Transcripts For CNBC Mad Money 20161102 : vimarsana.com

Fingernails. No, im not talking about Hillary Clinton versus donald trump, for heavens sake. Im talking about the Cleveland Indians versus the chicago cubs. Thats what matters tonight. I think that in many really bizarre ways, the world Series Finale feels a heck of a lot like todays market where the dow dipped 77 points, spiep declined 0. 65 . Nasdaq lost 0. 93 . Now, you know me, i care about the players for certain and the game is definitely vit russ. But when i think of cleveland versus chicago, im defaulting to a map of cramerica and the players that rule those two cities. In chicago, its walgreens, boots alliance, boeing, Archer Daniels midland, United Continental and all state. Cleveland, eaton, sherwinwilliams, parker hanifin, key corp. And cliffs natural resources. I have no idea who wins the big game tonight but i dont really care, not that i dont care about baseball. Mike schmidts my hero. Its that i like both the cups and the indians because theyre both underdogs like my teams from philly, so its very hard for me too choose. Sadly, though, its not hard to choose which city will win when it comes to the stocks. Chicago beats cleveland by a mile and im going to tell you why. Maybe youll learn something about stocks through this. Lets go head to head like a pitching duel. First, the two big dogs, the aces. Eaton versus walgreens. When the chicago based walgreens last reported it delivered a very strong number and manage the made it clear they felt regulators would let them by in. Even if rite aid deal falls through, walgreens will then do a gigantic buy bark. Kkr the private equity firm with a stake in walgreens announced its stilling its remaining shares to the public with another 2 million shares going to the companys ceo. A man who already owns 13 of the company. That will clear kkr out. Theyll no longer have a stake in it. It shows the level of commitment of walgreens thats about as strong as ive ever seen from a ceo. My Charitable Trust owns the stock. Weve advising club members of actionalertsplus. Com that wed buy if we were allowed. Against walgreens, all cleveland has to offer is eaton. Eight be sadly reported a disappointing quarter last night pretty much across the board with weaker orders, particularly in truck related businesses. The ceo said the indecision regarding the election softened demand, causing him to trim the companys forecast. It was a very heartfelt and down bet Conference Call quite frankly. Game one, chi town. Next up in our world series of stocks, weve got boeing versus sherwinwilliams. When boeing reported last week it traced out a scenario of terrific orders, huge cash flow and a remark be book of business especially for narrow body planes but also for defense. Given all the recent hand wringing about how aerospace had got enweaker, i found it a total wake up call. This isnt isnt done. Its in full mode long term. Theres some softness in wide body aircraft. Hello. The stock has taken off although in the past few days its pulled back a bit. Let there be no doubt. There was indeed a dynamite quarter. Against boeing, clevelands got sherwinwilliams. Sherwin will yaps was shelled after it reported a week ago. Many people came in expecting a real good quarter, a cant miss even. Kind of like where the tribe was a couple games ago. Oh, well, was it really that bad . Yeah. The bleek report started a parade of weakness that even ended up darkening the hope depot and lows stories. Just so, so rough. This one was an easy call. Boeing went eight scoreless innings. Cleveland threw in the towel and Sherwin Williams called the bull pen by the fourth. How about game three . Archer daniels midland versus parker hanifin. Oh, this was supposed to be a battle royal, but it was very clear who people were favored. They are favoring parker hanifin. I heard people say it was a gimme. Gimme for cleveland because despite so many different struls struggling, they posted some good numbers especially in aerospace. Get this, for an industrial, it reaffirmed its forecast. Not many industrials have been able to do that. In fact, when parker announced its results it actually set off a mini rally in the industrials. Money was flying out and health care was looking for a home. By virtue of its solid process controlled sales, it looked like this was definitely going clevelands way. By the end of the first inning, it was a walk. Wrong. Out of nowhere, Archer Daniels midland, a former rubber arms serial disappointer in the agricultural space actually reported a surprise. Terrific ag services. The sweeteners were fantastic. I was astonished. This felt like clevelands game to win, this was a home game by the way. But then chicago delivered a huge upset, one that took the betters to the cleaners as archer zanl stock rallied more than three bucks in one session and then climbed again today. It the about ages since this thing gov off the schneid and suddenly its among the s ps big ef winners. Talk about rising to the occasion, Archer Daniels has a really sneaky changeup. Just when the talk was a chicago sweep, who goes to the mound . But beth mooney of clevelands key corp. Oh, shes got a mean curve. Versus oscar munoz, a recent trade to chicagos United Continental. I love oscar. Hes kind of like bo jackson. But mooney has delivered a level of play that no airline, including cramer fave United Continental. I expect a hike next month which will allow key corp. To insta instantly make a ton of money off your deposits. Hieblg or no hike, it doesnt matter, mooneys numbers this quarter were fabulous. Amazing that interest margin. Thats the era of course. At last cleveland gets a win, which brings us to the final tonights game. Actually its not much of a contest. At least in cramerica. Chicago didnt need seven games to win this world series. You see, tonight, well, actually last week, all state, the giant insurer reported solid top and bottom line numbers after the close. But you see it didnt matter because its up against cliffs natural. Thats what we could find from cleveland. Thats an iron ore and cole producer. Meanwhile, allstate is a huge winner in a higher Interest Rate environment because it can make more money off your premiums. The trophy goes to the championship star cubbies. Now, im now, im not ducking the facebook is down badly tonight. I can see that. Im not ducking it. Just because the giants arent in the series. In truth, i want to make my own judgment from listening to the call and not relaying on the tape like so many suckers. And im not dodging the election, but candidly arent you getting like a ton of that in other places. I think you dont necessarily need this guy opining every minute on it. Sometimes its okay to focus on the national pastime. So heres the bottom line. What does the series say about the overall stock market . I think it captures a lit of the zeitgeist of the moment. An Aerospace Company like boeing can still get you a win. Agriculture is coming back. Gets you right on base. And Regional Bank is a Solid Holding in a rising Interest Rate environment. Whats win in the series is winning in the market. I just wish there were more ws to go around. Janet in washington, janet. Caller hi, jim. Congratulations. Were almost to the end of the election, yay. Yes yes, we are caller yes. Im considering a bank stock because of the rise in Interest Rates. I am skeptical of the big banks because of their ethics. So is there a good Regional Bank like bbt or should i just stick with visa . Why dont we go with key . Bbt is good. Kelly king, very good. We just talked about beth mooney with key. She did a really good job, and i think theyve got the mojo, meaning theyve got really good long growth and good net interest margin. I say key is the one. Go tribe. Lets go to wes in maine, wes. Caller hey, jim, thanks for taking my call. How about some cubs in seven booyah, my friend . Partisan statement. Caller thanks for helping me out here. Ive got a position in t. Rowe price. Great company. Well run company. Well respected. Nice yield, 3. 