tv Fast Money CNBC June 3, 2014 5:00pm-6:01pm EDT
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we have got shark tank coming up tonight. >> well, you know, small business in america is where growth is going to happen. i'm depressed, kelly, about the news out of seattle. $15 an hour. sheer insanity. it's crazy. this disease has to be cut off at the hip. i hate this story a lot. >> we'll leave it there. "fast money" coming up now. melissa lee, over to you guys. >> we are live live in new york city's time squares. traders are dan, brian, karen and guy. a potential exit date for tesla ceo at the tesla shareholder meeting. >> what i am committed to is to be ceo of the company through volume production of the third generation car. that's somewhere in the -- i don't know -- four or five year time frame.
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and then i have to see how things are going at that point. >> so what would tesla be without musk? our top story come from the other auto movers today. light vehicle sales coming in the highest since february of 2007. general motors blowing sales expectations out of the water. best monthly sales since before the collapse of lee man brothers. >> i think the public seems to be shrugging it off entirely. i don't know if it was the older ones with the ones with the problems. i don't know. it is a very broad, very strong report for everyone really. and it makes you think the consumer is really still out there. >> and shorty pants down there, you're bearish on the market. what does this do to your thesis? >> the sales were amazing. if you're of the mind set the payroll on friday is better. this is a great piece of data
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showing economic recovery. i would just make one argument. you say the best since 2007. that scares the lights out of me. is it as good as it gets? c'mon. maybe it is as got as it gets. >> would you say crappy sales are the worst thing? that would scare you as well. >> they're trending a bit with the jobs. so let's see what what the jobs number looks like. >> what i don't understand is why nobody was worried about the season effect. every factor has been impacted by weather. now you get a snap-back in cars because people couldn't buy them in the winter. why does anybody -- >> we had grant aragele improve in march, april and may, so why --. i would be skeptical that this is the trend going forward. >> you know, i think the stock
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performance, given the -- although we bounced off the 32 level. given the numbers, i thought it would be higher than it was today. that has me somewhat concerned. the way to play it and we have talked an the downstream plays, but alcoa, we talked about that, you look at alcoa's report and look at the aluminum car market, that stock is at levels from 2011 and appears to be breaking out to the upside. >> here's a good one for the genius over there. >> whoa. >> may sales, we saw target and walmart's guidance. we had costco miss. to me, is it what beak is talked about pent-up sales and culminating in a big month at the spence of big box? >> it is possible it was the spence of something. we saw this phenomenon several months ago where it was big ticket items, little ticket items were can balance leased by
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big ticket items. >> tit for tat. >> yeah. >> i want to get a trade from karen. >> go ahead. >> karen? >> gm. you know what -- >> you got out of it. >> because i'm an idiot and i think that we have seen how the market is going to respond to the major recall on all the issues that are just going to shrug it off. we have seen so much data. front page of new york times over and over again and yet the market doesn't seem to care anymore about that story. >> are people jumping all over each other and forcing this thing back to the high 30's. if people were in it and got worried about the news flow, are you going to have to get back in? >> yes. i think. for me, yes. >> tesla holding its 2014 shareholder meeting today and musk spoke about his plans for remaining ceo for the next four to five years as well as tesla's stock price and its future. take a listen.
