and yield curve. >> a 1% of a record high we get macrotomorrow to mix with earnings a check on the consumer is probably something we start off about o with. >> dow up 1% that does it for "closing bell." >> "fast money" begins right now. live from the nasdaq market site overlook new york city's times square this is "fast money" process i'm melissa lee. trade remembers tim seert seymour. kaern finerman, dan niegt nathan and guy adam in and tonight steve iceman where he spots the next opportunity a earnings alert on united airlines, a lift after results we break down the headlines and speaking of earnings the options market is betting big on the big move from fet netflix reporting tomorrow we will break down the action. we the race to new records stocks breaking out as banks earnings get under way jp morgan gaining 3% on strong results. the company says the consumer is

holding stronach bank of america reports tomorrow one of the biggest shareholders is getting more bullish. ber shire seeking permission from the fed to boost stake in the bank beyond the 10% threshold. did jamie and warren give the okay to ride the rally to new record highs >> why not those are the two. -- if knows two say it's okay, who am i to argue with those two. >> back to you. >> back to you, mel. the jp morgan was quarter was fine and we'll talk about banks but put going in perspective and tangible book in jp morgan stock 120. even i in my lame man can do the math and tell you tangible book it's two times tangible book right now. that is a pretty big premium in this environment, i think. in erms it of mr. buffett, he is actually sitting on a record amount of cash as well maybe that's why he wants to deploy to more banks but the indicator he mass looked at his entire career, the wilshire 5,000 over gdp in the

united states. i mean that is flashing as red as maybe it has ever flashed i've been skeptical. i've been wrong. and the vix below 14 to me is madness. with that said that, the market seems to be full speed ahead. >> that's a vix down 40 peppers in eight sessions. telling what you investors -- it's been a roller coast are i think the sentiment is this tug of war back to what jp morgan, jamie dimon what banks could be telling us the biggest money center at a bank tells you the consumer is health and shending the balance sheet never better the bore oh or oing so high into the number and beat it that's impress guy talks about where the valuation is i don't think it's expensive at all especially best in class but it'sen easy to push back on banks and say they're not all trading luke this. but looking at jp morgan on one year or two-year basis has outperformed the s&p, that tells you that banks nar run bell,

efficient in capital and even when fees are in their face and there is compression in a lot of banking areas, efficiencies and cost savings and giving capital back to investors is something that works. >> that's a narrow argument because you are talk about jp morgan the the investment banks morgan and foamed are down. >> they're not money center banks. >> they're trying to be like them the regional banks they're down 13, 14% from the 2018 highs. stuck in a range in thedown trend. i'm saying i don't disagree with about jp morgan. you guys have heard me say frequently and you know like why jp morgan have a ball. made the new all-time high. >> it's a good time i'm feeling good about it. >> but most of the other banks in the u.s. don't act irk particularly well and don't shapiro the characteristics you just said that jp does relative to s&p fiechd. >> it's a bad sign. >> i'm saying it's not a -- >> okay let me counter to that because i don't think goemd or morgan stanley are playing

better or worships it's different. but bank ever america and citi bank we can have a similar conversation i don't think those banks kept pace with jp but those, the diversified both exposure to the u.s. and global economy. banking consumeren leans mortgages i like them both as well. >> i mean, i agree jp morgan there is a lot to like the netted interest marlanaen did come in a little bit as you would expect during pressure on rates that we saw. loans better spread. the thing that really stood out here and in citi bank was how strong credit cards were the business was up huge for both of them appear is a tells you the consumer is really spending. whether or not, you know -- you always talk about the balance sheet not being in as good shape. the worst in decade. still out there spending and feeling comfortable. that's interesting to me that hopefully reads well for retail we won't see that for a while. jp morgan even jamie dimon as you know i love. >> iris you first named him. >> i can do de la.

