going. >> happy thanksgiving. >> you too nice too see you again. >> apollo management, i see some activity looking to the upside. >> bed, bath and beyond. >> uber get in on this dip. >> european equities to keep playing catchup. >> ihi. >> good stuff, thank you all thanks for watching. "the exchange" starts now. thank you, scot, and welcome to "the exchange. i am brian sullivan in for kelly today. here's what's ahead. more new highs for the markets random but interesting it is the 24th new record for the s&p 500 this year, but is this run maybe just a smoke screen for more trouble ahead? here comes bloomberg, the former new york mayor officially entering the presidential race he's got the cash, but does he have a real shot and the oil debt threat, the staggering numbers around one of america's largest industries can the debt ever get repaid, or is a huge round of bankruptcies ahead? that is on deck. we'll get to it. right now as always, let's begin

with today's markets more new records and a very happy guy after the 49ers big victory last night over the green bay packers. >> that's right. those 9ers are looking pretty good anybody who said they were soft they're paying the price this morning. the headline today, like you said, we're going to put stars up the stars next to the s&p 500 and the nasdaq composite because those are the two indices that have hit record highs today in the session. the s&p at one point is up by seven at the lows. we're right near the session highs. your new high water mark 3131 on the s&p 500. what's happening with small cap stocks there's a bit of a breakout today. it's not a lot, but still, if you can take a look at the s&p 500 versus the russell 2000 these two etfs, the s&p 500 we know has been on track 25% gains so far on a year-to-date basis if you take a look at the small caps, they're playing catchup right now.

we'll see if that plays out bullishly, and then the stock of the day nvidia, why? because it's the new 52-week high, the best level since november of last year. and by the way, nvidia shares up 4.5% today on an analyst upgrade. remember, this is an industry that has moved with trade and right now back to these sky high levels, so we'll see if that's a bullish trend overall for the markets. brian, i'll send things back over to you. nvidia, certainly they have been the 49ers of the stock market, dom, thank you very much. investors love a good deal, and apparently they like some big deals today. nearly 52 billion worth of m&a announced across retail, finance, and health care if these mergers are any indication, companies are clearly flush with cash, but they seem to be looking to buy growth rather than invest in their own growth in fact, capital spending by s&p 500 companies grew by less than 1% last quarter. let's talk about that and frame it on market highs joining us now chris harvey,

head of equity strategy, and mike clarfeld, managing director chris, your s&p 500 target is currently below where the s&p 500 sits does that mean you think the market is going to go flat to down the rest of the year, or are you going to raise your target >> so our price target is 3088, and no, i don't think we're going to raise our price target. usually when we get to the level we don't say okay, we're out what we do is we look around and we say okay, is the market bullish enough what do we see that can drive it high sner we thought the market wasn't bullish enough we needed to see more m&a activity and we needed to see more resolution on phase one, and we're beginning to see that. for the first time in a while, we told clients to start taking a little bit of profit do it slow, do it methodically

at some point we're going to have a turn, and maybe it's going to be related to trade and tariff. >> what's been really amazing about this markets is some of the participants, and unwith of the stocks that you love has been on fire, apollo global. we know them as a big private equity firm, stock's up 74% this year is that sort of indicative of the overall market good growth, low rates, and any kind of hunt for yield you can get? >> yeah, i think there are some similarities driving apollo that are driving over things in the sector or in the market. you named a bunch of them. so low rates is forcing institutional investors to allocate asset managers, which is driving good growth and flows. the stock market and asset values being higher is marking up the price of their investments, which is good for them, but there's some unique things too the biggest unique things with apollo or the alternative manager space in general, several of these companies have converted from partnerships to corporations which has increased

the universe oaf of investors. >> they opened the door to more money coming in. >> the second thing that makes them unique is they have a relationship with a life insurance company where they're the exclusive asset manager of atheen, and it's essentially permanent capital. >> what's the biggest risk to the market right now no trade deal? brexit >> the biggest risk, i think, is this would not be very -- trump has a tendency when things are good, when the market's up, when sentiment is good to start pressing his bets, and i wouldn't be surprised for him to say, hey, the chinese aren't really coming to the table with enough let's talk about this in 2020. and i think that would take the market off sides everyone is now thinking, oh, the trade deal is done or phase one is done. everything's good, and you roll the clock back 12 months ago, you know, the wheels were falling off the card everything was bad, but the market's up 20, 25% since that time, now that everything's good, we start to worry. we're of the opinion we're not

