Transcripts For CNBC Closing Bell 20140723

You can see were about two points, a little less than that, above that number right now. I know well be watching for the next hour. Yes, we will. Thats for sure. An hour from now, all eyes will switch to another batch of key earnings. Take a look who were hearing from, facebook, at t, qualcomm, all out with their numbers. And our Julia Boorstin will be speaking with facebooks chief operating officer Sheryl Sandberg immediately after the earnings are released. Stay tuned to find out what she has to say. Leaning in with Sheryl Sandberg, coming up. Another twist in Rupert Murdochs efforts to buy time warner. We now may know just how high hes willing to go to win the bidding and reshape his media empire. Or do we . Could murdoch just be posturing . He named a number today. We have david faber with a brand new detail coming up on that in just a few minutes. Yeah, shares of that company, by the way, have been under pressure today. Yep. Heres where we stand across the Broader Markets. Moving in Different Directions on the dow as opposed to the s p, backup four points today, and the nasdaq, which is up about 17. And interestingly enough, this against the backdrop, still, of low rates, bill. That is the theme. 2. 45 on that bond, the tenyear yield. There it is. Now 2. 46 , but yes, at those multimonth lows. Lets talk about this in our our closing bell exchange, cnbc contributor Abigail Doolittle from peak theories and Keith Fitzgerald from money map press, Steven Parker from jpmorgan private bank, Dennis Gartman is in the house with gartman letter, and our own Rick Santelli joining us as well. Keith fitzgerald, we keep hearing its all about earnings. What do you make of the earnings . Have they been all about this market right now . Well, 78 of the companies that have come in have reported beats. Youve got growth of 6 , i think its bottom line, 3 on the top line, or maybe i have my numbers reversed, because i was looking at them. Generally, productivitys rising, earnings are looking good. Its the rally Everybody Loves to hate, but if youre not on board, its an expensive mistake right now. By the way, the theme of the credit boom is something were following. Steven parker, little noticed perhaps to the broader public, but important today, the Money Market Fund ruling out of the s. E. C. Could mean a lot of corporates, for example, take their cash out of the funz. If they put them in some of the growing popular instruments like an enhanced cash fund that pimco offers, for example, the kinds of things that reach into different parts of the credit market for yield, could that continue to fuel this credit boom here and ultimately provide a wave, if you will, that lifts stock prices in the end . Well, i think, you know, its not just the corporate sector. I would hope were not moving too far up the risk scale for what were trying to do with cash in the corporate space, but without question, there is huge demand for credit out there. Theres a lot of liquidity in the markets, even as the fed is beginning to taper. Youve got Central Banks around the world who are still very easy. And because of that, because youre seeing the good fundamentals, the strong earnings that we heard, that weve been talking about over the last couple of weeks, credit markets remain very well supported, and we dont expect thats going to change any time in the near future. Dennis gartman, Rick Santelli and i were talking about the low on the euro against the dollar. Its a 52week low right now. I know youre paying attention to that as well right now. What do you make of it and what does it do to your investing right now . I think its the start of a bear market in the euro. It topped out quite some period of time some while ago, i think 11 weeks, if im not mistaken, it crossed 1. 40 for a few seconds and since then has basically been on offer. Given whats going on over there geopolitically in europe and given the very weak economic circumstances, given the extremely low levels of interest rates, i think money finally, continuously moves away from the euro and finds its way into other dollars, our dollars, canadian dollars, kiwi dollars, aussie dollars. Thats been the trend chinese yuan. And i dont see that its going to change. Rick santelli, to that point, does that mean here that fund flows are going to keep supporting u. S. Assets . And not just stocks, by the way, but real estate, which is getting more headlines across the country. Well, anybody who has cash, you talked about credit. Onethird of all the transactions are cash. So, even though low rates and big liquidity were supposed to help a big swath of america get access to credit and specifically mortgage andzs and houses, really hasnt worked out that way. But i do continue to think were going to continue to see a lot of these cash deals come into the marketplace. Its a good time to have a lot of money. With respect to the Euro Currency, i would put forth exhibit a, and that would be the dollar versus the yuan. Right now in front of their pmi, which comes out in several hours, and chinas looking to put a nice number on the board, we see the dollar at the lowest level since early april. I think when it comes to currencies, that we cant confuse the notion that in a real world, fundamentals should impact the currency. I think all the things dennis brought up about europe are true and theyve been true, outside of maybe the ukraine, and its still a 1. 34 handle, lofty by any standards. I think that all stimulus is fungible and theres enough liquidity in the world, even with the u. S. Tapering back, that the major currencies all have their issues and were going to ping pong back and forth. Id be hugely surprised if any time in the near future we see the Euro Currency under 1. 30. All right. Abigail doolittle, lately, the stock markets been zigging and zagging. Today its zigging higher, for the most part, except for the dow. You say its been ruled a lot by emotions lately. What . Well, you know, this has been a highly volatile, highly emotional market, as you said, with investors i think not having a real good sense for whats going on. If we bring it back to the corporate profit outlook which keith was talking about, on the surface it looks pretty positive. We have all these beats. But when you go below, Revenue Growth at 3 s not so great. If we compare it to what analysts were looking for in march, 7 , 5. 5 s not so great on the bottom line. Then what about capex . This was supposed to be the year of the capex recovery. We still have not seen that. And then when you throw on top of all of this the global turmoil, whats going on with the fed, the disconnect between stocks at alltime highs and the tenyear below 2. 50, i think investors dont know what to make of it. Theyve been taught by the fed to push higher. I was going to say, dennis to that point about whats signal and whats noise out there. We have gold doing well today. Weve had the soft commodities get hit. And yet, some of the metals are holding up a little bit better. What is happening in the commodities space and whats that signal for the Broader Market . First of all, kelly, lets understand, the commodities are not an asset class and they dont move together. They move absolutely in contravention one to another. The grain markets have been under unbelievable duress because the weathers been spectacular and we are growing one enormous crop. We have the biggest corn crop and one of the biggest soybean crops we have seen, so wheat prices are week. Grain prices are skyrocketing as Energy Prices are strong, but copper prices have been basically more abundant. Its interesting how different are the various Commodity Markets and too many people talk about commodities as if theyre one instrument. Theyre not. Theyre extremely divergent. Very diverse. Out of that universe, dennis, which do you think is best poised right now, and is there one of them we used to call it dr. Copper, but what is the new one to watch . I know what youre going to say, too. Here it comes. I am going to say it is not dr. Copper. Copper doesnt have a ph. D in economics. However, zinc, tin, aluminum and copper and aggregate have a ph. D in economics. And whats interesting is youre seeing the base metals, zinc, tin and aluminum, actually moving quite strongly. Coppers the laggard. So, watch the other base metals. Its probably a better instrument than watching copper alone. Its not plastics anymore. The key word from Dennis Gartman now is loom aluminum. Aluminum. Keith fitzgerald, since janet yellen made her comments about the stretched valuations in small caps, the russell 2000s done pretty well and the social media stocks have done pretty well. Would you buy them at these levels . Weve got facebook coming up tonight and theyre usually pretty volatile after the numbers come out. Thats an interesting question. Im normally very skeptical of social media. The one im watching is ali baba, because thats backed by a lot of real demand and 1. 3 billion consumers. U. S. Social media, not so much, but im very intrigued by whats happening here. I think its being driven by hope right now and expectation. Neither of those come down to earnings and i want to see the earnings. Steven, i want to go back to the backdrop of the credit boom we were discussing and how this is going to play out in the next couple of months. I think it was Credit Suisse who while being under pressure in some parts of its business lately was saying it sees structured finance, leveraged loans as a source of growth or that its going to put more investment into. Again, what is that going to mean here . Does that just mean that if youre any company out there who wants to raise money, you can . And im thinking through the m a boom were seeing in relation to this as well. Without question. Its a really easy time for companies to raise capital. Everybodys looking to put money to work. Whats important is to see what those companies are doing with that capital. You talked about m a being an important driver, and i still think were pretty early on in the cycle for m a. The other thing were going to be looking for is companies raising money to invest in their businesses to spend money on longerterm capital spending. Youre hearing from the financials that in this earnings season, theyre seeing a pickup in loan demand. Thats really important to hear in terms of what the forwardlooking outlook is. I think thats one of the reason hey, kelly . Yes, rick . Leverage loan finance thats fallen to a sixmonth low in june based on major outflows to the likes we havent seen since 2011. Sorry to interrupt. I just wanted to point that out. Is that lcd . Whos whats the source on that . Interesting. Leverageloan. Com. I could read you the clip underneath it. The assets under management of low mutual funds contracted by 2. 5 billion in june or 1. 