00:04.100 --> 00:12.822 [SPEAKER_03]: On radio, on YouTube, streaming live on investtalk.com, and for our podcast subscribers, this is Invest Talk.

00:13.462 --> 00:15.823 [SPEAKER_03]: Independent Thinking, shared success.

00:17.843 --> 00:26.546 [SPEAKER_03]: Invest Talk is made possible by KPP Financial, a registered investment advisor firm, serving clients throughout the United States.

00:27.226 --> 00:31.927 [SPEAKER_03]: Here is KPP Financial Portfolio Manager, Luke Guerrero,

00:34.232 --> 00:37.933 [SPEAKER_00]: Good afternoon, fellow investors, and welcome back to Invest Talk.

00:38.933 --> 00:43.875 [SPEAKER_00]: I'm Guerrero, and today is Friday, July, twenty-fifth, twenty-five.

00:45.435 --> 00:54.118 [SPEAKER_00]: We made it through yet another week, the final full week of July, twenty-twenty-five, and things are quickly moving.

00:54.158 --> 01:00.420 [SPEAKER_00]: It seems as though the year just started yesterday, and I know I can't be alone in thinking that.

01:01.330 --> 01:06.993 [SPEAKER_00]: Talk about it with my friends, my family, all the time, the older we get, the quicker time seems to pass.

01:09.234 --> 01:14.176 [SPEAKER_00]: And with a backward-looking lens, things tend to make sense.

01:14.797 --> 01:16.297 [SPEAKER_00]: Hindsight is twenty-twenty.

01:16.878 --> 01:19.559 [SPEAKER_00]: Once you are where you are, you understand how you got there.

01:20.099 --> 01:23.261 [SPEAKER_00]: But part of investing is trying to figure out where we are going.

01:23.301 --> 01:28.884 [SPEAKER_00]: And so here at Invest Talk, we hope to illuminate that path just a little bit for you to help.

01:30.334 --> 01:43.023 [SPEAKER_00]: decipher some of the clues to filter out the noise to see what are the signals and most importantly to help make you a better and more educated investor.

01:45.605 --> 01:55.873 [SPEAKER_00]: Now as always we have a mix of educational and actual material to go over today but the most important part of this show is your finance and investment questions because we can't read minds

01:56.923 --> 02:00.145 [SPEAKER_00]: We need your help to understand what you care about.

02:00.165 --> 02:02.866 [SPEAKER_00]: And just a bit.

02:03.406 --> 02:04.947 [SPEAKER_00]: We'll talk about the market performance today.

02:05.007 --> 02:07.148 [SPEAKER_00]: Another positive day and week.

02:07.888 --> 02:09.669 [SPEAKER_00]: And run down those show topics we have for you.

02:09.709 --> 02:12.150 [SPEAKER_00]: But first, let's tackle this color question.

02:12.550 --> 02:16.352 [SPEAKER_02]: Hi, I work for a division owned by Legiting Flat LEG.

02:17.032 --> 02:20.754 [SPEAKER_02]: I'm wondering what you're thinking about their rising stock price recently.

02:21.493 --> 02:25.121 [SPEAKER_02]: It looks like a couple weeks ago they were up and then it took a dip.

02:25.562 --> 02:27.005 [SPEAKER_02]: Does this signal support?

02:27.386 --> 02:29.450 [SPEAKER_02]: My name is Ben at a California.

02:29.631 --> 02:29.971 [SPEAKER_02]: Thank you.

02:30.737 --> 02:36.642 [SPEAKER_00]: Alright Ben, so legant and plat ticker LEG is a diversified manufacturer.

02:36.662 --> 02:43.468 [SPEAKER_00]: They supply engineering components across consumer durable furniture and the automotive sector.

02:44.109 --> 02:50.675 [SPEAKER_00]: Bending products makes out about about forty percent of their business furniture and flooring makes up about thirty-two percent of their business.

02:51.275 --> 02:53.638 [SPEAKER_00]: And then the rest is a mixture of specialty products.

02:54.258 --> 03:01.463 [SPEAKER_00]: Now, if you look at this chart here, it shows the performance of, like, it in plat versus the S&P five hundred going back to twenty nineteen.

03:02.043 --> 03:21.197 [SPEAKER_00]: And you can see that they really didn't ever recover from a relative strength perspective from the pandemic started to go downward and then tracking and then there's this big divergence in twenty twenty one that continues in the big reason why is because revenue is really all over the place, but generally downward.

03:22.163 --> 03:25.426 [SPEAKER_00]: In December of twenty nineteen revenue is four point seven billion dollars.

03:26.407 --> 03:43.065 [SPEAKER_00]: This upcoming year projected to finish out at four point one five they lost money in twenty twenty three they lost money in twenty twenty four they're projected to be positive again but there's a lot of volatility here around earnings around margins and at the same time let's take a look at their balance sheet.

03:44.265 --> 03:46.065 [SPEAKER_00]: It is a one point three billion dollar company.

03:46.105 --> 03:49.506 [SPEAKER_00]: So the fact that it's a small cap is one of the reasons why it tends to be more volatile.

03:50.026 --> 03:53.527 [SPEAKER_00]: And they have two point one billion dollars in debt.

03:53.567 --> 03:56.768 [SPEAKER_00]: So a balance sheet that doesn't look very strong, either.

03:57.328 --> 04:03.989 [SPEAKER_00]: And even with the recent run up, up, forty one point seven percent in the past three months, right?

04:04.109 --> 04:11.851 [SPEAKER_00]: Because of some potential operating improvements that we've seen over the past couple months.

04:12.451 --> 04:13.491 [SPEAKER_00]: But regardless of that,

04:15.356 --> 04:18.557 [SPEAKER_00]: earnings really hasn't shown much positivity beyond estimates.

04:18.597 --> 04:25.160 [SPEAKER_00]: Q, one, twenty, twenty, five revenue, one point, two, billion down, six point eight percent year over year.

04:25.200 --> 04:30.042 [SPEAKER_00]: The profit trend isn't great and neither is the trend in cash flow.

04:30.702 --> 04:33.023 [SPEAKER_00]: And so that's why as you see in this stock, creep up.

04:33.903 --> 04:37.707 [SPEAKER_00]: You see short inches creep up as well, about seven percent short interest out there.

04:38.228 --> 04:40.910 [SPEAKER_00]: Decent amount of shorts, not a crazy amount of shorts.

04:41.511 --> 04:48.438 [SPEAKER_00]: But either way, I think the big two concerns here for me are balance sheet and profitability, both of which don't look very strong.

04:48.458 --> 04:52.842 [SPEAKER_00]: And that's why it's trading near its low over the past five years, well below.

04:53.523 --> 04:59.945 [SPEAKER_00]: It's average, a forward-looking price earnings, the average of being fortune point four, the current being eight point seven.

04:59.965 --> 05:09.729 [SPEAKER_00]: The other part of it as well, which I think is specific to you is you don't want to get too invested in the company in which you work because then you're income and your assets are tied to the same thing.

05:10.049 --> 05:11.310 [SPEAKER_00]: That's too high correlation here.

05:11.850 --> 05:19.673 [SPEAKER_00]: So this is a good example of why you probably don't want to be too heavily invested in the stock of the company for which you work either way.

05:20.553 --> 05:21.394 [SPEAKER_00]: They have a lot of problems.

05:22.054 --> 05:28.039 [SPEAKER_00]: Fast three months, things have slightly started to get better, but still not at a point in which I would want to allocate to this name.

05:28.540 --> 05:30.902 [SPEAKER_00]: That's Legit and Platt, take our LEG.

05:31.923 --> 05:41.911 [SPEAKER_00]: Call out a ground cover in the next forty-five minutes or so and our main focus point is a particularly important one for all of those out there including myself who don't want to overpay taxes.

