Announcer 00:00

Today’s episode is brought to you by Savvy, the smarter way to book a vacation rental. Travelers save $400 on average; always check Savvy.com first.

Frank Curzio 00:11

How’s it going out there? It’s Wednesday, July 29, I’m Frank Curzio. This is the Wall Street Unplugged podcast where I break down the headlines and— Say what’s really moving these markets. Mr. Daniel Creech. What’s going on, man? How’s everything?

Daniel Creech 00:27

How goes it, Frank? Big fireworks up on Capitol Hill today. Have you watched any of the, uh, Anthony Fauci testimony?

Frank Curzio 00:36

I haven’t got a chance to watch it. It’s probably going to be awesome and entertaining as hell. Is it? You watching it?

Daniel Creech 00:42

Well, he’s pleading the 5th every time. But—

Frank Curzio 00:44

Oh, is he?

Daniel Creech 00:45

Shout-out. Not just because it’s my home state, but Bernie Marino dropped the F-bomb. The actual F-bomb, not Florida. And he was talking about—he was ripping Fauci about what he did and all this kind of stuff, and why he, Bernie, got motivated to run for Senate. And he says, “Who the—” “Do you think you are?”

Frank Curzio 01:08

Is that right? He invoked the Fifth Amendment 111 times?

Daniel Creech 01:12

I mean, I don’t—he said it every time that I was breezing through it.

Frank Curzio 01:17

Wow. That’s great.

Daniel Creech 01:19

And really, the craziest thing here is—and everybody should watch some of this, just in my opinion, because—you know, and I’m guilty of this too—you can forget so quickly. But it was just absolutely horrible what happened during that timeframe, and the abuse of power, and the real kicker that should upset everybody is that nothing happens to anybody. So there is no punishment, there is no accountability or anything. And that is only going to get worse and make everything more volatile, unfortunately.

Frank Curzio 01:46

Yeah, it’s so great. I mean, these politicians can do whatever they want. You can catch them on tape, catch them on video, whatever. Catch them burned documents, whatever it is, and nobody ever goes to jail. Such a great job. And your net wealth automatically increases by 100x over a 10-year time span, no matter what. They don’t know how it happens, even though they make, what, like $200,000 a year, but no matter what, they’re going to—their net wealth goes from, what, it’s, uh, you know, less than a million to like hundreds of millions out of nowhere. Which is great. But when you look at this and you look at the initiatives and what really took place and how effed up this is, it’s—I mean, they were filling like kids’ playgrounds with sand. I think people forget during that time of everything in place that was forced on us, where there are nurses that, if you did not take that shot—and again, that shot when it came out—and I know everything about this. We had leading doctors reporting to me, which is great.

Frank Curzio 02:37

We had statistics up there before Johns Hopkins. It was unbelievable. I mean, you know, and all the doctors just started coming to me and saying, “Hey, you can’t say my name anymore. You can’t say anything.” I’m like, “What are you talking about? This isn’t about stocks. It’s about safety.” I mean, you know, I have kids and everything. And they were like, “No, there’s like a huge agenda going on here, and you say the wrong thing, they fire you.” I said, “Are you—you got to be kidding me.” But some of the effed up things is, you know, forcing people to take this for something that did not have FDA approval. It was fast-tracked. You did not know the risks. You were told, “Once you take it, you will not have to worry about anything again. You’re not going to get COVID.” Then all of a sudden, the boosters came in. And then you realize this is really a bad case of the flu. If you want to look at statistics, how many people get the flu every year? It’s like 20, 25 million. How many got them in 2020? It was zero. And how many people got COVID?

Frank Curzio 03:23

20, 25 million. So it’s a very bad form. I think people who spoke up like us, where we weren’t anti-vax, my mom has underlying conditions. I thought people over 65. We knew this data four months in of how it doesn’t impact—this still hasn’t been a child, at least in the U.S., that has died from COVID that did not have underlying conditions that is under 12 years old. Think about that. And they were forcing them. They told you if you were surfing, they arrested you. If you went to a playground, they filled it with sand. They forced everyone in so many cities that if you don’t get it, you lose your job or that you’re going to get fined. And it’s insane. A lot of this is all based on lies. I mean, look, when you have something like this happen and you see different decisions made by what color your state is, red or blue, you know it’s political. And it should never have been political. It’s, you know, you want to know what is going on. You want to—again, it was so big. But some of the decisions that were made—and this guy just loved Grandstanding, you know, this guy loved being, you know, on the front page of everything.

Frank Curzio 04:22

And to see how he denied so much of the stuff that we now know is untrue, it’s pretty crazy. So it is entertaining if you want to watch it. For me, I don’t know how it relates to stocks too much, but it’s entertaining as hell. And this guy deserves to get the beating that he’s getting right now. He really does. I don’t think there’s anyone on any side that doesn’t think that, because your family was impacted because of stuff that he said, and he was said because of politics, of some of that outcome. I mean, we had Dr. Gottlieb. Dr. Gottlieb became the face of COVID. Remember that? And Dr. Gottlieb is on the board of Pfizer, who had the biggest vaccine. And he’s like, “You got to take this.” And the booster—I mean, the boosters. The boosters are the funny thing. You know, government money coming in, coming in, coming in, and all this bullshit. And you’re seeing a lot of the effects that are still being hidden. Look it up, guys. And even doctors have telling me a lot of doctors love trading, love stocks, and it’s great. And, you know, leading doctors run hospitals, and it’s, you know, just look up the statistics.

Frank Curzio 05:11

I know Google tries to hide as much as they can. Look up the statistics right now. Look at some of the things, the side effects that are happening. It’s really, really crazy. And, you know, this guy, to me, gets what he deserves. I can’t picture anybody supporting this guy right now because, you know, just some of the stuff that’s coming out now and what he lied about and how he’s been a big part of this and, you know, Wuhan, how they covered that up and, you know, China, why you’re saying it’s a China virus and all this stuff. I mean, it’s insane what we know now and how that all reflected and how everything went down right in an election year, right? That’s our politicians that don’t give a shit about our kids. It’s more important—power is important to them. Understand that. Play it. Make money in stocks off of it. But just know you can never trust a politician. I don’t know, Daniel, if you want to add to that.

Daniel Creech 05:53

Nope.

Frank Curzio 05:55

So look, a lot of stuff going on today. You got the Fed meeting, right? The market’s getting annihilated, right? We’re down a lot. We’re down 800 points on the Dow. The Dow is down more than the rest of the indices, which is, you know, unusual. You usually see the Nasdaq getting annihilated. I mean, Nasdaq 100 is down a lot too, but you’re seeing a 1.3% down turn in the Nasdaq here. We have lots of earnings coming out. We’re right in the heart of earnings season, right? So this is like one of the biggest weeks. I think 150 out of the 500 companies are reporting earnings. So, and craziness around earnings, right? We’ll talk about that in a minute. Oil rising again. You know, Brent up 7% to $9 a barrel. This was two days ago. Trump announced, and Iran announced, “We have a ceasefire in place,” which is like the 30th ceasefire since it started. And it was like, “Okay, whatever.” And within 12 hours later, we woke up and we have surprise attacks, missile attacks from Iran, after they agreed to ceasefire with the U.S.

Frank Curzio 06:44

And you know how Trump’s going to respond to that. So we know what. We don’t know who’s controlling Iran. It’s, you know, whatever it is that if you’re looking at oil prices are going to stay high for longer. And there’s a lot of money to be made when you’re looking at that trend. So, you know, these are some of the things we’re going to talk about today. And I think we start with the Fed, Daniel. You know, what are you thinking about? Because everyone’s listening to this. The Fed is already going to make the decision, but we’re about, what, an hour and a half, two hours just before that, before that decision. So I like holding us accountable to what we think, because you’re going to know. We could be like, “No, there’s not going to be any rate hike,” or “They’re going to say this or that.” But, you know, you’re going to know whether we’re right or wrong by the time you listen to this. But very big meeting today because everyone in the media is saying largely that they’re expected to keep rates steady.

Frank Curzio 07:31

Yet, you know what the percentage is of the Fed keeping rates on hold? What do you think it is right now going into this meeting? And it changed over the last like four hours.

Daniel Creech 07:41

70, 80%?

Frank Curzio 07:43

64%.

Daniel Creech 07:44

64%?

