amazon set to report tonight can he hold on to the top spot we'll find out they'd have to have a bad day. that's the finale tomorrow. >> our producer said amazon would have to drop 30% thank you for watching "power lunch. hello and welcome to "closing bell" i'm sara eisen at the coca-cola post at the new york stock exchange. a strong earnings report the overall market, though, turned lower in a volatile day 59 minutes left until the close. we'll have a look at what is driving the action earnings front and center with a number of sharp moves in names like ups, facebook, and tesla. the coronavirus epidemic continues to put pressure on sentiment that the w.h.o. declares a global health emergency. the big driver will be amazon earnings after the close

just one of a slew of companies reporting this afternoon but before that, live interviews with dirk van de put and michelle and joining house is stefanie link. good afternoon to you. main factors the coronavirus virus weighing on sentiment but earnings having a big effect. >> it is both are big obviously the coronavirus we don't know the implication for global problems. are we going into a recession or not? we'll see slower growth. no doubt about it. i don't think it's recession but the bond market kind of seems to be disagreeing at this point. earnings also, i think, is somewhat weighing on the markets because some of the bellwethers

didn't live up to the expectations you mention it and sara mentioned a couple of names and you mentioned the names, as well, will facebook, 3m, ups. those are big names and they're disappointing, for sure. on the flip side, we have great consumer staples up your alley. and i can't believe some of the numbers we're seeing. >> yeah. 3% for coke. >> they're welcoming you back. >> yeah. i guess so. >> yeah. it's not just the strong consumer those are examples of better performers in the overall group. >> yeah. they have done an aggressive moves over the last several years investing, reinvesting, cutting costs and starting to see the results. it's great to see, i mean, i own a few of them. i wish i owned more, frankly they are putting up good numbers and the evaluations are not nearly as expensive as they have been they're still expensive but not as much. >> a deep dive into the sector to come. interviews with both of them let's get to meg breaking news on the coronavirus. over to you, meg

>> reporter: the world health organization declaring the coronavirus outbreak a public health emergency and international concern. as part of that declaration, it said it's not making recommendations to restrict travel and trade in fact, they say the declaration of such an emergency gives them the ability to question countries that put those kinds of travel restrictions in place to dig deeper into why they are placing them seemingly to say they do not recommend putting those -- they are not making recommendations and, actually, seem to recommend against putting those in place we have news this morning from the cdc confirming a few first cases of human-to-human transmission in the united states it was the husband of a confirmed case in chicago. she had traveled back to the united states from wuhan, china and he, as her husband, lived with her and in close contact. they are both currently in the hospital and we hear are in stable condition, guys so the news moving very quickly and we'll bring you anymore we get. back over to you. >> meg, what is the emergency

mean then? >> reporter: it gives the w.h.o. the ability to make recommendations and to work with countries to try to strengthen their public health response they say they do not recommend those restrictions on travel and trade and are questioning cases in which they have been put in place. they also really emphasize that the declaration is not in response to the way china is responding to the outbreak they went out of their way to commend china on its response. in fact, they said it's because of concern that the outbreak could spread to countries weaker health, sara. >> thank you let's dif into the other big stories. mike san tolhas the dash board d julia has details on facebook's live over to you. >> obviously this pullback we've seen in the market in the last little over a week did coincide with the concerns about the

coronavirus outbreak also, a flatter yield curve. take a look at the 1-year chart on the s&p 500 here is the map out where we are in this flattening out and choppy process in the market in is about a 2% drop from high to low we're coming off a high merge. we had two year highs in evaluation and in sentiment and how far the market was technically stretched to the upside so this was, you know, leaves the question as to whether it was to relieve the pressures today we were bouncing off monday's low it seems like you could say this was a reset. in the late november and early december, that was about a 2.5% pull back on the way up. if it is deeper, you have a room all the way down there to, like, a 5% high-to-low decline before it's anything more than a pullback in 2003 when the w.h.o. dedeclare an emergency for sars, it did happen to mark the bottom

but different. here is the 3 month to 10 year yield curve. as you can see, it's slightly negative we were negative for much of last year. there's the zero line. a little bit below it. couple of things to remark here. one, we first went below it last may. it did, in fact, coincide with the start of a 6% pull back in the s&p 500. we cannot stay weak through the entire time. the market rallied back to a high in july while we were negative so some people think it starts the clock on a recession watch maybe it does. maybe it doesn't there's nothing specific about just getting to negative that says something really different has changed by the character of the models. >> that said, mike, as stefanie mentioned earlier the move in the bond market suggests that some people are more bearish about the impact of the virus than other equity markets participants are. >> i would say that is certainly is true. all though, also, you can't discount what it says about inflation expectations we see this commodities bleeding low every day. so i think the combination of global yields being i did

pressed because we expect, obviously, a slow patch, if nothing else, this quarter as well as that disinflationary concern waring on you. >> there's a lot of buying after the fed yesterday. >> yeah. >> mike, thank you shares of tesla hitting a record high today building on gains after last night's earnings phil le bow has more >> reporter: a huge move it's about the guidance and a huge 2020 that is expected from tesla. they raised their guidance in terms of how many deliveries now expecting to deliver more than 500,000 vehicles. china production will be ramping up and then you've got the model y delivery starting later this year add it together, you can see why elon musk is excited he admits the big concern right now making sure production is there. >> we're not too worried about demand we're worried about production making sure we can get the production ramp going and reach production as soon as possible. >> here is something for elon musk to dance about.

the fact their market gap, tesla's market cap now is more valuable than the big three combined yeah that's right more valuable than the big three combined tes the analysts are along for the ride in terms of changing theirest mates check it out a year. generally in the range of 150 to $4 $444 the stock has taken off, they have tried to keep up. some of them still haven't gotten close they're in the range of $200 there are some almost as high as $710 think about that, guys a huge move in terms of price targets for tesla. >> and, phil, clearly there was a bit of a swipe on the call to what some of those analysts and institutional investors who have gotten it wrong. you can't blame him to that credit for the extraordinary

year but not in the clear yet the fundamentals have some questions. >> sure. there are people questioning whether or not they can execute. look, it's clear there is demand for tesla vehicles as china comes online, they're expecting big demand there it's a big move to go from one to two manufacturing plants. doesn't mean they can't do it. tesla has been able to meet the goals they set there maybe not as quickly as they originally set them out but they eventually get there and elon musk is believing they'll eventually get to where they're expected to be or where he expects them to be over the next couple of years. >> on the market cap point, phil, i guess german automakers -- i'm looking at it now. bmw is about 85 or 90. still ahead but not all the top three globally combined. >> no. he's not as much as the top three combined it's toyota number one and tesla and now volkswagen in third.

