tv Fast Money Halftime Report CNBC March 28, 2013 12:00pm-1:00pm EDT
long nikkei, and it's been a spectacular trade, but those were the quick and the not-so-quick are staying here in the u.s. europe is not really an alternative, so if i missed out on japan, i guess i stay here and that's what i'm doing. >> have a great long weekend. have a good easter. >> you too. i will hide my own eggs. that does it for us. let's go to "halftime." carl, thanks so much. welcome to "the halftime show." four hours until the close of week and here's where we stand at this hour. the dow jones industrial is good for 46 points, but the story today is the s&p 500 above the all-time high. here's what we are following on "the half." the iconic investor here for the hour with his picks to make you money this hour. the yacktman file, now he
has names to add to your portfolio. jim agod frede is also going to join us. plus, the s&p 500 is pushing past the closing high. where does the market go from here and what's the best second quarter setup? we are tracking this with steve liesman, josh brown, josh, what's the best set up for the quart her? >> let's look at where we are relative to the s&p 500 has been health care by a long shot, secondarily, utilities is in the top five and consumer staples, that's not necessarily what you want to see at all-time highs. so i think it will be critical, that technology gets off the map and we see some kind of input here for materials to the upside. we need that rotation to happen for bulls to feel truly comfortable that something truly bigger is at play than just kissing that historic high. >> wise, the non-traditional rallies are the ones we're
working right now. what's going to happen as we enter the second quart her? >> in the second quarter we'll have more uncertainty because of europe. so we'll have to take a look at europe to see if their are bottomed out or if they are going to continue to decline. we've gotten good news out of germany and that's the most important news we can get. we got some troubling news out of china in terms of tighter property controls, doing away with the balance sheet finance, and they have been trying to do away with that for a while. overall, we'll still trend higher. there's always the risk of a few percent down but that shouldn't keep you from the market. to josh's point, utility etf hit an all-time high today, and that's not typical of a bull market. >> b.k. >> yeah, certainly i tend to be more bearish here on the desk. going into the second quarter, in the u.s. we need to be concerned about earnings. act censure came out today, the largest consulting firm out there, they had bad earnings, their revenues were lower, they can't blame that on oracle's sales people. when i put that together with
tbix, oracle, i see the slowing in the earnings picture. going into the second quarter, i would be concerned the market is a little ahead of itself. >> were you ready for the rally, b.k., surprised by it? >> listen, i have been surprised by this rally -- you mean just recently? i have been surprised by the rally for the last few months. >> for the last few months, it has continued to climb the wall of worry. all the things you and others mentioned, the market doesn't seem to care. >> the most frustrating thing for the market and people like me is it is not necessarily responding to the economic data. we saw gdp weak this morning. >> well, you can make the argument, though, that it is not just the economic data. it is not just the fed greasing the wheels here. the economy here and the fundamentals have improved a little bit, right? >> if you look at this morning, the gdp, the chicago pmi -- the chicago pmi is a leading indicator. >> in the last couple months, they have been very good, you
can't point to the pmi has a negative, no way. >> we still have progress in housing and jobs, that's what everyone is focused on. chicago pmi is interesting conversation fodder, quite frankly the correlations -- >> and the companies you mentioned are not typical gdp companies, accenture is a very highly competitive space. >> but they are up for the day, guys, come on. oracle is at the bottom. your point is that maybe these bad earnings will lead to a lower market. these bad earnings are actually -- you're seeing a rally on this end. >> that's my point, that's frustrating. that's what i'm trying to say. >> my bad, okay. all this bad news is coming out and that's extremely frustrating. >> get aboard the choo-choo! >> i think it is irresponsible to get bowled up on five-year highs after this big run. at the very least, if you don't want to be short, be careful at these levels. >> our next guest has more than
40 years experience on wall street. his research is used by some of the biggest players in the game. he's lazlo barrini, he's our guest host for the hour. nice to see you again. you were here last for a pretty interesting moment for cnbc. we want to remember back for a moment. >> i am going to defend myself. >> i never said i want to be friends with you, bill. >> okay, carl. okay, carl. >> you said you would like to be friends to invest together. >> carl, i have no interest -- you think i want to invest with you? let's move on. let's move on. >> you had a front-row seat that day, lazlo, we'll try to provide the same level of entertainment this time, but great to have you. >> thank you. >> you have listened to the conversation here, quarter's coming to an end, s&p above the all-time closing high, give us your broad thought on the markets as we sit here today. >> very interesting situation. in second quarter of 2009 the
