tv Fast Money CNBC August 19, 2014 5:00pm-6:01pm EDT
and "shark tank" are coming up. it is "shark tank" tuesday. sarah eisen, what's up, what's on tap? >> we got traders worked up about apple at the highest levels since september 21st, 2012. they say its very significant. we have one that will be short. we'll see if he will be covering that short tonight, kelly. >> i think i know who that is. over to you guys. >> thanks very much. "fast money" starts right now in new york's time's square, i'm sarah eisen in today for melissa lee. tim seymour, dan nathan and guy adami are traders in tonight. home depot shares soaring today of posting strong earning, raising its forecast for the year. that was after strong home builder confidence numbers came out yesterday and a strong number for housing starts this morning. so is the housing market officially recovered, mr. beaks? >> it learnly looks like it. there is only one month data but
we had that spring slump that had everybody concerned. i think the moves today in housing and home depot were because everybody thought perhaps housing was slowing. most of wall street was saying, yeah, it's over. today that surprised people. so we had a 5% move in home depot today, following that through, houseing is a huge, huge, part of the commitment you have to start thinking, is the economy actually going to improve in the second half and, if so, bonds are probably mispriced. >> not a significant part of the economy. you also got the wealth fact as home values go up, prices go up, people theoretically should spend more. >> if you get easing credit standards, i think this is the biggest part. i don't know if we need the economy to do something substantial in the second half. what is interesting, you bought the the auto sector basically back at bubble territory if you look at 2006 and '07 where the housing market is not. this bodes well for home depot and lowe, they get the more resilience and the wealth
effect, and, ultimately, is bearing the retale sector under some pressure. i think these guys can outperform and the housing sector gets a big boost from easing credit standards, especially in prime, which is not a place you should be that concerned about. >> what do you think, guy, a game changer? i want to know, permits were up 1.8%. that was a good gauge. >> it was a great choice by our crack staff. i don't think the housing market. >> don't come aknocking. >> is rocking. >> donned d and don't come knocking, by the way. it's bouncing off what was a ridiculous low. it's recovering, recovering at a really slow pace. what we talked about last night, we talked about for years the fact that this housing market lends itself to exactly what home depot does. you saw it in their quarter. can you chase it here up 5.5%? probably no. we have been steadfast on this name. that to me is the only way to play this market. >> sam's or lowes? >> i think home depot is a better company. i think it's a better company.
>> i think you play it by single stocks. i think that was an underperforming sector or etf for a better part of this year. i think in a lot of ways it was zeefbing. if you looked at a lot of the components, beth, bath, beyond, lumber liquidators, were doing boarly t. data is one month's data. i don't think it makes a trend, if you look at that shp chart, it's a reversion trade. it's back to the mid-point of the ring. i don't think this is anything you go casing right here. i think it's stock specific. the situation with the home depot, it was a beautiful breakout. >> that stock can be basing four year between 74 and 84. it was under performing the s&p. in one fell swoop, it just got back into line with the s&p and made a beautiful breakout. >> home depot and loees for the last three months outperformed. i here what you are saying. i don't think these are stocks that woke up out of nowhere. i think lowes going to surprise tomorrow. it's starting to narrow the comp gap to home depot.
