The Underestimated Cost of Healthcare in Retirement - Your Money Briefing
As retirees get older, they could face additional costs including medication and doctors visits that could add tens of thousands of dollars to out-of-pocket expenses . Host Oyin Adedoyin talks with WSJ contributor Gail Marks Jarvis about how to prepare for unanticipated healthcare expenses in retirement.
Full Transcript
This transcript was prepared by a transcription service. This version may not be in its final form and may be updated.
Oyin Adedoyin: Here's Your Money Briefing for Monday, June 16th. I'm Oyin Adedoyin for the Wall Street Journal. Saving for retirement is hard enough; where you choose to live once you retire can add tens of thousands of dollars in healthcare costs, and then you have to factor in the costs of doctor's visits and certain medications.
Gail Marks Jarvis: There have been some estimates that have said that the average couple, instead of thinking they're going to spend $330,000, that maybe they'll have to spend over $600,000. That takes into account more of these unusual expenses that people may have to pay.
Oyin Adedoyin: We'll talk with Wall Street Journal contributor Gail Marks Jarvis about where these sneaky medical costs come from and how to prepare for them. That's after the break. Americans tend to enter retirement in relatively good health, but as they age, their health may start to deteriorate, which could lead to recurring expenses that can squeeze even the most affluent retirees. Wall Street Journal contributor Gail Marks Jarvis joins me to talk about it. So Gail, planning for retirement is kind of like trying to see into the future in some ways. We're estimating how much money we're going to need to live comfortably in our 60s and 70s. Your reporting has shown that medical costs can be a blind spot in that crystal ball. Why is that?
Gail Marks Jarvis: Well, in part it's because it's hard to know just what's going to happen to you medically. So a lot of people are going to go through retirement and spend about what Fidelity estimates, which is, during all of retirement, about $330,000 for a couple and about $165,000 for an individual. But you don't know if you are that average. What happens if you get sick and need drugs that are not covered by your drug plan, or what happens if you think you're really healthy when you're young and you move out to some isolated area and you get sick? So your expenses could be huge.
Oyin Adedoyin: Those are some pretty interesting numbers. Let's say that I'm a retiree with a pretty healthy nest egg saved up like that. Guidance from Fidelity says that retirees should have 10 times their salary by the time they're 67. How much of this is estimated to be eaten up by those medical costs that you mentioned?
Gail Marks Jarvis: If you have saved that 10 times amount and you average, you're probably going to be okay in terms of your medical costs. But if you start doing unusual things like going to a mountaintop to live in retirement where there's no doctors around or no good hospitals, that's going to change considerably. There have been some estimates that have said that the average couple, instead of thinking they're going to spend $330,000, that maybe they'll have to spend over $600,000. That takes into account more of these unusual expenses that people may have to pay.
Oyin Adedoyin: One of the things that you explain in your story as one of those unanticipated costs is Part D Medicare. Can you talk a little bit about how that works and how that can add to those costs when you're retired?
Gail Marks Jarvis: Just a few years ago, they added a new part of Medicare, and it's called Part D. and that's what's supposed to cover your drugs. You pay a premium every month, just like you pay a premium every month for Medicare. Medicare only pays about 80% of your medical costs, so the supplement pays the extra 20%, and the drug insurance pays some of your drug costs. But the key about Medicare Part D, the drug insurance, is that you are only covered by what your policy says they cover. What people don't realize is that their drug coverage is based on something called the formulary list that every drug plan has, and every drug plan is different. If you bought a drug plan and I bought a drug plan, each one would have a different formulary. So maybe a cancer drug would be covered in yours but not mine. So what do you do about that? If you're stuck with a drug that costs $9,000 and your plan doesn't cover it, for that year, you're going to have to pay the $9,000. But at the end of the year, you have the right to shop for a new drug plan. And what you can do then is pick a new drug plan that does have that expensive drug on the formulary list. And so instead of having to pay $9,000 again the next year, you pay only $2,000.
Oyin Adedoyin: Wow. Those costs are really adding up. Gail, what are some possible solutions and ways that people can either prevent the situation or navigate it?
