tv Fast Money CNBC July 23, 2019 5:00pm-6:00pm EDT
engagement are in focus, especially u.s. activity users which barely budged in two years. third, investors are watching for facebook's expense outlook as the company faces a range of regulatory challenges including the latest from the doj. back to you. >> thank you we are out of time here. that does it for "closing bell." >> "fast money" picks it up right now. "fast money" starts right now. live from the nasdaq market site overlooking new york city's time swear i'm million. tim seymour, karen finerman, marc tepper and guy adami are on the desk check out the after hour action. chipotle, snap and texas instruments on the move. we will break down the headlines for you. ups is upping the delivery game, what the company announced that could deliver big time for investors. to infinity and beyond, beyond meat hitting another record high in today's session can anything stop the stock? we are digging in. we begin with breaking news out of washington, the justice department launching a big probe
into big tech. let's get the de-tais with ylan moye. >> we have confirmed that the department of justice is announcing a broad antitrust review of big tech likely to include amazon, facebook, google and apple. in a statement, it was set that without the discipline of meaningful marketplace competition, digital platforms may act in ways not responsive to consumer demands. he went to say that the department's antitrust probe will explore these important issues the focus of the new inquiry will be whether companies reduced competition, siefld innovati stifled innovation or harmed consumers. the companies were forced to testify on capitol hill to defend themselves against allegations that they are monopolies just this afternoon the congressman leading the effort, david cicilline, criticized the answers as evasive, incomplete or misleading. now the justice department is launching its own review it is not officially an
investigation of any single company but it could lead to that back to you. >> ylan, you know, a couple of months back or maybe a month ago we heard news that they were divvying what we cull big technology this specific release though says dominant online platforms which leads you to think that apple may not be included in this group. >> well, it is unclear at this point. they don't name any specific company names in the release, but one thing that was decided on earlier, we thought, was who would have jurisdiction over these companies. these are big reviews, big companies, complex issues, and it seemed that the regulators had agreed to split that up. now this review appears to go beyond that and be bigger than that are there going to be turf battles that could perhaps jeopardize the speediness of these reviews and inquiries? we will certainly have to see. but clearly the department of justice now making this on the top of the agenda. >> all right ylan, thank you. ylan mui for us in washington. she will keep us updated
we are seeing declines across the board most sharply in facebook, amazon and alphabet, each down more than 1% guy adami, you are an investor in these names as many people out there are. how do you trade these what do you do >> the one that scares me the most -- well, it is scary number one for the three names you mentioned. it makes sense they're all down. it probably makes sense that apple i would imagine is down small if not unchanged but amazon end of earnings on the 26th, now with the headline you look where it topped out, look where it traded down to, look where it just retest evidence you say to yourself, am i playing in the deep end of the pool so i don't know if earnings will necessarily matter now for amazon, facebook and google. i still think facebook sets up well, but i mean these headlines -- and i'm going to try to read through the press release. its has to be a little frightening, right >> we were talking yesterday about how take trade headlines, amore foes, bad news headlines and you factor it into the stock. here we are hitting this
participate of the stock market. hough do you think about it? >> this will be irritating for a really long time, right? we don't know how -- we don't have much clarity except there's a more formalness to it, right the thing that i hate about investigations like this, they go on and on they are a tremendous distraction, right so you need to staff up for it you need the attention of very senior people, plus i don't know how many additional people they will need. now they're all big companies and they can afford it, but the distraction of management time is a little -- that's unfortunate because, you know, this is what they do they don't do these kinds of projects so, you know, i think guy's already alluding to it i think earnings can be okay if they're good, and if they're bad, bad, right? >> right. >> so i think it sort of takes some of the upside away from good earnings. >> you draw this out to the worst case scenario, and that would be some breakup. >> is that the worst case? i don't know.
