Crypto under pressure, Good Buy or Goodbye: Market Domination

On today's episode of Market Domination, Hosts Julie Hyman and Josh Lipton discuss major market trends from Nvidia's (NVDA) slowdown to Novo Nordisk's (NVO) plans to expand manufacturing capabilities of its GLP-1 weight-loss drugs.

As Nvidia continues on its downward trajectory after leading the S&P 500's (^GSPC) growth, B. Riley Wealth Chief Market Strategist Art Hogan believes the market can keep up its momentum without the chip giant:

"I think it's a perfect example of a lot of folks being concerned that Nvidia and arguably Nvidia, Microsoft (MSFT), and Apple (AAPL) were such a big part of the 15% that the S&P 500 is higher this year on a year to date basis... But you're seeing basically three or four days where Nvidia has not been leading the charge, and the market's done very well. I think that continues throughout the second half of this year."

The European Union has charged Apple under its Digital Markets Act, alleging that the tech giant's App Store practices prevent app developers from directing consumers to cheaper services. TECHnalysis Research President and Chief Analyst Bob O'Donnell believes the investigation is unlikely to conclude anytime soon, and that Apple will have to make some changes:

"I do think Apple is going to have to make some tweaks, some things that they don't necessarily want to do, but at the end of the day, again, it's an important enough market that they're going to have to follow some of these requirements that the EU is putting into place. And therefore, long term, I don't think the impact is that big of a deal as far as the value of the company and the way people view the stock."

Cryptocurrencies are also under pressure, with bitcoin (BTC-USD) having its worst trading day since March.

Meanwhile, the health industry is making major moves, as Altimmune (ALT) reported positive results in Phase 2 trials for its weight-loss drug, a Teladoc Health (TDOC) study showed its AI models contributed to positive growth in diabetes management, and Novo Nordisk revealed plans to invest $4.1 billion in building out a manufacturing facility in Clayton, North Carolina for its GLP-1 weight-loss drugs.

This post was written by Melanie Riehl

Video Transcript

Hello and welcome to market domination.

I'm Julie Hyman.

That's Josh Lipton live from our New York City headquarters.

We are giving you the ultimate investing playbook to help tune out the noise and make the right moves for your money.

Here's your headline blitz getting up to speed one hour before the closing bell rings on wall.

We have some profit taking some worry about uh peak sales.

I think we'll have a reversal and the stock will rebound based on the remarks from Ceo Jensen Wang on Wednesday morning, Pacific time, former president Trump has obviously positioned himself as the candidate that is pro Bitcoin.

He believes that all Bitcoin should be mined in the US and has been very open to his relationship with Bitcoin miners and people in the space.

The Biden administration has been very hostile to Bitcoin, you know, through its various agencies, whether it's the banking and the so called operation chokepoint 2.0 whether it's the sec et cetera back in 2016, she described what she called the high pressure labor market.

And maybe if you ran policies such that you have a high pressure labor market and some companies would be incentivized to invest and we could actually see a boost to productivity.

So I would ask her secretary Yellen, do you think you're seeing the dividends you expected to see from running a high pressure labor market, a more productive, efficient resilient economy?

Is that part and parcel of the policies that were chosen during the pandemic?

And indeed, we'll be asking her that and more Treasury Secretary Janet Yellen in a national exclusive here on Yahoo Finance, the Treasury Secretary of the United States.

She'll be discussing a new slate of initiatives to support housing development and much more in conversation with our Jennifer Schonberger.

Well, in the meantime, we've got one hour to go until the market close.

So let's take a look at the major averages here.

We've got the dow today up almost 300 points about three quarters of 1%.

The S and P 500 little change though.

And the outlier today, Josh is the NASA composite and there is one stock in particular that is the culprit behind that and that we're really zeroing in on and that stock is Invidia.

The stock is down about 5.1% today.

But we've now seen this sort of 3 to 4 day sell off here, call it three days that we have seen this decline of 11% which is the biggest sell off that we've seen in the stock.

What in at least six months or so.

And I also just wanted to point out what we're seeing in the market cap race here.

Microsoft's back on top 3.3 trillion apple, 3.2 trillion NVIDIA below three trillion now.

Yeah, I mean, if you pulled up a chart of NVIDIA and you look at, of course, you know, at that year to date, you know, Julie, it is, of course, it's just been a historic run, it's a monster.

So I get, you know, investors are, I think trying to figure out um do you see here what you would expect?

I mean, look at that chart, you, you what you expect to see was just sort of like kind of a healthy consolidation.

Is that all we're seeing here after one like that?

Do you think is the start of something a bit more serious?

Yeah, that's really the question people are asking and they're trying to look out further for NVIDIA.

Of course, with anything, the further out you get, the more difficult it is to predict.

But there's some chatter that with NVIDIA, it is uniquely difficult to predict because it's really a new market, this whole market of A I for data centers here.

And so something that I have been looking at a little bit too is the valuation here.

This is something that Bloomberg flagged today.

The price to sales ratio for the S and P uh for the NVIDIA, is that the highest in the S and P 500 which I found quite surprising the price to earnings ratio at 45 is no, is nowhere near the highest.

Um and it has been creeping up, but some analysts say it's still reasonable but price to sales because the sales is really the unknown.

