Stocks on the rebound as you can see, still tracking for five straight weeks of gains on optimism over tax reform that optimism sending the man to my right, tony dwyer, to raise his target for stocks in the new year to 3,100. Now youre the top dog now was that the plan . No. Thats marketing bs. No, thats marketing bs. Its more the methodology of how i get there. For the last six months ive said my 2,800 target for the s p is too low because you had to implement the tax cuts but without a Corporate Tax rate, i have no idea what that is. So 21 , that adds 9 to the s p earnings im at 140 for this year, was at 140 so now im up to 155 the market is trading at a 20 multiple why should that change so im assuming a 20 multiple. Im too low for both, the multiple and the earnings. The 3,000 club is growing, seemingly by the day you get Credit Suisse bumping their target up. You had a couple of places yesterday doing the same thing and 3,000 is right around the highest number now that tony is a little above that. Does that make sense well, it makes sense to be positive about the economy because we just got this big tax cut. What concerns me is when you get the consensus all moving up together and were in a business where the consensus is often wrong. The herd mentality worries you. We worry about that i think the idea that a 20 multiple is here to stay is something that we could question if we talk about Interest Rates or inflation. What if Interest Rates move up what part, the long end or short end . The fed will definitely invert the curve. Once that happens, we still get upside. The tenyear is knocking on the door of 2. 50 im not saying 2. 60, 2. 70 is going to be cause for worry. It really shouldnt matter. If we get towards 3 its going to put a little bit of a it extends the cycle. So long term its better it could cause a crash whats going to happen you want to make god laugh tell him your plan in 1995 when the market peaked at the end of december it was on a fed rate cut you went down 2 , rallied a little in january and then went down 4. 5 right before you ripped into midyear. Thats our call. Youre going to have a choppy period, worried about Interest Rates, worried about Economic Impact and vitality coming from the tax cut. But this was in place far before the tax cut. The genius of the tax cut is that it put at t and the other companies that have followed suit, have put real money in peoples pockets that makes a difference so that changes sentiment and also really does add its not like an accounting gimmick that came up. Youre actually getting real Corporate Cash flow improvement. How is about anything but overwhelmingly positive for the stock market well, it should be positive for the stock market i think the problem that i have in the last couple days, i keep hearing everyone talking about taking technology and reducing your exposure to technology. If the environment that tony is describing is going to be in place in 2018, then clearly Technology Needs to be included in that portfolio. You think for a second hes telling you to stay with technology. At t tony is doing a good job of talking about that here today, but many in the last couple of days have said technology is not going to be your place to be. It depends on what your time frame of that trade is dubrovkoe said technology is still going to work. And i would disagree with the tactical shorter term type of trade. If you think about flipping the calendar into 2018 and listening to the Conference Calls of technology ceos, and more importantly cfos, if a company like at t is coming out and saying, okay, were going to take the advantages that weve got here in this tax reform bill and redeploy the capital to our employees, what do you think a company like apple will do special dividend, buyback what do you think microsoft or facebook is going to do . If you look at where the s p is going to go over the next, lets just call it 12 months for this particular part of the conversation, wheres the risk to the 3,000s or the 3,100 targets . I think the only risk, as tony said, even though he just raised his, his risk as he says is that hes still too low we talked about it yesterday on the desk i think a lot of people will still be undercommitted, judge, to the markets i think that when josh and i were sparring about it yesterday and josh said 50 of americans hate this tax cut, i said its because they have been lied to because they dont really understand what it is. In february when this money starts showing up in peoples accounts, it will be spent it wont just be the up wi1,00t at t tosses to its employees, it will be more money in peoples pockets. I think that carries us throughout next year yes, corporations are going to be paying a lower percentage and thats why guys like tony are moving up their targets on the s p, but im saying the consumers, 70 of the economy is going to be driving this thing. Well, dont forget credit is on fire. You have had a record Corporate Credit issuance of 1. 