callous against further headlines in that direction just because that was so extreme. >> it was that and also the threat of -- and follow through of new tariffs >> on both sides >> both sides. >> guys, thanks for having me. >> thanks for being here i think wilfred's back tomorrow. >> good stuff. >> from his four-week vacation >> that uz does it for us. >> "fast money" begins right now. >> live from the nasdaq market site this is "fast money." traders on this very important day with tim, bryan, mark, and carter will join us momentarily. the headline what a difference a few words make stocks rising, surging as president trump says that china wants to make a trade deal so how are traders trading all the twists and turns over trade? we're going to take you to trade school straight ahead. also, lyft, getting a lift today following a big analyst upgrade so is it time to put the pedal to the metal on this beaten down stock? we are digging in on all this

and more importantly what you should be doing or not doing around it. we begin with big breaking headline shares of johnson & johnson are higher after an oklahoma judge ordered the company to pay $572 million for its role in the national opioid crisis however, that number, $572 million, far less than some expected meg tirrell is live outside the oklahoma courthouse where that decision was handed down less than one hour ago. meg? >> it may not sound like a positive headline but j&j stock is not reacting that way the judge found johnson & johnson accountable for creating the state's opioid epidemic, saying it created a public nuisance but they were ordered to pay $572 million. now, the state had asked for $17 billion over 30 years. now, that $572 million accounts for one year of what they call an abatement plan to try to fix the opioid crisis here in the state. they're saying here in the

42-page decision that the state didn't provide sufficient evidence of the amount of time and cost necessary beyond year one to abate the opioid crisis so that's why you're seeing $572 million versus the $17 billion that the state asked for. wall street was looking for $1 billion to $2 billion so that's why you're seeing these stocks move so much, not just johnson & johnson but other drug makers like teva, endo, drug distributors moving a little bit as well. bergen, mckesson, cardinal health so there's a lot on the line here. we just heard from the spate attorney general, mike hunter here, calling out johnson & johnson's ceo directly take a listen to what he said. >> johnson & johnson is a member of the business round table, and i am asking a ceo of johnson & johnson, alex gorsky, to put his money where his mouth is and get out his checkbook. >> reporter: now we are hearing back from johnson & johnson too which says it will appeal, saying that janicen did not

cause the opioid crisis in oklahoma and neither the facts nor the law support this outcome, saying in a more full statement that they are asking for the payment of $572 million to be staid through their appeal, the process they think is going to take into the year 2021 they said this outcome shouldn't have any impact on the thousands of other cases that are pending around the country there are more than 2,000 consolidated in federal court in ohio that are set to start this fall and they says that all options are on the table for that, including a potential settlement and that would mark a difference in the way they handled this case where they said in their opening statement when you're right, you fight they fought this one but there's a lot more on the table coming up >> meg, thank you very much. guys, let's trade this tim seymour, your reaction >> bryan, welcome. i think for j&j, you have two litigation overhangs, talc is one, this is the other one, this is a victory, i'm sorry, for a company unlike endo, this is a company that has plenty of

resources to go after that more importantly, if you get to the j&j story, it's a diversified story, consumer products in addition to pharma this is a company trading at a massive discount to its peers on a sum of the parts basis and while that never really is totally a linear exercise this is an interesting moment for the company. >> i think what tim said is really important here. this is against j&j. the other cases coming up in ohio, that is against multiple different defendants and these defendants don't have the same type of resources or diversification that j&j has so as a trader, i would not take this move in j&j to mean anything for these other companies. the only thing it probably means is wall street is expecting around a billion dollars, this is $572 million so if there is a judgment, it's less expensive. >> it was a $17 billion ask. i mean, let's -- that's a big discount >> this is 96% less than sort of the peak of what it could be but let's be clear i mean, nobody around this table is an attorney we've got other things -- do you

worry, mark, that yes, this may have gone favorably for j&j and its shareholders but you think about big tobacco, $268 billion national settlement that took decades to get to. >> yeah. >> is there too much risk to own j&j? >> i don't think so at all this thing's dirt cheap. it's trading at like 14 times forward earnings right now huge valuation discount to where it normally trades as tim mentioned, it's got a great diversified revenue base from medical devices to pharma to consumer. i love the stock i think this was a great win for them so far. i mean, they're sued for $17 billion, they get ordered to pay half a billion dollars, not a bad deal for them right now. >> this is a stock that, forget act talc, forget about opioids, hasn't moved in two and a half years, it's the same price as may of 2017. >> correct >> i'll say this, though, brian, it went from december 2015, from an $85 stock up to $145 stock

