good morning. 11:00 a.m. on wall street and "squawk alley" is live. ♪ ♪ good monday morning. i'm carl quintanilla with mookie betts and john brennan. busy monday morning. >>. >> reporter: that's right. pintrist kicking off its road

show today. they started their day today, now the important part of these meetings is their teaching the sales force how to pitch this deal to investors. they've got a billion dollars worth of shares to sell. how exactly do they plan to do it for one they came out with a pretty conservative evaluation. they also plan to tell investors that they're different from other social media companies because of their business model which really incorporates people looking at different inspiration and aspiration with regard to working out and wedding planning and so forth for people that aren't necessarily their friends, per se. they also want to tout this idea that they do have an e-commerce related model in terms of eyeball so they don't at this time collect any revenue from the users ability to purchase on their site. today's range implies a

valuation below their private round as i mentioned and the reason they may need to do this is for one, because they're user growth is slowing on a monthly active users basis by quarter. you can see that those numbers are really plateauing. the company is also not exactly profitable at this point in time, but on the flip side, revenue is growing. an average revenue per user is growing especially here in the u.s. now, after today's sales force meeting at jpmorgan they headed downtown to meet with the sales force at goldman sachs. they'll continue the road show throughout the course of the week where they'll meet with investors to pitch this deal before pricing next wednesday and they'll begin their debut on thursday, guys >> leslie, thank you very much. another busy week when it comes to new issues. for more on pinterest, we're joined this morning by kara

swisher. good morning. >> how you doing >> i'm good. what do you think we should know about this one. >> it's a different company than the others, than the ride hailing company. it's advertising base in a lot of ways. it's a different type of company and actually i always thought the pinterest would get sold to google and amazon and it still might in the future, but it's a little different, a little less showy, a little less out there. this drop in valuation i think reflects how people feel about these unprofitable companies going public and how profitable they can be. i think they're losing almost $750 million in revenue and losing 68 million or something like that, something in that range. it's not as bad as the car share companies but it still reflects how do you get to these massive evaluations that have been made previous. >> you've had ben at the code conference in recent years. how do you think he'll act as a

spokesperson for this company? >> he's very shy. he's a shy person and i don't mean to say he's not articulate about his company and he can't talk about it and he can't explain it, but he's brainy, he's shy. he doesn't seek the limelight like a lot of the others do. he's not -- he's not someone -- he's not unfriendly, but i'd be interested to see how investors look at him. i don't say he's the reluctant ceo but he's very measured and very mature so it's a very different personality so it'll be interesting to see what investors think of him. he's certainly done a nice job in growing this thing to the size it is, of course. >> you feel like the hype cycle has moved the opposite way on pts than it did on lyft. a couple years ago the wrap on lift is they'll get steam rolled by uber, they're number two and not going anywhere. when that ipo came up, people were so excited about it.

pinterest was serving this underserved group, largely women in america and it's valuation seems to have come down. could people maybe underestimating pinterest? >> it's a really interesting biz. they don't look at them the same. it's not just women in the midwest. it's all over place. it's a confusing business to explain to people. car sharing makes sense. this is a really sophisticated and interesting business. it's hard to understand. it also faces pressures from a google or some others and so, you have to wonder how big it can get and i think that's probably the worry that investors have is how big can this get and it does fit in nicely with an amazon. it's a marketing vehicle in a lot of ways. sort of like the ads of a magazine gone digital. it's an interesting thing and the question is where can they see growth, where they -- can they do sales of things on

pinterest? that's the kind of stuff if i was an investor i'd want to know. what's the next version of their business it can only stay a certain size. i think they haven't articulated that well enough maybe to investors or maybe they want to be -- they want to do really well on the first day as opposed to getting people too hyped up and that's very much like ben. he's not a hyped person. i'm not surprised this is not a hyped ipo. >> you just hit the nail on the head for me, kara, when you talked about the possibility of sales through the site because that to me almost seems like it's the holy grail for a company like pinterest for people to be able to purchase what they're seeing put on all the boards on the website. do you think that is in the cards for pinterest and if so, we're talking so much about path to profitability in terms of lyft and ipos that are expected this year, is this really the message for investors when this comes to market next week? >> i think the vision is how big

can it get. it runs smack into amazon then and google. it runs into a lot of companies that do what they do really well. you remember what happened to groupon. it was not -- it was similar but not the same. and this is just -- these are message boards. these are pin boards where people put up stuff and it does have a lot of e-commerce possibility and they've been trying different things over the years. it's interesting that they price it had below. i think they want to just make sure that they don't have a thing where it wouldn't go very far up and it would actually go down. that's probably smart on their part to be conservative here and it's, again, in line with the edge oes of the company. >> they don't want to be in that business as much, another difference with this company is on the founder control. they have set up some mechanisms around that, there are a couple different classes of shares but not to be held in per petty.