8 trillion this year in Corporate Credit. Thats not going to stop so its not just about the tax cut. I want to be really clear. All of these things to be bullish were in place and they have not changed, including what happens when you flatten the yield curve is absolutely historically a bye signal which weve discussed several times. Youve got equity friendly things in the background on top of this tax cut and that again is an important influence to what doc said. Part of the reason were discussing how bullish str isis strategists and investors should be, doc, ill come back at you a little bit. Okay, please. Was the biggest part of the tax cut geared towards corporates or towards people because it was geared towards corporates. The biggest part was geared towards corporates. So i dont know what the lying to you nonsensical comment is the lying part is they say the middle class will suffer with this, that they dont have anything in this thats a lie theres a lot for the middle class. Weve sat down with a whole bunch of regular middle class customers. Not the guys that are making 300 plus, judge, the folks making 125, 175, in that general vicinity, which i will call middle class, and they are going to be bringing home more money next year. Now, in certain states where the deductibility of local taxes as well as state income taxes but the president himself sitting around the table yesterday with his cabinet said that the Corporate Tax cut was really the focus. Absolutely it was. Whatever the words were that the president said im not saying the exact words but the point was clear. Thats the same point as to why were wondering how optimistic and positive this can be for stocks because of the 21 corporate rate because of what youre already seeing from at t, our parent company, comcast, and others. Right. Well, the point i think jon is making is if theres a Corporate Tax cut that gives people more money, more salary, more bonuses, whatever, theyll tend to spend it and thats the trickle effect and theres the Multiplier Effect and the market will go up because earnings will go up. The other point that must be put on the table is that markets anticipate you know, markets predict. And weve had a 23 rise in the s p. If you look at history, you look at the last 30 years, there have been seven times where the market has gone up 20 so what happens in the following year what happens whats going to happen in 2018 i was expecting to see more weak markets or slow markets. Seven out of the eight times the market has gone up double digits so it has. And thats you know, i would say and the other time it also went up, it was single digits, so thats a good sign for the market but to suggest its another 20 year, thats just a little pollyannish, i think. Kevin, are we being too pollyannish about this and what it means for investors i want to go back to tonys point about enhancing earnings by 9 in the s p heres my pushback on this once in a lifetime tax change S P Companies on aggregate get about 47 to 49 of their revenues internationally, not subject to 36 tax so on aggregate depending on sector, maybe youre paying 22 , 23 tax. So the real juice in this change isnt going to happen for those companies. I understand accelerating capital costs and all that what im doing is setting a new screen for the First Time Ever in my life to go into companies. And the first screen is whos got 100 of their revenue domestic because theyre going to get the biggest free cash if tony says a 9 lift in earnings for an s p company, how about double that for a small midcap company like a vail resorts, names that have all of their revenue and pay the full 36 tax now down to 21 . If you get a basket of those midcap, small cap names, they will outperform on a percentage basis tonys call for 2018 and thats what im doing. For the first time in my life, screening names ive never even heard of so to that point, to kevins point, how selective do you really need to be . 3,100 tells me i dont have to be that selective. Ultimately kevin is right i think youll get the bigger bang for your buck on the domestic claims. We always come on and make like the data is ours he went through every stock in the s p 500. This wasnt a macro look and happened in 15 minutes looked at what the gross and aftertax rates were before and after, so thank you for that kevin is 100 right. Again, kevin is not arguing that were looking at weakness based on this tax cut, hes looking where theres even better gains than the s p. Of course. And thats the key to this. Everybody wants to feel cautious because were up so much and thats just ultimately over the intermediate term. I cant find data thats say thats the right call. I would be surprised if someone came on and said that they didnt expect the market to do very well over the next year because of not only the improving economy globally, but the tax plan i would be surprised. They dont have to be in sync, the economy and the market im bullish about the economy and i would say im not negative about the market, but saying that you have to be as bullish because the economy is growing is not bell, you have to be 3,100 bullish. Thats not that bullish. Oh, it is i call that very bullish. What if we go into a 1996 and 1997 environment Going Forward we dont have an inversion of the yield