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tv   The Exchange  CNBC  July 16, 2020 1:00pm-2:01pm EDT

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expense than it had ebitda last year that's why i own puts on the name >> wow betting against american airlines john >> sonos repeat buyers again, sully i bought it during the show. >> and brenda? >> booking holdings. uniquely positioned company with positions towards a return in leisure travel because we're all desperate for a vacation >> you can say that again. thank you very much. that does it for us on "the halftime report. i'll see you on "worldwide exchange." "the exchange" begins right now. i'm so with you on netflix, it's great for the 17th straight week, the number of people filing for jobless benefits topped 1
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million. over 50 million americans have lost their jobs since the start of the covid crisis. is the market starting to price in doubts about the recovery the snap back, how fast, how high and twitter's massive hack, was it a diverse from something else a top former cia official, sue gordon, says it is a real possibility and she'll join us live netflix on the clock airlines battle it out for the northeast and a big pizza beat we begin with today's markets and mr. pizzani. >> hello a fairly choppy day with a narrow trading range what's a narrow range? 15 points in the s&p dow helped by caterpillar and m 3m boeing is down hurt by technology stocks. that's been the story all week, a consistent theme the trend is tech and mega cap tend to underperform, the cyclical names tend to do
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better industrials, materials tend to do better and outperform they are down today but outperforming on a regtive llate basis. banks are holding up, tech is underperforming. big mega caps all down this week since apple. amazon about 6% for the week the other big names other than apple are down 2%, 3%, 4%, 5%. they use source of funds to buy other things including industrials. housing index was strong today toll brothers, hovnanian, horton, all on the upside. building materials and retail sales stronger than expected building materials up 17%, and retail sales is helping. new highs list for masco, lumber liquidators, generac, all doing well >> thank you very much. as growth power houses lose
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a bit of their steam and under the radar value names are they poised to outperform from here let's talk to dan genter of rnc genter capital, and byron leftowich is from city value stocks have been underperforming for quite awhile they can keep underperforming for quite awhile is now the time to nibble at them or what >> we think it is. when you look at it, the spread we're seeing now between value and growth is almost 29% i mean, it's exactly what it was coming out of the tech wreck in '99 and 2000 you never had a better situation the last ten years to where value is more attractive and we're starting to see it close the gap. it was actually in excess of 30% spread where the growth names are up about 14% right now
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value names are down about 15% but even in the last few days, that gap narrowed about 3%, 4% so you're clearly starting to see rotation as people realize this economy is going to recover but it will be slow and finding real growth is going to be a challenge. they want to be in some companies that are more stable and higher dividend. >> you refer back to the tech wreck of 2000-ish and said tats when a gap was as wide as it is today between growth on one hand and value on the other what happened then did value go on to outperform growth and let's not forget that some of those growth names weren't businesses at all. >> right absolutely what happened is it was a significant rotation for literally a decade, after underperforming for about five or six years, researching this type of a spread, then value outperformed literally for almost ten years so the value growth cycle tends to be about a ten-year rolling
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average. right now when you look at the s&p, even if you look at a 155 number for s&p earnings, s&p 500 is trading at about 22 times, but if you look at the value index, they're trading at about 15 1/2 times, some of the deeper value stocks are trading at 10, 11 the value is clearly there people are starting to see it and they're rotating to it >> tobias, take apart dan's argument he made there in favor of value i don't know whether you agree or don't agree implicit in it is a concern that the market is so concentrated into large cap growth names, the names we all know, whether it's microsoft, alphabet, apple, amazon, netflix, all of them, are you worried about the breadth of the market, the narrowship of the leadership and what do you think about the argument >> first, i agree with you on
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"fauda." >> isn't it good >> except last season. >> i didn't see it >> sorry to blow it for you. >> that's all right. >> we had massive out performance of growth in the tech bubble in 2000. we saw value retake the lead because of what happened to tech it continued until 2007 and 2008, then the financial crisis knocked out the biggest player in value, financials they always trade at low pes i don't think just looking at the pe is the right metric it's more price to book. generally i agree that value is probably a better place to be, our lead indicator models show that's the case for the next few months, but not necessarily the next month or two. i think the big catalyst historically has been when credit defaults surge and people