happy until we're unhappy, and when everything's good we start to worry about the bad we think trade and tariff could possibly be that reversal or could start to change market direction. >> okay. another name that you like here, and one i've heard of, comcast, apparently they're a very solid -- of course they're our parent company, folks, comcast is the parent of nbc, but there are reasons to like them other than cnbc. >> other than just the terrific talent they have on stage. >> you're welcome back anytime. >> what we like about comcast, number one in a market where it's pretty hard to find attractive values, comcast trades at a reasonable valuati n valuation. 15 times next year. >> i thought cable tv was dying? >> a lot of people do tend to think that cord cutting is a theme and something to watch, but for comcast it's offset very meaningfully by their cable systems business where they're getting a lot of growth on the high speed data side there are still a lot of people out there who don't have cable internet who have copper or dialup or whatever, so they continue to get growth and subscribers from that, and they

have pricing power the last thing is, obviously, disney just launched disney plus last week and everybody's got their over the top bundles that are proliferating. nbc you is about to launch their own called peacock in the spring we actually think it has a good chance number one, the company has a big network or a big group of subscribers already they can market to, and number two, they're going about it in differentuated ways. it's also ad supported so it will be cheaper and we think that differentiates. >> it's kind of weird how it comes back to abc and nbc. >> i like your picks apollo and comcast. thank you very much. now to the other big story of the day, and that is uber british regulators dropping the hammer, revoking its license to operate in london. regulators citing a pattern of failures from uber that place passenger safety and security at risk uber will continue to operate while it appeals, but if it ultimately loses, its biggest

european market goes away. joining us is the senior equity analyst are morningstar and our own deirdre mow is a tell us exactly what the heck happened in uber in london >> uber's problems in london, they started back in 2017, and that was more of a corporate governance problem it was travis kalanick that was at the he helm. what's happened now, uber has received these 15-month extension, a two-month extension, and then last night they did not receive the extension at all so as you said, they can continue to operate but what hangs in the balance is their most important european market, and what is different this time around than 2017 when that license was initially revoked is that these are operational failures it's no longer about corporate governance they have apologized, tried to make things right, but the technology still isn't working for them the tfl cited 14,000

unauthorized and uninsured trips, and that is a big problem for uber. >> it certainly is does it change morningstar's view on the equity you guys have been bullish it's been a very difficult story for investors. this could be a gigantic blow for a company that's already under attack on a couple of levels >> it could be, but we think the chances of that are pretty slim and to answer your question, no, it actually has not changed our bullish view we still value it at $58 a share. let's take this into consideration that it's still pretty much a new market out there when you're talking about ride sharing yes, they've been around for a while, but the adoption of that, whether it's on the consumer side or whether it's on the legal side and/or the cultural side will continue to take time. and during that time, of course, there's going to be additional adoption and/or adjustments required by the company, especially uber. so we think with more patience for some patient investors, it's still very attractive. >> the stock just continues to go down on nearly a daily basis.

>> yes, unfortunately. it's not yet -- it's not yet profitable i think the market is penalizing it for that, but we do think that it will continue to make progress towards profitability, and we actually do think from a gap standpoint, it will become profitable in 2024 so in our opinion, the catalysts basically include as additional indicators towards progressing towards, towards profitability, whether it's on the earnings calls or whether it's increasing demand in the ride sharing and so forth, they will basically help the stock possibly make some recovery and progress towards that $58 that we have for these guys. >> deirdre, i know -- >> you've talked, we all have the same thing that's going around here, the same keyboard sharing. i know you know the ceo and you talked and did these great interviews talking about profitability in four or five years is there anybody out there saying that at some point uber is going to have to make some hard calls about its cash flow >> yeah, certainly, and i'd be

curious to know how you think they actually get there if that's gap profitability by 2024, and you say that investors need to be patient, but look at what's happened in london. that license was revoked back in 2017, and that has opened that market to other competitors, which just brings back the ride sharing play book, which is subsidies, fighting for drivers, for riders you've got ola, bolt via van, how do they get out of here even if they're seeing some market rationalization here in the u.s. where there's only two players, itself and lyft, how do they get there in other markets, especially with all these changes in london? >> good question, actually, we think the main reason they could get out there in the other markets is that network effect, what we refer to as mote source that they have in fact, that network effect in london specifically has demonstrated itself. as usuyou recall in 2017 they fe a similar situation for different reasons, and the license was suspended. however, the demand remained very, very strong.

