Cracks In The AI Trade… And AMD Reports Results 11/3/26

Advanced Micro Devices

Across the shows: 7 speakers in other episodes, 7 bullish and 0 bearish calls, past 30 days

• Tim Seymour · Seymour Asset ManagementBullish

  AMD's PC decline is irrelevant; data center is over 80% of revenue and it is a real story.

  A headline about a double-digit PC decline is not the point. More than 80% of AMD's revenue last year came from data centers, and that share will grow next year as the company guides. Customers like Meta and OpenAI are big parts of the story. He calls it a real story that allows for stock picking.

  “But that headline was preceded by more than 80% of revenue last year, next year as Seema pointed out, is going to be data center. That's where their business is.”at 31:19

• Steve Grasso · Grasso Global Inc.Bullish

  Steve is long AMD; its data center revenue share is a big tailwind versus Intel.

  He sees AMD as a stock-picking opportunity in a space where some names can be owned. The share of AMD's revenue coming from data centers is a big tailwind compared with Intel, whose business is more exposed to PCs.

  “There are places where I think you can own the space and I'm long AMD.”at 31:37

• Matt Bryson · Wedbush SecuritiesBullish

  Outperform on AMD: guidance above consensus, ~80% revenue growth, $600 target; 40x growth multiple defensible.

  AMD gave a better number and a better guide. It expects revenue to rise about 80% next year, which implies more than $94 billion and is above consensus. Epic sales are doubling. Gross margins will be lower because of the Instinct mix, with mid-50s guided for next year and for Q4. On valuation, he is comfortable with about 30 times if growth is 80%, and he has pushed his multiple to 40 times. Above that the valuation gets hard to defend, and Intel at 50 to 60 times worries him. He rates AMD outperform with a $600 target.

  “they gave us a better number, they gave us a better guide... they're talking about revenues being up in total 80% next year, so that gives you 94,000,000,000 plus in revenue, which is above where consensus was.”at 33:23

Amgen

• Tim Seymour · Seymour Asset ManagementBullish

  Amgen is a value play at about 10.5-11x earnings paying a 6% yield; numbers were fine.

  He thought Amgen's numbers were fine. Its portfolio is working in several areas, including asthma, blood thinners and oncology. At around 10.5 to 11 times earnings with a roughly 6% yield, the stock is a value play. He has been long the stock for a long time and has been comfortable with its valuation while waiting for these products to deliver.

  “Now at around 10.5 or 11 times, this is a value play that pays you 6% and that's not a reason to hold a dividend, but why not? So I thought these numbers were fine.”at 22:20

• Karen Finerman · Metropolitan Capital AdvisorsNeutral

  Amgen's earnings and guidance were fine despite a Repatha beat and osteoporosis weakness; she isn't long.

  She thought Amgen's earnings were fine. Repatha, the high-cholesterol drug, had a nice beat, and guidance was also good. Osteoporosis was a weak spot. The stock fell sharply on the call for reasons she could not identify. She says she is not long the stock.

  “I thought the earnings were fine. Big Repatha, the high cholesterol drug, nice beat, some osteoporosis weakness... The guidance was also good. I'm not long this one, though.”at 22:58

Pfizer

Across the shows: 1 speaker in other episodes, 1 bullish and 0 bearish calls, past 30 days

• Michael SchumacherBullish

  Pfizer's acquisitions remove its need to tap financing markets, a positive; patent cliff still ahead.

  Pfizer's acquisitions mean it no longer needs to go to the financing markets, which he sees as a probable positive. He frames it as a win: Pfizer is over the COVID cliff but not over the patent cliff, so it still has work to do. Amgen, by contrast, is already past its patent cliff.

  “It takes Pfizer out of the need to go to the financing markets, which is probably a positive. ... And to me, that's a win. So Pfizer is over the COVID cliff. It's not over the patent cliff.”at 23:39

• Steve Grasso · Grasso Global Inc.Neutral

  Pfizer's above-5% yield is attractive, but the stock has gone nowhere outside the COVID run-up.

  Pfizer's yield is above 5%, but the chart tells a different story. It ran up hugely in the COVID years, but going back further the stock has not done anything. He was a long-term Pfizer holder but no longer owns it.

  “So when you look at this, it's above 5%. But when you look at the chart, yeah, during those COVID years, it was huge run up... it really hasn't done anything.”at 24:11

CVS Health

Across the shows: 1 speaker in other episodes, 0 bullish and 1 bearish calls, past 30 days

• Karen Finerman · Metropolitan Capital AdvisorsBullish

  A split of CVS's retail pharmacy from its insurance unit would be good, since insurers have rallied.

