price performance this week. also a reminder tomorrow 3:00 p.m exclusive interview on "closing bell." goldman sachs chairman and krae are ceo david solomon so much to discuss for the banks for markets, macroand of course goldman sachs in particular. looking forward to that. we are out of time though. that does it for "closing bell" today. >> "fast money" begins right now. live from the nasdaq market site over rook looking new york city's time square this is "fast money. traders on the derrick pete narj karen finerman and guy adami with the after hours axe earnings season kicks in high gore netflix, ibm csx on the move after results. net friction the one to watch with less than an hour until the conference call. we have full team coverage to break down the results gene munster firing up the red phone in minneapolis we begin with jewely boorstin riff in los angeles. julia. >> melissa, netflix shares soaring now up 9% despite lower

than expected guidance investors reasaurd by better than expected earnings per share as well as better than expected international subscriber growth in the quarter netflix adding 6.3 million international subscribers. above projection while u.s. subscriber growth did fall short of expectations. but investors may also be reassured by ceo reed hayesings giving frank comments in the letter to shareholders with competition. this of course comes ahead of disney plus and apple tv plus launching next month hayesings saying they've been preparing for this new wave of competition for a long time, writing quote the launch of new services will be noisy, maybe modest headantened near term growth we have tried to factor that into guidance. in the long-term we expect to continue to grow nicely given strength of service in the large market opportunity now the other bright spot that hayesings is stretsing in the letter to shareholders is international growth hayesings saying they are

expanded non-english language original ofrpgs because they grow penetration in the international markets. he says they have globally released 100 seasons of local language original series with plans for over 130 more next year alone he also says they're on track to achieve full-year operating margin of 13% and next year targeting another 300 points in operating margin expansion of course, we'll have to see what else hayesings says in the netflix video call starting in an hour. melissa, back to you. >> julia, thank you. julia boorstin in los angeles with the netflix details let's go to steve. you literally bought netflix minutes before it released earnings. >> minutes before the "closing bell." minutes before they came out and reported earnings. i new it was going to be bin ar, either up $20 or down $20 and instantly down $20 i thought it was losing trade but i figured it would reverse either which i'm holding the position i saw 302 and 318 as resistance.

i'm probably out much it tomorrow if it holds the gains which is a big if with netflix. >> right. >> bon owin was on. >> maiden voyage on the "options action." i don't know if you were watching he did a fantastic job but he talked about the move of this magnitude we said it a while i get a lot wrong we did this right. we said netflix given a couple months ago probably trading down 252. if it holds there you buy with both hands that's what happened and last night we said to the upside based on the move you're going to potentially see 317 that's exactly where it traded up to. so 50% retracement of the may high of the recent low, 3717, this was a god quarter i understand that u.s. is saturated. the international growth is great. we start reading between the lines, guidance not fantastic. i think in my opinion, you absolutely have to take the money and run now. >> you characterize a launch of the various streaming service as

modest headwinds, as it being noisy. i was talk a analyst today saying it it's not the fourth calendar quarter where there is the you have toughest competition. i want the first and second quarters next year where people get the serviced and decide what they do. >> until they get traction how long does it take to get disney plus out there -- you'll have a bunch of big subscriptions at the beginning, right. they'll both do apple, big pushes, we're not going to have a sense. there was a lot to like about the quarter primarily that expectations were low going in that was sort of interesting i mean, for me, i just -- too expensive can't be long it, competition coming i know pete has been long it a long time. what do you do, sell on this now. >> i keep selling calls again the the position i have to roll the calls again i've been doing that a while the focus at least by the reaction right now is the focus that should be there which is international. >> right. >> i look at the 60 plus million

they have u.s. right now or north america. i don't know how much more they can get from that. but if the international continues to grow which it has been and that's been the outperformer for them we are focusing on the right thing. in reed hayesings talked about may some short-term headwinds, obviously with the launches of everybody else but they have a good head start. and looking at the international head start and all the languages. he talked about 100 plus language they put out there. i think india is the key right now. and if the day ever comes they're able to get into china that could be something very, very interesting as well. >> how about the key though of how they fund the new content? so that's going to be a question, do they continue to raise prices is it. >> can they raise prices can they raise prices. >> in the face of apple at 5 and disneyland around that level i'm holding netflix -- the stock maybe but the streaming service i'll probably own disney and i'll probably own apple. i don't know. >> the streaming services not the stocks.

