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tv   Squawk on the Street  CNBC  March 28, 2013 9:00am-12:00pm EDT

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be choppier. don't think we'll have this sort of levitation as your default mode. check out our new talking squawk blog on our squawk had t squawk.cnbc.com. join on the street begins right now. ♪ good thursday morning. welcome to "squawk on the street" on what is the final trading day of the first quarter. i'm melissa lee. live from post nine here at new york stock exchange. let's get you set up on how we're going to start trading today. we did get jobless claims in above expectations. q4 gdp revised higher. s&p and dow looking to open a little bit lower. better than expected german retail sales helping the markets across europe. but we are focused on sigh
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truss. the nikkei in focus in asia as japan looks ahead to next week's big boj meeting, this under new leadership. blackberry, a surprise profit, revenue miss and continued decline in subscribers all sending the stock on a volatile ride with the premarket, all shares trading higher. cyprus banks reopen for the first time since march 16th on the strict capital controls. s&p 500 denied its record once again yesterday as we look to close out month and quarter today. pvh feeling the heat with its weak guidance taking the stock down. cramer's take on those shares. the blackberry analysts had expected a loss of 29 cents a share. plaque berry lost 3 million subscribers during the quarter but sold 1 million units of its new z-10 device. the numerous changes at
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blackberry over the last year are having a positive impact. he will be a guest on street signs today at 2:00 p.m. eastern. that's a must-see interview. just watching the stock premarket, what a ride it has seen. amazing. >> i think there are people who want this stock down. we've been talking a lot in a very safbvy way in this network about how many people were shorted. let's not lose the -- this company was supposed to have a terrible quarter. they did not have a terrible quarter. makes it more likely they'll be in business for a long time. makes it likely microsoft or nokia makes a run at them. when you see a company make this money without the new product, gi back to some parts -- morgan stanley piece saying, maybe you don't even have to think about the device. subskripgs model is good even if you lose some subscribers. >> the lesson being these things do get overdone on the down side on occasion when there's a great deal of emotion involved and it
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does appear that there's no end in sight in terms of subscriber losses. but this stock is up what? >> so is hewlett-packard. so is best buy. these were stocks -- >> those best buy at $22.50? >> no, i don't want to own it. blackberry, there were questions about its balance sheet. the guy that's going to be on "street signs" -- let's give him this. he's managed to fix that balance sheet. balance sheet fixing is stage one. >> all works in progress. zplf course. but look at cash, $2.9 billion quarter on quarter unchanged. that's a good sign considering they had a product launch and fees pli had to spend some money to launch this product because the carriers weren't behind this product launch. margins were very good, too, which reflects higher selling prices for the new device as well as the subscription model that you talked about. 40% were the margins. not bad there. subscribers declines though, we
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will have to see an end to that. >> discouraging. we know this blackberry product has big, big support overseas. indonesia. >> very interesting market. in all seriously. >> listen. >> i think one of the things that we forget is that this is an entrenched products. they're a little bit more difficult to unseat than we tend to think. i think that this company was on the ropes. it is not anymore. it could be acquired. also i think could be worth a lot just from that subscription list to do a joint venture. i watched t-mobile the other day. talking about separating -- getting the true cost of what people would buy for a handset. maybe blackberry could be giving away, you get the subscription. there's a lot of things that could go right with blackberry if the balance sheet has
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improved -- which it has. >> cash being steady. the point is worry's going to have them to kick around for a little bit longer. >> that's exactly the point, carl. there were a lot of people who felt when the stock was much lower that this was going to go away. it's not going away. maybe that's the talk of this stuff. >> you know what's surprising, too? playbook sales. 370,000 playbooks sold in the quarter. have you ever seen a playbook? talk being about the playbook, i feel like it's like sasquatch. have you actually ever seen it? >> no. >> everybody wrote that thing off as just not worth much. >> i don't want to big foot that, but i'm on the hunt. maybe bomber has one. he's got a lot of strange devices. what's that software -- that device he has? that kocould be a sasquatch thi.
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>> if the vice chair and co-founder sell their stakes. they're really trying to put the past behind them. maybe this is a new chapter for them. >> i always thought the boss was like michael dell. he was blackberry. gone. >> it's not as though we're talking about a great growth company here. right? we still don't know how well this thing's going to sell. granted, maybe there's been a bottom put in. things change awfully quickly. but they may not go anywhere with the z-10. >> i remember rick hill, the ceo -- >> the device is everything. >> bear with me! i'm going somewhere! it's a segue!
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segue! >> rick hill, the ceo of know l novellus came on "mad money" and said samsung has a device that's a smartphone. everyone's using it in korea. yeah, the iphone's coming -- wrong. things can change quickly. >> it was a long road but it was really worth it. >> how could i have truncated that? >> things can change quickly. >> that's my point. >> if ford were here he'd say it is beyond the hand set, it is services revenue. but it remains to be seen where that story is going to end. >> ford is just a fun guy to watch. banks reopening in sigh truss today for the first time in almost two weeks. latest chapter in that country's bail-out saga. michelle cruise sew cabrera has the latest. good morning. >> reporter: good morning, carl. we want to tell you in the last
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hour or so the parliament of this country has announced they want to try to force the head of the central bank to resign because of the bail swrout agreement. i want to show you what the scene was like just a few hours ago when the banks finally reopened after being closed for two weeks. people were desperate for cash especially we found elderly people who did not have their atm card, nef had had one because they don't use them or people who had lost their atm ward pressed up against the glass, fighting to get into the bank so that they could finally get some money. once they do get some money there's going to be a lot of restrictions in place because they fear the flow of capital leaving the country. yearly 300 euro withdrawal limited. no checks cashed. only deposited. businesses can process all the payroll that they want. other transactions, they can do what they want up to 5,000 euros. after that they're going to have to prove that they are paying a plier for something because they don't want money manufacturing
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out of the country. they're relieved banks are open but they know it is still a very tough road ahead for the country. >> a lot of money has been lost so the situation is very bad. it is going to be worse, i think. >> reporter: there was a huge operation under way in the last 24 hours to move cash throughout the system in anticipation of the opening. you saw a large amount arrive at the central bank last night. there's a private security company, g4s that has the mandate to do the deliveries. 35 armored vehicles moving throughout city. a lot of small drop-offs to atms. the head of the central bank has taken the blame for this bailout agreement which the people find so onerous and awful. requires them to shut down one of their biggest banks and dramatically downsize their other banks. there will be massive job losses
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and a contraction of the economy, anywhere from 10% to 50%, depending what economists you talk to. >> can only imagine security surrounding those large buckets of currency. last night they said if you have cap pal controls in place in a single currency union, is the euro already broken, in effect? >> yes. don't you think? for those people who thought about a northern and southern euro, right, that the euro would break in two? it's effectively already happening. what's one euro worth in cyprus versus one euro in germany. >> remember the capital controls they used to use in south africa, rand was worgd in the company versus rand outside? >> and "times" today comparing it to what you'd historically see in latin america. there is no end to these measures. some say they may be around until the economy finally
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recovers. >> next is slovenia. i did get up at 3:45 because i wanted to see the bank lines. there were no bank lines at 3:45. it wasn't like a justin bieber concert. it was less than a justin bieber concert. >> let's not forget, it is about half the size of palestinian, cyprus, in terms of the -- >> they have a ball club? >> i understand the significance within the eu. i don't mean to make light of that. >> we also go back to that incredible piece that was arrang arranged, between turkey and israel that the president arranged so it makes it that turkey's in the hunt for the natural gas. nbl is the way to play it. short-circuit gas problems, short-circuit the russians and make sure that you can stick it
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to the russians and still have a supply. >> i like global geopolitical intrigue! >> i like noble. >> i'd like a phone call! >> i need to make a couple of phone calls. >> you long the steven cohen house -- is that $1 million a day? >> i rent february. i tell you, prices out in the hamptons are really good. you get a couple of nice sunny days. water's a little cold, but come on. >> my 7-year-old loves 40 degree water. let's talk u.s. markets now. it is the final trading day of the first quarter that plongs to the bulls. the dow is up 10.9%. s&p 500 up 9.6%. and within three points of its all-time closing high. nasdaq is up almost 8%. the dow is set for its fourth consecutive month of gains with boeft s&p and nasdaq up for five straight months. yesterday's session was interesting because we flagged the turn in the financials early
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on and we did see that continue a little bit throughout the day and morgan stanley perhaps most tied, whether rightly or wrongly, to europe actually closed the day higher. >> it was another day for jpmorgan to spend some time in the penalty box. i don't want to be more severe than that because the madoff thing is very difficult to understand. if jpmorgan turned around and wells fargo turned around i think we'd have a different coloration for the day. wells still down from the 38 print the week before. jpmorgan looked like it was breaking out and is in a world of hurt. it is a world of hurt. >> it doesn't seem to have an end to them. the whale was behind them. put back litigation which is much more centered on b of a. >> jpmorgan is large across the
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banking industry but numbers in terms of litigation risk, you would think -- why take the chance there if you're an investor. >> verses some of these regional banks. lot of buzz about these fannie mae preferreds, they're up, they're done. some of the regioning a banks actually own those. it is a great story. some banks held on to the fannie mae preferred that got wiped out and it's now springing up and so these are just difficult things to value. but be aware that the regionals have a lot of wind at their backs right now. >> interesting take. yeah. some of the other stories we're following ahead of the opening bell. pinnacle food, the home of duncan hines, mrs. butterworth, bird's eye an other brand going public today, pricing $29 million shares. proxy advisory firm iss urging metro pcs shareholders to vote against a merger with
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t-mobile usa saying it would not provide them with the proper value they deserve. walmart's strategy to better compete with online giant amazon with a plan that executives say is in the very early stages. something we discussed on this show yesterday. >> what's the ceo of pbh saying about doing business with jcpenney? later on, jim rogers, what is he saying about the situation in sigh truss? where in the world is he putting his money now besides bow ties. futures this morning relatively mixed ahead of what will be an interesting session. final day of the week, trading day of the week, the month and the quarter. a lot more "squawk on the street" live from post nine in a minute. carfirmation. only hertz gives you a carfirmation. hey, this is challenger. i'll be waiting for you in stall 5. it confirms your reservation and the location your car is in, the moment you land. it's just another way you'll be traveling at the speedhertz.
