Join Bill Gundersen as he provides a comprehensive analysis of the current market landscape, delving into the highs and lows of key indices. The episode kicks off with a detailed overview of recent market performances, highlighting the NASDAQ’s record highs and contrasting it with the sluggishness of the Dow. Listeners are invited into the insights gained from Gundersen’s recent trip to Silicon Valley, where big tech and emerging trends set the stage for important discussions about market direction. Gundersen also touches on the crucial topic of where the market might be headed, sharing his thoughts on potential tops. As
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 02 :
And welcome to the Monday morning. It is the September 22nd live edition of the Best Stocks Now show with professional money manager Bill Gunderson, president of Gunderson Capital Management, a coast-to-coast company. nationwide fee based only firm and i’m here with barry kite our chartered financial analyst and uh… we’ve got a mixed start to the market get guess which index is up and guess which one is down you got it yes the nasdaq is up again it’s up twenty one points i believe that’s a new all-time high at twenty two thousand six hundred and fifty two but the dow is down a hundred and fourteen points After hitting a new high last week, it’s at 46,201. The S&P about flat right now, 6,662. It’s down two points right now. Small caps are down a quarter of a percent. Interest rates are stubborn, even though I think interest rates reflect our Fed chairman. He’s pretty stubborn himself. Rates very stubborn up there at 1.13% today. They’re supposed to be coming down, but instead they’re mired in that 1.13% range. Gold is hitting a new all-time high today, up 1.3%. And a pretty hefty sell-off in the cryptos today with just some distribution, some heavy selling, especially in the cryptos outside of Bitcoin. So welcome to today’s Best Stocks Now show with professional money manager Bill Gunderson, president of Gunderson Capital Management. And I’m here with Barry Kite, our Chartered Financial Analyst. And we are home from our foray into the Silicon Valley, which was really, really a fun week. It’s a whole new world out there. It definitely is compared to sleepy little Charleston, South Carolina. But I’m from Southern California, so I’ve seen plenty of hubbub, you know, in the biotech sector and the tech sector right there in San Diego. But nothing like that Silicon Valley, Barry.
SPEAKER 01 :
When we had the big news while we were there for Intel, they had a big announcement while we were out. So that was kind of neat to be there when their stock was up 25% in a day, I think. Yes.
SPEAKER 02 :
And, you know, as I thought about all of the different folks that we talked to, I mean, dozens, literally dozens, Not counting the workshop, which had, I don’t know, 125 people, something like that there. And I would say the one question, the most pervading question that everybody has is, where’s the top? Not where’s the beef, but where’s the top? They all have this feeling of, you know, we’ve been through this cycle several times in the tech sector, and this time it’s AI driving the autonomous bus, I suppose you could say. And where’s the top seems to be in a lot of people’s mind. And I addressed that in my newsletter over the weekend. Not that I’m going to call the top. The top could have been Friday. You really don’t know where the top is until after the fact, right? Unless you’re the luckiest guy out there and have a crystal ball that’s absolutely 100% right and you call the exact top. We’ve been pretty fortunate to call one, two, three, four bottoms. And it’s not like I’ve put out 100 articles on bottoms and got four right. No, I’m four for four on bottoms. Tops, well, Bill, can you call the top? Well, you know what? No. The answer to that question is no, because you’d have to pick the absolute. You’d have to sell when the market looks the absolute best, right, hitting new highs.
SPEAKER 01 :
Well, and, yeah, I mean, last year we had 47 all-time highs, and, of course, in 2025 we’ve added to that all-time high tally. And so if you were trying to call it, you know, we’ve been at the top for an extended period of time.
SPEAKER 02 :
Yes, and we keep hitting new highs.
SPEAKER 01 :
Right. New tops. New tops. Right.
