Skip to main content

tv   Fast Money  CNBC  May 8, 2017 5:00pm-6:01pm EDT

5:00 pm
convertible bonds either. >> i thought you were going to say they had convertible cars. >> pencils down, end of show. kelly, we'll see you tomorrow. that does it for "closing bell." >> thank you so much. >> thanks for joining us, everybody. "fast money" starts right now. see you tomorrow. "fast money" starts right now. at the nasdaq market site overlooking new york city's times square. on fast, apple gone wild. the stock soaring to all-time highs as the market cap passes $800 billion for the first time ever. 30% in 2017 alone. can you still get into the name? the street is on fire with media deals. what could be the next mega merger. the traders make their big predictions. and betting big on one group of stocks. we'll tell you what they are and why they have more room to run. but first with ekick it off with the sohn conference.
5:01 pm
scott walker will be talking to th gundlach in a moment. long emerging markets. tim sea mour, you're an eem merchant. >> this is a trade i've been long for a long time. i actually think emerging looks good against the etf. if you spread it over the spy, you can see the ratio, somewhere around 16.8 right now. some key levels to break through. emerging is absolutely out from the s&p. a lot of the bogeys for em, really, the big hurdles for em have been dollar related, growth related. those economies are starting to move. if you want to see a trade, we talk about this on the show, this is the trade. emerging is underperforming the s&p by almost 60% from the peak of april 2010. and if you want to look emerging
5:02 pm
markets that took fire in 2003, 2004, 2005, you're back to square zero. that's exciting. >> it feels like the short spy side of the trade might be a little trickier. we were talking about how it's difficult to not be long at this point. the s&p 500 with the volatility so low. >> listen, i can't speak for mr. gundlach, but i don't think he's looking for a complete wash on the s&p as he's looking for significant outperformance in eem. the s&p short is just sort of more of a hedge, i would imagine, in my opinion. he can speak for himself. tim, real quick. i think '07, '08, we've never gotten remotely close to the eeo 5. you're talking about something that probably has the wind in its sails. >> you have to wonder how the short position is being put on with volatility so low. there are a number of ways to do that. >> it's cheap to do. you can do it with options.
5:03 pm
think about what this trade structure looks like. if you're betting on eem rg betting that china's going to do better, because that's a huge portion of it -- >> given the data -- >> well, we actual l i saw weak data. we've had really smart people come out and say, you know what, there's something going on in china that's not good right now. at the same time you had d.j..com come out with unbelievable earnings. it's unclear to me whether or not a long-run prospect, or short run china will have a problem. if you are long china, and china blows up, you'll be fine. it looks like a decent hedge. >> it is absolutely a hedge. i think tim nailed this. you've nailed this for a while now. the data coming out of china scares me a little bit to go longers em being short u.s. right now. i would rather be long europe than long the u.s. so i would actually put that trade down versus what gundlach suggests. >> we need to believe that interest rates will remain relatively low in order for that side of the trade to work.
5:04 pm
>> i think you do. i think you need to believe the dollar is going to remain this strained. the underperformance has been currency related. we're at a place where i think maybe the dollar in the short run is stuck here and that's good for the eem. >> let's go out to the sohn conference and scott walker. >> all right. melissa, thank you so much. listening to the confers, we will just pick up with jeffrey gundlach. great to see you. welcome. >> thank you. >> these guys on the show were just talking about the call you just made. short spy, longers em. >> yeah. >> why this call? >> it's the valuation of emerging markets, is half the valuation of the s&p 500. when you look at things like price-to-sales, price-to-book, and i think part of that valuation difference has been based upon, one, the dollar had been strong. from 2011 until 2015. that usually correlates with em
5:05 pm
underperformance. i think that's part of it. the rest is that i think passive investing is something to use a word i don't like, bubble, where i think people greatly overbelieve the idea that passive outperforms. there's a birth right to outperform all active managers. in fact, there's incredibly predictable cyclicality, and the passive outperformance has been very similar to how long they've lasted historically. so i think that you're going to have active management, as i said, to use the mark twain quote, the reports have been greatly exaggerated. there's a lot of -- really, a macro call based on valuation. you do have to consider the dollar as part of this. >> so you're suggesting that so much money has been flowing into passive investing, that it is overstretched valuations versus
5:06 pm
of the s&p 500 versus -- >> you can use europe as well. europe is more popular. people feel more comfortable with it. i just think em has more potential upside than even europe. so, yeah, i think you look at market share global stock markets, u.s. is over 50% of the global stock market. but it's under 25% of gdp. so there's just something wrong with this picture. i used an exhibit of if we didn't use the morgan stanley world index which is capitalization, but used gdp weighted, then the market would be much lower, the world market. it's the u.s. that's dragging it higher. i think it's a herd mentality that is based upon kind of the repetition of the idea being extrapolated out indefinitely. and i use the metric which i thought was the biggest idea of my presentation that passive investing doesn't even exist.
5:07 pm
it's just rules based. and the s&p 500 isn't even rules based. it's run by a committee. a lot of people think it's the biggest 500 stocks in the country, but that's not true. it's a committee. now, they don't change things a lot, but the chairman, david blitzer, actually was bragging about the fact that they were active managers, and that bill miller called them good active managers. but you're hiring an active manager, you're supposed to look into their selection process, you're supposed to look into their research, how they make decisions. people are blindly handing over their money to an investment committee they know nothing about. it's almost a breach of fiduciary duty on the part of institutional asset pools without understanding what exactly is the day-to-day. >> let's be clear as well. even though you say short spy, you're not calling for the s&p to fall out of bed overnight. in fact, you said during your presentation that the s&p could
5:08 pm
outperform in the short term. >> i said on your show, on fed day, march 15th, i said, you asked me can stocks move higher with your interest rate call being correct, which was that we would get a tradeable rally off of slightly higher than 260, the global 2 and a quarter. my answer was yes, you can have both of those happen. because the bond call has more to do with ridiculous positioning in the market. it's not really based upon tremendous economic softness. the s&p 500 will not have an attitude change just because the ten-year goes down by 40 basis points. that's what ended up happening. i did think if interest rates fell, and they did, that financials would probably have a short-term underperformance. we talked about that, too. because people like to see interest rates go up at the long end in particular when they're interested in financials. i thought that was a countertread move. i thought it was very interesting we did get below 225. my target was 218. we got to 217 on the close.
5:09 pm
i always use closes. if we go back above, particularly above 230, well, we're rejecting this sub-225 level which means the rally could very well be-. now we're up at 238, which is solidly back in the range where we spent so much time. the only thing that is -- there's a couple of things that i argue against significantly higher int rates, which is copper to gold. gold has been weaker lately. copper had been weaker earlier. but that ratio was indicating lower bond yields. another thing that was indicating lower bond yields was absurd overpositioning, short the bond market. the day, the week that the ten-year went below 220, you went from one of the largest short positions in history to the specs actually went long below 220. all these people positioning short at 260, many of them canceled that trade and somewhat long at 217.
5:10 pm
i think that that's -- that alleviated the oversold. >> are we in now the strengthening yield trend? or is this short-lived? where is the ten-year yield going to be at the end of the year? >> i don't fall for that trap anymore. one year i said it was going to be at a level and it was there three days before the end of the year. then it moved like 20 basis points the last few days, so they said, you were wrong. i've been talking about this since 2012. so it's coming on five years. the history books will say that interest rates bottomed in july of 2012. the two-year bottomed in 2012. it was rejected in a matter of a day or two. i think we're in a longer term secular upmove in yields. but that doesn't mean you have to be terrified of bonds yet. because i like to quote earnest hemingway the sun also rises.
5:11 pm
how did you go bankrupt, bill asks? two ways. first gradually and then all at once. that's the way bond yields bottom. i made a statement in my july webcast that i think the next presidential election, or maybe a year after, but somewhere in that context, the ten-year will be at six. >> people need to listen to you when you talk presidential elections, by the way. >> i predicted every presidential election correctly since 1976. actually, 1972. >> for those of you who don't know, last year here at sohn, you said donald trump would be president. >> i said that in january before the primaries even started. so it's memorialized there. but i think that you could easily see a perfect storm of bond issuance, thirst for nominal gdp, corporate bond maturities rolling-. qe has to be rebought by the fed or sold out to people like me.
5:12 pm
on behalf of myself and my clients. so i think there's going to be tremendous bond interest. and then there's the deficit. i alluded to it briefly this year, donald trump i think is very comfortable with debt. he's built whatever empire he says, he said, i love debt, he doesn't want a strong dollar. trump in one year ago just about today, may 5th of 2016, had a quote, i showed my presentation, a strong dollar sounds great but in reality causes trouble. it's not nearly as good as you think. a month ago, in april, he came out and said, i think the dollar moib too strong. so i just don't think donald trump can get satisfaction delivered to his voters with a significantly stronger dollar. it's just not going to help american jobs. it doesn't -- >> you know, higher rates, it doesn't lead to higher dollar, which leads to -- >> no, i showed that in my
5:13 pm
presentation. it's an urban legend. everyone says, if you just say this to a crowd, everyone will move their head in a north-south direction and say, oh, yeah, fed tightens, dollar goes up. i've been trying to disprove it for 18 months now when i turned nur tral on the dollar from the move from 75 to a hundred. it's just not true. there's been many instances of sequential fed tightening that the dollar just went sideways. it happened in the '08s, it happened in the '90s, and it's happened this time. the feds started tightening in december of 2015. the dxe was above a hundred that day. it's lower than a hundred today. the dollar is not strengthening. we've raised it three times. i'm not saying that the dollar must weaken -- i've been neutral. i've had moments of negativity. i haven't had a bullish dollar fall really though since i was bullish from the middle of 2011 until december of 2015.
5:14 pm
these markets, particularly currencies, are tremendously anticipatory. the reason the dollar went from 75 to a hundred, there was the understanding that the fed was itching to start raising rates. they anticipate. so it's after things become obvious, or that there's momentum in a move, where suddenly everybody gets religion. like the short sellers of the ten-year when it got to 201. suddenly they give up on their short. rules based investing can be accomplished in a rules based way. the s&p 500 isn't even that. i have a rules based fund. it's called dseex. it's outperformed the s&p 500500 basis points every year since its inception. so it's possible if you have a good economic theory behind the rules based investing, but just some shadow committee choosing your investments, i'm very against that idea. and i really think that it's a fair trade, as you said.
5:15 pm
not that i'm short the s&p or bearish on the s&p, it's a relative performance game. like my pick a year ago, i said long the mortgage reits, it's up 40.7%-that time period. i wasn't bearish on utilities. it was a relative value. >> i'm glad you explained that. last, but certainly not least, twitter has its newest -- >> yeah. >> newest tweeter. >> yeah. i've been trying to avoid social media since it came into existence when al gore claimed to invent the internet. basically i have seen so many articles and reports about my investment strategy, my results, calls not made that i never made, that i'm just tired of getting false news out there. so i decided when i see something that's factually incorrect, rather than trying to get a retraction that nobody's going to read, it's going to be on #truth gundlach. we started this morning, i set up the account in the car on the
5:16 pm
way over here, with one tweet, which is test. so that's all there is now. and one follower. to whom to test it with. now i think we have a few thousand already in the last hour. >> i think you do. i think you have a lot of people following you. jeffrey dpund latch, thank you so much. >> thank you. >> that is jeffrey gundlach. melissa, back to you. >> in fact, 2,047 followers so far. jeff gundlach elaborating on his call. but also, talking about a number of other things, including the falsehood, had esays, and the belief that rates and dollar must move in tandem and the overreliance on passive investing, mainly through the ets, and what that causes. >> in the first place i want to go to is starting to show with his short skp, long eem, wasn't necessarily bearish on the s&p. it's more of a hedge.
5:17 pm
i think we tried to clarify that. and mr. gundlach just did. the trade probably does make -- being long eem on its own probably makes sense. >> the passive investment that he laid out there is a important thesis. it's where is the money coming from. it is institutional money, retail money. right now, it's been for a long time retail money flying into this market. he's a hundred percent right when you look at the valuation of the stocks. especially the s&p 500 near the etfs. their valuations are sky high. >> it goes both ways, though. >> it does. >> it can also drag down valuations unfairly as we've seen. for instance, right after the hillary clinton -- >> i tell you what, if you're an investor looking for a hedge, it's never been a better time to use etfs and index funds as hedges. as a hedge fund manager, investors used to give us a hard time saying we are hedging with spies. it was always taboo to talk
5:18 pm
about this. when these trades weren't so crowded, it probably was, we called it like -- it was basically a sleep at night hedge. it didn't mean anything. now when these are -- right now, being short triple qs, you think have value, is a lot of sense to me. i just -- the dollar has been sideways for a long time. and it's going to stay that way. >> comments on the dollar, it has been sideways, right? he's saying donald trump does not want a strong dollar. >> we've got details, plus the telecom space is on fire. what could be the next big deal? later, the oracle of omaha, what they are and why he's so bullish. much more "fast money" still ahead. [vo] when it comes to investing,
5:19 pm
looking from a fresh perspective can make all the difference. it can provide what we call an unlock: a realization that often reveals a better path forward. at wells fargo, it's our expertise in finding this kind of insight that has lead us to become one of the largest investment and wealth management firms in the country. discover how we can help find your unlock. dearthere's no other way to say this.
