have to combine with disney or separate themselves from disney. >> bob wright, thank you very much, and by the way, bob, happy anniversary to us and to you nbc turning 30 >> it's 30 years today, i guess, and i want to say when we started cnbc everybody asked me two questions. one was who's going to watch it and how are you going to make any money? so we -- we grappled with those issues for some time, and i think we've done pretty well, and i want to thank all of you for making it as good as it is >> well, bob, we thank you i don't think sarah and i are the right people to do that, but certainly all of our thanks to you for doing that. >> you have your hand -- you have your hands on the wheels now, so -- >> we do indeed and we will continue to do our very best a privilege it is to be here our thanks to bob wright and our apologies for the upcoming show. >> "fast money" begins right now. >> thanks, guys!

"fast money" starts night, live from the market overlooking times square tim najarian, tim seymour, and guy adami. today health care getting slammed by 2% and one top technician says there's more pain ahead, plus netflix reporting earnings moments ago fast money friend and luke ventures founder gene munster giving us instant reaction and we start right there with netflix earnings, the giant beating estimates and coming in with light guidance and shares under pressure a bit after hours as we await the conference call and it's a video call which kicks off in about an hour's time so has netflix come too far too fast and as competition heats up, is this as good as it gets for the giant reed hastings addressed competition in the release >> we alluded to that last night. it's interesting the stock was up big today and maybe in sympathy and maybe it's squaring up ahead of earnings and the quarter was okay and

second-quarter guidance and if you'd said guy, what is happening with the second-quarter guidance and here it is down a few i'm actually really surprised it's trading as well as it is. with that said the conference call comes up 58 minutes or so from now, and a lot can happen, but i have to tell you, that second-quarter guidance was there about being saturated in the united states. second-quarter guidance actually speaks to that and yet the stock is hanging in there and i'm very surprised. >> it's even more surprising given the pipeline they have in the second half you would think there would be an expectation of more subscribers when you have another season of "stranger things." >> i don't think the competition matters to netflix i think they were first there and people will buy a bundle of these. >> the competition still hasn't come in the form of disney and the second-quarter guidance is still light in terms of subscribers. >> the polling says people will keep netflix and will add on disney and will add on whatever

else there is and they'll have a thicker skinny bundle, if that makes sense. i don't think it's going to hurt netflix. i think you'll have a whole bunch of these bundles >> and they'll have a thicker landscape and 560 ads guide on the second quarter starts to get to the point as you get into saturation or just look, at what point is the growth multiple for a company not really growing and the international subs, i realize there is a lot of opportunity out there. i also think the international culturally is a lot more wide open for someone like disney and to be a real competitive threat. the problem with netflix from a valuation perspective to me is significant, but the bigger issue and we don't know until late 2019 or 2020, just how much of a threat this is and now based upon how the stocks have traded and it's certainly been a trade where there's more sympathy towards disney. deutsche bank upgraded the stock going in and that certainly helped in terms of the sentiment going in here, but it's holding pretty well considering this

guidance >> morgan stanley, as well and they put a 450 price target on this thing and this is interesting because how many times have we sat on this desk and said hey, look, when there's something amiss, when we see something that's negative and the market's reading it as negative, i mean, this stock has been at a $48 range since earnings were reported and it went down and suddenly it was gra brought back up a bit and i still think there is competition in different ways and i think when we look at netflix, we have to understand what netflix is and netflix is a replacement from people that are getting away from the normal way of watching and it's an app and people are using that which is different than having to compete with what everybody wants to throw out there who they're competing with >> because of that and because they're so in front of everybody else and being willing to put all of this content out there and pay money for the content to be out there and did you notice

something that you thought was interesting and how about ten billion was exactly what it was last quarter and i think people are reading into that in terms of this company is trying to be more fiscally, understandably and something people with det their arms around. >> i think to make a really good point in term was how much do you pay for a growth company if there is not growth on the subscriber number which is everyone who is focused on >> i'll go to you because you've been bullish on netflix. >> the way that it is absorbed, this negativity is to pete's point, pretty tremendous let's back this chart up to the beginning of the year because the beginning of the year that's when netflix made most of its gains and since middle january >> you have a heck of a lot of headwinds that are coming in it's being factored in and it's being digested, but you're also not seeing the stock feel it the way it should have felt it, the