before it ran into the talc issues so to me, in a market where you have uncertainty around growth, people reaching for more defensive plays, this is a little bit more of an avenue into johnson & johnson. i hear thaw except that relative to its peers i like the valuation and this is where the market is rewarding companies in that overall risk description. >> if you look at how it traded, though, $130 is basically the breakdown level from the other day so you're bouncing up what is now resistance, it was support in a stock that's gone sideways it's gone sideways in a big range but i think there's better places to be plus you have the overhang of multiple different suits so yeah, was this good today? if you're in it and got it right, sell it and pat yourself on the back. >> this could be a catalyst to propel the stock a little bit higher great, great valuation at these levels, love the stock, nice defensive play and defensive plays have been working, right i mean, healthcare not so much but defensive plays overall have been working and i think defensive plays continue to work

until we get a trade deal at some point, which who knows if that's going to happen >> let's note that half the after hours pop has already deflated out of the stock, was up 4% 20 minutes ago, j&j now up less than 2% let's turn now to the other big story today. the market president trump giving the markets a shot in the arm after he said the u.s. and china are, quote, getting back to the table on trade talks president making those comments at the g7 summit as it wraps up in france. eamon javers is there live for us and he's been there live throughout what has been a headline twist and turn over the last 48 hours, eamon. >> reporter: yeah. been a fascinating time here in frangs what a difference a year makes and what a difference a weekend makes. you remember last year at the g7, the president left, taking off on air force one, angrily tweeting about the hosts, tweeting some insults, a real wipeout of a g7 last time around this time, an entirely different tone, the president tweeting on his way out the door, thank you,

france, a very upbeat and happy tweet that really jives with the unity message the g7 was trying to send here this time around so a success there on the diplomatic front and then what a difference a weekend makes in terms of the donald trump that we saw on friday, again, angry, tweeting, imposing tariffs on china, the stock market, wipeout that we saw or the stock market selloff that we saw on friday, today, though, this is a president who's making positive noises about china, saying that he wants to get to a deal, making nice with the european union and today offering us some insight into his thinking process. he was asked if this roller coaster that we've seen in financial markets is a result of some of the president's statements, if he bears any blame for that and he said ultimately, no this is just who he is here's how he said it. >> the way i negotiate, it's done very well for me over the years and it's doing even better for the country. they don't have the wisdom to

know that you can't continue to go on where a country is taking $500 billion, not million. 500 billion with a "b. out every single year. >> so the president there saying that calling xi jinping an enemy on friday, calling him a great leader today, that's just the way he negotiates, you don't get the sense, brian, that this is a president who's going to change his personal style any time soon and sort of letting the audience now there and the world know this is who he is and this is how he's going to continue to operate and we're going to be all following the twists and turns as it goes through the next couple months >> it's been two and a half years, i'm not sure who's still waiting for the style to change. eamon javers, great coverage for the g7 we'll see you soon, thank you very much. if you don't think that words matter, you're not paying attention to the stock market. we want to take a look at the market action over the past two trading sessions, really the 48 hours the market was open. okay, look at this thinks friday, 11:00 a.m., stocks plunged

that is when trump blasted china in a series of tweets, sort of that nasty language that eamon was talking about. now, we sold off here into the close. then we went into the weekend, thankfully now we had more comments from the president that sent futures even lower now around 4:00 this morning, it looked like another big down day for stocks, we came in for worldwide exchange and guess what it didn't look too good. but then a whip saw turn around as the president said china was indeed ready to come back to the table. that's this here here's 600 points down, yeah, we saw a 200 or 300 point pop at the open and the market stayed flat the rest of the day the question is, how do you live through all of this? how are traders trading all the twists and turns from trump on trade? time now to go to trade school, class in session with mr. tim seymour. >> well, first of all, i want to point something out because this line right here is 2930 is really the line we've been bucking up to for two weeks on every tweet, good tweet, bad

tweet. we got into here and then the e-minis, if you're trading sunday afternoon, my family wonders why i left the beach and went to look at the screens. >> did you really? >> we were down another 35 handles in the afternoon and from the close we were down a total of 60 handles which was a total of 120 s&p points. we were down last night. now, ultimately, you say, what are you supposed to do during all this and i think the most important thing is to continue to watch. remember, you need to watch the dollar, watch the dollar yet the dollar index, the dxi is a two year chart that anyone should want to own and that doesn't bode well for the markets. the other thing that -- guess what else went downright here? u.s. treasuries. the ten year bond yield, a rally in bonds, a risk off moment, was a place where we got down to 143 overnight before sailing back up today. that's not great news. based on what i know, talking to a bunch of accounts on the street, this is pension funds that have to chase bonds lower relative value still favors those yields >> okay so your anecdote, about

