Transcripts For CNBC Fast Money 20240714

The latest phil melissa, not surprisingly boeing will take a big hit when it comes to the q2 earnings that it reports next week lets run down the numbers the Company Announced within the last half hour it is taking a 4. 9 billion after tax charge that works out to 8. 74 a share. Thats for the Second Quarter. Essentially it comes down to the 737 max, they say it is due to concessions and considerations theyre going to be needing to make to customers, not only those they made in the Second Quarter but extending over the next couple of years revenue and pretax earnings are going to drop by 5. 6 billion in the Second Quarter or theyre going to be reduced by that much in the Second Quarter. Production costs in the Second Quarter, up an estimated 1. 7 billion, but we should point out that is accounted for over the life of the program so it is going to be extended out over many years since they have more than 4,000 737 maxes on order the assumption from boeing at this point is that the airplane returns to service in the Fourth Quarter. Now, we should point out that is a very general, vague assumption they are not saying for sure that it will happen. Theyre not putting a date out there. Theyre simply saying their assumption is it returns to service in the Fourth Quarter. In terms of production, which is what so many have focussed on it, it remains at 42 per month and the company is saying as part of this new guidance that theyve issued they still believe they can get to 57 per month at some point in 2020. In terms of guidance, melissa, remember, they pulled it after the first quarter. They said were not really sure what is going on with the max at this point, therefore were not giving guidance. Today they said they will give guidance for 2019 at some point in the future. When remains unknown melissa. At a future date is the exact wording. Phil, i mean, what were analysts expecting in terms of this charge how should we extrapolate or should we extrapolate this charge in the Second Quarter to future quarters if the 737 max remains grounded for longer, for beyond the Fourth Quarter . Well, i think most of the assumptions were roughly in this neighborhood i have not seen a definitive, hey, we are expecting this charge thats the consensus on the street i know most analysts i talked with are around this area, this 4. 9 billion after tax in terms of whether or not you can extrapolate this and say, look, they didnt deliver in the Second Quarter on the 737 max, they didnt deliver in the Third Quarter or may not dwlifr elive the Third Quarter therefore we should see the same charge, i wouldnt do that, melissa. Remember, there are certain costs in here they will be accounting for over the life of the program, and in terms of that concessions of the 4. 9 billion, thats for concessions and other considerations to customers, they make it very clear in the announcement it is not just nor the Second Quarter, while it is where the charge is being taken, it is over many years. So we may see a charge for the Third Quarter related to the max, but it may not be at the same degree we are seeing here phil, it is karen let me ask you something do you have any idea about the Purchase Price of a 737 max, what it was a year ago or six months ago even, before any of this happened, and what it is now . Right. Because this is their, you know, future for years yes, well, the book price hasnt changed, karen. They still list it and i dont know the exact amount but i do know it hasnt changed. But keep in mind, when they sell these planes they never sell them at the price thats listed there. You usually is at a great discount to the price that they listed at. So as a result, it is hard to sit there and say, well, look, theyre knocking off this amount on each of these planes. I think it depends on the customer, it depends on the size of the order, and it also depends on to a certain extent the kpus mcustomer saying, look are paying the price in some fashion, whether it is leasing other aircraft, change your our schedule, reducing the amount of flights we have, all is factored into how much the end price will be. Phil, thanks for the details. Phil lebeau with the latest on boeing shares up nearly 2 in the after hours session. We should note that the stock was down more than 2 today. Guy, what do you make of this . Obviously you just said, it got back what it lost during the day. At least you have a degree of certainty now in terms of a number i mean theyve basically came out and told you what they expect it to be, what theyre taking in terms of a charge. I still say this this stock when it troughed back in march it traded down to 365, slightly lower and higher side ways but here we are at the same price. I will say this. Valuation makes sense. I think you are underestimating the defense component of this company which is not as big as commercial airlines, i get it, but still forget it. I think you can own it in earnings i understand why you want to avoid it, but i still think it is a but it trumps any type of defense but here it is in play. But you still have to train people on how to use the plane still, even when it comes back there could be a yearlong Training Program on this so if you have it, maybe you hold on to it. I would not step in and be a buyer right now. Let me ask you this when the 737 max goes back into service, lets say it goes back into service december 5th, dan, you will take your family on holiday and christmas, are you going on a 737 max or wait i was on a flight yesterday and the Flight Attendant went out to say, you are on a 737 blah, blah, blah, not a max. This is definitely top of mind guy is saying he thinks the valuation makes sense. If you think they get above 20 in earnings next year, then the valuationmakes sense here if you are willing to kind of take a little time with this thing because it is going to really you know, it is going to take months to figure it out. I will make one point. The stock is still up 12 , it is trading to the year, trading at the same level where it was when the lion air crash happened in october, and there was another crash. 