>> exactly by the way i own two out of tleet. i don't own disney i will own the streaming services. >> right. >> but how many other people can afford to pay for three or four of them. >> i just look at that content that they put up i say oh my god that's hugely expensive. talking about all the local content i think, wow, okay, we are in for a massive continual spend. it's not like they are spending to build and that's it you built the content. >> the business for netflix than say disney which nay be building off stable of content that appeals to people around the world. >> right. >> this is the cash burn again once again back to the cash burn. >> that story is there the whole time. >> except for the competition changed. >> the competition changed that's the reason why i think the stock went down to two we mentioned last night last quarter the first time in a while seemed like reed hayesings was concerned about the coming competition. and he never been before at least in my recollection in terms of prior conference calls he actually seemed concern flushed a lot of people out.

now that's out there that move to 252 got everybody out. now what you see is everybody piling back in i think this is an opportunity and pete can speak to the options again to take money off the table. s in a textbook 50% retracement of the spring high. >> before pete gets in on options, the level that guy is talking about, the 252 is $20 above the december fall off a cliff 2018 level where netflix traded down to that was an unrealistic level, 231. when you test lower levels you get more bullish process it's all about positioning opinion the trade i made today was about the fact the stock was down 30% or over 30% from july. it was all about positioning tor me. >> the last quarter was waufl. 25%, 30% whatever to the downside and obviously everybody seemed to be ratcheting down either price targets or whatever. and rg was negative going in so the positive was when they had the international numbers strong, that seems to be what everybody is reading right now.

>> sigh of relief. >> yeah, sigh of relief they're there and treading water and how much longer? i think a few more quarters. because it will take time for the competition to get after them i wouldn't say this is a huge long-term hold for me. but i've done okay with this thing selling calls every month the last year and a half or so i think i'll continue to do so. >> sounds like the trade is volatile the next two, three, four quarter zblos or four hours. >> literally. >> we got that video call that worried video call where they take questions that are preselected or whatnot. >> we have a much different conversation tomorrow at this time no question. but again, this is one of the stocks you have to trade the stock don't let the stock trade you. to trade it now is taking money off the table what's been a significant move over the last four quarters. >> you can't be married to this stock. when you look at the valuation, the pe alone you can't be married to it. you have to trade aggressively or shouldn't be in it. >> for more vex let's bring in

luke vent yurps founder and "fast money" friend gene munster what can did you make of the quarter. >> i thought it was positive relevant it active to expectation. but the move in the after market masked the underlying cautious trend we have seen in the business i think your recap has largely covered this but i want to emphasize in piece, is that ultimately for this to work they need margin expansion and continue to grow subs and we're entering a multiquarter of really uncertainty. i also when we think about the guidance and relative to the uncertainty and some of the comments they had to help investors frame in december. it's important context that historically this has been a company that's given guidance and exceeded the subguidance in the june quarter they missed by 47% and then they took this more conservative view on september. and they missed that by 3% the concept that this now 20% decline in their guidance for

december is a safe number, i think that that is -- is unknown at this point. and i think, mel, you hit it on the head too it's not about the deasy but ultimate lip what happens in march. and so i think that this was positive to expectations but this is still a story that i think would be difficult to own. it is still $140 billion market cap here this is compared to disney at 240 billion. this is still a big market cap relative to what's going on in the underlying business. >> what levers do they have to pull to expand margins at this point, gene? >> i was surprised at the -- i don't know the answer to that. i was surprised at the commentary that they are going to expect margin expansion for nextier, the 300 basis points. i don't know how you get there because the easiest way to get there is through price increases which is now off the table i think that that is a hard off the table. and you continue to need to fund

this with -- quit aggressively the one opportunity is if they can get cheap debt they have $12 billion in debt now -- and continue to fund content with that, there may be an opportunity to have some sort of tradeoff there where they can get margins in entire. but that's the core question how do you compete in a more -- operate expanding margins in what is a very different competitive environment than we had a year ago >> gene, when you look at apple and google -- i'm sorry when you look at apple and disney, they have other sources of revenue to fund their content duration and whatever else they are looking to do. when you look at netflix, they are a one-trick pony a can netflix compete against that and b does anyone buy netflix with in valuation just to do a plug and play? or is it it that ship sailed. >> i think on the acquisition side the ship has sailed especially what we are talk bag.

