deal with paramount appears to be falling apart. this is one of those interesting sagas. we in the media look at it because it is a media company. >> we need to bring back succession. this is perfect fodder for that show. >> filmed partly in our studios in englewood cliffs. thank you for watching "power lunch." >> "closing bell" starts right now. >> thank you so much. welcome to "closing bell." i'm scott wapner from post nine at the new york stock ck exchan on this friday. did the bulls get just what they needed this week? a less hawkish than feared fed and a better than expected apple. no doubt two key catalysts behind this late week surge. we'll ask our experts over the final stretch where we go from here. look at the score card with 60 minutes to go in regulation. stocks getting an immediate boost today from that employment report. fewer jobs added, a bump in the unemployment rate sending yields

down, major averages higher. there is the rate picture today. 450 on the ten-year. apple helping too. that stock having its best week since december of 2021. results less bad than feared, and the announcement of a massive buyback the main catalyst there. it takes us to our talk of the tape. is this the week that apple found its footing. le i look at your notes today, you say, quote, it is hard to not be more bullish on apple here. why so? >> sure, so i think the risk ultimately coming into earnings was a fear of a guidedown. we got a guideup. so, we move past the june quarter guidedown and look at the developer conference upcoming, the iphone launch coming later in september, this is historically when an apple outperforms, yet we have seen the stock start the year as one of the biggest underperformance years in the last decade. there is a catch-up trade, the

risk is behind us, estimates seem derisked and there is a reason to be excited about the future. >> the revenue decline, the fifth time in six quarters that we have seen that. what reverses it and why doesn't that trouble you more? >> sure, so, there is the good and the bad. let's take the good first, services, right? services growth outperformed 14%. very consistent. and record gross margins. on the other side, the product business is still relatively weak. iphone declining 10% year over year, the total product business down 8%, there is still work to do in what i call an uneven consumer environment, but what mr. market cares about is what is ahead of us, not what is behind us. it still does come down primarily to the iphone, that's where the a.i. narrative really becomes weaved into. and i assume we'll get into this, but that's where we are more bullish as we look forward. >> because of the a.i. narrative and the a.i. playing into an iphone refresh cycle which has been stalled? >> exactly.

the opportunity to refresh at a time when there is concerns that apple has gone x growth introducing this new technology for the first time that, again, that is ultimately can be a catalyst in our mind to drive that refresh cycle, reaccelerate growth. >> why could you think the refresh cycle has been as disappointing as it has been? >> sure, so, again, over the last decade since the iphone was launched in 2017, the innovation curve has looked very different. it is flattened over time. the early days of the smartphone market saw very significant upgrades, what we see now are maybe more subtle upgrades, maybe some of them in the guts of the phone. apple, silicon, the big powerhouse recently. they need to introduce new innovation, a.i. can be that catalyst, but we are still in a very uneven demand environment, concerns about rates, concerns about the economy, concerns about where jobs might be going. if there is something to look forward to in the future in terms of rate cuts, there could be more confidence from the

consumer to say, hey, maybe i'm willing to spend a little bit more in the future. >> i'm glad you mentioned innovation. the critics today and there are a few. and this snark is about innovation and the lack thereof in those folks' mind, and the most innovating thing -- the innovative thing they're doing now is the massive buyback and this is a financial engineering story, not an innovation story, and that nothing material has changed. now, you've probably heard the same criticism today around the way. how do you respond to that? >> let's take both of them separately. apple announced the incremental $110 billion buyback authorization. biggest in company history. they are effectively -- >> we call that incremental. >> i know. they are generating too much cash, a good problem to have, and they're going to return more of that to shareholders via buybacks. that doesn't mean they're not investing. look at the r&d. they spend $31 billion in r&d this year. how much does microsoft spend?