i'm talking his combined market or tesla's combined market cap is more than the big three in the united states combined >> yeah. >> that's crazy. >> extraordinary. >> does it make sense to you >> no. i mean, they evaluate product. they have the demand execution is still iffy, as phil was saying at this evaluation, it's really outstanding at this point. i get the growth i get the total addressable market i get the story but i don't get the evaluation and giving him at hoff credit to execute. >> one of his successes, relative to the u.s. automakers, is global demand. >> yeah. >> a lot of mason u.s. brands don't have much sales overseas not chrysler, for example, buford and gm. >> i read an article this morning that one analyst thinks they can have earnings power of $35 to $40 from $2 i mean, in the coming years. that's astounding. >> another big earnings mover today in the opposition

direction. facebook is worse since june the stock following sharply. losing around $37 billion in market capitalzation wow. julia has more >> reporter: that's right. facebook shares down 6% as investors respond to the zeal rating growth. particularly in the u.s. for facebook earns the highest revenue per user and facebook cfo warning that revenue growth will continue to decelerate in the first quarter. >> factors driving this deceleration include the maturity of our business as well as the increasing impact from global privacy regulations and other ad-targeting head winds. we experienced some impact from the head winds today, the majority lies in front of us >> reporter: barclays saying the quarter was solid but not good enough investors anxieties may get the best of them in the near term. morgan stanley recommend they buy on weakness. nearly out -- we have noted six

have lowered their price targetings and there's one downgrade. back over to you. >> julia, thank you so much. a big mover today. certainly weighing on the tech communications services sectors. amazon highlighting another huge day for earnings that'll be coming up after the close. so we'll have analysis and all the numbers later in the show plus, how trade tensions and the coronavirus are expecting mondelez we have famed investor nelson pelz is today's closer. he'll be joining us here atthe exchange g owomg us bish cinup 3- v and boom, it's got all my favorite shows right there. i wish my trading platform workedthat. well have you tried thinkorswim? this is totally customizable, so you focus only on what you want. okay, it's got screeners and watchlists. and you can even see how your predictions might affect the value of the stocks you're interested in. now this is what i'm talking about. yeah, it'll free up more time for your...

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if. the coronavirus impact has been at the top of mind for crow ceos the last few days the term coronavirus has come up 25% of the 177 companies that reported so far. mondelez the maker of oreos and others saying the virus could hurt sales in the first quarter but the stock is soaring today after beating fourth quarter

earnings joining us now is mondelez chairman and ceo dirk, which was the land time mondel mondelez soared 7% off earnings? >> not bad. >> there's a lot for investors to like. in all segments beat on the margin what is driving this kind of growth that is is a standout in the industry >> well, umm, in the snacking category and the category is doing well compared to previous years. snacking is up versus previous years. people are snacking more we see it around the world and then we saw very good growth in the u.s., north america, china, india, literally everywhere we saw good growth except maybe for latin america so it is sort of across the board. our biggest brands are oreo,

milka, cad bury almost up double digit. also our local brands doing well it's sort of the strategy we put in place is working. it's investing more in business and it's coming together at this date. >> you mentioned, china, it's a key market for you just give us some specifics, if you could, about how your plants and consumers are being impacted by the coronavirus. >> so we're in snacking and the chinese new year is quite an important period for snacking, as you can imagine we put up big displays in store and people buy a lot online. what we've seen is the run up of the chinese new year was quite well selling into the stores was slightly above what we were expecting up up to the moment the media started to talk a lot about the coronavirus, we were selling out quite well, also and the last three days before

chinese new year, the news was very heavy and consumers were invited by the chinese government not to go out in public places, to stay home, limit the chinese new year celebrations so it's a bit early for us to tell right now what it has done to the sellouts. but we expect it will have some affect the other thing we're seeing is people are coming back after the chinese new year nationally going back to work we have four plants in china two of the plants have been asked to remain closed an extra week so that's going to have, also, a small impact at this stage, we can't tell we are not super concerned with it. if the crisis continues and the consumers start buying less, it does have an impact, probably. >> when we consider the overall full year results and the strong numbers that you delivered, is

there a sense in that that the health crazy we've seen in recent years has peaked and a oreosout performed last year is it a case of the opposition and the innovations you're delivering to make snacks healthier are what drove the beat >> i would say it's not neither one of the two it's largely that we are investing more and investing better doing better marketing of our key brands we haven't really seen a huge shift in consumer snacking between indulgent and health and wellness health and wellness grows a little bit faster. about 6% and indulgence grows about 3%. 90% of the snacks in the world are indulgent snacks that sort of balances out. if you look at the effective dollar growth in indulgent snacks, it's always been higher.

what we're seeing is acceleration in our key brands and in our global brands through the marketing. that's really what is going on right now. >> how much of a cushion do you have in that guidance you gave for issues like the coronavirus or brexit, which i know will be a big deal for you, as well. >> yeah, i mean, we're a global company. we're in 160 countries around the world. we know that something will go wrong. last year it was our supply chain in brazil. china is about 4.5% of our sales. brazil last year with the problems we have there is more than 5% of our sales we absorbed in 2019 that shock we're sort of ready for always something being of if several things come together, it would be a little bit more difficult. as it relates to brexit, we're not exactly expecting in 2020. we assume the european union

will negotiate the deal with the uk over the year and that as we approach the end of the year, that deal will be in place and the transition will be smooth. so we're not expecting this year a huge brexit impact but if it would be a hard brexit, it would affect. >> i'm curious about the supply chain issues in brazil that was the only glitch on the quarter in my mind when you reported this morning. so are we behind the supply chain issues or where are you in terms of fixing that >> brazil is improving it had a bigger impact on our quarter three results and quarter four we looked better. it's not completely behind us but we i think we did turn the quarter and seeing the improvements we'll have to confirm that in q 1 and q 2. so far so good, i would say. and i think we're improving. >> i'm seeing a newsreel hitting

the wires right now that you guys have officially broken or created a new guinness world record for the most people dunking cookies to celebrate $3 billion in oreos how did you do this? >> well, first of all, oreo passed the $3 billion mark this career we wanted to celebrate that. i don't know if you're familiar with the oreo ritual, but normally you take the cookie, you twist it, you lick, and then you dunk so we took 5,066 in 50 locations around the world who all, at the same time, dunked their oreo into the milk. that's what we did that's a guinness world record [ laughter ] >> that was for you, wilfred. >> i hate milk i love oreos and will eat them on their own but milk is scary whether what is the difference between double stuff

>> the filling is the best. >> there you go. i want to put in a request i don't know if i should be asking this but free cad buries. we have is a double cadbury duo. anyway. >> yeah. yeah. >> yeah. >> dirk, thank you. >> yeah. we appreciate you coming on. >> thank you for having me ceo of mondelez. >> up next, the word on the street why a major company is getting downgraded it's not because of the coronavirus. plus, another uptake on the health of the consumer when we're joined by the ceo of hershey. back in a couple of minutes. how well does your financial advisor know you? if they saw you on the street would your advisor recognize you? at ameriprise, we see you as more than a client. that's why our advisors care about what's important to you.