i think this is a stock you can play. >> just to speak broadly to the economy. this is what we have been seeing, right, better check data? better earnings, for the most part, revenue growth. >> that is the bold case. >> what about crude oil? are you going to see that? >> it doesn't speak to a booming economy. >> there's a lot of supply coming out. >> it's a global story, though, isn't it? global demand. >> let's look at bond yields. >> you don't have to have a booming economy to have the stockmarket go higher. it could stay exactly leak it is. as long as companies can financially engineer, as long as there is buybacks and mergers, the stockmarket continues to go higher. >> no interest rates, no inflation. >> people forget technically, if you do valuation, without getting too wonky on this, the valuation should be a lot higher if your interest rate and cost of capital is zero. it is zero. these guy versus huge free catch flow rates. back to home depot and lowes, 7,
8, free cash yield lows, that's good. >> stock starting to break out here, apple shares surpassing the $1 00 mark closing at a post-flip high. will power follows apple for baird. he has a $105 price perform target. are you looking to raise your price target after we seen this kind of momentum? >> sarah, that's a good question. i don't think we have immediate plans to do that. we like the momentum. it is a bit of deja vu. needless to say, it's been quite a ride over the last years. not to be a naysayer, if you look at the buy backs they have done over the last couple years the market cap isn't what it was when it hit $700 pre-slit. nevertheless, $700 is a nice milestone. >> obviously, all eyes on september. the new refresh of phone iphone 6. last year an him sold 9 million iphones in the first weekend. do you expect it to top that, go
to record say 10 million over the first weekend? >> oh, absolutely. okay. some of this will hinge on what supply looks like and they become available. we think, of course the launch announcement will be september 9th and patterns hold, it will gone sale a week and a half or so thereafter. but, no, i think it will be a disappointment. they couldn't top that number, assuming that i have adequate supply. you think about the december quarter, which is really the big quarter for sales. last year, they sold 51 million. i think we on the street are looking close to 60 million. >> that will be 15% unit growth. that's a very healthy number if they can speak to that. >> i think one of brian's points is you priced in the iphone 6. i think it's more steve milanovich talks about the creepy ecosystem. basically, you are going from the car to the home to wherever. in is the next powerful story in the immediate term. we know it's going on in the fall. what is your view on this?
>> i think this price in fairness look everybody has been hypeing iphone 6 for some time. i think on that product alone you have the potential to sell the news event. i think the key for the stock is going to be innovation, which of course we all talked about for many years now. what other kind of products and services can they deliver? do we see the iwatch? can that be a needle mover or is that about pulling in the ecosystem. i think it's probably the latter. the services department, do they introduce mobile payments? what else can they do in that area to extend their ecosystem advantages? >> i know you are certainly bullish on this stock. you have been right. thanks, for joining us, will power, robert w. baird. bk you recently did short ap wela stock at 10 12k3w4r i am getting ready to cover that short. my view was exactly what tim said, we've priced in all this good news. there's probably something coming in the future, but we don't know it. i don't think they have the
innovators that they had, in particular, obviously, steve jobs, but the market completely disagrees with me. i shorted it. 25, 95 was my average price. 101 is my stop. you'll be out and i'll be wrong. >> i think the enthusiasm of the iphone 5 stock in 2012, expectations got very, very high. it's not a valuation system. it's about innovation and what comes next. we don't know. since 2012, since that iphone 5 not owhole heck of a lot has come next. it's a lot of evolutionary products. i think you have to be confidence there will be the suite of services, wearables. >> and margins. i think mar jens. >> they've come down 5 percentage points. earnings in 2012 were about 630 at the end of that fiscal year. have you the stock right back to where it was before. when you think about it, it's not a layup anymore. carl icahn tweeted it was a
layup when he tweeted a year ago. >> there is no layups anyway, if you look at apple, you are buying a very good valuation. if it goes up 10%. it will be 25 and $30 in cash. this company is proven, there is an extremely loyal base. they're not losing anybody. more importantly. >> there is an extremely investor in this. >> on goggle, the ten-year anniversary, guess, what apple in that time, 4400%. >> it's not just home depot and apple that are breaking out. we have got our traders here taking a look at slew of names across all sectors that could be on the verge of a serious move higher. let's go around the horn and get some top picks, tim. >> emerging market equities have
been outperforming the s&ps the last six months. you are based on the eem. this is a stock pushed up against. i think we are ready to break through major resistance back 16 months. if you believe china is worried, we will talk about this, you need china to rally emerging markets, we're waiting. emerging is breaking out. if you look at the three-year charts, this is aid tra could go on 18 months because of how much it underperforms. >> dan. >> nike is one that technically resembled a lot of home depot. it spent the better part of the last year in a range here between 70, 80. it's up into the higher bart of that range here. there is issues when you look at the peers, not under armour, this is one that seems to be setting up for the next positive catalyst for a breakout similar like we saw in home depot and the catalyst would be q1 earnings come late september. i set up the bullish options trade. i'm trying to sell some shorter
ones. >> they have been on a shot streak with earnings. b.k., how bad you? >> for me it's gold and gdx. maybe we talked about the economy getting stronger the most important question, is the fed going to tolerate a little higher inflation than props their target? keep rates low. if that is the case. then you could get a scenario where you get negative real interest rates. so rates stay low, inflation pops up. that's very positive for gold. gdx is up quite a bit. i think it will go higher. >> we seen big moves in bio techs. we talked about it from time to time stlachlt a fawn invasive co who rectal screening test which is state of the art. it's basically an intellectual property play. a lot of people are betting against it. you've seen what happened in these big short interest names. i think this company stands low itself on the shortage. i think it's a $25 name. >> not one we talk about too often. >> no. >> nice job, guy.
