good afternoon, everybody. for a monday afternoon, welcome to "power lunch. along with frank holland, i'm tyler mathisen tech stocks are climbing back from their recent lows but a top analyst says the correction isn't over yet he'll explain why. plus astrazeneca's vaccine data showing it is 79% effective in the u.s. as it awaits

emergency authorization use. we've got details on that one. later, arc investments kathy wood out with a new price target on tesla we'll explain why she thinks it is heading to the moon "power lunch" starts right now welcome to "power lunch. i'm frank holland with tyler mathisen stocks are higher across the board as the 10-year yield retreats from its recent highs the nasdaq up nearly 2% and the market reaching a critical point, as it's been a year since its covid lows mike santoli has much more on that hey, mike. >> yeah, theenvironment could hardly be more different if you look back a year on the s&p 500, it's tomorrow actually, the anniversary of that climactic low in the s&p 500 people were running as fast as-week-old away from stocks it was the fastest-ever decline of 34% which the s&p got to. we've seen this massive run

since. we got at one point to an 80% increase over the intraday low of that date back then the prudent thing was actually raise your exposure to equities it's rare that the market gives you that opportunity what did people want instead of stocks back then look at the bond market. this is an etf that owns the entire bond market when this goes up it means people are buying bonds as fast as they can, yields are collapsing this has been the opposite since. so you've seen a very historic decline in bond values if you annualize what we've done in the bond market it would be the worst year ever for bonds. does that mean you rotate from strong stocks into weak bonds? it's not entirely clear that's necessarily the right thing to do but perhaps you should think whether or not you're overexposed to equities. take a look at the s&p these lines show you where it was 50%, 1983, once in the late

'90s and also 2010, which is interesting, coming off a major low in 2009 and of course right now. what you have seen is flattening out, some choppiness eventually, but it was not the end of the bull market. it was not as if it was some kind of final peak in the market but maybe you should reassess allocations. people are saying instead of bonds, dividend growth stocks are maybe underloved and make a little sense in terms of getting away from the pure growth or pure value type trade we've been seeing for a while, tyler. >> michael, thank you very much. mike santoli let's talk a little about tech stocks, shall we they have been bouncing back today. so is the tech correction of late over or not with the outperformance of unprofitable stocks and sky-high valuations, our next guest says it's not over yet. joining us now to discuss is tony sakanogi. what gives you heart with technology shares right now and what gives you heartburn

>> sure. thanks for having me, tyler. look, the positives are that the secular growth story for much of tech is intact it was very strong for a number of companies because of covid last year in 2020. but this year, you know, there are a lot of tech stocks that lagged much like the broader recovery at play, they may participate. so -- but just generally, secular fundamentals for technology remain good long-term expectations for tech stocks are broader than the marketplace and that's positive. you're paying for that tech overall is about as expensive as it has been since the technology bubble. what we try to highlight in our note today is the most expensive technology stocks, the top 20% of technology stocks are trading at an average of 17 times revenues again, that's higher than it's ever been outside of the technology bubble. when we look back at 50 years of

history, stocks that traded those kinds of elevated levels typically don't do very well over three and five-year periods, have very low hit rates and so that's the concern that we have. >> hey, tony, your stock picks from tesla to apple to ibm, they all get a significant piece of their revenue from hardware. how concerned are you about the chip shortage going forward? >> generally speaking, i think hardware stocks over long periods of time have not feared nearly as well as services and software stocks. typically we encourage investors to have an underweight in traditional hardware companies so hardware companies include apple but also include ibm and hp and dell, et cetera secular growth is not as strong in hardware as it is in other technology sectors as far as the chip market, i think the market understands that to some degree. the market is looking past and trying to think about what

normalized growth is for most hardware companies, the challenge is can they grow obviously not for tesla, that's an electric vehicle and automotive company that i happen to follow, but more broadly in terms of technology hardware companies, the top line issue is sustained growth going forward typically the market will look through things like chip shortages. >> let's talk a little bit about the fact that in your report you point out that actually there is a higher percentage of a certain class of tech stocks that are unprofitable today vis-a-vis the tech bubble. that is very worrisome, as someone who remembers exactly that scenario back in '99 and 2000, '01. >> that's exactly right, tyler we look at the top 1500 stocks in our universe. within that about 300 of those are technology stocks.

