Cracks in the AI Trade, Tech Earnings Preview, Surging Airfares 10/20/26

Amazon.com

Across the shows: 9 speakers in other episodes, 5 bullish and 3 bearish calls, past 30 days

• Chris Grisanti · MAI Capital ManagementBullish

  Amazon trades at its cheapest valuation ever while earnings growth accelerates, making it a terrific risk-reward.

  Grisanti, a value investor, favors the hyperscalers for their risk-reward and least downside rather than their best appreciation. He argues Amazon is selling more cheaply than at any point in its history. He expects earnings to rise by more than the market thinks, and says earnings growth is accelerating. Cheap valuation plus accelerating earnings makes Amazon a terrific risk-reward, which he calls the place to be at reasonable valuations.

  “they are selling more cheaply than in Amazon's case ever,”at 5:18

Microsoft

Across the shows: 5 speakers in other episodes, 4 bullish and 0 bearish calls, past 30 days

• Chris Grisanti · MAI Capital ManagementBullish

  Microsoft trades well below its average valuation, offering terrific risk-reward alongside accelerating earnings.

  Grisanti prefers the hyperscalers because they offer the best risk-reward in a market where exciting names are expensive. He says Microsoft's valuation is way below its average, and that earnings are going to increase by more than expected, with accelerating growth. He pairs Microsoft with Amazon as the two names that represent terrific risk-reward.

  “and Microsoft's case way below its average valuation.”at 5:26

General Motors Company

• Chris Grisanti · MAI Capital ManagementBullish

  GM is a cheap, shrinking company at six times earnings, with big buybacks supporting the stock.

  GM's shares fell about 6-8% because it did not raise guidance despite strong quarters. Grisanti points to a $20 billion buyback, which he compares to NVIDIA announcing a $2 trillion repurchase, buying back about a third of the company. He says the company has already bought back about 40% of itself. Earnings are solid rather than magnificent, and he loves the investment at six times earnings.

  “This is a disappearing company. The earnings are solid. They're not magnificent, but they're solid. I love the investment at six times earnings.”at 12:10

International Business Machines

• Chris Brigatti · SWBCBullish

  IBM benefits from diversified enterprise software and services revenue, a better AI-adjacent play than chip designers.

  Brigatti screens for companies with diversified revenue streams that are not one-trick ponies. IBM is focused on software but also has an AI play, so its revenue is not solely tied to AI. It focuses on enterprise solutions rather than fickle consumer and client trade. He contrasts it with chip designers, which face very high capex and rely on a narrow revenue path. IBM generates revenue around the edges of AI infrastructure by building technologies that help information move, and he says companies like it can benefit in the long run.

  “a really good example is IBM. I mean, IBM is like very focused on its software component, but it does have the AI play as well.”at 23:45

IonQ

• Sylvia Jablonski · Defiance ETFsBullish

  IonQ is a call option on commercial quantum computing, with revenue tripling and a ten-year hold thesis.

  Jablonski calls quantum the fourth industrial revolution and says it is becoming commercial. IonQ has roughly tripled revenue in the last year. It has commercial projects with AstraZeneca and Nvidia that improved a chemistry experiment's timing about 20 times, a trucking company optimising driverless vehicles, and Airbus cargo loading. The company projects about $490 million in revenue next year. The stock has been beaten down by its AI cousins, and it reports pre-earnings. Her Quantum ETF pairs IonQ as the call option alongside ballast from Google, Nvidia and IBM. She sees this as the ChatGPT moment for quantum and says people should hold for ten years.

  “But I like it because it's a call option on quantum computing.”at 26:15

Norwegian Cruise Line Holdings

• Contessa Brewer · CNBCBullish

  Norwegian's luxury lines show strong demand, with bookings up 20%, even as the parent stock lags.

  Brewer presents luxury cruising as a segment where affluent customers keep spending. Norwegian's stock is down almost 30% year to date, but its luxury brands Regent and Oceania are seeing bookings up 20% year over year. She ties this to Norwegian's $15,000-a-night suite and a $25,000 suite coming in December, and to rivals such as Royal Caribbean's Silversea, Ritz-Carlton, Aman, Four Seasons and Orient Express all targeting the same customers. She describes luxury and expedition as the fastest-growing cruise segments, so she sees the luxury business as a strength that the stock price does not yet reflect.