you can imagine conversations in the board room looking at recent pullback of netflix over the last six months and think of the opportunity there. they're asking the same questions about the next year. the business could be valued very differently a year from now. in terms of the business model -- and they're making money on their unique content where disney has other avenues and apple does too i think that's a critical point to the story what that really means is that the -- those other players, apple and disney can sustain lower prices longer, essentially can freeze out some of the netflix price increases. now, if any decide to move higher, disney and apple on pricing that may leave some oxygen for netflix but i see that as unlikely over the next year. >> let's flip the script, gene, could netflix be wanting to buy some sort of you library of content itself would it be able to do that. >> they could. i think at their debt load right now it would be unlikely i want to be clear too

is netflix goinged to be around in five years. they'll have subscribers it shouldn't be $130 billion market cap in my analysis i think that avenues to advance what they're doing through content in some sort of acquisition would be modest compared to et competitively what's going on. >> what should it be then? if not 130 in market cap what should it be? >> it's for the investors to decide but i -- it's a 45 multiple on next year. i think a more reasonable multiple would be 25 multiple. >> wow. >> i think maybe -- that seems reasonable. >> all right 20 terms lower. grade it, gene, the quarter. >> i'll give it a c plus. >> ooh >> you know, the -- the stock reaction would suggest a higher grade. but ultimately this trend is there is some cautionary tales here and so i would stick with a c plus. >> all right gene, great to see you thank

you. >> thank you. >> gene munster of luke veterans c plus for a low-quality hop in the after hours. >> i'm so happy i wasn't in professor munster's class thp that's crushing. but a c plus is a good grade from him >> really. >> i would agree steve talks about positioning. it's been about about positioning because if it came in trading 325 we'd been talk bag at different story right now. got people off sides fourth quarter revenue guidance below the street domesticed adds half what the street was looking for oh the fourth quarter international adds a million less than the street was looking for. believe what they're telling you. next quarter not great process if they tell that you this is the great opportunity to take profits. >> and it should be a good quarter for them actually. that's supposed to be one of the strongest parts of the year the fourth quarter and then the competition accelerates after that injury gene's c plus makes sense. the outlook wasn't very good i look at netflix, a trading

stock. i look at disney as a hold stock. i own disney owned it a long time. >> and apple. >> and hold it wint. apple as well. i wonder who gene things who is the most competitive knocking netflix out? i think there is somebody out there. >> the existential of all of them. >> all of them. >> what if they don't knock netflix out but curb growth? it's priced for growth. >> right. >> they curb that growth what multiple. >> i would answer my own question with disney is the reason ai say. >> the first time somebody agreed with you. >> once in a while anyway. the reality when you look at disney is and what they put out and the content they have which actually goes to the area we want really when you look at where you're looking, outside of there, the younger children, all of that -- that capturing below the 25-year-old type crowd, that's what they want. disney has that. and i think that's why disney is a threat. >> gmt and united auto workers reaching a tentative dole to end the strike we tell what you it means for gm

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welcome back to "fast money. big developments between general motors and the united auto workers let's get the details. >> we have a proposed tentative agreement, a tentative agreement if uaw leaders from around the country meeting in detroit tomorrow the vote that they accept this and then they pass it on to the rank and file who may take up to two weeks to vote there's a little bit of something in this for both sides 50/50. for the uaw they caseyed the temporary worker concerns they have there is a pathway to permanent jobs for those workers that was a concern for the uaw they're keeping one of the assembly plants that has been idled and was scheduled to be shut down by general motors, the plant in detroit it will build an electric vehicle. lordstown, the two other plants, don't expect those to stick around and finally there are no models moving from mexico that's what general motors said all along. it was not planning to do. the uaw says we want some

