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Halftime Report
Positioning your Portfolio into Mega-Cap Earnings 7/21/26
00:44:03
Leslie Picker and the Investment Committee debate how they are positioning their portfolios ahead of mega-cap earnings. Plus, the desk share their latest portfolio moves. And later, Josh Brown spotlights insurance names in his "Best Stocks in the Market." Investment Committee Disclosures
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- [00:00]
Edward Jones Financial Advisor
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Oliver Renick
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- [01:01]
Scott Wapner
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.
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Leslie Picker
Thank you Carl and welcome to the Halftime Report everybody. I'm Leslie Picker in for Scott Wapner. Today the investment committee making some key trades as stocks bounce following a three day slide. Joining me now for the hour to break down the moves, Joe Terranova, Jason Snipe, Stephanie Link and Josh Brown. Let's get a quick check on the market. The three major indexes near session highs right now, the dow up about 0.7%, the S&P about 0.8 and the NASDAQ the leader here up about 1.2%. Thanks in large part to the infrastructure trade getting a pretty significant bounce today. And I want to start with Stephanie who's made some key trades in this space recently. Steph, you tweaked your semi exposure. What brought you into the fold here?
- [02:00]
Stephanie Link
Yeah, sure. So I sold Marvell because I was up over 100%, same like I did with Teradyne. I think you take profits when you can take them. And then I added Micron because the stock is down about 24% from its highs and the fundamentals remain amazingly strong, we all know that. But I think it's going to be stronger for longer. When I went through the quarter and I've been going through the quarter report over the last couple of weeks and you know they've signed 16 deals last quarter, 14 of which it gives them $100 billion in RPO and that's bookings and I think that that means that the, the visibility is just so much better as a result. And so I do think the AI trade is certainly not over. I think we're in the third or fourth inning at this point in time and we are short memory, we are short compute. And that gives this company a lot of pricing power. I don't know if we're going to see the pricing power that we saw last quarter. I mean, they had 60% average selling prices in DRAM and 80% in NAND. But I do think you're going to see ASPs be stronger and just strong in general. And I think this company has about $40 a share in earnings power through the cycle. I also added to Nvidia, we started buying that two weeks ago. I just believe that it's lagged so much it's actually underperforming the group by 53% year to date. It trades at 18 times forward estimates. That's the cheapest it's traded at since 2019. And we know that they dominate the GPU market. I understand there's competition coming, but they will always dominate the GPU market in my mind. And they have new products coming and this is a company that's growing. Revenues in the 80s, gross margins in the 70s and they're going to double their free cash flow between now and next year, end of next year. And so I like that visibility as well. And I think there's a good value there.
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Leslie Picker
Yeah, I saw this interesting stat from OPCO this morning, guys. With Micron and Nvidia are the top two contributors to year over year earnings growth for the S and P&Q2. If these two companies were excluded, according to OpCo, the blended earnings growth rate of the S and P for Q2 would fall to 16.8% from 24.7%. That's a 790 basis point improvement. Joe, I know you own these two as well. Are these must owns just given their impact to earnings growth in Q2?
- [04:22]
Joe Terranova
Well, look, I think if you have not owned them, the right perspective to take is you now have a pullback into what is technical support.
- [04:30]
Leslie Picker
Well, you think microns up 10% today, right?
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Joe Terranova
And you're technically, you're still sitting above the 100 day moving average. I think the fundamentals are well known about memory, high bandwidth memory and the universe of AI infrastructure. We know hyperscalers will continue to spend and they are ultimately going to benefit. I think from a sentiment, positioning standpoint they reached an extreme. They went parabolic and you need to work, you needed to work off that overbought type of condition and I think that's in fact what you've done. So if you do not have a position, you have what I would call a low risk, well defined point of entry here versus these critical supportive moving averages. If they break down below it, then you can make a strong argument that maybe there was a significant inflection point that was traced out several weeks ago. But I hold them from a core perspective in the etf. I'm not adding to them here because I do think we've worked off the significant fever and I think overall you've seen the momentum factor come down dramatically this month. Okay, one of the worst months for the momentum factor in the last 10 years. And it seems to me you have a little bit of a handoff and what's saving the market is the performance of the Mega Cap. It's your Apple, it's your Meta, it's your Amazon, they're performing Nvidia, they're all performing really well in July and I think that handoff might continue. So I'm a little bit muted in terms of how I think about positioning. If you're there, stay there. If you're not there, lowest point of reference. Don't get overly excited about a trade that probably saw its most strongest intensity several weeks ago.
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Leslie Picker
Well, I guess the key question too, Josh, is whether this is a factor unwind in terms of momentum and a lot of the infrastructure exposure. Exposure or a fundamental unwind. This is a question that Wells Fargo was asking this morning and if it is purely factor based and positioning based, do you feel like that unwind is, is to a point now where it's completely been flushed out?
