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tv   Tech Check  CNBC  December 20, 2022 11:00am-12:00pm EST

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widespread jitters for investors and the markets. so the expectations are pretty low going into this. but we'll have to see what commentary is and whether these are two names that can meet those expectations. >> that will be key. that will do it for us right here "tech check" starts right now. >> thanks for being with me. >> left me hanging >> left me hanging ♪ that was cold. good tuesday morning and welcome to "tech check."
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i am with frank holland, back with me on the desk despite that karl and dedra are off again floors and ceilings, providing a ceiling that the bulls can't seem to cross. while private equity buyouts and mna staying active, despite the floor. more news on the ceiling after the bank of japan, widening their target range, hawkish behavior from central banks that could mean more pain ahead for growth stocks. let's get to mike santolli with more that's not what's happening today? >> exactly look, i think that has been the general macro overlay that caused a rethink of valuations yields have been part of the story for gross stock underperformance this year but if you look back at prior cycles, it is not the full
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driver to me the absolute level of valuations at a time when the big growth stocks are not showing growth is the story. this is the forward price earnings multiple of the nasdaq 100 relative to the equal weight so basically the typical stock blended in for the s&p 500 this was the premium in late 2020, into 2021. that's because we thought these big platforms were pep pet rpeta earnings rates but that's, to me, a secondary piece of it. i don't think you have to go that far to figure out why you had the underperformance this valuation gap is part of it apple and microsoft, we're talking 1% to 3% earnings growth it might be wrong or right now analysts are seeing five and a half percent earnings growth the likes of meta and amazon
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down 40% to 50% from where they were several months ago. even things like netflix, alphabet down 20%. for me, it is a realization that the growth stocks don't have as much growth. at the same time, you have yields going up and causing a rethink on the valuations for what you pay for each dollar of those earnings. >> so in a way, it's not just fields making investors rethink. it's just relatively stable and reliable stocks. some of them like apple with dividends. the fact those have come down you think, well, for upside, you don't have to look that far field. >> that's what it is you can look in the shorter term, right? the ten year treasury yield was at 4.2 it went down to three four we're up to three six. so we're lower on yields the nasdaq is lower since that point. you can't draw the realtime this is the whole story type thing. i will go back to prior periods when you had the one group with
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such mega leadership for many years that ends up, you know, the hyper concentrated at the top of a market psych m. they do tend to underperform for a period of time there after. >> wow, okay frank, we got tesla down 4%. airbnb up 4% i don't know what to make of that but i do know we're in the last day of the year for people to get stuff shipped. there is a big question, is the consumer tapped out? maybe we will find out something tonight. >> yeah. speaking of big name companies, you just named two facing pressure abroad. fedex results, a few key things to watch the details on its $2.2 billion cost reduction plan. a looming global recession was weighing on volumes. we're waiting to see what he was talking about there. $700 million of those savings from cutting flights and staff hours expected in this quarter
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and more on how e-commerce is holding up huge discounts across the retail landscape. important to note, the quarter reporting today and a few days after what some believe was a deceivingly strong black friday, amazon included, that could be volatile for this afternoon with analysts estimating the company could report its lowest operating margin since 2001 if you do not include covid. >> ouch. what sent chills down my spine was the costco ceo saying not such an exciting christmas, particularly when it comes to apparel, when it comes to furniture, when it comes to stuff that isn't food, people are pulling back with fedex reporting tonight, how much of that is going to be reflected? then with the covid lockdowns we have seen, we're 33 days away from lunar new year, right >> yes. >> does that play both ways on supply and demand?
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>> fedex is going to see 4% to 7% lower volume when it comes to holiday e-commerce from black friday to christmas. obviously that will weigh on revenues and hit another source of revenue, which are retail surcharges they have been able to charge their big retail customers more money to ship boxes over the holiday if it is over their volume from earlier in the year. they generally base it on february it doesn't look that fedex will see those surcharges this year you mentioned lunar new year that will be a huge story. the news out of china shows covid may be worse than we expected the reopening may take longer than anybody ever thought. what does that mean for lunar new year anybody's guess. but fedex has levered the china, china air freight and china freight in general. >> yeah. singles day was barely a blip this year. we didn't talk much about it so we'll see if this can recover.
