software leader, and an apple, a systems leader, all vying for the crown there. >> yeah, it's really those, and the rest here. we did have another record close for the s&p 500. 31st one of the year, as well as the nasdaq. another record. that's going to do it for us here at "overtime." >> yeah. "fast money" starts now. live from the nasdaq market site in the heart of new york city's times square, this is "fast money." here's what's on tap tonight. no mas? shares of restaurant stocks keep surging. retail sales showed the spending slowdown has started will this put an end to the blowout moves in the sector? plus, shaking my head. the semi etf continues its epic climb. we'll break down the staggering g gains that's been posted less than a month after earnings. and later, no reclining for shares of la-z-boy. inside the record-breaking streak at netflix. and boeing on the hot seat.

the fireworks from today's hearing on capitol hill. i'm melissa lee, coming to you live from studio b at the nasdaq. on the desk tonight -- tim seymour, karen finerman, \ bonawyn eison, and steve grasso. the s&p has set a record 31 times. that is better than 26% of the time, not bad. but even with those gains, we start with the latest reminder that it's nvidia's world and we're all just living in it. the semi giant jumping 3.5% today, closing at its own all-time high. the stock up 42% since its earnings report less than a month ago. for those not keeping track that's a gain of nearly a trillion dollars in market cap. bigger than all but six members of the s&p 500. one more milestone here. the a.i. darling now the most valuable company in the world, stealing the title away from microsoft today, trailing apple, not far behind. so, is there any stopping this stock? it seems almost folly to try and

think of when nvidia is going to stumble, day after day when we see these records being posted. >> i think so. and i think that earnings result, which is now about a month ago, gave you kind of the relief to buy signal. and it gave you the buy signal in terms of the broadening and deeper look into the product line. i think where people are trying to reassess technical aspects of the market. and that means how much of semis do i really need to own? it's one thing to own the triple qs, people looking into internet technology, or i.t. across the board, but i think semi is a percentage of that. if it's micron, which is making fresh new highs, taiwan semi, who just gave us -- gave may supply chain numbers, where, after an incredible april, may was up 3%, 21% year over year. the cyclicality of cyclicals, in terms of what typically have been semiconductors, is very strong on top of just the dynamic. a 40% semis in 40 days, the

outperformance is extraordinary. and what's to me the dynamic is that the market is looking for weakness to buy. and i think there's a ton of people out there that would love to see that weakness. >> karen, this is a holding of y yours. how uncomfortable are you? >> fairly uncomfortable. it's not just nvidia. i have dell, which we've seen is highly correlated, and then, i have, you know, google is a big position, meta is a position, amazon is a position, so, all of those will be riding -- flowing in the same current, right? if the tide goes out, those will go down, as well. so, that concerns me. i have some hedges, but i'm always long, i clearly have exposure here, i did buy some nvidia puts last week, those are worth a lot less than i bought them for. >> and that's okay, by the way. >> that's fine, right. it's insurance, i'm happy to, you know, have it not kick in, but i also sold some upside calls. i took off some dell spreads today, and i do really believe

we're still in early innings of a.i., i don't necessarily think we're going to track it exactly, right, it undervalued and overvalued various times. i'm sensing we're in the overvalued right now, but i don't -- i'm not trade at trading around these things. >> and it's not sort of indiscriminate of all a.i. trips. look at amd. they cannot get out of its own way. it's up 4% year to date, compared with -- >> yeah, i do have a little amd, as well. >> i bought some today. >> i was very late to -- well, i was early years ago to nvidia, and then i -- the set scared me and i couldn't buy it. i bought it last week. and i thought i was extremely -- i am extremely late. i bought it last week and i said, i expected to have a losing position on this this week. always happens. you buy it and you think, that's the top. i did think that the announcement of the stock split was the top in the stock, because i felt pulling that lever was sort of late in the -- in the game, you could own

fractional shares with any type of program that you can buy stocks in, i don't think they really needed to do that. i bought it and now there's another street high of 160 price target on it. it's probably going to continue the ascent higher. this one will run, as well. i am looking for a pull-back. everything can't be -- i've been bullish, but i've been a realistic bull. i think that you have to see some sort of a pull-back, but fighting the seasonality of extremely bullishness in the summer is very tough to get the pull-back, but i still think we're going to get one, and that will be your opportunity, as tim said, when you see that dip, people are going to still be rushing in, i'm in it now, and i know i'm late. >> by the way, $160 is not the street high anymore. $200 out today. >> yeah, i'm with you. i think the -- my order of operations are just slightly different. as long as nvidia and the other six magnificent seven continue their path forward, the market

