Commuters, but the earnings may be tough this morning. Futures as you can see are mixed as have the averages been over the past several days. The tenyear note a touch higher than it was at this time yesterday. And as for europe some mild weakness in the uk and in spain. Our roadmap this morning goes, well start with coach. Shares of the luxury goods maker down big in the premarket after samestore sales in north america plunges 13 year on year. And ibm is not looking too good. Down on earnings. The tech giant reporting revenue below estimates for the Fourth Quarter in a row and due to weakening demand in part in emerging markets. A lot of people facing a nasty commute after a massive winter storm dumped over a foot of snow across the northeast. Left temperatures hovering near zero. Well go live on the ground to see just how bad things are in a moment. But first up, coach reporting weakerthanexpected fiscal Third Quarter results and comps down 13. 6, and it said its been hurt by substantially lower traffic in its stores and coach has been losing share in the handbag business to rivals including michael kors. The only bright side here was some international up 11 and china up 25 but north america is a source of pain. Really scrambling on this one. Down 14. I hate to ever make an analogy to a company that we all hate. Because they told us that things were fine and then they raised capital. But this has a jcpenney feel to it. Now, its got a much better Balance Sheet to it. But when you start seeing double digit comp declines, those are very hard to stem. When we first saw the double digit comp declines at jcpenney it was the time to go. Im not saying that coach is in trouble. I am saying that this not a buying opportunity. Yeah. Korss, tory burch, kate spade, theres a bevy of competitors who have already begun to eat their lunch and are ready to start doing so. Kors has been a weak stock of late. I actually think that kors is not as bad. Kors has been its this is one of those situations where coach was really bad and we expected bad. I just wonder, we expect great things from kors and maybe its really good. In this market you have to expect bad things and then get blown away by how good things are. Thats whats moving stocks which baker used oddly, i know it doesnt mix with handbags. You can if you want it to. Use coach. Thats the one if you want to look, Norfolk Southern and baker news are the two i expected the least of. They were giddy on the call. Are you optimistic . Im very optimistic Norfolk Southern and baker he r hughes are the templates of what are using. I thought you were screwing up but theyre not. The ceo has not been there that long, right . The new ceo of coach. Coach, lou frankfurt having run the company for so many years. Hes new. I dont know. I wonder, though, if theres something, you know, when you have a change of that significance. I dont know. In leadership. Maybe hes setting the barlow. Yeah. Extremely low. Is it more about coach or is it more about the consumer overall . You mentioned many of the other competitors and carl did that are succeeding it would seem in beating them. Yeah. I think that coach is lets say half of it is traffic. No one really expected, again, thats u. P. S. Call, like, how could u. P. S. Have its peak week the last week and thats because mall traffic is down. Coach has been adept at telling you, listen, were a china story. That aint cutting it anymore. Theres just a lot of u. S. Stores, theyre overstored. They have the wrong price point. The shoe incentive that i thought was working so well a year ago obviously seems to have petered out. I just dont understand how a company could go from first to worst in a rather, you know, kind of an amazing time. It does bring to mind a couple other in this case downgrades of dollar tree, for instance, stern cutting it to a neutral, saying it worked beautifully for a while, but they are looking at some deterioration in trends. Right. Home meet iheats bills that think might hurt Consumer Spending in the spring. Thats a great point you mentioned. Natural gas stocks really exploded yesterday and they exploded because, almost, listen, we accept the fact that theres a change here that the 3 level is no longer the effective level. The 4 level is now effective. It had been a savings of 700 per family when we were down at the 3 level and that money is going somewhere. The cuts have gone somewhere. Family dollar did not have a got quarter and that stays in there but thats activists. Family dollar theres a lot of noise around that name. Not sure what you can point to. All of it around the idea that they would be better off being a part of Dollar General who are considered better operators. Whether or not that happens. Meetings pass, but you cant act by writ consent. Youll see. But you have shareholder basis in Family Dollar nelson peltz, paulson. And lone pine might not be in there. Lone pine. But you got a lot of names in there. Dollar tree is a better operator. But i think theres a big question of where the shoppers are and one of the reasons why identii think theres been Good Movement in the industrial stocks because they have nothing to do with the consumer. Meanwhile, rates have paused. What was that thing they were talking about when the feds done . What was that thing . I dont remember. I dont know. Its not coming to me yet. Ten year in 2. 