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tv   Fast Money  CNBC  October 8, 2015 5:00pm-6:01pm EDT

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laggards that are going to continue to lead? >> don't forget about the tomatoes. >> it's a long story. >> appreciate it, stephanie. >> "fast money" with alcoa's conference call is next. >> live from the nasdaq market site overlooking times square, i'm melissa lee. netflix's biggest bull got more bullish on the name. it's not just today's price hike. he'll be here to explain. ibm popping on fresh rumors with activists' involvement. who could it be and what could it mean for the stock? later, don't look now but one maligned fast food stock made a 52-week high.
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it could be your best trade. the story of the night, alcoa falling more than 4% on an after ou hours earnings miss. >> so this one is a miss for alcoa on top and bottom line. reporting adjusted earnings of 7 cents per share versus 13 cents the street had been looking for. revenues of $5.57 billion falling short. drag primary metals or smelting and refining business as aluminum prices decline 27% this year according to alcoa. given the recent weakness in china and the effect on aluminum, the ceo and chairman telling cnbc comments about that country. >> pretty much on all segments lowered the numbers on china. you have to put it in perspective. it's not like falling off a cliff. for alcoa, what is important is
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in the value add business, the markets that are important us to or the developed markets. we feel like a breath of optimism. >> alcoa lowered its estimate for lower production in china to up 1% to 2%. also reduced its heavy duty truck production outlook and reduced its commercial building and construction sales outlook for china. kleinfeld expects global demand to increase this year and expects a global aluminum deficit in 2016. the conference call is getting under way right now. one big focus will be more details about the plan to split into two next year. we'll bring you headlines later in the show. >> thank you very much for that.
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alcoa in the after-hours session. we have seen a steep run-up. in materials in general over the past month, what does that do to that rally we have seen? >> i don't know if alcoa is going to do anything to fcx or any other names. it's a declining business like freeport-mcmoran. i get that fcx rallied and alcoa rallied into this. at $10.50, i think it's a no touch. revenues decline 10% year over year. it's not a good quarter. if china might not be falling off a cliff, but ratcheting down the numbers to the extent they did, that's bad. you can say alcoa is no longer a bellwether stock. the businesses seem to be in decline. >> i do think this is a microcosm of the bigger picture of the economy and market here. typically i ignore alcoa earnings. you had lowered expectations in this. nobody thought they were going to do very well. they missed those.
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not only that, it ran up into it. let's look at what the market's been doing. you have this possibly fed backing off their rate hike pledge. reflation trade. people covering their shorts and material. going into the end of the month where the fed is supposed to make another decision. if you look at alcoa, it's mirroring what the market will do. what concerns me, we get to the end of the month, get into this earnings season and disappoint on lowered expectations. then you have that moment where things fall off underneath you. >> wily coyote. all these metaphors here. i find it curious he mentioned china was not falling off a cliff. i don't know what he considers a cliff. going from 1% to 2% to 5% to 8% is a sleep decline. >> klaas is a glass half full
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guy always. when things go from terrible to bad, that is what's happening. bhp, the best of them all is up almost 25% in the last six sessions. i think the cycle in china is bottoming. i've been saying that three to six months. there is no question to me that the negative sentiment on china is something you should be buying at this point. it's not getting worse. i think if anything, monetary policy is starting to adjust in a way that's going to help. lme prices are below the industry incentive to produce more. >> i want to broaden it out. we had just a few data points in the q-3 earnings season. we have this, yum, domino's pizza this morning, adobe. they are disastrous reports when it comes to the stocks reaction. >> i say there's some set-ups here that are interesting. people have very low expectations for this quarter. no question about it. i think the set-up within different sectors and treated sector by sector could be
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interesting. biotechnology. biogen is one of the first companies to report. expectations for biogen are extremely low. this could be a scenario if they come out and numbers are strong or they're good, at least good, you could see a massive rally in that space. earnings will be a catalyst to get people to flow money back into biotechnology. at some point in time, you are going to have valuations. they are going to matter again. it's a rotation out. my point is, i take a look at that in certain sectors. >> what would you be more cautious or bullish about given the earnings data points? >> i think they are telling you a couple of things. dollar strength and it's not just the dollar against the yen. it's about the currency everywhere else in the world. this is a time for caution after the type of move we've seen in the markets. the reason is we got a terrible payroll number which took the fed out of the picture.