Frank Curzio 07:44

That is not a guarantee. And very smart people, like the people at Citadel, they’re pretty smart, last I heard. They’re expecting, they’re predicting a surprise 25 basis point rate hike. Now, that’s Citadel. That is pretty smart people. That’s basically, you know, the company you need to have a PhD in math even for them to consider you working there. You have to have, you know, huge experience, AI, automation exposure. They’re some of the biggest circles when it comes to politics and every single industry. Those are the guys that are predicting a rate, a surprise rate hike of 25 basis points when the Fed meets in a little while. Do you agree with that? Or did they put it on hold? What are you seeing?

Daniel Creech 08:19

I think they hold. The thing about the rate hike is, and you can make an argument and looking at interest rates and such that, “Hey, the market thinks the Fed should hike rates, say 25, maybe even half a percentage point.” I don’t think that that happens today. But, and the reason I don’t think that happens is because I do think that Kevin Warsh has enough rope to kind of continue this hold steady idea and see what, if any, of this inflation recent uptick. I mean, I know we had the last month drawdown because of oil. That’s been reversed again. And I just think he has enough rope to kind of say, “Hey, we can see if this is going to be transitory or not.” The only thing that makes me think about a rate hike is because, and Warsh is guilty of this as everybody else, including me, if you wanted to make sure that you were trying to tell the world that you were not just doing the bidding of President Trump and wanting lower interest rates, the thing that does kind of not worry me, but I guess I wouldn’t be overly shocked if they did do some kind of hike because that’s the perfect way to kind of break and show, “Hey, I’m doing what I think is best, going against the noise, ignoring everybody else and all that.” Again, I think it’s too early if he hiked the second meeting and all that.

Daniel Creech 09:36

Really, I don’t even know if he’s—is he going to do a press conference, do you know, today? I’m embarrassed. I don’t even know if he’s holding one today after the meeting. But we’ll see what their statement says. It’ll be very short. But I like the less—this is volatile. Don’t get me wrong. It’s painful with markets and such like that. However, I think that less talk from the Fed is a good thing going forward. We’re kind of—the markets are kind of like a child right now and throwing a little temper tantrum and, you know, because any change is negative a lot of times. But I ultimately think this is a good thing. A quieter Fed will be a lot better. And I will look forward to any statements if he puts them out there. But I think they hold, to answer your question.

Frank Curzio 10:14

Yeah. You know, I’m not sure if I agree that they’re going to hike. Usually, the Fed is more predictive than that. But I think we’re going to get a much more hawkish tone from Warsh and the Fed. You have the 10-year at highest levels in 18 months. Mortgage rates are highest levels in a year. Lots of people having trouble selling their houses. And the market’s really frozen. We were saying it was frozen seven, eight months ago. It’s even worse now. However, you had readings on inflation that showed moderation as of last month, which is, you know, one of the reasons why I don’t think—I don’t see a surprise rate cut because, you know, if they do—I mean, if they do hike rates, I think it’s going to be reversed sometime in 2027. Inflation keeps falling, and it is trending lower now. But I want to explain to you guys how higher rates factor into the stock market because people are wondering, you know, what are you seeing with some of these companies, especially AI momentum days that are reporting very strong earnings and getting freaking annihilated, right?

Frank Curzio 11:05

So why does that happen? So when you look at companies where Google—I thought those earnings were good, and that got nailed. They increased spending because they’re seeing massive demand, which is easy predictable. They got four, five, six, ten-year contracts out, and they’re saying, “We’re going to spend to fulfill this,” which makes sense, but they got punished for it. They also—leaders in AI. So, you know, they’re able to track a lot of this stuff. And, you know, again, they’re pretty good at predicting stuff and knowing that that money is going to come in. So they’re increasing spend. You have GVNova got nailed. Corning got nailed yesterday. Micron, a lot of these companies getting—Skyworks getting nailed. And some of these reports are not that bad. And there’s a good reason for that because when you look, this came out on Monday. And I haven’t seen a lot of people talk about this, but BlackRock sold, you know, that bond offering, $12.5 billion, which is to help Meta, you know, build the huge data center in Texas at a yield of 7.53%.

Frank Curzio 11:51

And that might not mean nothing to you, but that is the highest yield for a blue-chip data center offering since basically the beginning of 2025 when all this stuff went nuts. It’s almost $600 billion that has been raised through AI, you know, in debt for the AI over the past, what, 18, 19 months or so. And this is the highest yield, which means it’s getting more difficult. Now, these companies have massive cash flow, and I get it. It’s not like they’re going to default on this stuff. But if you’re looking at the spread between where U.S. government debt is and this offering, it’s about 2.8 percentage points. It’s the widest margin for a bond rated AR higher in the past three years. That’s according to JP Morgan. So, again, not like these bonds are going to default. Meta’s back in this, and a lot of the hyperscalers are back in this with data center leases that are already signed in more than four years. Rust does that as well. So does CoreWeave. But it does mean that raising money for AI data centers is going to become much harder.

Frank Curzio 12:45

And when you’re throwing in risks like the Chinese models, tokenization limits, what we talked about, like earlier this week, Daniel, a result in many of these companies maybe not generating the ROI that they thought. Again, it’s not going to result in less power, right? Because even if something’s going to be cheaper, you’re going to use it even more. It’s actually going to probably require more power. Massive political risk here from both sides. This isn’t a Democratic thing. It’s a Republican thing too. If you look, I did some research on this. There’s, you know, you have 13 states right now that passed measures to pause all the tax exemptions, subsidies, tax breaks to hyperscalers building these data centers in these states, while another four have similar measures in place that are pending but eventually being enacted. So when you’re looking on a political landscape and what people say, seven out of ten people right now in America are saying, you know, in each of these states, that we don’t want data centers built in our backyard.

Frank Curzio 13:33

And if you’re looking at politicians going into an election year, this is why they’re doing this. So it’s getting harder political on the state level. You know, a lot of people questioning the Chinese models. You throw in, you know, the debt getting harder, and the result is this surge. Don’t want to get too technical here. And CDS spreads, that’s insurance of these companies defaulting. And a lot of, you know, bond investors are buying this insurance, saying, “Hey, you know what? We might see a debt downgrade here,” which could happen because they’re taking all of the money that generates for cash flow, which is tens of billions of dollars, and just reinvesting it to the point where they’re going negative free cash flow. So why are you seeing Oracle get annihilated? SpaceX is down to $111, meaning anyone that bought that stock is down tremendously now. I mean, you couldn’t buy it for, I think, less than—what did it come out at? At $160, I think it was? You know, when it first opened and went to, what, $225 briefly, like over $200.

Frank Curzio 14:25

But I mean, this is a stock that’s just gotten annihilated. And holy cow, man, when you really look at this thing, I mean, it’s, you know, again, I don’t even think—let me see, $160, I think you were able to buy at. And now you’ve gotten annihilated because of this, because of the debt. And what does that say for Anthropic coming out, Daniel? What does that say for OpenAI coming out with this trillion-dollar valuation? But the collapse is presenting an opportunity because, again, models become cheaper. It’s going to result in even more power. You have Morgan Stanley come out with a 118-page report. We have access to all the stuff. I’d like to share some of this. And they’re predicting that we’re going to have a 38-gigawatt shortfall of power that’s needed between 2026 and 2028. Now, that’s just a number to you. What the hell does that mean? We’re expecting, and what we need is 68 gigawatts of power through 2028. There’s going to be a 38-gigawatt shortfall. That means we’re coming 55% short.

Frank Curzio 15:16

We told you that there’s going to be blackouts. We told you that there’s not enough power. So the opportunity here, when I look, is companies like Vivo, companies like that have pulled back significantly. Again, we’re in. We’re still up a lot on it because we recommended this company, you know, early, that as well as DigiPower, right? DGXX. They own their power, and there’s less power being available to come online. A lot of these—60% of these projects that have been delayed that we hear have great contacts in a data center space. So the spending is continuing. You’re seeing $700 billion annually that’s going to be spent from these companies. Our job is to figure out where exactly is that going. And you’re seeing a lot of these companies re-rate because there probably is going to be a slowdown in spending that’s taking place as it would take place when nature takes care of itself. It’s almost like it’s automatically taking care of itself. When you have politics, you’re shutting down, saying, you know, states aren’t going to provide the subsidies.