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>> the potential for tesla to be one of the most valuable companies in the world for the long term contingent upon our execution of course. the difficult thing is to say will the stock market value us in the short to medium term. that is impossible thing to say because the stock market is kind of a manic depressive. particularly with respect to tesla. we're making some good progress on the auto pilot side. and you know, i'm confident that in less than a year you'll be able to go from highway on ramp to highway exit without touching any controls. they gave us a call and said they were going to sue us for using model e. like ford is killing sax. >> why? >> because ford has model x. anyway, joining us now is
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research analyst. ben, great to have you with us. >> thanks for having me. >> must talked about the stock market as being manic depressive when it comes to tesla. last time the stock was 178. the stock is up 14% since you told viewers to buy. the comments of musk leaving in four to five years. does that make you confident we're still going to have the founder so integrated into the brand of this company? >> i would say that was one of the biggest take aways. he wants to get the model e out on the road in commercial valiums befovaliue volumes. it's good to hear over and over again and good for investors to hear. >> in terms of your rating on the stock, you would say that investors should aggressively buy the stock even from here. what is the catalyst at this
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point. is it the ginga factory and are we going to see -- in terms of the battery in order to actually drive adoption of the tesla vehicles, particularly the gen 3? >> i think we have a quarter lined up nicely for a solid beat. production is very good. we were out about 2.5 weeks ago. i think deliveries are going to be strong for the quarterment we should see margin improvement over the course of the year and all of that, we have the back drop of hearing about the battery factory which at the meeting he talked about the relationship with panasonic and how that's progressing and how panasonic sees it viable for tesla. and at least something we can see in q4. all of those would be catalyst. i think the second half of the year is going to be strong for
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tesla. >> it's your topic for the second half? >> it is. >> i want to ask you about one of your competitor's notes and this is from bank of america. the battery factory would lead to battery cost savings about 30% which would get to 175 per megawatt hour. in terms of what an ev would have to have in order to make it competitive with internal combustion engine it would have to be 150. is that true? >> i think one thing he said at the meeting is they're confident they can get to higher cost savings than that. my competitors have been wrong the whole time. i think you have a price target under $100. time will tell. so far so wrong. >> ben, just to push back on that journal article, one of the senior officials of panasonic expressed concern that maybe the cost cutting -- you know, that the batteries ambitious battery cost cutting goals were too ambitious.
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is there some pushback from panasonic? >> there was originally and he admitted to that today. he talked about having daily meetings with panasonic and then in larger more senior management level meetings weekly as panasonic gets comfort with making a billion dollar investment sometimes towards the end of the year, beginning of next year. >> you got back from china. what were the take aways there? is your topic still sun power? >> yeah. so you know, headed into china. there has been some worries throughout the year. even at the beginning of 2014 oob about demand in china. they'll hit their internal targets for solar installations. i left feeling more positive on hitting their targets. i think the government will step in and correct it if they don't see progress there as we head into the year. definitely the chinese solar
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companies were feeling better about q2 and into q3. after the market closed, we did get news on chinese tariffs coming into the u.s. a little higher at first glance and expected. so that will put pain on the chinese guys selling into the u.s. specifically trina solar and yingley solar have exposure to u.s. sales. sun power continues to be my favorite pick. minimal exposure to china and best in breed across the board. >> all right. thanks for joining us. appreciate it. >> thank you. >> i want to correct myself. i was talking about megawatt. it was kilowatt hours. sorry about that. ben thought it was a good take away he's committed for four to five years. >> i would rather buy it if it got back to that 225 level. i think right here you're flipping a coin.
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if i may, manic depressive. we don't use that term anymore. we use bipolar disorder. >> a note to elan musk. >> i'm letting you know. it's bipolar disorder. thank you. >> speaking of solar stocks, dan nathan spotting one name actually headed for doom making it the newest member of the triangle of death. dan. >> it could be. the purpose is exercise obviously to be dramatic but also to spot things. this stock shows absolutely horrible relative strength both to the peers and broad market. it's down almost 50% at one point from the highs in march to the lows last month and now it's within 10% of the lows. those are the things that make me nervous. look at the chart sitting right on the neckline at $50 or right below it. these are things you want to avoid in my opinion unless you
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have some fundamental reason. it's pretty dicy from a technical standpoint. this is a tough stock to short. elan musk owns 23% of the float. 27% of that float is short. you do not want to get caught short this thing. i'm just going to say this. we say it all the time. you know what, if you're a trader and you can be nimble, you put the short out and now it's below 50, that's where i think you press it. >> developers conference pushing shares up today for apple. and you may not know enter digital but you probably know it's products. samsung, apple and blackberry. we'll talk to the ceo of the latest big stock move on our first cnbc interview straight ahead. we route your order to up to 75 market centers to look for the best possible price, maybe even better than you expected.
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thetial winners and losers. we start off with the potential loser. that would be facebook. facebook bought for $19 billion earlier this year. cofounder and ceo tweeted very flattering to see apple quote, unquote, borrow, numerous what'sapplication features into imessage. apple borrows features but actually makes them better. >> think about all those separate apps and their putting it in one thing. that was the thing watching that two-hour presentation that excited me as an apple consumer. but excited me if i was long the stock. they're really creating something i think is going to be cross platform. i think ios users, when this comes out, they're slowly going to drop it.
