Rigetti Computing (NASDAQ: RGTI), a quantum computing company that makes hardware, software, and cloud systems for the technology, has seen its share price surge more than 1,000% over the past year. Whenever a company's stock goes like absolute gangbusters, it's worth taking a closer look and asking, "What makes this company so special?"

Sometimes, the answer is that it's not special. Perhaps investors are just following the pack or betting on a meme stock. Other times, they may be right and have seen something others didn't notice earlier. In either case, share price gains of that magnitude warrant a closer observation of the company.

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Is Rigetti special and worth buying, or are investors getting caught up in the hype? Let's take a look.

Image source: Getty Images.

Pros: Quantum computing could be significant

Artificial intelligence (AI) receives most of the attention among tech investors, but quantum computing will likely be a transformational technology across many industries, including drug discovery, materials science, climate modeling, and financial forecasting, among others.

The key aspect of quantum computers versus traditional computers is that the former can process data as either zeros or 1s, or both at the same time, which allows them to make many more calculations simultaneously.

This technology could create up to $850 billion in economic value by 2040, according to the Boston Consulting Group. Hardware and software from quantum computing, like what Rigetti produces, could be worth up to $170 billion by that time.

Some investors have latched on to this opportunity with Rigetti's stock. They may have noticed that the company has large tech customers, including Amazon and Microsoft, as well as contracts with the U.S. government, and believe they're getting a glimpse into quantum computing's potential.

Cons: Quantum computing is unproven, and Rigetti's sales are falling

Despite the upside of this technology, Rigetti faces some significant headwinds. First, the quantum computing market is still unproven. Even other companies that have their own quantum computers, like Alphabet, believe that real-world applications are years away.

That's not great news for Rigetti, and neither is the fact that the company's sales are falling. It generated only $1.5 million in revenue in its first quarter, a 52% decline from the year-ago quarter. Management has said that significant commercial sales are still three to five years away.

Meanwhile, the company is burning through a significant amount of cash, with an operating loss of about $22 million in the first quarter.

Verdict: Avoid this stock for now

To recap, Rigetti is betting on an unproven market, its sales are falling and won't be meaningful for years, and its operating losses are significant.

I think it's far too early to invest in it, especially since the company doesn't expect significant revenue for many more years. And the quantum computing market is fairly speculative right now, with companies and investors hoping for breakthroughs that are years away, if they come at all.

Even if you're optimistic about the company's potential, Rigetti's share price looks far too expensive, with a price-to-sales ratio of 272, extremely costly by any standard.

While Rigetti has the potential to benefit from quantum computing years from now, betting on this expensive stock right now is far more of a speculative move than a long-term investment strategy.

Should you invest $1,000 in Rigetti Computing right now?

Before you buy stock in Rigetti Computing, consider this:

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Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Chris Neiger has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Alphabet, Amazon, and Microsoft. The Motley Fool recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy.

Shares of the aftermarket automotive products company Advance Auto Parts (NYSE: AAP) were climbing today after a report released this week showed that demand for used vehicles is rising. If Americans continue to hold on to their older vehicles, it could help spur more auto parts sales.

Investors may have also been pleased to see that one of the company's rivals, AutoZone, reported solid same-store sales growth in its first quarter yesterday, indicating a strong demand for auto parts.

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Advance Auto Parts stock is up 5.3% as of 1:33 p.m. ET.

Image source: Getty Images.

A minor upside of automotive tariffs

Investors may have been responding to a report this week by The Wall Street Journal showing that demand for used vehicles is on the rise because of automotive tariffs. Used car supply at dealer lots is falling fast and hasn't been this low since the COVID pandemic.

Tariffs on imported vehicles and some auto parts have helped push new vehicle prices higher, to an average of about $49,000 in April, according to Cox Automotive. As a result, Americans are looking to buy used cars instead and holding on to existing vehicles longer. That's good news for Advance Auto Parts, which caters to both automotive mechanics and car owners looking to make vehicle repairs.

Advance Auto Parts investors may also be responding to rival AutoZone's recent earnings report, released yesterday, in which the company's same-store sales rose 3.2% in the quarter. The rise in sales shows that demand for auto parts continues to be strong, and Advance Auto Parts investors were likely hoping that the company will be able to tap into that trend.

A long road ahead

Advance Auto Parts is in the midst of a turnaround, and the company still has its work cut out for it, as its sales fell 7% in the first quarter. Still, the company's revenue and earnings were both ahead of analysts' consensus estimates, and the company reiterated its guidance for the full year.

Advance Auto Parts' share price is still down about 25% over the past 12 months, and investors will want to pay close attention to the next few quarters to see if the company can successfully tap into the surge in used car demand. There's plenty of uncertainty in the automotive market right now, which means that investors may want to sit this stock out until the company shows more signs of life.

Should you invest $1,000 in Advance Auto Parts right now?

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Shares of the Chinese autonomous-driving company Pony AI (NASDAQ: PONY) were falling this morning. The decline came after reports that TuSimple, a maker of self-driving trucks, sent sensitive autonomous-vehicle data to China even as it promised the U.S. government not to disclose information based on national security concerns, according to The Wall Street Journal.

Pony AI isn't part of the controversy, but the U.S. and China aren't exactly on the best of terms right now amid tariff concerns and geopolitical positioning. The reports about TuSimple are likely worrying some investors that the U.S. could take a more restrictive approach on how autonomous-vehicle data is collected by Chinese companies.

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Pony AI's stock was down by 13.8% as of 11:16 a.m. ET Wednesday.

A Pony AI self-driving vehicle. Image source: Pony AI.

Tensions are high between the U.S. and China

The U.S. is increasingly focused on protecting data and technology created here from being exported to Chinese companies and the Chinese government. That's led to restrictions on what types of semiconductors can be sold to China and protections against American social media data being exported to China.

That's why the Journal's report that TuSimple shared self-driving trade secrets with China could be affecting Pony AI's stock today.

Pony AI has permits to operate its autonomous vehicles in several states, and investors may be worried that TuSimple's supposed actions may reflect poorly on the company and potentially lead to increased government scrutiny.

Another factor that could be affecting the company's stock price today is that Chinese electric-vehicle (EV) companies are slashing prices. For example, BYD is one of the leading EV companies in China, and it just cut its vehicle prices by up to 34% for some models. Pony AI works with several Chinese EV companies, and investors may be concerned that a slowdown in the EV industry there could hurt its business.

Potentially more volatility ahead

With Chinese EVs facing headwinds, tariff uncertainty between the U.S. and China, and now concerns over autonomous-vehicle data, there are plenty of variables that could cause Pony AI's stock to remain volatile right now.

That doesn't mean it isn't a good long-term buy, but investors should be aware that the global automotive industry is facing significant pressures right now, and that's spilling over to companies connected to the industry, including those in self-driving tech.