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amazon shares had given up now all of their pandemic gains after a near 50% slump in 2022, given a murky outlook as we were talking about this holiday season what should investors do with e-commerce names heading into the new year joining me to discuss, the big technology newsletter. alex, good to see you again. so, i mean, looks pretty bleak does that mean it's time to buy? >> well, look, the last time amazon had a decline like this, it dropped 80% in 2000 and the people that bought, is it done dropping it's down 50% on the year. it's not exactly the same future as it was back then. but it seems like it's much cheaper. first off, first time i have ever seen you in a tie you are throwing me off.
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john is always making fun of me. i like that. >> out with a note yesterday that the majority of amazon's retail business is consumer discretionary. maybe as much as 80% of it obviously, the consumer is softer than it has been in years past how do you think that weighs on the results? people aren't buying their groceries from amazon. they're buying other things you want. >> look at the amount of money that's going to go through amazon and it puts cold water on this idea of a massive slowdown. before the pandemicin q4, amazon did $87 billion in revenue. this quarter it will be $140 billion at the floor, right? so it is not like the company is falling apart. it is coming up against a very different investor climate and expectations that have been out of whack as that modulates, it may be a different story for amazon, but i don't think amazon will
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struggle in the way people are painting it out. this is not a doomsday scenario. >> part of the reason why i wonder is earlier this year there seemed to be this big decrease in faith in amazon with their oversupply in the warehouse business and then hired too much and, oh, has amazon lost it did that cause the kind of reset where now we see the stock back down near the lows of the year it actually might be cheap even, you know, regardless of how the holiday season ends up maybe cheap is too strong a word reasonable relative to some other things. >> yeah. it is a lot more reasonable than it was when it was double the price. but the bear case for amazon is completely reasonable. if you look at these companies, they're valued highly because they have high margins and grow fast they are not growing as fast as they were during the pandemic, which is expected. amazon itself believes the growth curve be keep going
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take a look at margins, which is the second half of the equation. the company built as if that growth was going to continue and it built like crazy without fully understanding whether those would be needed. and now it has a moment where it has to cut costs so you're looking at growth that isn't as high as expected and margins that aren't as high as they could be because the company needs to cut costs now if you are thinking about whether to invest in the bull case it will be a struggle on that front. whether he has the ability to cut costs as if you would be a retail ceo it's a completely different world than when you come in and now you're in charge of the retail business, which is much, much more difficult, much more cut throat if he can show he can do that, amazon will be in pretty good
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shape. if he continues to struggle, investors will probably be in for more pain. >> when it comes to their retail business, a thought of people felt they built their church for easter, if you're familiar with that saying. one thing we haven't talked about is the rising dollar they're getting a break this quarter. the dollar is down 7%. >> the dollar right now is coming back to earth it was so strong for a long time but it is starting to modulate and i think the foreign exchange headwinds that companies like amazon and fellow big tech companies aren't going to be the doomsday scenario, the end of times like they thought it would be it could end up being less of a problem. >> talk about e-commerce ran a little bit larger.
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s shopify was down back in october. it's bouncing back might that be having for investors investing in e-commerce to be a bit more cautious about >> i think spopify is one of the companies that ended up getting an overdue bump due to the pandemic of course it has the store fronts people went bananas with those when they were stuck at home but it doesn't have the fulfillment capabilities that amazon does. that being said, it is getting the lift that you would see. again, before the pandemic, e-commerce was 15% of total retail you're getting everybody in e-commerce will get a boost that way. but the investment thesis on shopify to me is still coming
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into focus >> yeah. they will be building up that capability alex, big technology newsletter, thank you. >> thanks, guys. coming up here on "tech check," is apple's next growth thin tech? and what it means for the other competitors in that space. we're just getting started
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time for gut check shares in wells fargo in a $3.5 billion settlement that's over customer abuses tied to bank accounts, mortgages, auto loans and fees. the bank will pay a civil penalty and over $2 billion to its customers. it will be very interesting to see if there is any impact on thin tech stocks. >> it will especially because i'm thinking this happened back in 2016, back when bitcoin was a baby, right and people -- i mean, we're getting the fines now. >> right. >> but this is back when people were really not trusting banks and thinking crypto is the way to go. now things reversed a bit. >> more than a bit more than a bit on the reverse.
