tv Fast Money Halftime Report CNBC November 17, 2014 12:00pm-1:01pm EST
$100 billion deal day. >> s&p capital wrote this morning that tech, as a sector, is only ranked fifth in m&a behind consumer discretionary, energy, health care and financials which is amazing. let's get over to the judge as he takes over the half. all right. carl, thanks very much. welcome to the "halftime" show. starting lineup for today, josh brown is the ceo of ridholtz wealth management. joe ter nova, director at ver tis investment partners, stevewise managing partner of short hills capital and pete najarian of options munster. no better place to put your money than right here at home. the good old usa. latest proof, word japan slipped back into recession. a stunning turn of events for an economy juiced by central bank stimulus and one in which big
investors have bet great sums of money op. chief international correspondent michele caruso-cabrera right off the top it with more on japan with those bad numbers last night and more news out of another troubled place and maybe being taken is good news, europe. in europe, michele. >> absolutely. in an economy that can't get out of its way, many are begging mario draghi to do quantitative easing like they did in the united states. the head of the european parliament, mario draghi did say an option is for the ecb to buy government bonds. the first time he's said that. as a result take a look we'll show you the italian market intraday as one example. most of the european markets look like this. right here when mario draghi said that, pushed the markets sharply higher across the board more than 1s% for italy. take a look at where italy was in the morning. deep in negative territory as were most of the european markets because of the first news you were talking about, the japanese market, which got hammered overnight by nearly 3% because of their gdp numbers.
economists had expected a gain of more than 2% for japanese gdp. instead it declined 1.6%. a real kick to the japanese central bank trying very hard quit quantitative easing there to try to turn things around. another very bad troubled spot, petro brass. can't get out of its own way either hammered again today when they announced they will miss their oil production target for 2014. on friday they announced they don't know when they're going to publish earnings. audited earnings. the massive corruption scandal going on. on friday the company offices were raided by investigators across the country looking into what is being called the car wash scandal because of money laundering accusations. the bonds are getting hit too. i want to show you. this is the price of the bond, not the yield. they had been trading above par just a couple months ago. and now they're trading at like 94, 96 cents. all right. and finally, the uk prime minister today, david cameron, warning of another possible
financial crisis through an op-ed published in a british newspaper. quote, he says red warning lights are once again flashing on the dashboard of the global economy. which makes the united states look good relatively speaking. >> and that's still the question, michele, whether, joe, the u.s. really is the best place to be? >> i think absolutely it piz. we've talked about it at length over the last couple months that it is. when you look at what's going on with japan right now, it would be troublesome if the yen reversed its overall trend for 2014, which has been down. the yen is down today. okay. yes, the nikkei is down, but the more important trade to global speculative markets is the carry trade where you're selling the yen, going out and buying other pro risk assets with it and it comes back to the u.s., that's where right now investors want to be. i continue to use health care as the example. domestic revenues, that is not a defensive play, that's a growth play. >> steve, jpmorgan out today, they up europe to overweight. they downgrade the u.s. to
underweight. they say more value is over in europe. >> yeah. i disagree with that. take a look at the indices, the msci europe, you have financials that are 22% to 23% weighting versus 14 here. then you've also got it technology which is only 3% rating -- weighting there and 19% here. so it should be a cheaper market. by the way, selling at the average p/e it has for the last 15 years. until draghi does something i don't think the europe market moves. number two -- >> don't want to get ahead of it? >> ultimately going to do it or still don't trust it? >> i still don't trust it number one. i can't imagine the european market moving up without the u.s. i think it em boldens the u.s. market so i would still rather be in the u.s. >> our next guest fay vors the u.s. over the rest of the world and thinks you can find good deals in our market. the president of u.s. trust overseeing $381 billion in assets. welcome back. >> good to be here. >> in the context of japan in recession for like the fifth time in three years, draghi making the comments today, we've had this huge run in the last
three weeks, where is the best place to put your money? best bang for your buck? >> i agree with joe and teev. we still think it's the u.s. we've been in that camp. we stay in that camp. the u.s. is the global driver. it's interesting, back in 2008 it was considered economic road kill. we were -- we finally got our come up its. we are driving global growth and we will continue to drive global growth. >> josh? >> i think that's demun strable true. we drive global growth. when you think about more than just between now and the end of the year or next year something to be said for international holdings in a portfolio context. look at three-year returns on the msci which is developed markets x u.s., we only outperform that about 50% of the time. the other half of the time foreign stocks outperform. nobody rings a bell when it's going to happen. from '03 to '08 european and japanese stocks did better than u.s. stocks. i think when you are building a
