stress test your own portfolio. we spent a lot of time art the banks and what to look. for investors need to look at how much risk they can take, what happens to their unemployment? housing prices going down. if that happens, how are you prepared? >> if you need a break, there's always a circus. that does it for us on "closing bell." "fast money" begins right now. live from the nasdaq market site overlooking a very show we times square in new york city, i'm melissa lee. this is "fast money." traders tonight, tim seymour, brian kelly, karen, and guy adami. soaring 15% on strong guidance and plans for yieldco. we have the cfo in an exclusive. plus tech bubble 2.0. mark cuban making comments on liquidity in the market. comments you need to hear and the trade ahead. first breaking news on the latest round of the u.s. bank stress test. kayla has more back at hours. kayla? >> reporter: hey, nellis is a. for the first time sense the stress tests were introduced by the federal reserve in 2009, all

banks that are undergoing the test in this year, 31 global banks representing 8 0% of banking assets, actually were found to have enough capital on hand to weather a depression-like environment without needing money from taxpayers. that, of course, is what these tests serve to find out. this scenario this year, the most intense stress scenario saw unemployment at 10%. brent at $110. dow below 1,000. usd/euro at 1.21. the introduction of a new event, new hypothetical event whereby corporate debt defaults at a much higher rate than currently expected. of course, the default rate is normally fairly low, but if that default rate were to go up, you would see spreads widen, volatility go up and see a follow-on effect in the equity markets. in that suspect, you saw an

effect on the big banks. see looking right there, tier one common equity at goldman sachs 5.8%. jpmorgan chase 6.3%. while bank of america looks best in class there by 7.1%. using all of those tests. that blue line that you're looking at, though, is the federal reserve's 4.5% minimum for tier one common equity ratio. even though we can compare them against each other, they are still far above that with a pretty comfortable margin. now, the question remains, melissa, next wednesday, how big will that margin be? the banks have also submitted their potential capital plans, the buybacks, the dividends they would like to offer to their shareholders in many cases increases over last year, increasing that payout ratio of their earnings, but those capital levels will determine how much of those earnings they'll be able to pay out, whether the fed finds their capital planning processes are sufficient. that, of course, was what got

citigroup in trouble last year when the fed found some qualitative issues with the plan even though the capital on the whole met its muster. so we remain to see what actually happens next week, what the banks are able to give back. at least on a quantitativive level, fell limelissa, all bank undergoing them have had capital. >> thank you very much. the initial hurdle all clear. bank of america in the after-hours session probably on low volume but is trading higher, gains we saw in the regular session of trade. karen finerman, what was your reaction here? >> i just find the test, itself, to be so absurd. >> yeah. >> the idea, all of these different things happening, 10% unemployment, $110 brent with a gdp of, what, negative 6? those two things seem highly unlikely. i find this test kind of ridiculous. we will look back on this and say, this is just absolutely absurd. c-car, however, is important. >> we'll find out exactly what

the banks can, in fact, do. exactly. >> if anything, today i's announcement, next week is all about citibank. they've divested one main -- i think they have the most to gain by this. this is the one i'm long. also long bank of america. >> for more, fbr capital markets manager paul miller. he joins us on the fast line. good to have you with us. i guess no surprises here. what are you expecting come the 11th? >> you know, i will say i agree with you guys that i think these are absurd tests. they're just out there to give people faith in the banking system. if we get into big crisis again, these guys will be struggling again and i think it's just a game the fed is playing. you know, what this doesn't test is processing. that's what citi failed on last year. you know, citi should hopefully pass this year on that. the process that the quantity thatti quantitative levels aren't measured here.

next week's test, the ccar test which makes it a little more hairy. bank of america, i think they're going to do fine through this test. that's one of the names we really like here. next week is a little, little more important because it deals with the capital return investors really care about these names. >> you really like bank of america. what do you expect from them on the capital return front next week? >> right now they're paying a decent dividend. turn 50%, 70% of their earnings back to shareholders. i don't know if they're there yet. hopefully they get there. some banks like jp morgan has returned 100% of their earnings back on both buybacks and dividends. "b" of "a" is probably not there yet but they're heading in that direction. >> zion's bank corp named 2012/'13 great story. 2014 was trying and got off to a bad start this year. that looks like a stock that might have leverage here. what do you think about z-i-o-n?