$31 billion. how much does google spend? $35 billion. to say they aren't innovating i think is not necessarily seeing the forest through the trees. they have a different business model than many other megacap tech fears. i think sometimes that gets lost in conversation. apple doesn't need to invest in a massive cloud business that is more profitable at scale, what they need to do is leverage their existing device space, provide new features to their consumers, and just drive that catalyst engine, again, record install base across gios and categories. all of this becomes very important when it comes to r&d. and i do think they're spending, they are innovating, it looks different than it once did. >> this is the best evidence that when it comes to the inevitable question i always ask you, and others think about, some other way of using their cash deal or otherwise, this is the best way they're going to use their cash through capex, and giving money back to shareholders, either through an increased dividend, which they

did. or the massive buyback which they announced. >> and they will still -- they will still acquire companies, but apple's mo is to look to smaller companies, undiscovered engineering technical companies, buy talent, integrate them into the apple culture and ecosystem and build out that way. we have seen apple build up a number of businesses organically through that means. i see no reason why that won't continue. >> how do i view what is happening in china? better than feared, i get it. we declined 8.1%, that was better than feared. 8.1% decline is nothing to sneeze at. we still have an apple/china problem in a market that once was 20% of their growth. that number has come down a bit. increased competition and declining market share. reconcile all of that for my viewers. >> sure, i would say there is a difference between a cyclical challenge and a secular challenge. i think coming into earnings the concern was apple has a secular challenge. there is competition in the china smartphone market, apple

is losing its flavor amongst consumers in that market. that spells doom and gloom for multiple years. what we learned is that iphones grew in mainland china in the march quarter. far beyond most expectations. now, that doesn't mean that apple doesn't have some challenges when it comes to competition. huawei has come back, but to say that apple has lost its flavor with the chinese consumer would be misleading again, when we see that apple is growing in mainland china. everything isn't perfect, of course. i completely admit that, but there isn't a secular problem. there is an issue of competition. if apple can innovate, come out with new generative a.i. features and new phone, that spells a very interesting dynamic for china as we look out over the next -- >> so you're confident, i guess, that a decline of 8.1%, to use the word incrementincremental, to incrementally get better. >> next quarter, in the june

quarter, apple faces an 11.more difficult compare. so optically, you might get an acceleration of the year over year declines in china in june. that's not a function of demand worsening, that's a function of last year's june quarter being very good. optically that might look bad, but to me, we're not necessarily seeing demand fall off the cliff. that is just purely a nature of numbers and comparing year over year. >> that's great perspective. let me ask you about a.i. we expected a wwdc as everybody is talking about next month. in your mind, what is it going to do? how meaningful is it going to be and is it really going to be that thing that the iphone needs to spur the next cycle? >> i do think it is the thing that the iphone needs to spur the next cycle. i'm looking for two different aspects when we get to the developer conference. first is, what are the features that apple can introduce that the average consumer can look at and say, wow, i want that. historically software is not usually a driver of upgrade

cycles, it changes in form, factor, new hardware. the other dynamic that you need to pair together with hardware is how backwards compatible can they make this software, meaning if it is powered by on device apple silicon, the latest apple silicon, and you need that silicon to power your own device a.i. inferencing, some of your older models don't have the capability of giving you the user experience you need to run the workloads. if apple comes out and introduces a new siri, makes the phone a kind of voice driven intermediate between you, the consumer, and the world of applications and websites, and doesn't make that fully backwards compatible, what i hear is force upgrade cycle. that is what becomes very exciting for me. that's what i'm listening for. >> great to get your insights, great to get them first on this program. i appreciate it very much. that's erik woodring.

