discussions. no movement in the right direction, but it seems like everyone wants stimulus, the people, the market, president trump, vice president trump. >> and yet we are up 3% on the s&p. thanks for watching. >> tonight on "fast money" a big call on big oil. plus, the mouse that roared. big battles between disney and the state of california. and find out if you should add any to your list

skyrocketing a heart thumping 50% it's not all rainbows and butterflies. ibm was caught in a bad romance. the separation sending shares up 6% today more on the big blue breakout. >> ibm has seen a little love from investors over the past decade so it is splitting itself in two and saying it will list its it services as a separate company next year. investors initially cheering that move sending shares up about 6% but the ceo reminded inversers

that it i ddivested in the '90s they didn't play into the value. shares have under performed through the broader if he can sectors to broader names like or cal. but two years ago ibm was about watson and tech. it is said watson is barely mentioned on earning calls ibm was late to the game and still far behind amazon and google back to you. >> let's trade this. question, guy. i will start with you. >> when you start with a question, it always confuses me. >> does this spinoff actually

further ibm's turn around plan or is this just financial engineering? >> the latter. hello, melissa i think it's the latter. if ibm was clever, they would rename the company red hat 2 because that's what it is if you want to boil it down i think it puts a fine point on what it is trying to accomplish. there was a time on valuation. they had visibility and a recurring revenue stream that gave them a multiple better than the market they are trying to get back to that in terms of the stock, in my opinion, i think you have been handed a gift. you have been traded up to and closed at a level we topped at on june 5th. to quote the steve miller band, i would take the money and run on ibm >> karen, what is is your

thoughts this is a company known for financial engineer guy outlined the number of businesses they have divested over the year much is this part of a true evolution of its business or just making the business look better [ no audio >> i think we are having problems with karen's mike we will work on that i will pose the same question to you. >> on face value it is financial engineering. that fits the bill of the definition of what it is with that said, it is a matter of whether they can deliver.

i can see value in focusing down on cloud computing if we look at some of the other companies, crowd strike, we could go ad nauseam about these other countries, focusing on that and ai, it is a testament to a strategic shift i am hesitant from bashing a company for taking on a pivot and taking on a bold move. to me it's an attempt to form a more creative company. >> so the question is, do you buy into this evolution? >> i guess we are going with steve miller tonight i don't think this stock will be "flowing li

"flying like an eagle. i think the guys have framed the debate pretty well it will be spinning after global technology services. it has been a core business for them it hasn't grown but there has been residual core value you have to be careful i do think the focus on the cloud, you heard from the management, they announced guidance if you are talking about single, mid digits is roughly the growth -- that would really be a level where this stock has broken out of this range. we have traded in this range and if you look at the five-year downward slope, i think ultimately we need to break decidedly out of that range.

i don't think this news alone does that. >> cloud computing is all of the rage so ibm, should you afford it, the benefit of the doubt and think it should be rerated or that we might be entering a chapter where ibm shares are rerated because of the new focus it has got >> there is limited upside we are not talking about a new growth company seeing 50, 60, 100% a year revenue growth but this company has struggled to grow even marginally over the last four or five years. i think they have been slhrinkig a percent or two but if there were more robust margins, i could see upside in

this stock >> here is another question for you. >> two questions in the first six minutes of the show. >> that's my questions ibm, is it more like h hewlett-packard or microsoft >> that's a fantastic question that's the framework we have talked about ibm over the last four or five years both microsoft and ib wrrch wm e doing the same thing microsoft pivoted, ibm is late to the dance i think ibm is more hewlett-packard. it pains me to say that. i think i was born the year they were borne >> it's a 109-year-old company

great to have you with us. is ibm more like hewlett-packard or microsoft with its announcement today >> i would probably agree with guy on this. when you think about what ibm is doing, they are playing significant catch-up they are honing in on the cloud market to do so, they need to divest a legacy business that has been declining 5 or 6% a year with that die vest tour, they are keeping some of the cloud assets it will probably decline faster than that. i think there are questions in terms of what it looks like. there weren't a lot of answers on the phone call this morning