of those roughly 300 technology stocks, about 110 of them did not make money last year that's about 38% it's higher than it was in march of 2000 when it was 36%. so part of that is driven by the fact that last year was a tough year because of the pandemic part of it is you've had a lot of new issuances of companies newly becoming public that are not profitable, but it really does speak to the prevailing growth mentality in the marketplace, so we have a lot of stocks trading above 15 times revenues we have a lot of technology stocks that are not profitable and those elevated valuations are worrisome to us going forward. we've seen some correction of that this year, but we're still at very elevated levels on either of those metrics, unprofitable or extremely highly valued companies. >> so bottom line me here, toni,

by giving me some names that fall into the category of technology companies that i should feel -- that you follow that i should feel fairly good about either owning or adding to my positions to, and some technology companies that fall in that other category of maybe dangerously overpriced maybe not making money, maybe not being overvalued in terms of their revenue. give me some examples. >> sure. well, when we screen for companies that are not making money and are trading at more than 15 times revenues and are big, we come up with names like airbnb, snap, twilio, pinterest, palantir, doordash those are all names that didn't make money last year trading at 15 times revenues or sometimes 30 times revenues or more. those are stocks that you have

to have very high conviction in their ability to meet or beat earnings going forward because typically they have underperformed over longer periods of time. i think if you -- you know, there are a number of stocks that haven't done well this year many of the faang stocks all the faang stocks haven't done well this year. they're trading in many cases at reasonable valuations. and so i think our house view is, you know, names like facebook and google have been beaten down and those are names that bernstein are recommending. apple has been beaten down somewhat but it was up 75% last year so we don't think that stock in particular is uniquely attractive or particularly attractive at current valuation levels. >> toni, thanks for your insights as always it's great to see you. >> thanks for having me. >> frank. while concerns about tech valuations linger, first and second quarter gdp estimates on wall street are getting more and more bullish take a look, goldman sachs has a

5.5% forecast for the first quarter and an 11% estimate for the second quarter so where does the market go from here and where are the best opportunities beyond those faang stocks rachel akins from rockland trust, jeff mortimer at bny melon wealth management. jeff and rachel, thanks for being here it 10-year has fallen today. we see the nasdaq up a percent and a half in recent weeks investors have been running away from tech because of the speed at which they have risen. outside of faang, what stocks should we be looking at? >> so within the tech arena, again, we at rockland trust are sticking with high-quality companies. within tech we've been underweight as an organization and remain there, but we still think there's opportunity and it

has to be at the security level. specific opportunities for us outside of faang are names like microsoft, where again we have been a long-term holder but we think they have a very long runway with tech spending anticipated as a percentage of gdp to double in the next decade, there's been a little pull forward with the pandemic but microsoft offers two high growth areas between cloud as well as collaborative tools that are still going to be necessary, especially in the cloud arena. you're looking at cloud penetration only about 20% so that gives us room for acceleration for a good five years. when you look at valuations, microsoft is a great company in 2020 again, trading at 31 times does not seem excessive to us when you have the high quality business model they have as well as the amount of cash and the high cash conversion cycle they have which helps us mitigate those valuation concerns people are looking at in the tech area right now. >> jeff, you and rachel actually had the same s&p -- price target

on the s&p with the broader index finishing about 150 points higher than the levels that we're seeing today but at the same time we're seeing companies like goldman with very optimistic q2 forecasts for gdp as high as 11%. how do you see your thesis playing out, especially as we approach q2, when a lot of people see the economy recovering and rising but you're only seeing 150 more points on the s&p by the end of the year >> markets are discounting mechanisms many of those gains were already amend and may have been shown in 2020 the strong gains of 2020 were really in anticipation of a very strong gdp markets are very good at looking forward. so you have to think right now markets are discounting six, nine, 12 months from now programs higher interest rates, perhaps the companies which may have a little bit too much valuation in them currently which might struggle going forward. so it is always interesting to look at how the stock market and the economy are sometimes not in tune with each other but the

