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Announcer 00:00

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Frank Curzio 00:11

It’s Wednesday, June 24, and I’m Frank Curzio, this is the Wall Street Unplugged podcast, where we break down headlines and tell you what’s really moving these markets. Daniel Creech, how’s it going?

Daniel Creech 00:28

Hello, Frank. Happy Wednesday.

Frank Curzio 00:29

Happy Wednesday. I know you weren’t too happy because when we got off the air on Thursday, was it, you were looking at Kepka at the leaderboard.

Daniel Creech 00:40

Yeah, you were the one that said he was going to run away with it. I didn’t.

Frank Curzio 00:43

No, it just—

Daniel Creech 00:44

I wasn’t ready for it.

Frank Curzio 00:45

It was, yeah, it was pretty crazy. It’s, man, what a tough course. And, yeah, it was a good tournament. I’m glad, you know, that—what’s his name—who won it?

Daniel Creech 00:57

The hotel. Wyndham Clark.

Frank Curzio 00:59

Yeah, so Wyndham Clark won. He was up by a lot, but it got very, very close towards the end. Congratulations. But, yeah, just the last two majors, right, it’s pretty crazy. It just shows how tough these courses are. And I just wish it was a little bit more competitive, like three or four or five different golfers I could win because he was so far ahead and it was really only one cheff letting go. But it’s probably a little more excitement.

Frank Curzio 01:18

But, yeah, that was pretty cool. And then we got soccer going on, which is very interesting. The U.S. is doing very well right now, but very exciting. And, man, I don’t know, have you seen all the videos with all the—everyone who’s traveled here from overseas, you know, trying our food, being in America for the first time, and how happy they are?

Daniel Creech 01:36

Yeah.

Frank Curzio 01:37

I mean, they’re all going, “Crazy, this food is great. We love this place.” And, you know, Scott’s taking over everywhere. And it’s just—it’s been so cool. It’s amazing how, yeah, everyone else loves this country and wants to be here, but so many people here, I feel like, you know, get pissed off and don’t realize what they have sometimes, you know? It’s—

Daniel Creech 01:51

I don’t know if I got—if I’m being punked, but did you see about the ranch dressing and people taking it home and not checking it? And then supposedly they were going to make it in the—whatever the size is, 2 or 3 ounces or whatever that’s allowed to be. I thought that was pretty funny. But shout out to Waffle House. I heard they’re getting a lot of good press from there.

Frank Curzio 02:11

Yeah. And shout out to Wall Street Journal who wrote about the ranch thing like two weeks before the World Cup, I believe. It was just funny. But, yeah, it’s pretty cool. I think sometimes we just have to sit back. And I know there’s frustrations, and the media makes us frustrated sometimes and wants us to pick and choose size. But at the end of the day, we live in the greatest country in the world. It’s awesome. Freedom to actually say that you don’t like shit, right, and talk about it.

Frank Curzio 02:30

But, you know, a lot of people are jealous of us when they come here. You could see it. But—and those aren’t fake. There’s thousands and thousands and thousands of videos of, you know, just so many happy people love being here and how great it is. And it’s really, really cool. So I just think sometimes we have to take a step back and appreciate what we have here instead of complaining about all this shit while we’re sitting in traffic on our brand-new iPhones in a car that we just bought, you know, traveling to our house that we have ownership of.

Frank Curzio 02:52

It’s, yeah, it could be a lot worse, guys, really. So it was really cool to see. On another note, we launched our Curzio Alpha product, and, man, a lot of work put into it. For six months, it’s given everybody access to pretty much a one-stop shop, right, which we changed instead of having a bunch of newsletters.

Frank Curzio 03:08

You know, why should you be punished for having the wrong newsletter when you should be able to go wherever we feel like we want to go within the markets? Because they’re ever changing, right? So we know that our competitors and everyone across the industry all has 50 hundreds of newsletters every place. For us, it’s one product, everything under one umbrella. And the response has been overwhelmingly positive, over 90%. Some people, I get,

Frank Curzio 03:27

you know, you’re not going to please everyone, and that’s perfectly fine. But if you’re a subscriber, check your emails. You got special emails from us. You know, we went through every single subscriber personally. It’s going to offer you, you know, the best, you know, discount compared to everyone else. I know it’s based on how long you’ve been a Curzio member. So it’s been eight, nine years. How many products you subscribed in the past.

Frank Curzio 03:46

And, you know, the offers we really spent a—again, it was personalized. It wasn’t just a blanket email saying, “This is what you’re going to get.” It was really personalized to just say, “Hey, we appreciate everyone that’s been on our file for such a long time and following our research and, you know, been doing this for 30 years.” And the reason why you do this for 30 years is if, you know, you have a good brand and, you know, people trust you, right? So, you know,

Frank Curzio 04:04

I started this company, I think, eight, nine years ago, and, you know, now we’re really rocking and rolling and building, and it’s a lot of fun, and I just want to provide the best services and the best way for you guys to make money. And, you know, as long as we focus on that, we’ll be around for another 30. And I’m glad a lot of people like it because there’s a lot of work that went into it, the team and everything, just, you know, so much. Sending individual emails to every subscriber,

Frank Curzio 04:23

just it’s, again, it wasn’t blanket emails, but just the technology behind it, the screening that you have to create a portfolio within our portfolio of all our stocks because we merge a lot of stocks together. You know, it’s really, really cool. You get live events, exclusive stuff, text messaging is coming, this way we can alert you. And, you know, just it’s—we really fine-tune it to make it a better experience for the customer.

Frank Curzio 04:45

And so far, yeah, the feedback has been overwhelmingly positive. So we’re really happy about that. And if you’re interested in learning more, just go to curzioresearch.com because we’re going to really start marketing this a lot to the outsiders and everyone else on our podcast and who, you know, are followers all over, you know, the X platform and our social media platforms, which, again, that traffic is really exploding, which, you know, is humbling and is really, really cool.

Frank Curzio 05:05

So, yeah, just happy to see so many people really appreciate what we’re doing because we love what we do, DANLI. We work our asses off to provide you great stories. And that’s what we’re going to do today, just give you different opinions about what’s going on within the market. We could start there because it’s pretty crazy right now, Daniel. I don’t know if the market’s going up or if it’s going down, and that’s our job to tell you.

Frank Curzio 05:21

But I could say every time we feel like the market is going to sell off and AI is getting stretched, we immediately bounce back. And it’s very hard to see what the calls are going to be going forward to push us higher. We do have some tailwinds, but a lot of them are priced in.

Frank Curzio 05:41

We’re talking about a lot of those. But, you know, we had the Fed meeting, which was, you know, recently, and, you know, we saw a sell-off given the hawkish nature of WASH and possible rate hikes in the future. And then what happens is we rebound the next day. Then yesterday, again, Nasdaq opened down 3%. People concerned, Micron got annihilated. You know, Google AI names got nailed.

Frank Curzio 06:01

And then, you know, today another rebound. But, Daniel, what’s your crystal ball telling you? Should we be buying on every pullback? Which has been the strategy basically since the credit crisis, right? And you’ve been right because, you know, you’re looking at the major indices pretty much close to all-time highs. Nasdaq is a little bit more off than the S&P, but the Dow is really pushing new highs. Or you should be—you should be lightening up your stance,

Frank Curzio 06:22

especially on technology because that’s been a big winner. And yet you’re seeing some of these names pull back. You know, what’s your crystal ball telling you, buddy?

Daniel Creech 06:30

Well, it depends, Frank, on your timeline. If you need some cash, I would definitely go ahead and lighten up. I mean, you can look at indices. If we’re not at highs, we are very close to the highs. You mentioned the Dow Jones continues to rally and such. So if you need some cash or you need money, there’s nothing wrong with trimming a little bit.

Daniel Creech 06:46

I do think it’s still a buy the dip, but I think it’s not a long limb to go out on to think that we’re going to have these violent, volatile corrections. Just like last year with the tariff tantrum, we’ve had a pullback this year already with the Iran war. I don’t think it’s crazy to think of another 10%.

Daniel Creech 07:06

You know, could markets fall 10% from here? Absolutely. Do I still think they’re going to finish higher by double digits? Absolutely. Listen, you don’t have less volatility when you have more and more debts and deficits that we’ve always talked about. Not to mention, I think it’s still a buy the dip because you have so much stimulus and tailwinds coming through the one big beautiful bill that was passed.

