restructuring that would satisfy investors. >> 20 seconds left will this influence the nasdaq tomorrow with the whole tech sector >> i don't think apple is enough of a bellwether for the market and give you a net benefit of the pop, in the dow and the nasdaq. >> and it would lead to a better feeling with the group and about to have a mess or a big miss >> up 93% after hours. that does it for "the closing bell." "fast money" begins righ ♪ ♪ and there you go we do start right now, thanks, will of and an earningsel bra , celebration. earnings just out. shares are jumping 3% after hours and the stock at an all-time high and inching, creeping, clawing toward a $1 trillion market cap and full team coverage and the bearded josh lipton spoke to ceo tim cook and red phone maverick gene munster here on set monitoring the conference call.

we'll check in with both of them in just a few minutes and i guess with the song, folks i am cool. this is the gang thanks for being with us here. let's get down to the headlines of the world's biggest company, apple coming in with a big beat, and growing 40% year over year and projection of $60 billion next quarter guy adami. >> yes, sir? >> your reaction and whether or not this is a must-own stock i'm not going to be disingenuous and say i've been a bullish apple bull, and i put that out there. to answer your question, given this quarter, yes, tim and i were just playing with our calculators here and service revenue now overall is 18% that continues to trend in the right way which means in my opinion, that apple should get a different, a higher valuation. i think that's what everybody wants, but what i was most surprised by and dan can probably explain this and why the average selling price for the iphones were almost $40 more

than the street was looking for and that's significant and they sell more phones so i think overall you've got to think this is an outstanding quarter. >> they sold more phones and higher priced phones in the iphone x your reaction to the quarter and the market in extended hours and we are waiting on the conference call, but right now they look the numbers and the quarter was fresh and it was so exciting and so inviting to me, brian the bottom line is if you look at services revenue that was up 31.3 and you got the quarter over quarter year numbers and it's now 60% of sales and china grew 19% and nothing about this quarter that's difficult for the market and everyone wants to blow a whole for the company and bottom line is we have another product release coming out in the fall and this is a company that's been very defensive during a difficult time in the market and good for these guys and the capital return is a part of that and a defensive story. you stay long. >> karen are you an owner of apple?

>> i agree with both of what they said. the question is what is the multiple when the revenue mix is changing the way it is to a more favorable services which i don't know what multiple it deserves and probably significantly higher than where the stock is i also don't know what is the multiple in the hardware business and that's, i think, the trickier part, but on a quarter when expectations were not that high that this was going to be an important quart e they had an outstanding quarter. so i think -- i hope that this translates to a wider tech rally even though they're completely different businesses it from the other fang names and i think that will happen and it probably will. >> making up almost 18% of the total sales and gene will probably speak to it suggesting that i'm not going to be placing a higher multiple on those services until it's 25% of the total sales, but the fact that it was up 25% year over year is

impressive and people were expecting it would be lower and the thing about margins is it's interesting and they're doing increasingly more services and there may be some issues with the hardware and we also know that as they refresh the iphone x in september the talk that they'll have a lower price point on that x. they'll also add a 6.1-inch led sort of thing. the asp, the average selling price is maintaining prices on high end because they keep doing these higher-end phones and who knows? one last point about why that asp might have been sohigh and china up 19% year over year and tim cook has ruettenly said since the iphone 10 was launched last november that this has been the best-seller on any category. >> listen, services is so key, guy adami, we don't talk a lot about it and 9.5 billion and we're headed toward a $40

billion a year business for apple probably next quarter and that is itunes, and that is some of the icloud and the cloud competing. >> it's over a billion >> you're getting scale on something even in the early innings it's on scale of an installed base of a billion phonis and think this is really, really important and we don't need the watch and the apple home and all of these things that ultimately could be part of it and that's a services revenue, but to me the story with apple is still very important. capital return, think about what these guys are going to do every quarter for the next three years. >> i just want to add one point. if you look at the other products and $4.7 billion in the quarter and that's greater or equal to ipad and it's watch and air pads and forget the home and that's beta for all intents and purposes you have other which is these wearables and you have services greater than mac combined.

