A disciplined weekly review of the forces shaping risk and return.

Key Points

• Markets are up slightly this week.
• Consumer sentiment came in at 57.3, potentially signaling a new rise in overall sentiment.
• Intuit (INTU) selloff leaves the stock at roughly 17 P/E NTM.

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Markets

• International leads the week with 3.6% gain
• The Russel 2000 outpaced the S&P 500 this week as well, now leading the 6 month at 14.3% vs 6.4% for the S&P 500.

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Macro

Consumer Sentiment

Consumer sentiment rose to 57.30 this past week. See the 20 year history to put it in perspective:

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Equities

Intuit (INTU) Selloff

Every now and then a company will get overly sold. It happens to almost all companies in the long run. I wonder if Intuit (INTU) is in this same situation. Here is their historical price-to-earnings NTM:

These price levels have not been seen since 2022:

For those who don’t know, Intuit owns TurboTax, Mailchimp, CreditKarma, and Quickbooks. They have a few others, but these are the main ones.

There’s a fear around wallstreet about AI and it’s implications on software. The idea is AI will make software obsolete, as everyone can now theoretically make their own software for tasks like filing taxes, accounting, and customer relationship management.

The thing is, nobody knows the future. This could be a great buy, or a “value” trap. P/E multiples could revert on decreased earnings.

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Education

How The S&P 500 ETFs Work

A little fun trivia: in 2001, Enron was taken out of the S&P 500. NVIDIA took their place at roughly a 7 billion dollar market capitalization:

NVIDIA Corporation Replaces Enron Corporation In The S&P 500 Index

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Wealth

No two portfolios are the same.

When considering factors such as asset allocation, risk tolerance, time horizon, leverage, and personal financial circumstances, each portfolio ends up being highly individualized.

This is why following buy‑and‑sell commentary from TV or internet financial personalities can be risky. Those individuals are speaking to a broad audience, and they do not know your specific goals, tax considerations, or overall financial situation. While learning concepts and staying informed can be valuable, applying generic recommendations to your own situation may lead to unintended consequences.

If you’re considering making investment or financial decisions, it’s important to consult with a qualified professional who understands your personal circumstances.

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Quote of The Week

Good investing is a minority sport, which means that in order to earn returns better than everyone else we need to be doing things different to the crowd. And one of the things the crowd is not, is patient.

Nick Sleep

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Michael’s Corner

Checklist Approach

Last week we covered Inversion. This week we are covering the Checklist Approach. Thanks again to Charlie Munger who brought this to my attention.

Here, he’s talking about mental models:

The only antidote for being an absolute klutz due to the presence of a man-with-a-hammer syndrome is to have a full kit of tools. You don’t have just a hammer, you’ve got all the tools. And you’ve got to have one more trick: You’ve got to use those tools checklist-style, because you’ll miss a lot if you just hope that the right tool is going to pop up unaided whenever you need it. But if you’ve got a full list of tools and go through them in your mind, checklist-style, you will find a lot of answers that you won’t find any other way.

Munger, Charles T.. Poor Charlie’s Almanack: The Essential Wit and Wisdom of Charles T. Munger (p. 257). Stripe Press. Kindle Edition.

If this doesn’t make you want to learn about mental models, I don’t know what will.

Have a great weekend.

— Michael

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Disclosures

This newsletter is provided for informational and educational purposes only and does not constitute investment advice, an offer, or a solicitation to buy or sell any security. Walsh Financial is a Registered Investment Adviser.

The content is general in nature and is not intended to be advice tailored to any particular person, circumstances, or investment objectives. Any references to individual companies, securities, sectors, asset classes, market indexes, commodities, or economic and market conditions are for general commentary and discussion only and should not be construed as a recommendation or a call to take any specific action.

This information is not intended to provide, and should not be relied upon for, accounting, legal, tax, or insurance advice. Readers should consult with their financial advisor and/or other qualified professionals regarding their specific situation and the then-current applicable laws and rules before making any financial decisions.

All investments involve risk, including the possible loss of principal. Past performance is not indicative of future results. This newsletter may include opinions, projections, or forward-looking statements (including views on economic conditions, market trends, or broad investment themes). Such views are as of the date published, may change without notice, and there is no guarantee that any opinions or forecasts will prove to be correct.

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