Daniel Creech 07:26

There is some deregulation under the currents that I think are taking place and will only gain momentum going forward with Fed warsh and such. So, yeah, it—listen, I don’t know exactly where they’re going to go next day. Anybody that tells you they are, I think they’re lying to you. But, yeah, it’s a buy the dip, and you’re going to have to be able to stomach volatility because, again, you don’t have all the money printing,

Daniel Creech 07:48

debts and deficits, and craziness going on and have less volatility and more stable markets. That’s not how this works. So buckle up.

Frank Curzio 07:55

No, buckle up. You know what it is too? When I say catalyst, we’ve talked about, you know, tailwinds, and we talked about that. Government spending is going to continue. You’re going to see tax shuts coming just before the elections. We know that. Maybe a month before the election, so September, around there, maybe in August. Earnings have been really super strong. I mean, earnings are growing like crazy. You have oil prices finally coming down, right?

Frank Curzio 08:14

But a lot of this stuff, you know, especially with oil prices in the last, I would say, three to four weeks, the market was trading as, you know, oil prices were going to come down, we’re going to get a deal with the straight in Iran. But now that we have this out of the way, and again, we have the Fed meeting, and it’s kind of tough because they were hinting as being more hawkish.

Frank Curzio 08:33

And all you have to do is hint at being more hawkish. It doesn’t necessarily mean you’re going to have to raise rates, but we’re not pricing into that. We are seeing inflation definitely elevated, you know, along with, you know, higher rates for longer. And that’s not a good environment for technology, as we know, for technology stocks. And especially when you see the amount of money that’s being borrowed and interest rates are going to stay higher for longer,

Frank Curzio 08:53

it’s, you know, not as easy. Now they’re starting to sell equity in their stocks, which makes sense. That’s the best way instead of, you know, tapping the debt markets, higher interest rates, or diluting with equity and stuff. So compared to diluting with equity, which, you know, Google did, and that’s fine. They raised money, and their price barely moved when they did that. It’s coming down now because they lost some key executives, which—how do you lose?

Frank Curzio 09:14

If you’re Google, with a $3 trillion market cap, right, and you have some of the top guys in AI, and I get it because it’s a whole poaching game right now between everyone. How in the hell do you let somebody poach your top members of your team?

Frank Curzio 09:29

How do you not have those guys completely locked up since they’re the ones that are responsible for you generating literally close to $100 billions, right, and your future of your company? And I get you can’t lock everyone up, but you really want to lock up the key guys. Like, how do you—how does a company like Google lose these people? What could OpenAI actually offer them,

Frank Curzio 09:48

which maybe, you know, they’re not public yet and they’re coming in at low valuations? It’s easy to offer that where a public company has to disclose a lot of that stuff. You can go under the hood a little bit and hide a lot more of that and, you know, the options and everything. You know, they can make an absolute fortune. I get it. That’s how—it’s not just the money you’re paying them. It’s how do you do it within stock where, you know, they can make an absolute fortune.

Frank Curzio 10:08

That’s why some of the smartest people go to smaller companies because you can make—you can make hundreds of millions of dollars if it works out, right? So I see that. But I don’t know how they got those people poached, which is hurting Google stock anyway. You’re still seeing the private markets getting hit here. So, you know, there’s back and forth. And usually when you have the back and forth, it’s usually good conditions when you don’t have overwhelmingly positive conditions or overwhelmingly bearish conditions.

Frank Curzio 10:30

Those are usually contrarian indicators. But now you have this balance where I don’t know if it’s going to go up or down, but it just seems like there’s buying coming in. A couple of points I wanted to make interesting this week. There’s some stats I want to bring to you, which I love. And you’re not going to hear this really anyway. I don’t think—I haven’t seen anyone reporting on this. This is amazing. So if you’re looking at Thursday, right, that was triple witching and S&P rebalance.

Frank Curzio 10:51

So, you know, the S&P rebalance happens all the time. So, you know, every quarter, there was a record $1.9 trillion traded last Thursday. And just to put in that perspective, it’s 10% higher than the previous record, which was obviously the quarter before.

Frank Curzio 11:13

So you’re looking at the total shares traded on that day was $34.6 billion, 63% higher than the rebalance in the second quarter last year, which is insane. And then you could say, okay, we have, you know, SpaceX was launched, but SpaceX, I think, was after that. But,

Frank Curzio 11:33

you know, when I hear and I look at some of these statistics of what’s going on, you know, just the amount of money coming in and the amount of trading that’s going on, even in speculative vehicles like highly leveraged ETFs, because another part of this—and please listen up to this because I’m going to talk about small caps a lot here—because small caps are really outperforming the rest of the market.

Frank Curzio 11:52

And it kind of makes sense when you take a step back and think about it. But this is the part that’s really interesting. And Thursday’s, if you’re looking at, you know, record-breaking share volume, you know, it was driven by huge activity in sub-dollar stocks. So these highly speculative names.

Frank Curzio 12:10

And I’m going to say, you could be like, oh, how much was it? Like, percentage-wise out of how big it was, would you say like the percentage? I would think, all right, maybe 10, 12%. It accounted for 26% of the volume on Thursday, sub-$1 stocks, stocks trading below a dollar, right? So to put in perspective, it represents the highest year-to-date share for sub-dollar equities.

Frank Curzio 12:30

And it’s more than double the year-to-date average, which is usually 12%. It was 26% on that Thursday of how much was trading of stocks that are under a dollar, which means there’s so much speculative money in here. It means I could even filter it out to where a lot of speculative money from Bitcoin looks to be coming into the stock market now, right? Maybe that’s why you’re not seeing this,

Frank Curzio 12:49

you know, push where you’re usually seeing Bitcoin push higher and the markets are doing better and it’s speculative. And, you know, when markets hit highs, you get more speculation into the markets. People feel like they’re being left out and FOMO and stuff like that. You’re seeing the amount of money in these crazy leveraged products, high leveraged products, which is why you see volume and you’re seeing the market like flip around and zip.

Frank Curzio 13:10

Like, it opened up 3%, down 3% yesterday, and then all of a sudden we’re up today, right? And it actually came back a little bit, you know, yesterday as well. So, and you had this feel like, oh, there we go. And then boom, this buying comes back in. But it’s not easy to predict. It’s not easy to stomach. But I think you have to have money on the sidelines here. That’s why we sold some of our positions,

Frank Curzio 13:29

not all, not even close to all of our positions, but we sold a lot of our winners, took profit in some of them. This way we have money on the sidelines. This way we could buy a lot of stocks because there are a lot of stocks that look attractive, especially small caps. I don’t know if you’ve been paying close attention to the small cap market.

Daniel Creech 13:43

No, not too much. I mean, you got some good stats on there. The stats that you just shared were really good. If the market pulls back 10%, you could always look back and be like, aha, there’s a sign of the top. Look at all this sub-$1 trading and all that kind of stuff. So, yeah, I mean, markets can be a casino in the short term for sure. So if you’re playing in that game, have fun. But I would rather go to Vegas. It’s better odds and a better time, Frank.

Frank Curzio 14:02

I mean, so look at this. The Russell right now is up. Micron’s actually declining again. It’s down 13% into the print. I just feel like it’s an NVIDIA thing where NVIDIA is going to come. Micron reports tomorrow, and we all know the story with Micron. Tonight, I mean.

Daniel Creech 14:15

After the bill.

Frank Curzio 14:15

Yeah, yeah. So, you know, I mean, this stock is up nearly 1,000% a year. It’s down a little bit. It went down 13% yesterday, and it’s kind of flat. And I think they’re going to report numbers that are insane and raise the guidance. The stock’s probably going to come down. It’s going to give you a good buying opportunity, just like NVIDIA did for about four or five quarters in a row, which we said to buy it. And what I’m looking at even today, look at the market.

Frank Curzio 14:34

I mean, the Dow Jones is up 0.8%, the S&P up 0.5%, the Nasdaq’s rebounding up 0.6%. And then look at the Russell. It’s up 1.2%. And when you look at the Russell and you look at, let’s go to six months here, if you guys could see this. If you’re not, I’ll explain it to you if you’re just listening in. So I’m going to compare the small caps to the Nasdaq,

Frank Curzio 14:55

which if you’re looking at six months, small caps are up 19%, and you’re looking at the Nasdaq up just 9%. So that’s basically year-to-date. But even if you’re looking at the last month where we saw a lot of volatility in AI names and technology and stuff, and basically we’re looking at the Nasdaq, which is filled with all the hyperscales technology, big technology, down 2.2%.