4 or so. But the stocks been a lag ard over the last three, four years, just kind of going sideways. I wonder if thats, you know, a fundamental weakness in the Financial Services industry or is that more specific to t. Rowe price if. I think whats going on there, to be clear is that theyre considered to be active Fund Managers and penople dont want that right now. What they want is people are putting money in with outfits like black stone, okay . I mean blackrock, im sorry. Meaning they want what they want is pass if Money Managers and blackrock stock is a better buy. I prefer to be in, frankly if i want to be in a financial right now, i want to be in citi. Anyway, youve got my take. Yes, i know, facebook down huge. I should just be focusing about that. I should be focusing on the election. But, you know, sometimes you take a little break, and we root for im focused on finding some winners. Youve seen players like walgreens, boeing, Archer Daniels, key bank that rise to the championship stakes on mad money tonight. The oil hitting the lowest level since september. Im comparing the quarters of exxon and chevron, telling you how the two companies could have two vast lid different results. Then its been a busy time in splitsville as of late. Ive got one company thats spinning off on wall street that youve got to know more about. Im eyeing the upcoming break up. You probably have its products in your pantry right now, my exclusive with the ceo is just ahead. So 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. Were drowning in information. Where, in all of this, is the stuff that matters . The stakes are so high, your finances, your future. How do you solve this . You dont. You partner with a firm that advises governments and the fortune 500, and, can deliver insight person to person, on what matters to you. Morgan stanley. Weand sustainability goals asool one of our top priorities. Mental i definitely rely on pg e to be an energy advisor. Anything from rebates, to how can we be more efficient . Pg e has a number of programs, to help schools save on energy. When i see a program that fits them, then i bring it to them. With the help of pg e weve been able to save a tremendous amount of energy and a tremendous amount of money. Were able to take those savings and invest it right back into the classroom. Together, were building a better california. Last friday the unofficial energy portion of earnings season got started with a bang. When we heard from exxon mobil and chevron. I got to tell you, these two very Similar Companies could not have delivered a more different pair of results. Chevron posted a strong top line beat and trounced the earnings per share expectations whereas exxon missed badly on the top line even as it solidly beat the earnings numbers. Thats why chevron quickly rallied 4 on friday while exxon declined by almost 2. 5 . And it didnt stop there. This week the analysts community chimed in and they were much more bullish about chevrons prospects while being incrementally less positive. But youve got to wonder how is this even possible . How could chevron be doing so well at a time when exxons performance is, say, suboptimal . These are two of the Largest Energy companies in the s p 500, two integrated oil titans. The truth is that exxon and chevron have always been a little different. Exxon is more of a steady eddie story. Exxons also managed to stay profitable. Its dividend has never been called into question. The chevron has been all over the place. Their numbers are a little more volatile, actually a loit. In the four quarter of last year, they started reporting quarterly losses, and as chevrons profitability wanes, many starts woring about the sustainability of their dividend. Since then weve been assured about the dividend. The share price surged back to 105 as of today. Now, going into friday before either company reported, both stocks were up 11 yeartodate. So its not like one had run up massively and the other hadnt. How do we even explain these divergent results . First lets talk about the headline numbers. Chevron delivered a monster 31 cent earnings beat over a 37 cent basis, substantially higher than expected revenue. Exxon on the other hand gave us a much smaller five cent earnings beat off a 58 cent basis, but their revenues came in at 58 billion when wall street was looking for 63 billion dollars that. Is a gigantic miss. The other key metrics seem to be pretty similar. Chevron cut its Capital Expenditures by 35 , exxon by 45 . Chevrons overall production declined by 1 . Exxons by 2. 7 . The real difference, though, here, the thing that caused chevrons stock to rocket as exxons stock went lower was the commentary on the two Conference Calls. They were so bizarrely opposite. Chevrons management painted a more bullish picture. The ceo called out the Liquified Natural Gas and the payoff for all that investment is getting started. Beyond that, chevron talked at length about its presence in the permian basis in texas, which has become the hot place to drill and chevron has more than 2 million acres of land there. That is land is lucrative with oil even under 50. The exxon mobil Conference Call on the other hand, much more subdued. Management spent a long time talking about potential impairments to the companys improved reserves, which understandably spooked investors. I think they spent way too much talking about accounting standards, not enough time laying out a positive vision for the future. But to their credit, theyre never promotional, not in their nature. One of the most surprising reactions came from golden sachs analyst who upgraded to buy. While downgrading exxon from buy to neutral. Meta called chevron a super major at an inflex point and says its poised for some major volume growth thanked to its permian acreage and its holdings in kazakhstan. As numbers continue to improve, he expected chevron will get a higher. Plus meta thinks management will give us a positive update on its Permian Basin plans in march. At the same time, meta is a lot less optimistic about exxon. Quoting, lowering to neutral as limbed cat alift to drive shares higher. He thinks chevron is in a better position to great its production and its cash flow while exxon doesnt seem to be doing too much that can move the kneelnee. The reason chevron roared in response to its quarter while exxon got slammed is chevron has been doing a heck of a lot more to improve its position. At this moment, chevron seems like a better company. How about their stocks . Chevron trades at nearly 23 times next years estimates. If you go out to 2018, chevron is trading for just 16 times numb earnings. How. Dividends . Chevrons supports a 4. 