Skip to main content

tv   Power Lunch  CNBC  July 18, 2022 2:00pm-3:00pm EDT

2:00 pm
this thursday and we'll look at one name that looks technically sound ahead of results and one that's a bit shaky that's on "power lunch" which begins right now ♪ ♪ ♪ good afternoon, everybody. welcome to "power lunch. i'm tyler matheson we're flying high right now with boeing shares up 10% in a week and delta placing a big order and i do mean big. bank of america hiking its price target on that company if sentiment is turning is boeing now a buy plus, bitcoin miners and power down in texas as the intense heat tests the grid there. the ceo of riot block chain here to discuss the impact on the mining community and whether today's rise in bitcoin prices will continue. kelly? >> tyler, thanks look at this, we're erasing a 356-point gain on the dow and
2:01 pm
we're negative by 30 the s&p is down five points and the nasdaq was the outperformer with the 1.5% gain earlier on and we were losing steam already and then we got this report from apple. look at the shares they turned lower and pushed the market into the red. this reports that the company plans to slow hiring and spending in some divisions next year no official comment from apple yet and the shares are down 1.6% and they're positive and it's 147 and opened around 150. goldman sachs for what it's worth also says it plans to slow the velocity of hiring and that stock positive today off the highs. and it's up 1.57% after the bette better than expected earnings and revenue will it be enough to beat back the bear and power stocks higher? mike santoli is down at the nyse mike >> yeah, kelly the bear got a lot down in six months down 25% in the s&p into mid-june we haven't made a new low in the
2:02 pm
market in about a month. that also happened back in april. so it does not mean the downtrend is notable and if you squint at the market action you can spot the potential for four peaks, right you have peak inflation getting priced in on some level and relatedly peak bond yields perhaps and that's to be determined and peak oil prices, maybe and all of them need to be proven and the market balance itself has aren't sn't stretche levels than a relief bounce and is better than fear earnings going to be big enough clearly, working for the bank xs th and it seems they surprise pleasantly for the upside and for the rest of the market that's up better, we'll have to wait and see apple has held up extremely well, relatively and you see what happens on the headline for that stock >> just as everybody was warming
2:03 pm
up to it, mike, do you glean anything bigger and not necessarily from whether this report is true, but from the stock reaction in apple shares in the market more broadly >> yeah. i think mostly it's about the perceived safety of apple as just an entity and as an investment and it was up, 14% in a month or something like that so the fact that it was on a roll and people are buying it because of a no surprises type thing and everyone is doing it and it's not a big deal if it's, in fact, true and it shows you the sensitivity on the tape that is starting to wobble, as you mentioned. >> thank you for now mike santoli. there is a lot going this week and it's one of the most complex earnings seasons maybe ever, from the inflation issues and foreign exchange issues and the concerns about the possibility of a recession and rising interest rates. who knows? and the heat, this week we have netflix, johnson & johnson, tesla, american express just a
2:04 pm
few of the big names that report you can see them there all on the wall our next guest has a guide for investors on how to cope with it and it's peter anderson of anderson capital management. peter, you say this is a time for intelligent fortitude. what does that mean and what is the opposite of that >> well, good afternoon, everybody. so i have created over time, tyler, just a set of guidelines for what i think investors really need going into an earnings season like this. we all go in with our minds on fire and sometimes it's better to just have a set of guidelines and the first question i ask is should you even be here, meaning, do you have the stomach to suffer through this earnings period i think this earnings period can be tremendously changeable you'll have every kind of interpretation of what people are seeing for the next six months
2:05 pm
