Skip to main content

tv   Fast Money Halftime Report  CNBC  April 6, 2016 12:00pm-1:01pm EDT

12:00 pm
>> this is what the president mentioned. it was the equivalent of a swiss bank account in your pocket. but we're moving in that direction. >> overall a market being supported by oil and what was the biggest draw down for this week of the year since at least 97. our thanks to them. the half begins now. >> welcome to the halftime report. our top trade this hour, the board room drama inside one of this country's largest home builders. the ceo is being told to pack up and get out by the company's 85-year-old founder. his grandson and a soon to be former board member. he is in the middle of it all today and joins me now in a cnbc exclusive interview. he's live with us today from chicago. welcome. >> good to see you. >> you and your grandfather say you want him to leave now.
12:01 pm
he says he will leave by 2017. why should he go now. first of all we're very happy we'll talk about the facts in a second and i want to reassure investors that the family is a big fan of conservative land investment. we want to be disciplined and we don't want to go back to the big land buying days. there's been sames made about how we want to change a big directionment we just juan a new leader so let me just say that about the conservative smart growth that our family wants and reensure investors that we want that. but let me tell you scott. richard has been a family friend of the family. we didn't bother him for the last several years but from 2004 to 2015 on acumulative basis the pretax earnings of the business have been a loss of over $400 million and that's very concerning for us. additionally over the last two years the stock prices stayed
12:02 pm
stagnant and it's time to go and we're very hopeful that he goes before next year. >> the board says your campaign is, quote, misguided and not in the interest of shareholders. the board would also point out since he initiated that value creation strategy of his back in 2011 that shareholder gains have been out pacing competitors. since 2011 until now, the stock up 142%. 140 for lenar. kb is 7%. some other home builders have done quite well. but what's done with those numbers. >> the gentlemen that made those statements happen to come from syntex was which a failed acquisition. and he's still a director and much less the lead director of the organization. he road off within two years a billion and a half dollars as a result of that deal. so there's a whole lot of missed opportunities. many say syntex was going to go
12:03 pm
bank rupt but the other builders lost a lot more money in the next several years. >> what are you talking about and referring to in this letter that your grandfather sent to the board of directors? >> we have seen an enormous amount offal lenned concern. and he knows how to build this business and the amazing thing is he decided to make this subject. we were working with them privately. monday morning we were blind sided by this announcement. we replaced over years over ten ceos. this is nothing new for us. we would prefer not to have this public battle but in the interest of the employees that we care a lot about. we do not want to replace the senior management team.
12:04 pm
we just want to make a change in ceo and have the family values that made this a great company be a great company again. >> mr. postal that you referred to already, he is the lead director at pulte and gave me an on the record comment i'd like to read now and i'll quote and get your reaction from it. personal venn deat as are a smoke screen for what's really at stake here. the successful value creation strategy that has driven pulte group forward over the last five years. it appears that the pulte family wants to drag if business back to the old path which can expose the company to excessive risks when the housing cycles turn down. the board will not allow this. he lead the execution of a well defined strategy that can enhance performance through housing cycles and the board is committed to seeing it through. we're thrilled that richard will be our ceo for another year to help make that happen. what's your reaction to all of
12:05 pm
that? >> number one, jim has been with richard since the failed deal and that's important to remember but the family does not want to go back to the old model. we used to have a value creation model but a return on invested capital model. we're all about making smart land decisions. in fact, in 2003 the company went on a land buying spree and we learned the hard lessons that we learned over the last several decade which is is you don want to overinvest in land. you want to be smart so this whole play that we juan to stop being smart and many of the things that the company is doing are great. whether they want to call it value creation that's fine but there's a lot of missed opportunities that are happening and his background is not from the ground up in the field and we firmly believe that a seasoned operator, somebody that really understands the home building industry and with all due respect, didn't come from pepsi but somebody that understands home building would be a great ceo for the business
12:06 pm
and given the execution risks apparent this year we're hoping that a new ceo comes in in the next few months for the benefit of shareholders. i don't see any reason why he would want to stay until 2017 unless for his own personal wishes but that's just my belief. >> they would probably make the argument that whatever he has instituted since 2011 seems to, in fact, be working. significant gains in pretax income. a significant decrease in the debt to capital ratio. instituting a buy back. things that most people view as being shareholder friendly. >> scott, where is the stock price gone in the last two or three years? you know? the record speaks for itself. the stock hasn't gone, in fact, a few years ago it was trading at $21 a share. so the stock prices stayed relatively flat and under richard's leadership we don see it getting to where we need it to be. we think the company is doing great things. we love the employees.
