In this episode of Best Stocks Now, Bill Gunderson shares expert analysis on the current bullish market, the implications of potential Fed rate cuts, and the rise of AI-driven investments. Discover how geopolitical relations, technological advances, and corporate earnings shape the investment strategies of top-tier financial advisors.
He’s been seen on CNBC, the Fox News Channel, and the Fox Business Channel. His articles can be found on MarketWatch, Seeking Alpha, thestreet.com, and many other places. He’s the author of the weekly Best Stocks Now newsletter and the inventor of the Best Stocks Now app. He’s president of Gundersen Capital Management. Here is professional money manager Bill Gundersen.
SPEAKER 01 :
And welcome to the Monday morning. It is September the 15th. It is the live edition of the Best Stocks Now show. Welcome to a new week in the market. Hopefully we get a nice rate cut this week. The markets have started off on an optimistic trend. Note so far, with the NASDAQ right now up about a half a percent, and that is a new all-time high on the NASDAQ. The NASDAQ’s now at 22,260. Those are some very heady numbers. The S&P 500 is hitting a new all-time high also this morning. It’s up 23 points. That’s a third of a percent. It’s at 6,607. And the Dow Jones Industrial Average is up just 13 points, 45,847. Small caps are up 30 basis points. And the bond market, which is awaiting the Wednesday Fed meeting. An announcement. Will it be 25 basis points? Will it be 50 basis points? You’ve got the 10-year right now is at 4.04. It’s down two basis points. Gold is up again. It’s at 3,691. Crude oil is up to 63.27. It’s up 1%. And Bitcoin is down 792 to 114,000. So welcome to today’s Best Stocks Now show with professional money manager Bill Gunderson, president of Gunderson Capital Management, a nationwide fee-based only money management firm. And today we put that statement where we put our money where our mouth is. We will be. Barry’s already in the air headed for the other coast. and I’ll be leaving after my trading day here today for the West Coast, cross-country, and all places in between. We fly over many of the cities that we also broadcast in, but we’ll be in the Bay Area all week in the Santa Clara. Santa Clara, the center of it all, pretty much, for AI, semiconductors, software, cybersecurity. I can’t wait. Dungeness Crab Cocktails, let’s not forget that. I can’t wait to get out there and spend the week there. Looking forward to meeting the folks. And, you know, you’ve got the market hitting new all-time highs right now. What will I talk about at the workshop tomorrow at 7 p.m.? ? At the Santa Clara Marriott, well, you know, it just depends. We don’t know what’s going to happen between now and then. I look at the stock market as it’s live. It’s live and it’s changing every single day. And there’s news dropping every single day. There’s interest rates changing. There’s inflation reports. There’s market valuations changing. There are new technologies coming along. There’s mergers. There’s acquisitions. There’s IPOs. But, you know, a lot of times I go back to the foundation, the foundation of my own investment strategy, which is not 60-40 asset allocation. And that’s the predominant strategy at most of the big firms now across the nation. I still like to use individual stocks. I’m not a big fan of exchange-traded funds. I don’t like getting 35 bad semiconductor stocks along with my three or four good ones. That’s just me. I do things a little bit differently. and I do it happily. That’s what I get up for every morning is the thrill of the chase, the thrill of finding superior investments in the market and not just being satisfied with a passive asset allocation, which is basically based on your age. Okay, so we have a good start here to the market today. I would say that the market is optimistic. I think by now we might be a little disappointed with the 25-point rate cut. Why? Why didn’t we get 50? Does anybody, do I hear 75? And I think there is an argument to be made, very much so, for a 50 basis point cut. What is it the Fed has been saying? What have we been looking for? We’ve been looking for softness in the labor markets. And I think you’ve had that in spades here the last several initial jobless claims reports. the last several monthly non-farm payroll reports, and the massive revisions downwards to the entire year 2024. I mean, what more do you need to show that the labor market is not as strong as we thought it was? To me, that warrants a 50 basis point rate cut. I don’t think we’ll get it, but I think that’s what it should be. And, of course, President Trump, He expects a big cut. Well, you know, I mean, that’s President Trump. He says he’s expecting a big cut from the Federal Reserve on Wednesday. I don’t think he’ll be happy with 25 basis points as the central bank’s governors are widely forecasted to slash the rates after holding them steady for nine months. And I think another piece of evidence factoid that I would throw out there is that the ECB is at 2% with their interest rates from the European Central Bank. We’re double that. We’re