350 people have died if this was any other sort of company, i dont know why this stock is still trading with a three handle remember, last year when apple oh, my goodness iphone sales were slowing and china was week, that stock sold off 35 peak to trough. And nobody died. Yes. Leapt me ask something, dan dont you think that the stock weve seen a drum beat of news, obviously the two crashes horrific news and the delays and uncertainty about how to train the pilots. All of that though, and then the air show where they sold the first today nothing, and it seems to me like the drum beat of bad news is actually played out. Here is a gigantic charge, nobody cares it seems to me like that has already played out. If theres nothing else what happens if theres one other incident there will be a learning curve each time it trades down, thats on bad news. Right. But once you get that the pilots cant be trained and it is a little more difficult at first they said it was a software fix, then the pilots have to be retrained the story keeps getting longer granted, your point i agree with. But the stock has sort of bottomed even with whatever bad news has come out in the last months. It is trading decently the fact it is up over 11 yeartodate. Yes. Is phenomenal with everything going on. Everyone wants to give it a chance though . I have owned this stock on and off over the years, and the people that own the stock believe in it forever. I sold it up 150 points. I thought it was a hero. I cant go back into it right now. I mean this is this is just crazy. Even though the valuation is not nuts, it just feels like im gambling with 100 move. We have more breaking news here on the airlines lets get to eamon jacksonvilveh white house. Thats right. We are told this meeting may be breaking up right now. It is a meeting between airline ceos and the president of the United States in the oval office which has been going on this afternoon. I am picking up on a relatively intense controversy thats been swirling behind the scenes about this meeting let me tell you what the controversy is a person familiar with the meeting tells me that the us air carriers here requested a meeting through mick mulvaney, the White House Acting chief of staff, with the president of the United States, and then after that according to this person the white house invited Qatar Airlines to attend the same meeting. Now, the meeting was to discuss, according to this person, the frustrations on the u. S. Side about Qatar Airlines and their ownership stake in an italian carrier flying into the United States they feel it is anticompetitive they feel it is not fair, and they wanted to voice some of those grievances when the qataris were added to the white house meeting, im told the reaction was, quote, utter shock. The person said they were shocked that he would be included, the ceo of the Qatar Airlines it must have been a Jared Kushner idea, this person said maybe jareds getting 666 fifth avenue refinanced right now in this meeting so some intense frustration here on the part of some familiar with this meeting that the qatari side even attended. When you look at the list of airlines that are in the room with the president today, you see that it is some of the big american names, American Airlines, yufr nighted, jet blue, and also qatar, fedex and atlas, which is a cargo carrier. Both sides of this debate are represented in this room now, i can also tell you that i spoke to a white house official just now about this who pushes back on this characterization of events and says that qatar was always scheduled to be in this meeting and that Jared Kushner is not scheduled to attend the meeting. That is he wasnt on the official invite list for the meeting. The person familiar with the meeting initially said that they suspected that Jared Kushner had been the person to suggest that the qataris be invited but the white house suggesting that may not be the case. So a dispute here. Some real hurt feelings and some controversy behind the scenes about this meeting, which is just breaking up now, melissa. Basically, eamon, the u. S. Airlines feel that perhaps the administration is sort of taking the side of Qatar Airlines and this also the backdrop is the house, as i understand it, has sponsored a bill limiting the access of Foreign Airlines flag of convenience i think is what it is called where they have joint ventures such as Qatar Airlines to access the u. S. Yes, i think the feeling on the american side is the president will see it as about american jobs and that will be the way this is adjudicated, this dispute but well see what happens the meeting is just breaking up now, but