so if you don't have a long-term horizon, you shouldn't be listening to earnings reports and long term meaning over a year and then the second thing is with these companies, pay attention to what they actually do rather than what they say so as an example, if a company says we're going to tighten our belts over the next six months you can interpret that in many ways and if the company says we are ceasing our stock buybacks, then that's much more tangible and that can give you a lot more insight into what these companies are actually thinking. i also say, don't hang on every word, tyler. these companies, although they think they know more than we do, in this case i'm not sure they do simply because we're emerging from the most tumultuous period of a recovery. so those are some of the things i think will help us with intelligent investing, and i'm sure you know what the opposite
2:06 pm
of that could be >> yeah. we're emerging from a recovery i'm not -- maybe i don't understand >> recovery from covid i don't necessarily mean a market recovery. i mean -- >> oh! >> we tend to forget we get all worked up about how quickly this recovery is happening and whether or not it's happening we saw last week will the fed raise? for 24 hours we were thinking the fed would raise 100 basis points and now we're back to 57 and these things are changing so rapidly and investors are trying to hinge on every word >> take a chill pill here, right, is really what you're saying. >> yes >> if these earnings are making you nervous you probably shouldn't be in this market in the first place if you're that upset and in turmoil over it so you have a couple of stocks i know you want to mention by way of a bar belly approach that can
2:07 pm
soothe your nerves >> yes i think for those of us that want to stay invested and are optimists and to be a successful investor you have to have two things and you have to be a risk taker and an optimist and those two skills are really, really in demand right now so say you want top stay invested, one of the ways and you're still kind of nervous about where the market is going to go and one of the ways to do this is to take a high beta stock and pair it with a low beta stock and i just mean how responsive these companies are with the change in the s&p so if the s&p sneezes and one of these stocks gets pneumonia, or i guess i should commonly say covid and that is a high-beta stock and you compare these two and as an example i gave caesar's and it's a very high beta stock, if any of you are
2:08 pm
watching that, and i own that stock and it's been stomach churning and it's three and a half times more volatile than the s&p 500 and then equinix is one-third as volatile as the s&p 500 and you pair those together you might be able to sleep a little bit better at night >> any other suggestions, peter, for people that are nervous about which way we're going in the next time? >> yes my thesis has always been that we tend to look at this really closely, and i am guilty of that, too, because this is my business, but i do think that six months from now we will look back at this and i'm hoping that the fed is not going to be aggressive because there's a six-month delay in any of the action the fed takes and i'm worried that the fed might tighten too much and that inflation will just take care of itself in the normal course of business, kelly. you know, looking at plywood and lumber prices, we were all
2:09 pm
really upset during covid because the prices had spiked so much and when you check the prices they're back to pre-covid levels without fed intervention or any kind of economic intervention so i do think that left to its own with a little bit of fed tendering to this -- tending to this, then i think we will probably be a lot better in six months and we won't be as nervous looking into earnings and hanging on every word. >> you just painted the optimism side of it peter andersen of andersen capital, thank you. >> you're welcome. coming up, tex as bitcoin, with the stock rallying today and it's up 14% in the session netflix shares are down 67%.
2:10 pm
if the stocks plummet further, could they be acquisition targets for big tech >> as we head to break, two stocks hitting off-time highs and it's centene and r block we're back in two. ♪♪ take the world by cloud. accenture let there be change.
2:11 pm
as a business owner, your bottom line is always top of mind. so start saving by switching to the mobile service designed for small business: comcast business mobile. flexible data plans mean you can get unlimited data or pay by the gig. all on the most reliable 5g network with no line activation fees or term contracts...
