March 13, 2024 • 20 mins
Netflix isn't just a streaming service; it's an empire. But how does it fare when thrown into the arena with Disney, Hulu, Amazon Prime, and the others?
Clem and Steve tear apart the streaming service battlefield to reveal Netflix's tactics for maintaining its lead, boasting a mighty 260 million subscribers worldwide. We're not just talking numbers; we take you behind the scenes of Netflix's international content and marketing strategy—could this be the secret weapon that gives the platform its edge?
Financially, Netflix has a strong net income margin and impressive free cash flow. And it has impressive growth. We hold back on the tough questions: Is Netflix's valuation a reflection of its worth, or is it an overpriced ticket to the investing show?
Straight Talk for All - Nonsense for None
Please check out our other podcasts:
https://skepticsguidetoinvesting.buzzsprout.com
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Steve Davenport (00:02):
Welcome to Skeptics Guide to Investing.
In previous episodes, Clem andI have discussed Nvidia, Apple,
Microsoft and Tesla.
In this broadcast, we're goingto discuss streaming service
Netflix.
Back when we had FANG as anacronym, Netflix was the end.
Now Netflix isn't in themagnificent seven.
(00:24):
Clem, I know you hold Netflixin your portfolio and I suspect
many of our listeners subscribeto multiple streaming services,
for example, Disney, Prime orpossibly YouTube Premium.
Do you think Netflix'sstreaming position is superior
to these platforms?
Clem Miller (00:44):
Let me start off by saying that I recently read
that the average household inthe United States subscribes to
2.9 streaming services.
Obviously, it's not a questionof picking one over others, so
(01:06):
you're not going to have asituation in general where
somebody picks Netflix overperhaps one of these others.
But it's interesting to look atthe stats.
So Netflix has 260 millionsubscribers worldwide, which is
(01:32):
a bit more than the combinationof Disney, hulu and ESPN Prime.
They have 225 million, whereasthe combination of Amazon Prime,
mgm Plus, has 205 million.
So they're all sort of, eventhough Netflix is ahead of the
(01:53):
other two.
They're all sort of thedominant oligopoly.
But it doesn't stop there.
Youtube Premium has 100 million, max Plus and Discovery have 98
million.
Paramount Global has 68 million.
So, the way I look at it, youhave these different streaming
(02:14):
services that offer somewhatdifferent packages and sort of
niches.
You know if they're maybesports or Star Wars or Star Trek
or things of that nature,whether they have old TV series
(02:34):
that they're streaming.
So you just have or newprogramming, new content.
Steve Davenport (02:41):
And.
I've noticed that on Netflix.
I tend to get these movies andI don't know the actors and I
look and then it ends up beingin subtitles or voiceover yeah,
really kind of annoying, becauseyou can tell that they aren't
saying the words , there's alittle delay, or I just would
have thought that by now, wherewe could create AI images, we'd
(03:05):
be able to over dub a littlebetter.
Clem Miller (03:09):
Well, that's an interesting point, which brings
me to another.
I think a positive aboutNetflix, even though you know,
even despite what you're saying,I think Netflix has done a much
better job than the others ofbecoming a global streaming
service.
So they generate content allover the world and, on top of
(03:32):
that, they sell content all overthe world.
I talked to some friends wholive overseas and they watch
Netflix just like we watchNetflix here in the United
States.
So it's a global service and,with 260 million, I think
there's a long runway ahead forNetflix being able to generate
(03:52):
new subscriber growth.
Steve Davenport (03:55):
Yeah, I've enjoyed watching some Irish
shows Derry Girls, Bad Sisterand some other ones and I kind
of enjoy the highlights and theway they do the cinematography
is slightly different than inthe US, so I kind of like them,
switching it up every now andthen and watching another series
(04:20):
from another country.
Do you think that Netflix tapsinto that global market better
than everyone else?
Clem Miller (04:29):
Yeah, I think it certainly does.
As I was mentioning, I do havefriends overseas who watch
Netflix and I know a lot of thecontent on Netflix a good chunk
of it anyway is made overseasand I think Netflix has a good
(04:54):
cultural sensitivity that maybesome of the other networks who
focus on US niches might haveless of.
Steve Davenport (05:08):
So I guess you'd argue that, despite the
competition, netflix has a widemoat.
How does the moat translate intoprofitability and cash flow.
Clem Miller (05:20):
Yeah.
So the net income margin, whichis the net income or net profit
divided by revenues, is apretty strong 16%.
