Transcripts For CNBC Fast Money 20240713

Sources telling Cnbc Softbank is coming to the rescue and will take control of the company. Josh lipton has all the details. Melissa, thats right a new dramatic twist in wework story here cnbc is now reporting that softbank is in advanced talks to take control of wework, thats what sources are telling cnbcs own david faber, a deal could be announced as soon as tomorrow. It is softbank led by japanese billionaire masasan taking control here, after the move softbank would control nearly 80 of wework, prior to the takeover, softbank already invested nearly 11 billion in the company. Softbank economic marcello clarette will be involved in the companys management, former ceo adam newmans stake will fall to low double digits. Last month wework terminated plans to go public the prospectus revealed a huge 900 million loss in the First Six Months of 2019 Corporate Governance practices also causing concern thank you, josh lipton in San Francisco with the latest on wework talk about a down round for the last fund raised 47 billion valuation to what could be as much as 8. 5 billion so high Single Digits wehavent seen this mark down in an equity valuation in a very long time especially from valuation heights like this. We have seen this in other cycles we can go back and remember amazon lost 85 of its value from 2000 highs to 2002 lows and they lost 65 into the 2009 lows its important to remember there are other things going on similar to this. Some of the other unicorns, doordash, post base, the delivery guys, people talk about the bubbles there. There is a public comp. Called grubhub lost 60 of its value in the last year. These are really important situations to keep your eye on it tells you both in public and private markets what investors are willing to pay for growth. You used a good word, cycle im not sure where we are in the cycle for ipos and how investors are looking at the story stocks but we are not where we were if ub her er had to come out and think about the pressure on that ceo and the governance issues there, its a totally different world. The question is, do you look this as a softbank vision problem or a problem for a lot of people at a time when markets are not paying attention to risk right now . I think its broader than just masasan vision fund made a lot of people look good for a long time that didnt have much there its probably the latter. You talk about valuation, it has been the ipo market taken higher, large cap tech or tech that doesnt have any earnings so if thats going to be the case, were not going to see these things rally, where does the market go . But being in eye shot of alltime highs i dont know if we should worry about this as much as we should have worried about it in the past i think there is, one ftd things i said the reason why we talk about wework all the time, not because its particularly interesting because i dont particularly think that it is but what does it mean potentially for the Broader Market softbank some of the greatest investment minds on the planet invested a significant amount of money at a 48 billion valuation. I dont know why that is and maybe the right valuation is the current valuation but the dance point down 80 , that is a significant move its sort of glossed over, because its not the s p 500, but who is to say people arent making the same mistakes in the Broader Market, as they are in wework its not just softbank. Think about the fidelity, for instance, which invested in these early stage ventures when you find out the damper has no closer when it comes to the smartest minds in the room, then youre really questioning a lot of things. Theres another, listen, you could also say who is invested in the vision fund, sovereign wealth funds and big pension funds, organizations that are also invested in the public markets. I dont think in my career in any of our careers that we could remember where private equity is marked down so dramatically so when you think about that if youre pension fund and the time of it being back at the levels of 40 billion plus its years and years, if it ever happens you think about okay what else do i have to think about in my portfolio. This is a developing story well bring you other headlines as they cross. To the other big story of the da i, boeing falling again as troubles mount for the Company Following the grounding of its 737 max planes phil lebeau is in chicago with the details. Melissa, boeing Just Announced within the last couple of minutes it approved its regular Quarterly Dividend, that is 2. 055. Is there an issue with liquidity down the road for the guys hasnt stopped them from approving the same Quarterly Dividend in the past today we did see a number of analyst notes regarding the documents that came out that were leaked out of capitol hill on friday regarding a technical pilot in 2016, his instant messages and emails regarding the 737 max flight simulators. In those analyst notes, guys, we saw three downgrades, and as those downgrades came out, and there were a lot of analysts who said stay to the side the price target came down more than 100 but the consensus is still 412, still well above where the stock is trading right now all of the notes center around this one question, will production drop for the 737 max . When you look at that production, remember, theyre at 42 per month right now the company has told their suppliers they expect to get certification and then ramp up to 52 per month in february, then go to 57 per month by june, then Dennis Muhlenberg with an employee email saying