady on their content spend, creating this massive widening gap of free cash flow profit margins. So when we look at it, their free cash flow every quarter just jumps substantially, going all the way up to seven billion dollars. And if we zoom in on this to just the past 10 years, you can see this a bit clearer. They've been able to keep this seven billion dollars of trailing free cash flow every single quarter, and I don't believe this is going to go down again. I don't believe that Netflix's free cash flow will really ever go below seven billion dollars again. In fact, I think the only direction this is going is up. So when we look at safety with a stock, I first analyze it by the safety of the cash flows. If Netflix's free cash flow went back down to zero, we'd be in trouble. The stock may get cut in half. There would be problems, but it's not going that direction. Netflix's free cash flow is likely to continue to grow over time. This free cash flow of 7.5 billion dollars gives a natural base level to the valuation of the company. It prevents it from ever having another doomsday scenario. So in terms of protecting the downside, I feel that Netflix is far more resilient now than it was five years ago. The stock, of course, can trade around. It might trade around 10 or 20 percent, but I don't believe there's going to be any critical moments where the cash flows tank again for Netflix. The other thing that I've been looking at with Netflix, and I've become very convinced of, is that management leak. Remember when the management team had a discussion internally talking about their internal ambitions to double the market cap from 500 billion all the way to above a trillion? Netflix's management internally—this was intended to be just internally, not leaked to the public—they discussed that they want to double their market cap to a trillion dollars. They want to double revenue from where it stands today. They want to triple operating income from 10 to 30 billion dollars, and they expect massive advertising revenue growth as well. Netflix said that they were incredibly saddened that this was leaked. It was not something that they have as projections, but it is their long-term ambitions. Now, I've looked over the numbers that they've given, and I've done a lot of reverse DCFs to see how attainable this is. In fact, I did an entire hour-long exclusive episode on just these goals from Netflix. And my conclusion is that this is aggressive, but achievable. Netflix can accomplish this goal of doubling the market cap over the next five years. Now, you don't have to be great at math, but just knowing that you're going to double a market cap over five years leads to good returns. Implied in that is a 15% CAGR. You're getting well above the market's historical returns on both the S&P 500 and the QQQ if they accomplish this. But there's also reason to believe the returns would be better. They're doing buybacks. They do a lot of buybacks over this time period as well. The returns could be around 17%. So, if Netflix is able to accomplish this goal of doubling their market cap, doubling their revenue, tripling their operating income over the next five to six years, investors today will still beat the market by a large margin. Anchoring bias works both ways. Some investors will look at Netflix today, see the $1,200 stock price, and go, wow, there's no way I'm buying it today when I could have bought it at $200 in 2022. I missed the train on this one. That's being anchored to that price point. And again, that is the pernicious deception that happens to investors. These anchoring biases of when we say, I could have bought this stock here, I could have bought it there, so I'm not going to buy it now, is not objective or rational. We should look at the facts today as they stand now, not what could have been or what would have been if we would have bought stocks at different time periods. We need to erase that and look at how facts stand today. And Netflix today still represents one of the best opportunities of outperforming this market over the next decade. We have other articles and other publishers now agreeing with this, even as Netflix nears $500 billion market cap, why its stock is still a buy even at these levels. Now Barron notes that the biggest problem with Netflix currently is not the story of the company, that's been defeated, now the story looks great, but the biggest problem is valuation. The only real mark against the stock right now is valuation. Due to the recent rally, shares aren't cheap, they currently fetch around 43 times future earnings, meaning they're trading at a significant premium to both the S&P 500 at 21 times and the Mag7 group of mega cap tech names that often are compared to at 27 times. Still, Netflix has averaged a price to earnings ratio of 52 over the past five years. So judging by the recent history, Over that time, the stock has gone from a loss-making challenger where everyone was skeptical about how much money it was spending on content, to now a reliable profitable compounder. Now there's different analysts like Ben James at his firm saying the firm holds a little more than 4 million shares, a position that's valued at roughly 4.5 billion. Now from their perspective, their bold case hinges on the idea that the streamer will be able to grow earnings at a fast enough rate to maintain the stock's recent momentum. James argues that operating margins, currently at 27%, could nearly double by the end of 2030. They absolutely can. If you look at the math of