Chit Chat Stocks - 2026 Stock Market Predictions

Episode Date: December 31, 2025

On this episode of Chit Chat Stocks, we take a look back at our 2025 returns, we analyze last year's market predictions, and we make 6 new bold predictions for 2026. These include our takes on the overall economy, big tech, and stocks/sectors that we think could outperform or underperform. We discuss: (00:00) Introduction (11:55) Analyzing Our 2025 Investment Returns, including biggest winners and biggest losers (17:51) Reviewing last year's market predictions (30:12) Bold stock market predictions for 2026 (53:06) Investment Goals for 2026 ***************************************************** Sign up for our stock research service, Emerging Moats: ⁠emergingmoats.com⁠  ********************************************************************* Chit Chat Stocks is presented by Interactive Brokers. Get professional pricing, global access, and premier technology with the best brokerage for investors today:  ⁠https://www.interactivebrokers.com/⁠  Interactive Brokers is a member of SIPC.  ********************************************************************* Fiscal.ai is building the future of financial data. With custom charts, AI-generated research reports, and endless analytical tools, you can get up to speed on any stock around the globe. All for a reasonable price.  Use our LINK and get 15% off any premium plan: ⁠⁠https://fiscal.ai/chitchat⁠  ********************************************************************* Disclosure: Chit Chat Stocks hosts and guests are not financial advisors, and nothing they say on this show is formal advice or a recommendation. Learn more about your ad choices. Visit megaphone.fm/adchoices

Welcome to Chit Chat Stocks. On this show, hosts Ryan Henderson and Brett Schaefer analyze businesses and riff on the world of investing. As a quick reminder, Chit Chat Stocks is a CCM Media Group podcast. Anything discussed on Chit Chat Stocks by Ryan, Brett, or any other podcast guest is not formal advice or recommendation. Now, please enjoy this episode. welcome in you are listening to the chit chat stocks podcast a podcast to help you find your next great investment my name is brett schaefer joined as always by ryan henderson we are doing our annual 2026 predictions episode 2025 review episode going to look at some of our thoughts for 2025 how they worked out what we're thinking about the markets in 2026 and look at some of our

portfolio, what worked, what didn't, biggest losers, biggest winners, biggest percent gainers, biggest percent losers. Winners will be a bit more fun than the losers, but we got a mix of both as always. As a note, we're recording this on December 23rd. I think this is a good time of year to say thank you to all the listeners. I know we have some that join us on a regular basis. It was nice to see that Spotify wrapped. And remember, we are not investing based on any of these predictions. These are just a fun exercise, bragging rights. We get them right a little bit of a tail between our legs and we get them wrong. We typically invest in a longer time horizon, at least a three to five year time horizon.

We're not very active traders, try to buy and hold. And the last thing I'll say before I turn it over to Ryan, please, if you've listened to the show even just once or many, many times throughout the year, the best way to give back to this podcast which is completely free is to give us a review on apple podcast or spotify just head on over take you five seconds click that five star button and you'll be on your way okay ryan we're gonna go portfolio review maybe i'll let you go first since your and we'll use money weighted return for all the numbers here a little bit better than mine in 2025 how was your portfolio what was your biggest winners what is the retrospective looking like as we sit here

on december 23rd 2025 yeah let me just say that this episode is always a good opportunity it's like a good vibe check on where kind of kind of where i feel the economy's at like it's sort of a heat check because a lot of the predictions the annual predictions some of them typically have something to do with the world's biggest companies or the indices or the market broadly. And it was kind of fun looking back a year ago versus where we are at now. And I've kind of basically flipped one of my biggest predictions, but going through 2025, 2025 was a good year for me. My money weighted return was 24.7% so far. So good year outpaced the S&P 500. And I was partly bailed out. But as of this recording, one of my biggest losers last year was Harbor Diversified. It's the small cap, very illiquid. We've talked about them on the show before, but they recently announced that they're liquidating a portion of their airplane fleet along with their business in general.

And the stock has gone up a bunch. So it's sort of a buoy for my portfolio at the moment. But looking back on the year, the best decision that I made by far was buying Google and making it a large position that was basically doubled from my cost basis over the year, which since it was this, I think this is kind of a lesson for me, which is have a list of companies that you deem really high quality and when they get into that sort of strike zone and for me when looking at big tech that's generally like if it's mid-teens forward ebit ebit multiple you're probably going to do fairly well with i'm kind of thinking about like amazon amazon google apple historically i guess each company is a little different but generally big tech you get and again depends on what company

you're looking at but a lot of the times they have traded at 30 to 40 times earnings and the few times they fall down to that 15 times range it's typically then a good time to buy you can't just use that for any company and go oh it's an automatic buy

you got to do your own analysis you got to see what's happening you have to see is this moat totally deteriorated but I mean, hey, look at – and this worked out with one of your predictions as an old teaser as well. Alphabet is what, up 100% from the lows in April, something like that? Yeah, a little bit more from the lows. Year-to-date, I think it's like 60% to 70%. But yeah, from the April lows, I believe it's more than a double.

