Welcome, good to have you with us on this new years eve tuesday. Our Investment Committee here today, joe, josh, jim and amy is back the chief Investment Officer of Chevy Chase Trust and one of barrons top 50 registered Investment Advisers for 2019 we begin with the markets. Stocks are trying to end a great year with another day in the green. Bouncing from the worst day in four weeks we do have big news today from one of our very own, hes making a move on a stock that hes been a big believer in for a big part of this decade. Josh brown, selling twitter. Im out feels good. First time out since the ipo in 2013. Tell us the reasoning. First of all, happy new year and thank you for ending your no, im telling the viewers, happy new year by the way, this is completely filled with gray goose, so take everything i have to say with a grain of salt. I got out of twitter today with a very small profit. I had been adding in the 20s, i owned some as high as 40 around the ipo. It has not worked out. Actually, if you compare it to the tech sector, if you compare it to the s p, if you compare it to any of the social media companies, its been a big loser. And this is something that i was thinking about doing later on in 2020 i was going to gradually sell down my position two of the things that made me feel that it was time to move on, number one, is ceo, who is a half ceo, moving to africa next year i really dont understand whats going on with the governance of this company nyu professor and my friend Scott Galloway has it right. Somebody has got to step in, possibly an activist has not happened yet. I specifically asked when i had my conversation in San Francisco and it was the day i think it was soon after the dorsey announcement. It was maybe the day after the galloway op ed, like what in the world is going on here so this is the White Elephant first of all, jack is a beloved figure in silicon valley, just not on wall street very, very different take on how hes built the company, run the company. I still think the company is going to do well i just dont think its a great stock to be in right now there are way too many other opportunities. The second thing that bothered me was this idea that they are going to ban all political spending this is like the only reason i own the stock. This is what twitter does best it influences politics you might not like the direction in which it does so, but its undeniable how influential the platform is. The engagement and the interaction that people have when it comes to the messaging this is electing president s around the world, including here so theyve decided theyre not going to make any money from that so you say whats going on with the platform i wake up this morning, the number one trending topic in the United States is death to america. The number seven trending topic is its okay to be white so theyre going to monetize outrage like facebook but not make any money doing it. I just dont understand what the goal of this company is anymore. Theyre not going to make money on political ads the ceo is going to move to africa and dont send me sympathy cards. I had a great year im in apple, disney i have stocks that are up 200 , 300 its okay. This one didnt work im going to do some other things. When you say youre going to do some other things, do you look at other social mediaesque plays . There arent any. Its facebook and Everything Else i mean, theres snap going to twitter to snap is frying pan to the fire i feel strongly at a certain point twitter will be a better investment and that might be when an activist gets involved and its not to displace everyone at the company, because i think there are great people there. But theyre not serious. This to me just says a lot in a Bigger Picture story heres a guy who in your own right is fairly prolific on twitter. You have more than a million followers. Im not closing my twitter account. Whatever. Im just saying someone who is as prolific as you are who likes the service as much as you do, as a user with more than a million followers, is throwing your hands up and saying as a business, i dont know what in the world is going on. As a stock its not something i want to own anymore. First of all, its 1. 1 million followers. I said more than. I dont want to correct you, but youve got to separate a service you love from an Investable Company ive been very fortunate i found a lot of companies that i loved the service and have made me money. Im in dunkin donuts. Ive done well with these stocks i use google probably five times an hour. Youve got to look at this company objectively and say theyre not in trouble, theyre okay theyre profitable, theyre doing billions in revenue. But theyre not serious about getting to the level that facebook has gotten to and that linkedin under microsoft has gotten tochlt theyre just not there. And they may get there and i may get back in. But right now i dont understand what the strategy is for next year. I wanted to lead with that story. I thought it was important its always interesting when one of our