[SPEAKER_02]: On radio, on YouTube, streaming live on investtalk.com and for our podcast subscribers, this is Invest Talk.
[SPEAKER_02]: Independent Thinking, shared success.
[SPEAKER_02]: Invest talk is made possible by KPP Financial, a registered investment advisor firm, serving clients throughout the United States.
[SPEAKER_02]: Here is KPP Financial Chief Executive Officer, Financial Advisor, Justin Clyde.
[SPEAKER_03]: Good afternoon fellow investors and welcome back to Invest Talk.
[SPEAKER_03]: This is our Tuesday, March 24th, 2026 edition of Invest Talk.
[SPEAKER_03]: And I'm excited for this hour to unpack another interesting day in markets.
[SPEAKER_03]: It was a continuation of a bounce back we had on Monday, but this is a market that can shift from day to day.
[SPEAKER_03]: and how that will impact the rest of the week, and maybe even the rest of the year.
[SPEAKER_03]: So a lot to discuss today, big cell-offs in in text docs, really, most of all, but some strength elsewhere.
[SPEAKER_03]: So we're going to dig into that and much, much more on today's episode of Investock, but mostly this show will be about you.
[SPEAKER_03]: It's our will be about you, your questions.
[SPEAKER_03]: Anything that's on your mind, money related, we are here to give you perspective, data, and feedback so that you can make better decisions with your money.
[SPEAKER_03]: So just a bit, we'll talk about today's Mark performance and run down the show topics for the next hour.
[SPEAKER_01]: But as usual, we'll tackle this first call a question now.
[SPEAKER_01]: And I was just wondering what you guys think about this company for medium to long-term hold.
[SPEAKER_01]: Would love your guys to take on it.
[SPEAKER_01]: Thank you.
[SPEAKER_03]: All right, looking at SM Energy, this is a, I believe this was, what's the one, it was a merger.
[SPEAKER_03]: I'm trying to remember off top of my head.
[SPEAKER_03]: There was a merger of two smaller energy names to make this one.
[SPEAKER_03]: I'll remember it at some point, but Savitus, there we go, Savitus was one of them and then some energy.
[SPEAKER_03]: So, $7 billion market cap, they do have a pretty, they have a pretty levered balance sheet that looks to be a bit better now with a merger, free cash flow, $500 million on a $7 billion market cap.
[SPEAKER_03]: It's rally considerably as you would imagine with oil prices up there in EMP company.
[SPEAKER_03]: Uh, both oil and gas earnings are expected to be she down 19% this year, but back up 27% next year, the $5.57 and a $30 stock.
[SPEAKER_03]: That's pretty good for looking multiple.
[SPEAKER_03]: And what we know is that these energy names or energy prices, they can spike.
[SPEAKER_03]: but the cure for high prices is high prices, and so this having a larger pullback would not shock me or along with with energy prices, but this is really a question on the near term as what do you think is going to happen with?
[SPEAKER_03]: the military conflict in the middle east.
[SPEAKER_03]: And so, in the short term, I would say you want to be probably selling any big spike, especially if you get up closer to $1.5200 a barrel per barrel of oil.
[SPEAKER_03]: That will, will be very short lived.
[SPEAKER_03]: I could almost guarantee you we're not going to sit at $200 a barrel for any like the time.
[SPEAKER_03]: That could be hanging around here around the
[SPEAKER_03]: as much demand erosion at these prices, there would be a dollar.
[SPEAKER_03]: We already almost doubled doubling again, that would be a major major problem here.
[SPEAKER_03]: Right now, it's a nuisance, it's a big problem for some industries, but really not for the whole economy, because the economy is not as energy-intensive or at least oil-intensive as it used to be.
[SPEAKER_03]: And so this could be sustained for a little while, and I could see higher prices for SMNG.
[SPEAKER_03]: You look at the profitability, return equities around 14%, which is good, but not amazing.
[SPEAKER_03]: So long-term, I probably would not own this, but in short to medium-term, I would, because I do think the possibilities in their Middle East will continue in fits and starts for a period of time.
[SPEAKER_03]: So kind of depends on your time horizon there.
[SPEAKER_03]: Now, I hope you had a chance to participate in our best talk market madness contest,
[SPEAKER_03]: And today was the final day of the first round.
[SPEAKER_03]: So we're down to 32 companies.
[SPEAKER_03]: And today was the consumer region.
[SPEAKER_03]: That's what was the final region for the first round.
[SPEAKER_03]: Some interesting winners.
[SPEAKER_03]: I know, well, if you look the leaderboard,
[SPEAKER_03]: Luke was near the top.
[SPEAKER_03]: So I'm kind of middleing my brackets and in the middle, but Luke's algorithm actually's working pretty well.
[SPEAKER_03]: So that thought that was of note my biggest takeaway that Luke's algorithm using AI and his regression analysis.
[SPEAKER_03]: actually working.
[SPEAKER_03]: So that was market madness, but we have a girl that grew out a lot of ground to cover over the next 45 minutes or so, and time permitting, we will get to all of it.
[SPEAKER_03]: Our main focus point is that prediction markets, how poly market and sports betting are reshaping finance.
[SPEAKER_03]: MLB is an exclusive partnership, a polymarket.
