i think it's worth $28 and more. >> pool supplies there as the summer wraps up. bryn >> yeah, lit, if you want to play the is ev market. it focuses on the mining, refining and battery production around lithium >> weiss >> dks, dick's, attitude this morning. >> good stuff, everybody "the exchange" is now. >> thank you, scott. hi, everybody. i'm kelly evans. here's what's ahead on "the exchange." the market's brief recent losing streak has people wondering, do you stick with what's been happening or start to get defense sniff our guest has three names that he thinks will work into the year's end they just announced they'll be paying the first dividend in company history. with natural gas prices surging to a seven-year high, we'll speak to the company's ceo about whether this situation is sustainable or will it choke off

growth >> and academy sports is another big winner the stock down today after the ceo called it the best earnings in company history is this as good as it gets we'll have the man himself dom chu here with the markets. >> mixed mixed in a pretty decent and calm way because the markets right now are all generally within striking distance of record highs the dow industrials just about 2% away from those historic levels the s&p 500 about 0.75% below its record highs as of late. and the nasdaq just about 0.5% away mixed markets. relatively calm. trying to figure out what that next catalyst will be. one place, however, that is under performing markedly over the last several months has been the transportation sector. that particular industry overall started off the year with a bang you can see here going back to the beginning, tracking fairly close with the broader market and then it just really took off to the races that gap was pretty wide here

later on in the year in the summertime you can see there that line, the dow transportation etf, the orange one, has then drifted lower. about a market performer so something to watch for if you're looking for caution signs developing possibly with markets at record highs. one stock, though, that's continuing to become a massive move to the upside in terms of momentum, year to date gain 3634% for moderna. we know the covid vaccine is a big part of that story up again today because it's trying to see if they can put together a single dose vaccine that can go against covid-19 and the seasonal flu they'll see if that works. they'll test that as well. moderna shares up 7% on that news so watch those and, by the way, moderna, kelly, always one of the mostpop searched tickers o our website. so moderna certainly getting a big boost today in trading >> a lot of buzz about this possible combo vaccine dom, we appreciate it. it's already experienced a number of rotations this year.

my next guest says just focus on investing in best in breed companies with long runways for growth let's welcome in larry the portfolio manager. growth and income, do those things go hand in hand >> yeah, kelly i mean, thanks for having me back they do. and in fact, we do think that they are extremely complementary. if you build a portfolio that's balanced between the two concepts, you get, obviously, both capital appreciation and growing dividends over time. especially in a low rate environment like this, if you can compound dividend growth over a longer period of time, then that is a really powerful income formula for investors >> tell me you have amd, active, google remind me if any of these have dividends. >> these are more on the capital growth side, although active has traditionally paid a dividend with the, you know, the cyclical downturn or struggles in autos

in covid that got suspended we'd expect that to come back over the next year or two. but these are generally more on the capital appreciation side of our strategy >> and let's talk about atpiv. they are a leading supplier to electric vehicle manufacturers what are your projections for the market and for aptiv being able to tackle more market share. >> so currently about 4% of vehicles every year are produced are electric vehicles. the expectations are that that's going to quadruple over the next 3 to 5 years to about 16%. certainly if you look at the market demand out there and the commitment of general motors and ford and, of course, we all know tesla and volkswagen, i guess, is a very important one i'd throw in i guess it's a fair bet that 16% is a very reasonable expectation

for where ev growth or ev mix trends toward. the reason this is important for aptiv is because they make two to three times as much money on an electric vehicle as on a combustible engine vehicle so if you think about the compounding profitability of that content growth over time, that's really important. the street expects around $9 of earnings in 2025 i think that if we end up getting this mix of evs that we're talking about, it's going to be a bit higher than that >> because the other two, obviously, google and amd we talk about a little more often but all of these ev plays are becoming more and more prominent. tell me for a moment why you like amd and google. why now? why stick with these stocks? they've not been underperformers. >> no. there, amd, i'll start with that and the reason i think amd is interesting is because there's been a lot of focus around intel's missteps as it relates

