Transcripts For CNBC Mad Money 20150507 : vimarsana.com

Whole session unfold with the averages starting of course, but only finishing higher. The dow gaining 82 points. S p advancing, and nasdaq climbing 0. 53 . A terrific setup. A setup for the bulls. Thanks to five major positives. Oil, the dollar, excessive pessimism, Interest Rates and good earnings. All of them went the right way today. Buy buy buy. Lets take them one at a time. So you can understand what made us feel so much more sanguine. First, need oil to stop going up. Then ultimately plummeting two bucks. The rallying and the consistency of the move, the sheer viciousness has obliterated the positive stories that have been driving whole swathes of the market. When you get a huge increase in the price of oil, it amounts to the tax increase on twothirds of the american economy. And its consumer based. You Better Believe thats a gigantic buzz kill. From the lowest at 43 to the peak yesterday at 62 bucks and change, oil was up more than 42 . And if you look at it, it was like this. And if you go and look at the charts of any of the retailers of restaurants or airlines, youll notice it was like that. There was a peak in the stocks that coincided with the bottom in oil. The action has been all bad since then. So bad that it almost doesnt matter what these Companies Said in the Conference Calls or or what numbers they delivered. Dont me . Hit up the airlines, they have been acting like death. Until today. When they were coiled springs traveling dramatically higher. Relief rally, dont know yet. Check out the action in Fiesta Restaurant Group and sonic for the last couple weeks. Theyre both on the show tonight. These two Companies Reported remarkably lets say consistent quarters. Pretty good numbers. All right, not to shoot the lights out, but good. Dennys, darden jack in the box, yet they all look the same. Didnt matter what they said. You have a peak and then a bruising. Even though all we heard was relatively good things. Why didnt they rally . Why didnt even the best of them rally . Why werent they obliterated after relatively good reports . Because big Portfolio Managers are always trying to figure out if the earnings of a company are peaking. Thats a big game they play. And with each of these stocks their judgment was this has to be the last good quarter. That the good quarter is signalled to peak. The only restaurant stories that went up were international and activist. Like Dominos International and yum took off because of actavis. If you missed the quarter or guided negatively then you had a noodles on your hand. Or lesser you had, yes, a chipotle style implosion all because of the rally in oil not what the companies were saying. So a day like this, when oil went lower was a god send. A reason to cover your short positions in the airlines. Rest assured you know the correlation. Stop kicking about why jack in the box is well off the highs as so many of you do in jimcramer on twitter. I want has nothing to do with how well the company has been executing. This is perfect. It didnt suddenly back hack in the box. Its just that the consumer has less money and the presumption is youll spend less too. Its a reasonable assumption. Oil hurt disney. Thats right. Think about it. Disney reported one of the best quarters ever and its down ever since. You have to wonder if the big driver that is theme parks, boy, were those numbers strong, could still stay strong if gasoline goes higher. I say yes, absolutely. Because of some technological changes in some new rides but for the moment all im doing is describing how the price of oil drove the near term performance not of the companies, but of the stocks. Second, oh boy, we need the dollar to stay weaker. At least not get stronger for some time. Now that earnings season is through, we know that analysts and iner haves did not look through currency. They wont say, i wont let that phase me ill act as its constant. No, there were no free currency passes. We know if a companys sales or margins were hurt by the strong dollar the stock didnt go higher. It went lower. What made this really difficult though was that the money from Big International companies have been rotating in and you saw that happen, that was shut off by the rally in oil as well as the Inflation Fears that stem from Higher Commodity Prices and wage gains. Almost every commodity has rallied from the lows. Ise making us its making us nervous about raw cost in inflation. We had to take back some of the gains from the consumer packaged goods. We were thinking gasoline oil, plastic comes down. Gross margin go higher, that may not be right. Plus the International Companies were making major concessions to keep business from going to competitors overseas. We werent competitive. Today, the green beck didnt do nothing, hoping we can see the end of the dollar thats weighed so heavily on the stock. The bad news has made people really pessimistic. Man, is it ever, a wall of pez him. We almost expected stocks to go down. Its a rare occasion they go higher. The charts, theyre almost uni formally horrible. You know they look terrible. The fear that we have seen in the last good quarters from the whole host of sectors is becoming green. When i woke up at 4 00 a. M. , we saw the german bonds get hammered again because business is coming back strong in europe. You know what though were so negative we dont think, wow, how terrific, europe is rebounding. We think, wow, owners of bonds getting hurt turmoil, pain more selling. Just as i abhor big openings i like it when the market is looking down on the open. If you have your Shopping List you can buy when others are panicking. Years ago, Warren Buffett no, it was monday, Warren Buffett aforimism aforimism, you want to buy the stocks that you like. The pessimistic icing on the cake, yesterdays comments from janet yellen. The stocks were overvalued. Doesnt matter she was wrong before. She took the bull and shot it with a bolt to the head. Yet thats the pech perfect environment for the well spring of a rally. You need that negativity. You need to you need the skittish people to get washed out. So stocks can be put in firmer hands. Then Interest Rates. They can go up pretty much every day. But i dont talk about it enough on the show. I get the feeling theyre going to overrun all the stocks with a juicy dividends as thats what tends to happen when Interest Rates ramp. Today though rates went down. And while maybe just a brief bond respite, it changed the landscape for the better. And you may have been disappointed by the same store sales from whole foods, and surprised that tesla didnt explode 20 or 30 points except that what happens to cold stocks. You could have been perturbed by the number from keurig green mountain. And the Conference Call was worse, that was terrible. You want to own that stock and monster through the shareholder that is cocacola. But we also had some huge upside surprises today. None bigger than alibaba which reminded us it can go higher. Just as significant maybe more so for those who follow tech, the amazing quarter from