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U.S. stock exchanges are home to eight companies with a valuation of at least $1 trillion:

1. Apple: $3.59 trillion.

2. Nvidia: $3.52 trillion.

3. Microsoft: $3.11 trillion.

4. Alphabet: $2.02 trillion.

5. Amazon: $1.98 trillion.

6. Meta Platforms: $1.45 trillion.

7. Taiwan Semiconductor Manufacturing: $1.04 trillion.

8. Berkshire Hathaway: $1 trillion.

Apple was the founding member of the exclusive $1 trillion club in 2018. Warren Buffett‘s Berkshire Hathaway and Taiwan Semi are the newest members, having joined in the last few months. And despite only joining in 2023, Nvidia has leapfrogged tech giants like Microsoft to become the second-most valuable company in the world, thanks to soaring demand for its artificial intelligence (AI) data center chips.

I predict one more company is about to join them. Broadcom (NASDAQ: AVGO) has a market capitalization of $840 billion as of this writing, following an incredible 527% gain in its stock over the last five years. Like Nvidia, Broadcom is experiencing incredible demand for its AI data center hardware, and that could be the company’s ticket to the $1 trillion club in 2025.

Broadcom stock only needs to gain another 19% to get there, and with two full months remaining in 2024, I’m not discounting the possibility that it could cross the $1 trillion milestone before the new year. But here’s why I think 2025 is a more realistic target.

Broadcom has a history of innovation that spans decades. It pioneered everything from optical mouse sensors for computers to fiber optic transmitters for data communications. However, starting in 2016, it evolved into far more than a semiconductor and electronics company.

That was the year Broadcom merged with chip giant Avago Technologies. Since then, it has spent nearly $100 billion acquiring other companies, including semiconductor equipment supplier CA Technologies, cybersecurity giant Symantec, and cloud software provider VMware. Each of them contributes to Broadcom’s growing portfolio of AI products and services.

On the hardware side, Broadcom is having incredible success supplying custom AI accelerators (a type of chip used for processing AI workloads) to hyperscale customers — which typically includes Microsoft, Amazon, and Alphabet. During the recent fiscal 2024 third quarter (ended Aug. 4), Broadcom said sales of its AI accelerators surged by three and a half times compared to the year-ago period.

The company also supplies Ethernet switches for data centers, which regulate how quickly information travels between chips and devices. Many AI data centers cluster tens of thousands of graphics processing units (GPUs) or accelerators together. High-quality networking equipment ensures developers can build AI models at the fastest speed possible, which also keeps costs down.

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Broadcom said sales of its Tomahawk 5 and Jericho3-AI Ethernet switches grew fourfold (year over year) during Q3. That isn’t surprising given the strength of its accelerators business, and Nvidia’s GPU business, for that matter. Tech giants are spending tens of billions of dollars building AI data centers right now, which is a powerful tailwind for Broadcom’s networking equipment.

Broadcom generated $13.1 billion in total revenue across all of its businesses in Q3, which was a 47% increase from the year-ago period. Of that, $3.8 billion was attributed to the inclusion of VMware’s revenue. Broadcom closed the acquisition of that company in 2023, and only started reporting its revenue on a consolidated basis this year, which is temporarily inflating its total revenue growth.

Broadcom said AI products and services contributed $3.1 billion to its overall revenue during the quarter, and that could be the fastest-growing part of the entire organization going forward. In the upcoming fourth quarter, Broadcom expects to deliver $3.5 billion in AI revenue. This will represent a sequential increase of over 10%, compared to forecasted sequential growth of just 6.8% for its total revenue overall (which is expected to come in at $14 billion).

Broadcom is on track to generate a record $51.5 billion in total revenue for fiscal 2024. The company originally expected AI to account for $11 billion of that figure, but the segment has been so strong that management recently increased its forecast to $12 billion.

Broadcom isn’t consistently profitable on a GAAP accounting basis, so we can’t use the traditional price-to-earnings (P/E) ratio to value its stock. However, we can use the price-to-sales (P/S) ratio, which divides the company’s market capitalization by its trailing 12-month revenue.

