Trade War Tit-For-Tat 2/4/25
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I'm Scott Wapner, and you're listening to CNBC's Halftime Report, the podcast, the most profitable hour of the trading day. We record this live weekdays at 12 Eastern. Listen in.

Thank you, Carl and Sarah. Welcome to the Halftime Report. I am Frank Holland in for Scott Wapner. Front and center this hour, navigating the uncertainty as we continue to see this trade war tit for tat. And we have more big tech earnings that are looming large. Our investment committee is standing by to break down what's at stake for the markets and for your money. Joining me for the hour, we have Josh Brown.

Stephanie Link, Brian Belsky and Jason Snipe. But first, a quick check on the markets. Taking a look at the Dow, what fraction right now? The S&P up over a half a percent. The Nasdaq, the best performer, up about one and a quarter percent. Palantir, a big reason for that action that we're seeing. As Carl and Sarah just mentioned, tech does appear to be coming back. We do have big tech earnings coming up after the bell.

I think we got to get started with the fact that President Trump's going to be talking to President Xi at some point later today, according to the White House. The markets are moving higher on the idea that we saw a pause in tariffs in Mexico, a pause in tariffs in Canada. And even though China instituted their tariffs today, that there could be another pause is the idea of more trade tension. Is that priced into this market?

Well, look, there's a lot of unknowns, right? And if you look at the initial tariffs that came out, 25% in Mexico, 25% in Canada, 10% in China, that would have hit revenues for the S&P 500 7%, earning something like 5% to 7%, give or take a percentage point, whatever. Manageable in my mind.

Now it doesn't look likely. So, okay, so maybe we walk that back a little bit and then I would just say, we have no idea what's gonna happen. It's out of our control, but what we can control is the fundamentals and watching fundamentals of companies and watching earnings. And the good news is, Frank, that it is earnings season. We're right in the thick of it, right? And earnings are actually pretty good. They're running about 11%

for the quarter there in terms of earnings revenues are running at about 5 percent but the real surprise is margins margins are going higher and that's what I've been talking about so far for this year I think that's a big theme if you look across a lot of different companies the margins are really dictating the share prices too and the reaction so if you look at

Apple, Meta, Microsoft, we know those have great strong margins. But you had GE, you had GE, Vernova, you had Eaton, IBM, many companies that have reported so far that have seen margin expansion. And that is really important. And then I would also say, back to the tariff situation, the economy right now, the Atlanta Fed tracker came out yesterday, almost fell off my chair. It was 3.9% for the current quarter. The economy is running strong. So we don't like

tariffs. It's a lot of uncertainties, but I think we can handle it because the economy is very strong and it's led by the consumer, by income, by savings, by spending. The ISM manufacturing yesterday best in 26 months and it's now an expansion. ISM services has been in expansion for two years. So we can handle it.

It's leading to better earnings, as I mentioned, and that's what I'm kind of focused on. We do have to get back to the tariffs for a second. So you're saying 6%, 7% that seems manageable. Yesterday, we had an estimate that tariffs would be about an 8% hit on S&P 500 EPS. Today, we have Barclays coming out saying, in part, we estimate that this latest tariff announcement would amount to a low single-digit drag on S&P 500 EPS if implemented and not rolled back this year. Josh Brown, I'm going to come over to you.

What do you think? Do you think this potential hit on S&P earnings, is this manageable at low single digits, high single digits? And what do you think about the idea of a Trump and Xi meeting later today? Is there a risk for more volatility out of this meeting? The benefit of having lived through this already is that there are takeaways.

The first takeaway is that these headlines, while they will produce day-to-day volatility, in actual fact, do not lead to a more volatile atmosphere than usual. As a matter of fact, and not a lot of people notice, the VIX was structurally higher during the Biden presidency than it was during the Trump presidency. So that's not going to be a

day-to-day phenomenon on any given day you might have the market lurch this way or that because president Xi has a beautiful call with Donald Trump and it was a perfect call that might be good and then maybe he argues with the woman from Mexico and you know that's bad but like if you're a long-term investor you already know you could you could safely tune all of this out

If you're a short-term trader and you want to like play the tariffs, nothing I say is going to be relevant to you. You can tune me out. So I talk to long-term investors. I talk to people that are focused on the reasons why they're investing. I don't talk to people who are delusional enough to think that they can read the minds of world leaders and try to divine like buy and sell orders as a result of that.