12:07 pm
some of the senior management team we think very highly of. ryan marshall could be potential ceo one day. fantastic guy. harmon smith he's been in the business for a long time. these guys are running the business every day. this is a good fundamental business. strong assets, strong name. we just need a new ceo for a brighter day. >> what do you do if he just refuses to leave? sources that i have been speaking to and those that diana spoke with and already reported on the air less than an hour ago said that he has no plans to leave earlier. my reporting would say he has 100% backing of the board. so what do you do? >> well, you know, i really hope for the shareholders and for the employees does he really want to be the center of attention in this company going forward. we met with him privately. i told richard the last thing we want to do is bring this public? what did the board do ohri chard do? they went public on this.
12:08 pm
nothing can come constructive from this. richard has made over 100 million dollar while the stock price has not dramatically increased. he's made a lot of money. it's time for him to go. >> some may suggest that maybe they had no choice in james grossfeld who we are looking at on the screen is one of the board members. he is now an outgoing board member because he will not stand for re-election on the board's juaning. if he was internally helping to lead an upheaval why should he remain on the board? >> he told him he did not want him to re-sign. that was the intention of my grandfather and as far as the board is concerned jim was very independent. let me tell you a little bit about jim. he's the third largest shareholder in black rock.
12:09 pm
he ran pulte from 1974 to 1990. he's a super star by every stretch of the imagination. he has more talent in the home building industry and i mean that respectfully to the rest of the board than anybody on the board. why logically why would the board get rid of somebody with theal len and expertise of mr. grosfeld? it's inconceivable. he was acting great and working very constructively with us. we would love to meet with the company private. i meet with them today but they have to be willing to hear our concerns. we're the largest shareholder and we're not going away. we think it's a great buying opportunity. >> do you want to be the ceo? >> absolutely not. from a little kid i said i have
12:10 pm
no interest in home building. i have a hard enough time escaping the name bill pulte. i have a great business. i care a lot about my grandfather and family name and when i see these people leaving the company and when i see this great home building town my grandfather worked for so many years to create go away we have to say we have to do something and this idea that one gentleman would have to stay around to sacrifice that is not in the best interest of the shareholders. >> you have taken issue with the fact that he moved the company from detroit to atlanta. why is that such a big point of contention? >> well, the company lost a lot of money in the years up to that. it's not apparent to us why that move occurred. he was laid off as part of the move. there are countless stories of
12:11 pm
that and in addition to the tens of millions of dollars on the move there's a significant loss of talent and we're very concerned that we believe him to be reckless management style by doing that cost the company and is still costing the company. the gentlemen i mentioned also had to do with quality and helped with litigation around quality and he was a very valuable person. those are the decisions that after a certain period of time we've had enough. >> was the family supportive of the move at least initially? it was announced or maybe approved by the board? 13? was the pulte family initially in support of that move? >> i would tell you that the board actually did not vote according to some releases the board did not actually vote on that. mr. dugas said he spear headed the move. in a statement yesterday they said it was spear headed by the board. so we're not exactly sure what
12:12 pm
had gone on there but the family was obviously disappointed because it became the largest home builder in the state of michigan so one would argue okay we have gone from being the number one home builder to in this case number three or number four so why would somebody lay off people and tens of millions of dollars. but my grandfather's opinion was take a motion out of this. and ended up moving the company and the reality is we don't think that we have seen the proof in the pudding. tens of millions of dollars has been spent and a lot of great peel were laid off. but again the atlanta move is one indication of the many points that i made. >> sure. if not you, if not dugas then
12:13 pm
who? who should be running pulte homes and the pulte group from here forward? >> two gentlemen. ryan marshall should be one. he's an executive fantastic guy in charge of many divisions at pulte. also harmon smith would be a great candidate. and when mr. grosfeld went off the board it because he had been in the industry for a long period of time. this board has not had a lot of experience in home building and that's why it's a big shame to see him go and i would strongly encourage them to add him back. that's just a shame. >> what have other large shareholders told you about your attempts if you even had those conversations to this point. >> i can't talk about that but
12:14 pm
some of the biggest names in the housing industry smart, smart people called us and said con fwraj lagss. one of them even said now you're going to be a real competitor and i can tell you that i can't talk about the specifics but we're confident that if and when we need to tell the whole story we'll do it but we would like to work constructively with you. we would like to find a solution. we don't want to engage in the public nonsense. >> thank you for your time today. appreciate it very much. >> thank you, scott. have a great day. >> bill pulte the grand son of the founder of the pulte group attempting a board room upheaval at that company. third largest home builder. >> but he tried to do it, based on what we heard from him, that it was the company and or mr. dugas that decided to splash this all over the news.
