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Speaker 1: Welcome to the Bloomberg Markets Podcast. I'm Paul Sweeney alongside

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Speaker 1: my co host Matt Miller. Every business day we bring

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Speaker 1: you interviews from CEOs, market pros, and Bloomberg experts, along

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Speaker 1: with essential market moving news. Find the Bloomberg Markets Podcast

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Speaker 1: on Apple Podcasts or wherever you listen to podcasts, and

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Speaker 1: at Bloomberg dot com slash podcast. I want to get

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Speaker 1: to a NASDAK guest. Lauren Dillard joins us now. She's

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Speaker 1: head of Intelligence investment Intelligence at at NASDAC, where she's

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Speaker 1: an executive vice president. And Lauren, You've got a lot

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Speaker 1: of great experience, including um working at the Carlisle Group.

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Speaker 1: But you know, the the NASDAC name jumped out at

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Speaker 1: me today because of UM, the rotation that we've been

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Speaker 1: seeing lately and then the huge jump today. Do you

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Speaker 1: have any thoughts on value versus growth, Nasdaq versus Dow,

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Speaker 1: um Tech versus old economy. Well, first of all, thank

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Speaker 1: you for having me, and I am am Apell, a

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Speaker 1: time user and they joined the Nazack one hundred at

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Speaker 1: the end of last year, so let's make sure we

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Speaker 1: speak to that first. UM. Look, I think a couple

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Speaker 1: of things, UM, what you're certainly seeing our investors expressing,

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Speaker 1: you know, concerns around rates UM frankly, some uncertainty and

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Speaker 1: moving maybe into more cyclical sectors that were out of favor.

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Speaker 1: If you look back to March of last year, UM,

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Speaker 1: the NAZAK composite has almost doubled. So UM. That was

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Speaker 1: certainly an expression of a belief in what we would

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Speaker 1: call the you know, the digital economy that people certainly

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Speaker 1: believe in. NAZAC one hundred represents UM. We saw position

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Speaker 1: degree brillion of influence. But I think what you're seeing

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Speaker 1: now is is a broadening expression with some of the

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Speaker 1: uncertainty that's going on. So, Lauren, one of the things

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Speaker 1: we've really seen over the last twelve months, it's really

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Speaker 1: been fascinating, has been the really the surge in specs UM.

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Speaker 1: They you know, started out with a trickle and we've

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Speaker 1: seen specs over the years, but it's been really a

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Speaker 1: small part of the market. It's just exploded over the

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Speaker 1: last twelve months. What do you make at it from

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Speaker 1: your perspective at the NASDAC, Yeah, Um, you're exactly right.

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Speaker 1: I think in two thousand fourteen we had a stat

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Speaker 1: that they counted for about three percent of the deals

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Speaker 1: and year to date, in one we have welcomed a

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Speaker 1: hundred and forties six packs once the NAJAC. So UM,

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Speaker 1: it's definitely, ah, you know, a significant way that UM

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Speaker 1: people are accessing the public markets. I mean as a

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Speaker 1: market provider, I think, you know, we saw several years

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Speaker 1: and the States back of course too to my time

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Speaker 1: at the Carlover where companies were staying private longer UM

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Speaker 1: they were in the hands of private investors, and that

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Speaker 1: was certainly a trend we were seeing. Now you're seeing

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Speaker 1: companies accessing the public markets, whether it's via I p

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Speaker 1: O s, whether it's via direct listings. And then of

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Speaker 1: course back I think, of course there's an important sort

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Speaker 1: of education UM market understanding underpinning that that is there

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Speaker 1: by it UM. I I actually believe if you think

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Speaker 1: about value creation UM for companies, that accessing the public

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Speaker 1: market and allowing those companies to be in the hands

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Speaker 1: of investors during more of the value creation is a

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Speaker 1: long term a good thing. I think it's theoretically to

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Speaker 1: me it's so cool because it's like the democratization of

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Speaker 1: earlier stage investing, or it's someone called it a poor

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Speaker 1: man's UM pe uh you know, I'm not going to

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Speaker 1: be able to get into a private equity deal. I'm

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Speaker 1: not a sophisticated investors, so I think it'd be sweet

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Speaker 1: to take a shot at a couple hundred of a spack.

