Giant. Plus, courtroom grilling the Trump Administration defending its use of executive power and the travel ban before a federal Appeals Court. Social medias in focus. Facebook and twitter getting some upgrades ahead of earnings tomorrow. First up though, a bunch of earnings to get to, time warner a beat on both the top and bottom line. Alaska air also beating the street announcing an increase in the Quarterly Dividend ahead of the meeting with airline ceos at the white house tomorrow. Big report focused on is disney, revenue falls short of consensus, rising costs as we said, declining viewership at espn weighing on the results. Here is bob iger last night talking to our Julia Boorstin. I think theres way too much pessimism about espn because espn is still in demand from three constituents you want to be in demand the most from, one, distributors, two, consumers, and three, advertisers. And the reason its in demand is the brand is still strong, the product is still good. Weve invested nicely to keep that product as high quality as possible. Cable revenue down 2, opera net down 11 all with espn despite what iger says. Preponderance of the evidence says you cant sell the stock because youve got this brand new pandora, the new theme park that if you have kids youre listening saying i havent visited that, i want to go back. Youve got this incredible movie schedule. These 800 million franchises, theyre terrific. He talks about derisking the movie business, which everyone would love to do. Bewkes has tried to do that. But i think the most important thing is he just literally just wont go there when it comes to anything espn other than stay tuned were going to be a Technology Company with bamtech. Mentioned that several times. In the end he said if youre so worried about espn, you really havent figured out the disney story. Even to the point where he says that if its a skinny bundle, there will be more money leftover to buy more disney products. Wait, what . Yeah. You get that part of the call he says the skinny bundle its good, there will be more money leftover and people will buy some other disney stuff. Right. Its kind of surreal in the sense that that was the one where i just said he is saying to you, okay, look, go ahead, make my day, sell espn, sell it on espn. I will buy back more than i already have 15 million shares at 1. 5 billion, i will buy back 7 billion to 8 billion, i will continue to buy back stock, ive got the cash flow, you really dont know what youre doing. Youre focused on espn, you dont get it. This is a theme park that has also this great cable business. And just shut up. Right. But its not working really. Well, actually well, its working. In some ways it is. The stock has performed well. There is houdini thing going on here . You do . You think its more about magic. Magic kingdom. It is the Magic Kingdom. Not the tragic kingdom. No. I felt the key number to the Magic Kingdom because you had this hurricane matthew, im not being facetious, they had 7 per capita growth for people to the extent there was a miss the hurricane was probably responsible. Right. I come back and i say i want to believe that this espn Technology Issue will make it so that we stop one day thinking about espn. In the interim he makes it so hard to sell. Theres so many good things coming. China by the way shanghai sold out. But everyone was talking about espn. But what im saying is hes saying thats not the narrative and grow up. Right. Journal this morning says the deals in the works with youtube and that channel coming up pretty soon here. He says we do not need to make an acquisition to accomplish what we need to in digital. And as far as comps go, hard to come off a year where the force Awakens Makes 2 billion and rogue one only makes one. Yeah, year over year comps were tough for them no doubt. On that, on the studio front. I have to tell you, disney animation marvell, lucas films, they make movie, tide, gillette, pampers and crest, they keep pumping. Theres derisking the film business. They do. But back to the Bigger Picture here which weve been discussing for the last couple of years which is, i mean, right now youve got directvs over the top offer. Right. Youve got the one from sling which was really the first out. Youve got hulu soon to be launched. Lets call it march, i believe is hulu. Youtube, which the journal says is actually a deal that iger was referring to but did not by name. And so many others coming. This is going to break a par through to traditional bundle. It may take time, but it is happening. Every one of these guys tells you not to worry were going to be on all of them. I dont believe it. The stock is saying dont worry. I dont believe that given the high price youre going to be on every single one of these over the top bundles. Theres going to be some that may be entertainment focused because not everybodys a sports fan and doesnt want to pay that much. Down 2 in the headline number and when you listen to iger you start feeling good and then you start feeling fabulous and then you say would you please book my ticket for the new theme park. David, its a little more atherial, a little more mindful than you feel about. I quote, the cable bundle was gods gift to disney. They are never going to replicate something that is that profitable. You disagree . Look, espn was unbelievable as long as it lasted. In the interim they have franchises that just generate a huge amount of capital. They do. They have incredible franchises. We love i love going to disney. Ill just keep going even as my kids age out. There you go. Six times for me. Its the best. Right. Shanghai seems to be doing well. Theyve got an incredible movie studio. But if youre going to tell me that the stock price does not reflect the contribution of its Cable Networks led by espn and that theres not going to be continued con stern nation amongst investors, come on, man . How about bamtech . Oh, will you stop