Jason Snipe, I want to get your take on this. Are you concerned about more volatility? You know, Josh just mentioned that during the Biden administration, we saw more volatility than the Trump administration or Trump 1.0, I should say. But, you know, Monday, we saw a deep sell off on the idea that these tariffs would come into place. We saw China retaliate today. The futures were lower. Obviously, the markets rebounded. Is there just risk in this market with the idea that this call might not be beautiful, as Josh said it?

Yeah, no, I think obviously we have seen the first in the last couple of weeks, right? We saw the news from deep seek and we saw a lot of volatility over that. It was kind of shoot first, ask questions later. The tariff talk, which has been not necessarily pricing the market, but we've known a lot about this. And now, you know, we have conversations on Monday and then now there's 30 day delays. We do know that these are negotiable tools, right? So at the end of the day,

we don't pay too much attention to, we understand the potential impact it does have on earnings. But to Steffi's point on a lot of the pieces that she mentioned earlier,

Services ISM will get that in the expansion territory, as she mentioned. That manufacturing number was very positive for the markets. And then I look at some of the mean reversion trades. Healthcare up 7% year-to-date. The RRSP, equal weight, doing better than it did last year to start the year. So there are a lot of things to like. And earnings growth.

to Steffi's point as well, in double-digit territories. And I think about other areas of the market that are starting to grow. So for me, I like what I'm seeing thus far in earnings season. We're getting the report cards. We're seeing what fourth quarter heads look like, which has been abundantly positive. And that's why I continue to take bullish markets.

market brian coming over to you uh you live down in florida part of the year by what some people would call the gulf of america are you worried at all about these this trade war the trade tip or tat whatever we want to call it but specifically tied to this uh president xi and president trump talking later today according to the white house and what might come out of that whether it's what the president says or other actions between the two nations

Well Frank, first of all, thanks for having us. We really appreciate it. You know, as part of our job, we not only have a U.S. strategy product, but we also have a Canadian strategy product, and then we run portfolios. So let's focus on the Canadian strategy product. Late on Sunday night, I was up writing a note,

to go out to all of our clients around the world. And I think it really focused on, I know it really focused on control what you could control. We want to be known as the voice of reason and not be reactive. I think the one thing that Stephanie talked about absolutely positively has to be dug into a little bit more. As strategist for 35 years, I have a discipline and a process. So you look at valuation, growth,

operating performance and price performance. We do it for the markets and for our portfolios. So where am I going with this? If you take a look at the operating performance of companies, whether that's return on invested capital, return on assets, return on equity, and then also layer in some things from the income statement, including margins, these companies in the United States look amazing. So what does that mean for Canada? Our note to our Canadian clients and our global clients is this.

Focus on quality, focus on cash flow, focus on discernibility of earnings. When you do that, you will find companies that will, can, will and should, quote unquote, I said in the report, outperform Canada's volatility around the world when you default to fundamental metrics like that. I know it's really difficult. I know that we're in a binary buy-sell type of market trying to create opportunities. But when you stick to a discipline and a process, Frank, that's how you dilute all

of these types of volatile moves all right so with that in mind brian i want to show you guys a chart this is the pvh chart over the last week uh you're going to see a noticeable move when it comes to that pvh chart a big dip pvh is facing some issues in china right now separate from the tariffs according to the chinese government it's a separate issue they say it really has to do with sourcing we're not going to get into the weeds of it but when you look at pvh is that the risk that we have to worry about when it comes to a lot of companies especially when it comes to the us and china

that there might be issues that come up with our companies or U.S. companies that are, quote unquote, not related to the tariffs, but potentially related to these trade tensions. Steph, I just saw you nod. Well, I mean, I'm

I think we just spent the last five years getting out of China. U.S. companies leaving China, coming here, onshoring, reshoring. We talk about that all the time. They did go to Mexico as well. So there is that risk. But they're also going to India. It's one of my favorite places to invest internationally because they're going to be a huge beneficiary.

But they're going all over the world. So I think companies have a lot less exposure to China. Sure, there's headline risk like the PBH, as you mentioned. Stock's barely down though, Frank, right? So to me, yeah, there could be headline risk. But if the fundamentals of the companies are strong, and to Brian's point, the growth is there, and again, the margin stories are there, that's when you get an opportunity, right? You want to be buying some of these headline risks if the fundamentals are strong.

