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tv   Fast Money  CNBC  May 14, 2018 5:00pm-6:00pm EDT

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agilent is part of this group that's pretty strong. >> the market was not up for bad news on that front. >> also down 7.5%. the earning season is overall -- the verdict season -- >> let's figure out what the next catalyst is. >> that does it for the "closing bell" everybody. "fast money" starts now. "fast money" starts right now. livefrom the nasdaq overlookin new york city's time quare. i'm melissa lee. your traders on the desk are pete najarian, guy adami. we've got every crypto angle covered in just a few moments, arthur hayes goes crypto who runs one of the largest cryptocurrency changes by volume will be here. he says something very bullish happened today. place your bets. the supreme court paving away for legalized sports gambling and there could be an unlikely
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group of winners. but first, we start off with a rally that many wish was not happening. talking about the pain at the pump. gas prices are nearing $3 a gallon as oil has jumped 5% in the past month alone. that certainly has helped energy stocks but could higher prices at the pump hit the consumer and send consumer facing stocks reeling? this ahead of a big week, big couple of weeks for retail earnings. >> obviously it's not going to help the consumer. it's clearly not going back from the economy, those incidentals dollars you're spending on gas you can't spend elsewhere. if you go down to the lowest common denominator, if you want to break it down, those stocks can win to it. tim's bit on the energy trade for a while. gas prices are not moving up parabolically in my opinion. it's a headwind, i don't think it means you short the retailers there. >> if you look at some
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retailers, you mentioned a couple dang okay today. walmart and target certainly walmart have not done very well and you could probably connect the charts if you wanted to do the xle. so this is the hole s&p. i would just say obviously the move we've had in energy has had a big run. why were we not giving consumer stocks a big boost when oil prices were cheap. i look at stock by stock. macy's which in the middle of a mild transformation, there are names outperforming even energy here. >> fuel efficiency in cars has gotten so good that people don't necessarily feel the pain as much as in the past. >> it's much more fuel efficient. when you look at the metals they're using in trucks, it has made a huge difference. target and walmart not performing as well. i agree with that. i love what target's been doing
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and how they're shifting and remodeling the stores. 300 stores this year are getting a face lift. they've absolutely gotten under this concept of the small units on college campusesand all ove the united states for distribution. there's a lot of reasons that those names work as well as tj maxx for example. that is pushing right up there. the discounters still will do well. we had a nice bump today in dollar tree. when you look around at some of the discount type names those are the names that i think will do better. >> it was surprising it was disappointing that we had energy price oil going up. we also thought this was going to be the quarter we saw the effects of these tax cuts. we were seeing it on the enterprise, on the corporate level and we thought that maybe some animal spirits would make their way into the consumer. we didn't see that. it'll be interesting to see what that print is for april going forward. i'll just make another point. you mentioned walmart. when you think about walmart, you think about home depot. they have two-thirds of the
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market cap which is up more than 30%. those two stocks are actually down on the year. walmart's down a lot and home depot's flat on the year. walmart's dragged up. >> do you think -- >> good point. >> is it energy related? >> i think it has a combination that maybe the consumer -- even with these tax cuts we know the truth that it really wasn't oriented toward consumers. it's more oriented toward corporates and then when you think about energy moving up, it's a weird combination. >> also consumers in some of the biggest populus parts of the country actually didn't get a whole lot of benefit from the tax deal. they kind of got you know what -- and these -- you get a lot of consumption. walmart, home depot, i think you could make arguments that those valuations didn't make sense two months ago. they don't make sense if you believe the consumer. the consumer has a lot of
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leverage. it's much more important than energy prices. >> that's a double pinch here. consumers are dealing with higher energy prices which may not in and of itself be that big of a deal but when you couple that with the exposure to short-term borrowing costs which had be going higher that could be a really impasse. >> that's not as much of a headwind. any time you bet against the u.s. consumer it's a foolish bet. don't underestimate the u.s. consumer's propensity to spend of the whether or not they should be spending -- >> that's the point, guys. you could've made that same argument in 2000 and 2007 so we're talking about weird things going on. why isn't consumer spending better why are some of these big guys in retail how the market rates them why are they tap out? walmart and home depot. >> the marginal dollars going online. let's be clear. that is something to do with it and i think if you look at some of the -- >> that's a national