  She notes that the insurers around the group have rallied a lot generally, so releasing the insurance business on its own could be good. She also warns that the separation will be complicated and take time. Her view on the breakup is therefore mildly positive but hedged on execution.

  “The insurers around the group has rallied a lot generally, so maybe releasing it on its own would be good. It's gonna be a complicated one to do, I would think.”at 45:15

• Tim Seymour · Seymour Asset ManagementBullish

  CVS's consumer business has value, and the stock's pullback after a near-doubling makes it a good time to buy.

  The pharmacy business has been the part held hostage by investors' changing views, while the consumer business has real value. The stock has had a great run over the last year and its valuation has almost doubled going into this news. It has pulled back recently, which he argues makes it a good time to buy into the company.

  “The consumer business is something that I think has got some value. The stock's had a great run... the valuation has almost doubled going into this. It has pulled back recently. So not a bad time to be spending out.”at 45:51

Apple

Across the shows: 36 speakers in other episodes, 33 bullish and 29 bearish calls, past 30 days

• Karen Finerman · Metropolitan Capital AdvisorsBullish

  Apple has the free cash flow, and money will find its way back into the stock after the drop.

  Steve Grasso argued that free cash flow is the holy grail, and Karen agrees that Apple is the company that has it. Apple's post-earnings selloff, driven by December revenue guidance, gross margins and services concerns, is not a reason to think the report was terrible. Money will find its way back into Apple.

  “They're the ones that have it. Money will find its way back into Apple.”at 6:24

Meta Platforms

Across the shows: 62 speakers in other episodes, 55 bullish and 34 bearish calls, past 30 days

• Tim Seymour · Seymour Asset ManagementBullish

  Meta's latest quarter had great margins and growth, with a fantastic ad business.

  In the last few earnings periods, the market had similar worries going in, but the results gave an exclamation point. Margins were great, growth was great, and the ad business for Google and Meta was fantastic. He sees the hyperscaler results as strong on the business side.

  “The margins were great. The growth was great. The ad business for Google and Meta was fantastic.”at 7:21

Alphabet

Across the shows: 55 speakers in other episodes, 42 bullish and 34 bearish calls, past 30 days

• Tim Seymour · Seymour Asset ManagementBullish

  Google's ad business was fantastic; the market may have got Alphabet wrong and he likes the stock.

  Across the recent earnings, margins and growth were great, and the ad business for Google and Meta was fantastic. He thinks the market may have got Google wrong and that it is a reason to buy. He is more cautious about whether the market's broader problems are solved.

  “it may be what you're saying is I'm going to buy some Google because I like Google and I think the market kind of got that wrong.”at 8:39

Amazon.com

Across the shows: 35 speakers in other episodes, 43 bullish and 8 bearish calls, past 30 days

• Karen Finerman · Metropolitan Capital AdvisorsUncertain

  Amazon's AWS outlook was strong; the selloff came from doubts about funding its huge capex.

  AWS CEO Jassy was very constructive on 2026 and 2028, and he was specific about it, which was all good. The problem came when Amazon talked about capex, an enormous number. The question was how it would pay for that spending. Steve Grasso adds that Amazon has had a year of negative free cash flow.

  “Jassy was very, very constructive on [2026]. Very specific. And 2028. All of that was good. What it ran into was, how are we gonna pay for this?”at 9:06

The Walt Disney Company

Across the shows: 4 speakers in other episodes, 3 bullish and 1 bearish calls, past 30 days

• Tim Seymour · Seymour Asset ManagementBullish

  Likes Disney here; new CEO D'Amaro's efficiency push and cyclical parks recovery make it investable.

  Disney has been in the penalty box for a long time. Its parks business is cyclical, but that cycle is rolling forward. The media business needs to be as efficient as it has to be. Under CEO Josh D'Amaro, Disney is cutting costs, which he sees as something the company lacked in the past. Disney promised double-digit growth in the current fiscal year, and it needs to show it is serious about getting there. He calls the new CEO the right person to lead the company.

  “I like the stock here. I've been very patient. I think Josh D'Amaro, not just because he's from Georgetown, is the right guy.”at 27:15

AI infrastructure & data centers

• Steve Grasso · Grasso Global Inc.

