here tomorrow, right? >> i'll see you tomorrow and friday. >> and friday, too. everybody is keeping square there. "fast money" is coming up, melissa lee, how is that pre-nup working for you? >> you know, unfortunately, i don't have to worry about that, bill. i have a question for you guys, though, do you like warm seats? >> warm seats? >> i like heated' etc. in my car. >> exactly him investors love heated seats as well. we got a stock, the ceo of the company, the stock is almost a triple over the past 12 months. i guess that has something to do with heated seats. we center into heat for seats. >> i love that. love that. . take it away. >> "fast money" starts right now. live from the market live time's square, pete najerian, karen feinerman and guy adam my, my panel. the stock is having its second worst day of the year after one analyst said now is the time to take profit.

now last night on "fast money," a number of our traders were getting concerned about the stock's big run before federal government week's iphone 6 announcement. >> i am long, i am selling some 105s against the position. going into the launch i'm a little nervous. >> i don't think it's the software that will be exciting the next leg of the story. >> i'm long the stock, i'm not selling. >> i'm concerned for the same reason karen is selling the 105s. >> stock closing below $99 bucks a share today. so is this the weak inside you buy? what do you think of this, karen? what do you think of the pullback? >> well, i think there could be more to do. there are two things going on, what's happening at the company, which is nothing different today probably. then there is sentiment. and this is one that i can't think of a stock that is more prone to sentiment changes than apple. i feel like the sentiment is actually changing a little bit here. so i'd stay out of the way. i will not cover my calls a little while. i will watch. >> pete. >> the september 2012, then the

stock popped out a little over $700 t. fundamentals were exactly the same story we have here. you have a stock on a great take, it went from $1700 to 385. i'm not saying that's the magnitude we will see. we have seen degrees to this move in apple. if it gets below 98, i don't think you'd step in right away. i think there is a chance if it disappoint, you can see the stock trade down to the high '80s. meaning 88, something i said a couple weeks ago and i'll say tonight. >> pete najerian, did you step in today? >> i did. here's why i stepped in. over 2 million "options action" today total. it led to everything, including all the index, including all the volume, 1.3 million of those were calls. extremely aggressive, as a matter of fact the applied vol estimate of the "options action" skyrocketed from 24 to 36% today in the september 12th. that was the most active of all the september months. september 12th. why? because that's probably a part of this whole launch date. it will be able to take that in.

the stock had pulled back to 180, somewhere in there. all of a sudden there was huge buyers so 3s. the 104s selling the 10 678z i think in the short term we contest towards that 105 toward 107. that's why i bought it. i like the paper. >> what i thought was happening in august. i was clearly wrong about that, four or five points. i do think this is probably not the end of this sell-off and what i saw was interesting. this is a massive, massive market cap sell-off today. this is a lot for this stock to move. to me, i have new information. it smelled to me, one or two kind of major players probably were trying to get out of it. people got a whiff of it. they panic and sold it down. so in the very short term, i think pete pay have a trade here. in the longer term, i think it's $80. >> you brought up 2012. i want to show you this cart we drummond up. apple launches into product launches. how does it do after?

we support this notion there is a run-up to a launch and a sellup afterwards. risk reduction is kind enough to send it to us. in 2012, it was 4.5% in the actual sale date of the new product. then it dropped 5.5% the week after. in 20s 13, it was down 8% to the sale date. then it was up 5% the week after. now, you are going to say to me, that means that there is no trend, right? because it did often things in different years in product launches. 2012 was the year apple could do no wrong. 2012 apple hit its high. it did not recoup until a month ago. 2013 was the year everybody was cynical apple. what itself the more, what's a better comparison here? 2012? >> well, i would say 2012. pete would be on the other side of it. that's what makes markets. i don't think anything has changed in terms of the apple story. i don't think that's it at all. to me it becomes a technical thing. we said, listen, when the stock

split, we said it's going to $100. it will test that high. effectively that's what happened. the stock shoots the upside. it could be on the urge of doing the same thing on the downside. let's say armageddon. you can see the stock will trade to high 80. >> pete, okay, if you are looking at the straddle, the september of next week, so you get the announcement. the fine straddle, 535. so that's telling you between 104, 35 and 94 a. little below 94. would you be a buyer of that straddle? because cheap, expensive, what does it tell you? >> it tells me, that's sort of the expected move. you think going into this that's about what you would expect right now. that volatility i was wrong, i said 36%. it was actually 43%. this is much more similar to an earnings rather than a product launch as far as how this volatility is starting to swell as we go into it. i still think it gets a little higher.

