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tv   Fast Money Halftime Report  CNBC  October 27, 2015 12:00pm-1:01pm EDT

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scott over at headquarters. ♪ i get knocked down but i get up again ♪ ♪ you're never going to keep me down ♪ let's meet our starting line-up for today. joe is here along with stephanie, swrosh brown, and pete. john joining us today from the cboe. our game plan looks like this. is baba back? what the company's sales surge means for the stock and your money. is the darling ready to make a run? hot in politics. swran wells live in colorado today where the weed economy is booming. what the republican candidates for president might say about it. cnbc's debate tomorrow night. we begin with the countdown to apple earnings, though, and whether those results after the bell tonight can jump-start the stock. apple shares have lagged. other big techs like amazon, facebook, and google this year leaving investors to wonder what's been going on with the most valuable company in the world. pete, to you first. is this the day that apple gets
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its mojo back? >> i'm starting to blaef that it is. we started to see some of the folks bringing some of the numbers now. we see some of the estimates down and the price targets down. stocks around 115. can they execute, though? when you go back to a year ago or even last quarter, some of the concerns last quarter was, well, look at some of the i phones. they slipped down to -- doesn't seem like such a bad number. how has the transition really performed in terms of the latest and greatest from apple and are they buying into that? if they are, i think yesterday's read was an overread. we ran all the way up. we were pushing right up against that 200 day moving average in terms of the stock. right near that 120 level. then we pulled off 6 that, and then we dropped another 3% based upon dialogue semi. that's an absolutely amazing move to me in an overreaction yesterday. i think that creates an opportunity for today. >> steph, you're the portfolio
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manager. you are holding of the stock is underweight relative to your bench mash. that sort of speaks to what the stock has done. we're to date, up 4%. amazon a double. alphabet, google up 38. facebook up 33. what is wrong with this stock? >> like the cloud companies and software security companies better than something like apple year-to-date. i am concerned about dialogue. down 20%. they get 80% of their revenues from apple. their longer lead chips. that's -- for them to not only preannounce and guide lower, the guide lower is the thing that has me worried. we're not sure if that guide lower is pricing on their side or just weaker volumes, and that's the biggest question. i think, look, if they come in, it's not going to be in line. >> in line is not good enough.
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>> it might not be. that's our very short-term basis. they only do 77 million phones this quarter instead of 78, which is consensus. you and i are not having the same conversation. this is a company trading eight times free cash flow and -- buybacks and dividend and the s cycle historically is never as strong -- you might be setting yourself for a disappointment if you are expecting something other than what we've seen from 4s, 5s, et cetera. i think bigger picture, though, this is still a premier name to own. it's a big stock. you should not expect for it to make gigantic moves in one direction to the other after earnings, but, yeah, if you think the s cycle is going to be monstrous, maybe you'll be dig appointed, but if you are longer term investor, that's probably your opportunity to get in rather than make a sale. >> where are all these other sales outperforming apple this we're? >> you know, i think you have to
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look at what apple really did in july to august. you had a 30-day period. think about the year-to-date performance of apple. you are talking about a $30 trading range. in that one month period between july and august, apple had a $29 move. 29 out of the 30 dollars occurring in a four-week time. that's just the unraveling of money managers who had apple at a significant overweight. i agree with all the comments here, and i think the question becomes when does apple move back to an overweight status once again? if it goes down to 105, everyone in the world is going to tell you it's a buy down here. it's phenomenal. you're not worried about the down slide. you're worried about when momentum is going to reaccelerate. it might not happen today. it might happen in the next quarter. it will happen once again. history has shown that it will. if it doesn't happen today, what's the option activity telling us about what could happen after the bell?
