11.5 year high against the basket of 26 currencies which has a lot of people worried about the grain markets, the metals markets, the oil markets. so it's going to be interesting to see how that plays out. susan, it's been great having you here. safe travels. thap does it for us here on "power lunch." >> thank you. "street signs" starts now. 2015 starts with a reminder that the economic recovery is still in flux. bad factory data took the air out of today's rally real quick and losses have been accelerating. brian sullivan is off this afternoon but i'm going to welcome in dominic chu today. before we get to those markets we have breaking news with john harwood regarding north korea. john? >> we've had the treasury department announce a new set of sanctions on both the government of north korea, the workers party of korea, ten individuals, three entities prohibiting u.s.

financial institutions from doing business with them. now, this is the second stage of the u.s. response at least that we know about. we remember after the sony hack in advance of the release of "the interview" movie. the internet went dark in north korea for awhile. the u.s. government did not deny that it was responsible. jack lew said in a statement this is part of a range of responses the united states is making to try to show north korea that it's not going to tolerate the kind of incursions into cyber space affecting u.s. businesses and we will see what the response from the north koreans is to this. >> but john here's the thing. north korea is already one of the most impoverished and isolated countries. number one with there's not a lot of sanction. number two, it feels like wherever there are sanctions on north korea, it only hurts the people who are already starving. it doesn't really hurt the regime. is that right? >> sure but it's an unavoidable problem. like when the internet went dark in north korea, you had

commentary saying all eight people with access to the internet in north korea don't have it anymore. the same is true of the north korean economy and sanctions applied to the north korean economy. but it's a response the u.s. government can take that is short of military action which clearly is not something the u.s. government wants to consider or think about right now. and therefore this is what you're left with. >> all right. so that's the next chapter in the sony hack attack in north korea. our john harwood, thank you so much in washington, d.c. let's get back to the markets here. you can see that stocks are lower on this first trading day of the year. dow industrials down 55 points. that's one-third of 1% off session lows. the nasdaq composite off .7%. and s&p half a percent as well. bob pisani for the new york stock exchange right now. this is not one you want to put stock in right now because of the light volume. >> i wish the first trading day of the year was not on a friday.

they're on the light side. look at the s&p 500. we started in positive territory and now drifted negative. blame it partly on oil. late in the day we saw oil drifting lower again. we did see energy names move down. though most of them still remain in positive territory. there's one that got nice today. we're seeing volume here. but you can see that's just barically positive on the day. how about laggards for the day. here's what's interesting. you play this every year. what do these three stocks have in common? they're among the best performers of 2014. they're the laggards today. the worst performers of 2014 ibm is up today. this is something you can do every day. buy the biggest loser on the first trading day of the year. seriously. people must think there's magic to doing this. >> ibm needs the help right?

we don't want to see it for the third year in a row become the worst performing stock in the dow. >> we're going to talk ibm with herb greenburg later on and mary thompson. but first straight over to bertha coombs with the nasdaq. how's it looking there? >> again, we saw the same situation there. we started off positive off the gate. the big caps are weak. apple of course which is partnering with ibm in the enterprise space these days that doesn't seem to be exciting anyone. certainly on apple's part. you had fred wilson the investor saying he doesn't think the iwatch is going to be that big a deal. i don't think so either. there's a lot of competition in wearables that will take awhile to sort itself out. it really is the russell 2000 and the small cap who is are the worst performers here in the day. they were the worst performers last year laggards. and they're laggards again today. even though we did see a move in recovery up in highs.

what's bucking the trend today interestingly enough are the energy names. we had some what looked to be on the face of it bad news coming from linn energy. also slicing dividend as well. because of the problems with falling oil prices. but it appears people are looking for a bit of bargain hunting in some of the names that have been beaten up well over 50% in the past year. and bioteches continue to shine. they are just on fire. they led the ipo market. they led the overall market. and people continue to be very bullish. although, guys if you're in bioteches, you really have to have a strong stomach because they can be volatile. >> strong stomachs on board. thank you very much. so not a very auspicious start to the new trading year. but one day does not a trend make. so what is 2015 going to look like? peter and matt great to see

you. peter, today is no exception. are your contrarian course for 2015? >> the way i look at commodities in this context is the bear market really started in 2011 when gold topped out in 2011. industrial metals topped out in early part of 2012. you had oil obviously top out in the summer of 2014. oil -- i'm sorry. let me get in between. the grains, corn soybeans and wheat. they topped out in the latter part of 2012. so oil was the last major commodity to really crash. which tells me that this is the end of the commodity bear market. oil will be the last one to recover, but gold agriculture, industrial metals will be the first to recover. from a contrarian standpoint, i would look to be buying the commodity names. again, oil is going to lag, but focus on the others.