i can tell you during the meeting you are hearing from people familiar with the meeting, and theres really intense frustration and shock that the qataris were invited to the thing in the first place. Eamon, thank you. Eamon javers at the white house for us. You bet karen, i forget what company you were talking about being called to the white house and the hill and you say it is never a good thing. Right. What do you make of this meeting . Youre a shareholder in the airlines. Right i would be perturbed if i were an Airline Executive to be sort of blindsided, one, but even if you werent blindsided, two, this is the president who talks about america first, right you would think that that would be what they would hope to come out of a meeting like this. Right. Not after the qatar. Right grasso. I dont know what the meeting is going to result in. There was a lot of he said, she said we dont know what was said there, so getting back to a trade, if you look at delta, lets tie it in with the boeing trade. If you look at delta no exposure to max. Or limited exposure to the max, and then you get American Airlines with exposure or united with some exposure but the stark difference in the yeartodate performance you cannot deny. Delta airlines, quickly, i thought the quarter was great. They raised full year guidance, the stock at 8 1 2 times forward earnings, still cheap. 60 was the breakout level, i think now at an alltime high. If you want to buy an airline, you trade delta. Microsoft jumping after a conference meet. The Conference Call is about to kick off in the next 90 minutes. Plus new kids on the street reported earnings, chewy and crowd strike out with their first report after going public. We will bring you the latest there as the stocks are up live itin mes square in new york city, much more fast money right after this oothpaste away. And you should be mad at people who take unnecessary risks. How dare you, hes my emotional support snake. But youre not mad, because you have e trade, whose tech helps you understand the risk and reward potential on an options trade its a paste. Its not liquid or a gel. And even explore whatif scenarios. Wheres gate 87 . Dont get mad. Get e trade and start trading today. Here, hello starts with hi mple. How can i help . A data plan for everyone. Everyone . Everyone. Lets send to everyone [ camera clicking ] wifi up there . Ahhh. Sure, why not . Howd he get out . a camera might figure it out. That was easy glad i could help. At xfinity, were here to make life simple. Easy. Awesome. So come ask, shop, discover at your xfinity store today. Earnings alert on microsoft up more than a percent after hours on its earnings. The Conference Call kicking off in a few minutes to john fortt with the details. What we want to hear on the call is the guidance it is the end of the fiscal year, beginning of another one in this particular report where microsoft showed strength in a lot of business units, one of the areas of investment was artificial intelligence. So if that operating expense guidance is a little higher or a little lower than expected, well see, expect ai to be a part of that overall not only does the cloud momentum continue to be solid with azure still picking up its share of the slack, that intelligent Cloud Business faring well, also productivity business process you look at office 365, you look at linkedin, the mix there actually positive for gross margin goes at microsoft so expect to hear a little more about whether it is going to continue, guys. All right, john thanks john fortt keeping us updated heave. Dan, what do you make of the quarter . Pretty astounding Revenue Growth at 12 . Obviously john mentioned margins in the key cloud areas Margin Expansion is one thing that is really important one of the bear cases into the quarter was that a third growth is slowing, at 64 year over year, you know, a big run rate i think it was like north of 10 billion, but down from like 75 the last couple of quarters. Here is the thing. The stock is up 33 coming into the year with a massive trillion dollar market cap. It seems to be a lot of unusually positive sentiment here and putting up the right numbers. To me i dont know how you buy the stock at 138 at an alltime new high, making new alltime highs every day this quarter, but theyre doing a lot of stuff right there. It is impossible to say anything negative against microsoft. Except the valuation. Well, even that i dont know. I mean you probably have a problem with the valuation. A little. But i would use the so you say i would treat it as wait until it breaks through 140, treat it as your support level but dont buy it here. It seems aggressive buying at alltime highs. Where do you see it it is a little rich every time it comes up i feel stupid not owning it but if they are successful having more subscription revenue, the pe should be higher it is interesting that, god, those numbers are fantastic and stock only up above 80. Why wouldnt they get an expansion . It is my own fault, having seen it at mid teens, it is hard to do. Now at mid 30 i think it is a question here, and that is does the stock deserve a rerating the prior metrics in terms of being highly valued should be relooked at, reexamined and maybe brought higher. To dans point, it has been getting that for the last year dan coined maga, it is brill yaan and the m in maga is microsoft. There you go. It used to be