sunday, leaving the family at the beach, that's the kind of market >> it was getting cloudy too just to be clear and i didn't have enough sunscreen. >> listen, that's the kind of market we're in. everybody i know, our team on worldwide exchange, they get in at 2:00 in the morning 9:00 p.m. at night the night before, everyone's emailing each other because that's where we see asia and futures start to trade. everyone is so now hinged on this moment to moment. we had futures move, i'll call it a 500 point move at 4:30 this morning. who's doing that who's doing that >> i tell you what i hate to chalk it up to the machines but high frequency -- >> 7:00 a.m. roughly when all the futures traders in new york got in now they're moving at 4:30 in the morning. >> this is probably one of the slowest trading weeks of the year so a lot of people stayed on the beach the bottom line is nothing is really changed in the last three weeks. we've been in a trading range on the s&p. the most important things, i think, are the fed, which is largely been marginalized but look, if you look at the market that is underperformed during these tweet storms, it's been

autos, it's been semis, it's been things that really haven't necessarily snapped back but there's parts of the market that every time you get one of these tweets, it's reinforced the investment case and overall that's where we are. >> can we -- guys, can we bring a two year of the s&p, a two year -- not the two year two year chart of the s&p 500 up because how do you trade this? carter worth, welcome. people look at this and say we haven't gone anywhere but how is our viewer, the "fast money," the cnbc audience supposed to deal with a market that moves 300, 500, 800 points on a tweet. >> that's right. and that is a dysfunctionalty that is treacherous, role, in many ways, whether you're long or short but tim really captured it when he said nothing has happened we are unchanged but when you have extreme volatility like this, it represents indecision there are a lot of people who believe that the selloff of august is a great opportunity, buy the dip, and there are a lot of people who think this is the beginning of a more serious

unwind so after the initial selloff, the real plunge of august 1st through 5th, we've had six three-session moves of 4% or more basically we've been gyrating around and more often than not, you get resolved in the direction of the primary move. so, the primary move is down we've been backing and filling and then you get a second down this is exactly what happened, actually, in october, just before we got into real trouble last autumn. >> in fact, carter, probably, you should be at the telestrator. this is a two year chart >> what are you talking about? >> i highlight -- him instead of me not him instead of you take it easy, son. all right. here we go january of 2018, and you can see tim made the circles, very nice job, you colored inside the lines. so here we have a market what are the key numbers, carter is there a specific number on the s&p? that we need to really closely watch right now. >> ultimately, the minor lows of the past four, five weeks -- i mean, four, five, let's say, well, weeks, really, that we

keep on -- i think we're going to break that sort of 2,820 and ultimately we test the june lows and i don't see a lot of upside and it's not so much about the market it's about the constituents. we have an increasingly narrow market and that is a problem >> all right, carter, thank you very much. good stuff >> great stuff >> good stuff. >> lovely telestrator. good stuff >> if you're trying to time when we're going to get a trade deal, one top strategist says it may be coming sooner than you think. we're going to hear from oppenheimer's chiefstrategist onset next and later, insuring your portfolio. carlotaer worth, he's got one stock that he says could be the perfect protection play and the company is actually already in the business of protecting your assets he's going to break down that name for you we are live as always for the nasdaq in times square much more "fast money" right after this

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welcome back to "fast money. if you are trying to time the trade talks, your next guest says that a deal might be coming sooner than later. let's now bring in john stoltzfus, chief investment strategist at oppenheimer. happy to have him onset. you remain optimistic about the

markets, you remain optimistic about trade. how? >> still bullish after all these years. it just looks to us that what we've got here is we're building towards a crescendo, all the mayhem and the tweets and everything else, the retaliatory remarks from china, yet the underlying case is both leaderships are getting a lot of heat back home to get this done so that they can get on to other things whether they ultimately recognize it or not, or how soon, it's hard to tell. >> i don't know if this is the controversial question or not. but if we are headed into a recession, and we don't know, listen, everyone's talking about it, we don't want to talk ourselves into it but if we are heading into a recession, would a trade deal, john, even matter to the equity market >> oh, i think that a trade deal will see an about face of all the predictions of recession you'll see a ramp-up of global growth expectations in terms of

