Transcripts For CNBC Fast 20240703

To fruition. What it means for the streaming and the streaming place. Im courtney reagan, in this evening for melissa lee, coming to you live from studio b at the nasdaq we will start with apples revenge. Shares jumping 2. 5 in the session and adding 65 billion to the companys market cap just today, by the way. The stock closing above its 50day moving average for the First Time Since january the latest move coming after bernstein upgraded the iphone maker to outperform, telling investors to buy the fear. The stock had been down 12 in 2024 before todays call but can the momentum carry apple into earnings coming in on thursday, will it hold through all those numbers . Many of the big tech names that reported last week were under pressure today meta is down 12 since its report on wednesday. So, should investors worry that apple will fall into the same trap after its report or will it gain some appeal as a defensive play tim, youre nodding your head. What do you make of this call . Theyre saying, look, be buffettlike tonys had a great call on apple and i think hes picked out these moments. And i think the core to his thesis is that apple is relatively cheap to the market, relatively cheap to itself but his call that china is more cyclical than structural is interesting. I think that could be challenged, but theres no challenging the fact that apple has really underperformed the market its really underperformed the other mag seven, other than tesla. And apples underperformed the nasdaq 100 by 20 . This has been a big laggard. Its certainly something thats needed a catalyst. You never count apple out. Theres certainly no a. I. Or, you know, the to the extent youre going to have a refresh on the iphone cycle and theres something coming up great. Lets see. Its certainly not a bad call, given how much apple has underperformed i like that kind of a call i was thinking, it couldnt necessarily be a bad bet, but is it defensive i mean, do we even want to count it as magnificent anymore . I think its still magnificent. You look at that balance sheet, theres still a margin of safety were trying to change our definition of what magnificent is that was out of this world growth coupled with a margin of safety given a market thats shown some ebbs and flows and some, you know, puts and takes, perhaps the margin of safety is whats going to cause you to still label it as magnificent. Im just not sure i see the upside i think the downside is mitigated. You definitely want to kind of look at those types of trades, but in terms of the upside, and thats really where the magnificent question really comes in i doubt theyre going to say, weve absolutely knocked the cover off the ball in fact, were expecting weve been keeping this a. I. Tool under wraps forever and now were going to release this and this is going to lead to a reacceleration of growth and a reacceleration of Service Revenue growth so, i dont think that you have that rabbit in the hat thats going to be a surprise what that said, i think expectations are relatively muted, and the news with tesla might bode well for them being some warm spots in whats a cold technological war. Really good points. Dan, youre not rally expecting fireworks all of this apple report, right . Listen, my panelists made some great there it is bonawyn, you kind of nailed it, too. One thing i want to say about tony, weve all followed his work for two decades, he is not afraid to make contrarian calls. Hes not afraid. He has been on the right side of tesla now for a couple of years at bernstein, they dont care about Investment Banking business tony is a great analyst. I like him getting in front of it i dont think theres any catalyst thats going to come out on the call. I dont think theres anything about their china business, some expectations, iphone is down 19 year over year, so, the fact you have that whisper number out there, thats pretty good. I would be surprised if its down more than that, but the point about generative a. I. , what they come up with, theres been lots of reports theyre talking about to openai, to license that, whatever they do will be on the phone coming out in september, october, november. I dont know if thats much of a catalyst right now i would love to see this company kind of derisk from a guidance standpoint right now maybe they give cautious guidance for the balance of the year you know you will get some announcements, whether theyre positively received or not is another story. I think the stock is kind of expensive. If you think about this, Earnings Growth at best, high Single Digits, sales growth at best, mid Single Digits for the next couple of years, trading about 24 times, its just not that cheap and i know tony spent a lot of time talking about Free Cash Flow generation, the way he looks at it from a valuation standpoint, he thinks its relative i just dont know i would rather buy it a little weaker with worse segment into wwdc guy, does it feel defensive, though it has been, without question, on horrible market days, apple is one of those stocks that will go up regardless of what it had been doing in the prior couple days or the prior couple weeks. So, at times, its very defensive. I dont think in terms of valuation its defensive at all. Throw in the fact that margins have been flat lining the last year, year and a half. This is probably expensive we get seduced by the fact that its apple any other company, we would look at valuation, say, this