all right. i decided to talk about one of the hot ipos of the day. this is splunk. it's up 87% on today's trading session. it's a technology company that minds data and information. >> no ker plunk. that will do it for "power lunch." >> we'll see you tomorrow. "street signs" begins now. welcome to "street signs" where today we are batting a thousand. 18 big companies reporting earnings. all 18 topping estimates. but the markets are saying, we're going to find out why. and show you the mystery chart that has some very worried. you may think it's better to buy 50 shares of a $10 stock than one share of a $500 stock. we'll show you why that may be the exactly wrong thing to do. and the old dead airline making a comeback, kind of. more bacon news, kelly. would you eat 1,000 pieces of

bacon on a burger? one guy did. we'll show it to you. >> brian, thanks. disappointing data sending stocks lower. the dow would be actually about 20 points worse if it weren't for travelers which is jumping at positive earnings. s&p 500 heading maybe for its ninth losing day in 12 sessions. by the way, still positive for the week. we'll see if that still holds tomorrow. and nasdaq wins the volatility award. swung between gains and losses and trading about 1.5% range over the course of the day. and we want to bring your attention to apple shares. they're at their lows for the session. dropping below that $600-mark. street insider.com is reporting data from verizon suggests apple may miss expectations for iphone sales when the company reports earnings next week. >> that is a low for apple for the session down $17.57. when that came out apple down about $2 less than that. keep you up to date on apple all hour long. as the song says, let's kick this off with earnings, baby.

so many companies are beating it. i know that earnings not often the sexiest thing to talk about, but after a stock is just the future value of earnings, right? we had to look at 18 different companies and all 18 beat consensus estimates. here are some of the biggest beats. the biggest of all today and that was travelers. kelly talked about them a bit. travelers beating by a big time margin. the stock being rewarded as well. morgan stanley also beating the street. that stock up. bank of america, you know, the headline beat some people saying more of an accounting move, stock not responding as well. united health care a beat. free port mcmo ran. companies who lose money as long as the loss is less than predicted. we don't have time to go through the remaining 13 companies that beat the street. but you get the point.

earnings are topping analyst estimates, but the dow is down today. let's go now to bob pisani who may have the answer as to why earnings aren't rising all tides and boats, bob. >> well, it's not that things are bad. they're not bad. it's just that they're not good enough. that's been my whole theme throughout the day. there's a couple data points besides earnings. i want to bring up about why we're not moving here. let's take a look. i talked about home sales. very rarely does existing home sales move the market. but they're down month over month sequentially. we need improvement. we don't need down month over month. weekly jobless claims spiked up in the last two weeks. the trend has been generally declining weekly jobless claims. last two weeks kind of a reversal here. and here's your earnings comment. companies have been beating, but the beat's been modest. everybody got concerned we were only getting 1% earnings growth as going into the first quarter here. that 0.9% has gotten better thanks to the 18 companies today beating we're up to 3.1%. but those are still pretty

modest. and here's the issue, the real problem, take a look at the s&p 500 here. we are up rather notably in the last three to five months nicely. now, if this thing was down here around 1300 or 1250, then i'd say we're a lot more interesting. right now the market looks fairly fully valued. that's why we need better news to get things moving forward here. back to you. >> bob, thanks so much. we want to get to mary thompson with breaking news. >> that's right. regulators issuing a statement on the volcker rule. keep in mind the statutory effective date for this rule yet to be written is july 21, 2012. regulators issuing a statement saying the banks that will have to comply with volcker have two years to conform to the yet to be written rule. so they have to be in compliance with it by july 21st of 2014. as i said, the rule has yet to be written. so there remains a legal black hole for the banks to fill at

this time. nonbanks systemically they have two years from the date they are actually named as nonbanks. you might recall earlier this month regulators met to declare what a nonbank sifi might be. again, during this time this two-year conformance period, regulators say banks are expected to engage in good faith conformance activities on volcker which i will say yet again we don't have yet. they keep waiting for it. one thing to note, brian, the fed has the option to extend this conformance period. >> mary, i will see you two years exactly from the date of yet some undetermined day. >> okay. >> i'll see you then. >> to date. >> thanks very much. let's go back to our earnings theme and bring in ceo of the mcill vainny group. you heard us 18 of 18 beating the street but you heard bob earnings are slowing down. why hasn't the market reacted more positively?