Frank Curzio 16:03

You don’t have enough power there, right? So, you know, you have these risks where debt is getting much more expensive, right? So you’re not going to raise as much debt, which means if you’re not raising as much debt, you’re not going to be able to take that money and build faster. So you’re going to see a slowdown. That’s what’s taking place, and these things are getting re-rated. But when I look at these power companies and, you know, blackouts are coming, there’s just so many names. You see Bloom Energy? Daniel, put your Bloom Energy really quick. Before we go further, Savvy is a vacation rental disruptor. So you might remember my interview with CEO Eric Goldrier. And this is a person that had two huge exits in the vacation rental space, bedandbreakfast.com and Turkey Vacation Rentals, and has been in this industry for over 30 years before Airbnb and Vrbo even existed. Now he’s come off the sidelines to create Savvy. And this is after he booked a trip for his family through another vacation rental platform and getting blindsided by the huge markups and fees.

Frank Curzio 16:53

You know exactly what he’s talking about. Now at Savvy, it’s an online direct booking marketplace without those massive fees, where travelers save on average $500 with professional hosts dealing exactly with them and exclusively with them on every single listing. And the best part about savvy.com is when you book your vacation rental, you’re going to see these savings in real-time as you’ll see the exact same listings on competitor sites and the discount you’ll get from booking through Savvy. So if you’re going to go on vacation this summer with the family, check out savvy.com. And when you book, use the link savvy.com/wsu. That’s S-A-V-V-Y dot C-O-M backslash W-S-U, which stands for Wall Street Unplugged, which will get you an additional $50 in savings when you book. Think about it. What would you do with an extra $500 when you’re on vacation? Not to go on too much about this, but Bloom Energy is one of the few companies. Their earnings were one of the best earnings that you’ll see this whole entire earnings season was Bloom Energy.

Frank Curzio 17:46

And it’s down. This is a company that we sold 10X over 1,000% gains, pretty close to that. And we sold at the right time. I think it was like two high twos or maybe three, whatever it was. Don’t quote me on it, but very, very good. We recommended the stock, I think, you know, in what was it, Daniel? Do you remember? I don’t know. Like the 30s or something, whatever it was. And this company has pulled back, but this is one of the companies that actually have the power that could scale, and they’re getting massive contracts. Where you’re seeing SMR companies, they’re not getting that, right? So, you know, you don’t know if they’re going to be able to scale yet. So you have Bloom Energy. Companies that have access to power now are in huge, huge demand. So when you’re seeing a pullback, what do I invest in? These are some of the names you invest in, but a lot of this is getting re-rated. I’m going to be looking at Bloom. I’m looking at Amazon. I know Amazon is going to report pretty soon. You got, what, Meta and Microsoft, I think, Joe, they’re reporting after the bell today.

Frank Curzio 18:36

You know, there’s a couple hyperscalers that I like. Amazon has, I think, the most access to power compared to and locked in more power than I think almost all the other hyperscalers. And what are we seeing? These companies report, no matter what the hell they report, they’re getting annihilated. They’re getting killed, right? So for me, you know, know the trend, understand what’s going on under the hood, which you just explained within the debt market, why these things are getting nailed. And that’s how come when they’re increasing spending, people think they’re not going to be able to increase spending as much because they might get debt downgrades. But this is what’s going on, where it’s providing this great opportunity, and you’re seeing a lot of this with the underlying market getting nailed. And man, you know, you’re seeing in Bloom Energy, I cannot believe this company’s gotten hit as much as it has where Best Core, I don’t know if Sandisk reported or just put out numbers, but Sandisk’s numbers were insane. But you’re looking at these hyperscalers.

Frank Curzio 19:24

They are generating high ROI on their CapEx investments. They know exactly what they’re doing. There is going to be opportunities here. Be a little patient. But right now, this part of the market’s really getting smoked.

Daniel Creech 19:34

Yeah. I mean, everybody is kind of getting thrown out, or the volatility is kind of impacting everybody. Quickly on, for me, Corning even came up. If you could pull that up, Joe. I like Corning, and I wouldn’t run out and chase this. I’m glad I held off on recommending it because it has really pulled back if you pull up a couple months chart. But the growth and stuff is still there. And really, when I was reading through their report, there were no big red flags that I saw. They were putting up impressive growth, 65% for their enterprise networks, hyperscaler, AI data center deployments. And they’re growing very solidly. And the only kind of comments I could see, Frank, is, well, it just kind of comes back to this. We don’t know if margins are going to pick up or when is all this CapEx because they’re increasing CapEx too. Hey, when is that going to translate into more earnings just from AI?

Daniel Creech 20:36

And like I said, you know, it can be painful. I’m glad we’re not in this one, but Corning is definitely one that has my attention now that it’s pulled back. I’m going to continue to go through that earnings report. And then one more for me, Joe, STM. These guys, I’ve talked about these guys in the past as well. This was STM is Microelectronics. And they have different segments. So it’s not just a pure-play AI data center. So I can understand their stock falling because, you know, automotive is kind of lagging, although it’s picking back up. But everybody that still has any pulse or hand iron in the fire on this AI is still seeing tremendous growth. And so, like I said, it’s painful to watch these pull back, especially if you own them. But as Frank said, man, when you’re taking a fresh look at these, again, do not rush out and buy this today. However, these stocks pulling back are creating an opportunity because GLW and STM are in the right trends, and they are profiting from it. So these aren’t, I mean, they’re growth stories, but they’re not growth waiting on income or earnings or anything.

Daniel Creech 21:39

But again, as Frank said, it doesn’t matter what you report right now. You’re growing 30, 50, 60, 70%, and markets are hitting you down double digits. So just, you know, respect the market and don’t try to catch a falling knife because that’s just foolish.

Frank Curzio 21:54

I mean, you look at them, this is, if you look at the month, right, for Corning in a month, the S&P 500 is flat, and this stock’s down 44%. I mean.

Daniel Creech 22:04

Yeah, that’s nasty.

Frank Curzio 22:05

I mean, what’s the market cap of this company, Joe? I mean, you lost $100 billion in market cap, like in a month. Like, holy cow. So also what’s coming out is you’re seeing a lot of reports from Goldman Sachs and Morgan Stanley. Again, we have access to a lot of this research. When you’re looking at the size of the S&P 500 and how much it’s grown, where we have trillion-dollar market cap companies, Apple, congratulations, breached the $5 trillion mark, which just to put that in perspective, that’s bigger than the GDP of every single country except for the US and China, which is freaking insane, right? And you have Nvidia up there. You have a lot of these hyperscalers up there. So now what happens is you’re having a massive amount of leverage, right? So as this comes into, you know, like $20, $30, $40 trillion market, you know, that leverage building up. And then when you throw in computerized systems, when you throw in AI, when the money shifts around so quickly, the massive amount of money that’s just pushing around this market.

Frank Curzio 22:56

And remember, we say this all the time. It’s not like money’s leaving the market. It shifts. Why? Because all these money managers, they have to put into something. If they don’t, you’re not going to pay their fees. And that’s what everything relies on, right? It’s all about money. That’s Wall Street. That’s why every retail investor gets fucked. You get sold all the garbage from Wall Street, and the SEC doesn’t do anything ever, right? We always see that all the time. But you’re seeing this money, where is it going, right? So that’s our job to figure out where is it, where is the allocation going to go? And you’re seeing it pour out of AI. Where is it going? Because when you look at the market overall, let me see this really quick, Joe. So the last, I want to say maybe the last three months, I’m going to see if I can punch this up. Okay, give me a second here, guys. I’m going to look at the Nasdaq. Let’s look at the Nasdaq 100 and see if we could see this over the last three months. No, but less than that.

Frank Curzio 23:42

Let’s go to last month. All right, the last month we’re looking at this, and that is really July. And I just want to see the comparison to the overall market. All right, so you’re looking at the Nasdaq. You don’t see this often. The Nasdaq 100 is down 8.3%, while the rest of the market is down 1%. So you may look at your portfolios because anyone that’s made a lot of money in the past 18 months had to be in AI, had to be in momentum names. And I get it, right? And a lot of us were in there very, very early if you listened to us. And, you know, again, we’re taking some of the hits. Not as bad. We sold a lot of stuff out of our portfolio. But when you’re looking at the overall market, look at Coca-Cola. I mean, look at Coke right now. Okay, this is, Coke’s at an all-time high. And margins have increased. And how they increase by Coke doing what Coke does, they’re going to shrink the product size while increasing prices. Again, we’re looking at 20 consecutive quarters where Coca-Cola has increased their prices.