5:20 pm
it's over. i've found a permanent escape from monotony. together, we are perfectly balanced, our senses awake, our hearts racing as one. i know this is sudden, but they say: if you love something... set it free. see you around, giulia ♪ on a perfect car, then smash it into a tree. your insurance company raises your rates. maybe you should've done more research on them. for drivers with accident forgiveness, liberty mutual won't raise your rates due to your first accident. switch and you could save $509 on auto insurance.
5:21 pm
call for a free quote today. liberty stands with you™. liberty mutual insurance. the shlike a bald penguin. how do i look? [ laughing ] show me the billboard music awards. show me top artist. show me the top hot 100 artist. they give awards for being hot and 100 years old? we'll take 2! [ laughing ] xfinity x1 gives you exclusive access to the best of the billboard music awards just by using your voice. the billboard music awards. sunday, may 21st eight seven central only on abc. welcome back to "fast money." the airlines sinking despite encouraging words from billionaire warren buffett. they said the industry's worst days could be behind it.
5:22 pm
>> it was a suicidal business for a long time. having the consolidation that came about through the bankruptcies made it an extremely competitive business. i don't think it's a suicidal business anymore. >> buffett also commented on the viral video of the removed passenger on the united flight saying oscar munoz made a mistake with the initial response. is warren buffett right and should you bet with the airlines and bet with buffett? tim? >> i do. i think you should. i think airlines are very different businesses. i think they're trading in many cases, look at delta as if the economy is in a recession. if there's growth there, they're certainly to be owned. the function as airlines as efficient players in their own market is what it all comes down to. delta, analyst on the 11th, always a good day for the stock. these are dividend plays as well. >> efficient player is the key.
5:23 pm
warren buffett said if capacity gets out of control, if they put out too much capacity, that's going to be a problem. that's the key metrics you have to watch. in the short term, how the stocks traded, i would wait for a little pullback. you might take another week or two before you get in these. it's probably not a bad trade. >> valuation is compellincompel. priceline made an all-time high today. still, i think very reasonable valuation-wise. it will be interesting to see how they perform after earnings. a lot of people raising their price targets. >> raymond james today just had their earnings. >> it's all about pricing, all about managing capacity properly. i think brian's right, i think you wait and let this group trade a little bit. i'm looking for lower levels. if there's one stock to buy, it would be delta. >> still ahead, two big travel stocks, hertz and marriott reporting moments ago. hertz tanking, while marriott is higher. i'm melissa lee.
5:24 pm
you're watching "fast money" on cnbc. in the meantime, here is what else is coming up on fast. let's make a deal! >> that's what telecom and cable executives are about to do. we'll give you the names that could be the in ex target. plus -- >> fast money is going to las vegas. hitting the strip in search of the hottest trades and talking to the biggest names in sin city. steve wynn, mark cuban and wayne newton. this thursday at 5:00 p.m. in july of '98.oiney i did active duty 11 years. and two in the reserves. our 18 year old was in an accident. when i call usaa it was that voice asking me, "is your daughter ok?" that's where i felt relief. it actually helped to know that somebody else cared and wanted make sure that i was okay. that was really great. we're the rivera family, and we will be with usaa for life. usaa. we know what it means to serve. call today to talk about your insurance needs.
5:25 pm
itbut one i think with quesa simple answer. we have this need to peek over our neighbor's fence. and once we do, we see wonder waiting. every step you take, narrows the influence of narrow minds. bridges continents and brings this world one step closer. so, the question you asked me. what is the key? it's you. everything in one place, so you can travel the world better.
5:26 pm
well wait. what did you think about her?morrow. it's definitely a new idea, but there's no business track record. well, have you seen her work? no. is it good? good? at cognizant, we're helping today's leading banks make better lending decisions with new sources of data- so, multiply that by her followers, speaking engagements, work experience... credit history. that more accurately assess a business' chances of success. this is a good investment. she's a good investment. get ready, because we're helping leading companies lead with digital.