5 to a sixmonth low of 169 billion, according to data from lipper fmi and fund filings. I wonder, would that be the retail crowd, then, steven, piling out for any reason or is this an institutional move . What do you think . Yeah, i think were seeing lower demand from both the retail crowd and from institutions. I think the mindset is shift. At the beginning of the year, everybody was saying that rates are going to move dramatically higher. Obviously, markets have gone the other way. Oh, right, right. And people are coming around to the notion that rates are probably going to move higher, but at a much more gradual pace. As a result, that whole floating rate element that you have in the loan market isnt as important. So, people are looking to reallocate that money into things like traditional high yield, but more importantly, on the margin back into equities. I guess then the signal would be that even if the retail publics disappointed, its not getting that upward float it was looking for, that the major banks are still going to be in this business. Well see, you know, if thats enough to keep the whole happy dance going. Exactly. Just buy aluminiam. Put your emphasis on a different syllable. Thanks for being on. 50 minutes to the close here. The dow continues to be negative on the day, off about 22 points this hour. The s p and nasdaq are still higher. That is an alltime high for the s p were watching, by the way. The earnings parade continues. We mentioned facebook, at t also will be front and center at the top of the hour. Well tell you the numbers to watch out for, bring you the results the second they hit the street and tell you how theyre going to affect thursdays market. Thats all coming up here this hour. And straight ahead, investors taking irobert to the wood shed after revenue miss and weak guidance today. The companys ceo explains whats happening on a first on cnbc interview and if military robots will rescue the companys fortunes. Plus, Norfolk Southerns ceo breaks down his companys earnings. The giant railroad beat analyst estimates. Find out why he is confident about this economy. The transports, the rails have just been on a tear, thats for sure. Thats coming up on the closing bell. Stay tuned. The cadillac summer collection is here. During the cadillac summers best event, lease this 2014 ats for around 299 a month and make this the summer of style. Mixed day. The dow has been down 23 points, much of that the result of boeing moving lower. Thats been the weakest component of the industrial average today. The spotlight really has been on the s p, because that is in record territory now, 1,985 and change was the previous high set back on july 3rd when we got that blowout jobs number. So, were back above that number today at 1,988 and change. Meanwhile, the nasdaq helped by the performance of apple of its Earnings Report. Dom chu joins us with some of the biggest movers today. Hey, dom. Hey, with the s p 500, guys, 12 points away from 2,000, its a big deal here. Well start with boeing moving lower, despite betterthanexpected secondquarter profits. Investors are unimpressed as revenues came in about 300 million shy of average wall street expectations. You can see there the stocks down about 2. 5 . A different story for puma pharmaceuticals, more than tripling its stock price after positive Clinical Results for one of its experimental Breast Cancer drugs. Puma up toward session highs, up by nearly 300 . A strong day for biogen iac after raising its forecast due to strong sales for its multiple closis treatment. Shares up about 11 . Then, herbalife falling after rising some 26 on tuesday as Hedge Fund Manager bill ackman failed to live up to some promises that he would deliver a death blow to herbalife as a company, and you can see there, carl icahn, who is long the stock, made a cool 234 million yesterday on his stake with herbalife shares, and so, thats a big deal. A lot of nice little pay day for carl. Well end with irobot, falling after missing analyst projections in the quarter. Down about 8 , off of its session lows. Bill, kelly, back to you guys. No wonder carl icahn hugged ackman at that conference. So, while irobot is best known for its roomba vacuum, theyre hoping to make a push into the defense space, drones. In fact, irobot drones were used for security purposes during this years world cup down in brazil. Joining us now is colin angle, ceo of irobot in a first on cnbc interview. Colin, its great to see you. Look, the market punishing your company today, maybe some concerns about the cash youre generating, the earnings, sustainability for the next couple of quarters. What can you tell us, especially about the cash piece of this story . Well, we delivered two bits of news today. One was on our home side of the business, the roomba vacuum cleaner and related robots. That was a very strong story. With fullyear guidance up 19 year over year, so that was very strong. We also talked about the defense business, where we saw some of our expectations for signing some large defense contracts pushed right some. So, while the year outlook solidifi solidified, we saw some push to the right, and i think thats why some of the investors are reacting to today. It usually takes a few days for full digesting of the story, but that d. O. D. Shift probably being at the heart of whats going on today. Cash is all very strong. We had a few adjustments that we made this year, this quarter, which oppressed margins, but we expect cash flow to come back and hit its high singledigit figures by the end of the year, as predicted. Defense. Even you admit that the defense industry, as you put it, can be lumpy. Its unbelievable. Its feast and famine. So, you get to deal with that. Im sure that makes guidance trickier. Are the margins better . Talk about how it would be different from the more traditional view weve had of irobot in the past with good old roomba. Well, you know, the defense side, which is getting a lot of attention right now, is now only about 10 of our business. So, the lumpiness that we have long had to deal with is somewhat still very material to growth rates and guidance, however, and thats what we saw a little bit of today. What it means that at the beginning of the year, what we predict is going to happen doesnt always happen. And so, moving into the secondquarter earnings call, when weve had six months behind us, able to see whats happening, we say, okay, i have sidelined every dollar to get to my predicted, the today announced 45 million bold gain were starting to build for next year, but its not the 50 million we had hoped. Colin, as you move increasingly into the defense space, is there anyone you wont sell to . You know what, our products are controlled by certain u. S. Regulations, basically nato nations were all free and clear to sell to. There are some states outside of nato where there are restrictions, but weve sold to dozens of companies at this point, and so, youre mostly selling to companies as opposed to nations . No, we are mostly selling to nations. So, u. S. Dod is a huge part of our business, but also foreign governments. Weve sold 30 robots recently to brazil to probably most notably provide Security Services at the world cup. They were used very actively every day and happily, nothing particularly bad happened down there. Talk about that for a minute. I mean, weve had our issues in the United States, the Boston Marathon bombing of a couple of years ago was an issue. How would your drone robots in that case help with that kind of openair security . So, at the Boston Marathon tragedy, we had over 20 of our robots deployed after the event looking for additional improvised explosive devices used next to the Police Officers and the s. W. A. T. Teams in doing the building searches as the chase to find the fugitive continued to unravel with the concern that explosive devices and booby traps could be deployed against our police force at any time. So, its really used as a point man, to go into situations where youre not going to throw a destructive device like a hand grenade, and you really prefer not to jump in and find out firsthand whats there waiting for you. You really would like a third option, and we have a family of robots, everything from 5 pounds, where you can throw it through a window, to 400 pounds, where it can go and lift up a person and drag it out to provide services. Wow. Thank you for joining us. Well be following along as that happens and well see if the shares rethink, colin, how theyve been trading today so far. We really appreciate your time. Thanks, colin. 40 minutes left in the trading session, the dow down 23, but were really watching the s p 500 index, which is up about 4 1 2 points right now, and its in record territory. If it closed right now, it would be a new record high for the s p. Up next, how high could Rupert Murdoch go in his bid for time warner . Some reports suggest the deal is a nonstarter until he says over 100 bucks a share. David faber has more next. And Norfolk Southerns ceo will talk to us about that railroad giants earnings. Well get his reaction to this new crude oil shipment rule thats being considered by the government and talked about just today. It could put a dent in norfolks bottom line. Talk about that coming up. Stay tuned. In india we have 400 Million People who dont have electricity and i just figured that its time i do something about it. What were doing right now, along with ibm, is to actually transfer data through a satellite from our wind farms directly onto the cloud. I think we could create a far more efficient system across the whole network where we could actually draw down different kinds of energy based on when its needed by the consumer. A smarter Energy System is made with the ibm cloud. The ibm cloud is the cloud for business. Welcome back. As we wait on some key earnings after the bell, including facebook and at t, take a look at markets. Today its green arrows across the board, except for the dow. As we mentioned, boeing weighing heavily on that index. And goldman, interestingly enough, one of the best performers on the day. Yep. Now, the saga between 21st century fox and time warner remains unresolved. A week ago, cnbc first reported time warner rejected foxs 85ashare bid. Now the stock trading just below that mark, about 84. 