Investment Learning

  • October 21, 2024

Nuclear energy: Small modular reactors' role in fueling AI boom

The growing energy appetite to power AI and data center technologies has led companies to search for clean and cost-efficient energy sources, most notably nuclear power. Tech companies like Amazon (AMZN), Microsoft (MSFT), and Alphabet's Google (GOOG, GOOGL) have been signing deals with developers to build out small modular reactors (SMRs) to meet their energy needs. Yahoo Finance special reporter Akiko Fujita dives into the details, highlighting Big Tech's rising interest in the future of nuclear energy. She notes the benefits these SMRs could pose for power grids while no commercial modular reactors have been completed in the US yet. X-energy CEO Clay Sell sat down with Catalysts earlier today to discuss Amazon's investment into the nuclear reactor designer's SMR plans. Watch Kairos Power CEO Mike Laufer interview with Yahoo Finance last week about the nuclear power startup's partnership with Google. To watch more expert insights and analysis on the latest market action, check out more Catalysts here. This post was written by Angel Smith

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  • October 21, 2024

Why this portfolio manager prefers value over growth stocks

Brian Mulberry, Zacks Investment Management client portfolio manager, joins Wealth! to discuss why he prefers value stocks over growth stocks. Mulberry explains that the valuations of the "Magnificent Seven" are getting "a little bit top-heavy." He tells Yahoo Finance, "The S&P 500 (^GSPC) right now is trading the broader market at about a 22 times forward valuation when you're looking at earnings there. If we concentrate that down into the Magnificent Seven, it's still in the mid-to-high 30s. When you can look at the earnings growth that's expected in a place like utilities (XLU) and their forward P/E (price-to-earnings ratio) is only about 9 or 10, there's a much stronger valuation conversation to be had looking at those particular sectors." He notes that in those sectors, there are better-performing individual stocks that will see "durable earnings growth," offering a better investment opportunity. "So we really feel like you can do better at the current valuation levels if you're rotating back to some of those more traditional value sectors, right now," Mulberry adds, pointing to banks as an example. To watch more expert insights and analysis on the latest market action, check out more Wealth here. This post was written by Melanie Riehl

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  • October 19, 2024

SCHD: Split or Not, This Is a Strong Dividend ETF

The Schwab U.S. Dividend Equity ETF (SCHD) is one of the most popular dividend ETFs in the market today with a massive $63.7 billion in assets under management (AUM). The fund recently made some waves by executing a 3-for-1 split which went into effect on October 10th. We’ll discuss the rationale and details regarding the share split in this article. But more importantly, we’ll evaluate the merits of holding SCHD in an investment portfolio. I’m bullish on this well-known dividend ETF based on th

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  • October 18, 2024

ERCOT stepping in to help Texas grid prep for energy demand spike

Texas is among the states seeing the fastest-growing energy demands, with the Electric Reliability Council of Texas (ERCOT) working to expand grid operations and meet customers' electricity needs. ERCOT CEO Pablo Vegas comes on Market Domination Overtime to talk about how the council is planning to satisfy grid demands "Now we're starting to see some of these larger loads coming in faster, like the data centers," Vegas says about AI data centers' expected strain on power grids. "And what we've been doing is we've been planning for this eventuality over the last several years. We are seeing tremendous growth in renewables on the electric grid." He explains one aspect of the regulatory process that allows the Texas grid to get ahead of power consumption strains: "One of the things we do is a process that we call 'connect and manage,' where when a generator wants to come onto the grid, we do not require if there's the potential for any transmission level constraints for that generator, we don't require the whole transmission system to be upgraded before that generator can come online. A lot of other parts of the US do require that, and that's what can take so many years in other parts of the US to develop new power supply." Pablo advises other states' operators to "be nimble" on their regulatory processes and try to find "balance" in growing power supplies, maintaining reliability on said sources. To watch more expert insights and analysis on the latest market action, check out more Market Domination Overtime here. This post was written by Luke Carberry Mogan.

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  • October 18, 2024

A Mag 7 underperformance could be an opportunity for the S&P 493

Mega-cap tech stocks, which are part of the Magnificent Seven, will kick off earnings season with Tesla (TSLA) to report third quarter earnings results next week. With speculation forming around the Federal Reserve's future interest rate moves, what does this mean for small-cap (^RUT) stocks? "Regardless of the fact that we have a pretty strong economy right now, Q3 GDP looks like it's going to be above 3%. So that all plays to the small-cap rotation. Basically, in the high interest rate environment, you saw a lot of investors flock to the Mag seven names because they had size and safety," JonesTrading Chief Market Strategist Michael O'Rourke tells Seana Smith and Brad Smith. "But now that we're in this new easing cycle, you're seeing that rally broaden out and it's benefiting both small caps and mid caps," he goes on to say, outlining the core differences between the Russell 2000 and S&P 600 (^SP600). O'Rourke views the Magnificent Seven's overperformance as an opportunity for even the lowest S&P 500 (^GSPC) components to buoy the rest of the index. To watch more expert insights and analysis on the latest market action, check out more Morning Brief here. This post was written by Luke Carberry Mogan.

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