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>> yeah. >> i think really the question is can those online banks, sofi, can they offer the same services that a physical bank branch can offer. now people are back out and about. maybe you want to get that face to face with your banker. >> yeah. the interest rates on those savings accounts are pretty nice, up above 3.5% right now. apple invested heavily in thin tech, beefing up its apple wallet with more features on the way. while our next guest thinks the company could move passed it, is it worth it? we have seen public thin tech firms lay off this year including plaid, stripe and cards. sanjay, not even looking that far field, just looking at apple's partner in this space, goldman sachs with marcus, that hasn't done well
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where is the opportunity here exactly? and is apple in a way using thin tech as a loss leader to fuel just overall volumes and loyalty? >> yeah. i mean, i think that's commonly perceived as the case, right i think they use payments as an engagement vehicle for their customers and the idea is to get people using their phones more and buying more phones in the future that's where they're monetizing today. and the question is can they start circumventing some of the economics down the payments volume chain. >> what is the innovation, then, in thin tech right now going forward? now that we have gotten through the 2016 wells fargo and having our come to jesus moment with crypto this year, where is the real innovation? >> i think it would be creating simple use cases i think there is a lot of friction inside the ecosystem.
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if they could provide connectivity, that could be significant value creation and generating revenues. also, there is a lot of intermediaries in the value ecochain they can streamline it in the future and that can open up a lot of different options for themselves. >> you are hitting on the intermediaries right now apple partners with twocompanies one is too smart to mention. the other one, why not just acquire those companies and get the functions we're seeing in reports? they want to do risk analysis, credit checks, basic stuff it is not massive innovation by any means. >> i think there is two sides to that i think on the payment side definitely they could acquire something. they built certain payment processes internally as well, so i think they can just use some of the technologies they built
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internally from a payments and processing standpoint. from the financial side, i don't know they want to go down that path you mentioned green dot. green dot is a bank holding company. banks are heavily regulated entities i'm not sure apple wants to go down that path apple's aspirations are not in the united states. it is more global. they have to go out and do that across the world in theory, right? that would be a lot of different domiciles and regulations to have to deal with. >> what about pay later? isn't that a risky business, especially with a softer consumer i work with some companies that are apple suppliers. apple is known to take a long time to buy its suppliers. why would you want to get into a business where potentially your customers take a long time to pay you. >> i mean, the pay later is a pay in four over a pretty short period of time, maybe a month and a half to two months it is not a long duration loan so to the extent that people do start defaulting more, they
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could shut that down quick but the other most important topic or point is it is not on their balance sheet, right it is through their partners they're using for the credit risk from an apple standpoint, it increases engagement and utility for the phone. >> apple is famous for not buying the cow when they can get the milk for free. even though apple can afford more milk than anybody, they're like, no, i don't think so i think we're not going to buy that cow so, therefore, where does it leave companies like affirm, like block now with after pay that argue they have these better risk models that will see them through this period and, yet, their stocks are suffering in the market. is this a moment of opportunity for investors looking at those given that apple is not going to get into this space you project and, therefore, if their model works, perhaps they have some running room. >> so, you know, we don't cover affirm, so i don't want to speak
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to affirm directly but we do cover block. we think the deal for after pay remains a good one obviously we're at the tough part of the cycle where we might have an impending recession. but the credit risk is manageable here. i do think buy now pay later payments are relevant for people down market because they don't have a lot of options in terms of credit availability as far as mass market lenders, i do think there is a lot of options for getting loans, for the average consumer in the united states. so i don't see a whole lot of utility there. i have been covering consumer finance for over 20 years. you know, we started in america dropping credit cards on people, right? so credit cards came before debit. i think credit is a pretty mature market. so i don't really see, you know, a significant change occurring from that angle. >> well, i will be curious to see how that pans out, especially given what intuit
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says they are seeing a lot of creditors pull back. thank you for being with us. >> you got it. >> all right still to come here, three firms called microsoft their top pick for this week. whether it is worth buying here. that and much more after the break. don't go anywhere. more "tech check" coming up. y that's smarter than the dial, with ge profile smarter wash technology. more care for your cashmere. more power for your workout gear. this is smarter sensing and dispensing. fully optimized cleaning, no more guessing. getting the best out of everything that goes in. ♪♪ this is smarter cleaning. this is ge profile.