>> i don't know. i'm just thinking of one scenario there is an argument to be made you break up some of the companies and actually they might trade higher because you are unlocking sort of a pew play, you are unlocking value. all of a sudden parts of companies will trade as pure plays. >> although if you think about the part that is the engine of concern for ftc, doj, don't forget about the house judiciary committee, i don't know you can break up google search engine. i don't know that you can break up facebook's platform yes, you could break out instagram. you could break out youtube, and some of the parts i do think we would find this actually to be a very interesting exercise, especially for google and possibly for facebook. the only other thing i would say about this is very ironic that this is coming full bore from all sides. they figured out their lanes they're coming at it at a time when we're essentially fighting china's desire to build superpower national champions that will dominate the world like these companies have. >> and we're attacking our own. >> we are tearing down our
biggest and best companies at the time we are fighting this battle over global supremacy. >> it makes no sense. >> i think it is a lot of headline noise typically in the past these have been great opportunities to buy on the pull back there's no company-specific target right now quite frankly, i don't think there's much to do with regards to a breakup of amazon when i look at amazon, you know, the long-term thesis is still intact, right? this is a great company. you look at the high margin businesses like cloud and advertising that are growing like crazy, i still love amazon. >> by the way on the big full screen we were showing of all of the stocks we didn't have twitter up there twitter is a last move, down by 1.2% it may not be big in terms of size compared to the others, but in terms of what it does it has sort of a dominant position in that, i mean, nobody else does what they do. >> yes, i understand maybe twitter's collateral damage in this i wouldn't lump them in. i mean, look, we can say it right now. you mentioned the three companies and absolutely the
three companies that are clearly in the crosshairs for a number of different reasons, many of which tim alluded to, are facebook, amazon and alphabet. those are the ones you have to be concerned about if there's ancillary damage to a twitter, that's to me an opportunity. but i understand what mark is saying but, you know, this is pretty draconian headline. you got to read through some of this stuff but to karen's point, this doesn't end in a day. >> right. >> this lasts for quite sometime. >> for more on this let's bring in gene munster of loupe he joins us on the fast line what do you think of the news? >> the truth will lie several layers behind what the headlines are. i had some flashbacks to may 5th when the trade war escalated, the tensions escalated to china and we tried to extrapolate some of it to apple and it took months to figure it out. i think it is similar here we need to step back and look at
the anchoring theme of them. the first is privacy is important. second is this concept of antitrust. the third is consumers need to be better off. those three are difficult to get to balance i think for regulators to try to balance all three of those is going to be difficult to have any significant changes on these companies. absolutely agree, facebook and google are the prime targets here apple, even though it trades at a discounted multiple, it is a company that has the least risk here but if i was going to guess how this plays out, it does have a nominal negative impact on the multiples of google and facebook over the next several months, and i suspect that ultimately there's some changes in terms of how privacy is shared. but i just want to emphasize one last piece here on that consumer's better off component, is that's hard to pull off consumers love free products like instagram and google search the question is will regulators
want to break some of these up or further regulate them that may cause fees or more advertising around that. i suspect that will be a difficult hurdle to bring all three of these together. >> so just to take facebook as an example, since we are expecting facebook earnings after the bell, it is in focus it had a huge run up this year so far, more than 50%. if you think about that, do you think an ongoing investigation like this could hamper efforts for facebook to ramp up monetization of some of the other platforms? >> absolutely. i think you need to look at judiciously and i think facebook and google, something about how they display their search results, but those two are the most obvious ones. i think most investors, that will have a negative impact on the multiple now, the results tomorrow are going to have a bigger near-term impact, but undoubtedly this will be, as i think karen was talking about, a hang -- an
overhang on these shares for months to come >> so if we are to think that monetization of what is happening in instagram, for instance, is pulled back or at a stand pull, and maybe the rollout of libra given the backlash it has faced, is delayed, what kind of discount do you put on facebook that had been banking on all of these things happening at some point in the future? >> i think when you put it all together, if they cannot pull off -- or better said, if they can't accelerate some of the other monetizations that you outlined, and the multiples should go from 21 times next year to closer to 10 to 15 times. so i think it can have a material negative. i want to be most clear. this isn't going to happen overnight, but it is if that would be, i think, the one end of things don't tell out well for facebook, how that would play out in terms of stocks. >> which company would be the
most damaged in your view or is the most vulnerable do you think? >> yes, undoubtedly facebook i mean that -- if i had ten points to distribute who is at most risk here, i would give five of them to facebook, three of them to google, and two of them to amazon and zero to apple. i think there's no risk to apple. >> all right gene, thanks so much for phoning in we appreciate it >> thank you >> gene munster of loup ventures, giving us his analysis on this. karen, you are a facebook shareholder, apple hareholder. >> yes. >> what do you think of gene's evaluation of risk. >> i love that, that the multiple would be cut in half? >> basically. >> it seems a little much, but there's a lot of money to lose between here and there i don't know i have to think about this and do a -- so two separate things we have earnings and then we have this. which is bigger at the moment? well, earnings i think just for the very short term. >> all right >> we kind of had this conversation in our good, bad
and ugly yesterday because these were the names so if i look at facebook, the other thing that looks -- from my understanding, june 3rd was the day that we had the shot to the bow on these names you had facebook down 7.5% google, 6.3% since that low -- by the way, the low was a market bottom. it was a dramatic moment for the market when we had that bad news market has gone on to set new highs, just know that, in terms of how the market could respond to news like this. i realize it is the second or third shot facebook is up 36% from that point, google 10%. we can tell who is suffering under the weight of not only their own issues, but i think a bigger regulatory if thathassle that's a term we can use facebook with that kind of move into earnings, with two big bright lights on them in terms of libre coins and antitrust, facebook i would stay away from. >> mark?
