they didn't fall off. it's not extremely light volume so that's one reason that perhaps -- >> nice early move too from netflix from amazon facebook, even twitter. all of them moving positive when the s&p was negative. >> bring up the alibaba thing too because of the fact that everyone is focused on apple and amazon and some other names. you have a great rest of the day. power starts now. >> "halftime" is over. "power lunch" and the second half of the trading day start now. >> power lunch. key numbers on the state of the american housing market as we gear up for the key spring selling season. if spring ever comes, mandy. >> feels like it's not going to. okay. well ceos are cashing out. a big surge in insider selling going on right now. what is fueling it? should you also be getting out of some of these stocks? >> one stock that investors are getting into recently is target. that one up 35% in the past we're. >> the retail giant out with earnings.

targets chief financial officer. the cfo will be joining us in a power lunch exclusive to give us his financial forecast. we begin now with the health of the american house housing market, and new numbers on home sales as we begin to gear up for that spring selling season. fingers crossed it comes. you've got dr horton and toll. all moving to the down side. let's get to diana who is live in washington. hi diana. >> hi mandy. after a disappointing report on january sales of existing home sales of newly built homes out today a bit more heartening but you have to keep them in perspective. take a look. january sales came in at an annualized rate of 4,1,000. that's flat from december but december had seen a huge 11% monthly jump, and we didn't give any of that back. that's good. the 30-year average for new home sales is over $700,000 a we're. we still have a long way to go.

>> sales of new homes priced under $150,000 are one-third of what they were a year ago. that is why luxury home builder toll brothers is doing so very well beating the street in its quarterly earnings report where heed when asked on the analyst call that tried to push volume over price as some of the other builders are starting to do. the answer was pretty clear. bob toll said "that's not our game. great for toll but here's a bit of a scary stat. realtor.com looked at 200 local housing markets and about one-third of them had no newly built homes for sale that were considered affordable by the market's median income. zero none. tyler.

>> i have never seen this in -- i've heard fed chairs accused of being biassed towards capital. maybe against workers, but not being a democrat or republican and favoring one side. i want to play you just one of the exchanges that happened today with congressman milvaney. >> if you are sticking your nose in places that you have no business to be you have no business in the long-term labor markets. to the extent you claim to be wanting to help fix income inequality and wealth distribution in this nation, in the view of many of us you're actually making it worse. >> she was accused of favoring one of the parties because she

spoke about inequality two weeks before the election rsh here is tea party member sean duffy in exchange for the fed chair. >> was there one party that was pushing the whered of income inequality over the other party in the last election? >> was one party pushing that idea over the other party? >> i have heard politicians on both sides of the aisle la meant rising income inequality. >> had showed several documents there. scott, our congressman, here in inglewood cliffs covering this area saying she met more with the white house or white house officials than she did with congressmen. sfwroo i thought that part of the fed's mandate was to pay attention to the labor market. >> you would think so and inequality, and, by the way, there's been a long tradition, tyler, of fed chairs or

chairman -- >> before she. >> talking about broader economic issues whether or not they're within the direct perview of the federal reserve. look, i think from a market standpoint what matters is whether or not they've weakened the fed chair. whether or not there's going to be any movement. i don't think so. i think this probably stops in the house and doesn't go any further and the senate. we didn't hear this kind of strong questioning yesterday in the senate. >> steve, thank you very much. steve liesman reporting. let's go to sue herrera and breaking news. five-year notes up for auction. hi, sue. >> hi, ty. as a matter of fact, it was $35 billion in five-year notes. the yield came in at 1.480%. the bid to cover ratio was a little light. that's the measure of demand for the issue. it came in at 2.54%. the bid to cover the prior ten auctions is 2.66%. it is a little below that. indirect bids normally the average is about 53.3%.

this one came in higher. 60.1% on indirect bids. we'll watch interest rates for you post-auction. back to you. >> indeed we will. thank you for that sue. the markets are gradually edging higher now. consumer discretionary stocks are taking the lead while utilities and techs are at the bottom. let's bring in don, investment strategist and economist at lpl financial and mark tipper, strategic wealth partners. mark. i look here in the united states. the markets are sitting around record highs. i look across the atlantic. you have a number of markets there at record highs. how do we get that next leg higher? what's going to be the catalyst? >> it's going to be tough. when you look at u.s. stocks in general right now, you know we're very cautious over the course of the next three to six months. much more constructive over the next six to 12. i think the next catalyst is really just -- money is going to continue to chase yield. there's a complete lack of investment alternatives right now. you know unfortunately,

valuations right now as they stand are at some pretty high levels with u.s. stocks and i know valuations don't matter until they actually do but, you know, it really becomes an issue of what could potentially cause investors to balk at these current valuations that pull the markets back. >> right. >> when you say, mark just to jump in there, when you say you are cautious over the next three to six months are you suggesting that we will get a pullback of some size before we sort of take a bit of a breather, digest, and then get the next leg higher, as you say, over the next 12 months. >> over the near-term down side risks are definitely elevated. we haven't seen a 10% top to bottom correction since october of 2011. i mean this is the third longest market rally in the history of the stock market. the second longest rally ended october of 2007, and we all know what happened after that. >> yeah. >> we're long overdue for a pullback. i don't know that we're necessarily going to get one, but we are cautious right now. there's a lot of potential issues that could cause a pullback in the near term but, again, over the next 12 months

we are constructive. >> hey, john you must be happy today because consumer discretionary is something you like very much, and it's the leader right now on cheaper gas prices. you look it i believe. just going between here and what's happening in europe for two seconds. why do you not like europe even though you say the valuations are more attractive? >> well europe is definitely stopped getting worse. something can't get better until it stops getting worse. then the last six months europe has definitely stopped getting worse. the ecb has done what it needed to do. you're seeing some of the financial transmission mechanism in europe improve. you're seeing some of the economic data be very lowered expectations. >> you are staying right here domestically at home. apart from consumer discretionary, john, what else do you like? >> we like tech. s we like industrials.

we're in a pro-cyclical area. we think we're still in the middle stages of the economic cycle. maybe in the second half of the cycle rather than in the first half of the cycle, and then definitely in the second half of the cycle, the market favors growth stocks over value stocks. since rates started to move back up, that's been more the market that we expect over the rest of the year. >> okay. well, we'll wait and see. yellin has been dovish so far. thank you very much to both of you for joining us. also energy exposure is something that we're keeping a very close eye on. for more on mark and john as's energy outlook and their plays, go to power lunch.cnbc.com. ty. >> mandy, winter storm reemas is about to wreak havoc kroots the south. perhaps appropriately enough there. a wintry mix of cold snow and ice is forecast but much of the gulf coast and even up into virginia and d.c. here's greg postel and the

weather channel with the details. >> big winter storms will move through the south during the early afternoon hours. lots of snow in mississippi northern alabama, and north georgia. atlanta on the edge. i think the heavy snow really targets central north carolina overnight tonight. watch out raleigh durham charlotte, and even greensboro and then getting on into virginia as well overnight hours. looks like heavy snoi is going to be moving into incorporates of southern virginia and norfolk, maybe even d.c. guys. this is a winter storm that is going from the south all the way up through parts of the middle atlantic and northeast. how much are we going to get? a look at some of the numbers. we have five to eight in eastern arkansas. the biggest snow in north georgia will be in the mountains there just south of chattanooga, and then as you head towards north carolina, look at how much we got here for the central piedmont there near the raleigh durham area. perhaps 8 to 12 inches there, and then maybe, maybe, in d.c. one to three. largely staying south of say, trenton, new jersey and certainly new york city. back to you.

