tv Fast Money CNBC October 6, 2021 5:00pm-6:00pm EDT
annual meetings are typically pro forma affairs unless the ceo decides to make it interesting i don't expect anything out of the realm that was expected. >> oil did close lower today by 2.5% we are out of time "fast money" starts now. >> live from the nasdaq market overlooking times square, we are live we will be joined in a few minutes. red alert in energy. natural energy prices going wild key names to trade and tim says this is the one stock that should have every investor concerned later,ie lon musk, a dog and a
cripple. we will explain. let's go straight to phil lebeau who has all of the headlines from investor day. >> more clarity from cfo paul jacobson about how general motors plans to double its revenue. trading higher after hours a couple things to keep in mind. they plan to double their annual revenue by 2030. they get there by taking 140, annual revenue pre-covid and say we think we can double it. they are targeting margins 12 to 14%. they only expect to be doing $9 billion in a couple years from now. they would plan on services and
subscriptions for people who have an electric vehicle or autonomous service vehicle from the company. they plan to lead the u.s. in ev sales. people are saying can they get there? stocks, no comparison over the last couple years. market share, no comparison, either we asked the numbers be run. in 2021, tesla controlled 63% of the ev sales general motors is number three with 9%. they have a huge hill to climb to catch up with tesla i am told they think they can get there because they will have a broader portfolio and over time that will help them increase their sales and shares of general motors, i want to keep you posted on what happened with paul jacobson.
he is coming right here to our camera we will be talking with him first on cnbc in about 45 minutes. we will ask more detailed questions. no doubt general motors is trying to leverage all of its investments in autonomous and ev vehicles they think they can use those vehicles for subscriptions, whether on a monthly basis or what they will pay for to run through the vehicles >> does general motors have the battery capacity, supply, if you will, to guarantee they can reach these goals? >> they say they will have it. they are building four plants. one in ohio, one in tennessee in 2023 two more announced, but they haven't told us the sites or
when they will come online the real rampup will happen 2025 to 2028. that's when you will see a slew of electric vehicles coming on line for general motors. you will also have these battery plants as well as final assembly plants either they are currently building vehicles like factory zero or they will be retrofitted. as ev sales ramp up, they will convert them, all of them or part of them, into electric vehicle assembly lines >> you said they are three what is number two >> volkswagen. those guys are one, two, three worldwide. one, two, three in the united states but tesla is away head
we said where do you think they will be by 2030. they said they won't have as much market share by 2030, but will still have a strong position by 2030 >> we will look forward to that. the stock didn't move all too much on this news, tim seymour. >> we have heard a lot of this news and when somebody tells me it will happen by the end of the decade and it is the start of the decade, there is a lot to prove. gm made a lot of commitment to autonomous the announcement that their last mile ev services will be $10 billion by the end of the decade is exciting, but a long, long way to go.
the market almost values gm now like their core business, the internal combustion engine has a limited value and at some point will be obsolete gm knows that. in their profession, they will be x by x is great 90 billion from 10 billion -- so from 23 and by the end of the decade 90 billion. tesla is a $772 billion market cap. i pointed out that i think tesla at times may not be based upon valuation. but this is gm's day
as a bull and owner of the stock, great stuff i think they need to put their head down and continue to do this >> the concept of recurring revenue is good even though it is a long ways off but let's say we get to 2030 and they checked all of the boxes, does it deserve a tesla valuation? >> it doesn't need to get a tesla valuation to have it be a good due from here what is the tesla valuation at that time if gm does all of the things that gm says it can do. tesla is not going to have at that 46% better market share than gm at that time if gm can do what it says. i agree with kim gm is a show me story. even when they show me the numbers right now and still
trades at a low multiple the idea we are going to jump on and get excited about 2030 is hard to fathom because even right now when they put up good numbers, i feel like it doesn't get so much respect. i am with tim, bullish, long they have been telegraphing this, but i thought those were good numbers we will see. i think new cars -- i am interested in how the lyric does which is coming out in 2022. >> does your position change much now that gm has put out targets for 2030 could you put out targets for 2030 it's a long ways off is the point. >> i could i will be 97 i am sure i will have a name