market was up 15%. the s&p had a mass decline in that quarter at plus 1500. this quarter the market is up 9%. the s&p advance decline is plus 4,000. you are seeing one of the broadest, strongest markets. and i think the story is not sectors, the story is not themes, the story is not ideas, the story is stocks. it's not health care. all right? it's johnson&johnson, it's not financials. it's black rock, berkshire resources. no one talks about telecom stocks. verizon is up 14%. no one mentions the airlines, it's stocks. you have a very broad market which makes it very difficult for managers because everything is going up. now you've got to pick the best of the best and it's a lot tougher. >> so this focus on, well, health care is leading so it cheapens the rally so to speak, it doesn't give the gusto people
are looking for, a typical risk-on moves, you don't care. >> i don't care. because this is a stock market. and everyone is looking for a top-down play, whether it be dividend paying or large grows or whatever, this is a bottom's up, pick the stocks, pick the winners. >> so what about earnings and the strong dollar, does that bother you in terms of earnings? >> it doesn't bother me because it does not bother the market. >> not right now, anyway. >> i look at the market, and i always like to bring up last may when we were all worried that greece -- there was a big election and controversy, the greek index was up eight days in a row and gained 25%. that told me all i need to know of how greece was right there. a great stock today is boeing. everybody who was worried about boeing with the airplane and the defense contractor, i sold some thinking i was going to buy it back cheaper. the stock didn't move. the market was -- >> because their heel is at 787. the reason it didn't move is
because it's a timing issue. whether you buy it today or tomorrow, you still have to buy it from them. >> but the news was all negative. and if you were concerned about this, the market is not selling the stock. as long as the market is holding up, i want to be there. >> laszlo, i want to take issue with what you said. i think it is about stocks. if you own material stocks, steel stocks, the cold stocks -- >> you're missing the move. >> not only do you miss the move, you've lost money. if you own telephone instead of verizon, you didn't do nearly as well. it is about stock picking and sectors. >> i think to his broad point, not to put words in your mouth, but you already put them in your own mouth here. you have to pick stocks is what he's saying. >> no, but i thought you said the worst rally we have seen, don't worry about sectors, don't worry about top-down, not all all. >> no, i want to buy stocks. the one sector, the one area i would avoid sector is the materials, gold, copper and the
like. i want to be a stock pickings market. >> okay, fair enough. >> let's talk about technology for a moment. large cap tech largely has not participated. you have big holdings in tech, whether it's apple, google, ibm, amazon. does it catch up? do they start playing along in the second quarter? now, obviously, google has done well and some of the other stocks have done well. apple hasn't done all that well. >> no, apple has been a sore point. fortunately, the extremely low cost base and the clients do not want us to bail. because we have done very well. ibm has been a leader. ibm's being in the market so far this year, so there we want to pick stocks. and a lot of these holdings are long-term investments. >> can i ask you about ibm? do you think you're going to see a recovery in revenue? because the story of ibm is the double-digit earning story because they are cost cutting and buying back stock, are we going to get revenues to go up a
little bit so therefore you get to the 11 to 13 multiple range? >> yes. i think the stock has had some rotational move, but i think ibm is a stock we want to own and hold. >> let me ask you about apple, bill nigrel was here yesterday saying he was buying on the pull-back, have you been to a buyer of apple as it has come down? >>. no we sold down to the pain threshhold where we could, and right now there's too much noise, too many issues going on. stock was downgraded today. they put out a number from some of these sources of revenues that are coming with it and so many people. they are hurting these people, their pad sales are down 8% according to so-and-so. who is so-and-so? >> i saw that. and what the news says was that in expectation of the ipad mini launching third quarter that the current mini shipments are down. i agree there's a lot of noise there. >> you can go down the portfolio
here. mcdonald's, has the story turned back to the better or no? >> mcdonald's is good, most of my clients are long-term investors. this is a stock costing around $60 with a nice dividend payment. i don't think there's a whole lot of downside. >> i guess i would be happy if i got in at $60. it is sitting at $100. we are at the end of the quarter as we mentioned, we want to look at the best performers and the worst ones as well. maybe the best ones are going to continue, maybe the worst ones are going to reverse. take a look at the top performers from the quarter and this is from the s&p 500. we'll get laszlo's thoughts on this. the netflix, best buy and hp gains have been pretty unbelievable if you consider the fact that at at least two of these are so-called left-for-dead stocks, best buy, hewlett-packard, are you surprised by the moves we have seen there? obviously, netflix has had just a tremendous run. >> well, netflix had a very good earnings, but in this market i'm not surprised by individual names. i mean, you have some losers like you have there, but then