>> he doesn't need to answer he talked about return on tangible common equity 18%. a really really excellent number but he also said look this is peak these are peak numbers yeah we're not seeing forever something like the environment that's perfect par phrasing but there is a lot to like but i think there is a little bit of caution in there as well. and on the flipside, i actually goldman sachs wasn't that bad -- went that bad it opened down a few dollars. there was a lot ump lumpy in there marking do you know uber and private equity that's lumpy, doesn't -- it should be sort of ignored. i would ignore on the upside with a big gain. but that's getting interesting but -- so jp morgan, bank of america and citi i'm with tim i like bank of america and citi as well would i own them all. >> i don't know if warren buffett will buy more stock in this has been a longstanding 10% has been the threshold a rung time doo but in terms of the particular banks the arbor

broadest businesses touching the consumer and the globe, these businesses doing well. in terms of warren buffett wanting to buy more of bank of america regardless whether or not he is allowed to. >> right. >> can we extrapolate this is good news for the markets sitting at 1% from record highs? >> i endo he no know in him wanting to buy more baepg of america is more value. i don't know i'm happy as a bank of america shareholder. >> i want to drop today's earnings we've been waiting for earning season i want not talking about woman up stories even if we're talking about the top down, about bottom up but the trade deal on trds friday is not something i'm doing cart wheels about tp i don't understand phase one and don't nifrpg we want it but it's not about us and them. it's about where is the mcgee? and is it all in right now no it's not all in and in fact you could say that jamie dimon's assessment of the u.s. consumer is at peak labor i want not that cfs appear krechlt ceos are terribly kwft

the economy right now. we know they are not for the stock market i want to be clear being cautious on the economy being cautious on the trade deal, does not mean that certain stocks can't continue to go higher that's what we see. >> i got to make the point, we were in mid-july, q 2 earnings, q 2 earnings period then back to you know late april, early may, that was q 1 earnings period, the same sort of vibe, the markets were at highs. kind of -- what are we going to discount, break out to new high sns that's how i started the conversation, mel. it sets up almost identical to the prior two periods. now back for all intents and purposes at a new all-time high we will be there in a couple of days the question you have to ask is what are we discounting, right expect aches were low into earnings we no that we've been talk bag that a couple weeks. let's say you come in above that the early beats. stocks manufacture move. as we make the new high, then what in? to your point i don't think ever at weekend we had time to think

about the trade pl it's a lot of nothing. native an 29.07 it's a muj promise. >> built up over brexit is something that's a little weird. i agree with you about can i. >> the only point is the last two times when we had the new high at the back end of earnings season what did we got? 7% drawdowns right afterwards usually corresponding with disappointment about trade what's different is this time we have a fed that's been easing over the tame same time. >> semi conductors making all-time highs 10%. >> total outliar. >> isn't the automatic sign of the cyclicality and global economy? we've been hearing you can't get higher but that's a great looking chart right now. i'm not telling you i feel greet o great about the wrmd i'm telling you some of the things in the face of not good news go higher >> on the banks. jp morgan two times normal volume traded closing where the previous all-time high was which i think was march much 2018 or so so much like apple who by the

way apple blue right through you have a potential for a bit of a double top here it would make sense if you trade this on a day like today to take profits. but i would understand if you want to continue to ride the jpm train. but o would boy i think the restraining order is over you're good torg with jd. >> our next guest has three names he says are driving to new highs. chris vern eu a at stra teg as. >> i want to put in this in conteng. back to the 2016 lows jpm was $50 it goes 50 to 120 then hits a wall in january of 2018 at about 120. and we get just two yeerps of dead money now, where was the s&p two years ago? roughry the same level 2,900. 2950 let's zoom in here to the two years of inderns let's see if we can learn where it goes next january of 18, 120

another failure at 120 another failure at 120 four or five times okanu along the way we've been unable to overcome the pry hires why do i think this different in for one the moving averages are upward sloping again, 50 back above the 200. i think importantly the yield curving is steepening. it was flattening this move and now steepening this is a change in character in this chart when we look at this range, 120, to about 90. 30 and point remaining you get a break out above 120 you're talking about a $150 stock. ultimately that's where we think it's going one of our favorite big cap bank plays second nim in terms of bellwether, deere, industrial, been at the krerpt of the storm the entire china strayed stuck here ner 170 been here before, failed in the past what's different this time the bears had every opportunity to finish this thing off four or