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Speaker 1: The thing is, Um, it's it's gone beyond Haywire at

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Speaker 1: this point. I mean, there's a company called just another

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Speaker 1: acquisition corps Um. The numbers that you named already, Laura, Laura,

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Speaker 1: are are huge. And you know C C I V,

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Speaker 1: for example, trading at like seventy dollars um for a

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Speaker 1: while and then dropped like sixty the deal was announced

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Speaker 1: with Lucid. Isn't this a problem for retail investors? I mean,

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Speaker 1: aren't they getting in a little too deep? I mean,

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Speaker 1: I think it goes back to market education. It will

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Speaker 1: be interesting to see what our regulators decided to look

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Speaker 1: at their obviously looking at some of the trends going

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Speaker 1: on with lit markets, um with intelligent ticks if you

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Speaker 1: want to get into some of the market structure. So

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Speaker 1: you know, the regulators will have to decide where to look. Again. Um,

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Speaker 1: I think you're probably right. There's a fine line between

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Speaker 1: accessing the public market, which is a good thing. I

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Speaker 1: mean our whole belief at Nasadak is championing inclusive growth

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Speaker 1: and prosperity. So it aligns with market access, and it

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Speaker 1: aligns with getting value creation into the hands of investors.

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Speaker 1: But they are they are riskier and people have to

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Speaker 1: understand their rights. Lauren, what's the outlook for I p

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Speaker 1: O S in one. It looks like, um, you know,

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Speaker 1: the stock markets at a near all time highs seems

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Speaker 1: and we have an economy reopening. Seems like conditions will

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Speaker 1: look pretty good. Yeah, the pipeline is incredible, really strong.

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Speaker 1: Um And already, frankly, have we've seen more companies UM.

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Speaker 1: I think it's a hundred and forty eight and I'm

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Speaker 1: quoting that number UM Access actually the public the public

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Speaker 1: markets year to date, so it's we've already are seeing that.

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Speaker 1: I think that's a good thing. Again, going back to investors,

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Speaker 1: UM And and certainly you would argue the window is

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Speaker 1: open and we still have a strong pipeline. UM. I

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Speaker 1: just want to quickly ask you about trading. What are

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Speaker 1: your thoughts on the whole pay for order flow situation?

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Speaker 1: Since we're talking about this already, might as well get

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Speaker 1: get into it. UM. You're a market provider. This touches

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Speaker 1: obviously everything that you do, UM does. Does that worry

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Speaker 1: you or do you think we're going to be able

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Speaker 1: to find a decent solution to it? So I mean,

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Speaker 1: as a capital markets operator, we believe obviously in fair

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Speaker 1: and open markets and form all market participants. So we

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Speaker 1: have been saying that the rise of the retail investor

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Speaker 1: participating in our markets is a good thing UM, and

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Speaker 1: it's certainly reflected in UM in the numbers we've seen

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Speaker 1: and frankly, in a time if you look back from

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Speaker 1: a year from now, the volumes of that have that

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Speaker 1: have transacted on the markets between equities and options, it's

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Speaker 1: extraordinary and we as a market provider are very frankly

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Speaker 1: proud of that resiliency. UM. It's something we've invested in

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Speaker 1: as you look forward for retail, for retail trading and

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Speaker 1: the discussions that the the SEC and SENERA are looking at.

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Speaker 1: You know, we've engaged with our regulators for close to

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Speaker 1: two decades on you know, very arguably esoteric but really

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Speaker 1: important market structure concepts, having lip markets, having price discovery UM.

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Speaker 1: We're obviously subject to regulatory oversight. UM Intelligent tixs you

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Speaker 1: heard in the SEC discussions around tick sizes, um and

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Speaker 1: all of that is with with the lens of making

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Speaker 1: you know, price discovery. Financial markets serve all investors, including

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Speaker 1: retail investors, so without into the nuances of payment for

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Speaker 1: order flows. I think broadly speaking, we as a capital

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Speaker 1: markets provider want there to be fair and transparent markets.