you still have jcpenney which won't go anywhere. it is not a theme, it is not a bottom fish where you pick the winner. again, you have to go down and get the individual names. >> guys, what do you think? >> for every left-for-dead stock like a hewlett-packard, there are ten that didn't give you that benefit and you lost money on trying to bottom fish. so i think laszlo and i are on the same page, his portfolio emphasizes quality. if you want to look at the better cap stocks, hewlett pack card not withstanding is a special case. you'll find global businesses, price in power, economic mode, big dividends, big cash flow, they all kind of have these same characteristics. and i think if you've done that, you've probably taken less risk than the overall market and done just as well if not better. >> all right. our hope certainly over the next 45 minutes or so is to give you many, many names to consider to research yourself and to think about as we enter the next quarter with laszlo sticking with us for the rest of the
hour. he'll be revealing his top ideas throughout the entire show. he's going to tell you his number one pick as well when we come back. and how about this for later on? don yacktman, the president and colorado-cio of yacktman asset management. $17 billion in management. he'll show us where to find bargains in this rally. big show, we'll be right back. 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
welcome back to "the halftime report." i'm josh lipton. blackberry in the green right now, though off the highs of the session. before the bell this morning reporting a surprising fourth quarter profit, getting a lift from the first sales of its new z10. still, the company saying it lost some 3 million subscribers in the period. blackberry up 2% right now. scott, back to you. >> josh, thanks so much. laszlo, you don't own this one, do you? would you ever? >> i used to. >> when did you sell? >> last year we owned it for a while. and it just didn't do anything, so -- >> interesting earnings report, guys. >> i'm surprised by the lack of volatility. this thing really didn't move. >> it was really volatile in the free market. >> right. so you know what it seems like? it seems like there's this discussion now about what the actual business model is going to be going forward. the bullish analysts are saying, no, no, no, you don't get it, forget the handsets.
so i think the company has some time here to actually work things out, more so than they did this time last year. >> mixed bag, as i said, revenues missed, surprising profit, subs fall. >> okay. so let's look at it. so, what they came out and said was that the prepaid subs fell. they sold a million phones and there are a bunch of uninformed opinions going around saying, that doesn't mean they sold a million, they stuffed the channel because of counterfeit sales. that's how every phone manufacturer counts, whether it's apple or samsung, you sell to the carrier and book the sales. >> are you making a bullish case right now? >> yeah, i sold this morning pre-market after it traded up and back down. cash, $2.9 billion. last quarter it was $2.9 billion. cash has stayed the same. >> how long is that going to last, right? here in the u.s., how long is that going to last? >> well, they made money. >> i know, but analysts are talking about the cash burn coming up. >> they are talking about the cash burn as they ramp up their marketing costs, which i
applaud. the real launch is with the physical keyboard in may. i think the performance was good, the business model is changing to their credit. it will be open architecture to milwaukee it easier for another company to acquire them. the momentum will continue into the keyboard launch. >> i know you'll be interviewing as we talk to thorsten heins. this is an interview you will want to see and a first on cnbc. so don't miss it. we are back with legendary trader laszlo birinyi revealing his stock picks today. priceline, tell us why. >> these earnings almost every time, stock acts very well, the way we look at the trading patterns and money foes, priceline has been a core win for some time and appropriate accounts unfortunately is very expensive in terms of price and you can't put it in smaller
accounts for individual portfolios in most cases. >> what about their europe exposure? it's 60% of their business. >> it hasn't hurt them. >> but we are starting to see europe decelerate, so do you think that's going to happen? >> no, because i believe in the market forecasts and always worry about the things i don't understand. and i always -- honestly, people talk about the markets not worrying about cyprus, that means the market is not worrying about cyprus. the market is not ignoring it, it is just a forecast. >> so are you now, given where we are in the market and given what these stocks have done, being an ultimate stock picker, stay with what's working kind of guy rather than look for rotating out of one and into another? >> absolutely. absolutely. again, as long as it still meets the criteria in the metrix we set up we'll play. >> anybody else have thoughts on priceline? >> i have a question, so if you believe in the forecast, are you talking about company forecast or talking about market forecast? >> the nice thing is picking