so we do think that they're going to remain the number one or number two player in that space, which means demand is going to remain high, which means the network is going to remain high, which means that rationalizing in terms of pricing that we saw in the united states, although may take a little more time, it will come about in london and also in other markets. also, i mean, keep in mind, you know, in q3 when these guys reported, they certainly demonstrated that network effect and/or that market leadership they have. that rationalization in pricing we talked about. the sales and marketing expenses as a percentage of revenue declined significantly, and it's actually going to continue to decline, we think. so they're not necessarily needing to spend as much time acquiring the riders ors drivers. that's one of the many reasons we do see these guys becoming profitable. >> we've got a big appeal to watch for in london. big story there, thank you very much. we are just getting started here on "the exchange.

here's what else is ahead. coming up, former new york mayor mike bloomberg enters the presidential race adding another name to the democratic ballot. who could he steal shares from and will he woo over wall str t street plus a, look at two names that could be the next takeover targets in retail. and the ripple effects of frozen two's success have you ever worked with dr. francis? this is "the exchange" on cnbc guess who just got reinstated! well, not officially. nervous? yeah. yeah me too. don't worry about it, we'll figure it out. i'll see ya in there! just ok is not ok. at&t has america's best network, now with our best plans, at our best prices, starting at $35 a line for 4 lines. new from at&t.

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former new york city mayor michael bloomberg is officially in, announcing he's running for president. >> mike bloomberg for president, jobs creator, leader, problem solver it's going to take all three to build back a country >> so how will bloomberg one of america's most successful businessmen and someone who has unlimited cash disrupt the race for the white house. cnbc editor at large, i worked at bloomberg for many years and know him in a professional sense. john, i will start with you. does mike bloomberg have any chance of getting the democratic nomination >> i think it's a small chance, but i've learned over the last couple of election cycles not to take my predictive ability too

seriously. it's an experiment mike bloomberg is going to try to skip the first four primaries which are iowa, new hampshire, nevada, south carolina, which traditionally have launched people into the center of the competition. he's going straight to the very large landscape of super tuesday on march 3rd a lot of those are southern states where he doesn't have a natural constituency there's california and massachusetts in there of course there are other massachusetts candidates in the race, so i think it's a very tough go for bloomberg, but he has a lot of money he has a strong record as a business executive he's got a strong record as mayor, whether he can translate that with a lot of ad spending into democratic constituency, i'm skeptical, but i'm not ruling anything out. >> i think that's well said. james, listen, here's the reality. those of us who know mike bloomberg or his company, i mean, he came from nothing in medford, massachusetts, single mom i believe and then built

this billion dollar fortune. was a good mayor in new york city according to most people, that's polls, not my editorial. michael bloomberg is kind of a name for the majority of the country. how does he breakthrough, and also, how does he get into the debates? how does the process actually work? >> bloomberg is out to defeat donald trump by defeating elizabeth warren first i'm not sure that either one of those will work. his strategy is shock and awe, and john called it exactly right. this is a science experiment to see if national tv, on three species in a row when two-thirds of the democrats are up for election can, you know, whether that can overcome a grass roots campaign he may actually benefit by not being on the debate stage because he's the guy trying to dominate the message, and yet no one can attack him on stage. no one can pick on him the way the other democrats toned piendc on the front runner. he's like the wizard of oz

standing behind the curtain. >> i think the overarching goal of mike bloomberg is, first of all, to prevent elizabeth warren from getting the democratic nomination i think the moment of why -- >> what's the issue there besides the financial wealth tax? >> i think that's a big part of it i think many people on wall street believe that elizabeth warren would go too far, interfere too much in the structure of modern capitalism to the detriment of the economy. i think that's why deval patrick ended up getting in the race he's been working at bain capit capital. he's in this world, he's not a market fundamentalist, but he's a capitalist i think there was a lot of anxiety about elizabeth warren's rise i think in the first instance he will try to prevent her from getting the nomination secondly, if as is likely, he is not the democratic nominee, i do believe he will spend a lot of money to defeat donald trump, whether it's on advertising

