tv Fast Money Halftime Report CNBC December 6, 2016 12:00pm-1:01pm EST
it does raise certain regulatory questions to make sure all content is treated equally over broadband pipes. there will be a big hearing on that deal in washington d.c. we'll be following that as well. >> awfully big story. thanks, julia. what a morning, right? luckily, the dow was behaving down only 10. let's get to headquarters and "the half." ♪ carl, thanks. welcome to "the halftime report." i'm scott wapner. our top story this hour. the market has it all wrong. those strong words today from the head of investment strategy for the world's largest mutual fund company. the question, though, is he right? joe terra nova, stephanie lirng, pete najarian. let's begin with van garde's joe davis who writes that the market is getting ahead of itself and that growth isn't nearly as rosy as people think. we welcome in joe davis from pennsylvania today. joe, welcome back. >> thanks, scott. thanks for having me. >> why do we have it wrong? >> well, i just think we have
had a significant change in sentiment. if you just go back to the tape six months ago, there was a really strong concern in the market, bond market, equity market around this growing sense of stagnation. we were skeptical of that. at the same time the clear focus on reflation and risk by many investors, i think the truth is somewhere in between, and that's what we mean by both views are too optimistic today. >> yeah. maybe we underestimated, though, where the economy actually was before the trump election and now we maybe, okay, we're feeling pretty optimistic about where we think tax policy can go, a stimulus plan could go, but the fundamentals, though,ing are in some ways justifying a stock market rally, no? >> well, i think part of it. i think we went into the u.s. remains resilient. pessimists were saying 2% growth at best. we were closer to about into 20173%.
i would say the equity market particularly in the u.s. is pricing closer to 4%. that's what i think, again, we could get there, but i think unlikely for 2017. >> you say that further monetary stimulus will prove unproductive in spurring unlevered growth, and you are talking about global growth that's stabilize, not stagnating, which you are making the case. what if it just improves a lot of people wrong and starts reaccelera reaccelerating? >> the strongest case for acceleration would be in the u.s., and that would be ironically in a period where the central bank -- by the fed actually raising rates. i think history will show that negative interest rates were a mistake from the standpoint it's not going to lead to a whole leveraging upcycle. it's not warranted. i think too much pressure has been put on central banks to be fair to them. i think that's the one positive we've seen is a little bit more room and scope for fiscal stimulus, which at the margin should be a more balanced policy combination. >> are you just flat surprised by the trump rally and has it
forced you even as you raise some of the red flags to raise your own target as to where you think the stock market can go as long as this level of optimism remains? >> we haven't changed our equity market outlook. we've been into the mid to high single digits for portfolio stock returns the next several years. now, this year was higher than those estimates, and that's since i would be a surprise, and that would be fair. i think where the surprise has been, you know, to the market has been the interest rates, which are now in our minds closer to fair level. i just think don't we should scrape over or ignore the sort of secular forces that are city council a play in the global economy. >> sh% is incredible.
now we're at the upper end of historical valuations. really no matter how you want to slice it. price to book, whatever. then you look at international stocks x u.s. annu annualizing at 5%, which is atrocious. merging market equities. annualizing at 0% or more depending on how you construct the index. how is it not the most prudent thing on erlt to do to be diversifying outside of the u.s. market even if you love trump and you think you're getting tax cuts as far as the eye can see. how is that not the smartist thing that an investor can do right now? >> i actually -- i just love your points. i think that's something that -- it's not just growth per se. it's the price paid for growth. valuations outside of the u.s., not nearly as elevated. the cash flows have clearly been at the back seat and have been a talin for the markets. i think many are doing so. there are certainly headaches and pressure points overseas,
and it's all the more reason not to exceed those markets because they could offer some compelling value longer term. >> joe, we appreciate your time and certainly your points of view today. look forward to having you back soon. >> thank you. >> van garde's joe davis. what do you make of what you heard? >> i don't disagree. i think there are parts of the market that are ahead of themselves. i love the run that we've gotten in the financials. i actually still think -- >> you still have made the argument to keep putting the work -- >> today i took it off. not for any negative reasons. i didn't see anything out there that said, hey, i have to get out there, but the run has been spectacular. it continues and even just in the last week or so, scott, you look at the xlf just in general of 22.5 percent up to 23%. there's a lot of reasons to say take some off the table. i still remain in bank of america because of all the names i think that has the most upside from here. >> if you listen to what some of the companies are saying at the industry conferences and financials they're saying quite good things. jp morgan, jamie dimon very
bullish. i don't think the narrative changes about pro of had growth until the end have the year and into inauguration. i don't know what happens after that. i'm going to stay with the cyclical bias between now and then. >> he makes the point clearly that will people have gotten too negative, and that was wrong. now people are getting too positive, and that, too, is wrong. it's somewhere -- >> we just have to figure out where the middle is. or you guys have to figure out where the middle is. >> you made the point at the top of the show. the economy is better. the economy is better, and trump hasn't even put in trumponomics yet. >> it's marginally better. >> i can list a whole bunch of things that were better than expected. gdp, consumer confidence, cycle high. all of the manufacturing data much better than expected. companies are now talking about a little bit more confidence. i actually think that is the margin better than just a little bit better. >> can we look at an xle today?