>> i think a lot is headline noise, headline risk that could compress the multiples a little bit over the short run, but these are things that take years to play out in court these are still solid companies. i would still be buying them i think earnings are more important right now. that's what i'm focusing on. >> i hope earnings -- i hope he is right i hope earnings are more fact. i think the fact it will take such a long time, it casts a bit of a shadow for a while. look, it is about figuring out what the opportunity is. to tim's point, the stocks had tremendous runs, at least amazon and facebook you look at amazon, into earnings now, you have to wonder, do you want to try to play it from the long side into earnings with this headline risk out there. it is interesting, quickly gene said facebook's five points out of ten which i sort of get, but you talk about stifling competition. i mean that's been -- >> amazon, that's their game. >> -- for a long, long time and it is one of the lead lines i'm reading in the doj headline. >> plus there's the political, bezos. >> no question. >> you can't think of this administration who went after at&t time warner when it was a
loser there's another element here. >> yes coming up, chipotle, snap, visa all on the move in after hours. their conference calls getting started. we will break down the headlines straight ahead texas instrument, the stock hitting a new high after hitting a blowout quarter. back now with two more parts of the market that are ready for take breakout. we're live from times square in new york city, much more "fast money" right after this. xfinity mobile is a wireless network
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♪ welcome back to "fast money" a number of earnings movers after hours. we have chipotle, snap and visa, but one of the biggest movers is texas instruments. let's get to josh lipton with the latest on the results. >> i checked in with chris roland here is his take on the quarter. he said there was pent-up fear heading in, but said gross margins were better than expected at 64.3%. q3 guidance he acknowledges a bit below the streets estimates but better than feared it is the first earnings season and he says a decent report. on the call, interesting, executives giving some historical perspective here. they note they just completed their third quarter of
year-on-year declines and say cycles are always different, but typically you would see four to five quarters of such year-on-year declines before growth resumes they're not trying to forecast the cycle but offer historical perspective there. they were asked directly about huawei on the call and they know that huawei represents about 3% of revenuove overall for the pat quarter. they resumed shipments of products for things under compliance they were asked about 5g and said they saw nice growth in 5g products of course, t. >> what do you make of that? >> operating margins came in a little over 41%. the street was looking for 38.8%. that's encouraging now, the problem is in my opinion, if you really look, year over year revenue is down, depending on what you look anna log down 12%. embedded processing, down 21%.
