that will change until people get clarity about the cable economy right now. >> that tipping point on espn was fascinating. thank you so much. mike sant olie. that does it for us here on "closing bell." "fast money" with melissa lee starts right now. "fast money" does start right now. live from nasdaq overlooking time square, this is "fast money." i'm melissa lee. dan, steve, karen and guy here today. tonight on fast oil surging 5% hitting a two month high and the commodities makes a big call on it. live here in studio to reveal it. plus mark andreeson is here with a interview and you won't believe where he's putting his money right now. he'll reveal in an exclusive. and later, wonder why apple is left out of the rally. a top trader has the answer. and kfc plunging 8% on a massive earnings miss and the bad news from china that has the

street talking. jane wells is live in l.a. with the latest. jane? >> hi melissa. chicken in china has fizzled. half of the revenues come from there. and same-store sales rose only 2% and the street was looking for closer to 10%. though the end of the quarter was, quote, significantly better than the big, but that stumbled with the long dollar and full earnings share will be well below 10%. and they grew the top and bottom line but missed expectations. revenues of $3.43 billion was low. and $0.07 be lee the street. restaurant margins missed expectations except for taco bell. and india, same-store sales down 18%. three times worse than expected. on the plus side things are not

like china for taco bell. 4% same-store sales growth and just opened the cantina. we hope to learn about it on the call tomorrow. pizza hut had positive same-store sales growth, albeit 1%. and finger-licking good versus evil colonel sanders is now in a comic. up 3%, better than expected. maybe the mcdonald's bits are working but they are fighting for your dividend which yum announced will raise 12% for the quarter. >> jane, thanks for that. in terms of the trade, there is a lot to unpack with the 17.5% decline in the after hours session. so dan, you were a skeptic for a long time and here we are. now what? >> i have been because i think that their guidance is optimistic. they missed estimates the company had guided to. so the street is probably going

to give up a little bit on this name. i know you guys were just talking about it. it is trading near 52-week lows. and the problem why you have this massive move is there was investors that followed very smart activists into the trade earlier in the year when we saw the stock go above 91. and i think you'll see a lot of fast money come out of this. >> and for the activities, how do you fit a 2% comp in china versus 10%, that is a huge gap to fill. >> the second quarter was down 10% which is what wasey gave them a pass. the stock traded in kind. you can't give them a pass now. going into this it was a expensive stock and dan said that. how due trade -- do you trade the name? 65 was the lows in 2013. spent the whole first part of the year holding $65. feels like it wants to trade there tomorrow. anything mother of 15 million

shares and holds i think you have a tradeable bottom in yum. >> does this strengthen the hands of the activist. and in terms of enacting change. but here a lot of them wanted to spin out the china business and that is the weakest part of the business. >> i guess if the argument is if you spun it out, the china valuation would allow the rest of the company to be valued more high lie than it is now. it adds pressure on management for sure. but the magnitude of this move. this is big. this is not a levered company. this is a huge behemoth and down that much is really -- that is a significant move. but still not cheap here. >> even at this down 17%, it is still not cheap. >> well, if you take what they are saying at face value on thur guidance, it still has a two handle to me in the 20s which that ain't cheap. >> here is a conundrum. we have to great data points from companies about china. we got yum, which was horrible

and nike which was stupendous. so grasso what, do you do because it is confusing? >> i think the china story is left untold and i think you have to give it breathing space. i wouldn't rush in. you have to wait. the three day rule. and mcdonald is fires on all cylinders. stay with that over yum. i don't know about short yum. domino's pietz up 13%. i love to talk about this one. you get incremental china and international exposeureexposure an i would stay there. but yum, i wouldn't touch it. i would be long mcdonald. >> that is the question of u.s. multi-national stocks have to think about as we head into q3 earnings. tim cook won't stop talking about the growth of this consumer in china. and he wrote jim cramer an e-mail about how good it is. but let's seg rate nike.

this is a luxury product. and kfc in china which is a middle class product. and i know tim seymour has made points about this. i think it is important to insolate that what is on the upper end and iphones are hitting the stock here. but i don't think you can lump all of the brands together and this probably tell you that the middle class consumer is not as strong as you thought. >> inspirational. apple, nike -- all inspirational. >> and nike is not? >> no. and that is telling what is going on with the chinese consumer. not unlike what goes on here. aspirational products do great and people reach. but the stuff in the middle not so much. >> and in addition to yum, we have declined in the fast food space. mcdonald's wendy's, el pollo loco.