how Netflix operates, they have incredible operating margin. Content is one of the most scalable products in the world, with incredible operating leverage. Now he says over the past decade, Netflix has managed to engineer a self-sustaining cycle of growth, in which more subscribers means more money spent on content, which in turn attracts even more subscribers. That's the Netflix flywheel every investor in Netflix knows that is the core thing driving this company. More content, more subscribers, even more content, which leads to more subscribers. It is a fire hose of revenue that's used to build this huge amount of content every single week. They say now the streamer has already done the hard work, pouring money into creating this vast library of films and movies. Quote, it's invested so much in its own content that it's built a flywheel that will keep growing its margins. When we first invested in 2015, its margins were roughly around 4.5%, and our forecast was that they would reach 50% within 10 to 15 years. So it's over halfway there, and we think it will get all the way there. So when I ignore all gains that I've previously made in this company, when I ignore the whole past performance, how much I'm up in the stock, when I look at this company with fresh eyes today, I still believe Netflix represents one of the best opportunities in the equity markets. And I strongly believe that there's a very high probability of this stock continuing to outperform the S&P 500 and the QQQ. So Netflix is one that I'm going to continue holding in the portfolio, and I believe it will lead to greater outperformance. Now we move on to number two, which is Amazon. Amazon is also a massive position in this portfolio, making up 36%. It is a $123,000 position with $31,000 in gains. Now let's first start by taking a look at what my sentiment was a month ago for Amazon. I have it right here. The sentiment for Amazon was attractively priced. My commentary was that Amazon's latest earnings report has made me more incrementally bullish on the company long-term. They continue to grow strong in the most important segments of business. Andy Jassy has a clear direction of focus in cloud infrastructure, AI, online retail, advertisement, video entertainment, and logistics. Now that list of stuff may seem broad and unfocused, but if you look at what Amazon's actually going into, these are all incredibly important verticals, and they can layer artificial intelligence into all of them, optimizing every part of the company. So I have this one as my most undervalued rating, which is attractively priced. Now if we look at where Amazon stands today, a month later, the stock price is $206. If we look at the performance over the past 30 days, it's up 10.49%. So Amazon has moved up from around $185 now to $206. The question is, where does it stand now, and how has my sentiment changed? I still view Amazon today as meaningfully undervalued, and I see this stock moving up to $220, to $240, to $260. I think it's only a matter of time until that happens, and there's a couple catalysts that will make that happen. The biggest challenge with Amazon is investors are constantly playing this game of how profitable is a company really? You look at this stock, and you don't really know how much money they can generate, how much profits they could generate, if they really wanted to. Because Amazon is always chasing this carrot at the end of the stick. They're always chasing some other big opportunity, which they throw all their would-be profits into to grow new verticals and new opportunities. Now this is the Amazon playbook. You create a lemonade stand, you make it highly profitable, and then instead of making that lemonade stand show the profits on the balance sheet and the income statement, instead you direct that cash into a hot dog stand. The hot dog stand will lose money for the first year or so, but then it will become profitable. And you have a profitable lemonade stand, you have a profitable hot dog stand, and instead of taking those profits and directing them into buybacks and dividends and showing enormous net income and free cash flow and earnings per share, you don't do that. As Amazon, you're still in day one, you're still in startup mode. So you create an ice cream stand, and you have that be a new venture that requires new CapEx to get the freezers and the stand and everything, takes a little bit of time to get profitable, and then you have a profitable lemonade stand and hot dog stand and ice cream stand, and you do that over and over and over again. This is the playbook of Amazon that seems never-ending. And investors are always tasked with this big challenge of trying to determine if Amazon stopped doing this thing where they put all this money into new ventures, how profitable would the company actually be? How much money would they make? Because right now, it looks like they literally make no money. By that, I mean quite literally, Amazon looks like a money-losing company, or in fact, a money-neutral company. We can go to the free cash flow of Amazon, and we can look at it on a trailing 12-month basis. You can see how much of a rollercoaster this is. It goes up over time, then down dramatically as they do investments, then it goes back up, and now we're back in that downward motion as they're doing big investments into artificial intelligence. Now, to look at this more clearly, we'll zoom into the past 10 years. This is on a quarterly basis, trailing 12 months. And if we look at the most recent trailing 