SPEAKER 02 :
But there are definitely lots of clues that we can look to. I look at it this way, Barry. You see a guy line up for a 100-foot putt, and it’s uphill, and it’s got to lean to the left. He just wants to put that putt close to that pin, right, so he can two-putt the thing close enough to tap it in or at least a three- or four-footer to save par. You know, that’s kind of what I aim for is to be close to that top. And, of course, the clues, we’re going to talk a little bit about here today what will start to happen. You know, it’s going to be valuation. Technical analysis, evaluation measures, believe it or not. And then technical analysis of the individual stocks in the markets. Those are going to be the two biggest clues. And, of course, the economic reports that we get on a weekly basis. As we sit here today… September 22nd, the quarter ends in eight days, a week from tomorrow, Tuesday, and that will be the end of the third quarter. The companies will start tallying up, counting the beans. The bean counters go to work and how many came in, how many went out, how many were left over. How does it compare with the analyst estimates? How does it compare with the same comparable quarter last year? And we start earnings season all over again, which is the last earnings season of this year, because after that it won’t be until the first few weeks of January of next year, okay?
SPEAKER 01 :
Could it be some of the last quarterly reporting we ever had?
SPEAKER 02 :
Well, yeah, they want to cut that in half. I’m not a fan of that. Me neither.
SPEAKER 01 :
I’m a fan of information.
SPEAKER 02 :
Yes, I think Wall Street’s pretty entrenched in that quarter. That’s a whole cottage industry. But as we sit here right now with a little over three months left in the year, the S&P is up 13.3% so far this year. But that doesn’t really tell the story. It’s the valuation underneath that 6,670 level that we’re at right now. which is really key. If you’ve been short the market this year, SH, the S&P 500 short, it’s down 11.6%. You chose wrong if you were a bear and have remained a bear in the market. The Dow is up just 8.9%. We call it the soggy Dow, and it has trailed the NASDAQ once again by a pretty wide margin today. because it doesn’t have the growth that the NASDAQ has. The NASDAQ is up 17.2%. So once again, double, double the Dow Jones Industrial Average. The small caps have had a very, very soggy year. The S&P 600 up just 3.4%. Small caps continue to lag large caps by a wide margin. The Russell 2000 has done a little bit better. It’s up 10%, having one of its best years in quite some time. But just keep in mind that inside that Russell 2000 index, there’s only about 50 good stocks. The total world index is up 16.4%. Emerging markets have outperformed every U.S. market so far. China has been a big factor in that this year. Cheaper China, I would call it, has definitely drawn a lot of interest this year, and AI in China. The emerging markets are up 21.4. Europe’s at its best. year in recent memory. I think that had a lot to do with money fleeing the markets earlier this year, afraid of Trump and the tariffs and the currencies. Europe’s up 24.7%. But here’s China. It’s the leading index in the world this year, almost. Latin America’s a little better. China’s up 34.5%. 34.5%. We’ll give you some interesting takes that we heard while we were there on people that have worked in the Silicon Valley for Chinese companies. A little inside baseball there. China up 34.6 and definitely a much lower rate. half the PE ratio that U.S. tech stocks are at, maybe one-third the PE ratio. Latin America up 36%. A lot of that was Argentina, but now all of a sudden Argentina is not doing well. The bond market, the U.S. Treasury market bond fund up 4.5%. This is one of its best years in a long time. You’re going, really, Gundersen? The bond market’s up 4.5%, and this is one of its best years. Well, over the last 10 years, it’s averaged about 1% per year. So, yes, it is. And last but not least, we’re going to give the award for the star of the year, year to date, to gold. A gold medal to the gold markets, which are up 40.4%. 40.4% hitting a new all-time high again today. Who would have guessed that gold would be the big winner here? We have exposure. We haven’t had exposure for a long time. We have exposure to gold. I wish we had more. Woulda, coulda, shoulda. When we come back, you know, we met with a lot of people from India during our week in Silicon Valley, and there is news on these H-1B visa fees, which is rattling the tech industry today. We’ll be right back.
SPEAKER 05 :
We’ll be right back.
