A new AI investment strategy that could generate 1,100%+ returns

Today’s issue in preview:

• A new AI investment strategy that could generate 1,100%+ returns

• This energy trend is producing winners day after day. Are you benefiting?

• Learn our Top Themes to buy now

This energy trend is producing winners day after day. Are you benefiting?

Credit: sefa ozel

As it turns out, being bullish on oil stocks was a good idea.

Last week, one of our top energy recommendations – Canadian oil giant Suncor Energy (SU) – climbed 3.8% to reach a new all-time high. The stock has returned 73.5% since our original bullish oil call back in September 2025.

Last September, I made the case for going long the emerging uptrend in oil and gas stocks: As the global economy grows, oil demand will remain solid. However, importantly, U.S. shale oil production growth appears to be peaking.

Flatlining supply from this region would remove a critical and reliable source of production growth that has been in place for more than a decade. Plus, oil was very cheap relative to gold and other assets, indicating good value.

With all that in mind, we’ve written frequently and bullishly about owning Suncor, ExxonMobil (XOM), the diversified State Street Energy Select Sector SPDR Fund (XLE), and oilfield service stocks like those in the SPDR S&P Oil & Gas Equipment & Services ETF (XES). The oil sector has been one of the true market leaders over the past year. Both XOM and XLE recently reached new all-time highs.

When I recommended oil and started trading it from the long side, I did not factor in the potential bullish driver of the Iran War. That’s been a “bonus” driver of gains in oil stocks. Sometimes, the dice rolls in your favor.

Although positive news related to the Iran War could emerge at any time and trigger a short-term correction in oil and oil stocks, the long-term picture remains bullish. I see three reasons why this is the case.

One: Critical oil infrastructure in the Middle East has been damaged. Oil flows will not return to pre-war levels for possibly over a year. This supports oil prices north of $80 per barrel, which in turn supports strong cash flows for oil and gas firms.

Two: Most countries maintain substantial above-ground “buffer” supplies of oil and refined petroleum products in the event of market disruptions such as the Iran War. Over the past six months, much of these buffer supplies have been depleted to compensate for the loss of Middle Eastern flows. They must be replenished.

The coming restocking of buffer supplies will support oil prices north of $80 per barrel… which, again, supports large cash flows for oil and gas firms.

Three: Although oil stocks have enjoyed a large run since our September call, they aren’t up much over the past ten years. Adjusted for dollar debasement over the past decade, key oil and gas ETFs are down significantly. This is not an aging bull market that has attracted too many fans and too much capital. It is the opposite of that.

Avid Money & Megatrends readers know that I like to know both the bull and bear cases for any trend… but I care a lot more about what the market thinks of those cases than anything else. You can be bullish on an industry or theme all you like, but if the market is going against you, then your bullish thesis isn’t worth much.

As for the bull case for oil stocks, the market is enthusiastically supporting it… especially for companies with safe, reliable “not Middle Eastern” asset bases like key Canadian oil sand firms Suncor, Canadian Natural Resources (CNQ), Cenovus Energy (CVE), plus Argentine oil firm YPF (YPF). Our guidance remains: Stay long oil stocks.

A new AI investment strategy that could generate 1,100%+ returns

Credit: imaginima

Since Jan. 1, 2024, the market value of AI-centric defense giant Palantir (PLTR) is up 1,117%. Last Friday, the stock reached a new all-time high.

This giant gain makes Palantir one of the top-performing stocks of the 2020s.

It’s also a demonstration of how powerful the strategy of owning “AI Applications Layer” winners can be.

This strategy – which we most recently detailed in our July 15 issue – is so powerful that it can change your life. Like an “add a zero to your net worth” kind of change.

For a refresher of this strategy, think about Apple, Amazon, Google, Facebook, Netflix, and YouTube for a moment.

These are among the largest and most successful businesses in history.

Their early investors made 10X returns and, in some cases, 100X+ returns.