>> thank you. the bankrupt billionaire, the judge, and the porsche. chief international correspondent michelle caruso cabrera with more on the very bizarre story. it sounds like some kind of, like, i don't know, soap opera. stroo yes. >> flamboyant former brazilian billionaire batista lost $34 billion in a year. now he is on trial, and his judge is driving one of his very expensive cars. >> oh. that's not fair. sfroo how does that happen? we'll explain next on "power lunch." hey, girl. is it crazy that your soccer trophy is talking to you right now? it kinda is. it's as crazy as you not rolling over your old 401k. cue the horns... just harness the confidence it took you to win me and call td ameritrade's rollover consultants. they'll help with the hassle by guiding you through the whole process step by step. and they'll even call your old provider. it's easy. even she could do it. whatever, janet. for all the confidence you need td ameritrade. you got this.

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>> shares of american express up 1.5%. the dow component says it's hiking interest rates for many of its credit cards following a year-long review process. the company spokeswoman says that rates of u.s. consumer cars, many of which currently enjoy below market rates, will see some changes with this new move to the up side. mandy, back over to you. >> thank you very much dom. well tjx, the parent company of marshall's and home goods, boosting pay for its u.s. workers to $9 an hour. the move mirrors wal-mart's recent decision to increase its hourly wages. apple, ordered pay more than $530 million in a patent trial involving its itunes software. apple plans to appeal and target beating its earnings estimates despite taking a big financial hit from pulling out of canada. chief financial officer will be joining us at a power lunch exclusive to discuss the

retailer's outlook, and that folks, will be in about 20 minutes time. >> all right. he was once brazil's richest person by far, but his life has taken a complete u-turn. batista on trial for insider traced over the financial meltdown of his oil company. the judge now facing heat in this case as well. you two get to follow some weird stuff. >> weird stuff happens overseas doesn't it? >> a brazilian newspaper, take a look at this has published photos showing the judge in the trial of former oil billionaire ike batista driving batista's porsche suv. the car was seized by authorities earlier this month to keep batista from selling or giving away his pricey assets. here is the front page of the newspaper "extra." that's judge flavio behind the wheel of the porsche cayenne that can cost anywhere from $65,000 to $100,000. a newspaper called -- managed speak with the judge who told them "the federal police did not have a safe place for the

car. it was exposed to sun, rain possible damage. as i want the car to be as preserved in good condition, i took it to a covered space. i did not take it to use. just to look after it. it is a normal situation." the car is one of nearly a dozen cars seized earlier this month on fears that batista was dumping his assets. the judge chose not to safeguard this lomborghini. >> did he drive it around the house? >> i think he had an elevator that he could put it into. don't quote me on that. he is accused of selling stock in his company when he learned that his oil rigs weren't finding as much oil as he thought they were going to find. his net worth declined more than $30 billion in one year as his company went south. wow. ouch. you could make up a story like this, and people would say, no

it's too far-fetched. staying with brazil because the shares of petrolbras is down. >> brazil on its own could be facing recession because they have so many issues but the situation with petrobras very significant because it's state-owned by the government. moody's cut them to junk and says it's on stand-by in fact to do it again. the reason is the massive corruption scandal engulfing the company which means that petrobras still hasn't published audited financial from the last quarter. here's why. it appears a huge percentage of the deals that this company did were padded with kickbacks. that means many of the assets on the books, likely overstated at a higher valuation than they actually deserved. we still don't know by how much. if the company doesn't report earnings by april 30th they trigger what they call covenanted. think of them as clauses in the company's debts, which would put them in technical defaults and could force them to make massive debt payments. this is a process known as

acceleration in the bond world. it's significant because this company has more debt than some countries. $170 billion worth. important to know here. both petrobras and ike batista have nearly the same business model. they borrowed a boatload of money, and they said don't worry, we're about to pay it all back. we're going to find all this oil, and they didn't find that much oil. this is long before the price of oil declined et cetera. >> is the company going to collapse? sfroo wow. that is a good question. the state owns the majority of the shares right? i have said i think the shares could go to zero. people say no no the government will pour more money into it. they just don't know how big the hole is. they could start to face political constraints. i mean, if moody's is worried about the debt what should you think about the publicly traded stock? >> right. >> the stock gets hammered, and brazil rules are a little bit different so you might have a little more protection, but generally speaking it's very very bad. >> i believe that brazil has absolutely no plans at least currently to pour more capital in. we'll just have to wait and see. thank you so much michelle.

thank you. plus -- >> coming up a power pitch pick me up. this start-up recharges your brain with a drink that should help you think. >> an on-line drink brand using nir row tech to disrupt the $40 billion energy drink market. >> will it quench this panel's thirst? >> how are you tracking and communicating outcomes? >> how do you reconcile that with a product that's in a mysterious bag? >> or leave a bad taste in their mouth? stay tuned to find out. ...corrects for lane drifting... ...and if necessary, it will even brake all by itself. it is a luxury suv engineered to get you there and back safely. for tomorrow is another fight.

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i'm actually a dj. [ dance music plays ] woman: [laughs] no way! that really is you? if they're not a cfp pro you just don't know. cfp -- work with the highest standard. >> to defense a panel of experts that his start-up is the next big things. >> it's an on-line drink brand using neurotech -- by providing direct focus as an alternative to alertness. let's say you didn't get the best sleep last night. you have a lot of work to do. you know the options. coffee and energy drinks. those options help you stay alert. from our research we found that it's not being alert that helps you be more productive and efficient. it's clear balanced focus. sounds great, but why do we think we have the answer? because we can see the difference in the brain waves. our ucla neuroscience team quantifies attention using

wearable tech, and we formulated our drinks based on the biology of focus. we use active -- which are widely used in europe. we shipped over 10,000 boxes to members in over 50 countries. our on-line partners include urban daddy, ah ha life and stack commerce. we're backed by the start engine accelerator fund and currently raising around $500,000. with true brain our members are getting their work done faster and getting out of the office sooner. >> and welcome to today's power pitch. i'm mandy drury. you just saw chris thompson's pitch. now let's meet the panel. on set with us here is nikhil partner at vast ventures. that's an early stage ven fewer fund which invests in consumer start-ups. his portfolio includes somo water, the first sustainable water filter. also with us is alicia founder and ceo of pantegrion capital group. she's also a board member of new york angels. joining us from san francisco is rebecca kaden, a principal of maveron, a venture capital firm.

the group's investments include ebay and groupon. great to have you all with us today. chris, are you in the hot seat. would you like to throw out the first question? >> with the massive global consumer trend towards eating whole foods, eating organic foods, how do you reconcile that with a product that's in a mist ear where yous bag? >> it is -- it's an 80% natural with these ingredients, but it's not just the healthier alternative to energy drinks. it's a better performing, you know version of that same idea where you can actually get that true direct focus as opposed to just alertness. >> chris, i saw that you're planning on publishing studies on brain wave data and your product in top journals like the new england journal of medicine. how soon could we xwp to see that information come out? >> we've done two studies underway. very exciting results. it is a process, so i'm not going to promise when we're going to get there. that's part of where some of the funds are going to that validation. >> how are you track and

communicating outcomes of drinking your drink? >> we don't want to make these bold outrageous claims but for now it's you know nutropics is gaining in popularity and with our active neutropics. we'll be behind on being able to claim exactly what it is. >> has anyone ever come back to you and said you know i tried your product, but it really didn't work for me? >> there's always a bell curve of response. there will be a slice that it doesn't actually work for them or it doesn't do anything noticeable but for the vast majority, there will be something. >> like if i were using wearable tech, what are those two or three big data points that you would look at? >> our ucla trained neuroscience team, that's the group that's working with us. we're all together in this to try to quantify exactly what attention looks like. you have brain wave ratios in each sphere of the brain, each loeb. if you look at the frontal lobe you have morale fa brain waves. that means you have better control over your executive function, which means i can determine what i'm focussing on and what i should block out. >> how does the customer experience work? do your consumers feel the