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Chris Neiger has no position in any of the stocks mentioned. The Motley Fool recommends BYD Company. The Motley Fool has a disclosure policy.

Quantum computing is getting a lot of attention from investors right now as some look for the next big thing in the tech space. The result has been some high-flying quantum computing stocks, with Rigetti Computing (NASDAQ: RGTI) rising 823% over the past year.

But Rigetti's stock is taking a breather right now and is down 23% since the beginning of the year. That pullback may make buying Rigetti stock an alluring idea to some investors.

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Here are three reasons why you should resist the temptation.

Image source: Getty Images.

1. Quantum computing is still a mostly unproven market

Rigetti makes quantum computing hardware, software, and quantum computing cloud systems that it sells to customers, and some of them are big tech players like Microsoft and Amazon. The company is tapping into a quantum computing hardware and software market that could be worth up to $170 billion by 2040, according to Boston Consulting Group.

But while Rigetti's customers and sales are more than theoretical, the mass adoption of quantum computing is still speculative. There aren't many practical applications for quantum computing at the moment, and most companies are still trying to figure out how to reduce the amount of errors their systems produce.

Does quantum computing hold lots of promise to surpass existing computing capabilities? Absolutely. But is Rigetti or any of its peers on the cusp of truly revolutionizing how companies and consumers process information? Most likely not. This makes any investment in the company right now a fairly speculative move.

2. Rigetti's sales are slipping

One thing that start-ups in a new market should be able to do is increase sales. But Rigetti's revenue has been on a downward trajectory. The company has sales of just $1.5 million in its recently reported first quarter, down nearly 52% from the year-ago quarter.

This wasn't just one bad quarter of sales, either. The company's full-year 2024 revenue was $10.8 million, down 10% from the previous year.

Rigetti's management said on the first-quarter earnings call that significant commercial sales won't occur until about three to five years from now. Meanwhile, the company's operating loss widened to nearly $22 million in the quarter.

It's worth noting, though, that the company has $237.7 million in cash and cash equivalents. So it's likely Rigetti has enough money to continue its operations for a while. But it also means that if you buy shares of Rigetti now, you shouldn't expect significant revenue from the company for a long time.

3. Rigetti's stock is shockingly expensive

Rigetti's shares have a price-to-sales multiple of 197, which is very expensive by any measure. Investors have gotten ahead of themselves in their optimism over this stock and driven its share price up over 800% over the past year. I'll reiterate here that Rigetti had just $1.5 million in sales in the most recent quarter, and those sales are declining.

Buying this stock now, after its massive share price gains and high price-to-sales ratio, looks like an unwise move. Instead of buying Rigetti now, a much better option may be to wait and see if the company is able to significantly increase its sales and narrow its losses over the next few years.

Betting your money in a speculative market on a company with unproven results that's already experienced unwarranted share price gains seems much more like gambling than investing.

Should you invest $1,000 in Rigetti Computing right now?

Before you buy stock in Rigetti Computing, consider this:

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John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Chris Neiger has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Amazon and Microsoft. The Motley Fool recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy.

There are plenty of good places to invest your money right now, but tariffs and economic uncertainty are making it much harder to feel confident about buying stocks in some sectors.

I tend to be cautious about where I put my money, but one investment that almost always looks like a good place to invest is the Vanguard S&P 500 ETF (NYSEMKT: VOO). Here are five reasons it would be my only choice if I had to pick just one stock -- or in this case, an exchange-traded fund -- for my retirement portfolio.

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1. Instant diversification

One of the best things about the Vanguard S&P 500 ETF is that the money you invest in it will be spread across 500 of the largest U.S. companies, which make up the S&P 500. Because the exchange-traded fund tracks the S&P 500 index, you won't have to worry about picking stocks across a variety of sectors -- you can enjoy a base level of diversification as soon as you own the fund.

With the Vanguard S&P 500 ETF, there's less of a need to know which sector is booming or which company is inventing the next big thing. This is ultimately a bet on the long-term rise of the broad market.

2. It has a fantastic track record

While the common financial disclaimer, "Past performance is not a guarantee of future results," applies to this fund just like it applies to every other stock you might own, the S&P 500 does boast a long history of gains.

The index has delivered an average annual rate of return of 10.1% (not accounting for inflation) since 1957. This Vanguard ETF won't return that exact amount annually -- there will up years and down years. But given enough time, the S&P 500 has always rebounded from its lows and made significant gains.

3. It's inexpensive to own

All funds charge fees, usually quantified as an expense ratio, and the average fee for index equity ETFs is 0.14%. That's already quite low, but Vanguard's fund is a standout for its ultra-low annual fee of just 0.03%.

That means that for every $10,000 you have in the fund, you'll pay just $3 annually. This is especially important as your portfolio grows over time. With the Vanguard S&P 500 ETF, you'll keep more of the gains you make from the market because of the fund's industry-low expense ratio.

4. It's easy to buy and sell shares

While Vanguard's ETF is a fund that tracks the S&P 500, it's not any more difficult to buy and sell than any other stock. This means that if you need to sell some shares of the fund quickly, exit your position, or buy new shares, you can do it the same way you would with any stock through your preferred brokerage.

And because the fund is one of the most popular options out there -- it's the largest Vanguard ETF -- it's highly liquid for when you're ready to sell.

5. You'll have exposure to some of the best companies in the market

The S&P 500 index is composed of some of the largest, most stable, and profitable companies, which means you'll be invested in quality businesses.

Of course, that doesn't mean the fund is immune to volatility -- it's been on a wild ride over the past few months in response to tariffs -- but it does mean that your money is invested in a fund that tracks the growth of many industry-leading companies.

It's worth mentioning that given the considerable uncertainty in the market and economy right now, even stable, profitable companies can underperform in this environment. That's why it's important for investors to remember that if you buy the Vanguard S&P 500 ETF, you should plan to hold onto it for years, just like any other stock, in order to reap the full rewards.

Should you invest $1,000 in Vanguard S&P 500 ETF right now?

Before you buy stock in Vanguard S&P 500 ETF, consider this:

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Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $614,911!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $714,958!*

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*Stock Advisor returns as of May 5, 2025

Chris Neiger has positions in Vanguard S&P 500 ETF. The Motley Fool has positions in and recommends Vanguard S&P 500 ETF. The Motley Fool has a disclosure policy.

The past few months have not been kind to most tech stocks. The tech-heavy Nasdaq Composite is down 8% year to date as investors worry that President Trump's tariffs will impede technology companies' growth.

Apple (NASDAQ: AAPL) has not been immune to the volatility with the stock tumbling 22% this year. More importantly, the company is expecting challenges ahead despite solid results from its most recent quarter. Here's where Apple could be one year from now.

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Image source: Apple.