20 today. Our david faber has been doing some amazing reporting on this story. He joins us along with rob cox, editor at reuters breaking views. David, a lot of numbers being thrown around right now. What are you hearing right now about the give and take between the two sides . You know, its funny, bill, you said it perfectly, the give and take. Youve seen so many of these situations in the past, and thats exactly whats going to go on for quite some time. So, we are going to hear and see many different things, some of which may turn out to be true, others a voyage, where if and when they eventually get down to doing a deal may not be true. That said, as ive been reporting in recent days, certainly the fox side and its advisers are trying to send a message of discipline. What that will actually comprise, perhaps not any more cash in a revised offer. It also means, what im hearing, likely not to include voting stock, something that time warner has made a point notify its defense at this point when it talks about governance or lack thereof. So, what would a higher bid look like if there was to be one . Probably made up largely of the stock that is already 60 of the consideration they offered and was rejected, that being the a shares. But well see. Like all these things, and to your point, bill, give and take. At this point, time warner is sending very strong signals in my conversations with their advisers and the like that they have no interest in this bid, that they seem very much resolved at this point to saying this is not in the interests of our shareholders and our board is unified in its opposition. But again, time will tell. Rob, how badly does Rupert Murdoch want to get this deal done and how much is he willing to pay to get it done . Well, i think theyve done their modigliani miller. They actually realize there is a value to both companies, and no matter how you play with it, whether its equity or debt or how many hats they have or theyre pulling habits like sky at deutsche, its basically what theyve got. Theyre going to have to play with these pieces in such a way so that they dont actually sacrifice their returns, their shareholder returns. So, i think davids right, discipline does seem to be uncharacteristically the message from the murdoch camp. And i think shareholders for years now, a couple of years now, have gotten used to buybacks, dividends. I mean, a few years ago, murdoch himself said that he had foresworn big deals. Theyre kind of holding him to that. So, i get a sense that, you know, its like 95, 100, but theyve got time. They can just sit there. And people look at this, the logic of this deal, the industrial logic. They look at the sort of parameters, the competitive ones comcast, time warner cable, dish, at t i think it actually becomes kind of compelling and that will seep into the market. And thats the thing, david, you wonder if Rupert Murdoch just leaves a bit on the table and then waits for shareholders to become impatient as management sort of poopoos this whole thing. You know, the thing working you know, they dont have a dominant shareholder out there to be a voice for the shareholders. No. Does that benefit Rupert Murdoch or time warner, do you think . Well, in a way, i think if murdoch and fox are willing to hang in there and by murdoch, i mean both james and rupert, because james, of course, is very much involved, as is chase kerry in the strategy here, and perhaps even more involved in saying discipline, discipline. But to the extent that we go down that road and they stay in there and they may have to stay in there until before the annual meeting of time warner is held. I think bill, toward the end of this year, if youre sitting on a gain and youre one of the longterm only funds, perhaps you dont want to look at the possibility of that stock dropping dramatically should this fall apart, so maybe you apply some pressure there, but well see. I continue to hear somehow 100 being a price that a lot of shareholders like in their minds and pushback certainly from the fox camp that they would ever reach that, although if they could identify a lot more synergies than the billion theyve said going in, which they obviously dont know about, given they havent opened their books at time warner, perhaps you get to a different number. Or if someone would come in for a big number for cnn or something. We have to go, but to what extent is the pressure potentially coming from shareholders of 21st century fox who dont seem impressed with the amount of debt this company may ultimately have to take on to get this done . Theres only so much you can give away. Whether you raise debt and reduce value of your equity or reduce equity, even though its class s equity, no voting you can determine what the s is for. Im not really sure they are the ones imposing the discipline. So, james may actually be the one in the camp with rupert, his father, saying, look, dad, we cant do this because im not 83. The value of this stock is going to have to last me and my grandchildren for some time. Maybe hes imposing the discipline. But you know, theres just so many hats you can pull rabbits from, and i think theyve recognized that. This isnt a 3. 6 billion, 3. 5 billion deal, this isnt dow jones. Miss on this one even by 10 , youre talking 8 billion, and that ends up haunting you, perhaps, for a long time. Exactly. Great point. Thanks, guys. Thanks, guys, very much. Im sure well be talking again about all this. Good stuff. Thanks, david. Heading toward the close, 30 minutes left in the trading session, the dow coming back a little bit, down just 17 points right now. The s p comfortably in record territory at the moment. As we try to come to terms with what is happening across the u. S. Economy, Norfolk Southerns ceo is going to speak with us on a first on cnbc interview next. Well talk about their earnings and the economy. Well also get his reaction to new Transportation Safety rules on oil shipments. Its been a big business for the railroads. Well ask him how that will affect more folks bottom line. Then, in about a half hour, at t and facebook among those will be the center of the earnings story. Well have full Team Coverage. Analysts, shareholders, reporters. Its Team Coverage coming your way. Dont go anywhere. What would happen. If energy could come from anything . Or if power could go anywhere . Or if light could seek out the dark . What would happen if that happens . Anything. 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Its in record territory. And technology has done well. Theres the s p. The old high was 1,985 and change. Were at 1,988. Railroad Company Norfolk southerns stock down today, despite reporting record earnings this quarter. Were going to talk about that and more now with Norfolk Southerns ceo, wick moorman, first here on cnbc. You cant complain too much about the stock price, transportation stocks have been very strong, youve been setting alltime highs, but you wonder why the stock would sell off today, wick. First of all, welcome. Welcome back. Thanks, bill. Thanks for having me. It is not uncommon for companies to announce great earnings and their stock, for whatever, goes down that day. But as you say, the rails and the Transportation Companies have done extremely well recently. So, were not worried about today. And wick, looking forward, when we spoke with csx a little while back, they were extremely bullish on the u. S. Economy. Do you share that view . We think the economy will continue to grow. I think our view is it will grow at a reasonable pace, but not necessarily a robust pace for the next half of the year and into 2015. Were more bullish, quite frankly, on some components of our business which grew at an exceptional rate in this past quarter. As you know, our total volume was up 8 in the quarter, our revenues were up 9 , and we set records for operating income, net income, operating ratio. So, were optimistic even beyond the growth of the economy, which we think will continue to be good. A lot of that was coal replenishment, i gather. A lot of coal inventories were depleted over this bad winter we had, and because Natural Gas Prices are so high, utilities and companies are choosing coal instead, and youre among those rails that are moving that from point a to point b, right . Right, thats exactly right. We saw inventories go way down. And coal inventories are still below where they were six months ago. So, we expect that utility coal business to continue to be good, at least through the second half of the year, and then well see if we get another winter like we had. Lets hope not. Now, weve got to talk about some of the changes coming down the pike here for the railroads. You guys have been shipping a lot of oil around, and now the government wants to make it safer, wants to make it more efficient for you to do so. How much of a restructuring does this mean, potentially . How much are you going to have to invest to come up to meet some of these new regulations, if they pass . Well, let me start by saying that the Rail Industry, Norfolk Southern and all of us, along with everyone else whos transporting these products first and foremost is concerned with the safety of that transportation. As you know, the Rail Industry has a great safety record, and we all continue to invest a lot of money in infrastructure, assets, technology to be as safe as we possibly can. Weve seen the new regulations. Were doing a lot of analysis and will be over the next few weeks to see how theyll impact our operations, and well come out with our comments once weve done that analysis. But im basically optimistic that were going to come up with a set of regulations for the transportation thats material that will allow the railroads to continue to move it efficiently, effectively and safely. Because quite frankly, this is such a great resource in terms of pushing america towards Energy Independence that i think were all going to have to come to a way to do this and do it safely. Certainly, Norfolk Southern and the Rail Industry are committed, committed to doing that. I will say, mr. Moorman, that was hardly a ringing endorsement of these new regulations. That was ceo speak for this is on the negotiating table, were going to be doing negotiations. Is it possible they will be too onerous in terms of the amount youll have to spend for upgrading your equipment, for the speed limit theyre going to impose on you guys that might put you on a slower rail schedule . I mean, all these things that are going to go into consideration here, just first, is this an appropriate regulation that theyre proposing right now . At our very first blush, we think that when you look and of course, as you know, there were a menu of options that there are options in this that may require some investment from us but will allow us to continue to ship this material without excessive burdens. And i will say, the other important point here in terms of all of this analysis is not just how it affects the Rail Industry. What it really affects is all of the other consumers and communities that rely on the products that we ship, from u. P. S. Packages to food to automotives to amtrak passengers. And its those kinds of Network Effects that we really have to sort out and arent quite sure of yet. Yeah, got it. We could all be paying for it, in other words. Wick moorman of Norfolk Southern, always good to see you. Thank you for your time. We appreciate it. Thanks, bill. Heading towards the close, 20 minutes left in the trading day, down 16 points, well off lows. The dow was down 50someodd points at the low of the session, so were off those lows. But the s ps the focus today, as we are setting an alltime high there, looks like. As the earnings parade continues, Raymond James is also reporting next hour, and its ceo will be here. Well get his take on the numbers, find out his view on how strong this economy really is. Up next, as at t and facebook gear up to post their earnings after the bell, dominic chu will tell us the numbers to watch, so stay tuned for that. R0 turbocharged reward card with a new volkswagen turbo. Why are we so obsessed with turbo . 