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tv   Fast Money  CNBC  August 18, 2022 5:00pm-6:00pm EDT

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that than con ed and waste management and north rup grumman. and we have a marked that pulled even s&p 500 barely in the positive zone. up about a.75%. and finishing on 2000 level way as ceiling. that does it for overtime. fast money begins right now. right now on fast money, sea change for streaming. milestone reached for the new generation of media watching and what it means for the legacy players. and rise and risks of single stock. he tf. why the leverage way to plate most volatile stocks is gaining popularity. and are they a better bet than mean stocks. and a cole crash and stocks making moves and we are watching the trades. i am alyssa leave and this is fast money in the heart of
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times square. we start off with streaming surge in to tv spurreysity. medium surpassing cable in july in terms of total minutes watched according to neilsen. streaming 23% year on year increase and cable viewership shrank 9% and mainly players in the space are take notice. the ncaa, big ten athletic conference signed a $7 billion deal with fox, cbs and nbc including eight college football games and dozens of college games exclusively on nbc peacock streaming service. the script is flipped officially. who are the winners? guy? >> hi, it's the two of us here. >> just the two of news no, i see steve and karen and i see the nasdaq and the crew. >> here on the desk. >> that's correct. just the two of us. >> it's intimate as they say. it would be great to have tom rogers to talk about that, but i will start the conversation
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going. it's fascinating that netflix, which trades 22 times next year's number, a number i don't think anyone thought we would see, is not universally disliked bark lot of skeptics, but when it was trading at 60 times, everybody loved it. the last $40 or so caught me by surprise. i will submit this as well. disney you mentioned the sports aspect. disney, espn got the life line when sports gambling was legalized i said it then and now disy is trading from a position of strength what they can do with espn if they choose to. i would submit disney is. >> cheap. >> i mean it's interesting to see that streaming is winning, but there are more streaming players. so, one could argue that piece of the pie is actually divided by many, many, many, many more people. tim, so how do you impunity this on a value of disney or netflix or other streamers out there? >> which i also own and wildly
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competitive and some point you know, there's different ways the community is evaluating the stocks. some are doing it on a sales functional and corps core streaming business when you consider their core business. just back to netflix, i mean, in this secular trend we have been talking about for long time, the death of linear tv, netflix is the first and remain the first. it at 7.7% of all streaming hours viewed of this new record for stream. so, one of the things i mis mentioned on the day when mayormount mayor partymount announced is the streaming companies have been ambushed by the market, the competitive landscape is so much so, there's not going to be rationallation in price. think we are going to get back to a place,er with when content was trading at massive people are up. but at some point, and we can talk to tom about this, the
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dynamics of hulu and disney and comcast and what's the proper bundle and where are we? but to me, i think there's opportunity. >> we are seeing price i creases which implosion consumers are willing to pay up for treaming service. and you think streaming services would have to keep price low or cut them. but they are not. which is a little surprising to me at least. >> one thing is interesting that a lot of this streaming players are also legacy players. right? so they are kind of eating their own. and so you have paramount plus, which actually is cbs go so that's cbs. you have disney, which is abc, and you have peacock which is nbc. so, they are kind of, you know i doesn't know which -- i don't know which effect is happening nor quickly to the bottom line. whether it's the declining legacy business, or the growing streaming world. the costs are dumped on -- i am
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not sure. so, at the end of the day, half the winners are the losers, which i guess leaves netflix the best of the bunch, i think. >> maybe a paramount plus. >> if you think streaming great and legacy tv is dying, the two things coexist at many of the companies. >> yes, so let's start off with war guy started. netflix when you look at it, it did shock lot of people. it was trading way below the pandemic low. so could you make the case it should have been trading below the slide from the pandemic, but it shouldn't have been trading below the pandemic low. but after the recent run, we run into resistance. $250 is resistant to the name. that number comes from the slide that it took in that gap
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on earnings. you wouldn't want to be a buyer of netflix right now. it had a great run off that bottom, but you wouldn't be a buyer. but no one mentioned this and maybe for good reasons, because the stock can't get out of its own way. if streaming is up, then shouldn't roku eventually recover? the chart doesn't look great. but, most charts that are bottoming or have bottomed don't look great either. roku looks to me like it's very close to that bottoming area. >> so you like roku here? >> yeah i mean, just based on how we open the show, if you like streaming, i own it is any so i would be there because it has a bunch levers but roku when you look at the chart and the way you opened the show, should be bottoming if that's the way the environment is going for streaming grind stand what steve is saying. but look over the last couple
