BNN - Wednesday, May 22, 2024 - 11:00 a.m. (ET) - Segment #3

preliminary revenue for its 4th quarter that missed analyst estimates. She is also taking nearly 700 million dollars in charges. Shares of lululemon are weaker at this hour. The company announcing some changes on management front. Product officers leaving the company and that rule will not be replaced. Also plans to overhaul its fight to bran teams. Analysts say the changes could signal future top line growth issues and some margins. Ahead. Got some news from power corp. Has closed its china investment unit and dismissed that staffing. The report says say the closure is strategic decision and is mainly due to the economic slowdown and rising geopolitical risks. Tsx and s&p or weaker at the showers. The nasdaq is higher in the oil market. We're looking at to crews still lower on the day, but off its worst levels. Goldsman down today. After recently reaching record highs off about one and a half percent. The canadian dollar's been weaker against the greenback at 73 14. And a quick look at what's happening with the cryptocurrency price for bitcoin up about 7 tenths of percent right now. And then the big story we're going to watching after the bell is nvidia, the ai chip darling saint report its quarterly results. And undoubtedly the numbers will be big. But when there are big expectations, what does that mean? Let's get some perspective, dan now says founder and senior portfolio manager at now's investment management, longtime tech watcher. Dan, a nice to have you with us. I'm just curious to get your overall view what you're going to be watching with nvidia later today. Well, I think everybody on the planet knows it's a huge beat in raise. People are expecting numbers to go up substantially on the other side. And that is the only negative. >> Because the expectations are so high. But having said that last quarter, the stock will expect haitians arise. Well, stop one of 16% the next day and balancing out those high expectations is actually low valuation. The stock is trading at a forward pe, which is about 15% below its 5 year average. So my belief is a stock goes up slightly tomorrow. But if you look at over the course of the next 3 years or so, I think there's still a lot more growth left in it. Don't get me wrong. The stock's going to be incredibly volatile, but that's kind of my take on what to expect. >> Because there's just so much demand that still in the pipeline. >> Well, I think if you compare this build out of the ai infrastructure, too, something very comparable, which is the build-out of the internet infrastructure well, and in 1994, you had the first internet web browser coming out called netscape navigator. And if you look at the nvidia opponent at that time with cisco, cisco became the most valuable company in the world, but it took over 5 years for that to occur. And cisco's revenues went up 15 and a half times from the end of 94 to its ultimate peak. If you look at nvidia today, their earnings have gone substantially from about 6 billion when we heard about this new thing called generative ai and chatgpt 2, they're expected to report 25 billion. So that's a forex, but that's not a 15 and a half expects that cisco and this is only a 15 months into whereas the build-out for internet infrastructure took over 5 years. So that's how to put it in some perspective, that is helpful perspective. And I guess what else would you be watching for what indications could you get from management that might build into the case that over the long run, they're still a lot of roadway year for a company like nvidia. >> Well, some of news actually came out yesterday and it was encouraging to see how the star reacted and that there was a news story that came out that said. >> Amazon went ahead and move some of their orders from the current ships producing into these new chips that they're expected to launch over the course of the next quarter or so. And the stock actually, stop, which this has been the fear for investors is everybody knows that companies have been watering 2 to 3 times more than what they actually need because they just couldn't get the checks. And so the big fear is what you go through period of digestion as companies, you know, week for the newest ships to come out because supply has grown so much. So now you can actually get what you wore. So the reaction yesterday was encouraging, you know, obviously cisco it media talks about a pause fall. It will be interesting to see how