Agree, Brian? Agree, Jason? Hey, first of all, with respect to PVH, you have to kind of take two steps back.

two steps back, I'm sorry, and think about operationally. Are they making some operational risks? Are they making some, they made some bets that did not go the right way. So that could potentially provide some opportunity as they kind of clean these things out. But at the end of the day, it really does come down to thematically and where they're operating and if they're making money and what kind of product that they have. And I think some of that is what's the headwinds with respect to PVH right now. So Josh, coming over to you, I just heard you suddenly get a thought about PVH and just some of this headline risk.

I've been working on Wall Street for 25 years. I don't even know what PBH is. I want to make the point that the Chinese stock market has been closed for Chinese New Year. It'll reopen. The best proxy we have for how nonsensical this whole conversation is, is the fact that the FXI and K-Web are both trading up between 3% and 4% right now. So that gives you some sense of where risk appetite is for when those markets reopen.

FXI is really interesting. It's a BlackRock product, and effectively, what it does is it owns the H shares. These are mainland Chinese companies with tickers that trade in Hong Kong. This is indicative of...

a situation where everyone around the world now understands that this is a reality show. The intention of announcing tariffs is to hold the news cycle in the palm of his hand and none of this stuff is new. There's a New York Times article from six years ago talking about this moment in 1988 where Trump was outbid way before politics

for a piano that was used in the movie Casablanca, and he was so mad that the bidder was Japanese that he went on TV with Diane Sawyer and said, "We have to do tariffs. "These countries don't respect us. "We need to tariff, we need to tariff." This is 40 years of the same rant.

So maybe it works, maybe it's great, maybe it's beautiful. If you're an investor and you're throwing out, to Brian Belsky's point, you're gonna throw out high quality cashflow generating companies because of a tweet, maybe it's a good sign that you need to turn over your portfolio management to a professional and turn off the news. - Frank, there were speculation that we would put 30 to 60% tariffs on China. So when it first came out and I saw that it was 10, I was like,

Wow, that's way better than I thought. That's probably why the FXI is actually rallying at this point. Yeah, just to put a button on it, Josh, PVH is the parent company of Calvin Klein, Tommy Holt figures. So brands, you know, you may not have heard of the stock. Frank clearly knows. Let me write that down.

Josh gets a little snarky when he's away from the desk. Moving on. Some big earnings coming up. Obviously, Alphabet. I want to get everybody's take on what you're expecting from this. Obviously, we're just a week or so removed from DeepSeek. A lot of concerns about AI infrastructure companies, Google, Google Cloud Services. Certainly one of the bigger ones. Brian, I just saw you nodding.

Yeah, I mean, we made a big bet in Alphabet last year when it was down. We added to it, and we don't own any Meta. And, you know, Meta was a big darling, and we think Google's underperformance or Alphabet's underperformance really gave us a great opportunity. I think if you look at the majority of generative AI unicorns, these are actually on the Google platform. Not many people know that, number one. Number two, I think, too, that people aren't paying enough attention

of a premium into Google with respect to YouTube TV. I really think that the streaming of sports, we talk about Netflix doing that, I think this is something that not enough people are talking about and it's going to be a huge, huge tailwind for Alphabet. Jason?

Listen, I remember when obviously they reported last quarter and there was a lot of concern going into the print and they blew it out, right? So EPS was up 37%, revenue was up 16% and Google Cloud, which again was not profitable only a few years ago, was up 33%. So for me, I just want to see more of the same. There's obviously concern around search and all the DOJ cases around the world. So for me, I think

as long as they continue to pay attention to their core business, which I believe they have, they'll be just fine. And it'll be another bang out quarter for them. By the way, a lot of investor confidence when it comes to communication services. The XLC is on pace for its 12th straight positive session to be its longest rally on record since February of 2021. Josh, I want to get your take. Alphabet earnings coming up.

Yeah, this matters to me. I'm in the position. I've actually been trimming it and the stock's done really well. It's held up better than even I would have expected. But I'm not adding to it ahead of the print. And I do think the action, Frank, is going to take place in the Q&A segment more so than it will with the actual numbers themselves. But let's just go through them. $96.7 billion in revenue is the expectation. That would be 12% year-over-year growth.

Not terrible, but for a Mag 7, especially in light of what Meta's been up to, not great. Cash flow expectations, 30.3 billion, which would be about 30% growth. That's a little bit better of a number. And earnings per share should be 29% higher. Also good. Everyone's going to want to hear about Google Cloud.