corvo. Corvo is a semiconductor company. Tell us on and why you didnt call yourself trimf or something. It provides key components to the cell phone industry and the read through was simple. The industry including the key customer apple is alive and doing fabulously, that was a fabulous Conference Call. Real good news for semis, so the glaring declines in skyworks solutions, eva ga, semi the other big three and high flying Tableau Software data delivered a terrific quarter. As i said on friday, that might spur another rally in the pricey mob thats mobile social internet of all things. So far, every day like this in 2015 has been pretty much a oneday wonder. With everything positive getting reversed the next session. Okay. We have to prepare for just that as we have that huge employment number tomorrow at 8 30 in the morning. But let me give you the bottom line. You know what, today you know what we discovered today . If you get lower oil, a dollar that doesnt do anything, positive earnings on top of a slew of pessimism, guess what . The market will lap it up. It loves lower rates. It loves lower gasoline. It loves a group of things that give you a recipe for rejuvenated stock market. Its a rarity, but its no longer impossible. It happened once so maybe it can happen again. Renado in pennsylvania. Caller jim big bad booyah to ya. Jim, i have been reading a lot about the drought in california. And i know Lockheed Martin is, working on desalinateing the ocean water. Look, Lockheed Martin along with General Dynamics and Northrop Grumman are my favorites. I like harris too. And orable. But you like Lockheed Martin because youre hoping for overseas orders because were not spending on defense like we used to. But Lockheed Martin is more of a play on the international desire to defend your country. Since were not going to do it for you anymore. Ray in florida. Ray . Caller hey, jim, thanks for taking my call. No problem, ray. Caller i noticed yesterday that the bank of america stock fell after the annual meeting. Whats your opinion on that stock . I talk to stephanie link remember we used to do a lot of stuff with action alerts. We are saying when is this one going to take off . It is an inexpensive stock. Thats what i say, its inexpensive. However, there are other banks i like more. Notably wells fargo. Which we own in my charitable trust. The bulls finally had it made for them today. But unfortunately they may go back in hiding again tomorrow. Be prepared. On mad money whats going on with sonic, the fast food player received up a hot quarter, but investors still passed on the stock. We have to talk to the ceo. Then things are looking up across the pond. I may have found the perfect way to play it. Ill reveal it just ahead. Plus is Fiesta Restaurant Group losing steam . The stock was en fuego last year, but it hasnt brought the heat in 2015. Ill see what see whats cooking with my interview with the ceo. Stay 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. For months restaurant stocks were the hottest group in the market because the price of oil was plummeting. This is one of the most direct beneficiaries of cheaper gasoline. And then they went radially out of favor. Take sonic across 44 states when sonic reported in late march they delivered some of the best numbers of the quarter. 11. 5 samestore sales space. But the management was conservative so instead of rallying, well, the stock got slammed and its been in the doghouse ever since. Puzzling. So now that the stock has pulled back is it time to do some buying . Sure the price of oil has rebounded but still below what it was a year ago. And as we know, sonic is a wellrun company. Terrific concept. And though its in 44 states its locations are much more highly concentrate in the south. Got a lot of room to expand. The stock has given us a fabulous 37 gain since we spoke to the ceo 11 month ago so lets dig deeper with cliff hudson the chairman and ceo of sonic who last month celebrated the 20th very of his taking the helm. Hes been at the chain for 30 years. Mr. Hudson welcome back to mad money. Thank you, jim. Its a pleasure to be with you. Well, its great to have you on. First, a surprising announcement today because it was not april fools day. Mcdonalds is fighting to reinvent itself. Kale. You had a kale announcement last year, didnt you . Well we had a kale announcement, but it was april fools day as a matter of fact. We said to folks try our kale shake on april fools day. So but in fact, we didnt follow through. We had fun with it. But nobody asked for it either. Right. Well, im trying to figure out, you guys are doing because the stock is down. All that i see that you guys have been doing exactly the statement thing you have been doing for years and years which is making big profits and the market rotated out of the restaurant stocks, not sonic, not doing the right thing. Right. Our business continues to be healthy. The things that are driving it are a differentiated product. Our guys are creative Great Service with differentiated food, made to order food. All the things continue on. They were great on the roll through the winter and they continue to be on the roll this spring. Its very much part of our dna. So our business is very healthy in spite of the stock moving around a little bit. One of the things that was interesting in one of your presentations, your day parts are radically different from any other. You have a huge afternoon business that nobody else has. Yeah. Almost a quarter of our business comes between 2 00 and 5 00, but we focus on breakfast, lunch, afternoon dinner and all five parts, that we call blade. We promote them separately. We have different products to align with them and we have different customers that use the day parts differently. So its a very important part of our strategy. Has been for oh, 15 to 20 years now. The other thing that you guys do that no one else has is this points of personalized service. People dont expect sonic to be at the forefront of technology when it comes to the customer but i think you are. Well, we will be implementing over the next several years so were implementing this now in addition to new point of sale service. The Technology Interface at the drivein stall with the average custer many. It will integrate with social media, our own app that the customer can utilize on or off premises for ordering and paying and integrates with social media off premises and on promises. While we have this now in only about 800 stores out of 3,500 in the system well roll it out through 2015, 2016, 2017. Im quite confident that that engagement with the customer on and off premises in a differentiated way will kind of mirror what we have our differentiated food made to order food and using the technology in the same sort of way. This is going to help drive traffic and drive loyalty over the next several years in a very sonic sort of way. All right. Well, i think that the case for the company and stock are clear. But the one thing that did confuse the analysts is the buy back, whether its done or going on hold. You have been one of the most aggressive buyers of your own stock. Im assuming that nothing has change and well get good news in 2016. Nothing has changed from that standpoint. We continue to buy back our own stock. We as a Franchise Company, we generate a lot of cash flow. And this is one of the good uses for it from our standpoint. Were very optimistic, very bullish about the business. We continue to buy back our own stock. Okay. Because i thought that the authorization was kind of done for 2015. 