see that as a great thing to do to be the best in the world at electric vehicles. that's what we're going to be. >> mark, i know we have a lot more to talk about i know we'll catch up again at some point mark reuss, thank you for joining us from the plan back to you. i have one second. make sure you join us tomorrow "squawk on the street" is next ♪ . good wednesday morning, i'm carl quintanilla with david faber. cramer is out west at one market in san francisco futures on the cool side as the market keeps a wary eye on the new uptick in covid cases. retail top lines are strong, but

target's miss lowers. >> rivian's market valuation is doubling ford. after the bombshell report, new calls for the ceo of a activision blizzard to resign. the gross margin miss -- >> i'm frantically trying to get a better read on gross margin. that's what caused walmart stock to go down to 143. people do not want to hear that you ate anything they want everything eaten by the customer home depot is able to do it. remember the customer at home depot is the pro the propasses it on to you with

relative ease. lowe's i tcontinue he's been at it for a long time it shows that lowe's was dramatically undermanaged. there's so much room that it's the anomaly. >> you have to go back a wait for those. >> why don't they pat marvin ellison on the back? i had a talk with marvin where he talked about with george floyd at the stores, not with esg, but managing a workforce so everybody feels equal. managing in a way that is, david, i would say empathetic and empowering that's what we should be talking

about. not whether they're carbon neutral in 2075. >> well, something else we have also been talking about the power of the largest of the large retailers have in terms of taking control of their supply chain in a way that smaller retailers are simply unable to do. >> is there anybody left everyone has been defeated they're not in this business anymore. that's why home depot has good margins. no one is left to compete with the small towns have been wiped out. that's one of the reasons i think etsy is up 40% you can't wipe it out. >> i don't know, what about tjx? what about kohl's? >> you've been to tjx, i saw you go down the escalator.

>> i did. >> tjx remains a winner. people love a bargain. and, by the way, i always get my turkey. >> if nobody has any inventory, how are they getting stuff that didn't sell? there's nothing to tell to begin with >> there's always something remember, the stock was at 15. it's now doubled i don't know they do have travel restrictions coming oaf >> look at that move >> these stocks should never have been where they were. they were all reflectling -- can

we stop talking about supply chain sign >> well, we hope so. certainly container rates have come down yesterday the number of containers at the dock at l.a. port is down by a third >> and inventory up 18, jim, at target is mind-blowing numbers like that rarely happen in retail. last week we talked about the great over-bill. i think we're making way too much, and not talking about the incredible demand that makes it so that your issue is -- and david, we learned this from mickey drexler -- do you have enough inventory when they want all the product? the answer is no one has said they do. no one has said our shelves are b

bare. >> we used to call it the soviet safeway, where it had nothing on the shelves. >> rite aid doesn't have inventory. i don't know, they're terrible cvs has all the inventory you want. >> unfortunately in the cities, everything is under lock and key. i wanted a box of ice cream sandwiches, and you have to find somebody to open the freezer. >> you stop people and say, do you have the key and then try to find a checker and then you do the thing with the scan, one doesn't work, the thing falls off, there's no bag. i hate going anywhere other than to my door where amazon has the product. i'm going to order diet coke from amazon. >> really question, we talked to

doug mcmillen yesterday from walmart, and brian cornell at target echoed that this morning. >> we charted our own ships to make sure we could get inventory into the right position. we've working closely making sure we're off-loading our containers in off-peak hours, but really making sure inventory is in the system the inventory was up almost $2 billion. we want to make sure we have the inventory to support the incredible demand we're seeing. >> speaking of the demand. they guide for the quarter, comping up from about 9 to 11. i guess some folks are saying this morning maybe that could have been a bigger bump. >> oh, yeah. i saw some people saying, you know what, that translates when you have the numbers they have, all the people at home should be thinking of is, when can i buy these stocks

when can the froth -- when can the "fast money" guys -- not our guys, of course -- when are they cleared out? and when do you buy? there is no promotion, and that's where we should be talking about. no pricing promotions. david, promotions destroys gross margins. they can guide them up, and everybody will be happy and you'll say, why did i sell >> which leads you back to walmart? >> walmart was not a -- i like the fact they care about customers, trying to stop inflation in the short term, no. you have to gouge. they seem to have come up with a

model that doesn't -- makes everybody happy. they have a three-ship navy. i think costco knows how to unload a boat better than anybody. >> they the membership fees. >> i'm willing to pay more >> the ev -- now number three among u.s. automakers and last night on "mad money", peeler raulin son called -- >> you cannot go on burning fossum feels the way we're doing

this is a tech race. >> you called it a wondrous technological machine. >> i loved driving it. >> here's the problem. when i look at lucid and look at the rivian valuations, we know it's 1998. andrew said it was 1999, but you know this can't continue >> i love the game but david, i'm conscious of the fact just because there were 17,000 reservations, i have gotten too excited about lucid too excited. >> well, from this video, you do seem to have a future as an uber driver you have that going for you.

>> why not lyft? they're much bigger out here. >> your appointed is a good one. >> i went back and looked at the july projections that they put out the last time we got them. >> i mean, 2.3 billion in negative free cash flow is what they anticipated 27 billion next year 3.2 billion in negative free cash flow. then things start to turn for them only 1.4 or 1.5 in 2024, and then they start to get positive. i assume they're still sticking with this that's what we have to work with here