own does something meaningful, especially when its a stock that josh has owned for the better part of the decade. More broadly, is it time to take a look at some of these stocks in your portfolios that you may like as a company, you may like as a service, but it just doesnt work as a stock . I dont know if each of you individually have names like that maybe its a broader lesson for investors who are watching today, a move like josh has made in twitter. Well, i think, first of all, i think its a strong move i respect what he did. I would say that twitter has struggled since the ipo. Its below the market cap in which it actually ipoed at so its never been able to recognize its value. Its operating margin is dwarfed by facebook. I respect what josh is doing ive never really saw the value in twitter itself. I think the time to do what youre suggesting is on the other side of the new year it comes in the form of earnings and if you are able to see companies that you own in your portfolio report strong earnings, but yet there seems to be a perceived exhaustion in the performance of price, i think its time where you begin to pare back allocations. Is it a Facebook World and everybody is just living in it when it comes to social media . If you want to own a social media stock, is that the only one, jim, that you should own . Well, that and i think google and josh just made a case that linkedin is owned by microsoft thats not the biggest growth driver so for the pure play, yes, youre not going to own snap if you have a choice between snap and facebook but if i may, having answered that question, i want to go back to the question that you put to joe. Because what youve got here and what josh is doing today and what i did with roku yesterday are individual stock stories i had a specific reason, its momentum trade thats lost momentum josh has specific reasons for twitter. There are fundamental very specific issues, jack dorsey moving to africa just being one. And what im driving at with this is as we look into 2020, we have to remember its going to be a collection of individual stock stories. So joe, to your point that were going to see the earnings come in, i think people are going to make individual stock decisions there. For instance, there may be sectors that benefit we may be looking at the financials in energy and say we see Earnings Growth. We may be looking at some of the more software oriented stocks which have fluttered a little bit and say the Earnings Growth isnt justifying the overall stock price. My point is this, but its really relevant here its not a stock market, its a market of stocks think about these individual decisions that are being made. Theyre individual decisions, but collectively what youre seeing is on the margins selling. Look, this is the final trading day of whats been a great year, a good decade, obviously. Whats going to be the defining story for stocks, do you think whats going to be the thing that you need to keep an eye on most, amy, for trying to figure out what stocks are going to do in the new year . You have to keep an eye on multiples and thats what everybody is so focused on earnings and thinking theyre just extrapolating that earnings are going to go up and the multiple is going to stay here i actually think if we get some momentum and the economy picks up, youre going to get a contraction in multiples and thats going to outweigh any benefit from e so were relatively cautious at this point, exactly the opposite position that we were at this time last year. Its been a multiple expansion story for this year. Theres a good debate within the market as to whether you can repeat that, whether you actually need some earnings to show up to justify where stocks are and where some people think they could go. We went from a tightening bias to an easing bias we cant do that again. You could stay easy. We could stay easy, but you have to look at the rate of change from tightening to easing if you stay easing, you dont get expansion, you get the multiples to stay where you are, which is fine. But that doesnt get you another 30 a year. Were only predicting 7 and i know some people are up to 10 Earnings Growth next year. There were people on squawk on the street this morning who said you are going to get zero. Its a valid point but lets just say its 7 and you get a multiple contraction, youre looking at an s p return of 3, 4, 5 percent i think thats the most likely scenario. If not, lower than that. Look, i raised the question yesterday of can you think of a period where earnings are so in question nobody seemingly has a great thought on where earnings are going to come in, and yet were talking about a stock market that is basically at alltime highs. If its zero percent next year and were looking at zero percent this year, you dont get a flat line earnings for three years and maintain an 18. 5 multiple thats not how it works. Last year we went down 20 in the month of december, which was anticipating flat Earnings Growth this year this year weve seen a run in the s p 500. In my opinion theres no question thats based on Earnings Growth in 2020. Zero percent, head for the hills, folks. 