even ben silverman has to remain actively in the company, not sell a bunch of shares in order to maintain that voting power. >> that's interesting. i like that. it's very much in line with ben. he's just not -- he's not someone that's -- if you meet him you're like why don't even want to be ceo. he's very thoughtful. he does things like this. he's very analytical. i'd be interested to see how he does with investors. i'm not going to be in any of those rooms. he's not easy to interview, although i do talking to him. i do enjoy talking to him away from the spotlight. he's more interesting out of the spotlight than in the spotlight which is odd. >> his interview with you on stage was memorable for that very reason. we'll see how it goes. the. the uk announcing this code of practice for tech companies saying that internet sites could be fined or blocked if they fail to tackle what they're classifying as online harms and

we see regulation around the world, kara, branch out from your standard gdp art? >> it's britain, by the way, which has much stronger libel laws. they also don't have the first amendment. so -- this would be very difficult to do in this country, but the idea of a regulatory body is really interesting, the concept of having a separate regulatory body that may be apart from the government that sort of has this -- has this notion and when i talked to nancy pelosi here in this country, they talkedabout a separate bureau at one point should there be a bureau that regulates online stuff like this, should there be a separate thing or our current regulations fine but this is really quite sweeping and would be problematic for all these companies including apple, not just google and facebook and twitter, but also apple to maintain these things because apple has the app store and everything else. they're not just going for terrorism, they're doing harmful content. it's a really big reach for this

country and it was backed by the prime minister theresa may who may not be the prime minister for more than 15 more minutes, but, you know, it's an interesting concept of how they're feeling about social media in europe as opposed to here but that mood is growing here too. the same thing is growing here, though i doubt we'd ever pass anything like that, an independent regulatory board. >> it seems like we've crossed into new territory with this one. all the big tech is, you know, toss me into the briar patch now. >> yeah, please. >> everybody, this is different in that they'd be libel for hate speech, sexual abuse and violent content, terrorism, self-abuse, et cetera. i wonder, is the era of libertarianism in content over it used to be youtube, facebook, still twitter to some extent, all these services were saying, hey, you don't need to police this stuff, the good stuff will rise to the top.

it seems more of the bad stuff will rise to the top and even those companies are backing off that stance. >> they have to clean up the mess they've made. they need to be policed. they don't get immunity any more at least here in this case and may not get immunity in this country. some people feel that there are laws in place now that should be enforced that should allow -- make them do this like looking in your email and things like that, but in many ways, it's sometimes smart to pass new laws to put them on notice or take away, say, section 230 of the communications decency act where they don't have immunity. that would be devastating to these companies because they'd be libel for what's on their platform and open to litigation and all kinds of attacks that may some cases may be justified and other cases maybe onus. it's going to be this will be really interesting if it happens in britain and it's going to happen in germany if that's the case and throughout europe i think. you wonder how much it's going to come over here that the stuff that can come over here will come over here. so we'll see.

it's an interesting -- it's an interesting time for internet companies to think about what -- how they'll be regulated. >> kara, again it raises the question i know we've been debating this for quite some time already on our air, it raises the questions how would these companies actually carry this out and combat what's considered hate speech in some of this other negative or violent content? we've talked so much about the role a.i. is playing versus humans. it does seem so reactionary and whack-a-mole, what would be the answer >> maybe not have businesses that rely on verality of toxic content, maybe that, something like that. cigarette manufacturers have been pulled back, juul, you talked about juul earlier, all these companies that are doing things that are potentially damaging have guard rails and the question is what rails are g which ones promote innovation, how can we not overreach as regulators if the regulators are going to do that and so, you know, i think -- it's just -- we've got to figure out a smart way to be innovative, enforce

the laws we have because there are laws on the books about these things and at the same time impose new guard rails on these companies to mind their manners, i don't know what else to say. clean up your platform and don't let -- you maybe are not going to grow as big and i know that's -- they may not -- it may cost more money for them to run these platforms just like it does cnbc or "new york times." we have rules. so that's the questions. what are the rules and who's going to pass them and how stringent are they going to be >> exactly. kara, thanks as always. >> thank you. when we come back, why one hedge fund manager is looking to move away from the internet giants and focus on content producers and streaming. dan niles joins us next. the fire going for another 150 years. ♪ to inspire confidence through style.