[SPEAKER_03]: That signals a growing acceptance for the prediction markets in mainstream finance.
[SPEAKER_03]: And these platforms are evolving.
[SPEAKER_03]: So how does that impact things like sports betting?
[SPEAKER_03]: We'll dig into that story.
[SPEAKER_03]: In addition, could we have an O8 style shock?
[SPEAKER_03]: Driven by private equity?
[SPEAKER_03]: Talk about that.
[SPEAKER_03]: I mean, liquified natural gas, LNG, a lot of people are heard of it, but do they really know how much of an issue, an end or not an end, but a major reduction in the movement of LNG would be for the broader global economy?
[SPEAKER_03]: We'll dig into that story as well, but ultimately, I want to know what's on your mind.
[SPEAKER_03]: We have voice bank questions, one is on private credit versus private equity.
[SPEAKER_03]: And then zebra technologies, ZBRA, we have some questions that came in via the comments section on the Investor YouTube channels.
[SPEAKER_03]: Well, and of course most importantly, your live calls will always be number one, so do not hesitate to reach out if you're listening via our live stream or possibly on AM1220 in the Bay area.
[SPEAKER_03]: You can call right now at 80 to 99 chart.
[SPEAKER_03]: Now we're heading into a quick break, but next I will comment on today's market activity.
[SPEAKER_04]: When you tell your friends about Investor and they ask you why you listen, let them know there are many reasons and one is parallel investing from KPP Financial and Investor Coast Justin Klein.
[SPEAKER_04]: Parallel investing means Justin invests right alongside KPP financial clients.
[SPEAKER_04]: He makes the same trade for KPP financial on the same day at the same price and the same percentages as KPP clients.
[SPEAKER_04]: There's no front running and no special treatment.
[SPEAKER_04]: In this way, Justin and KPP financials share the same risks and the same potential for success.
[SPEAKER_04]: Parallel Investing aligns the interests of Justin and KPP Financial with those of his clients.
[SPEAKER_04]: Justin, Klein and Luke Guerrero are ready to answer your questions about Parallel Investing.
[SPEAKER_04]: And you can learn more anytime at Investalk.com.
[SPEAKER_04]: Your questions are free.
[SPEAKER_04]: The answers are unbiased.
[SPEAKER_04]: Justin Klein is here now.
[SPEAKER_04]: Ready to take your calls live.
[SPEAKER_04]: Invest talk.
[SPEAKER_04]: 88899 chart.
[SPEAKER_03]: 8899924278.
[SPEAKER_03]: So I get to ask your question on today's show.
[SPEAKER_03]: Let's take a look at the markets today.
[SPEAKER_03]: and we continue to get a bit of a bounce across the broader market, but it was large cap growth that really dragged things down dramatically.
[SPEAKER_03]: The NASDAQ was down nearly 1%.
[SPEAKER_03]: The S&P was only down about a third of one percent.
[SPEAKER_03]: The DAQ was only down about two tens of one percent.
[SPEAKER_03]: The global markets, the globe, is actually up about 16 basis points.
[SPEAKER_03]: So not a huge gain, but some movement there.
[SPEAKER_03]: So that was really of note.
[SPEAKER_03]: If you look at names like Google down nearly 4% Microsoft down 2.7% oracle down 5, Netflix down 2.6 pounds here down 4.
[SPEAKER_03]: Salesforce down 6, app loving down big into it down 5%.
[SPEAKER_03]: down drafts in the major in the major tech names.
[SPEAKER_03]: Just shows you that this recent balance doesn't really have a lot of legs.
[SPEAKER_03]: And you certainly have to be worried that this is going to continue to weigh on the markets, because there were some nice gains today.
[SPEAKER_03]: You had out of the product manufacturing space.
[SPEAKER_03]: That was green.
[SPEAKER_03]: You had names like Gvernova, 3% Applied Materials, up 3 caterpillar, up 2.
[SPEAKER_03]: Obviously, energy is stronger with Exxon up 2.6% on the day utilities were strong.
[SPEAKER_03]: Even healthcare did okay, and the finance space did okay outside of Robinhood, there was a lot of green.
[SPEAKER_03]: So a very interesting day where money coming out of the hyperscalers, the Mag7, and into
[SPEAKER_03]: where those types of skills are spending a ton of money on their products.
[SPEAKER_03]: Those that really belong in short of today in the market movements.
[SPEAKER_03]: Now, when it comes to the economic front, you had PMI numbers.
[SPEAKER_03]: The global U.S. composite PMI is 51.4, consensus is 51.7, so a bit weaker than expected, but manufacturing came in a bit stronger,
[SPEAKER_03]: The services side can at 51.1 versus 52 expected, so a bit of desoloration and weakness on the services side.
[SPEAKER_03]: And we always say services are more important than manufacturing to overall economic growth easier in the US.
[SPEAKER_03]: So the business activity is slowing weaker new sales, spike in prices because of,
[SPEAKER_03]: the Middle East War, so import price suspect on higher energy cost, overall input cost pushed to a 10-month high, driving the largest increase in selling prices in over 3.5 years.
[SPEAKER_03]: So inflation is headed our way.
[SPEAKER_03]: The market is now pricing in in one year that inflation will be at 5%.
[SPEAKER_03]: Just go back to 2021, 2022, and that timeframe, inflation peaked out around eight or nine percent.
