Transcripts For CNBC Mad Money 20150305

Unmet needs or changing courses during changing times. Yet, its a terrific part of this amazing longterm rally, including today, where the dow climbed 39 points, s p advanced 1. 2 and the nasdaq gained 0. 23 . I know this factor is underestimated because i see it every day. This morning we got a textbook example. Right now theres a widespread perception that stocks are expensive. You hear it all the time, bubble, bubble, bubble, bubble. If you did read this mornings wall street journal, you might have see a story entitled frostbitten costco is on thin ice. In this ahead of the tape al article, we see the kind of negative bias thats become so characteristic of this moment. This story says and i quote, thursdays results of course meaning this morning had the potential to disappoint, given that the stock is more richly valued than oush usual. Whats the worry here . Another month of zero samestore Sales Numbers growth or worse may make investors see the tank as half empty, rather than half full. Fortunately, this ahead of the tape column was actually behind the tape because costco released its earnings at 3 00 a. M. This morning, and what were they . They were spectacular with an amazing 8 samestore sales increase for the quarter and a 4 gain for the very cold month of february, not zero, not negative. So, what does this tell you about this particular market at this particular time . If you read the article before you saw costcos results, your mind races and you think, oh, my scary. Very expensive stock, has run way too much like so many others. But then you see the actual numbers and you have to do a radical revaluation, because costcos neither frostbitten, nor on thin ice. Its undervalued, and yes, underestimated. Why is that . Because i think neither the journalist involved here nor his or her editor nor the people whom they interviewed for the article recognized how strong ceo Craig Jelenek and his team really are. So whatever bubble you may thee costco may be caught up in, its directly contradicted by the facts. Perhaps the 66 billion retailer is worth more than what its selling for based on these numbers, not less. Or kroger up nearly 7 today, after reporting an incredible quarter. Ive been pounding the table on this kroger story since spending time with management and recognized how competitive they are and how theyre leveraging their scale to wrench the profits from the Food Companies that supply them. I like krogers strategy of consolidating a once fragmented industry. I like the krogerization they do once the accusations are completed, where they use their buying power to bring down costs. They are the smartest at integrating sales on all levels. Hey, listen they hired r. R. Donnelly. They integrated an omnigeneral approach from Groceries Stores going from fliers to your home to instore promotions. Thats brilliant they have the highest penetration of highmargin private label store brand merchandise and the Largest Selection of natural and organic products within the Traditional Grocery format. Krogers samestore sales are peerless and rival whole foods numbers, exceeding them last year when they had 4 gains, and they just did it again, a 6 number this morning. Thats amazing for the nations second largest supermarket chain, which you would have thought was dramatically overvalued given the run its had. These guys are taking share from everyone. You name it. And you know what . Its not over. Its such a juggernaut that i had to go see it for myself. I couldnt just say, oh, well, kroger, kroger. No i had to go kick the tires. So, i went to fred meyer. Thats a kroger division. During a recent trip to klamath falls, oregon where it was by far the nicest supermarket for miles. What did i find . You know how segregated many supermarkets are between the regular pant entryry goods and the ghetto of natural and organic . Not at kroger. The merchandise was integrated right in the aisles with the regular goods and the prices are so competitive, you cant believe it for natural and organic, thats right lots of people out west by the way, have revoted against the allexpensive and consuming and taking up landfills packaging that many foods have come in. They are revolting against packaging packaging. Kroger had aisle after aisle of containers of fresh goods, fresh seeds, fresh nuts other goodies that you lift up a latch and the stuff comes pouring out right into a baggie you can grab at the stand. No plastic, no large things no liner board, just the food packageless. Their produce was more natural and organic than the other way around. The displays were beautiful. I even tweeted one jimcramer. And when i checked out, i listened to all the cashiers talk to customers about what their store could be doing better. They knew many of the peoples names. They talked to me like i was, like, from klamath. I liked it. Ive been going to the same supermarket for years. No one knows me. Okay . What krogers doing, its called execution. Its the reason why krogers still inexpensive, even if its sponsor moved from 50 to 74 over the last few months. Bubble . No. Value. Then take pharmacicla. They had a market cap of 36 million. Today they caught a 21 million bid from abdi even though it was already up more than 88 year to date. I felt terrible about it. I think they dramatically overpaid, but you know what . There was not one but two other bidders besides abvi including j j, and thats the