Quantum Measurement
In this edition of the Smart Investor newsletter, we spotlight a global test and measurement leader with expanding roles in AI infrastructure, 6G research, and quantum computing. But first, let’s cover the latest portfolio news and updates.
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Portfolio News and Updates
❖ Visa (V) has adjusted the conversion rates of its Class B-1 and B-2 shares after a $500 million allocation tied to litigation reserves, cutting the as-converted share count effective September 25. The move reduces potential dilution and lifts earnings per share in the same way a stock repurchase would, giving investors a “stealth buyback” despite no shares being bought in the open market. For common shareholders, the adjustment is EPS-supportive and adds incremental value without tapping Visa’s existing buyback program.
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❖ KKR (KKR) experienced a sharp drop last week, triggered by a Bloomberg article casting doubt on future private equity returns, exacerbated by investor jitters over elevated industry valuations. Other alternative asset managers, including Blackstone (BX), also retreated.
Meanwhile, Barclays and Piper Sandler reiterated their “Buy” ratings with price targets implying upside potential of more than 23%. Analysts cited strong operational momentum and growth in digital infrastructure and the 401(k) market.
KKR’s Q2 earnings report showed strong financial performance, beating analyst estimates across several metrics. In addition, the company last week provided a preview of its ongoing quarter, reporting Q3 monetization activity – a revenue subset that includes realized performance and investment income – of over $925 million, up more than 70% from the same period last year. The mix has shifted sharply: in Q3 2024, monetization was 70% realized performance income and 30% realized investment income, compared with 95% and 5%, respectively, this year. Surging performance-related earnings highlight increasingly profitable dealmaking, supported by KKR’s investments in digital infrastructure – which is expected to remain a multi-year growth driver.
KKR is executing a $90 billion global infrastructure strategy centered on digital infrastructure for AI and data centers. Within this plan, it formed a $50 billion joint venture with Energy Capital Partners to invest in AI-driven data infrastructure, including pre-leased data centers already under construction. Most recently, the firm announced a deal to acquire Sempra’s infrastructure arm, which develops and operates energy infrastructure such as LNG facilities and natural gas pipelines – assets critical to powering AI and data centers. Analysts estimate global data center investments will exceed $1 trillion by 2030, with KKR’s pre-leased facilities offering a clear competitive edge.
KKR’s push into 401(k) markets adds another tailwind. Through its April partnership with Capital Group, the firm launched two public-private fixed income funds, with equity-oriented retirement products planned for 2026. The 401(k) market is expanding, with average balances reaching record highs in Q2 2025 – and KKR’s expansion taps into this trend.
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❖ According to media reports, Blackstone (BX) is considering an IPO or sale of Ancestry.com, which it acquired for $4.7 billion in 2020. A sale would provide immediate liquidity, allowing Blackstone a faster exit with certainty regarding its cash proceeds. On the other hand, an IPO could unlock greater long-term value by allowing the market to price the company publicly, potentially at a higher valuation – especially as the IPO market is recovering after a slowdown thanks to the Fed’s interest-rate cuts. Insiders claim that an IPO for Ancestry.com could be valued at $10 billion. Because the discussions are in their early stages and market conditions around IPO pricing and appetite are evolving, Blackstone has not committed to one exit path. Amid broad volatility in shares of alternative managers, the news on unresolved strategic choices triggered investor caution, as selling or spinning off this significant asset could potentially move a needle even for a giant like Blackstone.
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❖ The Pentagon has stepped up its efforts to replenish the U.S. missile stockpiles, calling on producers to “double or even quadruple” the output of missiles, reflecting recent policy and congressional action. RTX (RTX), a major weapon supplier, has been awarded a cost-plus-fixed-fee contract, scheduled to run through 2033, for the Coyote Missile System – covering both fixed and mobile launchers, kinetic and non-kinetic interceptors, and Ku-band radar systems – for the amount of $5.04 billion. The Coyote system is central to counter-drone and missile defense, and the Army continues to emphasize rapid expansion in such programs.
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❖ General Dynamics (GD) has also been awarded two major contracts. The company’s tech unit, General Dynamics Information Technology, or GDIT, has received an $1.5 billion enterprise IT modernization contract to support and strengthen the U.S. Strategic Command’s (STRATCOM) operational readiness. The work involves cutting costs, boosting efficiency, transitioning STRATCOM to a hybrid cloud environment, integrating AI and machine learning into enterprise data for improved decision making, and deploying advanced cybersecurity and zero trust solutions to protect networks. Additionally, General Dynamics was awarded a $642 million Navy contract modification relating to the Virginia-class submarine program. This contract will enhance the company’s efforts in submarine production, reinforcing its position in the defense sector. Meanwhile, TD Cowen has reiterated a positive outlook on General Dynamics citing better-than-expected production and delivery of Gulfstream’s G700 aircraft, reflecting optimism on the aerospace segment.
