← CNBC's "Fast Money"
CNBC's "Fast Money"
Nvidia’s Historic Day… And A Changing Tune On Tariffs 1/6/25
00:43:46
Shares of Nvidia closing at a record high, as CEO Jensen Huang gets ready to take the stage at the Consumer Electronics Show in Las Vegas. What he’ll say about the company’s next move, and if this stock can keep hitting records. Plus President-elect Donald Trump reportedly changing his tune on tariffs. The stocks seeing the biggest impact, and the inflation risk that comes with a universal tariff. Fast Money Disclaimer
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- [00:01]
Melissa Lee
What does it mean to be rich? Is it having more stories to share or time to give? Is it being able to keep your loved ones close or travel somewhere far away?
- [00:12]
Julia Borson
At Edward Jones we believe the key.
- [00:14]
Melissa Lee
To being rich is knowing what counts. Your dedicated financial advisor will take a comprehensive approach to your financial strategy to help support what truly matters to you.
- [00:25]
Julia Borson
Edwardjones.com findyourrich Edward Jones member SIPC.
- [00:32]
Melissa Lee
In.
- [00:32]
Karen Feiderman
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- [01:05]
Melissa Lee
Live from the NASDAQ Markets 8 in the heart of New York City's Times Square, this is fast money. Here's what's on tap tonight. Chips rip higher. The SMH ETF seeing its best day since September. Nvidia setting a record close and nearly overtaking Apple in market cap once again. But can the longtime AI darling keep its lead in the space? Will hunt for some answers and a potential shift in Trump's tariff policy helping shares of GM rev up today. What's on the table now and what it could mean for the markets and trade. Plus, bank stocks get a boost. Analysts see some big tailwinds for one airline shares and why weight loss drugs may hit a wall just like your New Year's resolutions. Let's hope not. I'm Melissa Lee coming to you live from Studio B at the nasdaq. On the desk tonight, Karen Feiderman, Dan Nathan, Guy Adami and Chris Veron, head of technical analysis at Strategus, a Baird company. And we start off as we return to all time highs for Nvidia, the semi giant topping $150 a share for the first time since its stock spike split, notching its first record close in two months. The Darling jumping more than 3% today and is now up almost 9% in just five sessions. Today's move coming hours before CEO Jensen Huang takes the stage at CES in Las Vegas. Will he satisfy investors? The company will keep the lead in the race. CNBC's Christina Parts Nevilles is here with more. What can we expect, Christina?
- [02:22]
Christina Parts Nevels
We can definitely expect that he's going to build momentum around this stock. And I say that because just last year the share price of Nvidia shares actually jumped about 6% on day one for this company so what we are expecting from Nvidia would be it's a themed from his keynote that is coming out tonight. It's going to be focused on air specifically for the Blackwell chip. And I say the Blackwell chip because on the last earnings call in November they said that they were shipping more than they originally thought, but they didn't actually provide concrete numbers. Investors want reassurance that they can provide and keep up with that demand heading into 2026 especially. And then also within maybe a tease of Rubin, that's the next iteration of the chip architecture that's slated for 2026. There's some rumors that maybe it will come earlier this year. And then since we're speaking of AI, we may also get more about the humanoid robots dubbed Jetson Thor, launching in the first half of this year. So literally from software to robots, Nvidia is really positioning itself to sell, quote what they call the full stack solution. And I know I just talked about, you know, Blackwell, Rubin, these robots getting all the buzz given how much it contributes to revenues. But gamers are really excited too tonight because Nvidia is expected to release new graphics cards. And then there are, there is some talk right now that Nvidia might actually jump into the AI PC processor market which would put them in direct competition with amd, Intel, Qualcomm. Again that's just a rumor. The keynote will be a driver for the stock. Nonetheless, tomorrow's Q and A with investors will also be a big one because that's when they're really going to get, you know, those questions about financial targets, if they get any updates on that and China restrictions, etc.
- [04:04]
Melissa Lee
Yeah, the investor call tomorrow. Seems interesting to really allow the follow up to this, you know, potentially momentum building event.
- [04:10]
Christina Parts Nevels
And it's on Nvidia's website so it'll be for everyone to see. They'll have access to it as well. And usually that's also a big driver. And the CFO collect Kress will be speaking tomorrow to an event, a Fireside chat. So there's a lot that could potentially move this stock.
- [04:22]
Melissa Lee
All right, Christina, good to see you. Thank you, thank you Christina. Parts Neville.
- [04:26]
Dan Nathan
Great having her here.
- [04:26]
Melissa Lee
Of course, it always is starting the.
- [04:28]
Dan Nathan
Year off on the right.
- [04:29]
Melissa Lee
Absolutely.
- [04:30]
Dan Nathan
I haven't seen you in a while so.
- [04:31]
Stacey Raskin
Happy New Year to you.
- [04:32]
Melissa Lee
Am I allowed to say Happy New Year? No, I hate having like for another day or two and then no more.
- [04:38]
Dan Nathan
It's, you know Jensen, he does an amazing job saying what the market wants to hear. And I guess what's about four and a half hours from now. I think it's 630Pacific time is when he speaks, obviously learn a lot more. So I'm not concerned about what he's going to say. My concerns continue to be the same thing. Now it's a stock that's trading north of 18 times revenue, which historically is probably twice the valuation that companies like this deserve. At a certain point they're not going to enjoy the 76% margins that they currently enjoy. And competition is coming. All those things are out there. The price action over the last, and Chris can speak to this since that 128ish low has been extraordinary and here we are at all time highs.