Frank Curzio 24:36

Daniel, you should know that, right? You love Diet Coke, right? I love Diet Coke too. I love Diet Coke. When you look at Coca-Cola, and you have pricing power. I’m not beating them up or whatever, but what restaurants are charging for fountain soda is an absolute joke. I mean, it’s like $4 now for, you know, minimum, minimum for a fountain soda. And you might get lucky at LongHorn because they’ll refill it once for you. But it’s every place you go, and that’s what they’re doing. They’re raising those prices. And, you know, so Coca-Cola is able to do that in the past five consecutive years. Not five years in a row of raising prices. Quarter after quarter after quarter after quarter, and now shrinking product size. Again, this is what good companies do. They know how to maintain their profits, and people are still falling for it. Say, okay, I’m fine. I’m going to pay $4, $5 for Coke. I don’t care. Maybe that stops sometimes because it stops with a lot of other names, and you see those names get crushed.

Frank Curzio 25:25

It stops with Nike, right? So people are like, all right, we don’t want to pay $180 for your sneaker when we have other ones that are just as good and even better at so many other brands. And look where Nike is. I mean, man, put up a five-year chart of Nike. It’s sales for China. Remember China was their biggest growth market. We talked about this in 2000, 2001, 2002, where the growth market just, you know, China was their massive growth market, and it’s down 30%, I think, sales year over year. Just total annihilation of Nike. But Coke is at its all-time high. You’re looking at, and look at the quarter. Did you see the quarter, Daniel, that Coke reported?

Daniel Creech 25:59

I did, no.

Frank Curzio 26:00

So Coke reported earnings, right? They beep by 4 cents, 97 cents compared to 93 cents. They guided revenue in line. Stock pops to all-time highs. If you take KO and take that symbol out and throw any AI symbol in there with those same results, the stock’s down 15%. It’s amazing. I mean, you’re looking at a small beat, margins higher. That goes in the earnings beat. Guided revenue in line. You’re talking about Corning. You’re talking about, you know, a lot of companies that have done that and have gotten annihilated in AI. So, you know, you’re looking at other names. Look at Philip Morris at an all-time high. Monster Beverage at an all-time high. Altria, best level since 2017. If you look at healthcare, you’re looking at AbbVie, Labcorp, Jazz Pharma, Amgen at all-time highs. J&J at an all-time high. Put up J&J. I mean, we’ve been talking about this stock for a while. I’m pissed it’s not in the portfolio because, you know, they turned the corner. This is a stock 12, 13 years. I have a very good friend that works at the company, and it’s just, you know, it’s been such a long time with J&J.

Frank Curzio 27:02

I feel like they had that Microsoft moment for like that lost decade between there. And, you know, a lot of it too, they’re getting a nice bump from what? Because they settled the baby paddle litigation, which for $5 billion. Well, not settled, but proposed, and defense is accepting it because that’s a nice check for them as well. And saying that it contained asbestos, baby powder for all those years. But if you look, put up a five-year chart of J&J. Look at that. That’s disgusting. Before July, look at it. Look, it’s flat garbage. If you pull up all and go, I mean, it’s even longer than that where you go into it. So now push it to like 10 years, Joe, if you can. Again, we use CNBC. We got to use different charts and stuff like that. I just use it. I like to use things that where people could follow along. But anyway, you know, the five-year chart, go back to the five-year, you see it a lot better. But this is a stock that has done nothing, right, until recently. And then boom, it’s gone.

Frank Curzio 27:50

And, you know, of course, you know, J&J with the $5 billion lawsuit. Listen, you know, they settled and admit no wrongdoing. You know, it’s kind of like, you know, the Michael Jackson thing. I didn’t do anything, but, you know, they pay the channelist, whatever, $24 million to settle the sexual abuse claims, which is sad because the church victims, what did they get? They got like $5,000 each. Damn. Insane. Anyway, in the stock market side, I want to go on a freaking rant there. In the stock market, when you look at big settlements, it’s very, very good news for large-cap companies from a stock perspective because it’s great because it removes the uncertainty where you don’t know how much they’re going to pay. They’re going to continue to go for a long time. So you had this move in J&J because their earnings have finally, finally bottomed out. Their pipeline’s freaking great. Finally on all cylinders. Now they have this settlement saying, okay, this is mostly behind us. And the fact that defense said, hey, it’s a really good settlement.

Frank Curzio 28:39

They’re probably going to accept it. Whenever you see that for large-cap companies, S&P 500, Philip Morris, whatever it is, Chipotle when, you know, again, they had the food poison and stuff like that. So whenever you see them settle and get that out of the way, the stock usually pops tremendously because it removes uncertainty. But J&J is on fire. If you’re looking at Rostars and Burlington, those are those resellers, right? They take everyone’s inventory and, you know, sell it a lot cheaper. Makes great margins. All-time highs. JP Morgan at an all-time high. That’s amazing to me. And, you know, who else at an all-time high? Apple. Daniel, Apple, your favorite company in the world at an all-time high. So when I look at Apple hit the $5 trillion market cap level for the first time in history at a time when Tim Cook will make his final earnings call as the head of the company coming up, I think, when do they report this week, Joe? How is he not on the Mount Rushmore of all-time CEOs? I’m not talking about if you have anything personally against him or with politics.

Frank Curzio 29:38

I’m talking about results as a CEO. All right, he came into a company that Steve Jobs saw that Steve Jobs, listen, I think Steve Jobs, I don’t think this company is even close to where it is if Steve Jobs was still at the helm of this and then passed away because he didn’t believe in partnerships. He didn’t believe in a lot of stuff, right? And, you know, again, we know going back and stuff. Again, I don’t want to triple anyone’s grave, but he was a nice person at all. But it’s the deals that he’s done. I mean, when I go over this with you, listen to this. So you’re looking at a chart, Joe, if you could pull that up right there. And this is when he took the helm around mid-2011. You look at the S&P 500 since then, up 548%. Apple is up 2,743%. He launched the Apple Watch, the AirPods. He scaled his services division, which was massive. Now generates $80 billion annually. Yes, that cloud that you pay for all the time and all the services you pay for all the time is automatic charge. $80 billion annually.

Frank Curzio 30:38

Annually. Okay, that would be enough in a company by itself to be in a top 10, top 12 of companies in the S&P 500 right now. And then you’re looking at making his own processors, saying Intel is in your piece of shit. You guys haven’t invented anything for a long time and said, we’re not going to deal with you guys anymore, which optimized the battery longevity, which created vertical integration between their entire ecosystem. He mastered the supply chain. Think about selling 100 million products every year, right? And all these iPhones, all these devices, and everything. And you’re able to master those supply chains, which is incredible. It’s incredible when it comes to inventory. How much inventory, you know, how difficult that is to figure that out. Is this iPhone going to be the one that a lot of people upgrade? Maybe it’s just 10, 12% of people. It’s going to be 15%, 17%. It’s tens of millions of more devices. Signing all these deals with Taiwan Semi, making sure you have those supplies, which really killed the car companies back in COVID when we saw massive supply constraints because car companies never operated like that.

Frank Curzio 31:37

They operated like a couple months before, and they tried to call Taiwan Semi and said, okay, we need more chips for cars. Like, sorry, we’re out of capacity. Talk to Apple. You know, so, yeah, this guy is ahead of everything. Not spending all the cash flow it generates on AI data centers, which I ripped them for. Everybody ripped them for. They were behind. You’re supposed to have Apple Intelligence, which, you know, they lied about, and they got, you know, again, it’s a billion dollars, which is like, you know, me, you take out a penny out of our pocket. Not a big deal. But you’re looking at, look at the buybacks that people criticize. Do you know how much, I don’t even know if you want to guess this. Do you know, I actually looked this up. Do you know how much this company has bought back in stock since he’s been at the helm in 2011?

Daniel Creech 32:18

No, but it’s got to be an astronomical number.