12:15 pm
the news wires and so forth that's not positive for the company. and especially if it's basically a reach out by both pultes and the grandfathers and bill to say let's negotiate here and talk about this and instead he takes it public and that's the long way to go. >> we're going to take a quick break and react to this story on the other side and here's what else is coming up on the halftime report. >> still ahead, the apple of her eye. >> i feel like apple stock has been dramatically undervalued. >> why one analyst says that stock is heading to $150. plus the biggest health care deal of all time is officially dead. so what should you do now? and energy stocks are topping the tape today. how you should be playing crude's rally. it's all coming up on the halftime report. eese, "day to feel alive"♪
12:16 pm
♪jake reese, "day to feel alive"♪ ♪jake reese, "day to feel alive"♪
12:17 pm
i'm a customer relationship i'm roy gmanager.ith pg&e. anderson valley brewing company is definitely a leader in the adoption of energy efficiency.
12:18 pm
pg&e is a strong supporter of solar energy. we focus on helping our customers understand it and be able to apply it in the best way possible. not only is it good for the environment, it's good for the businesses' bottom line. these are our neighbors. these are the people that we work with. that matters to me. i have three children that are going to grow up here and i want them to be able to enjoy all the things that i was able to enjoy. together, we're building a better california.
12:19 pm
>> i think one of the things that people aren't realizing in the story is that obviously pulte is more land and single family housing, right? that's not the sweet spot right now. for him to do what he did with the stock the last year or so he did a lot of financial engineering to get this company situated for the demographic on
12:20 pm
slot that's going to happen very quickly as people get fed up paying $4,500 in rent for a one and two bedroom apartment and say i'm going to get married and have a family and have kids. >> i'm going to disagree because still houses are not that affordable. >> very affordable compared to rent. >> we can debate that all day. >> you show me charts on affordability but it's can you get the financing. >> banks. >> it's the question they may be cheaper but it's like a rolls royce. >> it's a demographic thing. >> i'm telling you. >> get married. have children. buy homes and they're not going to want to be in an apartment. and he's lending you money. >> banks are lending money if you have obviously down payment. >> he's in the sweet spot.
12:21 pm
>> we were talking about it pivoted toward apartments. see him on jersey city. and you don't have to worry about the finances. rental properties. >> you can actually afford a million dollar home. first of all. second of all, the banks. that's a dodd frank issue and eventually the credit is going to ease up mortgage rates 3.4%. and let's move apple. let's talk about that stock. initiated with a strong buy today. a $150 price target as well. a tech giant is a safe haven. it's the analyst behind the call. it's our call of the day. welcome. >> nice to see you. why is it time for a strong buy. >> if you think you took it off of it and laid it against the walt disney company apple had
12:22 pm
higher margins for the last five years and if you took that hardware label off it would be valued at $200. we think that's the long-term value of apple. there was a note that came out yesterday or the day before from another analyst that cited the services business is going to be the big driver. what gets apple to where you think it can go. >> i think the big call here is that the consumer is replacing his wires in the ground with a global mobile footprint and apple has a dominant position in the wealthiest aspect of that. has 16% of the global smartphone market and the android price of hardware is about $300. apple's average price is about 700 of which we think 300 is the hardware and 400 is the subscription revenue stream you buy your way into the ecosystem with. better apps, better service in the stores.
12:23 pm
seemless integration and ease of use. it's an 8 year average hold of a smartphone ecosystem meaning if you're in apple you stay there 8 years. that feels like a subscription business to me just like the cable companies. >> i don't disagree but i have a quick question as well. what do you see going forward that gets you the most excited about apple. not just the eco system itself but is there something that you're seeing that you think could be the next big driver for apple? >> i really like the apple pay business and this focus on cars and other services that increase the annuity stream business with apple and increase the revenue per their billion active devices today. >> you haven't covered apple since 2014. is that right? >> that was the predecessor analyst. needham hasn't. that's correct. >> you have a hold on disney is that right?