[SPEAKER_03]: So we're going to get more than halfway there.
[SPEAKER_03]: Most likely, if these oil prices continue at these levels, Richard Fed index came in flat, consensus of negative five, so that was a bit of a positive as well.
[SPEAKER_03]: But overall, it's more about
[SPEAKER_03]: did President Trump really talk to anybody in Iran or is he just job owning for a week and getting a market bounce and play in that game?
[SPEAKER_03]: Looks more like that because nobody in Iran is confirming that talks have been held.
[SPEAKER_03]: Treasuries were weaker with yields up seven or eight basis points on the short end.
[SPEAKER_03]: It shows you that the marketing teams
[SPEAKER_03]: why those growth names are down.
[SPEAKER_03]: They're long duration assets and long duration assets are going to continue to struggle.
[SPEAKER_03]: So you want harder assets most of all.
[SPEAKER_03]: Dollar next is up a half percent gold finished down point one percent silver finished up point three percent Bitcoin off one point eight percent on the day and WTI finished up four point eight percent Brent crude up four point four after a big drop.
[SPEAKER_03]: yesterday.
[SPEAKER_03]: So we're still kind of shopping around this $100 mark on WTI.
[SPEAKER_03]: So that was the market today.
[SPEAKER_03]: Let's head over to a YouTube comment question.
[SPEAKER_03]: As says baller says, thanks for the informative video.
[SPEAKER_03]: Can I get your take on A, G, M?
[SPEAKER_03]: Any chance to think this will rally again?
[SPEAKER_03]: Look, learn my lesson, held on the way up and back down.
[SPEAKER_03]: AGM is Fed, Agriculture, Mortgage.
[SPEAKER_03]: Company, this is a federally-charted instrument.
[SPEAKER_03]: It's generally instrumentally providing secondary mortgages for a variety of loans.
[SPEAKER_03]: If I remember correctly, this is,
[SPEAKER_03]: government sponsored entity lending to the ag business.
[SPEAKER_03]: The issue right now is that the ag business is a bad business because the cost of fertilizer.
[SPEAKER_03]: Fertilizer prices are skyrocketing with oil prices, sorry, with energy prices, because as I've said before, a lot
[SPEAKER_03]: of the cost by half of the cost of synthetic fertilizer is actually natural gas and urea and all the inputs to those end products.
[SPEAKER_03]: And so you certainly are filling the pinch, which means that the profitability of these farmers are going to be down, maybe even to negative territory, some may be a bankrupt, which would
[SPEAKER_03]: put AGM on the hook for it.
[SPEAKER_03]: So that's the worry here.
[SPEAKER_03]: A lot of people are gonna be after that dividend yield of 4% and that probably will stay because they, once we're in our government backed.
[SPEAKER_03]: So if you're looking to pick that up, that's fine, but know that it is a long duration asset and I probably wouldn't be aggressive here.
[SPEAKER_03]: Could it bounce, sure?
[SPEAKER_03]: Let me give you a better level.
[SPEAKER_03]: Yeah, around 1.30 and a big bison would be around 1.10, so it was 1.30s the next support level and then 1.10.
[SPEAKER_03]: Thanks for the question.
[SPEAKER_03]: Now we're heading to a break.
[SPEAKER_03]: I'm ready for your calls right now at 8.89 in charge.
[SPEAKER_04]: In today's market, more than ever, you need unbiased investing guidance, because it can help you achieve financial freedom.
[SPEAKER_04]: Well, you've come to the right place in Vestock, 888-99 chart.
[SPEAKER_00]: Hi, this is Jen in Portland, Oregon, and I have a question about private credit versus private equity.
[SPEAKER_00]: There's a lot of news lately about private credit.
[SPEAKER_00]: and investors winning redemptions, firms not always allowing all of those, and I was just wondering if you can speak to whether private credit also includes private equity firms, or if not, three companies like how those interact, and also if they are something separate, I'm also curious like what private equity firms look like right now in terms of performance.
[SPEAKER_00]: I know that they often have investments in the forms of like limited partnerships,
[SPEAKER_00]: reporting that might be somewhat opaque or limited in frequency.
[SPEAKER_00]: I would love to hear the answer on your show.
[SPEAKER_00]: Thanks so much.
[SPEAKER_03]: This is a great question and there are some similarities and differences.
[SPEAKER_03]: The first similarity, the main similarity, is that they're both private.
[SPEAKER_03]: They're both called private, private equity, private credit.
[SPEAKER_03]: Meaning, you don't know what the true value is.
[SPEAKER_03]: It is private.
[SPEAKER_03]: It is not public.
[SPEAKER_03]: It's not in public markets.
[SPEAKER_03]: It's not traded every day.
[SPEAKER_03]: That's the better.
[SPEAKER_03]: That's the best thing about public markets.
[SPEAKER_03]: It is liquid.
[SPEAKER_03]: It is transparent.
[SPEAKER_03]: You know what the value is.
[SPEAKER_03]: Don't let anyone ever tell you that private is better than public.
[SPEAKER_03]: If you're talking about the same asset class, say that.
[SPEAKER_03]: Now, there are private startup investments, things like that that may be great opportunities.