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Speaker 1: We would like these investors to stay in the market

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Speaker 1: long term. I think that's very important to us. Hey, Lauren,

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Speaker 1: thanks so much for joining us. We appreciate it. We

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Speaker 1: always like speaking to smart people that come out of

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Speaker 1: the Robin School of Business at the University of Richmond,

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Speaker 1: my alumn I'm an alumnus there, so it's great to

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Speaker 1: speak with you. Lauren. Lauren is the e d P

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Speaker 1: Head of Investment Intelligence at the NASTAC Private What a

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Speaker 1: cool title. What a cool I mean, what that's an

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Speaker 1: awesome title. I'd love to have that, But also what

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Speaker 1: a cool career. I mean she managed more than thirty

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Speaker 1: billion dollars in assets across six international offices at the

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Speaker 1: Carlisle Group, which is already an incredible name, and then

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Speaker 1: moving on to Nasdaq, which is kind of the you know,

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Speaker 1: the modern story of equity markets. I mean, the old

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Speaker 1: stuff is like old. And you know I was talking

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Speaker 1: about the Dow Jones Industrial Index earlier. The kids don't

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Speaker 1: even don't even talk about that. John Farrell, Yeah, you

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Speaker 1: can't talk about you can't quote the down joys industrials

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Speaker 1: to John Ferrey gets all upset. So we'll have more

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Speaker 1: coming up. This is Bloomberg, all right, Matt Miller. I'm

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Speaker 1: gonna tell you one of my bucket list items which

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Speaker 1: you probably wouldn't guess, and that is to take a

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Speaker 1: trip on one of those big ocean going cargo ships,

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Speaker 1: you know, the ones to see out there on the

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Speaker 1: ocean with a container ships stacked like twenty high. I

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Speaker 1: have no idea how those things float, how they don't

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Speaker 1: tip over, how the cargo doesn't fall into the sea.

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Speaker 1: But maybe our next guest can help me hit your

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Speaker 1: ride there. Gary Vogel, CEO and director of Eagle Bulk Shipping.

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Speaker 1: They're based at Stanford, Connecticut. Boy, it's a public company

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Speaker 1: trades on the nastac on aner the symbol e g

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Speaker 1: l E. The stocks had a great run as economy

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Speaker 1: start to open up, up eighty six percent year to date,

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Speaker 1: up eleven percent over the trailing twelve months. Gary, thanks

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Speaker 1: so much for joining us here. Boy. When we talk

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Speaker 1: to you, Gary, we get a great, great bird's eye

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Speaker 1: view of the global economy. What can you tell us

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Speaker 1: about global shipping and what that's what that's telling you

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Speaker 1: about the global reopening? Yeah, well, as you said, it's

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Speaker 1: it's really is about this UM. This reopening, I mean

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Speaker 1: was severely impacted. It was a tale of two halves

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Speaker 1: the first half of the year, a real UM a

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Speaker 1: real demand shock. Uh. You know, dry bulk is highly

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Speaker 1: correlated to global GDP. We actually don't carry containers. Are

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Speaker 1: ships carry you know, bulk cargoes commodities such as grain, minerals, cement,

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Speaker 1: and fertilizer. But but really you know, building building products

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Speaker 1: if you will, for the global economy. And so, but

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Speaker 1: what we've seen is by the fourth quarter UM a

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Speaker 1: real return and many many of our commodities to pre

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Speaker 1: COVID levels. And uh, that's that's also continued to into

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Speaker 1: the first quarter. And that's also on the back of

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Speaker 1: what's been fairly muted supply growth as well. On terms

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Speaker 1: of ships. So, but these are ships that I mean,

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Speaker 1: you send them a long way, right, they go all

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Speaker 1: the way around the world. Um not just like from

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Speaker 1: uh Charlotte too. I don't know absolutely do you ever

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Speaker 1: have stowaways or do you Is there a way for

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Speaker 1: Paul to to just buy a ticket and take a

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Speaker 1: ride from like the Horn of Africa to I don't know,

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Speaker 1: Um Australia, is that is that a possibility? Well, we

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Speaker 1: we don't. We don't take passengers. They're they're on occasion.

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Speaker 1: There are issues with stowaways, but but the industry deals

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Speaker 1: with that. But we don't take passengers on board our

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Speaker 1: ships now, so sorry about that. Gary. You know, one

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Speaker 1: of the things we've seen, and again I'm really fascinated

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Speaker 1: by the global shipping business in the big ships that

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Speaker 1: you guys operate. Uh, but I've seen, you know a

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Speaker 1: lot of stories over the past a month or two

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Speaker 1: about ships having a hard time unloading their goods in

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Speaker 1: various ports around the world, perhaps due in part two,

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Speaker 1: you know, that just aren't enough workers there, maybe due

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Speaker 1: to COVID to to you know, unload things and load things.

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Speaker 1: And what are you finding in that regard? Yeah, I

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Speaker 1: think what you're speaking to again is the headline has

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Speaker 1: been about the container industry and and and significant congestion.

