tv Fast Money Halftime Report CNBC January 23, 2013 12:00pm-1:00pm EST
ads. because people who are browsing snippet are browsing a particular topic, say you're interested in pollution or technology or mobile or finance, we're able to provide very targeted ads that result in high montization. >> maybe yahoo!'s ceo marissa mayer is watching "squawk on the street." let's get quack on the tweet. lou frankfurt saying he is focused on transforming coach into a global lifestyle brand anchored in accessory. the companies has wristlets, hats, belts, key chains and tech ak seccessorie accessories. what innovative accessory could help coach become a global lifestyle brand? coach can try selling some herbal life. maybe coach could make ultra thin wallets. and jeff writes an accessory with a michael ko rs logo on the side. keep an eye on coach after a
miserable report. it's down 14%. back on july 31st of last year it opened down 19% and barely budged off that all day long. a tough day for shareholders of coach. that does it for us on "squawk on the street." let's get back to headquarters. scott wapner and the "fast money" halftime. ♪ >> thanks so much. welcome to the halftime show. four hours to go until the close and here is where we stand right now on wall street. the dow is up yet been. it's been up nine of the past ten days. working on a 55-point gain. s&p is flat and there's the nasdaq with a slight move to the upside. the market's next leg with stocks on pace for their best january in 16 years. what are your best plays if the rally continues? firing the coach. the luxury retailer shocks the street and the stock is getting hammered. a trader debate on whether now is the time to buy. we're also keeping an eye on the nation's capital at this hour where a house vote on extending
the debt ceiling is expected within the next half an hour. we'll look in live when it happens. but first our top stories, waiting on apple. america's most valuable company reports earnings today after the close, and with shares down 30% from the highs, the stakes could not be higher. cnbc's jon fortt is live in silicon valley with the latest. jon? >> reporter: hey, scott. the main number to watch in this report is iphone sales. that's going to have the biggest influence on margins. if the iphone outperformed, it's also going to have an impact on revenue and ep s. take a look at some estimates out there for iphone sales. i think the street's consensus is between 46 million and 48 million units with some moving higher in recent days. for ipad sales consensus is around 23 million or 24 million units. here is the thing i keep coming back to. verizon's numbers yesterday, i know it's a fool's errand to
extrapolate out to a global iphone, apple's penetration into verizon hit ridiculous levels last quarter. verizon activated more old iphones than total android phones. this debunks the idea that apple is getting less cool in developed markets. what it suggests is apple could be taking share from an drud and taking share with old iphones. so the question of what this does for margins, it could be positive if apple worked the production kinks out of the iphone 5 and if the h 4s was a depent percentage of the mix. >> certainly they will be in about four hours from now. jon fortt for us live in silicon valley. we're trading today's market action with pete and john na jair j jairian. ennis. >> apple needs to blow it out of the water. >> i disagree.
i think the sentiment has gotten so negative that the company doesn't need to do too much for the stock to rally. in fact, i expect that even a gher simply because the worst k fears were overblown. looking forward, i actually think the bigger issue for me in terms of the report is going to be what does second quarter guidance look like. i think the holiday sales are going to be very strong. sorry, first quarter fiscally year, 2013, second quarter, those might be a little weaker. . >> do you agree with what ennis just said? >> in part. >> he said a slight miss and the stock could still go up. >> i agree because i think expectations are so low. if there's a big miss, it's a different issue. a big beat, it's a different issue. after that dies down, what we'll come back to is the product schedule. what are the new products? >> they're not going to talk about that today. >> absolutely right. they never talk about it now.