2:12 pm
saving you up to $500 a year. and it's only available to comcast business internet customers. so boost your bottom line by switching today. comcast business. powering possibilities. bitcoin bouncing back up 5% above 22,000 and 19,000 and thereabouts and still down more
2:13 pm
than 50% so far this year even though it's crypto winter, part of the bitcoin world is feeling the heat kristina partsinevelos here to explain what she means by that >> got to love a good pun. >> crypto miners flocked to texas to take advantage of electricity and mining hubs and they buy computing power in the world, but mining is incredibly energy intensive that's why texas's state-run power grid asked to shut down before it peaks. >> we need to understand that this is risking the ability of y utilities to provide service and it could be deadly. >> when you're seeing a sea of green here a three-month chart tells a com plately different story. take a look at hyde down the
2:14 pm
98%. marathon, 52%. riot, 52% and it brings to light the issue of utility the application of tokens and crypto is still hotly debated while the cost of energy consumption is real, tangible and costly so how do we weigh that cost benefit? >> kristina, it sounds good. >> but now if bitcoin goes back to 60,000 would miners be as willing to shutdown? >> this is a hypothetical and as journalists i can say i don't know the answer, but it does raise the question if they're making more money will they be willing to reduce their power right now, perhaps because electricity costs so much and cryptocurrencies are so low. so you have to think of the cost benefits in this scenario, but i don't work there >> let's ask someone who does, kristina thank you very much. >> our next guest runs riot bloc
2:15 pm
clain and chain operations in texas and they've seen the shares down 14% as bitcoin prices rebound and they're still down 70% this year jason less is the ceo of riot block chain. >> thank you for having me >> with energy prices in crypto where they are today how much less are you giving up than if bitcoin was back at 60k and energy prices are also where they are today >> it's really a dynamic calculation. there's a bunch of market factors beyond just the bitcoin price and there's the competition beyond bitcoin mining that impacts on a dollar per mega-watt hour basis so as a miner, we look that the and then we can also make a judgement call in the power market if it's worthing it to mine or if it's worth it to curtail our energy and sell the power block that we invested in and secure it back to the market alternative three, there are different demands that reduce
2:16 pm
our energy costs manually and help support the texas grid in the communities that we operate in >> i notice that you have been selling power back to the grid and it would equate north of $500,000 what do you mean by that >> that was not a quote from me. i'm not sure the math behind that, but i will tell you that the price of power in ercot will tend to speak to pretty high prices when there is not enough energy in that grid and that is when renewable generation sources like wind are not blowing. when there's no wind blowing that grid will have a lot less capacity than it otherwise would. >> you basically have energy credits or something to that effect that are so valuable right now that it equates to a bitcoin price according to this source half a million dollars? it is a good reminder that maybe market pricing can help here level out the power distribution
2:17 pm
on the electricity grid and at least that's the optimistic greeting. >> absolutely. let me put it this way bitcoin miners like riot make huge commitments into energy grids and energy markets we have commitments to purchase energy for two years and that's a reliable demand that generators and organizers can look at and rely on. because we made that commitment we own a block of power that we can make available back to the grid when market conditions need, when market conditions call for and spot prices are spiking up very high, yeah it equates to equivalent to a bitcoin price mined very much higher than where it's at now. >> do you sell that power back at a profit? >> yes, with the block of power that we have secured we can shut down and we will sell that power back at a profit and at a margin much higher and at a price much higher than what we're securing it for provided that that price is higher than what we would get
2:18 pm
from otherwise mining bitcoin. >> do you have any idea what percentage of -- of state output intexas you all consume or mine -- or bitcoin miners as a group consume? >> is it negligible or significant? >> right now i would say bitcoin miners are probably around 1% of the total peak demand in ercot there are a lot of projects under way and a lot of businesses -- publicized plans to extend on texas and to the extent they follow through on that depends on their ability to raise capital and execute and the more bitcoin miners that are able to deploy in texas participate in the great response programs and the stronger the ercot grid is going to be because generators and grid operators can rely on a consistent power source 24/7 that has the flexibility unlike other major loads to shut off when demand for power is high. >> does that make texas still an
2:19 pm
attractive place for you guys to operate or how does this kind of series of energy price spikes and heat wave problems made it worth looking elsewhere? >> it absolutely reenforces our strategy in texas. the power market in texas is an ideal place for bitcoin miners and having the ability to participate in the different programs helps lower the cost of production which is the goal of any business and especially a bitcoin miner and on top of the energy benefits and texas is the place to do business and they're welcoming to all businesses and they're very welcoming to bitcoin companies and bitcoin mining companies specifically. from every level of government, we have received a ton of support there and that further reenforces our commitment to investing in texas >> how is the air-conditioning where you are right now? >> i am personally in our orange county office right now. so i am not out of texas, but speaking to the team, it is very hot out there, but they are
2:20 pm
committed to our mission and they're happy that ryan is making money. >> california doesn't have any energy problems, so -- >> all right, jason. thank you so much. thank you for having me. >> enjoy orange county >> coming up, everyone is watching netflix, at least the earnings could another subscriber slump and share decline be a catalyst for more media m and a plus speaking of earnings, which stocks are set up well on a technical basis headed into results? we'll break it down in today's three-stock lunch and going green, how one is odinprucg hydrogen power our clean starts returns later on "power lunch.
