Merger deal with pfizers generics unit. And disney domination. The studio breaking an alltime record for annual box office earnings, and of course, it is only july. So, theres a lot for investors to digest this week with stocks at record highs. Jim, coming off of those on friday, you were out, but a lot happened good to have you back. Thank you the starbucks calls kind of the emblematic of what happened this quarter. Starbucks had run big. So you had to figure, no matter what, how could it really move then it goes up big dollars because its better than expected, better than feared what were seeing are companies that we were worried about because stocks have run, and then the stocks do okay. So, this is a short sellers dilemma. Lets say youve been betting against companies because you truly believe theres been an earnings deceleration. If earnings just stay in line, the stock flies. If earnings are a little bit below, the stock doesnt do anything. Right. So, theres just this kind of bid underneath because of that and because of fed chairman powell, and everybody feels he can say tariffs, tariffs, tariffs, so he stands up to President Trump, but weve got to cut by a quarter. Well get to powell in a moment, but starbucks examples a good one because yp morgue goes to neutral today on what theyre arguing are peak comps and that the nitro implementation, were not going to have these oneoff quarters in the future. Nitro is unbelievable and it is ignite the afternoon day part but its brought people in for other things, including food and thats really important. Kevin johnsons got people eating there this digital situation, the digital flywheel, as he calls it, is extraordinary by the way, mcdonalds, same thing. I mean, notion of convenience. Youre starting to really squeeze little companies again delivery is such a powerful thing for burgers and for coffee oh, my gosh today, theres a ton of restaurant news. Goldman has a 100page report in which they initiate chipotle, mcdonalds, starbucks as a buy, and deutsch initiates dominos as a sell, in part on what youre talking about. Thirdparty aggregators like grub and uber are giving people choices in ways theyve never had before, and thats bad news if youre a delivery stream like dominos. I happen to have ill tell you, i think it was a very honest piece i had rich alison, who is the ceo of dominos, on and he actually blames some of the weakness on the Venture Capital companies willing to back a postmates, a Doordash Doordash is a genuine disruptor, because doordash has 300,000 restaurants. And if anybody can deliver, then dominos does have real competition. It had always been dominos versus mom and pops. Now you have dominos versus wingstop, very good wingstop dominos versus any chain, chickfila, i dont know. I dont know where chickfila is, but im just saying that everybody ships, everybody delivers and if you its just kind of like, its Like Department stores if you can deliver like amazon, same day, okay one day. Well, we dont have one day for food, but same day for mcdonalds people love that i cannot believe how people love starbucks delivered. Really bad for, like, the blue stones. Yeah. We asked Kevin Johnson a long time ago, how are you going to keep coffee hot in a delivery mode and he had some answers. Well see if that holds up as for earnings this week, jim, i know you just told andrew youre watching apple. Yes. But there are a ton of other huge names this week. This week is just one of those weeks where if youre going to go down, it better be this week. Thats why i say its a short sellers dilemma because you have so Many Companies but theres a piece today by the evidence lab, not just anybody, the evidence lab that ubs i shouldnt make fun of them because its actually quite good basically saying only 19 of the people are bullish on apple, down from 30 in april, basically saying that apple is going to disappoint and people are going to like it thats the way i read this now, if thats the case, what is going to knock the market down its not going to be gm. Its not going to be exxon if yes, if jay powell surprised us but that would be terrible. Surprise us with nothing or surprises with 50 im happy with how things are going, because as janet yellen said, why cant we keep having expansion . I thought that janet yellen, once again, was someone who distinguished herself as someone who shouldnt have been fired. Trump has to regret that i mean, he had the ultimate. She was so great this weekend. Live and learn. Then he has to go fire and get some independent guy i mean, what is with powell . Why doesnt he go with the braha program . Powell probably sits there and says, oh, boy, if i cut, the president s going to like it so much, but then maybe he wants a 50 basis point i think the president wants a 100 basis point. Of course. I dont think the president wants interest he wants to be like germany. Negative yielding. You cannot satisfy President Trump on this issue. He doesnt like hes the king of debt, as hes said in the past yellen spoke in aspen over the weekend and did give powell some coverage, jim says take a listen. Although the u. S. Is doing well, i would be focused on wanting to keep it doing well, to keep the expansion on track, and i think in light of the risks, i would be inclined to cut a bit. I wouldnt see this as the beginning unless things change of a major easing cycle. All right, so that last part is key, right . Right. Youd rather hear, whatever we get, if theres a cut, youd rather hear guys be happy for now. Yes, because that puts it so that you have this kind of put if things get bad, hes going to cut. If things get good, hes happy i mean, what its a great scenario for bull, because hes there trying to help you out lets say they go to 320 billion, put tariffs on those because the trade talks go badly. Or lets say the chinese invade hong kong. Lets put it out there because the chinese put out very, id say declarative statement against hong kong. The president s ready. He would like some tariffs i think it evens rudy against the trade talks this week. He loves tariffs he think that his base loves tariffs. His base also, i think, has