will play nice. so, i'm with you in terms of, i think those things will happen in conjunction, but they will be the tail wagging the dog there. and in terms of some uneasiness, i think that's really kind of the secular shift that we're seeing in this day and age of investing or trading, however you want to define it. you're going to have to be comfortable with a much more concentrated portfolio. that's where your returns are coming in. i think that's why passive, the passive versus active type of argument that we've had recently, we have recency bias around why those have done so well. we get a larger concentration of those names. that's where you're really starting to have to measure your risk and reward. i like the put buy, you know i'm an nvidia bull, but i still like it in terms of hedging, because so much of your returns are going to be determined by a handful of names. i'm with you, i like amazon, i think they probably end up being much more involved in streaming. i think they're a cloud and retail giant. there's other names that you start to like, but you have to really be comfortable, like, kind of getting far out over

your skis away from what traditional portfolio construction would really indicate you should be in. >> what we were talking about yesterday, julian emanuel -- >> 4600 to 6000. >> we were talking about fomo, talking about, mid-year here, and people are feeling a little bit behind. and so, to your point, in terms of passive, active managers are feeling the same pressure. they also have to be in these concentrated positions or they are not going to be performing. so, there's all that. so, does that make you more confident that this run can continue, or does that make you more scared that when it's time to hit the brakes, boy, a lot of people are going to be rushing for those exits. >> they're incredibly crowded trades. the passive component of it is the point that makes me think things can go higher. it goes back to what i was saying before, i don't really know what percentage semis should be overall of the 30% weighting in the s&p of where information technology, or i.t. is. we look at weightings, i think -- there's a recalibration

going. i think people are ready to be overweight. and if you look at where we've been over the last six weeks getting numbersfrom everybody from intel to broadcom to micron, and they've all told a slightly different part where they're active. with amd, it is that much more fascinating, because up until three months ago, this was toe for toe or step for step, whatever, right there with every other big a.i. story. in the semi space, down 16% over three months, i nibbled some amd today. i think it's a case where, the headlines around the security breach, things that could be scary. they certainly don't resonate well for a tech company like this. but it's really more about, people are concerned whether they are taking share, and i think for them, server share is really important, data center, if they can take share. we know where they sit as a second place play, but i don't think you're counting them out. and i think this is an opportunity for people that are looking within that space and a,

what's underperformed. >> how do you feel about your position in amd? >> not great. i didn't really love -- i didn't buy it today, i bought it before today. lower than here, but that doesn't matter. you went home long, you know, whatever price it closed last night. i love lisa su. it's not cheap. it's not cheap. it's not as if they're priced like they're an also-ran. that's probably the one that i think is the most shaky valuation. >> right. >> how about micron, tim mentioned opening of the show, micron is d-ram. it's synonymous with d-ram. if there's going to be an a.i. push and a storage push, you need more d-ram. that is the most unsexy player, that's one i bought, and let go way too early. and this one -- now you start to see analysts really start to push this name. start to push d-ram, start to push the storage aspect of it. but this is probably one that's going to garner a lot more bullishness going forward and it's already had an incredible run.

>> did you catch the action in broad come today? new high on broadcom, very heavy volume, finished the day lower. and you have to wonder, if you're going to look back on this day, say, that was the turning point for broadcom, ahead of its stock split. >> guy would say -- >> he would say outside reversal. >> yes. so, we'll watch that one. meantime, let's turn now to the latest signs of strain on the consumer. retail rises just a tenth of a percent in may. sales were actually down in may excluding autos. that's after a preliminary read came in at its lowest level of the year. discretionary stocks are among the worst performers this year, lululemon, tsy, ulta beauty down in 2024 while the s&p is up double digits. and in thel lrestaurant stocks, starbucks and mcdonald's under pressure, but cava, wingstop, chipotle at all-time highs. we saw evidence already in today's print that the run is

