tv Fast Money CNBC September 19, 2016 5:00pm-6:01pm EDT
kidding. >> he's my boss. i'm very limited in what i could say. >> who was making the point about amazon being a part of everything this day, "the washington post," they are in the cloud -- >> nobody could talk about them. >> we are all conflicted. >> but thank you for joining us. katherine ram pell and michael santoli, that does it for "closing bell." "fast money" begins right now. >> "fast money" starts right now. overlooking new york city times square, i'm melissa lee. we have tim, david, brian and dan nathan. tonight on fast, trouble on the homefront. despite the strong housing numbers there is a major flaw in the home building stocks and we'll see what that is. and there are only 50 days to go until one of these two candidates is elected to become our next president so why is the market so calm in the face of the historic election. we have a special report. and later shares of sarepta almost doubling in value. the ceo will be here to explain.
and the only thing matters to your money and market this is week and that is two meetings. bank of japan and the fed on deck this week. the question is simple. is this the week central banks ruin the rally and what changes should you make to your portfolio in advance. >> the probability is very high that you do. and you have two different things. the transmission is the u.s. dollar. so you have the bank of japan coming out tomorrow night, early wednesday morning. let's -- they are going to do one of two things. they are either going for a massive stimulus program and the dollar is going to rip, or they are not. and if they don't do something, then you have a lot of problems all over the place because they need something. they've got nothing. they've got a huge problem over there. >> i think the bank of japan is important. and i would argue they are more important than the fed because i don't think the fed will do anything. but how are they going to suddenly either go on a spending spree or a nothing spree. and if anything, to me, the risk
is the package is not as much as people expect and then you see the yen rally and the dollar goes down. if anything the dollar is going down this week. >> and as a dysfunction of -- >> and the bank of japan doesn't do anything. could you lose confidence in the yen and that could reverse. >> do you have confidence in the yen now. >> no, it is shocking to me any way. >> that is the problem. i think b.o.j. is realizing the efficacy is not working and they have other options and it is not buying long into the curve and the u.s. curve will go back up and it will push the yen higher and dollar lower. >> and i do agree with tim. >> don't think it will necessarily have -- there is not a massive impact in my opinion in the dollar except for the down side if anything. but i look at it and say this -- >> i buy. >> if i'm a person trading the market, what do i look at and do in the face of this. i'm not buying a lot today. i'm not just jumping in ahead of this move but i'll have my list of stocks that i like to buy and i want to bottom fish on if this
market does dislocate, which may happen. i think the expectations are for no move. >> such as -- >> i think you look at the financials. >> the financials -- >> i'm not bottom fishing, necessarily. look to where there is dislocation. you could see a selloff in the financials based on fact we've seen expectation trade ahead of this. there is still the slight chance they move on it. the financials are something to keep an eye on. pick the names that you like that are good names and have solid and stable earnings and look at the biotech names and any pullback there i would consider buying them. >> so for me, look at 12:00. on wapner today we had dick fisher on and he is not expecting a raise any time soon. obviously in december we're probably going to get that. but the fact is so many people are positioning for this hawkish stance in december i think you'll see rates hold pat here. you could see the dollar -- we could go back and forth on the dollar, the dixie is stuck here
at 95 -- >> but these are -- >> but these are the events that you are waiting for. >> but i'm saying i think that sets up for a situation where if equities were surprised by increasingly hawkish statement tomorrow by -- or excuse me on wednesday by the fed, then you have a situation where all of a sudden you probably do see a selloff in stocks. but i don't think it is that dramatic. we know what the levels are that everyone is looking at and it is probably not too much further than 2100 in the near term. >> how about dur you are long financials, correct? >> i am. >> what happens to your financials trade? >> they do well if it is hawkish. you might get a sell, but it is hawkish. the better trade going into this is i would be long dollar. the odds of the dollar going lower are slim. >> isn't the fed hawkish negative for credit which you have been hung up on. i don't get how you could have it both ways. >> the dollar is hawkish for -- >> everyone was so concerned and
credit was exploding. >> the financials trade is a short-term trade. it will take a while. oil is back up. so that takes a little bit of the credit problems out there. ultimately the financials will have problems. you look at european, they have problems. and the financials, u.s. trade right now long is a short-term type of thing that i expect in the next month or so, i will likely take profits on. >> what is interesting, you both like financials and you are basically on the opposite ends of the spectrum when it comes to views on how the central banks will impact trading this week. >> that is why it is a good trade. >> does that make sense? >> i agree with david in talking about bottom fishing and buying things that are cheap is what you are doing when you are bottom fishing, am i right? >> absolutely. >> so financials are cheap and they are historically cheat and the balance sheets are better and i think they are a regulatory bull's eye on their back but i think people are underestimating the ability for the guys to earn in a better environment and the long growth in the second quarter and we know that from the second quarter money banks was good.
