more efficient and also is going to lead the way on the other side of housing. >> it has been awesome spending this hour with you. we did it midyear. now we are about o close out 2024. greet to get a checkup on tech. see you again soon. >> we have a nice market move. dow up 530. we will track it. "the exchange" is our. zillow, i didn't see that final pick coming. and welcome to the exchange. here is what's ahead. nvidia delivered nicely with revenue nearly doubling. shares down 1.2%. questions about whether the guide was enough. and there is a broader debate going on about whether or not a.i. scaling is kind of hitting a wall. our analyst says the stock definitely won't. he does see more upside for nvidia and he is here to make his case. and tech leading the charge in the deal making renaissance and one of our guests sees that

continuing into next year. plus, two other sectors he expects a lot of activity. and the latest to spin on, from private equity. we game out the possible scenarios for our new parent company and talk about what would create the most shareholder value and what it's telling us about the changes taking place in the media world. and on that, dom, let's see what's going on with the markets. a big day for the dow? >> it is because that broadening out trade, comcast, our parent company for now is just part of that story. it's not been about just the megacap kind of magnificent 7 type names. the north of 1% gain, 1.25% for the dow industrials up 535 points. 43,941. this is that kind of broadening out, less technology focused trade. you can see the nasdaq composite at 18,968 is pretty much flat on the session versus its the 1.25% for the dow.

the broader s&p 59349 up 32 points, one half of 1% begin there. the highs of the session we were up 36 points. that puts you in its high level range where we are. we were down 30 points at one point in the s&p 500. it's been a wide range today so star. are we are seeing a nice lift up so far. one of the things that's not participating that lag in the overall tech sector megacap, alphabet, the parent company of google after the justice department is pushing for this company to divest of its chrome browser, satisfy antitrust concerns. that headline leading to a 5.5% loss in alphabet shares. but it's not all bad in technology. data analytics, cloud compute egging and snowflake the best day since going public in 2020, up 33%. implication that they could grow 29% in terms of revenue for next

fiscal year if their forecasts come to fruition. snowflake huge upside. and then bitcoin has to be one of the bigger stories today so far. another record high. the star up there right now, 98,013. up almost 4% at this stage. the highest levels ever. the high-water mark if you want to call it that depending what exchange you are looking at, call it $98,367 depending which exchange. near the highs of the session. pushing closer to that 100,000 mark for bitcoin. we will see if that momentum keeps going p book to you. >> glad you are showing that. there are reports about gensler's possibly stepping down in january. we will monetary it and see if we hit six digits. nvidia is lower today despite another solid quarter with revenue nearly doubling year over year. the guidance was ahead of estimates but the bar was very high and could be a sticking

point for investors. are we going to kwibl about a 1% decline? the stocks tripled this year. my next guest has a buy rating on the stock. he acknowledges supply constraints he expects them to be short lived. he has a 17 # price target on the stock. why do you think there is some selling off here and is it even significant given that last time around i think the shares were down 6, 7% on results and they still rallied sharply into this quarter. >> yeah, we don't think it's all that significant. first of all, the demand is very strong right now. one indication, one positive surprise in the quarter if you look at the hopper demand, current product they are shipping in q3 and q4, that grew 5 billion sequentially. that's the fastest in the last four quarters. in the last four quarters upper growth averaged 3.5 billion and

in 3q it was 5 billion. usually what happens when there is a new product coming out there is a concern about a slowdown in the older products, but they are not seeing that. that tells me that the underlying demand is very strong. as you said, supply is the main issue for the outlook. that's something we were expecting. so we think that the demand going to continue, outpace supply almost all of next year. so if anything, you know, as long as the cycle extends we are viewing it as more of a positive. we are not worried about small -- >> could we back out for a second? maybe you could use what your direct experience throughout your career as a kind. witness point. it's so unusual for a semiconductor company to be worth $3.5 trillion. and are we -- the valuation is not that rich. they continue to kind of match where they need to be with the market. so it all seems real. but is this sustainable as a part of the u.s. economy,