Frank Curzio 15:17

Small caps were up 5% in the past month. That’s massive in one month. And it makes sense when you think about it because we follow the small cap market all the time, and we happen to do very great over like the last, I mean, it’s been 12 years plus of outperformance for large caps compared to small caps.

Frank Curzio 15:32

Even when you have a bull market, which is weird because in the past, that’s why we always say, stop reading investment books because we’re in a market that’s never happened in history with the amount of money flowing in from the government. They backstop anytime we have any problems in the banking system immediately. You know, it’s just a different market today than we’ve ever seen with the amount of money coming in. And, you know, not that you want to ignore the past.

Frank Curzio 15:53

I’m just saying it’s not dictating the future. That’s why economists have got it wrong with transitory and all that shit and didn’t realize inflation was going to spike because they’re looking at past models. And, you know, it’s this whole rewriting of economics and markets, and that’s getting people confused and saying, how come these companies that aren’t making a lot of money are going up so much? Because you have to look at the massive growth potential,

Frank Curzio 16:13

especially when you have 700 billion from the top five hyperscales that are coming to this market, which is crazy. But, you know, when you look at small caps, what happened, especially in the past four or five years, and we’ve taken advantage of this where they restructured their operations, they were falling behind, they let go of employees, they lowered their cost structure.

Frank Curzio 16:30

And now, I always say the biggest boom to a business is when you’re lowering costs and then you find out what’s working and you focus on those few things that are working, and you shed the crappy parts of your business. And that’s where things explode because not only are you saving money, you’re actually generating, right? You’re seeing this growth trend and your earnings explode. Now throw on AI to that.

Frank Curzio 16:49

This is the biggest advantage small caps have ever had where you need big teams to grow. You need big teams to scale. And now you have AI replacing so much of this, which is keeping their costs lower while able to increase their output and increase productivity for the first time ever. So these small caps, I mean, even, yeah, Sam Altman said this,

Frank Curzio 17:08

and I don’t know if I’m total in agreement, but the fact he was like, this is going to be the first time in history that you’re going to be able to create a billion-dollar company with one employee. I don’t know if I’d go that far. But still, you’re getting the point is you don’t need this massive team as you’re growing to scale. And it’s always a tough part of the business. And we went through it when we were growing earlier, you know,

Frank Curzio 17:27

years ago because you want to spend money and everything’s going great, and then all of a sudden when things don’t go great, you’re sitting there with a lot of excess and you have to cut. And it sucks. That’s what businesses do. Now you’re seeing these companies grow earnings like Oracle and cut, you know, 12% of their staff. And this way they can spend more money on what’s working, which is growth in AI and data centers. So small caps as well, they’re in a great position.

Frank Curzio 17:47

They still significantly underperform in such a long time. Yes, they’re trading at 3,000 for the first time ever, the index to Russell 2000. There’s so much money to be made in this industry now, especially if you have companies that are using AI that are partnering. And we picked off a couple of these names that are partnering with OpenAI and saying, here, here’s an API, here’s a key to our kingdom, here’s all of our clients.

Frank Curzio 18:06

We want to use your cloud, special discounts, and help us out with AI. This way, everything that anyone’s going to search is one-click shopping on Google’s platforms forever. So, and it’s amazing to see what these companies are doing with AI. But small caps, man, I love small caps right now. I’ve loved them for a while, and especially the last year, they’ve been outperforming, but now they’re really starting to outperform,

Frank Curzio 18:26

which again, something you never see. When technology’s on fire, there’s usually speculative names that are going higher. The Russell usually outperforms. It’s underperformed for such a long time. And now that AI is coming down a little bit, you’re still seeing small caps really ramp higher and do, you know, going up higher on days that are bullish and on bearish, it’s going down less than the overall market.

Frank Curzio 18:47

That’s not a trend you usually see. It’s usually more on the upside, more on the downside. And it’s just, to me, it shows like the strength of the Russell and a lot of these companies getting it right within AI. Not all of them, but man, it’s definitely, it’s a game changer, this technology, especially for smaller companies. And I think there’s going to be so many opportunities to make so much money in this sector compared to just buying the Googles and the Amazons and stuff like that.

Daniel Creech 19:08

Yeah, that makes sense. I mean, AI is definitely a difference maker and levels the playing field, kind of that David versus Goliath type deal. So, yeah, I’m not going to argue that. That’s pretty cool. And I definitely think there’s going to be more opportunity and plenty of volatility in there. I mean, just, it’s crazy.

Frank Curzio 19:22

And don’t sell every, one last point here, Dan. Don’t sell everything. Like you’re looking to sell, okay, AI-related names and all hyperscalers are getting crushed. It’s not true. Okay, so when you’re looking at, you know, the Dow hitting records pretty much and the S&P close, you know, Nasdaq not really, but it’s basically five, six of the largest companies in the world that are pushing the Nasdaq so much higher.

Frank Curzio 19:42

And now you can throw SpaceX in there, right? Again, trillion-dollar companies. But I wouldn’t be selling all tech and getting out and saying, oh my God, I think the spend might not last or whatever. And again, we have contacts in the industry and spending is out of, is crazy right now. It’s absolutely crazy. And they want more, more, more, more, more. There’s just not enough capacity out there. There’s not enough skilled laborers out there to build these data centers.

Frank Curzio 20:02

And we’re hearing that anywhere they can get power, they’re trying to get this still spending. But if you look at specific names, and for the record, let’s not talk about Google, Apple, Amazon, SpaceX, right, that have run up and SpaceX pulled back a little bit. But let’s look at some of the other hyperscalers that no one’s really talking about. Oracle, okay, Oracle went from 345 and it’s trading at 170.

Frank Curzio 20:22

They’re trading at, what’s the market multiple thing? Around 20, 21, right? For forward earnings for S&P 500, 2021. Okay, Oracle’s trading at a market multiple of 21 times forward earnings. It’s growing their earnings at 24%, sales at over 30%. That’s what they’re projected to grow. NVIDIA is trading at 20 times forward earnings, a discount to the overall market, right?

Frank Curzio 20:42

It’s down from 236 to 200, and it’s the same levels it was trading in November. And they’re growing sales and earnings by 40% plus. Meta is trading at 18 times forward earnings, down from 800, almost 800, to 560, 570, growing earnings by 30%, sales by 17%.

Frank Curzio 21:02

I mean, holy cow. You’re looking at Netflix is down, right, trading at 22 times forward earnings. Again, they’re growing earnings a little bit slower, but double digits by earnings and sales compared to Oracle, NVIDIA, and Meta. But do you really want to sell Oracle, NVIDIA, and Meta here? Because for me, I’d be buying these names if you have a six-month plus time horizon because these are dirt cheap.

Frank Curzio 21:21

They have already gotten annihilated. Everyone’s talking about the AI spend. They’ve already increased their spending, and people are worried about them. But it’s not the whole, the point is, it’s not every single hyperscale that you have to sell. You’re like, whoa, Google’s still higher. Amazon had a nice move, and Apple’s just been, you know, chugging higher the whole time. Not that they’re the hyperscaler, but it’s not, you can’t put them all in the same boat.

Frank Curzio 21:40

There’s clear separation. I mean, Meta, NVIDIA, Oracle, NVIDIA not as much down what, 10, 15%? Oracle’s gotten smoked. Meta’s gotten smoked. I mean, these stocks are down 25, 30% from their highs, and yet their growth is still intact, and they have the ability to cut costs while they’re still increasing productivity because they have AI all over the place.

Frank Curzio 22:00

But those are names where you don’t want to be selling, I think, here compared to some of the others. So let’s not lump all the hyperscalers and all the AI spend, and you got to watch out for AI. It’s rare it happens, but these companies are giving you that rare window of a 30, 35% decline where you could come in here and buy these things, and their earnings are growing tremendously.

Frank Curzio 22:21

It’s why their PE ratios are down so much. It’s price divided by earnings, right? So when your price is coming down and the E component is going higher and surging, the stocks get incredibly cheap. Those are three stocks that are incredibly cheap. I mean, why own some of the others, why own anything else outside of, I mean, NVIDIA trading at a market multiple, below a market multiple, growing earnings and sales by 40% plus?