[SPEAKER_03]: I'm not going to poo poo those, so I've made those.
[SPEAKER_03]: And I'm great with those.
[SPEAKER_03]: But if you're talking about asset classes in general, I much rather own public credit or public equity versus private credit or private equity.
[SPEAKER_03]: So those are the similarities.
[SPEAKER_03]: Now, what are the differences?
[SPEAKER_03]: Basically, bonds, it's this capital structure.
[SPEAKER_03]: You own when you own private credit, you own the debt of these various companies and it's a portfolio of debt, portfolio of companies that you own the debt on.
[SPEAKER_03]: Private equity, you own the equity.
[SPEAKER_03]: Go to this, you own effectively ownership in the business, the upside of the business.
[SPEAKER_03]: That's more risk, because you're lower on the capital structure.
[SPEAKER_03]: Credit,
[SPEAKER_03]: That is at or near the top of the capital structure.
[SPEAKER_03]: So that means in bankruptcy, they're the first ones to be paid back.
[SPEAKER_03]: Resekuity, you're at the bottom.
[SPEAKER_03]: And usually in bankruptcy, you get next to nothing.
[SPEAKER_03]: A private credit has to pay you out money every day.
[SPEAKER_03]: They're regulating some as monthly quarterly, et cetera.
[SPEAKER_03]: And they need their companies to perform in order to get that cash flow.
[SPEAKER_03]: Whereas private equity, the hope is that eventually they'll sell off the businesses, maybe to another private equity firm, maybe to go public.
[SPEAKER_03]: That's the ultimate dream is to actually take some of these companies.
[SPEAKER_03]: They bought and take them public and cash out.
[SPEAKER_03]: But that could be in five years.
[SPEAKER_03]: they continue to push, kick the can down the road, and push winding down a lot of these private equity funds.
[SPEAKER_03]: And so later, later, because they can't get liquidity for these businesses and all of them are struggling.
[SPEAKER_03]: And the same with private credit, but once again, you know that easier because they're actually, are they paying you or not?
[SPEAKER_03]: They're supposed to be paying you.
[SPEAKER_03]: Not in picks, what's called payment in kind, but actually cash.
[SPEAKER_03]: And some of them had stopped doing that.
[SPEAKER_03]: And so that's the difference here.
[SPEAKER_03]: So the private credit is safer or than private equity, but it does have its own potential issues.
[SPEAKER_03]: And think of it as a very junky, high-yield bond fund.
[SPEAKER_03]: It's effectively what it is without you knowing what the value is and hoping you continue to get paid.
[SPEAKER_03]: It's kind of what private equity or private credit is.
[SPEAKER_03]: Let's go play two questions in a row right now.
[SPEAKER_05]: Hey, Justin, you're a loop.
[SPEAKER_05]: This is Andrew from Atlanta.
[SPEAKER_05]: I wanted to call you guys about zebra technologies.
[SPEAKER_05]: The ZBRA, I've been holding this for a while.
[SPEAKER_05]: If you could please tell me what your projections are for this stock.
[SPEAKER_05]: Greatly appreciate your help and I hope you have a good day.
[SPEAKER_05]: Thank you.
[SPEAKER_03]: Thank you so much.
[SPEAKER_03]: Looking at zebra technologies, ZBRA is the symbol.
[SPEAKER_03]: automatic identification and data capture products.
[SPEAKER_03]: Think of RFID chips that go on to products so that they can be easily scanned.
[SPEAKER_03]: And alternative to a bar code that can be scanned faster, just with a broad sensor.
[SPEAKER_03]: And this can be used in a lot of applications, manufacturing applications, et cetera.
[SPEAKER_03]: And so this is, I think, a very good business.
[SPEAKER_03]: It's down as of late, but I like the ecosystem they have built in earnings continue to go up, except they're in $20 per share next year, and it is a $200 stock.
[SPEAKER_03]: Pre-cashload 831 million, and that still is near and all time.
[SPEAKER_03]: Hi.
[SPEAKER_03]: So, I like that.
[SPEAKER_03]: I like their profitability, 11% return equity, not amazing, but certainly solid historically that's closer to the 20s with 30s.
[SPEAKER_03]: very minimal debt, only about two and a half billion dollars and net debt in their balance sheet and a mark half of 10 billion, certainly able to sustain that.
[SPEAKER_03]: And they're taking their cash flow and they're buying back shares in a material way.
[SPEAKER_03]: 2019, they had 54 million shares outstanding, they know they've got 49 million shares outstanding.
[SPEAKER_03]: So they've...
[SPEAKER_03]: Continue to buy back a couple percent of their shares every single year.
[SPEAKER_03]: No dividend yield, but I think this is that a very reasonable price nine and a half times and a price value either that which is the cheapest really it's ever been.
[SPEAKER_03]: The technicals are just okay, but I think if you have a long-term time horizon, I think this is a great value for zebra, zebra, CB, are they?
[SPEAKER_03]: Now next in Vestock, we'll look into the story, defense spending boom, military contractors hit the jackpot.
[SPEAKER_03]: We'll talk about that story tomorrow, but for now I'm Justin Klein and ready to take your calls now at 8.99 chart.
[SPEAKER_04]: There are a few things that make KPP financial special.
[SPEAKER_04]: One of them is parallel investing.
