>>> YOU'VE CERTAINLY HEARD OF THEIR PRODUCTS. >>> THIS IS THE MOST AMERICAN STORY EVER. BIG PHARMA CREATE ADD DRUG TO HELP AMERICANS EAT LESS. >> 2023 WAS ALL ABOUT ONE DRUG. WITHHE SURPRISE POPULARITY OF OZEMPIC, ALONG WITH THE WEIGHT LOSS BRANDED VERSION, NOVO NORDISK, 2023 COMPANY OF THE YEAR. >> IT'S A BIG CHANGE. WE'VE BEEN A COMPANY FOR MORE THAN 30 YEARS. I'M ONLY THE FIFTH CEO IN A 100-YEAR-OLD COMPANY. WE'VE NEVER EVER HAD PRODUCTS THAT WERE WIDELY KNOWN. IT WAS A COMPANY THAT HAD A PRODTHAT BECAME A VERB OF SORTS. WHY IS EVERYONE SO SKINNY, THE WORLD THAT CAME TO MIND WAS "OZEMPIC." IT SHOWS THE PRIMACY OF NOVO IN BEING A LEADER. >> IN ORDER TO BE COMPANY OF THE YEAR, YAHOO FINANCE DETERMINED THAT NOVO ACHIEVED SIGNIFICANT MILESTONES IN 2023. THE COMPANY DOMINATED THE SPACE WITH WEGOVY AND OS.A.M. YVES PRESCRIPTIONS THEY BEAT THE S&P'S NEARLY 20% RETURN. FOR THE FIRST NINE MONTHS OF THE YEAR, NOVO'S U.S. SALES GREW BY 46%, INTERNATIONAL SALES UP 12, AND OPERATING PROFITS UP 31%. THE IREAS DEMAND HAS CAUSED A SUPPLY SHORTAGE. IT'S WHY NOVO IS INVESTING MORE THAT ARE COLOR 4 BILLION IN EXPANDING THE MANUFACTURING IN EUROPE. AND NOVO IS STRUGGLING TO QUASH NOT APPROVED KNOCKOFFS AROUND THE COUNTRY. THEY HAVE KNOWN AS GLP-1s, A CLASS OF DRUGS THAT HELPS TO INCREASE INSULIN. IN FACT THEY DEBUTED NEARLY TWO DECADES AGO, BUT THE 15% BODY WEIGHT LOSS ACHIEVED BY THE ACTIVE INGREDIENT IS NEW AND A KEY REASON WHY NOVO IS CURRENTLY THE MARKET LEADER. IT COULD BE APPROVED TO MANAGE OTHER HEALTH ISSUES SOON. IT COULD DISRUPT OTHER SECTORS IF MORE PEOPLE TAKE THE DRUGS, ACCORDING TO ANALYSTS. >> BY 2030, THAT COULD ONLY LEAD TO ROUGHLY 2% DECREASE IN SAME-STORE SALES, AND MANY ANALYSTS SAY PERHAPS IT'S NOT AS DISRUPTIVE AS MANY HAD PREDICTED THIS YEAR. RETAILER, WITH MORE CONSUMERS LOOKING TO THAT PHARMACY TO GET THE WEIGHT-LOSS DRUGS. EVEN NOVO'S CEO PUSHED BACK ON THE NEGATIVE PREDICTIONS. >> MY VIEW IS PERHAPS THEY'RE A BIG ACCELERATED, BUT THERE'S NO DOUBT THAT, WITH THE INTERVENTION WE SEE WITH THESE MEDICINES, WE'VE SEE A SIGNIFICANT SHIFT IN THE CONTROL OF BEHAVIOR, AND SOME OF THESE CATEGORIES WILL BE IMPACTED. ♪ >>> NOVO NORDISK AND ITS DRUGS HAVE DOMINATEDONVEATIONS THIS YEAR, BEING BEYOND THE IMPACT OF THE HEALTHCARE SPACE TO RETAIL, SPEED AND BEVERAGE, ALCOHOL AND MUCH MORE. JOINING IS BRIAN SOZZI AND OUR HEALTH REPORTER ANJALEE KHEMLANI. WE HAVE TO START WITH YOU, ANJALEE. WHAT REALLY JUMPS OUT AS THEY RECEIVED THE RECOGNITION. >> I THINK IT'S SURPRISING FOR THE COMPANY ITSELF. I THINK HOW WELL THEY DID THIS YEAR, THE DEMAND OUTSTRIPPING SUPPLY BY A LONG SHOD, THEN HAVE I TO DECIDE LATER IN THE YEAR TO ANNOUNCE RAMPING UP OF MANUFACTURING. I WONDERED IF THE DEMAND WAS GOING TO PETER OUT. CLEARLY IT'S NOT GOING AWAY. I THINK IT'S SURPRISING FOR THE COMPANY AND GOOD FOR TH, TO SEE THAT KIND OF SUCCESS. >> AND THANK YOU TO THE TEAM FOR PUTTING THIS ALL TOGETHER. IT'S AN AWESOME -- AND NOT JUST . BROOKE'S PIECE LOOKS AT THAT, AND IT'S ALL COMING FROM A COMPANY WITH A VERY UNIQUE OPERATING STRUCTURE, NOT SOMETHING WE SEE FROM A LOT OF OTHER COMPANIES, BUT WHAT YOU'RE SAYING, THESE TWO CHARTS TRYING TO CAPTURE THE INTEREST IN SOME OF THESE PRODUCT HERE, LOOKING AT SEARCH INTEREST FOR WEIGHT-LOSS PRODUCTS VERY HIGH, TRENDED UP HIGH OTHER THROUGHOUT THE YEAR, AND YOU HAVE TO WONDER, ONCE MORE OF THESE PRODUCTS HIT THE MARKET, CWHAT DOES THIS DO TO THE FOOD INDUSTRY? >> IT WILL VERY A HUGE IMPACT. AND WHAT THE UPTAKE RATE OF WHAT THAT'S GOING TO LOOK LIKE, BUT JUST A FEW WEEKS AGO. WE WERE TALKING TO ONE OF THE ANNUAL IT'SES TALKING ABOUT THEY HAVE ALREADY SEEN LOT OF INTEREST FROM CONSUMERS, RIGHT AROUND 15%. THEY SAY THEY DO HAVE AN INTEREST, SAYING THEY WOULD BE INTERESTED, WHEN WE GET MORE INFORMATION ABOUT THE EFFICACY OF IT ALSO, AND THE SAFETY OF IT, AND WE ALSO HAVE TO TALK LIMITING SOME OF THAT ADOPTION. SO IT SOUNDS LIKE WE'RE IN THE VERY EARLY INNINGS OF THIS DRUG. >> AND WE ALSO DON'T KNOW WHAT THE LONG-TERM USE LOOKS LIKE. THINGS LIKE OZEMPIC FACE HAVE BEEN ONE OF THE TOP SEARCHING THIS YEAR. OTHERS COMING DOWN THE PIPE, WHAT DOES THAT LOOK LIKE? DO OTHER DRUGS CORRECT THE SIDE EFECTS, THE NAUSEA AND ALL OF THAT? THERE ARE NEGATIVES OF WHAT THIS DRUGS HAVE. WE KNOW THAT INSURERS DO NOT WANT TO TOUCH IT BECAUSE OF SHEER VOLUME OF DEMAND THEY'RE GOING TO GET. AND YOU'RE TALKING ABOUT THE VOLUME, THE MARKET OF A DRUG THAT'S NEV BEE SEEBEFORE, RIGHT? YOU'RE TALKING GOOD HALF THE POPULATION. WHAT OTHER DRUG DO YOU KNOW THAT HAS THAT MARKET? >> RIGHT. ASPIRIN? [ LAUGHTER ] >>> WE HAVE SO CH TO GET INTO. NOVO NORDISK ISN'T THE ONLY MANUFACTURER IN THE CATEGORY. WE WANT TO TAKE A DEEPER DIVE INTO THIS COMPETITION, INTO THIS SPACE. WE WANT TO BRING IN LEE UNDER, AND DAMIAN CONIBERG, MORNINGSTAR'S EXECUTIVE FOR STRATEGY. DAMIAN, YOU HAVE PENALTY YEARS COVERING THIS SPACE. THE EXCITEMENT WE HAVE SEEN, HAVE YOU SEEN ANYTHING LIKE IT BEFORE? >> YOU KNOW, IT'S REALLY UNIQUE. WE HAVEN'T SEEN SOMETHING LIKE THIS. THE DRUG DEVELOPMENT SPACE LOOKING AT OBESITY DRUGS HAS BEEN A FOCAL POI FOR DECADES. WE HAVEN'T SEEN THE EFFICACY UNTIL RECENTLY. SO YOU'RE TALKING ABOUT THE ABILITY TO REDUCE WEIGHT HISTORICALLY, YOU HAVE IN THAT 5% WEIGHT LOSS. NOW YOU'RE PUSHING INTO THE MID TEENS, EVEN CLOSE TO 20%. THAT'S A MASSIVE STEP CHANGE IT DOESN'T FEEL LIKE THIS TIME IT IS DIFFERENT. >> IT IS DIFFERENT THIS TIME, IT DOES FEEL DIFFERENT. I'VE HAD OTHERS TELL ME THAT NOV CREATING THIS OUT OF -- DECADES HAVE GOTTEN INTO THE R&D FOR THIS, ORDERS LEFT THE FIELD, AND COMING BACK SUDDENLY. DO YOU THINK THERE'S ENOUGH ROOM, ENOUGH CUSHION FOROVO AND LILLY TO SORT OF TAKE OVER THE MARKET AND GO HEAD TO HEAD BEFORE ANYONE ELSE SHOWS UP? >> THAT'S A GREAT POINT. THEY BOND HAVE GREAT DRUGS ON THE MARKET THAT WILL START THE PENETRATION. PENETRATION IS AROUND 2%. YOU THINK ABOUT THE ABILITY OF GLP-1 DRUGS. THAT'S WYGOVY, AND THE PENETRATION RATES IN DIABETES. CAN SEE THAT IN OBESIOBESITY, I THINK OVER THE NEXT COUPLE YEARS, THIS WILL BE DOMINATED BY NOVO AND LILLY, AND AS YOU SAID, THERE WOULD BE MORE COMPETITION. CHE, AMGEN, ALL THESE COMPANIES WILL BE IN THE MARKET, BUT MORE LIKE THE NEXT 3 TO 5 YEARS. YOU'LL PROBABLY SEE MARKET PENETRATION INCREASE, BUT IN THE NEAR TERM, THIS IS NOVO AND LILLY'S MARKET. >> DO YOU THINK NOVO STOCK IS UNDERVALUED? >> THE COMMENT ON VALUATION, I CERTAINLY WILL SAY THEY WILL BE THE BLOCKBUSTERS OF ALL BLOCKBUSTERS. CONSENSUS HAS THEY DRUGS GOING NORTH OF $60 BILLION IN THE NEXT PFEIFFER YEARS OR SO. I THINK THE FUTURE IS VERY BRIGHT FOR ALL OF THESE COMPANIES. >> TO ADD ON TO THAT WHAT TYPE OF AT TIFF IN TERMS OF GROWTH PROSPECT ARE YOU EXPECTING? A MULTIPLE THAT YOU'RE LAYERING ON THE NEXT YEAR, TWO YEARS. >> I THINK YOU FOLKS SAID IT BEST, IT'S ANYONE'S GUESS, BUT I WILL SAY IT'S HARDER AND HARDER TO PLAYERS TO PUSH BACK. WE'RE TRYING TO PUSH COST IN THIS COUNTRY TO THE LOWEST SETTING, SO STOP HAVING PEOPLE COMING TO THE ICU FOR HEART ATTACKS OR STROKES, OR DEALING WITH SPINE IMPLANTS OR AFIB. OBITY IDEMIC AT ITS HEAD AND LOOK TO FUTURE COMPETITION TO DRIVE DOWN PRICING. I THINK IT WILL BE DIFFICULT TO PLAYERS TO PUSH BACK ON THESE DRUGS OVER THE LONG TERM. I HAVE SOME OTHER THOUGHTS, BUT I'LL TURN IT BACK OVER. >> I WANT TO WONNER ABOUT THE PROSPECTS LONG TERM. WE HAVE OTHER SECTIONS OF THEIR PORTFOLIO, BUT IT'S LARGELY BEEN INSULIN AND DIABETES PRODTS, BUT DOES IT OPEN THE SECTORS TO BE MORE DIVERSIFIED? >> I HAD A RECENT CONVERSATION WITH AN INDUSTRY EXPERT, AND I THINK BENEFITING NOVO IS THEY'VE BEEN IN THIS SPACE FOR WHILE. THEY HAVE A LOT OF GOODWILL BUILT UP WITH THE PRESCRIBING DOCTORS. I WILL SAY THAT ELI LILLY IS A MARKETING MACHINE. THEY'RE DOING A BIT OF UNFAIR COMPETITION LOOKING AT A HIGHER DOSE OF MOUNJARO AND I THINK THEY'RE GOING TO USE THE COMPARISONS UNDER THERE'S A HEAD TO HEAD TT MOUNJARO HAS SUPERIOR EFFECTS. >> DO YOU SEE ANYTHING TRIPPING UP NOVO NEXT YEAR? >> I DON'T SEE TOO MUCH. YOU HAVE TO BE MORE GRANULAR DETAIL. AND THE WEIGHT LOSS LOOKS GREAT. AND HOW IT WORKS IN RENAL, AND IMPAIRED PATIENCE. THAT MIGHT NOT BE AS GOOD, BUT I GOOD. YOUKNOW, THAT'S ONE POTENTIAL CHALLENGE. I DON'T SEE TOO MUCH TRIPPING UP NOVO. I THINK IT'S SO LARGE THAT THEY WITH DOTH BE SUCCESSFUL HERE. SHE IN. THINK IT'S A MARKET I THINK IT'S A MARKET EXPANSION STORY, SO REALLY IN THE IMMEDIATE TERM, NOVO LOOKS EXTREMELY WELL POSITIONED. ONLY POTENTIAL HICCUPS COULD BE POTENTIAL SIDE EFFECTS WE HAVEN'T SEE. THE GLP-1s HAVE BEEN ON THE MARKET FOR A LONG TIME, BUT THEY'VE BEEN FOCUSED ON DIABETIC PATIENTS. FROM A FUNDAMENTAL STANDPOINT, THE SALES TRAJECTORY IS VERY SOLID FOR NOVO. >>> DAMIAN AND LEE, THANK YOU. NOVO NORDISK, AGAIN, CHECK IT ALL OUT ON YAHOOFINANCE.COM, AND OF COURSE, THANK YOU, ANJALEE AND BRIAN SOZZI AS WELL. BRIAN, STICK AROUND. WE HAVE ANOTHER TOP STORY, WHICH IS MACY'S. THE DEAL WOULD VALUE MACY'S AT ABOUT $21 A SHARE. E STOCK SINCE THE START OF THE YEAR IS OFF JUST ABOUT 15% YEAR TO DATE. YOU CAN SEE IT CLOSED FRIDAY JUST ABOVE $17 A SHARE. FOR MORE, BRIAN SOZZI IS STILL WITH US. WHEN YOU LOOK AT THIS DEAL, YOU'RE A CLOSE FLOWE OF MACY'S FOR SOME TIME. THE RETAILER HAS BEEN STRUGGLING TO GAIN CONSUMEST. >> I SHOULD NOTE, A SOURCE FAMILIAR WITH THE MATTER TELLING ME THIS BID CAME ON DECEMBER 1st AND RRESEED AUT A 32.4% PREMIUM, SO IT DIDN'T JUST HAPPEN OVERNIGHT. IT IS UNCLEAR WHERE MACY'S MANAGEMENT TEAM STANDS ON THIS. MACY'S DECLINED TO COMMENT TO ME ON THIS MATTER. HAVE HEARD THAT THEY ARE MULLING THIS, AND THEY HAVE A LOT TO CONSIDER HERE. THIS ESSENTIALLY WOULD BE A REAL ESTATE PLAY. IF YOU LOOK AT THE VALUATION OF THE ASSETS ON ITS BALANCE SHEET, ABOUT $5.9 BILLION. THERE HAVE BEEN SOME ESTIMATES IN 2022 LOOKING AT THE VALUE OF MACY'S REAL ESTATE CLOSE TO $8 BILLION WITH THE HERALD SQUARE ICONIC LOCATION YOU'RE SEEING RIGHT THERE IN THE PHOTOS. IS THIS A GREAT OFFER? UNCLEAR, BUT ON THE OTHER SIDE OF THE COIN, YOU HAVE THIS VIEW, AND I'VE BEEN TALKING ABOUT THIS WITH JENNIFER LONG. IS MACY'S REAL ESTATE OVERVALUED? WHAT IS THE OUTLOOK FOR SOME OF THIS? IT NEEDS TO REALLY BE REPURPOSED, IN SOME CASES KNOCKED DOWN AND BULLDOZED. WHAT IS THAT REALLY WORTH WHEN PEOPLE ARE STILL WORKING AT HOME. LOT TO CONSIDER HERE. IT COMES AT AN INTERESTING TIME HERE, TOO, AS THE COMPANY HAS A NEW CEO COMING INTO THE MIX EARLY NEXT YEAR. >> IS THIS A PRE-TRANSITION REFERENDUM WE'RE ALREADY SEEING ON THE CONDENC COMING INTO THIS ROLE? >> I THINK THIS IS WHAT YOU WOULD NORMALLY HERE AN OPPORTUNISTIC OFFER. A COMPANY MAY BE FLAILING. KEEP IN MIND, MACY'S HAS DONE DREADFULLY THE PAST DECADE. A LOT OF THE EXECUTIVE TEAM HAS DONE A PRETTY TERRIBLE JOB. WHERE THEY HAVE DONE A GOOD JOB IS IMPROVING THE MERCHANDISE. MACY'S COULD PROBABLY CLOSE 300 MORE STORES TO BETTER OPERATE ITS BUSINESS. >> SOZZI WE'RE GOING TO CONTINUE THIS CONVERSATION THIS MORNING. THE PROPOSAL COMES AT AN INTERESTING TIME FOR THE RETAILER, SMACK-DAB IN THE MIDDLE OF THE CRITICAL HOLIDAY SEASON. WITH MORE, WE'RE JOINED BY DAVID SCHWARTZ, THE MORNINGSTAR SENIOR EQUITY ANALYST. IS THIS DEAL WORTH CONSIDERING? >> YES, I THINK . I THINK THERE'S A LOT OF RISK. YOU NEVER KNOW -- $21 IS KIND OF LOW. BUT YOU ALSO HAVE TO REMEMBER THAT MACY'S HAS $2.M MILLION IN NET DEBT. THE MODEL JUST DOESN'T WORK ANYMORE, SO IT IS IMPORTANT FOR MACY'S TO TAKE THIS OFFER SERIOUSLY. >> DAVID, DO YOU THINK THIS TYPE OF OFFER -- BECAUSE WE'RE SEEING SHARES -- DOES THIS UNLEASH -- LIKE A MACY'S, LIKE A NORTH STROM, NOW WE'RE GOING TO SEE THE BUYERS STEP UP IN HERE. >> IT'S VERY POSSIBLE. WE DID SEE KOHL'S GO THROUGH A POTENTIAL BUYOUT PROCESS A COUPLE YEARS AGO. IF YOU LOOK AT THE PRICE SINCE, IT'S FAR BELOW THE OFFERS THAT WERE DISCUSSED. YOU KNOW, I THIN POTENTIALLY THAT SOMEONE ELSE COULD GO AFTER KOHL'S AGAIN, BECAUSE I THINK IT IS QUITE UNDERVALUED. FOR NORDSTROM, IT IS A FAMILY RUN BUSINESS. THE FAMILY OWNS 30% OF THE COMPANY, SO I THI IS LESS LIKELY TO BE SOLD, BUT IT'S POSSIBLE IT COULD BE TAKEN PRIVATE. >> YOU MENTION THE FACT MAYBE THIS IS MORE OF A REAL ESTATE PLAY. IN TERMS OF ONE OF THE OTHER STRENGTHS THAT COULD MAKE MACY'S ATTRACTIVE TO BIDDERS, ITHER ANYTHING ELSE YOU HAVE ON YOUR RA RADAR? >> MACY'S DOES HAVE STRENGTHS. IT'S ONE OF THE LARGEST ONLINE TH COMPANY GETS VERY LITTLE CREDIT FOR THAT, BECAUSE PEOPLE STILL SEE IT AS A BRACK-AND-MORTAR, OTHER BUSINESSES INCLUDING BLOOM BLOOMINGDALE'S. IT HAS BEEN DOING PRETTY WELL RECENTLY, WHICH IS PART OF THE REASON WHY THE BLOOMINGDALE'S HEAD WILL BE THE CEO OF MACY'S PRETTY SOON, AND THEN YOU HAVE BLUE MERCURY. IT HAPPEN BEEN MEETING WHAT IT COULD BE, BUT I THINK IN THE FUTURE, IT DOES MEET WITH A LOT OF TRENDS THAT HAVE BEEN POWERING OTHER RETAILERS LIKE SEPHORA AND ULTA, SO I YOU THIS BLUE MERCURY IS ALSO INTERESTING. YOU LOOK AT MACY'S. IT HAS 40 MILLION SHOPPERS A WE'RE, MILLIONS OF CREDIT CARD HOLDERS. ITOES HAVE STRENGTHS THAT PEOPLE WOULD BE INTERESTED IN. >> UNFORTUNATELY BLUE MERCURY WAS PERHAPS ONE OF THE ONLY BRIGHT SPOTS ON THE COMP SALES PERSPECTIVE ON SOME OF THE DOWN SIDES. MACY'S COMP SALES DOWN 7.6%. THEN YOU TALKED ABOUT THE CREDIT CARDS. WE STARTED TO SEE DELINQUENCIES SHOW UP THERE AS WELL. WHAT'S THE LIKELIHOOD WITHOUT AN ACQUISITION THIS COMPANIES WE'VE COME TO KNOW MAKE IT THROUGH A RECESSION THAT SOME ARE FORECASTING LOOKING FOR A WILD RECESSION. >> MACY 'SURVIVED THE COVID PERIOD IN WHICH STORES ARE CLOSED, SO MY FEELING IS IF IT CAN SURVIVE A DISASTER LIKE THAT. IT CAN SURVIVE DISASTER, TOO. AT THE TIME I THOUGHT THAT MACY'S WOULD SURVIVE AND I STILL THINK IT WILL. THE COMPANY WILL NEVER BE A HUGELY PROFITABLE COMPANY, BECAUSE THAT'S WHY IT NEEDS TO SERIOUSLY CONSIDER THIS OFFERING. MACY'S DOESN'T SEEM TO HAVE A GREAT PLAN FOR ITS REAL ESTATE. IT'S BEEN UNDER PRESSURE FROM INVESTORS FOR YEARS TO MONETIZE THE REAL ESTATE. IT'S DONE SOME OF THAT. I THINK THI OFFER NEEDS TO BE CONSIDERED BECAUSE THE REALITY IS MACY'S WILL NEVER BE WHAT IT USED TO BE. >> ONE WRINKLE IN THIS DEAL THAT A SOURCE POINTED OUT TO ME IS THERE IS A WILLINGNESS TO RAISE THIS OFFER PRICE OF ABOUT $21 A SHARE EVEN HIGHER UPON DOING SOME DUE DILIGENCE. DO YOU THINK $25 GETS IT DONE, OR DO THEY NEED TO GET TO AROUND 30? >> MY ESTIMATE IS EASTERN $25. THINK A $25 OFFER IS FAIR. MACY'S MAY DEMAND MORE THAN THAT, AND YOU CERTAINLY