curve, credit is on fire, the Global Economy is doing well in 1996 you had increased equities with increased volatility youre going to have corrections not because we havent had them but the fed policy is more unclear. How close youre going to be to an inversion of the yield curve is unclear you have to buy those until credit shuts down. More importantly on focusing on what the price target for the s p is going to be is kevin and carrie are all categorizing an environment that has changed the last couple of years where dispersion is rising and the opportunity for alpha generation is coming back once again. I think kevins points are perfect. Theres an environment if you think theres going to be more volatility, sorry to intercept you no, no, no. It doesnt have to be volatility if you look back where ear this year versus last year, dispersion last year was relatively low relative to this year and thats an environment where volatility has not elevated so this is not about just taking advantage of volatility. This is about doing what kevin is doing and understanding fundamentally where the opportunities are, whether its small, midcap or large cap stocks. You should get both. How selective then do you need to be you always i think you need to be more selective going into 18 than you needed to be going into 17 and more than years prior because i dont think all boats are going to rise that was the environment three or four years ago. Do you agree or disagree, doc . I like materials a ton, judge. I said it yesterday when you asked us, okay, which sector im not negative on tech i like tech just fine. Freeport is a stock weve talked about over and over again for the past month. You had paper in that too. Right unusual activity yesterday, its up another 3 today. Can these keep running like this yes. This one can u. S. Steel it basically just got back to where it was nearly at the beginning of the year and it had a big run. Let me rephrase my question im not suggesting that you go out or even asking whether you should buy every single sector in the s p is going to go straight up. Its more of should you change anything about your strategy of the sectors that have worked, whether its more recently financials have picked up, industrials, we know what they have done, transports are representative of that in some respects, technology why should you change . Why should you dance with someone else instead of who brung you . So youre asking about valuation. Youre asking us if we care about valuation or if the market should care or investors should care yes. The answer is yes, we have to. We look at ebitda ratios you have to look at that otherwise we are not doing our jobs and, therefore, i think you have to be selective the question i think youre asking, does the tax bill change anything, does this economy change anything and i think the methodology we use is similar. The methodology has to be standardized and very exact. I think you do have to change because youve got fed policy. Why, you still like tech . I was neutral tech for most of this year go ahead, im sorry. Your particular view on tech throughout this past year is almost irrelevant. Tech was up 39 . Right. Youre saying that tech is going to continue to work so stay with that. Tech has continued to work. Financials up 21 year to date a lot of that is more recently industrials. You say stay about that industrials. Stay with that. But lets take my opinion out. Lets look at history. When you flatten the yield curve from 60 basis points over the last few cycles, the sectors that outperformed over six an 12 months were banks and info tech and industrials, so those three sectors. Im not trying to figure it out, its been figured out. Im trying to focus on historically what has worked i will tell you when the fed policy is less clear and you had them raising rates and flattening the curve powell is not going to preside over a meeting until march. Right you dont want to overweigh Consumer Discretionary, even though Consumer Discretionary should do better when the fed is raising rates, the performance is better. Every sector is at a new high so you cant say that things are bad. Its relative. An relative you want to be careful. Hold on so amid all of the bullish forecasts, some are wondering if there will be unintended consequences from the massive tax plan it could all play into the market story Going Forward mike santoli writing about that today and joins us from the Stock Exchange michael . Thanks. Youre hitting a lot of the points in the conversation one in particular at the core was a Corporate Tax cut was the centerpiece here and really seems to be the main mover in terms of what it means for the markets. What i was looking at is what i think of as a possibility for rational, recklessness to come out in corporate behavior. If you think about the kind of thesis behind why a lower Corporate Tax rate and these immediate expensing of Capital Investments is meant to boost the economy, its to change corporate behavior in a certain way. Here we are eight and a half years into an economic expansion. You have all these companies that have been resistant and sitting