2016. Sounds like that youre in there. Yeah. Theres still a little bit left for this fiscal year. But well in the coming months talk about next year as well. But the fact is as the business generates the sales that it does and as a Franchise Company and a royalty stream and an ascending royalty rate well continue to buy back and the stocks will be part of our use of that cash. Well, were getting a real chance to buy sonic. I was surprised it went down so much. Cliff hudson, chairman and ceo of sonic. Congratulations on your 20th anniversary at the helm sir. Good to see you. Thank you. I appreciate it very much. Guys, look, i know it doesnt seem its the right time to buy it because gasoline is going higher. But this is down huge. This is a wellrun long term situation. I would buy some. Mad money is back after the break. Coming up losing steam . The stock behind taco cabana enjoyed a sizzling 2014. But the Fiesta Restaurant Group has struggled to stay spicy this year. Can it start turning up the heat again . Cramers checking out the menu with the ceo. Selle is sell sell. We can look at the stock and bond route around the world thats been happening till today. The one thats created more than 2 trillion losses in two weeks. And we can certainly run for cover. Or we can take a look at whats causing the route and find the winners the winners being made right now because of it. Its difficult to separate the emotions of the losses from the cold, hard precipitating facts and thats what you have to do if you want to be a good investor. Others are blaming the rise in the dollar or the vicious backup in the european rates or the feds raising the rates possibly because of inflation. What has really changed underneath it all . What is fundamentally different that ease caused the turmoil . I think europe is getting better. Im talking about spain, portugal, italy, france. All of the other countries by the craziness of greece. Thats happening because the European Central bankers created a situation like here. Remember when the fed got uber activist activist . You dont want to own anything other than growth vehicles. Yeah you wanted to buy anything else any other asset quality. Any other asset had greater value than their bonds. And they still do. Even if your bond yields have increased because they have only increased radically on a percentage basis. I would never buy a bond in europe right now. The moves by the central bank may have been unorthodox. But like it or not, theyre working. Dont hear enough about this. Europes gigantic economy 77 Million People its humming. When an economy improves many things occur. More people get put to work thats good. Sales increase good. Profits grow, good. Lending resumes, good. Bad debts go down, good. Tons of things that are good. Which brings me back to the original question about pick winners. When were buying stocks it should go higher because of the huge and positive sea change. Lets take a look at ppg. Run by ceo chuck bunch which is the biggest most lucrative Interest Rates<\/a> and good earnings. All of them went the right way today. Buy buy buy. Lets take them one at a time. So you can understand what made us feel so much more sanguine. First, need oil to stop going up. Then ultimately plummeting two bucks. The rallying and the consistency of the move, the sheer viciousness has obliterated the positive stories that have been driving whole swathes of the market. When you get a huge increase in the price of oil, it amounts to the tax increase on twothirds of the american economy. And its consumer based. You Better Believe<\/a> thats a gigantic buzz kill. From the lowest at 43 to the peak yesterday at 62 bucks and change, oil was up more than 42 . And if you look at it, it was like this. And if you go and look at the charts of any of the retailers of restaurants or airlines, youll notice it was like that. There was a peak in the stocks that coincided with the bottom in oil. The action has been all bad since then. So bad that it almost doesnt matter what these Companies Said<\/a> in the Conference Calls<\/a> or or what numbers they delivered. Dont me . Hit up the airlines, they have been acting like death. Until today. When they were coiled springs traveling dramatically higher. Relief rally, dont know yet. Check out the action in Fiesta Restaurant Group<\/a> and sonic for the last couple weeks. Theyre both on the show tonight. These two Companies Reported<\/a> remarkably lets say consistent quarters. Pretty good numbers. All right, not to shoot the lights out, but good. Dennys, darden jack in the box, yet they all look the same. Didnt matter what they said. You have a peak and then a bruising. Even though all we heard was relatively good things. Why didnt they rally . Why didnt even the best of them rally . Why werent they obliterated after relatively good reports . Because big Portfolio Managers<\/a> are always trying to figure out if the earnings of a company are peaking. Thats a big game they play. And with each of these stocks their judgment was this has to be the last good quarter. That the good quarter is signalled to peak. The only restaurant stories that went up were international and activist. Like Dominos International<\/a> and yum took off because of actavis. If you missed the quarter or guided negatively then you had a noodles on your hand. Or lesser you had, yes, a chipotle style implosion all because of the rally in oil not what the companies were saying. So a day like this, when oil went lower was a god send. A reason to cover your short positions in the airlines. Rest assured you know the correlation. Stop kicking about why jack in the box is well off the highs as so many of you do in jimcramer on twitter. I want has nothing to do with how well the company has been executing. This is perfect. It didnt suddenly back hack in the box. Its just that the consumer has less money and the presumption is youll spend less too. Its a reasonable assumption. Oil hurt disney. Thats right. Think about it. Disney reported one of the best quarters ever and its down ever since. You have to wonder if the big driver that is theme parks, boy, were those numbers strong, could still stay strong if gasoline goes higher. I say yes, absolutely. Because of some technological changes in some new rides but for the moment all im doing is describing how the price of oil drove the near term performance not of the companies, but of the stocks. Second, oh boy, we need the dollar to stay weaker. At least not get stronger for some time. Now that earnings season is through, we know that analysts and iner haves did not look through currency. They wont say, i