at 4%. So I do think that the Fed is very much behind the curve. The odds, the percentage that the Fed will cut by 25 basis points are 94.2%. I think that the 50 basis point cut is somewhere in the, you know, maybe 10, 15% range possibility of that happening. I think the market would be very happy with 50 basis points, but I think it’s a big long shot that we get that. Meanwhile, the search goes on for several things. You know, I’ve been following the Charlie Kirk story, obviously. I am a big fan of talk radio. I listen to many talk show hosts. I try to gather as much information as I can from all different viewpoints, whether it be global, whether it be state, whether it be from the right, whether it be from the left to help me make decisions. And I don’t know who’s going to be taking over Charlie Kirk’s spot, but I do know, here’s a little tip for you, I know who’s hosting his show today, none other than J.D. Vance. J.D. Vance will be doing two hours of Charlie’s show today. I hear through the grapevine that Scott Jennings is the most likely fill-in for Charlie in his three-hour slot here on Salem Radio, but we’ll just have to see how things play out. I know that his TPUSA movement is not finished yet, I think his wife, his widow, threw a little bit of gasoline on the fire there. So it will be interesting to see how that works out. And there’s also a search on for a replacement for Jerome Powell, who seems to be a lame duck. Or is it a lame hawk? BlackRock exec Rick Reeder rises in contender rankings for the Fed chair. Scott Besson is the one that’s out there interviewing for the replacement for Jerome Powell. You may not like BlackRock, the name BlackRock. Rick Reeder oversees asset management giant BlackRock’s fixed income business. He’s climbing in the list of potential successors to Jerome Powell. I think they’re going to pick the biggest dove myself. So far, Besant has sat down with four of the 11 publicly identified contenders for the Fed chair role today. And the roster is expected to grow by another one or two names, the administration official has said. And I also know that there’s some talks going on today in Madrid. Why Madrid? Well, it’s a neutral place for China to be getting together trade representatives from China, getting together with trade representatives from the U.S., You know, even though we do have a trade agreement in place, it’s very much a moving target. It’s very contentious. And there could be changes. Things could get better for China. Things could get worse for China. It just depends. But there are talks going on today. And there is optimism. That’s also part of the optimism that is built into the market here today. so far this morning that we can hash things out with China. But, you know, I’ll tell you, the sticking point there is China’s cooperation with Russia. That’s a huge sticking point. A very big sticking point is China continues to buy Russian oil, as does the EU. The EU, which makes absolutely no sense to me that the EU is buying Russian oil. And China is buying Russian debt, Russian bonds. And, of course, that is going towards funding the war against Ukraine. So that’s the big picture. That’s the global backdrop. There’s a little bit more on that when we come back. And then we start drilling down right to the individual stocks as we go throughout the show. This is Bill Gunnarsson. It’s the Best Stocks Now show. And welcome back here to the second quarter of today’s Best Docs Now show. And I will be California bound. You know, I’m just thinking how times have changed. Well, I’ve been in the business. And, you know, I mean, now I can travel almost anywhere. I can do my radio show from almost anywhere. That’s all I need is the Internet. I can look at stock charts almost anywhere. That’s all I need is my laptop and a good Internet connection. It’s a good world we live in. In some ways, it’s gotten a lot worse. In some ways, it’s gotten a lot better. But definitely the technological advances… have been something to behold over the last couple of decades. Well, you know, as I said, one of the sticking points with China is them doing business with Russia, and Trump has to push the NATO nations to stop buying Russian oil. And he’s going to impose tariffs on them and on China if they don’t. So anyways, he wants to impose some big tariffs on Putin, but he wants Europe to step to the plate first. We’ve watched that very closely. Because it does impact the price of oil. It does impact a lot of different things, currencies, etc. China’s industrial output and retail sales miss expectations in August. Jobless rate ticks up. But I have to say this about the Chinese market. The Chinese market has been on fire here recently. With all the fervor for AI exposure, And you look at how much you have to pay for a Palantir or how much you have to pay for an NVIDIA or how much you have to pay for one of the other NBIS or whatever the case may be. They’re trading at some pretty stiff multiples. And then you look at Chinese stocks that also have a lot of AI exposure. Alibaba has got a P.E. ratio of 17, and it’s breaking out to a new 