a lot of questions on structure. it seems clear the focus is to play catch-up to circuit providers like amazon and google when you think about the $36 billion acquisition of red hat, how to combined that with this >> all of those who have been in this game so long who have market share >> it will take a long time. look at google it has taken a long time to catch up to microsoft and amazon i think it will take time and patience the growth strategy they outlined today they talked about mid single digit growth this company has been growing 0 to 5% over the last several years. it will take a lot to accelerate

that growth. >> karen, thanks for being on. even if one is skeptical about these two companies and how they trade, shouldn't one have done this anyway even if there is a risk of it not working >> i agree with that from a perspective of ibm, it's a relatively new ceo even though he has been with the company a long period of time. this is looking how to attack the cloud going forward. strategically it makes sense when you think about how the vision looks going forward and how to attack the market microsoft realize they have this massive base from an enterprise perspective and they lnch that -- leverage that it will take a long time

>> obviously ibm is intense in kpaeting wi kpa competing with this business do you expect prices to be across the board >> pricing is part of the equation, but if you are the ceo of a fortune 500 company and you are talking about shifting your infrastructure to the crowd, that's just part of it you want to make sure that those assets are never going down. i don't anticipate that being part of the equation >> good to see you >> tim, top cloud play >> probably google for me. i like the valuation and other parts of their business. i realize people have been talking more about microsoft and amazon, but frankly, i like google's business. i think their core business in

search is proven and their cloud is good. >> let's go to the manager marriage morgan stanley earlier saying this move has been in the works for years. >> they have an incredible custom product in parametrics. large sustainability funds it's an unusual deal and highly complementary. it is something we looked at for several years and took advantage of it. >> what do you make of it, karen? do you think morgan stanley is more attractive as a business today versus yesterday >> i think it's interesting. i was surprised. i know the stock was up a lot. it didn't seem like they were paying that much for assets.

it seemed like there was a lot of synergy here. now it sets up a land grab remember when schwab bought ameritrade good timing for nelson >> are they going deeper into a business slowly being eaten away by a business with robo advisers guy? >> i think that is true. but if you listen to what james gorman has said over the years -- -- quite frankly, he can tell the board, you need me to integrate this deal. i think karen is right, there will be a land grab. morgan stanley was first to the dance. i don't know you buy morgan

stanley, but you look at some of these asset managers and you look at who is next. >> and they play it as which one is next. at this point in time would you buy a morgan stanley kind of business or morggoldman sachs kd of business? >> i would go with goldman sachs because of their investment strategy morgan stanley, you have seen a limited assault on some of the fee generation businesses there. so when you look back at bank earnings in the last two quarters and talk about training profitability, i think goldman sachs is better and that would be my preference for a business transitions into retail focus.

>> tim >> i think this is a good move you want to own morgan over goldman. it has outperformed goldman sachs 15% on a two-year chart. it takes away regulatory pressure, takes away the balance sheet requirements this is around 4 1/2 trillion dollars of assets. it's massive i think they deserve a premium over others. >> karen, do you think there is another deal in the works when it comes to as set managers? >> yes i think we will see one. invesco, you are already under scrutiny there this adds to it. i don't know who it will be, but i do not think this will be the first and only one we see. >> come on, let's play

matchmaker guys, play this game with me >> do you want me to sing? >> not really. you can't unhear things. >> you brought it up i don't think citi will do anything they have their own problems goldman sachs is trying to get away from the way they were 15 or 20 years ago when i was there. i think wells fargo has too many issues so you have to ask yourself who is the next bank to step up. it comes down to goldman sachs or bank of america i have no idea who they pick >> i think maybe they are looking at etf companies i think that's a major investment trend think of some of the big etf companies that are still independent. >> we are not done

two big names called for in oil mega mergers and disney in california is throwing down the gauntlet when we return. my father always reminded me, "a good education takes you many different horizons" and that sticked to my mind. so, when $1 a day came out, i said, "why not"? why not just utilize that resource. and walmart made that path open for me. without the $1 a day program, i definitely don't think i'd be in school right now. each week for me in school is just an accomplishment. i feel proud every step of the way.

