Shopify. Shopify. Look at this stock since Q4 2022, guys. It's up 30 and 94% from those Q4 2022 lows. Incredible performance. But the thing you got to understand about Shopify Shopify is this. That stock fell 84% peak to trough from where that stock peaked at in Q4 2021 to where it bottomed at in Q4 2022. 84% down. It got obliterated. But the the issue with Shopify, it was a two-part issue, okay? One is people were way too excited about Shopify's business model back in 2021, right? You know, this is still like rona era. This is like max speculation in the market. People were willing to pay anything for any growth stock. The market had been red-hot. So, people just went too crazy with Shopify, right? And they bid the stock all the way up to like $170 a share. In 2021, Shopify had no business being $170 a share. 2026, that's a whole different situation. Like 2026, Shopify deserves to trade at $170 a share, but in 2021, it did not. But it did go there, right? That's that's what happened. like people just they they they try to fast forward years and years of stock market gains for Shopify and it came back to bite them. And then what happened in 2022 is people got way too depressed, way too depressed on Shopify stock. Like they got I don't know, man. They thought it was the end of the world and the stock went down 25 bucks. It was crazy from 170 to 25. But that and by the way, that wasn't the only big tech stock that happened to. I mean, I saw that happen with Nvidia. I saw that happen with Meta. I mean, you know, Netflix. I mean, I could go down a long list of them. And, you know, people went way too crazy with the selling in 2022. It was ridiculous. Right now, meanwhile, all the stock price stuff is the stock price stuff. Look at thousandx.com, pull up the charts feature on Thousandx, and look at all the different charts for Shopify, and you're going to find looks pretty freaking good. Like, you look at the actual business model. Is this not the most perfect revenue chart you've ever seen in your life? Look at the trailing 12-month revenue for Shopify over time, right? This is where we're at right now, right? And this is where things are projected to go. So, we have the past numbers here and we have projected here. Is that not as perfect as perfect can be. So, the stock price of Shopify might be insane. Might be crazy. It might be dramatic. It went from 170 to 25 and now it's up, you know, nearly 400% from the bottom. Wow. Crazy stock. Crazy stock price. The business model looks better than it's ever been. The business model looks like one of the greatest business models in the history of mankind, right? Look at the free cash flow of Shopify on a trailing 12-month basis. It has been ballooning. And you know where what's going to likely happen? That's going to happen. Okay. I love operating cash flow because that doesn't take into account capex, right? Because a lot of times these big tech companies can spend a bunch of money on capex. So operating cash flow I think is even more important at least in my opinion. And look where the operating cash flow of Shopify has gone on trailing 12-month basis. And what do you think's going to happen with it for the next couple years? I'm expecting something like this. It's beautiful. Unbelievable. Right now, additionally, when you look at the numbers, something very exciting going on with Shopify's business model right now. Okay, look it. If you look at the last basically the last quarter they reported, they had about almost 27% revenue growth. No, if you compare that versus the previous two years quarters for revenue growth, that eclipses both the previous years, which means we have a significant acceleration of revenue growth going on right now for Shopify. Right? Look at what they're at in the same quarter in 2024, they're at about 23.4% growth. And then you look at the same quarter in 2023, they were at 25.2% growth. So they've clearly had a major acceleration recently in the business model. Now, if you look at the previous quarter, because you want to try to figure out like is that just a one-off thing or what about the previous quarter? Well, the previous quarter they grew 31% revenue. That's versus the previous year's quarter they grew 23% revenue growth. So, there's a clear acceleration of growth rates happening with Shopify right now, which is phenomenal. Like, this is exactly what you want to see right now. Meanwhile, investors, man, you know, this is what investors do with great companies. They they freak out, right? you know, the stock went through a very tough time in the short term and they were freaking out and they sold that stock and they sold that stock and they sold I mean, imagine selling Shopify at $25. There there's people that did that back in 2022. Imagine selling Shopify at 30, at 40, at 50. And now you look at the stock and you're like, "What did I do, man?" But meanwhile, you got other people that in 2021 were happy to pay $170 for the stock. Like, that's the stock market for you, right? And what it comes down to, these bad decisions come back to gambling, right? And basically a lot of people gamble in the stock market. They're throwing money out there. They're throwing money around, right? They're not actually investing. Investing, in order to actually invest, you've got to understand