5:27 pm
♪ predictable. the comfort in knowing where things are headed. because as we live longer... and markets continue to rise and fall... predictable is one thing you need in retirement to help protect what you've earned and ensure it lasts. introducing brighthouse financial. a new company established by metlife to specialize in annuities & life insurance. talk to your advisor about a brighter financial future.
5:28 pm
5:29 pm
welcome back to "fast money." we're live at the nasdaq market
5:30 pm
site. the s&p and nasdaq closed at record highs. here's what's coming up in the second half of the show. the vix hitting the lowest level in more than a decade. can the volatility be signaling trouble for the market. we'll explain. hertz crashing in the after-hours. it is one of carl icahn's stories. the market cap passes $800 billion for the first time ever. the tech giant up a staggering 30% in 2017 alone. dom chu is back at headquarters with a look inside apple's core. hey, dom. >> melissa, there used to be only one big apple and you're sitting rights in the heart of it over at the nasdaq market site. but these days the rest of the stock market is driven more and more by what's happening with the iphone and ipad maker than it ever has before. shares managed a new record interday high today. they've been on a tear over the last 12 months. they're up 64% during that time
5:31 pm
frame. record high stock price, record high market value as well. we're hovering just around that psychologically significant $800 billion market cap level. apple stock now accounts for about 3.8% of the overall weighting in the overall s&p 500 index etf. that's more than a percentage point. a full percentage point higher than the next highest weightings, both of the alphabet share classes combined and microsoft after that. during the course of history, that's not nearly as significant of weighting as other companies had during the roaring 1980s. if you look at 1985, ibm accounted for around 6.5% of the overall s&p, emphasis on the big in big blue. in 1981, at&t was around 5.5% of the weighting. fast forward to 2009, exxon mobil was 5%. some say apple has historical precedent to get even bigger.
5:32 pm
some bears say we're due for a stall. there's little doubt apple is the biggest influence on the overall stock market. back over to you guys. >> thank you, dom chu. is apple easy money? the valuation is not as high as an amazon or some of the other hoy flying tech stocks out there. tim, is this a slam dunk? >> no, it's not easy money at all. it's difficult money. here's what's being treated, where the growth prospect, if you think about apple's growth margins, that they now have 70% of the market for phones above $500. which means that they are taking market share in these exclusive very glammed out phones they'll continue to do it. they're slipping in china, where in fact the phones are cheap and it doesn't really matter. they've held on to the whole concept of, we're going to protect gross margins and protect the asp, and they're growing there. $300 billion in market cap in the last year. >> trading like a fang stock.
5:33 pm
>> so it's had a couple of things. the easy money has already been made in apple. so if you're looking for an easy trade, apple is not it right now. that being said, it still has some tailwinds. we saw in the last quarter their services are growing at what the street would expect and what you would want to see. and maybe they have the iphone 8 coming out. you don't buy at all-time highs. but over this year there are going to be times we do a story where we'll say, is apple done, or rotton core, or something silly like that, and that's the day you buy it. i said the headline was silly. >> they reported on may 3rd and i said the quarter was not near as strong as the prior quarter. the highs we saw in april of 2015. has the easy money been made? i probably thought that the last four or five months and the stock continues to grind higher.
5:34 pm
now there's talk of dividends being higher. >> easy money or hard money? >> the easy money has been made. right now i'd say, does the stock have more room to the upside? absolutely it does. this new iphone will be amazing. who knows if it's delayed or not. it doesn't matter. the long story short, the stock is going to grind higher. probably to 570. that's where it stalls. the easy money has been made early on. now this is the tail. i think it's another couple quarters of growth. street numbers are too low. that's the bottom line. >> with apple soaring to all-time highs, is the tech giant still worth a buy at these levels? we have to go off the charts. apple is in good company with the $150 price tag. >> melissa, getting fired from apple is the greatest thing that could have happened to me. that's steve jobs. the greatest thing for me is how
5:35 pm
to read a chart. i have a three great ones, trading around $150. i can get you to $180 on all three. let's start with apple here. you can see beautiful base of support over the last two years. doesn't get any better in terms of a base. the textbook breakout from that base. this is today's move. that's about $20 billion plus in market cap. that's like a snapchat, half of tesla, model three, just today alone. and it gets even better. when we go and zoom out, and we look at that longer term chart here, you can see the setup. very similar to the strong trend we saw from 2013, to 2015. you see this big multi-year base of support. and another multi-year base of support. of course, the icing on the cake is that big base breakout. i can get you to $180. if we do what we did back here which is about 140% move, i can get you to 215. maybe not this year, but there-a case for it. as we move forward, with esee facebook.
