Transcripts For CNBC Fast Money 20151210 : vimarsana.com

Was it enough to turn the tide with investors . A case of conscious uncoupling. Gains for oil stocks despite a second straight day of losses for oil. Are stocks pricing in a bottom for crude . What does it mean for the rally . I dont think so. Welcome. The Oil Volatility index is still above 50. Brian kelly outlined a number of times oil was headed down to 20. Its getting close. I still think the commodity is actually under pressure. Why the Stocks Holding in there . I dont have a good answer other than fact people are saying oils got to be close to a bottom. I dont think the turns coming. Theyre expensive. Exxonmobil at 22 times forward earnings doesnt make sense in this environment. Neither does schlumberger. All those stocks are going to revisit august lows. If there are bigger implications for what we are seeing in commodities versus stocks . The price of oil versus the overall market has been closely correlated. The problem is some days its correlated, some days its not correlated. You cant trade off things one day are on, one day are off. To guys point, the only names that seem to rally are those big names, exxonmobils, chevrons. So the eogs of the world with. Although they are good position with acreage, they cant catch a bit. The only spot, refiners. Maybe some Service Names. Even Service Names have been under pressure, down 10 or so for the year. The only names you see that are up are the refiners. Theyre up big. In the 40s. Tesoro, valero. Did you buy any of those names . No. Clients have been buying. The problem is they are so under water they are adding to a lot of their positions that they already have caved in on. Thats the key. How many of these guys can survive the year with these positions that they hold. Are you trading any energy names . Im short oil. I have the view oil goes down to about 25 is where i think it ends up. I would not be buying any of these names. Weve seen this before. When you have a risk off type of environment where stocks like the fang stocks, amazon, netflix, google, those are starting to crack and people are covering their shorts in the oil space. Whether they are covering shorts or adding on to alreadylosing positions, i wouldnt necessarily call this people saying this is the bottom in oil. Certainly why not lets cover shorts here. If you were short these names, you did very well. Oil has a long way to go. Youll probably get one of those big spikedown days and know oil is making a bottom. There is an interesting article in the journal saying we are not seeing any benefit in the consumer names we would typically see from the price of oil hitting multiyear lows and the overall economy. I like retail stocks. Thats been frustrating to not see them shopping at the particular stores i like. They are at home depot and buying cars. They are saving. I always say thats not great, but it is good for the consumer at large to be saving money. I have thought for a while we would see more of that. I dont know. I dont think the American Consumer is changing their stripes and not being the consumer any more. Yesterday we saw oil spike after that draw in oil. We saw it spike up to 38 and change. Today it closes 6 lower than where we saw a trade yesterday. You cannot call a bottom in oil with that volatility. Where did the pressure come from . Oil futures were down more than 10 since the opec meeting. Is that weighing on prices here . Yeah. There is no regulator on the oil any more. Weve got all kinds of oil coming online. Not only that, we have seen rig counts decline, but production hasnt climbed to any meaningful extent. Thats where i get my 25 number. That covers your operating costs. When you have opec out there, and opec estimates are lower than 25. Some people think they can operate 10 to 15. These are difficult numbers to put a pinpoint on because its well dependent. Point is, oil, when you have a price war and people are going to take it right down to their cash cost, right down to their operating costs, weve got a long way to go. Lets go to seema mody. El againy reducing its Quarterly Cash Dividend to 8 cents from 18 cents saying Challenging Market conditions impact our products. The stock is down 1 after hours on this news. Thanks very much. Seema mody at headquarters. What i would take from this is investors should take this and say its starting to spread a bit. We saw high yield, particularly in the oil patch with oil going lower. We saw those Companies Cut their dividend. Now its in the material space in steel. The other areas showing distress are retail and some tech. I would be careful with higheryielding names. You may see dividends get cut in the next six months or so. Lets stick with energy. Conocophillips surging after announcing plans to cut its capital spend buying 25 . Morgan brennan at headquarters with the full story. Thats right. Conocophillips slashing Spending Energy as Energy Prices stay lower longer. Saying 2016 capex budget will be 7. 7 billion, down 25 from an expected 22 billion this year which has been revised three times lower this year. Down a hefty 55 from 2014. Its cutting operating costs again. Those are down 20 from 2014, arguably more aggressive than peers. Production slow growing. It expects to keep shedding noncore assets including up to 2 billion worth of sales in 2017 on an investor call executives reitting plans to maintain dividend. Chevron also announced 24 capex cut for next year. It has been a week of capex cuts. Thank you. Morgan brennan. For more on conocophillips, lets bring in the fast line. Pavel, good to talk to you again. Thank you. Do you take the ceo of conoco this week, today, and then chevron yesterday at their words that the dividends, no matter what is safe . In these two cases, yes. If we go back a year ago there were 16 sorry, 19 u. S. Oil and Gas Producers that paid dividends. Today, 16 of them are still paying dividends. Thats only three companies, and chesapeake is the only large one of those that has suspended dividends. By and large, 1 1 2 years into the down turn, dividends held up pretty well. Thats because generally among the larger names, and conoco being among them, Balance Sheets arent pretty. Conoco is not as good as chevron, but i think the dividend is safe in this case. Pavel, when they talk about the capex, what assumptions do you think are baked in for oil . Probably 45 for next year. On our model, we put in future pricing which is 45 wti. These guys should do 8 cap flow. Thats where you get the 8 billion capex. The dividend will still have to be borrowed. Or paid from asset sales either way. But at least the capex is being covered. This is the mantra now. I was on your show two days ago saying the mantra was live within your means. Thats why we are seeing even the largest players like these guys and chevron cutting capex 25 . Some smaller ones, murphy oil comes to mind, are cutting 60 . Thats for a second year in a row, i might add. The austerity on steroids across the industry is really kicking in. You said earlier Oil Production has not