2:21 pm
2:22 pm
2:23 pm
it has been a rough start of the year for media stocks. netflix down 07% roku, 60 warner brothers down 40% paramount global looks like a winner down only 17%, but could this media mayhem lead to mergers? julia boorstin joins us now. there are lots of mergers in media, seems like, julia >> there have been lots of mergers in media and now we're trying to figure out what the next round of mergers will be, tyler, and the lower these media
2:24 pm
stocks fall the more these companies can become targets for m and a. netflix kicks off media earnings that report tomorrow afternoon and its results will be very closely watched. netflix shares are down 67% year to date and earnings tomorrow will be under the microscope particularly guidance for subscriber trends in the second half of the year as analysts raise concern, the key bank says streaming may not be recession proof and price sensitivity increasing and that company lowering its netflix and roku estimates morgan stanley saying this could be the first streaming recession downgrading both paramount and fox. so which companies could look to buy the likes of a netflix or roku if their stocks continue to plummet? well, microsoft could look to its newly inked ad relationship with netflix as a starting point for more partnerships there. apple has shown it's growing
2:25 pm
interest in media with recent sports deals, though apple sell a buyer and constrained by regulatory scrutiny and then there's a comcast and nbc universal and cnbc's parent company. it could be looking for more skill on the streaming ad space. others can feel pressure emerge as advertisers are expected to pull back. i am talking about paramount and warner brothers. the latter is reckoning with a heavy debt load. the number weise see this quarter could give us hints of what kinds of deals to expect in the next few years >> very, very interesting. it's amazing how netflix has gone from a presumptive buyer t potentially a seller >> it all depends on how low the market cap goes. this is still a big company in terms of market cap closer to $90 billion, but if the market cap drops closer to $70 billion that would be in the same range
2:26 pm
as disney's acquisition of fox and that starts to be a different conversation or even in the 50 or $60 billion range there's also this question, tyler and kelly about whether or not you value the likes of netflix as a media company or tech company. >> julia, thank you very much. julia boorstin reporting >> let's get to bertha coombs update for a cnbc news update. >> good afternoon. here is your cnbc news update at this hour. four people are dead after two small planes collided at a nevada airport the pair of single-engine aircraft each kaeshing two passengers that crashed into each other one plane was preparing to land when it collided with the other. extreme heat in the united kingdom causing a runway damage and disrupting military and civilian flying. flights were temporarily halted at london's lutin airport after soaring terms caused a defect in
2:27 pm
its runway temperatures are expected to reach, rather, 100 degrees fahrenheit today new york's governor kathy hochul to implement heightened patrol and surveillance of shark activity, this would include drone and helicopter monitoring state park beaches due to sharken counters in the atlantic ocean. it will include lifeguard staffing at oceans and beaches by 25% it's kind of like jaws all over again, kelly. >> the lake's looking better than ever. >> right >> bertha, thank you very much bertha coombs. ahead on "power lunch," boeing under the radar and the company getting its first order from delta in more than a decade the stock down this year, but could it be ready to take off on the back of a pretty strong month. plus an arch nemesis some mcdonald's franchisees supporting a no-confidence vote on the ceo
2:28 pm
details when "power lunch" returns and the shares of apple and the stock fell 2% on reports that the company would slow hiring in certain areas of the business in the coming year and took the dow and the nasdaq down with it anitd is still down 1.5% stay with us you no longer needw you can sell your policy - even a term policy - for an immediate cash payment. we thought we had planned carefully for our retirement. but we quickly realized we needed a way to supplement our income. if you have $100,000 or more of life insurance, you may qualify to sell your policy. don't cancel or let your policy lapse without finding out what it's worth. visit coventrydirect.com to find out if your policy qualifies. or call the number on your screen. coventry direct, redefining insurance.