05:42.411 --> 05:48.797 [SPEAKER_00]: And so we're going to talk about six clear signs you're overpaying on your taxes and how you can stop.

05:49.812 --> 05:53.034 [SPEAKER_00]: Many taxpayers unknowingly pay more than they owe.

05:53.554 --> 06:01.420 [SPEAKER_00]: With big tax refunds in correct filing status, missed deductions and poor withholding adjustments, we'll talk about all of that.

06:02.472 --> 06:11.894 [SPEAKER_00]: We'll also touch on how the tariffs thus far haven't really been paid so much by consumers in aggregate, but they have been paid primarily by U.S.

06:12.574 --> 06:13.114 [SPEAKER_00]: companies.

06:13.754 --> 06:14.474 [SPEAKER_00]: So we'll dive into that.

06:14.494 --> 06:19.655 [SPEAKER_00]: We certainly have gotten a lot of headlines from automakers and such about losses related to tariffs.

06:20.996 --> 06:22.396 [SPEAKER_00]: We'll also touch on the stock market.

06:23.016 --> 06:26.857 [SPEAKER_00]: It is headed upward and doesn't seem to stop.

06:28.050 --> 06:32.013 [SPEAKER_00]: It keeps breaking records, but that doesn't mean that it's all rosy out there.

06:32.594 --> 06:33.995 [SPEAKER_00]: And should we have time at the end of the show?

06:34.035 --> 06:37.317 [SPEAKER_00]: We'll touch on how the meme craze at two point I was back.

06:37.858 --> 06:44.083 [SPEAKER_00]: There's a funny, albeit slightly mean acronym for some of the stocks that people are tracking, but should we have time at the end?

06:44.103 --> 06:45.784 [SPEAKER_00]: We will dive into that story.

06:46.385 --> 06:54.951 [SPEAKER_00]: We also have some voice bank questions ready to play, including one on zebra technologies, ticker, ZBRA, and a general question about undervalued sectors.

06:55.672 --> 07:03.738 [SPEAKER_00]: As well as some questions that came in from the comment section of the Invest hoc YouTube, and hopefully some live questions from you throughout this show.

07:05.359 --> 07:06.560 [SPEAKER_00]: Are going to do a quick break?

07:06.660 --> 07:18.169 [SPEAKER_00]: Please remember you can call me anytime and leave your questions on the Invest hoc voice bank, or if you're listening live via the stream or an AM-Twelfth-Twenty in the Bay Area, give me a call now at eight and eight and ninety nine.

07:23.701 --> 07:25.763 [SPEAKER_06]: Okay, gotta get serious with my finances.

07:26.183 --> 07:31.868 [SPEAKER_06]: I've been working a long time and I know there's still gotta be more that I can do to build my wealth quicker.

07:31.888 --> 07:33.909 [SPEAKER_06]: I don't wanna have to work forever.

07:34.390 --> 07:40.655 [SPEAKER_01]: If you are not maximizing your employer's sponsor retirement plan, KPP Financial can help.

07:41.316 --> 07:49.682 [SPEAKER_01]: With our professional oversight, you can potentially enhance your investment performance by an average of three percent annually.

07:50.563 --> 07:58.746 [SPEAKER_01]: At KPP Financial, we provide a comprehensive four-of-one K-management program designed to optimize your retirement savings.

07:59.366 --> 08:06.069 [SPEAKER_01]: Our approach includes creating custom investment allocations tailored to your goals and risk tolerance.

08:06.569 --> 08:09.310 [SPEAKER_01]: That can make a big difference in your favor.

08:09.930 --> 08:12.534 [SPEAKER_06]: Maybe it's time to tune up my retirement plan.

08:12.874 --> 08:22.788 [SPEAKER_01]: For more information on how you can take control of your retirement savings, visit our website KPPFinancial.com KPPFinancial sounds good.

08:28.022 --> 08:35.944 [SPEAKER_05]: The Invest Talk phone lines never close, and now Luke Guerrero is here, taking your calls live.

08:36.605 --> 08:40.606 [SPEAKER_05]: Invest Talk, eight, eight, nine, nine, chart.

08:42.166 --> 08:48.028 [SPEAKER_00]: Eight, eight, nine, chart is the number if you want to get through live to me before the weekend.

08:48.508 --> 08:53.610 [SPEAKER_00]: Until we get a caller, let's talk about how the market performed this day and this week.

08:54.772 --> 09:06.761 [SPEAKER_00]: The Dow was up forty seven basis points on the day S&P five hundred up forty NASDAQ up twenty four Russell two thousand small caps up forty basis points as well.

09:08.302 --> 09:22.413 [SPEAKER_00]: And that was finishing pretty much near the best levels at which they were trading throughout the day causing the S&P and the NASDAQ to once again post fresh record closes up over one percent in the past five trading days.

09:23.305 --> 09:30.871 [SPEAKER_00]: On a sector basis, it looks like outperformers included apparel and accessory names, insurance, steel hotels, and casinos.

09:31.791 --> 09:36.615 [SPEAKER_00]: Big tech was mostly higher, Tesla, recouping some of yesterday's sharp decline.

09:37.335 --> 09:43.480 [SPEAKER_00]: In the underperformer, some eyes trying to text steel, media, regional banks, entertainments, and telecoms.

09:44.604 --> 09:51.469 [SPEAKER_00]: The bond side treasuries were a bit firmer, yields looked to be down one to three bases points at the back of the curve.

09:52.029 --> 10:02.017 [SPEAKER_00]: Dollar index up thirty bases points, gold finishing down one point one in crude oil, ending down as well down one point three percent on the day.

10:03.139 --> 10:04.920 [SPEAKER_00]: Not really much specific.

10:04.980 --> 10:08.083 [SPEAKER_00]: Nothing really specific behind the gains that we saw today.

10:08.603 --> 10:11.465 [SPEAKER_00]: Seems to be more the path of least resistance to the upside.

10:12.626 --> 10:19.010 [SPEAKER_00]: Kind of an easy excuse for why we'd continue to see the market marching higher because at the same time, right?

10:19.031 --> 10:20.091 [SPEAKER_00]: We're still in a waiting mode.

10:20.532 --> 10:28.798 [SPEAKER_00]: There's additional trade deal headlines to come as the approach gets closer and closer to that August first.

10:29.558 --> 10:33.361 [SPEAKER_00]: A deadline, two point out, a deadline, three point out, the reciprocal tariff deadline.

10:34.222 --> 10:36.564 [SPEAKER_00]: Much of the focus being on the EU, right?

10:36.584 --> 10:46.112 [SPEAKER_00]: We're getting some countries, uh, Japan, the Philippines, but it really doesn't matter much compared to China and the EU.

10:46.832 --> 10:49.755 [SPEAKER_00]: Some hoping we get just a fifteen percent tariff rate.

10:49.815 --> 10:58.222 [SPEAKER_00]: However, still on moving pieces, the president himself saying there's a fifty, fifty chance of a deal with the European Union.

10:59.363 --> 11:06.305 [SPEAKER_00]: Report noting some differences in interpretation as well from some of the trade deals that have already been announced.

11:06.365 --> 11:08.785 [SPEAKER_00]: One of the big points of the Japan U.S.

11:08.825 --> 11:17.507 [SPEAKER_00]: trade deal was around the profits that the President said would be going to the United States, five hundred and fifty billion in investment.

11:17.787 --> 11:21.908 [SPEAKER_00]: The Japan saying we're not really sure what you are talking about.

11:22.597 --> 11:31.424 [SPEAKER_00]: Now on the macro side, headline June durable good orders down nine point three percent month of a month following a sixteen and a half percent rise in May.

11:32.125 --> 11:42.153 [SPEAKER_00]: The orders x transports was up twenty percent month of a month and core orders dropped seventy basis points far lower than the twenty basis point consensus.