SPEAKER 02 :
And welcome back here to the second quarter of today’s Best Docs Now show. I want to get into the current valuations of the market because that’s one of your biggest clues, obviously, as to where’s the top. But this story caught my eye. Trump’s $100,000 H-1B visa fee rattles the tech industry. uh… so anyways i thought i would bring that up india has been the largest beneficiary of h one b visas accounting for seventy one percent of the visa holders in the u s last year most of these visa go to stem professionals And Amazon has seen the most H-1B approvals yearly since 2020. Jeffries called the $100,000 a curveball for the Indian IT sector, saying companies will likely reduce H-1B usage as the fee offsets the EBITDA generated per employee over the visa period. So we’ll see. I mean, Indian stocks are sliding a little bit, 2%, 3% on this news. Okay, valuations. Okay, I woke up Saturday morning. I’d already had a good start on the newsletter, able to work at 30,000 feet, Barry, with a pretty robust valuation. The internet connection and a good breakfast, I will say that. United’s my favorite. I don’t care for Delta anymore. That’s just me. Their planes are old. And the cushions are all squished. My back is sore, you know. And I had a beautiful seat in American and United. But Delta, I always get in one of those old planes. I don’t know. All right. Oh, poor me. You know, my ancestors walked across the plains pushing a hand cart, right? And I’m complaining about a not-so-soft seat on an airliner.
SPEAKER 01 :
I did get stuck. I did get stuck in Dallas, Fort Worth. On the way back, they had, I guess, some kind of FAA communications line that was cut.
SPEAKER 02 :
during you know some kind of construction yeah and so uh i think it affected dfw and love literally no planes no planes left for at least like two and a half hours wonderful well i flew through no problems in atlanta but i left the key to my car which was parked at the airport somewhere in san i left my key in san francisco tony bennett left his heart in san francisco I left my key. Luckily, but I did have to take an Uber home and get my key. And then my wife and I went and picked it up the next day. Okay, current valuations of the S&P 500. We need to put into perspective. This is the biggest clue. Where is the top? Okay, so the four valuation measures are price to book value, price to earnings, price to cash flow, and price to sales. How are we doing in each one of those four all-important valuations? I went back 20 years and looked at the charts of these valuations over the years. We are hitting a 20-year high. of 5.4 x on price to book value that’s the s p 500 okay so uh you know we got back uh we got up to five during that covid year you know that that that 2021 was definitely a uh a bellwether year because that was the top of the market Before we went, before the Fed, the Fed put in a top, okay? The Fed put in a top in the market by signaling a tightening cycle. And that brought the markets to a screeching halt in late 2021. And 2022 was a bad year in the market. Put that one in your memory bank the next time the Fed decides to go on a tightening cycle. Get off the railroad tracks with anything long-term. bonds or stocks because they don’t do well. But the price to book got up to five at that time. We recently hit five and we’ve gone to 5.4. 20-year high price-to-book value. P.E. ratio. This is more common, used more than price-to-book value. Well, during that sugar high with all the COVID money sloshing around, the S&P hit 30. It hit a P.E. of 30, and then the Fed went on the rampage as Jerome Powell driving the locomotive, coming around the curve. He didn’t blindside the market. He definitely sounded his horn, and the smoke was coming, and you knew he was coming, and it was definitely time to get off the tracks. Silicon Valley Bank obviously completely missed that signal, stayed on the tracks, and now they’re no longer in business. businesses they were loaded with long-term u.s treasuries that got cut in half during that period of time so price to earnings got up to 30 in 2021 we’re currently at 27.8 27.8 so will 30 spell the top when we get to a pe ratio of 30 i don’t know but i’m just telling you that was the top But you also had an extraordinary event that was a tightening cycle that was well signaled. This time we’re in an easing cycle. And I saw Goldman Sachs comment today that that’s going to extend this bull market, the easing cycle. And we’re not at 30 yet. We’re at 27.8 on the PE ratio. Price to cash flow. We’re matching the high we hit in 2020. We’re at 19 times price to cash flow. Okay. That’s a little different than price to earnings because cash flow includes your interest payments, it includes your borrowing, it includes the raising of funds, that’s cash coming in and cash going out obviously is a lot of different things but it is a measure that we compare over the years were very lofty numbers on price to cash flow. 19.0 on the S&P 500. Price to sales. We got up to 3.3 in the sugar high of COVID and we’re now at 3.3 once again. So you have three out of four of your common valuation measures on the S&P 500 hitting 20-year highs or equaling the highs that they hit back in 2021. So there’s a clue. We’re definitely a long ways from the bottom of this current cycle, which was 2023, January of 2023. I called the bottom on the NASDAQ, was within a day of that bottom. And now here we are almost three years later, not quite, two and three quarters years later, We’ve come a long, long ways from those lows of 2023, January of 2023. But as I say, we’re in an easing cycle. Now, when we come back, I want to go through the NASDAQ valuations. We have about a 15-year history. Where are we right now compared to the last 20 years on the NASDAQ? 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. I put several hours of research in during the wee hours of the morning each day to bring you the very best cutting-edge stories that I can. To get two free weeks of my newsletter, go to GundersonCapital.com. To talk to us about our fee-based only money management services… Call us at 855-611-BEST. Now, back to the second half of the show.
