The AI Sell-Off Is Over: I'm Buying These 5 Stocks Now

But what if this market selloff is actually the buying opportunity we've been waiting for? With AI and tech stocks taking a beating, inflation concerns rising, and investors growing increasingly nervous, fear is taking over Wall Street. But while the sentiment is bearish, Luke's looking for opportunities. So Luke, we got five stocks on the table. Um, I want you to give us an overview on all of these. So let's start up with one of the channel favorites Nebius. >> Yeah. So I think the recent AI selloff is an opportunity, obviously. Um, and I think that the sell-off is turning into a rebound cautiously this week and will continue. I think strong earnings will be a very big uplift for the AI complex. Not saying today is the bottom or tomorrow is the bottom or this week is the bottom, but I think we're bottom enough to start looking for really good opportunities and the charts tell me there's some really good opportunities out there. And so, yeah, I got five stocks that I think at the top of my dip buying list based on short-term setups. Number one is Nebius. Obviously, Nebia has got hit super hard uh by the coreweave um kind of nonsense that's been going on. Core has been blowing up or their debts been blowing up and people are really worried about that. But Nebius is is not coreweave. Coreweave is way more levered. Coreweave has way less of uh cash on its balance sheet relative to its market cap. It's got way more net debt. Uh it's just a way more risky play on uh compute infrastructure. I'm still bullish on comput infrastructure. I think that the credit concerns over it. Coreweave have unnecessarily and uh unw warrantedly spilled over into Nebia is creating a really good opportunity. Uh like I said, the balance sheet's much cleaner. The growth is much bigger. This is a company that's going to grow. Evid 100% compounded annual growth rate into 2030 and it's trading at just let me pull up the number. It's trading at just nine times forward. So that's like the most attractive valuation growth setup you could imagine trading at nine times forward for 100% compounded annual growth rate on Ebidov for the next 5 years, four years. That's just ridiculous. And you look at the chart and I think the chart's ready to go. So this is a stock that dipped to its 200 day moving average is bouncing now retaking that 200 day or trying to retake the 20 173 200 days of 174. You got an oversold RSI bounce. You got a MACD that's really low and and about starting to curl higher and reconverge. This to me just has all the signs of a textbook rebound play. Fundamentally, I love the stock. So, I think Nebius is at the top of my dip buying list right now. >> Yeah, definitely. It look it looks like that stock is rebounding today. So, you know, fingers crossed that continues onward. Uh, next up we have Micron Technology. So, that is one of the few on this list that are up just a bit since the uh the sharp falloffs last week. >> Um, well, Micron got hit super hard last week. Uh, it's rebounding a bit today. the whole AI trade rebounding a bit today. So it it's not rebounding any more than anything else really. Uh but it is rebounding. Uh I like Micron here because the big debate around the longevity of the memory cycle I think will well resolve positively for the bulls and negatively for the bears. I do not see spending slowing. I do not see the buildout slowing. I think credit concerns are a bit overblown. Uh I think that therefore the demand for memory will continue. I think something you have to remember is that these credit concerns were really brought up because uh Treasury rates are moving higher. That that's a geopolitical phenomenon which I think fades that I do believe that post midterms we do get some sort of resolution in the Middle East, some sort of calming of tensions. I got a headline last night that Putin's trying to call a meeting with um the US and China to end the Ukraine war as well. So, we could get two major geopolitical resolutions in the next month or so that allow for uh interest rates to head meaningfully lower. And if you take that 10 year from 5.3 down to 4.5, then all of a sudden these credit concerns just kind of go out the window. People aren't concerned about credit anymore. And all of a sudden, the the cost of of financing the AI infrastructure boom, those concerns become null. And then you get the names that were hit the hardest get big big big big rebound. So, Nebius obviously number one there. Um, but Micron to me because it's the most cyclical, memory is the most cyclical, I think it's one that is going to bounce back the most as well. Uh, right now I think if you look at the earnings for it, they're calling for peak earnings in like 2027, 2028. I think that gets pushed out to 2029, 2030, 2031. I do not see earnings peaking in memory for the next few years. And if that's true, then the fact that the stocks, look at the the modeled peak right now is 205.31 on EPS in fiscal 2028. So peak is uh about 24 months out is kind of what they're saying. I think it's more like 48 months out or even further out than that. Uh 60 months out. So I think that we got a lot of time before the peak. And if that's true and the current multiple on it, I think we're at like four times IDA or something like that. Let me see something super cheap. Yeah, we're uh four times Ebata. Yep, four times Ebata. So if indeed I'm proven right that the peak is still four