the xle essentially flat. barely down. a lot of the names are up. the xop, which is even more sensitive to the price of crude, barely down. a lot of the names in the index are up. when you have not great news but stocks reacting well either way, it definitely tells you that sentiment is shifting and is much more positive. >> oh, there's no question about that. >> i wouldn't say the knee jerk, oh, people are positive. sell. i hate that. i think knee jerk contrarianism costs people a lot more money the past seven years. >> people are justifiably -- it's not just positive, but whether some quadrants have gotten just down right euphoric. >> maybe. >> about stuff that hasn't even happened yet. >> well, so look at brookshire hathaway. up 10% since the election. there's no bigger enemy in all of the insurance industry of trump than warren buffett. he thrashed him and went to hillary rallies and destroyed him. the stock is up 10%. are we calling that the trump rally? i think there are other things
going on besides just post-election ebulance. it's important to point out, like steph did, that individual company fundamentals are improving. it's not either-or. both things can happen at once. >> i'm not sure how president-elect trump can impact brookshire's earnings, which is why brookshire is going up right now, and a reason why a lot of these companies are going up right now. we continue to search for is this the moment to sell? i don't understand that narrative. it's not about what you want to get out of. it's what you don't want to own. >> we keep asking the question. if so, where you would put your money behind the areas that could continue to propel it. >> i don't think it matters whether it's a trump rally, whether it's the economic resurgence that stephanie has talked about. >> whatever it might be, whether it's the comical rally of josh brown, it doesn't matter. what matters is the earnings -- earnings are accelerating.
manufacturing looks good right now. we've got an agreement in energy. we've got some possibilities as it relates to the financial sector. they'll get the animal spirits going once again. you ask yourself, okay, what's the potential roadblock to all this? the next thing that you see coming is earnings. that's kind of a long way off. >> i want to get to the other sort of talker of the day certainly, and news in terms of the president-elect and the move in boeing today, and the tweet about the cost of a new air force one, but then the comments from the man himself in trump tower. let's listen to this. >> i think it's ridiculous. i think boeing is doing a little bit of a number. we want boeing to make a lot of money, but not that much money. thank you. >> i just sort of want to pick up on this conversation we had yesterday where we were talking about the impact of presidential tweets and how they could impact
certain sectors. >> this is normal. you have a portfolio, and you could get nuked any day if had any name by an errant statement. >> we tried to make that point yesterday. i recall you were somewhat dismissive of that. >> i don't think long-term it really matters. all right. boeing loses $1.5 billion in market cap. ten seconds e seconds after i think boeing is doing a little bit of a number on us, folks. okay. fine. is that really going to be where the stock price is the next day, a week later, a month later? that's what i'm dismissive about. the long-term effects. probably not going to be detrimental to investors. >> even if people want to sort of characterize mr. trump's methods as a way to negotiate or the beginning of a negotiation, if you will, which is what i hear out there, the -- just the risk in and of itself of this and what it presents -- >> so every stock is at risk then. then every stock is at risk. >> maybe certain ones are.