sustainable in terms of the semi cycle? i would love your thoughts on the significance of all this. >> when you look at the market gap in a vacuum it looks a little scare. >> reporter:. at the same time you look at the company's profitability and valuation. it doesn't look that bad. historically this stock traded about 40 tombs an average. right now it's in the low 30s. the question is how long this a.i.-related spending will continue. just listening to their customers, doesn't look like -- you know, we need to worry about a slowdown, at least for the next, you know, 12 months. of course there is going to be a pause at some point. we don't have visibility as to when the pause is going to be. the other question is what's the roi like on a.i., why are we spending all this. >> exactly. >> so i think the better way to look at it right now the competition is so intense among hyperscalers. that's driving it. it's not so much about roi.

i think the reason is that in tech there is always one winner, right. if you look at any of the previous tech evolutions, there is always one winner. so the competition is going to remain intense before we know who the winners are going to be. that's not going to slow down. i think it's too early to think about roi from that standpoint. >> basically because google is battling, amazon is bat lin, meta, they are fighting to be number one, it's benefiting nvidia. that definitely makes sense. a little bit more color. there is a debate roiling silicon valley about whether a.i. advancement hit a wall. deirdre bosa has been talking to a.i. leaders about this. dovetails nicely into this conversation. >> this is all it feels like anyone is talking about right now in tech. this this debate over scaling laws and a data wall continues to just rage in silicon valley. this is the idea that more data and bigger models will always lead to better a.i. with some arg talking that progress has peaked or starting to plateau.

put another way, it's a debate over a core assumption in a.i. that could have massive implications for the industry from valuations to the gpuss powering it and the nvidia story. i was at a conference yesterday in san francisco. the theme of the day, every one from scale a.i.'s alexander waning to anthropic to data brooks weighing in. when jensen huang ways it in on the earning calls last night, you sit up and listen. he pushed back against the idea entirely. >> foundation model pre-training scaling is intact, and it's continuing. as you know, this is an empirical law, not a fundamental physical law. the evidence is that it continues to scale. >> now, those comments put him in a camp with sam altman, dario amodei and those pushing back on the data wall. he acknowledged this isn't enough to push a.i. further.

progress comes from post-training scaling. which is the development of a.i. applications on top of existing models, which he and others say will still require massive amounts of compute power. an open question. had it be as much? a helpful way to frame that feks of gen a.i. development is digestion or innovation. digestion may suggest a pull back on the huge amounts of spending, cap equities the last few years. innovation a kulk down, just another phase of development begins. still very much an open question. >> stay with us. i want to hear what you would say about this. and also i heard this that, i don't know, you tell me if the language is, a.i. the advancement rate is slowing down. this goes back to the roi and how are you thinking through it? >> yeah, there are two ways to think about. one is the comment i made about the competition.

even if things are slowing down on the margin, having that advantage, even if it's a limited advantage over rivals, makes a difference in tech. so i think that competitive intensity will continue and the spending i am not expecting to slow because of the slight slowdown in scaling. that's ones a pegt of it. the other aspect is if you look at where the upside in the quarter came from, it's mostly on the hopper product, which is the management was saying that that's more related to the inferencing, deploying the models. so that market is still relatively small in my view. so that's going to -- right now the focus is on training with blackwell and meta said that their next model requires ten times the compute, you know, for training. but we haven't really seen much demand as of yet. that is yet to come. nvidia, assuming there is a pause, right now i think the -- is looking for $5 earnings power for 2025.