Frank Curzio 32:20

$850 billion in buybacks. Okay, you put that in perspective. There’s only 14 companies with a market cap greater than that in the S&P 500. That’s how much free cash flow they generated and bought back their stock. So they cut the shares by 40% outstanding, which contributed to this massive earnings, right? So if you’re cutting the shares outstanding, if you generate the same exact earnings, so say the same net income, save you the same net income, it’s whatever, it’s $100 million, and you have less shares outstanding, you could have the same exact number, not seeing that income grow, but your earnings per share is going to grow because the share count goes lower, which is key for these companies. And a lot of people say, well, they do that this way. The earnings go higher because their pay packages are based on it, whatever it is. I don’t care what you think, but the guy bought back $850 billion in stocks with the stock at an all-time high is a great freaking decision, no matter what, right?

Frank Curzio 33:13

So you’re looking at that alone, along with everything else he contributed, you’re looking at a company over his tenure that increased earnings by average of just about 30% annually for the past 13 years he’s been at the helm.

Daniel Creech 33:25

Man.

Frank Curzio 33:25

So when I look at this guy, how is he not on Mount Rushmore? And maybe you have your own opinion about it. Send it to me. I posted this on my X account at Frank Curzio. Let me know who else is on there or the people that deserve to be ahead of him. But holy cow. I mean, on the day that he’s basically leaving, stock goes through the $5 trillion market cap all-time high. Listen, you know, for Apple investors, good for you if you own this stock the whole entire time. Really incredible. We’ve traded this company in and out. I felt like this is one of the names that we’ve done very well on trading in and out. I can’t say that for all the names, but this one we’ve done well. But man, what a great return and great job by him. I mean, seriously, I don’t know how anyone could rip this guy apart. Again, not politics, not personals.

Daniel Creech 34:07

Are people ripping you apart? I mean.

Frank Curzio 34:09

No, no, I just say, but you know, politics sometimes. But you have to play politics, and he’s very good at it. He’s very good at whether it’s the Biden administration, whether it’s a Trump administration. You need to have your politics in order. If you don’t, you’re going to have this huge headwind against you, which could crush you with tariffs or whatever. You know, so him working with Trump and bringing more, you know, again, is it the best thing for his margins? No, but it’s smart because you’re on the right side, right? You got to be on the right side of politics no matter who’s in there, no matter whose company it is. And the best example of that is Larry Fink with BlackRock, who basically is the one that created all these companies to have their whole environmental ESG ratings, all the stuff in presentations, which we’ve never seen in history. And all of a sudden, you know, Biden got elected and all this environmental, you have to have this, or they get to get fined, all this stuff. And he’s like, this is the biggest initiative we could ever see in our country’s history.

Frank Curzio 34:58

And as soon as Trump got elected, he’s like, we don’t need this shit anymore. It’s freaking great. That’s what companies do. I’m not making fun of him because you have to play politics when you’re a big company. You have to, especially when you control 15 trillion assets and you’re the biggest investor on almost every single company in the S&P 500. So, you know, very, very smart, very sharp. And he knew how to play politics. And I don’t know if you could say that about if Steve Jobs is around in terms of playing politics because some people just don’t have it. I don’t like to play politics. A lot of people don’t. As a CEO, you need to understand the politics, and he’s done a great job on that. So yeah, I haven’t seen him getting too much shit on this, but you know, I mean, overall, holy cow, what else could you ask for out of a CEO if you were an investor in this company? What else could you ask for? What else could you ask for?

Daniel Creech 35:42

Yeah, I wasn’t, I wasn’t, I didn’t know all the stats you were rattling off. The one thing I’ll say about Mr. Cook and that I thought was so impressive back when he did it was when they were buying back a lot of stock, when interest rates were very low, they were taking out debt to buy back their stock. Because of their cash flows, they could finance that. But the bigger thing there, I mean, that was clearly a very smart and great financial move. And it was a way to adapt to very ignorant policies from politicians because when you depress interest rates and you, you know, basically you tinker with them in a negative way, and you had such low rates for so long after the financial crisis, it made companies do different things because you weren’t earning anything on your cash. Now, fast forward today, obviously, interest rates are higher. You take out debt, you pay a higher interest rate, and you can also use some of that money like Apple.

Frank Curzio 36:37

You got to get a TV.

Daniel Creech 36:39

Bills and you weren’t a competitive retail for a long time. I just, when he was buying back stock, taking out debt to buy back stock, I do remember him getting some, making some headlines and getting some critics there, but I thought that was genius. It was a great way to adapt from a macro environment. So yeah, hat tip to, I knew he was leaving. I didn’t realize he was about out the door now, but good for Mr. Cook.

Frank Curzio 37:01

Yeah, no, really great stuff. So again, the point is you’re not seeing all these companies where everything is getting nailed. It’s mostly the momentum trade, which a lot of people generate huge returns. Again, we went in at, whatever, it was 30 bucks at BE, and it went to, you know, 300, over 300, you know, which is incredible gain for whatever, less than two years, 18 months, whatever we were in it. And a lot of this unwinds a little bit. So, you know, but it’s not everything going down. It’s money moving to different areas. And when you’re looking at oil, one of the biggest trends within oil is offshore drilling. It’s a lot cheaper. Look at offshore Africa. Massive. If you listen to all these calls of all the services companies, we have TechNip, we’re up 200 and whatever, 30, 40, 50% on that stock. You listen to Halliburton, you listen to all the services companies. Ocean Engineering Reporter just talked about it. I mean, just the amount of companies, the amount of money that they’re spending, the majors, just to drill there because that’s one of the most unexplored areas where you could find multi-billion barrel discoveries, and they have.

Frank Curzio 37:56

And the politics are much, much better. These guys already figured it out, believe me. If Exxon, Petrobras, Total, Chevron, if they’re all drilling this area, they’ve been doing this for 100 years, right? They know the risks. They’ve got screwed from geopolitical risks and different governments. They understand this risk. But right now, you’re seeing all politics within Africa, they’re all opening up because it’s a win-win for everyone. And man, they are staking claims like crazy. We have companies in there. One of them is Blue Energy. One of the companies we work with, that’s tremendous. They just raised money because, you know, I think they’re sitting on a massive fine. That’s why Total actually came in and took 65%. You know, they have a partnership with them. So to drill the area that they staked a couple of years ago, and now you have Petrobras buy them, you have all these companies buy them, just a lot of different trends going on that make sense. And oil prices, I think we all know, Daniel, right? They’re going to stay higher for longer.

Frank Curzio 38:42

I don’t see this stuff ending anytime soon. Maybe we see, you know, come down to, you know, 75, 70, but still, you’re going to see anything over 70 is going to be very, very good for these companies, and they probably go a lot higher on this news. So, you know, I’m looking at that with Ford. Did you see Ford’s results? Ford, I thought it was interesting.

Daniel Creech 38:58

Ford popped, I saw.

Frank Curzio 38:59

Where’s Ford? Let me see. So Ford is, it’s up 3%. I mean, the market is pulling back significantly right now ahead of the meeting. That’s not bad. $15. Put up like a year chart and then a five-year chart. So yeah, so is there, I didn’t even know it went up that high to 17 in June. This is a company we haven’t been favorable about until the day they said, hey, and this is what, a year and a half, two years ago? All right, we’re not going to put the 50 billion into EVs like we said we were going to do when we were so late to the freaking party. Good for them. But this is a company that, you know, they report on EBIT, it’s called, so earnings before interest and taxes. So that’s how they report their numbers. And they raised that from $9 billion to $10.5 billion in guidance. They increased their free cash flow guidance by a billion dollars, $6.5 billion. This was a great report, followed by what? Followed by GM, who also reported a great report. So these guys are doing what? They’re scaling back EVs.

Frank Curzio 39:55

You look at strong sales for trucks, SUVs, hybrids, right? They’re making a shitload of money on these things. Their margins are incredible. People are still buying cars. It’s great. Thank God they got an EV market. Did you see the EV numbers that they reported?

Daniel Creech 40:07

No.

Frank Curzio 40:08

Revenue fell 50.

Daniel Creech 40:09

I don’t have it looked at Ford.

Frank Curzio 40:10

56% year over year. Great.

Daniel Creech 40:13

Well, for Ford or GM?

Frank Curzio 40:14

For Ford.

Daniel Creech 40:14

Oh.

