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

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[SPEAKER_03]: Independent Thinking, shared success.

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

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[SPEAKER_03]: Here is KPP Financial Portfolio Manager, Luke Guerrero.

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

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[SPEAKER_00]: I'm your host Luke Rare, and I'll be with you on this Tuesday, January 27th, 2026.

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[SPEAKER_00]: Pretty crazy to think that this is the last Tuesday of the month of January of this year.

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[SPEAKER_00]: It seems every day.

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[SPEAKER_00]: keeps getting faster and faster.

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[SPEAKER_00]: Before we know it, we're going to be deep into 2026 and looking forward to the holidays.

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[SPEAKER_00]: But we shouldn't get too ahead of ourselves here.

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[SPEAKER_00]: There's certainly a lot that is going on that we need to pay attention to.

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[SPEAKER_00]: And so we hear it in Vestock.

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[SPEAKER_00]: See us as part of that daily mission.

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[SPEAKER_00]: To be able to decipher what is important.

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[SPEAKER_00]: from what is noise, to understand how all of these things affect our portfolios.

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[SPEAKER_00]: We do that through a mixture of educational items, actionable material, but you are the critical component that drives this show forward each and every day.

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[SPEAKER_00]: Without your finance and investment questions, we would have no idea what is on your mind.

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[SPEAKER_00]: That being said, in just a bit, we'll talk about today's market performance and run down those show topics we have for you today.

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[SPEAKER_00]: But let's tackle this color question now.

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[SPEAKER_06]: I'm calling in a question regarding the stock target, TGT.

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[SPEAKER_06]: I was looking to get your opinion on what you thought and what would be a good entry point.

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[SPEAKER_06]: Thanks.

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[SPEAKER_06]: I really enjoy your show and I'll be listening

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[SPEAKER_00]: Tigurity GT is target corporation, target corporation, of course, being a major US retail chain.

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[SPEAKER_00]: In fact, one of the largest in the country.

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[SPEAKER_00]: They sell general merchandise, close home goods, groceries, as of recently.

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[SPEAKER_00]: And they have a couple of thousand stores worldwide.

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[SPEAKER_00]: Very, very big company, $47 billion market cap company.

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[SPEAKER_00]: And frankly, in the past couple years, they've been in a bit of a rough spot in 2022, 2023, 2024, even last year.

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[SPEAKER_00]: They were underperforming not just the overall market, but their industry, as a whole as well.

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[SPEAKER_00]: They've been in hot water and, certainly, have not adapted as well as maybe a competitor like Walmart in transitioning from brick and mortar over towards

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[SPEAKER_00]: on line sales.

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[SPEAKER_00]: But in spite of that, the stocks rallied a bit over the past couple months, up to 6.47% over the past three months, year to date up 6.5, 0% though still underperforming its industry this year.

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[SPEAKER_00]: And what we've wanted to see here is a bit of a turnaround, right?

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[SPEAKER_00]: There's certainly more investor interest than there has been in quite some time.

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[SPEAKER_00]: A new CEO took over the companies investing into its store experiences into its technology, making operational changes such as cutting jobs, demore stream line processes.

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[SPEAKER_00]: And so Target has, I would say, been a bit more appealing recently.

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[SPEAKER_00]: than it has in quite some time, especially for a dividend investor.

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[SPEAKER_00]: Dividend yields at at 4% right now, margins.

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[SPEAKER_00]: low certainly margins are low the return on equity though 25.1% compare that to a CVS health or a dollar general or a dollar tree certainly higher than those names there and still trading at a pretty cheap valuation 13.6 times price to forward looking earnings.

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[SPEAKER_00]: So you know target which is a name that we hold in one of our strategies for our clients.

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[SPEAKER_00]: We hold it for one reason that it has been in such a poor position with such a good brand

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[SPEAKER_00]: products to customers that the renewed investor interest is understandable when you have changes that can really move the company for especially compared to some of its peers which are trading at very high valuation.

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[SPEAKER_00]: So for target corporation it has had a ugly run going into the end of last year but perhaps with a new CEO in charge with things starting to look like they're turning around and with a return on equity that is pretty attractive at low valuations.

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[SPEAKER_00]: might be a good name to hold.

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[SPEAKER_00]: That is target corporation, ticker, T, G, T. It's like we got our first live call, Chris from Atlanta.

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[SPEAKER_00]: You got a question about portfolio management.

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[SPEAKER_00]: How can we help you?

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[SPEAKER_07]: Hey, I was just asking, you know, listed to you guys, I'm started working on actually building a real portfolio and diversifying it as a plan and a small rough IRA that had just started the years ago.

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[SPEAKER_07]: Some of the names, like, I have, like, my Cron and Camillo, gone up, you know, my Cron's up, like 300% can make go 100%.

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[SPEAKER_07]: When is the right time to trim these out?

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[SPEAKER_07]: Like, I trimmed a little bit as I've gone and taken my cost faces out, you know, of course, looking at my Cron, continue to run, like, man, I should have left it in there.

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[SPEAKER_07]: But I'll use that money to that person.

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[SPEAKER_07]: How do you guys go about figuring out where to trim and read that first pot that money?

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[SPEAKER_00]: That's a great question because one of the hardest things to do is to understand when to trim those winters, right?

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[SPEAKER_00]: And in situations like this, you have a great momentum on a company like Micron, you know, you don't necessarily want to fully exit the position, but you do want to have certain constraints within your portfolio of what you're comfortable holding.

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[SPEAKER_00]: If you are on the riskier side, maybe that you let it trail up to 10%.

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[SPEAKER_00]: If you're not, I think six to eight percent is a pretty reasonable top level of where you might want to hold on to a name during its run.

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[SPEAKER_00]: So if it gets up to that eight percent, maybe you trim it back down to six.

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[SPEAKER_00]: If it gets up to that eight percent again, you trim it back down to six.

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[SPEAKER_00]: And it's difficult for us to then see, okay, well, this thing is still running, but I actually was talking with a client today who has made a good amount of money from their goal positions.

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[SPEAKER_00]: And why told him is that, you know, if you are a 90-year-old woman, 90-year-old man, and your portfolio was 100% in Nvidia of the past three years, you would have done really well.

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[SPEAKER_00]: Just because it worked doesn't mean it was the right thing to do.

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[SPEAKER_00]: And so having your mindset in saying, okay, we have these things they are running.

