Transcripts For CNBC Mad Money 20170515

Points. Nasdaq advanced 4. 6 . The big story is that the industrials are stalling out here. Thats right. Theyre stalling out while the techs are head rot. What does that mean . You can easily interpret this action on an hour by hour basis, suggesting that we need to be worried about an economic slowdown. But i think that would be a mistake. To me the teches are roaring while the industrials languish, because investors keep gravitating toward the companies that have the most up site in the second half. Now that it looks like the trump steam roller has run out of gas. Remember, is stock market is a forecasting machine, it looks ahead about six to nine months. We thought that the president would repatriate foreign assets, tax cuts and lots of deregulation. Wall street is enamored of him. Which means the stock market likes him very, very much. Now were getting deregulation in spades. Just last week, the president presented two men to the regulatory commission, trumps already put in regulators who favor consolidation in television. Hes cut wilbur ross as the ak secretary. And he wants to protect the entire Steel Industry by declaring it a National Defense asset. But when it comes to actual legislation, like Corporate Tax reform, it seems like thats now taking a back seat to the comey russia investigation. Tax reform is so stalled we dont even hear anymore hang wringing about that possible border took, because the house has deep sixed the entire package. Even steve the president would rather spend his time relitigating the election. Major legislation simply does not pass without the white house ramming it through. Chineses indicate va all i c say is thank heavens for communist china. Our Republican Controlled Congress hates spending money. In fact, the biggest projects here in america our state highway systems, most notably, california and texas, theyve got money to burn. Meanwhile the rally between crude and the worlds largestics porter, crudes big move today may seem like a big surprise, but the tostocks anticipated la week. U. S. Producers will just sell futures aggressively as oil goes higher here. And so many of them are really quite profitable at this level. But the stock market like nature abhors a vacuum. Its not like you take that money out of the asset plans, you just roll it from one sector to another. As you saw in todays just released sec files. Lets start with the one thats getting rolled in the most of any company in the stock market. The red hot semiconductor stock. You might be wondering how is it possible that a stock without a takeover bid can go day after day. Besides the fact that many people were shorted. A loftier valuation that many tech companies. You only need to listen to the Conference Call to recognize that jenson wine, the kroenlt isnt justs toing out artificial intelligence. Hes pioneering ai. Theres a moment on this call. Once said that while software is going to eat the world and jenson thinks, and this is really important, people. Artificial intelligence is going to eat software and is going to beat every aspect of software. Every Single Software developer has to learn deep learning, every Single Software developer will have to learn artificial intelligence, every Single Company will use artificial intelligence. Ai is the automation of automati automations. All that money thats going into tech stocks should be going into artificial intelligence. Why do we do it . Nvidia. Theres a second ai play, thats alphabet, the parent of google. Alp which goes to show this suspect some sort of pie in the sky move. I think alphabet is way ahead of everybody else in the category. When you get in that car, and you tell it to go to ruths steakhouse, you can sit back and enjoy, its a much bigger driver than you would be or any other professional would be. It could be a real foot race if intel can lower the cost of mobilized autonomous driving chips. Attend of the day, theres always a story that makes tech look good. And then cramer fave proof point. I hope you watched them when they were on our show two weeks ago. Stocks soaring here, not done. After last weeks slaughter of intel at the hands of amazon. We have listen to believe that theres a few retailers among a ton of losers. Look at dominos hitting another high today. Theyre congrestantly trying to come up with better ways to order online or even mobile. The Driverless Cars and the internet of things and gps will really help the bottom line here. Heres the bottom line itself. As long as the president remains an impasse with congress, look for ancillary plays, like sbs. Broadcom or analog devices, these chip machines that you need in order to put out the best semiconductors. And dont forget, the Money Managers buying these stocks all think theyre cheap on next years numbers. They want revenue growth, and these companies they have it in spades. George in california. George . Caller structure funding, whats the gamble jim to holding on to nucor . We told our travel trust holders, its in a straight line, being hurt by the others, and if you want to look at chinese infrastructure. Its going betty in connecticut. Caller i want to know what you think of cigna stock in light of all the trouble they had with the merger. I think