The return on equity associatedwith that is 26%, which is
really high, really strong and areally amazing cash flow
(05:44):
generation.
Free cash flow margin is 57%.
That is, for every dollar ofrevenue they generate, they
produce 57 cents of cash flowthat can be rolled back into the
business or used to pay down toredeem shares.
(06:05):
It's really a strong cash flowgenerating business.
Steve Davenport (06:12):
So companies with strong cash flows and
revenues are usually expensive.
I see that Netflix 2024 PE is35.
It's not outrageous compared tosome of the names, but it's
still high.
How do you classify it as beingexpensive, reasonable or cheap.
Clem Miller (06:33):
So first of all, before we get into those value
numbers, let me just say ongrowth, it generates 11% revenue
growth annualized over the lastthree years.
That's really strong and 26%earnings growth earnings per
share growth so that's prettystrong.
Which leads me to my pointabout valuation.
(06:55):
Now it may well be that in 2024, the PE ratio is 35, 36 times.
Because of that growth rate,that PE ratio comes down over
time.
So in 2025, it's 29 times 2026,it's 24 times 2027, it's 21
(07:18):
times.
So that makes going out intothe future.
That makes PE certainly notunattractive.
I'd say that Netflix is a bitexpensive, but it's not terribly
expensive compared to some ofthe magnificent seven companies,
(07:40):
some of the semiconductorstocks, so it's not unattractive
on a price.
I'll also say that the PEGratio, which only looks at the
next year of growth, divides thePE for next year divided by the
next year of growth is 1.2times.
So that's actually prettyattractive.
Steve Davenport (08:02):
So do you think they're going to be able to
sustain this, though, and getinto those numbers?
I mean, when we talk about 2027, that seems like a long time
away in terms of being able topredict when companies can't hit
numbers one quarter awaysometimes.
Clem Miller (08:19):
Yeah, I mean it's.
You know there's always a lotof variation in this, but this
is based on, you know, analystexpectations over a period, long
period of time.
Analysts can be wrong,sometimes they are wrong, but
you know, I'm giving you whatthe what the expectations are,
and that's you know.
(08:40):
That's better than justguessing, right?
Steve Davenport (08:43):
Yeah, it's good to have something, so you use
Glassdoor employee satisfactionratings as a proxy for company
quality.
How does Netflix fare on that?
Do people like it there?
Clem Miller (08:58):
Yeah, I mean.
Glassdoor has a 4.2 out of 5rating.
Anything above 4 indicates verysatisfied employees.
So yeah, I mean Glassdoor.
Glassdoor rating indicates thatemployees are very satisfied.
That's a high qualityindication.
Steve Davenport (09:18):
So one thing I was thinking about when we
talked about doing this podcastwas is our lifestyle really
changed when we went throughCOVID?
So my wife and I and this isjust between you and me, clem,
but we started to watch.
Clem Miller (09:35):
Love is Blind, you and me and everybody listening
to this podcast.
Steve Davenport (09:38):
Okay, so my son was home and he said why don't
we watch Love is Blind, thelatest season, and we thought
this is really not something wewanna watch, but if we get to
spend time with our son we makean exception.
And now we've gone back andwatched the prior four seasons
(09:58):
and we're opening up the fifthseason and we're feeling like
there's something verycomforting about going on a
binge streaming and it remindsme of the times during COVID
when you just felt like you hadto stay put and you just kind of
relaxed and, you know, allowedyourself some time to just get
(10:20):
away.
Do you think that we're gonnasee people ever change this kind
of binging on streams of shows,or are they noticing any
activity where people aregetting back to normal?
Or do you think we're at thenew normal for people streaming
(10:43):
and demand for streaming?
Because it seems to me that ifeverybody started to exercise
more and do more things, thearea that would hurt would be
the streaming time.
Clem Miller (10:56):
Well, obviously I can speak from my own experience
more so than about experiencesin general.
My COVID experience was, yeah,I mean, we watched a lot more
streaming on TV, but I also,during that period of time, got
a lot of exercise that, becauseyou couldn't go inside, you had
(11:19):
to.
You know, if you wanted toexercise can't go to the gym,
you'd have to walk aroundoutside.
So I don't think that there'snecessarily a, it's not
necessarily exercise versusstreaming.
You can do both.
I think that you know theexperience of the whole
(11:44):
Barbenheimer, barbie andOppenheimer going to the
theaters and so on.
This summer, you know a lot ofpeople were saying, well, the
theaters are back.
Honestly, I don't think they'reback.