that's why i'm saying after that you will see the stock calm down and they will be back to the product story. >> doc, iphone, everybody is going to be watching for the numbers, whether it's 45, 46, 47, 48, 49, or 50 million. that's going to be the determinant factor for many people. but you better watch profits. if apple posts a profit decline, it will be fts irs time in a decade. there are a lot of whispers that might happen. >> while it could, scott, you're absolutely right, could happen, i don't think it will happen. i think that the bar has been lowered to the extent with all of the doomsdayers out there saying, well, they haven't been selling, it's not a hot phone jo anymore. it's still a hot phone. it's the best device i have ever had. this is so much faster than anything else i have used. >> it's the only thing you have used that doesn't have a string to a hand set. >> that's true. it's why it's such a superior device. >> the question is, is the high end smartphone market for apple
mature? >> no. >> it's not? >> no, it's not. nokia is already in china and i realize apple is unlikely to be there in the first, second, or third quarters of this year. however, i think apple is going to be there. they're going to be in more emerging markets. it's going to be through a financing deal rather than the subsidies we talk about all the time on the program. still, their margins are so much better. when you look at what it takes to get into best buy and how much subsidy samsung gets versus how much apple gets. how much do they give up per $100? samsung only gets about $65 per $100. apple gets about $94 or $92 per $1,0100 $1 $100. that's huge. >> they say apple is going to get the benefit of the doubt unless it's a tremendous miss. do you buy that? >> so sure i am right now. i think fundamentals have never been any different. i think even at $700, fundamentally you could make the
argument stock is cheap, they're sitting on all this cash. i think at $500, you are seeing a company that's technically has broken. that $550 level, that's where apple has to get back above. otherwise now it's technically broke. i'm looking at it right now. i like what they're doing. obviously what the verizon story tells us is the 4 and the 4s, those margins, if those are the devices they were selling the most of, the margins shouldn't be impacted that much. what are the margin levels now for apple, but i think you have to realize going forward as they get into the second half, if they come out with a cheaper iphone, that's going to be a great catalyst along with the rest of the refreshes they're going to be going with and as they get deeper into the asian markets. that's when i think the apple story becomes a lot more interesting. i think right now i don't know if you're going to get that major pop to the upside. >> that's the trader's point of view. what do investors want to hear from the company? let's ask one.
josh spencer runs the t. row price fund. he joins us live from baltimore. josh, welcome to the show. go to have you on "halftime." >> thanks for having me on. i'm happy to be here. >> i know you heard this conversation the traders were just having. what are you looking for? >> i'm going to give apple the benefit of the doubt as well like several of your guests mentioned. i think this is still a very innovative company. the iphone 5 was a big success last quarter, and i would not be surprised at all to see apple at the high end of expectations for iphone 5 and iphone sales in the december quarter. now, we're all sitting on pins and needles waiting for the march guidance, and we know samsung has started to catch up a little bit and nip at apple's heels but you also have to remember that apple stock is down from $700 to $500. it's a very compelling value. i think it's a growth stock trading at a value multiple here. >> the stock moved though over the last couple months would suggest that the street is not willing to give apple the
benefit of the doubt. >> no, which i think is the opportunity. you know, the street is very fickle in their taste, but with a company like apple, as we know from past experience, they don't show their cards early, and to say that they don't have an innovative pipeline might be underestimating the company. i think there are lots of signs that they're working on apple tv and we might see that come out later this year. i have heard a lot of talk and evidence from the asian supply chain about new phones that would launch in the middle part of this year, perhaps with larger screen sizes and new features. i have heard that apple may have things like fingerprint sensors and i think there's still a lot left in the tank. >> steve weiss? >> you know, the stock has come down, as you point out, but apple is not without blame here in terms of the decline in the stock. there aren't that many companies that miss three out of five quarters that hold an all-time high price. but one issue i'd like you to
