Episode Summary:
- Both Apple and Amazon are down
- Buy The Dip For Apple Stocks?
- Amazon stocks down after earnings, guidance miss Wall St. estimates
- Apple sinks on supply chain woes
CGC,MJ,TLRY,GRWG,AMZN,AAPL
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Guests:
Michelle Krebs, Sr. Director of Automotive Relations, Cox Automotive; Executive Analyst, Autotrader 36:20
Meet The Hosts:
Dennis Dick
Twitter:https://twitter.com/TripleDTrader
Spencer Israel
Twitter: https://twitter.com/sjisrael
Joel Elconin
Twitter: https://twitter.com/Spus
https://www.premarketprep.com/
Disclaimer: All of the information, material, and/or content contained in this program is for informational purposes only. Investing in stocks, options, and futures is risky and not suitable for all investors. Please consult your own independent financial adviser before making any investment decisions.
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Good morning. Good morning, Spencer Israel, Dennis take Joel is also here, but he is refusing to reveal himself. His camera's turned off. His microphone is on what his camera's turned off. He's I think he wants to do a grand reveal.
We don't know what Joel looks like right now. He, uh, buddy buddies here. I promise. So we got a lot going on today. Michelle Krebs is our gas juice from Cox automotive. If you are joining us at 8 35 to talk through, uh, what happened in the automotive market, uh, in, in the last quarter of GM for Tesla, we'll talk about all that.
We'll get her thoughts. Um, we'll take questions from our chat as always hit that like button, please. And thank you. Um, Joel, do you, are you gonna ever show us your face today? Are you going to get, just leave us hanging for the full hour? Hey Mike Rosta, Joel Rosta. Joel, we going to cover on the show today?
Rosta. Joel, I liked
Murley shirt. The Jamaican mechanics made it here. Throw it back reference. That's a throwback reference. All right. We should go and Vertu where's Enver ever. Does it ever, does it ever come on? No, he did not come on and doing it the way we should've done it. He's doing his camera virtually show him and we're come on and show you for a second.
This is behind the scenes. You guys never met Anne Burke. And when you meet Enver, he doesn't want to do it. Come on in or in the scenes telling us what to do and to getting all the he's. The one that Andrew is the one that puts up all this nice, uh, everything that you see on your screen right now. Yeah.
Um, agenda, everything. Those of you who are asking, oh, I have a special guests coming in. Apparently those of you who were asking, oh, I have special guests here too. There you are. Okay. Got to come over onto the screen. Come on. Special guests. Happy, happy to go. Awesome. We got a Pyre and we got a wedge. And what are you?
Very fun. Happy Halloween. Yes. Dennis found a car, right? Okay. Have a good day. Kids are off to school. It's Halloween at school candy day. That's going to be exciting. Very exciting bye. To those of you who are asking who I am, what I am. I am the Benzinga safety inspector. This is a real position at Benzinga.
Every company in our building is supposed to have a safety inspector whose job it is to, uh, be the leader during a fire drill. Uh, so usually it's Luke today does me. If we have a fire drill, we'll be ready. That's that's what I am dressed up as today. Or it could be Bob the builder, it look like you're ready for a construction job that want to come build my house.
I need more help. Yeah, that, that that's you. Um, Hey, real fast before we throw it to the charts, Joe, uh, Joel, uh, that's your cue to share your screen roster Joel, before we do that, uh, I just want to. Tell everyone, we are doing a special promotion today around Benzinger pro. If you are a Benzinger pro subscriber, you will be eligible for this promotion.
I don't, I'm not going to tell you what it is just yet. That's called a tease, but there is, we're doing a special Halloween promote. We got permission to give away something of, of real value. It's got nothing to do with Benzinga real value, not enough. Teads better than that. Uh, it's better than an NFC. Yes.
And we're going to give it away only to a Benzinger pro subscriber. Uh, we will talk about it on live trading or maybe at the, at the end, at the end of this show, uh, maybe, maybe for, come on and do it, but, uh, um, want to message? Put that out there. Okay. Let's let's get the charts up on the screen. Joel, how are we doing this?
Uh, good. Um, the M J N Dax is, are traded down 4 cents at the, at the current low of the move. Uh, w what should we be looking at? CGH uh, oh, wait a second. All these charts are looking the same. Holy macro. All these charts look the same. Give me, uh, give me, uh, what Gigi moves together. Yeah, relationships what's.
Uh, what's the one Gigi WRG or something. She are, I mean, are any, alright, well, we, we will look at those. I said, P futures. That's what you guys want to hear. We're in the rag by 20 handles, we weren't, all-time closing high and then apple and Amazon, they, you know what they did all over the, the market. Uh, so we're down 20 handles and just kind of hanging out mid range.
So it's going to be tough to get back to the old time closing high, but we'll figure out how to do it. Uh, crude that's down at diamond 82 71, just maybe going to be negative for the week, if that's possible. Uh, gold down 1160 at 1791, even silver in the ride by 19 twist called 20 cents at 2392 Bitcoin down by 3 80, 60 1,400.
And the theory of Ethereum futures there up $52 and 25 cents. And then I hear they made a new house. Let's take a look at it today and make a new high. So
$10,000 price target, Ethereum price target based on his feeling based on just hope, your hope. That's the whole trade. All right. Should we start? Let's start with apple here. Uh, so. If you recall, uh, Dennis was concerned, very concerned. He was nervous Purvis until this report. I tried to talk him off the ledge.
Well, it's a good thing. You need to listen to me. Um, because my thinking was, look, apple had already warned. They already said a few weeks ago that they're going to cut their they're reducing their iPhone 13 shipment, uh, guidance by 10 million because of supply chain shortages. Well, it turns out that those same shortages that are hitting the iPhone are also hitting every other part of their business.
So let's give you the numbers from yesterday and we'll bring the chart up on the screen. EPS was in wine sales. Didn't miss low eighties. That's very rare thing to say. 83.4 billion was what apple sales were. Last quarter. The street was expecting, uh, 84.8 billion. So they missed by about $1.5 billion there.
Um, I fund revenue came in wider. Wearables revenue came in wider. iPad did beat, uh, services. Uh, I actually came in higher as well. Um, but the big takeaway here, it was from the CFO, uh, Luca, my street that the situation would not resolve itself by the end of the year, the supply chain impact will be larger than the $6 billion charge that the company just had to take.
