Time to Take Some Profits? 11/12/24
42:45 Share

I'm scot opener and you're listening to C N B C S halftime report, the podcast the most profitable hour of the trading day. We record this live weekdays at twelve eastern listen in welcome to the house .

and report and importing region in today or Scott open or front and center. This out of the committee is making some big moves as this record rally takes a breather. We're breaking down the trades straight ahead.

Joining me for the hour. We have stephany link, bilbo, t. Robb, sachin and brand talking ten. Let's get you to check on the market right now. Put up an under pressure, certainly seeing some more red than we've seen what in the last week or so since the election, we have the as that compose IT down about a quarter of the best of the major three s MPI hundred, down about one third of a percent, and the doub Jones international downed about six tens of percent. Rusal also taking a bit on the chill here today, the worst of those major averages. What do you think, Stephanie, is this sort of a bit of profit, taking a bit of a breather? Or is this just sort of a regular healthy market getting used to the fact that we don't have so much uncertainty?

Yeah, well, we were five percent last week, so there's that. So I think it's just a breather, honest. I actually think this is going to we are going to see the markets resume their strength seasonally.

November and december are very strong months. You have six point four trillion dollars of cash and money market funds. They have a lot of portfolio managers that are behind their benchMarks year to date.

And he only got two months left to actually make up for that. And you mentioned we we did remove a lot of uncertainty last week. A lot elections fed chin's stilus.

And you know, corny, the market doesn't like uncertainty. So we checked boxes on all three of these things. Now we are focused on the new administration, pro growth, deregulation, less government spend, which will be more than offset, I think, by higher business investments spend.

And so all of these things are really positive. Of course, we have to watch about tabs. Course, we have to watch about a little bit more inflation, but this one comes about when more at tune have us and GDP growth and inflation is making a come back terms of coming down and making progress.

And earnings, which is what I follow, which is what we all follow because the markets follow, earnings are actually running up about seven percent for the past quarter and revenue was at five percent and very healthy. And margins, most importantly in my mind, have been much Better than expected. So you passing that Operating leverage. So that's why I think people are going to make their shopping list like I and add two on any weakness. Fair enough.

You know, bill, I think is interesting. This bank of amErica fund manager survey was talking about what Stephanie is saying of all of these pause of growth factors, at least that's what we think. But then also the possibility of higher inflation. I mean, can you have both can you have sort of this record growth going forward that we believe we might have under this new administration, but also potentially hire inflation if we have some more terrifying.

I think that would be Normal to digest. I mean, the inflation has come down significantly over the last year and a half. So there is to be a higher for I don't think the fed and go back to power last week, they were basically think they don't want to see inflation two percent. They wanted to stay running above there. So I think the market I think the market participants are going to be used to look at a higher floor of inflation, and I I think that would would be Normal going forward.

And rob, you know, it's interesting. My query has a no doubt today saying stick with quality and growth and the bull f research basically says the opposite one says, go for the contrary. The other one says, no, not so much, go the opposite way. Where should you be putting your money if you have the chance your today just put some money to work .

when we have a bit a pullback, no question, it's a tiny bit of a pullback. I kind of you with that with everybody saying but there's no doubt that when you've had this type of the year, twenty plus percent performance, you get some of that uncertainty remove that you know my colleagues here i've talked about that you typically have a strong final two month of the years. So the probabilities are in your favor, the trends in your favor.

Um I I think IT becomes a little bit tougher in two thousand and twenty five because we're pulling forward some of that Price performance. And if you looked at the trumpet trade the last time, what you saw is everything that I was working then is working now. But IT was fleeting because what ended up happening as we pivoted into two into two thousand and seventeen going back away, that leadership that we saw early faded in new leaders emerged.

That was really the technology leadership that that was prevalent than the other thing that I would say is there was a very different environment back that is, well, we had very low CPI. We had we had a earnings that were actually accelerating. And you know, you started off with interest rates at one point eight percent.

You started off with valuations on the S M. P. That were about sixteen and a half times.

And when you have an environment like that, you obviously have more outside today, we are in a different place. Interest rates are higher. They're certainly more restrictive, right? Are higher. Yet when I talk to our climate base and there are some of the titans of industry, there is no doubt that they are feeling much more optimistic. I don't know it's about the administration. I think for many IT is I think it's the certainty that has come with that despite the uncertain new around terrifying and some of the things that is that he could he could ultimately .

do back in two thousand and sixteen, the eve of the election until march of twenty seventeen, the S. M. P.