>> well, i think quality is one thing. creativity is another. in certain instances you mentioned earlier there are accounting gimmicks that have been used particularly in the financials which have given them great numbers but actually looking deeper. you find there's not much there to support it. the big questions inklingering in the minds of investors are macro theme. you see slowing growth in europe. you see slowing growth in china. and numbers here in the u.s. whether it is the jobless claims or the housing numbers which leave some questions. what takes us to the next quarter? what makes us as an investor get excited about q-2, q-3, q-4 not looking back at earnings past? why should i be buying today? i think people are very concerned as they look ahead. >> david, what's interesting is there are a lot of people on wall street saying they expect the fed to come in again which is why they're keeping risk on. you say that's one reason why you're taking risk off and increasing cash allocation. >> what we've seen with the last couple of instances qe-1, -2 and then twist is there was an expiration of the fed's

activity. the market swooned and then in response to a market swoon the fed got very proactive again. but not really on a proactive basis. we don't know what it's going to look like this year to be quite frank with you, kelly. this is our challenge as we come into june twist expires. will they in response to a market swoon initiate -- and frankly i think the market swoon will be tied to disappointing second quarter earnings, will they step in with qe-3? will there be an extension of twist? what will the operations be? i think that's another question people have. and we would suggest people begin to take some risk off the table increasing cash allocations. >> david, you said something interesting in your first answer. you said in some cases it might be creativity. do you think a lot of the beats are just having to do with balance sheet -- i don't want to call them gimmicks, but earnings, you know, manipulation. if that's a better term. >> i do. in some instances it's that and

other instances we've set the bar so low that meeting expectations people realize that the business franchises themselves are not making enough money. freeport is a great case in point. 85 the estimate, 96 cents the actual. low and behold they're trading flat while they beat estimates. if you look at year on year performance, they've been gutted. from a year ago they went from a billion and a half in first quarter revenue to about $764 million in revenue. so this is where you're seeing a decline fundamentally in business. but on the basis of setting the bar here and just meeting it or just beating it, people are still looking at the fundamentals and saying, listen, if china's slowing, what do we think about copper and the largest company on the planet that mines copper? maybe we've got some bigger picture issues to be concerned about. that seems to be what is keeping a cloud in the air so to say. >> you know, you said also second quarter earnings would probably disappoint. why do you say that?

>> well, i think that the productivity gains that have been put into the system really over the last two to three years, we've gotten everything we can out of it. and the fact that we are seeing some gimmicked earnings and creative accounting to get us to better than the estimate numbers in the first quarter, i don't know what you do for an encore in the second quarter. >> david, great stuff. thanks. we'll see you again soon on cnbc. take care. >> good to be with you. >> the market's not just about earnings today. and thus we present this. we are calling it the mystery chart. can you guess what it is? doesn't look that bad, but later in the show we'll show why some people say, you know what, this is spooking them out a little bit and there could be a reason the markets are not rallying today. the mystery chart, kelly, later in the show. >> all right. now to another story we're following at this hour. a major investor is ready to take on a member of the goldman sachs' board. kate kelly joins us with more. what's going on? >> there's a major investor in goldman sachs as you said that's finding fault with one of their

directors. james johnson, former ceo and chairman of fannie mae. also the manager of the board of target and previous board member of united health care during the options back dating flap that effected them. all of the above. this group -- and it's ruane, cunniff. we are against him, many of their own shares to vote against him. they didn't make it into the proxy filing that goldman put out about a week ago. but they said this letter issued yesterday on their website is in response to the proxy. and they're hoping they can gather some traction for this. interestingly, too, they're not known as an activist fund. this is kind of unusual for them. >> and it also follows the notable decisions we've seen with shareholders coming out against citi and otherwise. for them does it have something to do with their specific approach or concerns about this guy or tell us something more broadly about shareholder activism? >> that's a good question. the fact a fund family like this

