Or certainly at the white house for us today. Outside im told, forgive me. Eamon, what are you expectations today . That the president is going to talk about an infrastructure proposal here, a piece of a larger agenda theyre going to roll out later in the year. Were talking to white house officials before this event as we wait for the president to come in and were seeing theyre going to break this out as a separate piece. The air Traffic Control privatization piece then later, theyre going to introduce a broad Infrastructure Program and they expect this will be a only piece of the agenda that will be broken out and go a separate track. The rest of it, theyre optimistic they can have done by the enof the year. There is the president of the United States at the microphone right now. Thank you very much. Thank you, mike. I really appreciate everything and i appreciate your being here. But i up want to thank secretary chow leader kevin mccarthy, thank you, kefren. Chairman bill shumooser and all the members of congress who had many here today for joining us as we prepare to enter a great new era in american aviation. Its ab time, too, i can tell you. But before discussing our plans to modernize air traffic, i want to provide an update on our efforts to fix and modernize e Vital Services for our veterans. Our great, great veterans, who we all love. For decades, the federal government has struggled to accomplish something that should be very, very simple. Seamlessly transferring of veterans medical records from the Defense Department to the veterans groups and to the va. In recent years, it has take ben not just days or week, but muhao months for the records to follow the veteran. This has caused massive props for our veterans. Im proud to say we are finally taking steps to solve the situation once and for all. The secretary announced that the va will announce and modern ice its medical records to use. The same system and department of defense, no more complications. Meaning faster, better, and far better quality care. This is one of the biggest wins for our vet raps in decades an i congratlation the secretary for making this very, very important decision. Thank you, secretary. Appreciate it. Hes done a great job. Stand up, secretary. Where is secretary . What a great job. Thank you. Of course rs there is sill much work to do, but for todays action, shows the determination leadership and what it can accomplish. Great, great reform. So again to david, thank you to all of our veterans who have served this nation, a very, very special thank you. This is truly wonderful. Really monumental reform. So important for our veterans. But its just the beginning. Were here today to discuss another issue that has gone unsolved for far too long. For too many year, our country has tolerated unacceptable delays at the airport. Long wait times on the tarmac and a slowing of commerce and travel. That cost us billions and billions of dollars in lost hours and lost dollars themselves. Today, were proposing to take american air travel into the future. Finally. A long time. Were proposing reduced wait times, increased route efficiency and far few uer delays. Our plan will get you where you need to go more quickly, more reliablely, more afford bly and yes, for the first time in a lopg time, on time. We will launch this air travel revolution by modernizing of air Traffic Control. Its about time. Since the early days of commercial air service, the federal government has yet more than a half a century later, the government is still using much of the exact same outdated technology. At a time when every passenger has Gps Technology in their pocke pockets, our air Traffic Control system still runs on ground based Radio Systems that they dont even make anymore. They cant even fix anymore and many controllers must use slips of paper to track our thousands and thousands of planes that are up in the air. Our air Traffic Control system was designed when roughly 100,000 people flew our airports each year. We are now approaching nearly 1 billion passengers annually. The Current System cannot keep up. Hasnt been able to keep up for many years. It causes flight delays and crippling inefficiencies, costing our economy as much as 25 billion a year in economic out. We live in a modern age, yet our air Traffic Control system is stuck painfully in the past. The faa has been trying to upgrade our nations air Traffic Control system for a long period of years. But after billions and billions of tax dollars spent, and the many years of delays, were still stuck with ancient, broken, antiquated horrible system that doesnt work. Other than that, its quite good. The Previous Administration spent over 7 billion trying to upgrade the system. And totally failed. Honestly, they didnt know what the hell they were doing. A total waste of money. 