to amazon, it will continue to work in 2025, not just immediately. >> jow have the lost word. >> sabra with a 41% dividend yield, as 65-year-olds are aging, it means a lot but for skilled nursing and retirement, it's all good. >> that is going to do it for half-time. the exchange starts right now. thank you very much, frank, and welcome to the exchange. i'm kelly evans. we have a big selloff on our hands today. a market change from yesterday's sleep your session. big tech is getting pounded. all the mag 7 names are getting lower, and they are saving more than 200 points on the nasdaq 100. bitcoin is also falling down about a percent, and mizuho's dan dole of says one of these names is seeing a big shift in retail trading.

plus, the market is only expecting two rate cuts next year, but one retail analyst says that might be enough for the housing market. the stock, down about 5% this year as one of her topics. we will reveal it, and two other names she likes, coming up. stocks and yields are lower, so you can't blame yields.

>> the santa claus rally is not looking great, folks. we closed monday, 59, 74. the tendency for the market to rise in the last five days, first two days of the new year is the santa claus rally. you have to be above 59.74. santa claus is not looking that great. the dow is weak because of tech. microsoft, salesforce, amazon, apple, those four or more than 200 points on the dow, and that is affecting the nasdaq as well. if you look at sectors, it's the tech oriented sectors, technology, consumer discretionary, you have amazon and tesla in there. communications, because you have alphabet in there, and you go down the list, a little less damage when you get into

defensive sectors like consumer, staples, and healthcare. kelly referenced palantir, one of the big names of the year is down, probably the most on the s&p today. declines there, nvidia, microsoft, right across the board. even when you look at smaller stuff, we used to call this speculative technology, roku and robinhood. they are also down, varying degrees on the day. consumer staples here, naturally, there is this classic tendency, when you are selling off gross stocks, to have modest gains in consumer staples. in a sense, this is a very common playbook overall. as for 2025, kelly, mega tech earnings growth is going to still be very strong, but not as strong as it was in 2024, and so, there are a lot of people very hopeful that we might see some kind of rotation out of some of the mega cap tech names we have been seeing, and maybe into the other 493 stocks in the s&p 500.

>> how much do you make of trading days like this, bob? we are going to be down sharply if we stay where we are, but it's a thin trading session. is this meaningful information, for instance, if the s&p goes below 50 today? i don't think we will look back and say, well, it was december 27th. >> i don't put too much stock -- it somewhat understandable to see people rotating out at the end of the year into some of the major winners, like palantir and broadcom and nvidia, and into slightly more defensive sectors. we have been arguing about this rotation story for ages and ages. we get moments where it happens for a few weeks, and it falls apart again. arguably, you can make a very clear argument from a valuation perspective that sectors like healthcare, materials, industrials, are far more fairly valued than technology stocks. this has been the classic value argument. the problem is, it's not

working. it has not been working for a decade. for whatever reason, investors are preferring growth names of her classic value names. look here. these are the estimates for 2025. nvidia is going to have a 50% increase. it was up 120%. these are earnings, not prices, earnings expectations. look at broadcom, amazon, these are really strong earnings. can you get people to say, okay, guys, we've had enough. the earnings are still strong, but they are decelerating. can you make that argument the people out there, who have been holding onto these things for years now and say, guys, healthcare is undervalued? materials are undervalued? they are going to have very nice earnings increases next year, but not, perhaps, as much as the technology names. let me show you what the magnificent seven is for this quarter. we are expecting 24% growth in the fourth quarter from the magnificent seven stocks. now, that is great. next year, at the same time,

the expectations are only 18%. still good, but it's decelerating. how about the other 493? right now in the fourth quarter of 2024, we already saw 4%. this is the rest of the s&p for this quarter. next year, that same 493, the expectations are 14. well, that is growing. that's good. we want that, right? yes. all good. that is not anything close to what we are seeing in the technology names. look, in theory, technology is the leader. this is the earnings growth for 2025. look, healthcare is still there and industrials are still there, and materials are getting a bump up next year, but it's really difficult to get investors interested in that. of course, this is what makes everybody nuts, the value people, nuts. by the way, people ask me, why are we expecting corporate profits up 15% this year? just look at what we've got here. the economy is growing at 3%. companies still have high prices they have been able to have since covid. we have much better cost controls.

