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I'm Scott Wapner and you're listening to CNBC's Halftime Report, the podcast the most profitable hour of the trading day. We record this live weekdays at 12 Eastern. Listen in. Carl, thank you very much. Welcome to the Halftime Report. I'm Scott Wapner. Front and center this hour. The air arms race, it is heating up on multiple fronts today. Apple shaking up its leadership, OpenAI and Alphabet going toe to to trading, all of that. And of course, the other big movers in the market today with the investment committee joining me for the hour, Joe Terranova, Shannon Sokosa, Jim Labenthal, Josh Brown, we'll take you to the markets. We are green across the board today. There's a lot going on. As Carl was saying, the curve's a little steeper today. The 10 year continues to stay around for 10. And there it is right on the button. Bitcoin having a day bouncing 6%. Tech is leading and videos up. Oracle's up. Palantir is as well. Josh, the final month of this year underway. How do you see things today? So I was talking to somebody last week about what's like the most obvious thing that you think is going to happen that people still aren't expecting, even though it's obvious, like kind of joking around and the but the truth is they're going to buy these Max 7 stocks. And I know how badly people want there to be a new narrative. I know how sick and tired people are seeing the same 10 stocks at the top of the leaderboard quarter after quarter, year after year. And I understand how people went overweight. Health care and energy staples and some of the other areas that started to rally in late November as the AI story started to get a little bit shakier. But like in the end these are the biggest, most liquid stocks and contra the bubble narrative they're not even expensive. Meta is a 22 times forward Penn. Like what are we talking about? You you're going to tell me Costco at 45 is cheaper. Nvidia is the second cheapest stock in the Mag 7. It's got a forward PE now at 24 and I understand all the stories about competition etc etc not dismissing that but again this is the best company on earth and it's 24 times forward earnings a multiple you have never been able to pay for a name with with execution at this level. So I really feel judge we had this huge momentum swing on November 20th. Only 4.6% of all the names in the XLK sector Spider were above their 10 day moving average today. That's 86%. That's the highest since July. These names are being accumulated and I feel like second verse same as the first. Everyone gets how this year is going to end. I know people want a different narrative. I just don't think you're going to get it Joe. It sounds a little bit different than what you're looking for. Well I'll tell you this, I love that Josh is is targeting the conversation towards the Mag 7 because I think that's the right place for the conversation to be and I think when we turn the calendar to 26 I told you yesterday, I think 26 it's about quality not momentum. Well the mag 7 is the essence of quality. Skills up Scott and I think it's going to look very similar to what it did in 23 and 24. You know Josh is talking about consensus as you move into the end of the year. The consensus I keep hearing about is about this concentration and about the concentration being a risk and how you want to broaden out. I think that concentration remains in place in 26. Look at what is going on with the Max 7. Look at Apple. Apple is up 40% since all August 5th. Luke Capital today raises the price target from 315 to three and a quarter. I read the note they did not mention once the ability to deliver on Apple Intelligence which we know this company is behind on. So you tell me is it priced into the stock or not that they're going to succeed with Apple Intelligence? Because I'm not so sure that it is. But I'll tell you what, a lot of people want to own Apple Right here. I made it my final trade yesterday. I know Josh made his final trade last week and it continues to move. Why are you skipping past the month of December? You're talking about 2026. I think people want to know if we're going to have a pretty. Right. I mean, Josh was talking about the rest of this year. You bypass that. You just start talking about 2026. Look, I have to get your notebook back. Of all the things I say about you, you keep score. Let me write this. You'd have to write this down now because you bring it out. I hear what he's talking about here, is that. Here is the note talking about. He is talking about the Mag 7 and the Mag 7 are going to important movement. You're talking about 2026. What's going to happen December. So let me, let me respond to you by saying this. Beginning Labor Day, I said we would have a chase for performance into the end of the year. And I think we'd agree to a certain extent that we've had it. But now with we're basically less than 30 days away from the calendar turning and you're not going to like my answer. I have no idea what's going to happen here in the final three weeks of the year where liquidity is coming out of the market, where volumes are getting lower and lower, where we have all these different dynamics, like an inflation reading on Friday, a Fed meeting, maybe a hawkish cut. You've got yields rising. So I'm sorry, I don't know where we're going over the next three weeks. Are we going to complete, to chase for performance? Maybe we are. I have no idea. If we do, I'll be happy about it. But I am more focused on how do I want to think about investing in 26. He punted as bad as the Giants kicker. Oh, my God. Last night. Oh, you think it was Joe just put his foot in the ground. That was awesome. When he was. When he was approaching. I don't know where we're going in the next three weeks. Not a field goal, but nonetheless, you know where we're going in the next three weeks. Well, look here, I'm on the other side of where you are. I think I just heard you say, and I need to confirm this, that