It’s one of the unspoken rules of investing – when a bull market dies, the stocks that led the bull market die with it. So when the next bull market emerges, a new group of stocks will be the leaders…
From railroads, to radio, to renewable energy – the pattern has been the same. And investors who cling to the old leaders tend to miss the best-performing stocks of the new bull market.
Cisco (CSCO) led the internet bull market and seemed perfectly positioned to ride the wave for years. But here we are, 25 years after the internet bull market ended, and Cisco's stock price still hasn’t matched its March 2000 highs…
Even Microsoft was dead money for 15 years…
The solar bull market of 2007-2008, the commodities bull market of 2009-2010, the pot stock bull market of 2018, the electric vehicle bull market in 2021-2022, and the “work from home” bull market during the COVID years all ended the same way.
It will happen to AI stocks, too. It might be happening right now – Microsoft is putting some data center expansion plans on hold, which will mean less electricity and fewer Nvidia chips…
But even if the AI bull market has a little life left in it, stocks like Nvidia are unlikely to lead when the next rip-snorting bull market starts charging.
I’m not telling you that Nvidia's share price will plunge more than it already has. It’s a very well-run company, and its chip designs are the best in the world. The point is that the AI chip cycle has matured. Analysts can hit Nvidia’s earnings per share numbers within a few pennies. That’s a stark difference from when Nvidia was an open-ended growth story and it consistently blew earnings estimates out of the water…
Open-Ended Growth
It’s difficult to say when the current bear market will end. And while it’s always tempting to lay a bunch of if/then statements about the economy and tariffs and all that, that’s kind of the point.
The bear market will end when it ends, and the bull market that rises from the ashes will be led by a new group of stocks.
McKinsey Group estimates that one emerging sector that generated $2 billion in revenue in 2023 could grow to $400 billion over the next decade.
If growth is even close to that estimate, well, there will be a massive bull market for the stocks in that sector.
I’m talking about Robo-Taxis. Hammer and I are very bullish. In fact, we just posted a brand new Special Report on the coming Robo-Taxi bull market. And it’s completely free to Outsider Club readers.
We encourage you to download your free copy of this exclusive Outsider Club report at your convenience.
And did I mention this report is absolutely free to you?
PS – the newest Outsider Club Chart Wars video is available on YouTube. Hammer reviewed a gold stock you might want to check out.
Cheers,
Briton Ryle
Chief Investment Strategist
Outsider Club
X/Twitter:https://twitter.com/BritonRyle
