Dear Trader,

Charles here.

Hans is back with another One to Love, One to Leave. And this week he went right for the jugular on a question most investors are ignoring.

If AI agents are about to start doing real work (booking flights, managing code, executing trades) who actually benefits?

Not the model companies. Not the chatbot wrappers. The infrastructure underneath.

His pick to love is a company building the security and connectivity layer that every AI agent will need before it touches anything important. Think of it as the plumber for the agentic internet. Nobody talks about plumbing until the pipes burst.

His pick to leave? A toll booth operator that has collected fees on every transaction for decades. Still a phenomenal business. But Hans sees the road forking, and new lanes opening that do not run through the old booth.

If you followed his last call on this same stock, you know he has been watching this thesis develop for months.

Here is Hans with the breakdown.

One to Love: Cloudflare (NET)

If we are moving into the agentic phase of AI, then security stops being a side feature and becomes core infrastructure.

That is why I like Cloudflare (NET) here.

Cloudflare is not just "software." It is increasingly the connective tissue and security layer sitting between users, models, apps, APIs, data, and now AI agents. The company is positioning itself around helping customers connect, protect, and build AI apps and agents on one global network. Cloudflare One is being pitched as a platform to secure humans, devices, infrastructure, and AI agents together.

That matters because the agentic world is not just about smarter models. It is about more autonomous actions, more API calls, more machine identities, more prompt-injection risk, more authentication problems, and more opportunities for bad actors to exploit trust. Cloudflare’s AI Security Suite is built around exactly that problem, with protections for the AI lifecycle and tools like blocking prompt-injection attacks before they manipulate a model.

The reason I think NET fits this phase so well is that it sits in a much better place than a typical SaaS name. It benefits from the rise in traffic, the rise in verification, the rise in security checks, and the need to run inference closer to the user. Cloudflare’s Workers AI runs inference on its network with low latency. The company says its AI stack lets developers build and scale agents on one global network across 190-plus locations, with 50-plus models available close to users.

That is infrastructure.

If AI agents are going to do real work, then somebody has to verify them, route them, protect them, and help them act safely at scale. Cloudflare is becoming one of the most obvious picks-and-shovels names for that reality.

One to Leave: Visa (V)

This one is more subtle, because Visa (V) is not broken. It is still a phenomenal business.

But I think the market is underestimating how much the transaction layer is starting to evolve.

Ironically, Visa sees it too. The company is openly talking about agentic commerce going mainstream, the fight for identity entering the AI era, and stablecoins gaining traction. Visa has launched products around intelligent commerce, where AI agents can transact using tokenization, authentication, and transaction controls. It has also expanded stablecoin settlement, reporting annualized stablecoin settlement volume above $3.5 billion from the U.S. launch it announced in December 2025.

So why leave it?

Because once the transaction layer starts opening up, the moat may not be as clean as investors assume. Stablecoins, tokenized credentials, programmable payments, API-based agent commerce, and crypto-linked card products all point to a world where value can move in more ways, over more rails, with more intelligence built into the transaction itself. Visa is trying to participate in that shift. But participation is not the same thing as owning the whole economics of the future stack.

That is the key issue for me.

The market has long rewarded Visa as if the transaction layer was settled. I am not sure that is true anymore. The transaction layer is gaining momentum, fragmenting, and becoming more programmable. That does not mean Visa disappears. It just means the upside may be less obvious if more of the future value accrues to identity, orchestration, wallets, tokenization, stablecoin settlement, and agent-facing financial infrastructure instead of the classic card-swipe model.

So if NET is a way to own the trust-and-security infrastructure of the agentic era, Visa may be one of those great legacy businesses that suddenly has to defend its ground on a field that is changing shape.

Here for a good time AND a long time,

Hans

There you have it.

Cloudflare is building the plumbing for a world where AI agents need to be verified, routed, and protected before they touch anything that matters. Visa is still collecting tolls, but the road itself is splitting into lanes it does not own.

One builds the trust layer. The other defends it.

Take care,

Charles Delvalle

Managing Editor, Option Pit