7 billion plus plus. Its time to join the future. That is why im proposing new principles to congress for air Traffic Control reform. Making flights quicker, safer and more reliable. Crucially, these reforms are supported by air Traffic Controllers themselves. Theyre the ones that know the systems that they want. They know it better than anybody. And we have people that dont even call them. In the past. But now, we call u them. Im also proud to be joined today by passenger advocates, pilot unions and leaders of airlines and Cargo Companies who strongly support our new framework. And our bidding process. And were bidding ideally to one Great Company. There will be many bids, but one Great Company that can piece it all together. Not Many Companies all over the United States like in the past when it came time to piece it together. It didnt work. There were all different systems. We threw away billions and billions of dollars. I am very grateful that every former faa chief and chief operating officers and three former transportation secretaries, jim burnley, Elizabeth Dole and mary peters stand with us today. Thank you. This is an incredeible coalitio for change all over the room. The leaders of the industry. At its core, a new plan will dramatically improve americas air Traffic Control system by turning it over to a selffinancing, nonprofit organization. This new entity will not need taxpayer money. Which is shocking when people hear that. They dont hear that too often. Thurnd new plan, the federal Aviation Administration will focus firmly on what it does best, safety. A separate nonprofit entity would be charged with ensuring route efficiency, Timely Service and a long awaited reduction in delays. Our plan will also maintain support for Rural Communities and small airports, including airfields used by our Air National Guard units. Great people. And very importantly, air Traffic Controllers will highly and this will be highly valued, these are highly valued people, these are amazing people that know the system so well. And under our plan, they will have more financial security, professional opportunity and far superior equipment, the best equipment anywhere in the world. Theyll never be anything like what were doing. And other systems are very good. I wont tell you the names of the country, but we have studied numerous countries. One in particular, they have a very, very good system. Ours is going to top it by a lot. Our incredeible air Traffic Controllers keep us safe every day even though they are forced to use this badly outdated system. That is why we want to give them access to Capital Markets and investors so they can obtain the best, newest and Safest Technology available. By the way, the new technology is is increde bable. If we adopt these changes, americans can look forward to faster and safer travel. A future where 20 of a ticket price doesnt duoto the government and where you dont have to sit on a tarmac or circle for hours and hours over an airport, which is very dangerous, also, before you land. Dozens of countries have already made similar changes. With terrific results. And were quoing to top them actually by a long shot. Canada is an example modernized their air Traffic Control through a Nongovernment Organization about 20 years ago and they have cut costs significantly. Adopted cutting edge technology. And handled 50 more traffic and actually, far more than that on a relative bases compared to us. A modern air Traffic Control system will make life better for all americans who travel, ship or fly. It will reduce costs and increase convenience for every american consumer. And these new efficiencies will produce a huge economic boost for the country and for the one in 14 american jobs that aviation supports. Today, we are taking the first important step to clearing the runway for more jobs, lower prices and much, much, much better transportation. Americas the nation that pioneered air travel and with these reforms, we can once again lead the way far into the future. Our nation will move faster, fly higher and soar proudly toward the next great chapter of american aviation. Thank you, god bless you. And god bless the United States of america. Thank you. Thank you very much. Thank you. That is the president of the United States beginning his push for air Traffic Control reform. You see the president and other dignitarie dignitaries, other members of congress. Ted cruz there, the House Majority lead e, kevin mccarthy, as well as the president is going sign a letter he will send to congress to do what he said today. We live in a modern age, he recollects but our air traffic system is stuck painfully in the past. The president proposing what he says will take american air travel into the future, leading to fewer delays, fewer wait times, to get you there on time. Phil lebeau along with eamon as the president signs that letter. Phil, the president said its going to lead to an air travel revolution. Your thoughts . Potentially. Look, thats the hope that you have a new system thats in place that will incorporate new technology, that will make a system run far more efficiently. Now, its going take some time for this transition to actually take place if this is approved by congress and if it does, youre looking at at least three years for the transition to take place into this privatetized air Traffic Control system then you have to have the equipment brought in both at the air Traffic Control centers then you have the airlines although most of the airplanes because theyre flying worldwide, most of the airplanes have a lot of this xhimt already, but in theory, guys, this has been implemented in more than 50 other countries and those systems operate more efficiently than our system, so, it should cut down on delays. It should mean you have less congestion when youre flying into new york. Let see if that actually happens, if this goes through over the next five or six years. Weve all been there. As the president said, those delays, waiting on the tarmac for hours. Eamon, phil really said the operative words here. If it is approved, notable of course that the majority leader, mccarthy, is right by the president today because its going to fall on his