a.i. is helping companies be more efficient, and finally, look at this net profit margin, up 12%. not only are they making more money, the prophets, the amount they are keeping from the revenues is higher. that's what a net profit margin is. kelly, that's near an all-time record. when you have prices up and profit margins at all-time records, this is one of the great handoffs of all time you could ever possibly have for next year's stock market. it does not get much better than that, and that's why the market is so strong. >> bob, thank you. at least, most days. rick, over to you. i don't think it was wholesale inventories this morning that spoke to the market. you tell me. >> no, i think wholesale inventories were a bit of a drag, and i think there is a bit of a light aura to the markets today, but let's really look. bob didn't think there was any specific headline that made stocks a very deep shade of red. i may disagree. look at the tenure chart. we are closing, most likely,

today, at the highest yield since the end of may, but we are only about seven basis points away from the highest yields of the year, which were april at 4.7%. we are creeping up. right now, should be close here, we would be up nine basis points on the week out of 10, but we would be unchanged on a two year period anybody, who is really looking at central banks as being the big topic for 2025, certainly, we are going to be talking about them. certainly, we are going to be scratching our heads, but long dated treasury yields, long dated yields across the globe are moving higher, and that is something to pay attention to. it's based on debt. it's most likely because of issuance. look at the 10 year, it's near the mid-460s. it's looking to close at the highest yield since 2008. look at gdp in japan, the tenure at 1.1%. it is hovering at the highest yield since 2011.

if you are looking at france, they have issuance issues. their yields are moving up as well. all of this is almost the perfect storm at a time where global growth is questionable, and we can all say how great the u.s. economy is. there is no doubt. we are much better than all he competition, but we overspent much bigger than the competition and a lot of that money is still sloshing around. much of it has been legislated, but it has not necessarily been disbursed entirely yet. maybe the next administration is going to put the kibosh on it, but as things sit now, we are really at a crossroads with respect to interest rates and their effects on everything. is there going to be enough buyers for all the issuance? i don't know the answer to that. many believe paying attention to individual auctions is a mug's game. i say one of these auctions, whether it's in this country, the uk, whether it's in japan, is going to start to get a little more messy and things

are going to move in unison, just the way they are starting to move right now. kelly, back to you. >> i thought dave made an interesting point yesterday about the balance sheet, because he thought that is a big reason why higher rates have not had more effect, but even he thinks that is going to sunset. we get to the middle of next year, and it will be something more like historical norms, about 20% of the economy. one reason that he thinks monetary policy will have more of an impact, high rates may have more of an impact on the economy. >> yeah, i think the fed and central banks across the globe are not going to have a very happy 2025, because in my opinion, no matter what they do, it is important, we all need to pay attention. it's going to jangled the curve, most likely, continue to make it steep, but at the end of the day, what is going on is going to be the star of 2025. just consider 210 spread just crossed over 30 basis points. that is why does it has been in over 2.5 years. >> rick.

thank you. rick santelli. the broader market is trying to close out with nice gains here. the same cannot be said for small caps. the russell 2000 is closing out with its worst month in two years. it's down 8% in december and that leaves it up only 8% this year. that compares with a 25% climb for the s&p 500, but my next guest says that is about to change. small caps outperform large caps in the six months after a half- point rate cut in the third year of a new bull market, and in the first year of a new presidential cycle. nancy pry liz here, portfolio management or at essex management. nancy, you know as well as i do that past is often not prologue. >> that's very true, and these are just correlations, not causation, they are historical facts, and there is no certainty they will continue. having said that, we have seen modest, it still in a performance for the past six months of the smaller cap segments.