Five hundred rally fifteen percent well, and then at the end of twenty seventeen year of twenty five percent. So that's what we're seeing here. Right, is about the vote.

IT is about earnings. IT is about you know you talk about high interest rates, absolutely agree with you, but actually you're about to embark on a right cut cycle. IT may not be as fast as we want them to cut, but that's actually very pozzo as a reason they say don't fight the fed. And when the fed is cutting rates, that's very pro risk on and risk assets.

Let forget d regulation and up and down the government. There's going to be a when behind businesses from from the S C, C reporting to ftc. I mean, there's only be a lot of ways that these companies are going to benefit within this administration.

too. Brand, I want to get your take and hear, obviously, a lot of things of and said. And I think that stephane brings up some good points, and we're looking at sort of the past to help guide us for the future. Micro also says today's environment very different than twenty sixteen.

What clues do you think we should be honing and on which ones do you think we should be wary of? And Frankly, have we gotten ten a little bit too far ahead of ourselves? I mean, trump is not officially taken office that we don't actually know what the policies will be. We're just sort of trading on campaign speak at this point.

I think at the index level, the trend is definitely feels like it's gona continue to go higher. And I think that would be foolish to fight that. But underneath that, the individual security level and at the certain etf level, for me there's a tremendous amount of film ale, if you look this week, like doge, point up two hundred percent. Like crypto, like levered microstrip gy etf of fifty percent yesterday, you know test of which both fill in my own, up thirty four percent and last week. And so I feel like you look in the options market these year today, expiration options, there's just so much volume and so much energy on these visual security levels that I think that investors need to be aware of their own formal and continue to be disciplined because I think you're onna get some really big moves at the security level as people are just really speculated and trade as we know, individual security can go much further on the upside or much low on the downside that they actually should. And I feel like we definitely have that on the outside with some individual names and especially within certain crypto pto currencies.

I think we're going to draw down more on that a second. So that's a good teeth but I wanted get to birtha com. She's got some breaking news force birth .

that what you ve got certainly the justice department and several states, a turney general are moving to block united health three point three billion dollar acquisition of medicine.

This has been uh reviewed for some time now, uh, merit garlands h, the distant detonite says attorney general rather says we are chAllenging this merger because home health and hospital patients and their families experiencing some of the most difficult moments of their lives deserve affordable, high quality options. He continues. The justice department will not hesitate to check unlawful consolidation and monopolization in the healthcare market that threats to harm vulnerable patients, their families and health care worker.

The justice department, of course, has tried to block a united health merger in the past. Several years ago, they tried to block united health acquisition of change health care of the billing services that was the arrival they did not prevail in a trial remains to be seen. Whether this will go to trial. And of course, certainly, we're at a situation where we are going to see a change of administration as this lawsuit is brought. Whether a trumpet administration, just as partment would be inclined to proceed with that lawsuit remains to be seen.

Very interesting the timing, most especially bird com. Thank you so much. I want to turn to you quickly build because you were just talking about deregulation, the potential for maybe more mergers and acquisitions and deals. What do you make of this news here?

The birthday just brought us. I don't have a hard feeling on I don't a horse in the race with with the united health. We don't own the naming any more, but I do think it's we can call to what we're seeing right now and this under this current administration what could potentially come here in the coming months as things flip.

So probably why the stock is not down that much, but right postcard are not down that much because I don't believe .

IT in the reaction.

But that would make a lot at another deal here blocked. Well, very interesting. We talk just a moment ago. I'm going to get back to this point. That one of the biest winner since the election, excuse me, has been test a shares pulling back just a bit today, but they're still up nearly what, forty percent at a week.

Bill, you trimmed your position on this yesterday and why was that a percent? It's got to about the three and half cent position and and hugging right out or top five is a forty percent move over the last week. And really we added to IT going back to August and we increased IT. There is a batty percent. So since we increased IT, so potfuls ly management, I did I don't want IT in the top five, and I think I could take a little bit of a breather here with just the exuberance and at the monitise ed.

that sometimes got IT and but you brought IT up. So I want to this otherness in tesla.

Yeah, I think that's a smart move. I mean, I listen to the earnings call. If I take the election and iran and all that out of the picture, the fundamental in the story around tesla is still really strong.

But do you understand the next or they're same, we're going to have the new car. I think it's like the hatchback three series. The company doesn't need to deliver.

