[SPEAKER_01]: On radio, on YouTube, streaming live on investtalk.com, and for our podcast subscribers, this is Invest Talk.

[SPEAKER_01]: Independent Thinking, shared success.

[SPEAKER_01]: Invest Talk is made possible by KPP Financial, a registered investment advisor firm, serving clients throughout the United States.

[SPEAKER_01]: Here is KPP Financial Chief Executive Officer, Financial Advisor Justin Klein.

[SPEAKER_00]: Good afternoon fellow investors and welcome back to Invest Talk.

[SPEAKER_00]: This is our Tuesday, August, twenty-six, twenty-five edition and summer is Hurdling.

[SPEAKER_00]: to an end unfortunately uh... just a month left roughly and there's uh... this is a time where there's a lot of volatility market typically uh... right now it's a lot of headlines that's for sure uh... but not a lot of movement really one way or the other on uh... unequities over the past uh... called month or so uh... but

[SPEAKER_00]: That's not what this show is about.

[SPEAKER_00]: So it wasn't just about what's happening now.

[SPEAKER_00]: It's also answering your finance and investment question giving you perspective and doing deep dive and particular topics that are important.

[SPEAKER_00]: It's what we bring to you perspective and data and discussions around important data points.

[SPEAKER_00]: Important topics that will drive economic growth, sector growth or lack thereof.

[SPEAKER_00]: And all this is to help inform you on how to make better decisions with your money.

[SPEAKER_00]: You know, what asset classes do avoid, what to lean into, depending on the market environment, both in the short, medium and long term.

[SPEAKER_00]: So that's what this hour is dedicated to you to do is help you take your next step in your own version of financial freedom.

[SPEAKER_00]: So in just a bit, we'll talk about today's Mark performance and run down the show topics that we'll discuss throughout the hour, but as usual, we'll tackle this first call.

[SPEAKER_05]: I guess I was going to ask you about Campbell's CPB, about this position, a little while back, and I've lost about ten percent

[SPEAKER_05]: I just curious what's going on here if you think I should bail or if it's starting to look a little more affordable.

[SPEAKER_05]: Thanks.

[SPEAKER_00]: Alright, looking at Campbell's soup.

[SPEAKER_00]: I don't think I need to tell everybody what Campbell's does obviously make tons of canned soup beverages, meals, etc.

[SPEAKER_00]: But around for a long time, it's a name almost all Americans know.

[SPEAKER_00]: However, this is to me one of those perfect value traps.

[SPEAKER_00]: It has a name that looks stable.

[SPEAKER_00]: It has a dividend that looks attractive for point eight percent now.

[SPEAKER_00]: I'm sure when this color bought it, it was even a bit higher than that.

[SPEAKER_00]: Or a bit less, sorry, it was a bit lower than that, right?

[SPEAKER_00]: Because it's gone up, obviously since it's gone down.

[SPEAKER_00]: But earnings are heavy lower.

[SPEAKER_00]: And if you look at its payout ratio, it's paying out all of its earnings.

[SPEAKER_00]: Now, it's not being all of its cash flow, but it's paying out all of its earnings.

[SPEAKER_00]: In the dividend, which is certainly not sustainable.

[SPEAKER_00]: And earnings, guess what?

[SPEAKER_00]: Are set to decline.

[SPEAKER_00]: Five percent this year and eleven percent next year.

[SPEAKER_00]: There are a lot of these, I would say old brands, brands that have around decades.

[SPEAKER_00]: Brands that, in an I was a kid, I used.

[SPEAKER_00]: Think of Campbell's, think of Kellogg, think of a lot of packaged food names that are out there.

[SPEAKER_00]: Tastes are evolving.

[SPEAKER_00]: And frankly, the newer younger generations are more focused on health, and they want less packaged goods.

[SPEAKER_00]: And so this is from a secular perspective, simply not a great place to be.

[SPEAKER_00]: Then you add on top of that.

[SPEAKER_00]: That's competitive market.

[SPEAKER_00]: And Campbell's runs on not very high margins, they're a team percent operating margins.

[SPEAKER_00]: And that has continued to come down over the last couple decades.

[SPEAKER_00]: And so cash flows, there's still good, seven hundred, seven hundred, eleven million dollars, but they're on the decline from a peak over a billion dollars in twenty-twenty.

[SPEAKER_00]: And the issue is they have a lot of debt, about seven billion dollars in net debt in its balance sheet and then market up to nine point five billion.

[SPEAKER_00]: Not to say that it's not sustainable in the near term, but

[SPEAKER_00]: If earnings continue to decline, margins continue to go into pressure, well, you know, that's going to strain their balance sheet.

[SPEAKER_00]: And they're probably going to cut that dividend at some point.

[SPEAKER_00]: Now to be fair, I don't think it's risk being cut soon, but the chart is telling you that it's headed in that direction.

[SPEAKER_00]: So you're buying this for the stability of the brand and the dividend yields,

[SPEAKER_00]: Remember, you always have to look at the quality of the earnings, sustainability of the earnings, and the balance sheet when you're looking at dividend payers.