1 yield. Exxon has got 3. 6 percent. I think this recent differential in performance could be just the beginning. Chevron appears to have a lot more upside. Exxon seems like its just sitting there. Heres the bottom line, though. Going into this quarter, we expected a boring, predictable quarter from exxon, but it instead made us worry about accounting issues that could harm the paper value of the reserves. Chevron on the other hand has been more of a wild card in recent quarters so when the company came out with some bullish commentary about its future, that caught a lot of people by surprise. Chevr a lot of upside Going Forward from overseas asset while exxon seems content to be the same old big integrated oil company. Ill take chevron over exxon any day of the week. Much more mad money. Snack packs, slim jims, from favorite snacks to healthy choices, Conagra Foods is bying some of americas big ef brands, but theres big news here you need to have on your radar screen. Then clorox has been cleaning up for more than a century. But after the companys earnings miss, has it created a mess . And four trends that have held up, ill reveal them all just ahead. This has been a busy moment for break jumps. First alcoa swins off as ar connick, then young brands spins off young china, which now gets more favorable treatment from the communist party. Weve got one more big corporate divorce coming up a week from now. Its conagra, the packaged food company. Separating its consumer packaged food business right here from its commercial food business for restaurants that will trade under the name of lam weston. Conagra announced this move a little less than a year ago and we have to figure out how to play the split. These are getting really difficult to play candidly. First let me give you some background on how all this came about. Conagra is one of the largest packaged Food Companies in the world. Hunts catchup, pam, slim jims, a. They also have a big commercial business selling food and ingredients to major restaurant chains. Now, before we can really talk about the breakup, its worth noting that conagra had a serious problem in recent years. In 2012, the company massively overpaid for a Company Called raul corp. Conagra was betting consumers weary of the Great Recession would continue buying cheaper store brand options at the supermarket even as the economy recovered. But by 20 15rks business was still in steady decline. It was this weakness that caused the investors of janna partners. They bought a 7. 2 stake in conagra and they began pushing management to sell the bright label business. Thankfully conagras management listened and announced it was getting out of the private label business. They ended up selling it to tree house foods for a lot less than they paid. It ended up being a good deal for everybody involved. A few weeks later, conagra told us it wasnt finished, it needed to transform even more. The Hillary Clinton<\/a> versus donald trump, for heavens sake. Im talking about the Cleveland Indians<\/a> versus the chicago cubs. Thats what matters tonight. I think that in many really bizarre ways, the world Series Finale<\/a> feels a heck of a lot like todays market where the dow dipped 77 points, spiep declined 0. 65 . Nasdaq lost 0. 93 . Now, you know me, i care about the players for certain and the game is definitely vit russ. But when i think of cleveland versus chicago, im defaulting to a map of cramerica and the players that rule those two cities. In chicago, its walgreens, boots alliance, boeing, Archer Daniels<\/a> midland, United Continental<\/a> and all state. Cleveland, eaton, sherwinwilliams, parker hanifin, key corp. And cliffs natural resources. I have no idea who wins the big game tonight but i dont really care, not that i dont care about baseball. Mike schmidts my hero. Its that i like both the cups and the indians because theyre both underdogs like my teams from philly, so its very hard for me too choose. Sadly, though, its not hard to choose which city will win when it comes to the stocks. Chicago beats cleveland by a mile and im going to tell you why. Maybe youll learn something about stocks through this. Lets go head to head like a pitching duel. First, the two big dogs, the aces. Eaton versus walgreens. When the chicago based walgreens last reported it delivered a very strong number and manage the made it clear they felt regulators would let them by in. Even if rite aid deal falls through, walgreens will then do a gigantic buy bark. Kkr the private equity firm with a stake in walgreens announced its stilling its remaining shares to the public with another 2 million shares going to the companys ceo. A man who already owns 13 of the company. That will clear kkr out. Theyll no longer have a stake in it. It shows the level of commitment of walgreens thats about as strong as ive ever seen from a ceo. My Charitable Trust<\/a> owns the stock. Weve advising club members of actionalertsplus. Com that wed buy if we were allowed. Against walgreens, all cleveland has to offer is eaton. Eight be sadly reported a disappointing quarter last night pretty much across the board with weaker orders, particularly in truck related businesses. The ceo said the indecision regarding the election softened demand, causing him to trim the companys forecast. It was a very heartfelt and down bet Conference Call<\/a> quite frankly. Game one, chi town. Next up in our world series of stocks, weve got boeing versus sherwinwilliams. When boeing reported last week it traced out a scenario of terrific orders, huge cash flow and a remark be book of business especially for narrow body planes but also for defense. Given all the recent hand wringing about how aerospace had got enweaker, i found it a total wake up call. This isnt isnt done. Its in full mode long term. Theres some softness in wide body aircraft. Hello. The stock has taken off although in the past few days its pulled back a bit. Let there be no doubt. There was indeed a dynamite quarter. Against boeing, clevelands got sherwinwilliams. Sherwin will yaps was shelled after it reported a week ago. Many people came in expecting a real good quarter, a cant miss even. Kind of like where the tribe was a couple games ago. Oh, well, was it really that bad . Yeah. The bleek report started a parade of weakness that even ended up darkening the hope depot and lows stories. Just so, so rough. This one was an easy call. Boeing went eight scoreless innings. Cleveland threw in the towel and Sherwin Williams<\/a> called the bull pen by the fourth. How about game three . Archer daniels midland versus parker hanifin. Oh, this was supposed to be a battle royal, but it was very clear who people were favored. They are favoring parker hanifin. I heard people say it was a gimme. Gimme for cleveland because despite so many different struls struggling, they posted some good numbers especially in aerospace. Get this, for an industrial, it reaffirmed its forecast. Not many industrials have been able to do that. In fact, when parker announced its results it actually set off a mini rally in the industrials. Money was flying out and health care was looking for a home. By virtue of its solid process controlled sales, it looked like this was definitely going clevelands way. By the end of the first inning, it was a walk. Wrong. Out of