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welcome back to "tech check," everybody. here is your cnbc news update. more signs of weakness in the construction sector. building permits sank more than 11% last month more than triple what economists had forecast housing fell less than expected but still fell to a two and a half year low. general mills is down more than 3% despite posting strong quarterly results and raising guidance manufacturering constraints limiting the production of dog
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food and animal treats 3m will stop producing forever chemicals within three years they have been linked to cancer and low birth weight 3m says this move will lead to pre-tax charges of $2.3 billion. and kroger limits the sale of children's pain and cold medications. it joins cvs and walgreens john, nothing is likely to spark parents rushing to the children's section of their local drugstores like the thought that you will have a sick kid andno way to make the feel better. >> now you want to go get it even if your kid is not sick, especially given rsv and all that stuff going around. microsoft getting a lot of love from the street this week. morgan stanley calling it a top this week. all three firms highlighting the stock's strong margins of cash
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flow calling it a longer term pick worth buying at these levels stock priced earnings now trading around 23. that's not cheap after starting the year at 33, definitely not cheap stocks are down 30% year to date as you and i know, be careful when everybody loves you what is potentially wrong? you have to do investors and viewers that serve what is potentially wrong with microsoft? >> a potential slowdown in their cloud business of course is one threat the revenues will be is the growth that investors looking for going to be there? if there is a slow down, longer for deals to close salesforce is saying there is a shift in the business. what does that shift mean for this particular scale. does that mean people are shifting to gcp or over to aws that's a question for microsoft. that's the big risk there that i would see because their cloud business is obviously the growth
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engine. >> there is also the bundling issue right now. people starting to say microsoft likes to say you are getting office 365, get this as well that worked during better times. during these times when people are looking to push back from the table a bit, maybe the bundling doesn't work as well. also, if you look at the consumer gaming business and blizzard, the more that looks like it might take longer to get through the regulatory pipeline. >> yeah. but that's a catch 22. a lot of customers are saying, hey, i just want to go to one vendor can microsoft provide everything that people want in one vendor a big thing obviously cyber security. >> yeah. you can play your x box while you get your cyber security services who else offers that >> nobody offers the x box obviously. i mean, you are asking a question that only has one answer. >> if you really want a one stop shop, come on. >> obviously microsoft has a big suite of products, but do they
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narrow in on things their customers want yeah, you can sell me this product. but are you helping me to optimize what i have and tailor-made to my needs. where is my data at? can you help me do that as well? >> yeah. microsoft will try. >> yeah, certainly. >> all right moving on, a long list of initiations in the software space. getting a very bullish outperform rating heading into the new year right now we have the endless behind all those calls he joins us right now. thank you for being here we appreciate it. >> sure. thanks for having me. >> i want to start off with the names you mentioned. a lot in the cyber security, crowd strike, data dog and octa. a bullish outperform for all of them does that mean demand is going
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up for cyber security in 2023? we're expecting to see cyber threats or cyber questions but we haven't seen or at least haven't become public just yet. >> sure. looking at the stock drivers with the numbers suppressing a lot of the sort of slowdown that is expected next year. so the frame work is not just made on demand alone it is based on where are the numbers of the stocks. given the stocks, demand is holding up better than other names. but there is a little bit of slowdown we had strong spending over the last two years the topics are based on not just demand but what is being priced through the stocks today it is based on what these stocks are reflecting today and what it is like. there is a lot of that probably
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is reasonably expected but at the same time, the stocks are pricing in a lot of that. >> got it. not just demand driven but two other factors we have to talk about is the dollar and also rates. we see rates jump up this week however, the dollar is falling strongly this quarter. how does that play a factor in your call? >> we try to factor how much interest rates are being priced right now. look at that chart, you know, the last time rates were this high was back in '07 and '08 back in '07 and '08 and compare that to where the valuations are today. we think most of the prices in great today. so i think a lot of the stocks are pricing in and focussing on interest rate. the risk of these stocks comes from the numbers there are some names that still have high expectations that's where we think the outside risk is coming from. >> let's talk technology and