2:29 pm
2:30 pm
2:31 pm
welcome back, everybody. 90 minutes left in the trading days we've gone into the red and we want to get you caught up across the markets on stocks, bonds, commodities and boeing. we ask are those shares about to take off let's start with bob pisani down at the new york stock exchange bob? >> and we were tooling along modestly positive and slipping a little bit and then about an hour ago we got some reports -- not confirmed that apple might be slowing hiring and you see what the effect was. apple was positive and most big-cap tech was positive on the day and we moved in negative territory on that, and predictably apple suppliers moved down and the important thing is think of the context here remember, apple only gets a third of its revenues in the united states. about 25% of apple's revenues are over in europe would it be any surprise if sales were slower in europe? and they get about 20% of their
2:32 pm
sales in china would it be any surprise given the lockdowns if there was slowdown even in the revenues. this is not entirely shocking assuming that this information is true that we move slightly to the downside the question is would it affect the broader markets and so far the earnings have not been dramatically dropping in the overall market so apple is the most important stock in the united states right now. so obviously, we'll pay more attention to that and you see modest declines here in most of the big-cap tech names that we've seen also another interesting feature is they've been nibbling on tech stocks earlier this afternoon and the defense names have lost their cache, kimberly-clark, johnson & johnson, clorox and which have had a great little run and people are interested in the growthier part of the market and how will apple turn that position around.
2:33 pm
finally, i want to note with energy and oil at 102 back up again people aren't ready to give up on energy stocks although they, too, have lost their cache. the key here, kelly is a lot of growth people are dying to buy tech stocks on a fourth-quarter turnaround and whether these reports about apple are going to sour them on that kind of deal >> no, great context, bob. >> thank you very much our bob pisani >> in the bond market, that's been a immediaheadwind now we're down to around 2.96 this afternoon as the move has turned cautious. yield still below that of the two-year which is 2.16% and all of this happens as the market continues to wonder whether the fed will hike by 75 basis point in its meeting next week and it looks like a hundred is off the table for now and it's not doing much to push yields
2:34 pm
significantly lower. >> as with oil, it's closing for crude and reaching above 102 a barrel in the last few minutes and pippa stephens with the story. pippa? >> that's right, kelly we are back about a hundred bucks on u.s. oil as this market volatility continues and we had this ongoing disconnect between the physical and the paper market ubs saying the recent demand concerns are triggering a massive liquidation by oil conditions while the physical market remains tight meantime, president biden's trip to saudi arabia not yielding an immediate agreement to ramp up output and the president saying the saudis share the urgency to increase supplies and to expect further steps in the coming weeks. opec is set to move on august 3rd and saudi arabia, of course, the de facto leader and at 102.56 and brent crude up 5% at 106.23 and nat gas up 7% and approaching the 7.50 level and
2:35 pm
that comes as much of the country and the world faces scorching temperatures and that, in turn, kelly, driving demand for nat gas. >> thank you very much, pippa stephens >> let's zone on 3% and now hanging on to two-thirds of a percent gain with delta agreeing to buy the 737 planes. marking delta's first major boeing order in over a decade, but as boeing looks to turn a new leaf, a handful of problems continue to plague the company including regulatory issues with the 737 dreamliner boeing ceo david calhoun spoke earlier with our phil lebeau on the matter. >> will not predict, but it's a constructive relationship. we've progressed through everything as everybody knows we submitted all of the documentation a while ago. it's been worked through it's in a good place so i am just as optimistic >> he expects to deal with the