>> what do you do ahead of the meetings. >> i don't want to talk about home builders after our main man carter worth. i think it is an interesting trade setting up there. but did you see utilities today. you had the xlu and the etf that is up 1% and i'm bullish and i think we have a fed that does nothing for the next two meeting but people think about a raise in december. but i don't think we have a scenario like at the end of the last year where fed fund futures price a fed above 1% at some point in 2017. i think that sets up decently for utilities. i know that is the point right there. >> again, you sound very sang win as opposed to -- >> you sound like no big deal. >> it is not like there is a glide path through the end of the year because the fed is going to remain on hold. >> you're going to break out and have your facebook keep going up. there is no reason -- >> i'm not -- [ overlapping speakers ] >> you ask the question. >> could you be long financials
and you asked that about a week and a half ago and the answer is yes and we just answered it on this show again. the answer is you can. one for a little bit of safety and one for a little bit of opportunity. get that opportunity. >> speaking of the fed on wednesday, we'll be joined by jeffrey gundlach. you don't want to miss that interview. one area that is sure to feel the brunt of any fed action is the home builders which rally today in home sentiment numbers but our next guest says save this rally. we turn to the chart master, so carter what do you see in the charts? >> you are having certain areas that are rate sensitive and reits and home builders. i don't like them and i'm not sure it matters what does happen tomorrow. but just to put the numbers in context, this is the performance, i have two panels here. first when the fed raises and then what wh they cut the fed funds cart rate. this is on the next day.
one week and one month. when they raise. and obviously it is down. as would be expected. and the percentage it will be down is almost 60%. by contra distinction, when it lowers, this is the performance of home builders. this is obvious stuff. but do they look good technically and they don't. let's look at a few charts. so s&p 500, your blue line, this is the etf that measures home builders and other things like home depot and lowe's and the green line and that is all publicly traded home building stocks, and there are 26 of them. and what you see here is the underperformance of the green line relative to the etf relative to the market. and that is kind of the problem. they just are not doing well. and relative performance and strength matters a lot. here it is on a three-year basis. you could see the group of 26
names plotted equal weight. it is not good. now what might be coming? this is that group on its own, the 26 stocks. i think you could draw the lines like this. we worked ourselves into a position where we will break below this well-defined line and it looks imminent. to put this in context, i want to talk about the actual numbers. there are 26 publicly traded stocks. d.r. horton is 11 billion and if you add them up that is 66 billion and all publicly traded home builders are 66 billion and the stocks compare to that. you are talking about one-third of 1%. it doesn't matter for the market. we know it a big thing for the economy and employment and home building but as it relates to the impact, it is not that big. i think home builders trade lower. >> trade lower. >> i want to talk about this. >> carter, come on over. ashley, bring on the chair. here we go.