And the issue and why I say that it might just be a good policy to say – to create a list and say anytime any one of these get into a mid-teens EBIT multiple or lower, buy some, is because it's super easy to get shaken out when they get there. And you saw it with Google. Like the – there was a lot of bad press around Google at the time. the paid clicks had basically dropped to its slowest growth rate in maybe their like last two decades the apple vp of services had come out and said that they're seeing declining search volume for the first time ever and then there was also kind of this just general belief that chat gpt was going to take over and that like traditional search was going away now part of this is credit to google because they went out and produced a successful model in gemini and

they kind of rolled it out in a smart way i thought uh but yeah that was the most successful investment for me on the year and i have since trimmed it as well i i think it's basically at same price that i trimmed it at but it that has carried a lot of my gains for the year largest detractor for me this year was remitly however i also find that to be the most attractive opportunity in my portfolio right now so i'm not like it's not like i'm eager to sell that one and then the second best performer was actually coupon which is interesting it's had a drawdown but you had some good timing did you i guess heading into the year it was a bit lower than this yeah i think i can double check my cost basis but i think i'm still up like 20 something

percent year to date there uh well maybe you're maybe you're looking back at all time because year to date i don't think it's been below 20 20 but you might be looking at again when we were first looking at the company it wasn't that 14 to 15 dollar range and now we're at 22 um i'm just looking live but yeah maybe year to date that wasn't that best performer but since the cost basis it's up there with at one point it was my best performer year to date it was at 33 50 it's now in like a 30 50 30 to 40 percent drawdown so hasn't been fun the last few months but i agree with you one of my favorite opportunities at the moment yeah and looking at what are the two opportunities I'm probably the most excited about in my portfolio heading into

2026? It's kind of ironic that it's Coupang, which is one of my best performers overall, not year to date, but based on my cost basis, and Remitly, which is my worst performer actually in the portfolio overall, not just this year, but this year too. I like them both. And I think that's a good sign that i'm not just maybe anchoring to recent performance um or and you know i'm not like buying only my winners or watering the weeds kind of thing so yeah those are the two i like the most i guess google was very helpful this year it has historically been big tech big tech in the mid-teens has historically been a safe play um and that's your exception that's your that's your favorite uh favorite buy yeah i mean it's worked out

when i can't remember i think this would have been 2022 when amazon was below 100 that's another one of those where you kind of went oh you know this feels like a pretty easy hurdle there now that their actual earnings weren't that strong but if you're someone that can kind of look forward and even if they get just 5% up or any margin, things look pretty nice right now. One that we both, I guess, missed that was the biggest big tech opportunity was Meta in late 2022.

That's one where we had a bit of egg on our face. Did not look well. Did not look good in 2023 and 2024. But anything else about your portfolio, Ryan? How are you feeling right now? Any mistakes? Anything you missed? anything that you went oh this is a good like it might not have dollar wise or return wise been a

good decision like on paper yet but what is one one maybe decision you made this year we go all right i have high conviction on this one or something that you went and this probably is going to turn out to be a mistake i would say maybe the only one that i there's probably more that i missed just outright and just didn't buy at all i guess uh when i go back and look at some of those small cap of the weeks that we visited crack and robotics and dave were both huge successes but i wouldn't really i wouldn't say those were like in my wheelhouse the one that maybe upsets me a little bit is that i bought taiwan semiconductor at what i thought was an attractive multiple and there had traded down a little bit on some news and management seemed

super optimistic but i just made it a small it was like a one percent position and that's kind of another one that's big tech in a way like i guess big manufacturing but it's a huge wide mo if you think you're getting at an attractive multiple and for that one you know you have to do a little bit of forecasting you have to have a belief of what the future is going to look like because there could be some cyclicality i guess but i wish i sized that up more than i did because it's been a good performer since. Makes sense. Makes sense.

And I will use this to shout out on our sponsor right now, but has been a sponsor throughout the year and was a nice sponsor for us, Port Sido. It's a very helpful analytical tool to look at not just your overall portfolio performance, but what specific stocks on a percentage basis and on a dollar amount actually contributed to your returns. You can really help with, oh, did I size this correctly?

What actually hurt my returns? Was this a big winner? It felt like a big winner, but actually on a dollar amount, it didn't really contribute that month. So it was very helpful for doing this episode. I guess that can lead into my portfolio review. My money-weighted return was roughly 11% this year. Generally, as Ryan is as well, I'm not focused on one 12-month period.

At one point this year, I was slightly beating the S&P 500. I think if we look now, it's just below. We're tracking it depending on where we're trading. But in general, I think I was pleased with my decision-making in 2025 outside of a few purchases, which we'll get to below. First, let's talk about the good. The top three performers in the portfolio on a percentage basis, which were Airbnb, IBKR, and Grupo OMAB,

which is the northern airport operator in Mexico, not in this order, were the best three performers in 2025. And they were all new purchases last year. Now, my largest contributor on a dollar basis by far was Nelnet, which again, I'm happy with because I, well, it turned into 20% of my portfolio, but was at least 15 to 20% of the portfolio throughout the year. So the fact I sized that up and was correct about it, at least so far, I'm pretty happy with. Now let's go to the bad. Performance would have been better in 2025 if I did not start shorting. Again, the small percentage of the portfolio,

