Power Lunch - Power Lunch 12/4/25

Episode Date: December 4, 2025

CNBC’s Kelly Evans and Brian Sullivan take you through the heart of the business day bringing you the latest developments and instant analysis on the stocks and stories driving the day’s agenda. ���Power Lunch” delves into the economy, markets, politics, real estate, media, technology and more. The show sits at the intersection of power and money. “Power Lunch” gives viewers a full plate of CNBC’s award-winning business news coverage, plus a healthy dose of personality from the show’s anchors and the network’s top-notch roster of reporters and digital journalists.  Hosted by Simplecast, an AdsWizz company. See pcm.adswizz.com for information about our collection and use of personal data for advertising.

Well, stocks in your money hovering right near all-time highs, but one stock soaring as reality becomes less virtual. Welcome to Power Lunch alongside Kelly. I am Brian. Meta, acting marvelous on a report. It is cutting money from the Metaverse. If it sounds confusing, don't worry. We will make sense of it all in just minutes. Plus, a bizarre turn in the bidding war for Warner Brothers Discovery. Netflix is now the front runner in the race, and Paramount is crying foul. And financials, they're on fire. Citigroup, Walls Fargo, Morgan Stanley, all hitting all-time or multi-decade highs. And that's after a top Wall Street analyst says deregulation is going to spark a deal boom,

a deal boom in bank M&A next year. That analyst, Mike Mayo, will join us ahead. All right, folks, welcome, everybody. Hope you having a great day wherever you are. Your mega-cap story of the day is meta. Meta ripping on a report that it is exploring big. cuts to its metaverse. Why is this big news? Well, two reasons. First, meta stock is surging, which is adding about 10 billion in market cap right now, but also because of this. Remember,

meta used to be called Facebook, but it changed its name as a pivot to the business that you are seeing on your screen right now. That is the metaverse. The metaverse for a hot minute was red hot. A metaverse, you know, is where you could put on goggles and walk around. in an imaginary world that kind of look like Legos on acid. You could also spend real money on fake land, and many did. With some spending millions to buy property in this imaginary world, much of that is now likely worth less or worth less. Some hedge funds have been agitating for meta to cut spending on, well, meta.

And so here it is. Kind of a new Coke moment for Facebook's parent company. So let's kick things off with the discussion with Evercore, IASI head of internet research, Mark Mahaney. I saw you laughing when I said Legos on acid. It wasn't entirely untrue. How big of a, if at all, of a business pivot do you perceive this to be? Well, I just love your imagery.

Let's see here. I mean, it's a pretty big pivot. You know, this is a couple. This is, I give this guy credit, Zuckerberg. I mean, he pivots, he pivots fast. He moves quickly. He did this three years ago. not only as he move fast and break things, but when things aren't working well, he's had some

patience here. I think we've done like 70 billion in losses out of Metaverse. So that's a, that's a lot of patience. But I think what's more interesting is this is kind of not so much of a sign that the Metaverse looks a little less interesting, but relative to AI and GenAI and superintelligence, it's massively less interesting. And so I think this actually makes a lot of sense to me that the company is pivoting, cut back some of those losses. I think there's very few investors, if any, that want them to continue these kind of losses in the Metaverse. Cut those back. Go after the superintelligence opportunity.

You've got this wonderful asset out there, meta-AI that's got very limited use, but it's got dramatic reach and, you know, improve the functionality of that. Like, the market doesn't view Meta-I as a digital AI or an AI leader, but it should well give them that, you know, given how well meta in the last two years has deployed AI to improve both its user interface and its advertising interface. The fact that the market isn't giving them enough credit for this next pivot, I find a little surprising, and that's the opportunity in the stock. So I'll just stop there. I like the stock here, and I like the fact that they're leaning in now and getting rid or cutting down those Metaverse losses. Absolutely right move to

do. We were talking last hour, Mark. It's good to see you with another analyst who said, basically he thinks the investment overhang is just going to stay there for quite some time. So even if this all pays off down the road, they're just not getting as much of a revenue lift right now as some might want to see. What do you think about that? I think that's true. I think that's an astute statement. You know, the company that's got the broadest ability to monetize AI is probably Google,

just given how many different properties they can deploy AI, just, you know, either enterprise, consumer, infrastructure, app improvement, et cetera. So they can monetize better than anybody else, probably. And Amazon may be pretty high up there, too. Meta doesn't have as many monetization opportunities. But they do have a track record. Look, they have used AI to dramatically improve their, not just their, not just the performance of the engagement of their apps and the spend with advertisers, but their actual monetization.