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deflationary situation if you think about it for the economy in general. >> it doesn't help. >> you've got to look at the numbers. you bring up home depot. it says it hasn't done a whole lot year-to-date. it hit new highs. >> for two years too. >> so this is a stock that has performed very well. you look at their numbers. each and every quarter the last three, four quarters they've been outstanding. >> we're talking about -- >> you're saying they're not spending. i'm saying you're wrong. they are spending because they wouldn't have growth. >> you just told me i'm wrong. you just mentioned macy's. these are broken stories that are having a dead cat alance. >> costco are not broken stories. >> they're not performing is what i'm saying. >> i think part of the performance has to do with the past and the huge run-up that we have -- >> it's a valuation -- home depot's issue is -- they are crushing the ball. they made investments in their business and i think the housing sector is also should be a
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tailwind for the home remodeling. >> they're growing online and competing and winning. this is one of those companies that's winning in that specific space. >> we haven't touched on one sector that is leveraged to this whole rise in energy prices. the casual dining segment -- why -- >> can't get away from the breakfast bar? >> it's quick serve. it's the same. >> seems to be doing pretty well. >> i understand the mastercard and visa are more an international story. mastercard made an all-time high today. if the u.s. consumer was hurting in a major way today, mastercard wouldn't be trading at an all-time high today, for example. two groups of stocks could be calling into strength of the consumer. let's send it over to our chart master to break it all down, carter. >> auto and housing are the
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biggest things in the entire consumer complex in terms of their import for the economy and those areas of the stock market do not act well. let's look at numbers first and drill down from there. i picked out a few etfs. there's an auto etf. it's 34 stocks. it's $1.1 trillion. there's the construction etf, very similar to the home builders, this is 47 stocks, $533 billion, home builders, 500. the whole thing if you add them up, $1.7 trillion. let's drill down on this a bit. so these are the names in their wading in the top five. japanese name. there's a big u.s. name and european name. in here's porsche and nissan. the key here is that this is home builders and it's very
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skewed in waiting toward the top view. compare that to the xhb which we know has a broader aggregate in terms of things like lowe's and home depot and so forth. let's take all 91 stocks and plot them as though they were single security. that $1.7 trillion and what we know, two things, there's a clear break in trend and here's the line and you can see it. and two, this aggregate is literally straight down. the itbs down 11.5%, the cars etf is down two. this is a stock market that's up a little bit. that relative performance is atrocious. let's look at it just to make this point. if i were to draw a line from here over the past three years, yes, straight up, but no performance relative to the stock market and then worse, now it's actually down absolute and
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it's making new six year relative lows to the market. this is the consumer and it's not good. >> i think carter's got to come over. >> oh, come on. >> no question. carter come on over. ryan will bring the chair. ryan, thank you. so what does this tell us about the overall rally? if we think about the consumer and think about 60% of the u.s. economy is consumer spending, does this mean that everything's terrible >> two things. look at the sector itself. after tack leading -- remember that's as constructed. if you take the consumer discretionary sector and give it an equal weight so the amazon and home depot don't have the impact it's actually down. there is no rally in consumer. it's a few names that have held the sector up and we know that autos, housing are much more important than restaurant sales or things like that. >> i don't know how you measure the fact that the components of discretionary -- you said market
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weight versus equal weight. look at what people are spending their money on in tech. you can make a big argument that apple sits in that group. you can make an argument back to the autos. we're still wrestling with this whole thing. gm's down 25% since last year. >> they're making probably relative lows of the it's a bad next. ford is at all-time lows. these are cyclical names. there's no growth. you hold them for the dividend. maybe they cut the dividend. yes, you can get them for a trade and maybe make money. no one is winning the game playing ford long-term or general motors. that's dead on arrival. >> how do you think about -- we were just talking about interest rates and let's talk about the 30-year mortgage. when you think about this last leg of the s&p 500 that started the beginning of 2014 after the temper tantrum. we had the 30-year mortgage rate go from 450 to 350.