2019 to me, it was all about technology it was all about the performance. I cited this yesterday, 11 s p sectors, theres only two sectors that outperformed the s p. Its about technology and the tremendous pivot from the federal reserve. And i think thats emblematic. What outperformed the s p besides technology you dont necessarily have to say well, it outperformed the s p to have worked the s p in its own right was up pretty darn nicely. But i could buy an index fund then are you only going to buy Technology Stocks in 2020 . That is the contribution to why the s p is 30 higher. Youre only going to buy Technology Stocks in 2020 . No, im not going to buy Technology Stocks only in 2020, but Technology Stocks are going to provide for me the roadmap as to where the overall s p is going, as well as the federal reserve. 2019 was a cash flow story. Anybody who had strong cash flows did well the only way that the market looked at all relatively normally valued is on cash flow metrics. On any other metrics the market looks extremely expensive. That goes back to our earlier statement, it cant just be with services you like, it has to be with companies that are generating cap and making profit. Im most interested right now in the Energy Sector and the health care Sector Health care sector had some of the best Earnings Growth and yet under performed, up 19 year to date, versus an s p of closer to 30 . I think a lot of that had to do with concerns about the political situation, which historically has always been a wonderful opportunity to buy pharma it pretty much happens every four years or two years depending on how loud the rhetoric is politically about drug prices. The Health Care Sector is about a lot more than just drug prices, so i think there are a lot of companies in there that could work i think the sector by and large could work. I like where youre going with this. I feel as though we have now two differing views and opinions on where your money is going to be made in 2020 heres someone who says, you know what, it was all about technology this year and thats where the story is going to be its going to remain a technologydriven market, right . Josh takes a look at the laggards and says, you know what, maybe its energys time, maybe its health cares time. Maybe the best gains are the ones from the beaten down spaces that didnt perform as well. So energy is up 12 on the year and almost all of that is in the last two months last year was horrific as well its not just one year of lagging performance, its a decade in which 10,000 invested in the xle is now worth 10,300. You have made 0 for ten years that gets me interested. And ityou still have companies that are involved in Oil Field Services and drilling. Whether theres more drilling or less drilling, there is money to be made in a secreter thats underperformed to this extent, even if were talking about the component thats alternative energy, which this could be a decade of battery, battery and Energy Storage so im looking at that secreter. I bought some this morning, actually first time i bought the stock, probably in seven or eight years. Im getting a 5 dividend yield. The whole world is aware of what their issues are ill tell you this, though, the recovery in International Drilling is already into its second year, has very little to do with just shale were talking about around the world. And maintenance revenue will always be good even if new drilling projects arent so look, i think its going to be a 50 stock with a 5 dividend yield, it could be a 25 total return and the stock has done absolutely nothing for years. So i like this setup theres some big hedge funds buying it. Im looking in health care and energy because i think that could be where its going. The tech sector is up 50 this year there are no hidden gems in tech. Thats a really good point. Its a great point. Youre misunderstanding, i am saying that if technology does not perform, the s p is not going Higher Energy has the potential you didnt say that. Let me finish. Say it clearly now. I said it before, energy has the potential after a lost decade in which commodities were down the entire decade everyone is all excited about energy josh, a couple of years ago when you got out of the xle, you said ill never touch energy again i think were the words. I lied. In the last 30 days theres tremendous excitement surrounding energy there are a couple of names within energy that might work well and what that will lend itself to is high yield debt that will significantly outperform the equity if youre going to see the recovery in energy lets get Natural Gas Prices away from 2, which theyre flirting with right now. You dont need a recovery in energy you need a recovery in sentiment. You have a stock selling at 10 or 11 times earnings with a 3 to 5 yield. I could name 12 of those right now. You just need people to say there are dividends here, theres not too much debt, i think the cash flows