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shares of pvh falling premarket. full year profit guidance is short of analyst consensus due to a draft in its acquisition of mornico. last night he was asked about doing business with jachlt c penny. >> i would describe with all business with penney's in two category. we have a dress shirt, next ware, classification business on the main floor, which you're wearing there. that portion of business is under a lot of pressure. down about 30% the last 12 months. >> that is -- >> cost us last year about $40 million. but our sportswear business is
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where we've opened the shop in shops, izod in particular, the eye dodd business is one of their best performing brands, performing on plan. >> i guess there are a couple of questions here first of all. your take on pvh with the shares down premarket based on its full-year guidance. but then also if you're more optimistic about jachcpenney. >> manny underestimated i think the difficulty, integration with calvin klein. there's a problem worldwide with jeans. they own some of the house of calvin. lot of people felt he didn't break this like tommy hilfiger where you had tremendous appreciation. plus march was not that good. that's weather related. as far as jcpenney if all they are doing is on plan for the store within a store and the rest is bad, it is still not enough to make me feel cozy about jc. >> interesting, too, wells takes
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down their valuation range for american eagle, air poe. >> flip-flops, shorts. manny did allude to the fact that tommy shorts, people are not in the mood when you get a degree day that's 20 degrees below last year. carl quintanilla wants to know aboutjcpenney. when you go to manny, you can ask him about jcpenney forever. he's obviously trying to distance himself. i think that's important to point out. nobody wants to talk about $40 million in lost sales because of jcpenney. it is a plaque hole versus macy's, versus these other chains. it is important to point that out. no one wants to go there sglp there is some guilt by association going on there. >> did you get a sense manny was just setting the bar really low
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so that he can move that away for the rest of the quarter and deliver on those -- i'm asking because jpmorgan said ahead of the quarter we're going to say pvh will take the bar low down to digest the warnerco acquisition. >> this is a reset. he reset it. i just hope 25 cents is enough. you need korea jeans market to turn around. you need u.s. jeans. you need to see europe stop going down for them. europe is still really good for tommy hilfiger. calvin is big in asia, big in latin america. it made a lot of sense to put these together but right now it looks like this is a year where you might have to be on hold for pvh. coming up next -- how can you end the quarter on a profitable note? cramer has some answers for you. and we are on ipo watch
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today. pinnacle foods says its products can be found in about 85% of u.s. households. how much of an appetite will will be? let's look at futures as we look to cap off the quarter. dow turned positive but looks like a loss on the s&p 500 at the open. much more straight ahead. with fidelity's new options platform, we've completely integrated every step of the process, making it easier to try filters and strategies... to get a list of equity options... evaluate them with our p&l calculator... and execute faster with our more intuitive trade ticket. i'm greg stevens and i helped create fidelity's options platform. it's one more innovative reason serious investors are choosing fidelity. now get 200 free trades when you open an account.
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few minutes before the bell as we wrap up this trading week.
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jim's "mad dash" is here. you love talking about companies with promising drugs. >> biogen reminds me of pfizer during the heydays of the '90s. big approval yesterday midday. fda, another ms drug. this is a 19-times earnings stock. it's growing at 18%. it is still cheap. >> jeffries raising the target on deckers. >> you want to make a splash? you raise your price target. did you see that? $65 goes to $100? the sheepskin has been a huge burden for costs for a long time for uggs. the cold weather man helped uggs' sale. this thing was down here, no one wanted it. suddenly jeffries, couple other firms said there's a real franchise here. there's a lot of people shorting it because they thought uggs was down.
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looks like uggs isn't done. the male uggs i have because of tom brady, it hasn't really made me feel like tom brady. i haven't been in brady's shoes, so to speak. >> i think your life is as charmed as brady's. >> you do? >> any day of the week. i do. when we come back, should you be hungry for bird's eye? mrs. paul's? vlasic? stick around to see how the stock opens for trading. zap technology.
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[ dog barks ] because right after they get married, they'll find some retirement people who are paid on salary, not commission. they'll get straightforward guidance and be able to focus on other things, like each other, which isn't rocket science. it's just common sense. from td ameritrade. you're watching cnbc's "squawk on the street." live from the financial capital of the world on a thursday morning. opening bell set to ring in less than a minute's time. we will wrap up the week, the month and the quarter. jim, year to date, s&p up 9.6% but it's health care and staples up 13% to 14%. people wondering whether that will remain in q2. >> transports have been strong, too. my problem with those particular stocks, the consumer product, is the dollar's gotten very weak and a lot of them are using a
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dollar number that's actually a little bit -- i mean verses the euro. these companies are having very big translation problems. >> technology only up four. there's the opening bell. pinnacle foods celebrating its ipo. ceo will join us in a few moments. over at the nasdaq, mld fan cave. >> it's opening day for the mets. your mets, david. >> my mets. >> and our yankees on monday. >> your yankees, my mets. okay. yes, we're hoping for one win this year. maybe it will come on opening day. >> for pitchers, they're looking at you, scouts are considering you. >> my arm has not done a lot of work lately so it is relatively
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fresh. i've been working on my knuckle ball. i can hit at least 55 on the radar gun. then my arm will fall off sglp take a look at what's moving. plaque berry is really the story of the morning. they beat on earnings with a 22 cent gain. revenue did miss but look at the at the cash position relatively steady. subscribership was off after the first-of decline last quarter. it was a tug-of-war -- >> but for now it is up 5% with record high short interest which could be x as baiting this to the up side. 30% of shares outstanding, record highs. as we are talking the stock is absolutely climbing. good one to watch here. on the flip side we are watching apple. some weakness. estimates cut so seeing a little
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bit of weakness in shares of apple. what's been leading this quarter higher, and this year, we're looking at these high dividend paying stocks. johnson & johnson, yet another all-time high right out of the gates. mccormick slightly higher today. costco, all-time high. >> these stocks are juggernauts. some people think they're being accumulated to show you own them this quarter because they were so visibly obvious. what could be more obvious than general mills? you're hoping someone comes in and pays 20 times earnings. it is the same earnings. >> how long does that game continue? >> that game has always been a not-great game in the end. 1987, that game was played all
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the way to 29 times earnings. so if you use an 87 parameter you still got room to run. >> lot of momentum. >> that was the japanese coming in every morning and buying stocks. the japanese use to come in this waves. they'd tell you, listen with be here's what we're buying. i think the europeans are coming in this waves, here's what we're buying. like i'm going to buy these companies, i'll buy kellogg because that's better than what i have in my country. >> they may be looking to buy some pinnacle. we think the open will happen in the next few moments. priced at $20. range was anywhere from $18 to $20. values it at $2.3 billion. post eight is going to be -- >> this plays right into what you were talking about in terms of general mills and kellogg. this is one of the stocks promising a difficult dnd.
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at the mid point of the range it was a dividend yield of 3.8%. given the indications we have, it is $21 to $23 a share. dividend payer. it is in the wheelhouse of the buffett kind of acquisition that can be made with heinz. >> it was an exit -- we talk a lot about the entrance of the private equity firms being buying a new company but believe me, they're very much focused on exits. it is going to be still about five times in terms of debt. leverage five times. which is a lot. >> b and g foods, trades at 2.5 times trailing sales. pinnacle, even if it trades at .9 times trailing sales if it opens around here. let's give it 1.5 and you got a
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gainer of 30%. i'll give you the sales side, you give me the risk side. >> a lot of debt, if there was a significant slowdown, their debt payments are fairly significant. not much of a concern for investors. >> s&p points out year to date, u.s. ipos have raised $10.25 billion. same time a year ago, year to date, was only $6.4 billion. so we're up 58% in terms of dollars raised in ipos in this country sglp that's interesting. because it really picked up in the last few weeks. end of the quarter. this pinnacle i think is important to point out. this is the kind of company that i think -- it's very rare that i want to say you shall go buy something because so many of these have been very thin float and monstrously overvalued on a basis of social to mobile to internet. right? this is duncan hines. my mom didn't like duncan hines. she always liked to make it from scratch. you go to a lot of birthday
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parties and the moms are making -- >> tasted pretty good. >> blackstone, good track record in the first day of gains. 13 deals generated deals of 40%. so far this year, not bad, betting along with the private equity firms who were exiting. >> at 1,560.09 on the s&p we are essentially -- you can't get any closer to the closing record. 1,565.15. so just a sliver of a point away. but that would mark another return to an all-time high. interestingly, "the new yorker" had a good piece a while allege about how after the crash of '29 it took 25 years for the dow to reclaim an all-time high. after had this most recent crisis, five years. mostly due to policy sg. >> yes.
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we're reaching for 3%. 3% is nothing! >> in this environment it's great. >> right. it's something to hang your hat on. >> not great for somebody living on a fixed income. we've got two things going on -- old people who can't get a return on their investment but they are benefiting of this huge transfer of wealth from young people to them because of entitlements so it all works out. >> there is a cohort of this market, you go back and look at 2007 and it is the financials and they are nowhere. they are nowhere versus 2007. >> let's check in with bob pisani who i'm guessing is somewhere in this crowd for pinnacle foods. >> i'm here with family and friends of pinnacle foods. $22 what we're looking at. priced at $20. big thing here, people ask me what the average insiders -- $8.19 here. little higher than. some of the other names recently. mixed reaction to some of the
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food names. annie's had had a fabulous time. they priced last year. $19. opened at $31. last i checked they were $38 and change. there was a really big success here. right now looking $22. should been five minutes here. if you see all the calm over in cyprus? i was amazed and astonished there wasn't a sense of panic there. guess people are impressed and i guess that's good news. moody's had an interesting point about all the calm in europe in general this week. they had a very good point -- they said the muted reaction to what's going on in cyprus may embolden policymakers. in other words, there's no panic there so now they feel okay, we might be able to get bail-ins, including depositors elsewhere in europe. i think that's a very good point and people ought to be a little bit worried about that. there's no panic anywhere in europe.
