♪ ♪ hi, everybody. welcome to "power lunch," along with kelly evans i'm tyler mathisen coming up we have google searching for answers. alphabet slusing there 150 billion worth alone. the company thinks the stock is a buy from here. >> stepeaking of disasters, lyft getting crushed, losing a third of its value we will dig into the core of what happened and get our traders to take on whether it looks attractive at this discount let's check on the dow and the s&p, close to break even, but the nasdaq taking a hit as interest rates continue to rise.

christina parts nef loss, dom chu looking at it for us take it away >> newell brands up by 10 cents, up two-thirds of the lows of the session. at one point it was down nearly 8% after the consumer goods company behind everything from rubber made stores to coleman camping gear and sharpie markers. top analyst estimates for quarterly results but gave a disappointing forecast a rough week for communication services which is worst performer, down 6% on the week consumer discretionary side down 2% to 3% technology down between 1% and 2% those three make up nearly half of the entire s&p 500. but it is not all of that. rising oil prices made the week a good one for the energy sector, the only positive performing sector this week. oil prices continuing to climb right now as you see after

russia said it will cut oil production by half a million barrels starting in march. that's likely one of the reasons one of the stocks trading at record highs is exxonmobil it is right around session highs, they're up about 6% just in this week alone keep an eye on that record change in exxonmobil let's turn to krichristina part nto kristina partsinevelos. >> up almost 12% after topping estimates, it is the best day for decks com since last october. but lyft is the one getting a lot of wall street attention at least nine downgrades i got in my inbox after posting week q on guidance despite signs of recovery in the rideshare market it plans to cut prices to attract customers. down 36%, the single biggest drop for the company

it is down about 85% since its ipo. and sin web bush for example said out of thousands of conference calls they've listened to over the year, lyft's call was the top three worst call, and they say it faced an everest-like uphill climb to show growth competitor, uber, down only 4% guys >> kristina, thank you very much it has been a terrible, horrible, no good, bad week for google the tech giant lost over $166 billion in value since its chat box shared an inaccurate answer on wednesday google off to a rough start in the battle of the bots our next guest says not to write them off just yet. jason is here with our own steve covac. great to see you back. jason, i'll begin with you a lot of investors are quick to jump to the same conclusion,

saying, wait a minute, they're the dominant player, they have time to catch up how did they get it so wrong and why do you think they can still right the ship without major changes? >> we think they've been focused from an a.i. perspective on how to use it for enterprise clients, effectively building a.i. models that their flan was to make available to enterprise clients who take their first data, layer it into a.i. you know, use that to replace human functions, come up with plenty of examples for you, and ultimately say you need to be a google cloud customer to use this a.i we think that's where they were focused. clearly microsoft is going in this consumer direction and google's alphabet's a.i. was not trained to be able to do that. it doesn't mean they can't do that >> why do you think -- >> but they obviously need more time >> why did they rush it to market in this awkward fumble of a roll-out if it was never

minute to have that functionality anyway i mean they should have listened to their own knowledge about it then and handled the situation completely differently they look vulnerable and weak because they rushed it to market, didn't seem ready, didn't have a great response when that went wrong people are saying the ceo should like get major overhaul. it is a major disaster for them. >> i cannot explain why they rushed it to market. i mean, you know, clearly you laid it out. historically they made major announcements at their google io developer conference last year it was in may. perhaps it was the original timeline and they rushed it to try perhaps to appease investors and this is now what we're looking at >> how unnerved is google, steve? >> well, we know what is going on internally right now. in fact, our own jennifer elias just put out a report saying on internal google message boards employees are firing back and

they're devastated over how the roll-out went. i will read you one quote by an employee widely red. rushing to market in a panic saying we rushed it out, everyone thought we were behind and we basically proved them right that we are behind that's what they're staying. look, we know reading the tea leaves, "new york times" reported that the founders of the company kind of had to swoop in and tell the ceo, we are getting our lunch eaten, we need to do something now. from the founder level you have that pressure. the investor level, you have that pressure. you have to wonder if they didn't rush it out and got it right first as it sounded like they wanted to do, would shares be as bad. >> you think the current ceo wanted to go slower. >> he stead internally i'll report back to jen's wonderful reporting again. internally he was telling employees we want to wait until we get it right, perfect it, we