gdp, global growth in terms of earnings and revenues for corporations we could have quite a rally from that and then we'll likely have, after a quick rally, you'll have one of those -- i'm from missouri, show me moments where let's see how it works out it's not like heaven on earth or anything but the markets would likely be very positive on a deal >> so let's take it the other way. clearly, trump's achilles heel is the election coming up, right? and so the chinese know that what are the odds that they just drag it out until -- even all these talks go on and they say, we're going to get a better deal if there's a recession in the u.s. and trump is not re-elected >> i think the likelihood, then, is whoever they meet on the other side of the election will have to carry forth on this because the irony of it is, as much as trump's presidency is contested, it's unconventional, you know, it has a lot of detractors as well as supporters, but the big story is, here, this is one thing both sides of the aisle can agree on

and trump was the only worldwide leader who was willing to take on the chinese it's an extraordinary thing. now, whether he did it for altruistic purposes because it looked like a good pitch, that's up to him. >> mark. >> hey, john, so assuming we get a trade deal done, how long do you think it takes for the economy to snap back, given that i think a lot of damage has already been done? >> well, the damage, ironically, has not been significant if we really look at the first year of the trade war, it was 2018, the u.s. economy produced gdp growth of 2.9%. that was the best since 2016 and before that was the best since 2006 so that's extraordinary. not bad considering. now, the damage is beginning to happen as the trade deal has expanded, more goods are implicated by this thing or impacted, but at a lot of it's in planning but today with technology, in terms of all kinds of methodologies for planning and execution,

logistics, probably fairly quickly but the markets, as a discount mechanism, would pick up on the idea of a healing to the global economy and move ahead of that. >> i don't think it's just china, john. i mean, i think you've got, you know, these worries about europe, germany slowing down, all the manufacturing, industrial production numbers have been pretty lousy we've got this brexit threat coming at the end of october as well argentina, which doesn't necessarily matter from a macro perspective but it's another negative -- another poke in the eye for the market, if you will make the case for u.s. equity or maybe i just did, that everything else looks so bad that we just look good >> is it an earnings growth story? because basically if you're going to get a rally, you know it comes from cyclicals, that's in nature of oversold balances so your argument for low quality, low margin earnings uncertainty, the things that are in many ways desperate, not to say that you're making a desperate call but that's what bounces most off of a low every time >> right so, do you see that really

happening? i mean, glen corps and u.s. steel and big heavy manufacturers and banks that are, you know, struggling? that's the only way it happens >> well, materials -- when you get to materials, they tend to be one of the areas that really picks up on some kind of a turn. i'll never forget the first quarter of 2003, everybody was still looking at their screens, looking at all the red and technology from the tech bubble and all of a sudden in the first quarter, i think it was march 31, word came out china's oldering a lot of materials, they're buying stuff, they're building stuff, wow, the market took off >> but john, i will make the sk case, though, and i don't know the exact number, it's 2003, but i would imagine the s&p 500 forward priced earnings ratio was probably pretty low. it got down into the single digits at the peak of the nasdaq sort of decimation we're at 21 times trailing earnings right now >> well, is it -- >> is the valuation different?

>> my read on my term middle showed me that s&p 500 trailing earnings are 18 -- little bit lower. they've come down. they were pushing 20%. so, valuations are better than -- from what i can tell, and then the other thing is there's a shortage of good equities there's a huge need, demographically, for people to move out of the overbid that they've made on bonds and move into stocks. there are people have objectives that are three, four, five, seven, ten years out that can afford to take a little bit of risk here with a portion of their money so that they can -- they won't have to worry about outliving their funds. >> so, the recovery were out but it's got to be for multiple expansion or earnings growth >> it's an and/or. >> that's what i said. >> so far, you know, when i look at it, carter, we've got earnings growth of about 1.5% in the second quarter earnings,

revenue growth about 3.4%. bears would say that, well, the earnings growth isterrible but the reality is revenue growth gives you a better idea of forward looking, generally speaking the other side of it is, when you look at the whole world, when you think of germany and the other countries that are suffering, a lot of it is because they depend on trade with china and china's not buying a lot of stuff because they've got domestic problems at home in terms of their economy slowing that they're dealing with and they've got the trade war. so -- >> oh, by the way, hong kong protests >> yep and both of us were in hong kong around the -- recently >> yeah john stoltzfus of oppenheimer, target there, 2,960. optimistic on trade, we appreciate you having us on. >> thank you >> thank you very much >> the one thing, mark, we talk about with bonds, and i understand his point, but bonds have been, as an asset class, we always look at the interest rate bonds have done what, they're up 20% this year, the tlt has rocketed it's been a great capital appreciation story