2:36 pm
supply chain issues for 18 months more. let's bring in colin scarolla. >> boeing shares have been on the rebound over the past month or so. how big a deal is the latest news for them? >> the thing is it's always good to have a premiere airline like delta give you a good vote of confidence for your top products and it's a big win i think it speaks a little bit to an advantage that boeing might want to start to be getting back in terms of airbus having very long lead times and probably expecting higher pricing and boeing being willing to take a lower pricing. this is a good signal that boeing might be chipping back at that lead. >> when you put it that way, i don't feel quite as excited. you're basically say airbus
2:37 pm
planes will take too long so you basically have to go to boeing and how long is there are back that you're describing >> i ng that's an interesting question and sometimes when you're trying to make an investment case for boeing there becomes some confusion that sometimes people think you're saying this stock should be back in the $450 range where it was pre-pandemic that's not true. you can make 60% of your money from today if it's 40% below its pack, but just in the next year. i think it's laking free cash ney as these mass tresses get delivered out of inventory the 737 will be back out for
2:38 pm
deliveries by the end of this year we can't predict that timing, but some time this year. within a year you won't have boeing anywhere near pre-pandemic earnings levels or pre-max earnings level, but even at just 50% of what they were making before there could be a very attractive investment over the next year. >> make the case for us, colin, that buyers will look past the reputational troubles that boeing has suffered over the past years with the 787 dream liner and with the 737 max 8 -- 800 max. looks like -- >> on the max we no longer have to try to make that case delta's orders today, a huge backlog of orders with companies like southwest, united there's huge confidence in that planning people want it for its high performance and probably a better price point, so i think that case is making itself
2:39 pm
there's a healthy backlog for maxes. if they could be delivering more they would, the market is certainly there. >> interesting >> when you're a business it's better to have short-term problems in the market and the market will help them heal that. >> i don't mean to draw too close a comparison, but some years ago if you recall, audi had a premium product in the market and safety issues arose with it and at that time people were very quick to write the obituary for audi and that company has come back in the marketplace very, very strongly. i'm not sayinging this is direc comparable and that i don't mean to compare one to the other excessively and it's always wise to take a long view, i guess. >> that's a point. financial is replete with a very short term oriented market place and something that companies were going through challenges, but over the long term they have
2:40 pm
good fundamentals for their business so those are two things to keep in mind with boeing. they've got major operational problems, but this is still a very valuable dee oply type business and a long term growth market and that's a great place to be invested over the long term and i think month by month they are starting to show us that they're overcoming these operational problems so you've got to be patient. there's certainly a lot of hair on the stock, but the operational problems and plus the debt but again, you have to keep in mind, not just getting back to the 50% of peak stop price >> i like that image of a hairy stock. colin scarola, appreciate it. >> thank you. d 'lhilit e is a clean start anwel ghghonmethod of reducing fossil fuels "power lunch" will be right back
2:41 pm
2:42 pm
2:43 pm
to anyone that thinks they know what "nope" is about i would say... nope. you got a summer blockbuster on your hands. it is so hard to predict the mind of jordan peele. welcome back to "power lunch," everybody. in the move toward renewable energy, you hear about hydrogen, but is it clean energy that's a bit of a gray area.