bye, bye, ballmer, former microsoft ceo steve ballmer is stepping down from the company, a few hours ago. so will the move clear way for a new ceo? talking making more changes. plus, one analyst making a bold call that could get the attention of netflix shareholders. he'll be joining us live on "fast" coming up. [ music playing ]
. >> my favorite song. >> a down day. we're looking to chart sprint. the company is unveiling a new pricing plan that offers 20 gigabytes of shared data for up to ten lines plus unlimited talk and texting for $100 a month and it will also pay up to $350 when rivals switch, this is for new subscribers. >> i bought a little stock today. it trades horribly t. dead low, it's down 25% since they called off tear bid for t-mobile a couple weeks ago. this is a situation where it's bad for shareholders int near
term. this price war is going to be to all of our benefit. that being said, i think you have toly the about how t-mobile started aggressive pricing and take share from the incumbent carriers. they put themselves in a good position where a lot of people are interested to them. to me it sound bad and actually bad. remember, soft bank did this deal for them. i do not think this thing is going to be a doctor 2, $3 stock any time soon. i will probably buy a little more if it goes lower. i will keep tight stop on them. >> you were talking about this in the green room. do zru a differing been? >> i don't think it's a home run, i think there is an advantage that sprint got here. they've proven in the past they have innovative ideas that work. i don't think you get hurt too bad in this. i don't think it goes to 12. you might make a little on this. next up is microsoft, steve ballmer has resigned from microsoft's board, the
announcement comes after he made a headline grabbing debut as the new owner of the l.a. clippers, guy, if case you missed it. >> oh, there it is. >> it looks like he'll be taking them to the nbc. >> it's so awkward. it's so troubling. it is, there got to be people in the crowd saying who is this? >> that's got to be polite. >> chris paul has to be saying, you got to get me in the mix. >> chris paul is a point guard, sar remarks in case you were wondering. >> i was. >> he hit a home run in '07. >> that's right. >> we talked about it getting ahead of itself. i thought it would trade back down to 41. it didn't. i think it got to 42 and a quarter so a couple weeks ago now it feels like it wants to make the next short to $50 rick talks about. it's hard to dismiss what they have done the last couple quarters. it's hard to fade the stock.
>> the new ceo scott na della who already made his mark on this company is reforming. >> you have a couple things going on here, obviously, their new windows. have you the update on the xp. that's probably hitting 7 there. now have you an inno saitive company. plus you have a dividend stock on this i was actually long and sold it about 45-ish or so. i missed buying it again, i like guy thought it would pull back a bit. >> you said innovating, what itself going on there? >> they're going more towards mobile. >> mobile first cloud. >> they paid $1 billion for the cloud? >> you said 7th inning, chris paul is a basketball player. >> no sports. no sports. >> so is he in the penalty box? >> my only point is i haven't heard the word innovative with microsoft in a long time. >> he's more innovative than
ballmer. it could be priced in. i'm not long it. >> let's move on to a slew of retail earnings. good news, t.j. max reporting second quarter earnings rose on higher sales and heavy customer traffic while dick's sporting goods saw its comp store sales increase 3% coupled with a pretty strong earnings beat. >> golf peaked about six years ago and continues to go lower with all due respect. i think if you look at the bad boys here, urban outfitters, target, j.c. penney, urban announced numbers, stabilization, they beat on the top line. j.c. penny. >> that is the story of that story. target, everyone on the street downgraded after they kind of pre-guided the second quarter. the bar is so low across a number of these plays. practiceicout carts, j.c. penney is broken through key 89 level.
