in the third quarter? we've also got an exclusive interview with the ceo of taser up around 8% on the day. on the back of strong earnings. a boost in demand from the ferguson episode over the summer for on camera officer devices. we're going to talk to the ceo. >> we're going to see more of those. strakt over to you guys. live from the nasdaq market site in new york city's time square, i'm melissa lee. our traders are tim seymour, dan nathan and steve graz grasso. first, bad news out of citigroup. shares falling after hours. the company announcing it is cutting its third quarter results citing rapidly evolving regulatory inquiries. we've got the latest. starbucks, linkedin, groupon, expedia, starbucks getting hit particularly hard. after missing on revenue. we'll bring you the latest on that call coming up is and go pro getting a pop on earnings. whether this is a bounce worth buying. let's start with news out of citigroup. kayla tausche has the details. >> yeah, just after hours, we

got a press release in the form of an 8k from citigroup where the bank said it would be reducing the first quarter profit from $3.4 billion. and that's because of what it calls rapidly evolving regulatory inquiries and investigations, including very recent communications with certain regulatory agencies. now, the bank says this is related to previously disclosed matters. and it says there will be elaboration on those matters when a 10q is filed after hours. i got an alert on my phone right as i was coming on the air that this filing has hit. and i am under the impression that at least part of the money that is being set away from the earnings will go to cover an ongoing currency or fx probe that circles several different banks on wall street, including jpmorgan, which itself in the third quarter took $1 billion charge to cover largely fx issues that it was facing as

well. but melissa, i do expect as soon as we do get that 10q that there will be detailed language about exactly which regulators are investigating this issue. and potentially, language about how close a settlement might be. we did see some other banks in addition to jpmorgan and citigroup taking some legal charges related to outstanding issues like this. so it does feel like something is getting close, if maybe it's not imminent just yet. now, melissa, i think an important distinction we should make is the reason why citi had to come out and restate its third quarter earnings is because of the timing by which this material information was obtained. it happened between when the bank released its third quarter earnings, but before the 10q was filed. meaning that if it had a chance to update that material information in the 10q, then legally it was bound to do that. if this information had been obtained a couple of days later, then perhaps we wouldn't be getting a restatement or this would count toward next

quarter's earnings. but because of when this information came to pass, the bank had to restate its third quarter earnings. so that's not to say that they are withholding information from investors. they're simply getting out in front of new information that is deemed material that they obtained from regulators. melissa? >> all right. we'll leave it there for now. but check out the 10q and we'll check back with you. in new york with the latest on citigro citigroup. there's the answer as to why they're taking it in the third quarter as opposed to the fourth. what had gone on. and that's because it fell into the time period between when the earnings report and the 10q was officially filed. how do we trade this at this point? it does sort of set up, kayla had mentioned a possible settlement. isn't that prime for a rally? >> she hit a lot of important words here. also, this was a previously acknowledged, you know, probe, this was stuff, related to a settlement something they couldn't report in the numbers. it's about putting a little bit of rational thinking into a company that quite frankly

continues to disappoint us and this is whether failing -- you know, kind of judgment back, few months back which was for the stock ultimately a place, actually also to have bought it. if you look at citi's numbers between 47 and 49, you have very, very strong support in the stock. from an earnings perspective, this doesn't change the valuation. i am long the stock. this to me, if you get a major selloff, these have been opportunities to buy and as you pointed out though, mel, settlement, very important for citi, getting behind them, which i don't think you can do. >> with stock down in the afterhours, how do we set up for a trade here? >> this one rallied 10%. down with the market and now it's been back up in a straight line, down about a buck, couple percent here. i think you want to let these things wash out a little bit. if there is a settlement, that's a piece of news we don't know. it's back ward looking now. tomorrow, we're going to get a good sense for what other sort of settlements you may have had. what are some of the other litigation liabilities. and so to me, i think you want

