Week, what it means for advertising, spending and jobs. On my colleagues, ben levisohn, carlton english and jack howe. Ben, the market had a good week, and it seemed kind of placid on the surface but down below there was actually some really interesting crosscurrents. Thats right. And i think the first thing that the market had to deal with this week was the specter of renewed china u. S. Tensions. Hong kong sort of lingered there in the background, but its never been one where the other side seemed to be willing to act. I think we saw china pass a new security law for the city, and when trump said that he would respond to that on thursday, it actually caused the market to go from positive to negative. On friday he made an announcement, it wasnt as bad as the market thought, so the market rallied back. But its really something that the market is going to, i think, start to focus on. How much can tensions between the u. S. And china escalate, and how much [inaudible] does the u. S. Want to make out of hong kong. Jack so i dont want another worst case is scenario, but whats a bad Case Scenario . Whats a bad case for the market if tensions do, in fact, continue to increase . I think the thing we have to remember about hong kong is its a financial hub. If we start to see problems there would be first in the currency market. If you see problems with [inaudible] for chinas currency, it could spill over into with other Asset Classes around the globe. And the other reason the banking system, because banks have relationships with each other. If all of a sudden hong kongs banks arent allowed [inaudible] buzz with the outside world, really worst Case Scenario that could cause major problems too. Jack so the other issue is tech. Big tech has obviously become more and more dominant in the market, in the economy, and a lot of people have been wondering what could with knock them down a peg. Does this declaration by trump maybe start us down that road . I think it reminds us [audio difficulty] during this coronavirus period, seem to be part of the solution to whats going on. And the relationship between tech and the president seem to be okay. But with twitter putting a fact check on a couple tweets by the president , the president responding with an executive order calling for more regulation, it e really reminds us that big tech might have been [inaudible] quite so much, but its still there. So i think we have to worry about it a little bit because tech such an important part of the s p 500. The Big Five Tech Companies are 20 of the the dex index. If they start to fall, thats a huge problem. Jack yeah. Its really fascinating because so many people are gunning for big tech in a different way, some people concerned about antitrust that theyre too big, and others that come at it exactly the opposite direction of trump who say, look, youve got these massive platforms, people weaponize misinformation with no liability. Luckily, carlton is looking at the other half of the economy. Early this week particularly those really beatendown stocks that were seen as the worst victims of the coronavirus pandemic started to come back. So barrons looked at the best of breed that will benefit once traveling begins again. Absolutely. Thats the thing, you know, the itch for Summer Travel hasnt gone away, its just going to hook a lot different. You know, barrons reported, myself included, weve talked to a lot of people, and the key its going to be strive to versus fly drive to versus fly to. I think families are going to be more comfortable driving to places and having more control over the situation. What does all that driving mean . Increased demand for gas, gas lean, oil. So we were looking at marathon petroleum, number one refiner by capacity also planning to sell its Speedway Division this year giving the stock another potential boost. Two other plays in the energy space would be Valero Energy and phillips 66 both on that balance strength and the strength of their dividends. Thats what were looking at when it comes to energy. On airlines it gets a little bit trickier. The other thing is business and International Travel arent going to come back right away, so were looking at southwest airlines. 80 of its travelers tend to be the more leisure travelers. Areas that have reopened, you know, such as florida and texas, you know, those are kind of the prime areas for southwest. So thats why that one also looking pretty strong to us. Jack and even vegas may be coming back. Jack howe, im really excited for the first fitch to be thrown pitch to be thrown at citi field, but instead you tell me bowling will be the first sport to come back, if we can call it a sport. Whoa, whoa, whoa jack whoa look at that. The pba strike derby. Now, jack, its an exhibition event, not regular tournament bowling. But, you know, golf had an exhibition event a week ago. It got the biggest Television Audience on cable ever for a golf event. This bowling event, this is a prelude to the reopening of pro sports. In july you could have basketball, hockey, maybe baseball, right . Youre looking at football in september, jack. Jack i hope so. Nascar, thats been open since mid may. Im ready for the return of pro sports, jack. Jack you are clearly ready. What does this mean for the economy . Look, more sports on tv, its great for advertising. Advertising helps spend, and spending helps jobs. Theres no mom and pop football staid ups out there, but stadiums, but when we talk about bowling, theres this whole bowling renaissance going on. I want to give a shoutout to tommy at oak mountain lanes who i talked to this week outside birmingham, alabama. Opened up after 63 days closed because he saw a line out in the apartment, social distance, he said its going very well. Jack i think youll be at one of those places this weekend. Coming up, the ceo of the Storage Company box on how jack in a matter of weeks, companies all over the country converted to work from home endeavors. One Company Helping them is collaboration and cloud Storage Company box. Ceo aaron levie joins us now. Thanks so much for joining us. Can you just briefly explain what box does in addition to storing documents . A lot of people have heard of dropbox, thats a little bit more of business to consumers that your operation. Yeah. We started box this 2005 to solve basically one big