against trump, i don't think whether or not he gets the nomination and wins the presidency is the true measure of the goal of his campaign. >> yeah, because his company as many of our viewers probably know makes money when wall street does well they buy his computer terminals. if things turn down because of wealth taxes or transaction taxes, maybe the company could suffer as well listen, you talk about a mike bloomberg, nobody came after him harder this weekend than the democrats. i mean, you look at the comments on the anger verse, which is twitter, and it's almost like because he's a billionaire he's automatically disqualified for running for office >> yeah, the push back from the left has been extremely hard just look at the comments from the current mayor, de blasio himself. they really don't like bloomberg in the race because he's out there to blunt, indeed to eliminate, to blow away warren's progressive message about destroying private equity, breaking up big banks, the wealth tax and so forth. the problem is, though, that

once he blows the field wide open, can joe biden run up the field? can amy klobuchar come up with a message of her own i'm not sure >> what about deval patrick, john quickly. we haven't talked about him at all. >> deval patrick has some of the concerns bloomberg has he just doesn't have the money. >> he's also running for vice president. >> he's a very impressive guy. he's a very talented guy, capable guy. many people thought he had a strong case for getting in the race much earlier. very difficult to do it at the end. as i said earlier about bloomberg, i'm not going out on a limb on predictions this time. i think deval patrick has a very small chance, but i wouldn't write it off completely. >> yeah, look at the attacks on deval patrick, a widely loved sto sort of governor for massachusetts, and he worked with bain capital for a couple of years, and everybody says he's a private equity guy. amazing how the tide shifts. james and john, great discussion. coming up, put a ring on it,

is lvmh buying tiffany the beginning of a takeover trend in retail. and why the huge debt loads in energy aren't a big issue, they are a huge issue thwi staggering numbers that you've got to hear ahead. mmm... good. so i've spent my life developing technology to help the visually impaired. we are so good. we built a guide that uses ibm watson... to help the blind. it is already working in cities like tokyo. my dream is to help millions more people like me.

hi everybody, and welcome back to "the exchange. here are some of the big movers at this hour it is official, sharls schwchar

buying td ameritrade that union will create a brokerage behe mut that is sending shares of td ameritrade up 6% another big deal, this one in pharma, swiss drug maker novartis is acquiring u.s. based the medicines company. shares getting a shot in the arm, those shares up 22% right now. and if all this talk has made you hungry, how about a square hamburger. we are seeing shares of wendy's up more than 2%. they got an upgrade to buy at stifel nicolaus. remember, wendy's is rolling out breakfast all day at a number of stores around the country. that's enough with the stocks and the move, lets find out what else is happening in the world outside of money and business. we'll get a cnbc news update with sue herera. here's what's happening at this hour, everyone. in japan, pope francis is calling on world leaders to

rethink its reliance on nuclear power, calling nuclear weapons immoral. the pontiff met with victims of the 2011 fukushima nuclear reactor disaster. antigovernment protesters clashed with iraqi police in baghdad's historic rahish street security forces used tear gas and gun tire to disperse the demonstrators. the disney sequel took in an estimated $130 million domestically ahead of the 127 million expected, and if you add in the 228 million in international ticket sales, "frozen 2" has the highest grossing debut of any animated film globally. and a new study warnings toddlers are getting too much screen time. researchers at the national institutes of health found 1-year-olds are spending 53 minutes on average in front of screens. while experts recommend avoiding

d digital media entirely for kids under 18 years old good luck with that. that's the news update this hour >> clearly the researches of that study have never flown. >> have never flown with kids. >> here's an ipad, don't cry for four hours thanks appreciate it. all right, here'ses what else -- here's what else is coming up on "the exchange." ahead, "frozen 2" could be red hot for one retailer losing pinterest, can the company's new strategy help get the stock back on track? and ad touchdown for fox. and a big dogre wnadfor netflix. it's all coming up on "the exchang exchange". he started believing things that weren't true. but i didn't say a word. during the course of their disease around 50% of people with parkinson's may experience hallucinations or delusions. but now, doctors are prescribing nuplazid.