years out, five years out, this is a stock that rebounds really nicely and you look at the chart and it's a chart that also looks really good. Got oversold and nearly oversold now it's bouncing back still above an upward sloping 20day moving average. I think this is a stock that's really ready to rock. So I like Micron here >> 100%. Yeah, it feels like this upcoming earning season is going to be the most pivotal in terms of kind of retaining the uh the AI market where it is, right? Yeah, we and we'll talk about it more in the macro podcast, but I don't really give a crap about what Micron reports. I don't give a crap what Nebus reports. I don't think that matters. What matters is what the hyperscalers report in terms of their capex guidance for sure. >> Um, right now I would say the market is going into the earnings season pricing in capex cuts. >> Got it. >> And if we don't get capex cuts, I think then that's the absence of bad news is good news and that lights a fire and that would be a big fire lit for Micron. >> Interesting. Okay, next up is Marll. So that is one of the companies you said is going to be your top three for 2027. >> Yeah. So Marll. So like my top three for 2027, like I said last week was Nebius, ARM, and Marll. This week we're kind of talking about the short-term setups. Nebius and Marll have great short-term setups. So does ARM, but it didn't make the top five for me. Uh the Marll short, I mean the long-term game is simple, right? Inferencing is the shift. Agentic AI is the shift. Marll wins with both their business lines from that shift because custom silicon becomes super important with more inferencing because hyperscalers need costefficient inferencing that if you get more and more inferencing they can't run expensive inferencing on expensive chips because then the costs get out of control so they need to do custom silicon to get costefficient inferencing and so custom silicon becomes a really big thing. Marll's a leader there. Marll also does networking. Inferencing means lots of talking, lots of communicating amongst chips, lots of traffic on those highways. You need better networking, you need more optics, upgrade copper, two optics, put more optics everywhere. Their inferencing business wins big there. So, or their networking business wins big there. So, Marll's got a really powerful one-two growth punch. They just, you know, had that big guidance beat. They had that big long-term target raise. So, management's really, really confident right now. And the chart looks really good. But I got a stock that's uh on a clear uptrend, dipped below its upward sloping 100 day moving average and today is retaking it. The 100 day was at 241. We got that 17 point bounce at 245 246. We're retaking it. Uh RSI got pretty low. MACD is reconverging. To me, this looks like a stock that's ready to to rebound nicely. I really like the short-term setup to Marbell. >> 100%. Love it. Yeah, that is one of the ideal picks and shovels. Uh so next up, let's go to Astera Labs. Another interconnectivity play. >> Yeah. So again, yeah, ALAB is is a connectivity play. You could call it wiring the rack scale AI brain, right? Um, agentic models, they run across dozens of accelerators, uh, acting as one system. The chips connecting them become the bottleneck. Marbell supplies some of that. Astera labs supplies some of that. Astera Labs thing about them is that they're all that, right? So that's what they do. They do the connectivity, they do the switches. Um, they are all in on that networking thing. We're really big on the agentic AI shift creating more inferencing which means more networking demand. So a company like ALAB is going to win big. This is one of the fastest growing players in the space. If you kind of look at the uh the growth estimates on this on this bad boy pulling them up right now. Astero is going to grow revenues. We got 121% expected this year. 65% growth expected next year. 29% 2028. 43% 2029. 23% 2030. So this is a a big compounded revenue grow. Revenues growing from 1.9 billion this year to 7 billion by 2030. Massive growth there. EB dot margins are expected to go from 36% to 48% by 2029. Eat going from 674 to 2743. EPS going from four bucks to 15 bucks basically. So five-fold increase uh in EPS. So this is a massive growth story and it's trading at a really compelling valuation for that growth. you're talking about. I mean, I think the compounded EBA dog growth rate on this bad boy is going to be uh about 50% over the next few years. And it's trading at 45 time forward. So 50% EBIT grower, 45 times forward. Feels like a pretty fair multiple to me. And the chart is pretty attractive as well. If you look at the kind of again the short-term setup, looking at the chart, this is a company that fell pretty big. RSI got pretty low, maintaining a higher low pattern. It could bounce here. If it does bounce here, I think it's a pretty big bounce coming. So, I do like that setup on ALAB a lot >> 100%. All right, let's round it off with the last uh pigs and shovels play here. Essentially, in the optics sphere, Luminum holdings >> networking, right? You can you kind of tell like I'm big on compute infrastructure. I'm big on on networking. I'm big on custom silicon. I just think networking is in such it it's the next big wave, right? What memory was, I think, in 2026 is what networking becomes in 2027. And Lmentum is the high growth option in networking. If you kind of look at their growth estimates, it's absolutely absurd. 