nowhere, Archer Daniels<\/a> midland, a former rubber arms serial disappointer in the agricultural space actually reported a surprise. Terrific ag services. The sweeteners were fantastic. I was astonished. This felt like clevelands game to win, this was a home game by the way. But then chicago delivered a huge upset, one that took the betters to the cleaners as archer zanl stock rallied more than three bucks in one session and then climbed again today. It the about ages since this thing gov off the schneid and suddenly its among the s ps big ef winners. Talk about rising to the occasion, Archer Daniels<\/a> has a really sneaky changeup. Just when the talk was a chicago sweep, who goes to the mound . But beth mooney of clevelands key corp. Oh, shes got a mean curve. Versus oscar munoz, a recent trade to chicagos United Continental<\/a>. I love oscar. Hes kind of like bo jackson. But mooney has delivered a level of play that no airline, including cramer fave United Continental<\/a>. I expect a hike next month which will allow key corp. To insta instantly make a ton of money off your deposits. Hieblg or no hike, it doesnt matter, mooneys numbers this quarter were fabulous. Amazing that interest margin. Thats the era of course. At last cleveland gets a win, which brings us to the final tonights game. Actually its not much of a contest. At least in cramerica. Chicago didnt need seven games to win this world series. You see, tonight, well, actually last week, all state, the giant insurer reported solid top and bottom line numbers after the close. But you see it didnt matter because its up against cliffs natural. Thats what we could find from cleveland. Thats an iron ore and cole producer. Meanwhile, allstate is a huge winner in a higher Interest Rate<\/a> environment because it can make more money off your premiums. The trophy goes to the championship star cubbies. Now, im now, im not ducking the facebook is down badly tonight. I can see that. Im not ducking it. Just because the giants arent in the series. In truth, i want to make my own judgment from listening to the call and not relaying on the tape like so many suckers. And im not dodging the election, but candidly arent you getting like a ton of that in other places. I think you dont necessarily need this guy opining every minute on it. Sometimes its okay to focus on the national pastime. So heres the bottom line. What does the series say about the overall stock market . I think it captures a lit of the zeitgeist of the moment. An Aerospace Company<\/a> like boeing can still get you a win. Agriculture is coming back. Gets you right on base. And Regional Bank<\/a> is a Solid Holding<\/a> in a rising Interest Rate<\/a> environment. Whats win in the series is winning in the market. I just wish there were more ws to go around. Janet in washington, janet. Caller hi, jim. Congratulations. Were almost to the end of the election, yay. Yes yes, we are caller yes. Im considering a bank stock because of the rise in Interest Rate<\/a>s. I am skeptical of the big banks because of their ethics. So is there a good Regional Bank<\/a> like bbt or should i just stick with visa . Why dont we go with key . Bbt is good. Kelly king, very good. We just talked about beth mooney with key. She did a really good job, and i think theyve got the mojo, meaning theyve got really good long growth and good net interest margin. I say key is the one. Go tribe. Lets go to wes in maine, wes. Caller hey, jim, thanks for taking my call. How about some cubs in seven booyah, my friend . Partisan statement. Caller thanks for helping me out here. Ive got a position in t. Rowe price. Great company. Well run company. Well respected. Nice yield, 3. 4 or so. But the stocks been a lag ard over the last three, four years, just kind of going sideways. I wonder if thats, you know, a fundamental weakness in the Financial Services<\/a> industry or is that more specific to t. Rowe price if. I think whats going on there, to be clear is that theyre considered to be active Fund Managers<\/a> and penople dont want that right now. What they want is people are putting money in with outfits like black stone, okay . I mean blackrock, im sorry. Meaning they want what they want is pass if Money Managers<\/a> and blackrock stock is a better buy. I prefer to be in, frankly if i want to be in a financial right now, i want to be in citi. Anyway, youve got my take. Yes, i know, facebook down huge. I should just be focusing about that. I should be focusing on the election. But, you know, sometimes you take a little break, and we root for im focused on finding some winners. Youve seen players like walgreens, boeing, Archer Daniels<\/a>, key bank that rise to the championship stakes on mad money tonight. The oil hitting the lowest level since september. Im comparing the quarters of exxon and chevron, telling you how the two companies could have two vast lid different results. Then its been a busy time in splitsville as of late. Ive got one company thats spinning off on wall street that youve got to know more about. Im eyeing the upcoming break up. You probably have its products in your pantry right now, my exclusive with the ceo is just ahead. So 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. Were drowning in information. Where, in all of this, is the stuff that matters . The stakes are so high, your finances, your future. How do you solve this . You dont. You partner with a firm that advises governments and the fortune 500, and, can deliver insight person to person, on what matters to you. Morgan stanley. Weand sustainability goals asool one of our top priorities. Mental i definitely rely on pg e to be an energy advisor. Anything from rebates, to how can we be more efficient . Pg e has a number of programs, to help schools save on energy. When i see a program that fits them, then i bring it to them. With the help of pg e weve been able to save a tremendous amount of energy and a tremendous amount of money. Were able to take those savings and invest it right back into the classroom. Together, were building a better california. Last friday the unofficial energy portion of earnings season got started with a bang. When we heard from exxon mobil and chevron. I got to tell you, these two very Similar Companies<\/a> could not have delivered a more different pair of results. Chevron posted a strong top line beat and trounced the earnings per share expectations whereas exxon missed badly on the top line even as it solidly beat the earnings numbers. Thats why chevron quickly rallied 4 on friday while exxon declined by almost 2. 