shoulders heavily in the house to shepherd this through. You see the president there shaking hands with the chairman of the house transportation committee, who will play a big role in this as with well. The visuals youre seeing here, the president sitting at a desk signing something surrounded by the republican lew makers in this case, it looks a lot like the end of a process looks, but this is not a bill sign iing, n an executive order signing, this is the president signing a letter telling congress he would like them to go down this road with some piece of legislation. Bill shuster has had this for a while. This is an idea thats been around washington since the clinton administration. That cuts two ways. It could be a good thing because this is a time tested proposal. The other problem is this is a proposal that hasnt passed over the past 20 years and now, this is going to be the challenge. This white house says this year, they think they can do it because theyve got control of the Republican House and senate as well as a president who will sign it into law. But this is very much the beginning of a process here, not the end. One of the areas here today, reaction among the airline stocks, in your conversation with some of those companies and the leaders of the airlines, are they in favor of this move . Yes. Yes, generally speaking, almost every Major Airline is in favor of this. Now, as i mentioned last hour, delta has expressed reservations about moving towards a nonprofit entity outside of the faa controlling air Traffic Control. As im not sure that, those reservations are enough to slow down this transition. You have so Many Airlines that are in favor of this, the opposition going to come from your general aviation both operator swelz manufacturers, who fear that if you have this entity that the airlines have a large influence on, that they basically will box out general aviation from a number of airports, but my sense is that that resistance is something that can be overcome. Phil lebeau, appreciate it as we watch the president begin his push for the privatization he hopes of air Traffic Control. Want to welcome you back. When our top trade is all about apple. The call that is sending those shares lower today. Real question is should you take profits in what is the dows best perform year to date. With us today, joe, josh, jim, steve, we want to begin with apple. Josh, im wondering what you make of this call today from pacific crest, which says the upside from the iphone 8 is priced in. The risks are not. They downgraded today and they say take the money and put it elsewhere, maybe into alphabet. I think its reason bable to make the case theres a lot of enthusiasm in the share price. We know its up 30 mers this year. Nobody thinks the fundamentals have gotten 30 better in five months, so fine, you can say that. Were talking about the p in pe. And nobody knows what multiple investors will be willing to pay as they roll out the 8, the tenth anniversary phone and i want to make a bigger point. If you cant sustain a 10 drawdown in apple stock or any other stock for that matter, because of a shortterm issue about earnings or valuation, you shouldnt earn it and frankly, the real investors in this name, what theyre concentrating on is where apple is in augmented reality and am by enter computing. Thats the only thing matters for google, microsoft and facebook. If they dont have an answer, then none of this stuff about how many phones they sell this quarter or next is going to matter. Thats the future and thats why people are buying the stock right now. I always go back to what jim cramer says at every opportunity he gets. That is if you heed the advice of an analyst who gets a little negative on the stock and urges you the take some profits and put them elsewhere, how in the heck are you going to know when it is the right time to get back in, that apple is not a trading stock, that it is an owning stock . Hes been right so far and i think thats going to continue for a while. Undoubtedly, theres a lot of an the tis patience in the stock price already, however, its not only that. I would say its only that if we havent had the other tech stocks and nasdaq as itself very such a huge move. Its impossible to say its 60 there, 40 anticipation. If you read his note, hes talking about sales in iphone underpressuring 2019, so whether you get a disappointment on the rollout on the iphone, i have no idea. I dont think he does either because you dont know what the futu features are, to me, its a safe stock at this point. One of f the safer stocks there, despite the fact theres been such a big move. Im not, im not a you know, sycophant for you know, apple. I just think thats a good place to put money in the market. Thats getting you fully equipp equipped. Is it time to start looking elsewhere and put it into areas you think have better prospects in the shortterm . I think there are great prospects out there, but ill tell you, im not using apple to fund those. This is you said it with jim cramer, its an investment, a buying stock as opposed to a trading stock. Its a longterm investment. The analyst has an opinion on the iphone 8. We have a different opinion. I think its going to be a blowout. But what i note about his comments, is that he takes up next years earnings by 31 cents. Takes down this years by nine cents, on net, thats actually an upfwrad to the earnings and i dont see how he gets to a negative call from that. But ill leave that to him. I think this is one of the safest stocks to own. I want to say one thing. Josh is right. Not just about apple, but any stock. If you cant take a 7 draw down in a stock, you shouldnt be in the stock. Zpl if i told you that apple before this year is over, will take a minimum 5 decline from where it is today, what should you do . 