more fundamentally, what we are starting to see is a spreading of he growth opportunities in some of the smaller cap beneficiaries of many of the economic trends that have been driving those large-cap, particularly, mag 7 stocks. if you look at, for example, a.i. or infrastructure spending, where that might have been much more concentrated, at least, in what we have seen in terms of earnings growth over the past six to 12 months, we are starting to see many more beneficiaries, meaning the software companies, the services companies that are making use of that a.i., that are now seeing accelerated revenue, and we think that is the factor that will make the necessary valuation that we have had, that will be the factor that makes it necessary and sufficient to get a reversal of this 10 year trend of small caps underperforming large caps. >> i'm at the point where i am

taking them out of my diversification. the 401(k). i don't want the small caps. i don't want them. what are they going to do for me at this point? it's like the international. get rid of the international, get rid of the small caps. it's all gone. s&p all the way. >> you are right. a lot of people do feel that way. even as a small-cap investor, some days are frustrating. having said that, we know that all markets are cyclical. we know that nothing goes up forever, and so, when we get to that point of such incredible pessimism with the percentage of stocks and the small-cap universe down just 4% of the investable universe, a historical low. the last time it was this low was back in that the 1930s. that is a period where you don't want to take that out of your allocation. you want to add to that in your allocation, because if you find those companies that can outgrow, and i'm not saying to buy passive index and small-cap. passive index is an area where you need active management,

because there are a lot of non- earners, but we find those companies with those tailwinds, economically. the balance sheets, and the profit margins to support their growth, that is how you can outperform in this environment. >> you have several in mind. one of them, amberella. tell me about these. >> three of these are plays on a.i. pegasus is a software company that is focused on automation, focused very much on the customer relationship management for the business. thanks -- sales force productivity. they are a user of a.i., as opposed to selling the a.i. for their customers to use. growing very nicely. approaching the rule of 40,

profitable, all of the things that investors are looking for. it's starting to be discovered but we don't believe it's fully discovered, and they have some great new products they have come out with in the last year. similarly, avepoint is also a player in the space. when you think about all of this big data, all of the data out there, both a.i., as well as all the other applications, you really need data governance management. avepoint partners with microsoft's copilot. nice profitability. arcosa is a little bit different. they are an infrastructure play. they are infrastructure in terms of the power grid, but they are roads, bridges, lng plants, barges, where we are seeing a replacement cycle because barges and other tankers are very old. this is the re-shoring up manufacturing in the united

states. it's the bipartisan infrastructure law, and we think it plays incredibly well with some of the things that president trump is going to want to do. finally, ambarella, a semiconductor company, machine vision robotics. i don't need to say more than that. >> people are already buying it. i'm kidding. we look across these four names, it's a good example, at least, with active management. two of these names have doubled, the others are up 20%. that is not too shabby for an index that is only of eight. nancy, we thank you for joining us. >> have a great rest of your year. >> nancy prial with essex. openai is officially laying out plans to change the company's corporate structure. kate rooney is back with the details for today's tech check. >> kelly, great to see you. this transition has been anything but smooth for openai, and it does highlight an increasingly competitive landscape, compared to when this company was founded about a decade ago. it is the first time openai has

laid out these plans. it's for-profit arm is going to be known as a public benefit corporation, a pbc. essentially, the same as any for-profit business, but it has a dual mandate. fiduciary duty on one side, and a publicly stated mission. ben & jerry's and patagonia are well-known examples, and openai acknowledging the cash crunch behind this decision, saying, we once again need to raise more capital than we imagined, and in part, investors need conventional equity unless structural misspoken this. that structure has been a headache at times for openai. it was on display when ceo sam altman was ousted about a year ago. it can also be confusing. it involves a capped profit company controlled by the nonprofit, which will still exist, and the structure, as you can imagine, not something that investors love. they are relieved this is in the works. they really want a pure play,

for profit. it also makes it easier for openai to go public at some point, and competition. it is really on display here. musk's is among those competing. musk is also an openai cofounder, and is suing to block this whole for-profit pivot. openai, fighting back in court, but certainly, a headwind here, and threatens to delay this whole plan. >> the whole ambition for them to go public or have any kind of future as a company, it relies on them being able to make this transition, which some legal experts and nonprofit experts have questioned. have -- and they even really pull it off? this is their attempt to try to. >> they are deeply unprofitable, losing, from what i'm told, about $5 billion a year. i think the ipo plan is still a ways down the road, but they have to get the house in order. they have to figure this out, not only if they want to go public, but if they want to keep raising money from some of the big venture capital investors, who want their financial interest to be aligned with the board.