liquidity is, is getting tighter because the opposite is what I see, both with quantitative tightening coming to an end and the shutdown. I'm talking about monetary liquidity. I'm talking about the liquidity in the market itself. They're the same. They're the same. You see what's going on in crypto. You see what's going on with SoftBank. Okay, so crypto is the aberration to what I'm saying, liquidity. Let me just start with this. Liquidity has an effect on the market. Liquidity has come back to the market. All right, we had the shutdown and treasury is putting money into people's money bank accounts. Again, we had quantitative tightening and yesterday liquidity is picking up. Your point about crypto is well made. Yesterday was an aberration and you see crypto is up today. That's what it should be doing in response to both increasing liquidity and an increasing risk on sentiment, which I agree with Josh, with an asterisk. I agree with Josh that Mag 7 are absolutely going to perform going into year end. But what I'm also seeing this is the asterisk is a lot of things that have nothing to do with air. AI are performing well right now. I mean, just picking names out of a hat like Delta Airlines, Wynn Resorts, things that we talked about yesterday. But still these have nothing to do with AI. You're going to go there. It's just what I'm seeing, Scott. I mean it's not. Mag7 should do absolutely fine. Can I get a chart of overall? You go, hold on, hold on. Yeah, you definitely can, but you're going to wait. Yeah, but one year has nothing. I want to hear from what we're saying. I want to hear from Shannon who hasn't had a chance to speak yet. So we just bear with me for a minute. Shannon. I actually want to pick up on one of the points that, that Jim has been making in that the areas that are actually starting to perform a little bit better are around the consumer. I think there has been this overhang in terms of the impact of the shutdown, the impact of, you know, continued price increases, the compounding the pressure that the consumer, consumer has been under. And what I've been talking about over the last month or so has been perhaps that pressure being eased in terms of retailers, in terms of travel. We're seeing. Scott, if you want to look for other pockets of strength outside of AI, we're seeing this expectation of stronger growth next year. We're seeing the potential for perhaps a better holiday spending season. And I think that that's pervading other parts of the market where investors to both Joe and Josh and stuff point. The easy button, the proverbial easy button for AI is the, is the mega caps, right? It's the Max seven and People are going to continue to buy that. However, I think what is important is that this broadening out is starting to pick up some steam in terms of. There are areas where people have been very hesitant or residents. Well, it did in November. That's why everything but tech was, was working well. Health care, one of the areas. People were afraid to buy anything because it didn't work for a few years. There are many other sectors that, yeah, yes, the broadening out worked in November, November. But that, but that doesn't like, that doesn't refute the fact that we could still get this chase for performance to the year end. And if these, these stocks are available, why wouldn't you want to continue to buy them? Because they're willing to continue to spend, they're willing to continue to compete and they are helping, not arguing with that, are growing that footprint. And so this AI enabler trade is going to continue into 2026. What I would caution the viewers is that at some point it's going to be necessary to shift your focus to strong balance sheet cash flow, generative adopters of AI. And that's where the next phase of this trade is. So through the end of the year, because I know you're going to press me on this, I think that S&P 500 is going to perform strongly. I think that tech is going to lead the way. But I think going into 2026, if you aren't trying to figure out where the next leg of this trade is, I think you're going to be behind. Josh, you wanted what chart? I'm sorry guys, I didn't mean to try to jump in front of Shannon, but I wanted to ratify in real time something that Jim was saying because there's a universe in which both Joe and Jim are basically saying the same thing, but differently. I wanted you to pull up a one year chart of rsp. This is what the pros look at to gauge internals without worrying about data. Just give me the prices. Here are the prices. This is the equal weight s P500. All 500 components in the index have the same weight. So we're negating the impact of the Max 7. This is back at a record high. This is at the year high. This is above the breakout level from the spring we tested very briefly like a week and a half ago and now it's going to break out to a fresh high. This is every stock and when you actually look at the earnings growth away from the Mag 7 to Jim's point, there's a lot to like about the rest of the market. So me coming on here and saying, hey, guess what's going to happen yet again? They're going to buy the same 10 stocks that you're sick of hearing about. I am saying that, but not to the exclusion of what Shannon is saying and what Jim is saying about the broader trade. And the broader trade looks good. Now, I still think the Mag 7 names are some of the best names. And it's not that there isn't controversy around the theme, but I think that controversy is priced in. In videos. PG ratio. Jim, I know you love this. This metric is 0.95. Look at the top 20 largest cap market caps in the S&P 500. It is the lowest of the largest 20 companies right now. Do you know what the expected earnings growth is supposed to be year over year? 62%. So it has the highest expected earnings growth for the next four quarters and the lowest peg forward. Looking out of the 20 largest stocks in the market, what, like, what is the argument against the max