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[SPEAKER_00]: I'm doing well.

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[SPEAKER_00]: Now I'm going to start trimming and diversifying is absolutely the exact way you want to go about this because investing isn't just about returns.

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[SPEAKER_00]: It's about mitigating that risk as well.

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[SPEAKER_00]: Thanks for the call, Chris.

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[SPEAKER_00]: Great question.

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[SPEAKER_00]: Well, we're headed into a quick break.

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[SPEAKER_00]: Please remember you can call any time and leave your questions on the Invest Talk voice bank.

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[SPEAKER_00]: If you're listening via our live stream or possibly on a M1220 in the Bay Area, follow Chris's example, give me a call now at 888-99-Journey.

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[SPEAKER_04]: Sirious investors are certain to have finance and investment questions.

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[SPEAKER_05]: I'm looking at an EPS in Goldman Sachs Nasdaq.

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[SPEAKER_04]: And the best person to ask your question in the right way is you.

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[SPEAKER_04]: If that would be a good hold to having a Roth IRA for the long-term horizon.

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[SPEAKER_04]: And 24-7 rain or shine, Justin Klein and Luke Guerrero stand ready to provide their unbiased answers.

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[SPEAKER_04]: This isn't really a copper plate.

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[SPEAKER_04]: This is a iron ore plate with some aluminum copper.

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[SPEAKER_00]: If you're looking at each of the whole so few names that are so top-heavy, I think it is probably ill-advised to pay.

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[SPEAKER_00]: An expense ratio like this in order to get exposure that you could really get yourself.

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[SPEAKER_04]: Your participation makes an invest talk better.

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[SPEAKER_10]: Hey guys, Brian from Rookerhanna here.

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[SPEAKER_10]: I'm a big fan of the show.

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[SPEAKER_10]: I have a missing episode in number five years.

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[SPEAKER_04]: So don't forget to call in Vestark, 888-99 chart.

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[SPEAKER_04]: Have you heard about Parallel Investing?

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[SPEAKER_04]: 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.

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[SPEAKER_04]: Learn more anytime at InvestTalk.com just click on portfolio review.

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[SPEAKER_04]: The Invest Talk phone lines are open, waiting for your financial investment questions.

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[SPEAKER_04]: 888-99 chart.

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[SPEAKER_00]: Go out and count to cover over the next 40 minutes or so.

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[SPEAKER_00]: And here's a little bit of what we have.

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[SPEAKER_00]: A pre-planned for you all.

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[SPEAKER_00]: The first is our main focus point.

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[SPEAKER_00]: which is about the forever-venture economy.

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[SPEAKER_00]: Despite stabilizing home ownership rates for younger demographics have hit new lows, we will talk about the rise of build-to-run communities and the long-term economic shift away from home ownership.

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[SPEAKER_00]: Also, a couple more stories should we have time, including one on the dollars continued slide, and the President saying he's not concerned about the recent decline.

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[SPEAKER_00]: Another story we tried to get to yesterday, but didn't quite have time to do about the U.S. investment grade credit spreads and how they're reaching the lowest levels of this century.

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[SPEAKER_00]: and maybe if we got enough time we'll touch on consumer confidence and how does dove to a more than 11 and a half year low?

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[SPEAKER_00]: As always we also have some calls that came in earlier to the investor talk of voice bank including one on and on in which I think we answered one yesterday maybe this is a follow-up who knows.

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[SPEAKER_00]: Another on selling losses versus taxes.

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[SPEAKER_00]: As always, we asked some comments from the comment section of the US talking YouTube channel, and hopefully some more live calls throughout the show.

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[SPEAKER_00]: Alright, let's talk a little bit about the market today before we move any further.

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[SPEAKER_00]: Pretty mixed overall, though, the, you know, S&P was a higher ending a bit off of its best levels, posted a fresh all-time high than as that composite now, only 50 basis points off its October 25 record close.

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[SPEAKER_00]: Overall, the Dow is down 83 basis points on the day, S&P 541, NASDAQ 91, Russell 2000, up 26 basis points.

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[SPEAKER_00]: Leading the way the max 7 mostly higher, high beta names higher, momentum higher, semi-s outperform software by more than 4 percentage points on the day.

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[SPEAKER_00]: Other performers included networking and communication names, pharma, biotech, some select hospitals

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[SPEAKER_00]: Small caps, relative underperformer for the third straight session, other out of performers included managed care, steel, trucking, and manufacturing airlines, credit cards, and insurance.

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[SPEAKER_00]: On the bond side, treasuries were mixed, you did see a bit of curve steepening the 30-year yield up four basis points on the day near its session highs.

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[SPEAKER_00]: While the dollar index was down 1.4% it saw its worst day since April of last year, and its lowest levels since February of 2022, gold vanished fractionally higher silver, ending down 8.3% paying some of those Monday gains, where it was up 14% and crude oil settling up 2.9% on the day.

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[SPEAKER_00]: The big story, growth momentum, tech outperformed during the session,

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[SPEAKER_00]: Economic calendar also showing a bit of focus with softer consumer confidence prints, really the softest print in 11 years, giving some curve steepening at a bit of a pickup in fed easing expectations, plus about four basis points from last Friday to around 45 on the year.

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[SPEAKER_00]: bit of a mixed batch of earnings though really the market is more focused on those big tech results that are going to start to filter in on Wednesday.

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[SPEAKER_00]: The other big corporate story revolved around the managed care sell-off on the news that CMS had a bit of a rate proposal lower than what some would have expected to save a least.

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[SPEAKER_00]: And you know overall more tariff bluster, Trump's tariff threat on South Korea seems to be largely ignored as do the still elevated

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[SPEAKER_00]: shut down.

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[SPEAKER_00]: Diving a bit deeper into economic data, January consumer confidence down sharply to its lowest level since May of 2014, with both present situations and expectations indices.

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[SPEAKER_00]: Down.

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[SPEAKER_00]: Labour Market differential also worsened its narrowest level since March of 2021.

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[SPEAKER_00]: January Fit Richman Fed Index also missed as the unemployment index worsened and prices paid was up slightly though prices received a bit lower.

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[SPEAKER_00]: On the job side, ADP weekly private payrolls of 7,7500 average over the past four weeks, the slowest since late November.

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[SPEAKER_00]: Looking ahead, FOMC decision and pal press conference will be on Wednesday.

