Stocks is soaring. One trader says theyre leaving more room to run. On a day we saw s p making new record highs, we start off with notable names that have been, well, battling. Check this out. Heres a look at the worst performing dow stocks this year, verizon down 16 . Ge down 12 . Chevron down 10 . Exxon down 9. These names have another thing in common. Theyve all got fat dividends. Verizon has a 5 dividend yield. Ge at 3. 5 . Can a classing theory, the dogs of the dow, be your best bet as stocks hit record highs . Pete what do you say . I think some of these names havent been a part of this whole thing. Obviously, when you look at the energy names, we know how oil and that traded the capex is cutting back, all of that. When you look at Something Like exxon, when im excited, its holding the 50day moving average. They have very positive cash flows. Theyve done great acquisitions in the pervan and other parts of the world. I think its literally trading on the lows. I think the opportunity for the upside, any turn energy. Ive seen more and more paper coming into the energy space. With that turn, id actually to have to be exxon. Now im in the xlg. You we heard they keep on working, keep hitting new highs. That doesnt phase you . Do you then go search the bottom of the barrel . My gm did not make the dow. Its almost there. It feels like its firmly in that kennel, but, the adjustment is the cut. Its not over. I dont want to count them out yet. That would fit into it as well. Of the names that we, the top five i guess it was, ge is probably the most interesting to me. I do think theres a lot that can be done, just cutting expenses. I think hes a great ceo. He had a lot of Different Things that are beyond his ability to, you know, the financial crisis and ge being in that situation they were in. I think theres, you know, a lot of interest, things, tower, that is a tough place to be. Health care, aviation, there is a lot of moving parts and expenses, i think its not trading a crazy multiple if i had to pick a different dog than the dog i rode in on, id say ge. The reaction is downright disappointing. Investors are buying it. This market. We think back to the year 2000. Here we are now, they are taking over. By all accounts, hes a fine manager. When you think of what happened with ford, the way their board is going, theyre thinking of the next few decades, i think you can see that discussion going in the boardroom, with ge. I think it will be a positive. Its a much more competent Business Report for all intents and purposes, too. So what im saying, its not going to be that easy, foreign jumped up a percentandahalf after that announcement, you would have thought that would have given several investors a different angle. I will say this, energy, its not this just yet. I will tell you verizon is on that list. That stock is up, it pays dividends, theyre trying to transform that billions. Theyre going in that direction. I dont think it will look like a Wireless Company in a few years. Theyre making the moves to do that. At t and verizon with those yields and some of the moves they doing mna wise are very interesting to me. I disagree. Well, its funny, because when we talk about ge and honeywell around earnings, how they have been outperforming, that we played would you rather . That game you love to play, net turned out to be correct. Now i think ge is worth a look. I hear what pete is saying, its been around the level since february, riskreward probably sets up as well. Ge, through some faults of their own, they basically got out at the wrong time. They got into energy at the wrong time. Theyre probably a paid for nit spades. But at this valuation, maybe it starts to make sense, that coupled with the fact you will start hearing some noise about people getting involved, maybe on the activist front. Maybe health, do you think they can actually do anything . Well, he has a track record. Hes around for the long term. Hes not in it for a quarter. Maybe we will see him get out. He keeps pushing and pushing in a way that is effective. I find myself with dan. Whoa. I look at ge. I think, i like jeff. We met with him. Hes a great guy. How many bad moves do you get as ceo . Energy at the top, the capital. All the things you are talking about t. Stock is virtually down, down, down, down. Here we are, once again, how are our cash flows . Not very good. Theres a lot of things, you look at ge, theres a lot of things broken, they need to be fixed. Does it mean there has to be some changes . I think the answer is yes on the management side. Peltz is in there, you dont think its peltz has enough power to do the kind of radical changes of, yeah, in terms of the seismic mistake, does he have enough . I think theyre drafting changes that need to happen. Does that mean charles icon managed to force some change in term of the dividend and buy back policy. Its not peltz getting in on his stake. Its who else would be in the same campus. Peltz. I think that can be a meaningful difference. A lot of the shareholders in this whole painful run. Yes, its been painful compared to the Broader Market and compared to the rivals, that have crushed them. We talk about honeywell. We talk about them again, honey well, you all have a chart and General Electric chart, there is absolutely no comparison. I understand what pete is saying. Im not saying the fixes are easy ge. In riskreward this stock at 28 bucks, it sets up similar to exxonmobile. I think verizon is a wild card. I bm, the issues to me are plentiful. I think the changes are an overhaul. I think when you bring up carl icahn, its about buybacks and use tack cash. I dont think thats a problem. This is more of a management problem they need to have those changes. And that will take a lot more. We are throwing that term dogs in the down. Thats something to be used late in the Fourth Quarter to outperform the next year. Were using it as an expression. I think it would be way too soon to take a look at the lagers. A lot can change. Okay. If you think of the rotation the big cap, and that, going into stocks that havent worked at this stage of the game makes little sense to me. I think you want