seven, that there's headline risk? What are we doing here? So I think both, both ideas are correct and that's a really healthy market. The generals are going to work. And the broadening out. Look at that RSP about to make a fresh high. That's bearish. What planet are people from? But, but, you know, I think it's more nuanced as well that you could have more dispersion as we've talked about among the. The. You could, but you don't today. Well, you could. What do you mean? What do you mean you don't. I mean, there, if you look at what dispersion is, price is moving in opposite directions. The entire market in video. Well, right now, today in video had a. Didn't have a good month of, of November and a lot of these stocks didn't either. It was, it was 40%. Huh? What? 40% this year. Thank you very little. I get that, but I'm not. We're not talking about that. We're talking about you finally had some dispersion among the Mag 7 names, whereas you generally have not. Now it's been more pronounced than it ever has. You could make the case. That's one of the points. Let's hit Apple. I know it is. Let's hit Apple because it hit a record high today. Its seventh positive day and they're shaking up their whole AI leadership. Steve Kovac is following that for us and he. And he has more on that now. I don't. I guess it's probably Not a surprise given what the narrative has been correct. Yeah, that's exactly right, Scott. So let me just kind of break down what happened here. John Gianandrea, he's stepping down as the AI boss at Apple. That is not a surprise. Any Apple watcher kind of expect expected that one to happen after that big miss in delivering Siri earlier this spring. Now he is being replaced by a former Microsoft and Google executive named Amar Subramania. But there's a little bit of nuance here. It's actually a demotion for the role. He's going to actually be reporting to software chief Craig Federighi instead of CEO Tim Cook. Now, Apple is also confirming that Federighi is in charge of Siri and has been for much of the year. That follows reports that Cook actually took the project away from Jan Andrea this spring after it failed to launch. So let's talk a little bit about what this means. First of all, you have Apple struggling to find the right AI talent. Scott, we've been talking for the last four or five months about the brain drain of Apple AI executives going over to Metta and other companies. Meantime, you have the leadership turnover, the team that reports directly to Tim Cook. Jan Andrea is actually the third member of Tim Cook's leadership team to step down in just the past year. That's after CEO Jeff Williams and CFO Luca Maestri. And the most important of all, this really sets Apple up for a version of Siri to launch next year. Apple has to get this one right. And Apple in fact is framing it as a kind of reset, saying we have all the pieces in place and quote, Apple is poised to accelerate its work on air. Now, to Joe's point, a little bit earlier here, that upgrade that Loop Capital gave them, it was all about iPhone sales and projected iPhone sales next year. What we have to look for in this AI version of Siri, Scott, is whether it's good enough to get people off of chat CBT and these other chat bots. Their big sell here is going to be it takes all that private information on your iPhone, it can collate it better than ChatGPT can and do it in a more private way. They're going to have to prove that is more useful than using one of these other chat bots. There's still room for them to take some share there, Scott. All right, good stuff, Steve. Thank you. That's Steve Kovac. Joe, I guess the big question is will they use a third party provider for the LLM that's going to power Siri because that's what we previously had heard the possibility would be would it be open air, would it be anthropic? Or will they look internally and build out Apple foundation foundation, which is the LLM that would give them the opportunity to power Syria itself. That's an interesting dynamic in this story. Obviously it's more cost effective to power it internally, but with the change of leadership I'd be interested to understand what the direction is going to be moving forward on that. Yeah, Jimmy, you know, for a long time we've been talking about Apple and whether it's going to have this upgrade super cycle. We are having some sort of an upgrade grade cycle. I don't know that it's super, but it's not bad. And that seems to be enough right now to push Apple higher. You add on to it the potential for a new AI paradigm going forward with new leadership and that's why the stock is higher. Having said that, I own it. I find it hard to put new money to work in the name right now at 33 times forward earnings and estimates right now show long term earnings per share growth of seven and a half. Josh was just talking about the PEG ratio. This PEG ratio is about four and a quarter. That's just, it's really high. So all I'm saying is those estimates need to go up by a lot. This AI potentiality needs to have a meaningful impact on earnings per share estimates for the next couple of years for this to go higher from where it is now. This is, you know, obviously one, one big story but, but the other is OpenAI. Sam Altman today declaring according to the Wall Street Journal a code red versus Google and Gemini. This is interesting. Mackenzie Segalos joins us now. What does this mean? I mean is this now put Google in a position now where they have an opportunity now to beat OpenAI in any stretch. It certainly seems to signal that. So this code red warning comes from a leaked memo cited by the Journal and the information and in it Sam Altman tells staff to pause work on ads, health and shopping agents and then shift focus back to their core chatbots experience faster responses, better personalization, more reliable answers. And to your point, Scott, it is the clearest sign yet that OpenAI feels the heat from Google. So Gemini 3 it has top chat GPT on