2024 Rotten Apple, Magnificent 7, & Stock Picker's Paradise, Ep. #210

As investors settled into the new rhythms of 2024, the latest episode of  The Capitalist Investor saw co-hosts Tony and Luke (with Derek regrettably out sick) tackle topics that are top of mind for those looking to navigate the market's shifting tides.

1. Apple's Downgrade and Market Saturation
A significant talking point was the recent downgrade of Apple's stock by Barclays. Despite Apple's revenue growth in previous years, the hosts questioned the broader impact of the downgrade. Pointing to market saturation and a lag in innovation, particularly in the realm of artificial intelligence, they compared Apple's current trajectory to IBM's historical shift from growth to a defensive stance.

2. The Future of Big Tech in a Potential Recession
The uncertainty of a looming recession had the hosts contemplating the fate of tech giants, especially considering last year's challenges faced by Google and Amazon that affected their stock performance. The conversation turned to the growth engines driving these companies, with special attention to the burgeoning sector of cloud computing and storage and the strategic importance of AI solutions.

3. Tesla's Valuation and Industry Challenges
Tesla, a key player and popular discussion point in many investment circles, was another hot topic. The hosts discussed Tesla's potential vulnerabilities, focusing on the competitive landscape of electric vehicle deployment and questioning if the company's current valuation may be too optimistic in face of these challenges.

4. Investment Strategies and the Role of the Federal Reserve
There's been much scrutiny regarding the Federal Reserve's actions, and Tony and Luke touched upon the potential influence of Fed decisions on the market outlook. With the market exhibiting capricious behaviors, the co-hosts contemplated the necessity of active management and discussed various strategies, including the dividend aristocrat index, when considering portfolio construction to hedge against volatility.

5. Individual Stock Performance and Predictions
In a more personalized segment, the hosts shared their thoughts on individual stocks within their portfolios. Tony brought up Visa and Match.com, considering the implications of a recession on sectors like credit and dating. Luke discussed Accenture and Raytheon's prospects, as well as a smaller but intriguing stock named Verify Me. While these stocks reflect different industries, the underlying theme was clear: the need for strategic investment choices in uncertain times.

Remember to like, share, and subscribe for more weekly content from your go-to capitalist comrades, Tony and Luke. Stay tuned for the promise of profits and investment insights, and we wish you a prosperous New Year!

#CapitalistInvestor #StockMarket #InvestmentPodcast #EconomicForecast #NewYears #AppleStock #TechTrends #AIMicrosoft #FederalReserve #InvestmentStrategy #DividendAristocrat #StockPicks #RecessionProof #JeromePowell #GeneralDynamics #VerifyMe**

Transcript

0:01

All right, well, welcome to this week's episode of Capitalist Investor. A new year is upon us. And you got me, Tony the tiger, you got cool hand Luke. And unfortunately, we got Derek. He's a little under the weather. And so Luke and I are going to take this on by ourselves. New year, new me, new year. Another dollar. Another day, another dollar. Okay. All right. Nothing seems too crazy kicking off the year for me. It does. I feel like my whole just mentality and life changed. Wow. Just in. Brand new year, brand new me. Starting to wake up a little earlier. Already getting back in the routines. Nice. Going to start meditating in the morning, meditating at night. I got to do that. I'm looking forward to this year, man. I think I'm going to make some good changes, positive changes in my life. I think we all kind of get off track in some aspects when it comes to food and health and things like that, and routines, we get kind of lazy. What are you going to do to meditate? You have an app? Do you listen to YouTube? What are you going to do? You got calm. And then I also have, like, I just go on YouTube and type in meditational. Yeah. I don't know. I don't want to sound too crazy, but I've been getting to the chakra stuff, like the root chakra and the sac sacral chakras. You got, like seven chakras in your body that you try to open up so you find different hertz and frequencies to open them up. I'm trying it out. We'll talk about that. Another episode? Yeah, we had a client actually talk to me about something called. It's called something walking. It's when you go out in the forest and you walk in the forest in the rain and basically just embrace the rain on your face and things like that. So I don't know, maybe I'll try that out, too. But we had a client talk to me. Isn't that how you get sick? Won't go walk in the woods in the rain and come back? He'll know you got a cold. Or how you heal yourself, too. Sinus infection, maybe physically, but how you mentally heal yourself? I know it sounds fun, man. It does. How weirded out do you get when you swim in the rain? Like you're already in the pool, and then when the sun's not out and it starts raining, you're like, oh, my God, I don't want to get wet. But you're in the freaking, like, it always freaked me out. You get out of the pool when it rains, right? I don't know. Anyway, I digress. So, all right, what are we talking about today? We are talking about Apple got downgraded by Barclays. So is it a rotten apple? We'll talk about that. The magnificent. Come on, Tony, you messed this up earlier, too. So bad at it. Magnificent seven. Google, Apple, Microsoft, Nvidia, Meta, Tesla, and Amazon. 