and longer term could it be 6, $7. whatever that is, the multiple doesn't look that rich for the stock to pull back that hard in my view. that's something to be monitored. at the same time given our visibility for the next 12 months we feel pretty good about the stock. >> deidre? >> you said that we are still early in the post-training or inference stage. how do we know or do we know if this will require the same amount of gpus, compute power, infrastructure that has been needed which just massive in that pretraining phase? >> yeah, it's early days. the applications are still einvolvement. a difference in the user base, if you think about search for example, if you start using a.i. for search, that's going to be massive. so just looking at the spending and the interest level from all of the tech companies kind of tells me that this could be a big market. another challenge is with a.i. has been we have been underestimating demand last

several years. i think it's safe to assume whatever we are modeling is probably going to be turn out to be conservative. >> i love it. thank you for joining us today. as we move along to a news alert out of the s.e.c. eamon javers, is it official? >> that's right. the s.e.c. is saying that chairman gary gensler will be stepping down effective at noon on january 20th. that's when donald trump takes the oath of office. so is the biden appointee will be stepping down. his chair is -- he ran through 2026. clearly it has been signaled intensely by the trump team they intend to replace him at the s.e.c. he doesn't intind to stick around. this gives the trump team another big economic slot to fill. we are waiting on treasury, waiting for national economic council and now we will see what they do with the s.e.c. the expectation among folks in washington is that if they do

pick an s.e.c. chair, no matter who the name is, you are likely to see sort of intense enforcement around sort of more exotic cases, certainly around esg situations, less intense enforcement perhaps an entirely new look at what crypto enforcement might look like under a trump administration. we will wait to see the name there. the question is politically how does withdrawal of matt gaetz as donald trump's appointee or selection for attorney general slot, how does that affect how trump would consider the securities and exchange commission slot. will he pull back from, say, some of the more exotic names and go for somebody a little bit more establishment given that you might see some resistance up on capitol hill to some people who are entirely untested or will he go full crypto and try to find somebody with a crypto mindset to take that slot. we don't know the answer to that. what we know now, kelly, is that

gary gensler will be stepping down noon january 20. >> traders pointing out the market took a little bit of a move high early. could have been the gaetz headline. maybe they prefer establishment headlines. but nevertheless, something to take notice of. thanks very much. appreciate it. eamon javers. and now to another story dominating headlines. the spinoff of some of comcast cable assets, included this one. and ms cnbc and the golf channel into a separate publicly traded company, called spin co, and has investors wonder what is next for the new company and broader media world. my guest says it could be accretive for comcast growth and of course the core company could do better. jessica, senior media and entertainment analyst at p of a securities and mark douglas. mark, starting with you as the advertising guru. i could blame you for everything

that's going on. is this because the dollar -- we know what's going on with the decline in cable households, ad dollars shifting to streaming. where to you see this the next five years? >> pricing on advertising streaming is higher. the deal itself feels like it was constructed by the finance team at comcast rather than the business team. but that being said, mark lazarus who is going to run spin co, amazing. and i think if he is involved and run it, the strategic plans there, everyone doesn't get -- >> i think you are right. and while we might look at assets like paramount and warner bros. discovery, too much debt to be involved, you know, in partnership with the new spin co maybe the industry is going to see change in the next year or two. >> i think why i say that, can say it personally, when my company mountain started working

with nbcuniversal, mark was the first to see the growth opportunities in the small mid-sized business. so i think he sees that the cable businesses that there is opportunity there. and instead of something to leave behind, it's something to isolate and create more value from. but definitely i have to say seems more like how do you value revenue driven as something to do than, like, it -- and you have content and the consumer. they don't care how the signal gets to their home. >> totally. >> so nothing really changed to them. >> what do you make of the timing of this? >> well, i think the only surprise was that it was comcast as the first one to announce this as opposed to warner bros. discovery or one of the other traditional media companies. in our view it seems clear there will be a roll-up of cable networks. mostly for cost reasons.