11:43.165 --> 11:47.707 [SPEAKER_00]: Looking ahead to next week, we have a pretty big week on the macro side.

11:48.388 --> 11:53.390 [SPEAKER_00]: We have the FOMC decision on Wednesday and the July Employment Report on Friday.

11:54.050 --> 11:59.013 [SPEAKER_00]: Next week also will bring the quarterly refunding announcement from the Treasury

11:59.953 --> 12:02.935 [SPEAKER_00]: And perhaps most importantly, because markets are forward looking.

12:02.975 --> 12:05.396 [SPEAKER_00]: They care most about earnings.

12:05.716 --> 12:14.061 [SPEAKER_00]: Well, nearly forty percent of the S&P five hundred's market cap is set to report Q to earnings next week, including Microsoft and meta.

12:14.561 --> 12:21.085 [SPEAKER_00]: Two names that have been spending a bunch of money on opx or rather capx related to AI investments.

12:22.623 --> 12:24.465 [SPEAKER_00]: And on the thirty of July after the close.

12:24.965 --> 12:28.208 [SPEAKER_00]: I'm sorry, I'm the thirty first of July, we'll get Huffle and Amazon.

12:28.688 --> 12:35.554 [SPEAKER_00]: All right, it looks like we got our first live call from Grace, who's listening on AM, twelve, twenty, was a question about in micro strategies.

12:35.614 --> 12:36.615 [SPEAKER_00]: You own it, you look in a bag.

12:37.096 --> 12:39.158 [SPEAKER_07]: Hi, thanks for taking my call.

12:39.338 --> 12:40.158 [SPEAKER_07]: I don't own it.

12:40.319 --> 12:46.404 [SPEAKER_07]: I'm kind of curious what you say about it because I know you guys don't like any stuff that's happening, I need that.

12:47.263 --> 12:48.364 [SPEAKER_07]: maybe with exceptions.

12:48.424 --> 12:49.784 [SPEAKER_07]: So what do you take on that?

12:49.844 --> 12:50.625 [SPEAKER_07]: Would you own it?

12:51.025 --> 12:54.747 [SPEAKER_07]: And if you do, what the price thanks you would answer.

12:55.287 --> 12:59.950 [SPEAKER_00]: Okay, so micro strategies is the company that is run by Michael Saler.

13:00.890 --> 13:04.072 [SPEAKER_00]: And it essentially just issues debt and equity to buy Bitcoin.

13:04.872 --> 13:10.315 [SPEAKER_00]: It holds two hundred thousand Bitcoin making its stock performance pretty highly correlated towards

13:11.455 --> 13:12.956 [SPEAKER_00]: the price of Bitcoin itself.

13:13.396 --> 13:22.220 [SPEAKER_00]: And so it issues the debt convertible notes, loans to fund those Bitcoin purchases, which increases the financial risk associated with micro strategies.

13:22.580 --> 13:30.524 [SPEAKER_00]: They also have charged different charges of ownership that pay various dividends that Michael Sailer himself said.

13:30.564 --> 13:33.005 [SPEAKER_00]: Well, at some point we may stop paying dividends just because

13:33.785 --> 13:37.266 [SPEAKER_00]: And so what this company is is it's not just a company that doesn't make money, right?

13:37.546 --> 13:42.667 [SPEAKER_00]: Sometimes people invest in companies that don't make money that are pre-revenue pre-profit.

13:43.187 --> 13:44.508 [SPEAKER_00]: This is a different situation here.

13:44.528 --> 13:46.268 [SPEAKER_00]: This is a financial engineering.

13:46.928 --> 14:03.132 [SPEAKER_00]: And so what you end up doing is you are actually paying a premium above the price of Bitcoin just to own something that is supposed to be correlated to Bitcoin because the thinking is the premium is associated with the financial engineering to buy additional Bitcoin.

14:04.012 --> 14:11.378 [SPEAKER_00]: It is predicated upon the demand for shares, continuing to be moving higher and higher.

14:12.839 --> 14:24.608 [SPEAKER_00]: In a way, older shareholders are only rewarded when newer shareholders purchase into it, giving them more capital to go out and buy more Bitcoin.

14:24.628 --> 14:27.090 [SPEAKER_00]: There's also a lot of regulatory issues right around Cape Town.

14:27.130 --> 14:29.032 [SPEAKER_00]: Certainly, those are starting to develop.

14:30.513 --> 14:35.956 [SPEAKER_00]: in a way that is more beneficial to the industry, then it was during the Biden administration.

14:35.976 --> 14:39.578 [SPEAKER_00]: So the regulatory side of it isn't as risky as well.

14:40.258 --> 14:48.322 [SPEAKER_00]: But the risk profile using that debt to buy Bitcoin is essentially a levered bet on Bitcoin plus the premium you have to pay.

14:48.362 --> 14:56.387 [SPEAKER_00]: And so my thinking behind it is if you want to be correlated to Bitcoin, then just buy Bitcoin.

14:57.233 --> 15:09.339 [SPEAKER_00]: Don't buy this financially engineered product, where shareholders constantly get diluted, debt constantly gets issued, and the leverage itself should we have a down cycle that we haven't had in a long time.

15:09.599 --> 15:16.302 [SPEAKER_00]: Remember, Bitcoin has never really been in existence during an actual recession, and that's when the leverage can come back to bite you.

15:16.342 --> 15:19.143 [SPEAKER_00]: So the core of it is, yes, it doesn't make money.

15:19.383 --> 15:20.744 [SPEAKER_00]: That's not my problem with this company.

15:21.084 --> 15:25.066 [SPEAKER_00]: If you want to buy own Bitcoin, if you want exposure to Bitcoin, just buy Bitcoin.

15:26.097 --> 15:29.079 [SPEAKER_00]: That is micro strategies, ticker, MSTR.

15:30.920 --> 15:32.080 [SPEAKER_00]: Moving to new breaks still to come.

15:32.100 --> 15:42.426 [SPEAKER_00]: A lot of things to talk about, including my main focus point, other stories, more questions, or newsletter this week, probably going to toss in a little promo for the Invest Talk store.

15:42.466 --> 15:43.346 [SPEAKER_00]: So keep on listening.

15:43.687 --> 15:44.507 [SPEAKER_00]: We'll see you after the break.

15:51.413 --> 15:54.194 [SPEAKER_05]: Have you heard about the new Invest Talk Store?

15:54.754 --> 15:58.415 [SPEAKER_05]: That's right, you'll find great merch for the savvy investor.

15:58.915 --> 16:02.576 [SPEAKER_05]: It's all there for you now at InvestTalkStore.com.

16:02.676 --> 16:09.378 [SPEAKER_05]: Luke Guerrero is here now, taking your finance and investment questions live.

16:09.958 --> 16:13.859 [SPEAKER_05]: Call Invest Talk, eight, eight, nine, nine, chart.

16:16.073 --> 16:24.003 [SPEAKER_00]: Now if you're like me or if you're like anybody, you don't want to be overpaying in taxes.

16:24.784 --> 16:25.405 [SPEAKER_00]: That's your money.

16:25.425 --> 16:30.571 [SPEAKER_00]: That's your hard earned money and although I am a firm believer in taxation because

16:31.626 --> 16:35.648 [SPEAKER_00]: There are many things we enjoy the benefits of, you know, like roads, water, electricity.

16:36.108 --> 16:39.750 [SPEAKER_00]: It doesn't mean I want to pay more than I am legally required to.

16:40.451 --> 16:51.577 [SPEAKER_00]: And so when you're thinking about that, here are six clear signs that you may be one of those people that is paying just a little bit or even a lot bit more than you need to.

16:52.177 --> 16:53.398 [SPEAKER_00]: In taxes, the first

16:54.618 --> 16:57.140 [SPEAKER_00]: is at the end of the year rather next year, right?