Frank Curzio 40:15

Great, right? It’s what you want to see because they can’t make money, they can’t scale, they can’t be like Elon Musk, right? So they weren’t able to do that, and they were so late to the party. Now it’s amazing because remember they’re like, EVs are the greatest thing. It’s awesome. We’re all in it. Our technology is the best. And now they realize, holy shit, we got to get out of this. And they ran out of it. And good, you made the right decision. Instead of keep going, we’ve seen that for two, three years, like, get out of it. You guys cannot compete. Sure enough, they did that. That’s when I was like, all right, Ford, GM makes a lot of sense, you know? So thank God they got out of that market. Gross margin is very, very strong, and, you know, they’re killing it right now. These are really, really solid numbers. I couldn’t find anything bad about this quarter, and I think Ford could be out of its way to $20 a share. You know, same with GM. GM, I think it was at an all-time. Put up GM. Isn’t GM like at an all-time high or something? They reported great numbers, I think it was a week ago. Same thing. These guys have figured it out.

Frank Curzio 41:01

Cost controls, 91. Put up at all-time. Yeah, this is all, yeah, another company at a record in a market that’s getting annihilated, and everyone thinks it’s down so much more than it is because a lot of you have exposure to hyperscalers. You needed exposure to the momentum names over the past 18 months, or you didn’t outperform the markets. You were significantly underperforming the markets. You got punished. Now you’re getting punished for owning these names, no matter what they report, and that’s the shift that we’re seeing. So, you know, we’ve shifted a lot within our portfolio. We have a lot of dry powder. We’re looking at so many freaking, I think Netflix has finally bottomed 66, 67, it’s over 70 now. I think Oracle is going to hit a bottom pretty soon. A lot of these names have gotten nailed before everything else. McDonald’s as well. If you’re seeing, you know, companies like, you know, we talked about earlier, like, you know, some of the retailers, the resellers, you know, TJ Maxx is killing it, the, you know, the raw stores and stuff like that.

Frank Curzio 41:51

I mean, these are companies that do well, not that we’re in a recessionary environment, but we’re in a cost-conscious environment, and McDonald’s should be one of them. I mean, you know, you’re going to pay $55 for two meals at Chipotle when you could buy, you could probably get like 700 chicken nuggets for that, right? So, I mean, what do you want to eat? So, and it matters to people, right? It matters because people are struggling. All that costs are up right now. So, you know, when I look at these numbers with Ford, good for them, amazing numbers, and not everything is getting killed, right? Not that you think by looking at the markets and looking at some of the names that everyone talks about all the time, because no one’s really talking about the names that are doing really good right now, like, you know, outside of Apple. But no one’s saying, oh, LabCorp, all-time high, Jazz Pharma, Amgen, Altria, Monster Beverage, Philip Morris, who the hell was those? Those like shitty companies owned for such a long time, not anymore.

Frank Curzio 42:37

And a lot of them pay really, really good dividends. And look at McDonald’s, just this total, you know, again, GLP-1s probably a part of this as well, and that’s not going to change. And, you know, but I think a lot of this is reflected in this stock price of McDonald’s. And let’s see. Let’s see what happens with a lot of these names. But not everything is getting killed this. Some stuff is working. Oil, healthcare, biotech is working as well. Some individual names that we like. But you’re going to see a lot of these names make them into our alpha portfolio pretty soon. So I don’t know if you wanted to follow up or anything else that you’re looking at in terms of earnings, Daniel.

Daniel Creech 43:06

No, that’s a good list on all-time highs though. That’s a good list.

Frank Curzio 43:09

Yeah, it is pretty cool. So listen, guys, we, I talked about this company a lot, right? They were at our conference, our Kersey One conference, and this is Sugarphina. So if you ever went to a nice store, it’s high-end gummies, candy, you know, these guys have been following for a very long time. You know, run by Scott Laporter, one of the best roll-up CEOs in the world. And you have Paul Kessler, who’s a friend of mine, who’s kind of a mentor. It’s funny because I’m kind of mentoring his son in stock investing and stuff, but he’s established and created and financed about 400 companies. He just created a SPAC that raised $200 million in a day. Makes me feel like you’re in a different league sometimes when you talk to some people. And they’re behind this. And they bought this company in 2019 and got wrecked because of COVID, and now it’s on fire. And we invest in this company at an 80 million valuation for one members. One members is my special, when we invest in private placements, that’s a special membership.

Frank Curzio 44:08

You pay for the membership, and then you get to invest alongside me in all the names I invest in. And, you know, I don’t get paid by these companies, and you could choose which companies you want to invest in once you’re in the membership. It’s up to you. I interview the CEOs. They also interview them on stage at my conference, at Kersey One, which is in October. So we have a list of one members that I vet these deals and go over the terms and make sure that they’re very good terms. Because we have good companies and good offerings, you know, they say, hey, we’re raising money, but the terms are really shitty. It’s my job to go through. So you know that if you’re investing and this doesn’t work out, I’m going to probably lose a lot more money than you. And that membership has really been taking off for us. Now, Sugarphina, we raise money. We help them raise. I think we raised $4 million the first time around for them. And the company has taken over three companies. We invested $80 million valuation. And actually, I think it might have been even below that $80 million valuation.

Frank Curzio 44:57

And now it’s, I think it’s less than 18 months later, it’s near $150 million valuation. They were going to go public, and there’s a reason why. They’re saying, hey, we want to raise one more round. They got a couple more companies on schedule that they want to acquire before they go public. Plus, they have a SPAC out there that could, if it’s big enough, that SPAC could come in and acquire this company because that’s what they’re looking for in this industry. But when they started this company, I went to Vegas to see their whole facility. I met Scott. If you don’t know Scott Laporter, Scott is behind, you know, the Hilton brands too. He turned out from $500 to $5 billion where he, you know, Hilton was really struggling in the early 2000s, and he decided to go out there, and they bought casinos, and he spun off the casinos. Again, what he does is buys stuff very, very cheap, roll it into a big brand, and then generates massive profits. And when they came to me like three years ago and talked to me about this, Paul Kessler’s been in this industry forever, and he said, private equity is fucked.

Frank Curzio 45:50

He goes, they’re in a lot of trouble. I’m like, what are you talking about, right? This is three years ago. And he said, they’re in trouble. They can’t unload any of these companies. They bought a lot of them. They’re on the balance sheets. They can’t re-rate them because they got to mark-to-market them. They don’t want to show that on the balance sheet. So now, what are you seeing? You’re seeing these guys stuck with these companies. They purchased companies. They promised the CEO and said, hey, you know what? We’re going to expand. We’re going to invest in you, increase your capex, and they’re not doing that. So these companies are sitting on the balance sheets, and everyone’s asking for redemptions because they’re supposed to go public within seven to ten years. So when they talked about this company with me, I’m like, really confectionery? I was like, consumer-related? I’m like, oh, it’s like, he’s like, that’s what we want to invest in because when these guys are dumping stuff, we’ll be able to buy $0.10 cents at a dollar, and we’re going to be able to turn these companies around. And every single company that he’s done that with, he’s basically spending $1.

Frank Curzio 46:36

For every dollar he spends, he generates over $3, $4, right? For every investment. Every single deal that he does is a creative. And they have a massive list of companies that people are dying to get off the balance sheets because these private equity companies need to have dry powder, and they can’t. There’s tons of asking for redemptions. That’s why they stopped redemptions. So you have this market that he knew was going to happen three years ago, and I was fascinated by, and that’s why he actually started the SPAC. Both of them have a SPAC. They haven’t bought the company. When you have a SPAC, you can’t identify the company. You raise money. You raise $200 million in a day. Not to buy Sugarphina, but Sugarphina is growing so fast that maybe it could happen. And that’s my opinion through this. So I interviewed both of them. They’re raising money again because they have several acquisitions I didn’t want to take over before they go public. And they’re going to go public next year. I would give it an 80% chance, maybe higher. They already picked out a symbol, right?

Frank Curzio 47:23

So you’re looking at Paul as the biggest investor in his company, I think over $22, $23 million. And along with Scott, they’re incentivized to make this go public. You’re looking at the terms of this deal, some of the best terms I’ve seen in any deal. And that’s why I present it to my investors again. Again, I was in the first round. I’m going to be in this round as well. And I just interviewed them for 35 minutes, 40 minutes, unbelievable. I went over my analysis and everything, and it was fantastic. You’re going to understand why they’re doing this, where they’re going. It’s just, they’re growing like a weed. Everything is great with them. So many companies to choose to buy. They’re very picky, frugal. They’re like, you know, they’re not going to overpay for anything right now. They don’t need to. They’re in a great position. So they’re looking to raise more money. In this deal, you get five-year warrants that are exercisable at the same price that you’re investing in. Think about that.