5 . And it didnt stop there. This week the analysts community chimed in and they were much more bullish about chevrons prospects while being incrementally less positive. But youve got to wonder how is this even possible . How could chevron be doing so well at a time when exxons performance is, say, suboptimal . These are two of the Largest Energy<\/a> companies in the s p 500, two integrated oil titans. The truth is that exxon and chevron have always been a little different. Exxon is more of a steady eddie story. Exxons also managed to stay profitable. Its dividend has never been called into question. The chevron has been all over the place. Their numbers are a little more volatile, actually a loit. In the four quarter of last year, they started reporting quarterly losses, and as chevrons profitability wanes, many starts woring about the sustainability of their dividend. Since then weve been assured about the dividend. The share price surged back to 105 as of today. Now, going into friday before either company reported, both stocks were up 11 yeartodate. So its not like one had run up massively and the other hadnt. How do we even explain these divergent results . First lets talk about the headline numbers. Chevron delivered a monster 31 cent earnings beat over a 37 cent basis, substantially higher than expected revenue. Exxon on the other hand gave us a much smaller five cent earnings beat off a 58 cent basis, but their revenues came in at 58 billion when wall street was looking for 63 billion dollars that. Is a gigantic miss. The other key metrics seem to be pretty similar. Chevron cut its Capital Expenditures<\/a> by 35 , exxon by 45 . Chevrons overall production declined by 1 . Exxons by 2. 7 . The real difference, though, here, the thing that caused chevrons stock to rocket as exxons stock went lower was the commentary on the two Conference Call<\/a>s. They were so bizarrely opposite. Chevrons management painted a more bullish picture. The ceo called out the Liquified Natural Gas<\/a> and the payoff for all that investment is getting started. Beyond that, chevron talked at length about its presence in the permian basis in texas, which has become the hot place to drill and chevron has more than 2 million acres of land there. That is land is lucrative with oil even under 50. The exxon mobil Conference Call<\/a> on the other hand, much more subdued. Management spent a long time talking about potential impairments to the companys improved reserves, which understandably spooked investors. I think they spent way too much talking about accounting standards, not enough time laying out a positive vision for the future. But to their credit, theyre never promotional, not in their nature. One of the most surprising reactions came from golden sachs analyst who upgraded to buy. While downgrading exxon from buy to neutral. Meta called chevron a super major at an inflex point and says its poised for some major volume growth thanked to its permian acreage and its holdings in kazakhstan. As numbers continue to improve, he expected chevron will get a higher. Plus meta thinks management will give us a positive update on its Permian Basin<\/a> plans in march. At the same time, meta is a lot less optimistic about exxon. Quoting, lowering to neutral as limbed cat alift to drive shares higher. He thinks chevron is in a better position to great its production and its cash flow while exxon doesnt seem to be doing too much that can move the kneelnee. The reason chevron roared in response to its quarter while exxon got slammed is chevron has been doing a heck of a lot more to improve its position. At this moment, chevron seems like a better company. How about their stocks . Chevron trades at nearly 23 times next years estimates. If you go out to 2018, chevron is trading for just 16 times numb earnings. How. Dividends . Chevrons supports a 4. 1 yield. Exxon has got 3. 6 percent. I think this recent differential in performance could be just the beginning. Chevron appears to have a lot more upside. Exxon seems like its just sitting there. Heres the bottom line, though. Going into this quarter, we expected a boring, predictable quarter from exxon, but it instead made us worry about accounting issues that could harm the paper value of the reserves. Chevron on the other hand has been more of a wild card in recent quarters so when the company came out with some bullish commentary about its future, that caught a lot of people by surprise. Chevr a lot of upside Going Forward<\/a> from overseas asset while exxon seems content to be the same old big integrated oil company. Ill take chevron over exxon any day of the week. Much more mad money. Snack packs, slim jims, from favorite snacks to healthy choices, Conagra Foods<\/a> is bying some of americas big ef brands, but theres big news here you need to have on your radar screen. Then clorox has been cleaning up for more than a century. But after the companys earnings miss, has it created a mess . And four trends that have held up, ill reveal them all just ahead. This has been a busy moment for break jumps. First alcoa swins off as ar connick, then young brands spins off young china, which now gets more favorable treatment from the communist party. Weve got one more big corporate divorce coming up a week from now. Its conagra, the packaged food company. Separating its consumer packaged food business right here from its commercial food business for restaurants that will trade under the name of lam weston. Conagra announced this move a little less than a year ago and we have to figure out how to play the split. These are getting really difficult to play candidly. First let me give you some background on how all this came about. Conagra is one of the largest packaged Food Companies<\/a> in the world. Hunts catchup, pam, slim jims, a. They also have a big commercial business selling food and ingredients to major restaurant chains. Now, before we can really talk about the breakup, its worth noting that conagra had a serious problem in recent years. In 2012, the company massively overpaid for a Company Called<\/a> raul corp. Conagra was betting consumers weary of the Great Recession<\/a> would continue buying cheaper store brand options at the supermarket even as the economy recovered. But by 20 15rks business was still in steady decline. It was this weakness that caused the investors of janna partners. They bought a 7. 2 stake in conagra and they began pushing management to sell the bright label business. Thankfully conagras management listened and announced it was getting out of the private label business. They ended up selling it to tree house foods for a lot less than they paid. It ended up being a good deal for everybody involved. A few weeks later, conagra told us it wasnt finished, it needed to transform even more. The Company Announced<\/a> a major split into two businesses, a packaged food company, and you see a lot of this here, and a food service play focused on frozen potato products. Conagra brands will get all the consumer business, the ones i just outlined. The new lam weston gets all the frozen potato appetizers, vegetab vegetable products, some exposure to the frozen food aisle of the supermarket, this kind of thing im holding up now. Which brings us to the big question. Once this breakup happens next week, what part of conagra should you own . We went over whether you should own yum china versus yum. I actually like both of those. Ar connick versus alcoa. I like ar connick buzz its doing quite poorly. If you own conagra since the breakup announcement, youre already up 21 , so you got a win. Most of that is coming in anticipation of the split. Since its almost upon us, i think weve now got to make a decision. When you look over the past four quarters, its clear conagras Retail Business<\/a> in is in real trouble. The latest quarter they started breaking the business out differently and grocery and snack sales were down 5 . Refrigerated and frozen sales down 8 . International sales down 6 . Theres some very real weakness in the supermarket industry right now courtesy of food deflation and its clearly been hurting conagras numbers. Plus the