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Speaker 1: You fortunately dry balk we go to different terminals, and

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Speaker 1: notwithstanding certain areas of congestion, in general, UM the trade

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Speaker 1: flows have been fairly normal, and so we've been able

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Speaker 1: to to meet demand, increase demand, and and and get

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Speaker 1: cargoes on and off ships. Now with the exception really

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Speaker 1: of the second quarter into the third quarter of last year,

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Speaker 1: as as countries you know, send people home to stop

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Speaker 1: the spread of COVID nineteen. But we're really operating, you know,

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Speaker 1: quite efficiently. Now. You know, one of the one of

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Speaker 1: the challenges last year, which if I can take a moment,

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Speaker 1: it was the humanitarian crisis of trying to repatriate our seafarers,

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Speaker 1: our crew on board the ship. We typically work about

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Speaker 1: six months, and as countries enacted these trade travel restrictions

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Speaker 1: excuse me, um, you know, these people were unable to

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Speaker 1: get home and and so there's been a real push

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Speaker 1: within the industry. We were fortunately able to to you know,

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Speaker 1: UM return to normal by by November, and the industry

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Speaker 1: is focused on it now to ensure that doesn't happen again.

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Speaker 1: But that was probably the biggest challenge we faced as

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Speaker 1: an industry last year. Terrifying. Actually, there's a Bloomberg Business

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Speaker 1: Week story about not shipping employees, but cruise employees that

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Speaker 1: faced really traumatic conditions. UM. Glad that's over for for

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Speaker 1: your people, Gary, and that the um that the industry

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Speaker 1: seems so healthy right now. I wonder what the biggest

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Speaker 1: concern is going forward? What are the headwinds so to speak?

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Speaker 1: There's literally no pun intended. But is fueling an issue?

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Speaker 1: Is the greening of the earth a problem? Or is

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Speaker 1: the way you can is there a good way you

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Speaker 1: can work with that? Yeah? So a few things to unpack.

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Speaker 1: Their one is um, you know that the the you know,

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Speaker 1: challenge for for shipping rates historically has been an oversupply

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Speaker 1: of tonnage. In fact, dry boat demand has grown in

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Speaker 1: eighteen of the last twenty years, the two out hours

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Speaker 1: being the financial crisis and last year COVID, So we

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Speaker 1: haven't had a demand issue. It's really as I mentioned,

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Speaker 1: linked to global GDP growth, So supply we've had an oversupply,

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Speaker 1: but at the moment, supply of ships is actually at

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Speaker 1: a twenty five year low at just six percent of

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Speaker 1: the of the on the water fleet. So I think

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Speaker 1: that boads very well as you have you know, demand

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Speaker 1: and GDP growth coming back with a limited amount of

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Speaker 1: ships supply coming in and you mentioned the greening. I mean,

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Speaker 1: you know, emissions reduction and decarbonization is on the forefront

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Speaker 1: of all the discussions within shipping and and dry bulk

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Speaker 1: is no exception. And and as as we are looking

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Speaker 1: towards zero emission vessels to get to the I m

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Speaker 1: O targets of a reduction of fifty by fifty and

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Speaker 1: so because of that uncertainty about what future regulations will

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Speaker 1: mean is also uh, you know, a reduction of ordering

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Speaker 1: because of that uncertainty. Right, It's it's an impediment to

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Speaker 1: ordering because you simply don't know how long the vessel

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Speaker 1: you order today will actually be allowed to trade due

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Speaker 1: to emissions regulations. All right, It's really interesting and we

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Speaker 1: could do that's another thing. We could do a whole

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Speaker 1: show on right now. And I talk so in go.

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Speaker 1: I talked to a lot um up here well up

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Speaker 1: in Copenhagen, and he talks a lot about the fuel

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Speaker 1: issue as well. Gary. It's been great to have you

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Speaker 1: on the program. Thanks very much. It's a bummer that

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Speaker 1: you don't even let a few people travel as passengers,

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Speaker 1: because I know, Paul, it's not just your dream a

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Speaker 1: lot of people want to get on a shipping, a

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Speaker 1: container ship or a dry good ship and and take

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Speaker 1: a long trip, maybe as a stowaway. It's a little

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Speaker 1: bit easier, Gary Vogel there from Eagle bulk Shipping. Let's

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Speaker 1: get back to the markets, because, of course Greg was

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Speaker 1: talking about the rally that we're seeing in equities and

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Speaker 1: not the chicken sandwich maker. David Dietz joins us right now.