this on a cart basis looks interesting, i don't think the turn around in canada and the u.s. is any time soon. i bought j.c. penney early after those friday numbers. i thought they were good. stock traded down on those numbers, target is one that gears up as well. >> can you really trade retail as a group? there are so many winners as well. >> i agree, we talked about macy's when they sold off. we said when it sold 58 level, this stock will push towards the 61, 62 level. had a nice day today. michael kors had a nice bounce. >> nobody likes dick's sporting goods? >> no, not necessarily. i'll tell you the one thing you can get with them since golf is doing bad. calloway, ely, that looks terrible. >> i like dick's. >> you do? >> i think it's a universal stock. you have the opportunity, you know, if they have a turn around if golf, you will be fine. >> why are you smirking so much?
what is going on? >> we will leave it there. up next, grab your backpacks, tim seymour has a trade school lesson, cannot wait on why several chinese big cap stocks keep outperforming despite bad data. and later, if you can buy into an hbo stock, what might that mean for rival netflix? we're talking about the battle for original content and how you value that later on. [ male announcer ] don't just visit hawaii.
over 20 million kids everyday in oulack access to healthy food. for the first time american kids are slated to live a shorter life span than their parents. it's a problem that we can turn around and change. revolution foods is a company we started to provide access to healthy, affordable, kid-inspired, chef-crafted food. we looked at what are the aspects of food that will help set up kids for success? making sure foods are made with high quality ingredients and prepared fresh everyday. our collaboration with citi has helped us really accelerate the expansion of our business in terms of how many communities we can serve. working with citi has also helped to fuel our innovation process and the speed at which we can bring new products into the grocery stores. we are employing 1,000 people across 27 urban areas and today, serve over 1 million meals a week. until every kid has built those life-long eating habits, we'll keep working.
i make a lot of purchases foand i get ass. lot in return with ink plus from chase. like 50,000 bonus points when i spent $5,000 in the first 3 months after i opened my account. and i earn 5 times the rewards on internet, phone services and at office supply stores. with ink plus i can choose how to redeem my points. travel, gift cards, even cash back. and my rewards points won't expire. so you can make owning a business even more rewarding. ink from chase. so you can.
. >> all right, let's get an earnings alert. >> top boyz in the hood over here, sorry. >> following la-z boy trading lower in the after hours. >> this is after the company reported first quarter operating earnings of $20 per share. revenue coming in higher than street forecast. if you lad to pick one or the other, that's what you'd want. the company said we increased stock buyback. this stock is currently trading down more than 5%. sar remarks back to you. >> yeah, we will trade it right now. thanks, very much, courtney. guy. >> call me crazy. i think actually you can own on this dip. this stock sold off considerably. it does not trade at a ridiculous valuation. you would think it's a high short. it's really not. i think if this thing holds at 21 and that 22 level on big volume, what you will see tomorrow. i think you buy it for a trade.
this, you know, dan was making fun of beaks before. we talked about it in a break. he said this is perfect. >> have you ever sat in one of those, though? those things are unbelievably comfortable. >> she a la-z boy. >> no, he's not. he's doing another triathlon on sunday, that itself two in like a month. >> the mini ones. trade school on china. in the past six months, china's equities have been outperforming despite some negative trends in the economy. tim says it's behind the credit and macro-issues have been wrong for some time now. part of it is that mini stimulus? >> it's been a self stimulus. there has been so many dooms sayres, people say you need a little consumption change like in online retail or technology or a place like china mobile, which is a big stake company that has been inefficient in years. a little change means a lot of valuation for the largest cell
phone companies. when we talk chosen, every month for the last six months, we have been looking at housing prices in china. people are pointing to a credit issue which is largely i think we know china has a credit issue. chosen has more ability to paper over these problems. can you see the outperformance of the shanghai cop, it's up 12% over the last three months. look at the s&p, in fact, we talked about emerging breaking out. here's a chart of the fxi and the eem and vs. the s&p. again we see emerging markets are outperforming. carolina is outperforming everything. for emerging to rally. you need china to be at the forefront of that. finally if you look at the score names we talked a lot about on the show how the internet names, baidu which trades 30 times, it's given you 60% top line growth. also, china money. look at the move over the last couple days, that es are all big cap names. so again, i'm not asking to you reach out the credit curve or reach out the liquidity curve.