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welcome back goldman sachs to neutral citing head winds by muted hotel room supply growth. they noted in competition from google as the tech giant is expanding the product sweep for travelers. the stocks up about .7% today. >> and piper sandler out with a note on the mattress industry. saying it's the most bullish market in years.

the firm citing a healthy consumer industry ad spends, irrational competitive backdrop. the mattress start up got sent to ipo next week, though, actually it was less about casper and more about the other ones like serta, tpx, leg. who knew bold market for mattresses. >> fancy market. >> i think it's interesting given what they're doing tinge c -- digitally. they're the big player in the industry so if i'm going play one, that would be the one. >> what about at&t and that kind of traditional safe bet with media but pushing into more aggressive areas and not getting -- >> heavy investment spend. you don't want to own a company when they're heavy in investment spend. same thing with at&t or amazon or any company i'm surprised at the dividend yield and where it is. >> very high. >> very high you can collect that and not

care, really there are other places. >> all right we have a little over 30 minutes to go. the dow briefly turning higher this hour. here are the three things driving the action besides that. earnings front and center with a number of big moves on names like ups, mondelez, hershey, facebook, and tesla. the w.h.o. declaring coronavirus a global healthy emergency and the big driver will be amazon earnings a of the the bell just one of a slew of companies reporting this afternoon time now to get a cnbc news update with sue herrera. >> hello here's what's happening. defense secretary mark esper discussing traumatic brain injuries calling it the unseen wounds of war. his comments come as he responds to criticism of the pentagon's reporting of injuries from iran's missile strike earlier this month. >> the department will be providing update on tpi numbers later today. but late distress we take this

issue very seriously d.o.d. is a leading contributor in the treatment and research of brain-related trauma we do everything we can to identify, treat, and help our service-members recover and return to duty. >> tokyo prosecutors obtaining arrest warrants for carlos ghosn. one is michael taylor. one of the americans met with carlos several times in japan while he was out on bail and a light show featuring the british flag was beamed on to brussels' main scale. britain will depart the eu at 11:00 p.m. in the uk and midnight in much of the european union. you are up to date that's the news update this hour back downtown to you. >> all right is that because they're celebrating getting rid of us? >> i think it's -- >> celebrating the last day. >> i think it's a fond farewell.

i think it's nostalgic i really do. >> good. they're getting a light show but big ben is not ringing. >> they'don't bring up the big n thing again. >> oh, i know. >> thank you let's get over to mike f. >> these are the results visa is one of a elite class of stocks in this market that are kind of in charge. especially on the growth side of things stake a look at the analyst settlement approaching visa now. it's pretty bullish. as you would expect, it's been an amazing performer and you see about 90% of all analysts recommending you have a decent spread up to the price target from the existing target. that is not necessarily been a majority opinion to fade, as you can see. this has been consistent kind of core holding now look at the evacuatievaluate the step function move that has gone on in the last several

months so a lot of these kind of reliable high cash flow stocks these are reliable double digit growers are up in the range now toward 30 times earnings it's pretty aggressive only about, i guess, about a 11 year history of visa right now it's by far and away the expensive as it has been maybe that's a head wind for the performance down the road. i want to class it with other stocks over the last couple of years that have gotten a lot of investor attention in dollars. you can see this is visa it's pfizer square and s&p global they're not all charge card companies. they're not all electronic payment companies but essentially data networks of one sort or another. the software platforms in their valued as such it happens they're up almost the exact same amount over a span of the s&p 500 is up about 15%. clearly right now anything that took -- looks like software data base platform, everyone loves it. >> yeah. >> also, reminds me that square

late '17. >> yeah. that's the one that hasn't been so smooth. >> right and ended up in roughly the same place. thank you, mike. we've got 28 minutes left of the session. at the moment, we're pods on -- positive on the dow. the s&p is not far we're essentially at the session highs. nice i arecovery in the last ho or two > coming up the last chance. find out how nelson peltz is putting money to work in this environment. whether he thinks g.e.'s recent rally proved the comeback of the company is for real. as we head to break, a quick check on bonds another down day for treasury yields buying bonds 10 year treasury yield slipping to 1.57%. a bid for safety, perhaps, on the worsening virus and chance the fed may cut interest rates this year. "closing bell" will be right back

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shares of hershey popping on the q 4 earn pgs the company beating the top and bottom line as well as forecasting better than expected sales for 2020 the candy maker rallied by nearly 50% in the last year. they continue to satisfy investors. it's up 4% today joining us for more cnbc exclusive is michelle buck good afternoon to you. thank you for joining us. >> good afternoon. it's pleasure to be here. >> talk us through in the u.s., if we may start there, what really drove that better than expected top-line growth and the health of the u.s. consumer you're seeing. >> yeah. so we're pleased with the strong 2019 that we had three years ago, we set apart three strategies to accelerate and transform our business one of those was to accelerate our core confection business that ended up the year over

2.5% we delivered close to 8% eps growth a lot was behind convicting with consumers and unlocking our core brands our reeses franchise, which is $2 billion was up 6% payday up 8% kit cap -- cat over 2% it was a lot of good promotions that connected with consumers. strong innovation and very tight cost management, as well, that enabled gross margin expansion. >> you mentioned -- >> in addition to -- >> yeah. sorry to cut you off i wanted to ask about pricing. you mentioned the word promotions i think a lot of analysts and investors want to know what you're doing in terms of pricing. i think cocoa has been inflationary. >> so we did take price increases in 2018 and 2019, and we feel good that we continued to see growth across the franchise despite those price increases. we tend to invest a lot behind

our brands, and we know that's key to keeping them healthy. we invest in innovation behind the brands, for example, this past year we had reeses thins, which was a new way that consumers could enjoy a reeses that was a bit more permissible. we did a recent lover promotion which was do you prefer more peanut butter? more chocolate when i say promotions. a lot are about connecting with consumers on marketing ideas and they enable us to maximize the value proposition with consumers. >> in term was promotions, michelle, you're taking part in the biggest promotion event of all time the super bowl this weekend. talk to us about the particular angle there. >> yeah. we couldn't be more excited about the super bowl we have an amazing brand which is called take 5 it's one of the best-tasting brands with one of the highest repeat rates among consumers not a lot of consumers know

about it we took on an effort to rebrand that recent under the reeses brand. we'll be advertising on the super bowl, which is the largest captive tifrz 'tissing audience out there and making a little bit of fun of people who aren't aware of it because is the best-tasting candy bar i will tell you, it happens to be my personal favorite, as well mine is mr. good bar. >> we do still have that the indulgent portfolio. almond joy was up 60%. i think there was nice press about the candy drawer even at the impeachment proceedings and we've seen strong growth as we had our recent acquisitions of skinny pop and the one nutrition

bar. sk seeing strong growth in skinny pop. >> i'm curious, we had monday la monday less and you are similar stories on the street which is faster growth than the other packaged food companies. is it because of snacking as a category is so much stronger what do you see there in terms of the different performance of different food companies >> so, snacking is definitely a great place to be. consumers are snacking more and more they're looking for taste. they're looking for choice i think, you know, winning is definitely a big part of that is having brands that consumers love and i think we have those with meg brands like hershey $1.5 billion, a range of brands that meet different consumer needs. so certainly snacking is on the rise as the traditional meal

wanes. i think the more we can capture those occasions whether it's on big brands that taste great like reese or brands with a little bit of per missability in the savory space having relevant brands that are fun and taste amazing is key to the growth. >> michelle, thank you so much for joining us today much appreciated. >> absolutely. thank you. michelle there of hershey's. up next, your last of-chance trade. we're gearing up for the amazon earnings release at the top of the hour. y.% of the analysts say it's ckft ts. abu ♪ ♪ ♪ ♪

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60 minutes left for the session. we are at session highs. up 70 points on the dow. stefanie, what do you got? >> it's paypal the stock opened down 3% this morning and i bought some. i thought the quarter was pretty good i think the market is a mile

wide and so i think that this company with $13 billion in cash can continue to do m & a to fuel that growth and you have monozation, as well. they had 52 million members. >> that's definitely some potential, if they can successfully monetize this. >> yeah. making profits. >> 15 minutes left in the session. up next, uninterrupted coverage of the mie of the final minutes of trade. as we take you inside "the market zone. you met on an app. delete it. why? he's the one.