impact after one drink or does it take more chances to feel the results? >> it's a bit like a juice cleanse. you do have to be a little bit patient. it's part of a routine and a regimen where it takes a little bit. it takes, say, three, five sech days of consistent use for you to actually start to realize the focus benefits. >> how long does a box last for? >> it's a monthly subscription. there's 30 50shgs or 60 drinks. >> it works out to approximately how much per one of these? >> it's less than a starbucks coffee. we're not trying to replace coffee, but it's something that can work well with caffeine. >> okay. well, we all heard what chris had to say. now we need to know if the panel is in or out. >> i think there's a few core challenges. the product takes a long time for it to work. i think that it's a little misleading on what's actually inside it. however, what it does have is an unbelievable rapid following and great distribution already. for that i'm in. >> what about you, alicia? >> i have been on the product myself for the past few days

and i haven't really seen results yet, but with that said i think that there's a huge opportunity with brain health. i think their business metrics look really good so far, and tear willing to hold themselves accountable by measuring results so, i'm in. >> what about you, reb kwa? >> i think you're at the heart of some big trends around health food and beverage impacting our mind and body. i'm concerned about stickiness here. especially on a product with the delayed wrout comes and the price point you are focused on. i'm out. >> we have two ins. you have one out. what do you think? >> well i really appreciate the feedback. i know the consumer companies that you guys are involved with that you back you really understand the space, so appreciate all that feedback and it's something where we're first to market here and we have to continue to build and grow this. >> okay. well, good luck. we'll be watching. >> thank you very much to chris of true brain, and also to our panel. that is today's power pitch. >> and what about you, viewers and listeners? are you in or out on true brain? you can tweet us using the

_#power pitch, and let us know what you think. for more on power pitch, visit power lunch.cnbc.com. by the way, ty i've got another power pitch update for you. i love these. they're always really positive stories. back in early november south worth, he pitched his alcohol delivery start-up called thirsty and since appearing on cnbc the mobile app that allows users to order booze, has expanded a total of nine u.s. cities. it's also raised $1 million in funding. and they tell us sales are now up 32%. i'm pretty sure they're going to be drinking to that. ty. >> all right, mandy. southwest shares taking a bit of a hit this hour. low cost carrier grounding more than 100 planes because they missed inspections. ceos cashing out a surge in insider selling going on right now. we'll look into it and tell you what is fueling it when we return.

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♪ ♪ meet chris jackie joe. minor damage or major disaster, when you need us most, we're there. state farm. we're a force of nature, too. ♪ ♪ israeli prime minister benjamin netanyahu says world powers have given up from stopping iran from developing nuclear weapons. the comment came as mr. netanyahu plans to address congress on the nuclear

negotiations. an injury risk has prompted costco to recall hundreds of thousands of convertible hand trucks. the wheel hud can separate or break and inject pieces. a majority of supreme court justices signalled support for a muslim woman who filed a lawsuit against abercrombie & fitch after she was denied a job at the retailer because she wore a head scarf for religious reasons. a decision is due from the justices by the end of june. >> astronauts terry and barry are floating outside the international space station for a planned six and a half hour space walk. their mission is to install a series of power and data cables that will allow future dockings by american crew capsules. you're up-to-date. that's your cnbc news update at this hour. back to you, ty. >> thank you very much. dominik chew now, market flash. >> let's talk alt bit about what's happening here with beer. boston beer the maker of sam adams and sam adams light, coming off of its lows of the day, but still the worst performer in the s&p midcap 400. down about 10%. you can see now 11% on the day.

this after the company's 2015 profit projection fell short of some analyst expectations. fourth quarter sales also fell short. though the company did score a three cent beat on its fourth quarter profits. tyler, back to you. >> we'll have to do something about that. both of us here to try to help them out. >> mandy being there, mandy is all in. gold prices closing right now. take a look at it. up $4. $12.01. take a look at silver copper platinum, greens. there against all of them. about 1.5% for silver. about 2% for puladium and half a percent for copper. platinum up .4%. >> two big cnbc pro stories to tell you about today. dominik chew is looking at a surge in insider selling and bob reporting on the best bond etf debut ever. bob, you're first. i bet mr. gunblatt is smiling again. >> he has entered the etf

business. wow. husband dibble line total return exchange traded fund that's a mouthful, at a respectful debut. traded 600,000 shares. now, this is an active managed bond etf. with bonds picked by gunlock's team. it's going to consist mostly of investment grade debt and various flavors of mortgage-backed securities. it could also include corporate high yield debt and potentially even some emerging market debt. this is active management remember. gunlock can change the investment mix whenever his team decides. as for competitors, there aren't many. this is active management. it's a small part of the etf business. the big ka huna you see here pimco's total return it's got $2.5 billion under management. in a recent etf conference he has to say why he wanted get into the etf business. >> on whether it's right or not, the etf's will ultimately surpass new wal funds.

it seems like a reasonable category to get involved in. >> it's cheap, and it's not that cheap. the cost is 55 basis points a year. that's 0.55%. now, is that worth it? well, it kind of depends. can you get into the van garde total market etf, and you can hold the whole bond market for eight basis points. a fracture of that. the argument is that gunlock has a history of outperforming. he is going on his reputation. i would also note, by the way, this is using a different strategy than gunlock's total return fund. broader fixed income mandate. here they have a lot more places. high yield emerging markets, bank loans, whatever they want that they think will help them generate outflow. we'll see here whether or not this really creates some excitement in the whole new space in etf's of active management. jury is still out, but gunlock has a strong reputation. back to you. >> thank you very much. dom chew now, and the surge in insider selling. some really surprising numbers here. >> some investors do like to look towards whether ceos and

other executives are buying or selling their own stock as a way of gauging the sentiment of how they feel. do they want to stay in it. this is from the vickers insider for market research. they look at the numbers around insider buying and selling, and they found interesting at least themes over the near term. just over the past week about ten shares were sold by company insiders for every one share bought, and that's among nyse new york stock exchange listed stocks. now, what's even hor interesting, about four and a half shares were sold for every single one buy, and that's a rolling eight-week average. they roll it all together. there is a lot more insider selling than buying right now. that's the highest level since july of last year. what does all this mean? if you take a look at the s&p 500, the last time we reached these types of levels in july of 2014 we watched the s&p 500 pull back by about 9% on an enter day basis. you can see july over here and then the ultimate peak that we

saw later on towards october. a nice move lower here. now, that's not to say that insider buying and selling is the end all be all indicator, but it could be something that some investors are watching and tyler, for more on this story and bob's story, go to cnbc.com/pro. we've got a whole array of other topics to talk about. >> insider selling in and of itself does not mean necessarily -- >> no. >> they could be doing this for estate planning reasons. >> replan. >> correct. >> or to pay tacks or whatever. it is always interesting to know. >> it's one -- >> watch. >> thank you very much. >> developing story involving a possible terror threat in new york city that the hour. w nbc's jonathan dentsz has the details. >> three men were arrested for trying to travel to syria to join isis and they had talked to an informant and were recorded talking about wanting to target police officers in new york, fub

agents, even the president if they were unable to travel and join the terror group overseas. then perhaps they would try to do something here in new york. the fbi had to monitor the men, and when they first came upon them back last summer and the investigation has been ongoing, but the main thrust is that three men living in brooklyn were allegedly plotting to travel overseas to syria to join isis to join the terror group over there to join the fight there. they had met at a travel agency in brooklyn and discussed carrying out acts here in new york in case their travel plans fell through. they were arrested overnight and two of them will appear in federal court in brooklyn this afternoon. the third man is in florida and is expected to appear in court there. again, the possible targeting of sights here in new york aspirational, if you lshg the men did not have guns or bombs at this time but they did have

