Patient Capital Management is a Baltimore asset manager founded in 2020 by Samantha McLemore, CFA — Bill Miller's long-time co-manager (working together since 2002, running the flagship Opportunity Equity strategy since 2014). Continuing the Miller-school contrarian tradition, it practices "time arbitrage": exploiting behavioral mispricing to concentrate in controversial growth names (tech, healthcare, Bitcoin-related) at deep discounts to intrinsic value. Its site preserves Bill Miller's complete 1995-2022 market letters, alongside ongoing quarterly letters and webinars.
The author thinks the market is still in a 'growing on skepticism' phase, far from euphoric, so no panic. With rate cuts and faster earnings growth, stocks look cheaper than bonds, and AI / big tech still has room. Nvidia is the key pick: AI infrastructure is only 15% done, and 36 times next year's earnings is reasonable given 33% profit growth. The S&P 500 trades at 21 times earnings with 12% annual profit growth, beating long-term Treasuries (24 times, no growth). Overall, valuations and concentration are backed by fundamentals.
The author believes: the market remains in the "growing amid skepticism" stage, far from a euphoric phase; with rate cuts and accelerating earnings, equities are not expensive relative to bonds, and AI and large-cap tech still have room to run [Optimistic].
The author argues that the current market remains in what Templeton called the “grow on skepticism” phase, far from the “euphoria” stage.
The author cites Sir John Templeton's classic judgment: "Bull markets are born on pessimism, grow on skepticism, mature on optimism and die on euphoria." In other words: “Bull markets are born in pessimism, grow in skepticism, mature in optimism, and die in euphoria.” The author concedes that, except in extreme cases, identifying the cycle's position is “more art than science”; but after attending the Forbes SHOOK summit, his conviction that the market is “still far from euphoria” strengthened. Among the roughly 800 financial advisors on site, when asked whether their clients were overweight stocks and holding low cash, only about three raised their hands; the vast majority believed their clients were underweight stocks and had too much cash. The author views this contrast as evidence that sentiment is far from overheated.
The author believes that long-term stock returns are unrelated to which party holds power, and the market's long-term path remains “up and to the right.”
The article asserts that stock market returns are the same regardless of which party is in power; the future is uncertain, but the long-term market trend is upward.
The author judges that Fed rate cuts combined with accelerating earnings growth keep stocks looking cheap relative to bonds, without any “overvaluation.”
The original text first acknowledges that there are voices saying stocks are “too expensive,” but argues that stocks are still superior to bonds by comparison: long-term Treasuries trade at 24x with zero growth, while stocks trade at 21x and EPS is expected to post a CAGR of 12% through 2026. Based on these factors, stocks “do not yet look overvalued.” The comparison table is as follows:
| Asset | Valuation | Earnings Growth |
|---|---|---|
| Long-term U.S. Treasuries | 24x | No growth |
| Stocks (S&P 500) | 21x | EPS CAGR 12% (through 2026) |
The author believes that the more skepticism about Nvidia, the less it looks like a top; 36x next-year earnings against 33% growth is not expensive.
At the summit, the author heard a great deal of skepticism and concern about Nvidia, and he believes “that is not how a top forms.” Nvidia currently trades at 36x next year's earnings, with earnings expected to grow at a 33% CAGR through 2026; the broader market trades at 21x with 12% growth. Jensen Huang said AI infrastructure construction is only 15% complete, and inference demand will increase a billionfold. The author concludes: "Early and surly are not the setup for a top." In other words: “Early and restless is not the shape of a top.” Here, “early and surly” can be seen as a pun, a play on “early and surely” (early and certain), which the author uses to emphasize that the market is still in the early stage rather than at a top. Comparison table:
| Asset | Valuation (next-year earnings) | Earnings CAGR (through 2026) |
|---|---|---|
| Nvidia | 36x | 33% |
| S&P 500 | 21x | 12% |
The author believes that the weight concentration of the top ten S&P 500 companies is not a bubble, but is supported by free cash flow fundamentals.
Currently, the top ten S&P 500 companies account for 35% of the index's weight, and they contribute 30% of the S&P 500's total free cash flow. The author thereby argues that high valuations and high concentration are tied to “large and robust fundamentals.” The original text does not name these ten companies. Table:
| Metric | Share |
|---|---|
| Top ten share of index weight | 35% |
| Top ten contribution to free cash flow | 30% |
Overall, the author's inclination is: do not panic over market valuations or concentration; AI infrastructure and large-cap tech stocks still have room.
The article gives no specific buy or sell actions, but the author is clearly positive on Nvidia (though the direction is not explicitly stated). At the same time, a caveat is warranted: this is an opinion piece written from the perspective of a position-holder. The author uses valuation comparisons to argue that stocks are “not expensive,” which naturally carries an element of defending equity holdings. Readers should keep this bias in mind.
| Instrument | Direction | Author's Stance (One Sentence) | Key Data |
|---|---|---|---|
| Nvidia | Not stated | Clearly bullish; argues that the abundance of skepticism is precisely why this does not look like a top, and the current valuation is not excessive | 36x next-year earnings; earnings CAGR 33% (through 2026); AI infrastructure only 15% complete |
| S&P 500 | Not stated | Believes the index overall is not overvalued, is more attractive than bonds, and concentration has fundamental support | 21x valuation; EPS CAGR 12% (through 2026); top ten weight 35%, contributing 30% of free cash flow |
| Long-term U.S. Treasuries | Not stated | Used as a comparison; 24x valuation with zero growth, less attractive than equities | 24x valuation; no earnings growth |
| S&P 500 top ten companies | Not stated | Believes the high weight is not a bubble, backed by massive, robust free cash flow | 35% of index weight, contributing 30% of free cash flow |