to give a little time, i don't think you jump in here. >> if you get weakness like wells fargo. it's up 15 year-to-date. it's a different type of name, different type of bank. if you see a selloff in this. this is not going to be the same picture as a citi. i would take advantage of that and buy that on a dip and stay away from a citi, bank of america, even though that's been performing quite well up 10% for the year. i would stay away from those names and get back into wells fargo on a dip. >> if it is, though, you wouldn't go to a bank of america. you'd probably think, oh, maybe there's a jpmorgan exposure. >> there is. and jpmorgan acknowledged it. the issue you have here, one, cy city bank. how did it happen rapidly? i know they're happening within two weeks, but other bajs were able to assess what they thought the cost was. you have to question what's going on with the l kros it's n controls that it's not getting to the right people. if you're in city group, don't panic and sell on it. i personally do not want to be in any of the banks, but that's

based on what the yield curve is doing. yield curve starting to flatten and that's not good for banks. >> you touched on a bigger issue here for investors. and that could be the controls that citi has in place. are you questioning the management of citi? >> some of the things that have gone here. >> right, exactly. >> how do you know this is a control issue? >> one of the things you have to question that. seems like a control issue. jpmorgan, barclay's, rbs. we all know there's an fx rigging case going on. within a two-week period, $600 million. >> when they had to file their reports. >> but $600 million in two weeks, that's a big number. >> it may not have been materials or something. i hear what you're saying, but to say that suddenly this is a company who has a lot of strikes against it in the past based upon how they've governed. but to say this sounds to me more about accounting for legal costs that quite frankly sound astronomical. but it doesn't surprise me. >> but i think it raises a bigger question. and that is, if you had to

choose amongst the financials and they're all equally or close to equally exposed to a rising yield curve and the benefit because of that, why wouldn't you go to another financial without these possible, you know -- >> because -- >> control problems? >> because citi trades with this kind of a discount. and there's no question that you're buying a company that's not been as -- >> doesn't it trade at a discount because of this, right? every other bank doesn't have this problem. citi trades at a discount because you're worried about the control issues. >> i said. i think you're rewarded and have operational leverage if this environment turns. their earnings potential will be that much greater. yes, you have things to worry about. >> we'll have much more on citi. meantime, let's get an update on starbucks. dom? >> that's right. down by about 5%. shares of starbucks moving lower in the afterhours. matched expectations by earning 74 cents a share in the fourth quarter. but revenues came in light. comparable store sales, 5% was

the gain there, analysts on average expecting 6.2%. the company gave full-year earnings guidance that was below what wall street was forecasting. that full year for fiscal 2015. so starbucks shares as a result, you can see down by about 5%. the conference call, melissa, is going on right now. we're going to hop on that and we'll bring you any relevant details when they become available to us here. back over to you. >> thank you. and dan, you've been skeptical the starbucks trade for a while. >> you have valuation. we also know there's a lot of names in the space that rely on expected foreign growth. to me, this is a company that trades at 24 times earnings. sales and earnings were supposed to grow high double digits in the teens. and they just guided down. so you have to be a little bit skeptical. i know that tim likes it. but here's a stock that's been bound for a year now between 70 and 80, and it's been a good buy down in the low 70s. and it's been a great sale in the upper 80s. i suspect you see it back at 70 soon and that's when you maybe take a shot. at some point, those expectations will be low enough.

this is a company that deserves a premium valuation. i'm not sure it deserved to trade 25 times earnings. >> you stick with this trade? >> i'm long the stock. and at one point, it was a big position. not as much. it's been a sideways trade. but at 24 times multiple, it's a stock trading expensive to itself 12 months ago. this is the first time they've -- this is a big deal for this company, but i think they have significant earnings drivers, two or three catalysts on the food front and i think also on the international front. this is a company that will get their growth. we're talking about high teens growth and that's something that can support. but big disappointment today. >> the restaurant name. dominos pizza. i've been speaking about it for years now, but it's a new annual high. >> how do you think we feel? >> it's not because patrick doyle gave me credit for the gluten free pizza idea. you look at this name and it's growing internationally. so when it needs to be strong

off of u.s. shores, this is where you want to play this thing. up 27%. >> again, starbucks is moving down about 5% in the afterhours session. tomorrow, do not miss the cnbc exclusive. 9:45 a.m. eastern time. now, let's take a look at some of the internet names reporting after the bell. linkedin, groupon, expedia compared to the poor stock performances immediately following the earnings of some other internet stocks like facebook, twitter and netflix. is this a good sign? even groupon is up, dan. skeptical of this whole entire -- >> i took a hard look at link linkedin today. to me, this is one that it trades at a premium valuation again here. we look at opportunities, we look at investment opportunities based on the addressable market. they have a addressable market. not just levered to advertising.

