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tv   Fast Money  CNBC  January 31, 2012 5:00pm-6:00pm EST

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i'm melissa lee. here are tonight's top three trades. amazon plunging after-hours. a reason to be cautious on the american consumer. plus ralph nader. now he's turning his focus on cisco systems and what they should do with their cash. and can twitter help you be a better trader? we've got a guest that tracks social media sentiment to help make trading decisions. find out what he's watching rite now. live from the nasdaq market site. this is "fast money." the results of amazon sending shares sharply lower in the after-hours. it's also the guidance that is trading below forecasts in terms of revenue also could post an operating loss for the current quarter. >> amazon is a phenomenal company. i love the product. it's the valuation. it almost doesn't matter what they put out there. the valuation to me is so
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stretched they can't possibly grow into it in time sort of to have this work out. so i think that -- you know, down 15 or 20 bucks, i still wouldn't touch it. the valuation is still crazy even though i think they do so many things right. but they have to sort of ignore where their stock is trading. >> this is the tumble in the after-hours session. october was the all-time high in the stock. since then it was down 21%. >> in october that's when the model changed. i agree with you. amazon is not a name i have wanted to own in the last couple months nor is it a name i want to owen this evening. i think the problem in samson, partly look at this and say they're having a slowdown in the sales growth in particularly in europe. really this is about cost. this is about the changing model for their margins. they're spending so much money. looks like the spending trend is only going to increase
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throughout 2012. they have the cloud initiative, that's favorable. but the spending component of it, that leads me not to want to own the stock. even as karen said in the pullback. >> and they have one of the classic retail problems is they're going to sell things at a loss and make it up on volume. old style problem. and investors have been very forgiving about their constant reinvestment. but the profitability has always been kind of up and down arrangement regardless of what the stock does. >> interestingly enough, their operating margin came in at 1.5% and was looking for basically a half a percent. operating margins were surprisingly -- i know it's crazy we're talking about this. it's pretty good right? so how do you trade the stock? i think you have two points of reference. the first is around 170.25 which was the low on about 12 million shars. the stock bounced nicely from there. the other is on the 52 week trade in march. that's 160 and change.
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i'm sort of in the same camp. we talked about amazon for a long time. they have to do everything to continue the stock going higher. but i do think you'll have an opportunity to trade this. >> mike khouw, this week they were trading at 7% up or down move for amazon. did you notice any positioning going into earnings? >> it's interesting. we actually talked about this one last week. and obviously we were positioning for a down move and we obviously got it. i in some ways are surprised because the stock has managed to perforll even on results i thought were marginal. even at a 10% discount, let's say the stock does open up down 20 bucks. still in the high 50s towards forward earnings. about 90 times trailing 12 month earnings. these are high multiples. i think you need to see it come in a whole lot more. despite the fact i think the company on a gross basis is going to grow over the years.
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>> we got breaking news. we want to go back for news on facebook. kayla? >> cnbc has learned facebook is preparing for an ipo of $5 billion. the size of the deal could grow. many issuers use that first figure as a place holder. also morgan stanley has earned lead underwriter on the deal. will share the remaining underwriting possibilities. the paperwork is expected friday morning. but it is unclear how early. a spokesperson for facebook was not immediately available for comment. >> thanks for that update. $5 billion. you're making a good point before when we got the first whiff it could be $5 billion as opposed to the 10. but they could levitate up towards ten. >> absolutely. when they see what interest is out there and they raise the range and the size, we could well look at ten before they get going. which that valuation is how you get the -- i don't know, 80 to
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100. we'll see. >> kayla you're still there. it sounds like this is another case where they're trying to guarantee a pop at the open. one that will trade and continue to trade above the offering price. >> and i think a lot of people will point to this number and say it's a disappointment on many levels because a lot of people were expecting that number. but like karen said, that number will come up. it will be interesting when we get that to look at the actual percentage of shares that will be offered. remember groupon only offered about 5% of its shares which manufactured the giant pop on day one. zinga offered 15% of its shares. flowing into that stock that diluted it a bit. it will be interesting to see if that number is 5 billion. what percentage of outstanding shares that is expected to actually comprise. that will help steer valuation here. >> kayla, do you think the news that we're hearing this evening is confirmation of the suggestions that have been made today that zuckerberg is really controlling all of this right now. it's not morgan stanley.