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Thats why we give you the edge, with innovative charting and trading features, plus powerful mobile apps so youre always connected, wherever you are. Because at scottrade, our passion is to power yours. A very special guest with the New York Stock Exchange today. Youve probably by now recognized ryan pitt, former u. S. Army Staff Sergeant, who on monday received the medal of honor from president obama, and then on tuesday, he was inducted into the army of the pentagons hall of heroes. Hell be coming up here in a few minutes. Hes ringing the closing bell today as well. Were going to speak with him, as bill said, in a couple minutes. Looking forward to that very much. One of the heroes that comes to ring the bell at the New York Stock Exchange. Dominic chu at headquarters, some of the biggest names in america posting after the close and he has the numbers to watch. Hi, kelly, bill. A busy close after the bell today. Earnings season heads into full swing. The big four after the bell today. Youve got facebook, at t, Gilead Sciences and qualcomm. Theyre on the top of the board here. Analysts expect facebook to earn 32 cents a sale. The key question is how well theyre monetizing its mobile business, advertising. Also, look at at t, looking to maybe earn 63 cents a share, according to analysts, on 33 billion in sales. Its going to give us the latest picture on the state of the telecom industry. Its the second Biggest Telecom in the country. Gilead sciences is scheduled to make 1. 79 in earnings per share on sales of 5. 9 billion. Analysts think that 3 billion of that could come from that blockbuster hepatitisc drug, the one that costs 87,000 for a 12week treatment. And qualcomm, the other big one looking to earn about 1. 22 on sales about 6. 5 billion. Its one of the Top Producers of smartphone processors. Now, thats going to be a bellwether for some of that wireless side of the business. Also after the bell today, trip adviser, tractor supply, Cheesecake Factory all reporting. Well have all of those in the next hour of closing bell, so stay tuned. Its going to be a busy, busy earnings close today, guys. Back to you. Our favorite kind of day. Thank you, dom. 15 minutes until the close. Markets still seeing the dow potentially finishing to the negative, off about 20 points, but again, the s p here is eyeing a new record close and the nasdaq doing okay, buoyed by apple, up about 18 points. When we come back, were really looking forward to talking to former Staff Sergeant ryan pitts about what a great week hes had, the newest recipient of the medal of honor will join us as we gets ready to ring the closing bell here at the New York Stock Exchange. Thats coming up after this. Collection is here. Sur during the cadillac summers best event, lease this 2014 ats for around 299 a month and make this the summer of style. With all the opinions about stocks out there, how do you know which ones to follow . The equity summary score consolidates the ratings of up to 10 independent Research Providers into a single score thats weighted based on how accurate theyve been in the past. Im Howard Spielberg of Fidelity Investments. The equity summary score is one more innovative reason serious investors are choosing fidelity. Call or click to open your fidelity account today. Welcome back. Ten minutes to go here. As you can see, at 1,988, the s p 500 currently is above its prior closing high of 1,985 that was recorded on july 3rd after the strongerthanexpected june payroll report. Weve been struggling to get back to that level all month. Today it looks like we could be going out with new highs here with ten minutes to go. Humility, honor and heroism. Some days, those qualities seem as if they are in pretty short supply. But Staff Sergeant ryan pitts represents those traits and a whole lot more. He was the sole survivor of a fierce attack, now regarded as one of the bloodiest battles in the war in afghanistan. And on monday, president obama made Sergeant Pitts the ninth living recipient of the medal of honor for actions in iraq and afghanistan. Today hes set to ring the New York Stock Exchange closing bell in just a few moments, and we are honored to have former u. S. Army Staff Sergeant and medal of honor recipient ryan pitts now on the closing bell here with us. Welcome. Congratulations. Thank you. I said to you during the break, youve had quite the week, havent you . Its been busy. Has it sunk in yet . No. I think it will be a couple of years before that happens. And this is for events that happened during the summer of 2008, so about six years ago now, in afghanistan, a battle that took out nine of your fellow soldiers. How freshly do those events still live with you day by day . Many of them are just as fresh as if they happened yesterday. I think about those guys, what we did every day. Does that make it difficult now that youre back in the workplace, we understand working up in new jersey where youre from, with oracle, doing business software, does that help our Heroes Program ease the transition back into, away from the battlefield . Absolutely. I mean, just knowing that the countrys behind us and, you know, my peers at work, the brothers i served with are behind us certainly helps, and theres a lot of programs to help us in other ways with our skills and things of that nature. How was the transition for you to come back . I mean, youve made a lot of life changes since youve been back. You left service honorably in 2009. Since then, youve been married, youve had a child, which we congratulate you on. Hes 1 year old right now. And you work for oracle. Was there a Transition Program for you to go through there at oracle to get into the workforce again . There was a Transition Program at walter reed when i separated from the military, and then, you know, i dont think theres ever going to be a point where im transitioned. Ill spend my entire life transitioning. I went into oracle through a friend, so they didnt know too much about me being a veteran when i joined. Mark hurd certainly knows about it now. He put out a press release honoring you as you received that medal of honor from the president. How did that go on monday . It was surreal. Surreal, right . Yeah, absolutely. And you know, just a whirlwind, but the president made us feel very welcome and at ease with everything. You mentioned walter reed and you said this will be a lifelong struggle. To what extent has your experience with the va been supportive of that, or has it reflected some of the reporting, which is that in many cases, Veterans Affairs hasnt been up to the task of caring for our veterans . My experience has been overwhelmingly positive. Just going to the Va Medical Center in new hampshire. Thats great to hear. Well, youve got another great experience coming your way. Youre going to head up to the balcony to ring the closing bell. It goes without saying that we thank you for your service and congratulations on this distinction and honor. Its well deserved. Thank you. It was my honor to serve. Deeply appreciate it. He will be closing the day on wall street coming up here in just a few minutes. And it looks like it will be a positive one. It does, at least right now. The dows negative, but the s ps in record territory. Well cap it off on the closing countdown. Facebook and at t after the bell report numbers and we will have that, plus instant reaction from analysts and shareholders standing by. Keep it right here. Seven minutes to go. Youre watching cnbc, first in business worldwide. 400 Million People who dont have electricity and i just figured that its time i do something about it. 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Its so close to the options floor, youll bust your brainbox. All on thinkorswim, from td ameritrade. Okay, kelly and the gang, next hour they have their hands full. Heres what is coming out with earnings in the next hour here. Of course, facebook will be something theyll be watching for carefully. The earnings estimate is for 32cent profit on 2. 8 billion in revenue. At ts another one theyll be watching very carefully. Earnings of 63 cents on 33. 25 billion. Gilead sciences looking for a profit of 1. 79 on 5. 8 billion. Qualcomm, earnings estimate of 1. 22 on 6. 5 billion revenue. And tripadviseor, 61cent profit is estimated. Bob pisani along with mark martiak of premier wealth management. Earnings supposed to be the lifeblood of the market. Is that how you see it and are you inclined to want to invest right now still . I am inclined. I am confident that the market will continue to climb higher, bill. And as multiples expand, investors will increasingly lean on corporate earnings to propel the markets higher. Why do you think multiples are going to expand . This is a very controversial point in the market right now, whether the market deserves a higher multiple. I believe the market deserves a higher multiple. When i look at the meaning that the price will go above what the premiums are. When i look at technicals, fundamentals and valuations, i still think corporate earnings are going higher because of the u. S. Economy, bob. The u. S. Economy continues to be at an abovetrend pace, even though we had a very bad q1 gdp number, minus 2. 9 . My forecast and what i see and what im telling my clients is that annualized, were going to be at 3. 5 annually. And im looking at a price target of the s p 500 of 2,050 by year end. Profit margins go up, for example. Are you anticipating that . Margins are under a little bit of pressure right now. They are, i agree. A lot of charges of earnings engineering as Companies Buy back shares, rather than piling the money back into Capital Expenditures of some kind. I agree. Discounting the share buybacks i still feel that with valuations, technicals, fundamentals, i think everything looks good. This market continues to go higher, in my opinion. By the way, you see now the best performing sector in the Standard Poors 500 index is the Information Technologies sector. That is now annunumero uno. Your ciscos, ibms have been outperforming. Tomorrow well get the builders. D. R. Horton pulte, were expecting a pushup in the Second Quarter, but we havent heard a lot from the builders yet. And were going to get the auto sales. Ford and gm are going to be reporting tomorrow. My favorite Big International company, caterpillar, theres a great example of the global construction, Global Demand for businesses overall, because almost 60 of their businesses is overseas at this point. Favorite sector right now . I like technology, i like biotech. Materials has been doing well. And believe it or not, in this last quarter, Consumer Services has been doing really well. Youre investing for growth. Youre not investing defensively. Im invest aftering for total return. Im always focused on growth and income for my clients. Metals have been up, aluminums been strong, all of the steel stocks have been strong recently. Thank you, gentlemen. Good to see you. And as you can see, Staff Sergeant ryan pitts, the latest medal of honor recipient ringing the closing bell as we close out a day when the s p 500 index is at a new record high. But stay tuned. A lot of earnings coming your way on the second hour of the closing bell with kelly evans. Ill see you tomorrow. Welcome to the closing bell, everybody. Theres that graphic. You know what that means, the s p 500 today going out at a new record high, 1,987 and change. That, by the way, is not for the market, it is for ryan pitts who we just spoke to, medal of honor recipient and duly so. Up about 3 points for the s p 500, down 25 for the dow, weighed down by boeing. Im kelly evans. Joining me on the panel is herb greenberg, nick lag carlson from Business Insider, Todd Schoenberger from jay striker Asset Management. And to wrap up the days action on the markets, fast money trader jon najarian. Were all waiting for key Earnings Reports due out in a couple minutes time. Dr. J. , what is the most important thing to watch for here after the close . Well, for me, its going to be facebook, because number one, because im in that stock. So, kelly, thats important to me. But as far as the overall market, i think the fact that facebook could actually be monetizing in a bigger way, mobile in particular, i think thats where the real juice is coming from here. Stocks just slightly below an alltime high. There were big uptime im sorry, call speculation in this name. If they can blow it out, thats going to carry an awful lot of social media names, of course, like twitter and all the rest of them that janet yellen talked about. It will carry them all higher. Cant wait to see what the response would be in case, but look, at least these are the big names in this space that are generating, todd some earnings, have an actual business behind them, but lets talk about the Broader Markets. Nasdaq looking pretty strong today, dow transports at a high, Dow Jones Industrial average lagging a little bit, but the s p at new record highs. Its going to continue. I mean, what is going to be the catalyst to actually get the bears out of hibernation . Theres nothing there. Minus 2. 