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think the worst news is behind you. that's kind of your big catalyst and with one other respect in there, the concentration of leadership so we love to point out to people that if you look at the second quarter trend, about 20% -- actually 25% of s&p 500 constituents beat the market by more than 10 percentage points we had 125 names that did really well it wasn't just four or five names. when everybody talks about the narrowness of the market i think they're missing some other critical criteria. there's the big cap news everybody likes to talk about. and the question is is there too much crowding in there i would agree, not just from u.s. investors but even international investors. >> dan, are there particular sectors or types it of stocks you tilt to now? >> we do like the financials i think you're in a situation, you're seeing the reporting coming out from jpmorgan, morgan
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stanley, b of a, the fact of the matter is deposits were up 21%, they got squeezed on net interest margins, but growth is extremely strong trading at 10% discount to book value. and a 9 pe you get 3% dividend while you wait that's a strong sector frankly i think some of the sin stocks, when you look at altria, you will get almost 8% in dividend yield while you wait with tremendous pricing power. they'll play in the beer and wine sector. they will play in the cannabis sector these are all companies that are going to survive, they're going to do well frankly we like the fact that if you can get fo4%, 5%, 6%, 8% in dividends, you'll get paid for that long period of time >> we appreciate your time
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today. great to see you thanks a lot attorney general william barr ramping up the rhetoric against not only hollywood but big tech in how they deal with china. kayla tausche has the latest >> the administration is not going forward with sanctions on chinese officials for now, but the trump administration is making it clear the gloves are off at least rhetorically in its views of the chinese communist party. in a speech today in michigan, william barr launched a blistering broadside against china and the u.s. corporations that work there. barr acknowledged disney saying they subjected themselves and their brand to copyrights, and there was another park that was a copycat of disney shanghai that opened up down the street it didn't stop there he had a hole howhole host of ce
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that say they're bending their bylaws to get china's business >> hollywood is far from alone in kowtowing to the prc. america's big tech companies have also allowed themselves to become pawns of chinese influence. corporations such as google, microsoft, apple have shown themselves all too willing to collaborate with the ccp >> apple and other companies have long defended their operations in china and their practices there and the security of data that is stored there it's no secret the white house wants to craft a policy to incentivize many of these companies to close those operations and onshore them back in the u.s it is also clear the white house a couple months before the election does not want to see the hawkish high ground to former vice president joe biden. >> isn't it the fact these
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companies are there for reasons of production in some cases but also because this is an exordinary lucrative market to sell into? >> yes, they want access to the chinese consumer, the burgeoning middle class, but one of barr's arguments is as american companies, these are brands that are looked to, they are to uphold a certain set of values, and at least in barr's words, they are not >> all right coming up, more on twitter's massive hack, was it a dry run for something else or maybe a diversion? a top former cia official, sue gordon, will weigh in with her official on what happened. and netflix on deck with earnings can the streaming giant keep up its covid momentum the stock is up more than 60% so far this year. there you see it at $526 a share. we'll tell you what you need to know ahead of the report
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switch and save hundreds. xfinity mobile. twitter shares under pressure now following a massive and unprecedented hack targeting accounts of some of the most high-profile users including lu elon musk and former president
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obama. let's get to aieamon javers >> twitter put out a statement last night explaining some details about what happened here twitter saying this was a coordinated social engineering attack and it successfully targeted some of our employees with access to internal systems. they say they're looking at what other malicious activity these attackers may have conducted or information they may have accessed twitter trying to get to the bottom of this they're saying it was a massive social engineering attack which means in some way the cyberattackers here manipulated people inside twitter. they tricked them in some way with an email, a slack message that gave them the sense that they were communicating with somebody they could trust, somebody in their close circle of friends and colleagues. that seems to be what happened here but there's a lot we don't know some folks i talked to over the past 24 hours here are worried that what we saw yesterday as