yet rolled over. I probably debate you on that. It actually has rolled over in the u. S. And brazil, a few other places. Next year those production declines are only going to get steeper. Austerity on steroids is a good way to put it. Good to speak with you, pavel. Thanks for calling in tonight. How is that austerity on steroids if they are borrowing money to pay their dividend . Cutting their budgets and borrowing money . Thats greece. As a shareholder, dont you appreciate the dividend . Absolutely not because they are going to cut it. These dividends are not safe. Watch out. Kinder morgan, they cut their dividend, the stock traded up. For those names they felt the dividend was safer. There are many if they do cut the dividend the stock goes higher. Are some people looking at the european giants like bp who have said they are going to preserve their dividend, but some are wondering if they can do it. The bigger companies, bp is one of those flagged as far as what their leverage is and liabilities are. Bp seems like one that would probably not be in as much danger as a Smaller Player with a lot more leverage. I think the whole place, the whole space is susceptible if Oil Continues on this slide lower. You can look at the oil patch. I would look at some of the secondary third type of plays. For me, its dr horton. Big home builder in texas. Lots of exposure the last two quarters. They talked about weakness in their texas market. When talking about capex being spent, one persons savings is another persons profits. Dr horton at the highs of the year are very close to the highs of the year. At the least, i would be taking profits. Thinking of the big names. The one that is most scary is petrobras. It gets scarier all the time. The unintended consequences of our reckless fed is this easy money policies allows companies to do what bk was railing against, artificially creates dividends that shouldnt be there in the first place. Exactly. Transocean 19 times still expensive. Conocophillips and exxonmobil with oil going down are still expensive with these valuations. The fed is going to raise rates next week. Just to piggy back before we go to commercial, rdc down 25 yeartodate. 12 revenues from conoco. Nobody likes oil here at the table. Coming up, golden globe nominations going crazy for streaming companies with amazon and netflix leading the pack. Details on what it would mean for those stocks. Chipotle ceo apologized or the today show. Why did he wait so long . Could the worst be over for the stock . A twitter turnaround possibly. The social giant showing investors how plans to generate more revenue. Bob peck will weigh in. When you do business everywhere, the challenges of keeping everyone working together can quickly become the only thing you think about. Thats where at t can help. At t has the tools and the network you need, to make working as one easier than ever. Virtually anywhere. Leaving you free to focus on what matters most. Some of these experimentsere notmay not work. Il. But a few might shape the future. Like turning algae into biofuel. New technology for capturing co2 emissions. And cars twice as efficient as the average car today. Ideas exxonmobil scientists are working on to make energy go further. No matter how many tries it takes. Energy lives here. Welcome back to fast money jetblue down 2 in afterhours trade. The airline expects flight shares as measured against capacity to fall in the Fourth Quarter from a year ago, partly due to Better Weather and operations that have led to fewer cancellations and higher capacity. The company added that the timing of yearend holidays compared with last year will hurt that measure of its business, and therefore, shares down 2. 7 after hours. Thank you very much. I always find the weather excuse a little bit funny and the holiday excuse. Did anybody not know the holidays were going to change this year . I would be concerned. Jetblue has been a phone normal performer. I find jetblue like apple. Love the product, dont like the stock particularly here. Jetblue, all the other airlines, even though oil is lower, when you start to see that capacity reduce, sorry, the passenger miles reduced, that is a concern, particularly jetblue gets a lot of feed from overseas. I would be a profit taker in jetblue and most airlines. Southwest had a rough week. I take the other side of jetblue. Weve seen this the last year or so after numbers like we are seeing now. Almost every time its been an opportunity to buy a stock on the dip. The one name that sticks out to my, god forbid another incident happens like we saw in paris, but it gave you an opportunity to buy priceline which valuationwise is relatively cheap in 19 times forward earnings. It bounced back nicely. Pcln is worth a look here at 1,300. Well stick with the airlines. Weve got a dose of good news for the sector in 2016 which kicks off our top trade. International air transport association released its Industry Outlook saying the sharp drop in oil prices and high demand for travel are expected to boost Airline Profits next year, putting out the number 36. 3 billion. That would be a record high. Its all about capacity. Its all about fewer players in the space. Thats been the story now. Youre finally getting Delta Airlines specifically back to levels we saw in january where we made alltime highs. Now its proven or not in terms of the airline trade. I think delta is right at a level where if youve been fortunate to be in the trade, youre taking profits here. It breaks out above 53. Jet plus on the other hand has been slow and steady wins the race. That is a name you can continue to own. How do you play it . Take profits, delta. Here is a problem with this report. This was put out by the airline association. Like asking a gold miner, what do you think the price of gold will do . It will be higher. Obviously. They put a number on it. They do size and scope. But the numbers are going to be biased towards this. We see jetblue and southwest come out with reductions in passenger miles. To me, i would not buy the stocks on this report. I would think its biased and probably wrong and you havent seen the benefits of lower oil. Nobody is going to mention united is giving back free snacks again . No. Dont mention it. Isnt that a plus . What is a good snack . I love gummy bears. Do they give gummy bears on a plane . No. Tomato juice. The only time i drink tomato juice is on an airplane. Its the only place you dont eat pepperoni, too. Golden globe nominations are out. Netflix and amazon saw strong showings. Netflix with nine nominations. Amazon with five nominations. For amazon in 2013 they had zero nominations. This is what everyone talks about. Amazon, theyre tech, retail, they are everything, streaming. You have to own this stock. If you think the market is going down, you sell amazon, you sell netflix. If you think the market continues higher, breadth is terrible in the market, you still buy the winners. These are the names you must be in. Interesting they are the top performers. Ive got to push back. Amazon, there is a price