Transcripts For CNBC Mad Money 20170126 : vimarsana.com

CNBC Mad Money January 26, 2017

Against American Companies is a suckers game because of our innate progress and natural expansion even as the markets day to day gyrations wont always be positive like todays mixed session where the dow gained 32 points. S p declined 0. 07 , and nasdaq just dipped into the red at 0. 02 although it could be heavier tomorrow because disappointing numbers from starbucks and alphabet that may not be offset by what looks to be a strong microsoft performance. For almost his entire investing life, buffett has made the point that you can generate great wealth by owning the best of the best, not flipping them, not flitting in and out, but getting on and staying long. I think hes got an edge on all of us. In addition to having the finest mind for investments of his generation, hes got a team of people who can stay up on his stocks. I always say if you cant stay up on your homework, if you cant research and examine and spend time knowing what you own, if you couldnt give me three bullet points on why you bought a stock, then you do need to invest in a different fashion. In that case, you should own just an index fund like a simple lowcost fund that mirrors the s p 500, mirrors the s p 500, well, which one . There are tons of them. But thats what you should be doing if you cant tell me what the stock is. But what if you do like individual stocks . What if you just want to pick some . What if you think you can pick them good . You got that diversified index fund already and then you can buy some stocks. Is it possible to pick winners . The purist, the ideal logs who come on our area constantly who insist that beating the market is all just chance, would say youre taking your Financial Life into your hands if you buy a stock. I never say that about stocks. You can put your retirement money in an index fund. I think thats fabulous. You can put some of your discreasary monday, your mad money in some stocks, i think they can coexist. I say that because i think this dow 20,000 occasion can be a teachable moment for us. A teachable moment about how to spot long term winners like buffett would. Its also an excellent reminder that some companies can triumph over any environment simply because theyre run so well. So lets do this. Lets go back in time to the last time the dow stood at 10,000. That was 2009 and see who the five biggest winners in the dow since then and asked ourselves could we have spotted them, or would the purists and ideal logs say you never would have found these, theyre needles in a haystack. Lets see if they have potential to do well Going Forward because this is mad historical money. Its mad money. First the bigger win since dow 10,000 is United Health which has rallied 548 . As someone who has run a company that has had to deal with unh to insure my employees, this is one fabulous business. There arent that many competitors. At one time i was trying to pit United Health against oxford price to get a better price for health care for a couple hundred employees. During the negotiations, United Health bought oxford. Take a guess where my bill went after that. United health had the vision to recognize that it needed to become more than just a Health Maintenance organization, though. It has this business optum, which is part pharmacy benefit manager, part health care business, processor, outsourcer. Its got unbelievable data. Meanwhile United Health had the smarts to pull out of obamacare when the company realized it couldnt make money participating in the exchanges. That move, i think, has made it the only Health Care Company worth owning right now. Thats right. I dont like the health care companies. You know that. Only that because its not trapped in a system that is going away. Its the only Health Care Stock that i consider to be trump stock, trump stock, trump stock. Therefore, i think it can go higher. Next up is home depot. Its up 402 since dow 10 k in 2009. This statistic is really nothing short of amazing because home depot put up these great numbers during the worst housing recession not in the last few years, not in the last few decades, but ever. This is a period where you could easily argue that home depot should have gone out of business. But boy would that have been wrong. Home depot used the downturn to solidify as the number one do it yourself retail chain. The company had a remarkable ceo who energized the place, use the technology to make the store better for you, the customer. He stocked their location with friendly, helpful workers. And for us power gardenseergard. It didnt hurt, but i just think frank ran Better Stores with the help of the best cfo in the company and franks successor, the current ceo, who is doing a remarkable job. One of the reasons why i still like the stock. How about apple . Its rallied 346 in the same period. When you have the best product, the most sought after product, youre going to do well. Thats the iphone. Born a less less than ten years ago. I meet so many people who tell me im as washed up as apple for supporting this company and its stock. They usually tweet me or text me that im washed up on an iphone. Hmm, okay. All i can think of is when the stock was last at 93 and i read so much articles about how apples best days are behind it and i was getting all these nasty emails from people saying, jim, jump ship, jump ship, well, i didnt. You know what i did . I invited tim cook to come here. He came over here. We sat down. We talked. The stock was at 93. He disagreed that the worst times were ahead. He laid out a multiyear strategy. Apple is nearly up to 122. The defense rests. Sure this coming quarter may not be that