Closing Bell - Closing Bell Overtime: Nike Disappoints; Hunterbrook Co-Founder On Shorting Hims 6/27/24

Episode Date: June 27, 2024

Former PIMCO Chief Economist Paul McCulley gets you set for the next big data points the Fed is watching and what it means for the market. RBC’s Lori Calvasina and BNY’s Jake Jolly on market positioning. Plus, our Sara Eisen breaks down Nike’s numbers before Barclays analyst Adrienne Yih dives deep on the stock reaction. Plus, Hunterbrook publisher and co-founder Sam Koppelman on their new report investigating Hims & Hers and why Hunterbrook Capital shorted the stock. 

Stocks trading in a tight range as Amazon sees another whoosh higher. Counter some weakness in the chip software, really strong though. The small cap index turning in a nice gain as well. That's the scorecard on Wall Street, but winners stay late. Welcome to Closing Bell Overtime. I'm John Fort. Morgan Brennan is off today. Coming up, the Dow's worst performer over the past 12 months gets ready for earnings. We're going to bring you Nike results and instant analysis as soon as those cross. Plus, shares of HIMSS and HERS Health are falling after a short report from Hunter Brook Media

called into question the safety of the company's weight loss drug suppliers. And we're going to talk to the author of that report in an overtime exclusive interview. Well, as we await Nike earnings now, let's get to our market panel. Lori Kalvasina of RBC Capital Markets and Jake Jolly of BNY Mellon Investment Management. Guys, welcome. Lori, so looking at this software move today, names like Adobe, Salesforce, even on the smaller end, Asana, quite a bit higher. It makes me wonder how vulnerable is this broader market to a moment of AI disillusionment, since AI is so much the story. I think you say the median forward price-to-earnings ratio of the 10 biggest stocks is near 30. It is. It recently got as high as, I think, 29.8 times,

and it hasn't really been able to break above that 30 times level, if you look at recent highs, kind of post-pandemic. So we've got a trade that's generally full in terms of valuations. If you look at the MAG7 names as kind of a proxy for either the AI trade, you know, or kind of the high-flying mega cap growth stocks, that one's also seen, you know,

tremendous earnings growth if you look back, but if you look forward, you're seeing pretty healthy growth rates, but they're decelerating and losing their advantage relative to the rest of the market. And if there's something I've learned in my two decades on Wall Street, when you've got expensive valuations and you've got decelerating growth rates from astronomical levels, it's really, really there's just not a lot of margin for error. And I think that's what we're starting to see with some of these reactions. Well, that being said, still, Jake, you say even if there's no decisively good news coming out soon, the overall market can keep creeping higher if we're just muddling through.

Why? Yeah, I think that's right. I mean, when we look at the macro backdrop, and that's really what my team focuses on, this is still a backdrop that I think is generally supportive for risky assets and equities because, you know, we're going to see moderating growth, but it's going to be positive. We think it's very unlikely to be recessionary. We think that those cuts from the Fed are on the horizon, even if they get pushed off a little bit.

And I think maybe most importantly, when we look at the earnings backdrop, the earnings picture, I think, is broadly pretty positive. You know, we are, you know, I think seeing some of that weakness at the earnings backdrop, the earnings picture, I think, is broadly pretty positive. We are, I think, seeing some of that weakness at the top of the market and some jitteriness coming from that. But when you look at the other 493, I think there's a lot of positive momentum there. You're seeing, I think, that broadening out in the earnings picture. And I think the sooner we can get to a place where we're not playing sort of the monetary policy guessing game, we can really focus on fundamentals. I think the market will come to appreciate the fact that we still have positive growth.

We're going to get some easing on the horizon. And generally, I think that's going to be pretty positive for this market. Now, that might take a few quarters to play out, but I think the setup here is still relatively positive into 2025. I guess we'll have to see how the fundamentals look by then a couple of quarters from now. Lori, you also say you're not bearish, but you call yourself a tired bull. A tired bull. And someone used the term aggressively neutral with me recently, and I think that's a great phrase. Look, the reality is it's not just about whether you're growing, right? If you actually look historically at the economy, zero to two percent GDP, the stock market usually goes

down in that kind of environment. Markets don't like sluggish growth. You really need to transcend the two percent GDP environment, kind of getting that two to four percent or higher sweet spot to see stocks go up. And I think the problem we've got right now, right, is we've got this squishy consumer. We're hearing, you know, some of that from some of the earnings reports we've had today. The evidence just keeps piling on week after week. And while, you know, I'm not in the recession camp by any stretch, I do think there are a lot of powerful consumer buffers. I do think the consumer is pretty darn mad about inflation and doing something about it. And so we've got to work through that.

