To The Moon

Growth versus value has long been a key debate in the investing community. And the latest developments at Palantir and SMCI have made them a fitting pair for such comparison. Although both stocks were once viewed jointly as key AI beneficiaries, they've since diverged in their paths. On one hand, Palantir's soaring to all-time highs with an eyewatering valuation of almost 50x NTM sales, backed by AI-driven acceleration to its growth trajectory. Meanwhile, on the other hand, whether SMCI's fall from grace can be reverted remains a substantial uncertainty, given ongoing accounting woes and their implications. The following analysis will discuss the context of both stock's performance this year, and provide a deep dive into their growth and value implications ahead. hapabapa There’s long been

XPeng Inc.'s eye-watering rally since August was dampened after the company reported a tempered sales outlook for Q4 this week. Despite optimism for accelerating volume growth, the comparatively softer strength in XPeng's revenue prospects highlights imminent ASP pressures. Looking ahead, the introduction of four new models next year, alongside the implementation of an EREV strategy, is likely to reduce visibility on its longer-term fundamental trajectory. The related execution risks remain underappreciated at current levels, and will likely diminish the durability of XPEV's valuation premium over its comparable Chinese EV peers in the near-term. hapabapa/iStock Editorial via Getty Images XPeng Inc. (NYSE:XPEV) has been one of the best-per

Following an eye-watering rally earlier this year, the SMCI stock has now flipped to YTD declines as it faces continued implications of ongoing accounting woes. In the latest turn of events, SMCI's auditor, Ernst & Young, has resigned from the engagement. This casts further uncertainties on when investors can expect SMCI's delayed 10-K filing. In the meantime, SMCI bulls continue to believe that the company's accounting problems and delayed 10-K filing are isolated issues from its technological advantage in capturing AI opportunities. However, SMCI's delayed 10-K filing alone (even if without material misstatements) has adverse cascading effects on its operations, which are fast approaching yet remain underappreciated by the market at current levels. JHVEPhoto The Super Micro Computer

Summary Much of Broadcom Inc.'s rally this year has been buoyed by market confidence in its competitive advantage in custom ASICs and networking solutions, which are critical in AI infrastructure. But the stock's post-earnings pullback reflects concerns pertaining to the uncertain recovery timeline for Broadcom's non-AI segments, which still account for the bulk of its business. The infrastructure software segment also faces impending risks of maturation, which limits margin expansion and cash flow improvement needed to address the elevated debt exposure acquired from VMware. This leaves little durability to the stock's current valuation. JHVEPhoto Broadcom Inc.’s (NASDAQ:AVGO) selloff in response to its lighter-than-expected

Summary Advanced Micro Devices, Inc. has been consistently furthering its consolidation strategy in an aim to better compete against end-to-end AI solutions provided by industry leader and key competitor Nvidia. This is expected to complement ongoing efforts in extending its AI market share gains by bolstering uptake of its core data center hardware offerings, particularly its latest Instinct MI300 accelerators. The additive growth outlook will also underpin sustained margin expansion as new products, especially within the more profitable data center segment, continue to scale. JHVEPhoto Catching up to rival Nvidia’s (NVDA) AI prowess has long been a milestone in the works for Advanced Micro Devices, Inc. (NASDAQ:

Summary As discussed in our previous coverage, the start of productions and shipments of SMCI's proprietary DLC solution is a key catalyst for the stock. Margin compression risks remain a key overhang on SMCI's valuation outlook, but the continued ramp of DLC shipments will offer sustained compensation through competitive unit economics and economies of scale. Management's latest target DLC penetration rate of 25% to 30% of new global data center deployments over the next 12 months is also a material jump from previous expectations. This is a game changer for SMCI, with ensuing fundamental benefits to profitability and cash flows still underappreciated at the stock's current price. JHVEPhoto In our

Summary Google continues to be well-positioned in the AI play, with robust Q2 results in its core Search advertising business and persistent momentum in Cloud monetization. The latest earnings outperformance continues to assuage previous concerns about AI-driven cannibalization of Google's search dominance, and reinforces its reputation in actively monetizing the nascent technology. However, the stock's post-earnings response continues to highlight the increasing disparity between Google's fundamental outlook and its valuation premium at current levels. 400tmax Google (NASDAQ:GOOG/NASDAQ:GOOGL) has been one of the biggest gainers this year, alongside digital advertising peer Meta Platform

Summary Verizon's Q2 revenue miss has wiped out its ~8% YTD gains all at once, taking the stock's choppy performance this year back to square one. Yet the company has continued to deliver favourable progress on its three pillars - namely, wireless service revenue growth, adjusted EBITDA expansion, and FCF growth. Postpaid wireless net adds have also returned to the positive side, with increasing adoption of its premium myPlan and myHome offerings coupled with comparatively limited churn. Taken together, we view the stock's latest pullback as the final boarding call for close-to-7% dividend yield, as Verizon's fundamentals are poised for better days in 2H24 alongside greater valuation correlation to rising Treasuries amid impending rate cuts. hapabapa Verizon Communications Inc.'s (NYSE:

Summary Taiwan Semiconductor Manufacturing Company Limited's Q2 beat and raise continues to solidify its path towards a $1 trillion market cap. The robust results and upbeat outlook corroborate sustained demand for HPC hardware given ongoing AI momentum, complemented by a stronger-than-expected cyclical recovery in consumer devices. This continues to highlight the competitive value in Taiwan Semiconductor's technology advantage, given its sole capability in producing at the most advanced nodes and packaging processes critical to high-growth innovations like AI. BING-JHEN HONG Taiwan Semiconductor Manufacturing Company Limited aka TSMC (NYSE:TSM) stock is likely on course towards a sustained $1 trillion market cap, as the underlying business

Summary SMCI has been a clear winner in the market's ongoing AI rally, despite recently paring some of its gains on mixed earnings results. Yet the stock has been showing signs of a sustained recovery in recent weeks, underpinned by a successful Computex keynote that shows SMCI's mission-critical role in AI developments remains intact. SMCI also benefits from tangible fundamental tailwinds ahead, with improving supplies, additive growth from its first mover advantage in the provision of DLC solutions at scale, and increasing operating leverage. Trading at 2.5x estimated sales and 28.5x estimated earnings, SMCI's fundamental strength and emerging DLC advantage remain underappreciated, with potential for further upside. JHVEPhoto Since recognizing Super Micro Computer, Inc. (NASDAQ: