Finance

With roughly 10 weeks to go before 2025 comes to a close, it looks as if it’ll be another banner year on Wall Street — and the evolution of artificial intelligence (AI) is a big reason why.

Empowering software and systems with AI capabilities affords them the opportunity to make split-second decisions and become more efficient at their assigned tasks without human intervention. It’s a game-changing technology that the analysts at PwC believe can add $15.7 trillion to the global economy by the turn of the decade.

Although dozens of public companies have benefited from the AI revolution, none have taken their spot on Wall Street’s mantle quite like Nvidia (NVDA 0.86%), the largest publicly traded company, and Palantir Technologies (PLTR 0.11%). Since 2022 came to a close, Nvidia stock has rocketed higher by more than 1,100% and added over $4 trillion in market value. Meanwhile, Palantir shares are approaching a nearly 2,700% cumulative gain, as of the closing bell on Oct. 16, 2025.

Image source: Getty Images.

While there’s a laundry list of reasons that can justify the breathtaking rallies we’ve witnessed in both companies, this dynamic AI duo has also issued a very clear warning to Wall Street that can’t be swept under the rug.

Nvidia’s and Palantir’s success derives from their sustainable moats

There are few business characteristics investors appreciate more than sustainable moats. Companies that possess superior technology, production methods, or platforms don’t have to worry about competitors siphoning away their customers.

Nvidia is best known for its world-leading graphics processing units (GPUs), which act as the brains of enterprise AI-accelerated data centers. Though estimates vary, Nvidia is believed to control 90% or more of the AI-GPUs currently deployed in corporate data centers.

No external GPU developers have come close to challenging Nvidia’s Hopper (H100), Blackwell, or Blackwell Ultra chips, in terms of compute abilities. With CEO Jensen Huang targeting the release of a new advanced AI chip in the latter half of 2026 and 2027, it seems highly unlikely that Nvidia will cede much of its AI-GPU data center share anytime soon.

To add fuel to the fire, Nvidia’s CUDA software platform has served as an unsung hero. This is the toolkit used by developers to build and train large language models, as well as maximize the compute abilities of their Nvidia hardware. The value of this software is exemplified by Nvidia’s ability to keep its clients within its ecosystem of products and services.

Meanwhile, the beauty of Palantir’s operating model is that no other company exists that can match its two core AI- and machine learning-inspired platforms at scale.

Gotham is Palantir’s true breadwinner. This software-as-a-service platform is used by the U.S. government and its primary allies to plan and oversee military missions, as well as gather and analyze data. The other core platform is Foundry, which is a subscription-based service for businesses looking to make sense of their data and automate some aspects of their operations to improve efficiency.

Palantir’s government contracts have supported a consistent annual sales growth rate of 25% or above, and played a key role in pushing the company to recurring profitability well ahead of Wall Street’s consensus forecast.

Yet in spite of these well-defined competitive edges, this AI-inspired dynamic duo has offered a stark warning to Wall Street and investors.

Image source: Getty Images.

Nvidia’s and Palantir’s insiders are sending a clear message to Wall Street

Though AI has been the hottest thing since sliced bread over the last three years, it’s not without headwinds.

For example, every next-big-thing technology and hyped innovation since (and including) the advent of the internet more than 30 years ago has endured an early innings bubble-bursting event. This is to say that all new technologies have needed time to mature, and evidence of that maturation isn’t wholly evident from the companies investing in AI solutions.

But perhaps the most damning message of all comes from the insiders at Nvidia and Palantir Technologies.

An “insider” refers to a high-ranking employee, member of the board, or beneficial owner holding at least 10% of a company’s outstanding shares. These are folks who may possess non-public information and know their company better than anyone on Wall Street or Main Street.

Insiders of publicly traded companies are required to be transparent with their trading activity. No later than two business days following a transaction — buying or selling shares of their company, or exercising options — insiders are required to file Form 4 with the Securities and Exchange Commission. These filings tell quite the tale with these two high-flying AI stocks.

Over the trailing five-year period, net-selling activity by insiders is as follows:

• Nvidia: $5.342 billion in net selling of shares
• Palantir: $7.178 billion in net selling of shares

In other words, insiders at the two hottest stocks in the AI arena have, collectively, sold $12.5 billion more of their own company’s stock than has been purchased since Oct. 16, 2020.

The stipulation to this publicly reported data is that most executive and board members at public companies receive their compensation in the form of common stock and/or options. To cover the federal and/or state tax liability tied to their compensation, company insiders often sell stock. In short, there are viable reasons for insiders to head for the exit that aren’t necessarily bad news.

What may be even more telling with Nvidia and Palantir Technologies is the complete lack of insider buying we’ve witnessed. The last time an Nvidia executive or board member purchased stock, based on Form 4 filings, was in early December 2020. Meanwhile, there’s been just one purchase by an executive or board member for Palantir since the company went public in late September 2020.

Neither Nvidia nor Palantir Technologies are inexpensive stocks, based on their price-to-sales (P/S) ratios. Over the trailing-12-month period, Nvidia and Palantir are valued at P/S ratios of 27 and 131, respectively. History tells us both figures aren’t sustainable over an extended period.

If no insiders from either company are willing to buy shares of their own stock, why should everyday investors?

With shares up by a jaw-dropping 5,100% over the last 12 months, Rigetti Computing (RGTI -3.01%) exemplifies the life-changing potential of stock investing. If you bought $10,000 worth of shares of this speculative tech company last October, your position would now be worth over half a million dollars.

After a rise of that magnitude, potential new investors must be left wondering if they should jump on Rigetti’s hype train or wait for a dip. Let’s dig into the company’s fundamentals to decide what the near future might bring.

Is quantum computing ready for prime time?

Quantum computing promises to radically expand the reach of digital technology. When it works accurately, it can solve certain types of unusual, but extraordinarily difficult, problems that would take even a classical supercomputer an impossible amount of time. And while the technology has seemed “just around the corner” for decades, some recent breakthroughs have ignited optimism.

For example, one of the chief challenges in developing a useful quantum computer is that they are vastly more prone to errors than classical machines. But late last year, Alphabet subsidiary Google revealed its Willow chip, a state-of-the-art quantum computing chip that does a progressively better job of correcting its own mistakes the more computing power it uses. Perhaps more remarkably, on one of the benchmark computational problems that is used to test the abilities of quantum machines, Willow delivered the answer in about five minutes. For a traditional supercomputer to solve it would have taken 10 septillion years.

If they can be made reliable and cost effective enough to commercialize, such machines could drive revolutionary advances in areas ranging from drug discovery to material science. Quantum computers could also play a role in artificial intelligence by assisting with model training and optimization, which involves finding the most efficient use of resources to achieve a task.

Where does Rigetti fit in?

While Google looks like the leader in quantum computing technology, a rising tide lifts all boats, and investors are pouring capital into the entire industry. Rigetti’s compelling business model has also likely played a role in its explosive rally.

Rigetti takes a comprehensive picks-and-shovels approach to the quantum computing industry. It designs and builds its own chips, called quantum processing units (QPUs), at its California-based foundry. And it created its own programming language called Quil alongside a platform called Quantum Cloud Services (QCS), which is designed to allow clients to access its quantum processing power through the cloud.

The company is in the early stages of commercialization: It recently announced a $5.7 million purchase order for two of its Novera quantum computing systems, which it expects to deliver in 2026. But while these deals are a good sign, investors shouldn’t expect those purchases to necessarily mark the start of mass quantum computing adoption or sustainable growth.

While nonprofit research institutions and early adopters will continue to experiment with quantum computing, analysts at McKinsey and Company believe scalable quantum devices might not be commercially viable before 2040 at the earliest. In the meantime, Rigetti’s financial condition is alarming.

Massive cash burn

Image source: Getty Images.

For better or worse, public companies exist to generate profits for their shareholders. Technological prowess comes second, and arguably doesn’t matter at all if it doesn’t eventually benefit the bottom line. Rigetti’s shareholders may soon have to reckon with this fact.

In the second quarter, its operating losses grew 24% year over year to $19.8 million (compared to revenue of $1.8 million). Meanwhile, the number of shares outstanding jumped by 74% to almost 300 million. Rigetti is still sitting on a mountain of cash from a $350 million stock offering in June. But that money won’t last forever, and investors should expect the company to continue relying on equity financing to fund operations until it can achieve profitability.

With viable quantum computers potentially over a decade away, Rigetti’s management team will likely need to substantially dilute the positions of current shareholders in their efforts to get the company across the finish line. Yet even with this in mind, it’s not too late to buy the stock. If anything, it’s too early. But it may make sense to wait for a correction or another technological breakthrough before you consider opening a position in the stock.

The American dream is something like owning your own home, living comfortably, and seeing your children live happy and productive lives. That dream is even better if you can pass on your wealth to your children, which is basically what’s called generational wealth.

What if you don’t just pass on some money but instead pass on a reliable income stream? That’s what Realty Income (O 1.13%) could let you do. Here’s what you need to know about this unstoppable dividend stock.