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it's not the underwriters that are dictating the terms. it's really, he's pressing all the buttons. >> well, i don't think it's zuckerbe zuckerberg. i think he would stay private he had the ability to. according to my searches has been steering all of the discussions here. he's basically, you know, some bankers have used the term bankers are viewed as the necessary evil to be brought in and help them do this deal and allocate the shares in the appropriate manner. it seems up until this point it has been cfo and at this point zuckerberg will come into the frame and do everything they need to do. up until now it's really been a more financial issue. >> no word on where it's going to list. >> no word. and you won't see that in the filing tomorrow either. that is another tactic where the you're trying to get the lowest fee possible, you have to
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imagine both nasdaq and the nyse are both fighting over each other to get that listing of facebook and giving them the lowest listing price possible. it would behoove them to steer the price lower. >> thanks again for that. again, facebook $5 billion. morgan stanley the lead underwriter on that one. it does get filed tomorrow. >> it's interesting when you look at the deliver offerings as they did in the old ipo days. it's not the globe.com which was 600% on the first day. >> forgot about that one. >> which you want to short just because it came out richly and then threw up in everybody's face. it's hard near the valuation whether how much pop there's going to be in the stock. there's going to be a lot of excitement whether or not it can support the valuation is another question. $50 billion in december of 2010. >> karen, are you going to look at the perspectives? >> i'll look.
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the valuation isn't how big is the cap? it's what kind of multiples are we looking at. it's a lot of money, but i don't know if it's expensive. >> isn't it 100 times earnings? >> i don't know. but can i make one last point on amazon? >> yeah. >> i wanted to point out walmart ten years ago traded within a buck of where it is now. they were the juggernaut as they still are in the retail space. now they earned $4.25 give or take. they had to grow into it over a decade. that's where i think amazon is right now. they can do everything right. they can triple their earnings and still not have the stock go anywhere because the valuation is stretched. >> we had that argument with an analyst maybe three or four months ago. the analyst said amazon right now is approaching or is at the point where walmart was at that time in terms of valuation and growing into it. let's bring in carrie rice for more on amazon's earnings.
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i don't know how much you heard. but do you think we're at a point where amazon needs to grow into that valuation and who knows how long that could take? >> yeah. i think that point is very well taken. but, you know, i think it will grow over time into that. though it will take some time. but i would argue that the stock does -- that's not really where the stock trades. it's not driven by its valuation or the investors that seem to really be involved in the name. it's more about the opportunities and where they go over the long-term. but not necessarily valuation. >> how do you read the quarter? was it just a disappointment across the board in your view? >> well, you know, certainly on the top line i think it was disappointing. in the u.s. we thought it was a little bit weaker than we expected. and in the media segment weaker than expected. but it's not all negative as pointed out earlier. margins a little bit better than we were expecting. i think the street was looking
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for about half a percent operating margin came in at 1.5%. little bit better. still down year over year. and we don't expect it to get back to those levels for some time. although again i think the stock trades more on expectations than valuation. and so as analysts, i think we'll bring their estimates down. gives the company opportunity to beat those in the future and that would likely bring the stock back up. >> at a certain point, it stops trading on expectations and it starts trading on reality. the reality is it's a company whose margins remained 1% to 2%. it sells a lot of things. almost by definition doesn't that valuation, doesn't that multiple need just come down? >> yeah. i believe it does. and i think your point is well taken in the point of where are investors getting tired of this
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high valuation and being able to invest money when the spending on infrastructure continues to be very heavy and maybe even topline growth is not going to be what it used to be. people are going to look at this with more scrutiny and maybe won't see the wide upswings just because of a revenue beat as they look through valuation on this name. so i do think that that is or are factors that will become more and more important to investors as amazon continues to mature. and over time, you know, i do think it will remain the dominant domina dominant ecommerce player. >> would you say buy the stock or just wait? >> well, as a trade i think you could -- i think you still wait. because i think there's three things or four things that i'm concerned about. one, we still have the sales tax