don't want to rush anything out and then they did and look what happened >> do you think he was overruled by sergie and larry? >> it is hard to know but they came in and stepped on the gas, for sure >> what is next for google and alphabet what do they have to do to get back on track and regain the momentum or upper hand here? >> i think the realistic expectation is they need to take their time and show us what their a.i. can do at their io event, and obviously they're not going to rush the next version of this. you know, also i think it would help the stock is to talk about what the business model is what i start with is this idea if they really do have the best a.i. technology and the plan is to make it available to enterprise customers for their own data, training a.i. is kind of what we are talking about, right? that open a.i. trained their a.i. to think about kind of like what would a consumer ask a.i.

looking at the open internet, right. and perhaps google wasn't focused on so i would like to see them talk more about the business applications of a.i. help people understand -- and, again, they posted blogs about developments and papers they pu published and breakthroughs. but most people are not talking about the business application of barred and chat gpt it is get excited about the technology behind it i would like to see that but my guess is we will have to wait for probably the io event. >> yeah. it is really interesting we were talking, a couple of producers and i were talking before the program about the implications for customer service of using a.i is going to make customer service better or worse? more frustrating, less frustrating? i don't know time will tell we will see. steve, final thought quick >> to your customer service point, google has demonstrated exactly that you can talk to a chat bot and

make a reservation and things like that. they've been toying around with this for a while, they just haven't really released it in a broader, significant way that's why microsoft -- and microsoft has. that's why we're seeing the shine around bing all of a sudden and google looks way beyond >> thought leader but not the bot leader >> exactly >> jason helfstein, thanks chinese companies are getting in on it as well eunice yoon joins us from beijing with more. eunice, how far along are the chinese companies compared with google and microsoft. >> reporter: they announced they would be launching their own a.i. bot next month based on the search engine technology there are other big tech names jumping in as well alibaba said they've been testing a chat gpt-like tool

also tencent, j.d., all made announcements saying their experimenting with the technology, trying to advance their own research for this type of tool or looking at ways to incorporate it into other areas of their business. so you could see that the motivation is there. some of the smaller a.i. companies that have been tinkering in this technology already admitted they are generations behind open a.i. in fact, a state media today "the securities time" had an editorial where they were lamenting the fact chinese technology companies were lagging behind they've been calling on technology companies to bridge the gap with the u.s., saying some of the challenges chinese companies face is they haven't been focusing on large-scale modelling, or language modelling in the same way that the americans have been. also that they face other challenges such as weaker chip

computing power as well as a lack of training and investment. so a lot of challenges for the chinese companies even though they want to be there and catch up and compete >> mike, one of the questions i might have, eunice, about using a chinese-based a.i. interface of this sort is how unbiassed and pure could i ever expect the answers to be. if i'm asking -- >> reporter: yes, exactly. and that -- right, no, you're absolutely correct to have that kind of a concern. in fact, a lot of the private entrepreneurs who are in a.i. would say that that is a huge obstacle for them if they look to move beyond these borders so right now the experimentation is what can we do in the china market, what would we be able to do in the global market because there is that trust gap. i mentioned the state media report today, but yesterday the state media was warning

investors for jumping into the stocks of a lot of these companies, especially the local ones, calling it hype. they said you shouldn't be investing in these companies because, you know, they may or may not be able to produce anything firm. in fact, those companies were saying, oh, actually, you are right, don't invest in us. we have -- you know, we are having some issues there's no revenue generated when you so the hand of the government jumping in so often in private business it raises questions about state control and censorship >> sure does eunice yoon, always fascinating to talk to you thank you for being with us. appreciate it. all right. coming up, i'm going to turn around here, there we go how was that you know, the fed can pivot but i can pivot, too, baby all right. are the markets fed up with jay powell and the fed now that powell has signalled deflation is starting? will investors turn their focus to something else? will earnings take center stage?