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disruptive as it was on twitter, it could just be a prelude to what we might see going into the election season given there's a number of states and hackers who saw the russian playbook in 2016, that playbook is now in the hands of more players. the question is whether we'll see a lot more of this going into the election. >> the phrase social engineering sounds curious to me is it just a fancy way of saying these hackers turned or bribed someone on the inside? >> yeah, that's what it is usually when they say social engineering in cyberspeak is a trick. you get an email appearing to be from your boss, your colleague, you think this is a real email, it's dressed up to look like it, and it may refer to previous communications you had with that person, so it feels real and you respond to it. you may give up the routing
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number for a check or respond with the address of someone. they can get information by tricking you and pretending to be somebody close to you that's the term that's broad enough that maybe it could include the idea of bribing an insider and security experts always talk about the ultimate threat is the insider threat >> thank you very much, eamon. eamon javers in washington let's bring in one of the country's foremost experts on cybersecurity, sue gordon, former deputy director of national intelligence. as we look at this attack, little harm done apparently. the worry is, i would suppose, that this could either have been some sort of diversion or some kind of probing of the defenses of a major online player, namely twitter. >> i think on its surface it's just cyber being an opportu
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opportunelistopportune itse opportunistic predator i think you have hit on the two concerns number one is this time it was just money, but imagine it it on election day if your local election authority tells you to go to the wrong place. the second is this was clearly administratio administrative access. somebody got into twitter and was able to do something massive. that's something we need these companies and entities that are holding private information to get with the program of the responsibility that they have. both protecting technically but also really investing in what we talk about, the humans that are involved almost all cyberaing ta cyberata
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human to enable them so these companies have to pick up on their responsibilities >> they have to pick up on their inside processes, their people here the literal payoff presumably was money this is what was being gone after here, bad as it is is nothing compared with what could happen if these malfactors got access to the elek troectoral ss or a banking system. the elections are the main thing i would worry about. >> there are some clear but difficult things to do one, there needs to be a standard by which you're protecting your information. two, people who have administrative access because we know there's a pathway in, that's true whether it's an election system or whether it's twitter, those people who have access to administrative level controls they need to be really
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educated really invested in and have limited authority without oversight to do things whether it was purposeful or whether they were just duped, their compromise has massive systemic effects like you say, if we're talking about u.s. policy or elections or international finance, those are much bigger consequences than a few hundred thousand bitcoin. >> sue, the elections in the united states are administered by the states and by counties. >> yes what is your level of confidence that they're up to the task of protecting operations? i think we are much better positioned than we were in 2018 and much better positioned than in 2016. ultimately it comes down to whether the protections we know are necessary have been put in place. and have the people who are running it been made aware of
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the threats that are to them these cyberattackers getting more sophisticated one thing about the messages that came from the elon musks and the tim cooks. the messages were different from each other so they're getting smarter about how to influence humans to do their bidding. >> it's fascinating. what's the thing that worries you most in the world of cybersecurity now? i think that we are not seriously considering coordinated protections and standards for thoseentities that holdimportant information or conduct important acts. i was thinking the other day that in the 1930s we saw the investment in accounting principles and practices because we knew what companies were
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doing had to be done to a standard i wonder if this is the time we look at some cyberpractices that are common to companies that are holding our security in their hands with their actions >> fascinating sue gordon, thank you as always. >> you bet >> have a good rest of the week and summer coming up, will we get another covid relief package the chamber of commerce is pushing congress to get one down the chamber's executive vice president will join us with what he says needs to be in the next legislation. and a new partnership between two major airlines, the details and what it means for the competition and customers like you. you can always watch us or listen to us live on the go on he ecnbc app "txchange" is back in two minutes. the volatility. the ambiguity. this moment calls for more. and northern trust delivers more. with specialized expertise. proven strategies rooted in data and analytics...