let's bring in cameron dawson and josh brown, josh a cnbc contributor. to you first, josh, just to expand on apple. as a shareholder, obviously, this is a great day for you and many others. >> it is. and i was definitely concerned going into the number, not because the expectations were high. in fact, they were very low. especially this stuff around china and iphone sales. but i really wasn't fully convinced that they would be able to tell a story on the services side that warranted continued belief in that being the metric. but they were. they blew it out, actually. so, yes, there is still a hardware issue. what is the thing that is going to make my wife, my kids, myself, want to go and get the next iphone? i'm on a 13 pro max right now. and i am usually somebody who has the newest model. so, like, what is the thing? i agree with what erik had to say. i would also point out, apple

has no problem doing things that are not backwards compatible. think about the way they just randomly decided they're going to change the charger port. everybody has to get the new charger, end of story. so i actually do see that as being a catalyst. the other thing i would say on the technicals here, which erik didn't address, but that's what i'm looking at, apple has just broken through its 50-day moving average. it tested that level on the 29th but failed. now we're well through prior to the 29th apple had spent 62 straight trading days below its 50-day, which does not happen often. that was the longest streak, you have to go back to october of 2015 to find a period of time where apple sat around wallowing in its own bear market for that length. so, i think something is materially changed during sentiment. i think services are the reason why. we will need follow through in june at the developers conference. and then, of course, that follow

through is going to have to take the shape of a.i. siri. >> when i asked a question at the very top of the program, is this the week that apple stock found it footing again, you offered a resounding yes? >> yes, but talk to me in june. because we're not breaking out into a new trading range. i think, look at how this company is making earnings every quarter. it is buybacks. this is flat to down revenue, quarter after quarter after quarter, but earnings growth, how are they doing that? buybacks, we're okay with that for now. i don't think that will keep this stock with a 20 something handle on the multiple for much longer. so, i think the second half is going to be really important. and not just on how much stock they can buyback, but what they can do on the product side, so that we're not looking at 50% of revenues on the iphone side, and say, okay, what is next? we can't be saying that next spring. >> yeah. cameron, buybacks are a big

reason why people continue to look at these megacap tech stocks as attractive in this kind of market, because they're all doing it. and all of the numbers are big. they just don't look quite as huge next to apple's, which so stands out from the crowd. >> yeah, and it speaks to the quality of the earnings of the megacap tech stocks and the fact they're sitting on such huge cash piles that are generating a lot of yield because yields are so high, they don't have a lot of debt as well. so that capital return is good. the thing with apple that we have to watch is do we see an inflection in the core underlying fundamentals. it is great to return capital to us, but if you continue to have low single digit growth, it raises the question what do you pay for that? at 26 times, that is a fulsome multiple for that degree of growth. >> let's talk about where we are from a market standpoint. i think, you know, coming into this week, i think the bulls, you know, maybe felt as though the goal posts were narrowing, right? and i just wonder if that's now changed and if you think it has by virtue of what happened this

week. as i said at the very top, a less hawkish than feared fed chair and then data today if you want to take the jobs number and some of the components of it and say, it is about as good as you can get for the bulls and for the fed. >> yeah, the goldilocks of just right. it is soft enough to take further rate hikes off the table. but it is not weak enough to cause us to cut growth forecasts for gdp or eps estimates. and that's why markets can rally under this. when we think about it from a technical perspective, yes, we're seeing a rally, but we're still right below our 50-day moving average which tells us that we may not be quite out of the woods for the digestion, even with this week's data. >> does it open the door, though, the data today, to a rate cut earlier than perhaps once again we thought f. if you look at the projections from not everybody on the street, but you have several who suggest that july will be the first cut, you can still get four, maybe three, some say two,

and then, of course, maybe the consensus is one. >> yeah, we think one to two is the right number, given the backdrop of the data. we don't think that given where inflation is, given how tight the labor market still remains even with today's data that the fed can move to ease unless we see much weaker employment data or more substantial deceleration in inflation, which just means that we think it is firmly in the back half of the year, november, december is when we would get the first cut. that, of course, would change if we were to see a sharp weakening in labor data. >> josh, address that too. from the monday to friday change, send us into the weekend, thinking about how the narrative for the bulls may have changed back for the better. >> well, i think the main thing to focus on, i guess, is where the odds of the rate cuts have landed as a result. so, september is the first month where the futures have a higher odds of a rate cut versus no