plane tickets. two of them did have plane tickets, planning to travel overseas to turkey and then travel into syria and that's when the fbi and nypd moved in made these arrests because they were concerned that they were about to travel and join isis overseas. as you know the fbi is concerned across every state of possible home grown terrorists being inspired by isis to join the terror group. now appears three men from brooklyn may have done exactly that. back to you. >> jonathan, thank you very much for the latest on that. well shares of southwest airlines today are moving to the down side. the carrier grounding 128 jets because of over due maintenance checks. phil lebeau keeping an eye on that story for us. phil is this something that southwest has imposed on themselves, or is someone imposing this on them? >> well let's be clear, mandy. the grounding of these planes which happened on tuesday because they missed routine scheduled inspections of rutters, that has essentially

been lifted, and most of those planes are flying again. the faa told southwest airlines look you can take these 128 planes. you can continue to fly them. slonksz they do their inspections within the next five days. poom are saying what's going here? they weren't inspected. should they be able to fly. this would be routine inspections. it doesn't mean the faa says it's okay to blow them off. they're set to happen within a certain time period, and when it doesn't happen within that time period, if the faa finds out about it they will tell you to ground your plane, and in this case the faa has told southwest airlines some of these planes most of these planes can go and continue flying, but you have to do these inspections within the next five days. again, take a look at shares of southwest. mandy, most of the groundings and the flight cancellations involving these 128 planes they happened on tuesday. most of the flights today are happening as scheduled. >> thank you very much. >> thanks very much. phil, let's get a check on the bond market and take a look at the five-year auction. taking a look there. you can see the two-year, the

three-year, and the five-year notes. the yields moving lower. the ten-year the wreeld of 1.97 and the 30 at 2.57. targets transformation. shares up more than 35% over the past we're. we've got an exclusive with target's cfo next on "power lunch." what does it mean to have an unlimited mileage warranty on a certified pre-owned mercedes-benz? what does it mean to drive as far as you want... for up to three years... and be covered? it means your odometer... is there to record... the memories. during the mercedes-benz

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beat analyst estimates. although sales did miss. it also lowered guidance, and it's still above some analyst expectations. analysts at stern ag says cvi isn't as sensitive as some previously thought. back to you. >> thank you. very nice. well target beating fourth quarter estimates today. shares are up more than 36% over the past year. courtney reagan is here. courtney got an exclusive interview with the cfo. >> i sure do. john, thank you so much for joining us. you know the first question i have to ask you, of course is that on the media k5u8 you said you were surprised by the strength that you saw the back end of swran. first of all, why were you surprised, and second of all, where did the strength come from? >> yeah. i think, you know in the middle of january we said we thought a 3% comp for the fourth quarter ended up today reporting a 3.8% comp, which was a pleasant surprise for us.

we have way great discount on discounts of black friday holiday, and all of those gift cards come back into the store in january. really bringing all that sales back in january. we think the stores did a phenomenal job bouncing back from a busy fourth quarter or holiday season and then bouncing back getting ready with new product, having all that ready when people came back into the store. people look to start the new year in a healthy way. >> one of the initiatives you had was free shipping for all orders. no threshold on-line. what was the cost target? as we think about this we thought about the free shipping and fourth quarter. one of the best investments we can make.

as we look at guest behavior, when we look ate guest who shops our stores routinely, if we can convert them and get them to shop own line automatically we get more saelz because they're shopping on-line. >> that cost seems to be well worth the payoff is what you are trying to say there. as far as the port situation goes. certainly there has been a slowdown. we know there's a tentative agreement in place, but what can investors and target consumers expect to see at target as a result. >> we're pleased there's an agreement, and we're happy they're operating at full capacity again. i think we're really proud of the work our teams did. this has been ongoing for several months. our teams did a fantastic job over the fourth quarter in mitigating the slowdowns.

you can see it didn't have a material impact on our business. it was reported through the 3a comp. now there are some places in the store where we're light on inventory, but as we see the port situation continue to improve, we expect that to resolve itself relatively quickly here. >> wal-mart and tjx are two companies recently that have made some announcements and initiatives when it comes to training programs. will target do the same? >> you know it's a great question. i think we've always considered our store teams a real point of differentiation for us and talk about and are committed to having the best team in retail. we think we have that. we want to have that going forward. we pay federal minimum wages. i think the other piece of that that comes with the competition is training and development, like you mentioned, courtney and there we're very -- 60% of our team leads started in target

as hourly employees, so they've been developed and grown and now they're leading our hourly team members. we are very committed to that. as it relates to you know the recent announcements, we don't think that those will have a material impact on us. it certainly hasn't changed our view of either the quarter or the year. it's just part of our normal course to evaluate wages. >> and looking forward as a final question i understand that you and mr. cordel will be in new york to address investors next week. what can we look forward to hearing about next week that we have not heard about today on the various earnings calls? >> you know we're really excited to come next week. casey carl ahead of strategy innovation and jess jones head of marketing. really this is our opportunity to tell the whole story to the financial community and the media. here's where we're going. brian has outlined our growth initiatives centered around accelerate and having industry and digital growth. our focus on category signature

categories, style, home kids babies. our guests have said these are the categories we expect you to deliver. localization and personalization. then building smaller formats for urban locations. then, you know of course the first fiflt plank areas managing cost to invest in all of that. so we'll talk a lot about that and paint the picture of a much more fully about how we intend to deliver that and what it means over the long-term for our financials. >> thank you so much mr. mulligan. we will be there at that investment, and i want to mention as you are ending the interview with us that target shares have hit an intraday high. back to you. >> thank you very much. we should point out speaking of highs, the dow and s&p at all-time highs very recently here today, and the nasdaq very close to a session high and within really just sort of shouting distance of 5,000 and its all-time high set so many years ago. third largest global crop. it is nonallergic, non-gmo. it is shown to be as effective

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>> welcome back to power lunch. lumber liquidators is off today, and it's still just a hair off of its lows today. you can see there down by 19%. the company revealed on its fourth quarter earnings conference call, it's going to be the subject of a negative profile on an upcoming episode of cbs's "60 minutes." additionally, the company also said in an s.e.c. filing that a may face department of justice criminal charges under something called the lacy act chshgs bans trade which violates u.s. laws and plants and wildlife. to it it off, they fell short of expectations, fourth quarter profs and sales. >> thank you. this could be the worst possible alarm clock. look at that. early tuesday morning residents in the south new jersey neighborhood woke up to an explosion. it was felt township a mile away. this is a police dash cam capturing the house blowing up and there looking at some aerial video of where the home used to stand. it's now just a smoking pile of debris. about 15 fireworkers and gas workers were injured in the

blast. gas leak may have been the culprit, but the cause continues to be investigated. mandy. >> is rice the new meat? it's a question that our jane wells has been investigating. jane. >> mandy, one of the hottest diet trends is to add protein, but a lot of people don't want to add meat so look at this guy. he is adding protein with the most unusually product. we're going to meet him and the ceo behind the company making it. yes, let's just watch. as the power of protein lunch continues. hey mom, you want to live by the lake,