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weeks, it was moffett nathanson downgraded the stock two days before. but so the problem with roku chart not with standing, the problems is money and in terms of valuation despite the fact is obliterated you are talking a stock that's too expensive. >> if we play the game. >> i love gapes. >> i tell you about the company, and you tell me if it's defensive or not. i open the game to not just guy. a service everybody wants that increasingly spending more time on, they are willing to pay higher prices, even in this inflation area environment is that a defensive stock, guy? what do you say. >> in this environment, that's defensive stock. >> that's defensive stock. >> yes. >> that's netflix. >> i agree and netflix you can make a compelling argument on valuation. depensive and the valuation is
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compelling. but there are other stocks the valuation doesn't makes sense and roku may follow under that. i doesn't know if i played the game right. >> that's right. karen, what to you think?. >> i am going to go with guy. it's not in a vacuum and it's a question of prize. i don't own netflix it would lead me towards netflix although my book would say go with paramount. as i do think that there is a possibility for consolidation, i don't think netflix is a possible consolidateor or consolidatee where paramount plus could be. >> all the streaming services are pursuing the ad supported model when they are having a tough go of it for ads. so, how does that sort of play into the scenario where consumers are spending more time streaming, but they may end up paying less and these guys may have to shift towards an advertising you know, heavy
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advertising dependent model. >> that worries me about netflix on some level. as they assess other ways, and they start talking about price point for ad supported model i hear $8 and $9. and the issue around the streaming companies is the competitive landscape that makes us question pricing power. we thought netflix had the pricing power in the world two years ago and they passed it to the customers. what we are underappreciating, you talk about the ad supported model worker underappreciating the able to drawback in shared account. and they say there's probably 14 million shared accounts they will begin to monetize. not 18.99 a month but 3 or $4 an additional month and that will lead to an additional you know almost 2 million subs. that's the part of the netflix story um surprised they are not rewarded for rather than being punished for the discussion that, hey, we are concerned about subgrowth. maybe we need to go to an ad
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supported model. that's addressing what's going on. the consumer is now willing to you know the streaming consumer is starting to consume product much in the way we did on linear tv and that's the surprise. we will watch adance depends on the format. >> well, listen, it's interesting to me,-aagree with tim, it's interesting when i play the game remotely correctly i get ridiculed. when karen plays, she creates her room. karen did it and it's beautiful. everything is beautiful. it makes me crazy. it's clear favoritism on the set of cnbc fast money and i am putting my foot down. >> it is what it is. let's move on. joining us is cnbc founder and target media extive tom rogers. great to have you with us. i think the new data that came out just sort of reaffirms what we new about what was going on in the tv landscape. i want to start with how you think about the -- the media
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giants that have both parts of the business linear part as well as the streaming part of the business. how each is weighing and thinking about the valuation. >> well, it's great question, melissa. thanks for having me, and thank you for not putting me in the middle of the favoritism battle here. i think that what paramount plus and peacock did in terms of being able to feed both the broadcast side of the equation and the streaming side of the equation is a very smart play. it's clear that linear television is increasingly all about sports and news. it's why fox is most by rated of the traditional media company because it is all about sports and news. and on the streaming side, as you talked about, that advertising is now going to be
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a critical part of all the streamers' business models. there's nothing that drys eyeballs like sports. and so they have a need to fuel that side as well. i think the fact of the matter is that you have to look at who lost here. and i heard the conversation on disney and espn to me, the big loser here is espn. >> it's interesting. i will say it now. tom is a stud. that's out of the way, but it's -- we know the truths to be self-evident. number two, was inevitable but in october of last year, netflix finally fell on hard times. stock went from 700 to 162. you know all about it. but can there be a rebirth here in netflix because to the conversation we had, now you have valuation compelling, the world seems to once again be lining up for everything that reid hastings is doing.
