Business

Disney defended CEO Bob Iger as it pushed back on activist investor Nelson Peltz’s bid for a seat on its board.
Disney responded that Peltz has “no track record” with large media companies, after Peltz and his firm, Trian, initiated a proxy battle.
Peltz laid out his case for the Disney proxy fight Thursday, claiming shareholder value has been eroded and raising issues with the Fox acquisition.

Nelson Peltz
David A. Grogan | CNBC

Disney ripped Nelson Peltz and his bid for a board seat Tuesday, as the entertainment giant’s proxy fight with the investor and his activist firm, Trian Fund Management, takes shape.
Disney said in a securities filing Tuesday that its board was where it needed to be to move the company forward. The company also defended CEO Bob Iger’s past acquisitions and said Peltz didn’t have an understanding of Disney’s business, lacked the skills to drive shareholder value and presented no strategy.

“Peltz has no track record in large cap media or tech, no solutions to offer for the evolving media landscape,” Disney said in an investor presentation released Tuesday.

On Thursday, Peltz laid out his case for a proxy fight with Disney on CNBC’s “Squawk on the Street” after Trian filed a preliminary proxy statement looking for a seat on the board.
Peltz raised issues with how shareholder value has eroded recently and Disney’s $71 billion acquisition of Fox in 2019. Trian has also criticized what it called poor corporate governance, including failed succession planning and Disney’s lack of engagement with Trian in recent months.
A representative for Trian declined to comment Tuesday.
Trian said it owns about 9.4 million shares valued at roughly $900 million, which it accumulated months ago.

Disney preempted and opposed Trian on Wednesday when it announced that Mark Parker, the executive chairman of Nike, would become the new chairman of the board.
In Tuesday’s filing, the company defended the numerous acquisitions closed under now-returned CEO Iger, including Marvel and Lucasfilm, saying they enhanced the company’s value for shareholders and were transformative for the company.
Disney’s portfolio has meant it’s often led in the box office with Marvel films and “Star Wars” installments. Those assets have also provided much of the content for its marquee streaming service, Disney+.
As for its Fox acquisition, which Peltz took particular issue with in his presentation Thursday, Disney said Fox has broadened its intellectual property portfolio further and provided the company with a “deep bench” of talent, including Dana Walden, who’s been considered a contender as the next leader of the company.
When Iger made his shocking return to Disney’s helm in November — replacing his hand-picked successor, Bob Chapek, after a poor earnings report — he said he would stay for only two years to help look for his next successor. Newly appointed board chairman Parker will lead the process of finding a new CEO, the company said Wednesday.
Disney noted Tuesday that in addition to succession planning, it is in the midst of a cost-cutting plan and prioritizing streaming profitability.
Disney’s stock was rocky in 2022 as it came out of the early days of the pandemic when movie theaters and theme parks were closed. Slowing streaming subscriber growth also weighed on media stocks in the past year.
Peltz said on CNBC on Thursday he’s been pushing for a board seat to get access to internal numbers and tell other members if and when they’re missing out on opportunities.
Disney on Tuesday contested some of Peltz’s claims about the parties’ conversations thus far.
The company said it had offered Peltz an information-sharing agreement, meaning he would have met quarterly with both management and the board, rather than a board observer role, as Peltz had said. Otherwise, Disney pointed to numerous interactions between the company and Trian.
— CNBC’s David Faber contributed to this report.

WATCH LIVEWATCH IN THE APP More

There’s still time to avoid a penalty for fourth-quarter estimated taxes — but the clock is ticking.
If you’re self-employed, receive income from gig economy work, investments and more, the deadline for fourth-quarter estimated taxes is Jan. 17.
You can bypass a penalty by paying the lesser of 90% of taxes for 2022 or 100% of 2021 levies if your adjusted gross income is less than $150,000.

Constantine Johnny | Moment | Getty Images

There’s still time to avoid a penalty if you didn’t pay enough taxes in 2022 — but the clock is ticking.
If you are self-employed or receive income from gig economy work, investments and more, the deadline for your 2022 fourth-quarter estimated tax payment is Jan. 17.

Your payment may reduce your 2022 tax bill and bypass extra penalties and interest, according to financial experts.
More from Personal Finance:Tax season opens for individual filers on Jan. 23, says IRSHere are 3 key moves to make before the 2023 tax filing season opensAfter ‘misery’ for tax filers in 2022, IRS to start 2023 tax season stronger, taxpayer advocate says
“It’s where you can make yourself whole at the end of the year,” said certified financial planner John Chichester Jr., founder and CEO of Chichester Financial Group in Phoenix.
If you’re not withholding taxes from your income, you typically must make payments four times per year. Otherwise, you may owe interest and a late-payment penalty of 0.5% of your unpaid balance per month or partial month, up to 25%. 
The IRS says Direct Pay is the “fastest and easiest” way to make payments. You can also make payments through your IRS online account, which provides access to payment history, or digitally through the Electronic Federal Tax Payment System. You can see other options through the IRS payments website. 