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>> we are continuing our march towards naxz 5,000. the latest on the markets move ahead. plus, is apple's big run setting up some big opportunities in other stocks? your guest says yep. we'll name some names. why something that is happening in the commodity market could mean good news for one group of stocks and can black bear make a comeback by going back in time? melissa lee joining us at the top of the hour. for now send it back over to tyler and mandy. >> right. thank you very much. rice, it's what for dinner. jane wells joins us now to explain. hi, jane. >> hey, guys. america is on a nutrition and diet craze. paleo, vegan, cut the carbs out, gmo-free, and one of the world's largest crops happens to check

all those boxes. >> darren personifies everything in modern fitness. he does crossfit eats paleo, but without the meat. instead for muscle recovery and protein he has turned to alternatives like rice. rice is the new meat? >> i feel better. my body feels better. my recovery is exactly the same. >> this is rice and pea? >> rice and pea protein. >> the ceo of axiom, the largest producer of plant-based freens in the u.s. cashing in on america's hunger for more protein in our diet. the bbc estimates animal-based whey protein will be a $12 billion global market in two years, and axiom wants to carve out a niche. snoo is this for expensive? >> it's less expensive, and it's also hypoallergic and

gluten-free and vegan. >> axiom's rice protein sells everywhere from whole foods to small stores like the vitamin barn in malibu. nutribiotics has been use it and rice profine products are now its fastest growing line. >> the organic sales since 2011 have increased 204% and actually last year the sales increased 72%. >> rice protein doesn't cost that much because axiom uses unsellable broken bits of rice as source material. annual sales are estimated at $100 million. with a study in the nutrition jushl showing no difference in muscle recovery between using whe wr and rice protein, the market is expanding from the health food crowd to the health club crowd. >> privately held axirm foods it is it's in talks with general mills and kellogg by adding rice protein. kellogg says it has nothing to add to the story, and general mills says for competitive reasons, it doesn't discuss future product plans. by the way on cnbc.com right

now, i do a taste test. guys, back to you. >> how was it jane? taste all right? >> yeah it did. it's a little chalky but you really can't taste it at all. it was mixed in with -- it was good. >> that's it for the first hour of "power lunch." >> indeed. >> thank you very much for watching. brian, take away the second half of the show. >> will do mandy and tyler. thank you very much. >> it's 2:00 on wall street, and welcome to the second hour of power lunch. i'm brian sullivan. the dow right now is up just a bit, but the story is the nasdaq composite -- the nasdaq continuing its march back to 5,000. oil is back above 50, and we have an apple stat that may just blow your mind. right now the big story is actually at the nasdaq which is where melissa lee is. >> it is shocking. we'll goat that in just a moment. atake a look rat where the nasdaq stands right now. we're up just fractionally. a little on hold as yellin continues today. we have the nasdaq up by a quarter of a percent. take a look at what's pushing the index higher into the session. facebook and yahoo making very

nice moves. it is also worth noting that along with yahoo, we're seeing a nice move higher in shales of aliba barry alvarez, and also first solar continuing its big gains from yesterday after announcing a proposed joint venture in yield ko was sun power's first solar continuing its power higher into today's session. up by 7.25%. this is not a new high in the stock, but it is a nice move towards that high previously, which is $75 a share. we're seeing that move nicely. in terms of that stat brian, you know what that stat is. i'm going to mention it now. a lot of people out there are invested in the nasdaq through the cues. thanks so apple. which is actually pulling back in today's session. thanks to am. we have these gains. >> if you and mandy ran an elevator and i joined it would i more than double the weight of elevator. >> you are like apple. >> i'm like apple, except more

delicious. let's kick things off for today's food for investing thought here. food stocks have been hot. look at these six-month returns. hershey, campbell smuckers, kraft, tree house doing better than the dow jones industrial average. perhaps as i wrote in my new ideas column on cnbc pro this week this is basically because the ingredient commodities have been slammed recently. orange juice, sugar, and wheat, hogs all down this year. only corn fractionally higher over the past six months. let's find some opportunities here. we have jonathan of -- he corps the food stocks. let us kick things off of kkm on the commodities. jeff, tell us why all of these ingredient commodities as we call them are down and whether or not you think this has got to be just straight up good news for the food prugsers. >> i think it is good news.

for the food producer as well as the consumer. we have seen tremendous volatility in the commodity space. look at lean hogs. down by 26% in the last six months. cash a little bit here in the greenroom in chicago. what we're actually looking for is continued down -- look at orange juice. talked about it last week. looking for -- it never materialized. we saw new 52-week lows in orange juice. sugar at a five-year low. lean hogs means a good thing, but i do worry a little bit about the kelloggs the general mills because they have warned about the u.s. dollar strength in the head winds overseas. as we see continued -- >> jeff agreed and essential currencies has been a major part of the story. the reason we brought this up. we're digging into the numbers, and i'm thinking i wonder if some of these lower ingredient costs and lower gas prices through distribution might help offset some of the currency woes that everyone has been moneying and growning about. >> it does. we worry about demand. look specifically at lean hogs or even sugar.

that demand, it's just not there. that production is keeping up. i know some folks are concerned about wheat. that seems to be relieved. it's all about demand and the production is not -- it's increasing some some spots. sfroo jeff thanks a lot for that. >> let's get the stock angle of the story. let's bring in the food and beverage analyst. jonathan, great to see you. in terms of some of the moves that we've seen in the stocks over the past few months here six months hershey up 14%. smucker up 1 % and so on. is that because of lower food costs or because they were simply able to push price increases along in the past and keep them? >> well it's both. falling food costs do two things at the same time that are both great. they make the products more affordable to the consumer. particularly that middle income consumer who really has been beaten badly in the past five years. relative to high income consumer. the second thing they do is provide a tail end to companies that request hold on to that

pricing. those cost moves are great, and that's helps hershey and smuckers in the industry as lot. >> as we see the pullbacks and some of these agricultural commodities these days which tox stocks will benefit the most from this and when will we start seeing that benefit? to answer your question, you look at dean foods chshgs we like a lot. prices after multi-year highs. the volume should help their profits considerably. we like that. we do like hershey. frontal boundary you look at what coffee has done this year unexpected and dramatic decline in the roasting grounds segment that's under pressure from single serve. that should help them too. we like all of those. >> do you think it will jonathan, balance out the currency headwinds? >> well when the companies i just mentioned have small exposure overseas and that's why i mentioned them particularly. for the companies with big

global businesses, no. i mean, you are going to see a currency reset that's going to hurt their profits probably more than the commodity tail wind and developed markets will help them, but you have to remember, that's not a fundamental either. that's a one-time reset. doesn't change the growth or the fundamentals. >> back when commodity prices were spiking, it's 2008 wooin, 2010. you get the picture. these companies announced price increases. now that commodity prices are falling, is there any chance in hick that we're going to see price decreases or should margins just expand? >> you bet. the answer -- it depends on volume and demand. there's categories they're got under prir. take a breakfast cereal. a wonderful business for years. it's been under a lot of pressure as people choose for protein heavy breakfast and eat it away from home. as you are seeing prices come down and they're trying to stimulate demand that's one where, yes, you see prices come down. chocolate, i don't think you'll see prices come down at all. you have a couple of companies

on innovation. even as costs come down. it depends on the category and it varies. >> jonathan it was a real pleasure to have you on power lunch. thanks very much. >> great. thank you. >> all right. take care. likes dean foods and hershey. meanwhile, shares of target up about half a percent. just moments ago on the first hour of power lunch target cfo told our courtney reagan what is really driving sales. take a listen. >> in the middle of january we said we thought a 3% comp for the fourth quarter ended up today reporting a 3.8% comp which was a pleasant surprise for us. i think what really drove that was several things. first, we had a very -- a great discount on gift cards that we did over the black friday holiday. all those gift cards came back into the store in january, so really bringing all that sales back in january. >> and right now there are six target analysts with a buy rating on the stock. 12 with holds. two with sells.

