← CNBC's "Fast Money"
CNBC's "Fast Money"
Cerebras Surges In Nasdaq Debut… And Wheelin’ & Dealin’ In China 5/14/26
00:43:24
Shares of AI chipmaker Cerebras surging in its Nasdaq debut, topping $100 billion in market cap after a blockbuster IPO. How the rest of tech fared in today’s rally, and how the Fast Money traders are positioning in the group. Plus Applied Materials reports results, Biogen pushes ahead despite disappointing drug data, and the latest out of President Trump’s China trip. The CEOs and companies able to leave the mainland with a deal. Fast Money Disclaimer
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- [00:00]
Narrator/Announcer
What does it mean to live a rich life? It means brave first leaps, tearful goodbyes and everything in between. With over 100 years experience navigating the ups and downs of the market and of life, your Edward Jones financial advisor will be there to help you move ahead with confidence. Because with all you've done to find your rich, we'll do all we can to help you keep enjoying it. Edward Jones Member, SIPC Is your business achieving its current strategic goals? Are operations as tight as they should be? Are finances in a realistic place for expansion? These are questions investors ask. That's why EY Parthenon brings an investor mindset to help executives reinvent business models for long term growth, reset strategic goals, optimize operations and get finances in order. Let us help you reimagine your enterprise EY Parthenon solutions that work in practice, not just on paper.
- [01:02]
Melissa Lee
Live from the NASDAQ markets and in the heart of New York City's Times Square, this is fast money. Here's what's on tap tonight. Cerebral soars, the chip maker jumping nearly 70% in its market debut. All the details on the high demand IPO and what it says about the state of the air race in dealmaking in Beijing. President Trump saying China has agreed to buy 200 Boeing planes. Round up all the agreements getting inked and what it could mean for trade between the two economic giants. Plus, Biogen drops on its latest trial results. Ford revs up for a second straight day and Coinbase mints some gains as Bitcoin nears 82k. Did we get some real clarity for the crypto space and will it be off to the races from here? I'm Melissa Lee, come to you live from Studio B at the nasdaq. On the desk tonight, Tim Seymour, Carter Braxton Worth, Guy Adami and Stuart Kaiser, head of equity trading strategy at Citigroup. On a day where The Dow reclaimed 50k and the S&P close above 7,500 for the first time ever, it was tech in the driver's seat. By far the best performing sector in the S&P 500 up almost 2% trading at all time highs. The NASDAQ leading major averages with a gain of nearly 1% in semis. Extending their run, the SMH now set to close out a seventh straight winning week. Nvidia playing a big part in boosting that group up over 4% today. Now on a seven day winning streak. It closed the day with a market cap over $5.7 trillion. Cisco also powering today's move the biggest gain on the S and P after last night's earnings showed skyrocketing AI demand. That stock had its best day going back 15 years. But much of today's euphor tied to the biggest US tech IPO in years. Cerebra. Shares of the AI chip maker closing up 68% at $311 a share. The stock pricing at already above range of 185 and opened at 350. For more on the debut what it means for the chip trade, let's bring in Christina Parts and Evolis. What an exciting day today here.
- [02:52]
Christina Parts
I know there's lots. First it was Nvidia and now just Cerebus. You talked about pricing. It was 185 raised twice. It went up to a high of about 385 bucks today. And if you were to take all outstanding shares in the that puts a valuation of roughly $117 billion, then divide that by just last year's revenue of only 510 million. And you're talking, and I know you like ratios, you're nodding 220 times, 29 times. And hats off to Ben to Highline Capital. Just he provided that set. And so what that tells you is a lot of concern about just, you know, whether this is a little bit frothy. This is a company that makes the largest commercial chip available. It's really big. I even held it on screen earlier. So. And it's putting everything on that actual tip. That's how it differs from, let's say the likes of nv, where there's a lot of smaller chips pieced together, which makes it more complicated because you have to use advanced packaging and that's how you could lose some data. And so with that, they're saying that they're able to save money on the memory front because it's on the actual chip. You're not losing that speed. And so it's an opportunity for the company to grow dramatically. It's just a matter of are they relying solely on just a few customers? Which I know you brought up OpenAI. There's the UAE, maybe AWS. We still don't know the terms of that deal. We won't get the details until the second half of this year.
- [04:05]
Melissa Lee
What is your sense of if they are able to meet the demand, should the demand be should those other customers come through? Which was what that benchmark partner had said.
- [04:14]
Christina Parts
Should they come through?
- [04:15]
Melissa Lee
Should they come through?
- [04:16]
Christina Parts
I asked one of the executives right after the big, you know, hurrah about that customer concentration and she's like, well, can you even say that? That's like an old way to refer to companies now with concentration when the hyperscalers really account for so much of that capex spending anyway. So everybody has a relative concentration. The person threw it into three buckets. They have labs OpenAI, they're catering to that. They have the nations UAE catering to that. To that. And then the third one which would be the cloud, which is aws, which we still don't know. The problem is, is the revenue. Morgan Stanley seeing about 15 a billion in the next three years, going from 510 million to 15. That's a pretty dramatic increase. And a lot of that though is OpenAI. The backlog is right, $24.5 billion. OpenAI signed 20 billion. So there's still that risk, no doubt. And they would have to keep up that growth trajectory and get TSMC capacity. You asked me that just a few days ago. So yes, it's an issue for so many chip makers.
- [05:13]
Melissa Lee
Absolutely. Christina. Thanks. Christina. Parts nevilless Breaking it down. Breaking it down. As she always does.
- [05:18]
Tim Seymour
As she does.
- [05:19]
Melissa Lee
What'd you make of the trade today?
- [05:20]
Tim Seymour
Well, Brad Gerstner, who is as enthusiastic a person around this space as there is, I mean he said anything over $250 today is little exuberant in his words, not mine. So here we are. And you know, again, I'm not going to get into how things are priced and if it was priced well or not, but for this to go up a hundred percent during the day, I mean that's pretty extraordinary. Based on where it was priced and based on where it traded up to today, price of sales is concerning. But if you think this is going to be instead of a billion dollar revenue company, a $20 billion revenue over the next three or four years, you're going to play the waiting game and say, you know, I'm not going to wait around for this to happen. I'm going to get in front of it. I think it's overextended here in terms of those valuations. I think it's just a matter of time before we go back to the price that was priced at today.