COULD ARGUE THAT INVESTORS DESERVE A PREMIUM, BUT ANY OFFER ABOVE $25 IS CERTAINLY PROBABLY GOOD ENOUGH FOR SHAREHOLDERS, AND SO, I THINK THE INVESTORS HE LE THEMSELVES OPEN TO A HIGHER BID. THEY ARE WILLING TO RAISE IT. >> DAVID SCHWARTZ AND BRIAN SOZZI, THANK YOU SO MUCH. >>> EVERYONE, WE HAVE ALL YOU MA. STAY TUNED. YOU'RE WATCHING YAHOO FINANCE. >>> WE'RE JUST INSIDE OF FIVE MINUTES AWAY FROM THE OPENING BELL A WALL STREET. MADISON MILLS IS OVER AT THE NEW YORK STOCK EXCHANGE FOR A LOO AT WHAT'S MOVING. HEY, MADDIE. >> THANK YOU FOR HAVING ME THIS MORNING. THIS IS MY FIRST DAY AT THE STOCK EXCHANGE. I CAN'T GET AWAY FROM THE COMMENTS ABOUT MACY'S, MACY'S MACY'S. TO DO A BIT OF A MARKETS CHECK, THIS NAME WAS UP OVER 20% ON THE NEWS OF THE POTENTIAL ACQUISITION WHICH COULD TAKE THIS HUGE NAME PRIVATE TO THE TUNE OF $5.8 BILLION. IT'S UP ABOUT 15% THIS MORNING MEA MARKET. I ALSO JUST WANT TO TALK ABOUT SOME OTHER M&A NEWS. CIGNA AND HUMANA NOW SAYING THEY'RE NO LONGER PURSUING THE PERFORM. THE MARKET IS REWARDING THAT BECAUSE OF THE ANTITRUST CONCERNS WITH THE TWO VERY SIMILAR NAMES IN THE HEALTHCARE SPACE. GNA IS UP ABOUT 13% THIS MORNING. THIS COMES AFTER CIGNA HAS CRUSHED YEAR TO DATE OFF THIS POTENTIAL ACQUISITION. THEY WERE DOWN 10% THE DAY THAT THAT ACQUISITION WAS ANNOUNCED. SO SEEING A LOT OF MOVEMENT IN THE M&A SPACE AS WE HEADNTO THE END OF THE YEAR. >> MADDY, THOSE TICKETS ARE PRETTY STRONG GAINS AHEAD OF THE OPEN, BUT LET'S TALK MORE BROADLY SPEAKING THE MUTED REACTION -- OR MUTED ACTION AHEAD OF THE OPEN. WE HAVE A LOT OF IMPORTANT DATA COMING UP LATER THIS WEEK. >> THIS IS A BIG WEEK TO ECONOMIC NE, SO THERE'S GOING TO BE A LOT OF HESITATION. >> SHOWING THAT CONSUMERS SENIOR ACCEPTING THE IDEA THAT INFLATION MIGHT BE -- IN THAT FIGHT, RIGHT. BUT THIS MORNING A BIT OF HESITATION. SO WAITING THE BIG ECONOMIC DATA TO COME THIS WEEK. >>> DIGGING SOME THAT SAX, WE'RE SEE A SLIGHT MOVE, INDICATING WE'RE GOING TO OPEN IN NEGATIVE TERRITORY. BUT WE'VE A LOT OF STRONG WEEKS, A LOT ABOUT THE FED POTENTIALLY CHIMING IN. THE STREET A BIT MORE RESERVED IN SOME OF THEIR EXPECTATIONS WHEN WE TALK ABOUT A NEW GOLDMAN NOTE UNTIL THE SECOND HALF OF THE YEAR. BUT WHEN -- MADDIE WAS TALKING ABOUT A LOT OF EXCITEMENT AROUND THE M&A SPACE. AND I THINK A LOT OF THAT IS GOING TO BE DICTATED BY FED POLICY, THE BROADER INVESTMENT SENTIMENT, AND EXACTLY WHAT COMPANIES SEE AS STRATEGIC ALTERNATIVES HERE. AS WE GET TOWARDS THE LAST BIG TRADING SESSIONS, I WILL SA VOLU. LESS TRADERS WILL BE AT THEIR DESK, SO THERE COULD BE MORE VOLATILITY, BUT TYPICALLY WHAT WE'RE WATCHING FOR THIS WEEK AS WELL. >>> THE OPENING BELL JUST CREPT UP ON US. WE HAVE THE MAJOR AVERAGES HERE ON THE REEN THE DOW STARTS OFF BY ABOUT 0.1%, AND S&P 500 DOWN BY 0.1%, AND NASDAQ DOWN ABOUT A HALF PERCENT RIGHT NOW. >>> LET'S GET SOME MARKET COMMENTARY,OLDM SAC EXPECTING A COOLING OF INFLATION AHEAD. GOLDMAN NOW FORECASTING TWO CUTS FROM THE CENTRAL BANK. SO, AGAIN,HEY' MOVING UP THEIR EXPECTATIONS JUST A BIT ON THIS. THE REASON WHY THEY'RE SEEING SOME MORE PROGRESS HERE, CORE PCE COMING DOWN IN 2.5 RANGE, DOWN TO 2.2%, AND THEN FURTHER T IN TERMS OF THEIR EXPECTATIONS, THEY SEE CUTS, ANOTHER 100 BASIS POINTS OF CUTS IN 2026. I THINK THIS FURTHER ILLUSTRATES, WALL STREET SEEMS TO BE ALMOST ALL OVER THE MAP IN TERMS OF WHEN THE FED WILL CUT RATES. I DON'T THINK YOU CAN BLAME THEM, BUT A LOT OF THE ECON DATA HAS BEEN TOUGH TO -- AND FIGURE OUT EXACTLY WHAT THIS MEANS FOR THE FIGHT AGAINST INFLATION. >> YEAH. SOOW AT THIS POINT WE'RE HS AGO, LOOKING ON THE TO NEXT YEAR TO SEE WHERE AN ACTUAL CUT DOES TAKE PLACE. I PRINTED OUT THIS ONE SAY, SAVING PAPER, WHY NOT? WHAT I DID KNOWS SUGGESTIONS THAT INSURANCE CUTS ARE NOT IMMINENT. WAGE GROWTH STILL TOO HIGH. I DON'T THINK THAT RESPONSE TO A DECLINE IN INFLATION OR EITHER. SO, AT THE END OF THE DAY SYNTHESIZING WHAT THEY'RE SAYING HERE. THEY'RE LOOKING AT THE LABOR MARKET DAYS THAT SAID, OKAY, THAT'S STILL HOT. EVEN THOUGH THE FED IS GOING TO BE CONTINUING TO BE EXTREMELY AGGRESSIVE, PERHAPS, IN CUTTING OR FIGHTING INFLATION, THEY'RE STILL REVISING MUCH OF THEIR FED FORECAST TO REFLECT THE EARLIER START TO CUTS IN THE BASELINE FORECAST, GREATER SYMMETRY OF RISKS THEY'RE TALKING ABOUT TO THE DOWN SIDE HERE. WE'LL SEE WHO ULTIMATELY IS RIGHT WITH ALL THESE CALLS WE'RE SEEING. >> WE WILL SEE. NE SEVERAL MONTHS. US OVER THE >>> LET'S TALK ABOUT THE FACT THAT INVESTORS ARE LOOKING AHEAD TO KEY INFLATION DATA. OUR NEXT GUEST SAYING THAT THE NOVEMBER RALLY LEFT, QUOTE, WIDESPREAD OVERBOUGHT CONDITIONS IN THE S&P 500, BUT HE'S ALS WARNING THAT HISTORY SUGGESTS SHORT-TERM PAIN COULD BE AHEAD BEFORE LONG-TERM GAINS. IT'S GREAT TO SEE YOU HERE. YOU ARE A BIT OPTIMISTIC, BUT WHAT DOESHIS MEAN FOR INVESTORS AND THEIR POSITIONING GOING INTO THE NEW YEAR? >> I THINK IT REALLY MEANS THERE'S POTENTIAL FOR A BIT OF A PULLBACK. MAYBE SHORT-TERM PAIN. THE NARRATIVE IN THE MARKET HAS REALLY CHANGED. U'RE TALKING ABOUT INTEREST RATE CUTS INSTEAD OF INTEREST RATE HIKES. THE MARKET HAS GONE FROM A CORRECTION TO A COMEBACK. HUGE NOVEMBER RALLY, VERY BULLISH. IT DOESEN MEAN IT'S A BEARISH CALL, BUT WHEN YOU LOOK AT THE . WE HAD BROUGHT-BASED BUYING IN NOVEMBER, A SIZABLE ALMOST 9% RALLY IN THE S&P 500. THAT CREATED VERY OVERBOUGHT CONDITIONS HISTORICALLY. SO WE HAVE ABOUT A THIRD OF THE S&P 500 ACTUALLY REACH OVERBOUGHT CONDITIONS BASED ON A LOOK AT. THAT'S EXTREMELY RARE. BACK TO 199 ON IT'S ONLY OCCURRED 1% OF THE TIME. THE MARKET IS TYPICALLY, WE'LL MOHS.IT FLAT OVER THE NEXT THREE LONGER TERM, AND I THINK THIS IS WHERE INVESTORS SHOULD BE FOCUSED, 12 MONTHS LATER JUST OVER 12%, ONLY ONE HAD A NEGATIVE RETURN AS WELL. SO WE DO THINK THERE'S A PRETTY GOOD POSITIVE READ THROUGH INTO 2024 BASED ON THAT DATA. HEN YOU HEAR CALLS ON THE STREET PULSE FORWARD SOME OF THEIR ESTIMATIONS FOR A CUT IN FED POLICY, DOES THAT SIGNAL TO YOU PERHAPS WE'RE MORE IMMINENT TO A MILD OR -- SHALLOW ORILD RECESSION? THAT WOULD PERHAPS SUBJECT THE FED SEES SOMETHING DIRE THAT IT ACTUALLY NEEDS TO CUT. >> THAT'S THE KEY QUESTION. WE'VE SEEN RATE CUTS GET PULLED FORWARD, AND WE HAVE TO ASK OURSELVES WHY, AND WHY ARE WE PRICING IN INTEREST RATE CUTS. IS IT BECAUSE RECESSION IS MORE IMMINENT THAN EXPECTATIONS? OR IS IT A VICTORY LAP ON INFLATION? I THINK WE'LL GET A PRETTY GOOD WEEK, AND I THINK RIGHT NOW, THOUGH, THE MARKET IS GIVING THE ECONOMY THE BENEFIT OF THE DOUBT. WE'RE IN THIS GOLDILOCKS SCENARIO. FOR NOW THAT SEEMS TO BE OKAY FOR THE MAET. >> WHEN WE LOOK AHEAD TO NEXT YEAR, SOME OF THAT LEADERSHIP THAT WE SHOULD BY EXPECTING, WE'RE STARTING TO SEE MORE BROADENING OUT, SYSTEM SOMETHING THAT YOU SEE TRENDING TO THE UP SIDE? IN TERMS OF THAT OUTPERFORMANCE, WHOO YOU SEE IN THOSE LEADERSHIP POSITIONS? >> WE THINK COMMUNICATION SERVICES IS FIRE ON ALL CYLINDERS. TECHNICALLY WE JUST HAD A BREAKOUT ON COMMUNICATION SERVICES, SO WE THINK THERE'S UP SIDE THER THEN ON THE FUNDAMENTALS, WITHIN COMMUNICATION SERVICES, JUST REPORTED A GREAT THIRD QUARTER EARNINGS, CALENDAR YEAR 2024, YOU'RE LOOKING AT EXPECTATIONS FOR ABOUT 17% EARNINGS GROWTH FOR THAT SECTOR, REVENUE GROWING AS WELL, AND THIS IS NOT JUST A MEGACAP STORY WITHIN THE SECTOR, THIS IS BROAD BASE D RIGHT NOW T A STYLE LEFT, WE'RE SEEING THE GROWTH SECTOR OR MEGACAP NAMES LEADING THE WAY. WE'RE STARTING TO SEE -- THEY HAVE NOT, FOR MOST OF THIS BULL MARKET. >> OF COURSE, COMMUNICATE SERVICES HAVE BEEN A CONSISTENT OUTPERFORMER. >> AND WE DEVOTE A CASE LAST WEEK OF THE MARKETS HEARING WHAT THEY WANTED TO HEAR, AND REALLY THINK ABOUT THE DATE ON THE JOB FRONT. WHERE ARE THE STRONGEST AREAS, IF THERE'S GOING TO BE MORE OF, YOU KNOW, WE'LL JUST SHRUG OFF THE DATE WE DON'T LIKE TO HEAR? OF COURSE, FINANCIALS WERE A -- SORE THAT'S AN HEAR WE'RE NEUTRAL ON. WE LIKE ENERGY AS WELL. WE THINK THERE'S SCOPE FOR A RELIEF RALLY, THE SECTOR IS TRADING CHEAP, OIL LOOKS LIKE IT'S GETTING CLOSE TO A BOTTOM HERE, IN TERMS OF SOME SUPPORT LEVELS WE ARE WATCHING, GETTING PRETTY WASHED OUT. SO THAT'S ANOTHER AREA TO FOCUS ON. >> ADAM, THANKS SO MUCH. WE APPRECIATE IT. >> THANKS. >> ABSOLUTELY. >>> WELL, CIGNA IS CALLING OFF ITS ACQUISITION OF HUMANA. THE TWO HEALTH INSURANCE COMPANIES COULDN'T AGREE ON A PRICE, ACCORDING TO SEVERAL REPORTS. CIGNA NOW PLANNING TO SPEND ABOUT $10 BILLION ON A STOCK BUYBACK. ANJALEE KHEMLANI IS HERE WITH US IN STUDIO. HEY. >> HEARTBREAK FOR THIS DEAL? MAYBE NOT SO MUCH. WE SAW THE STREET NEGATIVELY RESPOND LAST WEEK THAT THERE COULD BE TALKS. WE DO NOWNOW THAT THEY ARE FALLING APART. WE DID GET SOME OF THE POSITIVES FOR CIGNA WITH A STOCK BUYBACK. LISA GILL SAYING WE ARE POSITIVE ON THE NEAR-TERM OUTLOOK FOLLOWING STRONG Q3 RESULTS, AND BELIEVE A SOL FUNDAMENTAL SIDE HEADING INTO 2024. THAT SEEMS TO BE SORT OF THE SENTIMENT FOR ALL THE ANALYSTS. HUMANA HAS BEEN LOOKING FOR SEVERAL YEARS, WE KNOW, FOR A BUYER. OVER TIME WE SAW DEALS FALL THROUGH ABOUT A DECADE AGO. THE TWO HAD BEEN TALKING THEN. SO THIS WAS THE SECOND GO-AROUND FOR THE TWO TO POTENTIALLY PARTNER UP. SO WHILE PRICE AND TERMS HAD BEEN PART OF THE BREAKUP. WHAT THAT LONG-TERM DRAG COULD HAVE BEEN. >> SO HEARING ABOUT WHAT THE TIMELINE COULD HAVE TALKED ABOUT, ABOUT WHETHER OR NOT THIS WOULD HAVE BEEN -- >> 12 MONTHS OR MORE. SO, YOU KNOW, LEADING UP TO TWO YEARS. AND THAT MEANS SOMETHING THAT COULD HAVE STARTED NOW PUT A LOT OF PRESSURE ON THE COMPANIES FOR SOME TIME. CIGNA WOULD HAVE BENEFITED FROM THIS SO, YOU KNOW, THERE WERE PIECES ABOUT IT GOOD LOOK ON PAPER, BUT THELY NOT A DEAL THAT WILL GO THROUGH. >> THANK YOU FOR BREAKING THAT DOWN FOR US. >>> OCCIDENTAL PETROLEUM IS BUYING CROWN ROCK. IT'S AASH D STK DEAL. IT IS EXPECTED TO CLOSE IN THE FIRST OF 2024 IT'S A MAJOR EXPLORE ACOMPANY, AND THIS COMES AFTER SEVERAL ENERGY, ONE MAJOR DEBIG EXXON BUY ING A NUMBER OF THESE COMPANIES FLUSH THIS CASH IN A STRONG POSITION. THEY'RE UNDER A TREMENDOUS AROUND OF PRESSURE. THEY'RE THOOG THE MOST OPPORTUNISTIC IS TO GOUT AND DO M&A. THAT'S GOING TO GIVE THEM MORE EXPOSURE TO SOME OF DRILLING SITES. >> YEAH, SOME OF THE HIGHLIGHTS THAT THE COMPANIES ARE CALLING OUT HERE, THEY'RE EXPECTING ON THE FINANCIAL FRONT DELIVER INCREASED FREE CASH FLOW ON A DILUTED SHARE BAS, ILUDING A BILLION IN THE FIRST YEAR. ADDITION OF 170 MILLION BARRELS A DAY, UNCONVENTIONAL PRODUCTS IN 2024, AS WELL AS APPROXIMATELY 1700 UNDEVELOPED LOCATIONS, AND THEN ALSO INCREASING SOME THE BREAK-EVEN 33% HERE. SO THIS IS A GROWING OF THE LOCATION APPEARED ACREAGE, A GROWING OUT OF EVEN THE DIVIDEND THEY'LL BE PAYING OUT HERE. THE COMPANIES HAD MENTIONED THIS IS SUPPORTING A QUARTERLY TO 22 CENTS A SHARE HERE. 22% >> SOMETHING YOU THINK WILL KEEP THE SHAREHOLDERS HAPPY, AT LEAST TO THIS POINT. SEW IF THE STREET ISIGHT- KEEP IT RIGHT HERE ON YAHOO FINANCE. WE ARE MORE OF YOUR MARKET ACTION AHEAD. WE'LL BE RIGHT BACK. >>> THE FDA APPROVED THE FIRST GENE THERAPIES TO TREAT SICKLE CELL DISEASE, INCLUDING THE FIRST GENE EDITING TREATMENT. WHILE THIS TECHNOLOGY BEHIND BOTH TREATMENTS IS GROUNDBREAKING, THE LOGISTIC, ALSO THE SKY-HIGH PRICES WILL LIKELY LIMIT SOME ACCESS. WE WANT TO BRING IN DAVID NEARINGGUARD, WEDBUSH MANAGING DIRECTOR OF EQUITY RESEARCH. LET'S TAKE A STEP BACK AND TALK TO US ABOUT THE LANDMARK DECISION AND HOW SIGNIFICANT IT IS IN TERMS OF MAKING TREATMENT AVAILABLE, AND ABLE TO STREET SOME ISSUES THAT HAVEN'T BEEN POSSIBLE IN THE PAST. >> IT'S A REAL TECHNICAL PRODUCTS APPROVED. THINKS FIST GENE THERAPY AND GENE EDITING PRODUCTS FOR SICKLE CELL DISEASE. IT'S BEEN A LONG TIME COMING, SO, YOU KNOW, THERE'S DEFINITELY A BUNCH OF STOPS AND STARTS ALONG THE WAY, BUT A TECHNICAL ACHIEVEMENT FOR THESE COMPANIES AND A VICTORY FOR PATIENTS WHO REALLY, WITH THE SEVERE FORM OF THIS DISEASE ARE REALLY SUFFERING. >> AND NO DOUBT SCIENTIFIC BREAKTHROUGHS AND DISCOVERIES HERE, THE COMPANIES SWIFTLY MOVE TOWARD HOW DO WE GET THIS IN THE MARKET AND HOW DO WE ADVANCE WHAT WE'VE DEVELOPED AROUND HERE. HO DOE THAT CHANGE THE COMPANY PROFILE FROM YOUR PERSPECTIVE? >> THAT'S THE REAL CHALLENGE GOING FORWARD. YOU MENTIONED THE PRICE. I THINK THERE ARE GOING TO BE DISCOUNT HERE THAT NOT BE THE TRUE NET PRICE THAT EY MPANIES REALIZE, BUT A BIG ARE CHALLENGE FOR GETTING ACCESS TO THIS TECHNOLOGY IS THE PROCESS INVOLVED WITH THIS. THE PATIENTS ARE ESSENTIALLY UNDERGOING A BONE MARROW TRANSPLANT. IS REQUIRES THEM TO SPEND SEVERAL MONTHS PREPARING FOR THE PROCEDURE, AND THEN FOUR TO SIX WEEKS IN THE HOSPITAL. AS YOU CAN IMAGINE THAT'S VERY DIFFICULT FOR A LOT OF PEOPLE TO STOMACH AND THAT IS THE REAL CHALLENGE HERE, IS TRYING TO MARKET THIS TECHNOLOGY IN THE FACE OF THIS RELATIVELY CHALLENGING PROCEDURE. I THINK IT WILL BE LIMITED TO THE MOST SEVERE OF THESE SICKLE CELL PATIENTS, BUT AGAIN, FOR ITAN PVIDE A LIFELONG CURE. HIS, >> THERE'S CLEARLY A PERCENAGE FOR PATIENTS TO TRY IF IT MAKES THE MOST SENSE, TO HAVE ACCESS TO THE DRUGS. WHEN YOU TAKE A MORE LONGER-TERM VIEW, TEN YEARS FROM NOW, WHAT DOES IT LOOKS LIKE FROM AT LEAST WHERE YOU STAND TODAY? >> HONESTLY, LOW SINGLE DIGIT PERCENTAGES. I THINK THAT'S THE CEILING THAT PATIENTS ARE SEVERE ENOUGH THAT THEY WOULD UNDERGO THIS PROVIDERS, BUT THEY'RE IN TRULY BAD SHAPE PATIENTS STROKE, HEART ATTACK, NEVER MIND THE EXCRUCIATING PAIN WHEN THEY DO HAVE CRISES GOING TO THE HOSPITAL FOR MULTIPLE DAYS, YOU KN,O TREAT THE PAIN AND OTHER EFFECTS FROM THE DISEASE. SO, FOR THOSE PATIENTS IT'S GOING TO BE TRULY TRANSFORMATIVE, BUT IT'S A SMALL PERCENTAGE OF PATIENTS, IN MY PIN. >> I'VE HEARD SLAW, IN PART BECAUSE OF ACCESS ISSUES, IN RMS LOCATION, IN TERMS OF THE PRICE POINT. YOU KNOW, WHEN IT COMES TO THE FACT THERE'S SOMETHING NEW, IS THAT SURPRISING IN ANY WAY? >> I THINK IT'S -- WHEN YOU NOT SURPRISING. PROCEDURE, IT'S I THINK IF THIS WERE A SHORTER PROCEDURE, IF IT ONLY TOOK A FEW DAYS IN THE HOSPITAL, YOU KNOW, IF THERE WERE OTHER AMIR YORRATIYORRATE ING -- AMELIORATING FACTOR, IT'S THE PROCEDURE, THE TIME IT TAKES TO DO IT, AND THE DIFFICULTIES INVOLVED WITH IT. YOU NEED ESSENTIAL A BON MARROW TRANSPLANT SITE. MANY OF THE SITES THAT THE COMPANIES RAN THEIR CLINICAL TRIALS IN FRANKLY HAVE LOW POPULATIONS OF -- AND THEY NEED TO EXPAND SITES, IN MY OPINION, TO OTHER AREAS OF THE COUNTRY THAT HAVE MORE PATIENTS LOCALLY. >> AND WE SAW BLUEBIRD GET HIT NEGATIVELY