16:57.181 --> 16:58.221 [SPEAKER_00]: You file your taxes.

16:59.042 --> 17:03.246 [SPEAKER_00]: And you tell your girlfriend or your boyfriend or your husband and your wife, honey, I'm so excited.

17:04.267 --> 17:05.327 [SPEAKER_00]: I just got a big refund.

17:06.368 --> 17:10.412 [SPEAKER_00]: Well, the reality is is that a large refund means you overpaid the IRS throughout the year.

17:11.573 --> 17:16.897 [SPEAKER_00]: And essentially, you are giving the federal government an interest free loan.

17:17.923 --> 17:23.604 [SPEAKER_00]: And so if this happens year after year after year, how do you go about fixing it well?

17:24.365 --> 17:35.187 [SPEAKER_00]: You're going to want to adjust your W for with wholeings to increase your paycheck and use the money to pay debt to invest or to otherwise safe.

17:36.427 --> 17:38.148 [SPEAKER_00]: Another one, well, maybe

17:39.243 --> 17:43.347 [SPEAKER_00]: You are filing under the wrong status.

17:44.167 --> 17:45.629 [SPEAKER_00]: Are you a single parent?

17:46.309 --> 17:49.752 [SPEAKER_00]: And filing a single when instead you should be filing as head of household.

17:50.833 --> 17:55.697 [SPEAKER_00]: If you do that, this error is reducing your standard deduction and increasing your tax rate.

17:56.538 --> 17:58.980 [SPEAKER_00]: If you're one of those people who saying, oh gosh, Luke, you're right.

17:59.000 --> 18:00.081 [SPEAKER_00]: I've been doing this the whole time.

18:00.101 --> 18:05.126 [SPEAKER_00]: Well, you're going to want to work with a tax professional to ensure that you are selecting the most advantageous

18:06.957 --> 18:10.659 [SPEAKER_00]: Most advantageous status each and every year.

18:11.560 --> 18:16.563 [SPEAKER_00]: Now, all of us hopefully have some bit of saving, some investments.

18:18.204 --> 18:23.407 [SPEAKER_00]: And so are you just going about selling them without any strategy at all whatsoever?

18:24.808 --> 18:31.632 [SPEAKER_00]: If you are, you could be selling these investments and incurring gains and tax, therefore, taxes that you might not otherwise need to.

18:32.737 --> 18:37.741 [SPEAKER_00]: Short-term capital gains are taxed as a regular income up to thirty seven percent.

18:38.401 --> 18:44.545 [SPEAKER_00]: And investors often miss opportunities to do tax loss harvesting a Roth conversions during low income years.

18:45.586 --> 18:55.493 [SPEAKER_00]: That's what you need to fix it by always reviewing tax consequences with an advisor or a tax professional before selling or converting massive amounts of assets.

18:57.736 --> 18:59.837 [SPEAKER_00]: Now, if you have a brokerage account, that's great.

19:00.497 --> 19:04.639 [SPEAKER_00]: But, maybe the mistake you're making is ignoring tax advantage to accounts.

19:05.720 --> 19:22.307 [SPEAKER_00]: Contributing to your brokerage before maxing out your IRA, your four or one K, your HSA, leads to higher income taxes now and later, because you're missing out on tax benefits today and potentially tax benefits tomorrow as well.

19:22.347 --> 19:26.189 [SPEAKER_00]: And so, you're going to want to prioritize diversity.

19:27.520 --> 19:36.909 [SPEAKER_00]: Diversity not just in how you are allocating in your portfolio, but also diversity in how you are investing in various tax accounts.

19:38.350 --> 19:42.875 [SPEAKER_00]: Maybe you got a business, maybe you have a side hustle, and those have some levels of expenses.

19:44.544 --> 19:52.189 [SPEAKER_00]: Well, many people fail to track phone bills, supplies, mileage, home office use, gas related to those jobs.

19:52.749 --> 20:04.697 [SPEAKER_00]: And so if you fix it by documenting all the work related costs and consider opening a solo for a one K or a set IRA, you can help reduce the taxable income from that side business.

20:05.553 --> 20:08.476 [SPEAKER_00]: And lastly, is not working with a vetted tax professional.

20:09.457 --> 20:12.980 [SPEAKER_00]: Do it yourself tax filing, often misses the big savings opportunities.

20:13.341 --> 20:22.189 [SPEAKER_00]: Now, for most people who may have one job and a couple of investment accounts, do it yourself, can be the cheaper alternative, right?

20:22.230 --> 20:25.433 [SPEAKER_00]: Maybe you don't have a very complex tax situation.

20:25.773 --> 20:27.234 [SPEAKER_00]: But that's not the case for everyone.

20:27.875 --> 20:46.809 [SPEAKER_00]: So if your tax situation is a little more complicated, find a tax professional who understands your specific situation, meets with you quarterly or every half a year, and helps, excuse me, and helps create a tax that helps improve your tax situation for you specifically.

20:47.490 --> 20:54.155 [SPEAKER_00]: Avoiding these mistakes can keep thousands of dollars in your pocket each year without bending any of the rules.

20:55.864 --> 21:00.108 [SPEAKER_00]: It's like we all live call Elliott from Mountain Views, listening on AM-twelve-twenty.

21:00.769 --> 21:04.472 [SPEAKER_00]: Looks like you are going to ask about chimera investment corporation.

21:04.492 --> 21:04.893 [SPEAKER_00]: Do you own it?

21:04.913 --> 21:05.593 [SPEAKER_00]: Are you looking to buy it?

21:05.613 --> 21:10.758 [SPEAKER_02]: It's a stock called SAM-C-I-E-M.

21:11.158 --> 21:14.121 [SPEAKER_00]: A-Z-I-M, we heard C-I-M.

21:14.221 --> 21:15.663 [SPEAKER_00]: Okay, let's pull that one up instead.

21:19.481 --> 21:20.521 [SPEAKER_00]: Oh no, it's not a problem.

21:20.561 --> 21:26.045 [SPEAKER_00]: I'm sure you set it correctly and sometimes, you know, talking on the phone is makes it a little difficult to understand letters.

21:26.145 --> 21:32.048 [SPEAKER_00]: But I'm glad we got the right one here and we're looking at Zim, which is Zim integrated shipping services.

21:32.929 --> 21:36.030 [SPEAKER_00]: It is a shipping and logistics company.

21:36.050 --> 21:37.731 [SPEAKER_00]: It isn't Israeli company.

21:38.212 --> 21:43.235 [SPEAKER_00]: It's got a market cap of about one point nine billion dollars and its revenue is

21:43.975 --> 21:45.255 [SPEAKER_00]: really kind of all over the place.

21:45.315 --> 21:55.638 [SPEAKER_00]: It's very volatile as the shipping industry tends to be right from three point three billion in revenue in twenty and nineteen projected to be about seven billion this year.

21:55.678 --> 22:06.620 [SPEAKER_00]: Now there's a lot to dive into this company and certainly when we get back we'll talk about it more and take a look at if if it makes sense for Elliott or if it makes sense for any of you as well.

22:08.670 --> 22:14.614 [SPEAKER_00]: On the next invest talk, we'll look into this topic, seven financial considerations, wind downsizing for retirement.

22:15.255 --> 22:27.263 [SPEAKER_00]: Before downsizing in retirement, be sure to evaluate seven critical financial factors, including housing costs, estate inheritance taxes, social security, taxation, and more.

22:28.224 --> 22:33.887 [SPEAKER_00]: That's Monday, but for now, I'm Luca Raro and ready to take your calls at eight, eight, eight, nine chart.

22:50.496 --> 22:58.569 [SPEAKER_05]: The weekend is here or almost here, but you've got finance and investment questions, so step up and call in.

22:59.109 --> 22:59.871 [SPEAKER_05]: Invest talk.