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[SPEAKER_00]: There's day brings the final Q3 unit labor cost initial claims for weeks ended January 24th in the November trade balance and factory orders.

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[SPEAKER_00]: day.

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[SPEAKER_00]: Keep going and play another listener question from 80 to 99 chart.

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[SPEAKER_08]: This other question about how people sell stocks in order to write off taxes in the case that they're at a loss in a certain security.

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[SPEAKER_08]: Could you explain a little bit about that and how much you're able to sell and a lot in order to write it off in the digital brokerage account?

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[SPEAKER_08]: Thank you.

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[SPEAKER_00]: It's a great question.

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[SPEAKER_00]: So first and foremost, it does have to be an a taxable account.

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[SPEAKER_00]: And the idea here is, if you are at a capital loss relative to your cost basis on a security, you can sell.

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[SPEAKER_00]: You must wait for the war sale period, 31 days before you buy back that name or a name similar to it.

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[SPEAKER_00]: Meaning a security that is, for example, you know, if you had an A share of Google and you sold it, you couldn't buy B shares what I'm saying there.

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[SPEAKER_00]: So that's what like exposure means.

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[SPEAKER_00]: It doesn't mean you can't sell Chevron and buy X on, but when you sell this and you wait the requisite wash period, you recognize the value of that loss.

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[SPEAKER_00]: Now, it can offset up to $3,000 if income in any given year.

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[SPEAKER_00]: It can offset short-term gains, long-term gains.

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[SPEAKER_00]: It doesn't matter and

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[SPEAKER_00]: If you don't have games you offset, guess what?

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[SPEAKER_00]: You carry it forward.

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[SPEAKER_00]: It's called a capital loss.

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[SPEAKER_00]: Carry forward.

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[SPEAKER_00]: So the benefit here being well, maybe I'm down on a couple names.

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[SPEAKER_00]: I for some reason don't like the name anymore.

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[SPEAKER_00]: I want to exit the position or I think over the next 31 days, it's not going to move.

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[SPEAKER_00]: Therefore, I'm going to recognize the loss.

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[SPEAKER_00]: Now, and benefit from the tax consequences of that loss.

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[SPEAKER_00]: Tax management is a good idea to do in your portfolio.

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[SPEAKER_00]: It helps you have a better investment experience on the along the way.

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[SPEAKER_00]: And really, in down years, you can benefit from a tax perspective as well.

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[SPEAKER_00]: Going into another break, still to come my main focus point on the forever rent or economy.

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[SPEAKER_00]: Couple more talking points and more answers to your finance and investment questions.

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[SPEAKER_00]: If you feel like talking to me any time over the next 30 minutes or so, I guess we got about 40 minutes left in this show.

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[SPEAKER_00]: Feel free to pick up that phone, give me a call, you know the number?

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[SPEAKER_00]: 888-99 chart.

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[SPEAKER_04]: In the early days, in Vestock was Jerry Klein and Steve Peasley.

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[SPEAKER_04]: Now the torch has been passed and a new generation of hosts is on the job, Justin Klein and Luke Guerrero.

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[SPEAKER_04]: So when you've got finance and investment questions, don't forget to call in Vestock.

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[SPEAKER_04]: 888-99-Chart

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[SPEAKER_00]: real estate real estate.

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[SPEAKER_00]: We're moving into an area where we may be thinking about calling it the forever renter economy and we're not just talking about home ownership.

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[SPEAKER_00]: We're talking about commercial properties as well.

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[SPEAKER_00]: As 2026 approaches, commercial real estate is quietly regaining its footing after several volatile years.

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[SPEAKER_00]: The tone across the market has shifted from caution to cautious optimism driven by improving fundamentals and renewed capital availability.

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[SPEAKER_00]: In 2025, equity fund raising and transaction activity began to recover a bit, setting the stage for a more active deal environment for the year ahead.

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[SPEAKER_00]: Now heading into 2026, both capital market and property level fundamentals are aligning more favorably across several major asset classes.

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[SPEAKER_00]: So let's talk a little bit about that.

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[SPEAKER_00]: One thing note is important to note is it doesn't necessarily mean risks have disappeared, but it does mean investors are no longer frozen by uncertainty.

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[SPEAKER_00]: Macroeconomic and political disruptions do remain a factor especially after last year's extended federal government shutdown, but the shutdown disproportionately affected community development real estate, delaying projects that rely on federal funding and CDFIs.

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[SPEAKER_00]: Even with temporary funding extensions in place, the risk of another shutdown continues to weigh on investor confidence and so policy uncertainty is there.

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[SPEAKER_00]: Around regulation, around immigration, around tariffs, around inflation, interest rates, and it's all shaping underwriting assumptions.

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[SPEAKER_00]: Carifs have already raised cost for key construction inputs like steel, like aluminum, like copper, like

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[SPEAKER_00]: other things and squeezing development economics and so you think about this from a supply site if it becomes more expensive to build office space it becomes more expensive to build multi-family housing if it becomes more expensive to build

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[SPEAKER_00]: single family units, well then supply doesn't necessarily get unconstrained and costs will continue to rise.

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[SPEAKER_00]: And so in this type of economic environment, it's understandable that people are thinking that, well, home ownership rates for younger demographics, they're going to continue to stay low.

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[SPEAKER_00]: and therefore this build to rent communities, this proliferating makes a lot of sense.

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[SPEAKER_00]: Labor availability, that's another pressure point.

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[SPEAKER_00]: As immigration policy influences construction wages and project timelines, but despite these headwins, several sectors are showing real resilience.

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[SPEAKER_00]: Office.

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[SPEAKER_00]: Long considered the problem-child of commercial real estate, especially in the wake of, a move to work from home, is beginning to rebound a bit selectively.

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[SPEAKER_00]: Los Angeles, San Francisco, Midtown Manhattan, top to office assets there, are seeing a bit stronger demand and record rent levels once again, but the common thread here amongst office space, multi-family apartments, all of these things, is quality.

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[SPEAKER_00]: modern energy efficient buildings with wellness features and advanced technology.

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[SPEAKER_00]: They're attracting tenants.

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[SPEAKER_00]: Lower quality by contrast faces a lot of obsolescence risk and is increasingly likely to be repurposed rather than renovated.