special but the company has approximately 40 per share overseas cash, and if that can be repatriates, part of the trump tripod, thats going to be huge for shareholders. So go ahead and sell it. Ive never stopped anybody from selling it. Regina, my executive producer, have i ever stopped anyone from selling apple . Not once. I needed someone to verify because people just say when i bought my kid two ipods because one was pink and one was blue. How about this visa . Some Companies Ride a secular wave for as long as possible. All around the globe, there are people who still use checks. Visa is a vicious competitor for your business. There are years of growth ahead but i have to point out that sharly scharf just retired and that makes me less certain about visas future versus say mastercard, with its phenomenal ceo. Personally, make the switch. Finally theres walt disney, which to me aside from apple is one of the most obvious stocks to buy in the world. Anyone with kids knows disney is the Common Ground that all infants share. It produces hit after hit like clock work. The stock has been down of late. We did a big profile last night. A function of declining espn subscribers. But the ceos multiple levers in order to keep generating the 240 gain that disney gave you from dow 10,000 to 20,000. So are these gettable . Lets, see. Well, its likely United Health is your insurer. Thats an odds on favorite. You might shop at home depot regularly. Im there probably 10 times duri during gardening season alone. I have a visa card in my wallet. You probably do too. I took my kids to disney world four straight years when they were little. Apple speaks for itself. Let me add on another layer. While these stocks have been integral to the rally since trump was elected, i dont think of them has really gotten ahead of itself because the fundamentals are terrific for these companies. Most will benefit from lower corporate taxes and repatriations of foreign assets. Theyre perfect example of why i say the rally is not a sugar high but reasonable. Heres the bottom line. The biggest five winners since the dow powered from 10,000 to 20,000 i think were totally gettable and in some cases down right obvious. They arent here on sugar. Theyre here because management has been terrific, innovation extraordinary, and their attention to the customer, superb. Those are difficult traits to erase even if donald trump fails to get much done as the 45th president of the United States of america. John in california, john. Caller booyah, jim, from Sacramento Valley out here. We love you out here. You know a love sacramento. I go the to get back there when i go back in february. Whats up . Caller a while ago i had sem ex. Ive been hanging on to it with a lot of interesting stuff. Theyre paying down debt, acquiring companies in the caribbean, and i played it for the wall build. A lot of cement comes out of texas. I was wondering whats the play now with this mexican situation . Are we going to have a problem with cemex with housing tracts and freeways are going crazy out in california . Thats true, but thats why we like u. S. Concrete and thats why we like Martin Marietta materials. We look at the balance sheets. We dont want the sizzle. We want the steak. U. S. Concrete, Martin Marietta materials. Tammy in utah, tammy. Caller hi, jim. Thank you so much for taking my call. Of course. How are you . Caller im not hearing anything, so i guess ill just go on. Sure. Caller my question is on previous shows youve advocated oil drilling and natural gas stocks. With regard to competition from sl schlumberger and possibly ge, was your recommendation for last week the hydraulic Fracking Company king group . I looked at it. Schlumberger went down a couple bucks after they reported. Schlumberger is just the best of breed. If i see you on the street, tammy, two years from now, i dont know where keen group will be. I know schlumberger will in be the catbird seat. Thats why im recommending it. My Charitable Trust owns it. Will in florida, will. Caller hey, jim. Thank you for taking my call. Of course. Caller the company is called nutanix, kicker ntnx. As the number one pure play in the hyper converged Infrastructure Market with a 52 share, numerous aligns with microsoft, intel, and the recent m a in the space, do you see them being on someones radar in the immediate future . Yes, i do. As a matter of fact, because you know what hpe did with the simplivity. So yes, i think nutanix could be acquired. I think it makes sense. Otherwise, i think its doing fine but i have to tell you its not an inexpensive stock. But were covering a lot of noninexpensive stocks tonight. I deem it ready for speculation. All right. The top five performers since dow 10 k are winners because theyre just plain terrific companies with great management. Im saying they are gettable right in the face of people who say, you must be in an index furnd no matter what. On mad money tonight, its the Fastest Growing Technology Company on either. Ill reveal it when i sit down with the ceo just ahead. Then, sure, the dow hit 20,000. Time to pop the champagne. Im not a champagne popper. And the lions get all the hype. But could a lamb get all the wall street talk snk just a second. Thats a rim shot. Dont miss my interview with the ceo of chip maker lam research which was down a little today. 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. Introducing conduent. One of the largest business process companies in the world. Whether its in health care, customer care, technology, transportation or government. We touch millions of lives every day. Conduent. Advancing the everyday. 