but at $200, i'm not a fan right here. i think this is one that's 50% off of the lows in may, 15% off the highs back in january. i think you want to buy it when it's really depressed. i don't think you want to buy it here when it's going to be up on inline results. >> i'm sorry, go ahead. >> i think the comps in this company start to get a lot better. the earnings multiple is -- i don't think there's anyone close to them. starting to gain traction. there's better things ahead for these guys, but you don't have to run in there now. >> everything that twitter has wanted to do with their interface, it seems like link linkedin has been able to do. you would think they would do worse. but it's actually, people just dump in more because they say, i haven't been on linked in, i haven't accepted those invitations, but the jobs market seems to be doing better. now there's a real catalyst to actually be on linkedin, when you wouldn't think so when the job markets -- >> and they've been making a big

push with content. >> listen, it's a high valuation. i'm with these guys, i don't think you jump in tomorrow. i think the best way, really, to trade this, though. you wait for tomorrow if you get a reversal to the downside tomorrow, then i would say linkedin's a short. and the reason i say that, when the news initially came out, this stock was down, which tells me people are very quick to sell the stock if there's any type of bad news. >> go pro, by the way, popping in the afterhours session after a rough month. is this bounce worth buying? we're following the story out of citigroup, the bank cutting the third quarter numbers. a shareholder to give us his reaction. take a look at that stock chart down 2% in the afterhours session. stay tuned. the most powerful app or managing your portfolio from the palm of your hand. only vectorvest mobile analyzes, ranks and graphs... ...over 16,000 stocks worldwide, everyday,... ...and gives you clear buy, sell, hold recommendations... ...on every stock; anytime, anywhere. vectorvest mobile comes free with your vectorvest trial.

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shares of go pro surging after a beat on the top and bottom lines. issuing no guidance, but calling the launch the most successful in company history. let's bring in michael pactor who initiated go pro recently with a buy rating on the stock. great to have you with us. looked like a good quarter, gross margins were good and the content published on youtube was up significantly year on year. >> yeah, all the social media metrics were up.

everything up amazingly. that's an indicator of how much head room this brand has for generating awareness among consumers. i think people thought of this as an outdoor athlete's brand and i think it's becoming a mainstream brand. and the youtube videos are proving to you this has a broad, broad addressable market. >> are you getting any color so far? i know the company called the launch the most successful in history. in terms of uptick, and if they're getting new customers to go pro as opposed to existing customers buying these things. >> you know, i'm certain that in the past quarter, it was more repeat customers, and in the current quarter, that's going to make this thing affordable. i bought my kids each one of these for christmas. they don't know that. i think they're at school right now. but, you know -- >> "fast money," actually, mike. "fast money." >> in class.

yeah, but for $129, that's almost a disposable gift. it's almost like buying a nintendo ds. i know my kids can handle that type of product. my daughters, they swim and surf, but really want this to go to football games and take videos of people in the stands. so i think it really is going to become a mainstream product you're going to see a lot of new purchaser this quarter. >> all right. let me ask you about the head room that you mentioned. because i think that's partly why the stock is valued where it is. it's that notion that it can actually turn into a media content. so when you see the metrics, the social media metrics rise, whatever it is between 80 and 100%. what are you thinking in terms of how they can monetize? start the process of turning itself into a media company? >> well, the immediate mon monetization comes through the lack of requirement they spend more money on marketing. i mean, ultimately, they may be able to monetize. i think they'll probably end up, you know, running contests for user generated content and taking the best of and putting