52-week high today. NetEase has a P.E. ratio of 19, and it’s breaking out to a new high today. Tencent Holdings is trading at a forward P.E. of 18, 19, 20. It’s trading at 20 times forward earnings. And it’s breaking out to a new high today. So I got to say that despite the issues that China’s having and the rift between us and them and the trade issues, etc., which, of course, they’re talking about in Madrid, Spain today. The Chinese market is having a pretty good year here in 2025. Trump likely to extend TikTok deadline. Well, you know, supposedly there is a buyer. There is a deal to that to be had here. We’ll see whether or not that happens. Will TikTok become a public company? Will it become a part of Oracle? We just don’t know at this point. In my newsletter over the weekend, I did write an article about Oracle. I called it the Oracle of Austin of all places. Not the Oracle of Omaha. That’s Warren Buffett, of course. But we’ve got the richest man in the world. Or he was. Have you seen the movement in Tesla here? Elon Musk has been gobbling up his own stock. He put a billion dollars of his own money into it. What’s a billion when you’re worth $640 or whatever it is? $340 billion. $340 billion. I think he’s back on top as the world’s richest man. But anyways, there supposedly is a deal for TikTok. We’ll see how that plays out. And Trump is calling for a push to do away with quarterly earnings reports. I don’t know. That is so ingrained in the Wall Street and companies. You know, these companies, we’ve got to make our quarter. We’ve got to make our quarter. And I almost think that every 90 days is a good idea to stop, collect yourself, take a breather, assess where you’re at. I kind of like the quarterly thing. I mean, we didn’t get report. We got report cards pretty regularly when I was growing up. I’m not for making it two times a year, but Trump is pushing for that so companies don’t have to worry so much about making their quarter. which sometimes can lead to bad things. You know, in between the lines last week, Argentina was down 12%. And, of course, that’s Javier Mille, who, you know, famously was on stage with Elon Musk, the Hacksaw twins, or the… Not hacksaw, the chainsaw twins taking a chainsaw out of government spending. But his party suffered a heavy loss in some local elections last week. And I did notice as I did my weekly scoreboard in the markets that Argentina had a horrible week. It was down 13%. Right now the S&P 500 is up about 12% for the year. We’re going to enter the final quarter of the year here in a couple of weeks. The Dow is up just 7.7%. I call it the soggy Dow. S&P up 12%, the Dow up 7.7%, but the NASDAQ has the best return of all, and it has over the last 10 years by a long shot. The NASDAQ is now up 14.7% year-to-date. Small caps have grossly underperformed the rest of the market this year. The S&P 600 is up only 2.4%. The Russell 2000 is up 7.9%. There’s one school of thought that says you should have an allocation that covers all of the asset classes. That’s one school of thought. My school of thought is you should be heavily concentrated in the best performing asset classes at any given time. And that’s a relative thing. It does change. But I have very little exposure to small cap stocks in 2025. I have very little exposure to the oil sector. There’s also sectors in the market that aren’t doing well here this year. and uh you know when uh the s&p 500 i believe is about 10 to energy meaning you should have a 10 exposure to energy i personally don’t buy into that i’m more of a uh oh what would you call it tactical that’s the word i’m looking for i’m more of a tactical allocator uh and you know it just so happens that I’m pretty much a bottoms up guy. And so the stocks that I find, I don’t find many oil stocks right now that are best stocks now. I don’t find many small cap stocks that are best stocks now at the current time. So the app, the Best Stocks Now app is very helpful to me. And the asset allocation that I have at the end of the day is what it is, depending on the relative situation of the market. And a lot of times, these cycles in the market can last for a very, very long time. The emerging markets are up 20% this year. They’ve done very well. China, you can thank a lot for that. China’s up 33% year to date, 33%. Does that mean we shouldn’t have any exposure to China? Well, I do have some exposure to China. which you’ve heard me say in the past, I’m not real enamored with China. But when some of their blue-chip, large-cap stocks with AI exposure are trading at one-third of the valuations that the others, and they have strong momentum also, I don’t see anything wrong with a little bit of China exposure. And last but not least, Europe is up 25%. This is one of the best years I’ve seen for Europe in a long, long time. And I think a lot of that was tariff avoidance, getting out of the U.S. earlier on to avoid the commotion that we had early this year. We’ll be right back. This is Bill Gunderson. Thank you for tuning in to today’s Best Stocks Now, Best Inverse Funds Now show. Now, back to the second half of the show.