>> this is follow-up. how much of that is predicated on the u.s. dollar taking maybe a step back from center stage? >> the interesting thing is if commodities find their own firm bounce then the commodity currencies will start to rally. the canadian dollar the brazilian riyal. i don't need it to weaken. i need others to strengthen. >> so that will be key here. how about you, matt? people called this the commodity super cycle. it doesn't sound like a super cycle to me if it resolved itself in two to three to four years. >> well, we're going to have to see. i toldly agree with peter in that peter will still see some more downside. moving away from the fundamentals a little bit looking at the data from the cftc. we have -- people are still very long, the specks who are usually

wrong are very long crude oil still. even though their positions have come way down. the position increased a little bit in the month of december. so we have a little battle to fight there i think before we see a bottom in oil. on the technical level in gold as commodities have continued to move down the latter second half of the fourth quarter, gold actually bounces a little bit. it is the very end of the quarter, but it's still having a nice trajectory here. again, i agree with peter on a technical basis we could see these things start to bounce. but one thing of course on a longer term basis is what's going to happen with the global economy. we've seen slowing around the world. except for the u.s. and it's going to be tough to have a major rally, but peter's been right in a lot of things in the past. >> and what are you seeing in the presidential cycle here as well with regards of what we can predict for this year in stocks? >> well, one of the things that it's a little bit of a misnomer.

there's reasoning behind it. it's not like with the years ending in a five. but presidential cycle, usually washington does things early in the presidential cycle makes some tough decisions that knock down the economy a little bit. but help them in the second half of the cycle. so therefore the stock market tends to go down. the first seven quarters of any presidential cycle has a bend to it. this time it was up 40%. so the setup is down. so it's going to be hard to have the big kicker coming out in this cycle. the same thing happened in just the last cycle. 2009 and 2010 actually saw a rally of 40% instead of the decline. this time around, same thing. and then 2011 the third year of the presidential cycle. we had a down year. and with it a 19% correction within that year. so the setup this year is like the last one.

i don't think it's going to give us a big third year rally. i think it's more like the last one. because the setup was different than usual. >> that's a lot of inside baseball. a lot of numbers. this is stock traders almanac here. if you look for 2015 you can't just use a january barometer. what are you expecting for the markets? people are saying it's going to be single digit stock return this time around. is that what we can expect? is the volatility going to be here? >> the consensus going into every year for the past years is we'll be up 8% to 10%. usually that's not the case. i'm of the opinion u.s. stocks are egregiously overvalued. that doesn't matter from a timing perspective, but to me that creates little margin of safety. you take that little margin of safety with qe being over with the fed raising rates, to me that's not a good backdrop for u.s. stocks. and look at it this way.

the fed raises rates which creates its own dynamic or the fed does not raise rates which the u.s. economy slows down and that creates its own. >> very quickly what's the alternative to u.s. stocks then? >> commodity-based emerging markets and i continue to like india, china, and japan will probably still have a good bit to it. >> okay. peter and matt thank you very joining us on this first trading day of the new year. just like stocks oil prices were up to start the day and then moved low. will crude bottom out? latest on that next. and later have you already broken your new year's resolution to eat right? weight watchers shares are slimming down right now. they're down more than 10% today. we're going to take a closer look at what that is like coming up after the break.