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>> i think it's inevitable that netflix recovers more and is ultimately viewed as the winner. because what is not being factored in sufficiently certainly in the case of disney, but most traditional media companies that are pushing into streaming is how difficult the decline of the traditional business is going to be, how cord cut something accelerating. how ratings are declining, and while sports rights is certainly a good thing to help stabilize ratings, the fact of the matter is, when you are paying that much more for rights, and you have diminished audience, that just squeezing margins against very tough conditions already. netflix doesn't have to deal with any of that. while people have focused on netflix subscriber issues, they don't have a subscriber issue. they reach 100 million households in the united states. more households than any cable or broadcast network has ever
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reached. their issue as you discussioned before is the mondayation how do you monetize 30 million homes they are not getting paid for in that 100 million household reach they have. and i think it's if they figure that out, you have a lot of opportunity, not to mention the fact that the engagement they have at 30% of all connected tv audience viewing compared to disney plus at 5%, just gives them maybe not the pricing power people originally thought, but pricing power nonetheless when you have that much of the engagement share of the total streaming audience which is now bigger than cable. >> tom, should i call you stud, as we look at the horse trading among the assets let's talk about hulu because it's fascinating when you think about the players involved. and who necessarily would want hulu's business and there's question why disney would want that business. but what to you think will happen there?
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could comcast be a buyer and is the asset going to disney at some point for at least $24 billion or more? >> well, i can make an argument for why each of them could use it strategically. i think that it was the case that there were different buying conditions when netflix was that at 700. disney, i am sure, using netflix as a yardstick would be much more interested in buying it when there's a comparison of netflix at 240 and similarly, i am sure comcast doesn't like the idea of selling it when the leading comp is where it is. i think the thing that really has to be focused on, with hulu, is it is the leading advertiser streamer. it is the one that has been out there before everybody else said they would enter the
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advertising realm when it comes to streaming. they were the leading advertising service. one of the things that just got no focus on disney earnings, is that for the last three quarters in row the advertising subhas declined. this is before recessionary issues began to a push down advertising revenue. so, what is going on there that the ad revenue per sub was declining as hulu was the clear leader and now everybody else is going to have a ad tier as part of their offering with some great premium programming to compete with the hulu inventory. that has to be taken into account as you think about it. not to mention, that all the either all the nbc programming is going away, if disney buys it, or all the disney program is going away if nbc buys it. and it will be a very different service in that regard.
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>> yep. tom, it's great to speak with you. thank you. >> thanks for having me. and i am not a stud. >> tom rogers. well, they think you are so that's the way it is. we have breaking news here we want to get to. a news alert on home depot. they announcing a dividend and authorizing a share buy back. we have the details. into hey, home demow augustizeing a new $15 billion buy back that comes two days after the company reported better than expected earnings thanks to an increase in home improvement spending. and it also follows the passage of the inflation reduction act that does impose a 1% tax on buybacks. so certainly interesting timing. shares of home depot up .5% in. >> seema mody. karen, it sound like a big number. >> a big number but a giant company. but you know, for years, this is part of home depot's playbook, and they have done great job. and we know how under pressure
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the housing sector is. but i thought the earnings were fine this week. and i am long home demow and low. 's shares on move after reporting results. the numbers next,. rrcyndus mean trade and crypto cuen a single stock. he tfs the rise and risk of the high investments. don't go anywhere. don't go anywhere. fast money is back in two. and customers all on different systems. you need to pull it together. so you call in ibm and red hat to create an open hybrid cloud platform. and your digital transformation is helping find new ways to unlock energy around the world. i'm so glad we did this. i'm so glad we did this.
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welcome back. we have report on applied materials. let's get back to seema with the details. hey, seema. >> on earnings call applied material egg executives revealed q4 numbers and expect semis system revenue to be up 14% in the fourth quarter and incrementally increase gross margins through pricing adjustments and improved logistic costs. it's showing the head count growth while increasing research and development spending up 10% year to date.