to the amd story and i don't think there's enough attention on amd's competitive advantages this is more than just intel not being able to make chips the same way, the same quality that taiwan semiconductor can this is about amd's architectural advantages the ceo of amd a number of years ago positioned the company around what we think is one of the most important secular trends in data center computing, and that's concept called heterogeneity which is a lot of different chips working better together so if you look at amd's architecture which you probably heard the word chiplets before that chiplet architecture allows customers to integrate their own specific chips with amd's chips so that the whole process is more efficient, more powerful. it works better together basically. that's something that we don't see intel being able to replicate in the next couple of years. we think amd's success continues. >> i thought you said chipwich

but chiplet. >> that's right. >> heterogeneity applies to portfolios as well just in a word, why google, before we go >> it's underearning trading at 23 1/2 times free cash flow. and it's underearning. look at the cloud business alone, close to $20 of earnings power is that cloud business, as it scales and becomes more profitable and then we can go into the google bets and all that but at some point they'll either make money or get cut so if you look at just where the earnings power is for google, it's quite powerful for a stock that's already growing very quickly and trading at a very reasonable valuation >> larry, a pleasure really appreciate you walking through all of these names thank you for your time today. larry cordisco a news alert out of the bond market $24 billion worth of 30-year bonds up for auction at the top of the hour. big question marks about what investors are willing to end to the government for 30 years. how did it go?

>> you know, what? not only are they willing to lend touncle sam for a yield a the 30-year auction of 1.91, they would have bought more. if you would have stacked more on the buffet table, they would have come along and eaten everything $24 billion. the metrics are truly amazing. the bid to cover, strong indirects was the best since july of 2020 at 69.7 directs were the only thing a little light i would have given this auction an a-plus. that was a bit light at 17.2 but i gave it an "a" nonetheless. 13.1 on dealers. okay we've talked about this before whatever is left on the buffet table, the dealers get it all. but investors don't buy. the primary dealers. the dealers only took 13.1%. i have a 30-year database i couldn't find a lower number than 13.1% i think it's the all-time lowest amount of dealer takedown in a

30-year bond auction but this is an important, whether it's it was yesterday, solid "a." yesterday 10s, today's 30s investors think rates are not going to penetrate some of the recently tested resistance levels we've talked about them a lot. 1.37 to 1.39% on 10s unbelievable we're now under 1.30 on 10s. under 1.90 on 30s and the buying keeps coming in. >> there's the 10-year, 1.29% as you're speaking. we can see the dip there rick, thank you. rick santelli. the delta variant continues to delay the economy's return to normalcy new data looks at a key indicator affecting parents in the labor force. let's get to steve liesman with his back-to-school edition >> the back-to-school edition of the road back barometer, a fast growing number of school closings suggesting the delta variant is setting back hopes

for a complete and full reopening. the road back barometer. 100,000 schools out there, but look at the growth rate. 140% in just a week. the last week about 700 or so schools and the average school being closed 8.7 days. while the number is small, it's accelerating and widespread. school closing span 35 states. concentrations in texas, georgia and throughout the south the purple dots make september closings many are recent. some, of course, have since reopened schools are reacting to the delta variant, about 52% of those schools that closed went virtual. 40% closed for at least some time because they didn't know what to do 5% just delayed the start. it's unclear how many parents are affected by the closings more women have dropped out of the labor force than men since february 2020, which is unusual in a recession we know from surveys that child

care and schooling issues play a role in explaining why women haven't yet returned 1.6 million decline in the labor force for women since 2020 for an idea how fast this has come on. the fed's beige book yesterday mentioned covid and delta 54 times. in july we thought it was going away it was just 9. facebook said employers have not seen a rush of applicants they expected with school reopening that may help explain why. >> it's great data and microsoft today delaying its return to office indefinitely as all of these issues overlap and combine. steve liesman, thank you coming up -- a new dividend play on wall street. one of the biggest beneficiaries in the move of nat gas prices. whether they can stay at these elevated levels. plus, shares of macy's have nearly doubled putting it on pace for his best year ever. but the run isn't over why and how high can it go he'll join us ahead on "the exchange."