>> it has, which is interesting but it can't continue. maybe it can who knows. there's all this negative yielding debt out there, where else -- >> ten year yield will go to zero >> it could go much lower because there's all this negative yielding sovereign debt out there so where else does the money go it's flowing into u.s. treasuries right now and that could continue to happen and you could continue to see more appreciation there i got to tell you i'm not overly excited about jumping into bonds that are paying 1.6% but if the appreciation's there, it coulding be attractive >> your going to see rebalancing, people now way overweight bonds doesn't mean it's a quick gift for equities but there's no question that people are over their skis and i think back to the market multiple, we should be trading higher because that's what goes on in this environment. >> we are just getting started here on a very wide ranging f t "fast money. >> betting on a breakout, the options market says this chip stock is ready to rip higher we'll bring you that name. but first, riding high, lyft

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all right, and welcome back to "fast money," we've got some more breaking news on that johnson & johnson opioid verdict. we have an attorney for j&j outside of the courthouse in oklahoma. >> reporter: hi, brian, i'm here with sabrina strong. we're talking just after this wrapped up, the court here found for the state of oklahoma, staying that johnson & johnson caused the opioid crisis here in state and ordered the company to pay $572 million now, j&j says it plans to appeal what does that process look

like >> yes, well, we believe that the decision is flawed and we fundamentally disagree with it and so, what that process looks like is we plan to put together appellate papers that appointment out tpoint out the problems with that decision. the facts of this case demonstrate that johnson & johnson did not cause the opioid abuse crisis here in oklahoma or anywhere else in the country the facts at trial showed that johnson & johnson's products were rarely diverted, rarely abused, and amounted to less than 1% of all prescription opioids that were prescribed to patients here in oklahoma. and that's true throughout the country as well. >> reporter: so you're disputing the judge's decision, which did find for the state if you look at johnson & johnson's stock right now, it's up wall street sees this as a victory for j&j. how do you kind of look at that reaction >> again, our position on this is that the decision is flawed

there's no basis for liability against the company, whether you're looking at the law or looking at the facts this is a radical departure from the law in oklahoma. for over a hundred years, public nuisance law in oklahoma has been limited to property disputes that's not what this case is about. >> reporter: of course this is not the only case going on for johnson & johnson and for many other companies. about 2,000 cases have been consolidated in federal court and ohio and those should go to trial potentially in october you said in a statement or johnson & johnson did that those cases are different but j&j isn't opposed to a settlement there. how are you looking at those cases? >> those cases are different in that right now we are here in oklahoma under oklahoma law. the cases that are consolidated in the mdl proceeding in cleveland, ohio, are under different law. they have different parties, different theories, and so we do believe that those are very different. in terms of settlement discussions, the company is always open to engaging in

settlement discussions as appropriate. >> we heard from attorney general mike hunter who spoke directly to johnson & johnson's ceo alex gorsky, saying he's got to open his wallet and help pay for the crisis in the state. i understand the company's going to seek to stay the payment through this process do fopharmaceutical companies hv any duty to abate this crisis? >> the opioid abuse crisis is a massive public health crisis that needs to be addressed but you can't sue your way out of the opioid abuse crisis litigation is not the answer, and at this point, what's important here or the question in this case is did j&j cause the opioid abuse crisis and the answer to that is plainly no. >> reporter: sabrina strong, we appreciate you joining us. >> thank you very much. >> reporter: back to you >> meg, thank you very much. >> we talked about johnson & johnson. i think the most important thing is to talk about the opioid

crisis and say this is something that's not going away, it's a big political issue on both sides of the aisle this is where you want to see a few heads on stakes and i think there are going to be plenty of settlements that gone on here. this was a settlement that was significantly less than expected for johnson & johnson it begins a path for them to get past all this >> we have ohio and the talc that you mentioned so the headline risk not over yet for j&j. all right, up next, let's switch gears. it is your call of the day shares of lyft taking off but can you really trust your money to a money losing ride sharing company? and later how a colonel helped beyond meat investors feel a little more full today 'lexaiwi "ston" returns. in the human brain, billions of neurons play in harmony.