companies inside and out, right? You've got to research these companies. You've got to be running projections on these companies so you understand, am I getting a good deal on the stock? What if things go wrong? Then where's the stock price likely going? What if things go the way I expect them to go? Where's the stock price going? And what if things go better? Then anticipate where's the stock price going? You got to run projections. If you don't run your projections on thousandx.com, create your own projections chart in a spreadsheet. Okay? It might take you a few hours to do it. It's not rocket science, right? In thousandx, we do it all for you. We already integrate the numbers. So, it's just so much like more time efficient. You can run projections in a matter of seconds or minutes versus uh, you know, potentially hours doing it yourself. But run your projections regardless. Run your projections. So then you can understand you got to run a bull case, you've got to run a base case, you've got to run a bare case. And that is what will end up making you say, you know what, in in 2021, Shopify at 170, it wasn't a very good buy, right? And you could run your projections in 2022 and be like, this stock at 25 is a steel deal of the century. Like I need to buy the stock. Instead of getting emotional about it, you're running math. You're running projections. you're sticking with numbers and not with emotions of, you know, the stock went up a lot, the stock went down a lot. That's gambling type stuff. Okay. Hey, I want to thank you so much for watching that clip. I hope you really enjoyed it. What I'm showing you in front of your face right now is 1,000xstocks.com. This is such an important website in service to use if you want to research companies, if you want to understand companies on a high level so you can hopefully get better results in the market. And we know as the years tick on, money compounds. It is so important. You research companies, you compare companies, you're listening to conference calls, looking at SEC filings, all that's included into 1000xstocks.com. So to enjoy thousandx.com and to apply for that service, you can go to the description area of this video or you can go to 1,000xstocks.com, whichever you prefer. Adam Peter Paca, NBC contributor AP, it's great to have you. Thanks for having me. Good to see you. Nice afternoon with plenty to talk about as we're approaching session highs here. I want to start with a great note you wrote over the weekend basically unrolling the possibility of S&P 10k by the end of the decade based on a lot of the things you're hearing now from say tech companies. You know, it sounds like one of those crazy things where it's 6301 and you think God 10,000 this is one of these, you know, uber bullish idiots that comes on CNBC type of thing. But when you do the math, long-term S&P's growing earnings about 8.6% 6% per year for the last 50 years. I think it's reasonable to assume that with all the AI investment that's happened and we could get 9 to 11% growth for a few stretch year and get us a little bit above the long-term average. And if you kind of take the price to earnings that we're paying around now, that gets you 20, you know, 2030 on 2031 numbers gets you around 10,000. So it was just to kind of get people I I think the reason the market's been very resilient is because all the investment that happened in AI we were always told it was going to be kind of a 3 to four year before we saw started seeing it. So one of the things I'm watching do we start seeing any companies talking about productivity? Microsoft flashed a little last week saying hey we say 500 million here and I think in the next 12 to 18 months we're going to see more and more of that and people are going to start thinking all right warnings can grow 10% in the next couple. we'd be moving beyond the buildout per se and starting to get some of that return on investment. I think that's right and I think if we don't get it then we're going to have a correction in the market. I I think we've seen enough capbacks from the big companies. So what we do at Tribe is we search every earnings call transcript for any mention of anything related to hey we think we can grow our revenue without a lot of net hiring or we're getting better at predicting our our employee behavior or our customer behavior. And the kind of stocks that have worked have been ones where they have low margins, lots of employees. Look at Walmart's multiple and Costco's multiple and even like in drug distribution mckess or whatever like these stocks have started to go up because not because they're they're not high margin they're real they're low but I can dream of margin expansion and that's how I get the multiple expansion at the same time we do have sort of the construction elements still in place Caterpillar today Eden uh you name it GE a good story once yeah I mean if you can take your your net margin from 2% to 4% double baby double totally I mean one of the things that maybe is an obvious because the market as you said is basically at highs. Five of the 11 gig sectors have down earnings year-over-year in the second quarter. So it's not like every single part of the market's you know materials and not everything's clicking on full cylinders. So if we solely get some economic improvement