address, as john pointed out, what apple gets in terms of subsidies is far above, almost 50% what a better selling phone gets from the phone companies. and verizon was very vocal and has been as is at&t about cutting back on that subsidy. with other companies picking up more share, doesn't apple have less of a stand to say we want to keep that subsidy? >> well, the carriers have also been vocal apple has better usage trends. so when you get an iphone in your hands, although the carriers had to pay a larger upfront subsidy, they also get a higher stream of monthly service contract fees on a go-forward basis, and i think as long as apple can bring out innovative products and drive customer taste, the carriers will have to go along with the subsidy model. there's been a lot of talk about samsung and samsung does have some great products in the market, but i think the numbers
will show that the iphone outsold samsung by about 3 to 1 at the high end of the smartphone market last quarter. >> if we want to look elsewhere within tech, what are your top plays beyond apple as we mention as your top holding? >> you know, i'm also very interested this year, and i'm excite excited about 2013 how it could play out about the enterprise tech company. we've talked about how companies and corporate america is sitting on healthy balance sheets. i think with some of the political debates behind us and signs that the economy is recovering, i was in asia last week and heard lots of signs about china's economy getting better. we could see the spigots turn on for some classic enterprise tech investment so companies like emc, network appliance, vmware
and disscisco. we saw fairly good results from microsoft. >> i'll say. the stock is reacting favorably today. that's for sure. >> and i think ibm laid out a playbook over the last five to ten years that a lot of other companies can follow. i have heard john chambers at cisco talk about dividend growth, margin expansion, improving software as a percentage of his mix. i think at cisco they look at what ibm did and think we can follow that path and so cisco is one of the top holdings in my fund because i think they're early in that same journey that ibm took. >> got it. josh, great to have you on the show. thanks for coming on. >> thank you. >> all right, josh spencer with t. rowe price from baltimore. ibm having its best day in several years. if you listen to the najarian brothers, back in november you could have cashed in on that move. here is what they said. >> i still like the name on a valuation basis.
they had a weaker quarter but i think they can perform. >> doc, are you going to go against your bro? >> no, i'm not. the oracle of omaha buying it around that exact level, 188, 190, i think it's a good buy there. >> all right. well, ibm is up 9% since that call. having its best day as we mentioned since march of 2009. the question is what do you do now? >> well, they were buying a lot of upside calls but it was all weekly. so it's a binary bet. it was really on the earnings. you know what they say buy rumors, sell news. i took off my long positions in this stock. it's not that i don't believe in ib m. i think they're really doing almost everything right and i think the stock could trade to move highs but i move on after the baby is born. >> it's what you were talking about before. we talked about with various stocks, mcdone 23458d's mike can i, certain levels are where you need to take it off. now that the earnings are out, it's time to get out of this stock i think and wait again for an opportunity near 190.
>> coming up,m donald's showing signs of life after a disappointing 2012. and is washington about to extend the rally on wall street another three months? we're live in d.c. where a key vote on extending the debt ceiling is just minutes away. and you asked for it on twitter and we're going to deliver with four plays on four stocks so you can make your trades. lots more "halftime report" is on the way. [ male announcer ] this is joe woods' first day of work. and his new boss told him two things -- cook what you love, and save your money. joe doesn't know it yet, but he'll work his way up from busser to waiter to chef before opening a restaurant specializing in fish and game from the great northwest. he'll start investing early, he'll find some good people to help guide him, and he'll set money aside from his first day of work to his last, which isn't rocket science. it's just common sense.