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all right, welcome back to "fast money," your call of the day, a much needed upgrade in lyft guggenheim upping it to buy from neutral, got a $60 price target. guggenheim says we now expect lyft to be ebitda positive in 2021 lyft shares still down roughly 30% since the march ipo. does anybody around the table own lyft will anybody around the table

buy lyft on this upgrade >> crickets. sorry. >> well, don't own it but actually -- >> don't all jump in at once >> risk reward wise this isn't a bad call because you know that $47 is the low since the ipo so you can shoot against that and so if you're talking about a $60 upside i'm looking at $10 on the upside and maybe $3 or $4 on the downside that's not a bad risk reward. >> the optically bizarre thing is this is a call for $60. now, that's a -- >> i yield $72 >> $72 is the target >> that's the ipo. >> but the call is for the stack to go to $60 a 17% gain a 12 month price target. it was $60 eight sessions ago so it's just a speculative -- maybe it bounces but so what >> well, there's -- by the way, there's some optically bizarre stuff on this desk but i won't point it out if you look at the company, the main thing that you hear them saying is the rationalization and the competitive landscape

that these guys won't be beating each other up. that's what i heard out of the sector for the last six months i don't know why that is the case right now, frankly, for companies that are struggling for free cash flow i think they're going to be looking for how to take market share lyft has been doing that, by the way. i mean, if there is a company that seems to have been pressing their put -- their foot to the pedal, maybe it was guy who was a lyft driver. >> it was. >> he was in lyft. >> i'd rather be in uber here. they're growing a top line faster here. >> is that if you had to pick or do you like uber by itself versus everything else >> uber's on our watch list right now. we're looking at growth at a reasonable price so it is on our watch list night, growing a top line, 30% to 35% the enterprise value to revenue valuations, a 25% discount to lyft so i like it. >> mark, uber lost $5 billion in 90 days. >> yeah. >> it's not good >> no, that's not -- in fact, it's -- >> we don't own it i don't own it

>> it's possibly the worst quarter. i don't think it's solvent hyperblooe to say it's the worst quarter in 20 years i've ever seen for a company that is viable >> correct >> i mean, i've seen worse quarters for companies that are no longer companies. >> right sometimes it takes -- >> what about that quarter made you think uber is anything more than just a subsidized by private equity money losing taxi organization >> the valuation so with it dropping the price, the stock price, obviously, the valuation becomes more compelling at a 25% discount to lyft with a more diversified revenue base, growing the top line faster, i think they eventually fix their problems. i'm not jumping in today but it is on the watch list. >> i mean, the bottom line is both of them need to raise prices >> right >> i'd much rather be the user of the product, get the subsidy from venture capital, from private equity, than buy the stock. i use my savings to buy some other stocks >> very simply, transportation as a service is still early stages i don't think you have to jump

in and get one of these guys uber's taking the more expanded approach to their business model, you want the core play, you buy lyft and pray. >> you get to keep and pray. >> did i say that? >> that's your investment strategy >> cannabis delivery service, an hour later, the kfc delivery service. >> we could do a whole other show on that >> if there is a recession coming, still an if, don't tell restaurants. those stocks have been even fuego this year and made investors a lot of money but there's a threat on the horizon that could take a big bite out of the rally, what it is and how to play it speaking of food, another big fast food joint teaming up with beyond meat but is the deal as finger licking good as it seems on the surface >> that looks good >> we are live at the nasdaq in times square much more "fast money" still ahead. - at southern new hampshire university,

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i was in beijing to celebrate the 20th anniversary since starbucks entered china. we now have 50,000 starbucks partners in china who proudly wear the green apron and it was a real privilege for me to be with them and share that experience, so we have built starbucks in china, for china,

and they execute on what we call china speed. and they're doing a great job. >> that was starbucks ceo kevin johnson talking about, of course, china with jim cramer. there's a lot more to the interview. catch the full one on "mad money," coming up in about 15 minutes. that's one you cannot miss, especially with everything going on around china. starbucks is just one of several restaurants with big exposure to china. so how are chinese trade tensions impacting the food space? kate rodgers thankfully is here with more on the story >> that's right. well, there are three restaurant names that are really on the minds of analysts as trade tensions ramp up with china. starbucks, as you mentioned, mcdonald's and yum china now, analysts point out that starbucks actually owns its stores in china whereas mcdonald's and yum china franchise and license in the country, so if consumer sentiment shifts there, starbucks would likely feel it most but there aren't any signs that's happening just yet as this trade war continues on. starbucks just put up a 6% comp number the company's also aggressively