They said that yesterday as well, they're, they're taking a $6 billion charge, um, as, uh, because of, uh, supply chain was the end effect of that will be larger than the $6 billion charge for this current quarter. Um, and supply chain problems expecting, uh, affecting, uh, all other parts of their business, not just iPhone.
So, um, I still maintain my bullish stance that this is going to be a great buy the dip, but, uh, obviously apple is, is in, is in the store. Um, you know, and we know I was nervous. I just couldn't get an iPhone. I go into Rogers and I'm trying, I'm the last guy trying to buy an iPhone and they're like, we hardly have any I-phones and you know, and then I put an order in and they said it should be in, in two weeks.
It's six weeks later. And they finally call me, we have one iPhone and we suggest you take it because it's a, God knows when yours is going to come in. So the demand is there. We know the demand is still there. It's not a demand problem. It's simply a supply problem. They can't get the parts to get the iPhones out there.
That's why I was nervous that they were going to miss. That's why I was nervous about the supply chain issues at apple. That's why I bought putts. So, and puts were cheap. Joel puts very cheap. Yeah. The one I bought multiple, I bought multiple putts. I did, I did. And I didn't even do the spread cause I was going to do the spread, but I was like, I just thought they were fairly cheap.
Overall. One 50 putts, I got for a dollar sick. Dollar seven. I bought a couple of times in there, a dollar six, a dollar 10 right around there. And I went out just on a flyer. Um, so I had to myself with the one 50 putts, but I went out on a flyer and just in case it got really ugly. I just bought a lottery ticket, 1 43 putts.
So those may go off, the board are worthless, but those were going for 15 cents. So I was like, you know what? This really gets ugly. 15 cents kind of like a lottery tickets. So on the put side, I don't think those are going to hit. Obviously we don't know. It's still trading. It sells the full day. So there's going to be some movement here, but it looks like it's kind of found its home down five bucks.
I mean, overall, I didn't want, I don't want to sell my apple. I just want to hedge myself a little bit into this quarter. So it helps a bit puts will help a little bit. Did you? Oh, she did. Did this week. Yeah. I wanted to hedge through this earnings event. Wow. I wasn't hedging longterm. I'm still believer in long-term.
I wanted a hedge through this earnings print. So the cheapest way to do that, it was cheap. One 50 putts. So thing was 1 50, 2 and a half was, you know, fairly cheap, a dollar. I thought it was. Yeah, this is what Apple's doing. It's been running into the reports. This is what it did off its last report. I mean, if you're going to buy this thing into the report and use this deal, that strategy, we talked about sell it the day before the report.
I mean, how many people got jammed in this yesterday? I mean the actual day of the report, it makes the high, the move let's just look at is probably going to be reset of a trading range. Uh, got a hard bounce off the, uh, the, uh, after hours low. Let me tell you where that comes in. That's going to be our first area and feels, I guess it's going to, it's really thick and up here.
Yeah. 1 44 42. It's going to, it's really thick and up at though at 1, 1 46 and a half, 1 46. Uh, if you look at just if your scalp out on a rally and it gets near 1 49 72, that was yesterday's high. That could, that could really happen. But man, it just looks like it's going to be a trading range, maybe 1 46 to 1 48 and a half today.
Maybe the fireworks has already, I think so. So in and people are asking, I've got those putts, what's the best time to sell them. I mean, I can exercise the one fifties, but there's probably be a little bit of time premium left in it just because, you know, we do see some crazy reversals that time payment gets sucked out probably after the first half hour.
So I'll probably, I'll probably dump them within if I'm going to sell. Um, obviously the one 40 threes will have they'll have some value, but probably I'll probably lose on those because it didn't fall that far. So I'll probably sell them in the first, like 20 minutes, half hour. But you know, you get a feel for what's apple does like where where's it.
Does it open and start tanking right away. Does it open and start rallying right away? No, that all indicates there too. And obviously I'm, I rarely buy puts, and I was going to do a put-spread, but I just thought, like, when I was only paying just over a dollar, I was like, okay, I could have sold like a one 40 eights for like 50 cents and only 50 cents.
But then I'm only a hedge for two bucks. So, and obviously when I bought the one 40 threes, I thought there was an outside chance. This could really get hammered. I, you know, and that was a very, I just thought 15 cents. I was like, it seemed pretty cheap to just take a shot, but obviously we'll see what happens.
I don't know if those would be worth 15 cents even now, because it didn't fall out far. There might be some, there, there might be, it might be the play to get out actually at the opening print on those options. So, but anyway, I was nervous. I want to head through the print, so that's what I did. Nice job, Dan.
It's very, very nice. It's not, you know, it was more of a hedging trade that I was this nervous about the apple and you know, what is very surprising. So let's go to Amazon. We're talking Amazon then to talk to spy overall because spice holding up well, yeah. Mean Amazon . The report hinged on a one thing.
And that was supply chain problems. The Amazon report did not hinge on really any one factor, which I guess in the sense of makes it a little bit more concerning here. So the EPS for Amazon came in a very light, the, the reported earnings per share of $6 and 12 cents. We'll get the chart up $6 and 12 cents.
First, an $8 92 cents estimate sales of one, 10.8 first one $11.6 billion. And the guidance was also a light. The guide Q4 sales, one 30 to one 40 billion versus a one $42 billion estimate. Um, the one good thing here was AWS cloud growth is still really strong cloud, uh, revenue, uh, rose 39% year over year.
Uh that's that's, that's still good that that's, that's in Y with, uh, prior to growth rates and that's all looking good, but everything else was. Not great. Or they talked about increased labor costs. They talk about staffing shortages. They talked about supply chain problems. They talk about a deceleration in their advertising revenue, right?
Um, their, their ad business, which is what they call like there are other business, right. Um, there was a lot here that was kind of wonky. Uh, there of course, spending really, really heavily on everything. They spending more on labor, they're spending more on content. Um, it, it was, it wasn't like a, I wouldn't call it a disaster report, but there was a lot of things to sort of go, huh.
That's what I would say. A lot of things that make you go, huh. And there's not very many times you can say that about Amazon. It's been in this range. And I tell ya, my buddy, Bruce, he listens show sometimes has been selling. I talked about him like last year for the last year and a half, he has been selling.