problem which is helping businesses be able to securely share and collaborate and access their most important files from anywhere. If you are an organization like nasa or General Electric or Morgan Stanley and you have Mission Critical business processes that deal with lots of data and files, we are the platform that those organizations use to be able to manage their information. So were in about nearly 70 of the fortune 500 and about 100,000 Companies Globally use our product to be able to simplify how they work. Jack so, obviously, you are benefiting from us all working at home, but i want to ask youre an entrepreneur. Over time do we, without the ability to collaborate in person, do you expect that people becomeless innovative . Become less innovative . Actually, i just think we have to change how we think about the innovation process. So i think, you know, the sort of stereotypical, you know, thing that we think of when youre building a product you jump on a whiteboard and you ideate in realtime or you jump into a Conference Room and come up with great ideas which is, frankly, how it does work in most organizations today. But that actually ends up artificially constraining who can participate in that ideation and creativity process, where in the Organization People can come from, what kinds of people can participate. So weve actually been really end couraged by watching how our work is changing and our innovation is changing where we might have a slack channel that has 100 people and its coming up with ideas for a particular project and, obviously, that would be impossible to do in a physical meeting or in a normal physical environment. So i think what were going to see is a shift in how we think about innovation and think about that creative process. Its not necessarily better or worse, its just different and when you think about it as a different way to get work done, i think were going to see a lot of creativity, a lot of innovation comet. But that being said, we fundamentally believe theres going to be offices in the future, people are still going to come into the office. We just want to help companies be able to move to the cloud so they can remain secure and fundamentally be able to work from anywhere, introduce more flexibility in how they work whether its from home or at the office. Jack itll be fascinating if, certainly, the commute becomes a privilege and the office becomes a perk. I want to ask you about innovation because were hearing from a lot of people that, hey, over the past eight weeks we moved digitally to where we thought wed be in 2024, the head of the Morgan Stanley brokerage operation told me exactly that. So if 2021 is going to be 2024, what does 2022 look like . Give us a peek into the future from your eyes. Yeah. Well, its at this rate its very hard to predict, you know, how quickly things are actually changing because of the speeds. Weve never seen this fast of an acceleration of Technology Ripple through an economy, ripple through businesses. Usually when a new Technology Gets introduced to the market, it can take five or ten years for organizations to adopt those tools. So when the iphone came out, it took many, many years for most businesses to have mobile offerings. When Cloud Computing came out, it took at least a decade for organizations like banks and federal governments to be adopting those technologies. Now were seeing this dramatic compression in technology thats rolling through the entire flow, every supply chain, every Customer Experience has to move to the digital interfaces and cloud platforms. So i think, you know, its probably more how work itself is going to change as a result of us all being on this modern cloud infrastructure. Does wiz move faster business move faster, can we be more inclusive in who can participate in the digital economy, are we able to see transformation in all these industries that previously werent moving very quickly, hospitals being able to deliver telemedicine experiences, Government Agencies being able to digitize their work with their constituents. So i think were i think the second order effects of us all modernizing technology rapt rapidly is where well see a lot of exciting and, i think, optimistic outcomes as a result of this. But it is moving faster than we could have ever anticipated. Jack can you just tell me real quick, it used to be over onetime sales was an expensive stock, youre at three times and youre cheap in your sector. Do we need to worry that techs getting overvalued . I dont think i can pull it off in 20 seconds, but these markets have the potential of having 23 billion people globally using these technologies to be able to do their work whether its zoom or okta or sales force or service now. So i think the markets are far larger than weve ever imagined. So if the whole world moves to digital, theyre going to need these modern tools and platforms to run their businesses, and i think its what makes these markets very attractive and very large. No predictions at what companies should be trading at right now. Jack fair new. Aaron, thank you so much. Thank you. Jack coming up, how the ipo jack coming up, how the ipo market is comingggg jack coming up, how the ipo mthere are times when our need to connect really matters. To keep customers and employees in the know. To keep business moving. Comcast business is prepared for times like these. Powered by the nations largest gigspeed network. To help give you the speed, reliability, and security you need. Tools to manage your business from any device, anywhere. And a team of experts here for you 24 7. Weve always believed in the power of working together. Thats why, when every connection counts. You can count on us. Swrk jack since the market began its epic comeback in late march, tech stocks have surged, particularly newlyminted companies who have had i e pos in the past two years. Kathleen smith joining us now. Thanks for joining us. The market for initial Public Offerings looked like it might finally be recovering from the wework debacle, why are issues coming to light now . Yes, there are signs of life, and it looks like were going to have a hot summer of ipos. And the reason is that the existing companies that have gone public recently have traded very well. You can see the outperformance of the ipo index and e e tfs that track these