>> here >> here is where we stand. take a look at our heat map. it is a a split decision. >> but still finding opportunity amid the delays. >> it trades at a multiple below the average and i think that's extraordinary. >> the market and economy is on hold does not mean that companies have stopped innovating. >> we have new varieties out.

>> this is "fast money." >> falling forecast. cragging stocks lower today. fourth losing day in about a month or so. >> certainly a lot of ripple effects. things are bad for who? >> it was bad for cummins. here is a company that has not missed in a long long time. i like that management is a serial underpromiser and over-deliverer. brazil, india, china. weakness as well. revenue guidance. that revenue guidance, that is a

big move. there was a tiny bit of good news with the i think there is value here. but, you know, i am long some. this is bad. >> is this weakness in the trucking industry as well as the power generation industry. therefore should we paint the broad brush and say everybody in this space is going to have problems? >> they are the market leader. when you talk about how significant the cut was, you have to look at the 10% revenue cut for the rest of the year. you are losing a whole year of revenue growth because they said they were be flat. i was able to short when the announcement came out. i think that continues to go

lower. if you look at the whole sector, i think there are warning flags all over. so currency is going to be a major issue for every multinational company. >> when i think of cummins, i think of diesel engines. this is about four and a half times.

>> we had the warning from neekee. >> caterpillar had already got it done. talked about weakness a couple of months ago. this is almost somewhat of a ka pitchlative move. today's price action is a little shocking. it may be the period we are getting into. >> i actually this there is a bigger shoe here and sit complacency. the markets are up mid single digits today despite massive revisions to economic growth

around the world. i think there is more to come. cummins is cheap if you can believe the numbers where they are. i'mthe camp that believes that numbers will still be coming down for the rest of the year. >> you look at the entire broad industrial space. it was all of these guys out there. and at this point is there anybody willing to step in and say you know what? maybe it has been discounted. caterpillar has been discounted. >> i would not go near cat. be careful. they can kwet t get cheaper. they to me are the most effected. 31% of their business is u.s.

decent machine equipment numbers out again. at a valuation in line. stuffed a stick. i'm saying relative value. >> in the options market, there was a trade in caterpillar. for like eight and a half dollars and they took that premium and they bought the puts. making a further bet that this thing has further downsized. >> the news also traging down best buy stock. what would this say about the

consumer. >> they were supposed to lose four cents. that's major. >> the difference is that all of those stocks have been hitting on al sill linders. >> we're talking about. >> that business model has been the same thing that is the best buy bear case. so i don't know that it's so much an extrapolation. >> a lot of talk about amazon in the network today.

saying that these guys are foregoing profits right now. let me tell you something. amazon has benefitted a great deal. if they ever get -- like they have the same issues that some of the other competitors do as far as demand for the products, they are already not making money. this will be the last battle fought. >> let's talk apple. after the close, steve came out and initiated on apple. >> given moderate smart phone and tablet penetration as well as potential new products. >> really not too soon to start talking about it. some have come out and tempered

expectations. i agree. i think it is compelling ling strong company. >> bmo said they see a couple of lean quarters ahead. ipads are all great. if you are going take down revenue estimates, that could really spell a bigger dry spell. >> last quarter it came from china. they are launching with many more carriers in china. if we ever get confirmation that apple, the ultimate consumer electronics retailer in the world is seeing a dwe sell ration? this thing does have downside.

>> china was not registering on their radar. only three or four years ago. they have gone from seven, eight%. i think china is meaningful enough. i have talked about how china mobile is slowly adopting the iphone. i to think there is a lot of upside. you have seen a lot of reaction and specific stocks. >> the news in the afterhour session, steve initiating apple at a buy rating. citing a weaker than expected kwand.

will intel fall victim when it reports next tuesday? >> good question. not necessarily that. they are a little farther down the food chain. literally five minutes into asia. i totally expect intel to come in below the midpoint of their guidance. >> there is bearishness build in. >> our price target is 25 bucks and i think the stock is trading at 25 and change hence the neutral rating. those estimates are likely to go

lower. stock looks fairly cheap. >> to me, intel is an interesting story. we have seen microsoft. we have seen fwoogle announce tablets here. the tablet space for intel. how are they positioned here. as we see cannibalization coming from pcs. how does that factor into your neutral rating? >> it does somewhat. kind of a more cyclical frame work. the reason we like semis but not intel is most of the companies, margins and levels are closer than the peak with the notable exception being intel.

and for next year. a combination of a cyclical stock. and in terms of pcs, i think two factors are working against it. number one is tablets. number two is china slowing down. that's the biggest market. intel does not have a great position. it's essentially apple and no one else. there is optimism on getting into the tablet space and hand set space.

