[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,

[SPEAKER_00]: Good afternoon fellow investors and welcome back to invest talk.

[SPEAKER_00]: This is our Friday, January 16th, 2025 edition of Invest Talk and was quite the day and markets a lot happened.

[SPEAKER_00]: There's a lot going on with the Fed, but a news around who the next Fed chair might be.

[SPEAKER_00]: that can be good or bad for markets.

[SPEAKER_00]: We'll look at that.

[SPEAKER_00]: We also have some economic news around industrial production and housing market index.

[SPEAKER_00]: So we'll discuss that a little bit as well, but most importantly, it'll be about you.

[SPEAKER_00]: What's on your mind?

[SPEAKER_00]: What do you think about the new Fed share?

[SPEAKER_00]: Do you think this is good for the markets or bad?

[SPEAKER_00]: We'd love to hear about that.

[SPEAKER_00]: Do we hear what you think about the economy?

[SPEAKER_00]: What sectors are you looking at?

[SPEAKER_00]: What questions do you have about them?

[SPEAKER_00]: We're here for all of it, and we're here to help you become a better investor, mainly by answering your finance and investment questions.

[SPEAKER_00]: So with that said, let's get to it.

[SPEAKER_00]: As usual, we'll tackle a first-color question now, right?

[SPEAKER_00]: And then after we will go over the Mark performance and run down the show topic.

[SPEAKER_00]: So let's tackle that color question.

[SPEAKER_05]: This is James from Georgia.

[SPEAKER_05]: I was talking about SkyWorks.

[SPEAKER_05]: That's ticker SWKS.

[SPEAKER_05]: It's been down, so I'm curious.

[SPEAKER_05]: Do I need to get out of this?

[SPEAKER_05]: Should I maybe buy some more obkures here analysis?

[SPEAKER_05]: It can be played as advice.

[SPEAKER_05]: I'll listen on the show.

[SPEAKER_05]: Thanks.

[SPEAKER_00]: are looking at skywork solutions, SWKS is the symbol about 5% dividend yield, a lot of people might get excited about that.

[SPEAKER_00]: However, as I always say, it's about the business trends, business prospects.

[SPEAKER_00]: And this is a name whose earnings have fallen pretty considerably.

[SPEAKER_00]: $11.24 in 2022.

[SPEAKER_00]: And this year, so certainly $4.40 sent down 26%

[SPEAKER_00]: So it's in a clear downtrend.

[SPEAKER_00]: It's an end that we used to own for clients, but we moved on a while ago.

[SPEAKER_00]: Part of it was business deteriorating, probably part of it was the price deteriorating.

[SPEAKER_00]: And since then, both have continued to do so.

[SPEAKER_00]: And so that's why you have to listen to the signals and not be stuck in names that are just languishing or in a downtrend.

[SPEAKER_00]: And this is exactly it.

[SPEAKER_00]: So I would just move on, frankly,

[SPEAKER_00]: They can turn it around but ultimately the profitability is meager cashflow has dropped considerably from a high of 1.6 billion to about a billion right now.

[SPEAKER_00]: Still pretty good for cashflow yield, but once again if earnings are expected dropped 26% what's going to happen to cashflow is probably going to do something very similar.

[SPEAKER_00]: So I would move on from Skyworks SWKS is the symbol.

[SPEAKER_00]: Now, we've lined the ground to cover over the next 45 minutes or so, and time permitting, we will get to all of it.

[SPEAKER_00]: And our main focus point is about the cyber, super cycle.

[SPEAKER_00]: It are cyber security stocks, the new utilities of the 21st century.

[SPEAKER_00]: geopolitical tensions are obviously rising.

[SPEAKER_00]: You have digital warfare.

[SPEAKER_00]: You, and we'll discuss why cybersecurity stocks are becoming utilities, like I said up to 2026, and beyond.

[SPEAKER_00]: Those are going to that topic.

[SPEAKER_00]: Also, a new warning from Pimpco about President Trump's unpredictable policies.

[SPEAKER_00]: and prompting bond giant PIMCO to diversify a way from U.S. assets is this going to be a trend as we move through 2026 so we'll take into that.

[SPEAKER_00]: Also tech giants are getting more hands on with energy and we'll talk about some of those new deals struck by companies like Alphabet.

[SPEAKER_00]: And then lastly, if we have time, Amazon is buying America's first new copper output.

[SPEAKER_00]: from Arizona.

[SPEAKER_00]: So we'll dig into that topic, pun intended, dig in, get it, get it.

[SPEAKER_00]: So that's what's on the top on the Docket for me today, but most importantly, it'll be you.

[SPEAKER_00]: Like I said, whatever is on your mind, give us a call, it could be a comment as well.

[SPEAKER_00]: Doesn't have to just be a question.

[SPEAKER_00]: So we have voice bank calls, one is on call option ETFs.

[SPEAKER_00]: I love this one because they're so popular.

[SPEAKER_00]: And then ATI incorporated symbol ATI.

[SPEAKER_00]: And of course, we have some questions that came in via the comment section over on the Vestock YouTube channel as well, and most importantly, we'll be your live call.

[SPEAKER_00]: So if you call, you will get put in front of a lot in front of the line.

[SPEAKER_00]: So don't hesitate to call with anything money related on your mind.