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all right, let's get caught up on a few stories that need to be on your radar it is time for our favorite part of the show. that is rapid fire here with our takes on the big stories, leslie picker, and contessa brewer. let's talk about wells fargo downgrading netflix shares to underperform, fancy word for sell and slashing its price target by more than 40 bucks to

265. the cost to acquire new subscribers will be more expensive, while increasing competition will keep spending levels elevated too. if they'd listened to need ham a year ago, they would have gotten on this band wagon there's a growing chorus of retailers that are starting to worry about competition and cash flow. >> that's the question, when does this start becoming a story about cash flow and start becoming a story about subscriber growth. that is what the street has been focused on for five, ten years with netflix is the streaming wars enough to actually get that -- enough of an investor base over the hump to say, you know what? actually, we kind of need more from you on the cash side of things you know, this isn't worth it for me anymore so far that bet hasn't paid off. >> big gap there, though he's essentially saying he thinks that over the next, what is it five years there's going to be a $9 billion hortfall. so $18 billion difference in what this analyst is saying

versus the street. it's going to be at least $2 to become preferable. >> can they raise rates at 20 bucks? >> they have some really easy things to do, and the analyst points this out too. one, they could crack down on this sharing of passwords. if you look at how many people are logging onto your, what, $12 netflix account, does that make a lot of sense when they could put it down? >> what would be the disincentive to do that? >> they haven't done that. they could also spend less on content. right now they're making it rain with the dollars. >> all these producers have made like one show in their history we were on the wrong side of the business, guys we need to make one hit show then you get a $200 million paycheck. >> netflix is pointing out that still linear tv is a way bigger monster than they are. it's still a goliath >> can they raise rates at 20 bucks a month? i don't know next up, pinterest announcing a new push into shopping all ahead of you guessed it. the holiday season the company unveiling the

pinterest shop featuring hundreds of products for more than a dozen small businesses. it's also testing a shop tab at the top of home feeds that include customized shopping suggestions. i'm not going to lie, i understood none of what i just said contessa brewer. >> pinterest is about sparking creativity it's a about how do you plan your kids hot wheels party. >> do you use it >> i have used it, yes. >> two questions, what is it, and is it good >> it's pictures that other people think are really popular. and is it good -- >> of like what? a flower or a shirt? >> i just got lost on their gadgets page where i found hands free shoe covers so that you can go from inside to outside without actually bending down and doing anything with your feet sounds fascinating right but do you think you can click on it and buy it no you cannot, and that's what pinterest is maybe thinking this is a place they can monetize it.

by the way, my colleague saw it, went to go follow the website to go buy them. pinterest is not getting a cut of that at all. >> it is hard. a lot of times you'll look for something and it will show on pinterest, and i don't know what pinterest is either. i'll keep clicking to buy it, you can't buy anything >> now they're trying to fix that. >> we segued out of the story for the streaming wars and everybody's asking for your eyeballs can you do them both i wonder do you sit there -- you're watching succession or whatever it is, and then you've got your phone here is that what we're all doing now? >> yes >> can pinterest break out of a crowded space? >> i think that's the question, and that was my first question. >> every time i ask you a question, you come back wiat me with a question. >> answer the question of the question >> now i don't even know what i was going to say, etsy. >> everything i say, answer the question picker. >> etsy. how is this different than etsy? etsy is a place that you go for inspiration, small business.

>> it is similar >> and it's somewhere that you go for kind of that small business homemade feel. >> etsy is the pinterest of crafts >> etsy is the pinterest of crafts. >> except etsy stuff is for sale, and on pinterest it's an idea board where it can spark other ideas. if you want to buy it and not diy it. >> you know what we never talk about, which is honestly my favorite website, is hows. >> it shows you what other people's bathroom looks like. >> it's got like a steam room. >> it shows you the price tag and who makes it, and also there's an option to buy it. hows has done it right. then there's this, another dominating debut for disney "frozen 2" hauling in $130 million over the weekend in north america making it the third highest grossing ever for an animated film the debut having a rippling effect with ubs upgrading hasbro's stock with a buy because they make and sell "froz

