Alpha Prime Capital

03/23/2026

The last few weeks have been news whiplash on the daily. So many statements made and then contradicted shortly after, sometimes in the next sentence. In times like this, it is best to just ride it out. As we saw this morning, one tweet and the market could rally hard. Eventually the rally will continue. The UK's Keir Starmer welcomed talks between the US and Iran - and revealed he was aware they were taking place, which gives Trump's tweet this morning credibility. No one wants this war to go on any longer than it has to, so a deal should be made soon.

Things like this happen from time to time. The trick is to not get scared out of your investments at the wrong time. This discomfort is the price of admission to make a nice return over the long run. Usually it isn't the President that loves to tout how much the stock market is up, continuing to make decisions that push it lower, but that's the world we live in, unfortunately. Top picks: $AMZN $APO $BX $CPNG $DKNG $FOUR $GPN $JD $KKR $MELI $META $MNDY $MSFT $NU $PDD $PINS $PYPL $OWL $RDDT $ROOT $SE $XYZ

03/08/2026

We try to stick to markets and stay out of politics, but we cannot keep our mouth shut any longer. America continues to fall down a dark path led solely by one man and his administration. The leadership in Iran were terrible people lacking a moral compass, however our moral compass points more in the wrong direction by the day. Are we now bombing schools and lying about it? Are we causing WW3 in the Middle East with no real plan whatsoever? We have a pseudo-military state of ICE officers that go around harassing US citizens and in some cases, executing them while they are unarmed and on the ground. We went from the world's protector to the world's bully. America is the best country in the world, but if we continue to allow such a disgusting and vile man to consistently make stupid and morally wrong decisions, we may not remain that way. We need a real leader. Someone who brings us together. Someone who doesn't deny science or other facts. Not a hateful individual who is more concerned about enriching his family and attacking his political enemies than putting the nation on the best path possible. Get out and vote this November!

02/23/2026

Updated fundamental metrics of my current top picks $AMZN $CPNG $DKNG $FISV $FOUR $GPN $JD $MELI $META $MNDY $MSFT $PDD $PINS $PYPL $RDDT $SE $XYZ and another chart of popular stocks.

02/14/2026

I've talked about the market $SPY $QQQ impact from pods (https://trustnet.com/news/13451872/the-rise-of-pod-shop-trading-why-hedge-funds-like-citadel-and-millennium-are-redefining-wall-streets-approach-to-valuation) and other momentum-based strategies in the past. Here are some more details on the subject...

The Illusion of Diversification
While "pod shops" (like Citadel or Millennium) aim for unique strategies, they often converge on the same momentum signals. By prioritizing technical trends over fundamental valuations, these pods act in unison: buying uptrends and selling downtrends regardless of a stock's actual worth. My professor Andrew Lo (read his book Adaptive Markets: Financial Evolution at the Speed of Thought if you haven't) once received calls from several former students in the same week when the market seemed normal on the surface. They all worked on different teams at different firms that supposedly had different strategies, but they asked if he heard of anything weird going on, as all had suffered large, unusual losses at the same time. This creates hidden correlations when they are supposedly "different" strategies.

Market Distortion and Vicious Moves
The massive growth of leveraged, market-neutral pods has turned heavyweights like silver and MSFT into "meme stocks." Because these traders focus on momentum and ignore fundamentals, we witness fundamental contradictions.

Irrational Rallies
Walmart $WMT climbs to a 47x forward P/E despite minimal revenue and earnings growth going forward because it is in an uptrend. Exxon Mobil $XOM is getting close to double the stock price of spring 2022, despite the company's net income falling from $59B in 2022 to $27B expected for 2026.

Irrational Sell-offs
Fundamentally strong and growing, high-cash-flow companies like $PDD or $JD (over 20% FCF/EV yield expected for 2026 that is growing) are discarded simply because they are in a downtrend.

