Has the details. I just spoke with kirk over at isi i wanted his take. He said microsoft is firing on all cylinders, beating all three major categories, Strong Quarter across the commercial franchises it was better than the street was looking for. Kirk said growth is translated into increasing profitability. He said are enterprises willing to spend giving this backdrop and in one of those segments he mentioned 12. 3 billion up 11 . Commercial revenue gross of 20 . Intelligent cloud 13 billion up 20 . And more personal computing, up 6 shares not doing a lot in the after hours. The forecast will be delivered on the call which starts at 5 30 a. M. As josh mentioned, no guidance i am sure every one wonders what they will say about Enterprise Spending especially with the news delivered yesterday what do you make of the quarter . They hit on everything. Josh went through it across the board better, with the Cloud Services area. What we are waiting on now is what is the forecast, what do things look like Going Forward how is the spending going to look i dont think they are like asp. I think that was a individual thing. I dont think its microsoft but it made a dramatic run over the last month or two or three it makes sense maybe it is pausing and until we start getting some of the guidance, a lot of the people are focused on that im one of them. I want to know what the guidance looks like, but for now they hit on every single metric what a difference a quarter makes. Guy, last quarter the stock was down 7 or 8 because of the disappointment of it and they came in at 48 you talk about a business with 38 billion in revenue split even across three different Business Units on top of that you have operating margins of 42. 7 i think the stream was at 39. 5 . Think about how that has been. It is a wonderful business the only knock people will make on it is valuation if you look at the numbers i look at, you are probably looking at a stock trading close to 30 times next years numbers. I think thats okay. Stopped on a dime over 200 i think you have seen the selloff already or do you want to look at price in sales by your average 7. 5. 23. 9 for ebida where are we on the valuation of this stock, tim, in your view . If the company is rerated pete has done a nice job pointing out where it wasnt expensive last year. Credit for that. Picture metrics is a software company. You could be leaning higher. In 2022 its about 32 times. What can i add the public cloud Gross Margins of 71 are extraordinary gaining revenue which is another area we havent talked about maybe consul goes away but plus 22 on gaming there are a lot of different stories that are what make this company give investors as much confidence in the text base as any you are at 48. I am not sure you are supposed to be doing cartwheels, but how much do they steal from aws. I think people believe they are. A slower line that is the expectation for the next three or four years. I dont think where it trades now is unfair. And getting the boost from the coronavirus. Video game, Xbox Gaming Services up 30 usually september is a light quarter. Not so this time around. People are at home, gaming, like you. Exactly lets unpack this so the guys hit on a bunch of stuff. What does guy always say he says bad news, good price action thats very telling. Today we had great news and bad price action thats very telling as well. So on the exchange when it comes to the last couple minutes of the day, you get closing balances everything has been for sale in the tech space all of these names are for sale. All of these names have topped out in september it all came in drastically after september. They bounced back but made a lower high i think what the market is telling you, they are done with tech even if microsoft looks great, i wouldnt be investing in it right now. Thats your position and you have taken that position for a while. Guy, isnt it too early, since you are the person who says that the most, good news, bad price action, blah, blah, blah its too early to say bad price action we havent got epiguidance we only have half the story right now. I dont think steve is talking about microsoft in the after hours. I dont want to speak for steve. He is talking about since september. Some of these have underperformed if you are waiting for bad price action, maybe you are too late to do the trade. I hear what he is saying but there are a couple of tells to me, the fact that zoom video ratchets higher leads me to believe we are nowhere near the end of this covid thing. I think microsoft is one of the winners. I will wait and see what they say. I understand what steve is saying entirely, but you break down this quarter, the slowing growth seems to have abated. You talk about a company with three different Business Units firing on all cylinders for all three. I hate to say this, but it seems like a winwin situation if the pandemic goes longer or if it ends if it ends the Economic Activity will likely come back and resume and be strong at least in theory, but if it continues, people continue to work from hom home is this his tenure as ceo obviously cloud has been the focus, but they didnt leave out things like surface. A lot of people would have said lets get rid of that. They made the acquisition of linked in as well. So they have positioned themselves nicely for what we are seeing to your point. And by the way, the consistency of this company is extraordinary. You have 20 of 21 quarters where you have beat on earnings and 20 of 21 quarters where you have beat on revenue as well. Because of the growth and tim was referring to this a while ago because the growth is there and so strong, we havent even talked about cash flow. The Free Cash Flow of this company is extraordinary the cash on their Balance Sheet is extraordinary this is a company sitting in a great spot because if they choose to do anything for an acquisition, they can easily do that