I think that was, I think,those two movies coming out the
same weekend.
That was an exception.
That proves the rule that thetheater industry is going out.
(12:10):
You may disagree, maybe othersdisagree, but I think the future
well, the present andcontinuing into the future is
more streaming and less going totheaters.
I'll also say that I think thatyou know the biggest potential
(12:34):
threat out there to thestreaming services doesn't
really come from other streamingservices or from theaters.
It comes from YouTube, becausea lot of people watch YouTube
and there's a lot of contentthere, including some really
high quality content that peopleare watching what Our contents
(12:59):
there?
Yeah, our contents there.
No, it's pretty high quality.
Yeah, I'd say so.
But you know, there's a lot ofhigh quality stuff on YouTube
and I spend personally, I spenda lot more time watching YouTube
than I do on streaming services.
That's not necessarily true forother people, but for me it's.
(13:20):
You know, I find, you know, avery high quality degree of
content on YouTube.
Steve Davenport (13:30):
Well, yeah, I think the TikTok also, when I
don't know how or if you have anopinion about TikTok being
banned, but it feels to me likethere are other substitutes for
streaming and they better watchout, because I think that a lot
of these services, like YouTube,are only going to get bigger
(13:53):
and they seem to.
Their growth is just tremendousin terms of what they're
producing.
How do you feel about TikTok?
Clem Miller (14:01):
Well, so there's two issues with TikTok.
One is that, unless they moveto a longer format, I think that
its prospects are fairlylimited.
A lot of people may disagreewith that, but if you have very
short videos, yeah, they can beinteresting, yeah, they can be
(14:24):
addictive, but on the other hand, how far can that go?
Would be my question.
Second thing is obviously thegeopolitical aspect of it and
concerns about whether TikTok,like Huawei and other things
that emanate from China, whetherthere's a Trojan horse yeah,
(14:49):
it's a Trojan horse, or that maybe a good way to describe it or
whether there is datacollection that we don't know
about or whatnot.
I don't really know if thatactually can be resolved by
changing ownership of TikTok.
As long as somehow the Chinesecompanies or the Chinese
(15:14):
government is in that mix, Idon't know how you can
potentially resolve that.
I really don't see US-Chinarelations improving.
It's really the only thing thatthe Biden administration and
the Trump people actually agreeon.
I just don't see that changing.
Steve Davenport (15:37):
Yeah, so one of the last items of your analysis
is usually about short-sellerinterest.
How does Netflix have anacceptable short-interest ratio?
Clem Miller (15:49):
Yeah, it's 1.84%, which is it's not as low as some
of the other Magnificent Sevenor some other companies, but
it's certainly very comfortable.
It's not anything to beconcerned about.
Steve Davenport (16:08):
So let's look at the mailbag.
So the question is whether wehold Amazon and Disney in
addition to Netflix.
Clem Miller (16:17):
Clem do you, I Do not hold Disney Because it
doesn't meet my quantitativecriteria.
I do hold Amazon, but it's not,you know it's not because of
Amazon Prime and the streamingand whatnot.
It's because of the overallcompany, including you know it's
(16:38):
AWS Cloud services, includingit's.
You know it's delivery capacity, you know it's a.
It's a strong company.
So I, I hold it.
So you know, if you look at themagnificent seven Companies, I
(17:00):
hold Amazon, I hold meta, I holdMicrosoft and I hold Nvidia,
but I do not hold Tesla and Idon't hold what's the other one?
I'm missing Steve.
I'm being like an Americanpolitician forgetting.
(17:25):
No, I do hold Google.
Okay, I do hold alphabet, I do.
Steve Davenport (17:39):
I've uh, you know we don't hold Tesla, we
don't hold meta anymore.
We did it one time and so allthe others we do hold.
So I agree, it's it.
It's hard not to be a part ofthem, but because we're equal
weighted, we don't hold nearlywhat the market holds in a case
(18:02):
like Nvidia.
So we're we're far underweightand you know when you look at
some of these names and whatthey've done.
I mean, nvidia is now almost30% of the semiconductor index.
Yeah, it's crazy, which I thinkis.
You know, when you get to thatpoint, you're basically
(18:23):
dominating a Lot of differentspaces.
Clem Miller (18:27):
So, yeah, nvidia, I've had to keep trimming back.
Metta I've had to trim back aswell because it was doing it was
really on a hot roll for awhile, I think on an alphabet
Google they've had.
I think there's an opportunitythere for actually buying some
more, because they kind ofstumbled with with some of their
(18:50):
AI product.