wont let that phase me ill act as its constant. No, there were no free currency passes. We know if a companys sales or margins were hurt by the strong dollar the stock didnt go higher. It went lower. What made this really difficult though was that the money from Big International<\/a> companies have been rotating in and you saw that happen, that was shut off by the rally in oil as well as the Inflation Fears<\/a> that stem from Higher Commodity Prices<\/a> and wage gains. Almost every commodity has rallied from the lows. Ise making us its making us nervous about raw cost in inflation. We had to take back some of the gains from the consumer packaged goods. We were thinking gasoline oil, plastic comes down. Gross margin go higher, that may not be right. Plus the International Companies<\/a> were making major concessions to keep business from going to competitors overseas. We werent competitive. Today, the green beck didnt do nothing, hoping we can see the end of the dollar thats weighed so heavily on the stock. The bad news has made people really pessimistic. Man, is it ever, a wall of pez him. We almost expected stocks to go down. Its a rare occasion they go higher. The charts, theyre almost uni formally horrible. You know they look terrible. The fear that we have seen in the last good quarters from the whole host of sectors is becoming green. When i woke up at 4 00 a. M. , we saw the german bonds get hammered again because business is coming back strong in europe. You know what though were so negative we dont think, wow, how terrific, europe is rebounding. We think, wow, owners of bonds getting hurt turmoil, pain more selling. Just as i abhor big openings i like it when the market is looking down on the open. If you have your Shopping List<\/a> you can buy when others are panicking. Years ago, Warren Buffett<\/a> no, it was monday, Warren Buffett<\/a> aforimism aforimism, you want to buy the stocks that you like. The pessimistic icing on the cake, yesterdays comments from janet yellen. The stocks were overvalued. Doesnt matter she was wrong before. She took the bull and shot it with a bolt to the head. Yet thats the pech perfect environment for the well spring of a rally. You need that negativity. You need to you need the skittish people to get washed out. So stocks can be put in firmer hands. Then Interest Rates<\/a>. They can go up pretty much every day. But i dont talk about it enough on the show. I get the feeling theyre going to overrun all the stocks with a juicy dividends as thats what tends to happen when Interest Rates<\/a> ramp. Today though rates went down. And while maybe just a brief bond respite, it changed the landscape for the better. And you may have been disappointed by the same store sales from whole foods, and surprised that tesla didnt explode 20 or 30 points except that what happens to cold stocks. You could have been perturbed by the number from keurig green mountain. And the Conference Call<\/a> was worse, that was terrible. You want to own that stock and monster through the shareholder that is cocacola. But we also had some huge upside surprises today. None bigger than alibaba which reminded us it can go higher. Just as significant maybe more so for those who follow tech, the amazing quarter from corvo. Corvo is a semiconductor company. Tell us on and why you didnt call yourself trimf or something. It provides key components to the cell phone industry and the read through was simple. The industry including the key customer apple is alive and doing fabulously, that was a fabulous Conference Call<\/a>. Real good news for semis, so the glaring declines in skyworks solutions, eva ga, semi the other big three and high flying Tableau Software<\/a> data delivered a terrific quarter. As i said on friday, that might spur another rally in the pricey mob thats mobile social internet of all things. So far, every day like this in 2015 has been pretty much a oneday wonder. With everything positive getting reversed the next session. Okay. We have to prepare for just that as we have that huge employment number tomorrow at 8 30 in the morning. But let me give you the bottom line. You know what, today you know what we discovered today . If you get lower oil, a dollar that doesnt do anything, positive earnings on top of a slew of pessimism, guess what . The market will lap it up. It loves lower rates. It loves lower gasoline. It loves a group of things that give you a recipe for rejuvenated stock market. Its a rarity, but its no longer impossible. It happened once so maybe it can happen again. Renado in pennsylvania. Caller jim big bad booyah to ya. Jim, i have been reading a lot about the drought in california. And i know Lockheed Martin<\/a> is, working on desalinateing the ocean water. Look, Lockheed Martin<\/a> along with General Dynamics<\/a> and Northrop Grumman<\/a> are my favorites. I like harris too. And orable. But you like Lockheed Martin<\/a> because youre hoping for overseas orders because were not spending on defense like we used to. But Lockheed Martin<\/a> is more of a play on the international desire to defend your country. Since were not going to do it for you anymore. Ray in florida. Ray . Caller hey, jim, thanks for taking my call. No problem, ray. Caller i noticed yesterday that the bank of america stock fell after the annual meeting. Whats your opinion on that stock . I talk to stephanie link remember we used to do a lot of stuff with action alerts. We are saying when is this one going to take off . It is an inexpensive stock. Thats what i say, its inexpensive. However, there are other banks i like more. Notably wells fargo. Which we own in my charitable trust. The bulls finally had it made for them today. But unfortunately they may go back in hiding again tomorrow. Be prepared. On mad money whats going on with sonic, the fast food player received up a hot quarter, but investors still passed on the stock. We have to talk to the ceo. Then things are looking up across the pond. I may have found the perfect way to play it. Ill reveal it just ahead. Plus is Fiesta Restaurant Group<\/a> losing steam . The stock was en fuego last year, but it hasnt brought the heat in 2015. Ill see what see whats cooking with my interview with the ceo. Stay 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. For months restaurant stocks were the hottest group in the market because the price of oil was plummeting. This is one of the most direct beneficiaries of cheaper gasoline. And then they went radially out of favor. Take sonic across 44 states when sonic reported in late march they delivered some of the best numbers of the quarter. 11. 