9 gdp print in the First Quarter, polar vortex, geopolitical issues, and yet, the stock market continues to rally and continues to move higher. Good or bad . In other words, is that supported by fundamentals, strong longterm you can look at fundamentals. Hold on, herb. You can look at fundamentals. Also look at the fact that you have less participation. Only 52 of americans right now invested in this market. You still have a lot of cash thats on the sidelines, but that Retail Investors hasnt quite jumped in yet. So raising an eyebrow, herb. Because i think what were seeing makes the market that much more dangerous and vulnerable to that. Whatever its going to be that will bring it down and scare the living daylights out of people. What youre seeing now is youre seeing companies, even like an Intuitive Surgical up today. Big gains on just sort of, you know, things are Getting Better at our company. Come on. So, i think you just have to Pay Attention to the fact that its quality earnings are going to matter at some point. Theyre higher, but you know, its not look, weve already had a new run the bar was already set low because of the firstquarter problems that we had, and look, these numbers are blockbuster. 72 of s p 500 companies who are reporting over the next three weeks are in the heat of it and we havent been disappointed, and you saw it in the financials as well. A little bit of a disappointment maybe in at t shares which looked to be under pressure in after hours. Well talk about the details of that report in a moment. But todd, its clear that its not all good news. Its not. Its not all good news. Heres the only thing i can see actually coming down the line, herb, that can actually get the bears rolling here, and its going to be something geopolitical. Look, heres the thing, we have not as a country been involved anything with any type of hostile event, violent. Think about it, over the last few years weve been on the sidelines. But here it is, on the cusp of something big. If we jump in, thats going to hurt sentiment for wall street. Hold on for a second before we go down that road. Lets talk about at t. Secondquarter earnings are out and Morgan Brennan digging through the numbers. Were still going through this report, but right now it looks like a top line and bottom line miss. Were looking at adjusted earnings of 62 cents, and that is versus the 63 cents that the street was looking for and on revenues of 32. 58 billion. Thats versus what the street was looking for, 33. 22 billion. So, overall, a miss. Also looking at the churn rate, though, i will tell you this, were looking at post paid churn rate of 0. 86 , and the street had been looking for post paid of 0. 94 . Theres some other headlines here that look interesting. Were going to dig in and bring you those in a bit. Kelly, back to you. Morgan, thank you. And before we move on, we want to now hit qualcomms earnings, which are hitting the tape here. I believe dominic chu is going to join im sorry, josh lipton is going to join us now with those numbers. Josh. Qualcomm just reporting. 1. 31 on 6. 8 billion. Thats a beat. Street was looking for 1. 22 on 6. 52 billion, so a beat on the bottom and top. Looking through the release, msn chip shipments, that clocked in at 225 million. That, according to estimates i was looking at, better than expected. But the guidance here, kelly, looks to be a little weak. Q4, theyre guiding for eps of 1. 20 to 1. 35. The street was looking for more like 1. 39. That Conference Calls going to start at 5 45 p. M. Eastern. Expect a lot of questions about china, seen as a big opportunity for qualcomm, but also some questions. Analysts point out, listen, are those chinese consumers . Are they buying highend or lowend devices . That would have a big impact on qualcomms asps and royalties. Kelly, back to you. Josh, thank you. Dr. J. , what do you think about these qualcomm numbers . You were with us when sandisk reported. Its not apples to apples, but were trying get a sense of the strength in the tech sector. Yeah, well, the revenue number looked light. And as josh said, theres no doubt that the guidance is weak. The guidance is weak in the area of about 10 , kelly, from what street was looking for as far as the forward guidance. So, that doesnt mean theyll hit the stock 10 , but i wouldnt be surprised to see them push it under 80 pretty quickly here. Its already down 1. 30 in the post, and it looks like its going to be challenging 80 right now. Thank you, dr. J. Weve got now a look at facebook. Shares look to be moving to the down side to the tune of minus 2 after hours. Julia boorstin joins us now. Julia in just a moment, i should say, shes going to have the numbers for us. Nicholas carlson, before we hit that, just a thought on qualcomm and what dr. J. Was alluding to with a little miss there. Yeah, well, its theyre in the business of making the chips right now, and its like they have to be just sort of recharging and sort of, theyre about the ecosystem as well. Yeah, and thats one to watch as we start to pivot towards some of these newer models. Julia, what can you tell us . Julia boorstin joining us with facebook earnings. Julia . Reporter thats right, facebook earnings per share, big beat on the up side, kelly, coming in at 42 cents, excluding items, compared to estimates of 32 cents. That is up 19 cents from the yearago quarter. Revenue also higher than expected at 2. 9 billion in revenue, versus expectations of 2. 81 billion from wall street analysts. Looking at key user numbers, daily active users were 829 million. Thats just a hair lighter than wall street had expected. Mobile daily active users 654 million, and then looking at a mobile monthly, 1. 07 billion. That means that over a billion people used facebook on a monthly basis. A key number that investors are going to be watching is mobile advertising. It represented 62 of all advertising revenue. Thats up from 59 in this most recent quarter and its also higher than expected. Kelly, continuing to dig through this report and ill be back to you with more. Julia, thanks very much. Facebook shares now off about 1 . Lets bring in martin pike and Colleen Taylor from tech crunch with their reaction to these earnings. Martin, first to you. What do you say about the quarter . You know, i think its a very solid quarter. The stocks obviously had a great run recently, so im not surprised its trading off a little bit here, but revenue close to 60 growth, advertising 58 , 60 it looks like in that range, so very solid. As you pointed out, mobile is growing. Whats happening here is advertisers are getting a good yield and a good return on investment with mobile apps. So theyre working from the advertisers side. Colleen, what about you . I think the reason we might be seeing some early downgrades in the stock in after hours right now is because those mobile users, the mobile monthly active user growth hasnt been maybe as strong as a lot of people had been wanting it to be. I mean, the overall numbers here are fantastic and no big surprise from facebook, they beat analyst expectations over the past four quarters. So, once again, blowing out of the water overall. But its not just about the numbers, its about the specific where those numbers are coming from. And right now, its really all about mobile. We need to see a lot of growth on the mobile side, both in mobile users and mobile advertising dollars, and its not quite clear yet that facebook really surpassed expectations in that small thing. So, i think that may be why were seeing a little hesitancy about the stock. Do you agree, nicholas . I think when you look at facebook right now with its core product, the mobile app, its in optimization mode. You know, theyre trying to get more out of video, more out of ads. What we havent seen is what they can do with instagram or whats app. They split it off and that shot it right up the charts. Todd, what do you think . Shares are now down little more than 1 after hours. Im shocked by it, kelly. I dont understand it. Im what, a year and a quarter ago, their mobile ads were, what, maybe 0 , i mean, compared to total earnings. Now youre looking at companies actually made 1 billion in revenue increase year over year. What am i missing here . Thats a 50 increase. If you own a hyper growth company, this is it but its hyper priced in. If youre not buying it now, youre never going to buy it. Why wouldnt you buy it now . 62 of revenue from mobile apps. They have 1 billion people around the globe that use the app on their mobile device. They have 1. 2 billion user base dr. J. . I agree. I mean, it will also be key, kelly, what we hear from Conference Call and so forth. But overall, these numbers, top line beat, bottom line beat. I mean, all the engagement, everything you wanted to see is there. So, if people want to what about colleens point . I missed that. What about the mobile user growth . Doesnt it all come back to that metric . I dont think it all comes back to that. Certainly mobile is important for facebook and twitter, but obviously, an awful lot of folks use facebook on desktop still. Whether theyre dinosaurs or not, kelly, thats the way a lot of people still use it. So, if im not seeing mobile growth with facebook, as long as the numbers hold up and the revenue numbers certainly did more problem for mobile than for facebook potentially. Yeah. What do you think, herb . I think the best part of this whole thing is Mark Zuckerbergs comment. In the very second paragraph of the press release, we had a good Second Quarter. That will go down as one of the greats, because there was not really hype there. Just telling it the way it is. Those of us using facebook, we know were now forced to deal with the ads, but a the one thing i was looking at twitter based on this, because in the end, user growth will be what it is. People really want to see mobile ad growth continuing to move forward, but looking at twitter, twitters hardly budging on this one. For whatever reason, its actually not hitting them. We have to go. We have one more earnings to hit the tape. Dr. J. , before we do let you go, a name that started moving after hours here was puma yesterday, and you said theres been fishy action in options. Anything else you want to flag for us while we have you . Another one would be ariad, aria. That stock popped like that, kelly, right after we finished the halftime report. It was trading 15 calls to every put. Wow. Much heavier than normal volume, betting on the up side. They make leukemia treatment that the european medicines, which is the equivalent of our fda overseas, has been exploring as far as making it more available overseas. If that happens and if they bet on things, or at least if they trade on things the way our legislative bodies tend to, then this is a pretty good tell. All right. Were going to leave it there fow for now. Dr. J. , thank you for joining us. Gilead is out with Second Quarter earnings and meg tirrell has those earnings for us. A big beat for gilead, seeing earnings per share 2. 