indices, both u. S. And international. When the already Public Companies outperform, it sets the statement for issuance. Its kind of like when ipo returns are the fuel that drive issuing. Also volatility. Thats the other thing we need to have reduced volatility. And if you look at the vix which was up in the 80s in mid march, its now below 30, and thats a very important element to price ipos, that we have less volatility in the market. Jack so if all these companieses want to sell shares, should i be worried about taking the other side of the trade . Are they thinking maybe the markets going to fall, they want to get in while the gettings good . Sure. Theres not a limit to it, but on the other side we have an institutional ipo market, theres smart investors out there, and they know that theres fear in the market. The smart investors are looking at all these new companies coming out now because theyre going to be priced better, and theyre going to be more fundamentally strong than as we get locker in the cycle. Longer in the cycle. So this is the right time to be looking at the ipos that come out of this near term. What are the most Interesting Companies going prick in the future . Public in the future . The most exciting is next week, and thats warner music group. That company is growing because of its streaming revenue if, the record label companies are benefiting from that. Its one of the top record labels, and the numbers look pretty good. I think investors are going to receive that ipo well. Theyre expecting, like, 10 growth and steady business. Also the largest european ipo which just priced today in europe is called jd can e petes, and thats the second largest roaster, Coffee Roaster globally after nestles, and that company is a moderate grower but very profitable. Itll pay a 2. 5 2. 5 dividend yield. Its a consumer staple thats very nice in this market. But there is a very hot ipo that we think investors are really going to want to focus on, and that is in the software space, theres a Company Called zoom info. Not to be confused with zoom video. Its an extremely fastgrowing, 50 plus growing company. They are involved in a regeneration platform thats really popular and has tremendously strong and large cash flow margins. So you dont see Many Companies that look like this. I think, as i said, the early ones that come out of these downturns tend to be the most fundamentally strong and attractively valued companies for investors. So this one, zoom info, is worth keeping an eye on. Im just wondering, at the end of 2019 a lot of people were thinking companies would want to go public before the Election Campaign accelerates. Is that still true, that companies are going to want to go public before september, october, when the campaign really ramps up . Yes, because of the election ahead, that is why we think were going to have a hot summer of ipo issuance. The ipo market tends to go a little bit quiet during election years because theres risk associated with the market at that time. So that is why we think companies are going to focus and since theres so Many Companies, private companies are locked in as private companies that havent come out, we think itll be more of a buyers market than a sellers market. Well have a lot of choices. And as long as the valuation discipline stays there, should be a good time for ipo investors. Jack thank you so much, kathleen. Up next, round table members give their investment ideas for the coming week. I used to worry about hair loss. But now im keeping my hair keeps helps it stay right there keeps hair loss away, for a dollar a day thank you, keeps get started for one dollar a day at keeps. Com. Introducing new voltaren arthritis pain gel, the first and only full prescription strength nonsteroidal antiinflammatory gel available overthecounter. New voltaren is powerful arthritis pain relief in a gel. Voltaren. The joy of movement. Jack so, jack, now that youre working at home, i understand that in order to keep the house quiet, you just send your whole family out to the a tent in the backyard, is that right . Not yet. Well, thats for vacationing. Its for summer vacation, put pup a big tent in the backyard. Im pretty excited about it. Aye seen a report here that says recreational tent sale are up 30 . I mean, tents have been booming. Campfire equipment up 42 , hammock sales have doubled. This is a leading indicator, people have cabin fever right now. Heres my theory. Disney says theyre going to open disney world beginning on july 11th. Now, it starts with backyard camping out with the raccoons and skunks, but before long people are going to be ready to get back out there. I know theres all kinds of rules, i dont care if they replace mickey mouse with masky mouse, i think families are going to be ready for vacations soon. Jack i certainly am, i will tell you that, and it may not be in a tent. Carlton is also looking at vacations, and she really thinks there will be a behavioral change, and shes found a beneficiary. Yeah. For those who dont want to be with raccoons or skunks, were looking add extended stay america, basically, a hotel chain that has kitchens in room, goes with that kind of driveto mental dethat vacationers mentality that vacationers will have but still gets people out of the house in another low decision. Jackie and, ben, quanta sounds like an australian airline, but it has nothing to do with that. No, it basically repairs generators for utilities and fixes pipelines, and its projects like that. With value stocks finally doing well, ubs put out the report about stocks that were laggards [audio difficulty] and this one has started to. Its got some very consistent revenue in this maintenance kind of contract [inaudible] its looking really interesting right now. Jack yeah. Those kind of companies are interesting even if the underlying resource doesnt do well. Somebody is going to need their help, so they make money. Ben, carlton, jack, thank you, great ideas. Dont forget to follow us on twitter barrons online. Wear your masks, be healthy, and well see you next week announcer the following is a sponsored program for prostagenix, furnished by prostatereport. Com. upbeat music hi, this is larry king. Over 30 million men in america have prostrate problems. I know, i was one of them. 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