I like to remind the listeners on this, the high flying pre-revenue, what I want to try to say without swearing. Businesses along with three mega caps, I believe, are fairly overvalued or highly overvalued. Palantir, Tesla, and Apple that are going to be good funding shorts over the next decade. I guess the pre-revenue ones, the high-flying ones, that would be the nuclear companies, the eVTOL companies, and the quantum companies. It also does not help that I had a good percentage of the portfolio in the long-term treasury bond ETF, which I think is going to be a great hedge if and when the market ever crashes. Looking at all of these, though, let's say the market might not turn in 2026. It might not turn in 2027. It might turn in 2028. Who knows? It

could be any one of the next few years, or it might not happen for even longer. But I believe all of these are still fantastic counterweights in the portfolio. And the fact that it dragged a bit on returns in 2025, I think I was happy with because, or at least it's acceptable for me because it didn't kill the overall portfolio. It's still giving me flexibility as an investor. I still have more money I can deposit each year, each quarter into my portfolio. And then during a downturn, I hopefully will have the firepower to reinvest when my watch list stocks or some current possessions are cheap. If we look on a dollar basis for the largest attractor by far this year was remittantly global. What happened, and if you actually look at the stock, I believe

it isn't, you can correct me if I'm wrong here, Ryan, or I'm going to just look at it in real time. Year to date, well, if we go back 12 months plus from now, when we were first buying in, at least when I was first buying in October of 2024, I think Ryan did as well, they're about flat from there. A year to date, it's down 35%. But the mistake I made is to size up a little bit more into the position when it was above $20 a share. I think I look at my transaction history in Porsaito, which my favorite tool I found on there is you can go and keyword search the ticker to see exactly when you were buying or selling something, which can be either nice or very illuminating, not a bad purchase, but I bought some at $23, I bought some at $20,

and I bought a little bit more in the $17 to $18 range. That's been a big detractor so far. The mistake maybe was buying, whether it's going to be a revenue decel coming along with flatlining operating leverage for a few quarters. Maybe I should have been able to foresee that and waited for that to happen. I don't know. I think still over the next few years, my cost basis will prove to be a good buying opportunity. I'm very confident in the business, but for the last 12 months, it has nevertheless been a large detractor to my returns. And that's about it. Anything else, Ron, before we head to predictions review? No, I actually made the same mistake as you, or at least it's a mistake at the moment, which is I sized up my Remitly position on the way up,

which is something I don't typically do, but I think maybe I was just inspired by David Gardner at the moment. And they had accelerated revenue growth. It seemed like there's just a ton of momentum at the business. And so I sized it at a higher price than my cost basis. And in total, I'm down, I think, 25% on the position. But like I said, I think it's in a good spot right now. The other one I mentioned, you called it out as well, is the Argentine airports. Well, I guess it's more than just the Argentina airports, but that was a big opportunity. And it was one where I think as I'm looking back at my portfolio, one of the biggest mistakes I make is that I buy positions and then in my head I think okay I'm long that stock or you know I have

a I'm a shareholder of that stock and I don't really appreciate that it's going to if I have a 15 position or a 10 position it is so much more important that I am right on my big positions than being right on a bunch of small ones so that's kind of my takeaway for myself this year is focus on my it's fine to have these starter positions and you know kind of as tracker stocks that's kind of how i treat them but i need to be very confident in my top four or five positions if it's going to be heavily weighted you know i think for my top three or top four positions i think it accounts for about half my portfolio no matter how well those starters track tracker stocks do if i have bad performance in my top positions it's going to be a tough year so

that's probably my biggest takeaway moving into 2026 do we want to look at our 2025 predictions it's uh always a little slice of humble pie i've found maybe one that we got right but usually it's kind of a slice of humble pie when we look at these yeah and to be fair they're supposed to be really slightly bold predictions to make it fun. But why don't we go, well, we can just alternate starting with you. You had three, I had two to make it five for 2025. We'll start with one of yours, which you were the only one that had any right. So we'll start on a positive note. If you're a regular listener to Chit Chat Stocks, then you know that we love investing in international stocks and no brokerage compares to interactive brokers, otherwise known as IBKR,

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I wouldn't use any other brokerage for my investing needs. Switch to IBKR and level up your international trading game today. If you're interested in checking them out for yourself, head on over to IBKR.com. Interactive Brokers is a member of SIPC. Yeah, this wasn't that bold, but it was basically the take was that the Magnificent seven was going to have a good year and my exact uh my exact prediction was that the magnificent seven equal weighted which looking back on this i'm surprised i included tesla i feel like i just didn't process that magnificent seven included them um biggest contributor right yeah they ended up being the biggest contributor but well actually other than google i think i think google might

Yeah, it's up there though, better than 12%. Yeah, the Magnificent 7 equal weighted will be up by more than 12% in 2025. That was my prediction. This did prove correct. The Magnificent 7 was up by 24% year-to-date on average, led by Google and Tesla, and then the worst performer being Amazon. But all of them had positive returns in 2025, And Amazon was the only one that had single-digit percentage returns.

And that leads into my prediction that I got wrong. And this was Amazon finishes 2025 with the largest market cap in the world. Completely wrong on that one. And I ran it back from the year prior. Did not work out whatsoever. I'm a believer that Amazon could have the largest operating earnings in the world from a single company. They may be excluding, I don't know, Saudi Aramco or let's just exclude any of those out there.

But even of just the MAG-7, I think they have the highest earnings potential. But the key there is could. They could have those earnings. This year, I think it's short again. They have no cost discipline. We talked about it on the episode prior from last Wednesday in detail. We had a nice debate on that. I guess I should not have been fooled by that.