production up here it's not happening what has been the strike impact of a -- this strike that has gone on more than 30 days? by one estimate the cost to gm at least $2 billion. all of the u.s. production has been stopped for 31 days and much of the production in canada and mexico greatly reduced over the last several weeks. mainly because the suppliers haven't been able to ship parts to the plants. as a result they've had to shut down production. as you look at shares of general motors over the last month you might be looking at this and saying well shouldn't there be more of a pop back here? this is basically what people expected a little bit of a pop today but not back to levels we saw a month ago. remember the workers stay on strike, melissa, until the leadership says, yeah, go back to work while we vote on whether or not to ratify this deal, or stay on strike while a potential vote on ratifying the contract one last note look at suppliers, all moved up subsectionly between 3% and 6%.

mainly because there is an expect aches that this deal will get finalized and they can once again start shipping parts out to gm factories when they start running. >> let me get it straight, phil. they can nouns a deal but until are the fiee >> two ratify cakes. >> two radmann ratifications >> you need the leadership. >> the clock is ticking. >> correct you need the leadership to say we think it's a deal. >> right. >> and then to say, either stay on the picket lines or go back to work to the rank and file my gut says from talking with people, they're likely going to say go back to work. it's tough to tell people while we vote on this the next couple weeks stay on the picket lines not impossible it could happen. but generally speaking when i talk with people most expect you see the workers if the leadership agrees to the deal that they're saying go back to work while everybody votes. >> karen has a question. >> what's the president for the leadership saying, okay we grow we have a deal here but then ultimately it not getting the

larger vote. >> it has happened happened with fiat chrysler four years ago. the leadership from the local union from around the country four years ago looked at the deal that was initially agreed to by the negotiators and fiat cries remember and said, are you nuts we don't like this. they went back to negotiating table. three or four days later they came back and said okay we addressed concerns so it has happened, karen. you would think that after 30 days and a lot of constant communication, between the negotiators, the uaw national leadership and the local leaders that they are going to have pretty much an idea of what to expect going into the meeting tomorrow >> all right phil, thank you. phil low bow in chicago with the latest on gm appear the uaw. karen, how gunning this tentative deal >> well i think 80s good thing for sure i mean the damage is -- much of the damage i think has been done already. the stock which i am long. it can't get out of its own way regardless of the numbers they put up, regardless of the

environment we're in that is frustrating. i'm just -- i'm staying with it though >> so techically the stock it's back from july has been a making a series of higher lows, lower lows also popped 10% into the news. i guess you have to ask what's more likely a china trade deal phase one or this deal this is more likely getting done. >> yes. >> you are long stay long. ford up 18% year to date this up 9% year to date but ford's chart isn't so great injury it's an auto problem. >> what year is this 2019. >> 19. >> you realized that most of october. >> did you just ask what year. >> i got old i have to make. >> it has to sink in. >> maybe he fell and hit his head. >> the point, guy. >> the 2014 that's like five years ago. >> yes. >> you are on fire tonight, guy. >> but i mention that because. >> snaps fire.

>> guess where gm was my point is the stock market has gone up significantly .. the last five years some of the greatests years for auto sales in the history of mankind. and general motors is unchanged. that tells you something you can talk about valuation all you want but the stock is grim death in my opinion >> well you can read more about the tentative deal between gm and the uaw on the website much more ahead on fast here is what's coming up. >> will robinson, danger no, will robinson, danger. >> a major warning for your money. is the consumer finally showing signs of cracking? we'll debate it. and later, a sin city showdown the big bets on big building on the biggest strip. we take you there live when "fast money" returns on as a reliable phone company. (woman) but to businesses, we're a reliable partner. we're engineers. cloud architects. developers. (woman) data scientists.

