This ad from Ian Wyatt has been running for a little while, with some apparent variation, but he keeps aggressively re-pushing it as a “new” webinar, so our readers keep asking about it, and I haven’t covered the tease yet… so that’s our project for today. What are those top five stocks he keeps teasing?
Well, I sat through the webinar so you don’t have to (like many publishers, Wyatt seems to have been inspired by the time share industry… force people to sit through a two-hour seminar, and some of them will buy anything you pitch just to make it stop), and I sifted out the clues to feed to the Thinkolator… so we’ve got five answers for you.
You can go subscribe to his Million-Dollar Portfolio ($995, nonrefundable) if you’d like to, but don’t throw your money down just to learn some “secret” stock picks… that’s what we’re here for, to help you get answers so you can take the time to do your own research, and get rushed into a big commitment (or have your opinion about those five stocks biased by the fact that you just ponied up a thousand bucks to learn what they are).
The basic spiel is that 5G is coming, which we’ve certainly heard before from pretty much every tech pundit over the past two years… and that Wyatt has the best stocks you can buy for huge gains, since the “usual suspects” like Verizon, AT&T, Apple or Qualcomm won’t give you the big returns you might enjoy from smaller stocks.
He describes his ideas as “a handful of 5 undiscovered technology stocks that stand to reap a fortune.”
And the ad has been introduced in a bunch of different ways in recent weeks, but the two big picture pushes are that Apple will release its 5G iPhone later this year, sending a lot of attention to this sector again and increasing demand dramatically, and that President Trump is really excited about 5G and keeps talking about America “winning” the 5G race, so the government will keep pushing for a faster rollout of the technology.
And we’ve got five stocks (or maybe six) to take a quick look at, so I’ll jump right in.
The first one is teased here:
“One tiny company could be a secret supplier for Apple’s new 5G products. And shares could explode as 5G goes mainstream.”
And he also says it’s “The Top Stock Enabling 5G for Apple, Amazon and Samsung.”
So what other clues do we get?
“California semiconductor company with a brand new idea… created chips that weren’t made for a specific purpose, but were more like a blank sheet of paper…
“That was a novel idea when they IPO’d 25 years ago.”
This “blank sheet” chip is, we’re told, a “key component to any 5G device, being used in phones, towers and modems.”
And they’re a confirmed supplier to Alibaba, Amazon and Samsung
Then Wyatt goes out on a bit of a limb:
“May be an exclusive supplier to the new iPhone 12… could be a key component that allows Apple to launch and compete with Samsung.”
Once the tear-down articles are written when people take the new iPhone apart, surprising new components or chips that are found in the phones sometimes lead to stock prices surges — and Wyatt expects this stock to jump higher when that happens.
So what’s the stock? Thinkolator sez we must be looking at Xilinx (XLNX), the leading developer of Field Programmable Gate Array (FPGA) chips — essentially, programmable semiconductors that, unlike purpose-built chips, can be repurposed after installation.
You don’t usually see these kinds of chips in a phone, mostly because they are expensive — the typical evolution of technology tells us that FPGAs are used in new technologies when they’re first introduced, so that the company developing that new product can tinker with the settings to optimize the operation of the chips, but then once they’ve figured out what works best they quickly replace those FPGAs with chips specifically designed to meet their need… which are generally cheaper and smaller and more efficient.
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Apple did include a low-end FPGA in the iPhone 7 several years ago, though I haven’t heard of one being in any other model, and that FPGA was actually from Xilinx’s biggest competitor, Lattice Semiconductor (LSSC). So I suppose Lattice could almost be a match as well, though Xilinx is the one who will claim to have invented the technology… and Lattice is actually based in Oregon, not California. Both companies, incidentally, went public in 1989, so neither one had their IPO “25 years ago” (I know, 1989 was 31 years ago? I’m as shocked as you are.) There are really only three big players in the FPGA business, incidentally — the other one is Intel (INTC).
Xilinx is an interesting stock and they should be expected to have their highest potential during times of big technological leaps forward, so they have certainly been teased as a 5G stock before (most recently when Ray Blanco called them the “stock fo a lifetime” in January) — the argument being not that the chips will be in phones, but that they’ll be in all the base stations and networking equipment because that’s where the tinkering and adjusting will be taking place. I owned the stock a while ago and got stopped out at $100 last fall, but it is looking relatively appealing again recently, particularly if they can convince more people to use their FPGAs and other advanced chips in AI projects and data centers instead of just using them to bridge the gap before customized chips can be designed for particular applications.
The growth that had been expected for Xilinx has been pushed off into the future a bit, they were suffering from the loss of Huawei as a customer when that company was blacklisted, and in general are hurting with the pressure on US/China trade, but if you add on the slowdown across most businesses with the coronavirus the impact gets pretty dramatic, the expectation is that earnings will drop by about 20% this year on a 10-15% drop in revenue before resuming growth next year (and more important for the stock price, dropping by about 50% from the earnings that had been expected a year ago). If that works out as analysts expect, then you can justify the valuation now at about $90, but it’s not cheap and things are