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How much is too much?

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Last week, banks, airlines, and other economically sensitive sectors felt the brunt of rising COVID cases across Europe. Major tech names and strong retail earnings did enough to counteract the negative pandemic sentiment with the S&P 500 and the NASDAQ finishing the week up 0.4% and 1.3%, respectively.

This week, sentiment looks to be against the stock market as it remains under pressure from a bond market that is looking increasingly jittery as the FED starts to wind down its asset purchases.

Sentiment Shift

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'Travel, good - stay at home, bad' has been the default position for markets over recent months. The likes of Marriot International and Airbnb have been rewarded while stay-at-home names such as Peloton and Zoom have cratered. Peloton has fallen over 70% from its pandemic highs, while Zoom has already slipped another 20% this week alone as investors reacted to a further slowdown in revenue growth. However, with COVID cases now rising again and lockdown measures being put in place across Europe, our heightened need for these stay-at-home names may not be over. Don't write these pandemic darlings off just yet. While momentum is likely to remain negative over the short term, the new lower price point will make for a more compelling investment.

How much is too much?

Nvidia: +161% YTD

Last week, Nvidia continued its phenomenal run as the tech giant reported a 50% jump in Q3 sales.

Nvidia is now the seventh-largest company in America and could soon become just the sixth company to reach a Trillion-dollar Market Cap.

While Nvidia's valuation multiplies are astronomically high, fixating on trailing earnings multiples has not been a rewarding investment strategy over recent years.

"The best performing stocks in the current era have never given you an opportunity to own them at parity with the market's multiple or below. And why would they have? Shouldn't the highest quality, fastest growing, best positioned companies have stocks that sell at a premium to the stocks of lesser firms?" - Josh Brown

While much of the future growth is already priced in, and 'quality at any price' is a potential pitfall, there is no denying that Nvidia is perfectly positioned to maintain its market-leading position well into the future.

Almost every company in the world will need to incorporate a digital and virtual arm in years to come. It's not just the tech giants that will drive future order flow.

Nike, for example, just announced last week that it is entering the metaverse via the launch of a virtual world known as 'Nikeland' on Roblox. Nike will be building an online store for Roblox users to try on virtual apparel, and it will have an arena for playing games mimicking the likes of the Super Bowl and the World Cup. Nike is not alone in this digital push as more and more companies look for ways to appeal to a younger audience.

As we move closer to a virtual world and the mythical metaverse becomes a reality, Nvidia's hefty valuation may become a little easier to comprehend.

Learn how to invest today, go to theislandinvestor.com.

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The late Peggy O’Callaghan was a founder of Kilcummin Scor

By Sean Moriarty Tributes have been paid to Peggy O’Callaghan, who was laid to rest on Tuesday of this week. Peggy played a central role in all activities related to Kilcummin parish. She passed away peacefully at her home on Friday, January 7. Peggy and her husband Michael founded Kilcummin Scor in 1978 – the […]

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By Sean Moriarty

Tributes have been paid to Peggy O’Callaghan, who was laid to rest on Tuesday of this week.

Peggy played a central role in all activities related to Kilcummin parish. She passed away peacefully at her home on Friday, January 7.

Peggy and her husband Michael founded Kilcummin Scor in 1978 – the music and drama arm of the local GAA club.

“It afforded the opportunity to females to participate in club activities long before ladies’ football was initiated and it brought many people into the club, many of whom remained involved in different capacities over the years,” said a club statement.

“She has left us a wonderful legacy and will be remembered fondly by those lucky enough to have met her.”

Peggy will be sadly missed by her husband Michael, sons Diarmuid and Shane, daughters-in-law Trisha and Áine, grandchildren Dara, Caoimhe, Donnacha, Siún and Éabha, brothers Seánie and Frank, brothers-in-law, sisters-in-law, nieces, nephews, grandnieces and grandnephews, extended family, neighbours and friends.

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Surprise: Details of town-centre inner relief road revealed

By Sean Moriarty Plans to link the Monsignor O’Flaherty Road with New St via a new road at Bohereen na Goun have been announced by Killarney Municipal District. Town engineer John Ahern told Wednesday’s Killarney Municipal District Meeting between elected councillors and senior council executives that Kerry County Council intends to make a compulsory purchase […]

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By Sean Moriarty

Plans to link the Monsignor O’Flaherty Road with New St via a new road at Bohereen na Goun have been announced by Killarney Municipal District.

Town engineer John Ahern told Wednesday’s Killarney Municipal District Meeting between elected councillors and senior council executives that Kerry County Council intends to make a compulsory purchase order on lands that will link the two town centre streets.

If plans come to fruition it will be possible for motorists on New St to get to the top of High St, adjacent to the Killarney Advertiser’s town centre office, without travelling through the town centre. The plan was first mooted as far back as 2016.

The announcement caught councillors off guard, it was one of the last topics discussed at the four-hour meeting, but it was broadly welcomed by all.

“This access will change the dynamic of traffic movement in the town forever,” said Cllr Niall Kelleher.

Further details of the surprise project are set to be revealed to elected members over the next four to six weeks.

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