5 to 10 ler. For someone who owned apple in 2016, i would use that 5 to get back in. If you knew it was going to go down 5 sometime for the rest of this year, would you take some profits today . No, if i owned it, no, i wouldnt. Are you going to spend your whole life in front of the screen waiting to buy it . Goes back to your original point. If i know its going down 5 a , say i get out of it. How do i know when to get back . . The reasons go beyond the iphone 8. They are about the Services Side of it. The reasons are, i looked at positioning this morning. You would think this is overowned . Hedge funds, yes, are overweight. Apple. Mutual funds, large cap mutual fupds, the average benchmark is 3. 6 f for apple. You would think 3. 6 or well above that. Now, youre going back to the old argument that icahn has made. A defactor short squeeze when you have these funds. Correct. Its a 90 basis points differential. Theyre underinvesting. Maybe this is a broader comment. Maybe you have other analysts in other stocks come out and say, many of these large cap tech stocks this year are starting to look a little bit. I wouldnt go with many. The fangs with with two as. Facebook, netflix, et cetera. I think within the faang, that alphabet and apple are should be taken out. They are not overpriced. We can make arguments about the other three. But those two are not overpriced and frankly, you just see no signs of cracking. Whatever i say about amazons share price, it goes up every day. My issue with this is is is what lurks in the background is theres complacency with apple. I dont know if you sell it, you have to get back in. Ive never believed you have to own a e certain stock nor do i believe that you have to play the benchmark like joe is pointing out. So, if you want to outperform them or catch up, youre not going to make it in apple because its so owned by the indexes by definition, so youve got to find the risk and reward elsewhere. Its a perfect day to discuss a note like this. Because apple is one of the stocks were hitting today in a series of special interviews. We have the number one ranked analyst in the computer hardware sector she covers retail for Morgan Stanley, so we want your questions on those topics. Hardware, health care, retail. Specific stocks you care about most. Tweet them to us. At halftime report. Were going to give them to the analysts, get their takes then give them to the panelists. Lets talk about herbalife. The company lowering its Sales Outlook for the Current Quarter in part because of disruptions caused by new federal trade Commission Regulations that took effect last month. I first reported the news last night saying revenues would likely be. 5 lower. The company did raise earnings estimates for the quarter and full year. They said it easily surpassed an ftc threshold mandating that sales outside the network must be at least 80 . The company says 90 of sales in may met that key requirement. Now the form eer ceo, the compa is now lowering guidance. Somehow claiming that it is surprised by reduced volumes the first month. Theyre focused on the fact the company cut sales guidance, however, the issue that they were able to show, that 90 was allowed to be for the personal con sunlgts is pretty key. It goes against what ackman and the most fervent bears have been b saying that the company doesnt have any Real Customers. Now, they say no, in fact, we have customers. Not only can we prove it, we dont just have the 80 , we have 90. The skeptics an bears are going to say how are they measuring its 90 . Theyll be suspicious. Theyll say well, theyre just classifying the buyers elsewhere. So that issue is never going to go away in my view. In terms of them beating on the bottom line, but missing on the top, that to me is a worrying situation because that means that its probably cost cuts, so its margins that have expeande and theres a zero sum game. So i prefer flot to be in the stock at all. The disruptions cause bid ge gearing up, were expecting to have an impact, but like others have in the past with this company, well overcome that. In the second half, we expect a rebound. Sfwl tthe point steve the makin good one. There are questions to be b raiseded here. However, i dont think when youre look at the stock and the numbers its putting up, i dont think theyre exist ten shl questions. I think clearly, its showing that we can have a debate about whether its earnings are growing. Whether the price is is right, but the price does not look to be zero. The tok stock last week was near an all time high. Its taking the weight of this stock and saying its notd going out of business. We can discuss margins and multiples. I disagree we take the market taking this to a high and saying well, the judges have voted because there are technical and mechanical aspects of these types of trades that can give you a price thats way far away from what the market will ultimately be willing to pay and the best example of that is valiant. That was a stock that went up to 250 a share and ended up at 9 inside of a two year period. This idea that the market is finished, weve all decided the short case is nonsense. I think its pra mature to call victory on that. You have a ton of short sellers