Calls and pucks both sides every single week. And he brings in like 75 bucks, a hundred bucks, 75 bucks, a hundred bucks, every. Every week. And I tell you, this doc has not done anything better than what Bruce has called, because when you're selling calls and putts, you want a sideways chart. And wow. I cannot believe how perfectly that has worked out for Bruce.
I don't know if they're going to continue to work out that perfectly. And at certain points in times he has been assigned. And then what he does is he just flips around and writes the calls. So, I mean, that works so well, those strategies when you get the sideways market and that's what Amazon is in and 3030 500 has been the range for almost a year and a half now, which is absolutely incredible.
And it continues to work so good job, Bruce, if you're less than just raking in that premium, this, I mean, obviously it's a little bit higher price stock, so, you know, it could have a little bit, but kind of feels like you missed it. Maybe 30 to 55, a that stands as the, after hours low, that comes in here, right?
At this area, you had a pair of clothes at the 30 to 50 while ours was a little bit lower, 32, 38. Uh, there was another law right in that area. 32, 38 36. Uh, I don't even know if you'll see that 30 to 60 was another, I just, you have this shelf here. All right there, we finally found the number 32 60 coincides with the October 13th law look like buyers stepped up to 3 28.
They're not, you know, they're not being like super aggressive, but buying and not, I think binding on the cheap get near the pre-market is going to be tough. And then coming back, looking for a rebound, you got to get all the way up to 33 86 to fill the gap, but a trading range, maybe, you know, maybe 30 to 65 to 32.
Oh, well, it's already at 3,300, so I don't know. 32, 70, 33, 15 trading range. A little tighter on a range. 3,500. Yeah, let it decide. I mean, cause it's, if you were trying to buy on, uh, on weakness, you had a really good chance here, then you're like, okay, I'm going to buy it again at 32 16, you didn't get your chance there.
So it just feels like there's buyers out there. Sellers not being super aggressive steer with the sellers were aggressive. Took it in down. And Dennis, you were talking about the arbitrage and facts and stuff, and I saw it tweeted, you tweeted it out. Like this is down, this is down. I was just going to say, well, just by Michael that's and you know what, that's what they're doing too.
I mean, Nvidia and Microsoft are, are probably trading up in the green a little bit here just because they need something to counter. I mean, 10%. So basically 10% of the spy is apple and Amazon. So you get 10% of the spy trading down 4%, roughly, you know, you could just say apple would just ballpark at three and a half percent.
Amazon's down 4.08% call 4%, call it 3.8% spies down 0.4, 2%. So that means if you back out Amazon and apple spy is actually flat. So that means every other component in spy here today is actually has the other 498 as a whole have to be. So it's not surprising that maybe they hold up Microsoft. Cause we already know the Microsoft results and they were pretty good.
And obviously, you know, we've got some other stocks that are moving around. They're not the only ones, the big movers in the spa. There's a lot of stocks moving here today, but you just got to come in and consider. You're like, oh, the market's getting killed today. My stock's going to get killed. Not so fast.
When you have those two stocks making up the entire loss of spy spy, if you back out apple and Amazon is actually flat right now. So this is actually a flat day for other stocks, which is why you're actually seeing some other stocks catch a bet. Sometimes you see rotation go into, you know, different names.
Some of the cyclical names may be hot today. The financials are holding up very well today. We've got steel stocks up because us steel had a great quarter. We'll get to that, but you're gonna see a lot of rotation here today. So don't just expect your stock to be red because fire is red. You got to look at the whole ETF and look at the effects.
And right now spy is actually trading flat. If you backed out Amazon. Do you want to know the last time that apple came in, in line, on their earnings and missed on their revenue. And I called this bottle, it was Q2 2018. You went over the last time, Amazon missed on both numbers, Q4 2016. This is a rarity.
This really, these companies are finding tuned machines. This is very rare for them, both for one of them, let them know both of them to come out, uh, below wall street estimates. So, yeah, and I find it amazing though. The S and P is only down 20 handles that, you know, they're not rolling this over into other tech stocks that they're not rolling this other.
I mean, you have the, one of the biggest companies, if not the biggest company in the world saying we have supply chain issues and the market's shrugging it off once again. And they are because, like I said, the rest of the 498 companies, I was like collective whole right now, or. On that news. I mean, somebody said on CNBC last night, just say it again.
I don't know who it was, but if apple can't get parts who the hell is getting parts, but the other side of that is like, if, if, and if one company is going to figure it out, who's it gonna be is apple, duh. Yeah. But they can figure it out. So that's telling me there's going to be supply chain issues here for the foreseeable future.
This problem is not going away anytime soon. And that means your earnings are going to be weak from a lot of companies that can't get parts. Now, if you're in the service industry, not talking restaurants because food costs, you know, and they're getting a wage inflation, but maybe, you know, certain industries are obviously going to do better.
I've been saying, I feel like the banks are going to do better in this environment. Um, because again, with rising prices across the board, I do believe the Fed's eventually going to have to taper. We know what they did in Canada. They didn't even just taper. They stopped altogether, uh, with asset purchases.
So, um, the Fed's not going to do that cause you know, they're, they're just, that's what they should do, but they won't, but we can see we're getting into this, you know, environment here where everybody, you know, is looking for a home. And I mean, the market has shrugged off so much and they're struggling off these supply chain issues too.
Does it eventually come home to roost? Does it, do these issues eventually start to hit stocks? I mean, we saw apple, Amazon just get, I mean, apple just got hit just directly because of supply chain issues. Does this start to hit other stocks? It's been hitting stocks. Does it continue? Well, I think it does, but where's the money.
Well, that's it. So they're just going to rotate another names. Like, you know, I I'm like, okay, I loaded up banks. I haven't been loaded up in banks. Like I am right now since the financial crisis. So I loaded all those Canadian banks, you know, a lot, a couple of people in the chat make in front of me for about a week and a half ago, I'm up four or 5% on a lot of those Canadian banks a week and a half.
So I traded my utility stocks because if you go into a rising interest rate environment, these are long-term plays. But if you go into a rising interest rate environment, which I think rates are going to start taking up, um, at least on the long end, then you gotta think, okay, well, utility stocks are not going to do as well, and financials are going to do better.