Are they gonna be able to keep up this pace of sales growth that they have been seeing?

Yeah.

And then you have a kind of broader questions too Julie about, do you think the market can keep chugging higher even as a king like NVIDIA takes a breather?

Right?

Can you sort of like can you hand off the baton from NVIDIA to other names smoothly?

I mean, so far you, you saw, you pointed out that chart of what it's done recently and it has been a slide, but it's not as though so far the market seems to be, you know, falling apart here.

Yeah.

No, it doesn't, right.

Even with that stock pulling back a little bit, the NASDAQ has taken a hit as a result of that one more thing I would mention.

We just heard Paul Meeks a moment ago talk about a possible catalyst for NVIDIA shares from its shareholder meeting that is tomorrow.

Now, shareholder meetings, the Tesla of recent one aside are not typically news mo making events, right?

And NVIDIA is not expected to necessarily make any announcements.

But if Johnson Wang gives one of his sort of typically rousing speeches, could that be an excuse, a catalyst of some kind of turn the stock around maybe.

Yeah, I mean, all attention will be on that.

You're right.

Usually it's not a lot of news but you have a rock star like Jensen Wong speaking.

Who knows?

All right, let's run out this discussion from one of the latest market moves in the path ahead for.

Let's welcome in Art Hogan.

He is the chief market strategist at B Riley Wealth Art.

It is always good to see you.

Uh Let's start a kind of broader question.

Art.

You know, Julie was pointing out today, you look at the SSPXSP 500 we're basically flat today.

Art, but what a run, it's up about 15% so far this year.

Art I'm just interested.

Do you think that kind of, does that rally continue in the second half?

Art or, or no, you'd, you'd expected us to take kind of a breather here?

I think today is a perfect example and I think you guys set this up really well, I think it's a perfect example of a lot of folks being concerned that NVIDIA and arguably NVIDIA Microsoft and Apple were such a big part of the 15% that the S and P 500 hire this year on a year to date basis.

And what would happen if one of those really fell out of bed now?

Not that 10% down on a stock that's up 140% year to date, uh, minus that 10, um is, is a big fall.

But you're seeing, you know, basically three or four days where NVIDIA has not been leading the charge and the market has done very well.

I think that continues throughout the second half of this year.

I think what we're going to see is as you, if you look at the cadence of earnings growth, the, the percentage that the other 497 stocks in the S and P 500 are going to be adding becomes much larger.

So I think you're going to see the market broaden out and likely see things like energy, which we're seeing today, financials, which we're seeing today, utilities to a certain extent and likely industrials pick, you know, to your point, just pick up the baton a bit and start pulling their weight in terms of what happens in the back half of this year.

And I think that puts us in a healthier.

I think the concentration at the top obviously has people nervous.

And if in fact, we work our way through the second quarter, energy porting season and see other sectors shine, which we did in the first quarter.

You know, we saw the sectors rather than technology actually do very well.

I think this market can, can really pick itself up in the back half and not necessarily need to be driven by tech and communication services.

Uh Art does that then imply also that you're pretty optimistic about growth, right?

Because obviously the tech increases that we've seen have been boosted by this A I narrative.

But for everything else to do, well, like it just kind of has to be a general growth narrative now.

Yeah, I I would agree with that Juliet and I think when you look at the estimates for the second quarter GDP growth according to the Atlanta Fed GDP, Now it's, it's north of 3%.

We'll get another revision of the first quarter later this week.

I suspect that goes higher, not lower.

I think we're going to be on pace to not necessarily have that sort of 3.5% GDP growth that we had in the back half of last year, but something like 2.5% which is certainly above mean and likely enough to be driving profits.

So if you look at that again, if you look at the earnings estimates for the next three quarters, including the second quarter, they gradually work their way higher.

And as we all know that, you know, that we, the consensus tends to be a bit low.

So I think we continue to see both the economy and earnings grow out uh uh outside of consensus estimates uh into the end of the calendar year.

Another catalyst of potential CS are we're watching this week.

Uh P CE is on deck feds preferred inflation gauge.

What are you expecting to hear there are and what are you, what are you expecting from the fed for, for the remainder of the year?

Now, I'll tell you this, the P CE is a little easier to calculate because by the time we get both the CP I and the PP I, we know what pieces of that goes into that P CE reading.

So, um, as opposed to the 2.7 at the core level, we like to see that go down to 2.6.

And oddly enough, that's where the fed had actually factored us exiting 24.

So we'll be seeing a 2.6 print on the core likely this week that, that 2.6 is going to be close enough for government work for the, for the fed to actually feel comfortable enough in September for their first rate cut.

And I think that is likely going to be the start of feeling a bit better about where we are in the, in the monetary rate cycle.

We're, we're gonna be kind of last of the party as it as, as that goes.

Because the, as we know the ECB already made that move the bank of Canada, the bank of England leaned into it and likely goes at their next beating.

So by the time September rolls around, we will likely see the fed cut for the first time and that probably takes a little pressure off the dollar to the dollar.

Men unit are actually higher since the fed seems to be dragging their heels to the rate cut party.

Or I wanna just push on one angle that, you know, the fed.

It, it seemed like for there was a moment in time there where it was just fed all day, every day, fed, fed, fed and it feels like it, maybe it's pulled back a little, a little bit on that.