the company is making steady progress on the return to sever for the 737 max. The company is still targeting to have that certification at least by one of the major regulatory agencies around the world by the end of this year. You take a look at shares of boeing, that is an ugly looking chart over the last couple of days keep this in mind, guys, well learn more on wednesday during the analyst call, the first time we hear from Dennis Muhlenberg in terms of a q a situation with analysts and get a better read on where he sees the progress of the company as well as the 737 max. All right, phil, thank you. Phil lebeau in chicago with the latest on boeing tim youre a shareholder what do you make of the past two days here is the issue the Free Cash Flow hit is something people should be concerned about. What we talked about the company if for the last 18 months that lead it to its peak was all about three cash flow. At its peak in terms of forwardlooking basis, almost 24 bucks a share in Free Cash Flow. Ubs downgraded 29 cash flow by 3. 5 billion, downgraded 2020 by 5 billion. If you listen to the analysts maybe they got more relaxed were flexible when the max production would restart, most guys were october november if you read these guys in the beginning of the summer theyve been sneaking it in to like january, but now they have to address this and theres no question i think the faa has to slow it down if to no other reason until they find out more about this that puts back some of the free cash numbers more. I said on friday, how is this stock positive year to date . We talked about this, if it was any other stock it should have been cut in half i feel people are saying theyll always be around we saw back in march the decline of 18 , start in july decline of 16 this was 14 rapidly but still positive year to date. Its mind boggling to me is that a good sign or a bad sign a good sign because its telling you theres a duopoly in this segment no matter where we go, you got to be someplace, one of the two. Sfwli i was talking to Carter Copeland on power lynch a 500 price target on boeing stock still. With all this stuff happening, muhlenberg going to the hill, et cetera, he said at the end of the day its a duopoly people have nowhere else to go life is good if youre in a duopolyp certainly is. Thats the reason he kept with the 500 price target. Facebook, for everybody that wants one of the things id love to hate but you cant because it lives by itself sort of in this world. Boeing to a certain extent as well i understand what steve is saying but its down from 446 in january. Yeah, january february, thats a significant move to the downside and maybe bolstered by the fact the s p 500, alltime high how do you trade the stock here . I think weve been pretty consistent the december lows are in place, and that low i think on the 19th was right around 305, and weve said this, why in this environment especially given those headlines on friday about these instant messages, why pile in ahead of earnings i dont see your edge at this point. Listen, thats just a point in time, december 305. Who knows . What i see from an earnings standpoint is analysts took out what they were expecting 10 Earnings Growth for 2019 and basically slashed it down 80 and moved it to 2020 and 2021. When you talk about this duopoly they dont have to buy the 737 max. To me this is going to get messy for a while. I expect the ceo will not be the ceo by the end of this year and a long period of time regulatory issues, finds, mes, mismanageme, the company will be cautious on guidance id said that consistently since the sad incident its important to remember 346 people died in two crashes and thats what it took to ground two planes on the 12 30 Conference Call you said today guy, are there any incidents in history comparable to what was going on in boeing. That was a good question really . For once you had a good point. Exxon valdez i thought of wells fargo they screwed the entire thing up for two years and the stock has underperformed its sector over that same time period but this cultural issues, what people thought were cultural issues and so they had a regulator breathing down their neck, the fed putting growth caps on them, which is effectively what the faa can do in terms of the resecertification process. Is that a bad comparison i flattened out a few weeks ago. I was ready to jump back into the position last week my view was this is a company that around 350 i wanted to own and whats different about this and so all those scenarios you just discussed, you basically have the issue with a regulator. This is even more acute with a regulator. Obviously exxon and bp had to deal with a lot of different functions and it was really more about liability in terms of measuring the damage, and even though they did some horrible things to the earth, i think people were trying to put a dollar number. Its very difficult to put a dollar number on this. The sense is that boeing and the faa always had a very respectful relationship and if you feel like thats been tarnished in a way its never been before, this will be a bigger problem for the company than weve ever seen coming up, drug makers rally on an opioid case settlement, what that means for the drug space. Tony dwyer says the markets new alltime high is under way hell reveal whats going there. Much more fast money right after this with Portfolio Managers focused on the long term. Who look beyond the spreadsheets to understand companies, from breakroom to boardroom. Who know the only way to get a 360 view is to go