with the bamtech . Thats all you ever hear from him bamtech. [ laughter ] im just going to let that hang. Me too. Bam. The conversation last night did pivot on some macro issues, specifically Corporate Tax. Heres what iger had to say about that. I think a real strong or Good Opportunity to be the sole representative of our industry a number of very important issues, intellectual property protection, traderelated issues, specifically for disney obviously any changes in the tax law could have a profound impact on our bottom line. The Corporate Tax rate is the highest in the world and we pay, you know, very high Corporate Tax rate. And believe it is time for that to be reexamined and that could potentially be a real boom to the walt disney company. Helps us pivot to the debate over Corporate Tax. Steve forbes on squawk this morning calling border adjustment insane. Yeah, i think that border adjustment just depends on the day about how insane it is versus not, but this 2018 analysis is making people say they want to stay with disney. The cash flows big. Look, im not denying that espn its like when i listen to it i said, wow, this is really going to hurt. But at the same time the multiples been shrinking. They do have a lot of cash flow. Were short the number of were short senior Growth Stocks away from tech. Time warner is going away which was a class senior growth stock so were defaulting to disney. We cant use nike anymore. Starbucks is challenged by the mobile making it so theres a mosh pit by the way panera solved. So i come back and say, all right, you know what, its not as great as id like, but its still better than the other guys. Thats how im looking at it, okay . How about that . I like that. Do you like that . Absolutely. Listen, stocks been moving the way you said it would. Thank you. Youre welcome. When it was down two bucks i was saying i wish mad money were live i would go buy it because i absolutely love its so great he makes espn as a total throwaway. I was waiting for him to say, hey, by the way, i wish chris berman the best. It was so not a factor. Analysts want to keep bringing it back, and i totally understand, david, it should be the factor, but he did make you feel im going to the theme park spending a fortune. This is unbelievable. Hes got these other things while he figures out how to deal with the decline of espn. He gives you a gap and then 2018 got taxes, he gives you a reason not to sell. Do i think the stock should be up . I mean thats kind of unbelievable. Gives you reason you feel like a chump. Got it. If youre a longterm shareholder you feel like a chump. Hi ho hi ho im not a seller. The seven dwarves are were going to see how it affects the dow at the open for sure. Meanwhile, the fight over the president s travel ban continues as this Appeals Court approaches Justice Department order on whether the order is discriminatory. Judges from the ninth Circuit Court of appeals did not make a decision buzz said ruling should come this week. The president tweet ths morning, if the u. S. Does not win this case as it so obviously should we can never have the safety entitled setting up the judiciary as a fall guy if there is any attack, jim. I know this is kind of on the throwback. These are distinguished jurists trying to discuss this on the merits. The questions i felt were very realistic. Theyre trying to really drill down in a way that is very empirical and very emotionless. And i dont think an emotional appeal by the president of the United States is going to play a role in the decision that he wants. Argue it on the merits. If the merits are as he says, hes going to win. Justice said no harm to the state, potus has broad discretion when it comes to national security. Its not religious based, right . Obviously things that Washington State and minnesota disagree with. Now does it go to the Supreme Court . The Supreme Court split. I just think in the end not that im an advisor to the president because i most certainly am not, unlike ker ri and homeland i think theres absolutely no edge to bullying. And thats what i think hes doing. The federal judiciary. Do you think these tweets are undermining the judiciary . Yes. Bingo. This is not what i would do. I would say, listen, you know what, let the chips fall, but we know which way they should fall. Kind of like when you have socalled judge, judiciary, theyre united in the concept of what they do for a living. Which is keep a check on the executive branch. You made that point yesterday. So i just no more tweets, mr. President. Youre killing the case here, man. Theres a sense that a lot of this is going to end up in the courts being certain parts of the trump agenda so this may not be the last time. Do you know any federal judges . I do, actually. I know one. Do you like it they were called socalled . No. Shes a very capable person. Yeah. It rankles them. Yes. He hasnt called them clowns. That is he hasnt called them clowns. That maybe comes for when he loses. But i just feel like this is just playing with fire. Theres a way to win, you speak softly and let the judiciary carry the big stick. Anyway, i just read these tweets and say, oh, man, these federal judges probably calling each other saying listen we cant have this. We got to shut this downright now. Perhaps the good news is the viewership on the streaming of the hearings last night unbelievable. Cable networks, i mean americans actively listening into the intricacies of our judicial process. Bad news travel numbers are way up. When we come back, a lot more on facebook and twitter and how snaps upcoming ipo may affect those companies. Upgrades for both of those. Today on mad money dont miss jims exclusive with jeff immelt of general electric. Look at the premarket, s p is up four of five, dow alternating between losses and gains for six straight days. Back in a minute. Is it because so many go after it the same way . Chasing after short term returns. Instead