ripping higher. >> what a rip, scott. in fact, just last week we were talking with herb greenberg because citron research came out with a negative on the stock and it dropped by $12, then turned and burned to the upside $20 higher than that, and then today it's up $55. trading to $575. it's got john morgan puts an outperform on them. >>. research in motion is pulling back. ennis, what do you see here? stock down 3%? >> i think rim is setting up for a buy the rumor sell the news on this product release. the stock has gotten a bit ahead of itself. it's a great momentum name. i would be taking profits. >> i sold half my stock this morning. >> you did? >> i'll take issue with anything but on rim i sold half my stock this morning. i think it has upside to $20 level. everything i read about the
phone, it will be a great phone. >> fisbook is higher and within 17% of its $38 ipo price. pete, it's been a nice move. >> it has. if you buy into the idea of any kind of read through through google and some of the ad spend you're seeing and some of the mobile conversions you're seeing with google, i think you can read through some of that at least, a portion of that, to facebook. facebook has been on a run. it's had a little bit of a pullback, now it has more momentum. >> mcdonald's is higher after exceeding estimates on the top and bottom line. the stock up almost 6% this year after a louse inquire 2012. >> i don't think this is a stock that's going to break out a lot higher but it's paying 3.5% dividend. sales growth was better than expected. i think it stabilized the business trends that were hutting it last year. >> but you certainly don't sound enthusiastic. >> i think there are better
stocks to buy in this market. >> it's an interesting take and one that i heard my guy cramer make this morning as well. i think his quote was i don't want to buy the stock, plain and simple. >> i agree. i don't think it's particularly cheap. the growth is not there and nothing falls apart in one fell swoop but we've seen an atrophy of their sales. i'm staying away. they need to do more on the menu. they've come back with the dollar menu. >> doc, they expect january comps to be negative. >> and they have got the food cost issue we've all talked about repeatedly because those have been moving up. even to steven's point about the dollar menu, i think that's more of a challenge because the prices are moving up. >> you wouldn't buy the stock either? >> no, i'm not really. to ennis' point, i think at the dividend yield where it is, they can easily afford that given the money this company spills. if i owned it, i would hold it.
i'm not owning it and i don't see a catalyst to get in. >> pete, do you have a view different than the other guys? i'm surprised nobody at all on the panel is interested in mcdonald's? >> i think mcdonald's needs to do a little more work on the menu itself, but particularly -- >> you're not finding what you want? >> i'm not finding the stuff i want. when you go to wendy's, one of the things in that quarter that came out was their value meal. they've got to find themselves a little bit more room in that dollar menu to get themselves positioned better. >> coming up on "halftime" john paulson making big money calling the housing top. now he's making other big calls on gold and energy. we'll reveal them after the break. and coach dives on week earnings. we're debating today's worst performing stock on the s&p. "halftime" will be right back. "fast money" isn't just about a bull market. it could be going up, down, or
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welcome back to the halftime report. let's take a look at shares of google at the session highs today. it's having its best day in over a year. it's up over 6% after the company reported those much stronger than expected earnings and revenue for the fourth quarter. scott, back to you. >> thanks so much. so, pete, what do you do with o goog? to late to get in. >> there was a lot of noise. i see this pulling back easily towards 700 and giving people an opportunity. i wouldn't chase it here. >> doc? >> i think the big winner was pcy because he made $8 million on
the downloads of gangnam style. not everybody is going to do $8 million, i understand, but this is a revenue pass through much like the apple itunes store is and i think it creates a lot of opportunity. >> but the positive here is their mobile ads is actually looking pretty good. they're actually figuring it out. >> big question is, is that growth in the market or is it market share gains on their part and that we don't know. facebook obviously is responding to market -- to the market growing as is yahoo! at this point. but it will be interesting to see that. google always gives you another chance to buy it. >> hedge fund manager john paulson revealing some of his market plays during an appearance in new york city. kate kelly was there and joins us with some of his bullish bets. >> so paulson unveiled what amounts to essentially a four-part bullish thesis on u.s. recovery last night with the centerpiece being housing. prices are up, the number of homes for sale is relatively low and this sets the stage for a
rebound in building he thinks which make it is a great time to consider investing in residential real estate. he also talked about the u.s. energy turnaround which he thinks will benefit chemical and petrochemical companies. he thinks factors like low electricity prices will stimulate investment. other parts of his thesis involves credit which he thinks is slowly recovering and equities. how paulson is playing all this is only partly clear. he's a big owner of nexton, the global energy company soon to be taken over. he also owns axo nobel. but at least check his top holdings were prior primarily i financial, pharma and gold which he continues to be bullish on. >> i'd like to kick it around with the traders. weiss, i will go to you first. what do you think of the plays he has? the gold thing is nothing new. the guy has been a gold bug. >> none of it is new.