five six weeks ago and couldn't. it on the ropes but couldn't deliver the fatal punch. book back at the highs 170. about a 30-point range you look at 202, $205 stock with a break out. 50 back above the 200. held support 250 li 200 day upward sleeping the technical improves even though not much priegt price progress made here bank, industrials and tech this is alphabet i think this is another skpafrm process. this is a sl $800 billion company another megacap bellwether acting better than the sken us gives credit for 0% drawdown in spring of '18 another 20% drawndown last year opinion and another drawdown earliery this year tree bear markets in this chart over the last two years. i don't think we get a fourth. the technical improve. 50 back above the 200 held

support the other day. 1240, 1250 where we trade today. talk bag three to point range. you are looking at $1500 stock alphabet, between jp morgan, between deere these are bellwethers sending a powerful message about the market that we think it's going up. >> come on over, chris. >> bring him over. >> we'll bring the chair in. come on, will. >> will does an amazing job. he is a harvard grad like yourself. >> i know that. >> he went to the actual university not the online academy. >> i'll leave that where it is sfl into >> terms of three stocks are the three stocks outliars compared to peers or representative of sectors. >> i think what's remarkable here is the market knows a lot more than i know or you know or you know when you look at some of the bellwethers over the last couple of weeks, across all different sectors, right, industrial, deere, jp morgan waengs. evencity taiwan semis process the semis be samsung, big glebl

belt werth breaking out of two-year ranges now how many more of these do we need to before directionally up become the kbas case i love that the imf downgraded growing. just as things look better, the impf wants to take the o'er. >> >> for every deere there is cat. google azmodan jp morgan there is the regional. they balance each other. i don't see -- these are good looking charts. >> yeah. >> they are. and the companies probably have decent fundamentals, good valuation. but i can find another one -- i'd -- i'd argue that amaze isn't almost important than goog i don't know. >> you know, that's a god point. but let's rewind the clock back 12 months. sitting here october of 2018, there was only one place in the world to make any money. fast f.a.a.n.g., the only game that worked. today you have other parts of the world. europe trading great

even parts of em where the industrials for the first time in two years show signs of life. what's notable about the sector if you look at equally rated it's broken out. the average industrial is trading better than cat or bogey. there are signs under the surface that hey maybe directionally up which is the least populated call is the right one. >> implicit to all of these charts, though, chris is your brought broader call that the markets will hit new record highs and well beyond a% higher or. >> i think that is a directional move we have combination of bear sentiment and kwood seasonal that's a powerful or potent contextle for the market to valuey in the back half of the year. >> chris veren of stra teg as. >> looks like a.m. a couple weeks a, the deere 170 is the same level trading i think in january of 2018. valuation, yoeptd, 16 times in this environment i think it's a little rich they report on november 17th we'll see. again if if you trade and you enjoy the run up and it has been

deeson you take profits here in d.e. >> coming up, the united taking flight after reporting results break count what is fueling the gains. plus, you know from the big short, steve iceman back ready to give the next best idea live from new york city in sometimes square much more "fast money" right after this (crowd cheering) stand up if you're a mother. if you are actively deployed, a veteran, or you're in a military family, please stand. the world in which we live equally distributes talent, but it doesn't equally distribute opportunity, and paths are not always the same. - i'm so proud of you dad. - [man] i will tell you this, southern new hampshire university can change the whole trajectory of your life. (uplifting music)

