that does it for us on "closing bell" this afternoon. "fast money" is coming up in a few moments with mandy drury in for melissa lee. what's on tap? >> bullish note pout by piper jaffray and we're going to be talking about apple. yeah, it was in fact the only positive dow component on fairly significant volume. we'll talk about that. also talk about the yahoo! shareholder meeting and also dm's launch of the new cruze for the car lovers over there. >> straight over to you guys. >> "fast money" starts right now. we're live at the nasdaq marketsite. hello, everybody. i'm mandy drury sitting in for melissa lee and our traders on the decemberric dan nathan, david seaburg, brian kelly, beaks, and guy adami. good to see you all. and tonight on "fast" follow the smart money? well, carl icahn kark out of netflix. why the billionaire investor got out and the comments he made that could signal the top might be in for the stocks. plus stocks may have ended lower today but we have uncovered a secret indicator that says now could be a good time to buy, and we'll tell you all about that.

but first to the sell-off today, which was led by a one-two punch of both the transports and the industrials. the transports officially closing in correction territory tonight. guy, is this a classic sign maybe to sell stocks? >> well, it should have sxwrngs it should have been months ago, but yet the s&p continues to grind higher. i still think the s&p has room to the up side. with that said the transports, the ioit down almost 2% today on a generally benign tape, obviously a little bit negative, and here we are at levels we haven't seen in quite some time. i think the ioit is setting to trade down to the 138 level we saw back in october and then we'll see if that finally has impact on the transports. iyt down on a weekend where we "barron's" came out with a bullish cover piece. morgan stanley initiated yesterday very bullish on the airlines yet they can't get oust their own way. started with the rails, moved into the airlines, now it's in transports. you've seen fedex trade from 186 down to 175. i do believe they're trying to

tell you something. that said, the s&p just wants to go higher right now. >> dow theorists have been raising the red flag for some time now when they look at transports but it hasn't really -- >> it hasn't come to roost i guess unless you're in the rails and the airlines. those have been tough trades. here's the thing. you can subscribe to dow theory or you cannot. but what came out today was actual fundamental data on the rails. so every week the american association of railroads puts out their carloads. today it came out for the week over week it's down 2.4%. for the year you can see on the chart it's actually running below last year. what we've had is this build-up in inventory in the economy, anticipating the snapback after that cold winter, and it's not happening. so now rail car loads are dropping. inventories are going to be a drag on the economy. so i think the transports are telling you we have a stagnant economy at best if not a weak economy and the consumer snapback is not happening. >> so you're a little more on the bearish side there. the really interesting thing today is the selling just appeared to get even worse.

to intensify if you like after carl icahn said this on the "halftime report." take a listen. >> i'm very concerned about the market. and i think the market is overheated. especially the high-yield market. it & it's sort of a sad commentary because i think the public is walking into a trap again as they did in '07. >> what do you think, dan? are you buying into this? >> listen, i don't think mr. icahn kind of spread the rally on here -- or excuse me, the sell-off midday. but i do think what he's trying to say very specifically, he spent a lot of time talking about high yield. he's talking about potential for systemic risk. when you think about he just exited netflix, it was a genius position, used the opportunity to talk about apple, which he is a massive holder. i think he's the 11th largest shareholder of the largest equity on the planet. when you think about it what is he saying here? he feels comfortable in apple. when you think about this, it is a buy for all intents and purposes. when you think about that cash and you think about that dividend yield and you think about their positioning.

he is basically moving to some very defensive sort of positioning. that's what i take. but i don't think his comments really had the market sell off. i think the market is concerned with the fact here we are mid-week and we don't have a deal on greece and we had so much enthusiasm built up late last week early this week. >> is there any possibility do you think icahn is trying to warn us? basically saying with more respected investors warned about the market in '07 we wouldn't have had the flobz 2008 and onwards. >> carl icahn, i agree, he didn't spark this sell-off. it was already rolling over when he came out and spoke. i think in general apple's a stock that he's got a core holding in and he's coming out warning about the market and levels of valuations of stocks. i think it's a little bit contradictory. but stocks are near their all-time highs. there's no doubt about it. i think we need to see topline growth to continue. i think carl icahn's stating a lot of the obvious to be straightforward with you. high-yield market? i'm concerned about the high-yield market as well. i think the corporate bond markets could be a disaster. that could be the next big liquidity crisis that occurs. >> the next big liquidity crisis? >> the important thing that