And if you look at GDP forecasts for next year, they're still sitting at about 1.8 percent. And if you look at this year, they're sitting around 2.3. They've actually gone down a little bit recently. We haven't seen them move up. If you go back to February and March, when we were having all this excitement in markets, you were seeing a quick ratcheting up of GDP expectations. So, you know, all this sort of squishy consumer labor backdrop easing a little bit, maybe the Fed cuts a little sooner. That all comes against the backdrop of a squishier kind of tailwinds dissipating on the economic front. It's a tough environment for stocks to navigate. And we're about to find out how Nike did with it. Jake, I want to finish with you and actually ask about bonds. Inflation

uncertainty has had them in limbo, you point out. But for people who aren't trying to time the market and get total return, they're really focused on the yield in their portfolios. You think they're going to be mad in five years if they locked in here? I think they're going to be mad if they missed it. You know, this is a very high yield, you know, broadly speaking, market environment for bonds high yield, you know, broadly speaking, market environment for bonds. And, you know, when you think about what we experienced throughout the 2010s, you know, getting to today and, you know, where the 10 year is, you know, it's still a very attractive entry point. Now, I think, you know, if you think about the last year, there's been a lot of

frustration because everybody said, oh, you know, this is the time to extend, get out the curve, really lock in that duration. And you really haven't gotten a lot of bang for your buck because we've had so much inflation uncertainty. But I think, you know, now the confidence level that we're going to start an easing cycle is just much higher. And even though we're not expecting, you know, an aggressive rates rally in the near term, I think it's still a very attractive entry point for high quality bonds. And, you know, when you think about this a couple of years down the road, I think you're going to be happy that you locked that in and built it into your portfolio because, you know, we think about these things in the total portfolio context. And we do think that bonds are going to

start to play that ballast in the portfolio that they have historically. That's not to say that equities aren't going to outperform, but we think that the bonds is really going to provide that stability that it has historically. Makes sense to me. Jake, Lori, thank you both. Well, Amazon is the top stock in the Dow so far this week after crossing $2 trillion in market cap. And that comes four months after it joined the Dow and replaced Walgreens, which is plummeting today after disappointing earnings results. Senior markets commentator Mike Santoli joins us now with more on the Dow effect or lack thereof. Mike? Yeah, John, it's certainly a little complicated. It's not exactly clear whether it is a positive or negative net effect.

So also looking back to the class of new Dow stocks when Nike went in, that's almost 11 years ago in late September of 2013. Now, Nike went along with Visa and Goldman Sachs. And as you can see right here, only Visa among those three has outperformed the S&P 500 since the week that it went into. They went into the Dow. Interestingly, how Nike and Goldman have basically gotten to the same point right there. So we know it's an archaically constructed index. It's not fully representative. It's more subjective.

It's an index committee that sort of anoints companies as, you know, having bellwether status, but not necessarily reflecting the overall sort of market value in aggregate. There is a school of thought that says the stocks get kicked out. Maybe that's a sentiment signal that says they're getting washed out and it's a contrarian buy. Well, that's not quite the case either, because look at the three stocks that went into the Dow, that, excuse me, were ejected from the Dow to make room for Nike, Visa and Goldman Sachs. That would be Bank of America, Alcoa and HP. And you can see here, similarly, only one of those stocks has outperformed, two of them underperformed, but none of them radically trailing the S&P 500 since then.

So obviously, Walgreens dug a big hole for itself as one of these stocks that was kicked out. There's also plenty of bankrupt companies that used to be in the Dow over the course of its history. When I got into this, John, I believe Woolworth was still in the Dow Jones Industrial. Stop bragging. That's a confession, not a brag. I know, I know, I know. But Visa, of those, to me, is most interesting because for a decade or so now, which is around the time horizon that you're working on,

there have been this sense, oh, Visa, maybe it's not really a tech company. Maybe the mobile phone. I think there's been some misunderstanding of Visa. So to see it so far in the lead is interesting, at least as far as people's assumptions about what's in and what's out. That's a very good point. Actually, over the course of that time, S&P kind of moved it from tech over to financials, just technically into the different sector. And by the time it went in in 2013, it had been like five years as a public company, had already appreciated massively. And it might have been easy to look at that decision by the Dow committee and say, look, you guys are picking Visa at the top. It's always been an expensive stock. But because of the moat that it enjoys, it continues to compound. Yeah. Strong performance there, Mike Santoli. Thank you.