they don't want the control of the board to be true nonprofit. that's one of the things they laid out as reasoning in this blog post. they did say, we need the incentives to be aligned with some of the big-time investors. you can imagine, it's not going to be appealing as a nonprofit. it has not been. >> even if they pull this off, down the road, when regulators are coming after all the a.i. monopolies, they will come back and say, why were you originally a nonprofit? oh, you were doing research. you were scraping research off the internet. i really think it is, until the equivalent of congress understands the whole story that is taking place here, there is going to be a lot more still to come. and, to come at this company for how they did exactly what they did. for all the benefit they have given the world, it was kind of a shady way to do so. >> it has been interesting to hear sam altman described the decision could they sort of did not know how much money this was going to take. that's when the justification, we were a nonprofit, and that

was the way we are going, we did not realize this whole mission was going to take maybe $100 billion, hundreds of billions of dollars, at this point, and that is the way they have described it. there is not a lot of trust in that from folks in silicon valley. elon musk, very publicly, has challenged that. the knock on musk's argument is, he now has a vested interest in a competitor. openai pushed back and said, we know what you think, but also, is there a reason you are doing this? maybe it's because you have one of the biggest competitors. it has been interesting to hear the two narratives, but you are right, there is a lot to look back at, just in 10 years, as -- in terms of paper trails and decision-making. >> we will see if they can do it elegantly, successfully. kate, thanks as always. coming up, bitcoin is down 11% from its record high of 108,000 less than two weeks ago. just above 94 today. we will look at what to expect from crypto, the exchanges, and

fintech. plus, another 2024 ipo seeing big gains, service titan is up 51% since going public on the nasdaq a couple weeks ago. one industry watcher says the ipo window is opening back up and there is a strong list of candidates waiting their turn. we will dive into who is next in line, when the exchange returns. >> this is the exchange on cnbc. (♪♪)

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welcome back to the exchange. bitcoin prices hit an all-time high. it was just over 108,000 on december 17th, but since then, do we call it a correction? it's down 11%. it has dragged down the legs of coin basin robinhood also, and there could be more pain ahead, according to my next guest, who sees increased competition in 2025 with more crypto exchanges entering the market. dan dolan is back. the coin base people are throwing eggs at the screen, dan. come on, we did fine at the end of the year. what's the problem? >> i know, and it has been a bad call. sometimes, i had bad calls, i had good calls. it has been a bad call on coin base. kudos to them, but i still think if you are going to that on crypto, your better bit is robinhood. i am not a fan of crypto, as you know, but you're better bit is robinhood, and that's

because of the diversification of the revenue stream, so i still stand by my call that coin base fees are too high, and more competition will drag them down. the difference in fees is mind- boggling. >> for the point on this, when we talk to the coin base bull, talking about why the stock was so strong in the past month or two, it's not just bitcoin, it's all the coins. whatever goofy -- not goofy, some of them are real protocols, but the idea is a lot of that activity -- i don't know if you have the numbers -- is happening on that platform. >> that's a good point. they do make more money off of these altered coins. there is not so much -- the word is nice to call them alt coins. right now, i went to the robinhood analyst day, and they said that coin base is listing

over 200 tokens, and robinhood, about 20, much more conservative, but robinhood is growing the number of tokens. even on that apples to apples comparison over the next year or two, you will get a lot more tokens traded on robinhood than today. it has been true in the past. it might not be true in the future. >> which other exchanges are coming into play here and adding to the competition? >> there have been some reports about crypto.com meeting with trump, et cetera. i see the same news you are seeing, but let's call this the administration embracing crypto, which has been the thing everyone is saying. it's definitely going to drive more exchanges to go public. more exchanges to increase their presence in the u.s., because it has been easier to offer crypto token trading in the u.s. >> i appreciate you assume i am following all this news, but i need you to draw my attention

to those points where you see real change happening. let's talk a little bit about robinhood. you think it's better set up. they recently announced they are getting into sports betting. they do have all sorts of financial products. they are trying to get more retirement accounts on the platform, and you like that model, versus the crypto pure play. >> yes, they are going global. they are eyeing $600 billion globally. they just opened an office in singapore this year, and about -- i think it was 70% of bitcoin trading volume is in asia. definitely, huge standout there. the better bet here on robinhood is, a, the fees are lower, and b, if the day comes and i am right, and maybe crypto trading is not as exciting as people think it is, there is much more -- there are equities, to your point, retirement, et cetera. this is more conservative and