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how much do you think that was, you know -- how correlated are these stororts of things >> equally correlated. it really gets down to has the market and valuations -- is it all sort of propped up based on easy money policies? are we really -- i don't think the market can handle 350. normalized interest rates, the stock market in principal is not able to handle that. >> carter, thank you. what did you do today or what do you think of carter's analysis >> i love carter's analysis. go back to july 2015, traded up to 37.5 and failed. go to last year, that's where it exploded off of 37.5. what's the point looks like we'll trade down there. risk/reward in the xhb sets up
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decently on the long side against this 37.5 level. >> emt trading tactically again. carter talked about the goalpost. after eight straight days higher there are reasons to trade on the downside. >> what did you do, pete >> i just sold it last week. emd is one of them. we saw huge options come back in there. i like the chip space any way. i think she's one of the best ceos in the business now and amd is in a position now where they could easily run to 14 or $15 a trade. i've been trading the energy stocks like crazy. that's been all of the options the last couple of weeks. >> spy, trading around on the short side. you just said eight days up in a row right now. it did get over that down trend. you really want to watch 2,700 the downside because you could be at 2650 real quickly. coming up, bitcoin jumping
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today as one of the largest block chain conferences kicks off in new york city. we'll bring you the justicy details from the ground and tell you what it could mean for crypto. speaking of which, arthur hayes, the cofounder and ceo of bit mex and a former trader will be here to explain why he went full bitcoin. later, you better hope this home team wins by more than 3.5 points. the supreme court paved the way to sports gambling legalization.
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which you can spend on a funk-tastic music video. ♪ dance party boom. ♪ simple. easy. awesome. come see how you can save $400 or more a year with xfinity mobile. plus, ask how to keep your current phone. visit your local xfinity store today. welcome back to "fast money." root, root, root for the hometown to beat the spread that's because the supreme court struck down a federal ban on sports gambling today and this paves the way for states to legalize betting which could change the world of sports as we know it. >> there are a lot of implications here from technology stocks, media stocks, the sports team. let's look at the casinos. the american gaming association estimates $150 billion are illegally wagered on sports gambling. the profit margins are much thinner. deutsch bank estimates a
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$4 billion revenue opportunity by 2023 just based on 13 states approving sports betting one by one. if you look at the casino stocks today, they've been mixed because it depends on their foot frinlt. if you're just in las vegas, you're actually losing your monopoly but companies that have casinos in many others states they'll benefit for because they have that foot print. mgm is another one. those are all up today. even the mgm ceo had a good sound byte. he thinks they're in the best position to take advantage. >> given our decades of relationships with the leagues, with the teams and of course nevada that we will be a very significant player if not the largest player in this market. speaking of teams and leelgz, dallas maverick's own mark cuban points out the larger connections with his technology and media partners. here's what he had to say. >> if could finally become fun
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to go to a baseball game again. a basketball game, football. it's easy to see how you'll have fun at the arena, at the stadium and while you're watching it whether it's online on traditional tv. it could even help traditional tv because of the zero late fee or minimum late fee. i think this is something that benefits everybody even tangentially associated with sports. >> new jersey's got it now. 12 other states are ready to go. they're working this through their legislature system. pretty soon it could be half the country. >> thanks, eric. >> yep. >> i don't bet but i'll keep that in mind. where you would go, guy? >> whether or not the soft had anything to do with this is part of it. i still think that stocks will trade higher. i thought mark cuban made an
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interesting point. i'm not suggesting this is going to change the fortunes of espn. if people are now more engaged and have to watch because they have a couple dimes on the game it might actually help them on the margin. disney, which to me was all not that interesting, may be you can make an argument that it gets interesting off the back of this. >> i asked berl mus burger that same question and he said absolutely people will watch more games. >> i think there's going to be a lot of media platforms that benefit this. it could be a negative for crypto when you think about the use -- because we've been saying this. it's like legal gambling on your iphone. you have other things that are legal to gamble on on your iphone. so to me, this opens up a whole slue of things. it's a positive for the media guys. >> you fast pitched caesar's. it was really a call on these
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guys coming out of bankruptcy. some of their properties and places like new jersey. bottom, i do think it helps those. the sports franchises have never been more valuable based upon this. they're the ones controlling how a lot of this stuff is played. >> on the gaming side in terms of technology, scientific gaming, that name sky rockets this. they've been acquiring more and more and they're already global. that's an interesting one. you could still look at it trades at a high multiple. that doesn't matter. they got incredible growth. they should not have sold off on this news. their money's coming from -- we know where they make their money. the fact that they sold off is an opportunity. coming up, this stock is hovering near bear market territory but one trader is betting it's about to breakout. you're watching "fast money." in the meantime, here's what else is coming up on "fast." cue the lambeaus.