[SPEAKER_00]: We are here for it, but we're going to do a quick break.

[SPEAKER_00]: Please remember that you can call any time, leave your question on the Avastock Voice Bank.

[SPEAKER_00]: If you're listening via our live stream or our name's 1220 in the Bay Area, you can call right now at 888-99 chart.

[SPEAKER_00]: Hang on, cause I'll be talking about today's market activity in the next segment.

[SPEAKER_03]: It's a new year, and you may have decided that it's time to get serious with your investment portfolio.

[SPEAKER_03]: Justin Klein and Luke Guerrero of KPP Financial are ready to help.

[SPEAKER_03]: Have you heard about Parallel investing?

[SPEAKER_03]: That's where the firm's principles invest their own money in the exact same investment programs at the same price and percentages as their clients.

[SPEAKER_03]: parallel investing differentiates KPP financial because it aligns the interests of KPP principles with those of their clients as they each share the same risks and potential for success.

[SPEAKER_03]: Learn more anytime at investalk.com just click on portfolio review.

[SPEAKER_03]: The Invest Talk phone lines are open waiting for your financial investment

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

[SPEAKER_00]: Overall, it was a modest down day.

[SPEAKER_00]: Nasdaq down, six basis points, S&P, also down six basis points, dad down, 17 basis points.

[SPEAKER_00]: So very minor red day overall.

[SPEAKER_00]: And it was option X day.

[SPEAKER_00]: So a lot of,

[SPEAKER_00]: Just kind of jogging for position.

[SPEAKER_00]: I think you'll see a lot of more movement next week.

[SPEAKER_00]: And then after that, you get into the Fed meeting as well, the following week.

[SPEAKER_00]: So, and next week, earnings kick into high gear.

[SPEAKER_00]: So that will be top of mind, I think, for markets as a whole.

[SPEAKER_00]: But certainly, I mixed bag today.

[SPEAKER_00]: It names like Broadcom and Microsoft.

[SPEAKER_00]: Eaking out a bit of a game, names like Tesla, meta, and video were roughly flat, but you had some losses over in the healthcare space, so names like Mark were down nearly 2% you had Boston scientific down over 2% metronics, etc.

[SPEAKER_00]: You had some strength out of some of the smaller tech names, so Micron was at 7.7% on the day, but weakness in some other pounds here down 3.5%

[SPEAKER_00]: sales fourth down 2.75, apple love and down 6% on the day.

[SPEAKER_00]: So some of the riskier tech names certainly were struggling overall.

[SPEAKER_00]: UPS and some of the transportation stocks more cyclical stocks certainly were a bit weaker.

[SPEAKER_00]: And I think it's had to do with

[SPEAKER_00]: rates being higher and the real news they have at the top of the show was what looks to be a shift in betting odds around Fed governor Kevin Warsh is now the leader 58% chance on Kalshi of becoming the next Fed nominee.

[SPEAKER_00]: There's reports that President Trump does not want

[SPEAKER_00]: be any sea director, Kevin Hassett, to head to Fed, because he wants to stay in his cabinet.

[SPEAKER_00]: So it looks like Worsh is now ahead, and that would mean probably a bit more hawkish Fed.

[SPEAKER_00]: Somebody that maybe isn't quite as loyal to the president, that would kind of do his bidding, et cetera.

[SPEAKER_00]: But it would also be able to,

[SPEAKER_00]: potentially get him through confirmation easier as well.

[SPEAKER_00]: Overall, the dollar was a bit stronger, the two-year yield rose four basis points reflecting

[SPEAKER_00]: Hey, maybe the odds of a really dovish fed throughout the rest of the year are a bit lower.

[SPEAKER_00]: So you definitely saw bonds fall a little bit and rates rise.

[SPEAKER_00]: Dollar, sorry, the goal of the finish down point 6% silver ended off 4.1%.

[SPEAKER_00]: So it's a pretty big pullback in silver.

[SPEAKER_00]: Silver and gold have been pretty overbought.

[SPEAKER_00]: You've seen a lot of sentiment that,

[SPEAKER_00]: tells you these are a bit of cooling off I've seen by headlines around gold and silver and usually that signals at least a short term at least consolidation phase or pullback would not shock me at all especially if you are going to get a more hawkish fed based on economic data based on odds of a different fed chair.

[SPEAKER_00]: as we head into the spring.

[SPEAKER_00]: Bitcoin down 0.1% and WTI down 0.4%.

[SPEAKER_00]: So really not a whole lot of movement on the day kind of choppy but the real big news is around that odds of the Fed chair and a more hawkish Fed going forward.

[SPEAKER_00]: Now, let's briefly mention the news, KPPP room newsletter, which will be distributed tomorrow this week in the KPP Insights section.

[SPEAKER_00]: We discussed the commodity cycle very important in today's world, stock idea section.

[SPEAKER_00]: We mentioned international retail pawn shop and a communications service company.

[SPEAKER_00]: And the portfolio manager section.

[SPEAKER_00]: We touch on why we don't need to own everything that goes up.

[SPEAKER_00]: If you're interested in learning more, visit us at vestalk.com and subscribe.

[SPEAKER_00]: Newsletter will come to your inbox on Saturday mornings.