around the world to get it. Can i rely on deep research to help make quality Investment Decisions . With capital group, i can. Talk to your advisor or consultant for investment risks and information. Talk to your advisor or consultant tell him were flexible. Dont worry. My dutch is ok. Just ok . Tell him we need this merger. Its happening. just ok is not ok. Especially when it comes to your network. At t is americas best Wireless Network according to americas biggest test. Now with 5g evolution. The first step to 5g. More for your thing. Thats our thing. That could allow hackers devices into your home. Ys and like all doors, theyre safer when locked. Thats why you need xfinity xfi. With the xfi gateway, devices connected to your homes wifi are protected. Which helps keep people outside from accessing your passwords, credit cards and cameras. And people inside from accidentally visiting sites that arent secure. And if someone trys well let you know. Xfi advanced security. If its connected, its protected. Call, click, or visit a store today. Welcome back four Drug Companies reaching a major settlement over the opioid crieses. Meg is in cleveland with the latest reporter that settlement news this morning has been quickly eclipsed by bigger potential settlement news. When we got here it was to cover the First Federal trial over the Opioid Crisis settled minutes before it began with the four Drug Companies involved. Then this afternoon news came out a potential broader settlement involving those companies and Johnson Johnson might have potentially been reached. Four state attorneys general are leading the negotiations on a potential broader settlement held a Conference Call this afternoon, and said that they reached a framework with the companies, it includes 18 billion in cash paid by the three drug distributors, mckeson, ameri source and 4 billion in cash from Johnson Johnson and 23 billion worth of medication assisted treatment drugs from teva as well as some cash about 250 million potentially over ten years there is a wrinkle, though the plaintiff cities and counties involved in thousands of these cases are not necessarily on board with this framework. We heard that from the attorneys representing them this afternoon, and not all state attorneys general are on board either the Ohio Attorney general dave yost saying in a statement this isnt a framework. Its a pile of lumber dropped on the construction site. Ohio will wait and see what the detailed plan looks like. This is still very much in flux right now, guys and of course these five companies are not the only defendants involved in the thousands of cases more than a dozen have been named in the cases and could potentially be involved in a broader settlement at some point and guys, we talked with the plaintiffs colead attorney joe rice after the proceedings this morning. He told us there could be more potential defendants named here, beyond the dozen we know about, more companies could be brought into the fray so it is far from over meg, in terms of the state ags, how many state ags would have to approve this deal in order for it to be a global settlement thats not clear, among the many questions that were asked of those four state attorneys general, and how many of the cities and counties might need to be on board as well right now there is certainly no agreement that weve heard about. So effectively if everybody came on board wed be looking at a total sum for all of these companies in the 20s, billions of dollars for states, counties, municipalities, and for everybody, basically, and thats it reporter thats right, but thats only five of these companies, so you have other potential Companies Including pharmacies, other Drug Companies that could potentially be brought in as well for these five, yes, youre looking at about 22 billion in cash, and then about 23 billion more in drugs. Okay, meg, thank you. Meg tirrell joins us from cleveland, ohio, where the federal trial was scheduled to start this morning it seems like a pal tree some at the end of the day for the Drug Companies which is good for shareholders i get the sense the settlements are not the end. I realize a settlement is a settlement, but i think the numbers being thrown around here, if j j who doesnt like to settle ever, and usually is the guy an entity that is standing in there and fighting til the end, except for the fact as you hear about hey well trade 4 billion in exchange for 50 billion in opioid cases up against, we also think the pr around settlement may be very good for us, this is the kind of thing that you start to do the calculus on, except for the fact that we have only heard from five states and i think this is a case where well see much bigger numbers its a very emotional public issue. Teva down 47 yeartodate, off of the news it popped 15 today. Its coming from a low base. Im not saying the sky is clear but if youre going to play this for some sort of a news event, maybe you play it through options or maybe you buy the equity but it is a very expensive option, but its priced as if its going out of business well the equity is distressed this is an 8 billion market cap, got 30 billion in debt, only 2 billion in cash and if you look at the earnings and their sales, theyve been declining every year for the last few years so this is a difficult situation. I think Johnson Johnson to absorb this sort of thing is better you make a good point. For these guys saying here is our framework and johnson oo ss johnson never settles. J j is fighting a battle on two fronts, not even talking about how about three a list of drugs its not just how about the political pressure on the sector, too. Its not as if i like j j i cant say i go in and buy more of it here but i do think its something that is held up actually remarkably well relative to all this pressure. J j, probably said 121 is the level it trades down there getting back to abc, cardinal health, mckesson issued a statement, hoping obviously this settlement in ohio leads to a framework but to tims point, hope is not an investment thesis that stock mckesson has gone from 130 to 152 pretty much in a straight line. Evaluation makes sense they report i believe at the end of the month you have yourself where is the next level to get in mckesson might be one of the most interesting ones here, 141 makes sense for a lot of reasons, 2. 5, 3 from where we are. Read more about the settlement on our website cnbc. Com we have much more ahead on fast money. Heres whats coming up next break out your rally caps, because one of wall streets biggest bulls says were headed back to alltime highs hell lay out three factors that will get us there. And later, pedaling pass activity wall street analysts going bullish on peloton, but the stock has a big uphill ride. ll explain, when fast money returns. Your family is duckin and rollin. While we stowin and goin but thats cool, i know for a fact your suv does not suck. And why is that . It aint got that vacuum in the back, whoo sucking stuff up what else are we gonna find . We got to go. Vacuum in the back, hallelujah get 0 financing for 60 months plus 2,250 total bonus cash on the 2019 chrysler pacifica. But in my mind im still 25. Thats why i take osteo biflex, to keep me moving the way i was made to. It nourishes and strengthens my joints for the long term. Osteo biflex now in triple strength plus magnesium. Thats what happens in golf nothiand in life. Ily. Im very fortunate i can lean on people, and that for me is what teamwork is all about. You cant do everything yourself. You need someone to guide you and help you make those tough decisions, thats Morgan Stanley. Theyre industry leaders, but the most important thing is they want to do it the right way. Im really excited to be part of the Morgan Stanley team. Im justin rose. We are Morgan Stanley. Welcome back to fast money. The market marching closer to alltime highs as the busiest part of earnings season gets under way. Our next guest suggests new records could be around the corner tony dwyer good to see you. Thanks for having me, mel what brings us higher the guys and gals printing the money told you theyre going to print more money. Ultimately the term dont fight the fed comes from the fact we always come up with the great reasons of why its right or wrong, good or bad the guys printing the money told you theyd keep printing the money and that means an offensive playbook how do you know the pivot point, mel . For me its when the tenyear note yields makes a low, defense to offense, happens september 3rd, got retested a couple weeks ago and moving higher, trannies, small caps, offense is playing for a while when rates looked like they were low, whatever, a lot of bullish strategists say thats good for valuations here you are saying once thetive odd happens in the tenyear yield and it goes higher thats a good thing for stocks. Is there sort of i dont know a golden area in which you dont want it to be too high, not too low . Its more direction than trying to pick a level. I dont think levels are as important as they used to, except when they hit extremes. Is 1. 5 the level . You broke it three times by a little bit, so you could look back and say maybe its anything below 1. 5 but again, the pivot psychology that happens, everybody got on to the defensive side of the boat its the psychology not necessarily the actual its a a human nature game we try to put numbers on our whole bull story for 2019 as you know was wrapped around weaker Economic Growth that got the fed engaged enough to make the long and realize theyll restimulate growth what are you seeing in the market pmis globally, an Inflection Point off historically weak levels a lot of economic data, three things the fed easing, the Central Banks globally are flowing money at the whole thing and forget about whether its good or bad. It is what it is the second thing is you get an Inflection Point in the Global Manufacturing and youve got a demographic a monster demographic tailwind with the millenials peak birth year turning 30 i went to a nieces wedding, she got married two weeks ago and she had nine gals in her Wedding Party and theyre all going at each others weddings and starting families and doing what you do like i did when i turned 30, start a family, start spending money buy a house you buy a house, ten years of Income Verification at 30 years old. They just cut rates in half, and theyre still giving us money. Youre in a recession in the consumer, when they cut rates and theyre not going to give you money, it doesnt matter i thought they didnt buy houses and care about material stuff. I was a millenial 54yearold millenial. All i wanted was experience when i was in new york city using the r recoword recesn you nailed 18 months to 24 months, once the yield curve inverts as your time line to still be buying the market correct where are you on recession . The fed you talk about the party is all in the feds pocket, they have limited bullets, right . They cant do as much as youre hoping for them to do in the markets. The interest yield just got in half. Everybody i know that can is refiing everybody that wants to buy a house got a cheaper mortgage youre actually having a simulative turn coming from all of this weakness and again, you know, people are so sick of me talking about the third mini recession of the cycle were in a manufacturing recession. People are looking for what we already found. Were in a mini recession. Now were coming out of it, because rates dropped so much. You only know that because the tenyear has turned and thats the sign youre stimulating growth lets talk s p 500 for a second sure. I think about q1 earnings cycle into april, the stock market made a new july time high and came in 7 from the start, and we go into q2 earnings cycle in late july, same thing, new high in the s p 500, 6. 