12 months, they have generated $20.8 billion in free cash flow, which is low. That is low for a company the size of Amazon. To put that in context, Amazon is around the same market cap as Google. Google generates around $70 billion of free cash flow. So Amazon, at the same market cap, is generating around a third, around a fourth, right, as much free cash flow. But then Amazon also does a lot of stock-based comp. We have a chart here to put that in context. When you bring up the stock-based comp, over the trailing 12 months, Amazon did $20.74 billion in stock-based comp. That's how much dilution they use to pay their employees. And a lot of people argue that this isn't cash, but in terms of an owner's perspective, this does eat into your cash. It dilutes the shares that you own, making it so that you own less of those cash-paying shares, or you own a smaller percentage. So it does have impacts directly from an owner perspective. So $20.74 billion of stock-based comp and $20.81 billion of free cash flow. Or another way of putting this, it basically nets out. When we look at this on a netted out basis, Amazon generated $71 million for investors. That's less than Texas Roadhouse, which is a $10 billion market cap company. Texas Roadhouse did around $300 million of free cash flow for investors. Amazon, which has well above 200 times the market cap of Texas Roadhouse, generated less free cash flow over the trailing 12 months for investors than Texas Roadhouse. And that is my point by saying that Amazon looks in some cases like it makes no money. So this is a lot of work for investors to determine how much money they actually make. The difference between an Amazon and a Texas Roadhouse is even though they're generating almost no cash for investors today, the opportunity that exists with Amazon is massive. The implied earnings of this company is massive. In fact, I believe it's greater than Google. And there's a couple things that hint to their real underlying profitability. One of them, of course, is simply just looking at history. If we look at Amazon here, they did just make $48 billion in free cash flow just a couple quarters ago. The company has grown since then. So simple logic dictates that if they made $48 billion just three quarters ago or four quarters ago, they could do that again if they so chose. So we have a baseline set right there. Another thing that we're looking at is Amazon's pouring money into this CapEx investment. Enormous amounts into CapEx. Just take a look at this. It's gone up nearly double since 2020 or 2021. And they're not doing this chasing something where they believe they'll get a low return. Andy Jassy has been quite clear that he believes he'll get a very attractive return on this money spent. Now, that's up to your own judgment if you think they will. But if we look at this on an earnings basis or a net income basis, we have Amazon earning $66 billion in net income. When we split that by the share count, we get the earnings per share, and we have $6.14 in earnings per share, up 71% year over year. So even though the free cash flow is showing that this company is unprofitable or basically making no money, we have the net income, we have the earnings per share telling a different story. The accounting on this doesn't factor in all that CapEx spent immediately. Another thing we can look at is the recent commentary and financial performance of Amazon. For example, in their most recent earnings, they mentioned that their operating income was $18.4 billion, up 20% year over year. Now, operating income is before the CapEx is taken out. So this is how much money they're making before you take out all the CapEx going into AI. So it doesn't paint a full picture. CapEx, of course, is a real meaningful expense. But the operating income or the core income of the company continues to grow at a very fast pace, 20% year over year. This shows that if Amazon moderates their CapEx spend at all, if they slow down on it or it goes down at all, their free cash flow will explode. The company's growing top line, they're growing operating income. The only thing that's preventing them from becoming incredibly profitable is their explosive growth in CapEx. And I expect it to moderate over time. So my expectations for Amazon is that this company will become more free cash flow profitable than Google. It'll generate well over $70 billion per year. And I believe that that's on the low end. I could see Amazon's free cash flow moving up to $80, $90, or $100 billion, generating as much in profits as Apple does currently. If that's the case, this company should gain another trillion dollars market cap. So even as I look at Amazon today in my portfolio, occupying roughly 36% of the story fund, the question for me is to get rid of anchoring buys. Do I still want this company as this big part of my portfolio? Is it still one of the best options deserving the suading? And the answer is yes. When I look at the relationship this company has with customers, the long lifetime value, the vertical that they're in, and their opportunity to rapidly and substantially grow free cash flow margins over time, I believe that Amazon still today, looking ahead, is one of the best investments in the market. I think it will outperform the S&P 500 over the next five years. Now, next up, we have Google. This is a company that I have across both of my portfolios. It is a $32,000 position in the story fund, making up 9.3% of the portfolio. I said a month ago that Google was attractively valued. I have