Well, Nike results do any moment. The stock has been a big underperformer, down double digits this year. We're going to bring you those numbers as soon as they cross. And former PIMCO chief economist Paul McCulley is going to weigh in on the cracks in the consumer, the importance of tomorrow's inflation print, and the other piece of data that's coming you need to watch. Overtime's back in two. Welcome back to Overtime. As we await Nike's numbers, red flags on the consumer popping up in other results. Walgreens, by far the biggest

loser in the S&P today after posting a bottom line miss, cutting its full year forecast. The CEO saying it faces a difficult operating environment, including persistent pressures on the U.S. consumer. Levi's also plunging. Q2 revenue came in short of expectations, warning that consumers have been generally cautious and aren't spending on discretionary items. And macro uncertainty also hitting General Mills. Its CEO said they're expecting value-seeking behaviors by consumers to affect both the products they buy and channels they shop. And the consumer is going to be in focus just moments from now with Nike earnings.

Again tomorrow when we get May's core PCE inflation print and Michigan's consumer sentiment index. So how will all of this factor into the Fed's plans? Joining us now is PIMCO's former chief economist Paul McCulley. Paul, it seems like an interesting five trading days here between PCE and then that jobs number, is the bar pretty high? I think it is going to be very interesting the next few days. We'll all focus on tomorrow. We'll get a warm and fuzzy PCE print. But I think the following Friday with employment will be even more important because we're getting a lot of things coming together here that says the Fed should have more confidence in starting the easing process, not immediately, but in changing their rhetoric towards sooner rather than later. And I think, quite frankly, we're one week employment report from the Fed essentially setting up a September cut at the end of July meeting.

That's not a guarantee, but I think that if you get a soggy employment report, a very tame wages a week from tomorrow, then most likely they would tee up a September cut at the end of July meeting. But are investors in danger of looking past the team that they're playing next to the team that they're playing next week? And I'm talking about looking past PCE into the jobs report in the sense that will the fine print perhaps matter more because people expect a warm and fuzzy PCE here? I'm not sure, John. I don't think the fine print will matter all that much because the overall mosaic of the numbers

are going to be warm and fuzzy. And that's not really a forecast. It's a bean count, given the fact that we've already got the CPI and the PPI. So you'd have to have something very adverse, I think, to change the sentiment tomorrow that we are getting closer. And then next week, we'll come into the employment report. That's hugely important. And then the following week, we will get Chair Powell testifying before

Congress. And I think that is hugely important and would be the window, if you will, if Chair Powell wants to shift a bit in the dovish direction in his rhetoric, he would do so at that time. Recalling that in March, he told Congress that we were not, quote, far from starting the easing process. So he'll be in a different environment. So we've got a lot coming out over the next couple weeks. Speaking of coming out, Nike's results just crossing. We are going through them.

The initial move is higher by about 3%. So we'll have those to you in just a moment. But as we await that, Paul, I wonder about the jobs numbers themselves. Does it continue to be the wage gains that you would watch here as being most indicative of whether we are kind of just slowing down in a way that's healthy for the overall picture where the Fed is concerned or whether something more concerning might be going on? I certainly think we will focus intensely on the wages because that's where the services inflation is coming from. But actually, I think it's more nonfarm payroll headline.

We've had a huge divergence between the establishment survey, which gives you the nonfarm payroll, and the household survey, which gives you the unemployment rate. And essentially, the thing that's really been rosy has been the headline nonfarm payroll, you know, well north of 200,000 last month. So I will be looking at the wages. But from the standpoint of ringing the bell at the Fed that the time is approaching, I would focus more on the headline. If you've got something and I'm not forecasting this, but if you've got something south of one hundred thousand on nonfarm payroll, that would be a bell ringer. Nike moving around a lot. I'll mention it's now down close to 3%. You can't trust those initial moves. So that leads me to ask about the consumer,

especially in light of what we got from the stress test yesterday and some additional concerns about stretched credit, particularly with those with mid to lower FICO scores. How much of a factor is that for you? I think it is a factor, and it underscores that we're living very much in a bifurcated economy. The top half of the income distribution is doing really, really well. They'll complain about inflation. They will complain about anything. Complaining is what their job is. But the fact of the matter is they're doing fine both on income and even more importantly on wealth. It's the bottom half of the distribution and particularly the bottom quarter of the

distribution who's really feeling the pinch. And I think you're seeing that in the nature of the companies that are reporting consumer softness is in the bottom half of the distribution. And I think that's hugely important. And not just for the economy, but for the Fed as well. Yeah, I'm just speaking of reporting, we've got to get to those Nike numbers. Paul, thank you. Nike earnings are out. The stock now down about 4.5%. Sarah Eisen has the numbers.