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>> all right. well, first of all, it's pricing at about a 6% move between today and friday. that's what's pricing in what the straddle basically had the numbers we looked at just before the show. to your point, scott, about why is apple under performing versus, for instance, amazon, take a look at amazon over the same period last year. >> amazon flat as a board. in other words, this year apple is the one that's flat, and now you've got the outperformance potentially starting to kick in after you get past this very tough comp. as josh said, when you are looking at 78 million handsets, and if you don't get that, oh, my god, run around and sell everything. that's the wrong way to think. john kerry is exactly right. that is exactly right. you don't want to do that. if it dips here, judge, i would want to be an aggressive buyer. here are two smart trades really quickly. one, somebody stepped in, bought 40,000 of the november 125
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calls, and sold 40,000 of the 126 calls. that's only a $1 call spread. the thing is they put just 20 cents on the table. they could have five times. in other words, that could go to i buck if apple does trade out between now and november. in other words, they're dismissing the earnings today a little bit, and they're saying let's get by that some of the noise, and go out to where we think it's going to be a month from now. that's what they are -- i'm sorry. into november expiration two weeks from now. that's what they're doing. i think that's a smart play. aufrlly big return versus the amount of money invested. >> let's bring in a top ranked apple analyst on the street. tony is a senior analyst at an ford bernstein. he is the number one hardware analyst. welcome back. >> why hasn't the stock performed better? >> in the last 12 months apple has grown at about 30%.
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if we look forward apple is expected only to grow its top line single digits. you compare that to alphabet and amazon who are growing strong double digits. the fear is that apple is entering growth perringtory. it had the great blast cycle with the iphone six. >> the worry is apple won't really grow. it deserves a lower multiple relative to those other names. >> the law of large numbers does kick in. the real question about apple is
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can the iphone grow for two or three more years or is it largely done growing. >> it's unlikely it's really going to grow much going forward. it's such a large revenue base that it's difficult to make it up. the car would kick in and drive material revenues or that the walk would ultimately be something very big. can there really be iphone growth? absent that there's not going to be much growth from appear. >> i got a quick one. give me the answer to this. was it an overread yesterday on dialogue semi for apple to drop 3% based upon that almost exclusively? >> well, look. you've had a very jittery market. apple is traded in this range
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between 108 and 120 over the last month, and it's really been susceptible to data points. i mean, quite frankly, the noise in apple is extraordinary on a daily basis. whether it be market research data, whether it be, you know, whispers of what orders from suppliers might be, whether it be dialogue yesterday, so it is amading how much, you know, market cap moves around. i mean, yesterday i think if do you the math, you know, it was $20 billion of market cap erased from the one data point. i think a lot of the noise is very spurrious. that really reflects genuine investor, you know, uneasiness and -- about which direction the stock was in. >> an overweight or outperform weighting on this name, you sound like somebody who is asking yours in some respects whether apple's best days are,
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in fact, behind it. >> i think it's a different kind of company. the best days are behind it. it's not going to be growing at 20% to 70% going forward, but its valuation was showing that. the x cash it's trading at seven and a half times free cash flow. what that means effectively is that the street is discounting that apple's free cash flow will decline in per pet out at 5% per year. that just seems overly pessimistic to me. i think apple will likely be a moderate grower over the next three or four years. likely top line in a single digit and eps probably in the high single digits given its buybacks. it's not going to return to the strong double digit growth we had before. the law of large numbers doesn't permit that. huh so much.
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toiny of bernstein. the number one ranked analyst four years running. what do you make of his comments? best days are behind it. that's what he said. >> best days based on what? based on growth rate? obviously. by definition. i don't think we're breaking news by saying trees don't grow to the sky. at a certain point you get to a certain size, and you can't grow 30%, 40%, 50%. apple is about more than just this growth rate. again, this is a cash to shareholders story. it's been for a while now. those are great stocks to own. if you look historically some of the most successful investors throughout history have gotten that way because they held on to companies that continued to shrink the float and pay out huge dividends, and apple has the ability to do that for as far as the eye can see. >> i think you really want to focus on growth stocks within technology. i've always had a barbell.