so comcast is first out of the gate. low leverage, so a great balance sheet and they talked about growing and alluded to acquisitions, returning capital. our view is this will be a roll up vehicle for other cable networks and what will happen as a result is you will see corporate overhead disappear if they are rolled up or divisional overhead, advertising sales as well as affiliate sales consol dated, and eventually maybe down the road private equity could come in. but it frees the rest of comcast to do other things, whether it's, you know, making, you know, possibly a new administration, maybe there is the potential for getting bigger in cable, nbcu potential for bigger in ip or other areas. we believe over the coming year or so there will be a lot going on in m&a. >> yeah, it does seem like the opening move. i can't wait for this book to be written.

whatever is coming is going to be fascinating. what do you make of keeping nbc with comcast, keeping bravo. if you are worried about either the optics of some of the channels under a trump administration or maybe just the realty of keeping content along with the distribution, why keep a few of them in house? >> well, the assets that they are keeping, nbc network and peacock, are really important assets. so viewers are going, obviously, from linear to streaming and the nbc network and peacock will have really critical sports. they will have the nfl. they will have nba. they have the olympics. and that all stays at nbc u. so that's important. they also said, not this week, but when they released earnings, that they are open to merging their streaming platform. that's another area we expect to see consolidation. you know, to compete with netflix or even the disney

bundle, the other entities really need to be bigger. and peacock has 36 million domestic subs and it's not global versus, let's say, you know, netflix close to 300 million. disney is almost 200 million with a bundle combined. so they really need scale. i think you will see this is why we do think that we will see m&a in the coming year or so, particularly with this republican sweep. >> allowing combinations that might not have been allowed in the past. mark, we have, you know, the big -- we have the platform of netflix, let's go in order, netflix, amazon prime, maybe dimtz. disney said it's not spinning out the tv networks. >> that's the point, is that , you know, the entertainment consumer and the people producing the content, the wail the content is delivered i don't think is significant from a business perspective. might be significant from a valuation perspective. and i think the other networks are just not -- you know, comcast is more of a holding

company and so it buys assets strategically. it's tuned into what they are worth, what the future value is. i think abc -- and disney and netflix are a loyal more strategy focused and halil less financially motivated in the near term. each person, each company can do what they think is best for them. ultimately the consumer will be happy because they will still get the content. >> last question. why do you think disney, same question, is keeping the tv networks or are they ultimately going to put some of them out? >> well, their cable network group is smaller. if you take out -- espn is transitioning to streaming and disney, you know, channel also is basically stream. so what's left, you know, it's not that big. and, you know, so -- and there is tremendous growth. they have to transition to these businesses. the content is housed within one area, but, you know, the

advertising is moving to streaming. the eyeballs are there. and we see tremendous growth, like just take netflix, for example, with, you know, moving to live events. well, will drive globally just unbelievable momentum in advertising in the coming years. >> quick -- i keep saying quick last question. promise this is the last question. the performance of fox up 50% this year. what dhauz tell you? >> i mean, it's all about live. live news, live sports, and they haven't transitioned to streaming. they have a plan b if they have to, they will go hybrid. they have to be -- which is showing incredible growth in the past year in part because of programmatic advertising. and we have seen tremendous growth. netflix and actually spotify recently signed on with trade desk as well. so you are seeing this transition and fox is clearly a beneficiary of all of these things because live is just, you know, you don't see that on a

delayed basis. >> quick last comment? >> the comments on netflix, netflix is the onboard ramp to watch content at night. they have the ability to turn anything into bigger than the previous -- as a pay-per-view event, the tyson fight event wasn't going to do well. bird box a few years ago, the event of the holidays was watching it and that was a tiny movie. they can do this consistent. it creates tremendous value. >> music to your ears. netflix is $1,000. i remember you telling everyone to buy it. >> yeah, i think that's a conservative price target. it has a lot more room to grow. >> thank you both. >> totally agree. >> yeah. >> she is like, i have to put a thousand? go ahead. >> no, only because look at coming events. they have two nfl games on christmas day and beyonce is doing the halftime. and this is the time zone is so