So it's just a reallocation. And I mean, the TLT is going to be your best indicator for that. It's been hanging out. I mean, we had a little rally here again in the TLT, but I don't know. I just think we're in this environment that eventually the fed is going to have to start doing at least. Because price inflation on labor side and obviously on, on, um, product side is not going away.
You know what? I could find my theme of small caps and smaller companies doing better next year with the bank theme and, uh, purchased us, uh, some regional banks ETFs this week. Should we get Tim Melvin on the show? Yes. Yes we should. Because he's our small county. No one knows small random banks like Tim, Tim back, bring Tim back and let's talk with Tim because he always gives us some diamonds in the RAF.
Cause he knows all these small little banks. And if you want to talk about buying hold, he buys and holds forever. Tim Melvin. So he'll hold positions for like a day. So he's a holder, so yeah. Yeah. If you want to, yeah, probably. I just wonder what you know, because it's always interesting when you talk to Tim, like how many stocks are on his radar?
Like there are some, you know, there was certain times, you know, this is, uh, you don't when we add him on a few years ago, he's like, I got nothing for you guys. You know, the, everything is outrageously priced. And then there were other times where, you know, he had three or four ones there. Some of them are trade by appointment only.
Uh, but, uh, yeah. It's uh, do you want to reach out to him? Are you trying to do it today? Spencer? Are you going to try, I'll reach out to them next week, next week. I'm Michael Snyder. I don't know if anyone here came to this is asking for a book recommendation on, on road market rotation or extracting. Yeah.
Well, well, we just did a whole webinar on this so I can put the link for there. You can still buy those webinars. They're up on our site. I mean, this is exactly what we were talking about in her Saturday educational event. And I know people want stuff for free is a lot of people there's people that pay for it too.
I mean, we put together, you know, a lot, we put a lot of hours into that educational event. So we have to charge for certain things, you know, certain things. Obviously we like doing the show for you guys for free, but when we do these extra educational events, um, we have to continue to charge people like, oh, eventually I'm going to get it for free, but that's not, it's not fair to the people who actually signed up and paid.
So I just put the link for there, but this is what we talk about. This is how I make my living is extracting alpha from rotation. So, I mean, we talked about, you know, and we're going to talk about, we're going to have another event coming up on order execution number. I don't think we've announced it yet, but I think what do we have a date set for it?
You said we agreed. Yeah, I think, I think December. It's a Saturday, it's going to be on order flow and order execution. So where are we going to dive? Right. Good one. Yeah. We're going to dive into the nitty gritty of how you trading. Like what, how are you putting your orders? What is happening with your orders?
You know, how is we're going to put in like how even like, you know, showing how the off exchange market makers make money off your orders and you know, and how you can better advantage yourself for that. But I mean, all this stuff is tied into prop trading and professional trading. So that question that we just got is a fantastic question.
And what you're talking about, there are more professional strategies. I mean, and not saying retail, retail can employ these strategies. That's why we're trying to teach you guys some of these different strategies that the professionals are doing, because you can absolutely take advantage of rotation. I mean, we talk about that all the time.
We know the TLT and I give this relationship. It's the basic one all the time. When the TLT is down, the banks are up and Hey, look, this one at TLT down a buck, 18, what are the banks? They're all trading higher. So despite the spy being down, which we know is just apple and Amazon, your banks are going to be a source of strength because the TLT is trading down, extracting alpha from those relationships is how I make my living.
All right. Let's move on here real quick. Spencer, I'm going to do a screen share here real quick. And I just want to show you guys cause someone asked about, uh, purchasing it. Um, it's still up on the site is still gives the date, but if you just simply go in and register today, boom hit it registered today and it will bring you to do it and it will be automatically emailed to you after you you'll get the actual and you can get both of them.
Yeah. So this is a three, just to be clear. Pre-market prep.com. The link is on right now. That's where that is. Preoccupied.
Yeah. So if you guys, this was for Benzinga listeners, cause we gave you guys a promotional code. If you want $10 off two you've typed in BZ 10 in that promotional code and get 10 bucks off. Awesome. So the BZ 10 still works too. That's for the Benzinga listener. Okay. So let's move on. Just the sound, all that stuff.
Yeah. Yeah. Well, we'll talk more about this as it's closer. Ah, w those of you who were here on Monday, you saw the news about Benzinga, uh, and Berenger capital and the deal there. There's actually other bends in the news today that I'm going to break right now.
Benzinga is changing its name to fix.
And we're taking the Facebook ticker symbol too. We're taking the Fe. Yes. We're also going to go public with take the ticker symbol FB
breaking news, just from Benzinga is now Facebook. So we were called Facebook now. Benzinga is now Facebook. Facebook is now Metta. That's awesome. I like this new Facebook. Yeah. So yeah. So we're now the pre-market prep sponsored by Facebook. I like that. Yes. So how do we feel about this guys? That's a good name.
It's. How do we feel about Facebook running away from there? From, from, I hate it when companies change their names and who calls Google alphabet. Who actually, when we talk Google earnings, does anybody actually, you do, Joel, do you call it alphabet? Actually. Joel and I do. Joel's you do to Spencer? Well, like in the context of earnings.
Yeah. I never call it alphabet, dumbest name ever. Alphabet is for my kids. It's not for my portfolio, so I don't know why they changed the name. I don't know why Facebook has changed the name. They don't want to be associated there, all their businesses with Facebook. So what that you do out there? Things everybody's still gonna call your Facebook.
Are they changing the ticker symbol too? Yeah, but what is it? They can't change it. The Medica this already taken, they were too slow on it. The ETF got them. They shouldn't buy out that ETF and take the time to go to M V R S. It's going to be December 1st. M V E R S. That's a terrible ticker symbol. Michael Victor.
Roger. Simon. Yes. That's horrible. Well, well, M verse metaverse that's not even good. Metta is way better, man. They messed up. They were dropped the ball on that one. Sucker Berg. Cause this Mehta hasn't even been out there. How long has met? I've been out there that has been out there like three months. You couldn't do this three months early and get the medicine ball.
Terrible. I hate this even more now that they couldn't get the Metta. Terrible. Could you do a speci? Could you do one more breaking news?
run our test. That a world peace is going to be a spokesman for the company. Yes, we have signed her on our tasks. We have signed the person formerly known as metal world. Oh no. They've signed him. That's what you meant. They've signed. Yes. Yes. Sorry. Who was responsible for the malice in the palace? Real fast.