5 samestore sales space. But the management was conservative so instead of rallying, well, the stock got slammed and its been in the doghouse ever since. Puzzling. So now that the stock has pulled back is it time to do some buying . Sure the price of oil has rebounded but still below what it was a year ago. And as we know, sonic is a wellrun company. Terrific concept. And though its in 44 states its locations are much more highly concentrate in the south. Got a lot of room to expand. The stock has given us a fabulous 37 gain since we spoke to the ceo 11 month ago so lets dig deeper with cliff hudson the chairman and ceo of sonic who last month celebrated the 20th very of his taking the helm. Hes been at the chain for 30 years. Mr. Hudson welcome back to mad money. Thank you, jim. Its a pleasure to be with you. Well, its great to have you on. First, a surprising announcement today because it was not april fools day. Mcdonalds is fighting to reinvent itself. Kale. You had a kale announcement last year, didnt you . Well we had a kale announcement, but it was april fools day as a matter of fact. We said to folks try our kale shake on april fools day. So but in fact, we didnt follow through. We had fun with it. But nobody asked for it either. Right. Well, im trying to figure out, you guys are doing because the stock is down. All that i see that you guys have been doing exactly the statement thing you have been doing for years and years which is making big profits and the market rotated out of the restaurant stocks, not sonic, not doing the right thing. Right. Our business continues to be healthy. The things that are driving it are a differentiated product. Our guys are creative Great Service<\/a> with differentiated food, made to order food. All the things continue on. They were great on the roll through the winter and they continue to be on the roll this spring. Its very much part of our dna. So our business is very healthy in spite of the stock moving around a little bit. One of the things that was interesting in one of your presentations, your day parts are radically different from any other. You have a huge afternoon business that nobody else has. Yeah. Almost a quarter of our business comes between 2 00 and 5 00, but we focus on breakfast, lunch, afternoon dinner and all five parts, that we call blade. We promote them separately. We have different products to align with them and we have different customers that use the day parts differently. So its a very important part of our strategy. Has been for oh, 15 to 20 years now. The other thing that you guys do that no one else has is this points of personalized service. People dont expect sonic to be at the forefront of technology when it comes to the customer but i think you are. Well, we will be implementing over the next several years so were implementing this now in addition to new point of sale service. The Technology Interface<\/a> at the drivein stall with the average custer many. It will integrate with social media, our own app that the customer can utilize on or off premises for ordering and paying and integrates with social media off premises and on promises. While we have this now in only about 800 stores out of 3,500 in the system well roll it out through 2015, 2016, 2017. Im quite confident that that engagement with the customer on and off premises in a differentiated way will kind of mirror what we have our differentiated food made to order food and using the technology in the same sort of way. This is going to help drive traffic and drive loyalty over the next several years in a very sonic sort of way. All right. Well, i think that the case for the company and stock are clear. But the one thing that did confuse the analysts is the buy back, whether its done or going on hold. You have been one of the most aggressive buyers of your own stock. Im assuming that nothing has change and well get good news in 2016. Nothing has changed from that standpoint. We continue to buy back our own stock. We as a Franchise Company<\/a>, we generate a lot of cash flow. And this is one of the good uses for it from our standpoint. Were very optimistic, very bullish about the business. We continue to buy back our own stock. Okay. Because i thought that the authorization was kind of done for 2015. 2016. Sounds like that youre in there. Yeah. Theres still a little bit left for this fiscal year. But well in the coming months talk about next year as well. But the fact is as the business generates the sales that it does and as a Franchise Company<\/a> and a royalty stream and an ascending royalty rate well continue to buy back and the stocks will be part of our use of that cash. Well, were getting a real chance to buy sonic. I was surprised it went down so much. Cliff hudson, chairman and ceo of sonic. Congratulations on your 20th anniversary at the helm sir. Good to see you. Thank you. I appreciate it very much. Guys, look, i know it doesnt seem its the right time to buy it because gasoline is going higher. But this is down huge. This is a wellrun long term situation. I would buy some. Mad money is back after the break. Coming up losing steam . The stock behind taco cabana enjoyed a sizzling 2014. But the Fiesta Restaurant Group<\/a> has struggled to stay spicy this year. Can it start turning up the heat again . Cramers checking out the menu with the ceo. Selle is sell sell. We can look at the stock and bond route around the world thats been happening till today. The one thats created more than 2 trillion losses in two weeks. And we can certainly run for cover. Or we can take a look at whats causing the route and find the winners the winners being made right now because of it. Its difficult to separate the emotions of the losses from the cold, hard precipitating facts and thats what you have to do if you want to be a good investor. Others are blaming the rise in the dollar or the vicious backup in the european rates or the feds raising the rates possibly because of inflation. What has really changed underneath it all . What is fundamentally different that ease caused the turmoil . I think europe is getting better. Im talking about spain, portugal, italy, france. All of the other countries by the craziness of greece. Thats happening because the European Central<\/a> bankers created a situation like here. Remember when the fed got uber activist activist . You dont want to own anything other than growth vehicles. Yeah you wanted to buy anything else any other asset quality. Any other asset had greater value than their bonds. And they still do. Even if your bond yields have increased because they have only increased radically on a percentage basis. I would never buy a bond in europe right now. The moves by the central bank may have been unorthodox. But like it or not, theyre working. Dont hear enough about this. Europes gigantic economy 77 Million People<\/a> its humming. When an economy improves many things occur. More people get put to work thats good. Sales increase good. Profits grow, good. Lending resumes, good. Bad debts go down, good. Tons of things that are good. Which brings me back to the original question about pick winners. When were buying stocks it should go higher because of the huge and positive sea change. Lets take a look at ppg. Run by ceo chuck bunch which is the biggest most lucrative Coatings Company<\/a> in the world. For boats, homes, cars, all sorts of paints. They reported a miserable quarter, sales increased only 1 year over year. Its down nearly 3 this year. Why the weakness . Because it does about a third of the business in europe. Thats why. Europe hasnt