tv Making Money With Charles Payne FOX Business January 29, 2015 6:00pm-7:01pm EST
his new album. you'll want to see that. that's it for tonight's willis report. thanks for joining us. dvr if you can't catch us live. "making money" with charles payne is up next. have a terrific night. charles: i'm charles payne, and you're watching "making money." it was a huge rally day. the market up 225 points. it doesn't tell the story. all off the canvas, wild ride. visa, amgeneral, even google after a big miss, that's coming on strong. all of this, and, of course, shake shack going public tomorrow. we have so much to talk about. let's go to nicole petallides. >> charles, no one knew what today would bring. in fact, it brought big moves to the upside. dow jones industrial average up 225 points. 1.3% gain. that comes on the heels of better than expected weekly jobless claims. and certainly a turn around in oil which
helped turn things around. boeing and mcdonald's led the way on the dow jones industrial average. winner of the day, the week, forget it. obviously more demand for boeing's aircraft. and mcdonald's, the ousting of the ceo, changing of the guard there. then some of the movers. coach and kate spade. more demand for their handbag. great news ultimately. royal caribbean. that was a loser. that came under pressure. amazon, google, names to watch tomorrow. as well as shake shack. back to you. (?) charles: i know you like shake shack. thanks a lot, nicole. big week. hilary kramer. she's been spot-on. i'll take her to task about baba. cio of a&g capital. we need all your investment wisdom. you ready? >> absolutely. charles: scottie nell hughes is with us again. hitha herzog, retail analyst. a lot of retail in the
news. matt mccaul fonder of penn financials group. we had a great day. (?) so here's our real, real deal. you know what, another one of these tug-of-wars. the market, it took a really -- it took a moment. it erased yesterday's losses. i always say that an assessment of the fomc, isn't the moments after. those last two hours are extra emotional. the next day, rob, what role did the fed play in today's rally? >> i think they played a big role. they basically said they'll hold off on rate hikes for the near term because basically inflation is below the target range. and it's not going to get there any time soon. charles: you didn't read that they'll maybe do in t in june? >> i think it will happen sooner than the markets expect. charles: this year. >> i do. (?) but it's always great to hear that it won't happen --
matt: charles, what about yellen? she met with the senate democrats and told them, the economy is not that good. we won't raise rates any time soon. that leaked out of that lunch. she tells them in private something else. >> she went on those comments and said the economy is not negative likeit been in the past. it's neutral. she's more positive. matt: neutral is not good. >> but it's not negative like it's been in the pass. charles: not enough for the fed -- matt: heck no. it needs to be robust. >> in many ways, charles, this is a technical rally. we bounced off last week's lows. there are a lot of other reasons. there is a technical aspect to this. charles: i'll start with you, scottie. at least the market is coming to grips with the fact that the fed will one ka day hike rates and it will be normal? >> our hikes will be normal. how quickly will it increase? when there l it start. >> we have to see what happens with the gdp numbers. if they get revised,
we'll see where it goes. charles: i think it will go lower. handing the baton, it can't be a neutral backdrop. it's hard for the fed to take a victory lap. for a brief moment, oil wasn't a drag on the market. matt, oil came back a little bit. it felt like we disconnected again. we saw this a month ago, when oil was down and stocks were up. are we back there where we don't have to be dragged down by lower oil prices. >> i think we have a down day. get close to 40. that will bring the market down. we get tired of it. you look at the same thing every day. oil keeps coming down pick up become numb to the fact it's going lower. another big down drop will hurt the market. >> when royal dutch announced in their earnings, $15 of capex being canceled. when oil firmed up, that had so much with bringing the market back. charles: i think now the number is $20 billion in capex money
that have been scuttled. people have been fired. people are still paying their dividends. i don't know, rob, we talk about this a lot. what does it say when a company says i'll fire a bunch of people. i'll stop building projects. but i'll make sure i pay a hef hefty dividend. does it say i care about the stock more than anything else? >> i think they're trying to keep stability there. the cash flow is still great. this too shall pass for them at some point. charles: i want to blow the first whistle of the show. i thought the market would make a stand after the initial jobless claims. 255,000. well-below the 300,000. we had earnings from coach. kate spade. it goes back to that idea, can main street, they're two-thirds of the economy, can main street come to the rescue? brings us to our next real, real deal. matt, you said the initial jobless claim could be better. matt: could have been great.