consumer continues to switch away from processed foods in favor of healthier options as weve seen from campbells, as weve seen from general mills. Its not these guys alone. On the other hand, the commercial business thats being spun off as lamb weston, thats been doing a lot better. In the latest quarter, the core frozen boods business saw sales increase by 4 . The Company Already<\/a> sold its commercial spices business, so now lamb weston can really focus on the frozen and refrigerated potato market. I know it doesnt sound exciting but everybody likes french fries. Last month they held an investor day. After the spinoff, the new conagra is going to be an iffy turnaround story. Management is more focused on generating value rather than having a giant stable of brands. The Company Plans<\/a> to triage their brands, figure out which ones deserve lots of attention, which ones get lots of marketing and product extensions and which ones get put on the back burner. Conagra has a multipronged approach to restoring the growth. The company intends to invest heavily. They want to keep cutting costs in order to expand margins and intend to make a number of small acquisitions while possibly selling off some brands. If they execute well, they might be able to turn things around over the next couple years. About you if you want a company doing well right now, i think you need to go with lamb weston. When it comes to selling frozen potatoes to restaurant chains, lamb weston is the number one. This is an industry thats consistently growing at a 3 clip. Lamb weston believes they have a tremendous opportunity to expand the business overseas. I agree with them. Thats why the Company Believes<\/a> it can deliver high single digit Earnings Growth<\/a> over the long term. This is a terrific steady eddie business, and as long as the quarter of all restaurant transactions involve french fries, lamb weston should do just fine. This is the food we love. I really do love them myself. I dont eat them though. Conagras consumer business has a lot of exposure to the supermarket aisles that have been doing poorly in recent years. It was good to see kroger reaffirmed guidance today. Maybe conagra can get its business back on track after the beakup. What i like about lamb weston is its already on track. The one worry, its one week from the spinoff and they dont officially have a cfo. Heres the bottom line. For those of you who currently own conagra, heres my recommendation. When the company breaks itself up next week, you want to hang on to the lamb weston spin offand think about selling conagra. Lamb weston is a lean, mean, potatomashing machine and theyve got everything they need to generate decent numbers Going Forward<\/a>, where conagra is waiting for a turnaround that may not pan out. Theres no hurry to make ago i decision. We know theres big time confusion in the first couple of days. We saw it in the crazy trading in ar connick. Give it a few days and well report back to you about the timing, tell you if you need to make a move or tell you if you should wait for a better price. Ben in texas, ben. Caller booyah. Booyah, ben. Caller yeah. Rr donnelley has split into three companies, donlly and sons, Lsc Communications<\/a> and donlly financial solutions. Since the split, the value of the stock seems to have declined quite a bit. Is this a buy, hold or sell opportunity . Well, we said we needed to see numbers. We did a piece about how we were not happy with the way things shook out, and weve got to be able to do we want numbers. We want models. We got to have more information. We dont have enough information to make the decision yet. But we can refer you on the website. We did a bag take out on each one and what theyre worth. But without the models, you see whats happening. The exact same thing by wait is happening with ar connick. Without the models, no one is really sure what to do. We dont know what the company is going to earn. Lets go to paul in tennessee, paul. Caller jim cramer for president. Well, thank you very much. Im not a political guy, but i appreciate it. Caller jim, several months ago, Cracker Barrel<\/a> had a good run, and i believe one reason it appears to be a good stock is its dividend and especially its dividend bonus. Besides that, i never go into our local Cracker Barrel<\/a> a time its not packed. But certainly weeks ago, its price started going down even before the downturn. I like Cracker Barrel<\/a> stock. Whats your take . I didnt like the quarter. The quarter was really nothing to write home about. As a matter of fact, it was bun of the weaker quarters it actually started the theory that maybe restaurant dining is not so strong. And i will go even one step further frankly. It really took, lets say, darden was good and Cheesecake Factory<\/a> was good, but thats really about it. And Cracker Barrel<\/a> was one i expected to be really good because gasoline prices are low and people go on the interstate. It didnt happen. Im going to say not yet. Im going to say penalty box for Cracker Barrel<\/a>. The secret is potatoes. Skip out on the troubled consumer business of conagra and take a look at the menu for lamb weston. Much more mad money ahead. Is clorox looking washed out . Im eyeing the company after todays earnings miss although i still like it. Lets get the full story from the ceo. Then whats your annual teeth cleaning got in common with fido . Ill reveal and tell you how it could impact your portfolio. And ill your calls rapid fire on tonights edition of the lightning round. Stick with cramer. Announcer tomorrow, kick off the trading day with squawk on the street. Live from post 9 at the nyse. Ouch. This latest quarter from color exsent its stock tumbling. The maker of glad bags, chings ford charcoal, burts bee personal Care Products<\/a> and plain old clorox bleach. Lower than i would have preferred Earnings Guidance<\/a> for 2017. What is going on . Within the company, the results pretty wildly varied. Cloroxs cleaning products saw 13 pl volume growth. Lifestyle categories up just 1 . The company internationals volume grew. I think the real key here is that when youre a Consumer Packaged Goods Company<\/a> with a strok thats straighting at 21 times earnings, your stocks going to get punished when you even slightly lower forecast or even talk about price competition if you think the fed is on the verge of raising Interest Rate<\/a>s. So is this a temporary blip . Lets check in with benno dorer, the chairman and ceo of clorox. Welcome back to mad money. Its good to be back, jim. Benno, im trying to figure out the narrative. Im trying to figure out whether you guys were more down beat than the analysts. I heard a lot of about Price Inflation<\/a> of commodities. I heard a lot about competition. I heard about not wanting to lose share. I did not hear enough about the great growth areas that i think are sustaining the company in a period where a lot of companies arent doing as well as yours. So im giving ah chance to theyre the narrative on air. Thanks for that opportunity, jim. Indeed, the highlight of this quarter was the very strong top line growth that weve seen. We have a lot of growth in an environment where growth is so hard to come by. Weve shown 8 volume growth. Weve shown 4 sales growth, 6 currency neutral on top of a strong yearago 3 sales growth, and weve been able to