  Peak opposition to data centers should soften after the midterms, a tailwind for the whole AI build-out.

  Opposition to data centers was a big part of the political rhetoric before the midterms, with heavy political advertising. No outright ban has passed, only talk of moratoriums and one in New York. He believes the opposition will fade after the midterms, which would be a tailwind for the whole space. He thinks today may be the peak of the pessimism.

  “I do believe that after the midterms, this peak pessimism or the peak opposition to data centers is actually going to soften.”at 31:51

• Matt Bryson · Wedbush Securities

  Data center spending is strong across AMD, Super Micro and peers; no weakness in the component supply chain.

  Companies reporting last week, Super Micro today and AMD all say data center spend is really strong. From a component supply chain perspective, he is not seeing any weakness. AMD is better positioned because its Instinct chips sell mostly into large clouds, which reduces its cloud-customer exposure. Its Epic business benefits from agentic AI, and everyone needs compute, including neoclouds like CoreWeave.

  “So we've heard from companies last week, we heard from Super Micro today, AMD as well, that the data center spend is really strong. And so from a component supply chain perspective, I'm just not seeing any weakness.”at 34:19

• Keri Findley · Tacora Capital Management

  GPU financing is too risky for lenders because chip useful life is unknown and depreciation could outrun loan terms.

  Her firm sees a GPU financing opportunity a week, sometimes three, and has stayed away. Nobody knows how long a GPU will be usable, so financing it over a ten-year versus a three-year life is a very different proposition. GPU sellers want financing for as long as possible, but she cannot get comfortable with the depreciation risk because new technology can displace older chips. If faster GPUs are plentiful, old ones may only be used for about eighteen months. A 24-, 36- or 48-month financing could then leave little usable life at maturity. She suggests this could become a very difficult area that causes real difficulty in the credit markets.

  “We see about a GPU financing opportunity a week, sometimes three, and we've stayed away. Nobody knows how long a GPU is gonna be usable... we can't get comfortable with the depreciation risk.”at 42:57

US Treasuries & yields

• Tim Seymour · Seymour Asset Management

  Treasury yields have moved too far too fast, though the 10-year is still in an uptrend.

  The 10-year moved 85 basis points in the third quarter. Yields have rallied since the October peak, and while the rates trend is still up, they have gone too far. He wants the market to catch its breath and says rates are important. A pullback or consolidation would follow from the overshoot.

  “Let's catch our breath here. By the way, rates still on the charts on the uptrend... Mean, think the rates are important. They've just gone too far.”at 5:23

• Michael Schumacher

  Expects a moderate 10-year Treasury rally to about 4.75% within a month as fiscal policy eases.

  He says the bond market has been friendlier than he expected. He had thought the 10-year would move to 5% and keep rising past 5.30%, but yields have come back. Long rates are driven mainly by fiscal policy, which will be less flexible going forward, so this should be at least a small positive for bonds. He expects a moderate rally to about 4.75% in about a month and calls that about right, and says midterm-driven divided government usually brings a decent bond rally over the next couple of months.

  “Fiscal policy is going to be a little less bendy going forward, almost certainly. And that should be at least a small positive for bonds. So to put some numbers behind this, ten year Treasury, 4.75 in a month, that seems about right to me.”at 17:12

US elections & politics

• Tim Seymour · Seymour Asset Management

  Midterms are a bigger market hangover than the oil price, and should work out market-neutral to friendly.

  Investors have been dealing with the midterms as a hangover, and he presumes things will work out in a way that is market neutral to friendly. He sees the oil price as the bigger factor for rates and markets, with the midterms and a possible de-escalation with Iran both affecting it. He says oil prices peaked only a couple of days ago, so they are not out of the woods.

  “I think midterms are a bigger hangover for markets to get through... that things are going to kind of work themselves out in a way that's market neutral to friendly.”at 7:48

• Michael Schumacher

  Markets favor divided government; the president's party usually loses midterms and markets latch onto it.

  His main takeaway from his midterm analysis is that markets like divided government. The president's party usually loses the midterms, and markets price that in. Markets get too caught up in the political moment, so they do not look past the ballots being cast now. This pattern gives a steady, if not perfectly consistent, bond-market rally over the following months, rather than the reliable equity rally seen in midterms over the last fifty years.

  “The big takeaway is the market likes divided government. It's pretty simple. And the president's party usually loses the midterms. We know that. The market latches onto that.”at 16:39

Private credit

• Keri Findley · Tacora Capital Management

  Light SEC consumer enforcement may end in two years, threatening lenders such as home equity investment providers.