market anticipating like i said higher rates again, the second year of a bull market tends to be more modest gains and tends to be with a correction or significant rotation i think we're already starting to see that in an early 2021 we think that plays out really for the rest of the year. >> rachel, same question to you. a lot of optimistic gdp forecast but you only see the broader index gaining 150 points at year ending what happens in q2 that justifies your thesis? >> so, again, i agree with our earlier commentator there speaking about the second year of this market recovery does tend to be less robust when we're looking at where there could be upside earning surprise which could pull the market higher, it would be if we saw earningseven more optimistic than what we're thinking for q1 and q2 but again, when we're looking at where the markets can run, we see a lot more volatility, a lot

more rotation, but there's definitely move for room upward based on the fact there's still a lot of liquidity out there looking for a home. >> thank you both for being here and sharing your insight we appreciate it. >> thank you. frank, coming up, the race to vaccinate is on and astrazeneca could be the next company to have its shot thrown into the mix we will tell you what it could mean for the reopening timeline. plus tesla bouncing back as arc investments kathy wood lays out the case for the stock to head to $3,000 a share there you see it at $700 right now. we've got those details. more "power lunch" coming right up

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welcome back, everyone the race to vaccinate continues. more than 124 million covid-19 vaccine doses have been administered now in the u.s., and now new results show that astrazeneca's vaccine is 79% effective with no serious risks, despite some recent reports. meg terrell joins us now with the details. >> hey, tyler, these were the results from the big 30,000 person trial of the astrazeneca vaccine, what many in the country have been waiting for as it's already been cleared in many countries around the globe and the results came in better than expected. 79% efficacy in preventing symptomatic covid-19

100% against severe disease and hospitalization. they only saw five cases of severe disease on the placebo group but there have been more since the interim look and that's a strong result no vaccine safety concerns, including in particular blood clots which have been a concern in europe. they looked specifically for those and said they didn't find them now, they are going to file in the first half of april for emergency use authorization here in the u.s if it follows the same pattern as the previous three vaccines, it could be about three weeks until the green light if the fda gives it then they say they'll have 30 million doses immediately available, another 20 million to follow later in the same month and 15 to 20 million doses monthly going forward. tyler, as you were laying out, we've already administered 125 million or so doses already in the united states. 83 million americans have already had at least one dose. that's a quarter of the population you can see here the seven-day

average of how many doses are getting administered each day has been climbing. now we're at 2.3 million doses on average getting put in arms each day here in the u.s really encouragingly for folks over 65, sfepgt 70% of people have had one dose and 42.5% are fully vaccinated, ty. >> and i am one of the 42% though i have to tell you, meg, that after my second shot i did experience and am still to a degree experiencing fatigue. anyhow, let's get back to the real topic it's not about me, believe it or not. with three vaccines already on the market, what role was astrazeneca's play in the u.s. landscape? could we have too much supply? >> we likely will, tyler there's been discussion about blending some of the astrazeneca doses that we currently have to our neighbors in mexico and can today. but we'll have enough if all of the companies meet their supply

obligations with just the first three vaccines if you add astrazeneca in that's more than we can use at one time so dr. gottlieb was saying this morning we'll have enough that people can choose which one they get. it will be a different time in just a few months. >> is the astrazeneca a single shot or double shot? >> that's a really important question it is two doses given four weeks apart in this trial. so j&j is the only one-dose shot >> meg tirrell reporting. ev street. kathy wood getting more bullish on her tesla bet plus volkswagen announcing a crossover utility vehicle. those details ahead. stay with us

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get the food you love with perks from- - [crowd] grubhub. welcome back kathy wood making a dramatic call on tesla, now expecting tesla stock price to reach $3,000 by 2025 you see today it's at $690 the stock also up today, but still down more than 20% from

its record high. wood's new target price represents a leap of more than 330% and a $3 trillion market cap. that's right, 3 trillion arc expecting tesla to launch a ride-hailing network and then an autonomous robo taxi service adding $327 billion in revenue they are also modeling a new tesla insurance building tesla is arc's largest holding in a best case, she says, tesla could reach $4,000 in 2025 tyler. >> all right, that will get a lot of people's attention right there. speaking of electric vehicles, volkswagen making its first big move into the booming ev market with the rollout of its new id-4 phil lebeau has more >> tyler, this is an important launch for volkswagen for a couple of reasons. one, it has long struggled here in the united states and, two, it's targeting the biggest