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>> think that there are other ways to play technology at this point. not to say apple is bad. i just think there are other ways to play. >> i think, again, the real concern tonight is the apple suppliers because a real miss for apple. what is it that mean for a qualcomm or most importantly, for me, sky works solution. sky works solution does the deal with pmc sierra to diversify its business model. why? what is it they see going forward? they don't see the growth in apple that they've seen over the last couple of years.
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>> when this thing turns, it's going to be a nasty reversal that no one is ready for. e there's a lot of room for the up side if they can continue to execute. >> they did execute. find out if he is sticking with the stock after the company's latest sales surge. pete will reveal what is he buying and selling what got him off the fence finally. first in business worldwide. [ male announcer ] whether it takes 200,000 parts,
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we are back. i just want to point out shares of apple here which did move into negative territory on the heels of that appearance just now. out by bernstein's tony -- is he the number one ranked i.t. hardware analyst for 14 years running with a rather sobering view of what apple's growth prospects are going forward. relative to where they were. saying the company's best days, in fact, are behind him. moving the stock perhaps on those comments now into negative territory ahead of those highly anticipated earnings after the closing bell. speaking of earnings, alibaba beat expectations and mobile revenue is more than double. what's your trade now on this name? >> search for baba. >> i'm on the name, and initially i look like a clown, but that's what happens sometimes when you buy a stock
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that's been cut in half. it ask still go down further. now i'm in the green, and i'm still in the name. if i were just judging by what they said in their report, i would be very happy. this is a company that 183% growth in mobile revenues up 32% overall. the gross merchandise value, which is the key stat that analysts would cover the company watch because it's a platform for sales were up 30% also. there really weren't any negatives here in the quarter. i think a lot of what's gone on with the stock, though, scott is sent meant driven. people looked at it as a proxy for the consumer, and when you had the shaenk high melt down this spring, people said, oh, no, this is going to be trouble for alibaba. turns out, not the case. that might be another catalyst. should smash every record on the books. for the time being i'm still in the name. i'm happy with what i heard on the stock. >> pete. any interest in the name? we're trying to put together a debate, and it's hard to get one
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together with you guys. it's frankly hard to find people who are either totally negative or that bullish behind josh. >> i think they also don't want to go up against me, though, is the factor here. >> also, lee look at where the stock was today. this stock opened, and it was well towards the mid 08s, and now here we are back below 80. it does say it something, scott. they had a big move, and it we want down to 59. now it's up in the mid 80s. had he start selling it. people taking profits off the table. great numbers as josh points out. i think the read through for me so far has been how did nike do and how did they do in china when there's nothing go on in china, and meanwhile, their sales are up the way they were. now you get the alibaba news. this ties into how is apple doing over in china right now? so many people are saying, wow, there's no way they are going to be doing anything. >> the numbers in china are going to be good. >> are they good or great? nike numbers were great. these baba numbers were pretty cool. >> i think the risk is to the great side. >> right. >> if you listen to blackstone on the strength of their mall
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business in china, if you listen to nike on the strength of its business in china -- >> listen to tim cook. >> they said there's been no slowdown, that it's bin strong. i think the risk is to the great side. >> well, so you don't have the wealth effect in china that you have in the u.s. if we have a stock market that tumbles 30% in a couple of months, you will absolutely see that show up in retail numbers eventually. china is not quite the same story. the market is not as institutionalizeded, and they do not have that same wealth effect. we should not be a shock that alibaba kept on ticking. >> i have been skeptical on baba. i would have been willing to play the bear against josh today. the problem is the mobile numbers. that mobile number is incredibly staggering, and it's what twitter has not been able to do. the ability to post the number like that from the short side. that's got to scare you. >> kate kelly joins us now with the very latest. kate, i think you've seen his