Sarah. Hi, John. So it is a bottom line beat, perhaps why you saw an initial positive reaction. A dollar and one cent is what is reported. The estimates were around 83 cents. However, it is a top line miss. So revenues missed. They were 12.6 billion. The estimate was more like cents. However, it is a top line miss. So revenues missed. They were 12.6 billion.

The estimate was more like 12.8 billion. But here's why the stock may be really reacting lower. In the release, and this is pretty unusual, Matt Friend, the CFO of Nike, says we are driving better balance across our portfolio. He also said our fourth quarter results highlighted challenges that have led us to update our fiscal 2025 outlook. We are taking actions to reposition Nike to be more competitive and to drive sustainable, profitable, long-term growth. They are alluding explicitly here to a guidance cut for the fiscal year 2025, which, remember, this is the fourth quarter, so that's when they look ahead.

So expect to get more details on the conference call. But usually they update guidance on the conference call. Here, very explicitly in the release, they are laying out that it looks like they are going to be lowering guidance. Now, I did speak to some top executives at Nike about what those challenges are that is leading them to cut guidance and to miss on revenues. And here's what I can tell you. So what happened during the quarter? Well, the lifestyle business actually was a source of weakness. It declined. Think Air Force Ones, Air Jordan Ones. And the size of the performance business, which is more running and basketball, that grew double digits, but it wasn't enough to

offset the decline in the lifestyle category. Digital was a source of weakness during the quarter. Digital sales were down 10% in the quarter, and that is a big reversal for Nike. According to top executives, they told me that there were challenges that started in April and May and continue there. And partially it's because these lifestyle shoes, the Air Force Ones, they're more represented in the digital channel than, say, in the stores. And that's why they saw weakness. The other point of weakness, which is leading to the lower guidance and the miss, is traffic in China, according to top executives, declined starting in the beginning of April, which is making the executives rethink the outlook for China. They tie it to macro concerns and issues, say that the space is very promotional across the marketplace. But they are noting that. As far as the overall picture

here, look, John Donahoe, the CEO, is into a turnaround plan. He's about one year in. He made all sorts of executive changes. They have acknowledged that there's been an innovation gap in the marketplace. They started filling that in the performance space, the running and the basketball, and saw results and feel confident in those results. But clearly, it's going to take time to work through and go toward the portfolio. The other feature that makes them confident, John, is that the wholesale orders, and I heard Seema reference this last hour, have been very good. The other feature that makes them confident, John, is that the wholesale orders, and I heard Seema reference this last hour, have been very good. The wholesalers are getting a three-year pipeline view into the product, and they're optimistic about what they see, in part

because Nike helps them grow the category if Nike does well. And so that's a reason to be optimistic. However, clearly Nike is acknowledging that there are challenges and there were some surprises, including the digital weakness, I would say, in the traffic in China and just what they're seeing in lifestyle, which is leading to this new outlook that I expect to hear a lot more from on the call. The call being very important, Sarah. Thanks, because at this $89.90 level where it's trading in overtime, it's right near 52-week lows. And we're going to have much more on Nike's results after the break. Also later, the publisher of a new critical report surrounding him and her health and the supplier of the company's weight loss drug is going to join us to discuss his findings as that stock finishes the day sharply lower. Overtime, we'll Welcome back.

Shares of Nike are slipping in overtime after reporting a miss in revenue expectations on their earnings report just moments ago. Joining us now is Adrian Yee of Barclays. Adrian, this is a rough one. I mean, your price target is around 109, but this is flirting with 52-week lows, at least in the extended session. What do we need to hear from management on this call? I think you need to hear that there is more certainty on the actions that they are taking.

I'll be fully honest with you. This is a very disappointing report. I think the DTC came in significantly lower. So if you just think about the structural elements of what's going on, the mix shift alone to wholesale is margin dilutive. But then they're also telling you that they're getting margin pressure and they missed all the marks on their direct side of the business. So it's kind of a combination of what should be good turned out to be bad. And we already know that there was a dilutive mix shift to the wholesale business. Disappointing.