people need to know is that it's not going to be contained just to the high-yield market because the high-yield market is very illiquid. high-yield bond investors are doing, they're using s.p.y. puts to hedge these portfolios. that's the transfer mechanism to stocks here. they definitely do have a high correlation to one another. but that's what you need to be aware of. and i think that's what mr. icahn's getting to when you're saying watch the high-yield market. in my view it's a disaster waiting to happen. >> as we mentioned icahn also discussing apple today, saying he hasn't sold a single share and would buy more if it goes lower. meantime, piper jaffray coming out with a note saying there's one under the radar metric that could drive the stock higher. joining us now is the man behind that note. piper jaffray's managing director gene munster. what is it we should be looking at sneer what's the metric? >> the resale value. so to get a read on iphone demand we look at the resale value of old phones and compared to the retail value today. what we found is that the phones today are getting higher prices

in the after-market, which is a sign that demand is higher. so the quick numbers are this. is it a typical iphone 6 sells for 72% of its retail value he, 285 days after the launch? that compares to an iphone 5s that sold for 60% of its value 285 days after its launch. credit my crack team here with travis for putting all this data together and tracking this on a daily basis. but that's what we're looking at. we also look at it in china. and the comparisons are similar. the good news is this, is that these higher resale values are a strong indication for future iphone demand. >> hey, gene, we often here, you know, one of the main justifications for owning apple is valuation. and here it trades below market multiple, x cash it trades way below a market multiple, 10 1/2, 11 times. when you think about the bump that we had, because we know about iphone 6 and we know about that upgrade cycle and we also know that china as you just

mentioned, this is a big geographic expansion. next year analysts are expecting 7% earnings growth and 6% sales growth. if you think about that, if we don't have increased, you know, gross margin here, you're going to have a stock that's more expensive next year. and do you lose one of the legs of the story here for owning the stock? >> potentially. i think the good news is this, is what you're really debting to is these tough comps that are coming out next year. haf had great growth in the last two quarters and it's slowing down. one of the potential drivers into creased earnings is margin expansion. typically in an s cycle, which we'll have this year, the 6s, that should have higher margins because they get more cost efficiency in manufacturing these. i think you can mail that in that that's going to happen. on top of that is from a multiple perspective is once we get into the iphone 6s investors will naturally look to the iphone 7, which they'll probably be more optimistic about. so i think that all the bad news of the tough comps is getting priced in and the good news is

that as we start to look at 2016 that should be a slight positive for the multiple. >> okay. and you've got a $162 price target and a rating of overweight. thank you very much, gene munster, for joining us once again. let's trade this back on the table. b.k., what do you think? >> listen, i think, one, if you're in apple you don't necessarily have to sell it right now. but i think there's much better trades out there. there is the back half of the year where we have this iphone 6 refresh where there is data saying that everybody is not quite into that yet. my question is further after that. what's next for apple? they have yet to really innovate anything. i know that's going to be controversial. people are going to say oh, no, they're innovators. but really what have they done? they bought beats, they didn't do anything with it. their watch seems to be somewhat of a dud. so for me -- >> really? you think so? >> do you have anybody saying they're selling out? you don't see any lines for watches. i know one fellow on this desk his name's dan, he's -- >> you've got an apple watch. >> i got the watch. i may actually go back. i'm a little disappointed in the product. it's a good product. it looks okay.

but the bells and whits stles aren't what i expected it to be. i don't use it the way i thought i would use it. i talked about app well dan here. we had a bull-bear probably midway through the year and i was very bulled up on the stock and i thought the watch would have been a big up side surprise given there wasn't a lot baked in. maybe it's a little bit of an up side but i don't know if they're going to be able to drive revenues. >> the stock hasn't been doing a whole lot, has it? >> i think from a bigger question from an upgrade perspective what dhoe do with this device in sn it's a fashion product. i'm not going to upgrade next year and spend 7 hundreds on a new watch. can me figure out a way to get this to be the upgradable product going forward? i think that changes the direction. >> dan makes a great argument in terms of valuation. if they're declining in terms of growth how do you expect their multiple to expand? i think that's a great point. i'll say this about trading the stock. it's been building a base here, 125 to 130 effectively since march, and i think that's exactly what it's doing, building a base. i do think it takes the move to the next level 15:005 to 160. on the down side i get really

concerned if it broke 122. >> let's move on. yahoo! hosting its shareholder meeting today. but it's what marissa mayer did not say that has one shareholder absolutely irate. we're going to hear from him next. plus, after a solid performance so far this year, have the banking stocks become maybe too hot to handle? a look at which names are looking a little overvalued and whether it might be time to take some profits. later on, a top executive at general moat 76ers here to unveil the company's latest model. but new model or not, we want to know if a deal for gm is coming. phil lebeau will be here with a special report. more "fast" right ahead. you prox as the company that's all about printing. but did you know we also support hospitals using electronic health records for more than 30 million patients? or that our software helps over 20 million smartphone users remotely configure e-mail every month? or how about processing nearly $5 billion in electronic toll payments a year? in fact, today's xerox is working in surprising ways