Gail Marks Jarvis: Before they ever retire, while they're still on regular insurance, go to that community that they think they're going to live in, find a doctor, and get accepted by that doctor as a patient. They still could get turned down later when they go on Medicare, but doctors tend to continue to take patients that they have had even when they go on Medicare. A second step is just to realize that, for example, Florida is a place people go to cut their taxes, but they may have extra expenses, like they may pay more for medical care. So all of these things are things to think about in advance of retiring.
Oyin Adedoyin: Speaking of in advance, Gail, I'm 25. This is all blowing my mind right now. I have a 401k through my job, and that's it. What can I do now to ensure that I don't end up in that predicament where I'm underestimating future medical costs by the time I'm retired?
Gail Marks Jarvis: Well, it sounds like you're aware of the rule of thumb that when you go to retire, you want at least 10 times what you were making. But the other thing is, every year you should try to maximize what you're putting in your 401k, and you should make sure that you're at least getting the employer match. I have been shocked at the number of young people who say, "Oh, I have student loans. I'm busy. I can't figure out the 401k." And they skip it even though their employer would give them free money. Some of that free money, if you start in your 20s, that's liable to be like $250,000 of free money by the time you go to retire. So you don't want to ever give up that free money.
Oyin Adedoyin: That's WSJ contributor Gail Marks Jarvis, and that's it for Your Money Briefing. This episode was produced by Ariana Aspuru with supervising producer Melony Roy. I'm Oyin Adedoyin for the Wall Street Journal. Thanks for listening.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Yahoo
33 minutes ago
- Yahoo
Big Retail, Stablecoins, and Dividends. Oh My!
In this podcast, Motley Fool analysts Jason Moser and Matt Argersinger discuss: Why Walmart and Amazon are considering launching their own stablecoins. Roku and Amazon expanding their partnership. Two dividend stocks Matt thinks are worth getting on your radar: Whirlpool and Owens Corning. To catch full episodes of all The Motley Fool's free podcasts, check out our podcast center. When you're ready to invest, check out this top 10 list of stocks to buy. A full transcript is below. Before you buy stock in Amazon, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and Amazon wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $659,171!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $891,722!* Now, it's worth noting Stock Advisor's total average return is 995% — a market-crushing outperformance compared to 172% for the S&P 500. Don't miss out on the latest top 10 list, available when you join . See the 10 stocks » *Stock Advisor returns as of June 9, 2025 This podcast was recorded on June 16, 2025. Jason Moser: Big retail's taking a closer look at stablecoins. You're listening to Motley Fool Money. Welcome to Motley Fool Money. I'm Jason Moser. Joining me today, it's senior analyst Mr. Matt Argersinger. Matt, thanks for being here. Matthew Argersinger: You bet, Jason. Always glad to be with you. Jason Moser: On today's show, we're talking Amazon and Walmart's potential stablecoin aspirations. Roku and Amazon are teaming up in the ad market. We'll also take a look at a couple of Matt's favorite dividend stocks. But before we dive in, let's take a look at a few of the headlines driving the market today. After a tough Friday, markets are up today as the conflict between Israel and Iran continues. Now, according to Middle Eastern and European officials, Iran is signaling that it seeks an end to hostilities and wants to resume talks over its nuclear programs. Oil prices recently spiked because of the conflict, with WTI crude price up 11% over the last week. However, prices are down today on the news that Iran does seek to end hostilities. Let's hope that's the case. Finally, it's Fed Week. The Federal Reserve Interest rate decision is out on Wednesday at 2:00PM, with Chairman Powell's press conference to follow at 2:30. Matthew Argersinger: A lot going on, J Mo, but I have to say, does it surprise you as much as it does me how resilient the market has been this year? Here we are again on Monday. After that terrible news last week on Friday, we're again within 2-3 percentage points of an all time high. It makes you wonder what would need to happen to actually shake this market. Jason Moser: I'm not complaining, Matty, but yes, it is a bit surprising. Well, when we come back, big retail takes a closer look at stablecoins. Matt, we both read over the weekend about how Amazon and Walmart are looking at ways to possibly issue their own stablecoins, which, in turn, could, and I want to stress could, have an impact on payments companies like Visa and Mastercard, essentially by taking volume away from their massive networks. Now, I want to dig into this by asking, first and foremost, how exactly would this work? As a consumer, I'm hoping this isn't the case, are they going to force me to use stablecoins