Sectors: Technology

NVDA can be a volatile beast that often dances to its own tune, but it’s an AI giant MM would like to own in our International Portfolio at the right price. The $US3.2bn AI behemoth has already corrected 17% from its 2024 high, and we wouldn’t be surprised to see it outperform further weakness across broader indices.

Shares in NXL were clobbered after their recent trading update at their AGM. While they reiterated their FY25 outlook for all key targets, the market focused on the comment that “sales are not linear over the course of the year, and our current expectations are that growth will be weighted towards the second half of the fiscal year.”

PEXA is an electronic lodgement and settlement network that aligns communication in property transactions between vendors, banks, lawyers and other participants in the transaction. It is a growth company, on a growth multiple/valuation, but has ultimately failed to meet market expectations.

Enterprise software juggernaut Microsoft (MSFT US), has enjoyed solid but not spectacular performance over the past year, up by 22%. There have certainly been bigger winners, with NVIDIA (NVDA US) +165% a clear and well-documented AI standout.

Apple was one of the “Magnificent Seven” which posted fresh all-time highs overnight as investors continued to buy the strength. With rates set to fall this week in the US, we could see further PE expansion pushing the stock higher as people struggle to find value in today’s rich market.

SEK has struggled to keep pace with CAR and REA post-COVID, and the August FY24 results did not help; they delivered lower-than-expected earnings for FY24 and a decent downgrade to FY25 guidance.

Real estate digital advertising business REA is another much-loved stock driven higher by momentum traders; history tells us that corrections can be sharp when the music stops playing in such circumstances.

We exited CAR on valuation grounds, a dangerous pastime in 2024. Even after retreating 10%, it’s trading well above its average multiple of the last five years, closer to 30.9x, making the risk/reward unattractive to MM around current levels.