et cetera that not true. >> maybe not every stock. >> i just -- >> kfc. it was terrible. >> that's nothing more than a comical characterization of what's going on right now. >> that's a problem. it was going to last for a while. this is what his method is going to be. this is what he feels his response to the media is going to be. >> this is not a response to the media. >> it is a response to the media. this is his belief that this is his way to level the playing field for the media. he is going to use twitter, and you have to ask yourself, by the way, does that increase the value of twitter? that's going to be what he is going to do. he is going to use twitter. we have to get used to it. >> there's precedent for that. eleanor roosevelt used pinterest. this is very, very presidential. the most presidential. the best presidential. >> maybe you have to start
looking at -- i don't know. across the government contractor spectrum and -- >> it's not the first time that politicians have made statements about public companies that has rattled their share prices. i mean, we think about everything in the post-crisis period when the london wales thing started to come out in the press. they called everyone from jp morgan back down to congress. it wasn't a great time to be invested in jp morgan stock. even though there was no material impact on the business, there was still fines, bad press, headlines, volatility. if it's coming from one place versus the other, it should not be a new phenomenon for investors. >> all right. there's a lot more ahead on "the halftime report." >> chipolte getting slammed. the company founders comments this morning leading that decline. what he said next. plus, why one wall street analyst just got bullish. and is this going to be a huge holiday season for apple? ceo tim cook says watch the
watch. is it enough to make the stock tick? more "halftime" coming up with scott wapner and the gang. hey nicole. hey! i just wanted to thank your support team for walking me through my first options trade. we only do it for everyone gary. well, i feel pretty smart. well, we're all about educating people on options strategies. well, don't worry, i won't let this accomplishment go to my head. i'm still the same old gary. wait, you forgot your french dictionary. oh, mucho gracias. get help on options trading with thinkorswim, only at td ameritrade.
you want to listen to piper or you want to listen p to the company's own executive who says the turnaround is not taking shape? >> piper has been bull ush since $700 a share. >> i think that says it all. right? >> what are we talking about here? >> they're both saying the same thing. if you read the piper note, they said you'll have to wait a long time. you have to be patient. >> why an overweight then? >> i'm not just filing it. i'm just saying they're both saying the same thing. that is a broken growth story for now. the company is very aggressive targets to expand their store base to double it. they have 2,200 stores in a $4 billion revenue base. that is hard to double over time. i'm not saying they can't do it, but i think those are aggressive targets, and i don't think anybody believes them at this point. the stock even though it's come down, it's trading at 42 times forward estimates, 19 times revenue. >> no buyers on the desk? >> absolutely not. i don't understand why you would want to have a long-term hold on to it quite honestly. why would i wait as long as this is going to take? why don't we wait until we actually see numbers, traffic numbers start to improve?
any improvement, and we've been saying that collectively on the desk for quite a while. until we see those numbers improve, which we have not, why put yourself in now because you're looking at a stock right now? >> it's a new did, is that a good enough reason to invest? >> you have the activist in there. >> it's going to take more than just the board. >> you need to see evidence of the turn. >> the company this morning is talking about taking the eye off the ball as it comes to customer service. okay. let's go in there. let's see customer service turn around right now. let's see some earnings reports where you are seeing an acceleration in whether it be margins or revenue itself. let's see the evidence to go in and buy this. let's just not say let's stay overweight to josh's point from $700 plus. >> the analyst has been overweight since january 30th, 2014. >> i have been overweight since the 1980s, and let me tell you something, this is an analyst who drank the quack mogu guacam. wait for actual evidence that we
know they've identified the problem, but that they've come up with a solution just doing what they were doing prior to the crisis that they had, clearly is not enough to turn the stock. not enough to get comps back. >> especially since competition is heating up if general and commodity costs are going higher too. the environment, the macroenvironment, has changed as well in the last several quarters. even if they can increase their traffic, it's a lot harder in this environment right now to get the sales to get the traffic, to get the people in the door. >> the take-away that you have to look at is when ai guy right? if he is right or if he is dead wrong, you can take the op is the side as well. when they are right, you follow them. this guy has been wrong for how long, right? you look for analysts, and that's something we are all doing. i do this all the time. i look for the analysts that are always right and consistently right and those are the guys that -- or gals that i want to follow. i mean, i have done that with apple for years. you pick out the stock. i'll tell you which analyst i like the best, and the one who has been right is the one i'm going to listen to. >> the right strategy real quick