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welcome back to whipping time for earnings whiff. united and interactive brokers reported we begin with phil lebeau on united >> one reason the stock moves higher is because this is a company that beat the street by 10 cents earning $4.07 a share the consensus for $3.97. revenue come in at $11.38 billion, just shy the expectations but when you go with the numbers within the numbers, generally speaking this was an encouraging third quarter. a first off with passenger per available seat mile. passenger revenue per available seat mile. up 1.7% in the mid-range of gadeens. pretax marj j better nan expected at 12.1% and you know it cost slightly higher than the guidance of 2% but keep in mind, they had issues in terms of pulling back flights to china and hong kong

which meant fewer seats to that part of the world. they have raised their full-year dividedens it's now in the range of 11.25 to 12.25 a share it was in the range of 10.50 to $$12 shares not only that they are saying they are ahead of pace- to meet or exceed expectations for next year's full year earnings of between 11 and $13 a share. remember tomorrow morning life and squawk box, exclusive verify were oscar munoz ceo of untsd. we will talk about the third quarter and more importantly about the outlook in terms of demands on the leisure and corporate said and what they expect with the 737 max. remember it's been pulled off the schedule until early next year but already we hear rumbling with the from the aerial industry saying do we really think the plane will be back at the beginning of next year is it more likely it's pushed further into the first quarter we'll talk about that with obvious or munoz. >> phil, is it safe to say that

united guidance is usually conservative. >> yeah, not wildly conservative but relative to other airlines they are considered more conservative companies when it comes to guide zbloons phil, thaengs. phil low bow in chicago which makes the raise guidance even better look sfloog i think that's deeson. they raised the bottom of the end of the range they kbif and you a sense where the business is and visibility into 2020 which is excellent showing that they can be more efficient with their core business, which is what people are always worried about with airlines it's how costs and capacity tend to spiral out of control it's why they trade at multiples that bee lie the profitability of the companies over the last four or five years i like airlines ner cyclical as well near the middle to the bottom part of the range. own them here. >> i agree i like airlines. delta reporting the o'er da i, not great. sort of overdone, wasn't terrible but interesting about the 737

max that's a mixed bag when it comes back for some who don't have big exposure they've been able to pick up extra revenue but it's been expensive for delta >> all the time. >> right it's a double edged sword. i don't know how that shakes out ultimately if you are in the multiples are cheap as a airline multiples should be given how cyclical the business is. i like them here still long. >> united has been okay with the 737. >> dan as a great chart up i'm cheating. >> >> ha it has been in the uptrend for some time and that guidance makes united cheaper than delta against a well defined stop at this point i think ual is interesting. >> let's move to interactive brokers that stock in the he had

red in the off the lows eric chemy at the headquarters. >> that's right, melissa the stock down 3% right away and now come back to flat. the real story is that interactive brokers down 10% since announcing eliminating fees on september 26th the company on the conference call a few minutes ago saying we are trieding to create the best platform for customers meaning zero commissions but they're making money off this because with a zero commission account you're going to get your order routed to a liquidity provider the liquidity providers will may interactive brokers that's how the company makes up that money. the quarter that we just got, that ended september 30th. announced september 26th it's almost like it doesn't matter because the stock was year to date flat, basically flat now. what's happening now starting this quarter when these changes take effect? you can compare to their competitors, schwab is up 12% since its announced fee cuts

td up 7% interactive traders down they're down it's not so much what they said in the third quarter but what they're doing here in the fourth quarter. back to you. >> eric, thank you eric chemy it can be argued that some of thes other businesses that have gone up after announcing cut or zero fees is because they have other businesses they're not as dependent on trading revenues. >> schwab is one of those. it's interesting schwab wins with this because they can cut it to zero let the compel competitors fall by the wayside and do what they want. i understand what eric is saying in terms of liquidity providers, all that stuff except that that goes away over time as well the businesses continue to get marginalized and constrained preponderate at 20 times forward earnings which is where interactive brokers is right now in my opinion in this environment, even though the stock has been cut in half over the last couple years, still too expensive. >> yeah, i would say look at ameritrade this has gotten hit the hardest

of all these the stock estimates are coming down for next year and have gotten kind of cheap i look at this and say you're going to see consolidates in the year and buy those consolidated i expect ameritrade is going to be one. >> if you don't like banks you candidate like these if you think about where the businesses are growing you have loan exposure abconsumer credit exposure to extent they reached out to that wrmd i'm neutral here i don't think- dsh injury these guy haves a better handle on their business than we do frankly which means they are in areas where they have sticky asset pools. that's really what it is about, the balance sheet. if you look at the core bread and butter business it's kind of going as we said going the way of techno techno bird don't chase them. >>reporter: we have more ahead and "fast money. here is what's coming up next. >> announcer: the next big short. the steve iceman of big short fame here is he tells you where