BECAUSE OF THE LABEL. WE KNOW THAT VERTEX AND KRISPR WILL HAVE LONG-TERM STUDIES. >> THAT'S PART OF THE CONCERNS. BLOOMBERG HAD A BLACKS BOX WARNING, WITH THE RISK OF SECRETARY CANCERS AFTER THE PROCEDURE IS COMPLETED, AND THAT IS A REAL RISK. THERE'S ALSO AN ASSUMED REAL RISK FOR INCREASED CANCERS, THOUGH IT'S NOT IN THE LABEL FOR THE GENE EDITING PRODUCT A BLACK BOX, BUT THOSE ARE LONGER-TERM QUESTIONS. FRANKLY, AGAIN. IN THE MOST SEVERE PATIENTS, LIFESPAN IS SHORTENED TO 30 TO 40 YEARS IN MANY PATIENTS, SO SECONDARY CANCER IS PROBABLY LESS OF A CONCERN, BUT LONGER-TERM PATIENTS DO HAVE FERTILITY ISSUES, USUALLY THEY BECOME INFERTILE AFTER THIS TREATMENT AND SUCH, SO, AGAIN, THAT'S GOING TO LIMIT SOME OF THE PATIENTS WILLING TO DO THE PROCEDURE. >> IF WE WOULD COMPARE THIS TO SOME OF THE OTHER PROCEDURES, MESSENGER RNA COMES TO MIND, THIS IS THE TYPE OF MESSENGER RNA MULTIPLIER THAT WE COULD SEE, THAT WILL MOVE -- AND SOLUTIONS THAT THEY'RE BRINGING TO MARKET? >> YES, ABSOLUTELY. WHAT'S IMPORTANT HERE FROM A VIEWPOINT IS THE FDA DID APPROVE THESE PRODUCTS. THE FDA IS NOW OFFICIALLY COMFORTABLE WITH GENE THERAPIES, GENE EDITING IN MY OPINION, AND THIS WOULD LEAVE CATALYZE TREATMENTS THAT DON'T REMEMBER, ESSENTIALLY A TRSPLAED TO DELIVER THE GENE THERAPY, OR THE GENE EDITING. I THINK THAT WILL PROBABLY A TAILWIND FOR MANY OF THESE STOCKS IN THE MERE, MEDIUM TERM FOR THE DEVELOPMENT OF THEIR PRODUCTS. DAVID NEARENGUARD, AND ANJALEE KHEMLANI, THANK YOU BOTH. >>> WE'RE ALSO TRACKING JPMORGAN HERE. THE WARNING OF ROCKY CIRCUMSTANCES FOR U.S. STOCKS NEXT YEAR. THEY CAUTIONED CLIENTS, SAYING A RALLY OF STOCK EXCHANGE ISN'T SUSTAINABLE WITHOUT CUTS BY THE FED. SO THIS IS AMONG THE RANGE OF STRATEGYING THAT WE HAD HEARD EMERGE, AND MUCH OF THAT REALLY JUST POSITIONED AROUND WHAT THE FED MAY OR MAY NOT DO AT THIS POINT. >> I THINK IT ALL HINGES ON WHAT THE FED WILL DO. WE KNOW HE TENDS TO BE BEARISH IN TERMS OF HIS EXPECTATIONS, D A COUPLE SCENARIOS THAT HE DID LAY OUT STOOD OUT TO ME. HE ONLY SEES EQUITIES OUTPERFORMING BONDS AND CASH BY ONLY ABOUT 5%. NOW, IN HIS EXPECTED ENVIRONMENT OF DECLINING GROWTH OR RECESSION, HE'S SING THIS GROUP COULD ACTUALLY PERFORM CASH BY 20%. THE MARKET VERYOPTISTIC MAYBE A BIT TOO AGGRESSIVE IN PRICING, AND THAT THEY SEE ONE ALMOST AS EARLY AS THE FIRST QUARTER, MARCH NEXT YEAR, AND WHEN YOU COMPARE THAT TO SOME OF THE MORE RESERVED EXPECTATIONS, THERE'S A WIDE VARIETY OF WHEN THAT TIMELINE WILL BE. CE THE FED DOES START CUTTING, HOW QUICKLY THEY WILL CONTINUE TO CUT IS OBVIOUSLY UP FOR DEBATE. >> AND WHEN YOU'RE TAKING SOME OF THE RISKIER ASSETS OFF THE TABLE, DOES THAT LEAN INTO A REVERSION TYPE OF STRATEGY? THAT'S SOMETHING WE'VE HEARD WHEN WE'VE BEEN ASKING FOR SOME OF THE STRATEGISTS' END OF THE YEAR FORECASTS. >>> THERE'S A LOT MORE TO GO HERE. WE'RE ONLY AN HOUR INTO THE SHOW. THAT'S A LONG TIME IN NEWS, SO IMAGINE HOW MUCH A YEAR IS. IT'S COMPILE A LIST OF THE TOP STORIES, BUT SOMEHOW WE DID IT. INFLATION WAS STILL AN ISSUES, THE FTX FALLOUT CONTINUES TO CRUMBLE. AND ONE OF THE BIG BOX OFFICE SMASHES, AND TAYLOR SWIFT SINGING ALL THE WHILE. >> WAS SHE NUMBER ONE? DID SHE MAKE THE LIST AT ALL? WHAT ABOUT THE REGIONAL BANKING CRISIS? IT FEELS LIKE 100 YEARS AGO, BUT IT WAS SOME MARCH, TUNE INTO OUR . THAT'S ALL FROM TODAY. YOU'RE WATCHING YAHOO FINANCE. >>> HOW DO WE REIMAGINE OUR RETIREMENT WITHOUT RELYING ON SOCIAL SECURITY? >> SOMEHOW WE NEED TO REVERSE THE BRAGGING RIGHTS. THE BRAGGING RIGHTS TODAY IS, I OWN A NICE CAR, VERSUS I HAVE A LARGE 401(k) ACCOUNT. >> NEVER, EVER, EVER WILL SOCIAL SECURITY BE ELIMINATED. POLITICALLY AND ECONOMICALLY, THE CASE IS VERY, VERY STRONG. >>> THE CLOCKS TICKING. IF YOU PLAN ON RELYING ON SOCIAL SECURITY TO PAY YOUR BILLS IN RETIREMENT, THINK AGAIN. IN 2022, 58 MILLION PEOPLE WERE ELIGIBLE FOR SOCIAL SECURITY. THAT NUMBER EXPECTED TO JUMP TO 75 MILLION BY 2035 WITH THE RESERVES EXPECTED TO RUN OUT BY 2033. SO, HOW DO WE REIMAGINE AND FUTURE-PROOF OUR RETIREMENT WITHOUT RELYING ON SOCIAL SECURITY? BOB, I WANT TO START WITH YOU. FOR ALMOST 90 YEARS, AMERICANS HAVE BEEN ABLE TO RELY ON SOCIAL SECURITY AS AT LEAST PART OF THEIR RETIREMENT. BUT ONCE THE RESERVES DO RUN OUT, WILL FUTURE GENERATIONS BE ABLE TO RELY ON SOCIAL SECURITY? WILL IT HAVE THE SAME IMPACT? >> WELL, IT'S A HARD QUESTION TO ANSWER BECAUSE WE DON'T KNOW YET WHETHER CONGRESS WILL ACT TO RESCUE SOCIAL SECURITY. IF IT DOESN'T ACT BY 2033, SOCIAL SECURITY WILL ONLY BE ABLE TO PAY OUT 8%F SCHEDULED BENEFITS. RIGHT NOW, IF WE LOOK AT SOCIAL SECURITY, IT REPRESENTS 85% OF RETIREMENT INCOME FOR THOSE IN THE LOWEST INCOME QUINTILE. IF THERE IS ANY ASKRESCUE TO CO IT MAY NOT AFFECT THE OLDT A THE POOREST. IT'S MORE LIKELY TO AFFECT THOSE WHO ARE 40 AND YOUNGER IN TERMS OF EITHER INCREASED TAXES OR LOWER BENEFITS OR A COMBINATION THEREOF. >> SO, AS WE TRY TO IMAGINE WHAT A FUTURE LOOKS LIKE WITHOUT SOCIAL SECURITY, DO YOU THINK THERE EVER WILL BE A TIME WHEN SOCIAL SECURITY WILL BE ELIMINATED? WHERDO Y SEEHIS HEADED? >> NEVER, EVER, EVER WILL SOCIAL SECURITY BE ELIMINATED. THE POLITICS FOR SOCIAL SECURITY ARE JUST WAY TOO STRONG. DEMOCRATS WANT THE BENEFITS NOT TO BE CUT. REPUBLICANS WANT THE BENEFITS NOT TO BE CUT. SO, THE POLITICAL REALITY IS AT SIAL SECURITY WILL BE THERE, AND THE ECONOMIC CASE FOR SOCIAL SECURITY CAN, YOU KNOW, HAS NEVER BEEN STRONGER. SOCIAL SECURITY IS SUPPOSED TO COMPLEMENT A VOLUNTARY SAVINGS OR A PENSION SYSTEM, AND ON TOP OF THAT, HOME OWNERSHIP. IT WAS ALWAYS SUPPOSED TO BE AROU 40% OF MIDDLE CLASS RETIREES' INCOME. FOR LOWER INCOME PEOPLE, THEY RELY ALMOST ALL ON SOCIAL SECURITY, AND FOR THE TOP, THAT'S LIKE PIN MONEY. BUT FOR THE MIDDLE CLASS, IT WAS ALWAYS SPOSETO SPLEMT. BUT IN THE PAST 20 YEARS, THAT PRIVATE SECTOR, NO OFFENSE, SYSTEM HAS NOT FILLED IN WHAT SOCIAL SECURITY HAS PROVIDED. SO, OVER THE PAST 20 YEARS, SOCIAL SECURITY HAS GOTTEN MORE IMPORTANT FOR RETIREES. SO, POLITICALLY AND ECONOMICALLY, THE CASE IS VERY, VERY STRONG FOR SOCIAL SECURITY. >> I WANT TO BRING YOU IN HERE, BECAUSE WHEN YOU FACTOR IN, THEN, ALSO INFLATION AND JOB SECURITY INTO THE RETIREMENT SAVINGS PICTURE, HOW DOES THIS COMPLICATE THINGS? >> YEAH, THIS IS A -- I REALLY APPRECIATED BOB AND TERESA'S POINTS HERE, BUT LET'S NOT JUST GO WHY SOCIAL SECURITY IS AS IMPORTANT AS IT IS. THERE'S MARKETERS, OF COURSE. AS YOU MENTIONED, INFLATION RISK. LET ME ADD TWO OTHERS. THERE'S LONGEVITY RISK PEOPLE ARE TAKING ON, AND INSIDE THAT, WHAT I MIGHT CALL COGNITIVE RISK. SO, I SAW ON THE NEW ENGLAND CHAPTER OF THE ALZHEIMER'S ASSOCIATION AND HAVE LEARNED THERE THAT WHEN YOU GET TO AGE 85, THE CASES OF GETTING DEEP DEMENTIA OR ALZHEIMER'S DISEASE IS ONE IN THREE. SO, WE'RE LIVING LONGER, SO WE NEED INCOME THAT'S GOING TO SUPPORT US TO ADDRESS ALL THESE RISKS, AND WHEN WE LOOK AT DATA AT THE INSTITUTE WHAT KIND OF INCOME ARE PEOPLE GETTING FROM SOCIAL SECURITY, LIKE AFRICAN AMERICANS, HISPANIC, LATINOS ARE EVER RELIANT ON THIS, BUT GUESS WHAT? THEIR INCOME IS LOWER COMPARED TO OTHER DEMOGRAPHIC GROUPS. SO, THIS IS A VERY VITAL QUESTION YOU'RE BRINGING UP. >> AND SO, THEN, WHEN YOU THINK IMCTED, YOU MENTIONED, OF ST COURSE, MINORITIES AND THOSE OF LOWER INCOME ARE GOING TO BE MOST AFFECTED. BUT WHEN YOU LOOK AT MILLENNIALS AND ZENNIALS WHO ARE ALSO GOING TO BE THE MOST IMPACTED, WHAT SHOULD THEY BE DOING NOW TO BOLSTER THEIR SAVINGS ON THE CHANCE THEY WON'T BE ABLE TO RELY ON SOCIAL SECURITY? >> LET ME GIVE YOU, BED ON MY EXPERIENCE WITH YOUNG ADULTS COMING IN AS SOMEONE WHO TURNS INTO OUR COMPANY OR JOINING AS NEW ANALYSTS, OF COURSE, IF YOU TALK TO THEM ABOUT, SAVE MORE MONEY OR GET YOUR EMPLOYER MATCH AND ALL THESE MONEY TERMS, IT COULD BE A TURNOFF. IT COULD BE LIKE AN "EAT YOUR SPINACH" MESSAGE. I'VE TRIED TO FRAME IT IN TERMS OF, HEY, YOU MIGHT BE EXPECTED TO HAVE HUNDRED-YEAR LIVES, AND COMPARED TO YOUR GRANDPARENTS' GENERATION, YOU HAVE BEEN ACCORDED A LONGEVITY BONUS OF 17 YEARS, 20 YEARS, 25 YEARS. HOW ARE YOU GOING TO SPEND IT? THAT GETS THEIR ATTENTION. NOW, FINANCES BECOME A MEANS TO FACILITATE THAT HUNDRED-YEAR LIFE. >> THAT'S A REALLY GOOD POINT. WHEN YOU HAVE TO DO IS IMAGINE THEIR FUTURE SELF, HAV THEM EMPATHIZE WITH THEIR FUTURE SELF, HAVE THEM IMAGINE TRIPS THEY WILL TAKE WITH THEIR FUTURE SELVES, AND THEN THEY HAVE A MOTIVE TO SAVE BECAUSE THE MOTIVE IS REALLY TO SPEND. >> CORRECT. >> WE ALL ARE HUMANS THAT ARE MOTIVATED TO ACTUALLY CONSUME AND HAVE FUN. >> AND SOMEHOW, WE NEED TO REVEE RIGHT? THE BRAGGING RIGHTS TODAY IS, I OWN A NICE CAR VERSUS, I HAVE A LARGE 401(k) ACCOUNT. >> AND I THINK THIS GENERATION IS MUCH MORE LIKELY TO BRANDISH THEIR ACCOUNTS, BECAUSE THIS GENERATION IS MUCH MORE FINANCIAR PREVIOUS GENERATION. THEY HAVE HAD TO GROW UP FAST BECAUSE WE SADDLED THEM WITH STUDENT DEBT. >> IT'S ALSO MORE COMPLICATED IN THE SENSE THAT WE DIDN'T HAVE AN HSA WHEN WE ENTERED THE TH NEE FOR THEM TO BE NOT ONLY KNOWLEDGEABLE BUT EXPERTS IN HOW BEST TO SAVE FOR THAT LONG EVENTY BONUS. >> WE'VE TURNED FINANCIAL PLANNING INTO A DO-IT-YOURSELF AFFAIR, AS IF WE NOW TOLD A YOUNGER GENERATION, NOW YOU HAVE TO DO YOUR OWN DENTISTRY. IT'S LIKE, THE SYSTEM THE NOT REALLY BUILT TO BE THIS COMPLICATED FOR PEOPLE, AND MOST NATIONS DON'T DO IT THE WAY WE DO IT. >> A BIG THANKS TO OUR VERY OWN RACHELLE AKUFFO FOR BRINGING US THAT INTERVIEW, AND SOME REALLY GREAT ARGUMENTS MADE FROM OUR PA PANELISTS THERE, AND NATURALLY, I THINK ABOUT SOME OF THE BIGGEST COMPANIESHAT E S TO BE IMPACTED IF WE WERE TO SEE A SIGNIFICANT SHIFT IN THE EITHER AMOUNT PEOPLE ARE SAVING FOR RETIREMENT OR HOW THEY'RE SAVING FOR RETIREMENT, THE VEHICLES THEY'RE USING OR THE ASSETS THEY'RE INVESTING INTO AS WELL HERE AND KIND OF USING AS THEIR GOLDEN EGG THAT THEY CAN JUST KIND OF PUT OFF TO THE SID AND CONTINUE BUILDING AROUND HERE. BUT MOST NOTABLY, THE BANKS IMMEDIATELY COME TO MIND, AND THOSE THAT HAVE THE LARGEST RETIREMENT OR WEALTH MANAGEMENT UNDER THEIR ASSETS UNDER MANAGEMENT AND THEIR PLANNING AS WELL AND I THINK THAT'S ONE AREA WHERE IF THERE ARE INVESTORS OUT THERE THAT ARE TRYING TO FIGURE OUT HOW TY CA POTENTIALLY PLAY THIS BROADER RETIREMENT SPACE, THE BANKS COME TO MIND. YOU'VE GOT CHARLES SCHWAB AND SOME OF THE LARGER TRADING FIRMS AS WELL THAT ALSO COME TO MIND HERE TOO. >> YOU ALSO HAVE FIDELITY, VANGUARD AND THE LIST GOES ON IN TERMS OF WHERE THESE INVESTORS POTENTIALLY ARE ALLOCATING SOME OF THEIR FUTURE RETURNS HERE WH IT MESO SAVING FOR RETIREMENT, AND I THINK THE RESOUNDING TAKEAWAY FROM ALL THIS IS, ONE, IT'S NEVER TOO EARLY TO START PLANNING. TWO, YOU CAN NEVER BANK ON SOMETHING ELSE HAPPENING THAT'S OUTSIDE OF YOUR CONTROL. FOR THIS INSTANCE, IT'S SOCIAL SECURITY. EXACTLY WHAT THAT'S GOING TO LOOK LIKE DECADES FROM NOW, THE ESTIMATES ARE ALL OVER THE MAP FOR HOW QUICKLY IT UL POTENTIALLY RUN OUT AND WHAT NEEDS TO HAPPEN IN TERMS OF SOCIAL SECURITY REFORM. A LOT OF THAT ALSO HINGES ON WHO IS IN THE WHITE HOUSE AND WHO'S DOMINATING SOME OF THESE PARTIES HERE WITHIN CONGRESS. SO, I THINK WHEN THERE ARE SO MUCH UNKNOWN -- SO MANY UNKNOWNS OUT THERE, IT IS IMPORTANT TO TAKE CONTROL OF YOUR OWN FINANCIAL DESTINY. A LOT OF THAT HAS TO DO WITTHE CT THAT YOU NEED TO START SAVING EARLY, START ALLOCATING SOME OF YOUR INCOME TO 401(k)'S IF YOU DO HAVE THAT AS AN ALTERNATIVE AND CAPITALIZE ON THE FACT THAT MANY OF YOUR COMPANIES ARE MATCHING UP TO A CERTAIN PERCENTAGE POINT. IF YOU'RE DOING ALL OF THAT EARLY, PREPARING FOR WHAT COULD BE DECADES AWAY, THEN YOU WOULD AT LEAST BE IN BETTER SHAPE THAN YOU WOULD HAVE BEEN IF YOU DIDN'T START PLANNING TO YOUR 40s, 50s, OR GOD FORBID YOUR 60 PIAZZA. >> I'M TRYING TO RETIRE BY 40. >> YOU NEVER KNOW. GOT TO BE VERY, VERY SMART. MAKE A HECK OF A LOT OF MONEY IF YOU WANT IT TO LAST ALL THE WAY THROUGH IF YOU'RE RETIRING AT 40. >>> KEEP IT RIGHT HERE ON YAHOO! FINANCE. WE'LL BE RIGHT BACK. >>> NOVO NORDISK BECAME EUROPE'S MOST VALUABLE COMPANY THIS YEAR THANKS TO OZEMPIC AND WEGOVY. IT'S NO SURPRISE WE NAMED THE DANISH PHARMACEUTICAL COMPANY GIANT OUR COMPANY OF THE YEAR FOR 2023. ANJALEE KHEMLANI WAS ABLE TO SIT DOWN WITH THE CEO. LET'S TAKE A LISTEN. >> IS OBVIOUSLY A GREAT HONOR TO GET THAT PRESTIGIOUS PRIZE, AND IN MANY WAYS, IT'S A GOOD PICTURE OF A FANTASTIC YEAR FOR NOVONORTIS. ALL BASED ON SOME INTERESTING AND FASCINATING INNOVATION WE'VE BEEN DOING FOR MANY YEARS, SO WE'RE PLEASED TO BE IN THIS WONDERFUL SPOT. >> ABSOLUTELY. AND THIS IS, OF COURSE, BECAUSE OF OZEMPIC, WEGOVY, THE GLP-1 PRODUCTS THAT HAVE HAD ASTODING FOR PEOPLE. IT'S FUNNY TO ME BECAUSE, YOU KNOW, OZEMPIC WAS APPROVED IN 2017. WEGOVY, IN 2021. ARE YOU SURPRISED BY THE FACT THAT A COUPLE YEARS AFTER OR SEVERAL YEARS AFTER THIS APPROVAL, YOU'RE SUDDENLY SEEING THIS DELAYED SUCCESS? >> IT'S A GREAT QUESTION, BECAUSE WE HAVE BEEN RESEARCHING IN THIS FOR MANY DECADES. WE HAVE DONE RESEARCH FOR MORE THAN 25 YEARS. WE HAVE ALL LONG FELT THAT THERE WAS A REALLY MEANINGFUL FOCUS LEER I DIABETES CARE AND G A KNOWING THAT MORE OF THOSE WHO DEVELOP TYPE 2 DIABETES, THEY DEVELOP IT BECAUSE OF OVERWEIGHT, SO WHY TREAT THE DISEASE IF YOU CAN ACTUALLY PREVENT IT BY ADDRESSING THE UNDERLYING CAUSES? WE ALSO KNOW THAT FOR MANY NO WIDELY USED AND THEY WERE WAS NOT ALL DELIVERING UP AGAINST PATIENTS' AND PHYSICIANS' EXPECTATIONS SO WE SAW WITH OUR LATEST INNOVATION THAT WE REALLY, PERHAPS FOR THE FIRST TIME, MET THOSE EXPECTATIONS, AND A LOT OF DISCUSSION WAS ONGOING ABOUT, OKAY, NOW THERE'S FINALLY AN EFFICACIOUS TREATMENT FOR PEOPLE LIVING WITH OBESITY, AND SUDDENLY THE WHOLE MARKET TAKES OFF, AND THAT'S REALLY FASCINATING BUT ALSO COMES WITH A LOT OF HARD WORK BECAUSE WE HAVE TO SCALE UP AND RAMP UP MANUFACTURING LIKE WE HAVE NEVER DONE BEFORE. BUT IT'S ALL REALLY EXCITING, AND I FEEL SO PROUD ON BEHALF OF ALL THE GREAT COLLEAGUES AND REALLY COMMITTED EMPLOYEES AT NOVO NORDISK AND IT'S REALLY A CREDIT TO ALL THOSE THAT GO TO WORK EACH AND EVERY DAY FOCUSED ON HELPING PATIENTS. >> YEAH. I MEAN SO GLAD YOU BROUGHT UP THE MANUFACTURING. YOU'RE INVESTING A LOT IN THAT, ABOUT $4 BILLION FOR THE UPCOMING YEARS TO EXPAND MANUFACTURING, ALMOST DIRECTLY AS A RESULT OF THIS. BUT DO YOU FEEL LIKE YOU MAY BE OVERINVESTING, CONSIDERING THERE ARE COMPETITORS COMING DOWN THE PIKE? THERE ARE SOANYTHER THAT ARE GOING TO BE IN THIS SPACE SOON. DO