on the go pro channel monetized through advertising. but i don't think that's going to be a significant revenue source for the company for probably three or four years. i think the more immediate is just that they're getting free advertising from all these videos that get posted and from all the eyeballs that watch those videos. >> michael, the barriers to entry don't seem extremely large to me. >> agreed. >> since we see this youtube angle, could this be a tuck-in for google? isn't this a natural fit for google to just to take them out? is that something that shows up on your radar any place? >> yeah, you have google with google glass. and when you explain to me why they're in that business, that's why it's a natural fit. i mean, google never ceases to amaze me at the crazy things they're willing to try. sure, it is a fit. google was in talks with twitch. they're interested on youtube. not sure they want to be in the manufacturing business. this will be a manufacturing

company. but, sure, why not the go pro business. it makes just as much sense. >> tomorrow morning you say, buy on an 8% pop? >> yeah. i really like these guys. let's see what the guidance is. they're going to guide and guide to units. i think the number's going to be north of $500 million and that is a big number. i think the unit number's going to be north of 1.8 million. that's a big number, yes, i would buy on the pop. >> thank you. >> thank you, melissa. >> by the way, we should note in the afterhours session also seeing a pop. so where you don't like it because of valuation? i'm going to guess. >> it's 60 times 2015. interesting technology. it's one of these stocks where it's hard to argue. it doesn't mean as steve said the barriers to entry for anyone else doing this. there's a lot of stuff getting posted to social media that includes cameras off of people's iphones. to trade, i think the stock needs to trade down to a better multiple and i don't think the earnings are going to trade up

60 times. >> yeah. he said it's accessible. $129 camera, as well. i think flip camera. that's all i think about. >> and i think the media thing is ridiculous. well, why wouldn't we place a value on all the videos that people are uploading to youtube from iphones. >> that's what i mean. >> i went to see wilco last night. >> why didn't you? because your phone was in your pocket and you weren't wearing it around your chest? >> it wasn't strapped on and ready to go. >> i didn't see that. >> social media expert. shares of taser getting a boost on a product you wouldn't expect. coming up, a first on cnbc interview. rick smith who has himself been tased seven times. plus, we're following the story out of citigroup shares. still lower after the third quarter results. we'll get the reaction from the citigroup's shareholder coming up. from record-breaking highs to major market meltdowns.

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we went through the 10q filed at the top of this hour. and it appears that citigroup is making some more disclosures about exactly which agencies it is currently under investigation by. especially where related to foreign exchange potential manipulation or various activities the probe is looking into. among the agencies that are looking into this, melissa, the anti-trust division of the doj, the criminal division of the doj. the cftc here in the u.s., the financial conduct authority in the united kingdom as well as the swiss competition commission. so in all, it does appear there are five agencies cross border at that, this investigation appears to be where foreign

exchange matters are concerned, of course, we know that it's not just citigroup that is under the microscope over these issues. but it does appear that because citigroup is a global institution that they would be one of the top banks in the crosshairs regarding this issue. they also disclose another regulatory action that could be pending regarding some fixed interest rate swaps. the bank doesn't go into much detail on that front except to say that the doj and cftc are conducting investigations into that issue, the bank and the 10q, melissa, says it's fully cooperating. it does appear those are two of the biggest issues concerned by the $600 million charge associated with. >> kayla, thanks. just one question here. when i hear another pending investigation into fixed interest rate swaps, i think that could be another charge coming down the pike. >> it could be. but, melissa, what we don't know

is how big any of these settlements could potentially be. they could be very small, they could be very large. we did see some european regulators in the eu reach a settlement with a handful of banks over other matters, a couple of weeks ago, and that settlement across a handful of banks was only $120 million. when you consider the scale of these institutions, it really isn't something that becomes material for their bottom lines. it's unclear what share of the potential cost any of these issues will end up being. that being said, melissa, also remember the bank is currently being investigated for a fraud that took place at the mexico unit and that is expected to concern hundreds of millions of dollars in loans made by various units tied to fraud and that's another ongoing investigation. so what we don't know is how