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the homes good retailer reported sales that missed analysts' expectations. retailers see second quarter same-store sales up by about a 2% or 3% area. earnings per share between $1.18 to $1.23. analysts were looking for about $1.23. sought mid-point of that rainlingage below some of those

analysts' expectations. you can see the reaction there. it's gotten back a little bit of those losses in the after hours but still, mandy, down by about you can see 2%. back over to you. >> thank you very much for that, dom. back at hq. let's trade this back on the desk. what do you think of bed bath and beyond. >> this is a story that doesn't jibe with a lot of housing data we've seen. we know home depot's been killing it. but then home depot's taken all the sales as relates to that. we know lowe's had some disappointing results, we know whirlpool had some disappointing results a couple months ago. so this is not a big surprise here. i just don't think you accept in and buy bed bath & beyond right here. it's not an expensive stock by any means but you need to see some sort of reacceleration and growth. >> b.k. >> if anything $68 is what you're shooting against. if it breaks 68 we've got a lot more problems. you don't have to rush out and short it. if we wait i'd wait for a pop off any rebound here to get out of it. but i guess i'm more in dan's camp. this has kind of been a loser all year and i don't see any catalyst that's going to get it going in the second half of the year. >> great minds think alike.

let's move on to netflix kicking off our top trades. the stock hitting 700 last night in the after-hours session after announcing a 7 for 1 stock split. today, however, losing those gains. once carl icahn came out announcing he sold the rest of his stake. here's what icahn told scott wapner and the gang on "halftime" earlier today. >> i'm not in any way criticizing netflix, but when we did it it was pretty much a no-brainer. it was very hard to compete. netflix years ago was tremendously undervalued because it was very hard to compete with them. i think today the competition is somewhat easier if you see the secular change going on where you're building service, where they can go over the top and there's going to be cable competition, cable may change dramatically. >> dave is buying what carl is selling, right? >> i tell you what. you look at netflix and you look at apple. buying netflix is greenfield, right?

international expansion. i can go on and on about where i think this stock's going in five years. i said 1400 bucks. i think it can go higher than 1400 bucks and i walked you through it last night. but i think in general apple we talked about it just a minute ago, apple's a stock that you're basically buying an iphone tail. whether or not they can continue to push that and really expand and gain sales momentum or maintain it at least. my thought is it's a crazy trade. i want the growth trade. i want the netflix trade. there's much bigger opportunities -- >> but icahn, here's a guy who rode it up 1,000% from the lows here. he's seen a lot of the bull case come into fruition. and i think it's really intelligent when you see a guy ring the bell at bottom and possibly be ringing it at the top. the competitive landscape has changed so dramatically and we haven't even seen -- this is one thing we were expecting out of apple. some form of product that is going to be a competitor with netflix. all the cable channels are going in. i think a much better trade is time warner and i think that's what mr. icahn is alluding to. it's a much, much cheaper stock and we know they have the content and they've consistently

done it. i'm not sure "orange is the new black" resonates in china the way a lost time warner stuff does. >> how many millennials do you know that actually have cable in their house now? >> that's the point, david. they've knocked out the hbo go and the now and all this sort of stuff. this is where the competition's going to be. i think you go time warner, you do not buy carl icahn's scraps at the high. >> carl icahn's scraps. ouch. he was saying that apple is where netflix was a couple of years ago. what do you think, guys? >> i don't think there are any no-brainer trades, number one. i'd be shocked if mr. icahn not only rang the bell on the bottom but rang the bell on the top. i will say this, though. the price action today was disappointing, trade four, five times the normal volume, had the reversal. i still think it's very hard to replicate netflix. i do think there's competition coming. it may come in the form of at&t and directv. i don't know. but i also think it's not that close to happening. i still think reed hastings makes every move the right way. i do think there's up side in the stock. >> okay. in five years' time from now we're going going to see whether it's 1400 or more as you're

predicting. >> fingers crossed. they've got pricing power and momentum in international. thaex pangs's going to be pretty solid. >> we'll be watching. also on a quick programming note do not miss carl icahn live at cnbc's delivering alpha conference in new york on july 15th. you can go to deliveringalpha.com for all the information. okay. next up yahoo!. at the company shareholder meeting this morning ceo marissa mayer explaining how she is working to turn around yahoo!. take a listen. >> what we've really embarked on is a multiyear transformation of our business. working to return yahoo! to growth but also introducing new product lines and business lines that can carry us to that growth. >> but can she deliver? eric jackson is ironfire capital's founder and a yahoo! shareholder. what do you think? can she deliver? >> i don't think so, mandy. i think today was just a lot of regurgitation of sound bites that we've heard -- >> okay. we seem to be losing eric a little. okay. should we try for eric maybe in a second? should we try him again? okay. while we're trying to sort out

