• Why a bigger position can make you less money.

• How position size determines whether you can stay with a winning investment.

• Why normal volatility can expose a sizing problem—not an investment problem.

• How I size a position for the risk I can actually execute.

Have you ever owned a stock that eventually did exactly what you thought it would do—

but somehow you didn’t make the money?

You found the right stock. Your thesis was right. The move eventually happened.

But you weren’t there for it.

Maybe you got shaken out on a normal pullback. Maybe the volatility became uncomfortable and you sold.

Then you watched the stock turn around and go exactly where you thought it would.

And you’re left thinking:

I knew it. Why didn’t I make money?

Here’s something that can be easy to miss:

Sometimes the reason you didn’t make enough money on a winning investment is that you invested too much money in it.

The problem may not have been your research.

It may not have been the stock.

It may not even have been your Stop.

Your position may simply have been too large for you to execute the investment correctly.

That’s why I think about position size differently.

Before I put on a position, I want to know how much money I’m actually willing to lose if I’m wrong.

Then I look at where the investment needs room to trade.

If the chart needs enough room for me to make an end-of-week decision, I can’t size the position so large that one or two days of normal volatility force me to abandon that process.

The position has to fit the risk. Not the other way around. That can mean owning less.

And this is where investors sometimes get tripped up.

Owning less can feel like you’re being less aggressive.

But if a smaller position allows you to…

• stay with a good investment through normal volatility,

• follow your Stop discipline, and

• let the thesis actually play out,

… smaller can ultimately make you more money.

The goal isn’t to own the largest position you can.

The goal is to own the largest position you can execute correctly.

That’s a very different standard.

So before your next investment, don’t just ask:

How much do I want to own?

Ask:

How much can I own and still follow my process when this position moves against me?

Three simple steps:

1. Know the dollar risk first.

2. Give the investment the room it actually needs.

3. Then size the position accordingly.

That’s how you stay on the bus long enough to capture the move when you’re right.

Be the smart money,

Bret Rosenthal

Founder & CIO, ARMR Investing

P.S. If you want to see exactly how I apply this, I walk through a live $QCOM case study showing how I define the technically valid Stop first, then size the position around the dollar risk I’m willing to take.

• What to do when a stock you want gaps higher.

• Why I don’t chase the first move.

• The ARMR Gap Up Entry Protocol.

• How I define the entry—and know where I’m wrong.

There’s a mistake I see investors make after a stock reports great earnings.

They find a company they want to own.

Earnings come out strong.

The stock gaps higher.

And suddenly the decision becomes:

Do I buy it now before it gets away from me?

That’s usually the wrong question.

When a stock makes a major gap higher, I don’t chase the first move.

I wait for the stock to give me an entry.

There’s a specific process I use for this. I call it the ARMR Gap Up Entry Protocol.

$SNOW recently gave us a textbook example.

The stock gapped sharply higher after earnings. Instead of buying into that initial surge, I measured the move using a Fibonacci retracement and waited.

Eventually, $SNOW pulled back to the 50% retracement level.

That level lined up with technical support.

Then the armrAlgo gave me a new buy trigger.

That was the entry. Not the gap.

And just as important, I knew the clear Stop to protect capital before I put the trade on.

The low of day bought [LoDB] is the Stop. If the entry is right the Stop can be tight.

That gives me three things before I commit capital:

1. A defined entry.

2. Confirmation.

3. A defined exit if capital protection is required.

That’s very different from seeing a stock explode higher and buying because you’re afraid of missing it as you FOMO your way to losses

There are several stocks on my whiteboard right now that I’d like to own.

That doesn’t mean I’m going to buy them.

Wanting to own a stock and having an executable entry are two different decisions.

My job is to wait until those two things meet.

So the next time a stock you want gaps higher, don’t ask:

Did I miss it?

Ask:

What would have to happen from here for this to become a high-quality entry?

Then define it.

And wait for the market to come to you.

To see this kind of analysis in real time, join me live on our trading desk Wednesday, 9am ET for the ARMR Morning Meeting.

I’ll show you the setups I’m watching and how I’m applying the ARMR Investing Way to real portfolio decisions as the market develops.

Be the smart money,

Bret Rosenthal

Founder & CIO, ARMR Investing

p.s. The evidence changes every day. Join me for the Morning Meeting livestream and see how I’m reading it, adjusting risk, and deciding what earns capital in real time. [Join the Morning Meeting →]

Executive Summary and Strategic Metamorphosis

Robinhood Markets, Inc. (NASDAQ: HOOD) has successfully executed a profound structural transformation, evolving from a retail trading application heavily reliant on zero-fee equity transaction volume into a diversified, multi-product financial institution.

As of the second quarter of 2026, the company’s strategic pivot toward a “Financial SuperApp” model has demonstrably materialized. This is evidenced by record revenue generation, sustained profitability, and the rapid scaling of thirteen distinct business lines to over $100 million in annualized revenue. This transition represents a structural maturation, moving the firm away from the highly cyclical, volatility-dependent revenue streams of its early years toward highly predictable, recurring, and interest-bearing capital models.

The financial trajectory spanning from the end of 2025 through the first half of 2026 indicates a deep monetization of the user base.

Through aggressive product velocity including the expansion of the Robinhood Gold subscription tier, the scaling of retirement accounts, the introduction of a proprietary credit card business, and the explosive growth in event contracts—the platform has successfully deepened its share of wallet among the next generation of investors.

Concurrently, Robinhood has resolved massive historical regulatory overhangs via comprehensive settlements with the SEC and FINRA, while securing the SEC’s formal closure of its investigation into Robinhood Crypto. These resolutions have fundamentally de-risked the enterprise, allowing capital previously reserved for legal contingencies to be deployed toward global expansion and aggressive share repurchases.

This comprehensive report provides an exhaustive analysis of Robinhood’s operational performance, strategic initiatives, balance sheet engineering, regulatory environment, and financial metrics through Q2 2026.

Aggregate Financial Performance and Revenue Trajectory

The period spanning the full year of 2025 through the second quarter of 2026 represents a watershed era for Robinhood. The firm has consistently shattered historical records across top-line revenue, net income, and asset accumulation.

Top-Line Revenue Expansion

For the full year of 2025, Robinhood achieved total net revenues of $4.5 billion (a 52% YoY expansion), anchored by a record Q4 2025 that delivered $1.28 billion. Entering 2026, the firm maintained its growth trajectory:

• Q1 2026: $1.07 billion (up 15% YoY)

• Q2 2026: $1.31 billion (up 32% YoY)

The accelerating growth rate in Q2 underscores the success of newly launched product verticals compounding upon the legacy trading infrastructure.

Profitability and Earnings Quality

Full-year 2025 net income reached $1.9 billion, yielding a record diluted EPS of $2.05. Core operating profitability has remained exceptionally strong into 2026, generating substantial free cash flow.

(Note: Q2 2026 Net Income and EPS include a $129 million / $0.14 per share non-operating gain from the RVI deconsolidation.)

Deconstructing the Revenue Architecture

The composition of Robinhood’s revenue highlights a strategic departure from its early reliance on payment for order flow (PFOF). The current base is highly diversified across transaction-based execution, net interest margin, and SaaS-like subscription revenues.

Transaction-Based Revenues: The Rise of Event Contracts

• Equities and Options: Options trading continues to be a high-margin anchor, reaching $342 million in Q2 2026 (up 29%). Equities saw a massive resurgence, surging 95% YoY in Q2 2026 to $129 million.

• Event Contracts: The most profound development is the explosion of event contracts (the financialization of prediction markets). This segment skyrocketed to $147 million in Q1 and hit $156 million by Q2, scaling over 10x YoY.

• Cryptocurrency & Bitstamp: While retail crypto revenue declined to $100 million in Q2 2026, the integration of Bitstamp provides a structural floor, proving Robinhood is successfully pivoting to an institutional and global infrastructure model.

Net Interest Revenues and Balance Sheet Engineering

Net interest revenue acts as a natural hedge against low transaction volume. Robinhood aggressively engineered its balance sheet to counteract macroeconomic headwinds by expanding margin lending.

• Margin Book: Increased 127% YoY to an unprecedented $21.6 billion by the end of Q2 2026.

• Internal Liquidity: The firm updated its High-Yield Cash program to fund margin growth, migrating over $6 billion into customer free credit balances, dramatically expanding margin spread without expensive external wholesale funding.

Subscription and Other Revenues

Robinhood Gold has become a runaway success, driving “Other revenues” up 54% YoY in Q2 2026 to $143 million. Specialized services, like the newly introduced “Trump Accounts,” demonstrate the firm’s capability to capture highly inelastic spending.

(Note: Q1 2026 crypto revenue is inferred from total transaction revenue minus equities, options, and other.)

Key Performance Indicators: Asset Aggregation

The underlying health of a consumer fintech firm is dictated by its ability to acquire assets, monetize users, and retain capital.

1. Hyper-Scaling AUC: Total Platform Assets rocketed to $369 billion by the end of Q2 2026.

2. Net Deposits: The second quarter set an all-time record of $21.7 billion (a 28% annualized growth rate). TTM net deposits stand at a staggering $75.7 billion.

3. Sticky Assets: Retirement AUC hit $34.5 billion by Q2 (up 82% YoY). The Robinhood Credit Card further embeds the firm into the daily transactional lifecycle of the consumer.

4. ARPU Expansion: Gold subscribers reached a record 4.8 million by Q2 2026 (a 17% attach rate). Consequently, ARPU expanded aggressively to $187.