not known for activism would come out strongly against this director tells you there might be something in the air, you know what i mean? it's interesting they've singled one director and build some opposition to him. i should say i called director johnson and goldman, they didn't get back to me by press time. goldman is standing behind him based on other reports and think he's been good for the board. i believe he's the chairman of their comp committee. that's not an unimportant role. and goldman's been under fire for other things in corporate governance. there was real pressure this year from a public employee's union to separate the chairman and ceo roles. they resisted doing that but did name a lead director. and i believe he's taken some criticism as well. this could be an interesting proxy season. >> and been on the goldman board since they went public in '99. a long time member. and they continue to voice their concerns. >> right. i think maybe in some cases the squeaky wheel gets the grease.

you do see some reoccurring shareholder suggestions and they hold for a while and hold traction and others go away. frankly, i would be surprised to see this guy voted off the board. the goldman recommendation seem to carry sway almost always. but who knows. >> 2012 could be different. >> absolutely. >> all right. kate, thanks very much. up next on "street signs," priceline currently leading the race to $1,000. can it continue its high flying ways? >> were you waiting for that? >> yeah. i was waiting for the tune. speaking of priceline's price, here's a quiz. better to buy one share of a $100 shock or 20 shares of a $5 stock. it will cost about the same but what's the better value? the answer might surprise you. we'll have it coming up. [ male announcer ] at scottrade,

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take a look at e-bay. surging on a 20% jump in profits. the auction site is now seeing its biggest intraday gain since 2008. priceline.com meantime is another dot comwith a soaring stock value. up 55% year-to-date now trading around $720 a share.

the company's ceo is on "squawk on the street" earlier today not revealing much about the stock, but he did say this. >> let me ask you the other way around then. there's a discussion about whether you, apple or google will get to $1,000 first. which do you think? >> i don't have an estimate for you. i'm very, very flattered for our group to be talked of in the same breath as those two great companies. i think i'll just leave it at that. >> all right. nice answer. but with the jump of about $250 per share just this year, is there still room for priceline to soar? joining us analyst at barclays. anthony, is priceline going to hit $1,000? >> yeah. i think for these big cap internet companies that have real earnings and have real earnings growth, i mean, priceline's earnings growth is in the vicinity of 40% or 50%. so with the stock trading at a multiple of less than 20 times earnings, i don't think it's unreasonable to ask the market to pay 25 times earnings given that earnings growth. you see with e-bay this morning

there's another company that's got real earnings and then revenue growth in excess of 20%. so these big cap internet names that have real structural growth opportunities like priceline, like e-bay, like google, we continue to see room for upside on those types of names. >> anthony, for priceline though, how exposed are they to europe? and how much of a slowdown in europe is already priced in? >> i think europe maybe dominates too much of the conversation of priceline. i think really the opportunity for priceline is in asia, is in growing its booking.com brand perhaps even north america and newer territory. i think the fluctuations in currency in europe just get a lot of air time. maybe they drive the stock in the near-term, but over a longer period of time, consolidating all of those i think it's over 200,000 hotels globally onto their platform in 160 countries. growing booking.com and real network effect of that business, that's structural. >> so people who view this as a name your own price, that's old, right? >> yeah.