cut. 32% chance of no cut, but a 49% chance of a 25 basis point cut. that could move around a lot, of course. but i feel as though that satisfies all of the conditions that have been on everyone's mind, where it can't be too close to the election, but obviously it should take place sooner rather than later. if the data continued to cool off, et cetera, et cetera, et cetera. i think about it if i was sitting in jay powell's seat, and i think when he saw that reading this morning, he had the data earlier. he probably looked at that and probably went, yes, and so i think the market reflects that. and i think even when you look at the makeshift of which stocks are up the most today, it is tech. it is the companies that want the lowest rates the most. and none of that is surprising to me. so, look, i think we're now at a situation where we're still going to have noisy prints. but maybe we have seen the worst

of the quote, unquote reacceleration fears. >> is megacap tech back so to speak? i put it in quotes, because it never really left. there were some who thought he was getting off the bull train. but if you look the atat this w amazon is up 7.5, alphabet 5, meta and microsoft, 2 respectively. is this trade something we can count on firmly again? >> i think what's funny is that we talk about market rotations all the time. we actually have rotations inside of the magnificent seven. some of these companies are big enough to be their own asset class. we talk about bitcoin as an asset class, it is like a trillion bucks. we're talking about $3 trillion companies and we're talking about apple and microsoft. so, some of these are bigger than the whole russell 2000. if you think of it that way, it

is tough to say we had a correction or that large cap tech was ever off the table, because amazon and alphabet have been making new highs while the market has been selling off. so, in a very peculiar way, they are still using these companies, as a flight to quality, when the vix spikes just not all of them at once. over the last month or so, it has been alphabet's turn in the limelight to the upside, maybe that will shift now, it will be apple. but investors still reach for these names when they're in doubt about the economic situation or the pace of the rate cutting cycle. i don't see that changing. it is like a learned behavior. and the reason why it gets learned is because it has worked. >> what about the broadening story from here, cameron? should we be back talking about it? energy is not acting well. it is the worst in the week, worst of the month. now, rates are down, the russell is getting a bump. how would you assess how we should think about this trade?

>> the equal weight s&p 500 hit a new relative new versus the cap weighted s&p 500 today. you're not seeing the broadening trade. part of that is because of earnings revisions where the most upward are still in these largest names and these largest tech and megacap names. >> where all the growth is. if you look at the growth for this earnings season, it is entirely almost entirely from the names. it is no wonder why the money is going where it is. >> and that story changes as we get into the back half of 24 and into 25. i think that's when we have to ask the question, does the star of megacaps start to fade. because that's when you see the earnings decelerate, materially into the last quarter, 24 and 25. and the market now has priced a big shift where the rest of the 493 really take the mantle for earnings growth. that does remain to be seen because we're not seeing big upward revisions for those names. so, we're not as concerned about megacap leadership today, but it is more of a second half concern

as you see that earnings growth decelerate. >> we shall see. thank you for being here. cameron dawson. josh, stick around. we're going to talk berkshire hathaway ahead of the meeting this week which is now under way. in the meantime, we send it to kristina partsinevelos for a look at biggest stocks moving into the close. >> cloudflare is lower today after topping wall street expectations for the first quarter. the full year outlook left a lot to be desired. that's why bank of america reiterated the underperform rating for the stock with another analyst pointing to deceleration in the second half of this year. that's why the concern, shares are off by 17% at this moment. you also have cybercompany firm painting a similar picture, that would be fortnet. disappointed on its second quarter billings forecasts. investors reacting with shares down 10% right now. scott? >> we're just getting started.

up next, berkshire hathaway's annual meeting is under way. we go there now. the stock nears a trillion dollars in market cap. josh brown owned that name for a while, has great insight on berkshire hathaway. and so does mike santoli. he's out in omaha, at the meeting. we discuss all of it next. we're live at the new york stock exchange. "closing bell" coming right back. >> announcer: this cnbc program is sponsored by truist wealth, where meaningful relationships matter most. this is our future, ma. godaddy airo. creates a logo, website, even social posts... in minutes! -how? -a.i. (impressed) ay i like it! who wants to come see the future?!