And so, yeah, I think that's sort of been overly discounted. Now, you know, we're starting to come back into the kind of the full multiple that meta should carry, which is probably somewhere in the mid-20s, 25 times earnings roughly. So you've still got a little bit more upside in the stock. But, yeah, the market's going to be a little skeptical until we get a little. a little bit more evidence that there's a there when it comes to super intelligence. What I love about this move is what you just referenced, Mark, and that is Mark Zuckerberg's willingness and ability to pivot quickly.

I'm not saying three or four years as quick, but in business terms, it is. They realized clearly they were spending too much money. They weren't getting the return on investment. I mean, they changed their freaking name for Pete's sakes because of this. And now they're basically saying, we're not done with it, but it's just not becoming what they thought from a management team perspective, I would imagine that gives you some bullishness. Yes, it does. Also, I don't think we're going to be changing names. I don't think we're going to be going back to the old name because this is a company with

three very strong brands, one of which is underapp appreciated by investors. There's Facebook, there's Instagram, and then there's WhatsApp. Love my WhatsApp. Which is, that's right. And it's, by the way, don't tell anybody this, but that's the single largest, most popular app in the entire planet. And it's dramatically under monetized. And so there's a really interesting opportunity for meta there. It's something we dug into very recently in a research report. And then there's this kind of, then there's this fourth area. It's this kind of meta-AI digital assistant.

Like the killer app for consumers and enterprises is not out there yet. ChatGPT and Gemini are wonderful apps for information retrieval, information analysis, deep research. But there's the task element to it that isn't quite, nobody's quite. solve that yet. And I'm not sure that meta will be able to do it, but they have a shot at it that I think is underappreciated. So I think there's at least three, maybe four brands that are really here and they'll keep it under the meta name as they should. And yeah, I do like this pivot that Zuckerberg is making. Speaking of Kelly and apparently the world's favorite app, WhatsApp, is meta more valuable with Instagram, WhatsApp, Facebook, AI, and I guess the

Metaverse combined? Or is there more value in the sum of the parts? Could they spin off these things? I know they only bought them a few years ago, but I'm just wondering how they all play together. Well, in some cases, there's an enormous amount of synergies in that a lot of people who use Facebook, you know, use Instagram, maybe not so much the other way around. So, you know, just the more data you have on an individual user, the more that you can provide something like a personalized experience both in terms of content and in terms of advertising. I mean, people want personalization. Nobody wants junk mail. So to the extent junk content. So the extent that, you know, you can use data from multiple different assets to personalize, you know, a user.

I think there, I think there are those kind of synergies. But beyond that, I'm not, I'm not sure that they're, oh, I guess from an advertiser perspective, yes, you're going to advertisers and saying, you know, tell us your, we've got a lot of inventory to offer you, a lot of potential targeting to offer you. Tell us what your goals are. Tell us your spend amount, your spend limits. Tell us what your ROI goals are. And we can spread that across a couple of different platforms very efficiently. That's a pretty good pitch to marketers. It's actually one of the best pitch, maybe the single best pitch to marketers out there today. Well, in that case, they should be able to reap more of those advertising gains, I think, whether, you know, investors, Mark,

would like to see that be 2026. Yes, they would. They would. All right. Mark, thanks for joining us today. Good to see you again. Good to see you, too, Kelly. Mark Mahaney, Evercore, ISI. Still to come, the bidding war for Warner Brothers Discovery is heating up, but what will the winner get? We'll discuss that ahead. Stay tuned. You're watching Power Lunch.

A frontrunner is beginning to emerge in the bidding war over Warner Brothers Discovery. Source is telling us that Netflix is that leading bidder. its offer reported to be 85% cash while competitor's Paramount Skydance's bid is apparently in all cash. And because of that and some other allegations, Paramount Skydance is calling foul on the sale process. According to a letter reviewed by CNBC, Paramount attorneys questioned whether Warner Brothers discovery is acting in the best interest of its shareholders by going with what it views as a lesser bid. It is complicated. It is a little bit confusing. but bottom line, it's getting pretty ugly in the fight over big media. And it seems like this deal could end up in court.

Let's talk about it all with Matt Bellin. He is founding partner of Puck, also the podcast host of The Town. Matt, I looked at the letter as well. The language, again, not a lawyer. I do have a law degree. I would say this. It seems like they're priming for a lawsuit if Warner Brothers goes with the Netflix bid. Would you agree with that?