2:44 pm
diana olick joins us with her continuing series on clean start-ups. >> tyler, hydrogen produces next greenhouse gas emissions and extracting hydrogen to create fuel does and that's the problem. one company, electric hydrogen can produce truly clean hydrogen and investors are banking on it. >> our goal is to be selling the world's leading equipment set, the most cost-effective equipment set possible for the production of renewable hydrogen. >> electric hydrogen to create green hydrogen the systems use renewable energy like solar and wind to split water creating fossil-free hydrogen power and it's deriefderieved from natural gas >> when the sunis shining and when the wind is blowing we harness that cheap, renewable
2:45 pm
energy to make renewable hydrogen or fossil-free hydrogen >> and the first czechotechnoloy officer for clean hydrogen he expects to sell it to amazon. >> electric hydrogen is addressing ocean shipping, steel manufacturing, aviation and these are ones that are important for amazon to address. >> backers include amazon, breakthrough energy venture, mitsubishi, fifth wall, capricorn, energy impact partners and s2g ventures. total funding so far $220 million. cost, and elect roric hydrogen claims it could be coveragetive with fossil fuels. we have an update on one of the clean start-ups we brought you
2:46 pm
earlier this year, source water that creates clean water from solar light panels is announcing $130 million in new funding led by microsoft, black rock and duke energy. to see the segment again, check it out on the clean start page on cnbc.com. >> back to this hydrogen company, at what type of scale can they produce power >> they believe the larger they can, the better they can and they're starting with the factories for hydrogen where they can create these and they don't create the hydrogen themselves and just the systems and they'll sell the systems to big companies and it's up to the company how large they want it to be, but on this larger scale they can do it more cheaply. >> diane a thank you very much diana olick. >> up next, a technical edition of three-stock lunch which names are set up well ahead of quarterly results and which aren't and we'll hear from two big bank ceos coming up on cnbc brian moynihan joining "closing
2:47 pm
bell," and at 6:00 p.m., david solomon from "mad money" from its brand-neloti fw caonrom the new york stock exchange. a short walk for him "power lunch" will be right back
2:48 pm
- hiring is step one when it comes to our growth. we can't open a new shop or a new location without the right people in place. i couldn't keep up until i found ziprecruiter. ziprecruiter helps us get out there quickly and get us qualified candidates quickly. they sent us applicants that matched what i was looking for. i've hired for every role, entry-level technicians, service advisors, store managers. ziprecruiter helps me find all the right people, even the most difficult jobs to fill. - [announcer] ziprecruiter, rated the number one hiring site. try it for free at ziprecruiter.com
2:49 pm
2:50 pm
welcome back to "power lunch. let's show you the markets we've lost today's rally the dow up 156 points and now we're sitting near session lows down 80 about a quarter of a percent and down on the nasdaq and about a third of that for the s&p. time for today's three-stock lunch. we take a technical look at domino's, tesla and jb hu bb hu see which is set for a breakup or a breakdown let's bring in greg johnson from piper sandler. first up is domino's, what do you think? >> we started to reverse this longer term downtrend. this is a stock with probably one of the bigger option moves, up 6.3% when they report results on thursday before the bell. from our perspective, i think this is one we've got to buy we're seeing lots of upgrades, a
2:51 pm
lot of promotional activity and i think domino's is one that's ready to take a next leg higher. >> what about for tesla? >> in terms of tesla, i've got this as a bottom fishing candidate. the shares have been stuck in the consolidation range for 18 months or so we've got an options moving coming up, about 5.3%. the stock is in the 40% change range off of its all-time highs in here. and from our perspective, we're starting to see technically an improvement in the momentum indicators, rsi, lower end of the range. this is one we should be trading to the upside coming into the earnings print later this week. >> interesting call there. let's move on and take a look at jb hunt, the big trucking company. >> i think this is a super interesting telltale in terms of what's happening in terms of transportation across the united states looking at these truckers this is one that's going to be tomorrow before the open we're down 22% off of our
2:52 pm
52-week highs. we also have got a pretty decent option move around 4% for this and we're starting to hear discussions of softening stock prices in the trucking business. so i think this will be a really interesting setup. but from our perspective, just looking at the chart, we have broken the uptrend support line. we're back below a declining 40-week moving average at this point in time so we see downside to about 155 >> today's rally, craig, has petered out. it's collapsed why do you think that is is it worrisome to you >> well, i think some of this comes from the news from apple i mean apple has been a company that has obviously been a bellwether out there for years and we are starting to hear some softening with them as they're going to slow some of the hiring going into 2023. i think we also had a pretty big move on friday we're giving that back a little bit. we're still in the middle of earnings season. i think a lot of investors are sort of waiting for earnings to
2:53 pm
decline meaningfully in here and so far we haven't seen that happen yet. >> oh, are we ever in earnings season craig johnson, we thank you. piper sandler, chief technician. coming up, growing trouble nfme franchisees are showing no coidence in the mcdonald's ceo. that story next.
