monday. the ceo, peter raw rawlinson wi join us on monday. ending the week both apple and peloton up 8% on the week, given the outperform unions in china and elsewhere. that does it for you on overtime. "fast money" starts now. live from the nasdaq marketsite, this is "fast money." here's what's on tap tonight. apple engineering. are thing as good as the price action suggests? plus a rate rout. it's having an effect on some sectors. we're bring you the trades. and we're getting you early for trades on disney and lyft,

and the yen finds its footing. i'm melissa lee here with you tonight. we start with a human move last night on appear 8 after the tech titan announced a monster buyback, the largest in history across all companies. apple is no strange tore giant repurposes, reducing share count over the last year buying nearly $85 billion worth of stock. yesterday's announcement brings the total to nearly $700 billion. is not all just a bit of financial engineering. after all, overshadowed, it was a 4% drop in overall sales with iphone revenues down 10% from a year ago. that's the largest decline since the pandemic. other products, like the watch, airpods saw sales down.

tim cook said he feels good about the businesses in china. recent. >> reporter: has suggested that apple is in fact losing share in that region. is apple using the buyback as distraction to get the investors to look away? did we just buy that today in terms of the stock popping today? >> no, it's not a distraction like tesla. apple should get the benefit of the doubt. five years ago they issued debt at zero rates and it gave them the capital markets flexibility. i think every analyst will say that's part of the reason, if anything, they trade at a premium. it's also the services business, but if you want to think about some of those comps, first of all, very low bar coming into the numbers, but obviously a difficult comp in the one-off. in tim cook and the company have explained, if you remove that, you're standing in the pork,

saying it wasn't that bad. the outlook is at least year over year, for fiscal full '24 there will be some revenue growth. you add in the market expansion, somewhere somehow there's an a.i.-led product psych the refreshl. if we're just asking about apple, is this smoke and mirrors? absolutely not. it's real. it's nothing fake about it. >> yeah, being i don't think you can take a market expanding to the bank over the nest year or so with margins being real flat. they're goingto be around that ecosystem over the next few years? we don't even know what the product is. hopefully they'll give us a blueprint in june, and consumers really won't get their hands on it if it shifts in the fall. the one comment to me more than anything else from last night's

call, aside from the buyback, is they're going to be spend ago lot on generative a.i. and granted, listen, we know they were spending on titan, the car project, but at some point if they don't have a commercialized product, if it doesn't create an up cycle, then that spending my tutly be a draw on margin, too. to be that financial engineering is something that will have to remain in place. at the opened up, they have gone to the market and done accelerated buy dpback then thee

going to sit and forget the -- over the last two years. it sounds like a bad theme, but in this -- with this pop, are we giving apple the benefit of the doubt? and a turn in china, when it seems like, in terms of the number of units sold, that was down, but the asps were higher. >> for sure the market is giving apple the benefit of the doubt. i thinks it's they'll leverage the work of other companies, and the thing that's beneficial to apple that i don't think a lot of tech companies have, they have trust with their customers in a way that google doesn't.

>> that is -- i don't view the share buyback as financial engineering. as a shareholder? any company, i look at it as a vote of confidence, but the ability to own more of the business. so, for me, it's a pretty positive quarter for them. there's a hue sludge of -- so $110 billion buyback is material when you consider it absorbs marginal supply that might be coming from active managers. i'm with dan here, maybe we're at a fairly reasonable

valuation. look. it's an acreasive thing for shareholders so, you know, when you look at it that way, it's a reasonable thing for cuttss do, is it a reason to chase the stock? i don't think so. >> it's really what is the multiple you will pay on the stock. this stock has been all about the multiple, because you've been attaching it to services, maybe to some capital markets in the past. if you want to pay 30 times, jpmorgan, i'm looking at a note, they could put a 225 target on it. if you want to put a 26 on it,

you can do the same math. that to me is where we are. does this compete discover a peak multiple, i don't think so. when i think about where the company has been, and julie talked about trust with the company, or the consumer has trust, does the investor community have the same trust with apple as they had two years ago? it's been a big underperformer, even with today's move, it's underperformed by about 50%. i picked the high point, so it's not that leader, even though i think it's a very safety place to be in a world where bad news is good news. >> i understand the privacy aspect, but in terms of trust with apple in terms of a product that actually works, that doesn't exist -- the ongoing joy