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welcome back to "fast money. you may our next guess from the big short. one of the investors shorting the house bubble before it crashed ten years ago. now eyeing a few names he shorts this time around let's bring in steve iseman. good to have you back. >> thank you. >> obviously the big short that was a macrocall. are there macroshorts in the market or big bubbles or inefficiencicies you see. >> i don't see a systemic problem. the banking system is in the best shape of the 30 years i've

been analyzing banks is there going to be a recession next year or the year after. i don't know i think we are in a global industrial recession as we speak. thaeps not the same thing as a recession because industrial companies are about 10 to 15% of the economy. but i think when the industrial companies report it will be pretty universally weak. almost without exception >> a lot of people have made a lot about how rates have been close to zero or below zero for a very long time are there any sorts much bubbles that have formed around that dynamic, or no >> i mean, are there pockets ever bubbles qe to me is what i like to call monetary policy for rich people. it raises asset prices and zero impact on the economy. it has some very negative aspects to it. in other words if you are a saver it's not helping you it's hurting you. so i doend find qe is hechl to

the actually economy it helps asset prices to go up. is that a bubble the market is not expensive it's not that bubblitious but it has caused asset prices to go up. >> let's talk about some of your individual ideas i think that all the times that i spoke to you the past couple of years you've been short deutsche bank are you still still short doichl bank. >> still short doichl bank three years and running. >> what will cause you to take off the short? because it has already hit record low after record low and record low >> the problem deutsche bank now suffers from is they're trying to shrink themselves to profitability. one thing we learned time and time and time again post crisis is that's impossible and so they're going to shrink and they're going to become less profitable i think the stock goes lower and then we'll see >> does it go under? i mean, this -- i mean this is. >> -- banks go out of business for funding issues stoo.

>> um-hum. >> there is no funding issues for deutsche bank. this is a profitability problem. >> is this ying iks short or have you been short other german commendation kmerz banks. >> not other german banks, the european banks can we boil it down to a appraise or sentence what does a bank do? it sells you access to the balance sheet for a price. and so if you want to calculate what's the absolute return of a bank, it's return on assets, the whole balance sheet. they multiply that by referring and get the repaoe limes l gets roe pch the problem with banks is they sold access to the balance sheets too keeply for decades. and the r.o.a. has gone down post crisis and the referring has come down for regulatory reasons. that's the problem with european deutsche bank is just really the extreme example of what playings most european banks all over the

continent. >> so with the e the cb trying to reflate there. >> that's hopeless. >> hopeless. >> hopeless pqe in europe -- zero rates or negative rates what does that mean? i think it means it created global overcapacity. because every stock buyback has been done. every deal funded, every p.e. funded, every venture capital funded every start-up funded. what you have is gloelk overcapacity and deflation why would anybody think that doing more of the same thing would cause inflation is utterly beyond me. i think what the ecw is doing is a perfect example of trying to do the same thing over and over again. and expecting a different outcome. that's the best definition of insanity. >> but that sounds systemically horrendous ultimately. >> it is systemically horrendous. >> and the assumption that the

central banks can print money and it doesn't matter? is that the funding argument we talk about 17 trillion in negative yielding assets that sounds like a bubble. >> they can keep funding look at joopen japan's debt to -- government debt to gdp is 240%. we're at i forget now 125, something like that. so we get two times more to go and whose rates are lower? so, i mean, i don't understand completely why japan's rates are lower than ours. i only know that they are. and they have a lot more debt to gdp nan we do. so, you know, what causes interest rates to go up in a world of qe is above my pay grade at this point. >> steve, what do you make of -- we were just talk bag zero interest rates, qe it's obviously great for people who own risk assets. if you think about when is different this time as impaired to 20 years ago valuations are concerned we saw some companies come to public markets and able

