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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 to the Thursday, March 26th, 2026 edition of Invest Talk.

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[SPEAKER_00]: I'm your host, Luke Guerrero, and I'll be with you over these next 50 minutes or so to answer your burning questions and bring you the stories that matter.

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[SPEAKER_00]: To that end, in just a bit, we'll talk about today's market performance and run down those show topics.

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

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[SPEAKER_06]: My name is Alfrig.

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[SPEAKER_06]: I'd like to know your order thoughts on Berkshire Hathaway.

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[SPEAKER_06]: Thank you.

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[SPEAKER_00]: Berkshire Hathaway.

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[SPEAKER_00]: Take her BRKB, unless you want to shell out hundreds of thousands of dollars for the A shares line.

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[SPEAKER_00]: is the world's largest conglomerate by revenue.

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[SPEAKER_00]: It is a holding company.

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[SPEAKER_00]: It owns Geikode, and it's beach, our G, it owns Berkshire Hathway, primary group, which is their insurance.

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[SPEAKER_00]: They hold large positions in various companies, banks, Apple, Coca-Cola, and for several years now, it has done very, very well because of this diversification of its business.

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[SPEAKER_00]: You today, it's down about 5.45% down 10.87% over the past 52 weeks and really since the end of 2024, it was really just ranging for the most part.

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[SPEAKER_00]: Now look back in a down year in 2022 when this in P500 is down 22.8%.

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[SPEAKER_00]: It was up 3.3.

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[SPEAKER_00]: It has generally given some pretty broad out performance relative to its industry.

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[SPEAKER_00]: Now, what's been happening here?

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[SPEAKER_00]: Well, they do have a massive cash pile, 373 billion dollars.

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[SPEAKER_00]: I think they own four to five percent of the treasury market at this point.

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[SPEAKER_00]: And before Buffett retired at the end of last year, he was building this cash position.

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[SPEAKER_00]: Was it for an acquisition in the near future?

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[SPEAKER_00]: Was it to give his successor the wiggle room to operate the company, how he sees fit?

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[SPEAKER_00]: Only time will tell.

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[SPEAKER_00]: Now that retirement brings into question,

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[SPEAKER_00]: The Buffet Premium, the stock initially sold off as this premium as we've reprised able is now 2 to 3 months in and has early moves exit from craft hines, buybacks, a transparent shareholder letter aren't aimed at more than anything trying to rebuild that confidence.

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[SPEAKER_00]: because this company does trade at a pretty expensive multiple 22.8 times price to forward looking earnings.

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[SPEAKER_00]: It's average over the past five years, it's 22.3 and Buffett and Charlie Munger before he passed where in charge of this company for so long that this is a dramatic change.

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[SPEAKER_00]: Now as I mentioned, they have that huge cash position sitting on roughly 35% of its market cap in cash.

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[SPEAKER_00]: It is

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[SPEAKER_00]: Essentially, makes this the biggest bet on optionality in the market.

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[SPEAKER_00]: There are headwinds elsewhere.

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[SPEAKER_00]: You're seeing short-term earnings headwinds, and insurance with some deterioration there.

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[SPEAKER_00]: But buybacks should, in a way, give you confidence if you were looking to buy in here.

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[SPEAKER_00]: I have always said, historically speaking,

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[SPEAKER_00]: Enter a position in Berkshire, you should do so when the company is buying back shares.

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[SPEAKER_00]: And they're buying back shares right now.

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[SPEAKER_00]: Now, it is trading, like I said about it, it's average price.

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[SPEAKER_00]: I don't see a huge undervalue here relative to Berkshire, where it's been, but we do hold it in one of our strategies for clients, for the reason that it's diversification of its revenue stream of its asset base makes it especially in volatile times.

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[SPEAKER_00]: a good one to hold.

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[SPEAKER_00]: It's Berkshire Hathaway to your BRKB.

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[SPEAKER_00]: We got a lot of ground to cover in the next 45 minutes or so.

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[SPEAKER_00]: My main focus point concerns, a story that's been on top of markets for some time now.

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[SPEAKER_00]: It's about weight loss drug stocks.

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[SPEAKER_00]: And whether or not it is a huge biotech breakthrough or a market bubble.

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[SPEAKER_00]: The FDA's approval of a higher dose will gov marks.

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[SPEAKER_00]: You'll have to notice a aggressive push to reclaim market share in the exploding weight loss drug sector.

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[SPEAKER_00]: Pharmaceutical investors are understandably watching closely as competition intensifies what could become a trillion dollar market.

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[SPEAKER_00]: We'll switch on mortgage rates, which rose for the fourth straight week.

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[SPEAKER_00]: Go a little bit more in depth about something we've been talking about for quite some time now that is the fertilizer market and should we have time at the end of the show.

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[SPEAKER_00]: What thus far have been the biggest corporate winners and losers of the Iran War.

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[SPEAKER_00]: We also have some voice bank calls ready to play, including one on CDW corporation, take your CDW, another on caterpillar ink, take your CAT.

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[SPEAKER_00]: As always, we'll have some questions that came in from the comment section of the Invest Talk YouTube channel.

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[SPEAKER_00]: And of course, I welcome your findings and investment questions now, or any time throughout the show.

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[SPEAKER_00]: We're going into a quick break.

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[SPEAKER_00]: Please remember, you can call anytime, and leave your questions on the Invest Talk Voice Bank.

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[SPEAKER_00]: If you're listening to your livestream, we're on AM 1220 in the Bay Area.

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[SPEAKER_01]: When you tell your friends about Investork and they ask you why you listen, let them know there are many reasons and one is parallel investing from KPP Financial and Investorkos Justin Klein.

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[SPEAKER_01]: Parallel investing means Justin invests right alongside KPP financial clients.

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[SPEAKER_01]: He makes the same trade for KPP financial on the same day at the same price and the same percentages as KPP clients.

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[SPEAKER_01]: There's no front running and no special treatment.

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[SPEAKER_01]: In this way Justin and KPP financials share the same risks and the same potential for success.

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[SPEAKER_01]: Parallel Investing aligns the interests of Justin and KPP Financial with those of his clients.

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[SPEAKER_01]: Justin, Klein and Luke Guerrero are ready to answer your questions about Parallel Investing.