Based on that calculation, Broadcom’s P/S ratio is currently 17.6. To be clear, that is not cheap — it’s close to double the stock’s average P/S ratio of 8.9 over the last five years.

However, Broadcom’s strong AI growth under the surface of its total revenue is enticing investors to pay a premium for its stock. As I mentioned, Broadcom only has to gain 19% from here to join the $1 trillion club, so if its P/S ratio remains constant, it simply has to grow its revenue by 19% in fiscal 2025 (which begins in December this year) to get there.

Wall Street expects Broadcom’s revenue to grow by 17.5% in fiscal 2025, which is in the ballpark. However, since the company raised its fiscal 2024 AI revenue forecast by a whopping $1 billion last quarter alone, there is a very strong possibility that the Street’s estimate for next year is low.

Nvidia CEO Jensen Huang believes data center operators will spend $1 trillion building AI infrastructure over the next five years. If he’s right, I think there is a good chance Broadcom will blow away all expectations in 2025.

The key risk in my prediction is that Broadcom’s P/S ratio could shrink because investors become averse to stocks with high valuations, which could add years to its journey toward the $1 trillion club. That’s something to keep in mind before buying in. But as long as investors maintain a long-term horizon of five years or more, they still have the potential to do very well in this stock.

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John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to Meta Platforms CEO Mark Zuckerberg, is a member of The Motley Fool’s board of directors. Anthony Di Pizio has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Alphabet, Amazon, Apple, Berkshire Hathaway, Meta Platforms, Microsoft, Nvidia, and Taiwan Semiconductor Manufacturing. The Motley Fool recommends Broadcom and recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy.

Prediction: 1 Unstoppable Stock Will Join Nvidia, Apple, Microsoft, Amazon, Alphabet, and Meta in the $1 Trillion Club In 2025 was originally published by The Motley Fool

General Motors (GM) gave investors something to cheer early Tuesday morning after the automaker raised its guidance for a third time this year, in addition to easily beating third quarter revenue and profit expectations.

For the quarter, GM reported revenue of $48.78 billion, easily topping estimates of $44.69 billion per Bloomberg consensus and higher than the prior quarter’s nearly $48 billion. GM’s Q3 revenue was also 10.5% higher than a year ago.

The company booked adjusted earnings per share of $2.96, far outstripping expectations of $2.44. It reported EBIT-adjusted profit of $4.115 billion, up 15.5% from a year ago, with EBIT-adjusted margin climbing to 8.4% from 8.1% year over year.

GM stock jumped nearly 8% in early trading.

In terms of guidance, GM made the following upward revisions to its full-year 2024 forecast:

• Adjusted EBIT (earnings before interest and taxes): $14 billion to $15 billion ($13 billion-$15 billion previously)

• Automotive operating cash flow: $22 billion to $24 billion ($19.2 billion-$22.2 billion previously)

• Adjusted automotive free cash flow: $12.5 billion to $13.5 billion ($9.5 billion-$11.5 billion previously)

• Diluted-adjusted EPS: $10 to $10.50 ($9.50-$10.50 previously)

“I’m proud that GM is delivering our best vehicles ever with strong financial results. But I want to be clear that we are not mistaking progress for winning,” GM CEO Mary Barra wrote in her letter to shareholders. “Competition is fierce, and the regulatory environment will keep getting tougher. That’s why we are focused on optimizing our ICE [internal combustion engine vehicle] margins and working to make our EVs profitable on an EBIT basis as quickly as possible.”

GM CFO Paul Jacobson added in a media call with reporters that while the reduction of GM’s share count by 19% via buybacks provided a “tailwind” to the EPS beat, the profit beat was due more to the earnings power of the company’s fundamental business.

Jacobson told Yahoo Finance the company would stay aggressive on buybacks in 2025.

In Q3, GM delivered 659,601 vehicles, down 2% compared with a year ago; however, retail sales were up 3%. GM said it delivered more vehicles than any other automaker in the US in the quarter.