I'm no Nike analyst, but it seems to me like DTC from so many of these brands is what, not only in the near term, but strategically, you need to be strong. The idea that you can control your own destiny, that you can sort of drive your own relationship with the customer, no? That is 100% correct. The DTC portion and channel of the business is actually retail, right? If you are 100% retail, that's your brand innovation. That's where you're platforming.

And you are one degree removed from the consumer. You talk directly to you and to myself. Through the wholesale channel, you're two degrees removed. So if you are not resonating with the consumer in the DTC channel, it is a problem. What I will say is that the company had shifted from wholesale to DTC, overreached the mark, and is now going back. So part of this is actually going back, but it's manifesting in the part of the business that drives sales and the business forward. So who's winning? Because years ago, you know, 10 years ago or so, you might have thought, well, if Nike's losing, it's going to be because, say, Under Armour is winning. Under Armour is not winning. So is it just the smaller brands that you might not think of on a public company basis to be a challenge or what? Yes. It's the confluence of these high-heat, younger brands, Hoka, On. What I'll also say is,

I think we've talked about this before, but the silhouette shift, the wider leg bottoms, right, and away from athleisure. So you're moving away from performance run, which has had its sort of topping moment, paired back to athleisure, and this kind of silhouette denim-based shift is kind of moving back to, I don't know if you remember 2017, the flat-bottom casual. Adidas and Samba selling out, right? So we're kind of moving back to Air Force One while they're liquidating Air Force One. Timing's just off.

All right. Well, we're going to follow this story for sure as we follow the consumer. Adrienne Yee, thank you. Thank you. And now it's time for a CNBC News update with Pippa Stevens. Pippa. Hey, John. The Justice Department today charging 193 people in a $2.75 billion health care fraud scheme and seizing over $231 million in cash, luxury cars and other assets. Among the 193 charged are 76 medical professionals who prosecutors say participated in schemes nationwide, including distributing misbranded HIV drugs and fraudulently billing Medicare $900 million for unnecessary treatments. The Biden administration today announced a fresh round of sanctions against Iran in response to what Secretary of State Antony Blinken called continued nuclear escalations. According to the International Atomic Energy Association, Iran has enough material that,

if enriched further, could produce up to three nuclear weapons. And an update on a freight train derailment in the Chicago suburbs. Train owner Canadian National Railway Company said in a statement, the 25 cars were carrying various substances, including one car that was leaking a limited amount of petroleum gas, which was contained. A precautionary evacuation that was ordered has since been lifted. An investigation into the cause is underway. John. Wow, Pippa. Thank you. Well, is a soft landing getting harder to achieve? Mark Santoli is going to look at what the charts are telling

us next. And as we head to break, check out shares of Infinera, the telecom equipment maker, surging on a report that Nokia is considering an acquisition of the company. And a verdict just reached on the NFL Sunday ticket case. Billions of dollars in damages. Those details when Overtime comes back. Welcome back to Overtime. Breaking news on the NFL. Julia Boorstin has the details.

Julia. Well, the jury has reached a verdict in the class action lawsuit against the NFL for the distribution of Sunday ticket. And the jury has ruled in favor of the plaintiffs and against the NFL. Damages awarded total about $4.7 billion, $96 million for commercial subscribers to Sunday Ticket and $4.6 billion for residential subscribers to Sunday Ticket. The NFL issuing a statement saying that they're disappointed with the verdict and, quote, we continue to believe that our media distribution strategy, which features all NFL games broadcast on free over-the-air television in the markets of the participating teams and national distribution of the most

popular games supplemented by many additional choices, including Red Zone. Sunday Ticket and NFL Plus is by far the most fan-friendly distribution model in all of sports and entertainment. Here's the key piece here. They say they will certainly contest this decision as they believe the class action claims in this case are baseless and without merit. What that means is this will be appealed and could go all the way to the Supreme Court. Back over to you. All right. Arguably the hottest property in television. So this is a big deal. Julia Boorstin, thank you. Let's get back to Mike Santoli with another look at whether a soft landing is getting harder to achieve. Mike. Yeah, John, here's the tracking of the Atlanta Fed real GDP now for the second quarter.