mattel but he changed it. Brilliantly changed it. At certain point valuation matters. Youre right but it is trading 28 times next years earnings. You could say a lot of great things operating margins, much better than the street was looking for. At a certain point valuation matters, and we played the game what is that game we play. Which game . There are so many. Thats the new game. Pick your poison is genius. Trade it, fade it, would you rather you came into microsoft and said look, im trying to play by the rules, but i would trade it in earnings and pull the rip cord and ill stand by it. Is there a chance at 150 i think somebody put a 150 price tag on it. Maybe. With the stock sitting here and john fortt just said youre going to wait for what is it, fiscal 2020 guidance looks like, eps is expected to grow 8 , a massive deceleration from the last few years despite the margin improvement and sales are expected to grow 10 i think you have to go to 20142015 when satya took over and they changed to cloudbased model. Earnings were not zbroeing and the stock was dead in the water and started to take off with the numbers up when you have the deceleration, talking about buying at alltime high i know you are not, but im saying it seems odd. You had a shock when it broke out above 120. I agree when you see walgreens science, university lever with 155,000 it is catching on and better than the old model it all hinges on how much more the multiple expansion story can go from here you know, dan looked at me with daggers did you see that you were looking he looks at everybody with daggers. What are you mad at me . I havent even been here. Well have more on microsoft throughout the hour as that Conference Call is getting under way. What trade war semis are surging. Find out what bigger breakout could come for the chip stocks im million. You are watching fast money, first in business worldwide. More fast money right after this welcome back to fast money chip stocks once one of the hardest hit groups amid the trade war, surging in the last month, up 10 . Bob pisani is here to break down what is behind the rally hey, bob. Hi, melissa it is a big week for Semi Conductors they both hit the highest levels in two months on positive commentary from Semi Conductor equipment making amsl and from taiwan semi which said it expects a stronger second half of the year as 5g telecom related demand increases it has been a tough slog for the semis. First the global slowdown cloppered them at the end of the last year. Then u. S. china trade tensions, then huawei ban and japanese export restrictions against south korea it led to lower margins overall. Despite the worries, a basket of the largest players is only 3 from historic high in late april. Even a few individual breakouts as well. Klatencor, asml at historic highs, Texas Instruments and anna log devices off historic highs. What gives in str investors belief it will only get bigger, not just the pe space or smartphone, it is cloud computing, artificial intelligence, 5g, auto the principle Semi Conductor firms are bigger, theres more consolidation and a belief they can better handle the peaks and troughs. We will see. Even the bulls admit the whole premise could fall apart quickly if the Global Economy slumps more or the trade wars intensify. Back to you, melissa. Thank you, bob. Bob pisani at nysc lets trade it here. Good news out of taiwan semi. Which is a bellwether dan and brian kelly when here will point to them saying it is a bellwether quickly on micron, and obviously it was right but i have it wrong now since stock was trading 39 i looked at the quarter. It was 32 stock made sense it rallied, but you look at it revenue is down 45 and nan down 24 year over year you have to say to yourself, it is declining business, stock should stall and now trading 44. 5 people are saying what bob just said in terms of the other names, if you want some beta i think zylinks at 123 is the one you want to be in. On micron, micron i was negative on as well based on d ram prices, it popped up 40 today, but popped 37 to guys point of where pop was over sold now micron is overbought if i had to pick one, amd is up 80 yeartodate still not over bought. I would buy amd or nvidia. How about a Bigger Picture read on this we said 10 in the gain . Here is what i take away from taiwan semi, it is a company that guided down a couple of times in the last year and said we have seen the bottom of the cycle and we expect demand to increase in second half of the year those are the sort of confidence and outlook weve not heard from cyclical ceos of companies thats interesting that said, if you look at taiwan semi, it has been amazingly volatile stock since 2018. Theres been three peak declines of 20 here so getting back to the prior highs. Look what they did there getting back to prior highs, but i think we need some more data on trade before you want to play Something Like this for a breakout. To me i see the whole space as sort of a sentiment trade im not of that sentiment right now. Im nervous about the economy and a trade deal so im staying away from the whole space. I have a would you rather. I love this game. Would you rather. The upgrade on sty works solution, would you rather skyworks solution or the qualcomm downgrade by barkleys given the choice of those two which is the biggest of the game. I just got to make sure that people understand that, the