- [05:59]
Guy Adami
Well, if you think about just the backdrop of where we are, first of all, this is not only the biggest IPO of the year, it's the biggest semi, you know, semiconductor IPO ever. And therefore there's a lot around this at a time when there's a lot going on on a day we've got more clarity about the prospectus of SpaceX which is going to be, you know, maybe 1.2 trillion. So it doesn't surprise me that we had this runaway. We are in an environment where, you know, retail has barely just gotten their chops onto this thing. And this is also a slightly different. Like when you're into kind of this large size semiconductor chip story and everything around it, which has been everything from engineering dynamics to power Dynamics to at the same time, speed and places where this really could be the brave new frontier, doesn't surprise me. We had this reaction. In fact, I kind of looked up at my screens and said, huh? Like, you know, I don't know where it's going to be. I don't know that the market has any idea what price to sales multiple you should put a stock like this at.
- [06:59]
Melissa Lee
I feel like you can apply that sentence to a lot of parts of the AI trade at this point. And if you are a believer, then memory is in shortage. You gotta be a believer in Cerebrus. I mean, part of their existence is just working around that loss of memory. Memory scarcity here. So here we have the perfect sort of entry into this chip frenzy that we're seeing.
- [07:20]
Stuart Kaiser
I agree. Perfect storm. I mean, memory in our view is probably the tightest bottleneck within the AI trade. You haven't had an IPO really in a couple months because of the Iran disruptions. To your point though, this is the biggest IPO of the year so far. I mean, we've got two or three coming that are going to kind of dwarf this in size. And that's probably why they wanted to get it done now, to kind of get ahead of that SpaceX demand as well. But to your point, it hits all the boxes. We're a big fan of the AI bottleneck trade, whether that's memory, whether that's cloud, whether that's power generation. And this kind of slides right in there. And it ticks a lot of retail boxes too, which helps.
- [07:51]
Melissa Lee
I know you can't look at the cerebral stores.
- [07:53]
Carter Braxton Worth
No chart to look at. And you can't call it extended because there's nothing to be extended above or below. It is what it is. It's just a time. But the thing that's so telling is the environment we're in. It was repriced twice, 20 times oversubscribed. Originally it was like 115 to 125, they moved up to 150, 160 came out at 180. And this is the tape we're in. There is no valuation, it is all on the come. So from here it's just there are people who exit day one like the people who went and sold the public. There are people who are in on the IPO who will be happy to book it and go, and there are people who are buying it fresh and new in the open market.
- [08:27]
Guy Adami
We call them flippers.
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Carter Braxton Worth
We call them flippers.
- [08:29]
Stuart Kaiser
Flippers.
- [08:30]
Guy Adami
Yeah. Not the dolphin. But, you know, that was a sweet show.
- [08:33]
Tim Seymour
Remember that? That was cute.
- [08:34]
Guy Adami
I like Flipper.
- [08:35]
Tim Seymour
I can sing the song.
- [08:36]
Melissa Lee
Is that the one with Gidget?
- [08:37]
Tim Seymour
No, no, no, no, no.
- [08:38]
Guy Adami
I might have been last.
- [08:39]
Melissa Lee
I don't know. Sorry, I'm not up on the 60s TV.
- [08:45]
Tim Seymour
Nor should you be. So Tim's earlier point, I mean, if people listen to somebody like me and it's me specifically talking about Nvidia price to sales for years, they would have missed out on what has been an epic run. And I think for me to say price to sales is extended here. It is extended. But people say, you know what, you made that mistake a number of times in different companies. It's going to grow into it and we're not going to wait around for that to happen.
- [09:07]
Melissa Lee
All right, but in this environment, would you rather.
- [09:09]
Guy Adami
Okay, here we go.
- [09:10]
Melissa Lee
Memory or Cerebras? Let's just say Mu.
- [09:13]
Guy Adami
Memory.
- [09:14]
Melissa Lee
Memory.
- [09:16]
Guy Adami
I feel like we've got enough data points and we know kind of how this works. And I also look at the market as a discounting mechanism at six to nine months and we haven't started to do that yet. I don't like, I believe Samsung and Hynix when they tell me there's nothing coming online in terms of new supply until the end of next year. That what we don't know is truly what's going to happen in terms of the efficiency of these chips. I mean, there is an element of less memory, maybe more. I mean, today is again, guy size matters, apparently. And today is a day when in chip land, size might equal less requirements on memory. So. But you just asked me, I won't belabor the point. Memory.
- [09:55]
Melissa Lee
All right, same to, same to you. But also realizing that when Nvidia launches the Vera Rubin chip, that could be a real competitor to what Cerebres is, you know, has out on the market at this point.
- [10:07]
Tim Seymour
Yeah.
- [10:07]
Stuart Kaiser
And look, we love the memory trade. Power generation is, we think, the best Sharpe ratio way, you know, to kind of go after the AI trades. If I had to pick a bottleneck, I'd personally go with that. But, you know, our research team, Heath, Terry, et cetera, they view memory as the tightest bottleneck. So if you're looking for a bottleneck trade, go there and you can look at the price of Korea and you'll see that pretty clear.
- [10:23]
Melissa Lee
Yeah, absolutely.
- [10:24]
Carter Braxton Worth
So let's say it was a little bit different. Let's say it had come out at the midpoint at 120.
- [10:27]
Melissa Lee
Okay.
- [10:27]
Carter Braxton Worth
Where it was originally priced, and we were sitting here two months from now or two weeks, it's now up 50% to 180. It's been trading. Well. Would you rather. I think is. Would you rather have this for the next six months or cash? I think the answer is cash.
- [10:40]
Melissa Lee
Cash, yeah.
- [10:41]
Tim Seymour
Bold.
- [10:42]
Melissa Lee
That is bold.