They're gonna wanna hear if there's any kind of deceleration based on what we heard from Microsoft. Microsoft's cloud business was fine, but it's sort of underwhelmed. And that's really what I think the risk is here. The other thing that I would point out though is the stock is going into this print very strong. It's got an RSI of 63. It's 9% above its 50-day, 17% above the 200-day. So there is a world

in which this company going into the earnings already at an all time high, maybe is already pricing in a good result. And you might get a little bit of a pullback if it's not a great result. So that's where my mind is at going into the print. Go ahead. - Why were you trimming though? Why trim going into the print? Did you trim post deep seek or was there some other reason to trim before that?

Yeah, pre-Deep Seek, to be clear. It's just a name where it's gone up a lot, and I felt that Amazon was the better bang for my buck in 2025. I just think there's more upside in Amazon, and I don't want to overwhelm the portfolio with Mag7 names. So of all of them, I think Google is okay, not great. I think Amazon, the situation looks like it could be great.

Frank, I don't own it, but isn't it really about the usage of Gemini because they hadn't made so much progress versus the other Mag7 in terms of the AI adoption rate? Isn't that what this is all about? That's what the investors really want. Isn't the expectation really low?

I think it's two-pronged. It's also the growth of Google Cloud. I mean, an important part of the business. That will be strong. Microsoft was fine, even though it was a little less than expected. 31% at Azure, that was pretty good. We'll do fine. But I would imagine there would also be a question about CapEx. So we saw Meta hold steady on 65%. We saw Microsoft hold steady on 80%.

I would think that there's still shadows of deep seek in people's minds. Like, do you really need to spend that much on AI infrastructure? Do you really need these advanced chips? You know, there's brighter minds than me when it comes to AI infrastructure, but I think a lot of investors do have those questions. I think CapEx is going to stay exactly the same. I don't think it's going to change at all.

all and i don't think it changes this year next year maybe in two years maybe it's a little less next year than this year but it's still going to be huge in the 200 billion dollar plus range this year and next year in my mind because i think they can't afford not to

Yeah. Well, Josh just mentioned it. Let's get to our chart of the day. Our chart of the day today. Well, it's Palantir. I actually didn't mention that. Surging to a new record high on strong earnings. But just the AI theme, I should say. Let's bring in the investment committee member, Bryn Talkington. She owns this one, Bryn. I'm looking at the chart right here. Post earnings up over 22%.

Yeah, it's really just amazing. You know, in 2024, investors who were listening to the earnings call woke up that Palantir has always been, but now with the commercial business growing, a pure play AI enterprise software company. And I think that you're seeing that today with the stock up 22%.

The stock is still very under-owned. And I think that's one of the reasons the stock is up so much is people just don't really, did not really pay attention to what this company is doing. Their commercial business grew 64% year over year, 20% quarter over quarter. I think when you have a company that's under-owned, it's in the square perfect spot of AI and they have

zero competition or no competition that I know of. I think that's why you're seeing this huge reaction on the upside. So, Bryn, I mean, you're talking about a huge reaction. How about the huge valuation as well? You're concerned about this valuation. Stock trades are about 200 times forward earnings. And then is there any other, I guess we can call it doge risk in this case?

Yeah, I mean, doge risk? No, I think there's like doge reward. Because when you have the government having the inefficiency of how we do cost plus, the DOD with Raytheon and Lockheed, I think that ends. And you have a company like Palantir that already has all of the moat around government products.

projects, that's just going to continue to amplify. I think around the valuations, I mean, the viewers will know if they remember January 2nd or 3rd, I sold over half my position in the 70s because I bought it at 25.

And so it's like that's an amazing return. And so I do think the valuation is really high. I think investors, if you don't own it, you are in this tough spot because this is a darling. It is expensive. But don't look at PE. This is like not a stock. You look at PE. You look at their margins. You look at their growth. You look at where they are and take opportunities to build a position because it will have some weakness over time.

So, Josh, I just heard you chiming in there. By the way, stock's up over 500 percent over the last year. Josh, you were about to say something about the stock and the company when I said, is there any doge risk? Just asking, basically, because a lot big part of the business, of course, is tied to the government. I want I want to I want to congratulate Bryn. This has been this has just been an incredible trade or investment for her. But it

It's worth pointing out as recently as last fall, this was one of the most heavily shorted stocks, not just in dollar terms, but just in terms of like how widespread the short thesis on the company had been. And obviously Trump taking office changed that narrative. So probably some of the short squeeze had happened prior to today, but I can't help but think there's gotta be maybe on the option side,

There had to have been a lot of money betting against the name when they report admittedly great quarter, but get this outsized of a move. So there's probably some element there as well of the end of the short squeeze that let's say maybe started six months ago. But this was the best performer last year in the S&P. It's the best performer again this year, thanks to today. And I can't believe I don't own it. I actually actively

actively hate myself. Josh, to your point, stock crossed 100 bucks for the first time today off of this earnings move. Brian Belsky, very quiet on this one. You actually own this company. Well, there's something about being humble. Sometimes we get it right. And we bought this company in May of last year, and then we doubled our position before the election. And here's why.