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advantages for a moment. when i look at and talk to the likes of crowd strike and z scaler, they talk about the power of having a platform that can let customers try before they buy, retain them and upgrade them into new services as needed. but then you have also got younger firms out there not yet public like arctic wolf that will argue it's gotten too complicated managing your own cyber security so their employees will tailor make the cyber solution for you. of those things, what do you think is the more important play heading into '23 and beyond that will spark the greatest growth >> sure. so i think it's a bit of both because companies already have a lot of it investments and staff. a lot of these companies can manage that themselves they will continue to buy the software
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smaller companies can't afford to invest in their staff they will move to the speed of the managed software you keep buying these products from a managed provider who can manage your it for you so i think it is a bit of both smaller companies don't have their own it expertise will gravitate towards a managed service offering i think it is a bit of both. >> i want to bring back the demand questions a few weeks ago, you had a strong report. what the metrics you are looking at that signal to you their customers are happy and continue to pay >> so we look at -- it depends on the model mo
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models have a business that is consumption-driven so companies can manage that on a quarterly basis or monthly basis you want to look at billings and bookings and rpo, which will give you a sense of how much people are committing to forward spend. revenues are important but we look at billings and ipo to get a sense of commitment and it will be what people are buying today to spend in the future. >> we have to let you go but are you buying the story that the deals are just taking longer to close, that's why some of these numbers are softer? >> we heard that with checking with cios and general partners that deals are there in the pipeline it is taking long to close these deals. these deals need more approval staff than they were taking in the past i think that's true. demand is not gone completely,
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but there is obviously a digestion phase after two years of strong spend. there is a little bit happening given what we are all hearing about the macro and recession next year. deals haven't gone away, but there is a little bit of slowdown in the approval process. >> all right we have to leave it there. we appreciate the insight. thank you. >> thanks for having me. now signs elon musk might finally be throwing in the towel on leaving twitter the new twitter owner is officially searching for a new cpo, despite initially tweeting on sunday there is no successor. of course that person will have to report to elon musk we will continue to watch that story. "tech check" is ckn itw
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welcome back to "tech check. time for a gut check with rivian an overweight rating price target of $30. bullish on the company's truck and suv lineup and their vehicle partnership with amazon. and then there is lucid, announcing they closed a $1.5 billion raise. the majority of that cash coming from an affiliate of the saudi public investment fund take a look at the stock right now, up almost 3% on that news isech check" back right after th will help you create a comprehensive wealth plan for your full financial picture. with the right balance of risk and reward. so you can enjoy more of...this.
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this is the planning effect.
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welcome back meta officially closing back the closing tate for its planned purchase of unlimited as they continue to face-off with the ftc over antitrust concerns. we're just an hour from the conclusion of the evidentiary hearing in san jose. steve kovac joining us with more at the root of this issue, can you have monopoly powers in a market that doesn't exist? >> the ftc maybe one day we will all be wearing computers on our
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faces and doing fitness exercises in the metaverse that's not the case today but the case they are trying to make right now. they make a relatively popular app called super natural i guess they have seen some good use cases with it. but it also speaking to meta's overall vision towards the metaverse. they're waiting and looking at the data to see how people use it to inform acquisitions and content like this. yesterday the cto of meta was in court testifying on this case saying we're bad at making content, so we need to acquire the content in order to be able to compete in this. >> can you afford to testify in court that you are bad at it first of all, i'm sorry, frank, you go ahead. >> no, no. go ahead >> i just know when i get ahead of steam about these metaverse trends but this is perhaps part of the question is the ftc serious about its
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legal case here or is it playing chicken with these companies boy, when we put up a fight, some of these companies back off. >> the chilling effect, yeah. >> and so we count that as a win. doesn't seem like zuckerberg is backing off, whether it is on spending billions on these on fighting the ftc. >> and this seems like a slam dunk for them. this market doesn't even exist it is hard to say it exists because it is so tiny and the use cases are sonar row. how many players are there meta, two headsets apple maybe next year and sony mostly focused on gaming, plug it right into the playstation. the market barely exists maybe one day it exists. maybe 15, 20 years from now. right now it doesn't. >> frank, you have one of these at home. >> you know, i do have one at home and i never use it. you get on their one time. it is like, oh, man. i'm a concert. but you can't play games with people that well it is not immersive.