in the industrial side even if the consumer a tiny bit slows we'll just get other things working. I think the other thing that is a little bit weird about the S&P maybe not everyone gets is by the way as we are now record highs at 6303. Yeah. Right there. Right. So 58% of the S&P is three sectors. Tech, comp services, and financials. So if you're bullish on the market, you you kind of have to own a chunk of of of those three. The that's the biggest three sectors have been in over 25 years, right? So everyone wants to talk about breath, but what do you mean? Like the market's concentrated in those three sectors and they're big. Four sectors, utilities, energy, reach, materials are less than 9% of the S&P all combined. So, you know, you can go crazy if you're trying to beat the S&P and own a lot of one of those sectors, but you still own way less than you do in tech. You're gonna own way more tech no matter what, right? Yeah. Uh, still though, people were looking today at the Triple Q's versus the SPY, right? That that that spread's widening a bit, is it not? Yeah. I I think tech has just so much potential here um in in the next two or three years to grow. I mean, if earnings grow 10% a year in the next two years, do you want to be negative on tech? I mean, that's kind of how I look at it. like let's take I just got back from being in London and talking to a lot of European investors and I think they look at the US and just think well the market's expensive versus its history margins are high and I want to own something else and I kind of want to say yeah you know you know if you go to a um you know any perspective on like I was going to say if you go to like a Motel 6 it's cheaper than the Four Seasons well it's cuz it's worse right like there's some you have to adjust for the fact that there's something somewhat inferior about the set of companies that they have there here in the US there's just a lot of high margin businesses growing faster So I don't think it's the end of US exceptionalism. I like the US tech sector. I think the financials are in great shape and uh probably the most contrarian call we have at Tribar is our overweight healthcare call uh where I I do get a lot of push back on, you know, will the AI productivity stuff hit in the next 6 months or is it more hey 5 years from now and it's too early to get in front of that? Are you talking hospitals, pharma, uh insurers? Which part? Um I I think there'll be a sequence. I think drug distribution, diagnostics, uh, you know, hospitals will benefit earlier tools and then in the medium-term it'll probably be, you know, more like the drug development side. But I I kind of look at and say, not everyone maybe knows this, healthc care revenue per share for the S&P 500 has grown at least 25 years every year, right? During co COVID, during the financial crisis, there's a lot of old people. They demand services, tools, diagnostics, testing, hospitalization, managed care. So you have somewhat steadier uh revenue. There are big fears obviously when we're running at a wartime deficit in the US maybe they cut back on healthcare spending do get rid of drug rebates etc. But I I just look at it and think if you and I were sitting on top of the S&P and we said where would we focus our efforts for AI we'd say where there are lots of employees where there are low margins and lots of revenue and let's go there. And so many of those are healthcare companies. So that's why I I think there's just it's not like they're all awesome, it's they're bad and there's opportunity for improvement that gets me more excited. So this is actually a really interesting thought. Let me pull up something for you guys um and show you something here. All right, so something very important he just talked about there was looking at companies that maybe are very low margin right now and might be able to increase their margin quite dramatically over the next few years due to let's say something like AI, right? So, you know, there's two companies that kind of came to mind here. Oh my gosh, Palanteer's valuation. Ah, uh, there's a couple companies that came to mind that I usually think of when I think about kind of like big revenue companies, but man, it's hard uh, for them to hit anything down that bottom line. It's companies like UPS and FedEx. And so, if we look at both those companies, right, UPS looks like it's around a 6% net margin. Uh, FedEx looks like around 4% net margin. companies like that I even think about like man could those companies benefit a lot from let's say AI and robotics over the next 10 20 years and it's like it's very possible you know if if AI can streamline the businesses better make them even more profitable like and then we could talk about robotics being more involved or autonomous vehicles or things like that right there's a lot of innovation that's going on there right now that maybe a lot of that technology ends up being a big catalyst for UPS and FedEx and companies like that to maybe increase their margins over time to maybe like a 10% number. But the push back I'd give on that is that's dangerous to just assume these companies will be able to, you know, bring those margins up substantially. They might not, you know, so you can't you can't bet the farm on thatual person watching this and for every