- [05:16]
Guy Adami
Well, Guy, I think we need to remember this is a stock that really all the price progress last year came in the first six months of the year. For a stock that was up nearly 200% last year, only 8% of it came after June. So this has been a, a long consolidation here on Nvidia 150 is really the big level. We're right there. I do expect we'll close through it. We did make new relative highs versus the S and P today. So this is still a name that's very much involved in the leadership fabric of this market, as did Taiwan semi. But I think almost equally as interesting is some of these beaten, broken down semis which have been off the playing field for six, seven, eight months have woken up here a little bit. A Matt Lam research. I think that's worthy of our attention.
- [05:54]
Melissa Lee
Yeah, you're long.
- [05:55]
Chris Verone
I am long. You know, I've often thought that there's two parts to Jensen that are both amazing. Both his technical prowess. Right. And what they built, which is extraordinary. And then his ability to guide the street. I don't know what you want to call it. Lead the street.
- [06:10]
Melissa Lee
Talk up the stock.
- [06:10]
Chris Verone
Talk up the stock. You could call it that. He's really good at that. And I think the bar is just getting higher and higher. But he does seem able to leap over the bar. I mean, you know, I'd rather it not be up five bucks going into this presentation tonight, but I'm staying long. I think we'll see February 26ears, although maybe we will have a better sense even before that.
- [06:32]
Karen Feiderman
Yeah. And I guess, you know what, I got a lot to say about this. You know, the stock's going to continue to work as long as these sorts of events get, you know, investors excited about what the roadmap is. And I think it's interesting that Christine has Said, all right, we're not even done talking about Blackwell. We're going to start talking about Rubin. So that's what he's really great at, mapping that out. The flip side of that is, you know, if they're able to continue to guide that 18 times sales that guy just mentioned probably won't matter that much if they keep raising the bar in the, in the near term. But I'm more concerned about what Microsoft might have to say. They've been kind of loud over the last few weeks or so. If you go back three weeks ago, Satya Nadella was on the BGT pod that is Brad Gerstner and Bill Gurley. He said that they are no longer chip constrained, they are power constrained. I thought that was really interesting. Microsoft is a 19% customer of Nvidia. We also know that Microso Microsoft is working with the likes of Broadcom to do custom silicon. That's to diversify away from Nvidia chips. Right. I think some of these guys are getting sick of the pricing power. The guys point about 76% gross margins. Right. And then I go to today there's a story out that, you know, I think it was an information. They're going to spend $80 billion this fiscal year on infrastructure build out. Now that's not all chips, that's a whole host of other things. Okay, so let's see what that happens. The last thing I'll say is there's also a story that this Wisconsin data center that they're building out for their open air relationship, they have stopped the second phase of the build out. Why? They said the recent changes in technology have caused them to kind of reassess the design of the facility. So I guess if you start to see some pushouts in the builds of these data centers, if you start to see a slowdown in capex which we're not going to get until the end of this month. I just think there's a lot of moving parts. But Microsoft is a great barometer at nearly a 20% cut.
- [08:16]
Melissa Lee
I have a question for you. So Microsoft saying that they're not chip constrained anymore. Why is that concerning? As long as the.
- [08:22]
Karen Feiderman
Because Blackwell demand is insane.
- [08:26]
Melissa Lee
Still be insane even if Microsoft specifically is not chip constrained anymore. But others are picking up that demand chip constraint they can't get.
- [08:34]
Karen Feiderman
That means that they have the capacity.
- [08:36]
Chris Verone
Well they're the number one customer though. So they. You would think that they would get supply.
- [08:41]
Dan Nathan
Right.
- [08:42]
Karen Feiderman
By the way, I just said I don't. The stock is going to. If they have this Financial update tomorrow. It's basically a mid quarter update and things are fine. Better than some people expect. Perspective. To Chris's point, the stock has consolidated for months and months. There's been a move into Broadcom, into Marvell. This is the custom silicon sort of trade that is a diversification against away.
- [09:00]
Melissa Lee
From or does the consolidation mean that it's going to move higher because it's built well it did move higher.
- [09:06]
Guy Adami
That's where I lean. I mean we chopped in between 150 and 125 for the better part of six months. I would bet on a breakout. But Dan, I think you make up a very good point about Microsoft here. Not only is it not involved, it continues to deteriorate. I mean it's the weakest of this group. For 15 on Microsoft has been a really big level for basically the last six months. You lose 415 on Microsoft, you begin to wonder is there something going on here that I don't quite understand?
- [09:29]
Chris Verone
Yeah.
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Dan Nathan
And to Chris's earlier point, the SMH probably topped out in the middle of July and it's been trading lower to sideways since. It's back on the horse now for obvious reasons. But you know you mentioned energy. So Dan talked about, Chris talked about energy use. I mean VST pulpit chart and this had that huge move earlier. Why not earlier this year? Late last year sell off. Now we're right back to prior all time highs and you know oddly enough they report the same day that in video does at the end of February. So this is if you want to sort of go downstream, this continues to work.
- [09:58]
Melissa Lee
All right, well Bernstein Research reiterating Nvidia as a top pick. Analyst Stacey Raskin has a $175 price target on the stock which implies a 17% gain from today's close. He joins us now. Stacey, what are you expecting from Jensen tonight?
- [10:11]
Stacey Raskin
Yeah, as you said, Jensen puts on a pretty good show, right? It'll clearly be all around. I will see if we get updates on the data center side of things. Blackwell, Rubin. But at the same time this is also the Consumer Electronics Show. We'll hear about gaming probably. We'll probably hear about automotive. We'll probably hear as you mentioned, rumors made maybe that they're pushing into the PC space. We'll probably hear a lot about robotics and AI at the edge. I think he's got plenty, plenty to talk about and plenty for people I think still to be excited about.
- [10:37]
Melissa Lee
How much is it? Is the story going to also be what is being announced around Nvidia, not just Nvidia specific but sort of just the whole ecosystem of AI this becoming, you know, now the mainstream. It's not just corporations building up data centers but it's a consumer product at this point. Or we're entering that phase.