[SPEAKER_00]: And this just does not check the majority of the boxes you need.

[SPEAKER_00]: So I'm absolutely selling this name.

[SPEAKER_00]: I would move on.

[SPEAKER_00]: I just don't like names with this level of debt with declining earnings.

[SPEAKER_00]: Thanks for the call.

[SPEAKER_00]: It in ninety nine chart, it in ninety nine two four two sevenies.

[SPEAKER_00]: I could throw and ask your question on today's show.

[SPEAKER_00]: We have a lot of ground to cover over the next forty five minutes.

[SPEAKER_00]: And I mean, folks, point is about how Fed shared your own bowels worried about the job market, but here are three red flags for workers.

[SPEAKER_00]: And we'll dig into some data around the labor market that is kind of less discussed, okay?

[SPEAKER_00]: Kind of parse out where the weaknesses with issues are in today's labor market.

[SPEAKER_00]: In addition, we'll touch on kind of expansion of that, which is immigration, right?

[SPEAKER_00]: Fed share, or the labor market data that we'll discuss is more around demand for workers, but we also want to hit on the data around the supply of workers in that trajectory and what type of impact that we'll have on the broader economy.

[SPEAKER_00]: And we'll look at a recent meeting at the White House in regards to copper project.

[SPEAKER_00]: And we'll dig into why this is becoming such an important discussion

[SPEAKER_00]: for the nation, for AI build out, for modernizing the electric grid, infrastructure building, et cetera, a copper is a big part of this.

[SPEAKER_00]: And we'll dig into that story because I do think that is vitally important.

[SPEAKER_00]: What else do we have?

[SPEAKER_00]: We also have voice bank calls, earnings forecast is one call, and then Nike is another.

[SPEAKER_00]: And we have some questions that came in earlier from the Investock YouTube channel.

[SPEAKER_00]: Of course, I welcome your finance and investment questions right now.

[SPEAKER_00]: But we're going to head into a break.

[SPEAKER_00]: Please don't have you can call any time and leave your question on the Investock voice bank.

[SPEAKER_00]: And if you're listening via our live stream, or any M-T-O-T-W-E, in the Bay Area, you can call now at eight and eight ninety nine chart.

[SPEAKER_00]: And I'm next that will come on today's market activity.

[SPEAKER_02]: Serious investors are certain to have finance and investment questions.

[SPEAKER_02]: Wanted to get your take on WW Granger.

[SPEAKER_02]: And the best person to ask your question in the right way is you.

[SPEAKER_00]: I was wondering from your standpoint, they're at downside in buying fractional shares versus whole shares.

[SPEAKER_02]: And twenty four seven rain or shine, Justin Klein and Luke Guerrero stand ready to provide their unbiased answers.

[SPEAKER_00]: The issue, though, is really over the last decade or so.

[SPEAKER_00]: It's never maintained this level of profitability for a long period of time.

[SPEAKER_00]: The modities are incredibly volatile, so when the going is good, take some profit.

[SPEAKER_02]: Your participation makes an investor talk better.

[SPEAKER_02]: My name is Mike.

[SPEAKER_02]: I'm calling in from Orange County, California.

[SPEAKER_02]: This is Lewis calling from Bolivia.

[SPEAKER_02]: Let's go talk to Chris and me.

[SPEAKER_02]: So don't forget to call, investor talk.

[SPEAKER_02]: First off, great show.

[SPEAKER_02]: I went last week too.

[SPEAKER_02]: Eight, eight, eight, ninety nine chart.

[SPEAKER_02]: The calls are free, the unbiased answers are free.

[SPEAKER_02]: So what are you waiting for?

[SPEAKER_02]: Call in Vestock.

[SPEAKER_00]: Let's go take a look at the market today.

[SPEAKER_00]: It was a modest update.

[SPEAKER_00]: Nice little bounce back after yesterday's cell-off.

[SPEAKER_00]: We closed near the lows.

[SPEAKER_00]: And today you had the NAS that got about forty-four basis points, S&P-up, forty-one basis points, the dial up about third of one percent.

[SPEAKER_00]: And you mainly had strength out of things like you that lily, they had some good news around one of the weight loss drugs of a five point eight percent there.

[SPEAKER_00]: So the max seven names Microsoft Google and Oracle were all down.

[SPEAKER_00]: You had Apple and video broadcast up all about one percent there.

[SPEAKER_00]: A meta was about flat Amazon, about flat and Tesla that was up one point four percent.

[SPEAKER_00]: On the day, the strength is really around the financial sector.

[SPEAKER_00]: You had capital one up nearly two percent, JP Morgan about one and a quarter, make America one and a half, let's far go one and two thirds.

[SPEAKER_00]: So that's where you saw really the strength in the markets today.

[SPEAKER_00]: Outside of that, you kind of mix picture to be honest with you is some some good some bad, but really it's not a whole not a whole lot doing until tomorrow's earnings revenue video.

[SPEAKER_00]: It's after the close that is the largest waiting in the market now and clearly it has a lot of downstream modifications for the broader market.

