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tv   Tech Check  CNBC  November 24, 2021 11:00am-12:01pm EST

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have a great thanksgiving. >> right back at you hope it is a great one for you and for all of our viewers our executive producer will be holding for the thanksgiving day parade >> it is the coolest gig ever. to you and all our viewers, happy thanksgiving >> that's it for us. right back at you. tech check begins now. ♪ happy wednesday, welcome to tech check today, tech has an attention span problem why historically low interest is
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leaving few winners the potential new strategy, arc on steroids and the investor taking it to the other side of the trades finally pop the hood, this stock is having serious trouble. why shares of robinhood are down. a multi-day selloff of tech stocks nasdaq lower by a quarter of 1%. the hardest hit have been the smaller growth stocks. peloton, crowd strike. kathy wood on "squawk box" this morning touting a new strategy she's testing that she says is, quote, like ark on steroids. >> what we would be doing is shorting stocks in the big benchmarks
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when we get into a risk off situation. what happens is portfolio managers and analysts run back to those and get closer to the benchmarks and dump our stocks which are either not in or small part of benchmarks great opportunity for us to pick up on those. it is simply a risk off hof to get closer to benchmarks we think those are the bigger risks longer term. those are value traps being
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disrupted. arguing for megatech and telecom and looking past those dynamics right now. >> sounds fancy to me. >> i look back at the previous cycle and the dot com bust and the financial crisis often what we failed to do is think what were these company's abilities and does that line up with where things are headed. i think the conversation needs
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to get back to that. calling on conversations by name this is a unified systems. more than one thing, video chat maybe some of these deflationary forces like cloud and ai >> it has positive comps last last year. on tech and consumer laggards pointing out much of the selling is concentrated with the highest price to sales multiples good to
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see you. what a week we've got going on higher yields are bad for long-term growth names you say they have a quibble of that is. >> we are two days into the week and tech has sold off sharply. look back at last week techout performed s&p 500 by two full percentage points i think some of that is coming back with reversion to the mean. six weeks in a row in the history of the stock, that's only happened five or six times. back to your point about rates and tech stock we've heard it is like crypto
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night in the technology sector looking back we've seen tech stock has done really well. so there's been 15 periods where it is rising all 15 of those periods where rates were rising, tech was higher in every one of those. 15 out of 15 s&p also higher 14 out of 15 times. not to say it is possible for tech to rise in that environment. i think what we are seeing in
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the initial stages of the higher rates seeing these selloffs and that sector getting back on track if you were to start betting on the technology sector here talking about tech over y'all touting some of those best performing stocks looking at whether that was important with mobil wireless or web 2.0
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investors have been showing much stronger sales just getting back to the trial going back to the early 90s. after 2000, that only happened one other time in 2013. the cloud stocks are in an
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emerging group you are seeing a volatile sector so to the cloud stocks, we are going to see for today. two weeks, the sectors are down 10% the cloud etf was down it has gone back in on the climb you want to be looking at these
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cloud stocks >> seeing these lower again today. she said she likes tesla those are ev plays do you thinks that right if you are looking for that car space ultimately do you think lucid and rivia has that >> in the ev space, tesla is a name we've liked and owned it has proven itself it is not cheap. it can scale up production and scale up factories
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there is a little bit more hope. the ev space accounts for 38% of global market cape and 2% of revenue. i think what you would see if we were to pick a name within that group, tesla would be a name we'd see ahead of others >> you make our job a lot easier thank you. >> you too happy thanksgiving >> meantime, if you are looking for opportunities. mixed feeling on the add space looking ahead to next year due to apple's privacy change. snap and pintrest reiterating those openings
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those apple changz significant head wind. >> and still to come, what is happening to robinhood stay with us after the break
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robinhood stock is down 20% in the last five sessions. 30 over the last month our next guest saw this coming issued under weight in august and has been straight down hill since then. what do they have to prove >> it has gathered a lot of accounts almost as many as schwab has and they've been around forever.