been that strong. Worse, ppg in a dogfight against european paint companies and the prices are too high relative to theirs because of the darn strong dollar. When it cashes in, the euros on what it does sell, mainly paint, bmw and mercedes, there are fewer dollars left over because the euro is so low. But consider the following things that have occurred. Europe has gotten much stronger versus the dollar. No one thought that would happen. The order books have gotten much, much fatter. Car sales are way up. And ppgs products are way more competitive versus the european counterparts. We havent seen that in the Companies Reporting<\/a> it. Ppgs last quarter had all the negatives none of the positives, be in six weeks a monumental swing has occurred. Ppg can show Earnings Growth<\/a> over the end of the year because of whats causing the recent turmoil now. What gets sold, what becomes the lose . The stock of ppg, why . Its one of the s p 500. Nonetheless, it will get too low versus all the positives i have outlined and then you have the buy it. Maybe that recognition is becoming to dawn on investors after the interview here. Thats why itted a advanced 3. 58 today. You should take advantage of it, not be repulsed by. The action in ppg until today and last nights interview is why investing is so hard though. But its why investing is worthwhile. When this smoke clears as it did today, ppg will be a much more profitable company. Its stock will draw money away from others that dont benefit from the great 2015 sea change that you and i know about. But will soon be evident for all to see. Lets go to rick in maryland. Rick . Caller hey, jim. I have a couple questions about u. P. S. And fedex. First, which one would you rather have Going Forward<\/a> . And if fedex is allowed to acquire t t will this get them a competitive advantage over u. P. S. . I think fedex is doing better than u. P. S. U. P. S. last quarter was good. I know i had said they better start doing good quarters because they had bad year over year holiday seasons. It was a good quarter so its cheaper than fedex. Fedex is actually saying positive things. I kind of like them both here. Honestly i do. Sure investing isnt easy but it can be worth it and a case in point is the company i talked to last night ppg. The smoke will clear. The company will be much more profitable and the stock will impress you. But will it be much higher . Much more mad money including the stock behind Pollo Tropical<\/a> and taco cabana, its losing steam, but could now be the time to chow down on the Fiesta Restaurant Group<\/a> . I have the ceo. Now i know the market is like a see saw, but one group of stocks has found a formula for success. Ill clue you in on the winners. Plus, a thunderous thursday edition of lightning round is just ahead. Stick with cramer christina she would een and her mother have always been close, so it was only natural that she started to her her daughter out wither this jewelry company. [container door opening] what makes it an suv is what you can get into it. [container door closing] what makes it an nx is what you can get out of it. Introducing the firstever lexus nx turbo and hybrid. Once you go beyond utility theres no going back. What do you when a red hot growth stock momentarily loses the mojo . The underlying companys growth looks like it may plateauing and then the shares get pounded. Thats a question Fiesta Restaurant Group<\/a>, thats the once hot now not so hot company of Pollo Tropical<\/a> and taco cabana. The former being a caribbean chain and the latterer issing latter serving mexican food. It went up to 69 in the peak but now its down 26 to 50. Mostly because in february they delivered a quarter that some people thought was less than perfect. When you dealering with a high flying stock thats an exultive valuation anything less than perfect can be dangerous. Maybe growth is slowing. And fiesta delivered a one cent earnings beat off the 38 cents basis. Some said it was weaker than expected revenue. Up 12. 7 year over year as well as the increase in samestore sales in Pollo Tropical<\/a> and once again, no guidance, so people didnt like it. Stock had plunged 15 in the week before though and the results were better than many people feared. Now, i dont know, we have to take a longer term view here. Fiesta is very much about new store growth, particularly at Pollo Tropical<\/a>. It has plans to open new ones and 20 store growth so the story of growth remains intact. Question is has it come down enough to buy . Lets check in with tim taft. The president and ceo of Fiesta Restaurant Group<\/a> to find out more about the company and where its headed. Welcome back to mad money. Thank you, jim. Okay, we have to solve this problem. To me there was no slow down. I think the expectations got so high that it really didnt matter what number you picked. Do you think im right . I think youre right. I think that, you know, one of the things that we have heard is that Pollo Tropical<\/a> and your transactions have slowed down a little bit and that was a cause for panic. But with edont agree with we dont agree with that. If youre a watcher of the stock, you saw it happen in 2013 for similar reasons. Lets go over it, because in the Conference Call<\/a> you mentioned that you felt that some of the stores had you said a little bit of pinch because of the Affordable Care<\/a> act. I would think your combination of stores is so strong you would not feel that level of pain. Well jim i think theres two i think thises going on. First of all, the three counties were talking about in dade broward and palm beach, those are the three highest volume restaurants in our system. And those three counties had 750,000 people sign up. So when you take if that was the state, it would have been third in the union. You have a lot of people signing up and a lot of people in the busiest areas trying to figure out how are we going to pay for it. We believe it was a momentary issue and that things will rebound. Now, how much of i have propounded this thesis and it did seem to play out when i looked at the stocks. How much do you think that all the restaurant groups sold down because gasoline bottomed . I think thats a big part of it. I think if you listen to all of the Earnings Releases<\/a> and look at all the results that the Restaurant Industry<\/a> by and large has been affected negatively. Now, lets talk about the third concept. Because i know its brought up several times in the Conference Call<\/a>. I think its important because youre a great operator, but you put up only two of them. Cabana grill, if its really good isnt it time to start putting up a lot of stores . I think it depends on what you want to achieve by it, jim. The first one that we enoed up we learned a lo we learned a lot. I know that you have covered the the whats going won taco cabana, but one of the greatest things thats coming out of cabana grill were learning how to build a less expensive taco cabana. Lowering the costs of entry into the market place and at the same time, really getting innovative with our food. So all of that learning