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everything the fed said is transitory is going up right now. they can make this switch quickly. if the fed is back in play, this market is unnerved. >> more on alcoa as we have it again. we are seeing xwgap falling har. >> gap reported its september same-store sales after the close down 1% which actually was in line with analyst expectations. banana republic and the same sake chain continue to be the biggest weights on this cap's potential to go forward. gap saying that the gross margin rate for the third quarter will be similar to what we saw in the second quarter. what wasn't a part of this release but i spoke with gap about earlier today is that marissa webb, the creative director for banana republic will be leaving that post after just about 18 months. gap has a minority investment in her personal collection as a designer. that remains and she says on as
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creative advisor. she will no longer be the creative director. we saw a similar move some time ago with gap's rebecca bay. she moved on. perhaps there is uneasiness with the different changes in the leadership because we know stefan larsson is leaving to go to ralph lauren. it's just another position in the gap hierarchy that is moving around again. >> thanks for that. the stock is down about 6% right now. if it opened here, this would be a new 52-week low in the stock. >> this is the low we made september 30th. that announcement, stefan larsson leaving to go to ralph lauren.
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the stock traded lower. tomorrow if the stock comes in 27.50 bounces to 28, maybe have a tradeable bottom. especially after the bottom we saw on the 30th. gap is not expensive 8 1/2, 9 times forward earnings, but there are a lot of question marks. i've got to pick your levels. the level is 27.50. >> the anchor has been the full price portion of their business. you have the old navy which is discounted. that makes me look at tjx. tjx held up fairly well throughout this whole market turmoil. it is trading at 19 times forward earnings. not the cheapest thing out there. if you get weakness in tjx, that might be something you want to buy. >> netflix is doing something the bears said it would not do. it could make the stock a screaming buy. supersized gains, while yum! brands is taking other fast food giants are heating up. tasty returns to your portfolio.
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>> several of the most high profile names going public trading below their ipo prices. any value in the wreckage? could this signal a more troubling sign for the market? good. very good. you see something moving off the shelves and your first thought is to investigate the company. you are type e*. yes, investment opportunities can be anywhere... or not. but you know the difference. e*trade's bar code scanner. shorten the distance between intuition and action. e*trade opportunity is everywhere.
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ibm has a new activist investor taken a stake in the name. we did reach out to ibm. they officially said no comment. >> i think we've done a decent job on this stock. we said given the fact they are declining business for the last couple of years, the right multiple is somewhere between 8 and 9. you do that math, 139, the stock bottomed out at $140. it had a nice bounce since. they will report earnings in a week. they are not going to be good, in my opinion. people pouring in, including warren buffett. it's a mistake. i get the fact the stock can continue to rally. you have to admit this has been a declining business the last couple of years. that continues. >> any buyers of ibm on this desk? >> no.
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i'm not a seller. if you think about what's going on here, whether it's activism or a transition well priced into this stock or not a material valuation, we act like this company doesn't contain some of the smarter people in the business in terms of programming. ibm is still ibm, to say they are not in a position to reinvent themselves is a matter of time. >> i look at ibm and say hands off from the standpoint of the stock moving higher. >> it's such a broken story. they don't need to do too much to change things. you get an activist in here. >> what can they do? >> say they get a new ceo. watson is what the future of this company is. if they can get that going, it will be a growth story. >> sounds like you would be more inclined to buy it. >> i would be much more inclined to buy it. >> they let people go, figured out how to fix themselves financially. they've done everything to put
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it in the right shade. they've got no growth. stay away. netflix stop popping after announcing it is hiking the price of its most popular standard streaming plan to $9.99 from $8.99 a month. rich greenfield has a buy rating on the stock. he joins us on the fast line. always great to speak with you. >> thanks for having me. >> talk about dollar impact. what does this do given how many subs they are projecting by the end of the quarter or year, take your pick. >> the actual price increase is phased in. for all subscribers that had netflix over the last 18 months, they are not going to bear this price increase for a year. me, i signed up before may of 2014 and that's a significant part of their base of subscribers. those subscribers don't feel the
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increase until the end of their locked in holiday from the price increase which is may of 2016. this is a graduated impact. i think the real bullishness here, it feels like they are about to report earnings in a few day, wednesday of next week. it's hard to imagine them coming out with news that you are going to be raising pricing on all new subscribers if you really having trouble adding new subscribers. while it's always hard to get a read on what's actually happening at netflix, it does seem -- it's hard to imagine you are missing plan, and if you want to be a new subscriber, it's going to cost you more. that doesn't sound like a logical connection. >> you think the 6% move in the stock in today's session is predicated on the notion that because -- >> tea leaves. >> right. you're assuming they've got good