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>> they can prove they can take this larger client if they look at what they did, so those need to be growing in the future >> heading up. money to be made, it seems like that in the market would dip or dive brokerages are a bit more proven
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there. what does robinhood have to prove in that growth segment >> ultimately, in that market that would grow where it would actually occur and be inevitable to some point. if you go back to that tech bubble trading volume was high in 99 took seven, eight years to
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recover. >> getting users to do more. have you seen any evidence that they are getting their users to do more long term? >> there is a lot of companies to get the cash up it can't even take those in stocks into their brokerage account. it would take a lot to just do the basics to catch up with their brokerage never mind with their aspirations in that stop they'll get there but they have
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a lot of wood to chop in the meantime >> the other guys are just standing still schwab is close to their highs of the year. with that 28 million account and users but only have about $4,000 per account. from an account basis, their number of accounts is big they have to catch up to their peers. they have a lot of wood to chop
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in the meantime. >> looking for a different way to highlight the proarticle. arguing metaverse eft would market luxury goods. brands highlighted with the use for vr and virtual store and changingrooms. be berberry already the after world collection that used a video game to be boo its autumn collection. check that out on cnbc.com
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this week's tech selloff would have been a time to shine if they were short only problem is short interest were at lows short interest at a nearly two-decade low as a percentage of market cap around
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1.6% levels reached in 2021. previously not seen in the dot com era. a missed opportunity for hedge funds. the short shakeout that's a culprit. that rise in retail activity that would make them go less inclined in general. for those who still felt compelled to go short. this did create a few winners for them including beyond meat and workhorse group which both slumped. you can see beyond down about
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6% workhorse down almost 12%. hedge funds lifted their exposure many of those still unprofitable and feeling the brunt this week. comparing this shortage of shorts people get up set with beavers for building a dam in places are we perhaps seeing a beaver effect in short-sellers?
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for those who take place earlier this year. has lead to the other sidelines when it comes to short sellers because they don't want to become victim to this. people say how history doesn't repeat itself. is that a sign people are either too bullish about the market increasing exposure to those stocks about 10 times ebita or is it a sign there is this other dynamic going on with retail that really says nothing about what is going on with regard to the market as a whole. those are the type of questions we'll be asking as we try to dissect what is going on right
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now. >> the webeaver effect. i thinks that a new technical term >> recently introduced the capital short innovation e etf ark. here she is defending her approach >> we believe innovation truly disruptive innovation is prices in the global marketplace between $10 and $15 trillion in 10 years, we think that will gl to more than 200. it will go from 10% to what we believe will be more than half that's how much sis rupgs is evolving thank yous to dna
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sequencing, and more conversioning so s curves create s curves creating the most innovative period going back to early 1900s and the automobile to see anything likeit >> what has been the response so far in terms of interest and blow back the interest has been extremely mixed. ark has a lot of raving fans some of them have reached out to
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me on twitter. and had some comments i can't repeat making highly concentrated debts where you are more transparent some of them have reached out to twitter and they are maybe a little nicer >> doesn't surprise me, i suppose. >> this is just a vehicle for detractors to push a button with other practical opinions when we do see some of these higher momentum names sell off. >> that's why we initially launched the fund.
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it is a great headge. you think the s&p must be down and they are not those will be really disappointed this is a much better hedge. they go down a lotmore maybe they believe it or feel the short term effects in a
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rising rate environment the interest rates could rise quicker. they could be a correction of something long overdue a lot of reason why people are using this >> talking about the relative shortage of shorts given the market you laid out, isn't that dangerous because there is not as much down with these stocks ahead as they should be >> it could become a
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self-fu self-fulfilling prophecy look at zoom video yesterday look at zillow last week they didn't need anymore rocket fuel to be volatile but that could be the case. >> thank you for being with us and sharing. time for a news update let's get to rahel solomon >> weekly jobless claims tumbling to 199,000. the lowest weekly claims since 1969 consumer spending helping estimates and doubling the increase growth is also well above estimates. at the time even as housing
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prices continue to decline deere says margins will continue to fall. workers and supply chain issues predicting the demand will foresee the ability to reduce it in order stom and gap both down 22%. retailers warning of supply chain issues and rising costs. you are up to date, back to you. >> two earnings movers to watch and they are moving. powering shares of hp empire taking pure storage to all-time highs up 13% more up to date opportunities after the break.