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[SPEAKER_01]: And you can learn more anytime at InvestTalk.com.

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[SPEAKER_01]: 24-7, Rainer Shine, there's always value in the Invest Talk podcast.

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[SPEAKER_01]: 888-99, chart.

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[SPEAKER_00]: U.S. stock selling off pretty sharply today, reversing some of the earlier gains to close near session lows.

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[SPEAKER_00]: Look at the indices, the Dell Dow fell 1% SNP dropped 1.74%, Nasdaq shed 2.4% and the Russell 2000 lost 1.7%.

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[SPEAKER_00]: Growth.

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[SPEAKER_00]: Momentum.

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[SPEAKER_00]: Those factors really bored the brunt.

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[SPEAKER_00]: Wow, value head up.

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[SPEAKER_00]: Helped up somewhat better.

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[SPEAKER_00]: Those still finished deeply in the red.

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[SPEAKER_00]: The formula right now is painfully simple.

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[SPEAKER_00]: Oil is up.

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[SPEAKER_00]: Yields are up.

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[SPEAKER_00]: Stocks are down.

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[SPEAKER_00]: Financial conditions continue to tighten as the market has flipped back to conflict de-escalation's skepticism amid another day of largely one-sided messaging and wide gaps in ceasefire proposals spill over effects from the conflict are getting more attention by the day.

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[SPEAKER_00]: Treasure yields are surging once again 12 to 14 basis points at the front to belly of the curve and volatility in the rates.

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[SPEAKER_00]: Complex is becoming a standalone concern in and of itself.

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[SPEAKER_00]: All three treasury options this week tailed, cap by today's $44 billion seven year sale, that are funds futures are now pricing in 17 basis points of hikes through year end up 10 basis points from just Wednesday.

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[SPEAKER_00]: That is a dramatic shift from the 53 basis points in cuts the market expected at the beginning of March.

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[SPEAKER_00]: Big Tech was a major drag, meta.

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[SPEAKER_00]: Under outside pressure following a string of adverse legal headlines, memory and semis flagged as some of the most crowded longs, saw sizable weakness as well.

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[SPEAKER_00]: You've had medals and industrials big vanks, crypto, cruise lines and casinos, the other high profile under performers, gold, fell nearly 4% while silver dropped six and a half extending what's been a pretty brutal stretch for the medals complex.

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[SPEAKER_00]: On the other side, energy continued to outperform on the crude move.

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[SPEAKER_00]: WTI was up four and a half percent on insurance, PE, financial data, and med tech and staples held up as well.

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[SPEAKER_00]: On the data front claims data continue to support the no hiring, no firing, labor market narrative, initial claims, steady at 210,000, continuing claims at their lowest levels since May 2024.

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[SPEAKER_00]: Tomorrow brings the final March, Michigan consumer sentiment and inflation expectations report, which carry a bit of extra significance, given the oil driven repricing in rate expectations.

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[SPEAKER_00]: Also, here from a couple of Fed speakers to round out the week.

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[SPEAKER_00]: Already folks, from time to time, we do receive questions via web forms from invest hoc.com.

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[SPEAKER_00]: Here's one that just came in.

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[SPEAKER_00]: It is on ticker SNAP.

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[SPEAKER_00]: It says at what price levels is snap a buy?

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[SPEAKER_00]: Well, AI investments help this company or not.

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[SPEAKER_00]: Well, funny enough, snap, which is snapchat, snap ink.

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[SPEAKER_00]: One of the most successful investment strategies over the past five, six years has been to short Snapchat petternings.

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[SPEAKER_00]: It has just worked.

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[SPEAKER_00]: It has perpetually missed.

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[SPEAKER_00]: It has been a perpetual loser of money.

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[SPEAKER_00]: I'll be there recently becoming less unprofitable if that's a way to say it.

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[SPEAKER_00]: Cause back in 2020.

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[SPEAKER_00]: EBITDA margin was negative 30.

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[SPEAKER_00]: Net margin was negative 37.

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[SPEAKER_00]: Now EBITDA margin's negative 4.9 net margin is negative 4.7.

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[SPEAKER_00]: Revenue is growing.

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[SPEAKER_00]: But still not a clip to make this company profitable.

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[SPEAKER_00]: It's down 50% year-to-date.

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[SPEAKER_00]: It is now a $7.5 billion market cap company.

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[SPEAKER_00]: It started the year at 15.

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[SPEAKER_00]: It is now 57.39% over the past 52 weeks.

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[SPEAKER_00]: It is weak.

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[SPEAKER_00]: It is a weak company.

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[SPEAKER_00]: It's balance sheet.

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[SPEAKER_00]: But is it at $4 billion in debt?

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[SPEAKER_00]: I don't know the answer to what price level is snap stock a buy because it has been such a horrendous performer in its history with the exception of 2020 and 2023.

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[SPEAKER_00]: So, is it a buy now?

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[SPEAKER_00]: Absolutely not.

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[SPEAKER_00]: That is Snapchat, snap ink, ticker SNAP.

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[SPEAKER_00]: Keep things going and drop in another listener question now.

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[SPEAKER_04]: This is my song going from Tel Aviv.

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[SPEAKER_04]: We enjoy your show here very much.

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[SPEAKER_04]: I'm calling today because I want to increase my portfolio exposure to the industrial sector.

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[SPEAKER_04]: and I'm looking to get into caterpillar ticker symbol C-A-T.

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[SPEAKER_04]: I would love to know what your thoughts are today, what would be a good entry point even for a half position, and your thoughts on holding caterpillar for a long-term hold.

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[SPEAKER_04]: Thank you very much.

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[SPEAKER_04]: I'll listen to your answer every morning here on this show.

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[SPEAKER_04]: Thank you guys.

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[SPEAKER_00]: Sick look at Caterpillar, ticker C-A-T.

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[SPEAKER_00]: It is an industrial name up 334 billion dollar market capit is the world's largest manufacturer of construction and mining equipment, off highway, diesel, and natural gas engines in industrial gas turbines and diesel electric locomotive.

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[SPEAKER_00]: So they have three primary,

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[SPEAKER_00]: segments, they're construction industries segment, which is 36% of their business, power and energy, which is about 40% of their business, and resource industries, which is about 18% of their business.

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[SPEAKER_00]: Now in fiscal year 2025, it's 100th year.