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issue out there which is likely in no one's models. that will bring down estimates most likely. you've got the continues infrastructure investment spending, slower growth. again on valuation it remains expensive with estimates coming down. if you want a longer term hold, i think it's certainly a place to be because it will remain the dominant ecommerce player for arguably the next decade. >> thanks for your time. kerry rice over at needham. meantime let's move on to our next trade. ralph nader. he's been a public advocate for decades. now he's the role of shareholder advocate. he personally owns 18,000 shares of the stock. he says in his block, the least cisco's officers should do for their shareholders many of whom traded cisco for over a decade
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and relid on their management to reverse the tiny rate of return that they received for their loyalty. author of "getting steamed to overcome corporatism." it's always a pleasure to see you. thanks for joining us. >> thank you. >> you're urging cisco to play out dividend as well as a special dividend. have you talked to management about this? >> we've talked to a high official there. they said they acknowledge. they're sitting on $45 billion of the shareholders' money. and they have a very paltry dividend. that's been recently declared. and they're considering what to do with the money. okay? so they say should we increase your acquisition? should we accumulate more of thissi this idle cash? none makes sense but to give it out in dividends. the company has gone down from a high of $82 in march 2000 to
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around $19 now. it's five times bigger, more profitable. year after year. and the shareholders have been left out to try. an owner of 15 hundred shares wrote me recently and said the shareholders can use the money and it would be spent immediately in a manner that would help our economy in the united states. so i've launched what i call the penny brigade initiative. look at the arithmetic here. if owners of just 10 million shares outstanding threw a penny per share into a fund, it would hire one full-time watch dog for the millions of shareholders to make sure that management responds to them first. not just to management and directors. >> do you want to be that full-time watch dog advocate? >> i'd want to select him. i think this is a pilot project.
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because you've got google. you've got emc. you've got intel. you've got microsoft. you've got apple sitting on over $80 billion. google over $40 billion. it's the shareholders' money. and they should increase or start a dividend to be a great stimulus to the economy. i've been trying to get president obama to make a statement on this because it would be worth more in terms of consumer demand than the creation of jobs than just piling it up and a tiny fraction of 1% interest in the cash hoards of these giant profitable corporations. so we want to hear from people from shareholders from all these companies. just e-mail me at shareholders@nader.org. shareholders@nader.org. in a prior interview on cnbc, we launched this idea. i think it's a very powerful one. on behalf of over 70 million very patient investors in this
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country who own their companies but don't control them. >> mr. nader, it's karen fi finerman. there is a mechanism. you can submit a proposal to the company. it's nonbinding so they don't have to do it. but to the shareholders at the next annual meeting to vote on a capital allocation plan. that would be an inexpensive way. it's a strong message to send to management if you have a large proportion of shareholders that support that kind of proposal. would you do that? and do you own app snl. >> no, i don't own apple. it's a good idea. at the last shareholder meeting a few weeks ago, some shareholders raise this dividend expansion issue. they didn't get anywhere. so there probably is a need for a shareholders resolution as you indicate. it would be nonbinding a because the business judgment rule. if we can get van guard and these mutual funds behind it, we could return more of the
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shareholders' money to the shareholders and start a precedent for all these other giant corporations who in their totality are sitting on $2 trillion of idle cash while the economy desperately needs more money for consumer demand to create more jobs. >> right. >> ron here. you've come a long way to nader the raider. don't you need more leverage with management to get them to move off the dime the same way carl icon or someone else might amass a larger position in the company to influence the decision of management? >> well, that's a more dramatic intrusion by shareholders. and an appropriate one. carl icon tries to hold management's feet to the fire to get policies or shedding subsidiaries or improving cost controls. this is basically very simple. this is the shareholders' money. and most of these companies are getting zero. and some of them are getting a trivial amount. they deserve more.