[SPEAKER_00]: Let's keep things moving and dip back into the best stock voice bank for question that came in earlier.

[SPEAKER_07]: I had a quick question for you.

[SPEAKER_07]: Call options.

[SPEAKER_07]: I was just wondering if you could kind of explain in several terms what call options are on the service I understand that they're by themselves.

[SPEAKER_07]: They're basically risky.

[SPEAKER_07]: I won't know what your thoughts are on the call options, ETFs, and obviously their income producing.

[SPEAKER_07]: Also, tax-wise, I also know if it's utilizing them or recommend options, ETFs, I'll look forward to hearing from you on the earlier days.

[SPEAKER_07]: Thanks.

[SPEAKER_00]: So I'll start with the last part and then I'll go to the first question.

[SPEAKER_00]: So simply put

[SPEAKER_00]: These covered call ETFs, which are rash of them, have been issued.

[SPEAKER_00]: And I think it's malpractice for the SEC to allow them to advertise huge yields, because the reality is not the case in any way, shape, reform.

[SPEAKER_00]: So, on all of these, you need to ignore completely ignore the quote unquote yield on it, because it's not really what it is.

[SPEAKER_00]: There's selling call options, it's a cover call strategy, which in and of itself, I don't mind, what I do mind is people advertising that there's this huge yield that comes out of them.

[SPEAKER_00]: That's not really the case here.

[SPEAKER_00]: Okay, so I don't recommend them for most people unless it really fits them and it's all about the underlying position that you're holding, okay, for the most part.

[SPEAKER_00]: So don't get duped by them.

[SPEAKER_00]: Look at total return.

[SPEAKER_00]: Don't look at yield.

[SPEAKER_00]: Number one.

[SPEAKER_00]: Now what is a call?

[SPEAKER_00]: What is a call option?

[SPEAKER_00]: It is a derivative, any by definition a derivative is anything whose price is derived from some other instrument.

[SPEAKER_00]: In this case, it's an underlying stock.

[SPEAKER_00]: And a call simply the options with a call option to buy that stock at a future date at a future strike.

[SPEAKER_00]: So when you're selling

[SPEAKER_00]: When you're doing a cover call, you're owning the underlying.

[SPEAKER_00]: And you're giving someone else the right to buy that from you at a future date.

[SPEAKER_00]: And that can mean a lot of things could be in the money.

[SPEAKER_00]: It could be at the money.

[SPEAKER_00]: It could be out of the money.

[SPEAKER_00]: And what that means is how close is it to current price?

[SPEAKER_00]: Okay.

[SPEAKER_00]: And at the money is right around current price.

[SPEAKER_00]: In the money is if it's a call option that's the strike license below the current price that's in the money.

[SPEAKER_00]: For a call option, it's out of the money means it's higher.

[SPEAKER_00]: The strike price is considerably higher than where it is today.

[SPEAKER_00]: So that's a quick primer on all of this and for the love of God, stop buying into the yield of these covered call ETFs.

[SPEAKER_00]: Understand what they are, it lowers the overall risk of investing in the underlying company.

[SPEAKER_00]: But it's not a yield.

[SPEAKER_00]: It's simply a strategy.

[SPEAKER_00]: Thanks for the call.

[SPEAKER_00]: The old dancer, a YouTube comment question.

[SPEAKER_00]: Rowdy 1335678 says, I'm one of the lucky few have been buying physical silver for over a decade, but that's being up so much in a short time period.

[SPEAKER_00]: I'm worried about significant pullback with mental resistance at 100 from retail.

[SPEAKER_00]: This is just my theory, but do you think I sell a decent amount when I get close to 100 or see it break through and continue to hold?

[SPEAKER_00]: I'm bullish long term, but just to wonder if I'm overthinking it and the tax bill this causes would be worse than the pullback.

[SPEAKER_00]: This position has grown to about 12 and a half to 13% of my overall net worth.

[SPEAKER_00]: So first off, I don't think that's an extreme amount now.

[SPEAKER_00]: How much gold do you have as well?

[SPEAKER_00]: I would look at total precious metal exposure.

[SPEAKER_00]: Yeah, that's also 12 to 15%.

[SPEAKER_00]: You know, that starts the in total get a little large.

[SPEAKER_00]: But around 20% in precious metals, if total net worth, I don't see problem with that in this environment, frankly.

[SPEAKER_00]: So from that perspective, on its face is fine.

[SPEAKER_00]: Is there probably going to be a pullback at some point?

[SPEAKER_00]: Yes, you have to be comfortable with that.

[SPEAKER_00]: You also have to figure out your tax bill.

[SPEAKER_00]: But crudally trimming over time is not a bad idea.

[SPEAKER_00]: And 100 is usually a psychological number we do get a pullback.

[SPEAKER_00]: So,

[SPEAKER_00]: Yeah, trimming a little bit, not a bad idea, but I wouldn't be going clockwise with it.

[SPEAKER_00]: Then we're going to a break, right if you're a call's now at 8-899 chart.

[SPEAKER_03]: The weekend is here or almost here, but you've got finance and investment questions, so step up and call in, in Vestalk, 888 99 chart.

[SPEAKER_08]: Hi, Justin, we're the thing you guys for everything that you do, and I'm calling today about ticker A, C, I, it's kind of a pistachio was played on the aerospace and defense.