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[SPEAKER_00]: of operation, my dad.

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[SPEAKER_00]: This company had a ties revenue up 67.6 billion up 18% year over year.

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[SPEAKER_00]: They have as well a backlog record of 51 billion with a B in projects up 71%.

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[SPEAKER_00]: year over year 62 percent of which were expected to deliver within the 12-month stretch into twenty twenty seven twenty twenty six sales growth guidance at about five to seven percent of it under what it has been averaging over the past couple years but i mean a lot of that coming out of the pandemic from twenty twenty two and uh... sorry from twenty twenty twenty twenty twenty two is when they saw forty billion to sixty billion in revenue growth so fifty percent in two years

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[SPEAKER_00]: 5% to 7% for an industrial name is absolutely fine.

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[SPEAKER_00]: And what's really been driving this name is Power Generation, right?

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[SPEAKER_00]: The AI infrastructure story in this case with their heavy movers.

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[SPEAKER_00]: It is the dominant re-rating catalyst of the past 12 months, because these AI data centers need massive, reliable, backup, and primary power.

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[SPEAKER_00]: Your gas turbines, your generators.

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[SPEAKER_00]: And caterpillar has been supplying these.

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[SPEAKER_00]: That wasn't all good.

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[SPEAKER_00]: There's a bit of a headwind with tariffs, of course, to the tune of what they estimated to be $2.6 billion, but given the need to mine copper, given the need to build these AI data centers and maintain their power.

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[SPEAKER_00]: This company has been a no-brainer over the past couple years.

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[SPEAKER_00]: Up 22.7% in 2024, up 23.4% in 2023, up 57.9% in 2025.

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[SPEAKER_00]: Sprite itself to a point where it's pretty expensive at this point.

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[SPEAKER_00]: Down to 0.2% today, I'd probably wait for a pullback down to like this 650 level would be more reasonable because it's currently trading at 30 times price to forward looking earnings, nearly double its average.

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[SPEAKER_00]: Great company.

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[SPEAKER_00]: Keep it on your watch list.

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[SPEAKER_00]: Thanks for the call.

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[SPEAKER_00]: Headed into Break, still to come, my main focus point and more answers to your questions.

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[SPEAKER_00]: Here on Invest Talk.

15:38.247 --> 15:45.877
[SPEAKER_01]: In the early days, in Vestock was Jerry Klein and Steve Peasley.

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[SPEAKER_01]: 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_01]: So when you've got finance and investment questions, don't forget to call in Vestock, 888-99, chart.

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[SPEAKER_00]: So the FDA, just to prove a higher dose version of novenortisks, we're going to be the seven point two milligrams injection.

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[SPEAKER_00]: And it's a significant development and what has become one of the most important investment stories in health care.

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[SPEAKER_00]: The high dose will go.

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[SPEAKER_00]: We showed an average weight loss of 20.7%.

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[SPEAKER_00]: after 72 weeks in trials.

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[SPEAKER_00]: Compared to about 15% for the standard dose, that narrows the gap with Eli Lilly's Zepound, which had become the preferred drug amongst prescribers precisely because it delivered more pronounced results.

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[SPEAKER_00]: No, we'll expect to launch the higher dose in April.

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[SPEAKER_00]: And this was the first approval under the FDA's new priority review, voucher program that cuts review times to one to two months.

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[SPEAKER_00]: Now, I know a lot of listeners are wondering should I invest in weight loss drug companies?

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[SPEAKER_00]: I mean, it is a market that has captured enormous investor attention and for good reason, but let me walk you through the landscape with a bit of nuance because the answer depends heavily on which company you're looking at and what price you're paying.

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[SPEAKER_00]: First, let's talk about how big this market opportunity actually is.

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[SPEAKER_00]: The obesity treatment market was roughly $50 billion in 2025 and is projected to approach 100 billion by the end of the decade.

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[SPEAKER_00]: Some of these drugs at the market, the five biggest GOP-1 medications, OZEM pick with Govy, Red Valsice, plus ZETBound in Monjaro, have collectively generated over $71 billion in U.S. Revenant.

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[SPEAKER_00]: In Lily's most recent quarter alone, Monjaro and ZETBound brought in more than 11 billion in combined sales.

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[SPEAKER_00]: There are currently 20 to 25 million patients taking these drugs, and the addressable population is far larger than that.

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[SPEAKER_00]: It's not a niche market.

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[SPEAKER_00]: This is one of the biggest pharmaceutical opportunities in history.

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[SPEAKER_00]: But which companies are competing and who's winning?

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[SPEAKER_00]: I mean, this is really a two-horse race right now.

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[SPEAKER_00]: Eli Lilly and Nova are the only companies with FDA-proved GOP-1 drugs for weight loss.

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[SPEAKER_00]: And between them, they control essentially the entire branded market.

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[SPEAKER_00]: Lily has about 60% global market share versus novos roughly 39%.

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[SPEAKER_00]: The US is even more lopsided between 7 and 8 out of 10 new prescriptions are going to Eli Lilly's drugs.

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[SPEAKER_00]: Now, Lilly's advantage comes down to efficacy and head-to-head trials that found delivered 47% greater, well-it-of-weight loss than standard dose we're going.

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[SPEAKER_00]: Lily's drugs are dual action, they target both GLP ones and GIP receptors, which appears to produce superior results, and Lily's patent protection extends into the back half of the 2030s giving it a relatively long runaway.

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[SPEAKER_00]: Both companies are now racing to launch the second iteration of these drugs.

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[SPEAKER_00]: Weight loss pills, which could dramatically expand the patient population by reaching people who are needle livers.

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[SPEAKER_00]: Nova launched oral will go via January to starting price of $149 per month significantly cheaper than the $1000 list price for injectables at Bound.

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[SPEAKER_00]: But Lily's competing pill has a convenience advantage.

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[SPEAKER_00]: It doesn't require the dietary restrictions that nobles pill does.

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[SPEAKER_00]: Lily's pill is expected to launch in the second quarter of this year.

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[SPEAKER_00]: So the deeper question is, are these stocks overvalued at current levels?

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[SPEAKER_00]: Here's what you need to be careful.

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[SPEAKER_00]: Lily trades about 45 times trailing earnings.