I would, as also a former lawyer, I would say this is what you do as a pre-litigation letter. But I also think that they are targeting these independent directors at Warner Discovery and basically warning them saying, listen, you might be hearing something from management. David Zazov, the CEO, is on that committee steering the transaction here. You might be hearing something, but you've got to do the best deal. And they're specifically targeting this report in German media. that executives at Warner Discovery have specifically been lobbying against Paramount as the buyer for the company.

And if true, that would be a pretty improper overstep in this regard. I'm curious where we think this will leave them, why the investors, Matt, seems so unhappy about it with the shares near an eight-month low. Well, this entire saga is pretty upsetting for, I think, the Netflix shareholders, they're looking at this saying, well, why are we doing this? And what, you know, we have such clear focus here. Why are we going after this asset that we don't particularly need, or at least the management has not articulated the reason why they need

this asset? And then the prospect of getting into prolonged litigation here, I think, is not great for if you're a Netflix shareholder when they've really been on a role. Now, obviously, there are reasons why Netflix would want these assets, the intellectual property of of the Warner Brothers studio is pretty powerful, and that 100-year-old library could power Netflix in a way that would really supercharge its business, plus it would give a control of HBO Max, which they could either shut down

and eliminate a big competitor, or they could operate separately or put it at the tile on Netflix, or all sorts of things. It would really give them a boost, but obviously that's what Paramount is making the argument on anti-trust grounds here about, is that this would be the most powerful

streamer gobbling up a big competitor, whereas they argue at least, the Paramount transaction would be a little bit cleaner. It would be one studio buying another, taking five buyers down to four, but they believe they have a path through the Trump administration to get that approved. Yeah, because regulatory issues are an issue. Some of that might involve are currently parent company Comcast. You can comment on that, but also comment on this. What ends up happening to CNN. Okay, CNN's a brand. I've got a lot of friends.

I'm sure Kelly does too. You probably do too, Matt. This is kind of being tossed around inside. Everybody just talks about the movie theater, movie studio, the IP of Warner Brothers. Nobody talks about CNN. What happens to that? Well, to be clear, the Paramount bid is for all of the company, including the assets in the cable universe, which includes CNN.

So if Paramount wins this deal, they would own CNN. And there's been talk about... You merged out with CBS, which they all, right? CNN and CBS kind of merge. They all CBS. There's talk about potentially combining the news assets there. And obviously, CBS has gone through a transition recently where the perception is it's become more friendly to the Trump administration. They would argue it's more down the middle.

But people believe that if CNN comes under the Ellison family control, it would probably become more conservative or more or less of what it is right now. Now, Netflix doesn't want CNN. They don't want the cable networks. They just are bidding for studios and streaming, and that would mean that the other assets would go to this new Discovery Global Company, and they would figure out what to do, much like Comcast is figuring out what to do with its cable networks via this new Versant spinoff. Comcast has not been involved in this fight right now. I think they're probably, a lot of people have asked me, like, why isn't Comcast arguing that both of those bidders would be anti-competitive and that they are the one that could really get this done and make it something out of Peacock and make it more of a scaled product to compete? We'll see if Comcast enters the chat here.

And today is Versant's Investor Day. It's funny how it all comes together on the same day. Matt Bellany, Up Puck and the podcast of Town. Matt, thank you very much. Thank you. And before we go, take a look at these space stocks blasting off on a report that Sam Altman explored a deal to build a competitor to Elon Musk's SpaceX. Coming up, our market navigator says it's time to buy the worst performing mag-7 stock of the year, which is actually Amazon. He'll explain his rationale next.

with the Dow down about 150 points. Small caps are actually the outperformer today. Although, again, as you can see, the market tone has shifted a little bit to the downside at the moment, Dom. All right, session lows, as you point out here, Kelly. But in our market navigator today, we're going to talk a little bit about Amazon

because it has been lagging its big tech rivals so far on a year-to-date basis. Shares are up only about 4% in 2025. The worst performer, relatively speaking, of that mag-7 group. But our next guest says he's bullish on the company and he thinks it's headed for one of the strongest setups in its history. So joining us now with the case is Matt Powers, the managing partner

over at Powers Advisory Group. Matt, this is an interesting call here because there has been a mean reversion trade that hits many parts of that mega-cap tech market on a rolling basis over the last few years. Why is it Amazon's turn now? Yeah, Don, thanks for having me. I appreciate being here. Yeah, Amazon, you know, it's one of the most interesting names in the market right now because you've got a Mag 7 company, and I may sound like a broken record because Because, you know, we're always looking at solid entry points into great companies. I say that quite a bit. Notably enough, even though it's a MAG 7, we think this is one.

