tv Closing Bell CNBC April 27, 2022 3:00pm-4:00pm EDT
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division his two stocks outran the others. >> on the program he said fordham amc would be his pick. jim will be with us, melissa lee to talk through the picks and, you know, give us some stocks. >> the stock draft is tomorrow to get you ready for the nfl draft later that night. >> closing bell starts right now. ♪ looking forward to it, guys. stocks trading in a wide range today. off the highs but holding on to the gains. most important hour of trading starts now welcome to "closing bell." right now, dow's up 200 points we got as high as 457 but did negative at one point in the session. it's been all over the place looks like the gains are holding here the s&p 500 up half a percent. we are down about 2% for the week at least on the nasdaq which has been really the eye of the storm lately on earnings and selling. it's up today, a third of 1%
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weakness a alphabet and meta chart of the day to boeing falling hard after posting a wider than expected quarterly loss the worst performer in the dow, down 9%. coming up, the latest read on the travel industry. hawaiian airline's stock tanking today on the back of earnings. we will talk to the ceo. also, check out shares of spotify. they are sinking as well following results before the bell down 12%. the cfo joins us with the latest read on subscribers, advertising demand and more. that guidance disappointing the street are straight to the market in action in technology alphabet after netflix shut a third of the value on the back of the shocking subscriber numbers. it's down 4% today so what is the read through for the rest of tech, including meta after the bell, amazon and apple tomorrow joining us is victor jones from tasty trade and megan from verdon's capital advisors.
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victor, meta not taking it well. down another 4%. now down almost 50% for the year how do you trade that setup out of earnings today? >> well, the market it still implying a rather big expected move here at something like 13%, paypal another one, 10% implied move we are having conversations with our customers on a day-to-day basis. one of the things that shocked me the most is how often series i bonds are coming up. buying the dip in long duration securities to capital preservation, protecting your capital against inflation or protecting your capital against capital depreciation there has been a lot of talk about what's priced into this market and what is not priced into this market and i think a week ago that was sort of a hard pill to swallow, that the market had priced in all bad news you look at the faangs stocks at or near all-time highs in the last five days alone, facebook, amazon, netflix,
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google, nvidia, down more than double digits in the last five days i think the good news is the biggest risk for that market was concentration risk this week into next week, the idea that people are starting to swallow the lower demand pill, realizing that even if you pay a premium for more predictable cash flows in gigantic stock buybacks, these stocks with their monopolies or i should say their moats are not impervious to a break down for the individual consumer. this is a positive thing the bond market has effectively digested what the fed has been telling them and if you listen to bill dudley he said, look, if the stocks - >> pressure on stocks. >> yeah, if stocks don't move lower, we will have to help them the idea that we are getting a repricing is good. obviously, it's painful to go through as an individual investor. >> megan, can you make a case at this point to buy tech, especially the mega caps
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alphabet earnings, i know you can't talk specific stocks, for flavor, disappointing on sales they are exposed to europe it was a youtube issue still growing double digits. fx is a problem with the dollar strengthening. the nasdaq is down 20% this year so would you buy it? >> not yet i still think there is quite a bit of volatility we will see throughout this year as we navigate through the fed removing that ultra accommodative monetary policy. this is a decades old theme that supported these stocks it supported heightened valuations and supported speculation. i think those days of over i think there is room for these stocks to reprice that valuation. i would be cautious right now. from a seasonality perspective remember the s&p 500 as a whole in may and june can be volatility months. there is other areas of the market that i think are overpricing the pessimism on economic growth we would focus
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on. >> like what >> the shawl and mid cap area of thing market if you look at those valuations, if you look at how much they have declined, small cap growth down almost 30% from its high. small cap value. these areas. market have priced in i think a lot of this negative news and if you can withstand the volatility as we kind of figure out where we stand from economic growth standpoint, these can look good from a long-term perspective. >> small cams are underperforming again today. victor, what do you think? down 23% from the high on small caps, worse than the nasdaq, and that is with a domestic economy that is faring better than the rest world and also where stocks are ultimately doing better than even bonds. >> yeah. it's true. i think that tina argument becomes more difficult to hold on to, especially in the face of repricing faangs stocks. i think small caps are probably a tale of two stories. you have in many cases in small caps and russell two 2000 cases