>> this is preliminary because we get the data as soon as you are. they came out weaker than anybody else but failed last year. at least they didn't fail this year. they have a little more complicated balance sheet. they've been on the sidelines a little bit with reference to lending. they don't want to really grow in this environment. so we're still on the sidelines here. it might be, you know, when you really think about it, five years down the road, they might be taking the best position, not lending in this environment. but right now, we're on the sidelines on zions because they'regrowing. >> underperformer versus its peers, paul. is this the catch-up trade once it clears the 11th? >> i think so. there's a lot of confusion on their q they put out on exiting some of the different stress test scenarios. maybe they can start catching up here. we believe "b" of "a" has the most upside for the simple fact they're behind everybody else in cleaning out their nonperformers or bad performing loans and got $2 billion of call saves. now, you know, are they going to

get that next week? no. over the next year? probably not. we believe that once they start to show people they can earn $1.80, $2 per year, this could be north of 20 bucks. >> all right. paul, great to have you with us. paul miller. fbr. brian kelly, what's your trade? >> i tell you, i mean, of all of them, bank of america is the one that looks most attractive only because it hasn't run as much as the other banks. a lot of these banks have had a tremendous run coming into this. if anything, it's a trade. what my biggest concern is, and it comes back to the bond market, are we going to get a flat yield curve which i am betting on? this is the battleground. we're very close to this flipping where you could get a steep yield curve. we'll see tomorrow with the unemployment report. >> people make a big zedeal outf the capital return. expecting a slight improve. it depends on who you ask. i bet the hedge fund compares about it. you're not going to get a big dividend out of citi but might

get the ability to have them buy back more stock which is a much bigger driver for the shares. >> what scenario would you stress test is. >> it's never the bus you see coming. that's karen's point. >> the $110 brent seems ridiculous at this point. >> what about $25 brent? >> exactly. >> some event that nobody can think of is going to derail everything. i get whey they do it. karen makes a fair point. >> in terms of the -- >> u.s. bank corp, they came through this with flying colors again. a stock that pays a 2.5% dividend. probably trades at a premium. they deserve it because they've been the most conservative along the way, usb. >> at this point, i have the most money in bac. i agree with timmy, i'd much rather see a buyback. money and dividenddividends, th out the door. long onlies want that. bac may be on the verge of looking through the credit quality problems.

litigation, from last year and hopefully on to a clear path to earnings. now to the move in the euro, fauldi i falling below $1.10 since 2002. mario draghi says the ecb plans to start its asset purchase program on march 9th. our friends crunched the numbers. what we found. when the iuoryea euro trades be and $1.10, the dax trades. average return, .12%. no too much. get this. the nasdaq trades positive 73% of the time with an average return of more than 7%. >> what does that mean? because, i mean, you know, when the euro traded -- first of all, the euro hasn't been this low in 11 1/2 years. from $1 to $1.10, where are we? this is a big currency move.

sorry. i'm not a big -- >> the history of the euro is very short. so the number of times this has happened obviously is also few and far between. >> you can't -- i mean, the thing about currencies is the relative value indexes and they tell you where the flows are going one we or the other. flows can be going for different reasons. right now, we're getting flows into the u.s. because people want the yield on the treasury bonds. but that can flip tomorrow and you can still have a strong dollar. so, i would not trade off of this information at all. i think it's one of two down points. >> so we're going to poopoo the data. the euro is still at $is 1.10. what's the trade then? >> 1-1. >> it almost has to at this point. can't you see the headline? you don't envision a night where we have the banner -- >> it's a nice banner to have. first of all, $1.08 is strong support on the euro. look at european earnings. started the quarter to be very interesting. ecb upgraded gdp growth from 1

to 1 1/2 this year. i think both the numbers are low. the euro will strengthen because fundamentals in macrodata -- >> is the trade in the dax over? >> if the euro strengthens, yes, that will weaken the dax without a doubt. yes, they upgraded the economic data, but i mean, they don't have a great track record of predicting what the economy is going to do in europe. nobody does. i think the yeeuro gets weaker. >> what does it mean to german yields if the -- >> what does that mean to the stock market here? to the u.s.? >> one would think. >> we'll see. >> okay. still ahead, what's wrong with apple? the stock seeing a major move lower today. a look at what's behind the slide and if you should be taking profits before monday's watch is unveiled. a $21 billion cancer drug deal.