Scaling the user base by nearly one million funded customers in Q2 2026 alone—without diluting per-user monetization—is a testament to the cross-selling algorithms embedded within the SuperApp architecture.

Operational Leverage and Capital Management

Robinhood’s rapid top-line growth has been coupled with rigorous cost discipline, signaling a definitive end to the “growth at all costs” mentality.

• Self-Funding Growth: Management lowered full-year 2026 Adjusted OpEx guidance to $2.675B–$2.775B, reflecting massive internal efficiency gains redeployed to fund new businesses like Rothera and WonderFi.

• Balance Sheet Fortress: Ending Q2 2026 with $5.4 billion in cash liquidity, bolstered by a strategic June convertible notes offering.

• Share Repurchases: Operating under a new $1.5 billion mandate, Robinhood aggressively retired equity in Q2 2026, keeping the diluted share count roughly flat throughout the year.

Regulatory Rectification: Closing the Chapter on Hyper-Growth

2025 was characterized by sweeping regulatory settlements that effectively close the book on legacy systemic compliance failures from the 2014-2024 hyper-growth era.

While the $71 million in combined fines is notable, it is immaterial relative to Robinhood’s $5.4 billion cash position. The formal closure of the SEC’s investigation into Robinhood Crypto (RHC) fundamentally alters the firm’s risk profile, validating its conservative coin listing strategy and positioning it for global expansion.

Valuation Perspectives and Market Outlook

Analyst consensus currently rates HOOD as a solid “Buy,” with a 2026 consensus price target of $123.33. The path to achieving and sustaining this valuation relies on three primary catalysts:

1. Sustained Net Deposit Velocity: Maintaining the current 22%–28% annualized growth rate will likely push AUC past $450 billion by the end of 2026.

2. Monetization of the SuperApp Architecture: The maturation of 13 core business lines provides highly visible, recurring cash flows, which command premium market multiples.

3. Global and On-Chain Expansion: The integration of Bitstamp and proprietary blockchain infrastructure (Robinhood Chain) perfectly positions the firm to capture global digital asset adoption, unencumbered by SEC litigation risks.

Conclusion

Robinhood Markets, Inc. has transcended its origins as a retail equity trading app. By aggressively expanding its margin book, institutionalizing recurring revenue through Gold, capturing retirement assets, and pioneering prediction markets, Robinhood has solidified its architecture as a comprehensive Financial SuperApp.

Backed by a pristine balance sheet, rigorous cost discipline, and a de-risked regulatory framework, Robinhood possesses both the liquidity and strategic clarity to systematically displace legacy wealth management incumbents as the primary financial hub for the next generation of global investors.

This analysis was powered by the ARMR Method™. To get my real-time insights, full portfolio access, and join a community of serious investors, explore our premium services

ARMRinvesting.com

DISCLAIMER: All of ARMR Report, our trades, strategies, and news coverage are based on our opinions alone and are only for entertainment purposes. You should not take any of this information as guidance for buying or selling any type of investment or security. I am only sharing my biased opinion based off of speculation and personal experience. An individual trader’s/investor’s results may not be typical and may vary from person to person. It is important to keep in mind that there are risks associated with investing in the stock market and that one can lose all of their investment. Thus, trades/investments should not be based on the opinions of others but by your own research and due diligence.

• When the market disagrees with itself.

• The evidence that could change my position.

• Why “staying open” doesn’t mean reacting.

• One question to ask before your next portfolio move.

There’s a simple question I use when the market starts giving me conflicting signals:

What would actually make me change my mind?

Not what would make me nervous.

Not what would make me feel like I’m missing something.

What evidence would justify changing the way I’m positioned?

Last week was a good example.

There were reasons to stay cautious. Momentum had weakened. Leadership was mixed. The Risk Monitor was not giving me a green light.

At the same time, there were areas of real strength. The S&P was pressing higher. Some leaders kept leading.

The market was giving me enough conflicting information that I had to stay open to changing my posture.

But “staying open” does not mean reacting to every move.

I wanted to see something specific: stronger institutional buying and confirmed breakouts.

That was the evidence that could flip the switch.

This is an important distinction.

A disciplined investor is not someone who never changes his mind. A disciplined investor knows what has to happen before he changes it.

If you don’t define that in advance, every market move becomes an emotional decision.

• A rally makes you afraid you are missing out.

• A selloff makes you afraid you were wrong.

• A headline changes your conviction.

Pretty soon the market’s running your process instead of your process running your capital.

It takes practice to control your emotions and stick to your investment plan.

Here’s something you can do immediately…

Before your next portfolio decision, write down:

“What specific evidence would make me change this decision?”

• If you are waiting to buy, what would confirm the entry?

• If you are holding a position, what would invalidate the thesis?

• If you are cautious, what would justify adding risk?

If you can’t answer that before the market starts moving, you haven’t finished the decision.

The point is not to predict perfectly.

The point is to make sure new evidence—not emotion—is what changes your behavior.

That’s how I operate my own capital.

Define the evidence. Let the market show you whether it’s there. Then act accordingly.

Be the smart money,

Bret Rosenthal

Founder & CIO, ARMR Investing

p.s. Want to see how I apply this process in real time? Join me live for the ARMR Morning Meeting, where I walk through the Risk Monitor, current market conditions, and the decisions I’m making with real capital.

Mining isn’t manufacturing; it’s the commercialization of scarcity. In this guest post, ARMR Analyst Erez Shapira breaks down how Barrick Mining Corporation (NYSE: $B) is proving that while digging massive holes in the earth is notoriously expensive, holding the keys to the world's largest geological monopolies is a highly lucrative business.

Currently trading around $40.85 with a $67 billion market cap, Barrick is operating as a macro-integrator of sovereign capital, heavy logistics, and base metals. Yet, the market is punishing the stock with a severe “conglomerate discount.”

Here is a deep dive into why that discount is about to get violently arbitraged.

The Fundamental Reality: A Monster Q2 2026

Under CEO Mark Hill, Barrick is printing cash at a massive inflection point. The second quarter of 2026 wasn’t just a strong earnings beat; it was a masterclass in structural scale.

Here are the key takeaways from the quarter:

• Net Earnings: $1.22 billion (a massive 50% year-over-year surge).

• Production: 796,000 ounces of gold (up 11% sequentially from Q1).

• Cost Discipline: All-In Sustaining Costs (AISC) held at $1,866/oz against multi-year highs in spot gold.

• Shareholder Yield: Management backed up the truck, executing $1.2 billion in share buybacks. Add the dividend, and $1.5 billion was returned to shareholders in a single quarter (a 242% YoY increase).

Despite these massive cash flows, Barrick trades at a hyper-compressed 11.07x forward P/E. Why? Because Wall Street hates blending Tier-1 North American safety with emerging market geopolitical risk.

The Catalyst: Checkmate in Nevada

The structural value shift happened on August 10, 2026, when Barrick executed a landmark settlement with rival Newmont ($NEM) regarding the Nevada Gold Mines (NGM) joint venture.

The math on this settlement is absolute:

1. Newmont is paying Barrick $1.95 billion in cash (roughly 2.8% of Barrick’s entire market cap), to be delivered within a 30-day window.

2. The massive Fourmile (Barrick) and Mike/Fiberline (Newmont) deposits will consolidate under NGM, creating an unassailable 100-million-ounce gold complex.

3. The Kicker: Newmont formally consented to Barrick’s planned spinoff of its North American assets.

Barrick effectively extracted nearly $2 billion from its biggest rival while securing the green light to restructure its corporate DNA.

The Strategic Roadmap: “North American Barrick”

Chairman John Thornton and CEO Mark Hill are aggressively advancing an IPO of a new entity slated for late 2026.

This spinoff isolates the crown jewels—NGM, Pueblo Viejo, and Fourmile—cleanly separating them from the African and Middle Eastern portfolio. This forces the market to price these assets competitively against pure-play peers like Agnico Eagle ($AEM), which currently enjoys a ~15.7x P/E simply for existing in safe zip codes.

The Incumbent Moat: You cannot 3D-print a district-scale gold mine in Nevada. Between 10-15 year permitting timelines, environmental approvals, and heavy capital requirements, regulatory exhaustion creates a functional monopoly for incumbents.

Meanwhile, Barrick is subtly executing a “Copper Pivot” with its remaining international assets to feed the global electrification deficit—because saving the planet requires a lot of copper wire.

Catalyst Watch & The Risk Profile

No trade is without friction. As we look ahead to the next 12 months, the bull and bear arguments hinge entirely on the execution of the spinoff.

🟢 The Bull Case (Upside Drivers):

• Sum-of-the-Parts Re-rating: The S-1 filing and North American IPO instantly erase the conglomerate discount.

• Operating Leverage: Guided Q3 and Q4 production increases are perfectly timed to meet record gold spot prices.

• Cannibalization: Aggressive utilization of the remaining $3 billion buyback authorization permanently lifts EPS.

🔴 The Bear Case (Downside Risks):

• The Shareholder Mutiny: Top-10 holders (including Van Eck, Mackenzie, and Franklin) are fiercely protesting the IPO, fearing dilution of their exposure to Barrick’s best assets. If they block the spinoff, the primary arbitrage thesis dies.

• The “International Orphan”: Post-spinoff, “RemainCo” becomes a high-risk entity deeply exposed to sovereign expropriation. It is going to need a very strong management team to navigate the geopolitical landscape.