[SPEAKER_00]: So we'll see what those earnings look like and what the what the

[SPEAKER_00]: Well, the reaction in markets will be, and then on Friday with the PCE number, and that will be a big factor, swing factor in what the Fed is likely to do going forward.

[SPEAKER_00]: But the big news in today's market was, bed governor Cook is, is trying to be fired by the president.

[SPEAKER_00]: Obviously, she is saying she wants to step down and she's challenging this.

[SPEAKER_00]: Odds are good.

[SPEAKER_00]: She will today.

[SPEAKER_00]: There's no prosecution around the allegations.

[SPEAKER_00]: So we'll see this obviously could, could go in many directions.

[SPEAKER_00]: I think that the market wasn't happy about it.

[SPEAKER_00]: Dollar down is, see how much was the dollar down.

[SPEAKER_00]: Down, about two point two percent.

[SPEAKER_00]: So not a huge move there, but gold didn't finish up about half percent.

[SPEAKER_00]: Bitcoin was up point three percent.

[SPEAKER_00]: Bitcoin still remains relatively weak, though.

[SPEAKER_00]: And I've been talking about this.

[SPEAKER_00]: This breaks the one-trial level.

[SPEAKER_00]: That's starting to turn the Bitcoin price chart from

[SPEAKER_00]: bullish to add best neutral, of call it neutral now.

[SPEAKER_00]: And right now we broke it down to one ten, now we're back to one twelve.

[SPEAKER_00]: So we'll see we're at that usually is a proxy for broader liquidity.

[SPEAKER_00]: So we'll see if that does really power to the downside or this is just kind of a head fake sell off.

[SPEAKER_00]: So we'll see on that.

[SPEAKER_00]: What else do we get?

[SPEAKER_00]: We had interest rates were down about five basis points on the short end.

[SPEAKER_00]: This is on the back of that attempted firing of the Fed governor or yeah, one of the Fed governors.

[SPEAKER_00]: And frankly, I think it's a little bit of a overraction.

[SPEAKER_00]: You did see the long end had higher though.

[SPEAKER_00]: Okay, and that obviously steep in the yields curve.

[SPEAKER_00]: There's worries about inflation.

[SPEAKER_00]: You also had the consumer confidence number that was a bit better than expected.

[SPEAKER_00]: The consensus was ninety seven.

[SPEAKER_00]: It came in at ninety seven point four.

[SPEAKER_00]: It's not a big beat, but certainly better there.

[SPEAKER_00]: But inflation expectations continue to, they ticked up for the first time in three months.

[SPEAKER_00]: Consumers are starting to see and feel inflation a bit more in building that into their future expectations.

[SPEAKER_00]: So that was really the big economic news as we wait for the Nvidia news tomorrow.

[SPEAKER_00]: That's where we're at.

[SPEAKER_00]: Now every day, we received questions from the comments section of the investment on YouTube channel.

[SPEAKER_00]: And here's one that came in earlier.

[SPEAKER_00]: Cookie production says, I was wondering if you could analyze Duo Lingo D U O L.

[SPEAKER_00]: Well, this is a relatively recent IPO.

[SPEAKER_00]: I guess, twenty twenty one is one of the IPO.

[SPEAKER_00]: It fell off from, let's see what I put around.

[SPEAKER_00]: One forty came down to a low around what is this?

[SPEAKER_00]: Sixty dollars and change.

[SPEAKER_00]: Now we're at three hundred and sixteen dollars per share because earnings were negative in the only twenty two made thirty five cents in twenty twenty three.

[SPEAKER_00]: This is my three dollars and twenty five cents this year and four seventy eight next year.

[SPEAKER_00]: Now here's my issue with this.

[SPEAKER_00]: First off, even if you go based on forward looking earnings, forward looking earnings, it is extremely rich, extremely rich.

[SPEAKER_00]: You're talking forward multiple of eighty in that range, very high.

[SPEAKER_00]: Then if you look at some of the other metrics, price sales is seventeen point four, very high.

[SPEAKER_00]: enterprise value even a hundred thirty eight.

[SPEAKER_00]: Extremely high.

[SPEAKER_00]: They have a good balance sheet net cash on the balance sheet.

[SPEAKER_00]: That's a good thing.

[SPEAKER_00]: But the multiple that's trading at is a greatest.

[SPEAKER_00]: I would short it and I would short it.

[SPEAKER_00]: For a second reason, not just the valuation.

[SPEAKER_00]: It's.

[SPEAKER_00]: Why pay for do a lingo.

[SPEAKER_00]: When you could literally ask.

[SPEAKER_00]: almost all the large language models to create a game, a quiz, do pretty much everything dual-lingo does for you.

[SPEAKER_00]: To help you learn a language, you can do that.

[SPEAKER_00]: So now, so a lot of people still use dual-lingo, I don't think it's going away, but

[SPEAKER_00]: that medium to long-term threat is now there, clearly.

[SPEAKER_00]: And so I see no reason to pay this much of a premium.