[SPEAKER_08]: I'm sure it's if you think the valuation is okay.

[SPEAKER_08]: I know it's gone up a lot recently, but do you think it still has room to grow?

[SPEAKER_08]: And do you have an entry point if you think up all back is needed before I would get in?

[SPEAKER_08]: Thank you very much for your time.

[SPEAKER_00]: We're looking at ATI.

[SPEAKER_00]: And this is a manufacturer's specialty materials and components for the aerospace and defense, medical and energy markets,

[SPEAKER_00]: So, it's a business that is booming earnings or expected to hit $3.86 this year.

[SPEAKER_00]: From all the way back in 2020, they'd lost money.

[SPEAKER_00]: Lost 52 cents.

[SPEAKER_00]: And in 2022, they only made $2.41.

[SPEAKER_00]: The newly doubled earnings since 2022, and that's why the stock continues to boom.

[SPEAKER_00]: Now, it is trading on a pretty high multiple based on forward looking earnings.

[SPEAKER_00]: Ford enterprise value is right around 19 times.

[SPEAKER_00]: So that's near most expensive.

[SPEAKER_00]: It's ever been.

[SPEAKER_00]: So it is pretty pretty pricey here, which elevates the risk.

[SPEAKER_00]: But the momentum is very strong.

[SPEAKER_00]: You can't be mad about that momentum, but you can be, say, mad, but you can be worried about the risk of the valuation here.

[SPEAKER_00]: So it's certainly a name that I would have in my watch list.

[SPEAKER_00]: I like the business overall, I think, harder.

[SPEAKER_00]: There's been an under-investment in,

[SPEAKER_00]: The harder science, especially ally, allies, for example, and this is right in the heart of that.

[SPEAKER_00]: So, I would be patient.

[SPEAKER_00]: I'd probably want to see this back in the below $100 per share, right now, that's at 124.

[SPEAKER_00]: I think it's below 100.

[SPEAKER_00]: I'd certainly pick up shares of A, T, I.

[SPEAKER_00]: Thank you for the call.

[SPEAKER_00]: Now in Fridays we generally make times for a quick rundown of some key benchmark numbers.

[SPEAKER_00]: So let's hit that list for you now, the two-year treasury yield, 3.597, called 3.6% last week, it was 3.54% so it didn't seem like a lot, but when it comes to the treasury market, that's a pretty decent move overall.

[SPEAKER_00]: The 10-year also moved up pretty considerably as well, actually not quite as much one from 4.17 and about 14.22.

[SPEAKER_00]: So about five and a half basis point.

[SPEAKER_00]: So the yield curve did flatten slightly.

[SPEAKER_00]: but nothing dramatic.

[SPEAKER_00]: Gold was at $48, $45, $88 an ounce, an $81 increase over last week's precious metals continued to power higher despite a modest pullback today.

[SPEAKER_00]: Silver, $89, $18 announced up $9 and $28 in one week.

[SPEAKER_00]: So despite the 4% pullback today, still up,

[SPEAKER_00]: over 10% on the week.

[SPEAKER_00]: If you look back, 195 weeks ago, just the few years ago, there was at $23 and 94 cents.

[SPEAKER_00]: Now we're at 80, 90, 18.

[SPEAKER_00]: So gold silver just in a secular bull market.

[SPEAKER_00]: That's only way you can really describe it.

[SPEAKER_00]: oil, 59, 39, an ounce, an ounce, a barrel up 43 cents compared to last week.

[SPEAKER_00]: We still have a main in kind of a choppy range right around this $50, $60 range, excuse me.

[SPEAKER_00]: And I think there's risk to both sides, especially if we go into Iran, what happens with

[SPEAKER_00]: Middle East oil supply, I think there's some short-term upside for oil.

[SPEAKER_00]: Longer term, I still don't love this as a growth play.

[SPEAKER_00]: Joey say it's more of a coupon clipping, because I think there's a floor around $40 probably for oil, but also probably an upside of $80.90 dollars.

[SPEAKER_00]: And if you get above that, it probably doesn't stay in that for very long.

[SPEAKER_00]: So don't expect the oil to break out anytime soon.

[SPEAKER_00]: A national average for gasoline $2.83, a three-cent increase compared to last week.

[SPEAKER_00]: Here in California, $4.20, a two-cent decrease from the previous week.

[SPEAKER_00]: And over in Ohio, the gas is averaging, sorry, not Ohio.

[SPEAKER_00]: Iowa, the gas is averaging $2.50 a gallon, one of the lowest in the country.

[SPEAKER_00]: Ready to break, and after, the break we will touch on cyber security stocks, but most importantly it will be your call.

[SPEAKER_00]: Whatever is on your mind, give me a call now at 8-8-89 chart.

[SPEAKER_01]: Got a question for Justin or Luke, you're the best person to ask it.

[SPEAKER_10]: Quick question, what are some signs of a that a recession is coming?

[SPEAKER_06]: It's only lesson for people who own stocks, even if they don't short a stock that the stock they own, they should know whether it's an heavily shorted.

[SPEAKER_00]: Invest talk is ready 24.7.

[SPEAKER_00]: If it gets to 170 to 175 in that range, that's where I pick it up.