going to slow down, at least at this point. that's what it sounded like. >> well, when you're karen's cava, and the example is cmg, which can be -- can certainly support a 50 times multiple. that's the story of cmg. i think the question is, as you get into fast casual, or, as you get, you know, in different nuances and pieces of this entire space, the question is, where are we with the consumer running out of gas? i think in the cmg side, it's at some point just the growth is very difficult to attain, and to keep this kind of a pace going. but i'll say that they're going to survive in a world where we've had higher inflation and their prices on a relative basis don't look that bad. i think mcdonald's continues to struggle. i don't own it here, i want to buy it lower. and same with starbucks. i think they are both really dealing with cost issues. inflation for them hasn't really abated to a point -- they have zero pricing power. the whole point is, i actually -- i don't know if i've seen any price cuts at starbucks, but i can see they've

stopped raising prices. mcdonald's with their $5 meal, going toe to toe with burger king and everybody else. the retail sales numbers, discretionary, i continue to believe discretionary gets worse before it gets better. >> i think you continue to like the tradedown names, like a walmart, tear i say a target, if they are able to get inventory corrected. t and then, on the cmg side, another stock split, 50-1, this definitely has a signaling effect, but we should not understate the psychological effect that seems to be surrounding these stock splits. whether you can buy frx fractional shares or not, there is a cohort that still looks at the dollar figure and feels compelled, or, you know, or at least -- they feel like they are able to afford a share or two, as opposed to a fraction, and all the mental gymnastics that go with that. i'm not sure where the incremental growth comes from, but in digging in and looking at the financials, still over a billion dollars in free cash

flow and zero net debt. it's tough to really bet against a company that's structured that way, whether or not you believe the next incremental percentage of growth becomes harder and harder. >> all right, for more on whether the restaurant stocks will see a reckoning, let's bring in nick setyan, from wedbush. nick, great to have you with us. >> thanks for having me. >> you've got a neutral rating on cmg. what are you worried about? people love the stock, they've got pricing power over the consumer, even though that's sort of running out a little bit. people are still paying. >> yeah, so, i mean, my -- the reason why we're neutral and why we went to neutral last quarter was because we were worried about the second half comparisons, you know, at the end of the day, it's priced for perfection. if we start to see transactions start to decelerate two and three-year basis, it's going to be difficult, at least in my opinion, to hold these multiples. we haven't seen it yet. the chicken al pastor is doing

well. you have a lot of initiatives. at the end of the day, you're going to have to anniversary carne asada in the second half. >> i was worried about that anniversary. all kidding aside, can't they think of something else? they can bring back carne asada. mcdonald's does that with mcrib. i joke, but if it's so well-loved, can't they sort of manage those comparisons by bringing things back? >> well, you can, you can bring things back, but they have to do, you know, even better than it did the year before, right? so, the carne asada in q-4 was going over a garlic steak, which was a disaster the previous year, so, they had a very easy comparison. and now, if you bring back the carne asada, it going against that very successful offering this year. so, you almost have to do one better than what you did last year, and now, we have almost no pricing, particularly in the second half, so, all of the comp

has to be transaction growth, and all of that transaction growth is going to come from essentially through-put initiatives at this point. >> nick, it's karen. so, just furthering that point, in terms of there being more profitable, more efficient, are those levers that we can pull that you think would actually have an impact? >> yeah, i mean, commodity crafts have to behave. we can't have outsized avocado growth. they're not in a -- >> i mean, like, on the line, when they make, you know, how -- you know, whether it's, what's -- not skinning the avocados -- >> the auto plcado, all along t line. >> right that's what we talk about when we talk about through-put initiatives. they have been driving that line faster, but there's also some blow-back around that, as well, right? we saw in terms of the social, you know, media kind of

push-back, negativity around, you know, portion sizes, and where pricing has gone, that's kind of a two-edged sword, as well. so, i mean, those are all the things that they're doing now to try to move that line along faster and faster. that was a big contributor in q-1. it's going to be big in q-2. if question is, how much of a contributor can it continue to be as we go into the second half? >> all these concerns with cmg sound very cmg-specific. but when you hear the retail sales number this morning, that spending at restaurants and bars down 0.4%, that's the most since january, how much, you know, how worried are you for the overall space? do you think that's going to translate into a tougher quarter for a lot of these stocks? >> well, we're definitely going to have another very tough quarter across the industry, just like we did in q-1. there's literally -- the number of names that we can say have positive transactions, you can count on one hand at this point. you know, chipotle is obviously one of them, which is why you're