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 cards and services can help prepare you for growth at open. Com. Find out how american ewere 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. Did you know slow internet can actually hold your business back . Say goodbye to slow downloads, slow backups, slow everything. Comcast business offers blazing fast and reliable internet thats over 6 times faster than slow internet from the phone company. Say hello to internet speeds up to 250 mbps. And add phone and tv for only 34. 90 more a month. Call today. Comcast business. Built for business. In the immediate after math of the election, some people thought the high growth tech stocks would sit out the trump rally because too many Money Managers would be pouring their cash into more cyclical companies, the ones that tend to boom with the economy accelerates. Now it seems the tech is on fire. Take service now, the cloudbased company that helps Corporate Information Technology Departments build their own internal applications while also letting its clients automate functions like human resources, legal, finance, security, and facilities management. A few years ago this was a small company. But now its the leader. Its the leading player in the intenterprise i. T. Service management business. After stalling a bit last year, stock has been on fire in 2017 and the fire keeps on burning. Last night the Company Reported a terrific quarter. They delivered a one cent earnings beat with higher than expected revenues, including a monster 52 increase in subscription billings. Even better, service now gave strong guidance for both the next quarter and 2017 as a whole. Thats why the stock shot up more than 3. 6 today to a new all time high. How does this thing keep running. Lets take a closer look with the president and ceo of service now to learn more about the quarter. Mr. Slootman, welcome back to mad money. Good to be on with you, jim. I talk to a lot of guys in tech today and they all were saying one thing. Which is could you ask him how he was able to do 52 growth because nobody has that growth. One of the guys just said, ask him what the secret sauce is. Well, you know, we lean in pretty hard. What youre really seeing is a really successful platform strategy in action. Weve been working on this for many, many years, and when all the pieces are falling into place, were hitting on all cylind cylinders, then you get an incredible tailwind. Q4 was a special quarter for us. Everything went right, and you are seeing the results of that. Now, theres some great stuff in the Conference Call. You do this Customer Service management. Most people i know are fed up with Customer Service. Its automated. We dont know what were going to get. We know that onces it goes into the queue, youre never going to hear from it again. You have a phrase where you talk about Customer Service isnt isolated. Its a team sport. And your software makes that happen. Tell all the people who are frustrated that they should be using clients they should be having servicenow where they call because your place is different. When they bring you in, its different, isnt it . Yeah, it is different. We have a Service Model that is holistic in the sense that it brings Customer Service, the engineering ranks, the operational people all into a single work flow. Most Customer Service products, what they do is engage with the customer and deal with the symptoms of a problem, but they dont go back into the engineering ranks and figure out why they people had to come in here in the first place and make the changes to prevent these things from happening again. That is the core Service Model different that we provide. And of course the i. T. Audiences that we traditionally serve really understand and appreciate this, and they want to advocate that into their Customer Service departments. I thought it was interesting also that you have security guys. They figure out the threat. Theyre able to stop the threat. They know where the threats coming, but they dont talk to anybody in an organized way . Yes. Huge amounts of money on average customers, like 75 different security tools, and theyre all sitting at the front end doing detection and vulnerability scanning and enforcement, but when it comes to response, its just guys and gals sitting behind spreadsheets running around, texting, email. There is no structured work flow to work through a threat resolution. That is what we do. Its unbelievable that nobody has really stepped into that opportunity up to this point. Yeah, i found that amazing. I wanted to ask all the companies, what are you doing . This is ridiculous. Now, youve done some work for campbells soup. Thats a Company Everybody knows. Is it Customer Service, is it security, that kind of thing . Yeah, its very typical in the sense that we started out with campbells soup on the i. T. Front, and they have gradually moved into all their other service domains. So human resources, you know, facilities, finance, and so on. So they really have caught on to the overall platform play and said, look, this is how we manage work inside our enterprise instead of relying on people running around email, text, and so on. On that last ibm call, and i liked the call very much. Im close to those guys. They did a lot of good things. But i think some of their strength this quarter must have been because theyre teaming up with you. What do you do with ibm for a customer . Well, you may have heard me say in the past that ibm was sort of slow to come along relative to so many other major integrators like we have like accenture, who has been big with us for a long time. This quarter, ibm has really stepped up big, and were really thrilled to ha

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