Money & Megatrends

October 31, 2025

By Brian Hunt

 

Inside today’s issue:

• One of the world’s greatest trading strategies says buy this sector… the great Steve Sjuggerud would agree
• Quanta Services surges to a new high, confirming the EPC megatrend thesis
• This is why you should never fall in love with a trend
• The robotics megatrend continues to create wealth and winners

 

One of the World’s Greatest Trading Strategies Says Buy This Sector — The Great Steve Sjuggerud Would Agree

 

I often say that I could profitably trade stocks for the rest of my life by going long established market trends that the public is either indifferent to or hostile towards. It’s literally all I need to generate substantial returns.

This strategy is so effective and so broadly applicable across all asset markets that it is the Swiss Army Knife of trading. It works in every market.

There are multiple reasons why this is the case.

One, market trends tend to persist, and winners tend to keep on winning. This is one of the “Iron Laws” of business, markets, and life.

It takes an enormous amount of time, energy, and investment to get a big trend up and running. This goes for technological, business, and macroeconomic trends. Once trends achieve critical mass and develop momentum, they become like big snowballs rolling down a hill… gathering mass and steam in self-reinforcing cycles that last for years.

The second reason why owning an ignored and trending market is so effective is related to valuation. An ignored market is usually a relatively cheap market… and will often offer high potential upside.

When the public is indifferent about a market, that market will not be bid up to expensive levels. This means the trend could run higher for years. Plus, some of the money on the sidelines could eventually pile into the market and drive prices higher.

My greatest investing “coach” — Steve Sjuggerud (pronounced “sugar-rude”) — was a master practitioner of this concept. He loved to find assets he said were “cheap, hated, and in an uptrend.” Following this powerful strategy, Steve built an extraordinary track record and reputation.

This morning, I thought of Steve and “cheap, hated uptrends” while looking at the oil and gas sector. Right now, the average investor couldn’t care less about oil and gas stocks. This makes it the cheapest major sector in the market.

Yet… look at the chart below. It’s a thing of beauty. It shows the price trend of the Energy Select Sector SPDR Fund (XLE) since mid-2022. XLE is one of the world’s largest ETFs. It owns oil and gas giants such as ExxonMobil (XOM), Chevron (CVX), and ConocoPhillips (COP).

As you can see, this industry that the public ignores is in a steady uptrend. It’s a series of higher highs and higher lows. Lower left to upper right.

This uptrend is not exciting enough for the public; it just works. I expect this trend to persist.

 

 

In September, analysts at Citigroup estimated that AI-related infrastructure spending will exceed $2.8 trillion through 2029.

In other words, the world’s largest tech companies – Google (GOOG), Microsoft (MSFT), Amazon (AMZN), and Meta (META) – are placing giant bets on AI… and driving the largest capex spending boom in history.

Regular readers know this megatrend is great for selected EPC companies.

But don’t take our word for it. Take the market’s word. This week, EPC giant Quanta Services (PWR) set a new all-time high.

EPC stands for Engineering, Procurement, and Construction. These firms design and build large-scale infrastructure projects, including airports, skyscrapers, power plants, subways, and data centers.

Business and political leaders believe the U.S. is in a “Great AI Race” against China. This race makes it urgent to build data centers and the electric infrastructure required to operate them.

The bidding process for many building projects will consist of EPC companies throwing out absurdly high $100 million+ bids… then Big Tech replying, “Sure, we’ll take five of them. Can you start yesterday?”

I’ve named Quanta as one company that is set to benefit from these circumstances.

Quanta is America’s largest publicly traded EPC company. It generates much of its revenue building the transmission lines, power connections, and electrical substations that the AI spending boom requires. Thanks to the AI boom, Quanta has market-leading earnings growth and share price momentum.

This week, Quanta climbed 6% to reach a new all-time high. The AI-powered EPC theme is off and running.

 

 

 

We spend the bulk of our time and attention on trends running higher and creating wealth. But it’s also good to know what market trends are working against shareholders.

As I noted in my megatrends book:

Too often in life, smart, hardworking people struggle to get what they want. It’s often because they’re not working with megatrend tailwinds at their backs, or worse, headwinds blowing in their faces. For example, you could have been one of the world’s best physical bookstore operators in 2005 and still gotten killed by the emergence of Amazon’s online book business.

With this in mind, let’s look at the brutal downtrend in the alcoholic drinks business. Over the past 10 years, alcohol consumption in America has declined substantially.

This is thanks to a variety of factors, most notably new research that claims to show even moderate alcohol consumption is harmful for your health. Poll firm Gallup reported this year that a record high percentage of adults believe moderate drinking is harmful for their health.

The debate over alcohol’s health risks still rages, but the stock market has made up its mind. Declining drinking rates have led to weak alcohol sales, which have led to sinking stock prices. The market value of alcohol giant Diageo (DEO) has declined by 36% over the past two years. The market value of beer giant Sam Adams (SAM) has decreased by 44% over the same period.

Shares of spirits and beer maker Constellation Brands (STZ) are down 42% over the past two years and hit a multi-year new low this week.

Alcohol stocks used to be among the market’s most reliable generators of cash flow and shareholder returns. Now, their products and stocks are deeply out of favor. It’s a good reminder to never fall in love with a trend. It won’t love you back. And things can change.

 

 

• Keep an eye on Tesla (TSLA) next week. Tesla watchers are hoping next week’s shareholder meeting (on Thursday) holds a blockbuster announcement regarding the company’s Optimus robot project. The stock is very close to an all-time high.
• Robotics leader Teradyne (TER) reached a new all-time high today. The robotics trend continues to generate wealth and winners.
• AI poster child Palantir (PLTR) reached a new all-time high today. The defense firm is up 1,227% over the past two years. It’s more confirmation that right now, you can make money in stocks faster than at any time in history.
• So far, Amazon (AMZN) is one of the big winners of earnings season. Last night, Amazon reported terrific quarterly growth. The stock popped 10% higher today to reach a new all-time high. This is a big point in favor of the technology megatrend.

 

Regards – and remember – trends tend to persist.

Brian Hunt