stocks is the market is less important. so all are positive in the market -- >> but the criteria are the company forecast? >> i look at how the stock trades. i'm more interested in the stock than necessarily the company. >> so where's the value that we could add as stock pickers in terms of doing our own analysis if we are just dependent upon empty forecasts. >> it won't be an empty forecasts. i'm looking a the flow of funds and how it reacts to bad news and seeing how quickly it takes us to recover. all these kinds of things we used to do in single trading, touchy-feely. >> would you own a stack where the tacticals look great -- >> i'm one of the most anti-technical people on the street. >> when you talk about supply and demand -- >> i'm talking about things like flow funds. that's the ultimate fundamental. >> okay. let me ask you quickly about airlines, you don't like them. did you miss the move? >> yes. >> what don't you like about
airlines at a time where almost everybody, including your old pal who just ran over here, jim cramer, likes the airlines now? he picked them for the first time ever on his somehow not that long ago. why don't you like them? what don't you miss? >> i fly once in a while. >> right, but that's why you should like them you could make the argument, right? it's not the greatest experience. testify take an lot of capacity out. it maybe made things worse for you but made their balance sheets and bottom lines look better. >> that's true, but i took a 12-hour flight from istanbul to new york and got one hot meal. ten minutes after i got on the plane, and nothing for ten hours. >> but next time you go to take that flight, what's your alternative? >> well, i think i will stop in paris first. >> okay. but you wouldn't buy the airlines here? >> i would not. i have missed it and have been wrong. i'm not going to try to correct myself by hoping to be right this time. >> all right. don yacktman has one of the best
returns in the last decade making it the top performing category in its category. don, good to have you back. welcome back to "the half." >> thanks. good to be on. >> i'm sure you have been listening to some of the conversation here, give us your view of the markets as you sit there right now. it's the end of the quarter, we are looking at earnings staring at us coming into next week. >> well, i'm a very, very long-term horizon guy. we just think very different. we are not traders, we are investors, we look at for and risk adjusters of return. if you want a big picture, you would just say that those things tend to be priced ultimately against a 30-year bond, the u.s. bond and the u.s. bond i think is overpriced having a range between, what, 275 and 325? but on a relative basis, some of
the very large, very profitable companies, i just think, look, on a relative basis, they are probably the cheapest thing there. i think six of our ten largest holdings have dividend yields between 26 and 33, somewhere in there, and i can't understand why anybody would put treasury over them? >> we are showing you a list of the top holdings, which inluds proctor and gamble, cisco, pepsico, sysco, we want to give people an idea with laszlo and you, what would your top picks, if the market pulls back a little bit, what would you go for here? >> two things. we are in an awkward period. we have a policy of not revealing our quarterly holdings until about 15 days after the end of the quarter. so the only thing you can rely on in looking at our stuff is
the end of the year. the good news is we have a very low turnover rate. and we rank them in order of our risk adjusted rates of return prenchs. so the largest holdings at the end of the year would represent at the end of the year our best feelings, and those things don't tend to change very rapidly. so, i mean, the top three at the end of the year were proctor, newscorps and pepsi. >> i know you like apollo, i know you like microsoft, for example, and so you would urge people, if there's a pullback in any of these names specifically or the market at large, to load up on these stocks? you like them and why? >> well, let me use a little bit of a discussion here. we have two holdings in our portfolio that have a loss. and those would be of any
consequence. hewlett-packard which has had a big run and apollo which has not had a big run. if you look at our portfolio, if you are a patient investor, you like to look at things near their lows, not near their highs. and apollo fits that category. i'm not telling people that they should rush out and buy it, but i think with a package of those things, at the end of the year we had small holdings in hewlett and small earnings in apple and rim, some of those just popped dramatic any the first quarter. the average stock fluctuates about 50% from its low to high on the annual basis. some of those stocks have fluctuated, like rim has fluctuated over 100% within the last six months. so stocks fluctuate. and we just have a totally different view which we analyze
companies. we think, as my associate jason says, you know, it's almost always about the price. so we like -- we are -- my son steve puts it, we are dumpster divers. we like to buy a lot of things that are out of favor, but just because the storm comes through and shakes the fruit tree and knocks some stuff on the ground, it may be easier to examine, but it doesn't mean you should eat everything that's on the ground. >> understood. we have to run, but i want to ask you about dell. what do you think should happen? what are you in favor of at this point? >> the best price. and i think i love competition. we are seeing competition now for dell. and it's a wonderful thing if you're a shareholder. >> i mean, you're not going to tell me whether you blik blackstone icon over the michael dell and silver lake deal? i know you have an opinion. >> tell me which one is going to give me the highest price. >> all right. we'll find out.