[SPEAKER_00]: And frankly, this is rolled over.

[SPEAKER_00]: The technicals are rolling over in a big way, in a massive way.

[SPEAKER_00]: You're talking about this peeking out where we, five, fifty.

[SPEAKER_00]: Now we're already a three, sixteen.

[SPEAKER_00]: He got a five, fifty back in April.

[SPEAKER_00]: So it's in a downtrend and I would short it much more than I would buy it.

[SPEAKER_00]: We're moving to a break still to cut my focus point and we're answers to your questions, but I encourage you to call right now.

[SPEAKER_00]: On a best stock at eight and a day, ninety nine chart.

[SPEAKER_02]: In today's market, more than ever, you need unbiased investing guidance, because it can help you achieve financial freedom.

[SPEAKER_02]: Well, you've come to the right place in Vestock, and Justin Klein is here now taking your calls live.

[SPEAKER_02]: So step up with your questions, eight, eight, nine, nine chart.

[SPEAKER_00]: Now my main focus point today is about how the Fed is worried about the jobs market and there are three major red flags that investors should be caring about.

[SPEAKER_00]: Number one is really around the hiring data that came out recently.

[SPEAKER_00]: There's a lot of headwinds we know that and on average of the past three months there's only been about net thirty five thousand jobs created.

[SPEAKER_00]: that compares to last year, a hundred and sixty-eight thousand jobs were created each month.

[SPEAKER_00]: So that's number one, that sharp slowdown.

[SPEAKER_00]: And number two is long-term unemployed is now up considerably.

[SPEAKER_00]: Long-term job seekers are those that are considered unemployed for twenty-seven weeks or longer.

[SPEAKER_00]: And July, that's about one point eight million Americans.

[SPEAKER_00]: They were unemployed for longer than twenty seven weeks.

[SPEAKER_00]: That was up sixty four percent from three years ago and twenty percent from one year ago.

[SPEAKER_00]: So it shows you hiring has low firings have not.

[SPEAKER_00]: Firings have not slowed dramatically, but hiring's have slowed considerably.

[SPEAKER_00]: Then you look at young workers.

[SPEAKER_00]: And this is probably the most troubling because it's so important for those that

[SPEAKER_00]: exit college, especially if you have a lot of debt.

[SPEAKER_00]: They get a job, and since our building real world experience.

[SPEAKER_00]: And unfortunately, that's not happening in a big way right now.

[SPEAKER_00]: If you look at younger workers as a percentage of the total unemployed, most of last year in twenty twenty three, it hung around between nine and ten percent of the unemployed population.

[SPEAKER_00]: Right now, it's about thirteen and a half percent.

[SPEAKER_00]: You know that.

[SPEAKER_00]: It was pretty stable for a couple of years.

[SPEAKER_00]: I said, eight, nine, ten percent.

[SPEAKER_00]: Been an uptrend since, twenty, twenty, two, but it was relatively stable.

[SPEAKER_00]: Like I said, up until June.

[SPEAKER_00]: And then it skyrocketed.

[SPEAKER_00]: So young workers are seeing limited, new entry position opportunities.

[SPEAKER_00]: And a lot of us do with AI replacing starter jobs.

[SPEAKER_00]: So I think this is the beginning of the bright broader worry over AI's impact on the labor market.

[SPEAKER_00]: But simply, white-color jobs, white-color companies can do more with less.

[SPEAKER_00]: And when companies can do that, they will.

[SPEAKER_00]: And they are in a big, big way.

[SPEAKER_00]: So I think that's the big takeaway here is one of the big reasons for the lack of hiring is AI.

[SPEAKER_00]: And others labor supply, which will get to a little bit later.

[SPEAKER_00]: But understand that this is a good example about not everything in the world is black and white.

[SPEAKER_00]: There are

[SPEAKER_00]: I would say everything in the world is not black and white, right?

[SPEAKER_00]: It has shades of gray, and there are multiple factors that go into it.

[SPEAKER_00]: And this is a good example of that.

[SPEAKER_00]: Where you can't just blame it on AI, you can't just blame it on lack of immigration.

[SPEAKER_00]: You can't just blame it on tariffs, even though that does bring a merceness to the picture.

[SPEAKER_00]: And a lot of companies are saying that.

[SPEAKER_00]: But economically, there's just too much uncertainty.

[SPEAKER_00]: And it's manifesting in why commit to a young inexperienced worker, and invested in that one I can spend twenty dollars for, Judge EBT, or herplexity, or Gemini, or Claude, whatever it is.

[SPEAKER_00]: And that's how this is manifesting in today's jobs market.

[SPEAKER_00]: And that's why the Fed chair is a little bit hesitant to cut, right?

[SPEAKER_00]: Because this isn't in situation where the labor market is deteriorating on both ends.

[SPEAKER_00]: Usually that's how it works.

[SPEAKER_00]: There is a lack of need for workers and you naturally stop hiring and you shed workers.

[SPEAKER_00]: That's not quite happening yet.

[SPEAKER_00]: So a pretty interesting dynamics.