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news or raising price, hiking the price on new subscribers, therefore their sub numbers will be great? >> there is a little bit of that built into it. anybody worried into the quarter feels better based on this news. the real reason why, what is not expecting them to raise price on a subscriber like myself. what was going to happen in may of 2016 my price was going to go from $7.99 to $8.99. it's now going from $7.99 to $9.99. if you've been on the old price 18 months, you're probably a consistent subscriber. you probably don't churn. i think netflix having the confidence to raise price buying 25% to go from that $7.99 to $9.99 shows you that they believe they added enough content and have enough stickiness that price is no
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longer a major inhibitor. when you look at hbo at $15, hulu ads, this is a sign of confidence they believe their product is so valuable and loved by consumers that it has pricing power. that is why i think the stock did what it did. >> rich, we'll leave it there. thank you for your time. >> thank you for having me. >> what do they do with the money? >> rich is one of the best analysts on the street. you have to defer to his judgment. though i am not sure this means they are going to come out with good earnings. the other side of that coin is you have to raise prices because we have to raise revenue because our subscribers aren't going up the way we thought. i don't know if i would trade it based on that analysis. not only that, when you're going into earnings and the stock is up 6%, that scares me. >> or their content costs are rising quickly. >> they have roughly 45%
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penetration in the u.s. already. this is a confidence issue. 100% of confidence issue in their content. the fact they are boosting prices and $2 fee will be implemented based on past increases and new increases very soon for subscribers. it's a massive confidence issue. they've got big penetration in the u.s. that is not where their growth market is. >> let's talk about international. they launched in japan recently. they are about to launch in a lot of asia, singapore, taiwan. japan is number six. it's growing slowly internationally. strong adoption means you're able to raise prices. that's the inference people are making. it comes down to this. earnings are going to be fine. can they grow fast enough to justify this multiple? i don't think they can. i think the stock is capped at $125. a function of the market, growth versus value, if these guys aren't showing the kind of
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growth, they'll sell off. >> i thought this may be a distraction ahead of bad earnings. >> depends on what you don't miss for the stock. i think it's a good story. their international growth has been fantastic. it's not about earnings. last quarter stock was up 11%. you might see a repeat this quarter. >> gopro pulling another 5% today. after a more than 55% decline in 2015, is it safe to say the worst may be over? top analyst with a surprising take. leave the gun. >> that's because the godfather of biotech, the chairman of biogen is here. he says investors are missing something big about biotech. >> dog food? >> that describes shake shack and yum shares today. other stocks are looking tasty.
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we'll tell you which ones when "fast money" returns. 40% of the streetlights in detroit, at one point, did not work. you had some blocks and you had major thoroughfares and corridors that were just totally pitch black. those things had to change. we wanted to restore our lighting system in the city. you can have the greatest dreams in the world, but unless you can finance those dreams, it doesn't happen. at the time that the bankruptcy filing was done, the public lighting authority had a hard time of finding a bank.
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citi did not run away from the table like some other bankers did. citi had the strength to help us go to the credit markets and raise the money. it's a brighter day in detroit. people can see better when they're out doing their tasks, young people are moving back in town, the kids are feeling safer while they walk to school. and folks are making investments and the community is moving forward. 40% of the lights were out, but they're not out for long.they're coming back.
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ruby tuesday lower after hours on earnings. >> that's right. the restaurant operator's first quarter revenues were in line
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but earnings came in well below estimates. this despite rebranding efforts and store closures made over the past year or so. first quarter same restaurant sales are up about a percent but are lower when you look at year over year numbers highlighting the competition ruby tuesday is facing in the fast casual dining space. stock down 5.5% in after hours trading. >> still not a cheap stock. still trades north 30 times forward earnings. short interest is growing. no. i'm not at these levels. >> this news part of the big news today out of the fast casual space. let's go through some of the names in the news. we'll have the traders rate stocks in the space making stocks using the upscale michelin star rating system which uses a scale of three stars and is the reason we are playing fancy piano music. let's start off -- >> very relaxing.