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but like many semi-conductor players the zero loss in china set them back. most display revenue is from china. the market is one of the reasons for 2023 applied materials says demand is still above our ability to supply. they are working through the supply chain issues trying to identify them, tackle the issues, and they see output increasing over the next several quarters. stock is up about 2% and after hours still down about 33% from the 52 week high. >> thanks. seema mody. steve, what to you may of the quarter. >> so, you know how i don't feel incredibly bullish about this sector of the stocks. but this is a declining trend line from january and broke out of that at end of july. it is trading above it's 50 day and 100-day. the only thing it has to shoot for is the 200 day moving
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average. i would use the 100 day, which is 107, as a floor by the stock, look for a run to the 200 day as resistance, which is that 125. let it settle in a little bit tomorrow. see how the character of the trading affects it. but i believe they have an outsized exposure to solar panels, and with the recent bill that passed through congress, they could get rewards of that. so i would look for run to 200. >> no question, and steve was right to be cautious about semis. the whole space many month ago. art quarter was fine operating margins hung in there, i think, the stock is now trade 13 times next year's numbers but i don't want to get crazey about, because. it is cloudy thing it a problem. i would wait to see what invidia has to say on the 24th to set the pays a though they
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guide they didn't give you the quarter. and there are people whispering they will guide lower. something to keep in mind before you go into the semi- space melissa. much more fast money. here's what's coming up next. stocks or etfs. why not both? the investing craze that has some big volatileity. retail wreck. kohl's slashing guidance and blaming inplagues for a sales slump. ou yshldou keep shopping or check out? you are watching fast money live from the nasdaq market site in times square. site in times square. we are love and confidence... you can't buy those. but you can invest in them. we believe that your investments should work harder for the future you imagine. and that's where our strategic investing approach can help.
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welcome back to fast money. a new way to trade volatile stocks including tesla and etfs making sorting simpler. but do the risk outweigh the benefits. tom the vice chairman of market analytics firm great to see you. >> hi. >> why do we need the etfs when there are stocks you are trade or option s. >> short answer is it's more optionality for individual investors and tradeers who don't necessarily want to use all their cash they have on the sidelines. they can get leverage and they can go inverse and you know most investors have to fill out margins and option agreements to do that. it's a great way for them to hedge, but you have to watch it and it's a great way to get hedging instruments from market.
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and the market is volatile and the market they represent are great opportunities to pick them up off the bottom. or if you are not happy about them, on the you can apply the short side without margeins in when you talk about hedging, you are not talking about using the leverage products, because the leverage products you wouldn't -- you really shouldn't hold them for more than a day. am i right. >> no you shouldn't. you are right. so you were talking about chips and earnings and things like that. so, if these products like they represent in v dia if you feelers are going south, go in for a given day, and on the access invidia bear 1.25 to the negative, you can get that leverage to the down side and in short by using ultimately a long deal. >> tom, these trading vehicles to mel's question or are they vehicles for professionals that are you know, they can funds
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trying to get that leverage, because it sounds like for the average every day investor, these could be dangerous for lack of a better word. >> it could. so guy, you are right. it's not for the average investors. although etfs for the most part have been. they continue to evolve to try to grab more of the marketplace. but listen, you are absolutely right. they are aggressive in nature. they have to be traded almost on the daily basis. but for some investors, that are sophisticated or advisers or institutions, they come into play because it wraps everything up into one ticker. >> hey, tom, it's steve. so,. >> hey, steve. >> a couple things to piggyback. the other issue is they are not base -- they are based on a derivative which decays. so you have the fee of the etf, it resets every day. and you have the decay of the derivative that it is based on. so, just to piggyback what was
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said, it has to be a day event you are trading, but it doesn't come with a disclaimer that if you hold it longer than a day, you are actually decaying your money. >> well you are right. so, there's almost reverse compounding that's built into this, steve. however, let's just say there's companies that have had inverse and leverage. he tfs out this, for leverage and etfs and we know the fcc is looking at this. there's their's complex product rule out there under review. and they would like to be able to put some guardrails for average investors buying in the brokerage account, or make them go through some type of training or make them go through more disclosure or
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things like that. ultimately, tough give credit to the average investors to do their due diligence and if they haven't looked under the hood, run in the opposite direction. >> tanks tom. so karen, these are single stock. he tfs some leveraged to varying degrees on volatile stocks. as thissa professional hedge fund manager would you use them as vehicles or opt for other wastes like the options market. >> well, what could go wrong? really, what could go wrong? we have seen a couple times you know, the volatility index or whatever it was, we saw the u-s- o which is i know a little different animal because it has different parts of the oil complex or oil contracts going out. it seems like, you know, if you are sophisticated investor who understands the down sides, i would think it would be easier to create it yourself.
