Neil Kaplan 0.3 8 ideas

TSMC and NVIDIA are key enablers of the AI ecosystem with supernormal growth, capable of delivering 30%+ growth on an ongoing basis due to resilient chip demand and investments in high-performance computing.

ASML is "nose down this morning" due to concerns over a potential U.S. order halting EUV equipment licenses to China. Commentary suggested 15-20% of ASML's revenue could be at risk. This is part of the broader U.S.-China battle for AI/chip dominance. ASML's EUV machines are at the heart of advanced semiconductor manufacturing, making it a geopolitical target. AVOID due to imminent regulatory risk that could materially impact a significant portion of its business, overriding the positive demand cycle from companies like Samsung. The U.S. does not enact the new restrictions, or the impact is less severe than feared.

CBRE announced they could reduce research costs by 25% using AI, but the "stock actually got hit hard." Investors interpreted the efficiency claim negatively ("Second-Order Thinking"). If CBRE can use AI to cut costs, external competitors or clients can use the same models to bypass CBRE entirely or force fee compression. AI is viewed here as a deflationary disruptor to their business model. SHORT. The market is punishing service intermediaries who claim AI benefits, fearing they have no moat against the technology. If CBRE demonstrates that AI actually expands margins rather than cannibalizing revenue.

"It takes between three and five years to build a new memory fabrication plant... creating this bottleneck." Hynix states the situation will "get worse before it gets better." Basic supply and demand. Demand is exploding (AI chips use 10x memory) while supply is inelastic (3-5 year lag). This creates significant pricing power for pure-play memory producers who sell the commodity rather than the finished device. LONG. Structural scarcity benefits the upstream commodity producer. Global recession reducing demand for end-products (smartphones/PCs), which could offset AI demand.

Musk and Cook warn that memory shortages are "beginning to hammer profits" and "inflate price tags on everything from laptops to cars." Kaplan notes Samsung is "impacted negatively" because, despite making chips, they are heavily exposed to manufacturing smartphones and PCs where costs are rising. The memory shortage acts as a tax on hardware OEMs. Higher Bill of Materials (BOM) costs squeeze margins. Unlike pure-play chip makers, these companies cannot fully pass costs to consumers without hurting demand. SHORT. The "crisis" narrative suggests margin compression for heavy hardware manufacturers. If these companies successfully pass costs to consumers or if memory prices stabilize faster than expected.