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no big woerdz thrries that ital form a government. one thing that did happen, there is a panic in european bank stocks. they're down 20%. some of the stocks -- this is just the month. 20% in commerzbank, germany, and not just southern european banks. they're not down as much in the north but they're still down considerably. the key take-away right now seems to be everybody's recalibrating bank valuations and the euro bailout creditors suffering fatigue. my take on this is that the calm is not necessarily very reassuring. moody's said that all of this calm out there and the confidence that they can contain this and not have contagion might be misplaced. they specifically used the word misplaced. the u.s. is the place to be,
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folks. good heavens. once again the s&p 500, world leader, up 5%. only other country youtperformig us in the market is japan. the bank of japan is meeting next week. that will be the first time of the new head of the bank of japan will preside over a meeting. but japan up 18%. spain, brazil, china, though, other big markets, all to the downside. right now, still $22 on pinnacle foods. let's shift to the bond and dollar. rick santelli at the cme group in chicago. >> i totally agree with bob pisani, the sit yachts acypriot pretty classy. if we look at intraday, we've moved up a bit but a two-day
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chart maybe gives you more symmetry. we still haven't made up the ground of the drop yesterday. if you open it up to year to date chart you can clearly see. if you were going to define a range knowing we settled at 1.76 last year. we got close to an intraday yesterday. let's switch gears to over sovereigns. year to date of bund, they closed 1.38 last week. here they hover at 1.27. similar to the 10-year note yields. they they moved up a bit from some of the lower intradays from yesterday but still not reflecting -- just because the cypriots are well behaved doesn't mean that everything is foredon't. if we look at a year to date of the jgbs, this is the most popular chart on the floor -- 51 basis points. if you look at spanish 10-year, they moderate of their yield increase but still hovering at
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5.10. euro versus the dollar, definitely making up ground today. but still 1.28 is a low level. we have a very exciting morning shaping up here post nine of the floor of the new york stock exchange. in case you missed this, 1,565.09 is where the s&p hit today, just .06 away from its all-time record -- >> i think we got to .14. from what i'm told. >> i don't see it on nye screen. >> doesn't get any closer, no matter how you slice it. >> we got to get this over with. looking at april. april's usually a good month. people want to say sell in may. then they want to get ahead in april. maybe it does take to april to get to where we have to be. i think there's too many people who need to get out because of
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the valuations. they want to nail down this quarter. i don't blame anyone for wanting to nape down a 9%, 10% quarter. >> that's a whole year's gain tore some people! >> yes! we've seen that! i remember in 1990 you had an incredible gain in the first month. lot of people just went home. >> why is it that the dow when it's up 8% plus in q1 ends the year positive 100% of the time? >> we have seen some breakdowns that suggest it doesn't necessarily get stronger. only has to go up a little bit. i can tell you in the old hedge fund days, know what i would do? we used to have interest rates 4%, 5%. you book it and kind of day trade and you have the cash earning four and you end up with an even better quarter at the end of the year. we obviously have very low interest rates so you can't play that game. >> seasonality, plus the sell in may, plus some argue the likes of a ge diverging with the dow, not confirming the rally.
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>> or copper, for that matter. >> aluminum. >> yeah. >> i've been watching alcoa. you could say that stock never breaks down. you could say that stock's completely flatlined. some of the industrials are like that. freeport? i just don't see anything happening. then he turn to the transports. look at these rails! the rails are on fire! and a lot of that is because of bachen oil. a lot of it is because chemicals are very good. the coal trade has come back. >> you're not saying it is a given that we're in for a period of near-term weakness. are you? >> no. no. i just think there's some great stocks but we need to rotate to the finances. this rotation thing, why i talk about that is because we need to see some commercial real estate growth. we need to see housing -- i'm a big bull in housing but the numbers weren't that good yesterday. need to see better. >> red hat getting clobbered
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today because earnings came in at the low end of its guidance. even though the ceo's saying there is momentum. you did see momentum continue in the quarter. we had positive bookings. >> whitehurst -- he used to be ceo at delta. a ceo of an airline is the toughest job in the world. people are making a case for intel is. you know what the case for intel is? hasn't done anything. >> i think santelli is in chicago. >> oh, wow, this is a surprise. we were expecting 56.50. 52.4. this comes off of 56.8 which was the best basically in 11 months for march of last year. 52.4 doesn't fit in well. remember, we had last fall those numbers originally released under 50. then they benchmark proigsz put them slightly over 50.
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then december came in smack-on at 50. so this kind of fits in right there. a bit of a disappointment to be sure. but keep in mind that this number is still above 50 and we'll through the internals and continue to monitor those throughout the day. >> thank you, rick. . new orders were 60 in february, jim. 53 now. you mentioned housing. funny, you just finished saying housing numbers weren't as well as they could be. claims today? >> yeah. look, nanny treat referencing march was kind of a weird month. i don't like to think the economy is decelerating. i think china is decelerating. obviously europe is tired. i'd like to see a little stronger numbers here but it does make you realize why the fed is still accommodative. these are not great numbers. >> china meanwhile you say is decelerating. >> i think it is. >> shanghai index down 5.74%
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this month. >> talk about banking problems. right? i mean their banks -- no, thank you. slovenia -- cyprus, beijing. don't like the banks there. don't like that stock market at all. spl we a >> we're in the red across the board. pinnacle just opened for trade. it is up by 12%. up by 12% for pinnacle. a price at $20. it is trading right now at $22.43. third biggest ipo of the year. looks like a dividend yield north 36.8%. it competes right in the sweet spot of this market in terms of defensives, staples, names, payout, good quarterly dividend. >> yes. that's what people want. the more you try to figure out how clorox got to where it is. you remember what carl icahn did for clorox? he realized it was hard to do better? what was he trying to do. you know where that stock is?
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he did it with calls. >> he buys at the money calls to a large extent but whether it was a real bad -- the financing and everything else is still a question mark. >> what a remarkable run. let's check in with bob who's in the midst of the crowd of people. >> bob denbar, this guy ran major league baseball a while ago. $22.26 is what we opened at. the stock priced at $20. it was the high end of the range so a nice open here. talking maker vlasic pickles, aunt jemima, bird's eye. all people standing around here, a lot of blackstone guys, lot of family members. just a really nice group of people here. a lot of them long-time employees of the various companies that have been owned or acquired by pinnacle food
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over the many years. bob's coming right over here. this is what we do here, have this great organization set up so that people can come, make that first trade, and turn around and go talk with the guys over here. it is all set up for you, the audience, to learn something about what's going on. $22.40 right now for pinnacle foods. >> thank you, bob pisani. as bob mentioned, pinnacle foods off to a very stropg start in today's session, up by 12%. the ceo will join us at post nine next. recognize me.
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pinnacle foods debuting here at nyse today, up by 1.5%. 20 -- 1 1.5%. bob, great to see you. congratulations. >> thank you. it is really great to be here. >> what role did the timing play in all this in that right now the market right now appreciates, staples names and ones that pay out a nice handsome dividend and you are promising north of 3.8% annual
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yield sglp yeah. just the ipo process is one that takes a very long time. we've been working on this for more than a year. i think it is a trend that's been around for a long time where people are looking for stocks that are stable. they can perform well or businesses that are stable that can perform well and even challenge economic times and one that guarantee a dividend out there to give the investor a reason to really play. this has been in the works for quite a while. >> 3.8% is higher than the average yield on the s&p which is 2.2%. it is up there with a lot of your competitors. did you look at what your competitors are paying out and think we got to at least match that? yenl mills is 3.1%. conagra is 2.8%. >> i think dividends are part of the attraction of the sector but really that dividend payment is reflective of the incredible free cash flow we have in this had company so we can pay a 3.8 dividend yield and have a tremendous amount of cash flow to invest in a company, to pay
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down any doubt to pursue m and a. i think that level just shows how much cash flow the businesses we built to generate. >> you worked at mars. i know you got the big scope. is it bird's eye you want to extend, freezer case, going after another company in pizza where you buy california pizza kitchen? what is the plan? because p&g food has told me there isn't thatch for sale right now. >> the first thing to emphasize, jim, is that the offer that we have here is really a great organic growth story. because of our line of sight to margin improvement, because of our great free cash flow we built a business that can deliver great shareholder return even in a low growth environment that we have right now. i see m and a as the upside to our core case. we're a top five frozen player right now. there are a lot of opportunities to build our position, both in frozen and dry, and the amount of synergies that we can generate if we plug in a frozen
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business into this efficient business model are tremendous. so lots of candidates out there without getting anything specific but we're excited about the frozen side of the portfolio. >> mrs. paul's, the hungry man, not necessarily organic and thin. what is your anti-obese line? >> well, two things. you are not talking about the number one brand in our portfolio, which is bird's eye, which i would argue is the ultimate health and wellness brand, selling value-added veg animals etables is as good as it gets. we've also taken our -- all the rest of our line and looked at where we can improve it. we've introduced log cabin all natural. we've taken high-fructose corn syrup.
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vlasic and a high-end pickle. all natural ingredients, whole cloves of garlic. so the trend of natural, simple ingredients is here to stay so we'll do it by expanding bird's eye -- >> mrs. butterworth's still has high-fructose corn syrup. >> it does. you got to offer something for everybody. we offer choice. >> plaqblackstone still a significant owner. give us -- >> i partner with plaqblackston 2009. i think it is a great example of a private equity firm doing the right things under private ownership to make us a company ready to go public. >> what do they do? >> big infrastructure investments. allowed us to clean up our portfolio. built the management team. these are things that are really hard to do when you're a public
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company and you're worried about your top line sales. some of our top line sales look flat. we've been intentionally working down the lowest margin part of our portfolio to get ready to take this company public. that's to me a great study of what can happen when you're under private ownership to build a business that's ready to go public which was always our intention. that's why we're excited to be here today. >> but they're going to sell stock along the way. >> blackstone is selling no shares at this time. we're all locked up for a minimum of 180 days but they've been an incredibly patient investor. they put equity in at the original investment. they put more equity in in the bird's eye end of this acquisition. this is just the next journey for us and blackstone's holding on to their shares. we're thrilled to be partners with them. >> i don't even need to ask what these are made of. >> this is one of our new items. this is a red velvet decadent
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cupcake. melissa asked if i baked them. this is part of our duncan hines decadent line. you can bake a whole box of red c devil cupcakes. >> i have orders for cucumbers and pickles. it's called cramer's none better. you better get used to it. >> thanks. time for six in 60. jim, what are we starting with? >> we're going to overtuning. i don't want to see so too many secondarie secondaries. i didn't like the last quarter. >> citi. raising the target for zillow. >> people want to play real estate. i don't plame them.