23:04.152 --> 23:10.296 [SPEAKER_00]: Now, before the break, Elliot called in about ZIM, ZIM integrated shipping services.

23:10.336 --> 23:17.320 [SPEAKER_00]: We mentioned, say, one point nine billion dollar market cap company out of Israel that trades in his listed in the United States.

23:18.180 --> 23:22.583 [SPEAKER_00]: As I quite a bit of debt, five point eight billion dollars in debt.

23:23.470 --> 23:25.671 [SPEAKER_00]: Now, it's dividend yield right now.

23:25.751 --> 23:26.251 [SPEAKER_00]: Is that right?

23:26.291 --> 23:32.054 [SPEAKER_00]: It's sitting at about forty five point seven percent, which is never a good sign.

23:32.795 --> 23:42.380 [SPEAKER_00]: When there's a dividend yield that high, that's typically because the price has fallen pretty significantly down twenty two point zero eight percent year to day.

23:42.420 --> 23:52.485 [SPEAKER_00]: And that dividend yield is all over the darn place going back the past four years, hundred and fifty seven percent one year, five percent the other year.

23:53.105 --> 23:55.746 [SPEAKER_00]: Now, twenty-twenty-four was a decent year for this company.

23:55.786 --> 24:04.309 [SPEAKER_00]: You see that revenue growth from twenty-nineteen to twenty-twenty-two was, well, explosive coming out of the pandemic, and then really poor.

24:04.889 --> 24:09.651 [SPEAKER_00]: In twenty-twenty-three, dropping from twelve billion to five billion, they lost money in a big way.

24:09.751 --> 24:13.872 [SPEAKER_00]: Net margin was negative fifty-two point two percent, and there's been quite the turnaround, right?

24:13.892 --> 24:22.555 [SPEAKER_00]: That a huge financial turnaround, a large loss is with robust revenue growth, from five point one billion to eight point four billion.

24:23.538 --> 24:28.321 [SPEAKER_00]: Another dipping again, their net margins falling from twenty five down to five point three.

24:29.422 --> 24:38.127 [SPEAKER_00]: And the reason why is because while they're in an industry that is incredibly volatile, shipping rates are not looking great right now, shipping volumes are not looking great right now.

24:38.687 --> 24:45.772 [SPEAKER_00]: And so for a company that is currently five point eight billion dollars in debt with twenty percent short interest out there.

24:46.552 --> 25:06.507 [SPEAKER_00]: twenty percent short interest out there yes this is a name that can squeeze but the markets also signaling that this is a name that is very very risky because you have the company specific leverage and then you have the volatility of the industry as a whole and so certainly I don't think this is a good medium or long term hold at the moment

25:07.268 --> 25:18.677 [SPEAKER_00]: If you wanted to get into the shipping industry, I would look for something with far less leverage and an ability, therefore, to ease themselves in times when the cycle is just not in their favor.

25:19.417 --> 25:23.000 [SPEAKER_00]: That is, Zim integrated shipping services, ZIM.

25:23.660 --> 25:31.827 [SPEAKER_00]: That's Friday, so I want to briefly mention the newest KPP premium newsletter, which will be distributed on Saturday, which is tomorrow.

25:32.587 --> 25:40.774 [SPEAKER_00]: And the KPP inside section, where we generally like to go over the current market or a topic, they really just do a little deep dive into something that is interesting.

25:41.595 --> 25:53.065 [SPEAKER_00]: We talk about the auto industry where it's been where it's going, why do Justin and I always say that running a car business is like the worst kind of business to run and one of the worst investments you can make, well talk about all those things.

25:53.766 --> 25:57.689 [SPEAKER_00]: In the stock idea section, we mentioned the world's largest

25:58.858 --> 26:09.449 [SPEAKER_00]: animal health care company and a diagnostic testing and drug development company and the portfolio management section we touched on growth stocks compared to that value stocks.

26:10.791 --> 26:11.592 [SPEAKER_00]: What are the differences?

26:12.452 --> 26:14.334 [SPEAKER_00]: How do you know what to look for?

26:15.275 --> 26:17.378 [SPEAKER_00]: What are the benefits of holding each?

26:19.180 --> 26:20.741 [SPEAKER_00]: Those things sound interesting to you.

26:20.801 --> 26:26.004 [SPEAKER_00]: Feel free to head over to invest sock.com and hit subscribe on our newsletter.

26:26.544 --> 26:29.966 [SPEAKER_00]: The newsletter will come to your inbox on Saturday mornings.

26:30.947 --> 26:38.731 [SPEAKER_00]: One other thing we'd like to do on Friday is make a little bit of time to fit in a quick run-down of key benchmark numbers.

26:38.771 --> 26:40.592 [SPEAKER_00]: So let's go with that list right now.

26:42.032 --> 26:47.614 [SPEAKER_00]: The two year treasury yield was at three point nine, one nine percent today for prospective last week.

26:48.094 --> 26:57.198 [SPEAKER_00]: The number was three point eight six one and one hundred and eighty six weeks ago, which is about three and a half years, it was point six for percent.

26:58.164 --> 27:04.233 [SPEAKER_00]: The ten year treasure yield was at four point three eight eight percent last week that was four point four to one.

27:05.094 --> 27:11.464 [SPEAKER_00]: Fifty weeks ago that was three point nine to one and a hundred and eighty four weeks ago to get about three and a half years.

27:12.065 --> 27:14.067 [SPEAKER_00]: That number was one point seven six two.

27:15.335 --> 27:35.616 [SPEAKER_00]: Gold was priced at three thousand three hundred and thirty two dollars per ounce today one dollar away from closing at thirty three thirty three which is a big bummer also a nineteen dollar decrease compared with last week eighty nine weeks back it was nineteen thirty five when we all wish we had bought a bunch of gold ninety seventy eight weeks ago it was eighteen oh six

27:36.891 --> 28:01.134 [SPEAKER_00]: Silver was priced at thirty eight dollars and nineteen cents per ounce a five cent decrease compared to last week seventy six weeks ago was twenty two eighty and looking back a hundred and seventy weeks silver was twenty three ninety four oil was selling for sixty five forty eight per barrel today that is a one dollar and ninety three cent decrease compared to last week

28:25.006 --> 28:34.284 [SPEAKER_00]: A hundred six hundred sixty weeks back then I was four twenty five and looking all the way back three and a half years that number was three dollars and fifty seven cents.

28:35.918 --> 28:45.021 [SPEAKER_00]: In California, it was averaging four dollars and forty seven cents per gallon for a gallon of gasoline, two cents lower than the same than that gallon last week.

28:45.961 --> 28:49.763 [SPEAKER_00]: Ninety weeks go that number was five thirty two and a hundred and sixty six weeks back.

28:49.803 --> 28:51.263 [SPEAKER_00]: It was five eighty seven.

28:51.983 --> 29:02.087 [SPEAKER_00]: For comparison in North Carolina, gas is averaging two dollars and eighty nine cents per gallon today that is one dollar and fifty eight cents less than gas in California.

29:04.173 --> 29:10.282 [SPEAKER_00]: All right, let's keep things moving ahead back to the anytime listener line of voice bank and tackle this question.

29:11.523 --> 29:14.587 [SPEAKER_08]: Hey, Luke and Justin is a Jake from the Bay Area.

29:14.608 --> 29:21.357 [SPEAKER_08]: I'm going to be able to do some rebalancing and I'm looking to get a little bit more cash from the sidelines.

29:21.817 --> 29:26.639 [SPEAKER_08]: I was just wondering, what percentage of my portfolio should I hold in cash?

29:27.299 --> 29:31.821 [SPEAKER_08]: And what areas of the market do you feel like are undervalued currently?

29:31.861 --> 29:37.983 [SPEAKER_08]: It does seem like most of the market is overvalued, doesn't seem like there's a lot of deals out there right now.