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[SPEAKER_00]: Multifamily, in fact, remains one of the strongest pillars of the commercial real estate market entering this year, debt capital is abundant, supported by higher lending caps and continued institutional appetite, the underlying supply demand imbalance in housing, as I mentioned, it hasn't changed, especially in these large coastal cities, millions of rental households, remain cost burden, which continues to support occupancy and support rent stability.

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[SPEAKER_00]: Even if job growth softens, structural under supply should limit the downside risk for multifamily rents if you're thinking about investing in real estate.

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[SPEAKER_00]: Industrial Real Estate

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[SPEAKER_00]: On the other hand, it's cooling off of it from its post-Pandemic highs.

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[SPEAKER_00]: But in spite of that, fundamental still remain strong.

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[SPEAKER_00]: The demand for manufacturing, the demand for warehousing, the demand for logistics space.

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[SPEAKER_00]: It's continuing to benefit from on-shoring trends from near-shoring trends, and industrial strength is closely tied to retail performance, which has been, frankly, quietly, robust.

20:26.911 --> 20:32.501
[SPEAKER_00]: Grocery anchored in neighborhood shopping centers are posting some of these strongest valuations in years.

20:33.142 --> 20:40.836
[SPEAKER_00]: Limited new retail supply is steady consumer spending, are providing these powerful tailwinds that are helping these areas of the real estate market.

20:41.187 --> 20:48.676
[SPEAKER_00]: Across sectors, cyber security, fraud prevention, or becoming essential operational priorities as digital payments are starting to expand.

20:49.497 --> 21:02.592
[SPEAKER_00]: Taken together, 2026 looks less like a rebound driven by speculation, and more like a fundamentals based recovery, potentially across the real estate sector.

21:02.612 --> 21:05.355
[SPEAKER_00]: But, as always, and we talk about this all the time.

21:06.567 --> 21:20.103
[SPEAKER_00]: Not only within real estate do things tend to be disparate and they're effect across various sub-industries, the multifamily, commercial, industrial, et cetera, et cetera, but also across geographic locations.

21:20.163 --> 21:28.072
[SPEAKER_00]: Commercial real estate is not booming everywhere, but resilience across these industries suggest opportunity is steadily returned.

21:29.514 --> 21:35.140
[SPEAKER_00]: So though, it seems more and more build to rent communities,

21:36.166 --> 21:42.634
[SPEAKER_00]: or causing a longer-term economic shift, it doesn't mean from an investor standpoint, there aren't unique opportunities.

21:43.696 --> 21:48.783
[SPEAKER_00]: On the next investor, we'll dig into this story, the zombie company Purge.

21:49.584 --> 21:54.570
[SPEAKER_00]: Bank Ripsies are taking up among companies that can only survive on near zero interest rates.

21:55.111 --> 22:00.638
[SPEAKER_00]: So how do you spot these zombies by looking at their balance sheet before the company collapses?

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[SPEAKER_00]: That's tomorrow, but for now, I'm Luke Guerrero, and we are ready to take your calls at 888-99 chart.

22:07.337 --> 22:09.868
[SPEAKER_00]: Jasmine from San Jose, Hang on, you will be next.

22:19.636 --> 22:33.133
[SPEAKER_04]: millions of downloads have proved there's value in every investor podcast call anytime 24 seven investor 88 99 chart.

22:35.395 --> 22:37.158
[SPEAKER_00]: It's good at Jasmine from San Jose.

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[SPEAKER_00]: He's got a very important question.

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[SPEAKER_00]: How can I help you Jasmine?

22:41.763 --> 22:42.164
[SPEAKER_02]: Hello.

22:42.885 --> 22:47.230
[SPEAKER_02]: I'm 15 and can you tell me like advice like on how

22:47.598 --> 22:51.769
[SPEAKER_02]: or like, how would I start investing first, like, in the sophomore year?

22:52.762 --> 22:54.285
[SPEAKER_00]: That is a great question.

22:54.325 --> 23:00.294
[SPEAKER_00]: And certainly you're already on the right track, given that you're only 15 years old.

23:00.375 --> 23:03.460
[SPEAKER_00]: So congratulations for really being ahead of a lot of people you're age.

23:03.520 --> 23:09.269
[SPEAKER_00]: Now, the first thing you can do, certainly if you are employed, is think about where you want to store your money, right?

23:09.289 --> 23:17.723
[SPEAKER_00]: Anybody can get a taxable brokerage account, but the benefit of being employed and getting employment income is in those tax deferred accounts.

23:17.703 --> 23:27.355
[SPEAKER_00]: So assuming that you make under the Roth IRA limit, which certainly you would as a working teenager, that is one of the best vehicles for growth.

23:27.896 --> 23:33.303
[SPEAKER_00]: The reason being is you put money in there on a post tax basis and it can grow tax-free.

23:33.683 --> 23:37.909
[SPEAKER_00]: Somebody who's a teenager working inherently has a low tax rate to begin with.

23:38.630 --> 23:45.178
[SPEAKER_00]: So effectively you can grow and use compounding as your friend over decades before your retirement.

23:46.255 --> 24:00.350
[SPEAKER_00]: One of the best things you can do is side from investing is having a fundamental understanding of the worth of money, getting an idea of how one can financially plan the things that you should be spending money on, the things you shouldn't be spending money on.

24:00.851 --> 24:06.737
[SPEAKER_00]: Time is always your friend in the investment game, and certainly given how young you are, you are ahead of the curve.

24:07.458 --> 24:08.800
[SPEAKER_00]: Thanks to the College of Asmond, have a great day.

24:09.480 --> 24:11.082
[SPEAKER_02]: Oh, thank you.

24:12.277 --> 24:16.000
[SPEAKER_00]: already let's pivot back to the investor of voice bank for this call that came in earlier.

24:16.741 --> 24:21.485
[SPEAKER_01]: Hi there my name is Duncan Forbes from New York long time listener thank you for everything.

24:21.745 --> 24:30.413
[SPEAKER_01]: I am calling about stock ticker a on a a o and I've actually had this for a while now.

24:30.893 --> 24:41.963
[SPEAKER_01]: My total gain has only been about 11% and because it's a new year I'm trying to see if I should

24:42.331 --> 24:49.164
[SPEAKER_01]: but in terms of like the technical analysis, it seems like in the past six months, there is somewhat of a trend upwards.

24:49.725 --> 24:55.636
[SPEAKER_01]: So I already have VRT, which kind of did the same thing as like what this thought does.