2023. These seven stocks drove most of the return 60% or more than that of the return 70 of the S and P 500. We'll just kind of give our quick take on what we feel. Can these seven hold it up again? Maybe our favorites. Yeah, or favorites or which ones are poised to maybe go in the wrong direction? And that goes along with Apple, too. The first one. Yeah. We'll talk a little bit about apple and build it off there. The big short guy, right, who became famous during the housing crisis of what, 2008? 2009? Steve Eisman had an interview on CNBC saying, everybody is coming into the new year feeling really good, but sees room for disappointment. Luke, I believe you watched that interview. So you can fill in some of the things and we'll talk about what we expect in 2024. And then we talked about it in one of the prior episodes. We're a couple of guys here in the office. We do our stock pickers paradise dinner, where the person that has the worst portfolio at the end of the year has to buy dinner for the rest of the guys. And there are no going to eat. Well, tomorrow. Yeah, we got it tomorrow, actually, from last year. Last year's. Yeah, tomorrow it will be a good day, and it's not cheap. These guys have no feelings for the loser. Let's just put it. I got feelings. I'm going to take it light. I'm going to take it easy. Why they didn't take it easy on the last. Try to be a good guy. It's a rough world, rough waters out there right now. It is. All right. Because remember, man, me and you treat. Others like you want to be treated. Me and you are going up against cfas. In the last two years, we did not do well. No, this year we did. This year we beat the bricks off some cfas. So we'll see what 2024 brings. All right, getting into apple. So apple was downgraded by Barclays. And what were they down the first day of the trading? Four and a half percent. Four and a half, which is one. Of the biggest drops it's had, like, in a very long time. Yeah. Believe it. Basically. It's interesting, these analysts, they downgrade stocks but they don't downgrade the price target. I think the price target for them went from 161 to 160. So they downgraded at one dollars. So there's the downgrade. But what were they up last year? 25, 20, 40%? Probably. So probably 40%. It is a downgrade not to grow anymore. But let me ask you, we've talked about this. Apple has had 40% growth last year when they've had four consecutive quarters of declining revenue growth. Their revenues in 2022 were 394,000,000,000. In 2023, they were 10 billion less. How does your stock go up when it's multiple expansion? How does your multiple expand when you're going backwards? When we talk about multiple expansion, for the viewers out there. So you always hear this term called price to earnings ratio, right. And price to earnings ratio is essentially a way for you to value stock and what someone's willing to pay for one dollars of earnings. Right. Usually a PE ratio in the SP sits around, what, 16 and a half, 17 times? Right now, a lot of these tech stocks, like apples of the world, are sitting around 24 to 28 times earnings. So it's like 40, 50% overvalued compared to historical metrics. And the reason why you would be overvalued or overvalued compared to history is because you're growing faster compared to history. And the fact of the matter is, like you just hit on Tony, is Apple is not growing anymore. It's priced like a growth stock, but it's not growing. And one of the reasons for this downgrade, and one thing we've been outspoken about why we're not too bullish on Apple. We own it in a small sliver in our portfolio, but we're underweight Apple compared to the S and P 500. The reason why we've been outspoken is China. One of the reasons is China. China has been very bad for Apple. Geopolitics involved, but also the middle class consumer in China is looking pretty rough. We think we have it rough over here. They're looking really bad over there. So people aren't buying iPhones and services aren't growing as fast either for Apple that people were expecting. The wearables, the services, the itunes of the world and App Stores, they're not growing as quickly as people thought. I think Apple's got two issues. I think saturation is one doesn't. If you don't have an Apple whatever by now, you don't have one. I don't have. Do you? What do you have? I have Samsung. There you like, were you ever Apple? I was. So you get people that have switched and the reason people will switch or not choose Apple is because now they are lacking innovation. They have not come up with an earth shattering idea in a long, long time. And when you're going to start getting just other competitors getting better, I mean, you start watching the Google phone and stuff like that and they're just showing you how to take cool pictures. And I'm like, oh, that looks really like Apple's not coming out and really showing us what they do with like, I don't take a lot of pictures and throw filters on them, but it looks cool if that's what you're into. But another thing is that Apple is maybe like behind the eight ball on the IA front, the artificial intelligence, because