>> you were looking at a chart. >> you were talking about the home building and you did a great job, but there is a lot of equipment guys in there. there is home depot in there and a lot of stuff in there but none of that acts particularly well. and i was looking at toll brothers today, back in late august they reported a beat and a raise and the stock rallied 9% the gday of that and it has givn all of that back and i've learned that relative importance is important and the sector is bad and if you get into the mindset where the raise is going to raise at some point in december, i think they break the levels you talk about. >> i think it is totally the opposite. look at the chart on pulte, i like that you've been trading between a predictable range and they haven't broken out but the housing data is continuing to
get better and we're at all time lows in terms of home ownership and seeing some recovery. >> that is out there. not saying that you are saying something that is obvious, but why are they not coming up with the market on a basis when rates are this low for this long. and even as the earnings haven't been good. >> rates are too low. banks don't want to lend money out. why would a bank want to lend money out to the housing market when they could give it back to the federal reserve and collect a check. and look at loan growth and we're seeing it clip away to the upside. but we're not seeing it to the point where banks are saying it is super profitable for me. >> you are anti-home building as well. >> i am anti-home builder. >> let me look at the economics on this. we saw a great home building sentiment index but when you overlay consumer sentiment which last friday the michigan consumer sentiment had turned down and you see it turned down
well before the home building does for the last period and so for me the last uptick that we saw in the data today could be people saying, you know what, maybe rates have reached the bottom, the last little hoorah of buying at this levels so i don't want too be in home building. >> a lot of them are not keeping up with -- >> but someone like pulte. >> someone like pulte is probably going to have north of 15 and this year in terms of eps growth when nobody has any earnings growth and probably more last year. and what you said about the macro, it is in the price and what happened and on a company by company basis, i wouldn't say buy them all, but in pulte case, they have a huge buyback coming and they have some accretion of earnings. >> so does the pulte chart look better than the best. >> it is the biggest weight in the group, but that is your job. you have to pick the right one. but as a theme, as a sector, as a bet, i think it is a bad bet. >> isn't home depot it is down
10%. >> and lowe's. >> and you are a seller. >> i'm a seller. you're a seller? >> you're neutral. >> i think you will see them -- we've seen the bottom of the home builder. >> and i think home depot got expensive then. >> perfect market. >> there you go. >> chart master, thank you. carter braxton worth. up next, the bank on more gains, wells fargo surging after a call on the street and is a bottom in for the baetsen down bank and we'll explain. and we have wall street analysts with the biggest upside in the next 12 months and we'll tell you the names and whether the traders are buying any of them. and edward kai wins fda approval and so what is next for the stock and we'll hear for the interim ceo on a first interview later in this hour. we'll be right back. ut is it the right the one for her? is this really any better than the one you got last year? if we consolidate suppliers what's the savings there?
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[ clock titime. ] you only have so much. that's why we wanna make sure you won't have to wait on hold. and you won't have to guess when we'll turn up. because after all... we should fit into your life. [ laughing ] not the other way around. [ clock ticking ] welcome back to "fast money." general motors kicking off the top trade, surging to 2.5% after morgan stanley upped it from 37 to 29 and the analysts behind the call saying gm could remain
relevant and profitable for longer than the market thinks during the transition to autonomous vehicles. >> relevant. that we are using that term with automakers. i guess we may have to. with gm what is relevant, if the earnings are flat, this company is ridiculous cheap. people don't want to own it because they believing it not relevant. and they made that clear as well. >> the stock has really been not doing very much for the past five years. >> it has been sideways with a nice dip. >> and very healthy fundamentals. >> but we've had an unbelievable run in auto sales. so they can't perform in that environment, how are they going to perform in a flat to down environment. for me, i'll go back to one of timmy's favorite stocks, auto nation. and down 1%. that is the one -- >> if you don't own auto nation, you are not watching mark richt. >> you should follow it. >> you should. >> the stock is down 6.5 and 7%
and a almost 4.8% dividend yield and a stock that went sideways. and this is a yield proxy where you are getting paid to stick it out and maybe there is some electric vehicles sort of play at some point in the nonprofit too distant future. i would long it with a 30 stock to the down side. >> i like to trade that way. >> and we'll looking at flat earnings. if expects are for a lot worse than that, right, then i say you have to own the stock. so i would own it for the dividend yield and lower expectations and flat earnings in 16 or 17 or 17 and 18 if you will. >> you don't buy the notion that the stock has had -- and the stocks in general have had every single catalyst they could possibly have in the past year or so. >> so it is all -- for me, it is not -- it is about expectations. if street expectations are super low -- >> they are terrible. >> the stocks will rally. and so therefore it is a buy. in my opinion. and i agree with tim and dan because there is a dividend yield there.