And like this is a great example of a great company with a great founder, great team that gets over extended. I mean, I sell calls and this name. So at this point, I had some calls at to seventy that I collected like seventeen dollars of premium.

So at this point in january, this portion of my stock will get called away. And so where is bills trimming? I'm selling calls to manage my position.

So another big winter since the election. Brand, you also brought this sweet up to cypher o and becoming slightly lower right now. But this is that ring to nearly ninety thousand dollars. These moves are are just incredible, really. I mean, rob, when you look at something like this, do you feel like you just got to play this, whether it's a minor, whether it's the currency itself, whether it's an etf and which are strategy here?

So a so listen, it's definitely been violated, validated.

not and there's .

been a lot of pull forward because of what this administration campaigned on. And while we're not correct ldh, a bitt coin or tesla with many clients that on these names, and you have to say that they have been absolutely validated by what is happening there, there is a general embracing from the regulatory framework that is, you know, saying that these are real investments, real assets. And I don't think you can ignore that for sure.

And I I would tell you that to the those that hold IT knows that are big believer s whether be a Michael sailor and Anthony scar mochi or an islam mask, no, they don't care about the regulator or environment were on anyway. And I think many people in this space fear exactly like that. I personally own some. We don't recommend IT for clients. That happens from time to time.

A bill year believer.

I am a believer. I mean, I personally owned since two thousand and seventeen, but this year was the first time we incorporated IT into client portfolios. And really, it's about size I can properly.

When we did this back in july, we bought I bi T H the etf and and we did that as a half a percent and we bought marathon holdings as a half a percent. We look at that as as a hybels, a potential move in somebody. We expect a bitcoin ago from sixty thousand to one hundred thousand this year, which is closing ends. But that move so far, we would expected marathon holdings to do with three x, and it's worry about about twenty percent of a marathon holdings because it's been severely under performing up to this point. But the way we look at IT and what I want to lean on this is how we size things with portfolio, having the egypto exposure and sizing IT properly .

and bread you're playing this through in etf?

sure. yeah. I on ibt also on some bitcoin individually, but I bit and I think that you with the the direct with with the gbt c not becoming a trust with I bit, the low fees, the institutional zone of bitcoin, especially with I bit that's capturing the majority asset, coupled with the deregulation in a much flier c next year.

I think institutions are going to be feel much more comfortable about making this part of their allocation. And I still think there's lots of lots of tailwind. That being said, one coin base, and I love write arms drunk, but when in coin base you that sixty percent five days, that's a big. And so that's what I am telling investors. Just beware that tho, because you've just had these outsides moves and some of these individual names and history tells you these names are onna digest and pull back yeah.

absolutely. I mean, it's obviously getting in the awful lot of attention because these moves the committee also, though, making some other big moves in tech. We talked a little bit about this before.

When IT comes to the trumpet trades are built. You bought some more microsoft and amazon. Why now? Why those named specifically?

Yeah, I am first with microsoft. First, this is cash. I came from tesla with a lucky the sidelines.

So we've increased we've been underweight microsoft and wanted to get IT back to wait. We're adding to microsoft going back to the earning report. IT wasn't a bad earning report.

IT was a good earning report. IT was really the the guidance that really brought the stock down after hours. And then I think they are potentially lowering the bar.

If you take a look at us or their cloud is growing at what? Thirty three percent. I mean, there is tremendous growth that beat expectations. So really excited from the underperformance standpoint. It's going back to like february of twenty and twenty three that, that is underperforming the NASA to that level.

So there is a lot of opportunity for upside, and I I think we'll close that gap over the coming months as ramazan, it's simply is breaking out. They had up at him with earnings report recent weeks so as waiting for this, seeing this to liffy that break out their margins. Gw, forty percent on the report.

That is amazing. So I think there's a lot of upside here and there are unlocked the profitability with an AWS that ten billion in revenue. It's fifty percent from last year.

Is that is on your favorite to play the cloud.

I has to be one of our top three plays right now, our top three holding section video in alphabet. I think amazon this break out here after fAiling to do so middle of the year, this is subsequent up energy that really has to menus up.

I think that was the best quarter of the max seven yeah by far. And you mention profitability, but I was in a IT was in your world in north amErica retail, which actually grew up honor basis point year over year and then international, three honoris points. And then A W S egm ter, seven hundred eight basis points, thirty eight one percent.