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>> us airways. >> lcc. this is my favorite airways. it's going much higher. >> steeple raising the target for kraft. >> i did that because we've got bob on and kraft is pinnacle. >> bernstein likes micron. >> they made an acquisition. it is working. >> dollar general pricing sector. >> you know what? everyone's worked on these dollar generals. i think you should be in it. >> few second to spare then. what's coming up tonight? >> we have paychecks. that's a very good gauge about whether people are hiring. then i got an old friend, fred hassan. this had guy is the turnaround par excellence. he's chairman of avon now. i think the main focus will be can they inject this kind of culture that he has at the companies that he ksh he's also
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worked at boush and laum.
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♪ let's get to the road map for the next hour. blackberry defying all the pessimism on the street posting a surprise profit in the quarter. stock seeing violent swings today as investors digest the news. we'll sort through all of it, the z-10 shipments, and whether or not the bottom is in for the stock. from blackberry to the markets. the rally that just won't stop. s&p within a fraction of its all-time closing high. it's pinnacle foods' first day of trade at the big board. first let's get back to one of the big stories heading into the long weekend, the banks finally reopening in cyprus after being closed for basically two weeks. enforcing strict capital controls enforced to prevent
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money from leaving the country. michelle caruso-cabrera is live with the latest. this is a fascinating situation because in a world of internet banking and wire transfers, a run on a bank may not appear quite as it does. >> reporter: no. you're absolutely right, simon. at the same time it's a lot easier in this electronic world to actually impose controls on those wire transfers which is exactly what they've done. there are physical withdrawal limits but there's also limits on wire transfers as well. for example, people who have shown up here because they wanted to take out money, they were told no more than 300 euros per day. if you're a business owner you can do transactions up to 5,000 euros. however, if you want to do more than that, between 5,000 and 500,000 euros, you have to present your paperwork to the bank, get permission in order to
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do a transaction, pay for your suppliers, et cetera. when we saw people here withdrawing money at the same time we found a number of business people here who were depositing money. for example, a pharmacist here. >> i came to deposit checks so i will be able to pay my employees. they are going to get late checks. but there's nothing that i can do. >> reporter: there are no limits on payroll. if you're a business owner who wants to process payroll you can process payroll to the end of time because they want people to get paid. that's one of the restrictions that they do. that's very, very loose. you want to travel outside the country, only 1,000 euros per person per trip. this is the first time in the history of the eurozone that you see capital controls which in theory are supposed to be illegal. highly lly embarrassing situat.
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many believe this could be the beginning of the end or at least the fraying of the european union or eurozone and whether or not we are really going to see this currency survive. >> yet in the meantime, michelle, is it fair to say that the situation as you go into now a four-day weekend if cyprus and the rest of europe, the situation is contained and calm? >> it's certainly calm here. but remember if you can't withdraw more than 300 euros per day, if your mission was to try to empty ot your bank account and keep that money in your mattress, you can't. right? that's why they did that. they wanted to prevent runs on the banks. it is hard to know what the true demand and feeling is at this point. we haven't seen contagion in the rest of the european union. it could be because people see the situation somewhat uniquely because the banks here are just so large relative to the size of the economy. and if you had some kind of bank
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explosion in italy or spain you're not going to go nearly that deep. have to go deep into the capital structure to have to pay for it. there may be some ability by the population to distinguish that. i'm not so sure. but we'll see. >> phenomenal reporting over the last two weeks, michelle. have a safe journey back. from cyprus to the talk of the tech world. popul blackberry is trading higher today by 3.33%. we should note that you have an underperform rating on the stock with a price target of $10 a share. but there was up side to this quarter. what was your overall take? better than you expect sfd. >> yeah. i think the results themselves deserve applauding. revenues that were light of expectations but the company glimmered a very high-gross margin which is a closely followed metric. the company also delivered their
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first profit in 12 months. question mark we'd have is about sustainability of these results going forward. we see several risks ahead. >> i want to talk to the about the sustainability aspect of it. what was somewhat disappointing was decline in subscribers. third quarter was 79 million. first quarter was 80 million. they expect a single digit decline in subscriber base in the current quarter so yet another sequential decline. how many subscribers can this company -- >> that's the reason we downgraded the stock to underperform a month ago. 5% of the entire subscriber base left the plaque berry platform this quarter even knowing that a new product is coming out. that means they either don't see as desirable or they're not enthused about it.
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our concern is not only will the subscribers decline but the actual users go down as well. last year they probably had an 85% gross margin. we think that's going to drop by almost 40% in the next 12 months. problem that creates, blackberry's the only hand set company that has these services fees. we think over the longer term they are going to weigh. we feel you can't afford to hemorrhage any more subscribers. we think that has to do with the competitiveness of the newer products. >> headline figures as i understand it may be worse than they appear. this morning our attention was drawn to the fact that they have a broader definition of what a subscriber actually is.
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they broaden the definition and still the numbers look weaker than many people hoped for. what about this issue that they account for the phones on a cell-in basis. if the suppliers don't sell, there is a take-back on that further down the line and the margins could look a lot worse as a result. >> yeah. that's one of the risks as well. bottom line is they had overall -- they sole one million plaque berry ten units in the last quarter but only two-third to three-quarters of them actually sold through. the concern that we would have is that if you don't have very good sell through you go through a discounting cycle afterward to clear the inventory. that's why even the gross margin that produced this quarter 40% may not be sustainable. in fact nokia last year when launching their windows products saw a very similar issue. initially gross margins looked good but ult lei matly if it doesn't sell sustain play, you have to discount margins go
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down. this is why the company can go back to a loss over the next 12 to 18 months. >> how does the cash stay the same quarter on quarter when the company goes through a product launch? how do they manage that when fees pli they're spending money to launch the z-10? >> i think what they've got right now is improvement in profitability. the next quarter they'll make or break even. they'll take marketing up by 50% but the higher level of profitability they've got now allows them to do that without losing money. fast forward two quarters out. suppose margins start going back down, down to the previous question about selling and you have to keep marketing spend very high because the carriers won't support it. then cash build can start again. you combine that with a time when the services fee will start dropping quite rapidly and cash becomes a concern over the next
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12 months. >> we will see a cash burn over the next 12 months. that will be apparent in the balance sheet. >> we think so, yeah. >> thanks so much for your time, we appreciate it. i wanted to talk a bit about metro pcs. as our viewers know, shareholder vote april 12th on t-mobile's deal to acquire metro pcs. still awaits. yesterday we got word say iing some were advising against it. they have been arguing that too much debt is being placed on the combined company, that the ownership structure in which deutsche telecom would own 74% of the combination is too high given the economic contribution that comes from pcs, that the interest rate on the debt that
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would be put on the entity would be too high. that deutsche com's ability to sell shares immediately is in question. there is concern the interest rate on the debt and the debt itself should be lower. suffice it to say the opposition to the potential deal is quite significant. i've been trying this morning and succeeding to a certain extent in speaking to people close to deutsche telecom. according to a number of people i'm speaking to -- posturing goes on here without a doubt but there does seem to be a line of spinking at deutsche telecom questioning whether or not it is reasonable on their part to try to raise their offer, raise the overall consideration in a variety of ways to meet shareholder objections to get that vote on april 12th. they are having thoughts at least at this point, perhaps more than people would have thought. culturally, deutsche telecom, very different than the u.s. company. they've already been once burned
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though when they tried to merge t-mobile with at&t or have at&t buy t-mobile and it was turned down by antiregulators here in the united states. one would argue they really need the pcs deal to happen. from what i'm hearing because they feel emboldened strategically a bit at t-mobile and they also feel the antitrust risk of an ultimate deal with sprint has lessoned, they may be willing to forego trying to raise the consideration here and simply take on the shareholder vote as is likely to lose that vote. this is an interesting situation, one that we're going to be following closely over the next couple of weeks before that shareholder vote but as opposed to what i might have anticipated being, yeah, we're working on improving this consideration overall, there does seem to be at least back-and-forth about the idea whether or not that is the best route to go down. sprint had spoken to t-mobile about a potential deal when it was also talking with soft bank. there had been conversations. i reported previously it is in the merger agreement as well,
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background of the mernler. but the three had been considering the deal. there potential interest in t-mobile? of course there would be down the road but many people believe you need a strong number three competitor if you're ever going to compete with the likes of verizon and at&t. if this deal gets voted out and pcs is out there, you have to wonder about clearwire. we have a lot going on with these shareholders and what they want versus what the potential buyers are willing to pay. >> he's still a man though. >> always. >> walmart considering a plan that would have store customers deliver packages to onloon buyers in the hopes of better competing with amazon. walmart hopes to essentially tap into crowd sourcing to deliver their goods in a faster way.
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if walmart's customer to customer delivery plan goes through, what could possibly go wrong? >> where do we begin? we only have 140 characters for this. >> tweet us at squawkstreet. what would be wrong with me bringing package to my house? >> i don't want some stranger carrying my package. >> it's carl! >> it's probably more dangerousfy bring it over. >> monday is april fools' day. right? i would have thought this story was -- >> a joke. >> exactly. >> -- more appropriate for monday. >> it is free labor. >> it is about galvanizing local communities. you can see it working. it is the fm trading day of the quarter. account bulls continue their run? bob doll gives us his take when we come back. plus pinnacle foods kicking off the first day of trade as a public company moments ago. spoke with the ceo in the last hour but with recent consolidation in the sector
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could pinnacle soon become the next takeover target? a deeper dive into its valuation and their competition straight ahead.
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s&p came within .06 points of reaching its all-time high mark. are we due for a correction? maybe overdue? bob doll is chief equity strategist for nuveen asset management down here at post nine for the first time. we keep hearing this notion bull market has more to go but it is time for some retracement. how much? >> it is unbelievable how long this has gone on without much after pull-back. in fact the month of marnl has been 1,550 s&p plus or minus 1% almost every day. we're kind of stuck in this consolidation period. look, we're going to correct at some point. it always happens. but the important point is the economy is getting better, the fed is in our court, earnings are going to be okay. the stock market is going to go higher. >> we've had opportunities to sell off. italian elections. cyprus. today with chicago pmi.