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♪ ♪ now is the time to support the places you love. spend 10 dollars or more at a participating small business and get 5 dollars back, up to 10 times with american express. enroll now at welcome back let's look at markets right now, here are some of the movers this
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hour shares of sleep number going down today despite beating on the top and bottom lines in-store sales down 40%. online and phone sales up 200% sleep number now down 10% at 48.29. tesla down today after vehicle registrations in california fell model 3 registrations fell nearly 64% those shares at $1,522, down $22 a share. shares of space are out of this world. virgin galactic appointing a new ceo and board member he was most recently of disney parks international. and virgin galactic trading higher that's the only one up of the trio of stocks, that's up to
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21.44. let's get to sue herera for a cnbc update. here's what's happening. to ease the burden on working parents, new york city will sponsor child care for 100,000 kids who will be unable to attend school full time in the fall the city plans to offer a mix of in-person and distance learning. nbc news reporting dr. anthony fauci and president trump spoke for the first time in weeks yesterday the conversation comes amid increasing tensions between white house leadership and task force members. and these pictures are the closest ever taken of the sun. they were captured by the solar orbiter, an international collaboration between the european space agency and nasa. letter this month, "jeopardy" will begin airing material from its archives for the first time ever. alex trebek has been battling stage 4 pancreatic cancer but he says his treatment is paying
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off. we wish him continued success. that's the news update back to you. >> thank you very much as cases of the coronavirus spike in the united states, we could be facing more economic pain and the chamber of commerce is calling for congressional action it sent a letter addressed to president trump and congressional leaders asking a phase four relief package target small businesses, assistance for child care centers, elementary schools and extended unemployment benefits. joining me now is neil bradley from the u.s. chamber of commerce welcome. good to have you with us >> thanks for having me. >> you are calling for extra stimulus to keep the economy moving forward for some time now. as you see it, how do you handicap the hods of th sodds ot happening and what are the obstacles to it? >> we're optimistic. it's going to get done because it has to get done if we're going to beat this virus, help our economy recover,
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he need timely targeted temporary assistance from washington one of the things that we've had the benefit of doing over the last several months is talking to businesses of all sizes across all industries throughout the country and learning what's needed that's what we transmitted to the president and congress today. i think they will get it done and i think we'll have to bridge the partisan differences that we simply can't afford to become an impediment to progress in this area >> on the one hand, the democratic side has put forth a mac cage of more than $3 trillion the gop side, something north of $1 trillion. one of the main sticking points as i understand t beyond the scale of the two proposals is a provision in it that would provide some sort of liability protection to businesses i know you are on the side of favoring that. i think the democrats are on the side of limiting that protect n
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protection explain your case for it >> absolutely. it's not just businesses, we've been joined by non-profits, universities, colleges, all who agree that if a school or a non-profit or a business takes the appropriate steps, informed by public health officials to try to prevent the spread of the virus, they shouldn't be trdrage by a trial lawyerinto court a year from now alleging they should have done more. we're not asking for immunity for anyone we believe a common sense safe harbor you follow the advice of the medical experts in your business or your school and then you shouldn't have to be worried about a court second guessing that layer one reason we're optimistic about this is because there's growing bipartisan support for it earlier this week a group of democrats and republicans sent a letter to the leadership
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endorsing this type of approach. it's passed before, whether that was the lead-up to y2k or 9/11 you have an interesting take on the -- one of the sticking points which is to extend the enhanced unemployment benefits which had been $600 a month, i think. >> a week. >> 600 a week, excuse me which is a lot of money. many said it is a disincentive go back to work. what's your solution to that one quickly? >> we have to bridge the gap under the current policy, the average unemployed person makes 134% of what they made working if we got rid of it entirely, they would make 45% of what they earned working we think coming into the sweet spot is 90% of what they earned working. it will make sure they can pay the bills but also that we get them back into the work force and back helping our economy >> i want your take, i don't