way that everyone thought that someone else is going to steal their lunch. no one is stealing their lunch there will be enough of the pie for a lot of players >> you know, the competition, i get the competition thing i still think netflix has had such a huge fresh start to pete's point that they've set it back up and the stock not get obliterated and a lot can happen over the next hour and the stock's not down in a meaningful way in a given quarter and even without disney's announcement and this time it's not and i don't understand what's going on, but to your point that's a really good design so you don't necessarily have to understand the stock is telling you something right now so the fact that it's holding in there is very encouraging. >> the entire sell side has either buy ratings or hold ratings or overweight ratings on the stock and with higher price targets. so we're talking about -- now analysts tells you -- what it tells you is that once the stock sells off, the sell side runs in and starts to buy the stock because they do have their buy

ratings on it and they have to back up what they say with what they're doing. >> they're actually going to go into the market because they have a buy rating. >> i'm saying they do support the stock which they do support the stock and they go out to retail investors, who supports the stock? it doesn't sound anything. that's the way the business was. >> when i hear the street is way overweight the stock and they're not growing to me that's a concern. as far as i'm concerned eps estimates, there actually is no eps and you have to come down. if you look at the stock it's down 50% for the all-time highs and the stock's done nothing in a year and market has gone through a difficult period and the netflix recovery is aed about recovery outside the base. >> it doesn't work for you you're more of a value >> first of all, it is working for me, steve, and -- >> how is it working the stock is up 34% year to date >> keep your scorecard and do victory laps. >> i'm trying to understand what you're saying.

>> this company is expensive and you finally have competition >> when could you have -- when could you not have said that about netflix? it's always been expensive >> can i jump in for a second? >> yes, please >> i think the good part of what we do know for a fact is they have pricing and they've been actually to show that they do have pricing power and that's one advantage. i think over time we're going to see more and more penetration because of broadband because of a lot of different reasons in terms of the rest of the world. >> because the number of broadband suppliers. >> everything will open up for them, i think and everyone talks about japan and all these different areas and i get it there are some hesitations there, but i think people are looking at that as that's where the growth really is going to be i think people stopped looking and i look atthis the way i look at the iphone for apple i think people are stopping looking at the united states as the place where they're looking. >> that's fair, but the international guidance was weaker also. >> right it's failing on both fronts in the mature market. >> i don't know that i would

call it failing and i would say as that penetration gets stronger then i think that gives netflix that much more room. >> all right let's go straight to our fast money "friend, luke munster. settle the score, gene what do you make of netflix and what do you make of the quarter and the after-hours action, et cetera. >> i'm someone who is generally skeptical about the business model. as far as the stock i would agree it was hard for me to pick up on who was saying what, but agree with the consensus that the stock seemingly wants to go higher i think that that is probably some indication in general up, growth international and the domestic guide and the international guides were majority of the subs with 4.5 and the 5 million where they're coming from and the story is generally intact and the price increases that pete talked about and those are the central pointing of the bull case and they're intact i think the piece that hasn't

been talked about in the conversation does netflix the question does net flicks have a good business model. i would argue it's not a good business model they burned $3 million and at $10 a month they would add current subs and that puts it toward the end of 2020 before they alleviate that cash burn. they can do some things in terms of making the content cost more efficient, but in general, more competition is not good for them at the end of the day, melissa, the way i would settle the score is we're talking too much about netflix. this stock is probably going to chop around here and the multiple could go up or down a little bit more competition coming and i think there are a let better places to play in tech >> what's the biggest question that you got heading into that video call >> the biggest question is maybe if they can get context around the disappointing guidance and

what led them to the disappointment and sometimes they're simply conservative. sometimes they see something else in like emerging markets and something like that. is there something more significant and the second biggest question is he talked about the 10 billion in debt what are they going to say content costs more broadly because when you start adding apple's balance sheet into the content cost, i think it's pretty easy to see how these content costs can scale up quickly so that would be my next question >> what do you see is the biggest challenge to netflix in terms of competition even looking at disney, but the current competitive landscape? because it's only going to increase as time goes on once disney comes online. >> so my view on competition on this has evolved and initially i thought people would get services and in pack, i think netflix will do well and i think

they have good market share in the u.s. and globally and i don't think it's a good stock. to answer your question on competition, the simplest way to see how this applies to netflix is the stock and the multiple and the more beside that's described either disney or apple and the more you see that, the more some of that shine gets taken off the multiple and when you have a $158 billion market cap that's losing $3 billion a quarter when that shine gets impacted on the multiple, that could be something that investors want to anticipate. >> gene, can you grade the quarter for us >> i'm going to give it a b, and right down the middle. i think for netflix a good enough quarter, if you will. i think the business is a c and that's not a question that you're asking, but give the quarter a b. >> gene, thank you >> gene munster of netflix he says he will chop around a little bit. >> what's your position? how are you managing that?

>> i'll continue to own what i own and i sold the stock and this was a pitch stop and and they sell calls against this and it was amazing the implied volatility and $48 range and we've watched this stock in an incredible rate from the lows to the highs and it's been all over the place since that time and because the implied volatility is there it gives volatility if you want to own the stock and it gives you an opportunity to create something so you don't have to puke on the down side. >> he will speak on the conference call at the top of the hour and grasso, i think gene made a good point of the quality of the miss and the reasons behind it, whether or not it was something that they saw in the corner leading into the current quarter. what are your questions here >> so you want to see what they really feel about the competition. you want to see how they feel on pricing. >> and the competition could be

broader than fort owe nite and hulu the competition is hours in the day, but i think it's more condition deucive. my biggest competition is amazon prime and i'm on both of them for all of them and there's more room for the player. >> we can access what competition is, and the fact this the stock was up after hours to me is great, this is a stock that underperformed 5% in the last couple of days when the announcement of competition came out and this quarter was a b the biggest issue i have is how does a company with a conduit be priced at 130 times. i'll stay with that, steve, until the cops come home because i haven't changed my tune. >> not being personal. anyone when his are has had a

profit -- >> i'm not smur. they've only been burned if they're short the stock. >> and they're looking at volatility and standard deviations this stock has not been a good stock year to date >> it's not up 54% >> we are down 42% all right, guys. i'll blowing the whistle and we'll bring you more on net tliks anetflix. >> just when we thought this megadeal was nearing the finish line t-mobile and sprint faced pushback from the antitrust staff and that according to dow jones quoting sources. staffers from the justice department have reportedly told both carriers that it the deal may not be approved under its current structure. in the past, critics have worried about the impact of this deal on competition and prices as the combination of t-mobile and sprint would take the telecom market from four to

three major wireless carriers, but the companies have often argued in the past that together they can offer their customers more options and work on faster, 5g networks. cnbc received a no comment from sprint and t-mobile and potential impact, while competitor verizon is also trading down in after hours. melissa, back to you. >> seema modi back in the newsroom there are questions what would t-mobile and sprint do next and in terms of the competitive landscape with more player, there's probably more price competition and that's yet other carriers are down, and i know this sounds counterintuitive, but the more players are out there the more likely they're to cut prices. >> if you read the wording as currently structured which is interesting. i would look at and say mine this 9.5% sell-off in sprint is an opportunity i don't think this is necessarily over and for me, i know t-mobile is down four bucks and i get it and sprint's down more percentage wise and i would