[SPEAKER_04]: This means they invest right alongside their clients.
[SPEAKER_04]: Here's how it works.
[SPEAKER_04]: When KPP financial makes a trade for their clients, just in client makes the same trade for himself and KPP.
[SPEAKER_04]: On the same day, at the same price, and same percentage.
[SPEAKER_04]: No French running, no special treatment.
[SPEAKER_04]: Learn more about Parallel Investing at Investalk.com.
[SPEAKER_03]: Our main focus point today is about the prediction markets, all the market as well as calcium, and how they're reshaping the way the financial world works.
[SPEAKER_03]: Every recently Arizona filed criminal charges against parent companies, calcium, accusing them of operating an illegal gambling business without a license.
[SPEAKER_03]: They said it was Arizona doesn't allow unlicensed wagering businesses and bands election bedding.
[SPEAKER_03]: They charged them with 20 counts of illegal bedding and wagering.
[SPEAKER_03]: Now the CFTC commissioner, Michael C. League, said, this is a jurisdiction dispute dispute and said entirely inappropriate as a criminal prosecution.
[SPEAKER_03]: Now both of these companies have been under scrutiny by bedding, allowing bedding on things like the invasion of Iran, the death of the IITOLA,
[SPEAKER_03]: But states, many states, Massachusetts, Michigan, Arizona, Iowa, Utah, so both red and blue states have pushed back and trying to ban these operations.
[SPEAKER_03]: And recently, the federal court rejected Calshy's attempt to prevent bands on its business in Ohio, Nevada.
[SPEAKER_03]: So this is the early days of this.
[SPEAKER_03]: And you can clearly see its impact
[SPEAKER_03]: Not necessarily on these companies, because they're not public, but on their competitors, like a draft kinks, draft kinks, peak that in February of last year, around $53 per share, now it's at $23.
[SPEAKER_03]: And clearly they're taking market share.
[SPEAKER_03]: So how will this evolve as the big question?
[SPEAKER_03]: And it goes back to one of those qualitative measurements that are very difficult.
[SPEAKER_03]: Everyone focuses on the numbers, but this is regulatory.
[SPEAKER_03]: How are federal agencies going to continue to handle this?
[SPEAKER_03]: Right now, because I believe one of President Trump's sons sits in the board of, I think it's a polymarket if I remember correctly, it might be calcium.
[SPEAKER_03]: and double-check me on that.
[SPEAKER_03]: On one of these, clearly that they're not going to do much to crack down on this business.
[SPEAKER_03]: But if, say there's new administration at some point, they're likely will be.
[SPEAKER_03]: that will probably flip in the other direction, and they'll start to crack down on the insider trading and these betting markets.
[SPEAKER_03]: So it's one of those things where you have to understand where we are from a regulatory standpoint today, and go with it, whether you like it or not, whether you love the insider trading that's going on here.
[SPEAKER_03]: betting on the invasion of Iran or bombing of Iran and all the other world events that you can bet on on Kashi, Kashi and Pauli market, whether you like that or not, it's clearly not going to change in the near term, which weighs on different areas of the financial markets.
[SPEAKER_03]: Ultimately, I think it's bad because I think it still pushes money to the top.
[SPEAKER_03]: It allows
[SPEAKER_03]: beyond just, you know, what happens within the equity markets.
[SPEAKER_03]: So it just expands that level of insider trading.
[SPEAKER_03]: I'm not a big fan of it, but I'm also cognizant that it's not going to change in the short term.
[SPEAKER_03]: But know that if you get a new administration, maybe you want to buy a draft index, knowing that CalShe and Polymarket may be correct on them.
[SPEAKER_03]: Let's go take a live call, Nick and Hayward wants to talk about Microsoft.
[SPEAKER_09]: Yeah, hi, just a good afternoon.
[SPEAKER_09]: Thanks for taking my call.
[SPEAKER_09]: Your thoughts on Microsoft.
[SPEAKER_09]: I own some already.
[SPEAKER_09]: And it seems like it's, you know, at a pretty good value when you compare 50 to the high and low.
[SPEAKER_09]: And I will get your thoughts about what you think about it.
[SPEAKER_09]: And I should have picked up some more.
[SPEAKER_09]: here are greatly a little bit more.
[SPEAKER_09]: What do you think?
[SPEAKER_09]: Thank you very much, sir.
[SPEAKER_03]: Thank you for the call it.
[SPEAKER_03]: Oh, I like Microsoft as a business.
[SPEAKER_03]: It certainly is one of those ones that has the ecosystem to both embrace AI and prevent AI from destroying its business.
[SPEAKER_03]: Now, that doesn't mean that it's not without its risk.
[SPEAKER_03]: It's certainly investing a lot in data centers.
[SPEAKER_03]: It is a hyper-scaler.
[SPEAKER_03]: But it has the consistency of Microsoft 365 clients and all of their other businesses that continue to do well, at least in the short term.
[SPEAKER_03]: In fact, earnings expectations continue to go up for this year and next year.
[SPEAKER_03]: So they're $19 per share next year on a $370 dollar stock.
[SPEAKER_03]: You're talking about a 20 times multiple now, which for Microsoft, it's a pretty reasonable.
[SPEAKER_03]: Multiple question is, is this low enough?