is expensive. And this stock has not performed since july of last year, on a Broader Market thats done rather well. And i admire tony, as well, but if the stock trades lower, they will defend that call and they will reiterate that call as they should the question is, you know, can stomach 12 to 15 of downside, or is it something you say, you know what, i want to be in it, i dont care if the stock goes lower, because this is one of those stocks that you need to be in i still think theres some room to the downside i keep thinking about a. I. , and how apple plays into this. Weve all sort of danced around this, and obviously theyve had siri for a long time what else could they possibly say about generative a. I. , or a. I. Of any kind that would really jazz up investors maybe they dont have to be first, maybe they can be best . Yeah, i think thats fair ultimately, the a. I. Trade is not directly associated with what apple is going to give you, but i do think that the handset, the ability to also have the computing power, at some point, to really deliver on a lot of the underlying ad strength, sure i get back to a company that, guys talking about its defensive nature, absolutely apple was flat on a couple of the big down days. The risk reward to apple relative to its peer group, i think, is very compelling. If you look at the dynamic around their Services Business and the gross margin support that it gives the company, and the Free Cash Flow generation that tony at least references, youre talking about 45 , 46 gross margin this is something thats really attractive the Services Business isnt as sexy of a driver, and its something that will be very defensive in difficult times i think were all saying something similar, which is that, the companys not priced to perfection, though its not cheap. And so, you have something here going into those numbers where i think the bar is very low, and i think we all know the refresh cycle as it gets into dans comment about the fall, thats when you expect this company to do something, but maybe get something in june. Bonawyn, shares are only up 3 bigger risk they go down or up after this report . Probably go up, but again, its really about order of magnitude. I wouldnt really call a 3 move the grand revenge tour no. I think its positive they have broken through that 50day, that gives you shortterm catalyst you can kind of hang your hat on and ride that momentum even he is suggesting that you trade this between a range of 25 and 30 oneyear forward numbers. This is not him saying back of the truck, the valuation, you know, compels one to add this as a core position. Hes saying, this is now an entry point, a compelling entry point for a trading position and i think if youre approaching it from that standpoint, you understand that, sure, you know, i think that the risk reward is more compelling, however, the stock has not gotten to a point where youre now reallocating and taking dollars away from Something Else ill just say this, the stocks that gapped up last week, i mean, look at google and microsoft. They look like good reports. Google was a better report and a better guide relative to expectations than microsoft was, but theyve actually filled in google is on its way to filling in the gap, microsoft has filled in that gap we saw what meta and netflix did, a few others, it was just downright horrible if apple were to have a little bit of a relief rally, because its not as bad as feared, i dont think that sticks. And i think were probably getting to a seasonally weak period were going to get a lot of color on Interest Rates this week, with the fed meeting and obviously the jobs report on friday, but if we have a tenyear thats on its way to 5 , i think this is the thing that has been a cooling agent for a lot of these big names over the last month or month and a half or so, and i think will continue through the course of the summer until we have better clarity when some investors can start to price in lower Interest Rates. I dont think its here. If this stock were to pop and get towards 180, i think you sell it and look for a better opportunity into wwdc, which, again, is not that far from here, but that phone refresh cycle is a long ways away, and anything that they do licensing someone elses technology to go on their phone, they have not been great at doing that in the past, so, i dont expect it to be a big driver for this cycle. Fair enough you opened the door to a macro discussion i want to talk about the yen, falling to another 34plus year low against the dollar the currency weakening to more than 160 yen per dollar for the First Time Since april of 1990 but retreated amid reports the japanese regulators could be intervening to prop up its value. So, tim, what do you make of the volatility in the yen . I remember in 1990 when this happened just kidding, i dont remember when that happened you cannot. You were not born. I was born. First grade. Bojs credibility is shot thats whats going on here. And to the extent that Everybody Knows an intervention doesnt work, the market then pushes as hard as they can if there was one or not, i think guy has a view there was, ill let him talk about that. The ultimate message for banks around the world is something thats scary this is not sending a lot of confidence i think yields have to go higher in japan the good news is also the bad news they want inflation. Theyve had three decades, four decades of deflation, and as weve talked about many