- [10:54]
Stacey Raskin
Yeah, I hope we're entering it. And we, you know, we had some updates today, some keynotes from intel and AMD and they both talked a lot about AI PCs where we have yet to see that driving a lot of like incremental strength in the PC market. But I think there's always hope Qualcomm the same thing around AI smartphones. So certainly the technology is the point where it's starting to get in consumers hands. I think we'd love to see it start to drive actual upgrades of devices on the consumer level. I don't know that we've necessarily seen that yet like in any sort of like large amount. But you know, these, we're all, we're all hopeful.
- [11:29]
Dan Nathan
Well Stacey, you've been bullish In Nvidia probably 90% of the time and you've been right to be bullish. Here's my question. If there is a competitor out there that concerns you, who would that be? What company is it?
- [11:41]
Stacey Raskin
Yeah, you know, so if I think about long term, how does this market shake out? I think GPUs are very important, but I'm not actually convinced. At the end of the day it's like two GPU vendors, like I cover Broadcast for example, who does Asics. And I actually do think the ultimate shaker, it's probably Nvidia GPUs. And then for captive workloads at hyperscalers, it'll, it'll likely be Asics. They're all working on their own. And I suspect Asics frankly will probably outgrow in the sense that they're coming from a much smaller base. But you can do the math today if I was, you know, it's a little bit of monkey math, but I bet ASICs relative to GPUs. ASICs are probably low, low double digits, 10, 11, 12% of the spend today. Could that number be 20% of a much bigger pie in five years? Yeah, I think it could. But my guess is that's the likely competition now. Yes. Does it worry me? It doesn't really worry me at this point because I don't think we're on the saturated part of the S curve. Things are still growing. So right now I think that the question asks is it a big market or is it not? If it's a big opportunity I think there's room for everybody. If it's not a big opportunity, then everybody's in trouble. I think that's the question that you want to have confidence one way or the other. I'll worry about competition later. I don't think it's the time to worry about it now.
- [12:56]
Chris Verone
Stacy's Karen, thanks for being on tonight. So if you have one $75 valuation, how do you get there? What are the metrics that you think are most important here?
- [13:07]
Stacey Raskin
Yeah, it's, it's earnings and multiple and I'll be honest, I can't actually remember what multiple we're putting on it. Right. But I don't think it's egregious. The stock today, as of today's close is trading at about 38 times forward, which is kind of right in line where it's trading. If you look at the five year average or the 10 year average, that's where it is. And I've made this point on the station before but as strong as the stock has been over the last year or I guess two years as this has gone, it's actually cheaper today than it was before it started. As much as the stock has gone up, the earnings have gone up even more and the multiples actually come down the multiple day. If the numbers are anywhere even close to right. The multiple is not egregious at all at these, at these levels.
- [13:49]
Karen Feiderman
Hey Stacey, broadening it out I guess. More to Guy's question. You just mentioned a Matt and some of these equipment makers here you look at an asml. It had a huge day today up seven and a half percent is a company about a month ago that gave horrible bookings. Right. And so this stock was not trading particularly well over the last few months or so. And then a micron which about two weeks ago gave not great guidance. Now the stock today fills in the earnings gap. You know I think the Stock was down 10% or so. Is this more investors looking for other opportunities to kind broaden out this trade? Because some of the narratives in and around AI for these other names have not really played out. It's been a very narrow trade in the semi space.
- [14:27]
Stacey Raskin
It really has. It's kind of been in video and Broadcom and more recently guys, guys like Marvel. Again on the ASIC side. Other names where people had high hopes like, like AMD have actually been disappointing. And not that AMD was necessarily bad in their performance but expectations were much higher and they were not able to meet those expectations. I think on the semi cap side you're right. People have been concerned about new export controls and limits on these guys abilities to further ship into China. In fact we even took our semicap wafer fabrication equipment numbers down on those China risks back in September, in December. So a few weeks ago. But yeah, today it wasn't just the semi caps, it was everything I think running. There were some comments around the Trump potential Trump tariffs and just some other broader excitement around semis and CS that I think took everything up. I don't cover asml, it's a colleague of mine refrain from commenting specifically there but all the semi caps were up quite a bit as well as a number of other names in the space today.
- [15:27]
Melissa Lee
Stacey, always great to have you on. Thank you.
- [15:29]
Stacey Raskin
Yeah, you bet.
- [15:31]
Melissa Lee
Stacey Raskin, by the way, Citi upgraded semicap equipment stocks so that's part of the reason why they were up today. Guy, what do you mean? I mean when you hear somebody who's very bullish, clearly been bullish for a long time, continues to say things like we don't have to worry about the competition right now.
- [15:44]
Dan Nathan
And he's been right to point that out. I mean it's probably not a concern right now given the head start that they have. He also addressed the size of the addressable market out there. If that's not a concern that they can continue to grow. I get all those arguments. I mean my concern has been will continue to be valuation not on a price to earnings but on a price to sales, which is a company. Listen, if you think that they go from $200 billion to somehow north of 600 over the next three years, yeah, they can grow into that price to sales if that's the case. If it's not the case, it's a very expensive stock.
- [16:16]
Chris Verone
I don't know. I'm still long. I do think that the stock will peak before the actual earnings peak. So the question is when does that happen? I don't know. I mean Stacey has been right for so long on this stock. So I do sort of take some comfort. The idea that he's like, you know, for right now, it's not crazy. It's not expensive. They're growing. He talks about the S curve. I mean maybe there's a lot of room to go still. So I'm staying in long. Even though it's a value girl, it's not so easy to do.