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well, crude oil seems to be stuck in the same gear. it was the weakest sector of 2014 and hit $52.03 a barrel this morning. its lowest since may of 2009. kyle cooper is director of research at iaf advisers. what's your crystal ball telling us about crude this year? >> i think it's going to be choppy but i don't think we've made the lows quite yet. i still expect that notwithstanding some possible weather-related disruptions in oil production the next couple of weeks, i think we're still on an upward trend, a very solid upward trend through the first quarter. companies still just have way too many projects in pipe that will be connected in the first

quarter. i expect current u.s. oil production of around 9.1 million barrels to rise to the 9.2, 9.3 level by the end of the first quarter. >> you meant upward in supply opposed to prices. >> absolutely yeah. >> yeah. >> it's my stijsestimation they've focused. libya had problems over the weekend and this last week. yet oil remains weak. in years past problems in the middle east would have provided more of a spark for a rebound than what we've seen here lately. i think the market is really focusing on that. until we see a change in that trend, i believe it's going to remain weak. >> when do you think we're going to see that change? when will the pivot be? when and how and at what price will prices bottom out? >> yeah i think the thing to keep in mind is there's still so much already in progress. i saw a report last week that one company was dramatically

reducing their cap-x but were going to complete projects in progress. that's what i think oil production is going to stay on the increase. i don't expect that to start to slow until probably more like the second quarter and possibly into the third quarter. there's projects that already have capital and they're already halfway through it. that's why i think we still see that upward trend through the first half of the year. and that's i think going to be a generally bearish factor for quite a few months. >> just real quick, pinpoint the price. where's the bottom? >> you know the bottom's going to be where the bottom is. one thing i'm going to watch closely in january is money flow. and money flow obviously always dictates price, but this year i think there could be a couple things going on. number one the speculators as of the last report were still very long. if they begin to liquidate, you could see extreme price pressure. based ones a sects or how well they performed in 2015

commodities all the way across the board woefully with bonds. that could pressure prices. on the flip side of that if you have a portfolio allocation model, the -- your allocation to commodities as of today is well below what your target had been in 2014. and if your asset allocations are still the same then actually those type of funds and those type of investments or money flow could be increasing commodity. i think what you're going to see in the early portion of january is a very volatile type price action based on different money flows and people either reallocating into energy because they think it's a value, or they're tired of losing money on it. and they're abandoning it. >> okay. let's talk more about portfolios and the individual stocks. kyle, thank you. while the energy sector was a big loser last year will it rebound a new year?

what's the best way to play it? bring in richard tullis. i know you agree about perhaps this being another bearish or at least part of the year being bearish for prices because production is going to keep on increasing. so which stocks in particular which companies do you think can weather this the best? >> thank you, mandy. i think it's important for investors to focus on companies that show good upside while factoring in somewhere close to commodity prices. we lowered our price deck for the next two years to $60 last week. also you want to look for companies that have balance sheets going into this downturn that could still generate good production growth and have liquidity to fund any expected outspend. for me i liken the mid-cap space, both companies should generate 10% production growth next year. better than 10% production growth versus 4-q expected

production. both have a lot of liquidity. over a billion dollars liquidity in 3-q '14. and better than 10% upside. and the small cap space i like diamondback and jones energy. both these companies are expected to produce or show production growth of 40% to 150% for 2014. both have liquidity and going into this town turn with good balance sheets. >> you're focusing there on the solid balance sheets. and i'm thinking particularly of diamondback here. low operating costs to be able to weather this. i know diamondback has some of the lowest. >> they turned it into a premiere permian player. their cash operating costs were below $20 in '14. or that's our expectation, the

way it will shake out at year end. so that still leaves them a margin of probably around $50 per barrel in 2014. >> thank you very much. you've mentioned concho newfield, diamondback, and jones energy. 2014 was a surprising year for the car industry. the big automakers did well despite all those recalls, but what will 2015 bring? our phil lebeau has his predictions next. and riddle me this. what has fallen for 99 days without stopping? and why is this fall a good thing? especially for the automakers. stay with us for the answer.

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recruiter and now you can use zip recruiter for free at a special site for tv viewers; go to ziprecruiter.com/offer2. low gas prices have been great for auto sales good for trucks and suvs. can those strong sales continue this year? phil lebeau joins us now. what do you think? >> i think they will continue. i think what we're seeing right now is the pent up demand is still driving a lot of the sales that are out there. and for a lot of people look americans love large vehicles. they love suvs. they love crossovers. there's never been a greater selection of those vehicles. lower gas prices is just a further incentive when they're out there looking to say i can