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worst number since '09 but people want to buy that dip. why should that appetite to buy on discount end? >> i don't think it will. therefore when we get a pull-back, there's some people on the sidelines, therefore i don't think it will be much of one. it will be fairly shal dlowshal. watch, i'll eat my words. the market is volatile. penalty you pay to get a higher return is keep your seatbelt on and shoulder harness. >> how do cyclicals act. this sort of correction from here versus defenses? >> it is curious that what's led the rally is more the defensive side. i think the same thing for cyclicals in a strak songe sort way. because the u.s. global economy doing a bit better. >> how do you explain this rally that we've had in bonds that's
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taken the ten-year yield quite dramatically down to 1.85? >> very good point. i think the story until this recent move has been deflation threats are lessening. therefore, stocks go up and interest rates go up. but what's happened in the last few days is we've gotten this retest of deflation. the cyprus thing i think the main reason, but some other areas of weakness around the world. i think we've got a little bit of this deflation threat again. don't forget we're still interest rates above where we started the year. interest rates -- >> as we sit on $1,600 for gold, where do you think that will go? >> i think gold -- if the world continues to heal, the u.s. continues to do better than most places, dollar continues to rise, i don't think that's an environment where we can expect a whole lot from gold. gold, is a commodity, it bounces all over the place but i think it is fairly trendless. >> if you were plotting your q2 strategy from home would you be targeting the components that --
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caterpillar and alcoa, only dow components down year to date. >> they'd be higher on the list. those two you pick out have had some issues around earnings. but cyclicals in general i would look to buy them. if not here, at least on weakness. i'd be a dollar cost averager into the market -- >> would you sell the humanas to general mills? there's also the d.c. risk. we're not out of the sequester fiasco completely. >> correct. so we have the debt ceiling. we got past the march 1st sequester. continuing resolution. the shut down of the government was supposed to be this week. washington's less of a liability than it was. >> finally, is it important to you that we crack this all-time high on the s&p or do you want to see a decisive break-out? >> it would be nice to have the decisive -- look, in my view because the economy is okay,
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we're going to go through it. we just don't know which day, which hour. we'll look back and say, well there it was. >> bob, nice to have you back. this week on cnbc we're zeroing in on different housing markets across the country. today we're giving you a snapshot of how houston's real estate is doing which we're told is actually booming. a real estate agent working for remax joins us from texas. how is the housing market in texas? >> the housing market in texas is doing wonderful. we've seen such an increase since the beginning of the year over last year's production and last year's production was phenomenal. >> okay. let's look at some of the houses that you've got. beginning with your most expensive property which is listing at just over $2 million. >> that's correct. we have that property listed in avalon at seven meadows. it has a fantastic view of the
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lake. it's a usable lake where you can have low power boats and fish off of the pier. it's a gated community and we expect to see that property sell very close to list price. from how long has it been on the market? how quickly are you churning contracts at the moment? >> the difference in the properties is our higher enproperties will take just a little bit longer to sell. our mid range properties we are seeing fly off the market. we're having bidding wars on some of our properties and that property will probably sell within the next 30 to 45 days. >> in large meadows you've had 14 offers for this one. is that right? >> that is correct. we currently have it under contract. it sold or is on contract for 12% above our list price and we still have interest in the property and are taking offers to hold on the side.
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>> for a new yorker, it is extraordinary that that's selling at around $300,000. let's move on and look at another cool property listing. 895. >> the property there is a very unique product. it is over in the heights. it is a bungalow revival home where they have tried to maintain some of the historic value of the home. so the builder actually took the original structure, moved it from one location to another, tried to maintain the period of the property, and had to hold with the historic guidelines of that area. we currently have that one lists for $895,000. we expect to get quite close to our list price on that property as well. >> so as you look forward, what have you most got your eye on? is it interest rates? is it the desire to rent and whether people continue in that vein? what as realtors do you talk
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about? >> we talk about the interest rates an how they've increased the amount of people that we have seen in our market but we also are talking about the economic development that we are seeing going on in the greater houston area and it is not specific to one area. we have current companies that are expanding. we have new businesses that are coming in to the area. it just makes for a well rounded environment. >> i was going to wish you a happy long weekend but i guess you guys are showing through the weekend so not much of a holiday. thank you for joining us from remax in texas. have a great weekend, nonetheless. let's take a look at the s&p 500. once again we came within just a whisper of its record all-time closing high, 1,565.09 was as close as we can get in today's session. we've been trading a very, very tight range, within about a four-point range on the s&p for the entire day. we did see energy turn to the
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green. we're seeing technology make a push for the green as well. this is something we will be closely watching throughout this hour here on cnbc. last call for q1. talking your best ways to position for q1. we have your top sector plays ahead. plus global investor jim rogers on the cyprus contagion fears. the fed and the market value that just won't stop. back in two. a talking car. but i'll tell you what impresses me. a talking train.
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a very bullish number from
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the energy department on natural gas storage levels. here at the nymex natural gas rallying above $4.10 after the energy department reported that in the last week natural gas supplies fell by 95 billion cubic feet. by 95 billion cubic feet. keep in mind normally this time of year we see a build, an increase in natural gas storage levels and we also have seen that for the five-year average. so we are looking at a very bullish report here on natural gas supplies. that is helping this rally. we can see overnight high of $4.12 and we seem to be trying to approach that level once again after those numbers come out. i'm joined by cindy wexler, a trader on the nymex floor. a year ago we were talking about natural gas when we thought it was at $2 and you thought maybe it would go to a dollar because there would be no place to put all that gas out there. what's changed? >> i think we're down 20% with storage last year.
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they cut prot shun. they switched over from natural gas to pro december electricity from coal. we had an extremely cold winter that's extending into the spring. >> we broke through the $4 level and now is the sky the limit, what do you see here technically in terms of natural gas prices? >> once we broke above $3.61 that turned this market into a bullish break-out. we've seen record volume and record open interest. a lot of new loans angs are com into the market, squeezing out some of the shorts. >> normally this time of year in the spring we see natural gas prices sell off. so do you think fundamentally there's still a lot of natural gas out there. is this really -- rally really supported by fundamentals? >> it really isn't supported by fundamentals. even though we still have plenty of natural gas out there, we're still well above the five-year average.
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$4.20 on the up side, that should be about it. then we shall turn around. >> cindy wexler joining me on the floor. near $4.10 for natural gas prices after that bullish report. about an hour into trading, some of the stories we're squawking about, biogen rising 4%. the fda approving the biotech firm's new oral treatment for ms. signs of a slowdown in midwest manufacturing. the chicago pmi coming in weaker than expected falling 4 1/2 points in march. freddie mac says the average rate for the 30-year fixed edged to $3.57. if my eyes don't deceive me -- >> we have crossed an important milestone here for the s&p -- >> 1,565.40, the high of the day, the high for the past 52 weeks and above the all-time closing high level. if we close at these levels --
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we're just below right now -- we'd be closing at a fresh all-time high. >> thank goodness it is over. we finally cracked it. >> yeah. we cracked it. >> adjusted for inflation. right? not the intraday high. >> it's true, all that. >> there is an animation that says "s&p all-time high." it's been a week during which the traders at the nyse have been able to shine. another big day today for ipos, for the launching of stock on the big board. pinnacle foods of course trading now at the nyse. let's head over to bob who's been watching all the action within the last hour. >> remember we have to close offense the 1,565 with the s&p to make it official. good day for pinnacle food. this was packed with plaquestbl and pinnacle foods people. we priced 29 million shares at $20 and interestingly, that's
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about 26% of the flow to the company. that's on the high side. a lot of these ipos, they float 15%, 15% of the company. insiders own it at an average price of $8.19. that's a little bit on the high side. this is the fourth food ipo we've had in less than a year. annie's has been a monster, opened at $31.11. that was a year ago. now it is $38. they have a couple secondaries on top of that. white wave priced in october at $17. it is still about $17. bottom line is at $22.54, average insider own it at $8.19, not bad. a 200% profit there. most of them are restricted right now but eventually they'll be able to sell.
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back to you. >> we spoke with the pinnacle foods' ceo just a while ago about the timing of his company's public debut. >> we've been working on this for more than a year. so it is -- i think it is a trend that's been around for a long time where people are looking for stocks that are stable, they can perform well -- or businesses that are stable that can perform well and even challenge economic times and one that guarantee a dividend out there to give the investor a reason to really play. >> right now pinnacle shares are up by 12% 6% after pricing at the high end of the range, $20 a share. as everyone in the world is tweeting about the s&p crack in the high, we'll have more on that this afternoon. shares of zillow surging near new highs as the housing turnaround gains more steam. we'll have a "squawk on the
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street" exclusive a little bit later on.
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take you back to october 9th of 2007 when the s&p closed at 1,565.15. we have not been above that level since the 11th of that month. finally did it today with some room to spare. >> 1,565.46, the level we are sitting at right now. but of course intraday level we are looking at 1,576.09. so something else to look forward to today, possibly. in the meantime, banks in cyprus are opening for the first time today in nearly two weeks. customers as we've been reporting do have access to their money but there are very strict restrictions. paul dan vonovan joins us live london. before we dive into what's happening in europe, how account s&p 500 reach these levels when the situation seems so dire for
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cyprus? >> well, largely because as far as most american listed companies are concerned, cyprus is about as close to irrelevant as you're likely to get. american companies that are listed on the s&p are global companies. they are companies that are selling all over the world. cyprus may well be part of that but i would venture to suggest it is not a very large part of their market. >> if you're saying that then i assume you done think that cyprus is systemic to the rest of the eurozone. >> yes and no, if i can give the official economic term, sir. it's not i think going to suddenly trigger problems elsewhere in the eurozone. that i think is quite unlikely at this stage. the risk i think that we have is that if there is a future crisis somewhere in the eurozone caused for whatever roon, then teason, memory of what happened in cyprus will make the cost and
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severity and speed of that crisis more dramatic. >> what is your view on italy. today the economy minister had to deny that he was aware of an imminent moody's downgrade. if, for example, moody's tonight cuts italy to one notch above junk status, what does that mean in anything? >> well, i'm afraid to say i don't think the credit rating agencies means anything ever anymore. i mean they are about as irrelevant an institution as you can get these days. >> surely a sovereign that's cut to junk, if it is such a bad -- if it is such a big market as italy is, is an issue. >> well, it's only an issue if you believe the credit rating agencies know what they're doing. i have yet to find an investor who believes that. i think what would happen is that there would be continued focus on domestic support for the italian market and of course italy is a bond market that has very long duration on its debt
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an which has generally speaking a very high instance of domestic ownership. domestic owners are not going to be unsettled by what any of the credit rating agencies say and the long duration of debt means that the italian government will chug along continuing to refinance itself as a general rule. >> as we head into the weekend, paul, what in essence is your advice to investors? >> i think we're not just heading into a holiday weekend of course. it is also the end of korfa. nobody wants to take big risks, nobody wants to take big positions. as we come back next week people are going to sit down and reassess at the start of a new quarter, at the start of in some countries of a new fiscal year, where they want to be putting their money. i doubt europe is going to be considered as being amongst the first choice of locations for many investors' money. >> paul, have a great weekend.