I mean, am I imagine things are, or, or is the market?

Maybe our investors coming around the idea that maybe, maybe that we're not as dependent as the fed as we thought we were six months ago or 12 months ago.

Oh, absolutely.

Such a good point.

Yeah.

So the fed pivoted, they leaned into being done with rate hikes at the end of last year and gradually.

And so we entered this year thinking maybe we get five or six rate cuts and they'd start as early as March and that dissipated pretty rapidly through the first quarter and yet the market continued to rally.

So investors have really shown that given the choice between early and often and rate cuts and better economic data and earnings, they choose the latter.

And I think that's a very intuitive choice to be making.

So I think market participants have certainly leaned into the direction of we'd rather the fed not have to cut.

But if they do cut, they can take their time doing.

And if September is the first time they do it, that's going to be great as opposed to where we were when we started this calendar year, which was assuming they were going to be cutting a whole lot more.

And the good news is they didn't have to because the economy continues to chug along at above mean pace.

Well, of course, we always have moms Harry policy on our minds, but uh lately we also have fiscal policy on our minds, right?

As we talked about, we're gonna be hearing from Janet Yellen a little bit later in the show, we've got the debate coming up later this week.

Um Do you have clients asking you about the situation in Washington?

Are you seeing more of a drumbeat for that?

And what are you watching in terms of how it might affect the markets?

Now, I will tell you when it comes down to fiscal policy, the hardest time to talk about that is an election year because neither side of the aisle is going to actually ever say anything about cutting spending.

And we need to do both.

Obviously, we're in a place where our debt is too high and uh and it's a function of two things.

We need to collect more revenues and we certainly need to spend less.

And, you know, so fortunately or unfortunately, we're not going to resolve any of that.

But after September 30th, we're going to have to start coming to, you know, some sort of agreement on what next year's budget looks like for the fiscal year.

And clearly there's going to be no new spending and there's likely going to be a push to rein in some spending.

But you know, there's two sides to this sword, right?

And the other side obviously is we need to find some revenue generation, whether it's better economic activity or, you know, simplifying a tax code, etc.

So, you know, I've been listening to people that are willing to talk about both sides of that equation.

Unfortunately, in a national election, nobody wants to talk about cutting spending.

Well, and we're probably not gonna hear it on Thursday night from the two presidential candidates most likely because that's not gonna get them any votes.

Um, but you know, what would you in that debate, what would you like to hear come up or what are you gonna be listening for in terms of any kind of direction on economic policy or tariffs or what do you think could be most important?

Yeah, I would like to have a clear and concise argument made for why tariffs actually work because I don't believe that they do.

I think at the end of the day it's the, it's the end user or the consumer that pays that tariff.

So I just think it's bad policy.

I do certainly understand how that worked 100 years ago, but in the global economy that we live in, you know that those costs are passed along to the end user or the consumer and that, that's inflationary, it's higher costs.

There's not a real benefit to it.

So I think that's one piece of the puzzle.

I think, you know, it would be a great brick in the platform for both of these candidates to remove and say that's probably not the right way to go about this.

You could certainly protect American industry without, you know, costing consumers more money.

And that's, that's one thing I'd like to see, get rid of.

I certainly would like to hear, you know, a real serious conversation about what is the best way to both find ways to cut spending, right?

And what are the best ways to generate more revenue and, and what ways would make that sense?

And I think that from the democratic side, they really talked about, you know, putting more people to work at the IRS because there's a lot of people at the upper end of the economic scale that tend to pay less in taxes and perhaps get away with it.

But the, I think simplifying this tax code be, it would go a long way towards saying, ok, we probably raise more revenues and make things more fair.

If we simplify the tax code again, election year politics, you're likely not going to hear either one of those things come up on Thursday.

You never know art hope springs eternal here when it comes to the American election system and political system.

Thanks a lot.

It's great to see you.

Good to see you.

We're just getting started here on market domination.

Coming up.

Apple stock higher today.

It looks at a potential A I deal with meta even as it is under fire in the eu we're joined by an analyst later in the hour to talk about the latest from the iphone maker plus the 345.

It's the latest edition of our series.

Goodbye or good.

I will take a deeper dive into two stocks to help to make the best moves for your portfolio and stay tuned for our exclusive interview with Treasury Secretary Janet Yellen.

That's at 4:40 p.m. Eastern today.

She'll be discussing a new slate of initiative to support housing development.

Stay tuned more mark domination on the other side as Apple has set its sights on A I growth.

The European Union has its sights set on the tech giant itself, charging the company for failing to comply with a digital competition law.

Good to take a bite into what's ahead for Apple for this and more.

Let's get to Bob o'donnell Technos Research president and chief analyst.

Good to see you, Bob.

Thanks for being here.

So let's get to that EU law first, right?

Because this is the first case that we have seen been brought as part of this Digital Markets Act.

It has to do specifically with what the eu is charging is unfair restrictions on developers in the App store.

How and it could result in a fine for Apple.

How seriously should folks be taking this?

Well, I mean, look, Julie, it's going to take a while before any of this hits.

I mean, the they announced that we're looking at it, they opened the investigation in March, they give themselves a year which means there's no official word on part of this until March of 2025.

So nothing right away.