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talk about the moon, screen graphs because the biggest bitcoin conference is taking over manhattan and we'll tell you what it could mean for crypto. plus, what's the only thing hotter than crypto yeah. cannabis and a mega pot merger today could signal more gains for the group. pot master tim seymour will tell you how to play it when "fast money" returns. the digital divide is splitting this country. we have parents who are trying to get their kids off of too much social media and computers, and then we have parents who would only hope their children have access. middle school is a really key transition point, right. the stakes start changing. students begin to really start thinking about their futures. what i like about verizon's approach is that it's not limited to just giving kids new tools, it's really about empowering educators
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to teach in different ways, and exposing kids to more active forms of learning. giving technology is not a total solution. teaching technology, now that is.
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home depot building a read on the economy, consumers and retail. quarterly results and instant analysis on "squawk box." welcome back to "fast money." consensus the largest bitcoin conference is kicking off today and it wouldn't be a bitcoin conference without some drama. our seema modi is there live to
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break down all the action. >> reporter: they've shown up in droves. over 8,500 people at this year's consensus conference compared to 650 that attended back in 2015 and it's been a wild event. marketers seized on the event showcasing lamborghinis. there was a parody protest organized by bankers against bitcoin. a tongue in cheek way to remind that disrupting force block chain could be for wall street. james bullard spoke and did not bash bitcoin. instead he acknowledge that had digital currencies are here to stay even though is it not think bitcoin is a threat to the u.s. dollar. >> we think it's very interesting and of course there's been a lot of new issuance of cryptocurrencies so we're keeping an eye on that. we want to be very engaged and thoughtful about how this
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proceeds. >> reporter: still, noteworthy investor barry sill verizon sees more money going into cryptocurrencies. >> as finally discovered crypto and i think there's a tidal wave of capital that's about to flow into this asset class. >> reporter: and as if on cue, hsbc making new advancing its first trade finance trans, using block chain which involved a shipment of soy beans from argentina to malaysia. we're seeing more companies put block chain to use. >> thank you. the question is does wall street starting to warmup to crypto we've been at a couple conferences. and actually save money. >> so many things going on. when you think about bankers and the guys i speak to, they're thinking about how they can advise companies to use this
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technology to mediate certain processes going on. to me that's really what's very interesting right now about block chain that last bit they just said. it's a logistic thing. that wasn't a crypto trade of soy beans it was tracking a shipment. >> you could also letters of credit. >> we've been grappling on this desk and people are trying to look at companies and drop in a block chain framework and how it's going to change their business there's obviously industries building around it. but for now, unfortunately, we're not really able to see who's doing what. playing this on the stock by stock is really -- i think there are people out there doing that but the best way to do is look at the people changing the landscape on the inside. >> let's bring in arthur hayes. he was a top trader for
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citigroup, so arthur it's great to get your analysis here on the subject. welcome to the show. so tell us a little bit about bit max. you deal primarily with institutional traders, correct >> with retail traders in north asia. our premises is we want to give access to financial products to retail investors around the world using crypto and that's bitcoin. we offer highly leveraged derivatives, hundred times leveraged. >> 100 times leveraged. >> correct. >> it's the most liquid trading product around the world. does 3.5 yards of day of flow. >> so when we say its by volume because you're dealing with the retail trader and they're presumably not trading the volume -- the dollar amounts that institutions are? >> there's really not that much institutional presence right now in crypto. it is a retailer phenomenon. >> are you equipped to handle institutional trades once that flood gates starts to come in? >> absolutely. we have an api.