they completely stalled their operating margin expansion however regardless of making any absolute prediction of oh they're going to finish the year the largest market cap they're going to be the best mag 7 in 2026 I think and maybe you can tell me if you agree or not this is the best risk reward in big tech over the next three years yeah the only other one that I'd maybe put in there would be meta at the moment it's technically the cheapest on trailing multiples but i agree and i was actually it was going to be one of my big predictions for 2026 i've since removed it because i don't really see what the catalyst is for 2026 specifically but i do think like you said three to five years this feels like one of the best risk awards and

it feels like of all the big tech companies they have the most hidden profit potential and i say hidden just because it's like they aren't they aren't showing it now it's not hidden people know that they could be profitable but they have the highest profit potential that that's not yet reflected yeah well yeah it's going to take some harsh um how would we say it cost cutting if they're going to get there because i saw today that they announced a new partnership for alexa plus with expedia square and angie heavy hitters in the software space it yeah that just kind of encapsulates everything yeah i honestly have no idea what that partnership could entail i really don't like yeah i agree with you okay let's move on to your second one it's one that

unfortunately is a company that i am short luckily i didn't short it to start the year although it has been a slight loser for me was the company ryan yeah my second prediction was that palantir would get cut in half and i could not have been more wrong the stock finished up 157 percent in 2025 so far it and actually it's funny going back looking at my commentary and it was like the the multiple is just insane it trades at a forward price to sales of like 46 or something like that let me check it now because i think that insane multiple might have doubled yeah we're at about 120 or 115 forward maybe not uh trailing i think we're at about 110 120 either way it's Yeah. At the start of the year, the forward price to sales multiple was 41, and today it's basically 82. So yeah, as crazy as I thought the multiple was then, it has doubled. So I could not have been more wrong on that. I did not short it. So I don't short.

We can look at my maybe percent return on Palantir year-to-date. I think I can pull it up quick here on Fort Saito. Let's look. Oh, it says positive. Oh, no, it's for the day. Yeah, that was not going to be right. Palantir percent. Ooh, down.

Just remember the tiny position. It's less than 1%. Cost basis down 49% from my cost basis. And I still think it's going to be a fantastic funding short over the next decade, just given the absurd valuation. I'm going to debut this term on the power, I think. Maybe I've mentioned it before with Shopify, but I think we can officially call when a stock hits that 50-time sales, 100-time sales range, I want to call it the Palantir zone. I think that's a fair term. Yeah, they're kind of the quintessential one right now.

we're seeing like rocket lab enter that there's some pre-revenue ones out there that maybe we also be included palantirs entered the palantirs zone and it is expanding the definition of what a growth stock can trade at because 100 times sales man it's crazy what gets me is so for those there might be some people listening to this podcast that are like haha suck it you were wrong you were such a skeptic which you're right sure yeah but it be if we're doubling down on that like say we both double down on that it becomes much harder for the price to sales multiple to double again when it's had a 460 billion dollar market cap however much the momentum yeah however much momentum you have as you know like think you love your shareholder

base you feel like you're on their team you're gonna have to double that again basically or everyone's gonna have to double their wealth and buy twice as much palantir if if you want the multiple to double again do you think palantir's price to sales multiple forward right now it's at 81. Do you think it finishes the year below 40? Forward?

Can we use trailing? Trailing's easier to... Sure. I'll still do 40. I'll say below. Trailing at the moment is 120. How about this? Do you think it finishes below 60?

Yes. I feel like The base rate, if you want to use that, there's not very many instances in history of a stock trading at above 50, 60, 70 times trailing sales. Let's shop if I barely traded there, stock totally collapsed on any sign of weakness. I think that's more likely than not to occur because the expectations are so wieldy that That no matter what they claim on revenue growth contract stuff, it's just not going to work out. And eventually once the momentum trade ends, it's going to reverse in a big, big way.

Yeah, and it's like some of this is out of their control. What happens when a big customer drags their feet on an agreement renewal or a price increase or a new customer contract? And all of a sudden, your revenue growth is a little slower that one quarter. When it's priced for perfection, you got to be perfect. And sometimes, especially in large commercial B2B software, there's quarterly – like some things don't happen on that three-month span. Sometimes it carries over to the next quarter or whatever. and i i just feel like there's a chance we get like a temporary slowdown and it just craters the the stock but anyway that was my second one and i couldn't have been more wrong

so so far i'm way off what was your second prediction yeah the second one was nintendo's us adr will double to 30 this one was much more painful i'm also a shareholder so it was painful realistically. I was even feeling pretty confident. A little cocky when it hit $25 this summer. We were ahead of schedule at that point. But today, we are below $17. They totally fumbled on the goal line. Still a solid 14% return before dividends year to date. So you can't be unhappy with the stock returns, but this one does stink. There are RAM memory issues that really do not change anything about the long-term thesis but i think the stock remains incredibly cheap the four returns over the next few years are going to have to be quite strong to make up for a few

years of basically nothing i still think they can do it i'm pretty confident this business numbers look really great yeah didn't happen this year but it was a fun ride to track and so that's all i gotta say yeah you were feeling a little confident come summer which you should have been i mean it went we got close you were well on the way to 30 yeah still a decent return for the year so nothing to be too upset about all right let me go with my third prediction from last year i said google will be the largest company in the world by the end of 2025 i did not quite get that one correct well it was almost a bit almost a comeback almost made a huge comeback i was directionally correct they went from the fifth largest company in the

world to the third largest but they are still today behind both nvidia and apple honestly i maybe could re-up this prediction for 2026 and double down here and say that they will be the largest in the i like yeah let's we'll do that one as an honorable mention i like it i think if i was forced to choose a company i would pick them as well and it's not necessarily that i think there's like a whole bunch of room for google to like i'm not that optimistic about google from here just because the multiples doubled in six months but i'm fairly pessimistic about nvidia and apple not i'm not like super bearish but i i would be i could see them if they both drop 20 and google holds there's a chance google's the largest company in the world