>> you know, time to raise more capital? why not? you're going to need it at some point. >> he repeatedly said he did not need more capital. what bothers me about this, david, this is what i've been thinking about this is what my daughter hit me with 14,000 reservations in september, and then it went up to 17,000. the reservations are refundable -- this is what i realized i should have been more critical why wasn't it 25 thousand dollars? are we basing this on reservations per share, david? the motor trend car of the year does matter. i talked to two people who said, are you kiting some he you've made too much of lucid. so i think that lucid was up five points at 4:00 a.m., now

it's down. i think it will be a bad day for the stock. >> the value at one point did eclipse gm obviously arrive jan far above the both again, these are elon musk made it clear last week in a tweet, but they're not trading off of fuss cash flow projects. they're just trading off of current reservations. >> and peter is a good salesperson for his product. i don't want to be part of the mob that takes this to be the next tesla, but to not report on it feel negligent. it's one of the toughest reporting jobs i've come up with

in 60 years. i'm just stressed about this >> we're definitely turning a corner here in the auto market it's very hard to read we'll take a look at futures a lot of news on companies like uber, amazon, atvi, some downgrades of paypal and roku. and an up grade of boeing, which we'll get to in a moment

welcome back activision had a tumble yesterday when the "wall street journal" put a story out that the longtime ceo knew about misconduct allegations at the video game giant it's a story we have talked a lot about off air, not to divulge too much, but we have discussed it remember when i shared the california lawsuit back in july, the department of fair employment and housing, some salacious allegations in that lawsuit, but it's come to the forenow. yesterday's story seems to have been important the board of directors rallying almost to his side, criticizing the journal's reporting, saying they're disappointed, it presents a misleading view of our ceo, and instances were

acted upon, but jim, this is not over by a long shot. >> no. >> i have to admit i was somewhat surprised how quickly that board came out there. they knew the story was coming, but to support kotick. >> the essential piece was that he hid it from the board if that's true, show us the minutes. sometimes minutes leave out the more salacious aspects, but we have a cut-and-dried issue the board comes out immediately and endorses him if there was a full vetting and big investigation, i get that, but if the board didn't know, david, who are they to say everything is fine >> that's a good question. again, you know, having seen

many of these in the past, i wonder why they didn't take a breath, but they chose not to. he does have their full support, it seems you wonder, well, could an activist come in and make their bones as an esg play >> it's not clear who replaces him. he built this company certainly development projects, perhaps delayed as a result. then could the get this thing sold which again raises questions, certainly on an antitrust front. >> we know from taketwo, you can

have a great product like grand theft auto, and if it's not ready, there's some people who did not -- are not happy with the design, it gets held up. so when i heard -- i have bobby kotick on -- and i heard there were delays, these are hit-driven companies it did sound like not only is the eye off the ball, but you see these people quitting, they seem to be quitting in droves. if bobby were to come on and say all things are fine, i would feel better here, but right now i question whether the whole company's slate of product is going to have a gigantic hole, and therefore you have to keep selling it. >> and of course there was a walkout yesterday, and they did one in july as well, saying that they believe the ceo should go it's an important story, one we'll continue to following given the "wall street journal's" coverage yesterday.

when we come back, we'll get cramer's "mad dash." taking a look at futures here, as we get more "squawk on the street" after the break. competition beat us again. how? they have a better finance system than we do. i feel like they might have a better finance system than we do. workday. how do they make better decisions faster? workday. it's got to be something workday. i think i got something. work... hey, rob, you're on mute. hello! hey, rob, there he is. workday. the finance, hr and planning system for a changing world. the best things america makes are the things america makes out here. the history she writes in her clear blue skies.

the legends she births on hometown fields. and the future she promises. when we made grand wagoneer, proudly assembled in america, we knew no object would ever rank with the best things in this country. but we believed we could make something worthy of their spirit. [energetic music throughout] but what's strong with me?ake i'm ready for anything. find out what's strong with you with fitbit charge 5 and daily readiness. so, you want evs, you have come to the right place. is that tom brady? yeah. he comes in to recharge, get software updates. you know. let's go!

it's going to be all pretty much centered around the retail complex, as we got the numbers out of lowe's, ross, tjx will lead you on the results this morning. we covered target and walmart is morning opening bell in a few moments. don't go anywhere.

>> announcer: the opening bell is brought to you by -- all right. time to get to a mad dash, as we count you down to the opening bell apple? >> i'm out here, so i think it

makes sense to at least talk about cupertino. david, you know i'm very critical of the research we get about apple ahead of a quarter today is no different. ubs, which of course is the evidence lab, look at what are known as lead times, and makes a decision they're at the high end and frankly they are getting -- wait times are elevated for the iphone, therefore saying that means demand must be great goldman sachs comes out today and says lead times have come down a bit who is right and what he likes is the buyback, but the one thing i don't want to buy apple for is the buyback, so here are three pieces of research i'm putting into the worthless category. you either believe iphone is a better product or you don't.

>> but there's not really a question -- iphones will be in stock, right the good news is it can cost them more, but they did -- though there is some question about vietnam still in covid and concerns about, you know, work slowdowns there as a result. >> but talk about scale. they can pretty much, you know, call their shots, except did you see what qualcomm did yesterday? i have skyworks solutions which plays a -- they don't seem to care, david, what is that all about? >> they're powerful, man i don't know. >> they're powerful? >> yeah. >> griffin should be powerful. we have to find out more, but

remember they could talk about apple. tim cooke doesn't like people talking about doing business with apple that makes it even harder to do the lead time things, talk about horses that are placed d -- hw orders are placed or re-placed you have to talk to vierizon or t-mobile they know the answer the answer is business is unbelievable for them, why they're given away -- the ads are like, hey, we're given away the iphone i want to go to t-mobile -- >> it's misleading no, it doesn't apply to you. >> are you telling me that hans -- >> i'm just saying, you know -- read the fine print. read the fine print.

meanwhile, apple stock is underperforming. >> well, is it one of those -- not everybody can be lucid, david. >> no, that is true. >> thank you thank you for that admission >> you're welcome. let's get the opening bell here at the big board it's gm celebrating the grand opening of the factory zero, the company's all-electric plant in detroit. braze is celebrating their opening. the president will go to the plant later today talking about in the infrastructure big for ev chargen, and it will eventually be the new home of the gmc hummer later this year. >> union versus non-union not talked about machine versus man or woman, not talked about enough.

lucid you go to their factory, you'll see more machines you won't see unions you go to gm, and you're celebrating union workers doing something terrific and wall street is gumming up the works. don't you think ford -- do you think they're going to take it listen to what phil lebeau said. these guys are structurally trying to figure out how do we break out the ev, and the answer is they don't know how, david, they don't notice how. >> by the time they get around to doing it, the fever will have broken >> but the boil will be lanced, right, david >> when we go back to that period we were referencing in terms of something that's at least similar by the time you get around to doing it, things tern, right?