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i moved our old security whsystem out here? to see if it could monitor the front yard. why don't you switch to xfinity home? i get live video monitoring and 24/7 professional monitoring that i can arm and disarm from anywhere. hear ye! the awkward teenage one has arrived!!!! don't be old fashioned. xfinity customers add xfinity home for $29.95 a month for 12 months. plus for a limited time, get a free security camera call 1800 xfinity or visit comcast.com/xfinityhome. take a look at that decline in shares of the gap down 2% in the after-hour session. morgan brennan in the newsroom

with the story behind this move. hey, morgan. >> shares of gap sliding in the after-hours trade. the retail releasing february comp store sales numbers coming in down 4%. meanwhile, the street was looking for sales to be up 2%. so big miss there. old navy, owned by gap, saw flat comp store sales, the relative bright spot. banana republic, gap brands both negative. the stock is down 2% in the after hours. back over to you. >> thank you, morgan. karen, you're an own eer of the gap. >> i'm owner of gap calls which will likely go to zero. this is disappointing. they're in a turnaround. they have a new ceo. tease numb these numbers are yuck. >> nothing about them. do you think it's the weather? >> they're too yucky for just the weather. >> too yucky? is that a financial -- >> she used yuck first. >> not just yuck overall. >> i don't think you -- october we saw it flush down to 36 bucks. i don't necessarily think it's getting down there. if it holds 40 which is where it

held a couple weeks ago, i think you'd buy it for a trade. all right. costco getting a bump. sales in the second quarter rose 4%. kicking off our top trade today. shares up 3%. earlier this week costco said citigroup and visa would replace american express as its credit card partners. karen? >> i mean, this is such a great company i happen to own for 100 maybe. they seem to do everything right. gas for them is really a nice boost for them. and, but on every part of their business, they do such a great job. it ain't cheap here, though. >> right. >> but they do continue to outperform. i don't know. just going to continue to not be a holder and be bitter about it i think for quite some time. >> right. february, i'm sure we're going to hear when it comes to the next earnings season about february being a terrible month because of all this snow. like, we're seeing today here in the northeast. >> although it's march. >> but -- oh, yes. but in february as well there was snow. correct? >> yeah, sure. >> february shares were up 8%. february same-store sales were up 8%. >> target has done really well.

slow and steady wins the race with costco. definitely a stock we talked about before. karen is right. it is expensive. the stock feels like it wants to continue to grind higher from here. >> yeah. you're in a place where these are stocks that are becoming consensus places to go if the valuation makes sern s sense, p are uncertain about the economy. >> make sense in your view? >> yeah, i like it. >> how about you? >> there's a catalyst coming up for the next quarter. it's falling meat prices and meat and agriculture prices have come down. that's going to expand their margins in that particular area. so, as long as they continue to fire on all the cylinders they're firing on, there is a catalyst out there. >> next up, joy global getting hit. the second worst performer on the s&p 500 today. the company missing earnings and revenue estimates, plus lowered its 2015 guidance. tim? >> the first quarter, not a surprise they're off to a slow start. comes on the same day china downgrades gdp growth. to me, a mining equipment

company that tells you they have bad numbers and missed badly on earnings and see an extension up the trough to me is not a reason to smell miners. look at freeport, tech resources, look at bhp, these are stocks up 10%, 5% to 8% over the last month. that's a reason to buy miners. who cares about the mining equipment companies. i think people overreacted to the numbers. >> i think it terms of the metals out there, i'm short copper. that's still one you want to be short in this environment. if you're talking -- i agree with tim, if you don't want to necessarily be short them, the miners because joy global did bad, but if you're looking at the equipment manufacturers, i'll take it back to agriculture and look at john deere. agriculture tends to be cyclical. we're coming to a bottom in it. with all the snow we're having here, remember ha happppens whe melts, the fields have to be relr replowed. >> caterpillar did bounce. how many times did it continue to do that?