That is huge. And they got a lot of Operating leverage as a result. And I don't know what they're going to do with their cash, but forty eight billion in cash, something has to happen here, either pick up that buyback or announced a dividend or something because that's huge and that's gonna go to sixty eight billion next year. So I agree with one hundred one large .

positioning with you. Some apples were not playing in these seeking on tech which move there.

I bought a lot in may o and it's up about forty percent since then. When I bought IT was at twenty six times forward. It's now thirty five times forward.

I'm just not sure the iphone sixteen is going to be that super cycle that everyone expects. I think seventeen and eighteen will be absolutely. I just don't think we're going to see IT right away. And I just think when you have revenue growth growing at about six percent earnings or down thirty percent, would you are going to pay for that? So i'm just looking for maybe a bit like a pullback in the name to get back into IT, but I made a lot of money and i'm just taking that put IT to amazon.

Actually, I don't disagreed. It's showing signs of exhaustion. Apple, right now, we owned IT still in our top five.

I'm a little more upbeat on this. On this cycle. There's a lot of people who owned the fourteen that are not going to get that apple intelligence.

And in that upgrade cycle is, is one of their large. So I think there's a big tae when that could be there. However, I don't disagree with you when I think there is some exhAusting the market, the stock, the performance is telling us that right now.

let's move on. Let's on. Move on to a meta value act, taking a billion dollar stake there. I mean, is that can add to the volatility Roberto make of this? You're knowns.

We are an owner and it's our largest overweight in the portfolio. We haven't sold a single year since we bought IT in late twenty two. Um you can tell the way we run money just by looking at the names we own here.

We're over way meta. We're over way google. Both low pe names were neutral apple or microsoft because we feel like they hit hit relatively a pe ceiling.

And you are need to see some of the things that, that build just outline for them to perform from here. We've own them a long time. It's very tough for us to trade in and out of those because the impact on clients and we're underweight.

In video, although we bought IT on the most recent dip when I dropped thirty times speed, now that is supported. We we're not chasing IT and sadly, we do not own amazon or that we'd like to we use to, we'd like to and test legs just too expensive for us to despite how I feel about the man and the business that they're in. So um meta in from morlands is by far of the best way to continue to play the monitise ation of A I. They saw tremendous strength in their advertising revenue and IT IT fed through to the the kind of rest of the the business bit .

saying the company saying the market continues to undervalue the long term core earnings power of these due companies. And you also are an owner of meta.

Yeah, we went matter. And I I think you're robby. You definitely highlighted the advertizing tools that they provide. I mean, you're seeing you're seeing a lot of moment and behind. I mean, they're really implementing A I the one not obviously, the elephant in the room is, is the capex spending and that with something that's going to continue you to be there. So if they have really kind of, you know write that ship, I mean, there's there's could be trying to upside bill.

It's funny there though is that's why they got hit years ago because they were spending too much. They weren't managing costs. They got that act together now they're very enthusiastic about the prospects. And I think markets are more accepting about investment today then they may have been when they were investing in the metaverse. So I I really .

think it's different. A I diverse. Yeah, yeah.

it's A I arms. If you're not spending, you're going to .

fall behind when the media SE was all the rage like a minute.

I know exactly now .

it's all about AI stuff. I want to talk about a crowd, right?

Because you're getting involved there. yes. So I I never owned IT before. And when the stock fell forty percent after the microsoft clip IT, and I thought, wow, this is the number one company in this cybersecurity industry, which I am hugely bullet shop between now in the end of the decade. Kind of hurt not to be right.

I think I think cyber security is bigger than A I, I, I really do. I think it's going to mean well north of a trillion dollars and spend. If you talk to ctos at any company, they're saying they're ending on two things.

A I because they are trying to figure that out. And cyber security because they can't wake up and lose their business overnight. And so cross like number one player, number one management team, number one products and platform and their retention in the past quarter even after the microsoft ledges, ninety eight percent.

So you're growing, earning forty percent revenue, thirty percent uh, and a lot of the other metrics really very, very healthy. So it's still down about fifteen percent from its high. So that's why I just continue to add uh, after I told some of the apple but put IT in to amazon and know just manuvring my technology .

yeah picking up some of the opportunity. I know you also own cross, but I want to get to be in obviously going to give you a little bit of a jump ball here with tech. What do you make of the move crowd strike? You want to talk about meta where you want to go with this?