>> that's not what priceline is anymore. >> yeah. i can tell you personally i'm getting married and we're looking for room blocks online. and my fiance found a cheap room block on booking.com. said what's this booking.com, it's a great site. i'm like that's priceline. it's not the name your own price william shatner brand. i think in the u.s. even people who just think about priceline, they don't think about booking.com. and that's a tremendous international hotel platform that will continue to grow. and you think about international bookings, international bookings are in excess of 50% year over year. so that's part of the misconception about priceline. it's just a tremendous global structural opportunity. >> anthony, priceline's up something like 55% this year. it's a remarkable run. is this the point people want to get exposed? >> yeah, any time you look at a chart straight up like that, the tendency is to say wait for a little bit of a pullback or breather, but if i just stopped and didn't look at the chart and i just looked at the financial characteristics of the stock, i would put a buy on it.

and we do have a buy on it. we like it. we launched it last summer with an overweight. we think this deserves a mid-20s type earnings multiple with that earnings growth the way it is. >> all we talk about is how bad things are in europe. and now i'm listening to you saying all these people -- is it americans going to europe to take advantage of a slightly weaker euro? >> no. but i think you're missing my point. my point is that you could look at these near-term fluctuations in the economic cycle, but that's not what priceline's about. they're about longer term structural growth through the cycles. i think a long-term investor that's a growth investor or growth portfolio manager that owns that stock is not worried as much about the spanish bond offering. i'm looking at in terms of what the long-term opportunities are. >> why don't they sell more stock, anthony? 49 million share float, zynga's got 700 million shares outstanding for pete sake. >> look, for a company that's as cash rich and generates as much

flow as priceline, they don't need the markets to come to cash. >> that will send a chill down someone. they don't need capital markets. that will send a chill down wall street's spine. >> it's actually an interesting comment because it's true about a lot of big cap internet. they've got these massive cash hordes. look at google. look at apple. they have a tremendous ft. knox-like cash horde in themselves. it's not like the internet bubble of the '90s where companies were burning through cash. these companies some of the ones we're talking about are generating a lot of cash. >> anthony, before we let you go, congrats on the nuptials. i've got to give you advice. >> uh-oh. >> limos, flowers, do not tell the vendor it is for a wedding. the price will automatically jump 30% to 50%. i just need a limo, don't tell them why. trust ne on that advice. have a great time. >> thank you guys. >> be safe. >> just want to mention by the way we did try to get in touch

with the three analysts who have a hold on priceline and apparently no one has a sell rating. we didn't hear back from them, but we'd love to know their thesis. coming up after this is one single share of priceline as we mentioned or another high flier a better buy than a basket full of much cheaper stocks? we'll find out. >> and speaking of el cheapo, it opened the door for jetblue and others. it could be ready to take off again. that's right, people express may be coming back. we'll tell you about it when we come back.

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for exceptional offers through mercedes-benz financial services. that's a live look at the white house. members of the national championship winning football alabama crimson tide will meet with president obama. you can see big pomp and circumstance. of course yesterday a far more important sport, nascar. anyway, that's what's happening on the white house. the war against car racing continues here on cnbc. all right. ain't no sunshine around here today. but we have not one but two, but three disasters. herb, you're fired up, as always.

>> you know, disasters all in the eyes of the beholder. apollo group filed an ak about some credit agreement. but the news is in the other events disclosure buried at the bottom of that document. that's where apollo says it's been contacted by the s.e.c.'s enforcement division regarding information about stock sales by insiders at the end of february. that's just before the company disclosed some materially bad news about new enrollments. one of the big sellers back then was founder and executive chairman john sperling. the company says it intends to fully and voluntarily cooperate. also, not quite a disaster, but number two today, i have a piece on cnbc.com about mylan. raises questions about a cluster of analyst estimate cuts mostly within a few days of one another for the first quarter going to be reported next thursday. also, report suggests mylan's second quarter may need to be revised downward.

