Market noise is everywhere. Financial headlines focus on the same handful of stocks while important opportunities – the kind that can meaningfully impact your portfolio – often fly under the radar.
That’s exactly why we publish this watchlist each week.
While most investors get distracted by mainstream stories, we’re digging through earnings reports, analyzing technical setups, and monitoring where institutional money is flowing to identify companies at potential turning points. Our focus isn’t on what’s already priced in, but rather on what the market hasn’t fully recognized yet.
Each week, we spotlight three stocks that deserve your attention. We look for opportunities where timing, valuation, and potential catalysts align to create favorable entry points.
Here’s what caught our eye this week:
Amprius Technologies (AMPX)
Amprius Technologies has emerged as a high-conviction play on the expanding drone and defense technology markets, with shares surging over 187% year-to-date as the company benefits from the Trump administration’s strategic emphasis on domestic drone production capabilities. The lithium-ion battery manufacturer specializes in advanced battery systems for drones and high-altitude pseudo satellites (HAPS), positioning itself at the intersection of defense modernization and emerging commercial drone applications.
What makes Amprius particularly compelling is its strategic positioning as a critical supplier to key players building next-generation drone systems for military and commercial applications. The company’s advanced battery technology provides performance advantages that have outweighed concerns about its China-based manufacturing network.
The regulatory and policy environment has created powerful tailwinds for the business:
- President Trump’s “Unleashing American Drone Dominance” executive order in June
- Established domestic drone production as a strategic national priority
- Creates substantial demand for companies capable of supporting indigenous manufacturing capabilities
Amprius appears well-positioned to convert ongoing customer evaluations into large purchase orders as defense contractors and commercial drone manufacturers seek reliable domestic supply chains for critical battery components. The company’s technological advantages in lithium-ion battery performance have enabled it to maintain customer relationships despite geopolitical concerns about supply chain security.
Strategic manufacturing diversification provides additional competitive advantages:
- Manufacturing capacity in South Korea and potential European operations
- Offers pathways to address tariff concerns
- Serves Western-friendly military customers who prioritize supply chain security
- Geographic diversification becomes increasingly valuable as defense contractors minimize dependence on China-based suppliers
This positioning becomes increasingly valuable as the industry transformation is driven by both national security priorities and commercial drone market expansion.
Alphabet (GOOGL)
Alphabet presents a compelling contrarian opportunity as one of the most undervalued large-cap technology stocks, trading at a significant discount to both peers and the broader market despite delivering strong operational performance. Trading around $185 per share with a forward price-to-earnings ratio below 19, the Google parent company trades at a substantial discount to the S&P 500’s 23.7x multiple and well below other major technology companies.
What makes this valuation disconnect particularly intriguing is the stark contrast between market pessimism and actual business results:
- Alphabet delivered 12% revenue growth and 49% earnings per share growth in Q1
- Performance metrics that would typically command premium valuations if achieved by competitors
The market’s primary concern centers on potential artificial intelligence disruption of Google Search, with fears that generative AI tools could erode the search engine’s dominance and advertising revenue. While Google’s search market share did fall below 90% for the first time since 2015, this decline hasn’t materialized in financial results.
Google Search revenue grew 10% year-over-year in Q1, showing the resilience of the business model despite competitive pressures. The company has proactively addressed AI competition by implementing AI search overviews that provide generative AI-powered summaries of search results, potentially satisfying most users’ AI needs while keeping them within Google’s ecosystem.
The upcoming Q2 earnings announcement on July 23 represents a critical catalyst that could drive significant stock appreciation if Google Search continues showing resilience. Each quarter of sustained growth would further validate the thesis that mainstream consumers will continue relying on Google’s refined search experience rather than migrating to standalone generative AI tools.
The market appears to suffer from confirmation bias, where technology professionals who have adopted AI alternatives assume broader consumer behavior will follow similar patterns.
Ferrari (RACE)
Ferrari represents one of the world’s most prestigious luxury brands, combining exceptional craftsmanship with deliberate scarcity to create an investment opportunity that goes beyond traditional automotive metrics. Trading with a $90 billion market cap, the Italian supercar manufacturer has achieved remarkable financial consistency through its “deprivation marketing” strategy, purposefully limiting production to just 13,752 vehicles in 2024 to maintain exclusivity and pricing power.
What makes Ferrari particularly compelling is its extraordinary customer loyalty and pricing elasticity:
- 81% of new car buyers are existing customers
- Nearly half own multiple Ferraris
- Vehicle prices range from $200,000 to over $4 million for fully customized supercars like the F80
The company’s financial performance shows the power of controlled scarcity combined with relentless innovation:
- Five consecutive years of double-digit revenue growth
- Annual shipments increased 79% since 2015
- Revenue surged 134% to 6.7 billion euros
- Adjusted EBITDA soared 242% over this period, reaching a remarkable 38.3% margin in 2024
- Adjusted net profit has nearly quadrupled
This isn’t merely an automaker but a technology company where engineers comprise two-thirds of the workforce and the company invests approximately 45% of operating cash flow in capital expenditures and technology development partnerships.
Ferrari’s positioning for future growth extends beyond traditional automotive boundaries:
- Successfully attracts younger affluent customers, with 40% of buyers now under 40 years old
- Expanding revenue streams through racing events, sponsorships, theme parks, museums, and luxury experiences that generated 17% growth in 2024
- Upcoming launch of Ferrari’s first fully electric vehicle in three months
- Hybrid models already comprise 51% of sales
The company returned nearly all of its 1.2 billion euros in free cash flow to investors through dividends and buybacks, showing shareholder-friendly capital allocation.
Bottom Line
This week’s picks represent three distinct opportunities across different market segments and investment themes. Ferrari offers exposure to a recession-resistant luxury brand with pricing power and expanding addressable markets, Alphabet presents a compelling value play on an established technology leader trading at a discount despite strong fundamentals, and Amprius Technologies provides high-risk, high-reward exposure to the intersection of defense spending and drone technology advancement. Each stock combines attractive positioning with clear competitive advantages and catalysts that could drive meaningful returns as their respective growth stories continue to develop.