- [06:28]
Josh Brown
Well, the market, it doesn't matter what I think because the market is telling you that they bought that, they're buying the dip and they think that most of what went on was technical and not fundamental. That's why the entire trade is ripping today. Not just the semis but all the non technology companies that have been caught up in this whole AI CapEx build out theme. They're all, they're all up. DRAM's up 10% today. The top performing stocks in the S and P, Sienna, Sandisk, Western, Digital, Micron, intel, amd, Corning. So it's all one trade. The trade got washed out this month. Joe made a really good point, I think. And we had this handoff underneath the surface of the market that allowed us to not give up too much ground in the, in the S and P at the index level. And the market today is telling you they want to Be long these names now why today? This is the thing that nobody's brought up yet. If you're bullish on the steam, you can't not be in these stocks ahead of Google. Because what the Google, what the Google earnings report does for us every quarter is it serves as this sort of like come on into the revival tent for Brother Love's traveling salvation show. It's the affirmation that everybody needs to hear about the state of CapEx, the forward guide for CapEx, the fact that all these projects are going ahead, maybe even more projects than we thought about 90 days ago the last time they reported. So like if you, if you're bullish, you need to be in ahead of Google, not sitting on the sideline because this is arguably the cleanest story in the entire market from the, the hyper, from a hyperscaler perspective. I also think, you know, it's a, it's a really healthy tape. The fact that we had these stocks, 20, 30% drawdowns, you would have thought, oh no, now the whole market's going to sell off because it lost its leadership. Number one, that didn't happen. And number two, this has been a really helpful reminder for traders. Ain't no such thing as one way trades. It doesn't exist. The best stocks in the market, the most powerful names, the best earnings stories, they're going to have down days, they're going to have down weeks or even a down month on the way toward higher prices. We need to get that reminder. If they just go parabolic every single day the market opens, then you're in for a real crash. And fortunately this is what keeps the market honest. This unwinds some of the leverage. This gets people to actually hit the sell button on some of these two X ETFs, like this is what you need for a longer term uptrend. So I'm really pleased with the way not only these stocks are rebounding, but the way the overall market is processing what's happening and living through it.
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Leslie Picker
That's a really good point. With regard to Alphabet earnings and the timing.
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Josh Brown
I am very good at this.
- [09:23]
Leslie Picker
Yeah, you got some experience there also in kind of the fundamental camp of why we're seeing semiconductor stocks move higher. Today you've got Taiwan June export orders that were kind of skyrocketing. TSMC reportedly looking to raise prices 10% next year. That's according to Nikkei. So I guess the question is, given what we've seen in terms of positioning, given some of the fundamental stories that we're digging through Today and Josh's point about Alphabet earnings, do you think these moves hold?
- [09:55]
Jason Snipe
I do, I do and I think all, all that's what's transpired thus far. This is a matter of positioning from my standpoint obviously the SOX or the smh, whichever index you've been on the semi side have run to Josh's point, I mean they've been parabolic runs that we've seen in the first half and it is healthy to see other sectors participating like health care, financials, industrials starting to move. And I think to Joe's point, if you're not in there, this is a potential opportunity because to your, to your point Leslie, at the top of the show, you know 48% of earnings growth is going to come from the semiconductor index going forward. So there's clear visibility on what those profits look like. Capex is not going to slow down. You're going to hear that from Google tomorrow. They'll reaffirm and potentially raise. I think you're going to hear that from most of the hyperscalers. So I think that is not a place to ignore. And this kind of disruption that we've seen over the last couple of weeks I think present an opportunity. If you're not there, how should we
- [10:52]
Leslie Picker
think about capex and especially against this backdrop of the Chinese model competition, how critical is OpenAI and anthropic in light of that competition to fueling the massive capex build out? Do you think it still continues to. If there is significant open source competition from China that starts to eat away its share of anthropic and open air? Is it, is it as much of a correlation as you know, the broader narrative may think right now?
- [11:18]
Jason Snipe
So I think it's, it's an interesting story. It's kind of like a mini deep seat moment that we experienced a little over a year and a half ago. I don't think that slows down that the, the, all the octane and the fuel in that trade. I think the capex story continues to be a reaffirmed and, and move forward but I do think we might see some discipline in the next few quarters. Right. I think, I think this is good from a disruption perspective. Listen, it's a China based company. We're not going to be investing heavily in that direction but I think it, it is a story that maybe changes the dynamics from firms going forward and how they manage this narrative. So I don't, but I don't think it changes the capex.
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Joe Terranova
So I don't know that the memory names or semi Semi equipment names. They want that discipline in capex. They want to see the capex continue.
- [12:09]
Edward Jones Financial Advisor
Right.
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Joe Terranova
I think the capex is really important tomorrow night for Alphabet because it makes you think about two things. If the hyperscalers continue to increase capex, what's the effect on free cash flow? We know the obvious answer to that. Does it look so good? And then what's the effect on buybacks? So does that story change for the mega caps? Now to Josh's point, you have the first pure example of monetization tomorrow night with Alphabet and it comes in the form of cloud. So consensus said 63% growth for cloud.