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they deserve to have their loyalty repaid. they need the money. the economy needs the money. we want to hear from more shareholders as these giant corporations give no dividends or paltry dividends. e-mail us at shareholders@nader.org. we're going to really start something big here. no one in american history has ever managed to find a way to organize millions of american investor shareholders. we're going to try. >> if there is somebody to do it, mr. nader, it will likely be you. we hope that you come back on our show and update us on your efforts. >> thank you very much. pleasure. >> all right. >> can you imagine flash mobs for this? >> i imagine there are a lot of people e-mailing him at this moment. there are a lot of people who are angry even if you're not a shareholder to think of corporations sitting on piles of cash that could be distributed to be spent in the economy. >> when was loyalty in the
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business world ever something to be rewarded for? shareholder loyalty. in other words you owned the stock for a long time, so you're entitled to something? i would completely disagree? >> why? >> because you don't owe them anything frankly. why being a shareholder for ten, 15 years or ten minutes, why -- >> because i think that shows a support for the management, long-term is over time. you're willing to stick with them, see their plans out. you give enough time. it's all right, we've given enough time. you should give some money back to the shareholders. particularly when the stock doesn't get to a fair valuation because the cash weighs on it. apple is the most perfect example. >> the whole point is return to shareholders. but i think it needs tor more effective probably at the end of the day bringing pressure on management. >> mike khouw are you busy writing an e-mail to nader rooigt now? >> i think one of the important
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parts of this dialogue that hasn't been mentioned yet is pat riatinos of cash -- may be in international. and you need to start dealing with the taxes for repatuation of tax until you can say let's increase dividends. it's an issue for all. >> mr. nader actually addresses that. says it's unfair to hold shareholders hostage to what the administration might or might not do. and makes a point cisco throws out $3 billion in cash. so it can pay some sort of dividend. >> apple has 27 billion of u.s. cash. >> how can anybody expect management to encourage the administration and others to try to come up with reasonable tax policy before you start -- >> i don't think one is the other is what i'm saying. one wouldn't preclude the other. >> in cisco's defense, cisco likes to buy back their shares.
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they bought back a ton. 50 billion in excess, i would imagine. maybe we don't like buying back shares anymore. but that's what companies like to do. in terms of cisco's stock, again, cisco remains a name over the last two months that's turned the story around and can be owned once again. >> all right. got to take a break. next on "fast," a powerful new trading tool. how to make money by trading on tweets. more "fast money" coming up next.
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welcome back to "fast money." amazon.com trading sharply lower in the after-hours session after posting its quarter results. let's head to jon fortt. he's been on the call for the latest. >> a few things said on the call. one interesting thing. that disappointing guidance number particularly on operating income. impacted by what 50 basis points worth of negative for impact.
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analysts also asking about kindle fire sales. trying to get more detail out of them. they won't say anything other than what's in the release. that it nearly tripled. they are emphasizing a jufs justification for the investment. sales were up from 32% of units to 36% of units. they're saying the reason they want them to fulfill is they've invested so much there. >> thank you very much. do you have a question? >> i'm wondering why they have 4x exposure? it seems odd to me. >> i think it has to do with the international sales. >> i get that part. but why don't they just domicile here and let people buy in the united states in dollars. why do anything in another currency? >> just earned yourself a seat on the boards of directors. >> jon, keep us updated. we appreciate it. jon fortt and headquarters on the amazon conference call.
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next here, mastercard is joining visa to allow debit cards that use chips instead of strips. so how can you play it? karen's got the fine print on this. it's going to be a push to 2015. >> that's the latest date. there's a stick if you don't do it before 20 is a. there's a karat if you do it before. you're taking on all other things. i think the hardware and the software to help in this migration is interesting. this is technology also used in europe. we've been playing with a name called gemalto. and today verifone. that's a way to play it as well. it could be an atm company. this is going to happen. i don't know if one needs to jump in today, but i would buy -- i'd like verifone if it
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pulls back a little. >> europe is not a concern for you? it's the fastest growing region for verifone. >> maybe they solved this greece thing. i don't know. maybe. i think longer term this is where we're going. we're behind in the u.s. >> i agree with you. i like ncr. that's a good trade. and i also think when you look at mastercard and sooe is a, you want to own both of them. i've owned visa in the past. shifted to mastercard. that's the trade. reallocated out and to mastercard. now they're playing catch-up. coming up next on "fast money," we just closed out the best january since 1997. but does that translate into gains on the year for stocks? we'll answer that straight ahead.