redengs real estate has had a major turnaround. i don't know anything he said that's new nor do i know why we should care. he had a great hit -- >> i hear you. >> with the housing cycle -- i always defer to billionaires. it's my first rule of thumb. i say i'm going to learn from a billionaire -- >> before we address the merits, do you have thoughts on where to be bullish in chemical or petrochemical. he's only got one big name. >> the feed stock costs have come down. other costs are going up. so if you're betting on a global recovery, that's where you're going to go. i'm not sure it's unrecognized in a lot of the stocks though. >> i would say the gold miners is actually an area he's underperformed in. in reality i still don't see the argument for owning gold miners over the commodity. as gold goes up, it's generally in an inflationary environment so costs are going up for the gold miners. they're mining lower quality
ores. >> e plays gold through the gld because he views it as a currency and he himself invests in gld shares rather than dollars. he also uses gold derivatives but there's -- >> i would much rather own the commodity. >> what about the housing play? financials primarily a position he has. they still run? >> absolutely. >> what about the builders? >> the builders are probably starting to slow down a little bit. i think the financials, particularly there are some names that haven't even run enough yet even though they are significant lay off the lows. back to the chemicals. i think it's a petro chemical area and there are so many names. lyb. there are all kinds of names in that space. some of them are 52-week highs but they're very, very cheap and the exposure into that area is huge. >> i thought what he said last night was a tell that he's buying some of these names although you can't quite see it yet. we'll see more pretty soon because the filing deadline is happening. >> and his pharma positions are
nothing new. he's not making a statement in terms of the company. >> my takeaway last night was kind of he's telling us stuff we pretty much knew. he's telling us thing about his portfolio we knew. he made 590% in 2010. >> phenomenal. >> he saw the crash coming before it happened, and now he's essentially called the bottom so that's interesting if nothing else. >> kate, thank you. gasoline is up again today, risen 5% in a week. is more pain at the pump around the corner? let's go to jackie deangelis, the host of "futures now." >> it's gasoline has has had the hottest run. anthony is at the nymex. >> it's a seasonal thing where gasoline is always higher at this time of the year. if you look at the charts it
starts to rally in january all the time. number one, you have maintenance of refineries that happens in a week or two. where they take refineries offline. product is drawn at that point. number two is there's anticipation of higher demand because we hit spring and summer driving season. number three, which is the biggest one, there's a transition from the winter gas to the summer gas and the summer gas is more expensive because that blend is more expensive. >> all right. jeff, anthony brings up the seasonality, but how much of this rally is being driven by oil? >> well, jackie, you're right. there's a technical aspect as well, but we are viewing this as a wonderful opportunity to get short here. you can get short here at this 285 level dao you to the fact we have seen a breakout. this oils is squeezed a lot of shorts. being squeezed in the short market, i think it's a false pretense. one thing i have learned down here from all my years trading the pits in chicago, you have to go with your intuition. 260 looks like the target.