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know whether you heard some of the remarks that attorney general barr said giving a speech he went after several by name large american businesses that do a lot of business in china, assailing them for being in the pocket, i would say, of the chinese communist party, particularly on matters of intellectual property theft. i think we may have lost neil's signal there boy, was that a good question or what maybe i'll answer it i don't know i won't answer it. neil bradley, we thank you you're profrozen in place over there. the pizza trade is still hot. can peloton keep pedalling an online book store celebrates 25 years online. i'll ask the questions when "the exchange" returns. california phones offers free specialized phones... like cordless phones,
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all right. welcome back to "the exchange. let's catch up on a few stories that should be on your radar let's get started with rapid fire kate, let's start with dominos pizza delivering strong second quarter results. a 16% surge in same-store sales. more americans ordering p it's pizza and takeout during the coronavirus. i guess we shouldn't be terribly surprised people are not eating out in restaurants so they're dialing up and delivering. >> that's right. one interesting thing mentioned on the call is that even as dining rooms are starting to
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open in cities and states around the country they have not seen a drop off in business they noted that people are ordering more, spending more money. seemingly potentially for leftovers. 16% comp in the u.s. that's remarkable just given the staggering numbers and drops in business that we're seeing from other players in this space. we talked about this earlier in the week domino's also papa john's, chipotle, wing stop, those have been the four out-performers in the restaurant sector during this time because people are relying on carry-out and delivery once again domino domino's doess all on its own they said again they are to the planning on teaming up with anybody, that they will do it on their own. >> we had a spirited conversation yesterday about the spirited seltzers, flavor eed seltzers what do you do when you order, a
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pizza store or a local place >> if you want to order something, you need it in 20 minutes. if you're looking for quality, maybe the neighborhood spot. >> and it depends on where you live, if you have access as many of us do in new york and new jersey to the world's best pizza. >> where i grew up in kansas you were limited to the domino's and the pizza huts and the papa john's of the world, now that i'm in new york city i opt for something local. >> we will do a rap piid fire wr we have a pizza taste test >> do i get to weigh in here >> yeah. >> as the reports report, huge pizza lover, i eat all kinds of pizza. i don't discriminate i have to try everything i love it. that's my answer >> let's go from eating pizza to peloton. it's sort of the opposite ends of the spectrum here
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another stay-at-home name, ubs lowering its rating on peloton to neutral saying the run up on the stock pushed its valuation too high and that it sees limited upside from current levels peloton shares soared more than 100% this year as gyms remain closed due to coronavirus restrictions peloton, what do you think >> i do have one i've been using it a lot >> yep >> but i had it before the crisis i think one of the key issues for peloton during this stay-at-home trade situation is the delivery backlog i heard now that i'm part of a mom, i'm part of these mom facebook groups, moms constantly saying does anyone have a used peloton i can buy? if you order one now it can take weeks or months to get them. you know, that's something that, you know, once gyms do start opening back up, it will be interesting to see if peloton
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can still benefit from that trend, especially since they're potentially losing orders for people who don't want to wait six weeks for the bike >> the gym business will be a tricky one i think it will take a while for people to feel comfortable going back to the gym. i have a pelotopeloton, the thig that's curious to me, i used it more than i thought i would, the thing that's been curious to me, there's no barrier to entry here you can invent a bike like the peloton or largely like the peloton and do what it does and probably undercut the price. >> soul cycle did, they came out with a competitor stay-at-home bicycle that you can buy that is a similar price point. the barrier to entry is low. if you look at the stock, the pandemic saved peloton it ipo'd at 29 a share, went to
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18 at the height of the pandemic now is at 62. a lot of people think -- i know this is a valuation call, but a lot of people think this workout at home concept is here to stay. >> i hope, kate, some of those instructors there like robin and -- >> i love robin. >> and there's a good one there, alli, i hope they got stock in that company. >> yeah, me too. i think moving forward this is going to be a huge play just because the gym will be changed forever. even when it's safe how comfortable will people feel going back whether it's a peloton or something that's cheaper, who knows, maybe they could come out with lower-priced equipment. i think more and more people will be willing to invest if they have the space and money at home >> i do the yoga on my computer with a guy named dennis morton really good. leslie is smiling.