SPEAKER 07 :
And welcome back here to the second half of today’s Best Stocks Now show.
SPEAKER 02 :
As the market hits new highs, the buzz in the Silicon Valley, from my observation, is where’s the top? Well, we’re looking at one of the big clues, and that’s valuations, okay, where historically they’ve been. You’ve got to go back to 2022 during the sugar rush COVID high to find valuations as high as we are today, and then you’ve got to go back to 2000. The year 2000, March of 2000. I met one guy. He worked for JDS Uniphase. That was one of the poster childs, Barry, back then. I remember that was one of the hottest stocks in the entire market with fiber optic chips and routing, etc. I said, what became of that? He said, well, it went down to under a dollar. It’s still around today. It’s lumen. It’s lumen now. But there were many stocks. A lot of them went to under $1 and then to nothing, to nothing. All right, that was the year 2000, the NASDAQ, the dot-com bubble. So let’s look at that venerable old NASDAQ, which has been hitting new highs and really leading the parade up twice what the Dow is up so far. This year, as we look at, we only have about a 10-year history on the NASDAQ. We are now hitting a 10-year high of 7.4 on price-to-book value. We have to go back to that giddy year of 2022 to find this. Actually, we’re just a little under that or right at that high that we hit in 2022. The difference is we topped out in 2022 on price to book value as a tightening cycle went into effect. And now we have an easing cycle. The current PE ratio is 33.1 on the NASDAQ. Compare that with the S&P, which is 27. It’s because the NASDAQ gets a richer multiple due to higher growth rates. The 10-year high multiple on the NASDAQ was 36. Back in the COVID sugar high year of 2022, we’re at 33.1%. Price to cash flow is now at a 10-year high of 23.2%. So that’s an all-time high there, or hitting that high we hit back in 2022. And notice that the price to cash flow on the NASDAQ is 23.2. The S&P is 17. I would say that the S&P does a lot more borrowing and issuing of bonds than the NASDAQ. That’s one reason why that is. And, of course, the superior growth rates. And now the price-to-sales ratio is also hitting a high, a 10-year high of 5.2x. All right, so there’s a few clues. And then, of course, you know, the technical analysis of the indexes themselves, Barry. They’re hitting new highs, so you can’t say… that they’re starting to level off just like my plane flight eventually leveled off at thirty thousand feet flew over a middle america the center of america man i just looked down below and all the farms that that’s what just blows you away so how rich the soil is of america and then of course we leveled off and then all of a sudden the seat belt light came on it was time to put the laptops away and we’re coming in and we’re going to start descending and i stock charts do the same thing uh… the nasdaq’s been going up up up up up it has not really it’s leveled off many times along the way but each time it’s broken out to a new all-time high But eventually you’re going to level off. You’re going to hit that 30,000 feet. You’re going to go maybe sideways for a while. Then you’re going to start to come in for a landing. Let’s hope it’s not a crash landing with valuations up here. But don’t forget that not only will the index do that, the individual stocks will do that that make up the indexes. they’ll start to crumble first. It’s been my experience that usually the software sector kind of leads the parade to the upside and the downside. I’m going to adjust that just a little bit. I would look at ARK funds. Someone said to me, well, Bill, why key in on the NASDAQ? Let’s go to the outer edges of the NASDAQ. I agree with that. To where the most bloated areas of the market, ARK funds would be a very good one. It will definitely start to lead the market lower because it’s at bloated levels. And it includes a lot of crypto. And I would say that, you know, crypto would be a big part. It may be the first to go, especially the crypto-related stocks, the Coinbases, the BitDears, I mean, the IRENs. You could go on and on and on of these crypto stocks that don’t have a whole lot to sink your teeth into in the way of, you know, what’s underneath it, what’s it backed by. I could see the crypto turning first, and I think Cathie Wood’s ARK could be a leader to the downside. Therefore, the first hedge I would put in and look to would be SARK.