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Stephanie Link
Right.
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Joe Terranova
The whisper number is 70% for cloud. I think it's going to be interesting tomorrow night because of the TPUs tensor processing units. So does that mean that Alphabet benefits from maybe not having to spend as much because they have the internal usage of these chips that maybe some of the hyperscalers aren't? So I think tomorrow night is really going to be one of the more interesting Mega Cap earnings reports. It's going to set the stage, it's going to set the tone for memory, it's going to set the tone for semi equipment. But I think it's all also going to set the tone for whether this rotation into the Mega Caps can extend itself further.
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Leslie Picker
Jason, what are you expecting tomorrow?
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Jason Snipe
Yeah, no, I think the cloud number is very important number to kind of extract there because even last quarter was just, I mean a blowout 60 plus percent, you know, revenue growth number. So that I'm definitely following. I think, you know, search and ads still are the core bar.
- [13:43]
Joe Terranova
Right.
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Jason Snipe
I think that's going to be important. Revenue growth of around 21% we're expected to see. But I think if we can get close to that Whisper Number of 70% that's going to be the story as Google Cloud continues to get market share in the space. Right. US has been that has been the largest player here but they're continuing to get market share and Azure and others. So I like this story. I like that vertical integration, the full circle.
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Leslie Picker
Hey Leslie Stack.
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Brandon Gomez
You got it.
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Leslie Picker
We've got some headlines coming out on Apple. Let's get to Mackenzie Sagalos with those. Hey Matt.
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Mackenzie Sagalos
Hey Leslie. So Apple reportedly launching a new leasing program with Klarna. They are calling it Apple Upgrade and it apparently launches a week from today. That's according to Bloomberg. Now this would be one of the most significant changes yet to how Apple handle sales. I am out to Apple and Klarna on this but the report says the Klarna backed service will cover most iPhones, Macs, iPads and Apple watches both online and in US Stores. Customers would essentially make monthly payments into the program. It would also let them upgrade their device early. And of course this comes right after Apple raised prices by around 20% across several products like the Mac and iPad lineup with iPhone hikes also expected this fall. Leasing lets Apple shift the focus from a higher sticker price to a lower monthly payment. Apple had previously looked at its own in house hardware subscription program according to a report, but canceled that plan two years ago. Partnering with Klarna really gives Apple the same kind of sales tool that they had been looking to offer without having to single handedly shoulder all the financial risk that comes with it. Now I will say shares of Klarna, they're getting a boost on this 2 1/2 percent. Apple shares also higher. But I'm looking at shares of a firm as well that is Klarna's chief rival, they're trading lower. They've been Apple's go to BNPL provider through Apple Pay. So I'm sure investors want to understand why they aren't working with Apple on this new leasing program.
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Stephanie Link
Leslie?
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Leslie Picker
Yeah, yeah, that would be an important partner for Klarna. Mackenzie, thank you so much. Josh, I want to get your take. Does this type of partnership attenuate some of the concerns surrounding the price hikes that Apple has been doing? Does it help the consumer picture for them on the demand side?
- [15:56]
Josh Brown
Yeah, look, I think what the consumer is going to be wanting a year from now is, is way, way less interaction manually with all the apps on their phone. They're just going to become so right now what's happening is everybody is becoming accustomed to just having on demand information. Whether you're using Claude or you're using Gemini or you're using Chat, cbt. Just this ability, ask a question, get an instant answer. It's partly replacing search in Google's case, it's actually augmenting the searches that would otherwise have happened in a plain vanilla way. They're now becoming more assisted searches with AI. But regardless, this is a behavioral change and Apple knows what's going to come after this. Why do I have to ask questions? Why can't I give commands? So people who are working in coding are already fully having all of that workflow happening on a command by command basis when they're using either Codex or Claude code. The normies, the regular people, they're not quite there yet. But Apple is trying to get ahead of that and so Having an agent experience on your iPhone, telling it to pay for something, telling it to order your favorite thing from Starbucks, telling it to send money from your bank account to two friends because you're all going to a concert together, telling it to book a flight, telling it to arrange a hotel. That's the experience that Apple is trying to get ahead of here. So this is like one micro example on the, on the payment side or, or on, on, on the new phone side. But like the bigger picture is a gentic Siri and an iOS where all of the apps are forced to talk to AI and implement the things that the users are telling them to implement. This is coming so quickly people don't even understand. I think we'll get a glimpse of it on September 1st. This is when John Ternus takes over officially. I know that's the date that people expect them to roll out the foldable phone. I don't think they're going to not talk about. I obviously doesn't mean we'll get the product on that date. But everything happening with the Apple share price in the last couple of weeks which we've been pounding the table on on the show, has to do with that. The expectation of the consumer in 2027 is what Apple has to spend the rest of 2026 preparing for.