portfolio you want to have both. if you want to tilt toward u.s. because it feels bert, i get that. i wouldn't argue with it. we're tilted that way. wouldn't you agree that you're going to have to own everything if you really are investing for the long term? >> absolutely. i wasn't implying we only own u.s. we were overweight the u.s., right now we're neutral weight emerging markets, we're equal weight international markets. we still think the best bang for the buck over the next 12 months plus will be the u.s. agree with you, balanced portfolio, i was just referring to what would be over versus more neutral weighted. >> a reminder, though, of why people say the u.s. is the best house. in a bad neighborhood, japan shocking with the gdp numbers, cameron dropping the bomb of maybe another financial crisis related to what's happening over in europe, you've seen what's happened here with energy. falling out of bed really the last few weeks. >> right. >> you like it, though? >> we do. look, we believe that a lot of
the more recent pull back had to do more with financial contracts than supply and demand. the bands come off. right. we know that. it's come off because japan has come off because of china and europe. look at supply and demand, it's reasonably imbalanced. what we look at also, is over the next five years, about a third of the production that's supposed to come on needs oil at $80 or higher to be economic. and that includes some of the fields in the u.s., in canada, so it won't take a lot for that supply demand to get back out of balance and we still think it's a good hedge given all the things going on geopolitically. >> keith, what do you think, getting away from energies one second, the financials, they're trading near 52-week highs when you look at the xlf. certain spots or where in the financials? i know you're bullish on them? where are you bullish and why? >> we still like broad based financials, pete. we're bullish because we still have not seen the yield curve, yet to come, and when that
happens that creates a lot of profits for financials instantaneously. financials will -- and the banks in particular, will benefit from a strengthening economy both in the u.s. and globally which we think will continue to happen. that helps dread it quality, et cetera. we like a broad exposure to the financials and continue to be overweight that sector. >> do you think the muni run continues? it's been a great last year for muni bond investors. >> we do. people have continued to be a fr -- afraid of munis because you get headline risk. >> you get rate risk at some. >> you get rate risk. that's true tore all fixed income. most concerned about trushryes in that -- treasuries in that regard. and in munis you can't just buy the sector. you have to make sure you know where you've got the coverage from tax receipts other otherwise. but in general yes. >> do you think we bore rod some of the gains in october from the end of the year? this is one heck of a v from october 15th. >> you're right, joe.
we have not changed our end year forecast. we said at the beginning of the year we thought we would end the year between 1950 and 2000. we're still right around there. we think next year, given our outlook for both the u.s. economy and the global economy and the fact that we think profits will grow by another 8 or 9%, we think that's probably what you look for next year. >> it's amazing. throughout this entire year, the guy ragss that we've -- gyrations in the market, you didn't adjust your target one way or another? >> no, we didn't. people, you know, it's a very nervous market and investors are overreacting to good news and bad news. we keep looking at the fundamentals, underlying earnings, p/e multiples, underpinning with respect to growth best here and globally and our -- both here and globally and our view has not changed much despite the volatility around it. that's why we've kind of stuck to the forecast that we've had early on. >> good to see you again. >> good to be here. >> thanks. u.s. trust. coming up activist agrees to buy botox maker allergan for $66
million. what does that mean for valeant and bill ackman? and who could be next? we have a top health care analyst mark showbound on that trade. trading the apple juggernaut. the stock enjoying a nice ride recently. the company making a big play for chinese customers as well. joe ter nova is riding apple's wave for trader of the year. another stock is giving john najarian's portfolio a big boost today. can he knock joe out of the top spot? it's a close race. it's the fourth anniversary of gm's ipo. that's got two traders revving their engines for a fiery debate on that stock. take a closer look at your fidelity green line and you'll see just how much it has to offer, especially if you're thinking of moving an old 401(k) to a fidelity ira.
it gives you a wide range of investment options... and the free help you need to make sure your investments fit your goals -- and what you're really investing for. tap into the full power of your fidelity green line. call today and we'll make it easy to move that old 401(k) to a fidelity rollover ira. shyou see this right? it's 80% confidence and 64% knee brace. that's more... shh... i know that's more than 100%. but that's what winners give. now bicycle kick your old 401(k) into an ira. i know, i know. listen, just get td ameritrade's rollover consultants on the horn. they'll guide you through the whole process. it's simple. even she could do it. whatever, janet. for all the confidence you need. td ameritrade. you got this.
