AI Earnings Look Incredible - That Might Be the Problem

Brian Feroldi (0:00)

These companies have gone up tremendously. And if you track the fundamentals of these companies, like the revenue and the profits and the margins, everything is trending in the right direction. And these companies do not look all that expensive on a fundamental basis, because their profits have exploded. But there are some bubbles that can happen when profits are artificially inflated.

LGDU Set (0:22)

What's up, everybody? It's LGDU Set here, and welcome to Milk Road Stocks, the daily market show that still fomo's into bright shiny objects but puts it on a credit card so it looks like an early Christmas present. Today is September 14th, 2026, recording on September 9th. What if stocks were broken into five categories that helped you decide whether it's time to get in or out? We do a lot of deep dives and market talk on this channel, but rarely do we talk about our actual investment frameworks and show a consistent way to evaluate these businesses. Our guest today does exactly this. With 600,000 subs on YouTube, he is a self-described financial educator with over 20 years' experience in the market. He's got a pretty different take on today's AI build out and tech sector than we usually talk about, and he'll give us his current thesis and cash position live on the episode. Brian Feroldi is with us today. If you want to see what our analysts are actually buying right now and how they're managing their portfolios as the market heats up again, you can check out their buy and sells in Milk Road PRO, which is just a dollar to test out at the link below. Brian, welcome to Milk Road, man.

You are a financial educator, and I think that that's something at this point in the market where we all need to take a step back and think about our frameworks for investing our portfolios. I feel like that's why I wanted to have you on the show, is to help us walk you through that.

But first, I think we need a better credibility, man. Who are you? Why should we listen to you?

Brian Feroldi (1:37)

Yeah, fair enough.

I'm Brian Feroldi. I bought my first stock in 2004, and I specifically say bought my first stock because I was not investing back then. I was trading, I was on the Yahoo discussion boards, and I had no idea how the markets worked. I got my teeth kicked in for about 18 months, but still was super interested in all things markets, and I've just been voraciously consuming all content I can get related to money and investing basically since then. I was a writer for The Motley Fool for about eight years, and I've been doing my own thing for the last four, but I've been investing for more than 20 years.

LGDU Set (2:13)

Wait, what was the stock you bought? What was the first stock?

Brian Feroldi (2:15)

Oh, so many, so we could go to lots of stories about this, but just to show you how bad of an investor was. Do you remember US Air, the company US Air?

LGDU Set (2:24)

Of course, yeah.

Brian Feroldi (2:25)

So I bought that stock after they declared bankruptcy, and I didn't know that they declared bankruptcy. So that should tell you how much analysis that I was doing at the start. I was like, this stock is under a dollar per share, and I recognized the name.

End of analysis.

LGDU Set (2:42)

Wow, that's like you're picking stocks for the newspaper at random in that case.

Brian Feroldi (2:46)

Yes.

LGDU Set (2:46)

But that's like pre-social media like we have it now, right? You couldn't just type it into X or something like that, or YouTube, and have a whole list of stuff, right? So in your defense.

Brian Feroldi (2:56)

If you told me, go research this company, I wouldn't even know what the first step was. All I knew was ticker price per share. That's it. So I started out with absolutely zero knowledge of how to do this. And by the way, I say that as someone that graduated with a business degree.

A business degree. So I was taught nothing about this. Everything I've learned, I've learned on my own.

LGDU Set (3:16)

Brian, is this something, I feel you talked to a lot of people that are investors, retail investors and all kinds. Is this a mistake that people still make? Do people just they're like, I heard of this company, I'm going to buy some.

That's it.

Brian Feroldi (3:26)

Oh, 100 percent. Absolutely. Again, it's like we're taught nothing about the relationship between the stock, the stock price and the company. The only thing people see when you pull up the app on your phone is ticker symbol price and the price moves up and down rapidly. It seems like a gigantic gambling machine.