in here. You have lot of people buying it for other reasons than they want to be investors. They want to drive someone else into the poor house. That stuff can play out over time, but ultimately, thats not what is going to determine stock trades. You have Big Hedge Fund players in it and its a liquid type of name. Not a name thats owned on the institution side. 5 billion. If euro kyou are josh brown andg a large short stake, youre going to have an opportunity to get out of the stock and cover a large position. That opportunity was 2014. You had the chance many 2014 to cover the short. It has done nothing but continue to move higher since 2014. You have analysts raising price targets on this to 120. Are they correct . No clue. But clearly, the pressure is on someone right now who is short this name. Herbalife would say that im not saying its like valiant. Legitimizes in their mind once and for all that they have Real Customers and theyre a real business. Valiants business, primarily, m a, acquisitions, big acquisitions and raising drug prices and when you took away the possibility of doing m a because the debt load got too big, you took away two cogs in the wheel, two spokes in the wheel of what was giving the Company Growth to begin with. So, okay. Fine, but we can look at any stock and play that game. Youre 100 right. I dont disagree with you. But they have Real Customers that were finding ways to pay for things that werent so kosher. This is not that, clearly, but you had a similar situation with hedge funds crowding in on the long side. Shorts getting squeezed out even though they ended up being right. What im basically trying to say is that in this situation, it could end up the same way, not saying it will and im not saying its apples and apples, however, its important to swrus point out. Now youre spiking back up to 32 . Things are getting interesting again on both sides and we shouldnt just assume because you make a new high, that all of a sudden, everyones been invalidated. Lets go to health care now the Worlds LargestCancer Research conference underway in chicago. Meg is live there and she has an exclusive interview today with the ceo of the Company Whose stock is up 50 today alone. Meg, the company and your guest. Scott, thank you so much. Joining us now is the loxso ceo. Look iing at your stock today, really tells part of the story here, youre one of the breakout stars of this years condition frens. The approach is a different one. Instead of testing a drug in lung or prostate cancer, youre going to have a genetic mutation found in multiple locations in the body. Tell us about this approach. We had a very exciting weekend. We showed some data that said what you just did. Doesnt matter what site of the body your tumor came from originally, what matters is what makes it tick, what made it a cancer in the first place, so we enrolled broadly a trial that included adults and children and treated them the same way and we saw just by taking a pill pritw a day or liquid formulation for a child, that the tumors shrink dramatically and the good news is they seem to stay away for a long time. One of the things people are really commenting on is is the number of patients in the trial who benefitted. Some calling this even unprecedented, the kind of response youre seeing. Right, three of four patients had whats called a response, which means their tumors shrank dramatically enough to call it that. And the reason we were able to get the Response Rate that high i think is one, were developing a great drug. A therapy that works and does its job, but also, were being very careful about how were choosing who to enroll. Were being very selective and using a diagnostic test to find the right patients who can respond dramatically. If theres one take away or call to action that id love people to hear, which is get your tumor tested. Figure out what is making it tick so you know what is the right therapy that can be matched to your tumor. Thats the main question i had because that mutation is rare. Like 1 of cancers, how do you find the patients that will benefit from this drug . There are diagnostic tests out there that people can access. We have created a website called trk testing. Com. It has information about the target we care about, the trk ork track fusion, but it has information that can be helpful for your larger question and there are lab bs that are in the hospitals that people use already. There are labs that can be specimens can be sent in the mail. So, really, it requires a call to action and knowledge that its important and to talk to their doctor about how do i get my tumor tested in the most comprehensive way possible. Well, well have to leave it there for mow, but well continue to follow the story of these promising results. Thanks. Thank you. Scott, back to you. What a day to have that interview and for more on health care and the stocks you should own and avoid, we welcome inially in l in lisa gill. Its for our special event. Analyst versus panelists, three of the top Research Panelists joining us today. Were taking your questions on the stocks that matter most to you. Heres our first. This is matt from pennsylvania. My question is with amazon moving into the pharmacy business, how will this affect cvss numbers Going Forward . Its a good question. It is. We got this announcement, the shares traded lower, so, what do we do now . They did. I would be a buyer of cvs and heres why. If you think about the pharmacy business, its incredibly complex. The mail order