on high hurdle rates for new investments, not seeing attractive returns in Capital Investment and new expansions. Now youre saying for tax reasons, for rational reasons, do that now. Put more capital at risk the question for the markets is, is this the right time to be doing that are those returns going to be attractive is the market going to pay dollar for dollar for the incremental tax savings that falls to the bottom line are there going to be higher Interest Rates that take away from those tax rates all these things are in motion an i think it fits in with the idea of winners and losers in the market and a choppy take you even mentioned tony in your column. Yes, exactly. And the optimism that he brings forth from his earnings estimates being popped up and to what the multiple on the market is going to do to get to the 3,100 that he put today. Yes and i cant argue against it, but i will say that its interesting that the range of forecasts for 2018 earnings, even among those who are trying to account for the tax cuts, the new lower tax rate, range widely we simply dont know look, retailers will be tremendous beneficiaries do you think retailers are in a strategic position to say were going to collect the cash and sit on it or are they going to cut prices, plow more money into their websites and do things that dont necessarily work to the benefit of investors this also gets to karens point about economy versus markets and how that interplay goes over the course of 2018. Rational recklessness is how s santoli tops his piece today. When you can come up with an oxymoron and put it in the headlines no, thats good hes not calling you out, hes using you to represent this optimism and this newfound optimism in some respects. But its not. For some it is. Then maybe that is irrational recklessness my opinion is not relevant. Yes, it is. Come on, it is, it is. How the Global Economy youre so sick of my story, judge. Credit is on fire. Your headwinds have been with us most of this cycle we had a european debt crisis every month going back the last seven years until last year. So was portugese debt down from 14 in 201112, was it a buy or a sell at 5 it was a buy it went down to 2 you cannot predict where the end of this is not going to end well you cannot fix debt with more debt at lower rates. Theres a reason why michael put rational and not irrational at the top of his piece, right right. No one is suggesting that its irrational exuberance, are they no. Maybe they should be, i dont know. I dont think so, because you have the fundamental back grounding. Its not like earnings arent growing and now you have an accounting gimmick and an 8 gain in profits. I look for something that actually works the when t when the ecb decided to buy corporate debt, that changed the Global Economy that put real money into corporate Balance Sheets and cash flow. This puts real money back into the economy on an economy that was doing well now, its going to be a terrible thing ultimately because growth will be too good the fed will be too behind theyll invert the curve and the whole thing will go sideways we are still at least two to three years from that. Michael, thanks for joining appreciate having you as part of the conversation today good read as well. Go to that story cnbc. Com halftime. A lot more ahead on halftime. Straight ahead, the big call on caps. See how high one Analyst Thinks the stock will run the call of the day is next. And later, the call of the year. This analyst said something exactly one year ago when you see how right he was, it will blow your mind thealime hftreport with scott wapner and the traders is back in two minutes all right, welcome back to halftime. Caterpillar hitting a new alltime high today. Its raelds rallied more than 60 this year. It raised its price target 160. Weve made it our call of the day. Is it a good call . Yes, it is. Does it keep going . Its not like it has to jump by leaps and bounds. Its right there. And i think all of us have talked about this over the last year, about the momentum that it was gaining. I know people dont like to categorize the Global Growth story as such but thats what it is. Its undeniable. Caterpillar has significant exposure to that as long as the Global Growth is there, caterpillar will be the clear winner in that environment from a positional standpoint on the mutual fund side, managers turn significantly underweight relative to what they own in caterpillar in years past. You had many that took a very bearish stance on it i think its the right call. I think where its trading as long as Global Growth stays where it is, i think its a good call and i think momentum continues higher. The point on caterpillar, it is a stock thats very close to 160 so its very close to the price target were talking about 6 growth. There are other names in the category deere agriculture will gain from the tax cut. Even if its a nonindustrial, you know, you look at global businesses that are booming. The infrastructure piece might come but i think its the global economies around the world thats fueling this and other global names. And the dollar is still cheap, so youve