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>> the whatsapp. >> i think that could really make the purchase price of $19 billion for facebook for wha whatsapp look silly. >> one potential winner from wwdc is microsoft. one blogger said the conference proves that microsoft has got the mojo these days and apple is looking old and stale. microsoft's new skype translation. >> i think microsoft does have their mojo back. i think you can easily see that. valuation is still reasonable. last quarter was outstanding. i'm had pressed they can replicate in the next quarter. if they come close, i do think much like apple, the wind is at the sails of microsoft now.
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>> karen what did you make of what was announced yesterday in terms of home automation and the health roads versus microsoft? >> i sort of agree with dan. that some of these apps are going to be -- the more you can get the ecosystem and the more they can get into every aspect of your life. every device, every aspect. i don't know exactly which ones are going to work. you know they're probably throws stuff out there that is not going to work. to me, i think apple is one of the winners out of the conference. >> and are you long? >> i am long. >> you are long apple. another winner from wwgc could be bitcoin. apple says apps could facilitate the transmission of approved currencies as long as they comply with state and federal laws. recently banned bitcoin. beakers? >> it's a big movement they definitely left themselves some
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room to not accept bitcoin or any particular coin out there. it's a big move. how do you play it besides just buying bitcoin? i suspect the move was in anticipation of this as well as anticipation of dish network accepting it. but a direct -- u.s. stock market plays amd. i think around $4 amd is not a bad way to go. >> apple had more to lose by continuing to block bitcoin than bitcoin had to lose. >> absolutely. all the android apps are eating it up. only developing for android. and people are switching phones because of it. apple had to make this move. we'll see if they follow through on it. >> a couple firms today upping the terms today. you also saw big options trade. >> trading two to one over puts. a day after the worldwide
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developers form, this is a massive trade, people, you have to be open when the stock was 632. they sold 8,000 of the july 600 calls at $37.90 and rolled up the premium to the july 680 calls. think about what the break-even is on july expiration. up almost are 8%. no identifiable catalyst. earnings are going to fall in august's expiration. but what's coming, people are geeked up about this thing. when you look at the chart, i think we have a three-year chart going back to 2011. look where the stock stopped, right there. at 640 the other day. they want to see new highs by july. >> this sort of mirrors up with your thesis that it's going to hit 700. >> yeah. i think so. it might be 700 pre. we'll see that's what makes
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horse races. >> all right. more options action every friday. check out the website optionsaction.cnbc.com. find out which names you might be able to roll the dice on after the break. plus, samsung finally taking the wraps off the first smartphone. an inside look at the big unveil straight ahead. ♪ [ bell ringing, applause ]
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five tech stocks with more than a 10%... change in after-market trading. ♪ all the tech stocks with a market cap... of at least 50 billion... are up on the day. 12 low-volume stocks... breaking into 52-week highs. six upcoming earnings plays... that recently gapped up. [ male announcer ] now the world is your trading floor. get real-time market scanning wherever you are with the mobile trader app. from td ameritrade.
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our top trade tonight. up weeker than expected. 9% in may. well below the estimate. >> the weakest in a year. we know the u.s. casinos get 3.25% of their earnings. this is not one of the things you want to see go in the summer. i think you want to be careful at 200. i think if it breaks it's going straight to 180. >> it's the triangle of death. >> we have been highlighting them. >> next up, fanny and freddy, betting big on the revival of the two mortgage giants. icahn bought fanny and freddy shares. >> more interesting to me that they're wanting to sell. i think this is really a binary situation.
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it will take some time to play out. whether the equity is allowed to exist or gets wiped out. i think it's an interesting very symmetric bet. >> up next, a partnership with american fashion designer. the new designs will be called dvf. >> there's no shock that i would wear those at all. >> inspired google glass. >> look at those things. they look like the blade thing you used to wear back in the '80's. or dan did. i think this doesn't move the meter for these guys at all. i think obviously all these we'rables are going to get in the fashion. it's probably better for the fashion houses but hard to trade that. watch google. google is starting to roll over. we saw it roll over back in march. i would use google as the
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barometer of the market since it is such a crowded trade. >> they're so ugly even if they're designed by a famed designer. you would actually be a negative with such a -- >> not if they make it better. it's not necessarily a geeky product. it's kind of neat, right? but in you made glass that is looked like bk's, we'd probably wear them. >> take a look at that. another trade school. >> coming up next, shares of wireless technology company enter digital soaring over 20% today. samsung, the ceo of the company talks to fast right after this break.