on target thinks the prospects are bright. pat vick a neutral rating with a $70 price target. welcome to power lunch. on a day when target shares are setting a new 52-week high. the stock is up 38% since may. it's coming up against tougher comps after that hacking incident. why should we still be in target at this point? >> i think the story today is really about leadership and strategies going forward, and so what they've outlined on today's call as well as what they plan to outline on the march -- at the march 3rd analyst day are very distinct strategies to drive growth. i think you did see an acceleration in the business in the fourth quarter. the on-line business was very strong and it seems like those new categories that they're really focused on working. >> patrick, you had a neutral rating on the price. your price target is $70, which would imply that it's basically dead money from here. did you miss the wrong end target? did you underestimate the power of brooirn cornell? >> i did miss some of the run in

the stocks certainly. as far as the business though looking forward from here that is one of my concerns melissa. what you mentioned. the comparisons. if you look at the fourth quarter, they had a 3.8% increase in same store sales. store traffic was up 3.2. last year's fourth quarter store traffic was down 5.5%. some of that was the data breach, no doubt. on a two-year basis, which is important, it's an important thing to look at traffic was down. i think as they come up against tougher comparisons, you'll see the top line. that comp number slow a bit, and even the guidance they gave this morning for the first quarter, a 2% increase in same-store sales implies that things will slow down a bit. >> yeah. we look at target. they used to be known for sort of having, you know, 80% of the stuff everybody else had, and then kind of their cool special stuff. are they getting that vibe back? are they getting that gain back because if they're just going to sell me bounty paper towels

then the nationalingins will be slim and they'll be competing against everybody. are they special again? >> i think they really do want to focus on differentiation. particularly in those categories that they talked about. lifestyle, like baby kids and wellness. i think the wellness initiative is something very very significant. >> patrick, if not target then what? what do you recommend? >> i like big lots here dsw, kohl's, which will report tomorrow morning. identify got a good number of buys. i'm just not that positive on

the mass merchant space. the wal-marts and targets. >> much more on target. check out power lunch.cnbc.com. let's check brent crude ahead of the close and wti as well. we're up $50 in wti. brent crude up $2. that's the european trade. we care about wti. that's what gasoline is priced off of. we're up $120 a barrel. also, the triple q's that mirror the nasdaq as we are watching a march towards -- back towards, i should say, nasdaq 5,000. the qqq is up one-tenth of 1%. here's the menu for the rest of the hour. the next big battleground for tech is not your lig room. this song should be a big hint. has apple's record run created fantastic opportunities in other stocks. we'll give you our theory and names ahead.

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fed president loretta mester will join us live. it's tomorrow on cnbc. >> forget your living room. the next big tech battleground is going to be your car. many would say it's about time because the current state of car connectivity is this issue in need of a serious tune-up. phil lebeau joining us now. >> the numbers that are out today from j.d. power with the annual vehicle dependability survey they are not encouraging and it reflects what a lot of people are already saying all around the country. i hear it from my friends and relatives. i can't make a phone call in my car. what's wrong with my car? this is a survey of 3-year-old vehicles. j.d. power sent out a survey to all the owners and said tell us what you think about what's working, what's not working in your vehicle, and it's clear there are blue tooth blues out there. that system which is really a consortium of different tech companies that use that system, 55% of the people said they can't get any phone recognition on their bluetooth system in their car. 31% said there was no automated connection as soon as they got

into the car for overall vehicle dependability. when you look at the 2012 mogdzs 3-year-old models you're two and a half more times likely to have your connectivity system break down and three years than you are in the first three months. 2012 models and 1.5 problems per vehicle. 60% of the problems are design related. we're not talking about mechanical failures. we're talking a lot about tech issues within the dashboard of the vehicle. that said, the most dependable vehicles according to jd power for 2015. lexus tops the list. let's hand it to the folks -- buick is having a heck of a week. comes in at number two. climbs to the number two spot. toyota is third. followed by cadillac, and then you have a tie for fifth between honda and porsche. i want to quickly show you the stocks over the last year. for some of the key suppliers who are working in that dashboard area brian. we're talking about johnson controls visteon, delphi. we're not saying these guys are responsible for the breakdown in

connectivity within a vehicle, but this is that area where everybody is trying to do more in conjunction with the automakers and as a result, we've got a lot of things going on here melissa, that frankly, if you look at the vehicles that are out on the road right now, most of them here just not working in terms of connectivity. >> so if this is not going well phil, does this open the door for, let's say, apple to get in and own that dashboard? >> absolutely. >> absolutely. apple car play and android auto. about 650,000 vehicles worldwide. that's preponderanced to jump to 250 million over the next five wreerz. that's the area that both apple and google can exploit because connectivity within the car, it's a mess right now. if you can do it right and do it well, you are going to find the consumers will say i want it. i don't care who builds it. if it's apple, great. if it's google great. that's a separate issue. i want connectivity. especially since i can't use my phone -- can't hold it while i'm

driving. >> first off, i'm still wondering why car play is only available in volvo right now. that's an odd choice. >> it's early, brian. >> here's my issue then phil. let's say i'm an apple person, and maybe you are an android person. does that mean that we're going to only be able to buy the kind of car that matches our phone operating system? man, i really like to have that in a buick? oh, but that's android, and i'm apple. you are either going to switch my phone ecosystem -- >> that's a separate question that the automakers are all going to have to cross at some point. do they say i'm getting in bed with one specific supplier? at this point really i'm being honest with you. i hear more complaints from consumers about this issue than anything else. it's a joke. when they go into dealerships and they say i can't get my phone to work, you know what they get? i don't know. it's not working. don't know what to tell you. this is the quickest way that the automakers are going to lose customers. they know it. so do apple and so do google. that's why they're spending so much time in this area. >> all right. phil thank you very much. all right.

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>> welcome back to "power lunch." mcdonald's shares are the best performers in the dow industrials today. the world's biggest restaurant company is up nearly 4% and it's been climbing all session long. now, not a lot of specific news that are sparking any kind of move here. still, traders in the options market have traded more than three times the number of bullish bets than bearish ones so far in the options market. shares have been under performers over the last year. up only 2%. today's move means that mcdenialed done's shares are up 5% year-to-date. back to you. >> dom thank you so much. gaming stocks over the past few days on weaker than expected revenues. it is unusual because macao usually does well in the days -- hence, our sheep reference. with me now in studio -- it's great to have you with us. >> why is this your weaker than

before? -- >> that's a large part. what we've been hearing in the last 24 48 hours is v.i.p. has been even softer than that. beyond that i think the last week we've seen some up and down days. going into chinese new year we saw some very weak days on the casino floor. otherwise. i think in the days after we saw a significant pick-up in business even in the early days of this week we've actually continued to see pretty strong oem's. >> do you think we've seen the worst when it comes to declines on macao.

>> forced choose right now, would you choose the gaining stocks that are more levered to the u.s. versus those more levered to macao, and which one? sfwroo our number one pick would be an mgm. certainly given much heavier exposure. >> you like the reet. >> absolutely. i do like the reet. i think the view on the reet is different in the sense that you think the opportunity is more on the regional assets within mgm's property there as well. >> we have to leave it there. thank you. >> over to you. >> melissa, thank you. >> well thankfully there are only about two and a half days left in the month of february because many parts of this great nation are on pace to record one of the coldest febz ever. here's something to warm your investors' souls. dom joining us now with more. dom. >> it started off so cold in january in terms of the stock market. right now things are really heating up. the nasdaq 11 straight day of gains, and of course it's up about almost 8% for the month. now, if you look at the overall

sectors, the hottest three entering today's trade and the s&p. material stocks up 9%. very hot so far. it's not a big part of the overall market. still 9%. technology nolg is important. the biggest sector overall. up 8.5%. retail consumer discretionary stocks up 8% as well. this is where the heat has been in terms of the buy side in february. jp morgan up 12% as well. remember, mcdonald's is posting a healthy gain today. it's only up 5% so far year-to-date. in the s&p 50000. take a look. >> maybe some of the beaten russian shares and speculation.