Yeah mean what I own bug, which is the etf, which I mean, I think stuff is spot on about the spin for cyber security and A I that the spend for cyber security, this is a secular issue. And I think that spend is very gonna consistent and it's gonna high. So i'm only going up the of the etf bug.

But I I love steps, move in a crowd strike. I think this is just a space of growth. You can have consistency like people with apple own apple because IT has a durable baLanced that continues to grow. And I think people continue to allocate to the space because, you know, the tiger is just going to continue to me, I think, to be in the double digits for the foreseeable future.

Rob, you on four net, and that's hitting a record high .

hair today indeed. But if you would have talk to me back in july, I would have been a very sad person.

Time .

actually.

he was actually down, down for the year. This is an example what where patience patience has paid off. You know that was the relative value play versus palo alto and crowd strike. If you look at the the multiple on those names, they are eighty two, sixty one unfortunate trades IT know forty one times earnings. They are hardly giving IT away. But if you're to play that secular theme, we'd like to play IT on a value basis and have finally been rewarded for some of the positive things that are happening with this .

team form that up forty one percent over the last three months. Okay, let's talk about IBM. Stephanie, you bought more of this.

why? Yeah, because the stock has down about nine percent from when they reported about a month ago. And I thought the quote was actually quite good.

This is the company that is really in a transformation in terms of finding growth and getting away from their legacy name frame businesses. And their growth is coming from software. And part of consulting is part of services.

But software was up about ten percent. Red hat was up fourteen percent in the quarter. IT accelerated, which is very excited, surprising, but we've been waiting for that for the last couple of quarters.

And of course, gena, I they have exposures now. Three billion dollar business for them. IT was only a one billion dollar business last quarter, but a huge growth for them.

And the free cash flow guidance of twelve billion plus, they have have a lot of flexibility in what they can do. And this CEO is just absolutely delivered on what he said he was going to do. Make this more of a growth company is not hyper growth, but is more it's growing more than ever has. And I think as they do more and more ma going forward with the cash that they have, I think they continue to grow.

And give you the last word before .

with an opportunity set for IBM. If you've looked at IT over the last few months, it's actually outperformed the tech sector. This is a name where soft ware and cloud input structure are gona be huge jassem going forward, uh, going forward for them. And I think this is a name that a turnaround story people are paying attention to big blue again.

Yeah there you was going to say it's not as talked about the video, but kind of some sneaky, some sneaky things to follow along there. With big blue will coming up, we have even more committee moves to tell you about. You want to sticker out the first, a look at the state of retail, the drains on home depot lows target and more half times back, just two minutes down, down about two hundred fifty points to welcome back shores of the home depot t component lower despite beating earnings, is the company raised to pull your outlook but expects come sales of all two and half percent staff you owe IT still negative come sales eight corner in a row. But it's but IT was the best consoles result we've seen about seven quarters.

I think it's a long time coming. Yeah, IT is and this is before interest rates will help them. So they're doing in all they can court you know this right, just to deliver and actually beat expectation.

The whispers for comments was two point five percent, and they came in at one point five negative, one point five percent. So certainly a little bit Better of her cains actually helps them. And the weather also help them.

But they are doing a really good job in terms of margins, in terms of gaining share in the pro market with the S R S. acquisition. And I thought that IT was really interesting that sales have actually output paste inventories for the last six quarters in a row.

That's a very healthy sign, as you know. So they're gonna have pricing power. They're onna get to man when rates come down. And still a big fan of housing for the for the next decade, just given the supply domain dynamics .

I spoke with CFO rich mic fail head of the call and he was sort of saying, look, we think it's only a hater of time for our homeowner to stop deferred these big they're waiting on interest strates. We need that to stabilize that what the decor said on the call, just when they thought interest strates are coming down, they didn't, in some cases, when higher. And so they're just reluctant to make those those big purchases. But he said they are not trading down. It's not like they're doing the project at a lower Price point.

There is waiting in turtle. They were huge beneficiaries during IT. But how many dishwashers do you need? This was very encouraging.

A on a five years stack at the highest ticket acceleration, said the second quarter. Twenty twenty three are some good things underneath the surface. We just need rates to go in their favor.

Rob, you on this one, what did you think about this quarter? Would you make any moves based on .

IT despite some of the things that happened that were I O syn craw to this corner like the weather, I think you have to say that the worst is likely behind both home deepo in laws. Home deepo moved to the professional the professional customer versus the DIY in that pressured margins a little bit as well.