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most recent investor letter. >> i have. just out, scott. >> glenview struggling somewhat this month. this year overall. last we're they were up 14.5% or so. this year, however, through the close yesterday they were down over 20%. that's obviously not good. in an apologetic letter to investors, robin sort of lays out his market view. it's interesting. he talks about what went wrong in the last 60 to 90 days. he says the august eyeragses in the market he thought were systemic rather than rotational. it's a rock bed of strength. now in retrospect that view seems like hubris, but he nevertheless makes the case as to why the holdings they have are still relatively low risk. this is managed care, hospitals, pharmaceuticals, among other health care names. you know, he kind of talks about what some of the continued advantages are of being in
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health care names like that. he says relative to global equities, it's low risk. it's low risk compared to cyclical risks that we see as well. he thinks the solid earnings growth of health care compared to the market is also a continuing attractive characteristic. he detailed some of his views on specific health care holdings that his fund has and the sectors that they're in. he also spent time on valeant even though he is not in the stock and says he doesn't plan to be. he notes while they have no position to the best of their current knowledge, valeant is guilty of what looks to be poor judgment in historical price increases on akwishd products, but they do not appear to be a fraud lent enterprise. making its share price a gamble on sentiment rather than a long or short investment. now he also spends a little bit of time on abvi, which is the biggest holding and the subject of the ill-timed grenade in the form of a negative notice from the fda last week on a hepatitis c drug that really tanked the stock.
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still says robins, it's not material to the fund's long-term thesis, and he is optimistic, so the, about the future of the entire portfolio. it sounds like he is about abvi as well. >> good to hear somebody with significant skin in the game, kate. >> earnings sent the stock on the comeback trail. when a moment turns romantic why pause to take a pill? or stop to find a bathroom? cialis for daily use is approved to treat both erectile dysfunction and the urinary symptoms of bph, like needing to go frequently, day or night. tell your doctor about all your medical conditions and medicines, and ask if your heart is healthy enough for sex. do not take cialis if you take nitrates for chest pain,
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bob dylan. to improve my language skills, i've read all of your lyrics. you've read all of my lyrics? i can read 800 million pages per second. that's fast. my analysis shows your major themes are that time passes. and love fades. that sounds about right. i have never known love. maybe we should write a song together. i can sing. you can sing? do be bop. be bop do. do be do be do. do do do be do.
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welcome wack to the halftime report. dow transportation stocks are trading lower. down by more than 2.5%. their lowest level so far today. all 20 members of that index are in negative territory. jetblue is the biggest decliner so far today. down by over 7% as the airline company warned that passenger unit revenues will drop 2% in october. now, ups also in focus here. trading 3% lower after reporting a revenue miss, and that stock has the biggest weight on that
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particular industry group, and lastly, railroad stocks like union pacific, kansas city, southern csx also dragging those transportation stocks lower. oun down to 3%, 4%. a rough day for these stocks, scott, despite the fact that in some ways oil has hit a multi-month low. >> thank you. a lift in the transports because oil keeps falling. >> not happening. >> too much bad news today with jetblue, ups, the durable goods numbers across the board. these stocks all rallied hard off the lows. i think it's a good opportunity off the rails. i'm a big fan of that one. actually, they did a really good job in controlling their cost structure while the volumes have been low. >> also the airlines they've had a nice run delta. it concerns me from an overall
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market perspective. with oil moving lower and oil doesn't look good right now, that's for sure. oil was unable to sustain above $50. i thought it was. i got that one wrong. it's rolled back over. energy prices now are having the negative impact of warmer weather. energy does not look good right now. you think you would get a positive impact about the -- the bullish view of where you think we would go. >> i am not today as bullish as i have been over the last three weeks. i think this is lining up much similar to 2011. i any 2011 you had that september, october rally. you stalled out november. yes, i think the up side here is limited. i would be concerned going into november. i think the market could pull back. >> isn't it seasonal? isn't the oil business? this is the period of the we're where you have kind of a lot of capacity that's building up and -- >> you are talking seasonal energy. lately the seasonal energy