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of ridiculous or i should say higher valuations that historical measures and in some cases i agree with your guest that you have attractive valuations i think the problem here in my personal opinion is as you look out with what the bond market is pricing, they are pricing five-year, five-year inflation expectations at 2.4%, which is down from 2.65%, somewhere we were just a couple of weeks ago. the risk at we are at peak inflation. the risk here on out is what is sticky and what is durable and i think as we get closer to the end of the year the fed said the long run expectations of fed fund rates around 2.4% and the risk here is that the durable part of inflation, we are not going to get down to their, you know, to their levels of, i think it was something like, you know, 2.6 or 3% by the end of the year that becomes a lower probability the dhoeser removed to the end of the year and the market continues to have to reprice
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and i think regardless if you find value here, my point to the individual retail investor you can use volatility as an asset class. professional money managers, they have to be fully invested they look at utilities and staples and energy, but individual retail investors don't have to take unlimited downside risk. you can use elevated volatility for your advantage and, you know, as volatility cools down here, which inevitably we will, moving forward with buying some put protection, selling upside calls, reducing your basis are strategic ways to navigate a marketplace that is completely uncertain. the vix is telling you there is two times more uncertain as an individual investor you don't have to take unlimited town side risk you can utilize option for risk management which is the opposite of how people have been talking about retail investors using options for upside speculation we are seeing that
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encouragingly. >> victor, megan, thank you for joining us with some advice there. the s&p 500 up about 0.5%. communications services, utilities and real estate. coming up, travel stocks largely rebounding today but hawaiian airlines falling sharply on engs we will talk to the ceo that deal with elon musk's deal with spacex for internet. you're a one-man stitchwork master. but your staffing plan needs to go up a size. 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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we are watching shares of carvana trading lower after being halted twice in the last hour touchdowns reporting $1.6 billion of bonds being sold by carvana that's roughly half of what the company put up for sale to fund its purchase of another used car auction network. shares down around 70% this year this was an industry on fire out of the pandemic, used cars, prices rose and that's basically hit a growth wall and the stock plummeted and this shows you with an interest rate of to 10.25% it is tough sledding for names like carvana take a look of hairs at hawaiian airlines falling hard after first quarter earnings despite beating revenue estimates the company, and here is what hits investors, suspending guidance for the full year citing ongoing travel restrictions and international markets like japan here now for a first on cnbc interview is hawaiian holding
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ceo peter ingram wall street doesn't like that, taking away the outlook for the year what made you go there why is it so uncertain >> hi, sara. great to be with you we have had guidance for the full year for capacity and for cost for asm, which is, obviously, capacity is the big determinant of that because it's the denominator of the calculation. because of the uncertainty of the timing of when we can resume a fuller schedule to japan, we made a decision to suspend that guidance, but we've got guidance out there for the second quarter. we've got revenue guidance and there is a lot to be encouraged about in our story now as we're seeing really strong demand in the markets that are fully open. >> what do we know about japan, which is, obviously, so critical to your business when those restrictions might ease and what demand might look like now that their currency has
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fallen to a 20-year low. >> well, we have seen, you know, gradual relaxing of some of the restrictions in japan. an increase in the caps, the limitations that are place in the number of arrivals per day it's not nearly enough to satisfy the underlying demand right now, and so we're going to have to wait on the timing of that we think it is probably going to be at least another month or two before we see meaningful change in that. but of course, it's up to the government of japan to make those changes. but we do feel that there is going to be a really strong resurgence you can see it in the zaire for japanese to travel domestically. you can esee it internationally in terms of demand from higay
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highway from laplace us like australia and south korea. japan has a tremendous historical affinity for travel to hawaii. really sustained a lot of ups and downs over decades, and i have every confidence that it is going to come back very strong when people are free to travel a little more openly. >> so talk a little bit about this deal that you made with spacex it's interesting because it's the first-of-its-kind. so you are using his satellites for free internet on the planes? how does that work and do you expect your competitors to follow through with this sort of deal as well >> this is something we're really excited about we waited for a long time to put connectivity ln our airplanes because the current generation and prior generations of satellite connectivity for aircraft haven't really worked very well over the pacific and the lower earth orbit