companys 50 50 partner for major antiblood cancer franchise. Now, without a bid, pharmacyclics hopelessly overvalued, bubble bubble bubble, bubble. But wait a second it could have a drug that could be a blockbuster, okay. Johnson johnson was said to have won the bidding war for the company, according to the new york times, which, of course articles wrong the moment i read it. But at the last minute avdi came in with a preemptive blast of stock and cash. Why so much . Because abbvie has a new drug thats about to go off patent over the next couple years, and without a replacement, abbvie will see its earnings cut to shreds. Of course, it cut its stock to shreds today. They have ann met need for earnings. The drug could do 5 to 6 billion sales by the time the other goes off patent. Half goes to j j because of the partnership. They have other drugs, too which could accrue to abbvie making it more valuable but pharmacyclics seemed like a bubble yesterday, but then a Smart Company made a bid versus some other smart companies, calling into question the whole idea of the bubble valuation. It also makes sense that youd think that isis pharma receptos and biomarin all of which have been on fire are cheap. Cheap the way pharmacyclics was, because they too can get bids and you know we like all three companies and have championed them for more than 100 some cases. And lets not forget valent and activist, two Major Drug Companies whose stocks have rallied pretty much nonstop since acquiring salyx and allergen allergen, although we heard endless chaleter about them overpaying. Can we just stipulate that they didnt pay too much . Even as actavis did buy allergen for more than twice of what people thought it was worth. At 200, i thought it was nosebleed, but people who bought the stock feel great. How about the semiconductor or avaga. They were duking it out with competitors and then merged within moments of the cant beat them join them philosophy. Why not . If a combined company can combine a one stop shop for chips that can go into cars or homes, it is indeed a standalone, but bold . No. Just combine companies that have more earnings power than two Standalone Companies would. Finally, let me give you another accessible one, just so people dont think im cherry picking. Darden, parent of olive garden. For years, its been a poorly managed restaurant chain that included red lobster. It was terrible execution quarter after quarter. Then, the board replaced the ceo and since then the stocks been off to the races. A company that had been run poorly at 44 bucks is now a wellrun institution at 64. Bubble . No, undervalued company that after execution is now fairly valuable. Some bear could argue that all i did was pick the absolute best examples and theres another 6,000 stocks i couldnt do it with. But you know what . I did select a couple of companies to buttress my nonbubble thesis but i could have done it to many many moroz. You could contend all of this goes away if the fed raises rates, but the stocks i mentioned have nothing to do with that. Heres my bottom line there are dozens of other companies that i could have fit into this piece without any problem at all, dozens of other companies that are very well run enterprises that are continually underestimated by the pundits and the head of the tape column and so many other people who simply refuse to consider that this is a market of individual stocks, and many of these stocks belong to companies that are managed by people who are capable of going well outside whats expected of them rendering their stocks cheap, even as they seem very expensive on paper, at least until terrific results or huge takeover bids put them in an allnew light. Now, i speak to dan in wisconsin. Please dan. Caller good afternoon, jim. I have two questions. Sure. Caller you have lp selling at an additional 69 million shares of its stock at 11. 05 per share. What is the impact going to be on the stock sale tomorrow and is this a buy, sale or hold . I dont like laredo. All of those doing access capital, with the exception of theres one or two that i dont mind. But ive got to tell you, i like the ones like an eeog that didnt need to do this because they had such a good balance sheet. So, im not going to stoop to the ones that are selling capital now all the way down. Thats not my style. Busy in nevada. Buzzy . Caller booyah to you, jim. Booyah caller im a threeyear religious listener of your show. Thank you. Caller i need your opinion on Las Vegas Sands, lvs. I have a couple of hundred shares. Want to know if i should sell some, take a profit hold the rest or just sell. Okay i am very concerned about Las Vegas Sands because im very concerned about wynn too, because they rely on big junkts from china and the numbers are down almost 50 year over year. That makes me very uncomfortable. Recommending any of these stocks, even as i think that mgm does have up side because theyve got a perfect business in the United States. The other guys do too, but its too much of their business is in macau. Okay guys it is all about execution. There are wellrun companies that are underestimated. And yes, contrary to popular belief, undervalued. On mad money tonight, the fight to crush isis is fueling a boom in defense stocks. Whos best equipped to protect your portfolio . Dont miss my take. It will surprise you. And cold stocks from amazon and tesla are showing new signs of life. I know you like those, but will they