5:36 pm
we look at that social network. the only thing that's outperformed facebook is bit coin. slow and steady. once again, stock around $150. this is not a stock that's done going higher. i can also get you to $180. we finish with one of the more controversial names, netflix. what i like about netflix is that weekly chart. that symmetry that we saw from 2013 to '15. very similar trading range. we moved sideways here. we break out, and that's where all the gains from. that's exactly what's happening here. i think there's another $50 of upside. from that breakout $130 gets us up to about $180. the three big companies that have made big moves, i think all of them continue to lead the market. >> come on over. >> unilateral -- i need answers. forced to choose, which of the
5:37 pm
three would you choose? >> apple. >> hands down? >> yes. no hesitation. i think it's been one much the top picks all year basically, and it remains a top pick. the best chart and the best company. we talked about with an obvious catalyst, hard money, easy money. i just like to make money, it doesn't really matter. the biggest consumer product in the history of mankind is like four months away, so why not. >> rich, i'm looking at these and looking at the risk/reward basis. i see the charts go parabolic on a lot of these. what do you look for when they go parabolic? is that a warning sign or trend accelerating to you? >> i think it's a very strong trend. the tree is not going to grow straight to the sky. we would look for some consolidation, and i think as you move into the summer, mid-june, late june, you're going to see volatility pick up, as it often does when we transition into a tougher period of seasonality.
5:38 pm
this is a strong trending market. it's not a four-letter word, it's okay to buy strong sox in a bull market. >> not a four-letter word. i'm going to ask you the same question -- >> would you rather? >> would you rather? >> apple, netflix, facebook? >> netflix is the one. >> oh, yeah. >> oh, come on. >> don't get all -- >> man, that's -- that's the least of all three of them. wide open for competition. i would say apple. the reason is because apple is much criticized services business. in other words, this is a massive business and it's barely begun to grow. >> netflix. i totally agree with guy on this. the second half -- their second half is off the charts. easy comps. the setup there in my opinion is very positive. beneficial for netflix. >> i pick bit coin.
5:39 pm
>> that's not the way it works. >> rich mentioned it. i would pick facebook out of this. you've got this secular change here, facebook taking advantage of all of it with its multiple properties. >> rich, good to see you. sflnkts still ahead, two travel stocks, two very different moves. hertz tanking as hotel marriott moves higher in the after-hours. comcast and charter join forces with a mobile partnership. we'll tell you what it means for the telecom space. with e*trade you see things your way. ♪ ♪ you have access to the right information at the right moment. ♪ ♪ and when you filter out the noise, it's easy to turn your vision into action. ♪ ♪ it's your trade. e*trade. start trading today at etrade.com
5:40 pm
5:41 pm
5:42 pm
welcome back to "fast money." more news coming out of the sohn conference. hi, leslie. >> hey, melissa. we're hearing about another short position today. that's from jericho capital management. josh resnick who spoke a little bit ago recommended shorting frontier communications. that stock has responded accordingly. we also have heard from larry robbins from glenview recently. he had three stock picks that he is still currently presenting on. one of those was dxd, he also
5:43 pm
presented on smc and ims. we had a little bit of news that has come out amid today's sohn conference with pandora. that involves strategic investment from kkr to the tune of about $150 million. this is interesting, melissa, because as you recall, pandora had been in the process of looking to sell itself. it has retained morgan stanley to do so. it had an activist investor in the stock that had been prompting it to sell. you heard from him earlier today. talking about century link. this seems to be the path that pandora has chosen. we're still listening to more of robbins' presentation. we'll get back to you with his justification for urging investors to buy those three stocks. melissa? >> leslie, thanks so much. interesting names. ones that we hardly trade here on this desk. >> fmc is an integrated company, in the fertilizer space.