that we have with cabana grill is going into taco cabana. I think that the opportunity for cabana grill is on tap but its a test. Pollo tropical had four or five or six iterations of itself. This is first out of the box. You cautioned us on, dont add stores for the sake of adding stores. Buffalo wild wings talked about chicken prices and how much it hurt them. You do a lot of chicken. Chicken under control for you . Chicken is under contract for the remainder of the year. I think theres still an opportunity if chicken goes down that we still have the opportunity to move some volume to another supplier. But were locked in to the pricing for the rest of the year. So i dont have to worry about bird flu or anything like that. That will be solved by the end of the year hopefully. I think one of the things that people have to understand the amount of birds affected relatively speaking as a percentage is a small amount of birds. Second, that that industry does a very, very good job of making sure that whatever happened that they can police that issue out of it. Okay. Last week we were in san francisco. We saw a lot of technology. One of the things that we saw that was kind of basic but is working is the postmates. I mean do you you seem you have stores in areas that i would work perfectly with postmates. Is that something worth considering . It is. I think the laundry list of things that we have right now is really we have got 10 or 15 things that might be in the queue before we head in that direction. I get a lot of questions jimcramer on twitter, something is wrong, something is wrong. Youre a restaurateur, you have been around. You totally understand it. This is just another kind of just a couple of month interlude in a longer term scheme right . Im urging people to stay patient. Jim, a very wise board member said to me recently, with respect to the p. E. Ratio that the shareholders dictate what the p and the Management Team<\/a> all they can do is earn the e. So what were doing right know, there is not a Single Initiative<\/a> over the last four years that we have not accomplished on time or ahead of time. And the results thus far are better than anybody really thought that we could achieve. This Management Team<\/a> has the head down, its grinding. Theres no panic here. This is our plan is being executed and were at that phase in our existence or evolution that what were doing right now is just making stacking them on top of each other. One quarter better than the one before. I think theres a kind of sense of on or off. Youre the old fiesta group or mcdonalds. Its harder to fix, isnt it . Well i think first of all, some people often overlook that we have two brands and one were very, very proud of whats going on with taco cabana which right now is the larger of the two. And people kind of lose track about how well taco cabana is doing. Pollo tropical one thing to keep in mind, we were high fiving ourselves that we were achieving sales and volumes never seen. Were exceeding those now. So its not necessarily a reason to be doom and gloom about this. Well, im glad that you put that there. I feel the same way. Periodically you get the rotations. We can talk to any number of restaurants and theyd say the exact same thing. I think youre on a very great define long term growth which is what you need. Tim taft president and ceo of Fiesta Restaurant Group<\/a>. Thank you for coming on the show. Guys theres nothing wrong. Fiesta restaurant is fine. Tank its time, but it will get back and then more so. Mad money is back after the break. Man you run a business. Could be any kind of business. And every day youve got important decisions to make, like hiring. Where are you gonna find those essential people you need . With ziprecruiter, its simple. We post your job to over 100 job boards with just a single click, so you can reach millions of qualified candidates. Then well give you the tools to help you manage, screen and rank your applicants all so you can find the right one. Try zip recruiter for free today. Announcer lightning round is sponsored by td ameritrade. It is time. It is time for the lightning round. You say the name of the stock. I dont know the calls or the name of the stock ahead of time. I tell you whether to buy or sell. When you hear this sound [ buzzer ] then the lightning round is over. Are you ready, skeedaddy . Time for the lightning round. Start with tommy in oklahoma. Caller hi, jim. Any comments on one oak after the Earnings Report<\/a> came out . Im not a big fan of oneok. If you want to be in this group be in either transfer partners enterprise or you want to be in Kinder Morgan<\/a> the cclass kind. C corps. Not in oneok. It doesnt have the growth i used to like. Lets go to cory in massachusetts. Caller jim, big booyah froms. Were making history. Im calling you on the apple watch. Hold it. Tim, tim, come in. Caller what do you think of Horizon Pharma<\/a> i like it. We know that they have a great business model. I think you can go up over time. This guy is building a lot of great wealth. I think hes a winner. Rodney in florida. Rodney . Caller hey, jim, thanks for taking my call. Of course. Caller what are your thoughts on no i dont want propane or fracking sand i dont want those. If you take a look, they had a move. This is when you should sell sell sell. Because i think that in the end, you dont want to be in the lets say the Service Business<\/a> other than if youre a big dog. Lets go to larry in florida, larry . Caller hi, i appreciate you taking my call. Theres a Lifestyle Community<\/a> developer in florida that came out with a secondary a couple of weeks ago it has a p. E. Of 12. Called wci community. I cant believe that company has made such a come back. Its really doing very, very well. I happen anyone mentions Home Building<\/a> i go lennar. Because i like best of breed. John in virginia, john . Caller jim, booyah. Wow. Caller i need some help with the transocean. Can you help me on that . Transocean is involved in deep water rigs the deep water market has not come back at all. So therefore, my help is to say that if it does go up at all sell sell sell. And that, ladies and gentlemen, is the conclusion of the lightning round. [ buzzer ] announcer the lightning round is sponsored by td ameritrade. Sup jj . Working hard . Working 24 7 on mobile trader, rated 1 trading app in the app store. It lets you trade stocks options, futures. Even advanced orders. And it offers more charts than a lot of the other competitors do in desktop. You work so late. I guess you dont see your family very much . I see them all the time. Did you finish your derivative pricing model, honey . For all the confidence you need. Td ameritrade. You got this. If you want to succeed in business, mistakes are a luxury you cant afford. Thats why i recommend fast reliable comcast Business Internet<\/a>. They know what businesses need. And theres a nomistake guarantee. If you dont like it, you have thirty days to call and get your money back. With comcast Business Internet<\/a> you literally cant mook a mistick. I meant to say that. Switch today