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trade -- >> transports have been awful and below their 200 day. pretty much most of the year and they line up actually directly with the russell which is also awful. you don't have transports or smallcaps. that's why it's been so difficult for people to get bullish here even though the major averages are so close to all-time highs. >> real quick, though, the airlines rocketing, and they have barely even moved off of yesterday's highs. delta, unite, american. keep that in mind as well. there's only one getting hit hard today, and that's jetblue. >> i want to go deeper into the oil trade. the nymex at the futures. crude, where could it go next? >> we're watching crude oil futures trading under that critical mark right now. it's the price. i'm seeing a two-month low. continued supply-demand worries here. brian, the case has been made
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that we should go lower from here. having said that, oil has been volatile. how do you trade it? >> oil has been volatile. it's starting to pick up again. we had this nice trading range of 44.50 for $50. we saw the volatility index on deeper decline. oil volatility index prints 45. that means there's fear building and people are buying options in the oil market rather than owning the crude market. that's fire, some disconnect there that could take oil lower and certainly the picture as you mentioned, auz heard everybody talking about. not good. they're trucking out and looking at the demand picture there. not good globally. certainly demand deteriorating. that could head oil lower. >> i think we do break 40. supplies absolutely huge. we learned last week when you were on vacation probably sipping something on the beach, that the producers aren't going to throttle back on their supply. we're back below that wedge at 45, 50 that we talked about last
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month. that's all continuing to drive crude lower. 40 is the next nice round number, but below that about 12% below where we're at right now, the number that stands out is 37.75 because that's the low from august. >> okay. we'll be watching that closely. meantime, we're going to talk more energy on the on-line show. we have andy lipow, an oil expert to break it down for us as well as the next move for stocks. we have oppenheimer's jerry webman. >> the two-month high where are commodities fall again on the fears over global growth. the u.k. reporting slower growth with construction sinking by 2.2%. importantly, of course, making a near-term rise in british interest rates less likely.
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a pronounced summer lull in volume momentum as brazil and china weigh, and losses built through the sessions as metals and oil fell. mining stocks and energy even bp turning negative despite beating earnings expectations earlier. the third round of spending cuts and still more asset sales. altise still managing to trade in positive territory. the french billionaire persuading private equity player bc partners and the canada penning board to share the cost of his $18 billion acquisition of cable activision. those two are taking a 30% stake. very similar stock to the deal that they did when draghi bought southern link over in st. louis. back to you. >> thank you, so much, simon hobbs with the latest on the european close. seeing green. jane wells on the pot boom in colorado, and the politics of
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legalized marijuana. that's ahead of cnbc's republican presidential debate. plus, pete, there he is. >> oh, nice. >> bracing to catch up in our halftime portfolio challenge. what he is buying and selling and whether he can indeed sprint up our leaderboard. >> a couple of hurleds in front of him. opportunities aren't always obvious. sometimes they just drop in. cme group can help you navigate risks and capture opportunities. we enable you to reach global markets and drive forward with broader possibilities. cme group: how the world advances.
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♪ your ticket to a better night's sleep ♪ hello. i'm sue herrera. here is your cnbc news update for this hour. saudi arabia releasing video of an air strike on a supply boat bringing weapons and equipment to rebel forces in yemen. the video shows small boats approaching a larger vessel off the coast which it says were bringing weapons ashore. fiat chrysler is recalling some jeep cherokees and suvs and ram pickup trucks for two different safety issues. 94,0002015 jeep cherokees are being recalled due to an air conditioning problem. 4,000 ram pickup trucks from 2015 and 2016 have defective rear axle shafts. outdoor gear and sporting goods retailer rei co-op is cancelling black friday this year. no promotions. no hourly sales.