>> obviously, iphone is the big one at $29 billion in revenue and the quarter and the services at 9 1/2 faceback does 13 billion in revenue, apple does as much revenue in four months effectively as facebook does from its primary business in a year this is a beast that is growing for apple. >> so why the question, that is? why doesn't apple get a similar or a valuation in the ballpark of a facebook force? i think one of the apple bulls have been why haven't we know able to get the valuation that this company deserves on top of the capital return that tim is talking about. i can't tell you when it's going get there, but at this trajectory it gets there i would imagine early 2020-ish it would make sense for everybody and karen can opine on that >> if they're read toward this

razor blade razor model by having the hardware and software, that is a multiple i wish i opened it now i hate buying things when they're up and i probably won't do anything tomorrow or in the after market, but it's a better price at these earnings than it was this morning coming in >> they brought back $20 billion worth of stock in this quarter and that was on top of the 20 billion. >> it will be 25 billion for the next three years, man. >> i think they've got to $300 billion total and that's including dividends and dollar 200 million of that were stock and they've been accelerating it in just open market participation and they think the stock is really cheap. >> the third business, if you will and we'll take out the ipad and that is apple watch and apple tv and the home pod. the apple watch has been much derided. i think it's fair to say it has not gotten much attention at

all. >> you have 15, don't you? >> there you go. that industry was the fastest growing year over year revenue for apple and the other segment grew 7% year over year and apple watch beats homepod, ipod touch and third-party accessories and apple is firing on all cylinders, guy, on a number of different fronts. >> did they break out air pods >> no. it's in the other product with the watch and air pods are new so that will come from almost a zero base, but you wonder is the watch outperforming now? is apple tv starting to become a -- >> i think when dan said beta. i think those numbers give you some optionality i don't think that's what people are basing their apple investment upon, but if you get performance there, it gives you the beta that dan just mentioned before the core of the thing comes down to services on the phone and gene can speak to the other, but to me it's what's the right valuation on the $13.25 they'll

earn next year. >> i would argue this is not supposed to be a great quarter for them if we have the tailwind of a product, this is the time the stock usually outperforms and not this quarter and to be clear, i think the stock really outperformed this quarter and we talk about it relative to the qqqs of which almost 12% of that entire index, but apple has been outperforming whether it's a six-month basis or a two-month basis to the qs and at a time when they're looking at tech and the high growth this has been the most consistent company and the iphone is arguably becoming a more predictable story and th% services is not only diversifying the revenue stream and it's starting to flatten out the volatility and the name very bullish. >> if apple's business does 40 billion a year apple's number two business is probably one of the fastest -- >> in terms of revenue, forget about the iphone in the entire

s&p 500. >> this is the report that will propel the stock to $ 1 trillion plus what i see here is a different paradigm starting to take place. it's not just about what the iphone numbers in a particular quarter and it's a broader theme and we describe this as apple as a service and there are three pieces to it we saw each of them come through in resoundment number one, stable iphone growth for the last five quarters between 0% and 5%. a few years ago it was up and down second, the services piece 18% of revenue and the stability at a higher number and third, the capital return and i think this is the piece that most investors are missing. $25 billion in total with the buyback plus the interest payments and that puts the company on track to be net cash neutral in three years and that's the piece i listen intently for if they do that, apple can move this stock 25% high or a buyback

loan i want to warn investors can double or triple based on what we see on apple as a service >> it's incredible there, too, gene i know it gets no attention at all and that business growing 37% when you factor in the watch and everything else and you know the ecosystem as well as anybody. if you have an apple tv as viewers do and listeners as well how big is that business going too ultimately become for apple? something like the tv with the box on the side is not that big, but the bigger opportunity here is how they can use their ownership of the operating system whether it's apple tv and the grow with the original content and music subs look at the recent spotify numbers and they grew 40%. by my math, apple paid music subs by 100% and clearly there's