we're talking names that finally coin mobile is seeing investment in 3 g and 4 g pay off. we know the apple partnership at least for apple it was a big quarter. the petro china story is interesting. this is a company for years was subsidizing gas prices the government is finally running it like a big company. xfi, in the fall you have the mma the much malmarket accessibility of foreign investors into the local share market. it will be a catalyst. you will be sure of it. i think you should be buying china. trade school, do not pay attention to coin credit and necessarily say this market is going down. >> coin currenty, it's a five year high, they allow the currency to get a little stronger, that i have more faith in meeting their target. >> tim also mentioned the mma. that's also impacting the hong kong market. it's exposed to china. i with the ewh. you still get that china
exposure. it's causing quite a flow of money into hong kong and potentially you can get the hong kong dollar peg break. if that happens it will be good for ewh all these are priced in hong kong dollar. >> everybody has been wrong on that tried for a long time that peg break. >> but in this way you get to play that peg break plus you get exposure to china economy and exposure to hong kong. >> be sure to tune in next week when we go back to trade school. we'll be showing your videos and andering your questions live on air. that was a good taste of it. coming up, netflix ceo reed hastings have taken some serious jabs at hbo in the past. >> i guess the ceo of hbo doesn't mind sharing his account information. so it's -- his password is netflix. >> all right. after the break, we've got an
analyst who says time warner should create a trading stock for hbo. so what would that stock actually mean for netflix and the rivalry? that is next. edit card where the reward was that new car smell and the freedom of the open road? a card that gave you that "i'm 16 and just got my first car" feeling. presenting the buypower card from capital one. redeem earnings toward part or even all of a new chevrolet, buick, gmc or cadillac - with no limits. so every time you use it, you're not just shopping for goods. you're shopping for something great. learn more at buypowercard.com it's been that way since the day you met. but your erectile dysfunction - it could be a question of blood flow. cialis tadalafil for daily use helps you be ready anytime the moment's right. you can be more confident in your ability to be ready. and the same cialis is the only daily ed tablet approved to treat ed and symptoms of bph like needing to go frequently or urgently. tell your doctor about
all your medical conditions and medications, and ask if your heart is healthy enough for sexual activity. do not take cialis if you take nitrates for chest pain, as this may cause an unsafe drop in blood pressure. do not drink alcohol in excess with cialis. side effects may include headache, upset stomach, delayed backache or muscle ache. to avoid long-term injury, seek immediate medical help for an erection lasting more than 4 hours. if you have any sudden decrease or loss in hearing or vision, or if you have any allergic reactions such as rash, hives, swelling of the lips, tongue or throat, or difficulty breathing or swallowing, stop taking cialis and get medical help right away. ask your doctor about cialis for daily use and a 30-tablet free trial. the rivalry? did you know a ten-second test could help your business avoid hours of delay caused by slow internet from the phone company? that's enough time to record a memo. idea for sales giveaway. return a call.
sign a contract. pick a tie. take a break with mr. duck. practice up for the business trip. fly to florida. win an award. close a deal. hire an intern. and still have time to spare. go to comcastbusiness.com/ checkyourspeed if we can't offer faster speeds - or save you money - we'll give you $150. comcast business. built for business.