YOU FEEL LIKE YOU'RE ON THE RIGHT TRACK WITH THIS? >> I BELIEVE WE ARE RAMPING UP AS NEEDED, AND IF YOU THINK ABOUT IT, W.H.O. PREDICTED THAT BY 2030, THE WI BE BILLN PEOPLE LIVING WITH OBESITY, AND SO FAR, WE'RE JUST SCRATCHING THE SURFACE OF WHAT THAT MEANS IN TERMS OF BRINGING THEM EFFICACIOUS MEDICINES. IN THE U.S., THERE'S MORE THAN 100 MILLION WITH A BMI ABOVE 30, SO THERE'S ROOM FOR COMPETITION. THERE'S ROOM FOR CHOICE. AS LONG AS PRODUCTS STAY SAFE AND THEY GET, SAY, WELL ABOVE 15% IN WEIGHT LOSS, I THINK YOU CAN HAVE A SERIOUS PLAY, AND WE HAVE A VERY STRONG PIPELINE COMING. WE ARE ALREADY NOW IN LATE STAGE DEVELOPMENT OF OUR NEXT GENERATION PRODUCTS. WE KNOW WHAT WILL BE MOVING INTO THE PIPELINE IN COMING YEARS IN TERMS OF EVEN STRONGER PRODUCTS, SO FOR US, THIS IS A LONG-TERM JORNEY OF GETTING TO MORE AND MORE PATIENTS, AND I THINK WE HAVE MAYBE ONE OF THE BEST OPPORTUNITIES IN DRIVING POPULATION HEALTH INTERVENTION, AND REALLY PREVENTING SOME OF THE COMORBIDITIES THAT FOLLOW LIVING WITH OBESITY, AND I THINK THAT'S A GREAT VALUE ADD FOR THE INDIVIDUAL PATIENT. IT'S GREAT FORSOCIETY, FOR THE HEALTH CARE SYSTEMS THAT ARE STRUGGLING IN MOST COUNTRIES, AGING POPULATIONS AND A NUMBER OF BURDENS ON GOVERNMENTS, AGING POPULATION, AND NOW INCREASED SO REAY INVESTING IN ET CETERA. MEDICINES THAT CAN DRIVE PREVENTION AND IMPROVE HEALTH OUTCOMES. OUR COMPANY CAN BE REALLY PROUD OF WHAT CONTRIBUTIONS WE CAN HAVE IN THAT SPACE. >> YOU WERE KNOWN FOR INSIN FOR SO LONG, AND NOW, THIS EXPANSION. YOU'RE GIVING WALL STREET THE DIVERSIFY IT HAS CRAVED FOR THE COMPANY'S PORTFOLIO FOR SO LONG. BUT YOU'VE ALSO FOUND YOURSELF SORT OF IN THE COMMON CULTURE TH T MAS POPULATION THAT RECOGNITION OF THE BRAND, PROBABLY NOT WHAT YOU WANT WITH EVERYONE JUST CALLING EVERYTHING OZEMPIC, BUT AT LEAST THEY ARE RECOGNIZING THE BRAND NAME. SO, I WONDER HOW THAT'S BEEN FOR YOU, KNOWING THAT THIS BECAME SORT OF CELEBRITY CULTURE, AND YOU KNOW, IT'S BEEN EVERYWHERE THIS YEAR. >> YEAH, IT'S A BIG CHANGE. I'VE BEEN WITH THE COMPANY FOR MORE THAN 30 YEARS. I'M ONLY THE FIFTH CEO IN A HUNDRED-YEAR-OLD COMPANY, AND NOW WE'RE GROWING, YOU KNOW, AROUND 30% A HUNDRED YEARS INTO OUR LIFETIME, AND SUDDENLY WE HAVE BRANDS THAT AREECOMG HOUSEHOLD NAMES, AND WE'VE NEVER, EVER HAD PRODUCTS THAT WERE LIKE, YOU KNOW, WIDELY KNOWN. SO, I THINK IT'S -- IT CAUSES SOME CHALLENGES, HOW TO HANDLE THAT, BUT ALSO DRIVES A LOT OF OPPORTUNITY, AND IF YOU THINK ABOUT, AS I MENTIONED BEFORE, OVER SOME TIME, HUNDREDS AND MILLIONS OF PATIENTS LIVING WITH OBESITY, AND FOR US TO GET TO THEM, IF WE HAD TO HAVE A HUGE SALES FORCE TO GO TO EACH AND EVERY PERSON, WE WOULD NEVER BE ABLE TO G TOANY OF THEM, BUT WITH BRANDS BEING ESTABLISHED, THERE'S DIFFERENT OPPORTUNITY OF ACTUALLY REACHING MORE PATIENTS, AND AGAIN, WHEN WE CAN DRIVE HEALTH RESILIENCE, STRONGER HEALTH OUTCOMES BY DOING THAT, BRDS THAT LEAD PATIENTS TOO HE SEEK CARE BECAUSE WE CAN DRIVE EVEN BIGGER CHANGE THAN WE COULD HAVE IF THESE WERE NOT WELL ESTABLISHED BRANDS. WE HAVE TO FACE DIFFERENT CHALLENGES, BUT I SEE IT REALLY AS A BIG OPPORTUNITY FOR HELPING SOCIETY AND GET TO MANY MORE PATIENTS THAN WE'VE EVER DONE SO FAR IN THEISTO OF THE COMPANY. >> IT'S REALLY INTERESTING BECAUSE YOU HAVE -- YOU'RE LIKE A FASHION HOUSE NOW. YOU HAVE TO DEAL WITH KNOCKOFFS, ESPECIALLY WHILE YOU STILL HAVE THE SHORTAGE ONGOING. THAT MUST BE AN INTERESTING POSITION. BUT I WANT TO TALK ABOUT THE COMPANY ITSELF. IT'S GOT AN INTERESTING CORPORATE STRUCTURE. WE KNOW THAT YOU WERE RECENTLY COMPARED T EVE WHAS GOING ON WITH OPENAI AND HAVING A VERY DIFFERENT CORPORATE STRUCTURE. HOW DOES THAT GET AFFECTED WITH THE SUCCESS? WHO WINS AT THE END OF THE DAY, AND HOW DO YOU, PERSONALLY, FEEL ABOUT HOW THE SUCCESS IS IMPACTING THE COMPANY? >> I WILL SAY THAT WHAT WE DO INSIDE THE COMPANY HAS NOT CHANGED AT ALL, SO I MENTIONED THAT WE HAVE BEEN RESEARCHING IN OBESITY FOR 25 YEARS. THAT CONTINUE. WE HAVE BEEN PRODUCING MEDICINES FOR PEOPLE LIVING WITH DIABETES AND A FEW OTH DISEASES FOR A HUNDRED YEARS. SO, THE ACTIVITIES INSIDE THE COMPANY CONTINUE. WE HAVE AN OWNERSHIP STRUCTURE THAT'S INTERESTING IN THE SENSE THAT WE'RE CONTROLLED BY A FOUNDATION, SO THE FOUNDERS OF NOVO NORDISK ACTUALLY GE CONTROL OF THE COMPANY TO A FOUNDATION BECAUSE THEY FELT THAT WOULD BE THE BEST LONG-TERM OWNERSHIP FOR THE COMPANY, AND THEN, OF COURSE, WE ARE LISTED ON THE STOCK MARKET, SO WE HAVE THE DISCIPLINE THAT COMES FROM BEING LISTED COMPANY, AND ASSESSING, YOU KNOW, ASSESSING R PERFORMANCE ON A DAILY BASIS. BUT WE ALSO HAVE THIS STABLE AN ANCHOR IN THE FOUNDATION WHICH HAS A CONTROLLING STAKE. THAT'S HOW WE LOOK AT OUR BUSINESS. WE'RE IN THIS FOREVER. SO, WE'RE NOT CHASING SHORT-TERM RETURNS, BUT WE'RE REALLY TRYINM WITH AN EYE FOR THE SOCIAL RESPONSIBILITY WE HAVE, THE ENVIRONMENTAL RESPONSIBILITY WE HAVE, AND OF COURSE, THE HEALTHY COMPANY FROM A FINANCIAL POINT OF VIEW. SO, THESE BOTTOM LINES WE PURSUE, IT'S KIEMND OF GUIDING EVERYTHING WE DO, AND I THINK THAT CREATES A VERY GOOD LONG-TERM PERSPECTIVE, AND A BALANCE OF SUCCEEDING AS A COMPANY, BUT ALSO ADDING VALUE TO THE SOCIETY WE SERVE. BA WITH US ONSET, AND ANJ, E THAT WAS A WIDE-RANGING INTERVIEW YOU HAD WITH LARS. JUST IN TERMS OF THE POTENTIAL FOR THIS DRUG, WHAT THE PIPELINE LOOKS LIKE BEYOND OZEMPIC, AND ALSO JUST IN TERMS OF WHAT THE FUTURE IS GOING TO HOLD WITH R&D AND SO MUCH OF THAT PRIORITY AND WHERE THAT EXACTLY LIES. >> YEAH. U KN WHAT'S REALLY INTERESTING TO ME IN THAT CONVERSATION, THOUGH, IS HOW MUCH HE SEEMED TO CARE ABOUT THE SOCIETAL ASPECT OF IT. AND I THINK ONE OF THE CONVERSATIONS THAT'S BEING HAD AS A RESULT OF THIS RUNAWAY SUCCESS OF THIS DRUG IS HOW MUCH FOOD NEEDS TO CHANGE, NOT JUST THAT IT'S GOING TO IMPACT PEOPLE'S CRAVINGS, BUT ALSO WHAT THE FOOD INDUSTRY, WHICH HAS LONG BEEN OVERDUE FOR SOME CHANGE AND AN OVERHAUL HASN'T -- THERE'S BEEN NO PRESSURE ON THEM. DOES THIS ACT AS SORT OF THAT FINAL LEVER TO PUSH THEM INTO HEALTHY EATING AND HEALTHY FOOD FINDING WAYS TO MAKE THAT ECONOMICAL? I THINK THAT'S PART OF THE CONVERSATION THAT IS THE FUTURE OF THIS WHOLE SECTOR, AND SO THAT'S THE FASCINATING PART TO ME. YOU KNOW, HOW HE THINKS ABOUT HOW THIS DRUG IMPACTS THE WAY WE HAVE MORE SEDENTARY SOCIETY AND THE LIKE, BUT DEFINELY FUTURE OUTLOOK, WE TALKED ABOUT THIS A LITTLE BIT AGO, JUST, THERE'S SO MUCH COMPETITION IN THE SPACE NOW. THEY HAVE TO RAMP UP MANUFACTURING. THEY'RE DEALING WITH A -- AS ONE OF THE ANALYSTS SAID EARLIER, A HUGE COMPANY LIKE ELI LILLY WHO STARTED THE GLP RACE, BUT THIS IS A NEW SEGMENT OF THE STORY. JUST INTERESTING, ALL PARTS PUT TOGETHER. >> DO YOU GET A SENSE THAT THEY BELIEVE THAT THIS LEADS TO A HEALTHIER SOCIETY AT THE END OF THE DAY? >> THE GOAL IS THAT IN SOME PEOPLE'S EYES. I DON'T THINK THE COMPANY -- I THINK THE COMPANY SEES ITSF AS SORT OF STEMMING THAT TIDE, HELPING WHERE FOOD IS NOT, BECAUSE THEY ARE NOT A FOOD COMPANY. SO, WHERE THEY CAN HAVE ANY IMPACT, THAT, I THINK, IS WHERE THEY'RE LOOKING. >> BECAUSE IT'S A TOTAL CHANGE IN LIFESTYLE. >> COMPLETELY. >> AT THE END OF THE DAY TOO. AND THAT'S WHAS STL BEING STUDIED. I MEAN, YOU TALK ABOUT FOOD. IT'S GOING TO CHANGE, ACCORDING TO SOME STUDIES, THE SIZES THAT PEOPLE ARE WEARING BY TWO TO THREE SIZES AS WELL, SO THERE'S WIDE-RANGING IMPACTS HERE AS WELL. >> AND ALL -- THE UNDERTONE IS ALL, IF EVERYONE STAYS ON IT AND DOESN'T REGAIN THE WEIGHT A WE FIND OUT IT'S OKAY TO TAKE VERY, VERY LONG-TERM. SO MANY UNKNOWNS. IT'S A NEW CHAPTER AND SO INTERESTING TO BE IN THE FRONT ROW WATCHING IT. > ABSOLUTELY. >> IT'S BEEN AMAZING TO WATCH JUST IN TERMS OF ASTRONOMICAL RISE IN THE POPULARITY OF THESE DRUGS. MYLES POINTED IT OUT, IT'S ALMOST BECOME A VERB. WHEN YOU SAY, THEY'RE ON OZEMPIC, YOU KNOW EXACTLY -- MOL MOST PEOPLE KNOW WHAT PEOPLE ARE SAYING OR REFERRING TO. >> OZEMPICING? >> YOU DIDN'T KNOW? IT'S KIND OF LIKE, I GUESS, NOT SO MUCH VB. IT'S LIKE HOW YOU WOULD SAY, DID YOU GRAB THE UBER? ARE YOU UBERING THERE? ARE YOU OZEMPICING? THAT'S NOT GOING TO WORK OUT. YOU KNOW WHAT I MEAN. YOU'RE POINTING TO THE -- YOU CAN USE THE WORD THAT THEY COINED, OZEMPIC, FOR THEIR DRUG, AND REALLY POINTS TO -- >> IT'S GOT ITS OWN STREET CRED. WITH MY SELF-CARE THAT I DO AS WELL? >> YOU'LL BE WEGOVYING A COUPLE DAYS IN A ROW. >> ANJALEE KHEMLANI, THANK YOU SO MUCH. WE'RE GOING TO WORKSHOP THE VERBIFICATION OF THIS. >> LET ME KNOW. >> ALL YOUR MARKETS ACTION AHEAD. STAY TUNED. YOU'RE WATCHING YAHOO! FINANCE. >>> IT'S A BUSY WEEK FOR ECONOMIC DATA BEFORE THE HOLIDAY SEASON KICKS INTO GEAR. CPI AND A FED RATE DECISION, THEY ARE ON THE AGENDA THIS WEEK. MARKETS ARE BETTING ON A SOFT LANDING NEXT YEAR, SO WILL THE NUMBERS REFLECT THAT NARRATIVE? FOR MORE ON THIS, WE'VE GOT YAHOO! FINANCE REPORTER JOSH SCHAFER HERE TO TELL US MORE. HEY, JOSH. >> YEAH, BRAD, WE JUST HAD THE COCHLEA CALENDAR UP, AND I WANT TO TAKE A CLOSER LOOK AT THAT AND POINT OUT SOME OF THE KEY DATA POINTS WE HAVE COMING THIS WEEK. WE HAVE THE CPI PRINT ON TUESDAY. THAT'S A READING ON INFLATION AND WILL BE OUR FIRST READING OF INFLATION FOR THE MONTH OF NVEMBER. PPI ON WEDNESDAY. PRODUCER PRICES, WHAT ARE COMPANIES PAYING, AND THEN FED DECISION ON WEDNESDAY IS THE REAL HIGHLIGHT. THURSDAY, YOU'RE GOING TO GET A LOOK AT THE CONSUMER WITH RETAIL SALES, BUT I WANT TO ZOOM IN TODAY, BRAD, ON INFLATION A LITTLE BIT, BECAUSE IT'S ONE OF THE BIGGER PRINTS WE'RE GOING GET. GOLDMAN-SACHS HAD AN INTERESTING CHART OUT TODAY - ACTUALLY, I'LL HIT YOU WITH THE PROJECTIONS FIRST. MONTH OVER MONTH, LOOKING FOR FLAT. YEAR OVER YEAR, 3.1%. THEN, WHEN YOU TAKE A LOOK AT CORE CPI, ECONOMISTS ARE EXPECTING A 4% RISE IN CORE CPI, ALSO MONTH OVER MONTH FLAT, THOUGH, WHICH IS KEY. THAT HAS BEEN COMING IN -- INFLATION HAS BEEN FALLING QUICKER THAN PEOPLE EXPECT, WHICH IS THE CHART THAT I WANT TO GET TO HERE. WHEN YOU TAKE A LOOK AT THIS CHART FROM GOLDMAN-SACHS, IT'S PCE, WHICH IS A DIFFERENT MEASURE OF INFLATION, BUT IT TELLS THE POINT OF WHAT WE'RE TRYING TO SHOW HERE. YOU CAN SEE GOLDMAN'S CURNT FORECAST IN LIGHT BLUE THERE. YELLOW WAS THEIR FORMER FORECAST FOR INFLATION. SO, INFLATION FORECASTS HAVE BEEN DROPPING AS INFLATION HAS BEEN FALLING QUICKER THAN PEOPLE THOUGHT. THE KEY REASON I BRING THAT UP, BRAD, IS BECAUSE WHEN YOU LOOK AT THAT ORANGE LINE THERE COMING ACROSS HORIZONTALLY, THAT'S WHEN TH THI THEED IS GOING TO CUT. YOU CAN SEE HOW MUCH QUICKER WE REACH THAT ORANGE LINE WITH THE CURRENT FORECAST FOR INFLATION, CAME UP ABOUT FOUR MONTHS IN GOLDMAN'S FORECAST TODAY, SO INFLATION COMING DOWN QUICKER THAN PEOPLE THINK IS PART OF WHAT'S DRIVING THIS NARRATIVE THAT WE MIGHT GET A FED CUT QUICKER, AND SO THAT WILL BE SOMETHING WE'RE WATCHING FOR TOMORROW. >> IF THE GRAPHIC DIDN'T COME UP, I WAS GOING TO HOLD UP MY PAPER. I PRINTED IT OFF. YOU KNOW I DID. >> YOU CAN ALWAYS COUNT OHIM. JOSH, THANK YOU SO MUCH FOR BREAKING THAT DOWN. CERTAINLY A BUSY WEEK AHEAD. >>> NEW ANALYSIS FROM THE "WASHINGTON POST" FOUND THAT AT LEAST EIGHT FATAL OR SERIOUS CRASHES INVOLVING TESLA'S AUTOPILOT OCCURRED WHERE THE AUTOPILOT FEATURE SHOULD NOT HAVE BEEN ACCESSIBLE IN THE FIRST PLACE. THE CAR'S MANUAL DOES WARN THAT ITS AUTOPILOT CAN BEUNRELIABLE ON ROADS WITH HILLS AND CURVES, BUT THE COMPANY HAS NOT TAKEN STEPS TO LIMIT ITS AVAILABILITY BY GEOGRAPHY. FOR MORE ON THIS, WE WANT TO BRING COLIN RUSH, OFPPENHEIMER' MANAGING DIRECTOR AND RESEARCH ANALYST. LET'S TALK ABOUT WHAT THIS MEANS IN TERMS OF WIDER SPREAD ADOPTION. WE'VE SEEN THE FACT THAT EVs, AT LEAST IN TERMS OF DEMAND, THAT DEMAND SEEMS TO BE FALLING. WE HAVE THIS REPORT OUT FROM THE "WASHINGTON POST" POINTING TO SOME ISSUES THAT TESLA MIGHT HAVE HERE WITH ITS AUTOPILOT SYSTEM. HOW BIG OF A RISK DO YOU SEE THIS BEING FOR TESLA, ALEAS IN THE SHORT-TERM? >> I WANT TO STEP BACK A LITTLE BIT ON THIS EV NARRATIVE, BECAUSE I THINK THE GROWTH HAS BEEN MODERATING A LITTLE BIT. WE'RE STILL TALKING ABOUT 35 TO 40% YEAR OVER YEAR UNIT GROWTH ON EVs, SO I JUST WANT TO MAKE SURE THAT POINT GETS MADE HERE BEFORE WE MOVE ON TO THE AUTOMOU. THE REPORT FROM "THE WASHINGTON POST" IS IMPORTANT BECAUSE IT RAISES THE DEBATE THAT I THINK IS HAPPENING WITHIN THE INDUSTRY ABOUT HOW TO MANAGE RISK AS YOU BRING THIS NEW TECHNOLOGY INTO THE MARKET AND WHO'S ACTUALLY RESPONSIBLE FOR THAT RISK, AND THE TESLA POLICY THAT WE'RE SEEING REALLY PUTHE ONUS ON OPERATORS TO COMPLY WITH THE MANUAL RATHER THAN PUTTING SOME INCREMENTAL CONTROLS ON THIS. AND UNDERLYING THAT IS THE BELIEF FROM TESLA THAT THE SYSTEM IS ACTUALLY BETTER THAN DRIVERS, AND SO STATISTICALLY, IT'S LIKELY THAT THESE CARS WILL PERFORM BETTER THAN A LOT OF DRIVERS ON THE ROAD. WHETHER THAT'S REAL OR PERCEIVED BY REGULATORS AND THE GENERAL PUBLIC IS STILL TO BE DETERMINED. BUT I THINK THE REGULATORY APPROACH THAT WE'VE SEEN SO FAR IS THAT THE REGULATORS ARE FOLLOWING THE INDUSTRY BECAUSE THE TECHNOLOGY IS MOVING TO QUICKLY, AND AS WE GO FORWARD HERE, I THINK THERE'S GOING TO BE A MORE PUBLIC CONCERN AND TRANSPARENCY THAT'S NECESSARY TO REALLY GAIN TRUST AMONGST THE BROADER POPULATION AROUND HOW THESE VEHICLES REALLY DO CARRY FORWARD. >> BUT YOU DON'T SEE THAT WEIGHING ON DEMAND, AT LEAST FOR TESLA, IN THE NEAR TERM UNTIL WE GET MORE CLARITY? >> ABSOLUTELY. TESLA HAS A BRAND ISSUE, AND THIS STARTED WITH ELON'S ACQUISITION OF TWITTER AND HIS PUBLIC PERSONA AND WHAT HE HAS GOT IN THE -- IN THAT PUBLIC DISCOURSE AROUND HIS POLITICAL VIEWS AND WHATNOT SO, AS WE MOVES TECHNOLOGY, I THINK IT'S PART OF A LARGER BRANDING ISSUE FOR TESLA IN TERMS OF HOW THEY PRESENT THEMSELVES, BECAUSE THEY WERE SEEN REALLY AS THE LEADING COMPANY ON BRINGING CLEAN, SAFE VEHICLES TO MARKET, AND NOW, AS THE REALITY COMES FORWARD, THERE'S A LOT MORE GOING ON HERE, AND I THINK THERE'S A LOT OF FOLKS THAT HAVE GOTTEN CONCERNED WITH SUPPORTIG ELON MUSK INDIVIDUALLY FROM A BRAND PERSPECTIVE AND THERE IS THIS ONGOG CO OUTROGRAM AND MORE OF A TRADITION THAT'S HAPPENING IN THE EV SPACE AS WELL. I THINK THIS IS JUST ONE MORE ELEMENT OF THAT BROADER DYNAMIC, AND IT CERTAINLY ISN'T GOING TO HELP FOLKS BUY THE FST OFFERING OR SIGN UP FOR IT UP FRONT AND THERE'S GOING TO BE CONCERN FROM OTHER FOLKS ON HOW OTHER OEMs ARE CARRYING THIS FORWARD. >> HOW DOES TESLA NEED TO REBRAND ITSELF? >> I'M NOT GOING TO SEE REBRAND THEMSELVES, BUT I THINK THEY NEED