to do it much closer to the end of the year. Ibm you stay away from . Yes, that ceo has to be on the hot seat. Who runs watson . What is watson . They got great commercials outside of that, is it bottom lining with the watson . Listen, its a cognitive solution. Theyre trying to sell, you know know, to customers as a service, they have a tiny percentage of their sale. I think he told you last week it was a joke or a couple weeks ago. But his initial instinct was to call it say its a joke, absolutely. No way ibm. No. I owed him. You cant say no way and you own it. I own ibm. I am selling calls. Yesterday, all i do is sell calls against it. On top of the dividend deal, supercharge this thing, with the hopes that maybe they can turn it. Why dont you. I think they will. Are you waiting for buffet . Im actually not waiting for buffet to sell aerial, im waiting for him to get more active to make radical changes there as well. Speaking of the dow, our next guest says there is one compelling reason to buy, the cart master, carter is at the plasma, carter, details. At the plasma. Its getting down to tend. I want to start with that. The total return in investment blows away absolute investing. In fact, half of all longterm returns come from dividends. I try to remind myself of that, lets look at heard and now. So what we have is a two, threeyear chart of the s p itself, actual and total return. Of course, its quite clear, that you are starting to get a better result when you compound those dividends. Lets pull it back a little further. The next goes from absolute march 3, 2009, to present. And at the same circumstance. Right. But its starting to get even wider. Lets go and do all data. This is going back to the late 1980s you are now looking at something, of course, that is fairly epic. Weve got a double. Meaning, thats the power of the ditcheds. The dog to dow theory is that, if nothing more in a sense. If half of your returns come from reinvesting dividends. Dow is a pedestrian or a retail kind of thing, it is a very efficacious thing to do. These are actual data points going back as as far as is available. 1990 to present and what you get out of buying the ten stocks in the dow. The highest dividends versus the dow jones, itself. Okay. Here is a currents cart, a table, if you will. I will show you the ten names, names you know, names you all have spoken of. Yields in descending order. Look at the next page. Stalling. And it ends with an average yield of 3. 8. Now, by comparison, the s p is 1. 8. The dow, itself, is 3. 4. The final chart. Here is a group chart, one security. Orange. And here is the current dow jones, itself. I think its right to be doing this. And we can adjust it maybe in a second. I know you were saying, they found at any given time, 12 months forward as a strategy, this is principle worst. I think carter has to come over. Come on over, carter. Carter, carter, carter. Okay. Sometimes, carter, you get off early. Why would you put money thats clearly not working into the clearly working. Thats sort of the dilemma. Buyers, losers, or do you stick with winners . And there is no right answer for that. Ultimately the thing that will make the most money in a period, bar none, if you can find the ford motor step, the person thats invented suspect brandnew. That wins, thats google, finding apple. Eastman kodak. There is no such thing as growth stock. All growth at some point falters. The stocks go out of business. There is no Better Business than general motors. They went bankrupt. So the question is, though, if you are a more steady to longterm investor, to not think about dividends is to not think about half the gain. So the question is now, you said calendar year, any 12 months rolling period, can you take the names with the highest dividend and the fact that they will play catchup. The stocks in history show its a fairly efficacious thing to do. Does it matter where the rates are versus the dividends . You say high dividends. What constitutes high . Of course, you have to say is it a real dividend compared to where inflation is, of course, whats your earnings yield . And all these things, but the point of using a longterm chart is thats incorporated all sorts of interesting environments. It issing a knost agknostic to isnt there something to the end of periods where Money Managers kind of look to kind of roll stuff off and put new stuff on . Isnt there something i suppose thats what it meant. They couldnt have an arbitrary data to start it on october 11th every year. They had to make date that everyone can get their money around. Actually, it applies, its not just a calendar phenomenon. I think it was originally and its not. Its a test. What . Its a test thing. Well, theres that thing, too. It has to do with tax occurrences at the end of the year. Right, for sure. But actually no one mentioned mullen. I think thats one of the best on the list. So are there, on the flipside, are there Top Performing down stocks which you say trim down now . You want to buy lagers . Mcdonalds comes to mind, a little bit steep. We talk about that on options. Well see what happens. Yeah. I got to make one more point. There are a lot of puts that go into this. The reason calendar years are important to me. Investors think about this, when they report q4 earnings in january, they will give full calendar year guidance. Some of those line up, its important. They give management a new opportunity to reset expectations so you can go forward and make expectations. We seen that time and time again, go back to late 2015. What did walmart do . They killed their guidance, they wanted to set up to meet in 2015. They did, they have been outperforming since then. These are some of the things. Its based on a calendar year. I think as a concept, you can do it at any given time. Carter, thanks, just quickly, mcdonalds, you sell that . No, thank you, pete. I think its headed to, i think somebody recently put a 161 price target on it. We fancied about how it can possibly get there. And there are things we need to do from a transformative side. Well see what happens. We think its going down. Coming up, check our shares with Tommy