♪ i'm working to make connections of a different kind. ♪ i'm working for beauty that begins with nature. ♪ to treat every car like i treat mine. ♪ at adp we're designing a better way to work, so you can achieve what you're working for. ♪

mno kidding.rd. but moving your internet and tv? that's easy. easy?! easy? easy. because now xfinity lets you transfer

your service online in just about a minute with a few simple steps. really? really. that was easy. yup. plus, with two-hour appointment windows, it's all on your schedule. awesome. now all you have to do is move...that thing. [ sigh ] introducing an easier way to move with xfinity. it's just another way we're working to make your life simple, easy, awesome. go to xfinity.com/moving to get started. wall street is turning its attention for earnings season for an indication of where the year is headed. >> this is a very interesting spot for the markets. if you look at a six month chart of the s&p 500, it is a near perfect round trip. october 8th was a monday. the s&p closed that day at 2884. we're at 2887. we found out in the fourth quarter is there are lots of

potential positive catalyst to stop the decline and get people more positive. it didn't work until prices got to an extreme. we're in a reverse situation where we can point to some of the negatives or the headwinds out there for the market. this market has acquitted itself very well. it's doing what it had to do to stay supported like go to defensive stocks or big mega cap stacks. now the question is, though, has the market truly priced in a little bit of a down beat first quarter for earnings it's been behaving that way. i think that's partially the test. we're also get something unevenness under the surface of this rally when you look at the russell 2000 nine cap being below. other sectors that often are bellwethers of risk appetite or cyclical strengths are not playing long. fewer stocks making new highs than you would expect for a broad market that's plummeting a new high.

is it time for this to take a rest and flatten out ahead of earnings >> what do you say to people that argue it's a classic set-up >> it really is. honestly, it's burned up a lot of scepticism, it has basically refused to pull back very much and so even today, right, all kinds of excuses. you could have had a bigger selloff. here we are less than a quarter of a point down. i do think there's an upside case that says the fed is basically more do havish than the u.s. economy merits right now. i think the big question we've been talking about is tech ipos does that come off as a big just liquidity event for these early backers or is it going to generate a new hype cycle. i think that's what we have to see. >> thanks mike. meantime, a tech hedge fund manager into content producers joining us to discuss alpha one

capital's founding partner is on the phone, dan niles. which ones and why >> i think there's two big trends going on in technology this year. the first is you've got a bunch of new over-the-top services coming out to compete with netflix. you heard about apple in late march. disney's this thursday they have their investor day talking about their new over-the-top streaming service. you've got time warner media coming up later this year and comcast early next year. all of these guys are going to need a lot of content, we're actually in cbs, we own viacom and discovery and we own lion scape because the one thing you're going to need is you're going to need a lot of high quality content and you've been really suffering for the last several years as people have cut the cord so to speak. the second big trend is video games. you've got the big internet giants there, microsoft, google, amazon, apple. they're all planning on trying to become the netflix of gaming

and, you know, we've had lots of issues there with the whole fee to play movement. we own electronic arts because we think they'll do incredibly well. that's what we're moving to and from a lot of the internet giants out there. >> you think netflix is priced for perfection here as these other would be rivals start to find their legs? >> i think -- priced to perfections is maybe not the way i think about it. valuations can go to any level you want. i lived through 1999, so did you. you can get the crazy valuations, but the problem with netflix is you've got four guys with lots of capital between apple, disney, time warner which is owned by at&t and comcast all getting into that business. if you're netflix, i just don't think you'll be able to grow nearly as fast and to your point it is priced at a very high

valuation. they're going to lose $3 billion this year. they're going to need their own content. the latest disney movies, captain marvel isn't going to be on netflix. so you watch netflix to get content. i certainly like my superhero movies. i'll probably end up maybe picking up disney. so for their streaming service. that causes a lot of problems if you're the incumbent. >> dan, the sensational appetite tor content, do you think this will drive more m and a and if so, where? >> i really do think. it's a great question. if you like at the guys getting into this business and you say, all right, how big are they and you look at the combined side, especially in video gaming, let's say, you look at microsoft and google, amazon, apple, you got 3.6 trillion in market cap and these stocks on average are down 8% from the 52 week high, if you kind of look at the big