expanding there which it's called its second home market. there are currently about 3,900 stores in china including new smaller format stores meant to cater to customers who are on the go and take on luck in its new competitor there mcdonald's had a 7.9% comp number in its developmental license market which does include china where it should have some 4,500 locations by the end of 2022. ceo steve easter brooke noted that the chinese population is gravitating two western qsr. yum china led was led by 5% groh at kfc starbucks is up nearly 50%, mcdonald's up 20% and yum china up nearly 26% and i have one more name for you guys to kick around restaurant brands international. they are slowly moving into china with tim horton's the canadian coffee chain, popeye's, 1,500 locations. >> little coffee fight coming in china. >> they're moving in a smaller

way. luck in is expanding aggressively starbucks calls china its second home market, it's u.s. and china, those are the two places they're really focusing on tim is dipping its toes in but popeye's, 1,500 locations in the next decade f you're not bullish on china, you don't do that. >> shake shack more than doubled this year, chipotle, starbucks, denny's, wendy's, red robin. >> we talk about the demographic that's shopping in these places and we have a case where if you look at starbucks, what's extraordinary about their comps is that their comp sales were up 7% in the u.s. the u.s. is still a place where they're getting the lion's share of their growth and they're adding innovation and digital and loyalty so a valuation that makes no sense relative to where you price this thing five years ago as is with mcdonald's, as is with yum, i stay in this stock >> i mean, these stocks have been just absolutely monsters. >> restaurants or starbucks.

>> i'm talking about mcdonald's, yum, and starbucks all of them, it's hard to say anything negative about the way they've traded the problem you have, and this is a trading show, so they're looking at ten years out, what's that growth going to be look like, as a trader, you look and say, what are the next 90 days going to look like and to me, that's where the risk is so, i wouldn't get too far over my skis in these names i wouldn't be short them but i wouldn't be adding on to them at this level >> with a starbucks and a dunkin perspective, a lot of people don't watch coffee i like looking at coffee prices are at or near 30 year lows. have they cut the price of your triple americano with a double spritz or whatever it is >> that's not how the world works but they're also taking on -- there's sort of a belief that these are becoming defensive almost that mcdonald's, starbucks, but keep in mind, starbucks in the '07 peak to the '09 low lost 82% of its value and it was growing much faster than it's growing now. as a garp manager, would you buy

this stock >> starbucks, way too expensive. >> what price do you pay for the growth and by all accounts whether it's the 90 day trade or longer term it's rich. >> they're almost getting a growth technology multiple when you think about what they're doing with deliveries, so it's getting them higher ticket price charges, they're basically getting a better top line, getting loyalty, they're getting a place where you have, i think, an enormous change or a rerating this isn't the same company or the same dialogue you were having five years ago. >> i would add to the technology point they have this deal with bright loom technology they're going to start licensing that tact to the licensed stores so mobile order and pay is not available at a lot of the locations particularly outside of the u.s. so that's a big growth area. >> can i ask, is there a negative to the mobile i understand everyone loves the mobile i'm going to just say this sometimes you go into a starbucks, and you're third person in line but 62 people jump in front of you because they had mobile orders and you just walk out. is there a -- i wonder if there's a downside to the mobile

order. >> i don't think a lot of people walk out is the point. i think they're willing to wait for it you walk out, maybe. >> all of a sudden people just kept going to the point i guess i either have to order mobilely or don't do anything >> it's been a huge growth area for them so that shows that even though you sometimes have to be patient, particularly the times square store can be very crowded, i did mobile order today there and i waited for it so i think the consumer may be little to wait >> patience, brian, be patient >> i'm getting coffee. there's no room for patience thanks, kate let's stay on food because food. shares of beyond meat got a big boost today. this after kfc, kentucky fried chicken, guys, listen to this. announced it is going to begin testing beyond meat's plant-based fried chicken in an atlanta restaurant tomorrow. beyond meat, now more than 500% since its may ipo, still 30% below the july highs does this get the nugget pop >> i think it does i mean, that's the story with this now, you're going to say, oh,