i think we get more volatility into the announcement. i think that's where you have to sell it. a day or two before apple gets up there and decides. >> put it into the announcement is what you are say something. >> i would. i expect after this dip to a downward move to get down to $100. >> i want to button up this move. where would you buy apple? >> 88. >> 88. >> i want to say something as well. 88. but the move that pete is talking about, if this gets back above that, whatever it was, 103 money 5 level. you get a couple day's settlement. i would tell you we're in an entirely different trading range. to me, this is a technical thing. so i'd rather weight $88 bucks. i think there is a chance it gets there. a close above 3 first half tells me we're an entirely few range. >> you are long, you are long. where would you buy? >> you know what, i wouldn't. but for me, it's a function of time, too, right, that cart reversal sent over says to me

that the next month's not going to be a really good trending market in apple. it won't look like this. we know it will be choppy. i don't know where it will end. it will end at 88 or 89. i will wait a month and see if there is an ecosystem bill going out there and then take a peek at it. >> well, the s&p 500 may have closed on a flat. they were on a tear today. russia's etf up 6% on fuse russia and the ukraine are reportedly working on a cease-fire plan. shares of china's exi is hitb a 52-week high reacting to the positive pmi numbers from the private sector in august. let's bring in j.p. morgan's chief emerging market analyst. great to see you. >> hi, pell many lis melissa. it's great to be here. >> why doesn't the stockmarket reflect that at this point? >> actually the stockmarket does reflect that. there has been a dramatic change in the composition of the index.

so you have big parts of the index and now growth related, so internet, tech, you have components like telco and energy, which was somewhat independent of the slow down and fixed asset investments that's going to be real feature as we move into 2015. materials are now just 3% of the bench marc. so what we find in emerging markets is our benchmarks are terribly darwinian. the sectors that have problems get de-rated viciously, when you have growth, those sectors become bicker. >> it's brian kelly. tomorrow we have ecb and europe's banks fund a lot of the emerging markets, what's your view if the ecb does qe or hints on that, how will that impact emerging market stocks? >> well, i show, i'm a bit of a cynic on qement qe 2, qe 3 were

very poor performance merging market equities him i'm not sure qe is the big story for us. i think where investors are much more concerned is when the fed starts to move short rates. now, with regards to the ecb doing something, then it probably at the margin will be more useful for greece and then turkey, due to their proximity and linkage with the european financial system. >> all right. you have recently upgraded brazil. so you are recommending that investors jump on the rally that's already unfolded? >> yeah. i think there has been a number of important factors for brazil this year. one, the price of borrowing for emerging market companies has been falk the simby yield versus come down. you've had currency strength in brazil. we've seen very strong flows into em-fixed income. that helps brazil. we also got the hope of policy change with the most recent poll showing marianna in the lead

ahead of dilma. we should get momentum into the october election, the first of the presidential poll probably the 6th of october then one towards the end of okay, a two-horse race and there is the chance that you do get a change in government. >> all right. with that change in government, with those changes in policy, are there certain types of stock sectors, stocks specifically where you see the most benefit? >> yes. we're sitting in brazil with an overweight in energy and an overweight in financials, so energy very much relates it to positive changes in policy before you do get a change in government and financial is the private sector financials should be beneficiaries of policy change. we are underweight. resource, again, indies seats are very darwin yan, the sources of the index have come down. this is a fascinating year. you've got great performance out of board of trade, even though the iron ore price is down:30%

and the soil prices down. be very careful of conventional wisdom in emerging markets. >> adrian, thank you so much for joining us. we appreciate it. what do you think of adrian's pick? brazil? >> a rally for brazil. i'm long brazil. of the two if you looked or had three up there. india and brazil, i like brazil a little better. few saw what happened in india up to the election, that's what's occurring in ewe. i think there is a lot more room to run into the end of october. >> i think you have more room to run into october. we do. if you look at what's been working, it's not just the chinese internet names we know so swell well the daded bybaidu world. >> isn't china mobile moving higher because of apple? >> i do think it is tied with apple especially with this new product launching and the fact that they are giving themselves