is that siri stinks, right? when you say you want to google something, it's become the same word as search, right? >> hey, siri, melissa thinking you're not doing a good job. >> listen, what happenle has done. iphone is synonymous will cell phone. they have built a great waeshl business, they built a great ecosystem, andi think that's what julie is getting to in a way. when we don't have trust about a lot of these other digital platforms forsh we do trust apple for a whole host of reasons. i don't find what's going on here particularly interesting. it's a $400 billion revenue company. margins have improved a bit.

that's where they wanted to go. that's why something like a vision pro or vision computing could be interesting, but it's not interesting right now. what they decided to do in generative a.i. lives in that world, too. so there might be another stage of growth, but talk to me about what that looks like, going from $400 billion in revenue, then 450, 500, but the spend associated with that will be considerable. they're buying at the stock, is it acreasive on the short-term cash if they're buying back stock that maybe is growing earnings at mid to best hide single digits? it's not that attractive. the s&p 500 dividend yield is three times that of apple. >> i think you're overthinking this one. >> let's split it up. >> i think you agree on a lot of stuff. >> we do.

>> yeah. >> it's right to point out the overall growth of the company. i get it. i kind of feel like, and julie said this, i like the company putting where their mouth is. they're not the devil, as some have said. that's part of the reason people might be having this reaction here. i think there's been a focus at time, cutting corporate taxes, and i understand there's a cycle there that's happened. it's not apple. >> the other question, mike, is in the earnings call, did we come away feeling better about the china market and the prospects of the china market in, say, six months or so. do you think they're going to stop losing market share there? do you think the consumer will turn around? what do you think? >> i think that china's

situation is pretty grim. starbucks is not the same as apple, but if they are a canary in the coal mine in any way for china consumers, they didn't tell us a very good story this week at all. we also didn't see sequential year-in-year growth. it's great to talk a good game about what will happen, and we won't see giving up market share in chain the way we thought we were, but ultimately you have to start with the numbers. well farthero is bullish on the new note.

aaron is the equity's strategist. great to have you with us. thanks for having me. >> what struck me in the conference call, aaron, you asked that very question in terms of china. we've gotten so many data points, which shows down 19% in term of cease, and you asked. what are we missing here? did you get a good answer? are you satisfied with their china business? >> well, i think timmy answered the question spot on. he can talk to his business. to your point/counterpoint research, even the internal data showed a 30-plus percent decline, at least in the first two months of this most recent quarter. the answer is somewhere underneath of the shipment number. you mentioned earlier mix, they mentioned off-line, strong mix of iphone 15 pro and pro max.

so them to grow was notable, and why we asked that question. >> what do you think the dy dynamics will be even in a strong iphone cycle, aaron? they were really relying on mix, the more expensive phones. is that the kind of market dynamic we will expect? that would seem to me they'll be ceding market share to competitors. >> i think it's going to be competitive. i think one other consideration is they even grew without the tough compare when adjusting for the impact of channel fill until last year. we think it will be a competitive market. we think there's a strong growth for china and the opportunity going into the next generation this year presents a positive driver, which is why we stuck by our overweight rating.

>> i see your price target is on the screen of $225. talk about the multiple behind that, and, again, where you are relative to apple. there's been times for a peak relative to itself. do you think that's here? >> going in, we thought our note would be more cares, but clearly the services growth and now ticking to the a.i. narrative, we think there's catalyst ahead we believe it can hold a high 20 multiple, if not 30. one other consideration i would highlight is the fact that apple includes stock-based comp, it's about close to 10% dilution to the eps line. we think the valuation into the

high 20 multiple range, comparable to the last five years, is justified given the breadth of what apple has. >> when you talk about catalyst, again, you just mentioned heading into the print. i said this on monday. i would have loved to have seen the kind of quarter they released and nothing else. i think the stock likely would have traded down off that or flattish, certainly would have gapped up 8%. that could have set up for a decent trade into wwdc. talking about cal list, you have followed this company in a long time, where generative a.i. will live supposedly on this device, right? enabling a bunch of services. do you expect on the fall any wiz bang product coming from apple that will cause a meaningful upgrade iphone cycle? >> one of the things we put in