video game vendors, they're a lot smaller in size. i mean, activision, they've got a combined mark cap, if you look at the media company, the four smaller ones, cbs, viacom, lion's gate, they've got a combined market cap of 25 billion. that streaming service apple announced, that's not going to gain any traction. they don't have enough content. if they're smart, they'll pick up somebody and merge it in to try to give them something to be able to compete and i think you'll see that in general. >> dan, it's john fort. i'm not clear of how you're distinguishing between these content producers. some of them are running platforms. they have data. are you talking about these

platforms that are generating data and interfaces that are able to be smarter about what content they are then pulling out and presenting or the actual on the ground producers of the content who don't necessarily have great data about who's viewing it but have a track record for producing good stuff? >> well, it's the latter, right? if you've got a lot of companies that all want to be the netflix of gaming, you need games. apple doesn't have any games. so you're going to need to get that into your universe or if you're looking at streaming video, well, netflix has got a ton of content that they produce. well, you know, if you're apple again, you don't have any. you're going to need to get some and so -- the prior segment you had you talked about regulation against these big internet companies, you know. we all saw how microsoft performed when they went through a ten year battle with the u.s.

department of justice. the stock declined 18% over ten years when they were in the midst of this versus the nasdaq up 65% or so. that's going to also weigh on this as you have more regulation, so and the nice thing is, people hate these companies that i'm involved in. cbs, viacom, discovery, lion's gate, people have been talking about cord cutting for several years ever since the they started to lose subscribers, you're now finally moving in the other direction. think for the video game companies, ever since fortnite came out, people have been switching to free to play. electronic arts finally have good free to play game. that's how i'm thinking about it, john. everybody loves the names we just talked about, the microsoft, googles, amazons, apples for the most part but these other names are pretty unloved. the big giants are going to need their content. >> dan, that's good stuff.

look forward to hearing more from disney this week about that space. always good to have you. thanks for calling in. >> my pleasure. >> dan niles. the dow's down about 118 points right now. take a look at the worst performing stocks in the average so far in today's session. far and away, boeing biggest drag down 4%. resqwkll" mo "ua aeyafter this break. don't go anywhere.

european markets set to close in two minutes. stocks lower in monday's trade ahead of what investors are expecting to be a tough earning session. tech was among the worst performers. shares of francis saffron also tumbled. production cuts of that aircraft sending shares of both companies down sharply this morning. brexit in focus.

prime minister may will go to germany and france this week and that's ahead of the deadline to meet with both leaders there about a potential extension. let's get over to sue herera for an update. >> good morning. here's what's happening at this hour. the trump administration has designated iran's elite revolutionary guard as a foreign terrorist organization. it marks the first time washington has formally labeled another country's military a terrorist group. critics warn that move could open the u.s. military to similar actions by unfriendly governments. russian president putin welcoming his turkish counterpart to moscow to discuss the situation in syria. russia and turkey have closely coordinated moves in that country where they created a security zone in the northern province. both have thrown their support behind syrian president assad. israeli border police casting their ballots in the country's national election as they are unable to vote on election day tomorrow. the ballots are sent to the

israeli parliament where those votes are then counted. a power upgrade is under way at the international space station. astronauts venturing outside the craft for the six and a half hour operation. that's the news update this hour h. back downtown to you, guys, carl. >> thank you. when we come back, morgan stanley katie huberty out with a new note saying not to underestimate apple's moves in health care and earlier on the show this morning, cramer is not underestimating her. >> we've got katie at 11:00 this morning. >> sorry dude. >> it's the way it goes. >> they'll be another -- i emailed her -- i thought -- >> you got bigger battles? >> my desperate plea is going to go -- my desperate plea is going to go unhinged. >> we're going to ask her about page 39 exhibit 24. ♪