did it the back end of 2012, all of 2013 and a couple times last year. i'm not certain it's going to do it this time. so you want to trade it, trade it against 80 bucks. through 80 bucks you have a huge swath to the downsize. >> next up, apple falling nearly 2%. since reports surfaced it will push production of its new larger ipad to the second half of the year. suppliers were originally told to be ready to start production the first calendar quarter of this year. tablet sales continue to decline down 18% in the most recent quarter. supposed to be a 12.9 inch ipad. >> can't wait. gives people an excuse to sell ahead of the march 9th event on monday. if you're looking for an excuse, needed a reason to take profits maybe that provided you with onone r one, maybe they have to say something outrageously good on monday. all i know is this, tim can speak to this, as can karen, every dip in the stock the last year and a half, two years has been a huge buying opportunity. i don't see that's going to change any time soon. >> it does seem weird, most people don't think the larger ipad is going to be much of an

impact, therefore why would it sell off 2% in response to a delayed larger ipad? >> driving the momentum here, so the lack of it or delay of it rather i don't think should be a reversal on it. this stock is so subject to sentiment, probably more than anything except maybe a tesla that i agree, could be, you know, buy the rumor, sell the news ahead of the watch release. >> i think it's scary high. and i've been long apple for a long time. i'm very happy about that. i am getting ready to pick my spots to take profits and i'm going to come back. coming up next, the race for big pharma and cancer drugs. which stocks might be right for a takeover? later, mark cuban sounding alarm on tech bubble 2.0. we've got the details ahead.

earnings alert on the fresh market. morgan brennan has the details. morgan? >> melissa, the fresh market moving higher in after hours trading. earnings that beat consensus analyst estimates. revenue in below expectations. fresh market announcing it will shudder operations in california to focus on other higher growth opportunities. that's sending shares of the stock up about 3% right now in after hours. back over to you. >> thank you, morgan. i would think that california would be a great business -- >> it's a fresh state. it's got the fresh prince of bel-air, too, for that matter. anyway, if you look at the stock, though, what's interesting the reaction in the posterin post earnings is the stock was trapped between $37 and $41. growing margins when the company has been making investments and that's what the street looks

like. >> whole foods or hane? >> hane. inwin has been on the show a dozen times. every time he's on, we have to stay, buy the stock. continues to make-talk highs. if you play the game with me, hane. biotech segment, shock therapy. shares of bristol-myers, the company won expanded awe approval of its lung cancer drug before approval. >> that's right. this happened yesterday and shocks everyone. analysts are calling this a record turnaround time for an approval. as you mentioned, more than three months ahead of schedule. this after a study of this drug was stopped early in january because it showed a survival benefit in lung cancer. this has positive implications not only for bristol-myers but competitors including merck and roche. i was talking with alex arpa, he said the entire imm nurks o

market. part of the reason for that, there's a large medical need in lung cancer. it's the second most common cancer in the u.s. and the first, it's the leading cause of cancer-related deaths. so it's a huge, huge problem. this is huge news for bristol-myers. what he was also saying is it gets this big lead over merck and roche potentially. merck and roche close on the heels and could get potentially broader or different approvals. it's interesting to see how that works out. another implication to this, we're continually seeing drugs get approved early at the fda. of course that's good news for the entire industry. wells fargo actually saying that there's a potential for vertex, a cystic fibrosis combo. both of these immunotherapy

drugs are aproproved early. this a record early approval for lung cancer. vertex, a cystic fibrosis drug was approved early, kalydeco. looking at the overall trend and looking forward to whether we may see more early approvals, melissa. >> let's pivot, meagan. i think what most people were puzzled about if they were puzzled about this deal at all is the 39% premium on the deal. what does this do for the other potential targets? >> yeah, you make the perfect point, so the questions here today was why is abvie paying so much for half the drug? paying $21 billion. you're seeing abbvie under pressure, of course, great news for the biotech industry. everyone saying this could lift valuations for all potential targets. we thought it would be a good time to look forward to see what are the potential targets? i reached out to half a dozen analysts and got top picks. three names multiple people cited.

metavasion, vertex. a cancer company. little less than $10 billion market cap. sells a prostate cancer drug which rbc thinks could grow to $6 billion in peak annual revenue over time. so, that could get a lot bigger. potential acquirers are johnson & johnson. j & j was a rumored bidder. some saying this is a competitive process. there are other potential buyers out there with money and with appetite. looking at vertech which has a cystic fibrosis franchise. peak annual sales could be up to $6 billion. potential acquirers there, super interesting, j & j again but also gilliad. everyone is wondering what they're doing with the money it's bringing in from its hepatitis c franchises. most people think it's a potential look at this company.