. >> welcome back to "fast money" live at the nasdaq market site. here is what is ahead on "fast money," hbo versus let in flicks. one an a list that could create a new battlegrounds for two rivals. hewlett packard reporting after the bell, why some are betting the point could disappoint. plus the mini crash flash, caught bk's eye and mine. we bond over it. there is your hint. that is coming up. we're going to start though with hbo whether it should trade under it's own symbol. one an a list says time warner could unlock value by offering an hbo tracking stock, but the content war intensifies. what would an hbo rival mean for netflix? let's bring in tony wible on the "fast" line, how would this work, an hbo tracking stock for some aanalysts for time warner? >> i think a tracking stock is
needed for so for fox than netflix. fox making a bid for time warner, i think the company is ultimately going to be under pressure to open up value and it's hard to do that in a traditional tv business and environment is kind of weak, fees are under these long-term deals. but if you opened up a skytracking stock for hbo one where the company time warner would retain assets and voting control, you basically get people to value it more on par with how netflix is being valued. there is this immense unlocked opportunity at hbo as everybody continues to speculate at some point they sell it more wage and resemble more of a netflix model. >> so what exactly would you value that hbo tracking stock at vs. what you see for net lix? >> i mean, there is actually two different ways you can go about it. one is valueing each subscriber, it's roughly doctor 500 a sub. in which case you get over a 35 million market cap on hbo.
however, i think a 15 times ebitda multiple is also reasonable. basically, either one of those approaches gets you about $35 the value for time warner share. so the residual part of time warner, the turner entertainment networks and warner brother studios, we think that's 60. you but those two together. you have something quickly overnight could be $95. you start to look at rupert murdock for time warner, you could justify why it was to low. >> i'm certain time warner is under pressure to bring that valuation up. back to hbo, you said 15 times ebitda, isn't netflix double that? >> when you talk about the world media, you have a cross section of an internet analyst and a traditional media analyst. i think he will have more traditional media guys more conservative looking at an hbo where you tend to have these internet comps more on netflix.
so there is a range, but again if you have you use a value subscriber that uses netflix on hbo you get an extra $5 billion of incrementation. >> so the values for hbo are a part of time wasn'ter earnings stream. why should this tracking stock have any value whatsoever? >> well, it's because there is under monetization of hbo. so today the hbo model works where you pay $15 to $20-plus depending on what cable or satellite operator you are working with. the satellite or cable operator keeps roughly half of. that if hbo were presumably to go wage instead of retaining $7 per month, they could retain an extra $5 on 40 million subscribers, abroad they have 80 million. the numbers add up quickly. >> they can do that under the time warner structure. >> the question is what value do they get? under time warner structure, you get a ten times ebitda
structure. if you carve that out, there is a real interest in types of mode els, the netflix suggests that people are looking at monetization opportunities around streaming. >> all right. well, it's certainly an interesting call. tony wible thank you for joining us to explain capital markets. guys, let's trade it, time warner vs. netflix or that hbo tracking stock? >> i am not a fan of tracking stocks. it's a financial engineering game. i get it. you carve it out, get different investors in there, it shouldn't have any more value. >> you are trying to say time warner is much more valuable? >> i mean, investors do their work. they do the sum of the parts. if you want to call it a time warner holding company, i totally agree we brian. at the same time i think time warner is interesting. they guided the second half, it will be difficult. the first half is up 27%. the full year guidance is low teens, i think they will be way ahead of it. if you say let's play tony's
game, hbo is worth a lot more. netflix is a sale. time warner is a buy. >> your thoughts, dan? >> i agree, i think tracking stock, it's cosmetic in a way. so if you did all of a sudden have a tracking stock and it looked like $35 billion then they deal look was i to low. on netflix i'm just a buyer here, back to our breakout thing if there was a stock that looks like it was going to breakout, i'm not a buyer. >> if you had to right here, time warner held exactly the level that we bounce from when the whole rupert murdock thing came out in the first place, traded down to that 72-and-a-half, 73 level, held and bounced. i think this is edited back to 85. i think tony has an $87 price target. that's right. netflix to dan's point right now, it feels leak it wants to make that push to 500 given the choice. >> time now for pops and drops, the big movers of the day. >> a lot of positive news in the