the technical issues here, let's trade yahoo! on the desk. what we heard so far from eric is he's not sure whether she can turn it around. what do you think, guys? >> eric's been very consistent. he's been a huge, huge critic of marissa mayer. but here's the story. here's the main headline that i saw today, that they are working with the irs to try to figure out a tax-free spin for their alibaba stake. that's the story right now. but here's the thing. yahoo! can't really get out of its own way because alibaba can't. the stock is still very much tied to it. there's a massive, massive ipo lockup coming in september for alibaba. 1.4 billion shares here. so that's really what's keeping yahoo! under wraps here and the uncertainty about the spin. >> yeah. when it comes to baba i was long it for about a week here, trying to catch a bottom maybe on this pullback, and i saw it today because the stock just trades very, very heavy. it doesn't look that fantastic. i like the idea of baba as a play on the change in the chinese economy from the export led to the consumer led. i think that's your big secular play. it's just a question of timing here. so for now i think you stay away

from both baba and yahoo!. >> okay. >> she inherited alibaba. you've got to give her -- some props for that i guess. but think about it. if she didn't walk into that tha, where would yahoo! the stock be trading without alibaba? i know it's a hard game to play but you have to ask yourself that question because frankly for the last six months the stock has been grim death. >> if we can get eric back it would be great to talk to him. i know one of the things eric is asking is essentially where are the new products? here we've got him back. eric, great to see you again. eric, tell us more. i know one of the concerns you have is you want to see some new growth avenues, some new products. what are you looking for, eric? >> well, i mean, think about it, mandy. marisa's been on the job for three years, and she was hired because she was a product person. but where are the products? where are the new products? there haven't been any. i mean, if you listen to the webcast today, the most exciting thing that they announced was that if you use e-mail on yahoo! you can use pretty wallpaper in behind, and that's supposed to drive engagement? you know, right now twit area, lot of people are saying twitter

needs a new product-based ceo, but it certainly hasn't helped yahoo!. i think she's just been a bad fit. she hasn't delivered on the hype that she came in with. and she really does need to start delivering. >> if you say she's been a bad fit, who would you if anyone prefer to see in that position, eric? >> well, i think there are a lot of capable people. if i had my choice, i'd love to see chris cox, who's the chief product officer at facebook, come over and take the reins as ceo of yahoo!. i don't think that's going to happen because why would he leave? i think, though, to own the stock, though, right here at $40 it's really priced as if the irs spinoff is not going to happen. it's at a six-month low. so there aren't any catalysts that we know are going to happen immediately but an irs ruling could happen anytime. alibaba as it depreciates it's going to pull yahoo! with it. i think it's still a good stock to own at these levels. >> hey, eric, brian kelly.

they just re-signed katie couric again, and that seems to be somewhat of a new product type of direction going away from your traditional tv to the online. where do you stand on this? do you think that's a game changer at all? >> no. i think it's a total bust. the "wall street journal" came out a few months ago and they said that of all katie's video views at market rates it generates about $2.5 million a year in ad revenue for yahoo!. she used to be paid $5 million a year. she just re-signed a multiyear deal at $10 million a year. i can't make that math work, brian. i don't know if you can. >> i can't. but i was told there would be no math on this test. so. >> 4 out of 3 people can't do math. eric jackson -- >> however, before you let him go, you've got to wish him a happy birthday. come on. it's e.j.'s birthday. >> we're not going to sing it for you because we're running out of time. but if we had time we'd burst into song here. happy birthday.

>> thank you, guy. thank you, mandy. >> still ahead, goldman sachs after the big run in bank stocks this year. could the sector be about to take a serious turn for the worse? we'll tell you whether it's time to take profits next. also in the meantime here's what else is coming up on "fast." >> it's not good to keep secrets. or this time maybe it is. ♪ that's no secret the secret reason why the rally could keep on trucking. and whether our undercover indicator is a good reason to buy stocks now. plus -- ♪ well, have you? goldman sachs has. and now they're saying to buy ford and dump general motors. but they might want to change their mind after they hear what one gm executive has to say about their latest model. that executive will join us when "fast money" returns.

welcome back, everybody. two major banks getting a downgrade today. deutsche bank slapping hold ratings on both goldman and citi. could this be the beginning of bad things to come for the financials? cnbc's bob pisani has more details. what do you think, bob? >> it's amazing watching the bank run because most of the investors seem to think there's a lot of room because rates are going to go up.