5 decline. Well make a new high, you told us that, just a percent or so away from that but were going to be in that last week of the q3 earnings cycle. Why is it different this time . Again, because the expectations are now finally, dan, beginning to come down. So here is a mythbuster we did at canaccord we looked at out year estimates. The out year estimates the argument is still have to come down we found in years this cycle and before when the out year estimate was reduced aggressively, guess what valuations expanded and market went up. The two of the three negative years this cycle happened when the out year estimates were actually revised upward, 2011 and 2018 this is all about the money printing again, this never ends well. You cannot fix debt with exponentially more debt. Its not going to go good. The dwyer Doomsday Clock happened, the 210 curve inverted now you watch the credit metrics to figure out when its imminent Corporate Credit is booming. Household Debt Service Ratio historically low, delinquency rates at cycle low the yearend price good for next year is 3350, this year only 295, right now were above that in terms of what sectors bring us to 3350 youre going offensive. You got to go offensive forget my opinion. Go with the history of what happens when you bottom the tenyear, financials, industrials, Consumer Discretionary and cyclical tech lead, in both cases, so in both cases coming out of the i had know recessions in 2012 and 2016 youre up roughly 20 . When you made that low in the treasury yield so the low in the market happened, market rallied 20 , treasury yields made its low, went up an additional 30 plus led by offense. So im not going to chase the target higher. Its silly in two months to try to put a valuation on it but im focused on 33. 50 and i think its frontend loaded and if thats right, im very conservative for next year all right, tony, good to see you, thank you, tony dwyer canafford ingenuity. There are two names that could be coming along for the ride, whose run may be done. Carter breaks down the plays two good ones, two bad ones have earnings this week. Lets look at it together. What is conventional buy a big word in the sense that convention general lay greed upon, everyone knows that a stock at well defined tops has the potential to break out could be nike, could be jpmor n jpmorgan here are two, verizon and vf corp. , nothing to do with one another but its not what they do, its the setup the weakened of the market, heretofore strong stocks, paypal has nothing to do with roper but theyre virtually identical. Well start with those two a comparative chart, a oneyear chart, literally a perfect overlay. This is 120 billion payment processor, this is a 35 billion global industrial, and it is a virtual perfect overlay. They are both bullish to bearish reversals. You can call it head and shoulders top. You can say paypal broke its trend line, but either way, thats not typically a good setup. Now hold that in your minds eye and look at the next one its identical im not drawing the lines. The lines draw themselves. Its the same setup. They have nothing to do with one another. Thats the point of charting in many ways, trying to suspend ones knowledge or purported knowledge and just go with the facts. Vf corp. , big apparel name, 37 billion brands that you know, like vans and timberland, north face are these well defined tops at a common level as it works in the apex, is it just now breaking out after two years in a range, it is. Does this have anythingtodo with one of the biggest telecommunications in the world, verizon, its identical. Thats the point, why more and more money goes to algorithms to passive investing because it doesnt really matter sometimes what the darned thing does these two look as though theyll continue to break out, the other two look as though theyll continue to roll over. Carter, thanks. Carter braxton worth where can we see more of carter, mel . On fast money or options action. Love him. Genius coming up an analyst put a price target on apple. Well break down what could be behind the next big apple rally and the big week ahead for Mark Zuckerberg, as he gears up for another appearance on the hill much more fast money right after this this is the age of expression. But shouldnt somebody be listening . So. Lets talk. Were built for hearing whats important to you, one to one. Edward jones. Its time for investing to feel individual. Filmgate is growing really staffing a small bquickly and. Is challenging. I needed to fill a production coordinator role. I was looking for someone with specific skills. So i posted a job on linkedin. Maribel had all the skills i was looking for. And looking at her profile. I saw shared connections. That was a plus. But the most important thing. Is the ability to connect to people and she had it. And i knew. She was the one. Post a job today at linkedin. Com grow welcome back to fast money. Raymond james getting sweet on apple, raising its price to 2. 