36 for the Second Quarter versus analyst estimates of 1. 79 a share. Also a big beat on sales, 6. 53 billion versus analyst estimates of 5. 86 billion. But of course, the important number here is gileads sales of its help tight c drug coming in at 3. 8 billion in the Second Quarter versus estimates of about 2. 6 billion to 2. 9 billion. The whisper numbers up to 3. 5 billion, so it just hit that whisper number with sovaldi. They say theyve treated 80,000 patients since the launch of sovaldi. Back to you. Those shares moving higher and travel website tripadvisor also hitting the tape. Seema mody has the Earnings Reports. Kelly, tripadvisor reporting Second Quarter earnings. The stock is getting hit after hours and heres why, earnings missing street expectations. Secondquarter earnings of 55 cents a share versus an analyst estimate of 61 cents a share. Revenue slightly higher than what the street was expecting at 323 million. The analyst estimate there 322 million. Two other metrics display ad revenue, 37 million for the Second Quarter. That did come in higher than analyst expectations. And clickbased revenue of 235 million, also higher than the street expectations. But again, given that it missed its bottom line estimate, the stock getting hit after hours. Kelly . It certainly is. Seema, thank you. Thanks, everybody. Be sure to stick around and catch dr. J. Coming up with the fast money crew at 5 00 p. M. Today. Theyre talking to the ceo of stratasys, david reis. Some described them as doing one of these tax inversions, so dont miss a moment of that. Much more on facebook earnings still to come. Well hear from a pair of shareholders on whether they are buying or selling their shares based on these reports. Then, Steve Liesman interviewing president obama exclusively here tomorrow on everything from taxes and economic patriotism to the minimum wage. Steve will be here with a preview, plus, find out what the panel would like to ask the president. Were back in a moment. Dont just visit san francisco. water dripping and pipes clanging visit tripadvisor san francisco. soothing sound of a shower with millions of reviews, tripadvisor makes any destination better. Welcome back. A lots just happened. Lets send it out to dominic chu for an earnings alert. We have angies list, which is down about 12. 5 in the afterhours trade and about 85,000 shares worth of Trading Volume in the after hours. The companys actually reporting a loss per share of 31 cents. Again, a 31centpershare loss versus analyst estimate of 24centpershare loss. Revenue is light, 79 million with the analyst estimate 80 million. Also, guidance for the Third Quarter was light as well. The company sees thirdquarter revenues of 80. 5 million to 82. 5 million. Wall streets looking for 87 million. The company saying in the statement accompanying the Earnings Release that they increased marketing spend during a seasonally strong period, also that they expect significant improvement in margins in the second half of the year and see continued compelling opportunities for growth. So, angies list was a miss on the bottom line, a miss on the top line, a miss in the forecast. They do think theres optimism in the second half, but still, you can see the investor reaction. Shares are down about 12. 5 in a lighter, relative aftermarket trade. Dom, thank you very much. Well pick one facebook in just a second, but herb greenberg, compelling opportunities for growth here at angies list . An incredibly great service, but guys like me are doing service around the house, trying to find somebody to use, i can still go to yelp for free. If you know how to use it and how to track things, i dont have to pay for it. So, i have yet to pay for it, i have yet to go on a trial. Its sad because its a good idea and its a good concept. Yeah, difficult second half ahead for them. Were continuing our coverage of facebook earnings now. The stock, lets take a look. It began by trading lower to the tune of about 2 . Now its climbed back into positive territory. Joining us for more is mark hauten and brian evans. Welcome to you both. Mark, facebook investors clearly trying to make heads and tails of the release. What do you say about these results . Well, i think theyre absolutely exceptional, to be frank. The financials are really strong across the board. For me, what was really important was they had a beat on advertising, because the market had been slowly edging up numbers because various ad networks had been suggesting that numbers were going to be strong and pricing good, and thats indeed what weve seen, about 100 million beat. Thats really what was needed to drive the shares higher. If you want to pick a hole in anything, it would be some of the user numbers were slightly lower than market expectations, but its really picking very, very small holes in what are an extremely solid set of numbers. Brian, same question to you, and why is it that the market is not as focused on those slightly lighter user growth metrics, which i feel like a year or two back they would have been much more heavily punished for . Well, this really isnt a social media company, its a communications and advertising company. So, really, what theyre about is making a profit. Now, when i was on your show back in march talking about the valuation at facebook, i said it was about 20 overvalued, and it proceeded to drop about 20 . Now i was coming in today to talk about how its 25 undervalued based upon the present value future expected profits. Ive got to go back and redo my numbers because its even more undervalued than that based upon this Earnings Report. Wow. Can you just give a rough sense now what you think were talking, then . Well, i was going to say it was worth 93 bucks a share, but i would suspect its going to go above 100, because i believe that earnings do matter. I have a whole fund based upon that at advisorshares. Com called the medrona funds. All it does is buys growth at a reasonable price. And here im looking at a stock trading at a peg ratio of fiveyear forward ratio of 25 under the average of the market. Okay. Yet, one of the interesting factors of this stock is that it is increasing its percentage of earnings before interest and taxes as its increasing its growth. So, thats something you dont usually see in a large company. And question for the panel here, do you guys think facebook beats the splitadjusted apple to the 100 mark here . Yeah. Do you . I mean listen its much further away, obviously. Right. Were obviously premature with this discussion. However, when i look at this report card, herb, youre laughing. If you had matching pants on, youd give a standing ovation. This is a great story im telling you, looking at the numbers, monthly mobile. I mean, youre looking at 1. 07 billion on the monthly mobile users. I mean, thats a number. I know were slightly below, you brought it up. However, thats a number we want to focus on, because theres mobile tv ads. Thats going to be the thing that really propels this company. We have more on facebook from Julia Boorstin, just finished speaking to coo Sheryl Sandberg. Julia . Thats right, kelly. Sheryl sandberg telling me that on the earnings call, shes going to announce that the company now has 1. 5 million active advertisers, so thats a landmark number there. She noted that the companys really seeing growth across all geographies, across both existing advertisers and new advertisers, and mobile ads growth is being driven from everything from Small Businesses to large businesses. She said even those app install ads, which are a portion of the mobile ads, are being adopted by large advertisers like a target as well as a small advertisers. Now, she gave me this quote s saying personalized upscale advertisement is working. The platform is starting to combine with people realizing facebook is a creative, unique canvas for storytelling. Im sure well hear about measurement. She said they made investment in measurement and focusing those ads directly at who people are. Now, kelly, one other key point is i asked her about instagram, because theyve been slowly rolling out instagram ads. She says its a great opportunity. Were seeing a lot of demand and great results, but its still very early days. So theyre not going to break out those numbers, it seems, just yet. Kelly . Julia, thank you. Shares appear to be moving around on that, nicholas, now up to the tune of 2 . Whats your reaction to either what Sheryl Sandberg said or further detail on the First Quarter . If im down and patient on instagram as long as possible, seems like they have a lot of runway with other businesses. Then the number id be curious to see from facebook is just a breakdown of the mobile app install ads, which are Large Companies which are small companies, because a little bit, thats frothy, because youre looking at startups buying distribution through facebook, and thats venture money. So, its, you know, thats not real businesses buying advertising in marketing. Thats people just saying, look, oh, we just got 25 million, we need ads. Mark . I think that may be true at the margin, but what weve got here is a company with a user network that is multiples the size of anybody else, and the power of a Network Increases exponentially with the number of users. This network is well more than five times worth twitters network with a fifth the number of users. Wow. So im guessing you think it will beat apple to the 100 mark. Our former price target was 87. That will clearly go up since todays numbers. These are exceptional numbers. They really are. Herb, last word . These guys, regarding where it goes, they would know better than i, but i still look at it in the context of the entire market. Facebook, i look at it compared with twitter. I use them both very differently. I am sucked in by those ads. I dont like them, but i am sucked in by them because it is so effective. I use my facebook on my mobile app a lot. Doug kass is saying 40plus. Those 40 and over dont quite understand facebook. I think he may have something there. But i think, look, well see. Ive learned never to underestimate these Tech Companies or these type of companies and what theyll do, because weve seen enough people hurt by that. Thats right. And those ads, those video ads . Keep in mind, theyre probably going to go after the worldwide tv advertising market, which is worth 200 billion but the