all down. and tomorrow will be the guidance and we'll continue to monitor the movement in the after hours session. and in the meantime a couple of plays in the biotech sector. meg tirrell is in baltimore with the details. meg. >> express grips is the largest pharmacy manager coming out to cover the big cholesterol drugs from am gen and things we've been talking about this year. they wondered whether they would try to pit those two drugs against each other to secure discounts. now express scripts is going to cover both of them. this did secure discounts. it is not disclosing how big the discounts are or if it got bigger ones from one company than the other. they both have list prices of more than $14,000 a year. so there are worries over whether this would bust budgets. express scripts is saying for the largest plan which covers 25 million people it won't bust budgets. as part of the plan they have

secured discounts and make patients and doctors go through a lot of protocol before they can get these drugs. they have to try statins and have to send data showing that the statins didn't work for them before they try these new cholesterol drugs. and they are putting in limits how much the companies are raise the price of the drugs. this is very interesting in the context of what we've been seeing in the rest of the biotech industry the last couple of weeks. a lot of companies taken creases of 7-12% a couple of times a year on the drugs. express scripts is putting a cap on what the drugs can be raised by. and they are going back through all of the drugs they cover and trying to implement price increase limits so this could be potentially broader than just these cholesterol drugs. but again the headline drugs getting benefits from the largest manufacturer. >> meg tirrell, thank you for that. and the 12 week course of

treatment, $84,000 to $95,000. so big costs. karen, in terms of how it filters through, because you're in different parts of this trade? >> right. for anthem which is the well point new name i would imagine they are going to negotiate with -- we don't know what express scripts negotiate for themselves. i can imagine we'll see something out of cvs as well. i still like cvs. it has been caught up in the whole health care down draft. >> the whole sector across the board today, a rough time. although off the lows at the close. >> express scripts has to hold $80. trades at 13.5 times forward earnings. but off a disappointing quarter, you have to wait to the 27th for them to report or own it against $80. coming up, one of the biggest name in tech. mark andreeson joins us with and raw in a no-holds-bar interview.

live from the vanity fair summit. and a big miss for yum17%. and another big mover, adobe falling hard on weak guidance. look at that decline. down 7%. the conference call is under way and we'll bring you the headlines in a big way on "fast money." keep it here.

welcome back to "fast money." andrew sorkin is at the vanity mayor summit and talking with the biggest in media and right now sitting down with marc andreeson for an exclusive interview. andrew take it away. >> thank you. the one and only marc andreeson, looking at his wife over there while we're on live television. good to see you. >> how is it going? >> it is great. we talked off camera what, is the hottest thing going on right now and you said the combination of drones and ai. >> drones and vr. well both. >> and what is happening. there is a big decision today, a fine, an faa fine of a drone company for $1.9 million for just flying these things in the sky. so there is no real rules yet. are we all going to look up in the sky and see drones every which way. >> absolutely.

there is a real issue and a technology issue. the faa has still not put in place the policy on drones and they are supposed to but they haven't done it yet. and of course the question with this is do we want the drone industry to be born here or overseas and today the uk sweden and france and german are ahead of us in regulations so the industry is at risk. also the technology will get solved. the next generation will be autonomous and see everything around them and avoid anything that moves. and so the risk of interfering with an airplane is going to go to zero. >> when jeff bezos was on 60 minutes and it showed a drone delivering packages that seems jettison. and toy helicopters in the sky, how many do you think -- realistically realistically, ten years from now. >> they are all over the place. ten years from now they're going to be operating a drone instead of you coming here. and we are still grounded almost all of the time. and we are about to have mastery

of the air in a new way and have drones from super small to super big. carrying cameras, sensors, packages ultimately carrying people it. will be amazing. >> dare i ask, it is a question that -- the word everybody is talking about here, bubble. we're in the valley bubble bubble, bubble. are we in a bubble? >> i certainly don't think so. we have just these miraculous new technologies popping out all over the place and giving broad option. you have 3 billion smartphones on the planet and they are doing very well. >> and how do you think about the public market and relative to the private market. >> i think this is where people are confused. people look at the private market in isolation and you have to look at it in combination with the public market. so the public market is activist driven. shareholders no longer want companies to invest in new projects an the same public shareholders are taking money out of the public and putting it into the private market and funding the start-ups. so you have the reallocation of