SPEAKER 06 :
And welcome back here to the second quarter or the second half of today’s Best Stocks Now show.
SPEAKER 01 :
Just looking at the inside the S&P 500 here right now, it looks like tech. continues to lead the way here. We’ve got Seagate. Man, I’ll tell you what. Seagate was around when I got in the business over 20 years ago, and it’s hitting a new all-time high today. Seagate these days is headquartered in Singapore, of all places, and also Ireland. I believe they did some kind of move there with Ireland for tax reasons, but Seagate is hitting a new all-time high today. It’s up 8%. Obviously, it plays a role in AI, Western Digital too, and I’m looking at Seagate’s last four quarters here. Sales up 49%, 50%, 31%, 30%. Not bad for a company that’s been around for quite some time. And their earnings up 818%, 999%, 476%, and 147%. And this will be one of the topics I’ll be talking about tomorrow at the workshop at 7 p.m. in Santa Clara, is earnings growth. You’ve heard me say it before, and I’ll say it again, that stocks, for the most part, follow earnings. Yes, the multiple comes into play, but a company growing by 25% per year, in my book, is far superior to a company growing by 2% per year, their earnings. There is a correlation between earnings growth and stock price appreciation. Charts… valuations, the economy, a lot of different things come into play but that earnings growth is a key part of the puzzle in my book if you’re going to be a growth investor if you’re an income investor then that’s a whole different ball game but i would also make the argument that a big proportion of your income comes from capital appreciation in fact i was reading today about You know, the capital gains that have been had over the last couple of years, guess who collects those capital gains? The U.S. government and the federal government. The IRS, through the IRS, is going to get a big boost from capital gains taxes being paid in to the government. In fact, it’s going to be one of the best years ever for capital gains receipts. So anyway, Seagate is a big mover here today. The breakout in Tesla is just incredible. It’s not on any news that I can find. It’s not on any huge quarters. In fact, they’ve had four really bad quarters in a row. But Tesla has the it factor. It has the wow factor. It has Elon Musk. He tends to be a great promoter of his stock. And it’s back up to $1.3 trillion. It’s up another 5.3% today on news that he bought a billion dollars worth of his own stock here recently. And Tesla just all of a sudden woke up here three days ago, broke out. Its all-time high is 488. It’s at 417 right now. I just mentioned Seagate Western Digital also having a big day today. It’s hitting a new high. Yes, all-time high. Western Digital, which is headquartered right where we’re headed, it’s in San Jose, California. I knew a lot of people that worked at their Irvine office. I don’t know if they still have that one. But look at Western Digital’s last four quarters. Sales up 80%. Sales up 80%. That’s year over year quarters. Sales up 31%. Sales up 30%. So you’re averaging 30% to 50% sales growth. And the bottom line earnings up 188%, up 242%, up 999%, and up 316%. So they’ve also had some phenomenal current earnings. That’s quarterly growth. They’ve also had some pretty good annual earnings growth along with that, obviously. So that one is a top performer here again today. A few other winners out there. Intel. Intel sold off Altera. is selling off Altira. I remember when Altira traded on its own. It’s a chip design company in the Bay Area. So Intel gets a big influx of cash, obviously, with the sale of Altira to private equity. The other one that pops off the page for me today is Google. Man, I’ll tell you what. We made a very timely buy