you take out the five shale states. texas, west virginia, 75% of that number is from those five states. take that out. it was great already. charles: imagine if we had 200,000. wouldn't that be enough for janet to say this is ridiculous. matt: she would be almost forced to. but i don't think we're ready for it. >> that's the irony that's going around here. there's this whipsaw going around. janet yellen will tighten if the market looks better. we saw good data come out today. at the same time she felt us saying, be patient. right now, i think we're discounting the fed. charles: no doubt, this will be sloppy. some people in the market only because of the fed. but if we have a strong economy, and that's the backdrop for investing in the market, that goes back to investing ten, 101. coach up, kate spade up, even michael kors up, do you like them? is this going to help
you get back on board. these are convincing -- >> they are lower estimates. coach sales are down in north america. he didn't beat on earnings. they were down 38%. kate spade, i like kate spade, but they're also -- charles: on the bottom line or not on the top line? >> they beat on the bottom line. charles: okay. >> that's a good thing. the problem is, they're still -- their estimates were already low to begin with. they didn't really meet anany of those expectations. when someone says, we're expecting this with coach, they beat on the high end. that's a good sign. this is not a good sign. charles: what's your assessment? >> i like michael kors as a pick. charles: that the one you shop at? >> i try to stay away from all three of those actually. michael kors is so cheap. indicate speed is a little nose bleed hike right now. i wouldn't really -- >> kate spade a lot of consolidation going on and they're growing in china, which i like a
lot. because of that consolidation, i like that is doing well. charles: i never see anybody in kate spade or coach. i don't see anybody in kors usually. i dipped in because we're on kors. had to make sure people were in there. >> michael kors is so popular. i'm seeing a lot of popularity. look around and see what are women actually using? they're using michael kors bags. charles: here's what scottie said to that -- scottie and hitha say they've been selling them out of discount spots. >> going to the t.j. maxx and the ross. you can buy them for half -- charles: the snob -- >> they're losing brand equity into the cost. i won't pay $300 for what i can get at t.j. maxx for half the price. charles: you like coach? matt: kate spade. i love kate spade.
expansion in asia, that new conglomeration. i would buy kate spade right now. on the three. charles: we have a mixture between the two. mcdonald's is no mix of opinion here. the demise provides an amazing lesson. listen, it's going to help you on this. learning how to hold a stock. it gives us an opportunity to talk about shake shack. this thing is heating up huge. the stock market is heating up too. let's make money on both. we'll be back in three minutes. ♪
was on automatic pilot as a business and chart. look at this chart. from january 1st of 1997, the shares were changing hands for a dollar. by september 2011, they were at 100. up 90 ninefold. absolutely amazing. of course, resting on theiels finally caught up to the company and stock. both are in dire straights. so don thompson started with the company working the grill. that's an amazing story. unfortunately, he was way too slow to move. perhaps he was -- same store sales that were pretty good the first year. the fact of the matter is, all of last year, sales, all in the tank. the company had the secret to remaining relevant. it was in this graft. that's when they notified in chipotle mexican grill. they had 500 locations
before going public in 2006. mcdonald's started to sell their stock. at the same time chipotle went public, everyone said these guys have the right formula. a unique restaurant concept. good management. food quality. that's all we hear. 1998, 2006. finally, in touch with the consumer base. fast food, that's a myth. chipotle, $22, first day traded, 44. now, about $750 a share. by the way, there's this odd requirement for restaurants, it's called taste. the consumer reports tasting ranking last year, mcdonald's not only came in last in the hamburger category, it was last out of all 52 restaurants across four different categories. lack of innovation. in the longest stock, no innovation. it's a warning. management, and, of course, in a restaurant, you need good tasting food. it remains to be seen if mcdonald can turn it around. shake shack is expected to be a juggernaut.