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satellites that starlink uses, that spacex is putting up by the thousands, are really a game changer in terms of the technology, in terms of being able to support streaming on the aircraft from everyone on the aircraft using the device. we know our guests are going to be delight and we can't to get to doing these installations over the next year or so we expect to start installing the satellite antennas on our airplanes starting in 2023, and it's going to be a great partnership. >> i think the free wifi is going to make people happy it's always annoying to have those charges. but, peter, you know, speaking of the competition, there has been a lot of excitement in the industry with the return of travel and consolidation as well spirit and frontier trying to merge and trying to acquire spirit what does that leave you are you going to need a bigger partner to compete right now >> we've come speeded for 92
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years very successfully serving the people traveling to, fromnd and within hawaii. we are seeing strong demand come back as markets have opened over the past year. we are outperforming our competitors on revenue generation throughout our network. so i think we're very well positioned to continue to be successful for many decades to come as we have been in the past. >> peter ingram, thank you for joining us appreciate the interview on a day like today where the stock is lower on that suspension of guidance. the dow is up about 146 points we lost a little steam the final hour of trade. the s&p 500 gains of a third of 1% the nasdaq is slipping a little bit. it's a tale of two techs microsoft soaring. a lot of the chinese internet stocks doing well, pinduoduo higher salesforce is rebounding but meta, alphabet, netflix
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those names continue to get hit hard small caps down a third of 1%. still ahead, the cfo of another big earnings mover, spotify. what he makes of the street's negative reaction to that print. and after the break, mike santelli looking at the strength of the u.s. dollar into today's dashboard as the dollar induction jumps to multiyear highs. some of the top search tick ergs on cnbc.com. actually, we started out with yields a little bit lower on the session. we turned higher now prices there selling off microsoft a big earnings winner up 5.4%. boeing a loser, down 9.4%. tesla a 12% sell-off yesterday alphabet down had 4% on earnings we'll be right back.
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an absolute tear lately. the index at the highest level since march 2020 that was peak pandemic fear. mike santoli taking a closer look at the dollar for the dashboard today. >> sara, a dramatic look at a ten-year basis you mentioned the highs here just under 103 that's where we were march 2020. also here back around 2017 after the 2016 election there was this idea of fed tightening you had differentials in growth. of course you know what happened in 2014. negative yields in europe. the euro cracked at that point obviously, the yen is weak now chinese currency not reflected in here. everything going on amounts to, of course, in part a tightening of financial conditions. that is one of the things that a rising dollar means and it shows you along with higher treasury yields and collapsing mortgage applicationsth the fed' policy of heightening is taking hold. look at the financial conditions
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and how they tight end if you exclude what's gone on with the stock market goldman sachs is still easy if it's town on the chart coming into the week you see here you really hadn't gotten back to the low end of the long-term range. if you take stocks out, you are almost there in the neutral area that means stock valuations are the one thing that maybe have to compress more to get the fed where it wants to be if in fact it needs the whole thing to get as tight as this chart would imply. >> we are seeing the real lifetime pact of that stronger dollar 17 cent hit to earnings because of the strong dollar. >> even alphabet down with revisions to coming quarters because of currency. >> shows our imports on fire, 11.5% last month. spotify shares falling sharply after reporting weaker than supported add revenue
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highs of the sessions. kate, what is going on here? getting mixed messages. >> shares of yaem halted twice after that headline implying that the mcplant would be a permanent menu item at mcdonald's beyond meat's ceo and mcdonald's cmo were in conversation about the mcplant at a fast company summit but mcdonald's saying that headline was misconstrued there are no menu updates in the u.s. there was confidence in the partnership and future which clearly excited investors would seized on that headline. beyond shares taken a beating, down 60% what's interesting is analysts at bti g were not positive on the mcplant even this spring saying it was underperforming franchisee expectations and salesforce performance underwhelming. making a permanent membernu itea a surprise confident about the future of the two brands. >> gains of 12%.