The good and bad of Apple's second quarter

Investors were wondering how tariffs would play into Apple's latest results and outlook, but they didn't have much of an impact on the fiscal 2025 second quarter (ended Mar. 29). CEO Tim Cook said on the earnings call, "For the March quarter, we had a limited impact from tariffs as we were able to optimize our supply chain and inventory."

Cook noted that Apple is now sourcing many of the iPhones slated for sale in the U.S. from India, and most of its other products headed for the U.S. are now coming from Vietnam. Apple reshuffled its production after President Trump slapped a cumulative 145% tariff on many imports from China.

Beyond that challenge, Apple reported some positive results. Sales climbed 5% year over year to $95.4 billion, beating Wall Street's consensus estimate of $94.6 billion. The tech giant's earnings of $1.65 per share also outpaced the average analyst estimate of $1.63 per share. Meanwhile, the company's important services segment grew nearly 12% to $26.6 billion, though that fell short of the analyst consensus estimate of 14% growth.

Despite the company's solid sales and earnings growth in the quarter, there are still dark clouds on the horizon for Apple stemming from the new tariffs.

Where will Apple be over the next year?

Tariffs have made it especially difficult for companies and investors to know where a company is headed, especially in the near term. Many management teams have pulled their guidance for the year, and some have even issued two sets of guidance based on whether or not the tariffs stay in place.

Apple is struggling to forecast its results as well with Cook saying on the call, "I don't want to predict the future because I'm not sure what will happen with the tariffs [...] it's very difficult to predict beyond June."

But he did shed some light on how tariffs will dent the company in the current quarter: They will add $900 million to Apple's costs. And that's likely just the beginning.

Cook said investors shouldn't take the $900 million estimate from the current quarter and use it to make projections for future quarters "as there are certain unique factors that benefit the June quarter."

In short, things could get worse

To make matters worse, tariffs are likely to change. The broad 10% tariff on imported goods from nearly all countries remains, while higher reciprocal tariffs are on pause. Meanwhile, China faces 145% tariffs on most of its exports to the U.S., but the administration says it's talking with China to lower the temperature on the trade war. Even more confusing is that President Trump has walked back some tariffs for specific industries and sectors.

All this adds up to a situation where companies like Apple are trying to navigate a complicated regulatory environment where the rules are less than clear.

Another indicator that the next year could be less than stellar for Apple is the fact the company cut its stock buyback authorization for the year by $10 billion, down to $100 billion total. Companies sometimes reduce their repurchase programs when they're uncertain about the future.

The volatile nature of this administration's trade policies means that having a near- to medium-term outlook for many companies is nearly impossible. Tariffs could eventually force Apple to raise prices on its products or absorb some of the costs and weigh down its earnings. To what degree this happens is still unknown, but Apple investors should brace for difficult times ahead if U.S. trade negotiations fall apart.

Should you invest $1,000 in Apple right now?

Before you buy stock in Apple, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Apple 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 $614,911!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $714,958!*

Now, it’s worth noting Stock Advisor’s total average return is 907% — a market-crushing outperformance compared to 163% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

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*Stock Advisor returns as of May 5, 2025

Chris Neiger has positions in Apple. The Motley Fool has positions in and recommends Apple. The Motley Fool has a disclosure policy.

Shares of AppLovin (NASDAQ: APP), an adtech company, spiked by 12.4% this week, according to data compiled by S&P Global Market Intelligence, after the company reported better-than-expected revenue and earnings and said it would sell its gaming division.

The sale will not only generate cash for AppLovin, but allow the company to focus more on its adtech business, which is the company's fastest-growing segment.

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Investors may also be responding to the AppLovin CEO's blog post expressing interest in merging with TikTok Global (for assets outside of China). No official deal has been announced, and the company said the move is admittedly "a long shot."

Image source: Getty Images.

Investors are lovin' the company's momentum

AppLovin reported earnings per share of $1.67 in the first quarter (which ended March 31), up 149% from the year-ago quarter and ahead of Wall Street's consensus estimate of $1.45. The company's revenue of $1.48 billion also outpaced analysts' average estimate of $1.38 billion and was a 40% increase from the year-ago quarter.

Sales from the company's important advertising segment were also impressive, rising 71% in the quarter to $1.16 billion. The company's apps revenue declined by 14% to just $325 million.

But investors weren't worried about the company's app revenue decline because AppLovin announced that it's selling its mobile gaming business to Tripledot Studios. The move will give AppLovin $400 million in cash, a nearly 20% ownership stake in Tripledot, and allow the company to leave its apps business behind and focus its attention on advertising. The deal is expected to close in the second quarter.

A moonshot move

As if it weren't a big enough quarter already for AppLovin, the company's CEO Adam Foroughi wrote in a blog post yesterday that his company is pursuing TikTok Global in an effort to merge with the company, specifically for all assets outside of China.

The company said it's pursuing a merger, not a buyout, and that the combined company could boost TikTok's annual revenue from its current ad revenue of $20 billion and help it reach $80 billion annually.

But investors should know that AppLovin admits the merger proposition is a long shot. Foroughi said:

Let's be clear: this is a long shot. But building one of the world's best advertising AI models was also a long shot, yet we did it. We're not here for small bets. Our goal is to build a massive business that creates value for the world and our shareholders.

Investors should be pleased with the company's latest results and the sale of its gaming division. The company is focused on its expanding its ad business and, without or without a TikTok deal, AppLovin appears to be on the right track.

Don’t miss this second chance at a potentially lucrative opportunity

Ever feel like you missed the boat in buying the most successful stocks? Then you’ll want to hear this.

On rare occasions, our expert team of analysts issues a “Double Down” stock recommendation for companies that they think are about to pop. If you’re worried you’ve already missed your chance to invest, now is the best time to buy before it’s too late. And the numbers speak for themselves:

• Nvidia: if you invested $1,000 when we doubled down in 2009, you’d have $303,566!*
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Right now, we’re issuing “Double Down” alerts for three incredible companies, available when you join Stock Advisor, and there may not be another chance like this anytime soon.

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Chris Neiger has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends AppLovin. The Motley Fool has a disclosure policy.

Shares of Fastly (NYSE: FSLY), an edge-computing specialist, rose rapidly today after the company reported first-quarter sales and earnings that outpaced Wall Street's consensus estimates. A handful of analysts raised their price targets for Fastly stock as a result, boosting investor sentiment further.

Shares were up by 23.5% as of 1:50 p.m. ET on Thursday.

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Image source: Getty Images.

A solid start to 2025

Fastly reported revenue of $144.5 million in the first quarter, up 8% from the year-ago quarter and ahead of analysts' consensus estimate of $138.2 million. The company's adjusted loss of $0.05 per share was worse than its loss of $0.04 in the year-ago quarter, but still beat Wall Street's consensus estimate of a loss of $0.06.