The big number is, currently, 30

What does an unstoppable dividend stock look like? That’s pretty easy. It’s a company that manages to increase its dividend every year for decades on end. Real estate investment trust (REIT) Realty Income’s dividend streak is up to 30 years and counting at this point.

Image source: Getty Images.

What’s notable about that streak is that it includes some of the worst economic periods of recent history. And some of the worst bear markets. Realty Income’s dividend grew through the Dot.com crash, the Great Recession (and associated bear market) between 2007 and 2009, and the COVID-19 pandemic. What’s notable is that the Great Recession was particularly difficult for the real estate sector, and the pandemic was devastating to retailers, which make up over 70% of Realty Income’s tenants.

Basically, Realty Income has proven that it has what it takes to survive over the long term while continuing to reward investors with a progressive dividend. But that’s not all. It also happens to have an investment-grade-rated balance sheet, so it is financially strong. And it is geographically diversified, with properties in both the U.S. market and across Europe. While the portfolio is tilted toward retail properties, they tend to be easy to buy, sell, and release if needed. The rest of the portfolio, meanwhile, adds some diversification. All in all, it is a well structured REIT.

Plenty of generational opportunity ahead

The big draw for Realty Income is going to be the dividend yield, which sits at 5.4% or so. That’s well above the 1.2% the S&P 500 index is offering today and the 3.8% or so yield of the average REIT. But, as highlighted above, this isn’t exactly a high-risk investment. Why is the yield so high?

The answer is that Realty Income is a boring, slow-growth business. Over the three decades of dividend growth, the dividend has increased at a compound annual rate of 4.2%. That’s above the historical growth rate of inflation, so the buying power of the dividend has increased over time. But all in all, this is not an exciting stock to own and, frankly, isn’t meant to be. The company trademarked the nickname “The Monthly Dividend Company” for a reason: The REIT’s goal is specifically to be a reliable dividend stock.

There’s no reason to believe it will be anything but reliable in the future. Notably, it is the largest net-lease REIT, giving it an edge on its competitors when it comes to costs and deal making. Management has also been diversifying the business with the goal of increasing the number of levers it has to pull to support its slow and steady growth. None of its efforts involve undue risk, either. Slow and steady is the goal, but so far that’s worked out very well for dividend investors.

A simple and generational proposition

What you are getting when you buy Realty Income is a boring dividend stock that will pay you well to own it. And when the time comes, you can pass that income stream on to the next generation. Building generational wealth is a great thing, but just handing on a pile of money isn’t the only way to do it.

Imagine living a comfortable retirement with the monthly dividends you collect from Realty Income. And while you do that, you can think about how much easier the lives of your children will be when they collect that income instead of you.

Nvidia (NVDA 0.86%) has been one of the most successful stocks in the artificial intelligence (AI) arms race, rising 1,130% since it began at the start of 2023. This has delivered long-term investors phenomenal returns, but there’s a new, exciting investment trend in town that could disrupt how investors view Nvidia’s success.

Quantum computing is one of the most popular industries to invest in, and its stocks have surged over the past few months as investor sentiment surrounding the industry has improved. One of the most popular options is IonQ (IONQ -3.92%), which is no stranger to success. If you’d invested in IonQ instead of Nvidia at the start of 2023, you’d be up 2,150% (at the time of this writing)!

That may have some investors thinking they’ve backed the wrong horse in the computing race. So, is it time to move on from Nvidia and scoop up shares of IonQ? Let’s find out.

Image source: Getty Images.

Nvidia and IonQ are similar businesses

At their core, Nvidia and IonQ are quite close in terms of business pursuit. Nvidia makes graphics processing units (GPUs) alongside other equipment to optimize their performance. GPUs have become the gold standard in high-performance computing applications such as artificial intelligence, drug discovery, engineering simulations, and cryptocurrency mining. Their unique ability to process multiple calculations in parallel makes them a computing powerhouse, and AI hyperscalers have widely deployed them to train and run generative AI models.

IonQ appears to be a much earlier version of Nvidia, focusing on quantum computing rather than traditional computing methods. It’s developing a full-stack solution that provides clients with everything they need to run a quantum computer. Once quantum computing becomes mainstream, many believe it can have widespread use cases in applications like AI training and logistics network improvements. This could lead to a massive market opportunity, similar to what Nvidia experienced at the start of the AI arms race.

However, we’re still a ways away from quantum computing becoming relevant. IonQ and many other quantum computing companies point toward 2030 as the year when quantum computing will become a commercially viable technology. That’s five years out, and there’s still a lot of time for things to go wrong for IonQ (or go right).

IonQ competitor Rigetti Computing estimates that the annual value for quantum computing providers will reach $15 billion to $30 billion between 2030 and 2040. Should IonQ replicate Nvidia’s success by 2030, it could still have room to grow between now and then.

If we assume that the market reaches $15 billion annually in 2030 and IonQ replicates Nvidia’s dominant 90% market share and 50% profit margin, IonQ would be producing profits of $6.75 billion. At a 40 times earnings valuation, that would indicate IonQ could be a $270 billion company, more than a 10x from today’s $23 billion valuation.

But is that enough to warrant selling Nvidia shares to invest in IonQ?

Nvidia has a growth trend of its own

Over the next few years, capital expenditures relating to AI data centers are set to explode. Nvidia estimates that total capital expenditures in 2025 will total $600 billion, but reach $3 trillion to $4 trillion by 2030. If that plays out like Nvidia projects, the total amount of money spent on data center capital expenditures will rise at a compound annual growth rate of 42%. If Nvidia’s growth directly follows that trajectory, that means its stock could rise nearly 6 times in value.

So, which is more likely: Quantum computing becomes viable, IonQ establishes a dominant, Nvidia-like market share and achieves incredibly high margins, or Nvidia’s growth follows widely accepted AI spending trends? I think it’s more likely that the AI arms race continues in its current form, making holding on to Nvidia shares a smart decision. After all of the quantum computing investment hype, I think it’s time for investors to take a break from this sector and focus on some companies that have actual money flowing into them, rather than quantum computing-specific businesses like IonQ.

What happened

According to a filing with the Securities and Exchange Commission dated October 17, 2025, investment management company Capricorn Fund Managers Ltd established a new position in Waystar (WAY 0.46%), acquiring 505,122 shares. The estimated transaction value, based on the average closing price during the third quarter of 2025, was approximately $19.15 million. This addition brings the fund’s total reported positions to 59 at quarter-end.

What else to know

The new position in Waystar accounts for 6.4% of Capricorn Fund Managers’ 13F reportable assets under management. The stock is now the fund’s largest holding by reported market value.

The fund’s top holdings after the filing are:

• WAY: $19.15 million (6.4% of AUM)
• TARS: $14.26 million (4.8% of AUM)
• MSFT: $14.15 million (4.8% of AUM)
• VERA: $13.10 million (4.4% of AUM)
• REAL: $12.64 million (4.2% of AUM)

As of October 16, 2025, shares of Waystar were priced at $36.81, up 34% over the one-year period, outperforming the S&P 500 by 20 percentage points during the same timeframe.

Company overview

Company snapshot

Waystar provides a cloud-based software platform for healthcare payments, including solutions for financial clearance, patient financial care, claims and payment management, denial prevention and recovery, revenue capture, and analytics.

IMAGE SOURCE: GETTY IMAGES.

The company serves healthcare organizations as its primary customers, targeting providers seeking to optimize revenue cycle management and payment processes.

Waystar was founded in 2017 and is headquartered in Lehi, Utah, working in the technology sector with approximately 1,500 employees. The company operates at scale in the healthcare technology industry, focusing on streamlining payment processes for healthcare providers through its cloud-based platform.

Foolish take

Capricorn Fund Managers’ new position in Waystar stock merits attention for a few reasons. The investment management company not only deemed Waystar a valuable addition to its portfolio, but the purchase was so big, the stock catapulted to the top of its holdings.

Investing in Waystar makes sense. The business boasts some compelling qualities. It has grown revenue every quarter for the past two years, and the trend continues in 2025.

In Q2, Waystar’s sales rose 15% year over year to $270.7 million. The company expects to hit $1 billion in revenue this year, up from $944 million in 2024.

Waystar also had a solid balance sheet exiting Q2. Total assets were $4.7 billion compared to total liabilities of $1.5 billion. It does have over $1 billion in debt, but the company is slowly paying this down.

The consistent sales growth Waystar is experiencing, and its forward price-to-earnings ratio of about 25, which is reasonable for a fast-growing tech company, explains Capricorn Fund Managers’ big buy of Waystar stock. These factors make the stock a worthwhile investment for the long haul.

Glossary

13F reportable assets under management: The total value of securities a fund must disclose quarterly to the Securities and Exchange Commission (SEC) on Form 13F.

Stake: The ownership interest or investment a fund or individual holds in a company.

Initiated position: When an investor or fund purchases shares of a company for the first time.

Assets under management (AUM): The total market value of investments managed by a fund or investment firm.

Quarter-end: The last day of a fiscal quarter, used for financial reporting and portfolio snapshots.

Outperforming: Achieving a higher return or growth rate compared to a benchmark or index.

