Consider buying gold miner Newmont (NEM) on a pullback to the $85 level, which is viewed as a significant long-term entry point. Based on a compelling valuation gap, Citibank (C) is presented as an opportunity with a potential price target of $160. In healthcare, Bristol Myers Squibb (BMY) has broken its downtrend and offers a potential trade towards $63. For broad energy exposure, the Energy Select Sector SPDR Fund (XLE) is a high-conviction idea for potentially strong returns in 2026. To capitalize on a broadening market rally beyond big tech, consider the equal-weight Invesco S&P 500 ETF (RSP).

The AI Investment Theme

• The podcast hosts believe the big investment theme for 2026 may shift from the "picks and shovels" of AI (like chipmakers) to the companies that are successfully using AI to improve their business.
• This shift could lead to multiple expansion (investors being willing to pay a higher price for a stock relative to its earnings) for companies outside of the top 10 largest tech names.
• Walmart (WMT) and Facebook (META) were cited as early examples of companies whose valuations have benefited from leveraging AI effectively.

Takeaways

• Investors should look for companies in sectors like healthcare or financial services that are demonstrating a clear return on their investment in AI technology.
• The broadening of the AI theme could benefit equal-weight ETFs like the RSP over market-cap-weighted ones like the SPY.

Uber (UBER)

• The stock has seen a dramatic sell-off from over $100 per share to around $82.
• There's a debate between the hosts about the stock's future prospects.
  • The Bull Case: One host remains bullish, calling Uber "best in class" compared to competitors like Lyft and believes it is "destined to once again, get through $100." The average analyst price target on FactSet is $112.
  • The Bear Case: The other host is more cautious, pointing to significant headwinds.
    • Earnings are projected to decline 30% next year.
    • The company faces competitive threats from autonomous vehicle companies like Waymo.
    • Uber's own autonomous strategy is unclear and will be a major focus for investors in 2026. He calls the stock "not a slam dunk."

Takeaways

• Uber presents a mixed picture. While one host sees long-term potential and a path back to $100, significant risks remain.
• Investors should pay close attention to the company's next earnings report for guidance on future growth and any announcements regarding its autonomous vehicle strategy, which is seen as a key catalyst or risk.

Gold & Gold Miners

• The hosts are very bullish on gold, believing the fundamental reasons for owning it have not changed despite recent volatility.
• The primary risk factor mentioned that could cause a sharp sell-off would be a major central bank, like China, being forced to sell its large gold reserves.
• The underperformance of gold mining stocks has reversed, and they are now catching up to the price of gold.

Newmont Mining (NEM)

• The stock has had a massive run, from $38 a year ago to an all-time high above $100.
• A potential pullback to the $85 level, which was a previous all-time high, is viewed as a significant buying opportunity ("buy this with both hands").
• The average analyst price target on FactSet is $112.
• Agnico Eagle Mines (AEM) was also mentioned as a "best in class" operator that has historically been a better-run company than Newmont.

Takeaways

• For investors who are bullish on gold, the mining stocks offer a leveraged way to play the theme.
• A pullback in Newmont (NEM) to the $85 level could be an attractive entry point for a long-term position.
• Investors looking for the "best operator" in the space might consider Agnico Eagle Mines (AEM).

ETF Ideas for 2026

The hosts provided several ETF ideas they believe could outperform the S&P 500 (SPY) in 2026.

• XLE (Energy Select Sector SPDR Fund):
  • A bullish call on the energy sector. The host believes the ETF has a "real chance to be mid to high double digits returns" in 2026.
  • This is based on the strength of major holdings like Exxon (XOM) and the potential for ConocoPhillips (COP) and Chevron (CVX) to catch up.
• RSP (Invesco S&P 500 Equal Weight ETF):
  • This is a bet on the broadening of the market rally beyond the top 10 mega-cap stocks.
  • The thesis is that as more companies benefit from AI, the equal-weighted index will outperform the market-cap-weighted index (SPY), which is heavily concentrated in a few large names.
• EWZ (iShares MSCI Brazil ETF):
  • An international play based on a bullish view of materials.
  • Brazil is a materials-heavy economy, and this ETF's holdings include the mining giant Vale.
• KWEB (KraneShares CSI China Internet ETF):
  • A contrarian bet that Chinese tech innovation is underappreciated by the market.
  • The ETF holds major Chinese tech companies like Baidu (BIDU), Alibaba (BABA), and Tencent (TCEHY), which are seen as having attractive valuations compared to their US peers.

Takeaways

• For a US sector bet: Consider XLE for energy exposure or RSP for a bet on a broader market rally.
• For international exposure: Consider EWZ for a play on the global materials theme or KWEB for a potential rebound in undervalued Chinese tech stocks.

Banks

• There's a divergence of opinion on where the opportunity is in the banking sector.

Citibank (C)

• A host made a strong bullish case for Citibank based on a valuation gap.
• Citibank trades at approximately 1.15x tangible book value, while JPMorgan (JPM) trades at 3x tangible book value.
• The thesis is that while Citi doesn't deserve the same valuation as JPM, it could trade at half of it (around 1.5x-1.6x tangible book).
• This re-rating would imply a stock price of about $160 for Citibank.

KRE (SPDR S&P Regional Banking ETF)

• Another host prefers regional banks over the large money-center banks.
• The reasoning is that large banks like JPMorgan have significant exposure to private credit, which could be a source of risk.
• If the economy continues to grow, the undervalued regional banks are expected to outperform the larger banks on a relative basis.

Takeaways

• For a specific large-cap bank idea: Citibank (C) offers a compelling valuation-based argument with a potential price target of $160.
• For a broader banking theme: The KRE regional bank ETF is presented as a way to play continued economic growth while avoiding potential risks in the private credit market that larger banks are exposed to.

Healthcare & Biotechnology

• The hosts are bullish on the healthcare sector for 2026, particularly on the theme of Mergers & Acquisitions (M&A). They expect large pharmaceutical companies to acquire smaller biotech firms.

Large-Cap Pharma

• Bristol Myers Squibb (BMY): A host is bullish, stating the stock has broken a long-term downtrend. At a price of $54, they see a potential for it to run towards its prior highs around $63.
• Merck (MRK): Mentioned as a stock that is getting "revalued" by the market, implying positive sentiment.
• Novo Nordisk (NVO): The upcoming launch of their oral daily weight loss pill (Wagovi) is seen as a major event that could shake up the highly competitive GLP-1 drug market, currently dominated by injectable treatments from Novo and Eli Lilly (LLY).

Small-Cap Biotech (M&A Ideas)

• The hosts believe a "slew of M&A activity" is coming, which could lead to sharp stock price increases for target companies.
• Specific names mentioned as being liked by the hosts include:
  • Summit Therapeutics (SMMT)
  • Viking Therapeutics (VKTX)
  • Insmed (INSM) (noted to have pulled back from $212 to $175)
  • Structured Therapeutics (GPCR) was cited as an example of a stock that recently doubled in one day on positive news.

Takeaways

• Investors interested in large-cap pharma could look at Bristol Myers (BMY), which is seen as having a favorable technical setup.
• The M&A theme in biotech presents a higher-risk, higher-reward opportunity. A basket approach to names like SMMT, VKTX, and INSM could be a way to gain exposure to this trend.
• Keep an eye on news related to Novo Nordisk's oral weight loss pill, as it could impact the entire GLP-1 space, including competitor Eli Lilly.