>> wow. >> that's like calling a wedding an other event. >> absolutely. always put it there. by the way, just go on down to the bottom. >> crafty. >> luckily we have you. you should read those releases like you read court decisions. i mean this honestly. the bottom up. start at the back, move forward. >> i like that. >> bottom up. japanese style, baby. gentex trading at lowest level in six months. they make rear and sideview mirrors for cars. earnings grew but not enough. you talk about momentum stocks f you miss or don't meet enough, this is what you get. it was the first no frills cheap airline making it cheaper to fly than drive. people's express, if you're over 40, you'll remember it well. it was folded. if you were 80, you remember flying on the pan am like herb. it could be ready to take flight

again. sort of. let's bring in phil lebeau. phil, is this the same airline coming back? >> no. >> a free ride on the name like they did with lotus in asia? >> a name. that's kind of interesting but at the end of the day we see this in the airline industry from time to time where established name from the past -- somewhat established in this case goes away, gone for a while and comes back. when it comes back, it doesn't always have a lot of success. remember midway airlines? it went away, it came back and folks in chicago said, yeah, midway's back. didn't last long. i'm not superexcited about the possibility someone's going to start-up an airline and call it people's express. >> i haven't even heard of it. why bring back this name? >> right now it's all about saying we are a low cost airline and that's how we're going to win. people want to pay as cheap a fare as possible, kelly. >> she's never heard "cosby

show." >> is that bad. >> now i know how herb feels every day. honestly. it stinks. >> if you can sell that cheap fare. and if you're effective at marketing, it works. look at spirit air. spirit air's marketing is the reason it's successful right now. >> it's genius with the secret service thing. >> absolutely. people look at that and say, okay, i'll go with these guys for a while. >> just amazes me anyone starts an airline or brings it back at this point. anyway, phil, fascinating. >> it's a low barrier to entry. >> that's a great point. appreciate it. we'll follow up on that story. i'm going to google people's express. and brian. >> oh, boy, all right. up next on "street signs," sonny, we're going to feel the mystery market wild card. the one thing some people think could hold us back going forward. >> and later americans spent $10 billion on plastic surgery last year alone. so which body part do they fix the most? it's not what you think. "street signs" will be back in a minute. >> don't look at me.

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welcome back to "street signs." get you caught up on the three top stories moving right now in today's street talk.

first up, earnings, they're up. but the market's down. stocks accelerating a midday selloff. dow down triple digits. only two blue chips in the green right now. travelers and verizon. industrial and techs big lags on the day. secondly, take a look at natural gas. that's hitting another 10-year low. just an amazing story. let's get straight to courtney reagan at the nymex with the energy close. hey, courtny. >> that's right. we get new lows keeps happening day after day. session lows after the inventory shows further built-in record high levels that we already have for natural gas. if you move on and look at crude oil, this is a fundamental story here as well. worried about consumption for the united states. you're seeing prices settle around $102 and change. and last but not least, look at gasoline. remember when we all thought $5 a gallon was all but a certainty? according to the oil price information service in the next five to ten days we're going to see prices lower than where we were a year ago. we never thought we'd say that a couple weeks ago.

back to you. >> courtney, thanks. that's amazing. look at what's wrong with zynga. the stock down 25% over the past month. that's despite the insane popularity of its newly acquired draw something app. that's the fastest growing mobile gaming app with more than 50 million downloads in 50 days. amazing. why hasn't the stock seen more of a bounce? needham upgraded from underperform to a hold. sean, you like it or don't like it enough? >> i dislike it less, at least from a valuation standpoint. the things people are concerned about is rising competition. and, frankly, the likelihood there's going to be a lot of insider selling. i think that's what's been dragging the stock down over the last month. >> talk about this acquisition. for having a popular app, why aren't zynga shares doing better? >> it is a great app. it hasn't kicked into their numbers. they report next week. that was the first app, game not made by zynga that was rated on facebook more highly than other

zynga games. it's a reminder of competition. the success are also reminders allowing extremely high market share. sometimes there's nowhere to go. >> sean, when i see insider selling at the level that zynga insider are selling at and looking at the prices they're selling for, that's got to be a big red flag. >> definitely. not everybody who is an insider, you know, has penny stock. a lot got in fairly recently. and actually under water now on their shares. the sheer number of shares that could come out over the course of the next year is in the hundreds of millions. it probably won't but could weigh on their shares as well. the recent secondary was an orderly way of dealing with some of that. there's a lot more to come. >> talk about competition too, sean, something like king.com is an example of how easy it is someone can get in on this market. are they gaining more traction? >> certainly. i wouldn't say it's predictable to come up with a hit game, but they have been able to. two competitors from outside the