[SPEAKER_00]: here on the demand side, and a bit later we'll talk about the supply side.

[SPEAKER_00]: Now we're going to head to a quick break.

[SPEAKER_00]: And whatever's on your mind, you don't hesitate to give us a call.

[SPEAKER_00]: As usual, our number, same is always twenty four seven, three sixty five, you can give it a call.

[SPEAKER_00]: It's eight and eight ninety nine chart.

[SPEAKER_02]: Every investor is working to build a secure financial future.

[SPEAKER_02]: The more you learn about how the market works, the better your chances for success.

[SPEAKER_02]: Invest talk, eight, eight, nine, chart.

[SPEAKER_00]: All right, let's start with the next investor talk.

[SPEAKER_00]: As we'll look into this question, are you missing the key steps to maximize your retirement next thirty years?

[SPEAKER_00]: If you've got thirty years to go before retirement, you have time to learn how strategic asset allocation, consistent contributions, and adjusting for risk and help build a solid foundation for financial independence.

[SPEAKER_00]: We'll dig in that story tomorrow above and now let's go to a fresh listener question from eight to eight ninety nine chart.

[SPEAKER_04]: Hi, Justin Luke.

[SPEAKER_04]: This is Andrew from Buffalo.

[SPEAKER_04]: I was talking about the ticker stock and I eat.

[SPEAKER_04]: It's obviously been a bit of a downturn, but it seems to have sounded space and it's working to weigh up.

[SPEAKER_04]: Let's see if that starts in a small position here and it was wondering what you thought.

[SPEAKER_04]: Thanks so good day.

[SPEAKER_00]: I took a look at Nike a name that's been kind of all over the board recently, but mainly in a downtrend.

[SPEAKER_00]: If you look at it, it peaked back in twenty twenty one when everyone was home getting their stimulus jack spying physical goods because they couldn't go out to

[SPEAKER_00]: restaurants and travel and things like that sale extra money they're pocketed where did they buy a lot of them bought the night keys in their business boomed but this peak that around a hundred seventy seven dollars per share at the end of twenty twenty one but the recent lows around fifty three dollars per share and now we're back up to seventy eight but still below the fifth the hundred week moving average and it's in a broader downtrend and the earnings continue to struggle earnings this year expected to be down twenty three percent to a dollar sixty six

[SPEAKER_00]: They are more than that during COVID, right?

[SPEAKER_00]: They're doing the twenty-twenty year when kind of everything was shut down, right?

[SPEAKER_00]: Twenty-twenty-twenty.

[SPEAKER_00]: It was really when it bounced back.

[SPEAKER_00]: That's what they made three dollars and fifty-six cents and three seventy-five and twenty-twenty-two, but that was the peak.

[SPEAKER_00]: And so they made a lot of missteps.

[SPEAKER_00]: They have a new CEO.

[SPEAKER_00]: And I think they can get their mojo back.

[SPEAKER_00]: I just think there's a lot of work to be done.

[SPEAKER_00]: And last quarter, revenue's down to twelve percent, earnings are down eighty-six percent.

[SPEAKER_00]: The earnings are supposed to bounce back next year to two dollars and forty three cents, but failed to seventy dollars stock.

[SPEAKER_00]: And to me, you have to show that consistency of growth.

[SPEAKER_00]: They grow, they've lost a lot of ground to hook up and on.

[SPEAKER_00]: And I just think they've lost their innovation mojo and they need something to shake their business up.

[SPEAKER_00]: Beyond just

[SPEAKER_00]: Retreading old sneakers, which they're great.

[SPEAKER_00]: I wear neckies and I'm a basketball.

[SPEAKER_00]: I wear neckies.

[SPEAKER_00]: I love neckie.

[SPEAKER_00]: I love the brand.

[SPEAKER_00]: But it's a brand that unfortunately was taken over and I see this all the time.

[SPEAKER_00]: But whenever I see a former CFO or somebody from the consulting company take over as CEO, especially for a consumer-facing brand, it's over for that brand.

[SPEAKER_00]: It's over, at least in the near-term until they put in somebody that can understand the aspects of brand building.

[SPEAKER_00]: What most CFOs or consultants do, they come in there and they get too cute and they look at the numbers and they dig in and they try to expand their margins and they do all these things to micro-manage how it's all working and they completely ignore the brand.

[SPEAKER_00]: And this is what happened with them.

[SPEAKER_00]: I think it was Donahue was the last CEO from a correctly.

[SPEAKER_00]: And, yeah, John Donahue.

[SPEAKER_00]: I remember correctly, I think he's a former Bane capital, or a chairman of his background, but I remember it was insulting.

[SPEAKER_00]: But it's just not that the person you wanted to see, oh, I'm not kidding.

[SPEAKER_00]: You were any consumer-facing brand.

[SPEAKER_00]: And he really did a really terrible job.

[SPEAKER_00]: And this new CEO,

[SPEAKER_00]: much better background.

[SPEAKER_00]: But it's gonna take a while.