tag. the short answer is absolutely not. let's give them the benefit of the down karen mentioned the show-me story. they should move their ev facilities to missouri, the show-me state. i don't know if they are watching, but that's clever. in that period of type you are talking 8.5% growth rate do they deserve a tesla valuation? absolutely not based on that growth what is the right valuation? i would say not where we are now, but close to 10 or 11 times. so given the earnings i think it's a -- >> the tesla valuation is a pixi
dust battery technology and power wall and other uses of the battery technology, not just an auto company what are your thoughts on tesla given the low valuation that gm and ford have? >> interesting point this is the only thing that you can glean from any of this is that when we get there, tesla is at 63% market share now i believe phil said. that market share is going to drop from now till then. that's my take away, whether it's fact or not, that's the way i look at it having said that, i think it's exciting when you look at a company like gm talking about $2 billion in revenue going to $30 million in services. we have seen what they do with
onstar now they will integrate alexa into the car i think they are doing the right thing. are people going to get excited about it now when it's 2030, to tim's point? no but are they making the right moves, absolutely. having said that, ford's chart looks better technically we haven't heard anything about what they will do by 2030 or we haven't focused on it. but the stock is up 60% year-to-date the way you started the question about tesla. it's whack a mole. too many things go into the calculus of how it's valued. do you sell tesla on the fact they won't have 63% of the market share
no, but they will be doing other things they have figured out how to crack the code tesla is only up 10% year-to-date there is something to be said about going out of tesla and going to a battery company and gm role. >> i want to ask the shareholders because we will have the cfo in an interview karen, what would you want to know at this point >> i'm curious whether or not they will reinstate the dividends. they used what i thought was an opportunity to hoard the cash during the pandemic. i am interested in that. i don't know what the right answer is to that. you have a giant cap x spend in front of you $30 billion. maybe don't pay a dividend or a small one. i am curious about the capital
allocation >> tim >> i want to hear about the vertical integration between hardware and software. that has been one of tesla's benefits because they are integrated as opposed to the partial build. what will they have to spend, the timeline and back to margins, 12 to 14%, great. is this linear do we get there quickly? profitability is important do they sacrifice profitability to get there with this cap x >> hopefully we will get answers. the cfo will join us in an interview a little later on in the show coming up next, we are going to talk about a $14 billion
baaam. internet that doesn't miss a beat. that's cute, but my internet streams to my ride. adorable, but does yours block malware? nope. -it crushes it. pshh, mine's so fast, no one can catch me. big whoop! mine gives me a 4k streaming box. -for free! that's because you all have the same internet. xfinity xfi. so powerful, it keeps one-upping itself. can your internet do that? welcome back taking aim at macy
an investor urging them to spin off, to make them double macy's playbook we have seen this before with sach's karen, what do you think >> i think janus is a great investor they have a number of activist investment i don't see them having owned any stock in june. they could have bought positions since then if you do use sach's which has a value about 2.24 times revenue when they did that deal which is not a public deal. i am not sure the split of macy's online versus instore
it is not a crazy multiple i always wonder when you do the e-commerce split how do you allocate a sale that starts in a store where they say we don't have it in the store but we can send it to you. whether it was mon adveetizing. i am surprised the stock didn't react more >> that's a good point so many e-commerce success stories involve multichannel which is that the sale originates online or in store and you can return it any way you want to. >> it sounds alchemy to me at the end i am certain -- if
they are shareholders, to karen's point -- is to make the stock go higher. the stock didn't trade particularly well, maybe because of a number of things. i think macy's can go higher anyway it has been trending higher. tim has been on this for quite sometime i think you stay with the stock before this news and it gives you a bit of a tail wind now >> tim, you own this one would you like to see this >> digital penetration is already going to be 42% in the next year depending who you listen to. the fact they have $42 billion in real estate and have 15%. covid forced them to do and they were doing
