tv Mad Money CNBC February 25, 2012 4:00am-5:00am EST
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i'm jim cramer, and welcome to my world. >> you need to get in the game. >> firms are going to go out of business, and he's nuts! they're nuts! they know nothing! >> i always like to say there's a bull market somewhere, and i promise -- >> "mad money." you can't afford to miss it. hey, i'm cramer. welcome to "mad money." welcome to cramerica. other people want to make friends. i'm just trying to save you some money. my job is not just to entertain you but to educate you. so call me at 1-800-743-cnbc. today we saw what happens when this market's two big cross-currents cancel each other out. i'm talking about the seemingly inexorable rise in oil. that's like a gun at our backs. and the almost really unexpected rise in the euro. which could put the wind back in a lot of companies' sails. today oil ticked up another 1.87 on the fxe.
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our key measure of the euro which no one's even talking about anymore, all climbed 93 cents to $134. remember, higher oil means a higher price at the pump whenever you fill up your gas tank, and a stronger euro means higher earnings for all sorts of multinational companies that do business in europe. so even though everyone else has forgotten that we're focused on, ideally we need oil to go down and the euro to go up. but when they both go up we get what happened today, where the averages meander around and do very little. dow closing down two points. s&p gaining 1.7%. nasdaq rising 2.3%. they canceled each other out. what's the game plan for next week? first, on monday after the close we get our momentum checkup when priceline.com reports. could momentum investing be making a comeback? have you seen this stock? we saw people willing to pay for excellent execution from salesforce.com. mastercard, symbol ma, and intuitive surgical will continue
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to make new highs. so how about priceline? i mean, this is a rocket, but is traveling being hurt as higher gasoline prices lead people with less discretionary income to go on trips, or do tourists, particularly european tourists, flock to priceline in harder times in and is william shatner really out as the spokesman? paging mr. spock. we also might get some insight monday into how low natural gas goes when we get results from southwestern, swn. we heard from mark pappa this week, the ceo of eog resources that nat gas could go appreciately lower. southwestern is the premier gas companies in this country. will it share in the negativity, talk about cutting back on drilling or will most importantly talk about using natural gas as a surface fuel, something that this show tonight is focused on in order to save what i think is the american consumer from the possibility of forever higher gasoline prices? we have the ability to stop that. few companies know more about the nat gas business than southwestern. so i'm going to be listening to every word, and i'll give you the skinny. tuesday morning brings us the remarkable story that is auto
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zone, a play on the desire to keep your car for longer at a time when the average car on the road is 11 years old. now, auto zone produced some of the best performance i've ever seen from a stock. augmented by one of the few buybacks that have really done the job, dramatically shrinking the share cap and thereby making the earnings per share bigger. i think it's still all systems go and you can still get into the zone. all right. now, we're going to find out about domino's pizza, whether it can continue its winning streak. the stock's been stalled since the last time it reported but i expect an earnings beat and further adoption of the domino's mobile app. i also want to hear about their expansion into india, where the vegetarian nature of the market is a tail wind for this fabulously run company. i do want domino's iphone app to offer a no-cheese option like the traditional desktop pc version, or else it's a non-starter for me and my daughter. and i use the baseball sounds as my background when i order. what do you use? after the close one of my favorite master limited partnerships reports, mark west. is it as sexy as salesforce.com and benioff? i don't know whether benioff's
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sexy or not but he's a good guest, isn't he? i want to keep this group in front of you because it's still offering sky-high yields with a good risk reward. wednesday we get our results from costco. you know -- hey, i was once on the cover of costco magazine. anyway. say it ain't so. jim sinegal's no longer the ceo. new executive rich galanti will be doing the honors. i want to know if they're passing on the food inflation or electing to eat it in order to continue wooing customers with lower prices than the other guys. how about their gasoline biz? have they priced that pass on too? so much to ponder here. and the stock has fallen behind the group. now, joy glowing reports on wednesday too. talk about topical. lately i've been worrying a lot about the demand for coal. remember i said to get out of consol? ripple effect on fuel and natural gas. has it hurt joy? also should we be jumping from joy, not for joy? gunning for them with its highly competitive bucyrus suite of mining products especially in china. i'm sure the straightshooting
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ceo michael sutherland will let us know. we're going to also hear from staples on wednesday. i usually don't talk about staples as an earnings play. i don't even want to know whether the company beats the estimates. you i just want to know what they say about small business growth. that's still a weakness in our economy. so we need to find out whether this quintessential job-creating group, whether they're back or not. staples going to tell us. thursday kroger. now, you know i'm a whole foods guy. when i'm not a trader joe guy. and i think whole foods, really all the other publicly traded supermarkets, they pale in comparison to wf. but kroger, giant supermarket chain that has been under pressure from food deflation. so we've got to hear what they say about the consumer and whether they're trading down to private label because that's been a continual theme of the show. whether there's an appetite for passing on price increases. and whether people are spending more time dining at home because
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of higher oil prices. we're keeping this higher oil theme in front of you all the time. finally, after the close on thursday, foot locker. we got a terrific upgrade of under armour from morning stanley. i really like this report. what i find most compelling about the ua is the analysts said that under armour is taking share from nike in the once uncontested footwear business. i like under armour for its technologically savvy apparel but i want to hear how their shoes are doing from the source, and the source is foot locker. beyond earnings i think it's good to get shares in yelp the ipo that comes next week. it operates a local business view site. 66 million users a month. you know how hot these web deals have been. they're smoking. listen to me. do not buy any yelp in the after market. and if we get a huge first-day spike you need to follow in the footsteps of the steve miller band. take the money and run. please do not be a joker, a smoker, a midnight toker or maurice for that matter. there's more to this market than oil's endless march higher and we need to see continuous strength in the euro to offset the gasoline-induced gloom. and even without an assist from
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europe i think the companies reporting next week will paint a pretty darn good picture of the economy, one that is resilient enough not to be crushed by expensive gasoline prices. now i go to fred in pennsylvania, please. fred. >> caller: boo-yah to you, jim! >> holy cow. what's up there? >> caller: carl icahn wanting to purchase and take over cvr energy as well as the holdings of uan, which is cvr partners, how is that going to affect me? >> i'm not blessing it. you should be a register ringer. i don't think there's much more money to be made there. and i think there could be a house of pain if you stick around. >> the house of pain. >> come on, man, you've got to get some horse sense and ring the register. let's go to scott in my home state of new jersey, please, scott. >> caller: hey, mr. gps of wall street. boo-yah, cramer. >> well, terrific, as long as you don't mean gap stuart. boo-yah back at you. >> caller: i noticed the cheesecake factory recently has strong earnings and has had consistent earnings over the past two years. i'm concerned that there's no dividend to go with this, only stock buybacks.