That all he was too. I forgot about. What was the fan? He found the fight with the fan. Yes, yes. Yeah. Well, the fan threw a beer, Adam and
yeah, that guy is permanently banned from why we can't say the palace anymore, but yeah, that was ugly. So Facebook, obviously, you know, the news out yesterday, they're going all in on the metaverse of virtual reality, augmented reality, changing their name, but that's not the only place. Uh, in the metaverse, there's actually a number of stocks that moved off this news yesterday.
And I want to show you all first shout out to Chris catchy who wrote this up in an article and I'll put the link to that article in the chat right now. But if you're unbending a pro, you can also find it without having to rely on me sending you an article. There's the link. If you go into the Crow newsfeed, and you literally, and just like I was messing around yesterday, let me get rid of that filter.
I was just messing around yesterday and I thought, let me just do a search for the word, like augmented or augmented reality. What do you augment the reality? Right? Because that's, that's basically, you know, what w what this is right, is augmented reality and look at all the different, and these were the same tickers that Chris mentioned in his article.
Look at all the different tickers here that we have that are moving off of this news, like PCI KOP. MTTR. I don't know what these are, actually. I know what my report is, but CSCW, I'd never heard of that before. Right. Moving off it. And look at this one here's Chris's article right there. 5:55 PM yesterday.
Boom. Here's the full waste. All these tickers roadblocks. Uh, we, me hologram, um, uh, yeah, VR AR oh great. Ticker for VRA. I remember you can seek catchy on SPACs attack. What time SPACs attack 11 o'clock 11 o'clock catchy is my go-to guy. I may, Mitch's obviously to where they know this backs very well, but anything in that universe, I go to those guys, those guys do the research due diligence with an exclamation mark on it.
That's Chris catchy. So there's like a whole, uh, dare I say, a universe of metaphors. Companies that were moving off this news yesterday. Uh, I'm not telling you to go out and buy them. I'm telling you to be aware that there is more than just Facebook here, a blue hat. Uh, there's also the metaverse ETF, which is kind of just a big tech ETF, honestly, but, um, yeah.
What are the different metaphors plays here? It is. Uh . Was that one of them on there? Yes, it was. Yeah, that was a Kathy stock. Wasn't it? Yes, it wasn't. Who was he? Like one of the big Cathy names and she just kept loading up. Uh, it's been an ugly one too. She's had Tesla going for, but man, it here's the funny thing with Cathy.
You know, you look at the stock and you know, she's still, what, you know, air KK is off 30 per 25% from its highs back from February and look at where Tesla is, which is her biggest holding and Tesla's obviously significantly higher. So it means all of our other holdings have done really well. 'cause she's making a lot of money on Tesla, which is her largest holding and she's lining up, she's selling into the rally.
I think it's still our biggest position though. All right. I was saying she's made a lot of money on Tesla and her fund is still underperforming. So a lot of those other picks like boozy, not very good picks so far. Let's let's uh, let's take a look. You've got Facebook here. And for the longest time I had the three 20 to three 40 range.
Right. And I was saying, you know, you got to bust above three 40. I get higher prices and popped up there the day before. And then it had three 30 now. So I'm moving this down. I'm saying you don't get giddy about Facebook on the upside until you can clear three 30 and hold it conversely, on the downside here, you know, I know you don't have everything perfect at three 10.
But that's the new area. So that's, that's what I'm looking at. The breakthrough, a three, uh, 20 has been a little bit choppy, but right now there's your trading range? Three, 10 to three 30. And I, and when companies start doing things like this, I D it doesn't exude a lot of confidence. I thought, you know, if you got to, you know, change midstream like that, but it's been a great stock for a long time.
And let's see if we can hold this three, 10 area. If not, we're looking for 300, the last comment before I bring on our guest today, and this is what I, this is the theory that I posited to Mitch yesterday, I had to close was last year, we saw two stocks run up into news events. On paper meant nothing for the company, right?
Apple and Tesla, both splits or stock doesn't change anything about the business, but both stocks ran up into those events. My theory is, or my idea is does Facebook run up into this name? Change December 11. Is that what it said? That's what I said. I don't know this, a name change since December 1st, December 1st, does it's a name change.
It means nothing on paper, but that's the idea. I hate the name change. I don't think people view positively as a problem. So that's why I don't know if it affects that. I think it's almost a negative, if anything. And what about social media right now? I mean that Twitter chart, like, well, look what's happened with the social media stocks.
Twitter is really getting hit hard. I mean, new lows again yesterday, Pinterest. We know since they not getting bought by PayPal, everybody's getting wasted on that. That is absolutely an ugly chart now. Um, obviously if they come back and, um, rumor materializes that could change in a heartbeat, but not a pretty chart at all, Snapchat has trying to bottom, but it was the one that started this whole thing.
So, and then you got Facebook, obviously off their earnings was trying to go higher and then they sold it off. And, you know, yes, we rallied a little bit on this metaverse thing yesterday. There's overall issue here with social media right now. I'm not sure I'm not even a hundred percent. Like I said, with the DWC and Trump doing his thing, that there isn't a few nervous investors saying if Trump gets this thing off the ground, there's a lot of supporters.
A lot of people could actually go on that platform. I showed some Twitter, but I'll, I will talk about that after Michelle. Oh, you sold some Twitter. All right. Hey, let's bring on Michelle Krebs, senior analyst at Cox automotive. And let's talk about, uh, I guess there wouldn't be a chip shortage in the metaverse right, Michelle?
I don't know about the, that fair enough. Okay, Michelle, we are, I guess we're through the car portion of the earning season here. So recap for us what happened and what each of the individual, the largest automated. Well, we got the Japanese coming in the next two weeks, but, um, we, we have got Tesla started out with, you know, record breaking deliveries, record breaking profits.
Uh, and then this past week we've had GM Ford and Stelara does, it was very clear that the, uh, chip shortage, uh, hurt their earnings, uh, and deliveries, uh, GM, but in particular, they, they kind of got a free ride early on, and then they got hit hard in the third quarter. So their profits were down about 40%, um, for less so down about 23%.