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Speaker 1: He's managing principal and senior portfolio strategist at Peapack Private

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Speaker 1: Wealth Management. David, Um, I I wonder when I look

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Speaker 1: at this, and I've been asking all of our guests today,

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Speaker 1: um is the rotation that we saw, kind of a

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Speaker 1: surprised rotation over from UM from growth to value as

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Speaker 1: we see the NASDAC today rally and dow UM not

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Speaker 1: doing nearly as well well. Certainly, UM, what's been driving

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Speaker 1: the tune tune here is this rapid rising interest rates

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Speaker 1: from the start of the year with the tenure treasury

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Speaker 1: below one percent, got up uh close to about one

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Speaker 1: point six percent, and that did feed this huge rotation

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Speaker 1: into stocks that will do well with the economic reopening.

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Speaker 1: UM banks of course can loan money at higher rates. UH,

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Speaker 1: some of this uptick and interest rates is due to

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Speaker 1: inflationary fears, and so commodities, energy industrial is doing well.

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Speaker 1: And of course they rotated out of the NAZDAC the

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Speaker 1: David territory yesday, David today. Of course it's going the

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Speaker 1: other way around, David. Doesn't that march higher for rates?

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Speaker 1: Doesn't it have a lot further to go? I mean,

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Speaker 1: I've talked to a few people who are real outliers.

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Speaker 1: Scott Minored, for example, thinks the tenure could go negative.

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Speaker 1: But most other people are saying, look, with the incredible

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Speaker 1: growth ahead of us. Bloomberg Economics UM did a survey

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Speaker 1: UH and found seven point six percent expectation in nominal

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Speaker 1: GDP growth, then rates have to keep going higher from here.

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Speaker 1: You know. I tell my clients that said, there's only

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Speaker 1: one thing more difficult than predicting the direction of the

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Speaker 1: stock market, and that's predicting the direction of interest rates.

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Speaker 1: But I'll tell you this, If the vaccine rollout continues

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Speaker 1: to march along well, if the stimulus is well distributed

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Speaker 1: and we see another infrastructure bill coming down the pike,

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Speaker 1: If UM, the Federal Reserve does not try and somehow

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Speaker 1: captorizing interest rates. If consumer confidence continues to go in

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Speaker 1: the right direction, I do think there will be a

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Speaker 1: normalization of the economy. That will mean a normalization of

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Speaker 1: interest rates. Remember in two thousand nineteen interest rates range

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Speaker 1: between two point eight and one eight. Why wouldn't they

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Speaker 1: go back to those levels? So I think that's the

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Speaker 1: path of least resistance, all right, given that bullish background, David,

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Speaker 1: what are some of the names you like right here

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Speaker 1: that you guys are working on. Yeah. Absolutely, So you've

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Speaker 1: got to stay with tech. We've got the long term

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Speaker 1: themes um uh tail winds for increase use of technology.

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Speaker 1: We've heard about the chip shortage. So I want to

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Speaker 1: go with the number one chip producer in the world,

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Speaker 1: which is Intel. And what I like about Intel it

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Speaker 1: has a cyclical twist to it because it's the chip manufacturer.

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Speaker 1: It also has a value twist to it because of

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Speaker 1: its valuation. You've got a too, almost two and a

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Speaker 1: half percent dividend you're creating about twelve times earnings, is

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Speaker 1: the largest in the world. And also it allows you

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Speaker 1: for participation in for example, artificial intelligence, autonomous driving, uh,

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Speaker 1: the movement to the cloud, and so you kind of

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Speaker 1: have your best of both worlds. You've got the tech exposure,

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Speaker 1: plus you've got your you know, your value exposure, which

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Speaker 1: I think it's going to do well this year. I

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Speaker 1: think I heard you mentioned the word infrastructure, and for

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Speaker 1: me this is one of the most exciting things about

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Speaker 1: the not too distant future. We all know the two

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Speaker 1: trillion dollar fiscal stimulus package is going to be uh,

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Speaker 1: we're we're likely to see it past in the next

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Speaker 1: few days. But for me, even more exciting is thinking

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Speaker 1: about what President Biden will do in terms of stimulus

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Speaker 1: spending or infrastructure spending. What do you expects there? So,

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Speaker 1: you know, I think that you know, once they notch

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Speaker 1: this early win in the Biden administration under their belt

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Speaker 1: with the near two trillion regular stimulus, I think they

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Speaker 1: are going to push ahead and get something in infrastructure.