again, the street didn't care with micron, clearly doesn't care here. the good news is operating margin is higher the bad news, the guide wasn't great. the other thing that concerned me is this isn't cheap at close to 21.5 times forward earnings that said, everybody seems to be in love with the semis right now. i'm not sure the negative stuff matters. >> the read from texas could be valuable. >> think it is very valuable remember, texan was the grim reaper on the last one. >> last quarter. >> yeah. and we were talking about, we were all in the dark on what you were supposed to be doing in the semi conductor space there was one report that really sent the pall over the entire sector it was this one the guide was a little better than expected. the street expected 138, midrange of where the new guidance has, yet 142. it has to be encouraging vis-a-vis where these guys were. let's wait and get more news out
of the postscript, but i think it is positive. >> next guest called the chip rip in leigh may and now back to tell us where the semis are heading from here. plus two more areas of the market primed for a breakout time to go off the charts with chris verrone. what are you looking at? >> let's start with the chips. i think what is most notable about the semi, this is the stocks, basically had 18 months of stefan hototal indifference you started to flirt with new highs in march and april, back to support in the 200, and the ricochet off support to new highs here i think it speaks to the fact it is still a secular market in chip stocks. when you look under the surface, what we like in particular 100% of chips above the 200-day moving average the internals are still very firm it reminds us a little bit of the breakout we saw from the chips out of the 2014, 2015, 2016 lull where they broke out and went on for another two
years. what else has these characteristics of an improving group, maybe at a consensus and brings us to the trucks. this has been one of the areas the market the street has been negative on over the last couple of years we actually see reasons for improvement here these are the trucks, slowly starting to make higher lows when you look internally, again, you have about 80% of trucks actually back above their 200-day average. that's the highest reading we have seen in almost two years. so the internal setup here is getting better so chips, good trucks, improving. i would put banks on this list or at least start to entertain the idea these banks are starting to improve. what has been so notable to us over the last number of weeks, even as bond yields took that last leg lower at about 2%, the financials have quietly started to outperform. over the last four weeks, banks have outperformed the utes by 800 basis points despite lower yields, a better tone, chips, trucks, banks, we think that's the new leadership starting to show up here
>> chris, why don't you come back over here to the desk jonah with bring a chair over, as he does so well. >> great job. >> thank you, jonah. >> sure. >> hey, chris. what's going on? >> chris, this is really good of these are indicators, right, for the overall markets, chips, trucking, banks? >> banks, come on. >> i think it is more of a reflection that after four, five, six months of some pretty tepid leadership, the fabric of this market is starting to change a little bit. now, we can't say that utes working and staples working was bearish because the market was up 17% in first half of the year my point is it is just changing where you are getting paid what was once defensive is becoming more pro risk i think ultimately it is a good thing. it is not just distinct to the u.s. we are seeing it in europe and in em. subtly, the more pro risk or cyclical groups are starting to take some share here. >> these go higher what happens to technology >> one of the relationships we always look at for message on
si cyclical are semis versus software that started to inflict over the last couple of weeks, i think software is ultimately fine, but it is rich and overbought and semis are reaction sell rating out of the base. i think in terms of playing cyclicality i think you will get more bang for your buck owning se semis over software. >> what are your breakouts >> you could push this up to 151, 160 i would encourage you to look at asml, globe bellwether kla ten core these are good stock that spent 18 months of indifference, now resolving higher. >> looking at ones that have been indifferent or bad. >> yes. >> what do you think of the industrials? >> you know what i think what's gone underappreciated over the last couple of weeks, back to the old highs. caterpillar has a better tone about it you are seeing it with the trucks as well some of the modest turns the airlines have broken out it is hard for us to be too negative when the pie of what is working seems to be getting
better i'm not sure industrials are leadership yet, but when the laggards have leap stock going down it is a better framework than alternative we like the group here. >> did you notice, guy, the chip stocks that chris likes and the semi conductor, the big base, the longer the base -- >> he is a disciple of the great luiz yamada. >> the longer the base, the higher in space. >> spinal tap song kudos to chris for that question tech absolutely has broken out above 119. i don't know if it gets to 150, but clearly people loving this report quickly, the airlines make sense. i know tim care rkaron talked at this, delta up on a decent day but an impressive performance. >> if you look at the bank moves, that's been under appreciated. these things are under appreciated. goldman sachs, waking up for the first time in two years. there's money there.
