Core Viewpoint - Incorporating top stocks from various sectors can effectively balance an investment portfolio, with the Global Industry Classification Standard aiding in sector comparison and market tracking [1][2]. Sector Summaries 1. Technology - The technology sector comprises over a third of the S&P 500, with a 34% weighting, including major companies like Nvidia, Microsoft, and Apple. Texas Instruments is highlighted as a top tech stock for 2025 due to its diversified business and 2.7% dividend yield [5][6]. 2. Financials - Financials represent the second-largest sector at 13.8% of the S&P 500. American Express is noted for its dual role as a payment processor and card issuer, maintaining a low net write-off rate, indicating strong risk management [7]. 3. Consumer Discretionary - This sector accounts for 10.4% of the S&P 500 and is sensitive to economic conditions. Starbucks is identified as a top pick due to its successful turnaround and 2.7% dividend yield, supported by leadership changes [8][9]. 4. Communications - The communications sector makes up 9.9% of the S&P 500. Alphabet is recommended for its diverse business model and low valuation, with continued growth in Google Search and accelerating adoption of its chatbot, Google Gemini [10]. 5. Healthcare - Healthcare constitutes 8.8% of the S&P 500, facing pressure from sell-offs. Eli Lilly is recognized for its promising drug pipeline and growing dividend, appealing to investors [11]. 6. Industrials - The industrials sector has an 8.6% weighting in the S&P 500. Honeywell International is noted for its plan to split into three businesses to enhance shareholder value, with a 2.1% dividend yield [12]. 7. Consumer Staples - Consumer staples represent 5.2% of the S&P 500 and are currently challenged by inflation. Procter & Gamble is highlighted for its strong pricing power and 2.7% dividend yield, having increased payouts for 69 consecutive years [13]. 8. Energy - The energy sector is under pressure from low oil prices and the energy transition. ExxonMobil is recommended for its low production costs and diversified portfolio, boasting a 3.7% dividend yield and 42 years of increasing payouts [15][16]. 9. Utilities - Utilities make up 2.5% of the S&P 500 and are known for reliable passive income. Southern Company is noted for its high demand and 3.1% yield, making it a strong investment choice [17]. 10. Real Estate - The real estate sector accounts for 2% of the S&P 500, including REITs. Mid-America Apartment Communities is highlighted for its strong dividend history, with a yield of 4.3% [19]. 11. Materials - The materials sector comprises 1.8% of the S&P 500. Sherwin-Williams is recognized for its long history of dividend increases and stock repurchases, yielding 0.9% [20][22].

Core Insights - American Express Company (AXP) is enhancing its global sports and entertainment portfolio through new partnerships, including collaborations with Hard Rock Stadium, the Formula 1 Crypto.com Miami Grand Prix, and the Miami Dolphins as their official payments partner [1][9]. Partnerships and Benefits - Eligible AmEx cardholders will receive exclusive benefits such as Amex Presale Tickets, access to VIP lounges, and a special entrance, aiming to create a unique space where sports, culture, and premium experiences converge [2][9]. - The sponsorship of the Formula 1 Crypto.com Miami Grand Prix supports AXP's expansion plans into over 20 global races by 2025, focusing on immersive fan experiences and card member benefits like AmEx Race Radios [3][9]. Market Position and Performance - AXP's sports portfolio is robust, featuring significant sponsorships in various sports, with Miami being a strategic location due to Hard Rock Stadium's role as the home of the Dolphins and a venue for major events [4][9]. - In 2023, AXP's network volume was approximately $1.7 billion, reflecting a 5% year-over-year increase in 2024, followed by a 6% rise in the first half of 2025, indicating resilience in travel and entertainment spending [5]. Competitive Landscape - Competitors like Mastercard and Visa are also active in the entertainment sector, with Mastercard's purchase transactions increasing by 9.6% year-over-year in the first half of 2025, while Visa's payments volume rose by 8% year-over-year in Q3 of fiscal 2025 [6][7]. Financial Metrics - AXP shares have increased by 3.9% year-to-date, outperforming the industry growth of 1.8% [8]. - The company trades at a forward price-to-earnings ratio of 18.56X, lower than the industry average of 20.17, and has a Value Score of B [10]. - The Zacks Consensus Estimate for AXP's 2025 earnings is $15.26 per share, representing a 14.3% increase from the previous year [11].

[Music] And we are back on halftime with our final trades. Brenn Talkington, you're up first. >> Let's let's roll a sales force.Like the technicals here. The market gets it wrong all the time. AI is going to make this company stickier and stickier.>> Carrie, >> I like that trade. Brent, I'm giving you American Express. AXP.It seems to be hitting an inflection point on the stock. It's well below the market multiple. >> This is the shock.Boston based company right there. >> Boston based company. >> Yeah.Right ...