buy that suv as opposed to saying maybe i'll get a crossover even though i want more space. >> you know what's interesting, as we look through the stocks that did so well over the course of the fourth quarter, we know the automakers are very much in focus. phil, one of the things i notice is you've got the dealerships doing well. and the autoparts retailers, not the makers but like the autozones, o'reillys. it's not just about new car sales, right? >> no. in fact, you could argue that the new car automakers they really have not enjoyed this benefit of the sales that we've seen for the autodealers as well as those retailers when it comes to the autozones, o'reilly automotive whatever it might be. because there's still a huge volume of old vehicles. i'm talking about 16-year-old vehicles, 14-year-old vehicles. there's a huge number of those that are still out there and a lot of people who still want to fix those vehicles. that's why they're still going into the pep boys the o'reilly

whatever it might be. at the same time when you look at the aweuto dealers, they're benefitting because so many are saying i'm done with this old vehicle, i want something new. and people in particular are looking to lease right now. that's why this is a great time for the auto dealers. >> within that sphere within that whether it's the auto dealers, the stocks themselves which ones are going to outperform. which ones might lag this year? >> i think it's going to be dealers who probably do the best.automakers are not likely to see a lot. but they're still being dogged by what's happening in europe. that's a market that's a mess. and it's unlikely to turn around any time soon even though there's some conflicting reports about when it starts to come back. when you look at the dealership group, here in the u.s. they're in prime position. you've got record transaction prices. you've got more people looking to buy or to lease.

and right now there's a strong market out there. if you're in the dealership space, you're likely going to see strong returns here at least for the next six to nine months. >> by car is ten years old and i still spend money to fix it up. >> see. there you go. >> that's just me. >> that's just you. thank you so much phil. okay. let's do something we do every single day but not normally at this time. we're just mixing things up. we have street talk with the stocks you need to know today. >> there weren't a lot of analyst calls out on this first day of the year. but first up you've got bed bath & beyond. >> that's right. upping to buy from hold. the price target as well was raised to $91 from $66. so quite a hike there due to rising sales. momentum sitting at $76 and change. it's been a bit of a lag. >> so this is a smaller company

but let's go to a big one. this is apple. reiterated at buy. >> you don't get much bigger than apple. >> no it's the biggest one out there. >> it is. the price target raised to $125 from $120. sitting now at about $109. this is thanks to higher estimates based on iphone 6 sales. >> i got one for christmas. >> did you really? >> mie wife got me one for christmas christmas. >> i you just using a samsung galaxy. >> s5 yes. i like one for personal and one for work. >> they're both big. >> they are. very large. >> deep pockets. so based on higher estimates of iphone 6 sales, 67.36 from a year ago. and also sees double digit growth. for 2015 and 2016. >> so the trend continues. shocking.

all right. so let's talk about tidewater. a buy rating. >> this is interesting because they maintain it as a buy but they also cut the price tag to $53.62. there is a catch here. they cut the 2015 and 2016 earning estimates after the recent oil price casualty of oil and gas. >> down 45%. >> so oil and gas, moving to pharmaceuticals. >> the price tag was raised so it's hiked to $71 from $34. >> the upgrade takes into account strong showers of therapies and successful ipo of a competitor. and also what they say is doctor enthusiasm for more immune based and personalized

therapies. >> let's stay on that theme here. our under the radar stock today laboratory corp. of america. >> it rolls off the tongue to say lab corp. it's an out-perform. it was raised from market perform with a $130 price target. the stock has had a bullish run, though, due to a lot of focus on product innovation. share buybacks better than expected in the third quarter. >> up 23%. >> that's right. >> not too shabby. >> in case you missed it at the top of the hour we just learned that the obama administration is imposing new sanctions on north korea to respond to the hack on sony pictures. so we're about to talk to a former fbi special agent all about this and whether or not these sanctions will work. stay with us. l your important legal matters in just minutes. now it's quicker and easier for you to start your business, protect your family, and launch your dreams. at legalzoom.com we put the law on your side.