109% revenue growth expected in the summer 2027, 56% in fiscal 28, 42% in fiscal 29, 43% in fiscal 2030. So this is a company that's expected to report 40% plus revenue growth every single year into the summer of 2030 with gross margins going from 52% to 57% and even margins being stable in the mid-40s. This is a massive, massive, massive growth company and it's trading at a pretty attractive valuation of just, let me pull it up. It's one of the most attractively valued stocks in the universe. Uh 23 time forward for what it just enormous growth over 2.8 billion. The pretty much 10 billion over the next few years. And then the chart really attractive. This one's shown a lot of resilience, a lot of relative strength over a medium-term time horizon. recently it got hit pretty hard but it's going to right above the 200 day moving average bouncing right there retaking the 100 day at least trying to 873 right now 874 on that 100 day RSI got pretty low U-turning RSI or MACD got pretty low and recon converging this one looks like it's ready to bounce I like the fact that it's right above the 200 day I think this is bounce time very much like that July 29th bounce off of 600 and then before that I mean the last time it tested the 200 day before that was way back during coming out of the Iran war or the not the Iran liberation day. So, this is a stock that I think is at a pretty unique moment and I think it's it's time to go ahead and chomp and buy that dip and the dip is turning into a rebound. So, those are my five. >> Excellent. >> Yeah. You mentioned the memory analog there. Do do you think some of these optics networking plays have that kind of twerk to hit SanDisk type numbers in >> Well, they already have. >> Right. >> Right. I mean, they already have. So, I I don't >> Yes. I mean Yes. Right. like they already it's light was what it was a $50 stock in April of 25 and now it's a $800 stock. So they there what memory has done networking has done too. I just think that the networking networking seems to have more longevity behind it. Memory is super cyclical. Networking is a little bit less cyclical. So I like the memory setup still. That's why Micron made the list this week. I'm a fan of SanDisk as well. Uh, I think Seagate and Western Digital are also fine, but I like the networking names more. I like Lmentum more. I like AsteraLabs more. I think a name like Max Linear could be pretty interesting, too. So, I think that the networking name just have more longevity. I look at their estimates. There's there's more confidence in outyear growth versus um versus the memory names. And so, that's why I think I like that those trades a little bit better here and now. >> Excellent. All right. So, just closing off the episode here. Uh, one, do you do you have a favorite in this list? And then two, it seems like we aren't going to catch a falling knife if we start to buy back in uh, you know, with cash. Is that safe to say? >> I I think you have to sue uh, you have to sc buying the dip is a process. It's not a moment, right? Like everyone's like this is the time, you know, it's a process. You you buy the dip, you scale in, and then if it continues to fall, you buy more at another major technical support level. If it rebounds, then you buy more at a big technical retake level. Buying the dip is a process. It's an evolution. And so, yes, I think now is a really good time to start that process and start that evolution. I do think we're at some major technical support levels on the major kind of AI stock benchmarks, whether it's AIS or SMH or SOCKS. I think it's a good time to start scaling in. Uh, but I wouldn't be surprised if we do take another leg lower. I also wouldn't be surprised if we rebound here. So, like either way we go, I think this is a good time to start scaling in and still have some dry powder for if we rebound and retake some levels, then put more of it to work. If we fall, wait for the next support levels and put more of it to work. I just think that's that's the the way to play it right now. In terms of a favorite pick, I would have to go Nebius. I just think Nebius is it nine times Ford EVA for 100% compounded uh EVA growth into 2030 is ridiculous. Uh the core weave credit concerns are not warranted at Nebius. Um they're the inference landlord. They own all they own the whole stack. Um the technical setup is really attractive. I think there's nothing not to like about it right here. So if I had to name a favorite, it'd be Nebius. >> Excellent. Love it. Yeah, I like that about the uh dip buying. It's more of a science. It's not you're not buying the lottery. ticket, if you will. >> Well, it's not a binary thing. It's not I'm buying the bottom today and it's if it's not the bottom, then I'm I'm screwed. No, it's like you scale into bottoms. It's like you scale in every position. When you buy a stock, you should never, you know, put 100% on day one. It should be 10% 10. You scale into positions. That's what you unless it's a trade like a shortterm week-long trade or whatever. um for a position that's meant to be held over the course of 12 months or longer, then you should always scale into and scale out of them. You do not buy all at once or sell all at once. You scale in and scale out. That's how you trade. That's it for this episode. We thank you for tuning in. We've certainly enjoyed uh presenting. We hope to see you in the next one. Take care. >> [music]