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welcome back to "fast money." let's take a check on shares abroad. also out with earnings. up 2% in the after-hours session. they're lifting their dividend by 11%. >> lifting the dividend. based on the iphone sales we got from apple last week. i think the concern was looking forward. the guidance for the next quarter. historically the seasonality is this is where it rises. but the guidance here looks solid. it looks okay. i think this may motivate some of the analysts on the street to revise their earnings a little bit higher here. >> in line the stocks had trouble this 35.5 level. basically at the levels we saw last week. it's had a nice bounce to 27. so i'd be cautious in piling in
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broadcom. if it goes to 40 you missed it. otherwise wait and see. >> is this good news for qualcomm which reports tomorrow? >> you would think so. it goes back to the guidance. there was real concern the guidance would offset the tail wind it was getting. i'm out of the stock. i got out of the stock. i'm going to miss this one on the open tomorrow. i don't disagree that maybe you take a second look at this and don't rush in. >> let's move to our next trade now. stocks kicking off 2012 with a bang. will the rally continue? and which part of the market should you expect to outperform. let's bring in president of bollinger.com. made so much of this. and as i understand it at the close the s&p actually did attain that golden cross. do you read too much into it though? >> no. this is the perfect example of the tool and task being mismatched. the golden cross is a great tool
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in a big roaring boom market like the boom market from 1982 to 1998 where it tells you when you're supposed to be in the market and when the risk is somewhat higher and such like that. in a sideways market we're in, the golden cross will get you in toward the upper end of the range. tend to get you out toward the bottom trend. you see our entry price right now as of the close here is higher than the exit price immediately preceding. that's exactly what you should expect from a big, long, very slow technical tool like that. it's just the perfect case of mismatching the tool and the task. >> so if we're going to debunk all of these sort of stock market adages and beliefs, january barometer. what does this mean for the stocks if anything? >> there's two versions of the january barometer.
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and as goes the month of january. so goes the year. that's the basic idea. the first five days has a slightly better track record than the month as a whole. but neither of them are markedly better than a coin toss. i think they're important psychologically though. especially the first month. when you get a big strong first month of the year like this, people pay attention. they tend to tune in. you're in a situation where you have a huge number of people who are under invested here. you see the market moving higher. you see the positive signs. they start hearing things like positive golden cross. good january barometer. they feel they have to get in, they have to get the stocks they don't own. so i think the psychology is more important here than the fact of the indicator. >> hey, john. it's ron. you've had obviously a close eye on seasonality generally. we're still in the sweet spot. are you still going to play that seasonal trend where stocks are strong up until april/may? >> sure.
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it's working out perfectly this year. one of the things we do with seasonality is say when it works, fine. we'll follow it. when it doesn't work, get out of the way fast. the first test is to see is the market actually going according to seasonal pattern. so far it's not only going according to the seasonal pattern, it's going exactly according to the seasonal pattern. i don't think we're going the see giant gains into the middle of the year, but i think it's a good time to join equities. >> thanks for joining us. john bollinger. top si is using tweets and other sites to signal upcoming market in stock trends and points the drop in netflix as proof it actually works. rashad, it's great to have you with us. i have to say.
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at first glance, i didn't believe it. use the example that proves this to be true. >> well, i think you have to look at twitter sentiment as a giant opinion poll you can take for products and companies all the time. being able to know what people want and how they -- what their demand is for products and companies all the time at any moment is valuable. if you had used sentiment numbers for the iphone 4s launch, you'd have made a 20% return in two weeks. most of the analysts when the iphone 4s were launched thought consumers wouldn't really like had it. but they loved it. that's what iphone sales numbers showed ten days later. so the stock price went down to 350 on the day of the announcement. >> so you're pointing to apple as an example. we use netflix as an example as well. where you can gauge consumer sentiment.