CEO Todd Nightingale said in prepared remarks, "Fastly outperformed our revenue and operating-loss guidance in the first quarter, delivering positive free cash flow." The company had $8.2 million of free cash flow at the end of the quarter.

In addition to the better-than-expected results, investors were also happy to see that the company raised its full-year revenue guidance to $590 million, up from its previous outlook of $580 million, both at the midpoint. Many companies have cut their outlook for the year or removed guidance amid tariff and economic uncertainty, so Fastly's raised guidance stands in contrast to the current trend.

The latest results prompted a Piper Sandler analyst to raise the stock's price target from $6 to $7, and a Morgan Stanley analyst raised the target from $7 to $8.

There's still a lot to prove

Fastly delivered solid results in the first quarter, but the company still has a lot to prove. Revenue growth needs to pick up substantially, and the company needs to continue reducing its losses and moving toward profitability before the stock can look compelling.

Despite the quarterly results, I wouldn't jump on the bandwagon for buying this stock until it's very clear that the company can grow sales at a healthy pace and its losses have narrowed significantly.

Should you invest $1,000 in Fastly right now?

Before you buy stock in Fastly, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Fastly 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 $623,103!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $717,471!*

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*Stock Advisor returns as of May 5, 2025

Chris Neiger has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Fastly. The Motley Fool has a disclosure policy.

Semiconductors are in everything from cars to computers, and many devices have far more than just one. President Trump recently said that tariffs on semiconductors are coming "in the very near future." That threat has sent tech companies scurrying to find solutions that will lessen the potential blow to their businesses.

New research from The Motley Fool shows that the U.S. is vastly intertwined with countries including China, Taiwan, Singapore, and many others in global semiconductor supply chains, which complicates any future chip tariffs. Here are two companies you should keep an eye on if semiconductor tariffs come to pass.

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1. Taiwan Semiconductor

Semiconductor-specific tariffs could deal a significant blow to Taiwan Semiconductor (NYSE: TSM), also known as TSMC. The company is the largest manufacturer of processors in the world -- making processors for Apple (NASDAQ: AAPL), Nvidia, and Qualcomm -- and makes an estimated 90% of the world's most advanced processors.

If the Trump administration were to enact tariffs on processors, it would likely increase the cost of production for TSMC and cause the company to raise prices for its customers, which in turn would cause prices to increase for the many products TSMC's chips are in.

In response to questions about tariffs on the company's first-quarter earnings call in mid-April, Taiwan Semiconductor CEO C.C. Wei said, "We understand there are uncertainties and risks from the potential impact of tariff policies. However, we have not seen any change in our customers' behavior so far. Therefore, we continue to expect our full year 2025 revenue to increase by close to mid-20s percent in U.S. dollar terms."

For now, TSMC has committed to investing $165 billion in the U.S. to increase chip production for customers. The company said on the call that the investment comes as demand for U.S. customers increases, but the result of having a new plant could also help offset potential tariff costs in the future.

Still, the company has acknowledged that the threat of new semiconductor tariffs could bring "uncertainties and risks," and that TSMC will have a clearer picture of any impact in the second quarter.

2. Apple

Apple is already feeling the effects of tariffs, with $900 million in additional costs in the most recent quarter because of current tariffs, and said that higher costs could be on the way. Some analysts think tariffs could eventually cost Apple more than double what it already has in each quarter.

And that's before any semiconductor tariffs. If those come soon, then the pain will likely be ratcheted up as Apple receives chips from Taiwan, South Korea, Japan, and Singapore. Those chips then go into the company's phones, computers, tablets, smartwatches, and AirPods.

Tariffs on processors could cause the price of an iPhone to go up so that Apple can maintain the high margins it typically receives from its products. It might also take on some of the cost itself to offset the impact on consumers.

While there's still plenty of uncertainty around tariffs, Apple appears to be planning for any potential impact from chip tariffs by sourcing more semiconductors from U.S. plants. CEO Tim Cook said on Apple's recent earnings call, "During calendar year 2025, we expect to source more than 19 billion chips from a dozen states, including tens of millions of advanced chips being made in Arizona this year."

Apple also committed to spending $500 billion in the U.S. over the next four years, part of which will go to expanding TSMC's semiconductor manufacturing in Arizona.

But don't get your hopes up just yet for Apple. Cook also said on the earnings call, "I don't want to predict the future because I'm not sure what will happen with tariffs." He added that he's having a difficult time seeing beyond June.

A lot of uncertainty right now

Both of these companies are tech leaders in their respective markets, but each faces a lot of tariff uncertainty right now. Keep that in mind if you're considering buying Taiwan Semiconductor or Apple.

The tariff situation doesn't mean investors should avoid these stocks entirely, but it might be a good idea to take a wait-and-see approach with both if you're considering buying right now.

Should you invest $1,000 in Taiwan Semiconductor Manufacturing right now?

Before you buy stock in Taiwan Semiconductor Manufacturing, consider this:

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Chris Neiger has positions in Apple. The Motley Fool has positions in and recommends Apple, Nvidia, Qualcomm, and Taiwan Semiconductor Manufacturing. The Motley Fool has a disclosure policy.

Tesla (NASDAQ: TSLA) has been talking about a cheaper EV for years, but it has always been just out of reach, and plans to build one have continually changed. But the company recently gave some updates about its progress on releasing a more affordable EV, even if details are still sparse.

Here are three things we know about Tesla's upcoming lower-priced EV and what it may mean for the company after it is launched.

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Image source: Tesla.

1. The new model could just be a stripped-down version of a current model

Last year, Tesla reportedly axed plans for what some were calling the Model 2. But the rumors of a cheaper model never quite went away.

Tesla confirmed its plans for a cheaper EV to debut soon when management said in prepared remarks: "As guided, switchover of production lines for the New Model Y resulted in several weeks of lost production. During the switchover, we also prepared our factories for the launch of new models later this year."

On the company's recent first-quarter earnings call, Tesla's vice president for vehicle engineering, Lars Moravy, said, "And so the models that come out in the next months will be built on our lines and will resemble in form and shape, the cars we currently make."

There are two things to note here. The first is that there are two references to "models," meaning more than one. While there aren't many specifics on one affordable Tesla, let alone two, it's still unclear exactly what it means.

Since the production line updates for the refreshed Model Y and preparation for the launch of new models happened at the same time, it's widely believed the new model (or models) will be based on the Model Y and potentially the Model 3.

2. Tesla says the model will be "affordable"

In its first-quarter results, the company said, "Given economic uncertainty resulting from changing trade policy, more affordable options are as critical as ever."

Moravy said on the earnings call that "[T]he key is that they will be affordable and you'll be able to buy one."

So, the price will be...affordable.

Tesla's previously rumored cheaper model was expected to cost $30,000 after EV tax credits. That estimate was before President Donald Trump's tariffs that could cause price increases for core EV components, including batteries.

