Investment Q&A

Q: Hi Peter
I asked about the defence stocks . Would you consider these two appropriate at this time . Am I better off with RTX or
AVAV at this time .

Q: It seems the world’s electrical grid is going to look a lot different in the future. All the talk is around digitization and decentralization, whereby DER’s (distributed energy resources) will add supply back into the grid (solar panels, generators, even EV’s) and the local utility will also be able to reduce demand remotely by adjusting your a/c, hot water tank etc. all enabled by smart meters/networks driven by the technology of the internet of things and AI. My question is do you have an idea who the capital light kind of tech companies are that are going to provide the services to all the Utilities out there to make this happen? It is already happening in few places on a small scale, but the addressable market going forward is mind boggling. I guess I would much sooner invest in the tech than the guys digging lithium out of the ground! Any info appreciated, thanks.

Q: I am debating between Costco and Siemens for a roughly 2% position. I have slightly more Consumer Discretionary versus Consumer Staples exposure, but I feel like I have decent expsoure to each. Costco interests me as potential long-term holding with a track record of consistent success; Siemens interests me for its broad exposure to all things technological, including the fields of automation, medicine, power distribution and electrification. I could ultimately buy each, but I only have enough free capital to purchase one of the two at this moment. Using the criterion of a five-year time horizon or longer, which would you deem to be a more prudent investment?

Q: I have been looking closer at the industrial sector over the last few months, as I believe that societal increases in technology usage and adoption of electric vehicles in transporation are placing increased demands on the generation and distribution of electrical power. I am looking at both Siemens and ABB as investments in this space which can also serve as long-term anchor holdings. Siemens is a very broad-based company which has a portion of its business dedicated to infrastructure and energy generation, which it describes as its "Smart Infrastructure" unit, while having very robust units in manufacturing, transportation and healthcare. ABB Ltd. appears to be more focused in the infrastructure and utility sectors.

The case for Siemens would revolve around its success in multiple sectors of the economy and its ability to generate revenue from a variety of sources, while the case for ABB would be that it is well-positioned to fulfill the demands of societies which are demanding ever more performance from the energy generation and distribution systems from the places where they live. Both seem to have corrected substantially since early 2022 (SIEGY down 24%, ABB down 18%), which could indicate buying opportunities in the absence of significant news which would account for these depreciations in price.

What are your thoughts on these companies, as well as the idea of investing capital in companies which could address upcoming infrastructure demands? As always, I look forward to reading your thoughts. Thanks so much, and have a great weekend?