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and the reaction to actual products or services in order to determine whether or not those products or services will actually sell well and impact the stock price. >> i think stocks that relate to consumers are probably the best way to apply this. but it's a general way to get consumer sentiment for anything. for instance, with jcpenney we did sentiment and you see a sharp dip when they announced they were having a lot of layoffs. and then you see the consumer sentiment went up a lot when jcpenney overhauled their website. and some of the positive tweets were like jcpenney nailed the american look. so you can get feedback that way as well. >> can you talk about in terms of sample size. is it a handful of stocks? are you talking about the entire stock universe? we could cherry pick apple and a couple of these, i'm sure. but how broadly have you looked at this data? >> well, we've actually -- so the paper that we published was
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on netflix over a period of seven months. we actually did a statistical regression to look at lots of terms that were related to the netflix stock. so it's not just the company name. lots of other towns. and related that to the stock price. we could do this for lots of others. we've tried it for lots of other stocks. now i have to caution we are not in the business of trading stocks. if we came up with a magic formula, then we would be a hedge fund. we wouldn't be a technology company. so our business is just to show that there is signal out there. we think that's obvious. we're just able to analyze and essentially conduct mass opinion polls for hundreds of millions of tweets every day and this can be applied to lots and lots of stocks. we think it's probably more applicable to consumer stocks. but it could be to commodities that are affected by weather and
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things. >> i've got to ask you one last quick question. who is buying your research? are any traders or hedge funds using your product right now? >> we're talking to a lot of funds. we don't have a product that we're selling yet. we will do so later this year. at this point we are talking to a lot of funds that are experimenting with our data. >> great to speak to you. nice to meet you. >> whatever happened to good old fashioned boots on the ground research? back in the old days you drive up to bell parkway and see the oil tankers. if they were low, that meant there was a lot of oil out there, you sold. if they were high, you bought. >> another tool in addition to boots on the ground. coming up next on "fast," investors flock in the facebook sympathy plays. but there's one trade you may not have thought of. we'll reveal it next. in america, we believe in a future that is better than today. since 1894, ameriprise financial has been working hard for their clients' futures. never taking a bailout.
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welcome back to "fast money." we're live at the nasdaq market site. facebook's ipo filing expected tomorrow. street insider.com has made a list of derivative trades. but we have the top pick. not on any list we've seen so far. so dr. j, what is it?
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>> it would be netflix. and no positioning here. liquidated all of our netflix last week. except the video piracy act. this is sort of like sopa and pipa and got shot down. this is why you can't stream netflix on facebook in the united states. you can do it and they do do it in 47 other countries. so my play, melissa, would be netflix. it's already passed the house. hr-2471 was the bill that passed the house. if the senate gets on board with the house version of this, it would be gang busters for netflix. >> at what point would you look at getting into the fashion
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whether it be equity itself. and are you listening to the amazon calle if they're spinning off their streaming business. >> i have not heard that. i am monitoring the amazon call. but i will say that this particular movement could be one of those great times to be a member of congress. because the people that are paying for that information which you and i know, melissa, is not inside information. apparently congress is immune to that and can sell that information. that is pretty valuable if we knew when they are going to move on this particular video piracy protection act. that would be like i say a market mover for both facebook if they do it. but i can't tell you when. >> dr. j, always good to hear from you. facebook could ipo as early as tomorrow. demand is expected to be high. so let's bring in manager at the
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global media trust to get his opinion on facebook so far. i know that information on the issue is limited at this point, but is this the sort of issue that you need to get a part of at the ipo? offered to you? >> i think it's going to be a fantastic feeding frenzy, melissa. every growth investor on the planet would be involved. tremendous public demand. it's going to go up in the first two days of trading. then it's going to be a lot like the old road runner movies where the coyote is over the cliff and just learns about it after he's over there. because we're looking at a multiple of cash flow that's going to be somewhere around, my guess is by the time we're finished on the aftermarket tradings, it's 70 times or 130 times earnings. the list of stocks that performed well at that level is between slim and none. so the odds are stacked against it. because this will be a big company and to move the needle it needs big things.
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i think the part if you're going to get excited about the stock is the apps part where facebook collects rent. i think it's going to be a lot like the ipad where people -- the application community, if you will, are at work trying to figure out what the next best thing is on facebook. and some of these are clearly going to do it. and that's going to provide some jet fuel to the facebook valuation. really it's so hard to talk about what's going on here. you don't see the margin level. you don't see the revenue growth. you don't see the conversion of revenue to income. and people can get really carried away. at the end of the day, i'm a retail analyst. i started doing retailing many moons ago. you look at amazon and amazon has numbers that if it were a retailer and i'm talking about operating margin structure.