been convinced that the chinese pay the tariffs. Like, you know, senator we know thats not true no. We also know that the impact on the consumer is not as strong as some had feared. No. We really no one thought that no one thought that you could have at the same you take a walmart. At the same time they keep everyday low pricing, theyre delivering it you know, they want to put it in your refrigerator i dont know if you want someone coming in like, i dont care, what do i have but in the refrigerator what, going to steal a painting . Great, have a painting paintings already not good. But i look at what theyre doing and say to myself, there you go. Walmart is lowering keep prices low and theyll put it in your refrigerator. Amazon, that quarter was incredible i thought that when you read through that quarter, what theyre basically saying is, list en, everybody wants same day, they want one day and well give it to them and you can punish us, but were going to figure out how to do it and when we figure it out, were going to be kings so, amazon would be king kind of like kipling. The bull case you draw on amazon, downgrade at u. P. S. Today, to hold on challenging macro, capex climbing. Some of the charts over the weekend from deutsch looking at global trade with an overlay of fedex three months in advance is not encouraging. No, but fedex turned out to be quite different from fedex u. P. S. Will tell you this fedex has the big capex spend cycle ahead of them. They think theyve already spent the money, and they dont need to do any more and im very encouraged. I thought the u. P. S. Quarter was fantastic. You want to make a valuation call, thats fine. This market doesnt like valuation calls. Thats like downgrading starbucks at 89. I would think youd applaud some fiscal discipline, right, on your target well these stocks are blowing through analyst targets. U. P. S. Is abneys terrific. One of the reasons i love abney is hes from mississippi and i met fletcher cox, the great, you know, he really is the sack king for the eagles theyre friends. And i saw fletcher cox on friday with the eagles, went like this for u. P. S. There you go i mean, fletcher cox may be a hall of famer. No, i think u. P. S. Is unbelievably good, and therefore, not worthy of a downgrade. Interesting on friday, i listened to your show in the car, and you said something to the effect of, when youre up 20 on a single name, youd like to ring some registers. Thats the case for a lot of names right now. Yes, and this is one of the most gutwrenching moments for discipline im glad you brought this up, because what happens is, you see the starbucks downgrades today i agree with the downgrades. I love starbucks, but up eight points but then again, lets say starbucks pulls back to 90. Are they going to upgrade . Well, the framing of the call from jpmorgan is they want clients to buy lower. Yes. So its not that theyre saying divorce yourself from this name entirely. I think the piece makes sense. Thats why i understand it, but i just think that its a great hedge fund call. I think its hard for an individual to Time Starbucks and i think that starbucks can go down, but when it goes down, you have to buy up and we dont know where it goes down and most individuals cant time it the hedge funds want to time it. Remember, Kevin Johnson had a buyback. He sat there, 51 he cleaned up all the sellers. They kept hitting him. Then he moved to 52 i talked about the buyback it was almost like, lets play trader they jammed you the short you know, the long side is banging them at 51 and then all the selling dries up and he moves to 52. He goes, basically 52 for a million and they drill him no more 53 for a million drill him and when they get to like 60, theres like no one left, and thats how you have that chart theres no sellers maybe today creates some sellers. Pfizer mylan announced a major deal combining its offpatent branded drug business with mylan terms call for mylan shareholders to own 43 of the new entity pfizer shareholders get the rest in the meantime, pfizer and mylan each had betterthanexpected quarterly earnings, 1. 03 beats by 8 cents on the mylan side. You said nobody cares about this a few moments ago. Mylans stock was in a permanent down trend, you thought. And then they do this. Its almost like, you know how occidental did that stupid deal where they took 8 money from Warren Buffett the fact that pfizer even thinks that mylans going to exist is a really big deal. And mylan, did they get a good deal i dont know they doubled down on the worst part, but ive got to hand it to heather presh. She now has pfizer Heather Bresch, ceo of mylan, was watching her stock go down, and it was selling the pe is like lowest and people dont like generics. Suddenly, she does this deal and people say, you know what, pfizer doesnt think theyre idiots pfizers willing to partner with Heather Bresch. So, mylan comes out, gets more bang for their buck on this one . Yeah, and they got the up look, theyre the margins are not great, one, generics but i think that Heather Bresch is able to say, you know what, you think im awful . Pfizer partnered with us so cover your short. Thats true youve got that. Got to hand it to her. And sanofi beating and raising their guide, one of a string of raises. I think lillys going to do that i think mercks going to do that i think this is a week where youre going to love pharma, except for the fact that if you think Elizabeth Warren is going to win because in her new her position paper that she released, shes basically calling for Drug Companies to make no money. This is true. Because if you get a drug, a cancer drug say from italy, thats what theyre going to sell them for here from bristolmyers, forget it theres no profit. Theres just no profit, you know but Elizabeth Warren is calling for its very different in terms of if she becomes president. I think shes calling for a downturn of 20 . In the market yeah. It sounds about right, yes. Well, thats what shes going to give you. But if you dont lets say youre a worker and you dont earn any stock, what do you care but i read that position paper last night in preparation of being on