an opportunity to get involved more and more with the iphone. i think there are some reasons from that perspective. i also, when you look at these numbers, you go back and fort about negative number, positive number, overall i tend to look at these positive numbers. i think this is an area that will move to market side. >> courtney reagan is following young brands, moving lower in the after hours, court. >> young cannot seem to get out of this slump here. the stock is moving lower, although off its lows after same store sales for the third quarter in china, now estimated to be down an unlucky 13% the company says while sales are continuing to rebound, it continues to be negative. the stock is trading down 3.5%. after hours, it did bounce up. this issue with that meat is still a problem. melissa, back zblou courtney reaganful thank you very much. >> 17-and-a-half tons forward earnings, which is more expensive mcdonald's. this stock moved 84 to levels you have seen now. it's basically in a straight line a. little balance.

i'm not saying it's getting there. it absolutely, though, to me has to hold 66. which give or take was a low we saw back in november. below that, then we get into a whole dicey game with young, which was everybody's darling, a lot of people move. >> he said it's trading more expensive than mcdonald's. >> yes, i have. the sell for mcdonald's 102 exactly. it held that level. it has bounced. it hasn't bounced as much as i want it to bounce. you made me pick right here mcdonald's over yum. >> netflix series the details next. the car space on fire, shares of mobileye soaring. another name in the auto tech sector up 200% over last year. that's coming up next on "fast." . .

. >> delta warns or higher fuel costs. the stock falling more than 5% today kicking off our trade. beakers, the context was up in yesterday's session. so there is there also if fuel costs, they also trimmed their

margins because international capacity was down a bit. so it was 88.7% versus 91.5% last year. >> that hit every other airline stock, everybody thinking, you know what, things might be slower than expected. i think delta you need to stay away a bit. this has had a tremendous run. you are fortunate to be in it. take some profit. >> this is where some people got confused a bit pete. you got a bull in terms of across the board. you look at brent and eti. you think jet fuel costs have also gone down which is not necessarily the case. >> as a matter of fact, they put tear projections up a nickel or something as far as the price. i still view this as hey, look, they have pricing and the fact when i look at the valuation of a delta, of a united, they're still reasonable to me. >> that's what they're saying. they don't have the pricing power they've had over the past few years, that's why these

names got hurt. >> they don't have the pricing power. they still have prepricing power. i'm in the peak -- >> wait, they don't have to pricing power. >> that they had. >> okay. >> it's not to the magnitude it was at its sze knit. >> it's not in its meter. >> oh. >> what's the trade? >> you'd sell off to the airlines of this magnitude a couple times over the last year. every time you had to buy it. i don't think this is different. jet blue has been my favorite. i think peaks they go higher. >> netflix on time demands warner brothers for the gotham series later this month on fox. it will be available for streaming once the new season is done airing. >> they've done everything right. here's a stock that traded close to 490 today, basically closed unchanged, which troubles me a little bit. i get the valuation thing.

they have been knocking this stock on valuation forever. i thb in the 500 camp. it got closed today. netflix is pushing all the right buttons. >> still in disney, karen? >> i am in disney, they're also sitling on all cylinders. they've done just about everybody rooil right. i'm sticking with geiger. >> what's your position? >> i don't have a position. i think it's in the pause camp. i think there is a pullback coming and an opportunity. it's sitting there near the high end. i still feel after this move to the upside. we got some time. >> what is the other catalyst you are looking for to jump back in? >> it's about international growth. how well do they penetrate? >> it's the next quarter, basically? >> yes. >> let's get to some unusual activity, pete, king of official activity, what are you talking about here? >> we talked about germany, in

front of this monetary meeting, this policy, a lot of folks think maybe there is stimulus here, the september 30 calls, extremely active. opened at just about 2500. this is a great index for germany. it's a brend of just about everything you can imagine. you got it perfectly blended in there. 16,000 traded today. 15 cents. i didn't get an opportunity to get in this trade. i think this is a good stock, a good opportunity and a vehicle to be able to play along with this whole ecb tomorrow. >> somebody asked me today if the ecb is going to do qe. are european stocks a for the brainer? my answer was, i don't know it's a no brainer. russia throws a whole another wrench into this. that's why i asked adrian about the emerging market. where is this money from the ecbqe going to flow to? it might flow from discounted stocks him some of the peripheral plays, maybe it's turkey. that type of thing. >> it's moving higher in the

