Let me ask you Your outlook for 2022. so many people Have come on this program over the last Week and said we've had fantastic gains In 2021 it's not going to match this I have to agree I think there's a lot going on So 2021 was a strong year like abigail Talked about very strong as was 2019 and 2020. 2022 Could still be a strong year but with Different winners i think in 2021 we saw What i'm going to call them the clovid Winners covet winners in technology and Healthcare Even the financials did well not related To covid so i think in 2022 you could Still have some of the companies that Have underperformed significantly Picking up and there are a number of Those in in a number of sectors all Right so let's go there uh give us where You think the opportunities might be Maybe even some names Yeah i mean the primary um opportunity I'm going to say is healthcare Hard to believe if you look at the Number of healthcare names that did Extremely well your quest lab corp cvs Thermo fish or edwards life sciences It's hard to believe that the sector as A whole underperformed the market only Up 12 or 13 on the year going forward i
Think there are a number of names that Were ignored or missed your usph united Uh physical therapy exact sciences merck Medtronic biotech look at the biotech Index biogen Novocure teledoc teledoc had a horrible Year i would be focusing on those not All of them you have to do your Fundamental research but i think some of Those could be very attractive Why did some of those underperform kate What's your best guess as to why Investors Didn't value them as highly as they did You know tech stocks Yeah there are a couple of things going On some of them real some of them Perceived in the case of something like Exact sciences The sales people couldn't get in front Of the doctors because of covid There are other cases where procedures Could not get done because of covet it Was basically one word covet in the case Of something like teledoc teledoc had Done so well Because of telemedicine that when there Was this perception that the the things Were reopening teledoc just fell Completely out of favor united usph United states physical therapy this is One where procedures have not gone down They provide Um they provide
Excuse me They provide physical therapy services Um and Numbers were not down they were up 18 Over 2019 yet the stock did not perform Well so i think those are some of the Names you have to keep an eye on hey Kate you know Good go ahead Along those lines there have been some Covet plays that have done extremely Well I would keep an eye on those Your quest Even cvs cvs stated that their numbers Are going to be down because they're not Going to be doing as many covet jabs as The year before so those are some of the Names that i would keep an eye on Moderna up over 100 percent i would keep An eye on that i would trim those back So kate you know over the last couple of Years i cautiously embraced some of the Cyclical trades out there you know Energy for example but i have to have Been much more comfortable with Tech names that have you know strong Top-line growth you know tons of free Cash flow how do you think about the Technology sector of the next couple of Years it's been such a good sector for So many years do we still have some room To grow there We do have some room to grow in
Technology i think we are favorable on Technology for a number of reasons Uh technology generates a lot of free Cash flow unlike in the past you don't Have a lot of employees you've got a Couple of guys a couple of silicon Valley bros coming up with the software Maybe using a server a few computers And they come up with these sas models Software based and you they can make a Tremendous amount of money so technology Is the sector we favor when you look at Some of the mega cap tech stocks like a Microsoft like an apple they have done So well that you could see them Still continuing to deliver on the Numbers but the stock price is not doing Anything so i look at names that are Also very strong like octa like intel Like fi serve visa has had a couple of Tough years i think visa could be very Strong i'm not as positive on square but Squares had a rough year so i look at Some of those names And i say those are the places you Should focus on fundamentally everything Has become technology from the factory Floor to the eye doctor technology is Everywhere so i am a long-term Technology goal First of all kate i want to say um I'm tired of the term bro being used in Such a derogatory sense I'm i'm joking i'm joking um look you
Were about to say what you would avoid Financials i know has won energy is one And Energy has been the huge winner Of uh 2021 right if you look at a Breakdown of the s p 500 industry groups Energy up almost 50 percent Financials have done pretty well to 33 Why would you avoid these and i'm Wondering if your Your bullishness on tech leads to Bearishness on these sectors They're not really related we can we can Start with financials okay the Financials have been a tough group just To give you a very quick history lesson Financials 1.0 was the m a era remember Worst union in bank of america and Financials 2.0 Because once you've done all the m a it Was well make it up on volume we're Going to lever up and we're going to Lend lend lend that led to the 2008 Crisis Now with financials You have to have very strong Common equity tier one ratios so you Don't have a lot of loan growth you've Got a lot of deposits coming in People are not using the banks like they Used to you've got fintechs nibbling Away at them so the financials are Saying you've got to say to yourself Fundamentally
Where are they going to get the loan Growth you go to start a business today It's going to be a service business You're not going to go out and need the Banks So my that's my problem with the Financials people could say i'm gonna Buy the financials because i think You're gonna have a steepening yield Curve i say i cannot make Buy the financials on a macro call the One thing you do get with the financials Is you get some candy every month they Pay strong dividends that's important