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commercial-free coverage of all the action going into the close. >> mike santolli is here to break down the crucial moment was of the day we have news on american airlines phil le beau has it for us >> reporter: pilots union filed a suit in dallas to stop the airline from continuing flights between the u.s. and china effectively, they want all flights stopped mainly out of concern of the coronavirus spreading and their concern about the health and well being of the crews that fly there. remember, american made the decision yesterday because of dwindling passenger loads it was planning to scale back flights between the u.s. and china starting on february 9th and going all the way through march 27th now the pilots are saying stop it now stop all the flights until they know more and feel more comfortable about the spread of the coronavirus and the health and well being that, you know, those crews might be exposed to

over there. >> and, phil, i mean, the fact this is being done by filing a suit i guess it mean questions assume that the pilots tried to campaign internally to their bosses to say please don't make us fly there and it was rejected or is it the way things are done >> let's be clear, the relations between the l.a. pilot's union for americans and american management has been frosty for some time. there's an element of that that is at play here, as well but at the end of the day, if you believe what we want to stop now that the union believes it's in the best interest of the pilots to just cut it immediately, then you don't want to see a gradual reduction starting out in february 9th and going all the way to march 27th. you want it stopped now. it's a combination of factors at play here. >> phil, thank you as we speak, session highs we've seen the dow and the s&p pop into negative territory. coca-cola is the leader after

posting in line q 4 earnings and a beat on revenue. coke zero has been a big driver of growth. so is coke coffee and coke energy will be featured at the super bowl this weekend. i spoke to the ceo about the quarter and the outlook. he said it's for a solid 20. he told me he believes the u.s. consumer is in robust shape and election years are pretty good for coke because people seem to have more money to spend during election years he also said it's too early to tell how big of an issue the coronavirus will be. they're still manufacturing in that country, he said, serving consumers despite plant closures and employees staying home stefanie, here is an example of a group that is thought to be so defensive and yet it's posting great growth numbers. >> terrific! cash flow up 37% year over year. they are hitting out of the park

here and i think the evaluation is a little more expensive than mondelez but i think the organic growth is little bit better. i own and like them both. >> i can see more vodka in the election year. >> generally having more money in their pockets whether it's through stimulusor the stock market i don't know. >> yeah. that's a broad commentary. i'm sure he's not bujtding for that it's more about, you know, it seems as if there's a little bit of a tail wind of a lot of economic activity. and the administration would try to maximize whatever is going on in the economy. >> session highs up 91% or so on dow with 8 minutes left. revenue was the hiss the company that makes cigarettes took a 4.1 billion hit in the fourth quarter on the

investment they expect the number of cases to grow. down about 4%. this investment, of course, into jewel wasn't a full acquisition but it's something that will be questioned. >> yeah. i mean, obviously right down to the investment it looked like it was ill timed and too expensive is the one thing the fact it's happening in the open-ended fashions. i'm sure it's one of the reasons the market is reacting. >> yeah. cigarette valolumes down. to me it was better than expected i just think it's too difficult. it does yield 7% that's something. >> yeah. and they get pricing still. >> yeah. i know meantime ups shares sinking after reporting a revenue miss this morning craig collins spoke with us with the ceo. >> ups is 6.5% year lower. missing on revenue that was just

in line. and q 4 the holiday peak ups reported year over year growth despite a soft industrial environment. the ceo sees commercial traffic growing in the second half of the due to the usmca. >> the next round of tariffs will be hasher on a lot of customers and it was the biggest concern. there is more positive dialogue. >> ups said amazon is now 12% of revenues it's a partner but ups is keeping it an eye on the e commerce giant as it scales up the own delivery business. back over to you. >> thank you i wonder if the reaction saying anything it's a global economic bellwether but it has been a better performer against fedex. >> absolutely. they actually performed last year much better than expected. i can see the pull back today.

if you look at 14.4 times earnings yield 3.5%. domestic volumes grew 8. .8%. there's good things here that said, they have to invest heavily. that's not going away any time soon the operating leverage gets reduced this year and probably next. >> the burden of everything delivered instantly is falling more on the package companies than it is on other parts of the value trade. i think that's the broad conclusion also, i didn't get a lift of the ups shares. >> over 20% over the last 12 months after the bell, we'll get earnings from amazon the key things to be looking out for. >> so, wolf, here's what is expected eps of $4.03 that suggests a top line jump of

19%. street focussed on margins how are they impacted by increasing ships costs as the company provides one-day shipping and amazon web services. analysts expect $9.8 billion there. they know aws as the biggest impact on amazon share price generates the fastest sales growth of the three operating segments and the company's profit center. back to you. >> thank you so much for that. mike, i guess over the last 12 months it's been questions of what is a legitimate multiple for this company whether it's because less profitability is the likes of walmart and target or the question mark in the marketplace as a whole. >> that is in people's minds, at least to some degree the idea it's investing and never really harvesting. i look at it as a free cash flow yield basis like 2.5% free cash on a trailing basis.

3.5 following. it's a little more expensive than the facebooks of the world. it's a big question. it has not traded well the market is trying to figure out a new evaluation rate. you know, the stock is $200 below the all-time high when the rest of the nasdaq were hundreds. >> yeah. >> the entire day actually the index is is a little bit stronger than underneath if you look at the updown value it's negative. if you look at the dow transports against the utilities this is is a global offense versus defense trade this is on a ten-day basis very wide spread there that's 9 percentage point performance spread between utilities and yield stocks versus transports. we have backed off back under 16 we were up toward 18 again before we are a little bit of a choppy environment but if it can recede

a couple more points, people will say, okay, it might be firmer footing. >> we're up 122. quickly, what caused the turn around >> entirely -- people say that's what we've been waiting for. let's be clever and play the sars play book. >> does it make sense? >> it doesn't make sense unless it wasn't really down on true fears. it was just down in the body language w.h.o yields did pick up, too. >> on the topic of yields. they picked up a bit but down significantly. >> yes you know, the big turn around in stocks had a dramatic effect sold at $142 yesterday the low today of two is 137. why is that important? open the chart to september of 2019, and you'll see why that $139 close would have opened the door from september of last year all the way back to

september of 2017. so you want to watch that area closely. and the same true for tens look at the october chart. $153 low we were at that level when we bounced. bertha this is the highest choice close of the week for nasdaq. >> it is and vehicle ares looking at this as a concrete step toward containing the coronavirus all day, though, we have seen the big earnings winners especially with their guidance tesla, lab research, and microsoft at all-time highs defying the market facebook with the rising costs looks to close at the worst day since june of 2019 and health care earnings losers were losers on limited guidance. but the line turning around here as the coronavirus impact trade is moving over over to seema. >> take a look at scrappers of carnal well off the lows of the