to make my purchases? Matthew Argersinger: No, not at all. I think if you're a consumer, who wants to do more transactions within the world of crypto, outside the banking establishment, this gives you another option. I think this is especially appealing to someone who might live outside the US or is doing cross-border transactions, who might live in a country with a more volatile currency, it becomes a nice benefit. It's a peg to the relative stability of the dollar without actually having to be in dollars. But if you're someone like me who has no problem with the banking establishment and generally likes to use credit cards for 99% of transactions, this won't affect you. Now, I think for Amazon and Walmart, it's a smart move. These are two of the biggest retailers on the planet, obviously. Not only does this potentially attract millions of new users who only want a transaction in crypto, it could potentially also save billions in processing fees that these retailers would otherwise pay to Visa, Mastercard, American Express, and banks to facilitate transactions. I don't think anyone should be surprised that Amazon and Walmart are getting into this. Jason Moser: I'm glad you made that cross-border point because that to me, seems one of the most obvious use cases. These are global businesses, obviously. That's something that could certainly benefit. Now, this also hinges very much on the regulatory environment, which seems clear as mud right now. It does seem like we really need to see more in the way of consumer protections, some type of regulatory framework if stablecoins are going to become a meaningful medium of exchange. To be clear, I think that's happening. It's something that's going to take some time, but when you look at it today, tens of millions of people globally, use stablecoins as a medium of exchange today. My suspicion is that probably grows over time. It's worth noting too, Visa and Mastercard are already partnering with crypto platforms to offer cards that allow you to spend against your stablecoin balance. It's not like Visa and Mastercard are ignoring the stablecoin opportunity. They're absolutely participating in it. I think investors should be encouraged by that, but if you look at Visa and Mastercard over the last five years, the stocks have basically more or less they've matched the market. Stretch that over 10 years, they've outperformed vastly. The longer you own these stocks, it seems like the more sense it makes. But let's look out over the next five years, particularly in this evolving space. How do you think these companies fare given all of these changes? Matthew Argersinger: The next five years, it's tough to say. But do stablecoins mean that these companies are disrupted and are going to do terribly over the next five years? I think that's an easy call. I don't think so. They're so dominant. Each operates in more than 200 companies, billions of issued cards outstanding, millions of merchants around the world that use them. You mentioned tens of millions of people using stablecoins, which is growing fast, but that's a drop in the bucket, compared to Visa and Mastercard's network. Keep in mind, consumers get a lot of benefits from using cards, especially credit cards. First, they're generally free to use. They give me rewards like cashback or airline miles or other benefits. Other than a stable currency, I'm not exactly clear what consumers get from using stablecoins. I know Circle and Tether get to earn interest on the float, but do consumers get anything out of it? I don't think so. Look, at the same time, though, I'm the last person who says big, dominant companies can't be disrupted, but over the next five years, I don't see it happening with Visa and Mastercard. In fact, as you mentioned with both companies, they can actually become big players in the crypto space themselves. I'd rest fairly easy if I'm a shareholder, and guess what? I'm, Jason. Jason Moser: Yeah, I think you're right. It boils down to incentives. You got to give me a reason to want to change over. Like you, I'm perfectly happy with my current banking relationship and how it enables us to spend our money and track our spending. It'll be fascinating to see exactly what these companies do. Next up, Amazon and Roku get a little closer, and we've got some dividend stocks you may want to keep your eye on. Matty, Roku and Amazon are teaming up, or rather, they're extending or expanding their relationship. This partnership will allow advertisers to reach roughly 80 million connected TV households through Amazon's demand-side platform. This seems like a space where we're seeing more partnerships in order to take advantage of this massive opportunity, the ad-supported video-on-demand space, that AVOD space. To be clear, like I said, Roku has already been working with Amazon's DSP to a certain degree, that demand-side platform. But this expanded partnership goes deeper, where programmatic in-stream video inventory is concerned. What do you make of this news today? Matthew Argersinger: Well, at first read, this definitely feels like a win for both companies. Obviously, given Amazon's size and other revenue sources, it's going