As we looked at 2025, we said, you know what, the Mag 7, we want to be more neutral and we want to be overweight on the barbell, names like Palantir, Oracle, that type of thing. And the trade has turned out. Why? Because I think of the broadening out, number one. Number two, the broad ownership of the Mag 7. But more importantly, with respect to Palantir, when you talk about exceptionalism of fundamentals, exceptionalism of the product,

that's what it does. And that's from a stock picking perspective, that's how that company is able to be far and above the others in that space. Yeah, we know all these trading aberrations, we know all of this short squeeze stuff, we know all about this momentum thing, but period, it's a great company with a great product with

with an amazing leader. And that's the kind of name you want to own. Again, Palantir shares up about almost 23% right now. Bren, Brian, take a bow. All right, coming up next, we're tracking the trades. Josh Brown just added a new healthcare name to his portfolio. We will reveal it coming up after this break. And then later, we're getting you set up for earnings from Chipotle, AMD, Snap, and Uber. Halftime back in just a few minutes.

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Welcome back to Halftime. Josh, you have a new buy in the healthcare space. It is Bristol Myers. Yeah, God help me. Here we go again. If you liked how I did on Pfizer, you're really going to love this one. This is, look, this is technical, but I want to say a couple of things about healthcare very quickly. Number one, it's the best performing sector in the S&P this year. Number two,

kind of neck and neck with communications, but most of what's happening in communications is meta, making all time highs. So take that one with a grain of salt. Healthcare is off a little bit today, but year to date up 6.55%, and it was one of the worst sectors last year.

going into an election people don't get pulled up on the circles okay fine so that's passed I think what's really interesting about Bristol-Myers this is a version that Pfizer should look at for how a turnaround actually happens they have a legacy portfolio too just like Pfizer but now they've got a growth portfolio and it's focused on immunotherapy and

and oncology, and that's a very hot area, and the stock is now working. They're gonna report tomorrow, so if I'm hiding, you'll know where I am, 11.6 billion in revenue, which is give or take flat year over year, earnings of $1.47, but I think what people are really gonna be keying in on is the continued improvement of the growth pipeline relative to some of the legacy drugs and the stuff that's coming off patent.

Technically though, is what I want you to focus your attention on. The stock is 3% below 52 week highs, RSI at 57, not yet overbought, only 2% above its 200 day.

But this is a name that looks like it's going to break the November high and just keep on going. If you get a good number in the morning, that's your catalyst. That's why it will work out. If not, I am trailing it with a stop. And it's on my best stocks in the market list for a reason. People are accumulating this name.

I mean, Josh, only because you mentioned it, I do want to ask you about PatentCliff. So I'm looking at Eloquist generics for that next year. Eloquist is about 20%, 25% of revenue. You talk about their growth portfolio, Abdevo, PatentCliff in 2028. No concerns about that? Is this a long-term hold? Worried about that when so much of the revenue is tied to two drugs, they're going to fall off that PatentCliff in just a few years?

Well, this is the nature of investing in pharmaceuticals. They've all got patent clips. The question is, are the bets that they've made in oncology and immunotherapy, is that the next growth area for the company? And will they be able to execute? And the street is aware of everything you just read to me.

and the street has decided that they will execute. They may not, but from my perspective, buying it on the technicals, I won't be around in 2028. I have cliffs of my own to worry about. Brian Belskis, we look in the pharmaceutical, the biotech space. You're also a shareholder of Merck. We're going to show that chart. Talk about a cliff. Shares fall in double digits right now. Your view on the quarter?

Yeah, quarter was bad. The last quarter was not very good. You know, we own the stock because of dividend growth, quite frankly, just as we own Pfizer, too. I mean, I think the problem with the pharmaceuticals

is something that Josh talked a little bit about and that the reason why we're underweight the sector, that's probably why you should be overweight by the way, if we're underweight that. But given the fact that so many people are hating on healthcare, you know the reason why we're over underweight by the way is because of the kind of mood that we saw in Lilly. I think too many people were in Lilly last year. But I do think some of these legacy big drug makers, it's gonna be really difficult to buy them for fundamental reasons in terms of pipelines and growth.