And they all have one thing in common: They didn’t build the physical network of fiber optic lines, routers, servers, and switches that made up the internet.

Instead, they built the wonderful businesses on top of that revolutionary infrastructure.

They were the “applications” layer of the internet.

It’s important to understand the applications layer concept because we’re on the cusp of a historic boom in companies that don’t build critical AI “hard infrastructure” such as data centers and semiconductors…but instead build wonderful businesses on top of that infrastructure… just like Apple, Amazon, and Google did with the internet.

The revolutionary AI program ChatGPT was released to the public in late 2022. Since then, big tech firms have invested over $1 trillion in semiconductors, networking equipment, computer memory, physical data centers, and other components of AI infrastructure.

This infrastructure powers extraordinary AI models that become more capable and faster by the month.

Now that so much infrastructure has been installed, thousands of businesses can be built upon it… much like how Amazon, YouTube, and Netflix were built upon the internet.

I’m talking about AI-centric businesses that revolutionize how we develop medicines, how we educate, how we entertain ourselves, how we manufacture, how we shop, how we transfer and invest money, and much more.

The internet changed every industry and created many new ones. AI will do the same.

Investors who follow the Internet applications layer playbook into big AI applications layer winners stand to make giant returns. In fact, I’d say this theme is one of the best places to find 10X+ winners over the next decade.

Palantir is a very early leader in this field.

Palantir is a leading software company that helps its customers use AI to organize, analyze, and act on huge amounts of complex data.

Palantir’s major products include Gotham, used extensively by defense and intelligence agencies; Foundry, designed for commercial enterprises; and Artificial Intelligence Platform (AIP), which integrates advanced AI models into business workflows.

Palantir’s largest customer is the U.S. government. Palantir provides military and intelligence agencies with advanced software that integrates battlefield intelligence, satellite imagery, sensor data, and operational information. Its AI-powered platforms help commanders identify threats, track adversaries, plan missions, coordinate forces, and make decisions.

If you want to conduct war in an ultra-high-tech fashion, you work with Palantir.

To be clear, Palantir did not build any AI data centers. Nor did it develop one of the leading frontier AI models. Instead, it has built software that harnesses the power of models from companies such as OpenAI and runs on computing infrastructure provided by others.

In effect, Palantir has positioned itself as a critical bridge between the extraordinary capabilities of AI and the organizations that can put those capabilities to work.

Palantir’s early mastery of AI and data analytics has helped it generate extraordinary revenue growth over the past six years. In 2020, annual revenue came in at $1.09 billion. In 2025, revenue came in at $4.48 billion. Palantir expects 2026 revenue to grow by an incredible 82% this year to about $8.15 billion.

Given this blazing growth, it’s no wonder Palantir is up more than 10X since early 2024. This is the AI Applications Layer phenomenon at work.

The AI infrastructure buildout is far from over. But enough advanced models have been developed, and enough infrastructure is in place, to fuel an extraordinary next phase of the AI boom.

Innovative companies in the “AI Applications Layer” can now harness this technology to build great businesses with extraordinary growth potential. Palantir is just the beginning.

Market Notes

• Our 8th recommendation to own the Boomer healthcare trend is paying off. Biogen (BIIB) and AbbVie (ABBV) just hit new yearly highs.

• Our March 27th recommendation to own cybersecurity stocks is paying off well. Fortinet (FTNT), Okta (OKTA), Qualys (QLYS) and Dynatrace (DT) all hit new highs. OKTA is now up 160% in the last year alone.

• The Iran War and its constriction of oil and refined product supplies continues to work in favor of oil shipping firms. Industry leaders Frontline (FRO), Torm (TRMD) and Hafnia (HAFN) reached new one-year highs this week.

• Small Modular Reactor players Oklo (OKLO) and NuScale Power (SMR) both hit new yearly lows last week.

Regards,

Brian Hunt
Editor, Money & Megatrends

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