view this as an opportunity to buy sprint i do think in some way, shape or form this probably does get done >> you have at&t and what does it do to at&t if anything in. >> i think there's an enormous headwind in the performance of at&t's stock because of the cellular business and there's no directv and the cash flow elements of that business and the trends over the last three quarter have been great. as you said, maybe they've us sprooed spr introduced a more predatory landscape and i talked about this yesterday and i won't waste your time today, but the sum of the parts on this company is very interesting >> i thank together i agree with that statement that we announced the story that together they offer more of a competitive nature and landscape to's verizon or an at&t so it's counterintuitive. >> so you actually see them -- you think the industry is better off. >> think the industry is better off with these two merging because i don't think independently they can compete

and with the monopolies that verizon and at&t have. >> do you read through to this and read doj cracking down on these deals? maybe the deals are hard to get done >> i think there are some that will be in much more scrutiny. we've seen deals fall apart, and some very big deals fall apart and i don't think this is totally shocking to see this happening and from a competit e competitive, and i think this will make it a better competition. >> the semis closing at a new record high today after qualcomm and apple settled their royalty dispute which sent qualcomm shares soaring and our josh lipton is in san francisco with the details. >> high drama in a courtroom in san diego and right in the middle of opening arguments before the jury, apple and qualco qualcomm burying the hatchet and putting an end to what we know was a long and very nasty legal

dispute between the two tech giants and it dismisses all litigation and it will include a one-time payment from apple to qualcomm we don't know how big a check apple is writing here. the companies reportedly reached a new six-year license agreement and a multi-year chipset supply agreement. that combination of licenses and chips will add an estimated two bucks to qualcomm's eps. this trial was important for both company, but we know it was especially so for qualcomm because it did drive right to the heart of its business model. qualcomm sells chips and it also licenses patents for a royalty and the price for each device and we know it was bread and better and what some analysts have been removed and qualcomm investors clearly breathing a big sigh of relief here, melissa. >> josh, lipton in san francisco. so that chart is up in the

after-hourti afte after-hours session. >> pete, you have the trade. >> lucky trade in the beginning of march we saw absolutely monetary paper coming in and we talked about this a couple of times on the show where everything has been very, very short term and this is ton trade trade that went further, and it was the july calls that they were buying in qualcomm, but they bought a huge size, mel, the stock was trading under 60 at the time and you can see this monstrous move since that time those calls have absolutely soared to the upside i had to get rid of the calls and i still own the stock right now, but i think i'm going to get rid of the stock, and i love this move and that's great for qualcomm right now, but i don't know how long this is sustainable and can qualcomm be the competitor they needed to be in terms of where i want the chip exposure. >> what did you make about the

semis? >> if you look at places where the market has come back and exceeded where we were at the highs and look at the semis when we went into this downdraft. you're up 43% in 77 days o semis and look at fedex and transportis and think they're saying the same thing. >> coming up, check out shares of united and the stock is jumping after the earnings report and we'll tell you what wall street is saying about the quarter and a number of healthcare insurers are sinking and what the ceo of united said that had investors, and the man who built the largest seller of joints, lowell herb. we'll here to explain how he's cashing in on the cannabis craze. we are live in times square. much more "fast money" right after this from finding out what's selling best... to managing your fleet... to collaborating remotely with your teams.

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welcome back to "fast money. we have phil lebeau here on set breaking down the earnings. >> stop! >> it's not just that united came in 20 cents better than expected it's what they said about their outlook. three things that are going to stand out when you look at united for their outlook, second quarter and full year. first of all, reiterated full-year earnings guidance, $10 to $12 a share and that's the first piece of good news and the second piece of good news is when you take a look at what they're saying about both revenue per available seat mile as well as their thoughts on the second quarter and the full-year capacity growth. they're trimming their capacity growth 4% to 6% was the previous

guidance and now it's 4% to 5% and some of that is the max and there are also some other issues that said you know what? we're just not going to fly as much all of that if you were an investor and all of that is good news and that's the reason why in addition to them beating the street the stock is up >> do we have any colors to -- i mean, the trimming -- no well, yeah on the max >> nothing he put out a video statement after they reported earnings and he does a conference call in the morning and that's what i really want to hear because there will be direct questions and he didn't even mention the max in the vid wro tonight. nothing about the max. remember, they're the least affected of the three u.s. airlines that fly. >> is there any concern that part of the trimming capacity is because the demand might not be there? >> i -- i don't think so i -- i'm still based on what i'm hearing from everybody in the industry, i still think that the demand is solid. i'm just not seeing, you know usually you hear people saying i'm not really crazy i'm not hearing that >> so, phil, in fact, from what i'm hearing is the demand on