capital and growth from public to private. the number of publicly listed u.s. companies has dropped in half in the last 20 years and that is indicative of what is happening. >> and your model is such that you need to somehow exit the businesses smat point. >> at some point. >> and traditionally that has been the ipo market which is down 34% year-over-year on year. >> so ipos are much less common than they used to be and companies go public later. you can get huge value creation by doing that. so that is still a path for some companies. m&a is a path for others. there is a third path which are private exits. like survey monkey and pilot reaching a certain level when it becomes a good company. >> is that a good thing or a bad thing. >> i think it is another option or another route. whatever makes it possible to build the best company over a long period of time is the right way to proceed and it depends on the company. >> you don't look around and think this is all a little crazy.

you don't look around and think there is some sense of hysteria. >> well this is a great conference run by a great east coast magazine being interviewed by an east coast reporter and not on the east coast. so this is not representative of what we're doing every day. generally we're in the office. there is a reason we're -- >> and the phrase unicorn is supposed to be a rare thing. there are now a lot of them and some are dying. >> well of course. yeah. for a top tier venture capital, half of them don't work out. >> is that the way you invest right now? >> that is part of the model. >> you don't think of a life cycle. >> well the companies have life cycles. >> but a market cycle for yourself. >> but we invest across 20 different markets. some markets are investing in transportation and some are logistics and some are drones and ai and senior home care. >> what do you mean? >> we have a great company called honor that is growing fast and putting senior home

care people -- think of it as uber for senior home care. it is a fantastic mark. important to seniors and adult children. >> did i hear you say food? >> food. we're doing food. >> this does not seem techie to me. >> it is very techie. and everybody knows the self with the blood test and the dna tests you can do. and take that information and incorporate it into what you eat. and the mainstream food industry has become optimized about making the most unhealthy food and it is time for the tech industry to make the healthiest food you can imagine. >> can we talk politics for a second? >> sure. >> so you're a markets guy. traditionally a republican. is donald trump your man? can you ally yourself with carl icahn? >> to my dismay i'm not been offered a cabinet in the administration. unlike carl. i'm holding out for that.

>> no really what do you think of what is going on here? is there a candidate you like? >> well i am going to wait and see. i haven't done anything. i'm going to wait and see what happens. it is still 13 months away and i think it will be a number of months before we figure out what the landscape we're going to be. >> dare i ask someone you do know about, carly fiorina. >> i am a fan. i think i would vote for her for president. i think she would be good a president. >> when you look at her track record as a ceo? >> i think she has a better track record. she operates in the neighborhood. swap her and hillary clinton and it is an interesting thought experiment. >> could you see donald trump winning? >> i seriously doubt it. 25 years ago this was ross perot. now he was able to get enough of the vote to spoil it for the republicans in that race. donald trump may be well be able to do the same thing here. and his continue might tilt the

whole thing to the democrats. >> could you see yourself voting for a democrat or hillary? >> it depends on who it is. i'm looking for somebody promarket and proscience. it is hard to find a candidate promarket and proscience. so that is what i'm looking for. >> hillary doesn't do it for you? >> she has strengths. it is not clear she's a big believer in free markets. >> great. good to see you. melissa, back to you. >> thanks andrew. tell marc hi and "fast money" is a national show. we're national. thanks andrew ross sorkin. all right. a lot of fascinating stuff in the interview. but a couple of tradeable aspects would be the tact about artificial intelligence and as well as drones. so where do you want to go grass? >> the name i spoke about arrow environment is a drone play but can't make a play. it lost 23% of the value last

time it reported. bounced about 12% and has more room to the upside. but facebook that is the way you play vr oculus. i think they have a huge future in front of them. >> and what do you think we're going to see drones everywhere. >> my first thought is ups and fedex. does that supplant them or do they become a drone fleet where they supply the drones. i don't know. but that is meaningful change if that is the way things were delivered. >> less labor costs for sure. >> fewer people around. >> like you. >> which is terrible for me. my tenure at ups was fantastic. >> an hour? >> and we have stock footage back at e.c. amber ella. it sold out like it has it. has been cut in half over the last year from 120 down to 60. but it is not crazy expensive but it has a huge short interest. if you are looking for something on a flier -- >> ha ha ha so clever.