so those two pieces of information say to me -- >> you are long gm. >> i look at the industrials and a big debate out whether there is cyclicality in the economy and we'll see what will rally these things at these numbers. flat eps is bullish for gm. that is fine. that is all you need. still ahead, the biotech stock that surged more than 90% and burned up the ticker at the bottom of your screen all day. we are talking about sarepta on the back of the fda ruling. i'm melissa lee and you're watching "fast money" on cnbc, first in business worldwide. here is what else is coming up. >> these prices are insane. >> that is what wall street is saying about four stocks that they see surging in the next year. we'll give you the names and tell you whether you should be buying. plus 50 days until the election from hell conclude and with the candidates locked in a dead heat, we'll tell you what changes you need to make to your portfolio when "fast money" returns. what powers the digital world? communication.
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welcome back to "fast money." trailing the s&p, well if analysts targets prove right some of these stocks are set up for a big pop. to find out which ones we go to a man always on target, dom chu. >> there are probably some traders who are hoping some big cap stocks stay on target. so we went hunting for those target prices where the implied upside is pretty big. there are 20 stocks in the s&p 500 where the average analyst target price as polled is 30% higher than current levels. among the notables, sales force.com has around 30% upside in analyst targets are right. 93% of analysts had a buy rating
on sales force. you have a couple of travel related names. delta airline, they've had some dush lense losing a quarter of the value in 2016 but they think there is a potential of a 38% gain and 88% of analysts have a buy rating there. there is always royal caribbean, the cruise operator could see 40% upside if the analyst target price comes to fruition. 89% of analysts have a buy rating there. and one more controversial one. first solar shares have taken a big dip in the last six months but the average target price has come down but still 60% higher and only 37% of analysts who cover it actually say buy. 58% say hold and the rest say sell. so the caveat applies, analysts don't always get it right but that is what they are saying about these stocks in particular and there are interesting names. back over to you guys. >> thanks, dom. >> so which stocks would you guys own and which calls do you hate? >> well, you know, in general
they are saying 80% to 90% of the analysts already have buys on them. so what is the catalyst, what is coming up. that is what i don't like about the whole list. but of the stocks, the risk reward on crm, that looks the best. >> the most expensive stock in the bunch. >> two detactors off the back. >> where is the reward. >> this is an easy one. no, it really is. a couple of weeks ago we were sitting here and watching the trade around the levels that it is. it came back a little bit. i think the ceo did an okay job explaining some of the deceleration and booking but here is the problem. they are expecting to do about a dollar in earnings in fiscal adjusted basis and that is 30% on a gaap basis and decelerating for a company that trades where it does and i think this is another issue, they try to make a bid for linked-in and it would have been about $30 billion and what is going on there and so something is going on. >> listen, at $73 you don't have
much of a risk. you have a down side. >> well, listen, you like to hold stuff, if they grind into the earth, that is fine. but buy it with a dollar risk. >> what does that mean -- >> grind it into the earth. >> until they go down, down. they are saying he is wrong. but i want to go on to another names. >> delta. >> okay, delta. >> the pain around the airline industry is about the age-old question of can they be disciplined and cut capacity and they started to. very small cuts. they expected 90 bips of pullback. and if you get to a place where they are showing some small increase in passenger revenue per available seat miles, the market will explode. the valuation has them at recessionary pricing right now. >> i agree. delta is the only names i would buy. i look at a name like solar, i'm not touching or royal caribbean, maybe the analyst expectations haven't caught up with what could be occurring there. zika, we've talked about it on the show and what the impacts are being as far as travel
bookings with the royal caribbean. i wouldn't touch it with a ten foot pole. >> and what about zika. >> and jet blue flies to the southern areas. but i look at royal caribbean, they are absolutely dead on exposed. would you stay away from that stock. and watch. these numbers need to come down. >> and this is a consistent theme. we talked home builders and autos and airlines and they all trade well below market multiples and trade poorly relative to the s&p and poor relative performance and they are getting cheaper and that is a theme that you -- >> i don't think it is cheap. home building is to show some earnings and i think many of them trade expensive. but in the other case -- >> cheap is getting cheaper here in sectors. >> we've been in an earnings recession and we know that and that is why buy these stocks. >> and up from a few percent from the all-time highs. >> the s&p is doing what it is doing. >> right.