I don't know if you noticedthat recently.
Steve Davenport (18:53):
Yep, they're named that.
We added a couple of places, soEverybody thanks for listening
to our podcast.
If you like our podcast, pleasegive us a like and subscribe to
be notified about futureepisodes.
And Thanks for listening.
Clem, do you have anything else?
Nope, that's it.
It was a really greatOpportunity to talk to you and
(19:14):
to everybody.
Welcome to Skeptics Guide to Investing.
In previous episodes, Clem andI have discussed Nvidia, Apple,
Microsoft and Tesla.
In this broadcast, we're goingto discuss streaming service
Netflix.
Back when we had FANG as anacronym, Netflix was the end.
Now Netflix isn't in themagnificent seven.
(00:24):
Clem, I know you hold Netflixin your portfolio and I suspect
many of our listeners subscribeto multiple streaming services,
for example, Disney, Prime orpossibly YouTube Premium.
Do you think Netflix'sstreaming position is superior
to these platforms?
Clem Miller (00:44):
Let me start off by saying that I recently read
that the average household inthe United States subscribes to
2.9 streaming services.
Obviously, it's not a questionof picking one over others, so
(01:06):
you're not going to have asituation in general where
somebody picks Netflix overperhaps one of these others.
But it's interesting to look atthe stats.
So Netflix has 260 millionsubscribers worldwide, which is
(01:32):
a bit more than the combinationof Disney, hulu and ESPN Prime.
They have 225 million, whereasthe combination of Amazon Prime,
mgm Plus, has 205 million.
So they're all sort of, eventhough Netflix is ahead of the
(01:53):
other two.
They're all sort of thedominant oligopoly.
But it doesn't stop there.
Youtube Premium has 100 million, max Plus and Discovery have 98
million.
Paramount Global has 68 million.
So, the way I look at it, youhave these different streaming
(02:14):
services that offer somewhatdifferent packages and sort of
niches.
You know if they're maybesports or Star Wars or Star Trek
or things of that nature,whether they have old TV series
(02:34):
that they're streaming.
So you just have or newprogramming, new content.
Steve Davenport (02:41):
And.
I've noticed that on Netflix.
I tend to get these movies andI don't know the actors and I
look and then it ends up beingin subtitles or voiceover yeah,
really kind of annoying, becauseyou can tell that they aren't
saying the words , there's alittle delay, or I just would
have thought that by now, wherewe could create AI images, we'd
(03:05):
be able to over dub a littlebetter.
Clem Miller (03:09):
Well, that's an interesting point, which brings
me to another.
I think a positive aboutNetflix, even though you know,
even despite what you're saying,I think Netflix has done a much
better job than the others ofbecoming a global streaming
service.
So they generate content allover the world and, on top of
(03:32):
that, they sell content all overthe world.
I talked to some friends wholive overseas and they watch
Netflix just like we watchNetflix here in the United
States.
So it's a global service and,with 260 million, I think
there's a long runway ahead forNetflix being able to generate
(03:52):
new subscriber growth.
Steve Davenport (03:55):
Yeah, I've enjoyed watching some Irish
shows Derry Girls, Bad Sisterand some other ones and I kind
of enjoy the highlights and theway they do the cinematography
is slightly different than inthe US, so I kind of like them,
switching it up every now andthen and watching another series
(04:20):
from another country.
Do you think that Netflix tapsinto that global market better
than everyone else?
Clem Miller (04:29):
Yeah, I think it certainly does.
As I was mentioning, I do havefriends overseas who watch
Netflix and I know a lot of thecontent on Netflix a good chunk
of it anyway is made overseasand I think Netflix has a good
(04:54):
cultural sensitivity that maybesome of the other networks who
focus on US niches might haveless of.
Steve Davenport (05:08):
So I guess you'd argue that, despite the
competition, netflix has a widemoat.
How does the moat translate intoprofitability and cash flow.
Clem Miller (05:20):
Yeah.
So the net income margin, whichis the net income or net profit
divided by revenues, is apretty strong 16%.
The return on equity associatedwith that is 26%, which is
really high, really strong and areally amazing cash flow
(05:44):
generation.
Free cash flow margin is 57%.
That is, for every dollar ofrevenue they generate, they
produce 57 cents of cash flowthat can be rolled back into the
business or used to pay down toredeem shares.
(06:05):
It's really a strong cash flowgenerating business.
Steve Davenport (06:12):
So companies with strong cash flows and
revenues are usually expensive.
