"Patience is a Super Power" - "The Money is in the waiting"
Showing posts with label nVidia. Show all posts
Showing posts with label nVidia. Show all posts

Wednesday, July 23, 2025

Why do Nvidia and so many institutional investors own most of the shares of RXRX - Recursion Pharma

 


Why Nvidia Invested in RXRX

1. Deep AI Integration for Drug Discovery

  • In July 2023, Nvidia invested $50 million via a PIPE deal to help Recursion accelerate training of AI models for drug discovery. This investment boosted RXRX stock by about 83% immediately Reuters

  • Nvidia provided cutting-edge GPUs and access to its BioNeMo generative-AI cloud platform so Recursion could train models on its massive biological dataset MarketWatch+2.

2. Equity Stake & Strategic Synergy

  • Nvidia now holds over 7.7 million shares—approximately a 3–4% stake—making Recursion one of its top non-core holdings The Times+11

  • This aligns with Nvidia’s broader strategy of investing in AI-first companies that complement its hardware, not just selling chips.

3. Accelrating RXRX’s Supercomputer Ambitions

  • Recursion built BioHive‑2, a supercomputer powered by Nvidia’s DGX H100 GPUs. It delivers a 4x speed increase over their prior system, enabling faster model training Reuters+2T

  • This partnership helps validate Nvidia hardware in high-performance biotech applications—which can drive future sales to pharma partners.


๐Ÿฅ Broader Vision: Redefining Pharma with AI

  • Recursion uses AI, automation, and robotics to develop drugs more quickly and affordably. Its platform includes the “virtual cell” paradigm and is backed by major pharma companies like Bayer and Roche Investors+14.

  • Analysts project RXRX revenue growing at a ~65–73% CAGR through 2027—significantly above typical biotech growth—with Nvidia’s backing lending extra credibility The Motley Fool+5

✅ Summary

Nvidia's investment in RXRX is twofold:

  1. Financial Buy-In – it gains exposure to a high-growth biotech using AI and fosters long-term capital appreciation.

  2. Strategic Alignment – Nvidia deepens integration of its AI stack (hardware + BioNeMo) in the drug discovery workflow, while demonstrating its systems’ performance in real-world pharma applications.

It’s part of a broader strategy of deploying capital into AI-first companies that can both benefit from and validate Nvidia’s ecosystem, accelerating adoption across industries.


Here are the top ten institutional investors in Recursion Pharmaceuticals (RXRX), based on the most recently reported 13F filings (as of March 31, 2025) and aggregated data sources Yahoo Finance+12:


๐Ÿฆ Top 10 Institutional Holders of RXRX

Ranked by percentage ownership:

  1. ARK Investment Management LLC — 8.66% (~34.8M shares; ~$184 M) 

  2. Vanguard Group Inc. — 8.03% (~32.3M shares; ~$171 M) 

  3. Lux Ventures IV LP — 7.46% (~30.3M shares; ~$194 M) 

    1. Baillie Gifford & Co. — 6.07% (~24.4M shares; ~$129 M)
  4. BlackRock Inc. — 5.78% (~23.5M shares; ~$150 M) 

  5. SoftBank Group Corp. — 3.61% (~14.7M shares; ~$94 M) 

  6. Kinnevik AB (publ) — 3.30% (~13.4M shares; ~$86 M) 

  7. State Street Corp. — 3.22% (~13.1M shares; ~$84 M) 

  8. Mubadala Investment Co. PJSC — 3.19% (~13.0M shares; ~$83 M) 

  9. Novo Holdings A/S — 2.38% (~9.7M shares; ~$62 M) 

๐Ÿงพ Summary Table

Investor% OwnershipApprox. Shares
ARK Investment Management LLC8.66%~34.8 M
Vanguard Group Inc.8.03%~32.3 M
Lux Ventures IV LP7.46%~30.3 M
Baillie Gifford & Co.6.07%~24.4 M
BlackRock Inc.5.78%~23.5 M
SoftBank Group Corp.3.61%~14.7 M
Kinnevik AB (publ)3.30%~13.4 M
State Street Corp.3.22%~13.1 M
Mubadala Investment Co. PJSC3.19%~13.0 M
Novo Holdings A/S2.38%~9.7 M

๐Ÿ’ก Key Insights

  • Institutional investors control around 75% of RXRX's outstanding shares Nasdaq+

  • ARK and Vanguard are the two largest, with each holding over 8% of the company.