The Bottom Line

At $40 per share, Barrick is generating roughly $5 billion in annualized net earnings while trading at an 11x multiple. They just fortified the balance sheet with a $1.95 billion cash injection and secured total dominance over the best gold district on Earth.

Internal friction regarding the IPO structure is a real near-term narrative risk. But when you look at the raw economic reality, Barrick is offering asymmetric leverage to a historic commodity cycle, backed by a hard catalyst for corporate value realization.

The starting gun just fired.

This analysis was powered by the ARMR Method™. To get my real-time insights, full portfolio access, and join a community of serious investors, explore our premium services

ARMRinvesting.com

DISCLAIMER: All of ARMR Report, our trades, strategies, and news coverage are based on our opinions alone and are only for entertainment purposes. You should not take any of this information as guidance for buying or selling any type of investment or security. I am only sharing my biased opinion based off of speculation and personal experience. An individual trader’s/investor’s results may not be typical and may vary from person to person. It is important to keep in mind that there are risks associated with investing in the stock market and that one can lose all of their investment. Thus, trades/investments should not be based on the opinions of others but by your own research and due diligence.

Right now, I’m watching it play out around AI.

And it highlights one of the most humbling truths about investing:

You can be right about an investment and still lose money on it.

And it’s not because the opportunity, research, or conviction is wrong.

It’s because the timing isn’t right.

You have to realize:

There are two separate decisions inside every trade.

The first: Is this a great opportunity?

The second: Should I buy it today?

Most investors treat those as one decision. They’re not.

Conviction answers the first question. (Yes, AI is a great opportunity.)

But it says nothing about the second. (No, now is not the right time.)

When you confuse them, you pay for it.

Artificial intelligence is at the top of my watch list.

After a deep dive into the AI data center buildout, my conviction in that long-term story has grown. I believe they’re building something real. I believe the revenues will come.

But the ARMR Risk Monitor is red. That means this environment doesn’t support adding new risk. Our algos aren’t giving me the signal that we’re on the right side of probabilities where reward is worth the risk.

My ‘conviction’ doesn’t change that. So I wait.

I take everything I believe about the opportunity and I put it in a box.

When the Risk Monitor turns green and the probabilities move in our favor, that’s when real capital goes to work.

My opinions don’t call the shots. The ARMR Investing Way risk-first methodology does.

Because you have to remember this:

Conviction tells you what deserves your attention.

Methodology tells you when the time is right.

That is how you break free of the ‘Right Idea, Wrong Time’ loop.

Protecting capital is not only about avoiding bad ideas… it’s also about avoiding good ideas at the wrong time.

Be the smart money,

Bret Rosenthal

Founder & CIO, ARMR Investing

p.s. The ARMR Report gives you the Risk Monitor signal before you put capital to work — so you always know whether the environment supports the move. Take a look.

My gift to you…avoid at all costs.

(It’s already -46% from the highs.)

Three weeks ago I shared with you something few people were saying:

I’m not interested in the SpaceX IPO.

I wouldn’t even put a dime into it for 6 to 9 months.

Last week proved I was right:

Down to $120, fifteen bucks below the offering price of an idea that was supposed to be the ‘deal of a lifetime’ for investors.

My whole professional career, I never liked investing in IPOs.

Inside investment banking, I witnessed the disregard for the individual investor firsthand.

I saw it too many times: investors believed the hype and got to hold the bag

They thought they ‘got in on the ground floor.’

What they didn’t realize: the elevator only goes down, and there are several sub-basements.

IPOs, while they help companies raise capital, are often just a sales job to help insiders dump stock.

As Matt Damon’s character says in Rounders,
“If you can’t spot the sucker in your first half hour at the table, then you ARE the sucker.”

In the IPO game, that sucker is almost always the retail investor.

I spent my career at the table. I know how it works. You deserve to know too.

That’s why I built the ARMR Report.

When you learn to manage your assets like a professional: with institutional insights, signals, and execution…

You avoid being ground under by the IPO hype machine.

On the ARMR trading desk we don’t make decisions based on FOMO, noise, or emotions.

We follow algorithms translated into daily Risk Monitor updates.

And we seek to do one thing exceptionally well every day:

Get on the right side of probabilities when reward is with the risk.

No fear. No greed. No emotion in our execution.

Just market cycles, algorithmic signals, and strong risk management.

That’s it. The rest is just distraction.

If you’re ready to eliminate distractions and execute with discipline…

Get the ARMR Report →

Be the smart money,

[BBR sig graphic]

p.s. I called the SpaceX drop three weeks before it happened. What I’m watching right now (and how we’re positioned for it) is inside the ARMR Report. Subscribe now.

p.p.s. Want the full $SPCX IPO analysis? Watch my original assessment here, and last Friday’s update here.

Subscribe now

It’s that you’ve never nailed your true risk tolerance, so the market keeps taking back what you earn every time volatility shows up. That cycle begins to end today.

I’ve been managing money for three and a half decades, worked with a lot of people, ran hedge funds for a decade. Here’s what I’ve observed:

Investors are able to uncover great investment themes. There’s no monopoly on a great idea. We can all do research. We can all figure that out.

What separates the average, frustrated investor, from the successful professional, is the process of putting capital to work.

In other words: executing a strategy with ruthless precision when things get hot in the kitchen.

And that all starts with understanding your risk tolerance.

I know, that’s a hackneyed phrase. But you really have to understand it if you’re going to build a strategy that’s going to make you money.

To clarify, that doesn’t just mean how much risk you could take. It’s not “Boy, this is too big, so I have to have a smaller portfolio.” It works the other way too.

If you’re not willing to put that risk out there correctly at the beginning of a rip in the market, you’re not making enough money either.

So the aggressive guy and the conservative guy are unable to capture the success of all the work they’re putting in to uncover the idea.

My die-on-this-hill belief that everything begins and ends with risk tolerance is actually why I started the ARMR Report™ on YouTube.

And I’ll tell you the behind-the-scenes truth: I did it to help myself.

One of my frustrations throughout the decades, something I expressed to my wife over and over again, was this lament:

I’ve got the greatest ideas. And at the end of the year, I’m not making the money I should be making.

You know that moment. When you look back and say,

“My ideas were unreal. But somehow my portfolio is not up to the level it should be based on the ideas I was looking at all year.”

Exactly. I told my wife that so many times. Then, one day she suggested I start a YouTube channel to talk about this problem and how to solve it. The idea was that I’d be on record and then forced to execute what I know.

In 2019 I finally took her advice. The result:

My portfolio success has gone through the roof since I started this process. And I have you to thank for keeping my feet to the fire, forcing me to execute what I speak.

Plus, the best thing that’s come out of the past six years is the ARMR Investing Way™.

We’ve distilled everything I do into the three-stage, nine-step process of putting capital to work correctly so we can recognize the success of all the great ideas we come up with.

This simple framework offers a path to stop reactive trading and execute with precise discipline — without all the emotion.

Over the coming weeks I’ll be sharing more with you about each stage and each step in the ARMR Investing Way™. Plus, how to execute with discipline through the full market cycle using this process.

The first thing to understand is this:

The process starts with the Risk Monitor, our proprietary algorithmic guide to money flows in the market.

Eight out of ten stocks follow the market. We follow ten indexes, eight of which are equity indexes, algos proprietary for each one.

When they’re all singing the same tune, it helps us understand where liquidity is flowing. Is liquidity coming into the market? That’ll be Risk Monitor Green. Is it flowing out of the market? It’s Risk Monitor Red.

The plan: Use the Risk Monitor to get on the right side of probability when reward is worth the risk. Put our capital to work. Execute that plan with ruthless precision.

To help you start getting on the right side of probabilities, we’ve created the ARMR Risk Tolerance Assessment™. (No opt-in, just direct access.) It’s a guide – a short test – to understanding what your risk tolerance actually is.

Right now the Risk Monitor’s Yellow. Perfect time to work on your plan so you can execute correctly when the Risk Monitor goes Green.

Go through the step-by-step assessment to figure out what your number is and how much risk can you actually handle when the volatility hits.

After you’ve done this, you’ll clearly see, “That’s the real number I can handle.”

And that’s the moment you begin to end the market taking back what you earn.

Mike Tyson said, “Everybody has a plan until they get punched in the face.” It’s the truth. And it’s the truth in the stock market too.

You can’t just go in swinging wildly. You’ll be down for the count. Protect yourself by first knowing your risk tolerance. Then, when the Risk Monitor goes Green, put your capital to work.

It’s your turn to be the smart money,

Founder & CIO, ARMR Investing

p.s. I’m sharing with you what I do personally and professionally. It’s your job to figure out your risk tolerance, and build a strategy you can execute so you can let your portfolio do what it’s capable of doing vs. getting blown out on volatility. Only you know that structure. You’ve got to be the smart money of your own assets.

The Core Thesis

Novo Nordisk’s revenue deceleration is real, multi-factorial, and largely anticipated. 2026 is an explicitly guided trough and reset year by design. Management is absorbing severe U.S. pricing resets, international patent expirations, and residual compounding headwinds to protect and expand global patient volume. While a V-shaped recovery is not on the table for this year, underlying volume expansion—led by the blockbuster rollout of Oral Wegovy and uncapped manufacturing—establishes the baseline for a renewed growth trajectory from 2027 onward. This is a classic transition from a hyper-growth biopharma story into a durable, high-quality healthcare compounder.