Not surprisingly, GM’s sales of pickups and full-size SUVs led the way, but electric vehicle sales were also a highlight. Amid a drop in sales for the Bolt EV, GM’s other EV models picked up the slack with sales of 32,195 EVs in total, up 60% compared to a year ago.

Jacobson said at GM’s investor day in early October that the company is still targeting EV profitability on a positive variable profit margin basis, despite the fact that it revised its EV production volume forecast to 200,000 units, at the low end of its previous range of 200,000 to 250,000 units. The company is expecting to trim EV costs by $2 billion to $4 billion in 2025.

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In the media call, Jacobson elaborated on why variable profit was so important. “Variable profit is a really important step on the journey to profitability. It means you reached an inflection point,” he said, where scaling up sales starts to eat into high fixed costs. “As we scale, our EBIT losses start to come down,” he added.

During its investor day, GM indicated that the peak EV losses in 2024 will “help [in] upcoming years as we expect EV EBIT to improve significantly.”

Looking ahead, Barra said GM expects 2025 adjusted EBIT to be in a similar range to the full-year 2024 results, as the company said during its investor day.

Pras Subramanian is a reporter for Yahoo Finance. You can follow him on X and on Instagram.

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COLLEGE PARK, Md., Oct. 22, 2024 /PRNewswire/ — As housing affordability has become a major issue for many Americans, a new survey by the Program for Public Consultation (PPC) in six swing states and nationally finds majority support – bipartisan in most cases – for the Federal government taking a variety of actions to make housing more affordable, especially for low and middle-income households.  These include:

• providing billions in grants and tax incentives for building and repairing affordable homes
• providing down payment assistance to first-time buyers
• reducing large corporate ownership of houses
• incentivizing local governments to reduce single-family zoning restrictions
• increasing the number of public Housing Vouchers

Steven Kull, Director of PPC noted, “In the swing states, bipartisan majorities want the Federal government to pursue an active and multi-pronged approach to deal with the high cost of housing.”

This survey is the tenth, and last, in a series – the Swing Six Issue Surveys – being conducted in the run-up to the November election in the swing states of Arizona, Georgia, Michigan, Nevada, Pennsylvania and Wisconsin, as well as nationally, on major policy issues. Unlike traditional polls, respondents in a public consultation survey go through an online “policymaking simulation” in which they are provided briefings and arguments for and against each policy proposal. All Americans are invited to go through the same policymaking simulation as the survey sample. [More Detailed Report]

New Federal Spending and Tax Incentives for Affordable Housing
Respondents were informed that the Federal government currently provides some funding and tax incentives for building more affordable homes, mostly for low-income households. They were told that housing is considered affordable when it costs the household no more than 30% of their income to live there.

They then evaluated a series of proposals for the Federal government to do more to increase the supply of affordable homes. Each one is favored by bipartisan majorities in every swing state and nationally. 

• $40 billion to build or repair housing affordable to very low and low-income households, through 1) grants to cities and states, and 2) support for more low-interest loans to home builders, is favored by majorities in every swing state (69-73%). This includes majorities of Republicans (57-63%) and Democrats (79-89%). Nationally, a bipartisan majority is in favor (74%, Republicans 63%, Democrats 86%). [BAR GRAPH]
• $25 billion to build or repair housing affordable to low and middle-income households, through grants to cities and states, is favored by 66-73% in the swing states, including majorities of Republicans (54-60%) and Democrats (80-86%). Nationally, a bipartisan majority is in favor (71%, Republicans 57%, Democrats 88%). [BAR GRAPH]
• A tax credit for building or repairing housing to be rented, on the condition that 60% of them are affordable to middle-income households, is favored by 69-73% in the swing states, including majorities of Republicans (56-64%) and Democrats (79-86%). Nationally, a bipartisan majority is in favor (73%, Republicans 63%, Democrats 85%). [BAR GRAPH]
• A tax incentive for building or repairing housing that is affordable for low and middle-income people to purchase–specifically in low-income, non-urban areas–is favored by 64-68% in the swing states, including majorities of Republicans (54-61%) and Democrats (73-79%). Nationally, a bipartisan majority is in favor (67%, Republicans 59%, Democrats 77%). [BAR GRAPH]