[SPEAKER_00]: Awesome, thank you, Justin, appreciate it.

[SPEAKER_02]: I'm hoping you'll give me your cake on Oremat Technologies ORA.

[SPEAKER_02]: Curious if you think it'd be better for me to let it go and spend money elsewhere.

[SPEAKER_10]: I'm a new investor in your broadcast to help me out a lot.

[SPEAKER_01]: Call in Vestock, 888-99 chart, or post your questions on the Invest Talk YouTube channel.

[SPEAKER_03]: Have you heard about Parallel Investing?

[SPEAKER_03]: Parallel Investing differentiates KPP Financial because it aligns the interests of KPP principles with those of their clients as they each share the same risks and potential for success.

[SPEAKER_03]: Learn more anytime at InvestTalk.com just click on portfolio review.

[SPEAKER_00]: They have high modes and recurring revenue.

[SPEAKER_00]: Those analyzed why cybersecurity companies are the utilities of the 21st century.

[SPEAKER_00]: And these are names that are synonymous with, typically growth investing.

[SPEAKER_00]: And that's because we're in a world now where the most sensitive information is constantly at risk of being stolen.

[SPEAKER_00]: And there's cybersecurity, cybercriminals everywhere.

[SPEAKER_00]: And businesses, most importantly,

[SPEAKER_00]: And ours included, right?

[SPEAKER_00]: We always look at, we have a cybersecurity policy, where we're always trying to figure out how we can make sure our data is secure.

[SPEAKER_00]: And this is every company.

[SPEAKER_00]: We want to prevent data breaches, likely we'd never had one, but you always have to be visually.

[SPEAKER_00]: Governments as well.

[SPEAKER_00]: struggle to protect critical infrastructure, for example.

[SPEAKER_00]: So this is the ever present reality of today.

[SPEAKER_00]: So what does that mean for cyber security, cyber security industry and the companies that you can invest in?

[SPEAKER_00]: There's a lot of components to cyber security.

[SPEAKER_00]: It's not just one thing.

[SPEAKER_00]: You're talking about network security, cloud security, endpoint security, mobile security, application security, identity and access management.

[SPEAKER_00]: All of this is about protecting data.

[SPEAKER_00]: So companies do this by putting up firewalls, intrusion detection systems, securing wireless access points, et cetera.

[SPEAKER_00]: And now with so many people moving to mobile and doing a lot of their computing on mobile devices, mobile securities even more important as well.

[SPEAKER_00]: So you're talking smart phones, tablets, and other internet connected, even laptops, other types of devices.

[SPEAKER_00]: And it's all secured using encryption and a virus software as well as secure app development.

[SPEAKER_00]: So all of this is what goes into the idea of cyber security.

[SPEAKER_00]: It's not one thing.

[SPEAKER_00]: It's a myriad of things.

[SPEAKER_00]: And it's expected that cyber security, the cybersecurity industry will grow from $100 billion in 2023 by 231 to 412 billion.

[SPEAKER_00]: And you have entities like financial regulators, investment banks, commercial banks as well as health insurance companies, finance investment companies, all of this trying to secure data in some way shape reform.

[SPEAKER_00]: Now the threats are malware.

[SPEAKER_00]: We all know about that fishing attacks.

[SPEAKER_00]: Hopefully nobody's fallen prey to that.

[SPEAKER_00]: middle-man attacks where it looks like somebody else's that you trust is in the middle, but it's actually not that entity.

[SPEAKER_00]: And then there's denial, service attack, so rendering certain applications, useless, etc.

[SPEAKER_00]: So one of the drivers of one of the risks here.

[SPEAKER_00]: So obviously, as I said, a lot of growth.

[SPEAKER_00]: Millions of new devices are added every single year and for the most part, most of those need their own cybersecurity.

[SPEAKER_00]: Software.

[SPEAKER_00]: Right, for us internally at KP, we have cybersecurity at every single computer.

[SPEAKER_00]: But it's updated, constantly monitored, et cetera.

[SPEAKER_00]: So that's where the growth comes from.

[SPEAKER_00]: But that doesn't mean you just buy anything and you're gonna do well because they're risk.

[SPEAKER_00]: with more and more devices hitting the internet, it means that there's more uncertainty.

[SPEAKER_00]: There's more potential attackers.

[SPEAKER_00]: There's more potential thieves that are trying to break in, steal data, steal money, et cetera.

[SPEAKER_00]: And then when you're looking at companies that are out there, there's a lot of market share, and there's a lot of leaders with them, particular sub-segment of cybersecurity.

[SPEAKER_00]: And it is regulatory and cyber risk.

[SPEAKER_00]: So there's always the risk that leaders fall behind the times, they don't update, they get breached, they aren't vigilant, and someone else comes in with a better technology that makes systems more secure, at a better price, et cetera.

[SPEAKER_00]: Regulators could change their rules.

[SPEAKER_00]: And suddenly, the leg up that one company had, may not have that again.

[SPEAKER_00]: So he's at the beyond the look out for that.

[SPEAKER_00]: I like companies within this space that are very strong in one particular niche.

[SPEAKER_00]: That's case in most sectors, but for this day, niches make riches.

[SPEAKER_00]: I love that.