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[SPEAKER_00]: That comes down from over 75 times a year ago, and the growth trajectory does justify a bit of a premium, right?

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[SPEAKER_00]: Sales are projected to continue to surge, but you're paying for a lot of future growth that multiple.

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[SPEAKER_00]: If anything disrupts trajectory, regulatory changes, competition, from generics, or clinical setbacks, the downside could be sharp.

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[SPEAKER_00]: No, though, is much cheaper about 14 times earnings, which reflects the market's concern about its eroding market share.

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[SPEAKER_00]: The stock has dropped about 50% from its highs.

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[SPEAKER_00]: It's a very different risk reward profile.

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[SPEAKER_00]: The higher dose will go, the oil pill helps stabilize this.

20:06.140 --> 20:09.965
[SPEAKER_00]: Well, no, no, though, could represent a genuine value opportunity.

20:10.525 --> 20:15.191
[SPEAKER_00]: For investors who want exposure, it's understandable to jump at the chance.

20:15.331 --> 20:18.615
[SPEAKER_00]: Thinking that, well, this stock may be overvalued, this stock may be undervalued.

20:19.195 --> 20:22.459
[SPEAKER_00]: But it is a bit more complex and nuanced than that.

20:23.131 --> 20:26.456
[SPEAKER_00]: The bottom line is that the weight loss drug market is real.

20:26.797 --> 20:29.341
[SPEAKER_00]: It's enormous, and it has years of growth ahead.

20:29.822 --> 20:33.468
[SPEAKER_00]: But the investment thesis depends entirely on what companies you choose.

20:33.948 --> 20:35.631
[SPEAKER_00]: What valuations you're comfortable with.

20:36.372 --> 20:48.632
[SPEAKER_00]: Your belief, whether or not it'll remain effectively to doopily, or if like many other industries given the demand here, if other companies will enter the market

20:49.793 --> 20:54.940
[SPEAKER_00]: As both face headwinds from government pricing pressure, the eventual emergence of generic competition.

20:55.420 --> 21:03.271
[SPEAKER_00]: This is a great market, but it current prices, it is a dangerous game, not a slam dunk by everything trade.

21:03.291 --> 21:15.987
[SPEAKER_00]: Well, folks, if you haven't yet, I think would be a great time to head over to our Invest Talk YouTube channel, and check out these new videos we have uploaded, which are summing up,

21:16.169 --> 21:18.553
[SPEAKER_00]: What has been happening in our market madness competition?

21:19.254 --> 21:26.646
[SPEAKER_00]: Justin and I, after each round, we'll be posting a video to go through the winners, go through the losers, and talk about what has been driving the market.

21:26.666 --> 21:27.468
[SPEAKER_00]: That sounds interesting.

21:27.528 --> 21:29.792
[SPEAKER_00]: I think they're great video, short sweet into the point.

21:30.212 --> 21:33.979
[SPEAKER_00]: Head over to our YouTube channel, search Invest Talk with two T's to check it out.

21:35.862 --> 21:38.326
[SPEAKER_00]: On the next Invest Talk, we will look into this story.

21:38.807 --> 21:42.733
[SPEAKER_00]: Our home prices and mortgage rates, creating housing crisis.

21:43.861 --> 21:52.311
[SPEAKER_00]: The traditional spring housing market is facing a bit of a perfect storm of challenges, as mortgage rates hit three mob highs amid Middle East tensions.

21:52.992 --> 22:02.002
[SPEAKER_00]: Real estate investors and home buyers are navigating unprecedented uncertainty in what's typically the industry's strongest season.

22:02.022 --> 22:12.214
[SPEAKER_00]: We'll bring in that story tomorrow, but for now I still got one half hour to go, which means more stories to bring you today and more answers to your finance and investment questions.

22:13.730 --> 22:19.251
[SPEAKER_00]: While you're at it, while you're listening, feel free to pick up that phone and dial 8899 chart.

22:32.427 --> 22:36.133
[SPEAKER_01]: are a few things that make KPP financial special.

22:36.654 --> 22:38.937
[SPEAKER_01]: One of them is parallel investing.

22:39.318 --> 22:42.643
[SPEAKER_01]: This means they invest right alongside their clients.

22:43.104 --> 22:44.085
[SPEAKER_01]: Here's how it works.

22:44.626 --> 22:52.679
[SPEAKER_01]: When KPP financial makes a trade for their clients, Justin Klein makes the same trade for himself and KPP.

22:53.220 --> 22:57.827
[SPEAKER_01]: On the same day, at the same price

22:57.807 --> 23:00.490
[SPEAKER_01]: No front running, no special treatment.

23:01.051 --> 23:20.575
[SPEAKER_02]: Learn more about Parallel Investing at Investalk.com.

23:22.698 --> 23:28.426
[SPEAKER_00]: Well, first off, congratulations on making the jump from listener to caller.

23:28.446 --> 23:29.247
[SPEAKER_00]: We love to hear that.

23:30.028 --> 23:32.812
[SPEAKER_00]: So go look at Ticker C.D.W.

23:32.973 --> 23:39.522
[SPEAKER_00]: C.D.W is a $15.64 billion market cap company.

23:39.542 --> 23:45.330
[SPEAKER_00]: They are the largest U.S. multi-brand IT solutions provider by revenue.

23:45.310 --> 23:53.764
[SPEAKER_00]: They sell hardware, they sell software, and they sell integrated solutions between those two, two, about 250,000 customers across their three segments.

23:54.566 --> 24:02.078
[SPEAKER_00]: Their corporate segment, which is about 42% of their revenue, their public segment, which is about 38% and small businesses, which makes up about 8%.

24:02.098 --> 24:10.693
[SPEAKER_00]: Now, over the past 52 weeks and really going back to the end of 2023, they've had a bit of a rough ride, but only consistent downtrend.

24:10.673 --> 24:35.263
[SPEAKER_00]: you're today third down 11.03% and one of the reasons why is growth which is really front heavy over the past five years when they grew from 18.4 billion to 23 billion in revenue from 2020 and 2022 has hit a bit of a rough patch they in fact even this year are not projected to reach back to those 2022 highs so it's causing it as well.

24:35.243 --> 24:37.846
[SPEAKER_00]: The first thing is the IT spending cycle.