times on the show, japan is the largest buyer of u. S. Treasuries, and that doesnt bode well here, especially when their buying power at 160, 155, 145, is not what it was. And i do think its a case where markets will push and push and push, thats whats going on in japan right now, and its not positive for the sense of volatility in markets overall. Guy something happened last night. It traded up to 160, 10 00 our time, within minutes, it was down to 156 and change, 155 and change, so whether or not it was an intervention theyre going to announce something clearly did happen, number one tim is spot on their credibility is shot. They can intervene all they want, its not going to work in order for something to work, they have to raise rates in a meaningful way, but that will crater an economy thats already sort of on the brink, so, they face a huge dilemma here their currency is going to continue to weaken, which is really bad for the people that live there, or theyre going to have to raise rates to defend their currency, which, by the way, is really bad for people who live there and his point about owning treasuries, thats one of the many reasons that u. S. Yields continue to go higher. The fact that this is the third or fourth largest economy in the world and nobody seems to want to talk about it is staggering to me. Bringing it back to u. S. And bringing it back to a company we were just talking about, apple, almost 60 of their sales come from outside the u. S just think about that. Its a very expensive, aspirational product in most parts of the world so, you have a dollar, at least the u. S. Dollar index, is up 4 year over year so, were going to start hearing constant currency. Were going to hear that again and again. We heard it a lot on the Conference Calls trying to figure out what is the organic growth and demand, but some of that can be forwarded by the dollar translation here. Thats a really good point. It isnt just earnings and the dollar on investors radar this week also the fed decision, by the way, on wednesday. The april jobs report on friday. So, for more on all of what this could mean for markets and stocks, lets bring in yungyou ma we saw some surprises with the gdp number, for example, but then the pca came in pretty pce came in pretty much bangon. What are your expectations this week, which Economic Data point is most important to the equity market great to be here, courtney. And definitely a lot of data this week. We think probably the most important thing will be some of the under the hood numbers with the jobs report. We actually think when you look at hourly earnings, when we look at labor force participation, we think thats going to set some of the tone for whether or not the market thinks that the inflation pressures will ultimately be on a downward trajectory, or if we just face a very protracted battle, which chairman powell is probably likely to point to in his messaging on wednesday, so we do think theres a lot of data thats going to come out, the fed will probably be seeing a little bit of hawkishness to the markets and the markets might reprice a little bit the prospect of having no Interest Rate cuts this year. Wow yeah, obviously, weve gone down from six and so, we are far away from those initial expectations. Were almost at the end of april, when you put everything together, when youre looking at the Economic Data points, do you think its going to be that type of year . We dont think so we dont think thats whats advisable here we think the Growth Drivers are in place for the second half of the year we think corporate spending is starting to pick up, and that will be a big driver for the year and as long as inflation can remain relatively stable, that the investors and the market can focus on that growth and profitability thats starting to improve. And we can overall see traj trajectory the more growth we get, well see lift in the treasury yields, which is going to cause tension in the market. Its not going to be a straight line, but we do think that gout is going to win the day, and provide a healthy backdrop here. Maybe thats framing the answer to my question, which, youre a cio, you are managing risk, you are thinking about allocation, seems to me the market has kind of decoupled with the reality of not only not five cuts, maybe not any, and so, do you think that, and do you think that changes the thesis for equities here you know, its not a goldilocks scenario anymore. I think it changes the backdrop. We dont expect the markets to just be this constant grind higher but i think that overall, if you think about how do we tant to allocate risk, we want to have a healthy allocation of risk, and we want to look for areas that can outperform, but no, its no longer the golly locks scenario of having falling inflation, a fed cutting rates aggressively, and strong growth. So, you heard us hopefully having the conversation about the bank of japan and yields, and you dont have to agree with us, but how important are tenyear yields . I think were on the way to 5 the market doesnt seem to care right now. Should it or where will it i do think its important i think the market will start caring if we start knocking on the door of 5 and certainly if we get beyond 5 we hit 5 in late october of last year, so, theres a little bit of experience weve had that definitely jarred the market perhaps caused the markets to be a bit immune to another trip toward 5 , but i think that if we do get a push past 