take a look at this. banks have been the standout performer in the second quarter. blafrnlgz up over 10%. the s&p up 2%. the investors have noticed. the stocks breaking out a month ago. if you look at the etfs, that's the kbe, not only is it a new high but it's seen a surge in volume recently. so the big issue is what's moving the banks, mandy. it's improved economic data. that's the most important thing. there's been hope that loan growth would improve. that's been happening but it hasn't transrited into revenue growth because rates are so low. the big issue is moveup in short-term interest rates or the belief that there will be a moveup in short-term interest rates and that the yield curve would steepen. most bank loans are tied to short-term rates. here's what i'm concerned about. there's two problems. first it's possible rates will stay low for a much longer period than people think and the it's not going to be a big help to overall revenues. the other problem i have is banks' prices have moved up so much that you now have to believe there's going to be a really big increase in rates in

order to justify buying bank stocks right now. that's why i think this call for deutschebank, kudos to them today. by the way, they moved goldman sachs and citigroup there. they acknowledged the economy's improved but the huge rally in these stocks means there's less up side. that's their claim. and i think there's something to it. the bottom line is this. right now one analyst i talked to said you have to believe that the fed fund rate is going to be above 1.1% a year from now to get a lot of move up in these stocks. well, they're talking maybe 1 1/2% a year from now, 1.6%. maybe it will happen. the point is you've got to believe there's going to be a significant move up in rates to justify bank stocks right now. that's the concern. >> that is the concern. that's the question. thank you very much for laying it all out for us, bob pisani. so the question here for the desk, guys, is are bank stocks overvalued? dan, what do you i? >> i don't think they're overvalued. they're cheap and they're cheap for a reason. a lot of the reasons we had the run-up in these, jpmorgan has had this massive breakout. it's up 25% from the lows in january, and i think it was

obviously anticipation of higher rates. i suspect that you're going to get some q3 or second half guidance. it's probably not as rosy. and you may not have rates go as high as people think. i'm positioned for jpmorgan to make a move back to $66. they're going to report july 14th prior to the opening that's in the july expiration cycle. and options are kind of cheap for directional players. that's how i'm playing it. >> you agree, dave? >> yeah. long-term you want to oent financials still. maybe they pull back a little. earnings is going to dictate. guidance obviously going to dictate. but i think longer term you want to be in this space. we saw this trade happening. it came up to this level, you know, rather quickly. it may stall here for a bit but i think you want to stay involved. >> okay. last word beaks. >> i think it's going to be very difficult for rates to go higher. especially the 10-year over 2 1/2%. the only economic indicator that's doing well is employment. every other of about 85 different indicators is actually turning down. i think banks are a tough trade here. >> tough trade. okay. still ahead, will they just do it? the two things you that need to watch ahead of nike's big report tomorrow.

plus the one health care stock that the street seems to think will be left all by itself alone in the m&a frenzy. we'll tell you what it is when "fast" returns.

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transports were the big laggard, falling nearly 2%. here is what is coming up in the second half of "fast money." playing to win. nike shareholders looking for a home run tomorrow when the company reports its earnings after the bell. so coming up we'll reveal how the traders are positioning ahead of the release. plus with markets near record highs some are questioning whether the rally might just be running out of steam. ahead we're taking a look at one under the radar sign that could indicate more room to run still. but let's start with the auto makers, with gm taking the wraps off its new chevy camaro convertible today and later tonight the new chevy cruze. phil lebeau joins us for a first on cnbc interview with general motors' evp, mark bruce. phil, over to you. >> thank you very much, mandy.

i'm joined by mark royce, the head of product development, full, for general motors worldwide. this is the latest one right here, the new cruze which you'll be showing to everyone tonight. you've packed a lost content in this. i know we can't show people this vehicle but you've got a lot of content in there. >> it's a great car because this is the fifth car. we've got a product onslaught right now. we're in the midst of launching 12 vehicles right now. in general motors. this is sort of the last reveal, and we're going to launch in lordstown, ohio on cruze. this is a car that is about three inches longer here and most of that is in the rear compartment for the rear passenger, but it's 250 pounds lighter. and the 1.4 turbo is a new turbo engine for us that is about 150 horsepower versus the 138 that it replaces. we've got 40 miles per gallon on the base vehicle. and again, 250 pounds lighter. >> and more content. >> oh, yeah. safety and the replication of

smartphones with both google and apple applications in here. it really simplifies everything. and a wi-fi hot spot that's mobile is standard as well p it's a great little car and it's really fun to drive because of -- we've taken the mass out of it and increased the engine horsepower. so it's really fun. >> as you're unveiling this, you know that over the last month, month and a half much of the conversation in the auto industry has been about the suggestion from sergio marchione that fiat chrysler and yen motors merge. you guys have flat out said we don't need a merger right now, we've got what we need, we don't need fiat chrysler. still your position? >> stilt our position. we're flattered, number one, because we've invested a lot in technology. we've got great scale. we compete in most of the global markets around the world. but we do partner with people like ford on things like transmissions where we can both make a more efficient use of capital 37 so we've done that in a couple places very successfully. we'll continue to do that. but a wholesale merger we don't