seeing, you know, everybody kind of crowd into those four or five names. and you're seeing the kind of multiples that we had out there for those four, five names, cava, chipotle, roadhouse, domino's, and essentially wingstop. that's the end of that list. you can throw brinker in there, as well. more of a kind of near-term marketing spend issue there, than a structural win, but those are kind of the names, and the list ends there. almost everyone else is in a very, very tough position, relative to expectations. >> all right, nick, thank you. nick setyan of wedbush securities. so, what do we think? do we want to crowd into the ones that are executing? >> yeah, i think so. but if you look at the list that nick just said, those are the names that don't have -- they don't have an international presence yet. so, when you look at chipotle, they're trying to add 200 to 300 u.s. stores, but they're still under 100 international stores. so, all the names up on that board have a huge international

growth prospect to them. the other ones are too mature and they don't capture that growth. that's why they're crowding into those. >> what's interesting, names like domino's and things that have been very resilient, with an international profile, are ones that are struggling a little bit here. and so, that -- those have been places where you've had resilience across the demographic chain. i mean, the fact that we -- you know, asada and pastor are part of our lexicon, you know, it tells you what chipotle is doing. it's extraordinary. what is pastor? what is that? when you are doing a pastor -- >> chicken -- it's got pineapple in that. >> did they invent that? >> no, no, no. mexican -- you go to a mexican restaurant -- we'll have to do a "fast money" outing. >> we're supposed to know what pass otor means? >> we live in new york city. >> i like it, i order it, we don't know what it means. >> when you order, it's unusual -- >> it's tasty. but asada -- anyway, i'll stop.

>> all good. coming up, boeing on the hill. ceo dave calhoun personally apologizing for the company's safety shortcomings in front of a packed senate hearing. but will the remorse be enough? some afterhours action in kb homes. the numbers, the latest headlines from the earnings culture right after this. this is "fast money" with melissa lee right here on cnbc. what took you so long? i'm sorry, there was a long line at the thai place. you get the sauce i like? of course! you're the man! i wish. the future isn't scary. not investing in it is. nasdaq-100 innovators. one etf. before investing, carefully read and consider fund investment objectives, risks, charges, expenses and more in prospectus at invesco.com (vo) what does it mean to be rich? investment objectives, maybe rich is less abouts reaching a magic number...

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if anybody's coming out of this deal good, it's you. why haven't you resigned? >> senator, i'm sticking this through. i'm proud of having taken the job -- >> proud of this record? you're proud of this safety record yo record? >> i am proud of every action we have taken. >> every action you've taken? >> yes, sir. >> wow. wow. there's some news for you. >> that was boeing ceo dave calhoun and missouri senator josh hawley in a tense exchange over the plane's safety culture. the ceo getting grilled today in a senate committee over boeing's handling of incidents. calhoun kicking off his testimony by apologizing directly to the families of

whistle blowers and 737 max crash victims. he stood up from his chair, turned around and faced the families. for more, let's bring in sheila. >> thank you for having me. >> that was surprising how he answered that. should he have answered that way? >> i don't know. senator hawley came in pretty hot. i would not want to be questioned by him, if anyone, but i think the reason he hasn't stepped down yet is, we are having trouble finding a new ceo. that seat is still open, and nobody seems to be wanting the job. >> yeah. it's a thorny issue, it's a thorny problem that boeing is in the midst of, including potentially prosecution, and you write in your note that you just put out after -- after today's hearing, that prosecution is quote unquote uncertain, quoting senator richard blumenthal, who called this entire hearing. what is your take on the violation of deferred prosecution agreement, and what the various outcomes could be?