1. Why the Stock Is Down: The Growth Deceleration Breakdown

Following a massive multi-year expansion, Novo Nordisk’s growth trajectory cooled significantly across the last three quarters, turning into negative adjusted sales growth (-2% at constant exchange rates in Q4 2025 and -4% in Q1 2026). The valuation reset reflects five distinct compounding headwinds:

• Intensifying Competition from Eli Lilly: Lilly’s dual GIP/GLP-1 agonist, tirzepatide (sold as Mounjaro and Zepbound), has consistently demonstrated superior headline weight-loss percentages in clinical trials. This efficacy lead allowed Lilly to capture aggressive U.S. market share in the subcutaneous injectable space at the expense of Ozempic and Wegovy.

• Severe U.S. Pricing & Gross-to-Net Compression: Net realized prices in the United States have fallen sharply. This erosion is driven by unfavorable gross-to-net rebate adjustments, aggressive Pharmacy Benefit Manager (PBM) contract negotiations, reduced Medicaid coverage for obesity treatments, and broader government drug-pricing pressure under access initiatives and the Most Favored Nation (MFN) framework.

• The Compounding Pharmacy Flood: While Novo Nordisk navigated historical fill-finish manufacturing bottlenecks, compounding pharmacies exploited FDA drug-shortage rules. They flooded the U.S. market with unapproved, significantly cheaper copycat versions of semaglutide, siphoning off hundreds of thousands of prescriptions.

• International Patent Expirations (LOEs): Exclusivity for semaglutide began expiring in key international markets in 2026—most notably China, Canada, and Brazil—opening the door to low-cost generic and biosimilar competition outside the U.S.

• Restructuring & Tough Accounting Comps: Full-year 2025 reported figures were inflated by one-off accounting reversals (including a $4.2B U.S. 340B rebate provision reversal), creating difficult year-over-year comparisons. Concurrently, ~DKK 8 billion in company-wide restructuring costs and the financial integration of three Catalent manufacturing sites weighed heavily on near-term operating margins.

2. 2026: A Deliberate Trough and Reset Year

Management has been transparent and conservative: 2026 is guided as a down year on an adjusted basis (-4% to -12% sales and operating profit at constant exchange rates). This guidance reflects a strategic decision to absorb upfront pricing resets and structural competition in order to secure long-term formulary access and market share.

The Sequential Silver Lining: While 2026 represents the trough of the growth cycle, early sequential signals are positive. In Q1 2026, management modestly raised the bottom end of full-year guidance (to -4% to -12% from an initial -5% to -13%), driven by the explosive early adoption of Oral Wegovy. The baseline is stabilizing.

By taking the pain of price erosion and generic LOEs in 2026, Novo Nordisk is resetting its revenue base. The underlying quality of the franchise remains intact: adjusted operating margins remain elite, cash flow generation is robust, and R&D productivity continues to feed a premier metabolic pipeline.

3. What Will Make the Stock Go Higher: The 2027+ Catalyst Engine

Institutional consensus projects renewed, double-digit top-line expansion starting in 2027. Four primary drivers will power this upward valuation rerating:

A. The Blockbuster Scaling of Oral Wegovy (Semaglutide Pill)

Launched in the U.S. in early January 2026, Oral Wegovy is the primary near-term volume catalyst and a major differentiation point against Eli Lilly, whose oral candidate (orforglipron) hits the market later. Q1 2026 oral sales reached DKK 2.26 billion—nearly double the ~DKK 1.16 billion consensus—supported by over 1.3 million total prescriptions (~2 million since launch).

• True TAM Expansion: The tablet is capturing ~1/3 of new-to-brand prescriptions (NBRx), with ~80% of patients being GLP-1 treatment-naive. This proves the pill is expanding the Total Addressable Market to needle-averse individuals rather than pure cannibalization of injectable Wegovy.

• Channel Mix Evolution: While initial adoption was heavily cash-pay ($149–$199/month introductory pricing via telehealth), all three major PBMs added Oral Wegovy to standard commercial formularies by the end of Q1. As prescriptions transition to reimbursed channels, realized revenue per patient will steadily climb.

• Cardiovascular Label Moat: Oral Wegovy holds an exclusive FDA label for major adverse cardiovascular event (MACE) reduction, providing a critical competitive moat in institutional formulary placement. Ex-U.S. global launches slated for H2 2026 and 2027 will further supercharge volume.

B. Uncapped Manufacturing Capacity

The multi-billion-dollar acquisition and integration of three Catalent mega-manufacturing sites has permanently eliminated historical fill-finish bottlenecks. Unrestricted global supply enables Novo Nordisk to aggressively push volume into over 55 international markets where demand currently dwarfs supply.

C. Regulatory Crackdown on Compounding Pharmacies

As official FDA drug shortage declarations resolve, aggressive regulatory enforcement and legal action are shutting down compounding pharmacies producing copycat semaglutide. This regulatory shift is forcing substantial patient demand back into authentic, branded Wegovy and Ozempic.

D. Next-Generation Clinical Pipeline (The Efficacy Equalizers)

To neutralize Eli Lilly’s headline efficacy advantage, Novo Nordisk is advancing a robust late-stage clinical pipeline designed to lead the next wave of metabolic therapeutics:

• CagriSema: A fixed-dose combination of semaglutide and cagrilintide engineered to match or exceed the weight-loss percentage of tirzepatide, serving as the core commercial equalizer in 2027+.

• Amycretin & Monlunabant: Novel oral co-agonists and CB1 receptor inverse agonists that diversify the company’s mechanism-of-action footprint beyond standard GLP-1s.

4. What to Watch: The Leading Indicator Dashboard

To track the progression of this turnaround and identify optimal technical and fundamental entry points, monitor these four sequential metrics over the coming quarters:

The Bottom Line

The slowdown is real, but temporary. 2026 is a trough and reset year by design. As Oral Wegovy scales, manufacturing caps dissolve, and next-generation pipeline assets mature, Novo Nordisk is positioned for a multi-year growth rebound starting in 2027. Keep this compounder on your radar as volume metrics build and technical charts align.

This analysis was powered by the ARMR Method™. To get my real-time insights, full portfolio access, and join a community of serious investors, explore our premium services

ARMRinvesting.com

DISCLAIMER: All of ARMR Report, our trades, strategies, and news coverage are based on our opinions alone and are only for entertainment purposes. You should not take any of this information as guidance for buying or selling any type of investment or security. I am only sharing my biased opinion based off of speculation and personal experience. An individual trader’s/investor’s results may not be typical and may vary from person to person. It is important to keep in mind that there are risks associated with investing in the stock market and that one can lose all of their investment. Thus, trades/investments should not be based on the opinions of others but by your own research and due diligence.

Who this is for: You experience a “deer in the headlights” moment and fail to act when you should.

Why it matters: Putting capital to work closest to the Stop dramatically improves investment success and helps avoid the #1 Alpha killer…FOMO trades.

__________________________

When the risk environment turns favorable, that’s usually when the investor brain freezes.

You know what I mean:

You’ve done all the work, see the window opening, and then… inertia. That “deer in the headlights” feeling that keeps you from pulling the trigger.

In over 3.5 decades of investing, I faced down that moment many times. Then, I developed a way to beat it.

Now, I’m going to show you exactly how I do it.

By the end of this note you’ll have a simple rule to stop overthinking entries and actually get invested while the reward/risk is still in your favor.

It all begins with the fact that we have a strategy.

We follow algorithms because it gets rid of emotion.

The algorithms operate as a Risk Monitor giving us signals green, yellow, or red: risk on, manage success, risk off.

The weighted S&P 500 Index [$SPY] drives the bus, and the most effective armrAlgo is on said index. In over three years the armrSPXL Swing strategy [Swing Trading triple the S&P 500 [$SPXL] has been a phenomenal success].

Up over 189% in 32 trades.

So every time that strategy gives us an entry point, I put capital to work.

It doesn’t matter my opinions about what’s going on in the market.

If I get an entry point, I put capital to work. Period.

The first thing that has to happen for the Risk Monitor to go from red to green is the armrAlgo for SPY has to fire a Long entry. [This is the armrSPXL Swing strategy mentioned above.]

When that happens I activate the 72 Hours Rule:

Up to 30% of ARMR Flagship gets Long the indexes. [Usually SPY & QQQ using 2 or 3X ETFs.]

I start with a 10% exposure to the armrSPXL Swing strategy. That would be the first trade.

And if we get follow on buy triggers elsewhere, we add a couple other Indexes and we’ll have our Index exposure.

Then…

1. We go to our whiteboard and look for the Top 5 ARMR chart patterns.

2. Identify the armrAlgo buy triggers.

3. Map the entry points closest to the Stop where reward is worth risk.

4. Fill out the portfolio.

That’s the 72 Hours Rule in action.

Start with a 10% SPXL [or SSO 2X if more conservative] entry.

Use the next three days to fully deploy capital — or get stopped out and step aside.

This is the exact strategy behind the ‘Capital Deployment Timer’ in Step 3 of the ARMR Investing Way—and it’s how I execute with strict discipline through every market cycle.

When you’re managing serious capital, you don’t wing this stuff.

You use rules to discipline your feelings at these turning points.

Next time you’re stuck in inertia, try it: Risk environment turns favorable. Activate the 72 Hours Rule.

That’s disciplined execution — the kind that builds long-term wealth.

Be the smart money….