which you would say amazon is too expensive . I think we did that a couple of years ago. Bezos figured out how to turn that switch. Give you just enough profitability to scare the bears in the name. I had guys i covered that have bet against the stock, hundreds of dollars lower and refused to cover. That might be a small position, but there is never a price because it scares the heck out of a bear wanting to short it. He flips that switch and its up 100 day after earnings. You cant swallow that. At what price would you have bought amazon along the way . I probably wouldnt have and would have missed the whole thing. There are so many stocks you can say that about that ultimately come back to valuation. Would you buy netflix then . Not at this valuation. But netflix is actually, netflix is, i think, right in the heart of the change, the huge change of how we view content. Emsdplamazon is in the thin mar businesses of retake. If your premise is right, the whole year is missed. These are the names that rallied the most. Okay. You can have a year. If the market turns around and goes lower, you must exit these names. If it continues higher, thats why you have to have a short stock in this name. You buy it and you must sell it at a certain price and have conviction on that price. Netflix is up 152 this year. Amazon is up 113 . What steve is saying is fairly important if youre out there holding these names. These are crowded trades. Everybody is buying growth. All they care about is the stopline growth. These fang stocks are the four places you are in. When this cracks, everyone will run for the door at the same time. You want to make sure you have a very tight stop on this if youre in these names. These things will be down 5 , 7 like that. Do you own any, guy . Do you want to play that game . You play it on the new show youre going to host 5 00 a. M. Starting january. You can wake up early and play. Would you rather. I would rather sleep. Wouldnt you rhetter netflix amazon . I dont think it can be replicated yet. How can twitter monetize the loggedoff user . They may have found a solution. The stock is soaring. Youre watching fast money here on cnbc first in business worldwide. Here is whats coming up. Burrito bounceback. The ceo of chipotle breaking silence. Meg tirrell is mapping her human genome sequence. It could lead to the next big group of biotech breakout stocks. politely wait, wait, wait you cant put it in like that, you have to rinse it first. Thats bakedon alfredo. Bakedon . Its never gonna work. Dish issues . Trust your dishwasher with cascade platinum. It powers. Through. Your toughest stuckon food. Better than finish. Cascade. I think it might be troubling. If you cant identify the source, how do you eliminate it in the future . Unfortunately what got people sick was no longer in the system by the time they even showed symptoms. The Silver Lining comment is that it has caused us to put in place practices that our expert says will put us 10 to 15 years ahead of industry norms, and i believe this will be the safest restaurant to eat at. That was steve ells, chairman and coceo of chipotle. Trying to reassure customers and investors contaminated food outbreaks are a thing of the past. Did the ceo wait too long to address the media . Certainly investors like what they heard today. Its always good for the ceo to come out and apologize. Is it enough . No, its not enough. It was late. One thing he did do well is he seemed to have hired a food safety expert with a name that sounds suspicionusly like mine. That was a clever effort to repreempt me. Its better than silence. We had terrible models set by yum brands repeatedly at taco bell and kfc, jack in the box, terrible models on food safety in a number of fronts. Perhaps one of the worse was cocacolas delayed response. We complained about coke when they had a tainted product issue in brussels back in the 90s. The ceo waited a week. This ceo has waited five weeks to respond. He did do other things. He shut down 43 stores. Thats great. Its still spread. When he said weve gotten to the end of it, yes, maybe the initial 56 cases. Now we have another 122. Instead of being e. Coli, its a norovirus. It had to do with instore Safety Standards than tainted product coming in. Basically, we dont have control. When matt lauer says you dont have control of the problem, its false reassurance to say we fixed it. They dont even know whats wrong yet. There is a managerial response issue that is a problem. Jetblue, Oil Volatility<\/a> index is still above 50. Brian kelly outlined a number of times oil was headed down to 20. Its getting close. I still think the commodity is actually under pressure. Why the Stocks Holding<\/a> in there . I dont have a good answer other than fact people are saying oils got to be close to a bottom. I dont think the turns coming. Theyre expensive. Exxonmobil at 22 times forward earnings doesnt make sense in this environment. Neither does schlumberger. All those stocks are going to revisit august lows. If there are bigger implications for what we are seeing in commodities versus stocks . The price of oil versus the overall market has been closely correlated. The problem is some days its correlated, some days its not correlated. You cant trade off things one day are on, one day are off. To guys point, the only names that seem to rally are those big names, exxonmobils, chevrons. So the eogs of the world with. Although they are good position with acreage, they cant catch a bit. The only spot, refiners. Maybe some Service Names<\/a>. Even Service Names<\/a> have been under pressure, down 10 or so for the year. The only names you see that are up are the refiners. Theyre up big. In the 40s. Tesoro, valero. Did you buy any of those names . No. Clients have been buying. The problem is they are so under water they are adding to a lot of their positions that they already have caved in on. Thats the key. How many of these guys can survive the year with these positions that they hold. Are you trading any energy names . Im short oil. I have the view oil goes down to about 25 is where i think it ends up. I would not be buying any of these names. Weve seen this before. When you have a risk off type of environment where stocks like the fang stocks, amazon, netflix, google, those are starting to crack and people are covering their shorts in the oil space. Whether they are covering shorts or adding on to alreadylosing positions, i wouldnt necessarily call this people saying this is the bottom in oil. Certainly why not lets cover shorts here. If you were short these names, you did very well. Oil has a long way to go. Youll probably get one of those big spikedown days and know oil is making a bottom. There is an interesting article in the journal saying we are not seeing any benefit in the consumer names we would typically see from the price of oil hitting multiyear lows and the overall economy. I like retail stocks. Thats been frustrating to not see them shopping at the particular stores i like. They are at home depot and buying cars. They are saving. I always