number two, celgene to me made the first mistake they've made in the ten or 11 years we've been doingthe show. celgene traded to levels it held last year, 98 1/2, 99, back to 100, maybe that stock looks interesting though the ibb, although it's sold off significantly, it's still in a significant up trend to answer your question, yes >> i agree i would buy the ibb. i know i defend it all the time. you're going to see the day when big cap pharma comes in and makes significant acquisitions to put some juice behind this group. >> we saw that, and it didn't last >> gilead is one, people saw that as an all clear sign for things to happen you're going to see multiples. you need to see big combining. you'll see it. i believe you're going to see it >> we've been waiting for this forever. >> i know. that's what's holding back right now. >> but what are any waiting for? >> don't know the answer to that that's the question. >> that's the problem. >> there's a lot of egg on a lot of faces on this desk over this, certainly some here. we have very good balance sheets, very good multiples, and compan

. >> huntsville, alabama time to buy celgene or be awary?ink it's okay for bounce but i was dismayed by celgene. i've liked it a long time. >> peter from new york thanks for being here. ch chipotle is diving deeper. >> i've lost faith american way of trying to figure out when you've forgotten something, six months. my take is chipotle, put in the past, it's too close >> florida, take on cbs? >> think this one, cbs is dramatically oversold. people are too worried about amazon well run company, acquisition in managed care, stock will go higher i like cvs >> coca-cola for beginning long-term? >> long-term yes, good ceo doing a lot. my problem with coca-cola, kids say dad it's so bad for you, i'm not going to have it they need to diversify and debt something else going but new man is doing good job. >> norfolk southern? >> sensational. >> buy buy buy. >> that's a good one >> from michigan how do you feel about ibm as beginning investment >> think next quarter will be better sat down with ceo and cfo, i feel good but not great. all the companies

the ibb down about 7%, as there are concerns after earnings season, particularly for celgene, so kind of a bad time for drug stocks, people hoping for goods in now back over to you >>> pete, to you for the trade on bristol mire. >> actually i own merck, so that was a frustration for me. >> setback after setback. >> i still like the management, from the top down i like what they have. obviously there's pressure, and they're going well, in one of your best areas, i think that's something that's concerning. that makes sense merck is up for the challenge, i think, but this is clinical trials, these are trials that are going through the trials that is something that's very, very important, but we have seen them go further than this, and suddenly, if you don't get approval, then what? >> what does merck have to do in your view, though? the earnings disappointment, in combination with another drug. now what >> easy answer i think what we will see going forward in 2018, we will start to see the pharmaceutical space start to do some of the mao we're doing. >> finally >> we kicked it off with g

speak in a meeting and say something totally out of the blue we can rattle off the companies, maybe celgene being one. but i digress. you're going to know a lot more this time on monday. i hear what dan is saying. but you have to ask the following question what is the right multiple for general electric, a company with basically no earnings growth, as compared to a honeywell that's going to grow from 11 to 13% should they be trading at the same multiple? i've said no for quite some time at a certain point, you're going to find equilibrium in ge, i just don't think it's 20 bucks dan is giving himself time, which makes a lot of sense in the here and now, there's going to be some murky waters. >> just real quickly, on the event, you know, you're either going to get a capitulation, everything sounds nasty and you'll see a stock in the high teens, or the thing will continue to solidify and you'll like these sorts of trade structures playing for a move back to the 20s. >> check out our website, while there you can sign up for a newsletter, what guy reads every night before going to bed. >> damn s

maybe celgene being one but i digress. the point being, you'll know more at this time on monday i hear what dan is saying. you have to ask the right questions. what is the right multiple for general electric a company with no earnings growth compared to a honeywell that will grow from 11 to 13% should they be trading at the same multiple? i've said no for quite some time and you see the out performance of honeywell at a certain point you will find equilibrium at ge. i don't think it's 20 bucks. i think dan is giving himself time which makes sense in the here and now as dan said and mike said, there's going to be some murky waters. >> yeah, just real quickly on the event, you're either going to get a capitulation. where they cut the dividend and everything sounds nasty and you see a stock in the high teens or the thing will solidify and you'll see trade structures playing for a move back to the mid 20s. to me i like the risk/reward >> for everything "options action" check out our web site optionsaction.cnbc.com while you're

