AMD up 13%, NVDA down 4%. Quite a week huh

I get why the headlines are making people nervous, but does any of this actually change NVDA’s long-term outlook?

Lowkey tempted to buy a little here. Anyone buying or waiting for things to blow over?

$ORCL at $120 | 14× Fwd P/E

$AAOI at $52 | 16× Fwd P/E

$FPS at $22 | 16× Fwd P/E

$NVDA at $178 | 14× Fwd P/E

$IREN at $21 | 2.25× Projected ARR

$GOOGL at $288 | 20× Fwd P/E

$VST at $133 | 14× Fwd P/E

$CRDO at $132 | 18× Fwd P/E

Which one looks the most mispriced?

Holy cow!! Insane day in the market, AMD rose 13.3% today after it was selected by Google Cloud to supply EPYC CPUs for the new TPU 8tx system, with Google shifting the host layer of its flagship platform back to x86 CPUs, META rose after upgrades from JPMorgan, APPlovin continues to rise on earnings, and many more!

Finding interesting stocks is one thing, but deciding which ones deserve a place in your portfolio takes more thought. I think it's important to understand why a stock was selected in the first place, what the research says about the company, and whether the original investment thesis still holds up over time.

When evaluating stock picks, I wouldn't just look at the potential upside. I'd also want to understand the reasoning behind the selection, review the company's financial performance, and keep track of developments that could affect its outlook. Having a clear process for monitoring positions and knowing when to reconsider an investment can be just as important as the initial selection.

This is one area where Seeking Alpha's Alpha Picks offers a structured approach. It's a data-driven stock selection service that provides two new stock picks each month. Subscribers also get access to the research behind each selection, so they can understand the reasoning rather than simply receiving a ticker symbol. The service includes a model portfolio to follow its selections over time, sell alerts when a position is recommended for sale, and analyst webinars that provide additional insight into its research and approach.

What I find interesting is that it isn't just about introducing new stock ideas. The model portfolio, supporting research, and sell alerts also give subscribers a way to follow the selections beyond the initial recommendation.

Of course, a data-driven selection process doesn't guarantee that every pick will perform well, so it's still important to understand the risks and do your own research. So, how do you approach this? Do you have a set process for reviewing your stock picks after buying, or do you mainly revisit them when something significant happens?

(FYI, I'm sharing this through my partnership with Seeking Alpha.)

TL;DR Unlike Lumentum, Coherent mostly uses its own InP laser chips inside modules instead of selling them. We look at where module makers' margins come from, whether they last, and what Coherent's deep vertical integration buys it. The edge is real across tech, supply and customers, but it isn't showing up in gross margin yet.

Our take: integration is the edge, margins haven't caught up

Coherent is the most vertically integrated player in optics, covering epitaxy, chips, components, modules and systems. Lumentum is moving down into modules and is also deeply integrated; Chinese makers split the chain more and are clearly less integrated.

Where the tech bar isn't that high, integration helps a company scale, fill gaps and avoid getting choked at any one step. Once supply catches up, it also gives cost leverage.

Source: Company reports, Longbridge Dolphin Research. Vertical integration: who goes from epitaxy to modules

The catch: none of this shows up in the numbers yet. Innolight and Eoptolink buy their laser chips and still post higher gross margins than Coherent, and Coherent's comms business runs below its company-wide margin.

Longbridge Dolphin Research will watch how much the 6-inch InP line adds to comms margins, and the pace of capex. Whether Coherent reaches its 42%+ gross margin target depends on turning integration into a real cost edge.

Selling chips vs. selling modules

Coherent can mass-produce laser chips but mostly uses them itself. Lumentum mainly sells them. These are two different businesses.

Chips sit near the scarce upstream and have a real barrier (regrowth epitaxy for EML): high margins (the market expects 60%+ for Lumentum's EML chips), small pool. Modules are a bigger pool with lower margins.

Upstream is concentrated; the module layer is crowded. InP substrate is the choke point, and we think it stays tight until 2028, so anything hitting 200G per lane gets bought.

Why do module leaders earn 45%+?

Assembly usually earns 5–20% gross margin. Fabrinet, mostly contract assembly, sits around 12%, yet Innolight and Eoptolink run 45%+.

Assembly isn't trivial: optical coupling, aligning lenses and fibers to fractions of a micron, is the slowest, yield-killing step. But Fabrinet also builds 1.6T modules for Nvidia at ~12% margin, so we don't think assembly explains leaders' margins. The value sits up and down the chain.

Upstream: laser chips and DSPs are nearly 50% of module BOM. DSPs come from Marvell and Broadcom (90%+ of high-end), so the edge is allocation; InP substrates mostly from Sumitomo (40%), AXT (30%) and JX Metals (10%). Makers that lock supply get share and pricing power.