expensive any one of these investigations may be, but there are, in fact, several issues that are being investigated. >> all right, kayla, thanks for that. kayla tausche with the latest on citi. we are watching the shares lower in the afterhours session on this news. down about 2% at this hour. now we know there are four agencies, one agency with two divisions as well as anti-trust. does the picture look worse now? >> i actually -- it does look a little worse to me. i think the fact that the doj criminal is involved. and i know there's been other criminal problems within this area or globally. but it concerns me a little bit. and then secondarily, is there a spillover? when i first heard this news. my thought was it's citi specific, that's all it has to be. i don't know the answer to this. but the markable question. is there a spillover to other banks? are there other investigations coming down the line? >> but we know there are. i would think that would be mitigating because everyone looks for citi to be once again this problem child with --

>> it's better because everybody else has the same problem? >> yeah, and i also think that doj and criminal elements. we'll track the developments. meantime, shares of taser getting shocked higher on earnings. the company beating on the top and the bottom lines after a huge surge in sales in the camera business. police forces around the country swapping out dash board cams, tasers, top of the line technology. lets bring in the founder. rick smith. great to see you again. >> it is great to be here on a day like today. >> i'm sure it is. >> you know, analysts across the board love your third quarter. beat on every metric across business segments, very strong. >> in particular, there's a surprising strength in video. because of the events that happened in ferguson over the summer. what are you seeing in terms of the uptick in inquiries in the uptick to adopt this for police

forces? >> yeah, we've seen dramatic increases across the board. the main thing is in my career, and i have the good, you know, the good fortune to start taser in a garage with some other folks and go through a big rise, you know, that technology got adopted, but i've never seen anything like in this where a single event or single moment in time shifted attitudes so dramatically. not only is the community going through turmoil, that officer is going through turmoil. it's my understanding there have been threats against his life. it's been terrific for everybody involved. and i think everyone wishes we knew what happened. >> so walk us through the ten-time increase in inquiries to the two times.

have you seen that translate into actual proposals. the point a lot of analysts wither making, this was a late third quarter event, we didn't see the impact in the third quarter. if there is an impact, it'll be in the fourth quarter and beyond. how should we think about this event and how it'll translate into revenues? >> yeah, i think you've got that just right. police departments don't whip out that credit card and buy the moment that -- it's not an impulse purchase market. so what you see here is really about the shift in attitude and acceptance. and i think we're going to be seeing the bigger effects six and nine months from now. that's typically the sales cycle for the agency to move through a trial, through a procurement, into, you know, full blown deployment. so we have yet to really see. >> and rick, i understand you have one of these cameras with you? >> i do. >> can you show it to us. give us an idea of what this looks like.

and while you're showing it to us. it's not just the sale of the camera, it's also the recurring revenue stream you have for managing what the camera takes in. >> so this is our flex camera, which is a wearable camera we partnered with oakley on the development on this. i'm wearing a pair of oakleys sunglasses. i've got the clear, tactical glasses. what an officer might wear at night to protect their eyes from body fluids and other stuff they run into while they're doing their job. and this is the battery module that goes with it. and i can throw this in a pocket somewhere. but really, yeah, the big differentiator is not the camera, the cameras are easy. the big differentiator is the cloud. this is a cloud connected wearable, connects over the internet to a service called evidence.com. and that's why we're winning. every one of the major cities that has made a camera selection in the past year has chosen us. and the reason is that, you know, for example, when one of the major agencies in missouri called us after ferguson, they

said we've got to get cameras out now. and we had 70 cameras live within a day of our team arriving on site. all we've got to do is plug into the internet and it's similar to the -- where the hardware and software plays together. they don't have to get into the business run data centers. >> all right. thank you so much for your time and thanks for showing us the camera, as well. rick smith, the ceo of taser international. up 9% on the day. this is not a hardware story anymore. >> no, it's not a hardware story. and i think you hit on it. you're going to be looking at these profits going forward. local governments are like a rusty wheel, right? you're going to see a lot of this income flow in, months to come, quarters to come. so i think it's great there. how much cooler is oakley partnering up with taser right there than the gopro camera? i'm not joking there. or google glass. >> we just had that gopro