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paul donovan. lot more coverage of the markets on this record setting day for the s&p as it finally returns to those previous record closing highs. plus a side of rick santelli on budgets, debt and interest rate expenses. back in a couple of minutes. suddenly, she does something unexpected and you see the woman you fell in love with. she's everything to you. but your erectile dysfunction - that could be a question of blood flow. cialis tadalafil for daily use helps you be ready anytime the moment's right. you can be more confident in your ability to be ready. and the same cialis is the only daily ed tablet approved to treat ed and symptoms of bph, like needing to go frequently or urgently. tell your doctor about all your medical conditions and medications, and ask if your heart is healthy enough for sexual activity. do not take cialis if you take nitrates for chest pain, as this may cause an unsafe drop in blood pressure. do not drink alcohol in excess with cialis. side effects may include headache, upset stomach, delayed backache or muscle ache. to avoid long-term injury, seek immediate medical help for an erection lasting more than four hours. if you have any sudden decrease or loss in hearing or vision,
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welcome back. the s&p finally did it, we crossed above the level of the all-time closing high. we have held above that level as well. 1,565.47 is where we are now. there wasn't any confetti on the floor. was it an exciting level for you? >> industry veterans have seen these kinds of of things in the past. listen, it is as unimpressive an impressive number as can be. volume seems to be muted. no sense of dpglee, not like it was when we passed 10,000 the first time. >> today's session like many other sessions and like the whole entire year for that matter has been built on the gains and new highs for things like health care, for names like johnson & johnson, bristol meyers, general mills. these are defensive names, they're not materials, they're not technology.
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>> on the other hand though, fact of the matter, are you talking s&p. that's a pretty broad metric right now. you have to give this market its due. nonetheless with the volume being muted here today and trading not that much alacrity in the trading. we'll have the end of the quarter liquidity events so it will get busy. generally it is muted during the day and gets very active near the end of the day. but they won't sell them on the last day of the quarter. that's not the way the game is played these days. >> we have a lot of events next week overseas. we'll continue to watch the cyprus fallout and whether or not the bank lines continue but also bank of gentleman man meets next week. this could be a huge factor in the floebl markets. >> it could be but actually at this point guys are saying that the business to be is in mints.
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i think everybody's sort of staying the same course globally, whether japan or whether it is here. guys are sort of playing this game from the government stimulus standpoint. i think we'll see that in japan. >> thank you. have a great weekend. let's get to the cme this morning, check in with rick santelli. get "the santelli exchange" for a thursday. >> hi, carl! well, you know baseball. baseball players hit 5 out of 10 or 50 out of 100, they're batting .500. obviously that's unbelievably terrific. in baseball if you're doing 3 for 10 you're doing pretty well at .300. but i have to admit, d.c., washington, batting .666. first time since '09 the house passed a budget.
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granted, you could take a fleet of trucks and fit them in between the budgets. but they fully expect based on the announcements the budget will be forthcoming at some point. the is this, you know it's all about debt and deficits. from my perspective, it's important. it's a weight on the economy. we want a nimble, light, adjustable, highly efficient economy. and for the most part we have one although we seem to be doing our best in terms of making it the little engine that could. but consider 2012. we added over a trillion to the national debt. i think the final numbers were close to 1.25 trillion. so that means for 2013 servicing the debt is going to cost an extra, i don't know, 35 to $45 billion. now we have seen washington, specifically the president in some of his speeches, like the state of the union speech.
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talking about we need 54 billion transportation programs. we need to find $35 billion for school modernization. 35 billion for teachers. but nowhere do we hear him point out, we also need to find 35 to 40 billion to service the debt we added on last year, and considering i'll make some assumptions about an ultimate normalization of interest rates, that's for 2013 what we added on 2012, for 2014, '15, '16, it's going to be going up. it can go up 10 billion, 20 billion, or 30 billion a year, because rates are historically low, even though heir not they' the very bottom. servicing the debt is an issue we need to find appropriations for. in the same way we have all the gee, i wish i could do type products, no matter how important they have. prioritization. cyprus, listen, i know everybody has had a spin around the block on cyprus. let's put a final chapter on it
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as we fwet ready to close out a holiday week. how many times have we said it? countries that have the common currency. the population of cyprus is roughly the population of dallas, texas. now can you man if dallas had completely different capital rules for the dollar in terms of how much you could take out, your rules about deposits, transfers. you can do this if you're a business. you can't wire it. i don't think that would play very well. so in the discussions, one issue always comes out. is the euro going to fine this is less common or countries have to leave? in theory it has already occurred. hope everybody out there has a happy and healthy and safe holiday weekend. and carl, it's all yours. >> we'll talk to you in a little bit. rick santelli in chicago. and a slew of names on the list here ch josh is watching
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all of it. >> the s&p crosses above its record closing high. still waiting to see where we close today. what have been the big winners this year? a quick rundown for you. netflix taking the gold by a long shot, up some 106% this year. best buy and hewlett-packard rocketing up hire. not everybody joining in the party. cliffs natural resources in the red as is jcpenney and peabody energy which is down this year. wal-mart is hoping to deliver packages to online buyers. still in the early stages, but wal-mart hopes to tap into crowd sourcing to deliver their goods in a faster way. it brings us to this morning's squawk on the tweet. what could possibly go wrong? keep it clean and tweet us.
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cohen known for quickly getting in and out of big multimillion trades. is he doing the same thing with a multimillion dollar real estate? >> you know, steve cohen is a big trader and has been a busy trading month for hip, especially with his private real estate. he recently purchased a house in the hamptons for close to $60 million. this is a house on the water. this house was only on the market for one day, i'm told. it was immediately taken off the market. he didn't go look at the house before purchasing it. other people already there include jim chenos. jerry seinfeld. ryan barren who we often see here on cnbc. we're also told that steve cohen put his apartment, or one of them in new york city on the market. that's up for sale for more than $100 million. that follows his purchase of the
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picasso painting. maybe it's all retail therapy in response to the big fines that he paid or perhaps it's just steve cohen showing confidence to the rest of the world. back to you guys. >> >> it's hard to know if he's top or bottom. he's selling one and buying another. >> is there any strategy for here to shield assets. >> i think it's more opportunistic on the one hand. this is next to the one he currently owns in the hamptons. he swooped it up. he probably had a house in new york city. i was speaking to someone this morning. they said steve wants to project an image of confidence. he wants to tell the world that everything will be fine. especially to his traders and
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employees and counter parties. >> i'm light sli concerned. you have to rearrange your holiday plans. is that the one you read? >> the $16 million house? where will he go now? >> i don't know. >> the times that we have had at this house. >> steve cohen. >> i'm sorry. >> steve is hardly ever there. i tent to like to do that. >> they're not there. what a waste. >> given all the cnbc people who away in the area, i think we should buy cohen's current house and have a cnbc bureau there for the summer. >> of course which you would be the borrow chief, of course. >> of course. thanks a lot, robert. great reporting as always. what is coming up tonight? >> we have if q2 playbook. technical strategist. he called health care nine months ago. he will give us a direction of
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the markets. you continue to bet on the best performing stock this year. brian marshall of isi. and two great matchups tonight. ibm versus google and ebay versus disney. >> we'll see you tonight. >> yes. >> have a great and long weekend. if you're just joining us, here is what you missed early this morning. welcome to hour three of "squawk on the street." here is what is happening so far. >> you look at the doors and what is happening. they're letting in one person at a time. >> when you see this company make this money without the new product yet, i go back to some of the parts, morgan stanley saying maybe you don't have to think about the device. >> yaw know what is surprising, too, playbook sales. 370,000 playbooks sold in the quarter. i feel like it's like sasquatch.
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have you ever seen it? >> now i did get up at 3:45 to see the bank lines. it wasn't like a justin bieber concert. >> the offer that we have is a great organic growth story. because of our line of sight margin improvement, we bill a business that could go over great shareholder returns even in a low growth environment that we have right now. >> look, we're going to correct it at one point. the economy is getting better. the fed is in our court. the earnings are going to be okay. we're live on a thursday. final day of the trading week, the trading month, the trading quarter. and with that, the southbound southbound after five years has
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crossed above the freeze record closing high. it's currently at 1,567.43. also the dow is up 51. the nasdaq is up almost six. the maker of uggs as they raise the target from 65 all the way up to 100. and after the parent of calvin klein and tommy hilfiger gives a d dispointing outlook. they would die lute the shares instead of helping the product. blackberry is throwing investors for a loop, posting a surprise profit but losing subscribers. we'll try to make sense of the stock's volatile swings. plus, the market rally rolls on. the s&p 500 above the all time closing high. we'll talk to the chairman of rogers holdings about how he's
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playing the rally. and the man who turned down $500 million. but first, we'll kick it off with the markets. april has been the best performing month of the year since 1950. are we ready for another leg up in the markets? jim rogers joins us this morning on the news line. jim, good morning. >> i'm delighted to be here, carl. how are you? >> i'm pretty good. a lot of bears argue good reasons not to participate in q2. what do you think? >> if you give me a trillion dollars, i'll show you a good time, too. i'm somewhat skeptical because i know it's going to end badly. >> let's scepter on the u.s. the people point to typical seasonality.
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big components like ge. zi version from the broader index. cyprus, even though near term uncertainty may be lifted. would you preference be to stay state side or not? >> no, i'm certainly not investing in the u.s. they are making all time highs based on money printing. russia is at an all time high. the whole world is benefitg from the money being printed. >> what is your appetite on europe at these levels. >> i own a few shares for 15 or 20 years, but no, no. i'm certainly not buying there.
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it's scary what's going on in europe. i am making sure i don't have too much money in any bank account in the world. now there's a presence. the imf has said, loot the bank account. you can be sure that other companies are going to say say, it's condoned by the imf. let's do it, too. >> have you made moves where you were a large depositor and you said get me under the insurance cap? >> well, i'm not like you but, yes, i have started the process already. and everybody you know should do the same thing, too, because they're going to go crazy the
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next time around. >> now there's a discussion that we had about whether or not this is truly a template, taz dutch say. is cyprus a special case? might we expect a similar strategy to take effect in a larger country if need be? >> of course it's going to happen now. the imf has condoned it. it's politicians who tell you it's a special case. what more do you need to know know? please. you better hurry. you better run for the hills. i want to make sure that i don't get trapped. now they find out that they're making a contribution. that's what it's called, carl. a contribution to the stability of cyprus. it's all of these politicians.