TO SHOW A LITTLE BIT MORE CORPORATE RESPONSIBILITY IN THE PUBLIC MARKETS WITH FOLKS. PUSHING THIS OFF ON TO CONSUMERS THAT ARE RESPONSIBLE FOR HOW THE TECHNOLOGY IS ENGAGED I DON' THINK IS FULSOME ENOUGH. AND SO, AS I THINK THIS COMPANY, YOU KNOW, FIGURES OUT HOW TO REALLY POSITION ITSELF IN THE THINNOVATION THAT IT BRINGS, NCE WHICH IS A REAL ASSET, BUT ALSO DOING THAT IN A RESPONSIBLE WAY, AND WHERE THOSE LINES ARE DRAWN IS GOING TO BE REALLY IMPORTANT FOR THE COMPANY AS THEY TRY TO BRING FST FULLY INTO THE MARKET AND INTRODUCE IT AS A REAL OFFERING THAT THEY CAN MONETIZE. >> COLIN, I WANT TO PIVOT JUST A BIT AND TALK ABOUT ANOTHER BIG HEADLINE WHEN IT COMES TO TESLA, WHAT WE HAVE SEEN PLAY OUT OVER THE LAST FEW WEEKS AND THAT'S THE UAW. WE HAVE THE UAW TARGETING MORE AUTOMAKERS. TESLA SEEMS TO BE ONE OF THEIR TARGETS. IT'S GOING TO BE A PRETTY HIGHLY CONTESTED BATTLE, I WOULD SAY TH. HOW DO YOU SEE THAT SHAPING UP NEXT YEAR? >> IT'S REALLY SUCH AN IMPORTANT QUESTION. IT'S IMPORTANT FOR WORKERS TO HAVE A LIVING WAGE. THAT'S CRITICAL FOR OUR ECONOMY AND JUST GENERAL DECENCY. HOW THAT CARRIES FORWARD INTO THE ACTUAL MANUFACTURING PROCESS, I THINK IT'S GOING TO BE A BIG FIGHT, AND THIS IS A VERY PUBLIC FIGHT. WHAT WE SAW WITH THE BIG THREE IS THAT THE LABOR MOVEMENT AND ORGANIZERS DID A GOOD JOB OF GETTING WHAT THEY WANTED FOR THEIR CONSTITUENTS, AND HOW THIS PLAYS OUT WITH TESLA IS GOING TO BE VERY HIGH-PROFILE, NOT JUST FOR TESLA BUT ALSO FOR THE MAGNIFICENT SEVEN IN THE TECH INDUSTRY AND PARTICULARLY AS IT PERTAINS TO OTHER FOLKS LIKE AMAZON WHO HAS RESISTED UNIONIZATION IN A NUMBER OF THEIR FACILITIES. I DON'T KNOW HOW THIS ULTIMATELY GOES, AND HOW THE NEGOTIATIONS PLAY OUT, BUT THE COLLECTIVE BARGAINING, I THINK, IS SOMETHING THAT'S GOING TO BE AN ONGOING ISSUE, PARTICULARLY AS WE'VE SEEN SOME OF THESE COMPANIES REALLY GROW MUCH FASTER THAN OTHERS, AND THE COUNTRY REALLY WORKS TOWARDS HAVING A SUSTAINABLE MANUFACTURING BASE HERE, AND I THINK THIS IS GOING TO BE ONE THAT IS GOING TO HAVE A LOT OF TWISTS AND TURNS THAT'S GOING TO BE VERY INTERESTING TO SEE HOW IT PLAYS OUT. >> YEAH, THERE'S SEVERAL CONSIDERATIONS ON THAT FRONT IF THEY WERE TO HAVE TO KIND OF GO HEAD-TO-HEAD WITH THE UAW, COULD IMPA THEARGI AT THE END OF THE DAY, WHICH WOULD -- HAVE ALREADY BEEN IN FOCUS FOR INVESTORS FOR SEVERAL YEARS AT THIS POINT, EVEN AMID A PRICING STRATEGY THAT THEY'VE ROLLED OUT MORE SO INTERNATIONALLY WHERE THEY HAVE STARTED TO CUT VASTLY TO TRY AND GET PEOPLE INTO THE ECOSYSTEM FOR TESLA AND THEN HOPE TO SEE A LARGER CUSTOMER LIFETIME VALUE OVER TIM ALL OF TN WE EXTRAPOLATE FROM THE DEALS THE UAW HAS BEEN ABLE TO MAKE WITH THE BIG THREE AUTOMAKERS IN THE U.S. AND APPLY TO TESLA AND GET THE BEST-CASE CALCULUS FOR WHAT THAT MIGHT MEAN FOR VALUATION AND WHETHER OR NOT THAT'S FACTORE INTTHEHARE PRICE RIGHT NOW. >> I DON'T THINK IT'S FACTORED INTO THE SHARE PRICE RIGHT NOW. LET'S JUST BE CLEAR ON THAT. IN TERMS OF OVERALL IMPACT, THE WORKERS IN TESLA'S FACTORIES ARE THERE'S A BIG HURDLE THAT HAS TO BE CLEARED BEFORE YOU CAN ACTUALLY GET INTO COLLECTIVE NEGOTIATION, AND I THINK THAT'S THE FIRST ELEMENT THAT WE'RE GOING TO WATCH. AS WE LOOK AT THE BIG THREE AND THE HISTORY WITH UNIONS, THAT WAS VERY WELL ESTABLISHED. THERE WAS LINES OF COMMUNICATION, A LOT OF HISTORY THERE. THAT'S NOT IN PLACE IN TESLA. AND SO, THE FST THING THAT WE'RE GOING TO BE WATCHING FOR IS WHETHER THOSE WORKERS UNIONIZE OR NOT AND HOW TESLA PROACTIVELY GOES AFTER AVOIDING THAT SORT OF UNIONIZATION AND HOW THEY WORK THROUGH THAT COMPENSATION WITH THEIR EMPLOYEES AND HOW IT MIGHT EVOLVE IS A LITTLE UNCLEAR. WE'VE SEEN A LOT OF FOLKS END UP WITH STOCK-BASED COMP AS PART OF THEIR COMPENSATION AND HOW THAT ULTIMATELY GETS SHARED ACROSS THE ORGANIZATION IS A LITTLE UNCLEAR RIGHT NOW AS WE MOVE INTO THE NEXT COUPLE OF YEARS, BUT THAT'S ONE AREA THAT WE REALLY NEED TO SEE GET CLARIFIED. IN TERMS OF THE OVERALL IMPACT ON THE MARGS, YOU KNOW, I ULTIMATELY THINK IT'S GOING TO BE ON THE LEVEL OF, YOU KNOW, MAYBE A POINT OR TWO ON THE GROSS MARGIN LEVEL, AND TESLA'S REALLY COMMITTED TO DRIVING COSTS OUT FROM A TECHNOLOGY PERSPECTIVE, AND SO THE LABOR CONTENT OF THESE VEHICLES, I THINK, CONTINUES TO MOVE LOWER AS WE MOVE FORWAR AND THAT INCREMENTAL, YOU KNOW, COST TO THE COMPANY AND THE U.S. IS GOING TO BE RELATIVELY SMALL FROM AN OVERALL PERSPECTIVE, BUT IT COULD HAVE THAT 100 TO 200-BASIS-POINT IMPACT POTENIALLY. >> ALL THINGS FOR INVESTORS TO NE YEAR HERE. GOING INTO THE THANK YOU SO MUCH FOR JOINING US, COLIN. APPRECIATE IT. OPPENHEIMER'S MANAGING DIRECTOR AND SENIOR RESEARCH ANALYST. >>> ALL RIGHT. ALL YOUR MARKETS ACTION AHEAD. STAY TUNED. YOU'RE WATCHING YAHOO! FINANCE. >>> A FIGHT FOR CONTROL OF THE SKIES AND LAST OR FAST MILE DELIVERY, ALPHABET'S WING VENTURE IS AMONG ONE OF A FEW FREIGHT DELIVERY DRONES LOOKING TO ELEVATE ITS RETAIL CUSTOMER EXPERIENCE AND COMPETE WITH GIANTS LIKE AMAZON. WITH THE HOLIDAY SEASON IN FULL SWING, WING SEES APPETITE FOR A FAST-MILE DELIVERY GROWING NOW MORE THAN EVER. JOINING ME NOW, WE WANT TO BRING IN SHANNON NASH, ALONG WITH OUR VERY OWN DIANE KING HALL. GREAT TO SEE BOTH OF YOU. SHANNON, LET ME START WITH A RECENT REPORT THAT YOU JUST PUBLISHED. YOU LOOKED INTO THE FACT, I GUESS, HOW PEOPLE ARE SHOPPING AHEAD OF THE HOLIDAY SEASON, WHAT THIS NEED WOULD LOOK LIKE FOR WHAT YOU'RE CALLING FAST MILE DELIVERY. WHAT DID YOU FIND? >> WE FOUND THAT 74% OF THE FOLKS THAT WE SURVEYED REALLY SAW A NEED FOR THIS INSTANT FAST MILE DELIVERY, AE'RE TALKING ABOUT THINGS LIKE, IT'S THE HOLIDAY PARTY, EVERYTHING IS READY, YOU'RE ABOUT TO SET THE TABLE, AND SOMEBODY, WE WON'T NAME WHO, FORGOT THE DINNER ROLLS, AND IT'S GOING TO TAKE, YOU KNOW, AT LEAST 30 MINUTES TO AN HOUR TO MAKE THAT HAPPEN. WE'RE SEEING A LOT OF CUSTOMERS SAYING THAT F THIS FAST MILE DELIVERY, THEY'RE LOOKING AT THINGS LIKE GROCERIES. IN FACT, 43% SAID THEY WOULD USE THIS SERVICE FOR LAST-MINUTE GROCERIES AND THEN ANOTHER 23% SAID THEY WOULD USE IT FOR THOSE GIFTS. YOU CAN'T GO TO THE PARTY WITH AN EMPTY HAND, SO, YOU KNOW, GIFTS ARE ALSO SOMETHING VERY POPULAR AMONG CUSTOMERS. >> SHANNON, FIRST, I WANT TO CONGRATULATE YOU. I SAW THE NOTE TODAY WITH THE CFO OF THE YEAR BY DATA RAILS IN THE TECH CATEGORY, SO CONGRATULATIONS ARE IN ORDER. NEXT, I WANT TO ASK YOU ABOUT THE EXPANSION STRATEGY FOR WING. OBVIOUSLY, THERE'S NOT --HERE AR DRONE DELIVERY SPACE, SO WHAT IS YOUR MARKET EXPANSION STRATEGY, ESPECIALLY WHEN YOU COMPETE AGAINST THE LIKES OF AMAZON? >> WELL, DIANE, YOU KNOW, WE'VE DONE OVER 350,000 DELIVERIES. WE'VE OPERATED IN THREE CONTINENTS,N AUSTRALIA, IN EUROPE. WE WERE IN FINLAND, AND NOW WE'RE IN IRELAND, AND THEN IN THE UNITED STATES, WE STARTED IN VIRGINIA, AND NOW WE ARE IN THE DALLAS-FORT WORTH AREA WITH WALMART. SO, OUR EXPANSION PLANS ARE TO KEEP DOING EXPANSIONS, PARTICULARLY IN THE U.S. 'RE FOCUSED ON EXPANDING WITH PARTNERSHIPS LIKE WITH WALMART AND AUSTRALIA, WE'VE OPERATED WITH DOORDASH, SO CONTINUING TO EXPAND WITH THOSE PARTNERS. >> AND I WANT TO ASK YOU ABOUT JUST THE CHALLENGES THAT DRONE DELIVERY FACES. KNOWHERE CAN BE SOME CHALLENGES WHEN YOU THINK ABOUT, SAY, URBAN AND RURAL AREAS. HOW ARE YOU ALL SURMOUNTING THOSE CHALLENGES OR ADDRESSING THOSE CHALLENGES? >> YEAH, WE STARTED, AS I MENTIONED, IN AN URBAN AREA IN THE UNITED STATES IN A PLACE CALLED CHRISTIANSBERG, VIRGINIA, TE, AND I'M A UVA GRAD, SO, NIA YOU KNOW, WE'RE RIVALS, BUT I'M VERY HAPPY THAT'S WHERE WE STARTED OUR BUSINESS. AND WHAT WE FOUND, DIANE, IS WE HAVE ACTUALLY A COUPLE THAT WON THE WORLD RECORD FOR THE MOST DRONE DELIVERIES IN A RURAL TH'VE DONE OVER A THOUSAND DELIVERIES, AND THE NUMBER ONE THING THAT THEY ORDERED, THEY ORDERED A LOT OF FOOD, BUT THE THING THAT SURPRISED ME THE MOST IS THEY ORDERED ALMOST A HUNDRED BOXES OF GIRL SCOUT COOKIES. AS I MENTIONED BEFORE, WE HAVE EXPANDED, PARTICULARLY IN AUSTRALIA, WITH DOORDASH, AND THAT'S IN MORE URBAN ENVIRONMENTS, AND WE ARE IN THE DALLAS-FORT WORTH AREA IN FRISCO, TEXAS, WITH WALMART IN A MORE URBAN AREA AND WE'VE BEEN ABLE TO SHOW OUR DRONES HAVE BEEN ABLE TO MEET BOTH ENVIRONMENTS. >> WING IS ONE OF THE OTHER EXCITING BETS THAT ALPHABET HAS MADE HERE, AND A LOT O PPLE DON'T GET THE INSIGHT INTO WHAT THE FINANCIALS LOOK LIKE AT THE COMPANY. WHAT DOES THAT PATHWAY TO PROFITABILITY FOR THIS BUSINESS UNIT LOOK LIKE? >> I THINK THAT JUST IN THE DRONE DELIVERY INDUSTRY, I'LL TALK ABOUT IT IN A BROAD WAY, THE PATHWAY TO PROFITABILITY REALLY LOOKS LIKE SCALING YOUR ORGANIZATION ACROSS DIFFERENT GEOGRAPHICAL LOCATIONS. IT ALSO, AT THE SAME TIME, GETTING YOUR COSTS RIGHT IN LINE. OUR PLANE ONLY WEIGHS 11 POUNDS. IT'S MOSTLY MADE OF STYROFOAM. IT'S REALLY GETTING THE COST STRUCTURE OF YOUR DRONE TO BE RIGHT-SIZE FOR THE SCALE THAT YOU'RE BUILDING, AND AT THE SAME TIME, MAKING SURE THAT YOU'RE VERY FOCUSED ON SAFETY AND SUSTAINABILITY IN DOING SO. >> AND THEN, SHANNON, WHEN YOU THINK ABOUT, A.I. HAS BEEN THE BUZZWORD OF THE YEAR, WHEN YOU THINK ABOUT EFFICIENCIES THAT ARE BEING CREATED DUE TO A.I., HOW MUCH OF THAT IS BUILT IN THE EXPANSION PLANS FOR WING AND HOW YOU WILL OPERATE? >> A.I. IS THE BUZZ EVERYWHERE. OUR PLANES ARE AUTONOMOUS. I THINK THAT A LOT OF PEOPLE, WHEN I FIRST MEET THEM AND I TALK ABOUT WHAT WE'RE DOING, STANDING AROUND WITH A JOYSTICK AND DRIVING THE PLANE TO DROP OFF THE PACKAGES. THAT IS NOT THE CASE. THE PLANES PLAN OUT THEIR OWN ROUTES, AND THEY'RE COMPLETELY OPERATED IN AN AUTONOMOUS WAY SO YOU'RE GOING TO SEE A.I. IS A VERY IMPORTANT PART OF OPERATING SERVICES LIKE DRONE DELIVERY, ROBOTIC DELIVERY, ET CETERA, EVEN MORE SO THAN YOU SEE TODAY, I BELIEVE. AND THEN ALSO, YOU'RE GOING TO SEE, LIKE, A.I. IS ALSO BEING USED TO FUEL INNOVATION IN ALL THE BACK OFFICE FUNCTIONS, THE ACCOUNTING FINANCE, LEGAL NCTIONS. YOU'RE GOING TO SEE MORE A.I. TOOLS HELPING COMPANIES SCALE. >> WHAT ARE THE FINAL HANG-UPS THAT YOU'RE SEEING WITH REGARD TO REGULATORY RED TAPE BEING CUT IN CERTAIN REGIONS AS YOU'RE TRYING TO MAKE EVEN MORE OF THESE DELIVERIES, AND ONE DAY HIT CRITICAL MASS SO THAT I CAN BE IN BROOKLYN GETTING A DELIVERY AND WE DON'T HA TO RRY ABOUT THE AIR SPACE? >> YEAH, I MEAN, LOOK, I THINK WE'VE MADE SIGNIFICANT PROGRESS FROM A REGULATORY STANDPOINT, BUT LOOK, THERE'S STILL A LOT THAT WE NEED TO DO THAT WE NEED TO UNLOCK. I THINK ONE OF THE THINGS THAT THE INDUSTRY IS FOCUSING ON IS REALLY UNLOCKING WHAT WE WOULD SAY FROM A REGULATORY STANDPOINT, THE AIR SPACE, THE NUMBER OF WHAT THEY CALL VISUAL OBSERVERS THAT HAVE TO BE IN THE AIR SPACE FOR US TO OPERATE, AND I THINK AS THESE COMPANIES SCALE, YOU WILL SEE A MORE RIGHT-SIZING OF HOW MANY PEOPLE ARE NEEDED TO DO THAT AND HOW THAT IMPACTS US OPENING THE AIRWAYS. I'M WITH YOU. I CAN'T WAIT FOR THAT DAY THAT YOU'RE IN BROOKLYN AND GET THAT LATTE DELIVERED TO YOU VERY EASILY. >> I'LL CATCH IT. >> WE'LL ALL -- IT MIGHT BE A FIGHT FOR THAT LATTE. SHANN, BEF WE WANT TO GET PREDICTIONS. WE'VE BEEN DOING A LOT OF 2024 THOUGHTS AND EXPECTATIONS. WHAT ARE YOURS FROM THE CFO OFFICE, ESPECIALLY FOR THE C-SUITE? >> I THINK I ALLUDED TO ONE OF THEM, AND YOU DID AS WELL. I THINK, LOOK, A.I. IS GOING TO BE A BIG PART OF WHAT THE C-SUITE, IN PARTICULAR CFOs, FOCUS ON IN 2024. AND NOT JUST A.I. AND HOW IT UNLOCKS YOUR OPERATIONS BUT A.I. IN YOUR PRODUCT, IN YOUR SERVICE MIX. I THINK THAT IS GOING TO BE EVEN MORE INCREASINGLY IMPORTANT, BECAUSE A.I. IS GTING BETTER. AND THEN THE OTHER THING, AND PARTICULARLY IN OUR INDUSTRY, I THINK SUSTAINABILITY WILL BE EVEN MORE IMPORTANT. BOARDS ARE LOOKING AT SUSTAINABILITY. DIFFERENT SUSTAINABILITY METRICS ARE BEING ADOPTED INDUSTRYWIDE, AND I THINK YOU'RE GOING TO SEE MORE CONFORMITY IN TERMS HOW SUSTAINABILITY HELPS IMPACT HOW INDUSTRIES ARE RUN AND MANAGED BUT ALSO HOW THAT VALUE-ADD HITS THE BOTTOM LINE FROM A SUSTAINABILITY STANDPOINT >> SHANNON NASH, WING CHIEF FINANCIAL OFFICER, AND OUR VERY OWN DIANE KING HALL, EXCITING TO HAVE THIS CONVERSATION WITH YOU. APPRECIATE IT. >>HANK YOU. >>> WELL, SOME LEADERSHIP SHAKE-UPS AT SHAKE SHACK TODAY. THE FOOD CHAIN ANNOUNCING ITS CEO IS STEPPING DOWN AFTER MORE THAN TWO DECADES AT THE COMPANY. RUDY IS GOING TO RETIRE NEXT YEAR. UNTIL THEN, HE WILL STAY IN HIS ROLE TO HELP CHOOSE A SUCCESSOR. AFTER HE RETIRES, THE COMPANY PLANS TO KEEP HIM ON AS AN ADVISOR IN THE END OF 2024 TO TRANSITION THE NEW CEO. SO, A SHAKE-UP IN THE SHAKE SHACK LAND AND ULTIMATELY IN BURGERLAND. IN A MESSAGE, HE DID SAY, "I NEVER QUITE KNEW WHEN THIS DAY WOULD COME, BUT IN HIS HEART, ARRIVING AT THE REALIZATION FOR HIM, THE FAMILY, THE COMPANY, THIS IS THE RIGHT TIME AND ULTIMATELY 24 YEARS AGO, DANNY MEYER HIRED HIM AND SAID, I'M NOT SURE YOU'RE READY FOR THIS, BUT I'M GOING TO GIVE YOU A SHOT TO LEAD TABLA, THE INDIAN RESTAURANT FRONTING MADISON SQUARE GARDEN IN MANHATTAN, AND TH OVEIME, DANNY CONTINUING TO GIVE HIM A SHOT. SO, REALLY JUST SHOWING HOW SOME OF THE OTHER LEADERS IN THE INDUSTRY POURING INTO HIM AND THEN GIVING HIM THIS -- GETTING HIM INTO THE MINDSET TO RUN A SHAKE SHACK. >> YEAH, DANNY MEYER WAS CERTAINLY OR HAS CERTAINLY BEEN A REAL MENTOR, I THINK, TO HIM . YOU MENTIONED THE FACT THAT HE WAS A GENERAL MANAGER OF TABLA IN UNION SQUARE CAFE, ACTUALLY THE YOUNGEST EVER GENERAL MANAGER THERE, SO IT REALLY SPEAKS TO THE CONFIDENCE THAT DANNY MEYER HAD IN HIM OR HAS HAD IN HIM NOW FOR YEARS AND HOW QUICKLY HE HAS BEEN ABLE TO SCALE SHAKESHACK'S BUSINESS. IT'S INTERESTING WHEN YOU TAKE A LOOK AT THE SHARE PRICE REACTION TO THIS NEWS, THERE'S OPTIMISM ON THE STREET FOR WHAT IT COULD MEAN FOR THE BUSINESS. I WAS LOOKING AT SOME OF THE ANALYST REACTION TO THIS NEWS, AND COWEN WAS OUT SAYING THAT THERE IS AN OPPORTUNITY HERE TO HIRE AN EXECUTIVE THAT DOES HAVE A PROVEN TRACK RECORD IN SCALING GROWTH, AND A LOT OF TIMES, WHEN WE TALK ABOUT SHAKE SHACK, IT'S EXACTLY WHAT NEEDS TO BE DONE IN ORDER TO FURTHER SCALE THAT GROWTH AND CAPITALIZE ON SOME OF THE SUCCESS THAT THE COMPANY HAS SEEN OVER THE LAST SEVERAL YEARS. SO, THE FACT THAT NOW THEY COULD HAVE THE OPPORTUNITY TO DO THIS WITH SOMEONE FROM THE OUTSIDE COMING IN, HAVING A CLEAN SLATE, TAKING A FRESH LOOK AT SHAKE SHACK'S FUNDAMENTALS, SEEING EXACTLY WHERE THEY CAN EXCEED, WHERE MAYBE IT MAKES SENSE FOR MORE OF A STRATEGIC SHIFT AWAY FROM THEIR CURRENT OFFERINGS AND RIGHT NOW THE