Frank Curzio 48:11

If you know anything about warrants when you invest in them, usually invest in a company and say if you do, the mining company does a private placement at $2, they say, okay, we’re going to give you five-year warrants and three-year warrants, and they’re exercisable at $2.75 or $3 at a premium. This isn’t a premium. You’re getting those warrants at the same price you’re investing, which is fantastic. You almost never see that. Another thing is you get a 6% yield that’s paid in stock annually. And you’re looking at this deal, of course, because I know them, I pushed a little harder and said, hey, how about you give them like this special candy box and stuff, which is like $200 for investors that come in and everything. So they presented at my conference last year to give away free candy to everyone. Everyone loved them. They stayed the whole conference. Everyone got to meet Scott. Everyone got to meet Paul. Answered all the questions. Fantastic. I love working with these guys, but they showed the results.

Frank Curzio 48:58

Were up a lot on investment from the first round. Now they’re doing it again. This is a company I see at a $400, $500 million minimum valuation. They’re talking about we want to grow this to a billion-dollar company, which is a massive win for us, but they’re raising money at this price again. This is just one of the deals we offer our one members. So if you came in as an alpha member recently, because we combined all of our products together to offer you a much better service, right? Which is awesome, right? This way you’re not paying for six, seven different services. It’s one price that’s much lower than owning all these products together. But if you pay there and you’re a credit investor and you think about coming to One, we would take off the full amount that you came in to the alpha membership, and then you become a member of One, and you get access to alpha as long as you’re a member of One. We have our conference in October where we still have room left, not a lot of room. And, you know, it was one of the greatest things we did last year, our first conference at Pier 66, which was an unbelievable venue, especially in October.

Frank Curzio 49:52

I mean, you’re looking at Hilton. They actually stay at this hotel. They don’t even own it. They say it’s one of the nice hotels that they’ve seen. That’s how beautiful it is after they redid it. It was unbelievable. It was just beautiful pools, beautiful spa. Again, it is floored in Fort Lauderdale, which is cool, which is probably one stop from almost anywhere you are, which is really cool. And all these CEOs of our private companies are going to be there. Caffe is another one, which removes caffeine and it’s a simple process. They’re going to have a big taste test. We make this, you know, event really entertaining. I interview everyone. I just don’t let them go on stage and go to a presentation and bore the hell at you. I’ve been to a million conferences before. But this is one that’s on our list now. We have another one, an AI company that’s focusing on dairy and farms, which went from $400, generated $400,000 nine months ago, and it’s over $10 million now. Okay, that’s how fast they’re growing.

Frank Curzio 50:39

Unbelievable company. I just talked to the CEO. That’s going to be the next one that comes out. If you guys are interested in One, private investments, I know everyone wants to get you into private stuff and stuff, and this is the greatest thing. I’m telling you, it’s the worst thing ever. You need someone to look at these deals. You need someone that’s investing that has stake in these deals because the terms of these, especially with SPACs, are horrible sometimes. You want to make sure that the terms are favorable. You’re investing in the right people, people that have been there, done that, like these guys. This is one of those companies we’ve been investing in, I’d say the last six or seven deals, fantastic companies. I’m so excited to invest in all of them. And it’s really nice to be in these deals, especially, Daniel, when you see the market just like blow up like this sometimes. It’s nice to be in a lot of these deals that are raising money, that are doing good, that are growing in the private market, that are going to go public, which usually takes seven to ten years. This company is likely to go public in a year, and that’s your payback period with five-year warrants, 6% dividend.

Frank Curzio 51:27

Terms don’t really get better than this. That’s why I’m invested. So yeah, they don’t pay me to say that. I looked at about 15 deals this year. I said no to 90% of them. This is one that I love, and we just put this out to our subscribers. So if you’re interested, if you’re a credit investor, usually the lowest investment is $25,000. Again, you have to be accredited, and I get to talk to you before you come in. And I do that for a reason. I want to make sure that this is right for you. I’ve spoken to people that say, hey, you know, I might be able to invest in one deal. No. You got to invest in at least three of these a year. You got to be diversified because they are risky. You need one out of ten to work, and it’s going to cover your next 20 investments, right? But you need to know where to go. You want to increase the odds. You want to de-risk the situation as much as you can by investing in people, investing at the right stage of this, not too early, not too late. Companies that have patents compared to patents pending.

Frank Curzio 52:19

Management teams have been there and done that. It has several exits. There’s a lot of stuff that goes into it, and I’ve learned that because I’ve made my mistakes. I got my ass kicked on this a couple of times and said, okay, well, now I know what to do and what not to do. Not that I have a great, you know, it has improved my track record dramatically, but, you know, it doesn’t mean everything’s going to work, but you’re more cautious. You know what to look at in terms of these deals, and it’s why Peter Thiel is a rock star. Dorsey is a rock star when he invests in these things. Google, I don’t know if you saw when they reported daily. You see Google’s finance arm, the investment arm, and how much they invested in SpaceX early on, Anthropic early on, even, you know, even SpaceX down tremendously. They still generate, they’re probably into like $20 in that stock. So, you know, you’re following the right people. There is a formula to this, which, you know, which is really good. It takes a long time, a lot of experience to figure it out.

Frank Curzio 53:05

But Sugarphina, if you’re interested, email me, frankkerseyresearch.com. Really good favorable terms, and we have another deal coming out. So now is a really good time. If you’re an alpha member that came in, again, we’ll take that price off. Everything you paid for alpha will go into the membership of Kersey One, which is an annual membership. And man, we have so many awesome, awesome members in it, which you’re going to get to meet at our conference in October. So I just want to talk to you a little bit about that before we go here. So, Daniel, what else we have? We got earnings. I know Fauci is exciting. What do we have reporting? We have, who’s reporting after the bell, Joe? We have Meta and Microsoft right after the bell. Put up a chart on Meta really quick.

Frank Curzio 53:52

Wow, that was almost $800. And wow, just this up and down, right? So Meta has been kind of like, oh, you know, you’re looking since like December. They’re up and down, up and down, up and down. Nothing really since December. We’re seeing a lot of AI companies get nailed now. But man, if you put up, go to December for me. Go to December and now put it up against Google, compare to Google during that timeframe. Did it come up? What’s the percentage there? And that’s with Google coming down after earnings, which we’re probably going to see Meta do the same thing because Meta is going to increase spending because they’re going to increase spending because they’re seeing the demand. They see it. They’re going to get punished for it. That’s okay. Amazon is going to get punished for it. Maybe you see Microsoft cut back a little bit because, you know, they have to do something. They’re in software. They’re getting hit even harder. But even, you know, Microsoft has been a disaster too. But out of all of these, I’m really looking forward to Amazon.

Frank Curzio 54:50

I think Amazon is going to represent a screaming buy here out of all of them. We’ve been pretty good on this, Daniel. I mean, we’ve come into Google at the right time over a year ago and generated 100% returns. We just recently sold that stock in our portfolio. When I look at all hyperscalers, I look at Amazon being one of the best right now. And again, I remember Amazon hasn’t really done nothing. And now you look at it and it’s down probably less than a lot of the other ones. But I’m interested to see what they report, how good the number is. And hopefully we see Amazon report great numbers, great across the board, and the stock get hit 10% because that’s going to be a good entry point. You’ll probably see us recommend this stock in our portfolio, maybe, or another hyperscaler because now they’re coming to points where Nvidia is trading at 16 times forward earnings. Growing those earnings six, seven times faster in revenue than the overall market, which is trading at what, 19 times forward earnings.

Frank Curzio 55:41

That is insane. The stock is at 190 right now. One of the best companies in the world. All the spending comes filtered through this company. So much of it. Building the foundations. I mean, it’s really, really incredible. So I don’t know what you’re looking for in the next couple of days, Daniel, but it’s going to be very busy with earnings, very busy with the Fed. And of course, we’re going to be able to report back to you tomorrow with the podcast on everything that’s going on with the Fed. And last thing here, what’s the markets doing, Joe? We’re still down, right? We’re getting nailed. Yeah, pretty much down. All right, so.