session. after italy confirming the passenger did not have coronavirus. [ closing bell welcome to "closing bell." i'm sara eisen. >> i'm willfred frost. after a rough start to the day. the market was in the red. there's the interday chart and the dow finishing higher just climbing in the final moments of trade there to settle out 123 points the s&p 500 also closing in the green. it's up about a third of a percent. also, saw the nasdaq tick higher did get the afternoon announcement by the w.h.o. the

coronavirus is declared a global health emergency but not banning travel or trade. maybe that was considered somewhat of a relief you saw groups like airline, for instance, take up on the news. yields followed, as well. >> yeah. interesting. financials picked up yields picked up even though oil slipped. at the bottom was communications services. >> earnings on the front seat. >> moments away from amazon, visa, we'll break down the numbers when they cross. it looks like amazon is down 3%. joining us is laura head of u.s. equity at capital markets and cnbc contributor stefanie link to the markets, i mean, utilities picked up, as you

said i think it's the best sector highlights that significant shift. >> yeah. they had pain in the last week or so. i think the reason the market did pick up with the announcement the w.h.o. is not going to ban travel. potentially less bad than we expected a little bit better news in terms of no incremental new cases all over the world i think it gives occasion to traders to say are we deserving to be down 2.5% if coronavirus was the main story here? probably not big things are context in the morning the s&p went down to monday's low. didn't break it. hung around. microsoft was holding up the nasdaq and essentially got the little bit of relief to give us a bounce in the afternoon. still closed below friday's close. so we're still talking about chopping around somewhat below the highs. >> take a look at amazon shares. up% 8% 21% sales growth, mike, how important is this?

>> it's important for amazon honestly as i said before, they've been in the big tech faang space. right now it's back up to near the old highs around 20.50 so, obviously, it's a big deal if this sticks, i want to point out we sometimes have a ethink on what amazon actually reported and what is going to happen down the road after they report numbers. last quarter we thought it was a blowout and under the surface, anyway. >> yeah. up 17% with apple up 100% last year. >> we'll get the details now. >> yeah. we'll get to josh with more color on the report. amazon reporting q 4 here $6.47. the street was looking for $4.03. a bit on the top line, as well, reporting 87.44 billion. analysts were looking for

$86.02 billion and looking for $71.65 billion turn to the segments north america 53.67 billion. and aws up better than expected 9.95 billion and looking for about 9.8 billion. back to you, guys. >> that's technologically important. >> yeah. it's by $100 million it's not where the beat came through. it's mainly in north america revenues overall mike, i mean, aws is key part for this particularly when you come to the market eps stands out even though the revenue beat was on aws. >> right when they miss -- earnings is a residual at amazon they didn't try to make a particular number. it was pacing of numbers and volumes and, obviously, when they were deciding to take the investment spending. but, obviously, massively reassuring to have that magnitude. it's interesting because aws it's kind of like apple blowing

out the iphone line. when everybody was focussed on services i mean, here we have amazon the core business. the old core business driving, really, the upside at least for this point. >> yeah. we were talking about the stock here you own shares. >> i do. it was relative to the other faangs we talked about how it lagged. but aws was 31% growth they did a little something like 33% growth in aws. obviously margins up a little bit better than expected you have the operating leverage. so i usually think that the retail side is actually -- oh, usually it's disappointing this quarter. everyone has such great expectations this is very encouraging, for sure. >> how is the fight back of target and walmart peaked in terms of how it drags down their margin have we seen the worse of that for amazon >> it's hard to tell

-- i think they're more competitive. maybe they can coexist i expect the numbers to be pretty good, as well. >> reading the quote from jeff ba -- bezos. so, you know, when they made the announcements and we were debating it would be a material boost to sales, it looks like this is the answer. >> right it is. you could imagine the same quote and the numbers not being that great and people saying great but it costs too much to do it i think, obviously, it does underscore, they believe, the strategy is certainly worth paying off but, you know, we'll see in three months. >> stocks up by some 10% on the aws point, are we starting to see the battle with microsoft at least come down a little bit a solid number there >> yeah. >> microsoft had absolute blowout on the cloud line, as well the line seems to be that it's

amazon and microsoft and then everybody else so it seems like the two leaders plenty to go around. at least that's the idea >> the whole thing we saw the growth rate of aws decline over the last year. and so it was an important number they should have either met or exceeded in order for that not to slow further and worry about market share. >> you don't necessarily want to own the stock in an investment year they already invested heavily last year on both parts of the business, by the way so now this year we'll see it could be less than last year. i've been actually nibbling a little bit but this is a nice surprise. >> how do you feel about the evaluations across tech when you see big blowouts from amazon, microsoft, as well, does that justify the high multiples well, look, i think the multiples are high i think investors tolerance for high multiples diminished a

little bit since where we were a year ago if companies are coming through, i think they'll get rewarded i don't think there's any free passes. >> another earnings report. >> amge nerks on the top and bottom lines reporting earns of $3.64. also, a blowout on the top line reporting $6.2 billion versus an estimate of just over $6 billion. the problem here, though, is the company's guidance seems a bit overly conservative. revenues are in line up $25 billion to $25.6 billion. earnings, though, light compared to the estimates now looking at 14.85 to $15.60 per share compared to $16.14 that's the estimate. one of the issues? higher cost. the company said that its

franchise, big franchise in rheumatoid arthritis sales beat higher net profits with unit demand falling in the meantime, it's new migraine drugs and expenses were up 8%. back to you. thank you very much. remains on the right-hand side of your screen you can see electronic ads is moving we'll have the numbers in a moment amazon remains up 9.9% we saw earlier how much impact it has on others. >> yeah. >> purely by the mechanics of it the qqq is up near lay%. >> yeah. >> trillion dollar company at these prices we're looking at now. it stays above $2,000 it's nice and clean. figure out exactly if we have another trillion dollars. >> yeah. >> not really as conveniently

pleased. >> yeah. >> how do you think about the evaluation of amazon >> it's hard so you to deal with some of the parts. that's kind of the way i look at it and i only own a few of these. the one use can't explain on evaluation in a portfolio. this one i think total address of a market is so huge it's worth doing some of the analysis. >> it reminds you when you see, yes, aws is a strong $10 billion or so. it's still a small portion of the total pie. we just talked about the overevaluation with amazon is pretty generous. >> yeah. they can flex their earnings at any time they can flex their investment spend. the sky is the limit you have to look at the total addressable market and how they're doing. any given year they're going to invest heavily or not. you want to own this stock in a noninvestment year it's still a heavy investment year but relatively less. >> amazon up almost 10% after

hours. julia has the numbers. >> reporter: that's right. revenues beating estimates by a hair coming this at $1.98 billion. and the number we look at is the net bookings number. the company's guidance for full year 2020 net bookings they will be approximately $5.1 billion. that sun changed it and pretty much in line with expectations and earnings per share are coming in at $1.18 but that doesn't seem to be comparable to analyst's expectations ea shares are up nearly 6% the company highlighting a couple of metrics showing their digital growth, in particular, saying digital net bookings for the trailing 12 months was up 50 percent year over year and represents 77% of total net bookings over to you. >> thank you mike, your thoughts?