- [16:43]
Karen Feiderman
Yeah, I mean he's right. I mean it is cheaper than it was May of 23 when I gave that first guidance. And I guess it really does come down to A few things capex and we're going to get a good sense of that over the next few weeks. Use cases okay. That's going to be really important as we think about that. You know so it's less concerning about valuation as it relates to Nvidia broadcom With that 25% gap a couple that got pretty expensive. Right. And so when you think about the guidance that they gave about their custom kind of business between I think was 60 and 90 billion by the end of 2027 that was a few weeks ago that caused that move. I mean I think a lot of things are kind of getting ahead of themselves because that's kind of pie in the sky sort of guidance. So again I think if some of the use cases become clear, I think if some of the Capex is better than expected then this stock is going higher. And to your point about consolidations that's been the story for the last two and a half years. Gaps, consolidates more gaps.
- [17:32]
Guy Adami
We're still on stock as well. I think if you're playing this from a trading perspective trailing stop at 140 makes sense. I think if you're a longer term player 125 has been long term support on the stock. I think those are the two levels as we start a new year that you have to be very disciplined about.
- [17:46]
Melissa Lee
All right. Meantime, the big bank's getting a boost as the Federal Reserve's top banking regulator Michael Barr announced he'll resign from his post next month. The news coming amid speculation that President elect Donald Trump would seek to replace Barr. Investors betting this could pave the way for some wheeling and dealing in the space could also mean maybe less strenuous capital reserve requirements. Karen a lighter regulatory touch, more friendly banking regularly. All of the things that would theoretically be amazing. Stocks like a Citi by the way which hit a new high today.
- [18:13]
Chris Verone
Right. All of the things would be amazing for all the money center banks. I think that this is not new. I mean this particular bar is new but the idea that it would be a more friendly regulatory environment that maybe there's some capital issues that are improve things banks the M and A environment will help all of the big money center banks and the asset wealth businesses are doing well given the market so high. So there's a lot to like here. I think there's a lot to still like. To me the story changed only tiny bit today. It was already pretty good.
- [18:44]
Guy Adami
Well I think it's important the stocks live up to the news because the news from the election to this News has been bullish. So the stocks have to justify that. They largely have. They've been a very important part of the leadership fabric of this market for, let's say the last 18 months. So if we're going to continue to kind of operate in the status quo, the uptrend in the market, the bank leadership, I think it's important they respond to good news bullishly. They did today. I like Wells, I like Citi, I like bank of America.
- [19:09]
Karen Feiderman
Yeah. It is interesting, the names that you just mentioned that they're probably going to benefit most from that. J.P. morgan closed down on the year. I just think it's on the day. I think it's really interesting that investors are excited about this. What happened when we saw rates go up Precipitously in early 2023, we saw regional banks fail. Right. And so when you think about higher for longer, you think about loosening up regulatory as it relates to, you know, asset. I just don't see that as a good deal. These stocks trade well. They're trading at valuations they haven't in a very long time. And the BKX has just come off, I think about 7 1/2% from those recent highs. I just don't see a reason for excitement around a better regulatory environment as it relates to the banks.
- [19:47]
Chris Verone
One thing about Citibank, you said all time high, remember there was that 10 for one split about 50, 15 years ago that they, they never, they never got close to being.
- [19:56]
Melissa Lee
That's.
- [19:57]
Chris Verone
Yes, but in the modern era of post GFC no.
- [20:00]
Dan Nathan
52, we cried without quite. And I'll say this, this is one thing we've been consistent. I mean their book value, the stock in October they announced was 101. And we said, look, it's probably not going there, but 80% of book value makes sense. I can do that math, Mel. And we've said $80 is a landing spot and I'll stand by that it continues to sort of levitate towards that.
- [20:18]
Melissa Lee
Coming up full stream ahead, shares of Fubo TV tripling today after announcing a merger. How its content is coming together with Disney and what more media mergers could be on the horizon. That is next. Plus planes, trades and automobiles. Why Uber and United Airlines were in the green today. And if those modes of transportation can bring your portfolio to its destination. Don't go anywhere. Fast money's back into.
- [20:44]
Karen Feiderman
And now a next level moment from AT&T business. Say you've sent out a gigantic shipment of pillows and they need to be there in time for international Sleep day. You've got AT and T5G so you're fully confident, but the vendor isn't responding and International Sleep Day is tomorrow. Luckily, AT&T 5G lets you deal with any issues with ease, so the pillows will get delivered and everyone can sleep soundly, especially you. ATT 5G requires a compatible plan and device. 5G is not available everywhere. See att.com 5G for you for details. Weekdays at 5:00am Be first on world markets, first to the global business conversation. Get a jump on the investing day every day with Frank Holland. Success starts early. Worldwide exchange 5am Eastern, CNBC.
- [21:32]
Melissa Lee
Welcome back to Fast Money, A big announcement in the streaming world. Disney combining its Hulu Plus Live TV service with Fubo. That stock more than tripling in value on the news. Julia Borson's got all the details.
- [21:43]
Julia Borson
Hey Julia, Melissa Hulu plus live TV and Fubo together have 6.2 million live streaming subscribers. That puts the combined company behind only YouTube, which had 8 million as of its most recent announcement. Now Fubo and Hulu plus live TVs deal is a testament to the pressure to scale and of this new company, Disney will own 70% in Fubo. Shareholders will remain will own the remaining 30%. Now both services will be available to consumers separately and Fubo will create a new sports and broadcasting offering featuring Disney's network and will be able to offer some new, skinnier sports bundles in the future. Fubo, in expanding its offerings, will have more leverage in carriage negotiations while Disney gets greater distribution and more streaming ad inventory under this deal. Fubo has also settled litigation with Disney and its partners in sports streaming service Venue, apparently clearing the way for Venue's launch. Venue's co owners, Disney, Fox and Warner Brothers Discovery will pay $220 million to Fubo. The combined company will be cash flow positive at closing and projects seven and a half billion dollars in revenue by 2028. And all of this comes ahead of Disney launching its ESPN flagship subscription later this year.