While the Trump administration scaled back some automotive tariffs recently, there's still significant uncertainty around how automakers will be affected.

Any tariffs on auto parts, batteries, semiconductors, sheet metal, or the various other components in a vehicle could cause Tesla to raise prices for its current lineup. If so, an "affordable" model with a goal of $30,000, after incentives, may be harder to pull off than before.

3. Production will begin in June

One detail that management made clear on the call is that production of the model will start in June 2025. Chief financial officer Vaibhav Taneja said: "We think our strategy of providing the best product at a competitive price is going to be a winner, and this is the reason we're still focused on bringing cheaper models to market soon. The start of production is still planned for June."

Tesla's management told analysts on the call that the ramp up for new vehicle production "might be a little slower" than the company expected initially, given the "turmoil in the industry right now."

Still, June production is the target, and even a slow rollout of an affordable Tesla is better than no rollout of an affordable vehicle.

Will the new model be too little, too late?

A lower-priced model is a smart move. The average transaction price for a new Tesla is now more than $54,500, so a $30,000 price tag could help the company attract more budget-conscious buyers who previously couldn't afford one of its EVs.

But I think the timing of the new model is unfortunate. First, while the company may be less affected by automotive tariffs than some automakers, it's not immune. Any price increases in materials, electronic components, or other auto parts could make it difficult to earn a significant profit margin on its affordable model. With Tesla's net income falling 71% in the first quarter, it needs its vehicles to be as profitable as possible.

The company doesn't have control over what the Trump administration decides to do with tariffs. But Elon Musk's involvement in running the Department of Government Efficiency (DOGE) and his subsequent distraction from running Tesla have caused damage to the company's brand.

Musk said recently that he's scaling back his time at DOGE to one or two days per week, but I think some of the damage has already been done. Tesla can rebuild its reputation over time, but it probably won't be able to do so by the time a more affordable model is launched.

That means the new model will debut with the backdrop of tariffs, an uncertain economy, and a brand that's suffering. That's not exactly a recipe for success for a new product.

While I think a cheaper EV will be a positive move for Tesla, I don't think it makes the stock a buy right now. Investors should wait to see how well the vehicle sells and if its lower price attracts new customers. For now, it's probably best to take a wait-and-see approach rather than buy shares before the vehicle is launched.

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Two popular stocks among tech investors lately are Rigetti Computing (NASDAQ: RGTI), which makes quantum computing hardware and software, and the semiconductor company Nvidia (NASDAQ: NVDA). While Nvidia is a much more direct bet on the booming artificial intelligence (AI) market, Rigetti's quantum computing systems are integrated into some existing AI.

Both stocks have soared, too, with Rigetti up 34% and Nvidia skyrocketing 342% over the past three years, compared to the S&P 500's 15% rise. But, which is the better AI stock for long-term investors? Let's take a look.

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What's happening with Nvidia?

If you're in the market for an AI stock, it's hard to beat Nvidia. All major global tech companies have ramped up their data center spending over the past few years as they compete for artificial intelligence dominance.

That's led to a bonanza of data center spending and rising demand for the processors in them. The result has been a boon for Nvidia's chip sales. Revenue from its data center segment soared 142% in fiscal 2025 to $115 billion, and the company's non-GAAP earnings soared 130% to $2.99 per share.

It's also given Nvidia a massive lead in the AI data center processing space, with an estimated 70% to 95% market share. And the AI boom isn't over yet. Nvidia CEO Jensen Huang thinks tech companies will invest $2 trillion in AI data center spending over the next few years, which could lead to even more demand for Nvidia's advanced processors.

The company is well-positioned to benefit from its latest AI processor, Blackwell, which has already spurred strong demand from tech giants and resulted in $11 billion in sales, the company's "fastest product ramp."

What's happening with Rigetti?

Quantum computing offers investors a compelling opportunity because the ramifications of the technology could advance everything from materials science to disease prevention and climate science. Unlike traditional computers, which process bits as either 0s or 1s, quantum computers use qubits, which can be either 0 or 1, or both simultaneously.

That allows them to scale hypothetical scenarios much faster than traditional computers, although sometimes at the cost of making more mistakes. Rigetti makes hardware, software, and quantum cloud computing systems that tap into the massive potential of this market, which could be worth $170 billion by 2040.

Rigetti's comprehensive approach to quantum computing is attractive to investors. It also partnered with some heavy hitters in the cloud space, including Amazon and Microsoft, giving Rigetti's tech real-world credibility (as opposed to theoretical applications that are often associated with quantum computing).

But despite all of the interest in Rigetti, the company's recent financial results weren't impressive, considering sales fell 32% in the fourth quarter to just $2.3 million. That's not a good look for a young quantum computing company that's trying to carve out a niche in a speculative, new market.

Rigetti's share price has soared 639% over the past year, giving its stock an expensive price-to-sales ratio of 147. Investors are now paying a premium for a company whose sales are falling and that's betting on an unproven market.

The verdict: Nvidia is the better AI stock

There's no getting around the fact that all stocks are facing some uncertainty right now. President Trump's tariffs have left the market reeling, and many companies are scrambling to adjust to potential changes. Investors should be more cautious than in the recent past about the potential growth for any company, including Nvidia and Rigetti.

But if you're looking for the better AI stock right now, Nvidia is it. Even if an economic slowdown arises from tariffs, Nvidia has a strong lead in the AI processor market, and tech giants are still clamoring for its chips. AI spending could slow a bit during a downturn, but the spigots won't likely turn off. Tech giants have too much at stake in their race for AI dominance to slow spending too much.

As for Rigetti, I think the stock is simply too speculative. Sure, quantum computing holds a lot of promise, but it could still be years before most companies have real-world uses for the tech. Meanwhile, Rigetti's revenue is tumbling when it should be rising quickly, and its stock is expensive. All of which means it's probably best to leave Rigetti's shares alone right now.

Don’t miss this second chance at a potentially lucrative opportunity

Ever feel like you missed the boat in buying the most successful stocks? Then you’ll want to hear this.

On rare occasions, our expert team of analysts issues a “Double Down” stock recommendation for companies that they think are about to pop. If you’re worried you’ve already missed your chance to invest, now is the best time to buy before it’s too late. And the numbers speak for themselves:

• Nvidia: if you invested $1,000 when we doubled down in 2009, you’d have $287,877!*
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*Stock Advisor returns as of April 21, 2025

Chris Neiger has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Nvidia. The Motley Fool has a disclosure policy.

Shares of the online housing brokerage Opendoor Technologies (NASDAQ: OPEN) plunged 23% this week, according to data compiled by S&P Global Market Intelligence, after the latest data showed that housing sales slowed to their lowest pace since 2009.