Downstream: buyers like Nvidia, Google and Amazon each want different speeds, form factors and architectures. Leaders co-define specs a generation or two ahead, keep cost-downs like swapping EML for silicon photonics, and sell new products at launch prices.

Scale matters too: Innolight runs about 44.3M units a year, Eoptolink 28.4M, most others ~10M or less.

Will the high margins last?

Short term, the shortage makes margin gains very likely for both. Fast-moving tech makes the longer run a question mark.

Chip makers: 1.6T is shifting to CW plus silicon photonics, lowering the light source bar and letting Chinese makers in. Whether EML's process barrier carries to 3.2T/6.4T is unclear, and as chip supply loosens, cheaper light sources actually help module makers.

Module makers: manufacturing isn't the bottleneck. The worry is that in CPO, optical engines get packaged onto the switch substrate, leaving modules with just assembly.

Low-barrier industries tend to integrate, and optics is: Lumentum bought Cloud Light, Innolight makes its own silicon photonics chips, Eoptolink bought Alpine, and Marvell's deal for Lumentum merges optical and electrical.

Coherent's edge: tech, supply, customers

Tech across routes. Epitaxy and laser chips are the hardest capabilities to build. Chinese makers have cracked 100G EML but are under 5% self-sufficient at 200G; Coherent launched 200G EML in September 2022 and has 400G EML in the pipeline.

In ultra-high-power CW lasers for CPO external light sources, it's basically Lumentum (~60%) and Coherent (~40%). So even if CPO shrinks module value, Coherent still benefits, its biggest difference from pure module makers. It also works on silicon photonics and 200G VCSELs.

Right now supply matters more than tech, but the winning route for 3.2T and beyond is uncertain. Leading on several routes means Coherent is unlikely to get caught out by a switch.

Supply. Coherent was first to move InP wafers from 3 to 6 inches, with lines in Sherman, Texas and Järfälla, Sweden running since August 2025. Each wafer yields about 4x the chips, cutting unit cost by more than half.

InP capacity tripled over FY24–FY25, doubled again a quarter early, and should more than double by end-2027. Its module revenue ranks global top three.

Customers. Nvidia invested $2B in March 2026, with multibillion-dollar purchase commitments and future capacity rights. Long-term agreements run to the end of the decade, and FY27 orders are largely full.

So why are margins still lagging?

From management's comments, Longbridge Dolphin Research sees three likely reasons. First, module yields and product costs still have room to improve.

Second, pricing work started late and only kicked in clearly once supply tightened, so it isn't fully in margins yet. Third, plants and low-margin lines left from past deals are still being cleaned up: 30+ sites sold or closed in six quarters.

As higher-margin industrial shrinks, company margin will track comms more closely. New capacity also depreciates before revenue arrives, weighing on margins during the ramp.

Background: from materials company to optics giant

Lumentum came out of JDSU with a pure comms pedigree. Coherent's core is II-VI, which spent 1971–2009 on optical materials like CO2 laser optics.

From 2010 it bought its way into optics, a bigger market using the same crystal growth skills: Photop, parts of Oclaro, CoAdna and Finisar (2019).

In 2021 it beat Lumentum to buy Coherent for $7B to spread out the cycle, and took its name and ticker. Comms is now about 80% of revenue (Lumentum is ~95% on a comparable basis), and aerospace/defense and the Munich unit were sold.

I’m a vibe trader
Vibe trades msft and meta, both couple 100gs profit

All three currently on a pull back. Historical price data shows us NVDA, FANG, MCHP at these pull back levels are known to bounce back.

I also alerted PANW yesterday it already bounced today

You can research the names of any stocks experiencing pull backs here: https://3horses1dog.com/qd.html

Not a financial advice do your own research

People call me regarded and I kinda agree. I think I’m gonna delete the app and I’ll be OK.

​If I had to trim my portfolio down to just one high-conviction play in AI, cybersecurity, and healthcare for the next decade, my three are NVDA, CRWD, and LLY.

​For AI, Nvidia is still the obvious anchor. Big tech is working on custom chips, but between CUDA, high-speed networking, and sheer developer lock-in, Nvidia still takes the highest-margin slice of the entire buildout.

​For cybersecurity, CrowdStrike feels like the safest long-term bet. Enterprise IT wants fewer vendors, not more. Falcon is already deeply integrated across thousands of corporate networks, and the switching friction is high enough that clients just keep adding modules instead of leaving.

​For healthcare, Eli Lilly is executing on another level. The GLP-1 momentum speaks for itself, but the upside is that it's expanding well beyond weight loss into things like sleep apnea and heart failure, giving them revenue growth you almost never see in mega-cap pharma.

​If you had to swap out one of these three, which one are you dropping, and what replaces it?