>> chris verrone, good to see you. >> thank you. >> you were noting the breakout, kbe up 1%. >> i was looking at the money centers. nice to see them break up. i thought i heard you say, i love jamie diamond. >> i think that was you. >> i might have said it. i will hang on to him. >> on deck, earnings triple play we are talking big bucks, burritos and bit moji. later, we are counting down to facebook's big report. what can you expect from the tech giant after tomorrow's close? stick with us. you are watching "fast money" on cnbc we will be back after this quick break. ♪
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welcome back to "fast money" it is time for earnings. ship poetly, snap and visa on the move after reporting we will kick things off with julia boorstin with the latest from snap's conference call. julia. >> well, melissa, the ceo says changes they have made are working to drive growth in users and revenue. he says they have laid the ground work for that momentum to continue. >> a redesigned application helps new snapchaters adopt retentive behaviors like talking to real friends or rebuild android application provides a better experience. we have accel brated revenue growth supporting a growing community around the world. >> snap guiding for better than expected results in the third quarter including as much as an 11% year-over-year user increase that's a faster rate than snap reported this quarter. now, one source of that
confidence is snap's investment in content >> as a result of our investments in our content platform, total daily time spent by snapchaters increased by 60% year over year while the number of daily viewers has grown by 35% year over year this was driven by the additional content we added to our platform over the past year as well as changes we made to our platform to prioritize depth of engagement. >> snap's big moves today, remember it all gained 5% during the market day this is all in sharp contrast to larger rival facebook as well as the other giants moving lower on the report of a new doj antitrust probe. snap says in the u.s. it has more 13 to 34-year-old users than facebook or instagram so right now snap is looking like a better option, even though it is much smaller. back over to you. >> julia, thank you. julia boorstin on snap up 11% after hours it is up 170% year-to-date if some of the other big
competitors are a little stymied by this doj investigation, maybe snap's business looks even better, mark. >> i mean it is up, what, 10%, 11% after hours, so they're doing something right. now, i have bon wroeen wrong on one. i haven't been in it, still don't like it and i would pass it they're struggling to attract the 34-plus crowd, the krod with the deep pockets until they are able to attract that crowd i will sit on the sidelines. i would rather be on a company like twitter where i feel engagement is elevated at least until the presidential election next year. >> this goes higher from here, stays higher >> i think so. we talked about this a lot, dan nathan, kudos to him tim's favorite thing -- >> average revenue per user, whatever you need. >> the more you know, the rainbow. >> they came in better than expected you know, daily average users -- >> thank you. >> let that play isn't it beautiful play it on the piano, by the way. >> sure. >> anyway, the metrics are good. the people probably continue to
chase the name so, yes, it is up 11%. i think it can go higher from here. >> the one thing i would say is the obvious, which is, first of all, short interest has come down it has been cut in half. kind of the easy run back into the market for people, you have actually seen year over year ad growth, that's great their new lens and gender blender, so they're attracting the right audience as discussed. but at 15 bucks, there's a fair amount of resistance for the stock that goes way back you know, there's no way i can like it when i didn't like it before because i don't think anything has changed dramatically here, even if the competition may be under more pressure. >> next up, visa that stock edging lower in the after hours session. let's get to deidre bosa with the results. >> melissa, those hit a fresh all-time high but trading down half a percent lisa ellis at move fat nathanson said the reason it changed course was that payment volume growth was softer than expected. darrell peller, wolf research, says, look, expectations were so
high it will trade up higher visa is up it is move beyond traditional card payments and into wallets t ceo said that visa is extending the partnership with morgan chase until 2029 he suggested that deal signings in europe is up. that should be positive for the company. lisa ellis is looking for color on visa direct, the new push payment product powering services like venmo and huber driver cashouts. she say it is a big future growth driver. darryn peller is looking for july spending and cross border trends, pricing opportunities and incremental partnerships in developing markets bon analysts, lisa and darren, said it is still early days, don't expect executives to say much on the call back to you. >> thank you, deidre bosa. karen, thoughts?
>> i am long mastercard so it will be similar dynamics i think they're both priced for maybe not perfection but a lot of really great things those things are happening, so i think in an okay tape it will be fine mastercard seems to have a little more momentum recently, cross border important for them as well. i would hang on to either one. >> yes tim? >> it is hard to argue with karen's argument on the valuation. it is just, you know, but the valuation for the last couple of quarters has been something that people tend to look past visa direct, other online -- kind of electronic in -- in essentially e payment solutions, put these guys in with some of the most innovative companies in the world right now in an exciting space so the multiple increase is explainable and i'm not sure we know what multiple. >> would you rather, guy >> i like this game. >> can you play this >> it is not a -- thank you for the graphic. it is a would you rather. >> we don't have the pick your poison graphic. >> it is not ready it is under wraps.