>> so two different points of view but that's, of course, what makes markets. that's how our guys are making money. how about you? will gasoline be your best bet or are you better off in natural gas or oil? log on and make your voice heard. back to you. >> thanks so much. coming up, shares of coach plummeting on weak earnings and a cautious forecast, but should you buy the luxury retailer on the pullback? two traders, one big debate is straight ahead. and with shares of apple off almost 30% from its highs, should you bet on a beat or bust. a top analyst, toni, is coming up next. >> we're halfway through the trading day. next, citigroup, sales force, soda stream? what aren't we covering? google, gold, green mountain? we want to hear from you. tweet @scottwapner@cnbc and the
disappointing north american sales for the holiday season. the company told investors it had a more cautious outlook for the rest of the year. is it time to cut and run on this high-end retailer. jon is our bull, steve is our bear. they didn't give you much reason to be bullish so why are you? >> because the stock is getting down to levels i think are values again, scott. although i will point out that i have this three-day rule which is i don't buy the stock on the first day of the dip, and gary berman over at clearview trading, same sort of thing. i don't want to buy it today, but if we break through 50, get down to 49, i'm a buyer. i think also what the ceo said about china, 400 million is what he's looking in sales for out of china as well as men, he thinks the sales to men are going to go up about 50%. so it means steven is going to be buying a lot more over the next few weeks and months there because sandy that caused people to hit the pause button is now going to -- those same folks are going to go back in. >> weiss, what's the bear case? >> first of all, congrats doc
for having the courage to step so far out of his comfort zone to talk about fashion. but if you take a look at what's happening at coach, you have seen the brand again start to ap trophy. so it's no longer what it was. the space is a lot more competitive. you have marc jacobs, michael kors, and we have seen with china again and again where they follow the american patterns. so america's clearly voted. they say, hey, no mas because we haven't seen -- we've seen other bad quarters from coach over the last year or so. so you'll see a delayed reaction in terms of china where they back away and go somewhere else. so me fashion is by definition a fad. the fad is over. >> i think they come right back into china as far as how well they're doing with big numbers. the turnaround in china is good for coach and i think, steven, that's why you might be surprised going forward. >> we'll leave the last word there. ennis, who made the more compelling case on coach today? >> i say fool me once, shame on you. fool me twice, shame on me.
this is the second bad quarter for coach in the last six months. i'm going with mr. weiss. >> all right. let's get back to our top story today. apple earnings are out after the bell. it's a key report for the tech giant. should you bet on a beat? toni, welcome back. >> happy to join. >> aside from the criss-crossing of people behind me, we'll have a normal conversation, all right? >> okay. >> your expectations of what apple is going to deliver today. as i mentioned at the top of the program, heard somebody mention that it has to be an old-school beat, and you know what i'm talking about. >> it does. i think for the stock to work, it has to be a pretty convincing beat because in all likelihood the focus is going to be on the guidance, and apple typically guides pretty conservatively, and that's going to be well below consensus and accordingly, it's going to generate a lot of questions. really what apple needs to do is have a significant beat. >> can you tell me what the most
significant metric is going to be? is it iphone sales? is it margins? are we talking profits? >> i think the two metrics that investors are going toocus on are the number of iphones sold with buy side expectations i think being in the 46 million to 48 million unit range, and gross margins where the keep guided to 36% gross margins. consensus is around 38.5%. so those are the metrics that investors are going to be focused on. 52 million iphones or above would be considered a blowout, and that would be a very favorably viewed. i think 46 million or less would be considered disappointing, and then it's kind of your call on where it comes out in between that range. >> i have a trader here sitting on the desk today, toni, who says even a slight miss from apple could send the stock higher. any reason to believe that? >> i don't think so. >> with all due respect to the guy sitting next to me who actually said it?
>> i don't think so. again, i think the focus is going to be more on the guidance, and the guidance in all likelihood from apple is going to be conservative. it always is. so consensus is a little under $12 a share for eps for next quarter. it's possible that their guidance has a ten handle, maybe even a nine handle. historically they have guided as much as 30% below consensus. and so, you know, the guidance is going to be pretty low. if they don't have a strong quarter and the guidance is pretty low, i think the questions are going to persist about, look, is apple going through a bigger adjustment period than investors may already have factored in. >> it's ennis. i was the one who said the stock might go higher on a bit of a slight miss and the reason why is i think guidance going forward might be better. my only concern and i'm curious what your take on it is, iphone 5 production numbers, there's been a big concern in the market over the last couple weeks. what is your view about the potential reduction in