business and the full fare are sky high >> so the great news to me is the capacity issue, because a year ago united scared the you know what out of us, do you get the sense that the rest of the airlines caught this religion and united is the one that seemed to have fallen off the wagon and they seemed to have set the table again. >> think the rest of the industry has i don't know if they totally got the religion on capacity, but i think that discipline. i'm surprised it has remained as disciplined as the industry has in the last six months i thought that this was where we would start to see cracks show, and you'd start to see edging higher here and there in capacity and we just haven't seen it. >> obviously, they all traded ridiculous valuations and i think united seven times because it is cheap, ridiculous cheap, just to clarify, but this is sort of a question for you they give guidance, but guidance, $10 to $12 for this year 11 to $13. it's rather wide and i understand the nature of the industry and i guess my question, should they even

bother and if they didn't, might they get a better valuation? it's just a question >> great point i don't know if they would get a better valuation i think that that $10 to $12, i think what they're trying to show people is look at what we had in the first quarter you had the polar vortex canceled a slew of flights >> the government shutdown at the end of it you had the max and that was very small and then you had their flights to india being curtailed because you can't fly in aerospace and a lot of issues with that. you put that all together, and there was plenty of turbulence there and what they're saying is even if we don't have the max this summer and even if we're going to see a few other things that might weigh against us like pakistan and india, we believe that we will be able to deliver what we said >> phil, good to have you here on set >> phil lebeau pete, you are still on the airlines here. >> united's one of them and timmy has been all rover there

it's too cheap i love what we're hearing about capacity and cutting that down that was huge for me, so i'm still holding. >> again, the conference call is tomorrow morning so that's going to be worth watching still ahead, check out where we stand with the other after-hours movers and netflix and ibm both in the red and we'll bring you the latest in the quarters i'm melissa lee and first in business worldwide and here's what else is coming up on fast. >> i don't feel so good. the health care sector is looking sick and the ceo of one of the largest healthcare companies just said could be about to spread the disease. we'll explain. plus -- >> anybody want a joint? >> as weed week rolls on, the ceo of one booming cannabis brand tells us how his company nnisoming out on top of the caab craze there's much more "fast money" still ahead. at simple things that are unnecessarily complicated. but you're not mad,

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welcome back to "fast money. united health getting crushed and the ceo coming out with fighting words on the company's

earnings call. >> the hotel discussion being discussed with these proposals that would jeopardize the relationship people have with their doctors and the ininherent cost burden would have ay is vary impact on the economy and jobs all without fundamentally increasing access to care. >> those comments took down the rest of the sector with anths em, cigna, humana, all plunging on the day healthcare was the best performing sector last year, but what a different story it is this year and it's the worst performing sector? is healthcare -- >> it's a bipartisan appeal to the nation everyone hates health care and everyone hates health care cost, but i believe mr. whitman will be proven right, but it has a long road of headwinds and you're in for more volatile

action in the price? our next guest says there may be more pain ahead in the health care sector. let's go to chris verrone at the plasma. >> if you look at the last several months and what stands out as the broader market has grinded lier you've had a series of lower highs for the health care group when you look at it in relative terms it's been a story of risk on, risk off when the market was risk off health care worked in the second half of '18. when the market's been risk on, health care has underperformed and it leaves us in relative terms versus the s&p, precisely where we've been over the last year so let's look internally and let's see what's going on under the surface, and i think what's most important here, the percentage of health care stocks above the 200-day moving average continues to decline so internally the setup's getting weaker even as the stocks here have gone sideways and just 50% of the group above