24:55.716 --> 25:01.587
[SPEAKER_01]: So I'm just trying to convince, trying to just get some more liquidity in my portfolio.

25:01.647 --> 25:03.310
[SPEAKER_01]: So looking for any help.

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[SPEAKER_01]: looking for the answer.

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[SPEAKER_01]: Have a great day.

25:05.420 --> 25:06.060
[SPEAKER_01]: Bye, thank you.

25:06.581 --> 25:09.125
[SPEAKER_00]: A-on, ticker, A-A-O-N.

25:09.145 --> 25:13.211
[SPEAKER_00]: I think as a name, we actually talked about yesterday on the show, but we'll go through it again.

25:13.291 --> 25:18.698
[SPEAKER_00]: It designed manufacturers and cells commercial and industrial age-fact systems.

25:18.718 --> 25:20.621
[SPEAKER_00]: It operates in the US and operates in Canada.

25:21.202 --> 25:28.672
[SPEAKER_00]: And it serves a bunch of markets from commercial buildings, to data centers, to industrial facilities, and various specialty applications.

25:28.752 --> 25:33.499
[SPEAKER_00]: Now, one of the reasons why it is up 20.47%

25:33.479 --> 25:58.542
[SPEAKER_00]: year-to-date is, well, margins have been looking a bit better, it expanded its credit facility, they reported a record backlog of $1.32 billion in projects, and so on the back of a rough

25:59.197 --> 26:09.446
[SPEAKER_00]: Because of that momentum looks very strong here, but there are risks, there's profit margin risks, there's execution risks as things become a bit more expensive or you're gonna see margins fall.

26:09.466 --> 26:14.170
[SPEAKER_00]: I mean, right now, return on equity has been slipping year over year from 2023 down from 27.4.

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[SPEAKER_00]: All the way to what was projected to be 13.2 this upcoming announcement, which will be in February, four fiscal year end December 25th.

26:23.658 --> 26:29.203
[SPEAKER_00]: Now, the thing that worries me the most here is yes, it has ridden in some ways over the past three years,

26:29.183 --> 26:38.940
[SPEAKER_00]: A lot of the increase in industrial spending related to databases, and there's been some really strong growth, especially from the BASX product.

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[SPEAKER_00]: But it's a bit expensive.

26:41.155 --> 26:44.118
[SPEAKER_00]: Price for looking at earnings 45.1 times.

26:44.959 --> 26:53.068
[SPEAKER_00]: And I mean, it did have a huge run up this year on the back of that poor performance, where you had a bit of a technical breakdown in the beginning of 2025.

26:53.569 --> 27:03.560
[SPEAKER_00]: So for me, if you're up on this, if you're profitable on this, I'd probably look to diversify elsewhere, something a bit less expensive that hasn't really struggled with some of the cost issues that this name has.

27:03.600 --> 27:07.965
[SPEAKER_00]: That is A on ink ticker, A, A, O, and thanks to the call.

27:08.435 --> 27:12.158
[SPEAKER_00]: While we're at it, why don't we grab a YouTube question?

27:12.218 --> 27:24.569
[SPEAKER_00]: This one from our dear friend, Randy Ramos, who likes to ask questions on YouTube, and I think you should too as well, because it's a great avenue to continue your learning outside of our daily podcast.

27:24.589 --> 27:34.298
[SPEAKER_00]: We do provide really YouTube specific content on there that seems to always be applicable to everybody's life no matter when you watch that video.

27:34.318 --> 27:36.400
[SPEAKER_00]: And so this question was,

27:36.616 --> 27:57.493
[SPEAKER_00]: Or rather, it says, I was listening to your podcast episode from January 16th regarding cyber security companies, and I feel the same way you do about finding up in commerce in the industry to topple the crowdstrikes of the world, and have recently bought to names one of Sentinel-1, which I feel has a tremendous amount of upside, and they're continuing to steal market share and have an overall better product.

27:57.934 --> 27:59.637
[SPEAKER_00]: The other is a rubric.

28:00.713 --> 28:05.780
[SPEAKER_00]: This type in a rubric here, which is Tipper ticker RBRK.

28:06.461 --> 28:12.449
[SPEAKER_00]: So I also feel it has a huge team within a niche that has relies on cyber resilience.

28:13.391 --> 28:19.199
[SPEAKER_00]: I paired them together because of their offerings based on different and more complimentary versus competitive.

28:19.219 --> 28:21.021
[SPEAKER_00]: Would love to hear your take on these two names.

28:21.622 --> 28:21.943
[SPEAKER_00]: Thank you.

28:22.443 --> 28:23.124
[SPEAKER_00]: Big question.

28:23.765 --> 28:26.689
[SPEAKER_00]: Let's give you a big answer.

28:27.030 --> 28:28.712
[SPEAKER_00]: So a Sentinel one.

28:29.738 --> 28:38.629
[SPEAKER_00]: Is a, well, they're both really cyber security company Sentinel one is more focused on end point and cloud protection whereas rubric is more backup and recovery.

28:38.669 --> 28:41.173
[SPEAKER_00]: So think software as a service protection.

28:41.193 --> 28:54.530
[SPEAKER_00]: They're both of a similar age here in terms of when the company has existed both founded in 2013 rubric IPO in 2024, meaning it's now passed that restriction that I usually place for anybody on when you should buy something.

28:54.550 --> 28:58.615
[SPEAKER_00]: You shouldn't really buy anything within a year of when it starts trading, but it's past that now.

28:58.595 --> 29:00.958
[SPEAKER_00]: Sentinel-1, bit earlier traded in 2021.

29:01.158 --> 29:06.746
[SPEAKER_00]: Now in terms of profitability, you know, for rubric, it's still a negative.

29:06.766 --> 29:08.088
[SPEAKER_00]: It's still a negative sum game here.

29:08.649 --> 29:14.957
[SPEAKER_00]: Even margin, sitting at negative 127.9%, projected to have been negative 4%.

29:15.518 --> 29:19.503
[SPEAKER_00]: We'll see what that comes out in March as of this most recent quarter.

29:20.685 --> 29:23.168
[SPEAKER_00]: But at the same time, let me put Sentinel-1 here.

29:24.127 --> 29:27.677
[SPEAKER_00]: At the same time, Sentinel-1 has a bit of a different story.

29:27.697 --> 29:32.993
[SPEAKER_00]: They're projected to have finally made money this year, 6.5% net margin, return on equity hitting 4.1%.