>> is it 96? 97 where are we >> we're 98. so we have two more years. >> yes, we have that kind of time what happens is you -- i want a lucid, no, more importantly i said stock that's what keeps happening. the motor trend car of the year, how much is that worth >> morgan stanley ups their target to 16, but they reiterate the underweight. there's still push and pull. data track said they should spin off their ev operations. it requires the legacy oems to

recapitalize. >> would you want the old ford, the old gm what would you pay for those >> they remind me, david, i'm going to bring up a sore point ibm and kyndryl. that's the internal combustion engine for gm. >> all right i guess -- >> not all right argue with me. argue with me. >> you want me to argue with you about ibm and what was it? >> ibm is to kyndryl as gm is to the old gm -- is that what -- i'm asking for an analogy so people know what the hell we're talking about. >> well, that's asking a lot of our viewers, i think. >> how did asking a lot of us.

no one comes to work out here, do you know that they just go out to dinner they drink during the week what do they care. all they're doing is -- we have to go to work. we can't come in -- >> is it completely empty? >> i'm seeing people pounding, because they wake up and it's like, so they have circles under their eyes, and they've had too much it doesn't matter, carl. if you don't go to work, you can get drunk. >> i do wasn't tags to be to the evs, and their operations to a certain extent there is a different side to this you're going to need to fund losses for a long period of time i don't want to say it's not necessarily something from a valuation perspective.

>> i beg to differ i beg to differ. >> okay. jim farley assures us the ford mustang mach-e is a very profitable business. that's farley. >> okay. off the bat it will support itself >> my wife is in line for the hummer, because it walks like a crab >> the rivian was the best i have ever driven. >> the best -- >> rivian or the lucid which? >> the lucid, david, i saw when i was driving with a lucid. >> so then you followed it and drove a rivian

>> no, i'm sorry >> you're accusing all of us >> let me be clear, i drove a lucid, not a rivian. >> now i can't stop thinking of him as an uber driver. >> will you stop it with this? how about the one where i was in the back why are you showing me like this >> morgan assistantly sticks by its top ev pick. >> i think that's better hi has

a sense of humor, but ferrari is the best car >> he's trying to take amp the risk what happens when the music stops here with the lucid? >> you guys can remember the abuse we all got, and at least questioned the idea that the transaction would occur. over, it did i don't know, jim. they you willy say it's only going higher so, yeah, you can remind them all you want about the potential for fundamental analysis starting to take control, but it hasn't happened. you'll say, hey, you know what this isn't what this is part of.

>> i drove a tesla does that -- i liked bitcoin when people didn't like it am i smart in no, it has not only to do with intelligence >> wonderful name you've got skeptical of is boeing they say easen travel restrictions china max recertification, 787 delivery they say it's a question of when, not if >> it's been when, it's a subject of our debit club talk what do you do when you buy a stock you don't like you're betting the company is going to change.

the 787 was held up, they told me a three-week window, that turned out to be wrong were the talks with xi good? we're presuming they are international travel will be back, because people feel like it's the great whatever, they want to go somewhere, david, i'm going to use it. it's yolo. yolo is why you buy boeing >> okay. >> okay. okay how about i agree or disagree. >> if you tell me it's yolo, i believe it's yolo. >> he's the best colleague i've ever had. >> the best. visa shares are done, and it appears on the news that amazon will stop accepting visa credit cards in the uk? the company is citing the high cost of processing transactions,

visa debit is still accepted, but there is a sense, you know, there's been some pressure on these companies. you've talked a lot, and we'll continue about buy now, pay later. >> look at the paypal downgrade today. >> big downgrade. >> bernstein going to market perform as the disruptor getting disrupted. >> by the affirming of the world. >> there's a question here -- let me just finish when it comes to amazon's decision here, is the u.s. a test case is sort of what you're hearing? are they going to gauge this level in terms of pricing pressure and kind of see what they can do outside the uk

they're gigantic >> not everybody is buy now/pay later. >> it's a great concept, okay? >> and 18% on a credit card is not a great concept, but the vast majority of people they have plastic in their wallet as far as i'm concern, i keep thinking what charlie told me, when it's too hard to get a palacic out of your wallet and give it to someone, that's when it will go away. >> they charge a lot for the opportunity, don't they? >> i like square i think square is doing great. they're worried about all these ip:s, and everybody keeps

talking about klarna, like it's a mysterious beast. >> it does sound nefarious. >> you don't want to catch klarna. >> really quick, wheel we have the time, mover fit cuts roku to sell >> you know what they do -- >> the report says the estimates are too damn high is what he writes >> they call nathanson the ass assassin this was an amazing piece. i read this and said to myself, every time i look at roku, i want to sell it. >> yeah. there's still questions about the aggregators, who is going to succeed, and what that's going to look like obviously roku's platform has

been powerful. they have done a great job in terms of getting paid, but the deceleration that nathanson outlines is pretty severe. >> yeah. yeah by the way, on this topic, going to have a chance tomorrow to speak to john malone, rutledge at charter, tom rutledge, greg mcfay, and also talk to the sirius satellite ceo as well it's liberty investor day, guys, so that will be interesting. star-studded cast of kreismt:s. >> look at that lineup >> we talked about this aier in terms of roku, of all these streaming services, whether you end up in the new bundle >> david, will you please ask him if he thinking at&t is the next growth company? >> okay. i will