one point i want to make here, given the mood of this market, any disappointment in facebook, this, not next quarter, anything theyll say, be careful, because this is an unforgiving market, each if its a blip in history. Key is Mark Zuckerbergs aggression. Hell use this to buy the next app. Raymond james set to report and paul reilly is here to break down the numbers. Up next, Steve Liesman is here with a preview of his exclusive interview with president obama tomorrow. Find out whats on the president s mind and steves mind ahead of the big sitdown. Well be right back. Just take a closer look. It works how you want to work. With a Fidelity Investment professional. Or managing your investments on your own. Helping you find new ways to plan for retirement. And save on taxes where you can. So you can invest in the life that you want today. Tap into the full power of your fidelity greenline. Call or come in today for a free oneonone review. Okay, if you thought todays afterhours action was busy, wait until you hear whats on tap for tomorrow. Weve got amazon, starbucks, visa, pandora, just some of the big names set to report after the bell thursday, and thats the undercard for the main event. An exclusive interview with president obama on this network. Steve liesman is in los angeles, where hell be tackling all things economic with president obama, and he joins us now with a preview. Dont give away the questions just yet, steve. No, i dont think i have to, kelly, but i think you know as well as i do, this is a particular particularly poignant moment when it comes to economics in president obamas presidency, in the sense that this tax inversion issue has really exploded. And the question i think for business for our viewers is has this become a wedge for changing the tax code, does this become a way for there to be reform that businesses have been waiting for . Very interesting interview with the head of one of the Drug Companies moving overseas and her father, who is a senator, saying that what the daughter did should be deemed illegal. So, this is a real issue thats out there, and well be anxious for the president to weigh in on that as well as whats going on overseas and the impact on investment and business in the United States being very important as well as u. S. Foreign policy. And then theres the whole obama agenda that seems to be stalled right now when it comes to the minimum wage and a whole host of other issues, Building Infrastructure and how the president might make any progress on those. So, i dont have to give you the questions, kelly, but a smart person like you would take a step back and know exactly what theyre going to be. I dont know. Youre unpredictable, steve. But listen, im just wondering, you know, the president often has a motive, an agenda in mind when he does these interviews. What do you think it is right now . Well, it may be to weigh in on this tax inversion issue. Jack lew, by the way, at delivering alpha, a cnbc event, brought it up to the administrations level, making the first comments there, and my guess is the president wants weigh in on that, and i think he wants to see if theres a way to advance that agenda that i just spoke of, the economic agenda, which is so stalled. I dont even know i saw that the number of Days Congress is going to be in session before the election is really minimal. So, theres not a whole lot of time to make anything happen if they do, and of course, after that, the question is whether or not a window opens up for the president to advance his agenda there. So, i think thats a part of it. I also think, kelly, as you know, he hasnt really had any time to focus on the domestic Economic Issues in part because of how much events overseas have really taken his time. To that point, steve, i wonder how much the domestic audience wants to hear about it. I mean, theres a lot happening around the world right now. Its not as if these arent major, terrifying, you know, troubling developments. And is this the time to be sort of doubling down on domestic Economic Policy . Its an interesting question. I think that when it comes to our viewers more than when it comes to average americans, they sure would want to hear about the domestic economy. And certainly, the president , despite whats going on overseas, still has to steward the economy. So, i think talking about it makes a whole lot of sense for him. Yeah, fair point. All right, know its still difficult out there for a lot of folks. Steve, thank you very much. Steves interviews coming up tomorrow, live at 5 15 p. M. Its unusual for it to be live. 5 15 p. M. Eastern, exclusively on cnbc. Dont miss a moment of that. Raymond james earnings are also out this hour. Next, ceo paul reilly giving us the numbers and telling us whether Retail Investors are ready to get off the sidelines as the market hovers around record highs. And shares of Hawaiian Airlines Parent Company soaring after earnings today more than doubled on Strong Demand and stable fuel prices. But does geopolitical turmoil threaten the travel industry . The carriers ceo joins us exclusively coming up on the closing bell. Youre driving along, having a perfectly nice day, when out of nowhere a pickup truck slams into your brand new car. One second it wasnt there and the next second. Boom youve had your first accident. Now you have to make your first claim. So you talk to your Insurance Company and. Boom youre blindsided for a second time. They wont give you enough money to replace your brand new car. Dont those people know youre already shaken up . Liberty mutuals new car replacement will pay for the entire value of your car plus depreciation. Call and for drivers with accident forgiveness, Liberty Mutual wont raise your rates due to your first accident. Switch to Liberty Mutual insurance and you could save up to 423 dollars. Call Liberty Mutual for a free quote today at see Car Insurance in a whole new light. Liberty mutual insurance. Welcome back. The earnings keep on coming this afternoon. Now dominic chu is taking a look at skechers results for us. Skechers up about 7. 5 , a strong, Strong Quarter for them. They beat on the bottom and the top line. Handy beats on both sides. In terms of the overall forecast for the company, the company did say in their release that they feel comfortable with the analysts current consensus estimates for the Third Quarter, even though were up against tough comparable comparisons. Robert greenberg saying through the release that they feel as though that theyre positioned well for the overall growth picture in the second half of the year. Given the Broad Product acceptance we achieved through the first half of 2014, we believe the momentum will continue through the second half of 2014. So, some more bullish comments. They also did say that their earnings in terms of the First Quarter resulted in a strong beat. Also, that was driven by a 37 sales increase over the same period last year. The highest quarterly revenues in the companys 22year history. So, again, skechers shares up on that bit of news. 130,000 shares have traded, up 7. 5 , you can see there. Back to you. Dom, thank you. Financial Services Firm Raymond James out with earnings a short while ago and reporting record revenue. Joining us in a cnbc exclusive from nashville, tennessee, the companys ceo, paul reilly. Paul, its good to see you. Good to be back on, kelly. So, which part of your business was most profitable in the Second Quarter and where are the headwinds right now . Well, the business is strong, and here i am in nashville, the few thousand of our Raymond James family members, including 700 kids. So, we really are a family company. But the private client group set records in revenue, net income, 49 additional advisors this quarter alone, along with our Asset Management group, which continues to grow, both on, you know, organic growth in the market. So, that group has performed very, very well, as well as the bank. And is the return on those divisions, return on equity, return on assets, however you want to look at it, going to be as strong Going Forward as, say, some of the other parts of the business, Investment Banking during the last cycle here, as everybody chases this area across the industry . You know, weve been such a longterm growthoriented firm. Were proud that we had essentially 12 return on equity, 11. 99 for the year on 20 capital. Were a heavily capitalized company and have strong earnings and its driven off the private client group, which has been growing at this pace for over 50 years. So, its been a longterm investment. We havent been chasing it lately and feel very, very good about it. The headwinds have come more in the Capital Markets area, the fixed income business is very tough because of lack of volatility and low interest rates, and same with trading and the equity Capital Markets. But both two very good franchises, just little headwinds. Thats the question, are these franchises youre going to keep and continue to invest and grow long term . Absolutely. Were looking at longterm growth. In fact, in many of our businesses, we actually recruit in downturns. Its part of the advantage of being heavily capitalized and very liquid is we look at downturns as opportunities to grow businesses we want to be in long term. So, were still growing. We like organic growth, recruiting people we want, but have been pretty open about looking at companies that fit our culture and would add to the people we have, both either geographically or, you know, expanding our businesses. Im glad you raised that point, because im thinking of cit group, which is buying one west. Its going to become one of the biggest banks in the country. And you know, its looking at a cheaper funding source, of course, with getting a bunch of depositors and just positioning for what could be a wave of consolidation across the Banking Industry here. It sounds like what youre saying is that that is coming and youre going to be a part of it. Well, but were not aggressive. We did do a 1 billion acquisition, Morgan Keegan a couple of years ago, but the primary reason was it fit our culture. Their advisers were very much like ours. They had a great fixed income business that complimentemented in public finance. So, if its not a cultural fit. We hit 480 billion in client assets this quarter. Were not going to be the biggest, but we think were big enough to compete and the culture is the number one driver right now. Well, you mentioned some of these targets. What about overseas targets . Tax inversions are all the talk, and im sure whether its, you know, the m a wave were looking at and some of the people at your firm talking to clients possibly about this, its going to be a huge issue. We may see real pushback out of washington here. That may be. Weve been open about looking at acquisitions on the continent and m a for equity Capital Markets business and Asset Management. So, but there will be more niche acquisitions, and i dont think were going to invert from st. Petersburg, florida to overseas any time that i could ever see. Well, Stranger Things have happened. Thats true. Well leave it there for now. Thank you so much for being with us. Paul reilly from nashville, tennessee, with Raymond James earnings today. Thank you, kelly. And the cavalcade continues. Still to come, well recap todays events and look forward to more, apple, ford, visa, gm all putting numbers out. And if your destination was a tropical paradise, your airline may be number one. Hawaii airlines joins us to discuss its latest results and success in the skies. [ girl ] my mom, she makes underwater fans that are powered by the moon. She can print amazing things, right from her computer. [ whirring ] [ train whistle blows ] she makes trains that are friends with trees. My mom works at ge. Tdd 18003452550 can take you in many directions. Spark your curiosity my mom works at ge. Tdd 18003452550 you read this. Watch that. Tdd 18003452550 you look for whats next. Tdd 18003452550 at schwab, we can help turn inspiration into action tdd 18003452550 boost your trading iq with the help of tdd 18003452550 our live online workshops tdd 18003452550 like identifying market trends. Tdd 18003452550 now, earn 300 commissionfree online trades. 