>> i can't wait for it. >> visa or square? >> wow. >> you weren't expecting that. >> you were thinking visa, mastercard. >> yeah. i think there's -- the growth opportunity is clearly better in square, so i'll say square although i will say this quickly. 30 times multiple for visa in this environment is a little bit rich, which also concerns me, which is why i would go square times two. >> hold on can i push -- i mean where is square's valuation explain -- >> it is a different ball game a completely different -- >> if you are concerned about valuation, default to the stratosphere. >> yes. >> absolutely could be right. >> visa doesn't have -- i mean snap is still a growth company visa is no longer a growth company. >> it is a growth company. >> not nearly like they were at 30 times, i think that's probably why -- it is down small in the after market, but the one thing that would maybe concern me, usually they beat on operating margins. this is first time in a while i have seen this actually miss
not but a lot but they missed. >> let's get to chipotle hitting all-time hice in the after hours. kate rogers back at headquarters where the details. kate. >> that's right. talking about kay is a deya's, a lot of things straight ahead chipotle, for the second quarter they beat on every metric. same-store sales up 10% but investor focus will be on digital once again here is ceo brian nicholl on digital sales. >> digital sales grew year over year to $262 million during the quarter and represented 18.2% of sales. to put it in perspective, it was more than we did in digital sales during all of 2016 delivery remains a key driver of digital growth given enhanced capabilities on app and website as well as expanded reach. in fact, delivery is now available for more than 95% of our restaurants and remains highly incremental. >> delivery also remains the fastest growing part of the
business chipotle rewards its loyalty program, launched in march, now it has 5 million members, up from 3 million last quarter. niccol said they're starting to use customer data, and said early results are showing members increase frequency after joining the program. he talked about layering to digital initiatives, now rewards, and said they have room to run when it comes to growth the company increased guidance for comps to high single digits for the full year. the sfok is up 70% year-to-date and up more than 130% since he took over as ceo last march. lots of questions from analysts on the call about how long the digital growth can sustain, but executives maintain they're in early days back to you. >> when they use the customer data to better target customers, what do they target the customers with are they discounts, offer, what are they doing >> there was teasing going back and forth between analysts on the call and who has gotten some of the offers, i think that's the plan they are gathering data who who is using it and then they can
target them with things like maybe a discount or offer along those lines. once again he said it is early days they're learning about the customers, how they visit the store and target them appropriately. >> so nachos, carne asada. >> yes they have that test kitchen i have been to in new york city, and i think the items are coming down in line they tend to put them out in the test kitchen and see how the customers react. >> we look forward to it kate rogers on chipotle. i cannot wait to do a taste test, we haven't done it in a long time. >> i will nail this one. >> for joe, those things come out. we will put them to the test how do we trade chipotle >> i would pass on chipotle. i think there's a lot of execution risk here. this thing is really expensive it is priced for perfection. i would rather be in a company like grubhub, right? you're taking advantage of food delivery which is big. grubhub, it is a stock that's been cut in half it is 50% off its all-time high. but you saw the same thing happen in 2015 when they were entering new markets
it was weighing on margins as soon as the new orders started to flow in, the stock snapped back i see the same thing happening with grubhub so i would rather be there. >> any concern about the investigations by the new york city counsellors into its practices chartering small businesses >> yes, it is something we are keeping an eye on. we saw a little pull back in the greater new york area, but it seems to be constrained to just new york so it is something worth keeping an eyeball on, but you are talking about a stock 50% off its high so a lot of upside here. >> here is one thing about chipotle even with 110 pe, again, terribly wrong in terms of my view on the stock for the last 300 bucks brian niccols has done a great job. the comps right now are still well ahead of the street, and that means the street has to at least be upgrading where they are for the company. has the market price set in? yes, but there's no question to me, the investment in digital has come with a cost and it seems like it is winning, or at least certainly the market is willing to reward the 18%.
