March 20, 2026

In the Loop – March 20, 2026

“In The Loop” is designed to give you a short update reflecting major developments, earnings, and investment trends across some core Equity Income and Growth holdings. All clients should be aware that individual buy/sell recommendations will be conveyed directly to you on an individual basis. Have a great weekend.

“The person that turns over the most rocks wins the game. And that’s always been my investing philosophy.”

- Peter Lynch

Before I get into the weeds, I want to remind all long-term investors that since 1980, the average annual drawdown in the S&P 500 is -14% while the average annual return has been +11%. Therefore, even during noisy markets, it has paid to remain focused on the long-term results. This does not mean investors should put their head in the sand. Quite the opposite. Periods like this usually provide great opportunities for patient investors who do not panic.

This week’s market is being driven by a single dominant force: an energy shock from geopolitical conflict, which is now cascading into inflation risk, delayed Fed easing, and rising concerns about global growth. Yes, there are plenty of rocks to turn over.

Iran War and the Oil Shock

Markets care so much about the price of Oil because it is the fastest transmission channel to inflation. It directly impacts transportation, chemicals and plastics. A silent threat that we outlined last week was the impact on chemicals. This layer of the global supply chain is very fragile. To give you an example, a key Japanese PVC producer has already cut output because of ethylene feedstock constraints and therefore plan on increasing PVC prices 20% beginning April 1. The longer the Strait of Hormuz stays closed, the more of these stories we will begin to uncover.

Federal Reserve March Meeting

The Federal Reserve held interest rates steady at 3.50%–3.75% for the second consecutive meeting, signaling a continued “wait-and-see” stance as economic uncertainty rises. The Fed is firmly in a data-dependent holding pattern—balancing sticky inflation (now influenced by energy/geopolitics) against a gradually cooling labor market. For markets, this translates into a “higher for longer”, with limited near-term easing unless inflation clearly trends lower. Futures markets are pricing in one cut for 2026.

Cyber Security

The White House just released President Trump’s National Cyber Strategy for America.

The March 2026 strategy signals a fundamentally more aggressive posture in cyberspace — offensive and defensive — and has real implications for government contractors, critical infrastructure operators, and technology companies. The four pillars include: Shape Adversary Behavior, Common Sense Regulation, Modernize and Secure Federal Networks and Secure Critical Infrastructure. What does this mean in practice: For organizations in critical infrastructure, defense, and government contracting — this strategy creates urgency around supply chain security, vendor risk management, and AI-ready cyber defenses. There will be investment opportunities within this space.

Individual Company Updates

CrowdStrike (CRWD)

CrowdStrike continues to expand its leadership in AI-native cybersecurity through new strategic partnerships and product integrations. The company recently partnered with Perplexity AI to integrate its Falcon platform into enterprise AI workflows, delivering real-time threat detection and data protection directly within AI-driven environments. In addition, CrowdStrike announced a collaboration with Nebius AI Cloud to secure AI infrastructure built on NVIDIA-powered systems, further embedding its platform into next-generation computing environments. These developments come as AI-driven cyber threats are accelerating, with reported attacks rising sharply year over year, reinforcing demand for advanced endpoint and cloud security solutions. Reflecting this strength, Morgan Stanley upgraded the stock to Buy and raised its price target, citing CrowdStrike’s leadership position, expanding platform adoption, and long-term growth potential despite its premium valuation.

Palo Alto Networks (PANW)

Palo Alto Networks continues to benefit from rising global demand for advanced cybersecurity solutions as governments and enterprises respond to escalating cyber threats. Recent U.S. policy initiatives aimed at combating cybercrime and protecting critical infrastructure are expected to drive increased investment in endpoint protection, threat intelligence, and AI-driven security platforms—areas where Palo Alto maintains a strong competitive position. The company’s integrated platform strategy, combining network security, cloud protection, and AI-powered threat detection, positions it as a key beneficiary of the growing need to secure increasingly complex digital and AI-driven environments.

NVIDIA (NVDA)

NVIDIA’s annual GTC conference once again reinforced its position at the center of the global AI ecosystem, with CEO Jensen Huang unveiling a series of major technological and financial developments. Most notably, management now sees cumulative revenue from its Blackwell and Vera Rubin systems surpassing $1 trillion through 2027, doubling prior expectations and highlighting the scale of the AI infrastructure buildout. NVIDIA introduced its next-generation Vera Rubin platform—designed as a fully integrated “AI factory”—alongside new inference-focused chips and its future Feynman architecture, which aims to solve key bottlenecks in AI scalability. The company is also standardizing “AI factory” deployments and expanding partnerships with major cloud providers and enterprises, reinforcing its leadership across compute, networking, and software. Beyond technology, NVIDIA’s growing influence reflects the broader “geopolitics of GPUs,” where control of advanced AI compute is increasingly tied to economic and national security leadership.

Amazon (AMZN)

Amazon continues to expand its AI infrastructure capabilities through strategic partnerships and monetization initiatives. AWS recently announced a collaboration with Cerebras Systems to accelerate AI inference by combining Amazon’s Trainium chips and networking stack with Cerebras’ high-performance wafer-scale systems, aiming to deliver some of the fastest cloud-based AI processing available. At the same time, Amazon is enhancing its consumer monetization strategy by rebranding its ad-free Prime Video tier and increasing pricing, a move that analysts estimate could generate hundreds of millions in incremental annual revenue. Together, these developments highlight Amazon’s dual focus on scaling AI infrastructure while driving higher-margin revenue streams across its platform. AMZN is Evercore ISI #1 Large Cap Recommendation for 2026.

Alphabet (GOOGL)

Alphabet remains at the forefront of the AI race, with recent developments reinforcing its leadership in both foundational models and infrastructure. Reports indicate that competitors such as Meta Platforms are considering licensing Google’s Gemini AI, underscoring the strength of its technology. At the same time, demand for Google’s proprietary AI chips (TPUs) continues to accelerate, driven by their lower cost and efficiency advantages at scale. Developed in partnership with Broadcom and manufactured by Taiwan Semiconductor Manufacturing Company, these next-generation chips are expected to enter mass production soon, positioning Google as both a leading AI platform provider and a key infrastructure player in the global AI ecosystem.

Broadcom (AVGO)

Broadcom continues to deepen its role in AI infrastructure with the launch of new high-performance networking chips designed to handle the explosive growth in data movement within AI data centers. The company introduced its Taurus optical DSP chip and confirmed production ramp of its Tomahawk 6 Ethernet switch, which delivers industry-leading bandwidth for large-scale AI clusters. Together, these technologies enable faster, more efficient data transfer across increasingly complex AI systems, positioning Broadcom as a critical enabler of next-generation data-center architectures. As hyperscalers scale toward massive compute clusters, Broadcom’s integrated networking solutions are becoming essential to supporting the growing demands of AI workloads.

We remain focused on navigating market trends and positioning portfolios for long-term growth and resilience.
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Formidable Asset Management (“Massey Romans Capital”) is an investment adviser registered under the Investment Advisers Act of 1940. The information presented in the material is general in nature and is not designed to address your investment objectives, financial situation or particular needs. Prior to making any investment decision, you should assess, or seek advice from a professional regarding whether any particular transaction is relevant or appropriate to your individual circumstances. Although taken from reliable sources, the Firm cannot guarantee the accuracy of the information received from third parties.

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