space. this bounce a solar bounce, if you have me to pick between the two, it's tsl. a quick note, yingling the beer the oldest owned family owned brewery in the uvenlths i went there. >> -- in the united states, i went there. >> you are a jerk, you didn't think of it. you should go out and get a yingling tonight, hashtag. >> el pollo loco trades 10%. >> stanley doesn't think you should, they downgraded today, cage out with negative words on it. i don't know, cale me crazy. i think around $28 it starts to look interesting. >> isn't it up like 100%? >> right. right. as long as it holds 28, i think you will be okay. >> a top for rack space topping 3%, dan. >> they put themselves up for sale. they hired a banker for alternatives. this was back in may. in the 13-f filings, two
activists, dan loe and wells fargo saying they could be buying up to million of stock back. you have activists pressing. you have wall street analysts suggesting there is a lot of positive catalyst for the thing. they're up for sale, more strategic analysts. something happens here, hughes the prior low. >> a drop for phb billitin dropping 10%. >> bhp thinks if they separate the gold, alluminum and silver assets, this is a better alternative. the stock dumps 3.5% today mostly on a buyback that's not happening. this was not the reason the sale of bhp. i would actually be buying global integrated minors. >> and a drop for justin bieber. dan nathan isn't the only one dissing the biebes. >> really? huh? he's talking about positive images, justin bieber is not a
positive image. this is not an app i would want my kid to have on the phone. he has his tattoos and a shirt looking like a goon. >> it turns out, you are not alone, dan, elizabeth arden began sluggish sales on celebrity fragrances singleing out svents as the key by justin bieber and also that lor swift. >> can you imagine what that stuff smells like? look at him. it must be horrendous. >> we received a lot of tweets and retweets within we had shots on, that selfie business that justin bibler is backing. so there are a lot of fans. >> taylor swift on the other hand is a fantastic role model. we should applaud her. >> would you buy her fragrance? >> i wouldn't buy her fragrance. >> elizabeth arden shares tumbled today. up next, google shareholders had a lot to share about over the last decade. it turns out there are ten s&p
is overpriced by as much as 10e% and based on 2004 cash flow he pegs the stock at $76 a share. >> i think the demand both from the nasdaq internet stocks jumbled a bit being weaker, frankly some of the things that have come out in the past weeks put a dmper on that. >> if they think thing to is around 100 and it's going for 85, they were leaving some money on the table for the selling shareholders and the company. >> i thought it was smooth and the trading has been orderly. certainly you don't see wild volatility in that stock. i'd have to agree with david certainly the opening looks quite successful, at least. >> the throwback today marks ten years when google officially went public. in the past decade there are five stocks in the s&p 500 able to outperform google. what do the high flyers have that google doesn't? let's bring in analyst howard
silverblat who has crunched the numbers as always, howard, talk about who is in theb top ten. we talked about apple that beat google. >> we know netflix, apple, obviously, you mentioned sales force, by the way, they've now moved up to number ten. they beat out western digital. so they are tenth on the list, there is nine more ahead of it with sales force being the next one that would have to bump, it was a long way off. i think a part of the item here also is ten years that google is now the third largest company in the index from nowhere. and it's knocking on the door to become number two. >> and what did you, did you analyze further any of the data in terms of earnings or dividends or what these other stocks had that google doesn't? for instance, google doesn't have an earnings. i know these other guys do. >> the earnings are not quite in the top ten anywhere. dividends is the largest non-paying dividends there. most of the companies on the top
ten do not pay a dividend. apple obviously recently started. but these companies are tech related and they're new to the market to some degree. a lot being ipos, itself, it's showing the speed at which a company can go from basically a start-up, a thought, an idea, to a major corporation. it's not like you have to be a steel company or order or a caterpillar where you need billions of dollars to build out with thousands of employees. >> howard, it's tim. thanks, for coming on. i guess i'm unclear as to the point here. is the point that google has been a value creator in ten years and no one can touch them or the question that this is a stock other companies seemingly are showing more growth and there is another way to go? >> no, their growth is definitely there. historically, they've been there. the point is they came from nowhere to get there and if they need just as we always discussed with apple, they need to protect that turf and go forward. ten years ago, again, if we go