plus, the stock draft season coming to a close. it is our contest. the stunning rise in netflix shares, staking the actor ryan reynolds to a huge lead with only two hours left in the contest. we will break down the winners and the sinners as we prepare to crown a champion today "power lunch" will be right back we all have a purpose in life - a “why.” no matter your purpose, at pnc private bank we will work with you every step of the way to help you achieve it. so let us focus on the how. just tell us - what's your why? i know the markets have gone up and down, but you're right on track to reach your goals. my ameriprise advisor helps me feel confident about my financial future.

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welcome back, everybody. the major averages on track now

for a losing week. investors trying to make sense of the most recent interest rate hike the latest batch of earnings and economic data. what is going to influence this market the most going forward? let's bring in cnbc senior analyst, ceo of contrast capital partners ron, we have been focused for the last year on the fed and what it is going to do there's various times lots of suspense some of the suspense air seems to have gone out of the balloon at least right now >> i don't know about that you don't think we kind of know what they're going to do >> well, you know, the market is getting a little jittery again larry somers changed his tune from where he said the fed should not commit to a future rate hike or rate change in policy he is saying we could see a resurgence in inflation and they may have to do more than currently thought by wall street the fed is calling the tune no

matter what. i think the markets writ large are focused on what the fed is going to do. >> do you agree with that, mike? >> i have a bit of difference of opinion. i think that powell has declared the disinflationary process has started and inflationary process is rolling over. i think investors will quickly turn their attention to the impact of the rate hikes on the economy, earnings and the labor market tyler, i think the biggest challenge for the stock market going forward is that margins are getting crushed. now the net profit margin for s&p 500 companies is below the five-year average and well off its peak from a couple of years ago. so now that inflation is falling, there's a limit to how many price increases companies can pass on to their customers, yet their costs remain elevated and their margins are falling. i think the key here going forward for markets is which companies, which sectors and

companies can expand those net profit margins which ones are growing i think that will be the key there's only four of eleven sectors that are currently in line to increase their net profit margins year over year. >> mike, would you say the business cycle is rolling over and if so, what does that imply for if the fed should continue to tighten policy here >> well, i do think that's one of the biggest risks to markets, kelly. ron highlighted it i think that the market anticipates the fed to raise rates a couple more times. if they have to do that more than expected, i do think that poses some more volatility and more downside risk for markets in that case you are more than likely to want to own your defensive positions. the problem is those are a bit expensive at this point, and a lot of their fundamentals are beginning to roll over so i would prefer to be a bit more cyclically oriented in areas that can expand their private margins, energy, real estate, industrials. nos those are three of the four sectors increasing net profit

margins year over year >> ron, i'm watching your body language you don't see persuaded. >> i just don't know honestly, for the first time in a while i have absolutely nothing new to say i just really -- there's something out there right now -- >> take the rest of the day off, ron. it is all good with us >> i have been complaining the fed has been too aggressive, i have argued inflation is rolling over i don't know there's much else to say at this juncture. you look at atlanta's gdp, estimate is up 2.2% from 0.7%. as much as we've been worried about risk of recession, obviously the employment number, the strength of the labor market suggests maybe a soft landing is possible so to me we will chop around both in terms of market terms intellectually for a while until we get better answers and better data i think it is really tough >> the scuttlebutt on twitter is, hey, did you know you can get 5% on -- >> absolutely you can. >> you don't have to pay state income tax that's where people are looking. the earnings recession, a questionable economy, pockets of strength, you know, maybe the treasury market looks better

right now. >> first time in 14 years you could get a decent yield >> decent yield on short-term cash >> bonds we don't default. >> the six-month bill is a higher risk. but they're only a basis point a part, 4.93 and 4.92. >> ron, we will have you back in a couple of months when you have something to say wake up. >> it is a difficult environment. >> i got you >> you can make the point until you are blue in the face and it doesn't mean anybody necessarily, at the fed, is going to agree with you. >> ron, thank you very much. mike arone, thank you very much as well. tyler mentioned that customer seems two steps behind. we have one company using my ging a.i. technology to tr toake better chat bots that's today's working lunch stay with us stay tuned to learn more about this limited time offer.

