Debut four months ago. Who is this . Why are they so . Why so many questionmarks on the graphics we find out the answer to all of those. Riddler. Exactly lets start the program with the big stock story and market story really of the day. And that is apple. A stark warning on revenue gue are due to the impact of what else, the coronavirus. The iphone manufacturer tumbling today but finishing well off lows go to josh liptak. With more on what apple said and the reaction josh. Thats right, brian apple finished in the red today but maybe not hit as hard as some expect. Many analysts weighing in and concluding its a shortterm challenge. Meaning they think the demand for apple products simply shifts from the march quarter to future quarters there is still a lot of uncertainty and questions. How long does in outbreak really continue how long before chinese consumers feel its safe to go back out and shop . Remember apples only has 7 out of 42 stores reopening even those with limited hours appear and when will the manufacturing facilities rarp up this is the second tielk they cut guidesens. Back lack last january they did the same but investors piled into the name betting on the stock surging more than 100 of course its no just apple Many Companies depend on china as a ski Consumer Market and Critical Link in the supply chains there are other companies expose ds for the 8 30 break. Hp, tesla, dell and hpe. What about apples big rival samsung . Tech analyst Patrick Morehead at sources saying its not completely insulated either. Back to you guys josh lipton thank you very much all right. So we know the stock fell. But lets be clear. Apple is still up nearly 9 this Year Coronavirus has been going on the better part of a month do you take any comfort or solace in the way it traded. You have to if you said to me whats apple going to do on tuesday with the news i would say down 5. 5, 6 . Broader market down. Here we are stock not even down 2 maybe you say the supplier gets whacked. Could have beeno downtown 2 sky works almost 50 of the revenue from apple down 1. 5 or 2 these are minor moves given the huge run the stocks had but the Broader Market you have to be encouraged. Quickly ill say this. I still think 280 is a level that apple needs to revisit given whats going on in the world and the potential for the selloff in the Broader Market. But just today you have to be very encouraged by the price. Bad news good price action. Its the trader saw. Thats when you want to buy. If you have aggressive trader buy apple today, use the low as the stopout point. If youre not aggressive wait for the breakout but this tells you the psychology of the market is right now. Which is, okay, coronavirus bad, but its likely a temporary phenomenon and these it means that earnings will be pushed to the next quarter to the next quarter. After that and so investors say i dont want to sell and add into that every central bank in the world is opening up liquidity spicket et cetera. Begin had combine those two coronavirus plus liquidity thats why the market is staying elevated. I have to say hold hon a second, because i agree with everything you whys said when you consider we do this all the time its 11. 5 of the triple qfxlk between moikts and apple you have 30 the dynamic here is apple more than most Tech Companies its a greater percentage of revenues interest Greater China mainland, hong kong, taiwan. If you think about the quarter giving everyone the reason to bang the table or be emphatic about apple. You had 14. 8 of revenue from china. And the previous four fisk quarters it had been down. And i realize you guys are talking about market dynamics. They couldnt be clearer i think youre right i do think we have to think about apple. And i do think apple the next few quarters there is a hangover from this. Even if the coronavirus ended tomorrow which its not going to. I hear what youre saying but i have to say i dont fully agree. I think a lot of the apple story is 5g, right and i dont think the coronavirus really changes 5g at all. I think it was the latter half of the year story to start to me its not surprising that apple announced they would miss. It would have been shocking had they announced they werent. Right. The part that was more impressive to me was you brought up the smh that was a really. Semiconductors. By the way, the nasdaq 100 finished higher today. Yeah, up. Which is comforting a bit given your point, tim. I beat that dead horse a bit, which is the weighting of apple. And. The nasdaq went down fractionally but went up. Its extraordinary. To be clear also, the the Platform Companies and big cap and megacap tech are outperforming. The rest of tech is not. If you look at what apple is as far as im concerned its a Platform Company even though a Hardware Company were pushing the Company Higher on 5g and services but i do think you have to be somewhat wary about liquidity dynamics and passive investing works until it doesnt this is a number that everybody said bottom up investors would be nothing down after a record run. By any measures of the company its a record run since june of last year. You cant say in one day of trading no big deal. Its interesting, brian, you use the worded comforting. I could push become and take the other say and say its disconcerting the market doesnt react to any bad news what so far. Tim alluded to it in terms of passive investor markets go up every day regardless until they dont. The longer the markets look past the bad news we have seen i think the more worried you should be. Im pushing back on your pushback. Im pushing back on the push back on the push back. Someone is falling over. Exactly if you need one of these im holding the iphone for everybody on the radio. Ill push you back. If you need one, youre going to get it. I understand. You may not get this quarter maybe not the Second Quarter but if you need a phone or computer where arpds youre going to get