It's a pivot from the dividend stocks we like to talk about since it doesn't pay one, but you really have two sides here. So you've got the retail side and you've got the tech AI cloud side that we're looking at. And we just feel like the market still isn't pricing that blend in correctly. And I kind of want to bring this down to an understandable level. Now, what exactly, though, is that driving force behind why this could be a kind of mean reversion to the upside or catch-up trade, if we are to focus a little bit more, say, on that

AI component and web services and cloud computing component that Amazon has as a migger growth mechanism versus its retail side. I mean, if you look at it purely as a retail company, we know it's not. It's got a better valuation of Costco and Walmart. We know that, but it's a perfect week to talk about that because we're closing one of the more important retail weeks of the year. So from the retail angle alone, they're in a dominant position. But when people think about Amazon, and again, an understandable level, you're thinking brown boxes on your front porch, right? So the part that's missed here is that the real profit engine isn't from retail at all. It's AWS. It's the cloud service. So retail drives the revenue, but AWS, it drives their

bottom line. It's only about 18% of overall revenue, but it's almost half of operating income. And they just posted 20% growth in this, which is the fastest in three years last quarter. So AW, it's still the largest cloud provider in the world by revenue and market share, and they literally work with everybody. They work with Goldman. They work with Pfizer, BMW, Adobe, Netflix. And it's the backbone of Enterprise Cloud. And when you get into the AI side, we know that this week, Amazon's kind of stepping further into the chip game with its new Traneum 3 processors. And they're set up for more than four times the performance of the predecessor. And it's just a clear move to go head to head with Google and Nvidia and the goal is to give companies faster, more cost-effective way

to train and run their models. But they are AIs everywhere. They've adopted it everywhere. For retail, you're looking at the buyer side, the seller side, throughout their logistics. I mean, it's its own massive advantage. And part of the reason that the stock price is down and the lowest performer is that they're also, they have the most KAPX this year. You know, they're guiding for $100 billion of KAPX this year to build out AI and cloud capacity. So that's where they fall within that Mag 7. All right. So everybody with an A-L-E-X-A device knows that she's gotten a voice upgrade, apparently. so we'll keep that in mind as well.

Matt Powers, thank you very much. Kelly, Brian, I'll send things back over to you guys. I see what you did. You didn't want to say the word because then it might trigger those devices in people's homes and then they could order like toilet paper. Yes, just like my kids do right now. You would never want to do that with Alexa play down east or Alexa.

Oh, you just said it, though, now. What's that? A-L-E-X-A. Thank you. You got it. Coming up, a big call on Big Banks, influential analyst Michael Mayo, joining us next with his outlook for next year

and the one stock, he says, is going to rally another 20%. Welcome back to Power Lunch. The major averages are largely unchanged today, but the major U.S. bank stocks are seeing some nice gains. J.P. Morgan up 1.3% today. You've got gains for City, Wells, and Morgan Stanley also. One of the factors that's been driving them higher lately, the new note out from Wells Fargo, saying they remain bullish on the Goliath banks for

2026 and believe the sector is still undervalued compared to the rest of the S&P. Here I said to break it all down is the author of that note, Mike Mayo, senior banking analyst Wells Fargo. Good to see you again. Thanks for having me. I was shocked to read that Goldman, is this true? Is this up 40% for the second year in a row? But no, second year, therefore the first year after the first.

Them and BNY, Mel and Mike. So we've seen some really strong bank gains already, but you think this is still. and undervalued group. Yeah, well, as it relates to those, like for the Goldman's or Bank America or Morgan Stanley or J.P. Morgan, Goliath is winning. So Goliath is winning in capital markets. Capital markets are strong, especially over the last decade. The U.S. big banks have extended their lead versus everybody else.

So that certainly is winning. But the broader theme here is Goliath is winning in most areas of banking. And so that's why the best performing bank stock this year is Citigroup. It's been our number one pick, our dominant number one pick. And we came out with the report today, and Citigroup is our dominant number one pick for 2026. Wow, really? And they've outperformed. There's other banks that you named.

I think they'll continue to outperform. And it's not like they're doing a great job. Well, the stock is still only at what we would all remember $10, you know. So it's so strange to hear you say that. I guess both things can be true at the same time. Well, they've had value destruction for this entire decade, returns below the cost of capital. They don't deserve to exist if you generate single-digit returns. But, you know, the stock market looks ahead.

