Macro Correction and Recovery Forecast for 2026
"He's expecting a 20% plus correction in the first half, followed by a magnificent recovery up to new all-time high of about 7700 in 2026. This is a pretty amazing call and it's very similar to what I talked about in my latest market update video and I recommend you to watch it if you're interested. But he did mention that this is normal after multiple years of 20% plus gains. And if you look at the history over the last 20 years in terms of the S&P 500, anytime we have two or I should say three positive years, the fourth year tends to be a really negative year."
The insight highlights Tom Lee's forecast of a significant 20% correction in the first half of 2026 followed by a robust recovery to record highs. It underscores historical market patterns where strong consecutive years often lead to a subsequent downturn, raising concerns about market cyclicality. This macro commentary cautions investors to be aware of structural risks and cyclical downturns tied to economic and electoral uncertainties.
Rivian Overvaluation Signals Caution
"Rivian's market price is over $13 a share, and I still feel this stock is overvalued. The intrinsic value I calculated for Rivian is just over $3.50. Current market price is $13. So, it's still overvalued. Even after all of these declines, even after all of these years of difficult performance, the share price remains overvalued."
The speaker outlines a clear valuation gap for Rivian, noting its current market price of over $13 compared to an intrinsic value of just over $3.50. Despite management maneuvers amidst industry headwinds and restructuring, the stock is considered overvalued, signaling a trade caution or potential sell/avoid stance for investors.
Rivian: This Might Be the Next Big (Auto) Platform.
"RIVN: Positive cash from ops Q2 2025 signals platform viability. R2 model hits sweet spot ($50k SUV) w/ 50% cost reduction vs R1. Software/services rev up from $84M to $372M YoY (half from VW JV). Trading 3x P/S as emerging auto platform like Tesla, poised for non-linear FCF growth."