Power Lunch 10/12/26

Robinhood Markets

Across the shows: 2 speakers in other episodes, 2 bullish and 0 bearish calls, past 30 days

• Adam Frisch · Evercore ISIBullish

  Robinhood is a diversified consumer-finance growth story; Outperform with $130 target on durable net deposit growth.

  Frisch initiates at Outperform with a $130 target, about 20% upside. He calls Robinhood a diversified consumer-finance play with many growth engines, including trading, wealth products, international expansion in 3 to 5 years, and possibly crypto over time. Net deposits are the key metric, and he expects 15 to 20% growth over the next several years, correlated with revenue growth. The customer base is near 30 million, with a 36 average age, 63% earning over $100,000, balances up 4x and crypto transfers up 2x. Over the past year the stock was a leveraged bet on crypto and speculation, but the two prior years were independent of that.

  “You have net deposits growing really well, should sustain in the 15 to 20% range over the next several years.”at 26:58

Ford Motor Company

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

• Mark Fields · TPGUncertain

  Ford's new EV platform will face a real test on cost against Chinese rivals; the outcome is unclear.

  Ford is introducing an all-new EV platform next year. Fields says the market will see how Ford competes on cost with the Chinese, based on landed cost comparisons. He argues Ford and GM must scrutinise every inch of their supply chain and cost base and may need to dial back some features and functions that have gotten out of hand. He does not predict the result, so the view is that Ford's cost competitiveness is still uncertain.

  “And in the case of Ford, for example, they're introducing an all new EV platform beginning in next year. We'll see how they compete cost wise with the Chinese.”at 42:01

LVMH Moët Hennessy Louis Vuitton

Across the shows: 2 speakers in other episodes, 1 bullish and 5 bearish calls, past 30 days

• Robert Frank · CNBCUncertain

  LVMH's China weakness is a single-brand, single-country problem that may stabilise after the Louis Vuitton boycott fades.

  LVMH's third-quarter sales grew 1%, but fashion and leather goods, the key metric, fell 5%, well below expectations. Analysts tie the drop to a Chinese consumer boycott of Louis Vuitton after a legal fight with a tea chain that used a similar logo. Elsewhere the company held up: watches and jewellery were strong, wine and spirits rose 6%, Sephora was up 8%, and the US grew 4%. Frank calls the problem weakness in one brand in one country for a group with 75 brands. He hopes things stabilise once the boycott fades and the fourth quarter improves, and that wealthy buyers in the US will offset weak China demand. He treats the outlook as uncertain.

  “this is really weakness in one brand in one country for a company with 75 brands... Now it's an important brand, an important country, but the hope here will be things will re-stabilize once this whole boycott thing in China shakes out.”at 44:47

US stock market outlook

• Liz Ann Sonders · Charles Schwab

  Index hides deep average-member drawdowns; rotation could ease excesses without a sharp index fall.

  Sonders says the cap-weighted S&P 500 did not have a 10% correction this year, but its average member had a 26% drawdown and the Nasdaq's average member a 46% drawdown. She argues this underlying story means rotation and churn can continue. That churn could ease excesses in sentiment and valuation without the index falling by a large amount in one move. Earlier in 2026, the Magnificent Seven pulled back while other stocks rose, so the index held.

  “The S and P at the index level didn't even have a 10% correction... But the average member within the S and P, has had a 26% drawdown. And it's more extreme for Nasdaq. The Nasdaq's average member has had a 46% drawdown.”at 16:11

• Liz Ann Sonders · Charles Schwab

  Two stocks drive a third of S&P 2026 earnings growth, so a capex miss would hit forward earnings.

  Sonders cites expected 2026 S&P earnings growth of about 35%, of which Nvidia and Micron account for roughly one third. The top 10 earners account for about two thirds of expected growth. That concentration matters more than index-weight concentration. She asks what happens if there is a miss or a downgrade in capex expectations, since that would feed through to forward earnings, the denominator in the valuation equation. Sullivan agrees that the market's breadth problem is a real risk.

  “two stocks account for one third of that. And that's Nvidia and Micron at [18% and 14%] respectively.”at 19:12

Oil & fuels

• Helima Croft · RBC Capital Markets

  Physical barrel costs far exceed screen prices due to freight, insurance and Hormuz risk; the market is complacent.