80 from 2. 50 Raymond James says strong iphone sales will boost apple earnings. Does the stock have another 20 upside i feel like everybodys finally moved to the other side of the boat thats been part of the move here, right . I dont think going into this refresh there was any expectation, so when you actually heard about slightly lower prices, you got a sense shipments could be a little bit better, people have woven in their 5g into next year, but i think the only way you can do this, im long apple and pretty bullish here is by the multiple. Thats how analysts play with numbers and make it go higher if you believe that the blended multiple takes you to somewhere 18, 19 times where at 12 times historically starting to say apple is expensive. With the Capital Markets activity they can throw at you and the dividend and the ability to continue to execute on buybacks i think they get there. Part of this call was the lower price launched at the beginning of next year a bridge to the 5g cycle which could last two years instead of one year according to Raymond James i think everyone threw out hardware, everyone thought it would be a services game when you enter back in and say hardware is going to be something, its going to move the needle tailwind. Now its a tailwind you have to remember technicals. 233 was resistance that becomes support, breaks down below that, exit the trade, and it is overbought on an rsi right now, relative strength index. Wait to get back in or buy more if youre still long apple 280 left becomes the math problem, giving a 22 forward multiple off next years 12. 75 or so apple expected to earn, so you could understand where the number is coming from if thats the right multiple who is to say . The 232 level that was a previous high and blew through they have something to trade against. They report on the 30th. Market seems to be okay, maybe it levitates into the earnings if youre buying the stock at alltime highs, after trading 70 . Because of the 5g cycle, let me tell you, people, people are not in this country going to be upgrading their iphones that they just spent 1,000 or 1200 for a 5g phone theyre already on the market in other places. The networks dont really are not ready for it the whole bullish thing, dan, people lower their estimates so far on hardware. Largest trilliondollar stock in the world we avoided that as a newsday it was actually pleasant last year at this time it had a trilliondollar Market Company and by january 2nd it had below a 700 million market cap. Thats my point we shot well through the trillion dollar level. Thinking fresh 2020 cycles, have at is it. Im not we can do this all over again but probably time for a commercial theyd have a ball. Knock yourself out. Thats in third place from one tech giant to another its a big week for mark zuck zuckerberg, he is headed to capitol hill to testify before congress Julia Boorstin has what we can expect Mark Zuckerberg is looking to get his message out there ahead of his testimony on wednesday before the House Financial Services committee he spoke to Nbcs Lester Holt in an exclusive interview i get a lot of people are angry at us. Part of growing up for me has just been realizing that it is more important to be understood than it is to be liked, and i believe it very strongly, and i do think that people can make up their own minds about me or the work that were doing, but this is who i am. Coming up on wednesday, hell be questioned about facebooks push to create cryptocurrency libra, highprofile backers recently dropped out of libra, the treasury warning it could be a tool for money launderers and terrorists and there are privacy and antitrust concerns about the cryptocurrency ahead of the testimony wednesday facebook unveiling its latest in its work to protect elections including labeling posts they deem false on facebook and instagram as misinformation. Mayor Pete Buttigiegs campaign confirmed zuckerberg and his wife Priscilla Chan recommended staffers to the Buttigieg Campaign zuckerbergs spokesperson saying that they havent decided who to back yet in this president ial election melissa . In los angeles, apparently pete buttigi Pete Buttigieg they were at harvard at the same time no kidding. Were you there with him . No. You predated them it was petes idea for facebook it wasnt thewinklevosses. Now hes making things up what to expect here . This is a stock you were penning opeds last year yes, bleeding edge. This could be a front from the perspective of getting in front of Regulatory Service things, earnings are expected to rise 1 this year so theyre gone, okay, but this is one of the most toxic stories we talked about boeing we talked about johns son amson johns johnson. I have teenage girls, more concerned with what goes on their platform than i am with drugs and alcohol, and cigarettes and stuff like that its a toxic product, this is going to be something that our generation is going to face right now and how we deal with it and so to me, i was reasonably constructive last year dealing with all this stuff. I think this is going to get worse. I think 2020 will abe disaster for them hes not the right guy to steward them i think this is a huge story its not zuckerbergs role at least i dont think its his role to decide on what is going on you could take malicious, you could take hate and all that off but its not his job to Police Facebook i think it is its too difficult to do. I think it is what were learning and 2. 0 or 3. 