we'll have you back on. don, good to have you. up next on "the half," from tech to retail, plays on the stocks making the most noise on the street. gold wasn't too precious in the first quarter falling nearly 5%. we'll head to the futures fix to get the smart money's second quarter outlook when we come back. ♪ [ indistinct shouting ] [ male announcer ] time and sales data. split-second stats. [ indistinct shouting ] ♪ it's so close to the options floor... [ indistinct shouting, bell dinging ] ...you'll bust your brain box. ♪ all on thinkorswim from td ameritrade. ♪
the european markets are closing now. >> the dow might be up 12% during the quarter, but europe is shutting out almost exactly where it started. as the banks reopen in cyprus, paul donovan summed it up best, cyprus has not caused problems for the rest of europe. it just means next time we get a problem, the reaction will be bigger and the way to sort it out will cost more. in the meantime, it's interesting to note that during the course of the recent weeks the flight to quality has pushed yields down far further than we have seen here in the united states. look at this disparity as the yield on the ten-year goes to an almost eight-month low.
the other thing interesting, the cost of insuring the big 25 banks or insuring to invest in the bonds of the biggest 25 banks and insurers around europe is up for the tenth straight day. you can see it up there. there are strains deep at the eurozone, for the moment we sale into the weekend, fine, keep an eye on what's happening in italy. we'll get clarity over the weekend, presumably that they can't form a government and what that means for the italian electorate. back to you. >> simon, thank you so much. have a great weekend. simon hobbs for us. as the dark cloud is lifting over europe, or are there more surprises lurking in the shadows? we'll bring in jen, good to see you. >> thank you very much. >> cyprus appears to be behind us, hopefully, where do we go in the next quarter? are we still worried about europe? >> there are key risks out there. if we look at it from the economic stand point, we have the italian election
uncertainty, which obviously has a cloud over the markets until they're able to push forward with reforms. secondly, cyprus, although potentially we have moved on a stage, it has set a new precedent in terms of harsher bailout terms to shake other countries going forward. and because they were so specific in capital controls, that could create cracks in the contract. and then finally if we look at the smallest states, there is concern, for example, on the likes of slovenia, that they have to come back to recapitalize their banks. and their non-performing loans have exceeded 20%. so although small in size, these three different areas could shake markets over the next quarter. >> yeah, but i guess i'll repeat what laszlo said sitting next to me, it's not like cyprus is not important, the market just doesn't care. i mean, we have pushed past the s&p closing high today, maybe we'll close there, maybe we won't, but for the most part it
hasn't really mattered. >> i would actually say that there are underlying signs of nervousness that potentially that highlights how they are being overlooked. if we look at the debt markets in the rundown we heard before, for example, we are seeing risk aversion. cds spread, so the cost of insuring periphery bonds has risen. and we are seeing outflows in the equity markets. last week the european equity saw the largest outflow since august. and then we're seeing debt dynamics being under threat after we heard the nervousness. and the failure of italy to form a government, their debt auction disappointed. we saw soft demand and we did see high borrowing costs being demanded. now there is room to maneuver, but this is cause for concern. so moving away from the s&p and a lot of optimism in the u.s. and a lot of flows going in there, there is signs of nervousness. >> gemma, nice to talk to you, as always. thanks very much. >> thank you very much. >> see you next week.