Sector Contradiction
Defensive staples $XLP and utilities $XLU are outperforming simultaneously with highly cyclical sectors, industrials $XLI and energy $XLE. This move defies fundamental logic but is simply following momentum flow. The pods need to pair their current tech shorts with long positions to stay market neutral. This is why you see some stocks crashing like it is early April 2025 despite the overall index not in freefall, and XOM rallying like oil is going back above $100 to remain there forever, despite no major move in the commodity.

The Shift: Traders vs. Investors
The market's DNA has changed; it is now dominated by traders rather than investors. In the past, fundamental investors would step in to buy bargains in a downtrend, providing a floor. Today, momentum strategies control the narrative and will continue selling this bargain due to the downtrend. Bubbles get bought and bargains get sold. While this disconnect causes extreme short-term "whackiness," long-term performance will ultimately be anchored by earnings and free cash flow.

02/12/2026

Top picks: $AMZN $CPNG $DKNG $FISV $FOUR $GPN $JD $MELI $META $MNDY $MSFT $PDD $PINS $PYPL $RDDT $SE $SM $XYZ

The volatility in individual stocks continues despite the index holding relatively calm. How is that happening? Why did $SHOP fall close to 30% in an hour on good results? Why did silver $SLV fall roughly 40% in 24 hours? Covid started the initial change, but the market has become more chaotic over time. More and more people (and computers) are trading. Less and less investing. This is how we end up with a market that is broken from a fundamental perspective and continues to break down as time progresses, moving further away from Warren Buffett and closer to Wall Street Bets. Society has become gamified and the markets have joined in as a momentum casino.

Although retail traders are becoming a larger force, the biggest reason for the warped market and insane volatility under the surface are pods (https://www.trustnet.com/news/13451872/the-rise-of-pod-shop-trading-why-hedge-funds-like-citadel-and-millennium-are-redefining-wall-streets-approach-to-valuation) and other quant momentum strategies. They do not care about fundamentals. They are just trading day to day (and sometimes millisecond to millisecond) based on charts and their only objective is to make money right now. This results in stocks wildly swinging to levels in both directions that fundamentals do not support.

The reason pods are the bigger driving force is that they like to stay market neutral. Retail trades in one direction. Pods are largely behind shorting software $IGV recently. They need to pair their short with a long to avoid making directional bets on the overall market. Are stocks like $JNJ, $KO, and $XOM up a lot YTD because their businesses have fundamentally changed dramatically? Not at all. In 2022 $XOM net income was $59B and the stock was around 80 when oil spiked in the spring/summer. In 2026 they are supposed to have a net income of $27B and the stock is 154. Huh!?! They just needed something to go long against their short. These types of stocks are the opposite of software and had nice looking charts. In Covid it was a small set of fringe companies that were meme stocks. Now they have turned $XOM and so many other large cap companies into meme stocks.

So what is one to do? Have conviction in everything you do. Have a plan. What are you going to do if your stock falls 5% tomorrow for no reason? Having conviction helps you stay in an investment when it is moving against you in the short term. When people like Tom Lee or Dan Ives come on CNBC, they just spew out buzz words and nonsense. They never discuss fundamentals in great detail (especially Dan Ives). Tom Lee was calling for bitcoin to make an all-time high by the end of January. It did the complete opposite. Being wrong is ok. I have been wrong a lot before and will be in the future, but his call was based on feelings and not facts. That is what makes it bad. In general, sell-side analysts have become momentum chasers. Look at their company estimates as those are still worthwhile, but they will just turn a valuation multiple up or down to get their price target close to where it is currently trading.

Fundamentals are all that matter in the long term. When I look for an investment, I look at the overall business and the estimates. What if the estimates are wrong? That is a risk with any firm, especially smaller companies. I won't invest in something unless it would still be a wise investment if the estimates were moderately too high. Seek out a margin of safety.