Bret

Bret Rosenthal

Founder & CIO, ARMR Investing

p.s. To reach your investing goals, you need to manage emotion. First step to that is knowing your number. Take the Risk Tolerance Assessment here.

Hyperscale data centers cannot infinitely scale to process every localized AI inference across billions of endpoints. You cannot put a 500-watt server rack in a battery-operated delivery robot, nor can you rely on a 100ms 5G round-trip to the cloud when an autonomous vehicle needs to brake for a pedestrian.

Enter Ambarella (AMBA).

Transitioning from legacy video processing into the pure-play physical AI inference layer, this fabless semiconductor company provides the relief valve for the AI ecosystem. Here is the high-conviction breakdown of why Ambarella is uniquely positioned to capture the edge inference wave.

The Core Reality: Solving for Power

Ambarella specializes in low-power, high-performance System-on-Chips (SoCs) for Edge AI and computer vision. Their proprietary CVflow architecture processes neural networks directly at the endpoint—the camera, the vehicle, the robot—at extreme energy efficiency.

This architecture fundamentally eliminates the latency, thermal constraints, and bandwidth costs of sending unstructured video data back to the cloud.

Where They Sit in the Stack

In the “Silicon-to-Glass” paradigm, hyperscalers dominate the heavy-lift training in the data center. Ambarella owns the distributed inference layer. They are an integrator, providing not just the silicon, but the Cooper Development Platform—a unified software stack allowing OEMs to port complex AI models seamlessly to the edge.

Fundamental Deep Dive & The Value Shift

Ambarella has successfully pivoted its revenue base, with Edge AI now accounting for 80% of total revenue. The macroeconomic focus is shifting from “AI Training” to “AI Inference,” and the economic value is moving directly toward Ambarella’s core competency.

Valuation Context: AMBA currently trades at a Price-to-Sales premium relative to legacy analog peers, but at a severe discount to cloud-AI silicon. If non-GAAP earnings leverage kicks in as Edge AI volumes scale, the current valuation fails to price in the margin expansion of the upcoming cycle.

Capital Allocation

• Balance Sheet: Pristine. The company holds $312.6 million in total cash and marketable securities with zero debt.

• Capital Returns: Management authorized an extension of their share repurchase program through June 2026, executing tactical repurchases while preserving cash for R&D.

Quantifying the Tailwind: The Economics of the Edge

To understand Ambarella’s value proposition, consider a fleet of 1,000 autonomous delivery robots.

The Cloud Processing Route: Requires a constant 5G uplink, paying perpetual cloud-compute egress fees, suffering 100ms+ latency, and heavily draining the robot’s battery just to maintain the connection.

The AMBA Route: A $50-$100 CV SoC processes the 3D-mapping locally.

The fleet operator cuts cloud compute costs by 80%, eliminates connectivity dead-zone risks, and extends battery life by hours. The economic uplift for the customer is structural, easily justifying AMBA’s ~60% gross margins.

Competitive Ecosystem & Moat

Ambarella punches above its weight due to its algorithm-first architecture. Unlike legacy players (NXP, Texas Instruments) who bolt AI accelerators onto general-purpose chips, AMBA designs silicon explicitly around its proprietary neural network processing engine.

The Moat: High switching costs. Once an OEM writes their software stack onto Ambarella’s Cooper platform for a vehicle or camera line, ripping it out requires years of recoding and safety recertification. Furthermore, their asset-light model (using TSMC for fabrication) shields them from foundry capital expenditures.

Strategic Roadmap & Catalysts

The next 36 months are defined by the transition from single-camera chips to centralized automotive domain controllers.

Current Phase: Industrial & Robotics Scaling

2025-2026

Executing on the long-term strategic agreement with Hanwha Group (a potential $800M pipeline over a decade) to embed AI in security and automated factories.

Near-Term Catalyst: Q2 FY2027 Earnings

Late Aug / Early Sept 2026

Watch for exact progress on the Hanwha deal and automotive backlog conversion.

Near-Term Catalyst: Auto-Tech Conferences

Fall 2026

Anticipated announcements of new Level 2+/Level 3 autonomous driving partnerships utilizing the CV3-AD family.

Mid-Term Shift: Semi-Custom ASICs

2026-2028

Expanding beyond off-the-shelf silicon to co-develop custom chips with tier-one OEMs to lock in long-term sticky revenue.

The Bear Case to Watch

The primary risks are customer concentration (heavy reliance on IoT security and Chinese OEMs exposing them to geopolitical tariffs) and R&D Burn. Competing with Titans requires massive R&D; if automotive design wins delay, operating expenses will compress margins.

Synthesis: The Bottom Line

Ambarella is a high-beta play on the physical deployment of AI. The financial reality—record revenues with 60% gross margins and a pristine balance sheet—provides a floor. The risk lies in the execution timeline in automotive; the reward is a monopolistic grip on low-power, high-performance edge inference.

As the industry maps out the physical constraints of AI, the ecosystem will be forced to push processing to the edge. For investors tracking the bottleneck of the AI supercycle, AMBA is a high-conviction integrator uniquely positioned to capture the value of the inference wave.

This analysis was powered by the ARMR Method™. To get my real-time insights, full portfolio access, and join a community of serious investors, explore our premium services

ARMRinvesting.com

DISCLAIMER: All of ARMR Report, our trades, strategies, and news coverage are based on our opinions alone and are only for entertainment purposes. You should not take any of this information as guidance for buying or selling any type of investment or security. I am only sharing my biased opinion based off of speculation and personal experience. An individual trader’s/investor’s results may not be typical and may vary from person to person. It is important to keep in mind that there are risks associated with investing in the stock market and that one can lose all of their investment. Thus, trades/investments should not be based on the opinions of others but by your own research and due diligence.

I stick to a very exact way of structuring entries, stops, and risk so that every trade fits inside a level I’m actually willing to live with.

By the end of this note, you’ll see exactly how I do it in a step-by-step process you can start using as early as today.

As a case study, I’ll use Qualcomm, a stock I recently highlighted on the ARMR live trading desk.

It all begins with the ARMR Five chart patterns and then ARMR buy trigger on companies that are on my whiteboard.

I’ve been looking for a way into Qualcomm ($QCOM) because the chart is just too perfect to me:

• double bottom at the fifty day moving average,

• initial rip higher as investors change their view of what’s going on at Qualcomm,

• breaks out of its base,

• comes down and tests the fifty day,

• makes a perfect double bottom, and

• now it’s starting to move.

That’s one of my favorite setups.

I like to go back and look at past great winners.

Let’s take a look at Qualcomm and then at Micron. You’re going to see it clearly: the same chart pattern.

If the chart pattern is the same on Qualcomm, then the reward for the risk I’m taking is exponential.

If you get that setup right and it expresses itself like it has in the past, the upside’s enormous.

The stop is still the same, so the risk is the same, but the upside’s enormous.

And of course the stop is going to be the double bottom low. So, the low there is $190.75.

If you’re uncomfortable with the distance to the stop, then you don’t change the stop – you change the position size.

Here’s how:

1. Figure out the dollars you’re willing to lose on the investment.

2. Look at where the stop is; do the math.

3. Figure out how big your position can be.

That’s how to put the capital to work.

Because if you put the capital to work and say, “I can’t handle that, so I’m going to raise my stop to here,” you’ll just get shaken out of things.

It’s position size that matters.

For me, I use the same position size on everything. Some of my stops will be small. Some of my stops will be larger.

Net-net, my stop will come in somewhere at an average level that I’m willing to accept. That’s how I do it.

Of course, at the end of the day, you’ve got to think for yourself. You’ve got to ask two questions:

1. How much risk can I take?

2. How do I express my opinion on the market?

Execute that and be the smart money,

Bret

Bret Rosenthal

Founder & CIO, ARMR Investing

p.s. I’m working on creating simple-to-execute ARMR rules for position sizing. What interferes with your discipline?

Kimberly-Clark (KMB) isn’t building artificial intelligence or discovering weight-loss drugs. Its underlying economics are tied to something far more predictable: inescapable human biology and demographics.

Through iconic, billion-dollar brands like Huggies, Kleenex, Kotex, and Scott, KMB operates on the foundational math of high-frequency, non-discretionary replenishment. They solve the consumer trust bottleneck at the retail shelf, converting raw timber and synthetic polymers into high-margin necessities.

More importantly, KMB is not merely a vendor. They are a critical anchor for retail foot traffic and shelf-space orchestration. They command physical real estate, forcing a structural dependency from global grocers, pharmacies, and big-box retailers.

Here is the deep dive into KMB’s current financial posture, their structural moat, and how to trade the stock in a normalized macroeconomic regime.

The Financial Engine & The Value Shift

KMB is a vertically integrated scale manufacturer that consistently prints cash. The financial health of the business is stable, but the source of its near-term value is pivoting.

• The Baseline: Annual revenues hover steadily around the $20 billion mark.

• Cash & Capital Return: Free Cash Flow (FCF) conversion remains elite, consistently generating north of $2.5 billion annually. Management is deeply defensive and shareholder-centric—KMB is a dividend aristocrat yielding roughly 3.5%, supported by a manageable payout ratio. Excess cash is systematically plowed into share repurchases.

• The Valuation Gap: KMB currently trades at a forward P/E of ~18x and an EV/EBITDA of 12x. This represents a slight discount to historical averages, and a measurable discount to its primary rival, Procter & Gamble (PG). The market is taking a “show-me” stance, waiting for proof of sustained volume growth.