2:54 pm
your record label is taking off. but so is your sound engineer. you need to hire. i need indeed. indeed you do. indeed instant match instantly delivers quality candidates matching your job description. visit indeed.com/hire
2:55 pm
some mcdonald's franchise owners are becoming
2:56 pm
disenfranchised with the company's ceo. a new survey out from a franchisee group said a majority supported calling for a no-confidence vote kate rogers has more on why they're so frustrated. kate. >> the national owners association, which is a large independent mcdonald's franchisee advocacy group recently polled it's nearly 1,000 members and about 700 responded. an overwhelming 87% support calling a vote of no confidence on the ceo and the u.s. president. it is worth noting mcdonald's has reported it has 2400 franchise owners in total. the poll comes on the heels of changes being made to the franchise system that include evaluating new operators equally instead of giving preferential treatment to spouses and current owners and separating its lease renewal process from assessments of whether owners can operate additional restaurants owners are frustrated about the changes. the survey found nearly 100% feel the company should have
2:57 pm
consulted owner leaders before announcing changes 95% feel senior management does not have the best interests of its owners in mind 83% believe this is a veiled attempt to raise rents this also comes as mcdonald's looks to recruit new owners to the system, including a $250 million pledge to help diverse candidates over the next five years. >> they surveyed a third to a quarter of the existing franchises is this the survey usually representative of how everybody feels or is it just a vocal minority have there been no-confidence votes before >> this is the first one i've covered since taking on the beat with mcdonald's in the last few years. there has tensions with these two groups mcdonald's has 2400 owners and this group has about 1,000 members and 700 responded. 87% called for the no-confidence vote so numbers are certainly incorporate. these groups have butted head
2:58 pm
before there was a tech fee the company claimed it was owned by owners they went back and forth and settled on that. we reported on a new grading system that the company is rolling out that some owners felt is harsh and will isolate workers during this ongoing labor crunch it is important for viewers to know franchisees run some 95% of mcdonald's operations so the relationship between owners and corporate -- its u.s. business in particular has been very strong for the company even in the face of inflation so we'll see what this quarter brings certainly a key relationship here and some head butting going on. >> i'm curious, you mentioned at one point that some believe this is a ploy by the management of mcdonald's to raise rents because they have control over the lease. in what sense do they have control over the leases? they're not the owners of the land or the buildings, are they? >> in some cases they are. if they are not, they do negotiate those lease terms for
2:59 pm
the franchisee, so that's where you're getting that veiled attempt to raise rents mcdonald's uses the term franchisor but the owners in some cases will say landlord because in certain instances that is the case. >> so this is a case where the franchisees are really saying mcdonald's, you did something that is injuring us. you've changed the rules of the game >> without consulting first, which i think is the key point here. >> right >> nearly 100% said they felt they should have been consulted before these changes were rolled out because, you know, there is a large group of franchisees, owners here, some of them have been in the system for a long time mcdonald's is looking to bring new owners into the system as well because it wants to move the company ahead. both of those things need to work in concert together to be successful. >> kate, appreciate it. >> thank you. let's take a look at shares of alphabet which look a lot different than they did for friday the 20 for 1 stock split took effect today after being announced way back in february when the stock was trading -- it
3:00 pm
was announced on friday, the stock was trading above $2,000 today 108. get used to seeing that on your screens. that's around the new territory we'll be following. >> if you woke up this morning and looked at that and thought it was a $100 stock -- >> it hasn't been that bad. >> thanks for watching "power lunch. >> "closing bell" starts right now. >> see you tomorrow. stocks give up sizeable, early gains. the dow had been up as much as 350 points and we are sitting near session lows right now. the most important hour of trading starts now welcome, everyone, to "closing bell." i'm sara eisen take a look at where we stand in the market the dow is down about a third of 1% s&p down about half of 1%. wti crude is popping 5% today, lack of any concrete deal from the saudis after president biden's trip energy is the top performing sector materials and consumer sc

44 Views

info Stream Only

Uploaded by TV Archive on