But look, I mean, Apple made some changes at the beginning of the year in reaction to, you know, the changes that we knew were coming here in the eu.

Uh but there were a lot of people saying, look, you may have followed the letter of the law but not the spirit of the law.

And I think that's what's kind of coming back to them is people saying, look, you know, you're not really making it easy for the smaller developers to really be able to get access to this huge bounty of, of iphone um users, you know, and, and Europe is about a quarter, last quarter, it was about 25 percent of Apple's earnings.

So this is a big market for Apple.

And you know, Europe is setting the standards as far as how companies have to think about providing access to alternatives like, you know, different app stores and things like that.

Apple's always wanted to keep a closed garden, they've done it very successfully up till now.

But the eu is basically saying, no, you got to open it up a little bit more and not just exactly to the letter of the law but to the spirit as well.

And I think that's essentially what the concern is.

And, and Bob though, you look at investors how they're reacting.

I mean, they are taking this in stride.

I mean, Apple is actually up about 7/10 of a percent in today's trade.

Do you think investors, Bob, are they, are they being too complacent or no?

You think ultimately this is gonna work out?

Apple is gonna at the end of the day, make some tweaks that in some way, make regulators and investors happy.

Uh You know, I think it's a little bit of both Josh, I mean, bottom line is, again, it's gonna take a while before anything immediate happens.

So to react to the price to the stock today seems like it would be a bit much.

Uh I do think Apple is gonna have to make some tweaks, some things that they, they don't necessarily want to do.

But at the end of the day, again, it's an important enough market that they're gonna have to follow some of these requirements that the eu is putting into place.

And therefore long term, I don't think the impact is that big of a deal as far as uh the value of the company and the way people view the stock, I think there are other issues are going to be important for Apple to deal with uh in Europe.

And of course, this whole idea that they're not gonna bring their Apple intelligence features, their new A I stuff to Europe looks to be very interesting.

You have to wonder, you know, is there a little bit of chicken going on here?

Like, hey, if you're gonna take this away from us, then we're gonna keep some of these features away from people in Europe.

You know, I don't know for sure that's really the case.

But you got to wonder if that goes into some of these decisions, right?

And there has been some reporting to that effect, Bob, let's talk about then the other sort of related story related because if they're holding back on a if features and that's that they are looking to potentially partner with meta looking at A I now, I don't know if this is a big shock that Apple sort of is casting a wide net when it comes to its A I development.

What do you think?

Well, you know, the biggest shock honestly was the fact that Apple brought in anybody.

And then, you know, of course, they announced with open A I as being integrated into Siri uh which is very interesting because you know, the implications of that are that the entire Siri experience isn't controlled by Apple, I mean of course, yes, they give you the warnings, et cetera, et cetera.

But I think, you know, there's a couple of things going on number one immediately.

Even at the event itself, they admitted, yeah, we're talking to Google too as some of the reporting that, you know, um, we've seen other people talk about say, and then, so it's not a surprise at all that they're gonna talk to meta and some of these other big A I firms.

The bigger question to me is how is that gonna actually play out if I'm an end user and I'm using these Apple devices?

And I want to use these Apple Intelligence features.

Will I make my choice between, you know, chat GP open A is chat GP T and Google Gemini Pro and uh the meta Lama stuff or is that gonna be a little bit controlled by Apple or will it be region by region?

I mean, you know, Apple's install base being as large as it is any service that gets access to that install base, it's a huge benefit to them.

So, you know, Apple knows how valuable that is and I think they're going to be very cautious in the manner with which they deliver those capability and in which companies are going to benefit from that.

So that's, you know, my, my big question mark there is like, hey, how is this actually gonna work?

And, and then again, ultimately down the road, are there gonna be payouts involved initially.

Of course, there it was reported that there aren't going to be any but all these things can change.

It was interesting, Bob just the fact that, you know, reportedly Apple and Meta are even talking.

I mean, these, these two have, you know, they certainly have their kind of ups and downs Bob over the years.

You think of issues like ad targeting II I was interested though also just kind of a broader question too, Bob because as you mentioned, so, you know, Apple is partnering with open A I and, and now we have these reports that at least, you know, talking to meta.

I wonder if it also tells you something about, you know, as a tech analyst about where you think the real value is gonna be long term.

Is it gonna be in these LL MS these large language models we, we talk so much about or is that gonna be kind of commoditized and the real value down the line will be in the application later?

What, what do you think?

Well, it's, it's a great question, Josh.

And you know, I think bottom line is we at some point are going to see commoditization of these big large language models.

And I think Apple is part of what they're doing.

Part of that strategy is to say, look, you know, we're not gonna, we're gonna make sure not one company gets all the eggs in their basket because that would give them a lot more power and a lot more value.

So if it, in fact, they sort of spread the wealth as it were, it does start to commoditize the value.

Again, the question will be, how good is that experience?

And you're right, the app, that application layer in this case would be Siri or other services that Apple lays on top of that underlying search engine.

And you know, just as they did with Google for, you know, Apple search or for searching within any of uh with Safari and what have you um you know, where does that lie and where does that value lie and where do these things go?

Those are all questions that remain to be answered.

A lot of people still investigating that how these are gonna work.

Um I think it's critical that you do have some high quality large language models and I do think some of the big guys are gonna win and they're gonna profit from them in some way.