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>> samsung trying to ungoogle itself. it will begin selling a smartphone running on its own operating system. trying to step back from google's android operating system. it will first go on sale in russia and will be called the samsung z. fingerprint censor and coming in two colors, black and gold. samsung controls with a 30% share but it's google that controls the software running those devices. android's global market share stands at 81%. of course, apple will argue that it's not market share that matters as much as profits and how much consumers really use their devices. its operating system, ios, makes up 50% of all mobile use according to net applications.com. at the conference tim cook took a shot at android. take a listen.
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>> almost nine out of ten people in our install base are running our latest operating system. this is in stark contrast to android. if you look at their latest release, less than one out of ten of their customers are on their latest software. >> so bottom line, samsung wants to control its open destiny and it needs to control its own os. patrick moorehead is skeptical and offers an important caveat. users could be swayed if samsung can get android apps to run on a tiazon platform. it's the applications that really matter. back to you.
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>> samsung reaching a patent deal with interdigital. sending the stocks soaring more than 20%. let's bring in the president and ceo of interdigital. great to have you with us. this is a major deal and in place with 2017 with option to renew. and it covers 3g/4g. what could that mean and is it more than just phones? >> it's principally 5g. this has been an industry continuing to innovate and satisfying the consumer demands. with it being a potentially ten year deal it's going to cover those new generations. >> how can we understand it in terms of what you make per samsung device, is it more than the deal you had in place? is it more favorable to you? >> the company issued guidance and we guided up based upon new information which included the samsung deal.
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very strong revenue going forward. we think the agreement maps into our rate structure. we have been licensing for 20 years as a company. very strong in terms of how it projects out for the rest of the market for us at 50% of the market underly sense based upon an annualized number now. could take us up to 600 for the rest. >> what does this mean for the deal that is are yet to be negotiated? you have an apple deal in place expiring this month. and i'm wondering what it means for the litigation regarding similar patent? when you sued samsung, you sued zte as well as hargway? >> it's a great statement by samsung in terms of -- also sets a benchmark -- other people can -- they're paying a certain amount and getting the benefit as the biggest player in the
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market. at least they now know where samsung is in terms of the value they're providing. i think it could be a good bit of momentum for the company to drive the other license agreements. >> so will you use this in your negotiations with apple? >> absolutely. samsung has signed on. we would want to get a comprehensive agreement in place be apple. >> your market cap is $1.5 billion. working out to be $17 a share. what is your capital allocation plan having 17 bucks a share in cash doesn't seem to be the best way of using that money. >> right. so the company has been very aggressive in buying back sharings. we bought back 40% of the shares. 3.25 of a billion dollars i think is in shares. as we go forward with this deal in place, you'll probably see the company in the short term,
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losing capital -- >> it is -- i don't want to say safe to say but investors could be led to believe that you will lose -- >> we guide as to what we know. and so -- but i think the signals you could see as we begin to move our capital allocation policy that shows high confidence in our cash flows, that will be an indicator the company has strong belief in its future which we do. >> you remember it to be a takeout target by apple, qualcomm. is there any truth to that. can you tell investors what your plans are in terms of remaining independent? >> we run the business and we run it hard. if somebody comes in and make as offer you look at it. as a management team you focus on running that company and driving the hardest value.
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>> thanks for coming by. big move in the stock today. >> you were getting at, i think, it was may 21st they gave prior guidance. the fact the stock is up 20% today alone leads -- this stock with the market cap you just mentioned should not be as volatile as it is. doesn't mean you can buy it here because i think you can. it was just a few weeks ago where they gave guidance and the guidance today was spectacular of what was said a couple weeks ago. not a big valuation. 13 times forward earnings. it's going to be a volatile ride. on the margins this is stock you want to own. >> you have been in the patent sort of look out? >> yeah. i have been looking at it. i think it's too hard for us to understand. but good for him. he understands it clearly. he's winning. good. >> time for pops and drops. got a pop in the meat space. hill shire brands up 9%. >> big pop.