business has been around for 40 years, so we have mail order pharmacies today. If they want to get mail order, they can. You think you need pharmacists there, its not just your average low income employee thats running these. I think people forget this, that north of 75 of prescription volume is with people that are over 70 years of age. The average 70yearold takes 40 prescriptions a year. All of us probably in our 40s are taking somewhere around 12, so grandma wants to go to the pharmacy. We see them going into the store today, but cvs has to change. Larry murillo was the first one to take the cigarettes off the shelf. I think youre going to see that market change over time. You think about going to cvs. So, didnt in other industries, didnt like mass merchandise retarial say the same thing . The serious cars catalog, they e same thing, then in the last two years, oh, wait a minute. I think the difference honest ly is who pays for that. You are paying for that yourself. Youre going out at a consumer and buying it. Most of us today pay litting for what our health care dollar is. On average, the average copay is about 25, if they can save 10 , thats 2. 50. Its really coming from the other side. I have been a frus trayed cvs buyer, im not in the name anymore. What is the Growth Initiative for this company where you can begin to see the stock move higher and really do you think theyre at the, the initial stages of the same brick and Mortar Retail issue . So, first up, i think they have to change the script. I think the footprint will change. You hear Companies Like aetna say hey, we want you to put more into your stores as it pertains to health care. They have over 1,000 minute clinics. Its a great experience. Probably think iing about movin lab in there, hearing, vision, so i think you have to change whats in that. I think you dont need 10,000 square feet store. So maybe half of that he hose to more of just a pharmacy and some over the counter type of products and you dont have the same lawsuit because amazon can go after that consumer part of the business. Not necessarily on the prescription side. If you think about the businesses they put together, caremark and cvs, i think that built a fortress a little bit to come back for them. Everyone forget that is cvs has 1. 5 billion prescriptions through caremark today. Theyre going to get more of their own business over time. It was a hiccup this year. They didnt anticipate losing the department of defense contract. That was 25 million prescriptions. I think they were consistently winning business on both sides, then you lose a little and see how quickly that leverage you get starts to unwind. I think they didnt take the cost step they needed to. This year to me is a rebuilding year. Theyve got take the cost out and we move forward to 2018. So for our viewer who asked the question, panelist, not so much. You want to ask weiss about another stock in the coverage universe. Express scripps. When they came to business, it was a great business model. Now, you have so many managed care companies, now, the power has changed from express scripps to managed care, where they go out and say we want to pay x, give you marginally x. So, its a question as to why they exist today in my view. Ipg thats a good question and most people in america think theres five health plans out there. If thats case, if we get to where theres just several, youre goung to be right, but the problem is today that most employers want to carve out their pharmacy benefit and keep it separate from the medical benefit. And secondly, theres hundreds and hurricanes of small health plans out there today, so theyre aggregating on behalf of those. Not anthem is a large customer, theres anthem could probably do this on their own, but its really the smaller players. What people forget about health care is is we think globally, but everything happens locally. Theres hundreds of smaller players out there, theyre still aggregating on their behalf. I like the business model. I think im the only person in america who does. I think they bring real value to the equation. Its not just about the cost, but its also about managing the care for the patient as they move towards higher priced drugs on the specialty side. Thank you for coming in. Great to have you. Wed love to have you back some time. Two more number one wall street analysts are just ahead. Bernsteins tony on hardware and apple. And Morgan StanleysKimberly Greenberger on all things retail. More halftime back in two. Can we at least analyze customer traffic . Can we push the offer online . Legacy technology can handcuff any company. But yes is here. Youre saying the new app will go live monday . Yeah. With help from hpe, we can finally work the way we want to. With the right mix of hybrid it, everything computes. We cut the price of trades to give investors even more value. And at 4. 95, you can trade with a clear advantage. Fidelity, where smarter investors will always be. And at 4. 