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>> rule number one is make money. >> rule number three is don't trust any government. if you're going to listen to government, you're going to go bankrupt very quickly. >> i know one of your other areas of focus is agg. can you be more specific? >> well, agriculture has been a disaster. we've produced less and consumered more for ten years now. we have very low inventories. it's been a disaster for 30 years. the prices have to go much higher. maybe not this year but this decade. do you know anybody who became a farmer? probably not. >> they're making a lot fewer of them, that's for sure. jim, have a great time in chile,
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i believe is where you are. we'll talk to you soon. >> thank you, bye-bye. >> the banks in cyprus are opening for the first time under very tight controls to prevent a bank run. michel michelle caruso-cabrera is live. >> reporter: the banks here will be open for one more hour. it was quite a crowd when the banks first opened. a lot of people who had no atm card and were desperate for cash. after that it calmed down considerably. it's hard to know what the true demand for money would be because they were closed in order to thwart bank funds. you can't take anymore more than
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1,000 euros abroad, for example, if you're going to be traveling. no checks can be cashes. they can only be deposited. if you want to transfor more than 5,000 your owes it's going to be reviewed by the committee. we don't see long lines all day here at the banks. additionally that led to unskern ty. >> i just came here to see the rules and regulations. they said no. whatever i asked, they didn't know. >> reporter: so he raised a question if he could move his money to a subsidiary abroad. there's a lot of on if the
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russians can transfer accounts or travel to london and take their money out of banks, subsidiaries or branchs in the uk. if a bank manager allowed that it would be illegal. then that account would be a uk account. and you wouldn't have been able to access it here. maybe that clears thing up. >> yeah, a picture of how complicated this is going to be in the weeks ahead. blackberry reporting a surprise profit for the quarter. is it time to get bullish on the name? first, though, rick santelli with some discussion of gdp coming up. >> absolutely. listen, i like wikipedia. i looked up scientific method definition. here's what they had. a method based on measurable
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let's take a look. we're trading higher as s&p surpasses the closing high. what a year it has had. josh lip on the with a look at a couple of individual stocks. hey, josh. >> hey, carl. check out one oak which is moving higher this morning. mark says this stock has near term upside. hits 48 over the near term sessions. mark also says this is one of the leaders. this is giving the stock a tail wind. up 2.2% right now. carl, back to you. >> thanks for that. blackberry is reporting mixed results this morning. the surprise profit was interesting. the revenues were light. i want to get insight with chris thompson. has an underperformed rating and
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10 price target. good to have you on the show. good morning. >> hey, carl. thanks for having me back. >> you nailed it on the model for shipments. you were more optimistic about the ten than came to pass. >> well, i'm disappointed. we have a brand new product that we've been waiting for for more than a year. a lot of pent up demand. i do expect it to increase substantially in the next quarter. the stock did trade up in the early going. we'll see where it is right now. it's been back and forth. people are asking why should a name that fell short on revenue and lost 3 million subscribers trade in the green at all? >> it's a good question. the i think the quarter was mixed. it offered positive news for the holders and short sellers as well. i think the key takeaway is if you look for the guidance and exporter they're going to
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approach, break even, and the stock right now is trading on next quarter fundamentals. we've had a look at our model. we're finding it hard to see them not make a profit next quarter. >> does that affect your target of 10 or not? >> no, it doesn't. we have gone from a trading thesis to a fundamental thesis. it's hard to suggest them take a long term hold in the stock. there are going to be service pressure there. and we don't often think it's going to be that successful. >> when you talk about continuing subscriber base, how bad can it get? does having $3 billion in cash offset that? they have some firing power and some of the critics acknowledge
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it's going to be tougher to kill them off. >> yeah, you have to look at the math. they shipped about 5 million. so if you look at the map, that means they lost 8 million. that makes sense if they have 60 million consumer subs. expect them on an ovrj of a two-year term contract. as the old platform becomes more steal. >> so with your target of ten and you mentioned some of the fair evaluations, will it surprise you whether through a squeeze or any short term momentum the name gets higher than you expect zm. >> yeah, i think it's going to be range bound over the next quarter. i don't see much of a squeeze. i think the investors are there for the long term thesis.
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to achieve a sustainable profitability, they will really increase the blackberry shipments well above 35, 40 million units. we don't have any confidence that they can achieve that yet. just through manager talk there is the likelihood, isn't there of an outlieer news event where they are bought or they sell a large part of the company? zl yeah. >> i would be a little bit surprised if they're sold. the network operating system is pretty important. i don't think you will see the u.s. president carrying around a blackberry so there is news there for entry level smart phones in china, for instance. but for now it's really hard to make a speculation or to buy the stocks based on that
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speculation. >> one of the best that we have talked about in a while. thanks so much for your time. >> any time, carl. >> when we come back, zillow is trading near new highs. zillow ceo will join us live for a "squawk on the street" exclusive. we'll talk about what's ahead for the company at large. the index is trading above the all time closing high. carfirmation.
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rebound in housing helping
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boost shares of zillow. what a year it's had so far. up nearly 100% over the last three months. two initiating coverage would outperform the ratings. here is a very happy man. the ceo of zillow. good to have you back. >> thank you. >> the street is beginning to figure the story out. what is taking the time? >> it's a bit of a complex story. we're in several businesses. we also provide software tools to real estate professionals. we're a b to c company and that's a little complex. there was a long period of time where investors lost money in the category. >> in the real estate information services category. that's because before zillow the leader didn't have a consumer orientation. and zillow approached it and that's made all the difference. that's how we have made a great business. >> we were talking about the
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number of apps. 24 now for platforms that i can't keep straight. how much work is that? >> it's very complex. we have a huge advantage as a national holiday. we can deploy national resources to mobile. to write apps across all the platforms. we had 20 homes viewed every second. today it's 75 homes viewed every second. so huge mobile growth. four times as big as the number three. so mobile, mobile, mobile for us. why so many companies are struggling to monotize on mobile, we monetize on mobile. someone looking at a listing on zillow mobile is three times more lickly to contact an advertising agent we love mobile. >> people can probably put themselveses in that frame of mind.
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you see something on the phone, you make the call. >> you are driving around. you have all the information at the bottom of your hand. >> can that continue if people don't list more and more homes the way we seem them doing? >> the real estate market overall is back. but inventory is very tight. a quarter of all homeowners have negative equity. they can't list their house unless they want to go through a short sale. that makes inventory tight. if there are listings, they sell quickly. that's created in the market. so home values are growing 10% year over year. nationwide, it's a little bit more moderate. 3% year over year. 15 months in a row now we've had home value appreciation. so this is a great tail wind to our business. >> do you have any fear that the
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degree this has all been led by distress that prices will come back, retrace? >> no. there are a lot of much eltier fundamentals in the recovery than in past recoveries. there's some investor demand. some is fueled by low mortgage rates. there's a lot of pent up demand where people didn't buy or sell their homes. there's a lot of buyer interest that should have traded over the prior two years that didn't. now there's a late demand that has come onto the market. >> you must be waiting for builders to really start construction in a new way. >> yes. >> and we have to get this annual rate up. >> that's the reason the for existing homes is overheated. so we're starting to see that change. at the start we were around 300,000 new home sales. at the peak it was about a million. now we're in the 500,000 range. so we're getting there. it takes a while for new homes
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to be built. >> should we expect the metrics in the rental business to go down? >> rentals are a big business. we've acquired three companies in the rental space. so it's a big focus of ours. and partly from a demographic standpoint and partly because inventory turns over more quickly in a rental space. six times faster than for sale space. so it's even more important than shopping for sale. >> get in and get that lease. it happens a lot quicker, as you say. >> definitely. >> it's fascinating to watch. we'll see how the rest of the year goes. >> thank you. >> when we come back, is the weather in march an omen for what's ahead for retailers? find out if you should be betting on the consumer in the next quarter. and later on it's been quite the year for social media. a lot nor "squawk on the street" in just a moment. [ male announcer ] i've seen incredible things.
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metro pcs up more than 3%. the advisory firm urging shareholders to vote against a merger. new mile tones for a pair of food companies. rising to all time highs. and a wall street debut for pinnacle foods.
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the homes of duncan hines trading 13% above the ipo price of $20 a share. pretty interesting. >> what a lovely morning speaking to the ceo. he reminded me about the fact. now stay in the business long enough and it's amazing the people that keep coming around. $22.53 here. we're overit. we're at a new high. what got us here to the new high? consumers staples health care defensive name. discretionary and the industrials as well. i want to show you here a number of them are close but not at new highs. some are closer. look. utilities, energy, these were at new highs pack in 2007 or so,
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and just below the highs right now. there's a group that never got to do highs for various reasons. those are tell come financials and tech stocks. if you know what happened here, take a look at the tech group here. we're going back to 2000.com bust. the s&p tech group -- put up the s&p tech stocks here, they were below -- we're 50% below where it was. we were at 900 back then. we're at 480. just 12 years. and we have more than twice as much to gochlt we're still half way where we were back in 2000. put up financial stocks as the s&p financial sectors. this is a slightly different situations. here they all hit their highs in 2008 and plummeted dramatically to 2009. and we are essentially half way. we were close to 500 on the s&p financials in 2008. we're only half way there. and these are the two biggest
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sectors. this would have been a major factor. we vould are hit new highs a long time ago. what will happen next week? we're talking about european central bank and the bank of japan. look at this ugly week for europe, greece, spain, france, all to the downside. a lot of people are asking what will the ecb say to calm everybody down? there's not going to be runs on banks. the meeting is coming up. they may cut rates. it's not entirely clear. they have cover there. maybe nonstandards again. there is clearly a lot of concern that small banks could come to the ecb in big trouble and say we're getting runs. we need help. i think you'll hear draghi talking about a banking union. there will be a need to resolve the banks in a clear and
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consistent manner. that's why there was confusing on cyprus. >> and strange the way he was oddly quiet. >> he has to be oddly quiet. he would be able to resolve all the problems with rules that everybody can understand. there are not any right now. >> and that's driven us crazy for the past few days. let's get a check on energy here. sharon epperson is live for us today. >> the momentum that we have seen in the oil market seems to have slowed down a be bit. oil prices, at least the us oil price is approaching $97 a barrel. we're looking at the highest prices that we have seen in five weeks time. the evaporation of the big spread that we had seen. we are also taking our eye on natural gas and some of the other oil and refined fuel contracts and how natural gas
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has truly outperformed in this quarter. that compares to a 10% rise in our gasoline futures and a 4.5% rise in the wti contract. heating oil prices are down 4% so far this year. that may be because the heating oil contract, is no longer going to be in existence. start twg the may contract, the cme group is launching a new contract to focus on diesel. and this is a way that a hope will boost trading volumes. it's also an indication of how important the diesel market is around the globe and helps to factor in the state specifications that will go into effect for diesel contract coming up. >> interesting at the new york auto show the diesels are the talk of the town in some ways. very interesting. thanks a lot, sharon.