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❖ Morgan Stanley reiterated its “Buy” rating on Microsoft (MSFT), raising the price target from $582 to $625, and assigned it “Top Pick” status in the category. Analysts said MSFT offers “the clearest and highest probability positive risk/reward” in the large-cap software cohort, citing AI leadership, cloud migration trends, and cybersecurity dominance as growth drivers.
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❖ Meta Platforms and Alphabet (GOOGL) are reportedly in the early stages of talks regarding the usage of Google’s Gemini AI models to improve Meta’s ad targeting. Advertising is Meta’s primary source of revenue, and improving ad targeting is a critical priority for the company. Meta has invested billions into AI research, infrastructure, and proprietary models – and its willingness to explore Gemini for its core ad business suggests Google’s superiority in the sphere. Google is fast becoming an AI “one-stop-shop,” providing everything from hardware to cloud platform to chatbots and leveraging its end-to-end capabilities to extend its ecosystem. Last month, Meta signed a six-year, $10 billion+ deal with Google Cloud to scale its Llama models and generative AI efforts, marking one of Google Cloud’s largest contracts.
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❖ International Business Machines (IBM) saw its stock jump last week after HSBC, one of the world’s top banks, reported a breakthrough in a first in its kind trial on quantum-enabled algorithmic bond trading. Using IBM’s Heron quantum processor, HSBC reported up to a 34% improvement in prediction accuracy for whether a bond trade would be completed at the quoted price compared to traditional methods. This is considered a world-first empirical evidence of the quantum computing’s potential practical benefit in financial services. Separately, IBM is cited as one of the biggest winners in sovereign AI race, slated to receive significant AI-related defense contracts in the U.S. and Europe.
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❖ Uber Technologies (UBER) has significantly upgraded its expected income from non-restaurant deliveries, which are now expected to reach an annual run rate of $12.5 billion in gross bookings by the end of 2025 – up from the $10 billion outlook provided back in May.
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❖ Oracle (ORCL) pared back some of its recent gains last week amid speculation surrounding the TikTok deal and fresh debate over the sustainability of its cloud revenues. The $14 billion price tag approved by President Trump for TikTok’s U.S. operations came in far below earlier estimates, viewed as a win for Oracle, Silver Lake, and other U.S. investors. Still, reports that ByteDance will retain a larger role in the new entity – including a minority stake and profit-sharing tied to the algorithm – suggest that a meaningful slice of future economics could flow back to China, tempering the upside for U.S. partners.
Adding to investor unease, Redburn Atlantic launched coverage of Oracle with a “Sell” rating, arguing that the market is overestimating the profitability of its cloud contracts. In their view, Oracle is functioning more like a financier of AI infrastructure than a high-margin cloud provider. That call stands in contrast to most of the Street, where the majority of analysts remain bullish and continue to raise price targets post-earnings. Bernstein was the latest to weigh in, slightly lifting its target and reiterating a “Buy.” The firm expects Oracle’s heavy investments in AI and cloud to drive faster revenue and operating profit growth over the next several years. While margins are being held down by elevated capex today, analysts project FCF to rebound once spending normalizes. In their view, current AI/cloud outlays are front-loaded costs that set up compounding value creation for shareholders.
Last week, Oracle moved to solidify its financial position with an $18 billion bond offering, upsized from $15 billion after demand swelled to nearly $88 billion. The six-tranche, investment-grade deal – with maturities as far off as 40 years – priced at tighter spreads than expected, underscoring strong institutional confidence in Oracle’s credit strength. The proceeds give the company added balance-sheet flexibility to fund buybacks, dividends, and large-scale cloud and AI expansion.
That expansion is already underway: OpenAI, Oracle, and SoftBank announced five new U.S. data center sites under their Stargate initiative, pushing committed investment above $400 billion and planned capacity to nearly 7 gigawatts. Oracle’s share of the program now exceeds $300 billion, positioning it at the center of the AI infrastructure buildout. For investors, the juxtaposition is clear: while some analysts question the economics of Oracle’s AI cloud contracts, bond markets and project partners are signaling confidence in the company’s ability to deliver on one of the largest technology buildouts in history.