to be funded by the zero interest rate environment. itching i'm thinking of ub he shall 807 billion-dollar. >> now it doepts. >> then wework originally at 47. >> bonds at 0%. >> and might. >> maybe 15. >> my go to zero my question is all the companies were funded by this environment. dissplmd sbmding is companies and see a bubble are we seeing the reckoning of thatten oh the backside. >> it's possible that bubble has broken to some degree in that every ipo -- i'm not picking on anybody smile direct for example which -- i think it went public at 23. where did it close, 10, 11 so i think the public's appear site -- the public's appear stiet to take private equity out or venture capital out for companies, no matter how booed good their ultimate business models may be but that don't make money i think at least for the moment is done now what's that going to mean

for silicon valley maybe it means god forbid the companies have to learn how to make money. >> some of your other shorts you spoke publicly about, zilo. >> yes. >> and tesla. >> yes. >> what is the short. >> still short both of them. >> still short both. >> yes. >> what is the short that you are the most excited about >> i have to say those would be two of them. >> zillo and tesla. >> i think zillow has created for it's cech perhaps the most dangerous business model i've seen in a very, very long time. >> because they started house -- >> they are flipping houses. the ceo i think last name is barton is without question a great internet investor. but i think the example of zillow is a case of genius is not always transferrable you know, for example, some people might think i'm a good investor but my wife doesn't think i'm too bright when i come home.

and/or you could be a great physicalist but you can't ride a bike so you could be a great internet platform creator -- and i grant you barton is. but the business of buying homes, flipping them, requires making a good investment decision at a very, very low margin business. and it actually requires managing thousands tlouss of human beings because the internet is not going to paint the house for you. a person has to do that. the internet is not going to pull the carpet out of the house. a person hassed that and this is a business -- the problem with the business is that internet platform companies love to talk about the t.a.m., wax poetic. >> total addressable market. >> right when they announced this the ceo went on about the t. chl a m. for ten minutes. like poetry tp the problem is there isn't one t.a.m. there is thousands of local

t.a.m.s and they're all different. and the ability to make mistakes in every one is high this is not a business you roll out quickly because it's so local you want to learn from your mistakes. and this company is doing this so aggressively that it's bound to make a lot of mistakes. >> are either of these shorts, tesla or zillow, are these shorts that you go -- basically the bet is that they go out of business in some way they go bankrupt. >> that's not my bet i'm not making that bets i'm not making the bet tesla is going out of business. it's rare to make -- especially in a world of zero rates where everybody gets funded. >> right to make a bet somebody is going out of business i mean the problem is also when the stock is at 2. chances are it goes to 6 before zero. >> do you think there is misrepresentation in the stories in other words the public is not getting the transparent or accurate read in the balance sheet. >> i think with respect to tesla, he likes to pull a schtick everywhere

there are four things that matter with tesla. the deliveries, the margins, there is then income and cash flow and for at least for the last two quarters what he likes to do is tweet that they're doing railroad very well on deliveries and the stock tends to go up and then last quarter the the other three variables are terrible and the stock comes down so yoentds why that's allowed. >> right. >> but that's -- he placed this game again where he tweets how great the deliveries are we see how the rest of the earning eyes are when we reports. >> everybody asks you about what you're short because of big short fame all that stuff. >> right. >> what's your favorite long. >> my favorite long is a cup called motor ola solutions >> okay. >> it's a little obscure but about it's not small cap it makes emergency communication equipment for police, firemen, et cetera. >> right. >> it's good management. well incentivology oply. lightly regulated business has

gotten better the last couple of years. i don't have to worry about china. don't have to worry about a recession. it's about as idiosyncratic a long as you could imagine. >> steve great to see you thank you for coming buy. >> thank you. >> steve iseman, knew berger bermen >> or like me no discernible home, here, at least he has something going it for him .deutsche bank is fascinating. wave been talking about it when i hear steve talk he is short because it's a bad bank. that's good enough reason. my concern would be it's not only just a bad bank you know, there is a derivatives book there which could potentially be -- i heat to use the worded catastrophic but there could be systemic risk but i'm with him on deutsche bank even at current levels still too expense sfwleef coming up united health surging today we get the traders take on the big move isafr money" back right te th in the human brain, billions of neurons play in harmony.