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good take for yaem thank you. another big mover is spotify. shares sinking more than 12% even though they beat earnings estimates it was q2 guidance that fell short of analysts expectations the cfo paul vogel welcome. nice to see you. >> thanks for seeing me. >> the forecast $209.6 million operating loss is one of the biggest losses that you have seen, right, in your history as a public company market is not in the mood for those kinds of losses. >> first of all, thanks for having me. congratulations on the new show. first of all, if you take a look at the quarter, it was really strong so i think when we look at backing out russia and we exited russia when you look at user growth, above expectations, subscriber growth, above expectations the main metrics are strong in the quarter. we look at guidance our guidance on user metrics strong
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strong subscriber growth, 6 million net additionsing and adjusting for russia we are expecting 14 million net user additions in q2 of this year that's better than the 9 million last year and if you go back to 2020 who everyone was talking about the covid benefit and streaming, we were expecting to do more user growth in q2 of this year than two years ago at the beginning. pandemic when -- >> that's not a user growth problem. it's a profitability problem. >> let's kind of unpack that first let's get the gross margins. when we look at the gold medals of our business we know investors say when are we going to see gross margin expansion in the business and we look at it differently than that. what we have seen on the core business, the business that we were a part of in 2018, we did our -- it is that's the core music business and marketplace business it's expanded nicely that's hidden bus. investments we are making in original content, podcasting and all those things that's translating into some of
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the losses you yhave seen. in q2 currency we are -- we have more operating expenses in u.s. dollars and as a result 50 million of the loss is a currency translation. so the -- >> but you multiple flied revenues the last few years. the losses have only grown so is there a period where you have to shift strategy if the market loses patience on this investigating -- >> yeah, so we're well aware the market is not in the mood for -- business -- but that being said, we are looking at our business over the long term, one, three, five, ten years and we put a plan in place to invest aggressively six, nine months ago. you are seeing that now. where is that investment going continuing in original content, podcasting business and in improvements to the product. that's number one. number two is we've hired a lot of engineers, data scientists over 50% you have our head count growth is in r&d, building these tools and services also in business with
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3.5 billion on the balance sheet. we generate positive free cash flow every year. so we feel like this is a perfect time to invest when we see the benefits of our investment, you know, bearing fruit. >> i know you hate the netflix comparison, but you are getting it it was the first question on the earnings call today. you had to spell out why you are in the netflix explain to the audience why, because you do rely on a subscriber growth model, you are pouring tons of money into original content as they are, and there is increasing competition and shifting habits and also, by the way, inflation, which is crimping consumers. >> first of all, i don't want to talk about someone else's business we are a actual revenue stream business we have premium business butwe are up to 50% of the revenue from advertising and we expect that 20 to 30% of the business going forward. we have a business model different from that. if you go back, again in our direct listing, higher percentage of the business from a pure subscription business
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we evolved beyond that we are building a platform becoming a platform company that's available to all different types of creators and a tremendous amount of content on the platform. so unlike some of these service has are service oriented we are becoming a platform company, music, podcasting and other tools and services for creators to monetize. that's kind of point one point two is when you look at the landscape for us, it hasn't changed very much. one of the things you see in the other streaming companies is competition is really changed. so many new entrants into the market we had competition since we started. back five, ten years, some of the biggest tech companies in the world. nothing changed a market dynamic. we had to compete for a long period of time that's where we have been all along. we look at our business model is different. we are investing original content but not solely reliant on original content. it's in our engineering, it's on the playlists and the algorithms that you have. that's a big differentiator. multiple revenue streams,
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subscribers and advertising and. we are in a market that is massive. audio is undermonetized and a huge opportunity for growth. >> i have a feeling it's not the first time you made that case today. >> probably not. >> paul vogel, thank you taking the tough questions cfo of spotify we are getting breaking news on bill wong. leslie picker with the details. >> sara, yes as you recall he was arrested earlier today in connection with an indictment surrounding the blowup of ar kago, his family office we are learning from several reports he was released on $100 million bond secured by $5 million cash bail he was released after he had been indicted, as i mentioned, with several charges, including racketeering conspiracy, securities raud, wire fraud. that of course stemmed from the blowup of the family office which took place in march of