take you to the Promised Land or just to the house of pain im going to separate the real from the fake. Plus, theyre the brains that keep your local car dealer on track, but this stocks had a rough ride on wall street. Ill see if we can race higher with it when i take a spin with the ceo. Why dont you stick with cramer . Announcer dont miss a second of mad money. Follow jimcramer on twitter. Have a question . Tweet cramer. Madtweets. Send jim an email to madmoney cnbc. Com. Or give us a call at 1800743cnbc. Miss something . Head to madmoney. Cnbc. Com. Help brazil reduce its overall reliance on foreign imports with the launch of the countrys largest petrochemical operations. When emerson takes up the challenge its never been done before simply becomes consider it solved. Emerson. Ever since the markets ebolainduced bottom back in midoctober, its worth noting that the aerospace and defense stocks have been absolutely on fire. This is one of the Leadership Groups that helped the market power higher. Boeing, the big dow stock, its up 33 since october low. General dynamics up 19 . Lockheed martin one of our faves for a long time up 20 . Northrop grumman up. Stock United Technologies charitable trust, up 24 . No doubt about it this sector has been a powerhouse and its so easy to understand why. A year ago at this time a lot of people were worried that the business was drying up for the defense contractors. The wars in iraq and afghanistan, they were either over or winding down. The pentagons budget had been given a haircut. If not a total slashing. By the sequester. Remember washingtons notsobrilliant plan to detain spending by cutting across the board . And the militarys a giant source of business for these companies. Fastforward to today and the defense business what can i say, its booming. Not only have we been bombing the isis lunatics since september as part of a mission that president obama has admitted could take years, but with terrorism seemingly on the rise all over the world, not to mention a shooting war going on in ukraine, even if its not exactly hot, more like lukewarm, countries across the globe are realizing they cant rely on the United States to be the worlds policeman all the time right now. We dont have the money or inclination to do so. They have to defend themselves and that means giving more business to the aerospace and defense firms that are quite literally the arms dealers to the militaries all over the world. Plus, it doesnt hurt that the president and congress were actually able to pass an omnibus spending package back in december that included a muchneeded boost in defense spending that seems to be overlooked by many. In short, you know what it is a great time to be a defense contractor. I mention all this because theres one aerospace and defense play that i think has been flying somewhat under the radar screen. Im talking about the newly minted orbital atk. And the symbol here is oa. The company that was created less than a month ago when alint Tech Services merged and spun off a Company Called vista outdoor. The new orbital atk may be smaller than the major defense titans with market capitalization of just 4 billion, but its nevertheless a top player and i think the stock deserves to go higher. Plus, at a time when defense stocks are soaring, this is cheaper than the rest of the group. I think its a bargain versus every other company i mentioned. What exactly does orbital atk do . I used to joke that the other systems dealt in lead like Steve Mcqueens magnificent seven, because so much of the business was making bullets, except it had fewer competitors than mcqiueen, but thats a smaller part of the business. The new orbital atk is a leader in Flight Systems, getting nearly 32 of its sales from space launch vehicles and aerospace structures. On top of that the company also gets 26 of its sales from space systems. Its a major builder of major government satellites and space components. Its true that back at the end of october, before the merger closed, the old Orbital Sciences had a pretty highprofile accident where one of their rockets, which was set to deliver cargo to the International Space station exploded at its virginia launch site. Fortunately, it was an unmanned rocket, but still caused the stock to get crushed. It went down 15 in two days. I dont think it ever recovered from the taint of that. However, this is the kind of story that makes big headlines, even as it doesnt really have much impact on the bottom line which is why the stock has literally been able to rally more than 40 since its middecember postrocket explosion lows. Companys insurance covers any financial damage and they have fixed the problem and will be able to resume supply runs for nasa starting next year. Obviously, i hope this kind of accident doesnt happen again. I dont want anybody to get hurt, and that tends to happen when things explode. But if there is another accident that pummels the stock, realize the last one turned out to be an amazing buy accident. Orbital atks flight and space divisions are going very strong. They were the first private developer of space launch vehicles. We talk about that all the time. Theyre the leading producer of solid Rocket Propulsion systems and are a major player in the Missile Defense business. I know obamas not a big fan of the Missile Shield idea but considering how aggressive Vladimir Putins been lately, and hes even worse than the nutty but suv petrov