← CNBC's "Fast Money"
CNBC's "Fast Money"
Fast Money 8/25/25
00:43:37
Listen to our traders take you behind the money...how to play the volatility...pops and drops and the movers you missed. Fast Money Disclaimer
Loading summary
Transcript168 lines
- [00:03]
A
Live from the NASDAQ market site. This is fast money and here's what's ahead. Deals all day long. President Trump bragging about the government's new stake in intel says there could be more on the way, the companies that could be next. And if investors need to worry about this, plus car and truck prices to the moon and there is no sign of them coming down, some new numbers you've got to hear. And later on Google's Red Hot Summer, what the technicals are telling us about potentially discretionary stock breakouts. And Netflix's K Pop Pop, the animated movie giving the streamer its first box office win. Believe it when you'll see it and you'll see it. Hi, everybody. I'm Brian Sullivan in for Melissa tonight. Coming to you live from Studio B at the nasdaq. On your desk here tonight, bottle and ice, Dan Nathan, Guy Adami and Chris Verone, partner and chief market strategist at Strategic A Baird company. Welcome to you all. All right, stocks closing out the day a little bit lower. The Dow retreating a bit from that record high that it hit on Friday. The S and P and the Nasdaq also down. Nasdaq was up much of the day and then kind of faded toward the end. President Trump doubling down on getting more involved in corporate America. The president saying the government will make deals like the stake they just took in intel. And he says they'll do it, quote, all day long, maybe twice on Sunday. Intel jumping four and a half percent since that announcement, having its best month since March 2023, up 24%. And the Trump administration saying it might just be getting started. CBC's Megan Casella has more at the White House. What do we know tonight, Megan?
- [01:49]
B
Hey, Brian. So that's all exactly right. Intel warning in an SEC filing today that the government taking a stake in in a company like this is so unprecedented that it couldn't even list all of the possible risks. But the president making clear to reporters today that he wants to get as much as he can from private companies and that this could be a new model for industrial policy.
- [02:11]
A
I just made $10 billion or $11 billion for the United States of America. And yeah, there will be other cases.
- [02:18]
C
If I have that opportunity again, I would do that.
- [02:20]
A
And then, you know, you do have stupid people say, oh, that's a shame. It's not a shame. And it's called business.
- [02:27]
B
Now, it's not clear which companies might get this treatment next, but we can take a look at who the White House has targeted so far. So it could be companies that depend on regulatory approvals, including for things like export licenses. That sort of what we saw with Nvidia and amd, and they're selling to China. Or it could be companies in sectors that the government deems crucial to national security. But for this White House, that's already a long list. It's not just chips, but it's also things like lumber and furniture today, as well as pharmaceuticals, metals, drones, even wind turbines. Brian. So a long list here and just not clear at this point who might be next on the docket.
- [03:02]
D
Meghan, you're doing amazing work. Question to you. Is this the beginning of this sovereign wealth fund? I mean, I think the Swiss National bank has about $170 billion worth of equities. I mean, that is sort of the gold standard. Is that the type of thing we're probably looking at?
- [03:18]
B
It very well could be. We heard Kevin Hassett hear from this camera at the White House earlier today on CNBC saying that that's why he believes there are more transactions coming. And he said maybe not in this industry, meaning semiconductors, but it could be in other industries because it would be the start of some sort of a sovereign wealth fund. We also saw this come up in a similar way with the U.S. steel Nippon deal and the U.S. taking a golden share. They're also something where the sovereign wealth fund was discussed. Dust didn't come up explicitly with Nvidia and amd. But that's why so many companies now, so many business associations around town are whispering about this, wondering who might be next. Because we know, we've long known that the President really wants to build up a wealth fund just like that.
- [04:00]
A
Meg. Excel at the White House, Meghan. Thank you very much. So, guys, I mean, politics aside, as much as we can, all right? This is not gm. Yeah. In the bailout, the government took equity. The banks. Anybody remember Solyndra?
- [04:15]
D
Sure.
- [04:15]
A
Okay. What I'm. What I'm trying to say is that it doesn't. Those are different scenarios, Dan. But at the same time, it doesn't guarantee the success of a company.
- [04:23]
E
Let's separate a couple of things here, okay? This is a bailout. For all intents and purposes, this company is going in the wrong direction. I think we can all look back through our careers and say there's plenty of strategically important companies in this, you know, the history of this country that we bailed out. Fine. When you talk about a sovereign wealth fund, sovereigns invest in things that they expect to. To do really well. If you look at some of the largest holdings of the sovereign wealth funds that exist, Nords banks. One of them, obviously the Saudis have a big one Guy just mentioned this was they are investing in growth situations. This is not that. Right. So when you think about that, it's not a sovereign wealth situation. I'd take you over to China and I'd think of state owned enterprises that are strategically important. So 50 or 60% of the Chinese stock market in market cap terms are so ease. All right. So this is really what this looks like more. And then there's a certain sense of irony here. If your government owns a stake in the company, that means that you're going to have a level of regulatory oversight that might not exist in a company that doesn't have a stake. And this administration is meant to be the hands off regulatory, you know, from that standpoint. So I just think there's a lot of things going on. It is a slippery slope. I wouldn't think of it as something sort of a, you know, a sovereign wealth fund where you're investing in the best companies because you want a big return.
- [05:38]
A
But Guy Darmy, it's also popped the stock. Intel's up 24%. And let's, let's put up a chart of MP right. MP materials. MP by the way stands for Mountain Pass. I've been to the mine twice. The Department of Defense, soon to be renamed the Department of war has a 50% stake in that company now. And guess what? You can hate it, but stockholders have minted money.
- [06:00]
D
And that's what we're tasked to do here to figure out what it means for the stock. And listen, I will say that a year, year and a half ago on this desk we talked about the importance of intel and how it should be some sort of Homeland Security play. By the way, the stock was probably in the mid-30s at the time. So that might have been the right idea in terms of the stocks and stock market was the absolute wrong thing to do. But I do think this is just me. I do think there's this floor in the stock in terms of intel now playing it forward are.
- [06:28]
A
Now would you have bought debt instead of equity if you're the US Government? If they said Guy, I don't know where the.
- [06:33]
D
Why are they buying stock or intel debt was TR Trading. I mean if it was trading at some depressed level, I'd say yes. If they made the, if they made the assessment that the stock is more attractive than debt. I mean I can't speak to that, but I understand what you're saying, and hopefully they'll have those conversations. But I think at least for the short term, the intel bottoms in. And I think on nothing other than these types of headlines, this could be a $32 stock, a level we saw a year, year and a half ago.
- [06:57]
C
You know, Guy, I would tend to agree in the tactical sense. I mean, I think one of the best things going for the stock is everyone to a person hates it. There are 52 analysts that cover it. There's only four buys on the name. It certainly seems like 24, 25 has shown up as some type of tactical floor. Where can it go? 30, 31, 32. But don't forget the longer term picture. This remains a absolute long term bear market. I think 32 best case here. This stock peaked five years ago. It's down 75.
- [07:27]
A
Chris, all those things are exactly correct. Yeah, but now remember, good. You ever see the movie Goodfellas?
- [07:34]
C
Yeah, of course, right.
- [07:35]
A
Remember when they bought. They bought into the restaurant. No, no, they bought into the restaurant. Now that didn't end well.
- [07:40]
C
Did not end well.
- [07:41]
D
What a match.
- [07:42]
A
But they have now a partner, if you will, in the U.S. the most powerful entity in the world, the U.S. government. So how do we know what Intel's fate is gonna be?
- [07:53]
E
Billion dollars in revenues four years ago to about, what is it now, 52 billion? I mean, they have all.
- [07:58]
A
You give them all the billions now.
- [08:00]
C
As you know, we've been in the greatest maybe tech bull market of anyone's careers, at least in the last 25 or 30 years. And the stock's down 75% over the last five. This is a bailout. This is not a recognition of strength. This is not a growth company, as the Norwegian sovereign wealth fund would buy. This is something very different.
- [08:19]
F
Yeah, I tend to agree. It is a bailout. Now trying to kind of part and parcel some of the positives and negatives here. So there's an argument to be made that the weighted average cost of capital might be actually lower. Counterbalancing that is that this is probably dilutive and if the government comes in and we don't know ultimately what they're going to do, they may retrade this situation and they're coming in on the preferred level. I think that would actually give investors a lot more caution and maybe this momentum that we're seeing to the upside might start to kind of wane. With that said, I think Dan makes a great point in terms of these being state owned enterprises. I mean, this is essentially what this is. This to me screams of GM screams of Lehman and Bear and things of that nature. So again, I'm with the crew in terms of thinking that this really isn't a growth a growth story here. Now, in terms of national security, I can understand the argument there and I think that's kind of like the logic behind an MP Materials. However, if you look at Intel's revenue line, 76% of their revenue last year was from international. And you really start to wonder whether or not that starts to cramp a little bit of this and what's signaling that the government now owning a significant portion of this company kind of messages.
- [09:25]
A
Because I love the point and let me take the other side of my own argument then, Guy Dominic, you are.
- [09:30]
D
Equipped to do that?
- [09:31]
A
I am equipped to do that.
- [09:32]
D
And they invite you back to that for the second time.
- [09:36]
A
And by the way, the second time I was at the MP mine, there was a department defense person there walk poking around. I said that on the air. Now I know what they were doing. Anyway, could you make the argument that intel and they won't call it a bailout. Right. But we can you guys are saying that make the argument that what did the US Government see that required them to take the stake? Are they that was there a level of worry?
- [10:01]
D
No, I think that's fair.
- [10:02]
A
And so people who buy the stock on this news just know that the court. To your point, Chris, how does the core business look going forward? What did Lip Bhutan tell President Trump in that Oval Office meeting?
- [10:14]
D
There's a lot there. So what I've said, and I'm not suggesting this is right, I think there's a thought that intel could become sort of like what Taiwan Semi is to Taiwan. Intel could become two United States, different companies, same type of premise. It actually makes sense if you think about it. The difference here though, and I think this is important to bring up, this is not political. On August 6th or 7th, the President effectively accused Lip Bhutan, the CEO of intel, of being, and I'm paraphrasing to a point, some sort of operative for the Chinese military and or government. So he went from that extreme where you should resign immediately.
- [10:51]
A
Then they met. Then they met and he called him a great man with a great backstory.
- [10:55]
D
And so what's your point, Guy? Well, the point point is, you know, if you could set up a situation like that where you basically cast aspersions against a sitting CEO for whatever reason, have he or she come to the White House and then on the back of that get some better deal than you would have, you have to Say to yourself, how compromised are these people and what are they willing to give up in the path of self preservation? Because in a lot of ways that's exactly what this was.
- [11:23]
E
Yeah, so a couple other things. So you know, Biden just mentioned how much of their sales are overseas. Okay. So the government is obviously a big customer. When you think about their other other kind of businesses. They own 50% of the laptop CPUs. They own 70% or so of desktops as far as data centers. And again, this is not like the data centers are trading the miles. I think they also have 65, 70%. Okay. So this is all technology for the most part. That is backward looking. If you think about why Nvidia is a $4.4 trillion market cap company because now they own the GPU market. Now Taiwan Semi makes about 90% of those chips. That Nvidia has about 90% market share. So when you think about intel, they are not a manufacturing creating fabs and keeping them up, you know, well tooled and all that sort of stuff. It is not, you know, it's, it's not an easy business. Right. So the idea that intel is less than 10% of global, you know, manufacturing, they're not going to become a manufacturing powerhouse here in the US the last point I'll just mention we've been watching, you know, Facebook spending hundreds of millions of dollars to acquire talent. Okay. They keep screwing up their AI strategy and what did they do? They went out and they had to buy it from OpenAI, from Google, from all these other firms. And so this is not a company that's going to be able to buy talent. People don't want to work for a company that you think is going to continually get more and more capital from the government. I actually wouldn't call it a bailout because it's not desperate times yet. Could it go that way?
- [12:46]
A
Sure.
- [12:47]
E
But you know, right now it's just like the government thinks that they have, I think to guys point a necessity to kind of keep these guys going.
- [12:54]
C
I think one of the ironies here is Senator Sanders is endorsing us. Right. So to put this kind of in some context, I would encourage everyone to read James Freeman in the Wall Street Journal this morning talking about the irony of that moment. If this is another nod at this deglobalizing world that we're in and a global world was very countercyclical, is this another nod to the idea that we're in a much more cyclical type of environment?
- [13:15]
A
But the U.S. government's also helping TSMC in Phoenix, Arizona. We were there with Secretary Ludnick by by expediting permits. Let's stay on the semiconductor theme because there's a company that Dan just referenced guy you might have heard about. It's called Nvidia. They're pretty big. Their earnings are out on Wednesday. I suspect by the way we're going to get a huge reaction on the show on Wednesday. Just want to throw deep tease is what we'd say to that. Shares just off an all time high on Nvidia. You've also got Snowflake and Crowdstrike reporting on Wednesday after the close by the one but I mean the every the market's attention and focus and what's going to move the market I think is in video.
- [13:55]
F
Yeah we've had the Fed speak out and you saw what reaction we have from the market there. I think that was a tailwind. I think in video I think that all bets are kind of hanging on this one at least in terms of short term momentum. As I've said before, if you really look at the rally that we've really had since the bottoms in April it really has been a reignition of that trade and I think you're going to need to see Nvidia deliver here. I think you know there is some back and forth. We you know we discussed it earlier on the call in terms of whether the setup is good. You'd probably like to see Nvidia probably not trade so strongly into the earnings print in terms of seeing some upside follow through. Dan mentioned the 6% implied move which we know is in I would probably take the over there but I going back to China. I think the fact that China sales and revenue segmentation has been cut so much in this serves as a positive tailwind set up. We know the noise around the age 20 but I think the fact that it's gone from 26 to 12 or 13% probably gives you some upside there if that's able to turn around.
- [14:54]
A
Chris, how's the technical setup on Nvidia heading into earnings?
- [14:57]
C
I think it's essential that you protect actually Friday's low which was 1:7120. Underneath that you kind of risk a deeper pullback or pause here. I subscribe to the view of the world that when you're in an uptrend expect surprises to be on the upside and I suspect that's how we are set up here. And I would say you know look at the whole space. ADI broke out today. Texas Instruments broke out today. Taiwan semis Right there as well. So I still like semis over software. Certainly. We'll learn more on Wednesday.
- [15:23]
A
How important is Nvidia for the broader market?
- [15:25]
D
I think it's extraordinarily important. Go back to April and look what happened to the broader market. Look what happened in video went From I think 153 and change. Its all time high. Chris probably has it right in front of him. Traded down to $90 on the April low. I mean percentage wise that is a significant move and obviously the broader market, not necessarily on the back of that, but it pretty much acted in kind. So I think it is important. I think you're looking at a revenue quarter that's probably north of $48 billion. I think the streets at 46. I think the numbers will be staggering. The size of the numbers. I think the concern should be the magnitude of the growth in terms of revenue growth for the forecast because the numbers are getting bigger, the percentages are getting smaller.
- [16:09]
A
Well, eventually the law of large numbers. What are you referring.
- [16:14]
D
The law of large numbers is over. If you flip a coin five times in a row, it could be heads five times over a million times it's going to be 5050. So I think it's used improperly at times. I'm not suggesting you are. This law of large numbers is the number of revenue is so large the market is rewarding them for that. But the percentage beats or the percentage gains basically guide higher are getting smaller and smaller. Think about where this was. We went from a $7 billion to 11 and a half billion dollar guide. I mean you can do the math. It's a 50% revenue guide higher that continues to get smaller.
- [16:49]
A
I'm old enough to remember we talked about Nvidia with gaming. Then we talked about Nvidia with crypto. We don't even mention those anymore. Dan, is there, I don't want to say is there another Nvidia? Because this is unbelievable stock story. But are there other names out there that.
- [17:04]
E
Listen, this is kind of consensus here, but it would be Broadcom and Marvell. So the idea that, you know, Nvidia has this customer concentration, you know who they are. They're all the hyperscalers, they're open AI and all of them are working, let's say with Broadcom or Marvell to create their own custom chips. Right. They're going to do specific duties or whatever you want to call them. I just said duty.
- [17:23]
A
You said duty.
- [17:23]
E
Yeah, but you know they're going to do all these specific sort of things. Right. And so like, that would be the reason why you see a broadening out of this GPU trade. It's not like there's some company out there that it's going to develop the next mousetrap that's going to take on Nvidia and they're going to lose $2 trillion in market cap. Because unfortunately for those companies, innovation is going to come, you know, at a cost. Right. They're not going to be able to kind of do this and get bought by one of these other companies. And from a regulatory standpoint, that's one of the other things I'd say about Intel. They might be able to make acquisitions and kind of thwart some, you know, innovation. And that's their only because I'll jump.
- [17:59]
A
Out, I'll go out of here and get in a cab and the cab driver is going to ask me two questions. Number one, can you introduce me to Dan Nathan?
- [18:04]
D
Right.
- [18:05]
A
I'll say no.
- [18:05]
D
I think he's going to make.
- [18:07]
A
He's going to say, who's the next Nvidia? What do I say? Is there a next Nvidia?
- [18:13]
F
1 of 1.
- [18:14]
A
1 of 1.
- [18:15]
E
Some crap coin or something.
- [18:17]
C
I think Guy makes a great point.
- [18:18]
D
I mean, of course he does.
- [18:20]
C
Duty Stock Guy. As you know, if you look at it over the last decade, it goes down by 50% every couple of years. What happened this spring? It went down by 50%. What do you tend to see in the months that follow a double or a triple? So I still think we're very much in that throw here.
- [18:34]
A
So if you want to buy in video, we're waiting for some kind of a fall and just sit back and wait, save your money and boom.
- [18:39]
C
No, I think the trend is up. If you're long, you stay long. If you want to add before earnings, you do it.
- [18:43]
D
All right, so the question I often get is Brian Sullivan as tall and as good looking in person? And of course I say actually far better. It's remarkable. And this is interesting and this is just tying this whole a block together. Actually had a Baby Ruth prior to the show. The Baby Ruth was the candy bar that they talked about Duty. Now a lot of people think that was named after Babe Ruth, but in fact it was Grover Cleveland's daughter.
- [19:09]
A
Yes.
- [19:10]
D
You know this?
- [19:10]
A
I do. Is Grover Cleveland, the president lived in Princeton. There you go. All right, coming up, Google's rebound keeps ripping. But is the rebound for real? More alliteration in that story ahead. Plus a check on China. See results out of temu's parent pdd, formerly known as Pinduoduo. Fast Money is back right after this. You're watching Fast Money here on cnbc. We'll be right back. All right, the macro markets may have been down a little bit today, but guess what hit a new record high. That is Alphabet. Alphabet marking the first time that it's closed at a record since February. This Elon Musk's X A I sues Apple and Chad GPT parent OpenAI over alleged antitrust violations, accusing the companies of colluding to maintain monopolies in the smartphone and generative AI markets. OpenAI firing back, saying in a statement the move is consistent with what it calls a pattern of harassment by Elon Musk. We're not going to go into that, Dan, but we will talk about Alphabet because you flagged this possible move in that stock wait space.
- [20:36]
E
Karen is suing somebody right now. That's a shock. So when I think about Google here, it did make just a new all time high, as you said, two and a half trillion dollar market cap. And this is one of the names I think that there was the most trepidation about. And you know, when you think back to that Q1 earnings, we saw, you know, a lesser of a beat when it comes to Google Cloud as you did to Azure and you did to us. And I think that's something that a lot of folks have been, you know, kind of looking at and saying, okay, it's not seeing that sort of acceleration, which maybe means they're not seeing the sort of uptake of the models that are on Google Cloud. Well, that's changed a lot. I think a lot of investors have gotten a bit, you know, less concerned, I would say, about what the remedies might be from this DOJ case. And not only that they're going to be appealed. So the idea that they may now be considered to kind of fix Siri, which is going to be a key component of Apple intelligence at a time where the company, Apple is launching new cell phones and there's really no reason to buy them other than a better battery and maybe a better screen. So this would be really important. They need to be able to kind of show some sort of framework or timeline about how their generative AI capabilities are going to get better. Maybe this Google deal helps them do that.
- [21:45]
F
Yeah, I mean, as Dan said, this has been somewhat of a laggard in terms of the Max 7 recently because of the DOJ overhang. And then really, I mean, the elephant in the room has been whether or not generative AI is starting to cannibalize our traditional search. There's been a lot of back and forth. Management has come out and said no. In fact it enhances it. That's still to be determined. I'm still in the camp that I think they will eventually find a way to wrap AI into search and have it augmented in such a way where they're able to kind of monetize ad going forward. I don't think traditional search is going away. I think particularly as we see more and more agent. Okay. You're starting to see that whole ecosystem done in a way in a chain like logic manner that lends itself to more creatives and actually getting work done. Not into like simple queries. That's my take there.
- [22:33]
A
Yeah, there is and we don't know and we got to go but we don't know. Guy Domi what the court's going to rule but. But there is a possibility. Everything I'm reading suggests it won't happen. But there is a chance that Google is forced to sell off its Chrome browser and or other parts. Is that clouding the stock a little bit even at a record high? If we get that cleared up, does that help?
- [22:57]
D
See I think the enthusiast would say you know what, break it up because some of the parts is actually worse than the actual entity itself. You can play that game too. But, but to your point, I mean the level of uncertainty around search has definitely held this stock back. But I know Chris Rohn can speak of this. The fact that we took out the January prior all time high and closed above it suggest that now people say you know, it's cheap breaking out to the upside. You could be setting up for another 15, 20% move off the back of.
- [23:24]
C
Today'S close Guy I would agree. And remember it's a stock that really has made no progress for 18 months. So it's not like this is coming on the back of some big move. I do think we recognize it's August. Markets tend to pause here. If you got some pullback back to call 195 maybe low 200. I'm a buyer. The chart still good.
- [23:40]
A
Okay guys, sit tight because we actually have some breaking news right now. A news alert on some new additions to the S&P 500. Julia Boorstin with more Julia.
- [23:50]
G
Brian Interactive Brokers is joining the S&P 500. It is replacing Walgreens Boots Alliance. This is as Sycamore Partners is acquiring Walgreens Boots alliance in a deal expected to be closing soon. And now we'll see interactive brokers IBKR joining the S&P 500. Back over to you.
- [24:10]
A
All right, Julia Borson. Julia, thank you very much. So guys, anybody have a common interactive brokers? Do we care?
- [24:15]
C
Well, there's the old rule of thumb that by the time you get added, the move has happened. I mean the stock has gone from 20 to 60 over the course of the last year. So you wonder what's priced in at this point.
- [24:24]
A
Thomas? Peter, he was really rich. Now he's really, really, really rich is what you're saying. He's built a hell of a business.
- [24:29]
D
By the way, and the valuation of being rewarded for it. But I'm with Chris on this one. This had been lead the stock move seemingly has been leading up to this announcement. I think it's a sell the news event.
- [24:39]
A
All right. There's a lot more fast money to come. Here's what's ahead. Gating the moves in China tech. The latest results from Temu parent PDD and the latest bump from Baba plus higher end heating up. Why buyers are opting for more expensive cars as auto prices climb. You're watching FAST live from the NASDAQ market site in Times Square. We're back right after this. All right, let's talk China. Tamu's parent company, PDD holdings, better known as Pinduoduo, rallying earlier today after topping second quarter revenue estimates. Sales topping expectations. Earnings declining far less than anticipated. So declining less. PDD and other Chinese e commerce giants like a JD.com and Alibaba increasing discounts, increasing promotions to try to fuel demand, which is sparking a price war that this does not sound Bono unlike a case of a stock to buy. We're talking about price wars and declining sales. But yet the stocks keep going up.
- [25:52]
F
Yeah. And if you look at it technically speaking, it's kind of bumping up to previous resistance. This one gives me a little bit of pause wrapping in also the tax loophole kind of being closed. I think it's a tough setup. I never really want to see retail companies or any company for that matter really coming out and pushing hard on the promotional aspect. The last thing I'll say is it really is going to boil down to like their, their marketing spin and whether they're willing to continue to pay and advertise. And as we've seen from some of the, some of the ad, some of the ad companies, we've seen some pullback significantly in this Chinese demographic. So I do have cause for concern.
- [26:25]
C
We've been bullish Chinese stocks for a year. I think they act right. They still Operate K Web, which is the big ETF about to break out here through 39 into 40. Baba wants to go to 150.
- [26:34]
A
Why the stocks? The economy is a disaster. There's price wars increased, promotions increased.
- [26:41]
C
Brian. So the economy was a disaster. When I look at all the credit impulse data out of China, it's turning up. China and 1 growth is turning up. Chinese 10 year yields have turned up. That sounds like economic recovery. I think the stocks reflected. I want to be long.
- [26:54]
D
I asked this question to Joe Kernan a few weeks ago. I'll ask it of you. Are you familiar with my tube?
- [27:03]
C
Hmm.
- [27:04]
D
Is that a yes or no? I mean, if it's a yes and.
- [27:07]
A
You'Re talking about your acronym my.
- [27:09]
D
Exactly. Right.
- [27:10]
A
Okay. I don't know why earlier. I don't know what wallet Bob is.
- [27:15]
D
The B in said tube. And it's trading I think 125. I think it started the year around 82. And the reason why, Tamu Ubiquiti Networks Baba and no, no valuation play. And if you look at K Web and Chris can speak to this, 39 and a half the high in October of last year, March of this year, we're trading up to it now. You get a close above 39 and a half 40. And this is headed to 50 like boom.
- [27:41]
A
Can you refresh the memory of what is the tube?
- [27:44]
D
That would be Toyota Motor.
- [27:45]
A
Yep.
- [27:46]
D
Uber.
- [27:46]
A
Yep.
- [27:47]
D
The aforementioned Alibaba.
- [27:48]
A
Yep.
- [27:49]
D
And of course, equity. Funny story about eqt. Do you remember about a month, month and a half or so ago you did an interview on this show with the CEO of eqt?
- [27:58]
A
Yes.
- [27:58]
D
Toby Rice was a fantastic interview.
- [28:00]
A
Thank you. I was in Pittsburgh.
- [28:01]
D
I know where he's from.
- [28:03]
A
He's from Boston, but he lives in Pittsburgh.
- [28:05]
D
Extraordinary company. Since that interview that I said was amazing and I wax poetic about the stock. It's going from 59 to 50.
- [28:14]
A
That's because natural gas prices.
- [28:16]
E
Okay.
- [28:18]
A
Because it's been cool around America. It's been a cooler year.
- [28:20]
D
I'm just pointing it out.
- [28:21]
A
Well, it's been a cooler year. Thank you. But if the weather's been lousy, it's not been good. All right, coming up, the amazing, incredible numbers around car sales and why cost appears to be no object. Or as guy in his tube might say, no. Obj. Fast Money is back in two minutes. All right, welcome back to Fast Money. Stocks closing a little bit lower to start the week. The dow down about 350 points. But let's be clear, folks. We had a record high Close on Friday. Yeah, markets fell a little bit today. Friday we had a 90, 90 day. 90% of stocks were up and 90% of the volume at the NYSE was up only the 14th time. Chris Perrone. That has happened since 1980 according to Carson Group. Meantime, shares of so far jumping nearly 5% today, up more than 23% in the past month and so far I think kind of quietly highest level since 2021. Also Keurig Dr. Pepper announcing it's going to buy JD Pete's guy down me for $18 billion, biggest coffee deal ever. Clearly it's going to help boost Keurig struggling coffee business. They will combine and then they will split up into two separate companies.
- [29:45]
D
I think it actually makes sense and you've done a lot of work on this. Kudos to you. High margin business growth through acquisition. You know, in an environment where you need high margin businesses because everything is cutting into it in terms of tariffs and stuff. To me this makes sense. I don't know necessarily if you buy the stock on the back of it market but I like the idea behind it.
- [30:04]
A
Is anybody saying buy the stock on the back of this.
- [30:07]
F
The market certainly isn't.
- [30:08]
A
Well, listen the prices. So I like it. Thank you. By the way, I love commodities. Look at the price of coffee. Price of coffee continues to go up. Not only do you have natural factors drought in Brazil, but now you've got tariffs, right. We're a net exporter or Brazil's a net exporter to us of coffee. You tariff that, it's going to go up. You wonder, you don't know when this deal Dan Nathan became sort of going. But you're going to have a company here that's going to control I don't know what percentage of the coffee market but it's going to be a lot.
- [30:39]
C
It'll be a lot.
- [30:40]
E
Vitalin's all over this thing.
- [30:41]
A
Yeah.
- [30:42]
F
I mean I just think you look at the stock reaction for one. I mean it's $18 billion in cash. Right. So I think that's about as expensive as it gets. Like honestly, if you had looked at this merger, I think it was done in 2017 or 2018 and really there was the value in the share price. You would have been able to leverage those into kind of making this acquisition amidst all the other things that you mentioned. So I think the fact that they had to do it all cash makes me kind of wonder whether or not they've reached and then them kind of combining and then spinning off to me is somewhat of a bit of an admission of guilt that perhaps the merger wasn't really ideal in the first place.
- [31:16]
A
Yeah. And it's going to be kind of unwinding that deal. But to your point, look at this urbano. And if you're bored out there, folks, tonight, when the, when the show's over, not right now.
- [31:26]
D
Why would they be bored now?
- [31:27]
A
Do a list of brands that Keurig Dr. Pepper owns in drinks. It's they own a lot and now they're going to own a lot more anyway. All right, let's talk about favorite. Huh?
- [31:37]
D
Do you have a favorite squirt? Excuse me.
- [31:42]
A
Terra Fuel price hikes on vehicles not stopping. A jump in auto sales. Phil LeBeau rejoining us here to talk about these incredible sales numbers. Cars. It's like, Phil, I feel like the more expensive a car is, the more it sells. I know it's not true, but you get my point.