We own them for very different reasons, namely dividends and dividend growth. So as the stock gets cheaper, the yield is going to look more attractive. You also own Pfizer. Your take? Same thing, same drill. You still have a bit of a COVID hangover with this company.

Again, we own Pfizer for the dividend. Here's a company that has not cut the dividend for over 10 years, yield above the market, and also has steady earnings but not great earnings. So again, they're reaffirming their longer-term kind of vision, but at the end of the day, we own it for the dividend. - All right, one more. We might as well just run through them. Amgen reports after the bell later today. - Yeah, we own Amgen in a few portfolios, dividend growth and value.

Now, Amgen is a place we think you should be, Amgen and Gilead. Why? Biotech. Biotech with respect to pipelines. And Amgen's done a really, really great job in terms of their cash flow and their overall pipeline. So Amgen's a name that we like. Let's talk a little bit more broadly about health care. Steph, I want to come over to you. Wolf out with a note. Health care finally overbought, according to the note. They seem more upside after a breather. As Josh mentioned, it was a laggard last year, one of the leaders this year.

Well, I own UnitedHealthcare, and that's a name that is new for me over the last two and a half weeks. In the past year, it's only up 5%. And it is the number one managed care company in the industry. Great management team, great balance sheet, $18 billion buyback, new buyback, by the way. I think the medical loss ratios, margins,

I think that they have peaked on the upside, right? You want them to be lower. So I think that the worst is behind these companies. And I think as you go through 2025, you will see a gradual improvement. By the way, the only pharmaceutical company I own is Lilly. And that stock is still down from 960 bucks, right? So it's still down about 20% from its highs. And I do think that they have an excellent franchise, not only weight loss and diabetes. I get that that's

That's the excitement. But they also have oncology, neurology, immunology. And their total revenues grew 44% last quarter. And that's when the stock fell 13%, which is when I bought it. But I think if you exclude the exciting parts of their pipeline, diabetes and weight loss and all that,

That other businesses that I've talked about, other pipe, that's growing 17%. That is way better than Bristol, Pfizer, Merck combined. So to me, I think you take advantage of the pullback. Jason, you have some broad healthcare ownership, UnitedHealth, the IBB, the biotech ETF, also AbbVie. Yeah, so I'll start with AbbVie, which I think had a really great quarter. And to Josh's point earlier, and just kind of these...

These cliffs, you know, these patent cliffs, right? So Humira was their main drug two years ago. Now it's no longer exclusive to AbbVie. And you think about the other drugs that were in the pipeline, Skyrizi and Rinvote, that are up 50% year over year. And we looked at the quarter that they just had, which was phenomenal. Beat on the top and the bottom. Obviously, these other drugs have done really well. And you saw it in the price action with the stock post-earnings up 6%. All right.

By the way, the Pfizer CEO is going to sit down with our Jim Cramer on Mad Money tonight at 6 p.m. Eastern. It should be a very interesting conversation there. And now we want to head to our headlines with Angelica Peebles. Angelica. Hey.

Hey, Frank, the White House is preparing an executive order to eliminate the Department of Education. That's according to two sources who spoke with NBC News. The move makes good on years of campaign promises Trump has made to abolish the agency, and it comes as the president signed an order to expand school choice last week.

However, President Trump needs to have congressional approval to eliminate a federal agency. About 20,000 federal workers have accepted the buyout offer the Trump White House put forward last week. A senior White House official told Axios, while that's about 1% of the total number of the federal workforce, the administration expects more employees to take the offer, which is open through Thursday. And on Sunday, when the Kansas City Chiefs face off with the Philadelphia Eagles in the Super Bowl,

A White House official confirms to NBC News that President Trump will be at the game in New Orleans. He'll also sit down for a pregame interview with Fox News. Frank, back over to you.

Angelica, I think the Eagles are going to also win by a very large margin against the Kansas City Chiefs. I know you're rooting for your birds, but I'm on the fence. This isn't fandom. It's just reporting. I think it's a pretty solid chance. Angelica Peebles, back at CNBC HQ. Angelica, come on. More positivity. Come on. All right, coming up next here on Halftime, we'll take you inside Brian Belsky's playbook. He just snapped up three new stocks in the consumer space. We're going to reveal those names coming up. Halftime's back in just two minutes.