>> wasn't listening. >> i would add that marc andreeson is a famed private investor and for us how do you play ai or vr or drones it would not be in the public market right now but in the next cycle. he said in ten years we're going to see drones that is a coin flip. but there are so few ways to invest i don't think buying facebook for oculus with a $260 billion market cap which is $5 billion be lee ge right now is the way to capture the next trend here. >> the only way it is tradeable right now is to buy stocks that have won in the market place. if you are waiting for the next ten years, you are not invested. you should go home. no you should just go home. >> they would be a good idea to go home from facebook with a $250 billion market cap. >> still ahead, two players in the fats sport coming under fire after a scathing report said the

employees are gaining on the system. we have the details when we return. you're watching cnbc first in business worldwide. here is what else is coming up on "fast." >> need a side of hash browns with your big macor an egg mcmuffin after 5:00. no need to fear. all day breakfast is here. and will it get investors loving the stock for good again. the details when "fast money" returns.

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tough day for tesla kicking off top trades tonight, falling 3.5% after morgan stanley cut the price target on the stock to $450. that is down $15. the firm commenting on the model x saying it is far too pricey at $132,000 a pop. they say while the model x is compelling demonstration of the firm's engineering capabilities we think the high sticker price makes 2016 volume targets difficult to achieve. the firm is keeping the over weight rating on the stock and we should know that the lower price target is the highest on the street still. >> i have a problem with the price targets when they come in from $465 to $450. >> with an over weight rating on

the stock. >> and they have three cars they are going to try to produce and i think they've had their hands full with one car and now two cars. i don't think you are a buying of tesla. tesla, at these levels and it is inconsistent to say they are worried about production and bring the target price from $450 from a stock price of $239. >> and the way i think about this this is a great company and they are making great cars and you are not going to grow into this valuation until they get to the model three which is the mass market thing and do some things with stationary storage but we won't know that for a while. would you be nervous about holding stock here the way we see high valuation stocks. and we've seen it in sectors of technology. that is the risk in the near term. it is probably market and misexecution. >> karen? >> i agree with steve. i don't know what the value add. a $15 cut on something that is

up 80% from last year. >> in 2017 and 2018. >> how could they have a sense to fine-tune it that much. that tightly. it looks like a cover your -- kind of thing. are we allowed to say that? >> no i've said that before about this particular -- the coverage of this particular stock by this particular analyst. so -- >> well to make comments make comments. leave your price target the same or make a significant change. i mean -- what is that -- i can't do the percentage. i didn't go to a good school like you. that is less than 3% change --ish. >> close. >> big day for egg mcmuffin fans. can you eat it any time of the day. but there is a catch. not every single store is offering all day breakfast. options may vary. but what is known is the hash browns will be available at 90%

of the restaurant's all day long. >> great news for me. >> guy? >> great news for a number of different products i won't get into. but mcdonald's made a 25-week high. tim has been on this. and it did make a 52-week high today. and the yum news does not help. this bounced up again in 2012, it topped up and in 2013 and 2014. it leads one to believe. will the yum news take the wind out of the sails of mcdonald. if you are have been long on the stock, you have to do something. you have to take money off the table. because the stock has failed now four times in four years. >> why would the yum brands news and things were fine in taco bell, it was china specifically. >> you know this is the way it works. it doesn't mean there is correlation other than the fact they are in the same universe. >> and it is a buy on a

discount. >> but you might get the discount back down. >> and listen to karen's point about the valuation of yum. mcdonald's is excepting growth that is optimistic. the declining sales. the sales have declined in the last three years 10% from 28 to $25 billion. so yes, there are things working here but you don't have to buy the stock back at all time resistance. >> and it is down 2% in the after hours session. coming up adobe falling hard after hours. and latest from the company's conference call in a moment. and dennis guardart man is here. he has one of the most bullish calls. we'll have more after the break.