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welcome balk to "power lunch," everybody. the dao hanging on to a 100 point gain today you are seeing the mirror image of what has happened this year the nasdaq is down 100 points as the ten-year yield snapped up to 3.73%. pretty extraordinary over in the oil market we are seeing gains today and this week, up 2% today after russia said they will cut output by

half a million barrels a day again, strength in the energy sector for the week. it is a notable standout let's head to the bond pits in chicago. rick santelli is standing by rick, what is going on with you? >> you know, yields, we've been monitoring technicals since the jobs report. once we had the jobs report everything changed technical note yields major resistance and 380 look at the two-year for the week it is up over 20 basis points and it was instantly responsive after the jobs report. if you look at the vix it didn't wake up until yesterday. matter of fact, if you look at november 1st both of them together, the yields gave you an early warning sign on the vix moving higher. to that end paul aaronson. can you talk >> sure, rick. >> paul, we're basically looking at the vix it was rather sleepy after the big jobs report last friday. it didn't really wake up two-year note yields and san bernardino conflict of treasury

popped immediately why the lag and how are we looking at next week's inflation data >> i think we are seeing the markets finally saying it knows what it doesn't know after the big jobs number gave the fed a lot more leeway in how they're going to take this rate path, and over the course of this week we are seeing the vix telling us the market needs to pay attention to what is going on, particularly tuesday as you mentioned. >> cpi is coming out tuesday what is fascinating there is we have benchmark revisions they didn't change much year over year but made some of the numbers hotter, especially core. >> core will be important. we saw higher than expected in the michigan sentiment numbers this morning any heat in these numbers on tuesday will really give the fed impetus to possibly exceed our expectations on rate hikes >> fed fund futures as of september which is the fulcrum looks like it is on a new low close. every new low close brings in more fed thank you, paul.

back to you, tyler >> thank you very much, rick santelli let's get now to seema mody for the cnbc news update hi, tyler. good afternoon here is what is happening at this hour. the first police officer to confront tyre nichols before he was severely beaten was reportedly accused of brutality seven years ago. the associated press says hailey was accused of taking part in a savage beating of an inmate in 2015 the assault was so disturbing 34 other inmates, everyone in the cell block signed a letter to the corrections director florida governor desantis has been granted effective control over the district where disney world operates. the state legislature passing a bill giving desantis the authority to appoint all five supervisors of the district. support for the bill came together amid desantis's ongoing feud with disney as he cracks down on the company for being what he says too woke. and federal regulators are seeking to lower power and water consumption by household appliances new rules proposed by the energy

department would save americans an estimated $3.5 billion a year and reduce green house emissions. it would affect refrigerators and washing machines back to you. >> thank you very much, seema mody ahead on "power lunch," the business of the bold there's more than a championship on the line this week. billions of dollars, of course, surround this bill game, whether it is ads, gambling, tickets, food we will break it down for you. luckily for those of you watching from home, you might pay a little less for snacks and wings than you did this time last year. jane wells has that story. hi, jane hey, tyler it is another reason to party. wings' prices down what about the flu avocado under a buck a piece what year is this? we will have that story and why i have a jalen hurts fat head behind me when we come back.