need that scale. our trucks and crossovers and utilities and nour our cars we think are going to be the best in segment here worldwide. we're really putting the heat to our product pipeline and really going hard. >> yes even as you do that, even as you grow profit, increase your profit margins, investors are not rewarding your stock and pushing it higher. i don't expect you to comment on the price of the stock -- >> i can't, no. >> -- but what is it going to take to say to wall street look, we are doing what was asked of us? >> yeah. i think we can say that all we want but we have to demonstrate it. and the customers and the marketplace are the judge and jury. every single product that we've introduced here over the last five years has been, you know, segment leading. look at the truck share that we're running here today. you know, great truck programs. and now the cars and the refresh of the cars are next. that's what you see here tonight. and we're very excited about that. we've got to prove it in the marketplace. and our customers are going to tell us whether we've done enough. >> our folks at the "fast money" desk have a question for you. guys, go ahead.

>> it's brian kelly. >> hi, brian. >> when you look at car sales, we're running about 17 1/2 million units monthly. that's a level where the cycle has turned. at the same time there's a tremendous amount of capacity. so what are you guys doing at gm to mitigate that? because it seems to me you have a lot of supply coming out there and we had an unusual event where cars were very old and you had this big ramp-up, and that could be turning now and you guys could be stuck with a lot of inventory. >> yeah, i don't think we're in that position at all, and the reason why is this. as we've seen the market grow steadily over the last few years, we've managed capacity with operational capacity. in other words, we aren't building more facilities. we're putting more people to work on shifts in those plants and adding the cars to the existing plants. we've got a very flexible manufacturing structure here, and most of that is operational capacity. so we are very healthy in terms of our break even point as well. that break even point largely

has not changed since some of the tough times in the country and economy went by a few years back. we've managed that incredibly responsibly but also with a very focused approach to putting new capacity in existing factories and adding operational capacity like putting a third shift on our wentz slil assembly plant that makes our new mid-size truck which frankly we can't get enough of those. that's okay right now. maybe we and he will produce one less than the market's asking for. that's where we're at right now. >> mark royce, who is the global product chief for general motors, had a big night as they introduced the cruze, and guess what he's doing afterwards, mandy. college world series. got a vandy guy here waiting for them to win tonight. back to you. >> have fun. thanks very much. sticking with the orders, goldman sachs shifting gears in a note today and in fact downgrading gm to neutral and upgrading ford to buy. we saw today the gm shares dropped by just over 3%. let's go around the horn on this question, then, guys. would you rather buy ford or -- what? >> it's a game we play on the desk. would you rather -- you've got to set it up.

look at the deco. >> ford or gm? what do we think? >> i like ford. i think it was a good call to upgrade ford. it's going to trend higher over time. it broke out here through the 50-day and we think the chart looks great. i'm a buyer of ford. >> you're a buyer of ford. dan. >> i don't like either of them and i don't think you have to buy them here because listen, they are levered to a reflation in our economy but as b.k. said there's very few things that in my mind are really ticking. that's really i think what carl icahn was also saying too. so i don't think you have to buy either gm or ford. >> always the contrarian there. dan. >> dan's a real smart guy. so i'm going to stick with him. i completely agree. i don't think you buy any of these. the point is you're having a tremendous supply of cars out there and we had a very unusual event where the age of cars were the oldest in about 30, 40 years. that's not going to happen again. the cycle could be turning. if i'm going to play the car market, i want to be in the connected car. and i think you guys know where i'm going with that. >> the connected car? >> yes. blackberry. that's the way you want to do

it. they're the ones that have the middleware that run all the connected cars. >> i'll play the game the correct way as david seaburg did, would you rather, given the choice between the two, the answer is ford. if you don't want to plate game, don't play the game. just say i don't want to plate game. but don't give one of those answers. the answer is ford for the reasons that david cited and for the fact that maybe finally you're getting some mojo in the stock. >> okay. news alert on disney now. cnbc's dom chu back at hq with the story. >> mandy, walt disney announcing it's going to boost its dividend by 15% on an annualized basis. that's important here. the company will begin paying it twice a year as it continues to benefit from its "frozen" movie franchise. it also looks forward to a new "star wars" release later on. the shares hit an all-time high closing down by about half a percent but it's up by about .4% in the after-hours, 263,000 shares have traded but it's important here that 15% boost means it's now $1.32 per year on