this is an interesting story i am not sure you need this type of a catalyst. and then some of the parts karen referred to, we have been down this road before very different balance sheet very different company they understand their inventory. i am not sure they need to do this >> when i look at this, i like tim's point it is a different company and balance sheet. from 2018 to 2020 the stock dropped 56% for all of the reasons that the old company played with. back then we were talking about the real estate, option alt of it, but prepandemic the stock was trading around $16 or $17. i am a believer that whatever was weak prepandemic will be
weak post pandemic that's why you didn't see the stock react to this. i think it's run decently for all things being equal and fair. it will take more than one headline from an activist to get the ducks in a row >> tim, quickly. >> short interest on this is a big part of the move when you see a move like this, you could see people run in. they are still north of 10% interest >> good point. >> we are just getting started key energy stocks you need to watch plus it's time for trade school. a loan professor tim seymour is giving a lesson in the all mighty dollar. we have that and more when "fast money" returns
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welcome back to "fast money. wild swings in the energy market commodity pulling back in a big way following a huge run-up. brian, what is driving this action >> what is not driving the action is probably a better question a wild day for nat gas here, but in europe prices pulled back call it the putin put, talking about adding supply. this is political for him to get the nord stream approved two weeks ago oil closing in on 80 bucks, above that and now the biden administration talking about a ban on crude oil
exports. let us go global nat gas surging to new records in europe. what does that mean? it was about 500% above normal in uk. coal prices, yes, coal, soaring, nearly double in the last few weeks, calling wholesale electricity prices to jump 400 or 500% across much of europe. why is it happening? boom and demand. wind power hasn't been generating they need the electricity somewhere. and uk rely on the spot market asia, china playing 25 or 30 bucks for l and g. normally about 10 to 12. and there is talk of converting
a coal powered plant to oil. that could happen and boost oil demand to 500,000 barrels a day. mass would equal all of opec's supply increase. from a natural gas perspective, eq t eqt, they are up 60 to 100% this year one more thing for guy adame, since natural gas is used by so many companies, look at fertilizermakers, because they may be able to profit. we get the natural gas relatively cheap in europe it's soaring if it spikes chemical fertilizer prices, that's a food inflation thing as well.
that's a lot of stuff i threw out. >> brian, i have a question in terms of -- part of it speaks to underinvestment over the years, natural gas. even if the uk invested in storage, it could take a while for this to iron out >> it certainly could. brexit plays a role as well because uk gets a lot of electricity from france. france is threatening to withhold or cut off electricity supplies to the uk because there is some dispute to fishing rights in the english channel. you can't make this up uk wants to go all green which is great but windmills only generate power if the wind is blowing
the fact there is a race for coal the price of coal has nearly doubled in three weeks the best performing commodity this year is coal, up 170 or 180% it's insane. >> brian, it's always great to see you. we will see you tomorrow morning on worldwide exchange. >> like in two hours >> guy, what do you think? how do you play this energy quagmire that we have got? >> great job by brian. when the fate of europe is in the hands of vladimir putin that's problematic i think we would all agree on that the prices he described, he is not making it up that's what is going on. we have talked about nat gas you brought up phil a couple weeks ago.
some stocks move percentage points per day but southwest energy is interesting. this is real obviously came off today this nat gas story is not over brian said it, it all comes back down to inflationary if you don't think this is inflationary and if you think it will sort it out, it ain't >> i feel like that may be a name you may be in >> i actually am not when you look like antero, ar is the ticker or range resources, those stocks are up 265%, 235% respectively so some of them hedge, some don't. the first one doesn't hedge. range does hedge my point in all of this is it's very difficult to understand the
g granularity. i would say nat gas is dependent on whether we have a colder winter or warmer winter. i would rather be a buyer of large integrated names exxonmobil is up 46% year-to-date this is from switch into value then i don't have to know the g granularity involved in investing in nat gas >> why not coal? this is circa 2009 when we talk about fpeabody. >> gas trade in any market i agree. coal prices are a harbinger for higher prices. this is green-flation.