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i think my real question to you is what is mark zuckerberg going to say today that will make sense to the ftc and his investors? >> yeah. he has to sell -- he has to straddle both things, right? he has to sell his vision in saying this is going to be a thing. this is why we need the company. at the same time, he has to make it sound like we're not good at it we need to acquire this company in order to compete before apple sweeps in or sony sweeps in and they did mention some of those companies yesterday saying there might not be a lot of competition now but it's coming. >> all right and apple, meanwhile, is making fun of the meta verse. >> there was another thing he brought up yesterday saying we had to buy this company because we were hearings rumbles that apple was going to buy it. he's making competition here so they really believe it will
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be apple versus meta in this. >> speaking of, i guess mark zuckerberg arriving right now. here is the video at that hearing. you can't get sheryl sandberg to go to those things anymore he has to go to himself. >> yes she's relaxing right now. >> she got out at the right time that was one of those tops, perhaps, in social stocks you could change on. between changing the name to meta and sheryl saying i've had enough, that would have been a good time. i remember that walkway in san jose. >> yeah. theranos was there too. >> a lot of action there we'll see what kind of action mark zuckerberg makes. long time from the hoodie days he is wearing a tie. this is not good for me, frank a turtleneck would have been better but, no, this is an important moment when it comes to regulations. we were just talking about, steve, because the question is can -- can you do a short of
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back to the future regulatory approach where because this might be big in the future we're going to regulate it now regulators did get a lot of heat for allowing facebook to buy inst instagram. >> and whatsapp. >> instagram could have been huge and the argument was, well, if we had done more of a look into the future of what this could have been, we shouldn't have allowed facebook to buy. >> they're allowing regulators remorse. that's been the thesis ever since she got this job by the wa way, that's why biden appointed people like her to these positions because maybe they're losing these cases we were talking about the biden's administration in killing these deals not very good with the exception of the simon and schuster deal. is it just to put a chilling effect on it or is it just to make a point >> is this a type of market
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where you need to be killing potential transactions where somebody with billions upon billions of dollars wants to spend on some entrepreneurs idea >> and then the question becomes how do you prove that? >> yeah. >> how do you prove one day this will be a dominant way we use computers. >> maybe in this market you don't want to give silicone valley a cold shower that way. the best chip stock to own in the new year? bet on materials equipment maker likes nvidia, the chip maker find out why with both those analysts next. standby. we're back in two. smarter than, with ge profile smarter wash technology. more care for your cashmere. more power for your workout gear. this is smarter sensing and dispensing. fully optimized cleaning, no more guessing. getting the best out of everything that goes in.
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let's get a check on the broader markets, the major indices. the dow is up slightly about 49, 50 points. the s&p about exactly flat, and the nasdaq dn stowju fractionally tech check is back in a moment
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welcome back let's turn now to chips. while cowen goes with applied materials. they've both got analysts and both with us this morning. joining us now to discuss, welcome to both of you let's start -- where are we going to start tell me about the tradeoff as you see it between equipment versus the chip player and which
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way. >> our focus has been on applied materials. when i look at my front end and large cap of applied materials, these are all high quality companies. and high quality names they're going to be extremely valuable over the next few years especially as semiconductors become much more important when you look to the other side of it analysts do tend to gravitate towards companies that have a deep moat like i mentioned earlier many of these names i highlighted are high quality names >> let me turn over to you talking about nvidia
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i was looking at the last earnings when i look at margin that was a miss when i look at operating income that was a miss. needing cash from operations was a huge miss. there's weakness in data centers, there's weakness in game >> the balance sheet is just one aspect of nvidia i think the bigger issue that nvidia experienced the kind of trifecta of hardships this year. there was a crypto currency collapse there was an impact on the gaming revenue related to slow down in china. so there was a combination of events that had a negative impact on their fundamentals and also on the stock price. so as we go into calender 23 a lot of those headwinds are going
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to turn into tailwinds with respect to gaming specifically, the gaming segment has been clearing out. they've been clearing out a lot of extra inventory that's been built into the zrikds channel this entire year so nvidia the undershipping, we're going to reach a bottom in q1 and we are going to see a rebuild of gaming. >> i can see where you're coming from at least on the long-term argument that equipment is going to be important because there's all this demand. eventually that equipment has got to go somewhere because the world needs chips. but applied materials was as low as 75 and now up near 100. and we're getting into this oversupply situation
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is it possible in the beginning of 2023 we end up with a situation where the stock goes back down there if the economy heads into a significant recession? >> sure, i think that's a very valuable question and one of the things we talk about with investors. to your point it was 75 in mid-october and now it's 104 the bigger question to your point is the lows i do think it's possible. but the market is already discounting a weakness in spending next year and we see relative growth and i think that's going be positive for the stock.
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>> with the news we have today and covid possibly being worse than we suspected, how much down side risk is china, covid continuing and those lock downs continuing into the new year >> i would say it's more like the second or third. that weakness is discounted. to your point if there's covid shutdowns going to impact any demand in china over time but it's not going to impact semi equipment companies right away might impact more the end chip supplier into the chinese market but from an acute standpoint it's more the controls went into effect in october. >> got to leave it there
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thank you. >> frank, quite a morning. lot of market action >> mark zuckerberg appearing in court. up 3% as we head toward the half, tesla down 5%. good software enterprise, bad cars perhaps thanks for being with me, frank. the half time report starts now. yes, it does, guys and welcome to the half time report, everybody. and good tuesday morning or evening if you're overseas in for scott once again, a surprise moveon global interes rates. we'll tell you about, the megacap mauling and caps struggling how do you position yourself today, tomorrow, in the next year, we're going to talk about it as we head into the homestretch of the year and even take a look into next year hard


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