it here. And this one has been attractively valued, from my perspective, for some time. So I've had a series of month after month where I still believe this company represents an attractive investment. Now, the first reason that Google is an attractive investment is simply the valuation metrics. It doesn't take much of a leap to show that this one is a good asymmetric bet. It trades at an 18.6 Ford PE ratio. Based on next year's earnings, it's around a 17. The free cash flow yield is 3.6 when not adjusting for stock-based comp. But even if you factor in the 30% hit to stock-based comp, that's still a 2.5. The big question for Google is whether or not they're getting disrupted. We have these different narratives of chat GPT, of perplexity, of llama, of co-pilot, all these different AIs that may take away from Google's search. Now, Google has responded by saying that organic search trends, the amount of volume of search, continues to increase. Investors are using it more. They're implementing ads with it. They're monetizing at the same rate. From Google's perspective, there are more different ways to search. Through Google Lens, through their Siri-like product, through Gemini, and through AI mode. So they're encompassing this whole spectrum of search. They believe that information gathering is going to be much bigger over the next 10 years. That even if other companies do well, that doesn't mean that Google's not going to do well. So from the search perspective, Google is being viewed as though it's being disrupted. The company is being priced as though it's been disrupted. At a below market multiple, the S&P 500 is at a 21. Google is at a 19. So it's trading below the S&P 500 while currently growing much faster than the S&P 500. We also have Google growing a cloud business, growing margins in it. We have them growing YouTube, growing Google Network, their whole ad network. They have a lot of subscription products that includes YouTube Premium. They also have so many other subscription products. Then you have other bets, which is Waymo. Now, Waymo is another product from Google that doesn't get the credit it deserves. For example, we have articles like this This goes over how quickly Waymo has grown. Waymo's paid driverless trips just in California over time is growing exponentially. This is just 2024. Every single month, you're seeing it go up over and over again, now to above 700,000. Waymo just recently completed 10 million rides. It's doing over 250,000 rides per week. We have a KPI in Qualtrom that tracks this based on their public announcements. This is what it looks like. A lot of people say that Waymo can't scale. It's a product that can't scale quickly. What do they expect scaling quickly to look like? This is a product that's clearly scaling very fast. A product that's grown by 25X in a single year, that's fast scaling. By any metric, going up 25 times in a year is fast scaling. The Wall Street Journal notes that it cracked a million total paid rides in late 2023. By the end of 2024, it reached 5 million. We're not even halfway through 2025 and it's already crossed the cumulative 10 million. At this rate, Waymo is on track to double again and blow past 20 million fully autonomous trips by the end of the year. And they're likely going to hit that. This isn't just fast growth. It's incredibly fast growth. The CEO of Waymo said, this is what exponential scaling looks like. On this subject, they also mentioned that Waymo earlier this year entered Austin, Texas through a partnership with Uber. This summer, it's planning to launch in Atlanta. Next on the list is Miami and Washington, DC. The cars are now mapping Boston, Nashville, New Orleans, Dallas, Las Vegas, and San Diego. The past week, the company announced that it's testing Orlando, Houston, and San Antonio. Waymos are even crossing the ocean to begin collecting data in Tokyo. Does this sound like a company that's not scaling? Doesn't to me. It sounds like Waymo is scaling quite fast in lots of important cities. Waymo's now bigger in San Francisco than Lyft. In a year, it could surpass Uber. That's how fast this company's growing. Now, even knowing this, what do investors say about it? Investors in Google, many commentators, analysts, people like Gene Munster. What do they have to say about Waymo in particular with Google? Well, even though it's scaling fast, it's just such a small percentage of Google. After all, if we look at how much it actually is, Waymo is only a tiny fraction. So for the Google investor, you should basically just ignore Waymo. It's not a meaningful part of the company because it's such a small revenue part of the company. Now, they say that for Google, but when it comes to Tesla, the idea that Tesla would launch a robotaxi network means that the company should add trillions of market value onto the company. Tesla is worth currently $1.09 trillion. Now, this company that's worth $1.09 trillion did $7 billion in free cash flow, or less than $7 billion. Google's doing $70 billion. So Google's doing 10 times the free cash flow of Tesla, and investors in Tesla will tell you the reason that this company should be valued so much, it should be worth a trillion dollars and not $300 or $400 billion, is because of robotaxi. They'll say that this autonomous fleet of vehicles that's expanding across the globe is worth that much. The potential of it, the profit potential, the global TAM of the robotaxi is worth potentially trillions of dollars. So you see the dichotomy here? Investors in Google should