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you also saw cattle prices real all-time highs. if you want to go second deliverty watch something like a chi poelt lay. >> a slew of analysts that came out and downgraded the stock afterwards which is not helpful and i don't want to pick on gold man but they should be above that. they were one of the groups that did it. that said, traded 50 times normal volume. blew even out. i don't think you can own it tomorrow. but i think this is a stock that given this flush you might want to take a look at a trading vehicle. >> dollar general, a pop. >> earnings this morning, at first they weren't that excited because the quarter wasn't so great. but the second half of the year things seemed a bit rosier. if you're concerned about the consumer, this would be a place you want to go. this or walmart. but i'm not as concerned.
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i'm an optimist. >> right. you guys are in my camp. >> pop for skyworks solutions up 6%. >> these guys have raised guidance twice in the last six months. i wouldn't chase it here. also trading 13.5 times expected earnings next year. it's a pretty cheap stock. i would probably wait to come back into the high 30's, maybe 35 where it broke out from. >> blast from the past. my space, digging deep to get users to come back to the site. is it in the midst of a revival or the latest marketing attempt? coming up we talk to former myspace executive on whether or not they'll move the immediatele. much more fast straight ahead. and the rush i get, lasts way more than an hour.
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she can print amazing things, right from her computer. [ whirring ] [ train whistle blows ] she makes trains that are friends with trees. ♪ my mom works at ge. ♪ myspace wants you back. the company spending last month sending former users old profile pictures with the caption your photos redelivered adding the
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good, the rad and what were you thinking with the link back to the users former profiles. is this the beginning of a revival? with us is former myspace executive. travis, great to have you with us. >> thanks. >> most people remember myspace back in its hay day when it had 79.5 million users. today it's got 36 million users. is it possible that it could come back? is this a ploy to get people back? >> it's a ploy to get people back but i wouldn't start shorting my facebook stock just yet. but the world's moved on to mobile just now and my space hasn't been investing in mobile. they have had a very small team supporting a big product. they have fallen behind the times. >> what is there value in your view? is there a way to salvage something whether it be on the
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music side as a different thing from what we all know it to be which is the social network before facebook? you know, i think that actually it's a interesting opportunity. one of the things facebook played up a lot in the early days it was about your real name and identity and making everything your whole life public where myspace people used private names. they could make up whatever name they want. there's been a big shift in the market back to people being concerned about privacy. not wanting their -- all their lives being public online. i think there is an opportunity for a site like myspace. that void is being filled by companies bike snapchat where the young people driving these trends are flocking so they can share things in a way that's more private. that their parents aren't going to see. i think for myspace to move into that, they would have to acquire
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someone bigger. to build something a bit more. >> i want to flip and take a look at facebook. we were thinking about and talking about myspace. i was under my impress it was popular in the '90's. and reached its peak in 2008. can you see a road where facebook will become the myspace of the future? it happened so quickly with myspace. >> you're right. i think there are signs to watch with facebook as well. one of the early sign that is we saw at myspace, the pred -- precursor to the decline was we started seeing both the total growth numbers starting to flatten out and using the youth on it. it really is the young people, the millennials drives the trends. the top line growth has slowed
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down to 4%. while they're shifting people to mobile and they have an incredible number of users. i think they have 600 million daily mobile users. but a lot of the younger generation, they don't use facebook as their main source of social networking. the advantage facebook has is they bought instagram. ultimately people are fickle. i think if the -- the numbers to watch if you're holding facebook stock is how often people are coming, the total daily numbers and are they flattening out. if they are, then that's when you start to worry. >> thanks for joining us. appreciate your insight. travis, a former myspace executive and now over at go go bots. dan, you said that a couple of times. >> i think about their core product the way we do about
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myspace. >> myspace didn't innovate. right. we talked about maybe the stock is overvalue. but at least the company is innovating buying the new products which myspace didn't do. >> we figured let's share a picture from guy adami back in the day. here are some of the winners. that is his college graduation. >> thank you. >> runner up comes from daniel bear. i pray i get that job at ups. i would look great in those shorts. >> good one. i like that. >> look at that. >> wow! >> look at those legs. >> remember those shorts? >> that's bow-legged. >> no. but they're tanned. the winner of the caption contest is matt neville. the cousins from perfect strangers graduated college. the show from the late '80's and early '90's. >> it's cute though. >> maybe an album cover.