Cloud-based platform: Software and services delivered over the internet rather than installed locally on computers.

Revenue cycle management: The process healthcare providers use to track patient care revenue from appointment to final payment.

Denial prevention and recovery: Strategies to reduce and resolve rejected insurance claims in healthcare billing.

Market value: The current worth of an asset or holding based on the latest market price.

Healthcare payments: Financial transactions related to medical services, including billing, claims, and reimbursements.

TTM: The 12-month period ending with the most recent quarterly report.

Florida-based wealth advisory J. L. Bainbridge disclosed a purchase of Eli Lilly and Company valued at approximately $45.6 million for the quarter ended September 30, according to an SEC filing released on Friday.

What Happened

J. L. Bainbridge & Co. Inc. significantly increased its stake in Eli Lilly and Company (LLY -1.94%), acquiring 61,258 additional shares during the quarter. The estimated value of the purchase was $45.6 million based on the average closing price for the quarter. The position was reported in the firm’s quarterly Form 13-F filing with the Securities and Exchange Commission on Friday.

What Else to Know

This buy brings the position to 3.9% of J. L. Bainbridge & Co. Inc.’s 13F reportable assets.

Top holdings after the filing:

• NASDAQ:MSFT: $164.85 million (13.9% of AUM)
• NASDAQ:AAPL: $122.68 million (10.4% of AUM)
• NASDAQ:GOOGL: $116.65 million (9.9% of AUM)
• NYSE:GS: $71.43 million (6% of AUM)
• NYSE:ETN: $59.86 million (5.1% of AUM)

As of Friday’s market close, shares of Eli Lilly and Company were priced at $802.83, down 11% over the past year and far underperforming the S&P 500’s nearly 14% gain over the same period.

Company Overview

Company Snapshot

• Eli Lilly offers a broad portfolio of pharmaceuticals for diabetes, oncology, immunology, neuroscience, and other therapeutic areas, with leading products including Humalog, Trulicity, Jardiance, Verzenio, and Taltz.
• The company generates revenue primarily through the discovery, development, manufacturing, and global sale of branded prescription drugs, leveraging both proprietary research and strategic collaborations.
• It provides pharmaceuticals for chronic and complex diseases worldwide.

Eli Lilly and Company is a global pharmaceutical leader that maintains a diversified portfolio of innovative therapies for high-burden diseases. Its scale, established brands, and strategic partnerships provide competitive advantages in the rapidly evolving healthcare sector.

Foolish Take

Florida-based J.L. Bainbridge & Co. boosted its exposure to Eli Lilly last quarter, purchasing roughly $45.6 million worth of shares even as the stock has endured a difficult stretch. Shares are down 11% over the past year, pressured by valuation concerns and, most recently, political commentary on potential weight-loss drug price cuts. The decline followed remarks by President Donald Trump, who suggested GLP-1 treatments like Lilly’s Mounjaro and Zepbound could face price reductions—a move that briefly sent shares tumbling more than 4% on Friday.

Despite near-term volatility, Bainbridge’s purchase reflects long-term conviction in Lilly’s fundamentals. The pharmaceutical giant remains a dominant player in metabolic and diabetes care, with GLP-1 demand still far outpacing supply. Analysts at BMO Capital Markets called the recent selloff “overdone,” noting that most insured Americans already pay modest out-of-pocket costs for these drugs.

For Bainbridge, whose portfolio is anchored by Microsoft, Apple, and Alphabet, the addition of Lilly underscores a strategy centered on durable growth and innovation-led healthcare exposure. Long-term investors may see current weakness as a potential entry point into one of the most profitable franchises in global pharmaceuticals.

Glossary

Form 13-F: A quarterly SEC filing by institutional investment managers disclosing their equity holdings.
AUM (Assets Under Management): The total market value of investments managed on behalf of clients by a fund or firm.
Reportable AUM: Portion of a fund’s assets that must be disclosed in regulatory filings, such as the Form 13-F.
Top holdings: The largest investments in a fund, ranked by their value as a percentage of total assets.
Trailing twelve months (TTM): The 12-month period ending with the most recent quarterly report.
Stake: The ownership interest or position an investor holds in a company, usually measured in shares or percentage.
Strategic collaborations: Partnerships between companies to jointly develop, market, or distribute products or services.
Pharmaceutical portfolio: The collection of drugs and therapies a company develops, manufactures, and sells.
Underperforming: Delivering a lower return or performance compared to a benchmark or peer group.

Florida-based wealth advisory J. L. Bainbridge & Co. sold 119,376 shares of Biogen (BIIB 0.58%) during the third quarter for an estimated $16.1 million.

What Happened

In a quarterly disclosure filed with the Securities and Exchange Commission on Friday, J. L. Bainbridge & Co. Inc. reported selling 119,376 shares of Biogen (BIIB 0.58%) during the third quarter. The estimated value of the shares sold was $16.1 million, based on the average closing price for the period. The fund now holds just 2,969 shares of Biogen valued at $415,898 as of September 30.

What Else to Know

The sale reduced Biogen to 0.03% of reported U.S. equity assets under management as of September 30.

Top holdings after the filing:

• NASDAQ:MSFT: $164.85 million (13.9% of AUM)
• NASDAQ:AAPL: $122.68 million (10.4% of AUM)
• NASDAQ:GOOGL: $116.65 million (9.9% of AUM)
• NYSE:GS: $71.43 million (6% of AUM)
• NYSE:ETN: $59.86 million (5.1% of AUM)

As of Friday’s market close, shares of Biogen were priced at $143, down 23% over the past year.

Company Overview

Company Snapshot

• Biogen’s portfolio includes therapies for neurological and neurodegenerative diseases, such as multiple sclerosis, spinal muscular atrophy, Alzheimer’s disease, and biosimilars targeting autoimmune disorders.
• The company generates revenue through the discovery, development, manufacturing, and commercialization of branded pharmaceuticals and biosimilars, with a focus on specialty and rare disease markets.
• Biogen serves a global customer base, including healthcare providers, hospitals, and specialty pharmacies treating patients with neurological and rare diseases.

Biogen specializes in therapies for complex neurological and neurodegenerative conditions. With a diversified product suite and a robust pipeline, Biogen leverages scientific innovation and strategic collaborations to maintain its position in high-need therapeutic areas.

Foolish Take

Florida-based J.L. Bainbridge & Co. dramatically scaled back its Biogen holdings last quarter, selling nearly its entire position for roughly $16 million. The firm, known for its long-term focus and balanced growth strategy, now holds only about $416,000 worth of Biogen stock—just 0.03% of its reportable U.S. equity assets.

The timing aligns with Biogen’s mixed performance over the past year. Shares are down 23%, despite a strong second-quarter report showing 7% year-over-year revenue growth to $2.6 billion and raised full-year guidance. The company highlighted sequential growth in Alzheimer’s therapy LEQEMBI, rare-disease drug SKYCLARYS, and postpartum-depression treatment ZURZUVAE, with CEO Christopher Viehbacher calling it “another quarter of strong execution” as Biogen reshapes its portfolio for sustainable growth. Still, the stock has struggled amid investor skepticism fueled by declining sales.

Bainbridge’s near-exit follows other portfolio adjustments—such as trims to Delta Air Lines—as the firm concentrates its holdings in proven large-cap growth names like Microsoft, Apple, and Alphabet. For long-term investors, Biogen’s upcoming October 30 earnings will be a key moment to gauge whether its new drug launches can meaningfully offset the erosion of its older franchises.

Glossary

AUM (Assets Under Management): The total market value of assets a fund or investment manager oversees on behalf of clients.
Quarterly disclosure: A report filed every three months detailing a fund’s holdings, transactions, and other relevant financial information.
Post-trade stake: The number of shares or percentage of ownership remaining after a buy or sell transaction.
Top holdings: The largest investments in a fund’s portfolio, usually ranked by market value or portfolio percentage.
Biosimilars: Biologic medical products highly similar to already approved reference drugs, used to treat various diseases.
Specialty and rare disease markets: Healthcare sectors focused on developing treatments for uncommon or complex medical conditions.
Pipeline: The portfolio of drugs or products a company is developing, from early research to late-stage clinical trials.
Strategic collaborations: Partnerships between companies to jointly develop, market, or distribute products or technologies.
TTM: The 12-month period ending with the most recent quarterly report.

It has been an up and down year for Warren Buffett’s portfolio. Many of his biggest positions have been trimmed aggressively. But according to recent filings, his holding company, Berkshire Hathaway, is loading up on one of Buffett’s favorite stocks. Last quarter, it boosted its position by more than $500 million.

On paper, this stock has it all. It’s priced at a discount to the market, offers a compelling dividend yield, and could generate impressive growth over the next few years.

This has been one of Warren Buffett’s favorite stocks since 2020

Berkshire Hathaway first took a position in Chevron (CVX 0.94%) back in 2020, not long after the nadir of the COVID-19 flash crash. Buffett’s estimated purchase price was around $80. But over the years, he has managed the position aggressively. In early 2021, for instance, just one year after his initial purchase, Buffett slashed his Chevron stake by more than 50%. Towards the end of 2021, however, he began rebuilding his position. Several more purchases and sales occurred in 2022, including the massive acquisition of 121 million shares in the first quarter.