of the AI. What did, ah, man, that's what I just do, that we're used to artificial intelligence. So Microsoft leading the way in AI, Google, they have their version of chat, GPT Bard is what they call it. Amazon's got Lex, Salesforce is Einstein. You get all these different, and they're creating this. And I read an Apple, or read an article that Apple is working on their AI, but they're really not going to incorporate it in their phones until around 2027. And the reason that they're being slow and deliberate is that they're trying to create the technology, which it could be the revolution of AI, that they're going to make sure it's just in your phone right now. If you use AI through a Microsoft device on your iPhone, it has to go to the cloud and then it comes back and they're worried about security issues and data issues. It's not very efficient for a phone yet. And so I think that's what Apple is trying to do right now. And that's why they'll come to the table with something. But the world just changes so much. We're talking three years away. Things can happen in three months in this type of. I think the thing is with Apple is they don't know what their next thing is going to. They thought about getting into electric vehicles. You remember they thought about acquiring Tesla, or they talked about it at least, or the talk of the street was they should acquire Tesla, but they were looking to get electric vehicles. They were looking at doing like Apple. Wear glasses, Tony Stark eyeglasses. So they're looking at all those kind of things, but they're not executing. They have these ideas and people kind of get excited around it, but then they kind of fall through or they don't invest enough capital R D to actually get it. It's like, I feel like Apple just doesn't know the direction of the company anymore. And this is why our philosophy. I know Mark said it. I know I've said our cfas say it is that Apple essentially became an accounting firm. The accountants came in and basically they're driving efficiency. They're really good at doing what they do, driving efficiency. But they went from an innovation firm to an accounting firm that just knows how to drive top line revenue. Bottom line revenue and cash flow. And they're cash flow king. Not a growth king anymore. That's good way to look at it. I've said it before. Maybe they're like the New IBM. Yeah. IBM is incorporated in so much technology, but then they just got so big and became stalling out. Right. They just became just this big defensive stock. So maybe that's what it might be and what it may become. What's the cycle of capitalism essentially is Steve Jobs was the one that made apple what it was. And you don't have Steve Jobs anymore. Then things change. I know. Yeah. I mean, Tim Cook's been phenomenal for shareholders. The question is the way path they're going to be phenomenal in the next 2030 years. Right. All right, so the magnificent seven, which ones will continue to be strong and which will be bomb. So we already talked about Apple. I feel they're the scariest because they're just not growing the revenues, in my opinion. But I'm just not a Tesla honker. I could go either way. Be like. They're like not a commodity, but a discretionary item. You don't need a Tesla. I think regulation on tax credits, if they're depleted or taken away, could hurt their sales. I think there's a lot of variables for Tesla, but they are the best at what they do. No one else is even remotely close to the technology that a Tesla has. Would you agree? Yeah. Technologically, I think that they are going to still struggle with this whole push towards evs when people aren't ready. I think that they're ahead of the game. Question is, can they last the next four or five years as deployment of the electric vehicle mentality doesn't get eaten up by the. I mean, they are having continued record sales and then you got somebody like Ford, Chevy and everyone else that can't move. An it's just from a stock standpoint, it's like when you're barely delivering profitability. Still, valuation for us doesn't make any sense. Right. For Tesla, it never has and probably never will. So are they the best? Yeah. The question is, can they handle, like you said, the rough waters or can, like I said, the rough waters that might be coming up with demand possibly slowing as the economy, middle class America continues to get squeezed over the next couple of years that just want to buy an 1822 $24,000 Honda Civic instead of a 40,000 $50,000 ev that they had to figure out how to do and charge and things like that. Yeah. So that's Apple, Tesla. That's my opinion. I think they're the scared. The next kind of group I feel would be like Google and Amazon because they're driven on their cloud computing, their. Cloud storage, and Google has their cloud. And Google already kind of took it on the chin a little bit last year because they were slightly in line or actually they were slightly below in line numbers and the stock got mashed a little, know, last year, still up for the year, but when they didn't report, they didn't take off like the rest of them. And then you got Amazon in the same boat. Right. And I feel that those are the two headwinds for those companies because if we do enter a recession, it's going to be one of the things that people don't use. Like they're not storing as much or they're not going to maybe get rid of the, I don't know how you