much friendlier for international markets. it's woun or 1:30 and 4:00 in the afternoon. the tyson thing was late at night o if you look at -- you know, the live plus a day, the viewing was like 125 million globally. so the nfl on christmas day will be a big event. and on a global basis. >> all right. is it going to be bitcoin 100k, netflix 1,000? jessica, reef, thank you. coming up, automakers at the l.a. auto show looking to walk the line between selling an electric future and meeting the growing demand for hybrids. after the break, a first interview with hyundai's incoming ceo jose munoz, set to become the first foreign executive to lead the automaker. and health care is the worst performing sector since the election, down 3% the last couple of weeks. our guest says a sell-off is overdone especially in one subgroup of stock markets. where those opportunities might

be coming up. > iss hexcng o >>th i"t ehae"n cnbc. you founded your kayak company because you love the ocean. not spreadsheets... you need to hire. i need indeed. indeed you do. our matching platform lets you spend less time searching and more time connecting with candidates. visit indeed.com/hire

let's go boys. the way that i approach co work, post fatherhood,s. has really been trying to understand the generation that we're building devices for. here in the comcast family, we're building an integrated in-home wifi solution for millions of families, like my own. connectivity is a big part of my boys' lives. it brings people together in meaningful ways. ♪ ♪ welcome back to the exchange. while tesla remains the markets leader in u.s. evs, hyundai, kia, the second most sold this year ahead of ford and gm and

today it's introducing the largest one to date. joining us in a first on cnbc interview hyundai's incoming ceo jose munoz and phil lebeau. go ahead, phil. >> thank you very much. jose, we have the iconic 9 behind us which you just unveiled. give us some perspective when how look at introducing this atta time when there is so much going on. can this sell as well as you expected in the ev tax credits on a federal level go away or are reduced? >> it's a great question. let me tell you when our company decided to make a big investment in america we did it during the previous trump administration. and actually the announcement of the location, the capacity, the total amount of investment was made before. so we didn't build the plans and products that we are producing the plan because of any tax or i.r.a.

so, therefore, we still believe that the electrification is the right way to go, is the long technology that we think is going to be established. but also we see that on the way that maybe a little bit longer than we thought, we may need to develop other technologies. this is why in about a year ago we decided to announce that we would produce in that plant not only evs, but also hybrids, and even erevs. >> you will start building early next year at your new plant in georgia. if the sales are lackluster because of questions about ev incentives, et cetera, will you pivot to the production towards hybrids? >> definitely we can. so one of the key trends for our company is the flexibility. as mentioned earlier, not only planning to produce ionic 5, last month, but also the ionic 9 that we will start producing in

q1 next year and selling in q2. also we are building another line which is going to be hybrids. so flexibility is one of the big things we are doing. if you look at what we did in the other plant in alabama, that's the same story. so we were producing only is. we introduced hybrids for tucson, santa fe. then we introduce genesis including evs, the evs 70 and evs -- so we do the same in savannah. >> does it or worry you elon musk, ceo of of a competitor, is as close and as influential as he appears to be with the incoming president? >> well, we have to live with all type of situations in the industry, right. and i think the fact that elon musk is so close to trump probably is good for electric vehicles, not bad. as mentioned, we are not planning our business based on incentives. we want to produce great vehicles with great features with, you know, all the great technologies.

so ionic 9, so we have just announced this morning has the more -- the biggest space than any other ev in that category. we bring to all type of configurations more than 300 miles of range. it's the first time for us, so 17,000 it charges, tesla charges, that you can utilize when you buy this car. last 30,000 charges. so we bring acceleration, 0 to 60. all the goodies is what we believe the customers are going to appreciate. >> what would you say to incoming president trump, president-elect trump, if he called you up and said, should we increase tariffs on chinese-made vehicles and chinese buyers? >> that's a different call. thankfully, i am not the president of the united states. >> but he values the importance of ceos. if he called you? >> i think we say we need to