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welcome back. berkshire hathaway's annual shareholder meeting under way in omaha. cnbc carrying live coverage of that event 9:30 a.m. tomorrow morning. the so-called woodstock of capitalism drawing a big crowd as always. let's bring back josh brown, he owns the stock. mike santoli owns great views on this firm. it is great to have you.

mike, to you first, because you're there. give us a scene setter if you will and what you think the overall mood is going to be out there this weekend. >> yeah, mood should be good. just i think based on how the markets have done, how berkshire hathaway has done as well, it seems like actually a little bit of a heavier crowd here in the exhibit hall than the past couple of years. we were saying that. i know they're expecting more people. i think the idea is -- berkshire hathaway, of course, is this kind of unique animal. like the biggest nontech stock in the market, broadly denfined. it is many companies inside of it. it is a very broad claim on the u.s. economy with a massive financial cushion in the middle of it, and a way to recycle capital in a pretty efficient fashion, outperformed the s&p over the last years. i feel as if there is a lot of relevance in terms of what the insurance business looks like and what that might mean for inflation.

obviously bonds are massive buyer of treasuries, what is warren buffett think about the prospect for yields from here? and then just the overall economy, whether it is the railroads, or the energy business. >> josh, i think you always have given such thoughtful commentary around mr. buffett and berkshire, you've been a shareholder for a long time, just what that firm has meant to you as a shareholder, i think it has a special place in how you formulated many of your ideas around how to be an investor in stocks. >> i really appreciate hearing that from you, scott. we have been talking about the markets, you and i, for 12 years now. i'm glad that you've observed that from me. and i absolutely agree. i think of some of buffett's most well known ideas such as my favorite holding period is forever, and then i think about how i try to apply that with

what i'm doing. if somebody had invested 1,000ed in the s&p 500, in 1965, they would have $300,000 today. that's an incredible return. if they had put that same thousand dollars in berkshire hathaway, on the same date, they would have 42.5 million. that's the difference. this is now a -- to michael santoli's point, this is a business that basically is so big that it is impossible for it to be materially divorced from the fundamentals of the u.s. economy. so we accept that. it is also impossible for them to replicate the performance that i just laid out and they're not trying to do so. they have $163 billion in cash, that cash is earning money faster than they can dole it out, at current bank interest rates. it is just in this incredible position. the apple position has been extremely important to the berkshire story over the last couple of years. and the negatives, they seem

really cyclical. in the buffett letter, that had gone out a couple of weeks ago, that's what he focused on. he talked about the railroad, having fallen in volumes. all right, that's a u.s. economy story, that's cyclical. he talked a little bit about some of the other types of things. the other negative is real estate. they had a $250 million settlement they had to pay. the important thing, scott, is that the businesses that berkshire both fully owns or invests in the equity of are amazing businesses, and when they're not, they sell, and when they are, they don't sell. and that's why you get the performance you've gotten over two years, five years, ten years, 60 years. it is very simple to me. >> michael, it is hard to think of this event and that's really what it is, it is an event without charlie munger, who passed recently. and it just -- it enables us, i think, to think about what the berkshire of the future is going

to look like. the kinds of investments that they may make in the future. the void of mr. munger and what that means for warren buffett himself as he thinks about what the next great thing is going to be. >> yeah, there is an interesting kind of dual message you'll pick up, which is, one, that charlie munger himself and his voice is going to be missed tremendously. tomorrow, it is like the showcase of buffett and munger's kind of discourse on display at all times. and that will definitely be somewhat of a void. on the other hand, he's been involved and a part of buffett for so long that it feels as if all the lessons are somewhat engrained in the company. what you mainly would look at is what warren buffett himself said about munger, he taught him how to get out of just that kind of old-fashioned deep value statistical approach to cheapness and buy higher quality businesses at fair prices. that's the key single insight that allows you to buy something