Core Insights - American Express Company (AXP) has outperformed the S&P 500 and broader industry with a 24.3% gain over the past year, although it lagged behind larger peers Visa Inc. (27.7%) and Mastercard Incorporated (25.1%) [1][5] - The company's strong brand and affluent customer base have provided resilience against macroeconomic volatility, maintaining its reputation as a quality investment [2][21] - AXP currently trades below the Wall Street average price target of $321.38, indicating a limited upside of 4.7% from current levels [3][5] Financial Performance - AXP's forward P/E ratio stands at 18.43X, which is below the industry average of 20.56X but above its five-year median of 17.03X, suggesting it may be slightly overvalued historically [8][9] - The company reported a second-quarter interest income of $6.3 billion, reflecting an 8% year-over-year increase, supported by its unique business model as both a card issuer and a bank [12] - Network volumes rose 7% to $472 billion in the second quarter, driven by resilient consumer spending among its affluent customer base [13] Balance Sheet Strength - AXP holds $57.9 billion in cash and cash equivalents with only $1.5 billion in short-term borrowing, indicating a strong balance sheet [14] - The total assets increased to $295.6 billion from $271.5 billion at the end of 2024, with a net debt-to-capital ratio of 1.91%, significantly lower than the industry average of 16.11% [14] Growth Estimates - Analysts project a 14.3% year-over-year increase in AXP's earnings for 2025, with 2026 earnings expected to grow by 13.7% [16] - Revenue estimates for 2025 and 2026 indicate growth of 8.3% and 8.1%, respectively, with a solid track record of surpassing earnings expectations [16][17] Risks and Challenges - AXP is more exposed to travel and entertainment spending, which can decline sharply during economic downturns, making it vulnerable despite its affluent customer base [18][22] - Rising operating costs have been a concern, with expenses increasing significantly over the past few years, which could pressure margins [19] - The company's domestic focus compared to Visa and Mastercard's global expansion may limit its adaptability to emerging payment trends [20][22]

Core Insights - American Express Company (AXP) is adapting to the Buy Now Pay Later (BNPL) trend by integrating it into its existing card services rather than resisting it [1][4] - The company's 'Plan It' feature allows cardholders to split purchases of $100 or more into manageable monthly payments, enhancing the cardholder experience with rewards and benefits [2][8] - American Express is collaborating with various companies to strengthen its presence in the digital shopping landscape, showcasing that traditional financial institutions can innovate and grow within the BNPL space [3][4] Financial Performance - American Express achieved a 98% spend retention rate, with network volume increasing by 7% year over year in Q2 2025, indicating strong customer loyalty and growth [4][8] - The forward price-to-earnings ratio for American Express is 18.4X, which is lower than the industry average of 20.6, suggesting a potentially attractive valuation [10] - The Zacks Consensus Estimate for American Express' 2025 earnings is projected at $15.26 per share, reflecting a 14.3% increase from the previous year [11] Competitive Landscape - Competitors in the BNPL space include PayPal Holdings, which reported a 6% year-over-year growth in total payment volume and a 2% increase in active accounts to 438 million in Q2 2025 [5] - Affirm Holdings is focusing on higher-ticket purchases and reported a 23% year-over-year increase in active consumers, along with a 36% growth in gross merchandise volume in Q3 2025 [6]

Group 1 - Berkshire Hathaway's Q2 2025 13F filing reveals significant investment adjustments, indicating a strategic response to the U.S. economic structure and market risks [1] - The previously secretive position of nearly $5 billion is identified as a stake in Nucor (NUE), with 6.61 million shares valued at approximately $857 million, reflecting a bullish outlook on the steel industry due to infrastructure investments and manufacturing recovery [2] - New positions in real estate and healthcare stocks, including UnitedHealth (UNH) and Lennar (LEN), suggest a focus on long-term housing demand and stability in essential sectors [3] Group 2 - Increased holdings in energy and consumer sectors, such as Chevron (CVX) and Pool Corp (POOL), highlight a dual strategy of cash flow stability and consumer demand [4][5] - Core positions in companies like Coca-Cola (KO) and American Express (AXP) remain unchanged, indicating a commitment to brands with strong cash flow [6] - The exit from T-Mobile (TMUS) and reductions in positions in Bank of America (BAC) and Apple (AAPL) signal a cautious approach towards high-valuation sectors amid macroeconomic uncertainties [7] Group 3 - The overall investment strategy reflects a rotation away from financial and tech sectors towards industrial, healthcare, and real estate, emphasizing defensive and cash flow-oriented investments [8] - The focus on industrial stocks like NUE suggests a bet on manufacturing recovery and infrastructure cycles, while healthcare investments enhance defensive positioning [8]