a 200. so when we look at how do we play this at the stock level, certainly unh and one of the weaker names in the very, very short term it can bounce here at the 240 level and we're a searle ller o rallies because of the long multi-year uptrend that's been in place and when trend is down we sell rallies. when we look at a name like eli lilly lil' and this has been one of the winners in the group and with the sector deteriorating is there a risk for lilly it's still ten bucks above the 200-day moving average at the same time it's relative, and it's starting to peak versus the s&p. so the name, still risked back to the 200 and that's about $ten lower and is there anything we can own in this sector there might be some by tiotech that's getting better. and this is alexion over the last several years and it's been basing around the 140 level and

as the rest of the sector has gotten worse and this one is quietly starting to turn up and this has been the anti-defensive name and it's an otherwise weak sector >> come on over, chris of kn evan will bring the chair over. >> great music >> it's growing on me. >> is it our own >> it's free music.com and picking a tune something like that. so -- so just the overview break it down within the sector. you like -- is it as easy to say biotech yes, insurers no >> there's signs of life in the biotech in a risk on market that we may want to entertain, but when you look at hospitals and you look at insurers and pharma that has probably run too much here, it's a sector that's deteriorating and it's certainly oversold and we can get a bounce over the last couple of weeks and we sell rally in downtrends and there's a lot of downtrends in the sector. >> does it matter that it was

the best performing sector and does it make this rollover more convincing, but you know, it had the big run last year. >> i think it speaks to the idea that the market broadly is trading on risk on and risk off backdrops. we have all of the rick-on cyclical groups firing on all cylinders. >> and china is getting better and autos are getting gbetter ad health care and it's starting to price in better growth i'm not sure i want to own health care. i don't want to own utilities and i don't want to own staples. >> chris, let's not confuse chris using the middle finger saying to draw. >> why do you have to bring that up every single time >> bad joke. bottom line, i guess that's my point, and are you looking at the contrarian indicators luke staples, for example, which has actually been reasonably, you know, i would say performing in this environment despite the risk on? >> i thought one of the great contrarian signals is the imf downgrade in growth.

everything we look at says growth is getting better here, copper up, iron ore up, china up, i don't want to own defensive yield proxies in that environment. i think the world is get being a better call is still under owned and it's one we want to embrace. >> i'll connect the dots and bank of america and merrill lynch had their flows survey out and said the most crowded trade is the -- the most crowded trade right now is short europe. >> right >> we should be pricing in growth in an upturn in growth, is that going to just -- are those people going to be crushed in this trade? >> we think it's crowded to be negative on europe we love it here. look at the daimlers and the continentals and these things were down 50% last year and they priced in a lot of bad outcomes and look at the european luxury names all getting better and this is where we think you want to find risk on exposure this year going forward >> when you get less risk prone in the markets, do you look at the s&p to dictate from top down, 50,000 foot up macro versus granularity or do you

look from the bottoms up where you start to see the utilities and the staples and start to rally? >> we look at leadership relationships. we look at discretionary over staples. what's better? >> we look at copper versus gold what's better? copper that dictates how our call is from here. >> good to see you >> chris verrone, guy? >> let's talk about unh very quick. the stock is up 28% and it trades in a valuation and great american company and the quarter was fine and not only was it fine, and there was a raise and people are shooting first and asking questions later because somehow they believe that magically things are going to change i still say buy the weakness. >> i would agree with guy. >> and by the way, unh, great company, gotta love them minnesota. >> by the way. >> more on the healthcare go to trading nation.cnbc.com. check out shares of ibm. the stock has been on a tear all year we'll tell you what's driving

this move. weed week continues on "fast money" and we'll talk tohe t ceo of a company bringing luxury to the cannabis space much more coming up next you've worked hard to grow your wealth. make sure you're working with a wealth manager who can grow with you. cfa charterholders have the investment expertise to unlock opportunities other advisors might not see. learn what a cfa charterholdr can do for you at therightquestion.org

welcome back to "fast money "qwest we ha we have an earnings report on ibm. deidre boaz has details. >> ibm is struggle toing shift the business and putting the focus clearly on cloud