there are a lot of factors that make it up coming up, a can't-miss interview moments ayaw but first class is in session with professor tim seymour. what it is and how he's trading it when we return. we cut to downtown, your sales rep lisa has to send some files, asap! so basically i can pick the right plan for each employee... yeah i should've just led with that... with at&t business... you can pick the best plan for each employee and only pay for the features they need. you have the best pizza in town and the worst wait times. you need to hire. i need indeed. indeed you do. indeed instant match instantly delivers quality candidates matching your job description. visit indeed.com/hire that building you're trying to sell,
welcome back to "fast money. notice the dollar hitting its highest level in a year. professor seymour, take it away. >> important trade school. for investors, understanding the impact of a stronger dollar is important for the theeory behind it this could be a factor of the feds getting more in gear. but what are the things to think about when you see the dollar strengthening in terms of past history. a stronger dollar can be a sign of risk off because often people are borrowing cheap money everywhere borrowing in dollars and
investing in other asset classes. is it the taylor il or the dog, will see still the global reserve currency so when you see a flight to quality, you see a flight to dollar for other currencies in the world this can have devastating impact finally, the stronger dollar can be a function of central back differentials. strong or not, it is still our fed. other banks may be the problem typically they are following behind the fed the sign of the dollar moving higher may be a sign that our central bank is moving faster than other central banks what does this do to the market? first of all, we talked about
the impact on other currencies and other interest rate dynamics think about other parts of the world, especially emerging markets. rising dollars is a wrecking ball for currencies. that could have led to some type of a shock which leads to a credit event, which leads to other dominos falling. if you think about the dynamic of commodities and where oil prices are holding up well for other dynamics, but commodities are priced in dollars tend to underperform when the dollar is rising so that's something to think about. if you are looking at multinationals, while sometimes it's great we have a strong currency and talk about the percentage of multinationals and s&p that have exposure, if the dollar is too strong, it makes
goods more expensive and less competitive in other parts of the world. something that equities price in a couple of charts the shorter chart, look where the dollar was going into covid. we were closer to a 98 handle. it crosses with the euro, the pound, the yen the dollar could be moving higher some of that is implying the fed will be taking liquidity out of the market if you look at the ten-year chart, go back to 2014 and look at the huge dollar rally which was painful. that was a sign the fed was moving more aggressively we may be getting that again >> guy, we are just coming off a segment about rising commodity, what is the best performing commodity of the year, coal, nat
gas, and yet we have strengthening dollar can you walk me through that >> much different story. a weaker dollarwill be a tremendous tail wind for the things we mentioned and a stronger dollar is a bit of a headwind but ain't stopping it these are two different stories in my opinion. president trump, say what you want about him, but he correctly pointed out that's the last thing we want in this country. a strong dollar is great for you and our buying power as citizens, but it's miserable if you are 30 trillion in the hole. so if the dollar goes higher, the effects could be -- i don't want to use the word catastroicbuph, t it could be scary stuff. >> paul jacobson, his big interview is up after this break. don't like surprises? [ watch vibrates ]
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money. let's get back to phil lebeau. >> let's bring in paul jacobson, cfo of general motors. after questions from analysts, the big question is you are going to double your revenue by the end of this decade how do you get there and should people buy into the idea you can get there? >> great to be here. thanks for being here. an exciting time for us. i think you heard that excitement coming from the senior leaders this is a very different time in the auto industry. what opportunities are going to do is lay the groundwork for us while expanding our margins through 2030 we will do that by continuing to offer the high quality vehicles. and also, the most important part of this is the new
connected vehicle environment. when you look at the software capabilities, the sheer volume general motors are able to put out with our brands and platform, it speaks to a huge revenue opportunity beyond the purchase of the vehicle that is new to us. when you look at that with 20 to 25 billion opportunities as well as 50 billion opportunities from crew as we outlined. you start to see a recipe where we have confidence in our ability to take it to another level. >> it sounds great on paper. the stock didn't move much during the presentation. one thing i heard back is there are a lot of ifs if autonomous vehicle technology takes off. if crews can expand as quickly as they are talking.