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Portfolio Stocks Under Review
❖ We are keeping Cisco Systems (CSCO) under review due to the stock’s underperformance since mid-August.
Cisco delivered a fiscal Q4 that beat expectations on both revenue and EPS. AI infrastructure orders far exceeded targets, Splunk integration is boosting security offerings, and its legacy networking business posted double-digit growth even as capex declined. Guidance for FY26 shows total revenue growth of ~5% and adjusted EPS growth of ~6%. While headline growth is modest compared to high-growth peers, these results are impressive for a company many had written off just two years ago.
CSCO is actively reinventing itself – moving from a networking incumbent to a key player in enterprise AI infrastructure. Its scale – 35 million devices and 1 billion clients – and unified hardware, software, and cloud stack create a strong foundation for AI workloads. Innovations such as Cisco Data Fabric and Splunk Federated Search for Snowflake highlight its push toward unified AI-ready data architecture. Partnerships with Nvidia, Microsoft, and sovereign AI players like HUMAIN reinforce Cisco’s role in the global AI buildout. These innovations and partnerships could serve as important catalysts for the stock, and have led some industry analysts to declare CSCO a “must-hold stock” in the AI era.
Still, recent stock behavior shows investors remain cautious. CSCO fell nearly 9% in the week following earnings – even as guidance was solid – and, despite a strong rebound, remains below its August peak. Analyst sentiment remains constructive, as the consensus rating is “Buy” and the average price target implies an upside of about 13%. However, some firms want clearer disclosure of AI revenues and warn that much of the upside may already be priced in. Institutional flows remain supportive, while retail positioning is more hesitant.
We are inclined to hold CSCO in the Portfolio, but want to see sentiment catch up to fundamentals – or fundamentals break out further – before removing our magnifying glass.
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Portfolio Earnings and Dividend Calendar
❖ The Q2 2025 earnings season is over, and there are no reports scheduled until BlackRock (BLK) opens the Q3 season for Smart Portfolio companies on October 10.
❖ The ex-dividend date for Cisco Systems (CSCO) is October 3, while for JPMorgan Chase (JPM) it is October 6.
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New Buy: Keysight Technologies (KEYS)
Keysight Technologies is the world’s largest provider of electronic design and test solutions, serving as a critical enabler of innovation across communications, aerospace, automotive, computing, and emerging fields like quantum technology. Its portfolio spans simulation software, signal analysis, network emulation, and full-stack test automation – tools that are embedded in the R&D workflows of leading system and semiconductor companies. Keysight supports the design, validation, and deployment of next-generation technologies such as 5G, 6G, advanced driver-assistance systems, and AI-enabled compute infrastructure. Its PathWave platform helps bridge the gap between design and testing, while its contributions to quantum control systems position it at the frontier of foundational science and commercial viability. With deep technical expertise and operations in over 30 countries, Keysight plays a behind-the-scenes but essential role in building the technologies that define modern engineering.
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Signal to Scale
Keysight Technologies was founded in 2014 as a spin-off from Agilent Technologies, which itself had separated from Hewlett-Packard in 1999. While formally young, Keysight carries forward decades of engineering leadership in electronic measurement – a legacy that began with HP’s original test and instrumentation business. What started as a core part of Silicon Valley’s earliest innovations has since evolved into a global technology platform at the forefront of modern R&D.
Beginning in the early 2020s, Keysight intensified its pivot toward software-centric workflows and next-generation technologies. It accelerated investment in R&D and strategically expanded its reach through a series of targeted acquisitions. In 2020, it acquired Eggplant, a leader in test automation for software applications and user experience, marking a meaningful expansion into software validation. That same year, Keysight entered the quantum field through its collaboration with Quantum Benchmark, later reinforced through investments in scalable quantum control, error diagnostics, and qubit measurement systems.
In 2022, the company acquired SCALABLE Network Technologies, adding digital twin simulation and network modeling capabilities essential for increasingly complex systems in defense and automotive markets. A year later, it purchased Cliosoft, a provider of design data and IP management software that strengthened its footprint in the semiconductor development lifecycle. Most recently, in early 2024, Keysight acquired Ettus Research – a leader in software-defined radio platforms – bolstering its position in advanced wireless prototyping and next-generation defense communications.
Partnerships have been equally transformative. Keysight works closely with hyperscalers like Amazon Web Services and Microsoft, semiconductor leaders, and national research labs to enable cloud-based emulation and AI-enhanced workflows. These collaborations support frontier developments in post-5G, quantum, and secure communications – areas where design and test are tightly intertwined.