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cheniere energy has been getting a boost. it's up 50% year to date and announced its first ever quarterly dividend of 33 cents joining me is jack fusko, the chairman and president >> thanks for having me on today. >> why the dividend? >> you know, kelly, we announced in all of the above capital allocation plan. in the plan is the first thing was to strengthen our balance sheet. we are just finishing with a $30 billion construction effort and it's time for us to get our credit metrics under control secondly, what we want to do is fund our growth, which we have expansion plans at our corpus christi facility we've set some money aside for that and lastly, we were trying to give back to the shareholders. we're doing it two ways. one with the dividend and secondly with our share buyback program. so we've announced another billion-dollar share buyback program that we have effectively

launched >> and sort of guesting past a lot of cap ex. i different kind of sort of environment going forward. let me ask you, obviously, liquefied natural gas is one piece but we're talking about fuel that is 40% of the u.s. electricity grid, that is i think nearly half of what households use to heat, especially as we head into winter are nat gas prices going to stay this high, and why analysts say we have enough nat gas in this country that prices should be at $1, not $5. >> yeah, so we've seen it all over the last year with the pandemic, we saw natural gas prices around the world at $2. $2 here in the u.s., $2 in europe and $2 in asia. and then as the economies began to ramp back up as the countries and companies worldwide decided that nat gas was the fuel of choice for clean energy transition, the demand has just

skyrocketed. so we are completely sold out as a company of 90% of our production for the next 20 years. >> wow >> and, you know, we've delivered, so far, since 2016, when we started, 1700 tankers to 36 different countries and regions around the world so the demand for the product is incredible nat gas prices in asia today are $22. they are $20 in europe so, you know, it's been multiples of what the expansion or the price increase of what we see here in america. in america, though, we are flush with gas we've viewed this as more transitional we had 95 bcf of production in the united states pre-covid. that dropped to 88 bcf a day and now it's back to around 91 bcf a

day and with ida we lost 2 bcf, but we think it will come back >> for those who look at this market and go, this is going to be a disaster to some extent you have people warning this is going to choke off the global recovery and it's going to hit consumers. it's much worse than europe. much, much worse than europe right now. worse than asia. not quite as bad in the u.s. but the real question is, can prices stay up here? do you expect prices to stay this high? like you said, this is really a policy choice. if europe says we're going carbon neutral by 2050 and the price is soaring and the biggest ones going offline and huge demand from asia, this seems like a real supply crunch problem. what can be done to ameliorate it in the near term or are prices going to stay at these levels >> and that's part of the reason for our expansion plans. we have proposed to add another $7 billion project to our corpus christi facility to double our

capacity or production capacity at that facility because of all of the worldwide international uact utilities that want access to our lng. i don't think that prices this high, this volatile are good for anybody. i feel like a farmer because i'm always worried about the weather around the world and it just has to change. we need it to be a fair price, an affordable price, and a stable prigs so we can clean up the climate and help the world do a better job with getting off of solid fuels like coal and nuclear facilities >> it's interesting to hear you describe it from that point of view because the effort to get rid of fossil fuels does include natural gas. it's just obvious this is a key transition u.s. emissions are down 15% because of natural gas and fracking but that said, it's clear the policymakers want solar.

they want wind look at what the biden administration announced yesterday. what is the solution, in a way we are happily stuck with nat gas but they are still trying to move beyond it, right? what can your industry do to stay competitive basically >> yeah, it's not -- look. any of the scenarios that you see from iaea require natural gas. and the question is how quickly does the demand grow for nat gas in all the different scenarios so we see it as the fuel of choice and it's sustainable for clean energy path forward. we're looking at different technologies to sequester carbon and clean up our own act we've just published our first life cycle analysis. we're the only private company in the world that's done that. we're active in helping our suppliers do a better job. so today, kelly, we bought about six bcf of gas, which is 7% of

what was produced in america we transported it on 20 different pipelines. we bought it from 80 different producers. transported it on 20 different pipelines to our two facilities. and tonight we'll have two tankers head out to some part in the world, likely asia, which is where the highest price is but that's the demand for the product. we don't see it going away any time soon. at least not in my lifetime. >> it will be very, very interesting to see how people react to these prices, if they stay up here it's a whole new paradigm. jack, thanks for joining us to walk us through it >> kelly, thank you. say hi to brian for me >> brian sullivan, the intrepid sully all over this. jack fusco of cheniere energy. this stock is taking flight today after a big upgrade from jpmorgan what it is and why the analyst seeing it nearly doubling from here if the pandemic taught us anything, it's the importance of

mental health. we'll hear from venus williams arestog atest effort to brin awens that space. we're back in a moment this is wealth. ♪ ♪ this is worth. that takes wealth. but this is worth. and that - that's actually worth more than you think. don't open that. wealth is important, and we can help you build it. but it's what you do with it, that makes life worth living.