halftime, and i read it and said, all right, okay, she doesnt want anybody to really make a lot of money, but thats what she wants. Right. Shes even talked around china and the president yeah, well, well get a debate this week there are some pieces out this morning on how the dems are sort of punting on china tariff, like dont have any better answers. They dont. Its really interesting because its a very workerfriendly dont forget that nancy pelosi didnt say anything bad about the tariffs. Yeah. By the way, Kamala Harris comes out basically with a plan that is not singlepayer you know, Elizabeth Warren i was in italy recently shes got an italian plan for our country, you know . Italy. Italian. Italian plan raised a fair amount of money. Shes going to win in iowa. I think shes shes a shes just a wow one, you know a spark plug but i do enjoy her because she tests capitalism, tests the basics ken langones probably not going to give her any money would be my guess. My guess, too none from ken. But there were two guys, they think she has it won engels would say shes coming, but shes not there yet. Shes a work in progress. When we come back, the lion king extending disneys Box Office Dominance well tell you about some truly staggering numbers coming out of the Domestic Box Office today. Take another look at the premarket coming off the record highs of friday. Have a big week ahead. Back in a minute your daily dashboard from fidelity. A visual snapshot of your investments. Key portfolio events. All in one place. Because when its decision time. You need decision tech. Only from fidelity. Julys not even over and disneys broken the annual box office record, almost 7. 7 billion in global revenue, including over 5 billion overseas, the first time any Hollywood Studio has passed that threshold internationally in a single year. The new version of the lie gron king is on the verge of passing 1 billion this week disney now has the five biggest movies of the year, avengers, marvel, captain marvel, toy story 4, lion king and alladin. Their combined share of the box office is 41 . Universal has 14 . If you look at the piece about moffettnathanson about cord cutting today, you would say i have to sell disney. Then you look at those numbers and as you say, john carter, all is forgiven. Youve got an annuity stream of movies so, what you have is weekends. If you look at weekends as your eps, like, how many lets say you miss a weekend, your stock goes down. They are doing when they come out, when their movies come out, they win the weekend, and so, therefore, i genuinely believe that iger has accomplished what i know he wanted to do five years ago, which is own almost every weekend they put out own every weekend they put out a movie. Therefore, you can finally put an earnings stream to it and a multiple so its not just disney plus how did the stock get to 145 . Some of it is disney plus, but some is a recognition, okay, they have a movie this weekend, theyll win and the big profits are there. Can you imagine if china would still china limits the number of movies now. Theyre a bunch of communists over there they do love their hollywood movies, though. Yes. They do. They do and i think they love Disney Disney works i mean, iger everyone was so focused on cordcutting espn i dont even care anymore really, its not youre saying the disney plus strategys not material to the overall stock picture. No, i think the disney plus, espn plus, and the movies make it so that you think about, i dont worry about espn proper anymore, which is really amazing because all we ever used to listen to is, when they dropped the bomb on espn, like they would go on, were great, were great, oh, but espn lost subs, but dont worry about it now the Conference Calls should be if i have to orchestrate his Conference Calls, which im perfectly willing to do its about how movies are no longer at episodiepisodic when you put a movie out, you can put a multiple on it because were going to do x, and above x, you can raise numbers so, iger did it. By the way, mini died, the voice of minnie. A saw that. I think we all know the voice of minnie. Then theyve got parks. I dont know if you noticed, for our parent, parks are coming up on a third of operating cash flow i assume the pictures not that different over at disney. No. Look, its a juggernaut. It doesnt whats incredible is no one believed it was at 105, 110, 105, 110 and that got it going. I tell anybody, at the april analyst meeting, you stay tuned. Stay tuned nobody believed it then he has the meeting and suddenly people go, igers a genius he was a genius at 105, 110. He didnt become more of a genius he was a genius, but he wouldnt get any credit until he laid things out and now hes doing even better than expected. I wish we would start wearing that under that shirt, i know he feels that same way. The striped shirt, thats not the iger we all know iger doesnt even wear a tie what im so aggrieved about i told him about it i said, look, ill speak to him about the shirt, but i have no juice i have no juice. Theyve got to change the shirt. Well watch disney today. What a story its been. What a story. Coming out of the weekend well get the mad dash and countdown to the opening bell. One more look at futures as we brace for a slew of news over the next five sessions dont go anywhere. As your life grows, so do your needs. And with bank of america and merrill, the benefits you get can grow, too. As a preferred rewards member, you can enjoy Priority Service and exclusive discounts. So your growing life can be more rewarding, too. What would you like the power to do . What would you like the power to do . indistthat was awful. Tering why are you so good at this . Had a coach in high school. Really helped me up my game. I had a coach. Math. Ooh. So, why dont traders have coaches . Who says they dont . Coach mcadoo you know, at td ameritrade, we offer free access to coaches and a full education curriculum just to help you improve your skills. Boom mad skills. Education to take your trading to the next level. Only with td ameritrade. Seven minutes to the bell. 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