24:37.906 --> 24:42.853
[SPEAKER_00]: It has been stuck in pretty low gear.

24:43.454 --> 24:45.777
[SPEAKER_00]: Their growth track center prize IT budgets.

24:45.937 --> 24:51.905
[SPEAKER_00]: So 2022 to 2024 saw post-pandemic IT normalization with devices, servers networking.

24:52.405 --> 24:56.731
[SPEAKER_00]: After this COVID pull forward, 2025 growth was slower.

24:56.771 --> 25:03.900
[SPEAKER_00]: It was decent, but by historical standards, the 6% didn't quite live up to the 8% to 10%.

25:03.998 --> 25:11.247
[SPEAKER_00]: There's also been a bit of a divergence between corporate and small businesses, small business growth in customer base.

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[SPEAKER_00]: Growing about double digits, whereas corporate, which is their largest enterprise, is really inching along.

25:18.115 --> 25:23.021
[SPEAKER_00]: And so, understandably, investors are punishing the stock when their largest division isn't growing by much.

25:24.883 --> 25:32.773
[SPEAKER_00]: And so, because of this, they are near their decade lows, the forward looking price earnings, trading at 11.3%.

25:33.901 --> 25:37.505
[SPEAKER_00]: And another reason why isn't even related to revenue, they just had cost-pressure growth.

25:38.146 --> 25:45.936
[SPEAKER_00]: Memory cost inflation with the AI demand, tariff headwinds from input costs.

25:45.956 --> 25:49.160
[SPEAKER_00]: Then you add on top of that, that their leverage is pretty decent.

25:50.141 --> 25:53.685
[SPEAKER_00]: And you find yourself in a position where the company is frankly just struggling.

25:54.726 --> 26:01.815
[SPEAKER_00]: Now, with that being said, I think that a lot of the headwinds in the longer term,

26:03.483 --> 26:08.209
[SPEAKER_00]: can be solved, and it certainly is trading very cheap.

26:10.312 --> 26:19.825
[SPEAKER_00]: But typically speaking, what we know is companies that tend to underperform and are the 20% worst underperformers in any industry, tend to continue to do so.

26:19.945 --> 26:27.976
[SPEAKER_00]: And so until I see a bit of a turn in momentum here, until I see a bit of a turn from a technical basis, I don't see any reason to start to add this to your portfolio.

26:28.476 --> 26:31.380
[SPEAKER_00]: The DCW Corporation, take your CDW.

26:32.390 --> 26:47.928
[SPEAKER_00]: Let's head over to the Investog YouTube comment section question bank to take a look at this question that came in yesterday and it says you mentioned fertilizer as a second and second beneficiary.

26:48.428 --> 27:01.283
[SPEAKER_00]: Would you say petrochemical companies and grade this

27:02.562 --> 27:11.458
[SPEAKER_00]: Well, a little bit convoluted to be able to fully project predict what second order effects will be of rising in the podcast.

27:11.498 --> 27:24.621
[SPEAKER_00]: We talk about this and we actually have a story we're going to be talking about a little later on about how a lot of people are focusing on oil, but the components that are making up fertilizer a lot that comes from the Middle Eastern passes through the straight of her moose.

27:24.601 --> 27:34.411
[SPEAKER_00]: I have heard stories, been talking to people, farmers who are already worried about the cost of fertilizer and it's not just a cost thing, right?

27:34.431 --> 27:44.741
[SPEAKER_00]: At a certain point, it becomes less about how much you have to pay and if you'll be able to pay at all, will there be supply for you to purchase?

27:45.562 --> 27:51.148
[SPEAKER_00]: And so certainly a lot of these names have run up as you expect revenues to increase dramatically because

27:52.057 --> 27:55.122
[SPEAKER_00]: of how important and critical a lot of these goods are.

27:55.582 --> 27:55.963
[SPEAKER_00]: Great.

27:57.445 --> 27:57.806
[SPEAKER_00]: Food.

27:58.907 --> 28:01.130
[SPEAKER_00]: Things that need to be produced.

28:02.693 --> 28:08.541
[SPEAKER_00]: The question though becomes, given that all this is known, are you priced at?

28:08.561 --> 28:09.563
[SPEAKER_00]: Is it priced in already?

28:09.623 --> 28:18.476
[SPEAKER_00]: And so for a lot of these companies, a lot of some of the ones you mentioned as well, given what we see in a run-up, I would hesitate to buy in just yet.

28:18.997 --> 28:19.718
[SPEAKER_00]: Thanks for watching.

28:20.457 --> 28:21.358
[SPEAKER_00]: Looks like we got time.

28:21.859 --> 28:23.741
[SPEAKER_00]: So let's roll in another listener question now.

28:24.663 --> 28:25.864
[SPEAKER_05]: I just didn't look.

28:25.884 --> 28:30.731
[SPEAKER_05]: I'm calling in with a question on the stock Lumen technologies.

28:31.071 --> 28:37.720
[SPEAKER_05]: The symbol is L, U, M, N. I've been a long time holder.

28:38.041 --> 28:50.397
[SPEAKER_05]: And if wondering what your thoughts are on the whether or not to continue to hold the stock, one is in a retirement account.

28:50.680 --> 28:56.206
[SPEAKER_05]: just wanted to see what your opinion is and I'll be listening to your podcast.

28:56.467 --> 28:57.231
[SPEAKER_05]: Thanks so much.

28:58.072 --> 29:05.525
[SPEAKER_00]: Blumen that Technologies is one of the largest U.S. enterprise network infrastructures, infrastructure providers that is.

29:06.086 --> 29:14.941
[SPEAKER_00]: They own a roughly 16.6 million in your city fiber mile network, targeting 47 million miles by 2028.

29:14.981 --> 29:21.312
[SPEAKER_00]: Their core products are really within fiber dedicated internet and Ethernet solutions.

29:23.030 --> 29:30.988
[SPEAKER_00]: Now the company has a bit of a rough time going back to 2020, but they're trading at $14 is a huge drop off into 2024.

29:31.008 --> 29:35.077
[SPEAKER_00]: A massive jump from about $1 share to $6 a share.

29:35.137 --> 29:39.587
[SPEAKER_00]: Now they're trading at about $6.76 per share.

