TMTB EOD Wrap: Sandisk (SNDK) vs Micron (MU)

Good afternoon. QQQs finished the day +1.2% after a choppy day that saw the market rally from down 1% in the pre to +2% after Trump’s negotiation tweets, then chop around most of the day as investors digested statements of denial coming out of the Iran side. We ended up ~110bps off the intra-day. No need for coffee with this start to the week:

Overall, investors a bit more optimistic about Trump’s willingness and desire to step away from the war, but definitely no euphoria out there as still plenty of questions about how and what a deal would exactly look like and how willing Iranian side is to negotiate right now given their leverage with Hormuz. The base case here seems that the peak escalatory rhetoric likely behind us after the Qatar LNG strikes last week (rate of change getting better), but also that the process won’t be linear, will likely take a bit of time, and the fallout from high energy prices won’t be erased. Oil was -9% with Brent finishing close to $100. All of that being said, nothing resolved yet, but investors feeling a bit of relief, but also not enough to chase as there are still many unresolved questions.

In Tech, fairly broad breadth with all sectors up. AI complex held up fairly well with led by optical/neoclouds while memory lagged (more on this below when we get into AI semis). From a factor perspective, non profitable tech and high short interest led the way although TMT Momentum not far behind.

Let’s get to it…

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INTERNET

• AMZN +2.3% led large cap higher as multiple bullish notes this morning pointing to AWS acceleration: TD Cowen said 30%+ in 2027, Barclays 34% (vs street at 25%) by Q3' of this year, and Jefferies also defending the stock. Wells was out detailing the impact of higher fuel prices saying about 330bps of drag to operating income (a 10% move in fuel prices = $1.3B annual cost impact). META +1.7% as GS said cost rationalization could drive mid teens to 20%+ upside to EBIT/EPS and GOOGL +35bps — not much out there other than RBC saying OAI ad rollout creating incremental competitive pressure although early checks not great. Think the latter here more just underperformance as more over-owned/favored than the other two. Saw this trade for GOOGL: 20,000 of the 340 calls in June bought for $7.15+ (h/t Bulltard) - that’s $15M of premium for a 3 month trade.

• ROKU +5% the big winner: checks here continue to sound strong intra q after platform revs accelerated this quarter. Bull case here centers around continued platform accel/conservative guide and narrative is 3-pronged: 1) the secular shift of TV ad budgets from linear to CTV, 2) Roku’s role as an interoperable platform that can work across major demand sources (rather than being constrained to a single walled garden), and 3) rising monetization efficiency from better measurement, performance tooling, and expanded inventory/product surfaces (e.g., home screen innovation).