our note, there was a research paper published about a month or so ago, talking about smaller models, uses partnerships, you know, others have highlighted google, but, you know, we think that they can do a multi-modal, large-language model on device that will be confide attractive. apple does not nearly spend the cap ex that some of these other hyper scale cloud customers do, so we think that's attractive. the final thing i highlighted, important to remember, appearing has been embedding a.i. processing neural engines in their s.o.c.s since 2017. they have a long track record, which is part of the differentiation for the story. >> aaron, great to speak with you. thanks for your time. >> thank you.

julie, you own it. would you buy it here? >> as an owner i'm happy owning the stock here. i can understand the hesitation with wanting to buy after today's move, but if i compare this to, say, tesla, in a "would you rather" i'm paying half the multiple with a business with more recurring revenue, and arguably more competitive, and i think that's compelling when i think about large-cap tech. >> that's an interesting "would you rather" which you did by yourself, unsolicited. i'll ask another one, mike, apple or alphabet? >> i would rather alpha about the, and microsoft, too. we own apple. one of the things i was commenting about, i wouldn't chase it here.

we own it, we didn't sell into this. it what wasn't's overwhelming reason. coming up, builders, banks and big techs, a wild week for the market. will next week make it three? plus lyft refrevving up. >> announcer: this is "fast money" with melissa lee right here on cnbc. old school hard work meets bold new thinking. (laughter) at 88 years old, we still see the world with the wonder of new eyes, helping you discover untapped possibilities and relentlessly working with you to make them real.

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here. the two-year was even more pronounced. we went to basically, roughly eight other nine bips out to september. now we priced in a cut. so it was a week where we had a chance to come off the fed meeting. no matter how hard he tries, powell always sounds dovish. says six months weaker. i don't know why ear not buying money centers here. whether at 470 or 440, we have higher rates, it's interesting

that the started with the kres. they olympic up today at the highs, closed at the closed. they're still down 8%, when yields come in, that should take a little pressure off of that. down 6.5%. leading up into it, it filled in that gap, and it's lost some steam, and maybe that's a broadening out. but these don'ta act well.

>> earmuffs out there for karen, if she's listening. just that on its own -- i don't think that's a place i think it's hard to prediction where we are. it sort of sounds like a remodel project, it's going to be done in june, september, december. i think that really leads investors to feel leery. one way or the others. >> mike, how do you feel? it's not just about interest rate moves, of course, and

really it's what do you have, is it to retail? if it's anything, frankly i don't want anything to do with it. that's a good reason to stay away from it right there. we own home depot, for example. we have a lot of demand that has not been met, and demand is going to be there. it's almost dependent, as lot as they say four or below, i think they'll have sufficient demand there. if rates come down on the long end, that's supportive of that.

>> hay, melissa, they'll that's happening, because the exxon mobil deal to asquirt pioneer closed today, so now this will be replacing it. you see it up 3%. back over to you. >> julia, thank you. here's what's coming up next. >> announcer: we lift off and visit the magic kingdom to take on next week's earnings reports. what they're predicting. into plus, the oracle and the apple. has berkshire hathaway's huge bet on the iphone maker gotten too risky? one votes says it could kay on

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and the same fears just like yourself. i'm so sure that travel is good for the world. it's really the best to engage with the locals and the destination. and i think travel helps broaden the human mind and makes us kinder. and that's fantastically valuable. welcome back to "fast money." we have liftoff, lyft up more

than 5% since monday. the stock so far has outperformed uber after revealing a typo. >> somehow we snuck that in, very kind and convenient. i think it's a normalizing environment i think the guide will be solid. to me over time i think this story will play out. it's a case of management and

confidence in which there have been very little at lyft. i think that's part of reasserting. >> i was looking at it. it's expecting a positive one. i was taking a look at the overall sentiment, which has been going on and it's probably in the 95th percentile. it is expecting some volatility, though, like a 17% applied move

one way or another. basically saying that there's a lot of profitability effort in lyft, but in the longer term, lyft still has to spend. that's something to be cautious about. julie? >> i think other problems is they've seen so much inflation in terms of shuns, so we should be getting an update for that. i think their model is not as resilient as uber. so i would pick uber over it. i agree, i think expectations were extremely low for this company, and management has made important change that have gift people more confidence. coming up, it was a very un-berkshire-like bet when warren buffett took the first stake in apple, but will it continue to pay off? we have one expert who says it