welcome back to "fast money." crude oil hitting a two-month high today. up nearly 5% and dennis gartman said it is now time to buy. dennis is the editor of the gartman letter and joins us here. always good to see you. >> always good to be seen. >> why do you think we've seen the worst for oil. >> because if you watch the term structure of the futures and i talk about this all of the time on the show you have seen the term structure, the con tango

narrow. crude is no longer aggressively bidding for storage as it was six or seven weeks ago. the one year con tango was narrowed into $5. it tells you there is greater demand or lesser production or both. you made a low under panic. market came up from the low and stopped and went sideways and is breaking on the upside again. so i think we've seen the last of the lows. >> and we had a suggest a couple of weeks ago to rate on a scale of 1-10, a bull-ometer, so how bullish are you on a scale of 1-10? >> if you asked me that four days ago i would have said eight. but now i'll pull that back to a five or a six. we've had a huge run today. once you are a buyer of futures or uso or oil energy stocks

after today. but on any -- any small correction, any one or two day correction, you should be a buyer. >> and that extends to the equities. >> yeah, that is an equity predominant show so that is a way to take a look at it. >> and even with this run, are there technical things in the oil market that will put a floor under this for now? oil at this price? >> if you have to pick up one thing, pick up the fact that rig counts are down. rig counts have fallen dramatically. it doesn't mean anything because we are producing a lot in the bakken. production is still there. but if you need to have something. sometimes you have to have a simple idea to hang on to that is something to hang on to. rig counts have fallen and they will fall further too. >> when mexico hedged the total 2016 production at $49 a barrel that to me i sense that $50 or thereabouts was going to be the top in oil. now we've seen china come offline. which a week ago we're talking

about glenn corp and commodities. china offline for a week do you think there is a correlation between them being offline and the commodities space being able to rise wouldn't it be prudent to see china come back on line. >> and i heard you talk about that this afternoon and the equities market and i beg to differ. >> we're very redundant. >> redundancy is a good thing. >> humor me. >> no, i will argue. i'm not sure that china being offline is going to -- has allowed oil to go up on its own. i think there is more going on there than just china. i think the world changed on friday afternoon. >> yeah, slower growth. sorry. >> i'm not sure there is slower growth, okay. if you think that china -- china is not growing at 12% any longer. it is not growing at 7% any longer. but david darst has an interesting comment this afternoon when he said 17% growth right now with a $9 trillion economy is larger than 12% chinese growth at a

$3 billion economy a year ago. yes, it is not growing at 12% or 13%. and it might only grow at 5 or 6 or 7%. that is still a good impact. >> good to see you. >> always good to be seen. >> go hide behind the smart board. guy adami, we saw big rallies in oil. >> so quickly. when this show started the api data came out. it was a 1.2 billion barrel draw and looking for an increase of 1.75. that is significant. 3 billion barrel swing. so if the rallies in the after market don't hold tomorrow i think we've topped out. and the volatility measurement in the oil ring that was up today. significantly higher. i still think there is another leg down in oil. to a news alert. on adobe which is falling in the afternoon session. although off the lows.

morgan has the story back at headquarters. >> that is right. guidance lower than analysts expected and unveiling a three year growth strategy for the company. but during the financial analyst meeting which is underway right now. the ceo out lying three key trends that he believes present opportunities for the company. >> when we think about our ability to advance the state of content to harness the power of data and effectively and eventually drive every industry to enable them to deal with digital disruption, we think that is a large and growing opportunity for adobe. >> now in terms of data, calling it a, quote, flood of data that overwhelming and creating the need to collect and interpret it. digital government and business is a large opportunity for the company he said with paper to digital conversion. also that the over all, quote, the real power for adobe is that every business segment is in the midst of digital business

transformation. saying the total addressable market is now about $48 billion, what he calls a significant increase. also reiterating what he believes adobe -- that he believes they can continue to target a 20% revenue growth rate in the fiscal year 2015 to 2018 period. so when the guidance was first issued, we saw shares of adobe plunge as much as 10% in after hours trading. we can see the losses have paired back and they are down 3% in after hours. >> thank you, morgan. let's talk about this. it was only $2 off of the 52 week high at the close today. >> it was trading 85 at one point today. but as morgan said this had a $76 scandal after these comments. it is coming back. the big deal is selloff and then the stock is at an all-time high. i think it is still in tact. but they are the only game in town. regardless of what they say,

people continue to come in. >> it sounds like this is a buying opportunity. >> look at the way it trades in last hour. >> if we look at next year's guidance -- [ overlapping speakers ] >> the company is telling. we started -- >> he is saying look at the chart. >> forget the chart. forget the chart. we started talking about yum, who gave really sang win guidance in the year and they didn't hit it. these guys are telling you next year the guidance was too optimistic and it is down 15%. >> there is no talking to dan tonight, he is not himself. >> but he makes a salient point. and look at the way the stock has traded for the last three years. i encourage you all. go to ken so or something on the website and ask him. still ahead, a fantasy sports scandal rocking the industry. should it be considered gambling. the details next. and yum brands hit in the after hours session.