segment in the industry, crossover utility vehicles they're coming out with the id-4 and pricing this with the base price just under $40,000 add in the federal tax credit and it brings it down to the $32,000, $33,000 range the range, 250 miles, which will be enough at least in the beginning and they expect that to be expanded over time as the battery technology improves. we had a chance to talk earlier today with the head of volkswagen usa i asked him, look, do you think the ev market is primed to take off here in the u.s. he said oh, yeah, take a look at the estimates out there. yeah, they only sold collectively the industry a little over 200,000. but by 2025 it's expected to be roughly a million vehicles, ev vehicles, being sold here in the u.s. and the head of volkswagen usa is optimistic that could only be the start. >> these massive shifts, phil, aren't going to go away. the government, the invest, the environment, plus the american

consumer i see it happening and i see it happening quicker every year >> take a look at shares of volkswagen the id-4, the initial ones coming in right now, they're coming in from germany, but this will be built in tennessee, in chattanooga, tennessee, starting next year. they're also going to build the battery pack down there. when we talked with scott keogh i asked him when does the chip shortage last and he expects it to go well past the summer so that's what we're seeing in the auto industry, a very sober outlook, especially when it comes to the chip shortage. >> we'll talk about that in just a minute for me the ev thing is this, price, styling and, third, range. they solve those three things, i'm in let's talk about that chip shortage impact on ford, phil. >> right well, they have announced that they are going to be shutting down production where they do commercial vehicles at their plant just outside of cleveland, that's this week

two-thirds production. so one of the three shifts will not be operating at the plant in kentucky that's where they do the navigator, the expedition, super duty pickup trucks this is what we've seen for a while, tyler, and we will continue to see this with all auto makers. they're going to have to adjust their production simply because they do not have all of the supply of chips that they originally thought they were going to have. >> all right, phil, thanks very much phil lebeau reporting. frank. still ahead, talks of a massive infrastructure plan on the way. corporate taxes likely to go up to pay for that bill, but which industries could benefit from some carve-outs? we'll try to tell you coming out. plus betting on betting. one analyst getting bullish on draftkings saying new york could be a $3 billion opportunity for sports betting all that and much more when "power lunch" returns. and 2 free smartphones. plus you'll now get netflix on us.

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and with fast, nationwide 5g included - at no extra cost? we've got you covered. so join the carrier rated #1 in customer satisfaction... ...and learn how much you can save at xfinitymobile.com/mysavings. welcome back i'm rahel solomon and here's your covid-19 update cdc director dr. rochelle walensky addressing concerns about an increase in spring break crowds. >> we're so close to vaccinating so many more people.

i would just encourage people and remind people now is not the time to travel. >> for those still waiting for their stimulus checks, a new batch is on the way this week. according to the treasury department and the irs, a second batch of the $1,400 checks are scheduled to hit bank accounts on wednesday this batch includes a large number of mailed paper checks and prepaid debit cards. and check out this aerial view of an erupting volcano near i saycapital at the foot, scientists using the lava to cook hot dogs as they study the eruption. i'm not sure you can see it but they also came prepared with ketchup. frank, i will send it back to you. >> thanks, rahel. tech powering the market higher the dow up just under half a percent. the s&p up a percent the nasdaq, however, leading all these gains, up 1.75%.

the russell, we often call it the recovery index, actually lagging, down about a half a percent. tyler, back over to you. frank, following the massive stimulus package and talks of a potential multi-trillion infrastructure plan, the chances of a tax hike do seem to be growing, but businesses across the board are already pushing for breaks ylan mui in washington has more. >> tyler, think of the infrastructure bill as just a big train barreling through capitol hill everybody wants to hitch a ride and bring on a little something of their own major manufacturers and tech companies are teaming up to fight for the expansion of a key tax credit the r & d coalition includes amazon, intel, ford and raytheon they're getting behind the bill called the american innovation and jobs act it doubles the r & d tax credit and allows companies to keep expensing all of their r & d costs each year. currently that benefit expires

in 2022. but it doesn't end with manufacturers. musicians say they need a tax break too. the chips act helping independent tracks succeed act allows artists to write off the cost of producing records in the united states, unto $150,000 a year >> they're not able to tour, they're not doing live shows there's so many people that are struggling it's been millions and millions of dollars that they have lost so for us this tax break, it's the ability to deduct just kind of starts to make a small dent in some of the money that these people have lost >> now, this bill does have bipartisan support so, guys, it could get by with a little help from their friends in washington back to you. >> what are the most contentious issues in this sort of horse trading that will go on here is it that expensing of equipment and other things