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my portfolio transactions and returns. I cover under-the-radar emerging moat companies with prior research reports on Oscar Health, Kraken Robotics, The Real Brokerage, and much more. emails will be sent out on a weekly basis explore the service today and find your next great stock by going to emergingmodes.com the link will be in the show notes i agree nothing to add let's move on to 2026 predictions we're going to do three each remember these are bold predictions to be fun a little bit provocative provocative with the listeners maybe get you thinking and they're not entirely based on our own portfolio though some as we will disclose we either own or are short of a first this one maybe is a two-parter that is going to make it difficult

but i want to thread the needle here with what i think is going to happen and shows when there's kind of all bark no bite with the thematic investment trade and then some bark an actual bite with a thematic investment trade the first prediction is that the ai boom continues however However, the mini bubbles in nuclear, eVTOL, and quantum stocks collapse. And full disclosure, I'm short all three of those thematic investments right now. First, kind of my notes here. Even if OpenAI wobbles a bit and Oracle is maybe considered, this might be too harsh, but a joke of the hyperscalers.

They're free cash flow negative right now. They seem to be signing very uneconomic deals. the reporting out there is that they're extremely inefficient in building data centers, using something like a billion dollars worth of generators with some note I saw that might be destroying your ROIC. But the big four, Alphabet, Amazon, Microsoft, and Meta still have that partnership ecosystem. They still have the cash flow to keep growing AI spend. You have others out there. It's hard to imagine why this stops in 2026 from these core people. I mean, You could have the core wheeze might collapse, you could have an oracle that stops, open

AI again, might get into a difficult spot given their projections and how aggressive they are, but the big four can keep things up outside of a huge energy bottleneck. And second, NVIDIA revenue growth may slow down, which I'm not going to take one of your predictions here, but I think that could impact the stock price. But even if NVIDIA's revenue growth slows down, that's not the end of the world for AI adoption, which I think may even accelerate yet again. I got access with the, I think it's called the Google something subscription. I have no idea. They have a lot of names for things, but I recently got an email, hey, you have access to Gemini 3 Pro. And it is really, really good.

It's incredibly valuable to me. It's 20 bucks a month, and I think they could probably upcharge me on an even higher price third the nuclear evitol and quantum stocks are all pure stories they will likely end in zero execution there are there's there's either no revenue here or fake revenue um these are classic niche bubbles we've seen it time and time again over the last 10 to 20 years 3d printing solar energy electric vehicles you can add any you have in here ryan uh cannabis These things go up 10x, you realize there's no business models or broken business models, and the stock prices generally collapse. So how are you going to measure this prediction?

Oh, yeah, good question. I think, well, the nuclear stocks or the nuclear quantum and eVTEL stocks I think need to be down 80%. Is that a fair? I don't think that's right. Do you have them picked out? Oh, okay, yeah. The nuclear stocks, that's Oklo and Nanonuclear,

which is an interesting story we don't need to get into, and Newstale Power. Evitel is both Archer and Joby. Quantum, there's the big four. Some of my favorite companies out there. Rigetti Computing, as some people like to call Rigatoni. There is IonQ. There's D-Wave Quantum,

and there's Quantum Computing Incorporated, which they got very creative with their name. Those are the ones, and they're all shorts in my portfolio. On the AI side, I'd say AI CapEx spend across the hyperscalers, the big four, higher in 2026 than 2025. This one feels unlikely, but if I was at the casino, I'd get some good odds on it. Yeah, the AI CapEx thing, I think it's already been sort of telegraphed a bit.

That can change, though. That could change, right? Well, I think a lot of it is, like, CapEx commitments have already been made, probably. Yeah, you can halt, but you can halt those, I mean. They're someone else's, they are someone else's remaining performance obligations, so. Yes, and they haven't, it hasn't gone into the ground yet, it's not CapEx. i know i i'm i would just be surprised i would be very surprised if capex was not higher across the big four next year however i would measure this by does the does it close higher than their projections for next year like if if they're

because that's where i think we're going to see ai get hurt is when what they are talking about their their full year capex estimate for next year when they start revising that down okay but we're early on this because they haven't given out 2026 guidance at least i don't think so i think so on the number for capex yeah yeah pretty sure 2026 all right look them up fine so all right find them while i'm talking because what i'm looking is they have the 2025 figure which I believe is roughly about in between $300 billion and $400 billion. My thinking is that the guidance at the start of the year and what they actually spend throughout 2026 is going to be,

this is a small part of the bet of the two-parter, it is fairly likely, like that is not going to quote-unquote pop, as some people are proclaiming. Even if I think part of the industry feels bubbly, OpenAI feels bubbly, oracle feels bubbly core we feels bubbly some of the other players out there and then anything associated with this nuclear eb till quantum stocks are going to fall by the wayside as the actual value out there which is flowing to the big tech companies is going to continue to be materialized did you find anything for me ryan i think you're right so well i'm just checking google this is the first one but it says we now expect capex to be in the range of 91 to 93

billion in 2025 i forgot that they were on q3 uh up from our previous estimate of 85 billion looking out to 2020 2026 we expect a significant increase in capex and we'll provide more detail on our q4 call this is not a high hurdle across the base but i think throughout the year yeah it's not guaranteed that it's going to be higher there could be some revisions downwards things go wrong all right we're going too long on this one what is your first one ryan also mag seven related not the rest of them not entirely mag seven related just for people that get bored with this yes so i was right on mag seven last year i'm doubling down on my mag seven senses i think the mag seven equal weighted return will be negative this year so

the only i could be wrong here but what i'm thinking is looking at the mag seven most of them feel richly valued other than maybe meta like if we're looking ev to ebit right now on average and i'm excluding tesla tesla would distort the average much way higher the trail trailing ev to ebit is 30 times which is up a lot from last year and last quarter we saw big tech put up pretty good numbers across the board and they got virtually no reaction from investors And I feel like historically when that's happened, like you beat and raise and investors don't budge, that's a sign that like you're kind of at sort of a valuation ceiling. Like when investors are expecting to beat and raises constantly and that's what they deliver and it doesn't – nothing happens. It's like, okay, this feels like a recipe for multiple compression.