ill bet our al glivz Eastern Europe are desperate for us to bolster their Missile Defense systems. Plus, not only do they have 95 satellites currently in production, they pioneer human and robotic inspace snrit servicing and logistics systems. You know thats the way defense is going to go and the Company Components have more than 800 satellites in orbit. In addition to Flight Systems and space orbital atk gets 42 of its sales from defense systems, including everything from tactical missile products to precision guidance systems for artillery shells. You know theyre in use. Armament systems, ammunitions and inergetics, military double speak for explosives. Even after the spinoff of the other business orbital atk remains one of the Worlds Largest manufacturer of small to mediumcaliber ammunition as well as the plain supplier for mediumcaliber ammunition like the chain gun bp we all know the truth, which is that natos going to probably actually start spending a lot of money again and atks going to get its share. Put it all together and youve got a highquality Aerospace Defense business thats expecting 150 million to 200 million in annual revenue synergies late next year because of the merger as well as cost savings. Plus, the combinational of orbital and atk means it has a ton of crossselling opportunities. Because the merger just closed less than a month ago, there is not a lot of visibility into orbital atks nearterm prospects, which is why its cheaper than the rest of the group. Its cheaper on any metric you name. Stock trades at just 13 times forward earnings, even as, get this, general dynamic, northrupop grumman and others suffer 17 to 18 times earnings. That is a huge sdpount, people. And even though orbital atk didnt give us any guidance for 2015 until may, they have made robust threeyear forecasts which are substantially better than the others forecast. From 2017 to 2018 they expect to grow revenues at 4 to 5 annual compound clip while the revenues increase on a compound basis. That may be you kind of probably cant get your arms around it, but consider this many of the big boys like lockheed, which we like, and northrupop grumman, we like they are currently looking at declining sales in earnings for 2015. You could make the case that orbital atk deserves to trade at a premium to all these stocks, maybe the whole group, not the huge discount it trades at. Even though it only has a 1. 9 yield, the ceo has suggested there may be a boost, a buyback when the board of directors meets. So, im trying to get you in ahead of that. Bottom line is the aerospace and Defense Group is in the sweet spot and i think the newly created orbital atk is the one to buy, given that its so much cheaper than the rest of the cohort, despite having better growth prospects. The stocks been flying under the radar since the merger close last month, but sooner or later ill bet the rocket that is orbital atk will launch and launch right into the stratosphere. Hey, you know what theres much more mad money ahead including my take on coal stocks from tesla to amazon. Should you join in or are others more worthy of praise . Then dealertrack helps connect customers to the best line of credit. Can it race higher . Ive got the ceo. Can your portfolio handle wall streets twists and turns . Ill see about that when we play am i diversified . Stick with cramer the cold stocks they seem to be mounting a selfcomeback alleluia take a look at the action in the oncebeloved tesla this week. Heres a stock thats endured some hard selling. Sell sell sell sell ever since that miz yeeshlserable last quarter, and yet it hangs in there. Hung in this 200 level like a champ it rallied on tuesday and wednesday as the market suffered heavy reversals both days. Its holding up despite multiple earnings guidedown and downgrades and an overall impression that the growth is completely stalled. How many stocks can withstand numbers like ten cars sold a month in china, when the company was hoping that at least 30 of the cars would be sold there and yet still be hanging in . Teslas resilience after these hideous numbers, im calling it staggering. Now, im not changing my view on this, no, not one bit. Great car, but i dont want to own the stock. Thats not to say i dont want you to own the stock. You can do whatever you want but buyers could care less about the numbers. Im not listening im not listening. Yeah, you know who they are. Theyre xheegle, my friend and thats the definition of a cult. And theyre in there on every gip. The sellers seem exhausted. None of the strusional shareholders are breaking ranks with the vision or execution. Vision. I think that until we get a fully 100 batterypowered car with similar long drive characteristics from a major manufacturer that cuts tesla on price, this stock will continue to have adherence and believe that every decline is a gift a gift to buy more. Thats the call of the buyer. It wont end until a major out your maker produces a car that will go 300 miles on one charge and go from 0 to 60 in four seconds with a 40,000 price tag. No one else is even near it yet. How about amazon . The action this ultracultish stock has been great of late rallying today to come within striking distance of one of its highs of all time. I was rather surprised that a major brokerage houses big price target bump yesterday didnt take the stock over 400 bucks. However, i think amazons had a remarkable run and even if its just marking time at