to move the needle much more for Roku. But you've got this massive network of advertising touchpoints with Amazon's DSP. Now, you fully integrate that with Roku, which I think accounts for something like half or almost half of all TV streaming. That's impressive. If you're an advertiser, you now have a much greater scale, but also you can now be much more targeted because you're not having to potentially advertise to two audiences that already have significant overlap. I think it's a nice win for both companies, for sure. Jason Moser: You remember, it wasn't all that long ago, we weren't even talking about Amazon as an advertising business. It was just a little rounding error on the income statement. Maybe they made several million dollars, and now all of a sudden, they're operating on basically an $80 billion annual run rate with their advertising business. It's just phenomenal to see. Clearly, they've built out, I think, ways to win on both sides. Whether it's that demand-side platform or just through the content that they're slinging us through their many channels. This seems to make a lot of sense. Now, I think a logical question or at least the question that came to me, initially, is how this may or may not affect the Trade Desk. Obviously, a lot of our listeners are very familiar with the Trade Desk, a very popular recommendation in the Foolish universe. I think it's worth noting, Trade Desk shares are up today, so I don't think this was something that the market received negatively. In fact, Trade Desk and Roku announced their own partnership toward the end of last year. We're seeing a lot more collaboration in this space. It prompted the question to me like, is this a rising tide ultimately that lifts all boats situation? I feel like that's the most likely answer. When you look at the opportunity here in the advertising video demand space, the revenue in AVOD worldwide is expected to reach better than $54 billion this year. It's projected to hit $71.3 billion by 2029. It's growing, and I think part of that has to do with the value proposition, particularly in emerging economies or economies that maybe are not quite as well off as ours. It's just consumers get tremendous value, and I think we're seeing more and more consumers even here domestically getting that value. Netflix bringing advertising into their model as well. It seems like an exciting space. Now, that said, Roku's shares have had a tough go over the last five years, Matty. It's a big opportunity, like I noted, but it's a very competitive space. Is this a sign that Roku is getting things back on track? Do you see this from these levels today as potentially a market beater over the next five years, let's say? Matthew Argersinger: Here's my problem with Roku, Jason, and it's very superficial. I'm not sure who has actually made money investing in Roku. I don't want that to sound flippant, even though it is. But unless you brought Roku within its first few months of going public, in 2017, you've not only drastically underperformed the S&P 500, but you've lost money. The stock did soar in 2020 and 2021, but if you aren't lucky enough or savvy enough to sell during that time, you're down big from those highs. I'm not commenting on the business, and I think this expanded partnership with Amazon is definitely a good step. But is the company a good bet in the long run? Based on its track record as a public company, and that actually means something to me, it doesn't appear to be a good bet to me, Jason. Jason Moser: I'm an Amazon shareholder, I'm a Trade Desk shareholder. I don't own Roku, never have, and I don't think I ever will. Part of my hang-up with the business, following it since it went public, it's had to pivot a lot. Going from hardware to software and now trying to pooce their own content, going into advertising, all these different things. It's just tricky to see exactly where their primary focus is., I think I'm happy being a shareholder in Amazon and the Trade Desk and I'll just keep moving forward. Matty, let's wrap it up. We'll talk some dividend stocks. We all like cash in the pocket, and you run two of our different dividend services here that focus on dividends in income. I wanted to start firstly with your take on the metrics. What are one or two key metrics you think investors should prioritize when looking at dividend stocks? Matthew Argersinger: There are many. I would say, if you're just starting to look at dividend stocks, I think looking at how a company has grown its dividend, the growth rate of the dividend over time, and has that growth exceeded inflation on an annual basis? I think that is a tell that the company's growing its earnings, it's becoming a more profitable, more valuable company, and it's showing up in their dividends. It's a good proxy for a company's growth. Then related to that, check out the payout ratio. We all get enticed by companies that have high yields, 6, 7% yields. Generally, those companies are paying out a high proportion of their earnings out as dividends, and that can be unsustainable, especially if the company's earnings slow down or if it's a cyclical business. With dividend-paying companies, I generally