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Speaker 1: What I think is going to be interesting here is

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Speaker 1: there's not just gonna be bridges, tunnels, and roads. I

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Speaker 1: think it's also going to include, um, you know, the

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Speaker 1: expansion of the Internet to those who have less access

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Speaker 1: to it. So my stock for my clients here for

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Speaker 1: that is Verizon. Now, Verizon is the stock that still

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Speaker 1: hasn't come back to where it was in late ninety nineties.

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Speaker 1: But if you're talking about five G, Verizon is your play.

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Speaker 1: They've just spent big time to get more spectrum um

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Speaker 1: there by far the best wireless service out there, and

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Speaker 1: so I think that you know, uh, with your four

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Speaker 1: and a half percent divedn about twelve times, earning the

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Speaker 1: Horizon is a low risk way to play expansion of

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Speaker 1: the Internet that could be fueled by an infrastructure package.

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Speaker 1: About thirty seconds, I know, fightsers on your list, has

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Speaker 1: this been a pre pandemic players? Is this your play

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Speaker 1: on their their vaccine? Yeah? You know, I think it's both.

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Speaker 1: So the stuck ran up to about forty three on

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Speaker 1: the excitement of being the first to get the emergency

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Speaker 1: use authorization from the FDA up there, and now it's

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Speaker 1: back down to thirty four. Why is that because there's

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Speaker 1: two reasons. One is, if we have this big economic expansion,

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Speaker 1: what does that do to healthcare? Do people use more drugs?

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Speaker 1: Probably not. Second, there is still concerned as to whether

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Speaker 1: heavy handed legislation comes out of Washington, but I think

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Speaker 1: that's well priced into the stock. Remember, healthcare is the

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Speaker 1: other growth sector. You've got about a four and a

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Speaker 1: half percent dividend on fires about thirteen fourteen times earnings,

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Speaker 1: the best d pipeline, and also great exposure overseas who

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Speaker 1: wanted the same kind of deluxe health care that we have.

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Speaker 1: So I think this is a nice way to participate

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Speaker 1: in continued growth in the stock market without taking a

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Speaker 1: whole lot of risk. Hey, David, thanks so much. We

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Speaker 1: really appreciate it. As always, nobody pitches a name better

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Speaker 1: than David Deeds. He gets it all out there in

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Speaker 1: twenty to thirty seconds. Nobody does it better David Deed's

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Speaker 1: managing principle. And see your portfolio strategist at Pepack Private

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Speaker 1: Wealth Management in Lovely Summit, New Jersey. Let's take a

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Speaker 1: look at the auto business. Man, I know you're a big,

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Speaker 1: big auto van gear head. Let's take a look at

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Speaker 1: the car parts business. There's nobody better to do that

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Speaker 1: with than Left Peaker. He's the CEO of car Parts

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Speaker 1: dot Com. Love thanks so much for joining us here.

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Speaker 1: We're Matt and I were just looking at the five

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Speaker 1: year chart for your stock again. The symbol is PRTs

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Speaker 1: Trades on NASDAK. It was kind of just, you know,

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Speaker 1: almost a penny stock. Therefore, we're looking at the five

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Speaker 1: year chart until you know kind of you know, kind

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Speaker 1: of March of last year, and then it just exploded.

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Speaker 1: Is this a pandemic play? Is that what your stock

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Speaker 1: has become? Yeah, that's a common misconception. I think you know,

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Speaker 1: the business wasn't really going anywhere for a long time. Um.

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Speaker 1: You know, the company has been public since two thousand eight. Uh,

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Speaker 1: didn't really grow for twelve years, and then an entirely

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Speaker 1: new management team came in. UM I started in January

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Speaker 1: of two thousand nineteen, and we executed a great turnaround

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Speaker 1: plan focusing on solving a customer problem. And uh, last

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Speaker 1: quarter alone, we grew nine For the full year, we

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Speaker 1: grew fifty two fifty million, and so you know, we're

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Speaker 1: we're executing really well. I'm really proud of the way

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Speaker 1: the team is executing right now. And uh, wait, way

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Speaker 1: beyond the pandemic now. But I mean, it can't be

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Speaker 1: just a coincidence that your stock is trading for like

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Speaker 1: two or three bucks for four years. I mean it's