But there's a question of degree and is it gonna be more based on the way that the large language model delivers its uh information or the applications that leverage those large language models?

And I think we're still gonna figure those out Apple clearly for now is gonna focus on the application there.

But at some point down the road, you have to imagine they're gonna have their own answers so that they don't have to go outside because that's very atypical of apple.

And I think you're gonna wanna have them control the whole experience as they typically have always done with all their other services.

Bob, always great to have you on the show, my friend.

Thanks for hopping on.

Thanks, Jos.

Let's get to some trending tickers on Yahoo Finance.

They target start theres turn into Shopify to add new and trend your brands to its website.

Starting today.

Companies that work with Shopify can apply to joint target plus it's third party marketplace.

So that was the headline here that got attention.

Joint target says, OK, we gonna partner uh with Harley uh finin crew there at Shopify.

We're all for this kind of um selection merchants and their products and Target Plus, which is their their digital marketplace.

It's interesting just to listen to sort of target executives in their statements and now things, you know, they're really trying to hammer home enjoy this kind of sense of I curated experiment experience for Target.

Uh Target plus is sort of the thing.

They think they can make it different perhaps from some of the competition.

Well, to your point about curation, I didn't realize this.

If you wanna be a third party seller on Amazon, bring it on baby.

If you wanna do it on Walmart, bring on Target chooses it.

It, it doesn't improve everybody apparently, even though it can be a revenue line for the company.

And because of that, at least in part its third party offerings are much, much smaller and a smaller piece of the business than they are in a place like Amazon or Walmart.

And by the way, it's not just about the fees that these sellers pay to be able to sell on these platforms.

It's also the suite of services they offer around at marketing, um in some cases, shipping, although that it's not part of the Target plus services.

Um So it's quite interesting the ecosystem that has sprung up around these third party sellers and Target's trying to get like cooler stuff, it seems like on their platform.

That's one of the reasons that they're doing this.

I do not see financial terms laid out on this one.

But they, I mean, listen, both these companies could also use a lift.

I mean, t this year targets up around 5%.

Shopify has had a tough 2024.

Yeah, definitely.

Well, let's talk about another trending ticker today and really tickers is what we're talking about because we're talking about crypto here.

And what we're seeing is a pullback in Bitcoin but not just Bitcoin.

Many of the other coins are down Bitcoin itself having its worst day since March.

And then you see the Suite of Ethereum, even as we continue the drum beat to approval of a spot, Ethereum.

ETF Cardano Solano Binance, I saw Dogecoin is down.

The shea eu coin is down you name it.

There seems to be a lot of um pressure here.

Um And this is on top of selling that we had last week as well.

Um Some of what's going on here is just the ebbs and flows that we see in crypto there is.

However, remember Mount Gox that Japanese crypto exchange uh that got hacked into.

It's now as part of its whole process of recouping some of those losses.

It's gonna start apparently starting re repayments of Bitcoin and Bitcoin cash next month.

Um We're not July yet.

No, next month.

And so that's putting a little bit of selling pressure on too.

Yeah, that's certainly adding to worries about selling pressure.

Bloomberg pointed out, by the way, Bitcoin investment products, we saw around 600 million in outsource the second consecutive week, which was they say that was the most over a two week period since the US actually green lit uh those ETF S to hold the currency in January.

Well, yeah, and that's because there was all that money pouring in and now we're seeing a little bit of a stalling out from that.

By the way, the record for Bitcoin was almost 74,000 back in March.

Moving on.

Novo, no announcing it will spend $4.1 billion building out a new facility in North Carolina to increase the output of its weight loss drug.

Yahoo Finance's Angeli Kamlani joins us with more.

An That's right.

Uh no surprise here.

Uh Novo Norte uh adding to the capacity that it needs for those injectable G LP one drugs that's Wi Goy and Ozempic and it's doing it at the same time that Eli Lilly is we know Eli Lilly all.

So just recently did the R cutting for its new facility 1 million plus square feet in North Carolina adding to the injectable output.

Now, Nova Nordic saying that this is a 4.1 billion investment for 1.4 million square feet.

Uh Part of its goal to expand capacity by $6.9 billion of investment and is an increase from last year of $3.9 billion.

This will double the company's existing production capacity in North Carolina alone and in the US and then Senator Bernie Sanders today coming out swinging a little bit against Novo Norik over the pricing of the company's drugs.

That's right.

And finally a date set on that.

We had heard that uh Senator Bernie Sanders was looking to subpoena the CEO but he has now agreed to voluntarily testify on September 24th.

Yeah, about the difference in pricing in the US and elsewhere.

Meanwhile, the race for obesity drugs is continuing.

There's a smaller company called out to Boon that is trending today as they have some developments on that front.

They do, they have phase two results talking about their G LP one drug which they previously said had about a 15% total weight loss after 48 weeks.

But the good news and the reason why they're up is that they seem to have solved one of the biggest concerns which is lean mass loss only 22% compared to the average of all other incretins, which is what G LP ones belong to, which is about 40% and the fat loss is 78% of that.

So that is the reason behind that this is getting to be part of that market where we talk about differentiation.

How do these other companies stand up to these market?

Dominators and what makes them different?

No more Ozempic face no more.

That's, yep.

Yep.

And isn't that what we're talking, we're talking lean muscle mass going away.