This season, the IRS will begin accepting individual tax returns on Jan. 23. The federal tax deadline is April 18 for most filers.

Know the ‘safe harbor’ to avoid federal tax penalties

One key thing to know: Chichester said there’s a “safe harbor” to avoid underpayment penalties for your yearly federal taxes.
You won’t owe federal penalties if you’ve paid, over the course of 2022 and through the Jan. 17 deadline, the lesser of 90% of your 2022 taxes or 100% of your 2021 bill if your adjusted gross income is $150,000 or less. (Opt for the latter strategy, and you’ll need 110% of your 2021 bill if you earn more than $150,000.)
However, the safe harbor isn’t a guarantee you won’t owe more federal taxes for 2022, Chichester said. He urges clients to set aside at least 20% of earnings to cover federal taxes, plus a smaller percentage for state taxes, depending on where they live.

WATCH LIVEWATCH IN THE APP More

We are initiating a position in Caterpillar (CAT), buying 55 shares at roughly $257.86 apiece. In addition, we are selling 50 shares of Starbucks (SBUX) at roughly $106.87 a share. Following Tuesday’s trades, Jim Cramer’s Charitable Trust will own 55 shares of CAT, starting its weighting in the portfolio at about 0.5%, and 700 shares of SBUX, decreasing its weighting in the portfolio to 2.58% from 2.76%. We’re intentionally starting our Caterpillar position on the smaller side due to the big moves the stock and the broader market have made recently. We have a war chest of capital right now thanks to our recent sales in high-multiple tech stocks . This new addition will increase our holdings of stocks that trade at reasonable price-to-earnings multiples and have long-term track records of dividends and buybacks. And we’re also looking to invest in companies, like Caterpillar, that are expected to benefit from a flood of federal infrastructure funds over the coming years. If CAT, or the broader market, cools in the weeks ahead, our large cash position will shield us from downside and we’ll put it to good work by steadily buying more shares into weakness. Texas-based Caterpillar is the world’s leading manufacturer of construction and mining equipment, off-highway diesel and natural gas engines, industrial gas turbines and diesel-electric locomotives. Caterpillar’s business is divided into three main segments – construction, resources, and energy and transportation. Within its construction unit, nonresidential makes up about 75% of the segment. We think this part of the business could strengthen over the next few years in the U.S. as a result of the federal government’s $1 trillion infrastructure spending law that President Biden signed last year. Caterpillar’s manufacturing operations should also benefit from government spending in connection with the Inflation Reduction Act and the Chips and Science Act , both enacted last year. Infrastructure and manufacturing projects should start showing up in CAT’s numbers and backlog in the second half of 2023 and into 2024. Regarding its resources division, commodity prices have come off their highs but remain at prices supportive of continued investment. The reopening of China’s economy should further support the commodity outlook this year. At the energy and transportation unit, Caterpillar’s oil-and-gas part business is currently seeing a lot of strength in reciprocating engine orders and solar turbines. Although its oil-and-gas production remains disciplined, Caterpillar points out that even maintaining production levels requires a certain amount of continued investment. CAT .SPX 1Y mountain Caterpillar (CAT) shares vs. S & P 500 (.SPX) The stock was a strong outperformer in 2022, gaining roughly 16% compared to the S & P 500 ‘s decline of around 19%, yet its price-to-earnings multiple still looks very reasonable to us. CAT currently trades at about 17-times its expected fiscal 2023 earnings-per-share consensus estimate of $15.32, which is up from estimates of $13.94 a share for fiscal 2022. Those earnings are supported by a robust backlog (about $30 billion at the end of the third quarter), strong pricing gains (up 14% year-over-year in the third quarter), and easing costs for raw materials. Looking out to fiscal 2024, consensus estimates are for earnings-per-share of $16.82, which would represent growth of about 10% year-over-year. And we expect those earnings estimates to be revised higher later this year as infrastructure spending kicks in. On capital returns, Caterpillar has a strong track record of returning cash to shareholders. It’s a dividend aristocrat, thanks to its 28 consecutive years of increasing its annual divided payment. The company increased its divided by 8% last June, and its current yield is about 1.7%. Caterpillar has also steadily repurchased its stock. The company announced a $15 billion share-repurchase program last May, and as of Sept. 30, CAT had approximately $13.7 billion remaining under this authorization. We are initiating our CAT position with a price target of $285 per share, about 10% higher than current levels, representing roughly 18.5-times fiscal year 2023 earnings-per-share consensus estimates, a slight premium on the S & P 500, which trades at around 17-times next year’s earnings. SBUX 1Y mountain Starbucks (SBUX) shares 1-year performance As for Starbucks , this small trim is consistent with our strategy of taking profits following the coffeemaker’s big run. Reinvigorated storefronts and an ambitious growth strategy in China mean there is a lot to like about Starbucks’ future, but the recent rally means a lot of that good news has started to get priced in. Shares are now trading at around 31-times the next 12 months’ earnings. The higher multiple is justified, but it also raises the stakes around execution. Out of prudence and general discipline after a large run, we’ll take some shares off and lock in a solid gain of about 26% on stock purchased in August . (Jim Cramer’s Charitable Trust is long CAT, SBUX. See here for a full list of the stocks.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust’s portfolio. If Jim has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade. THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY , TOGETHER WITH OUR DISCLAIMER . NO FIDUCIARY OBLIGATION OR DUTY EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTING CLUB. NO SPECIFIC OUTCOME OR PROFIT IS GUARANTEED.