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welcome back to "fast money. wall street starting to get 2020 vision we heard from two opportunities of investing today on cnbc both laying out what they think will happen to the market if president trump loses the election >> if warren is elected president, my opinion, the market drops 25% bernie sanders same thing. >> and that sentiment echoed by franklin temple ton mark moebious a short time ago. take a listen. >> that if trump is not re-elected, the market will go down im, i don't know how much. but 20%, 25%, is probably possible >> let's bring in deon suzuki at richard bernstein advise advisering would you agree. >> i think listen the market will stay short-term focus when i you get the election polls in.

i think that in the near term, you know, i think my view is that you're choosing between -- you want the wrench or the belt. i think there is things the market has difficulty stomaching in the near term because with trump the more popularity he gets the more likely he is to get re-elected the more likelihood he puts pressure on trading partners clearly the market don't like that on the other hand, you know, we know that the market doesn't like higher taxes. we got the corporate taxes now rolling them back with the other taxes, i think you know from a short-term perspective the market will prefer trump because it's the devil they know versus the devil they don't. >> but in the longer term. >> longer term. >> you think it shakes out. >> the issue right now is that we are losing trading tie was trading partners we don't have any end of this in sight the uncertainty is weighing on businesses the longer it goes on you hear it from the corporates, the longer this goes on weighs on growth and the more likelihood we go to recession. >> is part of that weighing on the consumer in your view after the retail sales numbers this morning. >> i think it is probably everyone you know that

doesn't care about wall street and your family when you sit ornd the holiday dinners is starting to talk about is the recession i'm reading articles about recession. it's showing up in the consumer numbers. i think that you know, it's the one area of the economy that people are pointing to as the strength everything else is rolling over. people are hanging their hat on the consumer i think that's a little bit misplaced. if you look at actual numbers from the government they peaked a year ago in terms of the personal spending numbers. they've been coming down and i think that's the going to be the continued trend are they falling off a cliff no but what did do you look forward to see where consumer spend something going. confidence pay bills, which is the job, you look at wealth and you look at their ability to borrow money all these things are slowing you know, job growth probably -- if you look at job growth it's the slowest since 2011 and the leading indicators whether the conference board employment trend index or other indicators they're showing job openings have started to roll over. consumer confidence already

rolling over you know we're still at high levels nothing is falling off a cliff but directionally the wrong way. the consumer within the credit side - we're hearing from all the banks it's the one area of credit where banks are tightening lending standards that's going the wrong direction as well. you look at all these fings if you the get more volatility in the stock market market which i think you will that's not a great recipe for continued resilience from the consumer. >> no question that consumer spending money process brian sullivan about not getting a car in the newark airport couldn't get a parking spot packed >> packed. >> i would exit that doesn't mean they should be spending my pushback what derails what could derail consumer -- understanding it might be turning what derails consumer confidence. >> i think that stock market volatility is weighing on consumer confidence. if you get a big draw down in the market five or ten% with the fierce of recession along with layoffs. i think job growth is slowing. i mentioned job droegt is the slowest since 2011

job openings are rlg over. if people can't mold a job anymore. csx they held the line on costs one of the reasons they were cutting labor -- the labor forcing down 6% year offer year. if you see that trend continue as companies rein in costs alongs with the they're dealing with rising wages that could actually cause cracks more cracks in the consumer. >> let me pushback on that a little bit we see a lot of wage pressure. >> um-hum. >> a contradiction to you're saying slowing jobs, right the employed worker is making more. >> yeah. >> and there is pressure for them to make even more money wouldn't that sort of push the other way on your theory. >> that does offset it i think if you look historically that's actually pretty normal toward the enof a cycle you see inflationary pressures workers are making more. but then companies are making less money growth is rolling over laying off workers and that at some point the wages roll over wages is one of the more lagging

indicators in the numbers. that's sore of the dynamic you are faced with more of a timing issue than anything i think the fact that wages may go up in the near ferm cpi may go up in the near term puts pressure on the fed which is the other part of this because you know typically late in the cycle they have to contend with slowing growth and rising inflationary pressures. if you just take oil prices stable from here it would imply that you know headline cpi is going to be well above 2 by the end of the year. >> dan good to see you a. >> thanks for skrg me. >> dan suzuki rba. not surprising his sector picks with staples health care abreal estate and utilities decidedly defensive. would you agree. >> i would agree with the picks. but i'm going back to one of first statements he made where it's the devil you know versus the devil you don't. you have one devil nas up at all-time high was deregulation and lower taxes and you have another devil that is approaching a federal income tax rate of 70% to 90% the market is not going to like