  • Lux Ventures IV LP—a prominent insider-linked investor—is effectively the third-largest stakeholder at ~7.5%.

  • Other heavyweights include Baillie Gifford, BlackRock, SoftBank, and sovereign/strategic holders like Mubadala and Novo Holdings.


Here’s a breakdown of the recent moves by institutional investors in RXRX:


๐Ÿ“ˆ Increased Positions (Recent Quarter)

  • UBS Asset Management Americas (UBS AM) added 4.15M shares (+183.7%) in Q1 2025 (~$22M) MarketBeat+

  • UBS Group AG boosted its stake by 2.57M shares (+85.4%) (~$13.6M) 

  • According to CapEdge filings (as of July 22, 2025):

    • KLP Kapitalforvaltning AS increased by +20% (~61K shares)

    • Steel Peak Wealth Management up +21% (~85K shares)

    • Prime Capital Investment Advisors boosted by +61% (~30K shares)

    • IMC‑Chicago surged +76% (~284K shares) 

๐Ÿ“‰ Reduced or Exited Positions

  • RA Capital Management, L.P. fully exited its position, selling 7.73M shares (~$41M) in Q1 2025 

  • CapEdge data shows QRG Capital Management reduced its holding by 32% (~19K shares) as of July 21, 2025 

๐Ÿ” Additional Context

  • Total institutional inflows over the past 24 months reached significantly more than outflows:

    • 83.2M shares purchased (~$550M)

    • 18.3M shares sold (~$117M) MarketBeat

    • This reflects overall upward interest, but pockets of profit-taking and rotation remain.

  • Other Q1 fourth-quarter buyers included firms like Brighton Jones, Victory Capital, and Private Advisor Group, while sellers included RA Capital prominently MarketBeatMarketBeat.


✅ Summary

  • UBS (both global and Americas units) made the largest scale-ups recently.

  • RA Capital initiated the most substantial reduction, liquidating its entire stake.

  • Mid-cap managers like KLP, Steel Peak, Prime Capital, and IMC‑Chicago also significantly expanded their RXRX positions.

  • Some smaller managers, including QRG Capital, reduced or trimmed their positions.


  • ED Note:  We are long RXRX

Friday, June 20, 2025

Robots, Robotics and Automation - Investing in the "picks and shovels"!

 


If I had to pick only one "pick and shovel" stock to invest in for the robotics (especially humanoid/industrial robot) boom—including plays like Tesla's Optimus—my choice is:


๐Ÿ† Rockwell Automation (NYSE: ROK)

๐Ÿ”ง Why Rockwell?

1. Pure-play industrial automation leader

  • Rockwell is deeply embedded in manufacturing, robotics integration, motion control, industrial sensors, and factory digitization.

  • Its FactoryTalk, ControlLogix, and Allen-Bradley product lines are widely used in industrial robotics—from automotive to food production.

2. Strategic partnerships with AI & cloud giants

  • Rockwell has deep integrations with Microsoft Azure, NVIDIA Omniverse, and PTC (IoT CAD software)—vital for robotic design, simulation, and operation.

3. Robotics-native clients

  • Customers include Tesla, Boeing, Procter & Gamble, and automation integrators. Optimus-style humanoid robots will require factory retooling—which Rockwell enables.

4. Strong financials

  • High margins (~25% EBITDA), consistent free cash flow, and a track record of innovation make it a rare combo of growth, quality, and income (1.6% dividend yield).

  • Rockwell is profitable, with global exposure and minimal debt pressure.

