저자: DanNiles · 외국인
요약 보기
AI 불안으로 소프트웨어 섹터 전반이 압박받는 상황. 소프트웨어는 AI에 잠식될 위험이 있어 단기 회복이 어렵다고 봄. 보안·데이터베이스는 상대적으로 견조하다고 평가. Palo Alto는 고밸류(PER 약 40배)에 인수 확대로 성장 둔화 여부가 불투명. Nvidia와 Broadcom은 하이퍼스케일러 capex 증가 수혜 기대, 다만 OpenAI 자금 조달·투자수익률(ROI) 우려가 존재. Amazon은 성장 둔화로 우려, Google 클라우드는 가속.
다듬은 글
We're back on Morning Trade Live, Palo Alto Networks will be in the spotlight this afternoon when the cybersecurity firm reports second quarter earnings. Analysts are expecting adjusted earnings per share of $0.93 on revenue of $2.58 billion. Shares though are down nearly 10% in 2026. We are under pressure today by the tune of 3 and 1/2% at 161.14.
Let's go inside out on Palo Alto Networks and the larger tech space. Joining us now, very pleased to say is Dan Niles, who is the founder and portfolio manager at Niles Investment Management. Uh thanks so much for your time today. Look, I mean are the markets, Dan, do you think going to be able to look past what we're seeing as far as the AI trade is concerned today when we hear from Palo Alto?
Yeah, I don't think so. I mean, here's the thing. It'll be interesting to see how Palo Alto reacts to earnings because what you've seen so far during earning season is even if software companies have had a good quarter, good guidance, that's not what investors are worried about. What they're worried about is how their business is going to look, you know, 3 to 5 years from now in the sense that is AI going to take over a large portions of what they do.
Now, and remember, software has been in favor really since you could argue Marc Andreessen wrote that piece for the Wall Street Journal in 2011 saying software is eating the world. And for the last 14 years, it's been a one-way trade higher for that sector. And so, it's got I think it's going to take some time.
You're not going to solve what AI is disrupting or not in 5 months, but I do think security and then databases are the two more resilient sectors within that. But in the near term, it's going to be kind of caught up with everything else, I think. Yeah, it certainly seems like it's getting caught up.
And I mean, it's just like a sell-off by association with some of these names. But what about Palo Alto Networks in particular, given that it's been so acquisitive, of course, with CyberArk and Cronus Sphere? What do we anticipate to hear on that front? Well, I mean I think you're going to hear them being very bullish as they always are.
But, you know, if you look at it from a valuation perspective, you can you can say, "Well, this the stock is trading at 40 times and it's growing revenue that mid-teens including these acquisitions." So, are they doing these acquisitions to be defensive and that growth is really slowing? Or is this really put them on the offensive?
And in this market, you know, people are shooting first asking questions later and it has to make you somewhat nervous on why are they doing what they're doing. Yeah, I've been reading about how some analysts do think that the AI disruption fears are perhaps a convenient headline, but there have been some of the valuations and bubble concerns sort of under the surface as well.
I'm just wondering with Nvidia, the next Mag 7 camp off the rank, what you anticipate to hear from it given that it's been interesting listening to these hyperscalers and the capex indigestion we've seen in these markets. Yet, chips have been rallying on the expectation that they're going to benefit from all this money.
So, what can we expect to hear from that name? Yeah, I think if you look at what we've seen in earning season so far, as you rightly pointed out Sam, before Q4 earnings got announced, people were thinking hyperscaler capex spending this year would be up 25 to 30%. Then you had all the companies report and if you do the math, it's closer to 60% now.
So, Nvidia, obviously, as the supplier to the hyperscalers should see some benefit from that because obviously expectations have gone up from closer to 30% to closer to 60% and that should benefit them. But, to be sort of covered, you can look at Broadcom as well because if you think, "Well, yeah, you're going to spend a lot more on CapEx, but you're going to get custom chips to do it instead of Nvidia micro Nvidia GPUs, then Broadcom should also benefit.
