The Dividend Cafe - Thursday - April 16, 2026

Episode Date: April 16, 2026

On April 16, Brian Szytel reviews a continued market rebound, noting 12 straight days of Nasdaq gains and the S&P closing above 7,000, with the Dow up 115 and bonds relatively unchanged. He cites positive drivers including double-digit earnings growth, record-high margins (19.7%), tax refunds up 28%, easing bank capital requirements supporting lending and liquidity, positive GDP and improving productivity, and both services and manufacturing in expansion, offset by geopolitical volatility, oil-driven inflation, and a waffling labor market. He addresses a question about Anthropic’s Claude being labeled a government security supply-chain risk, highlighting resulting contract loss, ongoing legal proceedings, and broader AI regulatory risk, but argues the bigger issue is AI valuations—citing implied ~$800B valuations versus ~$30B revenue (~25x revenue). Economic data were mixed but tilted positive. 00:00 Market Rally Recap 01:11 Why Stocks Keep Climbing 02:28 Risks and Offsets Ahead 02:42 Anthropic Claude Controversy 04:07 Regulation and AI Adoption 05:19 AI Valuations Reality Check 05:59 Economic Data Roundup 06:31 Closing Thoughts and Q&A Links mentioned in this episode: DividendCafe.com TheBahnsenGroup.com

Welcome to the Dividing Cafe weekly market commentary focused on dividends in your portfolio and dividends in your understanding of economic life. Good evening and welcome back to Dividend Cafe. Brian Saitel with you here as your host again on this Thursday, April the 16th, day after tax day. And I hope your tax filing was a smooth one, or at least your tax payment. We had some follow through in markets, actually, which is nice to see. This has really been a robust recovery, frankly. We've gotten 12 straight days in a row of both the S&P and the NASDAQ higher. The S&P closed above 7,000 again for the second day.

So NASDAQ, I'm sorry, is up 12 straight days. So that's robust. And so you're seeing this recovery take hold. The market continues to climb that wall of worry. And I'll go through some of the reasons as to why. But with a ceasefire in place and lack of, frankly, bad news on the Iran and U.S. front, you're getting the bias to the upside overall and risk assets. across the board. So on the day, you had the Dow close up 115 points. S&P was up about a quarter of a

percent and NASDAQ was up a third of a percent. Bonds are still roughly the same. Ten year was up three bases points. So you're getting a pretty benign move in the bond market and then just a stock market that's drifting higher and closing at all-time highs. So there you have it. Some of those positives that I mentioned, I'm going to go through them with you here. But aside from the stuff going on in the the East that has raised increased energy prices, caused volatility, all that stuff that you know about. We're in the middle of a ceasefire and they're working on a negotiation tactic. But the things that are positive, earnings remain to be growing at double digits. Margins are at all-time highs, call it 19.7%. That's the highest that we've ever seen. Tax refunds, which have now basically been

fully paid out or in the process of being paid out, are up a stunning 28% over the last year. That's a lot of money going back into bank accounts, and it's a money that has a high velocity to it. People go spend that stuff. It's not going into savings. That drives the economy. You also have lower bank capital requirements that are coming down the pike. That's going to increase the ability for banks to lend. You may see some large lenders get into the private credit space, too.

Either way, it's more liquidity. That's a good thing for markets. You've got positive GDP. You've got productivity that is advancing, and you can say that's from AI yet to be seen. but it is starting to creep into the productivity numbers. And then you have both services and manufacturing that are both in expansion territory. So those are all the good side of the ledger, and it's pretty robust. That's why markets are all things being equal biased to the upside.

Now, the offsets to those things are going to be the volatility in geopolitics. You've got the increase in inflation because of oil. And then you have a waffling labor market. Those things are less negative than the others are positive. And so there you have it. But the question in there today was, a popular topic and an interesting one. It's about this AI company Anthropic and their AI model that's called Claude and their latest releases, which are called Mythos, to add another term for you.

So these tools are very powerful. They keep getting more powerful. The tool itself is writing some of the software to advance itself, which is pretty fascinating. But the government is listed at a security threat. And so that is called the supply chain risk. And this has happened over the years and many different companies, private companies, and public companies. If you remember, Yahweh and things like Alibaba, in different periods of time when there's TikTok, all that kind of stuff on the Chinese side. But this is the first time that a U.S. domestic company that is private, not public, has been given this label. And obviously, the company doesn't like it because they're losing the revenue of all of the government defense contracts. And of course, the government is now

no longer able to use it because they were refusing to give the government full access to it to use for whatever they sell fit, call it surveillance, call it targeting or weaponry. And there's, I think, a positive takeaway, which is that there's some sort of moral backing on how these companies want to have their technology used and not used, and it's a private company, and this is America, so they have every right to do that. But there is a legal proceeding that is ongoing with it? And the question is about what does it mean? And is there a risk to the market in general with AI. And my answer is what I just described, but also in addition, you're going to have regulatory environments that change. This is a new technology, and it's

basically parabolic coming onto the marketplace, and it's advancing. It's such a fast clip, faster than I think some are understanding even how best to use it. And then, of course, with the good guys using it for good things, like margin expansion and operating leverage, you have the bad guys using it to impersonate and to create fraud and all the stuff that is out there. So there's a back and forth in regulatory environment and legal environments and governmental involvement and all these things. There's a natural byproduct of how it will be shaped. So that is ongoing. But what I can tell you is, while those things may be an impediment to what is essentially an extraordinarily expensive part of the market already with AI, I believe them

to be marginal because I think that the power behind it and the adoption of it, you can say that it's evidence paradox, meaning the more people that end up using it, the less of costs, which means the most people that end up using it, take hold. But like Anthropics revenue has gone from $9 billion to $30 billion since the government announcement itself. So you can't really say that it's slowing it down. It's up threefold. That said, the real question is about valuation, because whether it's the Open AI story or this Anthropic deal, you've got valuations now topping $800 billion. When you think about a $30 billion revenue number divided by $800, you're talking about 25 times revenue, not earnings, there are the earnings. So this is revenue. So it's

crazy, crazy talk. But the answer is at some point, well, they grow into that. And that's to be seen. We saw the same thing in the dot-com era. Some companies went to zero and some grew into it, but it took 15 years. And that's the real question. So that would be the more pertinent one versus the security issue. I think that they'll work those things out over time. There was actually a few pieces of news in the economic calendar. Some of them I went through, but a few that I didn't. initial jobless claims were a little stronger than expected at 207 versus 215. That number has been about the same now for many weeks, so we'll call that good. And then there was a very strong manufacturing survey out of Philadelphia region,

much stronger than expected. That's also good. But then you had industrial production that missed slightly. It was down half a point versus being flat. So a bit of a mixed bag, but I'd still chalk it up to being tiered towards the positive side on the economic calendar. That's what I have for you around the horn. That's what went on in your.

market day, again, generally positive. And that's the answer to your question for the day. So reach out with more of them. We always appreciate them and have a good evening. Thank you. The Bonson Group is a group of investment professionals registered with Hightower Securities LLC, member FINRA and SIPC, and with Hightower Advisors, LLC, a registered investment advisor with the SEC. Securities are offered through Hightower Securities LLC. Advisory services are offered through Hightower Advisors LLC. This is not an offer to buy or sell securities. No investment process is free risk. There's no guarantee that the investment process is a free risk. There's no guarantee that the investment or investment opportunities referenced herein will be profitable.

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