5. Long-term megatrends tailwind

  • Growth in "lights-out factories", robotic arms, machine vision, and motion automation all converge at Rockwell.

  • As companies transition from legacy automation to AI-enhanced robotic systems, Rockwell provides the tools, software, and integration layers.


✳️ Quick Stats (as of June 2025)

MetricValue
Market Cap~$32B
Dividend Yield~1.6%
P/E Ratio~28x
YoY Revenue Growth~6%
Robotics/Automation %>75% of revenue

๐Ÿ†š Why Not Others?

  • Ametek (AME) and RBC Bearings (RBC) are great precision motion plays—but more passive in robotic development.

  • NVIDIA is critical—but not a pure "pick and shovel" for robotics. It's broader AI and data center focused.

  • ABB, Keyence, and Siemens are also excellent—but either not U.S.-based or less pure-play.

  • Ouster (LiDAR) and Regal Rexnord (motors) are too narrow.


✅ Final Word

If you're investing in the tools behind the robotics revolution, especially as it scales into humanoids like Tesla's Optimus, Rockwell Automation stands out as the most strategic, financially sound, and robotics-focused pick-and-shovel stock available today.

Rockwell Automation Inc (ROK)
$321.80
+$107.21(+49.96%)Past 5 years

Here’s a detailed breakdown of Rockwell Automation (ROK), covering earnings projections and technical valuation insights:


๐Ÿ“ˆ 5-Year Earnings & Growth Forecast

PeriodProjected EPS Growth
Next 1 yr (to 2026)From ~$7.97 today to ~$9.73 → ~22% increase
2026 Estimate~$11.31 EPS
2027 Estimate~$13.17 EPS
CAGR (2025–2028)EPS +14.2% / revenue +6.2% annually
Long-term (to 2029)Analysts forecast ~$14.11 EPS by FY 2029 
Analyst Consensus: About 6‑11 analysts expect EPS between $9–10 for FY 2025 and rising steadily through 2027 .

๐Ÿ“Š Technical Analysis Snapshot

  • Moving Averages:

    • On the daily scale, price is above 200‑day MA (~$277), 50‑day (~$283), and 20‑day (~$317), indicating a bullish trend 

    • Short‑term MAs also bullish in most models .

  • Trend & Patterns:
    ChartMill gives a technical rating of 9/10, with both short- and long-term trends positive.
    A bull-flag pattern suggests a potential buy-on-breakout opportunity, with support around $318 and resistance near $325 

  • Indicators:

    • RSI is neutral-to-strong — around mid‑range.

    • MACD recent crossover turns positive, supporting bullish momentum in daily models .

    • Investor’s Business Daily (IBD) upgraded RS rating to 83 (top quintile) but noted a slight pullback from a failed base entry near $308, implying a new base formation may be prudent 


๐Ÿ” Long-Term Outlook & Valuation

  • Earnings Growth Driver: Rockwell provides industrial automation solutions, benefiting from onshoring and the broader digitization of manufacturing. Barron’s highlights projected ~17% annual EPS growth through 2027 

  • Tariff Tailwinds: Rockwell is cited as a key beneficiary of increased onshoring due to higher tariffs, making it a go-to industrial play in that trend .

  • Valuation Summary:

    • Trading near $322, with a one-year average price target of $326 (range $290–371) by Wall Street 

    • Reasonable P/E based on ~$9–10 EPS, giving ~30×–35× forward P/E—typical for a high-quality industrial automation company.


๐Ÿงญ Bottom Line

  • Earnings Trajectory: Robust growth expected — ~14–22% EPS CAGR over next 2–5 years.

  • Technical Setup: Bullish trend with backup from multiple indicators and chart patterns, though a careful entry after base confirmation may yield better risk/reward.

  • Macro-Catalysts: Onshoring, increased automation, and high-margin solutions support earnings and valuation.


Your Next Moves

  • For long-term exposure: Buying on dips above $318–$320 with a multi-year view of automation trends—and holding for EPS growth and rising automation adoption.