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>> yep i have done his classes, too >> we'll let that one sit. >> next, new data shows after 12 straight weeks of rising occupancy hotels located in coronavirus hot spots now starting to see a decline in stays. seema, you've been following this story i guess there was a comeback and now a fall off >> yeah. starting to see a drop in hotel occupancy in states like texas and florida where covid cases are on the rise. but here's what's really interesting, if you look at the states that are seeing the strongest hotel occupancy trends, get ready for t idaho, montana, south dakota. these are not states that are popular tourist destinations over the summer, but it just speaks to how travelers preferences are changing post the pandemic this need for outdoor space, access to national parks that's driving more tourism into the states >> montana has had a low rate of covid throughout maybe my favorite state in the
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country, so georgeout out there. i went to idaho last year. they have had a bounce back in some cases in boise, as i recall, seema. >> you're right. so that's a trend to watch the correlation between the rise in covid cases and how long it has an impact on americans and their travel plans, if you will. for florida, it took about two weeks to start to see a dip in occupancy once cases started to rise >> looks like the airbnb ipo may be back on track >> yeah. it looks like airbnb is prepping its ipo. what's interesting from a travel perspective, the big trend this summer has been the rise of vacation rentals demand is p. prices are up, especially in go-to domestic markets like the hamptons and burerkshire hathaes >> airbnb in the hamptons, you
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better be rich is what i would say there. any insights on the ipo? >> it's one of those ipos in talking with sources over the last few years that's been kind of like on again, off again. palantir is another one of those that's on again and off again. it appears to be on right now until it's not airbnb i would put in that category it's a possibility for 2020. it's not a definite for 2020 but there's certainly an incentive to get out in 2020 because there are restricted stock options for employees that do expire at the end of the year if they don't get out in 2020, they might have a disappointed work force which is not good for the company. >> kate a milestone for amazon today, marking the 25th anniversary of the real debut of going online at not the anniversary of the i date when the site launched in 1995, it was a virtual book store with
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about 10 employees based in washington state of course now it is a global powerhouse, sells everything it streams sports, movies, more. has production, giant cloud company. last year revenue about 3$300 billion. if you invested $10,000 when amazon went public, 20 years after it went online you would have now about $20 million. kate, it's hard to imagine a time when there wasn't amazon. so often do we use it today. here's a guy who worked in a hedge fund, a quant hedge fund, d.e. shaw in new york, he left to pursue this dream i would not have thought that amazon would have -- i remember when it was just a book seller and sold cds remember those, cds? now it owns retail in a way that i don't -- i can't imagine jeff bezos dreamed of >> it's just incredibly
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remarkable to think about how this business has grown. just looking through the years as we are pulling up here. the whole foods acquisition was a big deal that was in 2017. like the size and scope of the business, how it's continued to grow and evolve when it comes to retail and how we increasingly rely on it now i can't imagine what life was like before this i feel like i can't remember >> there's a whole generation of folks, you're not far removed from it, if i may say so, who don't remember when there wasn't an amazon. but let me just ask the panel one more time, how many times a month on average do you use amazon, get something? seema? >> oh, at least -- at least twice a week so that's -- >> whoa. >> eight times a week. >> wow >> a lot >> leslie? >> as a new mom i used it more than ever. there are diapers wipes coming to our apartment on a weekly basis at this point from amazon.
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not to mention all the other stuff we order i would say biweekly >> kate? >> same for us i'm willing to pay more if i have to so i don't have to run out to target and walmart, just for the convenience of having it delivered. i try to conserve and order things altogether, but it's tough to do, more than ever we're getting more and more packages every week in our apartment. >> i'm with you. it's probably twice a week or mo yesterday it was football cleats for my son he was happy, they fit this time appreciate it. seema, leslie and kate rogers. jetblue and american airlines struck a deal to take on delta and united in the northeast. why this key u.s. market brought these competitors together that's next. tonight at 7:00 p.m., cnbc in partnership with acorns will host a special virtual live town hall we bring together americans affected by the economic downturn and financial experts
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who will answer their most urgent questions and offer strategies to reset and rebuild their financial futures. that is tonight, right here, 00.m7: p. eastern time on cnbc
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american airlines and jetblue teaming up to take on united and delta for dominance in a very important u.s. market. phil lebeau with the details hi, phil >> we're talking about the northeast. new york city, the tri-state area, boston, really the hottest corridor in terms of traffic here in the united states. when you look at shares of american and jetblue, the reason we're showing you both is because they have agreed to a code share agreement as part of that code share agreement it allows them to share passengers american can book a passenger, put it on a jetblue fight and vice versa here's the reason these two
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airlines made this deal. it allows american to have more options in new york city and in boston i thinks th there's 100 routes f jetblue they can put passengers on jetblue will have more access at laguardia and newark and when that foreign market improves, transatlantic flights that are part of the american system. this is really all about the new york city at the end of the day. look at the market share and where american and jetblue are relative to their competitors. delta and united dominate that market, laguardia, newark and jfk. so american and jetblue are looking to get stronger. when you look at the airline stocks, remember, all these airlines will get smaller come october 1st. they have to they don't have the revenue and they're doing the cash burn at way too high of a rate so when they get smaller they'll have to do more with less. in terms of being smaller, a big reason why is the passenger levels the latest numbers from yesterday, down 78%.