- [23:00]
Melissa Lee
Melissa Julia does this pave the way for more deals? I mean, how should we look at this in terms of all the offerings, the sports offerings, and you mentioned scale, so combining in theory would be more advantageous. But it seems like there are a lot of different offerings from the consumer standpoint to wade through a lot of different offerings.
- [23:19]
Julia Borson
I think consumers are going to have increasing amounts of choice and I think a lot of that choice will be around bundles. We may see a lot more consolidation this year, but I think a lot of that will depend on how the regulatory environment actually ends up being for deals. So while that's still a little bit more uncertain, I can say for sure that we will see more bundling. There are so many options. These companies understand the benefits of coming together and bundling their offerings to make it easier to navigate and also to remove churn, reduce churn for Hulu and Fubo. They will have a lot lower churn. If people aren't just signing up for Fubo to watch a season of their favorite sport and then dropping it, they're giving people that additional functionality to really make it worth sticking around for the long term.
- [24:06]
Melissa Lee
You also mentioned Fubo and more leverage in carriage negotiations. I didn't even realize that Fubo was distributed via cable. I thought it was only streaming. So how much of a presence does it have and how much of a presence is it expected to have at this point, especially as everybody is sort of, you know, really coming down to very difficult carriage negotiations?
- [24:32]
Julia Borson
Well, Fubo has its own carriage negotiations with all these different partners. And really the origin of Fubo's lawsuit, excuse me, all these short, short terms. Fubo's lawsuit with Venue was really about Fubo wanting to offer a smaller package of channels to its streaming subscribers. So it is a streaming service, but it is still negotiating its own package of channels. And it said, hey, if Venue is able to offer its own skinny package just of sports, why can't we do the same? FUBA was always sports first, but in order to get these channels from these other media companies that included sports, they also had to pay for other channels as well. So for Fubo, it was a real disadvantage to not be able to really compete with Venue because they weren't offer able to offer just sports. And now they're saying, hey, we can now offer a skinnier package just of sports and even just of particular sports.
- [25:31]
Melissa Lee
All right, Julia, thanks. Julia Borson with all the details there, Guy.
- [25:36]
Dan Nathan
Well, I mean, Fubo, the stock has been fubar for the last couple of years. I mean, if you pull up a chart, I mean, today's move notwithstanding, I mean, this is flatline now for the last few years. With that said, Disney is the one that's interesting. Why to me, is because they've gone from playing defense now seemingly they're starting to play a little offense. Chris can speak to this. You know, we traded up to in November the same levels we traded up to in March. About 120 seemingly failed. But, you know, as we get closer to earnings, early February, February, I think Disney is a name that could surprise people to the upside.
- [26:07]
Guy Adami
It's a name we put on our list of real potential leaders in 2025. The stock peaked four years ago, peaked in March of 2021. It's been a 60% decline. It's been a devastating bear market. We've spent the last 18 months basing. I agree with Guy. You start to push this up through 120. It's a very meaningful breakout. So top on our list here.
- [26:27]
Melissa Lee
Coming up, United Starlink surge and Uber gets named a top pick. Why these two stocks are flying high today and if they can stay in the fast lane. Plus, a tariff tweak, Trump's potential shift in his tariff plans and the impact it's already having on some stocks. You're watching Fast Money live on the NASDAQ markets at Times Square. Back right after this.
- [26:50]
Karen Feiderman
And now a next level moment from ATT Business. Say you've sent out a gigantic shipment of pillows and they need to be there in time for International Sleep day. You've got AT and T5G so you're fully confident, but the vendor isn't responding. And International Sleep Day is tomorrow. Luckily, AT&T 5G lets you deal with any issues with ease. So the pillows will get delivered and everyone can sleep soundly, especially you. ATT 5G requires a compatible plan and device. 5G is not available everywhere. See att.com 5G for you for details. Weekdays at 5:00am Be first on world markets, first to the global business conversation. Get a jump on the investing day every day with Frank Holland. Success starts early. Worldwide exchange, 5:00am Eastern. CNBC.
- [27:40]
Melissa Lee
Welcome back to Fast Money. United Airlines topping the tape today after announcing Sunday that deployment of Starlink Internet connectivity on its flights will happen on an accelerated timeline. The company's entire main regional fleet expected to be equipped with the service by the end of the year. American also getting a pop today after a slew of bullish analyst calls. Calls Cowan slapping it with a street high price target of $25 up from its previous $8 call. Guy.
- [28:05]
Chris Verone
Yeah.
- [28:05]
Dan Nathan
And Jefferies, I saw that. What's that great show about the lunch at cnbc?
- [28:10]
Melissa Lee
Our lunch.
- [28:11]
Dan Nathan
Right. And they interviewed the analyst Kelly did and she gave a great explanation as reasons for upgrade. The top of the list being they're getting the higher margin business. They have the lower margins on the street. Good for American. And if you look, I mean, Chris can speak to this. It appears though we might be having this bearish to bullish reversal in American Airlines, a stock that's done nothing now for years but seemingly is turning the corner.
- [28:33]
Melissa Lee
Look is playing technical analyst Chris I agree.
- [28:36]
Guy Adami
I would swap them here. I mean UAL, you're up 100% since September 50 to 100, which is the old highs actually back from pre pandemic. 2019 is where the stock topped. American is kind of more nascent in its turn. The analysts are still pretty indifferent on it. We think it's really bottomed. I would play that one.
- [28:53]
Melissa Lee
All right, let's get to our call of the day now. Uber up more than 2 1/2% after Wedbush added the stock to its best ideas list for 2025. Analysts seeing a more favorable risk reward profile moving forward, helped by the company's expansion of key partnerships. Just the surge in travel too overall, as we mentioned, the airlines. Karen, that helps.