FACT THAT THEY CAN START ALMOST FROM -- NOT FRO SCRATCH BUT FROM A BRAND-NEW PERSPECTIVE HERE AND REALLY HAVE THE ABILITY TO LAUNCH A SHAKE SHACK INTO THE NEXT PHASE, I GUESS, OF ITS GROWTH, COULD BE AND SEEMS TO BE SOMETHING THAT THE STREET IS ENCOURAGED ABOUT FOR NOW. >> I'LL ROUND THIS OFF WITH THREE THOUGHTS THAT I THINK AND THREE MAJOR IMS THA WHOEVER THE NEXT CEO IS GOING TO HAVE TO THINK ABOUT. IT'S APPETITE. IT'S PRICE. AND IT'S TECHNOLOGY. YOU'VE GOT MORE PEOPLE WHO ARE LOOKING ACROSS WHAT THE DELIVERY MECHANISMS ARE AND THE TECHNOLOGY THAT'S INFUSED INTO THAT EXPERIENCE. YOU'VE GOT THE APPETITE WITH SOME OF THE WEIGHT LOSS DRUGS THAT WE HAVE BEEN TALKING ABOUT, THAT COULD SHIFT, AND YOU'VE GOT THE PRICE THAT CONSUMERS, ESPECIALLY GOING INTO A POTENTIAL RECESSION, ARE GOING TO TRY TO FIGURE OUT, DO I WANT TO PAY $18 FOR A BURGER, FRIES, AND A REALLY GOOD ROOT BEER FLOAT AT THE END OF THE DAY? >> I WAS GOING TO SAY, THAT AND ALSO TACK ONONE RE. DRIVE-THRUS. WHY DON'T THEY HAVE MORE? THEY SHOULD. A LOT OF TIMES, PEOPLE GO THERE BECAUSE IT'S CONVENIENT, QUICK IN AND OUT, EVEN BETTER. >> JUST THROW IT AT ME. I'LL CATCH IT. ALL YOUR MARKETS ACTION AHEAD. STAY TUNED. YOU'RE WATCHING YAHOO! FINANCE. >>> BASEBALL FANS WITNESSED AN HISTORIC DEAL OVER THE WEEKEND. SHOHEI OHTANI HAS OFFICIALLY SIGNED A RECORD-BREAKING $700 MILLION, TEN-YEAR DEAL WITH THE LOS ANGELES DODGERS. THE DEALS NO ONLY MAKING BASEBALL HISTORY BUT ALSO TOPS PATRICK MAHOMES' $450 MILLION DEAL IN THE NFL, MAKING IT THE LARGEST NORTH AMERICAN PROFESSIONAL SPORTS HERE. NOW, THERE'S A FEW THINGS THAT COME TO MIND. NUMBER ONE, THIS IS NOT JUST A SUPERSTAR IN BASEBALL BUT AN INTERNATIOLLYNOWN SUPERSTAR, SO HE'S GOT INTERNATIONAL MARKETABILITY HERE. WE WERE TALKING WITH KENNY SMITH ABOUT VICTOR WEMBANYAMA BEFORE HE EVEN PLAYED ONE GAME IN THE NBA SAYING THAT HE IS MORE MARKETABLE AT THIS STAGE ENTERING INTO THE LEAGUE THAN LeBRON JAMES BAUSEE HA THAT INTERNATIONAL PRESENCE EVEN PRIOR TO GETTING TO THE LEAGUE. SO, SHOHEI OHTANI HAS THAT. HE ALSO, EVEN WITHIN THIS SUPERS SUPERSTARDOM IS LOOKED AT AS SOMEONE WHO'S GOING TO GROW THE ECONOMY OF LOS ANGELES. IT'SHOWTE IN.A.LL OVER AGAIN NOW THAT YOU HAVE SHOHEI OHTANI THAT'S GOING TO BE OUT THERE. YOU'VE GOT LeBRON JAMES THAT'S GOING TO BE OUT THERE. YOU GOT BRONNY AT USC. YOU'VE GOT SOME STARS, ABSOLUTELY. I'M EXCITED. >> NOTHING NEW FOR L.A., THOUGH. THERE'S ALWAYS A BUNCH OF CELEBS. BUT YEAH, I THINK THIS POINTS TO A LOT OF THINGS. ONE, IT'S CRAZY JUST TO WRAP YOUR HDROUND THE FACT AT HOW HIGH THESE CONTRACTS ARE, ESPECIALLY WHEN YOU TAKE A LOOK AT A LOT OF THE LARGEST ONES THAT HAVE BEEN REACHED OVER THE LAST SEVERAL YEARS IN THE MLB FOR BASEBALL. TWO, THOUGH, WHAT EXACTLY IT'S GOING TO DO NOT ONLY FOR THE LOCAL ECONOMY BUT ALSO FOR THE TEAM IN TERMS OF THE FANDOM AND SELLING OUT CROWDS, A LOT OF THE EXCITEMENT THAT IS GENERATED AROUND ONE OR TWO STAR PLAYERS, NOW THAT THEY TO HAVE OHTANI, THE MASSIVE CONTRACT, $700 MILLION OVER TEN YEARS, THEY THEY ARE BANKING ON HIM FOR SUCH A LONG TIME. I DON'T THINK IT'S A HUGE SURPSE GEN T PERFORMANCE HE'S PUT UP, BUT TWO, WHAT IT COULD MEAN FOR THE ORGANIZATION DOWN THE LINE AND HOW CONFIDENT THEY ARE IN OHTANI'S ABILITY TO REALLY FURTHER BUILD L.A. DODGERS AND EXACTLY WHAT THE TEAM'S GOING TO LOOK LIKE HERE FOR YEARS TO COME. >> I'M LOOKING UP NONSTOP FLIGHTS FROM ASIA PACIFIC TO L.A. I THINK THAT'S GOING TO BE ONE AREA TO KEEP YOUR EYE ON RIGHT NOW. THOUSAND DOLLARS FOR NONSTOP FLIGHTS. >> OHTANI CAN AFFORD A HECK OF A LOT OF THOSE. YOU BRING UP A GOOD POINT IN TERMS OF THE INTERNATIONAL PRESENCE, AND EXACTLY WHAT THAT DOES FOR A TEAM. A MASSIVE OPPORTUNITY. >>> LET'S DO A QUICK CHECK O THE TRADING DAY. YOU'RE STILL LOOKING AT A PRETTY MIXED PICTURE, NOT TOO FAR FROM THE FLAT LINE. YOU HAVE THE NASDAQ OFF ABOUT 0.1%, SO OFF THE LOWS OF THE SESSION SO FAR. YOU HAVE THE DOW UP JUST OVER 100 POINTS. KEEP IT RIGHT HERE ON YAHOO! FINANCE. MORE TO COME NEXT HOUR. LIVE. IT'S 11:00 A.M. ON THE EAST COAST. 8:00 A.M. ON THE WEST. I'M JARED BLIKRE ALONG WITH DIANE KING HALL. MACY'S BOARD IS MULLING OVER A $5.8 BILLION BUYOUT OFFER. THE REAL ESTATE HOLDINGS COULD BE THE REAL VALUE FOR INVESTORS. >> AND KEY INFLATION DATA IS ON TAP TOMORROW. WHAT TENDS TO HAPPEN WITH THE MARKETS AROD CPI REPORTS? WE'LL DISCUSS. >>> PLUS AN IPO ANNIVERSARY, WE'RE GOING TO SPEAK WITH THE CFO OF HILTON, TEN YEARS AFTER THE DEBUT. HOW HAS THE HOSPITALITY INDUSTRY CHANGED AND WHAT'S TO CO. >>> LET'S LOOK AT HOW MARKETS ARE TRADING IN THE EARLY ACTION. YOU'VE HAD A MIXED MARKET WITH THE DOW ON THE PLUS SIDE WITH JUST 3/10 OF THE PERSONALITY. NASDAQ TRADING IN THE REVERSE DIRECTION, DOWN .2%. INVESTORS TRYING TO READ THE TEA LEAVES AHEAD OF THE LAST MEETING O. OF THE YEAR. LET'S LOOK AT THEEN-YR IN PARTICULAR. LOOKING AT YIELDS UP 3 BASIS POINTS THERE. NOT A LOT OF ACTION OVER IN THE BOND MARKET AS WELL. AGAIN, INVESTORS JUST KIND OF COOLING THEIR HEELS AHEAD OF THE FED'S LAST MEETING OF THE YEAR. >> LAST ONE. WE GOT TO TALK TAIL BECAUSE THE MACY'S BOARD IS MULLING A $5.8 BILLION BUYOUT OFFER. THE RETAILERS BEAT EXPECTATIONS IN ITS RECENT QUARTER, LARGE SCALE DEPARTMENT STORES HAVE HAD A TOUGH GO OF IT IN RECENT YEARS, STRUGGLING TO COMPETE AS SHOPPERS INCREASINGLY BUY ONNE. ANOTHER MAJOR NAME, JCPENNEY MADE HEADLINES WHEN IT FILED FOR BANKRUPTCY. THE TWO BRANDS DIFFER IMMENSELY, WHAT CAN JCPENNEY'S WOES TELL US ABOUT THEATH AHEAD FOR MACY'S. BROOKE DiPALMA HAS MORE. >> THERE'S LOTS TO CONSIDER. BOTH COMPANIES, MACY'S AND JCPENNEY, CENTURY OLD COMPANIES, MACY'S 165 YEARS OLD. JCPENNEY, 121EARS OLD. THEY BOTH FACED WOES IN THE PANDEMIC WHEN eCOMMERCE BEGAN TO BOOM. JCPENNEY'S FILING FOR BANKRUPTCY AND GOING PRIVATE. MACY'S WAS APPROACHING BANKRUPTCY BUT AVOIDED THAT AFTER SECURING $4.5 BILLION IN FINANCING. SINCE JC PENNY'S WENT PROOIVATE THEY HAD A REAL ESTATE STORY OF 676 STORES. WE SPOKE TO THE CEO. HE SAID THEY'REOMFOABLE WITH THE STORE PORTFOLIO AND THE SIZE OF THE STORES. WE KNOW THAT THEY HAVE BEEN ABLE TO MAKE AN OVER $1 BILLION INVESTMENT TO MODEL STORES AS CONSUMERS SHOP IN STORE AND ONLINE. NOW, WHAT'S DIFFERENT HERE IS THAT MACY'S HAS A VERY RUST REAL ESTATE PORTFOLIO WITH WHAT ONE ANALYST CALLED A TROPHY ASSET BEING HERALD SQUARE. WHAT'S DIFFERENT THERE IS THE REAL ESTATE VALUE ACCORDING TO JPMORGAN IS $8.5 BILLION. THAT HERALD SQUARE FLAGSHIP COULD BE WORTH AT LEAST $3 BILLION. AN MY REALLY FOCUSED ON THAT BILLION DOLLAR REAL ESTATE PORTFOLIO THAT IT HAS, ROUGHLY MORE THAN 700 LOCATIONS. MORE THAN 500 MACY'S, MORE THAN 10BLUE MERCURY SKOTORES, THE COSMETIC STORE. MACY'S DOES HAVE AN INCOMING CEO, TONY SPRING WHO HAD COME FROM BLOOMINGDALES AND HE'S LOOKING AT A LEANER STORE PORTFOLIO. THEY HAVE BEEN LEANING IN INTO SMALLER FOOTPRINT, AND SO REALLY OKINAT THIS REAL ESTATE PORTFOLIO AS THAT PRIME ASSET THAT MACY'S HAS GOING INTO THIS POTENTIAL DEAL AND/OR HOW IT COULD STAND OUT AMONG OTHER DEPARTMENT STORES THAT REALLY HAVEN'T SEEN THE CURRENT DAY. WE'RE THINKING, SEARS, TOYS “R” US, AS PARTNT SRES GO BEHIND THE REAR VIEW MIRROR, HOW IS MACY'S MOVING FORWARD WITH THE ROBUST REAL ESTATE PORTFOLIO. >> THEY HAVE A ROBUST REAL ESTATE PORTFOLIO. THE DIFFERENCE BETWEEN A JCPENNEY AND MACY'S, THEY'VE ALSO GOT BLOOMINGDALE. >> LUXURY RETAIL ASSET TO IT. >> Y, THEY HAVE SOME BRAND POWER. BUT IN GENERAL WHEN YOU THINK ABOUT THIS, IT'S IN CONSUMER BUYING PATTERNS. WHAT DOES THIS TELL YOU ABOUT WHERE THE CONSUMER STANDS NOW, THIS KIND OF DEAL? >> YEAH, WELL SPEAKING OF WHAT MACY'S HAS UNDER ITS BELT, BLUE MERCURY, WE CONTINUE TO SEE A CONSUMER LEANING INTO BEAUTY DESPITE THE PRESSURE THEY'RE UP AGAINST. THEY CONTINUE TO SEE PRESSURE AGAINST THEIR CONSUMER. WE ALSO DID HEAR OF CREDIT CARD RATE DLELINQUENCIES RISING. THEY'RE SEEING A HEALTHY CUSTOMER, HAVEN'T SEEN A SIGNIFICANT CHANGE TO THEIR CUSTOMER. AS WE LOOK TOWARDS 2024, INFLATION REMAINS A KEY FOCUS FOR CONSUMERS. THEY'RE ALSO LOOKING AT ALTERNATIVE PAYMENT OPTIONS. eCOMMERCE CONTINUES TO SEE A BOOM. REALLY HERE IT'S HOW EXACTLY MACY'S WILL CONTINUE TO BRING CUSTOMERS IN STORE AND PRMOTIONS AND VALUE CONTINUE TO BE THE NAME OF THE GAME AS CAN'T PAY UP LIKE THEY USED TO. >> I SAW JCPENNEY COMING. MACY'S HAS BEEN IN PLAY BEFORE. WE'LL SEE WHAT HAPPENS. BROOKE DiPALMA, THANK YOU. >> ABSOLUTELY. >>> AN INVESTOR GROUP HAS PUT FORTH A $5.8 BILLION BID FOR PARTMENT STORE CHAIN MACY'S. PERHAPS THE MOST NOTABLE ASSET THE COMPANY HOLDS, ITS SIZABLE REAL ESTATE PORTFOLIO, BETWEEN THE MACY'S BRAND, BLOOMINGDALES AND BLUE MERCURY. MACY'S OPERATES 700 LOCATIONS, INCLUDING ITS ICONIC HERALD SQUARE LOCATION. WHERE CAN T RETAILER WIN WITH ITS PORTFOLIO. WE WANT TO BRING IN RICHARD KESINGBAUM. THANK YOU FOR JOINING US. WHEN YOU THINK ABOUT THIS DEAL, WHAT DOES THIS TELL YOU ABOUT WHERE MA'S IN TERMS OF THE RETAIL SPACE? >> THE CONSUMER IS CHANGING, AND CONSUMERS DON'T WANT TO SHOP WHERE THEIR PARENTS SHOPPED. THEY WANT NEW VENUES, AND THAT'S BEEN CHALLENGING FOR THE DEPARTMENT STORE BUSINESS. AND SO WHAT YOU SEE IS OTHER PEOPLE TAKING A DIFFERENT LOOK AT THE ASSETS OF DEPARTMENT STORES, AND TRYING TO FIGURE OUT HOW DO WE MAKE THIS INVESTMENT WORTHWHILE. THAT MAY NOT MEAN THAT THEY GROW OR HAVE A NEW FORMULA FOR THE DEPARTMENT STORE BUSINESS AS YOU GUYS HAVE BEEN VERY WELL SCRIBING, THEY MAY HAVE A DIFFERENT STRATEGY FOR THE FUTURE OF THE BRAND. THEY HAVEN'T TOLD US WHAT THAT IS, BUT SEEMS LIKELY THAT THAT'S THE CASE. >> CAN WE ASK ABOUT VALUATION HERE, $5.8 BILLION. I HAVE HEARD RUMBLINGS AMONGST ANALYSTS THAT THE NUMBE A LITTLE BIT LOW. IT APPEARS AS THOUGH, THE BUYER, THE INVESTMENT GROUP, COULD BE WILLING TO PAY A LITTLE BIT MORE. WHAT ARE YOUR THOUGHTS ON THIS? IN TERMS OF THE VALUATION, WHAT DOES THIS DEAL LOOK LIKE? >> THEY HAVE COME IN WITH A PREMIUM THAT'S NOT EXCEPTIONALLY HIGH, AND I WOULD NOT BE SURPRISED IF THE BID GOES UP BEFORE IT'S OKAY, IF IT DOES GO FORWARD OR THAT SOMEONE ELSE >> IF SOMEONE ELSE COMES IN, WHO COULD POTENTIALLY COME IN AS SAY EVEN A DARHORSBID, RICHARD? >> IN MOST INDUSTRIES, YOU WOULD BE LOOKING FOR SOMEONE STRATEGIC. I WOULD NOT EXPECT THAT HERE. I THINK ANYBODY WHO'S IN OR KNOWS THE DEPARTMENT STORE BUSINESS HAS THEIR HANDS FULL, AND I WOULD EXPECT ANOTHER FINANCIAL BIDDER IF THERE'S GOING TO BE ANOTHER BIDDER. I'M NOT SAYING THERE IS, BUT IF THERE IS I WOULD EXPECT IT TO BE ANOTHER FINANCIAL BIDDER. >> ARE WE SEE ING NOW WITNESSIN THE DECLINE OF RETAIL DEPARTMENT STORE, TRADITIONAL BRICK AND MORTAR RETAIL, AND THIS IS ONE OF THE LAST GASPS. HOW DO YOU SEE THIS TRANSTION FI TRENDS WITHIN REAL ESTATE AND DEPARTMENT STORE LANDSCAPE? >> IT'S NOT UNLIKE YOUR BUSINESS, AND WHAT I MEAN BY THAT IS 20 YEARS AGO WE SAW FINANCIAL BIDDERS BUYING UP NEWSPAPERS. THAT DIDN'T MEAN THE E OF JOURNALISM. HERE YOU ARE. BUT IT DID MEAN THE DECLINE OF A CERTAIN WAY OF CONDUCTING NEWS AND MEDIA THAT CHANGED OVER TIME, AND WE'RE SEEING THAT IN RETAIL, AND WHEN FINANCIAL BUYERS COME IN, IT'S AN OUTSIDERS VIEW THAT ALLOWS CHANGES TO ACCELERATE AS WE SAW IN THE MEDIA BUSINESS. >> AND THEN, RICHARD, I WANT TO ASK YOU, BIG PICTURE HERE, WHEN YOU THINK ABOUT, SAY, AS YOU MENTIONED, WE HAVE BEEN WATCHING THE REAL ESTATE LANDSCAPE CHANGE TREMENDOUSLY, AND YOUNG PEOPLE SAY GENERATION Z ARE NOT SHOPPING LIKE MILLENNIALS, BOOMERS, GEN X, WHAT DOES THIS MEAN BIG PICTUREOR T RETAIL LANDSCAPE, AND ALSO I WANT TO THINK ABOUT THE PREMIUM OF THE PRICE THAT IS BEING PUT ON OFFER HERE. COULD THIS ACTUALLY EVEN GO HIGHER? >> WELL, IN TERMS OF HOW CONSUMERS SHOP, WHAT CONSUMERS WANT IS PERSONAL VALUES. THEY WANT TO LK AT BRANDS AND COMPANIES AND RETAILERS AND PRODUCTS AND SEE THEIR OWN PERSONAL VALUES REFLECTED IN THEM. THEY WANT TO HEAR ABOUT THE ENVIRONMENT AND SUSTAINABILITY AND FAIR LABOR PRACTICES AND LOCAL PRODUCTION, AND ALL THE THINGS THAT MEAN SOMETHING TO THEM. THAT'S EXTREMELYARD TO DO IF YOU'RE A DEPARTMENT STORE BECAUSE THE ASSORTMENT IS SO BROAD THAT IT'S HARD TO GET PERSONAL AND THE RANGE OF BRANDS BY DESIGN IS MEANT TO BE ENPSYCH L -- ENPSYSO WHEN YOU THINK ABOU THOSE PERSONAL VALUES, IT'S NOT SURPRISING THAT DEPARTMENT STORES ARE NOT AS DESIRABLE AS THEY ONCE WERE. IN TERMS OF VALUE,YEAH, AS I WAS SAYING A FEW MINCE UTES AGO WON'T BE SURPRISE FIRSTD IF A FINANCIAL BIDDER COMES IN AT A HIGHER VALUE. >> WE HAVE TO LEAVE IT THERE. APPRECIATE YOUR INSIGHTS, RICHD CAPITAL COFOUNDER AND PARTNER. >> THANKS, GREAT TO BE WITH YOU. >>> SHARES OF PARAMOUNT SEEKING WHEN IT COMES AMID A "NEW YORK TIMES" REPORT THAT SHERRY REDSTONE, THE DAUGHTER OF SUMNER REDSTONE IS LOOKING TO SELL HER STAKE IN PARAMOUNT'S COMPANY, SHARES POPPED ON REPORTS THAT SKY DANCE AND RED BIRD WERE EXPLORING A POSSIBLE TAKEOVER. >> THIS IS SOMETHING THAT'S BEEN TALK ABO FOR WHI IS THE POTENTIAL FOR PARAMOUNT TO GO, TO BE A TARGET FOR SALE. SHERRY REDSTONE HAS WANTED TO HOLD ON TO THIS PROPERTY. "NEW YORK TIMES" SAYING THAT THIS IS THE FIRST TIME AN OFFER HAS BEEN SERIOUSLY UNDER CONSIDERATION. ONE OF THE ISSUES, OBVIOUSLY, HAS BEEN THE FRACTURED AD MARKET. THAT'S ONE OF THE CHALLENGES FOR THE INDUSTRY IN GENERAL, BUT DEBT OBLIGATIONS WHEN IT COMES TO PARAMOUNT. >> REAL QUICK, IF WE GO TO THE WI-FI INTERACTIVE. THIS IS MY HEAT MAP I HAVE COMPILED. DON'T TAKE THI AS SOMETHING THAT'S COMPREHENSIVE, BUT YOU CAN'T SEE PARAMOUNT. IT'S IN THE LOWER RIGHT, AND THAT'S BECAUSE MARKET CAP HAS DWINDLED. THIS LOOKS LIKE A FOR SALE. HERE'S PARAMOUNT OVER THE LAS MONTH, UP 34%. WE HAVE SEEN A GAME OF CATCH UP FROM THE LAGGARDS AND A LOT OF COMPANIES ARE ENJOYING THE RIDE. THIS DEAL WAS A LOT CHEAPER A MONTH AGO, WE'LL HAVE TO SEE, MAYBE THE TIMING IS SUCH THAT SHE FEELS SHE CAN GET SHARI REDSTONE A LITTLE BIT MORE MONEY HERE. >> WE HAVE MORE OF YOUR MARKETS ACTION AHEAD. STAY TUNED, YOU'RE WATCHING YAHOO! FINANCE. >>> STOCKS ARE MIXED THIS MONDAY MORNING. THE MARKET CATALYST ARE ABOUT TO KICK IN TOMORROW, BECAUSE WE HAVE CPI, CONSUMER PRICE INDEX DATA AND WE'RE GOING TO BREAK WN WHAT THIS MEANS FOR THE MARKET. I HAVE A CHART HERE FOR THE S&P 500 GOING ALL THE WAY BACK, AND THAT'S IN PURPLE, BY THE WAY, GOING BACK TO APRIL OF 2020. YOU CAN SEE THOSE PANDEMIC LOWS THERE. WHAT I HAVE DONE WITH THE CYAN BLUE LINE, THE GAINS AND LOSSES IN THE STOCK MARKET, REPRESENTED BY THE SPY, WHICH CRACKS THE S&P 500. YOU CAN SEE THESE