get rid of cloud computing. So here's my take on the magnificent seven and really other stocks outside of the magnitude seven is I think next year, and I've said this many times, I think next year is going to be the year where 2024 technology or 2025, sorry. Of course you knew that was going to happen. That always happens at the beginning of the year. It's like every time I'm writing a paper, signing a contract, I'm putting the dates as. Anyway, I think this year you're going to want to look at companies that are benefiting from implementing AI solutions, right? Those companies that are able to go in, make things more efficient, not necessarily the full on suppliers of AI that have ran up very hard. So the Nvidia's of the world. Like, look at that stock. Nvidia is like the main darling of artificial intelligence. That stock's gone nowhere since July. It's six, seven months. It's the same exact price. Right. It's because a lot of this stuff is priced in. Right. One of the areas that I think is going to be the biggest benefit or fitter of artificial intelligence is Microsoft's of the world. I think Microsoft is a supplier of artificial intelligence, but they can also incorporate it into their own business to make themselves more efficient as well. So you want to look at those companies that are actually supplying solutions but can also implement them into their own business and become more efficient. So Microsoft might be able to actually develop it, implement it and benefit from both ways. Yep. And to put a bow on, like either all the other stocks are going to catch up or these seven stocks are going to come down to everyone else is what's going to happen. And I just don't feel as great about all seven of the stocks. But I do agree. I think the best of the whole bunch is Microsoft. Well, you've got, Microsoft's got their cloud business. They have their gaming business. They have just their mission critical Microsoft software. Yeah, their software business. I mean, think about everything they can implement technology and artificial intelligence into and completely revamp. Think about gaming, just for example, even like you can go into a game and now play against artificial intelligence computers. That's crazy to think about. Right. All right, so that's the mag seven. All right. Now the big short Steve Eisman came out and said everyone's pumped up in about 2024, and he could see room for disappointment. There were so many bears in the beginning of 2023, and now there's so many bulls for 2024. What a ying and yang is what I would call it. But I mean, if you take a look at analysts, they're expecting 12% earnings growth this year and next year, 24 and 25. Let's get it right. Not 23 anymore. Right. Operating margins continue to move higher. Now, they took a backwards step when everything was super expensive, specifically just raw materials and things like that. Everything's kind of settling out. But margins are moving higher, even though we have higher labor cost, higher materials, slowing top line. So how are they going to do it? Maybe just keep on raising prices to keep the margins where they need them to be. And that just sounds like nice inflation. Sounds inflationary to me, but the street's bullish. And should we be concerned? Well, I think it's actually coming from somewhere else. So 12% earnings growth projecting. A lot of people, like you said, people are expecting that come from the revenue side. So either the consumer consumer needs to remain extremely strong or like you said, you need to raise prices to get that 12% number, which is inflationary. I think it's possible it comes from the other side. I think it comes from, like I've said, the technological artificial intelligence implementation into businesses that drives efficiency, jobs, unemployment will rise, but actual bottom line revenue because overheads couldn't cut will actually drive 12% earnings growth to the bottom line. So I think it's going to come from the efficiency side this year, which is great for Wall street, but not necessarily good for main street. Now, what's interesting is I watched that interview and one of the questions he also was asked about was just like, credit crisis. Everyone's talked. We saw Silicon Valley bank happen. We just passed $34 trillion on our national debt. I mean, that's insane. $34 trillion. Now, last time we talked, it was like 32 trillion. Like we're just getting up there and up there with no stop in mind. But he was asked because he called essentially the credit crisis in 2008, 2009 for the housing market. He was asked yesterday on CNBC, do you think there's going to be a credit crisis in the government with all this debt out there and even in the banking sector currently as it stands? And he's like, well, in our business, if your timing is wrong or if your timing is not right, then you're wrong. Right? And what's interesting from the government side, he said, is the past 40 years since he's been in the business, every single year they're calling for a default in the government, right? And some sort of credit crisis in the government because we keep on spending money. We have been for 40, 50 years. So he's like, people have been calling this for 40 years. And he said, have some humility. If you're wrong for 40 years straight, have some humility and say, maybe I was just wrong and this isn't going to happen. But I think that he was hitting at something that