things react to that because this is amazon. We're talking about that this news came out on yesterday. So obviously huge customer and the stock took it pretty well. And maybe that's due to the low valuations. So that's the main be focused on is, you growth rates going forward and is their passport before the new chip comes I mean growths the key word here because I'm I'm looking at the revenue growth. Expectations were already coming off a couple of quarters where the revenue growth was more than 200%. That's expected to be the case this time around. But then you look at the bottom line performance. >> And adjusted earnings growth, which believe is expected to top 500% like this is this is not comparable to any of that. If dare say make gifts and 7, there's no other company in the so-called negatives and 7, this putting up that kind of performance right now. When you think about investing in the tech landscape more broadly speaking, you know, how much would you be leaning into a name like nvidia versus the rest of the tech sector? Just for some context. >> Well, I think you always want to know what the market share leaders in the market share leaders. You know, they always look expensive, but you're going to get some vicious corrections along the way. So going back to cisco for a second from the end of 94 to 2000 the staff winner 4,000%. But it didn't mean that you get a 26% correction during the latter part of 1995. It was down 30%. For a period in 1997 and was down 37% for a period in 1998. So is never astaire step I think there are other companies and we as well, we amazon, which is the biggest hyperscaler out there. So cut a company wants to try to once programs there. The guy that has the most share about one-third of that market microsoft is another one. If you're looking more broadly over a longer period of time and then is using ai really well in terms of monetizing their at ads as well recommending what videos you and I want to watch. So I think those are some other earnings beyond just in media that should benefit overtime. And then uses with regards specifically no matter what happens with economy, no matter where interest rates. So whether we get a recession or not, you're going to have presidential election in the united states, that a lot of money is going to be spent on, that's going to and then you've got the olympics are coming no matter what as well. And a lot money be spent on that. So those are some names that we think can do the latter part of this year. All well like stocks on wall street these days as well. Dan, thanks very much for your time to to see appreciate >> Thank you, dan. Now is founder and senior portfolio manager at niles investment management. When we come back, we've got the latest results from canadian pension giant cpp. And we'll talk to the ceo jon graham about the new areas they're looking at for investment over the long run. (Dynamic music)Persistent inflation has becomemore of an issue over the last little while. And if you believe it couldcontinue, here are a few things to keep in mindas you plan ahead. First, the obvious,your expenses. Higher inflation can meanhigher cost. Do you have enough to meet yourobligations, or is it time to reconsider someof your budgeting choices? Second, your investments. Different asset classes reactdifferently to inflation. Especially persistent inflation. So having the right asset mix inan inflationary environment is important. And third, your retirementplanning. In order to get the same futurespending power as you originally planned, you could need to savemore if inflation persists. No matter where you are,conditions can change. How you save, invest and retiremay need adjustments at times to ensure you can stillreach your goals. I'm Kim Parlee, and that's yourMoney Talk Minute. The Harvest Diversified Monthly Income etf. Consistent monthly income. The Harvest Diversified Monthly Income etf. Hdif on the tsx. The future is zero Carbon. Mayfair Gold is developing Canada's first carbon neutral gold project with offsets funding residential solar panel installation across the country. Mayfair Gold. Money is a thing. You're told to make money, invest money, save money. While others are encouraging you to spend your money. You might even be planning your money ...based on someone else's plan. Maybe it's time to do things...differently. And get obsessed over something other than money. Like building a path based on what's important to you. ( ) we understand money's a thing, but it's not everything.

Edward Jones. We do money differently. Closed captioning of this bnn Bloomberg Program is brought to you by Scotia iTRADE. Everything you need to direct invest. Scotia iTRADE. It's every investor's dream. Canadian pension giant cpp investments has reported its annual results, earning an 8% return the fiscal year that ended in march. Encouraging news for the more than 20 million canadian workers and retirees who depend on the fun for retirement income one day. We'll see. Bp now has more than 630 billion dollars in assets and saw solid performance from its stock market portfolio. It's private equit holdings also helped out jon grams of co cpp investments. And we spoke with him earlier about the performance. >> The portfolio it really performed as designed. We have built a portfolio that is diversified by asset class, diversified by geography, really designed to avoid concentration in any specific or and I think we saw that we saw some asset classes doing really well. Some jarred, he's doing really well. And overall delivering solid returns. As you highlighted a percent. And so when you're trying to focus on diversification, what goes into that because that's kind of a long-term planning process. But if people want to get a sense on how that's going to influence your investing, >> Plan for the long term. How do you go about diversifying? >> Yeah, it's a great question. And as we think about their portfolio in the portfolio, it's a 632 billion dollars and going to continue to grow. And of course, fully like that, you can't swing around in the market, you can't make tactical use down on the markets and you need to build a portfolio that really is a supertanker that will just move through rough waters move through a wide range of macroeconomic conditions. So from a diversification perspective, first by geography, I'm sure in that we have exposure to gra. He's all over the world and we certainly benefit in the last year from the U.S. markets and probably in bit of an age of us exceptionalism from return perspective. But we need to ensure that we continue to have a diverse portfolio across americas, europe and asia. And then from an asset class private equity is exposed to different components in the economy in real estate and infrastructure credit. So making sure we can have a balanced approach to all the different asset classes. >> And then you also have a lot of real estate exposure to pension funds, generally speaking, have been investors in real estate. It's a bit of a complicated time on that side as well. How are you thinking about going forward? >> Yeah, we we had a real estate in the portfolio almost since the beginning of of active management. And I think we've gottttle bit less than many around the world with real estate. It's a very asset class. The retail office logistics, data centres residential, they're all quite different in. They're all quite different geography. So amanda anderson acacia, I think it's also important for us to be in real estate. And I look at the results over the past few years. Logistics done well. Data centres are thanks to the ai boom are doing well. Residential, especially in the americas doing well, but then that's offset by challenges in the office space, specifically in the americas and some in europe and retails been challenged for a while. So portfolio today, it's incident, you know, percent of the cpp investment portfolio. And for us, that seems about right where we are and will continue to invest and continue real estate as part of the portfolio. >> Now for the average investor who's hearing about how you go about increasingly, they might have more access to some of those different areas you invest in b on the stock market. But a lot of people, their bread and butter is investing in the equity market. And since you are a long-term investor, how do you feel about the prospects for the stock market going forward? >> Well, I mean, I think we always have a significant component of the portfolio in the equity market. Equity markets, both public and private. I think one of the developments over the past few years as the accessibility of the private markets and a more and more accessibility into the private markets, which interesting development and what I'm sure we will continue and we certainly benefited over the past 10 years and probably even longer than that from pretty constructive backdrop for the equity markets with. And recently low rates, low inflation, kind of 9 geopolitics going we may not have some of those tailwinds in the equity markets with rates being higher, inflation being a bit sticky year and

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