SPEAKER 01 :
Right, Barry? I was wondering if that’s where you were going. I was thinking about it, too.
SPEAKER 02 :
SARK got crushed. In 2022, I think it was up 60%, while the NASDAQ went down 30%. So I would look to SARC, and that’s one of the charts I look at every day. There’s a few charts I look at every day just as clues, okay? And then I think the second area to go, the small caps have had a better than usual year in 2023, even though it pales in comparison to the large caps. I would look for the small cap. Russell 2000, which is the junkier end of the market. The junk’s going to go first, too, before the quality goes. And then obviously the highest PE stocks, and there are inverse ETFs that pick on their high beta. They pick on high beta stocks that are very volatile, and they create an index, the high beta index, and there’s inverse funds on the high beta index. Well, that will cushion the landing as we descend, whether it’s 20%, 30%, 40%, 50%. We just don’t know. And they could also be quite profitable stocks. at some point in time also. Inverse crypto, BITI, I look at that every day. It’s been crushed this year, right? If an asset class is hitting new highs, its inverse companion is hitting new lows. All of those would be clues. SQQQ, you know, Barry, you guys went and rang the bell for TQQQ earlier this year, which has tripled the NASDAQ.
SPEAKER 01 :
Yeah, the largest leveraged ETF out there. And the best performing.
SPEAKER 02 :
If you think about it, triple Q. So it’s nine times, really. It’s Q, Q, Q, Q, Q, Q. Nine Qs. Now the opposite side of that trade is SQQQ. So I’ll be watching that. SDS is triple inverse the S&P 500. Now, I had somebody ask me, Bill, I sold a month ago, and it keeps going higher. Would you get back in it? It depends on the stock, okay? No, I wouldn’t buy back all the stocks that I sold. And we have, I mean, we’re 35% cash today. in our most volatile, the long-term, which Cathie Woods doesn’t have that ability. In her ARC funds, she remains fully invested, or 85%, 90%. We have lowered our highest and most volatile, highest beta area of our portfolios. And, of course, we will continue to raise. And if it gets worse, we would hedge. But for the most part… I think we’re 80%, 85% invested in our large cap, premier growth and ultra growth, which is more in the mid caps. Both those portfolios hit highs for the year. Where’s the top? Well, we’ll be on the lookout for that. Now, like Goldman Sachs says, the Fed rate cuts could prolong the U.S. equity rally despite these valuations that we’re trading at. Okay, I talked to a couple kids yesterday at our church there that I help out with. They’re in the nuclear sector, and we did some talking yesterday. Did you see the nuke stocks on Friday, Oklo? New scale, UR Energy, Nano, they’re selling off a bit today. But man, and the quantum stocks had a huge week. They would be the first to turn when we hit a top and start to descend. We’ll be right back.
SPEAKER 05 :
You’ve got to go where you want to go.
SPEAKER 02 :
And welcome back here to the final segment of today’s Where’s the Top edition of the Best Docs Now show. Well, where is the top in the autism issue, Barry? This could be the day. I don’t know. Look, that’s all I know is autism has exploded. And how much money has been spent, how many clinical studies, how much research has been done trying to find the cause of it, number one. And then number two, help for it. And today’s going to be a big news conference at the White House. And supposedly it’s going to link the use of popular painkiller Tylenol taken in the early stages by a pregnant mother to the huge increase in autism. Could it be that simple? You know, I mean, couldn’t they have figured that out a long time ago? Now, that’s Johnson & Johnson. Kenview was spun off by Johnson & Johnson, yeah, maybe three years ago.