these levels, i call that a big deal. The cult lives. Pollsters believe that when we see the results of the web service broken out, well recognize that this division can one day be a moneymaker. Netflix hangs in there, too, pulling back just 2 bucks, and i believe that it like amazon is just resting here in preparation for its next big move up not down. Netflix, like tesla and amazon is so beloved, so beloved that on any fundamental basis, youd be tempted to sell it into this amazing exuberance, but at 28 billion in market capitalization, is it really that irrational especially consideration abbvie just paid 21 billion for a company thats one oneseventh of netflix revenues . What would remmy do with it . The only honest guy on house of cards. What would this company be valued if it came public today, in light of the prices were hearing, versus say air b b or uber, the ones that mad money friend mark cuban are kind of buzzing about, right . When you put it like that you have to admit that netflix seems cheap versus the comparisons. I dont consider facebook a cult stock because it has real earnings power. However, it carries the taint of cult both because it bought whatsapp for 19 billion and because people believe that huge secondary offerings must be lurking out there somewhere. Still, facebooks pronounced breakout above 80 yesterday one that continued today with a 32cent gain seems very real to people. I think people are taking notice of the fact that facebook and another inexpensive internet stock, google are acting better. And therefore have a chance to break out on no real news. Thats the best kind of run if youre feeling cultish, because it encourages the cultist to play the momentum Breakout Game they love so much. Finally, welcome back to mobile eye, up a buck yesterday, another 2. 21 today. Ali baba up nearly 4 high yesterday, going higher. And gopro, which rallied nearly 3 bucks yesterday, even though it gave back most of the gains today. I think gopro has peaked. I like semiconductors better than mobile. And ali baba its only cheap if the Chinese Communist party says its to be cheap. Heres the bottom line, those are some hefty valuations, but you know whats really remarkable . Even after this monumental run in the porter averages there simply arent that many cult stocks out there. And for the most part theyre the same cult names weve been coping with for years now. Weve dealt with them before and we can deal with them again. Maybe thats all there is to it. Why dont we go to doug in missouri . Doug. Caller jim, just over a year ago, i watched your program when you had on the ceo of viva systems. I bought the stock back then and im a longterm investor and holder, but with the stock down 25 these last two days im wondering what to do. Yeah well people hate this stock. It doesnt matter. I looked at the quarter, i thought it was fine. Its just a hated stock. Its a heavily shorted, heavily hated stock. And i have to tell you, im sure someone out there think its just being manipulated. I dont know about it but you know what i tried to back this for a long time and i got warned down. There are other better plays. Im going to direct you to salesforce. Com, which has also come in. But viva . No its a shotdown stock constantly and it doesnt matter how good it is. Theyre not taking it higher. Ken in california. Ken caller in l. A. Here. Nice. Caller id like your recommendation on ebay for the next quarter. I know its seven weeks away but a spinoff [ inaudible ] their acquisition i think ebays good. I think ebays good. I think splits going to be good. I think paypals good. I tweeted something, a negative someone from the speed desk or thestreet. Com alerted me to a slate article about one of the divisions that i found worrisome. This was a person who decided he didnt want to be involved with paypal, but i think paypal is good and you get them separated, put money behind them and you get a new payroll, a new company thats involved with technology of pay and thats a very hot area. How about we go to ed in my home state of new jersey . Ed . Caller good afternoon, sir. Its a pleasure to meet you. Same. Caller jim im a retiree of verizon, okay and im accumulating stock. I dont know why the marketplace isnt giving them more respect, okay . Theyve got a dividend 4. 4, earnings per share 242 price earnings at 22. 03 and a billion in capitalization. And today, cnbc is dissing them telling them all their business going to comcast. I dont get it. Look, this is just a price war, sir. Its a price war. I mean youve got that guy, ledger throwing bombs, right . You know the guy with the pink shirt, hes throwing bombs. Youve got this guy, sprint that have got real deep pockets, just bought 5 million shares. Youve got at t out there saying were not going to lose any more ground and you have verizon. Theyre best in show and has a great yield. I wouldnt back away from it but except the fact that a price war is not something people like to be involved in. People like collusion in price, collusion with little brackets there because no one really coludz, do they . All right, cold stocks are making a comeback but theyre the same ones weve been dealing with all along and its dealable. Dont freak out. More ahead, including my exclusive with the ceo of dealetrack. Can they burn up wall street in im looking under the hood. Then, think your portfolio has what it takes to stay hot in any weather . Let me be the judge of that when