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Leslie Picker
Yeah, it sounds like good news for us normies out there. I consider myself one of those. But I have to wonder what it means for software staff as we think about this. This morning we saw Morgan Stanley downgrading Salesforce in Adobe asking the question when does a willingness to disrupt itself play out? But they do think that the market has become too negative on software overall with key weight key overweight Microsoft, Palo Alto, Net Networks, CrowdStrike, Cloudflare, ServiceNow. I know, Steph, you own Palo Alto, CrowdStrike and ServiceNow. Curious where you think we are in terms of software.
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Stephanie Link
I have the most conviction in cybersecurity and I have for the last three years because of I, I have said many times I think cybersecurity is bigger than AI because of AI. It is not secure and we're doing more and more AI coding and that makes it more dangerous. And so these companies really, they, the cybersecurity companies fell in February and March with the rest of software, which I thought was silly and I was buying but by the way, so were the CEOs. Both CEOs of CrowdStrike and Palo Alto bought a bunch of shares and it's because they see that their business is not disrupted at all in Fact, it's accelerating. Why I think Palo Alto has rerated is because we couldn't really figure out the inorganic growth and the, and the organic growth because they've done a lot of acquisitions, $30 billion in the last six months. And so now they're breaking it out. And now you can see the net new next year Shen Security, annualized recurring revenues and where they're coming from and where it can accelerate to. In terms of the other ones that I own, I mean Snowflake, they have a whole new product cycle story and they are growing and seeing an acceleration because of these new products and more migration to the workloads and you need safe and secure data and that's what they provide. And so I think they're going to continue to see product revenue growth in the 30s with operating margins gradually expanding. And then I would just simply say ServiceNow is the one that is down and out. It's a lot of down and outers, but this one is down and out. But this is a mission critical Software platform. And 50% of their net new business is consumption based and infrastructure based. And so I think it's a buy here. It's 24 times forward estimates growing 20% compounded annually. And I think you will see I help their business over time. It's a show me story, but I kind of like the show me stories with great leadership.
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Leslie Picker
I want to ask you about areas outside of tech as well. Barclays said that the flows are moving. They're not de risking out of tech, they're just going into different sectors, financials and health care. You actually bought more Morgan Stanley last week, I'm assuming on the heels of their earnings report.
- [21:20]
Stephanie Link
Yeah, I mean the Stock was down 7% from its highs when they reported a blowout quarter. I mean this company is doing everything right. Leslie, you know this better than I because you follow this beat, but total revenues of 27%. Investment banking growth of 58%, trading up 69%. Wealth management is really a challenging business and they're they grew at 14% but most importantly, this is the second quarter in a row where their ROTC exceeded expectations and came in close to 27% industry high. And that is really very powerful and speaks to the strong execution that this company is delivering. And so I just kind of thought down 7%. I want to make it bigger and because I don't think that capital markets are closed by any means. In fact, I think they're going to stay quite strong and the momentum will be at their back.
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Leslie Picker
Yeah, Goldman had A report out this morning, Joe, saying that they estimate 489 billion in AI related debt finance financing across investment grade high yield and leveraged loan markets globally. Well above the full year estimate for 2025 of 322 billion. So it's only, it's only July and it's already 489 billion. And Morgan Stanley and Gold, Goldman are perceived as some key winners here alongside maybe JP Morgan and Bank of America and others as well. Goldman was upgraded to a hold from a reduced HSBC today. You own Goldman.
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Mike Santoli
Yeah.
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Leslie Picker
How big of a beneficiary do you feel like these big investment banks and capital market sensitive firms will be in this huge financing buildout?
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Joe Terranova
The way I see it, I could be wrong. I believe they're in the sweet spot. And Goldman Sachs is a position I've maintained for the better part of the last two years. Leslie, as you know, there was a lot of excitement surrounding the financial sector, in particular for money center banks coming into the year. And then we had the disappointment of the spring. They reported really strong earnings in April and they just didn't respond. I think a lot of people at that time kind of left and went to the sidelines. We're rebuilding positioning now as I think we're understanding from these early earnings. We're in the midst of a paradigm shift. A paradigm shift to where we've never seen the type of engagement that we are seeing in the capital markets, whether it's from retail, whether it's from equity flow, absent the volatility, or whether it's from a lot of these companies who are out seeking capital in the debt market and then also through M and A and ipo. So the, the benefit is clearly going to be towards names like Goldman Sachs. You had Charles Schwab, which reported. You and I talked about that yesterday. Record quarter, record retail flow. Yes, the expectations. Why? Excuse me. So subsequent to that, you didn't see the price performance today that maybe you wanted out of Charles Schwab. But if you're long, you're not leaving that position. With $13 trillion in retail and RIA capital that's sitting there at Charles Schwab. And the understanding it's a record quarter and you have this record engagement. So I think it speaks to the benefit of the sector overall. And in the month of July, excluding energy, there it is. Financials, they are your best sector in July, up 4%.
- [24:35]
Leslie Picker
Jason, do you think that this dynamic has already been priced into these names at this point because there was so much dialogue on the earnings call Just about the role that they're playing in this financing of the capex. Is this something the market fully appreciates or do you think that this is still maybe early innings?
