Hey,
Charles here.
2026 has been weird.
Stocks that everyone wrote off as dead money are suddenly waking up: Cisco, Nokia, names that haven't mattered in 20 years.
Meanwhile, names that should be safe keep grinding lower for one reason: AI can do their job. That's the line in the sand right now.
Either you have something AI needs, or AI has you in its sights.
Andrew flipped through his scanner this week and found a stock on each side of that line.
Here's Andrew with one to love and one to leave.
AI bringing stocks back to the land of the living is now a known quantity. Cisco Systems (CSCO) just jumped on great earnings and is up about $30 this year for its best performance in years. Nokia (NOK) is having a similar resurgence.
The stock that's jumping the most for me is Qualcomm (QCOM). Since the recent news on their chip sales, Qualcomm burst from a 52-week low on April 7 and has since had open interest (the total number of options contracts held open by traders) jump near 40 percent. That's the fastest OI growth for the stock since it bounced off that low.
What's driving the bid: Qualcomm’s automotive revenue jumped 38 percent last quarter, and management is projecting 50 percent year-over-year automotive growth for Q3. That's the diversification story finally showing up in the numbers.
Qualcomm recently traded near $240 and has since pulled back with the swoon in AI-related tech.
QCOM 1-Year Chart
Qualcomm can easily lift back to $220 by midsummer. All it takes is one news story. In the meantime, chip demand keeps rolling and Nvidia (NVDA) will tell more of that story on Wednesday, May 20.
Another AI casualty
Plenty of stocks are hitting 52-week lows, or close to it. Here's another one that's very close, and AI has the business in its sights.
Trimble Inc (TRMB) is a global engineering technology company that focuses on geospatial technologies (tools that map and track physical locations). That's square in the scope of what AI seeks to simplify. Trimble shows the same stock pattern that has befallen many of these companies since last summer: slow decline, then drop, slow decline, then drop.
TRMB 1-Year Chart
Trimble just gave bad guidance that kept compounding pain after the date. Bernstein cut its price target on TRMB from $99 to $85 even while keeping an Outperform rating. When the bulls are walking back targets by 14 bucks, something's broken under the hood.
Until this company comes up with some AI-friendly news, it'll keep making 52-week lows.
Andrew Giovinazzi
Markets always reward the stocks that adapt and punish the ones that don't. Cisco and Nokia figured it out.
QCOM looks like it's next in line.
Trimble? Still waiting for the press release that turns the chart around.
Until it shows up, the tape is going to keep doing what the tape does.
The real question: what will the team pick on Monday?
Join the Ticker Highlight Show Premium before Monday at 10:30 AM ET to find out.
See you there,
Charles Delvalle
Editorial Director, Option Pit