29:38.503 --> 29:42.485 [SPEAKER_08]: Trying to get your thoughts on where those undervalued sectors might be.

29:42.845 --> 29:43.345 [SPEAKER_08]: Alright, thank you.

29:44.765 --> 29:45.466 [SPEAKER_00]: It's great question.

29:45.546 --> 29:51.713 [SPEAKER_00]: So oftentimes, we move into a situation where a lot of our investments have done well, hopefully.

29:52.393 --> 29:59.201 [SPEAKER_00]: We want to exit some of those positions, take some gains, and we're left with cash that either we reinvest immediately or leave on the sidelines.

29:59.601 --> 30:03.325 [SPEAKER_00]: Now to answer the first part of your question, how much cash is the right amount?

30:03.966 --> 30:04.867 [SPEAKER_00]: There is no right amount.

30:04.907 --> 30:06.448 [SPEAKER_00]: That's incredibly person-specific.

30:07.069 --> 30:08.530 [SPEAKER_00]: What are you using this money for?

30:09.030 --> 30:09.991 [SPEAKER_00]: How old are you?

30:10.411 --> 30:12.052 [SPEAKER_00]: How much risk are you willing to take on?

30:12.152 --> 30:14.554 [SPEAKER_00]: For a lot of people, four and a half percent sounds pretty juicy.

30:15.114 --> 30:17.376 [SPEAKER_00]: You know, four point two percent sounds pretty juicy.

30:17.396 --> 30:21.358 [SPEAKER_00]: And so they're willing to hold on more cash, especially at a time they think the market is overvalued.

30:22.059 --> 30:26.722 [SPEAKER_00]: For other people, well, they have long, long investment horizons, and they don't want to hold on too as much cash.

30:26.742 --> 30:35.408 [SPEAKER_00]: But if you try to strategically reenter the market, having your cash in a money market fund or a short-term treasury fund can certainly be a good way to go in the interim.

30:36.645 --> 30:37.886 [SPEAKER_00]: Now, in terms of sectors, right?

30:37.926 --> 30:43.068 [SPEAKER_00]: Because one thing that we've seen is a huge run-up in the top line indices.

30:43.588 --> 30:48.890 [SPEAKER_00]: But when you dive in, there is some pretty wide dispersion of performance.

30:49.690 --> 30:55.353 [SPEAKER_00]: A handful of names have really driven the market higher over the past couple years.

30:55.413 --> 31:00.375 [SPEAKER_00]: And so there are some sectors that are undervalued relative to

31:01.335 --> 31:05.297 [SPEAKER_00]: what we see in the index overall health care is one of them.

31:05.737 --> 31:14.021 [SPEAKER_00]: Training it's sixteen to eighteen percent or sixteen to eighteen times rather for looking earnings well below the S&P which is above twenty two at this point.

31:14.701 --> 31:20.584 [SPEAKER_00]: Making it, you know, one of the cheapest it has been relative to the S&P in quite some time.

31:21.164 --> 31:23.846 [SPEAKER_00]: You also have energy stocks that aren't doing particularly well.

31:24.007 --> 31:24.287 [SPEAKER_00]: Why?

31:24.367 --> 31:26.089 [SPEAKER_00]: Well, we just went over well pricing.

31:26.589 --> 31:28.230 [SPEAKER_00]: And so yes, uranium's doing well.

31:28.311 --> 31:33.976 [SPEAKER_00]: Natural gas is having some issues because it's going to supposedly supposed to be particularly warm winter.

31:34.296 --> 31:35.257 [SPEAKER_00]: Demand is down.

31:36.618 --> 31:52.387 [SPEAKER_00]: You know, and so given that, if you're looking for a long-term allocation to energy, now can be a pretty solid time to do it for looking valuations and financials are looking pretty decent right now, especially if you're looking for income and yield.

31:52.947 --> 31:58.230 [SPEAKER_00]: And so just because, you know, we're reaching record high, record high, record high.

31:58.270 --> 32:02.313 [SPEAKER_00]: And the S&P itself is very expensive about a forward looking multiple.

32:02.333 --> 32:05.535 [SPEAKER_00]: And the Buffet indicator is through the gosh darn roof,

32:06.475 --> 32:10.517 [SPEAKER_00]: doesn't necessarily mean there aren't opportunities out there.

32:10.557 --> 32:18.662 [SPEAKER_00]: And so diving deep in understanding what is driving the market as a whole can help you find these sectors where there are some pretty good opportunities.

32:19.422 --> 32:20.203 [SPEAKER_00]: Thanks for the call.

32:22.964 --> 32:25.506 [SPEAKER_00]: Let's talk tariffs.

32:27.086 --> 32:30.248 [SPEAKER_00]: Fifty-five billion in new tariffs have been collected in

32:32.286 --> 32:36.589 [SPEAKER_00]: pushing US tariff levels to multi-decade highs.

32:37.510 --> 32:38.631 [SPEAKER_00]: And so who's paying them?

32:38.951 --> 32:41.173 [SPEAKER_00]: Well, it's not the country on which they're imposed.

32:41.193 --> 32:42.094 [SPEAKER_00]: That's not how tariffs work.

32:44.020 --> 32:47.861 [SPEAKER_00]: And thus far it hasn't really been consumers.

32:48.681 --> 32:56.843 [SPEAKER_00]: Thus far, US businesses are absorbing most of the burden pretty reluctant to pass on those costs due to competitive pressures.

32:57.304 --> 33:05.906 [SPEAKER_00]: And then certainly about the level is actually going to be tomorrow in the next day, next month, let alone next year, only twenty percent of costs.

33:06.386 --> 33:08.509 [SPEAKER_00]: are being offset by foreign suppliers right now.

33:08.529 --> 33:11.754 [SPEAKER_00]: And it's not because foreign suppliers are paying the tariffs themselves.

33:12.174 --> 33:19.865 [SPEAKER_00]: They're saying to those businesses, okay, we're going to give you temporary discounts such that the cost you're paying to import is the same.

33:20.526 --> 33:21.607 [SPEAKER_00]: So they're taking a loss.

33:23.195 --> 33:26.319 [SPEAKER_00]: And they add what they're selling it for plus the tariff.

33:26.339 --> 33:27.941 [SPEAKER_00]: And the price is the same for the businesses right now.

33:27.981 --> 33:29.223 [SPEAKER_00]: Now that's not sustainable.

33:29.824 --> 33:40.097 [SPEAKER_00]: But given that we don't know if this is a short term thing or a long term thing, some of the importers are willing to try and work things out for businesses.

33:42.247 --> 33:45.530 [SPEAKER_00]: But even in spite of that, inflation is creeping up on tariff goods.

33:45.970 --> 33:54.557 [SPEAKER_00]: June CPI rose to point seven percent year over year from two point four in May, especially in select areas, furniture, toys, clothing.

33:55.137 --> 33:59.040 [SPEAKER_00]: Corporate profits, which I already mentioned earlier in the week mentioned today.

33:59.501 --> 34:01.122 [SPEAKER_00]: You know, you look at some of these car makers.

34:01.482 --> 34:02.543 [SPEAKER_00]: Corporate profits have taken a hit.

34:02.583 --> 34:04.505 [SPEAKER_00]: GM paid one billion dollars.

34:05.125 --> 34:06.066 [SPEAKER_00]: in Tariff's in Q-T.

34:06.106 --> 34:09.248 [SPEAKER_00]: Solantus lost three hundred and fifty million dollars.

34:09.328 --> 34:14.852 [SPEAKER_00]: Nike expects a billion dollar profit reduction this fiscal year.

34:15.392 --> 34:20.756 [SPEAKER_00]: And you can say, okay, better than me, but as investors, that trickles down to us.