5 , thats going to be much more of a wakeup call for the markets that that level that we reached before could be surpassed and perhaps substantially. So, we do think its a big risk in the market here, and it is something that we think the markets are going to be very sensitive to over the next few months a lot of factors to balance thank you for helping us try to do just that, yungyu, thank you for being with us. Bonawyn, how are you going to put that sort of into your calculus we have to balance amazon earnings and apple earnings, nvidia also coming up. I think heading into the week, this is a huge earnings week, and thats where the focus tends to shift i think weve gone from expecting five to six cuts across the board to now saying zero and theres whispers about more hawkish, or dare i say, rate hikes, so, i think that backdrop has kind of shifted. The gdp number throws in a bit of a question mark were expecting, you know, 2. 8 , 2. 7 , and we came in around 1. 8 couple that with pce, which was slightly hotter. I just think its hard for us to now say were clearly still in this soft landing goldilocks scenario, which makes me refocus on earnings. And you asked earlier if im looking at margin of safety, magnificent seven, i still am looking to that complex to an extent you know how i feel about nvidia i mentioned meta, i think thats a bit of a unique situation there, where theyre now reaccelerating spending. I do expect that to present an opportunity. You know, aapple, again, i think theres a defensive aspect and google was a surprise. I think that stock has been flat, and they had strong earnings there, new dividend i think there are pockets of the market where you can play. I just think that its going to be a lotearningdependent and not so much about a thesis and when and how much the fed is going to cut all right, well, coming up, were watching paramount shares on the move after the companys earnings report. How the ceo stepping down will impact the future of the company and the latest on deal talks, thats next. And by the way, speaking of earnings, sofi getting hit what has investors heading for the door on this heavyweight well explain when fast money returns. Were back in two. Still have a lot of show for you. Youre watching fast money here on cnbc well be right back. With no children and no casinos. We actually have reinvented ocean voyages, designing allinclusive experiences for the thinking person. 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Dont wait call today. Welcome back to fast money. Earnings alert of paramount. Shares volatile after the Company Reported an earnings beat, but a revenue miss paramount also announcing the departure of Ceo Bob Bakish and outlining a new leadership plan. Julia boorstin has the details what did we learn from the Conference Call . Theres a lot of moving parts in this story we learned basically nothing from the Conference Call it was only nine minutes long, with zero q a. The company just reiterating its big news that Ceo Bob Bakish is out, replaced by newly created office of the ceo, which consists of cbss ceo, ceo chris mccarthy, and brian robbins. They are meant to work closely with the board, but there was no comment on who overseas streaming, and this is meant to be temporary or permanent. Todays changes seem designed to make it easier for the company to do a deal, but there was no word on skydances best and final offer for paramount global made yesterday, or whether sherry red stoen will entertain an offer from apollo and sony, which is expected to come as early as this week there was also no word on tomorrows deadline for paramount to negotiate a deal with charter, which, courtney, is a very big deal for its value. Absolutely. Theres so many questions unanswered only nine minute, no q a thank you for keeping us up to date dan, what do you make of this . A lot of news flying around this company whats best, what did you want to hear what do you still want to hear i dont really care what happens. But with berkshire the largest shareholder, i would take the apollo sony deal and walk away, because it seems like a mess yeah, it does seem like a mess whats interesting is national amusements, this is the Redstone Family entity that controls 80 of the stock, can do whatever they want anyway, so, its clear the skydance deal, which is one thats also coming from funding from skydance and red bird capital. Its a very interesting deal, because i believe this is going to begin to unlock theres other assets out there in the media space, wbd, right there for a place thats well, well, well off its, you know, off its highs, but also the sum of the parts dynamics around what are those assets really worth . We know where linear tv is, we know where some of the streaming business is, the amount of subs that even paramount has is pretty impressive, all Things Considered so, thats why this deal is why we care about, dans right, to the stock market, nobody cares about paramount, no one has for a long time. And netflix is so far out in front of everybody, but its a fascinating time, and again, some of the smartest folks in media are in an around the hoop in this. So, its about the streaming landscape . Its about the deal the nineminute Earnings Call tells you all you need to know removing of a ceo, replacing them with a group of three, i think, theres too many cooks in the kitchen, or chefs in the kitchen, whatever the saying is. It seems a bit chaotic, but it draws a lens squarely