two point im kidding rather be in the skyworks upgrade than take qualcomm downgrade in the would you rather gain. Why i think qualcomm is too cheap. I think they have a great Balance Sheet and you are playing stock market with qualcomm i dont think you want to short that name. Next guest says something is happening in the market that is signaling an even bigger rally for chips. Lets go off the charts with rob slimer of funds stock. What are you looking at . Thanks. I think what is happening it is the thin evenly of a bigger trade developing for the Broader Market cycle if we look at the opposite side of the trade and we look at the bond proxies, we think bond yields are oversold and due to rebound moving into the second half the names that benefited from that, staples and utilities we think are at risk. Looking at a couple of the charts, it is interesting. If we look at the trend channel or trend line at the upper end of where pepsi has been trading and then we look at where the momentum indicators are, we think that after this big move that we have had into 2019, theres risk in these stocks but they come back in. So were much more interested in trimming exposure to names like pepsi or if we look at some of the utilities and southern is a pretty good example of that. If we drawn the long trend line, a little sloppy but right there. We have southern right back to the old highs and here again that momentum indicator is beginning to peak. We think youre at risk here in the bond proxies of a shift away from defensive areas as we move into the second half, and you want to look at more cyclical names. Now, we have been lucky, bullish on the Semi Conductor since the beginning of the year, and the reason for that lines up with what we saw in 2016, a major low off the 200week thats the fouryear average we saw something very similar for a name like Texas Instruments. Granted, it has rallied right back in resistance here, but this little consolidation in the upper end of the range we think is bullish if you get a pull back you may have blims ps as we get into earnings, but it is a bigger consolidation over 18 months and moving higher. We think the momentum indicator here is still very bullish for something a little less extended and a few other names that lagged, we still like the semi cap names gep, here is a name that pot onlied off the 200week moving average, almost exactly in the Fourth Quarter last year you had a very nice, orderly pull back. If we were to have a 200day moving average, it is right there. We think they go higher. We think you want to own semis, sell bond proxies or reduce your exposure and add to more cyclical themes for a second half rally in more cyclical stocks. All right rob, why dont you come on over to the desk. Jonah will bring in a chair as he does. Maybe the best ever. The best ever in history. In the pantheon of pages. In the partheon. Do you think there will be a risk on trade in second half of the year i do. I think we are starting to see that i think reaction to semis, there were all kinds of opportunities to see the stocks sell off we had the pullback in the Second Quarter this stock had a huge run, pulling back i think they go higher whatever near term blips we get into in terngms theres another stock if you look on the 200week moving average it is coming off the longterm trend. I think the cycle is higher. Yes, risk on i think you want to favor the cyclicals. People are massively not positioned in those names and overly positioned in bond proxies. The market indexes may not make a lot of headway names like microsoft could trade side ways here but it is participate of the defensive move. Where do you put a name like starbucks . It closed on dead high today, up 23 , up 42 on the year. I am trying to figure out what bucket it would go into because it seems kind of risk on, but is it i dont know what is going on there. I think restaurants as more risk off. Really . I think so. It depends on what restaurant. Good point. A mcdonalds versus a sitdown quick serve restaurant. Fair enough but they have generally been outper fofrming through t outperforming through the Second Quarter where the more cyclical names sold off im more inclined to trend exposure nothing wrong with the chart. It is a great chart. Isnt it great . It has gone up 20 in a month and a half, literally a Straight Line the valuation is getting stretched and growth is Single Digits to earnings. Fine, but not breaking down yet. Theres no evidence of divergence, still leading and working. You have to wait for signs of a turn but it is not where i want to put more capital. Same thing with microsoft. Great chart, nothing wrong with it but at the upper end of a trend channel. I probably would go side ways. How long do you wait . Im long cyclicals how long do you wait some either moved side ways to lower. If you dont see the rotation, do you start to rethink your thesis on that it is always a risk i am always willing if the data changes, i will change my mind but i think you buy this stuff now. Look at some of the financials starting to dig in laggards like schwab are right down to the 200week moving average, looks very timely industrial names, itw, cat, these things have all gone side ways for 18 months yes, theyre not great, yes, theyre not leading, but positioning in them, i dont think theyre over bought in any way. Thank you, rob. Do you agree with rob here you