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>> guy, you're looking at mcdonald's. how many stars? >> i'm giving tim seymour three stars. the stock gets 2.5. >> 52 week high after the yum disaster. i thought they would take mcdonald's out to the wood shed. once again mcdonald's traded up to $102. seemingly failed. here we are right back there. i would give it three if it was north of $105, but 2.5. >> don't we all get three stars at people? >> no. definitely not. >> so obnoxious. how many stars does domino's pizza get?
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>> i gave them 3 stars. >> they dropped a donut. >> domino's has been the leader in using technology to bring in customers. that's reflected in the u.s. same store sales. they did have a hiccup here. i would not bet at all against patrick doyle. like starbucks, he's the howard schultz of piazza. don't bet against this guy. domino's pizza $100 seems to be a very good support area. i would use that to buy. >> three stars. >> coffee-flavored pizza. >> shake shack taking a hit as shale holders filed to sell more than 26 million shares in a secondary offering registered at 2.50% discount. the burger chain will not receive proceeds from the offering. how many stars? >> i give it zero. >> zero stars. >> we've been all over this story and this stock. you're watching private equity tap you on the shoulder and say the stock should be sold with
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the announcement today. when we initiated it, we put $542 target on it. this is a story that basically is the growth is outside of new york city and they are using every comp they can inside new york city and cherry-picking comps around the periphery to make numbers look strong. growth of 450 stores is not the 36 stores they currently have. it's not the 11 in new york. it is middle america. i promise you. this valuation of this stock right here is way, way overdone. >> zero michelin stars. does that equal a short? >> yeah. i think the stock is a short. >> good luck getting a reservation there. >> last but not least, yum getting love from credit suisse which upgraded it to neutral from underperform. stock failing to rally. how many stars? >> again, we are voting based upon what we think of this as an investment, not the quality of earnings or the food. i wasn't going to go there. at $67.40, it's trading 16 times
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2016 which is cheap. clearly the china business now has much less transparency and visibility than we've seen in a long time. even through some of the worst of it. three stars is where we go. cheap and hasn't traded here in two years very important level $65. you trade that as your low. >> interesting. 2.5, zero stars, 3 stars, how many stars do we get? >> collectively? >> i've got my three pack. >> bears are swinging against gopro which is hovering against its ipo price. could we be in store for a holiday headache? about retirement. you a 401(k) is the most sound way to go. let's talk asset allocation. sure. you seem knowledgeable, professional. would you trust me as your financial advisor? i would. i would indeed. well, let's be clear here. i'm actually a dj. [ dance music plays ] [laughs] no way! i have no financial experience at all.
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welcome back to "fast money." stocks accelerating into the close today. crossing 17,000 the first time since august 20th. both indices at their highest levels since before the flash crash. energy materials were the best performing sectors. here is what's coming up in the second half of "fast money." gopro hitting another all-time low. shares fell 6%. is the growth story over? a top analyst weighs in. shares of one of the largest
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biotech sectors biogen down 30% in the past three months. the chairman of that company with us for a special sox therapy. the once-hot market for ipo's. we take a look at notable names. >> lackluster performance in some of the notable ipos pushing some to think whether it will impact future listings. let 's start with alibaba. strong debut but trading down 31% from its first day. this year cloud storage firm box went public, a solid listing. shares are down 14% from its initial public offering. etsy is also one to note trading down 16% from its debut in april. we are keeping a close eye on gopro after morgan stanley put out that negative note yesterday cutting its price target by 44%. citing weak demand for most recent innovations.