>> you know, i think boeing will probably face another fine, just given the timing of the alaska incident and the last settlement they had about three years ago. but i think, you know, the key theme from this hearing was, there needs to be more personalization in the ceo job, but it's hard to do that. how do you do that when you have 170,000 employees? how do you hear them all out? how do you do that when you have millions of parts on the 787, like calhoun said? the hearing questions were hard, but i got to see another manufacturer yesterday, and i think safety can be done on the aircraft, and boeing's safety culture is in question. they're trying to turn it around, and the new leadership is going to have to infuse its stake into it. >> why are you so bullish on boeing at this point, when things seem so unclear? >> we actually just published a note today on why we're so

bullish on the cycle. despite all the headlines we're seeing, and negative p preanno preannouncements, american, some distributors are preannouncing negatively, this is a global duopoly. there's only two in the world, and air traffic is basically at 2019 levels. so, we've had five years of flat lining and underproduction. so, we're quite confident that the market demand is there, and as long as the supplier can supply, they could gain price, as well, and that's our underlying thesis. unfortunately, with boeing, what's happened in the last four years, why the stock has not worked, they have not been able to produce the planes. >> sheila, it's tim. i share your bullishness, although it's been a frustrating move. i guess if we had traded this aggressively over the last four years, there was money to be made on both sides. no one does that perfectly, but i'm looking at your note, and i want to cut to free cash flow, or cash burn, because that's the story in a nutshell, to me, and obviously '24 is a difficult

year, i saw from your note you think q-2 burn could exceed q-1. where do you think this inflects, and why does it inflect, even though you would think it eventually has to? >> it's easy. you just look at 737 max production and boeing's share price, overlay them to each other, and it's essentially a perfect correlation. we think boeing generates about 10 million of free cash flow with the 737, each of them they ship out. they were supposed to be doing 500 this year, now the number is down to 400, and probably pressure on that given what we've done over the last five months. they need to produce the maxes, but they need to do that without price concessions. we think the price per max doubles to $20 million. dave calhoun is right, he hasn't been generating profits over his tenure, and part of this has been the con sessions that have been placed in the backlog, so, they need to produce 737s, they need to do it right to customers, and they're having some new issues with the max certification on the seven and ten variants, there's four variants, if you recall. >> if they're found -- if there

is prosecution under the deferred prosecution agreement, they're found in violation, sheila, is there anything about that agreement, and further prosecution, that would impair their defense business or not allow them to sell, you know, defense to the united states? >> i'm not a legal expert on that, but i will tell you the defense business is not in a good spot in itself. they have about five problematic programs at the moment where they're delivering products at a massive loss to the government. >> so, i doubt the government is going to pull that back because they're getting free product on the defense side, as well. services is the only business that's generating very nice profits at the moment. >> all right, sheila, thank you for joining us. >> thank you for having me. >> karen? >> it's a bold call, which i like, and as tim always says, you make the most money when things go from terrible to just bad. with all of the sort of structure of the bullish case, which is the duopoly, why not

just go into airbus, right? it doesn't seem crazy expensive relative, so, it seems like -- if that holds true that thesis, it should work for airbus, as well. >> and they're taking share. boeing is losing share, they can't find a ceo, what are they going to do with the 737 max? there's a possibility they have to ditch this plane and build another one, and talk about cash burn? how much cash are they going to burn? there's no light at the end of the tunnel. i get that it's a duopoly, but the other side is taking share. >> it's really a ding on their balance sheet. >> for all the reasons that steve just stated, i just think that sentiment can't possibly get any worse and everything has been priced in. and i go back and look at 2020 numbers where things got really terrible. and you do see some improvement

from there, so, i'm using that as my bogey to see how bad things can truly get. again, i think sentiment is negative, i think everything has been priced in. i understand the duopoly argument, but it's a national security defense argument, as well. and that aspect, i'm unwilling to write to zero. even if just that is there, i think the price starts to make sense. clearly, i wouldn't die on this hill in terms of establishing a core position, but i do think there, you know, there's a situation where i just don't see how things get materially worse. you don't have any leadership. old leadership is being questioned. you're being turned down, you have, like, all of this -- all of these things that are essentially on the horizon, and if you look at a market that, to me, is getting to be overvalued, i want to see a situation where there's, like, a bellwether that i can establish a position in. all right, there's a lot more "fast money" to come. here's what's coming up next. >> a hurricane just hit the real

estate trade, says one top insider. we sit down with jonathan litt to talkle th the winds slamming sector, and what opportunities may exist when the storm passes, next. plus, what's wrong with energy stocks? even $80 oil is failing to gas up the sector's equity names. could a high energy rally be building up understood the surface, or is this trade d.o.a.? you're watching "fast money," live from the nasdaq market site in times square. in times square. we're back right after this.eig. in high-absorption magnesium. we're back right after this.eig. nature's bounty. it's in your nature. (office chatter) is it me...or is work not working? at least, not the way it could work. your people are buried in busy work. and you might be thinking... can ai make it all work?