pretty good looking chart right there. down, apple was are probably profit taking. stocks on a huge run. overall market share lead keeps getting bigger. joe ter nova has been riding this one and pete. >> the stock in both of your playbooks. >> yep. >> people maybe taking money off the table because the stock was up off the open. >> i'm holdinging it in the playbook and personally. i said a couple years ago i had given up the premise of trading apple. i traded apple in the last couple years, 2011, 2012,
horribly. the best thing i've done, invested if apple, own apple and don't look at it. >> the stock would be above 800 bucks today, pete, if not for the seven for one. >> everybody would be talking about it because of that number. >> still talking about it. >> i don't know -- they're talking about this would be 800 but everybody in the past would have said it's $800 stock. the laws of large numbers and all that crap that we always hear. i think this stock goes a lot higher from here but the paper in there tells me that, joe has been stick with it, i'm sticking with it. we had guys going out and buying the 123s today. the stock is going higher. >> to his point think about where google is, does that mean google should be doing the same thing apple should be to restore the positive mow pen tum. seems as though google is moving sideways an maybe they need the financial engineering in their price to get the mutual fund industry. >> two things, very quietly google killed wallet last week and everyone kind of felt like it was coming. apple is seeing substantial inroads in apple pay. we could get headlines by the
end of this year with actual metrics and superlatives and i think that has a lot to do with why the stock has been doing so well. there is a sense they're innovating again. google failed in that area. the other difference is, apple has had activists in the stock, listened to them, has done some of the financial engineering. google turned itself into "the new york times" three years ago. they split the share class. they're not taking orders from anyone. it's two very different approaches and it's not that one is better than the other, but i think in the share price, joe makes a good point, you are seeing the difference between a much more shareholder friendly company that's perceived as innovating and then a different kind of company -- >> you should have had apple in your playbook. >> i own it in real life which is where i get paid. >> i think 2015 you might see something from google that makes google look in '15 like apple did in '14. >> you should have apple in your playbook. >> berkshire hathaway from 1969 in my playbook. i don't have a time machine. wish i did. >> another one of our traders is getting a bump in the playoffs. dr. j after halliburton agreeing
to buy ray val baker hughes cash and stock deal we talked about last week valued at nearly $35 billion. baker hughes surging more than 10% this morning as we said, that stock is in doc's playbook. as i look at the leaderboard it's a tight race at top. is it 24%? there we go. thank you for that shot. doc is it 21%? he joins us on the phone as well. doc, i guess we thought this was going to happen. now it did. and now you're getting closer to joe. >> yeah. and i think there's still mogasn the tank, judge. >> not taking your money and run. >> no. we have this in the playbook and we have it for the wealth management clients. we talk to the clients and they agreed with us on the assessment that basically what you've got is some ar by tros in hedging that goes on when you have a merger of this sort, especially when it's stock and cash. the cash portion, of course, is 19 bucks. the stock is 1.12 shares of
halliburton. you're going to get the baker hughes shareholders will get that is. you put them together and the stock is still trading in our minds about 7 to $8 under where it should. so we believe that over the next several weeks, as the arbitrage continues and as people get hedged the stock will migrate more towards that 75 or approximately that number, maybe it's 72, judge, maybe it's 77, but somewhere in that area, i would be exiting this trade. but instead, we're going to hold it. we had a long conversation about it with all those guys and we think that from the people we talked with on the debt side, that this is going to be quite good. this combined company. >> right. >> halliburton is going to earn or did earn this year $4 a share. i mean the p/e is just sick as far as inexpensive, so we don't think this is an opportunity to get out. we think it's an opportunity to
build the position bigger. >> i thought we were going to get you to do your first trade of the year. >> almost. we almost did. but then we sat there and as we were looking at the arbitrage, that's virtually all the trading desks are doing today, is that arbitrage between selling out of halliburton and buying baker hughes and then hoping that they get that with that $19 toss in there, they're going to make most of that 7 to $8 discount. >> right. >> that it's trading at right now. so we think that's upside for us and for the client so we're going to hold. >> all right. thanks for calling in, appreciate it. >> thank you. >> again that top of the leader board is getting awfully tight. coming up, ackman's next move. the hedge fund giant's plan after the allergan activist deal and we're going to hear from evercorp senior managing director dr. mark shownbound about how the deal will impact the industry as a whole. happy anners have gm.
after the government bailout, piece is on board, weiss not so much. today's debate and it's next. >> the 2014 playbook playoffs. seven cut throat traders. locked in an epic battle to prove whose portfolio will come out on top. taking profits, adding to their positions, all in the quest to be named trader of the year. find out who's leading, who's lagging and who's ready to make a move. take a closer look at your fidelity green line and you'll see just how much it has to offer, especially if you're thinking of moving an old 401(k) to a fidelity ira. it gives you a wide range of investment options... and the free help you need to make sure your investments fit your goals -- and what you're really investing for.