Housing inventory climbed quickly, but sales slowed as potential homebuyers shunned high prices, elevated interest rates, and economic uncertainty. With an unpredictable macroeconomic climate, investors are concerned that more pain could be ahead for the housing market and Opendoor.

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A cooling climate

The housing market showed its first dramatic signs of slowing down in March, with existing-home sales dropping 5.9% during the month compared to February. The monthly drop also represented a 2.4% decline year over year, according to data from Realtor.com.

Mortgage rates have fluctuated over the past month since President Trump announced aggressive tariffs on U.S. trading partners. But despite some temporary dips, they're still elevated, sitting at around 6.8% for a 30-year mortgage.

While not historically high, mortgage rates are much higher than they were a few years ago, and they've remained stubborn during a historic rise in housing prices. For example, the median home sales price has spiked nearly 27% over the past five years to $416,900.

These rapidly accelerating home prices were fine when buyers felt more confident in the economy and their jobs, but that's changed recently. A recent survey found that consumer confidence in where the economy is headed is at a 12-year low.

All of this is bad news for Opendoor, whose platform connects buyers and sellers. Opendoor also buys, flips, and sells homes, so the slowdown in homebuying is likely to hurt the business. Opendoor's revenue fell 26% in 2024 to $5.2 billion, and its net loss widened to $392 million. Those figures were reported before the latest housing data, meaning Opendoor could face further downward pressure.

Not a great trajectory

With sales falling in 2024 and losses widening, Opendoor was already struggling. However, the latest housing market data indicates that tougher times could come.

Even if Trump's tariffs don't spur a recession, it's evident that with consumers worried about their jobs and about price increases on goods due to tariffs, they're holding off on house purchases. And with no end in sight to the tariff uncertainty, Opendoor may continue to be affected by this negative homebuyer sentiment.

Should you invest $1,000 in Opendoor Technologies right now?

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*Stock Advisor returns as of April 21, 2025

Chris Neiger has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

President Trump's recent rollout of tariffs has caused chaos in the stock market and plenty of uncertainty among business leaders who are trying to map out the long-term strategy for their companies.

Some investors are looking for any signs that the Trump administration may take a softer approach to the industry. That's why it wasn't surprising to see investors jump on Trump's comments recently when he said he wants to "help some of the car companies" amid his 25% auto tariffs.

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Both Ford's (NYSE: F) and General Motors' stocks popped on that comment, with Ford's share price rising about 4% the same day Trump made his comments. However, buying Ford stock based on the shifting sentiment from the president is a terrible strategy. Here's why.

Image source: Ford.

Trump could change his mind

One reason why it's not a good idea to buy Ford or other auto stocks based on one comment is that President Trump could simply change his mind.

Earlier this month, the Trump administration announced, and then subsequently walked back, some of the harshest tariffs on most countries in only about 24 hours. Imports from China, however, are still at a staggering 145%.

If you're banking on the administration giving Ford (or other domestic automakers) a permanent reprieve on tariffs, you're essentially gambling with your money. President Trump could just as easily renege on his comments to help the automakers as quickly as he slapped steep tariffs on auto imports.

Even if the administration puts a permanent pause on some tariffs, there's no certainty they'll remain in place or for how long. It has become increasingly difficult to know which direction the administration is going on tariffs, and the constant shift means that buying stocks based on one comment is likely a terrible idea.

Even if auto tariffs temporarily go away, economic damage could already be done

President Trump's auto tariff goals seem to be focused on bringing automotive manufacturing back to the U.S., but the costs of doing so for Ford and other domestic automakers are tremendously high.

About 17% of Ford's North American production occurs in Mexico and Canada. If auto tariffs stay in place, the cost of new and used vehicles could increase by an average of 13.5%. But even if automotive tariffs disappear tomorrow, other substantial tariffs are in place, including 10% for most countries and 145% for China. While some new trade deals will be made, many economists and CEOs believe there will be substantial economic pain ahead.

A recent Wall Street Journal survey of economists put the risk of a recession at 45% over the next year. And more than half of CEOs in a separate survey think one is coming in the next six months.

History shows that Americans do not open their wallets for car purchases when the economy is doing poorly. During the Great Recession, new vehicle sales fell by 40% in just 12 months -- equal to $107 billion in sales declines. That doesn't mean they'll fall by that much again if a slowdown occurs, but it does show that when Americans are worried about their finances, they don't go out and buy new cars.

And Americans are worried about their finances. A recent CNBC survey found that 70% of Americans are stressed about personal finances, with the top-cited reasons being inflation, interest rates, and tariffs.

All of this adds up to a bad time to buy Ford

There is significant uncertainty among Ford, automakers, and the economy in general. There's no guarantee a recession is around the corner, but if a slowdown occurs because of tariffs, it could put a significant strain on Ford. The company's CEO, Jim Farley, said earlier this year:

"Let's be real honest: Long term, a 25% tariff across the Mexico and Canada borders would blow a hole in the U.S. industry that we've never seen."

There's also no guarantee that "help" from the Trump administration will fix Ford's predicament. Even if auto tariffs go away, the U.S. will be engaged in a trade war with China and still have significant tariffs against other trade partners that could slow the economy.

Instead of buying Ford or other stocks based on the hope that the company will eventually be immunized from the tariffs, it's probably best to sit this stock out until the dust settles and more concrete information is in place to make a wise decision.

Should you invest $1,000 in Ford Motor Company right now?

Before you buy stock in Ford Motor Company, consider this:

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*Stock Advisor returns as of April 21, 2025

Chris Neiger has no position in any of the stocks mentioned. The Motley Fool recommends General Motors. The Motley Fool has a disclosure policy.

Shares of e-commerce giant Amazon (NASDAQ: AMZN) spiked today on news that President Donald Trump's administration is willing to ratchet down its trade war with China. Specifically, The Wall Street Journal is reporting the administration may cut import tariff on goods from China by more than half.

Treasury Secretary Scott Bessent's comments today that there "will be a de-escalation" between China and the U.S. also helped send stocks soaring.

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Amazon stock was up by roughly 5% as of 12:45 p.m. ET.

145% tariffs no more?

While nothing has been formally announced, WSJ reported that a senior White House official said that the Trump administration is likely to reduce China tariffs to between 50% and 65%. The potential shift in tariffs may also include a tiered system in which some imports that aren't considered a threat to national security would receive a lower tariff.

This comes after Trump said yesterday that the 145% tariffs on China are "very high" and that they won't stay that high, adding that they would come down "substantially." Bessent echoed Trump's sentiment today in a keynote address, saying that China and the U.S. have an opportunity "for a big deal."

In 2024, about 70% of the products sold on Amazon were made in China. Trump's 145% tariffs on Chinese imports could therefore severely impact Amazon's business, with many sellers likely to stop offering products on the platform while others significantly raising prices.

With the Trump administration indicating that it wants to find a way out of this trade war, investors are hoping Amazon's e-commerce business will benefit.