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crisis close a settlement $18 billion. that's according to the wall street citing people familiar with the discussions that's days before the first federal trial is set to begin monday in cleveland where the companies along with pharmacies like cvw abwahl green as wal-mart named four drug makers reaching settlements with the two counties involved while teva remains the sole crewing drug maker. the settlement if reached would address the lawsuits broadly and the $18 billion would be paid over 18 years johnson & johnson is involved in the discussions to ibt contribute additional money. shares of the drug driblters cardinal health, mckesson amer source bergen process. up quite a bit after the settlement agreement split among the three and paid over 18 years may be less than wall street feared morgan stanley estimated base case viability for the 8.32 billion for cardinal appear mere source bergen at 6.9 pl billion bergen declined comment while mckesson and health didn't

immediately respond. j & j is open to options to resolves the cases include strmt. >> twab it would be pallett tri if the three drug districters and j & j separate is over 18 years. >> $18 billion. >> is j & j in the three. >> they might kick in money. >> okay. >> and then you spread that over 18 years. >> right. >> and it's almost nothing. >> wow. >> well that's i guess why they're up big in the after hours. i'm surprised i would have thought this has been not priced in this but the idea that there would be a global settlement has been happening that's interesting. >> yeah, i think this is -- i mean this is an extraordinary result if it's the final result. i think again federal dynamics up ahead i think there will be more people coming forward. i think this is still an overhang but in the short hang i liked j & j yesterday i like it more today. >> tim is right about j & j and mckesson rest than 9 times

forward earning. if this is the last news until earnings you have to ask the question do you want to be short the name the answer is no i think there is further room upside a specifically mck and cardinal health. >> sticking with health care check out united health topping the tape after crushing earnings and revenue expectations before the bell raising full-year guidance strong earnings report might be one of two potential major catalysts for the stock. the next winnebago the presidential debate tonight. health care namely medicare for all likely to take center stage. cha should investors expect from the debate i think the real question is here you have an example of the fundamentals for this company look great yet there are the political headwinds. which do you say will reign supreme on the price action. >> you hope fundamentals because the political stuff is rhetoric. maybe you hear it tonight maybe you won't. maybele be a ar on on capitalism tonight. who knows. but to answer the question it's

justified. we have talked about united health a while i'm surprised it's taken this long in terms of getting the levels i still think there is room on the upside at the trough on 13 times forward earnings at a company historically trading close to 18, it's just too cheap. and i think this earnings results tell us what you need to know. >> it's interesting, when you talk about the run the stock had from the november 2016 to election day to highs last year it nearly doubled op on a lot of politics, a lot of regulatory issues being taken in which. when you think about the downtrend of the stock of the last year it's maybe making sense. tonight you will see the candidates on the crowded stage move towards the center rather than further left which is the medicare for all and these stocks should kind of get a bit of a lift on that. i think over time unless warren and sanders make it very clear that they have become the front runners then the stock have thus. >> sorry kaern. >> i'm long some anthem i sold

some before. i'd sore sort of about be- -- there was good news if the medical loss row ratio is sloor similar to united health that's great. cheap on fundamentals, cheap to itself it's also priced in a lot of the warren sanders rise. if they end up strong tonight and the stock trades down tomorrow, i think that would be a good opportunity to buy it. >> it seems to me the stock is trading on fundamentals. how could the strak stock rally on unexpected politics it doesn't know the stock was concern investors were concerned about 2020. a company giving 13% growth for 2020 and basically said we think this is conservative. you can't tell me thestock is moving because they feel better about the political story behind the company. they feel better about the fundamentals you can't discount the importance of that being the story story i think that what we are saying guy said the politics are what they are but unh was trading as much about uncertainty related to the core business and business now that may change in 2020.

but i stay lopping the stock >> up next, netflix gearing up to report tomorrow in the options market implies huge moves. we have much more "fast money" right after this nature's bountn and nails step one. it's the number one brand uniquely formulated for silky hair, glowing skin and healthy nails. nature's bounty, because you're better off healthy. you should be mad that this is your daily commute. you should be mad at people who forget they're in public. and you should be mad at simple things that are unnecessarily complicated. but you're not mad, because you're trading with e*trade, which isn't complicated. their app makes trading quick and simple so you can strike when the time is right. don't get mad, get e*trade and start trading today. through the at&t network, edge-to-edge intelligence gives you the power to see every corner of your growing business. from using feedback to innovate...