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no waiting in line. the store is closing the day after thanksgiving to encourage people to spend time outside instead. which is its motto. you can call this a trump-kin. ohio artist jeanette paris creating a 374 pound -- that's just leg -- donald trump pumpkin. paris has been carving pumpkins for more than 25 years. her creations include presidents, politicians, entertainers, and athletes. she actually got the hair right. that's the cnbc news update at this hour. back to you, scottie. >> i let really was thinking the same exact them. got the comb-over. that's the key. >> i don't know what that is. >> i don't know. it could be the shredded parts of the inside of the pumpkin. i don't know. maybe she can e-mail us and let us know. there you go. >> biggest question on wall street remains. when will the fed raise rates? our senior economics reporter steve liesman here with the
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exclusive results from the latest cnbc fed survey. steve, at the wall. >> thanks. what you see when we look at the results of the sur ray is that everything has been pushed back and there's yet still a big division over when things happen. first, let's look at the fed's timeline here. here's the prior survey from september of 2015. rate hike in september. balance sheet decline. august 2016. the terminal rate or the end of the rate hike cycle being hit in the first quarter of 2018. forget all that. everything has been pushed back. the new rate hike december 2015. the new balance sheet declined pushed that ahead and pushed it back to november 2015. there's the terminal rate. two quarters later. sdmrool deep division on wall street whether the fed hike this is year or next. 20 or half of our 41 respondents who include economist, fund managers and analysts. they think it's still happening
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in december 2015. look at the rest. if you add up all those, that's another 19 respondents. they push it ahead january 2016. scott, lower for longer is in the cards here. there's still a lot of the debate over whether or not it can happen this year, scott. >> steve, thanks so much. bring cnbc contributor joe now and what do you think of the results? does it jive with what you are thinking? >> lower for longer for sure. they're going to wait nine plus years and move in a month -- holiday shopping season. -- >> they're only doing it to meet some kind of calendar pledge. i don't see happening in december. i think march at the earliest. they may not go at all next year. >> the economiest along with liesman. the hands for a u.s. presession
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are now what percent? >> 15%. the economy is going to do okay. >> the problem is it's okay. we're in the seventh year. our best year for growth was 2010, and we were 2-7 year on year. >> sue herrera, you have breaking news on some possible m&a. >> the drugstore space, scottie, specifically walgreens is near a deal apparently to buy right aide according to sources quoteded by dow jones. the walgreens wythe right aid deal could be announced as soon as wednesday according to the sources. consolidation continues in this stwik space. walgreens as you can see and walgreens and boots. they baltimore boots a couple of years ago. it's up 4.75%. right aide has halted for volatility. we can see the move 5.75. walgreens boots is near and dear to rite aid.
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it could be announced as soon as wednesday. scott, back to you. >> thanks. >> a new ceo at walgreens. he has been cutting costs like crazy. he has not made it a secret that he wants to make it a deal. we all thought he was going to actually go after express scripts, the pbm. he is awful, and now they're going after rite aid, which is a turnaround story in itself. having a challenging time trying to compete with the likes of a wall greens and a cvs. makes a lot of sense. you can see why express scripts is down. >> does this have an implication for the drug pricing issues that seem to be hanging over the sector in swren? >> certainly generics are having a big issue for the drug companies for sure. drugstore companies. >> it's one less -- >> different scale for sure. >> rite aid lost nearly 30% of its value in the last two weeks of september, and there's a great example in terms of shorting a stock, short interest rose dramatically thinking it was going to break low $5 there's a great example of how
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it just does not work. >> back to our conversation on cnbc's fed survey. liesman, can you have a manufacturing recession and not have a full blown recession is this. >> you can. we've seen that before. we've had profit recessions and manufacturing recessions. the question is how long the manufacturing sector is going through. how long it lasts. two particular factors seem to be hurting the manufacturing industry right now. manufacturing sector right now. the first is the decline in oil and gas. it had a bad effect on manufacturing. the other is the stronger dollar. that stuff washes out after a while if it doesn't keep going down. >> the last quo when the fed could move and another key point from your survey is that your participants don't think that it's priced into the market if they go this year. >> that goes right along. >> a bunch of folks have said it's not happening this year. now it's out of the stock market. if you look at the latest results, we see about one-third of folk that think it's not priced in. 60% or so say it's not
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discounted. what that tells you is if they do go this year, it is not priced in. what i can't tell you, scott, because of the fickle market is i don't know what the stock market wants. if you had a quarter point hike, you could just as surely see a rally as you could see a sell-off. it doesn't seem to be in the market. >> if we don't already know, they probably won't go. that's what you coined the last time. >> that was before the meeting. >> my best johnnie cochran, right. if the glove don't fit. if we don't know, they won't go. when we go into a meeting, it will be clear to everyone. for example, two soltd jobs reports. thanks. two solid jobs reports would bring us back to a decision. >> last point, joe. >> the point is steve makes a good point about recessions and manufacturing. the last most comparable period was probably asia in 1997, 1998. relatively well according to rest of the world.