>> we don't know just yet, tyler. there are reports that president biden's administration is just starting to put together sort of what the contours of this bill will be. but what you're seeing is individual companies, individual lobbyists throwing the spaghetti against the wall and seeing what they can build support and momentum for in what type of package. does this go into an infrastructure package does this go into a larger spending bill? does this go into the china package that majority leader chuck schumer has talked about there are a number of different ways they could get in there once they get passed, it's very hard to get rid of them. >> all right, ylan, thank you very much. ylan mui frank. one company looking to capitalize on a possible infrastructure package is schneider electric the french-based firm was named 2021's most sustainable company by the corporate nights. they formed partnerships with walmart, even aramco as well as

an electric partnership with paccar joining me is the president and ceo of schneider electric in north america. thanks for being here. >> thank you, frank. >> we talk about infrastructure and a lot of people talk about roads and bridges. but i want to start with a $2 trillion proposal, what it is now that touches a lot of us, our homes. under that plan we'd see a plan to build 1.5 million sustainable homes and half a million charging stations. can you give us a sense of what that would mean for your business how would the chip shortage impact that? and would you manufacture some of that stuff at one of your 30 sites in the u.s.? >> yeah, thank you very much i think when we think about the biden/harris climate plan and the $1.9 trillion infrastructure, really there's a lot of ways that it really impacts our company. that build back better in a more

sustainable way really does help companies like you talked about, walmart, clorox, pepepsico. so in the walmart example that you mentioned, we're actually saving more than a million tons of co2 with them and their supply base. actually accelerating many of these companies' ability to hit their sustainability objectives, but that's not it. it goes on into military installations like the miramar air force base where we put in a 5 mega watt microgrid. you talked about residential, and obviously the same sort of energy efficiency in the homes and really accelerating the adoption of electric vehicles. not only for individuals, but for the fleets a customer like paccar where we're working with safe technologies to help them accelerate their electric vehicle infrastructure for both their factories and their

dealerships. >> traditional infrastructure is roads, bridges, the grid when we talk about sustainable or green infrastructure, there doesn't seem to be a real consensus from capitol hill to main street exactly what that mean what does that actually mean, and how does that impact the way we get our power >> we like to think p about that in buying more sustainable energy or microgrids one of the ways you might think about a microgrid is something that's decentralized it's closer to the point of use, requires less transmission it actually is less sensitive to the grid oumtages. it's potentially decarbonized, coming from solar or wind and it's digitized, meaning it can operate in an island mode or in conjunction with the grid. >> so hypothetically in texas if they had more of these microgrids, what difference could we have seen >> we actually know some of our customers in texas with microgrids that were able to sustain their operations they were able to continue to have power and more resilience

at a time when the grid was under a lot of pressure. in the texas grid example, every hour of outage is millions of dollars for data centers and many of our manufacturing customers. so this is really powerful we've had a number of examples where we have been able to stand up microgrid resiliency for our customers. miramar is a great example they have a 5 megawatt microgrid. when the local community was out of power, they were able to take that 5 megawatts and power many homes. >> you said what you do for yourselves and what you do for other companies. can you spell out what you would do for walmart or pepsico to make them more sustainable and what kind of demand are you getting for these products >> we have a sustainability ability division that helps customers define their road map for more sustainable operations. we do renewable energies like

the microgrids but in general we help customers make the most of their energy so we drive energy efficiency across their operations. we use the data being produced by all these smart devices now an aggregate it in areas that helps them across the portfolio. what that does is it allows us to put advisor services and many of our software applications on top of that so that the customers can actually do more with less energy not only in their factories and their buildings but in the data centers as well. >> annette, before we let you go, i have to ask. you have about 19,000 employees here in the united states of the will you mandate they get vaccinated or incentivize them to get vaccinated? >> being vaccinated is a personal choice and we won't mandate vaccines however, we do in our cedar rapids, iowa, facilities and west kingston facility, we have stood up vaccination sites in conjunction with the local community.