down about 16% or 17%. a top analyst that has a buy rating on the stock will join us to explain what went wrong. much more "fast money" still ahead.

welcome back to "fast

money." a major scandal is erupted in fts sports. "the new york times" report that some employees may have gamed the system. so what happened. fantasy sports guru dom chu has the news from the newsroom. dom. >> i don't know about guru, but do know that draft kings and fan duel are in trouble right now. and what is it? well you act as a general manager for a team and put together a team that will beat somebody else. the caveats. you are given a salary cap. can you only spend a certain amount of money and every player has a salary. and so you can put together as many people that perform well as possible. the emphasis on finding the value picks that no one els that that you have. and stay within the salary cap. and then of course here is the reasons why it is so important right now. the voefls is around who is picking what players because that might give you an edge. is it considered inside

information. that is a key. is it like market inside information and can you remedy by transparency. show everybody what you are doing. maybe that is the real sign here. and should employees of any of the sites be allowed to play these games. so melissa, so many questions here about daily fantasy and of course a lot of the guys out there, we know play these type of sports back over to you guys thank you, dom chu. >> and does this need more regulation. jason aider on the board of las vegas sans. what is the impact for the companies. i would imagine that perhaps users might be lessin kpliened to play because they think it is rigged and maybe the funding dries up. these are companies that burn cash because they have to give a lot of cash away in prizes and they also have to advertise a lot. what will happen? >> that is right. well first of all, thanks for having me. good to speak to everybody there. sorry i can't be there in person but happy to dial in by phone. but of course this is a very

young industry. this is an industry that is spending a ton of money right now in the beginning of the football season. you can't watch an nfl game without seeing draft kings, fan duel or any sporting event without seeing those two names. so they become household brands. and so this is -- i think the first challenge to the integrity of the game itself. and unfortunately the reality is this is what happens in unregulated gaming. and nobody would say with a straight face that daily fantasy sports isn't gaming. it is no different than online poker or casino or online sports betting. that is what this is. >> do you think we see investors pull out. do you think the spigot goes dry. there are investors such as networks. i don't think they want to be associated with allegations of rigging? >> look. the man thing that the

regulators do in a place like las vegas. when you play a slot or video poker machine you know what the payout ratio is. it is a game of skill and a rate-based game and important differences versus a slot machine. but at least the consumer knows they are protected. regulation protects not just the integrity of the game but the customer accounts. we all have friends that play either one and have tried it and have $20, 50 drms or 100 drms on don't. there is no way to know that the customer accounts are segregated from the company working capital. the companies are spending more to get customers than the lifetime value of the customer to the visit so how do we know the money on deposit is safe. and another thing that regulation benefits is not just the integrity of the game but the segregation of the customer accounts versus working capital. these are all things the online

gaming industry in europe does and they do very well. the online market in the u.k. and in europe is almost as big as the macau gaming market. so this is unfortunately an early industry going through growing pains but it is hard to see if regulation doesn't set in here and happen sooner rather than later. >> we have 20 seconds, jason. you're on the board of las vegas sands and you're been following this industry. is this vindication, that what is happening here for the casinos that decided not to participate or is this an opening of a door for the casinos to now get in? >> i mean i don't know that any of them look at it that way. the casino industry missed this. no doubt about it. but at this point it is here. so the question is can it operate the same way online poker operates in new jersey in nevada, in delaware and that is with full regulation and full transparency and consumer protection. the companies in europe and the

u.k., they make a lot of money, the regulated online companies traded double the valuation in europe as the nonregulated companies. so there is no reason for draft kings and fan duel to be concerned about regulation. it is proven it can be double the valuation, multiple in the overseas market. >> jason great to have you with us. jason aider. thank you. >> let's go around the horn and get the number one draft picks. we can't trade fan duel or draft kings. >> stocks? >> yes, okay. paypal. i think there will be consolidations. >> and in particular southern yields 4.8%. it appreciated if they raise rates or not. i think you bet utilities for now. >> karen? >> google. i love what they're doing with the name alphabet but i like it. but i think it will be great. >> will anybody get boos. guy?