it will trade under shhk. i'm grappling with it, but i'll buy it up to $20. priced at ipo. breaking news should be at $21. guys, this thing is turning out to be a super-duper -- i mean, it's not a quadruple billion dollar company. but everyone loves it. we did the postmortem on mcdonald's. i want to get your opinion on whether you think the stock is buy now that there's new management. >> i do. charles: you liked it last time when you were on. >> and i didn't see the management coming. the thesis is the same. great value play. not a lot of downside in the stock value price. 4% yield on the stock. and they're going to shake things up. charles: you have to be patient though? we had a knee-jerk reaction today -- >> i think you're being -- >> patient is an understatement. i would wait another
quarter to go into this stock. the ceo just got there. they have not innovated at all. they don't know who their customer base is. they have all these things on the pipeline to do in order to get the younger customer base. what are they doing to take away market share from these other stores? >> keep in mind, same store sales have been very disappointing. eventually that will probably reach a bottom. charles: lower expectations -- who knows where the stock will be by then. gut the whole joint and start over again. here's one of the problems i also saw, scottie. mcdonald's was always in constant battle with the left. food police, nrb, there's been a desperate attempt to take over their balance sheet. they have the second work force in the country. mcdonald's, walmart. that sidetracked them. >> ibm is a great example of how government regulation and the government taking the focus off the product.
they dealt with these antitrust laws. they had to pay attention. at the same time, their competitors were focusing on their product. the case gets thrown out at the very end. this is actually detrimental to mcdonald's. but when with this ceo -- charles: put blinders on. >> go back to the basic fundamentals of a few items. make them good. charles: we should be honest, some may say, he kind of stole -- not stole the company, but smart enough to buy it from the mcdonald's brothers. he had more faith in their company than they did in theirs. matt: it's like technology and innovation. you can go the way of sears and let target take you over. i think mcdonald's will be able to adapt. charles: i would gut the whole joint and start from scratch. >> that's probably the only way to do it. the whole sector, the paradigm has changed. there's just too much competition. even the children, back to that point about
unhealthy, even children believe it's unhealthy. that pink slime they think of. it matters. charles: imagine if you were growing nupt up in this done tht 20 years. every time you pick up a newspaper, everyone demonized as a kid growing up in this country demonized mcdonald's. you won't eat it as an adult. >> i'm from the generation before. my parents, that's all we went to. that was dinner right there saturday night. this generation, they have these viral videos with the pink slime in the chicken nuggets. charles: all of that, to me is tough because i think the left has had a lot to do with the problems at mcdonald's. they need a strong ceo who can ignore it, but fight it at the same time. real quick, stay focused on the topic of restaurants. talk about the other stocks in the space worth buying. cheap ga gas. we know they're hot. >> i like chipotle.
the earnings aren't too expensive compared to the others we talk about. will grow earnings. >> i like pepsico. they did a deal with buffalo wild wings. there will be a halo ring with that. also a deal with yum brands. >> i like them all. i'll stick with mcdonald's. obviously, i think we have a lot going on. interesting to see what this new ceo -- charles: good thing you're young. >> texas roadhouse. charles: no, no, no. what else you got? >> 1.7%. i'll come up with another one. i'm telling you, that's growing. >> if they're able to go local, you have to go to one to see the way it works. there's a butcher, a baker, it's a happy sense to it. and the alcohol, it's just overflowing. women love it. and they're going -- charles: we do talk a lot. a lot of people are watching. not big city folks. i talk about cracker
barrel all the time. anybody who goes there once a week and goes there with their family, it's a shame they don't own the stock. matt: chili's, low gas prices. middle of america. i think they'll do well. charles: that's really not italian food. aimagine i don't see. throwing in the towel, it's never never easy. sometimes it's an absolute necessity. i've got an investment lesson. when you have to cut your losses. it's important to make money, but we're here to save you money. in three minutes. ♪
charles: all right, guys. when you toss in the towel, it's a decision. let's face it, we all have to make in all fascinatefacets of our life. it's never easy. sometimes we look back and wondering why it took that long. target doesn't want to wait five or six years to become profitable in canada. they threw in the target. without many options, sky mall held to products like the uv shoe deodorizer and the doggie raincoat, scottie knell how d's favorite. i'm sorry, scottie. this brings us to when investors should throw in the towel. (?) i'm using three different types of people in the market. swing traders. they'll hold a stock less than 30 days. 3 percent should be your stop loss. you'll probably have a smaller loss than that