conversation. we were all really skeptical. that's fascinating. when you talk about. when we don't buy into this social media app, this angle of uploading into the cloud, these products aren't connected. and they make sense. when you think of a company less than $1 billion market cap and has the potential growth, i think they were supposed to do $137 million in sales this year. this looks like an interesting story. >> i can't believe that guy's been tased seven times. seven times. >> yeah. >> big smile today. >> go-pro, linked in, all moving higher in the afterhours with the earnings underway. we'll get the latest after this break. we will talk to a former citigroup shareholder on what comes next. more "fast" straight ahead. growth is gratifying. goal is to grow. gotta get greater growth. i just talked to ups. they got expert advise, special discounts, new technologies. like smart pick ups. they'll only show up when you print a label and it's automatic. we save time and money.

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welcome back to "fast money." go pro shares are moving higher in a volatile trade in the after hours. the quarterly revenue jumped 46% for the wearable cameras. the earnings also came in better than what wall street was expecting. the stock got another boost as on the conference call, they raised their q4 guidance. they think q4 sales will be between $550 and $580 million.

also, the q4 earnings per share between 65 and 69 cents per share, that's better than the 54 cent per share analyst estimate. and also the founder and ceo talking about how they want to become more of a branded company and about content, not just their cameras. take a listen to what he said. >> progress related to the pillar of our business is best reflected by the sustained growth of viewership across the entire go pro network. on our youtube go pro channel alone, totaled $72 million. an increase of 99% year-over-year while total minutes viewed was up more than 130%. 133% year-over-year. >> now, this just goes to the idea that for the holiday season, they want that new camera to be big and branded and also that content to be front and center for a lot of their products, melissa. back over to you guys. >> thanks. still skeptical even though they raise fourth quarter guidance. this is a brand new publicly

traded company. that i they're going to be on the conservative side. they're not going to miss their first guidance. >> i think you buy it up 7%. >> you buy it up, 7%. >> this is a stock that traded almost $100 down to $65, a lot of shorts in the name. people waiting for these guys to drop -- i would not go near it up 700% in the afterhours. while brian may be right, it may be in the early stages, mel. this stock right now has had amazing negative energy against it. >> so 40% short interest, the stock off 34% recently. why would you rush into it? you're going to get -- always susceptible to have these short covering spikes in the name. i've been wrong on the name. never thought it would trade up into the 90s. but i just believe it's a barrier to entry question. >> but not yet. that's the thing, and more importantly, this is the only way. >> would you have sold it in the 90s? >> well, obviously, i would have

sold it right at the top and then the bottom. that's fair. >> i want to move on and check in on linkedin. julia boorstin has the latest on that. >> that's right. talk about significant progress and growth to 332 million members. 40% is now on mobile devices saying he's increasingly focused on developing countries in younger demographics. >> in q3, approximately 75% of new members came to linked in from outside the u.s. with china providing particular strength. china has quickly emerged as a large contributor in recent months. students remain another rapidly growing part of our network. >> now, china is the biggest contributor to new member growth after only the u.s. and in china, they're really focused on making sure they have the right local product in place. also laid out a couple of areas he wants to improve saying they want to better understand what members want to do with linkedn and they're going to continue to

build out the strategy with new mobile apps in the works. while they are raising prices, they don't expect them to impact turn after all. >> interesting to think of linkedin as a china play. >> there's a lot of online players getting the careers, jobs.com is another place. but it doesn't surprise me that people like the stock when they see the sales growth. i don't love the valuation, ebitda, somewhere 25 times more expensive than the peer group. but growing sales 1 1/2 times, that's interesting. >> let's get to the breaking news once again on citigroup. still falling in the afterhours session after cutting the third quarter results. the vice chairman of portfolio manager and aerial investments. he worked at citi for more than 20 years, is a former shareholder. charlie, great to have you with us. >> thanks for having me, melissa. >> would this be concerning to you? >> well, it's strange. it's strange you go back and adjust third quarter earnings for a new development with a regulatory agency.