When you look at the way the stock is acted since since reporting and the prospect for lower interest rates, again, we will see if IT if if IT actually travels the path that markets expect. But if you get that there's huge optionality in these names yet, there's small positions for us. Okay.

we're going to stick with retail for a second year because we've got some new numbers actually showing the U. S. Consumer is holding strong slides. Get to senior economics reporter Steve eman. He's got ten more on that was some propriety data.

His Steve, hey, good afternoon. courtine. The cnbc masa retail federation retail monitor using actual credit data from affinity solution shows because he was bouncing back in october after disappointing september, with americans maybe seeing a little extra money in their pockets from declining gas Price.

To take a look, the retail monitor, again, actual, actual spending data of infinity, this is our top line data, takes out auto and gas up zero point seven after a zero point three percent decline in in september, year on year for one. And then we take out restaurant to do a you can see this if I don't walk away, a core retail number, zero point eight percent again after a zero point three percent decline. A note, the census reported a pretty strong number in september of solar game, with a disparity maybe related to season adjustments and the tRicky timing of labor day for october.

Though sporting goods and hobby doing quite well, non store. We tell if such digital cells really building in garden supplies, hey, maybe home deeper in their health care. I say homes, hobbies and health were all did well.

What didn't do well, clothes and series. I'm going to ask more about this just a second because that could have been weather related. We were around five degrees, one more than Normal in october. So maybe retailer has got caught with a little bit of extra extra winter and and cold weather where the infinity data shows spending on gas is fAllen three months in a row. And in twelve over the past fourteen months, the retail monitor singer around a little bit when IT comes to the census data. But overall poster minus absolute error of about zero op people, percent cpar with the government data now remains to be seen how much hurricanes in october affected the spending data, especially in fara street, looking for the government to report a modest zero point three percent gain in retail on friday. So cordon, yeah, maybe some warm weather affecting those of paro sounds.

Yeah, I think absolutely that is the case. I mean, home depot talked about one weather. Of course I don't. So clothing, what's your point, right? I mean, how excited are you to buy a winter coat when it's eighty degrees on halloween in your side?

I no in. Because we had the drought throughout the countries and no umbrellas and no raincoat. But I don't know, cord, if you're excited design for the november data, we started looking into seeing how the holiday season is going.

Yeah, I absolutely am still. And if I can grab you before we let you go here, I thought I was interesting in the press release the quote for match talks about Prices actually flowing in some categories. And this, of course, comes ahead of CPI and IT.

Just seems to me that so many americans are so Price sensitive. Perhaps we saw that played when many went to the polls on election day. I'm just curious what you think will see tomorrow in CPI, based on potentially what you ve seen in some of the patterns .

of the data where we've been a little stuck, we have to had quite deceleration that we had in other months in the past couple. So we'll see if he continues tomorrow looking for zero. Choose pretty much across the board on the CPI and you're write a tomb ark in the russian fed president in a speech is afternoon this morning said that he thinks consumers more Price sensitive and the other important part of that is Price sensitivity teaches businesses how far with their limits in terms of raising Prices. So i've seen, for example, when I went to um what was to stop and shop the other day, there was a sign that said we've lowered and then I had dozens crossed out, hundreds crossed out and the words thousands of Prices. So it's saying companies are not only learning the limit to which they can look and raise prizes, but also I think feeling that sensitive ity from the consumer and actually lower in Prices where they can in certain places.

Yeah and giving some of that messaging right back to them, seeing if we can get them to react to you. Thanks so much. Great up. As always, let's go over and get the headlines with Julia borst. Hy, Julia?

By the eba nounce new rule today, they would charge to oil and gas companies a fee. If they, amit mEthana ove certain levels, companies will have to pay nine hundred dollars per ton for the excess mEthane they produce this year, and fees will rise to twelve hundred dollars per ton in twenty twenty five and fifteen hundred dollars per ton in twenty twenty six.

The rule will finalize early next year, and the industry groups are likely to chAllenge IT, including efforts to enforce the fees retroactively, international aid groups said today, israel has failed to meet U. S. Demands to allow more humAnitary arian aid into gaza.

A thirty day deadlines by the biden administration calling on israel to quote, surge aid and to gaza expires today. Failure to meet the deadline could trigger U. S. Laws that require IT to pull back on military support and abolitionist harriet tummin was positive. Ously awarded the rank of general in her home state of maryland and veteran state ceremony monday. The ward makes topmen, who is the first woman to oversea military action during war time, a one star brigade general in the state's national guard, back over deal.