8. Whats the best performing group . Utilities, the Master Limited partnerships, the ryr, the real estate trust. And they are doing a great job. Its great read. But where whats working isnt supposed to be working. Just not. Alcoa. Especially i. T. Hardware in some occasions. Yes, indeed, a good way to get to ibm. Good segue. Were good here. They missed revenue expectations for a Fourth Quarter in a row. Weakening demand for servers and storage equipment especially in markets such as china and the ceo says she and her senior team will forgo their annual incentive payments for 2013. Not sure thats going to go that far to helping assuage investors. Its a start. Hey, its a start. Its something. You have a focus that the bottom line number was not bad but they beat because of a tax rate, a lower tax rate, i think 70 cents a share. You know, Stan Druckenmiller has been talking about a short on this name with the simple idea being that Big Companies when their Business Model changes, its not easy for them to change as well. Or as quickly as perhaps they need to. They did put out that big 20 and 20. Theyve got this formula, roadmap, i know that Warren Buffett seemed to be attracted to the roadmap. Are you talking about operating net for the year, they are supposed to see 20 bucks . Yes. If people want to understand why companies go down even though the headlines are good, theyve got to go through this transcript of the Conference Call because its really rather remarkable. At one point the analysts didnt turn on the company yet until the research. That will happen next, but at one point theres this, guys, what are you really earning . The strongest point in the call they managed to get the tax rate down and they did well on pensions and then theres a listen, were a mobile, were a social, were a cloud, were a watson company. They didnt do as much as salesforce. Com did. This is a i dont want to say its a disaster, but i am going to say when you make these longterm targets and what david said the business changes, when you make the longterm targets and youre down an astounding amount in china, i mean, you know, at one point they even say, look, china, were being were selling into these stateowned organizations. These companies. And they are the real weakness. This is the cash flows down really badly. This is bad. I dont know if its akin to the personal computer but there is a change going on here and they believe its a seminal change and one theyre going to have to deal with for quite some time and adjust to. The rap you saw on some of the most critical analysts this morning say, the last bad quarter coming up. Theres a hardware cycle and it worked for oracle. The mainframe business, i dont know. Its down in numbers. 15 billion in cash flow. Thats 3 billion lighter than they thought. Yeah. Revenues down five. The roadmap in tatters. The roadmap is in tatters here. The isis out with a report saying they need to do some very large m a even if its dilutive in the first two years and Herb Greenberg has a provocative tweet saying investors are getting tired of managed earnings. I read herbs article. He said when you make the longterm targets you run the risk of making major misses but you do everything you can to make the number. China down 23 . Whats that about . The Stateowned Enterprises they say, like, its in turmoil. Heres my favorite line, we had good performance in our pension plan. Oh. Thats always a good thing. A highlight. A highlight. Thank you, ben bernanke. A real reason to go out and buy the stock. I got to take that. 4. 4 billion in cloud and including 1. 7 billion in software and services. I mean, no, they are not mobile, they are not social, they are not cloud and then theres the watson element. I dont want to pick on them too much but i want to pick on them a lot. But they have Free Cash Flow of 8. 4 billion, an enormous company in the midst of change. On the buyback point, dennis berman, interesting piece about how buybacks have ruled the day at ibm for so long. I think its 60 billion in stock has been bought back. Theyve redued their share count by over half, over not that long a period of time. Buybacks are a key to the strategy for this company. And he posits this theory, do they love it or hate it by doing this because they dont want to reinvest as much. Warren buffett likes the buyback. Buffett is the larkest shareholder here and hes in a tremendous position. Although another piece by jim chanos and how buybacks disguise weak Business Models and thats given him an entree in the shorts this past year. Oppenheimer cuts oracle to neutral because they think in the future the most strategic cloud providers are amazon and red hat. Piper raises the price target. The Charitable Trust owns red hat. Two quarters ago was so hated that Jim Whitehurst was bemoaning onham. Why do they hate me . They were wrong to hate him. It was issue that some of the companies when they do software as service, you have to prorate the billings. Its a subscription model and ibm would kill for that model so people are confused how to value these. Salesforce. Com has been going up, up, up. S. A. P. Pushback and profitable because of cloud. Cloud is eviscerating ibm i believe. But it does have the cash flow and it will continue to buy back. They will make those numbers because they continue to buy back. But if you go over the Conference Call the analysts the tax rate goes down and your pension fund is doing better is not what they want to hear. Very good at matching the tax rate. The analysts are so skeptical. They are talking about how its possible that you get to 13 growth plus earnings per share growth in a normalized tax rate environment . But who knows what a normalized tax rate environment is . I mean, these guys are like the old, im going to say it, ge, which was tax rate. You play the people see through it. This is a bad quarter. With all that in mind, a lot of diggings on tap today for much of the east coast after that winter storm dumped more than a foot of snow in parts of the region which is also dealing with bitter cold temperatures today. Lets check in with jim cantore in washington. Good morning. Reporter good morning, i hear cramer make all these projections. Looking ahead we like to look ahead five, ten, 15 days if you are east of the rockies do not expect much relief from the cold at all. I mean, it is going to last right through the end of the month. Probably right through the super bowl as well especially great lakes and northeast. Theyre just locked in right now with the snowpack and the cold. But heres the first arctic blast. We are not