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risk and reward, i see one element securing portfolios, time after time. gold. your strategic advantage.
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pre-ipo they who not load more than $300 million off investments of the year.
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those shares up more than 50% from the ipo >> exclusive reporting, signing a manifesto pushing back on the vaccine policy a couple hundred employees, a small percentage but we've seen in the past a small vocal group of the company has had success seeing out sized impact >> i'll point out, it is about 600 employees that have signed up that is up from 100 employees in august you've seen a five fold of employees signing this manifesto against the company.
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as you mentioned, google has a history of very outspoken employees. they've been able to get things changed do i expect they could get this turned over at this point? i don't think so in this tight labor market, it poses challenges >> speak about this latest in terms of google's changing can you will tur you've reported so well on. they started, don't be evil encouraging feedback but that is has turned into an issue >> the company has always had this open discussion, channel and culture.
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you've seen the company changing its mission from don't be evil to organizing the information. it is a shift. part of that is a shift of how the company is approaching business as a talent attractor this company that was like a fun search company turned into a corporate business focused on cloud deals, big corporate deals that is part of the company's past and history >> thank you for that. by the way, the exclusive scoop lives on cnbc.com. tech check is back in a minute
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that's the thing about claims, you see. they don't happen on your schedule. i mean, take a chestnut, it doesn't just say “oh, beg pardon, sir, but is now a good time for a jolly bit of window cracking?” i mean, if they did, you wouldn't need a geico claims team that's available 24/7. but, near as i can tell, chestnuts don't talk. or maybe they're just really quiet. geico. your claims team is here for you, 24/7. well, got things to do mr. chestnut, so...
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>> out for stock today from those buildings. cutting the target to 310 down from 365 shares are in the penalty box under progress shares of auto down lower for the year >> this company that checks and corrects grammar increasing over five fold from its last round in 2019. >> we want to make sure that is
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available everywhere people connect through garden or sweet os in that customer experience that's on a solid foundation. >> we align the business model with our users we are only paid by our end users. >> you can check that by the tech check social channels >> where have we heard that before this phrase like some of the incumbents in issues like microsoft. google, apple. >> i thought grammar wasdead o
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line how about making your words and grammar look different watch dell and gm there, you can see both are up more than 3.5% right now on cnbc.com. more tech check in a moment.
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welcome back in the green today software and cloud stocks have been hit especially hard out with earnings. beating expectations reporting a loss and our stock moving up higher are about 6.5 to 7%. good to see you again. i want to ask you particularly about your reintroduction of guidance here. given what we saw from auto desk and another software what is giving you that
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confidence to be able to build visibility at this point >> one of the things as you know we've been doing transforming to be a subscription company. at this and we have the stability of the renewals business starting to kick in so this, combined with the solid operational that we've built over the last four quarters, that we've consistently beat expectations and raised them going forward, gives us the confidence to go to annual guidance to investors and that's what we did this quarter this quarter, itself is the contact with the valuable growth 33% year over year and the cash flow will break even generally the company is performing well and we felt like giving guidance. >> the new customers and logo growth, that is down a bit year over year.