convert that sales growth into 3 Earnings Growth<\/a> on top of a very strong 20 Earnings Growth<\/a> last year. I feel good about the business. Were one quarter into this fiscal year. We have a lot of momentum on e business, and were staying the course. There was indeed some companies that seemed to almost make a suicide pact with each other, and you admit that it happened. In other words, theres price competition. But it didnt grow volumes. Why do Companies Just<\/a> maybe give me an economics 101 or Business Management<\/a> class. Why do Companies Cut<\/a> prices if they cant whats the point . We have seen Competitive Price<\/a> promotions in certainly categories. For instance our glad trash bag business is one of those. And were seeing that because commodities have been somewhat favorable, and then what companies tend to do is recover lost market shares by reinvesting into trade promotions. We are not afraid to defend our business if that makes sense, and we have done some of that on glad trash bags. But we really take a longterm view, and we try to focus on being balanced and growing our business the right way. And growing our business the right way for us means to invest in our brand equities and to invest in our innovations. And were in the very fortunate position to have a lot of innovation in an environment thats really innovationstarved and thats working well for us. Over time, we think this price promotion will subside because commodities are expected to firm up over time, and we think that the business from a competitive point of view is going to return to be more rational in the mid term. There was a moment steve robb, your cfo, hes a straightforward numbers guy, and hes asked point black about renewed life. I have to be a big user of ultimate flora. I just think everybody is going to, and by the way, the ceo of dupont agrees with me and he makes probiotics forriv everybo. But on your Conference Call<\/a>s, he says basically he does not think renew life is going to move the needle for your company. If you put a lot of money behind renew life and we all start taking it every day and start hearing about it, why would i not think that in two years it would be a huge needle mover . It will be a needle mover. What steve robb, who indeed is a numbers guy, and its good to see that he is. What he said is that it has delivered 2 volume of sales growth for us this quarter, but, you know, it is certainly on the smaller side. Still its about 100 million in revenue, and for a 6 billion company, that is not yet as material today as it will be tomorrow. So we love this category. We made this acquisition of renew life in may. Its in a category thats very profitable, thats growing double digits, and where our capabilities, in particular in the marketing, innovation, and distribution building side, really play quite well. Its doing exactly what we hoped it would do for us. Its growing nicely. The integration is well on track, and were starting to expand distribution. So watch the space on renew life. This is a business that will do very well for us over time. Okay. How about your spend . You talk a lot facebook reported tonight. It looks like theyre still getting a lot of advertising spending. Can you kind of break down where you are doing some spend. It looks like youre still getting some results online for some of your products. Were getting very good results online, which is why we have, over time, moved our investments into digital and soci social. This area accounts for 40 of our working media spend, which i believe is at the leading level in our industry. And we continue to shift investments into the space because were seeing the rois follow. We get very strong returns because digital and social allows us to give the right message to the right consumer at the right time and really engage consumers in twoway conversations. So we feel good about communicating in digital and social, and i expect for us to continue to shift investments into this arena over time. All right. I was surprised that lifestyle only gained 1 on a volume basis. To me, its one of the most deciding parts of your company. Is there anything short term that could make that that depressed it so i could think a year or two from now, you could get better volume growth there . This is really a matter of yearago comps. As you noted, jim, a lot of our growth businesses are in the lifestyle segment, and this is a segment thats done very well for us recently. And we expect that to continue in the future. All right. And then international, im still waiting for you guys to really turn on the jets. Put it in incremental dollars overseas . Well, in international, we continue to face the macroeconomic challenges that everybody in our industry faces, and that has a lot to do with Exchange Rates<\/a> and with cost inflation. Im actually quite pleased with the 4 volume growth that weve seen, 10 currency neutral sales growth, and we are focused on stemming these head winds that are talked about through pricing, cost savings, going lean, and were doing that very well. But were also starting to invest in growth opportunities. Renew life did extremely well in canada last quarter. Burts bees in asia grew more than 60 last quarter. I feel very bullish about the International Business<\/a> long term based on the strength of our brands. Thank you so much to benno dorer, ceo of clorox. Great to see you, sir. Thank you. Good to see you, jim. Thank you. This was a good quarter, but these stocks are out of favor right now. One day they will be back in favor, and you will want to own clorox. Benno dorer, clorox ceo. Stay with mad money. What are you doing . Getting your quarter back. Fountains dont earn interest, david. You know i work at ally. I was being romantic. You know what i find romantic . A robust annual percentage yield thats what i find romantic. This is literally throwing your money away. I think its over there. That way . Yeah, a little further up. What year was that quarter . What year is that one . 98 thats the one. 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Announcer lightning round is sponsored by td ameritrade. It is time it is time for the lightning round thats where i take your calls rapid fire. You tell me the stock. I tell you to buy, buy, buy or sell, sell, sell. Well play this sound [ buzzer ] and then the lightning round is over. Are you ready, skeedaddy . Its time for the lightning round on cramers mad money. Lets start with marty in california, marty. Caller yeah. How you doing, jim . Booyah. Booyah. Caller im calling from oak dale, california. I was wondering about i got 75 shares stock in jcpenneys. I was wondering should i hold or should i sell . Look, jcpenney is much better run than it used to be, but its very tough retail season, very promotional. Kate spade said that today. I would say dont buy anymore, but its okay. Thats all i can say. Its oak. Andy in utah, andy. Caller booyah, jim booyah. Caller gw pharma. Its run up a great deal on some very good news about a terrible illness and what it can do for child epilepsy. I still believe in the future. Theres a lot of good things that can happen, but it has run up. Stocks that are run up and stalled in this market tend to stay here. So im not aggressive on it. Lets go to christopher in colorado, christopher. Caller hi, jim. Im new to the stock market. I have