are leading me to bring rob back but im smart enough to know i dont bring back the guest. I am not. Here would be my concern, okay it is not a political show, but you got to look at this through the lens of president trump. Stock market is at an alltime high is it more inclined now to play hardball with the chinese based on the fact that the markets at an alltime high and he has wiggle room . My suggestion would be yes i think the trade talks with china get more difficult, which is the reason why i would avoid the semis at these levels. Does that make sense fundamental view is at odds with robs technical view. Robs gone so i dont know how to answer that, but, yes, my fundamental view is at odds with robs technical view. Whos rob lets check on microsoft as we head to break the trillion Dollar Company jumping up more than 1. 6 . Conference call is getting under the latest krou strike report earnings for the first me atis public companies. Much more on those reports when fast money returns welcome back to fast. Check out shares of pet supplier chewy and crowd trike, both in the green on first Earnings Report seema mody is covering chewy seema, kick it off. Hey, melissa. The first Earnings Call for c e chewy and the ceo touching on highlights, including investment into pet health care, expanding its chewy pharmacies to provide for pet Health Care Needs and laufr launching a new faepharmacy in arizona. It has opened a new area to deliver products in two days or less theyre banking on more growth Going Forward. Two things. First of all, if you look at in 2017 it was about if you look at average household span of around 900 to 1,000. If you look at ecommerce penetration in the United States it is still low. We are still early in our growth wall street analysts already reacting to chewys report Wedbush Securities telling me time will tell whether the company is able to deliver strong margin improvement at the same time grow the top line rapidly. How chewy navigates the promotional environment with amazons recent more aggressive offers will be important to monitor. Now, it is important to note it is not just amazon that is a big competitor to chewy. Jm smucker recently strengthening its pet food portfolio with a 1. 7 billion investment, and General Mills buying blue buffalo. Share is up in after hours, trading up over 44 in extended trade. Im curious, you and the guys on the desk, how many own a pet you, you, everybody except me. Me as well. But per capita we have more than one per person. There we go. Yes. Seema, thank you. Seema mody we will trade this in just a moment, but we want to hit crowdstrike. That stock is soaring in after hours session. Rahel solomon back at headquarters with reaction to results. You could count me in i also have a pet. Crowdstrike up more than 8 , almost 9 in after hours trading. The numbers in line with what the Company Reported in june on s1, but here is the interesting thing here the Cyber Tech Company raised guidance for q2 and full year. The Company Reported Revenue Growth of 103 year over year. Alex henderson of the company telling me it was a bit of a surprise to see the company raise guidance, telling me, quote, the company is really crushing it. Customers love the efficacy. They stop the breach it is first report for the firm after going public last month. For context here, crowdstrike is the company that the dnc hired to investigate the hack of their systems that the russians were behind we see the stock trading around the 72 range, around 79, more than doubling the ipo price, up 34 melissa, back to you. Rahel, thank you. Rahel solomon, pet owner as we know now lets trade these names. Where first, dan lets do crowdstrike. Listen, we talked about a lot of recent ipos and firstist quarter out of the gate and you have to crush it like the analyst mentioned. They saved a little, guided revenues up for the year 5 . But i think most importantly the loss, annual loss is lower than expected i think analysts expected about a buck and guiding to about 0. 71 loss those are the sort of things trading about 80 in after market you heard me say this before, stocks that traded 80 usually go to 100 when it is all said and done, especially if you think the market has more lags. Can i ask why you say that . We were talking about starbucks at 91. Ever been there . It is going to 100. Just gravitational pull yes. The same way on the way down. See, it is not gravitational pull it is the same way on the way down once it trades into Single Digits company is usually going out of business. Thats a long way. The last 10 on the way down. Wouldnt gravity pull something lower . Thats true apparently it depends on where you are. Can i play the chewy card of course. I mean crowdstrike is nice and interesting, but, listen, real, live stuff i have been away a couple of days, i come home tonight, crickets dog walks in the room and it is like everybody won lotto thats the difference in the world. Active customers up 44 year over year, operating margins better it is a very good story. If you dont think there will be competition, you buy the stock i just dont think they have a big enough moat to justify this valuation. Amazon and walmart, right. Two words. Right so of the two, to me i like crowdstrike better i mean as dan sort of alluded to, this is a managed Earnings Call, right . They didnt go public that long ago. They had very good everyone knew