an annualized basis. the dividend yield, guys, about 1.16%. back over to you. >> thank you very much. can't wait for frozen 2, 3, 4, 5:006 -- >> don't even have to wait for that. "star wars." some projections are it's going to be a $2 billion movie. that's not counting a lot of other stuff. you don't have to bite stock at all-time highs at $113 or $114 in the after market. you can start pick at it if you're looking out to that december 18th release of "star wars," 105. put your stop -- or your buy order right there. >> dave? >> i think disney's going perform well over time and you want to own stocks that own the content. that's disney across the board. you don't want to own the networks. you want to own the content. i love disney. >> you love disney. okay. still ahead our secret indicator that could spell more gains for stocks. we'll tell you what it is and how you can profit. plus a major buzz kyl for humana. could it be the last man standing after all the other big health care companies make a deal? all the details next. more "fast" straight ahead. ♪ all by myself

welcome back to "fast money." cash is piling up on the sidelines as wall street's sentiment turns cautious. but could this be a signal to die? with all the details cnbc correspondent deirdre bowlesa. >> according to bank of america trading against the grain may actually be the best way to make money this year. put another way, buy what wall street is selling. as you mentioned, wall street sentiment has turned remarkably bearish. strategists are recommending allocating only about 50% of their portfolio to equities. now, the historical average is higher, 50%. if you had employed this contrarian strategy in the past you might have had a chance to make some money here. b of a followed that return over the next year following such bearish sentiment went positive 98% of the time. we also pulled up some kensho data and found those returns stood up 20% on average. according to this analysis, ownership may be the most important signal and now may be the best time to buy stocks.

as for what to buy they say stay contrarian there too, sell the most loved or overowned stocks and buy the most hated or underowned stocks. you can check out the top ten of each on cnbcpro. and i'll give you a hint of the most underowned. it includes a tobacco company, a salty soup company and a confederate flag-selling company. i should say previously confederate flag-selling company. i'll leave with you that. see if you can guess any of them. >> can any of you guys guess? you guys are pretty smart. >> kensho is much smarter. bet you kensho could answer. plug it in, it spits it right out. and b.k.'s avatar in twitter is kensho. little known. >> thank you, deirdre. let's trade this. it all makes good sense, doesn't it? ownership is a really good signal. >> well, there are a couple of different things. yes, you want to go against the grain, and the extra 10% allocated to stocks could get that last leg up. potentially. but i would just caution that. allocations have changed

dramatically over the years, and people -- the 60-40 mix just has been proven not to work as well as some other allocation strategies. >> i would add this. i don't think at this stage of the game when you have an s&p 500 that is churning here, it's unable to break out, it did not confirm the highs that we just saw in the russell, we've seen some sectors breaking out but you don't want to go for the laggards right here. look at what facebook did. it just went up 7 1/2% this week. this is a stock that had also been churning but it broke out and is a leader but here's an example. qualcomm. it's down 12% on the year. it's a cheap stock. pays a good dividend or whatever. you don't want to tone here. new three-month lows. i think you want to stick to what's working. >> stick to what's working as well, dave? >> yeah. we're in a range. i think netflix is working by the way, dan. i think you stick with netflix. but in general what's the next catalyst to really get us to the next level? i think it's going to be seeing top line interest growth. we need to see that next quarter earnings reports. you know, that's going to really get these stocks going up.

and i think the stock buybacks as they start to fade when rates go higher we're just not going to see the juice in the earnings growth unless we see the top line starting to pick up. >> let's move on. shares of humana sinking 3%, which brings us to today's, wa, wa, buzzkill. m&a rumors have been buzzing between anthem, cigna, aetna and humana but investors are now worried in a space this ripe for consolidation human a could be the one left without a match. >> end of april they reported a decent quarter the stock had a little best a run but was having trouble 180 then at the end of may they said there's some takeover possibilities here we're working with goldman sachs. the stock went from 180 to 220 in a heartbeat. now we've round turned. we're right back down to 184. what do i think? i think at 16 1/2, 17 times forward earnings it's in line with the rest of the space. i think it's the best company in the space. i think they report in a couple weeks and i think you own the stock against $180. >> b.k.?

>> i think for a trade potentially you can do that just because it's cut off so much. what concerns me, though-s that clearly there's people looking at this company and nobody's bid yet. for me it's only a trade at best. >> okay. only a trade at best for humana. there we go. down today. still ahead two major companies out with their earnings after the bell tomorrow. we're going to give you the most important things you need to know ahead of those reports right after the break. hey, can i help you? yeah, we're interested in the iphone. we promised one to beth for her birthday. you know mobile share value plans now include rollover data, so the data you don't use this month rolls over to the next month. wow, even better. so what are you gonna do with your old phone? i'm giving it to my sister emily. she gets all my old hand-me-downs. oh i'm into bedazzling too. and you admit that? yeah...i...i used to be into bedazzling.