let me ask you, laszlo, are people too complacent of what's happening in europe? are you? >> no, because i'm -- the first thing i look at every morning, again, i think when i look at the market reacting, i like the fact we come in and have amenities for europe. we trade down 60 to 70 basis points and come back. that shows the resilience of the market. the market is aware of it and reacts as it should. and this is okay, let's digest the news and move on. >> so right now you read and see cyprus on the front page and you're like, i have seen that before. what gets you to sit there and really pay attention over in europe? >> when the market goes down 1% at 935 and keeps going down. from what's happened almost every single time, it takes the initial hit, takes a little while to get going and spends the rest of the day -- >> how would you react to that? what would you do? take it as a buying opportunity and look for the next thing in the day after, would you sell
stocks, markets do trade down? >> i do get aggressive on selling futures. >> all right. gold is suffering again today dropping back below 1600 to cap off a dismal future quarter. let's go to jackie deangelis with more. hey, scott. not only has gold fallen 5% this quarter, but it's set to suffer its first back-to-back quarterly loss since 2001. so will the second quarter bring better news for bullion or is this trade done? let's talk to anthony, gold can't rise on the big concerns surrounding cyprus, is there anything that can turn it around? >> no, jackie, there isn't right now. today is a perfect example. you brought up cyprus and the weaker dollar, which would be supporting the gold, but yet we are down $10. the shorts keeped aing to positions in the market. and if we get another jobs number like last month for the next two months, then you'll be talking gold down three quarters in a row. >> rich at the cme, gold hovered near 1600 dollars for the last
couple weeks, if we break that number, what's next for gold. >> jackie, a close below 1590. every retailer says we retest the lows and last year's lows go lower. take a look at the chart here, a picture speaks a thousand words. we have been in a complete down trend. bulls need a close way up above 1630 to really get some momentum. and i think right now with the positions that grossani mentioned, the shorts are putting more pressure to the downside. >> technically doesn't look good for gold. now you know what rich and gris are doing, but what about you the viewer? hit up cnbc.com to vote there and we'll give you the results on the 1:00 p.m. show. and you do want to log into this one because peter schiff is ready to make a bold call on gold. is mr. goldfinger himself ready to throw in the towel? find out on futuresnow.cnbc.com.
that's at 1:00 p.m. thank you, jackie. see you at 1:00. where are you on gold? >> the biggest short is with the gold miners. >> i'm not surprised he said that. >> but gold miners are very different than gold. >> yes. >> what's the difference between the metal and the companies? >> in this case, first of all, to some degree, it does reflect my position in gold. >> in other words, the following price of gold, right, if you think that's going to continue, is that the reason then you're -- >> yes, gold couldn't be lower. we have done well over time buying gold and coins, but that's a different ball game. gold is definitely a downturn. coming up, laszlo reveals another top pick of his and he'll say why this chart is worthy of his endorsement. plus, nike is higher today but investors think it is time to get short. we'll be back in a couple minutes.
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all right. time to reveal another one of laszlo's top ideas. drul roll, please? i see that ticker, you say what? why do you like salesforce.com. >> we first got to salesforce.com two years ago. the stock was trading at 100 times earnings, and yet the stock didn't go down. so it told us that as always it was intriguing. theories have done well. the stock has done well. it will come back smartly, it's all the classic things you look for. >> the stock is underperformed here today. i'm sure you are familiar with that. the stock has done well over the
last three years and has been off the charts d. you take any negatives from oracle's most recent earnings report, which was awful? >> i like oracle because if they were right, and it was because of new sales personnel. the product and business model was still intact, that to me is an opportunity, because it's a nonrecurring kind of news. you know, one of the great stocks the last couple years has been newscorps. we bought it trading at 13, but the business model is still there. fox is still there and they are still making movies. i like the situation where is the stock reacts emotionally and the underlying story -- >> the stock is trading at estimates, newscorps was trading at two times the stock at the time? >> it is a huge premium and everything else. we looked at it being 100 times -- >> do you think the stock will change character to some extent?
maybe become less volatile? >> more volatile. >> because it will be smaller in price. okay. listen to the biggest pops and drops in midday trading. chicago bridge and iron popping 5%. the company raised items today and they increased their rewards, much better than expected. it is just beginning and one of the cheapest stocks. >> wise? >> the quarter was good. however, they lowered the guidance for 2014. the reason being the acquisition is going to cost them more than they thought, so they overpaid for it. i don't think it's a big decline. i don't think the stock will trade higher. >> it's just a classic company extremely well managed. one misstep. they have great brands, great business. >> stephanie, can you give me a comment on pbh? >> i think they are doing a good job, but jeans are the problem. and until you see a recovery in that segment, that's a very competitive segment. not one i would buy. >> biogen is popping 4%. >> the stock continues to amaze.