that i do like the defensive picks. but i think the market is pretty much a binary things right now trump is market friendly the rest are not. >> would you agree >> in terms of the -- uts it's funny prior to the 2016 election there were people that said i miechb one of them that the market -- if trump gets elected markets go down 20%. for six hours hast. >> that was because people thought he was blowing up the world not because of deregulation it's not still not over. >> a health care makes a lot of accepts. saw saw the unh pete talked about this the ufrmt nh numbers outstanding. valuation at this price too cheap. that's one stock i get it but even the big cap pharma names make sense in the environment. >> coming up, the earnings aletellier and ibm and csx both stocks moving 5% down and 3% up on csx betting on the turn around hear from theeo c of penn national

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with dedra bosa in san francisco with ibm earnings. >> melissa, another quarter, another decline in revenue, the fifth in a row for big blue. speaking volume foss ibm the company trying to turn around under ginny rometty investigative and next two vechg they were urge iffing signs, the first quarter since the red hat deal, the largest acquisition ever and represents the big bet on hybrid cloud. ibm said red hat post-ed 20% roo rice in revenue as a stand alone. it's benefitting from the scope and scale of ibm now investors of course will want more evidence in the quarters ahead the q and a session just kicking off. but i-thinking we're going to hear lots of questions about how this deal is going and another bright spot was cloud revenue growth, grew 11% from a a% growth rate last quarter. a healthy improvement but trailing growth rates at microsoft and amazon so what went wrong this quarter?

it's legacy business weak performance in global technology services. that's its business. providing i i.t. services to other companies. dragged down overall revenue shares a big blue down in the after hours and underperforming the broader markets over the last year. back to you. >> all right dedra bosa thank you >> guy adami were you positive on ibm. >> absolutely for a while it looked like it was okay. >> i'm with you. >> and you know i thought the red hat deal maybe this figure it out. >> microsoft was able to do it five years ago they overpaid for red hat. they would admit that process. i understand the growth for red ha hat when you have the bichl machine behind you that's not -- i think we're splitting the atom when we say that with that said the legacy business is awful. it's amazing they can't get out of thurr own way so, look maybe this is a one off quarter. maybe they get the mojo behind them but it's one disappointment after another. i want to stay positive because i think maybe they turned the

corner but this quarter says not so much. >> and i would say that the problem remains at the very top. it's the problem since the beginning and continuing to be. >> you have a theory on this. >> the idea that jim whitehurst should take over red hat. >> of red hat. >> yes that's where they are going, the biggest acquisition, $$34 billion why is isn't that the direction like microsoft it makes sense here is the guy coming with the company let him run the company. because that's where they are moving to, away from regularcy to cloud number one in hybrid cloud they show growth i think they could show more. >> you stay long because of the that possibility. >> yes. >> if jim came out tomorrow and said no way, no way. >> i'm out. >> okay. >> i'm out and would be getting out at a bad price because people would beat me to door. >> let's move to csx, getth a pop after earnings frank holland back at headquarters with more on the move. >> csx with a surprise beat on

top and bottom line forecasting a turkey of 1 to 2% pull year. cs kpechlt getting more than 60% of revenue from the merchandise. automotive and petroleum and chemical shipments that grew 1% they said if not for a fire at a refinery in june growth would have been higher. the shipping of container was be revenues fell by 11% backup coal segment falling 10%. that weakness with coal production forecastsed to fall by 17% csx volume and revenue falling but analysts saw good things chris werth by saying from citi saying the solid performance is likely viewed positively for the group. we believe shares should react favorably to results credit suisse says oing we review it as positive. they demonstrated outstanding cost controls in the face of mid-single digit volume declines reporting record efficiencicy as it leads in precision scheduled

railroading. >> franking with thanes. >> karen. >> the costs are the key that's pretty kbref to have the revenue shrinking and get costs under control. normally doesn't work like that. good for them. >> the stock is underperformed the overall market up 11% year to date. if you think things are slowing then you can't be in the space but they have a 75% track record over the last two years of surprising to the up side. injury if they can control the costs and they can surprise csx is the probably the one that can do. >> but are they a bellwether for transports >> they used to be. >> the rails used to be. >> in the past. >> in the past but i mean there is nothing like as i mentioned i was out in the witch tau. i know we have to go in witch tau, kansas they have the freight trains going right through. and it's something romantic about railroads, no? with that said, 72 is consistent is in csx i like a good train. >> i a deep thought with a good train. >> the more you know. >> seems like the more you know.