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connecting just about everyone to just about everyone else. ♪ it can open eyes with a cup of coffee and change minds on what makes a business, a business. and it is working to connect everyone, everywhere. so, meet visa. a network working for everyone. ♪ welcome back to "the exchange." a quick check on markets show that we're continuing our move to the down side while the dow had been up 168 points today down 123 sitting at session lows. this would make it a four-day losing streak. so starting to see this bearishness if you want to call it that set in still mild near all-time highs nasdaq also down 13. let's look at individual movers. boston beer, what a tough story down 4.5%. but down 46% year to date now.

they just pulled financial guidance saying they overestimated demand for the truly hard seltzer brand the stock at its lowest level since last june and dropped by nearly half since anuary on the flip side, shares of blade air mobility are surging after jpmorgan initiated the stock saying it could become the uber of the skies. $16 price target blade is around $10. and deutch is at $15 credit suisse around 14. read more about jpmorgan's call at cnbc.com/pro. tow to rahel solomon for a cnbc update this hour. >> here's what's happening at this hour. the justice department is expected to announce that it will sue texas over its new strict abortion law. attorney general merrick garland is holding a news conference to announce a civil rights case more than 100,000 microsoft employees will not be going back to the office early next month the company is indefinitely delaying their return citing the

uncertainty of covid some other large tech companies including amazon, google and facebook have already delayed their reopenings until next year and a new study says that the number of covid deaths and cases in nursing homes last year is far higher than what's been confirmed by the federal government the study suggests that more than 118,000 nursing home residents died of covid last year it's about 30% of the national total. researchers say the difference is because nurse, homes aren't actually required to report cases and deaths until may of last year. and on the news, president biden's new covid plan appears to be far more reaching than expected who will it affect and when? shep will have full coverage at 7:00 p.m >> rahel, thank you. tennis star naomi osaka was one of the first athletes to speak out about mental health and the toll professional sports can take then simone biles joined those ranks during the olympics when she sat out certain events and legend venus williams is teaming up with a therapy app,

better health. venus spoke with me recently about how the pandemic put a spotlight on the importance of mental wellness. >> i think we found out in the last year mental health is even more important than ever i'm very excited about this spotlight. and i'm very excited to partner with better health who is offering $2 million in free therapy and the wta who has committed to mental health since the beginning of my tennis career i think we're seeing the impact everyone has had i want to empower people with practical tools that can make a real difference. so right now you can go to better health.com/venus and start speaking with a licensed, accredited therapist i've had access to mental health care throughout my years -- 20-plus years on the tour and i've had that opportunity that's been provided by the wta to all the players. it's made a world of difference to me to be a human being who can achieve what i've achieved

in my life so i'm very excited to partner with better health and wta to give this to everyone. >> my understanding is you can get a free month right now it's up to $2 million. this effort to get this started. but i want to pick up on something you just said. there are a lot of critics who look at mental health efforts, the u.s. open providing special break rooms or the different accommodations made to younger athletes and they say what abou the venus es and serenas who gre up without this and still flourished why do you think these tools are so necessary >> i didn't actually grow up without those tools. i had the support from my family and also the support from the tour which really had access to dedicated mental health staff throughout my whole career that's a little known fact so that's been a beautiful experience not only for me but for the rest of the tour what's important is we want to destigmatize the process of

seeking professional help for mental health challenges so the beauty of this program is that no one has to figure it out on their own >> what else do you think young athletes need these days there's a lot of complaints about the media. do bigger changes need to be made to help with mental health? >> you know, i think there's so much pressure that you put on yourself as an athlete some of the toughest pressures you put on yourself, and a lot of that because of the outside world. where it's conscious or subconscious and it's important to realize that sometimes you lose and it's okay to lose sometimes you have pressure. sometimes you aren't going to be feeling your greatest or feeling your greatest mentally and being able to not only accept that but then get the help that you need for it. that's the most important part is realizing you're in this situation and getting the help you have because you cannot do it alone tennis is an individual sport. you see this one person with the trophy at the end but there's all these people behind them who