[SPEAKER_03]: Have we hit support from a technical perspective?
[SPEAKER_03]: And what I'll say is, we're getting there.
[SPEAKER_03]: So close around 372 today, and big support
[SPEAKER_03]: That's where I love to pick it up.
[SPEAKER_03]: So that's not that far away.
[SPEAKER_03]: You're talking about less than 10%.
[SPEAKER_03]: It could be selling puts maybe down around that level.
[SPEAKER_03]: It might be a good way to get in around 350.
[SPEAKER_03]: But ultimately, I still like it.
[SPEAKER_03]: There is that lack of buying back shares that is going to slow down their earnings growth.
[SPEAKER_03]: They're putting that money into AI data centers.
[SPEAKER_03]: And there's still a lot up in the air, whether that is going to be a net positive overall.
[SPEAKER_03]: But it's one of those names that can afford to do it.
[SPEAKER_03]: I'm like an Oracle who's free cash flows turn negative.
[SPEAKER_03]: Microsoft's free cash flow has dipped a little bit as of late, but only from 78 billion to 77.5 billion.
[SPEAKER_03]: So not a dramatic amount of shift.
[SPEAKER_03]: So I would continue to buy it, but I would probably be a bit more patient and buy it around 350.
[SPEAKER_03]: Thanks for the call.
[SPEAKER_03]: No, let's pivot back to another voicemail question now.
[SPEAKER_06]: Justin and Luke, this is Nick from New York, a long time listener.
[SPEAKER_06]: I just kind of had a question today about 401 slash 457.
[SPEAKER_06]: So what I was curious about is I happened to find or I have most of my money in a target dated fund through my employer.
[SPEAKER_06]: And, you know, the options and the profiles that you can select from just or not very diverse.
[SPEAKER_06]: So I was just curious, like, is there really anything that you can do?
[SPEAKER_06]: I'm 34 years old, would it be smart to say, take my money out?
[SPEAKER_06]: and put it somewhere else.
[SPEAKER_06]: But it sounds like that there's no real good way to do that without taking like a major tax beating.
[SPEAKER_06]: So am I kind of just like stuck in my account for a long period of time?
[SPEAKER_06]: I just I have 21 years left until I retire.
[SPEAKER_06]: Thank you for your help.
[SPEAKER_06]: I appreciate the advice.
[SPEAKER_06]: We'll be listening on the show.
[UNKNOWN]: Thanks.
[SPEAKER_03]: Well, if you ever move jobs, then that's when you roll that over into an IRA.
[SPEAKER_03]: Does number one?
[SPEAKER_03]: I don't know if you have any plans for that or not, but something you always want to have at the radar.
[SPEAKER_03]: That's kind of the upside of moving jobs.
[SPEAKER_03]: It's getting that money out of your 401k, 457, et cetera, and into an IRA where you have maximum flexibility.
[SPEAKER_03]: Does number one?
[SPEAKER_03]: Number two, a lot of 401k plans have the ability to opt into was called a self-directed brokerage account.
[SPEAKER_03]: They love and call it something different, but effectively that's what it is.
[SPEAKER_03]: It goes into, and account is usually a large broker, a fidelity or Schwab that is the custodian, and you get a login.
[SPEAKER_03]: That's what we have at the KPP for our clients.
[SPEAKER_03]: and it opts into fidelity and we have a fidelity login and it looks like a normal fidelity brokerage account, but it's a 401k.
[SPEAKER_03]: And now we can invest in whatever we want individual stocks, ETFs, other mutual funds, etc.
[SPEAKER_03]: So I would look into that potential with your 401k or 457.
[SPEAKER_03]: And if you don't have that opportunity, remember you are
[SPEAKER_03]: your HR department, your CFO, they have a fiduciary duty to you as the employer to put together a plan that's in your best interest.
[SPEAKER_03]: So if the options are too limited for you, if you're just have targeted funds and a couple of index funds, you can argue that that is not good enough.
[SPEAKER_03]: you need more options, you need better options.
[SPEAKER_03]: And so you want to go to them and say, either give me more mutual fun options, or give me a self-directed account that I can opt into and make trades, make individual, by individual securities.
[SPEAKER_03]: Thanks for the call.
[SPEAKER_03]: Let's go take a live call, Sammy and Sam Francisco looking at Google.
[SPEAKER_03]: Hey Justin, thank you for taking my call.
[SPEAKER_08]: Or shall I say, yeah, let's get to your, yeah, that's all for that.
[SPEAKER_08]: Yeah, we'd actually love to get you a point of view on the current price of alphabet.
[SPEAKER_08]: And do you think there's a good time to get in?
[SPEAKER_03]: Or should I wait?
[SPEAKER_03]: Well, Google is currently broke its uptrend.
[SPEAKER_03]: It's now below its 100-day moving average.
[SPEAKER_03]: And it's not at really major support quite yet.
[SPEAKER_03]: Let me give you a number.
[SPEAKER_03]: That's going to be around 270 to 70 right now.
[SPEAKER_03]: What do we close that to run 290 or 290?
[SPEAKER_03]: Yeah, so I think there's still some more downside in the near term.
[SPEAKER_03]: It's certainly not cheap, but it's to me it's one of the leaders.