highlighted challenges for drug makers and specialty pharmaceutical companies regeneron, mylan, and celgene all lower on the day that does it for "squawk on the street," back downtown for the start of "squawk alley." >> thank you good morning, it's 11:00 in midtown manhattan where ge is holding investor day, 11:00 a.m. on wall street, and "squawk alley" is live ♪ ♪ welcome to "squaw alley. i'm john fortt here at post 9 with michelle caruso-cabrera, mike santoli, carl quintanilla, and sara eisen have the morning off. general electric, meanwhile, slashing its dividend in half. the first cut since the financial crisis, and it's shaking up its core business shares sliding right now down more than 4.5% morgan brennan is at ge's investor day in midtown manhattan and joins us now >> ge cutting its dividend by 50% in what is from a dollars and cents perspective the biggest reduction ever by a company excludeing the financial crisis, but the street expected that that's not why shares are falling right now. why shares are falling, because of the guidance, so new 2018 eps forecasts, a dollar to $1.07

tech space >> right >> pharmaceuticals is pretty big in that area as well, and the amgens and the celgenes of the world, gileads there is so much money overseas, people are looking at it saying, you know what, that could not only bring that money back but how about an acceleration back to m&a we haven't seen the m&a possibilities. where are they going to put the money? is it going to go back in the company? is there m&a as well >> what did you do today >> today is not a need for the market doing anything. the financials continue to do interesting. there's bottom fishing to be done in the retail sector. emerging markets have settled into a place where they continue to outperform every time we get a settling in on rates in the dollar if you don't believe we're getting this fiscal policy, the dollar can't get a lot better. >> i added to a spy short, i think i told viewers, i also took a little profit in bitcoin which is more than kind of lapped up by losses. i added to an smh, a semiconductor etf, short when nvidia turns, that will take a breather. >> the russell iwm, if they don't like -- if

line as well as bottom line earnings that disappointed on the mega cap biotech sector and gilead and celgenees this creates a window of opportunity. so we would actually look toward overweighting the biotech industry because we're quite positive on the health care industry as a whole. we think that the regulatory issues as well as government concerns are going to be a passing issue. as well as we would look at one company, in particular, which we have in our portfolio, amgen we believe this company is growing, profitable, well capitalized with very little debt and a lot of cash they'll have above market returns with much less volatility over the next 12 to 24 months. >> matt, is chad right to be optimistic about biotech >> i think so. i mean, one of the things people are worried about, are we going to get a repeat of what we saw in 2015 when the ibb crashed 40% in just six months the setup is much, much different than it was back then. that year, when that topped back in 2015, the group had wildly outperformed the s&p it was up 64% over the previous 12 months. versus only 8% for the s&p ther

highlighted challenges for drug makers and specialty pharmaceutical companies regeneron, mylan, and celgene lower on the day that does it for "squawk on the street," back downtown for the start of "squawk alley." >> thank you good morning, it's 11:00 in midtown manhattan where ge is holding investor day, 11:00 a.m. on wall street, and "squawk alley" is live ♪ ♪

had a little bit of exclusivity because they did the trials, but the real monopoly opportunity for celgene was the fda said well, because of this risk of birth defects, we have to have a risk management strategy to make sure this drug doesn't get into pregnant women. cell gene developed that pathway. they patented it so no one could create a generic version because there was a patent around it, and the fda went through a spate of creating more and more of these rems protocols that people could patent and therefore blocking competition. there's, again, a way to standardize maybe rems protocol so they don't have intellectual property around them, which will allow more generic competition. then this last bucket i want to focus on is the biosimilars pies. biosimilars have been accelerated in the marketplace as a result of a kind of a provision within the aca called the biologics price and competition innovation act of 2009. or bpci. that bill tried to create some measures that are like hatch/waxman so biosimilars can get to the market in a more standardized pathway, but the problem is it's not