>> so be careful when you look at ratings and the way analyst rate stocks are 12-month targets and 12-month time lines. >> they are usually wrong. honestly. we are going through the list and they are usually wrong. >> if i own a stock, i won't talk to an analyst that has a consensus rating on this stock. >> you won't talk to a lot of analysts. >> still ahead, we are just 50 days away from the -- that is a majority. john harwood will way in. and later one of the most influential media analysts on the street who hardly ever talks to the media is talking to us tonight. bank of america jessica reef cohen has a call on who will win the battle between content and distribution. that is next on fast.
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laggard sliding 1% after last week's record run. here is what is coming up in the second half. ed media analyst that hardly ever talks is talking to us tonight. jessica reif cohen is sticking with disney and her difference between content distributors and providers. and a stock that saw a surge of 90%, the ceo of sarepta is here and sitting down on a first on cnbc interview. but first, believe it or not, we're 50 days away from the election. the latest poll suggests the race is a virtual tie and yesterday city group said they are underestimating a trump victory that has a 40% chance of happening up from 35%. and john harwood is going back in time to make sense of the latest poll numbers. john? >> melissa, in the era that we are in now, it is always smart to bet on a closed presidential race because the country sorted itself out into two evenly
divided parties. let's go back and look at history. in the post world war ii period you had a pattern of recurrent landslides in presidential elections. eisenhower in 1956 and lbj in 64 and reagan in 84 and all of them got more than 55% of the vote and more than 400 electoral votes. that is a huge margin. now you look at all of the elections in the 21st century, in the era of polarization, much different story. start with 2000. that was the first race in more than a century in which the loser of the popular vote actually squeaked by with 271 electoral votes. that was george w. bush. and then four years later, he got 51% of the vote, under 300 electoral votes. president obama had a wide victory in 2008, got 53%. 386 votes and below the 400 margin as he was in 2012. so when you look at the numbers now and see hillary clinton in the polling averages with just a
1% point lead over donald trump and the fact that the electoral map is divided with hillary clinton with about 200 leaning her way and donald trump with 164, a whole bunch in the middle. that is par for the course in modern politics. >> in terms of lately, john, who has the most momentum, it does seem like trump is gaining momentum here on clinton? >> yes. trump has had the momentum in the last couple of weeks. hillary clinton, after the democratic convention and some mistakes by donald trump, build a substantial lead. that lead has now shrunk. he is bringing republicans back to him and taking states that were battlegrounds and moving them in his directions, like iowa, florida, ohio. but he hasn't won the election yet. she still has a narrow advantage in the popular vote and if she holds that advantage she would win the electoral majority but we have debates one week from now and that will start the real final phase of the action of three presidential debates, one
vice presidential, a lot on the line on those. >> it is a long road still. john harwood in d.c. so back to the desk here. why does the market solutions care about trump gaining in the polls. or not care. we don't know what he's going to do. he is the wild card here and he means volatility. >> i think we've had volatility. and we've talked about the correlation and the horrific events in new york over the weekend add to trump fervor or whatever this is that is driving people out of this campaign. i think about the economy and we all know that the deficit perspective that neither hillary or trump are attractive for the deficit. but if you think about the one fundamental thing trump means for the economy or companies in the market in the next phase if he's elected is the tax issue. and i think off shore repatriation and also those companies that have been unwilling to invest. somebody like ge, they are waiting for ania new administration to go harder.
and apple and google, a lot of cash to bring back. >> and there are a couple of things. but the only problem is if trump is in, you will get a strong dollar which will hurt the exporters. and on the other side, this is my view on why wall street has not panicked, because with trump you know you will get a massive fiscal simulus which will help out the economy in one way or another and that is what people are balancing. that being said, i still think leading up in the next couple of weeks, massive -- >> and how about if trump takes the lead and starts going on, and remember what he said about fed chairman yellen and i'm dead woman walking here if he wins this thing, you know what -- you said you are ashamed at what i've done with rates, maybe 50 bips, that first one, how about another 25 on the way out. you know what i mean. i'm just saying -- >> wait, wait. he won't even be sworn into office if he wins and you think -- >> why. >> because he gets sworn in in january. >> why wouldn't she do this. >> so the fed will be political to keep her job?