has been jack in the box. qudoba, they continue to do it, and are you seeing the performance. stock keeps moving higher. why jump off? >> let's go to have a lock at what's moving right now. >> it's burritos to housing. shares of toll brothers moving session highs. the home builders correlate revenues beat estimates due to higher sales and average segment prices as well. you have other home builders like pulte, lennar, d.r. horton, kb homes. home builders certainly a focus in today's trade, scott. back to you. >> thank you so much. steph, you got something here? >> the stock is down 7% year-to-date. it's lagged the market and group as well. there's nothing you can poke a hole in other than to say the macrogets harder as interest rates go up. what multiple are you going to pay for that? 13 times is not expensive at all, but in my view i think rates go higher and that puts
the multiple cap here. >> you have the pattern since the summer of higher lows on each selloff. they sell it down to a slightly higher level before the buyers come in. that's construct their price action and what you want to see. i don't see a ton of resistance here until high 30s, low 40s. i think it's a relatively low risk entry. zroo we talked about this. i was doing a remote from minnesota just after the trump run, and he actually got elected. all that kind of thing. i brought up to you housing. i remember i'll never forget because diana ohlich hit me after the hit with you and said what, are you nuts? there is no chance for housing. all housing has done is go higher and higher. when you get numbers like this, that's why the earnings are so important. you go back before the election, and you look at all the earnings. in the financials. like you guys are saying. it was ready to take off. you look at some of the housing numbers. they're ready to take off too. i like -- >> toll skewed towards the high end. if we think that corporate tax
cuts, lower effective tax rate for corporations, individual tax cuts, if we think that those things are all on the menu, it's not a far leap to say if you are getting homebuilder exposure, maybe you want it from the higher end. >> i'll take them home. >> you trying to scalp with ohlich? >> we were going back and forth friendly about this he. >> did you see her guns? >> she's in shape. she thought i was crazy, and i said, look, when you look at the numbers that they're putting up across the board in the housing industry right now including the numbers she's reporting, things are getting better, not worse. >> better not worse. >> let's talk about apple. the ceo tim cook sounding very bullish about the company's watch sales. the details and that trader just ahead. bank of america getting bullish on some of the airline names, but with gains of 30% in the past three months already, is there really any more room to run? discuss that next.
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>> here's what's happening this hour, everybody. some important news out of washington. in a unanimous decision, the supreme court siding with samsung in its big money smartphone patent fight with apple. it threw out an appeals court ruling that said that the south korean company had to pay $399 million in penalties to its rival for copying key iphone designs. and in another unanimous ruling, the high court upholding broad powers to curb insider trading. the court ruling that sharing corporate secrets with friends or relatives is illegal even if the insider providing the tip doesn't receive anything of value in return. the man who fatally shot former nfl player joe mcknight has been arrested and jailed on a charge of manslaughter. ronald gasser was arrested late last night after initially being released last week without being charged. new research from triple-a suggests if you miss just an hour of sleep, your concentration behind the wheel of a car can suffer.
it says if you sleep just five to six hours a night, you are almost twice as likely to crash. the cdc says more than one-third have americans do not get at least seven hours of sleep. you're up-to-date. that's the news update. scottie, back to you. >> changing gears to apple. ceo tim cook telling reuters that the sales of the apple watch hit a record during the first week of holiday shopping and that the current quarter is on track to be the best ever for the watch. what about apple? >> i still own it. i still love it. i know we're focussing on the watch because of this news today, and it's great. i still think you're looking at all the other products. particularly the iphone, right? >> people don't want to give them any more credit for any watch sales. >> it's getting -- >> if steve weiss was here, he would be all over that. >> it's getting more and more improved, but that's not going to be the base driver. i don't think it ever becomes that. it's one more entity for apple and we talk about services being the growth area. i think that is true. i think the watch is something else, but the phone is certainly what everybody is still going to
be staring at, especially into the holidays. >> i can tell you in a conversation that i have been having recently with a lot of portfolio managers. they're excited because of the underperformance in 2016. it feels as though they're getting a gift. now you add upon that the possibility surrounding the ten-year anniversary of the phone, the talk about bringing this capital back to the u.s. of which apple has a significant amount, and i think what you potentially will see here in the first quarter of 2017 is a lot of money managers getting ahead of getting in on that and reacquiring apple in a position level that has been taken down from overweight status at the beginning of 2016 to really versus the benchmark a little bit below it. >> what happens if the optimism about trump and his platform becomes reality? what he wants to do actually happens and money continues to flow into other more favorable areas. >> yeah, but apple -- >> but apple is a poster child, poster child, for the