u.s. showing you how global this business is, how quickly things move and how unpredictable it is to come up with hits. >> sean, thank you very much. we appreciate your insight on zynga. i'm sure we'll see you again. >> thank you. >> right now we've got to look at apple again. there's a report on street insider there's a report basically saying some of the data from verizon that may come out next week could indicate a miss in sales for the iphone. again, this is somebody's interpretation of what might come out of verizon that was put on the wires. but guess what, when the story first hit the wires, apple was down about $15.50. you just saw it. it's down over $23. it's a pretty big drop for apple. one of the biggest we've seen this year. and the entire market, by the way, is at session lows. once again, there's apple. some concern about maybe it's missing iphone sales estimates. all right. earlier in the show we showed you what we called a mystery chart. one thing that some are worried

about and think could come back to haunt us this summer, well, tell shaggy and the gang to go home because the mystery is over. the biggest drag on the markets, jobless claims. your next guess says don't worry yet. dan greenhouse joining us now from btig. always smart, dan. we have two weeks where we have missed expectations. we had a revision down. is it time to panic? >> well, the first thing for investors to remember with respect to the jobless claims number is right now there are some seasonal distortion problems related to the easter holiday and the week after the easter holiday. this traditionally gives the government some problems. and so i think before anybody starts freaking out about some much larger problem in the labor market, we definitely need let's say two more weeks of data. >> dan, our first guest pointed out that jobless claims actually missed something like the past nine weeks. so, yeah, it's easy to kind of say this might be a little seasonal weakness, but shouldn't we be paying more attention to perhaps if not deterioration the slowing improvement in the

underlying trend? >> i think you're exactly right as always. let me just add what the jobless claims number's really telling us is if anything it's just simply refuting the more bullish case, which was everything was fine and we're going to extrapolate out this trend and we're going to be adding 300,000 to 350,000 jobs by early spring, summer. that's clearly not the case. and those of us that have maintained a much more moderate view of the economy of the labor market and the investing landscape are once again being proven direct. >> dan, remind us where do you see unemployment at the end of the year and where do you see the s&p? >> well, with respect to the unemployment rate, i mean, it's a little harder to judge things right now because of the under the hood measures that are sort of playing -- making it a much more interesting forecasting situation. but i'd say in the low 8s, upper 7s is probably where you're going to be if this trend continues although i would say there's more of an upside risk than downside risk. >> sorry to cut in. finish your thought. >> i had. it's fine. you're much more interesting

than i am. >> where do you see the s&p, dan? >> the s&p's a little more difficult. i mean, we're in the camp that's definitely not the consensus right now that thinks that the fiscal cliff towards the end of the year as well as some other sort of things are going to come along the way are likely going to play some games with the economy and the stock market. so i wouldn't be surprised to e stock market not materially different from where we are, although there is going to be a fair bit of volatility starting this weekend with the french elections. but a fair bit of volatility between now and the end of the year. >> i love how you weave the french elections into that. the reason i jumped in because you mentioned something the next two weeks, you know. and, listen, this could be chalk dust torture for investors, right? >> wow. >> this has been a maze. >> wow. >> you know where i'm going with this, dan. >> i'm right there with you, my friend. >> what do you want to see over the next two weeks saying now it's time to worry or we're fine? >> clearly you'd like to see the number come down. i think if we're going to be

sort of successful in gauging this in terms of the spike being incorrect, we're going to see jobless claims back down around 360,000 or so in the next two or three weeks. that would certainly be supportive of the idea that this was something of a seasonal distortion. but to kelly's earlier point, there clearly is not as much robustness if you will in the labor market than some people thought. irrespective of whether you get to 350 or 370 but the monthly employment report we're going to be adding, you know, not much more if more at all in terms of the 200,000 to 220,000 jobs we've been adding. >> thanks, dan. >> sure. >> more on apple's drop. >> and more bacon news. darren rovell, d-sizzle coming up next. [ male announcer ] citi turns 200 this year. so why exactly should that be of any interest to you?