- [10:44]
Tim Seymour
You know, the power generation. Carter's always bold. Power generation, to Stuart's point. I mean, Caterpillar is in that world. And, you know, you can say it's trading like a biotech stock. It is. But, you know, if you look at what they do on the power gen side, it actually sort of makes sense. I know if Dan were here, he'd be rolling his eyes on me and maybe correctly so. But I gotta tell you something. At 32 times next year's number, given the space that they're playing in, it's not ridiculous to think these stocks can still go higher.
- [11:08]
Melissa Lee
All right, for more on the Cerebras ipo, let's bring in Gil Lauria, head of technology research at DA Davidson. Gil, great to have you with us. You don't officially cover it yet, correct?
- [11:18]
Gil Lauria
Correct.
- [11:19]
Melissa Lee
Okay. I read the note that you put out, though it sounds like you're a skeptic, to say the least. You said 115 is where it should be trading.
- [11:29]
Gil Lauria
Yeah, I mean, I. I hate to rain on parades. Right. It's a great day for the market. It's a great day for early investors, for folks that got allocation today. Congratulations to all those hardworking folks that have been working on this for a while. And I don't want to. I don't want to temper that too much. Having said that, we do have. This is about speed, right? So the bull case here is that Cerebras makes the equivalent of somewhere between a Ferrari and a Bugatti. So for some uses, you're going to want to pay a very big premium for speed, which is what it's going to take, because to run a big model on Cerebras, you actually have to string 45 of these together, which is about $100 million installation. So it's going to be very expensive per token. And that's the bull case is there's a market for Bugattis And Ferraris and Cerebras will get to capture that. And it's a unique property because their engineering is very unique and they've worked through a lot of problems. The bear case is that this is more like the Concorde is that, yes, if you can fly from New York to London for three hours, there's some market for that. But as it turned out, that market isn't big enough. Because it's such a narrow market for speed and certain connectivity, for certain models at certain sizes, with certain sparsity, the market may not end up being big enough. So we don't know where this is going to end up. We're really early. That $500 million from last year is just their investors paying them for revenue. There's not a lot of real revenue. So we're back to will OpenAI live up to its commitments? Which is a story in a movie we've been to with some other companies. And here OpenAI has a few outs. So a lot of execution has to happen between now and the next couple of years for Cerebras to fill their obligation to OpenAI and get its backlog. So to tie it back to valuation, if I was to give them full credit for their backlog at one times backlog, which is what Neo clouds typically are trading at, they'd be about $115.
- [13:38]
Melissa Lee
So it sounds like there are a couple of layers of execution issue by Cerebras itself, but also by one of its major customers, OpenAI, in order for them to pay Cerebras for those very expensive chips. Gil, the figure that you cited, the $100 million for the installment to run very big G and model very quickly, shouldn't we assume that the technology we get will get better and that the cost will come down and so therefore the cost per token will come down as well? This is early technology, as you mentioned, and costs should theoretically come down.
- [14:13]
Gil Lauria
Yes, but Jensen Huang isn't asleep at the wheel here. Right? When he saw this coming, when he saw the memory bottleneck coming, he quickly came and absorbed Grok incorporated into Vera Rubin. And so now he can deliver very similar speeds, let's say Porsche speeds, at a lower cost per token in a much more flexible way that can do training and various types of inference, and you can scale up and scale down the speed as you want it. So the, the cost per token will go down, but so will Nvidia. So it's not that Cerebras will continue to end to own the top end of the market again, maybe they are the Bugatti. But. But Jensen's already working on a very fast 9 11.
- [15:02]
Guy Adami
Hey, Gil, it's Tim. So people that drive Bugattis and Lambos and whatnot are people. What's that?
- [15:07]
Melissa Lee
Lambos. I can't believe you said lambos like a crypto, bro. Anyway, back into the question.
- [15:12]
Guy Adami
Gillies waiting patiently. Gil. So. So ultimately, it. This deal feels also just a little bit like. Like Andrew Feldman. Talk about a Silicon Valley entrepreneur that has been in the middle of a lot of incredible deals. Wild success. It feels like this was a deal, or at least this is the evolution of a company that, again, the reliance on OpenAI doesn't necessarily mean that technology is not there. This feels like a deal of a lot of people in the know and that the people that are buying now might not be. You know, it's a sexy deal. We get it. We get why they've been put on the map. Does this kind of support your claims here? I'm just looking at all the ingredients here, including the people involved. And again, I want to compliment Andrew. I'm not picking on him. The guy's been wildly successful, but it feels like kind of the best on this is yesterday.
- [16:06]
Gil Lauria
Yeah, I mean, let's not forget this IPO almost happened a year ago. And at the time, the market decided, you know, this technology is very cool, but it's probably not additive enough. And what's changed since then, as you were talking about earlier, is the memory wall. The models have gotten so much bigger, better need more KV cache, need more bigger context windows. So we have such insatiable demand for memory that they had the right product at the right time, because you can stack a lot of memories on that big dinner plate. And so that really revived the IPO and made it possible. But as you discussed very well a couple of minutes ago, I could buy Micron for 8 times their earnings run rate. Why would I pay 200 times revenue for a company that may not even be able to scale up that much faster than Micron? As you pointed out, the bottlenecks are there. There's other ways to play the bottlenecks. This was just the right product at the right time, as people are hungry for some new semis technology to diversify from the other type of semis they already own.
- [17:15]
Melissa Lee
All right, Gil, great to speak with you. Thank you. Hi, Lauria. The scenario that Tim describes sounds like people who would go in today might be holding the bag a little bit.
- [17:29]
Guy Adami
Yeah, I mean, and we've seen it
- [17:31]
Melissa Lee
with other IPOs in the past. Year or so where the best day of the IPO was either the day it went public or the next day. Figma, Etoro, Klarna Coreweave. Although it's come back. I mean we've seen it repeatedly here.