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so we're not seeing the snap back in demand >> thank you very much phil lebeau in chicago for us. coming up, "tiger king," "the circle" and "unsolved mysteries" are a few things on netflix that people binged during lows. can the positive momentum continue we'll talk about that one next usaa is made for what's next no matter what challenges life throws at you, we're always here to help with fast response and great service and it doesn't stop there we're also here to help look ahead that's why we're helping members catch up by spreading any missed usaa insurance payments over the next twelve months so you can keep more cash in your pockets for when it matters most and that's just one of the many ways we're here to help the military community find out more at
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st stock which is one of those stay at home names has been on tear up nearly 60% in 2020
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content wise been a very good year despite losing a bing favorites like friends and the office, netflix quarantine is full of hits there's tiger king, love the blind, space force and many. can netflix keep the strong performance going? let's bring in sarah fisher. what do you think? this company keeps defying sort of gravity and the odds, number two. is there a point where they dump up against the addressable market in the united states. i can imagine there's a huge unaddressed market internationally. >> that's right. we thought they hit that ceiling a few quarters ago when netflix began to plateau in the united states the pandemic has been a boon for netflix here do momestically as people are locked at home. the big question we thought could netflix continue to capitalize on that growth despite income in competition from the likes of disney plus, hbo max and peacock which just
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launched yesterday to non-comcast streamers. investors think netflix will beat estimates for subscriber growth and earnings. i'm looking for whether or not it can sustain that momentum next quarter as the lockdowns continue to ease >> let's talk about some of the competition that's come. you just mentioned peacock which is the comcast nbc universal offering that's debuting this week are those and disney plus, hbo max, others, are they eating away at netflix in any discernible way? >> you know we didn't see it come from the past two streamers. i doubt we'll see it from peaco peacock. peacock is billing itself as a free streaming platform. you click pay for a tier with advertising but that's not what nbc wants. they want to sell people ads through the free version i don't see them picking at netflix dominance here as far as disney plus and hbo
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max, sure. they might eat at netflix opportunity domestically, maybe a little we have seen over those past two launches that netflix continues to have strong momentum even afterwards i think the biggest challenge is what will happen internationally. we know third party vendors have done great in india. i'm curious to see what that growth has looked like after we see earnings today at the end of the bell >> say it does well on earnings and subscriber growth makes numbers or exceeds the numbers is a beat built into the stock price right now? >> i mean a will the of netflix investors would say, yes analysts would say yes you even mentioned it the stock is well up over 50% since the lows in march. the other thing to remember here is that how high can netflix really go. at this point, as i mentioned, i think they are mostl
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domestically i think a lot of that price beat is built in. we'll still expect to see a bump one of the things that's been a terrific boon for netflix has been their success and investment in multibillions of dollars in fresh and original programming. that programming production has to have ground to halt this year, right? >> it has. in a sense it's a good thing for netflix. last quarter was the first cash flow positive quarter ever because they weren't dumping billions of dollars into production and adding subscribers. to your point, it's hard to increase original programming when you have production halted. netflix has still been able to put out hits as you showed at the top of the show, space force out of banks, these shows have done well unsolved mysteries reboot for netflix. i will continue do see momentuming from netflix in terms of programming despite the fact, they are losing some new things to nbc and others like
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"the office" and "friends. >> not a production of netflix but one that airs there. they really do have some fantastic shows. one of the attractions is you do not have to watch ads. that's an advantage. sarah, thank you very much for your time. we appreciate it >> thank you so much thanks for inviting us into your kitchen coming up next hour, a downgrades pushing shares of disney lore today. the analyst behind the call will join us to discuss that. i'll join melissa lee on "power lunch" after this quick break.
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welcome back, everybody. glad you could join us for "power lunch." stocks are under pressure right now. with the nasdaq leading the declines, down about a percent as more americans file for jobless claims than expected that has weighed just bit on investor sentiment this day. retail sales coming in above kp expectations but a top analyst says there's more ahead. later, a massive twitter hack still a lot of unanswered questions about what happened and could there be a bigger cyber attack campaign ahead? "power lunch" starts right now. >> welcome, again. thank you, tyler morgan stanley jumping on strong trading revenue helping to lead the financial sector


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