[SPEAKER_00]: It's gonna take some years for them to do more cool stuff.

[SPEAKER_00]: You know, think of back in the day, the Jordan commercials, especially commercials.

[SPEAKER_00]: Just the coolness of the brand, I think is still there and still can be revived, but it's faded.

[SPEAKER_00]: And it needs a spark.

[SPEAKER_00]: And until they get that spark, I just don't feel confident in buying it.

[SPEAKER_00]: You better name it certainly stays in the watch list and

[SPEAKER_00]: can look attractive again in your future.

[SPEAKER_00]: Don't let's make it to in a row from eight a day and a short.

[SPEAKER_03]: Hey, Justin or Luke, this is Tyler from Kansas City.

[SPEAKER_03]: My question today is to do with earnings forecast.

[SPEAKER_03]: I have a list of maybe thirty to forty stocks that have alerts of prices I find them interesting at.

[SPEAKER_03]: When the alert goes off, I reconfirm that I'm still interested in these names and then sell puts or go ahead and buy into the names if I don't think they'll go in any lower.

[SPEAKER_03]: Over the years, I noticed that a decent percentage of these alerts happen when an earnings or revenue forecast gets a revision to the downside.

[SPEAKER_03]: All my information sources seem to be late by one to three days.

[SPEAKER_03]: This gets frustrating when I take a position just to realize that forecast have been lower to a point that I would have lowered my target buying price.

[SPEAKER_03]: Who have you found to be the best original sources that indicate these revisions?

[SPEAKER_03]: And do you register to anyone specific for these type of forecasted earnings and or revenue alerts?

[SPEAKER_03]: Thank you guys.

[SPEAKER_03]: I'll be listening on the podcast.

[SPEAKER_00]: This is a great question.

[SPEAKER_00]: And this is an area where it's difficult for the average investor to get good up-to-date data.

[SPEAKER_00]: We use FAXET.

[SPEAKER_00]: Now we have, we're in our air, we're a financial advisor.

[SPEAKER_00]: We can pay for the, it's tens of thousands of dollars a year.

[SPEAKER_00]: For this data and that they're doing is they're aggregating all of the earnings estimates for from the major banks.

[SPEAKER_00]: We can see it, we can go in, we can see every single one.

[SPEAKER_00]: What the trend is, is it rising?

[SPEAKER_00]: Is it falling?

[SPEAKER_00]: Is it saying flat?

[SPEAKER_00]: What does it look like for this year next year, even the year after?

[SPEAKER_00]: And

[SPEAKER_00]: We can see that pretty much real time.

[SPEAKER_00]: And so that's how we do it.

[SPEAKER_00]: Now there are other tools that access some effects that's data.

[SPEAKER_00]: But you're not going to get the granular details there.

[SPEAKER_00]: And I don't know how fast they get an update from fax it, right?

[SPEAKER_00]: They might be some delay there, I'm not sure.

[SPEAKER_00]: So that's kind of the difficult separation between it.

[SPEAKER_00]: You can

[SPEAKER_00]: There's maybe something where AI could help.

[SPEAKER_00]: It's creeping internet for the most up-to-date earnings data, but as we know AI, kind of, make sure you check where it's coming from.

[SPEAKER_00]: Check its sources.

[SPEAKER_00]: It should link its sources out.

[SPEAKER_00]: And then you can kind of dig into there.

[SPEAKER_00]: That's probably what I would do.

[SPEAKER_00]: If I didn't have something like that set, which I can go to at any time and just grab.

[SPEAKER_00]: So that's what we're at.

[SPEAKER_00]: Hopefully that helps.

[SPEAKER_00]: It's probably not a complete answer, but at least a direction you can go in.

[SPEAKER_00]: Thanks for the call.

[SPEAKER_00]: Let's talk about the labor market in regards to immigration, the supply side.

[SPEAKER_00]: And this is

[SPEAKER_00]: especially in today's world, this is not a political argument.

[SPEAKER_00]: It's simply an economic discussion.

[SPEAKER_00]: What are the impacts of the lack of immigration?

[SPEAKER_00]: And this is the, this is basically to from the biggest wave in immigration to none in a very short period of time.

[SPEAKER_00]: And this year, net immigration could be negative for the first time in decades.

[SPEAKER_00]: And this could have long-term economic growth impacts.

[SPEAKER_00]: get a great larger budget deficits and make it more difficult for us to substantial security, et cetera.

[SPEAKER_00]: Now from twenty ten to twenty nineteen pre-COVID.

[SPEAKER_00]: But nine or seventeen thousand people enter the country annually on average according to the congressional budget office.

[SPEAKER_00]: That went to three point three million in twenty twenty three and two point seven million in twenty twenty four.

[SPEAKER_00]: So it's slow but still very, very high.

[SPEAKER_00]: But estimates.

[SPEAKER_00]: are that we're going to go to maybe net zero.

[SPEAKER_00]: And some are saying we could drop as much as two hundred five thousand people this year.

[SPEAKER_00]: Now this is assuming that out migration is between six hundred seventy five thousand and a million.