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Speaker 1: fair to say that you executed on a plan to

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Speaker 1: even double revenue, but in March of you go from

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Speaker 1: like a dollar thirty seven to more than twenty dollars

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Speaker 1: a share. UM, that's gotta be more, have more to

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Speaker 1: do with something else than just doubling revenue, right, I mean,

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Speaker 1: what's your outlook? Yeah, so we just released a long

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Speaker 1: term model UM, and what we believe is that we

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Speaker 1: can grow at er over over the long term. We

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Speaker 1: also believe that we can achieve the dumb margins, and

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Speaker 1: so we have a really bright outlook. We're only limited

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Speaker 1: by the inventory that we have. Uh, there's no no

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Speaker 1: demand issues at all. Demand is really strong and so

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Speaker 1: UM by positioning the inventory closer to the customer, we

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Speaker 1: believe we can disrupt an industry where business has really

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Speaker 1: been done the same way for the last shift. Now,

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Speaker 1: are you're talking about the parts? Are you talking about

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Speaker 1: the parts industry or electric car UM industry? Because I

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Speaker 1: know you're starting an e v UM UH plug in

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Speaker 1: hybrid hub as well to sell whole cars, right, correct,

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Speaker 1: not to sell whole cars. You know, we're really focused

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Speaker 1: on UH selling parts UM and so for us, disrupting

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Speaker 1: industry means you know, selling selling more parts. I am

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Speaker 1: going against the likes of Auto Zone and advances and

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Speaker 1: so yeah, yeah, well for evs as well, of the

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Speaker 1: parts that we sell our power train agnostic and so

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Speaker 1: you know, the NYV vehicle has the same will hubs

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Speaker 1: and shots and struts and control arms, um and bumper

428
00:23:42,080 --> 00:23:44,360
Speaker 1: covers and mirrors. So a lot of the parts are

429
00:23:44,359 --> 00:23:47,439
Speaker 1: really agnostic to the power train. And so we're just

430
00:23:47,480 --> 00:23:50,240
Speaker 1: focused on solving the customer problem and getting them back

431
00:23:50,240 --> 00:23:52,840
Speaker 1: on their oath. Uh, let's talk to us about the

432
00:23:52,880 --> 00:23:55,240
Speaker 1: competitive position here. You mentioned a couple of your competitors.

433
00:23:55,359 --> 00:23:58,040
Speaker 1: Where does car parts dot Com stand in terms of

434
00:23:58,080 --> 00:23:59,920
Speaker 1: market share in this business and kind of what you're

435
00:24:00,119 --> 00:24:03,640
Speaker 1: your goals and aspirations. Yeah, so this is a really

436
00:24:03,720 --> 00:24:09,080
Speaker 1: large industry um billion dollars um. We're a tiny company

437
00:24:09,160 --> 00:24:12,960
Speaker 1: with only half a billion in revenue. And so you know,

438
00:24:13,040 --> 00:24:15,359
Speaker 1: we think that by getting closer to the customer and

439
00:24:15,440 --> 00:24:18,320
Speaker 1: we have a unique value proposition and that we get

440
00:24:18,320 --> 00:24:20,280
Speaker 1: the parts from the factory, will put them in our

441
00:24:20,320 --> 00:24:23,359
Speaker 1: distribution centers, and we'll ship them straight to the customers.

442
00:24:23,760 --> 00:24:27,960
Speaker 1: So by cutting out all the middleman, we're able to

443
00:24:27,960 --> 00:24:30,040
Speaker 1: pass on a lot of the savings to the customers.

444
00:24:30,080 --> 00:24:33,080
Speaker 1: So most of our parts are you know, fifty to

445
00:24:33,200 --> 00:24:36,399
Speaker 1: sevent cheaper than you will buy them at your local

446
00:24:36,840 --> 00:24:40,879
Speaker 1: advance or AutoZone store, and so that's how we believe

447
00:24:40,920 --> 00:24:42,919
Speaker 1: we can win by passing on a lot of the

448
00:24:42,920 --> 00:24:45,760
Speaker 1: savings to the consumer and cutting out all the middlemen.

449
00:24:47,119 --> 00:24:50,440
Speaker 1: Are you do you think that your customers are going

450
00:24:50,480 --> 00:24:53,920
Speaker 1: to increase in number due to the pandemic in any way?