key benchmarks and helped push Gemini's monthly users from 450 to 650 million in just a few months. Altman told employees that a new reasoning model launching next week already beats Gemini. But the memo makes clear that OpenAI's moat is under real pressure here. And it's not just google deep seq. It rolled out two new models that it says matches both GPT5 and Gemini 3 on benchmarking tests. Another reminder that this leaderboard in AI is shifting in the course of weeks, not years, not even months. And all of this is coming as OpenAI is committed to $1.4 trillion in long term AI infrastructure spending. A sell that was a lot easier to investors when ChatGPT was comfortably ahead. Scott Mack, thank you. Mackenzie Seagal. Google seems to have changed the narrative with Gemini because of that launch, don't you think? I think it absolutely has. You know, we're hearing about now and just think we're going to talk in a moment about the training M3 chips from Amazon. Think about how quickly those are being introduced to the marketplace. Right. So I think you, you characterized it at the beginning of the show as this, this dynamic where you have all of these mega cap companies now kind of going at each other trying to, trying to introduce these new chips. Gemini 3 and the relationship, the potential relationship with Metta is extremely powerful. Look what it's doing to the shares of Broadcom, which is the design partner on the tensor processing units. You're seeing as they move into their earnings report. Very strong warranted appreciation because you're going to get an increase in orders as we move forward as more and more people realize the value in these Gemini 3 chips. So it's interesting. Look, I don't think, and I think it's foolish to say, well this is extremely detrimental to Nvidia. No, I just think it smooths out the opportunity. It kinds of blends it across the entirety of the Mag 7 where everyone kind of gets the slice of what really is a delicious pie. You know, Meta today had a bullish call from Evercore, which is interesting. I know you have that Amazon has unveiling their new Trainium chips, an AI model, at Invent. Their Invent conference. Josh, I'll begin with you then on, on Amazon. Yeah. I have Amazon as being one of the three most important companies in AI. I think they're right alongside of the OpenAI and all of its third party companies that, that it's working with. And then of course the Google cloud and I think like these are really the three. So Microsoft is in with the open air business. That's not going to change. Amazon to me is the one that has the least appreciation on Wall street, but potentially the most traction where it really counts with business customers. Anthropic is the biggest enterprise AI player. Like people don't even understand that because it's not going under us per se or the people that do understand that are not getting this point across to the investment community. But Anthropic really has the paying customers who were already AWB customers and has massive traction. They're not spending as much as open AI, they're not doing a press release every 15 minutes, they're not popping up on podcasts. Nobody even knows the name of the person who runs Anthropic. But they're very quietly entrenching themselves amongst corporate America and some of the biggest enterprise scale customers and they've got revenue to show for it. This idea that it's OpenAI versus Google, I think it's fun for us to talk about when, when we're looking at the stage stock prices. We don't have a stock price for either Open Air Anthropic. But I'm telling you right now, if we did, I think the Anthropic share price would be rising right now and the Open Air share price would be falling. The closest we have in terms of publicly traded proxies are Microsoft and Amazon and then of course Alphabet. But it's very much a horse race. Leadership is shifting from one month to the next. Anyone declaring that anyone won something is very quickly hit in the face with a pie. And that's just the nature of investing in an emerging technology like this this early in the game. All right, we'll take a quick break. Josh's best stocks in the market is still to come. We're back after this. And now a next level moment from AT&T business. Say you've sent out a gigantic shipment of pillows and they need to be there in time for International Sleep day. You've got AT and T5G so you're fully confident, but the vendor isn't responding. And International Sleep Day is tomorrow. Luckily, AT&T 5G lets you deal with any issues with ease. So the pillows will get delivered and everyone can sleep soundly, especially you. AT&T 5G requires a compatible plan and device coverage not available everywhere. Learn more@att.com 5G Network at Capella University, learning the right skills could make a difference. That's why our business programs teach you relevant skills you can take from the courseroom to the workplace. A different future is closer than you think with Capella University. Learn more at Capella. Edu. Looking for a new way to grow your business with TikTok for business, anything is possible if you've Ever thought about advertising on TikTok? Now's the time to do it. You can drive more customers to your website, sell products right in the app, and you can even use TikTok's creative tools to easily make content and find creators to help sell your products for you. Find new customers today. Just open your browser, type in get started.TikTok.com TikTok ads and grow your business fast. Welcome back to welcome back to the Halftime Report. I'm Seema Modi with your CNBC news update. The man accused of gunning down UnitedHealthcare CEO Brian Thompson on a Manhattan sidewalk last year is back in court today. Today is the second day of a pivotal hearing where Luigi Mangione's legal team is arguing to exclude evidence ahead of his trial, including items found in his backpack and statements he made to police during his arrest. Various law enforcement