0 of social media, it is their responsibility and were getting to a place where not only is the trust and the privacy and theres multiple layers of that but from a regulatory perspective we can believe in free sxeepeech and expression ad not having stuff on our sites. I think some is figuring it out and the more important part i dont think they know how to value their company or the cost of doing that, the cost literally and the cost of their viewers. My point is different from all that, its equally as important. Advertisers leave platformsor leave products all the time. This is going to be the issue of our generation from an addiction standpoint let me tell you something, they left the cigarettes and left the vaping and they left this other stuff. Its going to happen to these guys im telling you that have at it, dan but into october 30th the stock stalled for the last few months, hasnt made a new high in a long time. Weve been saying this, until users and advertisers leave, but they may havent done that yet. Its a decent stock to trade you would agree. The moves have been interesting. Technically its done everything right. I said for a while i want in my heart to hate everything about it, but in terms of the stock, in earnings on the 30th, it pains me to say to your point, people arent getting rid of their facebook pages, and advertisers arent leaving, because they have no place to go, so i think it sets up well in earnings next week or whenever october 30th is up next its mystery track time, options traders are betting on a bigger bounce when it reports results plus analysts initiating coverage on peloton, following one curious pattern that ergmeed with recent ipos most people think of verizon as a reliable phone company. woman but to businesses, were a reliable partner. We Keep Companies ready for whats next. man we weave security into their business. Virtualize their operations. woman and build ai customer experiences. We also keep them ready for the next big opportunity. Like 5g. Almost all the fortune 500 partner with us. woman when it comes to digital transformation. Verizon keeps business ready. Doprevagen is the number oneild mempharmacistrecommendeding . Memory support brand. You can find it in the vitamin aisle in stores everywhere. Prevagen. Healthier brain. Better life. Welcome back to fast money. We have a slew of earnings on deck one big name gearing up to report tomorrow is Procter Gamble the heavyweight is on pace for its best year since 1997 a big run cooled off this week managing director of Xp Investments breaks down the options action welcome back, bono take it abe. Thanks, melissa taking a look at the weekly options, you can see the at the money is implying a 4 move in line with what weve seen over the last two years so options are pretty fairly priced lets talk a deeper dive now this sticks out to me. If you look at call and put volume for the month you can see that calls outstrip puts 2 1 2 to 3 times to one, thats significant. Seems like theres bullish sentiment coming in to earnings here which is interesting, because taking a look at this next chart, you can see that there is a longterm uptrend here i want to focus on this place right here, were kind of testing the lower bound of that up trend it will be interesting to see whether we hold trend and bounce or if the stock rolls over and sells off. Two things that come to mind, a couple ways to play this if you compare Procter Gamble to the xlp, the consumer staple etf of which p g is 16 , you can see focusing again right here, this spread, sorry my drawing skills arent working today, this spread here is at pretty significant statistical highs. Xlp looks cheap versus pg. Taking that a step further, skew for pg, Procter Gambles skew is cheap why is this actionable theres a couple ways i like to play it. Selling put spreads or selling 1x2 put spreads. In other case you sell at the money or there about put and buy one in the case of buy one or two downside puts. Both situation also protect you if that stock does roll over, and the 1x2 you realize profitability if that stock continues to sell off. Now to add another player to this, i also like overlaying either one of those strategies with the sell of an upside call and i typically do not like recommending the sale of calls but im comfortable here and ill tell you why. The options are implying a 4 move if you sell that 6 or 7 out of the money call with the proceeds you take in from that package, if the event they make an aggressive move to the upside, you will get called out of that stock at alltime highs. Now, keep in mind that pg is trading at 27 times price to earnings compare that to xlp, 21 times, walmart, coke, pepsi, 24, 25 times. So again, in the event, and thats if you do get called out of that stock, you can take those proceeds and rotate into other defensive secure Counter Cyclical names that still give thaw safety in your portfolio. Thats how im looking to play pg thank you tune in the full show this friday 5 30 p. M. Eastern time. Up next the one wall street analyst that might have signed, sealed and delivered a bottom for fedex. Well explain. Look at the kramer cam, jim talking with the ceo of stock x. That coming up at the top of the hour on mad money. Much more fast money still eaahd. Man can i find an Investment Firm that has a truly longterm view . It begins by being privately owned. With more than 85 years of experience over multiple market cycles. With Portfolio Managers who are encouraged to do whats right over whats popular. Focused on helping me achieve my investors unique goals. Can