got that going for you. Youve got demand and full expensing on the new tax bill for heavy well, for any equipment, any buildout. It directly helps Companies Like this. Absolutely. The headwind, judge, could be that if the dollar starts gaining strength quickly, im not anticipating that and virtually nobody is out there saying it, but if that happened, thats a head wind for it because its been a tailwind up till now as the dollar weakened. Kevin, does this make sense to you i like it for a couple of reasons. I like it because youre getting the Global Growth as everybody is pointing out. Institutional investors will take this up to 5 weighting in their mutual funds and holdings, its a call or option call on the infrastructure bill if and when it comes in 18 because this was a goto name. It was only 36 months ago and this was a top short for hedge funds. Boy, did they get slaughtered. This thing is a huge winner and i think will be a 5 weighting i look for names like that those are like banking and i think its very interesting. Its going to be a winner in 18 either way. 63 in a year thats the call of the day wait until you hear what were calling the call of the year it happened exactly one year ago today. Youre going youll be in awe when you see how dead on the analyst was. Hes going to join us live as well to talk about it, see if theres more momentum ahead for a stock he told you one year ago today to buy. Plus he and jon najarian both tracking unusual activity today. Ckn o t ene mehawh wco ba itwminutes. Trust 1 doctor recommended dulcolax. Use dulcolax tablets for gentle dependable relief. Suppositories for relief in minutes. And dulcoease for comfortable relief of hard stools. Dulcolax. Designed for dependable relief. Welcome back to the Halftime Report. Jon najarian checking the Options Market pete joins us from minneapolis doc, well go to you first what do you see today . Judge, weve got first data today, fdc, first data credit card processing and so forth thats what they do. You take a look at this, despite our its bar in the middle. First data is up 33 cents. They were aggressively buying calls in here today. Theyre buying upside calls in january. I believe they bought about 13,000 of those calls very quickly today. I jumped on them, ill be with them in first data. Do you have an update for us too . I do. Last week we talked about discovery communications, disk this one there it is, disck, i dropped the c by accident. Its up 7 today, a lovely pop there you see it moving up last friday through here. Still long it but i sold half of it. Pete, good to see you, bud. What have you got . Good to see you im going to the energy space. We have seen nothing but heavy, heavy activity there as well 50,000 of the june calls were bought about a week or so ago. Yesterday more aggressive buying more again they were buying two different strikes going out to february. Today what were seeing is in the xle. Its a very concentrated index in the energy space. If you put chevron and exxon together, theyre 40 of that index. I know that we just saw that on earlier, but you can see some of the reaction that were seeing already today there. Some huge call buying in that as well today the january 71. 5 calls aggressively bought. 83 cents was the level they were buying those at. Stock was just under 71 at the time of those purchases, so pretty aggressive coming into that, its interesting to see. Thats somebody whos rolling up somebody who made money in there. Theyre selling those but they want more so now theyre in the 71. 5 calls i jumped in there and will probably be in there about a month. Joe, you were talking about some Energy Stocks today that had had a big move lately. Yeah. Some of the names maybe you were talking to francessa about monday. Going back to the conversation you had with jeff y jeffrey gunlock, energy right now, youre seeing flows go into there. There were four names that we felt would be the survivors. That bowing eog, pxd, concho and fang thats Diamond Back EnergyDiamondback Energy has surged. Its above 120 full disclosure, im long in it. I like xle here. I certainly like chevron to get above 125 and i like the significant weighting chevron has there. So this is more of a flow play than anything else i think the positive momentum points in a good direction. Do you have any more disclosures. No. You look at that chart, giddyup, pete im neutral Weight Energy but thats a pretty solid chart on the next month. Pete, you stay with us. Doc, come on back this way lets go over to sue herera who has the headlines for us hi, sue. Thanks, scott heres whats happening at this hour, everyone the United Nations voting overwhelmingly to condemn president trumps recognition of jerusalem as israels capital. The vote was 1289 with 35 abstentions. Palestinian president abbas called it a victory for palestine. A fire killing 28 people and injuring 26 more Officials Say the death toll could rise as rescuers continue to search the building after putting out the fire. Pope francis using a christmas greeting to denounce the cancer, as he put it, of cliques in the vatican and warn bureaucrats can become corrupt by