- [17:45]
Tim Seymour
Yeah, and they're gonna be bag holders without question. I, I think it's, to me it's just a matter of time. I mean three weeks from now, are we talking about this sum CRBs trading at the IPO price? I think there's a reasonable, a reasonable percentage for that to happen. And I would think that if you bought this stock at, you know, somewhere between 350 and 380 today, it's gonna be problematic over the next couple weeks.
- [18:04]
Guy Adami
What's the history of the bag holder?
- [18:07]
Tim Seymour
Well, remember bag Happy days. I don't think that's bag holder. Probably a Shakespeare thing. If you don't know the answer to say Shakespeare and you'll be right anyway.
- [18:17]
Guy Adami
No, you look up bag holder and you don't like what you find.
- [18:20]
Melissa Lee
No, definitely not. No one brought it up.
- [18:22]
Tim Seymour
I mean if you know the answer, tell us, tell the audience.
- [18:25]
Melissa Lee
You know, it's, it's, it's neither, it's neither place in history anyway where the
- [18:30]
Guy Adami
bag holder had a job.
- [18:31]
Carter Braxton Worth
Refer to these sleepy trust departments at banks with the bag holders. You know Wall street sell side security storms are fast and slick. And then the bag holders over here, we unloaded onto, onto them.
- [18:42]
Melissa Lee
Let's get to applied Materials, shall we? The shares are higher in the after hours though off their best levels after the company reported record top and bottom line results, both well ahead of Wall street estimates. Guidance for the current quarter also topping expectations. The CEO saying in a release the company is positioned for sustained multi year revenue and profit growth given the AI boom seems to make sense. I mean if you're going to make chips, you need the equipment. Stu, where do you stand on chip equipment makers?
- [19:08]
Stuart Kaiser
Yeah, look again falls into that bottleneck category. I think the one kind of risk here a little bit is you have the hyperscalers and the AI complex bidding up the cost of all of these chips. And a lot of these chips go into normal things too. I mean I think these, you know, the faucets in the bathroom where you wave your hand under them, have a chip in them somewhere. Right. So look, I think the demand is there, the supply is A couple years in the future we can debate valuation obviously, but until then I think these bottlenecks continue to work and it's a part of the market.
- [19:38]
Carter Braxton Worth
We want to discuss those Those chips aren't very good. Is it the camera? Is it the chip? You do this, do that, and then
- [19:44]
Melissa Lee
the water sensor doesn't work very well anyway.
- [19:47]
Tim Seymour
Is that why when I stand there looking for the spigot, nothing's happening?
- [19:50]
Guy Adami
So do you just blow off washing your hands in the back?
- [19:52]
Melissa Lee
Are we completely off? Are we? Anybody have comments on amat? I'm going to move on if. Okay, please, please.
- [19:58]
Tim Seymour
At 31 times, it's not ridiculous. Now it's a parabolic move, but it's not crazy expensive in this environment. So this is a great quarter. The guide was fine. Look, the move is ridiculous, but all these are. And I still think you can own AMAT at these levels.
- [20:12]
Melissa Lee
Coming up, Biogen not taking no for an answer. Why the biotech company is pushing an experimental drug to the next stage despite disappointing trial results and how could impact the stock. Plus shares of Ford putting the pedal to the metal up 20% over the last two days. While investors are piling into the automaker where our traders see the stock heading next. Don't go anywhere. Fast money is back into.
- [20:37]
Eamonn Jaffers
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- [21:06]
Christina Parts
Business tech changed the world, but so
- [21:08]
Melissa Lee
did the bubonic Plague.
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Julia Boorstin
Sundays exclusively on AMC and amc. The highly anticipated new drama series, the Audacity Genius is about being unhinged enough to do something outrageous. The show that Mashable says tears Silicon Valley a new one.
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Narrator/Announcer
People who have no integrity.
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Melissa Lee
Did you take the acquisition right by? No.
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Julia Boorstin
Maybe from one of the minds behind Succession and Better Call Saul. We want to save the world or control it.
- [21:30]
Guy Adami
Most of us go Dr.
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Julia Boorstin
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- [22:09]
Melissa Lee
Welcome back to Fast Money. Biotin shares dipping more than 6% today after a trial for its experimental Alzheimer's drug missed its main goal of testing for dosage effectiveness. The company, though, still plans to advance the drug to phase three testing. CNBC's Angelica Peebles has the details. What a rollercoaster ride for the stock. I mean, it was up as much as 10%, I think, and then now down 6%.
- [22:32]
Angelica Peebles
That's exactly right, Mel. This morning actually we hit it on Squawkbox and right away the stock was up 9%. And then throughout the day you saw, like you said, it fel 6%. So what's going on here? Well, this experimental drug failed that phase two trial because it didn't show a dose response. But Biogen's advancing in any way because they say that they're encouraged by other signals of efficacy. So what's going on here? Biogen says that the drug did what it was supposed to do. It decreased levels of tau, that's a protein associated with Alzheimer's, and that the lowest dose actually looked particularly promising for slowing cognitive decline. That's, of course, what we want to see here. So Biogen thinks that it has the right drug and that it almost has the right dose to move into phase three. Now the top line results were announced in a press release and there weren't any actual hard numbers, only descriptors like robust and compelling, making it hard for investors to decide for themselves how meaningful these results are and what they should expect to see. So analysts like RBC's Brian Abraham saying that they need to see the full results at a medical meeting in July and they want more details on the go forward plan to help frame the probability of success and the confidence in that phase three program. Biogen does plan to talk to the Alzheimer's community and the FDA about how to design those trials. And there's no timeline on when they might actually start that phase three program. So again, some interesting data, but also some questions there.
- [23:50]
Melissa Lee
Al so in terms of knowing now that the lower dose is pretty effective and that they feel pretty good about moving on to phase three, did they know about the lower dose efficacy prior to phase two? So phase two is valuable in that now they know that a higher dosage is not necessary.
- [24:09]
Angelica Peebles
You know, it's interesting, I was actually just reading a note from Evercore and they were saying that, you know, Biogen today is saying we think that actually makes sense that this lower dose is more effective. However, Evercore pointing out, okay, well if you thought that, then why did you design your trial to look at this dose response? So I think it's a really interesting question and one that we will have to hear more from Biogen and then those results to see exactly what's happening with those dose responses.