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- Welcome back to "Halftime Report." Brian Belsky making several new moves in his monthly portfolio rebalance. Brian, what do you got? - How are you? So listen, we had a great trade in Lulu. We were very lucky and we bought Lulu and put it in our value portfolio. It was up 53%. Lulu obviously is not a value stock, but given the fact that the first part of 2024 had massively underperformed, we thought there was an opportunity there. That's how you should manage at least part of value. So guess what is value?

Nike. So here's why we're going back into Nike. I've not owned Nike since 2016. I think from an operational perspective, they are completely coming back and rebuilding it. They've brought back an old CEO. I think ultimately they're going to have a new CEO. They're focused on the shoes. They're focused on the product. They're focused on old school stuff.

I think that makes a lot of sense again from that. With respect to some of the other moves that we made, especially in our small mid cap, we bought Warner Brothers Discovery. Here's why. Cash content and consolidation has been our theme in communication services for five years. I think from a streaming perspective, the way that Warner Brothers is breaking apart that company into two sides,

It's a little goofy, but at the same time, I think there could be some consolidation play there. Now, onto the exciting stuff. We sold QSR and then we're funding it for two stocks. Josh's favorite Shake Shack. I got to get on the Josh Brown train. I think...

Shake Shack is to Gen Z's what Chipotle was to the Millennials. I really think that's the play there. You like that Josh? So think about it. So I've got a couple, I funded a couple Millennials colleges and you know how much money they spent at Chipotle through those years? So I'm guessing that a lot of

Zers are spending a lot of money at Shake Shack after the bars close. But at the end of the day too, the Gen Zers want experience. They want that type of fun atmosphere and that's what Shake Shack gives them. Speaking of experiences spending their money, Chewy, online pet food, we think Gen Zers and Millennials are spending a lot of money there.

All right. So we got two oohs from Josh Brown. One was for Nike. One was for Shake Shack. Shake Shack up about 2.5%. Why don't we start with Shake Shack? We were just showing the charts. Second, about 2.5%. Start there and then go to your ooh on Nike if you don't mind.

I'm a long-term shareholder in Shake Shack. I would own it. I would not trade it. I think Brian's going to make money there. Nike's interesting to me. So I can't buy charts like this, but if I were a value-disciplined investor, I would buy the stock. I think it's going to work.

Do you know how many times this stock has had negative three years in a row share price since its history in 1980, I think it came public?

Zero. What just went on in the last three years has never happened before. An unprecedented horror show for Nike. And on that basis alone, it's probably not enough. So I'll tell you two other things. The CEO is doubling down on athletes, which is what they should have done two CEOs ago. That's what they lost. And...

And it's cool again. There's a rapper from London named Central C, and he's all about Nike Tech, which is the performance fleece. Nike Tech sales are taking off. Central C is helping to drive Nike Tech in the culture, in the conversation. And before you know it, you'll see shoe sales come along with the apparel sales. And this might be the worst period of time Nike's ever gone through coming to an end in 2025.

Yeah, big Central Sea fan. He and Dave have a great album. Also, Luka Doncic going to the LA Lakers might be another boost for Nike. Very quick before we go, Steph and Jason, some of Brian's buys. Nike, Chewy, Warner Brothers, Discovery, Shake Shack. Quick take from either one of you. I'd rather buy Decker's down 21% in the past week. It trades at a four multiple point discount to Nike. I think Nike is fine, but I think you have to wait two years to see results. They haven't invested in years, and so it's going to take time. Meanwhile, Decker's has Uggs. They have

Hoka's, we were just talking about it. They're growing both those segments double digits. So I think that's the one you want to buy. Snipe, quick thought? I'm not really in retail right now for a myriad of reasons. But if I was going to be, the name that I like the most, which is a little different than obviously these players, is Walmart. All right, there we go. Walmart actually hit an all-time high or a 52-week high yesterday. All right, coming up next here on Halftime, Mike Santoli's midday word. We are back right after this break.