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welcome back to "power lunch," everybody. super bowl lvii, if you can believe it, between the philadelphia eagles -- jim cramer's favorite team -- and the kansas city chiefs, just two days away. it is expected to be a record-breaking one when it comes to gambling with more than 50 million people expected to bet $16 billion on the big game. here with more on what's at

stake is patrick risch, director of the sports business program at wash university in st. louis. patrick, welcome good to have you with us let's talk about the effect of gambling not on this game but on television ratings what you expect to see the fact that gambling has risen over the past few years flow through to higher viewership? >> absolutely, tyler thanks for having me on. we already saw it last year, where last year's game had 112 million viewers which was just shy of the record viewers of the 2015 super bowl between the patriots and the seahawks. the dynamics is very simple. the more people that are betting on these things, they are more likely to watch. i think the american gaming institute had some statistics that basically said that millennials and gen-zs in particular, over 55% are more likely to watch the super bowl if they placed a bet so there's no question when you bet on something, you have more stake in the game, more

engagement and you are going to watch. >> and who is going -- for example, all of the parlays, who is going to score the first touchdown. it will be travis kelce, i'm telling you that right now >> that's a good bet >> anyway, let's move on i'm interested in ads. they're sold out again i think it is $7.5 million per 30-second spot that's an astronomical number. i wonder whether the ad value and novelty of the ads is the same as it was a decade ago when we spent the week ahead previewing what was the best ad. i don't know people seem to care quite so much anymore. >> you know, tyler, there's not the same shock factor i think you are alluding to. >> right >> because now people are releasing the ads sooner, but there might be a method to that madness and let me explain one of the things -- like last year, sofi, they got 74 seconds of visibility during the actual super bowl itself, but that is minimal impaired to all of the amplified effects that they get with tweet posts and instagram

posts and pregame shows and postgame shows the week leading up after the game. we have to realize there are a lot of amplified opportunities on social media and other television where these brands are getting a lot more exposure. i think they're still getting their money's worth even at that price point. >> although i think the data shows, patrick, the ones who get the most bang for their buck are the ones that do it consistently, to your point. no one remembers the first off except for foibles, we all remember how bad it was for crypto after last year it is like if you are the one-off guy, it is like, wait a minute, why is this company so desperate throwing this money at it the budweiser, the pizza hut from back in the day, those are the advertisers you remember over time, and it get expensive to do it year after year after year >> there's no question by the way, even though fox sold out their super bowl inventory, they did it a lot later than normal part of it, as you mentioned, were the cryptos had a big roll last year because of the

bankruptcies that have taken place, they've gone away there's more uncertainty about the economy, that kept some away lastly, supply chain issues. some of the companies had new product lines they wanted to promote but couldn't because the supply chain was behind. so fox sold out their inventory but it was slower than usual >> patrick, fan at that time tick to see you again. patrick rische from wash u which is a hot school these days everybody wants to go to wash you. >> why not >> why not i have to tell you, st. louis is a great town >> we have one of the best sports business programs in the country, too >> which is what my son is interested in. we will talk, patrick. we'll talk. >> give me a call. >> thanks, man tunk from the super bowl game to the super bowl party, we had a lot of inflation since the rams beat the bengals last year. how is it playing out with the staple food and entertainment items. jane joins us with news on that.

jane wells. >> reporter: hi, kelly i ordered some things. my fat head of jalen hurts arrived. my full-size cutout of patrick mahomes from party city is not getting here until 7:00 tonight. i'm not taking sides in the game moving on to food, food is up 7% from a year ago because of inflation but some foods are cheaper. let's look at your super bowl spread first, speaking of cheap, cheap, chicken wing prices are down 39% in a year at the retile level, 64% at the wholesale level the national chicken council, which is a thing, predicts americans will gobble up a record 1.45 billion wings this weekend. what about the bird flu? of the 58 million chickens that caught the flu over the last year, three out of four were at egg-laying operations. that's why eggs are so expensive. only 5% were poultry raised for meat, one reason maybethese birds were younger than egg-laying hens and therefore less susceptible to the flu.

plus, tyson says we have a meat glut, beef, pork and chicken driving down prices. more amazing to me what is happening with avocados. always, always expensive, but this year they're down 23% from a year ago because of a bumper crop in mexico thank you to that. g guac lovers will be happy. corn chips are still elevated, so the tortilla chips could be a little more expensive. higher, cheese for the pizza, up 23% from a year ago. hold on to your six-pack americans may be drinking less beer, which almost seems unamerican, but beer prices just in january are up 7% according to bump williams consulting. malt liquor prices are up 9% from a year ago. this king cobra cost me $4 for that i could get four avocados it is crazy. this is madness, guys.