>> at&t's shares, call it whatever you said, the stub there, but discovery shares have actually moved up a bit of late. still down not year, but, jim, at&t shares down 14% this year there are still real questions about wireless business, about their overbuilding strategy when it comes to fiber, i guess it's been interesting to watch none of them have done well. they have all had rough years because of the concept they are simply going to be competing not with each other, but with comcast as well. >> netflix, guys, a 700. b of arm, they're going to start publishing more discrete data on viewing in terms of hours. b of a wondering this morning if that's a precursor to the long-awaited ad-supported option, which reed hastings said

he would never do. >> the two classes of stock, there's the classes of stock valued on earnings per share and therefore are pa they haddic, then the ones valued on concepts i feel like when i hear netflix, i think of four, five -- i have a t-shirt that says, 4, 5, 6, thank you to will on the set netflix is just -- people refuse to value wait netflix, carl, by any of the standard traditions we know. by the way, this is different from faang where you could arguely rately that meta is not expensive, and neither is alphabet but lucid is trading on reservations per share, and we have to accept, carl, that -- i think so >> you wrote it carefully.

we say this all the time it's your book >> the three of us could create a stock, get some recent investigations for it. >> reg invesservations it's holding the reservation >> you know what macy's, it's at almost four. >> you can take a reservation. rivian shares are down 9.5%. >> i told you. i told you. first time i've seen it go down >> lucid. >> it's hanging in there. >> a gorgeous sunrise behind jim there. a nice shot. >> let's go to bob. >> it's all about retail they're just on fire a big boost up there from the

earnings today, communications service all right. tech is flattish, banks and energy have been flattish this week and the last week and a half, a bit more energy from them that's what's breaking out we've been talking about retailers, the numbers have been good overall there's issues on gross margins, but here's the key point i want to talk about the buyback -- they've been aggressively redues their buying back stock, and i want to just point this out it's been continues now. since 2011, look at this, dillard's reduced the share count 61%. lowe's 51%, what does it mean? all of the line items being equal, earnings look much better without doing anything you don't have to increase your researches or become more efficient in the income statement. all you have to do is just keep

reducing the share count and the earnings look better, because it's earnings per share. target, ross stores, tjx, walmart. remember something a lot of retailers suspended buybacks in 2020, but they have resumed the buybacks in a very, very big way look at today. target announced they bought back 2.2 billion worth of shares, and lowe's is accelerating the buyback tjx is accelerating their buybacks some people call it financial engineering. others say it's the most efficient way to return capitals the democrats want to tax buy buybacks retail, the trends are pretty darn good. comp store sales have been

great. earnings have been above expectations everybody is focused on gross ma margins. i don't understand that. it's operating margins that matter it includes everything else, like labor and companies are getting more efficient that's the company the big issue is how much longer do they have pricing power can i point out the king of buybacks is apple in terms of the dollar value they have reduced their share count by 37% since 2013. think about that apple's reduced its share count by 37% >> carl, back to you. bob, thanks, as we go to break, a time for the bond report yields down pretty much across the board, macro data is light today, a load of fed-speak

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>> it reminds me so much of the era we keep talking about where everything was named after.com only sock puppet did not have an arena. it's a street. on the dugout, i have the streets named. at the absolute top when the street was at 60 -- if you went to yankee stadium, you saw the street and then you didn't see it >> you had a good show tonight though >> cisco reports tonight and that's a real company. sold at 40 times earnings. and skyworks, which is a big cell phone supplier, but i think it does more than that and okta, the identity company >> jim, your banner week continues. i don't know how you're doing it out there.

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♪ good wednesday morning welcome to another hour of "squawk on the street. markets are definitely taking a breather dow down quick 150, as we keep an eye on some of the rising covid cases in the world >> we're 30 minutes into the trading session. here are some of the big movers we're watching we're going to start with baidu. the it chinese ecommerce company benefitting from stronger sales and shares are down 4% roku down and the firm also cutting its price target from 330 to $220 a share, siteding signs of slowing revenue growth. roku is now down 20 some percent

on the year and we'll end with a mover on the up side same store sales increasing 14% year over year for the retailer, the stock is now up double digits, just over the past month >> meantime, sticking with retail, target shares are sliding despite estimates. with top sales rising more than 12%. >> i think it's a continued momentum we've seen for seven quarters during the pandemic and i think america has come to trust target, the investments we made in safety, the team i think we're being recognized each and every week. we're anticipating a strong holiday season >> and lowe's is on the move as well, beating on the top and bottom line. >> we continue to see is demand continues to stay strong we did a pulse survey of our

professional customer and what they said to us is the back log of projects and their business is as robust as they've seen it in many years and they can see that robust pipeline of projects going all the way through 2022 so, for us, it's really about executing really well. to meet that demand. >> at target, at least, all four of their merchandise categories are up double digits freight, labor, compensation, supply chain and inventory up almost 20. you got inventory's basically at normal levels at the end of q 3. >> it's a sim lrb situation to walmart, which was also under pressure, given the pressure we saw within that company's own margins as well and both are imaginer retailers and walmart,

in particular, have been eating some of the inflationary costs, rather than push it to out prices to consumers. one of those examples, again, during the pandemic, of the big keep getting bigger. because they can navigate all the supply chain bottle necks we're seeing and the inventory numbers speak to that. from a target and walmart standpoint, we're positioned well and they're ready for consumers to come in and do that shopping >> and demand is going to be there. which is a component we should spend time on as well. because, yes, there are supply chain bottle necks and they seem to deal with them effectively. but the demand continues to be very strong. look at tjx, beating estimates

and the best performer up almost 9% >> which speaks to the chopiness of inventory and where it's making its way out there in the marketplace too. because you had product lines that didn't make to shelves on time and for tjx, their store shelves seem packed as well. let's bring in da davidson senior analyst david bake prp let's start with the margins. target yesterday, or walmart yesterday or some of the other names you cover. the fact we're seeing some of the stocks under pressure d spite the fact that there were beats and strong numbers in other areas of the earnings report what does that tell you? >> the markets are cruel companies are giving back to customers in the form of holding prices down or spoending more to make sure the product is in place to drive the top line are getting hit.

we saw that with target today and walmart yesterday. more so than i remember that the market is just focussed on gross marblingen usually the reports are all about sales. as you look ahead to the holidays, this year it's much more focussed on the gross margin because of the supply chain issues >> is this a shifting narrative that's going to stay with us into 2022 where the stocks are concerned or is this a product of supply chain bottle necks >> i think it's more temporary i think at some point, maybe mid2022, the supply chain issues will start to dissipate. i think they're peeking right about now. and we're back to not having to talk about the supply chain pressures constantly then i think it will be the focus on the top line like it usually is i think it's a temporary phenomenon, particularly in front of the holidays.