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just my guess. >> tim? >> first all, tom has been a godfather in the etf space for long time. it day is the etf space evolves. and continues to dominate and some level, the retail inhe vest is given more tools institutions have. institutions can create baskets and options quickly. they have the ability to single short stocks. a lot of retail investors can't short stock space based on the platform. everything we have said is true pup say buyer beware. do your work even with main etfs understand what's under the hood. he a talked about the leverage. he tfs and i think they are dangerous, but if you know and are tactical and if you are in and out and right, obviously, that's what it is. it's leverage. >> yeah, you have used these actually? >> i used, yeah, i have actually used these for as long as they have -- these have
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existed, i've used them. clients used them. at the biggest issue no matter how sophisticated people and traders don't realize they are one day vehicles. so, it decays that's the biggest problem that i have with them. if you can tell people, you're only using these for six and a half hours during the trading day, i have no problem with it. but most people are not going to follow those instructions if they are not notified. and there's nothing on the etfs that tell you that it's one-day thing. >> all right. coming up, the latest on ryan cohen's bed, bath and beyond sale. shares are dropping again after hours. the details that karen is watching go but first kohl's cut. slashing and rising prices hit shoppers. we are breaking it down when fast money returns. ththget your trades to go wi e fast money podcast any time anywhere follow today on your
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welcome back to fast money.
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we have a buzzkill on kohl's shares sinking will% after they slashed full year outlook setting a hard hit middle income consumer. here's michelle gases said about iter on the exchange. >> we expect back half of the year tore more promotional as the customers look for the value. we are also facing inflationary pressures in the cost of goods and freight. you know, how long this is going to go on, not sure. but we are doing lots of things around our business to make sure that we can navigate the period of time. >> kohl's expect full year revenues to decline klein versus last year and earnings estimates are trimmed by more than half. this was not a surprise to you, karen. >> you know, i had a grandmother that used to say you don't have anything nice to say, don't say anything at all. but i have a daughter who would say, mom, say what you really think. so, you know, it was not about
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the giant miss which we knew when they announced the earnings. no way were they going to meet those. it was not about the inventory bloat or category misses. to me, it's about a very pressured industry department stores, and a management team who i don't trust. i think they did a horrific job selling company and trying to pull their this is our new plan and it's fabulous. and misleading the shareholders. i can't get over that. so if you want to make the bet there's a cheap department store out there that can get it together and can survive, you got to go to macy's or somewhere else. i just -- i don't trust them. >> you still own this. >> no. >> you don't? you are completely out. >> no i mean i am competely out. >> okay. tim? what do you think? >> well, first of all, karen's
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been noticeably irritated by this story as she should be, and this puts more pressure on management, right. so the shares are undervalued doesn't mean you chase them. but i think there's a lot of of bad news and management in this. it only sets them up that much more for some of the same pressure that they have been under. they can't persist in the environment. so, don't really love department stores, really don't like their segment. i think we have macy's and nordstroms reporting next week. and i think they have slightly different segments. and i think that's part of the story where they have been more resilient. and the inventory issues kohl's going through is similar to what we are seeing in many other places. the difference is this a company that doesn't necessarily have the same ability to have a foot fall. they are not in the position. they don't have the same liquidity and this is something investors are focusing on. >> bill simon said department stores have to find a reason to exist. they have their internal maybe management created management
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enhanced issues to deal with, but they have an industry problem to deal with as well. they sell things that people do not need. you can -- you can -- you don't have to go there at all, and that's a problem. guy. >> unless you are returning amazon stuff right? >> right. exactly. >> which, you know, i am one of the people guy to the ups with we chat. >> i ups drop off for amazon. >> let me put a couple numbers -- just so we understand each other. the prior guidance was 6.5 dollars and guided to basically $3. and now by the way, the street didn't believe them and they took operating margins from 7.5%ish, down to 4%. i doesn't know what happened over the period of time. but clearly, none of it was good. so to karen's earlier point i dig her grandmother. i am sure i never met her but i am with her daughter on this
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one. tell the truth. and the truth in this case hurts. >> coming up, shares of bed, bath and beyond severning in the after hours as shareholder cashes out. what the chairwoman is watching in the filing that's next, and another shakeup at starbucks so with athnoer executive on the way out how you play the coffee chain. details when fast money returns. you're making all the difference out there kid. next big american. pressure, pressure? pressure, pressure. so where do you think this pressure's coming from? everyone. i'm just here for the mints. [ cheering crowd ] so much pressure. pressure makes diamonds. true. pulisic!