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people can code against it. we have prop shop who have joined in because it's volatile. there's negative correlation to a lot of other asset classes and they trade against real humans instead of robots all day. >> the new york stock exchange was going to go into cryptocurrency trading and one of the biggest pieces was the custodial aspect. >> we hold bitcoin, a large amount of bitcoin. we have certain processes that we believe have made us safer than others. at the end of the day, you have to take that risk if you want to trade. >> do you think there's a risk 100 times leverage, that's retail. that's something that's been a real problem especially in risk asset booms. how do you arrive at 100 times pane what's suitable and is that something that is transferrable to the united states you said you're in asia right now. >> it's a headline number. most traders do not use 100 times leverage. the last time i checked it was around 8.5 times leverage.
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they use it as a testing ground. i think it'll go up in the next ten minutes. its limited liability in respect of the trader. on bit max you just lose what you put in. >> you talked about asia and clearly there's a ton of volume and some are arguing that's two-thirds of the market, why that is and what do you see in terms of the retail presence >> asia dominates crypto because they're very used to trading digital assets. south korea has been trading digital goods for almost two decades. when you move to a purely money based digital currency they understand that culturally so they get on board quickly. take that to the west where you have a various establish system and things work pretty well, why do you need to go out and find a new way to trade or new way to
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do things? you have a broker that offers you options, futures, all sorts of different products. you move that into the developing markets where you don't have this type of product and more people are interested in it. >> you've got a stunning bitcoin forecast. where do you see it going? >> 50,000 by the end of the year. >> in january were you wobbly about that prediction? >> no. it's my job to make predictions. whether they're right or wrong, it doesn't matter to me. >> welcome to the show. >> you could be one of us, i guess. >> why is that >> well, i'm a volatility trader. we make our money if it's volatile. if it goes up or down, if you have bill gates calling it a fraud or we're harvesting babies. it means short it, i don't care. if it's going to be a million dollars in a few months, great buy it. we get match trades. >> arthur, hope you'll come back. >> thank you. >> fascinating to learn about your business. arthur hayes of bit mex.
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>> it's interesting -- dan, made the correlation between -- it's a great business, he made the correlation between now gambling being legal going to hurt -- in a lot of ways what you're doing there, he's the middle man of people gambling, basically, which is fascinating. don't underestimate people -- >> as long as a transaction happens you make money. >> here's the irony, one of the reasons crypto traders love it. there's enormous volatility and there's been a lack of price see-through. that's how you make money or at least that's how you can make money. if you think about institutional players getting involved, that should starting to away in a regulatory environment. the efficiency of these markets should be enormous and a lot of people who want block chain don't want it for the volatility. that's one of the big debates that's out there. >> tell you what you loved hearing, arthur's a brother from another right now. the whole idea of this being a derivatives opportunity and
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you're limited risk to buying something that you think is going to go fly on the upside. it's the options world that we work in right now with liquidity. >> this is my very solid belief that it is gambling that doesn't have regulatory framework. we were just talking about, you know, gambling that's existed -- >> people want that. >> i think right now when you're thinking about the volatility, there's a lot of stuff going on. remember stock trading before -- that sort of thing. there's information going on. there's very few people that have all the information in the crypto space right now. it's a rig game. we could never go out to somebody and say you should trade at 100 times leverage even if you're risking what you're willing to lose, what are you basing it on >> it seems to me, arthur didn't sound like he was that convicted to call 50,000. he cares more that there's enormous volatility in a sector where his company's well
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position today do it. that seems to be the story. at least for a couple of the core vehicles that people can play that trade actively, let it rip. >> maybe part of the story is the picks and shovels as opposed to the end product in terms of investing in the space -- right. >> he's not mining for gold. he doesn't even care if it gets to 50,000. >> there's no exchanges in the u.s. that are allowing people to do 100 times leverage. they know our regulators -- >> it would never be also. still ahead, what do at&t, ford, fill lip morris have in company? they're some of the highest yielding stocks in the market. plus, tim's hot for pot, hot sauce that is. he's got one name that's about to light up. much more "fast money" right after this.