- [24:54]
Jason Snipe
Yeah, no, I still think there's room to run. As I kind of followed obviously the Goldman Sachs release, which is a tremendous release, you know, investment banking revenue was up 55% year over year to Joe's point. Trading up 72% year over year. I mean the stock moves 7% post a print. It's up 22% year to date. I think, you know, as we walk into a new cycle with a new chair as Fed, you know, new Fed chair and Kevin wars, you know, tougher Fed, more hawkish tone, you know. And as I see the conflict potentially wrapping up towards the end of the year and look to next year, I think this, I think the opportunity only gets larger for, for IPOs and, and trading revenue with just more participants in the market. I think that's exciting for banks like Goldman Sachs and many others. Morgan Stanley.
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Leslie Picker
Yeah, more tilted toward it. Josh, you sold some Nike as well?
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Josh Brown
Yeah, you know what, I bought it before the earnings. The earnings were not terrible. The stock fell at first and then came all the way back. But then it just kind of was sitting there and I looked at my portfolio and I just had other things that I thought were a little bit more urgent, other opportunities. So I may return to Nike. I do think they've just reported the last of the horrible quarters and the quarters coming from here on out will probably just be bad and not horrible. The good news is the market still expects horrible given the price action. So I do think that there will be upside in Nike and I haven't fully walked away from it. But for right now I just had other things that I wanted to do with a higher priority.
- [26:34]
Leslie Picker
What was the higher priority?
- [26:37]
Josh Brown
To be discussed later.
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Leslie Picker
All right, looking forward to it. Still ahead, more of today's top movers including the pop in Space X as it tries to snap a seven day losing streak up about 6% right now. And later, Josh Brown is back with his best stocks in this market. He's highlighting three under the radar winners that have been breaking out. Halftime is back in two minutes.
- [27:04]
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- [28:03]
Leslie Picker
What made you confident that you could
- [28:05]
Stephanie Link
do something that hadn't been done before?
- [28:07]
Leslie Picker
I have no fear of failure.
- [28:09]
Julia Boorstin
Trailblazing women, changing the game One of
- [28:12]
Stephanie Link
my favorite pieces of advice, Think about what your boss's boss needs.
- [28:17]
Leslie Picker
Leadership can look in many, many different forms. It really does come down to just trusting yourself. Life is short and you just gotta think big to accomplish big things.
- [28:25]
Julia Boorstin
Julia Boorstin hosts CNBC Changemakers and Power Players. New episodes every Tuesday, wherever you get your podcasts.
- [28:46]
Leslie Picker
Welcome back. Let's get to subcommittee. Stocks on the move today. Novo Nordisk suing Eli Lilly over what they call misleading GLP1 advertising. Lilly up about 1.3%. Novo down slightly today. Joe, you own Lilly. What do you make of these allegations?
- [29:02]
Joe Terranova
Okay, so from a legal standpoint, I'm not an attorney. I don't play one on TV and I have no desire to be one. Maybe potentially Novo wins the case. From the perspective of a shareholder, if you want to step in and buy Novo on this news, legal action is not how you regain market share. That's not the strategy to get back your market share. You were there first with Wegovy. Lilly stepped in with Zepbound and completely
- [29:30]
Josh Brown
blew you out of the water.
- [29:31]
Joe Terranova
It was like the Yankees and the Dodgers the other night and the Dodgers blew the Yankees out. I was there. Okay, the revenue year on year for Lilly in the last year is up 50%. The revenue for Novo is down 10%. So stay with your Lilly position. Don't believe that this is going to change something for Novo. They have to recapture the market share opportunity that they lost. I'm not sure how they do that, but it's not through the court.
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Leslie Picker
How big of a role did advertising play in Lilly's ability to blow them out of the water? How big of a supplement was it for the Yankees?
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Joe Terranova
First of all, the commercial in Question is recent. It's a recent, a recent commercial and it's challenging the dosage levels. Okay. So now the dosage level, I'm not an attorney, so the dosage level in WeGovy now is higher. So there's more effects. So they're making the comparison. They might be right in that regard, but that's not a reason to go by the stock to believe that that's going to turn around your market share.
- [30:29]
Leslie Picker
Yeah. Fascinating story today, Dr. Horton lowering its revenue guidance. Jason, this is when you own.
- [30:36]
Jason Snipe
Yeah, yeah. So I mean affordability is their story and obviously that's, that's a challenging narrative in this, in this climate that we're currently in. You know, with 30 year mortgage rates at 6.6%, that's going to be a tough story. So lowering the guide kind of makes sense. The stock is trading flat for the year. I mean there's, you know, as we look forward it's, the story is a bit murky but I'm willing to be patient on this one and kind of turn the corner into 2027 as an opportunity here. But you know, I think eventually this will kind of break through.