>> extra chicken, no beans >> extra chicken, no beans. >> no beans, i just said that. >> 100%, and medium sauce i don't like the hot sauce when i go to chipotle, that's what i get. >> can i ask an existential question, is a burrito without beans really a burrito >> 100%. >> i'm not sure. >> what are you talking about? >> that's kim's information. >> what today a burrito blowout? >> i would say it is a blowout. >> tim mentioned the streets behind it, and we mentioned her a couple of quarters ago when people get it wrong, we crush them when people get it right we have to give props. nicole regan ofpiper jeffries had this one called. to tim's point a lot of us were backwards on this and a lot of us on our desk have as well, but she has done a great job with that said, comps were fantastic. >> unbelievable. >> this stock can be higher. comps were great and margins were great it is a good story. >> the thing that's interesting to me, the delivery part you mentioned, uber eats, uber has
put some of their future in uber eats and we see how important it is to chipotle, we see mcdonald's maybe there's something to it. it doesn't mean i went out and buy uber, but there's definitely something happening here. >> speaking of food, beyond insane beyond meat hitting another record high in today's session we will break down staggering stats in tin credibhis incredibn when "fast money" returns. ♪ prevagen is the number one pharmacist recommended memory support brand. you can find it in the vitamin aisle in stores everywhere. prevagen. healthier brain. better life. i had a few good tricks to help hide my bladder leak pad. like the old "tunic tug". but always discreet is less bulky. and it really protects. 'cause it turns liquid to gel. so i have nothing to hide.
welcome balk to "fast money" i'm million. beyond meat's unbelievable rally continuing today, the stock hitting another all-time high. shares of the plant-based meat company up now close to 700% since its may ipo. check this out it puts beyond meat's beyond $12 billion, making it bigger than under armour, macy's, jet blue, domino's and marathon oil. guy. >> july 29th they reported earnings this move in my opinion is people that tried to maybe short the stock, saying, you know what, we can't be short in earnings release let's cover. i mean karen could speak to the cost of borrowing the stock. fundamentally we can all have conversations with valuation clearly it doesn't matter. it is the addressable market that people are looking at maybe beyond meat will be the only fake meat company out there. with this said, you have to
believe competition is coming down at some point. >> karen >> it is such a dangerous game yes, i checked on the borrow today. no borrow. it used to be 300% now it is no borrow. so i mean this is just -- it has nothing to do with beyond meat anymore. it is just a technical ridiculousness. >> it is volkswagen/porsche. >> it is it is a squeeze. i believe in the change of how we eat, but this is -- it is in there already. >> or maybe -- >> by a lot. >> or maybe you don't believe in the change of how we eat. >> no, i don't $88 billion in revenue, $11 billion market cap it is insane the stock has a cult-like following. this is a stock, i don't want to eat this stuff i don't want to buy the stock, i don't want to short the stock. i mean it is a no-touch for me when you look at the nutritional content, is it any better than real beef? no, it probably isn't. actually, it might be worse when you look at it so, look, this is something that i would steer clear of. >> yeah. i have to echo thoughts that
have been expressed on valuation and also the competitive landscape is such that i don't understand -- >> price of the product, they're going to have their own product. >> yes by the way, is this company now basically equal to one-third of heinz kraft, you know, which is the biggest food company in the world? it is absurd to even think we are encroaching on this type of comparison so, no, i'm out. kudos to those who have been in, and i do think, you know, sometimes you letter winners run and you're long-term greedy. i think you are being greedy right now. >> up next, the delivery wars are heating up with u.p.s. making big plans to shake up the competition. we will tell you how to play the space. take a look at shares of snap soaring, but one trading is betting on a big break down r fo another social stock when it reports this week. don't go anywhere. much more "fast money" right after this
welcome back to "fast money" u.p.s. announcing it will begin delivering packages seven days a week let's get to frank holland back at headquarters with more. >> hey, melissa. that seven-day service starts on january 1st. fedex, remember, said it would do the same thing in may jack atkins from stevens says it is expected to capitalize on the
growing ecommerce motive adkins added that it will be attractive to ecommerce shippers b-to-been b-to-b is not growing as fast as ecommerce. the more density you build, the more profitable it becomes david bernstein a bit more skeptical. he said there's a perception in the market that margins have been under pressure with ecommerce and they had a hard time making six day work if they are challenged, it will add to the perception you are adding cobbs to adding cost to a business not great. last quarter, domestic ground revenues grew by 2.9% but next day revenues pefell by nearly 3.6% perhaps adding to the perception that david vernon was talking about, the company announcing a partnership with michael's craft stores, increasing the number of locations to 21,000 in the u.s. including cvs.