say thats not great, but it is good for the consumer at large to be saving money. I have thought for a while we would see more of that. I dont know. I dont think the American Consumer<\/a> is changing their stripes and not being the consumer any more. Yesterday we saw oil spike after that draw in oil. We saw it spike up to 38 and change. Today it closes 6 lower than where we saw a trade yesterday. You cannot call a bottom in oil with that volatility. Where did the pressure come from . Oil futures were down more than 10 since the opec meeting. Is that weighing on prices here . Yeah. There is no regulator on the oil any more. Weve got all kinds of oil coming online. Not only that, we have seen rig counts decline, but production hasnt climbed to any meaningful extent. Thats where i get my 25 number. That covers your operating costs. When you have opec out there, and opec estimates are lower than 25. Some people think they can operate 10 to 15. These are difficult numbers to put a pinpoint on because its well dependent. Point is, oil, when you have a price war and people are going to take it right down to their cash cost, right down to their operating costs, weve got a long way to go. Lets go to seema mody. El againy reducing its Quarterly Cash Dividend<\/a> to 8 cents from 18 cents saying Challenging Market<\/a> conditions impact our products. The stock is down 1 after hours on this news. Thanks very much. Seema mody at headquarters. What i would take from this is investors should take this and say its starting to spread a bit. We saw high yield, particularly in the oil patch with oil going lower. We saw those Companies Cut<\/a> their dividend. Now its in the material space in steel. The other areas showing distress are retail and some tech. I would be careful with higheryielding names. You may see dividends get cut in the next six months or so. Lets stick with energy. Conocophillips surging after announcing plans to cut its capital spend buying 25 . Morgan brennan at headquarters with the full story. Thats right. Conocophillips slashing Spending Energy<\/a> as Energy Prices<\/a> stay lower longer. Saying 2016 capex budget will be 7. 7 billion, down 25 from an expected 22 billion this year which has been revised three times lower this year. Down a hefty 55 from 2014. Its cutting operating costs again. Those are down 20 from 2014, arguably more aggressive than peers. Production slow growing. It expects to keep shedding noncore assets including up to 2 billion worth of sales in 2017 on an investor call executives reitting plans to maintain dividend. Chevron also announced 24 capex cut for next year. It has been a week of capex cuts. Thank you. Morgan brennan. For more on conocophillips, lets bring in the fast line. Pavel, good to talk to you again. Thank you. Do you take the ceo of conoco this week, today, and then chevron yesterday at their words that the dividends, no matter what is safe . In these two cases, yes. If we go back a year ago there were 16 sorry, 19 u. S. Oil and Gas Producers<\/a> that paid dividends. Today, 16 of them are still paying dividends. Thats only three companies, and chesapeake is the only large one of those that has suspended dividends. By and large, 1 1 2 years into the down turn, dividends held up pretty well. Thats because generally among the larger names, and conoco being among them, Balance Sheets<\/a> arent pretty. Conoco is not as good as chevron, but i think the dividend is safe in this case. Pavel, when they talk about the capex, what assumptions do you think are baked in for oil . Probably 45 for next year. On our model, we put in future pricing which is 45 wti. These guys should do 8 cap flow. Thats where you get the 8 billion capex. The dividend will still have to be borrowed. Or paid from asset sales either way. But at least the capex is being covered. This is the mantra now. I was on your show two days ago saying the mantra was live within your means. Thats why we are seeing even the largest players like these guys and chevron cutting capex 25 . Some smaller ones, murphy oil comes to mind, are cutting 60 . Thats for a second year in a row, i might add. The austerity on steroids across the industry is really kicking in. You said earlier Oil Production<\/a> has not yet rolled over. I probably debate you on that. It actually has rolled over in the u. S. And brazil, a few other places. Next year those production declines are only going to get steeper. Austerity on steroids is a good way to put it. Good to speak with you, pavel. Thanks for calling in tonight. How is that austerity on steroids if they are borrowing money to pay their dividend . Cutting their budgets and borrowing money . Thats greece. As a shareholder, dont you appreciate the dividend . Absolutely not because they are going to cut it. These dividends are not safe. Watch out. Kinder morgan, they cut their dividend, the stock traded up. For those names they felt the dividend was safer. There are many if they do cut the dividend the stock goes higher. Are some people looking at the european giants like bp who have said they are going to preserve their dividend, but some are wondering if they can do it. The bigger companies, bp is one of those flagged as far as what their leverage is and liabilities are. Bp seems like one that would probably not be in as much danger as a Smaller Player<\/a> with a lot more leverage. I think the whole place, the whole space is susceptible if Oil Continues<\/a> on this slide lower. You can look at the oil patch. I would look at some of the secondary third type of plays. For me, its dr horton. Big home builder in texas. Lots of exposure the last two quarters. They talked about weakness in their texas market. When talking about capex being spent, one persons savings is another persons profits. Dr horton at the highs of the year are very close to the highs of the year. At the least, i would be taking profits. Thinking of the big names. The one that is most scary is petrobras. It gets scarier all the time. The unintended consequences of our reckless fed is this easy money policies allows companies to do what bk was railing against, artificially creates dividends that shouldnt be there in the first place. Exactly. Transocean 19 times still expensive. Conocophillips and exxonmobil with oil going down are still expensive with these valuations. The fed is going to raise rates next week. Just to piggy back before we go to commercial, rdc down 25 yeartodate. 