- [29:11]
Chris Verone
Yeah, I mean, I like Uber. I think that, you know, so much has been made of Robo Taxis just coming to take their lunch, no pun intended because they do delivery. And I do think that's maybe those fears are somewhat overblown. So I kind of like it, I think and I think dark is great, great CEO.
- [29:31]
Karen Feiderman
I think it's way overblown in the near term. I think that from the Robotaxi event with Tesla had, I think it was in October the stock broke out to new all time highs. I think a lot of the realization if you were there is that this is not happening anytime soon. You always take the over when they put Tesla, you know, some sort of estimate about when a product is coming out. You know, the stock went from 85 down to $60 now. It's since bounced over the last few days. This is a cheap stock. It trades at a discount to its EPS growth rate. And I don't think the fact that it trades at a discount, I think a lot of investors think that Robotaxis are going to be competition sooner than a lot of folks think. So I think there's at least a year, maybe a year and a half, two before Robo Taxi becomes a real threat to these guys.
- [30:10]
Melissa Lee
All right, coming up, a potential pivot on Trump's tariff plans. How the new approach could impact stocks and what aggressive tariffs could mean for inflation. The details when Fast Money returns.
- [30:23]
Karen Feiderman
Missed a moment of fast. Catch us anytime on the Go Follow the Fast Money podcast. We're back right after this.
- [30:39]
Melissa Lee
Welcome back to Fast Money Stocks pulling back a bit from an early rally. The stock the Dow up as much as 383 points before ultimately closing in the red. The S and P and Nasdaq holding on to their gains though. The S and P gaining half a percent and the Nasdaq up more than 1% as Nvidia closed at a record high. The Canadian dollar getting a small boost this morning as Prime Minister Justin Trudeau resigns as a Liberal party leader after nearly a decade in power. Trudeau also saying he will remain as prime minister until his replacement is chosen through a party election. And Staples seeing a pullback midday, losing more than a percent. And there were just a few days into 2025 the group is the worst performer in the S&P 500. Meantime, shares of Ulta jumping after hours though well off its highs. A cosmetics retailer increasing its fourth quarter outlook expects operating margin above high end, a forecasted range. It also said its CEO Dave Kimball is stepping down, being replaced by the current president and CEO. Karen, what do you make of this sudden news?
- [31:35]
Chris Verone
I don't love sudden CEO change without a little more description why that is, but to sort of soften the blow. They did talk about that the quarter was looking good, that margins will improve. So that's why the stock is up now. Keith Steele has been there a long time. I think it could be somewhat of a seamless transition, but I don't love that you get the gold standard of transition is Morgan Stanley James Gorman. I don't know why they don't do it like that. Something's up.
- [32:03]
Melissa Lee
Meanwhile, shares of GM and Ford hired today on hopes the automakers may be spared from massive tariffs in the new administration. The Washington Post reporting that President Elect Trump was considering narrowing the scope of the proposed levies. Levies, though Trump did deny that report. CNBC's Megan Cassell's got more on the state of play here. Megan.
- [32:22]
Megan Cassella
Melissa, that's right. A little bit of a bounce today after that report which said that Trump's team is slimming down his tariff proposals to focus only on imports deemed critical to national or economic security. The idea here is that tariffs would focus on specific sectors that Trump wants to bring back to the U.S. the post listed the defense industrial supply chain, critical medical supplies and energy production as three examples of sectors that could see tariffs. Now, people in touch with the transition team told me today that Trump's Commerce and Treasury teams have been interested in this type of narrower approach and that lawyers see this as on firmer legal ground than the universal tariffs because there's precedent here. Trump could use the same law that he used in his first term to impose those tariffs on steel and aluminum. But Trump himself, not completely on board. He posted on Truth Social that the story was wrong. But even still, as you mentioned, auto stacks up on that hope that car parts will not be hit with tariffs which would of course drive up their costs. I would add, though, Melissa, Trump did pursue a national security investigation into cars specifically in his first term. That was a move to protect domestic industry. No tariffs were ever imposed there. But one option that could still be on the table even in this sort of more slimmed down regime. Melissa.
- [33:33]
Melissa Lee
All right, Megan, thank you. Megan Casella, we should note that, you know, all of the sectors that would have been affected by universal tariffs were higher today. Not just auto parts, but like the dollar stores for instance, they popped on the back of this guy.
- [33:46]
Dan Nathan
I look at GM in June, I think of 2021, it traded up to $61 and then cascaded lower in November. We traded right back up to that level and then had a pretty precipitous drop off. So I'm concerned just on a technical basis here. I get the bounce today, but I don't think GM is out of the woods yet at all. And I think in order to prove itself, it needs to close above 60. I don't see that happening anytime soon. Soon.
- [34:08]
Guy Adami
I'm a bit more sanguine about GM here. I think the chart's fine. It's been in this long term uptrend. But I can't say that about Ford. I mean Ford has been a devastating bear market. It's closer to the lows. It was barely up today. But I think the really interesting price action on the tariff news was actually out of Europe. If you look at the European autos, BMW, Mercedes, really big turns which frankly have been developing over the last couple of months and the European luxury stocks, lvmh, Hermes, all real nice reversals there. I think those are names to put on the radar as maybe starting to bottom.
- [34:36]
Melissa Lee
Oh, you know, that reminds me of your acronym. Yes, Helm.
- [34:40]
Chris Verone
Yes.
- [34:40]
Melissa Lee
The L was actually lvmh. It was the correct. Yeah, it actually worked as lvm. But now Chris is saying it should be on your maybe it's in your new acronym for 2025.
- [34:49]
Chris Verone
Well, it's still in my portfolio in the doghouse where it surely belongs for sure. But I mean, one thing after another. You know the alcohol story the other day, that was good for another three or four bucks even though alcohol has been terrible for a while. I don't know. It's not going to be in my acronym.