Thank you very much, Julia. Well, coming up one big industrial stock, getting all time eyes on activist activity, plus a stuff me link, making some more big moose in that sector of the trades coming up next one half time, i'll go back to half time. I'll check out shares of honeywell hitting a new record high today.

Activist investor elite management, taking a massive, taking the company and pushing for a break up, sticking with the industrial stuff. You are making some moves in this space. You just about rockwell automation, I believe for the first time in forever, as my kids were saying from frozen.

like ever, I i've never owned IT, but i'd like the rehearing theme. We've talked about the names that I own, quana services, G E ver nova eaten. They're all up about fifty, fifty five percent a year to date.

This one is also on the same theme, but it's down ten percent on the year. It's down nineteen percent since twenty twenty two. It's done nothing and they have best in class assets.

They have a new CFO from gro. And when he was at greek in twenty eleven until he just recently joined this company, uh, the stocks was up six hundred and thirty three percent. So I know it's not just the CFO obviously in CEO in the bench, but that he's a very strong candidate.

He is very strong in terms of margins, new product initiatives, eeta. They've got a huge cost cutting program as well, new product innovation. And so I like that theme, and i'm just going to find some lag ards in the reassuring theme because I think it's a tender lion dollar total adjustable market over the next twenty five years.

Speaking of a lag d, probably not reassuring.

but born and how IT has been definitely been a legend. It's been very disappointing this year. But I think if they're starting to turn the corner, they just raised twenty one billion dollars and catch.

So their baLanced is okay for the next three years, gives them breathing room. They fixed the strike situation, which I think is very positive in them. There are some speculators that are going to sell their navigation business and other non core assets.

The navigation business could go as much as six billion dollars. And so this new CEO IT takes up some time to get your footing. And so I think he's got a great track record.

I think you're going to see more asset sales. I think this is a twenty, twenty five story. So I don't think i'm going to make a lot of money between and the the year, but I do like the the name for for the long term in a do apply. It's not a demand problem. It's been a company specific pressure.

But you're not in the space at all. You don't see opportunity here like stephane does.

I mean, stuff like is that for a chAllenge? And so I think she's got this with boy, I just thinking of that they can even get their asked their star liner right. You know, I think it's just such A A troubled company that we have astronauts in space now that space sets their competitor has to go get.

And so obviously, stiffed as a great work. I just think some companies are just in the too hard camp. And to me, IT feels like this company is just like a bureaucratic mess.

And when you have to do apply, how can they get IT this wrong? And so I just think this has been such A A troubled company that needs a massive real and maybe to her point, maybe the new city open come in and do that. But IT just seems to be something that's more structural, but not just at the sea sweet level. But I hope i'm around and that does really well.

Twenty billion are not involved in ball and you do have some industrial but your trimmed.

Why we've been the last two over last two weeks ago. H I head a lot of the earnings from industrial s wab tech W A B is one of her in the top five. So when I talked about microsoft and adding to that is a little bit of rotation we've been doing to meet some of the industrials, they're up over fifty percent in year today.

I mean, how much more can you ask for from an industrial name? And other one is united rental. We still really love them.

There are right around between ten and a rank out of thirty five names and and you are I also up more than fifty percent year. Data is inner concentrated, important link where we own no more than ten names. So we like a lot of these.

I think there they have these niche businesses that can lean on infrastructure spending, specifically in new arise case. Mass tech is another ones up about eighty percent year today. We haven't trim that one, but we've kind of letting IT run is breaking out. And I think there's there's a lot of targets on the street that say that can get hit. One seventy.

one eighty was ahead, mike say, and tolly has his middle word half time. I'll be right back. We're back on half time.

Seated markets commentator like and joins us with his midday word might put pull back in context. Forest, pull back. I mean, yeah.

it's very mode, especially in relation to the last little pop we ve got over the last week. But IT does seem like it's come pretty on time. Just to calm things down a little bit, this rally went from like zero and nutso in a hurry in terms of parts of the market that we're getting over excited.

And you guys have talked about some of them whether IT was the vertical moving crypto o yesterday, the original mean stocks started to move for absolutely no reason except for that sort of pool of of trading capital got over excited. So I do think that makes sense. We are pulling back now.