ambition and vanity he delivered the speech to cardinals at the vatican but also acknowledged there were plenty of competent and loyal people who work in the holy see as well. If you own a tesla, porsche or genesis luxury vehicle, you apparently are the happiest car owners in the u. S. Thats according to results from a new Consumer Reports study which ranked brands based on how they performed against buyers expectations youre up to date. Scott, back to you. Coming up next in the blitz, well give you the trades on conagra, walmart, and lemax. The rhythm of the world. But to us, its the pace of tomorrow. With ingenuity, technologies, and markets expertise we create the possible. And when you do that, you dont chase the pace of tomorrow. You set it. Nasdaq. Rewrite tomorrow. Were drowning in information. Where, in all of this, is the stuff that matters . The stakes are so high, your finances, your future. How do you solve this . You dont. You partner with a firm that advises governments and the fortune 500, and, can deliver insight person to person, on what matters to you. Morgan stanley. A wealth of information. A wealth of perspective. A wealth of opportunities. Thats the clarity you get from fidelity wealth management. Straightforward advice, tailored recommendations, taxefficient investing strategies, and a dedicated advisor to help you grow and protect your wealth. Fidelity wealth management. Welcome back its time for the blitz. Conagra is negative despite posting a top and bottom line beat positive guidance as well. This stock is trying to reverse the anythinegative mome they had theyre trying to attract more of the millenial shopper if youre going to get an agricultural type of exposure, you want to go more towards agrium or darling. Doc, maybe the tide has turned on Companies Like finish line the other day Dicks Sporting Goods had an upgrade. Yeah. Samestore sales. Yeah. Their loss was smaller than expected, it was 26 cents versus a 37cent loss but its the fullyear guidance they guide significantly higher. I believe 59 to 67 cents versus a 52 street. Thats some significant upside guidance for them. Walmart is developing a new service to target highend customers. Well, i thought that was a typo at first but then i read it again and i think that walmart has enough benefit from this tax package that theyre going to try many things, this being one of them. I think its a backhanded compliment to them that amazon has got into their space buying whole foods. The chart looks very good. We dont own it but i think its a reasonably good idea right here. What about carmax, pete its down nearly 4 today. Yeah, theyre getting hit pretty hard and not feeling very good for me because im actually long the stock, scott. But the problem, when you look at the used vehicle comps, thats what everybody was focused on i see Earnings Growth of 12 and Revenue Growth of 11 . Those were pretty strong numbers, so i think this is creating an opportunity. I own the stock. I may be adding to it later on today. Fbr is initiating Coverage Today on the toy stocks. Hasbro with a buy. Mattel with a neutral. Scrooge i mean santa i mean mr. Wonderful i figure if im doing toy stocks i have to be santa. I dont own either of them hasbro has the star wars license which its benefitting from mattel is actually avoid with extreme prejudice. I think its a sell. Their Balance Sheet is a mess. I think the company will breach debt covenants in 2018 theres a rumor that hasbro would buy it, i dont think so maybe private equity steps in, but it is a bad situation. Tony dwyer they have been naughty they have been naughty. My call of the day is he looks damn good in that hat. The transports to me you could pull that off if he can. For obvious reasons, right . What do you mean . I join the party. What are you talking about . So transports have had a heck of a run and way better than expected Economic News the index has gone to a historic high from a historic low earlier this year. Youre probably going to see a little bit of a pause or correction there i urge you to look through it. Again, industrials should be the best performing space and transports with them as you look through 2018. All right pete, thanks for coming on well see you next week and i think youll be in the house and we look forward. Appreciate it. Be well. Next call of the year. We have the analyst who said this stock was going to soar exactly one year ago today, and since then it is up more than 90 . Well tell you what iits, next. The Halftime Report is back in two minutes. It can detect a threat using ai, and respond 60 times faster. It lets you know where your data lives, down to the very server. It keeps your insights from prying eyes, so theyre used by no one else but you. It. Is. The cloud. The ibm cloud. The cloud thats designed for your data. Ai ready. Secure to the core. The ibm cloud is the cloud for business. Yours. So how old do you want uhh, i was thinking around 70. Alright, and before that . You mean after that . No, im talking before that. Do you have things you want to do before you retire . Oh yeah sure. Ok, like what . But i thought we were supposed to be