- [35:08]
Melissa Lee
Oh, it's not.
- [35:09]
Dan Nathan
Wow.
- [35:11]
Chris Verone
It might be. Yeah.
- [35:12]
Melissa Lee
I'm not, I am not sure.
- [35:14]
Karen Feiderman
By the way, one of our producers, I think it was Natalie, said they're just waiting on Guy.
- [35:17]
Dan Nathan
What does that even mean?
- [35:18]
Karen Feiderman
Just waiting on guy.
- [35:19]
Dan Nathan
Now that's.
- [35:20]
Karen Feiderman
What did you do?
- [35:21]
Melissa Lee
Well, we had to do it by close of business today. It was close of trading today, I think because tomorrow we are unveiling it. This just ends. We're going to unveil the acronyms starting tomorrow. Tomorrow.
- [35:32]
Dan Nathan
I have an idea. I'm going to go for from clam to something calm. Well, that was originally, but Bonoin was calm one year. So I said it can't be calm.
- [35:41]
Melissa Lee
It's got to be clam.
- [35:42]
Dan Nathan
It's got to be clam.
- [35:43]
Melissa Lee
Another mollusk?
- [35:44]
Dan Nathan
I believe so. Or something in the mollusk sort of family type of thing.
- [35:48]
Melissa Lee
Squid maybe. Octopus is too long. All right, Brad. Coming up is a high energy rally in store for 2025. We'll go off the charts for a closer look at why natural gas could spark a comeback for the sector. But first, the skinny on what could tip the scales against obesity drug makers in this year. Health care checkup is next. More fast money into. Welcome back to Fast Money. A mixed showing for health care stocks in the new year's first trading days. The S and P Health Care ETF holding on to a 1% gain for 2025. But so far. So far, but still flat over the past year. Even the red hot GLP1 obesity category is cooling off. Novo Nordisk seeing especially steep losses since giving updates on its next generation weight loss drug Cagrosema. The stock erasing all its gains back to August of 2023. For more on where the trade goes from here, Mizuho Healthcare strategist Jared Holz joins us on the Fastline. Jared, great to have you with us.
- [36:48]
Jared Holz
Thanks so much for having Melissa.
- [36:50]
Melissa Lee
At this point, investors have digested what's going on in Novo Nordisk in terms of the disappointment with cargo sema. And that market share hasn't gone to the rest of the weight loss space. What is what's going on here in terms of the reevaluation of the multiples here and what is factored into the stocks?
- [37:07]
Jared Holz
I think the main issue is that we finally are in some sort of air pocket with respect to Catalyst for Novo. Right. They introduced a couple data sets in oral over the past, oral obesity medications over the past six months and then CAGLAR 7, which I thought was actually okay, just didn't look as good as the company had indicated to investors. And then I think the underlying problem with when you look at the entire obesity space is that the analyst community I just believe got overzealous with, you know, their out your estimates. 100 billion, 110, 120 billion. It just became difficult for the stocks to work.
- [37:51]
Melissa Lee
There's a JP Morgan note which Karen had sent around to our team here today which cited some data saying that Ozempic, Wegovy, Rebelsys, the users discontinued use within one year. And I'm wondering if you're seeing that same sort of data and if that makes you extra concerned about Novo versus Eli because there is a great disparity in terms of the stock performance.
- [38:13]
Jared Holz
I'm actually not that concerned. I think when you kind of examine this whole space and you do work on how patients are faring on the medicine, the one thing that keeps on coming up is when patients reach some certain weight loss or they attain their goal of how much they wanted to lose, there is a high chance or a high probability that that they start to wean themselves off the drugs either by way of a doctor or self medicating. And I think when you kind of take that into consideration, you still don't really know what the average length of a patient staying on the drug is. And I'm fairly confident that we're going to see a lot of patients go on and off the drugs maintaining their weight. So I'm not so concerned about patients finishing the drugs. What I would say is that once you've reached a 20% weight goal or whatever it is it may be the likelihood that you come off for some period of time is high, but then you probably go back on it. We're just not, we're not deep enough into the launches to really know what the average patient's going to do.
- [39:19]
Karen Feiderman
So.
- [39:20]
Chris Verone
Jared, it's Karen. Thanks for being on. So drawdowns in both Lilly and Novo. Which do you like better?
- [39:28]
Jared Holz
I like Lilly here better mainly because they still have the optionality of an in house oral weight loss medication. We're going to get that data during the first half of the year. I think that's important to consider just given some of the issues Novo has had with their program. And I'm just again, I'm not really sure Cagrosema is not a drug. The data were fairly good in a vacuum, but I think they need to really regain investor confidence. So I like Lilly, but I know that the street believes that both companies might underwhelm in terms of how the fourth quarters are looking.
- [40:05]
Dan Nathan
Jared, when does Merck get out of the penalty box? And is Viking traded low enough where somebody's going to gobble them up?
- [40:12]
Jared Holz
What's up guy? Yeah, I think Viking's Interesting. Mainly because of their oral. You know I think like the injectables at this point might be solved for. They're really going to have to prove product on their own. But I think there's probably enough value in the oral for the stock to start working if the data continue to look good. That's really where I think that company finds itself in the market. As far as Merck, I mean the Gardasil issue, the issue the street is begging them to do more M and A so I think unfortunately it's going to have to be business development.
- [40:50]
Melissa Lee
Jarrah, great speak with you. Thanks.
- [40:53]
Jared Holz
Thank you.
- [40:54]
Melissa Lee
Jared Holes Mizuho how does the charts look? Novo in particular?