  “Regent is owned by Norwegian, and its stock... Well, it's having a pretty good day today, up 3%, struggling this year down almost 30% year to date. The luxury lines that it owns, Regent and Oceania, are seeing bookings though up 20% year over year.”at 41:54

Airlines & aviation

• Michael O'Leary · Ryanair

  European airfares will rise 10-20% next year, the biggest jump in history, as jet fuel costs bite.

  O'Leary predicts European airfares will rise by 10, 15 or maybe 20% next year. He says it will be the biggest increase in airfares in European history over the next twelve months. The reasoning given is that airlines have little protection from higher jet fuel costs. US fares are already surging, with the Hopper data showing Thanksgiving round trips 31% higher and Christmas 23% higher, which suggests the trend is underway.

  “You're going to see airfares rise next year in Europe, I think, by 10, 15, maybe 20%.”at 32:06

• Chris Sununu · Airlines for America

  US airfares are rising 20-30% into the holidays as jet fuel costs surge and airlines pass them on.

  Sununu says jet fuel is up about 250%, more than doubling, and fuel is most of the cost of flying a plane. Airlines are absorbing most of that cost and will lose $12 billion this year. Some of it has to be passed to customers, which is why fares rise 20-30% into the holidays. He argues Europe is far more sensitive to oil and Hormuz disruptions, so its fares are up 30-40% already and may rise another 15% next year. He thinks the US is less susceptible because it refines much of its own oil, and the US likely won't see that second jump.

  “So jet fuel is far more than doubled. The vast majority of the cost of... putting a plane in the air is jet fuel. Now the airlines themselves are eating most of that cost.”at 33:09

• Chris Sununu · Airlines for America

  US airfares stayed flat since 2019 because credit card points programs keep flights cheap for middle-income travelers.

  Sununu argues that airfares have been flat from 2019 into early 2026, before the Iran crisis, and did not even keep pace with inflation. He attributes this to credit card points programs, which he says let lower and middle-income Americans fly far more often, so demand for cheap seats stays high. He presents this as a reason to think airfares are not rising the way the market or critics assume.

  “Prices didn't budge at all. They did not even move with inflation. They stayed absolutely flat because so many folks are taking advantage of the credit card program.”at 37:21

AI infrastructure & data centers

• Sylvia Jablonski · Defiance ETFs

  AI infrastructure demand is not going away, so financing worries should fade if hyperscaler earnings deliver.

  Jablonski expects strong AI-related earnings this season from hyperscalers, Micron and Nvidia. She argues that if that happens, investors will worry less about funding, financing and credit for AI buildout. Her reason is that demand for AI infrastructure is not going away, which she calls the biggest thing. She also cites backlogs at companies like Vertiv that they will grow into. She hopes these expectations come to pass.

  “And if that comes to fruition, I think investors will be less worried about... funding and the financing and the credit that is out there for this because, again, you will see that the demand is not going away.”at 6:35

• Chris Grisanti · MAI Capital Management

  AI capex keeps rising into 2027, but a future capex turnover is when to avoid these stocks.

  Grisanti says this is the biggest capital spending boom ever, so investors should examine balance sheets and work out future winners and losers. He prefers the hyperscalers because they can fund their own growth. He argues that 2027 capex will be higher than 2026, and companies have signalled 2027 into 2028. The danger point is when capex turns over and falls year over year, which is when investors should not own these stocks. He says that is not five years away.

  “Well, Brian, I hope that I'm here when capital spending turns over, and one year, it's gonna be less than the year before, and that's gonna be the time where you don't wanna own these stocks.”at 9:12

Power demand & the grid

• Sylvia Jablonski · Defiance ETFs

  Data-center and AI power demand over the next year or two is so large it equals about 20 New York cities.