The Value Shift: Over the last few years, KMB relied purely on pricing power to survive an inflationary environment and severe input cost shocks. We are now in a normalized regime. The economic engine is pivoting from defense (raising prices) to operational offense: expanding margins via supply chain optimization and raw material (pulp and resin) deflation. Operating margins are already successfully recovering toward their historical 14%–15% range.

The 3-Year Strategic Roadmap

To capitalize on this value shift, management is executing a critical structural reorganization over the next three years. It rests on three pillars:

1. Structural Reorganization: KMB is stripping out matrix bureaucracy by transitioning to three focused business segments: North America, International Personal Care, and International Family Care/Professional. The goal is faster, localized decision-making.

2. Premiumization: To outpace cheaper private-label alternatives, KMB is driving its product mix toward higher-margin innovations (e.g., skin-health-focused diapers and premium adult incontinence).

3. Supply Chain Modernization: Management is targeting $3 billion in gross productivity savings by automating manufacturing and consolidating their global distribution networks.

Quantifying the Tailwind: If KMB achieves just a 150-basis-point expansion in gross margins through these productivity initiatives and falling pulp costs, it generates an immediate $300 million in pure operating profit uplift on their $20 billion revenue base. This flows directly to the bottom line, highly amplifying EPS growth without requiring heroic top-line sales volume expansions.

The Competitive Ecosystem: Duopolies and Moats

To understand KMB, you have to understand the apex predator in the room: Procter & Gamble.

PG controls superior pricing power and broader category dominance. However, PG relies on KMB to maintain a rational pricing oligopoly. In key categories like diapers, the two titans act as a duopoly, keeping each other in check and preventing margin-destroying, race-to-the-bottom price wars.

Against legacy peers (like Kenvue or Edgewell), KMB executes with vastly superior supply chain scale. Against disruptive new DTC (direct-to-consumer) diaper brands, KMB leverages its massive retail distribution network to strangle challengers at the physical checkout aisle.

The Moat: KMB’s defensive wall is built on Brand Equity and a Shelf-Space Oligopoly. Retailers simply cannot afford stock-outs of Huggies or Kleenex. Furthermore, the massive capital requirements for raw material processing and global distribution create prohibitive barriers to entry for newcomers attempting to compete at scale.

Catalyst Watch & Risk Profile

What breaks this thesis, and what accelerates it?

The Bear Case (Downside Risks):

• Private Label Encroachment: Cash-strapped consumers trading down to store brands, particularly in the highly commoditized tissue and family care segments.

• FX Headwinds: Sustained strength in the US Dollar eroding the value of international revenue repatriation.

• Demographic Drag: Long-term headwinds from declining birth rates in developed markets shrinking the addressable market for baby care.

The Bull Case (Upside Drivers):

• Faster-than-expected realization of their $3 billion productivity savings.

• A steep, sustained drop in global pulp prices and transportation costs.

• Accelerated birth rates in key emerging markets driving volume upside in the Personal Care segment.

Catalysts to Watch: Pay close attention to upcoming quarterly earnings prints—specifically the pivot from price-driven growth to volume-driven growth. On the macro side, track global pulp inventory data and execution updates on KMB’s transition to the new three-segment organizational structure.

Synthesis & The Bottom Line

KMB offers a low-beta, high-floor financial profile. The downside is structurally protected by an elite dividend yield and non-discretionary product demand. The upside relies entirely on management’s ability to execute margin expansion and fend off private-label trading-down.

Because structural TAM (Total Addressable Market) growth remains inherently limited by global demographics, KMB is not a hyper-growth tech play. It functions strictly as a capital-preservation and income-generation vehicle.

The Playbook: This is a classic Stock to Watch. Wait for definitive technical support levels or a market-wide volatility spike to acquire shares at a discount. Once acquired at optimal levels, KMB operates firmly as a “Trading Around the Core” asset: harvest the 3.5% dividend, and systematically sell covered calls at the top of its historical trading range to manufacture alpha in a low-growth name.

This analysis was powered by the ARMR Method™. To get my real-time insights, full portfolio access, and join a community of serious investors, explore our premium services

ARMRinvesting.com

DISCLAIMER: All of ARMR Report, our trades, strategies, and news coverage are based on our opinions alone and are only for entertainment purposes. You should not take any of this information as guidance for buying or selling any type of investment or security. I am only sharing my biased opinion based off of speculation and personal experience. An individual trader’s/investor’s results may not be typical and may vary from person to person. It is important to keep in mind that there are risks associated with investing in the stock market and that one can lose all of their investment. Thus, trades/investments should not be based on the opinions of others but by your own research and due diligence.

I want you to see exactly how I’m thinking about putting capital at risk (or not) right now, because this is where net-worth-first discipline really matters.

I’m looking for trading opportunities. Could be long or short.

I don’t care if I miss an idea or two that goes up right now.

I only want to put money to work when the reward is worth the risk and the probabilities are in my favor.

Neither of those two factors can I say is happening right now. So I’m not putting money to work.

Our most conservative ARMR portfolios are doubling the performance of the S&P this year.

And our aggressive portfolios… the number is multiples of that. Up over fifty percent this year.

True, we’re going to miss something, there’ll be so many ideas that come out when the risk monitor goes green…

But whether it be cannabis, AI, data center, or precious metals…

I’m not in love with any investment story.

I’m only in love with my net worth.

That’s it.

I want my net worth to go up and I want to protect it.

I only want capital at risk when both the market environment and my individual setups are stacked in my favor; otherwise, my money stays on the sidelines.

This mantra drives the entire ARMR Investing Way:

You have to get on the right side of probability.

Invest in the ideas coming off the whiteboard when they sync with the market.

That’s your highest probability of success.

Everything else is what chips away at your portfolio.

Don’t show me the one or two stocks out of ten that go up when the risk monitor is red.

There’re always a couple of stocks that go up. For example, I think cannabis stocks are going to go up. But I don’t care.

If $TRLV or the $MSOS break down and hit my stop, I’m gone.

At the end of the day, if it’s not going up and it’s not making money, we don’t care. It doesn’t go in the portfolio.

That’s it for today. You make your own decisions.
Think for yourself.

And always: Be the smart money,

Bret

Bret Rosenthal

Founder and CIO, ARMR Investing

p.s. If you want the same risk map I use to know when the odds are actually in my favor, that is exactly what the ARMR Report delivers before the market opens every day.

Subscribe now

A few you’ve been circling for weeks, waiting for the right entry. You’ve done the homework. The ideas are good.

So why doesn’t the account ever quite catch up to the idea?

In 35 years of working with individual investors, I’ve heard some version of “I just need better ideas” more times than I can count.

Most investors think that’s the problem. I see it differently.

Finding a good idea was never the hard part. There’s no monopoly on that.

The hard part is taking that good idea and turning it into a real result.

And the gap between the two isn’t research.

It’s the volatility of the market cycle, and…

An investor putting capital to work at the wrong moment because feelings got there first.

It’s not your fault. It’s emotions.

When the market’s ripping higher, everyone wants to buy everything.

When it craters, everyone’s too afraid to put a dollar to work.

Same investor, same good ideas, completely different decisions.

It all comes down to how scared or greedy the tape made you feel that week.

I watched that pattern play out for good investors, year after year. Then, I decided to do something.

Not just for you – for me too.

In 2012 I told my wife, Rebecca, “I’ve got great ideas. Why am I not making more money?”

That’s the moment I decided to build a process that takes emotion out of timing.

The armrAlgos run across ten major indexes. Collectively, they make up what I call the Risk Monitor.

When it goes green, I put capital to work, because the probabilities are at their highest, not because I feel good about the market that day.

That’s the whole ARMR Investing Way in one sentence.

The indexes, the rules, the entries and exits – all of it exists to answer one question:

Is this a moment to act, or a moment to wait?

A good idea only becomes a good result if you act on it at the right time.

Be the smart money,

Bret

Bret Rosenthal

Founder & CIO, ARMR Investing

p.s. If you want the same risk map I use to know when the odds are actually in my favor, that is exactly what the ARMR Report delivers before the market opens every day.

Your account is near new highs. The indexes look great. And a small part of you knows this is exactly when you’ve given it all back before.

That’s the spot we’re in right now.

Most investors wait for the hit and then scramble to defend.

I start circling the wagons while the market still looks friendly.

That’s not pessimism. That’s how professionals protect a good year.

I’ve seen this setup before. More than once.

You ride a strong market up, your account looks great on paper, and then a fast downdraft turns a great year into a round-trip.

The trigger is always the same: it still looked fine last week, and you told yourself you’d lighten up later.

Later never came.

Right now I’m watching two things that tell me later is getting close.

First, the S&P is painting outside the lines of its uptrending channel. Not crashing. Just quietly slipping past the boundary it’s respected all year.

The Risk Monitor is still Yellow, which means we’re not at red alert. But late-stage Yellow is its own kind of warning. It’s the environment where the odds of a sharp air pocket rise. You just don’t know which afternoon it arrives.

Second, I’ve starting seeing “alligator jaws” showing up across the market. $TLT [Long US Bonds] down in price [rising yields] with $SPY [S&P500] ripping higher in a historic 2-month rally.

This is the ultimate example of Alligator Jaws waiting to snap shut on the greedy hands of equity investors.

And $AVGO is another clean example: Price keeps wedging higher. Relative strength keeps rolling lower.

That divergence, where the price looks fine but the underlying strength is quietly walking out the door, has almost never ended well for investors who stayed fully exposed.