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dan, options traders expecting some pretty big moves out of nike earnings tomorrow, right? >> yeah. today put volume was a little elevated at 1 1/2 times average daily but the options market is implying about a 4 1/2% move. that's basically a little elevated than the average move over the last four quarters, which has been about 4%. we have a couple charts here that i just want to kind of run through when you're thinking about nike. this is a stock that actually has performed very well. it did break out before the s&p has. this is the year-to-date chart. it was kind of rangebound here. it just had this little breakout here. and i just want to take you to a longer-term chart. and this is kind of showing that breakout here after that consolidation. to me nike acts great, things are going out very, very well here. i really think you have to hold that up trend that's been in place over the last few years. this is a three-year chart. but i think up here i think above 100 the stock is fine.

i just want to make one really big point and this is something people are going to pick over tomorrow depending on the results and the forward guidance. this is a ten-year chart of the stock's price to earnings. it's basically trading up here at 10-year mizhighs, at 30 time expected growth of 10%. it is a premium company with a premium brand and it's got a premium valuation, but it's also priced for perfection. so if there's any downward guidance i think you're going to see the stock at 100 bucks very quickly tomorrow. >> priced for perfection. but you really like it here. >> i like the stock. i think nike when they came out in the fourth quarter the trends were super strong. so i think the guidance is actually pretty conservative. i think they're going to beat, it's going to be a very good quarter, the stock can go through 110 bucks easy on a beat. on a slight beat. >> on a slight beat. >> but look at foot locker. foot locker gave us a real read-through to how nike's quarter's going to be. 85% of their sales are nike products. i look at it and say we're going to have a really good quarter out of nike tomorrow. i wouldn't be surprised to see

the stock trade up through 110. >> anyone else agree or disagree on that one? guy and beaks. >> the stock is getting to points where valuations are getting rich. 26 1/2, 27 times forward earnings. but these guys keep their inventories in check, their operating margins continue to seemingly grow and you can't really bet against the stock. it has been parabolic. i think what you're hoping is they come out and say something negative based on fx, the stock trades down four or five bucks and you buy it there. >> pete? >> in this space i would rather go with under armour. that to me is the better player here. great management team. they've been absolutely killing it. they have the connected sports, fitness, all of that. they just bought my fitness pal. they're going to be able to put a lot of those things into their product. that being said, on a very short term $86 seems to be a bit of resistance for under armour. i wouldn't jump out tomorrow and buy it. they'd have to prove it to me and get that momentum through 86. >> last word to you on nike. >> they're in a great spot here. look at lululemon, also back at the highs. b.k. mentioned under armour. these guys are in a sweet spot.

i don't think you want to look at foot locker and say all their sales are in the u.s. he with know nike is expose told engineering markets they have a lot of dollar, poeshz. i think b.k. said it. if you get a downgraded guidance back toward 100 that's where you step in. >> as you've all been saying watch out for what they say about forex. seems to be an excellent excuse when things turn bad. coming up on "mad money" tonight cramer talking major stock splits. the snack company that's already in your kitchen but should also be in your portfolio. jim's responding to carl icahn's market concerns. all that and much more coming up next on "mad money." also your first move tomorrow when we return. we'll have a quick break but more "fast money" coming up next. here at td ameritrade, they work hard. wow, that was random. random? no it's all about understanding patterns like the mail guy at 3:12 every day or

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netflix goes on a roller coaster ride after the split and icahn gets out. what should you do? plus the sweet spot behind the biggest gaming company on the planet and a big idea for babies that could save millions of little lives. "mad money" is next. it is time for the final trade. let's go around the horn. swimming with time, guys. take your time to flesh it out, dan. >> let me just think about what i'm going to talk about here. carl icahn, the guy obviously

made a ton of money on netflix. if you bought it anytime recently i think you have to rethink about what the near term looks like for this stock here. i would take profits here. this is an stock i would be buying. >> sell for you. dave. >> i'm going to press the ibb short i mention the last night. i think it continues lower. you can still make money from the short side of ibbs. >> what about you, beaks? >> we started the show talking about the transports. i'm going to bookend it here and i'm going to talk about the economy stagnating. i think that's the sign you're getting from the transports, which means yields are going to have a very tough time going higher, which connecting the dots means the financials are a sell. they've gotten ahead of themselves. >> you did come round to there, didn't you? you bookended it. okay. and the real bookend is -- >> i am a bookend. it's great having sure here. did you have fun? i hope you had fun. >> i had a great time. >> good to hear. conagra. on a lousy tape that stock was higher. we talked about it last night. activists involved. you stay long the stock above 40

bucks. conagra, folks. cag. >> cag is a buy for guy. okay. i'm mandy drury. you can catch "fast money" again 5:00 p.m. eastern same bat time, same bat channel, and "mad money" with jim cramer starts right now. 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 i 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 just trying to save you some money. my job is not just to entertain you, but call you and teach you. so call me, or tweet me @jimcramer. darn it all. this market's bad setup. i've been so fretting and worried about. played out