had had a pretty nice run. this is the push/pull we'll have all earnings season. it's a good lift in the last three or four months. >> their slate of products is fiscal 2020, too so that's what we're looking for. not necessarily this year. >> right look at the snapshot the side of the screen there theers slightly missing. it's been a lumpy earnings season. >> yeah. today was microsoft. yesterday was apple. but that sort of managed the high bar and have investors worth them and you have your facebook on the other side it's not unusual to see that what is somewhat unusual to have $100 billion in the market value versus the company after the closing trade which is what we're seeing with amazon. >> yeah. a lot of big index effect but it's, i think we're still fighting it out on the market wide level in terms of are we still betting on the massive

growth companies that seem like they can deliver at will or is it going to finally be a little relief for the more -- >> i suspect facebook will continue to underperform you'll see money rotate out of facebook into this one. >> right. >> amazon lists everything they sold including their own products but we knew it was a good holiday season we knew shoppers came out and spent online and on amazon why the sort of disconnect with expectations >> because you absolutely never know what they decide to do with the money. they don't care about guidance they don't care about making sure analyst ta good sense i think this is what you'll see. when you have some one of the most wildly stops in the world and it can blind side the market to this degree because of that. >> it does. >> they say the best selling homemade devices issue the echo dot, fire tv stick, and alexa

voice remote maybe the best selling of their own products or across the board. >> perhaps of where they placed them. >> yeah. >> we'll get to the visa numbers. >> yeah. >> that's right. pretty much in line. 146 per share which is what analyzes are expecting on revenue. just a touch light there a slight miss on revenue also, announcing 9.5 billion buy back being authorized. payment have volume grew 8% for the quarter and on the call coming up, visa announced the 5.3 billion acquisition of plaid. we'll hear more about that on the call china, as well investors are focussed on music. guys >> all right

bouncing all around down 1% after hours. hue you think they're coming in and what it means for the direction of the market. >> i hate to use the word boring but it feels like it's a boring uninspiring earnings season so far. very, very mixed, as we're seeing with the results after the close today. i would say, frankly, we're not learning a lot that is new there's company-specific issues cropping up. but generally i think investors came into the earnings season wanting an all clear we're seeing signs let's get excited and continue the recovery trade we're just not getting it at this point in time i think that's why the virus has really been able to kind of dominate the tape over the past week you're not getting a lot to sink your teeth into for earnings season. >> yeah.

we'll dive into more into amidon's results and our interview with today's closer. republican the state of the consumer and investing and closing bell will be right back. i love the new myww program, because it's tailored to you! ...take the personal assessment and get matched with a proven weight loss plan. find out which customized plan can make losing weight easier for you! myww join for free and lose 10 lbs. on us! - [spokesman] if you've tried colleg(group cheering)shed, snhu lets you transfer up to 90 credits toward you bachelor's degree. - [woman] it doesn't matter how old you are, you can do it, you can finish. - [spokesman] finish your degree at snhu.edu

amazon shares surging over 13% now. good afternoon tom, what is your take on the number what stands out? >> the profitability if you look at the fourth quarter within we knew the first party retail effort did well on one-day prime. clearly the clock computing effort did incredibly well so i think that's the real standout of eps. >> what is your first take >> i had similar sort of look. i was looking for the one-day to see how it was faring for them it was an important push during the holiday quarter but aws is acounting for two-thirds of the profit overall it's for the year. the fastest growing part of the

business we tend to look at aws as the bottom line ad but look at the retail as the top line now aws is pumping both sides of that. >> yaems, what was your take coming into earnings any surprise to see such a big leap >> yeah, i mean, look. amazon was the most underperforming stock across the big tech what we saw is this is the only stock across big tech that saw the price of sales multiple decline over the last year down about a third i think what you're seeing now is a lot of catch up the other ones did see the multiple expansion leading into this if you drill down in numbers, yes, they were extremely strong. but, you know, online sales up 15% and you are seeing deceleration in aws. so those were things to look at a little bit further. >> what do you want to hear on the call >> i want to get a better read on, you know, they highlighted india. right. they're pumping a billion dollars into that region to help small and medium businesses get on their marketplace platform. haas what drives a lot of their

new areas. i would like to know how it's fairing. there's 40 million active fire tv users now so, you know, amazon prime has free video associated with it. the real upside for them is that upselling other streaming networks like cbs all access or nbc has the peacock thing coming out. i think you have a huge footprint. there's a way for them to get more into that marketplace being the marketplace for streamers as opposed to being a streamer themselves. >> the big profitability baeeat, clearly aws -- sorry the big probability -- we've lost them. excuse me, tom james, same question to you. it came from launching from aws beat but profitability in the core business. do you get the feeling that is sustainable and what is driving it >> yeah, i mean, look the core business, i think that's

discretionary if they want to pull the levers or not in terms of investment. aws i think is a little bit murkier. you're dealing with low asset productivity business that is prone to a lot of competition as long as you throw money at it. i think you can potentially see in increasing amount of pricing pressure as we go forward. that puts into question the level of investments they can make instead of logistics efforts. i think you saw a big beat this quarter but you know what we have to look at it is the precash flow potential in the coming quarters and the degree to which you can invest. what can happen is if they cannot invest in larger chunks today, you could see potentially the depressed earnings. >> so, tom, you're at 25.50 price target into the report where does that go how do you think about whether this stock -- it's clearly being rerated now 12.5% after hours where it goes. >> yeah. going into the big quarter is

how should we think about incremental competition in the cloud? you talk about the $4 trillion market caps. the commonality is three are cloud computing. microsoft, amazon, and google. so the big question mark is is a loss of jedi. >> thank you very much. >> thank you. >> $15 billion for jeff bezos after hours here >> yeah. >> do the calculations ly vie's earnings are out. >> a mixed quarter for tapparel maker. they were expecting 21 cents and came in at 26% revenue was a slight miss. company announcing $100 million buy back

initiating a dividend of 8 cents. they're shutting half of their stores in china due to the coronavirus a few months afterly vie opened the biggest store in wuhan. the epicenter of the virus the call begins at 5:00. we'll be on the call that's something investors will be listening closely to when the call kicks off back to you. >> thank you so much up next, we'll break down the chafrts and the retail investor sentiment is a red flag today's closer is nelson peltz. coming up, how he is putting money to work amid the recent volatility and what he makes of evaluations. as a reminder, you can watch or listen to us live on the go on the cnbc app. "closing bell" will be right back we are a 97-year-old firm built for right now. edward jones. it's time for investing to feel individual.

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we'll send it over to mike santolli for the third dash board of the day. >> it is the third thank you. the party in the market standing out a little bit the weekly aaii survey of investors asking if their bullish appearance on the market for six month time arises what you saw here from about a

two-year high a couple of weeks ago. we had a decline toward the neutral zone ander ror image increased in bears. you're seeing both but they have not completely unwound those moves. you center -- it's helpful and is only down less than 3%. high to low in the last couple of weeks you wouldn't necessarily expect people to get too desperately afraid yet this is probably things moving in line. still ahead the closer today nelson peltz coming up, his reaction to mondelez's recent rally. introducing schwab intelligent income. a simple, modern way to pay yourself from your portfolio. tell us how much you have, and how long you need it to last. we'll estimate how much you could spend.