- [40:58]
Guy Adami
Well I think Lilly in particular is the one that's really in trouble here and I mean I can come up with a six hundred dollar target on Lilly here. It's been topping for the better part of a year now. I do think Merck actually might be interesting long you've had the pretty devastating bear market there. 100 has been very long term support for many many years. Wouldn't be shocked if that bottom tier.
- [41:18]
Melissa Lee
Coming up Act Natural Nat Gas outperforming crude in a major way over the last few months and Chris has his picks for some under owned names just bursting with energy. His picks next More fast money into welcome back to Fast Money. A frigid forecast with a big part of this country this week. Parts of the US under winter storm watch as freezing rain and heavy snowfall makes its way to the east coast. The cold sending natural gas spiking again. One trader here thinks the commodity is showing signs of even more life ahead. Chris, what do you see?
- [41:55]
Guy Adami
Well it's a theme that we've been on here for a couple of months so it kind of predates all the cold weather. I think natural gas has been improving and basing really for the better part of the last six, seven months and these equities are really now starting to get in gear. You're seeing the leadership really start to emerge. Three stocks in particular stand out here. One is EQT really starting to break out after about a two and a half year consolidation. Remember all these peaked around the energy top in early 22. So they've kind of spent their time in purgatory. They've turned 60 on equity I think is an appropriate target here. But more importantly it's really starting to outperform. It's outperforming the S and P which is a very very high bar. Antero Resources air is the second one. 45 would be our target there. And then lastly Baker used. It's already broken out. It's really been the leader in this group. I think it's best of breed in terms of these natural gas stocks. Would certainly be long there.
- [42:49]
Melissa Lee
Yeah.
- [42:50]
Dan Nathan
Karen Cheniere. I think it was within a dollar or so of an all time high.
- [42:53]
Melissa Lee
Like many like a decade.
- [42:56]
Dan Nathan
But I think large still. I think of Karen when I think of Shanier.
- [43:00]
Chris Verone
Thank you.
- [43:01]
Dan Nathan
I think of Karen often. But that and equity. Absolutely. I think. And throw Devon in the mix as well. Which seemingly again, one of these bearish, bullish reversals. Nat Gas story is real. I mean back in the day we used to call it the Widowmaker. And having more than doubled now since the spring. You know why?
- [43:16]
Melissa Lee
When. When was the last time you owned Cheniere? 10 years ago.
- [43:21]
Chris Verone
But Golar I have owned for a super long time. They are in the LNG liquefied natural gas transportation.
- [43:26]
Melissa Lee
Right. And that is the ticker.
- [43:28]
Chris Verone
Glng. Yeah, go.
- [43:30]
Melissa Lee
Yeah. Yes, go along, Chris. What else are you seeing for the energy space, which was a dog in general. Yeah, it's funny.
- [43:36]
Guy Adami
So it's the one sector where the equal weight composition of the sectors is actually doing better than the cap. We mean everywhere you look it's cap weight over equal except energy. So the average energy stock means it's outperforming Exxon, Chevron, all the big ones. I think that's an important psychological shift within the group. Crude, you know, back to a tough spot here though. You know, crude rallied right back to the 200 day moving average. I think the trend is neutral. I wouldn't press my luck in oil stocks.
- [44:00]
Melissa Lee
Are you putting an oil stock into your acronym?
- [44:03]
Guy Adami
Thinking about.
- [44:03]
Dan Nathan
Well, first off, to come up with an acronym which is a word made up of letters. Right. And I typically do like words are.
- [44:08]
Melissa Lee
Usually made up of letters.
- [44:10]
Dan Nathan
And that's a fair play in the.
- [44:11]
Melissa Lee
English language at least.
- [44:12]
Dan Nathan
Well, I mean last year we learned differently though. There were some acronyms.
- [44:15]
Chris Verone
Good point.
- [44:16]
Dan Nathan
But I think, yes, there might be an energy play in there. Chris might have actually just said inspired me.
- [44:22]
Melissa Lee
Interesting. Eqt I think.
- [44:24]
Dan Nathan
Look at you.
- [44:24]
Melissa Lee
That's my guess for you.
- [44:25]
Dan Nathan
That would be the E in whatever.
- [44:29]
Melissa Lee
You can only wait to find out. Up next, final dream. Time for the final trail. Let's go around the horn. Chris Verone.
- [44:45]
Guy Adami
We talked about it. Natural gas has turned long.
- [44:47]
Melissa Lee
Eqt Karen.
- [44:49]
Chris Verone
Yes. Welcome back, Melissa. We missed you.
- [44:52]
Melissa Lee
And you missed us. I actually did miss to her.
- [44:54]
Chris Verone
Great surprise. All right. I love it. Xle all this energy talk Dan.
- [45:00]
Karen Feiderman
You know, I was gone for like 10 days. Nothing. Crickets.
- [45:03]
Melissa Lee
But it's fine.
- [45:04]
Karen Feiderman
I missed you guys and now I'm back. I like the Uber call here. I use like a 60 stop on that.
- [45:10]
Dan Nathan
You did nothing.
- [45:11]
Melissa Lee
I did. Come on. I did. I did.
- [45:14]
Dan Nathan
Did you text Karen and say I miss you?
- [45:16]
Melissa Lee
No, no, we did speak.
- [45:18]
Chris Verone
Yeah, that's.
- [45:19]
Dan Nathan
That's adorbs. People should know, like, you go home after the show together thing.
- [45:24]
Chris Verone
Yeah.
- [45:25]
Dan Nathan
American Airlines smell. I think it's breaking out.
- [45:28]
Melissa Lee
Thank you for watching Fast Money. Chris, great to have you on the show tonight. Mad 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, NBC Universal, 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.
- [46:20]
Karen Feiderman
Global markets up to the minute, Front page news. Wake up to Frank Holland and worldwide exchange. Weekdays 5am Eastern. CNBC Live. Ambitiously.