Notably, Berkshire has been a net seller in recent quarters. In six of the past seven quarters, for example, Berkshire has sold more Chevron stock than it purchased. But that all changed this quarter when Buffett purchased nearly 3.5 million shares worth roughly $520 million. It was one of the biggest stock purchases of the quarter for Buffett, giving Berkshire a 7% stake in the entire business.

Why did Buffett load up on this giant oil stock that he knows so well? The numbers below paint a compelling picture.

Chevron stock looks very attractive for certain investors

After several consecutive winning years, the stock market as a whole isn’t obviously a value right now. The S&P 500, for example, trades at 31 times earnings — well above its long-term average. Chevron stock, meanwhile, trades at just 19 times earnings. Revenue growth is stagnant right now, but free cash flow remains high, helping to support a 4.5% dividend yield.

Part of the challenge with Chevron stock right now isn’t under its direct control. Oil prices slid heavily this year, falling under $60 per barrel. Oil inventories continue to rise, with meaningful surpluses expected in 2026 due to rising production globally. In total, it’s a tough place to be for businesses that sell oil.

As an integrated producer, with interests in refining, chemical production, and even energy generation for artificial intelligence applications, Chevron has long been able to manage industry cyclicality with ease. Chevron’s CEO focuses on cost controls and capital efficiency to ensure profits remain stabilized even with low oil prices. But unless those oil prices move higher, expect so-so results from Chevron — a big reason why shares have traded sideways since 2022.

Here’s the thing: Chevron stock is still a very compelling purchase for certain investors. If you’re finding it difficult to find market values, are worried about a potential bear market, or believe geopolitical tensions are about to rise, allowing oil prices to recover quickly, Chevron shares could be a fit. While shares aren’t a steal, they are arguably fairly valued at 19 times earnings. The dividend yield and free cash flow consistency, meanwhile, can help offset losses during a market downturn. And given ongoing geopolitical disputes, it’s not unreasonable to expect sudden shifts in oil demand and supply.

All in all, this looks like a classic move for Buffett in this market environment. He understands Chevron’s business model well, and with a rising cash hoard, it’s clear that he’s finding it difficult to spot market bargains. Chevron is as close to a value stock in today’s environment as it gets.

On October 17, 2025, Sapient Capital LLC disclosed a purchase of 259,392 Eli Lilly and Company (LLY -1.94%) shares, for a total transaction value of $193,028,908.

What Happened

Sapient Capital LLC increased its stake in Eli Lilly and Company by 259,392 shares during Q3 2025, according to a U.S. Securities and Exchange Commission (SEC) filing dated October 17, 2025 (SEC filing). The estimated transaction value was $193.03 million, based on the average closing price for Q3 2025. The fund now holds 1,477,879 shares worth $1.07 billion in Q3 2025.

What Else to Know

Buy activity increased the position to 16.53% of Sapient Capital’s 13F AUM in Q3 2025

Top holdings after the filing:

• LLY: $1.07 billion (16.5% of AUM) as of September 30, 2025
• APP: $906.45 million (14.0% of AUM) as of September 30, 2025
• AAPL: $346.81 million (5.3% of AUM) as of September 30, 2025
• MSFT: $313.49 million (4.8% of AUM) as of September 30, 2025
• GOOGL: $238.99 million (3.7% of AUM) as of September 30, 2025

As of October 17, 2025, shares were priced at $802.83, down 12.46% over the past year; shares have underperformed the S&P 500 by 25.79 percentage points

Company Overview

Company Snapshot

Eli Lilly and Company is a global pharmaceutical leader with a market capitalization of $722.03 billion as of October 17, 2025 and a diversified portfolio of innovative therapies. The company’s strategy centers on advancing high-impact medicines and expanding its reach through scientific innovation and partnerships. Its scale and established presence in key therapeutic areas provide advantages in the healthcare sector.

The company offers a broad portfolio of pharmaceuticals for diabetes, oncology, immunology, neuroscience, and other therapeutic areas, with leading products such as Trulicity, Humalog, Jardiance, and Taltz. It generates revenue primarily through the discovery, development, and global commercialization of branded prescription medicines, leveraging internal R&D and strategic collaborations. It treats patients with chronic and complex health conditions.

Foolish Take

This recent transaction by Sapient Capital, a private wealth advisor, is a notable institutional purchase. Here’s why.

First off, Sapient acquired over 259,000 shares of Eli Lilly, worth around $193 million. That is, of course, a great deal of money. But beyond that, the transaction makes the stock Sapient’s largest overall holding, with about $1.07 billion worth of Eli Lilly stock. In other words, Sapient is significantly increasing its already enormous stake Eli Lilly stock. That demonstrates the fund managers have a great deal of conviction that Eli Lilly stock should perform well.

Average investors may want to take note of this, particularly given Eli Lilly’s recent underperformance against major market indexes like the S&P 500. For example, Eli Lilly stock has lagged the S&P 500 year-to-date. Indeed, it has generated a total return of around 5% in 2025, while the benchmark index has generated a total return of 14%.

One potential headwind for Eli Lilly may be political pressure from Washington. President Donald Trump recently said that his administration will work to cut the cost of brand-name GLP-1s, like Eli Lilly’s Zepbound, to $150 per month — a significant decrease from the rate Eli Lilly currently offers on their direct-to-consumer site. That could cut into the company’s profits which have skyrocketed from $5 billion to nearly $14 billion thanks in part to the introduction of Zepbound in 2023.

In summary, investment advisor Sapient has made a huge bet on Eli Lilly stock, boosting its stake by ~25% and making the stock its top holding. The company’s shares have underperformed this year, and pressure from Washington is increasing for the company to lower the price of its star drug, Zepbound, which could stifle its overall profitability. All in all, it’s a mixed picture for Eli Lilly with significant uncertainty surrounding at least one of its key products.

Glossary

13F assets under management (AUM): The value of securities a fund manager reports to the SEC on Form 13F, typically U.S.-listed equities.
Position: The amount of a particular security or asset held by an investor or fund.
Trailing twelve months (TTM): The 12-month period ending with the most recent quarterly report.
Dividend yield: Annual dividends per share divided by the share price, shown as a percentage.
Forward price-to-earnings ratio: A valuation metric comparing a company’s current share price to its expected future earnings per share.
Enterprise value to EBITDA: A valuation ratio comparing a company’s total value (enterprise value) to its earnings before interest, taxes, depreciation, and amortization.
Stake: The ownership interest or share held by an investor in a company.
Holding: A security or asset owned by an investor or fund.
Buy activity: The act of purchasing additional shares or assets, increasing an investor’s or fund’s position.
Therapeutic areas: Specific categories of diseases or medical conditions targeted by pharmaceutical products.
Strategic collaborations: Partnerships between companies to achieve shared business or research goals.

Nvidia has been the dominant force in the global semiconductor industry thanks to its graphics processing units (GPUs), which have played a critical role in enabling the proliferation of artificial intelligence (AI) applications. The demand for Nvidia’s GPUs has been so solid in the past three years that Nvidia has now become the world’s largest company.

Nvidia continues to rule the AI data center GPU market, facing very little threat from its peers so far. Analysts are expecting its top line to jump by an impressive 58% in the current fiscal year to more than $206 billion. That’s quite impressive for a company of Nvidia’s size. The stock registered respectable gains of 34% on the market this year based on the healthy growth that the company continues to deliver.

However, Nvidia’s stock market performance has been overshadowed by Broadcom (AVGO -1.24%). Broadcom has appreciated 48% this year and looks set to end 2025 on a high note following recent developments. In fact, it won’t be surprising to see Broadcom stock outperforming Nvidia next year as well. Let’s see why that may be the case.

Image source: Nvidia.

Custom AI chips are expected to witness stronger demand in 2026

So far, the majority of AI model training and inference has been carried out by Nvidia’s GPUs. GPUs are general-purpose computing chips with massive parallel computing power, making them ideal for quickly training AI models and moving them into production. OpenAI chose Nvidia’s A100 data center GPUs to train its popular chatbot ChatGPT three years ago.

Nvidia built upon its first-mover advantage and controlled an estimated 92% of the AI data center GPU market at the end of last year. However, the latest deal struck between OpenAI and Broadcom indicates that Nvidia’s influence over the AI chip market could wane. OpenAI will buy custom AI accelerators worth a whopping 10 gigawatts (GW) from Broadcom starting in the second half of 2026.

The deployment is expected to be completed by the end of 2029. This is a massive deal for Broadcom considering that it reportedly costs around $10 billion to build a 1 GW data center. Around 60% of the investment that goes into building a data center is allocated toward chips and other computing hardware, which would put Broadcom’s potential addressable market from each gigawatt of OpenAI’s deployment at $6 billion.