after hours session. court. >> that's right. let's check out shares, calvin klein, vh van heusen stock, the stock is trading up more than 5%. mel lisa, back to you. >> court, thanks for that. what's the redo karen? >> for macy's, a lot of what they sell goes into a macy's. i was surprised maybe they were being too conservative. some people pay think they're sandbagging. >> i love the way macy's has traded. it traded to 58 and held. we said we will probably test that 62 level again. it did. i think macy's is in that next trading range, basically trading to $60 a while. i think it wants to trade to high 60s, low 7s. >> shares by gen-therm, up, they

provide technologies to ford, gm, after the break, we talk to the ceo about what sells in the pipeline. plus, home builders toll brothers dropping profits this quarter, concerns over pricing power. the ceo doug yearley joins us for an interview coming up. .

. >> august aude auto sales, ford, nissan, toyota reported unexpectedly advantage seas, meantime, zb m narrowly missing estimates. auto makers moving with mobileye soaring. now, gen-therm the company makes heated seats and another way to

play the space, they make heated seats for ford, hyundai and volkswagon. joining us the president and ceo of gen-therm. >> it's good to be here. >> thank you for being with us. >> i was glad to right the stats, 70% of the energy goes out the exhaust pipe. your company focuses on reuseing that energy and right now in terms of what it is being used for currently in cars, that's primarily heated seats and steering wheels. are you fully penetrated on that front for that particular technology? >> no, actually our, what we call consumer comfort products have a lot of room to grow, particularly our high end product, the heat and cool seat, which has a peltier device that heats and cools air as it blows to the surface. the heated ventilated product, an interim product, intermediately priced and used less energy. so i'm very excited about the opportunities for both of those key product categories as well as our full product line of comfort products for the auto industry.

>> now, you are also i believe testing the use of elect -- or converting this seat to electricity so you can do things like charge your phone with that electricity as opposed to drawing on the power of the car. what stage is that in testing and when can you see a wider rollout? >> we have an industrial application for this where we actually build devices that go on oil and gas fuel pipelines around the world. these devices convert a little bit of parra sitting gas in the pipeline. we burn that and use the heat to generate electrical power to man some stations along the pipeline. so those products are in the market today, we are learning from those products. we have been working with a couple core companies and with the support of the doe to try to physical out a way to make these devices available to the automotive of the transportation market. there is quite a few challenges there, this device operates in an extremely hot condition in an unfriendly vierpt. something in the range of 500 to

700 degree c similar to mercury. many devices and many manufacturing techniques aren't applicable here. we are working hard. we have been part in other words with ford port company and bmw if support with the doe. we build prototypes. we have them tested at the auto industry. they're meeting up to our model and expectations. they're not imminent for the market, but we're getting closer. >> we noticed your stock went up 93% or so over the 12 months. what sort of the next gen of this technology? in a car, everybody is looking at smart technology and how a car can have sensors and read the driver in order to anticipate the needs, whether it be for safety or other reasons, how smart can a seat become when it comes to temperature? >> well, actually, we're trying to make sure the seat and the occupant are comfortable for the occupant. the primary contact with the automobile for a driver or an occupant is the seat surface.

in extreme conditions and extreme hot and extreme cold, these seat surfaces can be quite uncomfortable. so we've built devices that provide very fast relief to the occupants in those types of cliemts. we see that as being a critical part of a future environmental system pence of a car, where each space, each occupant will be able to dial in their own individual personal comfort levels. the seat will be the anchor for that. but there will be other modules, so it will be built around the interior of the car that will be in the headliner and the door panels and in the dash that will provide each person a kind of a microclimate, where they can dial up tear own personal comfort, without enhancing the intierks changing the entire cabin. >> how many years out is that? >> we are a few years out from that. we already got the seats, the seats have kind of been in the mark. that's the anchor of the discussion. we have other things to do to be able to get more efficiency out of our devices. if we are able to do that we will make the hvac strategies of