talking about investing for retirement . Were absolutely doing that. But theres no law you cant make the most of today. What do you want to do . Id really like to run with the bulls. Wow. Yea. Hope youre fast. I am. Get a portfolio that works for you now and as your needs change. Investment Management Services from td ameritrade. Welcome back to the Halftime Report. Im phil lebeau live at the Bombardier C Series plant in canada let me give you an update on the headlines crossing between boeing and embraer boeing has held takeover talks with embraer it would need brazilian government approval because the brazilian government holds a golden chair and could veto any proposed takeover. Boeing is willing to structure a deal to assuage any concerns that the brazilian government may have shares of embraer are up more than 20 following the report of this potential takeover deal why . Because of the premium and the price that boeing might be willing to pay meanwhile shares of boeing slightly lower not a big drop why would boeing want to make this deal . Because in the lower end regional jet part of the market, it really doesnt have much to offer in that segment. Its competitor, airbus, has structured a deal so that it takes over the c series, which was introduced and built originally here by bombardier. Theyll have a new plant in alabama. It should be interesting to see what happens we have reached out to embraer and boeing Neither Company is commenting about these reports. Back to you. Phil, thank you very much phil lebeau. We include an analyst call of the day every show but with the year winding down, we thought it would be fun to single out a few calls of the year, ones that really hit the mark today we highlight boeing. Seaport globals Josh Sullivan anywheinitiated on that stock wa buying rating a year ago today when shares were 156. He said it was well positioned for a takeoff and it certainly proved that. Boeing is the dows best performer in 2017, up 90 year to date. Josh joins us now. Josh, welcome. Its good to have you on. Thank you. Great, great call how did you know you know, going into early 17, late 16, aerospace was a pretty underloved arena. You were looking at the order cycle coming to an ending, potential issues with wide bodies, questions over whether boeing Global Services was really going to play out really all three of those bear points proved false over the year really you get back to Passenger Air traffic growth whats the fundamental driver of the need for aircraft . Its the growth of people wanting to fly on airplanes. So coming into 17, we had both the lower fuel costs as well as increased city pairs that big infrastructure bill weve heard about over all these years was finally coming to fruition and that has the effect of lowering the cost of air travel so globally air travel was accelerating double digits we were looking at those trends and fears didnt materialize so the Paris Air Show midway through the year, we saw hundreds of orders for boeing 73710 max that got launched the 787 on the wide body front, boeing increased production. And then the Free Cash Flow generation has been off the chart. So boeing returning that to shareholders has been a big beneficiary to the stock and shareholders. The puns are unavoidable. How much runway is left . Any turbulence . The argument is that you look at boeing on an eps basis and the multiple, you know, differential between some of the other stocks isnt that attractive but we think that doesnt capture the lens of a price to Free Cash Flow basis. Boeing still has a lot of runway there. Theyre trading four or five turns below ge, honeywell, large industrials in aerospace given boeing is just on the beginning of this ramp, we can argue that its actually undervalued. So looking at the 737 going up in production again next year. Boeing Global Services, they set a pretty low bar for they took a lot of costs this year we think boeing sets up good for 20 a 2018. What about the embraer talks . Obviously theyre pretty preliminary. Boeing was probably just exploring some options given that airbus had taken such a big stake in the c series. Boeing is pretty confident in case with the c series but given that they didnt have an aircraft in that portion of the market, the embraer e2 is a great aircraft and would give them access to an important reginald market. Its pretty early, of course, but the mere fact theyre talking, that acquisition you think would make strategic sense for boeing in the context of airbus ownering the c series. If the c series is going to be a successful airplane globally theres a trade case here in the u. S. , boeing would want to have an asset in that portion of the market and then there is a conversation around airlines unions, what size aircraft you can actually fly into some airports if those rules do get changed, then an aircraft some airports if the rules are changed the aircraft in the 150 to 150c category could become more popular. Theres no indication but another level boeing would want access to. And shark tanks kevin oleary is with us today you own the stock, kevin one of the reasons being joshs call it is joshal