95, you can trade with a clear advantage. For years, centurylink has been promising fast internet to small businesses. But for many businesses, its out of reach. Why promise something you cant deliver . Comcast business is different. We deliver superfast internet with speeds of 250 megabits per second across our entire network, to more companies, in more locations, than centurylink. We do business where you do business. Welcome back. Were continuing with our special event today. Were joined now by the number one tech hardware analyst on the street. Tony, good to have you as always. My pleasure, scott. One of our viewers has a question for you regarding apple. Lets listen. Hi, this is ron from illinois and i was wondering if apple was going to hit 200 a a share by the end of the year. Thank you. Sxwl all right, tony, thats the big question. Were at 150 what, three . Correct. I think thats a tough bet to make. Youre looking at another 30 plus percent increase on the stock. It would take the market capitalization well over a trillion dollars. Just very, very large numbers, so, i think the way that we think about where the stock can go we look at the relative multiple that apple had in the last big iphone cycle, which was the 6. If we take that relative multiple and pli to current earnings, we get to b about 172 a share. If you believe those earnings for next year are going to go up because the cycle is bigger and they go up another 10 , youre looking at stock that maybe hits 190. Thats a framework by which to think about it, but id say the 200 handle is is a very ambitious goal for this year. Yeah, i dont know where ron got in. So, i cant say how much upside he would really love. But what about this note today from one of your competitors, say iing that iphone 8 is price in, risk bs maybe arent . Look, i think its very difficult for any stock to know whats priced in and i think the way we think about it is to look at prior cycles, again, as i articulated, if we see a similar multiple, we could get a stock between 1 is 70 and 190. Now, we can debate whether it deserves a similar multiple of two or three years ago. On one hand, you could say were closer to the end in terms of the smart phone industry. On the other hand, i think you could argue apple has more cash as a percentage of its market cap, which is true, and services which are recuring are a bigger part of apples business, so i think you could debate it either way, but our analysis suggests this stock in the two and three months proceeding product launches is has youtperformed n out of ten times and theres a bet were comfortable make iing. We have another question from a viewer on twirt. Its vince. Who says how many iphones does apple need to sell to justify a 200 inkrecrease in market cap how do you grow what he says is a 700 billion beast. Yeah, look, the law of large numbers is very difficult. The way that i think about it is every million iphones is about 3. 5 cents in earnings. So, if if you know, if apple sells 30 million more iphones, thats an extra dollar on earnings and maybe you get a 15 times multiple on that. And so, you know u, ultimately, you get an extra 15 a share. 15 a share is roughly 70, 7. 5 million in market cap. So thats kind of how we think about trying to dimension, how to think about iphone sales and market cap increases. Since this is analysts versus panelists, one of my panelists has a question for you. Its about wwdc, underway momentarily. Hey, tony, its josh. Im sure there will be some new ipad stuff and things like that, but what Everyone Wants to hear about, at least from what ive read and heard, is siri, whether or not theres an alexa killer on the other side. How seriously apple is taking personal assisting. Well, i think youre right. Thats probably the key question. Id be surprised if they had a product this soon. Its possible they could preview it. Id say thats probably less than 50 in my eyes. You know, apple has a digital assistant called siri and the phone is with you at all time, so, the question is what incrementally would a more stationary digital assistant provide. Certainly, it has some con venus yens in terms of being in a fixed location, but again, most people usually have their iphones so this would be likely something that would try and have you know, very significant audio capabilities to distinguish itself from the phone, but again, if i were to put odds on it, i think the its less than 15 50 and certainly at this point given the scale of apple, its not changing. Tony, im sure at some point, you get since im sure at some point you get sick of being asked about apple, lets ask you about tesla before we have to let you go. Im looking at your most recent post. My tesla experience not good and why that might matter. Whats your view and what do you mean by all of that . My worry is that it tesla will go from selling 80,000 cars a year to 4,000 or 5,000 in the next two years. And right now the Customer Experience is strained. It can take a couple weeks to get an appointment. There are issues in terms of delivery of the car. Its not seamless. Its not seamless in terms of getting financing. They use a Third Party Financing organization, u. S. Bank for most of their leases. And so we worry that if certificaservice and sales are struggling to keep up with 80,000 cars a year, we worry about if the Customer Experience is poor, that could undermine teslas brand and probably the key ingredient. I got you. Well talk to you soon. One more top wall street analyst is next. Morgan stanleys kimberly green berger takes part in analyst versus analyst. Were talking retail. Otion. Im fine. Okay, well lets see you get up from the couch. Im sorry, what . Grandpa come. At cognizant, were uniting doctors, insurers and patients on a collaborative care platform, making it easier to do whats best for everyones health, every step of the way. You may need more physical therapy. Ugh. Am i covered for that . Yep. Look. Grandpa catch grandpa duck woah ha there you go grandpa. Keep doing that. Get ready, because were helping leading