like coca-cola, american express, and all those other long time holdings at a price maybe they weren't bargain basement, but the insight was the world will see that these brands are worth more over time than just what they earned last year and i think that's something that will probably carry through, even if it is really hard to move the needle on the portfolio, or on the size of the company in general, because of its financial heft. it is much more different. it has to be slower moving, make incremental bets, it was only early 2016 when the apple position was initiated. it has been a good eight years from there in terms of the gains. >> how would you address that same question, just how you as a shareholder think about the berkshire of the future and what might be the next great investment this firm makes? >> so i think one thing you'll never hear warren buffett talk about is what is the next great thing. there is a really great anecdote in my friend morgan housele's

book, it is a book about the things that never change. and it opens up with warren buffett driving in -- during the financial crisis in a car with an investor and the investor is carrying on, did you see this happen, that happen, et cetera, he said, well, it was the best-selling candy bar in 1963. and it is snickers. what is the best-selling candy bar today? it is snickers. there is something to the berkshire story about investing in things where human -- basic human needs and behavior is probably not going to change. so are people going to be using an american express card in ten years drinking a coke, probably. will they need to use railroads and utilities and banks? probably. that's the berkshire story. the next great thing is probably not going to come up. i would like to see todd combs and ted wexler out front a little bit more, especially considering the fact that outside of apple, the stock portfolio itself really hasn't been so hot. maybe that would be an

interesting thing for shareholders to get to ask questions about if we get bored with asking about insurance. that's maybe something to think about. we might get. >> i appreciate both of your insights. josh, thanks for sticking around. michael, thank you, we'll see you again in the zone. don't miss our coverage of berkshire hathaway's annual shareholder meeting 9:30 a.m. tomorrow here on cnbc. up next, class back in session with big tech earnings in the rear view, the dean of valuation, aswath damodaran has that. "closing bell" back after this. in any business, you ride the line between numbers and people. what's right for the business and what's best for everyone who depends on it. solving today's challenges while creating future opportunities. it takes balance.

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we're back on the bell. stocks jumping today on heels of that softer than expected jobs report and earnings beat from apple. question now, with big tech earnings out of the way, are those names overvalued or not? let's ask the dean of valuations aswath damodaran, the professor of finance at nyu's stern school of business. welcome back. >> thank you for having me. >> i'm going to get to that in a second. i want to zero in on how we first teased the segment here and why you told our production staff that may is going to be the month that determines how returns for the year will look. why so? >> i think the first quarter was all wine and roses, everything was great. everything looked like it was coming together. the economy is staying strong, inflation looked like it was coming down. i think in april you saw the dark side of inflation.

it stayed stubborn. you see the first pieces of evidence of maybe not a recession, but a slowing down of the economy. and i think that that's why i think markets had a tough time last month. the question is what happens going into may, because it is not just the facts on the ground, it is the mood and momentum driving the market. you have a good day today, i think that's a good way to start the month, but i think that there will be more tests coming down this month. and if we don't have a good month, then i think we're heading into september from the positional weakness and we know the politics are going to take over then. election, things happening and i think you'll have a lot more stresses in the market, better to do it when in a position of strength. >> i'm truly interested to know, you know, if i would have interviewed you on tuesday, your answer to where your market view might be could theoretically be different than it is today given what happened with chair powell and how he wasn't as hawkish as

feared and now we finish megacap tech, is that a fair assessment, have you -- do you have a different outlook based on what happened this week through the fed meeting and the data? >> i think we're resetting expectations again. we have been doing this for two years and we're constantly trying to figure out, what is the future going to deliver. and i think it is amazing and you're right, over a period of a week how expectations get reset and it is almost like the expectations are getting reset to, you know what, we're going to have slower economic growth, the fed is okay with it, because i think there was a point last week or so where people are talking about the fed potentially being able to raise rates, not lower rates, because inflation is back, the economy might be harder than expected. i think that expectations get reset, and today we have a good day. so who knows what the next week will bring in terms of expectations getting reset. >> has it also in turn reset your view on where valuations