on getting the deal over the finish line, and i think there is still that wiggle room in terms of the majority of the minority vote. I think that could sway things to an extent, but as to mention redstone owns, whatever it is, 75 , 80 , so, this is going to get this is really about the deal i dont really think focusing on earnings or streaming that landscape may look drastically different six months or a year from now under new leadership, and under presumably a new merger agreement. Fair enough. Weve got a buzz kill for you on sofi technologies. The stock plunging over 10 , as guidance from the Second Quarter came in lower than expectations. The ceo saying that 2024 is a transition year for the company, as it shifts focus to areas outside of lending sofi raised fullyear guidance so, should we expect a pickup in the back half . What did you make of this report a little messy this is a company thats also had a lot of volatility in the share price, because theres been different dynamics around their core business. And i think this is just another question there if you think about a world where funding was at x, its now at x plus 500 and rates are staying higher for longer. Thats squeezing businesses like this that dont have the same accept to capital. Having said that, theres nothing wrong with the underlying, its really just a question of, in this environment, after a snapback move, this is a pullback off of what had been, you know, a snapback move guy 6. 75 has held for a long time, were basically there now. Analysts want clarity on their loan book. This is a stock you trade, steve grassos brought this up a number of times, at the lower end of the range, i would rather own it here than sell it here. Okay. Down more than 10 in trading today. Theres a lot more fast to come heres whats coming up next you dont have to do much digging. The mining trade is up next. Why one copper producer could be headed for a breakout. And why the ceo is feeling the metal mania. Plus, just when you thought this trade was out of charge, tesla bounces back the headline driving todays bounce, and why china might just be throwing a bone to ceo elon musk youre watching fast money, live from the Nasdaq Market site inim tes square. Were back right after this. s s are maximizing ai capabilities across organizations with microsoft copilot. Aipowered solutions and devices make complex tasks easier and cybersecurity stronger, so everyone on your team stays protected and productive. Make amazing happen. Microsoft and cdw. three little birds by bob marley the wailers discover our newest resort sandals Saint Vincent and the grenadines, now open. Visit sandals. Com or call 1 800 sandals. Businesses go further with 5g solutions. Thats why they choose tmobile for business. Pga of america and tmobile are partnering on 5gpowered analytics to help improve player performance. Tmobiles Network Helps aaa stay connected nationwide. To get their members back on the road. And Las Vegas Grand Prix chose tmobile to help fuel operations for one of the Worlds Largest racing events. Now is the time to see what americas largest 5g network can do for your business. Welcome back to fast money. Shares of free mort mcmoran up 23 this year, as metal prices have soared. Gold hitting multiple records this month, and copper on pace for its best year since 2016 freeports ceo optimistic. The fundamentals for copper are very good, both from a demand standpoint and the challenges in meeting supply the outlook for copper is very positive, ive never been more enthusiastic about it. Guy, this is one of yours, you pointed out today. Tim, too. I like everything about it, i mean, forget about valuation for a second, i mean, its effectively, there are a lot of sub stories. Its a copper story. And copper is breaking out theres a supply demand imbalance in copper thats not going anywhere soon in terms of Getting Better and freeport wins to this. Were within an earshot of the alltime high, made in the spring of 08, and i think we get there. Richard has been there therefore, and hes not one for hyperbole. He knows of what he speaks, so, i think you stay with it here. I agree 26 in copper since february 9th. A dynamic where there are supply shortages. Theres always volatility in terms of the supply chain in copper, but whats interesting about freeports numbers, in addition to, yes, there were higher gold and copper prices that were modeled in, and you get to these higher prices, it becomes almost a mechanical followthrough where you have to were fivetenths through the year, almost, where you have a dynamic where they have to upgrade some of the some of the copper and gold pricing in their models, but the production in Operations Costs were down 11 year over year that to me is the whole story in the space. These companies are run differently. Theyre run better theres been some concern that gold miners, especially, havent really responded to the higher gold price, because they dont have the operating leverage in their business i think thats starting to change i think thats something were starting to hear guys right, this is mostly a copper play. Look at southern copper. If you look around the world theres a number of plays in peru you have different ways you can play it, but freeport, certainly over here, is aname people know. All right, coming up, still some charge in this trade. Tesla clearing a major hurdle in china, as ceo elon musk makes a surprise visit what it all means for the future of