that theyre a big winner in the republican plan, i think thats what people have to start recognizing, cigna, united, theyre all winners. How about nick in california. Nick . Caller booyah, mr. Cramer. First i want to say that i really appreciate you and everything you have taught young investors like myself. Thank you. Caller i have a question about amd, after the Second Quarter guidance was released, the stocks fell 20 . Is now my time to buy . I think its fine, i think that the Company Really botched its Conference Call. They really gave you no real sense of things. But snaps bouncing back, so amd can bounce back too. Caller jim, viacom is my stock. This thing has come down so hard, so fast, i got to believe theres some value there. The thing is at 33, i dont know, to me thats just too cheap. I would certainly not sell at this level. That would be wrong. I dont know what gets it higher, but the market has gone down. There are plenty of winners out there, well find them together. On mad money tonight, Epr Properties is one of the largest Real Estate Investors in schools and megaplexes across the country. Im find out where the company can continue to break down. Then as we enter the next round of retail earnings, is all hope lost for the group . Maybe not, ill tell you which stocks in this base can potentially rally. And its different from what youre hearing. Good news for oil today. With saudi arabia back on line, c where could crude be headed . Stick with cramer. Remember here at ally, nothing stops us from doing right by our customers. Whos with me . Were like a sports team here at ally. If a sports team had over 7. Im in. 7,000 players. Our plays are a little unorthodox. But to beat the big boys, you need smarter ways to save people money. We know what you want from a Financial Company and well stop at. Nothing to make sure you get it. One, two. And we mean nothing. Your insurance on time. Tap one little bumper, and up go your rates. What good is having insurance if you get punished for using it . News flash nobodys perfect. For drivers with accident forgiveness, Liberty Mutual wont raise your rates due to your first accident. Switch and you could save 509 on auto insurance. Call for a free quote today. Liberty stands with you™ Liberty Mutual insurance. These Retail Properties in this country, we simply have too many stores when consumers no longer want to shop in person. If Companies Want to make it through this difficult period, they need to give the millennial so hotters. A Real Estate Investment trust that owns all kinds of educational to retail related they are merchants of experience with a Charter School kicker that cant hurt given that our new education secretary likes Charter Schools so much. A fund named cnl web style properties. While the Company Reported a solid quarter two weeks ago, it wasnt able to hold the stocks decline. Is this the buying opportunity we have been waiting for . Lets check in with the ceo of Epr Properties. Im thinking this is a great opportunity but i want you to walk people through a really important transaction with cno, which gave stock, which maybe people who got the stock sold it down. It was a 700 million transaction that we funded with over 90 equity. So we took the advantage to d e deleverage the company. So we thought there could be some volatility. We have not seen large numbers of volatility, we have seen some trading, but really strong support in and around the low 70 number. So we think its a real good opportunity. What did you get . We got ski properties, we got water parks, not resort destination, but daily metropolitan, in and around major metropolitan areas that are serviced by top quality brands. Water parks that use water as an experience and an ability to take advantage of admissions an concessions businesses that we know a lot about. This is where people take thousands of selfies and pictures. I want to talk about top golf. Somehow this thing is booming, you told me it would boom, i didnt see it coming, i saw calloway a lot. What the heck is up with golf. It really is about the experience, you take an activity thats difficult for many people, the time commitment, the expense, the frustration. But you wrap it up in an entertainment setting with a credible food and beverage opportunity. To have fun with friends, family, colleagues and its been incredibly successful. Its just a great concept that wire proud to be a part of. Theres some short sightedness about the analysts. This megaplex business is fabulous. Talk about the numbers that go up after youve been involved and refurbished. We have a good set now that we have been open for a year or more. And those stores, its been a top line revenue increase over 40 . Doesnt that mean if youre one of these gigantic real estate trusts that are hurting in shopping malls, they should be trying to figure a way to partner with you. We actually do with some of the mall guys, part of the answer is going to be, everybodys looking for experienti experiential, but entertainment doesnt solve bad demographics. If we have a bad property, entertainments not going to fix that. Entertainment makes Good Properties better. Okay. Whats going to happen to some of these guys . You know, it is true, everyone was looking pretty good, but as stores