officers are expected to take the stand today. The hearings could last all week. Around 30 countries could be part of a new travel ban proposed by Homeland Security Secretary Kristi Noem yesterday. That's according to NBC News, citing a source familiar with the matter. The source says the list could expand and it's not clear which countries are included yet. And Prada says it's completed the acquisition of smaller Italian competitor versace for nearly $1.4 billion. It came on the same day as the birthday of the brand's late founder, Gianni Versace, who Versace parent company Capri holdings says the money from that deal will be used to pay down debt. Now send it over to Mike Santoli. Seema, thank you very much and welcome back to Post nine, everyone. I am Mike Santoli stepping in for Scott. Good to see you all here. Let's head it over to Josh Brown right now for an update to his best stocks in the market. Hey, Josh. Hey, what's up, Mike? We're going to do three very quickly and one of them is a throwback that I know you'll appreciate. But let's talk Morgan Stanley on November 20th. We we brought this idea to the show. It had been in a nine point drawdown from a recent record high. And we basically looked at this thing tangling with its rising 50 day and said everybody wants to talk about buying on dips. Well, here it is, one of the best stocks in the market sitting in a dip. You can have it. Obviously that is worked out well. I wanted to bring it back because if you think this rally runs into year end, all of the drivers are things that Morgan Stanley benefit from. Wealth management, asset management, trading the Investment Banking Renaissance, IPOs, M&A, they're a player in all of these things. And I think the stock price reflects that. This stock's going higher. I wanted to bring back Sienna as well Cien as Michael and and Joe and Jimmy and Shannon. Probably remember this was one of the darlings of the Internet 1.0 build out. Well, they've just become an AI darling this year as well. This is a stock that is already in a breakout and it's got a really well defined downside here. So if you look at that recent sell off when the trade got shaky, that's about 172, 173 3. That's where you set your stop. So long as she remains above. Think you want to be long. This name. You could buy as many GPUs as you want for your data center. If the infrastructure is not talking to each other, it's worthless. Sienna is that telecom infrastructure. Last name is Baker Hughes. This is oil. Oil is only 3% of the stock market at this point. Nobody cares until they care. Gold shocked the market this year. People did not expect expect gold to have the year that it had. Don't be surprised if we're not talking about oil the same way at some point next year. Nobody is long. Baker Hughes reports week after week a declining rig count at a certain point that will bottom if and when it does, this thing's going to go and it's already at record highs without any improvement in the price of crude. Any improvement in rig count. Those are the big drivers here for for this name if and when that starts to happen again. These stocks are all under owned, especially Baker Hughes. This is one of the best stocks in the market technically and I think the fundamental picture improves going into Q1. So these are all three names on my list, all doing well. And I wanted people to hear that. All right, Josh and I appreciate you. I can always count on you to just point out that I'm older than you talking about the throwback names. Although you say Baker Hughes, nobody owns it. I think think maybe Joe owns it. Can I correct my 516 little brother for a second? So we've owned Baker Hughes for quite some time now. It is up 19% as I see it year to date. It's up 12% on a one year basis. It's been a remarkably strong stock. I think Josh is right. Energy ownership is at a very low level. I would call it underweight. Baker Hughes is working also refiners working. Mike Valero, Phillips 66, Marathon Shannon Energy As a general matter, any reason besides it being under owned? Perhaps it's under owned but I also think that it's tied to the fact that there is this concern about oversupply, particularly in nat gas. But if you think about the necessary spending and the power issue that's associated with AI, natural gas is going to fuel a lot of that. And so there's an opportunity for investors who are probably under owned if they're in the index to be able to add to their positioning going into 20. And that gas actually has had a pretty good move itself and obviously exports and all the rest of it. Part of that story do to get Jim on Sienna relative to maybe something else in the group. Well, I love where Josh is with this. A similar vintage stock, Cisco. Frankly Josh, I think we have to think about these in the same breath but they both have the same fundamental drivers. Okay, but here's the thing. This appeals to whatever type of investor you are. If you're a large cap more value oriented investor, which yes, I still am, then Cisco appeals to you. On the other hand, if you're a more growthy investor in particular mid cap, yes, Sienna at about a $28 billion market cap, I do consider that mid cap, hey that's your baby. I mean the same drivers are in place here, data centers, all the AI infrastructure build out is going to benefit both stocks. So just you know, pick your horse according what type. Jim is right. Yeah, Jim is right. So Sienna is like the high beta little brother of Cisco. This company put up 29.4% revenue growth last quarter. Cisco couldn't do that if you, if you put a gun to its head. It's two totally different ways of capitalizing on the same theme and there's no reason why either one of them couldn't work. So I think it's really more a question of like how much momentum are you looking for? What kind of margin of safety do you need from an earnings multiple? But I agree with him. And how much risk is there in this part of the food chain if all of a sudden people