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coming up it's a moment of truth for netflix as it gears up to report erpgs tomorrow and options trader bet the results could be a show stopper. we will explain. we're live at the nasdaq in times square much more "fast money" still ahead. sometimes, the pressures of today's world can make it tough

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welcome back to "fast money. the current raises tomorrow on f.a.a.n.g.'s marquis feerpt presentation netflix reporting after the bell tomorrow the stock count more than 20 peppers since the report in july the next guest says tomorrow's report could be another show stopping move. let's bring our managing director of equity he is the derivative bonman welcome back. >> nice to be here. >> what are you seeing in the options market in terms of implied move. >> options imply a decent move look at the money straddle blieg 11% move move. that's significant the last four quarters moved 5%. the highest of which has been 10 if you look at options volumes, calls and puts calls with about is li 1.25 times puts but open interest liens towards puts it's tough to see whether traders come in with buller or

bear err bid net-net people expect volatility. >> we can't wear tell whether people are leaning bullish orb bearish into the print where do you stand. >> it's tough. as dan says, these one up one down moves aren't moves i like to plan. particularly if you look over at historical implied volatility. it's tough to be long options. and get in right you can get the direction right and still end up losing money because the option premium is so rewrote bust. >> gets go through the different stories let's say we get a plof to thedownedside what do you see. >> on the back of the three things they focuses on most of which are the cash burn and ability to retain domestic subscribers. if they miss, look at the chart, there is like a two-year support channel down around 240, 250 that's going to be a relevant pressure point in the stock. that's where i'm looking. >> right and on the upside. >> given all the short interest in the stock we could see a pretty aggressive back up retracing some of the loss we

experienced this year. pretty volatile. >> you saw the action here. >> bonman makes a great point if you get the magnitude of the move rung wrong it's tough and the like he said the biggest move over the last four quarters 10%. that was the first ever north american subskrier scriber miss. the likelihood of that happening again is not great but to his point if they miss again and north american subs do go lower the two consecutive quartering it's back to the level he referred to on the kmart. >> back to 240, 250. this company has to profit itself in terms of profitability discussed tobt in terms of the international subs we talk about competition all the time but right now this is -- we can't throw these guys into the same class as a lot of pipos that don't make money. but they need to make money. the cash burn is unacceptable. i think investors are pushing

back. >> we haven't seen yet the competition, right, apple plus and disney doesn't start until november 12th for disney november 1st for -- we don't have one quarter we have no data on competition. >> we don't. >> just fear. >>en a i know the roku news was difference but you see how quickly they back. roku was 103 i want 135138. the other side of the 250 level is sort of 317, give or take oddly enough that's sort of the 50% retracement of this spring's high, 385 or so and the recent low we talked about the 250 low. so i don't know. it's a coin flip but i'm more inclined to think people will flush themselves out and any semblance of good news gets us above three hundred. >> tune in to the live shod show this friday 5:30 p.m. eastern for the full show. up next, time trades ♪

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time for the foinl trade tim. >> like the reaffirmation that united health 250 as a level stay. >> chairwoman. >> looking for ways to hedge the portfolio. short ayg, mark trades down this goes down with it.

>> dmz. >> lyft is bottoming into the october 30 earnings. >> we need the yank yankees scoring runs. >> i know. >> amgen into the earnings later this month. >>ee y sou tomorrow for more fast "mad money" starts right now. >> "mad money" starts now. mchld welcome to cramer -- you want to make friends i'm making money my job is to educate you cull me at 1800747