trip advisor, like we said, and priceline. the travel section has been hot. of course, that's because expedia, travelocity, orbitz world wythed, no matter who you say, it's earnings and take-outs. again, hot parts of the market. especially in the nasdaq for travel stocks. >> meantime a mystery over paris. drones are buzzing over closely guarded landmarks. here's nbc's bill neil. >> for the second night running, mystery drones were spotted hovering over some key landmarks and overnight monday hovering over it is u.s. embassy. it was back last night or at least a drone or possibly drones hovering over five locations all across central paris. now, the police did manage last night to spot these drones and even to film them. people are worried.

is there an innocent explanation, or is this something much more sinister? >> i wonder if the french are saying -- still ahead to apple with love. perhaps the stat to end all stats on just how big apple really has become. as we do every day at this time we are counting you down to the oil close. brent crude is now up nearly 3%. stick with us. power lunch returns right after this quick break. the quietest or nothing. the sleekest... ...sexiest ...baddest ...safest, ...tightest, ...quickest... ...harshest... ...or nothing. at mercedes-benz, we do things one way or we don't do them at all.

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i'm courtney reagan sxfshgs here's your cnbc news update at this hour. senate democrats have agreed to a republican plan to fund homeland security without linking it to immigration legislation. senate minority leader harry reid says he looked forward to working with republicans to get

the merdon by friday's deadline. former president bill clinton visited a newly built cholera treatment plant in the capital of port-au-prince. recent destruction from the 2010 earthquake that killed 300,000 people. well petrobras has hired jp morgan to manage its asset sale this year. as the embattled brazilian state-owned oil giant battle az corruption scandal. >> are you distract whenned you walk busy streets? if so you are not alone. researchers at william patterson university in new jersey studied more than 2,1,000 workers in new york city and found that nearly half who crossed busy intersections with don't walk signs weren't peaing any attention. they were either wearing headphones, talking on the phone, or looking down at an electronics device. our mothers would be so disappointed.

>> 8. 4 million barrels of crude. stocks are at eight-year highs. you think that we would see pressure on this but we didn't and traders are telling me that is because this is all about refineries and this is about products. yes, we have refinery maintenance. we have refinery beings. we have refinery strikes going into a fourth week. that is causing those products to spike. that creates a pent-up demand if you lshgs for crude, and that's why traders aren't worried about this 8.4 million barrel build. having said that they're looking to the weeks out and the months out. they do think that we're going

to work through it. he is sharing it with the market, and that took brent crude up. back to you. >> i will say that kyle cooper a guest on this show sent me a note and said clients are saying by his own account, oil production is 9.285 million barrels a day. that is another record high. >> that is right. >> more oil is coming out of the ground than ever before. >> jim cramer said it best this morning. america is the new opec. >> speaking of oil, check out shares of bill barrett. it's a midsize oil and gas exploration company. the stock is down today.

earnings are weaker than expected. at least 50% to preserve their balance sheet. a 50% cut in future developments. >> we're hearing all sorts of cap ex and then also taking a look at u.s. silica. it's a provider of sand to fracturing. weak results. raising its bad debt expense. u.s. silica saying it will no longer give ebida guidance because of lack of visz eblt into the oil and gas markets. you pair this brian, with what we're hearing from chevron. just the biggest bond offering by a u.s. produce arer. $6 billion in bonds because it's shoring up its balance sheet in case of further oil decline. >> you know that silica market the sand market for fracturing is not a very big market. you got a lot of little guys like one-off trucks. the fact that they do not have

visibility into their customers means their customers don't have visibility into their own business because they would tell them. >> take a look at silica. >> the ticker on that one. then also the other publicly traded ones -- those two are getting hits in today's session. >> thank you very much. >> let's talk more stocks. every day at this time. trying to walk through five analyst recommendations of stock news that you need to know about. let's do it. your stock number one is one we just talked about. petrobras. moody's cutting the debt rating to junk status. second cut in less than a month. melissa, stock down 40% over 12 months. i will say this. the p.e. is now less than five on petrobras. >> back in september this was a $20 plus stock. i mean that's what a corruption scandal and delayed earnings releases will do to the stock price. >> exactly. >> next up here ptc therapeutics with the new high in today's session. credit suisse raising estimates. price goes to $100 from $66.

reuters reporting that ptct is a potential take-out. it could be possible suitors here. credit suisse believes a take-out is it a likely outcome before or after phase three data released in october for its treatment. this is a rare disease drugmaker. >> who is not a biotech take-out candidate perhaps because everybody else seems to be buying each other. eight analysts cover the names. their average target price is $68.07. next up sprouts farmers market. initiated by. capital markets target there. $46. now, the stock is only up 4% a year on competition concerns. be and t analyst says new competition that is being faced in the core western markets is "manageable." >> this is an interesting call here brian. we always commend analysts for coming out ahead of earnings. they're initiating the buy rating ahead of earnings tonight. we'll see how that pans out. next up we'retation a look at sam adams. downgrading to a market perform and an wrout perform. remember earnings last night.

2015 guidance. a biz mal. the stock that was up 43% since mid-september. cowan's thinks this looks expensive given the bad outlook it gave for 2015. >> you know they have a five-pond compounded annual growth rate of 37.6. that's a darn good number. if that slows down it just seems natural that the valuation is going to have to come down like a beer whose top has been off for an hour. thank you. >> the -- a california-based data and analytics company, it was begun overweight atsteins. their target is 40 and melissa, that implies about 40% up side. >> yeah. this has been a dog this year though, brian. it's down 14% year-to-date. there is a lot of optimism. on top of the call that you were just mentioning da davidson just put a 49 dollar price target on this stock. this one could be one to watch. >> everybody knows about apple. up nearly 20% so far this year. there's a whole wide world of tech stocks out there. not called apple. can you imagine? wait until you see how the s&p

tech sector is done with apple and without it. plus a handful of tech ceos are still around from the days of nasdaq 5,000. how have they managed to navigate the boom to bust the boom, the bust, and the boom again? stay with us.

>> i talked to one of the management gurus, investors, and they say the secret to the ceos' longevity, they're innovators and they're unafraid to reinvent their firms, and, third, they're unafraid to hire others to help them. now, given the confidence pegz the average tenure for an s&p

500 ceo at 9.7 years. it's pretty xeerd. jeff be sfwl os he has created an intbt retail giant and is forcing recreation of all retail. thinks secret, relentless focus on the customer experience and he is not afraid to fail. he also sets profits for long-term projects. stocks up 459%. like bezos, starbucks' howard schultz is obsessed with the customer experience. one analyst said that he came into a coffee shop in brooklyn to see what they were offering. he is constantly checking out the competition. it's important. the chain stumbled when he stepped aside in 2000. returning in wait he closed stores, hired new people and asked for suggestions. he was willing to change the term, and it did. stock is up over 900% since 2000. larry ellison is oracle's founder and chairman now. he is the first primary strategic thinker. he changed way we think about a product. oracle bundled things and sold

it as a site. oracle stock up over 17,000% since its ipo. gains are far more modest. up only 17%. they help to build and change systems with a series of acquisitions, bringing auto new product and talent. stock is down though, since investors are giving hem a break. basically because of rapidly changing pace of the technology in his space. they say really ubd note that he is actually survived and maintained a leadership role at a time when a lot of his rivals that were back there in 2000 they're no longer in existence. >> i know. what's interesting is that john chambers is one where some people are saying he should step down for some period until the stock has rebounded. more recently in the past 12 months or so. >> there's another kind of reinvention. reflection point. a number of people still think it might be a share of the next where he actually -- he has been there since 1995. >> thank you. >> thank you very much. there are many mind-blowing stats about apple floating around but this 3450i9 be the stat to end all stats.