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Leslie Picker
Yeah, basically a sideways stock in 2026. Space X on the other hand rallying today up about six and a half percent to snap a seven day losing streak. Macquarie says the SpaceX story is in the right orbit. Staff. We also got the date of the first quarter of earnings since going public and that also is indicative of when we could see the lock off releases come a few days after that. So are you kind of surprised by this reaction?
- [31:39]
Stephanie Link
Well, no. I mean the stock has been in freefall since it peaked a couple of weeks ago. The way I view this story, Leslie, is, is I bought a small position and I'm putting it aside and I'm just going to hold on to it for a very long time. And I'm not going to get caught up in the price volatility because I do expect the volatility to continue. There's three ways this company can win and they have a leader that is the best in the world. They have in space. Last year they actually did 170 missions and with a 99 success rate and their costs are coming down dramatically. StarLink is the second way they can win. That's their profit generator. Gross margins are running at 48%, operating margins at 39%. They have 10 million subscribers. I think that could get to 200 by 2030. And then of course they're renting out. Compute. They signed three deals worth $27 billion this year. And I think that number you're going to see on an annualized basis get to 60 billion per year over time. So I think there's a lot of ways to work win. You've got to be patient with the volatility, but I'm sticking with it.
- [32:42]
Leslie Picker
Yeah. There's such a big gap between what analysts are saying and what the stock is doing. It's certainly an interesting one to watch.
- [32:47]
Stephanie Link
Yeah.
- [32:48]
Leslie Picker
Live Nation is another one that is was downgraded at Susquehanna on a concentrated third quarter schedule, which they say leaves little room for error. Josh?
- [33:00]
Josh Brown
Yeah, Look, I think this is, this is the kind of thing that investors on a regular basis are just going to have to get used to. Like you're going to get down to it when you I own the stock for so many years. When you own a stock for a long period of time, there are people looking for tactical opportunities to buy and sell. And you'll just see like changes in opinion, changes in price target. You're not forced to react to them. So I think it's interesting information. I think I added to the list of things that I'm paying attention to with the stock and then I do absolutely nothing with it. And this is a name that just continues to barrel ahead to new highs. Summer after summer, their business improves. And I want to stay look at this chart. So look at how many times you had an opportunity to react to a sell side note or not or not react at all. And that's the path that I've chosen here.
- [33:51]
Leslie Picker
Yeah. Consumer experience is still very much in focus. Up next, Mike Santoli joins us with his midday word.
- [34:01]
Mike Santoli
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Wayfair Advertiser
Most of us are one good deal away from finally replacing that worn out rug, fixing up the backyard or getting the bedroom we actually want.
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Edward Jones Financial Advisor
Good news.
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Wayfair Advertiser
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- [34:45]
Leslie Picker
What made you confident that you could
- [34:47]
Stephanie Link
do something that hadn't been done before?
- [34:49]
Leslie Picker
I have no fear of failure to trailblazing women.
- [34:52]
Stephanie Link
Changing the game one of my favorite pieces of advice. Think about what your boss's boss needs. Leadership can look in many, many different forms.
- [35:01]
Leslie Picker
It really does come down to just trusting yourself. Life is short and you just gotta
- [35:05]
Stephanie Link
think big to accomplish big things.
- [35:07]
Julia Boorstin
Julia Boorstin hosts CNBC Changemakers and Power Players. New episodes every Tuesday. Wherever you get your podcasts,
- [35:18]
Brandon Gomez
We're back on Halftime report. I'm Brandon Gomez with the CNBC News Update. The Gates foundation revealing that an external review found no evidence of payments to Jeffrey Epstein. The DOJ had released emails between Epstein and Gates foundation staff and the foundation says that a small number of foundation employees interacted with Epstein, who was trying to secure potential funding. But no fund was ever created. French senators approved a social media ban for children under the age of 15 and the lower house of parliament may adopt the legislation later today. If approved, children under 15 would not be allowed to sign up for social media accounts starting September 1st. And social media platforms would have another four months to close. Accounts already open. And Tropical Storm Bertha is strengthening in the Gulf of Mexico as it slowly turns towards the Florida Panhandle in Alabama. The second storm of this year's Atlantic hurricane season is expected to produce 2 to 4 inches of rain and isolated totals of 8 inches through Friday along the Gulf of Mexico. As of this morning, the storm had since sustained winds of 50 miles per hour. Leslie, send things back to you.
- [36:20]
Leslie Picker
Thank you, Brandon. Yeah, bracing for another storm up here in the Northeast as well. Senior markets commentator and overtime co anchor Mike Santoli joins us with his midday word. You got semi bouncing. Question is whether this can actually hold or if we're going to continue to see this back and forth rotation.
- [36:36]
Mike Santoli
Yeah. Reloading yesterday's attempted rally in the group, it did kind of have a decent morning and then fake. And it does seem like there's a little more behind it. Today I was looking at the the 10 worst performing s and P stocks on a quarter to date basis. That's June 30th. They're all up like an average of 5 or 6% today. And that's basically semis plus Caterpillar plus Tesla. So that suggests a little bit of squaring up. And let's not get too negative into the meat of earnings season. I do think it's still very evident that when semis are up, something else has to be down. And so you do still have this dynamic where the other like hyperscaler stocks are kind of, you know, weaker and it's this back and forth equal weighted S and P is not up nearly as much as the market cap weighted, I don't think it's a problem but I think it tells you that it's the dispersion that's just sort of being forced on this market on a day to day basis. And it's not something that necessarily is, is kind of ebbing and flowing even with macro information.