start talking about rethinking of overall budgets or maybe it can't be all at all times a lot so. And that's where the different investing styles come into play. So if for whatever reason there was another moment where the AI capex story were in doubt or God forbid somebody canceled plans for a data center like Cisco's going down, Jim probably goes in and lowers his average cost and buy some. When I talk about the best stocks in the market, I'M not interested in them once they become not the best stocks in the market. So everything we write at CNBC Pro comes with stop losses for both traders and investors. Nobody's looking to get married to Sienna. By the way, I own this as a retail stockbroker. I built a position in this in the late 90s. It didn't end well, although the stock went up thousands of percentage points. Like the ending is never pretty. So Mike, that's a really great point and that's why we talk about risk management in the same breath as we talk about opportunity. That's it's an excellent point. And I think you have the ability to risk manage much different than you did in the 90s. And one of the ways you could do it is continue to look at where Softbank is trading. You're looking at the CDS for Oracle, you're looking at the CDS for SoftBank. It's very clear that there's hedging activity going on against the $18 billion corporate debt offering in September by those who took the other side of that trade. But soft Softbank has been on the decline now, probably about 40% since October 29th. And I think that's reflective of what Josh is talking about. The concerns that maybe there is a stumble or a bump somewhere here with this narrative as you move towards 26. Just not enough to go around. Signals are there to watch it though. Pretty healthy. The market is at least trying to figure that out. All right, up next, Joe's got a new buy plus we will debate our top calls of the day. Halftime. We'll be right back at Capella University. Learning the right skills could make a difference. That's why our business programs teach you relevant skills you can take from the course room to the workplace. A different future is closer than you think with Capella University. Learn more at Capella. Edu. Looking for a new way to grow your business? With TikTok for business, anything is possible. If you've ever thought about advertising on TikTok, now's the time to do it. You can drive more customers to your website, sell products right in the app, and you can even use TikTok's creative tools to easily make content and find creators to help sell your products for you. Find new customers today, just open your browser, type in getstarted.TikTok.com tiktokads and grow your business fast. Smarter by CNBC make it an ever expanding curriculum of career and income boosting online courses. Get 25% off all 2025 courses. Now go to CNBCMakeIt.Courses special offer ends December 5th. All right, let's hit a new move from the committee. Joe, you just bought Twilio. Tell us about it. I think the theme here is we're going old school. As Josh mentioned, this is a name that we talk about about quite a bit in 2018 through 2021 for the viewers. You remember I was advocating for it, I owned it. And it had a significant run up during the COVID period. Only to really fall on a period where you saw significant revenue growth decline. The company was growing its revenue 50, 60, 70% during that period. But what they needed to do is really diversify the multichannel. They needed to go beyond where they were, which just messaging. They needed voice, they needed email. And it's clear right now that in fact is unfolding. If you could look at a one year chart as I'm speaking, you'll see that $151 earlier this year is a significant point where you could have a potential breakout. If you get above that 15151 level. Rather you'll see if you pull the lens back over the last five years, there is a very strong Runway for this stock to move to towards $200 as we go into 2026. There's profitability on this company. The free cash flow generation is there. And looking forward, the forward p at about 2627 is a reasonable valuation that even my good friend James Labenthal would be happy with. I mean it peaked above 400. So you're talking about we have a little bit of a Runway to two. So obviously in the. What's. What's interesting. And Mike, I know you appreciate this when you, when you do pattern matching on technical breakouts, this actually screens very similar to the xpi. You know, if you just kind of say to yourself, okay, forget the fundamentals behind it, let's just look at the pattern. There's something very similar that's kind of unfolding. I don't expect you're going to get that type of similar breakout. But I do think here you've got technical forces in play and you have the return of some money managers that previously were here years ago, waited for the growth to reemerge. It has reemerged and now it's being supported by a technical breakout. I mean there are a ton of charts that look like that by the way, from 2021, right, the kind of application software mini bubble and then it's like they crash and then like a two year base and then they come to Life again. I think the one thing when you screen it out and you say to yourself, okay, it's the profitability and there is the profitability, there is the forward looking reason you mean by growing into the multiple. And honestly people don't think about when it's at 150 times earnings, but you should. And Joe, I totally endorse this. This has been teasing me for so long, I got to figure out what to do here. Well, and it's also working against at least a perceived headwind for software in general. We do have a lot of software earnings coming our way this week starting with CrowdStrike and Okta after the bell today. So I mean Joe, you own both of those. Where do they fit in? I would pay more attention to CrowdStrike. I think right, right now in cybersecurity we've really seen over the last several quarters that there has been a significant narrowing of opportunity. I think it's Palo Alto, I think it's CrowdStrike. Yes, we own OCTA in the ETF. It has underperformed. Obviously we're not happy about that position. But expanding upon there, looking at Fortinet, that's another example of where maybe cybersecurity has kind of gone sideways. So I think CrowdStrike took a little bit of a hit in the last couple of weeks because of Palo Alto and the deals that they did. They did the deal for Cyber Arc, it was a big deal. Then they did another deal for Chronosphere and the market kind of said wait a second, are you going to be a serial or Acquirer? I think CrowdStrike fell back with that. I expect a good report. Look at the operating margin. 