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gopro shares are coming close to falling below its initial public offering price of $24 a share. keep an eye on that stock. >> thanks for that. let's hit alibaba first. jack ma had that shareholders' letter out which seemed a little desperate. >> i think there's a lot of communication issues with this company. expectations were too high coming in. comes back to valuation. this thing trades around 24 times 2016 which is a number where it's based on second quarter gmv which was weak. you got through the golden week where sales were very good in china, not so great in hong kong. the worst of the news is priced into this. it's all about the discount rate. what discount do you think you should have for lack of transparency in china? >> look at the stock and i say if ad spending slows down in china, which it is most likely going to do, baba would slow
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down from ad spending. >> why would it slow down? >> budgets get cut from an ad perspective, it is a beneficiary of a market -- >> i think the internet space is on the verge. >> i get that. china specifically. i'm an advocate for the internet names. china specifically, could you see some weakness there if they get cut slightly, baba will get affected by it. >> in terms of the broader market, it's not just these ipos that have been public, but the ones that recently have gone public, opening below or pulled. >> right. it's not a great market for this. we talked about it last night. potentially, this is the first signs of cracks in the venture capital model. we talk about unicorns and bubble in silicon valley. if you don't have an exit strategy, if you can't do that ipo, you are going to be less willing to put money in on the start-up. that's probably the big e picture here. the one that concerns me is etsy. amazon came out with their
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homemade or something like that. i don't want to compete against a company that is not afraid to lose money on a product. etsy, i would be concerned about. >> we had that other site. weebly. >> they were selling potatoes. that was neat. >> here is a stock that's gotten obliterated. you had your analyst date at the beginning of the month. ceo bought shares which is a good thing. best thing about the stock, in my opinion, is the fact it has a short interest approaching 50%. we've seen what happens to stocks like this in this environment. you get massive short covering rallies, which we might be on the verge of. >> gopro is a few points away from its ipo price. the stock lost half its value this year. analyst brad ericsson has a hold rating. always great to speak with you. they don't have a killer product for the holiday season.
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according to the company itself and its new york investor meeting, they are having difficulty when it comes to relationship how it's priced to the other products. why is it even a hold at this point? what do you see here with gopro? >> i think there is obviously a lot of value here. the brand shouldn't be underappreciated. one thing that is interesting about action cameras, you are not seeing new entrants. gopro continues to dominate this market. with that said as you pointed out, we talked about demand for session being luke warm back as far as july. i think the fact that the company's prioritized it so much this year is proving to be this disappointment here for investors that we are seeing. >> what does it need to do at this point, in your view? they did cut the session afterwards by $100. has that helped at all? what are the next steps here? do we have to wait as investors? does one just have to wait until they come out with another
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product like the drone they've been talking about and some other things? >> things like the drone will help support growth next year. we are still modeling unit growth next year. much slower than 2015. we need to get through the holidays is the bottom line. not having a new product was a disappointment and we are in a period right now where you've got a seasonal pause in demand as the holiday gets going. that makes it difficult. and could be more tough sledding ahead near term for grow pro. >> brad, for a company that's supposed to make a lot of its money in the holiday period to hit an all-time low doesn't seem like a good, not a vote of confidence in the stock and how it's going to perform into the holidays. if it can't perform now, people don't want to buy it now, then when? >> i think as we look out to next year, clearly we expect a
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high end refresh in the first half of the year. they really haven't had a high end refresh now in 12 months. as we look out, that will certainly help support growth. you've got drones in there. they are still looking to ramp out incremental distribution, primarily into china where being a cameras as a whole are relatively nascent still. there are other markets. certainly this does present this situation of slowing growth. that's why we have not been positive on the shares, frankly. >> brad, we'll leave it there. th thanks for having me. >> that's dismal. >> i look at it this is a hardware company, one product. apple is the largest hardware company trading 11.5 times. is gopro overvalued here? >> even at an all-time low. >> you have a trade here. they just reaffirmed earnings
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tonight. one of our traders on the desk pointed this out. probably takes the preannouncement element out of the equation. there is a massive short interest here. you probably get trade near term. i wouldn't be long term. i think it's a one product story. >> i'm not going to repeat what david said, but two things about this stock, virtual reality is something they are getting together with facebook, the oculus acquisition is a big deal for facebook. see if they get the 360 degree video content. that's where they want to be. the media story is ridiculous. we'll figure that out. although that squirrel or chipmunk? >> i think that rodent. >> squirrel. >> has seen more air time. >> it's a groundhog. >> than i have on cnbc. that video is on all the time. >> it's great stuff. i could watch that all night. >> as we are. >> that's not reason enough to buy gopro. i would not step on the short.