- [24:33]
Melissa Lee
Yep. Angelica, thanks. Angelica Peebles. Obviously a lot of hope surrounding all Alzheimer's experimental treatments and a lot of times investors have been burned by investing alongside those hopes.
- [24:46]
Tim Seymour
100% Holy Grail. Nobody's figured it out yet. And if Biogen was just a one trick pony, I'd say, you know what, I get the sell off. But it's not. Go back to the quarter they reported. I think it was April 29th, their first quarter. It was a very strong quarter. And if you look at their forward, you're going to earn almost $17 a share. So back of the envelope math here, you're talking about a stock that's trading 11 times next year's number. They have four or five already viable drugs out there. So I think the sell off is overdone on great pattern.
- [25:11]
Carter Braxton Worth
I mean it's been in the throes of a bearish to bullish reversal for almost two years and looks headed higher to me.
- [25:17]
Melissa Lee
Okay, so is it really the B in your Timbo? I mean now that Carter says the chart looks good, is it for sure? Yes.
- [25:22]
Guy Adami
I'm jumping in. No, I'm not jumping into this now.
- [25:25]
Carter Braxton Worth
I'm.
- [25:25]
Guy Adami
No fair weather. This is the B in Timbo.
- [25:28]
Melissa Lee
Look at that. It's confirmed in the graphic.
- [25:31]
Guy Adami
And it's because of what Guy said. I mean this is a 7 1/2% free cash flow yield trades 14 times. This is not a one trick pony. Having said that, if we were in the middle of the Alzheimer's brouhaha around Biogen, we could have been doing this three or four times three or four years ago. I mean this company, there's been a lot of criticism around both misleading advertising, somewhat clinical data reanalysis that maybe is repositioned the way they want it to. Pricing has been incredibly controversial and unaffordable. So this has been, I mean, but as Guy said, this is one of the great, great important discoveries out there that that is yet to happen. And, and a lot of people chasing. And they're certainly right there.
- [26:16]
Melissa Lee
Yeah, just quickly in terms of flows into healthcare has been challenging. But biotech specifically, how's that been?
- [26:21]
Stuart Kaiser
You know, biotechs are pretty good especially the smaller cap stuff. You know, if you look at within the Russell 2000, it's your unprofitable, quote unquote, lower quality stocks that have done well. Unfortunately, biotech happens to fall in those two or unfortunately, or unfortunately, depending how you want to look at it, tends to fall in there. So I would expect those stocks to kind of continue to work.
- [26:37]
Melissa Lee
All right, we've got a news alert in the luxury retail space. Brandon Gomez got the details. Brandon?
- [26:41]
Stuart Kaiser
Hey, Melissa. That's right. LVMH is selling the Marc Jacobs brand to brand management firm WHP Global, ending a nearly 30 year partnership. Marc Jacobs will remain creative director following the acquisition. WHP says the brand will become a cornerstone of its premium fashion portfolio alongside labels like Vera Wang and rag and bone. G3 apparel group is also joining the ownership group and will operate parts of the brand's direct to consumer and wholesale business. Now, deal terms were not disclosed, but WHP says the addition of Marc Jacobs will push the firm's global retail sales north of $9.5 billion. Melissa, send things back to you.
- [27:16]
Melissa Lee
All right, Brandon, thanks. Brandon Gomez, There's a lot more than
- [27:19]
Tim Seymour
the big rag and bone guy, by the way.
- [27:22]
Melissa Lee
Actually, we all snickered.
- [27:23]
Guy Adami
Yeah.
- [27:24]
Melissa Lee
Yeah.
- [27:24]
Guy Adami
I might even be wearing some rag and bone today. I'm not going to tell you what I don't have. That sequin coat though, that guy was wearing. I don't think I could pull that off.
- [27:31]
Melissa Lee
There's a lot more fast money to come. Here's what's coming up next.
- [27:36]
Julia Boorstin
Ford in Focus, the automaker surging for a second straight day. What's fueling that drive higher? The traders are getting behind the wheel on this trade. Plus updates from the mainland. The company's locking down some deals during President Trump's Beijing trip and why the chartmaster is bullish on one group of China stocks. You're watching Fast MONEY live from the NASDAQ market site in Times Square. We're back right after this.
- [28:10]
Narrator/Announcer
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- [28:41]
Tim Seymour
When I lost my sight, I had to answer some big questions like what
- [28:45]
Carter Braxton Worth
would you like the power to do.
- [28:47]
Tim Seymour
My answers helped me discover blind soccer
- [28:50]
Carter Braxton Worth
and now, now I get to share it with the next generation.
- [28:55]
Melissa Lee
Bank of America champions blind soccer player and coach Antoine Craig and everyone who
- [29:00]
Narrator/Announcer
dares to ask, what would you like the power to do?
- [29:03]
Melissa Lee
Bank of America Proud to be the Official bank of FIFA World Cup 2026
- [29:08]
Narrator/Announcer
bank of America NA Member FDSE what
- [29:11]
Melissa Lee
made you confident that you could do something that hadn't been done before?
- [29:14]
Christina Parts
I have no fear of failure.
- [29:16]
Narrator/Announcer
Trailblazing windows, changing the game.
- [29:19]
Angelica Peebles
One of my favorite pieces of advice, think about what your boss's boss needs.
- [29:24]
Melissa Lee
Leadership can look in many, many different forms. It really does come down to just trusting yourself. Life is short and you just gotta think big to accomplish big things.
- [29:32]
Narrator/Announcer
Julia Boorstin hosts CNBC Changemakers and power Players New episodes every Tuesday, wherever you get your podcasts.
- [29:41]
Melissa Lee
Welcome back to Fast Money. Four chairs revving up for a second straight day. Investors betting the company's partnership with Chinese battery tech giant Catl will kickstart the autom automaker's new energy business. The automaker hitting its highest intraday level since July 2023. During today's session, the stock is up more than 20% in just two days. Two days. This is not a chip stock. This is not a hyperscale. This is Ford, Carter.
- [30:07]
Carter Braxton Worth
Well, it's in the news. I mean it's like if you put dot com or AI into your title or something, obviously it's getting bid up for reasons like that. The question is as an operating business, is it a good buy or sell here? You can't ever do valuation on this because it lose money in any given year, make a lot of money. But we know that Wall street doesn't like it, right? The collective price target is below the current trading price. And I would say para 2 is
- [30:32]
Melissa Lee
at best all right.
- [30:33]
Tim Seymour
Best couple days it's had in a while. And Tim made fun of me month or so ago.
- [30:37]
Guy Adami
40 year chart.
- [30:37]
Tim Seymour
Thank you, Tim.
- [30:38]
Guy Adami
That's just what I was saying.
- [30:39]
Melissa Lee
40 year chart.
- [30:41]
Tim Seymour
Go back 40 years and this is where it was trading. However, you get a close above 16 and that's light years from where we are now. Now that's a classic Carter. I think you would agree bearish to bullish reversal. A couple more days like this and all of a sudden Ford's in play.
- [30:54]
Melissa Lee
I will play devil's advocate here. What if this marks a period in which Ford has to be re rated because of its energy storage business? If it does sign a deal with a hyperscaler that's a completely new stream of revenue outside the car business. Can you get on board that narrative?
- [31:13]
Stuart Kaiser
I think to Carter's point, if you just say, hey, we're an AI storage company, you're gonna get the benefit from that. We're doing distributed networking off our energy business. So I could see catching a bit. And look, it's also one of these sort of underperforming cyclicals that people were all bowled up about earlier in the year. Start to talk about rotation. These are the type of stocks that are going to catch a bid whether we believe the valuation or not.
- [31:33]
Guy Adami
We got caught up though, in their EV business just at its core when they were starting to show that they had the Ford F150 EV was the most popular EV yet. They couldn't do it. They couldn't produce it profitably. By the way, Tesla can barely produce their cars profitably. So I feel like we have seen a lot of gimmicks. We talked about this on the closing belt over time. I thought we had a great discussion. And, and yeah, it's the 4:00' clock show. And, and you know, you should watch that if you're not watching Fast Money. But I do think you should watch both, Tim.
- [32:02]
Melissa Lee
And watch both.
- [32:03]
Guy Adami
Yes, that's true. That's true. It's not a. Would you rather.
- [32:06]
Melissa Lee
It's not definitely not a.
- [32:07]
Guy Adami
Would you rather. But I would rather own GM over than Ford. And you didn't ask me this because I just think it's not about gimmicks. It's about six times forward. A company's never been more profitable, never been run better. And I'm not buying an auto company for an EV storage business business.
- [32:20]
Melissa Lee
All right, coming up, the latest wheeling and dealing from Trump's China visit. The CEOs leaving the mainland with a win and why the chartmaster says it could be time to dive into China tech stocks. A technical take when Fast money returns. Welcome back to Fast Money. Stocks jumping as investors eyed the latest developments out of President Trump's trip to China. The dow closing above 50k for the first time since February. It is less than a percent from a record. The S and P seeing its first ever close above 7,500 in the NASDAQ, also closing at a record up nearly 0.9%. And check out the JGB, Japan's 10 year government bond closing with its highest yield in 29 years dating all the way back to June of 1987. And some more after hours action. Shares of Figma jumping after topping earnings and revenue estimates. So we see that Stock higher by about 9% right now. Meantime, President Trump saying China has agreed to buy 200 planes from Boeing. For more on all of the deal making done in Beijing, Eamon Jaffers joins us with a very latest amen.
- [33:27]
Eamonn Jaffers
Hey there, Melissa. It is daybreak here in Beijing and President Trump gets underway with his third day of visit here in Beijing. In a couple of hours time, he's going to go to Xiangmin Gardens, which is a formal former imperial pleasure palace that is now the home to the Communist Party apparatus just outside of Beijing. It is sort of the most sensitive and secretive site in Beijing. The president is going to have tea with Xi Jinping and then he's going to have a bilateral lunch with Xi Jinping before he gets on Air Force One and heads home. That's when we think we might start to get a readout of what was agreed to behind the scenes. Amid all of the pageantry and the iconic displays on Tiananmen Square that we saw yesterday, we had a closed door session and we haven't had a whole lot of information out of that closed door session about what, if anything, was agreed to. President Trump did do an interview with Fox News personality Sean Hannity yesterday, during which which he said that the Chinese side had agreed to purchase some Boeing aircraft. Here's what he said.
- [34:34]
Carter Braxton Worth
One thing he agreed to today, he's going to order 200 jets. That's a big thing. Boeing's Boeing 200 big ones. That's a lot of jobs. It's a lot. Boeing wanted 150, he got 200. He said, I sort of, I think
- [34:50]
Stuart Kaiser
it was a commitment.
- [34:51]
Carter Braxton Worth
I mean, you know, sort of like a statement, but I think it was a commitment. Amen.
- [34:57]
Eamonn Jaffers
So, Melissa, we'll be looking to get some confirmation from Boeing about what exactly was agreed to here in terms of the order size, what type of aircraft, over how many years will these aircraft be purchased? And of course, the market's going to decide whether that 200 figure is enough to satisfy their appetite. There've been some discussion of a 500 aircraft purchase last year that seems to have dwindled down to 200 here. Still a bit big number for Boeing coming out of this. And we'll see if any other companies have similar announcements to make once the president leaves China. Melissa?
- [35:32]
Melissa Lee
Yeah, the glaring sort of omission out of all of this, Eamon, is Taiwan on the US Side of things. I mean, China made it very clear right from the start where they stood on Taiwan and where they wanted the US to stand. And at the same time the US Readout had no mention of Taiwan and President Trump declined to answer reporters question about Taiwan. Is that expected to come up in these sort of last hours? The two leaders will be together.