[SPEAKER_00]: Now the good news is they have market share,

[SPEAKER_00]: Strong IP around a particular area of cybersecurity, it creates a lot of long terms in terms of the ability for the most part.

[SPEAKER_00]: You have a locked in user base.

[SPEAKER_00]: However, as I said, technology can change, and so even if there's growth in the shares of the whole, they may fall behind.

[SPEAKER_00]: And so what might look very secure can change overnight.

[SPEAKER_00]: And then with AI is another curveball here.

[SPEAKER_00]: Not only increases the vulnerability of these systems, where a thief could train AI to breach, you know, try to breach particular systems.

[SPEAKER_00]: But also, when it comes to competitors coming in and building applications that are smarter, that are able to train AI to build their own AI, that will be better than the current systems.

[SPEAKER_00]: So it's certainly a moving target here.

[SPEAKER_00]: And then the last piece is really investor confidence.

[SPEAKER_00]: There's narrative shifts, number one.

[SPEAKER_00]: So there's one part of cybersecurity become more exciting than in the other.

[SPEAKER_00]: based on some narrative that can always happen.

[SPEAKER_00]: Then there's growth.

[SPEAKER_00]: While growth is good, and there is certainly growth built into this industry, it could be priced in.

[SPEAKER_00]: And so growth may just disappoint a little bit and you could see multiples come down considerably.

[SPEAKER_00]: And so a lot of the question people have is, is this worth the worth to pay the multiples for these type of names?

[SPEAKER_00]: And I would say for the most part, no, especially because of that ever-present risk, I'm being able to build a competitor at scale with a lot less people.

[SPEAKER_00]: So that can be good for app development.

[SPEAKER_00]: It also is good for competitors trying to steal the shine of the big guys.

[SPEAKER_00]: So while it's great,

[SPEAKER_00]: You don't just invest in the ones that are going up, or the ones that have the best reputation right now.

[SPEAKER_00]: Ideally, you wanna invest in up and commerce, or quite as expensive that are stealing market share, but maybe they're not the largest.

[SPEAKER_00]: The math approach we take within these cybersecurity space.

[SPEAKER_00]: That was the best stock.

[SPEAKER_00]: Now it's more than 62 million downloads.

[SPEAKER_00]: Thanks to you.

[SPEAKER_00]: Let's put it back to the best stock of boy's bank for a question that came in earlier on 8.899 chart.

[SPEAKER_09]: Hello, gentleman.

[SPEAKER_09]: This is Brett from California, close to Newport Beach.

[SPEAKER_09]: My colleague and I he's a first time investor as he's hooked on your guys' show.

[SPEAKER_09]: And we were discussing metals.

[SPEAKER_09]: He believes silver and aluminum is the future, but I really feel coppers more of the future.

[SPEAKER_09]: I feel like it's more of a need for what the world needs.

[SPEAKER_09]: It's a building, EVs, data centers, and so forth.

[SPEAKER_09]: I started a small position a couple months ago in Southern Copper.

[SPEAKER_09]: It's kind of run up a little bit, but I was wondering if I wanted to keep hanging on to this one.

[SPEAKER_09]: I just want to obviously see what's giving me your insight on what you feel, how the metals are, which ones are more important.

[SPEAKER_09]: And what do you think about Southern Copper?

[SPEAKER_00]: Thank you very much.

[SPEAKER_00]: Well, we certainly agree with you when it comes to industrial metals.

[SPEAKER_00]: Copper is the top of our list.

[SPEAKER_00]: Not only is the demand side, and that's something if you want to talk to your friend about is not just the demand.

[SPEAKER_00]: It's the supply and that is one of the biggest issues with copper is that there's not a lot of new supply.

[SPEAKER_00]: Even the supply and Arizona, which we'll talk about a little later that recently came on, it's kind of low grade copper.

[SPEAKER_00]: It's hard to get out of the ground and there's not a lot of new minds that are set to hit market.

[SPEAKER_00]: in the next five, 10 years, and it takes five, 10 years to get these things moving, so even if they started the project now, it wouldn't hit the market for a number of years into the future.

[SPEAKER_00]: So, copper, as you said, is so vital to, not just AI data infrastructure, but clean energy and electric grids and building, you know, traditional buildings, et cetera.

[SPEAKER_00]: So,

[SPEAKER_00]: We own something copper at CCo.

[SPEAKER_00]: We've owned it for a long time.

[SPEAKER_00]: I mean, it's been one of our best gain.

[SPEAKER_00]: If you bought it, probably $40 and $50 per share now it's at 180.

[SPEAKER_00]: So doing very, very well, we're still holding it, you know, you trim here at the margins when we get sober bought, but overall, you know, we're holding our large position in it.

[SPEAKER_00]: And so, we would continue to buy it on pullbacks, and because it's to us the best run and copper producer in the world.

[SPEAKER_00]: Now, silver and aluminum have their own merits.

[SPEAKER_00]: Not to say they're bad to invest in.

[SPEAKER_00]: I think those are great.

[SPEAKER_00]: Silver is more of a precious metal, even though it does have industrial applications.

[SPEAKER_00]: So, I think having silver exposure is good, but think of it more as a precious metal than an industrial metal, because copper is more often used as an industrial metal, and silver.