12 revenues from conoco. Nobody likes oil here at the table. Coming up, golden globe nominations going crazy for streaming companies with amazon and netflix leading the pack. Details on what it would mean for those stocks. Chipotle ceo apologized or the today show. Why did he wait so long . Could the worst be over for the stock . A twitter turnaround possibly. The social giant showing investors how plans to generate more revenue. Bob peck will weigh in. When you do business everywhere, the challenges of keeping everyone working together can quickly become the only thing you think about. Thats where at t can help. At t has the tools and the network you need, to make working as one easier than ever. Virtually anywhere. Leaving you free to focus on what matters most. Some of these experimentsere notmay not work. Il. But a few might shape the future. Like turning algae into biofuel. New technology for capturing co2 emissions. And cars twice as efficient as the average car today. Ideas exxonmobil scientists are working on to make energy go further. No matter how many tries it takes. Energy lives here. Welcome back to fast money jetblue down 2 in afterhours trade. The airline expects flight shares as measured against capacity to fall in the Fourth Quarter<\/a> from a year ago, partly due to Better Weather<\/a> and operations that have led to fewer cancellations and higher capacity. The company added that the timing of yearend holidays compared with last year will hurt that measure of its business, and therefore, shares down 2. 7 after hours. Thank you very much. I always find the weather excuse a little bit funny and the holiday excuse. Did anybody not know the holidays were going to change this year . I would be concerned. Jetblue has been a phone normal performer. I find jetblue like apple. Love the product, dont like the stock particularly here. Jetblue, all the other airlines, even though oil is lower, when you start to see that capacity reduce, sorry, the passenger miles reduced, that is a concern, particularly jetblue gets a lot of feed from overseas. I would be a profit taker in jetblue and most airlines. Southwest had a rough week. I take the other side of jetblue. Weve seen this the last year or so after numbers like we are seeing now. Almost every time its been an opportunity to buy a stock on the dip. The one name that sticks out to my, god forbid another incident happens like we saw in paris, but it gave you an opportunity to buy priceline which valuationwise is relatively cheap in 19 times forward earnings. It bounced back nicely. Pcln is worth a look here at 1,300. Well stick with the airlines. Weve got a dose of good news for the sector in 2016 which kicks off our top trade. International air transport association released its Industry Outlook<\/a> saying the sharp drop in oil prices and high demand for travel are expected to boost Airline Profits<\/a> next year, putting out the number 36. 3 billion. That would be a record high. Its all about capacity. Its all about fewer players in the space. Thats been the story now. Youre finally getting Delta Airlines<\/a> specifically back to levels we saw in january where we made alltime highs. Now its proven or not in terms of the airline trade. I think delta is right at a level where if youve been fortunate to be in the trade, youre taking profits here. It breaks out above 53. Jet plus on the other hand has been slow and steady wins the race. That is a name you can continue to own. How do you play it . Take profits, delta. Here is a problem with this report. This was put out by the airline association. Like asking a gold miner, what do you think the price of gold will do . It will be higher. Obviously. They put a number on it. They do size and scope. But the numbers are going to be biased towards this. We see jetblue and southwest come out with reductions in passenger miles. To me, i would not buy the stocks on this report. I would think its biased and probably wrong and you havent seen the benefits of lower oil. Nobody is going to mention united is giving back free snacks again . No. Dont mention it. Isnt that a plus . What is a good snack . I love gummy bears. Do they give gummy bears on a plane . No. Tomato juice. The only time i drink tomato juice is on an airplane. Its the only place you dont eat pepperoni, too. Golden globe nominations are out. Netflix and amazon saw strong showings. Netflix with nine nominations. Amazon with five nominations. For amazon in 2013 they had zero nominations. This is what everyone talks about. Amazon, theyre tech, retail, they are everything, streaming. You have to own this stock. If you think the market is going down, you sell amazon, you sell netflix. If you think the market continues higher, breadth is terrible in the market, you still buy the winners. These are the names you must be in. Interesting they are the top performers. Ive got to push back. Amazon, there is a price which you would say amazon is too expensive . I think we did that a couple of years ago. Bezos figured out how to turn that switch. Give you just enough profitability to scare the bears in the name. I had guys i covered that have bet against the stock, hundreds of dollars lower and refused to cover. That might be a small position, but there is never a price because it scares the heck out of a bear wanting to short it. He flips that switch and its up 100 day after earnings. You cant swallow that. At what price would you have bought amazon along the way . I probably wouldnt have and would have missed the whole thing. There are so many stocks you can say that about that ultimately come back to valuation. Would you buy netflix then . Not at this valuation. But netflix is actually, netflix is, i think, right in the heart of the change, the huge change of how we view content. Emsdplamazon is in the thin mar businesses of retake. If your premise is right, the whole year is missed. These are the names that rallied the most. Okay. You can have a year. If the market turns around and goes lower, you must exit these names. If it continues higher, thats why you have to have a short stock in this name. You buy it and you must sell it at a certain price and have conviction on that price. Netflix is up 152 this year. Amazon is up 113 . What steve is saying is fairly important if youre out there holding these names. These are crowded trades. Everybody is buying growth. All they care about is the stopline growth. These fang stocks are the four places you are in. When this cracks, everyone will run for the door at the same time. You want to make sure you have a very tight stop on this if youre in these names. These things will be down 5 , 7 like that. Do you own any, guy . Do you want to play that game . You play it on the new show youre going to host 5 00 a. M. Starting january. You can wake up early and play. Would you rather. I would rather sleep. Wouldnt you rhetter netflix amazon . I dont think it can be replicated yet. How can twitter monetize the loggedoff user . They may have found a solution. The stock is soaring. Youre watching fast money here on cnbc first in business worldwide. Here is whats coming up. Burrito bounceback. The ceo of chipotle breaking silence. Meg tirrell is mapping her human genome sequence. It could lead to the next big group of biotech breakout stocks. politely wait, wait, wait you cant put it in like that, you have to rinse it first. Thats bakedon alfredo. Bakedon . Its never gonna work. Dish issues . Trust your dishwasher with cascade platinum. It powers. Through. Your toughest stuckon food. Better than finish. Cascade. I think it might be troubling. If you cant identify the source, how do you eliminate it in the future . Unfortunately what got people