So I think they're transitioning from value destruction to value creation. In fact, the longest period of value creation in two decades, since before the global financial crisis. That's the key point of what's happening. And I think the stock market is looking ahead. And that's why I think it's going to be the best-performing bank stock in 2020. Wow. I'm a little confused, though, because you just said also, you said it's going to be the best-performing bank stock, but then you also said, but they're not doing a very good job. Well, if you generate...

How can you have both? If you generate single-digit returns like cities done this decade to date, you don't deserve to exist. The banks should be liquidated if they're going to generate returns like that forever. So they have worse-in-class returns, worse-in-class efficiency, and they still have... worst-in-class stock valuation, but this is a huge inflection point. So now I think they generate double-digit returns next year, and I think that continues to go higher to the rest of the decade. And I know we have an upside of 20% to our stock price target, but this stock could double over the next four years. So it's the, or is it the nowhere to go but up theory? And then what is

Jane Frazier, the CEO of Citigroup doing? So I know she's been cutting costs, cutting costs, shrinking the bank, shrink in the bank. What is she doing that? makes you confident that those returns will go from single digit to double digit. Well, look, people said, so most investors that I spoke with said last year they were going to implode because they were doing so many activities at the same time with their restructuring. I mean, they had their big org simplification project going from 13 management layers down to eight. I mean, that's kind of crazy.

And reducing their complex global matrix structure to lines of business. Then they also have their exits of consumer activities in 14 countries around the world. They're almost done with that. And then they have their transformation project where they're modernizing all that technology that never got updated when you had all those deals back 20, 25 years ago. They did all three activities at the same time. And guess what? They not only met their targets.

They exceeded them. I think they'll exceed their targets for this year. And that sets a nice platform for kind of escape velocity from value destruction to value creation. That's probably the most attention-grabbing call of yours. But when you say Goliath is winning, pretty much all the banks were talking about are by definition big, right? They're the biggest, they're the brand names. Scale helps so much, I guess, in this business. Does that by definition mean you're leaving out the regionals? You're not really interested in that kind of play? Because some might say rates coming down and some of the macro things going on that you might get more beta

with that group. I don't know. Well, there's a simple answer, a tougher answer there. So the simple answer is, Goliath is winning. You're seeing scale benefit in consumer banking, in commercial banking, in capital markets, in tech, and AI. And so the simple answer is, Goliath wins everywhere. Goliath is winning over the next year. The more complex answer is you've had 50 years of reversion to the mean. Every time a company looks like they're phenomenal, they come back down to Earth. So right now, the largest banks trade at the highest valuation premium versus the rest of the industry, almost in history. Really? So the question is, does that reversion to the mean happen again? Or is this permanent escape velocity for the biggest players versus the rest of the

industry? I mean, I go to my corner, you know, deli, if I want some gatorade every couple months. But if I'm doing my shopping, I'm going to the grocery stores. I'm wondering if it's, if that analogy holds. And if it does, then the biggest banks will continue to expand their lead versus the rest of the industry. Makes sense to me. 13 layers of management down to only eight. It's like a cake and then it's still a giant. It's just bigger than you go down to this.

Mike Mayle, we've got to leave it there. Look forward to having you back on soon. Thank you. Let's talk about bonds. And let's talk about Japan. Because have you been listening to Rick Santelli for the last few weeks? And I hope you have. You know he has been all over one big story in the super spike in borrowing costs in Japan.

bond yields there, hitting their highest levels, is 2007. And that could also be a big tell on our markets as well. Rick Santelli is here now on the bond report to tell you why. Absolutely. You know, we always have to talk about global rates. They're a big star in this kind of play that we're looking at globally. But let's start with 8.30 Eastern this morning. And this show jobless claims, $191,000.

Basically, the least amount. out in 39 months going to September of 2022. Now, many say accurately, well, we had a holiday Thanksgiving. Things always get distorted when you have one less workday, but there's something called seasonal adjustments. And that process is supposed to take care of a lot of different issues like that and a lot of different numbers that the Bureau of Labor Statistics puts out. Just consider the cycle of school teachers in the summer. Like all these things are supposed to be seasonally adjusted. So if it's a problem this time, maybe it's a problem with all seasonal adjustments, something to think about.

But nonetheless, that move had ramifications in all markets. Look at a 12-hour chart of two-year and 10-year. You could clearly see at 8.30 Eastern, both of them spiked higher. And you want to pay attention to how markets behave on key data points. Look at the dollar index. Right in the middle is that spike. Now, granted, it got a little muddy, but look where it's hovering now, pretty much right at or higher than that spike at 830 Eastern.