- [37:32]
Leslie Picker
How when was last time you saw something like that happen? Was it mag 7 where you just get the market?
- [37:39]
Mike Santoli
Right. So I mean some of it is just an outgrowth of the concentration. Right. So the fact that semis are 18% of the S and P market cap means they can do one thing while the rest of the market does another. And the index as a whole, it kind of just hangs out there in
- [37:52]
Joe Terranova
the middle like the, it looks as though the market's just dismissing completely the move and yield yields pushing towards highs the last several years. When you get that push higher in yields and ultimately the market breaks, the return to concentration comes back once again. Isn't that the experience?
- [38:09]
Mike Santoli
No, totally. I mean I always said the broadening trade kind of operates with the permission of the bond market. Right. So you usually need to have yields in retreat, you have to have oil in check. We'll see if that's the case. I wonder sometimes if the thresholds get checked change in terms of what absolute yield level is going to matter. But you know, two year back to four and a quarter, you're barely down at all since you had those really reassuring inflation prints from last week and it's, you know, it's 50 basis points above where fed funds it. So we're back to this mode of saying, I guess the bond market thinks that there's going to be hikes. Whether that matters for the market or not, who knows? Because if, if we're going to just play semi earnings momentum or hyperscaler rebound, it almost is impervious to those things.
- [38:52]
Leslie Picker
Yeah, good point. The cross asset allocation element is not as in focus as we are with semis versus kind of everything else. Thank you, Mike. Up next, Josh Brown's ready with his best stocks in the market. We're back with Josh Brown's best stocks in the market. Josh, what are you focused on today?
- [39:28]
Josh Brown
I don't know why Leslie, but this is always my favorite segment of the show. We are going to talk about, we are going to talk about one of the most exciting cutting edge areas in all the world, insurance. I don't know if you guys know this. I feel like Joe might. 85% of the KIE. That's the Insurance Subsector ETF. 85% of the names that ETF are above their 50 day moving averages. These stocks are absolutely on fire. They are. Give me a little bit longer than that. They are outpacing the rest of the excess LF subsectors, the rest of the market. They look better than the banks, they look better than the credit cards. It's just this confluence of events. We didn't have a lot of weather catastrophes this summer. We see premiums going up, we see profitability improved. And don't forget, a lot of these companies are de facto investing businesses and they are investing at higher rates and getting better returns in their stock portfolio. So there will be working. We wrote about travelers on June 11. It was an absolute home run for viewers of the Halftime report. We called it a case study on how insurance companies are implementing AI and improving their bottom line results. The stock's up 22% since we did it here on the show, which is actually double the kie. So it is a leader in the space. I want to talk about. But we did that one already. So I want to talk about Chubb right now. Chubb is very much an international business. They've been growing premium net premiums by 14 and a half percent. Consumer lines are up 20 and a half percent. Life insurance business is up 33%. And there's a lot of activity from Asia to North America. The board just raised the dividend in May to 5.2%. By 5.2% sets a $4.08 annual payout is the 33rd consecutive annual increase, which makes this a dividend aristocrat. Not a big yield, but an important signal as far as quality company reports. Tonight the street wants to see 13 billion in revenue which would be up 5% year over year. $6.74 in earnings, which would be up 10% year over year. Management has already given pretty good guidance for this year, but so we'll see if there's an uptick. You got an RSI in this stock of about 57, right in the middle of the range. Still room to run real quick. I want to do Aflac too. This is a Japanese powered business, which we all know the CEO is not a duck. It's a very successful company. It's been publicly traded for a long time. This is one of the biggest winners in the S and P over the very long term. They're also returning cash capital to shareholders at a rapid rate. 1.3 billion in Q1 between buybacks and dividends. You got a dividend yield of about 2% here. They're going to report in early August. This is I think a 65 RSI right now, which getting toward overbought, but not quite overbought. You could see it's been a relentless uptrend and the stock has been obeying its, its 200 day almost the entire way up. So we like these two names. They're on our list of best stocks in the market and they're not. I, they're very much living in their own lane and earnings are growing and I think they should be on people's radars.
- [42:57]
Leslie Picker
Yeah, definitely under the radar. Nice job. I learned something there. Thanks, Josh. Coming up, options action. Oliver Renick is following the move higher in bitcoin. Halftime is back after this.
- [43:13]
Mackenzie Sagalos
Welcome back.
- [43:13]
Leslie Picker
Let's get to today's options action. Our Oliver Renick is live at CBO Global Markets in Chicago with more. Hey, Oliver.