if you day trade. it means taking a lot of losses. you have to have the right sort of frame of mind. people don't like to take a lot of losses. it's an emotional rollercoaster. buy hold, up to six months. five, maybe 7%. these are mental stop losses. if you're in a winner and you had it for six months, okay, there might be a hiccup. maybe you want to stick with it and buy more on dips. again, it depends on your temperament overall. if you're truly what we call an investor. most people call themselves that. you should close out an idea based on the movement of the stock. mostly based on the material changes and the valuations. having that said, i want to go around the panel here and get your steadfast rules or at least one rule of when you would sell a stock, hitha. >> two consecutive revenue and same store sale misses. that's when i would sell say stock. if i'm not doing with
retail, two consecutive -- charles: that would be a recession. i got you. okay. >> just in general, change in fundamentals. that's what i would look for. and just basically starting to see kind of the -- the beginning part of that. because obviously, if fundamentals have changed radically the stock will be -- charles: i'm a big operating margins guy. some people try to guess when they get into the extremes. i'm worried. that's a yellow flag. >> i want to see momentum. even just baby steps. if they see they will have a profit loss, bad product, they'll shift the focus on another product and not make a big deal about it. charles: you want nimble management? >> exactly. >> balance sheet. in this environment, you can borrow as much as you want. we have to be careful very soon or maybe a year from now with tightening that companies don't take on too much debt. that's when you want to sell. charles: how do you know if that's too much debt. free cash flow?
>> the wider market. and as well how much they're growing, versus how much debt they have on. it's really the ratios. matt: if you see the trend -- down trends, lower highs, lower lows. alibaba, ever since november, every high is higher, and every low is lower. get out of the stock. charles: hey, guys, austerity, american style. is it too late or is it too early rather to change courses because president obama says, hey, let's sequestration, he's using his typical talking points. ♪
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charles: we are talking about austerity american style. president obama wants to stop sequestration from defusing it as talking points, on the white house website they talk about sequestration men and women on a bunch of things, they say the afterschool programs have been hit, the elimination of 30,000 teachers and meals for more than 4 million people mostly homebound seniors. and of course, less cities, less money to fund first responders and these are for the local communities as well. and then theration, while coming here is another thing that we talked about, the administration doesn't like to talk about the cuts included to make emergency unemployment faith, there is a left leaning company and they have a correlation. they said it is at the expiration of long-term benefits that have also correlated with fewer people being lifted out of poverty. what we learned this week is of
the 3 million jobs graded last year, 1.8 million worker were we linked to people pounding those bricks after unemployment benefits. $1.8 million because of unemployment benefits running out. president obama wanted to take a victory lap and talk about their deficit cuts. we are almost at 500 billion. you don't get there without sequestration. so going to you on this, i think it's going to be a pretty big battle. the president is going to take this to the american public. should we loosen the economy up? gets more government spending out there remapped. >> the government spending is exactly where need to be in creating jobs. if president obama pulls anymore about this defending green for clean technology -- charles: what about the
community college thing. that seems to be when he can sway the public and the middle. >> that is completely political on every level. >> it could make sense because those that are looking for jobs, sticking them into community colleges, it's like a band-aid for a short-term. >> it doesn't make sense because those are the jobs we are asking about right now. you're going to have a lot of people do to your degree without a job that we pay for it. it makes no sense. charles: here is the thing ,-com,-com ma yes corps and that's as middle-class economics, and i'm not exactly sure what this means, but i do think that it means we are sort of understand. and we are crunching down and we will all be equally miserable. >> president obama defines it as being 150,000 for a joint couple. but the problem is he is basically not motivating people
to get to the upper class, the more money you make him and what he's going to take away in taxes. so what is the motivation right there? and also he has a harder transaction of getting into that next class level unless you have some inheritance or some other asset that you can accumulate yourself. >> i'm smirking because the middle class -- >> the senate said the 1% is $241,000, so i don't know where this middle-class is. charles: whatever the number is, it's getting lower and lower. >> it's a combined asset. >> i think the middle is someone around this. >> you know, i agree with matt from this dam coin of for-profit education which is under fire and now we are going to don't more people into community colleges, this is the thing.