All right.

Final take on it.

We just put, put you through the races here.

Teladoc moving high.

What was the news there?

Yeah, that's an interesting one.

So Teladoc, uh they had uh merged with Lavan Go, which is this diabetes management platform back in 2020 they did a huge deal there and that is what is coming to for right now because they found through A I and a little bit of research that using that platform and using personalized nudges, for example, uh leads to greater engagement and reads to lower A one C levels.

That's the diabetes uh insulin numbers that the diabetics look at.

So that has been something that um is really contributing to the growth in Teladoc interest, as we know, they've suffered through sort of the waning interest in telehealth alone because of post pandemic world.

And so now with this, it really boosts their uh enrollment in chronic care management.

So half of Teladoc enrolled, uh enrollment from last year alone was diabetes focused and they said they have more than a million in total on their chronic care platform.

So this is really good news.

Um Just as a reminder, Teladoc will acquire Levon for 18.5 billion in 2020 but then still logged a loss of 13.4 billion in 2022 because of Levon go's sliding valuation.

So this is looking to still build up on that platform and they're still sort of sticking to it all three tickers in like five minutes.

I know I did, I do.

Fascinating.

I I thank you, Ange.

Coming up, we'll check in on some of today's top analyst calls more market domination.

On the other side.

Paramount, the latest media giant to announce price hikes to its streaming service.

Paramount plus its plan will show time will now cost $12.99 and its paramount plus essential option will be 799 a month.

We're looking at how to navigate the big picture with the Yahoo Finance Playbook City managing director, Jason Basin joining us now to discuss, I don't know how essential the essential plan is and Paramount has a lot bigger fish to fry it seems than, you know, tinkering with the pricing of their, of their streaming plans.

Jason, I, I don't know, where do, where do they even fit in at this point?

Well, I, where do they fit in?

I mean, I, I would just give you the, the big picture.

Um, what if I sort of look at what the market is saying, the market is saying that Paramount is essentially going to be a niche app.

And I think these pricing actions are sort of consistent with that.

You can think of Paramount plus being akin to maybe HBO in the linear days.

Um I'll just give you one sort of metric we follow in the old linear days.

You paid about a penny a minute uh to watch Linear TV.

Uh Netflix today, the consumer pays about a half a penny a minute.

And even before these price hikes, uh Paramount uh was about two cents a minute.

And so they're just positioning this as a niche product um driving towards profitability.

Um Where do they fit in, in the broader ecosystem?

I mean, it's certainly going to be challenging um to be sort of the old Paramount, but there's still a role for niche players.

A a and I'm just curious, Jason, what, what kind of as you look ahead, you know, 6, 12 months.

Um I know you have a buy on the name, how much of that Jason is because you think, you know, ultimately, you know, this is an acquisition target and, and Sherry Redstone is gonna make a deal.

Yeah, it's certainly embedded in our, in our valuation.

But I can tell you if you look at those deals that were talked about either Sky Dance or Apollo back in the old days, um, there wasn't a tremendous amount of upside from M MA, there was some upside, uh, but it wasn't a huge amount.

And so do I think this asset, you know gets sold?

Yeah, I do think it gets sold.

Um Will it go for a premium?

Yeah, probably will.

Um But it's, it's sort of not the core tenant of our thesis.

What's really happening is, is investors are just climbing on to everything that's tech related, everything that's growth related and have just left a lot of these legacy media companies for debt.

I don't think it's that bad.

You don't think it's that bad?

So among those that are not that bad, what do you think is sort of the most overlooked that you would encourage investors to take another look at?

Well, I would just say, um if you looked at the traditional media companies, their multiples right now are sort of almost like newspaper multiples, right?

Roughly five times.

Evdeb da um you know, Warner Brothers, I would certainly put in that camp, even Paramount I would put in that camp.

Um The, the question is really the way I would frame it for investors is all of these companies are generating cash flow.

All of these companies are using their cash flow to pay down debt.

What's happened and that should accrue to the equity value.

What's happened over the last two years is the multiple is compressed.

And so the question here is, can the multiple compress further, you know, we've gone from eight times to seven times to six times to five times, you know, at some level, the the multiple compression stops.

And uh and then, and then I would also say that with these price hikes, what's going to happen is these streaming services are actually going to begin to generate profits.

So let me ask you, Jason bottom line, what would be the the top streaming pick for you in 2024?

Because you know, a lot of people Jason listen to, they, you know, they come on the show, they'd, they'd pound the table for Netflix, you know the king, the king, right?

The war's already been fought and won.

But I don't, you don't believe that you have a neutral on Netflix.

So what would you say, Jason give, give us the top pick.

Well, let me just give you if I can just give you the framework for what's actually happening.

I've run this by a lot of institutional investors and they agree what's happening is PMS are way overweight mag seven, right?

And they're, they're a little bit nervous because MAG seven has worked so well.

And so what they're doing is they're turning to their analyst and saying, give me a tier two tech stock, that's not a mag seven stock and they all, all the analysts come to the same conclusion, right?

Which is, oh, you just go buy Netflix.

And so what's really happening is that the multiples and the stock performance of some of these streaming, I'll call them tier two tech winners is really disconnected from the fundamentals from the narrative.

And it's really just sort of the afterglow of the massive performance of mag seven.