5:44 pm
this is a brutal place to be investing. i've been long a couple of these names in the last few months. it's not been easy. a name like this comes up at a conference like this, and they've done their work, it's worth taking a look at. >> the ftc is interesting. it's a name we're active on the desk recently. they've got no bid for this as far as covering their shorts. here's a name i think is a consensus short across the board. nobody wants to stay long this thing. they think it's basically a zero shot. >> news alert, earnings alert on hertz and marriott, both remain volatile after hours. >> melissa, a big decliner in after-hours, pretty good volume selling down hertz global, the rental car company. third straight miss. stock down more than 80% the past two years. that's despite having a backing of carl ikahn.
5:45 pm
it's falling in a weak rental environment. because of things like uber, people don't rent cars like they used to. the value backing is loans and bonds, worth a whole lot less. hertz's junk bonds on the verge of being downgraded again. revenue earned on marriott rooms, seeing the top end of marriott's forecast. marriott has been conservative when it comes to predicting anemic expansion over the next three years. the company still sticking to after this pretty good first quarter. but marriott has now upped its pipeline bill to opening more than one hotel every 14 hours as they told us earlier this year.
5:46 pm
marriott bumping up a dividend payout this week by 10%. the stock is on a roll. despite the fact we had two travel executive orders signed in the first quarter. marriott still up 30% since the election. >> thank you very much. let's start off with hertz here. it seems it's at the crossroads in terms of secular trends in the industry between falling used car prices and the rise of uber. >> it's a death knell. it's not going away, in my opinion, anytime soon. b.k. has been on this for quite some time. i don't know what turns the stock around other than at some point somebody coming in and saying, valuation is just too cheap. but guess what, valuation is going to get a lot cheaper, i think. >> it could. carl cannot get out of it on 35% of it. look at the other stuff that carl ikahn owns. he is actually catching the upside.
5:47 pm
it doesn't look good here for him. >> wake me up at zero, that's exactly what's going on in the sector. hertz has been in trouble for four years. it will ultimately get back to a balance sheet issue. now it's too early to do anything. >> i do love marriott. i think marriott is doing an incredible job of growing their business, they're doing it correctly. millennials are spending more money on travel than ever. i would bet on marriott on the long side. coming up, the wireless war is teaming up as comcast and charter join the ring. it could spark a flurry of mergers in the mobile space. the vix falling near record lows as the s&p and nasdaq hit record highs. but you might not want to hit the panic button just yet. we're on to you, diabetes. time's up, insufficient prenatal care. and administrative paperwork... your days of drowning people are numbered. same goes for you, budget overruns.
5:48 pm
and rising costs, wipe that smile off your face. we're coming for you, too. for those who won't rest until the world is healthier, neither will we. optum. how well gets done.
5:49 pm
5:50 pm
welcome back to "fast money." the latest round of the wireless wars, comcast and verizon are making amazing deals to stay ahead of the competition. hey, julia. >> comcast and charter are partnering for one year to improve their position in the competitive wireless market. charter planning to enter the market next year. both reselling verizon airwaves
5:51 pm
within their cable footprint. charter and comcast saying they won't buy other wireless companies without consulting each other first. they aim to save on costs and better compete with the likes of at&t, t-mobile and sprint. they'll partner on billing in getting customers to use their wi-fi hot spots. analysts say this puts on hold any acquisitions by either cable giant. comcast was pretty much flat today on the news. charter trading down-over 3%. analysts say this could boost chances of a sprint and t-mobile merger or potentially charter and comcast merging the regulatory hurdles are likely too high for that. i think it's the first step of probably a longer term partnership. obviously the two don't compete with each other so it's in the spirit of cooperation if you will. i will rule out an acquisition of t-mobile and sprint down the
5:52 pm
road. >> that's not the only deal in that space. shares surged by word on verizon offered to buy the spectrum company. verizon stepping up the offer in a bidding war with at&t, both of those companies saw their shares down slightly. straight path is in high demand here because of its mobile spectrum that will give the owner an advantage in five g. it will be key for everything from streaming video on devices as well as self-driving cars. >> back in january it was mentioned the possibility of a couple of cable companies getting together and buying t-mobile. do analysts think that's a possibility? >> a possibility down the line. but we talked to a number of analysts today and they think the announcement of this partnership between charter and comcast means they will work together in the next year to work out all their back end issues, make sure they figure out how to offer wireless
5:53 pm
services to their customers. but for now, they're unlikely to make one of those deals in the next year. >> julia boorstin in los angeles, thank you. this deal seemed kind of strange. unusual strange, right? what did you think? >> people talk about anti-competitive issues, i think this is a partnership to prove they can do something organically, if you will. if it doesn't work out in a year, it gives them a bigger, bolder statement to go to the ftc with it. so they look at it and say, does it take an acquisition off the table? it doesn't do that as long as they both agree on the structure. within a year one of them can go out and buy -- >> it's an elegant way of sidestepping this. you look at the synergies of cooperating, i won't say they're fat, but there's room to cut some of this out. there's no regulatory issues there. that makes some sense. i agree, it doesn't change the
5:54 pm
consolidation landscape for the industry. but infrastructure to me is where it's most interesting. >> yeah. so look at what's going on in the space. the space is obviously very hot right now. somebody at the beginning of the show saying something happens gradually and then all at once. 5g is coming, people need to be in this space. everybody needs to be in this space. there's going to be a lot in this sector over the next year. >> let's get to predictions. those are always fun. which prediction could be next year's biggest wireless matchups? >> i'm not sure. you look at a company like ericson, which tim knows a lot more about than myself. a stock that's basically going sideways for the last few years. clearly the growth days are over. they probably have to go out, in my opinion, and make some acquisition that will make -- i'm not sure who they gobble up. scary music. >> tim?