"frozen" dolls not actually frozen dolls but dolls from the movie "frozen." maybe you could freeze them also and they would thaw later on you have young girls were you there >> not the second movie. this is what was interesting, my daughters were cleary part of the "frozen 1" generation. i went to birthday parties where it felt like three years where every birthday party was a frozen theme then they hated it >> it was over exposed. >> way over exposed, and so they had no interest in going to this second movie, and so i thought maybe it wouldn't do as well apparently there are enough new "frozen" entrants that it did do well. >> apparently nothing's doing well there was an article, all these box office movies, they're all failings, but "frozen" was the one that did well. >> it was supposed to do 100, 140. it's 127 it's doing well within expectations, and i think it's

going to do great. this is one of those mega franchises that disney will keep pumping out movies and do fine i do think it's going to take continuous generations. >> i like that they recycled their characters we've got olga, rudolph. >> olaf. >> rudolph who's that elf >> that's sven >> he's got little kids too. >> you never watched this with your children? >> my daughter's a teenager. >> on hasbro one of the reasons they're doing well is they bought entertainment one which brings them more licensable characters it's kindergartners that are ruling the world right now what do they want for christmas? it's all stuff that -- >> we just heard sue herera tell us don't watch television if you're a little kid. we're getting sold on one side and told not to do on the other. >> and all in the competition. >> i know some people that are going to be having kids soon. >> do you? >> it's going to be an interesting world out there. >> see how much tv they watch.

>> only cnbc >> that is the question. amazon unseating apple to earn a top spot in the druker institute's 2009 management to 50 list. the annual list of america's best run countries using five metrics to determine rankings, customer satisfaction, employee engagement, innovation, social responsibility and financial strength amazon apparently boosted by its innovation ranking scoring more than double than any other company on the list. >> but then the other areas they were lacking far more than the other companies that you saw in that top five list, so they scored really, really well in innovation they scored really well in financial strength, but less well on areas like social responsibility and employee engagement and customer satisfaction, whereas when you go down the list, you look at microsoft and an apple and an alphabet, they did pretty well in all of those areas. >> any east coast companies on the list >> are there east coast compa s

companys >> unless they include innovative selfies, i don't understand why amazon's ceo. the innovation they described was the importance of memos. amazon's been can doing that forever. that's one of jeff bezos's signature management strategies. i don't understand what they did that was new this year that brought them on the list. >> if you read the books about bez bezos when they started to get big, what he did would not be okay now he would send e-mails to random employees, like what the bleep is this. can you imagine getting that from your ceo and founder? >> he would often say it's the dumbest idea i've ever heard to people. >> that's why they didn't score well on employee engagement. >> i thought employees weren't supposed to get engaged. finally fox announcing it has already sold out of ad space for this year's super bowl the network citing robust economy for drawing in advertisers, plus a new plan to air one fewer commercial break

per quarter during the big game. some 30 second ads have repo reportedly been selling for as much as $5.6 million. >> it's misleading they said there would be less ads per break, but there's actually going to be -- the breaks will be shorter, but it's the same number of ads. >> oh, it is >> it is ultimately the same number of ads. >> they add a quarter to a five-quarter game. >> each block will be longer, but there will be fewer of them. >> fewer breaks, longer blocks >> i think they're already experimenting that because these commercial breaks in football this weekend felt very long. >> remember, if they're cutting out one of the commercial breaks it means that the most valuable time slots, when you're leading into the break and coming back, that they have fewer of those to sell and by the way, if you're already sold out, does it mean that you should have charged a higher price >> yes >> i mean. >> your demand was -- >> or it could be they're sold out but maybe they'll still take some. >> let me ask a sports question. do you think this is on

expectation that it's going to be tom brady and his final football game ever >> oh, don't look at me for the sports question, brian. >> good question >> good question, brian. let me ask you a question about that what is it, brian? >> that's a good question. i think it's going to be -- i think it's going to be tom brady's last game, and i think they're anticipating that. also, will there be political d ads? will mike bloomberg run a block in the super bowl? >> interesting that it doesn't matter we don't know who's going to be in the super bowl. we can guess, but we don't know who's going to be in the super bowl, yet they've already sold out the ads, which is interesting because it really doesn't matter. >> it's a good economic sign and we all just watch for the commercial and not tb 12 anyway. >> i do. in the halftime show. >> you're just hoping your chiefs make it, then you'll watch. >> then i'll watch. >> little baby in hand. >> ready to go. >> patrick mahomes picker. >> finally, a glass of wine in my hand. >> you deserve it. >> thank you very much >> leslie, robert, and contessa.