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♪ you can be sure ♪ that it will only get better ♪ you and me together ♪ through the days and nights. ♪ i don't worry 'cause ♪ everything's gonna be all right. ♪ ♪ no one, no one, no one ♪ can get in the way of what i'm feeling. ♪ ♪ no one, no one, no one ♪ can get in the way of what i feel for you. ♪ ♪ you, you ♪ get in the way of what i feel for you. ♪
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and i am a senior public safety my namspecialist for pg&e. my job is to help educate our first responders on how to deal with natural gas and electric emergencies. everyday when we go to work we want everyone to work safely and come home safely. i live right here in auburn, i absolutely love this community. once i moved here i didn't want to live anywhere else. i love that people in this community are willing to come
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together to make a difference for other people's lives. together, we're building a better california. welcome back. are you on the hunt for yield? look no further than some big brand names. our bob pisani is live at the new york stock exchange with all the details. >> high dividends are not just confined to utility stocks, the decline in stock prices for
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consumer companies, for retailers and car companies has created compelling opportunities for dividend investors but are the investments safe it depends on which ones you're talking about. at&t traditionally pays a high dividend. but some big names in these groups now pay a dividend north of 5%. that's more than twice the s&p 500 which is about 2% it includes ford, philip morris and macy's. there's other consumers names out there like general mills and even general motors. they all play respectable dividends twice the s&p. so how safe are all these dividends? the dividend pay out ratio. the amount paid to stockholders relative to the amount of total profits. if you had 30 cents paid out in dividends, the pay out ratio is 30 cents. a high payout ratio might sound good but it could be a warning sign that the dividend is unsustainable. so people who buy stocks for dividends do not want the dividends cut because they depend on the income stream.
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let's take a look at the stocks i mentioned. payout ratios of 30% to 50% are very typical for most of the s&p 500. the s&p payout ratio is 35%. stocks that pay out more than 75% of their earnings usually attract attention and it's not always wanted. for example, chevron's got a payout ratio of about 80 prosecution. that's led the discussion about whether the dividend might be cut. the company says it will not and has not. philip morris. that's high. that's the very high end of phillip morris's range. cyclical stocks generally have lower payout ratios since their earnings fluctuate and that's a good rule to live by. back to you. >> thank you. time to take a yield hunting again. >> love it. now the last time we played this game there were some confusions in the control room back in new jersey as well as here on the desk so we want to
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break it down very clearly for everybody at home and the staff. we'll use macy's as an example. macy's has a 5% dividend yield so we'll go around the desk on different stocks. you will hear and see this bull's eye if the trader wants to buy the stock because of the dividend yield. but you will see and hear this, if they do not want to buy here. get it the bird is flying away, not getting caught, not a buyer, the target cha-ching means you're buying the stock -- everybody clear here >> very clear. >> now that everybodyknows wha we're talking about let's start the game. time to go hunting. we're going to use macy's, do you buy them because of the dividends? >> no. i want to preface the no because
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i don't buy any stock for the dividend. >> i am a major hunter of macy's and the bull's eye, the whole thing -- >> are you a major hunter because of the dividend? >> in the worst of times on speculation against macy's was they could not pay this dividend. people misunderstood the balance sheet. they have, i think started to turn the boat. they've got an online presence. i would own the stock without the dividend. >> are they turning things around there when you think about -- forget -- >> how they run that business, they're not going to change. >> their real estate assets are greater than their entire enterprise value. that's been the bull case. >> the bull case also includes that they have a digital presence they've gotten to a place where people are going into those stores and shopping online after being in the store. >> the next stock is at&t. would you buy at&t because of