we play am i diversified . Youre not going to let that get in the way of your calls, are you . Youre at home a redhot lightning round is coming up ahead. At mfs, we believe in the power of active management. Every day, our teams collaborate around the world to actively uncover, discuss and debate investment opportunities. Which leads to better decisions for our clients. Its a uniquely collaborative approach you wont find anywhere else. Put our global active management expertise to work for you. Mfs. There is no expertise without collaboration. Help join a continent with nearly 3 million rugged square miles with a single broadband connection. When emerson takes up the challenge its never been done before simply becomes consider it solved. Emerson. A couple days ago, we got some february auto Sales Numbers that were not so hot, to say the least. General motors doing really well out of the whole group. Maybe thats just because of the hideously cold weather thats kept people indoors and they might otherwise have been out car shopping but we cant afford to totally dismiss the possibility that maybe somethings truly amiss here. Thats why tonight i want to check in with dealertrack, home gamers a company that provides Car Dealerships with the most comprehensive suite of Software Solutions in the industry including platforms for sales, advance, digital retailing and dealer management solutions, which is Industry Speak for total Management Systems designed to improve a dealers efficiency while giving them realtime analytics. On top of that dealertrack has a Lending Network that helps finance 45 of all cars financed in the u. S. While also providing title and lien services. Although last week they delivered inline earnings and betterthanexpected sales, a lot of investors were disappointed by the fullyear Earnings Guidance for 2015. Management said its under pressure from integration costs related to a recent acquisition of ncadia a software in car dealership. In response, stocks got slammed fell 8. 7 the next day to 40 bucks and change. Hasnt bounced since. Is this merely a speed bump or something more serious . Mark oneil is chairman and ceo of dealertrack technologies. Well find out more about the company and overall industry. Mr. Oneil, welcome back to mad money. Thank you, jim. Nice to be back. Mark, first, i was talking to phil lebeau, our Auto Industry reporter and february was punk. It just wasnt that good. Are you seeing this as being a blip . Are you actually seeing it happen and maybe the numbers dont reflect it . And is it something we should worry about . Let me start with no its nothing we should worry about. So, we did an analysis of all 50 states. We looked at the 18 states that were impacted by weather and compared their volumes to the nonimpacted states and our conclusion was unequivocally its a weatherdriven event. While it came in at 16. 2 million, we were hoping for 17 million, we think we recover that volume between march and april and maybe if boston doesnt get out of the 6foot snow drifts, maybe their volume will go into may. But clearly, our Analysis Shows this is a blip. All right, terrific. Now, wells fargo, a bank i really like recently has tried to pull back from subprime lending. You are involved and see so much of auto lending. Is this something that could slow down sales in 2015 . We dont see it. In fact if you dig deep into what wells fargo really said is theyre going to cap the amount of subprime lending they do. And if you look at that cap relative to the volumes theyre doing right now, theyre really quite in line. So it would only be if car sales grew materially beyond 17 million and subprime increased as a significant percent that wed have any worries. But putting that in context, on the dealertrack network, there are over 1,600 lenders doing lending. So, if one lender decides to not be as aggressive in a segment, ill tell you, its a very competitive market now. We would expect other lenders to jump right in there. A lot of people write these articles and just say this is the next ticking time bomb. Look, youre deeply involved in it. I personally think that the credit picture of the American Consumers so good its another a ticking time bomb but i respect people who say theres a bubble. Is there indeed a bubble in auto lending . Unequivocally from dealertracks perspective, there is not a bubble in auto lending. There are more subprime loans out there today than there were five years ago, but thats because were selling 4 or 5 million more cars. And oh by the way, 35 to 40 of our population happens to have a Credit Rating that puts them in the subprime category but were selling more cars. If you look at the performance of the loan portfolios theyre performing terrifically. We just do not see the bubble that is being talked about here. You made the acquisition. It seemed to confuse people. But i think that if you want to get that next level of growth you have to make that kind of acquisition. Is there something you would do over on the Conference Call or something . Because to me somehow, it got muddled. And yet, if youre going to have the growth that i want to see from dealertrack, you need to make that acquisition. Excellent point, jim. So, let me make a couple comments here. One is dealertracks core business is growing over 15 a year compounded and thats organic growth. Oh, by the way, last year we grew 26 organically. So, now, were a larger company, a larger base. We continue