[SPEAKER_00]: And due to increased deportations and voluntary departures.

[SPEAKER_00]: Now the last time net immigration was this low was the nineteen sixties.

[SPEAKER_00]: That's when boomers were entering the workforce.

[SPEAKER_00]: And there's plenty of excess supply of labor.

[SPEAKER_00]: So we didn't really need new workers.

[SPEAKER_00]: We had plenty.

[SPEAKER_00]: There wasn't that opportunity, and especially the ease of people getting to America.

[SPEAKER_00]: But now the opposite is happening.

[SPEAKER_00]: The boomers are retiring, leaving the labor force.

[SPEAKER_00]: And so the economy for economic growth is dependent on

[SPEAKER_00]: immigration in some way, shape or form.

[SPEAKER_00]: Obviously some industries more than others.

[SPEAKER_00]: Apollo estimates estimates that without immigration, we'd only produce about twenty-four thousand jobs a month.

[SPEAKER_00]: That compares to an average of one hundred fifty-five thousand jobs between twenty-fifteen and twenty-twenty-four.

[SPEAKER_00]: Now what this is going to look like exactly getting the right, the exact data, it's very difficult.

[SPEAKER_00]: It's hard to really find how you go through the leaving, how you go or coming in.

[SPEAKER_00]: But it's clear that this is part of the labor market dynamics that are happening right now.

[SPEAKER_00]: Now economists surveyed by the Wall Street Journal, last month they expect the immigration policies to subtract.

[SPEAKER_00]: Point two percent from growth next year and point three percent from growth the following year.

[SPEAKER_00]: So not a death meal to the economy, but certainly material.

[SPEAKER_00]: Some tech sectors obviously will be, in fact, more than others.

[SPEAKER_00]: In twenty twenty three, for example, non-citizens made up thirty three percent of maids and housekeepers.

[SPEAKER_00]: Thirty percent of construction workers were non-citizens and twenty four percent of landscape workers were non-citizens.

[SPEAKER_00]: And the agricultural department, this made that forty two, forty two percent of crop workers were immigrants without work authorization.

[SPEAKER_00]: So clearly, those sectors will be hurt the most, then you have to also think of the downstream effects of that.

[SPEAKER_00]: For example, construction will less homes be built because of it.

[SPEAKER_00]: For maids and housekeepers will hotels have trouble staying staffed and cleaning, having the capacity to clean that many rooms in that timeframe.

[SPEAKER_00]: And then you have to look at fertility rates, fertility rates,

[SPEAKER_00]: are expected to continue to drop.

[SPEAKER_00]: And the forecast is that deaths will outpace births in America by twenty thirty three.

[SPEAKER_00]: Just in seven years earlier than previously projected because the birth rate continues to decline.

[SPEAKER_00]: So without positive net immigration, you're going to see populations shrink.

[SPEAKER_00]: And like I said, the beginning, this is going to strain finances and sectors like housing.

[SPEAKER_00]: So you're just talking about a less dynamic economy and over the long run, less income per capital, capital.

[SPEAKER_00]: I remember whether you're legal or illegal, it's about income, income in the broader economy and they're spending now.

[SPEAKER_00]: Once again, not saying this is good or bad, it's up to you on your political and how you believe this will impact, should impact the country and what's right from a policy perspective, that's not what I'm arguing here.

[SPEAKER_00]: All I'm saying is, these are the facts.

[SPEAKER_00]: Maybe this is good, maybe we need a less population, maybe we need less dynamism, maybe we need an economy that shifts to the working class, for example, et cetera.

[SPEAKER_00]: There's arguments for that.

[SPEAKER_00]: I don't know how here to make this.

[SPEAKER_00]: I'm here to just tell you the economic impact.

[SPEAKER_00]: Let's go with the another YouTube comment question.

[SPEAKER_00]: Caleb Turner says, what are your thoughts on Robinhood markets?

[SPEAKER_00]: H-O-O-D is a symbol.

[SPEAKER_00]: I've been holding since April and bought it in around forty dollars per share.

[SPEAKER_00]: thing to look at Robin Hood, this is a name that EBS inflows with retailer, retail, investor activity.

[SPEAKER_00]: And right now, for the most part, the retail investor is still all in, especially on AI and crypto, et cetera.

[SPEAKER_00]: And this is the name that during, twenty-twenty-two in the market, sank, well, this sank too.

[SPEAKER_00]: From a high around,

[SPEAKER_00]: by eight dollars per share back in early twenty twenty one to a low around was this six dollars per share now ripped a hundred eight dollars per share earnings this year so to be a dollar sixty three dollar eighty six next year so quite the quite expensive now if I look at some of the other metrics dig in here you're looking at

[SPEAKER_00]: About ten billion dollars in net debt, not too bad on ninety six billion dollar mark cap, pre-casual iner seventy six million, that's good.

[SPEAKER_00]: But once again, about a one percent free cash flow yield and guess what?

[SPEAKER_00]: End of last year, free cash flows negative two fifty, fifty billion.