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>> i would go with the life jacket company. see the cute life jacket? >> do you still wear a life jacket guy? >> as often as i possibly can. >> flutie wings. >> the trade on gopro. >> keep listening to poison. >> i do agree with what dan and timmy said. maybe by some miracle somebody comes out and gobbles these guys up. it's been tough. >> is this one of your examples of a stock that's come down so much it needs to do a little bit of something right? >> yes. exactly. there is a point here. this has been cut in half since august. >> a point now? >> yes. within a couple of points of here, maybe it's right now. the sentiment is awful. the story is clearly broken. that's in the stock. you have a stock cut in half in less than two months. that sentiment is so negative and it only takes one little thing to get a nice rally. i'm more with dave. you could get a tradeable rally.
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i would not be long it long term in this market environment. >> coming up, don't let the rally fool you. now could be the perfect time to buy protection for your portfolio. >> you see him getting ready to go now. the godfather of biotech known as the chairman of biogen is here in the building with all the answers to your burning questions on what is behind the volatile moves in the biotech space. he joins us after this break. stay tuned. (vo) what does the world run on? it runs on optimism. it's what sparks ideas. moves the world forward. invest with those who see the world as unstoppable. who have the curiosity to look beyond the expected and the conviction to be in it for the long term. oppenheimerfunds believes that's the right way to invest... this big, bold, beautiful world.
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one sector sat out the rally and that would be biotech taking a massive beating the last few months. one name hit the hardest is biogen. down 30% the past three months. time for a special edition of stock therapy. meg tirrell is joined by the chairman of biojeb and man known as the godfather of biotech. >> thank you so much for joining us. >> my pleasure. >> let's talk about where we are in biotech. it's been a tough month. what would you tell folks nervous about investing in this space right now? >> first i would acknowledge their nervousness. it's been a challenging couple
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of months. we've had the near china collapse which we sat around trying to handicap what the fed was going to do and the marketing effect. if you were to look at a chart of the last three months of the nbi against the market indices, you will see that they all began from mid july on ward to trickle down. however, starting september 21, the biotech index took a vertical dive. i think even though i'm not a big fan of confusion association with causation, i think it's probably accurate to say this was due to the discussions of drug pricing, the points made by bernie sanders and hillary and valent to speak about drug prices as high as they are, and this debate is at this point the
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central theme that's challenging the sanity of biotech investors. >> do you think this volatility will continue as drug prices continue to be in the spotlight? >> i would say where we are today is not as bad as people think. the last time i was on the show which was about six months ago, we looked at the last group of companies that have gone public 2010 and 2014. we made a number of observations. one of the observations i made was there were several that were quite expensive. there were 17 of them with a market cap above $1 billion. i argued that it would have been difficult to find ways by which they could return to investors. that number is smaller now. at the time there were maybe 38% trading below the ipo price. now 46% trading below the ipo
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price. dramatically different. the big nine, you compare them to now, they are off about 2% if you take biogen out. biogen, as melissa pointed out, has been down 34% since that time. the markets spoke, simple as that. the fact is back in april we are asking the question, is this bubble about to burst? now with prices about the same we are saying are we purgatory? there is something ironic about this. that's point number one. point number two specifically to the question you brought up, i think to the extent the confusion and the concerns are driven by the drug pricing debate, i think that's likely to go away in the next several weeks. politicians cannot sustain attention to particular point
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forever. there is no doubt the drug prices are an important subject matter. we need to thing a lot about. before we have quick solutions how are we going to find innovation? >> i wanted to follow up on the notion about the biotech bust at this point. if drug pricing concerns fade away the next several weeks, what is the catalyst to get investors off the sidelines and get investors to be less nervous about the market? is it going to be a renewal in the ipo pipeline for biotech? is it going to be renewed m&a activity? what is going to get people to say maybe we aren't that bad here. >> as always, my view on this matter is that it's never something highly visible and highly specific, but rather a series of subtle sequential events. even in this difficult environment, we had several ipos priced in the last few days.