helped these athletes get there and that includes more and more increasingly these days mental health professionals, sports psychologists. this whole team is emerging now that is making a huge difference in sports. >> one final question, this being cnbc and you being pretty active in terms of your different investments these days how do you sort of figure out where you really want to throw your brand, your time, your energy what are some of the next up and coming spaces we should all be watching for your involvement? >> right i've just been more and more involved with all things health. this has been something i'm super excited to announce. i've been bubbling to talk about it because it's something that i use for psychology, journalling, meditation, all these things i've used on and off the court all things wellness. recently partnered with plant x which is a platform for all things wellness and all things, you know, health so i'm super excited about that. so it's really about

empowerment, wellness and honestly fun because i've been known to drink a bottle of champagne, too so i try to stay true to myself and that's when you really get the wins, right? >> i can think of some brands and apps and different things going on and all of those different parts of the economy venus, thanks for all your time today. we really appreciate speaking with you >> thank you so much childhood hero of mine and we're the same age shares of academy sports and outdoors are higher. they were lower after the quarterly report blowing sales out of the water we'll talk about what was said on the conference call that started to turn things around. we'll speak to theeo k cen hicks right after this on "the exchange."

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welcome back shares of academy sports and outdoors were lower today despite reporting quarterly results that handily beat estimates. they improved profit margmargin. and shares did turn higher this started during the earnings call after the company said it believes tight supply might push customers to buy early for the holidays and at full price the stock has more than doubled so far this year and has surged

more than 200% since making its public debut last october. joining me is chairman, president and ceo ken hicks. good to have you back. so first of all -- >> thank you >> how early are people going to be shopping for christmas and shopping for outdoor gear. i'm just curious about the social phenomena you're foreseeing here. >> well, people have continued buying things for fun and that's what we sell and i think we're going to see people out there a little earlier this holiday than even in the past because they've all heard about some of the supply chain challenges and we fortunately are in a good stock position but if you want something, you might want to get it a little earlier this year than in the past >> well, i will say while you're probably right and i will probably be late and miss my chance to get anything, is it self-serving because you know people will be more likely to pay full price or if they have more time to shop, might they actually be doing more price

comparisons than those of us who are down to the wire, have to just take what we can get? >> no, there are real challenges with what's going on in production and transportation overseas and in the united states and actually across the whole world. and so there are real shortages. the good news is, unlike last year where there were whole businesses that were completely out of stock of bicycles or exercise equipment, stock is available. it's just not in the quantities it has been in the past and we're trying to get as much of it in as we can. we're in a reasonable stock position now, but we think it's going to happen this holiday happens, it probably will be some shortages and outages on some of the most desired items so it's best to get them early >> i'd love to talk specifics. what are some of the most

desired items. is that now resolved >> still not the selection you'd like to have, but there are a lot of bicycles available. and there rit rally was a worldwide shortage of bicycles last year but now we got them. hot items. exercise equipment is very hot things regarding camping people are going outdoors and camping. we're seeing grills. people -- one of the areas where there probably will be some shortages, that's unexpected, in licensed apparel because some of the jerseys because last year, there were no sports this year, there are sports and people are going to them and people didn't produce as many as we might have been or might have in the past and so if you want to get your favorite player's jersey, you should do that earlier in the season than later.

>> that is absolutely fascinating. especially given the early signs of interest in sports this year. obviously we said it sold out for the nfl, $6.5 million and so forth. i guess for more of an investor point of view, the more important items there might be profit margins which are implicit in everything we've been discussing. the shared buyback why do a buyback is there a better use of that capital? i don't know how quickly or how much you're planning to grow at this point >> well, we plan to open stores next year, 8 to 10 stores next year and beyond that, we will continue to open it even more. we have -- we're only in 16 states we have an opportunity that very few retailers have in growing stores and growing our omni channel business, and in growing our basic business and so we're making investments there. we've got the capital. we're a profitable company, and we're generating a good amount of cash.

we felt it was time because we feel our stock is undervalued to take advantage of a buyback. but at the same time, we're making sure that we have more than enough capital to invest in all the opportunities we have for growth >> your company is absolutely in the sweet spot i hope everyone thinks twice about which jerseys they want to order this year. ken, great to have you thank you. >> great to be on. thanks for having me >> ken hicks, the chairman of academy sports you may think of macy's as a stalwart department store but one sees big innovation ahead. and u.p.s. seems to be taking a page from speed dating in this year's push for asalseon workers. we have those details next on "the exchange. ♪ ♪ and one we explore one that's been paved and one that's forever wild but freedom means you don't have to choose just one adventure ♪ ♪