That's obviously the one that's just about to end right now. So remember, this gauge essentially takes all of the real time data as it comes out and says, you know, knowing what we know now, how is GDP running at an annualized rate? And you see we were above 3 percent for a lot of the second quarter. And we've dipped down around 2.7 after this fresh round of data. We had revised down first quarter numbers this morning in GDP. And you see it's kind of flirted at times with the economist consensus here, which is really down near 2%. I would say these levels, combined with what we know the first quarter did, are consistent with a soft landing type scenario. But you're kind of losing a little bit of the cushion on the growth side if it continues

to decelerate from here. So you can't really declare one way or the other until after the fact. But definitely, as the markets have registered, some less oomph behind economic growth in the last several months, John. All right. Interesting warning. Mike Santoli, thank you. Well, shares of HIMS and HERS getting hit hard, down 7 percent today on a research report by Hunter Brook Media, raising red flags about the telehealth company's weight loss drug business. But should investors be skeptical of that report, considering Hunter Brooks affiliated hedge fund is shorting the stock? Well, publisher Sam Koppelman is going to join us next and later the CEO of social trading platform eToro US on what retail investors are buying and selling right now. We'll be right back.

Welcome back to Overtime. Shares of HIMSS and HERS Health dropping today down 7% after an investigative piece from Hunter Brook Media said that GLP-1 prescriptions offered by the company are knockoffs and come from a supplier with a history of legal troubles that could open up hims and hers to litigation. When asked for a statement, hims and hers refuted all the claims in the report. The company has previously said that its GLP-1 compound is supplied by a compounder that's registered with the FDA. CNBC also reached out to the supplier mentioned in the report, BPI Labs, which said in part, neither BPI nor Belcher, its parent company, have any history of any criminal convictions or issues with the FDA. Hunter Brook Media itself has generated

chatter in the media world. The company has an affiliate, Hunter Brook Capital, that often takes positions based on its sister company's research. Hunterbrook Capital shorted hims and hers on this report. Joining us now is Hunterbrook Media co-founder and publisher Sam Koppelman, who co-authored today's report. Sam, what put your focus on this story to begin with? GLP-1s are all the rage. I'm sure you've heard about them. I've got family members on them. It's really exciting. Drugs with a lot of promise. Went into this research curious about how HIMS is selling these drugs, which are still under patent from the companies that made them,

Nova Nordisk and Uli Lilly. Well, it turns out that they're selling them through this FDA loophole that enables you to sell drugs that are otherwise patented during shortages. So it was kind of exciting. We were kind of intrigued by the idea. We dug into it further, and it turns out that the drugs themselves, not FDA approved. And we went to go try to get one of these prescriptions from HIMSS to see if there was a real process around it.

And in fact, when you fill out a four minute survey, you don't even have to speak to a doctor, and they'll just send you these medications. That seemed extremely dangerous, and the doctors we spoke to for the piece seemed to agree. So what made you decide to actually run a piece? Where was the bar for you on this? And I'll ask, are you invested in any competitors to him's and hers? Because there's been some question about exactly the full disclosure of your and the team's investments, even beyond Hunterbrook Capital's short position. So Hunterbrook Media does its own reporting. As you know, we've got incredible reporters,

advisors like the founder of ProPublica, the first public editor of the New York Times. We report independently. And then we publish what we know, how we know it, and exactly what positions Hunterbrook Capital has taken that are relevant to the piece. We've consistently disclosed whether we're short a specific company, long a competitor. In this case, we disclosed that we're short HIMSS because after sharing the story with Hunterbrook Capital, they clearly seemed to think that this company was in some trouble. And obviously today's market reaction shows that other people agree. Do you empty your pockets and tell the whole story when you put it out there? Or is there more? Are there follow-ups? Because, you know, it's a 7% drop that matters if you bought it at the top, but it's not a devastating drop with a short position you'd want to see.

As you know, often where there's smoke, there's fire. We're continuing to investigate. We've done some follow-ups in the past. You know, we ordered this HIMSS prescription. I think it'll be pretty interesting to see when it comes in the mail what exactly is in it. Nova Nordisk has cited that some of these compounded drugs have impurities. And, you know, one thing that really caught our attention when we were looking into HIMSS is that as the stock was soaring, as retail investors were buying the premise that HIMS was going to be a real competitor in this hot space, the insiders in the company, the CEO, the CFO, notably the chief legal officer, they've been unloading shares. They've been exercising their options that didn't expire until the 2030s early.

And instead of holding them for 12 months, which, as you know, has tax advantages, they've just been selling those stocks straight away. That doesn't give me a ton of faith in the future of the company, and I'm not sure that the executives at HIMSS have a lot of faith that they can keep the stock up. There's been, when we had you on initially, there was some question, all right,

you're saying that you're going to publish stuff outside of these reports that Hunterbrook Capital is short on, but are you really going to? You have been doing some of that. Tell me what you've been doing. Yeah, we've been doing all kinds of reporting. We've got reporters in about 12 countries who have written stories for us. These range from an investigation into timber mining in timber logging in Peru that we published over the weekend. That was a brilliant piece to a story in the desert in Argentina where a community's water was being drained for mining lithium.

