Shares of DRB-Hicom Bhd surged to a three-month high after delivering earnings well above expectations. The stock climbed as much as 8% to RM1.24, valuing the group at roughly RM2.4 billion. But beneath the headline beat, analyst opinions remain sharply divided. What Drove the Surprise According to Hong Leong Investment Bank : 4QFY2025 core PATAMI: ~RM136 million FY2025 core earnings: ~RM178 million Earnings came in at 189% of HLIB’s forecast Key drivers: Strong Proton vehicle sales Improved margins Land sales contribution Proton highlights: 19,800 units sold in January 2026 (record high) Over 100,000 bookings for Saga MC3 3,000+ deliveries of e.MAS 5 EV in January Consolidation of manufacturing at Tanjung Malim for cost efficiency Money Master Take This is a classic case of headline beat vs structural sustainability . 1️⃣ Proton Is Carrying the Story The turnaround narrative rests heavily on Proton. Sales momentum is strong EV adoption gaining traction Geely reg...
Wall Street has been aggressively selling software stocks on fears that artificial intelligence could disrupt traditional business models.
Retail investors are doing the opposite.
As institutional money exits, individual traders are stepping in at near-record levels.
The Setup
S&P Composite 1500 Software & Services Index has dropped almost 20% year-to-date.
Yet retail trading flows into software names are approaching record highs, according to JPMorgan Chase & Co. data.
Most popular retail picks:
Microsoft Corp.
ServiceNow Inc.
AppLovin Corp.
Meanwhile, AI concerns have pressured names like Salesforce Inc. and Adobe Inc..
Even Nvidia Corp. saw record retail dip-buying after its recent pullback.
Money Master Take
This isn’t just about “buying the dip.”
It’s about a clash between structural fear and tactical opportunity.
1️⃣ Retail Is Trading Price Action, Not AI Disruption Risk
Institutional selling is driven by:
Margin compression fears
AI replacing SaaS functions
Valuation reset in high-multiple names
Retail, however, is reacting to:
20% drawdowns
Oversold technical signals
Short-term rebound probability
Key Distinction: Retail is positioning for a bounce. Institutions are repricing long-term earnings durability.
2️⃣ AI Disruption Narrative Is Still Unclear
The “AI scare trade” intensified after warnings about:
Software bankruptcies
AI replacing workflow tools
Narrowing competitive moats
But current sell-offs appear broad and indiscriminate.
This creates:
Compression in high-quality names
Valuation entry points in cash-generative leaders
Not all software companies face equal disruption risk.
3️⃣ Short-Term Setup Favors Tactical Rebound
Multiple weeks of aggressive selling often produce:
Technical exhaustion
Short-covering rallies
Oversold reversals
Retail inflows of US$336 million in early trading indicate strong dip appetite.
Short-term bounce probability is elevated.
4️⃣ Longer-Term Risk Still Exists
Structural questions remain:
Will AI reduce seat-based SaaS pricing power?
Will margins compress permanently?
Are multiples resetting to lower long-term averages?
The uncertainty is not resolved.
Investor Framework
| Time Horizon | Risk | Opportunity |
|---|---|---|
| Short-term | Low technical support | Bounce potential |
| Medium-term | Earnings revision risk | Selective entry |
| Long-term | Business model disruption | Survivors gain share |
Bottom Line
Retail is aggressively buying the AI fear selloff.
Institutions are repricing long-term software economics.
A short-term rebound is increasingly likely.
Long-term stock selection will matter more than sector exposure.
This is no longer a simple “tech dip.” It’s a valuation reset in progress.
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