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welcome back to fast money. it's official, ryan cohen's r-c adventures sold the entire stake in bed, bath and beyond. the amcgme chairman off loading the stock on tuesday and wednesday for price between $18 and $30 a share. he also sold his call options expiring in january. adding to the losses in the after hours. so, karen, you have been watching this very closely. what did you see in the filing? >> so, this filing showed all the prices sold looks to me like he made $59 million off $119 million investment. which is great. but really, think it's that he made -- he made that money off
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what was much lower base after he got into it, right? shares really sold off hard after he got into it. in january, and i think that you know i think shareholders will be upset that he bailed on us, but this is a very, very different story now than march when he got into it as recently as a couple months ago, bed, bath and beyond was in a position to feel like they could do share buy backs. now, i think they are getting restructuring help because they are desk trading like they are going bankrupt. i don't blame him for getting out p it's different equation now. so, i know people are at him. i got no skin in this game at all. i don't know him. i am just saying, a little caveat if you follow the idea he bought struck at 75 this must be great even though the debt was telling you it's going bankrupt one other thing i think is interesting, game stop apparently on the back of the news is down $4 because people
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hate ryan. i guess. i got no feelings never met the guy. >> or they question, you know, his staying power in any of the names, and agree. i see how is it's a very different story at this point in time for bed, bath and beyond. the stock is down 40% right now. extraordinary move. >> it's unfortunate again, we talked about the last night and again i don't think he did -- i don't think any of us are saying he did anything illegal. my problem is it doesn't pass the smith test and the fact that karen pointed this out last night, the options if you went and looked at the filing, they were there, but somehow magically it came to the public domain over the last couple of days when agically the stock trade up to nearly $30 and magically once again, he decided it was a good point to exit. i don't think my opinion which i am entitle to he thought in his wildest dreams that this stock was going to $75. what i do think, though, is he understood what's going on in the market now, and if got
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their arms around that, it would be self-fulfilling the stock would go up. that's the problem that i have. >> i have to say that just as sort of a mainstream media play as roll. >> absolutely. >> discussions of the positions disclosed in the 13 efiling months ago. we talked about that as well. so it's all -- we talked about it because the stock was moving and after the stock moved we discussed that. so, it's all this sort of crazy viral thing that feeds on itself, tim. >> well, that's the world of social media and chat rooms and whatnot. it is interesting you know, why did we have to see notice of options purchases from months ago yesterday or the day before. and the discussion that i am hearing about, well, they had to restate the percentages based on a different share count outstanding, and so you
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know, it equated to slightly different options. like i am not sure that news was necessary to restate. and so, that's where i think people are a little frustrated here. that news came to market magically when in fact, it was not necessary to have it come to market. >> all right. let's check with retrail trader favorites one of the most active names but one trader is betting the stock is heading to huge losses. mike. >> yeah, so, certainly bed, bath andion was busiest and it was busiest one today. but the other stock that continues to occupy a high slot is amc ranking 5th. we saw double the average participants are getting involved because it's not just retail but what we saw was 20 hundred of the puts trading for
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44 cents it's high net retail. they beted weakness the stocks are starting to see could infect amc as well and decline below 12 by expiration. >> thanks for that. for more options tune in tomorrow at 5:30 p.m. eastern i'm. another shakeup at starbucks. how the latest departure will impact the coffee chain. we are breaking it down next. we are back if two.