going to touch 45 degrees over the next seven days we wont touch it. We may get to 32, 34 degrees as we get into saturday but thats it. Well just get above freezing a little bit and, of course, anytime you get one of these snowstorms you will have delays with air travel, buses, cars, of course, they usually have four or five lanes to deal with and only a couple to go with and thats the case here today. Delay for the federal offices once again, so thats about 2 1 2 days. We only got twohour delay instead of all closed. City schools are closed as you might imagine and the airlines will take a couple of days to get back up and running because of the cancellations yesterday. Not getting the air traffic in means we have no planes to get out, so a lot of the departure delays and cancellations are what we are dealing with this morning. Surely but surely it will be getting back online the next couple of days but if you are heading up this way, bring a very, very large and thick coat. It is cold and its going to stay that way. Guys, back to you. Thanks a lot, jim cantore. We used to sell the airlines things like that. Printing money. Printing money, delta. Miami 65 degrees and sunny. Getting on a plane. The western part of the country is just fine. Well, i dont know what to say. I was more focused on earnings, but im perfectly willing to go. How about squawk on the street in miami today . Yeah, they got streets. Oh, man, i would do that in a flash. My street was plowed very well. Brooklyn. In brooklyn. Mayor from brooklyn. De blasios new york. When we come back the earnings parade marches on. Well dig deeper into the results from United Technologies and Texas Instruments and a lot more. Also ahead s. A. P. s Bill Mcdermott their big bet on the cloud. One more look at futures as the market tries to wrestle with some of the challenges bits of guidance and earnings from major companies. A lot more squawk on the street from post nine in a moment. [ male announcer ] this is the story of the little room over the pizza place on Chestnut Street the modest first floor bedroom in tallinn, estonia and the southbound bus barreling down i95. This magic moment it is the story of where every great idea begins. And of those who believed they had the power to do more. Dell is honored to be part of some of the worlds great stories. That began much the same way ours did. In a little dorm room 2713. This magic moment tell me what you want tell me what you want a lot more earnings to go through this morning. United technologies and xilinx above estimates. And textron gave a cautious outlook for the First Quarter and txn announcing plans to cut 1,100 jobs in an effort to cut costs. It seems like everyone that beat on the bottom line had some negative piece of news to go along with it. Utx ten quarters of a revenue miss. People looking outside are looking at orders are for utx and extrapolating what boeing was saying, United Technology had great orders and a lot of people feel that commercial real estate is coming back. Otis and hvac, i think the stock will go higher. They did tell you that defense was a problem and United Technologies is the best of the dow stocks that have reported. Look, theres holes everywhere. I mean, yesterday i thought travelers had a really great number, but they mentioned competition at one point in pnc, in property, casualty and that was it. You mentioned competition. If you mention competition your stocks going down. If you dont lets back up a bit from earnings to earnings and a look at the market overall. Does it change your viewpoint . No. Do you start to reassess a bit given what weve been seeing . No. Because i think that its at a certain point the consumer stocks will have overcorrected, at a certain point well be saying, do you know what, this year doesnt look as bad because the banks are doing so well and i always like the banks. I see enough good in the industrials particularly in europe. I keep hearing that europe, the leverage there is going to go over the ppg quarter last week and what he said was basically, that europe has turned up just enough and they fired so many people in europe. Alcoa turned up just enough, they fired so many people, so youll get real leverage out of europe with the industrials and i think thats whats driving a lot. Interesting. Sort of is reminiscent of what Howard Schultz told us about the consumer in europe a very long time ago, right . Right. You think this is the second stage of that . Yes. Look for bargains in europe, but looking for real growth there, you may be looking awfully long and hard. I think its bad versus not as bad. I think you are talking about a company that might have had a 2 decline versus the 2 sales increase because of the firings you get a kind of a v. You get a v up in the earnings. Its not what people want. People want to see amazon. I mean, amazon has something today, they obviously contacted a couple of Media Companies and the next thing you know amazons got a channel and you tick up amazon 10 because it has a channel. They have revenue growth. The story is, right, and actually denialed to a certain extent by an amazon spokesperson that amazon was contacting broadcasters in the broad sense of the word or providers of content about doing an overthetop kind of thing could we have an online version of your channel which is very precarious for those selling the channels to the cable providers, of course, and getting a fee every month. A day where netflix is posting tonight, right . Need to see 33 million. 33 . Domestic . Yes. Goldman today said facebook numbers have upside. Thats another one of these where i think people just say, you know, look we like the growth. We like the growth. We like the growth. And anytime you see that they like the Growth Without any concern, they better have real growth or the stock gets hurt. I think facebook does have it, though. When we come back well get cramer mad dash. Xilinx on mad money, as we count down to the opening bell, one more lo