it's 36% since january. relative strength here is 80, which is off the charts, but that's going to be torrent to justify a move like this. momentum needs to follow through. they have a new drug, two big upgrades on the street, no reason to sell it if you are along. i would not chase it, though. >> a little above for southwest airlines. >> here we go with the airline sector. one of the reasons the transportation sector has done so well, i am like laszlo and missed this run. i'm not interested in correcting my mistake up 2%. if i was in it, i would take it off the table and sell it. >> up next, we continue to reveal laszlo's top picks. should you follow suit? two of to the best, link, wise, ali, frazier, tyson, holyfield, leonard, they put on their gloves for another showdown you won't want to miss. tdd#: 1-800-345-2550 when i'm trading, i'm totally focused.
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coming up on "power lunch" in 13 minutes' time, the s&p 500 clearing its record all-time high close. will it be able to hold that record? we'll discuss that. walmart considering a plan to have in store customers deliver orders for online buyers. now, would you, would you want a complete stranger knocking on your door bringing you your parcel? and the power house. we are traveling to the nation's top housing markets. this time find out what your money buys you in chicago. scott, back to you. chi-town, love the windy city. see you in 12 minutes or so. mike is higher after goldman sachs picked up coverage with a birating of a $70 price target. should you go along with goldman? we'll debate it. stephanie is our bull, steven wise is our bear. 1:30 is on the clock. stephanie link, the floor is yours. >> i like the fitness industry. you're seeing secular changes, more people are working out,
demographic changes in women and children. i think nike is positioned well to continue market share. they have very good pipeline products in footwear as well as other categories like basketball. they've got this new technology, which i also think is going to gain a lot of excitement as well. fly net and i think that overall they're positioned well. and gross margins are starting to improve. they are getting the pricing and costs are coming down and most importantly inventories are getting under control. >> first of all, it's called josh here to agree with stephanie in part. however, stock right now is selling at 23 times selling at a 50% premium to the s&p which makes it over value. the company is saying their futures orders are back-end loaded. yet china continues to support it down 9%. inventories are still very full there. i think at this point you can get it at a much better price than now. moving the stock is short
covering. it doesn't have a high shortages, but we talked about, what do we do here? we are disappointed in covering it, so i think i'll be able to buy it 10% lower than where it is. >> i would agree on you. the lower. >> i do think that something different is happening in china. i do think they had a lot of competition from the chinese local companies and they are starting to price them out of business. >> it's heating up with brooks and asics and adidas. >> i'm a mello hater. that alone, i'm going against you. >> what's his name? lebron? lebron. yeah. >> the fastest selling sneakers. >> it's going to grow. >> next year's numbers. >> aren't there rules? >> there is.
but there is a lot of support as well. >> a lot of agreement going on. >> i agree with both of them. we're going to have the results at the end of the show. who had the more compelling argument? >> i agree with the bearish case. >> i think it is a crowded space. this stock seemed to be hanging around for a long time. >> we have saved the most surprising top pick for last. you will certainly not want to miss that. check out this nugget of research. are the marks overinflated relative to what the u.s. economic data is telling us? it seems consumers are still very wary about the economy with surges for things like online coupons and hotel deals up versus the year ago period.
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shld. laslow? >> it's sort of back door real estate play. the other is that mr. lambert bought a lot of the stock for his personal portfolio. i don't mind going into partnership with somebody who has had a good track record over time. >> a lot of cost cutting. sales at sears holdings every year. what about the fundamentals of the story? >> don't matter. this is a stock where you don't have to look at the balance sheet and other things. >> you don't think they have to spend so that they can sell the real estate? >> they don't. >> but don't you think that he actually bought the shares from his fund because investors are ready to redeem because of the
steers in there? there was no way to sell it into the market? >> maybe he did. it's up 20% this year. >> you like amazon? >> we own amazon. >> you don't care about the valuation? >> it scares the heck out of me. >> that's a perfect word we'll come back with final trades. ♪ [ laughter ] ♪ [ female announcer ] each one of us is our own boss. ♪
all right. earlier in the show we asked you to weigh in on our nightly debate. we tallied the results and you said stephanie ling. our bull made the better argument. on that note -- let's do final trades. josh brown? >> i think hess is really interesting going into the shareholder meeting in may. i'm buying. >> i like the way