you have to admit there are a lot of ifs in there. >> that's absolutely right but we wanted to convey a very different mentality. this is a growth mentality, startup men stalt we are incubating so we have given data surveys what the product is, the cumulative effect of their purchase >> in fact, you said you think people, on average will spent $135 per month on average for sun prescr subscriptions for their vehicle. >> that's what they are telling us they knew at the end of the day what the effects were. that shows the compelling value in software. autonomous, this is sooner than most people think. most people think this is far
off. but what you heard from dan and the team and what we will show to some investors here in person, this is very real and here and we see the scale of this thing as inevitable there are a lot of things along the journey. as we look at the transformation under way, that mentality is what we want people to leave with here today. >> let's talk about the reality right now. karen finerman brought up a good point. what about the dividend? does gm say we reinstate where it was or that dividend won't go back to what we thought it would be >> we are continuing to assess that within the mentality of how we are thinking about the business because we want to be sure we have the capital we established that clearly as the number one, the ability to invest capital we are hearing from shareholders and respect the need to maintain
some level of dividend we want a little less volatility in what we see mary indicated in our webcast, we are still seeing week to week volatility sometimes it's good and sometimes bad. we feel confident we are going to continue to look at that and announce the dividend at the right time >> mary said we are looking at a variety of options what are some of those on the table? >> we as well as many others are looking at things. you look all of the way from long-term purchase commitments that's historically something the industry shied away from we know we need these and know manufacturers are facing their own pressures in terms of their customers and ability to produce. approaching partnerships in a
new way. working engineering to be able to modify and combine chips where possible a lot of strategic things. but engineering, supply chain, manufacturing, all pulling together in a special way which is fun for me to see as a newcomer to our team, finding the best for our customers and shareholders >> you think you can get there by 2030? >> i think we can get there. >> thank you for joining us. good of him to come over after their session. you heard it from him, melissa >> phil, thanks and thanks for asking the questions we had on the panel. karen, do you feel like you got an answer? >> sort of i think they will reinstate a small dividend at some point
i think that's the right answer. i am not in for the dividend if they have this giant plan, execute. >> they have to have some sort of dividend to orient funds which you don't want to be pulled out of. in terms of the chip shortage, interesting they are looking at longer term commitments. if they want to hit those commitments in 2030, as a shareholder, i am sure you would be glad if they could secure some of what they need for the targets. >> they are laser focused on their targets. why not enter into those contracts. i am happy here. tesla has been extraordinary at vertical integration in some of their hardware and software. i don't want to hear that gm is creating these businesses wholesale. locking into long-term
commitments and being able to push around the supply chain because they are that big and important is good news coming up, a trade spotted in the options market. we are back right after this ♪ ♪ >> missed a moment of fast catch us any time on the go. catch the "fast money" pod cast. ♪ ♪ ♪ ♪ i promise - as an independent advisor - to put the financial well-being of you and your family first. i promise to serve, not sell. i promise our relationship will be one of partnership and trust. i am a fiduciary, not just some of the time, but all of the time.
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welcome back topping the market today and if you are not signed up for cramer, you are missing out. jim is giving you a front row seat to what stocks are trading. he will tell you all about his winners and losers you can sign up at the mailing list or point your phone at the qr on the screen from chips to banks. tony joins us who break down action tony >> we saw a massive trade here in financials for xlf, the
sector that tracks the financial sector we traded fairly fast, about 1.4 times the average daily volume the puts were purchased for 89 cents. they were about 5.5% out of the money. we can't say if this was a bet on the banks or protection on the long equity portfolio. the fact this trader went out and paid over $6 million outright is perhaps a concern on interest rates but what they paid on the puts reflects a quarter of a billion dollar position if this was a
protection play. how do you feel about financial earnings >> this is broken out. if you look where it is on a long-term chart it is overextended but for obvious reasons. i thought it was protection, but when you hear the way tony finished up, not too many people have that on their books i think financials have run aggressively, but i do think they have further run if i wanted to tie it up. >> for more options aconti, tune in for the full show on friday at 5:30. ♪ ♪ ♪ ♪
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dogs and named it. but karen, there has been a run in bitcoin and some that you guys on the panel might actually traffic in >> it has been a slow steady run, not even that long. it was interesting to me i thought let's see how robin hood and coin base have done versus bitcoin because we made so much of robin hood from crypto trading, and coin base. to my surprise bitcoin far out pays either of them. the last time bitcoin was at 55,000 i think coin base had a 300 handle briefly i am surprised it has lagged as much as it has both of them >> do you think the coin is the ship coin? only one coin dog can exist in
the crypto universe? >> that's a dangerous conversation i have a dog that is a shih tzu. i would have a field day with that coin. i think the shiba inu won best in westminster some years ago. i can talk dog breeds, but crypto currency is not one >> time to go around the horn. >> macy can be a trade and investment it pulled back i think it was a tactical trade on some of the head winds but i think the longer term, fundamentally, you could own this one >> steve >> around $18, a trimmed a bit but still in it is trading down on worried
out of vietnam they don't have any of those worries so this is a buyers' gift >> karen >> i think coin base is interesting for a trade. not a long-term investment, but just a trade on the heels of the bitcoi starts right now 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. welcome to cramerica other people like to make friends, i want to make money. my job is not to just entertain you but to educate and teach you. call me at 1-800-743-cnbc or tweet me @jimcramer. you know i haven't been a fan of