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most have been priced under duress with final prices below the filing range. most have done poorly the after market. one of them has done quite well. it's been up 50% in the week since pricing. so it's not as if we are in a complete disarray. i think probably what will be is the debate on drug pricing will slowly subside. in a timid fashion more ipos will get done and people will come back to biotech so long as there isn't an appealing of alternative investment opportunity for them to consider. in my mind that will drive people away from biotech, someplace elsewhere returns on a risk adjusted basis will be more attractive. >> we are out of time. we have more questions and will have to continue next time. thank you. >> thank you. >> thank you so much. the chairman of biogen. >> gilead on the 27th, amgen on
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the 28th, celgene early november. amgen 13, celgene 19 times. all very cheap, great pipelines, all tremendous margins. i think they are going to get rewarded each one when they report. >> still ahead, a top company in the mobile space taking on apple over its iphones. the ceo of ericsson after the break. should you be playing defense if the markets move higher? at ally bank no branches equals great rates. it's a fact. kind of like mute buttons equal danger. ...that sound good? not being on this phone call sounds good. it's not muted. was that you jason? it was geoffrey! it was jason. it could've been brenda.
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welcome back to "fast." code conference is wrapping up in half moon bay, california. julia boorstin is there live. >> one of the companies generating buzz is ericsson. it's embroiled in a number of lawsuits with apple. i moments ago spoke with ericsson's ceo and he made a point of saying it was apple who sued them first. >> in our industry, we share patents. everyone can use our patents and we have cross licensees. we had that with apple and ended
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up not having one. then we are now in litigation. we always want to sort of settle outside of court. we'll try to do that. right now, we are running several litigations with apple. >> ericsson aspires to be the dominant provider for 5g, what he calls the industrial internet. company stock has been struggling as he works to transition from devices to selling services. ericsson is working with different industries including with some right here in wine country in california. announcing today they are teaming up with intel to put mobile sensors around vineyards to generate more wines around their grapes. this is serious stuff. >> apparently. thank you and enjoy. julia boorstin from california. they are in the same position kind of as blackberry in terms of moving the software company. >> right. exactly. it's a transition. you have to believe in the
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transition. it hasn't worked out so well for blackberry. if i want to play the internet, i would rather go with a cisco. >> switching gears. vix fell to its lowest level since august 20th. it makes buying portfolio protection cheaper. mike is here to show us how to do it. >> that's right. that's your opportunity. buy insurance when you can, not when you have to. obviously, we've seen that the market rallied a decent bit at the same time. if you have a portfolio stock, what you can do is simply look at something like the spy etf and buy an at the money put. i was looking at the $200 put. i was looking at it earlier today and selling the 184 to lower the cost and offset the decay. you're spending about 2% of the current value of the s.p.y. to do that. each spread represents about $20,000 worth of s&p 500. >> thanks for that, mike.
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check "options action" tomorrow. >> is there a special guest possibly this week? >> g swizzle will be on. >> coming up next, traders tell what you they are watching tomorrow. i'm here at the td ameritrade trader offices. ahh... steve, other than making me move stuff, what are you working on? let me show you. okay. our thinkorswim trading platform aggregates all the options data you need in one place that lets you visualize that information for any options series. okay, cool. hang on a second. you can even see the anticipated range of a stock expecting earnings. impressive... what's up, tim? for all the confidence you need. td ameritrade. you got this.
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time for the final trade. tim. >> this has been as much risk and oversold wynn and other casinos are placed to fade profits. fade it and buy lower. >> gopro. not for the long term. for the short term for a trade. i think the stock is a buy here. they confirmed the report date. takes the risk of preannouncement off the table. i think you'll see covering in the name tomorrow. >> twitter. i think you buy that on dips because moments is a game changer for them. >> tim enjoys shopping there, but nothing good at the gap. however, if it holds at the low
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of $27.50, you get long cheap deals. >> it's no chess game. >> thanks for watching. see you tomorrow. my mission is simple -- to make you money. i'm here to level the playing field for all investors. there's always a bull market somewhere and i promise to help you find it. "mad money" starts now. hey, i'm cramer. welcome to "mad money." welcome to cramerica. other people want to make friends. i'm just trying to make you some money. my job isn't just to entertain but to coach and teach you. call me at 1-800-743-cnbc. or tweet me @jimcramer. you mean to tell me after all that chatter about the need to raise rates


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