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welcome back to "fast money." let's take a look at some of today's fast movers. la-z-boy soaring, after posting a blowout quarter before the bell. the furniture company crushing analyst estimates on the top and bottom lines. bitcoin falling below $65,000 for the first time in a month. near 5% since the beginning of june. and shares of trump media plunging afterhours. the stock is down close to 12% right now. the company releasing an updated s-1, saying exchangeable warrants held by certain shareholders could now be exercised. that could result in nearly 21.5 million shares coming onto the market. karen? >> well, up to 146 million

shares now eligible. so, it looks like they filed -- so, what happened, you file a registration statement, the s.e.c. has comments, you go back and forth. somebody probably had the sense it was getting very close, they filed another amendment this morning and then it cleared tonight. so -- probably a little bit of leaked information there, or something, it just happens, more generally, but this is a tsunami of stock that needs to find a home. coming up, kb home on the move after its latest earnings report. the numbers the headlines, the implications for the housing trade next. plus, our next guest is saying a hurricane is hitting the real estate trade, but could there be any opportunities amid these heavy headwinds? we'll dind inve into the eye of storms right after this. missed a moment of "fast?" catch us any time on the go. follow the "fast money" podcast. we're back right after this. ♪♪ ♪♪ ♪♪

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welcome back to "fast money." an earnings alert on kb homes. shares are off after a top and bottom beat. t dianea olick has more. >> yeah, melissa, deliveries

were down compared to a year ago, net orders up 2%. we just got q-3 revenue guidance on the conference call. a range of 1.$1.65 to $1.75 billion. that's a little bit lower than expected. the average selling price increased to $483,000 from $479,000, and they said on the call that that offset the cost of mortgage concessions, which were flat quarter to quarter, but 60% of buyers having some concessions. ceo jeff mezger said, "buyers remained resilient in their desire for homeownership despite the volume actual oi in mortgage." kb skups to the first-time buyer, so, it's built to order model appears to them on a lower budget. and kb significantly increased in investment and land acquisition, so, that speaks to

expansion. >> was the pace of sales, did it increase throughout the month of may, as we saw mortgage rates subside a little bit? >> well, they don't do month to month, they didn't say that exactly, but they saw sales increase, obviously, but they did talk a lot on the conference call about this built to order model, which a lot of builders will do just a spec model, but with kb, they give a buyer an opportunity to lowerby choosing lot of elevation, whatever's going into the home, and that gets the budget down. so, that helps them a lot. >> diana, thanks. steve, where are you in housing these days? >> so, the problem i have is that the housing prices are not coming in, and rates are not coming in, so, that's a double w whammy for them. it's still a thing. and until mortgage rates come in, both commercial and residential is going to be a headwind. you could pull rabbits out of a hat and have one, two quarters, but ultimately, rates have to

start coming in. >> all right, kb home posting positive numbers, but our next guest sees more pain for commercial properties. jonathan litt is here with us. the hurricane is in full-force, you say, specifically for office space reits. so, what is it that has, you know, before i think you talked about the hurricane landing or it's coming, it's on the horizon, but now it's in full source, so what happened? >> i want to be clear, it is office. most of the other office -- sorry, real estate categories are healthy, but office is really in a fierce storm. and what's happening is, we talked about in the past, financing has become almost nonexistent. and we have a demand problem from tenants and we have a financing problem, and the assets that are trading, i was listening to the recap of kb, the sellers are providing the financing. and so, you don't have market

rate financing, because banks aren't lending. the seller is saying, we'll give you discounted interest rates, 65% loan to value, and so, really, the sellers not selling, they're hanging only the office building. >> so, capital sort of adores a vacuum, and we're in a bit of a vacuum right now. how do you think you get to the sort of place where financing and transactions start happening, even though it may be at a much lower rate than purchase price or current marks or whatever it might be? >> i think the sellers don't really want to take the big hits, and the sellers are providing the financing. and so, they can keep marketing their books appropriately. without taking the big hits. i think this is going to take ten years to play out. you know, i was looking at a statistic before i came on, there's 2.5 billion square feet of space expiring by 2030. most of that was written before the pandemic. as that space rolls, and we've seen this since the pandemic, people are taking 15% less