the last one is biomarin. >> thank you very much for that. guy adami? >> bristol-myers. bristol trades 30 time forward earnings, twice as much as pfizer does. make an argument maybe they're deserved of it. many people anticipated a fast release, faster than it thought the fda would react. that's fine. you're getting into the deep end of the pool in bmy. a lot of analysts have 70 as their price target. breaking news on a train derailment in illinois. morgan brennan has got the details. morgan? >> melissa, a bnsf train has derailed in illinois specifically galena, illinois. this train was carrying crude oil. just to give you some context here, galena, illinois, is just outside of dubuque, iowa, and three-hour drive from chicago. this is a 105-car train. 103 of those cars were filled with crude oil. see there the smoke coming from

this train. local reports saying the train is on fire. bnsf putting out a statement just a short while ago, says the train derailed at approximately 1:20 central time. says there are no injuries and that respondents are en route. again, a bnsf train carrying crude oil has derailed in gal a galena, illinois. checking shares of berkshire hathaway since they share bnsf, perhaps unsurprisingly stock not moving on this news. again, a train has derailed, another train carrying crude oil. >> morgan, thank you. still ahead, it's all the rage in the solar seconder. the latest on canadian solar, sent the stock soaring 15% in today's session. we're sitting down with the cfo later on. stay tuned. around the world, to actively uncover, discuss and debate investment opportunities. which leads to better decisions for our clients. it's a uniquely collaborative approach

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still ahead on "fast money" mark cuban sounding the alarm on the tech bubble. plus, canadian solar soaring 15% on strong guidance, and plans for a yield co. we'll hear from the company's cfo in an exclusive. later the under the radar commodity play that could see big gains this year. first, billionaire investor mark cuban warning investors

there's a tech bubble and bigger than the one 15 years ago. cuban said the private market could be on the verge of big losses. he made those comments on "the closing bell" today. >> how many times a week, kelly, are you hit with a -- it happens all the time. that's today's equivalent. the problem with all these people, and there's no liquidity. most of them have no chance of getting their money back, but they think it's a smart investment because it could be the next twitter. >> ironically, he's got his own app, but anyway. joining us to discuss tech bubble fears and more, mark mahaney, one of the top internet analysts in the industry. mark, always great to have you with us. >> hey, melissa. >> in terms of the bubble, you don't think there is one, as many people don't. the reasons are pretty common in terms of why there is no bubble. the business models are proven. the valuations are plumuch more provable. the end markets are much bigger

this time around. >> well, that's true. i mean, some of us lived through that, and, you know, for the good and the bad lived through the tech bubble. mark cuban certainly did. i did as well. that was a time when internet advertising markets, for example, in 2000, the estimate was about $10 billion end market. today we're almost ten times that, at least in the u.s. and 15 times that globally. so the markets have proven out. i think you were talking about a bubble in the private markets and illiquidity in the markets. there are valid points there. look at the leading internet advertising retail and travel names. they traded 18, 19, 20 times earnings. that's google, that's ebay, priceline. kind of hard to call that a bubble. i'm sure there's speculation in the market. we try to call it from time to time. as a group, we don't see it. >> why do you think there could be -- it sounds like you agree with him in terms of the bubble in the private market. why you do you think this could be an isolated bubble and doesn't trickle into the

valuations of private tech companies? >> well, it could. there's no evidence yet that it's trickled into the valuations of public companies. what we are seeing, and something that's very different than what we experienced 15 years ago is companies are waiting much longer to come out. so business models are, you know, alibaba when it comes out, facebook, when it comes out are much more proven than some of the businesses we saw way back then including mark's old business, broadcast.com. there are companies that are coming out with very high profitability levels. so, again, in the public markets we're not seeing the -- could there be in the private markets? possibly. it's really hard to know. it's a great statement to make but look at the pnls before you make those comments. he may have that kind of view. we don't so we're not making ei that comment. >> amazon up 25% already. you stick with this trade? >> yeah, we do. you know, it looks like it's up a lot year to date over the last 12 months. this thing has done nothing but round tripped. i mean, we're at 380 roughly 12

months ago. we have an inflection point in gross margins in the december quarter. we think there's still an inflection point coming up in fulfillment expenses and overall revenue growth. if we're right about that, the stock goes higher. >> hey, mark, it's tim. on priceline, another one of your picks. they're glrowing globally. talk about china, their partnership. the two main intra-asian hotel bookings. it's a huge area of growth. >> two things we really focus on that are the new new things when it comes to china, i'm sorry, when it comes to priceline. first the vacation rental market they're tapping into. secondly, the china outbound market. we're close to the point, the largest outbound market, traveling overseas, no longer germany, the u.s., it's china, not surprisingly. priceline has very well sistuatd itself. through a strategic investment in ctrip. it's tiny for priceline to date.