was important. But also I think he's being strong and saying that we shouldn't worry about it. But he has a point. We're probably not going to lose our reserve status in America as the dollar being the reserve status, we probably aren't going to have a credit crisis this year given we still are. Strongest nation, strongest economy, probably out there in the entire world. So we shouldn't have to worry necessarily about that. But what we do have to worry about and think about is the path we're on and figure out how to change that path so that way we don't look back 10, 15, 20 years and maybe one day we are actually right about some sort of credit crisis and credit crunch again. Yeah, 2023, just year of easy money. And I think it taught us one thing with so many bears out there, it taught us to stay engaged, stay invested money. Time in the market is greater than time in the market is one thing. Did you have to be in the mag seven to make money? No, but it helped. But that's why you had to have. If you were just equally diversified. You. Made good money last year. 2024 could just be the year of where the 2023 laggards outperform. So everything catches up. Maybe those seven stocks don't grow double digits this year, but everything else around them does. What's going to be interesting is if we actually hit the earnings number of 12%. But earnings don't actually. Or multiples don't contract. Possibly. Who knows? We had multiple expansion last year. What happens if we have 12% earnings growth but multiples contract because the future outlook is kind of bleak, even though we hit the current 12%. Yeah, we could have pulled a lot of forward gains because we probably did. That's what I would assume. That's why active management is going to be very important to find those companies that are still in the laggard seat. Right. So I think just on a risk adjusted standpoint, take a look at the dividend aristocrat index. It was only up seven and a half percent last year. And those are the big boys, the companies that offer dividends, companies that increase their dividends annually like no one wanted anything to do with them. Last year. One thing was probably because of a four and 5% treasury yield is maybe one reason, and their growth is more steady. It's not exponential like the mag seven. Right. But I do believe in mean reversion. I do believe in sometimes looking where everyone's not. So we'll see what 2024 plays out. But the Fed could be the big. Look at Burry. You talked about Burry before. So you have Steve Eisman and then Michael Bury. The two big shorts, essentially from 2008 2009. Michael Bury was calling for like these. He's buying puts and short positions on the market last year, and look what happened to the market. Right. So it's like even the biggest and baddest that predicted the last crazy bubble got it wrong last year, it seems like. Right? So again, timing is everything. And it's like really the key, I think, for the market is paying attention to a lot of different things and then putting it all together, staying invested until things really start to make absolutely no sense. And when that happens, scaling back a little bit. Right. Because the market can be. What's the saying? Market can be irrational longer than you can stay solvent or something like that. Yeah. So maybe we have another five years of the market being somewhat irrational. But you have to pay attention to when things really start to take a turn. Have discipline. I know for us, if stock is down 10%, 15 from when we bought it, we sell it. Yeah. The irrational part. Yeah. Having a buy sell discipline and trying to take emotion out of it is very important. But the Fed could be such a big key this year because the market melted up since probably the beginning of November, mid October of 23, because Powell said, hey, we're probably going to have three cuts next year. And the market somehow heard six cuts. That's what's being priced in. And think about the two outcomes of that. What if there's no cut? That's going to make a lot of people upset because they're pricing in for the cut and higher for longer. It seems reasonable because they'll go back to the 80s when they didn't go higher for longer and they cut rates too fast and created hyperinflation, basically. They can't afford to do that right now. They got to get this right. And I think they'd rather, you would think that the Fed would rather see something broken than try to massage this thing into a soft landing is what. Question Powell has to ask himself is does he want to go down as one of the greatest Fed chairs in history or one of the worst Fed chairs in history? Didn't Yellen wrap that up for. What's that? Didn't Yellen wrap that up? Maybe the worst, probably. Or Bernake maybe. I don't know. I think pal knows what he needs to do. I think he's just getting too much pressure for things that other people want him to do. Yeah. So if he does what people want him to do, he'll go down as one of the best. We'll have probably somewhat of a soft landing. We'll stimulate the economy with lower rates. We'll push the Ponzi scheme out another 1015 years in the next two, three fed chairs down the road. We'll have to deal with the issues or he can actually do what needs to be done and kind of break the system a little bit. Get us back to reasonable organic growth rather than creating the Ponzi scheme of cheap money again. Right. He'll go down as one of