So, Broadcom could be sitting on a potential revenue opportunity worth $60 billion from this deal over the next three years. Broadcom’s custom AI processors have already been in terrific demand as hyperscalers and AI giants such as OpenAI are gravitating toward these chips because of the advantages they enjoy over GPUs.

Custom AI processors are designed for performing targeted tasks, such as AI inference. As a result, they are not only more power-efficient at running those workloads but also enjoy a performance advantage since they don’t need to perform any other tasks. Hence, deploying custom AI processors can help save costs for hyperscalers.

Shipments of application-specific integrated circuits (ASICs) meant for deployment in AI data centers are expected to increase by 45% in 2026, compared to the expected growth of 16% in GPUs. Broadcom is in the best position to make the most of this growth opportunity as it leads the ASIC market with an estimated share of 70%.

Moreover, the new deal with OpenAI along with another $10 billion contract with an unnamed customer that the company announced last month should ensure outstanding growth in Broadcom’s AI revenue next year.

Broadcom’s AI revenue could now increase at a faster pace

Broadcom is on track to end the current fiscal year with almost $20 billion in AI revenue, an increase of 64% from the previous year. The company reported a record revenue backlog of $110 billion at the end of the fiscal third quarter (which ended on Aug. 3). That backlog is likely to have moved higher following the recent deals struck by the company.

Don’t be surprised to see Broadcom’s revenue jumping at a faster pace than the 33% growth that Wall Street is expecting next fiscal year, which would be a nice improvement over the 23% growth it is expected to deliver in the current one. There is a good chance that its revenue growth in the long run could be better than expectations as well.

AVGO Revenue Estimates for Current Fiscal Year data by YCharts

Broadcom was already anticipating a serviceable addressable market worth $60 billion to $90 billion based on the three AI customers it was serving until earlier this year. That addressable market is now much bigger following the OpenAI contract, which opens up the possibility of stronger growth and more upside for Broadcom investors.

In most years, Social Security retirees receive a cost-of-living adjustment (COLA), and that’s likely to happen in 2026. COLAs are critical because without them, benefits would remain unchanged while the price of goods and services increase over time. Retirees would be left with far less buying power, and many would struggle to make ends meet since Social Security is an important income source for seniors.

COLAs aren’t the same from one year to the next, though. While the 2026 COLA hasn’t been announced, there are good estimates of what it’s going to be. Based on the existing data, it looks like the amount of the benefits increase is going to be different from the raise retirees got in 2025.

Here’s what next year’s COLA is likely to be, compared with the benefits bump you got in 2025.

Image source: The Motley Fool.

How will next year’s Social Security COLA compare?

The 2026 COLA will officially be announced on Friday, Oct. 24, 2025. The Senior Citizens League estimates the cost-of-living adjustment will result in a 2.7% benefits increase.

A 2.7% increase would be a bit larger than the raise retirees got in 2025, when benefits rose 2.5%. However, it will be smaller than COLAs from recent memory, including the 3.2% benefit increase in 2024, the 8.7% raise in 2023, and the 5.9% COLA in 2022.

Unfortunately, while the COLA is on track to be larger in 2026 than in 2025, retirees may not see the full 2.7% increase in their payment because Medicare premiums are going to be rising as well — and by much more than they did in 2025.

In 2025, the standard premium for Medicare Part B rose $10.30, jumping from $174.70 in 2024 to $185.00 in 2025. In 2026, projections from the Medicare Board of Trustees suggest that Part B premiums will go up $21.50, from the current $185.00 all the way up to $206.50. This is one of the biggest year-over-year increases in the history of the program.

Unfortunately, since most people have Medicare premiums taken directly out of their Social Security checks, a good portion of the extra money that seniors get from the COLA will disappear.

For example, if someone had a $2,000 monthly benefit in 2024, this year’s 2.5% COLA would have given them around a $50 monthly raise, and they’d have lost $10.30 of it. Their check would have gone up by around $39.70.

Someone with a $2,000 check in 2025, on the other hand, could see their payments rise by 2.7% in 2026, or $54 per month. A $21.50 Medicare premium increase would leave them with only $32.50 extra each month.

This means the “bigger” benefits bump this year may be nothing but a mirage, and retirees could find themselves struggling to maintain buying power based on current levels of inflation.

Is a larger COLA good news or bad news?

The reality is, even aside from the Medicare issue, it isn’t good news that Social Security retirees are on track for a bigger COLA. That’s because cost-of-living adjustments are directly tied to a formula that measures how much the cost of goods and services is going up. A bigger raise means there are higher levels of inflation, and inflation generally isn’t good for older people on fixed incomes.

Many seniors also have money saved in retirement plans, and since people tend to be conservative with their investments during retirement, their returns may not outpace inflation by much when inflation is high. 

For now, seniors will need to simply wait and see what the official COLA announcement brings on Oct. 24. The news will offer insight into what their finances will look like in the coming year, but retirees should prepare for potential disappointment, even if the COLA amount looks good on paper.

Quantum computing stocks have been on an absolute tear recently as their companies announced major contract wins. But that was all topped off by JPMorgan Chase‘s announcement this week that it’s investing $10 billion into strategic tech companies. That includes quantum computing businesses. But for quantum computing stocks to rise around 20% (some more, some less) following that news is troublesome.

No specific investment was announced in any of these companies, and other massive industries were listed in the release — such as supply chain and advanced manufacturing, defense and aerospace, energy technology, and frontier and strategic technologies (where quantum computing was lumped in). This raises concerns about the short-term nature of the quantum computing market. The combined rise of all quantum computing stocks was more than the overall $10 billion investment announced by JPMorgan Chase, so there’s clearly not enough to go around.

Observers have begun to speculate that there may be a quantum computing bubble forming. So is now the time to sell? I think Warren Buffett has some great advice for investors on what they should do.

Image source: Getty Images.

Warren Buffett has seen a bubble or two in his career

Warren Buffett is the legendary CEO of Berkshire Hathaway, a position he has held since he took control of the company in 1965. Over the years, Buffett has given investors several great pieces of wisdom, and I think one quote is applicable right now. He wrote that his goal was to “attempt to be fearful when others are greedy and to be greedy only when others are fearful.”

There are clearly many signs of greed in the quantum computing market. As mentioned above, many of the quantum computing stocks rose by a massive amount in response to a nonspecific announcement that JPMorgan Chase would invest in emerging technologies.

Furthermore, we’re still years away from quantum computing viability. Most competitors point toward 2030 as the likely turning point in quantum computing’s commercial relevance, and that’s still five years away. Five years ago, we were in the beginning stages of the COVID-19 pandemic, and nobody (outside of a handful of companies) had ever heard the term generative AI. It’s impossible to know what will happen in the field over the next five years, or which companies will be the winners.

Most of the investment dollars flowing into the quantum computing space have centered around the pure plays. Still, there are also legacy tech players, like Alphabet, Microsoft, and IBM, which have nearly unlimited resources compared to pure plays like IonQ (IONQ -3.92%) or Rigetti Computing (RGTI -3.01%). It’s still an uphill battle for IonQ and Rigetti, and just because the big tech players aren’t saying anything doesn’t mean they aren’t experiencing success.

Companies like IonQ and Rigetti Computing are still years away from profits, and have to rely on government contracts and stock issuance to continue to fund their operations. As a result, they must issue a news release on any piece of positive news they can to let investors know about their successes. The big tech companies like Alphabet, IBM, and Microsoft can afford to stay silent about any breakthroughs, as they’re internally funding their research.

The big tech players may be far more advanced than the pure plays, even if nobody outside of those companies knows it yet. I think this could be setting up some of the pure-play stocks for failure, and their shareholders should take action.

Taking some profits in an increasingly frothy industry is a smart move

Another Warren Buffett quote is applicable in this situation, too: “The first rule in investment is ‘Don’t lose.’ And the second rule in investment is ‘Don’t forget the first rule.'” Investors have already made a significant amount of money on the quantum computing trade, and while it’s possible these stocks could continue rising, a crash may be around the corner.

If you’ve invested in these stocks at any time this year, it may be time to at least trim some of them, as it’s unlikely that they’ll continue rising forever. By taking some profits now, you can be well positioned to deploy them back into the industry if it returns to earth.

Nobody ever lost money by selling a stock at a profit, although they have lost out on even larger returns. Still, I think the risk is greater than the reward, and it may be a wise time to take some profits off the table.

Just across Long Island Sound from Long Island itself sits Purchase, NY, home of consumer-packaged goods giant PepsiCo (PEP 0.80%). The business began with a single beverage — Pepsi-Cola — in the small coastal town of New Bern, NC. But a bankruptcy saw the brand change hands, ultimately landing it with a business in New York, the state it’s still headquartered in today.

Since relocating to its current headquarters in Purchase, NY in 1970, PepsiCo has undergone a radical transformation. It’s an international powerhouse in the consumer-packaged goods space with dozens of beverage brands as well as food brands. And recent financial results underscore why this is still a solid stock to buy for the long term.

Image source: PepsiCo.