sick was no longer in the system by the time they even showed symptoms. The Silver Lining<\/a> comment is that it has caused us to put in place practices that our expert says will put us 10 to 15 years ahead of industry norms, and i believe this will be the safest restaurant to eat at. That was steve ells, chairman and coceo of chipotle. Trying to reassure customers and investors contaminated food outbreaks are a thing of the past. Did the ceo wait too long to address the media . Certainly investors like what they heard today. Its always good for the ceo to come out and apologize. Is it enough . No, its not enough. It was late. One thing he did do well is he seemed to have hired a food safety expert with a name that sounds suspicionusly like mine. That was a clever effort to repreempt me. Its better than silence. We had terrible models set by yum brands repeatedly at taco bell and kfc, jack in the box, terrible models on food safety in a number of fronts. Perhaps one of the worse was cocacolas delayed response. We complained about coke when they had a tainted product issue in brussels back in the 90s. The ceo waited a week. This ceo has waited five weeks to respond. He did do other things. He shut down 43 stores. Thats great. Its still spread. When he said weve gotten to the end of it, yes, maybe the initial 56 cases. Now we have another 122. Instead of being e. Coli, its a norovirus. It had to do with instore Safety Standards<\/a> than tainted product coming in. Basically, we dont have control. When matt lauer says you dont have control of the problem, its false reassurance to say we fixed it. They dont even know whats wrong yet. There is a managerial response issue that is a problem. Jetblue, Carnival Cruise<\/a> lines or mattel that had product safety issues did it right. They formed industrywide coalitions and did a massive amount of research to diagnose what went wrong. They have reparations for damages for victims. These guys have done not even half of that. They did something. There is more they need to do. Its karen finerman. Say they are never able to figure out what happened what would you suggest they do . Theyve got to master that. Theyve got to figure out whats wrong with the sourcing. Basically, you need better than what the fda requires. Its very minimal standards in terms of safety. This is the department of agriculture in this case. They need to test their products and know their sources better. This is the brand at risk. Its like when google had a problem, whether or not they had Cyber Security<\/a> issues in china, if your brand is to do no harm in that case or this case that we are the safe, healthy alternative, and its not safe and they are saying because our food is fresher, people with processed foods had problems, too. Where is the stuff coming from . How is it being tested in the field on site . Not the cheapest, lowest standards. Right now standards are very low. If you have basically for chicken testing, its like one in 8,000 chickens, if they are contaminated, you can ship the whole lot. Its unbelievable. Jeff, just before we let you go, investors would want to know since you named a whole list of historical examples of Food Companies<\/a> this happened to in the past, how long did it take for them to recover . What reputational damage did they see in terms of sales . Great point. They did rebound within six months. Places who did it right, jetblue, they responded in six weeks. It took jack in the box a while. It did respond. Competition was different then. Right now competition is more fierce. Here the brand is more in danger. If theyre the healthy alternative, they have an added burden jack in the box did they never made those claims. Thank you and good to see you, Jeff Sonnenfeld<\/a> from yale university. Lets trade this one. Its crazy. Monday, big move dune to 5. 15 which was big volume. By the end of the day the stock closed around 5. 50. Headlines came out, boston college, stock sold off in the aftermarket down to 525. I bring this up because the lone 2014 and beginning of the year it was 500. We tested that on monday and bounced. You cannot deny that the price action in the stock this week has been outstanding. The other side of that, unfortunately, it trades at 33 times forward earnings, which is expensive. You know they have to Say Something<\/a> in terms of earnings coming up in february. I think at 575 given the run, its a notouch at best. Anybody want to buy this stock . No. Maybe in the 480s. The problem is what karen brought up. There could be a situation where they never find the problem. Then what do you do . I know certainly theres been times i walked past a chipotle recently, and after jeff talked about how chickens can be sent, im off chicken now. All chicken . How about eight people making a burrito. Stop the eight people touching a burrito. Maybe you should be a restaurant consultant. Better they do it in front of you. Who knows whats going on in the back . Did you ever see goodfellas . Watch the scene where they are making the heroes and what what they will do. Well leave that conversation there. Growth area and health care, the human genome sequencing. Who the big players are in this industry and what it means for health care in 2016. [sfx bell] [burke] its easy to buy insurance and forget about it. But the more you learn about your coverage, the more gaps you may find. [burke] like how you thought you were covered for this. [man] its a profound statement. [burke] but youre not even covered for this. [man] its a profound statement. [burke] or how you may be covered for this. [burke] but not for Something Like<\/a> this. [burke] talk to farmers and see what gaps could be hiding in your coverage. [sfx yeti noise] we are farmers bum pa dum, bum bum bum bum welcome back to fast money. Is apple ceo tim cook about to go on a major shopping spree . A top analyst names four different stocks the company should be buying. Plus shares of blackberry skyrocketing today. Traders are begt it really isnt over yet. All the details late they are hour. Weve got to start with twitter. Stock soaring after the social media giant says it will expand its ads to people looking at twitter but not logged into the service. That could be as many as 500 Million People<\/a> twitter could cash in on. Lets bring in bob peck. For a lot of bulls on this stock, theyve been waiting for this news. We think its big and changes the whole story from a network that only reaches about 300 Million People<\/a> a month to an additional 500. Thats 800 million. If the core starts to grow faster, youre talking about a reach of a billion people. This is critical not only for the users on wall street, but advertisers. They want scale. To hit a billion people is different than hitting 300 million. Dont they want information . Isnt the facebook sales pitch we know everything about our users, what they like, they dont like . If youre not logged in as a twitter user, twitter doesnt have access to what you like. We talk about the monetization would be half the rate. However, you have other signals in