12:24 pm
>> i do. >> weigh in on this new drama now that we're faced to deal with with him no longer the heir apparent? >> i think board put shareholders in a position of having to pray every night that nothing bad happens to bob iger. that $160 billion company doesn't have a succession plan. even sumner redstone has succession plans. it's depending on one guy for all the senior management here. >> well those are strong words. are you suggesting that the stock is uninvestable in this current environment? >> the risk on the stock just went up because you better pray nothing happens to bob iger. >> all right. >> guys. >> well i'd say one of the succession plans potentially here, not at disney but at viacom and mr. red stone is probably this mr. staggs. somebody in this industry is going to pick this guy up, judge. so he's taking a one month,
12:25 pm
basically a month from now less than that he's gone from disney so unless something happens between now and then he's going to be gone on the market and he won't be on the market for long is my prediction. >> i think we could say that story about any ceo that's larger than life like iger. he has done a phenomenal job. the risk is racheted up if the ceo leaves. >> but you have to have somebody. >> absolutely. in terms of apple all she did was look back. let's talk about the next five years. >> you disagree with laura? >> i think it's an s&p stock. i don't think it's a super grower. i think it's a market stock. best days are behind it. in terms of out performance you can't say it's not a hardware company. it is period. >> i think the same. below 100 it's attractive. below 130 it's a sell. you're talking about getting into again a trillion dollar
12:26 pm
company. >> i'm long calls out in june. >> you disagree with the guys to the right. >> it's racheting the way up. the reason i picked the time frame out in june is because i wanted to give it enough time. that's where the heavy buying was. it wasn't in the short-term. it's throughout in june so the nice thing about options is is they give you a time frame. june tells me give it time rather than just jump in and jump out very quickly. >> i'm in there with john but the most interesting part of the entire note is when laura says everybody has got it wrong. they're all judging them off iphone sales. they should be looking at other aspects of the business. she brought up apple pay and the autos as well but there's a lot of different things she is talking about as well. she is talking about margin. there's a lot of things she sbringing up that we haven't heard from many analysts. >> everyone is trying to figure out what the worst growth driver could be and that it's slowing more dramatically than some people even think but we'll make
12:27 pm
that the last word. coming up no deal. the allergen pfizer merger is dead. we'll tell you how you can be trading those stocks now. two of the traders on the desk are dipping their toes down into the beaten down company. find out the reasons why, next. ♪ in new york state, we believe tomorrow starts today. all across the state, the economy is growing, with creative new business incentives, the lowest taxes in decades, and new infrastructure for a new generation
12:28 pm
attracting the talent and companies of tomorrow. like in rochester, with world-class botox. and in buffalo, where medicine meets the future. let us help grow your company's tomorrow - today - at
12:29 pm
here at the td ameritrade they work all the time. sup jj, working hard? working 24/7 on mobile trader, rated #1 trading app on the app store. it lets you trade stocks, options, futures... even advanced orders. and it offers more charts than a lot of other competitors do on desktop. you work so late. i guess you don't see your family very much? i see them all the time. did you finish your derivatives pricing model, honey? td ameritrade.
12:30 pm
here is your cnbc news update for this hour. the founder and former head of france's far right national party has been convicted for crimes against humanity for repeating that nazi gas chambers are a mere detail of world war ii history. ukrainian president meeting with japanese prime minister shinzo abe in tokyo. abe is saying if ukraine continues with internal reforms japan will continue to support the country to the tune of $1.85 billion in aid.
12:31 pm
united airlines fired the flight attendant that deployed an emergency evacuation slide on an airplane after it arrived in houston on monday. it didn't identify the attendant but believed she deployed the slide intentionally. it provided no reason why she did that, though. walmart will switch to cage free eggs by 2025. it comes a year after it urged thousands of suppliers to curve the use of antibiotics in farm animals. that's the news update at this hour. the halftime report is back after a quick break.
12:32 pm
frank abagnale. convicted felon and con man. that was a long time ago. you know, they made a movie about it. you were shown to be quite skilled at fraud. times change. now i help catch the bad guys. me too. i help banks detect fraud by applying cognitive analytics to public financial records and social media. so if somebody said, "catch me if you can...?" we can. let's do a sequel. it could be a buddy movie. i would like to have a buddy.