  The current SEC and enforcement regime has been light, especially on consumer protection and enforcement actions. That has made it a good time to be a lender or originator over the last few years. She sees a world where that could stop, and the bigger marker is two years out. Home equity investment providers are an example: they started under Trump and built their businesses under Biden with very little regulatory enforcement. She says that in two years they could be headed for a change.

  “I think the bigger kind of marker is two years from now because the current SEC in place, the current enforcement in place has been light... There's a world where that could stop.”at 41:45

• Keri Findley · Tacora Capital Management

  Demand for small private-credit loans stays steady even as mortgage and consumer loan demand falls with rates.

  Her firm does $10 to $50 million loans and is largely insulated from the Fed tightening effect on the broader market. Overall borrowing demand is falling: mortgage originations and consumer loan originations are down, which shows demand has dropped because rates are up. In the small-loan sector where her firm plays, demand has been very consistent.

  “Obviously, mortgage originations down, consumer loan originations down. So we know that demand is down because rates are up... In the small sector where we play, there's been very consistent demand.”at 44:23

AI bubble & tech valuations

• Steve Grasso · Grasso Global Inc.

  Mega-cap capex is not yet producing earnings growth, which is why the market has pulled back.

  About 10 to 15 large companies make up roughly 40% of the market and supplied about half the earnings growth, which is probably now slowing below 30%. Capex is being spent for future earnings growth, but that growth is not there yet or is slowing. That is why the market has pulled back. The companies have given some reassurance, but not the kind the market had in the past.

  “10 of these companies or 15 of these companies basically are 40% of the market and they supplied 50% of the earnings growth. And that earnings growth is probably going below 30% now. So you have capex being invested for future earnings growth and the earnings growth isn't there now or it's slowing.”at 9:58

Middle East & Iran

• Matt Gertken · BCA Research

  An early Iran ceasefire is the most bullish scenario; oil prices, not midterms, drive yields and stocks.

  He thinks the midterm election is overrated for markets. What really drives things is the oil price, which drives bond yields and can pull down equities. So the most bullish outcome is for the president to agree quickly to a ceasefire with Iran. Iran has an incentive to keep oil prices high to sap American will, and the blockade is wearing on its economy. He sees a window of at least three months of possible strikes, and he expects a ceasefire from the survival instincts of both sides, though it will take a while.

  “I think the most bullish scenario is one where the president immediately agrees with Iran to have a ceasefire because I think the midterm election is overrated in terms of its market impact. What is really driving things is still the oil price”at 10:59

US rates & the Fed

• Matt Gertken · BCA Research

  The Fed may have to hike a few more times before inflation is contained.

  The bond market will eventually see the Federal Reserve contain inflation, but they are not there yet. The Fed may have to hike a few more times. If the president has to pressure Iran to reach a more durable ceasefire, that tightening of policy will be unpleasant for markets, although the end game is a business cycle with lower inflation.

  “you will eventually have the Federal Reserve contain inflation, but we're not quite there yet. And the Fed may have to hike a few more times.”at 13:26

US tax & spending policy

• Matt Gertken · BCA Research

  Democratic House control forces bipartisan deals, bringing slight fiscal easing and upside to yields.

  The base case is a Democratic House and Senate, which polling supports and which is driven by gasoline prices. A Democratic majority would force the president to pivot to bipartisan legislation. The president will not allow tax increases, but he will probably ease Medicaid and Medicare spending and maybe the Affordable Care Act. That means slight fiscal easing and some upside for bond yields. If Democrats win only the House and fail in the Senate, that would be bullish, with continuing resolutions and frozen fiscal policy that avoid stoking inflation.

  “But what that means is that you'll have a Democratic majority, and the president will have to pivot to cooperate and produce some bipartisan legislation. And that means there will be a slight fiscal easing.”at 14:55

US stock market outlook

• Steve Grasso · Grasso Global Inc.

  After midterms, returns are muted if markets are already up 5%+ going in: about 10% vs 14-16%.

  Historically, if the market is already up more than 5% going into the midterms, its gain over the following 12 months is about 10%, compared with 14% to 16% otherwise. So the post-midterm effect is muted. Still, the market is up after the midterms in all accounts.

  “if the markets are already up above 5% going into the midterms, the twelve months out, a year out, you're up 10% versus that 14% or 16%. So it's muted.”at 18:39