So we've been really proud of the work that we've done. And, you know, one thing that's been super fortifying is we thought we'd really have to prove ourselves, and we do continue to need to prove ourselves. But the reporting itself has gotten praise from everyone, from Neiman Lab to The New Yorker. This weekend, Al Jazeera did a piece that called working at Hunter Brook Media, a journalist's dream. We really want to keep that up. It's very early. This is an experiment, but we're incredibly excited about what we've done so far.

To what degree is your near-term budget dependent on a big stock reaction from a story like this? So we raise money into the holding company. We can fund the newsroom ourselves. But the fundamental premise here is that we don't think that good reporting has to be a bad business. And so we publish the truth. Hunterbrook Media has independent fact-checkers.

Hunterbrook Media has independent editors, advisors who scrutinize every single line. That said, we also don't think there's anything to apologize for when it comes to trying to find a way to sustainably and scalably do work that's urgent, that exposes companies like HIMSS for potentially misleading investors, and that enables the market to better understand what they're really doing. Did you look at a broad range of companies in the GLP-1 space, or specifically this one? So we were really curious about this specific question

having to do with compounding. So essentially these knockoff drugs that were being sold because of the huge opportunity potentially and the commensurate risk. And one of the things that just broke my heart about this is that you had some patients who had experienced accidentally taking too much, too big a dose. And this is because unlike the versions from Novo or Lilly

that come with those pre-injector pens, these come in a vial with a needle. And people were accidentally overloading and injecting themselves with too much. That seems like something that's really dangerous. And I just hope that whatever the outcome of this report financially, that's Hunterbrook Capital's problem,

that HIMS looks themselves in the eye and says every single patient who orders one of these should have to first talk to a doctor. I think being pro-doctor should be something that everybody can get behind. All right. Sam Koppelman from Hunterbrook Media. Thank you for joining us here.

Thanks for having me. Up next, the CEO of social trading platform eToro US on whether retail investors are still bullish on Bitcoin despite the cryptocurrency's recent sell off. And another check here on shares of Nike. They are falling down 6% after revenues came in light for the fourth quarter. Over time, we'll be right back. Welcome back to Overtime. Well, the so-called meme trade has been back in the picture this year after mostly laying dormant since the heyday of 2021, even showing its head today with a spike for Chewy after a post from Roaring Kitty of a dog meme.

So what do retail traders have planned for the second half? Well, online trading and social platform eToro out with a new survey with hints at just that. Joining us now is eToro US CEO Lule Demise. Lule, good to see you. So I'm looking at this list of stocks that the retail traders skewing younger are trading on eToro. And it's what you'd expect in NVIDIA, Tesla, some things like that. But I also see financial services being what they're holding.

So what's the difference between what's being held and what's being traded? Yeah, so what we do is every quarter we do a survey of investors, about 1,000 in the U.S. in totality, about 10,000 across the world. So it represents sort of the various markets a thousand in the U.S. and in totality about a hundred, 10,000 across the world. So it represents sort of the various markets we're in. So UK, Spain, Germany, et cetera. And so that survey result is really about just investors. It doesn't have to only be eToro investors. And then what we do is we juxtapose that in terms of what they do on our platforms. And that comparison reveals interesting things for us. And the interesting part of it is financials this round, which actually surprised

me, whether you looked at it from a global perspective or the U.S. perspective in our survey respondent world, poised to be the number one in terms of their holdings, as well as prospects that they see for it as interest rates improve and, you know, financials start to benefit from that. What's interesting, though, is remember, that's not an allocation story. That's about like, you know, 54 percent said they are interested in financials. That doesn't mean it's the majority of their portfolio. Right. Still is the majority of their portfolio. So when you say financials, does that mean JP Morgan or does it mean like Coinbase and Block or are you distinguishing? You're just asking for those

broad categories. It's actually all of the above. We do distinguish, but also it's all of the above. So they're saying, you know, BOV, they're also talking about the cards like Visa is like a top holding as well as some of the Coinbase, et etc. We were just talking about Visa and how well it's performed over the last several years. So what is the treatment of crypto? Is it hot when it's hot or does the interest remain pretty steady no matter what the price is doing? No, it's not. It's not a singular direction. So, you know, people pause or sell when they feel that it's the right time. But it's not usually