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>> sure. breaking news in the bond market right now. hey, rick. what is the action like? >> well, i tell you what, i was disappointed. it is the last action. 99 billion supply in the new home. but the seven year notes, well, let's go to the numbers. the ultimate yield was 1.248. so two basis points or tenths shy of one and a quarter-year-old. this was 124.5. and it was pricing around 124. so this auction tailed a bit. that's not a good thing. ten auction averages 2.68. 2.68 dlshz of investor money chasing every dollar worth of security available. this one came in a little light. it doesn't sound like a lot. but i was shocked. the last time was in october of last year. but you have to go all the way back to may of '09 to find one lower. for an a-plus writer, let's go
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to bill fresa. welcome, bill. >> good to be here. can you hear me? >> yes, i got you. the pieces you sent me to talk about today excited me. i tell you what, you know, scientific method is preltty much hard and fast. we mentioned this before, the two snowflakes. when it comes to macro economics or climate change, trying to save the scientific method is alive and well is a real stretch. tell us your thoughts and the pieces you have written to try to equate real guide science to the numbers. specifically the gdp that we get every month. >> sure. don't confuse scientific method. they are human and make the same mistakes the rest of us make. we look at the gdp figure. hoorah. everybody is excited.
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people are getting more pessimistic at a slower rate than we predicted. you can't define gdp. tell me how in a $15 trillion economy you could measure it to 1% accuracy. this is complete fiction. we now have 106 agencies reporting on macro economic statistics, and the biggest ones acall the gross distorted product. and all of this is moderated by the bu roar of statistics they can tell you if it's bigger or smaller. we look at -- look at the procedure. >> let me stop you there a minute. traders -- i've been involved in trading in one form or another since 1979. and the statistics on the floor
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are looked at the same way. many say that's what we have. let's stick with it. apples to ap tls to apples. pick one variable that you think is large enough to quantify as not really being something accurately measured. >> all of the above if you don't adjust it for the price of the dollar. we're in the middle thof norm asset bubble right now. it's not showing up too much in the grocery store. but it's certainly showing up in the prices of stocks and homes. they're now buying $40 billion month. this is an illusion. we watched cyprus collapse before our eyes. we imagine it's not going to happen here. everybody thinks they're smart enough to get out before the thing comes to an end. even the people who know better are happy to make money why the
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sunshines. they have to hide somewhere and they better make it now. >> i think the next time you're on i want to talk about the accuracy of statistics in china and really get you wound up. carl, back to you. let's go to josh lip on the for a quick market flash. hey, the news that the engineering company updated the the forecast to grow this year. ceo is saying he's expecting a revenue of 10.7 to $11.2 billion. new awards of $16 billion. the stock is up 5.5% right now. carl, back to you. consumer staples is one of the best performing company this is quarter. we'll find out which individuals names may make you the most cash. and built in a basement with
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money. we're going to get some of his top picks. he's bet the s&p 500 every year for the last five. donald yackman tells us where he's finding bargains. big show in about 15 minutes. >> all right, thanks a lot, scott. consumer staples is one of the best performing sectors of the corner. now pinnacle is going public today. here's what he had to say about the sector doing so well. >> we're looking for stocks that are stable. they -- or businesses that are stable that can perform well in even challenged economic times. and one that guarantees a dividend to give these a reason to play. >> so does the sector have more room to run here? hey, tim. >> hey, carl. >> has the performance so far this year surprised even you?
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>> it's been stellar. it's been amazing. probably the average stock is up 20% or so, and they're all up, and 16 of the 17 outperformed the market. >> how much of this makes sense relative to the fundamentals? is this about investors wanting to play but from a defensive crouch? >> i think the market is focused on cash flow and yields. my names have been stellar from that perspective. picking dividends up in 20 or 0% types. and we just had a 38% increase the other day. that's just one of the large orders that we have seen. >> so when do you make the turn? >> well, there are some na names that are starting to push the
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edge of the envelope. right now i don't want to fight too much because the growth is there on the high evaluation names. names like spirit and wine companies. these companies are enjoying tremendous growth right now. >> yeah, and yourdown verse includes the kraft and kellog's, names we talk about a lot more than we used to. a turn so how. something symbolic we may look back on. >> i'm not sure what pinnacle means. i mean, i am not likely to cover it but it seems like i have. i have covered every brand they own except for tim cascade ships
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in one form or another. so these brands have been arn the block and a number of owners. you're right. >> very interesting time right now. we'll see where we go. tim, thanks again. >> thank you. >> tim is joining us, talking some consumer stap lgs. can you imagine looking at a $500 million offer for your company and saying no thanks. the ceo of qualtrics did that. we'll find out why after the break. quickly the s&p is closing above the all time high. and with little room to spare here at 1568 t
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. history in the making
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as our world becomes more connected, we see twitter flubs become public, so how can companies stay ahead of the curve? we have a company that provides a platform to give real-time analysts real-time results. ryan smith is the ceo of qualtrics showing us a pretty fascinating story. how are you? >> good. thank you for having me on. >> i'm reading fascinating accounts in the way you started the business and how you have grown in the last five years. can you give people a sense of how much your life has changed? >> yeah, we have been in this for a while. we started in a basement almost
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ten years ago and boot-strapped the organization from the ground-up with no outside funding. so we have been going pedal to the metal for some time now. >> your sbeintent was to fix th outsource research market. there's a story behind that, can you tell people? >> yeah, historically when companies need to gather outsights this is a $30 billion industry, and that's not counting the new up and coming employees within the organization that need to collect data. and our goal is basically to explain to individuals and to show them through our technology platform it is not that hard to zba zba gather insights. it is 2013. and we are watching our customers become more data driven and it is personal. it is something that we believe in and we believe passionately about. >> you got some series a from sequoia and excel, names people
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know well, and now there's the offer for $500 million that you turned down. walk me through that story, what happened? >> yeah. i think you build a company with a long-term vision and a company to keep, you're going to have individuals that want to be a part of that. and, you know, we've had multiple offers and i think we'll continue to have those. a $500 million offer was put in front of us, and i believe they will continue to come. but we have chosen to do this ourselves. we have gone with sequoia and excel, two great firms. we said if one and one equal five, then we have chosen the best. we are not disappointed with our decision. the bottom line is billion-dollar opportunities are rare and we are sitting on one. >> i don't need to remind you of the lessons some have taken from groupon and the offer they rejected from google and probably are sorry about now, does any of that weigh on you?
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when entrepreneurs watching this segment right now say you're a fool, does this give you second thoughts? >> not at all. i started in a basement and was there for five years without taking investment. you know, we are focused on the enterprise. we have 5,000 customers globally. we started in academia with 1300 universities and i feel like we are just getting started. our licensed operations are doing twice as much data collections than they did last year, so the volume's increased so we are definitely seeing that it's working and the organizations that have become data-driven are winning. and ultimately we are helping them be right. >> yeah. that's what's called vision and certainly focus. you have to keep it no matter how many distractions are thrown your way. please come back, ryan, it's great talking to you. >> yeah, thanks for having me on. >> ryan smith, the ceo of qualtrics.
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and without a line. now that's a fast car. it's just another way you'll be traveling at the speed of hertz. otherworldly things. but there are some things i've never seen before. this ge jet engine can understand 5,000 data samples per second. which is good for business. because planes use less fuel, spend less time on the ground and more time in the air. suddenly, faraway places don't seem so...far away. ♪ well, the s&p passed above
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but now fluctuating around the all-time closing level adjusted for neither dividends or inflation, just a nominal level. our director of floor operations for ubs is joining us. we got the break, art, what does it mean? >> if you close above it, then it makes a record. not the intraday high we are exceeding, the record closing high. so we need to close. we have a couple things, a sigh of relief. banks reopen partially, there were more supporters and depositors, that's a good sign. when you're going into a three-day weekend, friday before, in this case, the thursday before a three-day weekend, as is 70% buyers to the upside, that's all there. we are doing it again in light volume. i guess the negative concern is this is the end of the quarter tonight. usually we would be talking
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about the end of the quarter window dressing. we have a spectacular quarter with some feel around in the street that some people might want to nail down those profits, so we'll see if there are sellers on the close rather than buyers. >> yeah, there's that calendar issue some talk about. others say we are getting close to a seasonally perilous time, yes, fair to say? >> yes. selling may go away which has close to coming to april to selling and going away. >> and to others points, to ge, diverting from the dow, separating from the dow, not confirming what the dow has done recently, why would you want to play the game in q2? >> well, i think people are hoping that they get around -- they will watch carefully next week, we came back to the brink again in europe. and we walked away. i think, as you and i have discussed time and time again, the problem for many people is if you're gauging the market by the macro data, things like gdp
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and whatever, this market is ahead of itself. that's why you have not been in it and wait a minute, the economy is not moving. if you are gauging it by earnings alone, companies have learned how to grow lean and mean and do more and more with less and less. so the earnings are up there. so those two separate gauges or those two separate points of view are what separate people. so that the cautionary side that you eluded to, mostly are the macroplayers. >> the other discussion for most of the quarter is the way the u.s. has stood out from the rest of the world. if you are a global investor, are you really going to try to play europe and roll the dice on what's going on there long-term? or are you going to look at the macro, some of it good, some not so good, but are you going to try to stick and play the snus. >> yeah, i think what you're playing is that every hedge fund in his or her sib bling has gone to japan after all the commentary and everybody's moved o

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