Less rhetoric; more deals

Investors will still have to wait and see what, if any, tariff deals are reached with China. Any wavering on Trump's part on trade negotiations could send Amazon's stock falling again. Still, it's good to see the administration seemingly wants to de-escalate its trade war with China.

The news comes on the heels of Trump saying yesterday that he has "no intention" of firing Federal Reserve Chairman Jerome Powell. Trump had previously indicated he wanted Powell to be fired because the Fed had decided to keep interest rates steady, instead of cutting them as Trump wants.

The legality of Trump's ability to fire Powell was in question, and investors were worried that trying to do so would cause even more volatility in the market and the economy.

Amazon investors should be happy that the administration appears to be cooling down its tariff threats against China and backing away from threats to the Fed. But it's worth keeping in mind that there's still a lot of tariff and economic uncertainty right now, which will likely lead to more market volatility in the near term.

Should you invest $1,000 in Amazon right now?

Before you buy stock in Amazon, consider this:

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*Stock Advisor returns as of April 21, 2025

John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Chris Neiger has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Amazon. The Motley Fool has a disclosure policy.

Rigetti Computing (NASDAQ: RGTI) has caught the eye of many tech investors over the past couple of years as the quantum computing market has taken shape. The company is knee-deep in this market, designing and manufacturing quantum computing units and systems, as well as running a quantum computing platform application development.

Quantum computing hardware and software could be a $170 billion market by 2040, and the enthusiasm around this space has caused Rigetti's share price to surge 588% over the past year. But despite those gains, the company isn't profitable, and sales tumbled 32% in the fourth quarter to $2.3 million.

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Rigetti's skyrocketing share price means the stock now has a price-to-sales ratio of 147. That's a staggering valuation, and coupled with the company's losses and falling sales, it's probably best for investors to look elsewhere. Here are two great tech companies to choose from, both tapping into another large tech trend: artificial intelligence.

Image source: Getty Images.

1. Taiwan Semiconductor

Taiwan Semiconductor (NYSE: TSM), also known as TSMC, is currently one of the most important artificial intelligence companies because it manufactures an estimated 90% of all advanced processors and is a critical production partner for AI leaders such as Nvidia.

Technology companies have gone all-in on an AI race, and many of them are spending hundreds of billions of dollars to build huge data centers that will serve as their artificial intelligence foundation for years to come. The ramp-up in spending resulted in TSMC's revenue rising 42% to $25.5 billion and earnings per American Depository Receipts (ADR) popping 60% to $2.12 in the first quarter (which ended March 31).

It's worth mentioning that there are some uncertainties around continued data center spending because of the recent tariff announcements, and TSMC could face potential issues if and when a specific semiconductor tariff is announced.

Still, no other company has such a strong position in AI chipmaking, and not many companies even have the technical capabilities to produce some of the most advanced processors the company makes. Even amid the backdrop of tariffs, Taiwan Semiconductor could still win over the long term, as tech companies are expected to spend an estimated $2 trillion on AI data centers over the next few years.

2. Microsoft

Microsoft (NASDAQ: MSFT) was an early mover in AI with its investment in ChatGPT creator OpenAI, and has since integrated the chatbot into many of its services under its Copilot brand. This has helped Microsoft stay on pace with other competitors in the AI software space and expand its potential in new areas like agentic AI.

AI agents, which can work on their own to complete tasks like online shopping or making reservations, could grow into a multitrillion-dollar market over the next few years.

Still, Microsoft's biggest AI opportunity comes from its strong position in cloud computing. Microsoft is the second-largest public cloud company after Amazon, with 21% of the market compared to 30% for its rival. Microsoft has closed that gap significantly over the past few years, as many developers and companies have chosen its Azure platform.

Azure's sales rose 31% in the company's second quarter (which ended Dec. 31), and that demand could increase in the coming years. Goldman Sachs estimates that AI cloud computing sales could reach $2 trillion by 2030.

Microsoft won't have to wait around to see the benefits of all these AI opportunities, either. The company's annual AI revenue run rate is now $13 billion, a massive 175% increase year-over-year. With Microsoft integrating one of the most advanced AI chatbots into its services and benefiting from the growth of AI cloud services, the company is well-positioned to tap into artificial intelligence for years to come.

Of course, as with buying any stock right now, investors should know that President Trump's tariffs will likely cause more uncertainty in the markets and could cause an economic slowdown. If you have many more years before retirement, you can likely ride out some of the short-term volatility with these companies, but investors closer to retirement may want to look for alternatives outside of the tech space for now.

Should you invest $1,000 in Taiwan Semiconductor Manufacturing right now?

Before you buy stock in Taiwan Semiconductor Manufacturing, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Taiwan Semiconductor Manufacturing 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 $561,046!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $606,106!*

Now, it’s worth noting Stock Advisor’s total average return is 811% — a market-crushing outperformance compared to 153% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

See the 10 stocks »

*Stock Advisor returns as of April 21, 2025

John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Chris Neiger has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Amazon, Goldman Sachs Group, Microsoft, Nvidia, and Taiwan Semiconductor Manufacturing. The Motley Fool recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy.

With stock prices all over the map right now, it's difficult to determine which companies might be good to invest in. When things are really uncertain, it's a good time to seek guidance from those who've weathered plenty of challenging times.

There's probably no one better in the investing world to turn to during these times than Warren Buffett. The billionaire investor and CEO of Berkshire Hathaway has amassed a $250 billion portfolio of stocks, and many of his picks have stood the test of time.

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If you're in the market for solid companies that could be great long-term picks, here are two no-brainer Buffett stocks to buy and hold.

Image source: Getty Images.

1. Amazon: The e-commerce and cloud computing leader

Some investors are currently skeptical about Amazon (NASDAQ: AMZN). Many of the company's e-commerce sellers are highly dependent on goods from China -- which is currently in a trade war with the U.S. -- and any economic slowdown could potentially slow Amazon's sales.

However, while those concerns aren't unfounded, they might also be a bit overblown. It's important to remember that Amazon holds 40% of the e-commerce market share in the U.S., while Walmart is far behind with just 7%. This dominance means that U.S. consumers are unlikely to drop Amazon and look elsewhere for their purchases, no matter what happens with the economy.

Similarly, any slowdown from tariff pressure will be felt across the entire retail sector. Walmart sells a lot of goods made internationally. Amazon isn't especially vulnerable, and when tariffs eventually subside (even if that takes a while), the company will still retain its leading e-commerce position.

Finally, as important as e-commerce is to Amazon, the company's cloud computing business, Amazon Web Services (AWS), is the real moneymaker. AWS accounted for 58% of the company's operating income last year, even though it made up just 17% of its sales.