an advantage to owning the operating system and you'll find other ways for the company to monetize that. 31% growth and march 18, and 18% growth in december of '17. so you have the step up and it's because of what you just described having this ecosystem of devices and then able to pump different services through that. it's working and i think that there's no reason for it not to continue. >> you buy the apps and it goes into the same. we'll see you in a bit and we'll let you jump on that call and we'll check in with gene munster. let's play the game that melissa likes to play, would you rather. >> she's better than you >> melissa does everything better than i you. >> it's the double as in fang. apple or amazon? guy adami? >> apple or amazon you'll say i'm crazy i'll a amazon. >> i think you're crazy, but for

reasons unrelated to the game. >> amazon. i understand valuation concerns there clearly, but in terms of upside potential i think amazon is still the one >> i completely disagree look at what amazon is doing to multiple stocks. the market blows a hole in it and listen to what gene just said the change on the change on services is actually 40% we went from 18% to 31% in a year over year so this fast-growing business is -- to make the valuation, come on. this valuation is very cheap >> why doesn't apple get the respect that you think it's going to >> because it's a hard wear business >> not anymore >> i'll grand you that >> would you rather, karen >> i would rather apple. >> i would rather apple. the highflier what tim's talking about, the highflierness of amazon and it makes me think there's significantly more time horizon. >> when you think about now and then of the year

>> do you agree with the product cycle, by wait >> why yeah. when you see the rotation and added growth out of value and this stock and company has growth and value and it's got a catalyst so to me, i don't see the stock raging out of this number and i'm very glad that this is not up at 2.05 and it could be, but it's getting harder and harder to move this thing up and if you want to play for the product psyching and you know in early september they'll tell us how many different ones and you'll have a few months and don't forget that that iphone x, that ten was released on november 1 of the and they released the 8 in the end of september and you'll have this run all fall. >> don't you agree that as apple transitions from this higher services side the multiple expands, as well. >> gene talked about services and all of these platforms and it takes a lot of money. netflix is spending $8 billion a year on original content apple will have to step up its

spending massively and every endeavor that they've had in music has been a big failure and apple music has taken them years and spotify just ran away with it for a while >> why should they have been important before >> there was no reason for them to do anything else? >> it's too little and too late. when you look at original content and video it will be a bust so if they'll be reliant to offer original content and that's a tough road to hoe >> if people think that netflix's content is so good, apple can do that, too, and how about apple splitting these two companies apart? how about hardware and software, it will be a trillion dollar company. that would be a driver. >> it's twice as big as netflix and facebook's business combined think about that >> you seem enamored >> i like numbers. we'll have more on apple throughout the numbers as well as technology overall, tim and

mr. wonderful, kevin o'leary has three etfs in that space that he says are screaming they are yelling they are high-volume buys. he's going to reveal those names. plus, from tech health to burrito health investors losing a lot of money in chipotle and the fast food chain dealing with a new set of health problems in the locatn. ts meinthe company wants to avoid right you in. we are live from the market. we'll have much more "fast money" after the break your brain changes as you get older. but prevagen helps your brain with an ingredient originally discovered... in jellyfish.

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welcome back to "fast money. outside of apple, we have two restaurant stories for you tonight. cheesecake factory getting smashed on their earnings and chipotle with another illness at a store in ohio. let's go to kate rogers. >> cheesecake factory falling, while revenues were right about in line. same-store sales increased by 1.4% and right below analyst estimates. higher fees and group medical costs increased their dividend by 14% to 33 cents the stock is down around 7% right now, but for the year it's up some 17% and on to chipotle it has re-opened its store in

powell, ohio chipotle voluntarily closed that store yesterday telling cnbc it did so out of a abundance of caution adding that there were two complaints of illness at the restaurant it is still in the infant stage of investigating possible food borne allergies. and off-premise. jefferies gives chipotle a buy rating with a $550 price target and the analyst is not changing his take on the rating given the news and also with analyst, who said reports of two sick people shouldn't have much of an impact on the company, but added that could be a pr average. >> we'll see you again soon, i hope, take care. with today's 7% decline is chipotle back in burrito heaven? >> that say scary place to be.