i find an Investment Firm that gets long term the way i do . With capital group, i can. Talk to your advisor or consultant for investment risks and information. Talk to your advisor or consultant hey. Hey. You must be stevens phone. Now you can take control of your home wifi and get a notification the instant someone new joins your network. Only with xfinity xfi. Download the xfi app today. Welcome back to fast money. If your he a loyal fast money fan, we covered the downgrade of fedex, saying the bowl thesis has been shredded. Take a listen. Shredded, dead money, not working, spending unchecked, downgrading, just a few of the scathing words bernstein had for fedex and you expect that to tank the stock but youd be wrong. Fedex hung in there under a barrage of pessimism and its hung in since climbing nearly 10 since that call so what does this mean for the stock . Was that the bottom . Guy . They rang the bell and we alluded to it that day after you went on your rant, diatribe which was fantastic but doesnt mean theyre wrong their timing was miserable this is a great bounce youve seen bounces like this before in fedex. At a certain point you fade it i dont think its right here but there will be an opportunity around the 160 level to sell this sucker when it. Seasonablity i said this a couple weeks ago, november is the best month for fedex, december is the worst month. So you do have some, just specifically for that 30day range, you cant find in the last fiveyear average any year that was negative for november for fedex. I think youre okay staying long analysts initiating coverage on peloton buy or outperform rating, its a pattern playing out with a number of other recent ipos. Look at uber, smile direct club, beyond meat, zoom went public this year. Their lead underwriters are often firms initiating with bullish coverage on the stock and the same bullish calls diverge from the stocks performance since they went public, uber smile direct or peloton have plunged and beyond meat and zoom fallen off their highs. Are underwriters too bullish what does that mean for investors looking into the names in i feel we should play the more you know kind of thing. This is sort of what you suspect goes on, on wall street anyway let me add one point. Tim probably wants to have at it a little bit we use the term underwriters and the pricing on the deal is entirely wrong they are one player in this. Early vc investors, growth investors, mutual funds that get in while theyre private a lot of people have a vested interest in pricing very high including the company. So when you think about that, the only people that dont have it are those that are buying on the deal for the first time on the day of the ipo to me those investors are often giving unrealistic indications of what they want, too, so its easier said than done finding that right price and i dont think its all about the underwriters the bankers and the research guys are supposed to be sitting in different rooms having different views on things. Im going to take the view thats whats going on here but we have seen with a number of ipos is more in line with what dan is saying. I think by the time these companies have come to market, everyone who wanted to own those shares owned them and there was nothing left to do and it was all about lockups coming out for companies that the private world has never been that big. That is what this has been u about. Up next, final trades or th. No commission. No matter what you trade, at fidelity youll pay no commission for online u. S. Equity trades. At fidelity youll pay no commission whether your beauty routine is 3or 57,. Make natures bounty hair skin and nails step one. Its the number one brand uniquely formulated for silky hair, glowing skin and healthy nails. Natures bounty, because youre better off healthy. [spokesman] if youve tried colleg group cheering shed, snhu lets you transfer up to 90 credits toward you bachelors degree. [woman] it doesnt matter how old you are, you can do it, you can finish. [spokesman] finish your degree at snhu. Edu its how we bring hope to our patients like viola. Her team treated her cancer and strengthened her spirit. So viola could focus on their future. Cancer Treatment Centers of america. Appointments available now. Tonight a learn more on the focus from footwear. Im going to give you my take. Mad money is next. Final trade is sponsored by Interactive Brokers minimize your cost to maximize your return. Welcome back to fast. A big interview tomorrow disney ceo bob iger will join Julia Boorstin from the vanity fair summit tomorrow just past 1 00 p. M. Eastern time. Tim . The banks have outperformed the violent rotation we saw in August September is happening again quietly. Steve this is a tough one, snap ill say buy but their report tomorrow, a slew of analysts getting positive on the name upside to 18 but this one could get hairy. I think youre okay to buy it. Dan unlike guy, i think you do not buy facebook into the earnings, it is an epic looking head and shoulders top rated i love feisty, dan. Dan is always feisty. Its schlumberger, nice litt. See you back here tomorrow. Mad money starts right now. My mission is simple to make you money. Im here to level the Playing Field for all investors. Theres always a bull market somewhere, and i promise to help you find it. Mad money starts now hey, im cramer. Welcome to cramer america, im trying to make you some money. My job is not just to entertain, but educate, put it in context, call me, 1800743cnbc, or tweet me at jim cramer no other stock in this marke