29:33.133 --> 29:39.351
[SPEAKER_00]: So you know amongst these two names, you have similar stories here.

29:39.331 --> 29:48.367
[SPEAKER_00]: One sentinel one, you have narrow positivity for the first time, rubric, you still have these gap net losses that are persisting.

29:48.387 --> 30:02.352
[SPEAKER_00]: Now send a one top line growth surpassed about 24% on an annualized basis, or rather 24% year over year in mid 2025, a sign of finally some traction within its renewing subscription.

30:03.665 --> 30:10.536
[SPEAKER_00]: some of its quarters beat expectations within profitability, but that really hasn't happened in a sustainable way that we would like to see.

30:10.837 --> 30:16.223
[SPEAKER_00]: Rubric also has massive revenue growth, 55% year over year.

30:16.243 --> 30:25.053
[SPEAKER_00]: I think overall, Rubric is a newer company in terms of its trading, higher growth, subscription focus, with more aggressive growth metrics.

30:25.373 --> 30:28.657
[SPEAKER_00]: But both of these names are on the risky side of the business.

30:28.697 --> 30:30.659
[SPEAKER_00]: So I don't have a problem holding these names.

30:30.679 --> 30:33.703
[SPEAKER_00]: They're certainly on an upswing from a fundamental perspective.

30:33.723 --> 30:37.367
[SPEAKER_00]: They've sent no ones, price certainly isn't showing any momentum at all.

30:37.347 --> 30:43.054
[SPEAKER_00]: But if you're going to hold them, I think holding them at a very low weight would be wise, that is Sentinel 1 and Rubric.

30:43.635 --> 30:44.256
[SPEAKER_00]: Thanks for watching.

30:45.197 --> 30:57.073
[SPEAKER_00]: Talk a little bit about the US dollar, and most importantly, how it's slid pretty sharply again, falling about 1.3% against major currencies and sinking to its weakest level in four years.

30:58.394 --> 31:05.143
[SPEAKER_00]: A lot of that was, well, investor reaction to the president's comments that were a bit dismissive about the dollar's decline.

31:05.579 --> 31:15.240
[SPEAKER_00]: Trump said he was unconfirmed about the dollar's drop, calling it great, remarks that appear to reinforce market fears that the administration is comfortable with a weaker currency.

31:16.223 --> 31:22.356
[SPEAKER_00]: Since the start of this year, the dollar is down about 2.6% with investors increasingly uneasy about

31:22.960 --> 31:33.857
[SPEAKER_00]: say erratic policymaking, geopolitical tensions, and the erosion of US institutional credibility, the euro, the sterling have searched to multi-year highs.

31:34.257 --> 31:39.145
[SPEAKER_00]: With the euro rising to $1.20, $4 in the pound to $1.384.

31:39.726 --> 31:46.736
[SPEAKER_00]: Levels not seen since 2021 as capital started to rotate out of dollar assets.

31:46.756 --> 31:48.058
[SPEAKER_00]: We've talked about this all the time.

31:48.098 --> 31:49.761
[SPEAKER_00]: If you look at the return of the SMP,

31:49.741 --> 31:52.167
[SPEAKER_00]: And at 2025, looks great.

31:52.468 --> 31:55.696
[SPEAKER_00]: If you look at it at a dollar-justed basis, doesn't look so great at all.

31:56.017 --> 32:00.949
[SPEAKER_00]: That's why international markets have outperformed or rather outperformed so greatly last year.

32:01.705 --> 32:06.331
[SPEAKER_00]: Another thing that happened will have been assets rallied hard alongside the dollar sell off gold.

32:06.611 --> 32:15.283
[SPEAKER_00]: As we talked about yesterday, jumped 3.5% above that $5,000-ounce level silver spiked as well before falling again today.

32:16.024 --> 32:20.790
[SPEAKER_00]: Now, let's say the move reflects a bit of broader loss of confidence in U.S. policy.

32:21.231 --> 32:31.324
[SPEAKER_00]: Gohere, it's especially following renewed clashes with allies and uncertainty around trade, defense, currency strategy, and the overall independence of the Federal Reserve.

32:31.304 --> 32:38.736
[SPEAKER_00]: speculation that the U.S. might tolerate or even encourage dollar weakness to boost export competitiveness has also added fuel to this sell-off.

32:39.317 --> 32:51.017
[SPEAKER_00]: Rumors of potential U.S. Japan currency intervention to support the end further kind of rattled markets a bit signaling that exchange rates stability may no longer be a priority for Washington.

32:51.098 --> 32:56.363
[SPEAKER_00]: Strategists kind of describe the Euro as the anti-dollar trade.

32:56.383 --> 33:03.170
[SPEAKER_00]: It benefits directly from global diversification away from US assets rather than from Eurozone strength.

33:03.691 --> 33:07.835
[SPEAKER_00]: A lot that said, improving your P&D has helped there, right?

33:07.915 --> 33:10.918
[SPEAKER_00]: Germany has posted its first annual growth since 2022.

33:11.839 --> 33:20.127
[SPEAKER_00]: And there are signs of bit of an emerging tentative economic recovery.

33:20.596 --> 33:29.867
[SPEAKER_00]: reality that political risks in Europe, they've used a bit, particularly in France, we're shrinking bond spreads versus Germany suggests a bit of a calmer investor environment.

33:31.189 --> 33:43.663
[SPEAKER_00]: With JP Morgan amongst others warning that these structural reasons for dollar weakness remain intact, many investors now see the greenbacks decline, not as a short-term wobble, but as a defining macro trend of 2026.

33:44.104 --> 33:49.270
[SPEAKER_00]: Skipping is moving and drop in another investor talk, a listener question now.

33:49.908 --> 33:58.059
[SPEAKER_09]: I'm talking about company Strandmatic Stroop, Take her T-M-D-X to provide any info.

33:58.762 --> 34:00.930
[SPEAKER_09]: Appreciate it, and I'll be listening, next.

34:01.822 --> 34:04.747
[SPEAKER_00]: TMDX is transmedics group.

34:04.767 --> 34:10.937
[SPEAKER_00]: It is a med tech company that focuses specifically on organ transplant plant care systems.

34:11.598 --> 34:18.830
[SPEAKER_00]: What they do is it keeps donor organs viable outside the body using proprietary profusion and monitoring technology.