>> well, jane, one of -- so many things, but just to bring it back to our audience somewhat, why is there a meat glut is that telling us something about how all of the shortages in the pandemic have turned into gluts? >> well, things do kind of do boom and bust, but particularly with beef. ranchers weren't making all of that money during the pandemic because they couldn't even get their cattle to the processing plants because they were shut down so they were losing money. then they had the drought. then they have higher feed costs. what they've been doing and they warned they would do this, they are sending cattle to slaughter earlier, some of them, and that created the glut right now it will work itself out eventually as it always does, but that's why tyson was caught off guard. there's just too much meat that will help you in the grocery store. >> is that a 40-ounce king cobra you got there, jane? is that a 40 >> it is a 32. i have never had malt liquor in my whole life.

i remember those crazy colt 45 ads when i was growing up. >> yeah, schlitz malt liquor i remember a really bad evening with this. >> have you had this >> yeah, i just wanted to see it hold it again. give it to jalen hurts over there. >> give him a swig >> thanks, jane. still to come, john ford bringing us his interview with the ceo of an a.i. customer service startup. "working lunch" is next. the bond report is brought to you by --

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♪ ♪ welcome back to "power lunch. i'm dominic chu. we want to call your attention to breaking news we have out of washington, d.c. where the department of defense right now says it was tracking a high-altitude onto over alaskan u.s. air space in the last 24 hours and the object was flying at about 40,000 feet president biden had ordered the military to shoot down this particular object. the object was flying, again, at 40,000 feet. it posed a reasonable threat, says the pentagon and says the biden administration, a threat to civilian flight out of abundance of caution and

at the recommendation of the pentagon, the military was ordered to down the object some more color on this. it is unclear. they are calling this an object because that's the best description they currently have right now. they do not know who owns it, whether it was state-owned or private owned, corporate owned or otherwise, where exactly it came from or whether or not it was a balloon. of course, all of this comes amid the news just this past week or so where the u.s. has shot down what was alleged to be a chinese spy-type balloon we are keeping a close eye on all of this right now. those are the headlines. this is a developing story right now, tyler, kelly, but that's what we have the briefing continues we will bring you more as we know more, but those are some of the headlines right now, tyler, kelly. back over to you guys. >> dom, thank you very much. interesting story. i'm sure we will follow it throughout the hour and the afternoon. it has been a big week, of course, for artificial intelligence with microsoft announcing it is taking on google in search with an open a.i.-powered version of bing

today john n fortt brings us up close with a startup company's c.e.o. who knows what it is like to be an underdog. jon. >> ceo of forethoughts, a company bringing together deeper a.i. into service. they have raised more than $90 million in funding and this week made g2's list of the best analytics and a.i. products. deon grew up in toronto and showed talent in basketball and computers. in high school he had to decide which to pour himself into, chose tech the early going was tough as only one of the black kids in his classes. when he started doing computer competitions, he lost, a lot >> you have contests every single week and i'm usually doing pretty poorly. i'm getting beat down every single day that i do a contest i'm not, you know, in the top one or two there's 100 people i'm in, i'm in 75, right so each of those moments are

actually pretty painful. eventually, you know, you have one big contest, another big contest, another big contest, and all of a sudden when you look back you're like, okay, i did it i'm 13th in the world at the olympics of computer programming, right so that was -- i've had many moments where i felt i couldn't do it. >> i caught up with deon last week to talk about the surging interest in a.i. technology and what it means for forethought. he told me he sees big opportunities for companies prepared to build industry-specific products on top of platforms like the one microsoft is offering. he hopes to be leader in support. >> we have seen it in the marketing world. we believe, and when we looked around we were actually the first generative a.i. company in customer support automation because we have been applying these models chsince gpt2 we believe the future is leveraging these, extracting the