The company also plays a key role in U.S. government-led technology programs. Keysight contributes to Department of Defense initiatives focused on secure communications, spectrum superiority, and advanced signal intelligence – areas where its expertise in signal generation, network emulation, and RF testing is critical. It supports next-generation programs involving radar, electronic warfare, and AI-integrated defense systems. In parallel, Keysight helps shape global technical standards through active participation in bodies such as 3GPP, IEEE, and the Open RAN Alliance. These efforts directly influence how protocols for 5G, 6G, and open network architectures are defined and validated, reinforcing its role as both a solutions provider and a technical authority across commercial and mission-critical domains.
What began as a precision instrument business has become a foundational partner to some of the most demanding R&D organizations in the world. Through targeted acquisitions, deep partnerships, and sustained investment, Keysight has built a position of strategic relevance across both established and emerging technology domains.
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Scope and Scale
Keysight Technologies operates through two primary segments: the Communications Solutions Group (CSG) and the Electronic Industrial Solutions Group (EISG). CSG accounts for about 70% of revenue, split between the larger commercial communications subsegment and the smaller, but strategically important aerospace, defense, and government market. EISG makes up the remaining 30%, focused on semiconductors, general electronics, and automotive customers where testing accuracy and speed are critical to competitiveness.
CSG is the company’s most dynamic growth engine. Demand from hyperscalers, chipmakers, and network equipment providers has surged as AI-scale data centers and high-speed interconnects expand globally. Digital twin simulation has become a core part of Keysight’s offering, allowing customers to replicate and test complex networks, defense systems, and semiconductor environments virtually before deployment. KEYS’s measurement and validation tools are also deeply embedded in the AI hardware value chain, supporting accelerator, processor, and memory performance in systems designed for training and inference. This line of business has already become a meaningful contributor and is expanding faster than the company overall.
Policy tailwinds are reinforcing these trends. Initiatives such as the CHIPS Act, semiconductor reshoring programs, and the July OBBB fiscal package – which restored full R&D expensing and bonus depreciation – are lowering capital costs for customers building AI-ready infrastructure. Defense budgets and secure communications programs further underpin demand, with Keysight supplying projects focused on electronic warfare, spectrum dominance, and secure connectivity.
EISG is positioned for durable growth through two vectors. Semiconductor testing, which makes up about half of the segment, continues to expand with the rollout of AI-optimized processors and advanced memory architectures. Automotive electronics, while still under 10% of companywide sales, is steadily increasing as vehicles adopt electrification, connectivity, and advanced driver-assistance systems. Keysight supports this transition with platforms for battery management, power electronics, and radar validation, embedding itself in long-term industry shifts toward EVs and autonomy.
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Quantum Leap-Ready
Beyond its established markets, Keysight is investing early in frontier technologies not yet material to revenue but critical for long-term positioning. The company is advancing 6G, the expected successor to today’s 5G networks. While commercial deployment remains years away, 6G research is already under way, centered on applications such as holographic communications, ultra-low latency machine control, and pervasive AI integration at the network edge. Keysight provides the emulation and measurement platforms that universities, national labs, and telecom leaders are using to shape the technical standards, giving it a head start in a market projected to redefine connectivity in the 2030s.
Quantum represents another early bet with significant potential. KEYS’s quantum control systems (QCS) have already been deployed in Japan and Europe, including the world’s largest commercial installation supporting more than 1,000 superconducting qubits at AIST, as well as the 256-qubit system developed by Fujitsu and RIKEN. Keysight’s QCS acts as a bridge between classical computing commands and quantum processors, enabling scaling to larger qubit counts with high performance. The company has also partnered with European quantum provider IQM to deliver on-premises high-performance solutions, and expanded its portfolio by acquiring Quantum Benchmark, which specializes in qubit quality and error diagnostics. These early investments ensure Keysight is not simply prepared for quantum’s commercialization but ahead of the curve, ready to translate leadership in control systems into market share as the field matures.
Further momentum comes from the FY2027 federal R&D priorities issued by the Office of Management and Budget and the Office of Science and Technology Policy, which direct agencies to channel more funding into critical and emerging technologies. For quantum, the focus is on test facilities, shared infrastructure, and advanced device manufacturing – areas where Keysight’s platforms are directly relevant. For AI, priorities include new chip architectures, safeguards against manipulation, and tools to improve reliability and transparency, all aligning with Keysight’s validation and testing solutions. By embedding itself in these ecosystems, KEYS is positioned to capture incremental demand as agencies and their research partners scale up spending.