Now, none of this means the market can’t go higher. It can. I’m happy to keep dancing with the girl I brought to the party.

But this is exactly why we run the Risk Monitor the way we do.

The job of a CIO – your job – is not to predict what happens next. It’s to manage what you can control right now.

So I’ve started circling the wagons.

That means….

• tightening stops,

• managing targets more actively, and

• trimming names that aren’t core holdings while the tape is still cooperative.

The true leaders, let them run. If they keep working, I’ll keep holding. But the rest of the portfolio gets a shorter leash.

The goal is simple: make sure a normal correction cannot turn into a 20-30% drawdown on the overall account. When you’re up, protecting that gain becomes the job. Chasing the last 5% is not.

In a late-stage bull, professionals don’t wait for pain to act. They use signals like Alligator Jaws to start protecting gains while the market still looks great.

You don’t need more ideas. You need a process that keeps you from ruining them. That’s not a defensive posture. That’s disciplined execution.

Be the smart money,

Bret

Bret Rosenthal

Founder & CIO, ARMR Investing

p.s. If you want to see exactly how I’m reading the risk setup, register for the ARMR Morning Meeting. Free for everyone. 30 minutes before the bell. I’ll walk through the Risk Monitor, show you what I’m doing with my own capital, and build the watchlist in real time.

But what they don’t tell you is that over-diversified is an Alpha killer. Watering down our strongest ideas leads to mediocrity. That is not risk management. That is fear dressed up as discipline

The investors I respect most aren’t the ones with the most names in their portfolio. They’re the ones who know exactly when to be big, and exactly when to step aside.

That distinction is what this video is about.

I walk through a real decision I made in real time: a pattern I’ve seen before, a rare setup I couldn’t ignore, and a rule I almost let stop me from acting on it. I break down the ATR framework I normally follow and why this particular setup was the exception.

I also show the math on what concentrated positioning has done for my portfolio over the last 14 months.

This isn’t a conversation about taking more risk. It’s a conversation about taking the right risk. There’s a difference, and most investors never find it.

Watch the full breakdown above.

Be the smart money,

Bret

This isn’t just a funding round. It is a strategic maneuver that alters the trajectory of custom silicon designers and the physical power grid. Here is a breakdown of the capital pivot, the infrastructure reality driving it, and the ripple effects across the broader AI ecosystem.

The Capital Structure Pivot & Leverage Limits

Alphabet currently generates north of $170 billion in operating cash flow over a trailing 12-month period, backed by massive cash reserves. However, the sheer burn rate required to maintain dominance is staggering. During their Q1 2026 earnings, Alphabet projected that capital expenditures will reach $180 billion to $190 billion by 2026.

Alphabet has traditionally relied on its cash flow and the bond market to fund growth. But having recently issued yen, GBP, and USD bonds, their total debt balance has pushed past the $100 billion mark. Relying solely on bonds at this stage chokes the balance sheet. Issuing equity is the necessary pressure release valve to sustain this historic capex avalanche.

The Berkshire Endorsement Crucially, this raise is anchored by a highly unusual $10 billion private placement to Berkshire Hathaway. Warren Buffett and Greg Abel acquiring $5 billion in Class A shares and $5 billion in Class C shares at a discount is a massive signal. Berkshire wants defensive, compounding assets. This placement allows them to take a commanding position in the infrastructure layer of the future without moving the open market price against themselves.

The Strategic Liquidity Squeeze

Beyond balance sheet management, there is a highly tactical, competitive edge to this raise.

By pulling $80 billion of liquidity out of the public equity markets comprising a $30 billion public offering and a $40 billion at-the-market (ATM) program starting in Q3 Alphabet is preemptively vacuuming up investor capital. Companies like Anthropic, OpenAI, and xAI are approaching the window where they need public offerings to fund their own infrastructure. Alphabet is effectively playing hardball, starving the impending IPO windows of its direct competitors.

The Grid Chokepoint: The Silicon-to-Glass S-Curve

The market initially treated the AI buildout as a pure silicon play. But the $80 billion isn’t just flowing to chip designers, it is being deployed into physical, industrial-scale infrastructure.

As we track the Silicon-to-Glass S-Curve, the primary bottleneck for AI expansion has shifted from securing GPUs to securing system capacity: energized sites, grid certainty, cooling infrastructure, and transformer availability. You cannot deploy tens of billions into hyperscale data centers without securing massive, uninterrupted base-load power.

This infrastructure reality is the exact catalyst aggressively repricing the nuclear sector and the uranium complex. The power grid is the new chokepoint for tech expansion.

The Silicon Derivative: $AVGO vs. $MRVL

For the semiconductor space, Alphabet’s raise is the direct funding mechanism for the custom ASIC backlog. When a hyperscaler secures this level of liquidity, it de-risks the out-year revenue projections for its primary design partners.

• The 5-Year TPU Master Agreement: Broadcom ($AVGO) recently formalized a massive structural agreement via an 8-K filing a 5-year contract securing them as the designer and supplier for future TPU generations through 2031, including the TPU v8 variants (Sunfish and Zebrafish). Alphabet’s liquidity ensures the balance sheet capacity to execute these massive purchase orders, supporting Broadcom’s target of $100 billion in AI chip revenue by 2027.

• The Anthropic Compute Backstop: This capital also injects liquidity into the broader ecosystem, supporting Broadcom’s active role in backstopping a complex financing structure to secure 3.5 gigawatts of TPU-based compute for Anthropic by 2027.

The Multi-Sourcing Threat However, a war chest this large also funds vendor diversification. Alphabet is actively multi-sourcing its custom silicon to prevent vendor lock-in. Marvell ($MRVL) has secured a portion of the next-generation TPU work, ending Broadcom’s perceived monopoly on the flagship program. While the overall capex pie is expanding massively, the fundamental dynamics of the $AVGO vs. $MRVL pair trade are shifting. Broadcom remains the incumbent heavyweight, but Marvell is now capturing critical incremental growth.

The Bottom Line

When a mega-cap tech giant moves $80 billion, the shockwaves reshape the landscape. The physical power grid and custom ASIC designers are the true, leveraged derivatives of this capital raise. Track the hyperscaler capex, but monitor the supplier allocations and the baseload power contracts.

This analysis was powered by the ARMR Method™. To get my real-time insights, full portfolio access, and join a community of serious investors, explore our premium services

ARMRinvesting.com

DISCLAIMER: All of ARMR Report, our trades, strategies, and news coverage are based on our opinions alone and are only for entertainment purposes. You should not take any of this information as guidance for buying or selling any type of investment or security. I am only sharing my biased opinion based off of speculation and personal experience. An individual trader’s/investor’s results may not be typical and may vary from person to person. It is important to keep in mind that there are risks associated with investing in the stock market and that one can lose all of their investment. Thus, trades/investments should not be based on the opinions of others but by your own research and due diligence.

The Core Reality: We are entering an era where AI makes writing code cheaper and faster. As the barrier to building software plummets, the economic bottleneck violently shifts to designing and defining what to build. Figma sits precisely at this choke point.

Figma (NYSE: FIG) is no longer just a digital canvas; it is the operating system for digital product creation. Operating on a product-led growth (PLG) model, it monetizes via subscription tiers targeting designers, product managers, and software engineers. Figma acts as the single source of truth where design systems, front-end code components, and product strategy converge. They do not just draw the buttons—they orchestrate the workflow of the modern software enterprise.

Here is a deep dive into why the recent structural reset in Figma’s valuation presents a generational entry point.

📊 Fundamental Deep Dive & The Value Shift

The macro environment has caused a broad software sector de-rating, but the underlying engine at Figma is compounding. The premium has washed out; the growth has not.

Key Financial Metrics

Capital Allocation & Insider Activity: Management is running a pure reinvestment playbook. Capital return (dividends/buybacks) is non-existent, which is appropriate for this growth stage. While recent regulatory filings indicate standard post-IPO insider selling (e.g., Brendan Mulligan, Tyler Herb), institutional accumulation is providing a sturdy floor.

The Value Shift: The secular shift is violently pro-Figma. Because GenAI tools compress development time, enterprises are initiating more software projects than ever before. Every new AI-assisted coding cycle requires a top-of-funnel design phase. Figma captures this volume spike perfectly.

🗺️ Strategic Roadmap & Quantifiable Tailwinds

Figma is actively expanding its footprint beyond the design department, targeting the entire product development lifecycle.

The Next 3 Years: Forward Roadmap

• Dev Mode Monetization: Bridging the final gap between static design and live code, capturing lucrative engineering budgets alongside design budgets.

• Native AI Generation: Embedding text-to-UI, automated asset tagging, and generative layout variations directly into the canvas.

• Enterprise Collaboration (FigJam): Expanding laterally into whiteboarding and strategy, directly attacking the broader PM and marketing software stack.

Quantifying the Tailwind (The Enterprise ROI): A standard enterprise deployment involves a 10:1 ratio of developers to designers. In legacy workflows, design hand-off friction wastes roughly 15% of a front-end developer’s week. By centralizing the design system in Figma, a 100-person engineering org (at a $150k average salary) recovers over $2.25M in wasted productivity annually. The software pays for its enterprise license within the first 60 days.

🏰 Competitive Ecosystem & The Moat

Figma stands alone in the highly technical, professional enterprise UI/UX arena. Adobe failed to buy them; they cannot out-build them.

The Titans Compared

Moat Analysis

• Network Effects: Designers build plugins, templates, and public assets in the Figma Community, drawing in a continuously growing user base.