- [43:22]
Oliver Renick
Hey, Leslie. If you're looking for clues on the direction of the market, a steady climb in crypto prices and related stocks might suggest a firming of risk appetite. Bitcoin's up almost $10,000 the past three weeks. While stocks have been chopping sideways and options flows in, pretty much every corner of crypto look quite bullish compared to the rest of the market. In the bitcoin etf, IBIT call volumes, double puts and in strategy, traders are selling puts and buying calls. But in Coinbase, we see a strong bullish bias after a 13% rally today as the stock bounces off a multi year low around $150. Of the 130,000 options traded in Coinbase today, 90 are calls with traders buying seven times as many calls as puts. The most popular contract by volume right now is the 190 strike call expiring Friday. That needs a 7 1/2% rally to pay off by the end of the week.
- [44:18]
Josh Brown
Leslie.
- [44:19]
Leslie Picker
All right, Oliver, thanks for staying all over it. Oliver Renick, step. You own Coinbase, right?
- [44:26]
Stephanie Link
Yeah, I do. It's a, it's a small position. I have no idea what's going to happen with the price price of bitcoin on a day to day basis. Quite frankly, I don't think anybody really does other than it is a risk on asset. But I actually like Coinbase because you need a buyer and a seller not necessarily determining on the price, the underlying price of bitcoin. But also they've also, they've also been diversifying into other businesses as well, which I applaud. But it trades with the underlying asset and today is a good day. After a bad couple of months.
- [44:56]
Wayfair Advertiser
Yeah.
- [44:57]
Leslie Picker
Down 59%, I believe, from its 52 week high last July. Josh, you own Bitcoin, right?
- [45:05]
Josh Brown
Yes. Some days I'm really excited that I own it and some days I don't even look at it. So I guess I'm like everybody else in, in crypto land. I don't really have any idea. If you told me it's going to 56,000 or it's going to 76,000, I wouldn't argue. I couldn't tell you. Just, I want to, I want to point out I'm in it since 2017, so I'm almost an OG. Not quite.
- [45:33]
Jason Snipe
Wow.
- [45:33]
Leslie Picker
Well, there you go. It's up 2.3% today. Still down about 24% year to date, though.
- [45:38]
EY Parthenon Representative
Stay with us.
- [45:39]
Leslie Picker
Final trades coming up.
- [45:42]
Joe Terranova
Are you following the Halftime Report podcast? What are you waiting for? The look for us in your favorite podcasting app. Follow the Halftime podcast now.
- [45:56]
Leslie Picker
We are back with final trades. Josh, we'll start with you.
- [46:00]
Josh Brown
Oh, I, I think I just want to. I think I just want to point out in video is finally starting to act better on down days for tech. I think that's new and we should pay attention.
- [46:12]
Leslie Picker
Yeah. Up 1% today, Steph
- [46:16]
Stephanie Link
United Health Care, the CEO is doing his job in turning around the company. The turnaround is happening. They just guided to $20 a share and the stock is cheap and it should be bought.
- [46:26]
Leslie Picker
Jason.
- [46:27]
Jason Snipe
Goldman Sachs capital markets revenue was up 53% year over year. I like this one.
- [46:32]
Leslie Picker
And last but not least, Joe, if
- [46:34]
Joe Terranova
there's complacency anywhere in the market, it's surrounding the price of oil. The last two weeks, oil has gone from 69 to now 85. Even energy traders are dismissing it and saying, okay, oil is going to go right back to 70 soon enough. We're not really going to get excessively long. I think you need to allocate in that direction. Yes, I said Valero. Today I'm going to say Diamondback Energy ticker symbol fang.
- [46:56]
Leslie Picker
And that one's up 1.6%. That does it for halftime. The exchange starts right now.
- [47:02]
Scott Wapner
You've been listening to CNBC's Halftime Report, the pipe podcast. You can always catch us live weekdays at 12 Eastern only on CNBC.
- [47:14]
Julia Boorstin
All opinions expressed by the Halftime Report participants are solely their opinions and do not reflect the opinions of CNBC or its parent company or affiliates and may have been previously disseminated by them on television, radio, Internet or another medium. You should not treat any opinion expressed on this podcast as a specific inducement to make a particular investment or follow a particular strategy, but only as an expression of opinion. Such opinions are based upon information the Halftime report participants consider reliable. But neither CNBC nor its affiliates and or subsidiaries warrant its completeness or accuracy, and it should not be relied upon as such. To view the full Halftime Report disclaimer, please visit cnbc.com halftimereportdisclaimer Most of us
- [47:49]
Wayfair Advertiser
are one good deal away from finally replacing that worn out rug, fixing up the backyard, or getting the bedroom we actually want. Good news. That deal's almost here. We Wayfair's Black Friday in July sale get up to 80% off area rugs and up to 60% off outdoor and bedroom furniture. Shop Wayfair's huge selection of styles and find the piece to fit your style, budget and space, plus free shipping. Black Friday in July ends July 27. Shop today at Wayfair.com Wayfair Every style, every home.