the cars more fuel efficient. they will be able to downsize the package in the car. >> thank you for your time the ceo of gen-therm. >> you look at the stock, you think it would trade, given the run it has, this stock has been parabolic over the past couple months. that doesn't do it justice. you think it would trade at a ridiculous multiple it doesn't. last quarter, it was outstanding. i don't like the way it traded today. i like, i think the stock is a stock that can go higher from here. >> a tremendous amount of upside in this. with everything they talked about, there are so many different places can you go with this. up 190%. the way i'm playing the auto industry, they do platinum plating for catalytic converts. >> have you been in a car with guy before. if i have been in a car with guys, i want my own microclimate. i don't want the same

temperature. my feet will not be the same size. >> when you were talking today about this stock, the business model of taking the exhaute, bringing it back into the car. technology, as you can imagine. however, this actually, this is interesting. it's a little rich, it is interesting. >> toll brothers' profit surging as the average price jumped this quarter. the company lowered its guidance for the year. we talked to the ceo of toll brothers in a first cnbc interview right after the break. . if i told you that a free ten-second test

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still ahead on "fast money," a warning for the housing toll brothers, cutting guidance the ceo gives us a view from the front lines coming up. we got the ce o of -- that's still ahead on "fast." first, shares of toll brothers falling 5% t. luxury home builder warning on pricing guidance and quarterly profit nearly doubled. joining us first on cnbc is ceo doug yearley. always great to have you. >> thanks for having me. there are a lot of good things on numbers, eps, revenues,

margins, especially. people seem to be focused on week orders. can you walk us through what you have seen from the close of the order to date in the order front. >> sure. so the quarter ended july and our orders were slightly down from a year ago. we're all disappointed. the entire industry is disappointed. '13 was a great year for home building. we thought it was the beginning of a recovery. we still believe we are in a recovery, but we all thought a year later that we would be further along tan with are. >> that applies to toll and it really applies to the group. so we had good earnings. we paid 100 million this quarter. we are positioned with great land. revenue was up. but the orders were flat to down and that obviously disappointed. we are very happy with where we are positioned. we are making money at this level. but, you know, we are a little

frustrated that the demand hasn't come back as strong as we thought it would off the worst housing depression this country has seen. we to the '13 was going to be the beginning of a big rally and it's been flat. so we think we are recovering, but it has been a little choppy along the way. >> so how have orders been since the close of the quarter in july? have they pickled up at all? or are you seeing the trend continuing? >> yeah. contracts in august have been down, but deposits, which are non-binding, our client puts $1,000 down and then makes a final decision to purchase a home. deposits have been up significantly. 19% in august. it takes about two-to-six weeks for a deposit to convert to an agreement and about 60 to 65% of our deposits do convert. we are feeling good of water coming in september and october. our traffic is up significantly, which is very encouraging, obviously, traffic is the leading indicator, the number of

visitors that come out to our model homes so we're encouraged by that but we'll have to see how it plays out. i think confidence is still fragile. there is not a lot of urgency right now in the market. so right now as i said, things have been flat. we are just sitting back waiting. the summer is not when we sell most ofory hom most of our homes. i wouldn't be surprised by may, june, august. >> the president of toll mentioned the remarks in the early release without the urgency, it's not causing buyers to step in. is that urgency rising rates? what urgency would cause a home buyer at this point to come in. >> right. so last year, all of the builders, including tolled a pretty significant price increases and mortgage rates began to bounce up a little bit. both of those create urgency. if you don't buy now, you will miss out the price will be up, rates will be up. right now with the market being

relatively flat over the past year, there haven't been as many price increases from us and the other builders and rates continue to stay low. right now a 30-year fixed is 4 and an 8th. i don't think the rates or the fear of a price increase is driving traffic is driving buyers. we feed a little more urgency. most important we need confidence. i think the confidence out there is still a bit fragile. it will take some time to heal as the economy improves. >> it's karen. i know you are a little on the higher end, but do you think that some of the weakness that you have seen is specific at all to your offering or sit a much broader phenomenon? >> it's much broader. all of the other builders have announced if not slightly negative numbers, numbers that are relatively flat. you know, household formations have changed dramatically. within i was a kid, i owned my first house at 26.

