TOP 5 STOCKS TO WATCH THIS WEEK
In a Nutshell
Markets are at all-time highs but face inflation risk from Tuesday's CPI report and Wednesday's PPI. The video warns against speculative AI stocks like NBIS and Oklo trading at extreme multiples with no fundamentals, alongside Hims losing market share and Robinhood/SoFi vulnerable to economic slowdowns. Core takeaway: use strict position sizing and risk management rather than leveraged products, as most AI companies will fail while only a few top players survive.
These notes were generated by AI and may contain inaccuracies.
The market has hit all-time highs multiple times recently. From the end of March through all of April was incredibly bullish, and the first week of May was also incredibly bullish. Iran has rejected the deal with the US, causing markets to sell off initially before recovering. Markets celebrated and pushed to new all-time highs when a deal was pending, but remained green after rejection. This week's outlook may differ due to scheduled economic reports rather than earnings.
Monday: Existing home sales, scheduled 30 minutes after markets open. Tuesday: CPI (Consumer Price Index) data report, scheduled 1 hour before markets open. Wednesday: PPI (Producer Price Index) report covering inflation on the production side.
The CPI report is particularly influential to the overall market. Inflation has been rising. A new Federal Reserve head is expected Monday or Tuesday. Key questions include whether inflation can approach 4% (moving from 3.3% to 3.7%), and whether markets can ignore inflation nearing 4%. The Federal Reserve's 2% inflation target is noted as context.
NBIS was one of the top performing stocks for 2025, rallying to highs of $135, crashing to sub $80 per share, then experiencing a second leg up to highs of $166, pulling back to build ascending support, running to nearly $200, and now pulling back again. NBIS reports earnings Wednesday before markets open. Based on fair value and analyst targets, there is 32% downside. It trades at a PE ratio of 4,625 times its earnings. NBIS is described as incredibly cheap on this metric.
NBIS is a speculative stock, not a value play. The company builds full stack infrastructures for AI including large-scale GPU clusters, cloud platforms, and tools. It has a strategic alliance with Nvidia to expand its cloud infrastructure, which contributed to a leg up from $90 lows to $160 highs. Fundamentally, it is not positioned as a good deal. From highs of $140 to sub $80 lows, it dropped 47% in 50 days. Position sizing and risk management are emphasized for those considering entry before earnings.
Oklo has been destroyed, moving from highs of nearly $200 down to $50, losing over 50% of its value. Using a trend line from $190 highs to sub $50 lows shows a 74% loss. There is 30% downside based on average fair value analyst target of $50 per share. Oklo trades at a negative 119X PE ratio and lost $105 million. The company makes no revenue and does not plan to make revenue until 2029.
Oklo is an alternative energy company developing fission power plants but has no active or real reactor yet. The company is in early development stages. The stock was pumped up during an irrational period despite lacking fundamentals. If markets correct, Oklo will crash completely as its valuation is unsustainable.
Hims ran up to highs of $70 then crashed, ran to $60 highs then crashed repeatedly. It was recently destroyed and is attempting to pump again. Fundamentally, Hims had a 50 PE ratio last check - not cheap but not at its highest multiple. Fair value analysts indicate 90% downside.
Hims revenue has been fair, but market share is being lost to competitors. Hims became popular selling erectile dysfunction drugs with modern marketing but lacks competitive edge. The company is not unique compared to others in the space. Hims incorporated AI messaging into its narrative, trading at AI company multiples despite being a pharmaceutical company. The stock has been terrible performing for the past year after being a top performer in 2025.
Markets are incredibly irrational, with stocks running up 20% then another 10% even without strong earnings. Semi stocks like SanDisk, Micron, and Intel are mentioned as examples. The concern is that not all will be winners - one main winner will take majority space while others fall. Trump continues encouraging buying while markets remain irrational. Shorting is cautioned against without experience managing risk, as markets can continue pushing higher.
Leveraged products like SOXL are not recommended at current elevated levels. One-for-one exposure is preferred over double or triple leverage. Beginners often lack position size management skills and get too confident after bull run gains. One bad trade can wipe out gains, especially when accounts are largest. Risk management is emphasized as the key takeaway rather than sexy strategies.
Position sizing should be calculated - not going all in. For a $10,000 account, $1,000 (10%) might be appropriate. Risk-reward ratios should favor winning over losing. Trade plans should include entry points, exit targets, and stop losses. Risk is not the enemy, but unmanaged risk is.
Disney has been struggling and unable to break above $125 resistance. The stock has established support but trades within a consolidation range with no break of pattern. Recent push could lead to short-term pullback. Disney was purchased for a four-year-old's investment account when cheap, but additional buying is not recommended at current levels. Consumer sentiment decline, rising inflation, and potential Federal Reserve rate hikes could impact performance. In 2022, Disney fell from nearly $200 highs when inflation peaked at 40-year highs and rates rose aggressively.
Robinhood is not considered cheap. Revenue is expected to slow for 2026. Robinhood and Coinbase struggle during economic slowdowns as they make money through payment for order flow. They have nice runs during bull markets but peak and crash hard afterward.
SoFi is not of interest. ServiceNow was performing well but faces competition concerns in AI space. The stock dropped from $240 to lose 61% of value. Despite the 60% drop, the PE ratio remains at 53 times earnings - still overvalued rather than undervalued.
Revenue and net income concerns are mounting for certain AI companies that may struggle to grow and compete effectively. During bull runs when everything appears unstoppable, competition can suddenly emerge that presents potentially better options, prompting investors to pull out and triggering disappointment-driven declines. One such stock has fallen 60% as competition intensified in an increasingly saturated market. It's easy to feel like a winner in the beginning, but not all AI companies or servicing companies will be winners—very few of them are. They can ride the wave because they're partaking in that sector with excitement and investment, but eventually fundamentals will matter. In successful niche spaces, there are typically just a few top dogs while the rest fall way behind.
Top companies will always trade at somewhat of a premium with higher P/E ratios because they've earned it. The rest will fall behind, and this appears to be what's happening with some companies. There may be hopes of turnaround stories, but there's no confirmation of a reversal. If nothing is showing excitement in recovering, there's no reason to care. A stock may have lost significant value and could appear cheap, but just because something is overpriced doesn't mean it can't go higher, and just because something is cheap doesn't mean it can't go lower.
When considering investments in established storage firms like Micron, SanDisk, Western Digital, and STX, questions arise about investing in companies like ServiceNow or CRM. However, SanDisk's position isn't necessarily solidified—ServiceNow investors likely felt the same confidence when hitting new all-time highs repeatedly. Companies that have run up 1,000% or 4,000% in a single year haven't historically avoided corrections or crashes. SanDisk is fundamentally a storage company dealing with memory cards and AI storage, which is experiencing demand boost, but similar excitement was seen last year with Oak Street, Hims, and OpenDoor, all now down 50%.
Meta appears to be one of the few Magnificent 7 companies falling behind, not close to previous all-time highs and approaching support while markets continue pushing higher. Money appears to be pulled out of Meta and redirected into SanDisk, Intel, Micron, and AMD. This resembles a rebalancing where funds are being extracted from companies that were pushed to super inflated levels, while smaller companies attempt to catch up. Meta may be a safer play but could also be somewhat overpriced with significant speculation already priced in.
Meta and Microsoft are lagging behind their Magnificent 7 peers. This week's earnings include Circle, Hims, QBTS, Oaklo, and NBIS. More importantly, the CPI report releases Tuesday one hour before market opens, followed by the PPI report on Wednesday. A free live stream of the CPI report will be available on YouTube.
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