And finally, back to the topic that Sully talked about. Okay, our low yield close of the year was October 22nd. Let's pick that date and do three charts. Okay? Now, what I want to look at is the one that's up 28 basis points since then. That's the Japanese government bond. That's the number one, the one that goes way up. it continues to go up almost on a daily basis. Number two, boons, up 23 basis points since we made

our low yield close of the year. And then finally, and last place is the U.S. 10 year, up about 14 basis points. The point here is that whether it's issuance, fiscal issues, or just a general slowing lackluster economy, all these reasons of rates going up aren't the reasons that investors used to like in the old days when your economy's all juiced up and rates go up. This is for more negative consequences, especially in Europe and Asia. Sully, back to you. I love it. It was like a global lesson in the bond market. Rick, we love it. Thank you. All right. Here at home, Dollar General stock that is surging. It is leading the S&P 500. And Dollar General on Pacework's best day since June. Your next guest says this stock belongs

in your portfolio. He'll tell you why and give you some money. other names as well in your power check. afternoon. Dollar General hitting a new 52-week high, leading the S&P today. It's now up 12% after that third quarter earnings beat. Jay Woods is here. We were just mixing it up with him. He's the chief global strategist at Freedom Capital Markets and a CNBC contributor. Feel free to sprinkle any analogies you'd like throughout this discussion. So Dollar General, Jay, what's your call on this? Yeah, the discount retailers have been on fire. Dollar General was up 48% coming into today's earnings. And to me, it's just starting to turn around. This was a sector that had been beaten down

for years. And then we were concerned about the tariffs. And then John Oliver did an expose on them of the whole people. And, you know, the stocks were under pressure, but they turned it around. They've tightened up the stores. Same store sales are moving along. And then with the K-shaped economy, what's going on? The high-end consumers actually shopping at the discount retailers. And then the normal shoppers are getting their everyday needs there. So discount retail is doing extremely well. And technically, when I look at this on multiple timeframes, it just, just broke out, gapped above 120, 116 was the level I was watching. It still has a lot to reverse.

I think this stock could go to 150, 155 over the next three to six months. So it's somewhere you want to be. I think they're back. Yeah, I like it. No qualms about it whatsoever. A big turnaround story after some years of underperformance. What is going on? Is it steris?

Starris. Starris. Starris, thank you. Steris. Is it? Medical devices. Up 25% this year. Okay.

Yeah. So medical devices is a sector that, you know, is starting to turn around. We talk about health care. That's starting to turn. Biotech's been on fire. The other chart, the I-H-I, starting to break out. And what are the stocks leading it? I talked about this on CNBC Pro.

So did Katie Stockton. So I like that we're both in the same camp. So when you look under the hood at some of these medical device stocks, IDX has been leading, the largest company in Maine, pet veterinary supplies. That's random but interesting. It is. It is. When I come to you, I bring.

You're going to bring it. Bring a lobster roll next time for talking about Maine. All right. Well, I didn't even know I was going to talk about. Idax. We're focused on Steris. Starris is up 26% year-to-date. Relative strength against the medical device sector. Looks fantastic. And let's just talk technicals. On a yearly basis, on a five-year basis, 250 is the level of watch. So from a risk-reward point of view, and that's how I like to look at trades, you can get in this name. It's not going to be super exciting, but it's a good

name over the next 12 months that you want in your portfolio. If it breaks 240, that rising moving average, then maybe you get out. You take a little loss. But long term, I think this stock has turned around, great breakout, great upward trajectory. All right, maybe not as high conviction as dollar general, but definitely one on the list. Yeah. Which brings us to CrowdStrike, which is up 50% this year and just raise guidance again for fiscal 26. What do you see here? Yeah, and it didn't raise it enough because it actually fell after earnings. And to me, it gives you opportunity. Because when you talk cybersecurity, to me, the poster child, the juggernaut, is CrowdStrike. This stock is in a beautiful

up trend. It's channeling. It's pulling back. You use the moving averages as levels that you want to watch. The 50 day, it's trending around that. But if it pulls back the 500, I definitely want to get in it. It's something you want in your portfolio over the long term because they do have an AI story. Their Falcon platform on the cyberspace has been tremendous. And then they're battle tested. You don't want to look back and say, oh, yeah, remember the, you know, the Delta outage that they were responsible. But crisis management, they handled that well. They retain over 95% of their customers during that crisis. And now those customers are loyal and the annual returning recurring revenue is just a juggeron, almost $5 billion this year. Fascinating. Big move