i got married young. today kids are getting jobs out of college, they're not the jobs they wanted or thought they'd gentlemen they still live on mom and dad's couch. they're getting married in their mid-30s. they're having children in their late 30 so they're not thinking about homeownership until a little later than prior generations. while that's not our buyer. >> that is in our food chain. i think that does affect every step of the market. fortunately, you know the eco-boomers are now getting into their 30s. they are starting to form families and households and having kids. >> right. >> i think when that begins for the starter home buyers, that's going to trickle down to everybody. but right now, the market is pretty much the same for luxury and entry level. >> doug, always great to see you. thanks for your time. >> thanks for having me. >> doug yearley the ceo of toll brothers. what do you think of the housing market? >> i tell you what, it's all about the rates, i can see the

scenario where you have a strong housing market. it has to keep rates very low, money from europe money from japan coming over here, keeping the treasury rates low, even below the rate of inflation, that will be good for home builders. i have a long itb long, i haven't pulled the trigger yet. >> you are long cold calls. >> i still think these are trade. i think when you look at the home builders, these are trades. i think when you look investment wise, you look at the suppliers the masco's, sherwin williams. that's the way to go if you want actual investments. these have to be trades. the volatility of these housing names is extraordinary. i don't think you want to be on the wrong side of it. >> time for pops and drops, a pop for cvs up 1%. pete. >> they got ap po. they talk and this name change, they stopped tobacco sales, they are making this push and while they're doing that, since that announcement, stock is up 22% him stock has not hesitated. continues to go as high, 52-week

highs today. >> pop for u.s. steel up 3%. guy. >> morgan stanley is saying what pete has been staying in the steel space. that i have a tremendous pricing power. u.s. steel is a name pete likes, nucore, it looks like they all want to go higher. >> a drop for amazon, down 1%. >> ceo is leaving, not a huge drop, a little more competition from netflix. amazon it still comes down to whether or not wall street is going to give it a pass on no earnings, whether they will look at the growth him until wall street decides not to do that. you are okay on the info. >> here's a huge drop. vince down. >> if are you priced for perfection, you need to deliver perfection. that's not what happened with vince today. a up him things were disappointing, deceleration versus what investors thought. a little inventory problem. i'd stay away. we are short here. >> we got a pop for high five. >> what?

>> on tuesday, more than 1,600 people in indiana went up top to set the world record for the longest high five chain. a new record of 1,642 beat the previous market of less than 400. the modern day fist bump the high five was first popularized by the los angeles dodgers way back in 1977. >> boy the no score. what is going on in indiana? you got nothing? i'm not trying to be mean. >> you don't think there are 1,600 people out of school that can be there? >> that seems like a lot. >> for high fivings. >> i thought you were going to say 16,000. >> let's go out to time's square right now and get 1,600 people to give me a high five. >> you do that, see you after the break. home depot and annual both suffering from potential cyber-attacks, is there a safe haven from hackers? cyber companies, barra can you do da network up 4%, how the ceo

is doing battle in the cloud. more "fast money" is coming up next.

welcome back to "fast money." home depot now saying it is working with i.t. security firms

semantek and fishnet security to detect a possible data breach. >> that we knew they were investigating, home depot still not confirming a breach, though said it is working quote around the clock to gather information. separately the website security first reported a home depot breach reported all 200 home depot stores may have been impacted by the breach based on zip code data that overlapse store locations. mel lisa, back to you. >> thanks so much for that. speaking of cyber security. the icloud photo celebrity hack is raising questions about what can be done to prevent the next sieber attack. barra kud da has popped in recent days following the moist recent string of attacks. thing to is down more than 34% year-to-date. joining us for for a cnbc interview is president and ceo of barra can ycuda networks.

>> i think have you seen a lot of news stories about these security breaches, each one of them a little bit different. j.p., mc in the back last week. apple this week. each have came it seems from a different threat factor, with apple, you know, there seem to be from what we know right now, some user culpability in terms of how they set their passwords, whether they change their passwords. how they manage. that you know, there is company responsibility, certainly, if all these areas, but there is also, you know, user awareness that can help prevent some of these things from happening. >> now you deal with companies that are smaller than apple, medium-to-small businesses. who might choose to store things in the cloud. there is a more positive way to do business and it's better for