back to apple the iphone wasn't even there. so we don't even know the products from here. google in order to maintain and grow is going to have to be innovative, smart and competitive. it is a different market now. it's not like say billions of dollars for coming to the market to compete. can you start up from the garage. >> yeah, i think that new concept theme is really the take away. thanks very much, good to see you, howard civil sper blat, ceo iq. you are the one that's actually long? >> i am long. this company is giving me 25 to 28% top line growth with a lot of innovation i think with a multiple south of 20 times. this is a company in 20 years that is the largest advertising agency in the world and arguably the largest retailer. now 32% of the internet advertising market is google's. there is a lot of people that think they can take more market share, probably more customers,
too. >> did you hear howard's numbers, when yahoo first debuted it went up 50%, google dvenl google was a slow and steady climb. so it wasn't initially loved. >> look at that list, say which of these companies is more pervasive in your life? google should be number one, based on that pet trick, you would think that google is under valued here. i think to howard's point was you are better off being an entrepreneur, starting a company, being bought by google tan actually buying google. nonetheless, i do like google. >> hack at hq courtney reaganb on hertz. >> hertz is hurting, pun intended. check out the shares the rental company now withdrawing its previous 2014 guidance and now expecting it will be well bow low what it had previously said for a number of issues both operationally and industry wide, actually calling out the record level vehicle recall, which has
constrained supply aamong other issues. look at that. >> dan, what's going on? >> what's interesting in the options market the volume traded two-and-a-half times the average daily volume. the two largest lines were the september 28 and 29th puts. the puts traded. a lot looks like thaibl they were being bought. people looked at other catalysts i don't see here or they got lucky. >> hertz is plunging in the after hours. up next, hewlett packard set for earnings after the bell. they are pushing in a big move for the stock. dan nathan has the options action on hp next.
when the world moves, futures move first. learn futures from experienced pros with dedicated chats and daily live webinars. and trade with paper money to test-drive the market. all on thinkorswim from td ameritrade. . >> hewlett packard is set to report after the bell tomorrow. dan is at the smartboard with today's "options action." >> the implied move is 5% that's vs. the fourth quarter one-day move and the eight-quarter average of about 10%. options market makers were not expecting nearly as much movement. a day before options volume ran
two times average daily volume. to me, when you look at the chart here, the stock has had an amazing run. this is a five-year chart here. it's come back to these breakout levels before this company actually fell apart. if you are looking at this thing, i think you look at 30 on the downside, 40 on the upside. if you have a directional view options look keep to play either directionally or with one premium for protection. >> we'll be watching hp earnings coming out tomorrow. can you catch more "options action" at 5:30. check out the website at optionsaction.cnbc.com. bitcoin digital currency getting caught by a mini flash crash. bk, you are an investor, you invested in it. >> i kind of department cool aid when it comes to bit cone. it's fascinating. here's what's what happened with bitcoin. you have a bunch of exchanges, ten, 20, more than. that they trade bitcoin.
they started offering leverage, market. but what they didn't start to do is standardize what was going on. so each of these traded their own examiner orders. none of them interact. somebody got a market call. all of a sudden it was triggering all the money, all the trading is automated. so you had a trop of about 500. a little below. down to 300 in a matter of the minutes. it's since recovered. but this is a huge problem for bit cone. it's actually happened on a couple other exchanges. it's not the first time this has happened. but the volatility in bitcoins is a huge problem. it's actually you mentioned the coin i created. now it goes to reason why we have a disability fund. it doesn't prevent a flash crash. at least have you some kind of speed bump there cushioning it down and presumably that's better for users of the company. >> don't you think for those that are investors in bitcoin, they're sort of acustomed to theses things at this point. >> no doubt. >> preceding the flash crash, it was stable.
welcome back to "fast money." i'm courtney reagan with some breaking news, following an earlier report by reuters, petsmart is saying it is exploring strategic options for the company, including a potential sale t. company also releasing earnings, re-affirming it's four-year guidance and beating earnings by 5 cents. so again, petsmart is exploring a potential sale or another strategic alternatives, pushing out earnings, re-affirming gyneand beating five cents on the bottom line. >> it's fine for final trade. quickly, tim. >> i talked eem. go with eeu. >> copper, gold and gas fcx i like it. >> it was fun. two nights in a row.
>> i love it. >> mcdonald's exactly held where we said it would held. it bounces back i think to $100. >> i'm sarah eisen. catch "mad money" with jim cramer starts right now. . my mission is simple, to make you mono pep 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." welcome to caramerica. other people want to make friends, i just want to make you mono pep call me at 1-800-743-cnbc or tweet ye @jimcramer. ten years ago today google launched its initial public