if the burrito hell includes a burrito blowout you better run for cover. bottom line here for chipotle. it's not a cheap stock it had a massive run and i don't think it had a massive run and i think they've done a pretty good job of dealing with this issue bryon nichol has done a very nice job cheesecake factory also had a 55% run into the downdraft and traded up before the earnings and free cash flow. >> listen, everyone is piling on chipotle let's be very clear. we're talking about one store and a couple of people saying they didn't feel well and there are big numbers being thrown out there that are unconfirmed this could be a specific story i feel just fine >> guy adami >> without the without this news story it's an expensive stock. when you put this on top of it, do you want to own it given the run from 250 to where it is now at that valuation? i say no i think you have too much headline risk and cheesecake

factory, real quake. yeah, 19 times forward earnings and this is the number that stuck out to me. last year at this time they were 8.9% >> you're right. >> that's a concern. >> you know who 86ed chipotle last week? >> aaron did >> let me ask you something though, if a month from now they were to have another outbreak at another store does that make the stock go down more or less than this one people get in there? >> it's always been one store, two sick people. >> mcdonald's had an incident last month the stock was down 1%. >> do we know if other restaurants are getting similar complaints and just not getting the media attention? >> i think that's the case >>. >> did you see the consumer confidence was massive aren't these supposed to be -- we know same-store sales was disappointing and now we have this cheesecake miss. >> i hear them talking about costs, though and this is a big

deal we're talking about medical costs and overall cost to carry employees. folks, inflation is here, and i think this is a major issue for a lot of these people and that's something to worry about. >> there are restaurants around the country that have to have signing bonuses. >> a signing bonus guy didn't even get that check or did you, guy? >> they brought me on -- >> what exactly is in? guy adamy? >> remember fast times at ridgemont high >> check out where we stand with apple right now. that stock is up after hours at all-time highs and the stock is up more than 3% and investors are liking what they hear. the stock continues to accelerate after hours and you can see gene munster listening in on the conference call with tim cook going on right now. we'll check in with gene in the meantime, here's what else is coming up on fast. >> it's important that a company's culture will not allow

for this ♪ oh snap >> that didn't age well. >> amid the chaos, the sha chairwoman said the tiffany network could be a buy while the tech selling continues one group is surging and here is a hint. >> may cause the following symptoms, gigantic eyeball and the condition known as hot dog fingers. >> we'll tell you how high some ads e big pharma going when "fast money" returns. you're kinda bumming me out clive owen. no, wait... it gets worse. we also have the age-old problem of bias in the workplace. really... never heard of it. seriously? it's all over the news. i've heard of it. ahh. the question is... who's going to fix all of this? an actor? probably not. but you know who can solve it? business. that's right.

the best-run businesses can make the world run better. because solving big problems is what business does best. and doing good is just good business. shhh! sorry. so let's grow more food, with less water. and make healthcare, more healthy. it's okay, i've played a doctor. what have we got here? let's take on the wage gap, the opportunity gap, the achievement gap. together, we can tackle every elephant in the room. and save the rhino while we're at it. because, whatever the problem, business can help. and i know who can help them do it...