to expect to grow significantly on an organic basis. As i said 15 plus. As were looking to 15, if i look at incadea, there are three reasons we did that acquisition. One was longterm growth. They will do 55 million in revenue this year but by 2020 we think that business does between 200 and 250 million in u. S. Dollar revenue equivalent. If you put that into context, thats 100 to 200 basis points of growth that will drive relative to the total dealertrack revenue, so it gives us excellent longterm revenue growth, it strengthens our oem relationships. There are only two Companies Globally where an oem can do onestop shopping for auto retail technology. Were one of those two. And oh, by the way, this acquisition gives us the only platform thats in all 82 countries with a Single Technology platform making us more nimble faster to market than anyone else. And third, it gives us a platform to take some of our u. S. , our Digital Marketing solutions, and bring those internationally. And while i dont think well do that in 2015 it certainly sets us up to do that in 2016 forward. And i think on the call, i dont think we conveyed the Growth Potential of this company. People got messed up with converting from ifrs to gaap and i think that was a lot of noise. I totally agree with you because i like the acquisition. One last question. This tesla model, i think teslas stalled, but when you say that people get all over you and say its not true. But the tesla nondealership model, is that something that if you look five years in the future more and more are going to go like that or is that really just unto itself . Thats unto itself. In fact i had the opportunities to listen to elan musk speak recently. He even suggested that their model in three to five years might include dealership distribution. You need the dealership for servicing the car. You really need it for touching and engaging with the consumer. We think its a hybrid model going forward. Theres a lot of Online Activity that happens, but also theres a very relevant position for the physical store to be part of the process. Excellent. Well, mark i think youve really straightened it out. I thought the acquisition was good. I dont know sometimes you just get bargains because people dont get it. Mark oneil, chairman and ceo of dealertrack. Great to speak with you, sir. Thanks, jim. Nice to speak with you. I felt great that he confirmed the weather. Hes done the actual work, so that blip down i was worried about in autos i feel much better after speaking to him. Mad moneys back after the break. Incadea pharmaceutical pharmacyclics and regeneron has made me a lot of money in my roth i. R. A. And i just thank you so much. A regular guy like me can do it. Im young and i did it im living proof. Thank you so much. Booyah, baby we are both regular guys and those are regular stories that i worked on for many many years to develop, including regeneron, which is the first ceo we ever had on this show. A big week for cramerica is indeed right around the corner. Starting monday, well have some of the best and brightest names in american industry. I cannot believe this list. Joining us to celebrate for mmx i even have my own little special bull thats ten years of bringing wall street to main street and helping you make some sense of the market. But yes, entertain i admit that. Since this is the most interactive show on television, i want to hear your story. What does mad money mean to you . Why dont you send me a video . Well share it with the world right here on the show. That video made me so happy. Ive been a little depressed of late. I think its weatherrelated. Just go to madmoney. Cnbc. Com and click on the link at the top of the page. Make sure you have your phone turned horizontally, okay . And that youre not on private browsing, not that i have any idea what that means. Tune in all next week for the big weeklong celebration and now, it is time for the lightning round crime cramericas like what the heck is that . Callers have a question ahead of time theyre all done on the fly. And then the lightning rounds over. [ buzzer ] are you ready, skeedaddy . It is time for the lightning round and i am starting with jake. Not from state farm from arizona. Jake caller hey, jim. Booyah. Booyah caller what are your thoughts on the stock etrl control Forward Corporation and do you think its a buy or sell . No no software for home entertainment. Its like, no man. Its hard enough to beat salesforce. Com. I dont want to control four. Loretta, could be my makeup person, in california. Loretta caller hi, jim. Id like your opinion on zyofarm farm. I think we missed this. Its gone too far. Im sorry. Dave in florida, dave . Caller jim booyah booyah. Dave, whos in a nicer place than i am whats happening . Caller its come down a bit, but buy, hold or sell stratasys . Im not going there because hewlettpackards going to split in two and one of thems going to have 3d printing and i dont want to be involved in another one. I particularly dont like 3d. John in michigan. John. Caller hi jim. I really love your show. I was just wondering if you had an opinion on Caesars Entertainment . Oh, i certainly do, and the opinion could be encapsulated in three words sell sell sell and that ladies and gentlemen, is the conclusion of the lightning round announcer the lightning round is sponsored by td ameritrade. So, how do you feel about cash back . I would not say im into it. But lets see where this