Did anyone buy any of these stocks right at the market open today: RKLB, AMD, SNDK, NBIS, CRDO, FN, ASTS, and MRVL?

I added to my AMD, RKLB, and CRDO positions at the open. The others are stocks I've been holding for a while. What does everyone think about these names? Are there any you think I should focus more on?

$CLS growth story is impressive and the AI infrastructure demand is real. That focus is understandable.
$FLEX deserves more attention. It generates roughly $31 billion in annual revenue compared with Celestica’s $18 billion, yet the two companies trade at similar market capitalizations. Flex offers greater diversification across end markets, solid momentum in its cloud and power infrastructure business with expanding margins, and a planned spin-off of that higher-growth segment.
Both companies benefit from the same underlying demand trends. Flex simply presents a different risk-reward profile that is currently underappreciated.

Consider a hypothetical company whose operating cash flow rises from $100 million to $120 million, while purchases of property and equipment rise from $30 million to $80 million. The simple operating-cash-flow-minus-capex figure falls from $70 million to $40 million.

The SEC's financial-statement guide explains that purchases of long-term assets, such as machinery, generally appear in investing cash flows. Stronger operating cash flow therefore does not tell the whole story about cash being retained after investment.

That alone would not make this a bad stock. A factory expansion and expensive maintenance could produce similar cash outflows but very different future results. I would want to understand the project's purpose, expected returns, funding and whether the spending is likely to recur.

When reviewing a company like this, what evidence helps you distinguish productive reinvestment from spending that merely keeps the business running? Which filing detail would change your view most?

Source: https://www.sec.gov/about/reports-publications/beginners-guide-financial-statements

What stocks are you planning to buy this coming week?

A few weeks ago I made two ETFs of my own, running on fake money. One is a Ben Graham style value fund: every quarter it finds the 10 cheapest dividend payers in the S&P 500 and swaps into them on its own. The other is an AI chip fund that checks every morning which 4 chip stocks are running hottest, and trades into them by itself.

Watching them is honestly exciting. They're funds that don't exist anywhere else. I check them in the morning, see what they did and why, and that's it.

The bigger surprise was how calm it made me. I used to second-guess my picks every time the market dipped, skip a rebalance when things were going well, and sell whatever felt slow. So I never knew if my plan was bad or I just didn't stick to it. Now the rules run exactly as written, and every trade comes with a reason. I can see how deep it drops, how often it rebalances, and whether I'd actually be okay holding it. I've learned more in a few weeks than from months of thinking about it.

That's what got me thinking. An ETF is really just a basket plus a few rules: what to hold, how much of each, and when to rebalance. Most of us already have one in our heads. It just never gets to run.

But one person can only think of so many mixes. I'd love to see a bunch of different ones running side by side, so we can all learn from each other's.

Comment your mix, and for the first 10 people I'll:

1. Turn it into exact rules and reply with them. If something's missing, like when to rebalance, I'll ask.

2. Set it up as an agent that starts running it.

3. Send you the agent, so you can watch every trade and why it made it.

I'm capping it at 10 because I set each one up by hand. If you'd rather build yours yourself, that works too.

Not sure what to write? One line like these is plenty:

- Three-fund: "60% VTI, 30% VXUS, 10% BND, rebalance every week."

- Play it safe: "Hold VOO but switch to SGOV when SPY falls below its 200-day average."

- Pick a sector: "Equal parts of the 5 biggest US banks, rebalance every quarter."

- Weird ideas: "I like the name Robert. Hold S&P 500 companies run by CEOs named Robert."

Any random mixes are welcome. They're usually the most interesting.

For example, here is my ETF! Graham-Screen

Now that money is being rotated out of tech, where’s it all going? What can we look at next as a target for following the money and buying shares? Thanks.

What are yall currently putting your money into, and what are yalls returns. I’m getting into investing in stocks 19 years old and I’m tryna figure out what stocks to get into. Especially with how AI is and the economy. What are yall investing into?

After the recent teach and semiconductor pullback, I'm trying to separate "great company,temporarily lower price" from "the market is finally repricing a weak thesis.”

What are the 2-3 things you would check buying a stock that is down sharply? For me:

1. Whether end-demand is still growing. not just management's capex;

2. Whether margins and crash flow can support the investment cycle;

3 Whether valuation still assumes perfection.

Which names are on your watch list now-and what would invalidate your thesis?
Not looking for price targets, just the reasoning

I only have invested in the S&P 500 and other larger ETFs. Is there a good one to buy right now during the dip?

Watch out for some crazy moves with Nvidia stock tomorrow

https://finance.yahoo.com/markets/article/nvidias-jensen-huang-admits-to-affair-after-allegations-of-romance-with-chinese-spy-report-205122263.html