[SPEAKER_00]: And then aluminum, that's another, there's a lot of applications for electric grid, for AI infrastructure, for aluminum, and there's not as much supply, now it's not as,

[SPEAKER_00]: Tight as, as copper is likely to be over the next five to ten years when it's from a supply perspective, but certainly the demand is there.

[SPEAKER_00]: So if I'm going to rank those, I would probably put copper number one, silver number two, and aluminum number three, but I have no issue with holding all three in a portfolio.

[SPEAKER_00]: an email.

[SPEAKER_00]: Tyson said, hey Justin Aleuk, Tyson here from British Columbia, Canada.

[SPEAKER_00]: Love and appreciate the podcast.

[SPEAKER_00]: What are your thoughts on PNG Kraken Robotics, this is a small company, like the space, especially with Canada increasing its budget for national defense spending.

[SPEAKER_00]: Isn't quite a run lately.

[SPEAKER_00]: I'm just wondering what your thoughts on the company along with starting a position at these price levels.

[SPEAKER_00]: Let's take a look at p and g. This is probably p and g dot co.

[SPEAKER_00]: So for my Canadian brethren out there.

[SPEAKER_00]: Yeah, it is on quite the run now, 2.5 billion dollar market cap and it is profitable about 12 and a half percent return in equity, it has negative free cash flow, however.

[SPEAKER_00]: But in the aerospace and defense area,

[SPEAKER_00]: which this looks like that is in underwater robotic systems, subsea batteries, et cetera.

[SPEAKER_00]: I generally like the space, I would agree with you.

[SPEAKER_00]: Problem is, is that is extremely expensive, extremely expensive.

[SPEAKER_00]: Talking to price to sales around 22, and in a price value to EBITDA around 52, even if you look based on forward-looking earnings, which is expensive, and that's what worries me.

[SPEAKER_00]: and the free cash flow is negative and getting more negative.

[SPEAKER_00]: So to me, this feels more like a narrative play and something to watch for a considerable pullback.

[SPEAKER_00]: You know, and it's already kind of started.

[SPEAKER_00]: It looks like peak the few days ago and started to head down.

[SPEAKER_00]: And so if this can get back, you know, sub $5, you know, I think it's worth maybe taking a fly around, back around the 200 day moving averages that about four and a quarter.

[SPEAKER_00]: If you get back to that level, I might take a fly around it more for the geopolitical.

[SPEAKER_00]: risk that certainly is there with many defense names, robotics is certainly a secular trend, which I like, but understand the risks with this level of evaluation.

[SPEAKER_00]: I would certainly keep on the watch, so I would not buy it here.

[SPEAKER_00]: I think you missed it for now.

[SPEAKER_06]: Let's go easy on one more

[SPEAKER_06]: should I be looking for an exit?

[SPEAKER_06]: Should I be holding here?

[SPEAKER_06]: Just tell me what you think.

[SPEAKER_06]: Thank you.

[SPEAKER_00]: All right.

[SPEAKER_00]: Broadcom, AVGO is the symbol.

[SPEAKER_00]: And this was one of those AI darlings for a little while in earnings.

[SPEAKER_00]: Expectations continue to go earnings for this year, expected to be $10.21.

[SPEAKER_00]: It's up from $6.82 since last year, so up 50%.

[SPEAKER_00]: And then $14.24.

[SPEAKER_00]: So Anil's expectation is, can you do go up?

[SPEAKER_00]: However, this is one of those names where the, and this is the broad AS stocks from NVIDIA to Broadcom.

[SPEAKER_00]: What you're seeing is the momentum is slow, considerably.

[SPEAKER_00]: Broadcom has gone nowhere.

[SPEAKER_00]: Since September, when I had the spike, if I got the news, I think it was an earnings spike when it peaked out, right around 355, the chop sideways, one is high recently as four or 15 or so, pulled back and has just been chopping sideways in a bearish manner.

[SPEAKER_00]: So I think there's a lot of,

[SPEAKER_00]: valuation excess in these names.

[SPEAKER_00]: As I've said before, the amount of cat that's spending that's happening right now is just simply unsustainable based on the requisite revenue that's coming in from.

[SPEAKER_00]: AI applications, and so I expect growth across this space to slow considerably, especially in the chipside, and so I would be trimming at the very least a Broadcom right now.

[SPEAKER_00]: Now we're adding into our final break, so give me questions, we're going to get your question then right now, at 8.99 chart.

[SPEAKER_03]: Every investor is working to build a secure financial future.

[SPEAKER_03]: How they get there and when they get there, that depends on many variables.

[SPEAKER_03]: The more you learn about how the market works, the better your chances.

[SPEAKER_03]: So don't forget to call in Vestock.

[SPEAKER_03]: 888-99, chart.

[SPEAKER_04]: Hi, good day there, Justin and Luke.

[SPEAKER_04]: I have a question on a stock that I've been following here for a little while now, but it's had significant returns and I'm very much so considering getting involved in it with maybe 3% to start with and definitely increasing as it's going up rapidly.

[SPEAKER_04]: And with all the chaos going on in the world, I'm curious to think of what do you feel about ticker symbol KTOS?

[SPEAKER_04]: It might be a newer item, but it is significantly going up, and I believe it has some earnings per share coming in on it.