all right, guys. welcome back let's throw apple up on the board again and that stock continues to gain steam as the

after-hours segment goes on. if you are just joining us and tuning in on cnbc, shame on wow. apple blowing out earnings ahead of expectations. you have other businesses like the watch and apple tv up 37% year over year as well guy a demeandami. >> in yes, sir >> there will be a day if this continues very soon on cnbc when we use the "t" word and that is a trillion dollar valuation for apple because at this rate we're getting this quickly >> we might break in on this show >> wouldn't that be great? i'll bet you a kevin o'leary -- >> there are so many zero, it says see other hat see rear of hat. >> the headlines are already written. i can't wait to see the fanfare that accompanies the $1 trillion mark >> do you think that will get attention on this network? >> just a little >> just a tad. >> from us >> i want to ask you, you've said a few times that you feel

remorse. >> yes >> for not owning apple and yet you still won't own it because you like to buy thingsings that are cheap. >> that's the problem. >> if this rotation with services and higher margin go, couldn't you make the argument that the stock with the same valuation is now cheap because the business is changing >> yes yes, and i think my problem is one of ego and not owning it if i came to it today. had no history about the stock at all and looked at the story and the evolution of the revenue. >> you bought it in the 150s in the downdraft. >> i think people forget that there have been two massive peak to trough declines in dollar value and in february into march it was 16% and from april into pay, and the fact that the stock is trading at an all-time high doesn't mean it will stay there and google, microsoft and amazon are up 2%. >> no, i'm not, actually and they gave them back. i don't think they have to chase these things at all-time highs.

>> what they said is they'll be buying back 25% of the company over the next three years. right there without doing anything this company goes up 35%. >> just on shares. >> and when the stock traded as low as 150 they massively accelerated their buyback. >> over the next three years there's going to be enough support in this stock in addition to everything we've extolled over the last hour about this earnings number so bottom line, i think it's actually a stock you can buy today and feel pretty good about. >> it's amazing and you go to -- and suddenly kevin o'leary shows up on set. we just grew "fast money" by 18%. kevin o'leary of shark tank and everything, welcome. you've been listening on this. >> yes >> you won last year on the back of apple. >> yes >> what's your take on apple >> this earn mog the buzz was so strong on beating the print on services past 30% that i -- that we put the position back on at 190.10 i was not an advocate for it

because, you know, but you've got to listen to your crew what i find so interesting in the bull/bear debate is this a consumer electronics company hardware business or is it turning into a subscription software business or is it both? you see this movie before on hardware and margins eventually get crushed. is it happening here the euphoria -- >> is it becoming less of a hard wear business? to the overall revenue mix >> i know. and yet i own it again and i'm very happy i own it because in today's return alone annualized it's pretty good we'll probably stay in it, but to me if they can keep growing services at 30% how can you not own it because it's such a high-margin business and that was the big debate they came in at 31%. >> that was a charge if you backed that out it was, like, 27 still high >> yeah, but where else can you find such a huge installed base growing and the high margin services business and that's the bull case of this. i understand both sides of the equation

will it hit a trillion i think it will. i own it again, so i hope it does >> to tim's point. i know you like two things and you like the fact they gave 25 billion to shareholders and 20 billion in a buyback and a 73 cent per share, he said. >> i'm not a fan of buybacks if you want to return capital to me, you send me the check. i'm happy to pay the taxes on my check and redeploy it back in the stock or somewhere else. buybacks to are not a real commitment and you hear about boards talking about buybacks all of the time and the commitment to not cut that dividend is very, very difficult to deal with in good and bad times. >> you talk about this new model, right the high-margin business is making up a greater percentage of a whole we're seeing elongated product cycles in the hardware that there's a good chance that ultimately, once the high-end smartphone market is saturated we'll see margins go down fairly dramatically in the hardware

space and all of a sudden you have to have a lot of spending for that services business to keep growing, right? to me there is a potential and just so you know, gross margins are a couple of percentage points when services were a much smaller business. >> that's where i was in february which is why i sold it off the book but here's where now my thinking's changing. consumer electronics have never seen a brand like this you know, i look across my family everybody has to have an apple device opini device although i could show them five other platform, they don't want it >> try to get my son to move to samsung, not a chance in hell. >> you know why? the songs he purchased on the itunes probably won't work the apps probably won't work you are sucked into that ecosystem. >> that's the buffett story why he took down for the first time in a major position in tech company and he watched the people around his office and he doesn't have an office and