over the next three, five years it's a nice new revenue driver. >> mark, great to speak with you. >> thanks, melissa. >> the most important thing, the last time around there was obviously clearly a bubble. there was to value anywhere to be had. at all. in any, any company. now it's very different. if we look at something like a cisco which is a real value play, that time it was $448 billion valuation on $2 billion or $3 billion of earnings. now it's $150 billion on $9 billion of earnings. it's a completely, completely different metric. >> amazon is interesting. he's right. it round tripped. beginning of 20 14, trading 400. obviously a huge move lower. bounced back. do you buy amazon here? i don't think so. you're more inclined, buy it on a breakout if it happens above 400. >> one of the problems mark cuban actually talked about is having no liquidity in the private market but there's a company out there providing that liquid

liquidity. that's nasdaq. the landlord right here. >> liquidity, that's relative. relative to a publicly traded -- >> right, it's net goiot going anything. >> if you want out today, you might not be able to get out. >> mark cuban has an excellent point in that, if it goes bad, there's going to be zero liqu liquidity. no matter what kind of market you have. it's going to go to zero. pops and drops. big movers of the day. pop for dunkin' donuts up 3%. >> refreshed guidance. they're going to meet their full-year numbers. they've been outperforming of late. i go back to starbucks. much better play. >> drop for weight watchers down 4%. >> weight watchers, make so many jokes about weight watchers slipping down this year. >> you would never do that. >> because they're awful. >> the stock is cheaper. there's a boat load of debt on this one. i'd be afraid. >> pop for mobileeye up 6%.

>> you were surprised yesterday. it's big for you. i get it. this stock since october, lower highs, lower lows. the pattern continues. buy it on a break above 40. don't think it's going to happen. >> drop for caesars. >> this is coming out of bruc s bankruptcy. if you know the details of it, it's fine. >> goldman sachs claiming liquified natural gas is poised to be the second most valuable global commodity this year. the global trade will exceed $120 billion, surpassing iron ore to take second place behind oil. take a look at a company that liquifies and ships natural gas surging after announcing a possible deal with russian oil company rosneft. >> i am in glng. this is a great management team. they have a bunch of assets that ship lng. liquified natural gas. they have potential big calls,

flng, liquefaction which takes natural liquifiies to be transported and later regasified. it's not io a fully done deal y. wow, there are these big projects, calls that could be very valuable that we're trading for zero as oil got crushed. that now you can see there is some potential value there and they have four or five of them. so the rest of the fleet is probably worth 30 ish bucks a share. you're not paying a lot for future calls. i really like it. it's interesting. it will trade with oil in short term but not the long term. >> it is massive. the russians have so much lng they're trying to get to other parts of the world. there are a lot of reasons in the short term why i don't think that happens. i'm confused why lng is the trade while nat gas and others in the entire spectrum are

trading so cheap. you -- the infrastructure in this country is not there. >> u.s. lfg is totally different than where it's prized in asia, for example. it's a completely different market. >> okay. >> well, i think glng is the only way to play this, exactly what karen talked about. you're not necessarily talking about a natural gas trade here but a different way of transporting the commodity. it has been a local market, it is a local market. this could change that. >> one last point. it's not the price of natural gas. it's how much gets transported. >> right. similar to a tanker. we talk about that a lot. coming up, canadian solar stock taking off. boosting guidance revealing new details of a special spinoff. we talk to the cfo in a cnbc exclusive right after this break. ♪ building aircraft, the likes of which the world has never seen.

this is what we do. ♪ that's the value of performance. northrop grumman.

shares of canadian solar jumping 15% after better than expected guidance for the first quarter. companies saying in its earnings release it's planning to form a yield co in order to maximize shareholder value. joining us on the fast line is canadian solar cfo michael potter. thanks for phoning in from china. we appreciate you getting up early. michael, are you there? we seem to be having some

problems hearing michael. so, we'll get that straightened out. in the meantime, let's get to an earnings report. morgan brennan has details. >> soaring, up about 5% in the after hours trade. that comes after the company released third quarter earnings and revenues that were both in line with expectations. the company also issued better than expected guidance for the current quarter, again, those shares up 5%. back over to you. >> all right. thank you very much, morgan brennan. tim? >> bring us back to canadian solar, i'm sorry. well, finisar. >> you don't trade that one. >> not really. sorry. i have a lot to say on canadian solar. >> it's the guidance on this. the earnings came in line. the guidance that's important. one of those optical plays, again. the chart actually doesn't look that bad. it's been in a nice uptrend. i think in this karcase, it's n at the year high. it's a rare find in this market. >> all right. we have the issues worked out. michael potter, cfo of canadian