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only hertz gives you a carfirmation. hey, this is challenger. i'll be waiting for you in stall 5. it confirms your reservation and the location your car is in, the moment you land. it's just another way you'll be traveling at the speed of hertz. i'm bill griffeth coming up at the top of the hour on "closing bell," trifecta of

earnings. we are talking exclusively with ceos about their latest quarterly results. people close to the matter tell reuters the s.e.c. is voting today on whether or not to charge credit rating agency egan-jones with making intentional misstatements to regulators when applying to be a nationally recognized rating agency. we will hear from president sean egan himself. that's at the top of the hour. >> thanks, bill. we have to get back to the breaking news on apple. street insider out with a report that there's some concern that based on verizon data the iphone sales for this quarter may miss estimates. apple stock is down $20 a share. stern ag on the phone. we have paul hick ki from the spoke investment group. shau, thanks for joining us on very, very short notice. what do you make about this story surrounding the verizon data? and what it might tell us about

apple. >> yeah. you know, to cut to the chase, we think the concern is overdone. you know, keep in mind that verizon is one of, you know, many carriers for apple. it's just one. and the iphone frankly right now it's more about, you know, international growth. so verizon did come in a little light by a couple hundred thousand units. but, you know, keep in mind in the grand scheme of things verizon again is just one of, you know, literally 200 carriers for apple. >> so, shaw, this doesn't change your view on the company? >> no. it doesn't. the 4s keep in mind it wasn't that long ago where it was refreshed and it's actually still going into new -- signing up new carriers. arguably sort of the best smartphone out there. >> but why then do you think there is such a reaction like this to this headline?

>> i think right now if you look at the market, we're definitely in a different in terms of investor sentiment before we were in a scenario where we saw a lot of buy on weakness. now you're seeing more sell on strength. headlines like this tend to kind of multiply. a little bit of a snowball effect. i mean, frankly, that's really i think frankly explains the price action right now. >> want to bring paul into this discussion too. paul, you were just looking at data comparing the way that investing in bigger more expensive stocks compares with some of the cheaper guys saying, look, i don't think you'll get a better deal by scooping up a lot of cheaper stocks, but you have to look at what's going on in apple and question that. >> well, yeah. i mean, look at it percentages. right now it's down about 4%, which, you know, stocks do have -- apple doesn't normally drop 4%, but it's been up 50% this year. and so you have a little bit of a pullback.

i think, you know, some of the concerns it did seem to turn soft this morning in the pre-market when verizon's numbers came out. i think there may be some point there. longer term for the rest of the year, it's a name we still like. you know, the volatility, you know, we saw volatility in it last week when it went down. investors starting seeing, oh, wow, it can go down. for the short-term people aren't as infatuated with the stock. >> paul knows more about the data than i do, but when i look at a reaction like this, what it says to me is the market around apple is nervous. it's had a big run, to paul's point, but they're sort of waiting for anything, right. do you think there's a lot of risk built into apple even with a relatively low valuation based on growth rates? >> yeah. i mean, right now there's definitely a lot of fear. and as paul mentioned the stock has -- keep in mind the stock was around $250 around november.

so it's still up significantly from there. and these stocks don't go straight up. it's truly been vertical. frankly not surprised with the profit taking. i think, again, i think the verizon data is getting blown out of proportion. if you look at the last quarter they shipped 37 million iphones. this quarter around 28. verizon disclosed they shipped 3.2 million -- again, that's just a fraction of what it is. and i think people are extrapolating too much. obviously we'll find out next week when apple reports. >> absolutely. shaw wu, we appreciate you joining us on the phone with that analysis. and we want to, paul, get back to your thesis which is investors will do better with the bigger more expensive shares, more expensive stocks than with the smaller ones. explain that. >> coming into this year the big question is there's all these high-priced stocks out there.