>> a & d negative. some smaller stocks. really, we took numbers down on every company we covered a month ago. i would think that the sector as a whole has downside. >> chris, thank you. >> we have seen people are doing a little bit of stock replacement, too. the bomb has gone off. we did see people pressing bearish bets here as well. short dated calls. it would be a better way to keep a bullish bet on. >> we are trading the children

of the corn. find out how you should be playing the stocks most impacted by rising food costs. that's an amazing graphic. we continue to go running with the bulls. one analyst who is going against the grain. more than 70% for the past year. [ male announcer ] summer is here.

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>> so far this year, our next guest says that he is increasing his rating and price target on the company. how should we understand the hedges? >> for a long time this stock under performed. there were very low hedged.

only 25% for the second half of the year. each penny that we bring down is about a penny and a quarter. so i think investors looked at the other airlines first and said here is where it is. so we said enough is enough. >> in terms of fuel cost and capacity coming out of the system, is there a tipping point where that covers lower demand? >> we do anticipate there could be softness in the second half.

you look at what the chip guys are saying. this is really the bigger issue. it's not you and me deciding not to go florida to visit relatives. so a small drop often years ago would have been a much bigger difference than a small drop off today. >> a lot of people talk positively about the charts. surprising for a relatively new player in the space. >> personally i'm a big fan but

professionally we don't have an opinion on spirit. there is always a new low cost carrier out there with growth opportunity in this cycle. >> thanks so much for joining us. corn took another break as traders await the monthly crop report. >> it is the biggest producer in the world. i would like at kns in europe. up to 50% of this crop. ukraine, third largest producer. also going to be done 50% on the

crop. environmental weakness for me as well. increased 7 times in the year-over-year-year-old that they had. this, to me, is always a bit of a cyclical trade this is a trade that has a demographic. at least we know this was the report to lead into this. rr these are really trading stocks, though. we are pretty much out of the whole space. we're out of cf and out of potash. they could swing so wildly. >> we should also talk about the ripple effect.

downgrading tyson foods today and that is the next children of the corn trade if you will. >> tyson is there and there is chicken capacity which they seem to have a problem keeping the chickens, have the chickens keep it out of the hen house. >> it was metaphoric and poor. pork, we know that there is an issue.

margins are relatively thin and they have had issues in the past. >> coming up next, want to know what is going on in the world of hedge funds? no one better to ask than our next guest. oversees more than $40 billion and he is up. we come back. still to come, one of our own on the desk that has brought along the trade of the day to make you well connected. stay tuned. we will reveal what lies behind that curtain. more fast up next. people with a machine.

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the lexus ct hybrid. this is the pursuit of perfection. you have to dig a little. fidelity's etf market tracker shows you the big picture on how different asset classes are performing, and it lets you go in for a closer look at areas within a class or sector that may be bucking a larger trend. i'm stephen hett of fidelity investments. the etf market tracker is one more innovative reason serious investors are choosing fidelity. get 200 free trades today and explore your next investing idea. c'mon, michael! get in the game! [ male announcer ] don't have the hops for hoops with your buddies? lost your appetite for romance? and your mood is on its way down. you might not just be getting older. you might have a treatable condition called low testosterone or low t. millions of men, forty-five or older, may have low t. so talk to your doctor about low t. hey, michael!

[ male announcer ] and step out of the shadows. hi! how are you? [ male announcer ] learn more at isitlowt.com. [ laughs ] hey! >> i think it's the best big growth company we have. it's the dominating brand in the area that it is. and it trades at a multiple below the average in the s&p 500. i think that's extraordinary. >> cutting their revenue guidance for the quarter. at least for the quarter if not for the second half of the year.

>> we have seen pc supply chain. we have seen other tech companies that sell into the space. they have disappointed. so me, what i found interesting two weeks ahead of the earnings report, the stock started to take off. the fever had broken here and it flat lined. we start the new quarter and it starts this move here. what is interesting to me is that we are likely to see some of the skeptics. if you get the thing selling off like last quarter. >> where would you be a buyer? >> it is a buy here and here. >> let's move on here. 2012 has been a rough year so far for hedge funds.

compare that to the over 8%. what is behind the performance? david overseas $42 billion of alternative and traditional managements. taifd, great to have you with us. >> a small degree on the trending space here. >> it has been a consistent theme here for a couple of years. >> with this all said, where are people going? probably high net worth going for alternatives?