to date as well. Jay, thanks. Good to see you. Jay Woods. All right, let's get now over to McKenzie Seagallos for a CNBC news update. McKenzie, what's going on? Hey, Ryan. Attorney General Pam Bondi says there were no new tips or witnesses that led to the arrest of a Virginia man accused of planting two pipe bombs in D.C. five years ago. Investigators say Brian Cole Jr. placed the bombs at the Republican and Democratic National headquarters on the eve of the January 6th riot at the Capitol. Coal is charged with the use of an explosive device. Bondi says more charges could be coming. The Trump administration is making cuts to how long some immigrants can work in the U.S. According to the Wall Street Journal,

people who applied for asylum or are under certain humanitarian programs can now only legally work for 18 months rather than five years. Immigration officials say the move will force immigrants to renew their permits more often and give the government more opportunities to revet them. And the White House is expected to submit plans for a new ballroom to a planning commission later this month. The proposed 90,000 square foot addition would be nearly double the size of the main White House. President Trump has said the project will be privately funded. Kelly, sending it back to you. All right, McKenzie, thank you very much. McKenzie Segalos. All right. So Dollar Tree is your S&P stud of the day. Your dud of the day, the worst stock in the index is Intel. It's actually pacing for its worst day in four months down 7%. Although the other day it was the best performing stock in the S&P 500. All right. Coming up, our exclusive Power City Index, we're going to show you which city stock market so far this year, the best performer in America. I think it will surprise you. It's next.

All right. So, you know, we are nearing the end of the year, and it's a nail-biter as to which city's stock market will win our title of best-performing stock market in America. How do we do that? Well, we do that with our exclusive power city indexes. We built 36 city and metro area equal-weighted stock indexes. We track the return of each, and with about three weeks left in the year, give or take, we have a new leader. It is the Queen City. Charlotte, North Carolina, it's stock market booming this year. It's got a median return of 24.5%. Curtis Wright, lithium miner Albemarle, SPX technology, and new core, all leading the charge for Charlotte. Close second is your leader for much of the year.

That is Silicon Valley. Remember, some of our indexes are metro areas, not just city. For example, San Francisco has its own power city index, but Silicon Valley is rocking. 22.9% return this year, led by App Lovin, Broadcom, Alphabet, and Applied Materials. Rounding out your top three, I love this one, Kelly, Detroit. Ooh, go Detroit. That's right. The Motor City stock market all revved up this year, led by rocket companies, but also GM, Borg Warner, and 4.4.

Ford. The Detroit PCI has a median return about 17 and a half percent. The Michigan auto industry has been red hot this year as car prices and sales of big trucks, SUVs, and vans for families with a lot of kids. Keep going up. While sidestepping any further comment on that one, please make a better one. No, Charlotte being at the top of this list. Yeah, we've looked at it, okay. Ford Econo line? It'd be, yes, mid-roof. The mid-roof. The mid-room. You got up the captain's chair. Obviously, I'm shocked that Charlotte is at the top of this list.

And I was also shocked at the companies and the reasons why Curtis Wright. The aerospace engineering company. Albemarle. Lithium. New Corps, SPX Tech. I mean, good on for that. We don't talk about these companies all that much. But it does tell you.

And we always talk about AI. And I think the whole country has this impression that it's all about kind of the high-tech winners and everybody else. And the fact that Charlotte and Detroit are two of the top three cities in this index. tells you that there are gains, real gains, real companies, real businesses, real GDP out there doing well. Well, I love that you're interested to be. I've been doing these for 10 years, and it's just kind of a fun exercise. They're equal-weighted, the median return, so they're not some sort of great thing.

But there are really, I think, I hope, interesting window into how cities do. Because think about it. If you're in Detroit and you're work for Ford and you own some Ford stock, you're feeling better this year. You're feeling pretty flush this year. Exactly. You can afford a Ford F-150 lightning. all-electric pickup.

No, you can't. No, they don't make them. They don't make them. And even if they did, that price tag was high. But still, it's a great way to kind of flesh out what's going on. Speaking of Detroit, average new car prices have actually surpassed $50,000 this year, crossing that level for the first time ever. And some Americans are rethinking their biggest ticket purchases as they navigate tariffs,

inflation, and a tighter job market. Now the Trump administration is addressing auto affordability directly through new fuel economy standards that could lower regulations for automakers, maybe lower costs. Philaubo spoke to Transportation Secretary Sean Duffy about that this morning, and he joins us now. How much would this say, Phil? Welcome. Well, it depends on how you calculated.