GAINS AS THEY FLUCTUATE WITH THE OVERALL MARKET. WHEN WE HAD THE GREAT BULL MARKET IN THE PANDEMIC, WE DID SEE CPI DAYS, THEY TRADED KIND OF FLAT, AND THEN LAST YEAR WHE WE HAD INTEREST RATE INCREASES AND BEAR MARKET, WE DID SEE CPI DAYS TRADE TO THE DOWNSIDE. IMPORTANTLY, LAST OCTOBER, IN FACT, THE DAY WE WERE COMING OFF THE LOW, THAT BIG KICK TO KICK START THIS RALLY THAT WE HAD, THAT CAME WITH THE CPI REPORT, AND IN FACT, THIS BIG GAIN HERE WAS NOT ONLY MATCHED BUT EXCEEDED A MONTH LATER WITH A BIGGER GAIN, AND SO ARGUABLY, CPI HAS PLAYED AN IMPORTANT PART IN THE RALLY THIS YEAR. IN THE S&P 500, AND SPY THAT TRACKS IT, IT'S 5% OF THE GAIN. HAD YOU BEEN IN THE MARKET ON CPI DAYS, YOU WOULD BE UP 5% THIS YEAR. THAT'S SIGNIFICANT, CONSIDERING WE HAVE NON-FARM PAYROLLS ON THE EMPLOYMENT FRONT, AND ALSO THE FED, WE HAVE A MEENGHIS WEEK. AMONG THOSE THREE, WE HAVE THE BIGGEST DRIVERS OF THE MARKET THIS YEAR, AND BY FAR, CPI HAS BEEN THE BIGGEST DRIVER OF THOSE THREE. JUST WANT TO GO OVER REAL QUICK, THE SECTOR ACTION OVER THE LAST MONTH. WE HAVE SEEN A HUGE INCREASE IN REAL ESTE, CSUMER DISCRETIONARY, THAT'S RETAIL, THAT KIND OF TIES INTO THE PRICES WE'RE GOING TO BE GETTING TOMORROW THAT CONSUMERS FACE. INDUSTRIALS, FINANCIALS, MATERIALS, UTILITIES, BASICALLY A BROAD SWATH OF SECTORS THAT WERE UNDERPERFORMING HAVE SUDDENLY PERKED UP. THAT'S WHAT WE'RE FACING GOING INTO THE NEW YEAR. >> THAT WAS A GREAT BREAKDOWN AS USUAL, JARED. >>> DESPITE STOCKS MIXED PICTURE THIS MORNING, MARKETS HAVE SEEN SERIOUS MOMENTUM WITHIN THE LAST WEEK AS ALL THREE MAJOR INDEXES HAVE FINISHED THE LAST SIX WEEKS WITH GAINS. OUR NEXT GUEST SAYS SHE'S NOT KEEN ON CHASING THIS RALLY, AND MAYBE YOU SHOULDN'T BE EITHER. WE WANT TO BRING IN VERONICA WILLIS, INVESTMENT STRATEGY ANALYST AT WELLS FARGO INVESTMENT INSTITUTE TO WEIGH IN HERE. VERONICA, OBVIOUSLY WE'VE SEEN SOME KIND OF FOMO ACTION IN PLAY. ANHEN U SEE SOMETHING LIKE THAT, WHAT SHOULD WE BE WARY OF? >> I THINK RIGHT NOW THE REALLY BIG WARNING IS WHAT'S GOING TO HAPPEN WITH THE ECONOMY. WE'RE EXPECTING THE ECONOMY TO CONTINUE WEAKENING INTO EARLY NEXT YEAR, AND I THINK T MARKET HAS PRICED IN A DIFFERENT SCENARIO, SO THERE IS SOME DOWNSIDE VOLATILITY POTENTIAL THERE. I THINK IT'S GOING TO BE HARD TO GET THIS GOLDILOCKS SCENARIO, THAT THE ECONOMY IS GOING TO BE OKAY. I DON'T THINK THAT'S THE MOST LIKELY SCENARIO. >> IF THAT'S NOT THE MOST LIKELY SCENARIO, HOW DOES AN INVESTOR POSITION THEMSELVES, HOW DO INVESTORS GET DEFENSIVE IN THIS MARKET? >> IT'S SMART TO TAKE THAT DEFENSIVE POSITIONING. WE FAVOR LARGE CAP OVER MID AND SMALL CAP. THE LARGE CAP SPACE OUTPERFORMING MID AND SMALL CAP EQUITIES. FROM A SECTOR PERSPECTIVE, WE LIKE INDUSTRIALS, WE LIKE STR INDUSTRIALS, AND WE LIKE HEALTH CARE. SOME OF THE AREAS THAT ARE GOING TO PERFORM WELL IN AN ECONOMIC SLOWDOWN, IN THE CYCLICAL RECOVERY TYPE OF POSITIONINGS. >> WANTO TK ABT THE BOND MARKET, SAFE SECTORS FOR YOUR MONEY. THE THREE-YEAR STRETCH HAS BEEN A DEBACLE FOR 60/40 INVESTORS. IS IT TIME TO START WEIGHED INTO THE BOND MARKET, WHAT DO YOU SEE FOR THE NEW YEAR, ESPECIALLY CONSIDERING WE HAVE SEEN THE HUGE RUN UP OVER THE LAST MONTH, A GAME OF CATCH UP IN BONDS. >> YEAH, SO FOR THOSE INVESTORS WHO HAVE AN OBJECTIVE OF INCOME, THE BOND MARKET IS ACTUALLY A GOOD PLACE FOR YOU RIGHT NOW BECAUSE YOU'VE GOT THOSE HIGHER YIELDS THAT WE HAVEN'T EXPERIENCED THIS DECADES, BUT THEN FOR THOSE 60/40 TYPES OF INVESTORS, WE HAVE BEEN ENCOURAGING EXPOSURE TO SOME AREAS OUTSIDE OF ADDITIONAL STOCK AND BOND MARKETS TO GIVE YOU A LITTLE BIT OF THAT DIVERSIFICATION. THINKING OF THE COMMODITIES AREA, THINKING OF SOME ALTERNATIVES TO HELP PROTECT YOU WHEN BOND PRICES RISE, AS THE ELDS GO HIGHER. BUT THEN LOOKING INTO NEXT YEAR, WE DO THINK THE FED WILL EVENTUALLY BE ABLE TO CUT RATES, YIELD WILLS COME DOWN, AND THAT WILL BENEFIT THOSE BOND INVESTORS. GETTING IN NOW WHILE YOU'RE ABLE TO GET THOSE ATTRACTIVE YIELDS, REMEMBERING IF YOU'RE HOLDING AT BOND TO MATURITY, YOU'VE GOT THAT STEADY INCOME, BUT THEN YOU ALSO WILL GET THE PRINCIPLE BACK WHEN THE TERM EXPIRES. >> WE KNOW WALL STREET IS ON FED WATCH FOR THE LAST MEETING OF THE YEAR, VERONICA. WHAT ARE YOU THINKING OR HOW ARE YOU POSITIONING IN 20 IN PARTICU FED WOULD START CUTTING. >> I THINK WHEN WE SEE THE EVIDENCE THAT THE ECONOMY IS ACTUALLY SLOWING, THAT'S WHEN THERE CAN BE A LITTLE BIT MORE CONFIDENCE THAT THE FED CAN CUT. THE ECONOMY IS DOINGOKAY. IT DOESN'T SEEM LIKELY THAT THE FED WILL START TO EASE, WHILE IT APPEARS THAT CONSUMERS IN THE LABOR MARKET CAN HANDLE THE CURRENT LEVEL OF RATES, AND WE HAVE HEARD COMMENTARY FROM FED OFFICIALS TO THAT EFFECT. I THINK IT WILL BE REALLY KEY TO SEE WHAT FED OFFICIALS ARE SAYING, IF THIS IS GOING TO BE MORE OF A HAWKISH HOLD OR ARE THEY GOING TO START BEING A LITTLE BIT MORE DOVISH WITH THEIR LANGUAGE. >> LET ME ASK YOU BEFORE WE GO, TIME FOR ONE MORE, WE HAVE BEEN TALKING A LOT ABOUT THE BOND MARKET, BUT ALSOM WANT TO TALK ABOUT YOUR PORTFOLIO RECOMMENDATIONS FOR THE NEW YE. WHERE DO YOU SEE 2024 EVOLVI AND WHAT KIND OF SECTORS ARE YOU LOOKING AT FOR THE NEW YEAR? >> WE RECENTLY RELEASED OUR 2024 OUTLOOK, AND WE TALK A LOT IN THAT OUTLOOK ABOUT THE TALE OF TWO HALVES, WHERE IN THE FIRST HALF OF THE YEAR, YOU WANT TO BE POSITIONED TO BE DEFENSIVE, SO THAT'S WHERE WE LIKE LARGE CAP OVER SMALL CAP, AND WE LIKE THE HEALTH CARE, MATERIALS AND INDUSTRIAL SECTORS. THE ECONOMY WILL RECOVER, WE'LL TAKE MORE OR MAYBE SMALL CAPS WILL START TO OUT PERFORM IN THAT EARLY RECOVERY STAGE. >> HAVE TO LEAVE ITHERE. REALLY APPRECIATE YOUR INSIGHTS. VERONICA WILLIS, INVESTMENT STRATEGY ANALYST AT WELLS FARGO INVESTMENT INSTITUTE. ALL YOUR MARKETS ACTION STRAIGHT AHEAD, STAY TUNED, YOU'RE WATCHING YAHOO! FINANCE. >>> ANOTHER DEAL IN THE OIL AND . OCCIDENTAL PETROLEUM IS BUYING CROWN ROCK, THE DEAL EXPECTED TO CLOSE IN 2024. THIS COMES AFTER SEVERAL ENERGY CONSOLIDATION, INCLUDING EXXON BUYING PIONEER, AND CHEVRON ACQUIRING HES. OUR NT GST WAS BETTING BIG ON OCCIDENTAL. HIS FIRM'S LARGEST HOLDING IN THE PORTFOLIO IS THE PETROLEUM COMPANY. WE WANT TO BRING IN CEO OF SMEED CAPITAL MANAGEMENT. THANK YOU SO MUCH FOR JOINING US AS UAL. IT WOULDN'T BE MERGER MONDAY WITHOUT A DEAL TO TALK ABOUT. LET'S JUMP INTO THE LATEST. THERE HAVE BEEN OBVIOUSLY A LOT OF CONSOLIDATION THIS YEAR. WHAT DOES THIS SAY ABOUT KIND OF THE STATE OF THE INDUSTRY NOW? >> YEAH, THANKS FOR HAVING ME. WHAT IT SAYS IS THAT THERE ARE ASSETS OUT THAT THAT YOU CAN BUY MORE ATTRACTIVELY THAN YOUR OWN COMPANY STOCK. USE THIS AS A PRIVATE-TO-PUBLIC TRANSACTION. IN EFFECT, THESE ASSETS ARE GOING PUBLIC INTO OCCI STOCK AT THE SAME TIME. WE'RE GOING TO CONTINUE TO SEE THE'SOT A TON OF DEALS LIKE THIS FROM PRIVATE TO PUBLIC, BUT THERE'S A LOT OF PUBLIC-TO-PUBLIC THAT HAS TO GO ON TOO. WE'RE PROBABLY GOING TO END THE 2020s WITH TEN OIL COMPANIES IN AMERICA. DO THE MATH OF WHERE WE HAVE TO GO FROM POINT A TO POINT B TO GET TO THAT. MOST OF THIS DEAL IS GOING TO BE DONE ON DEBT, BORROW AT 7 TO 8%, THE FREE CASH FLOW YIELD ON THE ASSETS IS HIGHER THAN THAT. THEY'RE FIXING IN THEIR COSTS, THEY'RE GOING TO COLLECT THE SPREAD IN BETWEEN, PAY OFF THIS, AND THE EQUITY THEY ARE BUILDING THEY'LL BUY BACK IN ONE YEAR OF FREE CASH. AS SHAREHOLDERS, OUR HANDS ARE APPLAUDING AND EXCITED ABOUT WHAT VICKY IS DOING. >> THERE'S A BERKSHIRE HATHAWAY WARREN BUFFETT ANGLE TO THIS, ONE OF THE LARGEST POSITIONS IN THE COMPANY, AND AN INTERESTING PARAGRAPH IN AN BLOOMBERG ARTICLE HAS TO DO WITH THE NEXUS BETWEEN OCCIDENTAL AND WARREN BUFFETT. IN THE RUN-UP TO THE DEAL, OCCIDENTAL'S JET FLEW FROM HOUSTON TO OMAHA, AND THEY STAYED GROUNDED FOR ABOUT THREE HOURS. IT WAS THE SECOND TIME OCCI'S JET VISITED OMAHA IN NOVEMBER, HAVING NOT PREVIOUSLY MADE THIS TRIP SINCE MAY. THIS ALMOST SEEMS TO BE A REGULAR THING. CAN YOU TALK ABOUT THE RELATIONSHIP BETWEEN BERKSHI HATHAWAY, WARREN BUFFETT AND OCCIDENTAL PETROLEUM. >> BUFFET OT OWNS 30% OF THE BUSINESS. WOULD YOU GO TO THEM AND TELL ANER IYOU VIOUSLY WOULD DOE THEM. THEY'RE TREATING THEM LIKE A LARGE TENANT SHAREHOLDER FOR THE STOCK, AND THEY SHOULD. WARREN NOT ONLY HAS PROVIDED CAPITAL AT TIMES, BUT HE'S ALSO OWNING SO MUCH OF THE BUSINESS. I THINK THAT MAKES A LOT OF SENSE. BUFFETT SAID HE DOESN'T HAVE A PLAN TO ACQUIRE OCCI. THAT'S THE OTHER THING YOU HAVE TO TAKE AGAINST IT. DOESN'T MEAN HE CAN'T BY MORE FROM THE PUBLIC. HE HAS APPROVED 50%. HE WOULD HAVE TO GO GET FEDERAL APPROVAL FOR THAT. I SAY THAT BECSE I DOE'T PRECLUDE HIM FROM BUYING MORE STOCK TODAY. VICKY IS GOING TO CALL HIM WHEN SHE'S GOING TO DO A DEAL. WOULDN'T YOU LOVE TO BE A FLY ON THE WALL IN THAT OFFICE THAT DAY. >> YES, INDEED, WOULDN'T WE CALL. COLE, YOU TALKED ABOUT THE DEBT INVOLVED IN THIS DEAL. WHAT'S THE RISK WHEN YOU THINK ABOUT ALL OF THAT LEVERAGE? >> THE RISK IS THAT IF YOU'RE STANDING THERE WATCHING OCCI DO THIS DEAL, YOU'RE ASKING YOURSELF AS AN OIL AND GAS COMPANY, WHY ARE THEY SO MUCH MORE OPTIMISTIC ABOUT THE FUTURE THAN EVERYONE ELSE? MEANF YO GO LOOK AT THE DEAL TERMS, IT'S A $12 MILLION DEAL. IT WAS 1.7 BILLION WAS GOING TO BE IN EQUITY. MOST OF THIS IS DEBT. THAT SEEMS VERY RISKY TO MOST PEOPLE, AND YET YOU WOULD HAVE TO BE OPTIMISTIC ABOUT THE FUTURE. P POSIT THAT AGAST WHAT YOU'RE SEEING. MANY STOCKS DOWN 20% IN THE LAST MONTH, DEPENDING ON WHICH STOCKS YOU LOOK AT IN THE OIL AND GAS SPACE. THEY HAVE A BRIGHT VISION OF THE FUTURE. OBVIOUSLY WARREN WOULDN'T. I DON'T THINK YOU FIND THAT ACROSS THE OIL AND GAS BENEFITS, LIKE THEY HAVE LOST THEIR MAHOOTSMA. THAT'S TO HER CREDIT AND COLLEAGUING AT OCCI, THIS IS A GREAT DEAL, AND THEY'RE GOING TO WIN THE DAY. THEY WILL BE ONE OF THOSE TEN. >> IS THE FIELD STILL RIPE FOR M&A DEALS HERE? WHO'S LEFT, AND HOW SIZABLE ARE THE DEALS? MIGHT WE GET ANOTHER SURPRISE NEXT MONDAY OR SOME MONDAY IN THE NEW YEAR. >> THERE'S ALREADY DISCUSSIONS. ENDEAVOR IS A COMPANY BEING TALKED ABOUT THAT COULD HAVE A TRANSACTION LIKE THIS GOING ON. THIS IS GOING TO CONTINUE. THIS IS A CLASSIC EXAMPLE. SINGLE BASED AND OPERATOR. IN THE PERMIAN, THAT IS A SINGLE BASIN. WHERE WE'RE GOING TO SEE THE OUTHE SINGLING BASIN ER WE CLEAR PRODUCERS, WE'RE GOING TO MULTIBASE, WHO CAN GET SCALE WHERE THEY COVER TWO OR THREE OF THE GEOGRAPHIES THEY HAVE WITH SOMEONE ELSE. THAT WILL BE THE NEXT EVOLUTION. WE HAVE TO CONSOLIDATE THE SINGLE BASINS. I'M CALLING MY BANKER SAYING WE WANT TO BE NEXT. AGAIN, THEY WOULDN'T PROBABLY BE DOING THIS WITH DEBT LIKE VICKY IS BECAUSE THEY HAVE BEEN DOING ALL STOCK DEALS. WE THINK THIS DEAL IS THE RIGHT DEAL. >> GREAT COMMENTS HERE, AND A SHOUT OUT TO VICKY SEVERAL TIMES OV FOR FPUTTING THIS TOGETHER. COLE SMEAD OF SMEAD CAPITAL. >>> DANISH PHARMACEUTICAL GIANT, NOVO NORDISK, FAMOUS FOR THEIR INTERESTING STRUCTURE. ALLIE GARFINKLE IS HERE TO BREAK DOWN EXACTLY WHAT MAKES NOVO NORDISK SO SPECIAL. >> GOOD MORNING. INVESTORS, I HAVE A BIT OF A RIDDLE FOR YOU, WHAT DO OZEMPIC AND LEGOS HAVE IN COMMON. YES,OKAY THEY'RE BOTH FROM DENMARK, YOU PROBABLY KNEW THAT. WHAT YOU MAY NOT KNOW IS THEY ARE ALSO CONTROLLED BY A FOUNDATION. THAT'S EXACTLY WHAT IT SOUNDS LIKE, A CHARITABLE ENTITY FOCUSED ON THE PUBLIC GOOD. THE KNOW VOE N-- 77% OF THE VOTING POWER. NOW FOR PRIVATE INVESTORS, AND INSTITUTIONAL INVESTORS, THOSE NUMBERS ARE GOING TO BE ESSENTIALLY REVERSED. FOR TECH INVESTS, TS MIGHT BE SURROUNDINOUNDING FAMILIAR T. IT'S SIMILAR TO A MODEL WE HAVE IN THE UNITED STATES, AND THAT'S CALLED THE DUEL CLASS SYSTEM. YOU MOSTLY SEE IT IN TECH COMPANIES, META, SHOPIFY, ALPHABET ARE ALL EXAMPLES, AND IT IS PRETTY CONTROVERSIAL. IT'S A SYSTEM WHERE THERE ARE CLASS A SHARES AND CLASS B SHARES. THE CLASS A SHARES HAVE MORE VOTING POWER, AND CLASS B ARE AVAILABLE ON THE PUBLIC MARKET. THERE ARE PROS AND CONS HERE. I HAVE TALKED TO A LOT OF ADVOCATES AND A LOT OF CRITICS. SHORT SELLERS, CORPORATE RAIDERS, ALL OF THOSE ARE NOT GOING TO BE CONCERNS IN A DUEL CLASS SYSTEM. HOWEVER, A LOT OF CRITICS WILL SAY THAT IT ACTUALLY INSULATES THE COMPANY FROM REAL CRITICISM, INS INSULATES THE COMPANY FROM CHANGE AND WILL OFTEN CONCENTRATE POWER IN TOO FEW HANDS. WHAT DO INVESTORS MAKE OF THIS IT'S A UNIQUE SITUATION BECAUSE IT'S A FOUNDATION. THERE ARE THINGS TO KNOW. IT'S AN INHERENTLY RISK KRI STRUCTURE, A LOT OF PEOPLE WILL SAY. EVEN THOUGH THEY HAVE DONE INCREDIBLY WELL, IT'S SOMETHING INVESTORS SHOULD BE AWARE OF. IT'S ALSO SOMETHING WHERE INVESTORS SHOULD KNOW ABOUT THE FOUNDATION ITSELF. THE FOUNDATION'S PRIMARY OBJECTIVES, NOTABLY ARE NOT GROWTH. THEY ARE STABILITY AND SUPPORTING SCIENTIFIC AND HUMANITARIAN CAUSES. SO THAT'S A THING TO KEEP IN MIND. EXPERTS SAY, ULTIMATELY, THOUGH, THAT NO ONE SHOULD DISCOUNT NOVO NORDISK BECAUSE OF THIS STRUCTURE. THEY SHOULD JUST BEWARE, COMMON EYES WIDE OPEN BECAUSE THEY'RE BENEFITTING FROM A SIMPLE REALITY HERE AND IT'S THAT IT'S HARD TO ARGUE WITH SUCCESS. >> GREAT REPORTING AS USUAL. >>> NOVO NORDISK BECAME ROPE MOST VALUABLE COMPANY THIS YEAR, THANKS TO THE SEEMINGLY OVERNIGHT POPULARITY OF ITS DRUGS, O SZEMPIC AND WEGOVY. WE NAMED THEM THE COMPANY OF THE YEAR FOR 2023. ANJALEE KHEMLANI WAS ABLE SIT DOWN WITH THE CEO, LARS MAJOR AG D -- JORGENSON. >> IT'S A GOOD POINT THAT A COMPANY SHOULD STAY REALLY ON A SUSTAINABLE GROWTH TRACK YOU HAVE TO HAVE CONTINUOUS INNOVATION, AND IN OUR INDUSTRY WHEN PRODUCTS HAVE BEEN ON THE MARET FOR SOME TIME, AND YOU FACE PATENT EXPIRATION OR HEALTH CARE REFORMS TYPICALLY THERE WILL BE PRESSURE ON PRICING. SO WE SEE NOW THAT OUR LONG TIME SHORT ACTING FAMILY OF PRODUCTS IN THE U.S. IS NOW BEING INCLUDED IN THIS SAY NEW APPROACH TO NEGOTIATE MISSING BY THE GOVERNMENT, AND WE'LL HAVE ALL THE POWER POTENTIALLY IN THE FUTURE BEING INCLUDED IN THAT. WHAT WE FOCUS ON IS CONTINUING TO DRIVE INNOVATION. AS LONG AS YOU CONTINUE TO BE A NOVICE IN OUR COMMUNITY, YOU'LL HAVE VARIATIONS OF YOUR PRIOR PRODUCTS, AND WAYS TO GET TO MORE PATIENTS AND PROTECT VALUE. YOU BRING A BETTER OFFERING. SO ALWAYS BRINGING COMPLICATIONS WHEN YOU HAVE TO FACE GOVERNMENT INTERVENTIONS AND NEGOTIATIONS IT JUST UNDERLINES THE IMPORTANCE OF HAVING A STRONG STRATEGY THAT'S FOCUSED ON BRINGING BETTER AND BETTER PRODUCTS FOR PATIENTS, AND IF YOU SUCCEED, YOU HAVE THE GROWTH TRAJECTORY OF WHAT WE HAVE SEEN TODAY, AND A COMPANY THAT CAN STILL BE IN ITS STRONGEST PRECISION BECAUSE