SPEAKER 01 :
And that’s a very common, you know, drug, I mean, in terms of Tylenol, right? Yeah. I mean, that’s…
SPEAKER 02 :
And, of course, RFK, I mean, he’s on a mission to put an end to the autism explosion. They also supposedly are going to announce a drug that could help folks with autism. So, hey, you know what? I hope and pray that we found the major cause. It’s kind of like hiding in plain sight, you would think. A company like Johnson & Johnson now, unless, you know, I mean, you’re on the other side of this and says, well, it’s not good science that they’re using, blah, blah, blah. Well, we’ll have to read the research papers, I suppose, when they come out. But Canview, obviously, is the company that’s a major maker of acetaminophen. and Tylenol. So we’ll see. That’s supposedly going to happen here today. NIO highlights new vehicles, key innovations at a special weekend event. I bring this up because we did talk to somebody at Silicon Valley. We met with him. He actually worked for NIO here in the U.S., They had a plant in Silicon Valley. I mean, I guess they had plans of having NIO cars going around America at some point in time, but eventually they had to close that plant because those Chinese EV cars are not getting into the U.S. But he talked about China and how the workers there in China, what was it, 996? Is the mantra. The workers in China work from 9 to 9. 12 hours, six days a week. And many of them just sleep at the office. The Silicon Valley, at least you have a choice. I don’t know that you have a choice in China. We also heard that Tesla, we had another person that works at the Tesla factory building humanoid robots. That’s the one right along 101, you know, just south of San Francisco and not quite to San Jose there. He says they’re busing in workers on a two-hour trip. from the Salinas area, two hours on a bus. Musk gives them a bowl of cereal and then two hours home at the end of a long day. So four hours commuting on a daily basis at Elon Musk Tesla. We heard just different things. That is all interesting. But anyways, and the other story that I saw today, Berkshire Hathaway, I beat him to it. I don’t know when he exited. We exited completely our BYD position. Berkshire’s totally out, Barry. 17 years. exits the BYD position.
SPEAKER 01 :
We wrote about it in an article a few years ago. Remember how big a position they had? I think it used to be around 18%, maybe a little more. And they’ve unwound it over time and kind of probably averaged down as they sold it.
SPEAKER 02 :
And then eventually, now he’s completely washed his hands of it. I’m sure they made a nice profit. And I’m going to end with this story here. When I looked all through my suitcase, no key. All right, so my car is right there. I just drive home. We’re just 20 minutes from the airport or so. So I had to take an Uber, right? And the driver was from Venezuela. maybe 35 years old. He spoke very broken English. He’s been here for four years. He was telling me what it’s like to live in Venezuela under Maduro. He was a school teacher. He was a teacher. You know what he got paid per month, Barry? What’s that? Twenty dollars. So let’s not rag on Musk too much about the four-hour trip and the bowl of cereal and the 996 in China. $20 for a month’s work. And no wonder he’s here and no wonder why. And he showed me pictures. I told them I was a fisherman. He said, Oh, he, he catches pickle bass in the Amazon river. He showed me pictures. He catches them on lures. He’s a fisherman. Uh, and that’s how he was able to supplement, uh, that’s good to be a fisherman. Uh, and he used to go fishing every day. Now he works at a plant out in Somerville that makes parts for cars. Something for the seats. He works full time and then he drives, you know, does Uber in his spare time. He’s got a wife and two children here from Venezuela. He’s not a fan of Maduro, I can tell you that. Maduro’s not even from Venezuela. He’s from Colombia. Hugo Chavez was from… I get in conversations with people, Barry. I try to learn. I’m learning something right now. I think I’d go pinto bass fishing in Venezuela, but I don’t know if they’d let me come home. I don’t know if I want to go there or not. And last but not least, that Boeing plant, it’s booming. They get a 250 jet order from Turkey as Trump is to meet Erdogan. I don’t know where they’re going to stick the runway where they park the planes. I noticed that even they had half-built planes on the runway because I’m sure their hangars are full. Wow, things booming there at Boeing right now. Boots on the ground observations. Where’s the top? Well, we stay invested for now, but we watch very closely on a daily basis. All of our holdings. Vigilance is the watchword. 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 SIBC and FINRA.