>> victory goes to picker again. >> there was a big issue in the oil and gas market that is creating have, have notes and have nothing according to industry watchers it is the debthrt,nd tea a you've got to hear some of the staggering stats we've got coming out next. one of the products i helped develop at 3m was a more secure diaper closure. there were babies involved... and they weren't saying much. that's what we do at 3m, we listen to people, even those who don't have a voice. we are people helping people.

rowithout the commission fees whand account minimums. so, you can start investing wherever you are - even on the bus. download now and get your first stock on us. robinhood. i'm a regular in my neighborhood. i'm a regular at my local coffee shop and my local barber shop. when you shop small you help support your community - from after school programs to the arts!

so become a regular, more regularly. because for every dollar you spend at a small business, an average of 67 cents stays in the community. join me and american express on small business saturday, november 30th, and see how shopping small adds up. welcome back, the numbers really are staggering. the u.s. oil and gas industry has around 200 to 250 billion worth of total debt, and much of that comes due in the next couple of years. he let's break it down by type of company. the exploration and production companies are in the worst shape. they've got about 93 billion in debt due services companies, they owe relatively modest 31 billion, and midstream companies, the pipelines are in hock for about $72 billion. the industry's total debt across all years is about $600 billion, which is nearly half of the industry's total sales and more than ten times more than the

industry's entire net income think about that so far these companies have been able to ride out the last two or three years, but it gets serious beginning next year when the debt bill begins to come due it's not just the big number that's got the market spooked. it's that most of this oil and gas debt is junk rated, okay the purple at the top, that's the lowest rated debt in the industry the gray and green, these are all junk rated debt. now, that matters because it makes it more difficult, more expensive or even impossible to refinance or extend the maturity of the debt like many companies did back in 2016 now, that debt load along with stagnant oil prices and the pressure on many funds to sell fossil fuel company stocks have absolutely destroyed energy investors. the average return for all onshore oil and gas stocks in the past year is the drop of 38%, many are much, much worse, and this may be the most incredible stat of all because that stock dropped along with the negative weight of all this

de debt, has the combined market cap of the 55 biggest onshore oil and gas stocks that includes exxon, chevron and other names you know at $400 billion less than the expected valuation of one company, saudi aramco, look at that the entire onshore industry one company. energy stocks have never been more hated and, debt is one big reason now we're joined by michael bradley, managing director and senior director at tudor pickering and holt i'm not trying to pile on the industry here. you know, it's a severe situation. in 2016 companies were able to refinance or extend the maturities of a lot of this debt because oil was in the upswing will they be able to do that this time? >> it's going to be difficult. i mean w e still look at the market right now, the crude oil markets are probably going to be about 6 to 700,000 barrels over

supply going into the first half of next year, so this debt issue is not going to get any better it may not get worse, but it's not going to get better. like you said, there's 75 to 80 billion of debt that's coming due over the next two to three years, and roughly 25% of that is really, you know, guys that are the have notes, you know, where yield and maturities of debt is low single-digits, you know, high -- low single-digits, low double-digits. i mean, so you're just going to see, it's not going to -- it's not palatable, and there's just really no game plan. you need to have higher oil prices or there's going to be a big, big issue next year there's going to be more brup s bankruptcies for sure. >> duno you think so or do you think these companies can hold on? what i understand, the banks they're not interested anymore they were a couple of years ago, but even they're getting out of the game. >> yeah, what you're seeing is some of these banks that are in -- are lending, you know, to these companies, they're looking to pull out of, you know,