investors are very eager to hear how it plans to incorporate the company especially as its organic cloud growth slowed this quarter. on the earnings call jim cavanaugh, the cfo telling investors how they're getting parts of the business ready. have a listen. >> we have a strong foundation for the addition of redhat together, we will be ideally positioned to help our clients shift their business applications to hybrid cloud while addressing the issues i just mentioned around portability, management consistency, security remaining open which avoids vendor lock-in. >> just for fun, guy, i've been keeping track of how many times ibm mentions cloud ask rnd red t and the cloud, 1600. ibm still up 25% on the year what now, grasso >> i don't think they can compete longer term. they're trying to turn around a legacy business and trying to add that cloud into it, but year to date they have outperformed

microsoft. they have outperformed amazon. that's a tremendous feat so i'm going to give them tailwind short term, but headwind longer term and i wouldn't be a buyer longer term and i think you would get this pop to continue for probably the next couple of months. >> what i like longer term is the red hat issue. between that and cloud that's what they're talking about hybrid cloud is what we're talking about when talking about red hat. i still go back to october and stay best acquisition ibm which is a serial acquisition stock, best one that they've ever had in the history of that company. >> is that saying a lot? >> i'll throw a debbie downer on this the three consecutive quarter of revenues that are lighter and if you want to look at the chart you have a possible downtrend from february of last year there's nothing about the cloud business to me that's growing margin for them. it's, in fact, becoming much more commoditized and i figure there's the cloud and there's a lot of growth there and competition, as well >> what's that game we play

when -- >> would you rather? >> faded >> fade it, and we played it recently and ibm was one of those names. >> yes, it was. >> and he wasn't here. it's what he said the other day was rolling around in my head and he said pete's in your head because he mentioned red hat hail mary without question tim's right, in terms of margin, but their margins are hanging in there and this is a quarter, six months ago that they report. the stock is down 10% and it's not which i find really interesting. >> you're a convert. >> i'm a convert >> a convert >> right i'm a convert. >> is pete still in your head? >> no. he's right there, he doesn't have to be in my head. >> still ahead, it is weed week on fast money and we'll talk to thman bringing the cannabis cafe to a corner near you. more fast right after this

welcome back to "fast money. weed week rolling on here with the latest boom in a budding boutique business and cannabis, lowell herb company is the pre-roll packs with 30% market share. we are joined by david elias, the co-founder and ceo of that brand. david, great to have you with us >> thanks so much for having me on the show. >> what do pre-rolls cater to? are people just too lazy to roll their own joints to get high

>> well, definitely there's some of that, but really, if you think about the industry for the longest time cannabis consumers have been getting their cannabis in a plastic bag in our case we were looking to elevate that experience and to your point, make it a lot more convenient. >> i've talked to a number of budtenders over -- >> very nice. >> doing research out there, and they say that this actually caters to the new demographic, the people who may not be regular user, the people that may be new to this, the people who want the sort of a luxury feel and the people who can spend the money. is that what you're finding with this the feeling of the packaging is very different from a lot of others >> thanks for that we love that you refer to it as well luxury, but what we've focused on is mainstream and we've created a beautiful product with attention and we source the flowers from the best cultivators in the state and

cultivating with organic methods for decades and we put a lot of care into both the packaging and the actual cannabis in the package. >> right now you are in retailers such as medmen and do you see a time when you go direct to consumer is that a business model >> we are very excited to bring up the direct model. we believe the opportunity to go direct to consumers will be a big one for us especially in california where you're talking about the largest cannabis market in the world. >> welcome to weed week. you talk about brands and talk about some of the people and the multinationals that people think will be getting into this industry you guys have gotten out first why do you think you can hold your own against whether it's big tobacco or people that have the distribution and have, you know, maybe not as beautiful a pack to lay on the table as you do, but they have certainly done this before. talk about that. it's a great point that you