So, I think for investors that want to be invested in the space, you kind of need both because you do have hyperscalers doing custom as well as still buying from Nvidia, and those are really the two big companies in the space. Obviously, you have some smaller players that hope to take some share like an AMD or Cerebrus, which is private, but those are the really the two ways to play it.
Right. I mean, the markets seem to be having a really tough time right now, Dan, with the return on investment and seeing proof of that. And so, it very much feels like they're focused on the fact that these hyperscalers are just trying to win the race. Some people think that this perhaps is pointing to a misallocation of capital.
Do would you subscribe to that narrative? I mean, yes and [clears throat] no. I mean, not everybody's going to win, and I've been saying this for a very long time. And you can go back to kind of September of last year when the software index peaked. People really started to question number one, OpenAI, right?
They kind of started this whole AI race back when they introduced ChatGPT at the end of 2022, but then they had capital commitments of $1.4 trillion over eight years. And you look at that and you say, "How are they going to possibly be able to fund that when they're just doing 20 billion in exit revenues coming out of this last year?" And so, that's when people started to question this and all the circular deals, et cetera.
And so, that's why I think it's fair to say, "Hey, within all the hyperscalers, are all of these guys going to do well?" And you saw very different results from them. You look at Google, their cloud numbers went from 34% growth to 48% growth from quarter to quarter. Microsoft came in a little disappointing in that it went from 20 to 24, but then Amazon was the real problem where their growth actually decelerated from 39 to 38%.
And so, you combine that with everybody taking up CapEx forecasts with estimates not really changing and in some cases like with Amazon coming down, and I think it's justified that investors go what's the return on investment on on this for some of these players. Yeah, Amazon's getting hit hard uh certainly as far as that uh 9-day slide we've witnessed.
It's uh trying to make a bit of a comeback in the market today, but Dan, always appreciate your thoughts. Thanks so much for joining us today. That is Dan Niles, founder and portfolio manager at Niles Investment Management. Let's trade it now with Tom White, host of Fast Money. So, we're looking at Palo Alto Networks obviously set to report later on today.
As you heard there Tom, I mean Dan Niles not convinced that the market's going to be able to look past some of the AI disruption fears in this market as it's getting dragged down with the bonds, but what's an example trade for this one? Yeah, there's a lot of uncertainty. The disruption that AI is causing and a lot of people think a lot of these cybersecurity names are getting pulled down uh because the software names have.
Now, I'm sure AI is going to negatively impact some aspects of this company, but it's already pulled back about 28% from those recent record all-time highs. So, the bar's actually pretty low in this one going into the report. So, I looked at a strategy. If you think it's going to maybe pop, maybe it's a short-term pop, I looked at a short-term strategy that takes advantage of the differential uh between the volatility levels in different option series.
So, I looked at a bullish call diagonal. The option market's pricing it about a plus or minus $13 move either way in the shares. That's roughly about 8% either way uh in the stock. So, uh we're not to the March 6 weekly cycle that expires in 17 days and bought that at the money 160 strike call. And then against that in the near term, February 20th uh monthly options that expire in just 3 days, sold the 172 and 1/2 strike call.
So, a bullish 12 and 1/2 dollar wide call diagonal, you're going to pay roughly about 6.50 debit. Might be a trade in a little bit less than that right now, but the debit you pay is going to be your risk. So, a 12 and 1/2 dollar wide bullish call diagonal, you're paying about half the width of it. So, the low input cost price on it with the expectation that's going to go above maybe that break even of about 163, that's only a percent and a half above the current share price.
So, you don't need big monster move, but you're setting up for that one standard deviation move to the upside. Now, why is it cost less than the width of this call diagonal? It's 2 weeks wide on the call diagonal because you're buying about a 60% implied volatility on aggregate on that 160 strike call in March 6th weekly options, selling about 113% implied volatility in the near term February 20th monthly options on that 172 and 1/2 strike call.
So, setting up for one standard deviation move to the upside, taking advantage of that lower implied volatility on the options you're buying versus what you're selling. Okay, good look at Palo Alto Networks, which is under water today by a 3.3% We're looking ahead to those earnings later on. Tom, thanks so much for the example trade this morning for us. All right, that is going to do it for us here on Morning Trade Live.
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