Okay, when I sell my business, I want the best tax and investment advice. I want to help my kids, and I want to give back to the community. Ooh, then it's the vacation of a lifetime. I wonder if my head of office has a forever setting. An IG Private Wealth Advisor creates the clarity you need with plans that harmonize your business, your family, and your dreams. Get financial advice that puts you at the center. find your advisor at igprivatewealth.com yeah the animal spirits are definitely there there are people just if you're a listener to the show you may or may not be in this industry or you might

just be an individual like ourselves but we have the advantage where it doesn't matter what we do each quarter doesn't matter if we chase the index but there are a lot of people out there that are either index huggers because of their job or index chasers and they want to try to would be very, very poor risk for themselves in their job to get behind on any AI stocks. If you kind of get what I'm trying to explain here, right? It's like underperformed because you have no AI exposure. Now, right now it's a little bit because of Alphabet.

I have very, very, very little AI exposure and even some on the downside with Palantir. Amazon too. be okay i own amazon yeah we can be okay with not with being underexposed to ai for if we think it's not a good risk reward but there are a lot of people have to chase into this and it's turned into a whole momentum thing pod shops whatever and at some point people are gonna it turns into hedge fund hotels turns into crowded trade and i'm using a lot of a lot of buzzwords here but eventually people get out and it feels like a good time for them an ebd bit of 30 times giant

companies if you add in tesla there it's trading at 200 times i think you're probably underestimating the optimist upside but that company um i'm talking my book seems it's at all stocks at all time high it feels yeah it's extreme to put it mildly so i like this one to be clear this is not like i don't think the mag 7 is going to implode I think you're probably going to get some stability out of like Meta and Google and maybe Apple as well. But I just, it's hard to see them putting up another 12% plus return across the whole mag seven this year. So my, my bold prediction is negative returns for the year. Let's keep moving here. What is your second prediction for 2026?

Okay. This one's a bit of a theme and I think it's a theme that's getting downplayed I'm not sure why everyone hates these stocks. I guess one of them is Mag7, but it's a theme I like for 2026. It's one I'm invested in. It's one that I can see myself adding to exposure to as I study some more of these companies.

I think e-commerce, strong performance in 2026. The criteria is group of stocks, Amazon, Mercado Libre, Coupang. You could even toss in some other ones that I don't know as well as C Limited. Maybe exclude Jumia. Alibaba

and some of the Chinese players whatever Chinese player you want that's fair game I believe these stocks and I'll look at the core three are the ones that I'm very optimistic on are Amazon MercadoLibre and Coupang I think they will be up on average 20% in 2026 or

if there's a market downturn beating the broad market S&P 500 NASDAQ 100 indexes by at least 10 percent in total return for the year thoughts on this one ryan i like it i like the thematic approach i've got a thematic one here as well and it feels like there are some like themes slash segments of the market that have been beaten down in 2025 but it's mostly news and story related as opposed to performance related and i think e-commerce is one of those

like amazon mercado libre coupon especially are are their competitive advantages all still intact i would say yes like they are the leading vertically integrated e-commerce providers in their region and for the last 25 years 20 years i guess that has been if you can deliver faster cheaper that tends to win out in the long run i think in the case of coupon mercato libre and amazon that that is still true i'll move to my second one here unless you have anything else on the e-commerce basket nothing to add nothing to add go right ahead i think there will be a SaaS resurgence. So software as a service resurgence. I was looking for an ETF to sort of express this, like to pick one ETF that I could track, but a lot of the software ETFs

are market cap weighted. So they have a ton of Palantir exposure. So I can't really use that because I don't think Palantir is going to do well. So I have to handpick a few of these. My focus here is B2B software stocks that are down 15% or more this year and are seen as quote-unquote AI losers. So I think an equal-weighted bucket of these six stocks will be up 20% or more in 2026.

Adobe, Monday.com, Salesforce, ServiceNow, Dassault Systems, and Constellation Software. Need a better French accent there on Dassault. Sorry. I just looked it up while you were talking. I hadn't heard of Dassault for a while. We studied them, I think, back in maybe a few years ago, 2021. Very surprised to see the stock down 27% in the last five years

because for all intents and purposes— If it's something that engineers, technology people, architects, construction workers, what have you, any sort of technical expertise person, if they have to get certified for your software to work, that is a pretty good moat. And maybe I need to look at this one yet again. Yeah. So that's my, those six stocks, one more time, Adobe, Monday, Salesforce, ServiceNow, Dassault Systems. And Constellation Software, I think equal weighted, those will be up 20% plus in 2026. For the listeners, Ryan, which ones do you own? Adobe and monday.com.