Frank Curzio 22:42

Are you kidding me? I mean, find another large cap with those metrics. I don’t think you’re going to find them. It’s going to be much more expensive if they’re growing that fast. So, you know, it’s opening the door to opportunity. It’s why we want to put cash on the sidelines here a little bit, maybe 20, 25% to give us opportunities to buy names like this when you see this disconnect, because there’s a clear disconnect in all three of these names.

Frank Curzio 23:01

Their growth is still much intact, and I think it’s going to provide good opportunities for investors.

Daniel Creech 23:06

Yeah, that’s a good point. I like Amazon too is bouncing off the 200-day moving average on a yearly chart, and it’s going to run into the Prime Day, Frank. You know, big Prime Day is what, June?

Frank Curzio 23:17

Now.

Daniel Creech 23:18

It started. Okay, I thought it did start.

Frank Curzio 23:19

Yeah, Prime has started. I have to go back and go on and see and spend money on things that I’m never going to use, like I always do, right? Oh my God, there’s on sale. I was looking at this, and I wind up next day and I have like four or five boxes outside my door, and I’m like, shit, what did I do? So.

Daniel Creech 23:32

But that’s another great stock that’s off of its highs. Not a ton, but, you know, kind of gets just thrown out, and there’s just so much optionality there. It’s just an incredible stock. So yeah, depending on your timeframe, exactly. I wouldn’t lump all AI together. The story is not over. The spending’s not stopping. So, but that doesn’t mean you can’t have volatility, obviously.

Frank Curzio 23:48

Before we go further, Savvy is a vacation rental disruptor. So you might remember my interview with CEO Eric Goldwire, and this is a person that had two huge exits in the vacation rental space, bed and breakfast.com and Turkey Vacation Rentals, and has been in this industry for about 30 years before Airbnb and Vrbo even existed. Now he’s come off the sidelines to create Savvy.

Frank Curzio 24:07

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. You know exactly what he’s talking about. Now at Savvy, it’s an online direct booking marketplace without those massive fees, which travelers save on average $500 with professional hosts dealing exactly with them and exclusively with them on every single listing.

Frank Curzio 24:27

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.

Frank Curzio 24:46

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? Daniel, lots of stocks and stories I want to mention, lots of stuff happening, which is really cool.

Frank Curzio 25:05

And one of them is Cerebras today reporting, and that stock’s getting annihilated.

Daniel Creech 25:09

Yeah, down, well, it was down 10%. I’m not sure if it’s still down that way.

Frank Curzio 25:12

16%.

Daniel Creech 25:13

But, you know, I don’t know that earnings and stuff matter, but they lost 22 cents a share. Supposedly that was higher than the 16 cent loss expected. However, Frank, you got some growth. Revenue grew 94% year over year. They’re expected to do just under a billion dollars. Stock’s pulling back. I don’t know what it’s currently trading at.

Daniel Creech 25:33

However, Frank, are you surprised or not surprised that this headline or data point isn’t moving the stock better? Company announced a multi-year deal with OpenAI valued at more than $20 billion.

Frank Curzio 25:45

And it’s a $40 billion market cap stock, right?

Daniel Creech 25:47

Okay.

Frank Curzio 25:47

So doing, you know, pretty much they’re going to do what, maybe a billion in sales? Like, based on the runway, they could do a lot more than that this year. But when I look at this stock, I’m probably going to buy it as soon as I get off. I think it’s a screaming buy here.

Frank Curzio 26:02

This is their first quarterly report since their IPO, which is what, a couple months ago. And again, stock’s getting hammered today, down 16%. And.

Daniel Creech 26:09

16 now.

Frank Curzio 26:09

And it makes, listen, if you’re looking at the stock for the first time, I get it. And that’s what CNBC is doing. Everyone’s displaying and showing how they have a decline in margins from 45% this quarter, and they’re projecting 30 to 40% margins full year. So right away, you’re like, oh, IPO companies, that means slowing down. It means they have to lower prices. What’s going on? They’re not getting the business. Like I said, I love the stock here.

Frank Curzio 26:28

I’m buying it, you know, on this pullback because, and I’ll give you several reasons. I mean, the margin guidance coming down was disclosed. That’s what was expected. Still need 40%. And for hardware company, yes, it does have software as well. Actually, software accounts of 40% of the revenue. But there wasn’t a surprise for anyone that follows the company.

Frank Curzio 26:47

But when you’re showing the margins contracting and people seeing it for the first time at CNBC, you notice how the stock opened down seven, and then, you know, it was like this holy cow. And then they had the CEO on, which I liked him. He’s not charismatic, and it wasn’t like, you know, he was just very factual and stuff. And, you know, I wouldn’t say it went bad or anything, but, you know, sometimes you get, you know,

Frank Curzio 27:06

compared to Alex Karp getting on there, and you always get excited and see the stock move. But when I look at this company, and just the assumption is that, you know, they’re going to have to sell their products for cheaper in order to get business is wrong. And it’s not true. And by the way, if you look at HP Enterprise, you look at Dell, both companies had super low margins when they first got into the AI trend to capture business.

Frank Curzio 27:26

And then when they had superior technology, they were able to raise their prices and look, especially Dell, look what that thing is, right? Now here’s, they disclosed 200 million in revenue for the quarter, for the quarter. Better than expected while reporting a loss of 22 cents, not worried about this. They’re going to be profitable very quickly. They’re spending a lot of money, which is fine.

Frank Curzio 27:45

You know, people concerned over $100 million in spend with 12 million, 13 million of free cash flow. I get it, but that puts them in the boat for every other company. And I don’t mind company spending when you have this massive growth trend of all the hyperscalers against 700 billion that they’re spending to build out their data centers and AI infrastructure. So when I look at the sales and I break them down,

Frank Curzio 28:05

Daniel, it’s hardware was 110 million, which is growing at 60%, and then you have 82 million in the services division, 82 million. So almost a split. It’s not like, hey, let’s get into services now, like Apple was first doing and 20, 25% of revenue and growing. It’s a big portion. That’s up 178% year over year, growing fast, faster than the hardware,

Frank Curzio 28:24

which is important because software, as we know, is super high margin business. So yes, they got those margins a little bit lower. It’s still 40%, which is an insane number. And I think that they’re going to easily beat that number going forward. And it’s always better to underpromise and overdeliver.

Frank Curzio 28:38

And two, their technology, it’s bigger, more compute, it’s absolutely amazing and presents a real and efficient more power option than NVIDIA. And I’m not saying they’re going to take meaningful market share from NVIDIA.

Frank Curzio 28:53

NVIDIA controls, I believe, 95% they control still of the 250 billion AI hardware market in the high compute market. And imagine this company just gets 5% of that. Okay, that’s 13 billion in annual sales. And that’s not, and you know, for a company generating what, just 1 billion in sales on a runway based on this quarter at a $40 billion market cap.

Frank Curzio 29:14

So maybe you’re saying, Frank, 1 billion to 13 billion, that could be a stretch. I mean, is it, did you see their current customer list? It clearly shows their technology is amazing and working. They have Amazon, they have OpenAI, what you said, the agreement where it covers deployment of 750 megawatts of high-speed inference compute over several quarters, multi-billion dollar contract.

Frank Curzio 29:33

Meta, IBM, AstraZeneca, GSK, Block, US Department of Energy. I mean, these companies are massive. They would not be using their technology unless they thought it was efficient and it works. And we look at chips and everything’s smaller, smaller, smaller. When you have data centers, you could afford to put bigger stuff in these data centers if it’s going to be faster. They don’t have to be pretty. A phone has to be pretty.

Frank Curzio 29:52

Computers have to be pretty. They have to be small and nice and lit up and stuff like that. Nobody’s walking through data centers. You just want more power, as fast as you can, efficient. And these guys are able to do that. You’re looking at a stock that is trading, where is it now? $130? Let me bring this up.

Frank Curzio 30:11

I’m sorry, not 130, $190, the wrong stock. So it’s $190. It’s trading at 190 right now. It’s down 16% today. And when I look at $190, again, it just IPO’d not too long ago where 190, Morgan Stanley has a 250 target, Citi has a 340 target. But, you know,

Frank Curzio 30:30

I’m looking at this stock where it opened near 300 after being priced at 180 on IPO day, which was an increase from $130 like two weeks prior to that. They have a big lockup. So you’ve seen a lot of shareholders that were in early saying, hey, you know what? I’m going to take out some money. I thought it was going to be 250. Now it’s 225. Now it’s 190.

