Sometimes the stakes are so high, the degree of difficulty so immense, that it simply may be too hard to game. When that’s the case, no amount of formal research will help you fathom the stock implications. Yet, you have inherited the issues and they must be dealt with — or you are too at sea to judge them. We have not one, but two situations — and potentially three — that concern me especially because the price-to-earnings multiples are very high. The two stocks in question? Broadcom and Costco . Broadcom, the nervous system for many of the hyperscalers, is trying to encroach upon fellow Club name Nvidia , the leading AI chipmaker whose fast processors are at the heart of so many artificial intelligence data centers. Let’s take Broadcom first. For its custom AI chip business, Broadcom’s list of clients include Alphabet -owned Google, Meta Platforms , TikTok parent ByteDance, and OpenAI . Additionally, AI startup Anthropic also was recently revealed as a $10 billion customer . Meanwhile, Broadcom is rumored to be talking with Microsoft about shifting its business away from its director competitor in the custom chip design space, Marvell Technology . And there were also concerns that Marvell was losing some business from Amazon. Importantly, Marvell CEO Matt Murphy, whom I trust implicitly, came on “Mad Money” and said he hadn’t lost any business. I believe him. At the same time, Bloomberg News on Friday reported that Oracle pushed back the opening date for some of the data centers it’s building for OpenAI, the giant startup run by Sam Altman. OpenAI happens to be committed to spending $300 billion over five years for computing power from Oracle. That figure is thought to be rock solid because it is in Oracle’s RPO, or remaining performance obligations. It represents more than half of Oracle’s $523 billion RPO. Anything that indicates that OpenAI is not money good could cause a tremendous negative ripple for this entire ecosystem — not just OpenAI, although OpenAI is at the center of the debate. According to Bloomberg, the timeframe for the pushout is from 2027 to 2028, with labor and material shortages cited as the reason. Importantly, Oracle said in a statement there have been “no delays to any sites required to meet our contractual commitments, and all milestones remain on track.” Oracle is to be trusted because it is Larry Ellison’s company and Ellison doesn’t make false claims. But is Sam Altman to be trusted? We don’t know enough about him and his company is private. Bloomberg could be wrong in its story. But maybe it isn’t. Many took the story as gospel despite Oracle’s response in that statement. It is possible, however, for everyone to be right. We know from Coreweave’s quarterly report that these sites can have problems being built . They are very complicated and companies are all fighting for the same components. Oracle holds itself out as an expert in building them. What happens, however, if…
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