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196,000. that's the number of american men and women who joined the military in the year after the terror attacks on 9/11 after heading overseas to fight, many of these soldiers came home in need of jobs as they transitioned from military to civil life drexel hamilton has been leading those efforts to wall street the investment bank is 100% veteran owned. and vets account for 60% of its workforce. its goal is to help give back to service members who fsacrificed so much. with us is the president and former army captain who served multiple tours in afghanistan and iraq john, thank you for your service. thank you for coming on today to talk about this. and where are we in the sort of effort to hire veterans? now that we're winding down trying to wind down the wars in afghanistan especially >> thanks, kelly great to be on your program again. and be with you today. it is true that the unemployment

rate when i left the service about 9, 10 years ago was exceeding 20% for military veterans it's averaging about 5% a month now. and where we stand right now is, especially for the financial industry what drexel hamilton does so well is help those transitioning military veterans find employment in the financial industry and that's a direct result of a lot of the initiatives that have been put in place to help keep that unemployment rate down. by the large banks and larger financial institutions and veteran initiatives. we've been able to partner with them in underwriting and training businesses. and build, because of them, a successful distribution platform to participate and that growth in those corporate treasures who are including us in their own way of their veteran inclusion for deal flow is only helping firms like ours grow in the space it provides additional employment opportunities for these transitioning military

veterans >> sure. forgive me for asking, but were you one of the people who signed up post-9/11 to serve? >> yes when i graduated west point in 2001, the towers were struck shortly after. i spent six combat deployments in afghanistan of my seven participated in the iraqi vision between a couple of those. i was serving the first ten years of this 20-year war that just ended it was extremely difficult my own situation to come home and find a job and i think that the strength of drexel hamilton is the fact that we're 100% military veteran owned. so we have been there in their boots before so the folks that are returning, we're able to get best practices, leverage our network or find employment opportunities with us. i have a great example of a young man who was hit in an ambush just last year. he was introduced to our network and a lot of the incredible

501c3s we partnered with outside of our business. i'm a board member of the lead the way fund that's how we got connected. he took a gunshot to the leg he was being rehabbed to get movement back into his foot. we were at his bedside and he took it upon himself we became his sponsor bank, put him in our internship program and he got fully licensed. a full investment banker now underwriting capabilities and it helping us cover corporate treasuries >> it's quite a story. what is the future for veterans as part of the workforce as our wars themselves wind down? >> yeah, and that stat you gave in the beginning is just an incredible stat that, less than 1% of our population is serving on active duty right now if you let that sink in, that's not as much of a representation of the u.s. population, but the united states military is so incredible these veterans that are

transitioning, even -- especially your junior military officers and your junior enlisted, like we're seeing. when they get out, they have been faced with such adversity, such difficult problems, whether in training or on the battlefield they've had to overcome and that type of curriculum is -- that experience that they have is not going to show up in a b school or an undergraduate program. but having these individuals and these folks in your ranks at your business is only going to make you a better firm >> john, thanks for your time today and for revisiting all of this with us we really appreciate it. >> appreciate it, kelly. >> john mart onko of drexel hamilton let's get a quick look at how it's changed in lower manhattan. there were 110 million square feet of office space and more than 400,000 workers but office space has really given way to residential buildings. now it clocks in at just over 89

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♪ ♪payday♪ welcome back, everybody. with christmas justa few month away, u.p.s. has announced seasonal hiring plans. they're really trying to pick up the pace frank holland joins me to explain the mavericky things they're doing this year. frank? u.p.s. announcing it will hire 100,000 seasonal workers to meet holiday demand. this is the third consecutive year it's looked for that many workers in particular with the majority of those jobs handling packages in facilities or helping drivers deliver.