Ty Wright | Bloomberg | Getty Images More

“For the last 18 months we’ve seen extraordinary input cost pressure … it runs across petrochemical derived products, agricultural derived products, energy, transport, logistics,” CEO Alan Jope tells CNBC.
Unilever has a global footprint and owns brands including Ben & Jerry’s, Magnum and Wall’s.
“We might be, at the moment, around peak inflation, but probably not peak prices,” Jope says.
“There’s further pricing to come through, but the rate of price increases is probably peaking around now.”

Unilever CEO Alan Jope photographed at the World Economic Forum in May 2022.
Hollie Adams | Bloomberg | Getty Images

The CEO of consumer goods giant Unilever said Tuesday that prices would likely continue to rise in the near term, adding that his firm had a playbook for high inflation thanks to its business dealings in markets like Argentina and Turkey.
Speaking to CNBC’s Joumanna Bercetche at the World Economic Forum in Davos, Switzerland, Alan Jope talked about how his firm was managing its operations in the current climate.

“For the last 18 months we’ve seen extraordinary input cost pressure … it runs across petrochemical derived products, agricultural derived products, energy, transport, logistics,” he said.
“It’s been feeding through for quite some time now and we’ve been accelerating the rate of price increases that we’ve had to put into the market,” he added.
“So far, the consumer response in terms of volume softness has been very muted, the consumer has been very resilient,” Jope said.
“We do see the prospect of higher volume elasticity as winter energy costs hit, as households’ savings levels come down and that buffer goes away and as prices continue to rise,” he said.

Last October, Unilever published its third-quarter results for 2022, with the firm reporting price growth of 12.5%.  

Jope was asked if he foresaw any moderation when it came to inflationary pressures. “It’s very hard to predict the future of commodity markets,” he replied.
“Even if you press the oil major CEOs, they’ll be a little cagey on giving an outlook on energy prices.”
Unilever’s view, he said, was that “we know for sure there’s more inflationary pressure coming through in our input costs.”
“We might be, at the moment, around peak inflation, but probably not peak prices,” he went on to state.
“There’s further pricing to come through, but the rate of price increases is probably peaking around now.”

Stock picks and investing trends from CNBC Pro:

Unilever has a global footprint and owns brands including Ben & Jerry’s, Magnum and Wall’s.
During his interview with CNBC, Jope touched upon the international dimension of his business and how the experience of operating in a range of markets was steering it through the current climate.  
“Nobody running a business at the moment has really lived through global inflation, it’s a long time since we’ve had global inflation,” he said.
“But we’re used to high levels of inflation from doing business in places like Argentina, or Turkey, or parts of Southeast Asia,” he added.
“So we do have a playbook, and the playbook is that it’s important to protect the shape of the P&L by landing price.”
“And so it’s not that we’ve taken more price, we just started acting earlier than many of our peers, and the guidance that we’ve been getting from our investors is they support that and feel that that’s an appropriate action.”  
This, Jope explained, was “something we have learned from being in these high inflationary markets, though … much of that inflation is currency weakness, historically.”
“But now those markets are having to deal with the combination of commodity pressure and currency weakness. So our instinct is to act quickly when costs start coming through.” More

The world’s largest automaker, Toyota, is battling criticism it is behind rivals on electric vehicles, and is even working to try and block the transition to zero-emission electric fleets.
But the automaker says it does believe in an all-electric future. It just maintains that future will not reach all of Toyota’s markets at the same time.