solar joins us on the fast line. michael, are you there? >> hi, melissa, thanks for having me on your show. >> thanks a lot for phoning in from china. we appreciate it. investors are most excited about the yieldco and the transition that's taking place at the company away from the simple field and sell model. part of that is the acquisition of recurrent energy will give you more assets to push down into the yieldco. talk to us about the mix of assets you plan to have in that yieldco? a wide portfolio geographically and in terms of different projects. >> yeah, we're still working on lining up all the asset that we would use for it, but essentially would use our very high quality countries such as japan and the uk. obviously the united states via the recurrent acquisition. and perhaps some canadian projects as well. >> why not china? i know in the conference call there was some discussion about evaluating the best assets or the best options, i should say, in china. what's going on with those assets? the quality of the assets? what does that do to the balance

sheet if you keep those assets there as opposed to putting it into another vehicle? >> it's not a question of whether we do some form of securitization for the chinese assets. it's more of a question of where. we're concerned that the assets inside china are not well understood yet in the u.s. market, and the valuation that we would get for those assets would not be as good as if we listed in an asian market such as hong kong or china. >> talk to us also about the timing of this yieldco. plenty other company have either announced plans like first solar and sunpower with a joint yieldco or one that is coming that will have emerging market assets. is there a sense that the time is now to capture this investor attention and is that a factor in deciding what assets go into the yieldco that will come to market from canadian solar? >> yeah, i think that the market has realized that solar projects are quite valuable assets.

they provide predictable and very good returns into the future. yieldco is simply a method of lowering your cost capital. so you can be competitive with who are natural customers to date that are buying the projects. so we would hope to do this as soon as practical, and that would will likely somewhere near the end of this year or early next year. there's various regulatory filings and paperwork you need to do. and we need to get approval and that process usually takes some time. >> in forming the yieldco, deciding what kind of yield you'll offer on it, does it factor in the fact there are other yieldcos that are either coming on to market or are currently on the market? >> yeah, i think an advantage we have is we're very well known large international developer. one main factor in the yield, the yieldco offers is its ability to provide growth into the future and the certainty of that growth, and we believe

canadian solar is a world leader in solar project development and investors in the yieldco we're sponsoring will have a lot of confidence we can grow in the future. >> mr. potter, it's karen. will you retain incentive distribution rates? have you figured out the structure yet? >> i don't know if we'll do it for sure, but it's likely that we would. it's a very good feature that aligns the interest of the yieldco shareholders with the sponsoring parent company. essentially encourages us to grow the cash flow available to the shareholders quickly and to keep through with the expectations we'll drop assets in because it benefits the parent and shareholders. >> michael, we have to leave it there. thank you so much for phoning in. we do appreciate it. michael potter. cfo of canadian solar. huge pop on the back of the news it's going to come to market with a yieldco probably at the end of the year. >> they also came out with numbers today which also -- they're going to deliver supply which is much better than

expected. the transition of the company, transformation from build and flip to own and operate is very important. one of the things they need to explain and have done a good job, but the near-term revenues may be lower, but this is a much more consistent long-term predictable cash flow business than investors love. >> this quarter cps wasn't great. revenue was very good. margins excellent. $1 billion of cash equivalence on the balance sheet. you have to think with the short interests this stock continues to move higher given that news. >> we said it a few times but they're starting to decouple from oil. >> yeah. >> huge in solar. across the board. >> in the past month, it's been a monster month for solar. >> monstrous. it's tough tomorrow morning to buy them. i like the space. trina solar is the one i like. i'll be a buyer on it on down tech. >> i've taken that one around the block a few times. it's a good time for the company. not expensive. >> your girl. the bears are chasing one auto stock. we reveal the name and the trade

right after this break. more "fast" straight ahead.

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false. and hypothetically, he said in these situations it's possible that they could levy a fine to orexigen, civil penalties or the withdrawal of the drug from the market. people i talked to yesterday thought there would never be a consequence like this. it is affecting the stock. >> thank you very much, meg tirrell, some down a swift 12%. we have your first look when we come right back. stay tuned.

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