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welcome back. a sneak peek at cramer cam. catch the interview at top of the money. -- top of the hour on mad money. and another leadership shakeup at starbucks. coo john culvert latest executive a leave. a year after he took on role in just months before howard schultz's set to depart as ceo. kate rogers has details on this. kate. >> that's right. coo at starbucks will be departing the company at the end of the year transitioning to executive adviser as of october 3rd. the company is reorganizing the leadership team eliminating the coo role at end of the fiscal year. culver has been with the company for 20 years, took over
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for brewer after she left for the ceo role at walgreens. and in letter from howard schultz about the executive structure change, he said our reinvention vention requires us to rethink the leadership struck tower create every opportunity for the new ceo and to accelerate delivery of modernized and elevated experiences for our green apron partners and customers. now that reinvention has been a very big focus for schultz who will be leaving at the end of the calendar year. the new ceo has yet to be named, but the company is speaking to external candidates for that role. and this is the fourth exec departure brewer left in 2021 and former ceo johnson in march of this year, william the evp of north mer and now john culver. back over to you. >> major changes. thanks kate rogers steve, what do you make of starbucks? >> yeah, forgetting all of that, all the fundmentals i shouldn't say but forgetting the corporate shakeup, the stock is broken out of a
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declining trend line recently. there's a scarcity value in coffee. you don't get that many publicly traded coffee companies anymore. i would wait until an it trades above the 200 day moving average around $90. but technically, the 50 popped above the 100. that's bullish. i would give it air to breath. and i would be a buyer above 90. >> tim, what do you think? >> well, look, the last quarter we got numbers, they -- the u.s. comps were excellent on price increase, and the china business was destroyed. we kind of knew it would happen. some of that has been reset. the dynamic is a combination of to what extent where margins are going for the company. that includes labor costs. and they have big union issues and ordered they had to rehire folks in memphis, and some union activists and whatnot
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and they created their internal turmoil but starbucks has really brought some of this upon themselves. if you look at the leadership dynamic, i think the company since kevin johnson, sat in the role has been in the rutterless. and they start using things about reinvention, and whatnot, it makes you feel as if it's a company that's lost. i don't think they are that lost. but i think that the dynamic around the shares is we still need to see that ceo in place, and right now howard schultz needs to name a new ceo. this is preparation for that. >> you need to see the vision and we don't have a handle on that. internal problem and external problems. walmart was talking about you know, household incomes over $100,000 going to walmart creating down from deli meats to cans of beans, gibing and you have to wonder is this happening so you can buy your $5 cup of regular coffee down the street? >> i can say without equivocation. >> or are you just cutting that, too. >> beans are not part of my. >> i know that. >> just so -- you should have
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been -- better -- you should have given me a better example. you could have changed it for me, number one, number two i don't think it's necessarily a good thing. but that's for farther down the road in terms of how we are going to look at the consumer things. but i will say this about starbucks. i am glad tim brought it up and check out kate rogers twitter account. she is on top of it. the labor issue is not going away. and i fear it's going get worse before it gets better. and although starbucks at 25 times next year's numbers is cheap historically to itself i don't think that's what you don't think that's what you want to look at right now we got this. we got this. we got this. yay! we got this. >> next, final trade. let's partner for all of it. rd jones you'll always remember buying your first car.
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time for the final trade. steve. chewy up 90%. keep it on a short lease in case it turns around. >> karen? >> short leash got it, steve. so ulta had a very nice run 40 bucks in the last two or three weeks. earning a week from now but i will sell upside 4.25 and it's 7.5 and it come so far so fast.
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>> tim tim. >> netflix is underappreciated about the market.. >> happy birthday sky. >> look at that enjury making the move. higher again. my mission is simple, to make you money. i'm here to level the playing field for all investors. i promise to help you find it. "mad money" starts now. hey, i am cramer, welcome to "mad money". my job is not just to entertain. give me a call at 800-743-cnbc. you can also tweet me. maybe it


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