And we are back on Halftime Senior Markets commentator Mike Santoli is here with his midday work. So Frank it's the

The kind of day I think most investors might prefer, which is we're kind of reacting to earnings after the close and before the open. It's the market has a lot of two way action within it. There's a net bias to the upside, I think, because of just kind of relief that we're not playing headline ping pong again. But I just wonder exactly how far we can we can take that, because you always have

uh... in the back of your mind you're gonna have to be aware of the this sort of tariff debate incursion who knows when we're gonna settle all that i think it's all happening very interestingly just in this three month range since we really have been sort of chopping right near the highs only two percent of the highs in the s_ and p_ it's not like we've really under stress but there's been a lot of churn and turnover of leadership and i think you have to be alert to the idea with health care starting to outperform maybe there's some

sort of emerging new leadership or character change to the market underway. I asked you this yesterday, Mike. Surprised about what you're seeing in bond yields. I mean, we're not really seeing anything. And we do have some new headlines when it comes to tariffs. China is shooting its tariffs at midnight. Now, you know, President Trump, President Xi are going to talk. Do you think there's some risk there for the market about what comes out of there? Maybe what the president says, maybe actions by either country. I don't know if

the bond market has a clear playbook of this is what you're supposed to do if we get tough tariffs. Either you're going to start pricing in maybe a little bit of risk of economic slowdown if you think it's going to be punitive, or do you decide that inflation expectations are going to become broken loose again to the upside? I don't

I'm not particularly surprised. You know, the JOLTS number was pretty downbeat today. You got a bid in bonds, meaning yields kind of came in a little bit on that because everyone's focused on the fact that what the Fed looks at in terms of economic readings, aside from inflation, is job market softening up. So not really surprised. I think stability in the bond market at these yield levels is probably OK for stocks. All right. Tenure right now at 4.52 percent. Mike Santoli with his midday word. Mike, thank you very much. All right. Coming up next on Halftime, we have this set up. Stay with us.

Welcome back to Halftime. Let's get these set up on some key earnings coming our way in the next 24 hours. Let's start off with Chipotle. It's after the bell today. You can see it's up just over a half a percent, almost three quarters of a percent. Steph, you own this one. I do. So I think they have to do 5.7% same store sales or better.

Pricing has to be up about 1%. Operating margins could be up as much as 70 to 80 base points. But the big commentary is going to be about avocado prices and tariffs and that sort of thing. So luckily, the stock's actually down 12% from the December peak. So I think the expectations are fairly muted. All right. Next up, we have AMD. That company reports after the bell. Brian Belsky, you on this one.

Yeah, it's part of our barbell. We've been adding a little bit to it as it's been down. You know, I think advantageously, we still think that they have a great product. We're going to really listen hard and carefully to Lisa's messaging, which I think is going to be positive. There you go. Belsky, you also own Snap. That also reports after the bell.

Yeah, we love Snap. We love the alternative in the new media side. That's why we added to Reddit and the Smidcat. We do think that this company still throws off good numbers, and I think they're going to beat. All right. Uber also reporting tomorrow before the bell. Josh, Jason, and Belsky, you all own it. Josh, why don't we start off with you?

I think this is the most mispriced security on the NASDAQ. I think it's 50% below where it should be trading. This is a company that probably is going to grow cash flow next year and the year after by 50%. Has the wherewithal to buy back a lot of the float and is just getting...

Jason?

Yeah, so I would keep it simple here with this one. They missed slightly on gross mobilities driven by mobility, obviously, last quarter. I think that will rebound and we'll see a positive return here. Steph, any take on this one? You know, I've never owned it, actually. So the valuation has always been kind of hard for me to understand. But clearly, they're the industry leader. 17 times earnings.

17 times earnings. You could buy it. In the past, Josh, it has not traded at 17 times earnings. It has been much higher in terms of the valuation. Not to say I wouldn't take a look at it, but this is actually in the XLI now, and I don't need to own any more industrials because I'm already about 15 percentage points overweight in terms of my benchmark in terms of industrials. All right. Overshares up just about 3.3% right now. Coming up next here on Halftime, we have final trades. Stay with us.

Are you following the Halftime Report podcast? What are you waiting for? Look for us in your favorite podcasting app. Follow the Halftime Podcast now. Welcome back to Halftime. It is time for Final Trades. Josh Brown, you're up first.

Jason.

AutoZone, Advanced Auto Parts plans to close 700 stores this year. They will continue to grab market share. Bram Belsky. Sonos, S-O-N-O had some operational risks last year, but new CEO and it's a great product.

Steph Lang, last word. I'm going to go back to Decker's. It's down 21% in the past week. It's gone from 38 times earnings to 28 times earnings. Best in class on sale. Uggs are gone 16%. Hoka's growing 23%. Like the story. Josh, we were just talking about, I'm a Nike guy, Josh. I know you're a Nike guy, too. I'm never switching from Jordan. Steph's jumped ship. She's all the way off the ship. You've got to try Hoka. All right, that is for halftime. The exchange starts right now.

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