Daniel Creech 56:13

Yeah, 1, 1.5% across the board.

Frank Curzio 56:16

There’s one company I’m going to look at that I’m going to give you guys a little heads up on that I saw a couple of interesting articles. And I invested in this company and it was one of my biggest winners, my stocks under 10 portfolio when I was at the street.com. Ashlyn was one of them. This one was another. It was IMAX because I read in Wired magazine of how all the companies now are shooting with 3D cameras and IMAX is going to be the biggest beneficiary. And if you looked at it, it was all like Peter Jackson, all the biggest like Spielberg, all of them. 3D cameras and also these high-definition cameras with an IMAX that they were shooting. And I was like, this is going to result in the company going through the roof. And it did. I remember low single digits and absolutely it went like double digits and it was a huge, huge winner. I’m telling you right now, the trend going on, if you’re looking at Odyssey. So did you see Odyssey yet, Daniel?

Daniel Creech 57:08

Nope, negative.

Frank Curzio 57:09

Did you see it, Joe? We got to go see it. I wanted to see it. I just haven’t had the time. I heard it’s unbelievable, like just great. And I know, you know, whatever the woke stuff behind. I don’t care about that. I just, I love the story. I heard it’s unbelievable. And, you know, Snell has done an amazing job in this. But if you look at IMAX, there are people flying. Did you hear about this, Joe? There are people flying like all over the place and driving like six, seven hours, eight hours to go see this in that special format. And let me bring this up here. So in 70 millimeter. So there’s just 25 theaters. It’s 70 millimeter. So there’s only 25 theaters that have this up-to-date technology. And it’s so massive and there’s stories about this that people are driving. And if you put a map up on it, I don’t know if I can find a map here. So it’s just 26 theaters that they’re pretty far away. So if you’re in the Midwest, it’s hard to go see it. People are driving like six, seven hours, 10 hours to go see it.

Frank Curzio 58:01

Specifically at this, even though they saw it already and said, we need to see that because it’s that great. What that’s doing is you have IMAX is able to charge much more premium prices. And if you can charge premium prices, people don’t mind paying if you’re going to offer a service that they love. Right now, what are we seeing? We’re seeing Netflix increase prices and throw commercials all over their freaking programs, right? Which doesn’t offer a better service. It offers something that’s better for them. Airbnb increasing prices dramatically. That’s why Savvy is really kicking ass right now. Another private company that has no fees in the rental market, which is on fire right now. Again, we’re doing fantastic in that name and they’re growing like a weed. There it is. Put up the map, Joe. That’s only where they have these. But people are driving everywhere. And I think the waiting list is like incredible. But these theaters offer this special experience. Unfortunately, we’d have to go to Miami from where we ought to go see it.

Frank Curzio 58:48

I think so. It’s by, yeah, I think it’s, yeah, I think that’s Miami. But look, they’re spread out like, you know, you have, you know, California has a cluster of them. In certain areas, it looks like LA, maybe San Francisco. But when you’re looking around, that’s where they’re showing this. But it just goes to show you that the amount of money that this movie’s making and how you’re able to film this tells every director, this is what we’re going to do. This is what all the AI systems are doing. I’m hearing every documentary, everything they do, they filter through AI and AI tells them if they should make it or not right now. So it’s almost impossible. I’m hearing this from insiders who’ve made documentaries all their life and movies all their life. AI is coming in, not just creating and creating a movie, but it’s actually telling them and doing analysis through Claude saying how much this movie’s likely going to generate and they won’t even go with it. I think they were going to do, I think it was something, I don’t know if it was a Kansas Jayhawks or basketball was invented.

Frank Curzio 59:36

And I think they had LeBron in it and they said it’s not going to do. And they had LeBron’s name on it as well. I mean, you know, you didn’t go to Kansas and go to college, but you went straight to the NBA. But I think he was behind this and making it. And they said, we’re not going to make it. And it’s LeBron’s name on it, right? LeBron is a massive father, like him or not. So, you know, when you’re looking at something like this where directors say, okay, if we really film movies like this, there’s going to be so much demand. You’re seeing massive demand. But IMAX is at the forefront of this. Another company trading at its all-time high just blew out the numbers. But you got to look at the future of movies going forward that this works. Right now we have 25. You’re going to see probably in three years from now, at least 50, 75 of these theaters come up. And IMAX is going to make an absolute killing through this because people are flying everywhere. They’re taking planes. They’re paying freaking a lot of money just to go there to see this freaking movie in this format.

Frank Curzio 01:00:26

If you saw it in 70 millimeter format, let me know. I’d love to hear your thoughts. I know there’s a lot of people listening to this podcast. They also have some of these internationally. And this goes out to 130 countries. Let me know. I’m curious to hear about it. But what they’re writing about and what I’m reading, like the experience is nothing like they’ve ever seen. I’m a big theater guy. I have a home surround system as well. I love this shit. I’m just curious to see. But it opens the door to IMAX to say, hey, we could build this out tremendously. People are going to pay. I think they pay 3X compared to what they paid to a normal, I don’t know if it’s like $4 a ticket or something. I don’t mind paying $4 a ticket if I go to this thing. And the experience that people are telling me when they see this is unbelievable. And the fact that they’re driving around the country just to see it in this format when they can go probably 10 minutes away to their own theater. This is a company that I’m going to be looking at a little bit more.

Frank Curzio 01:01:11

I love this name. I’ve been part of it for a very, very long time. Again, I don’t own it, but I know a lot about the history about it and first recommended this, I think in 2009, which again, it was in low single digits and stuff, which is really cool during a crisis. So yes, IMAX, take a look at it. We’re going to be looking at it as well for our portfolio, but this is a name that makes a lot of sense. And don’t worry about that straight up line that you see right there. That’s very, very good. And they’re doing that on the back of higher earnings. So it’s not like you’re buying a stock that’s more expensive because the price went up because earnings are going up alongside of it and even faster than the price. So it might be a really, really good buy here. And they have really, really good short to long-term trends. And those tailwinds are not going away anytime soon. So other than that, Daniel, like I talked a lot towards the end, I don’t know if you, again, I asked you if you were looking at anything or seeing what’s up in, you know, earnings.

Frank Curzio 01:02:00

Are you expecting anything? Are you going to?

Daniel Creech 01:02:02

Oh, yeah. We’ll watch the hyperscalers tonight. It’s a big week. Big week with the Fed.

Frank Curzio 01:02:05

You buying ahead of them or what? What are you doing? What’s the smart money doing? Get your crystal ball, Daniel. What are you doing? No, I don’t know. Meta, Microsoft. Which one’s up? Which one’s down? Let me hear.

Daniel Creech 01:02:15

If I had to guess, I’d say Meta goes up, Microsoft goes down. If I have to pick one or the other.

Frank Curzio 01:02:21

That is interesting. Did you see software companies reporting though? I mean, we had a software company today. I forgot the name of the report that got nailed. But obviously, you’re seeing money pour into software a little bit more compared to AI and rotating. So, you know, Microsoft, it’s going to be interesting if Microsoft doesn’t meet those numbers. But I don’t think Microsoft expectations are going to be as high as Meta’s. So I would say, what did you say? Meta higher, Microsoft lower? I’m going to say the opposite. And we’ll check that out tomorrow. We’re not betting on this with our own money. We’re just guessing. Sometimes it’s a coin flip to see what earnings are going to be coming out. A lot of people like to gamble. We don’t gamble. We like to buy companies and really analyze them for a while. I’d rather analyze them after the results come out. But let’s see. But Microsoft and Meta are going to move the market along with the Fed. It’s going to be interesting day tomorrow. Lots of more earnings next week as well. We’ll be here for you. Questions, comments, email at Frank@curzioresearch.com.

Frank Curzio 01:03:07

Daniel?

Daniel Creech 01:03:08

Daniel@curzioresearch.com.

Frank Curzio 01:03:09

All right, guys. We’ll see you tomorrow. Take care.

Announcer 01:03:12

Wall Street Unplugged is produced by Curzio Research, one of the most respected financial media companies in the industry. The information presented on Wall Street Unplugged is the opinion of its host and guests. You should not base your investment decisions solely on this broadcast. Remember, it’s your money, and your responsibility.