>> no. >> no. >> hold on. >> but you are adding validity. if she does that you are adding valid to trump's claim that she should be ashamed of herself. >> you won't have a personal vendetta to throw the economy into -- >> and they've said they want to do this and jeff gunlock said they want to free themselves from the market dependency and they can't do anything and i said before if they do something before the election and give this lunatic, an assist into the oval office -- >> unless they do it and the markets don't react as strongly as they think. >> i think markets have already reacted. let's face it. markets have had the run-in. whoever is in the white house, i think we're disappointed in november. and i think trump would be terrible for the dollar. if you get walls and trade pacs are cut but the reality is we have a deficit, we are raising the dollar levels, it is
negative. >> toss a coin in the air. markets are more focused on what will happen in japan and with the fed right now. that is what the near term focus is in the market. but if trump does get elected, how do you invest. what do you look at? i'm still stock specific. you will see sectors trade in very different ranges. i don't necessarily believe that a clinton presidency, that she's going to be able to get a lot done, a lot more done than obama. i look at a trump presidency and say we may take a near term pullback. >> who rur voting for. >> mexico cement, they will have a big contract. >> it sounds like you are bullish -- >> we need to pay somebody -- >> somebody has to pay for -- for the wall. >> i'm not a status quo. i look and see what do we need. we need to shake up washington, d.c. >> oh, stop it. >> so think about the positive for the economy. >> so trump is -- what is the bottom line. trump will be good?
>> near term trump is not necessarily good for the markets. longer term, however, after he sees -- i'm telling you, you will look back six months after he's elected and gets on the right path and doesn't say anything stupid, the market changes gears and goes into the upswing. mark my words. >> they are marked. they are on tape. still ahead, biotech continuing to surge higher today but could the run soon come to a screeching halt. we'll take you behind the trade that says trouble could be brewing in biotech. and you see her making her way on set, bank of america senior analyst and well respected name on the street, jessica reif cohen joins us for an interview in more than ten years. she'll join us right after this. okay, so what's our latest data say? our customer is a 21-year-old female. heavily into basketball. wait. data just changed... now she's into disc sports. ah, no she's not. since when? since now. she's into tai chi. she found disc sports too stressful. hold on. let me ask you this... what's she gonna like six months from now?
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reif cohen joins us, she is the bank of america and merrill lynch entertainment expect and she just came back from los angeles where they held a special media conference. way too long. so what happened at the emmys. in terms of game of thrones. do you see that as a sign of direction of where your space is going? >> well, i mean, there were a lot of wins last night. the o.j. drama also won a lot. so it is pretty concentrated in a few networks. fx and fox did well. but there is so much original content and the appetite by consumers iss in sabrable. >> it seems like the companies that produce the content may have the upper hand. is that oversimplifying. what were the theme coming out of the conference last week. >> there were a handful of
important tv producers. there are a lot of companies that don't make it. there is no way to create 500 hits. so the companies that are bigger will do well. cbs, time warner. sony has a lot of -- fox won a lot last night. so there are a few really important content-makers. but distribution is key. and i mean, we're all going mobile. mobile video is really the most important trend that is happening right now. and you need distribution. you need to have a strong broadband connection and that typical distributors and paid tv operator and cable is the top as well. >> and you are pointing out that steve burke of comcast, our parent company, had a great presentation. >> yes. >> what made that stand out in your view? >> that was one of the highlights of the two days. nbc universal does not present a lot so this is pretty far-ranging.