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getting back to the breaking news from the top of this hour, the obama administration has just announced a new series of sanctions against north korea. the white house says the new sanctions will target the hacking experts inside the north korean military. joining us now on the phone is jeff lanza, former fbi special

agent. thank you for joining us. what i'm hearing here is the sanctions have named three entities as well as ten north korean government officials including individuals working in iran, syria, china, russia namibia. how will these sanctions work and what exactly will it achieve? >> well, i think obama said from the beginning there's going to be consequences if they can tie the hack to north korea. and so this is the follow through on that. the fbi -- this is happening as you say and the news reports are indicating, then the fbi is pretty darn sure that north korea is responsible for the hacking. so the consequences, the sanctions are designed as a follow through for what obama said. >> how did they zero in on these particular individuals? what did these particular individuals as far as we know do? >> well, we don't know yet. this is such new news we don't really know. words should come from the administration or the fbi. how they were tied into this

specifically. but there's got to be really strong evidence for this to have sanctions like this. what their responsibility is and how they figured that out, we don't know that right now. >> you're right. we don't have a lot of details. but how do you think based on maybe previous experience with this kind of thing when you single out these individuals and say we're going to sanction them, what does it mean? does it mean blocking off bank accounts? how do they sanction individualings? >> it could be a lot of things. it could be monetary sanctions, trade sanctions for the country as a whole. there's a lot of things that they can do. but, you know we don't know what they are yet. but it's interesting that this announcement was made and they came to this conclusion to tie it specifically to the individuals is quite amazing at this point. that points they must have -- besides computer evidence maybe some sort of intelligence

evidence, the human intelligence that's giving them clues as to who was behind these hacks. >> we've learned so many times time and time again that north korea is not the kind of regime to say you sanctioned us we give up, we'll play nice. how do you think they're going to retaliate to this retaliation? >> the thing is, these type of things generally involved escalation. so one person does something and then there's retaliation. and there's retaliation on the other side. and sometimes diplomacy might be a better way to go. when you retaliate as a way to impose consequences for an action, sometimes that results in further escalation of the actions to begin with. this could lead to more activity on the part of north korea. >> indeed it could. tit for tat. we'll have to see what happens. thank you very much for being able to comment on what we know so far. thank you. >> you're welcome. ceos in the hot seat. mary thompson and herb green burger about to make their

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the ceos of some big-name companies might not still have those jobs a year from now. mary thompson joins us now with a list of ceos who are let's just say under a bit of pressure starting the new year. >> that's right. they'll certainly be under a microscope with strategies aimed at reinvigorating their brands and hopefully quieting their critics. first up twitter's dick costolo. he's banking on a plan that calls for strengthening twitter's core audience making twitter easier to use and introducing new services to attract new customers to help reverse the stock's 47% decline in 2014. a new year will bring a new menu for mcdonald's. in a lot of ways don thompson is under the most pressure because any results from that new menu will be evident in the firm's

monthly sales. yahoo! stock up over two years but critics don't care. they credit the gains to yahoo!'s stake in alibaba not to marissa mayer's leadership. mayer is planning to shift it but will kbha will she do with the rest of the money? coke stock delivered flat returns on flat sales and weak profits in 2014. so muhtar kent is looking to add some fizz to the biz. analysts question whether kent's plan is to come back with the slowing growth in the core soft drink business and if he can do it fast enough. lastly ginni rometty freed her and ibm up to focus on her plan to reinvigorate 2014's worst performing dow component. this is the turnaround story

that will certainly take i think longer than a quarter, two quarters, maybe even a year or so. but investors will be watching. back to you. >> oh, yeah. you can bet that. thank you very much. quite a list. really big names on it as well. let's bring in another big name. mr. herb greenberg. great to see you. >> happen. i to see you mandy and dom. >> dom will be back in just a second, but herb on that list that mary just gave us do you think there are any of those names that are going to have a whole lot more time golfing at the end of this year or running a company? ie, will they not be there anymore? >> i think the biggest one at risk is don thompson at mcdonald's. but i don't necessarily think that he -- it's his fault. in other words i think anyone could have take then job at mcdonald's when he did and probably faced a similar challenge. it's unclear whether anyone could have done any better.

plenty of people will perhaps disagree with me on that but i think he's in the hot seat for something he inherited which is the case of each and every one of those you look at. now, i think muhtar kent at coke is in an interesting position. he again inherited something he couldn't -- it's not his fault that the soda business in general went flat. but he's going -- it's going to be interesting to see what happens with say, green mountain and his investment in green mountain to see whether their cold product due out this year performs in line with expectations. that shows he's been trying to take the company in another direction and whether that really is going to work. so i think actually he's more in the hot seat than ginni rometty. many people think she should go. but she inherited a very difficult situation. and i give her credit for having the guts to do away with the company's so-called 2015 road map for earnings per share.