♪ you can go your own way is just♪ go your own way .

your wireless. your rules. only xfinity mobile lets you choose shared data, unlimited or a mix of each. and switch anytime so you only pay for the data you need. switch and save up to $400 a year on your wireless bill. with the carrier rated #1 in customer satisfaction. call, click, or visit your local xfinity store today. welcome back

disney slamming california again over the state's refusal to allow it to reopen its theme parks. melissa? >> disney is criticizing california's refusal to allow it to reopen. disneyland issued a statement today saying -- now this follows governor gavin newsom saying that disney's parks won't open until covid cases stabilize and improve. while the county adjacent to the

disneyland reports its biggest spike in cases in six weeks. the task force had its head row sign no comment from disney on that i want to note here, that disney world in florida has been open with limited capacity for a couple of months >> julia, this drag is hurting shares of disney what do you make of disney's fight with the state >> i think disney has to play this game on some level. we have the numbers in florida to compare what they may be missing out on that's reality we have dealt with are they open or not since the beginning of

covid. at times it has been seen as the turnaround or reopening phase was going to be somewhere out there. but more importantly, what we have been arguing in the last couple days is should they be a content machine or the fly wheel of consumer products and streaming. i don't think they should be a streaming machine. netflix isn't profitable disney's numbers spiked on the quarter because they could tighten their belt >> let's say there are those two choices, content machine or fly wheel machine. >> you have this auxiliary

business that can become part of the streaming business pivoting away from that changes the underlying brand there and brand recognition. >> how does the balance sheet look like, karen they have a lot of debt, a lot of businesses virtually shut down because of the pandemic >> i think it's concerning i think this rhetoric back and forth is setting them up to announce a terrible quarter. maybe that's already priced in when we talked about this yesterday about should they be a content machine. i think they shouldn't with guys talking about espn, if it were spun off and able to be in the gambling business, that could create value for share olders maybe it wouldn't be part of disney

shareholders should be paid a dividend they weren't paid in the first quarter. they are leveraged, but they have cash, even if they need to borrow it. >> what would you tell him to do >> he is a huge fan. i would have told him. when the fox acquisition came around, i believe they had an 11% stake in draft kings i would have tried to match it with espn, a match made in heaven, spun that off, an incredible dole incredible deal in my opinion and off we go. i am not the ceo of disney so i can't tell him anything. but what i will say is go back

to the spring of 2019. the stock couldn't get through 120 on the upside. traded down to 120 that's the line in the sand. >> here is what is coming up next #. >> the energy sector may be bruised and batter, but our next guest has an idea that could really fuel the space. will a blue wave in november mean more grfoeen r this sector? we will get answers to that and more when "fast money" returns my financial professional explained to me all the ways nationwide can help protect financial futures in peytonville. nationwide can help the greens get lifetime income because their son kyle is moving back home and could help set up a financial plan for mrs. garcia. and he explained how nationwide can help mr. paisley

and their new band. exactly! yeah. don't forget the band. i haven't. we're committed to making college more accessibley, by making it more affordable,

that's why we're keeping our tuition the same through the year 2021. - i knew snhu was the place for me when i saw how affordable it was. i ran to my husband with my computer and i said, "look, we can do this." - [narrator] take advantage of some of the lowest online tuition rates in the nation. find your degree at snhu.edu.

welcome back to "fast money. oh, how the valuable has fallen. chevron overtook its capitalization but it was short exxon regained its top spot. and it is said that these two oil titans should merge. talk about a mega deal what would a combined company look like? well, they are about $130 billion each in market cap exxon formerly was about four times the size of chevron. when i say recently, as early as this year, january of this year.