repatriation thing, and that's the most bipartisan thing being discussed within the whole firmament of this conversation. everyone agrees. they might disagree on what the tax rate should be, but so apple is, like, one of the companies that could benefit the most. that's one. two, the cool thing about the watch, if that's what we're focused on today, is that if they were to write off the whole watch unit tomorrow, no one would even blink. it's not a negative. if there is any up side in the watch, it's a lot of positivity that apple can indeed launch something new. i'm not saying that's the case, but the more people are saying positive things about the watch -- >> tim cook is saying -- >> great. great. it's very asymmetric. >> he is. >> it's very asymmetric. if there's not good news on the watch, who cares? if there is, it could be a lot more meaningful than just what next quarter's revenue contribution is. >> i trimmed some of the stock yesterday, actually, and i am still overweight. i still like it long-term, but i don't think the stock does anything between now and when
they report earnings. i think earnings, numbers still have to come down in terms of gross margins. i don't think it's a disaster by any means. >> you think the money -- >> i was buying it at 90, and i didn't get out of it at 116, 117 when most recent high. i just felt like 109, 110, you definitely have repatriation bullishness, and you have protectionism concerns. i think those two things are push-pull, and i think it's -- i think the stock kind of -- >> the picture of what's been happening in the market. taking money out of areas like apple and other technology companies and moving it into more cyclical areas that you think are going to fair better and have become so cheap and had underperformed for so long and may not anymore. >> i was very early on in cyclicals. too early. i was buying in the spring and into the summertime, so i'm not necessarily chasing the cyclicals here. i'm holding on to this em. i'm actually -- i actually sold some apple and bought a little
amazon. it's not so much that i don't like the fangs or i don't like growth versus value. i do have more a value bent. i do think that there's more opportunity in amazon. i think people don't like it as much. it's maybe not as understood at these levels, so i think that there's opportunity. i also think there's opportunity in sales force.com. palo alto. some of the growth quality companies have come down so much, and i think between now and the end of the year seasonally technology does well, and i thought those stocks would outperform apple. that's not to say i'm not still overweight apple. just less so. >> i respectfully disagree on apple because i think a lot of the underperformance for apple so far this year has been about disappointment surrounding a product. i don't own apple. pete has owned apple the whole way. i don't know whether he agrees with that or not. i think there's been this prevailing notion that apple really didn't present anything in 2016 to accelerate revenues to get the consumer excited. i think in 2017 you are going to get that. you are clearly going to get that with this new iphone. >> i think we're also making the point that you are 100% correct if that's the perception.
however, if you take that and then you say, okay, tech is also a source of funds since the election -- >> apple is a different part of technology in my opinion. what i also see is that institutional money managers like stephanie who have taken holdings of apple on the institutional side, i believe, somewhere at the height, somewhere around 74% of overall ownership. now that's down into the low 60s. that's a large amount of people that if they believe in a potential for 2017, are going to come back into this name, and to your point before, if you think growth and all the metrics of what president-elect trump is talking about, we're going to accelerate growth, i believe that apple is really is one of those names that has underperformed and would benefit most. in particular at the end of the year. >> i don't disagree with you, and your comments. i just think you have time to get aggressive. i think you wait until they report earnings. the gross margin numbers have to come down. then the iphone 8, we don't
start getting excited. it comes out in september. we have a long time, and that's a long time in the cabinet. >> carrie firestone was making that point. yes, of course, the stock is cheap when you look at the metrics. you can only come to -- >> it's wrong. it's wrong. >> however, it's still not a good entry point, at least in her mind. that's the point that she made to wait. >> the history of the way the stock trades, though, does not lend itself to this idea that we can identify when a product is coming and then time the right day to buy it leading up because tell me what product launched from july until last month when the stock ran from 90 where stephanie was buying and i was buying it on the show, we're buying apple, people laughing. fine. keep going. the stock runs from 90 to 120. no product launched. no catalyst. the chief competitor has an exploding phone. the stock runs 30 points. who saw that coming? 95 analysts covering apple for the sell side. who saw the galaxy note being an incendiary explosive device? no one.