they're euphoric about this device and they will not give it up for anything else and that was a compelling reason for him to take a multibillion-dollar bet. >> three etfs we should be looking at in technology are what >> it's hard to buy pure tech and pure growth. when you buy the big indexes you get a lot of hardware and slow growth and there are etfs in the market and one is my own book. ogig, fdn and iyw. a lot of people know these etfs, but here's the difference. they're all different. o, gig is international e-commerce it has all of the big names around the world fdn is a real domestic pure play you won't find apple in it and yet if you want to play apple and cisco that support the platform of e-commerce, iyw is where you go my point is you don't have to buy the big, ugly indexes anymore. you can find these really fine-tuned and i would argue with the sell off in tech is a

good way to play it with more growth coming in the first two because they are based on pure revenue growth. >> and if you like the international story that's the o gig. >> o gig is 52 names. >> ten-cent alibaba which has been ugly, too. >> yeah, they have, but one of the things you want to look at, what turns on more is pure revenue growth when you have a company growing at 20, 30, 35% generally those stocks tend to outperform the ones that are even doing better on a slower growth, but more profitable basis revenue matters more in e-commerce than anything else. >> ogig, fdn and the iy on. >> w >> iyw >> three interesting pure plays. >> did kevin say -- did anybody here like these names? >> you did point out ten cents in a rough go. >> does it make it more of a positive >> if you think that alibaba is

a trade war stock that their commerce is all about trading across borders. >> i'm an em guy and i'm a global guy and they're not resigned to just doing business. >> if you've been long the names and why not own them in one index? >> i think it's interesting. >> still ahead, apple, as we noted touching an all-time high after the earnings beat the stock and up more than 3%. fast money friend and fast money fiend, gene munster is on the red phone listening in on the conference call and he'll bring us his biggest takeaway from the quarter and cbs getting a little bit of a bid today after a brutal sell-off in the last few sessions karen says now could be the perfect time to buy the stock. we will find out why she thinks that when "fast money" returns

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>> welcome back to "fast money." cbs shares seeing a bit of a bounce today after allegation of sexual misconduct by les moonves set the stock at 7% this week. let's go to julia boorstin in los angeles for the latest on this story. >> brian, the cbs board is leaving les moonves in his post as ceo of cbs as the board selects outside counsel to conduct an independent investigation into allegations ha made in the ronan farrow article from the 1980s to the 2000s.

he respects the board's decision to hold off on any action for now. >> i'm a strong believer in les as the ceo of that company and if les were not in the seat of that company i don't think i would be in the market to buy cbs stock. >> but on news that these allegations, they're slashing cbs' tag net downgrading the stock, the added overhang of an investigation of an uncertain length with an uncertain outcome. it has an overweight rating on the company with the long-term potential and it still warns that the allegations create a near-term overhang and this comes as prosecutors say they've declined to pursue claims led by women alleging to sexual abuse and one from 1986 and two others in 1988. prosecutors saying the statute of limitations on these claims has expired. ronan farrow tweeting that these

allegations seem to be from an additional woman from the six he cited in his story separately in the battle for control between les moonves and sherry redstone, today -- or yesterday it was revealed today, national musement filed a motion in federal court accusing cbs of destroying evidence. it used a self-destructing texting system for cybersecurity reasons calling it the sony hack we hope to hear from moonves directly in the earnings call coming up thursday afternoon brian, back over to you. >> julia, thank you very much. >> karen you're saying that cbs is a buying opportunity right now give us your fast pitch. all right, yes i am saying cbs is a buying opportunityright now and i fwaut this morning so for me, valuation is always the first thing i look at. we we have a very attractive valuation and relative to its own history and relative to its peers thshgs stock is trading very cheaply right now so i also love a catalyst.