34:19.231 --> 34:22.176
[SPEAKER_00]: It's called the organ care system or what they call it OCS.

34:23.540 --> 34:31.529
[SPEAKER_00]: Now, it's really a little bit small company about $4 to $5 billion market cap currently sitting at $5.8 billion market cap.

34:31.909 --> 34:37.415
[SPEAKER_00]: It's got a little debt but not too much about $515 million in the biggest thing here is the revenue growth.

34:37.435 --> 34:49.868
[SPEAKER_00]: From $25.6 million in 2020, to $441.5 million in 2024, 600.7 million is where it's projected to have done through fiscal year end December 2025.

34:50.860 --> 34:56.628
[SPEAKER_00]: So you have very, very solid revenue growth, 79.6% on an annual basis.

34:56.668 --> 34:59.773
[SPEAKER_00]: You have solid growth and profitability.

35:00.053 --> 35:01.495
[SPEAKER_00]: They turned a profit in 2024.

35:02.977 --> 35:07.944
[SPEAKER_00]: Net margins projected to grow from eight percent, to roughly 15.9% in 2026.

35:08.505 --> 35:20.462
[SPEAKER_00]: Even to margin and turn growing from 13 to 23.9 return equity, projected to grow from 19.4 to 22.4.

35:22.096 --> 35:28.367
[SPEAKER_00]: With this turn to profitability, the understandably priced afford looking earnings is trading a bit high here, 47.4 times.

35:28.407 --> 35:35.679
[SPEAKER_00]: Now because they didn't turn a profit in this past five years, this range I'm seeing from 36.1 to 6,387, it's a bit unrealistic.

35:35.699 --> 35:43.593
[SPEAKER_00]: But it is trading at 13.4 times, price to book value, trading at 10 times sales, 31.9 times price to cash flow.

35:43.613 --> 35:44.374
[SPEAKER_00]: So,

35:44.624 --> 36:04.168
[SPEAKER_00]: You know, the company's core organ systems, it has addressed a clinical need, it improves organ vitality, it improves transplants, outcomes, you know, one of the issues here because of how serious this is from a medical perspective is, well, competitors have a bit of a tough time.

36:04.317 --> 36:06.362
[SPEAKER_00]: getting their products to market as well.

36:06.382 --> 36:08.948
[SPEAKER_00]: There's a bit of an entrenched mode here.

36:08.988 --> 36:09.991
[SPEAKER_00]: That's the reason why.

36:10.031 --> 36:13.078
[SPEAKER_00]: One of the reasons why, over the past of two weeks, it's up 126.77%.

36:13.098 --> 36:19.954
[SPEAKER_00]: Up 13.64% year-to-date.

36:21.438 --> 36:22.360
[SPEAKER_00]: And so this,

36:24.247 --> 36:51.908
[SPEAKER_00]: expansion of its clinical use cases from heart to the liver to the lungs could support long-term growth here if adoption continues to expand and so you can continue to see this expansion of revenue this expansion of profitability and because of this though it does trade at a pretty decent premium to its valuation so of gross slows of execution falters if a new competitor does come into place you can find yourself in a position where

36:52.394 --> 36:58.107
[SPEAKER_00]: Well, the stock may underperform the industry as a whole.

36:58.127 --> 36:59.049
[SPEAKER_00]: Overall, I like this thing.

37:01.013 --> 37:08.850
[SPEAKER_00]: It doesn't pay dividend, but it has a lot of growth here, a lot of strong history of revenue and earnings beats historically.

37:09.050 --> 37:11.653
[SPEAKER_00]: And so, it is incredibly attractive.

37:11.673 --> 37:13.916
[SPEAKER_00]: Unfortunately, it's a bit expensive.

37:14.016 --> 37:19.624
[SPEAKER_00]: So, you know, overall, it's about as expensive as it could be, right?

37:19.644 --> 37:21.306
[SPEAKER_00]: It's 31.9 times price to cashflow.

37:21.626 --> 37:27.934
[SPEAKER_00]: So, for now, I'd keep it on my watch list, but if this technical momentum continues, certainly, I would be quick to buy.

37:28.455 --> 37:33.081
[SPEAKER_00]: That it's Transmedics Group, ticker TMDX, thanks to the call.

37:34.002 --> 37:36.205
[SPEAKER_00]: Now, we're already talked about it a little bit.

37:36.488 --> 37:44.459
[SPEAKER_00]: because we did answer a question from the invest talk at YouTube channel, but I do want to plug it one more time because I think it is and can be a great resource.

37:45.480 --> 37:54.012
[SPEAKER_00]: We used to just post the show in full, but we have since broken up what we considered to be the most applicable, the most important segments of this podcast, so you can repurpose them.

37:54.032 --> 37:54.833
[SPEAKER_00]: You can watch them.

37:54.873 --> 37:57.136
[SPEAKER_00]: You can see the charts that we're looking at.

37:57.176 --> 38:05.027
[SPEAKER_00]: You can see some of the data that we're looking at, how it helps us come to the conclusions about various stocks, various questions, how we get there.

38:05.834 --> 38:13.126
[SPEAKER_00]: Not only that, we also have a bit of evergreen content, some classroom series, some explanations about sector dynamics, of course, our holiday special.

38:13.627 --> 38:21.000
[SPEAKER_00]: And through 2026, we do make a pledge to bring you as much educational content over on our YouTube as we possibly can.

38:21.060 --> 38:29.614
[SPEAKER_00]: So I encourage all of you, aside from also listening to our podcast, go over check out our YouTube content just search Invest Talk with two teas.

38:31.906 --> 38:34.835
[SPEAKER_00]: This is Invest Talk, I'm Lou Greer, we have one goal here.

38:35.478 --> 38:36.401
[SPEAKER_00]: It's our goal each and every day.

38:36.922 --> 38:38.588
[SPEAKER_00]: To help you achieve your financial freedom.

38:39.430 --> 38:41.597
[SPEAKER_00]: Our work continues after this break, our final break.

38:41.617 --> 38:45.510
[SPEAKER_00]: So get your questions in now at 888-99 chart.

38:55.666 --> 39:22.450
[SPEAKER_04]: investor tell your friends they can listen live download the free podcast or watch invest talk on our YouTube channel and they can leave their finance and investment questions anytime on 888 99 chart hi thank you for taking this call I have a

39:22.868 --> 39:36.402
[SPEAKER_10]: us by their sectors equal weighted, I'm thinking about this as a way to avoid tech concentration and also pick up sectors that are perhaps under where I'll usually give in time.