just ignore the outstanding success of Waymo, the rapid growth, the scaling to multiple large cities, taking over Lyft's volume in San Francisco. Google proved that this is a viable commercial product completing hundreds of thousands of rides every single week, tens of thousands a day, and we should all just ignore this because it's such a small portion of the revenue. But with Tesla, it should be priced as trillions, even though it's currently 0% of the revenue. What Google has here is a situation where they do not get the credit afforded to other companies. If Waymo was valued like a Tesla robotaxi product, it would be priced as trillions of dollars a market cap. The company would move from a $2 trillion to a $3 trillion market cap, purely based on the potential of Waymo. And with Google not getting credit for having a fully functional robotaxi network, they do get credit for being disrupted when that isn't in any of the data. They are looked at right now as currently being disrupted, even though they're growing 12% to 13% revenue per quarter. So Google's a company that gets credit on the wrong side in each situation. They're getting credit for being disrupted when they're not, and they're not getting credit for being a robotaxi company, even though they are. And for those reasons, I still feel like this company is an asymmetric bet to the upside. There is a high probability of sentiment improving for Google in the future. And that's the reason why I continue to hold this company, even though I've already held it in the past. Now, next up, we have another familiar company. After Google, we have Microsoft at a 6.8% position, $23,000 position total, 10,500 of that in the green. So over half this position are about half of its gains. The reason why is because I was buying Microsoft heavily in the story fund at $220. I put out a lot of videos about it. It was one of the ones where I thought that this company is at a still right down here in 2022. And the stock price has surged since then. It's gone all the way up to 460. Now, a month ago, my sentiment on Microsoft was that it was trading at a premium price, meaning that right now, Microsoft is probably not the best opportunity out of the companies I could put new capital into. It's trading up in that higher tier of pricing and future growth. When we look at this with the metrics, Microsoft trades at a 32 Ford PE ratio, a free cashflow yield at 2%. So these metrics mean that the company is already trading in that more fully valued territory where there's not as much upside for the company, even if they perform relatively well. Now that doesn't mean that the stock won't outperform the market. Microsoft is going from strength to strength. They are the leader in artificial intelligence in so many ways. They have all these business agreements. They have Microsoft Azure, which is growing incredibly fast, especially given its huge scale. So Microsoft remains in a very good position. When I look at Microsoft today at its current valuation, it's the first one that I would consider trimming or potentially swapping for a different position that I think has more asymmetric upside. For example, if there was a company like Spotify or Shopify that went down dramatically, that for one reason or another, investors got really bare sentiment and the math made a lot of sense on those types of companies, I think I could see myself moving from Microsoft. But as it stands right now, I like owning all the public cloud. I like owning Amazon, Google, and Microsoft, the three big cloud providers. I think that that will be an easy way to outperform over the next three to five years. So even given the more premium valuation of the company, I'm still fine holding this one in the portfolio today. Now, after that, we have S&P Global. This one is a 6.4% weighting, $22,000 position, 5,900 of that being gains. In terms of the stock price today, it trades at a 34 PE ratio, a 3.5% free cash flow yield. When you look at stock-based comp, it barely affects this company because they have a lot of control over their expenses. This company is appropriately valued. It's reasonably valued. It will likely outperform the S&P 500 over the next five years. But similar to Microsoft, if another company came along that I felt was incredibly good, asymmetric risk and reward, I could see myself shaving off some S&P Global and buying into that stock. So these two bottom ones here, both Microsoft and S&P Global, I'd be more likely to sell off than any of these three at the top. And that's how I currently view my portfolio. Now, switching gears a bit, we get to this new story from the Wall Street Journal about Meta. This is making the waves today. Meta aims to fully automate ad creation using AI. Specifically what they're doing, they say the social media company aims to enable brands to fully create and target ads using artificial intelligence by the end of next year, according to people familiar with the matter. Meta's ad platform already offers some AI tools that can generate variations of existing ads and make minor changes to them before targeting the ads to users on Facebook and Instagram. Now the company aims to help brands create advertising concepts from scratch. Now they say that using the ad tools Meta is developing, a brand could present an image of a product it wants to promote along with a budgetary goal. And AI would create the entire ad, including imagery, video, and text. The system would then decide which Instagram and Facebook users to target and offer