>> meantime, home depot, trading at all-time highs. it's up higher after a big move. lowe's is trading higher we're seeing a resilience within home improvement is this something that's going to continue to be sustainable. we hear macro trends about housing. the ceos at those companies are highlighting that too. >> they want to help out but this year, they turned negative and consumers are very focussed on your home, a hybrid lifestyle where sometimes you're at home and sometimes in the office. but that's driving continued spending at the home i do think that's a sustainable trend. >> we're keeping one eye on the lockdown restrictions in europe. when you talk about risks, i mean, the possibility that we might see stricter lockdowns could clamp down on consumer

sentiment and hence their ability to buy at retail how would you characterize that risk >> to me omni channel has proven itself to be the right model you think back to early in the pandemic and throughout 2021, retailers with strong omni channel offerings, the stocks and companies are good as we get more lockdowns, i think they'll revert back to that play book, which worked so well during the pandemic these big box retailers, i think, will do well in the environment. >> quickly, michael. buy on the dip for target and walmart. and what do you think of the home improvement names >> i think they're doing the right things to give back a little bit to their customers in terms of pricing it hurts in the near term but will pay off in longer term

market share gains and bringing in new customers we also like more lowe's than home depot that's more of a valuation call on home depot. but we like lowe's they still have the self improvement story behind them. when he started the operating margins with 600 basis points, now it's closer to 280 so, they made progress but there's room to grow >> thanks for joining us >> thank you >> meantime, as you can see, dow's down 117 today and dow's close to a record high with thoughts on the market and you might put your money, tony, welcome back always good to have you. >> thanks for having me. >> i wonder, before we get to some of the names you're watching, whether this environment we've been in for about a month, where people are talking about a year-end melt up

is making your stock selection more challenge sng. >> we've been seeing the continuation of a trend for several years, a market of haves and have nots. if you're not a unicorn, you're a dinosaur and therefore uninvestable and we're seeing that in the payment space, in autos. and at oak mark, where we're focussed on intrinsic values, we take advantage of that >> i think one of the terms we used was dino tech, opposed to unicorn. pfizer has your interest >> it does about 40% is in the payments area there's lots of new intrnts. there's $102 stock going to make roughly 650 in earnings next year that's a 30% discount and

growing with much high return profile. you look at the payments business and there's unicorns in the dinosaur they have a business called cloever. clover is a small business merchant acquiring technology and 200 billion running through the net drz work it's growing in a 35/40% range and has a lot of value that will insure their relevance going forward. >> phoney, sorry i'm curious because i assume you hold it in the last earnings print where it got beat up there's a sense that things are slowing or that new competition is coming in some way to crimp their ability to grow. i didn't mean to cut you off there. but i did want to follow up and ask why did you believe that >> no problem. and that's why i focussed on

carat and clover because these are the types of investments you want your management team to make we look at good management teams thinking about the future and they've been thinking about the future and made investments to stay relevant as things shift, like in small merchant acquiring. and they've made that transition with clover. and you look at something like carat, which is where e commerce, there's a lot of new commerce there oddian is a market cap $80 billion. audion trades at 89 revenues and at they have 10 plus pillian elsewhere. they're unicorns trapped in a dinosaur and the market isn't giving full credit >> when we talk about intrinsic value. you talked about the unicorns

trapped in the dinosaur at pfizer where ilsz else do you see those other examples at a time when other kucompanie with unicorns trapped in dinosaur, are starting to spin out. is that a good time to realize revenue in your investments? >> i don't know. and another company like this would be general motors. they have this cruise business, which has been verified. and it's trading at a multiple you look at the market value of the old big three in detroit, v verses the big three evs they're 1.3 trillion in market cap together and the big three u.s. normally u.s., auto makers

are something in the 200 and change range, all in together. one could be cheap, one could be expensive but a lot has to go right for the 1.3 trillion to be right. >> you're more of a value guy but this may be 1998 could be two more years of watching this, of head scratching multiples to revenues that are many years out. i assume you stick with it because this is what's worked for you in the past? >> absolutely right. and worrying about when it's going to start working is unproductival. at oakmark, we're more focussed on the businesses and the management behind them >> i hate to beat the payment space to death, but visa waus taken about 100 points off the dow. are you making a directional call about legacy credit cards

in some cases what we thought were the disrupters are getting disrupted, apparently. >> that's always the risk in any technology business. if you look at something like visa there's been a lot of change and form factor for how we pay for things, whether a card a phone and there's been several thirn thintech in the payment space and they tried to go around an open network like visa and to date isn't working to me, it looks like gamesmanship over pricing and we weal rrb see what happens. >> that's a high stakes battle in the early stages of developing always good to get your take appreciate it. >> thank you all >> as we go to break, take a lookt the road map for the rest of the hour. including bitcoin, trying to come back.

and ev companies still on the move lucid up, rivian down sharply. and bezos burned senator sanders, that is, taking a swipe at the amazon founder in a tweet last night we're going to discuss a lot more "squawk on the street" so don't go anywhere dripping from the ceiling. you never know when something like this will happen. so let the geico insurance agency help you with homeowners insurance and protect yourself from things like fire, theft, or in this case, water damage. now if i had to guess i'd say somewhere upstairs there's a broken pipe. geico. save even more when you bundle home and car insurance at geico.com. what's strong with me? what's strong with me? what's strong with me?

