Eric Johnston 5.0 2 ideas

The market multiple has corrected significantly while earnings expectations have risen, creating an attractive entry point. Megacap tech is poised to lead as earnings season is expected to be positive for the sector, with strong growth in cloud and a favorable outlook, especially given the demand for compute outstripping supply and extending the cycle.

Megacap tech will lead the market rally as this earnings season will be positive for the sector relative to stock prices. Growth rates in cloud will be attractive, and commentary about the outlook will be favorable. The demand for compute is still mismatched with supply, and building data centers takes time, which will elongate the cycle.