in Alphabet in our portfolios. It’s not only one of the 18 stocks in our premier growth portfolio, but it’s one of the, oh, I think 25 stocks now in the relative value portfolio. We added it when I thought from a relative value basis it was a good buy. Google’s last four quarters of earnings, plus 15, plus 12, plus 12, plus 14. Not bad. It’s not like Western Digital and Seagate, which tend to be choppy because that is kind of a commodity, your storage. But their earnings growth has been even better than that over the last four quarters. Alphabet up 28%, 32%, 26%, and 24% sequentially. Over the last four quarters, it’s hitting a new all-time high today, and it’s crossing the $3 trillion mark. Not many companies, that enters into some pretty rare company there. For me, that’s the stock of the day is Google Alphabet, and it happens to be one of our largest holdings. Think of the irons in the fire that Alphabet has, okay? Waymo, obviously. The search engine, the advertising, the A.I., Google Chrome, it goes on and on and on. And that’s a beautiful, huge move there in Google Alphabet today. Okay, other news out there. We’re starting to get into some individual companies here. Arista Networks. Now, Arista had an investor day on Friday. Arista has been the number one ranked stock in my app. Out of 5,200 for quite some time. Arista headquartered in Santa Clara. Once again, ground zero. I’ll be there tonight. Barry will be there earlier than that. The whole team is headed to Santa Clara this week. Arista, I thought they gave a good guidance, really good guidance, but I read between the lines and it was the margins that had everybody upset. But at the end of the day, the margin difference was very minor. I thought it was overdone. The sell-off on Friday, I think it was down 9%. Well, guess what? Arista’s rebounding today. Probably a good buying opportunity. It’s up 2.7% this morning. after their analyst day on Friday and the sell-off that Arista had. I mean, Arista is right in the middle of data center, AI, probably the number one networking company. At one time, Cisco held that crown. But in my book, these days, ANET has been one of our largest holdings for quite some time, and it’s been very good to us. COVID vaccine makers take a hit after report of child deaths in CDC presentation. Well, that controversy doesn’t go away. The vaccines, which there’s also going to be a very extensive study done to see if there’s any link between the vaccines and autism. And, you know, the Tylenol rumors are still out there. I know that RFK met with the CEO of Kenview, which was spun off from Johnson & Johnson, a big maker of Tylenol. But the CDC is putting out a paper, supposedly, that links 25 deaths in children to the vaccine okay so the uh… the uh… controversy there uh… continues uh… with tylenol with uh… the vaccines etc man i’ll tell you what the ipo market has been red hot i know Because I have to add them to the app, and it’s been extra busy here recently. You know, that’s a good sign. It’s a good sign that IPOs are happening, that they’re coming public while things are good. The merger and acquisition market, I know, is very brisk right now. The appetite for IPOs continues to grow. StubHub is next. But this year, we’ve seen CoreWeave, we’ve seen Circle, we’ve seen Figma, we’ve seen Klarna, we saw Gemini on Friday, which opened up, I think, 45% over its listing price. So anyways, some pretty good stuff happening in the IPO market. And I wish them all luck in the Best Stocks Now app ranking system. It takes about maybe three or four weeks before they start to get a rank. But good luck to all the new entrants there. When we come back, we’re going to talk nuclear, the golden age of nuclear. We’ll be right back.
SPEAKER 05 :
Thank you. Thank you.