When we talked with the Secretary of Transportation, he says, look, it works out to being about $1,000 per vehicle in terms of the cost savings for the automakers, and he believes that ultimately those cost savings will be transferred to consumers in the form of of lower vehicle prices. Here's what he had to say this morning when we talked in Washington. The auto industry is very competitive, right? We see that. We see offers all the time,

whether it's on interest rates or on incentives to buy. So, yeah, listen, this is market-driven. And so, yeah, lower prices mean more sales. And by the way, if we bring prices down and we get newer cars on American roads, newer cars are way safer. We save lives. Now, you might be saying to yourself,

well, wait a second, how are they going to save money? They won't have to spend as much on things like zero-emission vehicle credits or investing heavily billions of dollars into the development of electric vehicles. And in theory, they should be putting their efforts into meeting the broader market when it comes to either hybrids or internal combustion engine vehicles. They can still build electric vehicles if they want. But the emphasis the White House believes will be on internal combustion engine vehicles and more affordably priced once.

We'll see if that happens, guys. You know, there's a long history in this country of deregulation, in theory, leading to lower prices, and it doesn't always work out that way. And the bottom line, Phil, is this would be an area where people might experience a big change if you no longer have that automatic braking or turnoff technology. But would it be more...

Well, yeah, that's a separate story, and that's going to be playing out in January once you start to see people on Capitol Hill holding hearings talking about should there be fewer regulations requiring some of this technology, safety-oriented technology? Am I the only one that views that auto-off feature as Satan's spawn? It's the first thing I usually turn off when I start the car. I'm not, there's no, nobody, we're going to get added because people are going to say, oh, you're going after the environment, whatever.

I just don't know if it helps because I know, Phil, that the way combustion engines work is they tend to use the most fuel when they start or under load. And I just wonder, is that really saving any fuel? fuel and therefore emissions. Does it work? Well, I mean, the argument, Brian, would be that a lot of the problems that you had with greenhouse gas emissions, as well as fuel consumption, happened when you were idling at a stoplight for an extended period of time. Fair. I don't know the exact math in terms of this, but we do know that the industry has moved in that direction. And we'll see if some of these changes are things that we've seen put in vehicles are reversed. I think that there are

some people who would say, sure, some of these should be reversed, there would be other people who would say, look, that automatic emergency breaking is designed to save lives. Now he gets into a cost analysis in terms of how many lives might be saved versus how much the automakers would have to spend to make that technology uniform by 2028. Yeah, I just, I don't want to make too much of it, but it does seem to be a thing either way. The idling, I get your point. Thus, by the way, also the reason why we're going to so many roundabouts. Have you noticed this? Kill the traffic He's going to roundabouts. No, a lot of places are now killing traffic lights and going to roundabouts, right?

Phil, so that you don't stop at a red light and thus you don't idle, you can kind of keep moving. These are the little things that you can do, help the car industry, but also reduce emissions by keeping cars moving and always stay to the right unless you're in England. They're big in Europe. They're big in Europe, you know, and things in Europe and Asia. By the way, microcars are also big in Asia. We'll have to talk about that sometime. We talked with the Secretary of Transportation about that. The president wants to see them here in the U.S.

We talked about whether or not that's likely any time soon. A topic for another day, a fun topic. It is a fun topic. Also a great song by the band, Yes, off Fragile. Philobo, thank you. You bet. Prague rock, no? No, I'm more anti-turnerounds, roundabouts.

You don't like the roundabouts. No, who likes them? Me, because you don't stop. You keep moving, and no one else knows what to do. So if you just power through, they have to stop, otherwise they're going to hit you. You're probably the reason I don't like that. Go right over the hump through the middle. Don't even go around it.

Go over the hump. All right. Coming up, don't do that. I'm kidding. J.P. Morgan says it is time to buy this stale stock. We'll reveal the name. It will be the roundabout. Next.

The stale stock reference was appropriate because it was J.P. Morgan Chase saying, should buy shares of toast. The restaurant payment company, you see them everywhere, you tap your card, toast. JP Morgan Chase upgrading that stock. They think 20% upside from here. Scan that QR code if you want to find out more about why. Meantime, the billionaire club, it's expanding, according to a new study from UBS, with a record 2,900 billionaires across the globe now controlling or worth a staggering $15.8 trillion. Well, shouldn't the numbers always go up because dollars inflate? Yeah, well, and there's lots of innovation.

There's huge market cap company. How many billionaires has Nvidia alone created, right? Or Charlotte. Exactly. Or Detroit. Or Detroit. Rock City. Thanks for watching.

Closing bell starts right now.