them. Maybe the market realizeds the Fourth Quarter is not good but everybody already said the ignore the First Quarter universally when the numbers come out we have 173 i thinken i heard on cnbc this morning companies reference coronavirus already. Maybe they have a monster quarter. You push back on him but sounded like you were on the same side. Because he he said he didnt finding comforting because the price action didnt work i thought maybe the market thinks as opposed to selling 15 million iphones this quarter im making that up theyll sell 30 million next quarter. Im looking at a broader not necessarily apple spsk but the fact gnat looks past any semblance of bad news. And you use the word need. Nobody needs the phones. Im hard pressed to find a person on the planet needing it. We want them you talk to the strength of the consumer again im not certain never underestimate the consumer want to spend should they spend is a big are problem. You guys and girls should apply this to the entire market then because in fact youre making this case that apple maybe youre not that apple is separate from the rest of the pack because every other day talking about coronavirus unless we think is didnt matter brians argument you delay the purchase but you buy the phone is same for thinking same thing about casino. Casino you lose you bet every day. You dont go back and eat in time. Right, but it goes back to whether or not you thichlg this is a temporary disruption or think that this is something larger and so if you are in the campana you think this is something larger and the economy the Global Economy was weak already. Youre the panelist youre supposed to answer not ask. Answer the question. My point was the same point at the top of the show, buy apple and buy the market until proven otherwise we can get to bubbles and crazy valuations thats my point if everyone turns on the psi et. Look at europe, the German Economy is terrible. No physical fiscal stim lap they have to print more china the same most of Southeast Asia will likely do that thats spilling into stocks in a direct and indirect way. So until that dynamic stops i want really hard to say that the fundamentals matters. Good discussion there on apple. Now to stock number two and a company big are than apple in terms of sales, and another dow component, walmart. The company posting the biggest miss since 2015. The Stock Department react what gives Courtney Reagan is here now . How many times you been at the nasdaq. Twice today. Twice with a little Stock Exchange in between, you know, hitting the hot spots. Youve been on seymour city glad to see you. Great interview with the ceo today. Whats the take away after the day you heard from. The take away is the longterm strategy that walmart laid out is intact sfiet the weakness of the Fourth Quarter yeah category weaker than walmart planned during the holidays but its not signal of fundamental shift in anything like Consumer Spending or walmart strategy of blend being digital and physical together. Plus the stock didnt get shocked with Coronavirus Impact like youve been talking about because the 400 plus stores in china remain open. Some of the sales are tight tighter and sales more towards food there could be a margin hit. Deliveries are still happening on the supply chain side there hasnt been big impact so far. Here is what the ceo told me that in the u. S. About two thirds of what we sell is made in the usa the other third doesnt come from china and weve been acting to buy goods already here made in the u. S. Usa in the country to offset some of the things that we might otherwise feel pressure from. Its too difficult to call right now exactly what happens in the quarter. But we said because of whats happening on the ground in china, our Chinese Business not the rest of the world. We expect to have impact but not putting that under guide zbloons not in the guidance so far in the u. S. Comparable sales grew under 2 . Below expectations but thats a comp most retailers pining for right now plu plus its a continuation of multiyear growth trend for u. S. Sales. Digital sales grew 35 on the quarter. Today u. S. Commerce said the ecommerce will near 50 billion the first time a number like that walmart he iss Online Business has been becoming sizable through organize igic growth and acquisitions amazon struged with grocery. Thats walmarts strength in store with and with the growing Online Grocery business. Its fascinating talking about the two players. They have different strengths and weaknesses and if you look at total revenue, walmart is ea way bigger than amazon. Its amazing. Courtney reagan i heard cramer talk about it everyone is piling on the actual number but ecommerce up 30 . Incredible number. It is its expensive revenue for them, right. Thats the margin issue they weigh as they build the business here is the thing im sort of maybe you can answer. Yeah. A lot of retailers talked about the short are christmas, which everyone knew. Right be exactly. Quite some time, right. Totally. Was walmart already fully the stock discounting even if the estimates didnt come down because they you know same thing . After target. I think so. When we heard from target i think it was a shock because they were the first big box numbers to give numbers and walmart never broke out the holiday sales. They wont even detail a big day like black friday or cybermonday other than saying the season was strong with weak points. But walmart was weak in apparel but thats walmart strong target weak in electronics wlormt strong. I dont know if you kaunto count that as a category because there was so much focused on the go forward story we moved past it a bit to the previous point about the expense of online growth, walmart did say they expect the online losses to either be flat to this year or slightly lower and so i think that was something that was sort of a bit of a relief to a number of shareholders even