>> a bunch of money was poured into it, what happened to housing prices? it went through the roof. >> easy and available, you talk about the taxpayers being on the hook. >> i joined the air force to go to college and none of my friends were come every night i would go to class and all of my friends are drinking beers and grilling steaks. i can drink three bears like that. so i think that it might be a gimmick. and the way sequestration works is this a specific line 5%, but here's the crazy thing, these stocks have been absolutely a part of this. >> i think it's a bit overextended right here, it's a
long-term plied, there's too much international business. charles: my theory is that president obama singles out opportunities for establishment gop to take some of this money because defense is obviously a gop issue. what if he does get the budget down? >> oh, sure because then the defense budget can grow again. but even if it didn't. your 2.4% ratio, but without medication radar, it's really on a different level in the electronics aspects of it are part of this.
>> i also like russell simmons. >> the other day i saw as i came across it. >> i didn't actually see all the prices. charles: the big argument is that greece has a collection, they don't want austerity anymore, we have our own form of austerity that is nowhere where it should be, but it is a start and i hope we don't oversight. i don't think that we will, although we worry about this and the establishment gop. >> it's kind of like education for the democrats, they are afraid to vote. are they going to sit there and had budgets of their friends and cronies that donated to them. charles: okay, guys, hope you had a chance to check out the fox business news show. they premiered this week. we also have jamie colby with
strange inheritance. and then we have our grow kennedy and her self-titled show. you don't want to change the channel. and i have a question for you. what does superman and spiderman have in common with ikea and mcdonald's? we will tell you about it next if you stick around they challenge us. they take us to worlds full of heroes and titans.
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to the vaccine or its ingredients if you have a weakened immune system, you may have a lower response to the vaccine. common side effects were pain, redness, or swelling at the injection site. limited arm movement, fatigue, head ache muscle or joint pain, less appetite, chills, or rash. even if you've already been vaccinated with another pneumonia vaccine, prevnar 13® may help provide additional protection. get this one done. ask your healthcare professional about prevnar 13® today. charles: okay, i am blaming stuart varney. the bricks are taking over. king george in the house, we will talk about it coming up next
knickerbocker? >> even though i have been in the united states for nearly 40 years, i find it difficult [inaudible] charles: outlives them making fun of each other's acts on air. so here's the answer to our question. in the most recent movie they were played by british actors. it makes another american company that decides that a brit is the best person for a job.
>> the mayor of london is actually an american citizen. did you know that? charles: i love him, but he looks like a nut. >> right now he doesn't want to pay american tax dollars, and he's not either way. charles: wire the birds getting all the good jobs in america. >> whether charlie chaplin or others, they come here. charles: here is my pushback on that. >> behind-the-scenes it's easier for them to say things like what is going on. >> it goes beyond because it affects the latest coming down. while i am optimistic about the
future, he put more nutrition or stop together, he talked about composting and recycling, he has a little bit more of a progressive stance. >> anyone from price waterhouse cooper doesn't necessarily have the imagination were still for that. charles: i'm so jealous because if they mispronounce any name -- >> i am not too bothered by it. if there were some systemic thing -- this could be a part of it. >> i still think that there's something weird about it because
i can see maybe when they introduce themselves. but the role sometimes, it's like someone from appalachia. >> maybe it's just a sign of education. >> that british accent really is a part of it. >> a good example would be madonna. she is always a the leader in terms of trends and popularity. >> we believe you right here. we hope you guys had fun. so i have a red-hot stock is breaking out. i will tell you what it is when we are coming back and we are here ultimately to make you money.
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>> it's like if they get $11.75, $11.35, major breakout. >> revenue up, the consumer technology area is very important. >> it's interesting, i was looking at a market share chart, honestly apples here, samsung, all the others in the little players are also going up. and you don't necessarily have to pick the winner, sometimes you can pick those that are good picks as well that. >> i definitely like this is while. charles: so we have yes and yes, breakout breakout. >> 1170. >> 1170. charles: i have to give a shout
out to jon husted i started my e*trade account because of your show in my family we have always done well because of your picks. he thank you very much. that is the goal with the show. and it's such an amazing huge day, someone has rd criticized me for spending it. i will give you a second for "payne's investment playbook." get your pen and paper, we are going to make you some money.