exxon was double the size of chevron. it would be a very big u.s. oil company, but it would also be one with a tremendous amount of balance sheet power. one thing weigh like about the idea, if chevron took control, you could get better on the esg and get rid of a public relations problem where it is perceived to be for better or worse, but rightly or wrongly. exxon has a huge public relations challenge. one solution might be to end exxon. >> would the ceo of chevron do this >> i doubt it. i think if this continues for another year or two or gets more in favor of chevron which is heavily praefrd eferred by the , then it's a possibility. as of now going into the

election, i think there is zero chance of this happening but the point this morning was this is where we have gotten to with the crisis. chevron is bigger. the next era is bigger than both of them. the writing is on the wall for the next 50 years. these are 100-year companies this is very big and this is a big idea >> paul, restructuring rumored around exxon, whether this is happening and in what way. is there anything on stock that could make this good for investors? >> in the short-term they are cutting costs as much as they can. over $100 billion in administrative costs in exxon which is a huge company. we think they should cut caps further. a year ago they were at $40

billion a year they are talking about going down to $20 billion. we would like to see them go to $15 billion. are they going to pay this enormous burden? the market doesn't believe them. at least the market doesn't believe it is sustainable. if you could sustain it, potentially it is super attractive if they can make it, but at the moment, the oil market is against them >> how does that change under a baden administration for oil >> it's going to be very significant because you were going to be pumping money one way or another in the renewable sector where my clients are making money is in the renewable sector a lot of these renewables have small market caps. the amount of money proposed to

going into the general theme of being more carbon friendly, this is beyond anything we have seen up to now. it should be positive there. if you are going to limit methane emissions and stop drilling on federal lands, that will reduce federal supply and people will still be driving gasoline powered cars and still taking planes around which will leave oil up in doing so, you should have a disconnect between high-low demand disconnect which we think will be bullish over the next five years >> chevron or exxon, you like it >> i think chevron is the better

company. 120,000 employees. obviously huge job loss. i don't think it gets through the proper legal channels, regulatory channels to approve the deal, but what do i know if terms of the stocks, chevron i think is the better company. exxon might set up better. they just traded down. levels we saw in march bounced off the $30 level. i think for the first time in a long time exxon might be interesting. >> i thought it was interesting that paul was outlining that under a paul biden administration, renewables and oil goes up. do you buy into that thesis? >> i can see the restrictions here, but it makes me think that saudi arabia will see this is

maybe our last chance -- we are nearing the end of fossil fuels so we should pump like there is no tomorrow. so i think there would be a disconnect >> coming up, who says retail is dead take a look at all of these consumer names hitting multiyear highs. shop it or drop it is coming your way later, iphone calls, how traders are setting up for next week's big apple event. how we come up with new ways to serve our customers... and deliver our products. but no matter how things change, one thing never will... you can rely on the people and the network of at&t... to help keep your business connected.

beautiful. but when i started cobra kai, the lack of control over my business made me a little intense. but now i practice a different philosophy. quickbooks helps me get paid, manage cash flow, and run payroll. and now i'm back on top... with koala kai. hey! more mercy. save over 30 hours a month with intuit quickbooks. the easy way to a happier business. try nature's bounty hair, skin and nails gummies. the number one brand to support beautiful hair, glowing skin, and healthy nails. and try advanced, now with two times more biotin.

welcome back in case you are not aware, it's just 78 days until christmas yes, we are playing christmas music. and some retailers have merchandise on display trees and more all of these retailers hitting highs. we thought it would be a perfect time for shop it or drop it!

shop it or drop it >> i would drop it those numbers were so great. 16.7 those are fantastic numbers. i wonder are they pulling forward, and if those numbers were that good and the stock only reacted like this, imagine if they don't beat it by a lot >> what did you say? >> i hate to disagree with karen. maybe i should recheck my numbers, but i'm shopping it when i look at what's going on the move from urban to suburban areas, i think that bodes well for costco the per ticket purchase item or aggregate amount spent for each item is continuing to increase they continue to have robust

free cash flow, debt around $10 million or so. it is in a strong financial situation. cash on hand of $13 billion and debt of around $10 million >>e >>est >> estee lauder. shop it or drop it >> i am all about beauty i'm shopping it. the china strength demand story, it's back in asia. the trends here are strong the valuation are not terribly attractive if you look at the margins, that's what is giving the stocks the ability.