So it, you know, so what, what would I say?

I would say we're probably in the early stages of sort of mean reversion.

When will that end?

It's, you know, whenever mag seven stops working, right?

That's gonna be sort of the answer.

Well, it's been working less well, but that's just for a few days now.

So we'll see if that ends up last days.

I also wanted to ask you specifically about Disney given um inside out too at the box office and that seeming to be um a big take there um which, you know, obviously shows that people, some people are still going out to the movies.

So, um do you think that, that, you know, that, that also adds to the investment case for a legacy media provider like Disney?

Well, we're restricted on Disney at the moment.

What I, what I can tell you broadly for the box office is we have been slowly crawling our way back to sort of golden $11 billion of domestic box, which is what it was prior to COVID.

Um, we're sort of stuck at sort of the mid eights this year and, and I, I think that's just a function of poor movies coming out.

I don't think that there's a secular bear case on theatrical, but Hollywood's going to have to make better movies.

Um And so I think, you know, probably 2526 we'll get back to that $11 billion number and, and that'll be good for everyone in Hollywood.

It'll be good for the exhibitors.

Um But it's just been a lot of bad movies have been made.

Jason, always great to have you on the show.

Thanks for joining us.

Appreciate it.

Yeah, you bet.

Absolutely.

Thank you.

Now, let's get to some of our top analyst calls of the day Goldman Sachs resumes coverage on a firm giving it a buy rating slaps a target price of $42 on it.

So you need to buy a firm Julie, that's Corner Goldman.

Yeah, they say this one's a buy.

I think here's the money quote for that.

They were telling their clients we view a firm as the leading provider of modern credit solutions for consumers with a diverse portfolio of products, for point of sale financing and everyday spending.

Talk about the company's trade in underwriting compared with uh some of those fintech peers as well, which they obviously think is a real advantage.

Yeah, and that's something that a firm itself has touted as well.

Uh their underwriting prowess, in other words, that their portfolio is safer than some of their competitors, at least again, that has been the selling 0.1 of the selling points for a firm.

And you know, it looks like the folks at Goldman achieved there.

They talk about the company's strong track record of achieving well managed credit out despite growing faster than Pier.

Also, Goldman kind of looks into the total addressable market of B NPL buy now pay later overall and finds that there it's going to grow and then a firm is going to take more market share within that space.

Yeah, it has been a rough ride for firm so far this year stocks down about 30% but clear Goldman sees that as an opportunity, weren't they up a lot last year as I recall, pull back the chart, it's impressive.

Yeah, what 400% in 2023?

So I guess it's all relative, right?

Uh Let's also talk about Anheuser Busch here that stock was upgraded to buy from neutral over at U Bs here and the price target on that one going to 72.

So this is uh you're looking here at the US shares um but they gave it um the euro price target of of 72 there.

Um And they talked about the cash returns as being positive for the company or that the company will be able to return cash to shareholders and that'll be a positive.

Yeah, they see this inflection point coming when it comes to growth and margins and cash returns.

Um and really is, it's your point is that's for cash return story sort of takes hold.

They tell their clients, I think the investor is gonna be a kind of place more emphasis on that attractive free cash flow yield.

UB is not alone.

By the way, most analysts covering buds say it is a buy here.

Yeah, the stock down about 6% this year.

Still to come.

It is the latest edition of our series.

Goodbye and goodbye.

We'll take a deeper dive for two stocks to help you the best food to your portfolio.

Stick around more market domination over time after this.

It's a big noisy universe of stocks out there.

Welcome to, goodbye or goodbye.

Our goal to help cut through that noise to navigate the best moves for your portfolio today, we're looking into the sales and marketing software landscape and we've got a special treat here today.

Our BC capital market software equity analyst, she is with us.

Usually we talk to you remotely from the west coast.

It's a pleasure to have you here.

Wonderful to be here.

Thank you so much for having me.

Yeah, so let's get to it here.

Let's talk about the stock that you think is a goodbye right now.

And that is hubspot.

Hubspot up about 13% or so over the past year.

So let's get to why you like it.

You talked about, first of all that, it has sort of a single platform approach.

Why is that a strength for the company?

Absolutely.

And you know, look for those that don't know, hubspot very well.

It's effectively like a sales force that it does sales, marketing service, commerce operations.

However, in contrast to sales force that has grown through acquisitions over the past 1015, 20 years, hubspot built all of these on one single platform.

That means it's one user interface, one single source of data to do all of these different functions of what we call the broader CRM ecosystem.

I do believe that having all of these applications built on one platform versus disparate platforms is a really big competitive advantage, especially when it comes to gen A I.

And I know we'll talk about that in a second and basically it's simpler.

Exactly.

OK. Got you.

And then um if we talk about multi products sort of built on that single system, you think that's also an advantage for that, that's exactly it, right.

Because these things are so uh woven together really nicely and organically, they're seeing great success with multi product adoption that customers that started on marketing are now using sales.

They're now using service in ways that they weren't doing before.

And at the same time they are moving up market where customers may have started and then moved on to sales force.

They don't do it anymore.

They grow up, they become big customers and they still stay on hubspot.

Interesting.

All right.

So let's get to what you talked about.

And that is the gen A I part.

You, you like their gen A I road map.