Those are the only two. I'm not that excited by Salesforce necessarily, but it's more sort of just like a rebound play. Like, I think the multiples are still more than I'm willing to pay for some of these, but I think there's the narrative that demand is going to disappear because of AI for a lot of these, I think is overblown. And if you get the realization from investors that that's the case this year, I could see multiple re-rating for a lot of these. All right, let's get to my third one. I think this is a fun one. and it's i guess another two-parter because we need something to happen that i think actually might not happen even though there's reporting that there's plans for it to happen in 2026 first

a spacex ipo marks the end of the bull market and then second it causes a blow off top in the space thematic trade rocket lab is a part of you know one of the only stocks you invest in in this industry, goes through a blow-off top, and then falls 80%. Just like Riven in 2021. Maybe it's just me bitter for missing Rocket Lab at $4 and sitting on my hands and having a potential 20-bagger, although I probably would have sold before this run-up. Yes, is this a good business? Yes, I think it is a good business. They're the second

coming of SpaceX. I mean, it's a good business, but they are at a market cap of 50 billion dollars and spacex at what they are reportedly going to ipo at 1.5 trillion dollars are wildly wildly overvalued for capital intensive businesses to trade at 50 to 100 times sales in the palantir zone i should say or i mean if you can get that capital raise and raise all that money fine by me but i think with rocket lab which i think last i checked 75 times sales it's going to be very very difficult given these are low margin businesses for you to make up all of that value criteria i think spacex has to go public and then brought and it marks kind of the top this one is a little bit maybe a three-parter and it marks the top

of the bull market and then rocket lab falls 80 percent year to date it's gotta be like i'm thinking about rocket labs management team's perspective it's got to be a little distracting to constantly have either like 50 times sales multiple or five times like these guys would i'm sure they would appreciate a little consistency in their valuation because you constantly have to I imagine manage expectations internally and do we like, unfortunately, I would guess that most people like finance purists would tell you that the right thing to do is shelf offerings, secondaries when you're at a 50 times sales. Yeah, they have an ATM.

So pretty smart by them. Another one I'll add in here, AST Space Mobile. I know we had, I've never owned it, but we had an interview that was one of our most popular shows of the year. I know some people like the stock, but you want to guess where the stock is now, Ryan? $85. Ooh.

$85 a share. This is pre-revenue company. Market cap. Let's go full screen, check it out. Market cap, $31 billion. $31 billion. Again, high expectations. The theme for space stocks is going crazy.

And I think SpaceX IPO, at least for space stocks, is going to mark a top if it happens. All right. My third last prediction for 2026. This one might anger people. Yeah, it might. I think NVIDIA will be down more than 15% this year. Now, let me explain my rationale. And I'm not pessimistic about NVIDIA per se.

I actually have like Jensen Huang to me is like a top CEO. If you're picking a Mount Rushmore of active CEOs, I think he's done an exceptional job. The whole management team has. But I think we are starting to see a little more cautiousness from the investment community around this AI CapEx. And I think executives are going to start to feel that pressure. And we could see kind of what you alluded to, maybe some CapEx revisions, some CapEx estimate revisions or expectation revisions from management, whether or not that actually reduces CapEx outlooks like the – if investor pressure doesn't reduce CapEx outlooks, I still think NVIDIA could have a difficult time. And here are sort of the three dynamics that would concern me if I were an NVIDIA shareholder. Last quarter, they saw a huge boost in sales, a massive beat, market didn't budge.

That's typically a sign of sort of you're maybe at high levels of investor enthusiasm when huge beats are already baked in. the second one there's a rising prominence of or at least perception of in-house chips or competition with big tech from the uh google tpus the tranium which i don't know if that's really a direct competitor with nvidia but there's chime in here brett if you've read up more on tranium than i have i hear terraniums but a bit behind but hey it's still supply that's not going to nvidia even if the chips are quote-unquote not as good well if you have a million getting used by anthropic those are chips that aren't nvidia chips yeah that one's a little more speculative obviously since i don't have certainly not a semiconductor expert but all they need is

revenue revenue growths decel that's all right right i think that is seriously all that it needs and the last one and this is kind of the one that maybe makes me the most cautious is that management seems desperate to keep a positive narrative the they the maybe the biggest red flag i saw from nvidia this year was when they released that private rebuttal just to wall street analysts to michael burry's critiques around like supply oversupply and stock-based compensation the other one was jensen publicly stating that if we delivered a bad quarter the whole world would have fallen apart like he knows it and it makes it feel like he's like you're kind of trying to keep up the best impressions you can and it just feels like that

can't last that can't go on forever he's also can i say it's fair he's a bit of a drama queen maybe but i don't know if so a whole world wouldn't have fallen apart sure but i don't know if he is wrong about equity markets i think equity markets would have had a very tough time if nvidia saw a massive revenue decel and then there's also been like the kind of jensen huang press tour like him going on joe rogan all that stuff which whatever but it just kind of feels like there's this need across the board for them to keep up a positive narrative which to me makes everything feel a little fragile yeah really really trying to get this chip sales into china just working extremely hard on that that's a whole another piece

it's funny looking at these because right now I'm like yeah these are I got a high confidence in these these seem like good bets now that I actually make not all these bets from my actual portfolio although Rocket Lab a little short there feels

interesting Neutron might get delayed I just got a feeling on that one but you look at them you go I have a lot of confidence here but it always turns out we get more than half of these wrong at least absolute or maybe if we're directionally right we're still not right specifically on the bet criteria

it's just a lesson in having that long term time horizon markets can be a bit manic over a 12 month period and that it's very very hard to make predictions so don't be chasing every new story