[SPEAKER_03]: It's clear that Google and
[SPEAKER_03]: Google and Anthropic are leaning the pack in AI.
[SPEAKER_03]: They're kind of leaving open AI in the dust.
[SPEAKER_03]: And just kind of depends on what ecosystem you want.
[SPEAKER_03]: I think for the average consumer, the Gemini and Google ecosystem is a lot better, especially if you have a Gmail account, if you ever use Google Docs.
[SPEAKER_03]: And you're just kind of your simple everyday.
[SPEAKER_03]: Every day use case for AI, if you're going to operate with an ecosystem, a lot more effectively.
[SPEAKER_03]: First is business applications, more and more, because winning, and I think what's going to open AI, is well behind it.
[SPEAKER_03]: So I like that.
[SPEAKER_03]: I like their obviously their own waymo, parts of the own waymo, and that's certainly growing, so I think there's some
[SPEAKER_03]: Upside there as well.
[SPEAKER_03]: So I like what you're eyeing out where I and Google as well But we want to broader pullback like I said 270 is the first major support But 222 is where I would buy it kind of hand over fist So a lot will depend on what goes on with the broader market.
[SPEAKER_03]: You're seeing a sell-off in the mag seven tech names And Google's part of that
[SPEAKER_03]: And so if you get this broader down draft in the mag seven, re-rating these names lower, which Google is still trading at now about 30 times multiple.
[SPEAKER_03]: So that is 50% premium to a Microsoft.
[SPEAKER_03]: Is it much better than the Microsoft?
[SPEAKER_03]: That's, there's some good questions there.
[SPEAKER_03]: But ultimately, I would be buying it, but I'd be very, I'd be a bit patient.
[SPEAKER_03]: I'd be selling some puts actually down around the 270 to 50 level in that range, and that's where I'd be aggressively picking up the alphabet.
[SPEAKER_03]: Thank you.
[SPEAKER_03]: Thanks for the call.
[SPEAKER_03]: That was alphabet G, O, O, G. Let's go to another voicemail question now.
[SPEAKER_07]: I just don't look.
[SPEAKER_07]: And I was talking about back medicine mines, take a simple DNN to uranium exploration development company.
[SPEAKER_07]: They're operating out of Canada.
[SPEAKER_07]: Just one of your suits.
[SPEAKER_07]: You're thoughts over all the stock.
[SPEAKER_07]: And what you thought of it?
[SPEAKER_07]: Are you on a mobile mount?
[SPEAKER_07]: And what the recent tip I'm thinking about adding more.
[SPEAKER_07]: And I'm just
[SPEAKER_07]: I would like you to take that to your idea.
[SPEAKER_07]: Thanks.
[SPEAKER_03]: Looking at Denison mines, this is a small uranium miner, $3 billion market cap, but very little revenue.
[SPEAKER_03]: Last quarter, less than $1 million in a revenue.
[SPEAKER_03]: Once again, at a $3 billion company, lost money, expected to lose three cents this year, three cents last next year, it's a junior miner.
[SPEAKER_03]: I'm personally not a fan of the junior writers across any industry whether that's uranium, gold, silver, etc.
[SPEAKER_03]: But for trade, sure, because they're more sensitive.
[SPEAKER_03]: And if you're right that uranium stocks are going to go up or if you're investing in golden silver or copper, and you think those are going to go up, you're going to get the best bang for your buck the most
[SPEAKER_03]: in the junior miners.
[SPEAKER_03]: The names that have very little to no revenue.
[SPEAKER_03]: But that's pure speculation.
[SPEAKER_03]: If you want a hold for an extended period of time, you want the miners, once again, across any of the commodity verticals you're talking about, you want the names that actually have production, that produce profits that can take advantage when prices are higher and sell at those high prices and earn strong cash flows.
[SPEAKER_03]: that can be returned to you as dividends, or stock buybacks, et cetera.
[SPEAKER_03]: These junior miners, they tend to just issue more and more.
[SPEAKER_03]: Shares, deluding you, the shareholder, which means, over the long run, you are going to get deluded.
[SPEAKER_03]: And Denison is a good example of this.
[SPEAKER_03]: In 2021, they had about 800 million shares outstanding, and now they have about 900 million shares outstanding.
[SPEAKER_03]: So over the past five years, even deluded by about 10% of the sound dramatic, but you wanted to go the other way.
[SPEAKER_03]: Return to equity is negative.
[SPEAKER_03]: Freak Ashflow is negative.
[SPEAKER_03]: This is pure speculation.
[SPEAKER_03]: So nothing against Dennis and his, maybe one of the better genealogy miners out there.
[SPEAKER_03]: But I rather own the actual uranium miners that are producing profits in cashflow, focus on those.
[SPEAKER_03]: Those are Vestock, I'm Justin Klein with one goal each every week.
[SPEAKER_03]: They help you achieve your own version of Phantom Freedom and I work continues after this final break sketch questions in right now at 888-99 chart.
[SPEAKER_04]: Every investor is working to build a secure financial future.
[SPEAKER_04]: How they get there and when they get there, that depends on many factors.
[SPEAKER_04]: The more you learn about how the market works, the better your chances for success.
[SPEAKER_04]: So don't forget to call, in Vestark, 888-99 chart.