$25,000 Down Payment Assistance for First-Time Homebuyers
Providing assistance–up to $25,000–to help first-time homebuyers cover the down payment on a home, with more assistance for people whose parents never owned a home, is favored by majorities in every swing state (63-68%), including majorities of Democrats (81-87%). Among Republicans, a majority is in favor in Georgia (54%), views are closely divided in Arizona, Nevada, and Pennsylvania, and less than half are in favor in Michigan and Wisconsin (43-44%). Nationally, 67% are in favor, including 84% of Democrats, and a bare majority (52%) of Republicans. [BAR GRAPH]

Reducing Large Corporate Ownership of Houses
Respondents were informed that some experts believe the increase in large corporations purchasing houses accounts for some of the rise in home sale prices, while other experts do not. Two proposals for reducing large corporate ownership are favored by bipartisan majorities in the swing states and nationally:

• Requiring corporations with more than $50 million in assets to sell all their single-family houses, townhouses and duplexes within the next ten years, and prohibit them from buying any more, with substantial financial penalties for non-compliance, is favored by 66-71% in the swing states. This includes majorities of Democrats in each state (75-81%), as well as majorities of Republicans (57-63%) in every state except Wisconsin which is statistically divided. Nationally, a bipartisan majority of 67% is in favor (Republicans 55%, Democrats 81%). [BAR GRAPH]
• Denying corporations that own more than 50 single-family houses, townhouses or duplexes any Federal tax deductions related to their ownership of those houses (e.g. for mortgage interest or depreciation), is favored by 67-71% in the swing states. This includes majorities of Republicans (55-66%) and Democrats (78-81%). Nationally, a bipartisan majority of 71% is in favor (Republicans 61%, Democrats 82%). [BAR GRAPH]

Federal Incentives for Cities to Reduce Single-Family Zoning, and Allow More Dense Housing
Respondents were informed that, according to experts, one reason that housing has become less affordable is that local governments restrict building dense and mixed-use housing. They were told that the Federal government – when distributing funding for infrastructure repair – has started giving priority to local governments that allow more dense and mixed-use housing.

Asked whether they favor the Federal government continuing that policy, a majority in every swing state is in favor (55-61%), including majorities of Democrats (71-74%). Among Republicans, less than half are in support in Arizona, Georgia, and Pennsylvania (41-43%), while views are statistically divided in Michigan, Nevada and Wisconsin. Nationally, 64% are in favor, including 80% of Democrats, while Republicans are statistically divided (51% favor, 49% oppose).

Asked whether they would favor their own local government allowing for the construction of more dense and mixed-use housing, 61-70% are in favor in the swing states, including majorities of Democrats (79-83%). Among Republicans, majorities are in favor in Georgia, Nevada, Pennsylvania and Wisconsin (53-56%), while views are statistically divided in Arizona and Michigan. Nationally, a bipartisan majority of 68% are in favor (Republicans 54%, Democrats 84%). [BAR GRAPH]

Additional $24 Billion In Public Housing Vouchers
Respondents were informed that the government provides people who qualify for public housing – very low-income, disabled or elderly people – with Housing Vouchers that help cover rent in the private housing market. Majorities of 69-72% favor increasing the number of people who can receive Housing Vouchers by spending an additional $24 billion for that purpose, including majorities of Democrats (78-88%). Among Republicans, majorities are in favor in Arizona, Georgia, Nevada and Pennsylvania (58-64%), while they are statistically divided in Michigan and Wisconsin. Nationally, a bipartisan majority of 74% is in favor (Republicans 63%, Democrats 87%). [BAR GRAPH]

About the Survey
The surveys were fielded October 4-14, 2024 to a representative non-probability sample of 4,638 adults by the Program for Public Consultation at the University of Maryland’s School of Public Policy, including approximately 600 adults in each state of Arizona, Georgia, Michigan, Nevada, Pennsylvania and Wisconsin, and 1,190 nationally. Samples were obtained from multiple online non-probability panels, including Cint, Dynata and Prodege. Sample collection and quality control was managed by QuantifyAI under the direction of the Program for Public Consultation. Samples were pre-stratified and weighted by age, race, ethnicity, gender, education, income, and metro/non-metro status to match the general adult population. The national sample was also weighted by marital status and home ownership. The national and most state samples were further weighted by partisan affiliation. The survey was offered in both English and Spanish. The confidence interval for the national sample is +/-3.2%, and for the state samples it ranges from +/-4.5% to 4.6%.

