June 12, 2026

In the Loop – June 12, 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 Hidden Winners of the Next IPO Cycle

Investors are understandably excited about the potential public offerings of several high-profile private technology companies, including SpaceX, Anthropic, and OpenAI. What may be less appreciated is that many of today’s largest publicly traded technology companies already own significant stakes in these businesses, creating an additional source of value for existing shareholders.

Alphabet

Alphabet may be one of the largest beneficiaries. The company owns a meaningful stake in SpaceX, which could become worth well over $100 billion when the space and satellite leader eventually enters public markets. Alphabet also holds a substantial ownership position in Anthropic, one of the world’s leading artificial intelligence labs. If Anthropic ultimately reaches a valuation approaching $1 trillion, Alphabet’s stake alone could represent hundreds of billions of dollars in value.

Amazon

Amazon is similarly positioned. Through early investments in Anthropic, Amazon has become one of the company’s largest strategic partners and shareholders. Beyond the potential appreciation of its equity investment, Amazon benefits from long-term cloud infrastructure agreements that make Anthropic a major customer of Amazon Web Services. In many ways, Amazon wins both as an investor and as the infrastructure provider powering future AI development.

Microsoft

Microsoft stands to benefit from OpenAI’s anticipated public debut. As OpenAI’s largest shareholder and strategic partner, Microsoft not only participates in the potential increase in valuation but also benefits from ongoing cloud revenue, enterprise adoption, and exclusive access to leading AI technologies. OpenAI’s success increasingly strengthens Microsoft’s broader ecosystem.

NVIDIA

NVIDIA also occupies a unique position. In addition to direct investments in several AI leaders, NVIDIA supplies the critical computing infrastructure powering many of these companies. Whether AI firms remain private or eventually go public, NVIDIA continues to benefit from growing demand for advanced chips, networking equipment, and AI systems.

The key takeaway is that investors do not necessarily need access to private markets to participate in the value being created by these emerging technology leaders. Many of the largest publicly traded technology companies already own significant stakes in tomorrow’s potential IPO winners while simultaneously providing the infrastructure, cloud services, and technology ecosystems that help those businesses grow.

As a result, shareholders of companies such as Alphabet, Amazon, Microsoft, and NVIDIA may benefit from multiple layers of value creation: appreciation in their core businesses, increasing demand for AI infrastructure, and potential gains from strategic ownership stakes in some of the most valuable private companies in the world.

In our view, this creates a powerful secondary investment theme. The next wave of technology IPOs may generate substantial headlines, but many of the biggest winners could already be sitting inside today’s public-market leaders.

Individual Company Updates

Eli Lilly (LLY)

Eli Lilly continues to solidify its leadership in the rapidly expanding obesity market. Recent Phase 3 data for retatrutide demonstrated industry-leading weight-loss results while also showing benefits across related conditions such as sleep apnea, osteoarthritis, and type 2 diabetes. Combined with the continued success of Zepbound and a growing portfolio of next-generation obesity therapies, Lilly is building one of the deepest metabolic health franchises in healthcare.

Beyond obesity, the company is expanding patient access through broader insurance coverage and consumer-focused initiatives while investing in future growth through AI-driven drug discovery, RNA-based therapies, and strategic partnerships. With a strong pipeline, expanding market opportunities, and continued execution, Lilly remains well positioned to benefit from what could become one of the largest pharmaceutical growth markets of the next decade.

CrowdStrike (CRWD)

CrowdStrike recently reported another strong quarter, with revenue, earnings, annual recurring revenue, and free cash flow all exceeding expectations. While the stock initially sold off following the report, the reaction appeared driven more by elevated investor expectations than any deterioration in the business. The company continues to generate strong customer demand, expanding platform adoption and industry-leading profitability.

Perhaps most importantly, CrowdStrike is emerging as a major beneficiary of the growing intersection between cybersecurity and artificial intelligence. Management highlighted accelerating demand for AI-powered security solutions, with its new AI Detection and Response platform experiencing rapid adoption. Additional growth across cloud security, identity protection, and next-generation security information and event management solutions continues to reinforce CrowdStrike’s position as a leading cybersecurity platform.

The long-term investment thesis remains intact. As enterprises deploy AI across their organizations, the need to secure those systems becomes increasingly critical. CrowdStrike’s expanding platform, strong recurring revenue base, and growing AI-security opportunity position the company to remain a key winner in the next phase of enterprise cybersecurity spending.

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.

The opinions expressed herein are those of the Firm and may not actually come to pass.