  • For tactical entries: Monitor a breakout above $325 on expanding volume—this would confirm bullish momentum and enable tighter, disciplined entries.

Here’s a refined model for a 12-month target price on Rockwell Automation (ROK):


๐Ÿ“Š 1. Base Scenario: Conservative PE

  • EPS Estimate for FY2026: ~$11.49 

  • Modest Forward P/E: 26× (near its historical fair ratio of ~29×)

  • Target Price: 11.49 × 26 ≈ $299

This projection is slightly below current levels, suggesting limited upside if the market is cautious.


๐Ÿ”ผ 2. Growth Scenario: Elevated PE

  • Same EPS: $11.49

  • Premium P/E: 30× (reflecting continued automation enthusiasm)

  • Target Price: 11.49 × 30 ≈ $345

This targets the upper range of analyst forecasts and assumes multiple expansion 


๐Ÿ›  3. Bull Case: Full Growth Re-Rating

  • EPS for FY2027: ~$13.19 

  • High-End P/E: 28× (middle ground between growth and valuation)

  • Target Price: 13.19 × 28 ≈ $370

This aligns with the top analyst estimate ($371) .


๐Ÿ“Œ Summary Table

ScenarioAssumed EPSP/E MultipleTarget Price
Base$11.4926×$299
Growth$11.4930×$345
Bull (2027)$13.1928×$370

๐Ÿ” Interpretation

Monday, March 24, 2025

USA Presidential elections have a real impact on stock markets. So, How can one position oneself in the first year?


If we use the election cycle as a guide, especially for U.S. presidential elections, there are some historical patterns investors often pay attention to:

  • Post-election years (like 2025) often bring policy shifts (stimulus, deregulation, defense spending, etc.) that affect certain sectors.

  • The first year of a presidency often includes new government programs, spending packages, and regulatory changes—this can mean big moves for companies exposed to government contracts or regulation.

So, if we go by history and themes that often play well in post-election years, here are a few sectors and example companies to watch for potential gains in 2025:


⚙️ 1. Defense & Aerospace

New administrations (regardless of party) often increase defense budgets or reallocate them. Global tensions also drive this.

  • Lockheed Martin (LMT)

  • Northrop Grumman (NOC)

  • Palantir Technologies (PLTR) – also benefits from defense + AI + government contracting.


๐Ÿ—️ 2. Infrastructure & Clean Energy

If a new or returning president pushes for infrastructure investment or green energy, watch for this boost.

  • Caterpillar (CAT) – infrastructure and construction machinery.

  • NextEra Energy (NEE) – strong in renewables.

  • Quanta Services (PWR) – electric grid, renewables infrastructure.

  • Tesla (TSLA) – if EV incentives ramp up again.


๐Ÿฅ 3. Healthcare & Biotech

Healthcare reform efforts and FDA funding shifts can heavily impact drug and medtech companies.

  • UnitedHealth Group (UNH) – strong during regulatory changes.

  • Eli Lilly (LLY) and Novo Nordisk (NVO) – if focus returns to obesity and diabetes solutions.

  • 10X Genomics (TXG), Twist Bioscience (TWST) – if genomics and biotech innovation get funding support.


๐Ÿง  4. Artificial Intelligence & Cybersecurity

Governments are investing in AI infrastructure and cybersecurity regardless of party lines.

  • NVIDIA (NVDA) – chips powering AI.

  • SentinelOne (S) or CrowdStrike (CRWD) – cyber defense.

  • C3.ai (AI) – close to government contracts + enterprise AI.


๐Ÿ’ป 5. Semiconductors & Reshoring

Both parties push for U.S. manufacturing and chip independence.

  • Intel (INTC) – heavy government backing for fabs.

  • AMD (AMD) and Broadcom (AVGO) – tied to infrastructure and AI buildout.


๐Ÿฆ 6. Financials

Rising interest rates and policy changes may impact banks and fintechs.

  • JPMorgan Chase (JPM) – strong during rising rate environments.