there. If its coming to search, they know what you were searching for. It will be some portion of the monetization what a core mau is. Youve got a 34 price target. Youre bullish. You think weve seen the worst of it for now . Expectations have become low. There is a whole series of catalysts about to kick in from finding tweets in google desktop search to monetization being a doubleclick. Periscope, vine, twitter audience platform. All these things are just starting to hit now. They set up for a good 16. We havent seen these in the numbers yet. We walked through all the lift on revenue ebitda you can get from this. We spent a considerable amount of time talking about jack dorsey, his beard, whether he can run two companies. Are we okay with him being the ceo . He shaved his beard. He spends a lot of time on his grooming habits. One thing you can see is the cadence of product releases including todays has picked up. You also see the cadence of monetization. He corrected the cost structure. He cut about 10 of the work force which was loaded. He also gave 1 3 of his stock back to employees so they could invest and participate in the growth of twitter. We think hes having a material impact. Bob peck, thanks for coming in. Youve been pounding the table how twitter can monetize the loggedoff user base. It feels like years weve been talking about this. The problem is the street basically sees what subs are. When jack dorsey was on the floor of the exchange for his ipo in square, i cornered him in a stairwell. Im surprised security didnt take me out. It was me, him and a couple of girls. Sounds like a much better story than this. I started asking what he plans on doing with twitter. He was really hopeful with it. I think it is going to be an instagram, i think it will be a youtube. Unfortunately the stock price is going against him right now will people jump into it . Maybe we start to talk about takeout target again. Maybe thats where it starts. I think the road is higher, not lower in twitter. You have a good risk reward here. 24 has been decent support. Trading 25 to 26. Youve got 2 down side. If you go to bob pecks price of 34, 10 up side, 2 down side, thats 51. Ill take that every day and twice on sunday. Everybody used to hate this stock. Its been so beaten up. From one growth stock, human genome sequencing could be a big player. Meg tirrell had her genome sequenced. What does that mean . What is that like . It was a little bit scary. Getting your genome sequenced means youre mapping all the dna that makes you you. 99. 9 of our genes are identical. Its in that 0. 1 that we are all different. That includes the way we look, whether we have athletic abilities and our predisposition to disease. That was what i was predominantly interested. I did it through lumina, the market leader. This is a market 2 billion to 3 billion a year. The question is in the future, is this going to become a routine part of medical care that Healthy People<\/a> will get their genome sequenced . Its not something Healthy People<\/a> usually do. Its used more in cancer care to sequence whats going on in a tumor or try to solve some medical mystery. Healthy people dont do it because its not clear how useful it is yet. Normally on stock therapy we talk about a nearterm catalyst, this is a longterm catalyst. If this does get adopted more broadly, companies could become incredibly massive. It tripled in the last five years. Market value is about 25 billion. There are Smaller Companies<\/a> in the space like pacific biosciences, Drug Companies<\/a> like roche. Its a big area, but probably only going to get bigger. How much does it cost . What i did cost 2,900. That kill you right there, wont it . And insurance probably wont cover there. Will or will not . Will not for Healthy People<\/a>. If you have a medical reason to do it, thats another question. Then there is more abbreviated consumer programs like 23 and me that costs 199. Right now they cant give you your predisposition to disease and health risks because the fda said hold on. We need to go through more rigor before you do that. They will give you your carrier status. If youre thinking about having kids, it includes some of the risks you could pass on to them. And fun things like how you process caffeine and whether you are a sprinter or mar on this runner. Are you buying green bananas or are you good . What . How did yours turn out . Green bananas. Sorry. You dont buy green bananas if you are going to die soon. I am buying green bananas. Im pretty healthy. My blood clots higher than other people. It means i only have a 0. 6 . Its absolute versus relative risk. In the future, people are talking about babies when they are born getting genome sequenced. If that happens, it will be a huge market. Thank you, meg. Sounds brave you did that. Illumina preannounced in october. It trades close to 50 times forward earnings with the selloff weve seen from 250 to current levels. This was probably the best piece of news theyve gotten in quite some time. The stock acting in kind. Given the valuation and given the length in which this will take place, youve got to stay away from illummia here. Would you consider genome . I want to know it all. Lay it on. Let me know. I already know im tall, goodlooking, what else can they tell me . Apple ceo tim cook is sitting on more than 200 billion in cash. That we know. Will the tech giant go shopping for the holidays . Four names one analyst says should be on his acquisition list. Much more coming up. trader vo i search. I research. I dig. And dig some more. Because, for me, the challenge of the search. Is almost as exciting as the thrill of the find. announcer at scottrade, we share your passion for trading. Thats why we rebuilt scottrade elite from the ground up including a proprietary momentum indicator that makes researching sectors and Industries Even<\/a> easier. Because at scottrade, our passion is to power yours. Youre watching fast money. Shares of adobe higher after reporting 22 rise in revenue helped by strong growth in two businesses. The ceo telling cnbc its International Expansion<\/a> is accelerating and that its photography plant continues to do well, specifically on the creative side. Shares up better than 4. 