Frank Curzio 30:49

Let me just sell because I’m in at $20, $30. That’s fine. You deserve it. But that, there’s not going to be tons of selling after that because the lockup has opened. You know, but it briefly traded 380 that day and came down. Now it’s below $200 a share. I think it’s a steal here if you’re willing to buy and hold past six months because the massive growth is not going to stop.

Frank Curzio 31:08

I mean, now if you believe AI, that spending is going to continue for the next few years, which we’re seeing no signs at all of slowing down at all from all my contacts within this industry. If you have any signs of this slowing down, don’t say delayed projects because they’re delayed because of supply constraints. They’re delayed because of labor constraints. Not enough labor, but it’s not because, you know, they’re spending less, right?

Frank Curzio 31:27

And if you have any proof of that, show me. I haven’t seen one data point, zero data points. And I’ve been saying this for the last year and a half, two years as people saying, AI, it’s going to crash and the spending’s going to slow. There’s no data points that prove that. It’s just people trying to sell you shit. And if you have it, send it to me. Again, I’ll be more than happy to publish it on here and show everyone. I haven’t seen anything and I have contacts really deep within this industry. Also,

Frank Curzio 31:47

this technology, Daniel, this wafer scale engine technology, it’s designed to deliver faster, low-latency AI inference, which is the biggest thing within AI right now. And next you’re going to see robotics. It’s much different than NVIDIA’s GPO cluster model that dominates the market today. That’s why I do believe they could take at least 5% market share, probably more over the next four years.

Frank Curzio 32:08

This company’s well positioned. Everything’s going right. 15% pullback, that’s fine. I think you’re getting a gift here. If you hold it past six months, it could go down to like 10, 15% from here. I don’t know. But man, the growth is intact. The margins are going to go higher. The technology’s great. And you have the biggest hyperscalers already clients that every time you’re a client and they see something working, they increase spending dramatically.

Frank Curzio 32:28

And I think that’s what you’re going to see with this company where earnings, revenue, free cash flow is going to explode as they continue to throw that money back into the company to expand, to become, who knows, maybe the next 500 billion, trillion dollar company. These guys have the technology to do that. I think it’s worth the risk here, especially on this pullback.

Daniel Creech 32:44

I like everything you said. I’m not sure what they, I’m not sure what announcement or partnership is going to get the momentum back. And maybe it’s just some of the selling and, did you say the lockup period is open?

Frank Curzio 32:56

Some of the lockup period is open, yes. So they’re able to sell some of those shares.

Daniel Creech 32:58

That’s a good thing for building the position. Absolutely.

Frank Curzio 33:00

Which is kind of quick, but hey, you know what? Depends what it is.

Daniel Creech 33:04

Yeah.

Frank Curzio 33:04

I mean, you want to see lockup periods really, really quick. Look at SPACs. Holy shit. I mean, I can’t believe it. It’s like this unregulated wah-wah West industry and pretty crazy with SPACs. But anyway, speaking of SPACs, just one of them I found is interesting, the concept. Do not buy this, please. It’s called TeamShares. TMS is a symbol. Don’t buy it. They just, they’re trading publicly.

Frank Curzio 33:25

I think it was yesterday for the first time, maybe the day before after the completion of their SPAC, which is Live Oak Acquisition Corp 5. And they combine the companies. But the purpose of this, and I want to bring this up because this is a pretty big deal, is they focus on acquiring businesses generating between 500,000 and 5 million in EBITDA, right? Which you see SPACs,

Frank Curzio 33:44

what they normally do is they’ll try to buy a high-growth company that’s maybe trading 200, 300 million dollars. Whatever the SPAC is, if they raise 500 million in the SPAC, that means they’re expected to get 2.5X of a takeover value. So if they buy a stock and decide to buy it at 500 million, what they’re going to do is raise a shitload of money,

Frank Curzio 34:03

go on a roadshow, and make this thing appear that it’s going to grow to the point where you’re going to pay, you know, a 750 million valuation for a company that’s 250. That’s worth 250 in the private markets. And that’s okay because they have pipe investors. Everyone’s getting in a dollar, dollar 50, 75 cents, $2, $3. And,

Frank Curzio 34:22

you know, the retail investor’s going to get fucked like you always do. And they’d like, hey, this is the greatest thing. They make sure that they all have the best buzzwords. It’s space. Space is great. We’ll go into space. It’s AI, specialized AI, frontier AI, right? They have all these things. And, you know, again, they want to excite you this way. All they can say is could dump all of that, dump the shit onto you. And you’re sitting there, you get annihilated, and SEC does nothing, right?

Frank Curzio 34:43

That’s what, that’s why all SPACs, what is it? 95% of them are down more than 90% since they launched. They still have them. So underneath, when you look underneath, be very, very careful. I looked underneath. There’s Securitize is doing one. Holy shit. It’s, you know, again, we’ve dealt with Securitize before. I have nothing against them. I hope they’re very successful.

Frank Curzio 35:02

The SPAC that they’re coming out with and the valuation, if you look under the hood of that, it’s going to make you fucking puke because, man, if you’re getting into that, you’re going to get annihilated. Do not buy that. Please don’t buy that. And I can’t believe the clients are not looking at that because they’re getting really, really screwed. The people who have been with that company the longest. Just look at the marketing agreements behind the scene. I spent like five hours on it. It’s disgusting. That’s what SPACs do. They have millions of pages.

Frank Curzio 35:21

You have no idea what’s going on. Bottom lines, everybody gets out earlier. They got much cheaper stock. Options get exercised at a penny. You know, when the stock’s at 12, 13, they’re hyping it. Be very careful. Anyway, this is a different model, right? Because they’re looking to acquire companies afterwards, right? So it basically seeks to be a permanent home for thousands of great companies as owners retire.

Frank Curzio 35:42

And I like that concept. Why? Because I’m very familiar through Sugarphina when we first invested in that company in the private markets and what they were doing is because you look at the management team behind it, understands the private equity market. You know, Paul Kessler is unbelievable. You know,

Frank Curzio 36:00

he’s just been a pipe investor for such a long time, but he structured this because he saw what was going on in the private market years before we’re knowing about it now. What’s going on? Everyone wants out. So what do private equity companies do is they buy these assets and they take them off market. They give them new management teams. They cut everything as they can. And they, you know, enhance that growth as much as they can.

Frank Curzio 36:19

They restructure it and they relaunch it as an IPO. More money and they cash out. Now, what’s happened is a lot of these companies, because of the market, they’ve gotten re-rated. They don’t want to mark to market. So if you bought a company for 500 million and you wanted to come out for $2 billion, now that company is probably worth half of the 500 million. So they don’t want to sell it.

Frank Curzio 36:38

And that’s why they created Sugarphina where they’re like for the confectionery, everything that they have within, you know, chocolate and gummies, the right gummies, not the gummies that, you know, we kind of all like, but, you know, just regular like healthy gummies. Yeah. Not the ones that really get you stoned.

Daniel Creech 36:51

Healthy.

Frank Curzio 36:52

And it’s a massive market and they’re growing, but it’s a roll-up strategy where they’re buying companies that are being sold for 10 cents on the dollar because private equity needs to get these off the books. And this way they have fresh powder, right? And they could go in and buy other things. And right now, you know, everyone’s trying to redeem and in a nerve. Anyway, I like this because what I heard for these companies, and it makes sense, when you take over, say if someone took over Curzio Research, right?

Frank Curzio 37:13

We’re not big enough, but just say if they took us over and they’re like, hey, we’re private equity, we’re going to grow your business and then we’re going to come out later and you’re great. Now I’m sitting dormant. They don’t have the money to put in to help growing my business. And I’m sitting there going, what the F? Like I can’t really grow my business now. We’re trying to do everything. You guys promised with your new management team that you put on our board that we’re going to grow, you’re going to fund us, and then you’re going to IPO.

Frank Curzio 37:32

They can’t do that. So now you have these companies that are really pissed off that are sitting there going, could we sell to someone else? No, you can’t because you’re going to sell a low valuation than we want everyone to know at. So, you know, having this option to create a company and saying, hey, these companies are generating 500,000 and 5 million EBITDA that they could buy and put under this umbrella.