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welcome back to "fast money." stocks ripping higher to end a positive week after a weaker jobs report gave investors hope. amgen seeing the best day sin 2009 after a big earnings beat, also announcing the injectable obesity drug is expected to be released later this year. a strong week in asia, up.5% against the dollar, bouncing back from a 43-year low.

chinese tech ripping higher, the highest level since august. in the meantime, apple's bounce gave a boost to berkshire hat hathaway. shares are up nearly 600% since they started buying the stock. 60% of the portfolio, "wall street journal" asks, is apple becoming one of the riskiest investments in that portfolio. gregory, great to have you with us. why so risky? just because of concentration? >> it's an expensive stock, we know about the growth issues, and yeah, they have over 40% of their portfolio in one stock, so

one can have concerns. >> back in february berkshire hathaway trimmed, and that created speculation that they were fur sell shares. it doesn't seem like response portfolio management to have such a concentration. >> listen, farther be it from me to criticize warren buffett, but that's a big concentration. the crop-argument is what do you want to do? on a relative basis, maybe there's nothing more attractive, and frankly they've done so well in it, in some ways they're being penalized for do so well form it's hard to unhow this has been. it's the greatest investment in his career, and he did it in the middle of his career, but now it's a bit riskier. >> do you have any since, obviously they have very large holdings in things that are not in the public market, but, you

know, mr. buffett, as you said, he's aging. at some point there will be a succession here, the person who follows them will probably want to put their own mark on the company. how do they get out of it? it seems like a hotel california of trades, if you will. >> yeah, to some extent, but i think his successors think about it more than he does. they are the ones who put the original research into identifying apple. to his credit, not only did he get on board, but ramped it up, put it in on side, and again he's been very careful and wary of tech his whole career. to make the greatest investment is pretty impressive. yeah, it's almost impossible for them to dump it, unless they do it slowly over time.

>> there are few 589 tiffs. it seems like a lame sort of reason to stay. when you're talking about the disparity in the s&p 500, you would think there are values out there to be had in various sectors. this is exactly the kind of market that warren buffett should thrive in theoretically? >> there are alternatives. charlie munger, i got to see him in september, so he made the point that few people underestimate how size is important for him, something that moves the needle, and doesn't get caught up insmaller positions. they need these kinds of big positions. it's not clear how many stock stocks can move the needle like apple. >> if i had a had 3%% in any one name and another six stocks probably would make up in the

balance, because you add in chevron, axp, whatnot. i think the concentration is the risk we're probably all getting to. how about a dynamic, where there are other megacap stocks that probably will be apple-like? microsoft certainly, the cash flow generation certainly -- here we are speculating as to what could be the next investment committee. do you think they're talking into other high-capacity stocks that could fit into a economy that is frankly has become commodityized. >> nots it could be one of his riskiest investments. i don't think they're reconsidering this investment. my sense is, and it's hard for me to tell, that they're still enamored off supportive the

company. their hope, and i think the people that are fans of the stock is the rest of the portfolio grows to the point that apple doesn't domination to the extent it does today. >> thank you for your time, gregory. don't miss the live coverage of the 2024 annual shareholders meeting starting tomorrow 9:30 a.m. eastern time. mike khouw, is it 40% of your portfolio? >> absolutely not. nothing is, though i wish it was. it grew into that percentage. that's the part about picking stocks and disdisciplined about never selling, which is essentially the man dade he's given himself in the past. this one definitely has run, and i think it's worth reminding everybody, too, 1% of his portfolio is in cash as well.

coming up, wrapping up a bitter week for starbucks, reeling under disappointing earnings report. could there be a bounce brewing in this name? we're laying out an options trade ahead of the results. more on the media giant when "fast money" returns.