being diversified, versus putting all your chips on crypto trading, which is what coinbase is all about today. >> two final questions. i'm curious for an update on sofi, which you were bullish on last year. also, the buy now, pay later platforms. what is the outlook for 2025? >> let's start with sofi. on coinbase, we have had some great calls this year. one of them was sofi. i kept taking out myce target and it kept reaching my price target. i think it was josh brown that said, people say their financials have gone up too much, but if you look at it from history, the historical perspective, it has not moved that much. let me give you the catalyst here. one, they are now doing lending as a platform, so that allows them to do more lending with absolutely no risk on the balance sheet, and be all these things like student loans, mortgage, they have all been dormant for the last two years. all these are going to open up in 2025 and i see much more

upside for sofi. to your point on buy now, pay later, i have done some analysis that looks a comparison at firm versus klarna. when you look at the numbers, you see a firm having a take rate, two times more profitable. their business model is so strong and so rigid, and now they are getting into europe. i think my ipos in the buy now pay later space will shine a positive light on a firm. >> maybe it will happen sometime next year, and we will be looking more into the economics, the regulatory pressures and so far. dan, i'm trying to figure out where you are that it's dark outside. >> i am in tokyo. i got here with the family today. nothing to do with work. but, it's great here. >> cheap, right? >> it is, actually, really, really cheap. especially, when you come from

new york. by the way, the tip is included, so it's even cheaper. >> i am not going, but your family is lucky that they can go with you. dan, thank you for taking time out of your trip for us. we really appreciate it. dan dolev with mizuho. so that coming up, the nasdaq 100 is on pace for its worst day since the 18th. tesla is the worst performer out of the bunch, down 5%, ilog and merican power are vying for the top spot. more of the big movers when the exchange returns.

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welcome back to the exchange but i am kate rooney with your cnbc news update. nato says it's boosting its presence in the baltic sea after the suspected sabotage this week of an undersea cable. it comes as the finnish police ordered a russian oil tanker, to investigate whether it damage the cable that carries electricity between finland and estonia. this is the latest disruption to undersea cables being this -- investigated as an act of sabotage. the cdc said a mutation of the bird flu virus shows mutations that would make it easier to spread to humans, but

there is no evidence the virus was passed to others. the cdc said earlier this month the patient was likely infected from contact with sick and dead birds in a backyard flock. in mexico, the government is testing a new cell phone app that would allow migrants to send an alert if they believe they are about to be detained by u.s. immigration officials, to warn their relatives and the nearest mexican consulate. it comes in anticipation of president-elect trump clamping down on immigration but he takes office in january. back over to you. still ahead, another look at our mystery chart. it's a popular home appliance, but i think someone already guessed it. the shares are down about 6% this year. we have a little more time before we reveal that name. read it, and waste are are some of the biggest ipos, finishing the year strong. read it up 23%, this month, we see 10 high profile companies with a greater than 90% chcean

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welcome back to the exchange. names like microsoft, alphabet and nvidia are down 2% today with a big xlr. a big part of that is a.i. public companies were not the only ones funneling big bucks into technology. a.i. captured more than a quarter of all the venture dollars in quarter three, and while deals have been slow this year, my next guest thinks they will pick up in 2025. duncan davidson is back with us. he is a partner at bullpen capital. i feel like you are, what do we say, duncan? we pooh-pooh. the fact that you are more rob roth on the pipeline makes me more hopeful. >> last year, you had me on for reddit, and i said, it's not going to start away. it did really well, which i thought it would. this year, i am cautiously optimistic that service titan will start the way. why? what has changed? everything seems different now in vc.

three years were down, last year was more about separating winners and losers, that this year, the people are looking for exits, so besides the ipo window, we have the ftc had, the woman that i call darth khan, because she killed big tech m&a. the new head will allow the big companies to start buying things again. that leads to all kinds of exits. both ipo and m&a. that's why i am more optimistic this year. >> that is so interesting. i don't really care as much about the dealmaking. i want ipos. i want ipos, and i can take the argument, and i have heard this argument made, if companies, if there is no path to some kind of acquisition in a way that diminishes even the excitement around an ipo, you just want there to be a lot of different options for bringing the sink out to the public. maybe it becomes part of a tie up down the road. we will see with the new ftc is