so what could be the catalyst here via com merger we're going to see as a lawsuit forms in october, maybe it doesn't get resolved right away and maybe it gets resolved sooner and they could be merging with redstone has their way. in addition, it is possible that doesn't happen that they could ultimately merge with someone else and a number of different catalysts here so valuation, that's always important. that's the most solid fundamental here so let's go to the charts. all right. so there's a few days that are really important here. here's one this was their last earnings call so they had a very, very positive call. they had a beat on revenue and they had an even higher beat on earnings and they had great growth in the entertainment and the cable business and that's very important and the fundamentals of the business are doing very well. here's another thing that's really important as well this was the day where the at&t/time warner deal got

approved and paving the way for a lot more media mergers to come and then lastly, this is the important date where we are right now. here's the opportunity from here to here that was created by call it whatever you will the uncertainty surrounding the future of les moonves. for all those reasons. put it together, i think this is giving you the opportunity to buy a great company at a very good valuation with several potential catalysts maybe in the short term even. that's my pitch. >> karen, simply, who runs this company in his absence if that's where we end up? >> i think there are a lot of executives i don't know my guess would be somebody like bonnie hammer who actually would be taken from comcast, so maybe that's not the best choice, but she's an excellent executive i think it would be good for them pr wise to have a woman in there. there are a lot of great women executives out there who i think can do it. he's great, no question about

that, but if it comes to that i think there are other people that can run the company well. >> anyone else has a question for karen on cbs >> let's vote, baby. >> are you buying karen's pitch on cbs tim? >> i'd buy that's right that's right i think that's a great call. i think the valuation is right and i still think the sector is on an upside. >> i'm a buyer with an asterisk and i think you buy it when it's less les you get it >> it's a big overhang and i think that's another catalyst for him to be out. >> i wonder why tim put a basketball on his thing, but i'm can k-fine and if you go back to last quarter and rogers said it was a $50 stock and they report on thursday and i'm with k-fine. >> that will be a big call on thursday buys around the horn what about you are you buying karen's pitch on cbs? vote on cnbc fast money on the twitter machine. we'll reveal the results later on in the show plus mora apple

another all-time high and the conference call under way. we'll tell you what the cfo had s a it has that stock jumping after hours and more fast coming up jimmy's gotten used to his whole room smelling like sweaty odors.

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20%. biogen and eli lilly both up 15%. medical equipment company thermo fisher rallying double digit these are big moves. guy, what do you make of it? >> i make of it that the space is extraordinarily cheap. >> cheap with those moves >> right after president trump had that little conversation with pfizer, the stock was trading 36 or so it sets up really well on earnings and the highest the stock has been up 16 years and best single-diday performance i don't know how long and i think they're relatively inexpensive. >> they're certainly a catalyst and argument in terms of the valuation. i just look at biotech and the earnings are starting to see improvements in the pipeline and the balance sheets are fantastic and the valuation in the market, you have to look at the ibb and it will be a great chart and it continues to be. >> all right dan? >> yeah.

just all right >> are we doing options action >> one trader made a big bet >> fast pitch. >> or as guy said it, power pitch which is a totally different show we just talked about is headed for an even breakout you can break that down for us if you so choose thank you. eli lilly is the name and this is up 10% and it was a catalyst here and massive, massive breakout and today, call volume is two times out of puts and after that 10% rally and this is a stock that's up 35% from the 52-week lows made in february and the trade that really caught my eye was a buy of 10,000 of the september 100 calls when the stock was trading at 98.65 and the buyer traded $1.79 and it was at $101.79 a couple of quick charts here and this is a five-year chart and this showed the recent

breakout and it's a pretty much a runaway breakout, but if you look at the 20-year here there are highs, all-time highs up at 109. so if this is, in fact, a new position representing a long bias here, i suspect that trader is expecting a followthrough and wants to play it with options that are relatively cheap. >> options that are relatively cheap. for more on this and option action check out the full show fridays at 5:30 p.m. apple at all-time high and gene munster said the cfo said something very bullish on the stock and it's reacting, up 3.5% we'll tell you what it is. we're live at the nasdaq in times square stick around