square feet, because less people are in the office. so, that's another 400 million square feet of vacant space to come in a 20% vacant market in the u.s. rents aren't going up, rents are going to be going down. operating expenses are going to be eating the landlords alive, and, so, the fundamental outlook is not good. the financing outlook is not good. i don't know who really steps up. i don't think the banks are going to be stepping up. they want to get these off the books, they don't want more of it on the books. so, i think it's going to be a long, slow bleed, and, you know, unless everybody has to go back to the office, which does not seem to be happening. >> jonathan, first of all, i remember when you were coming on a couple years ago, you guys do such interesting work, which included going through cell phone records of tenants in buildings and just to understand what traffic looked like, so, you've called the hurricane. as an investor, and as an activist and something that's not afraid to get in there, what's the next move for you?

how much are you pressing these shorts? where are -- i mean, there are zeros out there, and so, that's, you know, obviously very gr gratifying. i'm kind of curious how your game theory is here. >> sure. after the banking mini-crisis we had last spring, these stocks got destroyed, there was no market cap left. so, shorting traditional office became, you know, less attractive. we did short and we talked about it in the past and we remain short. an office lab company. it's still, i think, incredibly overvalued. the fundamentals are gotten worse, and i think we have a chart on this, with the availability of space, has hockey sticked worse. availability has gone from call it 10%, 12%, to over 22%. since i was on the show last year, that's gone up by four percentage points. boston, which is the largest market, is seeing negative absorption, and they have 9 million more square feet coming online. it's overvalued.

this is going to be bleeding out for years. we do need new drugs, and we are seeing financing for new drugs come about, but people don't need to be in the lab to do it. people are looking from home, they go to the lab for a few hours, they come back home. the tenants are seeing this trend. they're going to shrink their footprints as these leases come due. the cell phone records maintain about 50% of the cell phones in the buildings today versus pre-pandemic. and as long as that continues, there's a glut of space. >> so, we're showing the facts for alexandria, which is your major shortposition, the lab space company that you're talking about. it's flat over thepast year. so, what is that moment of reckoning? what are we waiting for in order for that to trigger to the downside? >> sure, and it's been an interesting path. it went down a lot, it's come back. and it's off a bit from where we were. and we need to start seeing it show up in their earnings results. they've got a very substantial development pipeline, which allows them to have earnings which don't quite reflect it

yet. but we think this is going to get reflected in earnings in coming quarters and years. >> do you engage with management? >> we do. >> do they engage with you? >> we were having a conversation in the green room before, and -- they do. and, you know, the ceo thinks he's going to win and i'll wrong and i think i'm right and he's wrong. so, we'll see where this plays out. >> open invitation for the ceo of alexandria, we've invited them in the path. jonathan, great to see you. how are you thinking about office space reits versus apartment reits? >> jonathan said, it's specific to office space, but when you look at this maturity wall, $4.7 trillion over the next, what, five years or so, and you see how much is -- we're really hitting the wall in this sector, it's another trillion next year. so, this is going to be an

ongoing conversation. >> i think what's different with office and some of the other, you know, retail, particularly multifamily, is that you're seeing much more propensity of the banks to take control and actually manage and operate the asset. that's drastically different than what we saw in the last housing downturn, where essentially you're turning in the keys, you're looking, you're auctioning and liquidating assets. so, i think there's a bit more staying power in terms of where the marks will be in thor assets. >> i think it's going a lot lower in office, and again, jonathan and his team have kind of made this call for a few years. so, it's not playing out overnight, but you know, back to retail, i mean, if you look at some -- whether it's spg or some of the other players that have high quality stuff, you know, this is not a place, i think, speculators have had a lot of luck and i think they're going to be resilient here. >> i'm curious which will be more important, a severe recession that brought down interest rates dramatically, would that be a net big benefit enough -- >> right. >> to help them out for, you

know, this, you know -- >> the world's changed, right? the world of work at home has changed. >> yes. right. but at least they'd be able to get some -- >> relief. >> yeah. coming up, netflix and thrill. the streaming giant's red carpet rally lasting seven straight days. can anyone catch this runaway winner in the streaming wars? we'll debate that next. or a...people person. but he is an "i can solve this in 4 different ways" person. and that person... is impossible to replace. you need clem. clem needs benefits. work with principal so we can help you help clem with a retirement and benefits plan that's right for him. let our expertise round out yours.