  • Charles Schwab (SCHW) – benefits from investor optimism and capital flows.


๐Ÿงฑ Bonus: "Made in America" Manufacturing Push

If the next administration continues or accelerates reshoring, you might look at:

  • Eaton (ETN) – power management.

  • Generac (GNRC) – tied to grid resilience and climate-driven demand.

  • Enphase Energy (ENPH) – if solar incentives return.


if we go purely by the Presidential Election Cycle Theory, without regard to who's elected or what policies are implemented, the stock picks would shift slightly. Here's how it breaks down:


๐Ÿ”„ Presidential Election Cycle Theory (based on 100 years of market data)

  • Year 1 (Post-election, like 2025):

    • Historically the weakest year for markets, as new policies are introduced and uncertainty is high.

    • However, select sectors still do well, especially those tied to defensive industries and government spending.


๐Ÿ“ˆ Sectors That Have Historically Done Well in Year 1 (like 2025)

  1. Defense & Aerospace

    • Government spending is rarely cut here, and often increases in a new administration.

    • ๐Ÿ“Œ Picks: Lockheed Martin (LMT), Raytheon (RTX), Northrop Grumman (NOC)

  2. Consumer Staples

    • Investors tend to get more defensive in Year 1, favoring essentials over risk.

    • ๐Ÿ“Œ Picks: Procter & Gamble (PG), Coca-Cola (KO), PepsiCo (PEP)

  3. Utilities

    • Steady cash flow, dividends, and regulation-protected businesses tend to outperform early in a presidential cycle.

    • ๐Ÿ“Œ Picks: NextEra Energy (NEE), Duke Energy (DUK)

  4. Healthcare

    • Historically does well early in the cycle due to defensive nature and consistent demand.

    • ๐Ÿ“Œ Picks: UnitedHealth Group (UNH), AbbVie (ABBV), Pfizer (PFE)


๐Ÿง  Less Emphasis on Risk-On Plays (at least early in Year 1)

High-growth sectors like tech, small caps, and speculative AI or biotech often lag in Year 1 of a presidency, unless there's a clear macro tailwind or stimulus policy. So under the pure cycle method, you might de-emphasize:

  • NVIDIA (NVDA)

  • Tesla (TSLA)

  • ARK-style innovation stocks


⏳ When Would Those Growth Stocks Shine Again?

Historically, Year 3 of a presidential cycle (i.e., 2027) is the best year for markets — that’s when risk-on names historically shine again, thanks to:

  • Stimulus before re-election campaigns

  • Low volatility

  • Business-friendly environments


Summary of 2025 Sector Tilt (Based on 100-Year Cycle Alone):

SectorReasonExample Stocks
DefenseNew spending priorities, safe in all climatesLMT, RTX, NOC
Consumer StaplesDefensive, reliable earningsPG, KO, PEP
UtilitiesHigh dividends, stable cash flowNEE, DUK
HealthcareConsistent demand, defensiveUNH, ABBV, PFE

Let’s blend the Presidential Election Cycle theory with the reality of today’s innovation drivers: AI, quantum computing, and healthcare.

๐Ÿง  The Strategy:

  • Use the Year 1 (2025) cycle pattern as the foundation (defensives and government-aligned picks).

  • Overlay that with 2025’s megatrends — AI, quantum computing, and healthcare innovation.

  • Choose balanced exposure: stability + growth + innovation, weighted accordingly.


๐Ÿ“Š Hypothetical 2025 Portfolio (Balanced & Thematic)