at this point in time they can do it for whatever, whether its buy back shares they can do whatever they want all of the good execution that we have seen in all three of these major categories, and to guys point they are almost distributed perfectly across all three. Its amazing what they have been able to build. This performance by microsoft, knocking it out of the park, is that microsoft specific or is there an extrapolation to the software . I think microsoft is in more of a sweet spot in terms of the public cloud i do think the s p story is somewhat idiosyncratic i think we have to be concerned about Enterprise Spending. We have heard enough whispers. I mentioned it yesterday intel has their own problems we are about to talk about another problem for them but in the shortterm i think its something the market needs to be thinking about it cant go at the same pace and the Competitive Landscape in cloud cant go at the same pace. But microsoft, you have to feel good about the value proposition. This is 20 billion a year in buybacks and dibs they are giving you which supports the stock. Lets bring in jason. Microsoft is among his top Holdings Thanks for having me. The phone call is about to begin in about 20 minutes. What question would you ask . Part of what you already mentioned, year to year growth on their Cloud Business which i think is important at the end of the day we are looking at their market share. So they own 18 . Solid number 2 behind amazon for us thats been the focus thats where we see opportunity. They are a vertical for them as they continue to move along their journey in the cloud base. This is your largest position, jason. I wonder if at any point or have you trimmed your position out of Portfolio Management and also given the backdrop of uncertainty and volatility going into the elections. Absolutely. One of the things. Microsoft is a legacy name 1. 6 trillion market cap. When we look at the multiple expansion we have seen particularly in technology for microsoft. I think for us it is a strong hold, not adding any more capital to the name. We are seeing about the head winds with covid19, as well as lack of stimulus so it is a stronghold right now. Thats exactly where i was going to hit what would make you add to this position, and, b, are you nervous under president bide epithepn that your cap gains tax will double i think it does play a role what i had looked at postelection is what are the bipartisan issues and looking at the cyclicals. I think for us it is some Infrastructure Spending that might happen we do think the fiscal stimulus will happen as well which will turn us away from some of the industrials. That will be the reallocation of capital. Thats how we are looking at the markets from a tactical standpoint jason, thanks quickly, guy what question would you ask when the Conference Call gets under way in 15 minutes . Is he concerned about the Enterprise Spending. Tim addressed it at well i think everybody said it in different ways what is the virus Going Forward, is sap sap specific or is that negative things in the entire space. I would phrase it differently, but that would be the question Conference Call in 15 minutes. We are still awaiting guidance big deal news out of the chip space. Advanced micro bought xilinx here is the question was that another blow to intel who had struggle in the data business i dont think the Data Center Business for intel is mortally wounded. I think the bigger questions are outsourcing questions. I think its truly on the manufacturing side that i think intel is challenged. I think the core business and Data Center Business is doing fine this deal is about amd yes, they talk about the synergies, the complementaries. It is also about spending 35 billion in an all cash deal for a stock that is up 65 since july this deal makes ton of sense if you are amd. Thats what i think. But intel has to fix their own problems grasso . Obviously if amds numbers are better and intel is weak, they are stealing Business Intel has been plagued with their line would i rush in . Probably not because you know where i stand on macko base. Macro base. Amd might have had a problem getting to things. Intel is not there as well either i think to add this up, if i, on a macrolevel, have a problem buying tech, but on a granular level i would rather be in amd than intel that was not a would you rather, but myself of course it was. Pete i would say, quite honestly, intel has been struggling. Their execution has been awful i am saying this as a guy who owns the stock its frustrating to me we have seen some of these the data center is one of those where there is also amd makes a great move because it opens up its also data center and you look over at a deal where invidia did a purchase my question is intel, the stock pulled back and it pulled back further. You wonder are they doing the right thing. Have they been able to react i have not seen that and meanwhile we are seeing their competition make moves that will hurt them in the future. Pete mentioned guy. We also had Analog Devices maxim. If memory serves me, guy, you said a great takeover target so given thats a great question i dont know you put me on the spot and i cant answer it. I can answer this. I wont make any friends saying this it comes down to management. The gms move up in the draft to get the players they want and others sit back. Intel is sitting back and waiting and nothing is happening. And other gms are moving up in position look at intel. Year after year for price, it is a disaster and in the would you rather game, even though amd has had a huge run, i would rather have amd still. And i think barkley slapped a 100 tag on it do i exist as a maker of the show this is infuriating on a tuesday. Tim seymour who has his hand politely up. I raise my hand and follow orders could you ask guy who won the power stock lunch draft last year was it tim seymour . If it is