5 after hours. Beating High Expectations<\/a> there. Thank you. Adobe, is it a Company Apple<\/a> should be buying . One analyst published a provocative note what other Companies Apple<\/a> should buy with its 200 billion in cash. Welcome, dan. Adobe is interesting because we are looking at the valuation. Stock is up almost 30 in the last 12 months. Its trading more than 90 times trailing earnings. Why would apple buy a stock like this . You have to take a step back. Cook and apple are going through a make or break 2016. Really the focus on the enterprise. They need to get that from 10 revenue to 15 to 20 . Thats the nut they are looking to crack here. Adobe would fit in terms of from a digital and cloud perspective, proliferation of mobile devices, how they play into the enterprise in terms of creative. I view this as one that would definitely fit and really give them that avenue into the enterprise they really need at this point. Lets name other names on your list. Gopro was one. That on the other side has become cheap compared to its own valuations. You mentioned tesla. Which is the most likely here . I think gopro. Gopro and box are probably the two most likely. Gopro in terms of from actionable cameras, differentiation on smart phone, content is key. I think that would fit like a glove and really be something that would vault some of their initiatives. I also look at box. When we talk about the enterprise, its about on the storage side, taking that icloud going to more of the enterprise from the consumer. Box with the existing ibm partnership would be a natural acquisition. I would view it as one gopro, two box, adobe three. Tesla, we put that in as a longer shot. We talked about project titan, auto 2020, focused on thats really a big initiative. This would accelerate that. Its a little bit of a hail mary possibility. I think this is something they could go after. Ultimately, its the enterprise and the consumer. Box, adobe and gopro fit. Aside from tesla, any thought on whether the other three would have any interest in being acquired . When i look at gopro and box, they could say what they want, but ultimately they do, like everything, they have a price. Its more strategically where it could fit. Going into the apple echo system is something you want to do. You are going to get acquired. For box, how high could they take this . There are continuing competitive head winds. It would be a new initiative for apple to focus on the enterprise. What about the interest on apples part . The biggest acquisition would be beats. They dont buy outside Companies Like<\/a> this. Is there something changing . Its a great buy. The this is a pivotal time. 200 billion in cash. They need to build out these next growth frontiers which they dont have. I think its a game of high stake poker and they go for a big acquisition 2016. Thanks for coming on to talk about your note. Lets trade it. You are probably better off buying one of the names he thinks will be taken over than apple. They are not an acquisitive company. For me, i would never buy a stock just thinking somebody is going to take them out. I would be concerned apple is biting off too much here. I still love apples products, im not a buyer of the stock. When it comes to box and gopro, those two i would stay away from. Tesla, im probably a buyer. But below 200. I dont think that is a car company is that an energy company. Box makes total sense if going for the enterprise angle. Gopro, theyve got to call it iphone indestructible. This is what samsung is pitching, this phone that is indestructible. Then come out with other accessories and make their own gopro. Thats the next thing apple should come out with, a phone that would get buy a 10yearold. Thats their play book, they make their own hardware. If they get indestructible. Shares of blackberry rallying 7 . Some traders betting more gains are on the way. Attention inves vectorvest mobile is here and its free make faster, smarter, better trading decisions with vectorvest mobile. The most powerful app or managing your portfolio from the palm of your hand. Only vectorvest mobile analyzes, ranks and graphs. Over 16,000 stocks worldwide, everyday,. And gives you clear buy, sell, hold recommendations. On every stock; anytime, anywhere. Vectorvest mobile comes free with your vectorvest trial. Get it now visit vectorvest. Com mobile to get started cto everything from surfers welcomingto seals. Ul home attracting visitors from around the world, around the year. Along the coast, protected areas are set aside to preserve a Fragile Community<\/a> of animals and plants. To protect these natural wonders, heres what to know before you go. Stay at least 300 feet away from seals. This is their home. Dont touch marine life in tide pools. Take away your trash and your happy memories. Always enjoy and protect our marine habitats. Blackberry shares up 7 today. Some traders think the stock has room to run. We saw five times the average daily options volume in blackberry today. Even though puts were actually the single most active option, on balance there were more bullish bets than bearish ones. The most active was on the eight strike that expires the end of the week. That would suggest the stock would be up about another 7 by the end of the week. Also agent active march 9. They are looking further out and further up. Well see what happens. Youll talk about it tomorrow on options action. Up next, traders tell what you they are watching tomorrow. Here at td ameritrade, they work hard. Wow, that was random. Random . No its all about understanding patterns like the mail guy at 3 12 every day or jerry, getting dumped every third tuesday. This happens every third tuesday. We have Pattern Recognition Technology<\/a> on any chart, plus over 300 customizable studies to help you anticipate potential price movement. Theres no way to predict that. For all the confidence you need. Td ameritrade. You got this. Finally, fast but not least is tim seymour okay after we challenged him to eat a chipotle burrito . Tim is fine. Hell be back on the show tomorrow. We asked you on twitter if you could eat a chipotle burrito. More than 650 responded. 33 of you said yes. 48 said no. About 19 of you said maybe later. Its time for the final trade. Lets go around the horn. American eagle. In the retail space. Aeo up 15 yeartodate. Look far and long to find a retail stock thats up that much. It rebounded right off that retail selloff. Aeo long. Got to start thinking about the fomc meeting next week. Tlt wants to break out. Buy that. I like bank of america. The stress test passed. Wasnt perfect, but good enough. Sara eisen, good luck with that new show in january. You are going to crush it. Thanks for being here tonight. The movie was casino not goodfellas. Sorry. How do you mix those two up . You can catch fast money 5 00 p. M. Eastern time tomorrow. Mad money with jim cramer begins right now. My mission is simple. To make you money. Im here to level the Playing Field<\/a> for all investors. Theres always a bull market somewhere. I promise to help you find it. Mad money starts now. Hey im cramer. Welcome to mad money. Welcome to cramerica. Other people want to make friends. Im just trying to make you some money. My job is not just to entertain you but educate and teach you. So call me or tweet m me jimcramer. The one and done crowd has taken over. The broad consensus is now that when the Federal Reserve<\/a> takes action next week its going to say this hike will be our lt","publisher":{"@type":"Organization","name":"archive.org","logo":{"@type":"ImageObject","width":"800","height":"600","url":"\/\/ia801304.us.archive.org\/20\/items\/CNBC_20151210_220000_Fast_Money\/CNBC_20151210_220000_Fast_Money.thumbs\/CNBC_20151210_220000_Fast_Money_000001.jpg"}},"autauthor":{"@type":"Organization"},"author":{"sameAs":"archive.org","name":"archive.org"}}],"coverageEndTime":"20240623T12:35:10+00:00"}