lending, number one or number two. the redeterminations they're doing is really, really strict some of the oil prices they're putting on right now, you know, for lending for reserves is in mid-40s, and with gas prices in the low 2s, and so what you're seeing is some of these banks on redeterminations are going to be seeing their lending requirements going down by maybe 10 to 15%. that's just not a good setup that's a setup we didn't have back in 2016 >> no, there's about 240 companies that are publicly traded that are in and around oil and gas in america according to s&p 130 of them have net debt to ebitda more than two times, i mean, that's high, and you think about the fact that more than half the industry has that but let me find some silver lining here, mike, which is that many of these stocks are also down 70 and 80% in a year. at what point does it get flushed out or have we already gotten flushed out >> loolk, there's a bifurcation

going on in the market guys with net debt to ebitda greater than 2.5% are the have not companies. guys that 1.5 ebitda are the ha hafls. diamondback energy priced $3 billion worth of debt at 3.5% or lower that's pretty favorable. that's what you're going to see going forward. we expect that's going to continue for the next six months at least. >> is there any place to hide out for our viewers that are looking for a bargain? >> at some point the stocks either bottom or disappear >> look, we think we're in the seventh inning of this decline, maybe the eighth inning. we have an opec meeting coming up here. you're not going to -- one of the things we're telling our clients is we need to see demand improve, and right now the supply and demand is out of balance by at least 6 to 700,000 barrels. that's going to provide a lot of headwind we're telling people to stay in

the conocos, the diamondbacks, eog pioneers, and the guys that are the have notes at this point in time, the names like chesapeake, an ter roe, whiting, oasis, stuff, guys like that, that is not a secret, and those are companies that have been beaten down over the last year, some of these names 60 to 80%. >> chesapeake has a selective default rating from s&p. by the way, ironic, mike we got a go that opec widely hated in america for 40 years may be the one group that can sort of rescue the u.s. oil and gas companies. if they can get prices higher. michael bradley, thank you very much. >> you're welcome, brian up next, a look at two analysts' calls that are causing big stock moves that might have flown under your radar who are they why are they moving? we cth aall at tease we'll tell you the answer after the commercial. radar. we'll tell you the answer after the commercial it's going to be a week before they can get through on these roads shhh, sorry, i didn't catch that. i said ask how soon they can be here right now? what's now? he says they're surveying our property now they're probably at the wrong house

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welcome back let's get some calls now that might have flown under your radar for whatever reason. raymond james saying investors are concerned about website that are too relienant on google services to drive traffic. it's also mitigated by the focus on customer loyalty.

bed, bath and beyond climbing as well on a positive note from bank of america. merrill lynch maintaining a buy rating on the stock citing its under presappreciated turn arou story. the company will have long success in future. coming up, with lvmh set to buy tiffany, we'll look at other retailers that may be ripe for a take over. that's next. it is nice. his haircut is "nice." this is the most-awarded minivan three years in a row.

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joining is senior real analyst. oliver, it's always great to see you you. i know if kryou come here it's because we have the holidays, a big deal or a combination of both let's start with this deal do you like it was it fair price for tiffany and what does it say about the state of retail generally? >> we are excited about this deal is it fair price it's at 135. that's fairly modest luxury stocks can trade and

transact in a much higher ratio. it's a good deal for lvmh. what tiffany really brings to lvmh is the engagement business, the diamonds, the supply chain and those are huge factors for the long term and what lvmh brings to tiffany is little more privacy and engaging in changing strategy which is innovating stores and product they are both good aspects for the acquirer and the target. it's america's last luxury brand. there's a lot happening. >> it just got cold here and i feel like i'm the only person in manhattan that doesn't own a $1,000 canada goose jacket everybody seems to have them >> yeah. that's another great global brand. as we think about the future, the future is these vertically integrated emotional brands. canada goose has a lot of great

greb ingredients. it's highly functional it's globally distributed. these brands are highly attracti attractive we're seeing this dynamic of consolidation in the marketplace. companies look for younger generation and the cost of debt is very low. beautif beauty has been on an acquisition spree. eye, lip, face works with influencers. we see a lot in luxury at large. we call that other brand like

burberry and others that could be targets >> we're watching these brands we're watching canada goose and eyes, lips and face. our pleasure new records on the s&p 500 and power lunch begins right now three mega deals worth tense of billions of dollars uber's london road block the city eliminating the license to operate and could be first shoe to drop later, the historic harvard yale game disrupted as students storm the field to protest both schools investment in fossil fuel companies should they cave to the pressure we'll dig into that.