>> coming up, casino stocks -- nice coming up up this year but one name is betting on a c suite shake upturn the odds in the favor. stormy skies for in cloud. poing the biggest loss since 2016 don't go anywhere. much more "fast money" right after this

welcome back to "fast money. shares of casino operator penn national gaming have been underperforming the broader market the past year but the company is roll the dice op a new ceo hoping he can deal investors a winning hand let's get to contessa brewer brewer with las vegas with the incoming chief. >> melissa, thank you. jay, you join me today on the heels of some incredible news on the las vegas strip, the sale of the bellagio for $4.25 billion mgn resort to black presidents, they'll rent the property. i know you come into the job in january. thinking that your las vegas strip property is undervalued tell me about the tropicana what the plans are. >> quick brktd we have been aquis active having acquired pinnacle entertainment a year yooig.

the martha valhalla and greektown resort in may. we have 40 properties across 19 straits. 40 quality regional say sets in the country but we levered up for the transactions our priority over the next 18 months is delevering the balance sheets we are lease adjusted netted debts, ratio of 5.7, 5.8 we want that down five times by the end of 2020. one of the things we are considering right now besides deploy the free cash flow to pay down debt is also we have assets, that have underlying value in the portfolio. >> tropicana being one of those look at the land value and land transactions in las vegas going for between 10 and $15 million an acre over the last six months, a couple of which were nounsed yesterday. and our property today is only trading on a multiple of eebtd iaaf there is land value. we are exploring what we might do to extract the value and accelerate the debt pay down between now and the of the year. >> are you considering outright

sale or would you consider what you've done in the past, selling the land under the casino to pennsylvania reit but continuing to operate it. >> we are looking at potential options we would not consider the reit option for in land, tropicana, the land value today is valuable for non-traditional gaming investors we are talking to a number of different potential buyers of land or all of the land that look a at it as retail cap rate opportunity or kondo hotel or entertainment opportunity. >> i got to ask you about mogul betting and sports betting becausis the talk of the global gaming conference. how important is this for penn's future. >> i mentioned earliy we are we are now in 19 states we have the brought are broadest footprint of any regional game country in the u.s one of the ways we take advantage of that, sports bet something legal in 20 states and launched in 13 backup we are live in 13 with sports books but we have the opportunity to be live over the course much the next 12 months potential i up to

to 12, 14 states. >> does scale matter. >> the more sports books you have, the more you have the opportunity to leverage all the technology you made the investments you made and we have an opportunity not just brick and mortar but also to consider online capabilities and digital capabilities and because we are in 19 states we have access to this opportunity across the country >> you have big shoes to fill taking over for tim willmott in january thanks for spending a few minutes with. >> thank you. >> thank you contessa. with jay snowden let's trade the favorite pick in vegas. pete. >> wynn. i look at all these i own a cup. i have las vegas sands and wynn as well and mgm calls. i like wynn because i think there is something about the trade war, china, ma:. but in terms of penn, they report on halloween which is as you know one of my favorite holidays