29:40.225 --> 29:50.737
[SPEAKER_00]: One of the things that has been driving this stock is the idea that private connectivity fabric is a bet on becoming the private network layer for an infrastructure.

29:50.757 --> 30:01.871
[SPEAKER_00]: So hybrid scalars and large enterprises, building an workloads, they need these dedicated low latency secure fiber connections between these data centers and the cloud regions and the enterprise campuses.

30:01.911 --> 30:09.760
[SPEAKER_00]: So PCF offers software defined on demand connectivity that bypasses the public internet.

30:09.740 --> 30:17.567
[SPEAKER_00]: They have raised about 13 billion in cumulative PCF contracts as of 2025, the end of fiscal year 2025.

30:19.609 --> 30:33.702
[SPEAKER_00]: There also was an AT&T deal and a bit of a balance sheet rescue selling consumer fiber business to AT&T for 5.75 billion effectively helped them out of a horrible debt situation that they kind of are still in, right?

30:33.722 --> 30:39.628
[SPEAKER_00]: It's a seven billion dollar market gap company.

30:40.621 --> 30:42.243
[SPEAKER_00]: They still are not making money.

30:42.263 --> 30:48.231
[SPEAKER_00]: I think the danger here is the amount of leverage they have on their balance sheet and their big bed in one space.

30:49.172 --> 30:59.766
[SPEAKER_00]: And so I think if you wanna hold this at a really low weight, given the contracts that they already have and their mission to cost cut in their partnership with Palantir, I think that's reasonable.

31:00.687 --> 31:02.089
[SPEAKER_00]: But at this point,

31:02.272 --> 31:12.692
[SPEAKER_00]: Given the leverage, given the balance sheet, given the volatility you have here on a low volume stock, there's just a lot of downside risk relative to potential upside rewards.

31:12.752 --> 31:19.044
[SPEAKER_00]: So frankly, if it were me, I probably would not be holding lumen technologies in my portfolio.

31:19.865 --> 31:20.787
[SPEAKER_00]: Thanks for the call.

31:20.935 --> 31:30.109
[SPEAKER_00]: So mortgage rates rose for the fourth straight week to 6.38% up from below 6% in late February.

31:30.550 --> 31:37.381
[SPEAKER_00]: That is the highest level in September and the speed of the increase is what really is rattling the housing market.

31:37.401 --> 31:39.604
[SPEAKER_00]: A half-point jump in a couple weeks.

31:40.325 --> 31:43.230
[SPEAKER_00]: That is highly unusual.

31:43.784 --> 31:49.650
[SPEAKER_00]: And understandably it's spooking buyers, right as the spring selling season is supposed to be kicking off.

31:50.390 --> 31:52.252
[SPEAKER_00]: The cause is pretty straightforward.

31:52.532 --> 32:02.922
[SPEAKER_00]: It is the Iran War and the oil price spike having pushed inflation expectations higher, which raises treasury yields, which drag mortgage rates up with them.

32:02.942 --> 32:06.726
[SPEAKER_00]: The market now expects the Fed to keep rates higher for longer.

32:07.447 --> 32:13.032
[SPEAKER_00]: And that flows directly into the cost of the 30 year fixed mortgage.

32:13.366 --> 32:14.507
[SPEAKER_00]: The timing could not be worse.

32:15.168 --> 32:22.536
[SPEAKER_00]: The housing market has been for rose in for three years due to high prices and due to elevated rates.

32:23.978 --> 32:37.753
[SPEAKER_00]: There was genuine optimism heading into this year because rates of decline price growth had slowed inventory was improving and affordability had reached its best level since August 2022 according to Zillow.

32:38.830 --> 32:42.475
[SPEAKER_00]: Existing home sales actually rose in February as rates were dropping.

32:42.555 --> 32:45.499
[SPEAKER_00]: People were starting to get off the sidelines.

32:47.001 --> 32:48.082
[SPEAKER_00]: And now they're going right back there.

32:48.923 --> 32:51.567
[SPEAKER_00]: Purchase applications fell 5% last week.

32:52.348 --> 32:58.836
[SPEAKER_00]: KB homes as CEO said the last couple of weeks have been softer than what they'd normally see at this time of year.

33:00.358 --> 33:07.808
[SPEAKER_00]: One real estate agent in Virginia compared to 2025 when the spring market was derailed by tariff uncertainty, there's a lot of wait and see.

33:09.104 --> 33:16.992
[SPEAKER_00]: A Redfin survey found 25% of Americans plan to delay or cancel big purchases, like a home or a car because of the war.

33:17.953 --> 33:25.401
[SPEAKER_00]: But Rose responded, said it, didn't affect their plans, which tells you this is still a confident issue more than any affordability cliff.

33:26.182 --> 33:31.928
[SPEAKER_00]: Life events, new jobs, new babies, relocations, they're still pushing people into the market regardless of rates.

33:33.389 --> 33:38.655
[SPEAKER_00]: The key variable, as with anything right now, duration.

33:39.158 --> 33:53.794
[SPEAKER_00]: It rates come down in a few weeks because the conflict de-escalates, the laid buyers re-enter the market over the summer, but it rates hold 6.4 percent if they go higher through the fall, buyers may just give up until next year.

33:54.515 --> 34:02.664
[SPEAKER_00]: It won't take the market, but there's a meaningful difference between this lasting a month and this lasting six months.

34:02.684 --> 34:06.128
[SPEAKER_00]: It's like we got plenty of time, so let's fit in another listener question now.

34:06.580 --> 34:09.063
[SPEAKER_07]: This is Paolo from Germany calling.

34:09.564 --> 34:16.674
[SPEAKER_07]: I'm looking at the stock Mueller industry that I've been onto them since many, many months.

34:17.114 --> 34:22.201
[SPEAKER_07]: And when is there, like a good time to buy the stock?

34:22.282 --> 34:26.027
[SPEAKER_07]: Like, or what would be a good income point right now?

34:26.587 --> 34:28.190
[SPEAKER_07]: Okay, thank you, bye-bye.

34:29.992 --> 34:34.258
[SPEAKER_00]: Take a look at Mueller Industries, ticker MLI.

34:34.998 --> 34:41.785
[SPEAKER_00]: Newling industries is a manufacture and distributor of copper, brass, aluminum, and plastic products.