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welcome back to "fast money. apple hitting another all-time high after hours josh lipton is at cupertino and he has the latest analyst reaction so far. josh >> let's get some half takes from wall street let me bring you a couple. strong results with services revenue and capital returns and the highlights and guidance also strong versus consensus for q4 tom ford over at d.a. davidson telling cnbc, i think the iphone 10 taught management that when you sell smartphones more than $1,000 you don't have to sell as many units to you manage financial results and they reduce the material and

component cost particularly for the new lcd model. we think apple is able to improve margins in the second half of this calendar year tim cook just on the call here talking about those ongoing trade tensions and tariffs he said tariffs show up as a tax for the consumer they can wind up ending in slower economic growth listen to more of what he had to say about this subject with analysts >> the trade relationships and agreements that the u.s. has between the u.s. and other major economies is very complex and it's clear that several are in need of modernizing, but we think that in the vast majority of situations that tariffs are not the approach to doing that and so we are sort of encouraging dialogue and so forth. >> service is also a big topic on the call.

also apple pay as a new stat here, well over 1 billion transactions last quarter and triple what it was a year ago. cook saying we had more mobile transactions than paypal >> back to you thank you very much. >> let's get to gene munster he's been listening in on apple's earnings call. what is the most important comment or comments that you've heard from the call so far >> it's been that clearly sticks out and it's the iphone inventory drawdown and apple reduced the channel inventory which had a negative impact and they reported almost 45 million iphones and not the 41 muss percent that they reported and what that accounts to is 7% or 8% iphone growth and this would be the best iphone growth in the last couple of years and that's yet shares were trading up slightly when he came out with that comment >> guys. what do you think? >> it goes back to what karen

said if you looked at it today they'd say this is a great business and discount to what is going on valuation is compelling and the fact that they're making a new magnum p.i., don't think for a minute it's not predicated on mr. lipton and all of the times that we've mentioned him over the last six months. >> nothing wrong with corduroy short pants. you know know more than anybody. gene munster gene munster, professor, how do you grade apple's quarter? >> i would give it an a-minus and they nailed it on almost all factors here that the asp, the higher asp and the services number is outstanding and the cash backed 25 billion is net cash neutral in three years about two years faster than the street thinks and all of that very good and the guidance, better than expected and the one negative is they didn't blow the iphone number out and you can argue that channel inventory number would have been a blowout.

overall, we'll stick with an a-minus. >> it's getting there very soon. >> it's interesting, karen if it wasn't him, my apologies and he said something really smart about apple. he said why would i buy it when everybody already owns it. if you wanted to knock apple, how much more could there be when it's a top-holding if every etf and a top holding in almost every huj fund we talk about and everybody seems to already own the stock. you need new buyers. >> sorry >> i'm not karen >> yes, on the margin. you need new buyers. >> it's not like the story hasn't moved, right? >> the story is more compelling. one thing i was thinking about if the new tax law happens there are more long term gains stuck in apple than any other stock in the world. i don't know what that means for it, but -- long time holders >> yeah. >> maybe some llseers there. >> all right final trade's coming up next on final trade's coming up next on "fast money.

>>i don't know. there's so many opinions out there, it's hard to make sense of it all. well, victor, do you have something for him? >>check this out. td ameritrade aggregates thousands of earnings estimates into a single data point. >>much better. yeah, me too. wow, you really did a number on this thing. >>sorry about that. that's alright. i got a box of 'em. thousands of opinions. one estimate. the earnings tool from td ameritrade.

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>> the sound is why pfizer drug is in business psa. >> lipitor that's what you mean lipitor. >> i don't like the way it traded yesterday >> you're selling it >> that's what we're doing >> these apple numbers were are extraordinary. you're getting upgraded. apple. >> all right "mad money" 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 ramerica. other people want the make friends. i'm just trying make you some money. my job is not just to entertain, but to educate and teach you so call me at 1-800-743-cnbc or tweet me @jimcramer. sooner or later, every sell-off comes to an end. and when that happens, a day like today where the dow climbed 108 points, th