♪♪ ♪♪ ♪♪

morgan stanley out with a new note on apple saying not to underestimate its push into the health care industry arguing that apple is quote, poised to emerge as a leader in consumer centric health care. this is as amazon announces some health tasks for alexa allowing

customers to transfer health information and make appointments using the artificial intelligence assistant. joining us now is the analyst behind morgan stanley's note, katie huberty head of north american research. good morning. >> good morning. happy to be here. >> this note lays out in great detail a case for apple making a big impact and a whole lot of revenue in health care. the part about it that gave me pause is that a lot of this seems to center around the idea of apple becoming a central repository for health information and that's something that seems to be the company has shied away from up to this point. they don't want to hold peoples' valuable personal information, they want it to reside on their devices only. does apple have to change that for the high end of your potential projection here to bear out >> it's an important point. tim cook has made it almost the

company's mission to be a stewart of consumer's data. if there's any technology company today that's well positioned to pull this off and build the trust of health care institutions and consumers, it is apple. >> you point to wearables as the most likely money making area for apple when it comes to health care, so what do you think is the pace of new product announcements specifically in the health care area that you would need to see for apple to hit that $91 billion health care revenue eight years from now that you said is your midpoint >> i would say wearables is the most near term, not necessarily the largest driver, the largest would be services over time. apple has almost 60% revenue shares in wearables today and we expect that to migrate not just from your risk but to your ear with air pods, sensors added

into air pods over time and in more wearables. we think new sensors like blood pressure, blood glucose, sleep pattern measurements are key to expanding the wearables portfolio over time. >> katie, i know you don't cover amazon, but you got this big report in the journal today which is outlining the alexa push to transfer sensitive information using software. they have the ability to do this under federal law now. when you're looking at apple versus other emerging competitors in this marketplace in terms of transforming health care, how are you assessing that competition and is there room for everybody? >> yeah. the way we think about it is, this is a $3.5 trillion market just in the u.s. a third of that is wasted spend and it's that wasted spend that technology companies are going after and it won't just be one technology company that

disrupts, it'll likely be many. some are advantaged in a.i. technologies, others in voice and still others in cloud. when i think about apple's advantage beyond consumer brand as well as a massive install base, it's engagement of the user base. it's important to note that apple users spend ten times android users on services. apple has proven its ability to partner with the health care industry. it has scaled electronic health records, you know, as i said. it's become a steward of data. there's a lot of advantages that apple has, but it's not to say they'll be the only winner in health care. >> katie, i don't know if we've asked you yet about the impact longer term of 5g on apple, on the phone cycle, on semis, on the evolution of hardware once that thing is truly widespread. >> yeah. near term tactically, i would

say iphone data points are stabilizing. we've published that we've seen the data in china improve after price decreases so that is good for the stock in the near term. longer term, you know, we believe apple sees 5g as a huge opportunity. 5g phones cost significantly more money. apple historically for that reason has been late to market on new communications technologies because if you're going to pass the higher price on to consumers, the benefit needs to be there, the networks need to be built out. so we do think that 5g is a big product cycle for iphone, but it's not necessarily near term. >> katie, does that bear out this cycle as well as you mentioned, apple has not rushed to get the latest wireless network technology into its phones as quickly as possible. we are starting to see 5g phones come to market. apple continues to have this boxing match with qualcomm which

is very much 5g relevant. does it matter whether apple has a 5g phone before the fall o 2020 >> well, from an investor standpoint, the market tends to anticipate a product cycle nine to 12 months ahead of time, so by the time we get to december or january, the market is going to be looking forward to a potential september 2020 launch of 5g. again, the new 5g phones will cost more money, right, which will advantage apple from a price standpoint, that has been a push back of investors that their products are much more expensive. i would expect that that gap to close as others bring 5g to market as a marketing tool. apple, again, is going to wait until the technology is ready and has impact on the usability of the phone. >> katie, what did you think of the services announcements from a couple of weeks ago,

especially in a week where we're going to see what could be a potential competitor, disney, have their investor meeting and likely more details about their streaming service as well? >> yeah. the most important takeaway for me was the breadth of partners that were willing to sign on for apple services. as you know, there's a debate around apple's defensibility of their tech rates and the facts that you had very big names signing up to share profits with apple speaks to the fact that ios, the app store is the -- really the only path to market for those that want scale and apple, ios users spend ten times in android user on apps, is engaged two times or more than an android user. and so it's that user base that those partners want access to and so, for me, that was the takeaway, just the sheer breadth of the video and the news and

the gaming partners that were willing to sign on. >> katie huberty of morgan stanley, provocative incites into apple's future. thank you for being with us. >> thanks for having me. we'll stick with apple with that recently announced move into content streaming and disney's new app set to be unveiled this week. how will bob iger board seat be impacted. julia boorstin has the latest. >> reporter: apple and disney will both soon be competing for consumers streaming subscription dollars, but antitrust laws do limit directors from serving on the board of their own company and a competitors board as well. now sources tell me that apple sees no issue here but this does put a spotlight, these new services put a spotlight on bob iger's apple board seat which has held since 2011. iger's about to unveil disney plus set to launch later this year as is apple tv plus which ceo tim cook unveiled just two weeks ago.