12:33 pm
man 1: i came as fast as i man 2: this isn't public yet. man 1: what isn't? man 2: we've been attacked. man 1: the network? man 2: shhhh. man 1: when did this happen? man 2: over the last six months. man 1: how did we miss it? man 2: we caught it, just not in time. man 1: who? how? man 2: not sure, probably off-shore, foreign, pros. man 1: what did they get? man 2: what didn't they get. man 1: i need to call mike... man 2: don't use your phone. it's not just security, it's defense. bae systems.
12:34 pm
for the rolls to be changed is a bit un-american but that's the situation we're in and allergen has a great future and we're a great company and it will workout well. that was the ceo here on cnbc talking about the termination of the deal with pfizer days after the treasury introduced new rules targeting tax inversions. he was caught off guard by the move. >> i did as did pete and i think john bought it yesterday. it was just glaring. i don't think it's hugely undervalued. it should be at a market multiple or maybe a premium. so maybe it's 270 or 280 but it
12:35 pm
was so beaten up the fast money had left it and you had to step in and the ceo interview that cnbc had which i was clued to was phenomenal and actually just hearing this ceo i always valued talk with the confidence. >> confidence was the word you took away from mr. saunders today. >> i think the biggest thing that he said that to me was the fact that when ceos in the united states have to worry about the rule of law, have to worry about the treasury department changing the goal post in the middle of a deal, that is huge. he said they do it in india. they do it in china. they do it in cuba. our ceo's have to worry about the rule of law when it comes to transacting business. that's a scary thing. >> i bought options and same reasons i'm looking at the stock. you never know are you right or
12:36 pm
wrong? so i bought a little bit of time along with i but when he's talking about the 7 different segments and their leaders and he talked about 70 mid states or late states and what a pipeline and oh by the way they get 40 billion on the teva deal as well so they're going to have cash and be able to keep using the stock itself. there's going to be acquisitions for the company. >> you're staying at such. and over the last couple of days still continue to do something. >> that stock is soaring today on the heels of bill ackman's call with investors moments ago after posting a record quarter loss. and listening in and has the very latest. and regain most of his investment value overtime. and hedge fund manager lost
12:37 pm
about a billion dollars since activities can first took a state in the drug company last march. now otolaryngologylining three ways they will regain through improved governance and filing it's 10-k which it is expecting to do in april. a hand full of candidates are being considered for the ceo role after mike pearson stepped down recently. ackman didn't give any more additional research on the search. now it's still betting on a merger between canadian pacific and norfolk southern and it will get a vote of confidence and there's a proposal on the proxy and consider such a merger and holds canadian pacific and he also touched on the selling of a 20 million share block saying that the company had to adjust it's portfolio. they said it does remain a core holding. continue to be negative on
12:38 pm
herbalife. they continue to believe that it's a pyramid skeel acheme. that's a quick wrap up of what he had to say in his quarterly call. >> 3.5 years after that short was initiated we're still hearing about it. what's your deal with valeant. you are along the stocks. >> i think we spoke about it during the break, the fact that you can sell the 25 puts and we saw a lot of that on the desk. selling the 25 puts and buying 50 calls was very good. this is before today's news. is fact that he said listen the ceo search is not going to be months longer than that. it's going to be weak so for them to get it out by the end of the month, the fact that the ceo search is probably going to culminate in the next couple of weeks so the blow up of the allergen deal and pfizer i think it helps valeant.
12:39 pm
>> that ad hoc committee not finding anything massive or surprising. at least not that we have certainly learned about. doc here in the options too. >> i'm long and in other words obligating myself to buy the stock. i did it and talked about it about ten days ago when the stock was under $28 a share. i was selling the 25 puts. the one that john just cited. they were priced as if the company was going out of business. this is a company already down 70% or whatever. could it go out of business? sure it could but i didn't think it was. obviously you're being rewarded if you made that bet. the volatility has come down from 200 because it was over 200% to 110 so that means that the options have gone like that. i'll still stay short a bunch of them and hopefully take the rest off in the next couple of days. >> to me it's still very unanalyzed and we'll have a better opportunity looking at
12:40 pm
it. >> has it moved from the uninvestable nature that some folks said it was to now we have maybe a little bit more clarity on where things are heading that it's worth a shot. >> the answer is no. because until the filings are out you can't analyze it. is it a trade? probably. but again let's address what bill said about it being a dream job for a ceo. the only way it's a dream job for a ceo is if he's a frustrated attorney. they're going to spend a lot of their time being deposed in the courtrooms and everything else. i'd rather play the bio tech sector that bottomed me out before where there was more upside because they're going to be the acquisition targets for so many others. >> let's move to a story new at noon now. more hedge fund news this hour. focused on chase coleman's tiger mobile. >> that's right. further evidence of pain in the hedgefund world.