Pepsi’s rock-solid business

Pepsi stock is down about 23% from the all-time high it reached two years ago. Investors have soured on this stock because sales volume is under pressure. Investors consequently speculate that perhaps consumers are trading down to cheaper brands, that consumers are choosing healthier options, or that weight-loss drugs are suppressing appetites.

However, Pepsi is more resilient than investors give it credit for. On Oct. 9, the company reported financial results for its fiscal third quarter of 2025. Sales volume did decline by 1% for both beverages and convenient foods. And the decline was even more pronounced in North America. But the headline numbers didn’t tell the whole story.

Pepsi is actively reshaping its portfolio of beverage brands. One example is selling Rockstar Energy to Celsius. But another example is transitioning its case pack water business to a third-party partner. Changes such as these impact quarterly sales volume.

By simply adjusting results for the change to the water business, Pepsi’s beverage volumes in North America grew in Q3 — that’s a big deal. It suggest that the company is getting some positive traction in a core market with core products.

Sales in North America have been challenged for a while now. But Pepsi’s business was never in dire straights. This is because sales volume for food and beverages has continued rising in both Latin America and Asia.

This is the benefit of being a large, diversified business. Even if one part of Pepsi’s business is facing headwinds, chances are that other parts of the business are able to pick up the slack.

Is Pepsi stock a good long-term buy?

I believe that Pepsi stock is a good long-term buy, but I should clarify what I mean by that. I don’t believe that this will be among the top-10 stocks over the next decade or anywhere close to that. Those stocks will probably be up-and-coming businesses experiencing a lot of growth. And with over $90 billion in trailing-12-month revenue, it’s unrealistic to expect Pepsi’s business to be high growth.

But I believe Pepsi stock will make investors money over the long term with relatively little risk. Even if consumer tastes and preferences are shifting, the company operates a portfolio that it can adjust. As one example, Pepsi acquired prebiotic soda brand Poppi for nearly $2 billion, and it can use this new business to build more products that are aligned with trending preferences.

Moreover, Pepsi is a Dividend King, having paid and increased its dividend for 53 consecutive years now. This is a streak that it’s not going to give up on easily. And thanks to the pullback in the stock price, dividend investors can lock in at nearly an all-time high dividend yield, boosting returns from here.

PEP Dividend Yield data by YCharts.

Yes, Pepsi may be headquartered in New York. But this company is much more than the Pepsi brand, and it’s much bigger than the Empire State. It’s a profitable global business with a diversified portfolio that can adapt to changes in the consumer landscape.

Therefore, Pepsi stock is a solid long-term buy in my view and a good addition to a diversified portfolio of stocks.

Digital bank Nu Holdings (NU 2.00%) has a market capitalization of $72 billion — and that makes it a sizable business. However, many American investors might not know that much about the company because it operates in Latin America and has no U.S. presence.

Here’s a perfect example of why it’s important to understand that there are investment opportunities in international markets. This fintech stock might prove that point. Should you buy Nu Holdings while it’s trading below $16? Here’s why that might be a smart decision.

Image source: Getty Images.

Customer additions and revenue growth are through the roof

The market loves a good growth story — and Nu Holdings is exactly that. The company’s customer base went from 65 million at the end of Q2 2022 to 123 million as of June 30. In Nu’s home country of Brazil, the business counts 60% of the adult population as its customers. Newer markets of Mexico and Colombia are registering remarkable success, even though Nu’s penetration is still in the early stages in these countries.

Nu is benefiting from some notable tailwinds. It helps that internet and smartphone penetration in Latin America continue to grow. This provides a favorable backdrop for a digital-only bank like Nu to find broader adoption.

Essentially, Nu is riding the wave of the Latin American economy’s development. Given that a large portion of the population here is still unbanked or underbanked, Nu still has lots of potential for growth.

The company’s revenue increased 29% year over year in Q2. Wall Street consensus sell-side analyst estimates believe the top line will rise by 67% between 2025 and 2027. That outlook should make shareholders excited.

Nu’s focus on product innovation should help it reach more customers. Management has also hinted at entering new countries in the future, basically replicating strategies that have worked so well in its existing markets.

This is an extremely profitable enterprise

Companies that have access to cheap capital usually care about growth more than anything else when it comes to strategic priorities. That’s why over the past decade or so, some businesses have put up huge gains, adding customers and increasing sales rapidly. The issue, however, is that these companies don’t care about profits.

Nu bucks this trend and stands out. It’s an extremely profitable enterprise, which might be a surprise to many. Nu registered $1.2 billion in net income through the first six months of 2025. That translated to a phenomenal net profit margin of 17.4%. The margin has generally increased in recent years, which underscores the company’s ability to scale up in a lucrative manner.

Investors should pay attention to the unit economics. It cost the company $0.80 per month in Q2 to serve the average customer. But on the flip side, the average revenue per active customer came in at $12.20. After viewing these two figures, it makes sense why the leadership team is trying to grow so quickly.

Nu also has the advantage of not running any physical bank branches. A brick-and-mortar retail strategy like this would entail sizable operating expenses. Nu avoids this, which can help drive higher margins over time.

This fintech stock trades at a reasonable valuation

In the past three years, Nu’s shares have skyrocketed 262% (as of Oct. 16), thanks to incredible fundamental performs that has caught the market’s attention. After such a phenomenal gain, investors might be questioning the stock’s appeal. The last thing you’d want to do is overpay.

That’s certainly not the case here. The valuation still looks very compelling. Investors can buy the stock at a forward price-to-earnings ratio of 18.7. At under $16 per share, there is sizable upside over the next five years from the possibility of both higher earnings and valuation expansion.

Trade tariffs are mixing up the global economy in 2025. The Trump administration has issued double-digit import fees on goods from most countries, with even higher rates in markets like China and India. Some of these tariffs are currently in effect, while others are pending, with a patchwork of countermeasures issued by the targeted countries. To keep an eye on this messy situation, check out The Motley Fool’s tariff and trade investigation tracker — a living document that does all the hard data-tracking work for you.

Few companies are more international than IBM (IBM 1.82%) — Big Blue even has “international” in its name. It runs research labs on six continents, has more employees in India than the United States, and runs business offices in more than 170 countries. Almost exactly half of IBM’s revenues were collected in the Americas in 2024, which also includes Canada and Latin America.

Surely this global giant must feel the pinch from criss-crossing tariff policies, right? As it turns out, IBM isn’t too concerned with the ongoing trade tensions.

Image source: Getty Images.

How exposed is IBM to the tariff tango?

There are different ways to figure out IBM’s tariff exposure. I could take the complicated web of current and future tariff rates, apply them to each of IBM’s products and services in various countries, and create an intimidating spreadsheet. Or I could look for management’s statements about the tariff challenge.

The company helped me out by addressing the unpredictable tariff policies in the first-quarter earnings call. This call took place on April 23, three weeks after Trump’s “Liberation Day” tariff announcement.

“Over the last several years, we have strategically diversified and streamlined our supply chain,” said CFO Jim Kavanaugh. “Goods imported to the U.S. represent less than 5% of our overall spend and under current U.S. tariff policy, the impact to IBM is minimal.”

Why IBM shrugs at tariff headlines

That brief statement means a couple of things to me:

• It’s IBM’s only official discussion of tariffs in 2025, even though the trade expenses have shifted significantly since April. In other words, the tariff issue is hardly worth mentioning.
• Applying tariff rates to “less than 5%” of IBM’s global spending is not exactly nothing, of course. I’d hate to cover that multimillion-dollar bill from my personal accounts. IBM still builds mainframe computers, requiring parts from tariff-laden countries like China or the European Union. But the cost of products and services stopped at 16.3% of total revenues last year, and 5% of that gross expense ratio is less than 1% of IBM’s incoming revenues. Even if every tariff were a beefy 100% surcharge, that’s a pretty manageable extra cost — and most of the international trade fees are far smaller.

IBM plays it safe anyway

I’m still waiting for IBM to issue further updates about the tariff situation, but I’m not holding my breath in anticipation. Yes, the company is tremendously global, but it can still operate comfortably without running into game-changing tariff expenses.

At the same time, IBM is taking action to minimize even this modest financial impact. Kavanaugh also noted that IBM is looking into alternative sources for tariff-laden components. Every dollar counts, you know.

Furthermore, Big Blue announced a $150 billion American investment plan at the end of April. The company will move significant manufacturing and research assets to domestic soil over the next five years, starting with $30 billion of mainframe development and quantum computing research operations. Again, the tariffs don’t really hurt, but it can’t be a bad idea to minimize the financial sting anyway. Plus, this homebound manufacturing move might unlock unrelated favors from the Trump team.

So, it makes sense to take some tariff-dodging action, but IBM would barely notice the extra costs anyhow. I don’t expect Big Blue to suffer a tariff-related downturn any time soon.

Range Financial Group LLC fully exited its position in Fortinet (FTNT 0.45%), selling 29,944 shares for an estimated $3.2 million, according to an SEC filing dated Oct. 17.

The fund sold its entire position in Fortinet.