like to see a payout ratio below 70%, even below 60% to be safe. Those would be the two I would focus on initially. Jason Moser: Occasionally, you just see that payout ratio fluctuate. It could be due to one time expenses or whatever it may be. I guess it makes more sense. Look for it over time. Matthew Argersinger: Maybe look at a five-year trend, and that give you enough information, probably. Jason Moser: Well, we've been talking about it all show. I know you've got some favorites in the space, Matty. Do you care to share if you have a couple of dividend stocks that you feel are worth getting on listeners' radar today? Matthew Argersinger: Absolutely. I've always got some favorites. I'd say there are two that stand out to me right now, and both are fortunately or unfortunately tied to the housing market. Just keep that in mind. I think both these can be winning investments from here, but they would do a lot better, Jason, over the next several years if there was a pickup in US home transactions. With that aside, the first stock is Owens Corning. The ticker is OC. We just rerecommended this in our dividend investor service here at the Fool. It's a leader in roofing and insulation. If you've ever been to Home Depot, Jason, looking for insulation for your roof or some other part of your house, you've probably seen the big pink bags with the pink panther images on them. That's Owens Corning. Really well-managed business. The dividend yield is only 2% right now, but it's been growing at double digit rates. Management has also been buying back a lot of stock. In fact, management is targeting one billion in combined dividends and buybacks each of the next two years. It works out really nicely for shareholders if you're looking at shareholder-yielding companies. My second idea is Whirlpool. Ticker WHR. I think everyone should know Whirlpool. It's North America's leading kitchen, bathroom appliance maker. You got brands like Whirlpool, of course, but Maytag, KitchenAid, InSinkErator are all Whirlpool brands. It was my stock on the radar last Friday during our Friday show. Whirlpool stock has really suffered over the last several years. It's had rising competition from Asia. As I mentioned, the housing market here in the US has been stagnant, but Whirlpool got some really nice news last week. It looks like the 50% steel tariffs that are being applied to various importers are also going to be applied to appliances. That's going to give Whirlpool, which manufactures the vast majority of its products in the US, a major leg up. Stock is very cheap, trades for less than 10 times forward earnings and has a dividend yield of almost 8%. It's a little bit riskier than Owens Corning, but I like the value and I like the turnaround potential. Jason Moser: I got to ask you one last question. You know what's coming. Looking at these two, Owens Corning, Whirlpool, do you have a favorite? Is there one you like over the other, or do these really just represent a nice way to get a good risk exposure? One, you said, obviously, Whirlpool, a little bit riskier, Owens Corning, maybe a little bit lower on the risk scale. Is it a nice 1, 2 punch in that regard? Matthew Argersinger: It's definitely a nice 1, 2 punch. I own both. If I had to pick one for the short run, I might go with Whirlpool. If I had to own one for the next five plus years, I would probably go to Owens Corning. I just think its business is less cyclical. It's much more tied to refurbishment and replacement, as opposed to Whirlpool, which, of course, needs people to be buying new appliances. I might go with Owens Corning in the long run, even though I like both. Jason Moser: We'll leave it there. Matty, thanks again for being here. Matthew Argersinger: Thank you, J Mo. Jason Moser: As always, people on the program may have interest in the stocks they talk about, and the Motley Fool may have formal recommendations for or against, so don't buy or sell stocks based solely on what you hear. All personal finance content follows Motley Fool editorial standards and are not approved by advertisers. Advertisements or sponsored content are provided for informational purposes only. To see our full advertising disclosure, please check out our show notes. I'm Jason Moser. Thanks for listening. We'll see you tomorrow. John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. American Express is an advertising partner of Motley Fool Money. Jason Moser has positions in Amazon, Home Depot, Mastercard, The Trade Desk, and Visa. Matthew Argersinger has positions in Amazon, Home Depot, Mastercard, Netflix, Owens Corning, Roku, The Trade Desk, Visa, and Whirlpool and has the following options: short September 2025 $90 puts on Whirlpool. The Motley Fool has positions in and recommends Amazon, Home Depot, Mastercard, Netflix, Roku, The Trade Desk, Visa, and Walmart. The Motley Fool recommends Owens Corning and Whirlpool. The Motley Fool has a disclosure policy. Big Retail, Stablecoins, and Dividends. Oh My! was originally published by The Motley Fool Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
an hour ago
- Yahoo
What Are the 5 Best Bargain Artificial Intelligence (AI) Stocks to Buy Right Now?