this idea that we can say, all right, here's the timeline of the product, this is the date to buy it for the optimal -- it doesn't exist. it's fake. >> if i go back into what you are saying, the jim cramer philosophy is you don't trade apple. you own apple. >> you own it. that is exactly right. jim and i have talked about that forever. i mean, it's absolute. it's been a decade for me, scott, and the reality is what really was the -- you said there wasn't a catalyst. there was one catalyst. how about when buffett decided to step in there? that seemed to really get people's attention. that was about mid 1993, 1994, and then the stock took off from there. >> another catalyst that could never in a million years have been foreseen. ever. >> right. you don't foresee it. that's why you own it. >> at 90, it got ridiculously cheap. i could not not buy it. i do think it's cheap. it's not nearly as deep as it once was, and it's not nearly as hated as it once was. at 90, nobody wanted this thing. >> there's a stealth catalyst that people are not talking about, and the fact that all the capital that apple has overseas,
70% plus is overseas, and we have criticized that for the last couple of years for not making that acquisition. what if apple brings that cash back and says, you know what, we're not going to buy back shares. we're finally going to make an acquisition. again, that's a catalyst you're not thinking about, but if that money is coming back, they have a lot of it. they're just not going to buy back shares. >> maybe it will be perceived as positive or negative. >> depends who they buy. >> i wouldn't hold my breath for an acquisition. >> we want to engs many, as well, that apple is a member of cnbc iq 100 index. it's up marginally today. for more on that go to cnbc.com/iq 100. up next, some stocks we're auto on track for a green year, but they're now negative following trump's win. we're looking at the names that have been tripped up by trump and whether any are a buy right now. first, though, sully has a look at what's coming up on power lunch. >> hey, scott. my $70 analog watch says you came in a minute early. i appreciate that. thank you. we're calling it the art of the tweet. how trump continues to disrupt big business, including the biggest business of all.
washington. this time it's boeing, and the cost of air force one in the crosshairs. rise of the robots. it is technology, not trade, that is the real threat to american jobs. what can and will anyone do about it? will the president-elect now go after amazon. getting tough on insider trading. what the supreme court's newest ruling means for wall street. that's all coming up on "power lunch" before halftime reports after this. ♪ we're drowning in information. where, in all of this, is the stuff that matters? the stakes are so high, your finances, your future. how do you solve this? you don't.
>> it's time for the trader blitz. first up, bank of america upgrading united airlines to a buy. bumping the price target on delta as well. >> delta $11 higher, and then you look at united airlines, and they jump it by $15. they're probably a little late, and it's been moving, but we talked about that with the financials as well. there's nothing wrong with taking off a little bit right now, but i understand why they moved up some of the price targets. you can understand the upgrades. these are all still single digit stocks, scott, in terms of the pe level. you can understand i wouldn't be chasing it right now. >> all right. auto zone. they beat on the bottom line. they're showing improvement in margins as well. joe, the stock is up 1.5%. >> it's taking me to where the
stock topped out. i would imagine it was a sale for people that got burned back in july when the stock fell. overall i like the fundamentals of the industry, but i have no problem taking some profits here as you run into the wall of inventory selling. >> coach goes to credit southeast's top apparel. he this say it's best positioned in the affordable luxury group. steph, do you agree? >> of the handbag market, i do like this one the best. i this i knee done the best job on the product transition. >> it's a hold. josh. >> super bullish. >> let me give you the technical setup here because it's really, really interesting. this is a stock that struggled twice between 130 and 135.
it's been resistance. it's had a declining 200 day moving average all year until now. that moving average is now turning up. you saw the stock fall almost since the earnings gap and it didn't quite get in there. the buyers came in at the rising 50. i think get above 130, there are no sellers. this thing could go ballistic, but i would wait before pulling the trigger. >> next up, the options market weighing in on a stock that is already up big this month. pete is tracking it. he looks at the unusual activity. he has found it. he will replace those five question marks with a name. when we come back. before that break, though, what gold's tough month says about the month ahead. we're back after this.