all of our employees have an essential letter basically saying they're part of an essential operation and can get in line for the vaccine now. in addition to that, we're giving our employees the opportunity to go get vaccinated so we're encouraging it. >> annette clayton, ceo and president of schneider electric north america. we appreciate you being here thank you. >> thank you, frank. let's get over to the bond market now where yields are retreating just a bit today. rick santelli has been tracking the action at the cme. hi, rick >> hi, tyler and indeed we are slipping a bit, but do keep in mind as you look at this chart that starts basically the last fed meeting you can see that the market leaped a bit even though we've slipped today as you look at a month to date and realize that 1.67 where we're trading is still up 26 basis points on the month. the issue is the long standing high yield closes around 1.53 and the high intraday spike was

1.61 those are below the market and represent good support so even as we slip down, we could slip down a bit further and you're still going to find many that are looking to sell against some of those levels if you look at the dollar index, it's slipping a bit too but open the chart up and something should jump out. we haven't been trading very far from an intraday basis from 90 to even. we almost touch it every session and that is key because that's the best resistance. look for more lateral trade on the greenback. tyler, back to you. >> all right, rick santelli, thanks planes, trains, major travel stocks on the move today those details in our power movers. plus, the fed says crypto is for speculation, not for payment. our traders will discuss that one when "por nc rurweluh"etns flexshares are carefully constructed.

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well, the dow is on a spritely little run there, up 164 points that's about a half percent. the s&p now clearing the 1%

hurdle the nasdaq composite still hanging in there where it has been most of the day the leader by far up 1.75% frank. >> all right, ty time now for today's power movers first up, canadian pacific buying kansas city southern for $25 billion. this is a cash and shares deal that will create the first rail network that connects the u.s., mexico and canada. the deal values kansas city southern at a 23% premium. canadian pacific actually down about 3% kansas city southern is surging right now, up more than 12%. turning from trains to planes jetblue getting hit, down more than 6% right now. the airline planning to raise $650 from the sale of convertible senior notes due in 2026 this comes as the tsa reports more than 1 million passengers flying on sunday. finally dollar general climbing more than 4% after a bullish call the firm sees a positive inflection in traffic coming up

maybe tied to the recovery remember, dollar general does not have a big online business and now upgrading it to how it performs now let's get over to seema mody for trading nation. >> we are watching bitcoin jerome powell making some notable comments on the cr cryptocurrency this morning. >> crypto assets are highly volatile and not really useful as a store of value and they're not backed by anything they're more of an asset for speculation. >> bitcoin reversing from its highs of the day on those remarks, now down about 8% from its all-time record made earlier this month eric and gina is the trading nation team today. it's not the first time the federal reserve has made some negative comments around bitcoin, but i'm curious where you think this takes bitcoin from here, and is the bigger risk the likelihood of a central bank backed digital currency >> well, there's a lot of issues

to unpack here bitcoin continues to be a digital tool in the sense that it is very speculative and i think the biggest challenge to bit coin really isn't necessarily the moves of the fed but the fact that bitcoin has been the marginal benefactor of a lot of money printing, a lot of fiscal stimulus, but demand locked up in the pandemic lockdown as we reopen, i think that's the biggest challenge to bitcoin going forward. as money moves away from speculative assets out of the riskier assets and quite frankly into goods and services spending, i think bitcoin is going to get hit. >> eric, you've been watching the 50-day moving average. what are some of the key levels to watch >> listen, we'll finding out through time about the long-term viability of this asset. but this is a highly volatile security in every conversation about

bitcoin here's something that can drop 20% just like that and still uphold all of its trend lines and support levels and leave the trend up disturbed take, for instance, the action last february, made a high of about 58,000 the next day it was down to 44,000 it had been volatile in consolidating since then if you're following the trend, the assumption is that you break to the upside and make that higher high, but you need to be able to stomach that volatility. it's there to stay with the upside reward comes a lot of volatile day-to-day and week-to-week action. >> thank you both for joining me today. we're breaking down bank of america's bold reopening call so we sure to check that out. tyler and frank, back to you. we're coming off a big weekend for college basketball my bracket just -- i mean there's nothing left of it

it was also a big weekend for sports betting so how are names like draftkings benefitting from a betting boom? we will discuss that after the break. plus we're watching this market rally pick up some steam. a little spriteliness in the cow. up 164, 165 points technology companies are the giant leaders today, and they're the big ones, intel, microsoft, apple among the winners. and now the latest from trading nation.cnbc.com and a word from our sponsor.