>> are there areas of the world or types of industries that are attracting the most at this point? >> i would say the larger space that are doing larger transactions as well as funds that are setting up to take advantage of the distress in europe. there is a lot of money anticipating a trend that will be banks disposing of assets. >> how active can you be with that kind of size? i know you guys do a lot of work. can you find yourself a step behind the trends as you start to make interesting trend analysis of the market? >> you can and i think that's is something that we have the be

careful about. we are deeply underweight equ y equities and overeight fiked income. we are anticipating where things are going. it will be important for clients to have. you are underweight equities and it has been a great trade relative to fixed income. are we nearing the end of that cycle? >> the relative valuations. >> i want to go the interesting notion of direct lending. we were talking about how corn futures are hitting record after record. how is this done? how do you facilitate this happening? >> there are many funds that have been set up. let's talk about where the trend

comes from. >> the funds are being established now to actually take the trade finance. that is something where you will see very good returns. taking the place of the banks. >> if you are an investor who engages in this, how do you exit that investment? >> the fund itself is making the loans. as those loans burn off the fund will end. >> that's right. that's the whole idea. you have the assets that the

farmer has. >> there is a fund that is launching. buying farmland in brazil so that they think they can. operator: more efficiently. are you seeing more of that? >> there has been a whole trend of people buying farmland for income. leezing of the land. includes a rent associated with the crop. that is definitely a trend that is taking place. >> we appreciate it. >> you don't have to travel all the way to go running with the bulls. a buy rating on one of the most beleaguered stocks in the place. stay tuned. tdd# 1-800-345-2550 the 5-day moving average just crossed above the 20. tdd# 1-800-345-2550 we're hitting new highs. tdd# 1-800-345-2550 the spx is on my radar. tdd# 1-800-345-2550 and i'm on top of it all with charles schwab. tdd# 1-800-345-2550

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welcome back to fast money. let's get some afterhours action. we are watching a decline in shares of gold corps. the reason behind the lower prodex outlook, specifically operational problems, one in ontario and one in mexico. we are seeing across the board. take a look at newmont mining, which is down.

>> i don't know why anybody owns gold minors. just own the commodity. maybe that is an exception. >> that's the thing. pays a 6% dividend yield. it's interesting. i wouldn't be trying to stand in the way of what is a very complicated mining trade right now. you get guys that are very cheap and pay you against the guys. production assets that are not as good. >> walmart continues to work. mike saw some interesting

activity. >> we saw a lot of 1475 calls. as a block, if you took a look at something like this you might think there is a lot of big bullish bets. we didn't see the implied volatility spiking that much. maybe there is not that much downside in the stock either. they are looking at maybe as much as six and a half% upside before they would be called out of their loans. >> all of these stocks in the space, the dollar stores and costcos are trading fairly well. >> '08 was a fantastic year for walmart. it's actually getting a little bit rich for me. we have had it a long time. >> i bet you never thought you would say those words. >> you know, it pivoted on the mexico story. a huge "new york times" article.

>> he said that is possibly overriding. you would buy calls and have some exposure and defined risk. >> target? >> cheaper? >> it just has not gotten the publicity and press and talk that walmart has. >> we have got our own that we are looking at. we are looking at research in motion today. shares up going once again today. it is down, by the way, 50% year to date. our next guest has a buy rating on the stock. he upgraded it just last week.

>> in reading the note it sounds like one of the primary reasons is you think something -- is that the primary reason? >> absolutely. we think there is a good compelling case. mobile rimm has one of the best mobile networks in the world. it is very secure. governments cannot get access to their codes. enterprise value is 1.6 and there are many number of players that could take a run at this without much of a tend. one year ago, two years ago. i think coming out in early 2013 it will be 208. i think there is a way to lock the value.