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volatility, however, and it's pretty interesting. also, what's going on with the ceo, everything that's happened with starbucks. i think the most interesting thing now is how aggressive people got today. just last week they were selling puts. somebody expected the stock to actually start to move to the up side, which it's starting to do, even post what's going on with the ceo. now all of a sudden today we're finding very aggressive buyers over 9,000 of this week's expiring. we're not going out any time at all. on friday these expire. the 57 1/2 calls, 9,000 of these were bought today. scott, somewhere between 52 cents and 72 cents. let's say it's about a 60 cent average price. a lot of call activity in there expecting this thing to go above it. it's trading right virtually at that number right now. we'll see if it can bounce. i'm in it. i like it. i'll be in there for a couple of days. we'll see what happens. >> all right. come on back here, pete. we'll talk about nike, and i want you to participate in that as well because it is the worst performer on the dow. there are a couple of negative notes. we're seeing one now. cowan, they've downgraded to
market perform. that's from outperform. they say that nike share lost to underarmour, and adidas could accelerate. >> you made the point that you thought adidas run had sort of topped out. >> adidas run -- adidas's run in august did stop out. the stock has pulled out ever since. i do believe nike could be the beneficiary of seeing inflows. i also stated that i was wrong in believing underarmour would be the one that would be the winner versus nike. i think clearly the evidence is suggesting that nike is the winner. i disagree with both of these calls that were just put out. >> you mean the winner versus -- >> well. >> nike is the winner versus under armour. >> you said if money comes out of adidas, does it go into under armour, or does it go into nike? i believe that it would go into under armour first. i thought your interview with kevin plank. i looked a lot of the things he had talked about. the reality of the performance of the stock does not suggest that. >> they are also saying in this
note that millenial brand preference is shifting to adidas and under armour away from nike. you made positive point a million times on this show. based on what your own kids -- >> i have made that point. i have made that point. the small -- the market is way smarter than i am and what the market has been telling us is that adidas had been the place to be there's money coming out of it right now. where is that money going to go to? it looks look it's going to nike. >> markets seem to suggest that the kind of valuation that under armour had been trading at, they may not and the company said this, in fact, they may not be able to reach their prior growth targets that they had laid out at an analyst day, if i recall. >> right. the amount of capital that -- >> growth level can achieve the valuation level. >> and the aggressive spending. i mean, i think that's something everybody has to understand in terms of under armour. i do disagree on adidas. i think the pullback is an opportunity. i like adidas here. by the way, nike, far too cheap.
it had a valuation that was extreme. now that it's pushing to the 52-week lows, i like nike as well as adidas right now. under armour, we already had a guy talking about that earlier today. talk about long-term waits. this is a long-term weight. it's got to be a show me. it's trading like chip oe-- chipolte right now. >> whether it's from ayas or puma or under armour or any of them. your gross margins -- they're also investing heavily in technology. that's going to put a crush on gross margins. if gross markins are leveling off, you don't have the operating leverage. 22 times forward estimates is in line with the three to five year average. it's not particularly cheap based on historical. >> while we're having this conversation, footlocker making me all-time -- >> and that's been the way to play it, according to people on this desk. >> yeah, sure. one season under armour has the jump on nike. >> others have made that call. >> they'll go back and forth.
they'll get a hot athlete or a particular sport will take off, and they'll go back and forth. the place to be to buy this stuff is footlocker. the on-line experience does not rival what the kids are doing in these stores. doesn't really compete. wal-mart and target are not selling high-end sneakers to the degree that maybe they should at some point in the future. footlocker has the game on smash. this is the stock. it proves that every single day. been going up pretty much every week since the summer. >> all right. crude prices are lower today, and that's after a big run for the week. we'll tell you how to play that next. plus, the trump trade. we're breaking down the stocks that have turned negative for the year following the election. what do you do with those? we'll try and tell you next. shift in human history ulan is happening before our eyes. sixty to seventy million people are moving to cities every year. at pgim we help investors see the implications of long term megatrends like the prime time of urban expansion, pinpointing opportunities to capture alpha
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we want to keep our community safe. this is our community, this is where we live. we need to make sure that we have a beautiful place for our children to live. together, we're building a better california. welcome back. we have some more news concerning president-elect donald trump. cnbc learned that president-elect donald trump sold all his shares in companies in june. that's according to jason miller, the trump spokesperson this morning, to avoid any conflict of interest. the wall street journal reporting and citing a may filing which was filed with the office of government ethics in may. those investments were in a wide range of well known companies including amazon, apple, boeing, and visa. he had at least two brokerage accounts that held roughly 150 separate corporate stock and bond investments. that is according to the filing that was filed with the