Now, the interesting thing that's happening is yes, their volumes that they're on, the profits are down, but, um, their average transaction prices are soaring because of the inventory shortages. So what is out there is the really expensive stuff and it's selling it pretty high prices and they've slashed their incentive spending by a lot.
So that saves some money there. Okay. So that's just the, yeah, that's a story on Tesla. Uh, what about, you know, w w representing motor city here? GM Ford. Well, that's what I, yeah, I'm sorry. I'm sorry. You're right. You just covered all those. So w w where does that leave us going forward again? Well, we're still in a chip shorted situation, a very tight inventory.
The inventory of unsold new vehicles in the U S is, has been for several weeks, uh, under a million. We've never seen those kinds of levels before. I think you'd have to go back to the 1980s, even after the cash for clunkers, that, that sopped up a lot of inventory. It was at 1.4 million. So that was the most recent low.
So, and even if we get production plants back up and running fully, we're still going to have a big empty pipeline to fill. So it's going to be awhile. We think the worst is behind us. That seems to be what all the auto companies say. It looks that way in our numbers. Um, but it's, you know, we've got to climb out of this.
Do you have any insight as to why Tefillah was able to seemingly circumvent. This chip shortage a little bit better. I don't know exactly. Ah, uh, all right. So a lot less cars though, to Michelle. So that's a number, I mean, when it comparing, you know, 2 million cars that, you know, annualized on Ford and GM versus 200,000, okay, well, you need a lot less chips when he saw 10% of the volume.
Right. Right. And, and, you know, uh, the automakers kept building trucks and SUV's where they make a lot of money and then, you know, kind of put the car production on ice. So, yeah. Okay. We've got a question from the chat about Volkswagen. Uh, I know they cut their outlook. Tell us more about, about, about that.
Um, well, Volkswagen, um, you know, is going, wants to be an all electric company. Um, but they've got. High cost structure. So, um, and they've had a lot of TripIt, uh, issues, uh, with, uh, chips. They're big Wolfsburg Germany plant as never run this lean, uh, in terms of output. Um, so they're looking to cut costs out of their structure and they're talking about, you know, job loss as it eventually as they transitioned to EVs.
Okay. Um, and then I'd be remiss if I didn't ask you about that, that news from w what was it Monday now that their Hertz Tesla deal and also the Hertz, uh, Carvana Uber deal, um, what do you make of. Oh, I think it's really interesting. Um, so Hertz is buying a hundred thousand Teslas. It could end up being more than that possibly through next year, half of those, or even it could be the more, as they're saying this morning are going to be offered to Uber, Uber drivers.
Wouldn't be surprised if they added in Lyft drivers at some point because, uh, Hertz has been providing Uber and Lyft drivers with vehicles. Um, and it's a great deal for Tesla because they sell a bunch of vehicles. Uh, they claim it, no discounts. So that's billions in revenue, but also tremendous advertising potential.
And, you know, Tesla doesn't spend any money on advertising. So they're going to ride the coattails of Hertz who was just signed on seven times super bowl champion, uh, Tom Brady to be in it's ads. Um, really splashy ads, the campaign. So, you know, Tesla gets the advantage of that without having to pay for it.
I'll be honest, Michelle, I didn't realize that Mark Fields was the CEO of her. Oh, that just happened recently, maybe a month ago. Something like that. If you must be all right. Well, I missed it a month ago, apparently. Uh, so you, you spoke to, you spoke to Martin, right? W what did he tell you about, about this deal and like what it hurts?
Well, I mean, he, he knit together all these pieces. I, and, you know, they're, so they they're doing the Tesla deal because they believe that electrification is the future. It also, you know, they're coming out of bankruptcy. Uh, it really is a brand differentiator for them. And, you know, they got an early with Tesla because, you know, at some point the, all the rental car companies will start offering, uh, electric vehicles, but they, you know, NAB the first big player first and that's, that will give them an advantage and they may add other makes, uh, as production increases, um, And then the other thing that they're doing is they are, I asked what do you, what happens to these vehicles after they go out of the rental fleet?
Because typically they either come to our auctions or they go to, um, they have sales on their own. Um, and the way, uh, Hertz is going to do it is yes, they'll continue to have sales of their own. Um, but they'll also supply Carvana. Uh, so they avoid the wholesale network and, um, uh, Carvana will sell, sell them, have the supply of, uh, Teslas that they can sell, uh, as used, uh, looking ahead here, uh, you know, you mentioned that we're getting re-do for a couple more earnings reports, uh, from, uh, uh, uh, the Asian, uh, the Asian automakers.
What are we anything crazy to expect here? Are we expecting more than. Uh, well, you know, I, I think that what we'll see is it wasn't until September, October that really Toyota and Honda got hit Nissan got hit earlier. They closed some plants earlier. Uh, so I think it will be the next quarter that we really see the, the impact on Toyota Honda, but, you know, Toyota has been amazing despite they have the lowest inventories in the business, but they still gain sales and still gain market share.
And a lot of it has to do with a very efficient distribution system that I'm, everyone wants to know what the secret sauce is there. Yeah. We're on the line with Michelle Cox at analyst for Cox automotive crabs from Cox part of the cop's family. Sorry, I thought you got fired for that.
What about, I mean, we're talking about. And we're talking about GM and we're talking about Tesla, we're talking about Stelara and Toyota, but there are so many other of these smaller companies out there. I mean, are there, is there going to be a, you know, some of these smaller companies going to be acquired, is there, are there going to be eventual winners or are they just all going to go bye-bye and God just it'll lose out to the big boys.
There will be winners and I think there'll be losers and we'll have to wait it out to see. Um, and of course there are. Everybody's going after Tesla and I, you know, because you're in Detroit, you've seen the shirts that say everybody versus Detroit, this is everybody versus Tesla. Uh, and so, uh, there, there was a lot of speculation this week that, you know, eventually, uh, Tesla would lose market share and sure it will.
It's not going to dominate, you know, it's not going to have 70% of the market forever, but it's not. And everybody's focusing on the big guys, but these little guys are going to take, uh, bites out of it. Lucid, uh, delivers its first vehicle to a customer on this weekend. Uh, Ravion's going public. Um, and you know, there, there there's a lot of action on the ed startup site and not all will win
Spencer you're on mute. Hey, I'm on mute. I'm sorry. Uh, it was the Halloween rain. Do you have thoughts on Lucy? Cause they just rocked it up yesterday as they head into deliveries. Do you have anything. Um, you know, we'll see, I, you know, they're producing cars. That's, that's, that's a big plus. A lot of them haven't started producing.