  Jablonski argues that the AI power and infrastructure trade is attractive because demand is huge. She says the power needed for data centers and AI infrastructure over the next year or two equals about 20 New York cities. That demand backs the power trade as a whole.

  “[We] need 20 New York cities to power the amount of demand that we have for the next year or two for data centers”at 10:55

• Chris Grisanti · MAI Capital Management

  The power trade for AI will outlast the picks-and-shovels trade, given a five-to-ten-year buildout.

  Grisanti argues that power demand for data centers and AI infrastructure will last longer than the chip-and-hardware trade. His reason is that it is a five-to-ten-year build-out. He sees the power trade as the longer-lasting part of the AI infrastructure boom.

  “the power trade is gonna last longer than the picks and shovels AI... Because it's a five to ten year build out.”at 11:00

Oil & fuels

• David Weck · Vortexa

  A surge of seaborne oil supply should soon hit markets and ease the tight oil situation.

  Weck says seaborne oil lifted has increased by about 9 million barrels per day over the last two months. That is roughly the oil demand growth of six typical years in the last decade. The supply has not yet reached markets, which is why inventories have fallen to very low levels. He says these barrels will start to hit markets very soon, and they already are. India's crude inventories are strongly up, many barrels will arrive in China soon, and diesel and LPG exports from the US have recovered. Winter is a less demanding season, so product markets should ease too.

  “I'm actually thinking that there is a good chance that the situation may ease somewhat.”at 18:27

• Chris Sununu · Airlines for America

  Europe must build its own refining capacity, since import reliance leaves it exposed to fuel shocks.

  Sununu agrees with Sullivan that Europe's fuel problem is self-inflicted. He says Ryanair's O'Leary warned Europe ten to fifteen years ago that it needed its own refinery capacity for oil, diesel, jet fuel and gasoline. Fuel prices in Europe have long been 50-100% above the US. He says it is never too late, but planning must run twenty, thirty or forty years ahead, and Europe should develop its refining infrastructure now.

  “they had to develop their own infrastructure, their own refinery capacity so that not not just they had oil, but they had the diesel, they had the jet fuel, they had the gasoline.”at 35:17

AI: overall outlook

• Sylvia Jablonski · Defiance ETFs

  Tech and AI top names are poised to keep growing into year-end despite inflation and geopolitical risks.

  Jablonski says the seasonal backdrop is strong and that tech, AI and many of the top names she follows are poised to keep growing through the end of the year. She admits there is a backdrop of inflation fears, geopolitics and possibly credit risk. She offsets those with the point that demand for power, energy and AI compute is not falling, even though some stocks have dropped.

  “I think that tech and AI and a lot of the top names that we've been looking at are poised to continue to grow into the end of the year.”at 3:43

US stock market outlook

• Sylvia Jablonski · Defiance ETFs

  Fundamentals look good with a strong consumer and great earnings, so markets should climb despite inflation and oil risks.

  Jablonski acknowledges risks: inflation has to be got past, and oil prices will eventually stress the economy and markets. For now she sees good fundamentals. The consumer is strong, and last quarter's earnings were great, with about 79% of companies beating so far. Expectations are high, but she expects the market to climb the wall as earnings come in, which should dispel worries.

  “we do have to get past inflation... But for now, the fundamentals are looking good. The consumer is looking strong. Earnings were great last quarter.”at 5:39

Shipping, trucking & logistics

• David Weck · Vortexa

  Tanker freight has jumped from $2-3 to $20-30 a barrel, lifting delivered crude costs and inflation.

  Weck says shipping a barrel of crude from the US to Europe or from the Middle East to Asia historically cost about $2-3. It now costs roughly $20-30 per barrel, a completely different level. He says the very tight freight market is driving up delivered oil costs and contributing to inflation. He is skeptical that relaxing sanctions on old shadow-fleet supertankers will bring down costs much. Market players are not relying on such waivers, given how often policies change, and nobody picked up the earlier Iranian export waiver outside China.

  “Historically, shipping a barrel of crude from The US to Europe or even from The Middle East to Asia very roughly was $2 to $3 per barrel. Now we're talking about [$20 to $30] dollars per barrel.”at 17:44