The position previously accounted for 1.2% of the fund’s AUM

What happened

According to a filing with the Securities and Exchange Commission dated October 17, 2025, Range Financial Group LLC sold its entire stake in Fortinet. The firm liquidated the 29,944 shares it held, with the estimated value of the transaction based on the quarterly average price totaling $3.2 million. The fund now holds no position in Fortinet.

What else to know

The fund sold out of Fortinet, reducing its exposure from 1.2% of AUM as of June 30, 2025 to zero

Top holdings after the filing:

NYSEMKT: GJAN: $13.9 million (5.0% of AUM) as of Sept. 30

NASDAQ: NVDA: $10 million (3.6% of AUM) as of Sept. 30

NASDAQ: STX: $7.7 million (2.8% of AUM) as of Sept. 30

NYSEMKT: SPLG: $7.2 million (2.6% of AUM) as of Sept. 30

NYSEMKT: PJAN: $7.1 million (2.6% of AUM) as of Sept. 30

Shares of Fortinet closed at $83.44 on Oct. 17, 2025, up 3.2% over the past year but underperforming the S&P 500’s total return by 12.4 percentage points

Company overview

Company snapshot

Fortinet, Inc. is a global provider of integrated cybersecurity solutions, offering a broad product portfolio and scalable security infrastructure. The company leverages a mix of proprietary hardware and software to deliver robust network protection and threat mitigation for enterprises of all sizes.

It serves a diverse global customer base across telecommunications, technology, government, financial services, education, retail, manufacturing, and healthcare sectors.

The company generates revenue primarily through hardware and software sales, security subscriptions, technical support, and professional services, leveraging a channel partner distribution model alongside direct sales.

Foolish take

Range Financial sold its entire position after adding shares during the second quarter. During the June 30 through Sept. 30 period, the fund boosted its share ownership from 2.7 million shares to nearly 3.2 million shares.

However, the share sale follows the market’s negative reaction following Fortinet’s second-quarter earnings release on Aug. 6, sending the share price down nearly 22% the following day.

The company reported a 14% revenue increase to over $1.6 billion, the high end of management’s quarterly guidance. The company also reported adjusted diluted earnings per share of $0.64, exceeding its budgeted figure. Management also raised its annual EPS guidance.

Nonetheless, investors focused on Fortinet’s announcement that it has completed 40% to 50% of its planned firewall upgrade cycle. The higher-than-expected figure led to concern that many customers have already upgraded, limiting future revenue growth. Several analysts downgraded their ratings following the announcement.

Glossary

AUM (Assets Under Management): The total market value of investments managed by a fund or investment firm.
Liquidated: Sold off an entire investment position, converting it to cash.
Exposure: The proportion of a portfolio invested in a particular asset, sector, or market.
Channel partner distribution model: A sales approach where products are sold through third-party partners rather than directly to customers.
Stake: The amount of ownership or shares held in a company or investment.
Quarterly average price: The average price of a security over a three-month reporting period.
Reportable U.S. equity assets: U.S. stock holdings that must be disclosed in regulatory filings.
TTM: The 12-month period ending with the most recent quarterly report.
Security subscriptions: Ongoing service contracts providing access to cybersecurity updates and support.
Centralized management: A system that allows control and monitoring of multiple devices or services from a single platform.
Endpoint protection: Security solutions designed to protect devices like computers and smartphones from cyber threats.
Threat mitigation: Actions or technologies used to reduce or prevent cybersecurity risks.

As many stock market observers know, Warren Buffett‘s Berkshire Hathaway has been a net seller of stocks. The most notable sale has been Apple. That position made up over 40% of the portfolio at one time, but the share has since fallen to around 22%.

What investors need to understand is that the selling does not mean Buffett’s team isn’t buying stocks at all. One notable recent purchase has been Domino’s Pizza (DPZ -0.03%). The stock’s past gains and its value proposition have likely inspired this investment, and such optimism warrants a closer look at the business and the stock to see if it is a suitable choice for average investors.

Image source: Getty Images.

Berkshire Hathaway and Domino’s

Domino’s has returned more than 6,500% in stock gains and dividend payments since it went public in 2004. Most investors, including Berkshire Hathaway, have missed out on most of those gains, but Berkshire’s bets could indicate that significant upside remains.

DPZ Total Return Level data by YCharts

Buffett’s company began buying Domino’s shares in the third quarter of 2024 and has increased its position size in every quarter since that time. Today, it holds just over 2.6 million shares, or about 7.75% of the outstanding shares.

Another possible factor in Berkshire’s investment in Domino’s is that it is the world’s largest pizza chain, boasting 21,750 locations globally as of the end of fiscal Q3. Despite that success, investors may question why an investor would want to get into a business like pizza, which at least in theory, has low barriers to entry.

However, no other pizza business has grown to the same size, and one can find the kinds of competitive advantages that attract investors like Buffett when looking at Domino’s more closely.

One key part of Domino’s is its franchise model. This enables the chain to open a large number of locations with a relatively small amount of capital, leveraging high brand recognition to drive business.

Moreover, it offers a digital-first approach, which makes ordering easier and capitalizes on route planning for faster deliveries. Additionally, an efficient supply chain helps standardize food quality and costs, increasing consistency across locations.

Furthermore, despite a global footprint, Domino’s adapts its menu to suit local tastes, and new offerings such as parmesan-stuffed crust or added customization options keep its customers coming back to Domino’s.

The financial case for Domino’s

Buffett’s team was likely also drawn by its financial metrics. Indeed, with its global footprint, the maturity of the business appears to make it more of a value stock.

In the first nine months of fiscal 2025 (ended Sept. 8), revenue of $3.4 billion rose by 4%. Nonetheless, during that time, its free cash flow of $496 million surged 32% higher over the same timeframe. Gains on assets and lower capital expenditures bolstered that cash position.

Additionally, that free cash flow easily covered the company’s $119 million in dividend costs in the first nine months of the fiscal year. At $6.96 per share, its 1.6% dividend yield is well above the 1.2% average for the S&P 500. Buffett’s team also probably liked its 13-year history of payout hikes, a trend that makes further annual payout hikes likely to continue.

Investors should also take note of the pizza chain’s valuation. Its P/E ratio of 25 is below the company’s five-year average earnings multiple of 30. Also, since its P/E ratio has not fallen significantly below 25 since the early 2010s, one can assume that Domino’s stock sells at a reasonable price.

Should you follow Berkshire Hathaway into Domino’s stock?

Given the state of the company, investors can likely make a prudent move by following Berkshire Hathaway into Domino’s stock.

Indeed, a 6,500% total return over the stock’s history may cause some prospective buyers to shy away, particularly because of the competitive nature of the pizza industry.

However, Domino’s brand recognition and its focus on franchising, operational efficiency, and a robust supply chain give the company a competitive advantage. Moreover, investors can buy the stock at a relatively reasonable price and collect an above-average dividend yield.

In the end, even if Domino’s does not generate excitement, the stock is likely to cook up rising dividends and market-beating returns over time.

The S&P 500 index (SNPINDEX: ^GSPC) is trading near all-time highs. Since the Vanguard S&P 500 Index ETF (VOO 0.60%) tracks the S&P 500, it is also trading near all-time highs. And it could still be a smart move to buy the index via an investment in the exchange-traded fund.

But there might be a smarter choice, if you take valuations into consideration. Which is where another Vanguard exchange-traded fund (ETF) comes into play. Here’s what you need to know.

Just get started

One of the biggest things any investor can do is get started. So if you have $1,000 to invest and you’ve never done so before, it could be a very good idea to just buy the market. By default, that would be the S&P 500 index for most investors. And then you should just keep buying the market every single month to benefit from dollar-cost averaging.

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Since all of the products that track the same index basically do the same thing, the Vanguard S&P 500 ETF is going to be a top choice. With an expense ratio of just 0.03%, it is one of the cheapest ways to gain exposure to the S&P. Why pay more for the same basic service? As the chart below shows, the market has recovered from even the worst bear markets and then moved on to reach even higher highs.

^SPX data by YCharts.

If you have $1,000 or $10,000 (or even more) to invest, just getting started is going to be the smartest move. Then, keep going and never look back.

Sure, in the near term, you might suffer through some paper losses. But over the long term, history suggests you’ll still make out just fine. If buying when things are expensive is just too much for you, however, you might find that the Vanguard Value ETF (VTV 0.51%) is an even smarter choice.

Why go the value route?

A $1,000 investment in the Vanguard Value ETF will buy you around five shares of the exchange-traded fund. What you will end up owning is a portfolio of large U.S. companies that have valuations that are low relative to the broader market. With the S&P 500 near all-time highs, that’s not an insignificant issue.

Putting some numbers on this might help. The Vanguard Growth ETF (VUG 0.56%), the opposite extreme from the value ETF, has an average price-to-earnings ratio of around 40. That’s pretty expensive, but you would expect that, given its focus on growth.

The Vanguard S&P 500 Index ETF has an average P/E of about 29. Still pretty high, thanks to the fact that some very large technology stocks (which tend to be growth-focused) are driving its performance. The Vanguard Value ETF’s average P/E is a little under 21. It wouldn’t be fair to call 21 cheap, but it is most certainly cheaper than both the S&P 500 and Vanguard Growth ETF.

