| DAILY ISSUE What to Sell – and What to Buy – After President Trump’s “AI Action Plan” VIEW IN BROWSER Hello, Reader. In the 19th century, the phrase “another day, another dollar,” originated from American sailors who were paid, quite literally, one dollar per day. The idiom long ago lost its nautical connection, and it’s now used to express the routine, or even monotony, of any given job. The workday starts. The workday ends. The cycle repeats. But here in the United States, the better saying this year may be “another day, another executive order.” That is because, so far, President Donald Trump has signed more than 170 executive orders in his second term. An announcement is made. The order is signed. The cycle repeats. And just yesterday, President Trump added three more mandates to the list, signing a trio of AI-related executive orders. These orders support the White House’s “AI Action Plan” that the president also unveiled yesterday. The plan focuses on accelerating artificial intelligence innovation and aims to streamline the creation of AI-focused data centers and make energy for those centers more readily available. According to one of those orders, the administration will reward innovators “with a green light” so that they are “not strangled with red tape.” The White House has, essentially, pulled back restraints on big tech companies as they power forward in developing AI. And big tech is clearly in favor. Along with plenty of other Silicon Valley bigwigs, Nvidia Corp. (NVDA) CEO Jensen Huang and OpenAI CEO Sam Altman attended yesterday’s action plan event. However, while big tech may be celebrating, I wouldn’t touch a single overhyped tech stock right now. Collectively, the major tech companies are spending hundreds of billions of dollars to develop leading-edge AI capabilities. This monstrous investment imperative could stifle their profit growth and hinder free cash flow generation over the next few years. We can see this already happening with the popular “Magnificent Seven” tech stocks. So, in today’s Smart Money, I’ll dive into why I don’t recommend this overvalued group… and some of the places where I am looking instead. Recommended Link | | | | In 2000, Eric Fry told Barron’s magazine that investors should sell a very popular dot-com stock just before it plunged 90%. Today, Eric is saying the exact opposite about it — “BUY NOW!” This same company is now the lifeblood of AI data centers — yet it’s completely undervalued. He says anyone who owns Nvidia stock would be well-served to sell those shares and buy this under-the-radar play instead. Get Eric’s full take on the situation right here… |  | |
Not So Magnificent This group of tech stocks –Apple Inc. (AAPL), Microsoft Corp. (MSFT), Amazon.com Inc. (AMZN), Alphabet Inc. (GOOGL), Meta Platforms Inc. ( META), Nvidia, and Tesla Inc. (TSLA) – has captivated investors for the last three years. It’s understandable. They are highly influential companies that lead their respective fields, from AI to cloud computing, and e-commerce to electric vehicles. While some members of the elite group are still performing well, like Nvidia and Microsoft, the group as a whole has seen a decline in performance this year. Tesla, especially, has experienced substantial losses. Just today, shares of the EV maker fell 8% after the company announced yesterday that it missed both top and bottom lines for the second quarter of 2025. In fact, CEO Elon Musk said that the company “probably could have a few rough quarters” ahead. (I will dive deeper into why I believe Tesla to be a “Sell” in Saturday’s Smart Money. Stay tuned.) Although the Mag 7 stocks are world-dominating tech giants, they have embarked on a stratospherically costly mission to establish and maintain technological leadership of the AI world. For example, the four leading “hyperscaler” data center operators – Amazon, Microsoft, Alphabet, and Meta – have invested an astounding $1.5 trillion during the last five years in research and development, plus property, plant, and equipment (i.e., data centers). And their pace of spending is increasing. 
These four companies are on pace to spend more than a half-trillion dollars this year on R&D, plus property, plant and equipment. For perspective, their combined annual net income last year was only $315 billion. In other words, investing in AI technologies has become so mind-bogglingly expensive that winning the AI race could prove to be the ultimate Pyrrhic victory for the tech giants. The more they emerge victorious in their AI breakthroughs, the more they have to spend to fund the next development. These companies are a tech-driven Sisyphus, continuously pushing the boulder of AI advancement to a hilltop they may never reach. So, I prefer to abandon that hill altogether. Instead, I am looking more at lesser known, but greener, pastures. These are the types of companies that are often overlooked and underappreciated, but which are capable of delivering great results… especially when popular investments are not. The Two Halves of Successful Investing As I mentioned in yesterday’s Smart Money, knowing what companies to run from is important, but that is only half of the investing picture. The other half is knowing which companies to run toward. Clearly, I don’t recommend investing in any of the Magnificent Seven companies right now – or any other overhyped tech stock, for that matter. So, what are the safer alternatives? Well, I’ve compiled a list of three companies that I believe are “Buys.” These are under-the-radar, early opportunities that can help you protect and multiply your money during make-or-break markets. You can find the details of these companies – ticker symbols and all – in my brand-new special broadcast, free of charge. What’s more, I also share four names that I believe are “Sells,” so you also know which stocks to avoid. These are companies with significant headwinds that could drag down your portfolio. Simply click here to watch my new broadcast. Good investing! Regards, | 
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