they're not selling on our platform because they're running away, but rather maybe if they're taking, you know, sort of profits off the table. So right now, it's not surprising, right? We just had a halving. Miners are adjusting to sort of like the awards, the rewards they're going to be getting. So people are sort of understanding as to why the market is digesting the price of Bitcoin right now. We do see more volumes on our platform in the last few days. So there's an element of opportunistic buying that's kicking in as well. We wonder, I wonder, how much of a stomach younger investors, and I'm thinking more Gen Y and younger millennials, how much they have for market volatility and really the market being down for a longer period of time because we haven't really seen that in quite a while. Is there anything in this data that tells

you about the discipline and philosophy of the younger generation of traders? Yes. So a few things. So one thing that's really important is like you look at, you ask them like what concerns you, what makes you feel confident? Overwhelmingly, they feel confident about their jobs prospects and security, confident about their portfolio and what the markets are doing. And then when you ask them what their concerns are, it's really things like, you know, inflation being kept in check, interest rates eventually coming down. So I think that context is really important to understand their risk appetite, right? So they're not feeling insecure. And in that context, we're actually seeing them take more risk. That doesn't mean they're betting the farm on Bitcoin. We're seeing them take on, for instance, mega cap stocks and technology financials,

as I just mentioned to you. Energy is another area they played out this year, as well as the crypto coins that are their favorites. All right. We'll see what happens when this ride eventually gets bumpy. Alule Demise, thank you from eToro US. Thanks. Well, was the economy better during former President Trump's term or does President Biden get better marks? Up next, the stats you need to know ahead of tonight's first presidential debate. And because you love overtime and you want even more of it, we got a QR code for you. You can scan that on your screen. Follow us on LinkedIn where we'll continue to post exclusive content. Overtime, we'll be right back.

Welcome back to Overtime. Nokia now making it official, putting out a press release saying it is buying Infinera for $6.65 a share, an enterprise value of $2.3 billion, saying it strengthens Nokia's optical position, specifically in North America, and accelerates Nokia's customer diversification strategy. They're in networking. Meantime, the first presidential debate is tonight, and the economy is going to be front and center for voters and for investors. Our Steve Leisman breaks down the stats to see who gets better economic grades, President Biden or former President Trump. Steve. Hey, John, thanks. Yeah. Comparing presidential terms are difficult,

and nothing is tougher than comparing the Trump and Biden economies. Presidents get left the economies from their predecessors, and this raises questions about how do you treat the dramatic effects of the pandemic on growth, jobs, and inflation? Well, here we go. Biden beats Trump on GDP 2.9% quarterly average over his term to 2.4%, but Trump's numbers improve if you take out the pandemic, and Biden's come down a bit if you get the rebound out a little bit. Biden had lower average unemployment, Biden 4.1%, Trump's 5%.

Biden created far more jobs, 15.6 million to minus 2.7 million. But you take out the pandemic effects, the losses for Trump and the initial gains for Biden, it gets closer, but Biden's numbers are still better. There's. Question as to how much of those losses you attribute to Trump. Biden had stronger capital spending. He beat Trump with a 31 percent gain to 14 percent. But inflation, that's the major knock on Biden and with voters, with prices up 19 percent during his presidency. That compares to 7.8 percent average change during the Trump presidency, led to a decline in real or inflation adjustedadjusted hourly earnings of 0.6% during Biden's presidency, compared to 7.1% positive during Trump.

But year-over-year gains for real earnings have been positive for 15 straight months, though not enough to erase the losses so far for Biden. There are early signs that rate hikes are starting to bite the economy, just the election year or so. The electorate could see lower inflation rates, but there's this danger for Biden and possible gain for Trump would be rising unemployment just as it comes time to pull the lever in November. John? Steve, this is the perfect raw material for an on the other hand segment, which I did not do this week for special reasons. But really, it seems like there's an argument to be made no matter which candidate you like better. Yeah, you can twist these numbers any way you

like. We tried to be fair. We took away some of the pandemic negatives and some of the pandemic positives for Biden. Big question as to when that inflation began, John. I will say this. Biden's inflation was not worse than the rest of the world. We compared the U.S. economy during the Biden presidency to the advanced economy's inflation, and we were right on par with the rest of the world. So it was a global phenomenon, but there's going to be local prices to pay. All right. That's a perfect way to end, Steve Leisman. Thank you. That's going to do it for overtime. Fast Money starts right now.