are okay. And they could take the stock up 20 with no change whatsoever in the fundamentals. Youd has had a great year and the stocks by and large havent done anything. By the way, i have no call on oil. Howard marx likes to be say theres nothing intelligent to say about Energy Prices. So lets assume crude is just okay over the next couple of years. A sentiment shift for this segment of the market could take up the Higher Quality names. Would i screw around with the junk bond funded producer stocks, the small cap . I would not. So im looking at the bigger names and i think Conaco Phillips is interesting. Is it a year where you look for opportunities in things that underperformed or is it going to be a year where you just keep riding the momentum of where the big money has by and large been going . This is the conversation that were having. Im aligned with josh not only has health care been completely decimated and underperformed, but there have been amazing breakthroughs in health care that have gotten no press or reporting weve had our first trials and were curing diseases that were incurable for decades. And so there have been a huge amount of breakthroughs and we really like the Health Care Sector weve also closed our energy underweight and i think you just need a weaker dollar and a little inflation i think what these two guys are talking about its what your sniffing. Youre going to get energy to rerate and thats the difference between an energy call or a tech call. So i just want to go back a month ago. I was on you and jimmy cramer and i said that energy is going to do what financials did six months ago had been totally left for dead everybody hated it and now was its time the reason for that just to back up what everybody is saying, is that Capital Allocation has been rationalized in the energy match. Five years ago you had the start of the decline in Energy Prices and bankruptcies in private and Small Companies in the u. S that totally crushed sentiment, which has now been cleared up. But i dont think its just energy or Just Health Care as well i think financials continue. Look, it seems clear that the global slowdown in trade that happened in 2019 is over its starting to pick up again with that, you should see yields higher, and the surge in Money Center Banks should continue with slightly higher, slightly steeper yield curves so add financials to the list. But to joes point and to square the circle, that might mean its not a great market overall. If you do get the big cap stocks and the big tech of course, that goes without saying youre more than likely not going to have a great year in the market if the biggest secret doesnt have unless you have a massive rotation. But theres a natural bouyancy to tech its so weighted in apple, amazon, microsoft, in alphabet that the passive investing and people putting their money back into the markets, as money flows back into the markets the passive etfs are going to have to buy the Technology Stocks. Apple and microsoft accounted for 15 of the gains. And at least a good portion of that is eft buying. So this is really important you could have money coming back into stock mutual funds or etfs, money has never stopped coming in, but stock mutual funds, you could have that and not preserve the same top ten and the best evidence of that is ge was once in the top ten of stocks its lost like 180 billion in market cap so flow is coming back in. They didnt just prop it up because it was in the top ten. So you could have a rotation where money does come back and chase the market, but you end up with a different top ten at the end of the year and i think thats an important distinction. So we talked about the dollar, where they think its going, what it could mean to certain stocks it could certainly be a tail wind for some multi nationals. Contes Contessa Brewer is taking a look at which Companies Stand to benefit the most. The dollar has now hit a sixmonth low today. We took a look at companies in is s p 500 and 40 come from revenues from overseas so youre seeing a weakening dollar have more buying power for Companies Overseas amd gets 80 of its revenue and its up 57 over the last three months as we have seen the dollar declining apple up 30 , 58 of revenue coming in from overseas and microsoft which gets half of its revenue from aboard up 13 theres definitely a correlation here as weve seen the dollar weakening and these are companies that have mentioned currency as a big head wind. And then companies where this might be a concern, think walmart with big imports from overseas, home depot, which is down 6. 