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>> we have the ability of rates to rally. they fell almost 300 basis points. >> steve, thank you. i just want to show you before we go to break, more activity in walgreens and rite aid. the strongs reopened, and can you see a huge jump in shares of rad. that being rite aid on this report that walgreens boots alliance. >> guys were buying the seventh strike calls for 10 cents and 12 cents. thousands. >> over what period. >> just in the last two weeks. buying eight calls. thousands. 10,000 of those trading. people expected rite aid to come up with something. here it is. >> pete finally makes some trades in his halftime portfolio. ♪
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>> we're happy. the names he is buying and selling is next. you are watching cnbc, first in business worldwide. here at td ameritrade, they love innovating. and apparently, they also love stickers. what's up with these things, victor? we decided to give ourselves stickers for each feature we release. we read about 10,000 suggestions a week to create features that as traders we'd want to use, like social signals, a tool that uses social media to help with research. 10,000 suggestions. who reads all those?
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he does. for all the confidence you need. td ameritrade. you got this.
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coming up at the top of the hour on power lumpl, check out the nasdaq 100. just a handful of stocks, actually, fueling the gains. natural gas prices sinking to new lows. down 25% this year. one of the big players. duke energy. striking a major deal in the space this week. paying a hefty price. duke energy ceo joining us in a cnbc exclusive. >> new forecast out for the holiday shopping season. retail stocks that could be big winners this year and, of course, all over that developing story. reports that walgreens could tie up a potential deal with rite aid. back to you, scott. >> sarah, i want to show you what shares are doing. up more than 40%. up nearly 40% on this report.
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rite aid are near a deal. could be as valued as much as $10 billion akrgtd to dow jones. you want to give me wurch more comment on the desk here about what you think? >> we were just talking, steph with that, walgreens and they are balance sheet. how rich is the deal going to be. stephanie pointed out to me, that's a deal that they're going to have to lever up on. they don't have the cash. >> college out cvs. shot up as soon as the news was reported. it was interesting. you expect the opposite reaction. >> you'll have to sell off stores. that's my favorite name in the group. vcs. >> it's an interesting move if i recall correctly. i think swrana, barry rosenstein's firm, they have two seats on the walgreens board. it's just an interesting development given their placement in that company for at least a year, i believe. the role that activism has played in getting walgreens to
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do a deal like this if, in fact, it is consequence mate thered. that's what you got. a deal could be worth if wall geenz, in fact, does buy. rite shares up -- cvs on the move. all drug stores moving on this potential deal news. he broke down and finally made some trades. >> there was a few folks with great ideas, as a matter of fact. >> did you take any of them? >> i mean, i looked at them. i thought about them sfwloosh what did do you? >> american express has been an absolute dog the entire year, and continues to be a dog and so i finally, you know, have gotten some encouragement for a few folks as some of our guest, of course as a matter of fact, your guest coming friday. it was one of many. it's just not done anything. they don't do anything. because of that i finally decided dump that. i look at that one, and i decide
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i want to get a little bang for my buck. i love what under armor reported recently. when you look at that report, yes, the margins did come in. this is a company that still is expand and had he still have incredible gross revenues when you look at the revenues. there was a record$1.2 billion they were able to report. and then when you look at what they're doing in the direct marketing world, that's where they're absolutely crushing it. stock actually went from over 100 down to the low 9 o's. here i decided to pick some of that up. i personally bought it friday and bought it for the portfolio this morning. >> did you get jetblue today or after? >> i waited for that one today. i was looking at another one that i'm not very happy about which is ups. ups is one of my stocks. it's come back significantly from where it was. actually the real hang on my entire portfolio really has been american express. but u.p.s. had been hit as well. it made it back yesterday. trading $106. today it was $103.50 and then i jum noopd jetblue. i think the jetblue story is way