so they all have their challenges but i think because thompson is just right front and center for some reason he's probably the most at risk not to be there whether he decides on his own or the board decides they need to just for the stock's sake even though the stock has held in to do something. >> i would agree with herb in that. so the results you can see immediately as i pointed out earlier and the problem is is herb also said is that both he and muhtar kent are dealing with changing consumers' tastes. i think that also makes them more vulnerable. if you look at retailing ceos who haven't turned their brand quick enough to deal with changing consumers' tastes a number of them lost their jobs as well. so again people are looking for the fastest results from mr. thompson in large part because you can see those results for quickly. and changes to strategy or menu something like that. rometty, i agree.

longer term play there. people are not expecting her to turn around a company the size of ibm in six months or a year. they will give her time to make those changes that she's laid out. >> okay. thank you very much to herb and to mary. herb, i think you might be coming back in just a second. because there are some ceos who seem to have some momentum at their backs. two of them might be the chiefs of microsoft and intel. but can they both kick it up a further notch in 2015? herb, we'll bring you back to talk about that. josh lipton is going to join in as well. "street signs" continues. also when is slimming down bad news for weight watchers? when their share prices are losing heft. we're going to take a look at what's going on. why weight watchers' stock is getting hit hard today. that's just ahead.

intel was the darling of the dow in 2014 up more than 40%. can that type of run continue? josh lipton joins us with the intel story. hey, josh. >> well investors might not think of intel as an especially sexy company but the chip maker did deliver big results in 2014. that stock as you mentioned surging some 40%. it was the top performer on the

dow. so what happened? well, for one the pc market was basically flat. that's not great, but certainly better than a lot of people had expected. and that's good news for intel which dominates the pc chip business. that accounts for about 60% of its sales. craig ellis expects another relatively stable year in 2015. he says that's due in part from an improving labor market, they hire more workers, that means they buy more computers. the other big part of intel's business is providing chips for servers. that accounts about 20% of its sales. ellis says that business could generate another $7.5 billion in revenue over the next four years. what are some challenges, though, for intel in 2015? well they said the mobile business will lose money next year. no surprise after a strong run, some on the street are concerned about valuation at these levels. but here's another reason for potential optimism. carter werth says that technicals still look strong with intel on its way to 42.

so stay long be long says werth. mandy, back to you. >> josh, thank you for setting it up. let's bring back herb greenberg. we already talked about some ceos who haven't been doing is great or have an uphill battle ahead of them. what do you think of microsoft and intel in particular herb? >> well, first on intel, the interesting part on the story is it was going up against such easy comps. this company's growth was just so horrible. if you go back five six quarters and the company has come back. but interestingly enough its revenue last quarter $14.5 billion is just a little above where it was in october of 2011. so you can see it's sort of still flat and the interesting part there would be whether it can really accelerate. i think the real story continues to be microsoft. i think nadella is new energy into the company that is a way that will be interesting. i'm having to now look at

microsoft as a user in a way i haven't done before. they may actually have me in there because as i go through the product lines and product categories, i'm finding that they actually have things i may need for my company. may need for my company. >> like what? what in the lineup that would suit your needs? >> i'm looking at -- okay. i'm looking at sharepoint versus dropbox, a collaboration and sharing tool an i look at that and pricing of that versus -- i look at the pricing of that and consider the actual capabilities of those programs to be better than dropbox on a price per user basis. even versus google. i may need to use word. so google dox is out for me. i look around and i'm saying it is interesting. but here's the catch as an mac user. >> the catch. >> let me tell you what it is. three of the four me believes of my company are mac users and all waiting to see office for mac, the version everybody's waiting for.

is microsoft going to continue to treat office for mac as a bastard stepchild or will they come out with something that's swinging? and that's going to be important. i bet cha under nadella they do. >> that's the test. josh, is that what you're hearing, as well? >> you broke up there. >> herb is saying the real test of the office for mac users. herb, you put it to stop treating mac users at step children. is that what you said? >> bastard step children. >> oh, ouch. okay. yeah. i wouldn't have put it that way but point taken. >> listen. i think that the excitement, there's there's clearly been tremendous for nadella. i think you are seeing benefit there like the intel stories, stabilization in pc and the real excitement for microsoft investors is the way he's aggressively skating towards those growth areas, whether that's mobile. there's a large opportunity