what to expect. Everyone knew what to expect and where they were, how they could beat raising the bar for themselves, they must feel confident i agree with dan. Are we treating it like a growth stock if we are, the way theyre trying to get to profitable, Crowdstrike Crowdstrike is cutting sales it sounds like a Mature Company to me. I wouldnt touch either one at this level i think crowdstrike has a little headwind Going Forward i think people just wanted a piece of this because it was sexy a check on microsoft once again. The tech giant holding on to gains in the after hours session as the Conference Call gets under way. We will hear from the ceo in a few minutes. Plus, check out the cramer cam. He is talking to bank of america ceo. You llot biewi nelve how he says millennials are boosting their business those comments right after the break. Prevagen. Healthier brain. Better life. All t welcome back to fast money financials higher today as we near the end of a big week of earnings for the Big Banks Bank of america Ceo Brian Moynihan sat down with mad moneys jim cramer to discuss the quarter and how a Certain Group is helping boost their business. Theres a debate whether banks like us appeal to millennials. We open accounts three times the population rate in new sales we have about twice the population rate of millennials in our Customer Base today they have, you know, 60, 70 billion of checking deposit just the millennials and gen z add more on top. Those who are digitals or millennials have 2 billion in investments and deposits on loans with us. You can catch the full interview coming up top of the hour, 6 00 p. M. Eastern time in the meantime lets trade financials i would think millennials in some respects are a dream cohorpt for bank of america because they dont like tellers, dont want to go into the branch, do everything digitally and it is the most efficient way. Unless they want to do it digitally with someone else. True, i guess. Because it is easy to do that good for him i think, you know, i think theyve done a great job i think the stock here, even though it has had a nice week, still not expensive. I do own it. I own jp morgan, i own city as well i think bank of america had the strong ebbs earnings of the quarter. Good foreign them. Im glad to hear it because it is the one threat that gets me a little nervous you know, when you look at the financials, i down play them jp morgan is up 18 yeartodate, bank of america up 17 yeartodate if you go back to 2016, bank of america outperformed google, facebook and Morgan Stanley by three to one. From the beginning of 2017 to date 2016, so you had the big bump for lower regulation, lower taxes. It is up 137 against the google, up 57 . It is interesting when you hear Brian Moynihan talk like that and kind of focus on the millennials and the percentage of their business and growth there. It makes you think about square and pal pals venmo and you say to yourself at some point will we see deals to get some of the properties that already have very good adoption amongst this group. Some of these guys we will talk about in a bit are not having the same success maybe a wells fargo in this demographic. I understand why jp morgan gets a premium valuation, the bank probably deserves it. The bulk case for citi which karen can speak to is trading at discount to book value which is 79 1 2 thats what the bulls will look at bear case is maybe trading tangible book. I am finding myself somewhere in the middle which is where the stock is european banks i believe are in trouble and you have to be wary of in my opinion the bank with most exposure and that would be citi. Financials are up nearly 20 , but a trader says a Bank Breakdown could come this summer dan, you want to head to the plasma lets talk about the xlf, thats the etf take it easy, buddy. You know, we had all of the Money Centers report this week jp, bank of america, citi and wells fargo, thats about 30 of the weight of the xlf. What is interesting to me is that the xlf, despite what looked to be decent results from most of the guys, is down on the week so put volume is 1 1 2 times average daily value and one trade caught my eye. It could be protection maybe against a basket of some banks, but when the etf was trading at 28 today there was a roll, there was a seller of 5,000 of the august 27th put and a buyer to open of the august 30th. So give themselves two more weeks of down side, down to 27 maybe that is protection, but it is really interesting. Lets look at the charts here. I know a lot of people want to be constructive on valuation and those results seem pretty fine here, but, you know, we just finally have this thing breaking out of the down trend thats been in place. Thats the xlf you know, i just want to make one point. We talk about jp morgan all the time a lot of overhead resistance here at 120, but, well, what do they say the longer the base the higher if space that thing finally gets out. I think it is the one people crowd into lastly though, this one, this is a massive bank, wells fargo here we know they had a lot of problems look at the down trend, cant get out of its over way. Some people might call it sitting at 45, massive, massive longterm Technical Support here i would say it is possibly one of the triangle of deaths coming here so be careful, wells fargo, to do down side below 45. Triangle of death and a louise yamata