- [35:59]
Eamonn Jaffers
It's going to be interesting to watch and see if it does come up, Melissa, because to your point, you know, Xi Jinping was, I think you could say stern and bracing in his warning on Taiwan to President Trump yesterday. We'll see if he mentions it again. It may be that he has sort of, you know, touched that base and is ready to move on if he mentions it again. That'll be really hammering home the point and we'll see if President Trump pushes back at all. We don't have any reporting from the White House as to to what the president said on Taiwan in response. So is the president considering Taiwan as sort of a bargaining ship in a global trade or is he going to remain steadfast on US Policy on Taiwan? We'll see whether there's any change afoot there, but that would be significant if we do see it. Melissa.
- [36:46]
Melissa Lee
Yep. Eamonn, thank you. Eamonn Jabbers live for us from Beijing. I don't know if the president, if our president can use Taiwan as a bargaining chip. It seems like the Chinese president president could use Taiwan as a bargaining chip seeing that 90% of the world's AI chips are produced at Taiwan Semi. And if Taiwan actually fell into the hands of the Chinese Communist Party, I don't think TSMC could make those chips
- [37:10]
Guy Adami
for the US Market anymore if Taiwan wasn't leverage. And a bargaining chip for China with the US intel would be trading at 120 bucks. So there's a lot. I don't even know where it closed today, but somewhere, I mean, there's no question Taiwan Semi is such a strategically important company to not just the United States, Japan for sure to a lesser extent, but significant to Korea. So yeah, I think this is not going to be solved. I don't think either side really wants to get to it. But it is an important time for Xi to plant the flag in the ground and just say this is a non starter for me and he's reasserting
- [37:50]
Tim Seymour
the existential risk of the NASDAQ and maybe the broader market is that if it's some blockade or something worse than that in Taiwan and that's been the risk for a while now. The market hasn't cared, but now it's front and center in terms of who has it as a bargaining chip. And you know, we're involved in this war now where oil price is still $100 a barrel. Like is there to be some horse trading around that? Another thing, that's why
- [38:13]
Melissa Lee
it feels like it's the same error as holding the bag.
- [38:16]
Guy Adami
That was actually easier for me to understand by the way. It's not that difficult.
- [38:20]
Melissa Lee
But yeah. What do you think of this issue?
- [38:22]
Stuart Kaiser
Look, I think your guys point about Taiwan semi is the right one. This is a geopolitical issue, a military issue but also a business issue. Look, we've recently seen China exert their influence with rare earths. We're seeing Iran exert their influence with straight of Hormuz. And if you've read chip wars, Taiwan semi and those foundries are next level of this. That said, China is also integrated into the global tech and global economy and part of the pushback they got on rare earths was not just from the U.S. u.S. It was from the global community saying this is sort of an unacceptable thing to do to the global community. So I agree with you. It's those chip foundries that are the number one concern in this case.
- [38:57]
Carter Braxton Worth
But I think you have your first answer. The answer was there was silence.
- [39:00]
Melissa Lee
Yeah, there's no good way to answer
- [39:03]
Carter Braxton Worth
the question so it's going to stay silenced. That's my bet.
- [39:06]
Melissa Lee
Yeah. Well the K web, the China Internet ETF posted its worst day of the year down more than 4%. But the trmaster here, I put out a note this morning saying that it is time to buy. What do you see?
- [39:18]
Carter Braxton Worth
Yeah, so obviously a huge laggard trading at 52 week lows. It's the ETF that tracks Chinese Internet stocks like Baidu and Tencent and Alibaba and so forth. I think it's very asymmetrical. So here's the first chart of Several down about 36% again a 52 week lows, almost two year lows. But it has this minor basing and bottoming formation that's been going on well before any conversations with China. Let's put some lines and arrows and do some things. So we have what is generally stage bearish to bullish reversal buy. You can also add a downtrend line in effect since the peak this 36% drop and we have just now started to poke our heads up against that line. I think we breach it to the upside. Other ways to draw the lines you can do converging trend lines. This would be sort of an ascending wedge. It's also resolving to the upside out of that formation and then finally one last iteration, a very minor sort of ascending Triangle. It doesn't matter what you call these things. This is what a reversal looks like. And, and if it doesn't reverse, I think you've got again, asymmetry. It just, you waste time. But there's nothing in this price act that would suggest it's about to take out the lows and go lower. So it's either you try it, it doesn't work, or you do catch a lift.
- [40:29]
Melissa Lee
All right, Coming up, Coinbase and Robinhood in rally mode. And bitcoin keeps climbing the headlines out of DC Powering the crypto trade today. That's when he's back into.
- [40:42]
Eamonn Jaffers
Foreign.
- [40:46]
Melissa Lee
Welcome back to Fast money. Bitcoin and crypto related stocks taking a a leg higher today. The Clarity act crypto bill passing a key hurdle in the Senate. Emily Wilkins has got the details here. Emily?
- [40:58]
Emily Wilkins
Hey, Melissa. Well, yeah, look, this bill, it's the top legislative priority for the crypto industry. It's a rules of the road bill that's going to dictate exactly how crypto will be regulated by the federal government. And crypto companies say that this is going to be key for expanding who uses assets and win. All Republicans on the Senate banking panel as well as two Democratic senators advance the bill out of committee today. Still has a ways to go. Members from both sides of the aisle pledged to keep working on this bill, working on things like law enforcement ethics provisions before this could potentially get a vote in the full Senate. But it is a huge win for the crypto industry, especially when you consider who they were up against. They've been battling with banking groups for months over crypto's ability to offer rewards, rewards for stablecoin holders. Now, banks said that that was too much like bank interest. And while the bill that advanced today does put some limits on rewards, banks say that they are still loopholes that the crypto industry could use to match kind of what banks are trying to offer customers. Meanwhile, both labor groups and law enforcement groups also came out against this bill. But again, crypto has really ramped up their lobbying power and campaign donations in the past few years to the point where it is a real possibility that could see this bill go ahead and pass the Senate in the coming months over some of the objections. Really shows exactly how much power crypto has on the Hill right now. And of course, based on what the markets have, how confident they feel about this bill eventually crossing the finish line.