production and whether that has an affect? >> absolutely. there have been widespread reports that production for this coming quarter has been cut dramatically, and that's part of my rationale in thinking the number needs to be strong this quarter. implicitly investors would then say the launch quarter was huge, bugger than we expected, bigger than apple expected, and as a result they effectively pulled forward sales from the calendar first quarter into this quarter. i think that would be very encouraging for investors. if ultimately the number is just okay for this quarter, the guidance is low, investors are going to say, wow, there wasn't any pull in, the guidance was low. it really does feel like all these reports of iphone production being cut are valid, and i think concerns will continue. >> toni, are we at all underestimating the maturity of the high-end smartphone market? >> that's certainly a key secular question. you know, smartphones overall are not that penetrated. only about 42% of all hand sets
sold this year, 2012, were smartphones. and ultimately we think that less than 40% of all people globally who have some kind of phone have a smartphone. so overall smartphone penetration is still in the middle innings. the question is have all the wealthy people who are going to pay the equivalent of 600-plus dollars for a phone, which is effectively what apple sells for unsubsidized, already have a phone? i think it's difficult to say. it is a key question. we really don't know at what point we might see saturation in the high end. >> all right. well, we'll get some answers in a few hours. toni, i know you will be busy with that. we'll look forward to talking with you soon. >> my pleasure for joining. let's hit the biggest pops and drops. walter energy is popping 1%. weiss, what do you see there? >> i continue to like it. i think it's speaking to the global economic improvement, and they are just about 100%
leveraged to metco which goes into steel. iron ore prices going up. i prefer this over peabody. >> a look on general dynamics. >> the stock was down at almost 5%. on the conference call they gave reassurance and the stock is rally. the trend is defense spending tied to gofs expenses is going down. >> talk to me about cree. >> they blew out both revenue and bottom line numbers. you take a look at the suppliers. vecco is doing well and aixg, they feed into the l.e.d. space. >> satisfiway. . >> you look for the news and i couldn't find much. >> it's a pop for the 90s. it's not the end of the road for the biggest boy bands of that era. new kids on the block, 98
degrees, and boys to men have announced they will be touring together this summer. >> yes! >> more men than boys. now the members of the three bands now average about 40 years old. summertime tour is going to kick off in may and will bring back the boy band spirit to 30 cities across the u.s. of a. coming up, apple snl the only big report tonight. netflix earnings are on deck. with easternings soaring, shoul you buy ahead of the earnings. "fast money" means trading. er has got to bring their best information. the entire trading day is the preparation for the show that night. >> it's idea generation. it's all about giving you a framework for how to look at the market. as the world has changed, our show has evolved. i am guy adami, i am "fast
nothing. are you stealing our daughter's school supplies and taking them to work? no, i was just looking for my stapler and my... this thing. i save money by using fedex ground and buy my own supplies. that's a great idea. i'm going to go... we got clients in today. [ male announcer ] save on ground shipping at fedex office. a totally lip sync-free version of "power lunch." the house voting today to extend the debt ceiling. we're in washington with a congresswoman who will have just cast her vote. and you have heard by now that housing is recovering, but how do you make money in the
rebound? we have some stocks that have benefited from the home renovation boom. we'll tell you which ones they are and whether you should be in or out. speaking of being in or out, personal finance website learnvest shares its stories on a new version of "the power pitch" that's all today in a quarter half. now back to scott. >> it is the other big earnings report after the bell, netflix. the company has beaten the street the last eight quarters in a row and the stock has been on a tear. which means expectations are high. so let's take positions ahead of today's results. pete, what are we looking for here ? >> the four was all about the content, the buying of the content. now you need streaming subs to pay for it. >> and you have to have a number between a million and a half and two. if they can get in that range that's probably going to be good. the expectations are so high for netflix, be aware when you want to talk about an earnings with