AWS is the leading cloud computing service, with a 30% market share compared to Microsoft's 21%. Artificial intelligence is accelerating cloud sales across the globe and will likely continue to do so for years to come. Goldman Sachs estimates AI cloud revenue will reach $2 trillion in five years.

Even if the U.S. economy hits some rough patches soon, Amazon's strong position in e-commerce and its lead in cloud computing should help the company continue growing. That doesn't mean its stock won't dip in the short term, but as a five-year investment or longer, Amazon is still in good shape. As of the end of 2024, Berkshire Hathaway held 10 million shares of Amazon.

2. American Express: A classic Buffett stock that's still growing fast

Like Amazon, American Express (NYSE: AXP) won't be immune to a potential economic slowdown if one materializes. Americans' credit card debt is already at record highs, reaching $1.21 trillion at the end of 2024. Financial pressures could cause some cardholders to scale back on things like vacations and could cause some difficulties in making payments. Neither is good for the economy or American Express.

But it's worth remembering that most economic slowdowns are often short-lived -- recessions last 17 months on average -- and any pullback on spending could be temporary. American Express is still growing quickly and is in a good position to continue doing so.

The company's revenue rose 9% to $65.9 billion, and earnings per share (EPS) popped 25% to $14.01 in 2024. Management expects EPS to jump 14% and for sales to climb 9% this year, at the midpoint of guidance.

Part of the company's strength comes from the 13 million new cardholders it added last year, 70% of which are using American Express' "fee-paying products" that charge annual fees.

American Express has been a longtime holding of Buffett's, with the famed investor buying shares for the first time in 1991. Even as Buffett has trimmed other positions, American Express remains Berkshire's second-largest holding.

It's also worth noting that American Express' price-to-earnings multiple is currently 16.7, down from 20 this time last year, which means you can pick up shares at a relative discount right now.

I understand the hesitation some investors might have in buying a credit card stock ahead of a potentially difficult economic time. But a few years from now, it's more likely than not that owning this solid player in the credit card space was a good stock to add to your portfolio.

A key piece of Buffett's investing advice

Buffett once quipped, "​​We don't have to be smarter than the rest. We have to be more disciplined than the rest." Those are timely words of wisdom as investors respond to market turmoil and consider picking up shares of some of Buffett's stocks.

Should you invest $1,000 in Amazon right now?

Before you buy stock in Amazon, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks 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 $509,884!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $700,739!*

Now, it’s worth noting Stock Advisor’s total average return is 820% — a market-crushing outperformance compared to 158% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

See the 10 stocks »

*Stock Advisor returns as of April 10, 2025

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. Chris Neiger has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Amazon, Berkshire Hathaway, Goldman Sachs Group, Microsoft, and Walmart. The Motley Fool recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy.

The market is suffering under the weight of President Donald Trump's tariffs on trading partners, as investors try to understand how they'll affect companies.

One growth stock that's fallen hard this year is Amazon (NASDAQ: AMZN), which is down 20% year to date, as of this writing. That fall is causing some investors to wonder whether it might be a good time to pick up shares, or if it's best to avoid the company during this uncertain time.

Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. Learn More »

Here's why I think now could be a good time to buy Amazon stock.

Image source: Amazon.

One way it will get more difficult for Amazon

It's worth mentioning that Amazon isn't immune to the tariffs. Nearly 25% of the products sold on Amazon come from China. As of this writing, the U.S. has placed a 34% tariff on Chinese goods, on top of a 20% duty previously in place.

Amazon holds about 40% of the e-commerce market in the U.S., but it also has a substantial international footprint, with e-commerce marketplaces in more than 20 countries and shipping to more than 100 countries. So whether it's U.S. sellers that offer products made internationally or international sellers offering products in their own countries, Amazon's global marketplace is likely to be affected by the tariffs if they remain in place.

How Amazon's business may actually benefit

While prices of some goods will no doubt increase on Amazon's platform, the company could also benefit from a new executive order President Trump signed that removed a previous exemption. The de minimis exemption allowed inexpensive international goods to come into the country without U.S. Customs and Border Protection scrutiny and without tariffs.

That previous exemption helped cheap goods pour into the U.S. via China-based platforms Shein and Temu. Those platforms were able to undercut some of Amazon's prices, which led Amazon to launch its own lower-priced marketplace, Amazon Haul, to try to compete. With Shein and Temu no longer able to enjoy those benefits, Amazon could benefit from lower competition.

I think it's also important to point out that even during difficult economic times, and even amid high inflation, Amazon's marketplace has grown. In the first year of the COVID-19 pandemic, Amazon's sales increased 22%, and through the 2008 financial crisis, its revenue jumped 29%.

That doesn't mean the same will happen with tariffs in place, but it does show that Amazon has weathered difficult times in the past and come out ahead.

The secret of Amazon's growth

While Amazon is best known for its e-commerce platform, Amazon Web Services (AWS) is actually its most profitable segment. AWS generated $39.8 billion of operating income in 2024, compared to $25 billion from its North American e-commerce sales.

AWS holds a dominant 30% of the global cloud computing market share, compared to 21% for Microsoft and just 12% for Alphabet.

Cloud computing demand is on the rise, especially amid the development of artificial intelligence applications and more companies looking to add AI into their workflows. Goldman Sachs estimates that AI cloud revenue could reach $2 trillion by 2030, and Amazon, with its leading position, is perfectly positioned to benefit.

Amazon's trading at a discount, but expect more volatility

With Amazon's recent share price dip, the company's forward price-to-earnings multiple is about 26, down from about 42 this time last year. That means the stock is relatively cheaper than it was about a year ago, giving investors a chance to grab shares at a discount.

It's important to note that the tariff uncertainty will likely continue to cause volatility in the market. If there's a reversal on tariffs or significant trade deals are made, stock prices could surge higher. But even if the tariffs remain in place, Amazon's dominance in e-commerce and its long-term prospects in cloud computing still make it a great stock to own for the long term.

Don’t miss this second chance at a potentially lucrative opportunity

Ever feel like you missed the boat in buying the most successful stocks? Then you’ll want to hear this.

On rare occasions, our expert team of analysts issues a “Double Down” stock recommendation for companies that they think are about to pop. If you’re worried you’ve already missed your chance to invest, now is the best time to buy before it’s too late. And the numbers speak for themselves:

• Nvidia: if you invested $1,000 when we doubled down in 2009, you’d have $249,730!*
• Apple: if you invested $1,000 when we doubled down in 2008, you’d have $32,689!*
• Netflix: if you invested $1,000 when we doubled down in 2004, you’d have $469,399!*

Right now, we’re issuing “Double Down” alerts for three incredible companies, and there may not be another chance like this anytime soon.

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*Stock Advisor returns as of April 5, 2025

Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Chris Neiger has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Alphabet, Amazon, Goldman Sachs Group, and Microsoft. The Motley Fool recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy.