← CNBC's "Fast Money"
CNBC's "Fast Money"
Nvidia Reports Results… And Target Misses The Mark 11/19/25
00:43:48
Nvidia on the move after reporting results. The numbers and details from their latest quarter, and what a top semi analyst sees in store for the chip giant. Plus Shoppers skipping the trips to Target. The disappointing numbers out of the retailers results, and the implications it could have ahead of the holiday season. Fast Money Disclaimer
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Live from the NASDAQ markets at the heart of New York City's Times Square. This is fast money. Here's what's on tap tonight. Off the charts, those three words from Nvidia CEO Jensen Huang helping send shares popping after hours. All the headlines from the earnings report from the world's biggest company and how to trade the semi giant now and wheeling and dealing. We dive into the announcements out of the US Saudi Investment Forum and the stocks most impacted by the news. Plus, Target misses the mark on earnings. Bitcoin treasury companies sink as a crypto continues the fall. And stealthy cat, the industrial giant quietly becoming the best performing Dow stock of the year. How it's leveraging AI to boost its business. I'm Melissa Lee, come to you live from studio be at the nasdaq. On the desk tonight, Tim Seymour, Karen Feineman, Dan Nathan and Gaia Downey. We start off with that big Nvidia bounce. After hours shares are now higher by just about four and a half percent after the semi giant beat earnings and revenue estimates raised its forecast. The conference call kicking off at the top of the hour, our own Christina Parts and Neville has got the latest. She's here on set.
- [01:44]
C
Christina, two of the biggest numbers for this earnings beat and why you're seeing the stock actually swing quite dramatically has to do with the Q4 Revenue Guide, which came in higher not only than what the street was estimating, but higher than buy side numbers. So at $65 billion, the buy side for JP Morgan and sorry, Morgan Stanley bank of America was 63 to 64 billion. So already higher there then gross margins. The company Collette CFO did say that they were going to exit the year at 75% mid-70s and they were able to do that despite higher input costs like from memory. We're talking about this offline and there were certain concerns that gross margins would come down. So I think that is a huge, I guess positive and why we're seeing a positive reaction. Of course, Jensen Huang is going to speak to all of the strength selling off the charts, you know, for quarters and quarters to go. We can't keep up with demand. But I think these numbers really justify perhaps that short term move. On the earnings call though, we will expect to hear more about the $500 billion order backlog that they spoke about through 2026. He said it in October, it was very surprising that he gave that type of guide before earnings. And so far into the future they don't normally do that. So that's going to be one. And then of course OAI financing is going to be another factor too, as well as the sustainability, the general sustainability of demand.
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B
Yeah, I mean the numbers were great. And the words, the terminology that Jensen has used on the call so far in guidance, it's virtuous AI cycle right off the charts. Everybody's computing everywhere. I mean, can't get any better than this guy.
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D
No. And we had JC on Monday, let's say Wednesday. Monday.
- [03:16]
B
Kramer.
- [03:17]
D
Yeah, Jim Cramer. And we asked him about margins. He thought margins would be okay and he was right about that. Tim was just on the overtime and he talked about it. He did crush it.
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E
Correct.
- [03:26]
D
I talked about a response and I think, I think I would agree that this is somewhat a muted response. I'll say this. Yes, the margins are good, good for them. But again, the magnitudes of the beat in percentage terms continue to get smaller and smaller and they continue to be, in my opinion, rewarded the way they might have been a couple of years ago. Now this move, we'll see what happens in the after hours. Think it's a great quarter. We'll see how it sort of plays out in terms of the stock.
- [03:50]
F
Yeah, I broaden it out like to their customers, like should matter. Microsoft, Google, some of these other. Should they be trading up off this? If you see margins sequentially, do they have more pricing power if they're sold off, if you know, they're sold out of Blackwell, that sort of thing. So it's interesting because you know, Metta, we saw the reaction to their spend and obviously a lot of that is going to in video. So good on you. And we already heard, as Kparts just said, you know, like that gtc, you know, a few weeks ago, I mean we already knew this. We knew it was going to be good. Listen, there's nothing to poo poo here. They beat, they got higher, the margins are better, you know, they're sold out of their main product. But I guess I'm more focused on their customers because to me, some of those Microsoft and Metta have barely seen an uptick since they reported a few.
- [04:32]
B
Weeks and they're not seeing much of an uptick in the after hour session on the back of this. I mean you could say that for every dollar that Nvidia makes, it's a dollar taken away from the hyperscalers. Reinforcing that notion that maybe that there is this massive spend with a questionable roi.
- [04:44]
G
That's the part, the questionable roi. But I, I agree. I don't think that the hyperscale they are, they, they knew there was demand because they're demanding. Right. And they knew how much capacity they could get or where they get scaled back. I mean I, Christina brings up the very important part. That $500 billion number is such a big number and it's such. And it's for a year out. Right. So that's a surprising amount of clarity. Yes. For what could be, I don't know, maybe a difficult time. I do think what's changed from the last month is the demand is absolutely still there. But what is more expensive now is building the data centers. If for no other reason than because the debt has gotten more expensive. So to the extent that, well, maybe money isn't limited in this space, who knows. But if there's only so much money to go around and more of it is spent on interest, then somewhat less of it has to be spent on the rest of the AI build.
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B
So are you questioning the quality of that $500 billion guidance?
- [05:46]
G
One other thing I want to say about Jen. Nobody manages the Street.
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B
Oh yeah.
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G
For better than Jensen.
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B
Every single word you would want to come out of his mouth has come out of.
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G
Now let's say what is the absolute.
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B
What can I choose the stock higher Virtuous cycle off the chart. It's really, it's textbook.
- [06:07]
A
Is that what you want him to say? I mean I don't and I think we've talked about it because I remember on GTC day it was virtuous cycle. Was. Was the quote. But I don't know, I guess I feel like I'll just talk about the stock in a vacuum, not relative to the market, but the stock by itself. What's going to happen here is you now have an analyst community that can upgrade the stock. That 500 billion plus for 26 was something that we heard. We liked. It was nice. But we all know that the street was probably 30% or more lower than that. You're going to see follow through on, on upgrades. I also just don't think. I know it sounds Crazy to say that there's not a lot of momentum in Nvidia stock, but there's more momentum in other parts of the market than in Nvidia stock. I think the stock's going higher on this independent of the market. I realize we have some important stuff coming down the pike, including a Fed and some other things, but in video on its own, this was enough to take the stock higher.
- [07:00]
C
I'd like to join two of your comments. You talked about pricing power. Actually it's quite strong. The average selling price, especially for the Rubin the next generation is much higher and that's helping them maintain margins. But then that goes to your point with hyperscalers, right? That gets more expensive for all of these hyperscalers that have to spend $4.8 million on 72 chips in a Rubin Rack versus 3 million for Blackwell. That a huge discrepancy when you're talking about buying millions and millions of or I should say many and many racks. The other thing too is the halo effect. Right now we're seeing a positive on amd, Micron, tsmc, big contractor for these chips. So it is having somewhat of a positive effect on the market. And lastly to your point about the 4% swing, most people thought this stock wouldn't move that much given it's gone sideways. So isn't that quite impressive for a $4.5 trillion company?
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D
Takes a lot I think given the solid Karen talked about this the other night. I mean given the setup into this earning earnings release, it makes to me it makes sense. You know, we sold significantly off the all time high back and filled a little bit. So it does make sense. But I get what you're saying. I'll say this as well. Look at Facebook over the last three or four weeks. They're being penalized because of the spend. If more and more companies start to get penalized because of the spend, what are they going to start to do? They might say, you know what, maybe we shouldn't be spending. So that number you just 500 billion is in. Maybe it's not getting that, but does.
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A
Does Marky Mark really care about what.
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F
Marky Marky Mark Funky bugs, the hyperscalers. Do you remember Guy Anyway, I did. Yeah, he did.
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A
For peace. Guy's a big fan of Mark Walmart.
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D
He's a fan of.
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A
Having said that, you've got a case here where I don't think at times Facebook or Meta, whatever we're calling them these days would really cares. They're going to do what they have to do. They're going to spend for where they think their business should be tomorrow. And they're going to block. They're going to block that out. So I don't think they're going to stop spending just to goose the stock price. I think they believe they need to continue to spend and I don't think they're going to stop spending.
- [09:00]
G
I agree with that. I think the last time they stopped spending wasn't because of the stock price so much, which was a lot of pressure on them, heels of Cambridge Analytic and all of that. It was because the promise in the metaverse turned out not to be there.
- [09:11]
B
Right.
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G
So I think they will continue to spend. It's been penalized. I mean, the stock hit 800 intraday, it's 590 now. So this is maybe, I don't know, $400 billion value territory. I think it's value territory. Yeah. So I sold some puts yesterday, which is the same as getting long. But one thing though, I really. We got to listen to the call and we got to listen to the questions. Right. So they're going to say what they want to say, but we'll see where they get really get pushback and how they respond to that. And do you want Jensen saying all these things? Yes, because every single time in the past he's always done it and he's been right. And he's been right.
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F
Think about this. The barbell of, or bookends, let's say Meta just lost in market cap. What they have committed to spend more capex more. A month and a half ago, Oracle actually gets this revenue.
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D
Right.
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F
That is going to be realized over the next few years and their stock realizes that in market cap terms immediately. AMD did the same thing. So when you think about this $500 billion backlog that Jensen spoke about, they just invested $100 billion in open air. What do you think OpenAI is going to do with that $100 billion? Half of it at least is going to in video back to them buying Blackwell.
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C
It's 10 billion per gigawatt. So I think the $100 billion is an arbitrary number that they may never actually follow through. I mean, I get the point.
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F
They're throwing out these numbers like, you know, they've invested hundreds of billions of dollars in this ecosystem. They have the free cash and stuff like that, but it's coming right back to them.
- [10:41]
B
Sure. Or, excuse me, Nvidia at this point is up by more than 5%. That's a gain of a $250 billion in market cap Oracle since we were credit is up 3% in the after hours and makes sense.
- [10:52]
D
I mean that's a relief rally. You know, Christina mentioned free cash flow. That number missed by five. But street was looking for $27 billion, came in at 22. I don't think anybody cares about that given the other numbers we're talking about. But you mentioned it so I just throw it out there.
- [11:05]
B
Christina, thank you. Keep us posted on the call. Christina, parts Nablus. Meantime, let's bring in the video both Chris, Rollin Susquehanna, senior semiconductor analyst. He upgraded his Nvidia price target last Thursday to 230 bucks a share from 210. Chris, great to have you with us. What do you want to hear from the conference call? It seems like Jensen's saying all the right things so far.
- [11:23]
H
Yeah, I mean the tone was incredibly upbeat. I expect more from Colette who's speaking now and Jensen soon to come. I think the biggest question and you guys talked about it earlier, that 500 billion, what is that exactly? Could there potentially be upside to that 500 billion? We would love some more details.
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B
Upside as opposed to down. We are Talking about the 500 billion in the context of potential downside. But you're talking about in terms of potential upside on that number.
- [11:56]
H
Yeah. Is there upside potentially to that number? If that is backlog, can they get extra components together, extra sales etc. And exceed that 500 billion? Currently we're only at 450 billion in our model after this report. So there's still a 10, 10% margin there to that 500 in street models. So we do think there is still upside over the next two to call it three quarters in terms of, in terms of beat, beats and raises.
- [12:30]
A
Chris, speaking of margin, let's talk about gross margin. Let's talk about the numbers that that again they hit. They got where they wanted. I saw your notes. You wanted to see mid-70s you got there. Tell us where you think this number is going and how much is that really the delta in your valuations?
- [12:47]
H
Yeah, so there was some buy side skepticism that they were going to hit that mid-70s. They did hit that in the guide. There was actually some adverse kind of numbers and puts and takes in there as well. So this was really healthy. I could see this going high 70s. I don't think we'd get into the 80s though at this point. Gross margin is not as big a story from this point forward as revenue.
- [13:18]
G
Karen, thanks for being on tonight. So the 500 billion, do you the upside that you are hopeful would come. Is that come from adjacent, like networking and software that all GP. Where did it come from?
- [13:33]
H
Yes. So the 500 billion number includes networking already. So that's compute Blackwell GPUs, but also all of the associated networking. That is a big number that was above the street. Not quite the 30% that Tim was talking about, but perhaps 20 or 15%. We were still below that 500 number. But is that 500 number static? That seems to be a backlog number. If they could get increased component availability of things like memory, let's say, or front end at tsm, could they potentially exceed that? And so these are the kind of details that we're waiting for on the call.
- [14:17]
D
Chris, before Christina left, she mentioned free cash flow. It came in at 22 and change. The street was looking for a little over 27. Is that a thing or just sort of brush it aside there.
- [14:27]
H
There are a lot of puts and takes here. They increased inventory because of this component dynamic that we're talking about, this memory shortage that we're seeing out there. So there's lots and puts and takes here. I don't think that's important for right now, Chris.
- [14:42]
B
We're seeing the stock at after our recession highs, pretty much it's 6.2%. The CFO is addressing the life of a GPU.
- [14:50]
G
And Karen, you flagged headline being extended and Nvidia says it had got $2 billion of revenue for older hopper chips. What's your thought on this sort of, I don't know, quite big question mark about depreciation.
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E
Yeah.
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H
So everybody's focused on useful life. And I think that the really big change should be a change to accelerated depreciation as opposed to a conversation about useful life, because these do have a useful life of perhaps 10 years, but all the value is really in the first two.
- [15:27]
B
So what does that. How does that affect the conversation around the sector, Chris? Then what.
- [15:33]
H
What that means is that the profitability is being overstated currently, overall, including the cloud GPU vendors.
- [15:44]
B
Chris, if you can keep us posted on what's going on, we'd love to hear your take on things, especially as a Q and A gets underway. I don't know if you're in queue to ask a question, Chris, but what is your first question before we let you go? What would that question be?
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H
It would be the details around the 500 billion for sure.
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B
Okay, Chris, we'll speak to you soon. Thank you. Chris Rowland, Susquehanna. What's your take?
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D
That's right. I mean, what's the. How do you have That, I mean listen, the clear. You have the kind of clarity, the details around that 500 billion, I mean that's a significant number that we're talking about. And I think the stock is. That's why the stock is where it's trading right now. We'll see what happens on the call.
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A
And the other thing that hasn't really been discussed is China and because we can't really, you know, it's not the first thing you start talking about. But there are a couple of comments that are coming through on the tape where again the CFO is talking about talking about sales that didn't happen in the third quarter because of China significant sales. And is that either a positive? Because that's pent up demand that we know is there and will find a way to work itself out. A lot of talk today about the sovereign kind of a trade and where that's going and why. I think that's a huge dynamic for Nvidia and at least other parts of the world that we're now friendly with.
- [16:53]
B
Or does that sort of underscore the notion that we are being, or not we, American chip makers are being kept out of the Chinese market and they may, you know, evolve an ecosystem without us basically in China.
- [17:09]
G
Yes, I guess that's sort of a worry for down the road a little bit because right now they have taken those numbers out, they're sat up. So any Tim's point, anything we do get on that front is upside, but I don't know, it'll be. The 500 billion is such an extraordinarily big number.
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A
I mean it's so funny.
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G
Why put it out there? Why go out on a limb and put it out there?
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B
I'm going to say what you normally.
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A
Say, because it's more like 700 for sure.
- [17:35]
G
That's right.
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B
That's why there's.
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G
That's right.
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B
Potential.
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E
Yes.
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G
Yes. That's why I say. Okay. He says it because he feels good.
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A
About it and that's why Chris wants more than 500 now.
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C
Right.
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A
It's so funny. I mean it's like if he's saying 500, it's really sad, but he has.
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G
To know it's bigger.
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A
You know what's interesting?
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F
So the stock about a month ago was at $180.
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E
Right.
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F
And it went up to. What's the number guy?
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E
206.
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A
Close.
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F
Okay. And then it came all the way back to $180. If this stock was trading at 206 with this guide and this result, I just don't think the stock would be doing anything now. What I think is more important about how the stock reacts is like, how does the whole ecosystem react? We've been spending most of this year talking about this bubble. And then all of a sudden folks over the last couple months really started saying, oh, maybe there is a bubble, and they started trimming their holdings. And when you think about this, Tim just said this on the OT. Didn't you say this about 30 minutes ago?
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A
A lot of smart. All right, so there I was.
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F
So. So what did you say? Half the Mag seven is under. Three of them are unchanged in the year. Apple underperforms it. There's just a different sentiment here. And so I guess my point is it's like I'm more interested again, as I started this conversation, I want to see how all these other folks are trading in and around this. And Nvidia is not nearly as important to me as I think about the market or the nasdaq.
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B
So the Q's are up a percent on the back of Nvidia's big gain. But I mean, just to see the hyperscalers pretty much at last check, at least not move too much.
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G
Right.
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B
Is that to you?
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G
I don't think they should. I do think that AMD should. Right. If there's that much demand for compute, who else is going to, who else is going to benefit from that? We know there's the demand because we know the cloud numbers have been that.
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F
Easy because you know, what Jensen keeps saying is that we have this software platform we get people hooked on. Once they had Hopper, then they're going to have Blackwell, then they're going to have Rubin, they're going to use Hopper for inference and it's going to continue to go that way. And people like he keep stretching out the depreciation. Sounds like a great deal. Right? So AMD really doesn't have that. When you think about how they're going to be able to compete on many levels, it's going to be on price.
- [19:27]
A
The most important thing to me over the last few weeks is that the market is discerning between, you know, hyperscalers. Just because they're spending doesn't mean they're in it. In terms of the queues up, you know, a little over 1%. You know, simple math, we can all do this. I mean, if it's, if it's 9% and it's up 6 and a half percent, there's 70, 70 bips of the 1% that it's up. So it's Mostly Nvidia. Thank you.
- [19:46]
B
That's the math that you learned. Georgetown taught you well a little bit. We will of course keep you posted on everything that comes out of the Nvidia conference call. We're 19 minutes in on that call so we're up 6% on the stock. Meantime, let's get to the broader markets here. Eking out gains and the day the Dow and the S and p both snapping four day losing streaks. The Nasdaq rose 6.10 of a percent. The gains coming even as minutes from the last Fed meeting cast further doubt on the possibility of a rate cut in December quote many officials saying no more are needed at least this year. Markets now pricing in a 1 in 3 chance the central bank will move next month per CME Fed watch of course the last meeting took place amid a dearth of economic data due to the government shutdown. While we will get the long delayed September jobs report tomorrow, the BLS saying today the October report will not be released. So that leaves us in still the data purgatory that we have been in.
- [20:39]
D
For a while and you probably got to get until January, February of next year to sort of even things out and figure out where everything stands. But you know a couple of things still to me are first and foremost the move in Bitcoin I think we need to talk about that's clearly a risk off thing. It can't get out of its own way number one. Number two we talked about this Jim the other night. Dollar yen continues to move higher 157 now at the same time their yields are going higher. Something's going to break there. And the other thing, yields here are stubbornly around this 411412 level and I think they're headed higher. Those things are not manifesting themselves in the market yet but the fact that the VIX is and again now north of 22ish and Karen talked about it the other day sort of no man's land on what had been rather benign days historically I think is a little concerning.
- [21:23]
B
By the way we also won't get the November jobs report until after the Fed meeting in December. So they will be meeting amid the same dearth of information that we are in right now.
- [21:35]
A
Yeah and we went into this in video number with at least just some more comments out of the Fed in these Fed minutes that these, these folks are not really aligned and we know where the Fed's going to maybe be in May but until then not sure.
- [21:46]
B
Yeah Karen.
- [21:47]
G
So I think if they don't cut it's just a cut delayed not denied. Right. And we that window gets closer and closer. I know the mark will be a little disappointed but I don't know in the end how much it matters.
- [21:59]
F
Yeah, I agree with that. I mean remember that long and variable lags of. You know what I mean? And so when you think about it, okay, maybe those rate cut that we got the end of 24, maybe they helped a little bit. We did see a reacceleration in Q2 and Q3 of this year in GDP. Obviously the Q1 was kind of messed up a little bit into the tariffs but again the market really hasn't had a problem one way or another with you know, these rates being pushed out. I think what's going on, the volatility that we've seen, the grind in the markets over the last few weeks or so has really been about this trade, not really about data or what the Fed's going to do do.
- [22:32]
B
Coming up, crypto crushed once again. Bitcoin dropping back towards $90,000. And the crypto treasury companies are faring even worse. What's in store for the space heading into next year? Next plus you can't spell caterpillar without I feel next to each other how the industrial heavyweight is reshaping its business amid the tech surge and why hyperscalers are taking notice. Do not go anywhere. Fast money is back in tube. For 140 years MultiCare has been in Washington prioritizing long term solutions, partnering with local communities and expanding access to care. Together we're building a healthier future. Learn more@mycare.org and now a next level.
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A
So good.
- [24:23]
B
Welcome back to Fast Money. Crypto treasury company is taking a sharp leg lower today. Strategy dropping nearly 10%, hitting its lowest level in over a year. Mara Holdings Riot, even Coinbase coming down with it. That as bitcoin prices dip back below 90,000, the crypto hitting a new seven month low. Dan, you're remarking about the treasury companies.
- [24:43]
F
Yeah, I mean one thing I just mentioned is like, like these became meme stocks, right. And I think that's why just like they overshot to the upside, they have the potential and they will likely overshoot to the downside. And you know, friend of the show, Tom Lee of Funstrat, he joined. Let's just pull up bit miner. It's BM&R and I think it's amazing for this company, they get a talent like Tom to join that company. But look what it did on June 30. What was the day that it. No, that he joined. It went from 5 and then a week later it's at 160 and now here it is at 29 is probably going lower. So the question is, is because somebody like this joins your company to do this strategy, does the stock deserve to have now an $8 billion market cap? Tim, you could do the math.
- [25:24]
A
What was it?
- [25:24]
F
I mean, when the stock was 160, what you know, and so, so my point is that they became memes, they became part of this thing. Now you're seeing them unwound and you're also seeing obviously bitcoin unwound. So the fact that they're both the Treasuries are going down in bitcoin. I thought it was not supposed to be that way. You know what I mean? I thought one was supposed to go up and the other was supposed to go down or both supposed to go up. But if you do to nonwind.
- [25:48]
G
Well, I mean so bitcoin's going down obviously. And so we know that his was.
- [25:53]
F
By the way, just to be really clear.
- [25:55]
G
And he would have said when it was trading up 140, wherever it was.
- [25:58]
F
Probably.
- [25:59]
G
Yeah, that's probably insane. So it's below where it was that day.
- [26:03]
F
That it nothing to do with him. What I'm saying is what investors were interested in doing.
- [26:07]
B
Sure.
- [26:07]
A
But it is.
- [26:09]
G
Well, I'm long bitcoin. I have been long, continuously Bitcoin since 2017. I'm staying long. Never would I have been in the, you know, these treasury deals because it just. Why pay more for extra bitcoin. I know they don't look at it that way. That's how I look at it. That's probably Jim Chanos looks at it. Dan, you would know that that just made no sense. You get into now this vicious cycle, we don't know where that's going to be triggered.
- [26:34]
A
And start more pressure leverage plays on, on bitcoin. We can again do the math. I mean you're going to, you're going to really underperform in this kind of a move. But then the companies that are backed by some kind of a stablecoin where it's, you know, that's, that's the part of this where I really think the, the frothiness has started to work itself off.
- [26:52]
B
There's a lot more fast money to come. Here's what's coming up next.
- [26:56]
F
The Caterpillar climb, how the farm equipment maker is winning the AI space and what it could mean for the stock into next year. Plus, off target, the disappointing results from the retailer this morning and how the.
- [27:10]
H
Holiday hunt for deals is impacting their forecasts.
- [27:14]
F
You're watching Fast MONEY live from the NASDAQ market site in Times Square. We're back right after this.
- [27:25]
B
For 140 years, MultiCare has been in Washington prioritizing long term solutions, partnering with local communities and expanding access to care. Together, we're building a healthier future. Learn more@mycare.org and now a next level.
- [27:42]
A
Moment from ATT Business. Say you've sent out a gigantic shipment.
- [27:45]
F
Of pillows and they need to be there in time for International Sleep day. You've got AT and T5G so you're.
- [27:50]
A
Fully confident, but the vendor isn't responding.
- [27:53]
F
And International Sleep Day is tomorrow.
- [27:55]
A
Luckily, AT&T 5G lets you deal with.
- [27:57]
F
Any issues with ease.
- [27:58]
A
So the pillows will get delivered and.
- [28:00]
F
Everyone can sleep soundly, especially you. AT&T 5G requires a compatible plan and.
- [28:04]
A
Device coverage not available everywhere.
- [28:06]
F
Learn more at att.com/5G network.
- [28:14]
B
Welcome back to FAST money. Caterpillar claiming the top spot, the spot as the top performer in the Dow this year surging more than 50% since January. And the industrial giants gains coming as it benefits from a big build in the air race. CNBC Sima Modi joins us here with more on this story. Fascinating.
- [28:29]
I
It is fascinating and it's warranted a lot of attention. Just in the last three weeks, Caterpillar reported better than expected earnings followed by that bullish analyst day where it sort of cemented this idea that Caterpillar is playing a Growing role in the build out of artificial intelligence data centers that need so much electrical power. With sales of its backup generators plus solar turbines up 31% over the past year. And then that sleepy energy transportation business that for the longest time wasn't something that analysts really focused on now makes up 40% of total sales. On the call. Caterpillar's new CEO Joe Creed who became the CEO in May of 2025 succeeded Jim Appleby. He really talked about how they're beefing up capacity and what they're doing to capitalize on this growing moment as in order for these data centers to remain efficient they need access to backup generators. If we look at the street call, there's about 48% of analysts that have a buy rating but equally a 45% have a hold reading hold rating, 7% at sell. And interestingly enough there's also a wide range of analyst price targets from 380 a share to 730. Melissa? The analysts who are less optimistic are concerned around valuation competitive landscape with the likes of ge, Vernova and Cummins offering similar energy products and also this idea that non residential construction spending hasn't really done much. It's remained challenged over the past couple of years. Christina Personal was talking about the halo effect of Nvidia. I just want to give you a snapshot of the industrial complex right now. When you look at names like Eaton, Vertiv G of Renova, all trading higher right now on Nvidia's report. These are the companies that provide the nuts and bolts to the data centers. The electric electrical equipment, the cooling to the gas power plants that NOVA is building for hyperscalers. And CAT is higher as well after hours. So that narrative is changing. Remember for the longest time CAT was the China proxy. It's trying to become more a part of the, the, the trade.
- [30:23]
B
Are there projections as to when this energy transport business will overtake the other parts of the business in terms of revenue?
- [30:28]
I
So that's the key question. I think we need to understand what the order book looks like over the next six to 12 months. That's the clarity that investors want right now to better understand how sales can quickly climb in the coming years.
- [30:39]
B
Yeah, Guy, what do you think of CAT here?
- [30:40]
D
I like it. I mean it trades in a market multiple. I think they have sort of changed their business around. Look at their earnings growth. It justifies the multiple. I think the average price targets 585. It's great to have seen me here breaking it down by the way. I think it can continue to go higher.
- [30:55]
A
I think breaking apart that. That data center kind of component trade, which is what we've done, and we did that with an analyst from, from bank of America. I mean, fantastic stuff. And Caterpillar is one of those names in there names like Siemens names. I mean, there's a lot of different ways we talked about the H Vac players, we talked about the folks in the, you know, the Otis elevators, and even those folks are involved.
- [31:15]
B
Yeah.
- [31:15]
F
I don't mean to sound cynical here.
- [31:16]
B
Oh, really? Oh, what are you going to say?
- [31:20]
F
Has 3x the S& P off the lows in April? I also remember, like 25 years ago when the Internet trade away from fiber, away from this, it just broadened out. Like people were just making, you know, like a lot of, you know, extrapolating a lot of this stuff. And I just think that when you get this sort of outperformance by a stock, this has outperformed many tech stocks, stocks that are associated with your Dell, you know, like that you think Dell is right there. They make the servers that go in the data centers. Right. And if Blackwell sold out, well, that should be good for, you know, Dell, that sort of thing eventually. Because they're going to have a big backlog, too. So, I mean, to me, you're going to chase this stock up 100% since April because they're telling a good story about how they're using AI operationally.
- [32:01]
A
Have at it.
- [32:02]
F
People have, by the way, she really surrounded the trade here.
- [32:06]
A
Crush that. Yeah.
- [32:07]
B
You haven't traded a caterpillar like that in, I don't know, ages, years, debt, maybe.
- [32:10]
F
It's an old fest.
- [32:11]
D
It's like an old school fest.
- [32:12]
F
It really is. We could have been trading potash Mosaic.
- [32:16]
G
I mean, this used to be a cyclical kind of company. Right. And it used to trade at a cyclical kind of multiple, which I think was maybe low double digits. Now it's, I don't know, mid-20s or so in what may still be a very cyclical. So I'm with Downer, Dan.
- [32:33]
D
Wow.
- [32:34]
B
I'm sorry.
- [32:34]
E
Maybe downer.
- [32:35]
G
I just wanted to take Yosemite, one.
- [32:38]
D
Of my favorite Karen lines, and we talk about this.
- [32:41]
B
Oh, yes, I'd agree with Dan, but.
- [32:43]
D
But then we'd both be wrong.
- [32:45]
B
It's tremendous.
- [32:46]
F
I think she has another one, too. What was the other one that you said about you? I agree with every word. What was it? Every word?
- [32:52]
G
Oh, I just. Every word you said, including. And. And the. Right. But I did not make that up.
- [32:57]
B
Right.
- [32:58]
F
So but it's we're one big happy family.
- [33:00]
D
Hello.
- [33:02]
B
Thanksgiving dinner here. Great to see you. Thank you. Sima Modi Coming up, missing the target on sales while the retailer is cutting its profit outlook and what it means ahead of the all important holiday season. More on that when Fast Money returns.
- [33:20]
A
About that, sure.
- [33:21]
B
Well, welcome back to Fast Money. We're getting some details off the Nvidia conference call. Christina Parts Nevilles is back here with the details.
- [33:27]
C
Christina, the desk wanted to hear more about that $500 billion number that was told in October and they got it was one of the first question on the earnings call and they did confirm and this is coming from the CFO that they shipped 50 billion chips this quarter. And she said we'll probably be taking more orders. Even today's announcement with Saudi Arabia and Anthropic, she said is net new. So not included in that $500 billion backorder that they mentioned back in October. She said, quote, there's definitely an opportunity to have more on top of that $500 billion number that we announced. So that is a very bullish sign for even more demand in the or 14 months, I should say through 2024. Separately. I know my colleague Eamon Jabros is going to speak to it. But the export deal to ship more advanced chips to the Middle east is another strong sign that when one door closes, that door being China, another one opens. And if these government officials actually did approve advanced chips going to the Middle east, that is a huge win. I'm waiting to hear back from Nvidia to just get more confirmation on that, guys.
- [34:32]
B
All right, keep us posted. Thank you, Christina. Christina parsonnevolo so we got that, that potential upside that we talked about in the beginning of the show. The stock gave up its after hours session. Highs are still higher by more than 4%.
- [34:42]
D
I mean again, it's all yes, that's the answer to the question. I think that's the answer the street probably wanted. But the Tim's earlier point from the overtime, it's a muted response. I mean I think that's a fair assessment of the trade in the after hours.
- [34:55]
B
All right, meantime, let's get to target here. Closing nearly 3% lower today after reporting mixed third quarter results, trimming full year guidance. The company reporting a third straight quarter of declining sales. Sales as shoppers continue hunting for value. But incoming CEO Michael Fidelke did announce several planned turnaround measures including a partnership with Open Air and an additional billion dollar investment in 2026. For more on the results, Mizuho senior analyst David Belanger is here on set with us. David, great to see you. Thank you. So what are you convinced by everything that that's going on here in terms of the additional spend? And I like is that going to be enough to turn the story around round?
- [35:31]
E
Not yet. And thank. Thanks for having me on. So we looked at the results today is pretty lackluster from Target you got same store sales down about 3%, earnings growth down, cutting the guidance again. And Michael Fidel Key, he's still in this interim role. He's becoming the CEO in February 1st so he still has his hands tied a little bit. But they are making some of these new investments ratcheting Capex up to about 5 billion from 4 billion. But if you want to step back and just look at where this company needs to go to put that in context, Wal Mart for example, they've spent 200/billion dollars in Capex over the past decade. So it shows you how big of a gap there is for these companies to catch up. Especially when you're going up against a Wal Mart or an Amazon. There's, there's a big uphill battle for Target here.
- [36:17]
B
At what point do you get concerned that the Target shopper of, of peak Target has permanently the Target years has found elsewhere to buy their throw pillows and lamps and groceries, potpourri guy scented candles, scented all you name, you name it, all that stuff.
- [36:34]
E
Yeah, I think we're there now. You see that the stock has moved down so drastically and it's how does Target bring back that momentum? Right. What do they have to do? It's very tough when you're going up against these big competitors. But Target's an incredibly discretionary business. A lot of merchandising. We don't have the building blocks yet of what this turnaround looks like. Like I would love if they went after something like grocery did get that frequency of delivery. Why couldn't Target have a good grocery business, maybe partner with a Whole Foods or Trader Joe's or Aldi and get like a shop in shop in the store. So there's something to be done there. But we just need to hear more and that there is a March investor day coming up for Target. So maybe that's the point where we get some of these bigger initiatives and sort of the game plan of what Fidelky will be doing doing.
- [37:21]
G
So we had on Jerry Storch a couple of weeks ago who when he was there said the whole plan was to have a much bigger grocery and not this sort of what he called convenience store sort of set up that doesn't bring the customer in all the time, once a week to do their shopping and then do the higher, you know, buy the higher margin stuff. Do you, is that part of what you think the plan may be in March and Investor Day?
- [37:46]
E
That makes a lot of sense to me, me. So when I shop at Target I might buy a frozen pizza here or there, right? Like that. That's the food purchase I make at Target. It's still more than 20% of the business. But the way Walmart really transformed their customer and got people in and you get that frequency, that purchase frequency. So what Amazon has in household essentials, so that, that could be the starting point. And then when you have people in the store then you start to bleed over into these discretionary categories and add to your basket and that's when it all starts to work together. But for now you just, you just don't have that traffic in general to begin the process.
- [38:21]
A
David, by the way, 100 bucks if you can give me the Storch from F Troop.
- [38:25]
D
Don't do that.
- [38:26]
B
Please stay on track.
- [38:28]
E
I don't even know.
- [38:31]
A
Larry Storch. But we shouldn't, you know.
- [38:33]
F
Yeah.
- [38:34]
A
What about the Capex dynamic? And in a world where there is leapfrogging on technology, why do they have to replicate ethnic even proportionate to what Wal Mart did? I mean Wal Mart's out there, that model has worked. Why can't they be more aggressive in digital? No one's going to touch Wal Mart in terms of the logistics and infrastructure. So that's really what Wal Mart is. They're kind of like Amazon for Amazon. But can't they take advantage of really what has worked for Walmart and catch up?
- [38:59]
E
Yeah, especially these catch up investments. A lot of times if you look back at something that was three or five years ago done, it's a lot cheaper today. You can get like all of this off the shelf software type stuff. You're not building it on your own so it's not as expensive. But that said, the E commerce game is an incredibly, incredibly difficult game to play. There's some behemoths in the space. Target has a great drive up business. Why can't that work in coordination with the grocery business? So I think about Target's drive up business, about $9 billion in sales, retail sales, that's bigger than a lot of retailers, bigger than five below itself. So I think there's something to be done there. But we're just giving them a little more time to get their game plan together. But, but for now, I mean, I think investors are looking at this as sort of on the wayside and the stocks basically in no man's land here.
- [39:50]
B
David, great to have you. Thank you so much for stopping by.
- [39:52]
E
Thank you.
- [39:53]
B
David bellinger, Mizuho Karen, I'm going to go to you. I mean, given the quarter, does a discount in valuation for Target Target make.
- [40:00]
G
It under 12 times versus Wal Mart, which is I feel like this, this is the time of the year when we again have that discussion and again, it turns out to be or it has so far turned out to be Wal Mart's a better place to be. That's how I'm positioned.
- [40:16]
B
Coming up, a big night for investments. All the deal talks at the US Saudi Investment Forum and the massive sums that could be flowing into the US from overseas. Best money's back to into. Welcome back to FAST money, A flurry of potential deals coming out of today's US Saudi Investment Forum in Washington. The White House saying the Kingdom will invest $1 trillion in the U.S. that's up from 600 billion across areas from fighter jets and rare earths to a massive infrastructure partnership. And just a few minutes ago, the US Commerce Department approving a deal to sell AI channel chips to the Middle East. Our Eamon Javors is more on what to expect and whether these deals could come to fruition.
- [40:56]
F
EAMON yeah, Melissa, that AI deal first reported by the Wall Street Journal and confirmed just a few minutes ago by a White House official. To me, it involves sales of sophisticated AI chips to the Middle east, including that Blackwell chip that's been sort of on the bubble. Whether or not the US Would allow that to go overseas or not, under the terms of this deal, that would be allowed to be sent to Abu Dhabi, according to the reporting by the Wall Street Journal and confirmed by a White House official who emphasizes that there will be strict security checks around all this. And we heard some big numbers today, Melissa, from the president. You talked about it. $600 billion up to a trillion dollars. No details, no specifics yet from the White House. We don't have a list of things that the Saudis are going to buy here in the United States. Here's how the president put it today.
- [41:47]
A
This week, our countries also signed groundbreaking agreements on civil nuclear energy, critical minerals and artificial intelligence. And I want to congratulate a lot of the great American leaders, business leaders that are in the room.
- [42:00]
B
And you'll do a great job for.
- [42:02]
A
Saudi Arabia and for a lot of other people in the room that are buying your product, taking your product and using your product. All of that is in addition to the $600 billion investment in the United States that Saudi Arabia announced during my unforgettable visit there last spring. Well, I said could you try and get that up to a trillion dollars? And yesterday the crown prince announced that the number that they'll be investing in the United States is $1 trillion.
- [42:34]
F
Melissa, a trillion dollars is a lot of money and it's actually almost the entire GDP of Saudi Arabia, their GDP about 1.2 trillion. So, so you know how that money will be deployed, where it's going to come from, where it's going to go over what period of time. You know, we're still waiting for the White House to fill in the blanks on some of those details to get a sense of which industries in the United States might most benefit from that Saudi spending.
- [42:59]
B
Yeah. Eamon, thank you. Eamon Jabbers at the White House tonight for us. We did see a number of stocks in the session move in the back of announcements. G. Vernova being one AMD yeah.
- [43:10]
F
You remember back in January where the Stargate announcement in the White House in the Oval Office, remember Elon Musk, friend of the president back then, tweeted out almost immediately they don't have the money. And I know this sounds crazy about Saudi Arabia. They don't have the money. Piff, which is their investment fund is less than a trillion dollars. They have Aramco, which is a very illiquid thing. They have crude oil at 60 bucks. They're trying to diversify away from oil. They're doing these huge projects in Saudi Arabia. So the likelihood of them spending, you know, 500 billion to a trillion dollars is probably very unlikely.
- [43:41]
B
Coming up, some fast movers from today's session catching our attention. Why Freeport and Lilly were climbing into the green and what our traders think of the names more fast money into. Welcome back to fast money. Two movers from today catching our attention. Freeport MacMarn shares popping more than 3% after Scotiabank upgraded the stock to outperform. Firm analysts though did trim the price target to 47 bucks. And Eli Lilly setting another all time high popping nearly 2%. The pharma giant closing the day with a market cap of $992 billion or almost to that trillion dollar mark. Where do you want to go?
- [44:21]
A
I'll talk about Freeport. I'm long Lily as well. But Freeport again, better than expected in terms of some of the problems in their Grasberg Mine, which is one of their biggest sources of production. I think copper prices overall are going higher. This is a data center trade, but it's also an infrastructure trade I like with Tim.
- [44:34]
D
Two upgrades. One lower their price target, the other one raised it. Basically $47 is the price target. It should be higher than that. I'm with Tim on fcx.
- [44:43]
B
How about you? Lilly?
- [44:45]
G
Yes, so maybe there's a gravitational pull towards trillion, but I think the stock's gotten a bit of ahead of itself. Sold some upside calls the 1200s in February that come after earnings.
- [44:56]
B
All right, up next, final trades, Final trade time.
- [45:13]
A
Tim Dave Bellinger from Mizuho did a great job tonight on Target. We love him. He's also a Ranger fan. But I like Target long term. I can't argue with anything except Karen.
- [45:22]
G
Yes. So if it's good enough for the F block, it's good enough for the final trade as well. Selling some really upside calls in February. Stocks run.
- [45:30]
F
Dan, you know what stock got overly done to the downside? It was Oracle. I don't think any of us liked it on that pop. It's down nearly 40% from those highs. I think it's poised for a move back to 250.
- [45:39]
D
Big Winston, I'm looking forward to seeing you again tomorrow night. On Thursday, Gilead breaking out.
- [45:45]
B
Thank you for watching Fast Mad Monday Money with Jim Cramer starts right now. 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 Is it time to reimagine your future? The right business skills may make a difference in your career. At Capella University, we offer a relevant education that's designed to focus on what you need to know in the business world. We'll teach professional skills to help you pursue your goals like business management, strategic planning and effective communication. And you can apply these skills right away. A different future is closer than you think with Capella University. Learn more at Capella Eduardo.