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oversold. i lot of big three. i'm in two of the big three presently. have been in mostst name the entire year. i think going from 27 and now today down 7%, i think we got it right around 24 and small change. >> i like the moves, pete. i think underarmor will be strong for you going into the holiday season. there is probably not a kid in america not getting something from underarmor from the tree or menorah or whatever they celebrate. >> the stage is set for cnbc's republican presidential debate in colorado. jane wells on why the economy there is in the weeds. literally. jane? >> well, and in the weeds right now, scott, is ralphy. ralphy the mascot for the university of colorado. we're outside coors event sent wrer debate prepz are going on inside. and up next, what the gurus of boulder have to say to the candidates when we come back.
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it's the fastest growing part of the colorado economy, pot. $700 million industry last year alone. and as the republican hopefuls prepare for cnbc's debate tomorrow night, jane wells is live in boulder on where the candidates come down on the issue of legalized marijuana.
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hi, jane. >> hi, scott. i'm outside the coors veevent st wrer the debate will take place. this is business field. there is the designated free speech area for protesters tomorrow. you might find it ironic that protesters will meet on business field. the biggest business in colorado now is pot. gop candidates have not expressed much support for it. rand paul says he sports states rights. that's the closest things. that gives pot entrepreneurs pause. >> it is a lot like the gold rush. remembering that the gold rush a lot of people froze to death. just the whole fact that we have this conflict of laws, federal laws, we don't know who our next president is going to be f it's chris christie, he seems to think that he's going to shut all of us down if he becomes president. the critics who said that legalization would destroy the economy this is what they said, they said it would open up the gates of hell is one i heard recently, they've been wronged. >> and by the way, guys, the
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next thing they'd like to do is grow hemp. they think that is really the next big cash crop. but hemp, like marijuana, you can't grow it in the united states legally on a federal level. back to you. >> all right. jane wells, thank you so much. the big vent happening tomorrow night right here on cnbc. the republican presidential candidates gearing up to debate. cnbc will be live at the university of colorado boulder. coverage starting at 5:00 p.m. eastern time. pretty big earnings to day after the bell. josh, twitter? >> yeah, so five cents, $559 million in revenue. that is a 55% jump. this is jack's chance to talk about all the new products they've been rolling out, what's coming in the hopper. and convince the street that this platform can actual ll lly monetize. >> twitter. we heard from pfizer and merck and bristol-myers, all awesome. all to the up side. i added some options in there. i took those off.
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i think gilead does well as well tonight. >> gilead, twitter, april snl. >> i agree. gilead. gilead is the best one. >> i don't think twitter matters on the numbers. i think people are going to give them a pass on the management team. gilead, m & a, we'll hear about. that thanks for watching. "power" begins now. >> thanks very much. we appreciate you joining us here for "power lunch". mandy is off today. say sar sarah eisen joining me in just a moment. talks now of a merger that would bring together the nation's second and third largest drug chains. a massive recall from general motors. more than a million cars affected m have been recalled before. check out the nasdaq 100. a percentage point


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