  Croft argues the paper contract understates what refiners actually pay for a barrel. She cites a transportation crisis: the shortage has moved to ships and crews, and some ship captains are commanding $100,000 a month to transit Hormuz. Insurance costs and US military escort resources add further cost. The Strait of Hormuz is 'far from stable' and not open for business, and she says the market has been complacent in treating moving barrels as proof of normal flows. Brian Sullivan's cited charter rates (about $38 a barrel added on the Houston to South Korea route) support her point.

  “We're in a transportation crisis. The shortage is really now coming to ships, coming to crews that will move this product to refineries.”at 4:40

Middle East & Iran

• Helima Croft · RBC Capital Markets

  Nontrivial risk of major US escalation against Iran after the midterms, beyond the current conflict.

  Croft links the risk to the large US military buildup in the Gulf and to 'powerful voices' who say the Iranian regime cannot be left in place. She sees three possible off-ramps: post-midterm escalation to change the regime, letting the blockade work, or a diplomatic deal. She judges a significant escalation after the midterms to be non-trivial. She also argues the Houthi attacks depend on Iranian money and weapons, so Iran's offer to mediate is like 'the arsonist offering to put out the fire.' Civilian infrastructure targeting, including Riyadh's terminal and Kuwait's power and desalination plants, is a worrying sign.

  “there is a nontrivial risk post midterm that we have some type of significant escalation targeting Iran beyond what we've seen so far.”at 8:51

US growth & recession risk

• Peter Boockvar · OnePoint BFG Wealth Partners

  AI spending and AI stock wealth now drive the US economy, which in turn feeds back into the stock market.

  Boockvar says AI is driving the economy, which drives the stock market, which in turn drives the economy again. His evidence is Delta's comments that its high-end customer is driving its business, and that customer owns a lot of AI stocks. The wealth effect from AI names is supporting consumer spending at the top of the income scale.

  “We know that AI is driving the economy. That is also driving the stock market, which in turn is driving the economy as well. One of the interesting things was Delta talking about their high end customer that is driving their business.”at 17:35

US–China AI & chip race

• Peter Boockvar · OnePoint BFG Wealth Partners

  The key risk to OpenAI and Anthropic is Chinese competition; Micron fell on CXMT's new product.

  Boockvar says investors should watch the threat of Chinese competition to OpenAI and Anthropic. He points to Micron's 3% drop on the day as evidence, since investors worry about CXMT and a new product it is launching. He treats China's progress as the main threat to the US frontier labs' position, which matters for the planned Anthropic IPO and the wider AI trade.

  “The key that I think people should be paying attention to is what is the threat of China competition to OpenAI and Anthropic.”at 18:24

AI bubble & tech valuations

• Peter Boockvar · OnePoint BFG Wealth Partners

  Tech's gains are not sustainable because AI winners depend on broad economic cash flow to buy their products.

  Boockvar argues that everyone breathes the same economic air. The AI winners sell products, such as models and agents, but those products need everyone else to have a healthy business and cash flow to buy them. Tech is doing great, but he does not think that is sustainable. He also notes a 10% correction is normal in most years, and if one comes this time it will likely be tech-driven. The question is whether laggards catch up, winners fall back, or winners keep rising until they don't.

  “The winners right now are producing a product, AI models, agents, whatever. Well, you need everyone else to buy it. You need everyone else to have a healthy business... And cash flow that are gonna buy the products that come out of technology.”at 22:16

Autos & EVs

• Mark Fields · TPG

  Chinese EVs cost about 35% less than European makers', forcing European automakers into restructuring and a shift to differentiated products.

  Chinese manufacturers can produce an EV across Europe for about 35% less than any European manufacturer, and they are also moving fast in the UK, where one in four vehicles sold last month was a Chinese brand. That cost gap is why European automakers are restructuring, with Volkswagen cutting costs as the prime example. Fields argues European OEMs will not beat Chinese rivals on cost, development speed or battery and EV supply chains. Their edge is that they understand their home consumers, so they can win by building products and features people want and will pay for. He describes the picture as a mixed bag for European carmakers.

  “The Chinese produce it for about 35% less than any European manufacturer.”at 40:20

Tariffs & trade policy

• Mark Fields · TPG

  EU limits on Chinese vehicle imports and US tariffs only buy automakers time to adjust.

  The latest European understanding to restrict the number of vehicles coming in from China is not yet a formal trade agreement. In the US, very high tariffs already apply. Fields argues these measures are about buying time, not a lasting fix. Automakers still have to cut costs and compete on landed cost and features against Chinese vehicles once the protection runs out.

  “...we have very, very high tariffs. This is about buying time.”at 41:46