callout. Thanks, dan. For more options action check out the full show at 5 30 tomorrow eastern time. Tweet us surprise guest the other day look at shares of burger king, red robin on fire in the after hours session. Atairwoman may have a clue on wh is behind the move, up 10 . That is coming up. Options action sponsored by think or swim by Td Ameritrade welcome back to fast money check out shares of red robin shall soaring in the after hours market, up more than 10 after filing a 13d schedule. Karen, you are in this name so lets get the fine print. The fine print is vintage who is the big 11 1 2 holder. We saw a few weeks ago they made a proposal for 40 a share they have amended their 13d filing today and theres a few clues that are very promising i think. One, they say discussions are underway or continuing discussions. That means the board is now open to at least having a dialogue with them. Thats really important. The second thing is in that filing they laid out generally not with the greatest of specifics but generally with the financing for a deal that they would want to do at 40 would look like. The third thing is now i think the situation is one where other bidders can come in. They didnt want other bidders like a roark or somebody, wouldnt want to be hostile. If there was a process in place though, then they could come in. I think we are now looking at a situation where there is a process in place with the stock here and a potential 40 bid on the table, i think it is very attractive. You stay long i stay long. You went long when the activist first came in. I went long when he came out. The stock was trading 44, 43, traded down to 30 because people hadnt heard anything. He is back. Your worse Case Scenario is 40 worse Case Scenario is the deal falls apart and theres no deal but i think 40 is not the most likely outcome i think higher is more likely. Lets get to microsoft hitting after hour sessions highs. Call is under way. Lets get to john fortt who has been monitoring it. As you would expect in a quarter like this microsoft Ceo Satya Nadella taking a bit of a victory lap and emphasizing cloud. Take a listen. Our commercial Cloud Business is the largest in the world, surpassing 38 billion in revenue for the year with gross margin expecting to 63 im proud of what we have accomplished over the last 12 months and im energized by the tremendous opportunity ahead. Every day we work alongside our customers to help them build their own digital capability, creating new businesses with them, innovating with them, and earning their trust. Hoping to squeeze in microsofts expense guidance, but we havent gotten to it yet. Cfo amy hood working on that portion now. Back to you. Thank you john fortt back at headquarters. Steve grasso. Looks like it will take a run at the 140 level it is right there, and i will be impressed if were a couple of days out, lets say next week and we are trading in the mid 140s, then you have to say, okay, you know what . Rip up the script, this stock has a lot of runway ahead of it. If it fails here and comes back down, then we were all right at the beginning of the show to say you should be selling at alltime highs versus taking a leg into the name. I want to look into our crystal balls. Do we have those . Apparently we do. Is there more than one or just one how the after hours movers will trade in tomorrows session. Boeing is now up 2. 4 on the news we brought to you guys earlier about taking a charge in the Second Quarter for the 737 max. If you are asking me to stare into said crystal ball. Stare into said ball. Remember the wizard of oz, the wicked witch had that and she surrendered dorothy, right you saw it in theaters, right . I dont remember that. They actually you done yes. I think boeing holds the gains and builds on the gains in post market, if i am piering into said crystal ball. I would say microsoft really interesting when they reported q3 back in late april, the stock gapped up and we were talking about everyone it was an exceptional quarter and a few weeks later it was down 8 , 9 these things dont grow, especially when theyre a trillion dollar plus market cap. Does it help tech overall and specifically i think it is great numbers i think it does. The whole pie is growing i dont know microsoft specifically, but yes. Microsoft again up 2 perps here up next, final trade time for the final trade steve grasso. Keeping it in the same theme as pets where chewy i didnt like, zoetis, zts. Karen. Red robin if it is good enough for the e block good enough for final trade. Up 16 after hours. Dan. Microsoft, the breakout level was 130 a few weeks go a thats where you buy it. Guy adami. The only thing constant in life is change, and we have a crack stack but kristen who you will see on the screen right now. There she is. Last day at fast money. She was with us forever it seems like, but youre not leaving each other because she is going to the power lunch. She will be a senior producer on another fine program. Ditched us to stay with you it is an unfortunate we will sorely miss her. Mel, i think gold market continues to go racing higher. See you bac out 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 mad money. Welcome to cramerica im not here to make friends im trying to make you some money. My job isnt to entertain, but to teach contacts call me 1800743cnbc. I have a simple rule of thumb here at cramerica. Always go for the ea