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2021 led to about $10 billion in losses from major wall street firms. >> thank you for the update. here is where we stand in the markets in this final half hour nasdaq remains positive. we lost a little bit of the gains. the dow is you up 142, s&p up 0.4, small caps are underperforming today. you have some notable strength in some of the earnings winners, materials are getting a nice bump up today, so is technology, energy, staples and industrials. is barbie about to get swept up in the record private equity buying spree that's the buzz on wall street the details next
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what's wall street buzzing about today? mattel which makes toys like barbie and hot wheels has held early stage stocks with private equity first responders for apollo a record $944 billion in deals announced in 2022 and a deal for mattel would make that number jump the stock is up 14% this year. it soared 80% became he became the ceo in 2018 and a market company of nearly $9 billion he said it's now in growth mode and completing the turnaround which makes it interesting that it will be approached by private equity mattel is set to report earnings
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after the bell we will get a better sense of that growth and perhaps new details about any deal talks that are happening and a better sense later. don't miss jim cramer's exclusive interview with the ceo. that's tonight on "mad money" 6:00 p.m. eastern. shares of meta sinking right now ahead of results after the bell now down almost 50% on the year. we will ask an analyst with a buy rating on the stock. what do you expect to hear from management. and we take you inside the market zone. plus a little bit more steam dow up 120 as high earlier of 457 we'll be right back. fo
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bell" market zone. mike santoli here to break down the crucial moments of the trading day. plus phil lebeau on bogey's sell-off steve cokovac. the nasdaq just went negative on the session. the broad market picture right now, stocks mostly in rebound mode after yesterday's big sell-off, but we are coming off of the best levels and selling off into the close dow up a 457 at the session high the nasdaq negative, sort of unchanged right now. mike, a lot of people have been watching the credit market as a leader it turned us around yesterday and it seems to be giving us a signal today hya is lower what do you make of what's happ happened in the last hour? >> backed off 2:30 the high yield etf did. people a little more nervous it coincided with the headlines that apollo would be buying in carvana dead issuance,
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restructuring the financing in the junk bond market to get more capital in there i assume the takeaway from this news is that, you know, they had a struggle, had a reset term, apollo getting ten plus offpercent and reflecting on weakier demand for riskier credits and an apprehensive markets right now i wouldn't say credit has been the main point, but it has eroded as equities over the last few months and right now today it's one of these days where a lot of movement back and forth but nothing much has been settled because we are trading entirely today within yesterday's range so it seems as if there is a lot of apprehension, very low conviction, the market's got to move around through these air pockets to find buyers and sellers. >> s&p up a little thless than half a percent bo boeing the biggest loser a big revenue miss because of highest costs for commercial and
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defense aircraft burping through more cash than wall street expected it's taking 79 points off the dow right now. phil lebeau spoke with the ceo earlier this morning about the disappointing results. listen. >> messier quarter than any of us would have liked. familiar themes. supply chain constraints, covid, inflation have just disproportionate impacton our company in one specific area, and that's our affixed price development contracts that we do with our defense business. >> phil lebeau joins us now. i am sure you have been digging through the questions all day long what is the main problem here with travel and such a strong period and also defense spending up so much >> well, let's take two parts of that first on travel and the commercial business. they are not delivering 787 dreamliners. that hurts the intake of revenue. they are also pulling back in terms of production for the 777. so now you have a company where
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half of its commercial business, a good chunk of it is not performing and then on the cost side paying $1.5 billion in charges that i am not sure wall street was expecting and he alluded to two of those being real problem areas one hyers costs for air force one, and the t 7 a trainer jet, both of those are fixed cost problems you enter into the contracts, you have to deliver at a certain price. inflation kicks in, you are dead in the water he said on the conference call with analysts, yeah, we probably shouldn't have entered into the agreement with air force one they entered into that, by the way, with the trump administration >> so is it a boeing problem or a macro problem? i know it's a little bit of potato how much of a tell is this because you are covering some of these other industrials and transports and the outlooks have been better. >> right the out looks have been better inflation is hitting boeing like all of the industrials right now. there is the macro part of the problem for boeing