5 over the last three months and finally, we have seen a big hit from overseas tourism this year, especially from china. Part of it is the overhang from the trade war with china but also because of the slowing economy. Imagine that the dollar continues to decline 3 to 5 as a lot of big banks are predicting and youve got Chinese Tourists saying now i can afford more. This could be a big lift to Companies Like marriott or hilton, to mgm resorts, for instance you could see disney getting a lift because of parks and cruises and even the retailers because we know that when visitors come here, they spend money at tiffanys for instance. So we would be looking for those kinds of companies to get a real tailwind from a falling dollar. We appreciate the setup very much happy new year to you contessa lets kick around some of these names before we take a break pepsi, cocacola, kellogg, deer. What about caterpillar this is one that i think is going to have a lot of volatility in 2020 if you just look at the most recent two years, you wouldnt want to buy this however, if youre optimistic about the future, particularly optimistic about continuing clearing of trade tensions, then you want to own caterpillar. If you think the capex is going to pick up and companies are going to Start Building factories and governments are going to start spending on infrastructure again, these are big ifs but if thats true, caterpillar could get back to 180 next year. The other way to play this is buying stocks outside the u. S. And when the dollar weakens, the u. S. Multiple tends to go down and you tend to do better outside the u. S. So we havent been adding to the staples here, but we own nestle a and unilever. But if you do think theres going to be any kind of benefit from it i own International Stocks outright rather than look, youre going to have exposure to u. S. Multi nationals no matter what you do. Apple and microsoft are u. S. Multi nationals. Youre already going to have the exposure, the question is is there an opportunity that arises in International Stocks and how does the currency affect it . A strengthening euro historically has been good for International Stocks versus u. S. Stocks im not suggesting were definitely going into a stronger euro cycle, but look at the strength of it right now and thats with germany still having a negative interest rate. So imagine if europe gets their act together and we have positive rates and strengthen the banks in europe as a result of that, you could have a substantial International Blue chip stock trade work out in our favor. All right we will step away for a quick break. Heres what else is coming up on the Halftime Report. Announcer straight ahead, the unstoppable rally in semis, why one analyst is bumping his price target for in individunvd. Plus the invest committee is ready to answer your question and ask halftime to reach us, go to cnbc. Com halftime or tweet us. The Halftime Report is back in two minutes. upbeat music [narrator] at Southern New Hampshire university were committed to making college more accessible by making it more affordable. Thats why were keeping our tuition the same for all online and campus programs through the year 2021. [woman] i knew snhu was the place for me when i saw how affordable it was. I ran to my husband with my computer and i said, look we can do this [narrator] take advantage of some of the lowest online tuition rates in the nation. Find your degree at snhu. Edu. Some things are too important to do yourself. Get customized security with 24 7 monitoring from xfinity home. Awarded the best professionally installed system by cnet. Simple. Easy. Awesome. Call, click or visit a store today. Welcome back, everyone im sue herera here is your cnbc news update at this hour. A phone video believe to have been taken shows protesters at the embassy on baghdad u. S. Personnel are not currently being evacuated. U. S. Ambassador on personal travel is now returning to the embassy. The media gathered outside the bay route property after he fled campaign. Ghosn said he left japan to avoid injustice and political persecution over financial misconduct allegations Israels Supreme Court convened to hear a petition on whether an indicted member of parliament can form a new government it is a key test case for before Prime Minister netanyahu can prolong his political career after elections in march. And sonny mehta, who led the publisher for more than three decades, has died from pneumonia complications. He published prize winner literature by tony morris son and mccarthy and blockbusters such as 50 shades of gray and the girl with the dragon tattoo. He was 77 years old. You are up to date scott, ill send it back downtown to you. We appreciate that, sue herera thank you very much. Lets talk about nvidia. Got a street high price target today. Bench mark raises their target to 275. Theyre looking for a strong 2020 weve made it our call of the day. Josh brown yeah, theyre talking about 20 Revenue Growth and 34 Earnings Growth. The bears would probably say thats already in the stock, thats why its got the valuation it has im not so sure about that the semis got a big rating over the last few years in general and nvidia specifically. Then it crashed by 50 its been a long road back, but its almost recovered twothirds of what its lost and i think if they can deliver numbers that look anything like that, theres no reason to think this couldnt be at an alltime high ive been in the stock since 2015 the Research