Ideas
Buy cheap high-quality stocks over expensive tech.
Thomas argues investors should buy cheap, high-quality companies rather than expensive tech giants because MAG7 earnings growth is decelerating and multiples are stretched. He says the only way not to make money in out-of-favor areas is to buy low-quality companies with balance-sheet risk; buying high-quality stocks when their index weighting and expectations are low tends to produce enormous gains over time.
MAG7 expensive with decelerating earnings growth.
MAG7 earnings growth is decelerating from 32% in Q3 2024 to expected 14% in Q3 2025, yet the basket trades above 30x. With roughly $400B of committed capex, up 67% year over year, and little evidence of return on invested capital, margins, buybacks, and EPS are at risk; he thinks the group may need to stall and is not aggressively positioned there.
Buy worst YTD stocks for November.
The final week of October is the end of mutual fund tax-loss selling. Stocks that have performed worst year-to-date going into late October often do extremely well in November once that selling pressure is gone.
Alibaba is cheap AI play, can double.
Alibaba was left for dead and called uninvestable at $60, but he viewed it as the cheapest AI play in the world with $80B cash and $25B free cash flow. At $175 it still trades at a low double-digit multiple with blue-sky AI upside and can double again.
Intel government-backed turnaround can double.
Intel was abandoned at $19 but now has a US government backstop and is the only US advanced semiconductor champion. He credits former CEO Pat Gelsinger for putting assets in place and new CEO Lip-Bu Tan from Cadence to execute a turnaround. Advanced fabs and GPUs plus a recovering legacy CPU business are tailwinds, and Intel can double or triple as advanced chip demand exceeds TSMC-constrained supply.
Comstock is low-cost natural gas AI beneficiary.
Comstock is a low-cost natural gas producer levered to AI and data center power demand. Data center demand is expected to rise sharply into 2030, with 60% powered by natural gas; Comstock is 75% owned by Jerry Jones, they built a position at $8-$10, and he thinks it can double again.
Left-for-dead real estate, staples may bid.
Along with energy, real estate and consumer staples are among the left-for-dead sectors that have only rebounded about 10% off the April 7 lows while the S&P is up 41%. He expects them to see a bid as MAG7 stalls and tax-loss selling pressure ends.
Buy out-of-favor high-quality energy.
Energy's S&P 500 weighting is the lowest since the 2020 COVID lows. Buying high-quality energy when it is this far out of favor has historically made enormous money, while low-quality balance-sheet-risk names are the only way to lose. He prefers energy services over E&P oil companies.
Prefer oil services over E&P.
Within energy, he is less sanguine on E&P oil companies and prefers services, which can benefit from activity and have a better relative setup when energy is deeply out of favor.
Value, international, small caps may outperform.
Similar to the prior tech mania around 2000/2001, when energy, value, international, and small caps outperformed for the next five to seven years, he thinks relative performance may shift away from expensive tech and MAG7 toward these lagging areas.
Buy equity dips on global liquidity.
Any near-term pullback from the government shutdown, mixed MAG7 earnings, or geopolitics should be bought because global central banks have already cut about 312 times in 2025, the most since 2009, leaving abundant liquidity to support a year-end rally.
Take profits, gold is non-productive guessing.
Gold is a non-productive asset and buying it is effectively guessing on future fear or debasement demand. While the weaker-dollar theme may keep gold elevated, he prefers productive businesses with analyzable cash flows. He advises gold holders to take chips off the table and beware a reversal.
Dollar trends weaker over time.
He believes the dollar will trend weaker over time, which he calls the correct debasement theme and the reason gold could remain elevated in theory, though he prefers productive assets.
Gold miners usually lose money, avoid.
Gold miners are a difficult business that somehow finds ways to lose money even when the underlying gold price rises; any free cash flow tends to be temporary. He would avoid miners despite strong gold prices.
This The David Lin Report video, published October 27, 2025,
features Thomas Hayes
discussing High-quality value stocks, MAGS, Year-to-date laggards, BABA, INTC, CRK, XLRE, XLP, XLE, OIH, Value stocks, International stocks, IWM, SPY, GLD, USD, GDX.
14 trade ideas extracted by AI with direction and confidence scoring.
Speakers:
Thomas Hayes
· Tickers:
High-quality value stocks,
MAGS,
Year-to-date laggards,
BABA,
INTC,
CRK,
XLRE,
XLP,
XLE,
OIH,
Value stocks,
International stocks,
IWM,
SPY,
GLD,
USD,
GDX