[SPEAKER_04]: Please look at it, and I'm very curious and anxious to hear what you think about it.

[SPEAKER_04]: Thank you for your feedback, look forward to hearing it on the show.

[SPEAKER_04]: Have a great day.

[SPEAKER_00]: Okay, Caratos Defense and Security Solutions, KTOS is the symbol and think of drones.

[SPEAKER_00]: military drone company and it's stock is booming.

[SPEAKER_00]: He's no way, no other way to describe it really as beginning the last year.

[SPEAKER_00]: It was trading around $20 per share now.

[SPEAKER_00]: It's at $130.

[SPEAKER_00]: Now from evaluation standpoint,

[SPEAKER_00]: There's this is extremely over values.

[SPEAKER_00]: This isn't a value play in any way, shape or form.

[SPEAKER_00]: This is a momentum play.

[SPEAKER_00]: This is a play on increasing the fence spending over time, increasing geopolitical uncertainty.

[SPEAKER_00]: And that's what you are playing here.

[SPEAKER_00]: And you can't argue with that.

[SPEAKER_00]: The trend is your friend, whether that's on the chart or just how the world is unfolding,

[SPEAKER_00]: So that's the play.

[SPEAKER_00]: Understand, though, that just as bad things can happen in geopolitics, so it can good.

[SPEAKER_00]: If tensions kind of ramp down in the Middle East and in Venezuela and Trump refocus on the economy or something and less on adventures around the world, well, then,

[SPEAKER_00]: this could easily reverse.

[SPEAKER_00]: If Congress says, I don't want to spend $1.5 trillion next year on defense, we're going to keep it around the current $1 trillion.

[SPEAKER_00]: Well, that could also hurt this name as well.

[SPEAKER_00]: So you're going to a lot of headline risk here, and you have to be very comfortable with that.

[SPEAKER_00]: So at 130 right now it's over bought, you know, if you get a bad headline, this crazy drop well below $100 per share in a very short order.

[SPEAKER_00]: Then you have to decide, what is the broader trend?

[SPEAKER_00]: Now, I believe we're in the foreturning.

[SPEAKER_00]: Major things are happening domestically and abroad.

[SPEAKER_00]: And it's all not going to turn out very well.

[SPEAKER_00]: That's the foreturning, right?

[SPEAKER_00]: It's usually very bad things come about.

[SPEAKER_00]: And then you get some sort of leader to refresh things and bring about what in the cycle terms, who call the spring.

[SPEAKER_00]: that stuff is after winter.

[SPEAKER_00]: We're in winter.

[SPEAKER_00]: We're in the dark times.

[SPEAKER_00]: We're in the challenging times domestically and through the world.

[SPEAKER_00]: And so that is this play and it's a good encapsulation of that.

[SPEAKER_00]: So I understand what you're buying.

[SPEAKER_00]: Now that said, for we end, I want to talk about in conjunction a report from the Chief Investment Officer at PIMCO, the largest bond investment company in the world, and they're saying they're diversifying out of U.S. assets mainly because of the U.S. presence rapidly changing policies.

[SPEAKER_00]: Dan Ivison, Ivison.

[SPEAKER_00]: Dan Ivison, he is, once again, the CIO.

[SPEAKER_00]: He says, we're diversifying, and we do think we are in a multi-year period of some diversification away from US assets.

[SPEAKER_00]: So this kind of hits on what I'm saying of last year, Foreign Stocks.com performed.

[SPEAKER_00]: They're outperforming already this year.

[SPEAKER_00]: They're likely to continue to perform as more and more investors.

[SPEAKER_00]: Don't see the United States as a safe, the safest place in the world anymore.

[SPEAKER_00]: You know, it becomes a riskier place to hold their assets.

[SPEAKER_00]: It's bottom line.

[SPEAKER_00]: You go from very, very safe to still pretty safe.

[SPEAKER_00]: But, you know, not as clear cut as it was before.

[SPEAKER_00]: And so that's why both domestic investment companies and foreign investors are diversifying as well.

[SPEAKER_00]: I also talked about Fedton independence, which Jamie Diamond also talked about recently, but he said that Fedton independence on setting monetary policy remains critically important to market.

[SPEAKER_00]: He worries that aggressive fed cutting in the face of strong growth and elevated inflation will likely to higher long-term rates here domestically, which would impact mortgage rates, the cost of capital for corporations, and overall hurt asset prices.

[SPEAKER_00]: And so that's why he is diversifying and him going general, he's diversifying.

[SPEAKER_00]: So, there we go.

[SPEAKER_00]: That about does it.

[SPEAKER_00]: Appreciate you all tuning in this hour and if today's show made you think about your own financial picture in any way and your investments, your taxes, retirements and how it's all working in this forethurning, I encourage you to head over to invest.com, click on the portfolio review button and schedule time with myself or loot, please tell your friends and family about a free podcast down those, which you can find anytime at iTunes or Spotify or head over to our YouTube channel and check out those videos over there.

[SPEAKER_00]: Please be sure to rate and review on iTunes as well, of that, appreciate it.

[SPEAKER_00]: Independent thinking should success.

[SPEAKER_00]: It's a best talk.

[SPEAKER_00]: Enjoy, holiday, stand to begin.

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