SPEAKER 01 :
And welcome back here to the final segment of today’s Best Stocks Now show. The nuclear sector continues to be very much an investable sector. You know, look, utilities, okay, utilities have always been a part of the S&P 500, et cetera, and a lot of people are utility investors. Well, I just prefer the utilities that have exposure to nuclear. The UK and US are set to announce significant agreements on technology and civil nuclear energy during President Donald Trump’s state visit to the UK this week. So that’s where Trump is headed this week while our trade representatives will be in Spain. The potential agreements highlight U.S.-U.K. collaboration on technology, energy security, and economic growth with ambitions to create a golden age of nuclear. And of course, you know, Rolls-Royce is a U.K. company. They’re opening up a little, I don’t know what kind of, what they’re going to be building there, but right here in Aiken, South Carolina, which is pretty much a rural area of South Carolina, not too far from where the Masters is played every year in Augusta, Georgia. And we’re going to work on advanced innovation in defense, security, and AI-powered data centers. So I do believe in this golden age of nuclear, and we’re seeing it show up in the stocks. And I’ve mentioned the big players, and there’s a lot of ancillary players down the line. There’s new fuels being developed. There are smaller modular reactors being developed. And then there’s your big players, the GEs of the world with GE, Vernova, et cetera. And I think it continues to be a very lucrative area of the market and a growth area. And surprisingly enough, the clamor for more nuclear, I want more nuclear now, came from New York’s Governor Kathy Hochul last week, of all places. So she’s not clamoring for more wind. She’s clamoring for more nuclear. And I do believe, again, that that’s a very favorable area to be invested in in a growth portfolio. Okay, what else do we have? Palo Alto Network’s in focus as Wedbush adds it to their best idea list. Well, they’ve liked Palo Alto for a long time. They’re also very bullish on Tesla, obviously. They like Elon Musk. Anheuser-Busch trying to get into the energy drink market. Yeah, that would be interesting. You know, that’s a pretty crowded space. But if you’re at your local convenience store, I talked to a kid yesterday. He is a salesman, sales rep for Monster Energy. And he says that pretty much it’s convenience stores. That’s all that he visits are convenience stores. And he obviously is up against all the others out there. And I got a good rundown from him on the energy drink market. initiative that’s out there and the competition and whatnot but I didn’t know that Budweiser let’s see there’s a lot of form first form let’s see I think that’s the name of it yeah first first form p-h-o-r-m is a collaboration between UFC president Dana White that’s you know the fighting And Form Energy, P-H-O-R-M, will be a Budweiser product. Are we in an AI bubble? Well, you know, one of the big AI guys says that we are in. An AI tech bubble, but it’s manageable. It’s not as bad as the one we had back in 2000. And if you want to see my thoughts on that, I wrote an article two weeks ago comparing. I was there in the year 2000 managing money when the NASDAQ crashed. It was the dot-com bubble. And that’s when the NASDAQ lost 79% of its value. It was good to have lived through that. It was good to have witnessed that. It was good to find out that valuations do matter. That stocks just don’t go to any old price to sales, price to cash flow, price to book, price to PE, price to forward earnings valuations. That valuations do matter. And I’m constantly comparing today’s valuations with the valuations of the year 2000. But it’s also quite a bit different. I mean, the quality of the earnings now, pretty phenomenal when you look at the earnings growth of the NVIDIAs, of the Palantirs, of the CrowdStrikes. And, of course, even these Seagate and Western Digital and all the rest, the quality of earnings. It’s pretty incredible, really. And yes, we are in an AI bit of a bubble here. But at the same time, right now, the AI bubble continues. Today, you’ve got the NASDAQ hitting a new all-time high. It’s above 22,000 now. And how do I manage stocks that are very, very pricey and heady? Well, you know what? I watch the technical charts. I employ all. I employ fundamental research. I employ valuation. I employ momentum, relative strength types of criteria. And then visual. That’s the last one is visual. When some of these high flyers, momentum can go both ways. We have to be very careful to watch for momentum changes. Having said that, I’ve had the same stocks for quite some time. I believe in owning the best stocks in the market today. unless something else comes along better or unless the story changes or the momentum starts to drain from a stock there’s a lot of different factors that create you know selling types of situations okay what else do we have we’re out of time Well, I will be broadcasting tomorrow and the rest of the week from the heart of it all, the Silicon Valley, Santa Clara. I’ll be reporting. I’m sure I’ll be meeting with a lot of tech folks over the next several days. I’ll give you a rundown of the workshop that I teach tomorrow night at 7 p.m. It is open to all. You have to have a reservation. 7 p.m. at the Santa Clara Marriott, 855-611-BEST. If you want to meet with us while we’re there, it’s a rare opportunity. You can call Edie at 855-611-BEST, 855-611-BEST. And, of course, if you’d like to just try out our four-week trial, the newsletter, the live trades, the access to the powerful Best Docs Now app, GundersonCapital.com. GundersonCapital.com. Have a great day, everybody.
SPEAKER 03 :
This show is not a solicitation to buy or sell any securities. Bill Gunderson or clients of Gunderson Capital Management may have long or short positions in stocks mentioned during the show. Past performance is not indicative of future performance. Gunderson Capital Management is a fee-based registered investment advisory firm. All accounts are held at Charles Schwab. Schwab is a member of SIPC and FINRA.