21, 22%. That's the sweet spot. Josh, you got a thought on this one ahead of the number. You, you would be surprised, but I actually do. CrowdStrike expects 1.22 billion in revenue and if they hit that number or better, that would be 20 and a half percent year over year top line growth. Cash flow 261 million. That would be 33% year over year growth. There are not a lot of companies even within the the software software sector that are still at this stage putting up year over year growth numbers like that. CrowdStrike is very unique. Now shareholders, we've been rewarded for that. The name is of 51 on the year. It's not exactly a bargain. However, the stock is right now 9% below its 52 week high. RSI only 50. So if you've been cursing yourself for not being in the Name of Don't say nobody ever gave you an opportunity. Yeah. Just to be clear, I knew you'd have something to say about it. I was asking if you had a thought too. So it did. You did. You paid off. It backed it up a little bit. Shannon, just this, this general group in terms of security software, I always, it's funny, I've often thought about it as biotech in the sense of there are certain companies and approaches that are effective against certain things and you test them and you always have to kind of revise and develop it more. I think the challenge here is that, you know, prior to the AI explosion, we were all talking about cyber being sort of the next, you know, the next big thing. And I think that the undercurrent here is that there are going to be some winners and losers and there continues to be innovation here. But most importantly, cybersecurity isn't going away. And I think actually the use of AI compounds the need for cybersecurity. And so I think this is just an ebb and flow. Flow where cybersecurity is always going to be part of an enterprise tech stack. And, you know, it's going to ebb and flow in terms of investor sentiment. And that's what we're really working through. Right. The bad guys have it. So you've got to have. You know, Mike, you mentioned this in software, a lot of stocks that over the last five years had that precipitous parabolic move and a fallen. Back in the last week, we heard from Zoom. Yeah, I know. Josh owns Zoom. I own Zoom. I don't know if Josh is disappointed, but I'm somewhat disappointed in the performance of the stock post earnings. I would have thought there would have been stronger follow through given the conditions that you've outlined and where I'm trying to express to the viewers that there's that technical opportunity, you're not seeing it there. So, yeah, did not catch a Spark. It's a dollar. It's a dollar off its 52 week high. What do you, what, what are you looking for here? It's $5 52 week high. 5, 5. 8. What's the, what's the 52 week high? 91. 88. 91 closing high 88. All right. I mean, I think, I think it's going 100 bucks though. I'm still, I'm staying. You can see it's kind of, you know, been a ceiling for a little while here. I mean, look at it last couple of months. Okay. Yeah, yeah. All right, up next, we're taking you inside the risky 6 trillion dollar slice of the all market and what every investor needs to know about it. Robert Frank, following the Money for us next. Private lending is one of the fastest growing areas of the alternatives universe. As investors, investors seek higher yielding returns. But as some recent bankruptcies show, they can also be more risky. Robert Frank reports that now he joins us. Hey, Robert, Mike, great to see. Well, private credit as you just mentioned, has been growing rapidly and one of the biggest drivers is a little known corner of the credit business called asset backed finance or ABF. Now the ABF market has more than doubled over $6 trillion since 2006, expected to top 9 trillion by 2029. Now the big banks largely got out of the ABF business after the financial crisis, but private lenders rushed in and some say added to the risk. So rather than lending to a company based on its cash flow, asset backed loans are based on specific collateral like a warehouse or aircraft or even an income stream like music royalties. Now losses on ABF funds have typically been lower than direct lending funds, so they've been considered more safe. But then we had the first Brands Group, that's the auto parts company that went bankrupt in September. They borrowed against accounts receivable. Turns out that some of those receivables may have been pledged to more than one lender. Analysts say that with so much capital chasing these loans and all these new ABF funds being created, the risks of more blow ups could also be rising. Now for more on the ABF market and the boom in private credit, you can sign up for the Inside Alts newsletter out today at cnbc.com/insidealts that cnbc.com/inside Mike. Robert thank you, Shannon. I don't know, people might get flashbacks to other things, auction rate, securities. How concerned or, or not should we be? No, I mean I think that there are, you know, there are going to be some idiosyncratic situations that are going to create uncomfortable outcomes for investors. And so I think you want to focus on both diversification and underwriting standards. And if you think about the difference between traditional direct lending and