I see that Netflix 2024 PE is35.
It's not outrageous compared tosome of the names, but it's
still high.
How do you classify it as beingexpensive, reasonable or cheap.
Clem Miller (06:33):
So first of all, before we get into those value
numbers, let me just say ongrowth, it generates 11% revenue
growth annualized over the lastthree years.
That's really strong and 26%earnings growth earnings per
share growth so that's prettystrong.
Which leads me to my pointabout valuation.
(06:55):
Now it may well be that in 2024, the PE ratio is 35, 36 times.
Because of that growth rate,that PE ratio comes down over
time.
So in 2025, it's 29 times 2026,it's 24 times 2027, it's 21
(07:18):
times.
So that makes going out intothe future.
That makes PE certainly notunattractive.
I'd say that Netflix is a bitexpensive, but it's not terribly
expensive compared to some ofthe magnificent seven companies,
(07:40):
some of the semiconductorstocks, so it's not unattractive
on a price.
I'll also say that the PEGratio, which only looks at the
next year of growth, divides thePE for next year divided by the
next year of growth is 1.2times.
So that's actually prettyattractive.
Steve Davenport (08:02):
So do you think they're going to be able to
sustain this, though, and getinto those numbers?
I mean, when we talk about 2027, that seems like a long time
away in terms of being able topredict when companies can't hit
numbers one quarter awaysometimes.
Clem Miller (08:19):
Yeah, I mean it's.
You know there's always a lotof variation in this, but this
is based on, you know, analystexpectations over a period, long
period of time.
Analysts can be wrong,sometimes they are wrong, but
you know, I'm giving you whatthe what the expectations are,
and that's you know.
(08:40):
That's better than justguessing, right?
Steve Davenport (08:43):
Yeah, it's good to have something, so you use
Glassdoor employee satisfactionratings as a proxy for company
quality.
How does Netflix fare on that?
Do people like it there?
Clem Miller (08:58):
Yeah, I mean.
Glassdoor has a 4.2 out of 5rating.
Anything above 4 indicates verysatisfied employees.
So yeah, I mean Glassdoor.
Glassdoor rating indicates thatemployees are very satisfied.
That's a high qualityindication.
Steve Davenport (09:18):
So one thing I was thinking about when we
talked about doing this podcastwas is our lifestyle really
changed when we went throughCOVID?
So my wife and I and this isjust between you and me, clem,
but we started to watch.
Clem Miller (09:35):
Love is Blind, you and me and everybody listening
to this podcast.
Steve Davenport (09:38):
Okay, so my son was home and he said why don't
we watch Love is Blind, thelatest season, and we thought
this is really not something wewanna watch, but if we get to
spend time with our son we makean exception.
And now we've gone back andwatched the prior four seasons
(09:58):
and we're opening up the fifthseason and we're feeling like
there's something verycomforting about going on a
binge streaming and it remindsme of the times during COVID
when you just felt like you hadto stay put and you just kind of
relaxed and, you know, allowedyourself some time to just get
(10:20):
away.
Do you think that we're gonnasee people ever change this kind
of binging on streams of shows,or are they noticing any
activity where people aregetting back to normal?
Or do you think we're at thenew normal for people streaming
(10:43):
and demand for streaming?
Because it seems to me that ifeverybody started to exercise
more and do more things, thearea that would hurt would be
the streaming time.
Clem Miller (10:56):
Well, obviously I can speak from my own experience
more so than about experiencesin general.
My COVID experience was, yeah,I mean, we watched a lot more
streaming on TV, but I also,during that period of time, got
a lot of exercise that, becauseyou couldn't go inside, you had
(11:19):
to.
You know, if you wanted toexercise can't go to the gym,
you'd have to walk aroundoutside.
So I don't think that there'snecessarily a, it's not
necessarily exercise versusstreaming.
You can do both.
I think that you know theexperience of the whole
(11:44):
Barbenheimer, barbie andOppenheimer going to the
theaters and so on.
This summer, you know a lot ofpeople were saying, well, the
theaters are back.
Honestly, I don't think they'reback.
I think that was, I think,those two movies coming out the
same weekend.
That was an exception.
That proves the rule that thetheater industry is going out.
(12:10):
You may disagree, maybe othersdisagree, but I think the future
well, the present andcontinuing into the future is
more streaming and less going totheaters.
I'll also say that I think thatyou know the biggest potential
(12:34):
threat out there to thestreaming services doesn't
really come from other streamingservices or from theaters.