not going to be me its noah syndergaard. Bitcoin are climbing to its highest peak since two years ago. Is it sustainable . Fast money is back in two. Mom at t has the deal for new and existing customers i will. So whatd she say . Its the wrong person. Its a guy named carl. But hes very excited and on his way. Wordofmouth advertising. Its what they did before commercials. Its not complicated. Everyone gets our best deal, like the amazing iphone 12 on us. If youre concerned about the environment and climate change, how do you find companies that are driving the right outcomes . If you care about economic equality and social justice, which firms are addressing it in their workplaces and their communities . For nearly 40 years, calvert has delivered competitive returns by investing in Companies Making a difference because we see value in doing good. Talk to your Financial Advisor about investing responsibly with calvert. Talk to your Financial Advisor about investing responsibly were committed to making college more accessibley, by making it more affordable, thats why were keeping our tuition the same through the year 2021. I knew snhu was the place for me when i saw how affordable it was. I ran to my husband with my computer and i said, look, we can do this. [narrator] take advantage of some of the lowest online tuition rates in the nation. Find your degree at snhu. Edu. Its moving day. And are doing the heavy lifting, jess is busy moving her xfinity internet and tv services. It only takes about a minute. Wait, a minute . But what have you been doing for the last two hours . Delegating . Oh, good one. Move your Xfinity Services without breaking a sweat. Now thats simple, easy, awesome. Xfinity makes moving easy. Go online to transfer your services in about a minute. Get started today. Welcome back to fast money. Shares of caterpillar falling after there was a 54 drop in earnings despite the result, it was better than estimates. Guy, this was your trade the other day. I only remember because you said meow people dont often make animal noises what do you make of this quarter and what it means in terms of the economic recovery . I think the quarter was fine. People were looking for close to that 155 level which is the top end of the range in terms of analyst and stuff. I get it it also, in terms of stock, a victim of its own success. We were talking this is a 130 stock and caterpillar was a watch. I probably stuck around too long it had a pullback. I think the past resistance becomes support. If you look at the quarter overall it was good. I dont think the world has gotten incredibly better, but incrementally better the time to get in these is when the news goes from bad to just good i think thats where we are at caterpillar. I continue to stay with it i think bad to good is good the ceo said he feels better today than a quarter ago thats not great but not bad either, sort of falls into that bad to good, bad to okay right now. The outlook was very upbeat about cap x in the Mining Center there are times in the show we cant hear ourselves because guys dogs are barking throughout the show. I find that ironic, but love them when they have to play the lap track, you know they have problems i didnt need the lap track it was funny it enhances the humor of the joke, the lap track. Pete has dogs and i have never heard his dogs on any broadcast pete is on well behaved dogs exactly but back to cat, ironically these dogs like to eat, mel yes, they beat the numbers, but when you look at the numbers year over year, they are awful they are down 50 here and 30 there. I wonder if there is a little more downside. I dont disagree with you, guy, and you are better with charts than i am. But i think there is probably 10 for this stock to fall and get to 147, in that range. But as you are looking at that, lookingforward there are possibilities because if things are Getting Better in china and here in north america with residential, i think we have a good shot for the stock to make a bit of a move, but i think it will struggle for a while. I feel like i am conducting a class. Yes, mr. Grasso, do you have a quick comment on cat i think cat is a better stock chart than microsoft a boat load of sim lutimulus cog out of china, just under 13 billion. After the election there will be a stimulus here. I would be down around the 151, 152, a shade lighter than guy. Thats where it checks at multiple times in the past months we have much more ahead its one of the worst performing sectors in the market this year. But our next guests say the banks could help hedge against any volatility we will dig into the charts to tell you how and later, have Tech Companies outgrown the mass i cive protections . We will bring you the trade when fast money returns congratulations welcome to the aflac program. Aflac now tell me, what does aflac do . Aflac pays you money directly to help with unexpected medical bills. And is Aflac Health Insurance . No, but it can help with expenses Health Insurance doesnt cover thats right. Are there any questions . Coach yes . Can i get one of those cool blue blazers . You know i cant play favorites. Alright lets talk coverage. Its go time get help with expenses Health Insurance doesnt cover. Mmm hmm get to know us at aflac. Com this was the theater i came to quite often. The support weve had over the last few months has been amazing. Its not just a work environment. Everyone here is family. If you are ready to open your heart and your home, check us out. We thought for sure that we were done. And this town said not today. Welcome back to fast money. The president ial election is one week away. Our next guest says he has the ultimate hedge lets go off the charts. Chris, what are you looking at i am looking at rates to start. I think if there is going to be a source of volatility it probably comes from rates up, not rates down that has been the status quo for years. I want to