34:41.805 --> 34:45.529
[SPEAKER_00]: They have three segments, piping systems, industrial metals, and climate.

34:46.330 --> 34:53.879
[SPEAKER_00]: Their largest segment piping systems is about 64% of the revenue, industrial metals, about 24% of the revenue, and climate is about 12.

34:53.899 --> 34:58.183
[SPEAKER_00]: Now, with the past 52 weeks, they're 38.8%.

34:58.263 --> 35:01.647
[SPEAKER_00]: I'll be at the area down 4.62% this year.

35:02.200 --> 35:06.164
[SPEAKER_00]: And the reason why this company has been trading higher is copper price leverage.

35:06.224 --> 35:07.906
[SPEAKER_00]: It is the core earnings driver.

35:08.066 --> 35:12.952
[SPEAKER_00]: They manufacture copper intensive products, and they are an margin on fabrication and value add.

35:13.032 --> 35:20.780
[SPEAKER_00]: When copper prices rise, Mueller typically benefits from price cost spreads widening as long as the moves are gradual.

35:21.221 --> 35:25.305
[SPEAKER_00]: Comics copper surge 22% year over year in Q4 2025.

35:27.040 --> 35:28.562
[SPEAKER_00]: That is the largest explainer.

35:28.963 --> 35:30.165
[SPEAKER_00]: Another one, data center cooling.

35:30.465 --> 35:32.148
[SPEAKER_00]: It's a bit of a new growth angle for them.

35:32.168 --> 35:37.276
[SPEAKER_00]: They're climate segment manufacturers, coaxial heat exchangers, as well as refrigeration coils.

35:37.636 --> 35:42.925
[SPEAKER_00]: They're used in data center cooling systems and because of the huge buildout, because of how important that is.

35:44.747 --> 35:47.492
[SPEAKER_00]: Understandably, that is a huge segment for revenue growth there.

35:47.832 --> 35:48.934
[SPEAKER_00]: That's one of the reasons why.

35:48.974 --> 35:54.162
[SPEAKER_00]: The revenue growth is 11.7% over the past five months on an annual basis.

35:55.238 --> 35:59.524
[SPEAKER_00]: Now at the same time, their margins are solid 15.8% is what it's projected to be this year.

35:59.584 --> 36:03.229
[SPEAKER_00]: Their return on equity was 25.86% last year.

36:03.910 --> 36:10.899
[SPEAKER_00]: Now they are trading at 15.5 times price to forward looking earnings, but that's lower than we've seen in the recent past.

36:10.959 --> 36:13.563
[SPEAKER_00]: They were trading as high as 18 times at one point.

36:14.885 --> 36:18.850
[SPEAKER_00]: They are not immune to the market drawdown that we've seen.

36:19.657 --> 36:21.759
[SPEAKER_00]: But they are in a very strong position.

36:21.819 --> 36:26.305
[SPEAKER_00]: They have $19 million in debt on a $12.4 billion market cap company.

36:26.905 --> 36:29.969
[SPEAKER_00]: And from a relative strength perspective, they've been stellar since 2021.

36:30.349 --> 36:45.347
[SPEAKER_00]: I think, generally, that some of the drivers of market drivers of capital have certainly allowed this company to be a big beneficiary, such that I think it's a good company to include in your portfolio.

36:45.367 --> 36:48.330
[SPEAKER_00]: There's Mueller Industries, Ticker M, L, I.

36:49.559 --> 37:02.617
[SPEAKER_00]: Well folks, we do have an upcoming in Vestock Wealth webinar that we are planning for April, but you know what we have not yet fully decided what the topic will be.

37:02.717 --> 37:12.450
[SPEAKER_00]: Typically, just in an eye, get into a room and we decide what has been really important for investors to know where we think we can add value to your lives.

37:13.391 --> 37:18.638
[SPEAKER_00]: But I think the best person to tell us how we can add value is

37:19.276 --> 37:20.198
[SPEAKER_00]: So here's what I want you to do.

37:21.020 --> 37:23.665
[SPEAKER_00]: I want you to head over to our Invest talking YouTube channel.

37:24.226 --> 37:27.012
[SPEAKER_00]: I want you to go to the comment section of any of our recent videos.

37:27.753 --> 37:32.283
[SPEAKER_00]: And in the comment section, I want you to put the topic that will interest you.

37:32.563 --> 37:34.728
[SPEAKER_00]: What do you want to learn more about?

37:34.768 --> 37:38.636
[SPEAKER_00]: What should we devote 30 minutes to for presentation?

37:38.896 --> 37:40.660
[SPEAKER_00]: Another 30 minutes for questions.

37:41.348 --> 37:43.551
[SPEAKER_00]: In the coming weeks, we'll go to those comments.

37:43.571 --> 37:50.140
[SPEAKER_00]: We'll see what you think we should be discussing and we will bring you a new Invest Talk Wellf Webinar in the month of April.

37:50.921 --> 37:51.782
[SPEAKER_00]: This is Invest Talk.

37:52.363 --> 37:54.786
[SPEAKER_00]: I'm Luke Guerrero and we have one goal here.

37:55.387 --> 37:58.611
[SPEAKER_00]: And that goal is the same goal we have each and every day.

37:59.953 --> 38:06.141
[SPEAKER_00]: To educate you a little bit, in order to make you a better investor to help you achieve your financial freedom.

38:07.471 --> 38:11.869
[SPEAKER_00]: When we got one more segment left in this show, but our work continues after this break.

38:11.890 --> 38:17.734
[SPEAKER_00]: So if your question has not been answered yet, pick up that phone and dial 8899 chart.

38:21.443 --> 38:26.769
[SPEAKER_04]: I would like to know a more about a company which I've been tracking for some time.

38:26.789 --> 38:30.193
[SPEAKER_03]: Luke Guerrero is here and ready to tackle your questions.

38:30.494 --> 38:36.220
[SPEAKER_04]: And I was just wondering, are there any investment accounts with different things that you would recommend?

38:36.621 --> 38:38.783
[SPEAKER_04]: Something that may offer a good resources.

38:38.903 --> 38:43.789
[SPEAKER_03]: Don't forget to call, in best talk, 888-99 chart.

38:50.789 --> 39:06.605
[SPEAKER_01]: In Best Law, 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 at any time on 88899 chart.