12:41 pm
tiger globe's hedge fund dropping 22% in the first quarter with paper losses exceeding $1 billion. that according to dow jones quoting sources. at the end of 2015 the biggest holdings included amazon, netflix, apple, price line, we're talking about tiger global that was founded by one of them under robertson. they manage about $6 billion in assets and they made big bets in technology and so far a rough start to the year. >> thanks so much. steve what's your reaction to that? >> if you look at what he has done, he has generated tremendous returns for his investors over the years but he's also been in the private sector a lot in terms of being the bc. we saw what happened last week or the week before writing down. part of it may be there. it's not completely segregated. you live by the names in the volatility and you die by the names in the volatility. stocks like google did nothing.
12:42 pm
as a matter of fact it sold off. those stocks come back. i'm going to bet chase coleman coming back as well. he's a greating manager. >> oil is moving higher and tracking it's best move in nearly a month. halftime report is back after this. they may want the latest products and services, but they demand the best shopping experiences. they're your customers. and by blending physical with digital, cognizant is helping 8 of the 10 largest u.s. retailers meet their demands with more responsive retail models... ones that transcend channels and locations, anticipate expectations... creating new ways to engage
12:43 pm
at every imaginable touch-point. it's a new day in retail, and together, we're building the store of the future. digital works for retail. let's talk about how digital works for your business.
12:44 pm
12:45 pm
big government and big crack downs and the people that manage your retirement money. we have the winners and the losers. plus what's a better way to may this market right now? etfs and is the new york real estate market headed for trouble? the power broker is here and will tell us what she is seeing. top of the hour on power lunch. meantime over to sue with breaking news. >> this concerns the ex-ceo that was convicted of violating mine safety standards in the deadly mine explosion that occurred in
12:46 pm
2010. and a $250,000 fine. in that 2010 blast 29 men were killed in that west virginia mine accident. >> thank you so much. let's move to oil now. it is surging today. 5% tracking for the best day in nearly a month. jackie is down in new york city. jackie. >> hi, good afternoon to you scott. we have that surprise inventory drop this morning and u.s. production getting ever so close to $9 million a day and that is spiking crude more than 9%. this is a bounce that you can trust when it comes to crude oil or are we still range bound here. >> i'm selling this bounce. resistance at 38. here's three reasons. saudi arabia you only need to pay attention to them. ignore the rest of the noise. saudis are fighting with iran right now in asia and they're not going to let up on production. this freeze is not going to happen. on top of that the major resistance at 38.
12:47 pm
watch the dollar later today with the fed minutes in this overly dovish sentiment we see right now. the dollar should recover and put pressure on commodities. especially crude. >> the key levels to watch here when it comes to the crude trade and crudes and stocks should be closely tied. is this a positive sign? >> it's great to be in new york with you. a great level of resistance. $38. last week let's remember the crude oil inventories. we saw a big move today on the draw down versus the expectation and the last week we saw 80 year highs in these levels. right now bill is right. we should see a move back off the 5% pop and go back down to $34 and oil continues to drive everything. look at the stock market turn out at the exact same time. although these are important the fed minutes and the dollar undercurrent trumps all. >> always great to have you here with me. meantime for more on futures head to the website futures
12:48 pm >> so pete, oil continues to drive everything. hard to argue. oil is at the highs of the day. stocks are as well. >> we have not broken yet. this trend has been going on. there's been a day here and a day there. maybe a couple of days once in awhile. >> weaker dollar is not hurting the situation. >> the fed comes in and things do change for a day or two but oil continues to be the primary driver in this marketplace. look where it is and you'll find out where the market is. >> inquirily. >> china pmi last night. oil picked up last night. i don't get enough sleep but watching that it was oil starting to go late in the afternoon and picked up after the pmi and rally throughout the morning so obviously they help. >> coming up, john excited about sitting in the top spot in the halftime portfolio challenge. the leader board is changing almost daily. ♪
12:49 pm
12:50 pm
12:51 pm
12:52 pm
12:53 pm
12:54 pm
let's go to the leaderboard. our halftime portfolio competition. jon, jim and joe are at the top.