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its 6 prosecution yie% yield? >> yes, i would. this whole merger, will they/won't they has gotten to be so absurd from the valuation which got absurd on the upside. it's now essentially a broadband play. at&t, you buy. not because of the dividend but boy, that helps. >> i feel like we should see the target in the duck and the duck go down because it was shot -- >> don't confuse -- >> any way. sorry my two cents. >> i throw the duck up there. i'm not putting a bull's eye on at&t of the buying this for any reason is the wrong thing to do. it did hold $31. that was a key level but they have balance sheet issues and valuation issues. i say shoot the duck. >> do not shoot the duck. let the duck go. >> why does the dock not make any sound when he flies away >> dan, would you buy --
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>> i don't disagree about the balance sheet and there's a lot of controversy about their time warner deal. this is a company that's expected to pay $2 in dividends. it's down 28% from the highs of two years ago. if you're willing to hang out with this thing and you think they're going to do something, they're going to buy back a ton of stock >> you buy the stock. >> yes. now you're up, dan ford is -- i tried to get you to move on but you didn't. >> i wouldn't buy this for the dividend but i think they've thrown everything at this stock, the sentiments horrible, the stock we know has been banging around ten bucks here. >> do you let it go or buy it? >> what are you doing? play the game. >> you're hunting. >> would you buy or not? >> i'm buying it. >> then you're a hunter. movingon. guy, you're up next.
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phillipmorris, 5% dividend yield -- >> let the duck fly there, mel. i played the game correctly. because guess what a lot of different reasons not least of which what tim is going to pitch is cutting into all these businesses. when you look at phillipmorris on valuation, they're growing at about 8%. that duck is going to fly for a while there. >> i think this is the last time we play this game. this is still very confusing. >> that's why the duck is flying. >> the duck should be shot out of the sky. >> no ducks were hurt here people. still ahead, it was just one piece of big pot news today. we'll give you all the details. amid all these hot pot stocks, tim says he's got a cannabis play that's about to blaze. will the other traders give his
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pitch a hit or pass on the grass. that's a lot of puns, ladies and gentlemen. much more "fast money" ahead. how about some of the lowest options fees? are you raising your hand? good then it's time for power e*trade the platform, price and service that gives you the edge you need. alright one quick game of rock, paper, scissors. 1, 2, 3, go. e*trade. the original place to invest online. approaching medicare eligibility? you may think you can put off checking out your medicare options until you're sixty-five, but now is a good time to get the ball rolling. keep in mind, medicare only covers about eighty percent of part b medical costs. the rest is up to you. that's where aarp medicare supplement insurance plans
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yet between major canadian marijuana growers. the two companies plan to produce more than 570,000 kgs of cannabis per year. the deal comes two months before the expected legalization of marijuana for recreational use in canada. and the other big pot story today coming from aurora's rival canopy growth. it's applied to have its shares sold on the new york stock exchange. he told me they were considering selling shares on the nasdaq earlier this year but diverted its attention to its deal with constellation brands. they went with the new york stock exchange because it represents wall street and a quote, much more concentrated counter point to what we're doing. he also told me he's seen a quote massive confirmation of the credibility of our company and the sector even in the last few months among investors. the company has been expanding its international footprint with
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business deals in australia, denmark and jamaica. back to you. >> thank you. now, tim, you pitched med relief back in january. >> this deal with aurora, the second and third largest player makes a lot of sense. these guys are all trying to move as quickly as possible. it's a land grab. these guys will have an international footprint that will be rivaling the two biggest in the world. exciting time in the canopy space as well. >> head over to the plasma. part of what i'm doing here is to give you insight into the largest market cap in the space. another canadian player, the story here, this is a company that to me based upon where we look at the rest of the sector even relative to those two companies we just talked about, on valuation, this is a very interesting company. this is a company that trades roughly nine times, ebitda which is about half of what the other