Of course, a lot of the markets been reacting to a very plausible repricing of growth expectations, and that's probably going to remain underneath this market. This idea that were well supported if we thought a recession was a possibility before is probably even more remote given the policy mix. However, Bonnie's taking higher, kind of looking for that point at which IT might sort of restrain equity for forty four on the ten year at this point.

Not alarming, but something to pay a some attention to. And just to to the S P. Five hundred, you go down couple percent from here and you go back to the previous highs. IT would make all the sense in the world as just a little bit of a reset doesn't mean you get IT, but that would be Normal if we did .

and we're expecting the CPI tomorrow. I mean, wasn't that many months ago that sort of sent shivers down? Or just wondering what's going to happen there. I mean, what do you think any chance for a rip effect from that?

We pass those shivers, you know.

couldn't say there's no chance of that only because of the few position for these various markets. So if if you got a hot number that seems like we were getting sticky on the inflation side and and the yell move gets more algeria, then maybe you have a little bit of something to worry about, but we're already pricing out fed rate cuts before we even get CPI. sure. I mean, the two year year words training right now is not anticipating a lot in the way of further cuts. So I not sure how much more will get pushed that direction based on the one .

number a little bit of cooling off day, maybe that's all. Have three bullish calls on three committed stocks, we to take them and our calls of the day, and we are counting down to see abc delivering alpha investor stomach. IT is in new york city tomorrow.

For details, go to C, N, B, C dog s lash delivering off at, or scan that Q R code. right? Aren't your screen? See IT half time.

I'll be right back, broken back time.

Now for our calls of the day, snowflake added to the best in breed list of D A. David is on seventy.

You on this one? I do it's been kind of a bad one, down thirty seven percent to year today. But I do still think that these guys are the best at what they do in terms of providing data, clean data for A I.

A I is only as good as the data. It's a total dressed able market of two hundred and ninety billion. These guys have the leading share. I think you're in the early innings overall. And I think the company now you've going to have two quarters now of under the new CEO.

And usually, IT takes about two or three quarters to get a new CEO to understand how to work wall street and work the magic within the company as well. And so stop cheap. But it's certain the multiple has come down substantially. And I just think that this is one way to play a that might be off the radar screen from a lot of four, a lot of other people.

But and you do not think this one is best in breed.

Well, no, I think, no, I think that the stock has not been invest in breathe. And so it's a curious name because it's like the market does not like this name, but they have great, great product, lots of adoption. But it's still the market is just saying down thirty five, forty percent.

We don't like this name. And so i'll be curious over the next few quarters if they can just hive IT on that because you would think that they would be getting more adoption from a company perspective, but just dollars aren't flowing, mayor. So I think so hopefully, next year doesn't look like this year and they can finally gain some traction with with the with the new CEO.

And we're moving on very quick here to well, argo added to the us one list of bank of america, rob you on this one.

I do we prepare, as I talked about yesterday, some other financials relative to this right now has been a long term holding for us. They did a reasonably good job in their most recent earnings report. They beat on the bottom line.

They manage expenses well. You know the investment banking revenues did well. Um you know when you look at non performing loans, they held steady. So I think this is an interesting name, but we are looking at names like jefferies and names like korea's names where you can get a little more Price performance because the financial sector is is getting expensive right now.

And then one would be a quick here, salesforce target raised to three thirty from two seventy five. This one at will's far of this is a new record, high hair. And rob.

you own salesforce bought IT over the summer. This is emerging as one of the leaders in the monitise ation of a of A I um one of most influential software companies, the world one where you're starting to see forward earnings get adjust to higher. I think that's part of the problem with some of the names that are the big ones that have been winners.

These four of learners are coming down. Expectations are coming down a little bit. So you want to see those accelerating. And sales forces, one of those with great fundamental.

they raised the target to three thirty. But right now, he is trading at three, forty three. We'll stay with us final trades coming up on that time. We're back on half time of the final trades.

Brand will start with you. Yeah R, S P, S M P equate while it's equate by stock, it's not equate by sector, financial and industrial of the top two holdings.

Rob up.

i'm going to go with the same pic for me yesterday. C, R, M, and we've talked about IT today.

I'll seed my time. Really believe in that one built microsoft.

I expected to outperform the nash ACC between now and the into .

the year and stepping bring us .

home target very low expectations. Value proposition, getting people in the stores, ten thousand sku cuts, Price cuts, that's good. I expect a solid quarter and .

be some interesting moves for retail in the coming week or so. That does IT for a half .

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