the ev maker in beijing those details are next plus, home sweet nope. Why the American Dream of Home Ownership may be even further out of reach, and why renting may be easier on your wallet all of that when fast money returns. Missed a moment of fast . Catch us any time on the go. Follow the fast money podcast. Were back right after this. Thats right james, it isnt. Car, where are we going . Were here. surprise the future isnt scary. Not investing in it is. Car, were you in on this . Nothing gets by you james. Nasdaq100 innovators. One etf. Before investing, carefully read and consider Fund Investment objectives, risks, charges, expenses and more in prospectus at invesco. Com ella fashion moves fast. Investment objectives, risks, charges, expenses setting trends is our business. We need to scale with customer demand. In real time. jen so we partner with verizon. Their solution for us . A private 5g network. ella we now get more control of production, efficiencies, and greater agility. marquis with a custom private 5g network. Our customers get what they want, when they want it. jen now were even smarter and ready for whats next. vo achieve enterprise intelligence. Its your vision, its your verizon. Welcome back to fast money. Stocks kicking off the week in the green as investors look forward another big batch of earnings, as well as the next fed decision on wednesday. The dow jumping nearly 150 points the s p and the nasdaq up about 0. 3 shares of dellata up 1 today that stock up more than 25 this year and some more afterhours action to watch lattice semi lower on disappointing Second Quarter revenue guy dance, nxp someis up chegg dropping after announcing its ceo will step down, as well as posting its own disappointing revenue guidance and tesla closing the day up more than 15 , following elon musks surprise visit to china over the weekend it was the stocks best day since march 2021 the company passing a major hurdle to roll out its full selfdriving technology in the ev makers secondlargest market phil lebeau joins us now with more on this key trip. There has been so much tesla news recently, phil. Tell us the latest well, courtney, the importance of this is because china has been so important and so lucrative to tesla and it hasnt been able to get full selfdriving subscription revenue from that market that could be changing here are the details of the deal that was announced by tesla in china over the last 24 hours it will expand its autonomous drive technology, the ability to use more of its technology there in that country, and it doesnt immediately mean the fsd rollout, but it does clear the path for that to happen. And weve been told by sources that baidu is the Company Providing some Technical Details to support tesla, including mapping, which is critical in that country you mentioned that china is teslas secondlargest market, a lot of people refer to it as the largest market, with 33 of its sales coming in that market, and it has long had very successful cop rations there, but the key here, you want that Monthly Subscription, if at all possible, thats the allure of fsd. Certainly the allure for investors. Heres what fsd looks like here in the United States and again, this is just pricing in the u. S when you buy a tesla, you can buy 8,000 right now, thats down from 15 15,000, or you cano a Monthly Subscription of 99 a month. Thats the key here, that Monthly Subscription every automaker is chasing it right now. The take rate is unclear some have estimated it could be as much as 10 of the tesla buyers who actually go for that Monthly Subscription or buy fsd. As you look at where tesla is in terms of utilizing and tapping that market, keep in mind that the company did say in january approximately 400,000 customers through its entire history have bought fsd or have subscribed to it we dont know what the current level is and we also dont know the revenue that tesla gets from full selfdriving, and that, at the end of the day, courtney, that is the key. As you take a look at shares of tesla, yes, we know the robotaxi gets a lot of attention, because elon talked it up on the call last week and well see the unveil in august we dont know any Details Behind robotaxi. We dont know when that might become a reality, if it becomes a reality. But full selfdriving, the key is that monthly revenue. Every automaker is chasing it, and by the way, nobody has cracked it nobody has figured out how to get it to the level that you get with an apple iphone, so, these are the kinds of things that theyre working on, and thats the importance of this for tesla. Quite a day thank you for walking us through all the wig developments, phil, appreciate it very much. Dan, i feel like i was here last week and you were talking about elon musk and if hes all over the place when it comes to his direction leading all these different companies. What do you make of this this seems like a signal yeah, no, its interesting. Back in january, elon was whining about the Chinese Companies were going to demolish every other ev maker if theres not trade barriers put up against these cheaper cars going around the world and i find it really interesting that he has this meeting with the tpremier that he has a special relationship with and come out with an announcement without any real details to it i wouldnt hold your breath for when full selfdriving hits in china. They are a surveillance state, okay and this company, teslas full selfdriving, or, its called