get shut, i mean, you can come in and you have no dog in the hunt. As stores get shut, its not that much fun to go. And truly, what we have found out is that the malls used to be part of the experiential, you went there, and you met with friends. Here not a foreteller that retail is going away. We are over retail as a country and we need to get down to a right size. For some reason wire under a megaplex. There were retailers that could pay big numbers. Right and before this happened, before amazon, you were not the highest and best use. Now its creating opportunities, where there are Good Properties. I think epr, monthly dividend, good return, thats got to be right. Its going to be great. What the properties we own, people understand, they experience them every day and were really glad to be part of this experiential economy. Trump trade, the charter, you got the person, in this country, who may want Charter Schools more than anybody else as near as i can tell. Its no doubt that School Choice and School Options being led by someone who has a big voice in that community is very positive. At least for School Choice and were proud that shes out there carrying that voice. And what can she do . I mean what happens, what can the federal government do . The federal government really doesnt drive schools, but it does set the narrative. When people are beginning to talk about these issues, when people are beginning to understand that we have someone whos supportive of choice, then again, it lets it at a local and state level, where most of these decisions are actually made. I think this is the right time to own this stock, i dont see yields going back up to 4 bucks. So many of you say how do i get paid monthly . How about 5. 8 monthly. Everything is hitting on all cylinders. Mad money is back after the break. Coming up, cramer sets his eyes on energy. Can a bounce in oil earn you a barrel of profits . The ceo of Magellan Midstream partners gives his take on the sector. You wont see these folks at the post office. They have businesses to run. They have passions to pursue. How do they avoid trips to the post office . Stamps. Com mail letters, ship packages, all the services of the post office right on your computer. Get a 4 week trial, plus 100 in extras including postage and a digital scale. Go to stamps. Com tv and never go to the post office again. As we head into the next round of retailer earnings this week, i think we need to wonder if things are really as grim as the action in the stocks would have you believe. And you know ive been more negative than anybody. Take a second look at the crucial reports from macys, kohls, nordstroms, pennys, you find things you can like about these. Im certainly not saying that they cant go lower, but its possible some of them have indeed come down too far too fast. Lets start with macys. The numbers were clearly disappointing. The companys been relentlessly cutting his forecast. Same store sales horrendous, down 4. 6 . Apparel is pretty disastrous and the stock fell hard down to six years lows, first macys does sport a 6. 5 yield, pretty stable. Second the stock may have been near to these levels all right, it wouldnt be such a precipitous decline if there wasnt such 50ididle nonsensibl takeover talk. Seems to have an awareness of what they can do to race their numbers. They got to make the stores look better, get rid of those plastic hangers, shoes have become a winner. Fine jewelry, makeups doing well. Its not a total debacle. Although i could argue that macys is the best of the four. I actually like kohls. An aggressive buy back, and for the last five years, they have shrunk the share cap from 200 million to 170 million. Also stores in street malls, which makes it easier for the company to leverage order pick up at the store better than any of the other mall based. Kohls saw what can only be described as a dramatic pick up in february. The real story is how under alarmed the launch went. If kohls brings in other name brands, it sure seems to know how to sell them. I also like its personalized price theres a lot kohls can do with machine learning, in short, it is the best of the four. As for nordstrom, i was confo d confounded by this one. They have a 4. 6 decline in same store sales. Apart because nordstrom itself becomes confused. The discount business seems to have stalled. I nordstroms seems to have lost its way. Unfortunately at a bit of 3. 4 earnings. But one thats most intriguing, just in terms of being down and dirty is jcpenney, because it certainly has some strong things going for it. On the same day that amazon was vocal about taking them on and the companys support business remains hot. Its in many more stores that people realize, and wherever it goes, it works. Including long lines out the door of the mall. A block long in some of the rural openings, im not kidding, they have been opening in these places. The salon business is smoking too. And they still have a lot more stores that they can put supporters in. However Ceo Marvin Ellison started his Conference Call by saying his stores had disappointing top line reports. The downgrades here seem endless, this stocks truly been kicked to the curb. Home depot is facing its first real amazon challenge, with many of its suppliers