12:55 pm
and, boy, jon and jim are fighting it out for first place. >> yesterday, judge, i put on transocean rig. made a very nice pop and i took off half of that today. also took off half of marathon, which i put on with you last week on thursday when i called in. and i took off all of ebay and let's see -- no, all of amazon and half of ebay. i'm trading out, taking some profits, trying to follow my own advice and hit singles here. >> got you. follow all the action, talk about twitter. big week for that company. shares are higher since announcing that deal to stream nfl games. john, you own the stock. >> options. >> but you're bullish on it. >> bullish on it. $9 billion market company. linkedin is 15 billion. i don't know how they're advertising revenue works on linked
12:56 pm
linkedin. there is a gap between facebook at 320 billion and twitter of, you know, 12 billion. depending where the stock is right now. if we look at -- everybody is so concerned about user growth, i think it is more about monetizing the 300 million people they have on the platform now. i think that's where anthony is trying to do. so i think -- >> get more users. the story lives and dies on user growth. >> if you can monetize 300 million users, like bill miller said, if you get a penny or two pennies or three pennies a month from 300 million users, that's a lot of money. we're not talking about huge incremental money that has to come into twitter. all we need to do is figure out -- facebook had the same problem. facebook had to figure out how are we going to monetize this platform. i think now -- but nfl is huge. >> 300 million users 300 million users stagnant, different than a billion users growing.
12:57 pm
i want to move the debate forward. >> is that worth 26 times? >> that's another debate. we discussed yesterday the real impact of what the nfl deal and the streaming deal is going to mean for twitter. some people were skeptical. no one more so than scott devitt at steifel who called it a hail mary. today, maybe, after digesting it more, he says upon further review, he went to the replay booth -- >> he did. he made a call. >> he said, not a hail mary, but more likely than not a dump pass into the flat. an incremental move, i think he's trying to make the point, rather than something that sounds so desperate that you're heaving the ball all the way down the field, hoping for some miraculous catch. >> i love all the football references, but i still look at this, scott and think it is an opportunity and a very inexpensive opportunity for twitter to re-engage with a lot
12:58 pm
of the lost use they have had and find some growth even internationally, maybe in the u.s., whatever. they're going to be able to put themselves up with this nfl deal and anthony got a very good deal from the nfl on this whole thing for $10 million for the games they get on thursday nights. those are going to be on television. that's why they got a better deal. it is different than the yahoo! deal, but it opens up potential for the millennial world that is sitting on those phones, scott, and on the devices, not watching the television. this could engage them. >> nfl tv though, right, judge? thursday night games, nfl, right? so not everybody has nfl tv. if you can watch that streamed, if you're a verizon customer, already had it. if not, you didn't have it. this is a way to get into that group. >> let's use both football things here. can twitter run the equivalent of a west coast offense, with short passes and move it down the field and score some points, or does it have to be the raiders and throw it deep every play? is that what it has come to? >> i think at this point, only
12:59 pm
if you show some marginal improvement. on the margin, this is a good story. west coast offense, it depends. are they running it with kaepernick or running it with somebody else that can't do it so well. but, bottom line is, just improvement, expectations so negative here that just move the ball forward. >> okay. >> let's move to harley, which is moving today, love your thoughts on this. and question as to whether they're losing market share, doc. >> they might be, judge. there was put activity yesterday in harley. today itg comes out with some cautious comments and the stock trades down. i think about 3.50, 4 bucks. but it made a nice recovery off recent lows. people just -- i think took the itg note very seriously. >> speaking of notes, wells fargo was downgraded weiss at guggenheim. >> to a neutral. >> look, you don't -- you never bought wells fargo for the valuation. you bought it because it is the quality play in the group long.
1:00 pm
jpmorg jpmorgan. that is not going to change. energy is just not a big issue at 2% of the whole book. and not all 2% is going away. i think it is misplaced. i think this is one you want to own if you -- >> good stuff. j john, good having you here. "power lunch" starts now. welcome to "squawk box." he "power lunch." i'm here with melissa and brian. we kick off with big government, big money crackdown. we're talking tax inversions, oil deals perhaps going bust. and even your nest egg. so let's start with the $160 billion deal gone bust. pfizer and allergan calling off the so-called tax inversion merger after the u.s. government put the deal in its cross hairs. let's bring in jared bernstein, senior fellow and james


info Stream Only

Uploaded by TV Archive on