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getsing breaking news from the white house on the energy complex.

hey. >> reporter: at this hour, the president asking the them to investigate mounting evidence of mounting consume r behavior by gas and oil companies. specifically talking about the pred between unfinished gasolines, which is the main inputs between gas sold at the pump and gasoline down morn on the 5% but gas prices are up 3% in that period he calls it an unexplain sed gap when they're doubling net income from 2019 and returning more capitol to shareholders. pn president biden has already called on the ftc to investigate price gouging. and this letter does not replace potential future action, like tapping the strategic petroleum reserve. we're still waiting to see

whether the administration broadly chooses to pursue any of those actions. the president is trying to call attention to these issues ahead of the travel-heavy thanksgiving holiday. >> it's pretty incredible. in my town, the top tier gasoline is over five bucks a gallon out of curiosity, crude is under pressure on speculation we could see release from the strategic petroleum reserve. anymore guidance on whether or when that could happen >> certainly, morgan, last week the energy secretary said it could happen and it could happen soon i also talked to a senior administration official who walked through scenarios about exactly how this could potentially be done using sales that have already been authorized by congress so far, we haven't seen the administration formally announce anything to that end the website says it takes 14 days from presidential order to see the oil hit the market

and i know the white house is acutely concerned about prices before the pump as they hit thanksgiving it wouldn't hit consumer pocket books before the holiday >> thank you it's been a wild week for evs rrb and phil lebeau is tracking the latest moves in the space. hi, phil >> check out the market caps of basically two ev stocks that have just exploded in the last week lucid and rivian and compare those with the market caps for general motors and ford for a very brief moment yesterday, lucid surpassed general motors today, gms market cap is greater again than lucid up 25% in just the last week and really the explosion happened in the last couple of days. reporting their results for the

third quarter a loss of $1.5 billion that did not stop enthusiasm for the stock because the company has more reservations for the lucid air. but this has gotten the attention of analysts on wall street and widely believed by many to be the most influential, when it comes to valuing stocks. he says this about lucid's val yaugds the current share price values the company just shy of $100 billion, approximately $200 billion per unit delivered so far, while the total addressable market is vast, we believe the market is pricing in extraordinarily high profitabilities of success or very low levels of risk. all of this on a day when general motors is opening its first dedicated, all ev plant. factory zero, the old plant just outside of detroit

they're opening it the first hummers will be delivered by the end of this year and we did talk at the president of gm on "squawk box." and he was emphatic when people said he should spin off the operations there's such integration between the work they've done with the battery operations and other aspects of the ev portfolio, that it's not as simple as saying we're going to spin it off. they're surely going to be continued talk about that, david. >> it is interesting, phil, of course, when you go back the late 90s and i can remember companies that had digital units that could have been valued on the basis of purely digital companies trading at incredible multiples. but these thing can change when it comes to valuations

it's really a revenue number you're basing a huge multiple on >> exactly and the one area where i think g general motors would entertain the possibility of spinning off a particular unit is the cruz division, the electric autonomous ride share operation that has been developing its business in the san francisco area very close to offering commercial rides to you and i, anybody on the road. they only need one more regulator to approve it. so far, gm says we're not switching off cruise so people say get the value out of all the money you invested into the ev operations sglirlts a crowded field, phil and it's fascinating to see how all of this is evavling right now. i think of your interview with the porsche ceo yesterday on "closing bell" and the conversation there and the fact the sales there have been brisk as well.

there's emerging growing market, not just in the u.s. but globally is to rrb soon to say, at least in the luxury market, the winners and losers yet sglits >> it's too soon you can look at the tesla luxury x, it has been wildly successful and a yeah, that could be considered potentially a winner, though very, very early in terms of their deliveries and you have other established luxury names like mercedes benz they've already begun deliveries of those let's see what happens with the eqs, let's say, over the next six months it could be people say they want that instead of the lucid air. we'll find out in the next couple of years.

>> phil, thank you such an interesting topic. we talk about it every day, as we should. we want to get more on lucid specifically and we can talk the ev market. we're going to bring in the research analyst, garret nelson. garret, you have a buy on a lucid. been a good call $65 is your price targeted but when it comes to fundamentals, what are you looking at when it comes to a market value of roughly -- >> we think lugscid checks all e boxes when it comes to staying power. we like that they're targeting the luxury market. so, they don't have to sell a lot of cars in terms of volume for the business plan to work. they're targeting sales of 20,000 vehicles next year. they're almost there in terms of

the reservation count and they want to grow to 135,000 in 2025. so, we think that's very achievable, especially considering the quality of the product and the speck. just named motor trend car of the year for 2022. and the company made history, in terms of being the first auto maker whose initial model received that prestigious award. you look at the specks of the vehicle and it's the first electric vehicle we've seen where the specks are really on par or superior to a tesla product, in terms of single charge charge range, 1100 miles and over 1100 horse power. >> we were just talking to phil lebeau so many auto makers to represent competition for lucid in the future

what dpivs you the confidence they can takes a pluch of share -- again, you're saying u unit numbers are not that large. the overall market of $100,000 auto mobile may not be large when you have porsche, bmw, audi all coming after you >> sure. we see the u.s. electric vehicle market growing just under 300 thoin,000 units sold last year, which was just over 2% of all new vehicle sales. we see that 2% growing to 30% in the year 2030. so, there will be plenty of room for lucid and others in the market, especially the auto makers producing high-quality pro product that is similar to a tesla vehicle. there's a reason tesla has become the dominant player in the ev market. because their vehicles are so

much better than anything out there and that's allowed them to grow their market share to nearly 80% of the u.s. ev market we think tesla's market share is about peeked and you're going to see a lot more competition from lucid, risk and others, what you're seeing right now. >> garret, at a time when we're so focussed on supply chain, this massive global shift to evs is going to mean more copper, more lithium, more rare earth materials. all commodities that tend to be harder to mine, in shorter supply, as we see scale begin to ramp, and production begin to ramp for all the auto makers how real is the risk >> it's significant. and if you listen to elon musk and other executives in the industry, they're very concerned about that but what we're seeing is a lot of metals and mining companies

making the investment now in terms of lithium, copper, cobalt, and all those other metals and elements needed to really meet the future battery demand so, we think that supply response is coming >> garret, thank you for your time >> thank you still to come. we'll check win art cashin and we'll get the latest reducing our carbon emissions to net zero may be our biggest challenge yet. there's no single action that will lead us to carbon neutrality. but there is a single source of essential sustainability intelligence. s&p global sustainable1.