the worst in history because the public will look him and it's bad thing. What's the saying? What's the hero saying? Superman. Spiderman. He said something like, what did his grandfather say to him? Spiderman, when he was dying? Live long enough for yourself to become the villain. Or something like that. I got to look this up, man. This is a really good saying that I'm trying to get out right now, but essentially, you stay a hero for long enough until you see yourself become the villain. If you stay alive long enough, essentially. And that's what I essentially think is going to happen. I always thought it was. Not every hero wears capes. I don't know, man. I'm going to find this when we go in the next topic. But think about the cuts, though. The cut could be a form of stimulus, and a stimulus could create more inflation. So it's going to be interesting to see what he does. You either die a hero or you live long enough to see yourself become the villain. Okay, so is that what Jerome wakes up, stares himself in the mirror, and says to himself, yeah, I'm a hero right now. Until I'm in his mind, he'll be the hero for ten years. If he does what the public wants him to do, he'll be a hero for ten years. And then ten years down the road, he'll become a villain because we'll look back and say we should have kept rates higher. Yeah. All right, so let's get into. Let's wrap up the show. We got our. Luke and I, our stock pickers, paradise picks. Why is it called that? Who made that up? I don't know. Because, I mean, there's really no monetary value to it other than if the loser has to probably pick up a couple thousand dollars. Steak dinner. Yeah, it's not cheap, right? I'm getting the best whiskey. I'm getting a whiskey I've never had before. Yeah, that's what we did last year. I think they had, like, a couple different wellers that I think, like, Robbie got that wellers in the orange. That's right. Barrel. So I think that's their single. So that's a couple hundred dollar bottles. Pretty good. It depends on if you're buying it. MSRP or on the black market? On the black market, yeah. It's a couple of $100. MSRP is like 70. It's crazy. All right, so my lesson from playing this the last few years was during 2022. I picked a bunch of small companies, and I just got beat down. Like, my portfolio was down 60 or 70% last year. I kind of just kind of went a large cap and then a mid cap and then maybe a flyer and then some stuff that was binary event. Either going to be good or bad. Most of my stuff worked out, and I'm either in first or second place. This year. So with that being said, I'm trying just not to be in last place, because I can see the edge on both sides of this sword. So I took three larger stocks. I took Boeing because, a, they have a good backlog of work. There's a lot of demand for new planes, and they're poised to just take advantage of that. The only thing I can say is they need to stop messing up. They need to stop messing up their designs. They need to keep the planes, the new planes in the air. Boeing 737 Max was a little bit. That was not good. Right. And that hit right around Covid, where they really took it on the chin. So let's hope there's no more lockdowns and hope there's no more design falters. Another company I took was visa. And again, I do want to say one thing. This is not investment advice. I would not say, load up on these stocks. This is more for fun. So some of this is just pure gambling. Some of these stocks we do own in our portfolio, at least the ones I'm rattling off. Two of the ones I'm rattling off, we do okay. So I adhere to some of our investment team's advice. Sometimes we go lone wolf. Yeah, but then you got to go pick that dark horse that no one would probably touch with a ten foot pole. I just didn't do that. But I took Visa as my second one. I just figured that with over a trillion dollars in credit card debt and interest rates going up, that these companies are going to continue to print money. My only concern is that default goes up, people just start defaulting on their credit cards, and because they don't care about their credit and whatever that might look like. So that's the pro and con of that stock. And then match.com or match, they own everything, right? Tinder, match. They own all kinds of dating services. And I'm like, regardless of a recession or not, people are going to still try and find love out there, whether it's for one day or one year or forever. That's what I figured. All of kind of guys. And then, hey, you know what? I look at it like, if there's a recession, people might be more active on that thing because they might not have a job, and they're just trying to stay busy. No pun intended. Listen, I don't disagree with you, man. I think that's a stock their revenues have been in. Client. They just implemented a new pricing model, too. They have like a high tier pricing model now for like $500 a month. So if you do have a lot of money, and you want to find love. Apparently, you get some exclusive benefits. Okay. So it's kind of, like, tailored toward that 45 year old couple that hasn't found love yet, that are very successful, that are looking for that. I think that's a good. In one of the CFAs, he saw my picks, and he. Yeah. Like, they were on my shortlist. He didn't pick it, too, but he was nice confirmation that they're like, yeah, that was on my radar. So what do you got, Luke? All right, so two stocks we