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Controlled and Calibrated
Keysight Technologies posted a strong third quarter of fiscal 2025, with revenue up 11% year-over-year to $1.4 billion and earnings per share of $1.72, both surpassing the high end of guidance and analyst consensus expectations. Orders grew 7% across both major segments, supported by AI-driven demand, aerospace and defense strength, and general electronics. Segment contributions were balanced, with the Communications Solutions Group generating $940 million (up 11% year-over-year) and the Electronic Industrial Solutions Group delivering $412 million (up 11%).
Profitability remained solid, with gross margin steady at 64% and operating margin improving 60 basis points to 25%. Free cash flow reached $291 million in the quarter, bringing year-to-date generation to $1.1 billion. Analysts had anticipated EPS of about $1.68 and revenue of $1.39 billion, so the company exceeded expectations on both counts.
AI has become a material growth contributor, with AI-enhanced solutions accounting for roughly 6% of fiscal 2024 revenue and expanding faster than the company overall. Within CSG, orders tied to hyperscale data centers, optical networking, and emulation platforms grew at double-digit rates during fiscal 2025. Keysight also introduced industry-first solutions such as a protocol layer validation system for 1.6-terabit performance and expanded partnerships, including joint work with AMD on early PCIe Gen 6 compliance. Wireless and automotive markets, by contrast, showed stability but lagged the faster growth seen in AI-related, aerospace, and defense segments.
The earnings beat was tempered by tariff headwinds. New U.S. reciprocal tariffs introduced in August are expected to increase annualized costs by about $75 million, raising Keysight’s total tariff exposure to $150-175 million per year. Management has laid out countermeasures including supply chain optimization and pricing adjustments, with full mitigation expected by the second quarter of fiscal 2026.
Despite these incremental costs, Keysight raised its full-year guidance. Management now projects revenue growth of ~7% year-over-year (up from ~6% previously) and adjusted EPS growth of ~13% year-over-year (versus 10%+ prior). Fiscal fourth-quarter guidance calls for revenue of $1.37-1.39 billion and EPS of $1.79-1.85, both above consensus expectations of about $1.36 billion and $1.77, respectively. The stronger outlook reflects continued momentum in AI, aerospace and defense, and general electronics, partially offsetting near-term softness in wireless and automotive.
Keysight is also advancing its portfolio mix toward software and services, where margins are structurally higher and revenues more recurring. Pending acquisitions – Spirent Communications, Synopsys’ Optical Solutions Group, and ANSYS’ PowerArtist – are set to expand Keysight’s reach in simulation, network validation, and power optimization. Together, these moves are expected to reinforce top-line growth while improving margin resilience through a greater share of software-driven recurring revenue.
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In Good Measure
Keysight’s peer set brings together a focused group of U.S.-based technology and instrumentation companies – including automated test leader Teradyne, diversified industrial technology group Fortive, precision instrumentation specialist AMETEK, and aerospace and defense electronics provider Teledyne Technologies. Each has its own mix of markets and technologies, but all operate at a comparable scale with exposure to secular demand in semiconductors, advanced electronics, and defense.
Keysight differentiates itself through diversification – spanning commercial communications, aerospace and defense, and industrial electronics – as well as early bets in AI hardware validation and quantum control systems. While this broad mix gives it exposure to multiple long-term growth vectors, it also ties short-term performance to different end-market cycles. That helps explain why KEYS, with a gain of about 8% year-to-date, has underperformed Teledyne – which is heavily exposed to surging demand for defense technologies – while outperforming peers with greater reliance on industrial, healthcare, or communications markets.
Despite a solid 8% gain year-to-date, KEYS has lagged the S&P 500, leaving its performance comparatively subdued. Even so, Wall Street remains constructive, forecasting meaningful upside as analysts continue to lift their targets on the “Strong Buy” rated stock. The latest dose of optimism came from JPMorgan, which raised its price target from $168 to $200, citing strong execution, resilient financials, and strategic positioning to capture secular demand from next-generation technologies.
KEYS is trading at a moderate valuation relative to peers. On trailing metrics, the stock sits at or slightly below the group average for non-GAAP P/E, EV/Sales, and Price/Sales, while running a bit higher on EV/EBITDA. On forward estimates, however, Keysight’s non-GAAP P/E, EV/Sales, and EV/EBITDA multiples – as well as its Price/Cash Flow – are all meaningfully below the peer mean, underscoring an attractive entry point.