ameriprise asked people a simple question: in retirement, will you have enough money to live life on your terms? i sure hope so. with healthcare costs, who knows. umm... everyone has retirement questions. so ameriprise created the exclusive confident retirement approach. now you and your ameripise advisor.... can get the real answers you need. start building your confident retirement today. (shouting) location. here's the location that matters the most. here. or here. or here. it's wherever this is. to get customers to come here and stay here, you're going to need an app that connects to all your systems. so they can bank, shop, do what they need to do, and you gotta do it fast. before the competition does.
it's tough out here; you better be on the right cloud. today there's a new way to work. and it's made with ibm. welcome back the four-year anniversary of gm's ipo following its bankruptcy. the stock is down 2%. is it time to buy in? should you bail out of the automaker? let's debate it. logon to cnbc.com/vote decide the winner in real time. pete the bull, steve weiss the bear. pete, make your case. >> when looking at gm right now, has all the news been priced in?
i'm starting to feel like it is. a stock well over $40 a share pulled into the low 30s now. when you look at growth and the fundamentals of this company that makes sense. obviously a news headline out almost every day, ken feinberg on today talking about some of what might be here to come. they've extended some of the period in which people can have their claims in there. i think as that's come out we've seen less and less of a reaction. when you look at the funds it's about margins. what's the two best markets? china and north america. when wyou look at the growth th markets in north america have been outstanding. the revenues continue to grow. fundamentally the company in the right direction it's about headlines. >> i'm not negative. i'ms just not buying gm. the reasons are that management one misstep after another misstep. management still inbred. the new ceo she was there when this happened and was in charge of part of the supply chain. we don't know what the extent of the brand damage is right now from this and very competitive market, where we're starting to
see incentives, i think as i said there are better places to go for your money and a broken momentum stock. every fund, not just hedge funds, every long only owned it last year. on this year's numbers, it's much more expensive than ford. you have to bet next year. i would rather stay on the sidelines. i don't think the risk is great bit the reward isn't that great either. >> where are they getting their success? through the suvs and pick-up trucks. that's where their strength is something. when you look at the price of oil today, $75, those big vehicles with the lower -- into you get that with bmw. >> you get that with ford but the same types of numbers. they got the numbers of an audi or bmw when you look at the margins. >> we takes the vote where it is and debate it on the desk and see if we can sway it. >> pete with the bull side. number one, i believe gasoline prices falling 20% is going to have a positive impact. secondly i think purchases were held off for the redesigned
models for the suburban and cadillac. i think that benefits them. >> josh brown. >> i'm going with steve. i don't dislike the story pete is telling but there are better places to be. technically this stock is up against the declining 50 and 200 day. it's in a downtrend. i don't see what the rush is. >> what's a better place to be if there is one as you say? >> in the auto space, tesla, ford or mobile i and outside of the auto space 6,000 stocks to choose from, many of which are much closer to 52-week highs trending upward solid fundmentles. this is tough. >> pete, the last word and the vote split. last minute votes coming in. >> my last word, i think the problem with what josh is talking about, the stock has been moving from the downside back up. it's at that 50-day moving average. >> it failed at that level in october. that was resistance. >> it failed in october but up there now and holding on that 50 day. i think if it can hold there, close there and then all of a sudden -- >> should get a discount.
they came out and said we were wrong. more deaths. it's been going on for longer. by the way, we ordered parts even before we reported to the government. >> that was going back and forth to the end. bull case winni ning 51 to 49. closed it a second earlier it would have be been the other direction. >> facebook at work. everybody doing it, but do you trust mark zuckerberg with your professional network. see if the traders are liking this new idea. next allergan strikes a deal but not with the company bill ackman was hoping for. so what's the trade now? we break down the action with kate kelly and top pharma analyst dr. mark shownbound after the break. it's monday. a brand new start. your chance to rise and shine.
with centurylink as your trusted technology partner, you can do just that. with our visionary cloud infrastructure, global broadband network and custom communications solutions, your business is more reliable - secure - agile. and with responsive, dedicated support, we help you shine every day of the week. centurylink your link to what's next. ♪ (holiday mhey! is playing) i guess we're going to need a new santa ♪(the music builds to a climax.) more people are coming to audi than ever before. see why now is the best time. audi will cover your first month's payment on select models at the season of audi sales event. visit audioffers.com today.