Frank Curzio 37:50

This is a roll-up strategy that’s basically looking to capture a lot of these companies sitting on private equity balance sheets, which there’s a ton. We’re talking hundreds of billions, if not a trillion dollars that they’re looking to dump at cheaper prices under the radar. This way it’s good for these private equity firms because they have that cash coming in. Now they have more powder to actually,

Frank Curzio 38:09

you know, reassess more deals, which is what those companies are all about. And it also frees up a lot of these other companies where the management teams are just sitting there going, why did you take me over five years ago if you’re not even going to grow, you’re not going to put any money into the company because the private equity companies don’t have the money to actually help these companies grow right now, especially with all the redemptions coming in. So I like the concept.

Frank Curzio 38:29

Do not buy it because 90% of SPACs are structured like bullshit and, you know, their institutional pipe investors make an absolute fortune while again, they’re going to F retail investors and that’s what they do and nobody’s, you know, I could see this because this is what I do and I like reading 130 pages.

Frank Curzio 38:43

I’ve seen and highlighting literally in the Securitize deal where there’s literally 10 different places that I could highlight and show you and you’re going to be like, holy shit, they’re really doing this because nobody really reads it. Be careful. But I do like that concept, which is pretty cool with the private markets because we’re still seeing massive redemptions there, right? Daniel’s still seeing it.

Daniel Creech 39:00

There must be because I’m continuing to read headlines about lockups and all kinds of stuff. So yeah. And the fact that they don’t market their assets to market prices or have to update them is a red flag anyway. So just be cautious with all that crap.

Frank Curzio 39:14

No, of course. And you know what, Daniel? I looked at another company we mentioned, Accenture, and that symbols ACN. And this is a company where I think somebody might ask me about it because it’s down so much. And they said, you know, should I buy it here? And ACN is Accenture, right?

Frank Curzio 39:28

Accenture is a consulting gig, right? So it’s all consulting basically. And, you know, when you have AI and these companies, you know, they get paid to write great research reports and everyone cites them. You know, this market is, the total addressable market for this is based on what Accenture and stuff. And, you know, there’s a lot of companies that do this. Consulting is just,

Frank Curzio 39:47

you know, this middleman strategy and, you know, you really have to provide services that could help your clients. And now these services can be provided by AI. So the margins are getting crushed. And when you look at this stock, look at this, this is a year. I mean, this stock was what? Trading over pretty much 300, 307, and it’s 130, and you haven’t seen a bottom. Like, you know,

Frank Curzio 40:06

quarter after quarter, if you look 2026, you’re like, okay, 2026 was 280. And it’s coming down, coming down, it keeps coming down even further. And, you know, the stock is just getting crushed because it hasn’t figured out. And if you go out to 2025, you see this stock was trading close to $400, 380. You need to see a bottom in quarters where they’re not losing business or anything.

Frank Curzio 40:26

And we said, you know, just stay away until you see a couple of quarters. And who cares if it goes from 129 to 150, 160? I mean, it’s down from 300. At least you have confirmation saying, hey, they figured some of this stuff out. They’re integrating AI and they’re not losing as much business or, you know, less bookings. But I just saw a note that, you know, and people saying, oh, should I buy this?

Frank Curzio 40:46

Because this is a company that’s going to repurchase because they have a lot of cash of $2 billion to be completed

Frank Curzio 40:54

by August 31st, 2026. So it’s significant increase fiscal 2026 share repurchase program by 2 billion. It says it’ll be completed by August 31st, 2026 under existing board authorization. So I don’t know if they’re going to buy all those shares back right away. $2 billion worth of shares is a large amount. The market cap of this company is below 80 billion.

Frank Curzio 41:14

I will say that I think this company’s absolutely F-ing nuts to make this announcement. And the reason is because you don’t want to buy back stock if your technology is not working and it’s clearly not working. And if you want to look at their buybacks, guys, pay attention to this. Again, something that you’re not really going to see, but we have to highlight it. I’m not beating the shit out of a company here. I’m just highlighting facts because if you’re looking to buy this stock on a pullback, be careful because his management team should get fired.

Frank Curzio 41:36

Okay. So if you’re looking at 2024, they purchased, and again, we’re looking at a stock that is at 130. It’s $130 right now. In 2024, they purchased $4.2 billion worth of stock at an average price of close to 300. In 2025, they purchased $4 billion worth of stock for an average price of 326.

Frank Curzio 41:56

Okay. Again, when you’re looking at the stock, it’s trading under 130. And then last quarter, they repurchased 9.5 million shares for 2.3 billion at an average price of 245 last quarter, right? And the stock is under 130. They basically blew out all this money instead of what they’ve done. I mean,

Frank Curzio 42:14

we’re looking at 4.6, 2.3, that’s 7 with another 4, 8, 9, 10. I mean, you’re looking at 12, 13 billion dollars, which is a lot of cash. You bought back stock at higher prices and you annihilated shareholders, right? You make your balance sheet weaker by doing that when you could have purchased a lot of small AI companies just to,

Frank Curzio 42:35

again, you’re in a competitive market and it’s tough, but, you know, maybe someone wants to look to purchase something for two, three, but that’s a massive amount of money, you know, over $10 billion to purchase some of these companies, right? Just to get more AI integrated with what you’re doing. And, you know, you’re seeing some software companies separate from, you know, the annihilation because they’re getting more. Salesforce is still not there.

Frank Curzio 42:54

I still see Salesforce is still not there. It’s a very small part of their business, AI. Some of these other software companies as well, if you’re able to incorporate and show that, hey, AI is working within our current structure and this is the value that our clients are getting while you’re able to maintain that pricing power, those are software companies that are going to separate from the ones that are dog shit. Accenture to me, I mean, horrible management team.

Frank Curzio 43:14

The amount of money that they bought back on 297 was the average price, 130, right? That’s 14 million shares, right? 4.2 billion wasted. Another 4.6 billion wasted in ’25 at 326 a share on average price. And now first quarter 2026, not long ago, guys, right? $245 they purchased on average, 2.3 billion they spent.

Frank Curzio 43:35

Now what are you going to do? You’re going to increase that and you’re expecting your stock to go up? Holy shit. I mean, is anyone talking to this management team and saying, how about we don’t buy stock here? Let’s just, you know, it didn’t work for the last three years and you annihilated like, you know, shareholder value. I mean, is anyone like paying attention to this at all? I mean, everyone else who’s bought stock,

Frank Curzio 43:54

the hyperscalers or whatever, their stocks are near highs. That’s fine. They did a great job. This is a company that clearly has not done a good job and has not figured out AI. Stop buying back your stock until you figure out AI because you’re annihilating your shareholders. And right now you’re telling me by making that announcement, it makes me want to short the stock at 130 instead of buying it. So that’s just my opinion. But what do I know?

Daniel Creech 44:13

Yeah, that’s a tough track record of buying. Imagine what the earnings per share would have been if they weren’t buying back all that stock. So they would have been a lot worse. But yeah, that’s crazy.

Frank Curzio 44:22

Another thing too, Daniel, have you seen like the departures lately in big companies? I mean, I feel like I’m reading a headline almost every day. Just a few. Domino’s Pizza CEO is going to retire.

Frank Curzio 44:34

Best Buy announces, you know, CFO just left, is going to step down and depart. Stock got hit on that. Nike CFO leaving. The new CEO only came in two years ago. Man, he hasn’t shown anything or done anything and that stock is still getting annihilated. Holy cow. Google loses two executives. OpenAI. I just feel like these are big company announcements that you see this every now and then,

Frank Curzio 44:55

but there’s just so much competition out there for these companies to go to better companies and have AI focus and growth focus because a lot of these, you know, the CFO to CEO and their packages are based on not just, you know, you get a, you know, the parachute if you get fired early and go parachute and, you know, you make a fortune anyway. These CEOs always have great deals, even basically go perform like dog shit.

Frank Curzio 45:16

And who’s that guy? It went from JC Penney.

Daniel Creech 45:20

Oh, the Apple guy?

