Claude fever, Nvidia scandal, whats next?
Disclaimer: Nothing I say or post should be considered financial advice. Please do your own due diligence before making any investment decisions.
So Anthropic is preparing its IPO launch, and it is going to happen as soon as next week. It is going to be one of the highest valued IPO in history, projected to be around 1.25T - 1.75T dollars. Trillion with a T! Thats how much hype their AI model, claude has generated. I personally use claude as well, so I can understand that the hype is probably justifiable. But its worth understanding that they are racking up debts in a rapid rate as well. Yes it is not actualized debt yet, however they will start this race on a backfoot as soon as they IPO. And they will need to compete with other established companies like $Apple(AAPL)$, $Alphabet(GOOGL)$ and $Microsoft(MSFT)$ with healthier balance sheets and better ability to leverage. So will they run out of steam before they turn profitable? Will people continue to stay in their ecosystem and pay for subscriptions as they adjust their price for inflation? Maybe these are questions for you to think about before you ride on the excitement and jump onto the Anthropic bandwagon on its IPO day.
So with the scandal that created a dark cloud for $NVIDIA(NVDA)$, surprisingly $Technology Select Sector SPDR Fund(XLK)$ as a whole showed a recovery yesterday after the absolute bloodbath last week. And of course they do, the stock market is not a linear graph. So after such a deep drop, there will bound to be an upside reaction. But is this really a sign of meaningful rebound? Or just a classic deadcat bounce? And other competitors of Nvidia will be circling them like vultures now, ready to capitalize and snatch away market share. Watch MU and AMD.
I still believe in my thesis that this AI carnage is not over, and Anthropic IPO is not going to change that too. Any meaningful rebound is going to happen once a big tech company report a healthy balance sheet and prove that they can manage their capex spend on AI.[Victory]
@PawsAndProfits - Specialist in combining FA and TA for Options selling and Swing trading.[666]
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