I don't think we're that bad but for predictions themselves the fact that you need a lot of things to go right just makes them less likely it's not it's less likely than a coin flip if you're just going to pick randomly it's not how you should invest you should wait for the quote-unquote fat pitch and hold those winners let your winners ride let the companies themselves tell you they're right and then just hold on yeah if i'm if i'm looking at sort of the vibe check for us heading into 2026

there is some there's some pessimism with sort of our predictions i like i think big tech might have a rough time if that is the case historically when big tech has had a rough time even if i've been like yeah i called it my portfolio gets hit i don't avoid it so it's it maybe is a chance for me to kind of do some reflecting on what i own today and am i comfortable with the positions like for example i still own google i still own amazon and i think mag 7 equal weighted will be down this year should i maybe trim those i don't know i think this is actually a useful exercise for everyone to write down some 2026 predictions for the market and kind of see where you see what the vibes are of your general belief it shouldn't don't overweight it but it's kind of a nice

exercise to do and you can even focus more on your own portfolio we try to not entirely focus on just stuff that we own since it's only generally 10 to 20 companies and we don't want to talk about that constantly but again maybe make some predictions for your own portfolio see what's right see what's wrong it's good to journal and go back a year later let's close things out we're running up on our hour here ryan with a listener question i was in the sub stack chat i will say go on to that one when this and i think drops you will have one more day to participate in our 2026 stock pitch competition all you have to do is give me one ticker you're going to be long that ticker and starting january 1st the performance of 2026 but a listener question in the sub stack

chat which everyone should join what are your goals investing related for 2026 ryan i'll let you go first yeah i've thought about this i mean i have some like whatever some like nominal financial goals for where i'd like to have like you know savings but i'm not going to share those i would like to have a i know this sounds maybe like not sad but like a low bar i would like to have a positive year because what i'm what i'm worried about is i'm looking at my portfolio and aside from coupon and remitly which i'm optimistic about a lot of the companies i own are kind of in no man's land like i'm not maybe a little re um portfolio allocation redoing it a little bit yeah because it's like i like taiwan semiconductor

it could be in for a little bit of a difficult time if we do see that nvidia slow down and slow down in some of the ai spend yeah high earnings multiple could be peak earnings you never know right i i like i liked google but the multiples not like a screaming buy so it's just kind of and i i like all of these businesses long term but like i said it feels like it's a no-man's land because i'm not buying more of them aside from a few of the companies in my portfolio so i guess an investing related goal for me would be positive returns for 2026 which maybe means time for a little reallocation all right i'm going to say my investing goals one just save as much as possible i guess that's that's another one as always be be uh be frugal

in that regard but from a maybe a podcast newsletter and personal investing um criteria you kind of all into one is to study let's say 10 new businesses and become like that i'm interested in and become an expert on 10 new ones i mean it's a good sort of goal for people to have we try to help out with that with the podcast and newsletter but you're not going to learn every business in a year. But it's something that I saw who is a longtime newsletter writer, big fin twit personality. A lot of people may know mostly borrowed ideas. He has, I think for five or six years now, wrote once a month a stock research report that's comprehensive. And after his research, he goes, hey, I think I'm an expert on this company.

Does he invest every time? No, but he's an expert to say, I'm going to be able to make investing decision. If you just slowly start studying businesses, that knowledge will compound and it can help you study the next business. Where if I understand all these players in the industry, we have a new player pop up, well, then it's going to help make me more easily understand that business. Again, I just think the knowledge compounds. Maybe choose a couple of stocks that you want to become an expert in. Study them. It just takes time. Read the annual reports. read all the commentary read all the news reports looking at all the research and uh yeah i think that's that's my goal plus i guess advice for the listeners i like that and i

think just to kind of double down there the something maybe a mistake i made in the early days was i think a lot of young investors make this mistake you want to learn as many businesses as possible you want to go out and like you know read a new 10k every day or whatever you're you're hungry thirsty for knowledge it's a lot better like brett said to go really deep on a few businesses and understand really what are the drivers what are some of the things that you see in terms of like compensation practices with management how did this result in whatever the performance was understanding all the nitty gritty of individual businesses and then being because you take those lessons and you're able to apply them to every other company usually

or at least companies in their sector so i agree kind of going one at a time going deeper on individual businesses i think that's a good goal one more goal if i might add one i would like to i'm not gonna do it just for the sake of doing it but i would like to increase my international exposure i think there's a lot of opportunities beyond the united states at the moment i'm seeing some of the most attractive opportunities it seems abroad high valuations the us yeah i would like to i guess you know coupons a big position for me but i think there are some opportunities elsewhere that are worth digging into and potentially increasing exposure and the good thing about international is if you're not all focused on the u.s and especially if you're not

all focused on the u.s growth slash tech which i know a lot of people are just the numbers anecdotally versus what you see out there it doesn't guarantee performance through the market it cycle, but it helps you maybe perform better as long as you pick the right companies through any down cycle in the United States. All right. Anything else, Ryan, for the listeners before we wrap up on 2026 or wrap up on 2025 and look forward to another fun 2026? I think that's going to do it. The one thing I'll say, I know there was some general pessimism in some of our predictions. That doesn't mean there aren't opportunities out there. Keep digging, keep researching companies there's plenty out there hopefully we will provide some throughout

this podcast in 2026 all right yes that is a positive we usually for the most part do try to invest optimistically but maybe just with some cynical mindset given all the fraud that is out there in the stock market and some tough tough valuations out there today okay as a disclosure We are not financial advisors. Anything we say on the show is not formal advice or recommendation. Ryan and I are only podcast guests. May hold securities discussed in this podcast. May have held them in the past and may buy, sell, or hold them in the future.

Thank you, everyone, for tuning in. And we'll see you next time.