34:23.378 --> 34:27.341 [SPEAKER_00]: If companies are having to pay more, that means profits are less.

34:28.538 --> 34:34.045 [SPEAKER_00]: That means if you think the market's over value now, wait until you find out how over value it can possibly be.

34:34.365 --> 34:42.035 [SPEAKER_00]: Companies are trying to delay price hikes that relying on cost cutting supplier changes inventory stockpiling, but they can't do it forever.

34:42.155 --> 34:44.097 [SPEAKER_00]: Increases are going to come.

34:44.838 --> 34:49.259 [SPEAKER_00]: Retail giants like Walmart are taking a more surgical approach.

34:49.999 --> 34:54.640 [SPEAKER_00]: Bananas now cost about ten percent more than they did before tariffs.

34:54.720 --> 34:56.700 [SPEAKER_00]: Barbecue pit inventories have been trimmed.

34:56.960 --> 35:00.841 [SPEAKER_00]: They're taking a look at certain products and saying, OK, we can charge more here.

35:00.881 --> 35:01.781 [SPEAKER_00]: We can charge more there.

35:01.821 --> 35:05.182 [SPEAKER_00]: This is the highest area in which our costs have increased.

35:06.702 --> 35:07.263 [SPEAKER_00]: But here's the thing.

35:07.923 --> 35:08.683 [SPEAKER_00]: Not everyone can do that.

35:08.903 --> 35:09.803 [SPEAKER_00]: Not everybody's Nike.

35:09.843 --> 35:10.783 [SPEAKER_00]: Not everyone's GM.

35:11.383 --> 35:14.084 [SPEAKER_00]: Not everybody can shrug off a billion dollars lost to tariffs.

35:15.282 --> 35:19.684 [SPEAKER_00]: Not everybody can lobby you the White House to get a deal on what they're trying to import.

35:19.804 --> 35:21.624 [SPEAKER_00]: Small businesses are who I'm talking about.

35:22.225 --> 35:27.767 [SPEAKER_00]: Far more vulnerable, you're niche retailers who are forced to raise prices or cut product lines to survive.

35:28.247 --> 35:30.408 [SPEAKER_00]: Your local businesses, your local florists.

35:31.908 --> 35:35.770 [SPEAKER_00]: The effective average US tariff rate is now seventeen percent.

35:37.450 --> 35:40.672 [SPEAKER_00]: We loved to look at key benchmark numbers from way back when.

35:40.812 --> 35:43.513 [SPEAKER_00]: So let's look a year ago that I was two point three percent.

35:44.498 --> 35:50.243 [SPEAKER_00]: Now there is some potential clarity from these deals that we've gotten from Japan is a big trading partner of ours.

35:51.104 --> 35:53.446 [SPEAKER_00]: Some of the other ones don't really matter as much, right?

35:53.466 --> 35:56.969 [SPEAKER_00]: We're not importing much from some of the countries that have reached a deal.

35:58.510 --> 36:01.893 [SPEAKER_00]: The ones that really matter are, well, look to the north, look to the south.

36:03.314 --> 36:08.138 [SPEAKER_00]: We already may see the USMCA, which Trump negotiated in term one, be renegotiated in term two.

36:08.218 --> 36:09.199 [SPEAKER_00]: Japan certainly matters.

36:09.219 --> 36:11.181 [SPEAKER_00]: The European Union certainly matters in the big ones, China.

36:12.215 --> 36:16.538 [SPEAKER_00]: The reality is, tariff fatigue is setting it.

36:16.678 --> 36:26.126 [SPEAKER_00]: Not just because I don't want to talk about it or it's something we, as financial professionals, think about and talk about all the time, I'm getting tired of it.

36:26.506 --> 36:33.692 [SPEAKER_00]: But businesses are too companies are warning, listen, we've been absorbing this for now, but we can't absorb costs forever.

36:34.890 --> 36:52.184 [SPEAKER_00]: And so unless something changes in the coming months, expect to see CPI increase, expect to see inflation increase, expect to see a Fed who is more hampered with an ability to cut that affects you everywhere, not just at the grocery store, but your mortgage everything down the line.

36:52.704 --> 37:00.030 [SPEAKER_00]: All righty, well, if you are a viewer and a listener or a listener, you may know that we are available on YouTube.

37:01.715 --> 37:09.359 [SPEAKER_00]: And while you're over there, if you leave a question, we'd like to get to those as quickly as we possibly can, so let's at least try and start one right now.

37:10.080 --> 37:16.063 [SPEAKER_00]: This question is on ticker ALE, which is elite, spelled ALE, ETE, energy.

37:16.783 --> 37:17.944 [SPEAKER_00]: It says, can you give me an update?

37:18.384 --> 37:22.667 [SPEAKER_00]: I'm a shareholder and was informed nearly a year ago that it was part of a merger, and we'll be paid out.

37:24.142 --> 37:33.851 [SPEAKER_00]: But sixty seven dollars per share, however, I have been unable, I believe, as it says, to find an actual date when it will happen.

37:34.811 --> 37:38.755 [SPEAKER_00]: Take a look and see if we can find this date for you.

37:41.482 --> 37:42.883 [SPEAKER_00]: Either way, let's get a high level here.

37:43.063 --> 37:49.347 [SPEAKER_00]: So this is a company that engages in the provision of electric and natural gas utility services.

37:49.947 --> 37:54.530 [SPEAKER_00]: Click in May of twenty twenty four, they agreed to be acquired for sixty seven dollars.

37:55.070 --> 38:09.899 [SPEAKER_00]: A share shareholder's approved the transaction in August and regulatory approvals have come from with constant authorities as well as FERC but the Minnesota Public Utilities Commission or MPUC approval is still pending.

38:10.619 --> 38:23.626 [SPEAKER_00]: And so the company itself is saying they expect the merger to be finished in mid-twenty-twenty-five, though it is possible that they will see some continued delays beyond when they expected which was August fifth.

38:23.706 --> 38:27.208 [SPEAKER_00]: The reality is that sometimes these things take time.

38:28.529 --> 38:30.370 [SPEAKER_00]: And it's not just about the company boards approving.

38:31.130 --> 38:34.132 [SPEAKER_00]: It's also about the regulatory authorities approving themselves.

38:34.172 --> 38:34.712 [SPEAKER_00]: I will say this.

38:34.732 --> 38:35.413 [SPEAKER_00]: Here's a lesson here.

38:36.691 --> 38:42.234 [SPEAKER_00]: If your stock is being bought for sixty-seven dollars a share, it should be essentially paid to sixty-seven dollars a share.

38:43.034 --> 38:44.655 [SPEAKER_00]: You see the price of sixty-five eighty-seven?

38:44.695 --> 38:46.016 [SPEAKER_00]: That's a little bit below sixty-seven.

38:46.656 --> 38:51.679 [SPEAKER_00]: If you own a stock that is an all cash merger and it's trading at the cash price, sell the stock.

38:52.119 --> 38:53.640 [SPEAKER_00]: You're no longer holding an equity.

38:53.660 --> 38:54.641 [SPEAKER_00]: You're holding cash.

38:56.942 --> 38:57.442 [SPEAKER_00]: Get your money.

38:57.963 --> 38:58.483 [SPEAKER_00]: Put it elsewhere.

39:00.394 --> 39:01.115 [SPEAKER_00]: This is Invest Talk.

39:01.376 --> 39:01.916 [SPEAKER_00]: I'm LeGrear.

39:01.956 --> 39:05.001 [SPEAKER_00]: We have one goal here to help you achieve your financial freedom.

39:05.762 --> 39:07.846 [SPEAKER_00]: Our work continues after our final break.

39:07.886 --> 39:12.092 [SPEAKER_00]: So get your questions in now at eight, eight, eight, ninety nine chart.

39:25.540 --> 39:30.644 [SPEAKER_05]: Every investor is working to build a secure financial future.