>> are you wearing a costume. >> boo by the way. >> will you wear a costume. >> if you want me to for the last half of the show. >> fine with me i'll ratchet that up, man i don't know when is halloween this year. >> on the 31st. >> a weekday. >> i don't have it in front of me i'm not rain man. >> it's 2019. >> yeah, give me a break i was on a railroad train. >> railroad trail. >> 10.5% interest short new ceo coming in tells a good story own penn into earnings at the end of the month. >> all right up next getting worked too software names falling hard. we break down what happened. speaking of software look at the cramer cam, jim talking with mark benoff, the subpoenaing interview coming up at the top of the hour on "mad money. live in times square, much more "fast money" still ahead

welcome back to "fast money. two tech stocks getting worked in a tough day for software stocks both of the names catching flak. and let's start off with workday. workday closed out the worst day since 2016 after several firms came out with wearish notes on

the stock. rb cutting the target by 6%. mccory and jeffrey shared concerns about increasing competition. after the losses workday is nearly negative on the year. but still carries of an average overweight rating from analyst does today's big move make the stock cheap enough to buy, pete what do you say? >> no, i think there is some pressure still some of the names they continue to the upside and people discard all the pe and fundamental stories. >> right. >> and i think people are starting to -- especially and we had dan on earlier talking about all this -- he is going and trying to cover himself and hide somewhere because he is looking at utilities appear everything else well if that's the case, these high pe names are the piers ones to lead to the down zblood the whole software sector was just obliterate >> huge pressure. >> adobe. >> plus the next one we are talk bag squloo right. >> they talked about growth slowing. when you you have a pe multiple like that like pete says there is absolutely no room for not just a miss but a slight decline

in acceleration versus what the street expected. >> plus morgan stanley came out with a cio survey saying it spend is lower going forward can't put suffolk in that. i think it's more about valuation. i think they will eventually be a spot where you can pick a bottom in these. but they have to get more air out of the the balloon for these stocks. >> from workday to work. and that of course is slack's ticker the reason ipo hasn't come out of the gates swinging it's down 9% from the peak on the first day of trading and options trading betting the stay put the i love the humor my mike clo in san francisco with the action. >> after we saw the weak performances on the open slack among them trading one and a half times nch a daily volume this morning and by the end of the day it had traded 2.3 times the average daily options volume the most active contractsy the november 25 puts about 7,500 of those traded for about $3.

i would oint out those are in the money puts and there was some open interest come in today's. normally when you see this decline you would expect that. maybe people owning the puts look to sell and monetize them but that's not all the story because the open interest was only 5,400 contracts traded over 7,500 contracts and many contracts were purchased what might be going on here is people who own the stock and think there is a chance it might rebound but not willing to take anymore pain might actually have been taking advantage of some of the put sellers turned buyer that sin thetically puts them in a call position in this way it if it catches a bounce they'll get upside exposure but mitigating the downside risk if it sees further weakness. >> further weakness. wow, down about a third in the past three months. guy. >> i'm looking at the quarter in september 4th, the quarter was i guess okay but their guidance lousy valuation is ridiculous. morgan stanley i think they rolled the price target from 38 to 28.

probably still too high. i just don't see any compelling reason to go racing into slack at this level. it makes no sense to me at these price levels you haven't seen the flush yet. >> i know what you're going to say. microsoft. >> microsoft owns them they already took them -- eyebrow i'll tell you the other side it's like uber great company but can't make money if they candidate make money that's a problem. >> thanks, mike. more "options action" check out pu show friday 5:30 p.m. eastern time up next, final trades. ♪ >> announcer: "options action" sponsored by think or swim by td ameritrade ♪♪ ♪♪ ♪♪

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quick program note be sure to catch wilfred frost's skruf with goldman sachs chairman and ceo david solomon tomorrow 3:00 p.m. eastern time time for the final trade now. pete narjen. >> i got to tell you options were beserk and slumber jay. i was in it out of now back in it again tink it's goes higher >> chairwoman. >> united ramen rental reported earnings process people slightly disappoint the i'm long if it trades down i'll buy more tomorrow. >> steve. >> spirit airlines same way in rocco. i'm not confident in spirit but

still in the name. >> can you believe the gnats swept the cards. >> it was unreal. >> 'twas. >> but it made me think about cardinal health with which we talked about last night. maybe it's a zero-sum. one rousey one good. into earnings. >> that's do it for us see you tom at at a 5:00 with more fast. "mad money" with jim cramer starts now there's always a bull market somewhere and i promise to help you find it. >> hey, i'm cramer welcome to cram-america, my job is to educate and teach you. call me, at 1-800-743-cnbc, if you remember the charlie the tuna, the fish with good taste

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