complexity and building systems on top that learn from your specific data. >> that's a key piece. it is one thing for the large language models to be good at general conversation companies need them to be good at talking about their business and their industry that's why there's going to be room for a lot of smaller winners in the a.i. era of enterprise software, guys. >> amazing remarkable on a number of front. >> as i said earlier, we were chatting off line, a couple of producers and i were chatting off line one of the things that frustrates me is not being able to get a human being on the line when i call customer service, and they inevitably give me a menu of about nine items none of which ever, ever precisely hit on what i want to know is a.i. going to be able to do that, and as geno, one of our producers said, are they going to be able to troubleshoot my problem the way a human could? >> that is the promise of things like chatgpt, which knows how to talk well. >> it knows how to talk well >> but about what? very general -- what it is able to scrape up on the internet,

what you feed it the challenge is to know how to train it to talk about airline policy, right, if you are an airline and to know exactly what your husband istory is as a cust that airline who will be skilled enough to target airline industry, teach it those terms, feed it the data from a specific airline so it can talk to you, tyler that's where the race is right now. >> once you have the tools that can generate language and all you have to do is give it your business model, for instance, and then it can be more communicative, you can see it working across a number of businesses not just customer service but something like cnbc, if i'm up there typing in all of the data that we have access to and it is able to give me on-the-fly concept, what is the ten-year doing right now? okay, give me, what are the breakdowns it is more of a conversation you can see this being -- taking data in enterprise and wrapping it with a.i., you could see this powering the whole next generation of startups >> absolutely. right now there's a balance between book smarts, which is

one thing that you can teach something to talk generally, and then street smarts, of knowing about particular subject areas, the nuances of them and how to feel natural and actually educate or inform in conversation that's a challenge i was just talking to the ceo of freshworks a few minutes ago, right. they had earnings a few days, and they're also in customer support and he said that this moment for technology is similar to an iphone moment or browser moment when it comes to a.i. and he and his team are at work trying to do exactly these sorts of things. >> how impressive is deon nicholas himself >> yeah. >> a study in persistence. >> absolutely. >> just persistence. >> thank you, jon. we appreciate it >> thank you very much >> jon fortt. lyft getting cshrued, down 39%, but is now time to hitch a ride we have that next. look! what's up my trade dogs? you should be listening to me. you want to be rich like me?

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welcome back, and time now for three stock lunch. we're trading some of the big movers to the downside today, such as lyft, on pace for its worst today ever after that weaker than expected q1 guidance expedia on its worst day since may after poor weather hurt results. and u.p.s., flat today but on pace for its worst week since

december here to help us trade them all is shelby. let's start with lyft. is this a discount or a well deserved trim, shall we say? >> yeah, sure, so, in my opinion, i'd be looking at lyft as sort of a hold, and the reason being is that i would need some more time to see a little bit of proof from management on their capital allocation and their strategy to continue to deliver some sort of value proposition to allow them to maintain demand and to compete with their primary competitor, and that's uber. so, you know, with one quarter of underperformance, however severe, it's still -- i'm still willing to give hthem a little bit of room and say, all right, i'll wait and see, but what can you really deliver in this environment? can you gain back some share is management making the right decisions to leverage costs and to meet demand where it is or are we going to continue to see some sort of misallocation of capital and strategy that's going to say, okay, you know what maybe it's time to let go of that optimism and downgrade from

hold >> well, i get your hold there, because if you had said sell, i would have said, why didn't you tell me this on tuesday? some help. it's gone down 36% today let's move on to expedia fourth quarter results missed. they blame the weather is that a legitimate excuse for expedia, and what do you think of it? >> you know, i think especially when we're looking on an immediate term, on a one-quarter basis, i think it's important to go ahead and look through that sort of topline shrinkage a bit because weather really is out of management's control however, the reason i keep it at a hold is because once again, i want to give a few quarters to see whether or not they're able to catch up on volumes can they catch up to their competitor are they able to prove themselves when conditions are optimal? so, can't control the weather, but are they controlling what they can control can they catch up on market share, and can they do that in such a way that the return of