suggestions on budget. People familiar with the matter said. So this is like this comprehensive ecosystem of creating an ad. And of course, Meta wants to improve this. So this seems very likely, even though it's rumored right now, feels very likely that this is true and accurate. Meta is always looking to improve how advertisers on their system can engage with the platform, create ads, and have all of the friction removed from it. The less friction, the better. Meta also plans to enable advertisers to personalize ads using AI so that users can see different versions of the same ad in real time based on factors such as geolocation. A person seeing an advertisement for a car in a snowy place, for example, might see the car driving up a mountain. Whereas a person seeing an ad for the same car in an urban area would see it driving in a city street. So they're going to create virtual backgrounds for the same advertisement. They're going to have different videos and narratives based on who's actually seeing that ad. So this is a form of hyper-targeted, hyper-curated ads. And this is only possible through artificial intelligence. The overall goal of Meta here is quite clear. They see that a lot of this marketing budget is going to the marketing team itself in the creation of the ad. So companies have to spend so much money on their marketing team to create the ad, and then they can only portion a bit of their budget to the actual advertisement, to the actual ad spend on Meta. If Meta can erase that spend on the marketing team and the marketing budget, then it allows for far more of that spend to go towards Meta. So this is a way of diverting cashflow from marketing teams and creating these advertisements, video editors, photo editors, all the people that do the work behind that, making it so that AI does all of that and the rest of the spend can be directed towards Meta. Increasingly sophisticated AI tools are starting to enable businesses to create full photo and video ads without having to spend money on hiring production and crews. Google released a new version of its video generated tool called VEO at its annual developer conference last month that allows people to create short videos from a text prompt. In the not too distant future, we want to get to a world where any business will be able to just tell us what objective they're trying to achieve, like selling something or getting a new customer, how much they're willing to pay for each result and connect their bank account and then we just do the rest for them. Zuckerberg calls this overall a redefinition of the category of advertising. This is more than likely to allow the companies that could never otherwise afford to advertise in this way, they could never have the budget for creating big productions to finally do so through artificial intelligence. So it basically broadens the total addressable market of advertisement on Meta and it makes sense that as a result, Meta stock is up 3% today. This will overall create far more ad opportunity for Meta and the pie in advertising is going to grow. Now moving on, we finally get to Tom Lee, which you'll be shocked to learn. I know this is very surprising, very surprising for all of us, but he's bullish on the market. He's not bearish. We have a breaking news here that Tom Lee is bullish and you have to give him credit even during the time period, during April 2nd or whatever it was, April 6th where it hit this huge bottom. Tom Lee did not give up on his bullish stance and now he feels like things are getting back to a new bull market. I look at 2026, I think businesses are in better shape now than they were in February. So I think making 6,600 actually seems more achievable today than it did in February. You think a bull market started April 7th or a new bull market? Yes. Market tops usually need an ISM to stay above 50 for a period of time. So I think we're at the start of a bull market and as I look at 2026, I think housing could actually be a big lever to pull next year. So he says we're at the start of a bull market. Now, this might be one subject I disagree with Tom Lee on. Now, not to get too technical here, but it doesn't feel quite like a normal bear market or correction when it's entirely man-made. When we put tariffs on causing stocks to go down, the entirely thing was it was all contrived. We did all of that. We chose to do that. It caused the market to go down knowing that at any time these tariffs could be removed. And that's exactly what happened. There was a change in policy. The tariffs were largely delayed and removed. We had the 90-day delay causing the market to get renewed optimism. It doesn't feel quite like a normal bear market, bull market situation. To me, it feels like we've always been in a bull market and this was some man-made contrived event that gave it a speed bump along the way. Investors that thought it was gonna be something greater that sold out. The hedge funds he talks about that liquidated their positions. That was a huge overreaction both in hindsight and during that time period. The retail investors that stayed put that bought more stocks during that discount are seeing the benefit now. So Tom Lee calls the lows of April the start of a new bull market. He says the S&P 500 could get to 6,600 by the end of this year. And I believe that that's very possible. But in my opinion, we've been in a bull market this entire time. We just had one big speed bump along the way. That's gonna be it for this episode. Hope you enjoyed. See you in the next one.