shares of nsu, and i was wondering because gold prices were supposed to go up by december 31st, if nsu is a good investment. I dont know that. I dont follow the canadian golds candidly. Ive got to do work on it because i tend to have lost a lot of money when i followed them when i was a hedge fund manager. I will do work on it to let you know. Lets go to brad in california, brad. Booyah, jim. We love you out here in california. Thank you. Caller now, jim, these pharmaceuticals, they got less than desirable results from a Clinical Trial<\/a> and then it goes down 60 in a day. It happened last week and again today with sempra. I know. Caller it seems like an overreaction and youre spending a bounce of some kind. They tend not to be. These are the problems with this. When you only have one shot on goal. This Company Seems<\/a> to have like one i mean theres not a lot in the pipe for this company. I invite them on to find out what else they have, but when you see these declines, they tend not to bounce back fast. Be careful. Lets go to dave in illinois, dave. Caller dr. Cramer. Yes. Caller synchronizing data across all devices, amazon echo, and i like otex, open text. Its expensive, man. Thats an expensive company. A lot of these you know, what, its a good company. Im just kind of struggling because if facebook is down this much, then anything can go down. But that is a good company. I cant just say sell it because facebook is down. And that, ladies and gentlemen, is the conclusion of the lightning round [ buzzer ] announcer the lightning round is sponsored by td ameritrade. Do it for everyone g. Well, i feel pretty smart. Well, were all about educating people on options strategies. Well, dont worry, i wont let this accomplishment go to my head. Im still the same old gary. Wait, you forgot your french dictionary. Oh, mucho gracias. Get help on options trading with thinkorswim, only at td ameritrade. Whats Critical Thinking<\/a> like . A basketball costs 14. Whats team spirit worth . cheers whats it worth to talk to your mom . Whats the value of a walk in the woods . The value of capital is to create, not just wealth, but things that matter. Morgan stanley in this difficult environment where the consumer seems to be paring back on erg, what are people still doing . Theyre still going to the dentist. Still taking care of the pets. Theyre still playing video games, which is what the run in Electronic Arts<\/a> today is tell is us. And theyre still going to the supermarket to buy food so they can cook at home, as you can see from todays run on the stock of kroger. And tonight in the stock of whole foods after some surprisingly good numbers. Weve hit on these big themes before over and over again. Theyre the bullish themes that are still working, and its terrific to see them remaining intact. We learn early in life to take care of our teeth. Thats something that doesnt ever go away whether its with solid and growing toothpaste sale as round the world from colgate and Procter Gamble<\/a> or the denl Equipment Sales<\/a> from henry schein. Its not all done with smoke and mirrors either. The companys sales growth increased by 5. 1 . Remember, the latter is the kind of growth we like because it comes naturally. Its not purchased. The second powerful theme, we shower our pets with love. You know why i call this the humanization of pets theme. Few companies have taken advantage of this trend like zoe ettis. Introduced a drug this quarter called app oh quell which stops dogs from itching almost immediately. For those of us with dogs, and we have two rescue dogs, bud, and everest, the drug is a godsend. We put that fabled elizabethen collar on their necks when theyre all itchy and scratch kbr and now were going to give them app oh quell. Judging by the early sales, were not alone. By the way, henry schein sells equipment to vets. Electronic arts delivered a terrific number last night much to the chagrin of those who sold the stock down 5 . What do i say . Wait for the Conference Call<\/a>. They didnt seem to wait to see the companys certain games are doing pretty well and theyre predicting great things. Theyre all gog have a good holiday scene. Then take 2 reported great numbers. Kind of eyepopping figures. These Video Game Companies<\/a> are immensely profitable and theyre all part of the stay at home thesis we keep articulating. Most of these games are all digital downloads, theyre not being bought at game stop. In fact, very few people are boyi buying from game stop. Hence why that stock fell 2. 63 or 11 . So dont relate the two. Video games are incredibly strong. Finally kroger, kr, confirmed its annual Earnings Guidance<\/a> today. Thats a big deal these dayed. Shaded up, not down next years numbers. Ive been waiting for this moment because it confirms something weve been talking about when it comes to, say, mccormick, the spice maker. Whether its because of costs or fear or desire to nest, people arent going out to dinner as much as they used to. We know that from most of the restaurants, which have all reported disappointing numbers, but now we know it from the other side, kroger, and this stock is dirt cheap after being hammered relentlessly. I like it now. Food deflation seems like its gotten past them. One thing thats certain, though, this company is absolutely capitalizing on the stay at home thesis. We need to find out more it looks like things as we depart this evening are even looking up for whole foods, which reported a surprisingly better earnings per share number, although samestore sales still not what i want to see. Going to the dentist, pets, stay at home dinner thesis, all these trends are proving to be bankable during what is definitely becoming one of the most turbulent earnings seasons, if not turn leent seasons ent e entirely in this country. Stick with cramer. Hey, hey, hey, there are no bad suggestions here. No matter how lame they are. Well said, ann. Ive always admired how you just say whats in your head, without thinking. Very brave. Good point ted. Youre living proof that looks arent everything. Thank you. Welcome. So, fedex helped simplify our ecommerce business and this is not a passive aggressive environment. I just wanted to say, you guys are doing a great job. Whats that supposed to mean . Fedex. Helping Small Business<\/a> simplify ecommerce. Will your business be ready when growth presents itself . American express open cards can help you take on a new job, or fill a big order or expand your office and take on whatever comes next. Find out how American Express<\/a> cards and services can help prepare you for growth at open. Com. I like to say theres always a bull market somewhere, and i promise to try and find it just for you right here on mad money. Im jim cramer. See you tomorrow. Whoo why grow up . [screams] hi, im jay leno. All hi, jay hi, everybody, how you doing . And this is a show about cars. Its fun to drive cars that are really different. This ones a death trap. Oh, i see because because its dangerous to ride. And motorcycles. [revs engine] and, well, anything that rolls. Better buckle up, little boy. Oh, my god, strong as an ox explodes. I love the smell of napalm in the morning. Yeah or makes noise. You ever run a dragster . No, i havent. [engine roars] this is jay lenos garage. Start your engine. 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