supervised full selfdriving theyre not allowed to use that title. Uses cameras so, the cameras are from a surveillance standpoint, the chinese are not willing to put up with. So, i think this thing has a lot of potential hurdles here. Im surprised the stock rallied so much. I didnt think it was good earnings, the delivery number, which was really bad at the start of the month, took a lot of the air out of the story, but it probably has more room to run. This stock has had big rallies after it reported earnings after big selloffs on disappointing results and guidance fair enough bonawyn, what do you make of the potential with baidu, giving more credence to what we might be getting out of china. Well, first and foremost, i think its a positive, just in terms of at least there being some semblance of ability to move forward and reach an agreement here so, i do want to acknowledge that you know, i think the devil will be in the details, to the extent you are granted access i think that actually bodes more positively for baidu thats the way i would tend to play this. The other ones that are licensing the information, any Sensitive Information is going to be passing through them as a conduit. And thats going to be com compcom completely warehoused within the Chinese Government tesla came out with earnings, disappointing eps, disappointing revenue, disappointing deliveries, disappointing operating margins and income so, the fact youre getting this news after all of that, i just dont think the sentiment on the stock could have been anymore negative its really just about a counter trend trade. I think there is probably legs to this, but all in all, that downtrend is still very much in tact, and i tend to lean towards baidu as being the winner. Interesting guy, if tesla can crack china much more than its done, i mean, this opens up a lot of opportunity. What does that mean, though because Chinese Companies have cracked china. Yeah. They already have full selfdrive there and theres seemingly no revenue on the back of it. Cracking it is one thing cracking it and giving revenue for it is something entirely different, i think but i get it, the headlines are favorable. You still need a license for full Service Driving in china. I dont think there was any acknowledgement that they got that all those things being equal, to dans point, bonawyns point, yeah, its in a 3 1 2year downtrend, probably still has room maybe to 215, then you sell it again. Fxi, this is third, you know, stuff, its holding in like a champ since those january lows and i think alibaba is getting ready for a move that weve seen over the last couple years to the upside. Coming up, is Home Ownership really worth it . A new study shows its no chuper to rent than own in all of the biggest metro areas. The immre cases of this big switch for the housing trade, thats next. Plus, dont touch that dial. Weve already kicked off another huge week of earnings. Apple, amazon, and a whole slate of consumer names on the docket this week. How options traders are gearing up thats right after this. Welcome back to fast money. To buy or to rent . That is the ageold question be the you live in any of the 50 largest metro areas in the u. S. , a new report may have a surprising answer. Cnbcs diana olick has more on that story diana, given u us the facts. Okay, courtney. The rent versus own map used to play out differently city to city, but Home Ownership has become so expensive that renting a home is now cheaper than buying one in all 50 of the largest u. S. Metro markets and thats according to a new report from bankrate, which compared monthly mortgage payments to current rents. The monthly mortgage payment for a median priced home, around 412,000, was 2,703 that includes property taxes and insurance. Compare that to the National Monthly rent of 1,979, which includes renters insurance. Thats a 37 gap between the two. Now, in 21 markets, the gap is actually 50 or more those include san francisco, seattle, salt lake city, austin, denver, and dallas cities with the smallest gaps, though still more expensive to own include detroit, pittsburgh, philadelphia, cleveland, st. Louis, and tampa now, these numbers are as of february, when rates were slightly lower than they are today. Rents have been easing despite rising demand, because there is so much new supply coming on the market this year mu multifamily starts have dropped. Once that supply gets eaten up, rents could rise and change all the math again how do you sort of factor in the whole idea of ownership versus renting, where, you know, youre not Building Wealth over time how does that calculus sort of play into the value . Exactly right. That is not in this equation this is simply the Monthly Payment, and a lot of people will buy not on the home price, but on the Monthly Payment so, thats how they did this Home Ownership builds wet. Historically, home prices have always gone up there was the Great Depression and the great recession. Otherwise, home prices will rise five to ten years you stay in that home, youre going to build wet. Its just a question how expensive a fact youre in and how long it takes to start to build the wealth after youve put the money in, even if it is slightly more expensive on the Monthly Payment. Its of course very fascinating and Many Americans biggest asset is their home, something to really think about and look at the facts. Diana, thank you tim, any thoughts, you were kind of nodding first of all, lets