like, but who do you think is going to be first out of the gate? >> i think it might be time. stripe has also filed, and a few others, but chime is a wonderful company. i would look for them to get out quickly. another one is cerebrus, it is an a.i. chip company, and they have a new idea. they have functioning chips, so to speak, which is a difficult thing to do. if they get that done, it will be a hell of an offering. >> was it data bricks, and others that were trying to find ways to give liquidity? i don't understand how it could've not been receptive this year. the s&p was up 30% and people were hungry for tech. all of the ipos did pretty well. what is everyone waiting for? >> you have to accept that the

u.s. government in its wisdom, after the 2000. .com bubble, it made it expensive and not at all what it used to be, and it has not gotten any better. no change has been made. in fact, there are new regulations that keep getting thrown at the whole ecosystem. so, i do think having a deregulatory oriented sec or government and ftc is going to help people want to go public and not just suffer. what has happened is, they come up with alternative ways to take the benefit of being public without going public. they found ways to get liquidity to employees with stock options without being a public company. the market always finds a way around all the rocks and obstacles. if we get rid of some of them, we can go public again. >> i like the list you were starting to give us. who else do you think will be candidates to emerge into the public eye next year? >> stripe is the one i have been waiting for. that will be huge.

stubhub is another. there is a company called klarna, which are venture fund has a small interest in that might get out as well. those are some of them. you can see a theme, a lot of fintech, as opposed to saas. >> are you bearish on saas? >> the multiples are not very good, so why take your company out when the multiples are not going to be exciting? you are looking for markets. fintech has also had a big push down in multiples, but it's coming back. that is what the vcs look for. they don't want to take the company out prematurely with a bad multiple. >> duncan, thank you. service titan was the biggie. what a great story. those guys were working with their dads in construction, and they start a software business. i guess that is saas. >> i will say this about service titan. it's losing money. it's very promising when a tech ipo is losing money and it's a

really good reception in the public market. >> we are back to normal. >> exactly. we hope so. we want to be back to normal. happy new year. >> you too. great to check in with you, as always. hopefully, we will be busier and see more of you next year for the ipo window. let's stick with the private market and what it can tell us about the state of cleantech. no one is talking about cleantech in the ipo space. pippa stevens is here but that story. >> you might think that investors have lost all interest in clean energy, but in private markets, there is, actually, still it is attracting billions of dollars. climate focused funds have raised $40 million this year, up 20% from last year, and just below 2022's record level, according to data from sight line climate which month of debt driven by infrastructure funds. that said, employment has slowed. there is now $86 billion in dry powder, as investors become

more selective on what they are backing. additionally, while there is capital available at the earliest and latest stages, the missing middle, or capital required to help company scale that are ready to be public, remains absent, and is leaving a critical funding void in the climate tech innovation ecosystem, particularly, for scaling breakthrough technologies. mike callier from weaver told me that large public energy companies are one source that can fill the gap, given broad investment portfolios and deep technological know-how, and they are already playing a big role with corporate vc representing about a third of cleantech funding. the bottom line here is money is still there, but no one is chasing unicorns, and people are being a lot more selective. >> you said something interesting the other day, which is, we could see an elegy company in the pipeline next year. >> venture one filed a couple weeks ago, at this point. we don't have any indication on how much they are looking to raise, they are already exporting. they have one facility in louisiana.

they all have their own names. they are also working on plaquemines in louisiana, and that one could come online next year, not reaching full production, just yet. they are a name to watch, and with all of this potential demand backing lng, particularly, when we look to europe, as well as china, japan, south korea, all these companies are banking on u.s. gas. that could be one to watch next year. >> we have been getting into the weeds, but how about some energy names? that would be something not on many people's prediction cards, i would think. pippa, thanks. pippa stevens. 2024 was a good year for retail. it's about half performance of the broader market. it's not terrible, but walmart, costco, kroger, they had a blowout year. our analyst said while value oriented retailers were hot, big-ticket spending could be the story for 2025.

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shares of costco are under pressure today after the eighth d.a. raised its alert level on an egg recall. the new york-based firm recalled nearly 11,000 units of organic raised eggs sold under costco's signature kirkland brand. that was due to salmonella concerns. no illnesses reported at the time. the fda updating its recall classification, saying there is a reasonable probability that using the eggs could cause illness or death. nbc news reached out to the fda with questions but has not received a response. costco shares are down 4% since that recall was announced. we are back right after this.