these services will be very different, disney, all about new content around its flagship brands such as marvel and "star wars" as well as its film and tv library. apple is expected to launch with just about a dozen new shows and no library. in january, in the order course of business, apple enters into commercial dealings with disney that we consider arms length including sales arrangements, digital services content licensing agreements and similar arrangements. apple does not believe that mr. iger has a material direct or indirect interest in any of such commercial dealings. now in the past decade we have seen a number of big ceos step down from boards because of potential conflicts. google eric schmidt's left aaph. now tech, media and social giants, these companies are increasingly driving into each other's lanes.

guys, i think questioning some of these board seats and what's going to happen with them is just going to become more common. >> julia, iger on apple's board in my mind is a legacy of the steve jobs era, jobs very fond of him, the pixar deal happened in part because of him, how important a voice do you think he is for apple to have on the board and what happens if he steps away >> reporter: well, look, i think bob iger is revered as a very strong executive, one of the best executives in the media business and his perspective on the transformation will be very valuable in the media business. it's worth noting that no one seems on the apple side of things seems to think that iger will have to step down but he must have valuable perspective on just the way consumers interact with content and services, you know. i can't imagine that he wouldn't be a very valuable perspective there but it would be interesting to see how this all

transpires. obviously what apple tv plus is for apple is a much less valuable piece of that high than how important disney plus will be for disney. we'll see what happens down the line, but i'm sure they'll be other questions asked about these relationships. >> yeah. both also like to use the plus in their names, too disney plus and apple tv plus. thanks for wrapping all of that up for us, julia. how the most recent ipos of 2019 are doing. let's get a check on the markets. we got red arrows but off the lows of the day. the dow's down 104 points right now. almost completely due to that 4% drop in boeing right now. the s&p is fracturalerly lower. we got more "squawk alley" after this break.

a slue of notable down graids and what could be in your portfolio and what to do with those stocks. we'll debate the moves to make as the market attempts to hit new highs. the former dallas fed president richard fisher joins us as well. the fed under file as you know. should jay powell and company cut rates? should the president stop unloading on the central bank? we'll ask mr. fisher at noon and that's about ten or so away. we'll see you then.

big name companies heading to the public market in a cup of weeks including pinterest. we'll take a lk h ty'ooatowhere doing. feel that? that's the beat of global markets, the rhythm of the world. but to us, it's the pace of tomorrow. with ingenuity, technologies, and markets expertise we create the possible. and when you do that, you don't chase the pace of tomorrow. you set it. nasdaq. rewrite tomorrow.

mno kidding.rd. but moving your internet and tv? that's easy. easy?! easy? easy. because now xfinity lets you transfer your service online in just about a minute with a few simple steps. really? really. that was easy. yup. plus, with two-hour appointment windows, it's all on your schedule. awesome. now all you have to do is move...that thing. [ sigh ] introducing an easier way to move with xfinity. it's just another way we're working to make your life simple, easy, awesome. go to xfinity.com/moving to get started. welcome back to "squawk alley. 2019 proving to be a big year for ipos many tech unicorns are on deck and pinterest is kicking off its road show today. joining us with more is our own bob pisani

bob, it looks like at the high end of the valuation based on the amended s1, $3 billion less than their latest funding round. >> and pinterest got the memo. they got the memo from all the lyft drama that we had people are arguing, what's lyft doing? valuing it 50% above the last round of funding, close to $22 billion. lyft was $15 billion and i think they saw all that drama and now they come out at a valuation on simple market cap about $9 billion and the last round of funding was $12 billion. this is great news why? it's great news for all the people who are going to buy this stuff. remember, 230 ipos coming? this is an awful lot of product to dump on the market. we want -- it's buy low and sell high we want the stuff to be priced reasonably and you want the stuff to have a nice move to the up side. you want people who are buying in the retail investors to make a little money down the road i think this kind of valuation sends a message that they're listening to that.