- [32:00]
H
Well, the truth is, and you've highlighted this for some time now, we are a country that is embracing more expensive vehicles. That's the easiest way to put it. Take a look at the change that we've seen over the last six years. Vehicles under 40,000. Just in 2019, it was more than half the market. 15% of that market has gone away. Where has it gone? A good chunk of it has gone to more expensive vehicles. In fact, now more than one out of every four vehicles sold in this country this year have cost more than $60,000. That's why the average transaction price according to Cox Automotive is close to an all time high, just under $49,000. That little rise there about two thirds of the way through, that was the pandemic and the chip crisis. And that's when the automakers said, we ain't got many chips. What we do have, let's put them in the more expensive, higher margin vehicles. You would think that would slow down sales overall. And a lot of people thought the tariffs would slow down sales demand after April. That has not happened. In fact, if you take a look at the rate of sales, this is not the actual number of vehicles but the pace of sales. It has increased, going well over 16 million last month. So as you take a look at the gm, Ford, Toyota, take a look at those stocks over the last year. And yes, there was the big impact. That's that downward area you see there towards the beginning of the year as the tariffs people realized they were going to go into effect. Since then, they've started moving higher. The pace of sales, by the way, this year, 16.1 million, most people Thought the sales pace this year would be about 15 million. Let's take a look at BMW, Mercedes and Ferrari, the European automakers. They've had an interesting time. They've also moved a little bit higher. It certainly helps that there is a tariff deal that has been locked in or at least the terms have been locked in. I don't know if it's finalized yet and that's going to be not at 25% but at closer what to 15 or 10% if you're in the UK. Bottom line is this Brian. Once there is greater certainty on the tariffs I think that's when you might see perhaps the automaker saying OK now we know exactly where everything is. Let's prioritize what we're going to build and sell. Until then, these higher priced vehicles continue to be in demand.
- [34:19]
A
Let's go to the very, very top end Phil, if we can. That is Ferrari. It's a hot stock race you've reported, right? Yeah. It doesn't matter how much the prices of the Ferraris go up. There's multi year wait lists for some of these cars, correct?
- [34:31]
H
Yeah, it's one of those brands that can get away. I just say get away. It's in demand and therefore it can afford to charge what it charges because there are so many people who want a Ferrari. So it is. When you look at auto brands it's at the top.
- [34:48]
A
Well said Philibo. Phil, thank you very much. Chris Frone. This all sounds very positive for margins by the way.
- [34:54]
C
Well there's not an auto stock in the world that hasn't turned over the last six months against Ford, Ford. Ford's about to make a 52 week I hear above. Tesla's right there as well. I mean really good price action in Tesla especially the last several weeks. GM breaking out Toyota to guy's point. Look at Suzuki, look at Mercedes, BMW on bad news. At the same time the leader that you just mentioned is actually breaking down. Ferrari has rolled over here 50 day, just broke through the 200 day. So you have a big leadership evolution within autos I think think all these broken names that have been so bad for so long have put in major bottoms here.
- [35:31]
A
I love Ford, I race a Ford powered car. A lot of friends of Ford, a lot of friends of Michigan but The stock's been 11$12 stock for like five years.
- [35:38]
C
It's about to get through 12 here. It's on its way to 14 or 15.
- [35:41]
A
So Ford breaks above 12.
- [35:43]
C
The analysts hate it. Six weeks ago you had the 50 day up through the 200 day on a relative basis it's making 52 week relative highs versus the S and P right now. Now it's a good chart.
- [35:52]
A
Did you know anybody that drove a Suzuki Samurai?
- [35:55]
D
I had friends, I rented one. Danny Sullivan won the Indianapolis 500.
- [36:01]
A
No relation.
- [36:02]
D
I know this. But he was a large man that drove. And I think of you and I think of him because typically they're sort of slight people. You are nothing but don't call it a comeback.
- [36:12]
A
Friday's massive rebound has changed the technicals of one consumer trade sticker around. All right, Friday's rip roaring reversal, revving the consumer trade back up. And one of your traders says this could be the beginning of a big bullish run. Let's go off the charts with Chris Fron for a closer look at what we call the consumer discretionary.
- [36:42]
C
Exactly. And Brian, you know it really speaks in context with this talk we just had on autos. I mean these have been neglected corners of the market that are quietly acting really, really well if you look at discretionary on its own.
- [36:52]
A
Right.
- [36:53]
C
And equally weighted. So not just Amazon, it is making new cycle highs but more importantly on a relative basis it is making about five year relative highs. So discretionary is the leadership here. I think importantly discretionary versus Staples is also making new cycle highs. So if you're looking to the market for some read on the economy, very constructive message there. You've seen these household durables turn. We talked about autos but you're also seeing homebuilders years. We've been very vocal about the turns in Dr. Horton and Lennar toll brothers today 50 up through the 200 day. And I think what's striking is here if you look at a chart of mortgage rates, they're breaking down. So there's support here from the rate side. The homebuilders act great. There's a lot of these small homebuilders in the Russell 2000 as well. Russell 2000 new highs are expanding. About 40% of the Russell 2 made a 20 day high last week. Those are generally pretty good internal indications. So I like consumer here. Against the backdrop up of tariffs of weaker labor, I don't think the market cares.
- [37:51]
A
Earlier in the show Bono and a guy named Chris Veron said that once you announce a new addition of the S and P the gains have priority been made. We referenced interactive brokers which is being announced, was announced by Julia Borson's adding to the s and P500. I wonder if all these moves that Chris just talked about when we do get a rate cut. Whether it's September 17th or not, when we actually get a rate cut, is the move now because people are, in other words, when we get the actual rate cut, are these stocks going to move or is this it?
- [38:20]
F
I mean, it's hard to bet against the momentum. I think clearly we've already seen some of these stocks run to a bit. You saw Berkshire take a stake in Lennar as well. I actually really like the toll play kind of staying up to that upper echelon of the consumer. I think it's hard to bet against. I mean, if you look at momentum and how it's, how it's performed, taking out a few days where the market has really broken down, that's really been a bullish and winning trade. And it's really hard for me to bet against that.
- [38:45]
A
All right, coming up, the animated movie giving Netflix its first box office win. Why it involves Korean pop singers and demons. That's next. All right, Netflix stock moving up, getting its first ever win at the box office. The streamer's second most watched original K Pop Demon Hunters stole the golden slot after premiering for just two days. Netflix stock up about 1% today, but it's up 35% this year. Julia Boorstin now joining us with more on It's a, it's a big, it's maybe not for our demographic like 50 year old dudes, but this is a big deal.
- [39:36]
G
It's a big deal and if you listen to the music, it's going to be stuck in your head forever. I can, I could speak from personal experience with that. It has played in my house. So K Pop Demon Hunter Sing along has grossed an estimated 18 to 20 million dollars plus from sing along showings of the film on Saturday and Sunday at 1700 theaters around the country. Now this is the first time that Netflix has ever done anything like this. And Netflix has a notoriously tough relationship with theater chains. AMC refused to show this film, but now this could provide a new model for Netflix to monetize its streaming hits and perhaps even more importantly, build its fan connections. The theatrical release comes after the animated K Pop Demon Hunters, acquired from Sony, was the top streaming movie in the US for weeks and now the the second most watched English language film ever with its soundtrack topping the Billboard charts. Roth research saying Netflix provided theaters a lifeline on a quiet weekend. And at the end of a summer which has struggled to hit pre pandemic numbers, the box office for the summer is tracking lower than the last two years. So we'll have to see if more Netflix special events can get audiences excited about theater going. This will be a fascinating one to watch.
- [40:48]
A
Brian Julia Boorstin, we heard earlier on CNBC you asked to sing one of these songs. I would not do that to you. But Julia Borstin, we appreciate it. Thank you very much. Netflix.
- [40:59]
D
Kai Adami I think the sell off we've seen before Netflix, this one lasts a little bit longer. It's probably a little deeper. But I do think the upward, the lower left, upper right is still intact. So I think you, I don't think you own Netflix. On the back of this are these hunters that are hunting K pop demons or they K Pop hunters that are hunting demons?
- [41:20]
A
I don't know. I was at Penn Station on Friday. Everybody was going to this concert. My guy named G Dragon and I noticed there's a lot of people. It's a big movement.
- [41:30]
D
Sure. Big movement.
- [41:31]
A
It was a big movement. Happens. Yeah. It wasn't just a little squirt. What do you think? Comment on Netflix?
- [41:36]
E
Dan yeah, I think what Guy mentioned about the stock in particular the fact that it came off after those earnings was not particularly great. It consolidate a little bit and this is probably a new sort of lever that I think investors are happy to see this sort of experience in a theater.
- [41:50]
A
There we go. We'll find out your homework up after the break. Final trades. It's final trade time. Kick it off.
- [42:06]
C
Chris Froome, Toll Brothers. Stick with the housing.
- [42:09]
A
Bottom one.
- [42:10]
F
Listen, I think Alphabet meets the definition of growth at a reasonable price. 20, 21 p. Alphabet.
- [42:18]
A
Dan Guy, is it Baidu? Is the B in your tube?
- [42:21]
D
No, it would be Baba Alibaba.
- [42:23]
E
They're both in the K web. I think you stick with the K web for breakout.
- [42:27]
A
He likes that. And Guy Dami, we're going to enjoy.
- [42:30]
D
You the rest of the week. You do have fun. I can just see it in your eyes. You're disturbed at times. You're amused at times.
- [42:37]
A
Mostly disturbed.
- [42:37]
E
But you're amused.
- [42:38]
D
But you do enjoy it.
- [42:39]
A
I do.
- [42:40]
D
We just heard Dr. Hook's sharing the night Together. Great song. But Valero. No reason to share it. Just buy it.
- [42:48]
A
Buy Valero very fast Guy. Dami got his tickets for the Air Supply finale tour. Thanks for watching Mad Money Starts now.
- [42:58]
I
All opinions expressed by the Fast Money participants are solely their opinions and do not reflect the opinions of CNBC, NBCUniversal, their 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 cnbc.com fastmoneydisclaimer.