75% of hires are expected to come from digital channels including mobile phones and social media 75% of hires came through. the other big change candidates can apply online and get an offer within 30 minutes. u.p.s. says this is partly cost cutting with wages rising, seeing their pay increase 5% year over year u.p.s. says it's also about getting the best workers possible in a very tight labor market >> the labor market is obviously tighter this year, but we think it's a combination we want to be out there and able to get the candidates processed quickly, but, also, it's about candidate experience we feel that people today want a faster experience. >> u.p.s. joins a long list of other companies looking for help rival fedex seeking 80,000 workers, a 14% increase year over year. walmart looking for 20,000 dollar tree, 35,000.

kelly, back over to you. >> and that doesn't even include amazon which could add more pressure to hiring sticking with the holidays, one retailer that could see a boost in macy's. upgrading macy's saying better inventory management and a transformation no a digital retailer are all reasons to be bullish. the stock is up 185% over the past year. this is their first outperformer since 2018 oliver chen, managing director at cowen so is it literally people going to macy's.com that's driving their digital strength >> that's a big part of it, kelly. it's great to be here with you digital is going to 40% of the business over time it's the number two apparel on site as well digital is a higher margin channel. overall macy's has gotten much more agile digitally focused and they're closing stores the store base will go to 500 over time. those are all very good aspects for the future and the long-term

prospects of macy's as well as margin profile >> but wait a minute, let me ask you about this they're the number two apparel website. i assume number one is amazon. macy's is number two for apparel? >> they really broadcast to a wide swath of america. it's an iconic place that americans loved and knew there's many more people who have joined the loyalty program as well. 5 million new customers. it's really up to macy's to engage these customers and that will be important going forward. kelly, the other part of the story is valuation so on a p/e basis macy's is trading around six times that compares to 11 times on nordstrom and nine times at kohl's that's a key factor. a billion in free cash flow. $2 billion of real estate value. this protects your down side as the stock is not very expensive as well. >> it is amazing to see a single digit p/e, oliver. i want to go back to the website. i have ordered off of it but what is their competitive

advantage over amazon? yes, they are number two in apparel, like you've said, but aren't they still up against a behemoth >> that's true it's very competitive. macy's stands for fashion and also is broadening their assortment to be more relative to the consumer. what does that mean? it means home, active, beauty, gifting. also, kelly, the future of retail is clicks having 500 stores can really be a competitive advantage as you utilize buy online and ship from store and other things americans love immediate gratification. so stores can play a huge role here top relationships with top brands is extremely important and standing for fashion there's a very good denim cycle going on and a product cycle, too, that's important and gift giving. gift giving will be important this holiday season as well. >> that's a great point. i don't know if it's a good or bad sign that i get my fashion

tips from analysts now i'm thinking i have to check out the denim offerings at macy's to find out what i'm missing. here is, i guess, the other question about profit margins that often comes up. how much are they growing share and at the expense of profit margins, how promotional do you expect them to be over time? >> unemployment is very low and we're experiencing inflation because the consumer is very strong so we expect the operating margins to go up over time as macy's experiences fixed cost leverage on a top line growth. what will happen is the digital business should grow double digits digital margins are actually five percentage points higher than in store. that helps as well so the future looks brit full-prized selling as well as pricing, those trends have been working in macy's favor. so if this momentum can continue, prospects are good for margin to expand we have the model that is 6% to 7% over time

so we'll monitor that. and inventory management is a key part of the story, too they're actually doing more with less inventory, just buying the right inventory and putting it in the right places are all key positives. >> and they have a lot to navigate with the holidays sounds like a nightmare for the availability of certain products and for stores trying to manage that a quick final question about amazon which is looking to actually offer its own department stores which validates what you're saying about the need for bricks and clicks, but is amazon -- would macy's ever be a possible takeover target for the likes of amazon >> i think anything is possible in this environment. as we look at retail more broadly, retail as an ecosystem plays like walmart and health care and financial services, pharmacy, food, home retail is really transforming and it's really important to also drive scale, loyalty, data, and the future, in our opinion, involves physical plus digital these are attractive assets and

it's important for each of these competitors to really hold on to customers, use data strategically and drive magic plus logic meaning infrastructure and supply chain. >> magic plus logic. i love it. oliver, thank you very much. again, he's taking macy's to a $27 price target and an outperform rating. that does it for "the exchange." stay right there because "power lunch" begins right now. yes, indeed. please do not move, not an inch. welcome to "power lunch. i'm tyler mathison and here is what's ahead this hour the safety trade is growing, a returning list of companies cutting guidance, warning of higher costs and supply chain squeezes is it time to shift to defense with your portfolio? plus, the esg extreme makeover more funds are going green or are they just rebranding older struggling ones in order to capitalize on the