asset backed finance, the benefit of asset backed finance is that the duration tends to be much shorter and you're getting income along the way. And so I think as a, as a method to perhaps enhance income in the portfolio so you know that it should be sized appropriately. But the reality is is that you still have to have strong underwriting and you have to be diversified regardless of what you're doing. From a private credit perspective, or a public credit perspective. So I don't, we don't see a lot of difference but we do acknowledge there, there likely are going to be some of these situations. And Jim, I just wonder about the so much money raised in a hurry by the likes of the private alternative asset manager. Hang on Jim. I think we are going to the White House where Treasury Secretary Bessant is speaking. Investment by companies, investment by countries. That is turning into a capex boom for the U.S. capital expenditures up 15% in history. When capex is up, jobs will follow. The one big beautiful bill is an incredible as you said thanks to your leadership along with Speaker Johnson, Senator Leader Thune. We had that done on July 4th which everyone said was impossible. And the great thing about that bill served for the American people. It's for industry. 100% expensing. Build your factory here, you can write it off immediately. But you also insisted on the four benefits for working people. No tax on tips, no tax on overtime, no tax on Social Security, auto deduction, affordability for American cars and that is retroactive. So as a result in 2026 we are going to see very substantial tax refunds in the first quarter. So the best way to address the affordability crisis is to give Americans more money in their pockets which is what this bill has done. We're going to see real wage increases. I think next year going to be a fantastic the gear taxes, deregulation, energy certainty. That's why everyone with your leadership is coming to America. Bond market had its best year since 2020. Everyone said couldn't be done. So we're going to have growth. We've had 2, 4% quarters before the Schumer shutdown. We're going to go back to that. So not only we're going to have great growth but it's going to be low inflationary growth and stock market obviously is following. But next year is going to be the year for Main street as all this kicks in and you came in immigration, I called it the three eyes immigration, interest rates and inflation that were killing the American people. Close the border. The promise kept. Interest rates are down and 10 year bond except again best year since 2020. And inflation led by energy prices is going to roll next year. I think it's going to be a fantastic year. We can look back, be very proud of this year. But I think 2026 is going to be great for the American people. Thanks to you. It's going to be great. Thank you very much Mr. Vice President. Thank you Mr. President. It's an honor to serve with this great team that you've assembled and I. All right, coming right up, final trades after this break. Let's check in with the broader markets. See the S&P 500 up just about 110 of 1% off its highs. Trying to rebuild off of that little wave of, you know, declines we saw on part of the Amazon news. Semis are up, though. So it seemed like they started. Everyone wanted to buy the open air complex again and decide that maybe Google was going to own it all. But, you know, Joe, we're within 100s and P points of the intraday record high, but it's been a little bit nip and tuck the past couple of days. Yeah, it seems as though it's been binary. It's either the AI trade or it's the broadening trade. Looks like to your point, today it's about AI, it's about semis, it's about software. And some of the other sectors are kind of sitting out on the sidelines on fortunately. And you know, Jim, I wonder if, you know, we got the Fed meeting next week. You do have these sort of potential air corporate catalysts stacked up in the next few days and just wonder if the market is, you know, going to digest what we did last week and wait and see. Yeah, well, I think those are positive catalysts to start with. But, you know, as I think about this is a tepid market the last couple of days and maybe that bitcoin sell off is having a little bit of an overhang here. I mean, there's a lot of leveraged players in crypto. They may be funding their losses from stock market gains. I think that passes quickly and that we get stronger footing as the weeks progress. Yeah, there's no doubt that's happening. Although, Josh Robinhood up 3% today, that's one of the tells on whether people think retail traders are still in the game. All that's. That whole wing of the market is up. MicroStrategy and the 30 weirdy tune ETFs that are connected to it, Coinbase. So I look, if you're in crypto and you're like, wait, it's down. You're not really in crypto. Well, that's true. Unless you had to sell something along the way to, you know, pad your portfolio. Josh, we're, we're up to final trades here. What do you got? Netflix? It's weird. As a shareholder, I'm reading these stories about them for some reason wanting to bid for Warner Brothers, and I'm sort of not sure if I want them to win or not. Yeah, the market's not sure either, I don't think. Right. I mean, that's why. I don't know. 10% off its high. Yeah, I'll do Oracle. Mike. I mean, I'm not saying that the ultimate bottom is in, but I do think it rallies into earnings next week. All right, financials. I think that there's a potential for recovery in some of the private equity firms as well as traditional money center banks and Joe Semi equipment names. Teradyne. I think it goes 200. 200. Gotcha. All right, guys, good to spend part of the hour with you. Thanks, Mike. That does it for halftime. The exchange starts now. You've been listening to CNBC's Halftime Report, the podcast. You can always catch us live weekdays at 12 Eastern only on CNBC. 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