and get the no mistake guarantee. Comcast business. Built for business. In this increasingly volatile roller coaster of market, it feels like everything that makes sense has been stood on its head some groups are pretty consistent winners. Despite the almost schizophrenic action over the last couple of months. Take the major chemical stocks. They have been strong outperformers, many with proven fundamentals. Were going off the charts to find out where the best names are headed with the help of bob lange, the founder and senior strategist at explosive. Net and behind the performing trifecta stocks newsletter. The chemical stocks headlined by dupont and perhaps ppg have the best charts out there. They have been outperforming of late and we see call option and its clear to lange that big money is flowing in the group. You know when they get annoyed and theyre accumulating the chemical stocks you get longer lasting terrific moves. Lets go through them to see what hes seeing. Hes start with dupont, dd which has been under fire from nelson pelts who wants the company to break itself up. To be fair or at least streamline itself, to be fair to the ceo ellen kohlman we need to look at the long term monthly chart here. When kohlman took over in january 1 of 2009, dupont was at multiyear lows. Whenever you caught a pull back between 20 say 11 or 12 those were terrific buying opportunities. Theyre one of the best buying stocks since the generational bottom. In march of 2009 right here the whole market bottomed and then, you know beaten them all. Well, not all of them but pretty much. Bob lange thinks the uptrend here is very much intact. Especially with pelts continuing to apply pressure on management to create value. You can see it better in the daily chart. Here we can see that the stock has pulled back since mid march. See that, a big decline. Although last we get rebounded, we rebounded hard from the support. Lange thinks its important when dupont was getting slammed the stock still held up. In the 200day moving average. Okay . Lange also notes that last weeks monster rally came after some heavy call buying which suggests to him that some big buyers are focused on dupont moving up sharply in a short period of time and if thats because pelts may end up on the board. The mac d, the momentum indicator to detect changes that gave you a classic buy signal right here. The black line crossed over the red one, okay . Thats very, very meaningful. And thats one of the reasons why the stock roared. Meanwhile, lang also thinks that the relative strength index another momentum indicator seems poised to break to the upside. Put it together and lange thinks its a buy here. I know people think its had too much of a move but theres nice upside. And next up we had the ceo on this week from dow chemical. We know that theyre taking steps to become more like dupont and ppg by spinning off the commodity business. So take a look another this chart. You can see that this stock broke out to the upside or high volume in late. This is a pretty definitive move and again in late april it had another surge. Lange points out that this stock has been making higher highs and higher lows. Thats textbook. Textbook example of what a technician wants to see on the healthy chart. The mac d indicator gave us a healthy look and then heavy call volume in dow chemical and people believe the stock is headed higher. Lange pointed out that the dow has finished a cup and handle formation. Thats where you get the ushaped formation, that happened in april and then the stock starts roaring which is where its been for the past couple of days. Its the favorite name to buy and there are some negative publicity about the ceo today and the stock did get hit, but he said its okay. Its at the right levels. We have another high Quality Chemical<\/a> company. That was one that people dont talk about, the best chart i have ever seen. Created from the merger with the european basil at the end of 2012. This is incredible. When it pulled back nearly 50 in 2011 that was a fantastic end point. Why does it matter . Because lionel basil has pulled back again although its been rebounding lately. Lange thinks you might want to buy when its 13 points off the low. He is saying that could be like that. Now, why dont we look at daily chart of line dell. Not only do they show great relative strength with the mac d, flashing a buy signal but its about to make what we havent seen much in 2015. A golden cross. Thats where the 50 day short term blue okay moves crosses over the longer term 200 day. And for chart watches its when of the most textbook bullish signs. This is about to cross. And thats going to be a big buy, so you see this stock pop when that happens. Now, it may have run up substantially in april. Lange said this is not finished. Thats what you will see, its because the cross is completed. Finally, ppg with the ceo chuck bunch on last night. I adore ppg both the company and the stock but according to lange this is actually the weakest of the chemical charts. You can see its got a whole different formation here. However, ppg says it another been tracing out a w pattern. Okay. And its mac d is making a bullish crossover but this is premature. But if this happens, then lange believes the stock can break out of the current triangle pattern, okay its a triangle pattern which is not good. That its been stuck in. He thinks it can rally back to the old highs of 2007. According to bob, the chemical stocks are in a terrific position. He likes dow, dupont and lionel basil and throw in ppg because its looking better. But lionel basil may be the best one of all. Stick with cramer. It took Tim Morehouse<\/a> years to master the perfect lunge. But only one attempt to master depositing checks at chase atms. Technology designed for you. So you can easily master the way you bank. 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<\/a> 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 . I like to say there always a bull mark somewhere. I promise to find it for you. Seem jim cramer. See you tomorrow. Narrator in this episode of american greed. Marc dreier. Highpowered lawyer. You can smell the money, and thats why the clients come here. Narrator . Bon vivant. When marc stepped into a party, marc was there to party. Narrator . Con man. You have a guy whos actually pretending to be other people. Narrator he steals more than 700 million from hedge funds. They were vast pots of money with billions and millions, you know, overflowing the sides. Narrator . Because thats where the money is. This was a man who had always felt deeply empowered, that this type of success was his birthright because he was so smart","publisher":{"@type":"Organization","name":"archive.org","logo":{"@type":"ImageObject","width":"800","height":"600","url":"\/\/ia802704.us.archive.org\/10\/items\/CNBC_20150507_220000_Mad_Money\/CNBC_20150507_220000_Mad_Money.thumbs\/CNBC_20150507_220000_Mad_Money_000001.jpg"}},"autauthor":{"@type":"Organization"},"author":{"sameAs":"archive.org","name":"archive.org"}}],"coverageEndTime":"20240621T12:35:10+00:00"}