cal ajoshs cal. I remember having the conversation after steve mccall how boeing was moving beyond building cattle cars in the sky. They had a services business, and all the avionics, technology you buy when you buy an aircraft and they charge for that an extremely high margin, perpetual and growing and got me fascinated he got me into this stock in late december and early january and its been my best performer. By the way, i made it my stock pick for the cnbc stock contest and i think im kicking heinie against everybody else very good i mean, thats part of boeing changing into a new Technology Company and breaking that cyclical play. Why its still at a discount others can argue, but as boeing gets deeper into Global Services, analytics, it will continue to move north. Done everything but raise the price target and were basically there. We can expect that in the weeks ahead . Well be releasing our 2018 shortly and update you then. Do it on this show i hope well have you back. Good holiday congrats on this call. Thank you. And Josh Sullivan copper prices eiseng strong gains. Well go to the futures picks next for those trades. Back after this. [vo] progress is an unstoppable force. The season of audi sales event is here. Audi will cover your first months lease payment on select models during the season of audi sales event. Welcome back to the Halftime Report. Im Jackie Deangelis we are watching copper rallying for a 12th session pacing for as long a daily winning streak in as little as over a year what do you make of this all the harmarks of somebody accumulating a big position. Now the best performing base metal. Up 47 for the year. All over it on futures why . The demand story is obvious. The supply story is interesting as china is starting to screen supply as they shut down the worst polluting shelters thats what were seeing. What levels are you watching . Yeah, jackie. Resistance at 320. Above all major moving averages at this point. A little resistance at 320 not at 320 since scott mentioned demand factor. That continues with at t and verizon wanting to upgrade networks thats copper. Vehicle sales, 2 of new car sales in 2020, and youre looking at 400,000 more tons of copper for that. Demand for copper looks like its going straight up and scott mentioned the supply situation i think the price goes much higher from here. Thanks. On the live show joined by w ts stico scott wren to tell ushyhihioral market has legs all at the top of the hour Halftime Report is back with final trade next this is where i trade andrs. Manage my portfolio. Since i added futures, i have access to the oil markets and gold markets. Okay. Im plugged into equities trade confirmed and i have Global Access 24 7. Meaning i can do what i need to do, then i can focus on what i want to do. Visit learnfuturestoday. Com to see what adding futures can do for you. For every hour that youre idling in your car, youre sending about half a gallon of gasoline up in the air. That amounts, over the course of the week, to about 10 pounds of carbon dioxide. Growth is good, but when it starts impacting our quality of air and quality of life, thats a problem. So forwardthinking cities like sacramento are investing in streets that are smarter and greener. The solution was right under our feet. Asphalt. Or to be more precise, intelligent asphalt. By embedding sensors into the pavement, as well as installing cameras on traffic lights, we will be able to analyze the flow of traffic. That data runs across our network and we use it to optimize the timing of lights, so that traffic flows easier and travel times are shorter. Who knew asphalt could help save the environment . Were back its time for final trades. Joseph it has been a stock we really had to be patient. Duncan brands. Had it a while but its breaking out. Finally coming back. Seeing momentum into the name. A good earnings now seeing analysts upgrade and the price target, 68, 69 in cases. Staying with it. The doctor . Aggressively buying 120 calls and selling 115s somebody, scott, defining the range 110 to 115, aggressively buying those calls today. And showing dominance. Mentioned it yesterday. I like it dominant. Many derivatives and commodities, first to do bitcoin, not that i like it, but more volatility helps. Sounds like you like bitcoin. Yes do you . Cant say oh wow. Ridiculous. I two things number one, i would buy any dip that you get on a news on the dip on the tax legislation overweight consumption of food at the Holiday Party tonight all right see if thats a call of the year and morgan stanley, apple, top picks . Like that. Oh, yeah. Of course. Favorite. Tony, thanks for being here. Merry christmas happy holiday. Power lunch starts now. Sounds like buy the dip and be in the dip tonight. Have a good time. Companies from boeing to banks to at t announcing everything from bonuses to Capital Investments even a hike in the minimum wage following the passing of the tax bill. Its good for employee, but is it more about political optics than anything else call it the high s. A. L. T. Diet keeping state and local tax deductions, breaking down those ideas. And help wanted or not