It comes from YouTube, becausea lot of people watch YouTube
and there's a lot of contentthere, including some really
high quality content that peopleare watching what Our contents
(12:59):
there?
Yeah, our contents there.
No, it's pretty high quality.
Yeah, I'd say so.
But you know, there's a lot ofhigh quality stuff on YouTube
and I spend personally, I spenda lot more time watching YouTube
than I do on streaming services.
That's not necessarily true forother people, but for me it's.
(13:20):
You know, I find, you know, avery high quality degree of
content on YouTube.
Steve Davenport (13:30):
Well, yeah, I think the TikTok also, when I
don't know how or if you have anopinion about TikTok being
banned, but it feels to me likethere are other substitutes for
streaming and they better watchout, because I think that a lot
of these services, like YouTube,are only going to get bigger
(13:53):
and they seem to.
Their growth is just tremendousin terms of what they're
producing.
How do you feel about TikTok?
Clem Miller (14:01):
Well, so there's two issues with TikTok.
One is that, unless they moveto a longer format, I think that
its prospects are fairlylimited.
A lot of people may disagreewith that, but if you have very
short videos, yeah, they can beinteresting, yeah, they can be
(14:24):
addictive, but on the other hand, how far can that go?
Would be my question.
Second thing is obviously thegeopolitical aspect of it and
concerns about whether TikTok,like Huawei and other things
that emanate from China, whetherthere's a Trojan horse yeah,
(14:49):
it's a Trojan horse, or that maybe a good way to describe it or
whether there is datacollection that we don't know
about or whatnot.
I don't really know if thatactually can be resolved by
changing ownership of TikTok.
As long as somehow the Chinesecompanies or the Chinese
(15:14):
government is in that mix, Idon't know how you can
potentially resolve that.
I really don't see US-Chinarelations improving.
It's really the only thing thatthe Biden administration and
the Trump people actually agreeon.
I just don't see that changing.
Steve Davenport (15:37):
Yeah, so one of the last items of your analysis
is usually about short-sellerinterest.
How does Netflix have anacceptable short-interest ratio?
Clem Miller (15:49):
Yeah, it's 1.84%, which is it's not as low as some
of the other Magnificent Sevenor some other companies, but
it's certainly very comfortable.
It's not anything to beconcerned about.
Steve Davenport (16:08):
So let's look at the mailbag.
So the question is whether wehold Amazon and Disney in
addition to Netflix.
Clem Miller (16:17):
Clem do you, I Do not hold Disney Because it
doesn't meet my quantitativecriteria.
I do hold Amazon, but it's not,you know it's not because of
Amazon Prime and the streamingand whatnot.
It's because of the overallcompany, including you know it's
(16:38):
AWS Cloud services, includingit's.
You know it's delivery capacity, you know it's a.
It's a strong company.
So I, I hold it.
So you know, if you look at themagnificent seven Companies, I
(17:00):
hold Amazon, I hold meta, I holdMicrosoft and I hold Nvidia,
but I do not hold Tesla and Idon't hold what's the other one?
I'm missing Steve.
I'm being like an Americanpolitician forgetting.
(17:25):
No, I do hold Google.
Okay, I do hold alphabet, I do.
Steve Davenport (17:39):
I've uh, you know we don't hold Tesla, we
don't hold meta anymore.
We did it one time and so allthe others we do hold.
So I agree, it's it.
It's hard not to be a part ofthem, but because we're equal
weighted, we don't hold nearlywhat the market holds in a case
(18:02):
like Nvidia.
So we're we're far underweightand you know when you look at
some of these names and whatthey've done.
I mean, nvidia is now almost30% of the semiconductor index.
Yeah, it's crazy, which I thinkis.
You know, when you get to thatpoint, you're basically
(18:23):
dominating a Lot of differentspaces.
Clem Miller (18:27):
So, yeah, nvidia, I've had to keep trimming back.
Metta I've had to trim back aswell because it was doing it was
really on a hot roll for awhile, I think on an alphabet
Google they've had.
I think there's an opportunitythere for actually buying some
more, because they kind ofstumbled with with some of their
(18:50):
AI product.
I don't know if you noticedthat recently.
Steve Davenport (18:53):
Yep, they're named that.
We added a couple of places, soEverybody thanks for listening
to our podcast.
If you like our podcast, pleasegive us a like and subscribe to
be notified about futureepisodes.
And Thanks for listening.
Clem, do you have anything else?
Nope, that's it.
It was a really greatOpportunity to talk to you and
(19:14):
to everybody.
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