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>> maybe. >> which one was that? which is that one? >> i don't know. i have no idea. let's get an earnings alert. checking on kidco dropping in the after hour's session. dom. >> give me a second. i don't know if guy is -- >> he loves the show. this is the most fun you have. >> i'm having a blast. you and ups. i love it. anyways, let's talk about a serious thing. tipko is dropping big in the after hours. it reopened with news pending. the news was that its preliminary results for q2 were out and missed expectations. looking for a gain of $267 million. the warnings is it's going going to make 12 to 13 cents a share.
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the stock is off its after market lows but still down 12%. one of the financial software companies and they blamed the weakness on one of their data analytic suites. we'll watch those shares. back over to you. >> still ahead, the consumer company taking on johnson & johnson and winning. we'll talk with the ceo after this break.
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. microsoft being pictured with mark and we see -- where were you in the enemy game? >> we're friends with microsoft and frankly, our competition is doing what they feel they need to do. if they feel certain weaknesses in certain areas partnering is what they need to do. >> a sneak peek at the interview. >> you know, if you don't want to play sat's with microsoft. i think that's what you ought to
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do. if you don't like what the ceo said, then you can buy oracle. >> meantime, let's talk the company behind clor septic and pedia care. up near 30%. the company has been on the hunt for new acquisitions. joining us the ceo of prestige brand. cold season wasn't bad. which is not good for you. what do you think for allergy season? >> it was a blockbuster season last year. it's still a very good season this year considering versus the normal year. >> so you anticipate the allergy season would make up for the softer sales in the cold season? >> i think we'll see a solid allergy season as we have a diversified portfolio. we can make up for it in the number of brands we hold. >> you have been inquisitive.
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you bought insight. that will be the biggest brand, and you also bought an australian company called hydrolite. what's your strategy here for more acquisitions? >> well, again, i think our strategy is consistent over the last few years. we're going to be aggressive and disciplined in m & a. the inside acquisition is our sixth acquisition in the last four years. we're going to continue to be aggressive and disciplined in terms of otc acquisitions. >> you have been building this portfolio. when i think about somebody like a clorox, they want mega brands. is there enough room for you to continue to grow without being sort of -- >> i think that's the beauty of the otc category.
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it's a very fragmented category with a lot of players in it and players like us that are a lot of pt versus battle ship. >> a lot of people think the rates are headed higher. will a higher rate environment hinder you from making acquisition that is you want? because you're not that big of a company in terms of market cap. >> i think that would play into our m & a strategy and adjust accordingly. >> appreciate it. ceo for prestige brands. stay tuned.
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we want to get some tweets. sit time for me to finally listen to people and get out of garman for a while? >> what does that mean? >> you have been saying to buy garman. >> i mean, if you have been in it, unless you have bought it today, you only made money on it. there's nothing wrong with taking a profit. i think the story is very much intact and i a strong believer
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in garman. what do you call that, the wearable tech thing? >> yes. >> who talked about it being the wearable tech? >> you. saying buy garman for a long time. karen? the most recent bank of america mistake present a buying opportunity? >> i think it does. this is really a minor issue and embarrassing but they have taken steps to rectify it. they have resubmitted. i think that even if they don't get what they thought they would have got and issue a dividend, eventually you will get there. i'm patient. >> time for the final trade. dan? >> if you gain from the 50's i think you take them here. i can see the stock back. >> beaker? >> we talked about getting some respect. microsoft i think you buy it here. >> karen? >> talked about it earlier. gm. i think i got to buy it tomorrow. >> getting some mojo back.
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>> mojo. >> well, north of 10. now it's got it working, jetblue. >> i'm melissa lee, thanks for watching. "mad money" with jim cramer starts right now. \s . my miss is simple -- to make you money. i'm here to level the playing field for all investors. there's always a bull market somewhere. i promise to help you find it. "mad money" starts now. hey, i'm cramer. we8 come to mumm. welcome to cramerica. other people want to make friends. i'm just trying to make you money. my job is not just to entertain you, but educate you and teach you. call me, or tweet me @jimcramer. when you see a powerful trend, you don't avoid it
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