i think the chances this will be a much smoother ipo without all the drama. big up, big down it's a lot greater right now and by the way, the other ones, lyft is the anomaly. we've had eight ipos since levi's strauss they've done well. levi's strauss did well. gen fed. tradewind markets is up 30% this year pretty good returns so far lyft is a little bit of the anomaly. >> but did lyft put a wet blank oets the rest of the ipo market? levi's tanked the day that lyft really went down and now we have got pinterest coming in with this very modest valuation >> yeah, it definitely moved the overall ipo market down. lyft was the bellwether at that time but now, again, you see with pinterest going on, i think they've got it, and i think it's going to be a lot smoother also this debate about how much money all these companies lose it's true pinterest lost money

along with everyone else but the numbers aren't that bad. $756 million in revenues last year and losses only $63 million. i understand they were profitable in the fourth quarter of last year that's a good sign you can at least make an argument there's a path here to get out of profitability that's just on the valuation side there's an argument here that you can make the company is looking pretty well. i love it when you see -- remember the fellow we had on last time. the last round of funding doesn't matter that may be pick up my ears a little the last round of funding does matter, even if it was in 2017 pinterest was june of 2017 so i think this is sending a really good message to the overall market they've got it together a couple this week, a couple big cybersecurity firms, pager duty, these are smaller companies but in very hot spaces i bet they'll do well, too overall, i think the ipo market is opening up really well where

it's prices are generally rising >> is that one of the key takeaways for investors anticipating this that profits do matter and even if you aren't making them and aren't profitable right now this idea of losses narrowing and a path to profitability >> that's the classic story. remember what happened in 2000 they didn't are revenues or a path to profitability. that's a bad way to look at things reasonable pricing, too. they'll put up a lot of difficult path to profitability for a while. but if things proceed to be overpriced right away, then you have all sorts of problems you see this drama associated with lyft. >> do you get more frustrated if we hear -- >> that doesn't mean an awful lot to me. you'll always hear this. this is a lot of broker talk this is really big all sorts of stories about this. i don't put a lot on that. i want to see after market after the first day of trading, does it hold up like levi strauss held up nicely

profits were fine. they expected it it's still pretty good, john >> is it >> it's not that bad it's fine. >> i understand it went down on lyft because they'll all get killed if everyone perceives this doesn't have any value long term, they'll get out. that tells you an awful lot of momentum people in this market that's what -- this whole action with lyft in the first few days. and i don't know what went on with that short selling story but there was an awful lot of people who just dumped really, really fast and didn't hold on maybe we need people with longer term but it tells me it's a lot of stuff that's out there and a lot of people aren't so sure how it's going to hold up. so everyone has become a momentum player these days, and that's a bit of a problem. >> take away for the broader market >> it's doing fine look, today we're getting clobbered because boeing is down vix was at the lowest levels of the year on friday s&p up seven days in a row close to an all-time high. if you can make the argument

that europe and china is bottoming, we'll have positive earnings results this year but that's a big order europe does not look particularly good to me on the economic numbers china, they are turning around china's market, up 30% the shanghai is up 30% this year six months ago, could you make that argument? the chinese were furiously stimulating their economy, really worried things were going down it still doesn't look that great but it looks like it's stabilized somewhat. >> bob, thanks an exciting week next week dow's declines are almost entirely boeing's. s&p down aboutiv fe points we're back in a few moments. now there's scotts thick'r lawn, the revolutionary 3-in-1 solution for weak lawns. with a soil improver to strengthen roots! seed to fill in gaps! and fertilizer to feed! the result... up to a 50% thicker lawn after just one application.

♪ ♪ now yard time is our time. this is a scotts yard.

once again the list of downgrades today micron, boeing, southwest, starbucks, harley, roku and then, of course, ge, which is trading close to the lows of the session here steve at jpmorgan goes to an underweight from $6 to $5. >> yeah, again, talking about free cash flow that investors are underestimating the severity of the challenges and underlying risks at ge. this stock has gotten ahead of itself the worst performer in the s&p >> i will note apple is on the cusp of cracking 200 bucks a

share for the first time since november it is up 26% year to date back on top, remaining there. market capwise ahead of microsoft by -- >> hasn't seen 200 since november less than 80 cents away. let's goet to the judge and the half >> i'm scott wapner. stocks march toward new highs. does a deluge of downgrades mean it's time to take a rework of your own portfolio it's 12 noon this is the "halftime report." >> boeing, ge, micron, roku, starbucks, southwest, clorox, harley-davidson, all get downgrades what does it say about the stock market this is the s&p comes within 50 points of an all-time high plus, widely followed and very influential former fed man richard fisher on the president's call for quantitative easing, rate cuts and whether herman cain an