protect the industry in america. the automotive industry is one of the most important. south korea, the united states, strong believe in america. we are investing big time in america. we bring in 190,000 jobs to america only this project brings to georgia 40,000. we are talking about $12.6 billion of investments. so definitely we believe in america and we would like this market to be us, you know, protected as possibly in the new administration and beyond. >> real quick. what could you see overall for the market now with sales? it seems like we are at a plateau here. >> well, the market continues to grow relatively step by step. so we've seen this year is going to end with probably a 2% growth. we are selling about 5 to 6% above the market in north america. we are going to achieve more than 1.1 million sales. we are expecting 2025 to continue to grow in a moderate

fashion, maybe a 2%. the interest rates reduction is one of the key drivers. so we are relatively, i would say, bullish in a sensitive way, and then again we are all in with our investment and looking forward to realize this investment in ionic 9. >> jose munoz taking over the kit and caboodle starting january 1. appreciate you joining us. kelly, back to you. >> those kias are beautiful. you know, they are beautiful vehicles and it's fun to watch the evolution of these brands over the years. hyundai included. jose, thanks so much. congratulations on your new role. phil, thanks for bringing that to us. phil lebeau. coming up, should we expect a wave of dealing making next year as the new trump administration takes power? we heard about media already. let's look at other sectors that could see a surge and what it means for investors. we will dive into that ahead. businesses are wondering "what should we do with it?" i'm thinking company wide power nap. [ employees snoring ]

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counts including second-degree murder. the d.a. says it's the first time in state history a parent of a school shooting suspect has been charged. the supreme court rejected on wednesday an attempt to protect doctors who were being investigated in washington state for allegedly spreading misinformation about the covid-19 virus. the case was brought by the anti-vaccine group founded by robert f. kennedy jr. a group claimed any investigations to sanctioned doctors would violate free speech rights is. and shelves are still empty after the grocery store's parent company says the u.s. operations were hit with a cybersecurity issue that caused shortages. according to an nbc news analysis, at least 27 tores in that chain were having issues. kelly, back to you. coming up, say good bye to bifurcation. our guest sees a trifurcation

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welcome back to the exchange. markets are sherricking off concerns about nvidia's results with the dow and the s&p moving higher today. the dow is the out performer up 1%. the nasdaq is under some pressure from the sell-off in big cap tech, up a 0.10%. 443 is the ten-year yield. our next guests are finding opportunities as yields climb. a senior investment director at american century investments. and michael cushman, senior fixed income portfolio manager at morgan stanley. you have the kansas city view of things. maybe a little bit more out of consensus. for instance, health care, a sector that everybody hates now. you say even there could be some opportunities? >> yeah, i think right now there is a little bit of a vacuum in the market. everyone is looking at rfk's nomination and what that means for health care. that's bad and let's send all of health care down. but i think there are great

opportunities on that weakness especially in medical devices. people need their hips and knees -- >> it's the area you think gop makes it easier to get procedures. we had a big segment with zimmer and arnold schwarzenegger. i understand the case for it. you think? is an opportunity? >> absolutely. valuations are really attractive. really bad news is priced in for medical devices and even for biotech and biopharma in small caps. they have gone down as a group. if you are a company and you have a drug that's effective in meeting an unmet need, you are going to be able to make a profit and problem by get acquired by big pharma. there are opportunities when groups trade as a whole based on news headlines fears uncertainty when we really don't have a sense of what could happen. >> i mentioned you both see areas of opportunities with rising yields. where are those? >> as long as the yield curve is steepening, that's the most important thing as opposed to the actual absolute rate of

yields. but as the yield curve steep ens that's good for regional bank. margin expansion for the first time in a long time. we think you could see some loan growth coming off of some pent-up demand pre-election and excitement about the red wave and deregulation. that's an area that has been totally over looked by the market over the last several years. so i think you have bad scenario priced in and if the yield curve tons to steepen, that's a great environment. the difference of what you said earlier, we have seen a run up on the headlines the last couple of weeks. you say there is a lot of runway? >> yeah. most institutional investors are underweight and then the final potential positive catalyst is m&a. there is still i think three or 4,000 banks in the u.s. i think over the next several years that could come down to the mid hundreds. with the new more business friendly administration, easier to get m&a deals done. i think that could be a third catalyst for the group.