>> in the past many years i have thought it's all about beauty. it comes to mind what do you make of estee lauder >> when you have those steely eyes like he has, of course it's all about beauties i don't understand the rules in sports when you shop a player, you are looking to get rid of a player so you are looking to purge but i would drop it like it's hot. take this into consideration goldman sachs had a sell rating on this at the end of september. they upgraded it to neutral. they finally caught up i understand the china growth, but they better sell a lot of eyeliner because to grow into that valuation, it will take a lot. >> i am surprised you didn't say anything about the christmas music at the top of the segment and the countdown to christmas >> no, because --

>> the countdown to christmas? >> as much as you are in my head, i am in your head and i knew that you knew that i was going to say something about that so i decided not to because it's not the holiday season unless your holiday is halloween. >> there is always a holiday even though it supposedly doesn't tweak you, we are still going to do it shares at its highest level since may of last year do you shop it or drop it? >> drop it or purge it as guy would say. i told you what i feel about retail and the in person shopping experience. these people have been a lag gat in terms of moving to the

platform >> i would shop them that has been the story of gap so far what is going on in malls has forced them to close stores and become leaner. guy spends a lot of money so i think there is something to shop for at the gap >> how do you know he knows what they are >> yeah, i wear my easies, to bed. >> last but not least, with 78 days to christmas, dollar general hit an all time high shop it or drop it >> guy, you have been the host of the show for over 11 years and you know for a fact this is a name we have talked about in earnest for the last couple

years. it has had a huge run. valuations might be stretched, but i am still shopping there and still shopping it. coming up, stocks blazing high after last night's vice presidential debate. the four words that got the group fired up and unveiling of the next iphone

♪ ♪ ♪ ♪

in case you missed last night's vice presidential debate, this is what lit a fire. >> we will decriminalize marijuana and expunge the records of those who were charged with marijuana tim? >> it's a complex issue. i don't think investors need to be that focused on it. federal legalization is option alt. more important is that you get

arizona and new jersey who are going to come online for adult markets. these will be massive markets. the most important thing for can busine cannibis investors, where else would you get this kind of growth the profitability is there the states and the addressable market, states rights have allowed this industry to grow despite the difficulty in banking and accounting and no capital market the stocks are bullish and you are seeing that in the last couple days as you see stocks trying to price in on a blue wave or not. these stocks are all moving 25%

over the last 25 days. >> i thought the argument had always been that these guys belt their beefdom within each state and had amassed licenses, but if you have a federal level, it paves the way for a walmart of cannibis >> the states may control the licenses many of these states are forcing vertical integration the biggest thing the federal government could do is allowing for banking investment for large banks. i don't think the industry is fearful for lateral even though this is one of the largest consumer products of a

generation they will be here but that's not what the companies are worried about. >> up next, we will bring you action at the top of the hour. a company failing to deler oivn earnings catch that interview don't go anywhere. much more straight ahead grandparents! we want to put money aside for them, so...change in plans. alright, let's see what we can adjust. ♪ we'd be closer to the twins. change in plans. okay. mom, are you painting again? you could sell these. lemme guess, change in plans? at fidelity, a change in plans is always part of the plan. keeping your oysters growing? while keeping your business growing has you swamped. (♪ ) you need to hire i need indeed

indeed you do. the moment you sponsor a job on indeed you get a shortlist of quality candidates from a resume data base so you can start hiring right away. claim your seventy-five-dollar credit when you post your first job at indeed.com/promo