Companies Lead with digital. So we know how to cover almost alanything. Ything, even a coupe soup. [woman] so beautiful. [man] beautiful just like you. [woman] oh, why thank you. [burke] and we covered it, november sixth, twothousandnine. Talk to farmers. We know a thing or two because weve seen a thing or two. We are farmers. Bumpadum, bumbumbumbum looking from a fresh perspective can make all the difference. It can provide what we call an unlock a realization that often reveals a better path forward. At wells fargo, its our expertise in finding this kind of insight that has lead us to become one of the largest investment and Wealth Management firms in the country. Discover how we can help find your unlock. We are back with our next leg of analyst versus analyst. Toprated analyst, kimberly, good to have you. Here is a viewer question on the threat to retail from ecommerce. Caller hi, this is jim sheridan from phillipsburg, new jersey. My question is about lbrands and the question i have is the ecommerce business of amazon and alibaba cutting into their market share . And if it is, what are they doing about it . Thank you. What are your thoughts . So my guess is hes probably asking specifically about the victorias secret division. Here at Morgan Stanley we do a lot of customer research. My partner, brian, here covers amazon and we found 50 of americans are buying their clothing on amazon. When we dug deeper and asked them what items, the things theyre buying may not surprise you casual tops, bottoms, shoes, and athletic apparel. What are they not buying . At the bottom of the list, office wear and suits. And the second to lowest is lingerie. We think the simple answer is that its just not that romantic to buy your lingerie on amazon. C amazon. Com. Jim leventhal has a question for you. Thanks for being on the show. I will ask you two questions. One strategic and one tactical. On a tactical sense a lot of the reports were saying that february was so bad because tax refunds were delayed. A, do you believe that. B, do you see it coming back . The second question is strategically to what you were just talking about with apparel, what i heard you saying or implying is casual stuff where the fit doesnt matter so much, you can buy that online. But the stuff where fit matters people are going to do that in stores. And if thats the case some of the categories you were talking about like shoes, for instance, it would seem to me that will swing back to an instore experience. Id love to hear your take on that. As it relates to the fit question, allowing consumers to try product on before they buy. As you said items where fit is less important those items will lend themselves to ecommerce. Shoes are a little bit of an anomaly, the second most popular category purchased on amazon. Com right now and what consumers tend to do is order multiple pairs of shoes. Typically consumers will be maybe between two different sizes and if they order two of something they can be fairly assured theyll get one of the two that will fit them. Shoes that are easier to fit than a complex category like a suit, lingerie or a bra, for example, and, jim, i think i missed your first question. The whole thing about february tax refunds being delayed. Do you believe that excuse for First Quarter same store sales misses, and, if so, does it come back in the Second Quarter . The lower income Consumer Population did get hit in february with the delay in the Income Tax Refund checks. When the distribution from the Treasury Department started to spike it at the end of february and early march. They did not get it all back. And the reason for that is consumers who would have been out shopping on president s day which is the national holiday, many people have off of work if they department have extra money on that work day they didnt have the money to spend. The same with valentines day. Catchup spending was not robust and retailers did not get it all back. At the same time we dont think theres a Second Quarter catchup. What we do think the weather is now finally starting to get warm so you might see some improvement in apparel demand and that is for the Second Quarter. Kimberly, thanks for your time. We appreciate it. Well see you again soon. My pleasure. Kimberly greenberger joining us. So lets get the panelist view on that. Youve picked lbrands before. Kimberly has it overweight. Do you like or no . Im not ready to make the trade there. Thats the one im looking at. Im buying puts in one of those companies. Let me help you out, sears. Theyre paying down debt at j jcpenney. Theres no comparison between the two. Sears is your obvious answer. I dont even want a debate. Lets do final trades. We have some time. I bought cern during the show. Thor Industries Reports after the bell its an rv manufacturer. I think it flows through and both will have good quarters. Josh . Visa and mastercard, look at those stocks, look at those charts, continue to go up. It doesnt matter which retailer. Joe . Microsoft. Its actually done better than facebook and apple. Thank you. Power starts now. Im melissa lee. Unveiling its answer to alexa. President trump pushing his trillion dollar infrastructure agenda laying out his plan to privatize americas air Traffic Control system. Will this become the latest piece of his agenda to get stuck in traffic . And the uk picking up the pieces after another terrorist attack. A vigil under way in london. Well take you there live for the very latest developments. Power lunch starts right now. Welcome t