The AI and semiconductor sectors have reclaimed market leadership, highlighted by Nvidia (NVDA) reaching an all-time high this week. This momentum has extended to the broader equity markets, with major indices also reaching record levels. Optimism is being driven by expectations of a potential Federal Reserve rate cut sooner than previously anticipated, coupled with optimism of trade deals, and a (at least) temporary easing of geopolitical tensions.

However, while market optimism is undoubtedly a positive signal, it also warrants a more measured and discerning approach. The current rally comes against a backdrop of historically elevated valuations. Investors prioritizing momentum over fundamentals may get burned when the next speed bump comes along.

Market history is replete with episodes where euphoric sentiment led to excessive risk-taking, only to be followed by sharp corrections once valuations reverted or macro conditions shifted. Should the anticipated rate cuts be delayed, inflation rise more than expected, or geopolitical risks re-escalate, these overvalued stocks could face outsized drawdowns.

Investors would be wise to balance participation in the rally with discipline, prioritizing companies with durable cash flows, quality fundamentals, and valuations trading at a discount. In times of exuberance, prudent risk management and fundamental analysis are not just recommended, they are essential.

Our proven-superior fundamental research gives you the edge needed to navigate the ever-changing stock market.

Here’s a summary of our published research this week.

Our CEO David Trainer hosted a training on how our stock screening tools scan the entire market to find the best and worst opportunities. He notes how just one stock in the defense sector passes our tests. He shows exactly how all the noise in the market makes it harder to find good stocks and how our research gives you an edge.

FREE Stock Pick: We shared a free stock pick from our Safest Dividend Yields Model Portfolio. 

Our latest Long Idea benefits from long-term industry tailwinds, possesses operational efficiency advantages, returns significant capital to shareholders, and, best of all, its stock trades at a steep discount.

On the Model Portfolio front, we updated our Dividend Growth Stocks Model Portfolio – available to Pro and higher members.

Links to all our newly published research are below along with a preview for next week’s research.

We hope you have a great week!

Long Idea: From Sand to Profits

Members can read the latest Long Idea here.

The Singular Opportunity in the Defense Sector – Watch the Replay

Free Stock Pick from Our Safest Dividend Yields Model Portfolio

Dividend Growth Stocks Model Portfolio Update for June 2025

Danger Zone Podcast: 6/16/25: Why Dividend-trap Stocks Are in the Danger Zone

Upcoming Research