5:55 pm
>> an $8 billion broadband infrastructure play. they have a giant, giant broadband bundle. they're selling to the current legacy service providers, selling to guys like google at a time when infrastructure is paying. i think these guys are going to be a target. >> for me it's t-mobile buying sprint. i know some people might think it's the other way around. >> i think sprint buys t-mobile. it's a more realistic combination. sprint needs t-mobile. no question about it. t-mobile does not need sprint necessarily. so i look at both of them up on speculation. if it doesn't happen -- >> that's scary music. shifting gears. mike joins us from austin to break this down. mike, that hasn't happened a lot historically below ten. >> no. actually, with eonly have vix
5:56 pm
data going back to 1990. it's only happened four other times. now, basically when the market goes up, everybody knows the vix tends to fall. the opposite is also true. what happens when we get down to levels as low as this, below ten? in the little data that we have, we took a look and in the one-month return, typically in a situation like this, is about .39%. the six-month return is 6.4%. down 1.24%. i think what happens we know that volatility means averting. if you're at the lowest level it can be, the only way for it to revert is volatility to go up. that's usually not that great for the market. >> yeah. >> i actually think this is one of the better trades out there right now. just a buy volatility. you might want to do it through an options structure like mike's talking about. how much lower can it go? not much. >> check out the if ul show friday 5:30 eastern time. david seaberg, the biotech stock.
5:57 pm
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. and the wolf huffed like you do sometimes, grandpa? well, when you have copd, it can be hard to breathe. it can be hard to get air out, which can make it hard to get air in. so i talked to my doctor. she said... symbicort could help you breathe better, starting within 5 minutes. symbicort doesn't replace a rescue inhaler for sudden symptoms. symbicort helps provide significant improvement of your lung function. symbicort is for copd, including chronic bronchitis and emphysema.
5:58 pm
it should not be taken more than twice a day. symbicort contains formoterol. medicines like formoterol increase the risk of death from asthma problems. symbicort may increase your risk of lung infections, osteoporosis, and some eye problems. you should tell your doctor if you have a heart condition or high blood pressure before taking it. symbicort could mean a day with better breathing. watch out, piggies! (child giggles) symbicort. breathe better starting within 5 minutes. get symbicort free for up to one year. visit saveonsymbicort.com today to learn more. it's what busch is known for. what are you known for? i'm indecisive. scratch that. no, that's right. although... [sfx: buschhhhh] at crowne plaza we know business travel isn't just business. there's this. 'a bit of this. why not? your hotel should make it easy to do all the things you do. which is what we do. crowne plaza. we're all business, mostly.
5:59 pm
time for the final trade. >> long eem, short spy. breaking out 17.50. >> metlife with a nice dividend. >> kit, the stock was up 13%. >> a lot going on here. the truth gundlach.
6:00 pm
aller again. agn. >> i'm melissa lee. see you back here tomorrow at 5:00. do not go anywhere, "mad money" with jim cramer 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 trying to make you some money. my job is not just to make friends, it's to educate and teach you. holy cow. holy cow, it finally happened. a money manager came on television and admitted t

57 Views

info Stream Only

Uploaded by TV Archive on