what are they waiting for to split their stocks? normally if a stock went over $100 a share, management would announce a stock split. but now we have multiples of stocks trading over $100 or even $500 a share that aren't splitting their stock. one of the questions is maybe management shouldn't be too quick to split their stocks. if you look at this year the stocks that started out the year before $100 a share have not only outperformed their smaller peers year-to-date, but they are stocks under $10 a share but more, you know, they are less volatile. >> paul. >> yes. >> has there been a real shift going on? is there a reason why we're seeing floats with smaller dollar prices than what we've seen in the stock market in the past? >> well, for starters i think one of the reasons why companies were hesitant to split their stocks is the scars from 2008, 2009 were still fresh in their minds. so they didn't want to split a stock and then get it to be too low priced.

but then now if it isn't broke, don't fix it. the stock's trading above $100 a share. they've been doing very well. so what's the big rush to -- on the part of these managements to split the stock? it keeps out some -- maybe keeps out some of the day traders and some of the names there isn't a lot of option activity. so it helps the companies have a more stable shareholder base. >> in the bottom line of your data which is great as always is basically it's better to buy one share of a $500 stock -- >> if you could. >> -- well, no, ten or 50 because you have the $500. i'm not picking on any name, but on an aggregate cheaper stocks have outperformed cheaper brethren this year. >> right. and all too often investors think if i have $1,000 i'll buy 100 shares of a $10 stock versus ten shares of $100 stock. they think a dollar increase in that $10 stock will give them more money. but all too often, you know, we forget to focus on percentages

rather than share price. we focus on share price. the bottom line is, you know, focus on the investment, not the share price. >> paul, great data as always. again, thanks for rolling with the apple discussion off the they are comfortable with 33 million iphone units sold in the quarter. they think that the street right now is estimating 30.5 million. because of international expansions and i saw a lot of international expansions, piper jaffray says they are comfortable with 33 million. we are not taking down their estimates. >> all right. up next, bacon news is next, as promised. >> travelers and verizon are the only dow names in the green. and we will be right back. >> announcer: before we head to break, here's today's "return on

retirement." mutual funds have been the traditional go-to investment because of their good returns. even though u.s. investors have more than 7,000 funds to choose from, the 100 biggest funds are nearly $3.5 trillion. what is the nation's largest fund? the answer when we return. when we got married. i had three kids. and she became the full time mother of three. it was soccer, and ballet, and cheerleading, and baseball. those years were crazy. so, as we go into this next phase, you know, a big part of it for us is that there isn't anything on the schedule.

>> announcer: todays return on retirement question. what is the biggest mutual fund? the answer, pimco total return. the holdings exceed the annual gross domestic product of finland. for more on retirement, go to cnbc.com. another great day for the stock market. the dow down 100 points. s&p off 11. we are seeing some names, like ebay and others rise. the majority of stocks, as you can see, are in the red. all right. fire up the frying pan. it's finally time for to's edition of bacon news.

darren rovell is here to chew the fat. a regular grand slam of bacon news. >> all right. let's get to -- the uk bacon crisis. okay? because you might have heard about this, you might not have heard about it. january 1st, 2013, some will not be able to put the pigs in the crates, pigpens, and therefore the production will go down, costs go up. here in the united states, $2.5 billion in supermarket bacon sold over the last year, and sales are up 2.8%. this year, it's $4.02 for a package. that's up 40 cents from last year. the unit volume, however, is down 2.4%. so there you have it there. and finally, the burger in japan. a whopper, a japanese man, you

can get by the slice bacon. costing $87. he did start eating it. luckily, it looked like he suffered an urge contrary to swallowing towards the end. >> i actually thought 1,000 pieces of bacon would look much larger than that. >> has this gone through all of the channels? >> i don't think that's this week. i am updating this every hour. >> just to be contrary, i'm going to start the scrapple. >> thank you, darren. into and, next, it's the hot new trend in plastic surgery. we'll tell you all about it. and its tools like... tdd# 1-800-345-2550 screener plus - i can custom build my own screens

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