>> it seems like your case is completely based on acquisition. i have the old one. by somebody you didn't like. >> by blackberry. >> regift it back. if it's based completely on take-out, i get the need for them to sell but who has got the need to buy it? >> that is a fantastic question. we think probably not as much of a burning need. we made a similar call a few years ago when palm was on the ropes. somebody would be successful. >> i think a lot better opportunity to turn this around

than a palm. this has 78 million subscribers. there is enterprises and governments that are deeply embedded with this. look at an droid. there is no unifying service. if google were to buy. >> a secure application inside a rimm. today, if you buy an android an head or iphone, what most companies do is they put that on to a hosted exchange server. we use intermedia. microsoft does not have the

sales force that rimm has. >> when you buy a rimm hand set, you are on the blackberry network, whether you knew it or not. i think the amazing is that they don't have that network. you get that. >> we will leave it there. hudson square research. if you were a company, wouldn't you wait for this? >> is t asset -- this company has either been explicitly or impolice italy for sale. maybe there are no buyers.

>> time for pops and drops you may have missed. >> really key level for the stock. >> what i know about harley davidson is close to nothing. a. >> natural resources down 6%. >> filed for bankruptcy. this thing is trading at multiyear lows. investors are taking it out. >> jcp, a drop? >> credit swiss came out is they cut their estimates and price estimates to just over a buck. that makes it very, very expensive. i'm still short and i'm not covering just yet. >> we got a drop. mike? >> the cummins news really hurts

news like this. they were not interested in buying the company. >> a new beer is infused with two tenths of a gram of the precious metal. it is not worth its exact weight in gold, but it is not cheap. it is only available to special clients. >> there is a newcomer. find out which fund investors

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how math and science kind of makes the world work. in high school, i had a physics teacher by the name of mr. davies. he made physics more than theoretical, he made it real for me. we built a guitar, we did things with electronics and mother boards. that's where the interest in engineering came from. so now, as an engineer, i have a career that speaks to that passion. thank you, mr. davies.

>> coming up next hour, cramer is coming up to look at the facebook status. plus the ceo of globe specialty metals all coming up on mad money. outperforming mutual fund. rr let's ask paul, the etf analyst. great to have you with us. what accounts for the disskrepscy in performance? >> essentially, bond is a different fund than is mutual fund counter part.

>> i think more importantly, the fund is a lot more nimble. so it's been really popular. but that pales in comparison to the $260 billion in the mutual fund. it can move in and out of positions in the bond holdings that it owns. >> in this environment it has more to do with the fact that

the fund can move in and out of its positions easier than the big aircraft carrier that is the mutual fund. i think over the long term, the questions remain whether or not it's avoidance of derivatives gives it more or less tail risk. >> in terms of your recommendation, then. >> it's realitily apples to oranges. it's a different fund chl i think investors who want liquidity have an option. and investors looking to save some money certainly have an option.

in short term periods like this, it may benefit them but there is no guaranteeing that will be the case over the long term. if we have credit events. it's likely that there will be safe from some of the losses that they might incur. >> let's switch gears here and talk about emerging markets. nice healthy inflows in the first half. are you getting indications that this will continue? >> investors are looking at the space. the broad emerging markets. etf was the biggest gainer over the course of the first half of the year.

they are looking at it to get the income. investors are rotating out of some of the old names. like brazil saw one and a half billion in assets going out of brazilian equity. chinese large cap etf actually lost nearly 1 billion in assets. people are starting to look at maybe some of the other emerging markets. like the philippines and malaysia. the fact that investors are looking to get their yield shows that maybe investors are willing to accept more risk to get higher incomes. >> paul, we will leave it there. all right. the big unveiling of the trade of the day just moments away. one of our traders are making the call. making the call on a name that he thinks is sending all the right signals. we will lift the curtain right after this. is. comes to mind fe is my high school math teacher, dr. gilmore.

i mean he could teach. he was there for us, even if we needed him in college. you could call him, you had his phone number. he was just focused on making sure we were gonna be successful. he would never give up on any of us. you have to dig a little. fidelity's etf market tracker shows you the big picture

on how different asset classes are performing, and it lets you go in for a closer look at areas within a class or sector that may be bucking a larger trend. i'm stephen hett of fidelity investments. the etf market tracker is one more innovative reason serious investors are choosing fidelity. get 200 free trades today and explore your next investing idea.

>> [ male announcer ] feeling like a shadow of your former self?

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>> it is verizon. 4.5% yield. no currency expo shoe. it's defensive. >> all right. time for the final trade. let's go around the horn. >> short brazil. >> hog. i am short and i added to it. >> i like cummins, but i think we will see more downside. >> short steel. stay short. >> all right. thanks for watching. see you tomorrow for squawk on the street. "mad money" starts right now.