goes. [ buzzer ] do you like to travel . Im all about free travel, babe. Thats what i do. [ buzzer ] balance transfers you up for that . Well unh. Too soon . [ female announcer ] fortunately, theres an easier way, with creditcards. Com. Compare hundreds of cards from every major bank and find the one thats right for you. Creditcards. Com. Its simple. Search, compare, and apply. [ ice rattles ] cramerica earlier we talked about management, how great leaders can make a difference. I want you to be the leader of your portfolio. What better way to do that than to be creating a perfectly diversified portfolio that cant be harmed by the markets daily gyrations. Lets play am i diversified . You call me and tell me your top five holdings. I tell you if youre diversified. Lets dig into some portfolios. Speaking of dig, ill be watching the premiere at 10 00 p. M. After i dug myself out of my snow so, its dig to dig. Lets start with a tweet from from cstress jimcramer my top five holdings. Am i diversified . Etp, roll not like j. Roll who is no longer with us. Hes now out west. Sbux and guy wire madtweets. Am i diversified . Sothebys, we know thats going to call that art. And then extermination. Energy transfer partners really got slammed as a pipeline company. Guideware guidewire, software company. Weve got art, exterminators and starbucks, which as we all know. So, there, its got it. Its got it. Its good its kind of odd. Never kind of a pastege, if not a mosaic of stock. Rod in georgia. Rod . Rod. Caller jim, hello from the sunny south. Hows it going . Caller oh, just wonderful. Actually, we saw the sun one day last week so its rain and snow, you know. I dont know the sun. Im new in this town. Thats an actual line from the three stooges. Thats said by larry, i think. Go ahead. Caller my stocks are bx hzo, mov, uri, isis. Am i diversified . Okay, lets take a look. Marine max boding. You know i prefer brunswick, but that stocks been good. Novato lets call it jewelry. Isis pharmaceuticals is one of my favorite. Both, i have to tell you on pipeline and on takeout. Blackstones a company ive been recommending private equity. Reynolds is the Construction Equipment rental company. Boding pharma and finance. Bingo alleluia ive got to go to my home state. Lets go to bob in new jersey. Bob . Caller hi, cramer, how are you doing . Not bad. How are you, bob . Caller oh, im kind of snowed in here. I cant believe it. A big booyah to you. You are the best thank you. Thank you very much. Caller thank you. Listen i have a few stocks and want to know if im diversified or not. Lets go. Caller okay exxonmobil chevron, General Electric Cisco Systems and mcdonalds. I think bob is from southern jersey. Someone the other day was saying i cant stand cramers philadelphia accent. I do not have one. Or when you have one, you cant tell you have one. So, you can say i have one, but i dont know it okay . All right, oil, uhoh, two oils. Well get rid of that one. Bristolmyers. A diversified conglomerate a restaurant and a really really Good Technology stock. Put bristolmyers in there, get rid of exxon and im a happy camper stick with cramer. Why are we so committed to keeping you connected . Why combine performance with a conscience . Why innovate for a future without accidents . Why do any of it . Why do all of it . Because if it matters to you its everything to us. The s60 sedan. From volvo. Lease the wellequipped volvo s60 today. Visit your local volvo showroom for details. Can it make a dentist appointment when my teeth are ready . Can it tell the doctor how long you have to wear this thing . Can it tell the Flight Attendant to please not wake me this time . The answer is yes, it can. So, the question your customers are really asking is can your business deliver . Over 20 million kids everyday in our country lack access to healthy food. For the first time American Kids are slated to live a shorter life span than their parents. Its a problem that we can turn around and change. Revolution foods is a company we started to provide access to healthy affordable, kidinspired chefcrafted food. We looked at what are the aspects of food that will help set up kids for success . Making sure foods are made with high Quality Ingredients and prepared fresh everyday. Our collaboration with citi has helped us really accelerate the expansion of our business in terms of how many communities we can serve. Working with citi has also helped to fuel our innovation process and the speed at which we can bring new products into the grocery stores. We are employing 1,000 people across 27 urban areas and today, serve over 1 million meals a week. Until every kid has built those lifelong eating habits, well keep working. Id like to say theres always a bull market somewhere. I promise to find it just for you right here on mad money. Im jim cramer. See you tomorrow narrator in this episode of american greed. Hey, everybody. James the cash king here. Narrator Investment Advisors james duncan and Hendrix Montecastro claim to have the tools to make investors rich. Were the 1 . Theyre the 99 . All the sheep go to bank of america. All the stallions come work with us. Narrator but the homepurchasing program they promote leaves investors on the hook for more than 100 million of debt. That wasnt financial freedom. It was financial chaos. Narrator while clients face foreclosure and bankruptcy, this slicktongued duo burn through nearly 30 million of their money. Thats not bad