Supports my prior bias and thats it for me. Weve been trimming weve owned it since 2014, so weve done well with the stock its been a great position for us we like the stock a lot. And we think that it has a Great Technology and a lot of growth, but 50 , the revenue from gaming, thats not going to grow anywhere near the levels that st other parts of the business are going to grow at so we think its relatively close to fairly valued we have huge gains in it so well continue to hold it but probably not adding at this point. So look, on nvidia or any chip stock, before you make a decision, you have to make a decision on the Semiconductor Sector its up 60 this year. Weve got a lot of good news phased in. Youve got the u. S. Trade deal about to be signed so decide how you want to play the semiconductors i think for the long run theyre fine but i dont want to be very high beta in it i look at nvidia and i see a beta of two. If i really thought the chips were undervalued, i would like nvidia or amd, which was a date ta of three. Now, right now i think the chips are ahead of themselves. Thats why i favor in intel. Its got a beta of one the nice thing about the chip sector, youve got so many ways to play it. So jims point, this analyst in particular is talking about 7 in earnings and a 38 multiple on calendar 2020 to get to his price target. Youve got to be bullish on the secreter. You have to be wildly bullish. How can you trust that youre not going to endure another crash . You cant. So to jimmys point, there are other places in the semis that you could potentially go. This is a question of portfolio construction, so now you say to yourself, most of my portfolio does not trade at a beta of two times the volatility most of the things im invested in are not going to do anything near what nvidia could do to the upside if i end up being right on the trade then you say how does Something Like this act alongside a holding in verizon or a holding, and so thats the way im looking at it. This is without a doubt one of the highrisk portions of my portfolio. So not every decision that you make as an investor is predicated solely on an absolute basis of one name. A lot of times youre looking at a portfolio in totality and youre saying, what role does nvidia play. So for me i dont really own a lot of stocks like this. But i get your point of view as well options bulls are betting on a consumer stock Pete Najarian is going to join us with that and more. Lets give you a check on the s p sectors right now. Its another down day for stocks overall. S p is off by just about four points energy, materials in the green rba redng else in the r wee ckight after this. Here we are in the cnbc control room this is where it all comes in, including and especially your questions. Go to cnbc. Com halftime, ask us a question and well answer it on the air announcer go to cnbc. Com halftime or get us on twitter with the hashtag ask halftime. General mills is having a big year shares are up about 36 . That puts it on pace for its best year since 1991 Pete Najarian is tracking unusual options activity in this name, not only because its based in minneapolis where he joins us from right now. Pete good to see you yeah, general mills, this hit a couple of weeks ago as well, and when it hit the previous time i decided to buy the stock itself because i was waiting for an excuse to buy it it made a lot of the move that youre talking about, the 36 . A lot of that was in the first half of the year its been flat lining ever since. But great performance this year. What theyre doing today is pretty interesting we have two different ways that theyre trying to approach this. Theyre buying the just in the money calls, the february 52. 5 calls. Bought about 2,000 of those today with the stock trading about 53 a share. On top of that, she also bought the 55 strike calls. We call this a call stupid because youre buying and buying usually when we see something we call it a spread thats not whats happening here theyre buying and buying. So i like the bullishness of what were seeing, both in february, so were buying a little bit of time as well its not ultra shortterm like so many of the other trades weve seen so i like what were seeing so i own the stock and now the calls. I bought the 55s, not the 52. 