reporting good numbers. However, its worth wonderering if some of these retailers arent oversold. I wouldnt be surprised if kohls can rally after a potential win from either home depot or target. Dont get me wrong, bricks and mortar as a category is in trouble. But when the smoke clears here, i think you will get a snap back and the best snapper will most likely be the stock of kss, the stock of kohls. Parker in washington, parker . Caller hey, jim, a big booyah from washington. Im a 20yearold new investor and i would like to say thank you for all the insights i gained from reading your book mad money. Thank you. First any advice you can give me and other young investors on how to face the bull market we are in currently . A particular stock. Caller i was wondering what your take was on shopify. They make the quarter, they make the quarter, and they make the quarter. Theres got to be some flyers on this one. Is it amazon . Nothing is amazon. Nothing is amazon. Raymond in california. Caller booyah, from the san fernando valley, california. My question to you is on fit bit, a little over three months ago, there was an article where United Health group was offering and just a couple of weeks ago, they came out with a commercial for the wearables device. Given this level of exposure, do you see other investors catching on to this trend. Fit feels like jcpenney, it just feels like theyre 80 cents down and two bucks up. I dont know what gets it there. But i think youre right in terms of the riskreward. Fit seems right when it comes to riskreward. As we head into retail earnings which starts tomorrow. Some of these stocks are oversold. Especially kohls. It could rally if we get positive news, either home depot or target. Probably the former over the latter. I talk to with the ceo of magellan mid street. But its in the red so far this year, it seems wrong to me. But todays jump in oil companies, could the company see its earnings rise . And do you know that 60 million americans spend money on their dogs every year. Can it keep climbing or are you barking up the wrong tree. And then well have a magical edition of the lightning round. So stick with cramer. Whats better than mad money . How about more mad money . Follow mad money on facebook, twitter and instagram to go oneonone with cramer. What other questionses do we have . I always tell people you have to start with an indexed fund, because i need you to be diversified. And go behind the scenes with the most interactive show on television. If you cant explain in three bullets why youre buying a certain stock, dont buy it. Follow mad money today. Stay with me, mr. Parker. When a critical patient is far from the hospital, the hospital must come to the patient. Stay with me, mr. Parker. The at t network is helping First Responders connect with medical teams in near real time. Stay with me, mr. Parker. Saving time when it matters most. Stay with me, mrs. Parker. Thats the power of and. Welcome to holiday inn thank you wait, i have something for you making every stay a special stay. Holiday inn, smiles ahead. Whether for big meetings or little getaways, member always save more at holidayinn. Com a used car, today were unleashing American Energy and clearing the way for thousands and thousands of high paying american jobs. The words focus on American Energy, translate into profits for an industry that can suffer from some crude price swings. This is a good day for the price of oil, four in a row. But i believe crude willikely stay stuck, bouncing between the mid 40s and the mid 50s for the foreseeable future. Because theres so much good supply in this country keeping a lid on prices. This is one of the most Pro Petroleum president s in history. We got volume aplenty. However its not easy owning a Pipeline Limited partnership. Take Magellan Midstream partners, a pipeline operator. I like magellan so much i own it in my travelers trust. Unfortunately we have seen the stock down 9 from its 52week highs. That payout becomes a lot less attractive when investors believe Interest Rates will keep rising, the whole pipeline complex also tends to sell off along with oil, even though magellan is a toll road operative for. Magellan delivering a nice top and bottom line. The stock barely budged on the news. With crude climbing again, could the pipeline Magellan Midstream partners, mr. Meres, welcome back to mad money. Have a seat. Glad to be here. Were trying to explain to people the relations between an oil pipeline and an Oil Storage Company and the price of oil. And all i can tell is that the more oil we take out of the ground, the better its going to be for you. Thats true, were well positioned for the permian basin. We have got two pipelines out of the basin, were looking at building another one, we have contracts on the pipelines we have in place. It doesnt vary with the fluctuation of the price of oil and we have plenty of capacity on existing pipes and we have potential to add pipes to the permian. Lets talk about that, because i know youve been talking about the potential for a half a billion dollars worth of projects. Its really in the category of consistent. Most of our projects are long lead line projects, many of them need customer commitments which take time to secure. But once we have