if theyre what changing the Digital Strategy and how they go about it because they went through the period of acquisitions they are not doing that so much right now. That was a genius acquisition of jet you talked with mark lorie. Right. And my wife worked in retail and Consumer Products and still does 20 some yeerps. Brick and mortar retailing from management and ecommerce but the management is totally different. They are learning and they bought that knowledge. They did. I think that is what investors have become comfortable with is the risks that walmart is taking they are smart risks and not not too damaging if it doesnt work just like the jet black got a lot of headlines when yet only operated for a couple years. Only in new york and now its shuttering but doug the ceo told me we learned about commerce we knew it was a high touch business always hard to scheme we needed to experiment with it and figured out a lot of learnings to check the becomes thats not failure and we know a lot of the things are going to stumble as longs as we dont repeat the mistakes and not too expensive. Lucky to have kourtney here breaking the down the retail this is the concerns with walmart one concern there a while. Valuations trading close to 23 times next year numbers. Bug market multiple. In terms of the Broader Market and historically expensive the other thing that a huge inventory build year over year maybe they are anticipating something. I dont know but if they dont see the backin end demand marjs will be crushed. I would beconcerned. I think courtney also hit on what to me is the key point. Everything we just said is about a company its about the multiple you are willing to pay in any company we are willing to pay a higher multiple for walmart. Not amazon multiple but not a walmart ofiester year 30 where losses were either flat or lower losses on the business that gets them that multiple is so much more important right now. And so walmart has gotten back to competing on price which they can destroy everybody. And it means its less important about the margins. Its sound being like amazon be docent it. This is about multiple and what youre willing to pay for multiple its clear investors are paying more. Isnt it clear that walmart is the underdog in this story. Walmart have to fight and scrap right. Moving to the big retail story and courtney please we beg stick around macys dage a deep dive after the Credit Rating turned to junk the records may come up short. Down 35 on the year karen finerman, the market cap is now under 5 billion. Any reason to own ms. Acys. I dont own it that might be the reason there is a disconnect. They dont have a debt problem in the nearterm whats astounding and has been for a while is this is a company that bay pays a dividend of 9 plus that is a giant disconnect i mean maybe they should cut the dividend buy back their own debt i dont we just talked to the ceo of macys i asked that question are you going to keep the dividend and he said yes they are keeping the dividend not cutting there is no change to the strategy and talking about the bigger shift on the polaris strategy which s p says might be the right thing but its in a tough sector and that seems to be a bigger reason for the downgrade but not the debt but i agree its confusing whats going on. Look at the debt, the debt looks to be about 5 billion and the market cap and debt are the same. Theyve paid down 3. 5 billion in debt the last four years. They have a decent cash flow this is serious. Its always the bull case is the real estate. Yes. Everyone says they own the real estate. So with sears. Yes. It was a good theory. Im saying its not a bull case i deserved that by the way. Karen is not espousing buying companies for a dividend yield because she doesnt. Right. And the 9 dividend yield you can lose half easily in miss on any given day because thats the volatility in the stock. Its not debt issue its same store sales growth issue and it has none its a contracting top line. I think the company is interesting here i think todays announcement is a nonevent on some level looking at the stock, nothing new happened today. The one thing about macys i think about is we see the Department Store sector shrink over time in the number of players and stores themds. We looked at best buy and thought why do we need consumer electrics. We have amazon buy it online but best buy figured out a way to come out stoerng stronger and wonder. I wonder is it possible we have room for maybe one Department Store, even if it looks very different than today and could could that macys. You cot to got to stop show rooming at best buy. You know melissa mel goes with the notebook and takes notes look at everything then goes home and she is watching right now. Does all her homework always. You just show room the undergarments. No comment. The group on pilen. Crashing 20 we tell you why. What in the world is going on with gold . Good question for guy. Soaring again, 7year highs. Is it telling us to be nervous catch us live retroactive willen oh on the go on the cnbc app, live from new yorks times square stick arnd ou when you look at the Critical Issues facing our world, what do you see . Ou we see breakthrough medicines getting to patients in record time. We see harnessing natural gas unleashing the promise of clean energy. We see engineers simulating the future to improve today. At emerson, when issues become inspiration, focusing core strengths to create a better world isnt just a result, its a responsibility. Emerson. Consider it solved. I am totally blind. And non24 can make me show up too early. Or too late. Or make me feel like im not really there. Talk to your doctor, and call 8442342424. [ fastpaced drumming ] all right welcome back we are making a prediction groupon will be the disaster du jour tomorrow. Shares crashing 25. 5 tomorrow and groupon says it will exit the goods business rahel solomon back with more. Yes, a