there. windows share and smartphone market is like 3% and, of course the cloud and scaling very quickly, mandy. >> and i would agree with that. when you look at it there's confusion. you have office 365, one drive. you have sharepoint. you have a lot there and confusing when you try to understand the product lines but i agree with josh and i think i agree and the marketplace agrees and whether they hold it and grow from it. >> you are so cool herb. so much more tech savvy than i am. i'm not really that generation to be tech savvy. i kind of just missed out. josh and herb thank you very much for joining us. okay. take a look at this weight to loss chart. it's a live look at how much weight weight watchers are losing right now. tanking by 12%. that's coming up next. but i'm a bit skeptical of sure things. why's that? look what daddy's got...

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so ally bank really has no hidden fees on savings accounts? that's right. it's just that i'm worried about you know "hidden things..." ok, why's that? no hidden fees from the bank where no branches equals great rates. for many a new year comes with a new resolution to lose weight so that would mean stocks like weight watchers get a boost this time of year. however, the stock, trading sharply lower today. down by 12%. what is going on with wtw? we have a guest that covers weight watchers. what do you think is going on? >> yeah. there isn't any company specific news today and what my best guess is the company is taking a bearish bet on the company.

company's repositioning the platform to be modern and that being said i think the recruitment side of the requags and whether or not consumers are willing to pay up for weight loss management programs that's an a big question and maybe what dragging down the stock today. >> not just today, r.j. over 12 months it's feels as if they missed the boat on the revolution. >> i think even the ceo will admit that the company was slow in reacting to the competitive threats that noble devices offer. i think the company's done some innovative things whether it be allowing the platform to be into grated integrated for on-demand access to a weight coach and takes time for people to respond and what happened, too, introduction of mobile devices out there it's ees's

commoditized certain parts of the marketplace. >> r.j. this is not to say that this is the death knell for the stocks or maybe it is. tell us what you think the outlook is. can they adapt and a chance for this weight watchers or nutrisystem or the weight loss type stocks to dom back? >> you're right. i don't think it's a death knell for the companies and the idea that embracing mobile technologies is a way to satisfy and reach consumers any way they want to more touch points is a key point of differentiation. look at mobile devices can't get into. that's the b2b sides. i think that's the important point of distinction. weight watchers health solutions business i think is the most defensible part of the company and still retooling that platform and looking beyond 2015 into 2016 and beyond that i think is going to be the most meaningful part of that business. there's a tremendous amount of

demand from insurance companies for that partner to run the weight management programs and i think the company's done a good job on that end and taken time and they signed a partnership with humana and the key driver for a stock like this going forward. >> a partnership with companies like fitbit enough, r.j.? should they look at an acquisition of a company like that? >> yeah. i think it's a possibility and the way they're going about it is smart. they're not trying to build their own device to compete. what they're doing is setting up program to convert the activity that you're using with those machines and convert them into points and not trying to reinvent something and spend capital on something that's a low probability type success event there. i think they're going about it smart. i think the partnerships help not only do they get the brand out there and also probably the most capital efficient way of going about it. >> is there a time or point you think that these stocks do either seasonally or otherwise become attractive for investors,

not just retail but perhaps institution institutions, as well? >> typically you look towards the middle to the later half of the year for the better idea of the next year's recruitment program. a lot of times with these eight loss stocks it's all about recruitment early on in the year and so if there's concern about 2015 and even the company said it's a transitional year for them and concern heading into 2015. i think you start to look at the plans for 2015 and usually come out midway towards of the year and especially if you start to see more partnerships with like insurance companies and other employers like that or see other mobile partnerships. i think that's probably the key indication that it's safe to get into the names. probably about the right timing for it. >> so you're expecting positive revenue growth next year ie 2016. transitional year. thank you for joining us r.j. on weight watchers.

okay. take a look at the market. >> dow gotten back a lot of losses here. down about 20 right now. 25 right there. >> the saying as goes january and the year. today is just one day. >> it is. >> another saying, one day does not a trend make. thank you for joining us. >> absolutely. >> i'll also see you on "fast money" and options action from the nasdaq later on today. tgif everybody. welcome to "closing bell." i'm bill griffeth. hey, kayla. >> hey bill. i'm kayla tausche in for kelly evans. triple digit gain early on in the session evaporating after we got some nasty data out of factory orders and construction spnd spen