Global Macro Specialist
Charles’ Note: The legendary Warren Buffett announced he’d be stepping down from his long-time role as Berkshire Hathaway’s CEO by the end of this year.
It seems that the Oracle of Omaha, now 94 years old, decided he could no longer keep up with those young whippersnappers like former Speaker of the House Nancy Pelosi, now 85.
Incredibly, despite her time consuming responsibilities as the representative of California’s 11th district, Ms. Pelosi has managed to generate investment returns of 692.75% over the past 11 years, according to data compiled by Quiver Quantitative. That’s more than double Buffett’s returns and more than triple the returns of the S&P 500.
We have two possible explanations for her performance.
- She is a genius and a market goddess with an uncanny ability to spot trends ahead of the pack.
- She’s actively trading on inside information that neither you nor I (nor Warren Buffett for that matter!) has access to, courtesy of her position in Congress.
I’ll let you draw your own conclusions.
You and I will never have access to the inside information Nancy Pelosi does. Even if we did somehow manage to get access to it, we’d end up in federal prison if we attempted to trade on it.
But that doesn’t mean we have to fly blind. My colleague Eric Fry, who I interviewed just after the Liberation Day tariffs were announced, is back with some solid advice to help you navigate a major reset in the tech sector.
Take it from here, Eric!
Day 108… and counting.
A lot can happen during that time.
The California gray whale migrates from the waters of Baja California, Mexico, to its summer feeding grounds in the Arctic.
Your favorite HBO series could air a new season, beginning to end.
The U.S. could declare war with its trading partners, potentially sparking a recession.
Eight days ago, on April 29, we hit “Day 100” of President Donald Trump’s second term. And it’s been chaotically memorable.
The following day, the Commerce Department reported U.S. GDP shrank by 0.3% in the first quarter. That’s the first drop in growth since early 2022.
The culprit is, in part, the trade war.
Businesses are rightfully growing more anxious. No one knows where tariffs are headed… or what new surprise comes next. t’s still in extreme flux.
Just yesterday, Canadian Prime Minister Mark Carney announced during his Trump visit that no trade deals are on the table yet… for his country or any others.
Uncertainty is like acid to the markets. And as volatility increases, certain sectors become vulnerable to overbought conditions. They may be overextended and poised for a potential mean reversion, which basically means they snap back up or down to something closer to their long-term trend.
This includes the tech sector… as was evident in April’s bout of earnings releases…
A Mixed Bag of Reactions
As it happened, Trump’s 100 days coincided with the Mag Seven’s earnings reports (that’s Apple, Microsoft, Alphabet, Nvidia, Meta, and Tesla).
Two common themes are immediately apparent: Tariff consequences and something even worse…
Tesla kicked off earnings season for the Mag 7 on April 22. It wasn’t pretty. Revenue fell 9% from the previous year, missing Wall Street’s estimate. Earnings per share came in well below what analysts predicted as well.
Trump’s tariff plans have raised concerns about rising costs for key electric vehicle components, from battery cells and circuit boards to manufacturing equipment and glass.
Musk says Tesla is “the least affected car company” when it comes to trade issues. But the company refrained from giving 2025 guidance, citing ongoing uncertainties.
Two days later, on April 24, Alphabet’s reported revenue and earnings per share surpassed analysts’ expectations.
AI advancements, including the rollout of Gemini 2.5, played a significant role in the company’s growth. But, the tech giant anticipates potential challenges due to upcoming trade policy changes.
On Wednesday, Meta’s stock rallied more than 5% after reporting earnings that blew past the estimates. Revenue climbed 16% year-over-year and forward-looking guidance was positive.
Then, shares of Microsoft opened about 9% higher last Thursday after the company announced earnings higher than analysts expected. This is the fourth consecutive quarter that the tech giant beat Wall Street’s estimates.
That same day, Apple also announced forecast-beating second fiscal-quarter earnings. But shares dipped 4% in extended trading.
Why?
Because CEO Tim Cook said the impact of tariffs was “limited” last quarter thanks to supply chain adjustments. But, he warned that trade-related costs could rise in the coming months.
Amazon has the same worry. Its earnings also surpassed expectations, but it expects its operating income to fall short . Cook called out “tariffs and trade policies” as a factor.
The final Mag 7 company – Nvidia – only reports earnings on May 28.
Clearly, the first common thread among them all is the tariff uncertainty.
But they also have something else in common…
Surviving the Tech Reset
These big tech giants are trading at incredibly lofty valuations.
The median Mag 7 company trades at 27.9X forward earnings. That’s 55% higher than the median S&P 500 company.
As I mentioned, overbought companies – like the Mag 7 – may be even more susceptible to volatility that could trigger a nasty snap back to “healthier” levels.
In other words, America’s most popular tech stocks could come plummeting back to Earth, erasing years of investor profits.
So, with the risk of these overbought stocks correcting, it’s crucial to stay informed…
Like how the leaders of these companies – including Jensen Huang, Tim Cook, and Jeff Bezos – are offloading their own shares at a record pace.
In fact, according to a financial filing released late in April, Bezos disclosed a plan to sell up to 25 million shares of Amazon stock over a period ending May 29, 2026. (Bezos stepped down as CEO in 2021, but he remains the company’s top shareholder.)
However, there is a way to sidestep the incoming potential losses on overvalued stocks…
Moving money out of Big Tech and into the investments that the “top 1%” are piling into. Investments that are least likely to suffer the consequences of this Trade War.
My friend, InvestorPlace colleague and legendary investor Louis Navellier uses his proprietary system, which he calls The Grade, to find those stocks.
The Grade is the foundation that Louis built his financial empire on. In one remarkable 15-year stretch, his portfolios returned more than 60% while the S&P 500 only averaged 10%.
The Grade pointed him to Apple back in 1987. Shares have soared as high as 589-fold since his initial recommendation. That’s a 58,800% return.
It did it again with Microsoft in 1990, when it was just trading for 68c. That recommendation 54,000% return.
In 2005, it pointed Louis to Google, which has returned 2,500% since then.
These gains sound ludicrous… but each and every one of them is tracked and recorded and his track record is available to the public.
Now, The Grade has green-lighted stocks that could present investors with the biggest financial opportunity of their life-times… despite the Trade Wars… and in fact, maybe even because of them.
Louis explains here, and offers details of 12 stocks to consider immediately.
All are worth your time and attention more than the Trade War.