uncover risk scenarios, reveal transition pathways, and optimize your net zero opportunities with our unparalleled data and insight. accelerate to zero with us. so, you want evs, you have come to the right place. is that tom brady? yeah. he comes in to recharge, get software updates. you know. let's go!

welcome back i'm rahel solomon and here's your cnbc update at this hour. for the first time ever more than 100,000 americans died in a drug over dose the cdc says the pandemic and the growing presence of fentanyl are contributing to the ongoing increase in over dose deaths the staple center arena, los angeles, will become the crypto.com arena, after the crypto currency exchange,

reportedly agreed to pay for the naming rights. the ceo will appear on tech check about an hour from now queen elizabeth making a public appearance on video for the first time since missing a engagement last month. they released video of the 95-year-old monarch greeting the top military official in windsor castle, apparently to ease fears about her health and a joyful reunion after spending a month in a public library, charley the teddy bear was returned to his family an employee found the 40-year-old bear and went online to find its owner whose have loved it for three generations got to love a happy ending back to you. >> oh, thank you let's head to our etf spotlight. ticker xly jumping more than

16%, boosted by top holdings like amazon and tesla. also in the group, cruise lines, which have been sinking. our eighth straight negative session in a row we'll be right back. ayitusst wh

so, you want evs, you have come to the right place. is that tom brady? yeah. he comes in to recharge, get software updates. you know. let's go! (soft music) hey dad, i'm about to leave. don't forget your hat . good morning. how can i help? i need help connecting with my students. behind every last minute save, ok, that works. and holiday surprise, thank you! a customer service rep is working unseen, making it happen. and at genesys, we're proud to help them help you everyday.

you see the dow down about 140 or so. visa's taken off about half of that today and let's bring in art cashin. good morning, art, good to see you again. >> good morning. good to be here. >> we had you on a few weeks ago. and at the time we were talk about at what level the 10-year yield would be a rail in your words. you're still watching it but i think you're more interest s

saided in the 165 level now. >> i think we're getting a little bit close here. there's a feeling on the charge that you might make a quick move towards that 170 so, it's been interesting to watch in the last few days we move up to 163/164. they walk away, the market starts to commend, they tick down a couple of basis points and come back. as silly as it seems, the market is looking at it, not so much that one basis point will make that much of a difference in the economy but it will make that much of a difference, technically, in a chart breakout we're going to get out the microscope and take a careful look at where it's going here. 165 is a place i'm going to watch very closely >> meantime, retail is the other big story. both yesterday and today as we look at some of the mega

retailers, in your words, trying to eat up some of the inflationary pain, even though that might take a hit to margins. i wonder what your thought is on what that's doing for inflation and the consumer >> so far it's keeping inflation from becoming too really aggressive we're going now into this amazing seize on of the holiday, black friday and 70% of our economy in a nonpandemic time, relates to the consumer and so, that's going to be critically important if, as we've seen with the places like walmart, some of these guys try to eat up some of that extra pop, that will be good for retail sales and the consumer but it will eat into the margins. so, that's why you saw the

different performance between home depot yesterday and the reaction to walmart. i think what's also critical is within a matter of days, we're going to hear from the president about a fed chair and one thing hath hasn't been spoken about is they better start counting noses on capitol hill. powell is very important and popular on capitol hill and i don't know that they dislike brainer, but there may be back lash that would make it difficult to confirm anyone but powell certainly all of us traders will be watching. >> that's exactly where i was going to go with you was the fact we're going to get this announcement by the end of the week, either powell or brainered. a lot of reporting about what

fed fallacy under braynard would be like. probably steady as she goes, same as powell, but maybe -- how do you think the market would react if it was braynard and that did make its way through the senate >> i think it's going to be difficult to speculate on exactly where it is. we're starting to see hear some of the other fed governors get more aggressive. we're hearing maybe they have to move up more aggressively. they know virtually nothing will happen until after the announcement and possibly the conformation occurs. you know, i think powell is ready to begin to move a touch more aggressively. but nobody wants to do anything until the president makes hiss nomination so, even if powell is

renominated and looks for an easy conformation, you still may see the fed begin to move. this is go took be a time to be very agile on your feet. i don't think the course is particularly clear yes, braynard has a variety of other interests. in the short run, the concern is not whether we get environmental or whatever. in the short run, it's going to be will we start to get more aggressive in tapering will we in fact begin to raise rates more quickly some people talking about a quarter point move to begin with those will move the market and maybe shockingly in the short run. >> we got plenty of fed speak to chew on until we get that decision from the white house. talk to you soon >> my pleasure thank you. >> well, you're not going to

want to miss a big show tomorrow on "squawk on the street." i'll be live from investor day and we'll speak with the ceos of charter, and don't want to miss it stay with us leaving you lost. you need to hire. i need indeed. indeed you do. indeed instant match instantly delivers quality candidates matching your job description. visit indeed.com/hire