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During the cadillac summers best event, lease this all new 2014 cts for around 459 a month or purchase with 0 apr and make this the summer of style. Welcome back. Hawaiian Holdings Stock surging today. Its the Parent Company to Hawaiian Airlines and they are up in the range of almost 14 after strong earnings. A profit of about 27 million. Joining me now in a cnbc exclusive is hawaiian air ceo mark dunkerly. Mark, welcome to the program. Well, thank you very much for having me. So, we understand the strong performance, and not just in terms of your financial results. You guys are one of the airlines thats most on time of any. Theres a bunch of headwinds out there in the world right now, though. Theres the fuel issue, which could become a problem if the geopolitical tensions heat up. Do you guys hedge for fuel . How concerned are you about whats happening in your industry around the world right now . Well, first of all, i think from what we can see out the windshield of our business, things actually look pretty good. Demands been very, very strong in all our geographies, and at the moment, we certainly dont see any impact from some of the geopolitical tremors. With respect to fuel, we hedge our fuel forward. We dont try and second guess the market. We hedge to dollar cost average fuel expense at the time. And i want to bring in the panel for some thoughts here. Herb . Yeah, hey, mark, this is herb greenberg. When we see how well you appear to be doing, when i ask the question, and that is, you know, what makes you different, its really the question of what makes you different in terms of what youre charging for and what youre not . Or is it because you have such a captive audience . Every time i see one of your planes land into my home, san diego, i always want to be jumping on one of them. Well, firstly, im glad that thats the sentiment that you have every time you see one of our airplanes, but essentially, in our business, its terribly important that you stand for something and that you have a proposition to the customer that separates you from everybody else. And what we sell is hawaii as a destination. People have this fantastic view of hawaii because its an appropriately realistic view of hawaii, and we try and capture that in everything that we do, on board and on the ground. Understood. What about consolidation in the future across the airline space, mark . I mean, weve seen some pretty significant moves in the last couple of years. Where does that leave your company . Well, you know, yes, weve had a lot of consolidation in the industry, and of course, the large have become larger. That has really two impacts for us. One is it actually gives us more of a niche to exploit, so weve been growing very, very quickly. Weve grown and weve grown profitably, which in our industry is actually quite a hard thing to do at the same time. We are mindful of our consolidated competitors. They are becoming increasingly focused on the business traveler, on having a network that spans the globe. We, by contrast, really focus on selling hawaii, as i mentioned a moment or two ago. And so far, we found that the traveling public interested in coming to hawaii has responded extremely well to that. Yeah. Hey, Todd Schoenberger. You mentioned how geopolitical events are not impacting your airline. I know you dont fly into tel aviv. Would you voluntarily or willfully keep your flights, if you were flying to tel aviv, would you keep from flying there . Well, you know, we take our guidance about the safety of air space from the faa and from other sort of competent aeronautical authorities from around the world, and i think thats from whom we would take our guidance. Airlines are not equipped to make that call all by themselves. They need the information thats provided by governments. I think its entirely appropriate that the u. S. Federal government in this instance has made the call. Im not close enough to know whether its a reasonable call or not. We have to assume that it is. Mark, you bought airbus, not boeing. Why . Well, first of all, both manufacturers make great airplanes, and you know, we do operate a fleet of 18 boeing 717s, which is an airplane were extremely fond of, as well as the 7767s that are retiring fro our fleet. But each airplane is optimized for a certain mission, and it so happens that the missions that we fly are best suited to the airbus a330 for the long haul and also for the a321 neo, which is a narrow body with some pretty impressive range that will be coming out in a couple years time. Mark, well leave it there, but first, what do you think is the biggest risk to your line of business in months ahead . Well, the biggest risk to our business is always Consumer Sentiment and their willingness to come on vacation. As i say, weve seen no dampening of that so far. It is, you know, a fickle thing. We cant by any means guarantee that, but so far, weve seen no indication that that has been impacted by global events. And we understand the Share Performance today in light of that. Mark, thank you for being here. Wl appreciate your time. Mark dunkerley, hawaiian air ceo. Its been one big Earnings Report after another since the market closed. Next, dominic chu will try to round it all up for us. And a programming note. We have an exclusive interview with president obama tomorrow. Steve liesman is sitting down to tackle all things economy, from taxes and economic patriotism to the minimum wage and much, much more. Tomorrow, 5 15 p. M. Eastern live, exclusively on cnbc. State were changing the way we do business, with startup ny. Weve created tax free zones throughout the state. And startup ny companies will be investing hundreds of millions of dollars in jobs and infrastructure. Thanks to startup ny, businesses can operate tax free for 10 years. No property tax. No business tax. And no sales tax. Which means more growth for your business, and more jobs. Its not just business as usual. See how new york can help your business grow, at startup. Ny. Gov welcome back. A lot of movers to bring you up to speed on. We had some fast and furious earnings, domenic chu joins us with the recap. Dom. Holly, moly, its been a lot. Record high shares for facebook, they posted better than expected sales. Facebook, you can see theyre up about 4 near after market highs. At t is moving lower after coming up a penny say. Trades down for at t in the after hours. Qualcomm posted betterthanexpected profits for the First Quarter. It forecasts the quarters results below consensus view, the licensing business specifically with regard to china. Can you see those shares down 4 . Gilead hepatitis c drug had sales up 3. Trip adviser missed in the bottom line, down about 10. 5 , kelly, in the after mark, over to you. Stick with trips to half. Up next, look at the challenges of breaking news in 140 characters. Tomorrow a coffee clash. Starbucks and duncans are releasing earnings. Closing bell will have the numbers. Well be right back. How do you know which ones to follow . The equity summary score consolidates the ratings. Welcome back. Qualcomm earnings, we just spoke to the companys president. John. We got offer with the president , derec dunkerly. He says it has to do with the licensing business, they got some businesses if chosen, particularly lower to your tables that have 3 g if them him qualcomm is not getting the licensing fees, they are going out trying to get that. There. They think some of their oems, based if china, are under reporting the number of devices, maybe so they dont have to pay qualcomm as much. They got auditors going out to try to catch that. He says the battle is going well at pedia tech at the lower end in markets i can china, they will be out with few products soon that continues to address that market cap. John, thank you. We should note. Qualcomm shares moving lower after hours now, nicholas, the reaction to that. What are you watching generally for folks here . We were watching amazon being smaller tan the mark cap. Its a silly football, its impressive, its amazing 189 to 163, suspect leak that. Its extraordinary. This company a few minutes ago we were talking zero and mobile app revenue, i remember being on cnbc, its coming it came. Kaboom, its huge. In a huge way. Is is that what you are watching tomorrow . Facebook and new home sales come out at 10 00 a. M. Its critic. A we havent seen the data thats there to support a recovery. We just had Don Peebles Diehl telling us the Housing Market was stronging look at the residential sales, people may be differ. They sold 25 million piece of property for 125 million. We have one permanent to argue, thats on the higher end. Look at Everything Else thats out there. You havent seen new construction data. It doesnt bode well the rest of the year. Caterpillar, Pay Attention to the earnings, they report the rolling threemonth retail sales for june it was down 20 . Its been that way. The street seems to ignore that. Quality does count at some point. Just watch the fine print of the result, todd. Im looking, herb. Tomorrow, by the way, caterpillar results, they dont just talk about their own business, they offer a whole view globally and economically what we can use at this junkture. We feed that. We have to talk about global gentleman demand, forecast. Im telling you, herb. Those glasses you are wearing have so much rows on them. You love me, herb, im telling you, you have to look at the global story, that hems with the caterpillar number. Its a busy hour, i appreciate the thoughts and the guests that have come through. We hand it ooff to fast money in just a few minutes. What are you focusing on . We are talking facebook, qualcomm and gilead, a big move in biotech, there is one company in particular on the radar of one of these traders of some unusual options activities. We will fame names in the next hour. Important stuff. Over to you. Thank you, fast money starts right now. Right from the nasdaq markets, im melissa lee, big earnings in the past hour, facebook sales rising after carl sand sperg eberg says they have 1. 5 million active advertisers him well bring you updates throughout the hour. We have suntrust, monitoring the shares. Shares are falling after subscription revenue coming in below expectations. Angies list, Third Quarter guidance is falling short of expectations, our traders are tim seymour,