Yeah. Shall do you cut? Do you look at Fisk or at all? I mean, some of these smaller companies, um, obviously I've got a long position in Fisker, full disclosure, but I mean, you look at what's happening with Tesla. Um, we are, they do have the deal with magnets. So we are going to start to see Fiskars on the road, probably at the end of 2022.
What are your thoughts on Fisker? Yeah, it's, it's a possible contender. It's so hard to know because you don't know all the financials. The other thing that they they're doing is they're, uh, tied with Foxconn to assemble cars, which may happen at the Lordstown plant in Ohio. Um, so a lot going on. I, I don't, I can't predict who's going to win or lose, but, um, why not?
You know, I'm not a financial analyst. We know that we know that, uh, one last thing for me, uh, do the infrastructure. I mean, we'd only talk about, uh, you know, got plenty of gas stations out there and they're, they're building more. I mean, w the, you know, is their infrastructure prepared for this many Evie cars coming on?
I mean, yeah, you can charge it up in your garage, but you know, for traveling, do you follow any companies in that space? And do you think that the infrastructure is keeping up with the eventual demand? It's not keeping up right now, but, uh, Uh, infrastructure proposal that's pending in Congress has, uh, some money for an EBV infrastructure is about half of what the Biden administration wanted.
Um, but that that's key because the number one reason people don't buy EVs is they're worried about the range and the charging infrastructure. If the charging infrastructure were there, the range, which is improving vastly, wouldn't be as big an issue. But yeah, it's the, we gotta have the infrastructure for, uh, Evie adoption.
One more thing on the, uh, and the controversy, the self-driving. I mean, it seems that whenever it comes up with Tesla, you know, the, you know, the wording that, you know, they have the disclosures, the protection and everything. Uh, you know, when, when do you see that becoming, you know, more, more common. I don't know about more commonplace, but they've got a battle in Washington on that.
So they're, you know, being watched much more closely, uh, as a w how they're positioning it and, um, how it's performing, uh, by the safety regulators in Washington. So that that's certainly something. Michelle Krebs is executive analyst at Cox automotive. Joining us live from Hey, the motor city, just like us, Michelle pleasure.
Thanks a lot. Thank you. All right. Uh, Hey Joel, do you want to tell us about Twitter now? Yeah, I'm a little, uh, I'm going to talk with Sean at 9:00 AM on a pre-market prep plus about this. And I've been wanting to sell this for a while. And I kept a little piece, Dennis, so I could do what you do and just,
um, and uh, I wanted to do it before the report and I did it. I did it, you know, early after the report. And I just think this, this whole social media space is just, you know, it's ran its course. I think there's competent. I mean, originally Dennis, when you mentioned, uh, uh, you know, about the Trump thing, whether or not that comes into fruition, I really don't know.
Um, a talk with another buddy of mine that has been involved in, uh, it's own Facebook for a long time. And he was just like, these stocks have run its course. And I just thought I'd ring the register and uh, you know, yeah. From under 20 and, you know, whatever, I didn't get the greatest price of getting out by dog.
Got a little piece and maybe get a little bit back by on the rebound. But rear we are going down hard here, right? Oil is getting hit. Gold is getting hit. Um, you're seeing movement. Um, obviously there's still some stocks holding up. We know there's going to be some stock screen. The financials are holding up very well, but I mean, gold has just turned around and is starting to get really slammed here.
We were about flat when we started the show. We're now down to 20 bucks. If you're looking at the futures are two bucks on GLD. So, um, but it's not only that oil is really rolling over here too. So got the USO going down. Yeah. W we had some oil earnings, uh, those are holding up, but the oil itself, the commodity itself is gone.
It's not holding up nearly as well. Yeah. This is interesting. We'll get a lot of stocks that are starting to go red here. So not just technology companies with apple, but we're seeing a few other stocks too. An IWM has went red too. It was holding up fairly well. Now I'd at me. I'm starting to go pretty heavy right here too.
So you're starting to see a little bit more nervousness here. I don't why this is what I would have expected last night off the apple and Amazon, and, you know, instill, obviously we're not down far from where we just were, but we've been saying, you know, that's a piece of holding up very well and they still are.
Obviously Amazon has leaked a little bit more four and a half percent and apples leaked a little bit more as well. Both stocks still hold the spies to holding up fairly well. Considering the majority of the, of the loss and spa is apple and Amazon. So it's interesting. I don't know if you're going to see as much rotation.
I don't know if we're going to see in everything sell off, but we're starting to turn in. We're seeing clear rotation an hour ago, and now we're starting to see clear selling in a lot of sectors. Like I said, steals, holding up. Well, caterpillar got an upgrade. I believe let's talk about steel. Cause we had us steel us steel report last night.
Uh, the earnings were good and the sales were good. They both beat as much. But on top of that, it's just like, you know, kitchen sink is what they threw at us. They did a $300 million buyback and they're raising their dividend from a penny to 5 cents a share. So going in the right direction there. So beat.
Buyback dividend raise. You see how much money they obviously don't think it's going to last. We know there's nothing more cyclical than, than some of these commodities. Let me $5 and 36 cents. Yep. You've still made $5 and 36 cents and I'm a spinner tweeted it out and I'm not sure I retweeted it. I'm not sure if it's accurate, but they said us steel made almost, almost as much money as Amazon on the bottom line.
Not sales, obviously, but on the bottom line, I didn't even notice that. I don't know if that's right or not. Can we go on and actually verify that you in the background verify that made $5.96 billion in overall revenue? Well, not revenue. You got to look at the bottom line revenue. Won't compare Amazon's revenues off.
The charts are the same bottom line. Okay. So bottom line. Let me, let me, let me look in the background. They just got to go look in the background there, but spinner great stat. I retweeted it. I know it's been her does his homework. So he's probably right, but I mean, Just going to show you how much money us deal on some of these commodities companies are making right now.
Now this is a cyclical business. And what does that mean? It means don't expect them to continue to make $5 a share every quarter. Because obviously if that was the case, that things train with a P of like two, we know these are, you know, these is not going to last. It's a cyclical business. They'll get to times where they're actually not making money.