Frank Curzio 45:21

Not Apple. I think it went from Apple and JC Penney. I mean, he just, every company he was at, he kind of destroyed, right? It was just amazing. And they’re like, and they kept hiring him. I’m like, all right, this guy just, you know, has a shitty track record. He’s making a fortune every company he leaves for destroying. And you’re seeing this massive transition. I don’t know if it’s because there’s more opportunities within AI and there’s better, you know,

Frank Curzio 45:40

there’s advantages of some of these because you’re going to get stock compensation packages, right? And options and stuff, which that’s where you really, really, really make a fortune if these stocks absolutely take off and go up 300, 400% on your tenure in three, four years. That’s where you make a fortune along with getting, you know, a nice contract. So for millions and millions of dollars. But it’s, I don’t know.

Frank Curzio 46:00

I don’t know if that bothers you. I just, I’m surprised to see it. Usually you see one here, one there, but just like the past week, just these alone, I just feel like, you know, these are just the ones I highlighted. There’s probably a lot more. I just feel like every time I’m looking, I’m like, man, there’s more departures. CFO, CEO, just tons of departures here.

Daniel Creech 46:13

Shaking things up, Frank.

Frank Curzio 46:14

Shaking it up. Shaking, shaking, shaking. Daniel Kreach, are you going to buy the new Grand Theft Auto, which finally is going to be released on November 19th, but orders start, today’s the 24th, it starts tomorrow. New orders start tomorrow. The presale. So it’s $79 for the regular version. The premium is $109.

Daniel Creech 46:36

Ooh, $109.

Frank Curzio 46:37

I think the last one was GTA V, which I have and I play, was 2013. 2013, the reason why they didn’t create another one is because this company generates hundreds of millions of sales through so many add-ons with GTA V that people still play it like absolute crazy. And these guys launched this in the middle of AI and probably changed their outlook.

Frank Curzio 46:56

It was supposed to be launched two, three years ago, four years ago, three years ago, two years ago. They confirmed November 9th several times and it’s coming out. Are you going to be buying this thing on the presale?

Daniel Creech 47:06

Well, I don’t have a console or anything, so no, I won’t be buying it. But I have looked at some of the, I don’t know if they’re trailers, but I’ve seen some pictures and some videos released. Take that with some salt. Not sure with AI if they can fake all that, but it’s going to be neat just to watch the absolute shattering of records and the amount of orders and streams of revenue and all that kind of thing.

Daniel Creech 47:27

So it’s absolutely amazing.

Daniel Creech 47:31

This is interesting to me with the AI stuff. I have no doubt that AI will be able to enhance video games, help creators, maybe even help a guy like me that is not talented at all, nor very interested, nothing against that, into creating some sort of video game. Do I think AI can help enhance that? Absolutely. If I’m take two and I could be totally wrong,

Daniel Creech 47:51

am I worried about somebody using AI to make a replacement for Grand Theft Auto? I’m not. I would like your opinion on this, Frank. I think that this is a whole building of a brand and gathering a network. It’s the same old song and dance of success. And I’m not saying that lightly because of what they do. I just, I would think they’re going to take it and run with it.

Daniel Creech 48:11

And if AI can help enhance that, they will. What do you think about all that?

Frank Curzio 48:16

I just think the presale is kind of like, I don’t know why are they doing a presale? It doesn’t make sense to me.

Daniel Creech 48:21

Marketing, Frank.

Frank Curzio 48:21

Yeah, I know marketing, but why even bother with the presale? Because this is totally going to be a digital download, right? And back in the day, it used to be a disk and based on demand and, you know, you’re selling, I mean, they generate billions of dollars, right? So say hundreds of millions of these disks, maybe, you know, you’re not going to be able to get it in time. You got to wait months. So I understand the presale and you could brag and say, I got it. Nobody else got it.

Frank Curzio 48:40

You know, it’s like, you know, when you’re selling like a new Xbox system or a Sony PlayStation, I get it, right? You’re buying that hardware. This isn’t hardware. It’s digital.

Daniel Creech 48:48

One other question. Do they even have disks anymore?

Frank Curzio 48:50

They do have disks, but this one’s going to be 100% digital. So even if they give you a box, it has a digital code in it that’s going to say, here’s your code.

Daniel Creech 48:56

Oh, okay.

Frank Curzio 48:57

To download. So why do you even have to buy it now? Unless you think the website’s going to go down. If it goes down, I’m sure the game’s not going to work. So for me, I don’t even, I don’t get it. I really don’t. But that’s fine. The presale, I understand the marketing part, but it’s different because in the past, you used to do this where, you know, the presales include disks, right? And you want to make sure you get one of those disks, right?

Frank Curzio 49:15

It’s kind of like, you know, ordering, you know, tickets from Ticketmaster, which 99.9%, I don’t know why they have the presale and you go there and they’re all gone, right? Because they’re also on the third parties and shit. It’s like this big scam that they’ll never fix, which is fine. There’s no way you’ll ever be able to go on Ticketmaster and get tickets to your concert by going on the specific time they go on sale. It’ll never happen.

Frank Curzio 49:34

Maybe one out of 25,000 happen, but it won’t happen. Trust me. Same thing here. I don’t know why they’re doing it, but the bottom line is the sales for this that you’re going to see and they have such a huge following. And, you know, people who aren’t familiar with this, they say 2013 has been so long because they enhanced the online version is so great now.

Frank Curzio 49:53

Even my daughters were playing it a lot. You know, I’m assuming they’re growing up. They’re still kind of young, 18 and 15. My 15-year-old still plays, but it’s, you know, this amazing experience that constantly adding new content at all times and it just, everyone that plays just continues to play for years and years and years. They didn’t need a new one to come out. Now they have the new one coming out finally.

Frank Curzio 50:14

And man, this is going to break every record. It’s going to be the largest selling entertainment product in history. And they include books on that. They also include movies. But wait till you see the first day sale. I don’t know if they’re going to have first day sales because there’s going to be so many presales now. But I’m interested to see how many people are going to sign up for the presale, even though you don’t need to.

Daniel Creech 50:31

So you’re buying it, obviously.

Frank Curzio 50:32

I’m going to buy it, but I’m not going to sign up like tomorrow because there’s no need to. I could just download it on my Sony PlayStation, whenever you want to, or your Xbox, whatever you have. And, you know, but interesting to see and good for take two. There’s a company I’ve recommended. I think it was $7 a share and it’s really rocking and rolling right now into this news. And we’ve had in the portfolio too. Not any more though, right?

Daniel Creech 50:54

We don’t have it currently, but we made money. And in fact, I talked to some subs at our conference last year and I think I, I don’t want to exaggerate too much, but I think I, at least two of them had under a $10 call spaces. They’ve been with it forever as well. So if I had a hat on, I’d tip it to you.

Frank Curzio 51:09

Yeah. So the highs are 264. And I mean, I covered this company back in the day. It’s a $44 billion market cap when EA tried to purchase these guys. I don’t want to say it maybe, don’t quote me on this, maybe $3, $4 billion. And it was during the 2008 credit crisis. And I think they wanted to pay, again, don’t quote me on this.

Frank Curzio 51:28

It might have been like $12, $15 a share or something. And the stock came all the way, all the way down. I mean, I don’t know if I could look at it now. And I’m like, why didn’t they accept it? They’re like, no, we’re not giving away our technology because we’re looking past this. We’re looking years down the line where our technology is absolutely amazing. And, you know, this stock is going to go through the roof. So I hit all and let me see.

Frank Curzio 51:48

This is 2000 and this is when I used to talk about it. This is back days in Kramer. But so right here, it was $7 in 2008, which is the same price it was in 2002. And I forgot where, yeah, it was like ’13, ’14 they wanted to take it over. And then during the credit crisis, it really, really came down. You know,

Frank Curzio 52:08

to the point where it looked like so many companies were going to go out of business in 2008, 2009, early 2009. And then they were like, no, we’re not taking it. And then boom, the thing just started going. And 2014, ’22, and then it was off to the races to 100 by 2017. And yeah, it’s been 200 at 2020 and then pulled back to 100.

Frank Curzio 52:27

And now it’s 230. I think the stock could absolutely go a lot, lot higher from here.

Frank Curzio 52:32

They’re going to generate, I’d be surprised they don’t generate over $10 billion on this product. I’d be surprised. They were generating billions like, you know, 2013, several billion dollars. This is going to be a huge, huge product. So pay attention to that stock. I know people might think that’s factored in. I still think that that stock has room to run based on this because the sales, it’s going to be everywhere.

