News covers potential future of TikTok in US, Apple's challenges in China, and positive bank earnings
From Nasdaq: 2025-01-22 13:55:00
Motley Fool analysts discuss the potential future of standalone TikTok U.S., Apple’s challenges in China, and promising bank earnings. Two stocks to watch are Invitation Homes and Duolingo. Co-Founder David Gardner and host Ricky Mulvey talk about the stock market in 2025. A potentially lucrative investment opportunity with “Double Down” stock recommendations is highlighted. The podcast also delves into the TikTok ban deadline and its implications for ByteDance and other enablers like Apple and Google. The sustainability of TikTok’s network effect is questioned as potential restrictions loom. TikTok, with 170 million users, faces uncertainty in the US. American creators may switch to Reels or Red Note. Speculation surrounds potential sale, with Elon Musk or Google as possible buyers. Former Dodgers owner and Steve Mnuchin also interested. TikTok’s US business could be worth $50-$200 billion, depending on what’s included.
Apple loses smartphone market share in China to Huawei and Vivo. iPhone sales dropped 5% in holiday quarter. Chinese smartphone makers now dominate with 56% of global shipments. Apple Intelligence fails to boost hardware sales or service business. Apple’s stock, trading at 30 times forward earnings, faces scrutiny as valuation remains high despite recent decline. In 2025, Apple faces challenges in China with their AI offering not available on Chinese smartphones, holding only 15% of the market with a 17% drop in shipments from 2023 to 2024.
Financials, especially banks, had a strong start to 2025 with earnings reports from JPMorgan, Morgan Stanley, Wells Fargo, Citi, and Bank of America showing revenue growth and shareholder yield of 3.7% in 2024.
Bank results from JPMorgan, Goldman Sachs, and Wells Fargo in Q4 2024 showed revenue growth, higher investment banking fees, and increased trading revenue, setting a positive tone for the financial sector in 2025.
Jamie Dimon of JPMorgan highlights the importance of managing risks in volatile markets and calls for a review of lending regulations to ensure a safe US economy, emphasizing the impact on banks and the overall economy.
The optimism in the banking sector for 2025 is driven by strong earnings results, potential deregulation under a new Trump administration, and a promising deal pipeline, especially in IPO activity, creating a positive outlook for the sector.
Morgan Stanley’s CEO Ted Pick notes a strong deal pipeline for 2025, suggesting a potential increase in mergers and deal making activity, indicating a broader scope of business opportunities for banks in the coming year.
The FDA authorizes ZYN’s nicotine pouches for sale in the US, providing an alternative for adults looking to quit cigarettes, concluding a regulatory saga and offering a new option for tobacco users. Motley Fool discusses FDA approval of ZYN as a safer alternative to smoking, beneficial for adults seeking alternatives. ZYN pouches pose lower cancer risk than cigarettes and other tobacco products. Philip Morris owns US distribution rights to ZYN, offering a 4.5% dividend yield. Market forecast for 2025 suggests positive growth, with optimism for long-term investments. Market predictions provide false certainty for short-term gains, but long-term investment is key. David Gardner believes that individual investors have an advantage over managed funds in terms of control over their investments. He recommends a long-term approach to investing, predicting a 10% annual return over the next 20 years, with occasional downturns. He also warns of potential bear markets lasting 18 months, emphasizing the value of holding onto investments.
Looking back at the last 20 years, Gardner points out major market downturns like the Great Recession of 2008-2009 and the brutal year of 2022. He predicts two more severe bear markets over the next two decades, lasting around 18 months each. Despite potential challenges, he remains optimistic about long-term investing and the potential for substantial returns.
Gardner encourages investors to adopt a rational and optimistic view of the stock market, with a long-term perspective. He predicts that the market will go up in two out of three years over the next two decades, with occasional severe downturns lasting around 18 months. He advises holding onto investments and staying committed to long-term growth.
In discussing the future of the stock market, Gardner emphasizes the importance of being a long-term optimist despite potential challenges. He acknowledges concerns such as national debt and technological advancements like drones, but remains confident in the potential for investors to see substantial returns over the next 20 years. Geopolitical tensions are high with conflict between Russia and Ukraine. Uncertainty looms with China and Taiwan. Despite past returns, long-term optimism is justified. The stock market reflects American business growth and innovation. AI and robotics advancements will benefit society. Embrace AI for its potential to enhance and automate various aspects of life. Embrace caution but recognize the transformative power of technology. The Internet and e-commerce were once doubted, now they drive global economies. AI will follow suit, revolutionizing industries and daily life. In a recent Motley Fool Money podcast episode, Ricky and David discussed space travel. Matt Argersinger highlighted Invitation Homes, a REIT that owns single-family rentals. He believes the stock is undervalued compared to home prices. Bill Mann discussed Duolingo’s growth due to the potential TikTok shutdown, with a 216% spike in US users learning Chinese. However, some users struggle to retain the language. Dylan Lewis raised the issue of Duolingo not offering Tagalog, a missed opportunity for Filipino learners. Bill Mann noted the lack of demand for Tagalog but encouraged Dylan to advocate for its inclusion. Rick Engdahl and the team discuss stock recommendations, with Matt Argersinger choosing Invitation Homes. Listeners can get two stock ideas monthly through Motley Fool Stock Advisor. Bank of America, Wells Fargo, and JPMorgan Chase are advertising partners. Various members of the team have positions in different stocks mentioned. The Motley Fool also recommends Alphabet, Apple, and Tesla.
Read more at Nasdaq: TikTok Chat, Big Bank Review, and Some Stocks Worth Watching