2024 Valuation Update and Educational Guide: DCF Conclusion Studies Model Updates of Top 10 QQQ ETF Stocks
Members: Bookmark for Future Reference.
Note: While this Strategy Note has practical insights to apply, I have also structured this piece to provide education so that Members understand how to use DCF Modeling in understanding how to value a stock based on fundamental data.
Hi Everyone -
This strategy note is a Fundamental Update on my DCF Conclusion Studies on the top 10 weighted companies within NQ (QQQ ETF Equivalent) after this latest earnings season. If you are a Member, please bookmark this email as it will help you as a valuable reference point for valuation on the most important stocks within the Nasdaq-100.
The companies that have not reported yet this season are Nvidia (5/22), Costco (5/30), and Broadcom (6/12). However, Analyst estimates are included in this note and this page will be updated accordingly once these 3 companies report.
Mag 7 attributes about > 30% of NQ’s weight, and other Key Companies within Semiconductors and Costco play another 15%.
By updating the DCF models of the top 10 stocks within NQ, I have a better understanding of “support” and “resistance” on this index when I trade it on an intraday basis and when I invest in the QQQ ETF on swing/intermediate-term timeframes.
I will go through Analyst revenue and EBITDA revisions and share a Conclusion Table at the end while comparing my findings from my March DCF Conclusion Study table.
By knowing the fundamental story, the fair value of companies, and their trading ranges that are highly weighted in NQ (the tradable futures proxy of QQQ ETF), I will do my best to put our Members in the strongest possible position to understand the technology sector.
Case in Point: I mentioned with rather firm language that Meta must not be feared at 430 post-earnings. During time sensitive trading environments, please allow me to extremely brief with my conclusions. All I may have time to say is “I like it at this price.”
Meta traded as high as 480 last week. $50/share higher than our reference point.
My Conclusion was drawn from an updated DCF Model I had crafted shortly after earnings.
Below, we discuss which top 10 stocks within QQQ ETF (Nasdaq-100 proxy) are Fairly Valued and which is Over-Valued to give a holistic clear picture of where we are in the risk/reward spectrum.