>> that brings us to a couple of areas, like credit. deal making has been constraining supply to some extent. to back up, where do you is see opportunity amid higher rates and do you think rates are going higher? >> the economy is doing so well. defying expectations for years now for everyone. consensus if forecasts slower growth it's held up if not accelerating. now casting models for the fourth quarter over 2, 2.5%% next year. the ramp up is good. credit spreads are on the narrow side by historical standards. this is the challenge. the absolute all in yield is still pretty high by historical standards. this is why i think the macroeconomic is positive for corporate performance, but if a more friendly m&a environment also raises risk for creditors. it comes from recession risk and leverage risk. >> if there is more deal making -- so kind of the

acquirer, maybe the deals don't work out, the deals involve lot of debt. the people in the credit market says maybe in a positive way brings more supply to the market. i guess you take that as a good development if we -- if spreads widen for that reason? >> absolutely. buyers on dips, the best performing of the high yield market is triple cs. it's the most economically sensitive and the economy keeps defying gravity. there is no reason not to continue to perform well in the current environment and that performed exceptionally well. we expect that to continue, including loans, floating rate loans. picking the point of the curve with the highest yields which is the very, very front end gives you 8 to 9% yields. >> you are kind of flip side. the story that wiped out a lot of small cap earnings, which side of the equation do you want to be on. >> companies managed quite well.

impact heyer interest rates on their balance sheets and net interest expense the last several years. now with rates starting to come down and they are coming down, they are in a good position. some companies may aggressively use it to leverage up the balance sheet over time which those tr the companies you want to avoid from a creditor perspective. being the acquiree, maybe a good position. >> mike wrote a final word. you have been looking at small caps. and they have had nice performance since the election, but overall they are still, how would you describe it? is this an opportunity to kind of pick them up broadly? would you be more tactical? >> we think broadly. coming into the year we were bullish on small caps. based on earnings accelerating off the bottom, cheap valuation. you have reshoring as a nice tailwind for earnings growth. earnings growth negative the last two years for small caps. heading into next year consensus estimates are 18%.

does it go that high? i don't know. if you get going from negative to potentially double-digit growth, that's a positive. reshoring is not only continuing, it's going to accelerate under trump but with tariffs and small caps are a great beneficiary of that. on the m&a wouldn't be surprised to see large companies and private equity get more active acquiring small cap companies frchlt a long-term perspective the group continues to be underowned and you have good fundamentals and attractive valuation, it's a pretty good setup. >> thank you. appreciate it. coming up shares of defense companies are climbing despite a miss on the top and bottom line. deere, for instance, beat in earnings. investors seemed to like the ceo's comments about the company insulated from tariffs as they export more equipment than they import. deere shares up about 9% today. meanwhile, te a akquick break. we will have more on "the exchange." don't go anywhere.

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shares of ulta down 2% after a downgrade to market perform over william blair. analysts right the early 2025 infliction, the beauty industry expects for is unlikely and migration online will continue to cannibalize retail. shares down 13% over the past week. berkshire has been a seller as well hitting the lowest level since mid-august. elf, which supplies into ulta stores, up 2% today shaking off the short report. carson block made his case here on "the exchange" yesterday which sent the shares down 10%. alleging that elf has been overstating revenue and profits. they are higher today. the company also issued a response this morning writing that money waters is relying on incomplete data and flawed assumptions omitting critical context and speculation as fact. the ceo will be on with jim

cramer tonight to respond to the report at 6:00 p.m. eastern. coming up, the combination of the incoming trump administration and fed rate cuts has deal making set to pop next year. we have the numbers and the industries re foipr some of this activity next on the exchange. >