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all right, folks march madness is in full swing and there you see it i believe iowa went out this

afternoon, a number 2 seed, i believe to oregon. the gambling industry is expected to rake in more than 2019's record $8.5 billion in take with the number of people betting online up more than 200% the dramatic increase in online betting us thanks to 13 new legal sports betting markets our next guest is betting big on draftkings, naming that company a top pick it is up almost 20% over the past month joining us is daniel adam. daniel, welcome, good to have you with us. why draftkings i think one part of it is you are banking big on the possibility or the probability that new york will allow online betting. >> absolutely, tyler thanks for having me as well so next week is new york's budget deadline, and we expect, just based on the fact that all three budget proposals that are on the table right now, the governor's, the senate's and the

assembly's, all have some form of legalized sports betting. so we think it's a sure thing that it happens. the question is in what form will they legalize we think that the senate and assembly versions of the bill are the more likely scenarios to play out and those are much more favorable for operates like draftkings >> in how many states now can i use my phone to place a bet? >> so for draftkings, they're currently in 12 states it comprises roughly a third of the u.s. population. i think ultimately one would expect that it will be tremendously higher than that, so our market tam estimate is substantially higher than other analysts on the street most analysts have a tam number in the $20 billion to $25 billion range. our estimate is $40 billion with upside to that if you look at new jersey and

extrapolate the gaming revenue per capita in the state of new jersey which is the most mature market but growing astronomically, just based on that you get get to a $30 billion or $40 billion tam that's what's being underestimated so increasingly we'll see more states roll out. >> where does draftkings relative to its competition, competition that you follow, where does it fit? is it at the top of your list? is it in the middle? how is it positioned vis-a-vis the penn gamings, the fanduels, the mgms >> that's a great question in just about every market that draftkings are in, they're the top one or two player. it's been consistent pretty much since they launched initially in the first few states what we're seeing is that top segment of market share is being held by the top two or three players. then from there, everybody else is competing for scraps.

and that's why we like draftkings because consistently in every market that they launch in, they have been the number one and two player fanduel, which is oewned by uk traded company flutter is the other top one and two player penn on the other hand has a 38% stake in barstool is only in three markets right now, which to us is a bit concerning because they have market access rights that should theoretically put them in more markets than draftkings so 12 states now. >> and growing. >> and growing. >> a lot of those states have budget holes they'll need to fill daniel adam, thank you very much we'll see you again soon. >> thank you, tyler. >> thanks, ty. i'm going to give you a final check of thearts a mket the highs of the session that's coming up right after the break. stay with "power lunch."

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smart thermostat uses geofencing to simplify how homeowners manage comfort and costs. emerson. consider it solved. let's take you for a final lap around the markets here as we finish off "power lunch." stocks are at session highs as you see. the industrials up half a percent, s&p up an even 1% nasdaq composite up 1.75 it is the likes of apple, intel, microsoft, cisco, salesforce big tech, frank, is what has been leading the way today remember what toni said at the top of the show, beware of companies that don't make money. beware of tech stocks that are

selling at above 15 times their revenue. the history there is not good. >> yeah, ty. one other point toni made, he wasn't as concerned about that chip shortage. intel up 3.75% another stock we want to talk about is tesla, up big as we see those bond yields start to retreat from that 1.7 level that we saw last week. >> all right, frank, thanks very much let's toss it over to "closing bell." wilfred and sara, take it away. welcome to "the closing bell," everyone, i'm wilfred frost along with sara eisen. stocks are higher with the nasdaq leading today's gains, up around 1.7%. small caps remain in the red down half a percent. let's have a look at what's driving the action treasury yields falling back and that's giving a boost to tech names. tesla is getting an extra boost on the back of a bullish price target from kathy wood more on that in just a moment. there's mixed headlines on the