OF OUR DECADES CONTINUED INNOVATION HAS LED TO STRONGER AND STRONGER MEDICINE. YES, IT'S A CHALLENGE TO DEAL WITH BUT IT'S ALSO A CALL FOR JUST HAVING A CONTINUED FOCUS ON HOW WE AS A COMPANYDD VALUE, AND THAT'S VIA OUR SICIENCE AND THE INNOVATION WE BRING TO PATIE PATIENTS. >> YOU'RE AT THIS JUNCTURE, THE SWEETPOT,HE MAGIC NUMBER EVERYONE IS HAPPY WITH IN TERMS OF WEIGHT LOSS. YOU TALK ABOUT THIS IS WHERE WE ARE IN SOCIETY, HOW WE LIVE, WHAT WE DO, AND HOW IT'S DIFFERENT FROM, YOU KNOW, WHEN YOU WERE YOUNGER. WE'VE SEEN A LOT OF SORT OF THE DOOMSDAY PREDICTIONS FOR OTHER SECTORS AS A RESULT OF THE SUCCESS OF THESE DRUGS. WHAT DO YOU THINK ABOUT THAT? THERE'S EVERYTHING FROM FOOD AND BEVERAGE TO AIRLINES, CLOTHING, APPAREL, POTENTIAL GAMBLING AND ADDICTION BENEFITS. HOW DO YOU THINK THAT THAT'S GOING TO PAN OUT? DO YOU THINK IT'S REALLY GOING TO HAVE THAT MUCH OF AN IMPACT? >> IT'S A GREAT QUESTION, AND IT'S REALLY FASCINATE TO GO REFLECT ON HOW BIG OF AN IMPACT WE MIGHT HAVE. WHEN IT COMES TO CONSUMPTION OF FUEL FOR AIRLINE SOME OF THE MED TECH COMPANIES INVOLVED IN SLEEP APNEA, DIALYSIS, ET CETERA, I THINK THERE WILL BE AN IMPACT THAT IS COMING OVER MANY BI DRAMATIC WHAT IS BEING BE A DET DE DEPICTED RIGHT NOW. WHEN YOU ASSESS THE VALUE OF A COMPANY AND DISCOUNT FUTURE CASH FLOWS TO TODAY'S VALUE, IT'S ACROSS THE IMPACT OVER MANY TOY'S PRICE, AND YOU SEE SUDDEN REACTIONS MY VIEW IS THAT SOME OF THOSE REACTIONS ARE A BIT EXAGGERATED BUT THERE'S NO DOUBT THAT WITH THE INTERVENTION WE SEE NOW WITH THE MEDICINES, YOU SEE SIGNIFICANT SHIFT IN CONSUMER BEHAVIOR, AND SOME OF THESE CATEGORIES WILL BE IMPACTED. I THINK IT'S ALL QUITE SOME TIME, SO MY BASE VIEW IS THAT IT'S PERHAPS A BIT OF AN OVERREACTION. I TAKET'S STRONG SIGN OF WHAT DOES IT ACTUALLY SAY, THE POWER OF THE MEDICINE WE'RE INTRODUCING NOW IS HAVING ON SOCIETY, A STRONG CASE OF PAYING FOR THAT INNOVATION. >> DO YOU THINK WITH THE RESULT FROM THE SELECT TRIAL, YOU KNOW FOR THE CARDIOVASCULAR BENEFIT, DOES THIS NOW OPEN THE DOOR FOR MORE M&A, AND DIFFERENT DISEASE AREAS FOR THE COMPANY? YOU HAVE HAD SUCH A YEAR. WHAT ARE YOU THINKING ABOUT? >> YEAH, IT'S A GOOD POINT. WE CAN SEE THAT WHEN WE TAKE OUR MOLECULE INTO NEW SETTINGS, YOU'RE ALSO TOUCHING UPON KIDNEY DISEASE AND OTHER ADJACENT DISEASE AREAS. THAT MEANS THAT WE ARE EXPANDING OUR GROWTH PLATFORM, AND WE HAVE A DISCIPLIED WAY OF EXPANDING. WE FOLW A MOLECULE TO A NEW MARKET, AND THEN WE CAN START BUILDING THERE. WE ARE RIGHT NOW LOOKING FOR AND ACQUIRING NEW LICENSING IN THE PUBLIC SPACE. TO IT'S THE DEVELOPMENT OF MAGLIDE AND OBESITY AND THE BROADER APPLICATION OF THAT CREATING A PLATFORM FOR US AND NONORGANIC DEALS AND ACQUIRE INNOVATION FROM OUTSIDE AND REALLY COMPLEMENT AND BOLSTER OF OUR PRECISION IN NEW, THERAPEUTIC AREAS. I THINK THAT'S A VERY TERESTING GROWTH STRATEGY, AND IT'S ALSO NEEDED TO REPLENISH OUR PIPELINE GOING FORWARD. WE'RE STARTING EARLY, AND I'M QUITE OPTIMISTIC IN TERMS OF HOW WE CAN BUILD VALUE BY TAKING EARLY ASSETS IN AND THEN ADD VALUE TO THOSE ASSETS AND THEREBY VALUE TO OUR SHAREHOLDERS COMPARED TO IF YOU BUY MARKETED PRODUCTS OR LATE STAGE ASSETS, YOU TYPICALLY HAVE TO PAY FULLY UP AND THERE'S LIMITED RETURN TO OUR SHAREHOLDERS. WE WOULD LIKE TO DO IT EARLY, ADD VALUE TO IT, TAKE THRISK AND COME FROM THAT. >> A BIG THANKS TO OUR VERY OWN ANJALEE KHEMLANI FOR THAT INTERVIEWED WITH LARS JORGENSEN, NOVO NORDISK CEO. AHD, STAY TUNED, YOU'RE ION WATCHING YAHOO! FINANCE. >>> UNITED NATIONS RESOLUTION ON FRIDAY THAT CALLED FOR AN IMMEDIATE HUMANITARIAN CEASE FIRE IN GAZA. THE RESOLUTION WAS BACKED BY ALMOST ALL THE OTHER SECURITY COUNCIL MEMBERS, AND DOZENS OF OTHER NATIONS AND NOW THE N.'S RELIEF AND WORKS AGENCY FOR PALESTINE REFUGEES. THEY SAY IT FEELS BOOABANDONED THE INTERNATIONAL COMMUNITY. A MAJORITY OF AMERICANS DO NOT APPROVE OF PRESIDENT BIDEN'S HANDLING OF THE ISRAEL-HAMAS CONFLICT WITH THAT RATING FALLING TO 39% FROM 44% IN OCTOBER. SO WHAT DOES THIS MEAN FOR THE PRESIDENT GOING FORWARD? YAHOO! FINANCE'S RICK NEWMAN JOINS US NOW. RICK, ANY FALLOUT HERE? BIDEN CANNOT WAIT ON THIS ISSUE. THERE'S ONE POLL THAT SHOWS A MAJORITY OF AMERICANS SUPPORT ISRAEL IN THIS WAR. BIDEN HAS BEEN A VISIBLE AND A VOCAL ISRAEL SUPPORTER, AND YET THERE'S THAT POLL YOU JUST POINTED TO, JARED, WHERE ONLY 39% OF AMERICANS SAY THEY APPROVE OF BIDEN'S HANDLING OF THE WAR. IF YOU'RE BIN, YOU'RE WONDERING WHAT AM I SUPPOSED TO BE HERE. THIS IS DIVISIVE IN THE UNITED STATES AND ELSEWHERE. ONE OF THE THINGS THAT'S KIND OF ENLIGHTENING IS THAT YOUNG PEOPLE IN THE UNITED STATES SEEM MORE AWARE THAN A LOT OF PEOPLE MAY HAVE EXPECTED OF THE PLIGHT OF PALESTINIANS BASICALLY HOMELESS IN THE MIDDLE EAST AND IN ISRAEL AND ISRAELI POLICIES OF SETTLERS ENCROACHING ON PALESTINIAN LAND AND STUFF LIKE THAT. I MEAN, THIS SEEMS LIKE AN ARCANE MATTER IN A DISTANT LAND. AND A LOT OF AMERICAN YOUNG PEOP WHAT'S GOING ON HERE. I GUESS, IF THERE'S ANY GOOD NEWS FOR BIDEN IN ALL OF THIS IS THAT THIS IS FOREIGN POLICY. THIS IS NOT WHAT USUALLY MOTIVATES VOTERS DURING AN ELECTION. SO MAYBE THIS IS NOT GOING TO COST BEN A LOT OF VOTES. PEOPLE DON'T LIKE THE WAY THIS IS GOING. >> SURE, RICK, YES. YOU MAKE THE POINT ABOUT IT BEING FOREIGN POLICY. YOU'RE DEALING WITH THE ISSUE OF ANTI-SEMITISM COMING INTO PLAY. TACKLING IT HAS BEEN MORE PRE PRE PRESSING IN THE AFTERMATH. IT'S EMBROILED PRESTIGIOUS UNIVERSITIES, WE WANT TO INCLUDE THE IVIES, THE UNIVERSITY OF PENNSYLVANIA'S PRESIDENT, LIZ MAGILL RESIGNED ON SATURDAY, AMID PRESSURE FROM DONORS. THERE WERE A LOT OF ISSUES THERE. IS THERE, RICK. WHATHETORY >> THIS FOLLOWS THIS HEARING ON CAPITOL HILL LAST ATTITUDE, I BELIEVE. AND THE PROBLEM THAT THESE UNIVERSITY PRESIDENTS, NOT JUST THE IVY LEAGUE, IT'S EVERYWHERE IS HOW TO DEAL WITH ANTI-SEMITISM, HOW MUCH TO TOLERATE, BASICALLY, AND THE SORT OF CRINGY MOMENT IN THE HEARING THAT ONE OF THE MEMBERS OF CONGRESS ASKED THE PRESIDENT OF PENN, ALL OF THEM, REALLY, IF YOU HAVE STUDENTS WHO ARE CALLING FOR THE GENOCIDE OF ISRAEL, IS THAT TOLERABLE? SHOD THEY BE PUNISHED FOR THAT? AND LIZ MAGILL SAID IT IS CONTEXT DEPENDENT, AND THAT JUST WAS SUCH A WISHY WASHY ANSWER. I MEAN, IT'S KIND OF LIKE IT ALMOST SOUNDS LIKE YOU SHOULD BE ALLOWED TO SAY ANYTHING, AND THERE SHOULDE NOPAYBACK FOR ANYTHING THAT HAPPENS. THERE WAS ALREADY A LOT OF UNHAPPINESS ABOUT HOW SHE WAS HANDLING THIS, A LOT OF PROMINENT DONORS, INCLUDING MIKE ROWEN, THE CEO OF APOLLO, HOO'S PENT COMPANY, THEY WERE THREATENING TO WITHDRAW HUNDREDS OF MILLIONS OF DOLLARS FROM PENN. IT PILED UP AND SEEMED LIKE SHE HAD TO GO OVER THE WEEKEND. ALL OF THE DONATIONS ARE SAFE FOR NOW, BUT WHOEVER REPLACES HER WILL BE DEALING WITH THE SAME PROBLEMS. WE'L SEEF THE PRE HARVARD MEETS A SIMILAR FATE, THE PRESIDENT OF MIT ALSO IN THE HEARING ON THE HOT SEAT. IT'S GOING TO GO ON FOR A LONG TIME. >> A DELICATE SITUATION MOVING INTO THE NEW YEAR FOR SURE. THANK YOU FOR THAT, RICK NEWMAN. >> BYE, GUYS. >>> ALIBABA IS NO LONGER CHINA'S MOST VALUABLE eCOMMERCE COMPANY. IT ACTUALLY OWNED THAT TITLE FOR NEARLY A DECADE. THAT TITLE GOES TO PDD THE PARENT COMPANY TO TIMU. THE COMPANY HAS BEEN AROUND LESS THAN A DECADE BUT MAKING BIG WAVES IN THE eCOMMERCE SPACE, SURPASSING ALIBABA AND OTHER CHINESE COUNTER PARTS. U.S. SPENDING ON TEMU HAS SURPASSED SHEIN. I'LL GO EITHER WAY, AND TEMU IS ATTRACTING MORE CUSTOMERS, INCREASING ITS LEAD OVER SHEIN. I'LL GET IT BY THE END OF THE SEGMENT. >> GO AHEAD, SORRY. >> I WANT TO GO TO THE WI-FI INTERACTIVE. I WANT TO SHOW, THIS IS OUR CHINESE HEAT MAP, AND THIS SHOWS PIN DUODUO, TRUMPING ALIBABA BY 6, $7 BILLION, AND NOTHING IS CLOSE. >> PINDUODUO, HAS SEEN ITS STOCK SURGE THIS YEAR. IT'S COME AFTER SHEIN'S MARKET, AND JUST CONTINUED TO OUT STRIP IT MONTH AFTER MONTH AFTER MONTH. IT FIRST BEAT OUT SHEIN BACK IN MAY, AND, YOU KNOW, IT'S NOT ST WEN W SHOP ON THE PLATFORM, AND I CURRENTLY DON'T USE EITHER PLATFORM, BUT I HAVE FOLLOWED BOTH OF THESE COMPANIES, THESE eCOMMERCE COMPANIES THAT HAVE TAKEN ON THE LIKES OF AMAZON AND OUT STRIPPED THEM. >> HAVE YOU USED TEMU AT ALL? I . >> ONE OF THE THING THAT TEMU IS DOING IS THEY USED A SOCIAL ASPECT TO HOW USERS USE THEIR PLATFORM, SO THAT SOME OF THE PULL AND LURE IN TERMS OF THIS. WE HAVE SEEN THE STOCK SURGE WHEN YOU LOOK AT THE ADR IN PARTICULAR FOR TEMU. IT'S UP, WHAT, MORE THAN 60% YEAR TO DATE. >> YOU BET. >> SO IT'S GAINED A LOT OF MARKET SHARE. BUT SHEIN IS REPORTEDLY PLANNING TO COME TO THE PUBLIC MART IN THE U.S. WE'LL SEE WHAT HAPPENS WITH SHEIN. >> BIG IPOs OF THE NEW YEAR. ALL YOUR MARKETS ACTION STRAIGHT AHEAD, STAY TUNED, YOU'RE WATCHING YAHOO! FINANCE. >>> IN THE DECADES SINCE ITS PUBLIC DEBUT, HILTON HAS EXPANDED ITS FOOTPRINT ACROSS THE HOSPITALITY INDUSTRY, ADDING NEARLY HALF A MILLION ROOMS. WITH THE STOCK UP 300% FROM THE IPO WHAT'S NEXT FOR THE BRAND. WITH MORE, I'M JOINED BY CFO KEVIN JACOBS. GREAT TO CATCH SOME TIME WITH YOU. WHEN YOU TAKE US BACK THROUGH THE YEARS AND WHAT'S BEEN CORE AND CATALYST TO SOME OF THE GROWTH OVER TIME, WHAT IS THAT NEXT LEG OF GROWTH THAT YOU'RE GOING TO LEAN INTO? >> YEAH, HEY, BRAD, THANKS FOR IT'S GREAT TO BE WITH YOU. WE'RE CELEBRATING TEN YEARS SINCE OUR IPO. IT'S AMAZING. SEEMS LIKE YOU DON'T KNOW WHERE THE TIME HAS GONE, BUT YOU MENTIONED WE HAVE DOUBLED OUR BRAND PORTFOLIO IN THAT TIME. NEARLY DOUBLED THE SIZE OF THE COMPANY. WE CONTINUE TO GROW RAPIDLY. E NT PHASE OF GROWTH IS WE'RE OPENING MORE THAN A HOTEL A DAY. A DEVELOPMENT PIPELINE OF NEARLY 460,000 ROOMS. MORE ROOMS UNDER CONSTRUCTION THAN ANY OTHER HOTEL COMPANY, AND YOU KNOW, A LOT OF IT'S BEEN FUELED, OUR SUCCESS HAS BEEN WE ACQUIRED BY BLACK STONE AND TAKEN PROOIIVATE IN 2007. WE WERE JUST RECENTLY NAMED THE NUMBER ONE GREAT PLACE TO WORK IN THE WORLD BY A GREAT PLACE TO WORK IN FORTUNE. WE'RE REALLY PROUD OF THAT. YOU MENTIONED WE'RE PROUD OF OUR RETURNS. SINCE OUR IPO, TOTAL SHAREHOLDER RETURN HAS BEEN ABOUT 330%, WHICH HAS FAR OUT PACED THE DOW JONES, S&P 500, AND OUR PEER SET. >> WHEN YOU TALK ABOUT THAT ROOM BASE THAT'S UNDER CONSTRUCTION RIGHT NOW,NDHE CAPACITY THAT'S SET TO COME ONLINE OF ABOUT 460,000 ROOMS, HALF OF THAT CURRENTLY UNDER CONSTRUCTION AS OF THE LAST EARNINGS CALL, AND YOU DISCUSSED THAT ON THAT CALL. WHEN YOU THINK ABOUT THE COSTS THAT YOU WERE ANTICIPATING GOING INTO STARTING A LOT OF THESE PROJECTS, THAT'S KIND OF MED GIVEN THE CREDIT CONDITIONS AND A LOT OF WHAT IS GOING FORWARD HERE. ULTIMATELY, WHERE DO YOU SEE SOME OF THOSE COSTS ALSO COMPARED OVER A LONG-TERM BASIS? >> YEAH, LOOK, CONSTRUCTION COSTS, RAW MATERIALS COSTS HAVE MODERATED A LITTLE BIT. THEY WERE GOING UP IN 2021 AND 2022 20 TO 30% A YEAR. THOSE COST INCREASES HAVE MODERATED. AS YOU ALLUDED TO, THE COST OF CAPITAL IS HIGHER. WHAT THAT'S ACTUALLY CAUNG IS A LITTLE BIT OF A CONSTRAINED ENVIRONMENT FOR DEVELOPMENT, WHICH HELPS FUNDAMENTALS, IF CAPACITY ARE LOWER THAN FUNDAMENTALS, AND OUR BRANDS BEING AS STRONG AS THEY ARE, WE ARE CONTINUE TO GO TAKE SHARES. WE'RE GETTING UNDER CONSTRUCTION MORE THAN OUR FAIR SHARE OF PROJECTS AND THAT'S BECAUSE OUR BRANDS ARE FINANCEABLE, AND OUR OWNERS THINK THEY ARE MORE LIKELY TO HAVE SUCCESS WITH BRANDS. YEAR TO DATE THROUGH THE THIRD QUARTER, OUR CONSTRUCTION STARTS ARE UP OVER 20% GLOBALLY, 18% THIS THE U.S. HOTEL OWNERS ARE SAYING, LO, I KNOW MY CONSTRUCTION LOAN IS GOING TO COST ME MORE, BUT FUNDAMENTALS ARE GOOD. I LIKE THE HILTON BRANDS, I WOULD RATHER OPEN UP INTO AN ENVIRONMENT IN THE FUTURE, FUELING OUR COSTRUCTION STARTS, EXCUSE ME, TO CONTINUE TO GO UP DESPITE AN ENVIRONMENT THAT IS A LITTLE BIT MORE EXPENSIVE. >> KEVIN, LET'S TALK A LITTLE BIT MORE ABOUT THAT ENVIRONMENT JUST BRIEFLY HERE. I MEAN, REVENGE TRAVEL, DO YOU BELIEVE THAT'S BEHIND US? AND IF SO, IS 2024 A YEAR OF NORMALIZATION? >> I THINK IN SOME WAYS, THINGS HAVE NORMALIED. I THINK IT DEPDS ON HOW YOU CHARACTERIZE IT. THERE'S STILL A LOT OF PENT UP DEMAND FOR TRAVEL FROM COVID. OBVIOUSLY DURING COVID, PEOPLE FO FOCUSED ON ACQUIRING GOODS. THEY COULDN'T MOVE AROUND AS MUCH, AND NOW PEOPLE ARE FOCUSING ON EXPERIENCES. THRECORY H BEEN LED BY LEISURE, WHICH CONTINUES TO BE ROBUST. WE EXPECT A REALLY STRONG HOLIDAY SEASON COMING UP AND WE EXPECT LEISURE TRAVEL TO CONTINUE INTO NEXT YEAR. I DON'T KNOW IF YOU WOULD CHARACTERIZE IT AS REVENGE TRAVEL, BUT BUSINESS TRAVEL, WHICH EVERYBODY WROTE OFF DURING THE NDEM, AND SAID IT WAS NEVER GOING TO COME BACK IS NOW BACK TO WHERE IT WAS FROM A VOLUME PERSPECTIVE, AND ABOVE WHERE IT WAS IN 2019 FROM A REVENUE PERSPECTIVE. AND THEN MEETINGS AND EVENTS ARE COMING ON STRONG. OUR GROUP BUSINESS, OUR GROUP POSITION IS UP ALMOST 20%. SOF YOU THINK ABOUT PEOPLE BEING, YOU KNOW A LITTLE BIT MORE FLEXIBLE IN THEIR WORK ENVIRONMENT, MAYBE NOT IN THE OFFICE AS MUCH. PEOPLE NEED TO MEET MORE, SO I DON'T KNOW THAT I WOULD CALL IT REVENGE, BUT I THINK I WOULD STILL REFER TO IT AS A LOT OF PENALTY UP DEMAND FOR TRAVEL THROUGH COVID. SO, YOU KNOW, OUR OUTLOOK FOR THE ENVIRONMENT FOR NEXT YEAR, EVEN THOUGH MOST PEOPLE ARE CALLING FOR THE ECONOMY TO SLOW A LITTLE BIT, WE FEEL REALLY GOOD ABOUT THE COMMAND AND THE OVERALL FUNDAMENTALS SET UP FOR OUR BUSINESS NEXT YEAR. >> I GOT TO HUSTLE TO MY FINISH HERE, BUT LASTLY, WHEN YOU'VE GOT THE AMOUNT OF HILTON HONORS MEMBERS AT Y DO, YOU WERE TALKING RECENTLY ABOUT GROWTH OF 19% YEAR OVER YEAR, HITTING 173 MILLION MEMBERS, FASTEST GROWING HOTEL LOYALTY PROGRAM HERE, THAT'S A LOT OF PEOPLE LOOKING FOR PREMIUM EXPERIENCES AND PRODUCTS. DO YOU ANTICIPATE NEEDING TO CHANGE THECALE CHAE TT TYPE OF KIND OF MEMBERSHIP MAKEUP OR THE REWARDS THAT PEOPLE SEE AS A RESULT OF THAT DEMAND? >> NO, LOOK, WE'RE CONSTANTLY EVOLVING. THE, YOU KNOW, VALUE PROPOSITION OF OUR LOYALTY PROGRAM HAS BEEN A HUGE DRIVER OF GROWTH. YOU MENTIONED 173 MILLION MEMBERS. THAT'S QUADRUPLE WHAT IT WAS TEN YEARS AGO, WHEN WE IPOs. WE FEEL GOOD ABOUT THE VALUE PROPOSITION. WE'RE CONSTANTLY TWEAKING IT AND USING, YOU KNOW, THE COMBINATIO DIGITAL TECHNOLOGY TO HAVE A BETTER RELATIONSHIP WITH THOSE MEMBERS, AND THOSE MEMBERSRIVE R GROWTH AND THEY'LL CONTINUE TO. >> KEVIN JACOBS, HILTON CFO, CONGRATULATIONS ON THE MILESTONE FOR THE COMPANY. >> THANKS, BRAD, THANKS FOR HAVING ME. >> ABSOLUTELY. AND THAT'S ALL FOR US HERE ON YAHOO! FINANCE. FOR JARED BLIKRE, DIANE KING HALL, AND BRAD SMITH.