Core Viewpoint - Berkshire Hathaway, led by Warren Buffett, is currently underperforming the S&P 500, with its year-to-date performance lagging behind major stock market indexes [1][5]. Group 1: Top Holdings and Performance - As of August 15, the top 10 holdings of Berkshire Hathaway include significant investments in Apple, American Express, Bank of America, Coca-Cola, Chevron, Moody's, Occidental Petroleum, Kraft Heinz, Mitsubishi, and Chubb [2][6]. - The year-to-date performance of the top holdings shows that Apple is down 5.3%, while Coca-Cola and Mitsubishi are outperforming the S&P 500 with gains of 12.3% and 22.3%, respectively [5][8]. - Berkshire Hathaway sold 7% of its Apple position and 4% of its Bank of America position in the second quarter, while increasing its stake in Chevron by 3% [3][4]. Group 2: Comparison with Market Indexes - Year-to-date, Berkshire Hathaway Class A shares are up 6.2%, which is lower than the SPDR S&P 500 ETF Trust (+10.1%), Invesco QQQ Trust (+13.2%), and SPDR Dow Jones Industrial Average ETF (+6.0%) [5][7]. - Among the top 10 holdings, only Coca-Cola and Mitsubishi are outperforming the S&P 500, while five of the top 10 are outperforming the Dow Jones Industrial Average [8].

Core Insights - Berkshire Hathaway, led by Warren Buffett, has resumed selling its largest holding, Apple, and has further reduced its stake in Bank of America while making significant investments in UnitedHealth and revealing new positions in Nucor and two real estate stocks [1][8][12]. Investment Actions - In Q2, Berkshire purchased approximately 5.04 million shares of UnitedHealth, with a market value of about $1.57 billion, making it the 18th largest holding [2][15]. - The "mystery" holding Nucor Steel was revealed, with Berkshire acquiring 6.61 million shares valued at over $857 million, ranking as the 25th largest holding [3][5]. - Berkshire also bought around 7.05 million shares of Lennar, valued at approximately $780 million, and over 1.48 million shares of D.R. Horton, valued at about $191 million [6][7]. Reductions in Holdings - Berkshire reduced its Apple holdings by 20 million shares, a decrease of 6.67%, bringing its total to approximately 280 million shares, with a market value reduction of $4.1 billion [8][10]. - The stake in Bank of America was cut by about 26.31 million shares, a 4.71% decrease, with a market value reduction of $1.24 billion [11][12]. - Berkshire completely exited its position in T-Mobile, selling 3.88 million shares [13]. Portfolio Composition - By the end of Q2, Apple's holding represented 22.31% of Berkshire's portfolio, while Bank of America accounted for 11.12% [10][11]. - Chevron was the only stock among the top ten holdings to see an increase, with Berkshire adding 3.45 million shares, although its percentage of the portfolio decreased from 7.69% to 6.79% due to a decline in stock price [19]. Market Reactions - Following the disclosure of Berkshire's investment in UnitedHealth, the stock price surged over 9% in after-hours trading [16].

Trading Recommendations - Sell November 45 calls for Freeport McMoran (FCX) [1] - Consider American Express, noting the stock is down approximately 10% over the past month [2] - Buy volatility as a just-in-case trade [2] Market Observations - Gen Z and millennials show affinity for American Express [2] - Expect a pickup in M&A activity to benefit private equity and traditional big banks [2]

Core Insights - American Express Co (AXP) faces challenges in maintaining engagement with loyal cardholders while attracting tech-savvy customers in a digital-first fintech landscape [1] Group 1: Company Performance - AXP has shown resilience, with network volume reaching approximately $1.7 billion, reflecting a 5% year-over-year increase in 2024 and a further 6% increase in the first half of 2025 [2][8] - The company is enhancing customer engagement through digital transformation initiatives, including AI-powered fraud detection and faster onboarding processes [3][8] Group 2: Competitive Landscape - Competitors like Mastercard and Visa are also adapting; Mastercard's purchase transactions rose 9.6% year-over-year in the first half of 2025, while Visa's payments volume increased by 8% year-over-year in Q3 of fiscal 2025 [5][6] - AXP differentiates itself by offering premium perks and fostering strong customer relationships, which may help it maintain loyalty amidst evolving fintech competition [4] Group 3: Valuation and Estimates - AXP's shares have decreased by 0.2% year-to-date, contrasting with the industry's growth of 2.6% [7] - The forward price-to-earnings ratio for AXP is 17.88X, lower than the industry average of 20.65, with a Value Score of B [9] - The Zacks Consensus Estimate for AXP's 2025 earnings is projected at $15.25 per share, indicating a 14.2% increase from the previous year [10]