welcome back. mixed market today. see the sectors leading the way, defensive play, utilities. joe, energy the laggard. you were talking about the russell puts. >> here's why. an example of trying to create some -- create some beta within the marketplace. russell has gone down about 1.8% since thursday morning when i put on the put position. i've covered probably about three quarters of the position now. what's important to understand is when you think of the energy weighting in the s&p it's about
9% and the russell it's about 4%. to your point now, okay, oil has been a laggard. year to date, the energy component of the s&p is down 2%. but the russell component energy down 22%. that's where the vulnerability is for the energy companies, the ones predominantly on the russell. >> if oil keeps dropping the way it has? >> absolutely. oil hasn't bounced. oil is at 75. opec has to cut. >> the whole russell has been crazies this year, up 6% last month, down 6% the month before. small cap going crazy all year long. >> jump in real quick and send it to diana olick who has breaking news. hi, diana. >> the government's mortgage insurer back in the black. insurance fund went negative in 2012 requiring it to draw on additional taxpayer tax but according to aggressive policy action it's above water. negative $16 billion to now a
positive $4.8 billion, that's a $21 billion gain in two years. the policy action included raising premiums and average fico scores for borrowers and going after rogue lenders who didn't follow fha's underwriting. fha's capital reserve ratio required by congress to be at 2% or above, is still at 0.41%. though it is projected to clear 2% now by 2016. in a briefing to a small group of reporters this morning hud secretary hulen castro said the fund mentals of the fund are strong, recovery raids up and delinquency rates are going down. i asked secretaries castro if he was concerned about shrinking fha volume and fannie and freddie taking market share he said no. the gse returned the return of a cheaper 3% down payment low. secretary castro would not comment on whether or not fha would consider lowering the annual premiums to help open up credit to more borrowers. much needed credit. more on-line, reality
check.cnbc.com. >> i will use the opportunity to ask you about a home builder. you have beezer in your playbook. >> i looked last week and the numbers out of the home builders were impressive. we've got all kinds of numbers coming out today. i mean i really thought that beezer would perform far better than it has. it's been the biggest disappointment in my portfolio. >> why haven't you dumped it and done something else? >> i believe in the story. unfortunately i'm starting it run out of time on the story. unfortunately it ran from the moment i picked it and put it in the portfolio in late december, ran to the end of the year and since then it's been dipping. >> let's talk about the health care deal of the day. take a look at shares of allerganp up on the news it's agreed to be bought by actavis for $66 billion. valeant had a lower bid out for allergan, backed by bill ackman and its shares are in the green too. another ackman stock also on the move today on this news is
zoeetis. figure out what this means, what's next, what does valeant and big ackman do? is zoeetis a target? bring in cate kelly all over the hedge fund trade in which many of the stocks we have spoke about have been a big play. >> it's true, scott. we looked at interesting data showing who's benefiting from the moves you spoke of. speculation on how allergan will have been a huge winner for ackman who's kept mum about the latest development but plans to push ahead with the special shareholder meeting he hopes to have even if the valeant deal he originally sought fails in light of a sweeter offer from actavis. ackman's pershing square the single beneficiary of allergan's gain this year and the stock accounts for 38% of sper shing's long stock positions. at least according to data crunched by sem metric, a market research firm in new york. other hedge fund beneficiaries include pera, pent water capital management, another activist fund founded by pershing square
alum investing alongside it in zoeetis and jerry farber llc. on the activist side with the stock up huge this year and today on news of a planned deal in the name see funds like light speed management, os ki capital management and satchem head and twin securities. a great day for folks all around, scott, and a lot of interestings crisscrossing paths when it comes to the investments. >> great day headlining by ackman. he will walk with more than $2 billion in profit after giving valeant its share in their profit sharing agreement. >> sure. and i was just looking at the recent public report from pershing square holdings his public vehicle and as of november 11 they're up 40%. they've been up 25, 30, now 40%. and i'm sure that's thanks in some part to allergan here. another interesting thing apparently those shares are available to u.s. investors in europe as of today and they're up just a hair. >> the litigation going on
between allergan and pershing square and valeant against the other guys. my guess they end up dropping litigation on both sides and take a walk and see what's next. >> could happen. i think we'll see the strategy out of him again in the near future. >> speaking of what's next, bring in mark, the senior managing director for evercorp isi's health care research team. welcome back. >> thanks for having me. >> i know you don't cover the specific parties involved actavis allergan or valeant, what does that deal do to the universe you cover and zoeetis is one of them which ackman has a big position. some are wondering whether it is next. >> yeah. it's interesting, so, you know, the press reported that pfizer perhaps was interested in actavis. one when ders now that actavis has its arms wrapped around allergan whether if, indeed, that press report is true, whether pfizer would still have interest in a combined entity of an actavis and allergan. and then on zoeetis.