[SPEAKER_00]: So it's all over the place from that perspective.

[SPEAKER_00]: I just think this is way too expensive.

[SPEAKER_00]: Price sales twenty seven and a half.

[SPEAKER_00]: When liquidity adds an ultimately crypto and a lot of these meme stocks and AI stocks kind of top and this bubble burst, this will go down considerably similar to what you saw in twenty twenty two.

[SPEAKER_00]: So I just think this is a fairly good short now.

[SPEAKER_00]: I probably wouldn't short it right now because the tentacles are not terrible, but they're certainly deteriorating at these levels.

[SPEAKER_00]: It's momentum installed here since July, MACD is rolled over.

[SPEAKER_00]: It has a micro bearish pattern over the last week.

[SPEAKER_00]: The valuation and the chart, I'm starting to add this up to, this is kind of telling me a lot about, I think, the broader market and crypto.

[SPEAKER_00]: You see, like I said earlier, crypto has broken some major support and this is starting to look like a pretty good short.

[SPEAKER_00]: So interesting that both YouTube questions

[SPEAKER_00]: Line up to be pretty good shorts in my mind.

[SPEAKER_00]: That's the best stock.

[SPEAKER_00]: I'm Justin Klein.

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[SPEAKER_00]: metals, not precious metals, but more industrial metals, and probably the most important industrial metal, and that is copper.

[SPEAKER_00]: And recently, President Trump met with the CEOs of Rio Tinto, as well as BHP Group.

[SPEAKER_00]: He's the two of the largest mining companies in the world.

[SPEAKER_00]: And what they discussed was a copper project in

[SPEAKER_00]: Arizona that's been held up for decades.

[SPEAKER_00]: That is trying to get across the finish line to begin, begin, begin mining and get through the regulatory process.

[SPEAKER_00]: And they're making the present Trump and his administration are making metal production overall key priority and mainly copper, copper mainly because that's vital to the energy transition as well as conventional pipes.

[SPEAKER_00]: You find it home.

[SPEAKER_00]: So from building homes, to building AI data centers, to modernizing the electric grid, copper is needed in a big, big way.

[SPEAKER_00]: And unfortunately, there is not a lot of new developments for copper, new copper production or new copper mining, shall we say.

[SPEAKER_00]: In America, on average, it's twenty-nine years between discovery and commercial mine production.

[SPEAKER_00]: Think of that, twenty-nine years, three decades.

[SPEAKER_00]: That's the longest timeline of any country except Zambia.

[SPEAKER_00]: Now, other countries do it a lot faster, but it still takes a while.

[SPEAKER_00]: On average, it's close to a decade between once again.

[SPEAKER_00]: discovery and final production.

[SPEAKER_00]: Another issue with supply of copper is that most easy to reach deposits were depleted during the twentieth century, long time ago.

[SPEAKER_00]: Now miners must go deeper, so cost more.

[SPEAKER_00]: And you have to employ technology where

[SPEAKER_00]: to allow these humans to go deeper into the earth and survive.

[SPEAKER_00]: Something that, fifty hundred years ago, we shouldn't have a lot of this technology.

[SPEAKER_00]: Now, if this project goes forward, it would supply the US of twenty-five percent of its annual copper needs for as many as forty years.

[SPEAKER_00]: But it's been delayed for decades permitting environmental concerns and litigation.

[SPEAKER_00]: But final environmental approval was given in June, but opponents again appealed.

[SPEAKER_00]: And they wanted to let it keep from developing these deposits.

[SPEAKER_00]: And obviously, President Trump criticized this ruling.

[SPEAKER_00]: And so this is something that probably will eventually go through and is very interesting.

[SPEAKER_00]: But what's most interesting is the focus of this administration, which is really pushing on the industrial aspect and the ways that it can incentivize anchors, right?

[SPEAKER_00]: These picks and shot picks, carrots and sticks.

[SPEAKER_00]: There we go.

[SPEAKER_00]: The carrots and sticks that's part of their running philosophy is do give some incentives, but also demand a lot.

[SPEAKER_00]: if they're going to do business, for example, in the United States.

[SPEAKER_00]: And so, out of this was interesting, because it certainly will have a broader impact on the copper space if it does get passed.

[SPEAKER_00]: And I think it will get through in this administration.

[SPEAKER_00]: But so far this year, despite this, benchmark copper is up eleven percent on the year.

[SPEAKER_00]: So I don't think it's really changed the long-term supply demand dynamic.

[SPEAKER_00]: There's still not enough demand.

[SPEAKER_00]: And this mine will take a long time really up and running and it create production.

[SPEAKER_00]: Well, that doesn't appreciate you all tuning in for this hour.

[SPEAKER_00]: Hope you got a lot out of it.

[SPEAKER_00]: Don't hesitate to reach out.

[SPEAKER_00]: Give us a call anytime, eight, eight, nine, nine chart.

[SPEAKER_00]: Give any questions that are on your mind.

[SPEAKER_00]: I'm Justin Klein and if today's show, maybe think about your own personal financial picture in any way.

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