portfolio manager. Unfortunately, I don't have advice that would cover the gamut of what everyone's trying to do. But one of the things that I think is very obvious is now is not the time to be getting more bullish than you were a month ago or six weeks ago. Now is the time to maybe say, "Okay, I've had a good run of a bunch of stocks that are up double digits in a very short period of time." And uh do I still want to have as much exposure as I did when valuations were lower and there was less enthusiasm priced into these names? And for some of you, you'll say, "You know what? Actually, I haven't thought about that in a while, but maybe I don't want to have um a 5% position that just went to 8%. Um and it's not a it's not the same as saying um oh, we're about to have a correction and I predict that it starts in 27 hours. It it's just a recognition that this has been an amazing market to be involved with and a lot of stocks have probably uh outgrown the original size that you put them on in your portfolio. and you might want to make some decisions right now about if today were the starting point, how do I want to be allocated going forward? Joe, coming over to you. Uh, so far very early going, but earning season actually going better than So, what do I think about what he said there? My opinion is I think he's 100% I think he's 100% on. You know, there's nothing wrong with taking some profits this summer. You know, there might be some stocks you hold that have just gotten their ridiculous valuations, right? You see me, I'm taking profits on Palunteer right now and I plan to continue to the higher that stock goes in the next, you know, two, three months, the more I'm going to sell um until I get down to a thousand shares and then I'll likely just hold that thousand like super long term and you know, if it becomes a multi- trillion dollar company or something like that, great, you know, and that that's cool. But um you know, I think that's a really dangerous stock at this stage of the market. And so, you know, given the valuation the company's at, so I'm like, I'll take a lot of my profits. I've already sold most of my Palunteer. I got another 500 shares I want to queue up and get those get rid of those and then I'm good, right? Um and so there's some stocks you'll hold that, you know, I got rid of my Tesla as well. Tesla's another one that the valuation just doesn't make sense given where the business model's at in my opinion. And so sometimes you just get in those situations like like let's cut some. And that's fine. Like this, you know, that's part of the game. Part of the game of the stock market is selling, right? Most of the time you should be buying and holding, but there's going to be some times when you do sell, right? And um those times should be few and far between. But in time periods when the market's been great. I mean, the market's been great now for getting close to 3 years. You know, we're already what, late July now? You know, we're already kind of moving toward, you know, mid to late July. And you know, the market bottomed in October, if I recall, it was October 2022. So, we're not that far. So, that means the market's going to be in a grade for almost 3 years now. Along that way, we've had plenty of corrections and pullbacks and things like that, including the major correction earlier this year. But if you just look at a longerterm trend, we've been in a pretty outstanding bull market for almost three straight years now. So, the market was phenomenal in 2023, the market was phenomenal in 2024, and so far in 2025, it's been a phenomenal market. Like look at where we started the year for the S&P 500. Look where we started the year for the Q's. Look where a lot of these stocks started the year. Look where these stocks are now, you know, and if this market continues to go higher and higher and higher from here over this next couple months, like you know, if it depends on the stock, you got to take it stock by stock. Some make sense to take some profits, some don't. The estimate was 5.7 and a half according to Hellag. Uh right now, do you want to just continue? It's like AMD. Do I am I interested in taking profits on AMD? Absolutely not. Am I interested in taking profits on Palunteer? Absolutely. Those are two very different situations. Two very different stocks in regards to where they're at in their stock cycle, their business model, everything like that. Your winners into earnings. Or is it time to take a few bucks off the table and reposition a bit? Well, I'm going to reiterate what Josh said. It's a little bit difficult to give a very succinct answer to that, but I'll do my best uh in an attempt. I think if you believe this is some form of an inflection point, something similar that we've seen on a secular basis maybe in 2000 2007, then for sure it's definitely a moment where you want to take action in the portfolio. If this is nothing more in the upcoming quarter than a quarter in which maybe the S&P is flat to slightly down uh because we have uh a September 17th Federal Reserve meeting, you have a lot of issuance coming. The long end of the curve is backing up. Okay, you just kind of set an expectation for yourself and you say this quarter is not going to look like the previous quarter and if I want to do some minor selling, trimming