it's disclosed bill ackman's fund pershing square has take an large position in zoetis. we don't know what their plans are with that but if -- if ackman and his fund flol the recipe so to speak for activists typically they want cost cuts. which raise earnings. and they tell companies look, if you don't do it, sell yourself to a professional cost cutting organization. my guess is that's the angle they'll end up taking. i don't know. next week on tuesday a whole zoetis management will get up in front of wall street down at the new york stock exchange and defend themselves. they have a analyst meeting first ever analyst meeting as a public company. that i would imagine will be pretty interesting. >> yeah. i imagine. we're seeing zoetis shares up better than 2%. to make sure we're all clear here, do you think that zoetis gets taken out by somebody? >> i don't know if zoetis will get taken out by somebody.
is zoetis an attractive business? absolutely. there's scarcity value in zoetis. no other major publicly traded companies. can an entity buy them and cut costs and not sacrifice the business? the answer is unknown because there's very little precedent. tomorrow at this zoetis analyst meeting we'll see what company has to say about that and will go a long way to me and the rest of wall street understanding whether a professional cost cutting organization could come in buy zoetis and extract the cost savings. >> it's steve weis. j michael pearson the ceo of valeant came out in january and said he wants to be $150 billion market gap. he's under $50 billion. so who's his next target to help him get there? >> yeah. i don't know how to answer that. i don't cover valeant. you have to talk to my colleague who covers valeant. >> if you're a market cap big enough to get them there. >> you can make a list of
companies with $100 billion market capsp. that's easy to do, astrazeneca, pfizer, companies that would meet that market cap definition. he wouldn't have to do it all at once. you could buy two $50 billion or four $25 billion companies. all kinds of, you know, ways to -- all kinds of ways to do that. >> i do think it makes sense to see valeant get involved ins here in the situation like this. i don't know what the synergies are between an animal health company and other holdings. may not be the best fit. pearson has said he's very much a fan of these sorts of deals and i expect to see ackman go through another one of these again. so the fact that those stars could be in alignment is some hint of a possibility. >> before we lose you you raise the question at the very top of this interview about pfizer's potential interest if there is any at all. what's your best guess? >> i think pfizer has stated
they're interested in the concept of doing a big deal. first we went after astrazeneca, appears that's not going to work out, pfizer did a research and development collaboration which only takes the probability down they're going to go back after astrazeneca. the press reported numerous press outlets over the last couple months pfizer may have had interest in actavis, that could make sense. why? because pfizer ultimately over the next three or four years might split up. one of those companies is basically a generics company but a company that's not -- it's not fully mature and buying actavis with the generic capabilities actavis has could in theory complement the generics business inside of pfizer. now that actavis has its arms around allergan this is far more complicated and not clear something pfizer would be interested in yet. >> that would be one heck of a deal if it did happen. thank you so much for calling in today. really appreciate your insight and expers tease. >> thanks for having me. >> dr. mark shown balm.
pete in pfizer and merck. >> and bristol and lily. merck with the cholesterol drug that stock on the move. >> yeah. >> you heard what he said about pfizer. give me your take. >> when you look at these names talking about names everybody loves it use the word defensive. i never viewed them as defensive. either they're growth or not. they've been growth, valuations solid and they've been able to put themselves in a position to make some of these big takeouts. does it have to be 100 plus billion. i don't know that it does. one thing mark said what if it's a multiple deal far less, $20 billion, versus the $100 billion. there's an upside in all of these names. >> coming up, thank you by the way, kate, could this be marissa mayer's time to shine. investors waiting and watching for the yahoo! ceo for something to happen. this friday pay be a now or never moment. eric jackson live after the break to tell us why. is hasbro's hollywood dream over? the latest on the talks to bring
dreamworks studio into the toy giant's portfolio. we're back in a couple minutes. ♪ for tapping into a wealth of experience... for access to one of the top wealth management firms in the country... for a team of financial professionals who provide customized solutions... for all of your wealth management and retirement goals, discover how pnc wealth management can help you achieve. visit pnc.com/wealthsolutions
changing the way you think of retirement. transit fares! as in the 37 billion transit fares we help collect each year. no? oh, right. you're thinking of the 1.6 million daily customer care interactions xerox handles. or the 900 million health insurance claims we process. so, it's no surprise to you that companies depend on today's xerox for services that simplify how work gets done. which is...pretty much what we've always stood for. with xerox, you're ready for real business. coming up on power lunch we hope you will join us as stocks in the u.s. march to record highs. china opens up a whole new world for u.s. investors like you. it is an unpress denned move. we will talk about what it could mean for your investing strategy now and portfolio down the road. oil continuing to plunge. the mid terms are over, looks
like the keystone pipeline will likely get approval in congress. of course what the president will do is another matter. but if it does go forward, we will tell you about the stocks that are likely to benefit from the pipeline. plus, a mystery mexican mansion and brazil's once great oil company going down in flames, perhaps the latest on the scandals rocking those two major emerging countries. now back to scott on "fast." >> thanks so much. do our trader blitz, four trades on four stocks making news. first up linkedin lower on reports that facebook developing a work place version. beet? >> right. going right at the attack of not only linkedin, but after microsoft and google as well i like what they're doing right now. they have the built in users, billion plus users. any conversion out of that i think this is a big win for them. i don't think it's immediate but over time great job right now by the management looking ahead. >> josh, pg, procter & gamble grown graded today.