own. One is Accenture. I talked about it last week on Charles Payne. Charles Payne seemed to like it, which was good. But Accenture is essentially one of the biggest consulting firms in the world. And with this technological implementation, AI implementation, next year, all these companies, all these large corporations, like the Boeings of the world or any other company that's looking to implement any kind of technological solution will call Accenture. So ACN is a ticker. We own it in our personal or in all of our portfolios here at SWP. I think that stock is great, not just next year, but next ten years. Second one, Raytheon. Geopolitics heating up. I know this was on Matt's shortlist as well, one of our CFA's shortlists as well that we talked to, which made me feel good, kind of like you did. Tony Raytheon is just a defense name. With China, Taiwan, possibly happening, things heating up in the Middle east, government printing trillions of dollars, a lot of that going to defense. I think Raytheon does pretty well next year. And it's a defensive name, not just defensive stock as in defense for our country, but it's more of a defensive nature name to where, if the economy does take a turn, that one should hold up pretty well. So that's the second one. Both being really large names. I am one of those guys that like taking a dark horse, kind of lone wolf stock. I do want to preface this even more on what Tony said. This is not investment recommendation. I have owned this in my personal portfolio recently. I think it is an interesting stock, because one of the things we look for here at SWP is management teams. Management teams are very important to stocks, and when someone gets a new management team, I really look into that stock to figure out why this new management team was implemented, what the future outlook is. So this stock is called Verify me v? Rme. It's a small $10 million nanocap stock that I expect to possibly double or triple over the next couple of years. They trade publicly. They trade publicly $10 million. Nanocap do about $20 million in year revenue. But this stock, it's so small. It's so small. That's why you can only put a small amount of money into this, because you're going to move it a lot, right, if you buy anymore. But anyway, they just got a new CEO earlier this year. Essentially, they do logistics for counterfeiting and anti theft, for goods like QR codes and tracking data, logistics for supply chain logistics. They just got a new CEO earlier this year that sold his public company that he was previously CEO of for $500 million, grew the revenues like crazy from 2005 to 2020, before he became CEO of Verify me. Essentially, he's an m and a guy. Corporate M and a guy. So they're looking to optimize the business, increase the profitability, increase the bottom line, and probably sell to another buyer a couple of years down the road. So that's essentially my thought process is this is an m and a target for a bigger firm, for antitheft logistics, things like that. Probably get bought out 40, $50 million a couple of years down the road. I think this stock could be a dark horse in the next year, could be a complete dud, right. But at least it gets me some, what's it called? Beta. Some beta to the market compared to Raytheon, compared to ACN. And you know what I mean? If it takes off, great. If it doesn't, I've known that some guys have took in companies and then they go bankrupt. Last year, I had the best stock and I had the worst stock for this one. I think I came in first or second as well. I don't know who's ahead, you or me. We're very close. Me and you were very close. But it's interesting. You can have the best stock in the world and the worst stock in the world and still come ahead. Yeah, your one went bankrupt and the one saved it because it 200%. Two or two or three x or something. But yeah, I mean, you talk about Raytheon. I know that we either own that or have owned it. And I know one of the companies that's in that same realm that I thought about was like general Dynamics. We wanted to buy it, and then the technicals got away from us. But they're an aerospace defense company. They make private jets, but they also make a lot of defense airplanes and ammunition and things like that. So never know how crazy the world is. You might need all that, and if they do, you're going to see a pop in those stocks, unfortunately. All right, that's it for today. Hope everyone had a happy new year. Yeah. Happy new year, everybody. I saw the walleye drop like I talked about. Did you? Yeah, it was cool. Okay. Do you take a video of it? I took a picture, yeah. Okay. I need to see that. And it's the beginning of the year. A lot of days to go, but have a happy, healthy new year, and we'll see you next week. If you have any ideas for the show, please reach out. Hopefully Dee's not sick next week. Hopefully dee's here. We're not sick. Yep. And he's not bringing. Yeah. Told him to stay home to make sure he doesn't bring it into the office. And he's here in spirit. All right, guys, have a great week. We'll see you next. The opinions expressed in the podcast are for general informational purposes only and are not intended to provide specific advice or recommendations for any investment, legal, financial, or tax strategy. It is only intended to provide education about the financial industry. Please consult a qualified professional about your individual needs.