travel continues to work in their favor? are they aptly positioned to capture a return of demand for travel, and what can we expect from management in terms of leveraging the bottom line if that sort of return, that sort of recoup is not actually in the cards in the future for them >> right, you're a cautious until you get more on lyft and expedia, but i know u.p.s., you feel a little bit more strongly about, shelby, and which way would you go with these shares >> for me, u.p.s. would be a guy, and u.p.s. is a story of excellent management, capital allocation, and delivering of value proposition to their customers. and you know, making their tactical shift away from quantity of volumes and towards quality of volumes, finding clients that can meet them where they are, where they can impose pricing has been very important to the fundamental performance of the company you know, that said, we still have to consider the fact that consumer discretionary will play in a bit because of the proportion of

business-to-consumer volumes for u.p.s., and you know, we're continuing to wait and see on how the teamster negotiations will go, but so far, management has shown me that they've really been in control. i'm feeling very positive of their ability to come out of these negotiations with positives for everyone and they're continuing to deliver value and be able to give pricing in a way that makes me feel really good about their competitive advantage and market share going forward. >> shelby, thank you so much for being with us today. i don't know that i have met you before nice to have you with us >> thank you it's been a pleasure >> shelby mcfadden of motley fool >> i like when people say, welcome to the show or something like that. after this weekend, speaking of shows, we will have a new champion we're not talking about the super bowl champion. it's our stock draft coming to an end we always go from draft day to the super bowl we'll tell you who's winning, who's losing, ere erodwhevyby falls. we'll break down the rankings next power e*trade's award-winning trading app makes trading easier.

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much down to one, are the mountain goats that's ryan reynolds or the in fashion favorites, which is former macy's ceo terry lundgren those are the only two teams that even had positive returns burg that span so, when i say, two-horse race, it really is look at the performance gap. 30% versus 14% so, a factor of two there. pretty much this is ryan reynolds' win. >> he's done doesn't change >> unless netflix somehow hypothetically does something crazy in the last couple of hours. >> ryan reynolds needs a win, you know he doesn't have enough going for him. >> look at this. the mountain goats are 30% versus the s&p during that span, which is down 5%, but even terry lundgren, very respectable, any hedge fund manager would want this kind of outperformance. >> but mountain goats, that was ford and netflix >> that's right. and we will show that in just one moment so, if you take a look at this overall, this is netflix, which

is the best-performing stock in the ryan reynolds portfolio. that and ford. it didn't matter what ford did, because during that span, netflix is up a whopping 75% >> they almost perfectly bought it >> exactly we knew why ryan reynolds picked it there are three movies of his on there. the adam project, six underground, and by the way, check out some of the other ones chewy was the best-performing stock for the terry lundgren portfolio. that was up 41%, so a very highly respectable turnout there and again for a two-stock portfolio, not too shabby, but look at this it's not all about the winning that happens right here. there are some rough ones here, including seymour alpha, tim seymour. it was a run one, down 23% and then kandi & the gang. >> what were the culprits here >> if you look at the overall picture for some of the downsides for the stocks, it comes down to -- i'm not sure exactly what they were, but if

you take a look at the picture for why some of these things happened, almost every asset that was picked was somehow down in value it's just it comes down to netflix. >> it does >> talk about bottom taking the whole thing. >> seymour had paypal and dash >> look who's going to be with us on monday, 2:00 p.m ryan reynolds. he will be accepting his award >> major award >> thanks for watching "power lunch," everybody. enjoy the super bowl >> yes, see you monday closing bell starts right now. it is a mixed session for the major averages to close out a mostly down beat week as attention turns to tuesday's inflation report this is the make-or-break hour for your money welcome to closing bell. i'm mike santoli in for sara eisen. here's where things stand in the market the s&p 500 really been kind of twitching around the flatline most of the day, now slightly positive, did have a bit of a decline, less than 0.5% for the day. dow outperforming some of the defensive issues the nasdaq