Looking for low PEG ratios can be one way to find stocks that are currently on sale. AMD, Broadcom, and Nvidia are all cheap chip stocks given their projected growth. Salesforce and Adobe are two SaaS companies riding the AI wave that have fallen into the bargain bin. 10 stocks we like better than Nvidia › In a fast-growing segment like artificial intelligence (AI), it's not always easy to spot bargains; however, they can be found. One of the best ways to find bargains in a hot sector is to look beyond stocks' price-to-earnings (P/E) ratios and instead look at their price/earnings-to-growth (PEG) ratios, as this metric takes into consideration their earnings growth. Stocks with PEGs under 1 are generally considered undervalued, and based on this metric, five of the best values in the AI space are Advanced Micro Devices (NASDAQ: AMD), Broadcom (NASDAQ: AVGO), Salesforce (NYSE: CRM), Nvidia (NASDAQ: NVDA), and Adobe (NASDAQ: ADBE). Let's look at why these bargain AI stocks could be great buys. With a forward PEG of only 0.2 based on its projected 2026 growth, AMD is one of the cheapest stocks in the AI space -- if it can live up to its growth expectations. The company has already been seeing solid growth, with its overall revenue climbing by 36% last quarter to $7.44 billion, while its data center segment revenue surged 57% to $3.7 billion. The growth is being led by the company's strong positioning within server central processing units (CPUs) and solid growth from its graphics processing units (GPUs). The former acts as the brain for computers, while the latter provides the processing power. While the market for CPUs is not nearly as robust as the one for GPUs in the data center space, it is still a nice, growing market, and AMD has been taking share. However, the company's biggest opportunity will come when the AI market shifts from training more toward inference, which is expected to eventually be the much larger market. Inference is less technically demanding than training AI models, and things such as latency, power consumption, and cost come much more into play. This should allow AMD to take some market share in the GPU space, which would fuel a lot of growth moving forward. Broadcom is another cheap chip stock with a big opportunity in front of it. The company is seeing solid growth, with revenue jumping 25% last quarter to $14.9 billion, led by a 70% surge in its networking revenue. However, it is its foray into custom AI chips that has the potential to really drive growth higher. The company has seen strong success with its first custom AI chip customer, Alphabet, which has led to it winning additional customers. It sees its three furthest-along custom AI chip customers being a $60 billion to $90 billion serviceable market opportunity in its fiscal year 2027 (ending October 2027). If it can capture much of this opportunity, then the stock has a lot of potential upside from here. Notably, that number does not include more recent custom chip customer wins, including Apple. With a PEG of around 0.4 based on fiscal 2026 earnings, Broadcom has some serious upside potential. The biggest risk for it, as well as AMD, would be a slowdown in AI infrastructure spending. Given their recurring revenue model, software-as-as-service (SaaS) stocks typically trade at premium valuations, but that is not currently the case with Salesforce. With a forward PEG of around 0.5, the stock is in the bargain bin. However, the company has strong data-center and AI opportunities ahead. It's been seeing strong momentum with its Data Cloud solution, which helps customers unify their data into a single source, while it is also looking to be an agentic AI leader with its Agentforce platform. Last quarter, its Data Cloud annual recurring revenue (ARR) soared 120% year over year to more than $1 billion, while its Agentforce platform reached ARR of $100 million after only being launched last fall. The company is looking to tightly integrate Data Cloud and Agentforce with its apps, such as Tableau and Slack, to help spark a new era of digital labor. Meanwhile, it recently introduced a new flexible Agentforce consumption-based pricing model more aligned with outcomes to increase customer satisfaction and drive adoption. While there is always a risk its strategy will not work, at its current valuation, there is not much downside if it doesn't and a lot of upside if it does. It's sometimes hard to believe investors can get the preeminent AI growth stock at a forward PEG of only 0.7 times. However, based on fiscal 2026 projections, that's Nvidia's current valuation. The company has grown its data center revenue ninefold over the past two years, and more growth is ahead. While competitors are trying to make inroads, Nvidia is still the dominant market share leader when it comes to AI chips. It had an incredible 92% market share in the GPU space in Q1. Nvidia's secret sauce remains its CUDA software platform, which it developed to help expand the use of its chips beyond their original purpose of speeding up graphics rendering in video games. It has since layered a collection of libraries and tools on top of CUDA that enhance the performance of its chips in AI tasks. Nvidia's newest chips remain in high demand, and the company is well positioned to continue to be one of the biggest beneficiaries of the current AI data center buildout. An AI infrastructure