them, theyre very solid projects, we have a number of crude Oil Pipe Lines and we have a number of Refined Products opportunities also. When we hear that the u. S. Government allowed us to export u. S. Crude, thats also a win for you . Absolutely. As Light Oil Production grows in this country, its going to surpass the capacity to consume. That oil has to go to the export market. So its given us opportunity to build infrastructure, were building that in houston, were buiwere how much of it is not a toll road . How much of it does have commodity exposure. About 19 of our company is fee based. And about 15 is on thats not a money losing proposition, really, in any circumstance. Theres always money to be made there, it just fluctuates from year to year. You have a noincentive distribution rights strategy. And this is the one that is best for shareholder, if you could just in english explain what that means and why its so much better if youre a shareholder of magellan . When Many Oil Companies were formed, the general partner which has a small equity stake in the partnership, gets up to half of the cash flow over time. And obviously thats a drag of cash flow, youre investing capital, half of that is going to somebody else, only half of it is going to the public market. We dont have that draft, 100 goes to the shareholders. Youve been doing a lot, youve got saddle horn from the rocky mountains, youve got a lot of different thing going on right now, which of these are the big can be a kind of a fulcrum to take things higher . We have three focus areas for growth, one of those is additional crude oil pipelines, were looking at expanding out of the permian down to corpus christi. The other one is crude exports. Were building another one in corpus christi. As we have so much abundance of cheap crude in this country, refiners are going to continue to run, and theyre going to export that. Who takes it . Who needs our stuff . The world market. And so youve got needs in asia, youve got needs in latin america, youve got sometimes the needs in europe. Your consistency is remarkable and i think that right now 4. 7 yield is pretty darn good, im going to continue to add the position from my travel trust any time i can. This is the most consistent one. No distribution rights means that youre in the drivers seat. Mad money is back after the break. [vo] when it comes to investing, looking from a fresh perspective can make all the difference. It can provide what we call an unlock a realization that often reveals a better path forward. At wells fargo, its our expertise in finding this kind of insight that has lead us to become one of the largest investment and Wealth Management firms in the country. Discover how we can help find your unlock. It is time for the lightning round. [ buzzer ] and then lightning round is over. Lets start with joe in new jersey. Joe . Caller hey, jim, im a first time caller and i would like to ask you about abbvie. I think this is one of the finest Drug Companies around, bye, bye, bier. Lets go to danny in georgia. Caller what about qualcoca went higher today, i think it can go even higher from here. Lets go to allan in washington. Caller im in the land of russell wilson. The commercials look greet about him. How can i help . Caller im an exphiladelphiian now living outside of seattle. My question is, i owned enbridge. I would go to with magellan. Lets go to peter. Caller my question is about tvg ooir cvbi. The sector is turning around and i think you got a good play on it. Caller im Holding North American tanker. I have not liked this company for a very long time. They keep buying ships and thats just a mistake. I do not want to own nordic american tanker. Caller booyah, jim. Question, what is your stance on epd. Its a very good partnership, it yields 6 , i think its in very good shape, its got a good balance sheet. Lets go to pat in maryland. Caller i bought nbr on friday. With a 6 gain. What should i do now . Caller just walk aw. Just walk away, i am not in favor of buying that. Caller im a long time owner of ford, i cant figure out why its number one in production and sales in the country. Because its going to have a down year, the company has even said that, they have not encouraged you to wire as far as im concerned. And ladies and gentlemen, thoat is the conclusion of the lightning round. Thats a great idea, but why dont you just go to thinkorswims chat rooms where you can share strategies, ideas, even actual trades with market professionals and thousands of other traders . I know. Your brain told my brain before you told my face. Mmm, blueberry . Tap into the knowledge of other traders on thinkorswim. Only at td ameritrade. You know im a big believer in identifying powerful longterm themes and sticking with them for years, as long as they keep paying off. Right now one of the hottest things out there are immunization for pets. Zoletta as the Global Animal Health company thats focused on livestock and pets. They have had a 13 gain versus where it was trading just a month ago. While it took about a year for the company to find its footing, as i told you it would. Ever since this company has been on fire. 5 cents earnings beat, up over 6 year over year. But even up here with the stock only a few nickels away from its