- [42:33]
Melissa Lee
Melissa? Emily, thank you. Emily wilkins, Although I don't know if we can make parallels to the pot industry and how many times we thought that various provisions were going to pass which would allow, you know, the industry to bank, for instance, and then it doesn't happen. I don't know. How do you feel about this Clarity act, given that the financial services companies are broadly still leery of it and
- [42:55]
Guy Adami
hold a lot of power? So despite the 120 million that was spent on pro crypto candidates into the election season and the amount of lobbying support behind this, and you can make an argument it's bipartisan, you could fall back on traditional definitions of those who like regulation and those who like less regulation. But to me, clarifying the regulatory extension or what the regulatory framework is over, the asset class is positive for the asset class. More regulation. I know that sounds awful, but more regulation in this case sounds what we need. Anti money laundering. Very important. Understanding how people can be taxed. Government needs to know that. That doesn't bother me.
- [43:32]
Tim Seymour
If you think Bitcoin is rounding here and trading back up to the low 90s Coinbase, which has been cut in half since July of last year, I think that's where you want to be. Now, you're not going to make a case on valuation, but you will make a case on the leverage it has around the bitcoin price. So I don't believe in bitcoin here. I still think it's going to be challenged. But if you think bitcoin's going higher, I'd rather buy Coinbase than bitcoin.
- [43:52]
Melissa Lee
Do you believe that, Carter?
- [43:54]
Carter Braxton Worth
I mean, as charts go, bitcoin's a pair of. It's just like. Is there a big thesis based on price action to be long? No. Is it look imminently at risk of dropping and paying you off as a short seller?
- [44:04]
Melissa Lee
No. All right, coming up, a software surge. But can the group keep climbing after a rough couple of months? What our traders see in store next for fast money in two.
- [44:18]
Eamonn Jaffers
Thousand and twenty foreign.
- [44:24]
Melissa Lee
Welcome back to fast money. The iShares Tech Software ETF IGB notching our move of the day today. It's popped more than 2% today and is now at up to 20% off of its April low. $74 was that low there. It's at 90. We had some notable outperformers in today's session. ServiceNow. MicroStrategy, or actually strategy was before known as microstrateg. What do you make of this move here?
- [44:51]
Tim Seymour
Carter did a piece last night. I think he was saying get out of. Get out of semis and maybe get into software. And I agree. I think the IGV is a classic Bearish or bullish reversal. I think valuations just got too cheap. Seemingly the spotlight is off a lot of these names. Very quietly. Oracle's had a bounce. Microsoft as well. I think you got to be long the IGV here. I think there's more room to go.
- [45:10]
Melissa Lee
Yeah. What do you think?
- [45:12]
Stuart Kaiser
Scenario we're pretty cautious about. I think still, you know, if you
- [45:14]
Melissa Lee
like the kill it.
- [45:15]
Stuart Kaiser
Yeah. And you know, it's, it's a, it's a tough trade because we're having the opposite argument. Like for a lot of these stocks, we're wondering if they're going to grow into the numbers. For Microsoft, we're wondering if the valuation or the software, if the valuation reflects where those earnings numbers are going. So it is the biggest short in price momentum. So you're going to really need a change in sentiment here, I think to get that moving.
- [45:36]
Guy Adami
Sorry. And what's your. What's. But you're bullish on Microsoft though, relatively. Is that what you're saying? Your house?
- [45:42]
Stuart Kaiser
Well, see, IGV is a little weird.
- [45:44]
Tim Seymour
Right.
- [45:44]
Stuart Kaiser
You're basically taking a play on three stocks. I know we've highlighted all these smaller stocks, but that is Palantir, Microsoft and Oracle. And you have to have a pretty constructive view on those. You know, Microsoft. To me it doesn't feel like a near term trade that I'd want to be in. If you're telling me six to nine months out that stock could be off where it is off the lows. Yes. But tactically speaking, I think it's going to be hard to get Microsoft moving with the debt overhangs and the free cash flow concern.
- [46:07]
Melissa Lee
Up next, final trades, Final trade time. Stuart Kaiser.
- [46:19]
Stuart Kaiser
I'll put my money where my mouth is. Go with the memory trade.
- [46:21]
Melissa Lee
Dram Carter Braxton Worth.
- [46:24]
Carter Braxton Worth
Kwab Chinese Internet Net stock for the long guy Halliburton.
- [46:28]
Tim Seymour
Sister Tim.
- [46:31]
Guy Adami
Great. But more importantly, with me behind me are the Pacero Center, Georgetown University's best and brightest. Let's give it up for In New York, Fast Money. Having a great time looking at global policy. This is why the world is going to be a better place. All these smart students behind.
- [46:47]
Melissa Lee
Did you get a final trade? Oh, all right. Emerging market. Thanks for watching. Fast Mad money starts right now.
- [46:54]
Narrator/Announcer
All opinions expressed by the Fast Money participants are solely their opinions and do not reflect the opinions of CNBC or its parent company or affiliates and may have been previously disseminated by them on television, radio, Internet or another medium. You should not treat any opinion expressed on this podcast as a specific inducement to make a particular investment or follow a particular strategy, but only as an expression of an opinion. Such opinions are based upon information the Fast Money participants consider reliable, but neither CNBC nor its affiliates and or subsidiaries warrant its completeness or accuracy, and it should not be relied upon as such. To view the full Fast Money disclaimer, Please visit visit cnbc.com fastmoneydisclaimer what made
- [47:27]
Melissa Lee
you confident that you could do something that hadn't been done before?
- [47:30]
Christina Parts
I have no fear of failure.
- [47:32]
Narrator/Announcer
Trailblazing women Changing the Game One of
- [47:35]
Melissa Lee
my favorite pieces of advice?
- [47:37]
Angelica Peebles
Think about what your boss's boss needs.
- [47:40]
Melissa Lee
Leadership can look in many, many different forms. It really does come down to just trusting yourself. Life is short and you just gotta think big to accomplish big things.
- [47:48]
Narrator/Announcer
Julia Boorstin hosts CNBC Changemakers and Power Players New episodes every Tuesday. Wherever you get your podcasts.