What is the A road map?

How are they using it?

Yeah, to me, what's really important when we think about software companies A I strategies is, are they bolting on A I or are they fundamentally re architecting and changing the way their software works to be A I first and A I native?

And that's exactly what I see out of hubspot.

I would argue they have probably one of the most impressive A I road maps of any company in front office application software.

You see new use cases that you can unlock from it.

You get new insights into your data pipeline, build opportunity generation.

These are not just making you more efficient but making you effective in ways you could not do in a pre gen E I world.

Got you.

We always talk about what a potential risk to the upside here.

And in this case, maybe tech, what do you mean by tech ceiling to enterprise?

And what that means is what if there's a certain limit of how big customers can get that they can go after.

Right?

Because that's really where the enterprise the opportunity is, is large enterprises, right?

Fortune 500 Global 2000 hubspot.

Absolutely as their hands full, attacking SMB and MID markets today.

But over time, I can imagine their ambitions are to go into the enterprise.

Remember sales force began as an SMB tool going after the Behemoth.

That was cable and local sales forces today, I can see helps do the same thing, but it is really important that their technology can scale and they have those enterprise grade features and functionality that really large companies like ours actually need.

Um There's one more thing I have to ask you about hubspot and that is it has been an acquisition target rate.

There's been a lot of chatter around company, there have been some questions.

How does that sort of play into your thesis?

You know, to be quite honest, I actually think hubspot could become a much bigger company on its own rather than getting swallowed by a larger company.

The rumors have been out there around Google.

And while I think Google would love to own this asset, this is a top tier asset in enterprise software.

Um I do not believe the regulators would allow it.

They would not allow Google to make their largest ever acquisition, right?

It would be $40 billion to get this deal across the finish line, youtube.

Was billion dollar acquisition.

That's been really controversial in, in retrospect.

So I don't think a deal happens, but I think it's actually better for hubspot long term that they go at it alone.

Interesting stuff.

All right, let's get to the stock that you do not like here.

And that is Zoom Info.

And now Zoom Info shares are already down more than 50% over the past year or so.

And you still think it's not a good buy.

So let's talk about why here some of it is Macro.

Now why is Macro affecting Zoom Info more than perhaps some of their competitors?

I think there's a couple of reasons for that for so for the that don't know Zoom info, it's primarily contact data to help sales people better reach targets like lead generation, lead generation.

And this was super, super important during the heyday of 2020 2021 when there was no such thing as bad spending in software, things have changed since then.

And so Macro, I mean, if you can imagine they're very, very exposed to the software vertical, to tech, to start ups.

And that's where we've seen a lot of the layoffs happening.

And at the same time as every company is trying to pivot themselves more towards profitability.

That means they're more their focus is more on growing with existing customers rather than landing net new logos, which is the bread and butter of what Zoom Info is used for you and they're fighting for that pie with other companies.

That's exactly it.

The competition is getting a lot worse.

Three years ago, we used to talk about how Zoom Info had the best depth and breadth of data.

And I think competitors have significantly caught up to them, most notably Apollo, which is in this space and then hubs actually made an acquisition in this space as well and I can imagine they're just gonna give it away for free to their large existing customer base.

Zoom info is an expensive product.

Um I think their list price is 10 to $15,000 per user per year, effective price probably a lot less than that.

But that is going to put a lot of pressure on them.

And then at the same time when their competitors are getting better, I think that's a tough combination for Zoom.

Well, and then Richie, the other thing is we, we continue to have this debate over what A I could potentially replace what gen A I could replace and you maybe Zoom Info might be on that list.

I think that's, that's absolutely right.

Look LL MS are really good at scraping the web.

That is what they do.

And that is one way in which Zoom info gets their data.

And look, I I live tested this.

I used one of the L MS out there and I said with my prompt, I am a, an Aws sales rep who are the 10 people I should reach out to at General Motors and it gave me their names, titles and linkedin profiles.

It's really hard when I can do that for free with a publicly available LLM to pay however much Zoom info costs.

What could go right for Zoom?

I mean, because this seems like a pretty negative scenario here.

But what, what could they do?

I think the big thing they need to do is build up the stack, right?

They have this data asset that was differentiated, maybe it's getting more commoditized.

But if they can use the large install base, they have and all the data they have and build, I think really useful value added applications on top of that.

Think about, you know how Aws went up the stack and build all these functionality on top of the core storage and compute.

I think if Zoom Info could do that, that could turn things around.

I have not seen evidence that Zoom Info knows how to build really good software yet.

Interesting.

Well, we'll be watching for any of that kind of evidence and just to be clear for folks who are watching, you don't have a position in either.

That's right.

I'm not allowed to own any of these.

Good to know here.

We thank you so much by hubspot.

Avoid Zoom info right now.

Again, great to see you in person to see.

Thank you coming in and thank you.

So much for watching.

Goodbye or goodbye will be bringing you new episodes at 3:30 p.m. Eastern Josh.

Thank you Julie.

And while we're wrapping up today's market domination, don't go anywhere.

We've got you covered with all the action following the posing bell and stay tuned for an exclusive interview with Treasury Secretary Janet Yellen at 4:40 p.m. Eastern.

Today to discuss a new slate of initiatives to support housing development.

Don't go anywhere market domination overtime coming up next.