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guys trade at. what you're hearing out of these guys especially when canada goes fully recreational, to be able to have that capacity to build something a lot of people are really scrambling to get. these are the one of the few guys growing capacity in a major way around the world. the international footprint is also something very important. vick newfield who's the ceo ran the largest drug and health wellness products company in canada. that was a global company and that's really what this is, folks. this is about wellness and about the medical side of the business and international growth that these three companies, the two four mentioned and aphria they're using their currencies in the form of their stock price. i think they'll be more of that. this company to me is very well positioned in canada and internationally. >> hey, tim, so why is the wellness trade, why is it traded at half the valuation? >> you have a domination --
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you've got a management team that people have been trying to wait to hear -- you know, what the message is, what the business is. in canopy and aurora, those are two companies with ceos that have been out there talking to their books for a long time. that's part of why the valuation's really -- i think in those two companies really outstrip the other. you've had this massive moves in aphria. people starting to realize that the sector, this is what he's talking about where you're starting to see this kind of all in on the cannabis move. >> no more questions it's time to vote. buying or selling tim's pitch which trades in toronto. pete najarian what do you say? >> i like this valuation so i am a buyer. i like this group and i think there's plenty of upside. >> dan >> i'm also a buyer. i don't know anyone who's doing as much work that tim is right now and it's pretty thoughtful. >> tim hit the bull's-eye there, mel. >> wrong game.
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we're not hunting for fast pitch. does that mean that you're buying aphria? >> the flying duck -- do you like what i did that's a test on your knowledge of the game >> any way, good for you. you're a buyer. >> sure, i am. the traders are smoking what tim is pitching, but are you at home buying tim's pitch for aphria. vote in our poll. we're live at the nasdaq market side in neyo ctiw rkity me square. do not go anywhere. much more "fast" when we come back.
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welcome back to "fast money." check out shares of qualcomm getting a boost. and that has one trader betting on an even bigger rally ahead. >> there's a lot of activity in both the calls and puts. there's one trade that caught my eye when the stock was trading about 56.80. a trader sold 9,000 of the july 50 puts and used the proceeds to buy 9,000 of the july 65/60 call spread. and by selling the puts down at the 50 strike level they're willing to buy the stock down there. we have a couple quick charts. look at the one year chart.
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the thing has had a nice bounce over the last week. if you look at 65, that was a breakdown level a couple months ago and it looked like this deal wasn't going to happen. this is a good trade risk/reward. selling the 50s, buying in the 65. >> i love when you see a trader coming in willing to sell their downside. i'm with you. >> call spread risk reversal there. >> darn right. >> cha-ching. up next, the final trades and the luresults on the twitter poll next. you traded options. i'm not really a wall street guy. what's the hesitation? eh, it just feels too complicated, you know? well sure, at first, but jj can help you with that. jj, will you break it down for this gentleman? hey, ian. you know, at td ameritrade, we can walk you through your options trades step by step until you're comfortable. i could be up for that.
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that's taking options trading from wall st. to main st. hey guys, wanna play some pool? eh, i'm not really a pool guy. what's the hesitation? it's just complicated. step-by-step options trading support from td ameritrade at&t provides edge-to-edge intelligence, covering virtually every part of your business. so this won't happen. because you've made sure this sensor and this machine are integrated. atta, boy. & yes, some people assign genders to machines. & with edge-to-edge intelligence, you'll know your customers love this color,
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[hero] i'll take my chances. the only thing hotter than tim's hot pitch is tony braxton's "unbreak my heart." >> that's what my daughter does to me again. time for the final trade. let's go around. >> i love that call buying in there and let me tell you something. the ceo she's turning the corner. >> stay in this apria trade. tim's turned me on to canopy. we'd is the ticker -- weed is ticker. >> is it required to play this
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song for the entire -- >> yes. ♪ 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 save you some money. my job is not just to entertain but to educate and teach you so call me at 1-800-743-cnbc or tweet me @jimcramer. can this rally be trusted? today's tapes seemed to send mixed messages, starting strong, pausing in the middle of the


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