and he -- you've owned or comcast has owned nbc u for five years and more than doubled operating cash flow. having said that, there is so much opportunity in every single division. whether it is broadcasting, which everyone thought was like an old, stodgy business. the nbc retransthis year is $800 million up from nothing but well behind the cbs stated goal of $2 billion by 2020 and nbc will be a fast follower. telemundo, which has always had ten or 15 or 20% of ratings is sometimes gaining versus the primary competitor and there is a long catch-up in terms of ebidta. film has been on fire basically almost a break-even business when it was bought. and there are so many franchise. whether it is despicable me, fast and furious, 50 shades of gray and the dream works animation is a huge driver for animation and consumer products, theme parks and theme parks are -- there is a runway, like,
we've never seen. >> this is your pick. >> this is a top pick. but the most well-run media company. it is incredible. >> you made a great point about over the top versus the cable. so the nbc universal, they have it all, right. so they have all of the distribution but the content. are we going to see more deals like that? i've tried an over the top thing and it is a disaster. try watching live -- on your international, sling tv, it is a disaster. will we see cbs and viacom and other guys pair up with the delivery mechanism. >> interestingly, comcast or nbc u. was the most negative. it is not that attractive or that cheap. but for certain people -- for certain segments of the consumer population or viewers, $40 for a certain amount of channels may be okay. but cbs is really the most aggressive with direct to consumer offerings. they have a million subs and showtime a million subs and the publicly stated goal is 4 million over the next few years, 4 million each.
so there is a business model but they are small. they are not that big. the really big players are still the diversified media companies. >> so cbs said they are not in talks with viacom, whatsoever. should they be? do you think they really are? >> he did say at our conference last week that they are not currently in decision for m&a. the story will unfold over time. and we'll see. you can -- it is very easy to make a financial case strategically are viacom the right assets for cbs, that is really questionable. >> are you getting more pessimistic about viacom's options because not only did moon vest say they are not in current discussions but murdock indicated he is not interested in the assets. >> murdock was clear viacom is not on their radar. but i wouldn't rule out cbs. viacom needs a lot of help. we have an underperformer and
have it had for years. it has been completely mismanaged or under-miff mana-- could have been managed better. they have the most challenging trends because of the demographics and haven't reinvested in the business. and having said that, there would be a line down the block to buy nickelodeon and there are assets that could be fixed and there is no reason paramount under the right investment could be fixed, absolutely it could. so would this make an attractive acquisition for a company, the story is not completely done and maybe cbs or it may be somebody else. >> thanks so much for stopping by. we hope you come back again and make it more frequent. jessica reif cohen on the heels of the first immediate caw conference last week in los angeles. so how do we trade media here, tim. >> jessica pointed out, it sounds like content has a major
premium attached to it and if you think who has control of it, you can't forget about disney which is underperformed and yet -- this is what they have. i think comcast is certainly a first class company. i look at the valuation. 9.5 and 9 times ebidta relative to anything else, cbs is the relative play. if i was relative value, that is what i would do. >> after the break, the ceo of sarepta joins us for a first on cnbc interview with the stock ending higher by more than 70%. what is next for this company? interim ceo ed kaye joins us next. you're watching cnbc, first in business worldwide.