39:31.145 --> 39:36.629 [SPEAKER_05]: The more you learn about how the market works, the better your chances for success.

39:37.310 --> 39:40.852 [SPEAKER_05]: In Vestark, eight, eight, nine, chart.

39:41.153 --> 39:52.462 [SPEAKER_04]: This is Art from Tucson, and I am calling about zebra technologies, corporation, ZBRAA, wondering where would be a good time to buy it?

39:52.978 --> 39:53.898 [SPEAKER_04]: Well, we're price.

39:54.558 --> 39:55.919 [SPEAKER_04]: I'll listen on the podcast.

39:56.339 --> 39:57.439 [SPEAKER_04]: Thanks for all you do for us.

39:58.219 --> 40:04.600 [SPEAKER_00]: Let's take a look at Zebra Technology's Corporation that is ticker ZBRA.

40:04.660 --> 40:10.441 [SPEAKER_00]: It designs manufacturers and sells automatic identification and data capture products.

40:11.121 --> 40:13.642 [SPEAKER_00]: It is a leader in an enterprise data capture.

40:13.862 --> 40:18.963 [SPEAKER_00]: And so it serves industry, such as retail, healthcare, logistics, and manufacturing.

40:19.783 --> 40:27.545 [SPEAKER_00]: They help frontline workers as well as just working through integrating systems across the board.

40:28.286 --> 40:38.569 [SPEAKER_00]: Now, you're today, it's down about thirteen point zero eight percent, yet it's still up thirty six point three three percent in the past three months, meaning starting the year in a pretty rough position.

40:39.895 --> 40:56.567 [SPEAKER_00]: Revenue has slowed in terms of its growth only about two point three percent on an annualized basis over the past five years yet margins are kind of improving right they were about eight point one and six point four and twenty twenty twenty twenty three projected to be ten point three percent this year.

40:57.127 --> 41:03.431 [SPEAKER_00]: Now the past three months have been okay for this before for the performance of this stock right up thirty six percent so pretty good.

41:04.292 --> 41:08.136 [SPEAKER_00]: One of the reasons why is improving earnings.

41:08.857 --> 41:14.463 [SPEAKER_00]: You had some pretty solid earnings reports in Q-One and Q-Two which exceeded expectations.

41:14.483 --> 41:15.805 [SPEAKER_00]: You had improved growth.

41:15.825 --> 41:18.288 [SPEAKER_00]: You had restructuring which cut operational expenses.

41:18.328 --> 41:22.713 [SPEAKER_00]: That's one of the reasons why you're seeing these margins that improve the way you are.

41:24.290 --> 41:34.018 [SPEAKER_00]: Now, it is a fairly large company, right, seventeen billion dollar market capital, about two point two billion dollars in debts, with almost a billion dollars in cash.

41:34.058 --> 41:37.181 [SPEAKER_00]: So really not that much debt in terms of leverage on its balance sheet.

41:37.901 --> 41:39.303 [SPEAKER_00]: Still, over the past five years.

41:40.808 --> 41:41.468 [SPEAKER_00]: I've got a rough, right?

41:41.488 --> 41:47.051 [SPEAKER_00]: Profitability is headed back in the right direction, but there was a consistent downward trend, same with cash flow.

41:47.511 --> 41:51.452 [SPEAKER_00]: And so all of this has moved it into a little bit more reasonable of a pricing range here.

41:51.472 --> 41:55.534 [SPEAKER_00]: Twenty one point one times forward looking earnings.

41:55.974 --> 41:58.655 [SPEAKER_00]: This seems to be a company that is still recovering.

41:58.695 --> 42:03.137 [SPEAKER_00]: It's recovering from a cautious demand.

42:03.738 --> 42:06.419 [SPEAKER_00]: It's business model, which is the hardware plus software.

42:07.219 --> 42:17.743 [SPEAKER_00]: right, integrated systems, integrated operations, works well yet it's tied to each other in such a way that revenue can be pretty volatile and that's what you see with revenue.

42:17.783 --> 42:18.564 [SPEAKER_00]: It is rather volatile.

42:18.584 --> 42:23.446 [SPEAKER_00]: You're not saying huge swings, but percentage-wise you are seeing some pretty decent swings here.

42:24.106 --> 42:26.627 [SPEAKER_00]: I think the bottom line is the company has rebounded.

42:27.007 --> 42:35.931 [SPEAKER_00]: It's rebounded pretty well, I would say, but, you know, any time you're seeing a little bit of a turnaround, which you did start to see towards

42:37.005 --> 42:40.366 [SPEAKER_00]: The fourth quarter of last year, you want to see some follow-through here.

42:40.826 --> 42:43.887 [SPEAKER_00]: Now, this is the warning I give often times when we're approaching earnings.

42:44.247 --> 42:49.868 [SPEAKER_00]: Historically speaking, your returns, expected to turn, tend to be negative when you're within two weeks of earnings.

42:49.948 --> 42:51.728 [SPEAKER_00]: We are two weeks-ish.

42:52.229 --> 42:54.129 [SPEAKER_00]: We can have away from earnings now.

42:54.609 --> 42:56.209 [SPEAKER_00]: I would keep it on my watch list for now.

42:56.250 --> 42:57.590 [SPEAKER_00]: It doesn't mean it's not going to be.

42:57.630 --> 42:59.410 [SPEAKER_00]: It doesn't mean the prices are going to jump up.

42:59.430 --> 43:03.011 [SPEAKER_00]: It just means it's a heightened time of volatility and a heightened time of risk.

43:03.471 --> 43:06.892 [SPEAKER_00]: That is, it ticker ZBRA Zebra Technologies Corporation.

43:08.273 --> 43:15.757 [SPEAKER_00]: All right, I want to talk about the last thing quickly, because that is there's a new acronym in town, Dork, Crispy Cream.

43:17.410 --> 43:23.333 [SPEAKER_00]: It's for ticker DN UT, OPEN, RKT, and KSS.

43:23.834 --> 43:30.577 [SPEAKER_00]: For meme socks rallying on a social media hype rather than fundamentals, you got that, you guessed it.

43:31.197 --> 43:33.599 [SPEAKER_00]: meme craze at two point, oh, is here.

43:33.659 --> 43:41.363 [SPEAKER_00]: Retail traders are driving the action using Reddit and options to amplify these moves, just like what we saw with GameStop and AMC.

43:42.663 --> 43:45.085 [SPEAKER_00]: Short sellers are getting squeezed here.

43:46.488 --> 43:54.514 [SPEAKER_00]: Any time you have massive rallies and stocks, people that are short to stock, then have to cover because of the losses it drives the price ever higher.

43:55.014 --> 43:56.095 [SPEAKER_00]: And so what are these companies?

43:56.175 --> 43:57.516 [SPEAKER_00]: Chris, we pretty much already mentioned one of them.

43:57.676 --> 44:00.598 [SPEAKER_00]: Open door, rocket and coals are all struggling.

44:00.718 --> 44:02.800 [SPEAKER_00]: We have pretty questionable outlooks yet.

44:03.320 --> 44:05.262 [SPEAKER_00]: They are soaring on this speculation.

44:06.395 --> 44:10.358 [SPEAKER_00]: I'm not saying invest in these names, I think it is not a good idea to invest in names like this.

44:10.418 --> 44:15.122 [SPEAKER_00]: Tell anybody who's still holding the bag on GameStop, ask them what they think of the meme craze.

44:15.903 --> 44:21.027 [SPEAKER_00]: But anytime you're froth in the market like this, it is time to step back and take notice.

44:21.927 --> 44:27.532 [SPEAKER_00]: Understand that over-hype and over-speculation is typically when things start to turn.

44:29.578 --> 44:31.880 [SPEAKER_00]: I'm Lou Gregg, this completes another Invest Talk program.

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