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welcome back to "fast money." starbucks laying claim to our chart of the week, that stock plunging more than 17% since monday, with most of the losses coming after a major earnings miss and lower full-year guidance. that marks the worst week since november 2008. to borrow a phrase from the chart master, is this chart so bad it's good? mike, you thought it was good the whole time, because you own it. so, did you act? >> we do own it. not a great week to be a starbucks holder. you have to say i was caught off by the results this poor. it's not a favorable way to

dissect the results. i'm a bit surprised we didn't -- i think this number deserves a preannouncement, so i'm a bit surprised we didn't get one, but it doesn't sent a good message. one of the big concerns with the china side is they were concern they would give up market hair to other competitors. that doesn't seem to be the case, but it does speak to a weak china le consumer. so, the short answer is, i'm not adding more to a position that looks so bad technically, and it's on a negative growth trajectory. you would say, this is as cheap as the to be hack in 12 years, and it has been. >> so bad it's bad.

julie, i saw your head nodding. >> i think you have problems everywhere you look. the multiple of 19 times is still questionable. the earnings outlook and visibility is so weak. this new ceo has been in place for a year. they've had to consistently cut the same-store sales guidance. this was a pretty shocking miss, honestly. i agree with mike, a preannouncement would have been nice for investor. it's true that china market share is being managed, but they're still seeing 'decline. to me that's what's most concerning about that market. >> by the way, i counted nine coffee prompts in our reads? >> really? >> it's been a bad six months. it was a terrible quarter.

i mean, the price action. i sold 60 puts out to january taking advantage of the volatility, and at 60 bucks, a projection for 25 is trading at about 13 times. so, you do get to a place where, i think with a company like starbucks, something so cheap, those are those moments you're looking for. the company has a lot of issues. julie nailed the point this management team has been wrong from the start. >> interesting, i heard this a few times, this warranted a preannouncement. what do you think would have happened if they gave that quarter and guidance? it might have been down a lot more. >> i agree. >> that almost seems panicky. i would rather do it in a fashion where i get the entire community focused on this. coming up, it is not over

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welcome back to "fast money." the busiest week in earnings is over, but the action is not done. disney is reporting next week. mike has a bullish trade into the print. so, mike, laid it out. right now they're employing a move. that's larger that is -- the most active contract with a week 120 calls that expire next friday. i would fair selling those calls and using the proceeds to a longer dated call action. i was looking out to the august 15. and then capture some decay associated.

>> i tell you, the momentum on the bottom line is very strong for disney. the question is in streaming guidance. i would actually be blown away if the guidance doesn't remain very strong. box office, it's kind of a meh. i think the momentum goes higher. >> julie, you feel good about going into the print? >> i think parks will do the lion's share of the -- but streaming still seem to be challenging. they have a position that's great in their business, but the ability to stain that momentum, that seems like more of a question market. >> i go back to the netflix print and how many subs they added. it had to come from somewhere.

it was not created out of nowhere. that gap that disney had in the last quarter, that looks like a danger zone to me, if there's the slightest issues in the quarter. i would be cautious. all right. final trades are up next. after last month's massive solar flare added a 25th hour to the day, businesses are wondering "what should we do with it?" i'm thinking company wide power nap. [ employees snoring ] anything can change the world of work. from hr to payroll, adp designs for the next anything. ♪ (alarm sound) ♪ amelia, turn off alarm. amelia, weather. 70 degrees and sunny today. amelia, unlock the door. i'm afraid i can't do that, jen. ♪ (suspenseful music) ♪

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it's odd how in an instant things can transform. slipping out of balance into freefall. i'm glad i found stability amidst it all. gold. standing the test of time. final trade time. ju julie? >> you know, if you think rates have peaked, but you're afraid of home builders, transunion is a nice way to do that. >> mike? >> home depot will be reporting on the 14th, probably no return

to growth, but probably will be by the end of the year. >> disney. channeling my inner buffett, chevron. >> i'm cautious, let's hear what they have to say. thanks for much