>> right after it hit an all-time high. this is more of a stock to hold than a stock to trade. buffet's sixth largest position, 2% of the company, a name that ends up bounce back. might be looking at profit taking. >> joe, a fknockout for tyson. get it? >> i got it. >> that was a great tyson documentary on hbo last year by the way. the comments surrounding the hillshire synergy very strong. guidance for 2015 very strong. good is good. tyson moves higher. >> steve, dreamworks and hasbro, another one of these deals talked about. >> yeah. >> happen or not. >> tough year. i don't know but here's the thing. you're not paying for the deal to happen now. it's fall back to almost near the lows. if you want to bid in the acquisition you can. i don't think there's a lot of frisk here. >> reports maybe the deal is falling apart. people said this thing was fraught with risk from the get
go. >> you have katzenberg a key guy in hollywood would he be willing to take a back seat to the hasbro management. >> i think it's going to happen. >> you do? >> i do. we talked about it last week. the synergies make sense. i think it does happen. >> could yahoo! shares rise to 80 bucks? eric jackson thinks so. the reason may surprise you. $325 million man how one of the cheapest teams in pro sports managed to sign one of the richest deals in history. it's our worst trade. we'll fill you in later. .
welcome back. the s&p tech sector been on a run or what? 14-year high today at the open and within that, wow, tech is leading gains up 11%. yahoo! the top performing stock up 35%. and speaking of that company our next guest says friday is going to be one of the most important days in ceo marisa myers' career. the end of the week marks the end of the 60-day quiet period for yahoo! before it can announce plans for its alibaba shares it owns. eric jackson founder of iron fire capital joins us from the toronto stock exchange. good to talk to you. >> good to see you, stock. >> friday is going to be such a big moment what's going to happen? >> look, i think there's about $15 of share in value just sitting there waiting for marissa mayer to take it and what she can do to unlock that
value is announced, something called a reverse mores ris trust. basically a tax savings play. but it -- tax savings if it means a boost in the shares by $15, you have a bunch of hedge funds and other big shareholders lined up behind her saying, you. this is a way to make a sure fire good profit for us, and so i think she is going to make an announcement. it might not be friday, but it will be sometime between friday and january with the next earnings call coming sooner rather than later, though. >> wow. i thought they were going to do something sexy like go after aol, but tax savings? >> well, listen, i don't think they deserve any credit for how the stock performed over the last few years. i mean, i've own the stock since it was 11 bucks three years ago, and people are sick of my pounding the table, but they took a victory lap on the last earnings call like it was mayers' responsibility to get
the stock up to $52 here. they have been on the caboose of the alibaba express. right here, right now, going forward, mayer has the opportunity for three things to unlock value. she has to unlock the alibaba stake through a spinoff. she should, at the same time, unlock the japan stake they own because it's going to be another $3 billion of tax savings coming through that, and she's finally got to address the core business. she has not cut costs in a meaningful way, and done anything to get the revenue up. i think she can, she does all those three things, in the next 12 months, this is an $80 stock. >> eric, it's josh brown. curious why they look at aol as a savior. consider the fact that 100% of aol's profit is from people who forgot they had dial up accounts, and second of all, if she did something with patch, in
terms of that much money extended and that much of a flag planting, fist pounding, and then a retreat, she would be gone from the company. why do people think that's going to fix anything? i don't understand it. >> she did tumblr and told investors so suck their thumbs for two years until they generated revenue from the asset. armstrong and mayer, if i were her and heard about how good armstrong was, it would drive me nuts and want to stick a flag in the ground and do a lot of things to show up my critics, jackson included. i think she can do that with the tax plan and with a real con sen traitsed effort to cut costs. two years ago, mark said, you got to cut 10,000 people at the company at yahoo!. this is a wall street analyst saying this is tech legends saying this has to be done. >> eric, quickly before you go, stocks trading at 51 and change. where did you get in?