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but there are some specific boeing problems. we alluded to the issues when it comes to the 787 dreamliner. yes, they have submitted a plan to the faa for certification and resuming deliveries of the dreamliners. who knows when that's going to happen they think the second half of the year they have 100 dreamliners, 100 planes in inventory built that need to be basically certified before they can be delivered that's a real drag on the cash flow. >> yeah, wow, 100 of them. phil lebeau. on the flip side of the microsoft's a big dow winner after they beat wall street earnings estimates forecast fourth quarter revenue for the three business units ahead of expectations. steve, microsoft reporting 46% cloud growth in the quarter which was also the same growth from q2. i guess not a big concern there about a slowdown >> there was at first. the stock immediately went negative when this report came out after hours and today we see
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what's happening but, yeah, that is the concern around azure anyone would love their business go growing 46 to 50%. that's not going to happen what they said on the call is a lot of the growth came from just this pandemic demand as more companies tried to digitize how they work and but they don't see that ending you anytime soon satya was talking about on the long term, we got like a decade to go of this digital transformation among businesses. so they are incredibly optimistic about the growth prospects for a z u russianre but the growth is still there. >> i agree i read that first answer on the conference call from satya nadal saying his conversations with ceos, they are not going to cut the i.t. budgets this time they are looking at this digital transformation and prioritizing it is there a strong read through here for amazon and any of the
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other competitors? >> well, one thing that stuck out to me on this call and i was talking about this earlier is the china warnings and we all know microsoft not a hardware business, they are a software business, but make a little hardware there is the xbox video game consoles, surface computers and other computer makers in china to sell windows licenses, too. there is some warnings about that if the covid shutdowns extend to may could be a problem for the windows also hurt the gaming business as well. >> thank you very much for flagging the china issue the other reason the dow is outperforming besides microsoft is visa, adding 84 points to the dow. beating analyst profit and revenue estimates thanks to a surge in payment volumes very strong domestic spending and a travel rebound kate rooney joins us now how important was that cross border which had been a weak spot during the pandemic >> that was a big part of this
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beat for visa, cross border is visa's most lucrative side of the business, highest yielding and that grew 38% year over year a bright spot and something that has been a drag on visa and the payment companies. they talked about traveling to places like europe it really is the strength of the consumer they talked about inflation, yes, it's there, but he doesn't see it weighing on consumer spending which is also very strong in the quarter. people are spending more, want to travel more and it's helping cross border. >> i learned from jim cramer this morning that russia is the biggest second credit card market in the world. so clearly an impact there how is it affecting these companies? >> it's interesting. i was told that visa hmay see that as a lagging effect, we may not see that show up for a couple of quarters al kelly saying we are through that uncertainty and macro
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uncertainty as far as that really being a surprise to analysts and it's a decent chunk of their business but again he was saying despite all of this they are reiterating guidance. they will talked about strength of the consumer and it's a bigger part of the business than you would think, but he seemed to be confident and optimistic when it comes to outperforming even in the face of a slowdown and not having payments at all in russia. >> yeah, clearly he is getting rewarded for it. mike, what do you do with a stock like this? clearly, it's higher today al kelly did innot take the bai. no slowdown even though the market suggested otherwise what does it mean for visa and the group which has been so slammed on sick iscal concerns >> it's fascinating. i think visa and microsoft are similar in the sense that not all that changed with the path of the business along the way. what happened is after early 2020 they went from merely slightly expensive stocks to incredibly crowded and people
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ramping up to 35, he hey exist record and that bled away. concerns about consumer spending trends and cross border activity is weighing on visa, but it's much more about hedge funds were willing to pay at the highs versus now because payments was a massively crowded area in terms of tactical money. some hedge funds, military ebuild ones, it was most of their book and that's backed away, fintech and payments >> kate, what does it mean for paypal which reports after the bell today >> it's interesting. paypal has been an outlier when it comes to things like inflation and hasn't traded really with the big credit card names. guidance is the biggest thing for paypal wall street wants to know what's in store going forward paypal, for instance, scrapped the net new active goals last quarter, completely got rid of it the cfo is also leaving for
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walmart. and some of the risks that paypal talked about when it comes to 2022 guidance, inflation, russia, lockdowns in china, none of which were a drag on visa or amex. we will see if paypal is a different story. >> it's not up in sympathy with visa down another 1.4%. thank you. mike, paypal is right there with netflix on the worst performers list of 2022 who would have thought those would be the worst performers and occidental petroleum would be the best? >> absolutely. this real sharp down scaling of expectations for earnings is very, very hard to own these growth names while the estimates are going down and they have been going down pretty quickly, you know, for 2022, the number has gone from 521 to 462 next year i mean, just not to say that the value is not going to be there at some level, but i think that that has been happening until people get confidence, you know, they stabilized it and the big picture opportunities are going to be more tangible for the