alltime high, i think it could have room to run. Lets talk to the ceo of. Theres a deal we made thats in the news, the cattle with the chinese. Some of the work youve done to make our cattle the safest in the world. For our customers, farmers in the u. S. Now they will have access to the chinese market. The chinese have significant potential. Theres a lot of people there. Theres more growth in consumption of beef, will be very important for the cattle business in the u. S. You have done a lot of International Work with vaccines in china since i have seen you last. It sounds like that market has become a great growth market. China is growing very fast. We have a lot of vaccines for companion animals and livestock and we do believe that china will be an important market, its already an important market for us. You revealed that some of your medicines for dogs would take off. I was shocked to see the market share, your Atopic Dermatitis drug already gotten. How did that happen . That drug is responding very well to the needs of pet owners, its also not only leading in s but innovation. Its two options for treating allergies in dogs. Were very pleased with all the products we are making. Its very clear that this is a superior drug to the steroids that we give our dogs, right . Thats just without a doubt, superior. Its better efficacy, its faster, because in very few hours you have relief of all these itching conditions and theyre very important. You dont see the side effects that you see with steroids. This acquisition, this intrigued me, because we care tremendously about our dog, we dont know if our dogs are in pain, we can look to see if they are. This is a very serious chronic pain possibility for you guys. How do we know that dogs have it. Dogs, when they are quiet, when they are not moving, its a good sign that there is pain on the animal. So the best thing is take the dogs to the veterinarian and the veterinarian, they have the tools to identify what will be the best course of treatment for the pet. This could be a gigantic drug, we care so much about our dogs, we cant talk to them, but we would do anything to relieve them of pain. Using pain, because also, we expect that the side effects reason fewer than instead of the other medications that are already in the market. The other opportunity will be not only dogs, but also cats. Because cats today, there is not available for cats, which is working well. This will be an injectable formulation, and it will do very well with injects cats with painful conditions. You are a very high taxpayer, if there were ever a change in the income tax, it would be a boon for the company. You have been so pro shareholder. We define the capital location for us, first is invest in the business, so we have scene a significant return in investing in research, investing in commercial. In manufacturing, these are the focus that we have today. Genetics or biodevices. We bought skacandinavian microbiologist office. You have to be satisfied that if President Trump gets this through, it would be very good for the company. It will significantly increase our profitability. We are improving that profitability. Because 400 basis points in 2016, good improvement, now we have 32 margin, which is very remarkable. We have plans to keep growing the margin, but the help of the tax reform, we also have a positive effect on our operation. You have done exactly what you said you would and thank you for everything youve done for shareholders. Theyre just doing fabulously. Stick with cramer. The new guy . What new guy . I hired some help. He really knows his wine. This is the new guy . Hello, my name is watson. You know wine, huh . I know that you should check vineyard block 12. Block 12 . My analysis of satellite imagery shows it would benefit from decreased irrigation. I was wondering about that. Easy boy. Nice doggy. What do you think . Not bad. shouting more power tools. More power suits. shouting more power. Chords. With customized Loyalty Programs and datadriven insights, Synchrony Financial can help bring more. Power to your business. Were getting a lot of reports about what Hedge Fund Managers have bought this quarter. And i am urging you to take zero action on these. You have no idea why they bought them, you have no idea if theyre going to sell them. There have been so many mistakes made by investors at home saying, wow, that Hedge Fund Manager has given me his blessing to buy. Untrue, dont trade off of it. Theres always a bull market somewhere, i promise to find it just for you, right here at mad money. Im jim cramer and ill see you tomorrow. You want to know to trust you with their money . Ill tell you right now. You present it as an exclusive thing. Look, what can i tell you . Its a closed fund. An elite club for the chosen few. Its not a question of credentials. Right now, its a closed fund. Of course, thats just the hook. Nothing on earth makes people want something more than telling them they cant have it. You play hard to get. You make them sweat. And then. Im gonna make an exception. And once theyre in, you make them feel safe. You give them consistent returns, around 10 , 12 a year, year after year. If anybody asks you, how do you do this . Whats your secret . You say to them. Thats proprietary