The same trend exists with the price-to-book-value ratio (P/B). The Vanguard Growth ETF comes in with a P/B ratio of 12.5, the Vanguard S&P 500 Index ETF sits at 5.2, and the Vanguard Value ETF is the lowest on the valuation metric at just 2.8. While it won’t necessarily save you from a bear market, focusing on value stocks when growth is in favor could soften the pain of a deep downturn.

Get started first, but consider a value component when you do

To reiterate the theme here, the most important investment decision you can make is to start investing in the first place. The second one is to keep it up even when times get tough on Wall Street. But if you have already made those choices, then maybe it makes sense to consider taking a more nuanced approach with what you choose to buy.

If all you have is $1,000 to start, perhaps consider splitting it between the S&P 500 Index ETF and the Value ETF, to lean you toward cheaper stocks. If you already have a portfolio, then the smartest move could be to put a grand into just the Value ETF to help diversify you away from the growth stocks that are leading the market into the nosebleed seats.

Quantum computing is becoming a popular investment theme in the market, but there’s just one problem: It’s still a few years away from commercial relevance. This makes it nearly impossible to predict which company will be a major winner in this field. Adding to the difficulty of quantum computing investing is that the technology is incredibly complicated and can be difficult to understand. However, not investing in quantum computing could be a massive mistake for your portfolio’s future returns.

So, what should investors do? One advantage investors can get in this investment sector is looking at which competitors have strong backers. Amazon (AMZN -0.61%) is one tech giant that is investing in this space and is backing one of the leading pure plays: IonQ (IONQ -3.92%). This gives IonQ a vote of confidence from one of the biggest companies in the world, making IonQ an intriguing stock to invest in.

Amazon owns a small amount of IonQ

We know that Amazon is investing in IonQ from its Form 13F, which informs investors what other stock holdings Amazon has because its investment portfolio is greater than $100 million. As of its last report filed for Q2 holdings, Amazon holds nine stocks, with IonQ being one of them.

Amazon holds just over 850,000 shares of IonQ. While that may sound like a lot, that’s only about 0.3% of IonQ’s total shares outstanding. So, Amazon isn’t a controlling party in IonQ; it’s just an investor like you and me (although it has a lot more capital than you and me).

Just because Amazon doesn’t own 10% or so of the company doesn’t mean this isn’t an insignificant investment. Amazon clearly likes what it saw, and with Amazon having more technical prowess than the average investor, I think this makes IonQ an intriguing quantum computing investment.

One thing that sets IonQ apart from its competitors is the path it’s taking. While most quantum computing players are using superconducting technology, which requires cooling a particle to nearly absolute zero, IonQ uses a trapped-ion approach, which can be performed at room temperature. Furthermore, the trapped-ion technique is inherently more accurate than superconducting, which is a trade-off for slower processing speeds.

Because the biggest hurdle in quantum computing technology is accuracy, I think IonQ is one of the more compelling investment options right now, as it is the leader in this category, holding two world records.

This makes IonQ my top option in the quantum computing investment world. But is the stock worth buying right now?

An investment in IonQ will be volatile

IonQ has had an incredible run over the past few months as quantum computing investing has risen in popularity. The stock is up around 90% since the start of September, which is a massive movement considering that we’re still years away from viable quantum computing technology.

Most companies in this realm point toward 2030 as the turning point for quantum computing adoption, and IonQ is no different. Earlier this year, IonQ’s CEO Peter Chapman gave investors the projection that the company will be profitable with sales approaching $1 billion by 2030. That’s still five years away, which is a long time to wait and hold the stock to see if IonQ is an eventual winner in the quantum computing arms race.

With how much attention quantum computing has gotten in recent weeks, it’s impossible to tell where the stocks involved in this sector will head. It’s possible that there is a quantum computing investing mania ongoing, and the stocks continue to rise at an irrational pace.

It’s also possible that the stock could be ripe for a sell-off, especially after the past few weeks of strong gains. However, as long-term investors, we need to avoid that noise. If you’re buying IonQ stock now, you need to have the mindset of buying and holding through at least 2030, regardless of what the roller coaster ride of the stock market is like.

If you’re confident in IonQ, buying today makes sense, but your measure of success cannot be the stock price; it must be the company’s announcements. If IonQ wins the quantum computing arms race, the stock will be a winner over the long term, but keep in mind that it will be incredibly volatile along the way.

If you’re looking for a low-maintenance income-generating investment that you can buy and hold indefinitely, an exchange-traded fund (ETF) is an obvious choice. And you’ve certainly got plenty of options.

Not all dividend ETFs are the same, though. There are better options than others. In fact, if you’re looking for a great all-around dividend-paying exchange-traded fund to buy and hold forever, one stands out above them all.

And it’s probably not the one you think it is.

More to the matter than mere yield

If you’ve done any amount of digging into dividend ETFs as a category, then you likely already know that the Schwab U.S. Dividend Equity ETF (SCHD 0.79%) currently boasts a trailing yield of 3.9%. That’s huge for a fund of this size and ilk (quality blue chip stocks), even topping the 2.5% yield you can get from the Vanguard High Dividend Yield ETF (VYM 0.44%) at this time.

Image source: Getty Images.

There’s more to the matter than merely plugging into a fund when its yield hits a particular number, however. Is the current dividend sustainable? Does it have a history of growing its payouts enough to keep up with inflation? Is the ETF also producing enough capital appreciation? When you start asking these questions, the Schwab U.S. Dividend Equity fund doesn’t exactly shine. It has underperformed the S&P 500 (^GSPC 0.53%) as well as most of the other major dividend funds since 2023, for instance, mostly because the Dow Jones U.S. Dividend 100 index that it mirrors doesn’t hold many — if any — of the tech stocks that have been lifted by the artificial intelligence megatrend.

That’s not inherently a bad thing, mind you. There may well come a time when these technology stocks struggle more than most while demand reignites for the components of the Dow Jones U.S. Dividend 100. Nevertheless, even factoring in its above-average dividend, the Schwab U.S. Dividend Equity ETF’s lingering subpar overall performance has made it tough to own for a while now. There’s also no obvious reason to think that relative weakness will soon end.

The best all-around choice

So which fund is the ideal all-around buy-and-hold “forever” dividend ETF? For many income-minded investors, it’s going to be the iShares Core Dividend Growth ETF (DGRO 0.53%).

It’s not a particularly popular fund. It has less than $35 billion in its asset pool, for perspective, versus more than $100 billion for the massive Vanguard Dividend Appreciation ETF (VIG 0.27%). Schwab’s U.S. Dividend Equity ETF is more sizable as well, with about $70 billion under management. You can also find yields better than DGRO’s current trailing yield of just under 2.2%.

Don’t let its smallish size and average yield fool you, though. The iShares Core Dividend Growth ETF packs enough punch where it counts the most. And it’s capable of packing this punch indefinitely.

This fund tracks the Morningstar US Dividend Growth Index. Like all of Morningstar‘s dividend growth indexes, this one only includes companies that have a track record of at least five straight years of annual payout hikes. It also excludes the highest-yielding 10% of stocks based on the premise that an unusually high yield can be a warning that trouble’s brewing for a business. In this vein, the index also excludes stocks of companies that pay out more than 75% of their earnings in the form of dividends.

Where the Morningstar US Dividend Growth Index really differentiates itself, however, is in the size of each position it holds. Although no holding is allowed to make up more than 3% of its total portfolio, its positions are weighted in proportion to the value of the stocks’ dividend payments. End result? This ETF’s biggest positions right now are Johnson & Johnson, Apple, JPMorgan Chase, Microsoft, and ExxonMobil. That’s an incredibly diverse group of stocks, although the fund’s other 392 holdings aren’t any less diverse.

Sure, many of these holdings don’t exactly boast massive dividend yields. Plenty of them do have impressive yields, though, and the ones that don’t are supplying value via price appreciation. It’s the balanced weighting of these different kinds of stocks that makes this ETF such a reliable overall performer.

The irony? Despite holding many low-yielding tickers of companies that don’t exactly prioritize their dividend payments, this fund’s quarterly per-share payment has nearly tripled over the course of the past decade. You’d be hard-pressed to find better from an ETF that also produces this kind of capital appreciation.

No compromise needed

None of this is to suggest that it would be a mistake to own any other income-focused exchange-traded fund. There are perfectly valid reasons for investing in something like the Schwab U.S. Dividend Equity ETF at this time, for instance, such as an immediate need for an above-average yield. It’s also not wrong to own more than one kind of dividend ETF, diversifying your investment income streams.

If you just want a super-simple dividend income option that you can buy and hold forever, though, the iShares Core Dividend Growth ETF is a fantastic but often overlooked choice. Unlike too many other investment options, with DGRO, you don’t have to sacrifice too much growth in exchange for reliable dividend income, or vice versa. It’s a balance of (nearly) the best of both worlds.

The only thing you can’t really get from the iShares Core Dividend Growth fund is a hefty starting dividend yield, but most long-term investors will consider that a fair trade-off.