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i think it was under 4% in the quarter. which is just a disaster if you're a retailer. it would sell at about a six muput pl of cash flow. and it's not even a company where cash flow is down over the last four years. so you have this aura around tech that can create and persist with these mythical valuations. i'm sure facebook is going to join in the mythical crowd. >> right. >> but it's a very tough game to play. >> sure is. larry, we appreciate your analysis. coming up next on "fast" we've got an options trade on one of them next. to think about your money... ♪ that right now, you want to know where you are, and where you'd like to be. we know you'd like to see the same information your advisor does so you can get a deeper understanding fert. 3w4r57 and what we heard helped us create pnc wealth insight,
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options action on cf. >> goldman up. credit squeeze down. if you own the stock up 40% now from the mid-december lows. one way to stay in the stocks, don't collect the dividend is put on a put spread call. i was looking a tht the may 150, 170. spend about $14 for those. sell the 150s against it. and then sell the 200 calls for
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$7.35. no net debit to put this on. protection from 170 to 150. >> all right. thanks for that trade. catch more "options action" every friday at 5:00. follow the show on twitter. next on "fast," the secret lives of traders. stay tuned. this is $100,000.
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we asked total strangers to watch it for us. thank you so much, i appreciate it, i'll be right back. they didn't take a dime. how much in fees does your bank take to watch your money ? if your bank takes more money than a stranger, you need an ally. ally bank. no nonsense. just people sense.
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welcome back to "fast." professional traders are unadashed risk takers. always looking for the next hot opportunity to trade and own as well. sharon epperson caught up with a few of them on high stakes for traders who were following the game. what'd you find? >> the secret careers here we want to talk about. some of the folks on this desk knows how this happens. traders reinventing themselves as the trading landscape has changed dramatically over the last few years. many who worked on theor for decades have seen an erosion in their business. for some like this floor broker it's a chance to enter a new world and a new venue. >> i'm an energy guy. not only energy trading but energy in my mind. my mind doesn't stop. >> energy is certainly evident
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on the trading floor. >> it's 3045. >> when trading ends here, he's still going. off to his newest venture, a start-up tech company. >> tell me about your inspiration. >> social and mobile. a lot of time and money is going into this space right now. >> that space now has a new mobile app calling venuing. it allows fans to interact with each other at sporting events and other venues. >> i've been a sports guy my whole life. i'm enthusiastic. i want to talk to other people around and get more information. i thought that there's maybe a better way to get fans more engaged. >> direct access and a new way to your fans. every moment from every station you go to, you can talk to your fans. your fans get new access to the kinds of brands and sponsors your organization already works with. >> sometimes i want to see what happens on the other side. was that a good call or not? i'm able to get that.
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>> product development is complete. now talking to potential buyers just as he does every day in the trading pits. >> how difficult is it to be on the floor as a floor broker, come here and build a business? >> i love challenges. i love being creative. >> now he's riding the next wave in social media in a new company creating a new venue of his own. now, tomorrow on "fast money," we'll bring you another trader who found a golden opportunity in his own real estate venture. and on friday we're going to look at how much high frequency trading and sports betting can be complimentary businesses especially ahead of the big game this weekend. >> thanks so much. got your first move tomorrow when we come back. stay tuned. i've been riding since i was 17.
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the other office devices? they don't get me. they're all like, "hey, brother, doesn't it bother you that no one notices you?" and i'm like, "doesn't it bother you you're not reliable?" and they say, "shut up!" and i'm like, "you shut up." in business, it's all about reliability. 'cause these guys aren't just hitting "print." they're hitting "dream." so that's what i do. i print dreams, baby. [whispering] big dreams. they sound awesome tonight. and when i do find it, i share it with the world. you landed the u.s. tour ? done. this is fantastic ! music is my life and i want to make the most of it thout missing a beat. fly without putting your life on pause. be yourself nonstop. american airlines.
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final trade time. >> like the action in financials lately. it's time maybe they'll look at citi group. and buy that. >> trn. >> don't look at amazon. >> the anti-final trade. joe. >> keep buying those ung

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