451
00:24:53,920 --> 00:24:56,360
Speaker 1: I mean the idea that people won't want to ride

452
00:24:56,359 --> 00:24:59,560
Speaker 1: the subway anymore or buses, They're gonna want to buy cars,

453
00:24:59,600 --> 00:25:02,200
Speaker 1: and maybe the used car market is a huge part

454
00:25:02,240 --> 00:25:06,280
Speaker 1: of that. Is that part of your plan that is correct.

455
00:25:06,320 --> 00:25:10,119
Speaker 1: So a few tailwinds here. One is that you know,

456
00:25:10,160 --> 00:25:13,800
Speaker 1: more people will be relying on personal mobility. Uh, there's

457
00:25:13,840 --> 00:25:16,800
Speaker 1: going to be more used cars on the road. Um. Additionally,

458
00:25:16,840 --> 00:25:18,800
Speaker 1: it's not good for cars to be parked for a

459
00:25:18,800 --> 00:25:21,639
Speaker 1: while and driven, then parked for a whild and driven again.

460
00:25:22,040 --> 00:25:24,639
Speaker 1: A lot of the rubber gaskets and things like that breakdown.

461
00:25:25,400 --> 00:25:27,679
Speaker 1: People have been delaying some of the maintenance because they

462
00:25:27,680 --> 00:25:30,520
Speaker 1: haven't been driving as much. UM. So all of these

463
00:25:30,520 --> 00:25:33,760
Speaker 1: are tailwinds because eventually, you know, cars start breaking down.

464
00:25:33,840 --> 00:25:36,120
Speaker 1: And there are a lot of cars on the road today,

465
00:25:36,160 --> 00:25:39,200
Speaker 1: about two days seven million in the US UM and

466
00:25:39,240 --> 00:25:41,440
Speaker 1: the average age of the vehicle is about twelve years,

467
00:25:41,520 --> 00:25:43,680
Speaker 1: So a lot of old cars on the road. This

468
00:25:43,760 --> 00:25:46,359
Speaker 1: is great for us. By the way, you used to

469
00:25:46,400 --> 00:25:51,040
Speaker 1: be at RAMA, which if people don't know the U,

470
00:25:51,200 --> 00:25:55,720
Speaker 1: the A V space and cameras, it's huge. So what

471
00:25:55,760 --> 00:26:00,000
Speaker 1: are you bringing from Adderrama to car Parts? I say,

472
00:26:00,040 --> 00:26:04,800
Speaker 1: get just a relentless focus on on the customer. And uh.

473
00:26:04,880 --> 00:26:08,080
Speaker 1: You know, electronics is a tough space to be in

474
00:26:08,800 --> 00:26:11,040
Speaker 1: because margins are so low, and so you have to

475
00:26:11,080 --> 00:26:16,000
Speaker 1: find a way to differentiate yourself from all the other competitors.

476
00:26:16,040 --> 00:26:19,120
Speaker 1: You know, Buz, Buy, Amazon, you have some some big

477
00:26:19,119 --> 00:26:22,080
Speaker 1: guys in the electronic space. And so at the ROAMA

478
00:26:22,080 --> 00:26:24,439
Speaker 1: we did that by focusing on the customer and solving

479
00:26:24,440 --> 00:26:28,040
Speaker 1: our customers customer problem. That's what we're doing here as well.

480
00:26:28,520 --> 00:26:31,160
Speaker 1: All right, love great talking you love peaker there um

481
00:26:31,160 --> 00:26:33,639
Speaker 1: coming to us from car Parks dot com. Uh, and

482
00:26:33,720 --> 00:26:38,160
Speaker 1: what an interesting story. The stock has jumped more than

483
00:26:38,400 --> 00:26:43,359
Speaker 1: I guess tenfill over the last year. Thanks for listening

484
00:26:43,400 --> 00:26:46,880
Speaker 1: to the Bloomberg Markets podcast. You can subscribe and listen

485
00:26:46,920 --> 00:26:51,200
Speaker 1: to interviews with Apple Podcasts or whatever podcast platform you prefer.

486
00:26:51,600 --> 00:26:55,560
Speaker 1: I'm Matt Miller. I'm on Twitter at Matt Miller three,

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00:26:56,200 --> 00:26:58,879
Speaker 1: Opole Sweeney, I'm on Twitter at pt Sweeney. Before the

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00:26:58,920 --> 00:27:03,920
Speaker 1: podcast You Can Oh catches worldwide at Bloomberg Radient m