productivity. what do you sell that help prevent breaches, security breaches, did your business pick up when there is a high profile breach like this one? >> well, certainly, when there is more breaches, we get more inquiries and more of our customers asking about what they can do to protect themselves. you can just see over the past couple of years, how many more and different ways there are for has been torres compromise business systems. it used to just be e-mail. now you have e-mail. you have websites, you have applications not only business applications, but social media applications that the users use as part of their daily work life. have you more cloud applications like sales force to run the business and work day and all of these provide entryways or potential security potential security risks for those irs. so we as an industry have to protect. on top of that have you the industry talking about the internet of things and how every

day more and more of those devices will be connected and each one of those is a security, potential security risk that we have to work to protect our customers from. >> so investors are hearing this, what you are saying about getting more phone calls with every breach that's out there. people are, companies are more concerned about how to secure themselves. when you think about the most recent quarter you posted in july. there were 8900 net users and subdescribers. it was a record, more than seasonality, 90% plus renewal rate. how do you think about that in the next quarter given the high profile security breach and all the phone calls you are getting on the back of that? >> well, certainly, for the market that we address, small and medium business. we think about that in terms of companies from 1-u. to 5,000 users. most of these companies don't have large i.t. budgets or a lot of huh pan resources to throw at problems, so there with isn't necessarily the resources there

to rush to fill security holes. they need to do it on a measured basis. they try to understand where the risks are and plan and protect themselves. so we've seen very kent predictable rise in demand for our security products. we are in two areas that have been growing very rapidly, network security, next generation firewalls, and our last quarter, we had 25% a year over year new subscription growth and storage. if you think about back-up and archive and protecting the data you have in the last quarter, we grew around 34% year over year on new subsubdescriptions, so these areas where security impacts our business have been high growth areas for us. >> thanks for your time. >> thank you very much. >> baracuda. this is an interesting stock. it ipo'd last year like fireeye,

ramped up to a high in the beginning of march and then proceeded to go lower. >> exextraordinary naerl volatile. palo alto networks, an established company has 30 times forward earnings what's the play cuda? if it can sustain itself at these levels, then you buy it hoping you see a short squeeze, which you invarably do in many of these names. i like pa and mw the best. although the price action today bothered me a bit. >> you are own brian kelly, aka, beakers, has his own theory how apple and other companies can prevent future cyber attacks and surprise, surprise, it has something to do with bitcoin in there it does, bitcoin as more than a currency. at the heart is what's called the block cane, what it is is a big database. the problem have you with let's use apple, for example, is that both your password and your data are stored on the same server.

all the hackers need to do is hack into one place. they have all your information, with bitcoin and the block chain, in particular, you store your password on your computer. so that means, what the block cheney allows to you do is encrypt that password and send it between you and apple, let's say, and get your information without anybody being able to get that password, so it adds one level of security. think about it this way, if the hackers get into apple and they're using a block cane type of application, then they have to go and hack every single person's computer to get their password off of that. then they have to go out and control the block chain or the network that the passwords are sent over. so it adds multiple layers of complexity, multiple layers of the security. it comes down to being de-centralized. that's what split coin is about, a de-centralized security. >> so centralizing everything, including passwords on a farm that can be hacked.

>> right. >> you store it on your own computer. so hackers have to hack individual computers in order to do a misive breach? >> absolutely. you have to hack 100,000 individual computers. >> wow. okay. recent ipo, el pollo loco, where traders are betting on a huge move in the stocks right after the break. .

some traders are betting on a crazy move with el pollo loco. mike. >> right now the september at the money straddle in loco is about $5. >> that expires who weeks from friday that's suggesting it could move up or down, one of the places i thought was interesting that we saw some interesting option, buying activity was the september 33 puts and they were paying about a dollar and a quarter for those, so buyers are expecting loco will be below that $33 strike price by what they spent or below 175 by expiration. that's probably a bearish bet looking into earnings tomorrow, thinking it could be down

potentially as much as 9%. with a short interest this high, shorting the "options action" is probably the only way to go. >> tomorrow we come right back. stay tuned. ♪ .

final trade, pete. >> delta is flying higher. >> beakers. >> stay long energy, xle. >> i like sun edison. >> guy. >> i'm melissa lee, see you back here for more my mission is simplt -- to make you money. i'm here to level the playing field for all investors. there's always a bull market somewhere, and i promise to help you find it. ma "mad money" starts now. hey, i'm cramer. welcome to cramerica. my job is not just to entertain but educate and maybe teach here. call me or tweet me. oh, boy. we've got a real tolstoy market going here, one where russian