Stay diversified. If you were heavily concentrated in software, you were quite happy until very recently. Now you are living a nightmare. Given how chaotic the market has become, doing extensive research on a high conviction bet isn't enough. Stocks like $PDD and $JD are growing firms that trade at over a 20% FCF/EV yield and net cash balance sheets. Should this be possible? No. But that is where they trade today. Despite AI making progress on improving the efficiency of overall society, it has somehow made markets less efficient.

Keep your humility. There will be times when you feel like you can't lose. Other times it will feel like you can't win. These are extremes and neither lasts forever. Don't shape your viewpoint on an extreme.

If you are emotional, don't make any big moves. Some people will revenge trade and take on oversized positions when they are angry. Others panic sell wise investments at the worst times. Avoid both.

Stay disciplined. Some companies deserve premiums over others. Some companies are more cyclical than others. Know where your investment falls in this, but never overpay for something just because it has a cool story and a nice chart. That is what happened to software. No one cares about valuations when they are making money. It can get ugly quickly when things turn without valuation support.

I included a table of my top picks and of popular stocks. Although I like all of my top picks, my top 5 for buy and hold secular growers would be $JD $PDD $SE $CPNG $MELI. Some on my list are secular growers and others are more stagnant companies in an investment year that are trading at ridiculously cheap levels. Crazy these stocks are trading where they are while people are piling into $WMT with almost no growth and a 1.3% FCF/EV yield. Objectively, everything on my best ideas list is better than almost everything on the popular stocks list, sometimes by a gigantic margin. There are some stocks like $NFLX that look intriguing on the popular stock list, but generally speaking, the majority are bad investments. Yes, a lot of them are dominant players and deserve a premium, but the premium has gotten out of control. You are better off buying a bond than $WMT stock at this price. I don't know when the stocks on my best idea list will start working, and not all of them will work as I expect, but in the long term I am confident they will outperform the overall market on average.

02/01/2026

A table of my top picks and popular stocks. I look at all company fundamentals, but the three highlighted metrics are the most important by far and tell most of the story. $CPNG $DKNG $FISV $FOUR $GPN $JD $MELI $MNDY $NU $PDD $PYPL $SE $SM $XYZ. They vary with some more hyper growth and others slower growing with strong FCF generation. I focus on higher quality balance sheets and what has the highest FCF/EV yield that will continue to produce. How much FCF a business will generate over its lifetime is all that matters.

Some truly remarkable deals out there that shouldn't exist imo. $PDD and $JD stand out the most, but all look great. Interesting that $PYPL gets downgraded by every analyst as a "melting ice cube" but the same analysts have its FCF continuing to grow going forward. Some businesses have less cyclical earnings and a larger moat that should command a premium, so that must factor into the equation. Other factors as well. But at the end of the day every narrative thrown around should be baked into estimates. Focus on math, not a sexy story. Of my top picks, the stocks most likely to be compounders are $PDD $JD $SE $MELI $CPNG. You have a reasonable valuation combined with a longer runway of FCF growth.

A great company does not always equal a great investment. $PLTR $CRWD $TSLA are all way too expensive relative to their growth. $WMT $HD $COST $WM $KO have wider moats, but terrible FCF/EV yields with little growth. $SBUX $CMG $NKE have less wide moats and bad FCF/EV yield. $NVDA $MU $SNDK look decent on peak earnings but they still remain cyclical, especially $MU $SNDK. $NVDA is much higher quality. Hyper scalers can't spend forever. You should be getting more than 10% FCF/EV yield at peak cycle but you don't. The boom is here. The bust will hurt.

Of the popular stocks listed, I like $META, $AMZN, and $MSFT the most. Analysts still have capex moving higher perpetually for these, but I don't see that as the case. Once they get enough chips they won't need to replace them every single year. FCF is dampened right now.

Another thing I look for is cash from operations vs. interest expense. This demonstrates how much of a buffer there is with cash coming in to pay the interest in case things slow down. The higher the better. I also prefer FCF/EV over FCF/MC. This gives the complete picture of the company. Sometimes a stock may look very good using FCF/MC but could have some red flags like huge debt not shown.