CategoryWeightStock PicksRationale
Defense & Government AI20%Lockheed Martin (LMT)
Palantir Technologies (PLTR)
Defense always gets funding in Year 1. PLTR has deep AI + Gov roots.
Consumer Staples10%Procter & Gamble (PG)
PepsiCo (PEP)
Safe haven during economic/policy transitions.
Utilities (Green Tilt)10%NextEra Energy (NEE)
Brookfield Renewable (BEP)
Stable dividends + clean energy upside.
Healthcare (Core)20%UnitedHealth (UNH)
Eli Lilly (LLY)
Defensive and growth. LLY also has GLP-1 tailwind.
Healthcare (Innovative)10%10X Genomics (TXG)
Twist Bioscience (TWST)
Genomics and synthetic biology play to long-term innovation.
AI Infrastructure (Stable)10%Microsoft (MSFT)
NVIDIA (NVDA)
MSFT for enterprise AI/cloud, NVDA for infrastructure. Both resilient even in choppy years.
AI + Quantum Pure Plays10%C3.ai (AI)
IonQ (IONQ)
Riskier growth, but aligned with megatrend of the decade.
Cash or Short-term Bonds10%BIL (Treasury ETF) or cash equivalentPreserves dry powder for volatility and rotation into growth later in the cycle.

๐Ÿงฉ Optional Tilt Ideas (if you want more flavor)

  • Swap PEP for Costco (COST) if you want retail exposure.

  • Add AbbVie (ABBV) if you want more dividend-friendly healthcare.

  • Add Honeywell (HON) for a hybrid industrial + quantum exposure.


๐ŸŽฏ Portfolio Themes Summary:

  • Cycle-aware: Defensive posture in Year 1.

  • Future-aware: Allocated to the sectors leading the next wave (AI, quantum, genomics).

  • Balanced: Risk is spread across stability (utilities/staples), income (healthcare/defense), and innovation (AI/quantum/genomics).

Now let’s bolt on a “high-risk / high-reward” satellite portfolio that complements your core 2025 cycle-aware + future-tech portfolio.

๐ŸŽฏ Purpose of Satellite Portfolio:

  • Capture explosive upside potential from early-stage or volatile innovators.

  • Lean into speculative AI, quantum, biotech, and frontier tech bets.

  • Accept that some may not perform in Year 1 of the cycle, but could 10x+ in later years.


๐Ÿš€ Speculative Satellite Portfolio (10-15% of Total Portfolio)

Stock / TickerSectorRationale
C3.ai (AI)AI EnterpriseEarly mover in AI platforms, volatile but visionary — Gov + private AI.
IonQ (IONQ)Quantum TechOne of the few pure-play quantum stocks, backed by AWS/Microsoft.
Recursion Pharma (RXRX)AI + Drug DiscoveryBacked by NVIDIA + using AI to map biology and accelerate pharma pipelines.
Annovis Bio (ANVS)Alzheimer’s BiotechSmall-cap biotech chasing a huge unmet need — big swing on clinical data.
Symbotic (SYM)Robotics/AIAI-powered warehouse robotics, backed by Walmart and SoftBank.
ARK Genomic Revolution ETF (ARKG)Biotech/GenomicsAccess to early-stage genomics, CRISPR, and longevity companies.
BrainChip Holdings (BRCHF)Neuromorphic AISuper speculative — building chips modeled after the human brain.
Zapata AI (ZPTA)Quantum-AIRecent SPAC; combining generative AI with quantum optimization. Very high-risk.

⚠️ Notes:

  • These stocks/companies are more volatile and often not profitable.

  • Some may be thinly traded or prone to sharp corrections on news.

  • Meant to be a smaller piece (10-15%) of your total exposure — think moonshots.


๐Ÿ”ง Allocation Suggestion (If you allocate 15%)

TickerAllocation %
AI2%
IONQ2%
RXRX2%
ANVS2%
SYM2%
ARKG2%
BRCHF1.5%
ZPTA1.5%

ED Note:

This is not investment advice, nor am I an investment advisor. The foregoing is a report created wholly using "Deep Research" Ai using public information from 100 years of Presidential elections. It should be noted, however, that many of Wall Streets elite often refer to the "Election Cycle" metric.

Risk LevelCatalyst to WatchEntry Price Target ($)Stop-Loss Level ($)
HighNew enterprise AI contracts, earnings growth27.020.0
HighGovernment contracts, quantum computing adoption10.07.0
HighPartnerships with pharma, AI platform development7.05.0