• Absolute Switching Costs: Once a Fortune 500 company builds its proprietary “Design System” (component libraries, brand rules, interactive states) inside Figma, ripping it out requires halting the entire software production line. The lock-in is near-absolute.

⚠️ Catalyst Watch & Risk Profile

The Bull Case (Upside Drivers)

• Accelerated enterprise adoption of Dev Mode seats.

• A faster-than-expected macro pivot leading to a resurgence in enterprise IT/software spending.

• Successful upselling of premium AI features to the existing user base.

The Bear Case (Downside Risks)

• A protracted “software apocalypse” forcing tech companies to freeze headcount, thereby capping Figma’s seat-based revenue growth.

• Emerging threats from AI foundational models attempting to bypass wireframing entirely via “prompt-to-app” generation.

Catalysts to Watch

• Hard Catalyst: The next earnings print on September 2, 2026. Forward guidance will dictate if the current valuation floor holds.

• Soft Catalyst: The annual Config conference. Any announcements regarding next-gen autonomous design features will force immediate re-ratings by tech analysts.

🎯 Synthesis & The Bottom Line

The 2026 software reset has provided a generational entry point for an undisputed category leader. Trading at ~10x sales for a company driving the core infrastructure of digital product creation presents a highly asymmetric risk/reward profile. The downside is largely priced into the $22 stock; the upside leverages the entirety of the AI software boom.

Strategic Signal: High Conviction Buy

AI does not replace Figma; it supercharges its utility. As the cost of code goes to zero, the value of design goes to infinity. Figma is the tollbooth for the next decade of software development.

This analysis was powered by the ARMR Method™. To get my real-time insights, full portfolio access, and join a community of serious investors, explore our premium services

ARMRinvesting.com

DISCLAIMER: All of ARMR Report, our trades, strategies, and news coverage are based on our opinions alone and are only for entertainment purposes. You should not take any of this information as guidance for buying or selling any type of investment or security. I am only sharing my biased opinion based off of speculation and personal experience. An individual trader’s/investor’s results may not be typical and may vary from person to person. It is important to keep in mind that there are risks associated with investing in the stock market and that one can lose all of their investment. Thus, trades/investments should not be based on the opinions of others but by your own research and due diligence.

Welcome to a special guest post from ARMR analyst Erez Shapira.

Broadcom ($AVGO) is quietly pulling off one of the most significant architectural pivots in the semiconductor space and it has absolutely nothing to do with centralized data centers.

While the broader market remains hyper-focused on the custom hardware accelerator (XPU) war raging inside cloud hyperscalers, Broadcom is expanding its frontier. They are bringing heavy-duty, hardware-accelerated AI processing directly out of the cloud and straight into customer-premise equipment (CPE) sitting on living room television stands and office desks.

The mechanism for this shift is the launch of the BCM68850, the industry’s first 50G ITU-PON home gateway system-on-chip (SoC) equipped with an integrated Neural Processing Unit (NPU) and native Wi-Fi 8 compatibility.

As we approach Broadcom’s highly anticipated Q2 fiscal 2026 earnings report on June 3, this single piece of silicon completely alters the long-term semiconductor thesis. It shifts AI from an enterprise infrastructure story to an omnipresent broadband necessity.

The Hardware Architecture: A Triple-Threat Gateway SoC

Historically, broadband gateways have been functionally simple: receive a signal from an optical line, translate the packets, and distribute them locally via Ethernet or Wi-Fi. The BCM68850 completely tears up this legacy playbook by consolidating three massive hardware generational leaps onto a single die:

1. 50G Symmetric PON (Passive Optical Network)

The raw bandwidth capability of this chip is staggering. Delivering 50 Gbps of throughput in both downstream and upstream directions simultaneously represents a clean 5x performance leap over current state-of-the-art 10G XGS-PON infrastructure. Critically, it does this while meeting ITU-T standards, offering telecom operators a seamless upgrade blueprint over existing fiber deployments without requiring cost-prohibitive fiber-to-the-home (FTTH) rewiring.

2. Integrated Edge AI Engine (NPU)

This is the defining silicon innovation. By embedding a dedicated, hardware-accelerated Neural Processing Unit directly onto the gateway architecture, Broadcom shifts the gateway’s identity from a passive pipe to an active, localized compute node. The NPU allows for the execution of complex machine learning models directly inside the residential or small-office framework.

3. Native Wi-Fi 8 (802.11bn) Readiness

While consumers are just beginning to digest the rollout of Wi-Fi 7, Broadcom is skipping a generation ahead to establish technological real estate. Wi-Fi 8 shifts the wireless paradigm. Instead of chasing nominal, theoretical peak speeds under pristine lab conditions, the 802.11bn standard focuses ruthlessly on deterministic, ultra-reliable throughput. It implements advanced spatial reuse and coordinated beamforming to deliver a projected 25% reduction in worst-case latency and dramatically cut packet loss in high-density device environments.

The “Micro-Burst” Dilemma: Why Gateways Need Brains

Why do you need an AI brain inside a home gateway? The answer lies in how the next wave of consumer applications will fundamentally distort existing network architecture.

Broadcom’s design engineers have noted that the historical model of predictable, smooth data streaming (like Netflix or standard web browsing) is being replaced by massive, instantaneous “micro-bursts” of hyper-dense data. These traffic spikes are triggered by:

• Autonomous, persistent AI agents interacting in real-time across cloud networks.

• Ultra-HD immersive telepresence platforms requiring flawless, multi-stream spatial audio and video.

• Continuous local edge inference workloads communicating back-and-forth with cloud foundations.

A standard router trying to parse these chaotic, overlapping micro-bursts inevitably introduces jitter, buffering, and packet degradation. The BCM68850 solves this by using its local NPU to execute a “burst and release” traffic management technique. It handles dense, complex payloads in fractions of a millisecond, rapidly clearing the shared fiber channel.

Furthermore, processing AI data locally completely bypasses the traditional cloud trip. It slashes latency down to sub-millisecond levels, safeguards consumer privacy by processing sensitive spatial or behavioral telemetry locally, and minimizes backhaul bandwidth strain for the telecom provider.

Vertical Integration: Owning the Full AI Networking Stack

From a macro investment perspective, the BCM68850 is a textbook example of Broadcom’s core business philosophy: establish total ownership over high-barrier, high-margin, full-stack connectivity ecosystems.

Broadcom isn’t just selling a random chip to router manufacturers; it is providing a closed-loop, end-to-end 50G ecosystem for tier-1 telecom providers. The BCM68850 gateway SoC is engineered to integrate natively with Broadcom’s central-office BCM68660 Optical Line Terminals (OLTs) and their BCM55050 Optical Network Terminals (ONTs).

This full-stack dominance allows Broadcom to command immense pricing power. In the first quarter of fiscal 2026, AI networking revenues alone constituted roughly one-third of Broadcom’s total AI haul, with management projecting that share to tick up toward 40% as global infrastructure demands hit a wall of bandwidth constraints. The BCM68850 successfully extends this monetization moat from hyperscale cloud infrastructure down to the edge.

The Macro Investment Thesis: Fueling the $100B Milestone

This product launch acts as a concrete operationalization of Broadcom’s long-term AI inference thesis. Up to this point, the semiconductor boom has been an infrastructure training story. But training eventually shifts to deployment, and management has consistently emphasized that inference (the daily execution and scaling of AI models) will be the true multi-year driver of computing volume.

By integrating automated features like “Intelligent Self-Healing” networks and predictive local bandwidth allocation directly into consumer hardware, Broadcom is effectively manufacturing incremental semiconductor content demand where it previously didn’t exist.

The Near-Term Setup: Q2 Earnings

The timing of this rollout provides a massive tailwind ahead of the June 3 earnings release. Market expectations are incredibly high, with the stock holding strong in the $420–$428 range, pushing closer to a historic $2 trillion valuation.

Broadcom has already laid out exceptional guidance for the second quarter:

• AI Specific Revenues: Projected at $10.7 billion, representing an astonishing 140% year-over-year surge.

• Total Semiconductor Segment Revenues: Expected to come in at $14.8 billion, showing a robust 76% year-over-year increase.

While near-term upside will still be driven heavily by custom ASIC accelerators for hyperscalers, the BCM68850 provides the market with a tangible, long-term secular growth vector outside the data center walls. It adds immense fundamental weight to CEO Hock Tan’s aggressive roadmap: pushing AI chip revenue past the $100 billion annual mark by 2027.

Final Thoughts

The BCM68850 is proof that the AI transition is outgrowing its centralized cloud cocoon. As intelligence migrates down to the silicon level of everyday broadband devices, Broadcom sits perfectly positioned at the tollbooth of the world’s data pipelines. They don’t just build the cloud networks; they are building the intelligent edge.

This analysis was powered by the ARMR Method™. To get my real-time insights, full portfolio access, and join a community of serious investors, explore our premium services

ARMRinvesting.com

DISCLAIMER: All of ARMR Report, our trades, strategies, and news coverage are based on our opinions alone and are only for entertainment purposes. You should not take any of this information as guidance for buying or selling any type of investment or security. I am only sharing my biased opinion based off of speculation and personal experience. An individual trader’s/investor’s results may not be typical and may vary from person to person. It is important to keep in mind that there are risks associated with investing in the stock market and that one can lose all of their investment. Thus, trades/investments should not be based on the opinions of others but by your own research and due diligence.