39:11.249 --> 39:20.779
[SPEAKER_00]: So we've talked about the fertilizer crunch before, but the situation has really gotten significantly

39:21.012 --> 39:34.508
[SPEAKER_00]: In the last week, fertilizer prices are now at more than 40% since the conflict started, and this is hitting right during the spring planting window and farmers use the bulk of their annual fertilizer supply.

39:35.108 --> 39:39.553
[SPEAKER_00]: The head of the Tennessee Farm Bureau called it almost unbearable.

39:40.555 --> 39:42.537
[SPEAKER_00]: And he raised a genuinely alarming point.

39:43.218 --> 39:47.863
[SPEAKER_00]: The conflict continues, farmers may not be able to get enough fertilizer to finish the growing season.

39:47.995 --> 39:56.988
[SPEAKER_00]: About a quarter of U.S. growers haven't even secured their fertilizer supply yet, according to agricultural secretary, for Gralans who called it a national security issue.

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[SPEAKER_00]: And the math is brutal.

40:00.534 --> 40:06.763
[SPEAKER_00]: Before the war, planting an acre of corn was forecast to cost about $917 this year.

40:07.148 --> 40:09.271
[SPEAKER_00]: with fertilizer counting for about a third of that.

40:09.912 --> 40:14.599
[SPEAKER_00]: Nitrogen fertilizer retail prices have since risen by as much as a third on top.

40:15.300 --> 40:19.427
[SPEAKER_00]: And diesel, which powers farm machinery and crop transport, is up sharply too.

40:20.468 --> 40:22.752
[SPEAKER_00]: This is hitting a sector that is already in crisis.

40:23.393 --> 40:26.457
[SPEAKER_00]: Farm bankruptcy, rose nearly 50% last year.

40:27.199 --> 40:36.092
[SPEAKER_00]: Farmers are heading into a fourth consecutive year of losses and Trump's tariffs have

40:36.899 --> 40:39.924
[SPEAKER_00]: Now, farmers are responding pretty much the way you'd expect.

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[SPEAKER_00]: More acres will shift to soybeans, which need less fertilizer than corn.

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[SPEAKER_00]: Some farmers are simply cutting back on the amount they apply, and accepting lower yields.

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[SPEAKER_00]: When I will grow, I'll drop his expected yield from 200 bushels per acre to 160.

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[SPEAKER_00]: Men has down-creme consequences for corn supply, ethanol production, and food prices.

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[SPEAKER_00]: American Farm Bureau has urged Trump to use the navy to secure fertilizer shipments through the state of her moods.

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[SPEAKER_00]: NEPA announced a temporary waiver, allowing nationwide sales V-15 a higher ethanol gasoline blend, starting May 1st, which would boost corn demand and provide some price support for growers.

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[SPEAKER_00]: Trump is meeting the Farm Groups Friday, including the CEOs of John Deere tractor supply and CNH industrial.

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[SPEAKER_00]: It's a politically sensitive territory.

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[SPEAKER_00]: 78% of agricultural dependent counties backed the president in 2024.

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[SPEAKER_00]: If farmers can't afford to plant, the political fallout may compound the economic damage.

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[SPEAKER_00]: One thing I wanted to talk about before we headed off for the day is I wanted to mention our new YouTube video series.

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[SPEAKER_00]: YouTube series is called our deeper focus videos because as you know as a valued listener of this program you know that each and every day we bring you a main focus point.

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[SPEAKER_00]: But on this show given the format given that we want to get to your finance and investment questions we can really only devote five to seven minutes talking about each topic.

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[SPEAKER_00]: Now we all know that each of these topics are incredibly complex.

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[SPEAKER_00]: There is so much

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[SPEAKER_00]: And so in order to do, I think what we do best and helping to explain important topics to you.

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[SPEAKER_00]: Justin and I decided the best format for that would be over on our YouTube channel and our deeper focus series.

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[SPEAKER_00]: So if you had over to Invest Talks, a YouTube channel that's in Invest Talk with 2T, you'll find these videos which run between 20 and 25 minutes.

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[SPEAKER_00]: We hone in each week on the topic that we think is the most important.

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[SPEAKER_00]: And in these videos, you'll see a discussion between me and Justin.

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[SPEAKER_00]: You'll see my mustache and my ever-growing hair, and you'll also see visuals that will help you better understand what can be a very important and complex thing.

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[SPEAKER_00]: We'll bring you these videos each and every week on either Tuesdays or Wednesdays, and they will be dedicated to the Monday focus point.

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[SPEAKER_00]: So that sounds interesting, head over to our YouTube channel, and check out our deeper focus video series.

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[SPEAKER_00]: Well, folks, that about does it for another episode of Invest Talk, as always, Justin and I thank you for listening and encourage you to tell your friends and family members about our free podcast downloads.

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[SPEAKER_00]: You can get those at iTunes and Spotify and while you're at it, please be sure to leave us a rate and review to help us grow this series.

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[SPEAKER_00]: One other thing I want to mention, our practice of parallel investing.

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[SPEAKER_00]: It can't be be financial, when we make a trade for our clients, we make the same trade for ourselves, on the same day at the same price, same percentage, no front running, no special treatment.

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[SPEAKER_00]: We invest right alongside our clients.

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[SPEAKER_00]: We share the same risks, the same potential for success.

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[SPEAKER_00]: That sounds interesting.

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[SPEAKER_00]: Head over to investalk.com and schedule a free portfolio review to learn more.

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[SPEAKER_00]: Don't forget, our Invest Talk Market Magnus is still writing the thick of things, so head over to our Invest Talk YouTube channel to check out our round wrap-ups.

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[SPEAKER_00]: Independent thinking, shared success.

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[SPEAKER_00]: This is Invest Talk, good night.

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[SPEAKER_03]: Invest talk is a trademark of KPP financial because of the nature of the interactive dialogue inherent in the format of this program.

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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 says she'll be taken to be investment advice.

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[SPEAKER_03]: or shell statements on this program be considered and offered 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 perspective before investing.

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

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[SPEAKER_03]: For more information regarding KPP's investment advisors, call 1-800-557-5461.

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[SPEAKER_03]: Thank you for listening, and your comments and questions are welcome on our 24-hour listener line at 888-99 chart.