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welcome back to the exchange. let's get one last look at our mystery chart. if you guessed whirlpool, you're right again. shares are down 5% for the year, but my nest -- next guest names whirlpool. she is betting on big-ticket home related spending to be a big hit in the new year, and also likes mohawk and temper seeley. let's bring in laura schein. you threw me for a loop, laura,

with the whirlpool pick. welcome. >> thanks, kelly. thanks for having me. >> the reason i say that is, whirlpool seems to be the kind of company that every time he turns around, something else happens. washing machines, appliances, this started with the obama administration doing tariffs. here we are, they have to complete in the global markets. why do you think this is now a stock that is poised to shine? >> to address your confusion, we mentioned earlier this year that this stock has never been a great stock over a long period of time, but if you catch the cycle right, the moves can be really powerful, and they are operating now, after two years of declines similar to 2008 and 2009 in appliance units. they are operating at 75% of capacity in their plants, which are largely domestic and vertically domestic, meaning you won't really see supply chain issues with components, so next year, interest rates have come down.

perhaps, not as fast as some of us have hoped for. maybe there will be fewer cuts next year, but typically, in a cycle where we are seeing interest rates falling, demand in these categories improves, and this is a company with spring-loaded earnings power. during this downturn, they sold their european businesses, which were never going to earn their cost of capital, so thrilled to see them out of that mess, and really focusing on their domestic market, where they have about 30% plus market share. all three of those companies, mohawk, tempur, very well positioned to weather any issues with demand, and very well positioned to benefit as demand comes back. >> i'm sure you are getting all these questions, and we get the same about, where are some of places i can invest with? american supply chains, and so forth. i don't know, does whirlpool manufacture domestically? >> almost all of their manufacturing is domestic.

you will see them also producing components close to where the factories are based. so, if the company with a lot of facilities in ohio, so manufacturing in the south, but still, they also own kitchen aid, which makes all of the great stand mixers, and unionized plants in the midwest. a domestic manufacturer that should benefit from tariffs, and they have been at a big disadvantage buying steel from domestic manufacturers, where as their competitors, some of the korean competitors have been buying half-price steel from china over the past two years. >> i could never figure out why the kitchenaid stand mixer is so expensive and so heavy. the handheld blender is like a five dollar thing, why is putting it on a stand suddenly make it $250, and it weighs so much i can't even lift it off the shelf? >> right. they have earned that. they have had plenty of competition for decades now, but i think the durability of that product, you can see the labor that is in it, and also,

the strong components that they've got in those models. you see other businesses where they did not have as much of a quality advantage. they used to own hoover, which was a massive brand. you really don't see that anymore. they have divested things that have not been viable. they are left owning a really good package of brands, we think, and if you do see a recovery, i'm not looking for a v-shaped recovery, but just gdp growth in these categories. you would see 20% plus, eps growth next year. >> what do you expect for the housing market, broadly? >> we would expect a recovery starting in the back half of the year. i feel like this is the same thing i would have set a year ago. the back half of 2024, you would see improvement. that has, obviously, been pushed out, but at some point, there has to be a little bit of a lift. existing home sales, existing home turnover, we watch that really closely. i would love to see some

improvement next year, and we will see if we get there. hopefully, supply of housing improves as we move into the back half of next year. there are still some remodeling's that will have to happen from the storms earlier this year. that should give a lift to some categories like flooring in the first half of the year. >> i know you are looking for that recovery in home depot and others, if that happens. laura, i appreciate it. always a pleasure to check in with you. you kind of convinced me. laura champine, bullish on whirlpool, joining us from loop capital markets. that does it for the exchange today. i will join steve for power luh t onconhether side of this quick break.

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love you, too. agentforce helps retailers prevent fashion fails. it's what ai was meant to be. ♪♪ i'm kelly evans. he is steve leishman. stocks are lower but they are the worst levels of the day. nasdaq down 1.6%. we are wondering what happens to the santa claus rally. apple hitting a roadblock today on the way to 4 trillion. the big tech components of the dow are dragging on the index and the leaders of the nasdaq, we may not know they are in the nasdaq 100. starbucks, pepsi