5 so ill be in there for the next call in two months this is a name that never hits but we talk about energy names all the time ma gellen, were going out to february this is a stock that did not perform very well this past year, but maybe in this coming year, 2020, were going to see some of that theyre buying the february 65 strike calls and buying those very aggressively. And the interesting thing is theyve bought about 4,600 of those today. They bought 4,000 of those exact same calls yesterday as well. So its great to see this one day after the other. Weve seen this time and time again this past year where theyre hitting, hitting this one hit yesterday and hit today. I like what were seeing i bought these calls so im not in the stock but i did buy these calls. Theyre about 50 cents gives you an opportunity for the upside ill be in there one probably about two months as well. Good stuff. Happy new year to you and your family, pete we will see you on the other side and look forward to that. I appreciate it by the way, congratulations to you as well. Ronry vera is going to be a great coach for your redskins. Im excited as well straight ahead, desperate to answer your questions on uber, ford, rer viezverizon and more back in two minutes. Self all lo. I wake up every morning to see how much weight ive lost and how much better i look. Myww join for free lose 10 lbs. On us. Were committed to making college more affordable. , thats why were keeping our tuition the same through the year 2021. [woman] i knew snhu was the place for me when i saw how affordable it was. [narrator] find your degree at snhu. Edu. Beyond the routine checkups. Beyond the notsoroutine cases. Comcast business is helping doctors provide care in whole new ways. All working with a new generation of technologies powered by our gigspeed network. Because beyond technology. There is human ingenuity. Every day, comcast business is helping businesses go beyond the expected. To do the extraordinary. Take your business beyond. Bull run over the last ten years, Technology Stocks led the way. According to our data partners, the s p tech sector had a 333 cumulative return. For more, go to cnbc. Com kensho. Lets do this lets answer some of your questions on new years eve. From erin in ithaca, new york. Levi, buy or stay away bought it in the middle of december difficult to find a specialty apparel play it came out very strong, the Company Actually makes money your expectation here is that you will see mid to high single digit Revenue Growth, mid to high double digit eps growth i know matt likes it as well its a name im going to hold into the new year. Josh, is uber a good investment now no. I bought it as a trade i dont think its a good investment it could be a very long time before it manifests itself into anything that you could call investable i dont think there will be profitable until probably 2021 at the earliest. However, i do think the mid november low, there was a chance that that ends up being the low. Thats where my stop is. I have a very defined risk here. Im in small and im not a believer yet but i do think some of the pressure is coming off and well see if im right. To you, jim, from gabriel in philadelphia, pennsylvania is ford due for a comeback in 2020 im going to change the wording. Its due for a continued rebound because 2019 wasnt bad. 2020 should continue the trend both for ford and gm why . Because if you go back four years ago we were worried about peak auto. We talked about it on the desk a lot. It didnt peak, it plateaued north American Auto sales right around 17 million for the last several years. Thats good Profit Growth as they continue to cut costs and build cars and trucks that people want. Its going to increase pickup sales where the bulk of profits are made so both ford and gm. I like them for 2020. Been hearing mixed opinions on verizon, would you be a buyer or seller . We like verizon a lot its a relatively large weight in our portfolios. Low single digit growth but steady growth. Very attractively priced at 12 to 13 times earnings only 30 of the analysts that cover it are rating to buy it. We like the partnership with disney and we think theyre doing smart things so we like verizon. Thank you so much for the questions. Coming up, Morgan Stanleys new price target on walmart. First, joe kernen has a look at whats coming up on the exchange. It doesnt get any better than this. I feel like i have detention im very happy you got the reward, not detention. Reward, youre right. Thats the half empty, half full viewpoint. Although it is new years eve, scott. So youll be out of there in an hour. Big deal. Thats right. They had the new years celebration in sydney this morning and i was thinking its like midnight. Anyway, no, no a look at where you can still make money from the markets at alltime highs one of the biggest Auto Executives in history, this is bizarre, is on the run in a cello case well have the latest on charles ghosn. And chipotle shares have been on fire how it sets up the company for next year, that and more ahead the exchange. The Halftime Report is back after this announcer ask halftime is sponsored by interactive brokers, minimize your cost to maximize your return walmart is under some pressure today the stock, though, getting a big call from Morgan Stanley they raised their bull target 180 a share do you still own it . I 180, wow. Im not sure it gets to 180 prior target was 130 180 would be quite a reach that would be a significant change in the business model, and we would have to see an acceleration in Revenue Growth like walmart really has never experienced. It fits well with josh was talking before about a portfolio. I have tried monster beverage. I have tried jm smucker and the consumer staple space. Walmart offers you significant exposure