01/28/2026

Absurdly cheap stocks I like. This is 2026 FCF yield on enterprise value, not market cap. Many of these are still growing rapidly, with FCF in 2027 supposed to grow 19% for $PDD, 25% for $MNDY, 31% for $JD, 31% for $XYZ, and 33% for $CPNG. Haven't ever seen so many stocks this cheap with so many bubbles at the same time. Pods, retail, and many other trading-oriented strategies have warped the fundamental landscape and gotten us here, but incredibly rewarding opportunities are there for long-term investors. Truly a bizarro world all around us.

$SM 29%
$PDD 21%
$JD 20%
$PYPL 13%
$MELI 9%
$GPN 9%
$FOUR 8%
$MNDY 8%
$XYZ 8
$FISV 6%
$SE 6%
$CPNG 5%

01/14/2026

I have mentioned the gamification of markets (and society as a whole) many times before. Recently, I listened to an interesting podcast by Ricky Sandler that confirmed a lot of what I was personally observing. Today the market is dominated by short term “investors” (aka traders) who don’t care about the business; they care about the stock. What is the story? What is going to push the stock up today? No longer are most people looking for long-term opportunities at attractive valuations. Pod shops and retail investors now dominate trading volume and as a result, price movement in the short term. Many can’t or won't own things with negative momentum, which amplifies the downside. Someone could be selling a dollar for fifty cents. If it is in a downtrend, they won't touch it. This creates opportunity that will take longer to capitalize on in a gamified market than usual, but being patient is key and will be rewarded. Top picks at the moment: $JD $PDD $MELI $CPNG $SE $META $CMCSA $CHTR $SM $PYPL $FISV $FOUR $GPN

12/26/2025

Top picks for 2026: $JD $MELI $SE $CPNG $CMCSA $CHTR $AMZN $META $UBER $NVO $PYPL $FISV $FOUR $PDD

12/09/2025

Current top picks based on fundamentals: $CMCSA $CHTR $JD $PYPL $FISV $FOUR $NVO $CNC $AMZN $META $CPNG $MELI $SE

11/05/2025

How the hell is PLTR at this valuation? Are we in the 2021 meme craze? Is this 1999? Will my value stocks ever work? My take on it all is included in a monthly letter I usually only send to clients, but I wanted to share this one with the public. I can't upload Excel files here, so you need to download both the letter and the accompanying Excel file from the APC website:

  The Alpha Strategy  Download Monthly Letter   Download Monthly Letter Excel Sheet The Alpha Strategy is an aggressive investment strategy consisting primarily of individual equities with an options overlay. The overall objective is to outperform the U.S. equity market (S&P 500) over the long ru...

10/15/2025

If you’re a professional trader riding the wave in a bubble, that’s a different story, but there are three big issues with today’s “investors” new to the game.

They don’t look at valuations. Not looking at valuations is like someone telling you a 7 series BMW is an amazing car and you buying it without asking the price. The car starts around $100k retail. If you are buying it for $50k, that’s an amazing deal. Unfortunately most bubble participants are buying this car for $1M thinking they are a genius. You are simply currently winning the greater fool’s contest.

The second issue is gains are being pulled forward a decade in advance. Even sell-side analysts are guilty of this. That’s not how things work. If you pull forward gains dramatically, you’ll never make any money even if the story you bought into plays out similar to your wildly optimistic projections. It would be like me saying I’m going to build the best clothing brand in the world and giving my firm a $50B valuation even though I don’t have any products as of now. More than a leap of faith being taken by many that will end in a free fall.

The third issue are these overly optimistic projections. Even if a firm is in a rapidly growing industry, that doesn’t mean anything. $INTC was the biggest semi firm in the world and has lost out to competitors for decades. Being in a rapidly growing industry doesn’t mean the firm will be successful. There will be lots of competition that may provide a better good or service, or the firm could simply just be poorly run and not do well due to a self-inflicted wound.