Hilfiger jumping over hours. Plus, retail struggles, another Consumer Group and stocks are taking off. Well give you names and why investors are piling in. Later, while president trumps world tour continues the ceo rendered its Health Care Plan. They could have big implications for the big important tax cuts. We will tell you what it all means for your portfolio when fast money returns. shouting more power. Chords. With customized Loyalty Programs and datadriven insights, Synchrony Financial can help bring more. Power to your business. The future isnt silver suits anits right now. S, think about it. We can push buttons and make cars appear out of thin air. Find love anywhere. Hes cute. And buy things from, well, everywhere. How . Because our phones have evolved. So isnt it time our networks did too . Introducing americas largest, most reliable 4g lte combined with the most wifi hotspots. Its a new kind of network. Xfinity mobile. Welcome back to fast money. Reporter finally, a little good news, lets hear from the brands after hours. A number doing well, pvh, they serve Tommy Hilfiger. Above the streets estimates. Thats the ceo calling out a volatile economic macroenvironment he thinks will continue. Tommy hilfiger and the Heritage Brands and calvin klein showing in better than expected total revenues, there is a divergence in the comparable sales for the main two brands. While calvin klein comps north American Brands fell 5 . Tommy till i hilfiger fell 4 in international comps fell 14 . Switching over to tiffany, this morning the company beat out profits t. Comparable sales disappointed there and fell in every regions but europe they pointed to europe and domestic shopper spending in the americas, which is a key region as well as a strong dollar as the negative drag when translating over those foreign shares. Tiffany shares have been up more than 20 this year. Court, thank you, back at headquarters. Karen, where do you want to go retail here . Pvh is very interesting. I dont think particularly high end. So it stand out this trend of european goods is very interesting. Its sales very strong there. North america continues to just be a drag. I dont know when that or if thats going to turn around. Thats interesting to me that you must be in europe to find any growth. You want to have growing exposure there. Stocks act crazy, interesting to me, also, he would raise guidance, why not sort of. Let it hang out. Let it hang out, exactly. You know, play conservative. This is very good earnings. They must feel pretty confident about the rest of the year. Courtney mentioned they were amiss, Advance Auto Parts was there. What do you mean, in light of the home de po dpang busters core . I think peanuts differ on this i think home de po is a Better Company and a stock. They trade roughly the same valuation. Maybe theyre starting to show this little valuation out. Tiffany surprised me. I thought the high end would hang in there. Going back to pvh real quick. Gross margins hung in there and beat what the street is looking for. 12. 5 forward earnings. Its not that crazy expensive a stock. So i do think there is more. And bror brands as opposed to being out for a quarter and get rid of thing. By the way, i think we agree more than you think. The problem is, they work towing oftentimes one catches up with the other. The problem with lowes they dont have a professional side. Because after that, home depot sprechs that. Pvh will be on mad money tonight 6 00 p. M. Eastern time. Its not all bad news in consumer land, by the way, check out fast food stocks, buffalo wild wild wings jumping 8 . Dominos up more than 3 . Mcdonalds and yums brands up more than a percent. Retails and auto are getting wrecked. izzo stocks reason a tear. Mcdonalds the second best performing stock by apple. Our fast food stocks, are they sucking up all of the consumer dollars . Apparently. The ones doing well, are doing it. We talked about panera long before things happened and looking to see what can happen with that company. Kudoba. We talked about mcdonalds, i say sell it. Disagree, they have absolutely turned the corner under this new leadership. I think this stock is headed to that 160. Turning the quarter means theyve gotten to the digital age. Theyre doing what starbucks is doing. Everything moved up on these catalysts, right . Now what . They have to get that menu right. There is still that line at mcdonalds, just like starbucks. It frustrates people. I think there is somewhere like 6. Go ahead. They are turning some corner. This is a company that had 28 billion in annual sales in 2013, expected to have basically 20 billion next year. What corner are they turning . They are getting their lunch eaten by a lot of other platforms. Ipads, ordering the big macs, the problem is the menu. Its not serving pancakes all day. I think you will continue to see this. Isnt is that what easter brooke is facing and addressing right now . Its putting lipstick on a pig to be honest. Oh. Having lunch its a record high, though . The guy, he changed the narrative. Im not coming out. That is great. Im saying the menu is on the wrong side of history. At least in north america, the way people will be eating the next couple decades. Would you short the stocks . Watch out, dont be shorting this thing. There are some guys rolling up to monstrous craze in there. We both saw that. Sometimes, let me tell you something, a mcdonalds cheeseburgerer. There sorry. I mean, really, never, ever, in my life. Right. Maybe a nugget. All right. Anyways, still ahead, even as the president is out of the country on his First International trip the ceo released the floor on the house, the Health Care Plan within the past hour. We will tell you what they found and what it can mean for tax reform. Im melissa lee, you are watching cnbc, first in Business World wide. In the meantime, heres what else is coming up on fast. Watch the stocks. That mae be true. It could mark a major opportunity with a group of surging stocks today. Well turn you on to profit . Plus, the future of electric cars is now. And it could spell the end of one major commodity as we know it. Well explain when fast mon