Kristen: And this week we're going to be looking at iBit, that's the iShares Bitcoin Trust. Now as we were just discussing, Bitcoin's relationship with gold has been changing, changing, so we're taking a closer look at one of the biggest vehicles investors are using to get exposure to cryptocurrency and rather to Bitcoin, and that is iBit. Now iBit holds Bitcoin directly, giving investors exposure to movements in the price of Bitcoin through a traditional broker account without having to buy or custody the cryptocurrency themselves. But here's what we are going to be watching right now. It is the flows. Now Spot Bitcoin ETFs saw hundreds of millions of dollars leave earlier this week before demand came roaring back Thursday and Friday. Bitcoin ETFs took in more than $433 million on Friday alone, nearly half of which went to IBIT and in fact in the past month IBIT has raked in just shy of $3 billion. So as Bitcoin breaks back above $85,000 we'll be watching whether those ETF inflows are going to continue. Sustained demand through products like IBIT could help tell us whether this rally is attracting fresh investor capital or whether the latest move in Bitcoin is running ahead of the flows. I want to turn now to our second guest. We're joined now by Carlos Diez. He's the Founder & CEO of MarketGrader, a stock and ETF research firm. Carlos, good morning. Thank you so much for joining us today.
Carlos Diez: Thank you for having me, Kristen.
Kristen: So I want to talk with you about energy right now. It's been dominating a lot of the headlines. Markets are contending with, you know, geopolitics, reduced Russian supply. Your methodology is looking at company fundamentals. So what are your screens telling you right now about the opportunity in energy?
Carlos Diez: We're seeing a lot of good fundamentals in energy. Uh, we have an index called the Baron 400 index. It's an ETF that tracks it, uh, Baron 400 ETF symbol BFOR. It just rebalanced this week and we had the highest allocation to energy stocks we've had in over two years. Uh, we selected 34 names in energy, a lot of refiners. Uh, a lot of natural gas companies, uh, the fundamentals for the sector look very strong, uh, and I think it's a story that goes beyond just the price of oil that obviously has spiked because of, uh, geopolitics. So overall, the, the, the sector looks very strong in our view.
Kristen: OK, so let's talk a little bit more about that, those fundamentals because as you're mentioning the Baron's 400 index, as you said, rebalanced. Now energy saw the largest net increase of any sector. You guys added 11 companies now to bring that total, as you were mentioning, to 34. What actually changed in the fundamentals to push so many more energy companies into that index?
Carlos Diaz: I think it's part of a story that is a broader, longer term story around energy policy. I think energy policy has shifted in the last few years, uh, to an energy security theme, uh, away from an energy transition story, which is where we were the last decade. Uh, I think, uh, both private companies and governments, importantly, are very focused on energy security, energy resilience, uh, and, and so some of these assets, especially natural gas, are becoming, uh, strategic assets, you know, refiners in the US, believe it or not, in our view, uh, look like strategic assets. Uh, the US hasn't built a refiner in a very long time. Uh, California basically phased out its refineries altogether. There's, I think, one left. Uh, a lot of the ones on the East Coast have been shut down as well. And lo and behold, we still have a lot of demand for refined, uh, products. So, so those companies are sitting in a, in a, in a very good position fundamentally, and that's coming through in earnings. It's coming through in earnings, revenue growth, net income growth, margins are very strong. So, so yes, there's some of the story that is connected to geopolitics and what's happening today in Iran, Ukraine, but I think it's beyond that. I think like I said before, uh, I would call it, we're an era of natural or of energy security, and I think that's a, a front and center focus for policymakers around the world.
Kristen: So which energy companies are ranking well right now in your system? What are the fundamental characteristics that are separating them from the rest of the sector?
Carlos Diez: Yeah, so, uh, let me give you a few names. Maybe I can give you some, uh, off the beaten path names that I think are attractive, uh, that Mark. Mark has a knack for finding companies in, you know, across the, the cap spectrum, different industries, you know, we do own in the baron 400s some of the larger names. We have Chevron, we have Oxy, we have ConocoPhillips, uh, in refiners, we have some of the largest refiners we have Marathon Petroleum, we have Valero, uh, but then we have some very interesting names in, in some of the spaces we like. There's a company called Venture Global, uh, ticker symbol BG. It's a $34 billion market cap company. They're building the largest, uh, uh, LNG, uh, facility in the United States, uh, and their numbers are, are showing that the demand for liquefied natural gas is showing in their earnings, in their sales. They more than doubled sales in the last year, more than tripled net income in the last quarter, and incredibly, the stock still trades at only 9 times forward earnings, 2 times sales, and that's actually a theme we're seeing within the energy space. Overall and in the barrel for 100, uh, these companies in the aggregate, the 34 energy companies straight at, uh, 10 times forward earnings, um, so very inexpensive when, when you compare it to other parts of the market, uh. And then there's two names. There's another name in the, in the natural gas space that we really like. There's a company called USA Comression Partners, uh, very small company, 3.8 billion market cap. Interestingly, this company does not, uh, it's not a natural gas producer, but it's a, a, it, it, it produces a compression systems for natural gas without compression. Natural gas doesn't flow around the United States. It doesn't flow into data centers. It doesn't flow into the facilities that are converting natural gas into electricity. So it's a critical player, uh, in this whole electrification, uh, data center buildout AI story that, that people keep talking about. So it's one of those kind of pick and shovel stocks that we really like, um, uh, yeah, it's, it's those kind of names that, that Mark Creator is really good at identifying and a lot of them are in the barrel per 100.
Kristen: I really hope folks had their notepads out to write down some of those names that you just mentioned. So I only have about 45 seconds left with you, Carlos. So I want to step back from energy a little bit. What does the rebalance tell you about the overall health of corporate America right now, because you're screening companies across sectors for growth at a reasonable price. You're looking at the fundamental strength. Are you seeing those qualities broadly across the market, or are you seeing them becoming more concentrated in a few areas?
Carlos Diaz: We are seeing a, a, a broad participation across sectors and industries. Um, the, the, the three biggest sectors in the Baron 400 are financials, industrials, and technology, uh, with still, like I said, broad participation for energy, materials, so. So there's a broadening of the earnings story across the US. Uh, is a lot of that tied to the AI story? Yes, uh, but the AI story goes beyond semiconductors, beyond the hyperscalers. A lot of companies are benefiting from just a lot of growth. In the US and there's a lot of productivity growth that has come with uh the AI story and that is also favoring uh industries and companies across the board. So overall, uh, the health of the economy, at least from the corporate earnings perspective, looks, looks really good to us.
Kristen: Carlos Diez, Founder & CEO of MarketGrader, thank you so much for joining us. We're gonna have to have you back soon.
Carlos Diaz: Thank you.