spending slowdown is a risk, but the stock is far from being priced for perfection, giving it solid upside potential from here. Adobe isn't a high-growth stock, but with a PEG of 0.8, it's fallen into the category of growth at a reasonable price (GARP). While AI isn't helping accelerate revenue growth, it has helped it settle in a nice, high-single-digit, low-double-digit range. The company is using AI to help drive results within its creative software solutions, as well as its products aimed more toward business professionals. At the heart of its strategy is its Firefly generative AI model. Using just natural language prompts, FireFly can help users generate images, video, audio, and vector content that they can further manipulate with Adobe's creative tools, such as Photoshop, all while ensuring intellectual property protection. Document Cloud and Express have also incorporated FireFly into their platform and can handle everything from summarizing documents in Document Cloud to text-to-video generation in Express. All in all, the stock is inexpensive, and it looks like AI should continue to help power Adobe's results moving forward. Before you buy stock in Nvidia, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and Nvidia wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $659,171!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $891,722!* Now, it's worth noting Stock Advisor's total average return is 995% — a market-crushing outperformance compared to 172% for the S&P 500. Don't miss out on the latest top 10 list, available when you join . See the 10 stocks » *Stock Advisor returns as of June 9, 2025 Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool's board of directors. Geoffrey Seiler has positions in Alphabet and Salesforce. The Motley Fool has positions in and recommends Adobe, Advanced Micro Devices, Alphabet, Apple, Nvidia, and Salesforce. The Motley Fool recommends Broadcom. The Motley Fool has a disclosure policy. What Are the 5 Best Bargain Artificial Intelligence (AI) Stocks to Buy Right Now? was originally published by The Motley Fool Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
an hour ago
- Yahoo
Jerome Powell Blames Trump Tariffs For Inflation—Analyst Claps Back, Says Fed Is 'Overplaying' The Card
Benzinga and Yahoo Finance LLC may earn commission or revenue on some items through the links below. The Federal Reserve bumped its median forecast for core inflation, which has left analysts divided as some believe that the central bank is overplaying the inflation story, while others say the impact of inflation cannot be overstated. What Happened: Despite acknowledging that inflation data was 'encouraging,' Jerome Powell noted during his press conference on Wednesday that the inflation median forecast has risen from 2.5% forecast in December, 2.8% in March, to 3.1% now. 'That's due to the effects of the tariffs.' Jeffrey Buchbinder, the chief equity strategist, and Jeffrey Roach, the chief economist at LPL Financial, said in their note that 'Inflation's importance to financial markets cannot be overstated.' Trending: Maker of the $60,000 foldable home has 3 factory buildings, 600+ houses built, and big plans to solve housing — They explained, 'Higher inflation can constrain economic growth, tighten financial conditions, drive interest rates higher, and even restrain stock valuations,' adding that it also 'dampens the present value of future earnings and, historically, correlates with lower stock valuations.' However, Jamie Cox, the managing partner at Harris Financial Group, said, 'The Fed continues to overplay the inflation story and isn't paying attention to burgeoning demand weakness.' 'Concerns from the Fed around deteriorating economic conditions and rising inflation remain roughly balanced and potentially keeping Fed policy changes in the abyss for the foreseeable future,' said Charlie Ripley, senior investment strategist for Allianz Investment Management. Northlight Asset Management CIO, Chris Zaccarelli, on the other hand, explained that the Fed was waiting to see if tariffs increase inflation or the jobs market starts to falter, and whichever part of their dual mandate is impacted first will likely guide whichever direction they take, 'although the bias is still toward cutting rates (or at least keeping rates unchanged; not raising rates).' Meanwhile, Eric Teal, CIO at Commercia Bank, said that 'The economy is less rate sensitive, and we believe a significant amount of easing would be required to impact consumer behavior.'Why It Matters: Craig Shapiro, a macro strategist at Bear Traps Report, said in an X post after the conference that 'Powell wasn't as dovish as I would have thought.' He was skeptical of even two rate cuts by the end of the year, saying, 'Frankly it's not even clear to me that he (Powell)is a 2 cuts guy for 2025.'Read Next: Invest early in CancerVax's breakthrough tech aiming to disrupt a $231B market. Back a bold new approach to cancer treatment with high-growth potential. Arrived Home's Private Credit Fund's has historically paid an annualized dividend yield of 8.1%*, which provides access to a pool of short-term loans backed by residential real estate with just a $100 minimum. Photo courtesy: Domenico Fornas / This article Jerome Powell Blames Trump Tariffs For Inflation—Analyst Claps Back, Says Fed Is 'Overplaying' The Card originally appeared on