government of ethics department back in may. so you're up to date on that. now to cnbc's jackie deangelis at the nymex with futures now. >> thanks so much. watching crude oil closely, down for the first time since last week's opec decision. we have a lot of data out today we're going through. we have production going up in the exporting regions, then the eia saying that production will retract less than expected -- next year. and also that demand is going to be less lackluster than expected. how do you parse through all of this? >> all bearish news there. focus on opec. we had a rise, 15%, prices rise 15% on talk alone. you might say, they did announce an agreement, but history tells us that we have to take those agreements with opec with a grain of salt. so the market now is looking for a catalyst to take us higher. that will be the real numbers. did they cut? if it shows they did, we go
higher. if it shows they didn't, we're going lower. >> jeff, as we get closer to that $50 mark, are you a buyer or seller? >> i think a buyer, jackie, i see a little reprieve, crude oil down a dollar today off the 52 level. looking at 48. that was resistance over the summer. resistance turns into great support, but we're looking at implementation of the opec cuts. those cuts get a little -- we could see 55, $60 in the q1 of 2017. >> tune into the online show at the top of the hour. we're talking to helima croft. we're talking to bill stone. he's discussing the fed in front of the meeting next week. futures now.cnbc.com. >> dmglad you mentioned energy. >> nat gas, yes. natural gas clearly moving higher and higher above $3.50
right now. very difficult to kind of make natural gas investments. i don't believe the etf is the right strategy for investors. i think you look at exxonmobil, which has the strong natural gas division, there are some other smaller names you can look at. pdce is the name that markets natural gas, f.a.n.g., not the f.a.n.g. in the technology sector, but a stock called fang works well. you can look at chesapeake, chesapeake making a turn around. >> we know the broader market jumped since the election. but did you know that several stocks have taken a pretty big hit? we're going to tell you some of what they are and they're probably names you don't recognize right away or at least haven't thought of right now. we're back after this. this is where i trade andrs. manage my portfolio. since i added futures, i have access to the oil markets and gold markets.
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is it a force of nature? or a sales event? the season of audi sales event is here. audi will cover your first month's lease payment on select models during the season of audi sales event. welcome back to "the halftime report." not everyone has par it is a tin the recent trump rally. some names have gone from winners to losers in the past year. eric here to break them down. i mentioned people may not know some -- people know the names but may not realize the hits. >> one-third of the s&p 500 is down in the last four weeks. so it is not a rally if you're one-third of the companies. 19 of the companies in particular, they were up year to date through november 8 they have fallen so far so fast, the
entire year is negative because of what happened. some of these names, we're talking colgate, mondelez, philip morris, those -- >> colgate down 9%. mondelez down 11. philip morris down 10 since the election. >> all of them big international companies. 75% or more they sell outside of the u.s. look at what is happening interest rates. >> big dividends, right? >> all getting crushed. there are three of these other companies. we could go on and on, but a lot of household names. >> i think it is the dividend being competitive with rates. rates going up much more so than trump has beef with, like, mondelez. >> of course. i think -- when cramer was sitting in chemy's chair, suggesting some of the stocks, your chair, for this moment, for the next minute and a half, that some of these staples have gotten hammered to the point where they are now attractive. >> the problem is that most of them trade about 20 times forward estimates and the
long-term average is about 19 times. they're not super cheap. that says, i do own mondelez. 3g comes in, they're going to buy somebody. i don't know who it is going to be. >> you don't think that ship has sailed? >> no. if they come in and make an acquisition, i think staples rally. one group you can't be underweight or short because you don't know when they're going to come in. i got a margin, emerging market story, that one i'm willing to hold on to. i did sell one of the names on your list was visa. i did sell that one. that is super expensive. >> visa, kellogg's, google, coke, they're all negative. you look at charts november 8th, they peeked, they went straight down the next two -- >> do we think they're buys, some of these now. >> i think coke is. i own coke and i'll add on to it before the end of the week. >> google. >> smucker. >> final trades too? >> yes. regions financial, moves higher. why? because analysts have upgraded
the regionals and other financial names. this is going to be a theme going into the end of the year. >> baker hughes into the thursday analyst meeting with ge. >> stay with the financials, the too fast -- too far, too fast. >> jamie dimon, most important thing is basically signaled to us we're on pause in the market at these levels. >> get the chair back now. >> anytime. >> "power" starts now. i'm melissa lee. here's what's on the menu. art of the tweet, how donald trump is changing the way business gets done in d.c. rise of the robots. could amazon's latest plan put americans out of work. we'll talk about this and much more with michael louis, who joins us straight ahead. "power lunch" starts right now. donald trump's comments on boeing not hitting the stock market that much. boeing stock is down today. that's helping keep the dow's