volatility, this is an earnings with volatilitievolatilities. people expecting a monster move this quarter once again. >> the problem is, right, if you look at the very day they report earnings, they have beaten eight straight quarters. the stock is down six of those eight times. even a good earnings report does not mean that the stock is going to do much. >> right. it's always the other shoe. they push out profitability by a year. their content costs are higher than anticipated. i missed the stock, i haven't been shorted because it's so high and they've done a very good job executing. but at this level if i didn't like it in the 60s, i'm really hating it up here. frankly, just too volatile, too much angst about it. it takes your focus away from other things where i have higher confidence in. >> ennis? >> i kind of agree with weiss here. i think the problem is each quarter, even though the headline number looks good, it's the underlying business that it's slowly bleeding away in the
sense that content deals, they're inking them, but their subscriber number growth hasn't been there for the last two years. i think they need to show some stability or else it's going to be ugly again. >> can't wait to here from reed hastings exclusive tomorrow morning on cnbc. let's go to kate kelly at the breaking news desk with some information about one david einhorn. >> thanks so much, scott. so some disappointing news out of green lake capital. in an investor letter reviewed by my colleague that's just breaking right now. green lake capital was down 4.9% for the year 2012. that's for december. net of fees down 4.9%. for the year 2012 green light capital returned 7.9%. that's also according to the letter. einhorn says it was a disappointing fourth quarter. our coffee was too hot, our
apple was brew bruised, and our iron supplements didn't go down smoothly. this is not a confirmation. we're in touch with einhorn's company to try to get a clear answer, but it seems to be a potential tell that they're short that company, herbal life. einhorn participated in an earnings call, asked some tough questions during that call. that stock dropped dramatically. too date he's not said whether he's long or short. bill akman is dramatically short the stock. others like dan lobe as well as carl icahn are long and on the other side. >> i have herb greenberg zr screaming from the newsroom, we don't know. >> we don't know. >> when he drops something like that, you try to make an educated assumption based on his prior involvement with a phone call. >> absolutely. and although he doesn't really come back to this theme in the letter and the comment about the supplements didn't go down comes early in the letter, other
things he mentions in that sentence he touches on as he goes on. but, you know, he's very hard on himself here. he says the disappointing fourth quarter result reduced our year from good to pedestrian. while it's hard to year from good to pedestrian. it nonetheless falls short of our goals. he talks about shorts that lost money, that made money in their long book. >> he is nothing if not cagey. the way he drops the iron supplement. could be any number of publicly traded companies. >> absolutely. >> we know his history with green mountain. that's easy to figure out. we know the apple deal. that's easy to figure out. now the market will spend several hours before whether he short herbalife. >> back to you as soon as we have details. >> all right. coming up on halftime. you asked and we will answer. stock question on twitter.
we discuss apple to the bond market. certainly something not to miss with that gentleman right there. back in two minutes. how do traders using technical analysis streamline their process? at fidelity, we do it by merging two tools into one. combining your customized charts with leading-edge analysis tools from recognia so you can quickly spot key trends and possible entry and exit points. we like this idea so much that we've applied for a patent. i'm colin beck of fidelity investments. our integrated technical analysis is one more innovative reason serious investors are choosing fidelity. now get 200 free trades when you open an account.
scoop, first up is nxp semi. dong, what the trade? >> the trade is that on the 52-week highs, people are betting heavy and they've been wrong until recently. now with this surge, judge, and big turn around in china, 36% of their sales are in china, which is like four times bigger than sales they make here in the u.s. so this one is going to be breaking higher, i believe, over the next quarter. >> we had pipeline news the last 24 hours. someone tweeted me, i want to know what is going on with northern gas and nog. >> nog i think is primarily crude. heavily shorted. i'm not bear. if i'm playing in those areas of the country, on discovery. i'm going to play with hk. >> what would that be? >> hk. economical, two letters in the ticker instead of three. >> you might have mentioned that before. >> i did. >> when talking about nxpi, this
is based in china, based in shanghai. this name is very interesting. a product line that is part of this whole world in the social media area. very great, the balance sheet is strong. but i'll tell you what, very volatile stock, right now near the low end. >> i thought weiss was going to say, i'm not trading up. but there is this great book called "unhedge." >> it is a great book. >> what's the title? >> "unhedged." >> ebay. >> we did a trader battle with downtown josh brown on this last week out of the earnings report. i still don't really like it here because i would rather go visa or master card. in the end, the growth is coming from paypal. which is a great property. what you get for the same, purely a payment stock when you buy visa or master card. >> good stuff. final trades are up next on "halftime." ♪ you know my heart burns for you... ♪
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