normally you would take that charge now in the fourth quarter or tie it to which, the quarter it occurred, which isn't the current quarter. it's strange to go back and adjust. and if it is a previously disclosed issue, you have to think it's probably the foreign exchange trading issue. and people would be expecting that would be 100 to 300 million, now this is 600 million, it's a lot bigger. >> we still don't know, though, in terms of what the final tally is going to be that citigroup's going to have to pay potentially for this foreign exchange investigation. and there's another pending investigation outlined in that 10q. they're under investigation by four agencies, the doj has two divisions, antitrust and criminal investigating. does that -- is this another reason, another strike against citi in the view that city might not have its act together behind the scenes? >> well, yeah, the case and the reason we sold is that it's

unanalyzable, if that's a word. you can't put your finger on what these numbers are and they don't seem to stop. and you think you've seen the last big settlement and they keep coming after them. we had, and many people thought they had seen the big numbers and they keep coming. >> charles, it's tim. talk about settlement. this is a case where clearly the dogs are rapibid, there's a lotf reasons why it would be poster child. and if you can comment on the rest of the sector then. because it seems to me is a sense this is largely in the rearview mirror. sounds like you're not sure about that citibank. how about across the sector? >> yeah, we own goldman and morgan because we think they're not quite in the same crosshairs of the regulators. it is the big, big banks that seem to have more problems internationally. and then, there is just the problem that citi is so big and so difficult to manage. something keeps cropping up in mexico. something crops up in poland, in korea or japan.

and the names that we own just seem like you can get your arms around them better. >> all right. charles. we're going to leave it there. we appreciate it. are you thinking again about citi versus -- >> well, look, charles knows the company very well. one of the reasons i like citibank is i think there is a lot of operational upside where i do think they have a lot more earnings growth potential than some of the guys that are anchored to this economy. and they have the interest rate factor and the interest rate sensitivity. >> so the 2% decline in the afterhours session? are you inclined to buy? >> i'm inclined to wait. i have a good-sized position. and i do think, though, that when we've seen the stock sell off on these headlines because people like to go after citi, it's been a time to buy. look at that. >> all right. it is a post qe world and we're living in it. our next guest says you should stay short. they're still after me. get to the terminal across town.

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alexandra laventhal. great to see you. there really wasn't too much of a reaction in the muni bond world when the fed officially ended qe. how are you looking at muni bonds in the post qe world? >> so, you know, i think the key is that the fed said we're going to keep interest rates at zero for some time. so, obviously, we're not expecting interest rates to rise for some time and that applies to municipals. but people still don't know exactly when that's going to happen and people need to be defensive. so what we've been doing for some time is keeping people short in their portfolios. short duration, short maturities, so that's -- that's continuing to be the strategy. >> okay. and just to be clear for our viewers at home, short doesn't mean you're selling, short means -- >> it's a good point. a lot of people watching. in fact -- you cannot short municipa municipals. a lot of people may not know that because you'd never be able to cover your short. short maturities. >> good. >> and in terms of when things pick up. you make the point that november is potentially a great time

because there's a lot of activity in the market. >> so, municipals are generally going to cover -- follow treasury bonds just like corporate bonds will. except for the fact that they are very dependent on supply and demand and there's certain times when there's a lot of supply and certain times when there's less. so you have buyers that come into the market and snap it up and yields will rise and fall at different rates than treasuries. so there has not been a lot of supply recently. right now -- it could be a buying opportunity then. >> so let's talk about the one negative that's out there, which is puerto rico. where do we stand in that. >> so people should only worry about puerto rico in terms of whether they have it in their portfolio, having existing puerto ricos or in their mutual funds.

and that's the big issue because puerto rico's exempt in every state of the country and so it's always been used as a, you know, sort of filler. when there wasn't other paper. puerto rico continues to be an issue, it's not systematic in terms of credit problems for the rest of the industry. that's the important thing that a lot of people don't realize for municipal bonds. whether it's puerto rico or detroit, each situation is individual unto itself. >> thanks for coming by. appreciate it. all right. do you have muni bonds? >> i don't. i don't. but i did ask about puerto rico. there is a hedge fund trade where they're buying puerto rico bonds. >> sure. >> on the idea that they will never be allowed to default so you get a higher yield. so that's why i wanted to ask about. the hedge funds had a different risk tolerance, clearly, than an individual. >> shares of big pharma, bristol-myers taking off in today's session after positive results. will the rally be short lived. we break that down in a special edition of "options action" after this break.