39:36.962 --> 39:38.124
[SPEAKER_10]: Would love to know your opinion.

39:38.284 --> 39:38.604
[SPEAKER_10]: Thank you.

39:39.345 --> 39:43.129
[SPEAKER_00]: EQL is the Alps equal sector weight ETF.

39:43.149 --> 39:52.318
[SPEAKER_00]: So effectively all that it's doing is it uses a fund of funds approach to investing by

39:53.530 --> 39:59.693
[SPEAKER_00]: So you effectively get a large cap portfolio made up of 13 holdings equally weighted.

40:01.006 --> 40:02.027
[SPEAKER_00]: based on the very sector.

40:02.047 --> 40:03.389
[SPEAKER_00]: So absolutely not.

40:04.010 --> 40:10.680
[SPEAKER_00]: The reason being is you are paying a 27 basis point net expense ratio to do something you could absolutely do yourself.

40:10.740 --> 40:12.362
[SPEAKER_00]: These ETFs are publicly available.

40:13.383 --> 40:15.306
[SPEAKER_00]: They do not rebalance them every day.

40:15.366 --> 40:25.360
[SPEAKER_00]: They rebalance them on a quarterly basis, meaning all you would need to do is buy these at an equal weight in your portfolio and rebalance it quarterly and save the 27 basis points.

40:25.880 --> 40:29.446
[SPEAKER_00]: There are often times where you see ETFs that are marketed, and they sound like a good idea.

40:29.907 --> 40:31.290
[SPEAKER_00]: And this is, it could be, right?

40:32.111 --> 40:38.362
[SPEAKER_00]: But in this case, in a lot of cases, you can do it yourself.

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[SPEAKER_00]: They are charging you to pretty much do nothing.

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[SPEAKER_00]: So for the Alps equals sector weight ETF, pass.

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[SPEAKER_00]: Thanks to the call.

40:49.150 --> 40:53.377
[SPEAKER_00]: U.S. investment-grade corporate bonds are enjoying a bit of a historic moment.

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[SPEAKER_00]: Borrowing costs relative to treasuries has fallen to the tightest level in more than 25 years, as investors, they just keep buying despite this political noise.

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[SPEAKER_00]: Credit spreads for blue chip companies have narrowed to just 73 basis points over government debt.

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[SPEAKER_00]: The lowest since

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[SPEAKER_00]: data.

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[SPEAKER_00]: This resilience comes even after a volatile week sparked by the president's tariff threats over Greenland, which briefly rattled stocks before a rapid reversal.

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[SPEAKER_00]: Bond investors largely shrugged off the drama with fund managers arguing the macro and political shocks, while they've lost their power to meaningfully disrupt credit markets.

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[SPEAKER_00]: Issues that paused earlier in the week quickly returned in banks like, true as to

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[SPEAKER_00]: In reality, U.S. companies have already raised more than $172 billion dollars in investment grade debt this year.

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[SPEAKER_00]: The year is 26 days old, 27 days old.

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[SPEAKER_00]: It's the fastest start since the pandemic era borrowing surge of 2020.

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[SPEAKER_00]: Strong demand is being driven less by spreads and more by attractive all-in yields with policy rates, still high enough to appeal to insurers and pension funds.

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[SPEAKER_00]: So in that sense,

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[SPEAKER_00]: Investors are prioritizing dependable income over these valuations concerns, even as spreads sit near record tightness.

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[SPEAKER_00]: Some market participants also see a relative shift in risk perception arguing that US government debt now looks blessed pristine due to its erratic fiscal and trade policy.

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[SPEAKER_00]: that dynamic may be quietly flattering corporate spades, creating what some describe as a quote illusion of extreme safety and company balance sheets.

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[SPEAKER_00]: Longstanding profitability and cash flow consistency among Blucia borrowers is reinforcing investor conference a bit and perhaps fighting against this broader political uncertainty.

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[SPEAKER_00]: The result is, at least what we've seen so far,

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[SPEAKER_00]: with more investors on both the retail and institutional level, favoring corporate bonds over treasuries as faith in corporate fundamentals, continues to outweigh concerns about widening government deficits.

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[SPEAKER_00]: And so regardless of if it's because investors are weary of the government or less weary of corporate entities, the outcome is the same.

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[SPEAKER_00]: Corporate bonds spreads are the tightest they've been this century.

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[SPEAKER_00]: I'm Lou Guerrero and this completes another episode of Invest Talk.

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[SPEAKER_00]: Justin and I thank you for listening and encourage you to tell your friends and family members about our free podcast downloads, which you can get any time, iTunes or Spotify, and while you're at it, why don't you go check out our videos that we post over on our YouTube channel just search Invest Talk with two T's.

43:58.412 --> 43:59.453
[SPEAKER_00]: One thing I also want to mention.

44:00.867 --> 44:06.156
[SPEAKER_00]: is the opportunity for you to head over to invest.com and click the portfolio review.

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[SPEAKER_00]: But it can add a little bit of confidence and clarity to your investing life and should you decide to become a client of KPP.

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[SPEAKER_00]: You will get the benefit of what we call parallel investing.

44:17.455 --> 44:31.330
[SPEAKER_00]: Ensure what that means is through each of our strategies we invest our own money as well, and it differentiates itself from what a lot of companies offer, because it puts our skin in the game, it shows how much we believe in our strategies.

44:32.011 --> 44:37.977
[SPEAKER_00]: Follow that sounds interesting, head over to Investarch.com and click the portfolio review button, we can't wait to chat with you.

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[SPEAKER_00]: Independent Thinking shared success.

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[SPEAKER_03]: This is Invest Talk.

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[SPEAKER_03]: Good night.

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[SPEAKER_03]: It's important for the listener to understand that not all comments made will apply to them.

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[SPEAKER_03]: Specifically, nothing said she'll be taken to be investment advice.

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[SPEAKER_03]: or shell statements on this program be considered an offer to buy or sell security.

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[SPEAKER_03]: Because such advice is rendered solely on an individual basis, and at times, will require that the investor review a prospectus before investing.

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[SPEAKER_03]: Invest talk is a copyrighted program of Klein, Pavles, and Peasley Financial, a registered investment advisor firm, which retains all rights.

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