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no. portfolio. and if doesn't perform well for two consecutive gold. quarters. quarters...yup. then amerivest gives me back their advisory... stocks. fees. fees. fees for those quarters. yeah. so, i'm confident i'm in good hands. for all the confidence you need. td ameritrade. you got this. charles: all right, we'll go back to the charts.
talk about buy signals. remember last night i was talked about the s&p 500? i said it needed to hold 2,000. that was on the closing basis. and it's exactly what happened. by the way, it's what happened -- the way it happened was very, very impressive. it was an intraday reversal from a day that obviously could have been an absolute disaster. that's one of my favorite buy signals. that's the intraday short-term trading buy signal, more often than not. here it is. dipped under that 200 mark. then moved to the upside. you can see the index is still in the short-term down trend. we'll have to take out yesterday's high. we do that. if you've been cooling your heels, that will be a goodbye signal. by the way, over the past couple of weeks, a lot of investors been burned. sold a lot of stocks on earnings. (?) they took big losses on them a lot of times. those earnings in many cases were good beating on the top and bottom line. that was the case with
cardo ceramics. they beat the street. top and bottom line. what happened out of the gate? the stock was annihilated. it's clear to me that once the panic started to subside a little bit. in my mind, these are a lot of individual investors. smart investors came into this stock in a big way. made a double digital percentage move off the lows. now, listen, sometimes the noise is louder than the stocks, and stocks react. but as an investor, you have to zero in on the ladder, known as fundamentals. you have to pay attention now. i love when ideas i recommend stage remarkable rebounds. i've talked to you about harm in3 or four times. keep buying. keep buying. grand slam. buy low, sell high. looking for those reversals could be your
guide. (?) you could apply that to a lot of stocks. a lot of stocks were down huge. made huge reversals. if i can see it on two times the daily volume, i love it. let me go around the panel and talk about a buy signal that would be good for individual investors. >> mine actually is more on the market in general for stocks. and looking at the weekly initial claims today, 15-year low. come on. that's a great sign -- charles: that's real macro. the economy backdrop is good enough. any weakness in the market will be corrected on the upside. >> absolutely. >> beating on investments on a major way. amazon beat on their estimates by 27 cents. this is a big deal. added a bunch of new users to prime. back to your fundamentals argument. charles: we'll wrap it up with this. amazon is up by 40 points. biogen 40 points.
absolutely phenomenal in the after market. >> stock being sold off. it's still okay. the pe ratio is at 20. charles: me and matt are more peg ratio. matt: yeah. charles: what's a goodbye signal for you? >> i'm a catalyst driven investor. (?) at the end of the day it's about the technicals. and buying the strengths. charles: really? i wouldn't think that -- >> i wouldn't think that. >> part of a team of mine. i'm looking at macro. i'm looking at legislation. changes in -- charles: you're real macro. >> ultimately, never find the tape. never fight the trend. charles: you don't use that approach on selling. i've seen you hold stocks that have broken down. alibaba is down, but you still like it. >> different kinds of investments. there's the short-term. which is the in and out president long-term is, hey, i'll own alibaba. i'll let it sit there 20 years. matt: the low of 1988 we hit a
few weeks. we hit today. i like buying on support. pullback to the left. other lows we've had in the past. today was a great -- a turn around for me. charles: when i pull out a chart, i start with the 52-week chart. how does that help you? matt: i look at the 52-week chart first. i want to see how the stocks do the last few years. the trend. charles: we have 20 seconds. anyone don't think tomorrow will be a big day? i think we'll have a huge session. i don't know what will happen. >> it should be good. charles: even google which laid an egg was able to talk itself out of it in the conference. matt: i think europe is done. we're not concerned about that. fundamentals look great. rally. charles: we'll see you. hey, by the way, great job. i hope you guys have seen these new fox shows. new shows have premiered this week. they're doing amazing. ms. jamie colby. "strange inheritance." tonight, 9:00 p.m. catch
that. don't miss our girl kennedy in her own self-titled show. fantastic show. really, really appreciate it. at home, if you can't watch us, dvr it. i'm making you money. lou is next. lou: good evening, everybody. i'm lou dobbs. what was once perceived by many as president obama's sudden encyst answer on war against libya may have been hillary clinton's rush to overthrow mo gadhafi. military leaders and at least one prominent democratic leader at the time was convinced that the secretary was managing the flow of intelligence to solely support her desires to oust gadhafi. newly released audiotapes revealed the pentagon used