Toyota was once considered a green vehicle pioneer. It introduced the Prius, the world’s mainstream hybrid vehicle in 1997. The Prius combined a gasoline-burning engine with an electric motor and small battery. This allowed drivers to dramatically increase their fuel economy compared to traditional internal combustion engine-powered cars.
The new technology proved to be a sales sensation: Toyota has offered hybrid versions of much of the rest of its lineup. The automaker has sold a total of 20 million hybrid cars, trucks, and SUVs around the world, and 5.4 million in the U.S. alone.
But in the meantime, other automakers, spurred by ever stricter government regulation and the success of newcomers like Tesla, began investing in fully electric vehicles.
For a long time, Toyota’s leaders argued there are fundamental engineering challenges to battery-powered electric vehicles — they take a long time to charge, require heavy and expensive batteries and have still limited range.
Those criticisms are less valid now given recent improvements in battery technology, auto industry analysts say. More important, companies have found a strong business case for EVs. Tesla is now the leading luxury brand in the United States.

Toyota’s new $35 billion investment, announced in December 2021, includes a plan to introduce 30 electric models by 2030. That is just under a quarter of the more than 130 models it currently makes.
At the same time however, Toyota said it would invest an equal amount in hybrids and hydrogen fuel cell vehicles.
Gartner, an industry research firm, expects gasoline-burning engines will still make up about 50 percent of sales in the early 2030s.
“We still think that in 10 years, 50% of new vehicle sales will be gasoline,” said Mike Ramsey, a vice president in Gartner’s CIO Research Group. “And if you look at the global footprint, that is almost certainly going to be true, because you’re not going to see in Nigeria, in Iran, in Indonesia, a 50% market share for electric vehicles, period.”
Watch the video to learn more about Toyota’s singular approach to electric vehicle manufacturing.

WATCH LIVEWATCH IN THE APP More

“I’m convinced we will get to a low-carbon, no-carbon economy — we’re going to get there because we have to,” John Kerry tells an audience at the World Economic Forum in Davos.
“I am not convinced we’re going to get there in time to do what the scientists said, which is avoid the worst consequences of the crisis,” Kerry says.
During his speech, Kerry also addressed the net-zero pledges made by companies around the world.

John Kerry photographed at the World Economic Forum in Davos, Switzerland, on January 17, 2023.
Fabrice Coffrini | AFP | Getty Images

The world will eventually move to a low-carbon economy, but it may be too late to avoid the worst effects of climate change, according to John Kerry.
Speaking at the World Economic Forum in Davos, Switzerland, on Tuesday morning, the U.S. special presidential envoy for climate issued a stark warning about the years ahead.

“I’m convinced we will get to a low-carbon, no-carbon economy — we’re going to get there because we have to,” he said.
“I am not convinced we’re going to get there in time to do what the scientists said, which is avoid the worst consequences of the crisis,” he added.
“And those worst consequences are going to affect millions of people all around the world, [in] Africa and other places. Of the 20 most affected countries in the world from [the] climate crisis, 17 are in Africa.”

Read more about energy from CNBC Pro

In his remarks, Kerry also spoke about the task of keeping the goal of limiting global warming to 1.5 degrees Celsius alive.
“So, how do we get there? Well, the lesson I’ve learned in the last years and I learned it as secretary [of State] and I’ve learned it since, reinforced in spades, is: money, money, money, money, money, money, money. And I’m sorry to say that.”

The 1.5 degrees goal is contained within 2015′s Paris Agreement, an accord that aims to “limit global warming to well below 2, preferably to 1.5 degrees Celsius, compared to pre-industrial levels.”
Cutting human-made carbon dioxide emissions to net-zero by 2050 is seen as crucial when it comes to meeting the 1.5 degrees Celsius target.
Over the past few years, many multinational corporations have announced net-zero pledges.
While such commitments draw attention, actually achieving them is a huge task with significant financial and logistical hurdles. The devil is in the detail and goals can often be light on the latter.
Kerry addressed the topic in his speech. “Let’s face it, [a] whole bunch of companies in the world have chosen to say, ‘I’m going to be net zero by 2050’,” he said.
“And you and I, we know they don’t have a clue how they’re going to get there. And most of them are not on track to get there.” More

Singapore is welcoming them back, but a full return of Chinese tourists isn’t likely in 2023, Singapore Tourism Board executives said at a press conference Tuesday.
Singapore Tourism Board’s CEO Keith Tan cited limited flight capacity and the speed of China’s border reopening as some of the reasons a full recovery from Chinese tourists isn’t expected this year.