if getting caught up with the crowd, the Investment Managers at pgim take a long term view, teaming specialized active investing with riskmanagement rigor, to seek out global opportunities. We manage over a trillion dollars this way, attracting many of the worlds leading investors. Partner with pgim. The Global Investment management businesses of prudential two interesting calls this morning, b of a adds facebook to its u. S. 1 list making itd top pick in internet media and btig upgrades twitter noting daily active users. Reports earnings tomorrow morning before the bell. On the b of a calls they say we came into the year with three concerns on facebook, expenses, ad load and snap. They say the first two have been well telegraphed and snaps filing shows not as big of a threat as they might have thought. Yeah, i really think the big decline that day was for facebook when it touched 130 was a realization that holy cow snaps coming out and snaps going to blow away because they didnt really understand the impact of instagram stories, which is an exact crib, i think, of snap. What i liked about this upgrade to focus 1 list was it gave you some numbers. I want to compare this to 1999 when you have Something Like seth saying stocks are overvalued. Heres facebook selling at, im not going to use the nongap number, david, because i know we dont like nongap. Right. In gap its selling at 22 times 2018 numbers. Now, i have i literally have 499 Companies Growing slower than facebook that have multiples that are comparable. Yeah. And thats just not right. So, i mean, this is an inexpensive growth stock is what i come back and say. Why does it stay inexpensive . I think because people feel in the end its an Advertising Company and theres no way an Advertising Company can really grow beyond that. Thats the same reason why i think alphabet has capped. Facebook can do virtual reality, but thats not a needle mover. In the end if you are someone that has to spend a lot of money on data centers, spend a lot of money on whatsapp, do a lot of what i regard as being things that make it so you have more viewers but not pay viewers, that in the end youre stuck with the four walls of will advertisers keep advertising. Right. Alphabets multiple is similar, right . Yeah. 20s . Yeah. And then obviously it is interesting to note three of the largest market Cap Companies in the world really trade at multiples versus their growth rates apple being the other one, that are and have been and continue to be low. Thank you. Because you know all day today i was trying to figure out what the top of my show should be. Thank you. Youre welcome. I know you dont get it youre busy walking the dog, but thats it. I want to compare these to the multiples of stocks in 1999, the three largest cap stocks. These are companies that are valued at less than one of my absolute favorites clorox. Microsoft, cisco and ge were probably your three top in 99. You were watching. A 95 multiple, remember that . Cisco had like an 80 multiple. Wow. So were going to examine that about how valuations are perilously high. And i come back and i say you know what, i look at these multiples and i say, geez, ges more expensive. As for twitter, as we said earlier First Time Buy rating for btig on that name 25 target. They talk about daus, i think they are hinting theres a potus element here. Yeah, potus bump. Definitely potus bump. Hard to disagree with that. One of the things with twitter people cant figure out is it a takeover stock, is it a company thats on the make . Right. Or is it just not a really Large Company and happens to have a president that really likes it. Its all those things, right . 13 billion market value. Where would it be without no, its got the president. Lets say someone took away a lot of hedge funds have been talking lately about maybe a bit of a rebound coming, engagement and active users. He talks to a lot of them. I feel like for my users there was an acceleration in the last month. Definitely an acceleration, for what its worth. Not that im the, you know, im anecdotal. But i feel like people feel like they have to check what the president s saying. And its like for every failing new york times, just the president page view thats lost they go to twitter. I just wish i mean, twitters not going to replace argue say in front of the Supreme Court. You know who has a million followers now . Who . Jim cramer. Wow. Crossed the one million mark overnight. Take a look. Thank you. Thats impressive. You think so . I do. My wife said, good, are you done, you idiot . This thing distracts us, its meaningless, someone says something bad, youre upset. Just done. Just call it finished. Lisa says thats it. She doesnt watch the show, so i dont have to necessarily end it. But that was it. She said last night we were actually with a friend in tech, said hes going to quit right now because i am tired of him talking to them and not me. Sounds like a reasonable we are proud of you. The wife wins. We love seeing it. Congratulations by the way. Well get cramers mad dash. Well count down to the opening bell after the break. Opportunities arent always obvious. Sometimes they just drop in. Cme group can help you navigate risks and capture opportunities. We enable you to reach Global Markets and drive forward with broader possibilities. Cme group how the world advances. Hey nicole. Hey i just wanted to thank your support team for walking me through my First Options trade. We only do it for everyone gary. Well, i feel pretty smart. Well, were all about educating people on options strategies. Well, dont worry, i wont let this accomplishment go to my head. Im still the same old gary. Wait, you forgot your french dictionary. Oh, mucho gracias. Get help on options trading with thinkorswim, only at td ameritrade. Back for mad dash. Of course ahead of trading on this wednesday. It is wednesday, right . Hump day. Thank you. Gilead is a name i always en