Month: July 2025

Battle of the Tech Titans

Thank you Perplexity AI for creating this engrossing image.

Amongst the usual Trump horror stories, a news item emerged from the US that grabbed Slack Investor’s eye.

NVIDIA made history by becoming the world’s first publicly traded company to surpass a $4 trillion market capitalization. – USA Today

This made me wonder about the other US Companies that are now really big and worth a lot of money. It is no surprise that the top 5 are all tech companies.

CompanyMarket Cap (USD)
NVIDIA$4.00 trillion
Microsoft$3.75 trillion
Apple$3.20 trillion
Amazon$2.38 trillion
Alphabet$2.18 trillion

NVIDIA has only been around since 1993 and Slack Investor can remember buying their top range Graphic Processing Units (GPU) when he was looking to improve his home PC. The company has really moved on and started its growth spurt when they decided to design chips and software platforms specifically for Artificial Intelligence (AI). NVIDIA chips and networks are used extensively for AI development and training – and the world is crying out for these products to deal with complex AI workloads.

Dangers of current US Market

US Stock market valuation as at July 5, 2025 – The Patient Investor

According to the Shiller PE , Buffet Indicator, and a range of other measures, the US market is overvalued. Slack investor has even considered deploying his US funds elsewhere. But, amongst the vast array of US choice, there are still companies that will do well – whatever the conditions. Slack Investor has almost 14% of his portfolio in Alphabet shares and, this might be a case of too many eggs in the one basket.

Alphabet is a great company and has done well for Slack Investor but recent developments make him think that their dominance may be slipping as it faces new competitors.

Also, there are a few annoying things that are starting to bother Slack Investor about some Alphabet products. This is tricky … as a share owner, I like my companies to make money but, it is a balance – you don’t want to kill the golden goose!

  • Youtube – what a killer application! However, the amount of ads starting to creep into Youtube videos has started to destroy the experience for Slack Investor.
  • Google Search – has long been my go to search engine, but the dominance of sponsored links and cluttered feel has made Slack Investor start to look at other search providers. The recent prominence of the Google search AI summary is a good step to help compete with the alternatives.

Alphabet is a conglomerate of many great businesses and my whinging about a couple of their products is just nit-picking – thank you Spinal Tap! However, Google search and Youtube ads are important to Alphabet and contribute 67% of total revenue (2024) – both of these businesses are under competitive pressure.

Perplexity

Thanks to a suggestion by Trevor, a keen reader of the blog, Slack Investor has been exploring a new AI based search engine – Perplexity. He is liking what he is seeing so far and using it more and more to search the web. It has a refreshingly simple interface and can be used via an app or a web page (https://www.perplexity.ai).

So far, it has been very useful for even complex tasks. Yesterday, I asked Perplexity to find me a ‘package holiday for Australian travellers that includes 3 nights in Bangkok and 4 nights at a beach resort’ – the results were on point! Further, NVIDIA is backing Perplexity and has just launched an AI-powered browser to challenge Google Chrome.

Time to take a look at this NVIDIA company in a Slack way.

NVIDIA (NVDA.NASDAQ) vs Alphabet (GOOGL.NASDAQ)

Both are big growing tech companies in different parts of the industry. It’s too hard for Slack Investor to look at everything so he will just condense it down to numbers that he can understand. The excellent finance resource Market Screener was used to get the statistics. Where PE (2027/8) is the predicted Price Earnings ratio for 2027/8, ROE is the predicted Return on Equity for 2027, EPS Growth (av) is the average of projected earnings annual growth 2025-2027, and the Slack Factor combines all of these metrics into one number – the higher number the better!

NameSymbolPE (2027/8)ROE (2027)EPS GROWTH (AV)SLACK FACTOR
NVIDEA Corp (US)NVDA26.3572962
Alphabet (US)GOOGL15.2261323

Although Alphabet is still projected to be a growing company, it seems that the growth may be slowing. NVIDIA is currently in the spectacular growth stage and Slack Investor wants to be part of it.

It is not cheap (PE 2025 = 53; Forecast PE 2028 = 26 ) … but great companies seldom are. After some compulsory Tour de France viewing, I stayed up late last night to access the US markets to sell some GOOGL and buy NVDA. After the NVDA purchase, respectively, they are now 5% and 9% of my investment portfolio.

Growth Professionals … and June 2025 – End of Month Update

Slack Investor has a healthy regard for those who make a living based upon their performance. It is a general financial wisdom that, if you are following large companies, you will very probably be better off in the long term with passive index funds.

Percentage of active funds that underperform (orange) over a 15-yr period – Spiva

However, some active boutique stock pickers may have an advantage when it comes to smaller international companies. In this category, 33.65% of active funds are able to outperform over a 15-yr period.

Slack Investor is currently backing his own abilities on the stock picking front. But, there will come a time when I lack the ability or inclination to do the (admittedly limited) research work. Also, there are some Slack Investor readers who would like to outsource this task.

Hyperion Global Growth Companies Fund ETF (ASX: HYGG)

I don’t follow individual companies in overseas markets that closely – but there are those that do – and do it very well.

Hyperion are Brisbane-based and started this managed fund back in 2014. They have also offered access as a listed ETF on the ASX since 2021. The ETF would be the way that I would buy it.

HYGG is not a low-cost fund as it has a Management Expense Ratio of 0.70% and an outperformance fee of 20% against benchmarks. The ETF, to date, has not paid a dividend. However, in this case, it seems that the managers are offering good value net of fees.

Growth of the Hyperion Global Growth Companies Fund after fees and costs have been extracted since 2014 – Hyperion

One-year performance (2024 May +47.3%) is impressive. However, Slack Investor is after the real grafters who can produce impressive results over the long-term. Hyperion is establishing a case for consideration.

5 and 10 year Performance of HYGG – net of fees – Hyperion

The advantage of an active fund manager is that they can be nimble and take advantage of any opportunities that the Hyperion analysts discover.

Holdings% Portfolio Weight1-Year ReturnForward P/E
Tesla Inc12.2965.9166.67
ServiceNow Inc9.4234.1660.98
Microsoft Corp7.9510.7333.11
Palantir Technologies Inc Ordinary Shares – Class A7.65498.55263.16
ASML Holding NV ADR7.15-20.8128.74
Spotify Technology SA7.1143.2671.43
Amazon.com Inc712.1433.67
Block Inc Class A5.722.8817.73
Meta Platforms Inc Class A4.6141.928.65

Table of the top holdings of HYGG, their portfolio weight, 1-yr return, and forward PE at May 2025.

When it is time to really ‘get on the couch’, Slack Investor would take a look at these blokes to invest his money. This Hyperion crowd seem to know what they are doing.

June 2025 – End of Month Update

The financial year closes and the Australian, UK and US markets are all in positive territory for the financial year.

Slack Investor remains IN for all followed markets. The ASX 200 (+1.3%) and FTSE 100 (-0.1%) moved modestly. It is a continuation of good times in the US with the S&P 500 rising 5.0%. Are our American friends delusional in an expensive US market? Or, is Slack Investor missing something.

All Index pages and charts have been updated to reflect the monthly changes – (ASX Index, UK Index, US Index). The quarterly updates to the Slack Portfolio have also been completed.