Their earnings go like this much, like, you know, microns, a cyclical business, certain ones that their earnings just fluctuate like that. But right now, holy crap, they're baking so much money. I'm blown away by those numbers and know I'm not long. Somebody asked me if I was long ago, I did check. I had you as steel in there for a bet.
I had sold it. I had bought Cleveland cliffs instead. I'm knowing new. And my Cleveland cliffs, I sold the CLF. I sold for the simple reason I bought it 20 about a month ago around maybe it wasn't even 19, 19 and a half 20. And it got back up to that major resistance, the August highs, and it's looking like it's struggling there.
So I did sell my Cleveland cliffs. I'm holding my new core. I've had new core for 10 years. I don't tend to sell out at all Cleveland cliffs, come back down to the 20 area. I'll rebuy it. I'm playing that range. All right. Uh, us still we're treating it. The highs of the pre-market session a week and just reached, uh, 25 82.
Now we have a bit up in this area in a while that does coincide very nicely with a 25 79 high. So you want to see this thing open up here, make a charge, and you want to see it. Test this double top here at 26 in a 26 handle 26 32 when 26 43. I mean two highs in the same area after it was at $23 yesterday.
So I would just, this one use want to keep laying out those offers, you know, probably with bigger size. I think it will turn. I mean, you have a pretty good sell off on this. A lot of people are sitting on a pretty good profits, you know, I don't think you'll come anywhere near the top of the range from yesterday, but to start this $26, I don't even know if there's anything in the book at 26, but you want to see strong fall through the pre.
Yeah, a us steel made like almost as much. It wasn't like incredible. It was almost it. So what were the numbers? Do you have them well, yeah, if you look at net income, it was like 3 billion for Amazon and two and change for us steel and some credible on a per share basis. It was five, $5 and change for us deal and like $6 and change for just giving you perspective, uh, how much money USD on some of these commodity companies are making right now.
And I mean, obviously we don't look at the bottom line. They look at, you know, what you know is sustainable in the long run. And we know Amazon has always invested back in themselves and probably can make even more money. Uh, but you know, they obviously invest back in their own company a lot too, but I mean, wow, our us steel and some of these commodity companies, I'm making so much money right now.
Some of the lumber stocks, like I talked about the cam four that I own and Canada, I mean, these things are just printing money right now. I don't know. But then obviously can't for a, and then it's probably from the quarter before they were doing better, they had supply issues too. I believe there is some other issues hitting some, some other companies as well, but incredible amount of money from these commodity companies.
All right. We, we haven't gotten to any tickers from the chat yet. I suppose. It's time to go. Suppose we can do a couple. I'm trying to scroll through here and see what we got. Uh, someone, someone dropping, some, some EVs in there. I saw QR scan to get mentioned. Uh, someone just asks about another one that is kind of a high flyer.
Um, let me go here. Maybe trade on the smaller names and maybe it's lucid that's really, you know, picked up the steam on some of the smaller names. We load no loose and had a huge breakout there yesterday. And he saw a Fisker getting a big pop. You saw a lot of these other Evie names, really getting a pop, even ride showed some life ride, never shows life, but it showed a little bit of life there yesterday.
Um, I don't know if that continues or not. It's right now. It's the thing. I mean, anything to do with Evie, you know, with the lithium plays that we've owned for awhile, LTH M Lac. Um, I still got both of those. They've been unbelievable. The both making highs like. I don't know if that's, you know, I don't know if it's sustainable, I'll just say it.
But right now the trade is high. All right. We can look at Starbucks. Someone's asking about that. Cause they did a report last night and they gave guidance on the conference call. So the EPS beat by a penny of the sales, uh, more, it was a slight miss, more or less in line. They gave guidance. Like I said, on the conference call, they gave, uh, uh, fiscal year, uh, sales guidance of a range, the high $32 billion range, which is around where the street was expecting.
Um, I got spooked here to this one after the, the eat report. So I sold my Starbucks and like I'm. You know what I'm going to let you guys finish up here. I got this wig off and die. I see what I missed a lot of symbols here. I got to look presentable for pre-market prep plot. Catch up with you guys later on everybody pre market prep, thoughts on Starbucks, Dan and I was nervous.
The same thing I said on the show that day with eat. I'd be nervous on a stock like Starbucks too. For the simple reason, I don't want to own anything with that has significant wage inflation labor shortages right now. And I got to think, you know, we know McDonald's figured it out, but that's hitting, you know, probably from both sides, the restaurant industry, Starbucks, isn't a coffee shop, but kind of in there, I mean that industry right now is getting hit from both sides because the food costs are going up and their labor costs are going up.
And the demand is sure is. But they're getting hit from both sides. It's not where I want to be. It is not, you know, those are not businesses that do well in inflationary periods. All right. I think if there was any show this week that earned your hard earned, like, uh, it was this one, the spooky edition, the spooky edition.
Come on show some spirit guys hit that like button just to below 300 likes right now reminder. We're good. Uh, I think we're going to announce the Benzinga pro giveaway on our next show on live training with Benzinga this we're giving away a prize that has nothing to do with Benzinga. It is not even using a product is not evincing a service.
It is, um, something of real value, something that w w you know, we got permission to give this away. We had to ask for it. Um, it, it, you know, we couldn't just decide ourselves cause it, you know, it's above the threshold. So we are going to give away. This mystery prize to a random Benzinga pro today, we're going to announce what the prize is and how to enter the giveaway on live training with Benzinger, which is right after we wrap up here.
So that being said, please remember that all the information from our show is meant to be used as informational purposes and not for investing or trading advice. Thanks to our guests today. Michelle Krebs, thanks to all of you in the chat. Even the people who don't have any Halloween spirit that's okay.
And, uh, hit that like button for us, please. And thank you. Live training coming up right now, Dennis, have a great rest of your day. Have fun triggered trading. I want to hear stories on Monday about how events are pumped, how eventful it was for you. Cause I don't think you did it last year, right? So, um, actually we did, we did trick or treat last year, the COVID trick or treating where they're all messed up.
I want a good story. On Monday. Okay. Sounds good. Okay. There's your weekend. Everyone have a good weekend, Dennis, have a good weekend.
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