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lower. hello everybody. here's what's happening at this hour the new ambassador to russia, john sullivan, paying his first visit to u.s. citizens paul way land who is facing espionage charges in moscow and has been detained there since 2018. saying waylon's health has declined and hasn't received proper medical treatment he's been detained now for more than 13 months. despite the russian government's immediate claims they caught paul, quote, red handed, unquote, the investigators have shown no evidence, zero. paul's case has gone on for too long shielded in secrecy and hidden from view. >> one lucky person in florida bought the winning powerball ticket for last night's massive jackpot! it was bought at a convenience store in bonita springs. the ticket is worth an estimated $397 million the winner has six months to

claim the prize. and fred silverman, the executive who became the only person in tv history to have headed programming for each of the big three networks has died. he was credited with helping to launch such tv hits as "all in the family" "the mary tyler moore show" and "happy days. he was 82 years old. back to you. >> okay. sue, thank you so much southwest airlines is under fire for reportedly flying planes with unconfirmed maintenance records. phil le beau has the story >> reporter: and this is an initial report from the inspector general has been looking into southwest, its relationship with the faa, and specific life whether or not all of the logs, paperwork, and other details that need to be taken care of on a daily basis have been taken care of. what you have is a report the journal getting hold of the initial inspector general report

and calls into question. we reached out to southwest. it says it maintains a culture of compliance recognizing the safety of our operation as the most important thing we do we reached out to the faa, it will respond directly to the inspector general when the report is finally issued and, again, as you take a look at shares of southwest not a whole lot of movement on the stock today. down 1.86% i'm not sure you can attribute that to this report or the fact we've seen the airlines having pressure for some time take a look at shares of navastar there's a report that volkswagen is looking to buy the rest of it it sewns -- owns 17% and interested in buying the remainder. you see the stock popping more than 40 cents. quite a move, guys. >> absolutely. thank you. up next, billion investor nelson peltz tells how the

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welcome back breaking news on ibm that news is in april chairman and ceo will step down been ceo since 2012. been at the company for some 40 years. before that, the new ceo ha will take over is the current head of the cloud software business that's arvind krishna. quite a significant move in the share price, mike, after hours >> yeah. its underpurchase -- performed significantly. >> yeah. quite like ibm to promote an insider. he's been at the company for 30 years or so. that makes sense the leader of the business that

has been trying to emphasis which is cloud, which is software to red hat and the rest of it. it seems it's taken as gesture of commitment or renewed commitment to that part of the business and so it seems like, you know, in a way you can argue following a little bit of the microsoft playbook. >> right. >> you're elevating the person who had been at the company for a long time running what is becoming the most important of the business. >> it's a double commitment in that direction with jim whitehurst being elevated as opposed to one leaving. >> going to be president and member of the board. >> yeah. >> was this expected >> it's not clear it was expected obviously, i mean, ginni had been ceo for eight years that's a perfectly, you know, long tenure for a large company. she's 62 it's not completely unexpected but i don't think the market was really in suspense over imminent succession announcement. >> share prices up 5%.

ginni lead the company since 2012. >> yeah. >> and what will be the legacy share price performance, anyway, clearly disappointing. >> well, certainly but trying to usher the company into the modern tech world and mostly enterprise, software, and cloud and build into those strengths as opposed to the legacy, which was much more in a press hardware which is when she took control. >> it's a strong statement with the two of them as to the future direction of this company. >> yeah. >> that could be one thing that investors are responding positively to. just looking over the last 12 months, even, the stock has barely moved. >> yeah. it's an extremely cheap stock and we've been able to say that for many years it's cheap and high cash flow. it's the idea, perhaps, and take away from the announcement that the metabolism of the company will change a little bit, you know, to be a little quicker maybe that's what people are -- >> it's interesting.

she's been out front on so many political issues to going to meetings with reskilling workers with the administration and representative of the industry she's in davos every year. >> yeah. totally unclear whether it's going to be the style moving forward. >> we'll continue to follow the stock move, which is up almost 5% after hours on news that ginni rametti will be retiring and stepping down as ceo on april more on that news and conversation coming up with nelson peltz on his portfolio. after the break. ♪ (vo) in every trip... there's room for more than just the business you came for. ♪ whether that's keeping up with what you always do... ♪ ...or training for something you've never done before. (crowd cheering) that's room for possibility. ♪

welcome back two massive movers ibm breaking news that gin ginni rometti is stepping down being elevated to president is james whitehurst head of red hat at the time of that acquisition. the stock is up 4% and amazon, of course, reporting numbers earlier in the hour and blowing past the particular on the profitability side up 12% crossing a $1 trillion dollars higher let's switch focus sara, over to you. >> mondelez was a big winner today. closed up 7% the ceo was with us weighing in on business and snacking.

>> snacking is up versus previous years people are snacking more we see it around the world and then we saw very good growth in the u.s. in north america, europe, china, india literally everywhere we saw good growth except maybe for latin america. so it's sort of across the board. >> let's bring in today's closing bell closer nelson peltz who has been in monday less for a long time. >> very long time. probably has a board seat. >> even before it was mondelez. >> right. >> very much part of the break up of mondelez and kraft. >> you chose mondelez. buffett chose kraft. >> we were criticized. >> why has it been able to outgrow the others >> you had a guy in earlier today probably the best executive in the food sector

and mondelez today is the best food company and when you look at food companies and snacking companies, before you get to the numbers, you've got to decide what they're selling and where they're selling it okay if you're selling liverwurst and hot dogs -- not great. but if you're selling snacks and you're selling them all over the world, then you've got a shot of winning. and dirk has taken this company and done a phenomenal job. >> if you look across the food space now of kraft, as i mentioned general mills, kelloggs, what is the problem? you've been following the industry for so long. >> first of all, all of those companies, other than mondelez, are north american central businesses that's number one. number two, their product line there aren't many people eating

condensed soups. so they all have challenged skus mondelez doesn't have any of that mondelez has got what i call acceptable -- i've got a lot of millennial's, right. >> your children. >> yeah. my children. they're my laboratory. i see what they eat. i see what they shampoo their hair with, and even -- i've got some fuzzy eaters. even the fusy eaters will take an oreo thin or piece of chocolate as a special treat they're not taking lunch meats i don't mean to pick on lunch meats. they're not having a can of chicken soup those are not acceptable indulgences. >> is it hart to find other turn around stories in food and bench? >> it's hard to find anything good now prices are so high

and thankfully interest rates are lower. but we only find a new name or two every 12 to 18 months. so we're not terribly off schedule. >> which brings us to ge, which is another big earnings winner this week. a name you've been in for a long time i think the top question investors have is the cash flow improvement for real >> you know, i will tell you the companies in our portfolio, mondelez, pg, and wendys we have the best ceos in the industry larry is a star. a real star. he's done an amazing job at ge and will continue to do amazing jobs in my opinion, i think that this is the first step toward many more good things at ge. >> specifically on the cash flow >> you know, earnings without cash flow don't mean anything,