to the s p as a consumer staple with over 1 waiting in the s p maybe Procter Gamble could bi you more its almost a little defensive, too. I feel as going into 2020, that works. Im not in walmart. I was in it, i got out early i dont know what im doing. Heres what you have to believe on walmart to get to 180. Look at threeyear median price earns ratio for walmart. For the last ten years up until a year ago, it was somewhere between 12 and 15 times. Thats the median pe its 27 times right now. So you have to decide that the valuation the stock traded at for 8 of the last 10 years was ludicrously low, and now everything is different. Thats what you had to have gotten right when the stock first broke out a couple years ago, right after they bought jet and demonstrated to the world how serious they were about competing online you have to increasingly believe that because that number is racing higher and higher the peak multiple walmart ever sold at was the year 2000. It was 40 times earnings you didnt make money in the stock for 15 years afterward if you bought it at that valueeration walmart was easier at 70, 80, 90. Its getting harder. I love everything the company is doing, but thats why im not buying back into it. You own it . I dont you havent owned it . I havent owned it for long time i agree. The world is still moving away from walmart its getting a pounce, a recovery from lowincome consumers doing relatively well. A lot of risks have dissipated but now theres a lot priced in. Its hard to make the case walmart over target, isnt it . Given that target is up 100 this year. Unless you think the laggard is going to compete this year the money flow has been towards target, best buy, costco yeah, ive got to say as i listen to us talk about this, i dont see anything wrong with walmart. Im not going to compare it to target because they face the issues the multiples are high. I dont know how much we expect Consumer Spending to go up from here, and they both have good online presences which is what you need to survive. I look at them both and i see this is going to do what the market is going to do. Im totally neutral on them. I would rather own a spider than either one of them im going to correct something as well. The price target is 130 thats the base case. Oh, they gave you an upside case also. But you know. 130 is more reasonable well take that not as exciting maybe not just wanted to make sure, base case is 130 well do final trade straight ahead. Is this years best dow performer setting up for a big fall one top tech trader has a warning for apple investors. Find out more by reading the article at tradingnation. Cnbc. Com or the famed peaks of whistler, youve faced the hassle of lugging your gear through the airport. With ship skis, youre just a few clicks away from having your skis, snowboard and luggage shipped from your doorstep to your destination. With unrivaled pricing, real time tracking ship skis delivers, hassle free. Ship ahead and go catch those first tracks on fresh snow. Ship skis. Your skis. Delivered. [spokesman] if youve tried colleg group cheering shed, snhu lets you transfer up to 90 credits toward you bachelors degree. [woman] it doesnt matter how old you are, you can do it, you can finish. [spokesman] finish your degree at snhu. Edu welcome back want to talk about one of joshs new blog posts its titled two investment tricks you can use in 2020 do tell. If you read all of the nobel caliber research, most of the returns investors will own will be behavial, not stock selections security selection two things i like to do, i catalog all of the things i was worried about or people were worried about throughout the course of 2019 and i say them and then i say, but i invested anyway. For example, the trade war, but i invested anyway. A 60 40 portfolio gave you a 20 return this year despite every potential negative thing that could have happened. Doesnt work out so well every year, but its important to remind yourself, you behaved well and you earned that return. The second thing i like to do, this one is a little trickier. I dont think that well be right to expect returns this good in followon years so i try to save more money, invest more money, as though i know for a fact the return will be lower. Those are my two tricks. Read my blog give me a name. Schlumberger. Kender morgan, good yield philips 66. Happy new year, everybody happy new year to everybody out there as well. Look forward to being with you in 2020. The exchange with joe begins now. Thanks, scott happy new year heres whats ahead. 2019 was the year that the bulls really took charge with the market sitting a series of alltime highs, but what do you buy now at these lofty levels we have names. Plus, from paying College Athletes to online gambling, to media rights, media rights, not meteorites almost the same. And my four picks for today in the bulls. Im going to give you those. Well look at what 2020 can bring in the sports world. And uber sues california burritos ruled in 2019, and commodities made a comeback, but we b