Latest news with #AndyBechtolsheim
Forbes
08-05-2025
- Business
- Forbes
10% Yield To Beat Any CD Or Savings Account?
What if you could earn a 10% annual yield on your capital - nearly double what even the best savings accounts or CDs offer today - while positioning yourself to potentially own a great business at a steep discount? That's exactly what's possible with a smart options strategy on Arista Networks (NASDAQ: ANET) - a company founded by Andy Bechtolsheim, the legendary investor who wrote the first check to Google's founders, Larry Page and Sergey Brin. Compare this yield with current high-yield savings rates, which rarely cross 4.5%, and often much less at large banks like JPMorgan, BofA, or Goldman Sachs. Suddenly, this strategy doesn't just look attractive - it looks compelling. The strategy is reliable because large institutions have tested the strategy at scale, and for the right long-term investors, may serve just right. As an aside, the Trefis High Quality portfolio targets long-term value creation and has outperformed the S&P 500 and achieved returns greater than 91% since inception. ANET stock is trading around $86. You can sell a long-dated Put option - expiring June 18, 2026 - with a strike price of $65, and collect $640 in premium per contract (each contract represents 100 shares). That's almost a 10% yield on the $6,500 you're setting aside for the possibility of buying the stock. And here's the kicker → You're agreeing to buy ANET at $65 - 25% discount to today's price - only if the stock drops below that level by the expiration date. This is what investors call getting paid to wait. Two outcomes: In short, you win either way, especially if you're comfortable owning a quality company for the long haul. If you do end up owning ANET stock, you're not stuck with some speculative small-cap. You're holding a company that: The best part? With ANET's focus on providing network equipment for data centers and cloud computing companies - this may be the right time, especially if you believe in the broader AI and data center growth story. ANET doesn't have the same hype that is associated with Nvidia or Broadcom, but we believe may in fact be better positioned in a world where people can't seem to have enough data. See ANET's key metrics and financials in analysis: Buy or Sell ANET Selling puts is only as good as the quality of the business you're willing to own. Luckily, with ANET, the downside risk is inherently low, thanks to exceptional fundamentals that make the company a far cry from speculative tech. A great asymmetric risk-reward offer with a built-in 25% margin of safety These are the kinds of margin-of-safety setups and asymmetric risk-reward tradeoff that we seek in the Trefis HQ portfolio, which is focused on long-term value creation. With a collection of 30 stocks, it has a track record of comfortably outperforming the S&P 500 over the last 4-year period. Why is that? As a group, HQ Portfolio stocks provided better returns with less risk versus the benchmark index; less of a roller-coaster ride as evident in HQ Portfolio performance metrics.
Forbes
08-05-2025
- Business
- Forbes
Break-Up Alphabet And Declare Communism?
Google parent company Alphabet's (NASDAQ:GOOG) CEO Sundar Pichai took the stand on April 30th, in court proceedings, to determine this: How should Google parent Alphabet be punished? Yep, how to punish Google! If we didn't know what Google was, one would think we're talking about destroying an enemy in warfare. Or, maybe America wants to turn into communist China, faster than China aspires to rival American capitalism's success! At our core, we believe in cutting through the noise. While regulators debate how to discipline today's tech leaders, we focus on understanding what actually drives long-term value and apply that principle to our High Quality portfolio, which has outperformed the S&P and clocked >91% returns since inception. The proponents of Google's break-up have a simple message: Google's parent Alphabet must be broken. It has too much power. Google Search, Android, Chrome, YouTube are each massive, and collectively, it's a scary beast. Certainly a valid lens to see things through. Right? Let's step back. This is Google. A company created on this soil, started in Silicon Valley, with founders who dropped out of Stanford - supported by longtime tech executives like Sun Microsystems' Andy Bechtolsheim, and VCs like Sequoia, right here in this country. This is an American classic! It's a poster child of the American dream. This is our company. So why break it up? Why the envy? Why destroy? Why not think about making it even bigger. More powerful. More celebrated? 80% of people in this country, if offered a job at Google, would be delighted to accept it. Maybe more than 80%. From software engineers, to English and Philosophy majors, marketeers, and even Biochemists, there are opportunities in different corners of what is now the Alphabet empire. What has Google really built that makes it so attractive? While it's easy to see what are Google's parts, and how you can break it up, it's much harder to fathom the role of cultural ties between these parts - the unspoken work ethics, the balancing of innovation with operational excellence, and perhaps efficient teamwork across seemingly-disparate groups, are probably more valuable than is obvious at first blush. Isn't there an opportunity to learn from that culture? Build it out, bigger, spread it, rather than stifle? How incredible would it be if instead of just 185K people that Google employs, 10x more, say 2 million people could learn from that culture - be a part of it - grow and develop it to the next level? It's childish to break what you don't understand. Isn't it fair to say, what you don't know how to build, you don't really understand? Building is hard. It takes imagination, courage, and focus. Laser-like focus, and years of tinkering. Breaking-up takes none of that - you see what's there, and you break it into parts. That's not building. Creative destruction starts with a hypothesis, a mission - about something way bigger. Current dialog about breaking up, and analysis surrounding it - is just that. Analysis. There is little imagination and creativity, far from a plan that's been proposed to show how we create something 100x or even 10x of what is the current Google. Unless we can come up with a concrete plan, do we deserve to try to break Google? The solution must be to grow. If Google founders created a company worth $2 trillion from nothing - how can we together grow it to 20 trillion dollars? Tax them. Sure. Ask them to share a higher percent of profits. Why not? Give Google more responsibility - set a higher cultural and social bar across the board for companies that generate more than $100 billion in net profits annually. Isn't that way more responsible than breaking it up? Instead of navel-gazing, let's harness Google's culture to solve real problems. Plenty of problems exist: from reliable and cheap access to information, to clean energy, to democracy, and people's rights around the world. In fact, the Google founders saw that - they created Alphabet with the expectation to perhaps use the leverage of an effective culture - a culture that has worked to build diverse businesses from Verily, and Isomorphic, to Waymo, and Wing. The point is - when you bring the best under one umbrella, there is room for magic. These didn't exist. They take imagination. Demonstrate boldness, and have a shot at magic. The real enemy is not Google, it's a lack of imagination. Lack of imagination makes you weak, makes you fight. Makes you think breaking-up. If a trillion looks big today, it'll probably look tiny in 10 years - if only we are insolent enough to imagine the outrageous $20 trillion behemoth that Alphabet can be in the next 10 years! While others argue over breaking up today's winners, we're busy identifying tomorrow's giants. It's that forward-looking imagination and discipline that has helped Trefis High Quality (HQ) Portfolio, which is a collection of 30 stocks, comfortably outperform the S&P 500 over the last 4-year period. What does that mean? As a group, HQ Portfolio stocks provided better returns with less risk versus the benchmark index; less of a roller-coaster ride as evident in HQ Portfolio performance metrics.