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you gave explanation for that and that is skittish about what that might mean in the past and that's when we've had over 20,000+ customers. more recently we focused at first on actually building bigger business with customers our sales force is focused on getting higher dollar values with customers and focussed on bigger market more into the en enterprise and so that has a natural impact and you get more dollars per logo indeed, that's been the case over the last year that we've seen gradually and that's the trend we're continuing and as we go forward, we make sure we have the proper incentives in place to continue driving these new logos and the upsell business continues to be a foundation, right? we keep building that and while we will prosecute business at a much lower cost point and that's
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the life point of a subscription economy and so we invest in continuing to build a new and upsell business as well as making sure we prosecute renewables >> you do point out that you have a better understanding of what we call potential fluctuations in the average contract term length down a touch year on year >> is that a sign that clients are more cautious or what would be the shorter length of a contract >> not at all. this is our fiscal q1. it's a strong quarter for federal and it tends to do shorter duration contracts compared to the rest of the business that we have. so we've gotten good visibility. so every q1, they come down a bit and they go back up in q2. so the contact was 3.1 years and they'll trickle up maybe to 3.2. it will remain in that range as we go forward.
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>> rajit, we'll be talking about a lot of cloud and infrastructure with aws reinventing and one of the themes likely to be multi-cloud which is an area where you guys play and what are you seeing as the key point of advantage and leverage that will determine whether the customer will go to nutanix, versus the number of multi-cloud players and what are you offering that's working? >> absolutely john good question there and fundamentally if you look at what the customers are trying to do, they're operating in a multi-cloud world, they choose the cloud for the right applications and they run the flexibility, and whether it be based on cost, and whether it be based on business reasons and whether it be based on the specific services offered by a cloud provider and that includes on print the edge locations as well as public cloud of the choice
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nutanix provides a value proposition for our customers in that regard and what we do is we provide a single platform, single software stack that they can deploy in a consistent way across any of these locations. we do data really well we manage all forms of data and that's the key differentiation. >> right >> because customers need to manage the data everywhere very simple platform and the simplicity for the enterprise. complete flexibility and choice and the choice of hardware, and choice of cloud and choice of licensing duration and terms and our customer support is off the charts and it's a 90. it's a way of a high quality that you would argue of avoiding vendor lock-in so many customers exist on all kind of cycles the ceo of nutanix
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>> deliveroo, upgrading forecasting and strong growth ahead as they see delivery sales exceeding expectations and just eat takeaway, becoming a take over target with just eat shares down 40% since january dinner, carl, would definitely be at a discount >> meantime, joan us later for a cnbc special it's "crypto night in america," a primer on the sometimes messy world of crypto, pushing back the noise and telling you instead where the moneymaking opportunities is it's tonight at 6:00 p.m. eastern time on cnbc we're back in a moment give you the power of sd-wan and advanced security integrated on our activecore platform so you can control your network
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one more thing, this past year, reddit's rowdy crowd on the wall street bets forum became a household name after rallying around video game retailer gamestop sending the stop soaring on the epic run it's undeniable social media coupled with the unprecedented access to the market via mobile apps has given rise to a new generation of online traders
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♪ >> i'm looking at the wall street bets on reddit. >> wall street bets. the red-hot reddit that's already dtit. >> the reddit effect is real and it's shake up traditional financial markets and lowering barriers of entry for individual investors. >> it's nothing short of remarkable >> the forum was founded in 2012, but went mainstream during the pandemic in 2021 when users spurred by retail investor keith gil better known by his online moniker roaring kitty, executed a short squeeze. >> i'm not a cat and i'm not an institutional investor >> leading to a wild rise in the slumping brick and mortar video game retailer once on the brink of bankruptcy. >> gamestop shares, there's nothing normal about what you're seeing when it comes to the stock right now. >> since then, armed with stock trading platforms like robinhood and ameritrade have championed several money-losing companies like amc, bed, bath & beyond
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while they take down short will sellers in the process they've led to congressional hearings and a potential gamification of the markets as well as the evolving role of technology and social media. the whole piece on the cnbc is tech check guys, have a great thanksgiving. let's get to frank holland and the half. >> welcome to the halftime report i am frank holland in for scott wapner the sell-off and growth stocks, they continue. should you buy on the big drop and should you just stay away? will this spark a bigger pullback in the market overall as we head to year end plus one of our commit members making a big move in one of the faang names. joining us for the hour jenny harrington, steve wiss, joe terra nova and jon najarian, co-founder of market rebellion.com. the market trying to avoid a third down day recouping big losses froea

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