>> well, i've owned the stock since $11 in 2011 and before that. principally because i believe that this alibaba thesis would play out, it did not for a long time, now thankfully it has. i traded in and out of it. people are fussed about the rsi is this, come so far from 52 to 39. look forward, not back. there's 15 bucks a share of savings right there for them to take. >> go where the puck's going, right? you're up in canada and toronto, you know what i'm talking about. >> exactly. go cavs. >> thank you, appreciate that. better than the leaves. thank you. that's laughable. eric jackson. we have sad news to bring you today regarding our extended family on the halftime show. wall street icon jim lebenthal died friday at the age of 86, he was an expert and so much more and could tell a great joke as you found out on father's day. he's the father of who cnbc
friends, and he most recently joined the show this past father's day as i said. we extend sympathies to the entire lebenthal family. he was and certainly will be missed. the holiday season is here, which means it's time for the volkswagen sign-then-drive event. for practically just your signature, you could drive home for the holidays in a german-engineered volkswagen. like the sporty, advanced new jetta... and the 2015 motor trend car of the year all-new golf. if you're wishing for a new volkswagen this season... just about all you need is a finely tuned... pen. hurry in and get zero due at signing, zero down, zero deposit, and zero first month's payment on select new volkswagen models.
goodnight. goodnight. for those kept awake by pain... the night is anything but good. introducing new aleve pm. the first to combine a safe sleep aid. plus the 12 hour strength of aleve. for pain relief that can last until the am. now you can have a good night and a... good morning! new aleve pm. for a better am. at wvalues matter.ket, so the fresh fruits and vegetables we sell support organic and sustainable farming. grown locally on over 1000 us farms, and globally with our ethical trade program. rated for sustainability, and grown by people with responsible farming practices like stehly farms organics becuse to us, value is inseparable from values. whole foods market, america's healthiest grocery store.
ameriprise asked people a simple question: in retirement, will you outlive your money? uhhh. no, that can't happen. that's the thing, you don't know how long it has to last. everyone has retirement questions. so ameriprise created the exclusive.. confident retirement approach. now you and your ameripise advisor can get the real answers you need. well, knowing gives you confidence. start building your confident retirement today. it's monday. a brand new start. your chance to rise and shine. with centurylink as your trusted technology partner, you can do just that. with our visionary cloud infrastructure, global broadband network and custom communications solutions, your business is more reliable - secure - agile. and with responsive, dedicated support, we help you shine every day of the week. centurylink your link to what's next.
three things the traders are watching. that you might have missed. josh, you're up. >> i want to talk about illinois toll works. on friday, deutsche bank had a report saying this company could be the next 3m, pointing to the different things the company's doing for shareholders and their business. point to the fact if it sold at 3m's forward valuation, it's 25% higher. an interesting story. stocks should break a hundred. >> steve? >> hertz, it's a wild ride, up, down, positive today, carl icahn
still there. >> pete? >> gopro, everyone see it as a great opportunity, it is, trading over $81. understand there's rirvegs here, we know what the multiples are now in gopro, but when you get the opportunities, you have to take advantage >> the worst trade is not a trade. it's a signing. a record one at that. reports that baseball's miami marlins have agreed to terms with jim carlos stan ten on a 3 year $325 million deal. the richest ever in the big leagues. finished mvp this year, but here's the rub, marlins have not had a winning record in any of the first five seasons, have not made the playoffs since 2003, and furthermore, they were 27 th out of 30 teams in attendance averaging just 21,000 fans a game. >> that deal brought to you by quantitative easing.
>> i'd rather have five josh browns than one stanton. >> jeffrey, the owner, is an art dealer. some have obviously speculated that the art market itself is in a tremendous bubble. you have to wonder what this baseball signing says, not about its own market, but about the art market. >> one guy at the desk defends the deal, and here's why, a 24-year-old guy, and now look at this franchise, how long will they be there in south florida? that's the question. >> look at sabathia, other big deals, doesn't make sense. buy dodgers for seven multiple for this contract. i'd rather own a team than tv rights. >> can't do it by himself. marlins have young talent, good he's there, but he'll opt out, do well, great play he'll go to the yankees when he's 31.
>> so you hope. around the horn, final trades, what and why, pete? >> gopro, the run pushes the stock up to 90. >> steve? >> volatility is cheep. own it here. >> sjm. way to play it. >> stw, headed to a hundred. >> thank you, guys, that's all for us, have a great day as well. see you on the other side. power starts now. halftime is over, and power lunch and second half of the trading day start right now. scott, thank you so much. a new world opens up to investors like you as we speak. bob pasani has mechanics, and a pioneer in the market is standing by ready to tell you how to play it. it all has to do with china. chocolate scare. yes, ladies and gentlemen, several reports this morning saying we are headed for a global cocoa crisis. we did some in-depth reporting of our own to show you where things really stand. and i love that chocolate pepper manipulate bark for the