♪ you can go your own way ♪ go your own way your wireless. your rules. only xfinity mobile lets you choose shared data, unlimited or a mix of each. and switch anytime so you only pay for the data you need. switch and save up to $400 a year on your wireless bill. with the carrier rated #1 in customer satisfaction. call, click, or visit your local xfinity store today.

welcome back apple is expected to unveil its next generation of iphones you have the action, take it away >> leading into next week we are seeing calls outpace three to one. the money straddle expiring next week a 5% move in either direction between now and next friday. the trade that struck out to me was about 40,000 at the money calls traded about 3:15. a block of these look sold, but the nuance is that somebody was gladly willing to take those down you are risking about 2.5%

keep in mind the stock has moved about 2.5% over the last 20 days of trading i like trading from the long position >> how do you feel about this event? the stock in september was down a little more than 8% or so. but they had a huge run-up prior. was that run-up the anticipation in terms of the 5g phone >> it was also the market and d dynamic of the fed and alternative of the stock it was all of those things together i am long. i am a little concerned about the valuation here i would be looking to sell calls either into this event or earnings which i think are at the end of the month and take a little bit of money off the

table. >> does this sell the news, guy? >> i believe so. i will let tim answer. i thought about what the game should be, mel -- shop it or drop it -- which makes no sense. this is the holiday version. you are going to love this elf it or shelf it >> what does elfing something mean that is meaningless. elf is a noun, not a verb. >> okay, fine. that's why i'm fun and sometimes you aren't elf it or shelf it you will use it next time and think of me. >> do you have a comment on apple? >> tim does. >> elfing, hopefully that is not in the urban dictionary. if you look at the chart, you have an opportunity to see pullback to the 95 area. i think the valuation is tough

i think in the current environment there is enough for the stock. i think 25 times forward where it has come back to is a level it will settle into. to me it's almost i am pore fmpo them to deliver on the upside of f me,phone release. >>oror tune into the full show tomorrow. up next, final trade i'm searching for info on options trading, and look, it feels like i'm just wasting time. that's why td ameritrade designed a first-of-its-kind, personalized education center. oh. their award-winning content is tailored to fit your investing goals and interests. and it learns with you, so as you become smarter, so do its recommendations. so it's like my streaming service. well except now you're binge learning. see how you can become a smarter investor with a personalized education from td ameritrade. visit tdameritrade.com/learn ♪

by my health insurance. and this is the aflac duck who helped me cover it. aflac. these are all the cab rides to my physical therapy. and aflac paid me directly to help. aflac. what he said. and this unexpected bill is from... the two-thousand-dollar specialist. thanks. aflac. when you're sick or injured, aflac is there. we can help with expenses health insurance doesn't cover. get to know us at (aflac!) dot com. ♪ ♪ "hmm's and ahh's" heard in-call. ♪

♪ "hmm's and ahh's" heard in-call. for skin as alive as you are... don't settle for silver ♪ gold bond champion your skin - we did it!c) (crowd cheering) - [narrator] wherever you start, snhu is where you can finish. (crowd clapping) (crowd cheering) - here we go. - [narrator] and it's it. - [group] yay! - [narrator] you did it, high five! - southern new hampshire university. - [man] that gets a hug. (laughing) - look at that! master's degree, i did it! - i did this for my children. i am very proud of myself. - [narrator] finish your degree at snhu.edu.

time for the final trade let's go around the horn tim? >> morgan stanley deal today i think does continue a multiple expansion and upgrades the credit of the company. i like this deal >> karen >> go long, buying it on the close. i bought on the long target. it deserves the multiple it has gotten >> if you look on the long side and you don't have tim seymour on speed dial to break it down

to you, look to c.j. buy. >> have you seen the downgrade thc is breaking my mission is simple, to make you money i'm here to level the playing field for all investors. there's always a bull market somewhere and i promise to help you find it. "mad money" starts now hey, i'm cramer. welcome to "mad money. to cramerica to educate and teach you call me at 1-800-743-cnbc or tweet me