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company and, you know, again the unwind of the massive fintech trade is weighing on the stock. >> speaking of the unwind of massive growth trades, meta shares under pressure, down 3% ahead of results after the bell. now down 48% on the year joining us internet analyst at mkm partners you have a buy rate ing on meta. the latest numbers out of snap, netflix, alphabet don't inspire a lot of confidence about what we are about to hear from meta tonight. what do you expect >> absolutely. i think the expectations for meta have been declining and have been declining, even further after the three companies he mentioned reported. google, snap and netflix i think they talked about pressure from ukraine. i think the expectations for 2q guidance revenue growth probably lower. probably going to be what matter
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the most also, commentary around what is happening with tiktok, what is happening with apple and idfa. those two topics are front and center apart from guidance, which i think is not going to inspire a lot of confidence. any quantitative commentary is tiktok still affecting them and is apple still affecting them. if so, how long and what is the plan i think that's what's going to matter to turn the stock around. >> how much are these companies -- i know you cover alphabet as well and have a buy rating on that, facebook, too, how much are they affected by a slowdown in europe, in global growth, in foreign exchange, these issues which they are clearly susceptible to, which the market should have known niemt sure the google numbers were a huge sthok. how susceptible are they if we go deeper into these problems? >> either way, each of those problems europe adds a couple of
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points fx adds a couple of points and only you have other headwinds like what is happening at apple and what is happening with comparative headwinds so each of these when you add them up all together i think for a company like facebook, it cuts their revenue growth into half almost, or even even more the amplified effect is what is shocking people right now and i think that's where the -- estimates is taking an even deeper knife and i think we have there, if you are looking to look beyond, say, june, july, august for these companies, i think you come back and say, okay, facebook close at $150 was a very, very good buy. i think we are not there yet, but i think we will be probably at some point in the ongoing time. >> you are sticking with buy on both but olowering targets is that the story? not -- only lower targets on
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facebook last week our target is still at around $315 what i'm trying to say is at current levels, so long as you are looking to look beyond the macro, fx and things happening with facebook, it feels like a highly -- risk/reward. there is downside risk, but it's highly symmetric. >> thank you. we have two minutes to go in the session and, mike, a lot of the sectors that were higher at the start of the hour have turned red like health care, financials and utilities what do you see in the interims now? >> they have been holding up because we had that strong rally in the morning the market phas not turned too negative before two to one to the positive side and now almost even advancing versus declining volumes. wanted to check in on crude oil. it's kind of out of the headlines a little bit because it has not been making new highs. look at this pattern just this kind of triangle, right? sort of an indecisive pattern,
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sort of lower highs, higher lows at some point it has to break. the bulls are saying it's hanging around 100 trying to talk about shutting down, maybe that's a good thing. watch for the next big break from that one. the volatility index is down a point and a half, it had been down more than three points earlier. it's apprehensive. we are not want to go get in the way of a potential megacap earnings downside surprise and you think that's why people are traveling light going into the close. >> meta out in a few moments amazon and apple tomorrow. as we go that the close the gains are slipping away. so much for a rebound. up 75 points on the dew and that's largely thanks to microsoft and visa, two earnings winners. salesforce having a little bit of a bounce. boeing and j&j lower along with the financials like j.p. s&p 500 strength in energy wti above $100 a barrel. materials, technology remains strong, some rebound there and in some of those nangs
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communications services under a ton of pressure off alphabet and meta real estate utilities financials health care now all lower. the nasdaq goes positive at the close. just barely. small caps down a third of one percent. that's it for me now into overtime with scott you just heard the bells post 9 just getting started. our take of the tape decent rebound for stocks sort of fizzled at the end. still a ton of questions about where this market is going with critical earnings reports either imminent or still to come in the days ahead meta, qualcomm, pinterest and others hitting any second. we will get to them. of course, we will show you the immediate stock reaction across the board. our experts are here as well halftime's josh brown, ceo
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