[SPEAKER_03]: One of the consistent themes that I've been talking about here in a Vest Talk for the last number of years is the fact that most investors are fighting the last war and for them the last war is 08 is that major decline in asset prices, both equities as and homes.
[SPEAKER_03]: The problem is that usually the next crisis is at the same as the previous crisis.
[SPEAKER_03]: and that the risk going forward is actually of an inflationary shock, versus a deflationary one.
[SPEAKER_03]: That was L8.
[SPEAKER_03]: But you're starting to see some parallels.
[SPEAKER_03]: Let me back up.
[SPEAKER_03]: Now that does not mean that an L8 crisis couldn't happen or won't happen, it just is less likely because everyone's focused on that.
[SPEAKER_03]: Usually what people are focused on that tends to surprise people.
[SPEAKER_03]: And what we had about an inflation was still, I think, are not worried about that part of the potential outcome, especially when you look at history, which is, you own your own currency, you print it, you create inflation.
[SPEAKER_03]: It's easier than a deflationary bust like a lead.
[SPEAKER_03]: So with that said, let's talk about some current parallels to the other way.
[SPEAKER_03]: And they were mounting losses in the subprime mortgage market.
[SPEAKER_03]: And this month, you saw prices spike, and we know there are problems in the private credit space.
[SPEAKER_03]: There's a lot of warning some regulators that private credit seems overheated.
[SPEAKER_03]: Banks like JP Morgan are reducing exposure to that area.
[SPEAKER_03]: And Jamie Diamond head of JP Morgan says there are cockroaches.
[SPEAKER_03]: And you've seen gating from many funds from Morgan Stanley, a Bat BlackRock to Blue Owl, et cetera, as people try to get their money out and are unable.
[SPEAKER_03]: And it's not just about their lending to the AI space, but you have
[SPEAKER_03]: Rehapothicating collateral, that means is that many of them are using the same collateral to make loans back by the same collateral, that's rehapothication.
[SPEAKER_03]: And so there's some, it's kind of a form of fraud.
[SPEAKER_03]: And so there's some issues on that front as well beyond just the AI lending sphere or the software lending space.
[SPEAKER_03]: And retail investors have been sold this by the big,
[SPEAKER_03]: broker chouses from Morgan Stanley, the Merrill Lynch, the Goldman Sachs, et cetera.
[SPEAKER_03]: That is this all add up to an O8 systemic shock, and the near term probably not.
[SPEAKER_03]: The first reason is that private credit is around $2 trillion in size.
[SPEAKER_03]: So it's fairly small, compared to two trillion sounds like a lot, but you're talking about a financial system that is hundreds of trillions.
[SPEAKER_03]: And then banks have much higher capital ratios.
[SPEAKER_03]: Right now, tier one capital is at 14.3%.
[SPEAKER_03]: Burses in 2000, that's less than 10% in 2011.
[SPEAKER_03]: And their share of high quality liquid assets and stable funding is up 55% and 40% respectively since those times.
[SPEAKER_03]: and with private equity, as you've seen, they're gating investors.
[SPEAKER_03]: So they don't need to re-value the assets in its timely manner, which in the shorter term, consistently shorter term, they just paper over those losses.
[SPEAKER_03]: And so it's more akin to a cancer that isn't killing you right away, than a sudden heart attack like we had to know it.
[SPEAKER_03]: So instead of a big bubble popping, it's more of a slow,
[SPEAKER_03]: hits.
[SPEAKER_03]: Now this doesn't mean you can't have some sort of major crisis and the longer this war goes on and we keep energy prices elevated, I think it could compound on itself.
[SPEAKER_03]: But ultimately the powers that be will likely print money and inflator way out of any issues that arise.
[SPEAKER_03]: I'm Justin Klein, and I remind you of Kate P. Financial's Parallel Investing, when we make a trade for our clients, we make the same trade for ourselves.
[SPEAKER_03]: Same day, same price, same percentage, no front running, no special treatment.
[SPEAKER_03]: We invest right alongside our clients.
[SPEAKER_03]: We show the same risks and potential for success.
[SPEAKER_03]: And you can learn more at investtalk.com.
[SPEAKER_03]: Please try your friends and family about a free podcast downloads if you find any time at iTunes, Spotify, or over on our YouTube channel as well.
[SPEAKER_03]: And head over to our YouTube channel for the latest in Vestock Market Madness updates.
[SPEAKER_03]: Independent thinking should success.
[SPEAKER_03]: This is Vestock, good name.
[SPEAKER_02]: Invest talk is a trademark of KPP financial, because of the nature of the interactive dialogue inherent in the format of this program.
[SPEAKER_02]: It's important for the listener to understand that not all comments may will apply to them.
[SPEAKER_02]: Specifically, nothing sets shall be taken to be investment advice, or shell statements on this program be considered and offered to buy or sell security.
[SPEAKER_02]: Because such advice is rendered solely on an individual basis, and at times,
[SPEAKER_02]: Invest talk is a copyrighted program of Plyne, Pavles, and Peasley Financial, a registered investment advisor firm, which retains all rights.
[SPEAKER_02]: For more information regarding KPP's investment advisors, call 1-800-557-5461.
[SPEAKER_02]: Thank you for listening, and your comments and questions are welcome on our 24-hour listener line at 888-99 chart.