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a historic day for sarepta. the stock skyrocketing more than 70% on the fda decision to fast track approval for a drug used to trade mus call oar dystrophy. they are at the highest level since 2002. meg tirrell joins us with ed kaye as interim ceo. meg, take it away. >> dr. kaye, thank you for being here. a historic day for sarepta. what is next for getting the drug out on the market and to patients. >> well, we're very excited. and i think we're very excited for the patients. they've been waiting for a drug like this for a very long time. so our focus is going to be to make sure that we get the drug out and to the community and into the boys as soon as possible. we're ready to launch. we have sales force. we have distribution centers ready to go. we have reimbursement people
that are active and in cambridge and ready to work. so that will be the first focus and making sure everybody who wants the drug can get it. the next thing we're doing is making sure that we're working on our other products that can address many more boys with muscular dystrophy and in the pipeline and we're trying to get those out and we have a next generation therapy that we are working on. so we have a lot of programs, we're very excited about it. we've been waiting a very long time to get this done. and we believe that the patients are looking forward to having access to the therapy. >> i've heard from some of the patients today and they are saying they could breathe again. it is amazing hearing from the patient community. at the same time this was a surprise to the investor community and the biotech analyst community. the notes coming out, rbc calling this one of the most perplexing and calling it extremely unprecedented, what do
you say to the people that this was a bad decision by the fda and there wasn't enough data and they shouldn't have approved this. >> well, i think we're in a new era of really interesting science, personalized genetic medicine. and this is an ongoing discussion with the fda. and remember, there is a lot of legislation that has changed for orphan diseases. and making sure that you could include all of the data. remember these are very small populations. they are complicates science and personalized genetic medicine and so i think the fda used the flexibility that is in the law to try to get this approved. so i think you're going to see in the future is many other companies like sarepta that are trying to push the envelope scientifically and to try to use the law as it was designed -- and really the purpose is to get therapy to patients as soon as possible. and so i think the fda followed the mandate that they were given and they worked very hard -- and
i commend them on getting this done. >> and dr. kaye, last week one of your biggest critics on the fda resigned. did that provide the clear path for this drug -- is it a coincidence this guy resigns last week and the drug is approved this week? >> you know, we don't have really any insight into that whole process. and i think dr. farcus whos had been critical, but i think it is a lot behind the scenes that has gone on and i think it is not related to one reviewer. i think it really was looking at the totality of the data and there was a decision that need toad be ma -- that needed to be made and it took some time. and hopefully for the next drug we'll make it easier for the fda to have a simple process for a clinical trial. but i think based on the information, they had to make a decision based on the information we gave them and they did. >> dr. kaye, so much more to discuss but we are short on time. we have to let you go there.
but thank you so much for joining us. >> very nice to talk to you, meg. thank you very much. >> ed kaye of sarepta. so what do we do here with the stock? >> well, i don't know what you do with the stock after a 73% move after a stock that is up and down. it seems like the fda blinks and this has other implications. >> you buy it here after the rise. >> after the rise. >> why? >> because if you are a parent sitting at home there is no way you won't advocate for your child to receive this drug. and i could tell you, massive public out cry to put the fda to approve this product. i can't imagine there is pushback on that in my opinion. >> quickly, meg, because we are out of time, because there is more drugs in the pipeline, more drugs -- >> sarepta is working on other mutations as well. and it could be a takeover target and that is one thing we didn't get to ask them. which next time. >> thank you. meg tirrell. despite the big day for sarepta, there were notable bets against biotech over all.
dave is at the sport board. >> the biotech and the xbive, when sarepta was up about 70% at the beginning of the day, there was a buyer of the october 63 puts paying $1.84 for 5,000 to open. and here is the thing. i don't exactly right away think that is an outright bearish bet. it could be a hedge against a long portfolio of biotech stocks and it is important to think about what meg just said, this could launch a wave of m&a that is good for the sector and buy protection into the head winds with the presidential debates coming out. look at this consolidation, it broke out at 65 and has great support at 60 and those puts give you protection below 61. and it broke the down side in place for the all-time high and that is $50 so maybe if you are long the biotech stocks and you want protection, i wouldn't think this was an out right
bearish bet. >> thanks. up next, final trade. hey gary, what are you doing? oh hey john, i'm connecting our brains so we can share our amazing trading knowledge. that's a great idea, but why don't you just go to thinkorswim's chat rooms where you can share strategies, ideas, even actual trades with market professionals and thousands of other traders? i know. your brain told my brain before you told my face. mmm, blueberry? tap into the knowledge of other traders on thinkorswim. only at td ameritrade.
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>> sarepta. i gave you all of my reasons before. buy the stock. >> b.k. >> watch natural gas and buy apache. >> everything should be sold. >> "mad money" starts right now. 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 is not just to entertain you, but to educate and teach you. so call me at 1-800-743-cnbc or tweet me @jimcramer. how do you remove the fed and oil from the story of this market? how do we get the focus back on individual companies? not the overall obsession with what the