exchange. wall street is betting on a ramp up in deal making under president-elect trump's return to the white house. potentially opening up the floodgates for pent-up deal activity. the latest read showing overall deal volume could rise by 10% next year, actually sounds modest. joining me is mitch berlin, vice-chair at ey america. the way that people are in the markets are talking, you think we are about to see a double. >> you would think so. but you have to split that in half because part of that is private equity and part is corporate. the private equity side will see a 16% increase and corporate we expect an 8% increase. a lot of that volume coming from private equity is really just from pent-up demand. a lot of dry powder, a lot of matures is sets coming due in terms of the debt leveraging

those assets that they have to shop around. it's really a tale of two cities in some ways. we will see modest corporate growth and probably significant p.e. growth. >> a segment we call newspaper headlines from the future. so it's 2025. it's january -- honestly, maybe the next month or two. why wait? these things take a long time to get passed. what kind of headlines should we anticipate? >> i think we will see larger deals. i think the headlines will say technology still remains the number one sector for m&a. a lot of that due to a.i. everywhere. so non-tech acquiring tech as well as tech acquiring tech. i think a headline that says oil and gas continues to be a major player in m&a, less from a volume performance but from a value perspective. these are big meaty deals. and i think you will see life sciences decides to free up cash on balance sheets and make

acquisitions. they have very cash rich balance sheets. they need to repopulate the r&d pipeline. so you willsiak sixes made there. and i think probably another headline is that deals are easier to get through the fdc and doj approval t they still have to go through, but i think more had pass versus being killed. those are four big headlines coming up. >> i love it. i think we should keep going. one of the biggest beneficiaries are the companies -- i mean, for instance, piper sandler, this idea, this refrain that the bankers are coming because they are. and piper sandler shares doubled this year. that's incredible. >> that's not surprising. we are working with clients too clean up the businesses that they want to sell. a lot of value creation exercises. the ebitda is higher. the bid ask, there is a large gap between the bid and ask. if the multiple is lower if it's applied to higher ebitda you are going to get more value for that

deal. when we think of all of the work that we are doing to clean up operations and make these companies more profitable and greater ebitda, no surprise they will be shopping these in the next year. >> let me sneak this one in there, maybe the most important question. is this deal boom going to happen even with rates at current levels? >> it will. we actually think the rates will go down another point in 2025, maybe another quarter point this year. it will happen. a lot of these deals are through cash on the balance sheet and the capital markets are very healthy. there could be a lot of stock deals dealers as well. private credit continues to be popular. three quarters of the deals that were funded by credit, private credit this year. >> totally. it's been a huge source of the growth. we will wait to see how well investors do. for now, as you made it clear, those headlines are that the deals are coming. thanks for joining us to talk about it. appreciate it. >> thank you. >> mitch berlin with ey americas. that's it for "the

exchange." i will join you on the other side of this break. ia, weather. 70 degrees and sunny today. amelia, unlock the door. i'm afraid i can't do that, jen. ♪ (suspenseful music) ♪ why not? did you forget something? ♪ (suspenseful music) ♪ my protein shake. the future isn't scary. not investing in it is. you're so dramatic amelia. bye jen. nasdaq-100 innovators. one etf. before investing, carefully read and consider fund investment objectives, risks, charges, expenses and more in prospectus at invesco.com. new projects means new project managers. you need to hire. i need indeed. indeed you do. when you sponsor a job on indeed, it's easier for talented candidates to find it. which makes it easier for you to hire them. visit indeed.com/hire

♪ (vo) with verizon, trade in any phone, any condition, which makes it easier for you to hire them. and get iphone 16 pro with apple intelligence. on us. and ipad and apple watch series 10. all, three on us. only on verizon. ♪ welcome to "power lunch." alongside kelly, i'm tyler. welcome. markets are moving higher this afternoon. the dow up 500 points thanks in large part to salesforce and goldman sachs. and nvidia has now turned