The company’s capital allocation framework emphasizes reinvestment in R&D, acquisitions, and share repurchases. In August 2023, the board approved a $1.5 billion buyback authorization, of which $1.29 billion was used through August 2025. This program has reduced the share count by roughly 5.1% over the past two years, contributing to a cumulative net reduction of more than 7.5% across the last five years.
Taken together, Keysight’s moderate valuation, consistent buyback activity, and diversified exposure to multiple secular growth markets give investors a clear view of both resilience and upside potential, even as near-term performance reflects the mix of cycles it serves.
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Investing Takeaway
Keysight Technologies offers investors a combination of structural growth drivers, disciplined execution, and balanced capital allocation. The company has evolved from a traditional test equipment provider into a diversified platform serving communications, semiconductors, aerospace, defense, and industrial electronics. Its early positioning in AI infrastructure, 6G research, and quantum control systems provides exposure to emerging technologies with long runways for expansion, while its established segments deliver steady demand and recurring revenue opportunities. Keysight pairs this forward-looking portfolio with a consistent reinvestment strategy and active share repurchases, reinforcing both competitiveness and shareholder returns. The result is a business aligned with enduring technology and policy tailwinds, trading at a moderate valuation relative to peers. For investors seeking durable growth with measured risk, Keysight presents a strong long-term case.
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New Sell: MACOM Technology Solutions (MTSI)
We are selling MACOM Technology Solutions from the Portfolio after a sustained period of underperformance that has persisted even as broader technology peers have rallied. The company’s fundamentals remain intact, but the lack of near-term catalysts, muted investor sentiment, and disappointing stock behavior make reallocating capital the more prudent step.
MTSI entered our portfolio with strong credentials: a U.S.-based RF fab, exposure to AI infrastructure buildout, and leadership in interconnect technologies critical to data centers, defense, and telecom. Fiscal Q3 2025 results delivered revenue and earnings above expectations, and Q4 guidance also came in ahead of consensus. Analysts have been broadly supportive, with major firms – including JPMorgan, BofA, and Evercore – raising price targets and highlighting MACOM as a top AI connectivity play. The company is entering two important product cycles, Active Copper Cables (ACC) and Long Path Optics (LPO), and continues to win visibility at industry events such as EuMW and ECOC conferences.
Yet the stock has failed to reflect these positives. Since earnings, shares have lagged both the S&P 500 and semiconductor peers, suggesting entrenched negativity among investors. Even after its rebound from post-earnings lows, MTSI trades below August levels, unable to capture momentum that has lifted others in its peer group. With news flow sparse and analyst coverage moderate, the stock has little to fuel a rerating until the next quarterly report on November 6 – still five weeks away.
Company guidance for the quarter projects EPS between $0.91 and $0.95, straddling consensus at $0.93. MACOM’s history of delivering results largely in line with expectations or slightly above them reduces the odds of a strong upside surprise. In other words, investors are unlikely to find a reason to revisit the name in the immediate term. While the fundamentals remain solid and the long-term story of AI-driven demand and reshoring is intact, the absence of near-term triggers leaves MTSI exposed to continued underperformance.
This exit is not about MACOM’s business, which remains strategically well positioned, diversified, and financially sound. It is about the mismatch between fundamentals and stock behavior. The company is executing, but investors have yet to buy into the story, and sentiment remains tepid despite strong analyst endorsements. In the current environment, waiting passively for sentiment to shift ties up capital in an underperforming position when stronger opportunities exist elsewhere.
We will revisit MACOM if new catalysts emerge – whether in the form of policy shifts like the proposed 1:1 domestic manufacturing rule, meaningful customer wins in AI interconnects, or a sharp change in investor sentiment. For now, however, stepping aside allows us to preserve flexibility and reallocate into names with more immediate drivers.
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Smart Investor’s Winners Club
The 30% Winners Club represents stocks from the Smart Investor Portfolio that have risen at least 30% since their purchase dates.
Markets have been volatile, but most of the Portfolio stocks have performed well – and the Club’s ranks have expanded to 17 stocks: GE, AVGO, ANET, ORCL, EME, HWM, TSM, APH, IBKR, PH, CRWD, GOOGL, VRT, MTZ, UBER, IBM, and BK.
The first contender for the Club’s entry is now RTX, with a 29.60% gain since purchase, closely followed by JPM, with a 28.95% increase. Will one of them earn the rite of passage, or will another stock outrun them to the finish line?
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