the valuation's crazy, never going to be able to li up to all this but the story and what drives the stock today is wins so are they winning new customers and this proves that they are and again, risk reward, which is something i always look at, is not that bad here you're close to the recent lows, you have a lot of people that are negative on it, so i don't think it's that bad. i think you're going to get a bunch of these wins coming out >> growth at a reasonable price, no way you own this stock. >> no, i'd rather be in a company like tyson foods who's going to have their own plant based alternative at a much more reasonable valuation >> beyond meat >> look, i'm not rushing into kfc or anywhere for a beyond meat burger and i think you're getting to a place where if there's disruption in the meat space, this is something that i think other people will be doing generically, white label wise and if i'm a company with massive distribution, why am i buying it from someone else when in fact i don't think they're going out of their way for that burger into my store >> it's all very peculiar. at the end of the day, i mean,

we know it's being embraced, it's yet to be determined whether this will really become long-term, the thing that people believe it will. >> you're like an owl with a graduation cap on. i mean, that was just so -- it's very peculiar. >> got a nice visual >> shares of amb not kfc on a tear this year and the options market is betting that the red hot chip stock is heading for an even bigger breakout we're going to lay out the action we are live at the nasdaq market site much more "fast money" right after this you should be mad at airports. excuse me, where is gate 87? you should be mad at non-seasoned travelers. and they took my toothpaste away. and you should be mad at people who take unnecessary risks. how dare you, he's my emotional support snake. but you're not mad, because you have e*trade, whose tech helps you understand the risk and reward potential on an options trade it's a paste. it's not liquid or a gel. and even explore what-if scenarios. where's gate 87? don't get mad. get e*trade and start trading today.

the semiconductor etf making some wild moves this week as trade tension with china intensifies. the chart could make you seasick but the options market says the volatility could be a set-up for the chips to rip higher. mike is in san francisco with the "options action" on chips and amd. mike, what are you seeing? >> yeah, so, today in amd we saw call volumes outpace put volumes by more than 4 to 1, very heavy volumes, more than 220,000 call contracts trading overall and the most active amongst those were the weekly 32 strike calls early in the day about 75,000 of those had traded hands already

at just under 30 cents and over 94,000 contract have traded and buyers are bitting it's going to be above the strike price by at least 30 cents i would appointmepoint out that 13th the stock was above $33 some of these stocks that have been whip sawed quite a lot, some of the activity we're seeing a little bit of a relief rally or just looking to play that volatility hoping they might bounce back even to levels that we've seen just within the last couple of weeks >> all right, mike, thank you very much. let's trade this, guys amd, the options market saying one thing. anybody around the desk agree or disagree >> remember, september 1st, we've got the potential for tariffs. i think these names clearly are going to be the ones that would pop if for some reason they delay tariffs or there's some sort of resolution or at least maybe they had a third phone call or something like that so this is not a bad trade. you don't think they had the first two? >> for all those folks looking

for cyclicality in the market they're looking at semis, carter will tell you it's done nothing for the last two years except slowly make a couple new highs i would say slowly here we're getting nowhere higher without some type of resolution on the trade deal otherwise it becomes a very, very volatile trade in the short run. >> all right guys, thank you very much. good stuff on amd. for more "options action," be sure to catch the full show fridays, 5:30 p.m. eastern time. up next, your final trades (indistinguishable muttering) that was awful. why are you so good at this? had a coach in high school. really helped me up my game. i had a coach. math. ooh. so, why don't traders have coaches? who says they don't? coach mcadoo! you know, at td ameritrade, we offer free access to coaches and a full education curriculum- just to help you improve your skills. boom! mad skills. education to take your trading to the next level. only with td ameritrade.

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it is time now for your final trade. let's go "around the horn. first up, tim seymour. >> reaffirming the j&j tried earlier, you have a very good stop but there's a lot of bad news in this stock already >> buy j&j >> bk is highly skeptical that lucy doesn't pull the football away, sell the spy >> selling the whole market. bk is negative >> sales force, so another beaten race quarter, it's cheap versus its peers and investor sentiment is changing so that's going to lead to a rerating. >> bullish on sales force. carter worth >> so, going to go with chubb, an offensive defensive play, insurance stocks in general have been good of late, they falter

and yet chubb has held up very well, very low beta, it's a class all by itself. i think it will get you done either way >> buy chubb, buy j&j and bk says, sell everything, sell the kids, sell my mission is simple, to make you money i'm here to level the playing field for all investors. there is always a bull market somewhere and i promise to help you find it. "mad money" starts now hey, i'm cramer. welcome to "mad money. welcome to cramerica other people want to make friends, i'm trying to make you money. my job is not just to entertai but educate and teach you. call me or tweet me. every time president trump says something inflammatory that panics wall street and sends the stock market plummeting, like we saw on friday, you got