bring up and while we're mindful of the fact that there will be real competitors entering the space in creating brands which i've had the fortune of doing for a while and we consider ourselves blessed and proud of what we've created and we don't think it's something easy to create like a hit like when we have with lowell is not something that can be simply manufactured if you think about what we have to do to keep the brand where it is today, you know, the reference you made before about bud tenders and you go to the store and talking about products and you're learning about it, the budtenders they do love the product. they speak about it and i think that the love that we've seen for what we've created is not easi easily replicable. >> david elias >> you are just doing research >> nancy reagan generation yes, research. the bigger product on cannabis

and in terms of the placement and the direct to consumer is interesting because a lot of dispensaries are run and operated by those that also have -- they sell their own brands >> yes two weeks ago you saw the labs bought argen house and

welcome back to "fast money" time for some options action morgan stanley is one of the last to report tomorrow. mike ko is in san francisco with all of the action. >> hi there. morgan stanley is implying a 3.1% move and that might not sound like much, but as you point out it's one of the last banks to report and it's averaged over the last eight quarter and above-average volumes one of the trades i saw was a purchase of the april 46.5

and what it look said like to me was someone rolling a position up to the 46.5 puts. they spent about 50 cents to do that and that would be bearish that it will fall below the 46.5 put stripe and i would point out that those 44 puts that they were rolling up from, they initiated only last week it looks to me, so i think what's happening is they might be hedging a long position and the stock's been getting away from them a little bit as it's risen more than 10% since the end of march. >> guy, what are you expecting out of this? >> disappointing i thought goldman sachs was disappointing and morgan stanley was the same and the price actions is staple and action same and it went from 37 to 47 and that's the biggest move we've seen in the stock in the last 18 months so i do think the numbers will be okay to slightly not okay and the stock does a back and fill back to 43. >> the rally shares were pretty impressive. >> i tend to think money center banks are okay and we're back up to 260 to 234 and that has a lot

to do with it. >> options is off and catch us at 5:30 eastern time next up, a final check on netflix as the company's earnings call is five minutes or so right after the break stay tuned see that's funny, i thought you traded options. i'm not really a wall street guy. what's the hesitation? eh, it just feels too complicated, you know? well sure, at first, but jj can help you with that. jj, will you break it down for this gentleman? hey, ian. you know, at td ameritrade, we can walk you through your options trades step by step until you're comfortable. i could be up for that. that's taking options trading from wall st. to main st. hey guys, wanna play some pool? eh, i'm not really a pool guy. what's the hesitation? it's just complicated. step-by-step options trading support from td ameritrade

is this ride safe? i assembled it myself last night. i think i did an ok job. just ok? what if something bad happens? we just move to the next town. just ok is not ok. especially when it comes to your network. at&t is america's best wireless network according to america's biggest test. plus, buy one of our most popular smartphones and get one free. more for your thing. that's our thing.

we are just about a minute away from the video call in which reed hastings will talk about the quarter and netflix shares are down by 0.6 in volatile after hours >> again, i'll say it again, i'm really surprised that the stock is hanging in as well as it has the given the 3% move and the guidance it gave historically that guidance would knock the stock down which i think if you're bullish in netflix is extraordinarily encouraging. >> this call will be key. >> without question. >> final trade time, pete. >> because i like red hat so much and that acquisition. ibm. giddy up, i think she's going back. >> tim. >> great to have phil below. >> on set! >> talking as he does he got me fired up united airlines. ual. >> steve >> just spoke about netflix and the final trade. i think it moves higher, know your risk tolerance and use today's after-hours low to exit the trade if it goes south.

>> guy >> no o.a. on friday >> that's unfortunate, but we'll get back next week without question you know what else will get back in my humble united? >> pete, say it. >> unh comes out see you tomorrow at 5:00 for more "fast . my mission is simple, to make you money i'm here to level the playing field for all investors. there is always a market somewhere. i promise to help you find it. mad money starts now >> hey, i'm cramer welcome to mad money welcome to cramer aamerica i just want to make you some money. my job is not to just entertain, teach, put it in context call me, 1-800-700-cnbc or tweet me you have to admire the resilience of this market. dow gained 68 points what sta