acknowledge, diana knows a lot about housing and shes been doing a great job for a long time and kind of reminding us what those trends are i mean, sometimes it seems, and sometimes i get lost, even, in the macro that we have that are higher rates i do feel there should be pressure on pricing, especially that whole segment that we just talked about, ultimately, if its cheaper, doesnt that mean that in a better option, doesnt that mean that rents are going to go higher and doesnt that mean that prices for houses, which are so expensive, that prices have to come down, because theyre unaffordable so, thats kind of my view of the secular trends, but the dynamics here are really interesting. If you are investing in home builders, youve been kicking it for the last six months, and the valuations arent even that awful. Whats an interesting name is a whirlpool, which is near, i think, fiveyear lows, almost near its covid low they just had numbers out a week or so ago. The margins were terrible. It puts a lot of pressure on the second half. This is an Interesting Company to me, based on where its trading now. That would be on a trailing or historical multiple. I think its really attractive here its been killed interesting. Coming up, were getting a check in from the options pits to see how traders are handling amazonefth bore e results. Thats ahead thats ahead more fast money in two just start with a domain, a few clicks, and youre in business. Make now the future at godaddy. Com airo your shipping manager left to find themself. leaving you lost. You need to hire. I need indeed. Indeed you do. Indeed instant match instantly delivers quality candidates matching your job description. Visit indeed. Com hire sandals jamaica sale is now on with rates from 199 per person per night. Visit sandals. Com or call 1800sandals welcome back to fast money. Amazon gearing up to report earnings tomorrow after the bell the stock up 20 this year, having hit record highs earlier this month and one options trader is making a big bet that tomorrows results could unlock even bigger gains. Mike khouw joins us now with the action what are you seeing, mike . Yeah, so, amazons implying about an 8 move after they report earnings by the end of the week calls significantly outpacing puts by 2 to 1 one of the larger trades we saw today waa contract thats over 2 million in premium. And what i like about this trade is that they are looking out, not just to this earnings, but the next one, giving themselves a little bit of time for this to pay off, and also defining their risk, because that, of course, is taking on the alltime highs, which we saw just recently got it, thank you very much, mike this is a big one. Theres so many facets of this name, dan, obviously, the consumer, but people care so much about whats going on with aws. Yeah. A. I what are you looking for there are things you can take away from microsoft. They saw reacceleration in azure, maybe thats shaking share from aws but if they are dialing up their spending as it relates to generative a. I. , this is not something theyre working on some of their own stuff, but they dont have what microsoft has, they dont have what google has. I could see the stock going lower on the fear of higher spending also. This is a tough one. You want to wait and see what they have to say youre right up against those prior highs from the fall of 2021 and its sort of like the google trade. Going to break out in a meaningful way sounds like a big immplied move it is its a coin flip, at best. I would rather wait and see what happens. Hopefully they miss and buy the selloff. Coming up, its already time for your final trades. vo what does it mean to be rich . Maybe rich is less about reaching a magic number. And more about discovering magic. Rich is being able to keep your loved ones close. And also send them away. Rich is living life your way. And having someone who can help you get there. The key to being rich is knowing what counts. University of maryland global campus isnt just an innovative state school, its a school for real life, one that values the successes youve already achieved. Thats why at umgc, you can earn up to 90 credits toward the bachelors for prior learning and life and job experience, why we offer scholarships and affordable tuition, and why we have online classes and the support you need from your first day to Graduation Day and beyond. No application fee if you apply by may 31st at umgc. Edu. Its time for the final trade. Lets go around the horn. Tim . Courtney, great having you. Bhp miners. Not just copper, not just gold, but a little bit all over the place. I like it. Bonawyn . Listen, i think this licensing deal is positive. Its more positive for baidu. Dan . Yeah, the google looks like it wants to fill in, if it gets back towards 160, i think you reload. Guy . I know there are sixer fans out there that watch fast money, i mean are there . Thats too bad. I dont know. A lot of knick fans in philly. There were. Courtney was talking a lot of smack before. Ali ban ba. Thank you for watching fast money. Watching fast money. Mad money with jim cramer starts now. My mission is simple. To make you money. Im here to level the Playing Field for all investors. Theres always a bull market somewhere and i promise to help you find it. Mad money starts now. Hey, im cramer. Welcome to mad money. Welcome to cramerica. My job is not just to entertain, but to teach you. Apple and tesla led the market today. Nasdaq climb