>> with my first pick in the draft, because i know you've never seen the nfl draft because you're watching movies with sub titles. gds. i'm telling you now, sister. i got applause. >> everybody got applause. every body gets applause today. >> an analyst joins next with the details on what went wrong with yum brands. you're watching cnbc. the first in business worldwide. much more "fast money" still ahead. bob dylan. to improve my language skills i've read all of your lyrics. you've read all of my lyrics? i can read 800 million pages per second. that's fast. my analysis shows your major themes are that time passes. and love fades. that sounds about right. i have never known love. maybe we should write a song together. i can sing. you can sing?

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you need. td ameritrade. you got this. welcome back to "fast money." i'm kate rogers. shares of new skin following. they cut the revenue estimate for the quarter blaming low sales of cosmetic oils in china. they expect revenue between 570 to $575 million and down from 620 million dollarsment and shares are down more than 14%. back over to you. >> thank you kate rogers. big decline here. would you go into other skin care makers or go to other multilevel markets or like a herbalife and nu skin. >> i won't go anywhere.

but avon. but avon is -- it is three and change now which is unbelievable. but wouldn't go near it. >> okay. now back to the story of the night here. shares of yum brands tanking after delivering disappointing quarterly reports. r.j. follows the stock from morning star and he has a buy rating on it. great to speak to you. i spoke to you this afternoon before the report. your price target implies a 20% upside from yesterday's close. what is your thinking on the stock now. is it still a buy? >> yeah we're going to have to wait to see what the company says on the conference call tomorrow. clearly things got worse in china and in a hurry. the company said on august 18th that comps had a gotten significantly positive and then to see a 2% comp versus a 10% estimate, obviously the read through there is things are a lot less rosy for the chinese consumer right now. but i do think the reaction might be a bit overdone. i think there is still a compelling long-term story and a

lot of times people forget there is more to yum than just china and the rest of the business is on solid footing. the business still doing well. taco bell still one of the leaders in the u.s. qsr race so investors have to keep that in mind in looking at this name. >> but china is what 40% of operating income for yum. this is a huge chunk of business. >> sure. >> for yum. and the repeatiddy, all of you got caught off guard. the consensus was 10% and it came in at 2%. how do they explain that away. >> that is the key question tomorrow. is this macro, is it competitive and i suspect it is macro than competitive. right now i think, and to your point it is 40% of operating income, i think the question is now focusing on the recovery. is this where a couple more quarters or at this point with the market valuation under $70, i think the market is in a multi-year cyclical downturn in

this business. >> r.j., great to speak with you. from morning side. it will be interesting to see what the activists, if they do anything. what they do now. coming up next the traders will tell you what they are watching tomorrow right after this break. stay tuned. let me talk to you about retirement. a 401(k) is the most sound way to

go. let's talk asset allocation. sure. you seem knowledgeable professional. would you trust me as your financial advisor? i would. i would indeed. well, let's be clear here. i'm actually a dj. [ dance music plays ] [laughs] no way! i have no financial experience at all. that really is you? if they're not a cfp pro you just don't know. find a certified financial planner professional who's thoroughly vetted at letsmakeaplan.org. cfp -- work with the highest standard.

time for the final trade. around the horn. dan. >> yum tomorrow morning will be ugly. if it gets to 65, that is where you take a shot. >> wendys has no china exposure. they might have their own issues to contend with. but if it is sold off on yum, buy it in a dip. >> good enough for my draft trade, it is good enough for google. >> alphabet. >> looks good tonight. >> i can't do it. >> alphabet. it is hard. old habits die hard. >> a lot of feistiness on a thursday night. it is always good. >> a lot of discourse. >> adobe. >> does it hold at the 81.5 level or does it open on change. that is what i'm watching sister. >> i'm melissa lee. thank you for watching. see you back here tomorrow at

5:00 for more "fast money." don't go >> 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 crameria. other people want to make friends. i'm trying to make you money. my job is not just to entertain but educate and teach. so call me or tweet me me @jimcramer. be nice. as the hatred of the drug stocks finally meets the point where it can bring