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wealth management. (rhythmic electro rock music) (crowd cheering) - bito, bito, bito, bito! - [announcer] bito, the first u.s. bitcoin-linked etf. welcome back to squawk on the street we're taking a look at crypto-related stocks, following the asset class's sell off as of late double digits down and coin base shares are still in the green over that time. up about 3.5% over the past week

we're joined by crypto exchange, voyage digitals, coming off earnings and a mastercard announcement and that's another publicly traded name that has moved somewhat in sink with crypto and i think that's where we're going to start i want to get into earnings and the card the moves we have seen in recent days what do you make of those and what does it mean for activity on your platform >> thanks for having me. but the activity we've seen on the platform has been tremendous especially over the last few days as there's been a dip in prices. and they're coming in on the number of products on the platform you're seeing opportunities to buy coins like avalanche, which has moved up quite a bit next year and we're seeing tremendous

activity from coins, as well as opportunity to buy bitcoin and etherium as they're in a dip >> it's interesting to hear you say that i'm looking at your earnings as well you mentioned the september quarter was just a speed bump for the industry and experienced by other platforms as well and voyager has faired better on a comparative basis. this idea it was a sfeed bump, sounds like it's come roaring back how do you sustain that, given the fact we see volatility in crypto kurngsys more broadly >> we're seeing a tremendous quarter. we're on pace for a record quarter to exceed our june quart rb we will achieve that this quarter. we're seeing the activity and investments we made over the summer in customer acquisition are really paying off as we're seeing constant account growth on the platform. rrls we're one of the top 20 apps and it's a matter of more

and more adoption and we're seeing the adoption because of the various coins we have on the platform and opportunities people can earn rewards with are deep liquidity and loyalty reward program that we give to customers that's helping the adoption and growing our business and even volatility. people are bringing more money on to the platform as they see an opportunity to buy bitcoin, less than 60,000 when i'm very bullish on it, and yv rrb said it before and still believe bitcoin will be 100,000 by year end. there's an opportunity for investors to buy cryptocurrency add a fair price >> it is a competitive landscape. how much are you spending on customer acquisition >> we have a very good model we're using and we know it's a competitive landscape but the way we have done it, we have experience from this

we have a team from e trade that we put together and we helped build it back 20 years ago we've seen the competitive lands scape and we're using it to our advantage as we keep acquiring customers. quite a bit every day now. >> unfortunately, i think we have to wrap the conversation. about this debit card. i really want to hear more about that and the partnership with mastercard stephen, thank you for joining us today >> thanks for having me. meantime, inflation obviously front and center this earning season for restaurants, which are already facing ongoing labor shortages and supply chain challenges kate rogers looking at some of that today hi, kate >> hey, carl, good morning the national restaurant association has said now last month overall menu prices are up 5% in the last year as restaurant commodity prices soar fats and oils up 50% but chipotle says it's well positioned and it's flexing pricing power as they protect their margins moving ahead

>> we believe we still have plenty of pricing power to use at our discretion. and, you know, we'll use it when we need to but, obviously, we prefer to really keep our value proposition as strong as possible >> now, mcdonald's said it increased prices around 6% no consumer pull back and shake shack said commodity prices and labor are pressuring the company's margins, but executives think they have additional room to run this sentiment was echoed by yum brands as well this quarter. brinker saw labor and commodity costs as did denny's whose exec said its margins were volatile and several quarters before staffing challenges were eased if you look at stock performance, those with pricing power also happen to be performing well for the year all up double digits now brinker is the biggest lagger and denny's up just fractionally for the year. carl, back over to you. >> kate, have to keep our eye on

food inflation for sure. that's our kate show big show coming up on "techcheck" with cramer coming and l.a. staples center getting a rebrand ready to become the crypto.com arena starting christmas day. we'll talk on their new 20-year naming rights deal when "techcheck" begins 'rba itwmites. so, you want evs, you have come to the right place.

is that tom brady? yeah. he comes in to recharge, get software updates. you know. let's go!

welcome back as we head to a quick break. shares of cassava siciences getting hammered today as they face sec probe this is according to dow jones we reached out to cassava and we'll let you know when we hear more shares are down 25% right now. stay with us and t-mobile will pay for it! upgrade to the iphone 13 pro... on us. what if you could have the perspective to see more? at morgan stanley, a global collective of thought leaders

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yeah. he comes in to recharge, get software updates. you know. let's go! (rhythmic electro rock music) (crowd cheering) - bito, bito, bito, bito! - [announcer] bito, the first u.s. bitcoin-linked etf. firefighter maggie gronewald knows how to handle dry weather...

...and dry, cracked skin. new gold bond advanced healing ointment. restore healthy skin, with no sticky feeling. gold bond. champion your skin. welcome back jeff bezos feeling the burn from senator sanders with the senator tweeting last night, no, congress should not provide a $10 billion handout for space exploration as part of the defense spending bill. unbelievable this is, i would say, a rather simplified tweet on a rather complicated legislating topic, david. this has to do with the fact that senator majority leader chuck schumer basically said

that they're going to merge that big $250 billion u.s. innovation and competition act, remember that anti-or that china competition bill that made its way through the senate earlier this year and stalled in the house that involved all the semi conductor investment and new tech investment. that is going to be merged with the national defense authorization act. basically the defense bill that is being introduced in the senate today there was an amendment in that china bill that would allocate up to $10 billion for the project which is part of the program for nasa to return astronauts, u.s. astronauts to the moon spacex awarded a contract by nasa and blue origin has fought and fought and unsuccessfully to also be awarded a contract and this amendment would basically carve out money over the next couple years to potentially have more companies go for lunar landing contract, including possibly

blue origin. >> got it. that helps that helps it is more complicated than it appears certainly from that tweet. >> lobbying efforts by blue origin so that is where that tweet comes from and not a direct payout for jeff bezos and blue origin. >> all right bezos is doing well. we're not too worried about him. >> that will do it for us right here on "squawk on the street. "techcheck" starts now. good wednesday morning welcome to "techcheck. i'm carl quintanilla with john fortt. what is the playbook now a downgrade for paypal and roku while amazon and peloton ned