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to a 13-year high after reporting positive trial data on

the lung cancer drug. but the move had some traders looking for protection. dan's got today's action. >> huge volume day in the stock, also in the options. average daily volume with calls outnumbering puts, 2-1. there was one trade that caught my eye. it was actually the largest options trade in the name where a trader bought 7,500 of the november 55 puts for 49 cents. they also bought 150,000 shares of stock. but i suspect they actually traded out of that and they really wanted the puts as protection against long stock position. when you look at the stock here, mel said, the stock broke out to 13-year highs. this is a two-year chart right here. it's a beautiful technical set-up. here's the long-term, this is the 20-year. it's hitting levels it hasn't seen since the bubble in the late '90s. and the one thing about puts here. this is the price of options, they got a little cheaper. maybe this trader is basically saying there's probably going to be the full data coming out in the next week or so, i'm looking to protect the gains i have

right here. >> would you be in this trade, dan? where do you stand, the dividend yields at 2.4%. >> the stock is underperforming a lot of its peers, it's only up 10% on the year. there's no sales in earnings growth, they've not been growing over the last couple of years, that's why the drug trials for a lung cancer drug are so important. when you own a company like this that you think is defensive, they need big hits on these drugs. this trader's thinking i have this trade on for this. i'm going to buy some protection, i have my downside covered. >> academic out our live show 5:30 p.m. eastern time tomorrow. the race is on for the cure for ebola and in the lab where one of the treatments was tested. >> and things like ebola where we did some work on techmara, we did the safety work in animals to make sure that drug was safe. one of the patients that's been in the public press got the drug and is fine as a result of that.

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take a quick earnings alert here on microchip technology. this is a chip company that dragged the whole sector down. shares are higher in the afterhours session. company earnings were in line with expectations. microchip is still down from when -- but the rest of the sector has basically come back. >> and today, the whole sector was under pressure. samsung made some comments on dram prices which tim mentioned on the call should have been positive. >> there was also intersol came out. a miss on the third quarter, revenue for the fourth quarter was light and also said that its computing market share would fall by 20% or 25%. >> and there's always that supply and demand issue with dram. the whole space was under pressure. intel was under pressure, it's a number one component of smh of the semiconductor market vectors. if you look at this group. it's been under pressure. they all bounce back going into the end of the day. >> you have to really consider

that momentum's waning here. micron, intel, these would be huge success stories. they underperform 90% of the entire tech sector. they have not gotten back to the previous highs. and i'm actually long puts intel. >> all right. time now for the final trade. let's go around the horn. tim seymour. >> the way i see it, if you don't own citi, you definitely are buying a stock that gives you an opportunity. this was trading at two times price -- you'd run away from the stock. this is a stock with great support at 49. >> you don't have to buy it right now. >> we're not debating. >> dan, you're turn. your turn. >> linkedin, i'm looking to sell it tomorrow morning as a trade. >> the sales growth is great. >> spicy final trade. brian kelly? >> i'll go to you the post qe and that's buy bonds. it's going to sound a little weird. but, if you have people coming in and buying the u.s. dollar, where are they going to park

those dollars? in bonds. you buy tlt. >> looks like it made a near term bottom, 42 1/2, i'm long the name, $50. >> thanks so much for watching. see you tomorrow here at 5:00 for more my mission is simple. to make you money. i'm here to level the playing field for all investors. there's always a bull market somewhere, and promise to help you find it. "mad money" starts now. hey, i'm cramer. welcome to "mad money." welcome to cramerica. other people want to make friends. i'm trying to make you money. my job is to put it in contest, to teach you and coach you. so call me, or tweet me @jimcramer. apologies, please. for thousands of points, countless