with a market cap of $762 billion, apple's value is now approaching surpassing the value of the entire brazilian stock market. apple already now worth more than the exchanges. the total value of every company on the exchanges of singapore and russia. our thanks to tom mcclellan for pointing this out. brazil, by the way, the seventh biggest economy in the world. this got us thinking. if everybody is buying apple, all the attention on am, is that leaving a lot of really other good companies completely unloved and unbought because all the money is going to apple? kim forest is here with fortpitt capital group. i'm assuming our theory makes some sense. do you think there are good companies that are being ignored because everybody just kind of runs into apple's stock? >> i do. i do. i think -- i think we don't revolve around the sun anymore. apparently we revolve around apple. just kidding on that. that's leak swroex for science

people. anyhow, getting back to -- >> i think it's good. >> we have three picks today. sandisk, and ca and xilinx. looking at businesses and the technology they use is a great idea. >> yeah. okay, so xilinx. sandisk we know. users buy their stuff for flash memory, phones whatever it might be. talk to us more about xilinx. that's a name that ironically we used to talk about a lot. it's kind of been off the radar. why do you like it? >> well we like it because it has stumbled recently but it doesn't necessarily mean that the business model is broken. the people that they sell their products to they make something called a programmable gatorade chip. they're used in mobile networks so base stations things below the antenna of the tower.

china mobile stopped buying in bulk for its . >> i understand that you own ca kim? >> i do own ca. fort pitt and our portfolios own and, and i own it as well. it has a huge component of mainframe software. the mainframe has not gone away. it's still an integral part of many businesses. >> the new ceo is bringing the company in from decades before

past. they're trying to show people that they're relevant, and i think they are. >> i have to can you about sandisk. when actually reported the quarter, it reported a miss on a preannouncement. i'm wondering, did fort pitt own sandisk prior to this xshgs what's the next catalyst at this point? >> first of all, they have a patent problem or a patent fight going on with another company. not only does the company make stuff that you and i could go out and buy, but their product fwz into lots of enterprise appointment, and solid state disk drives you know drives without parts. they make those. one of their higher margin products is in a patent fight. if that gets resolved this year that's a catalyst. stlo that's going to take six to nine months you say, until they can sell the product again. that's a long time, kim. >> that is a very long time. we're long-time owners. we like to buy low, sell high. this is a low point we feel for sandisk. >> all right. >> kim, it was a real pleasure to have you on the program.

is apple masking other good opportunities segment which doesn't fit on a banner, but thanks very much. >> a little long. >> thank you. >> all right. speaking of apple, tonight on "fast money "eye i'm be talking with citi analyst jim suva, and he will give us the five reasons why apple's stock still has room to run. five. >> you had six, i would be impressed. >> coming up can a small company take on apple? we're going to tell you about a little company called pebble which is trying to rock the boat in smart watches. plus i'm praut sure you have never seen what three tons 6,000 pounds by the way, of cocaine looks like. there it is. you're probably wondering how much it's worth, where we're showing you video of it. things like rewards bonuses on credit cards... extra interest on a savings account... preferred pricing on merrill edge online trades and more... across your banking and investing get used to getting more. that's the power of more rewarding

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did you ever wonder what three tons of packed cocaine looks like laid out end to end? here it is. colombian authorities showing off their haul seized from a drug gang. police say they were destined for panama with the intent of selling it in central america and mexico.wondering, the u.s. street value estimated at more than $90 million. >> wow. wearables supposed to be the next big thing but they haven't caught on with hillary clinton. listen to what she told kara swisher at a silicon valley

conference for women last night. >> apple watch or fitbit? >> well you can tell i'm not doing fitbit. and i haven't gotten into the apple watch yet. yeah. i'm not in a wearable frame of mind yet. >> all right. >> you know i mean three people have given me a fitbit or a jawbone, and i look at it and i think, do i really want something telling me i should do what i know i should do? >> okay. so maybe hillary clinton isn't big on wearables, but one company tried a novel approach to selling its watch and it may turn out to be the biggest crowd funded project ever and a real threat to the apple watch. job josh lipton joins us with the nuts and bolts on pebble. >> if you needed more proof wearables are red hot, take a look at how much money pebble is raising for its latest wearable.

the startup launched a campaign on kickstarter for its new start watch called pebble time and it's proving to be a big hit. some 43,000 backers have already contributed more than $9 million, the fastest funded campaign on kickstarter ever. now, the new start waven is water resistant, features a color display, and up to seven days of battery life. it will retail for 199 bucks, but pebble faces a real challenge, specifically the world's most valuable company. apple will ship its watch in april. the company reportedly asked its suppliers to make as many as 6 million units of its watch during just the first quarter. still, pebble's ceo told "squawk alley" he isn't worried, not one bit. >> we're the most popular smart watch plat norm inform in the world.

the direction we're taking making a watch that works really well as a watch but is also very smart is the one that consumers actually want. >> now, pebble boasts advantages of its own. it's new wearable is platform agnostic meaning it works with iphones and android smartphones. pebble is taking advantage of a wearable market on track for significant growth. analysts at idc say the u.s. wearable market will reach 24 million units this year and surge to nearly 40 million units in 2019. brian, back to you. >> all right, josh lipton thank you very much. coming up next point/counterpoint. three hot topics three ways for me to win, and we hit on blackberry's rather old-school efforts to jump back in the game. plus, we asked you to channel your best marshawn lynch and come up with a catch phrase suitable for hats and t-shirts. we'll read some of your responses coming up.

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point. counterpoint. let's get started here. topic number one. planning on new funky headquarters that would be a series of canopy like buildings. we don't have any images yet but here is some of the work being done by big architectural firm working with the heather wick studios. what do you think? cool, not cool? >> whatever it comes out to be google has work to do in the town. they're one-fourth of the population. frask traffic in mountain view is awful. why don't you give back a little more to the community because you have cops and teachers living 100 miles away. topic two, blackberry saying you're my boy, blue. the blackberry classic is coming out to verizon. a smart appeal to long-time users? >> i think it's a smart but i think it will be a weak attempt to capture the glory days. i get not wanting to be hacked and going there for the security. but they don't have the photos,

the camera, the ability to can tour video that people love these days. they don't carry cameras around. they just want to carry their smartphone away. >> i know but battery life is a big key, i have to say. it could be a winner because some -- >> this thing is not too bad though. >> some people are getting sick and tired of smartphones. >> finally here topic number three, american express raising interest rates on more than 1 million customers. the rate will climb 2.5 percentage points to nearly 13%. >> got to do something. it's the worst performing dow stock in the index. >> and it just got booted from costco. that exclusive agreement is gone so i guess it has to make up the difference somehow. >> we didn't really argue once again, melissa. >> i know. that's frightening. >> what's on "fast money"? >> we are going to talk as we march to nasdaq 5,000, apple was a big part of that run. so we've got an analyst, a citi analyst, who says there are five reasons, including the auto why apple could go higher even as apple sees more than 2% losses in today's session. >> looks like another big show

melissa. thank you. see you tomorrow and we'll see melissa tonight on "fast money." check out powerlunch.cnbc.com. "the closing bell" begins right now. and welcome to "the closing bell." i'm kelly evans and that's bill griffeth taking a picture with his blackberry. >> you can take wonderful photos with a blackberry. it has a terrific camera. >> it wasn't always that way. i use it all the time. >> love my blackberry. let's get to business for "closing bell" this day. stocks giving back some gains we saw as we entered the final hour of trading. the dow still positive just by a couple points. still trying -- any positive close we know will be a new all-time high. not so for the s&p right now. any positive close will be a new all-time high but it's down