some positions, I have no problem with that. But I'm going to stay anchored with the positions that I have. I think the risk in believing that this is some form of an inflection point number one is that you are going to get that rate cut in the fall. The earnings, as you mentioned, Frank, are very strong. And then just lastly, I do a lot of pattern matching. If you go back, you have to remember we had the precipitous decline already this year. We had it in the spring. Go back and pattern match the period from spring of 2018 through the end of 2019. And you'll see that precipitous decline in the fall of 2018. On the other side of that, you had a very steady staircase move higher. Oh, you already know what I'm laughing at. You already know what I'm laughing at. Whenever I hear these guys bring up the fall 2018, it just cracks me up because man, you know how many times I talked about that the past uh 6 months. This pattern match to that time period is very high. That's potentially what we're setting up for right now. So, I think you stay anchored and just set the expectation that maybe Q3 doesn't look as good as the prior quarter. All right, just put this all in context. If we're going from the April lows, NASDAQ's up more than 35%. Uh, the S&P's up more than 25%. The Dow's up just about 18%. Want to come over to Bill Baroo. I don't have to ask you, Bill. I know what you're doing. You're actually taking some money off the table. Why don't we start off with you trimming the triple Q's. What's the rationale behind that? Listen, I I think earnings are going to be good, but remember how how you felt and and what the market was going through in early April. And you know, this is why you take risks like we did in April. Uh is being and you monetize it right here. You we we're trimming things, bringing back to balance, uh taking, you know, creating a little bit of cash gives us a little flexibility as we go through earning season. And um you know, I I think there's just going to be some churn here. We're hearing for maybe a record high close in the S&P today, but I think there could be some churn as the market kind of just digests things. I don't think, as Joe said, it's going to accelerate, but I I do remain overall bullish. I'm not sitting here bearish, but this is just tactically raising some cash. Uh Goldman actually out with a note talking about some of the moves that you're making or at least um referencing a possible move similar to the ones you're making. I'm going to read part of it. Uh the average tech stock in the S&P is implying an earnings day move of under 5%, the lowest in two decades, suggesting completion setup and lower probability of relief rallies. They're recommending hedging tech exposure with XO XLK puts or buying puts on stocks with high earnings revision risk. Agreeing with this strategy? Well, here's the thing. If you're buying puts, you're spending money. Now, you can really protect your downside and there's times to hedge. In 2022, we hedged our downside to use puts. The Fed said they're going to drive the market lower. I don't see this really being the instance here. there. We could get a nice little flush down. I don't think it could last very long, but if the market pulls back, I want to be able to get cash to work. I I do agree with Joe. There's really some great pattern match. I've been going back a couple months ago in May saying this party like it's 2019 and we're going to see a tremendous bull market in the second half, but I do think we have to work through the digestion of the run and earnings, you know, they're going to be good. Beats and raises are expected, but how many quarters have we seen? Maybe not in May. that May was one where the expectations were low and and that reinvigorated the bull market. Tech came in with the AI spend. But how many quarters have we seen in 24 and 23 where the expectations were high and the beats and race they they came but the stocks did not accelerate higher. We could Yeah. The thing you know you don't have to be scared of uh you know a one to three month pull down for the stock market. Like that happens all the time. Put me to sleep. The one you got to be scared of is when we have a market that goes down for one to two years straight. That's the brutal one. That's where you could see the stock market, you know, go down 40 or 50%. Right? Those are the painful ones. And it's like just 18 straight months, 24 months of just damage, damage. And the market just goes lower and stocks just go lower and that's brutal. And at some point we're going to have one of those markets again. It's not like, you know, we're never going to we're always going to avoid one of those. No, at some point we'll get a one to twoyear downdraft and it's going to be brutal. It's going to be vicious for a lot of investors going in. That's one you got to be scared for. But in order for that to happen, you really need the economy to tank hard. You really need earnings to fall off a cliff. When does that happen? That's the debate, right? And that's a tough thing. So, at the end of the day, you take some profits when stocks get rich and you know, you take advantage of great deals out there every week. I'm buying every single week regardless if there's a bare market, bull market, kangaroo market, all those sorts of things.