are? at 5%, on a ten-year, perhaps valuations of the s&p 500 look stretched. maybe not so much if -- maybe not at 4%. >> i think it is debatable. we have been stretching valuations and that band is getting tighter and tighter. i'm not as open about the fact i own all seven of the mag 7 stocks. none of them is undervalued now. the reason i own them, i bought them at convenient prices and i don't think they're overvalued enough to dunk them. i would be buying any of the seven today. perhaps, the exception of tesla, which at least based on my valuation is pretty close to fair value. the rest are a stretch and getting more stretched by the moment. alphabet and nvidia in particular keep pushing the upper limits of what i think value can bring. but as trades, they still might be great trades for the rest of the year. >> i'm surprised to hear you say that about the group as a whole. some would look at let's just use alphabet as an example and

you can throw meta in there too as having valuations that are certainly much more reasonable, they would suggest, than being anywhere close to overvalued. >> if you put 14, 15% growth rate, you can get undervalue. the most interesting aspect of what happened the last couple of months is alphabet and facebook and meta announcing they start paying dividends. that, to me, is an indication that within the companies there is a recognition that the moment -- i think the rest of the market might still think of them as amazing growth companies that can keep double digit growth going, but i think it is more realism in both companies as to what they can actually deliver in terms of growth. >> lastly, how do buybacks factor into the way you assess stocks and their valuation? >> i don't use the dividend discount model. i don't look at dividends.

you take the mag 7, at least six of them are cash machines. they throw out so much cash, they have trouble getting the cash out of the door. you see that in the cash balances growing by the day. so when i see buybacks from the companies, they're basically a reflection of the fact that these companies don't want to become big dividend machines. that's not the kind of investor base. it might start dividends, but even meta, even with the dividends, the bulk of the catch is going to come in the form of buybacks. so apple announces $110 billion buyback, they can announce a buyback and cash balance will still go up. that's what i think is so stunning at these companies. they can return hundreds of millions of cash and have the catch balance go up while they're doing it. >> i suppose, i guess, i'm making the assumption, one of the big reasons why you own all the mag 7 stocks. >> exactly. from a fundamental perspective, these are the intrinsic value stocks of the 21st century.

the coca-colas and the washington -- a franchise of the deliver cash flows, these are now the franchises that deliver the cash flows. >> professor, appreciate the conversation. have a good weekend, see you soon. tracking the biggest movers as we head into the close. kristina is back with that. >> grande consumer headwinds for one retailer, even as they spend those consumer's big bucks on co two concerts. conflicting consumer trends. i'll explain next. >> announcer: the bond report is brought to you by pimco, a global leader in active fixed

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>> >> 15 to go before the closing bell. what's on your radar? >> we got to talk about starbucks. a rough week for this name. shares down over 16% on the week, down 2.5%. disappointing earnings drop in same store sales, which actually led to 18 price target downgrades just this week alone as deutsche bank puts it in their note, there are grande headwinds because of competition and what the ceo is calling a cautious consumer. they don't want to spend as much on the expensive coffees. h hsbc, the latest company, cutting the share to $84 a share, a price target of $107. switching gears, live ation, one of the top s&p 500

performers today after surpassing wall street revenue estimates with management promising that concert attendance even if taylor swift doesn't have a show will continue to grow in 2025. shares can rally to $120, they're trading at 95 bucks now over the next year because of incredibly strong demand for live concerts. we're not willing to spend on starbucks coffee, but we're willing to dish out the dough for concerts. >> priorities. >> yes, priorities. >> have a good weekend. >> i drink coffee every day. i know my priority. >> you and me both. kristina, thank you. still ahead, amgen shares are soaring due to the crucial obesity drug trial. we'll talk about that could mean for the stock and other competitors. with tailored education. get an expanding library filled with new online videos, webcasts, articles, courses, and more - all crafted just for traders. and with guided learning paths stacked with content

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up next, a tale two of travel stocks. expedia and booking holdings moving in opposite direction post earnings. 'lbrk wnheov in the market zone next.