another announcement involves medical drone deliveries u.p.s. testing in north carolina the company says it applied for faa people to fly over people, at night too time and out of site of the operator it will focus on these medical deliveries through 2020. here is a stat to keep in mind to see how big the drone delivery market could be 52% of the 13 billion parcels shipped every year can actually fit in your mailbox. back over to you. >> thanks, frank frank holland at headquarters, u.p.s. beating fedex to a seven-day delivery we will play this game with two new candidates. >> pick me, pick me. >> tim, what do you think. ums or fedex >> on valuation it is a no brainer, it is fedex while we talked about fedex trading at a trough valuation at times that hasn't mattered, i think fedex has started to turn around what fedex priced this is a lot of international weakness and cyclicality that i don't think
u.p.s. has in their price. for me i think fedex is a better run company, why it usually trades at a premium and it does not now. >> do you think there's continued european weakness where fedex would have to incorporate the weak guidance going forward? >> i think fedex has been out front with it. in fact, the market at times has been disappointed because it was not what the quarter they were told before. in other words, fedex gave them a couple of quarters where it was, hold on a second. they were straight in your face about what was going on in europe. >> seven days, good for u.p.s. >> i don't know. we'll see. we'll see. >> what's the reservation? >> just, you know, i think frank talked about it, adding revenue without -- or are you adding, you know, not profitable revenue. >> right. >> that's the question i agree with tim on fedex. i like the valuation better. i think, you know, fedex, much of their troubles have been self-inflicted wounds and i do think they will get it together. i don't know when, but when they do i think it won't trade at
this discounted margin i am in both more in fedex than u.p.s. >> so the would you rather doesn't work with karen. >> yeah. >> because you're in both. tepper >> fedex as well so based on valuation, it is definitely cheerp and it seems u.p.s. is trying to play catch-up to fedex. fedex is in the lead right now but, you know, if the global economy is slowing, i would really rather not own either of these. i think right now amazon is really a big threat, especially if they decide to move more of their logistics in-house. >> i know you will bring up your stint at u.p.s. and you are wearing a brown costume with the brown socks pulled up to your knees. but what is your feeling here. >> to playdevil's advocate and because i have an affinity towards united parcel service. >> u.p.s. >> -- i will take ums. yes, i understand the valuation argument the technicians say a major bottom from a low of 92 in 2016, recent low you are at a level now where if it can close above is 10 on the release tomorrow, it has broken out of a major down trend. u.p.s., mel, why not
i worked there and all of the guys and gals there loved me when i was there. >> how quickly in the spring did you break out the shorts >> i'm a february shorts guy, tim. >> okay. coming up, facebook shares lower in after hours after the doj launched a probe into big tech the company reports tomorrow we will break down what you can expect is the fund built to sell or built to last? etfs are only part of a portfolio. so make it easy to explain. give me a quality fund that helps me get clients closer to their goals. flexshares etfs are designed and managed around investor objectives. so you can advise with confidence. before investing, consider the fund's investment objectives, risks, charges and expenses. go to flexshares.com for a prospectus containing this information. read it carefully.
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big trouble for the social media giant when they report after the bell tomorrow. mike khouw has the details >> mike. >> facebook options are implying about a 6.5% move after reporting earnings, in line with the longer term average move after earnings of about 7% all though i would point out over the last four quarters it has moved considerably more, clos closer to 10% on average the largest trade we saw was a purchase of over 6,800 of the weekly puts. those traded for just under $0.50. ultimately, over 11,000 changed hands and that trade be would be targeting a move to the down side of 10% or more by the end of the week after they report. >> thanks for that for more "options action" tune in friday, 5:30 eastern time up next, final trades. "options action" is sponsored by -
♪ time for the final trade tim? >> how about that new leadership in the market that is banks. how about bank of america which sits right in the middle of citi bank and jp morgan. >> karen >> yes, some good news today out of stanley, black and decker and sherwin williams leads me to believe home depot will be good. i like home depot.
>> tepper. >> united technologies, another beat in raise in defense spending is one thing both parties can agree on. >> keith >> stealth rally in blackstone there, melissa before we get, milk duds are the most underrated candy. >> hold them up. >> right there. >> that does it my mission is simple, to make you money i'm here to level the playing field for all investors. there's always a bull market somewhere and i promise to help you find it. "mad money" starts now hey, i'm cramer. welcome to "mad money. well cop come to cramerica. other people want to make friends. i'm trying to make you money hi my job is to educate, teach and put in context call me or tweet me @jimcramer