Tan told CNBC that travel recovery from China is unlikely to exceed 60% of pre-Covid levels by year-end.
“We are hoping to get, for the whole year 2023, between 30% to 60% of where we were compared to the whole year 2019,” he said. “In our most ambitious and aggressive scenarios, we hope that things will be almost back to normal by the end of 2023.”
Currently, the number of flights from Singapore to China is only 10% of what it was pre-Covid. Unlike other countries in Asia, Singapore has not imposed new Covid-related restrictions on travelers from China.
Singapore’s tourism industry is expected to recover to pre-pandemic levels by 2024, according to its tourism board.

Competition from Hong Kong

Tan said he welcomes competition from Hong Kong in terms of MICE — meetings, incentives, conventions and exhibitions.

Hong Kong “will throw a lot of resources to secure and anchor a whole range of events,” he said.
“I welcome that competition. I think it is good, and I’m glad that Hong Kong is back in business … but that also means that we have to work harder at securing a good set of events and investments for Singapore.”

Juliana Kua, assistant CEO of Singapore Tourism Board, added that there is “a strong pipeline of MICE events coming up to attract Chinese corporate travelers.”
Kua said that a trend observed among Chinese travelers is small group bookings with customized itineraries, rather than off-the-shelf packaged tours. The Singapore Tourism Board is targeting these travelers, she said.
Singapore’s international visitor arrivals reached 6.3 million in 2022, which is 33% of 2019 levels, according to Singapore Tourism Board’s statistics. About 1.1 million visitors came from Indonesia, the highest number of arrivals from any country.
Preliminary estimates for tourism receipts are between $13.8 billion and $14.3 billion Singapore dollars ($10.4 billion and $10.8 billion), which is around half of 2019’s tourism revenue. More

Adar Poonawalla, chief executive of the world’s largest vaccine manufacturer, said Chinese officials should “open themselves up to healthcare and vaccines from the West and set aside any political issues or things that are holding them back.”
The main Covid-19 vaccines approved for use in China are from Sinovac and Sinopharm. Some studies have found these jabs are less effective at fighting the Omicron variant than are other mRNA vaccines.
China may need to “really seriously look at [vaccine imports] now, as a booster at least, and take vaccines which have proven, real-world data and efficacy,” Poonawalla said.

China needs to move past political considerations and look at importing Covid-19 jabs to end the pandemic globally, according to the chief executive of the world’s latest vaccine manufacturer.
“They need to open themselves up to healthcare and vaccines from the West and set aside any political issues or things that are holding them back,” Adar Poonawalla, CEO of the Serum Institute of India, told CNBC’s Joumanna Bercetche at the World Economic Forum in Davos.

China has experienced a massive spike in Covid-19 cases and fatalities after abruptly ending its zero-Covid policy, which imposed strict lockdowns, mass testing and quarantine on arrival into the country.
China’s full Covid vaccination rate is nearly 87%, according to World Health Organization figures, which show 54% of the population has also been inoculated with a booster jab.
The main Covid vaccines approved for use in China are from Sinovac and Sinopharm. These jabs are less effective against the Omicron variant than are other mRNA vaccines, such as Pfizer and BioNTech’s, several studies have found.
Poonawalla said China’s pandemic reaction of 2020 — which included building hospitals and infrastructure and taking precautions — showed that Beijing could respond rapidly.
He stressed China’s decision not to import vaccines from the U.S., India and elsewhere, which have been “very effective.”

“I think they may have to really seriously look at doing that now, as a booster at least, and take vaccines which have proven, real-world data and efficacy,” he told CNBC. “Otherwise the alternative is that a lot of people in China are going to continue to get infected and we just hope — we wish them the best of luck in trying to manage that crisis and come out of it as soon as possible.”

He added that this also represents a global issue, given the number of people who want to travel to China for business or leisure, as well as the number of Chinese nationals who would be travelling overseas.
“We really need to end the pandemic and infection in every country, because we all need to be safe,” Poonawalla said.
“They’re [China] still making up their minds on which way they want to go and I hope it all ends quickly.”
The Pune-based Serum Institute of India produces more than 1.5 billion vaccine doses annually for various diseases. Poonawalla said that the company would be interested to provide vaccines to China, but that discussions with Beijing officials had been unsuccessful so far.
CNBC has contacted a Chinese government representative for comment. More