Squawk on the Street SOTS 2nd Hour: Debasement Trade, Software Vs. Hardware, & Trump's High Stakes Mar-A-Lago Meetings 12/29/25
Dec 29, 2025
In this discussion, Adam Parker, Founder of Trivariate Research, underscores the significance of earnings growth over valuations for market performance in 2026. Jonathan Kanter, a former antitrust prosecutor, analyzes Nvidia's unique Groq deal and its implications for regulatory scrutiny. Richard Haass, President Emeritus of the Council on Foreign Relations, shares insights on the fragile state of Middle East diplomacy, particularly regarding Israel and Iran, stressing the challenges of achieving peace in the region.
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Episode notes
Earnings, Not Valuation, Will Drive Returns
- Adam Parker expects 2026 will make earnings beats harder and multiple expansion less likely.
- He emphasizes focusing on companies that can drive margin expansion, not valuation alone.
Prioritize Margin Expansion Stocks
- Focus on individual securities that can expand margins rather than market-level valuation.
- Prioritize companies likely to beat margin expectations driven by AI productivity gains.
Fed Cuts Less Likely To Inflate Multiples
- Fed rate cuts may offer less multiple expansion now than in prior cycles because we're nearer the end of easing.
- Balance sheet moves, not just front-end cuts, would be needed to materially reflate multiples.