Frank Curzio 52:52

And don’t ever discount that, guys, of the media. And, you know, look what they’re doing to Cerebros today, where Cerebros reported great earnings and, you know, strong across the board, strong numbers across the board. And people just seeing it for the first time being margins are coming down, that was projected, right? So that’s why you’re seeing price targets that are so much higher than what the stock is trading right now.

Frank Curzio 53:11

When take two launches, this is going to be everywhere. Every news program, financial media, everything. And that really builds up the stock because people are like, wow, look at all this news and they start buying it. I’d be surprised this thing is in 260, 275 in pretty much a month from now as it’s seeing these sales pour in, which start tomorrow. Let’s see if I’m right on that trade. I think it’s a really, really good trade. As long as the market doesn’t crash and come down tremendously.

Frank Curzio 53:30

I think, you know, buying take two is probably a good trade for a good 10, 15% pop in the stock over the next, over the next month as these sales are pouring in. You’re going to see those numbers are going to be incredible.

Daniel Creech 53:39

Yeah. And for context, I mean, we didn’t mislead. Like you said, the last one for five was released in 2013, but to your point, they’ve made upgrades and that’s what they’re going to do this. They’re just going to constantly update it and upgrade it and give you more levels, options, whatever. And it’s just going to be an absolute cash cow.

Frank Curzio 53:54

Yeah. I’m going to end this on a negative. Okay. We saw FedEx blow out the numbers and that was good. And the stock was, this is a dead stock, but FedEx from 2024 to 2026, it went from 225 to 200 in a two-year period. And now the stock is surging. It’s up 36% year to date. They figured out AI and robotics and everything and efficiencies.

Frank Curzio 54:13

I mean, up 36% year to date compared to 11% at S&P 500. But the negative part is, if you look at KB Homes and this stock, I think Daniel is up a lot today. KB Homes.

Daniel Creech 54:22

You threw me off.

Frank Curzio 54:23

Yeah. I threw you off on that. But I just wanted to mention that. It’s up 17% KB Homes. It’s obviously a short squeeze here. Probably a big short position because the stock, yeah, I mean, it was like 55 and now it’s like 61, right? Opened at like 55. So when you see this massive, it probably some short covering taking place here where people liked what the company had to say in regards,

Frank Curzio 54:44

because they missed the estimates, right? And it wasn’t really that good of a quarter, but they have a built-to-order home model, which is pretty attractive. So this way you’re not building all these homes and you have inventory where, you know, it’s almost built to order and they could build these homes so quickly that it’s like, okay, let’s wait for the orders to come in. And that’s huge, right? Otherwise, you could be sitting there on a huge inventory and now how much you pay X amount and now it’s,

Frank Curzio 55:04

you know, when you have something sitting on the market, you got to lower that price and you’re going to lose. But what was alarming to me is the average selling price for their house, it was $488, right? So it was $488,000. It’s now $461,000. I mean, you want to talk about a substantial discount. So the gross margins were 15% compared to almost 20%, right?

Frank Curzio 55:25

Primarily reflecting the price reductions, the higher relative land costs and reduced operating leverage. And people were so stuck. And I don’t, you know, maybe this, you know, look, KB Homes, it’s not a reflection. I’m not saying, you know, don’t buy the stock or buy the stock. It isn’t really about the stock. It’s about the data showing how much the home prices are declining right now.

Frank Curzio 55:42

And I feel like nobody’s really talking about that story of how hard it is in a fortibility where, you know, people are pulling homes off the market that are for sale at a record pace because they just can’t sell them right now. And you’re looking at a stock that was trading at 68, okay? And it opened today at, what did it close yesterday? Let me see if I could see that.

Frank Curzio 56:01

Previous close was 52 and now it’s at 62. Huge move, right? So that was the previous close. So it was 68 to 52. Now it’s 62. I don’t think it should be trading anywhere close to its high, which is only 10% off right now.

Frank Curzio 56:14

I’m surprised by this move with the numbers, but man, it’s to see the decline in the value of these homes right now that have been on the market. They’re declining really fast. And that’s due to higher interest rates, which people are not buying houses. When they buy houses, they spend a shitload of money within the economy, all kinds of things, appliances, cleaning products, all everything.

Frank Curzio 56:33

They fill the whole house up, new furniture, you know, so many different services and adds on. They want to make the house more personalized if it’s not new for themselves, even when it is new, you’re adding different things. And you’re not seeing that process right now. You’re not seeing it, which is a huge economic factor that’s eliminated for the market with higher interest rates. And you’re seeing it in the pricing where the average selling price is down tremendously. $461 from $488.

Frank Curzio 56:53

I mean, that’s a lot. And I’m interested to see how other home builders report because we’ve been saying, you know, nobody’s really saying how bad the housing market is. The housing market’s really terrible right now. Maybe if you’re in Florida, it’s okay. In Texas, you’re okay. But a lot of areas out there, major cities, New York is doing okay, but prices are coming down. It’s hard to sell homes right now.

Frank Curzio 57:11

People just can’t afford it with a much, much higher interest rate. And Andrew Horowitz, when I had, when he interviewed me in the podcast, and this was last week on his podcast, and he brought up a good point. If I want to buy the house next door, my mortgage is going to go, it’s the same value of the house. But if he decides to buy the house right next door to him, his mortgage is going to go up by 30,

Frank Curzio 57:31

40% at least because of the higher interest rate. If you have a current mortgage on your house, think about that. It forces you not to move, to stay where you are. And it’s also forcing a lot of homes to stay on the market for much longer. You know, and again, we’re not talking about the cash market and higher-end homes where people are just going to buy and have six, seven homes. But if you need to tap the market and take out a mortgage, man, it’s really expensive.

Frank Curzio 57:52

Throwing everything else, thank God all prices are coming down, but it’s not easy to buy a house right now. Those are confirmed in the numbers. Just surprised to see how much that stock is moving when you see this massive decline in margins. They didn’t meet the numbers, but they really like that built-to-home model, which I guess people think it’s going to do much better going forward. We’ll see.

Daniel Creech 58:09

Yeah. And there was, according to FINVIS, there’s a little over 12% short interest. So probably some short covering. And like you say, it’s all versus expectations. So they didn’t bomb it. They might have, this is showing margins stabilizing is the headline. So maybe they’re a little bit better than expected. Yeah. That ain’t my bag, but great point and great stats on the housing.

Frank Curzio 58:31

Yeah. So, all right, guys, listen, we covered a lot, a lot of stocks. Tomorrow we’re going to have a last Wall Street Unplugged premium, right? Because that portfolio has been folded into Curzio Alpha, which is really cool. So you get access to trading portfolio, access to small caps, Curzio Venture Opportunity, access to our AI portfolio, all of our AI stocks. And you should have access to everything. This way you can go different areas of the market.

Frank Curzio 58:50

Maybe AI slows a little bit, but small caps are on fire. You know, we have large cap portfolio, Curzio Research Advisory as well. Those large caps are in there. And we have a filter that you could basically, it’s a screening filter where you can click just large caps, small caps, aggressive, conservative portfolio, anything industry specific. So if you just want AI, you just want small caps, just want large caps,

Frank Curzio 59:09

you click that and it takes our whole portfolio and builds a portfolio within a portfolio for you if that’s what you want. So it’s really cool with the features, everything that we do. And again, if you’re a current subscriber to our products, you got to email. A lot of people are very happy because they have more access to everything, more access to us. Daniel and I are going to be doing, you know, weekly updates, right? And just updating the portfolio,

Frank Curzio 59:28

the markets on Fridays and what’s happening next week and stuff. And, you know, just like I’ll probably end up doing that live where people could probably ask questions and, you know, and subscribers. So it’s more interactive, more access, more stock picks for you. And, you know, that’s what we want. We want to really make sure you have access to everything we do, not just a certain sector because,

Frank Curzio 59:47

you know, you might have bought the wrong newsletter or you’re not doing that well. There’s a lot of stuff that’s doing well. There’s always a bull market somewhere. Now you’re going to have access to everything that we do. So really happy for my team that we launched that early, Curzio Alpha. So if you’re interested in learning more, go to curzioresearch.com. Other than that, we will see you tomorrow for that last issue, Wall Street Unplugged premium. And we’ll see you then. Take care.

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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.