About UMD’s Program for Public Consultation
The Program for Public Consultation (PPC) at the University of Maryland’s School of Public Policy, develops and conducts public consultation surveys, seeking to improve democratic governance by consulting representative samples of citizens on key public policy issues. It shares its findings with officials in government, the media, other academics, and the general public.

View original content to download multimedia:https://www.prnewswire.com/news-releases/in-swing-states-bipartisan-majorities-favor-federal-government-actions-to-make-housing-more-affordable-302282096.html

SOURCE Program for Public Consultation

While gold prices have repeatedly set fresh record highs this year, silver has been rallying as well — with one analyst predicting that prices for the precious and industrial metal will reach $40 an ounce or more before the end of the year, as supplies continue to come up short of demand.

Fundamentally, silver “has all the right ingredients” for a “melt-up move,” said Peter Spina, president and founder of GoldSeek.com, a website that has provided investors with gold prices, research and information for nearly 30 years.

“As gold tears higher to new records, the buying pressures on silver grows, as does the fourth year of supply deficits,” he told MarketWatch. The Silver Institute forecasts 2024 total global silver supply at nearly 1.004 billion ounces, compared with total demand of 1.219 billion ounces, following supply deficits in 2021, 2022 and 2023.

On Monday, the December contract for silver futures SI00 SIZ24 climbed 66.1 cents, or 2%, to $33.895 an ounce on Comex. Based on the most active contract, prices are poised for their highest settlement since Nov. 29, 2012, according to Dow Jones Market Data. They are trading around 41% higher this year to date.

“Silver is making a major move now and it is going to get noticed by more investors and speculators,” said Spina. “This means to me that the next move higher in silver prices will be aggressive with $40-plus an ounce on the horizon, likely before year’s end.”

That would lift silver futures closer to their all-time settlement high of $48.70 from Jan. 17, 1980. Prices set an intraday record high at $50.36 on Jan. 18, 1980.

The climb in gold prices has taken center stage, climbing on Monday to a fresh all-time intraday high of $2,755.40 an ounce, and the yellow metal’s rise is making “silver look cheap,” Spina said.

December gold GC00 GCZ24 was at $2,736.40 an ounce in Monday dealings.

Read: Gold’s record-breaking run comes as stocks hit fresh highs. Is it too late for investors?

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(Reuters) -Taiwan Semiconductor Manufacturing Company (TSMC) said on Tuesday it has informed the United States of a potential attempt by Huawei to circumvent U.S. export controls prohibiting the chipmaker from producing AI chips for the Chinese company.

The U.S. government restricted the export of high-end AI chips to China two years ago, citing the need to limit the Chinese military’s capabilities.

“We are not aware of TSMC being the subject of any investigation at this time,” the company said in a statement, adding that it has not supplied to Huawei since mid-September 2020. TSMC’s U.S.-listed shares were down 1.5%.

A crucial element of export controls is a rule prohibiting global chip manufacturers from utilizing U.S. technology or equipment to produce chips intended for Huawei or its products.

In recent years, the United States has escalated its use of export controls, aiming to thwart Chinese companies from obtaining, designing, or manufacturing advanced semiconductors.

Huawei, a primary target of these efforts, epitomizes the growing technology rivalry between Beijing and Washington.

TSMC informed the U.S. Commerce Department after a customer placed orders for a chip similar to Huawei’s Ascend 910B, a processor designed for large language model training, a Financial Times report said earlier in the day, citing people familiar with the matter. The Commerce Department and Huawei did not immediately respond to Reuters requests for comments.

(Reporting by Karen Freifeld in New York and Akash Sriram in Bengaluru; Editing by Shinjini Ganguli)

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