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angelica on that move. seema mody, with two different travel stocks. the s&p at 5130 means what? >> it means the pressure was relieved on a few fronts. both the 1ten, the two-year yied down, that's the market's way of rebuilding the possibility for fed rate cuts down the road because patience might be rewarded on inflation. had amazon and apple earnings, plus all the rest that have built toward a conclusion that earnings estimates seem fine. what happens after earnings season, you roll ahead in another three months and the estimate becomes your baseline for your evaluation assumption. everything is working along the way that you perhaps want to see it, to keep this routine pullback within a bull market. five weeks into it, had a 5% pullback, you're about half of that back. still a lot to prove in terms of the index level. but i do think it has been

relatively constructive even though we have to see if enough momentum was rebuilt in the fundamental story to keep us in this zone where the soft landing seems very plausible. >> angelica, tell us about amgen today, big news, big stock move too. >> yes, amgen shares having their best day, almost 15 years, that's because they're moving its experimental obesity drug into phase three trials. this is a monthly injection that could rival novo nordisk wegovy and zepbound. jeffries today saying that amgen could have a 5 to $10 billion opportunity in the future here. at this point, we don't know how the drug stacksup to the competition. amgen not disclosing the phase two results, only saying they're pleased with what they have seen from the ongoing trial and not seeing people dropping out because of side effects. still, shares of novo and lilly both down today. and amgen did scrap an experimental pill, but investors still excited about the

injectable drug. scott? >> all right. angelica, appreciate it very much. angelica peebles. mike this underscores, highlights the fact that in this space it is glp-1 and kind of everything else. >> 100%. and amgen, pretty cheap stock, pretty sleepy story for a long time. and you get a little bit of this hope in this stock that it might be a player in this area. and you see the result. we have made the comparison before, but it is like when boring old broadcom became an a.i. play and there was room for expansion as long as that story seems credible. >> all right, seema, you sat here on post nine and told us what to look out for, from both of these reports yesterday. now they delivered stocks in opposite directions, why? >> there is two reasons behind this outperformance that booking is seeing. it is aggressive spend on marketing at a time when expedia pulled back, really allowing it to gain market share in the home rental category. expedia is experiencing a slower than expected recovery.

booking also pivoted into international at the right time. they're seeing china, japan, europe sales increase, this is a region -- country specifically where expedia has less of a presence. this is the last quarter for peter kearn who led expedia since 2020. still a number of price target cuts on the stock this morning, scott, so what we want to see how this company turns around and when this technology migration will start to pay off. i will point out they did reiterate the buy rating citing valuation on expedia. >> seema, thank you. mike, i'll send it back to you. out in omaha. one of the questions on the shareholders' minds this weekend and certainly the journalists' minds too is what if anything and when is berkshire going to do with that mountain of cash? i don't know if we get any

clues, but that is an outstanding question, shall we say. >> no, for sure. it is says a lot about how the hunting is, in terms of well valued investments. we do keep in mind get berkshire hathaway's earnings first thing tomorrow morning as well. you're going to see how the company performed exactly how much cash there still is in there, and, of course, in the course of hours of q&a, warren buffett will weigh in. they have been satisfied to have a massive amount of idle cash sitting around and now you're earning a pretty decent yield off of that. so, that will be among the things i think we'll watch for, as long as -- as well as the views again on all the big mac row issues, like yields and value investing. you've talked to about values. >> most importantly, did bill murray give you your shoe back? >> yes, he never did secure my

shoe. i do have it. >> good stuff. you enjoy yourself. enjoy yourself out in omaha. don't forget to watch tomorrow, cnbc at 9:30 in the morning. that does it for us. have a great weekend. see you on the other side on in the ot with jon fortt. >> softer jobs print boosting hopes for a fed rate cut and sending stocks sharply higher to end the week. that is the score card on wall street. winners stay late. welcome to "closing bell: overtime." i'm jon fortt. morgan brennan is off today. this hour, torsten slok weighs in and talks about when the fed could cut. and what is next for apple after a massive buyback? we'll talk to an analyst who says there is a lot more upside ahead for th