sara they're empty calories that's the most important thing as far as i'm concerned. and, i mean, if you look around, people are willing to accept so many companies today that don't generate cash. number one, some that generate earnings it's a different world we live in. >> that's true a little bit. the rejection of wework and uber and lyft. >> i was talking to mike milken on the phone yesterday, and we were talking about the early days of the '80s he introduced these revolutionary phones with a first-time less than a-rated company could get financing on something other than a percentage on receivables. we were borrowing money at 15% and paying interest in cash. look where we are today. we have uber, we have lyft, we

have companies that people are willing to value in the multibillions that are generated our cash flow. >> is it bubblelicous? >> i don't think so. thank goodness i'm young and i can take advantage of the next wave you're laughing over there don't laugh! [ laughter ] >> look, we have to talk p & g it's been awhile since we talked it you claimed you had a win. they claimed they had a win. you've been on the board the stock has been a great outperformer and so is the business how much credit do you take? >> zero. >> why >> i just told you we have a great ceo in david we've got a great coo, cfo in john mueller

we've got a super management team and i mean that. i'm just not throwing it for the sake of it but what we also have is the structure. and the new structure is really first time really has accountability we have six ceos accountable from sales to ebit that didn't exist before it was a matrix organization. and now the ceos understand the whole income statement and what they have to do. and frankly they have responded way better than i imagined so i'm really excited about where p&g. >> we're on the front foot and going. i sent you a video i'd like to you play the video i'm now directing the show, okay i sent you a video i want to play it. you guys couldn't do it. >> they are playing it now.

>> when i was at delivering alpha. >> what are we watching, nemesis. >> look. >> can you talk us through it? >> can i talk now. >> it's on. >> your mic is hot. >> this is a revolutionary product line i've been around the consumer space virtually my whole life. and this is the most amazing product line i've ever seen. it addresses exactly where the world is going >> this is the waterless. >> no packaging issues, no plastic issues cuts down on emissions dramatically cuts down on transporting water to places you don't need and i don't mean a spokesman for the company. but this product line got me so excited when i saw it. i think it's going to be such a winner there is nothing in that package that doesn't biodegrade.

nothing. think about that when you're all done it's all gone. >> which is what consumers want right now. it's interesting to hear you talk about esg because that was one of my questions to you, which is how do you prioritize esg for companies and management esg has been part of our dna going back to the 80s. we had the biggest recycling program in the world at american national cam that's so important. in the 60s or early 70s when i took my first company public, my first cfo was a woman. and that doesn't sound like a big deal today but think about the late 60s and having a woman arguing covenants with banks that was. >> that was something. >> that was not traditional back then and governance clearly one share one vote where we are at and we don't own anything in the

portfolio that doesn't match that. >> governance. >> it's a big thing. part of what we believe in try an. >> do you pressure your ceos. >> they're so aware of it. if you look at the complexion of our boards we have more women, minorities than what's traditional. and doing -- and everybody is moving to do that even better. everybody understands environmental issues and they're all moving at different speeds to get it better and governance is governance and i'm on every governance committee in every company i'm on. >> you were in the audience when president trump signed the u.s.-china trade agreement you've been on the record saying he was doing brave things on trade. what are your expectations where it goes and how much progress we made so far on china. >> let me tell you something, if

we turn back the clock to 2015 or '16 and said we are going to sign a trade agreement with china and it's going to be phase 1. and by the way we will have tariffs in place while we are signing and after we are signing, people would have been wondering what cannabis you are smoking, okay. but the fact is it's true. this was a monumental effort and i do agree with trump. he has done amazing stuff on trade. i don't care whether you are republican or democrat, he has done an amazing thing on trade and just the other day he signed mexico and canada. look, his trade policy is right. he wants to do one or two nations at a time instead of a whole continent. because when you start to negotiate with asia, the needs of cambodia are very different than the needs of japan. and what happens is it winds up

to be the lowest common denominator. i think the way he approaches is the right way. >> even with tariffs you sort of mentioned that having tariffs in place is a good thing. >> i think it's a good thing to have them in place because we're going to phase two. >> it's leverage. >> he has a chip to play if he gave up the tariffs entirely -- he lowered some. if he gave them up entirely what would we have to negotiate in phase 2? that's the reason, my opinion, why the tariffs are still in place. and i think phase 2 will be another step in the right direction. we are doing things on trade, artificial intelligence that heretofore were thought impossible in nelson peltz always good to get your thoughts on a variety of topics thanks for coming? >> wilf back to you for the breaking news. >> thanks to nelson and great stuff. pivot back to the breaking news

as sarah mentions. ginny rometty stepping down as ceo of ibm to be replaced. rometty will continue on as executive chairman throughout the rest of 2020, retiring at the end of the year after nearly 40 years with the company. john fortt joins us on the news line clearly a share price pop on the news, the appointment of arriven krish ner and james whitehurst, a focus towards the cloud. >> very much so, wilf. this is interesting, i've gotten to spend a good amount of time with arvind as i aspen a good amount of time looking at the hybrid cloud strategy post-red hat. getting in the research organization and talking about quantum computing.

arvind came into the company i believe as part of tivoli. he has the security background as well and worked in deep technology in the organization and has also built out his business chops in that sense, similar to the move microsoft made years ago. elevating satya nadella who had been working on core technologies in cloud that she they viewed as important to the future that's underscored as well which putting whitehurst in the position as president. that acquisition which is a defining moment if you look back at ginni rometty's and arvind krish that was a big part of that as well. >> the shareholders are hoping that it will have as big a

transition as nadella did more microsoft. >> i had the same thought. it feels similar in terms of insider, somebody in the faster moving parts of the business we'll see. i don't know anybody is going to map that same path but that's the hope. >> john fortt thanks for joining us lisa he will ills from moffitt nathanson. tell us why you think the stock jumped on the news. >>s in a move that investors have been waiting for. a ceo change at ibm, something to reinvigorate strategy around the cloud. as john highlighted, arvind is a technology leader of company, very railroad deep technology background and -- and pairing him with jim, i think investors are particularly excited about the pairing with jim whitehurst as president, coming from red hat from an external point of view i like -- and i suspect many investors like this kind of concept of putting arvind in the

ceo and president role and bringing together both a longtime ibmer with an external person, their challenge is to try to catapult ibm's position in the cloud to a different trajectory than where it is right now. >> lisa this is clearly a statement by the company that red hat was a large and important and presumably they believe successful acquisition do you think that's the outside verdict as well? >> well, certainly outside verdict is certainly that it's a good strategic move by ibm cloud is a must win. if you are going to bet the house on something it's got to be cloud and red hat is a great asset. they've been partners for 20 years. i think the jury is still out and whether it's successful. certainly ibm can do a lot through the sales and distribution and customer base to accelerate red hat.

the question is about whether red hat, you know, can do enough to accelerate ibm. >> lisa, thanks for joining us we appreciate you jumping on the phone. ibm up 4% on the news of arvind taking over as ceo that does it for "closing bell." "fast money" starts now. live from the market site at the nasdaq over looking times square this is "fast money." i'm david faber. trader tim seymour karen finerman steve grasso and guy adami. and we kick off with two major stories. ibm up sharply on news that ginni rometty. stepping down and she will stay on as chairman for a bit we give you the breaking details on the story straight ahead. but we start with the earnings alert. amazon, touching new all-time highs, after a blowout quarter earnings and r