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welcome back to "fast money." netflix jumping another 1.5% today. the streaming giant now up seven days in a row, and while netflix keeps winning, much of the media space is losing. our parent company comcast is now down 12 days in a row. karen -- >> yeah. bad 12 days of christmas for comcast. >> terrible. >> i mean, they are within 1%, less than 1% from their all-time high during the pandemic, when things were as good as they could possibly be, so, i had to sell a little bit, sold some 750 calls against the stock. that's not going to protect me that much, to be honest, but i feel like, oh, my god, that has been quite a run. >> the analyst community is looking for reasons to upgrade the multiple. it's a free cash flow multiple, because there's a lot of free cash flow. i'm looking at a report from

wolf, they have a 38 times you which equals a 900 target on the stock. the bottom line is, it's hard to argue with, they have a -- you know, the size of their distribution network and the sophistication of it, their ability to seek out content -- >> 38 times cash flow is a rich number. >> i'm just telling you what the analyst community now feels comfortable doing. >> as you see all the other streamers just go through so much pain trying to grow their base, you see netflix and it really underscores the success they've had when it comes to finding that content, particularly international, creating sporting events. >> right. i mean, they have to come up with new sectors, and they're doing that with the live events and sporting events. they trooiring to create urgency around it. i thought that disney was going to sell off, it did, but i also thought netflix would. it seems like a winner take all. coming up, crude climbing back above 80 bucks a barrel. so, why is the sector still near 'le bottom of the barrel? wel break it down, when "fast money" returns.ork be

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welcome back to "fast money." crude oil topping 80 bucks a barrel, locking in its sixth gain in the last seven sessions, but there's just one problem. energy stocks are not coming along for the ride.

the xle energy etf and the oih oil services etf down, even as cr crude continues to rally. so, tim, what gives? >> well, if you think about the run that energy has had from kind of those covid lows, you can make an argument it's just taking a breather here. i do think there's an index crowding owl ing out element. and so, there's nothing about the fundamentals of the sector -- i think the oil price stability is a positive. and this is all in the face of a more expensive dollar. the price action, not good. the fundamentals from earnings season and the m&a activity says i want to own them. >> yeah, the m sp&a activity, there's been a lot of that going on. that's the contraargument in the first term. >> when you get to peak driving season and you don't see oil really rally, i think we're in for a lot more headwind.

i'm negative on energy. >> you have. we have seen gas prices come down a lot, in theory. i thought in the retail sales numbers that would have helped consumers in spending, particularly for restaurants and other areas. >> i feel like if you're a good -- if you are good at what you'll do, they'll go. whether it's decker or on or hoka or -- up next, final trades. le te. pickle! yeah, aw! whoo! ♪♪ these guys are intense. we got nothing to worry about. with e*trade from morgan stanley, we're ready for whatever gets served up. dude, you gotta work on your trash talk. i'd rather work on saving for retirement. or college, since you like to get schooled. that's a pretty good burn, right? got him. good game. thanks for coming to our clinic, first one's free. [ growl ] ready for the road trip. thanks for coming to our clinic, everyone comfortable. yep, there's plenty of space. i've even got an extra seat.

wait! no, no, no, no, no. [ gasps ] [ indistinct chatter ] [ sigh ] let's just wait them out. the volkswagen atlas with three rows of seating for seven. everyone wants a ride. [ snoring ] ok, get in. [ speaking minionese ] yippee! and see "despicable me 4" in theaters july 3rd. rated pg.

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with every swing and block, your game plan never changed. ♪♪ some still call it luck. let them. because you know what it's always been. inevitable. ♪♪ ♪♪ time for the final trade. around the horn we go. tim? >> yeah, i think this amd weakness is weakness you're buying. there's zero in terms of the story. it's where you want to be. >> karen? >> yeah, i liked a lot of what

citigroup had to say. letter c, again. >> bonawyn? >> you're going to see concentration in the top four names. amazon. >> steve? >> last week, all the cruises got hit, they sold off. better entry level, viking holdings. >> all right, thanks for watching "fast money." adon" with hey, i'm kramer. welcome to mad money. people want to make friends. i'm just trying to make a little bit of money. my job is to teach you. one 807 43 june cramer.