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i've been to this restaurant several times, and it has been packed. what do you think of this stock in. >> i agree with you in terms of the packed nature of the place. particularly -- you know what? they have a low-fat -- i know it sounds like cheesecake has a diet menu. but they do. it's not an oxymoron. however, the quarter was not good, sir. it was not good. and it is now one of my lesser favorites stocks in the restaurant group. remember, we remain buyers of panera and chipotle, particularly on weakness, and we're all over mcdonald's and yum. kfc is best in show. how about mike in illinois? mike. >> caller: boo-yah, jim cramer. >> boo-yah, mike. >> caller: boo-yah. jim, i and all chicago think you rock. >> really? >> caller: yes, we do. >> holy cow, that is a city where i am going to catch some ball games this summer. that is my goal. my goal is to get to a white sox game and also to catch the cubbies. >> caller: listen, jim, after yesterday's speech of obama pushing for alternative energy.
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>> right. >> caller: i bought a stock, usg. united states natural gas line. >> ung? no, no -- you mean -- oh, the natural gas -- the limited fund? >> caller: umg, united states national gas fund. >> yeah. you know, that's an etf that i've been very much against. i think you olt to pick up a copy of "getting back to even" and you'll see exactly. i have a real very negative picture painted of that. if you want natural gas -- oh, i'm sorry. i'm sorry to cut you off. go ahead. >> caller: my question is i paid $5.15 for it last week, and wednesday i bought 1,000 shares of it and wednesday it went up to $22 per share. and they lowered my shares down to 250. what's going on with that? >> what, did they do some sort of financial shenanigan there to get that going? i didn't know they did that. i just have to tell you that i don't want you in that. it is not a good place to be. if you want -- if you want to play natural gas, i'm going to
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suggest you buy conoco, which has natural gas and oil and a yield. and that's what you need. okay. the rise in oil, it's like a gun to our backs. but there's more to this market. i think the companies who report next week are going to do a pretty darn good job. boy, i've got to tell you, i think it's a week where we're going to find out a lot about the economy that people aren't expecting and it's going to be pretty positive. stay with cramer. >> announcer: coming up, tensions in the middle east. speculators gone wild. oil prices soaring. what does it mean to you? >> skyrocketing gas prices. >> rising gas prices. >> gas prices are at the highest levels ever for this time of year. >> announcer: pain at the pump. cramer's got the alternatives. >> we're launching a program to figure out how more cars can be powered by natural gas. >> announcer: tune in for some ways to fight back on fuel profits. don't miss jim's exclusives with the engine maker westport innovations and clean energy fuel's ceos just ahead.
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with the already sky-high price of gasoline rising inexorably higher, will this country finally do the right thing and embrace natural gas, our cleaner, cheaper, and ultraabundant domestic energy source as an alternative, one that can be used to fuel trucks and thereby replace 25% of all the oil we import. yeah, it goes to diesel for trucks. i've been skeptical because we've seen inaction on this for years. but yesterday the president said this. something that may sound familiar if you're a "mad money" viewer. >> we're launching a program that will bring together the nation's best scientists and engineers and entrepreneurs to figure out how more cars can be powered by natural gas, a fuel that's cleaner and cheaper and more abundant than oil. >> i'm not sure, but the market seems to think so.
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that's what i take from the stratospheric rise in westport innovations, wprt. the leading maker of natural gas-powered engines, especially for heavy-duty trucks. westport's long been one of my favorite speculative plays on nat gas vehicles. lately the stock has soared through the roof shooting up nearly 20% year to date. 263% since i first got behind it in january 2010. while the economics of this business have never been better for westport the company, nat gas at nearby all-time lows, gas price as boff $4 a gallon, going higher, some people are starting to about westport the stock. on wednesday westport priced 5.5 million share secondary offering at $3.25. and yesterday jpmorgan downgraded the stock to a sell in large part because they think it's gotten too expensive at these levels but also because they think there's competition coming and the addressable market might be smaller than some believe, including me. i think these are legitimate concerns, which is why i'm thrilled to have david demers and a new model of the natural gas engine behind me. david's the founder and ceo of westport innovations. he's here to talk to us tonight about his company and where it's
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headed. mr. demers, welcome back to "mad money." >> hey, jum. >> good to see you, sir. >> great to see you. >> what do you think? >> i've got to tell you, the first thing i have to say is if the addressable market is small like jpmorgan is saying, then what the heck are we doing with maybe the best-selling truck in the history of the country running natural gas? >> i think we can do anything. what kind of car would you like? we'll do it for you. you know, we think this is going to be a great product for people that are running around the oil patch of course, but it runs on gasoline. it runs on natural gas. take your choice. maybe we'll see some here in new york. you never know. >> show me. because you know, i think a lot of people are confused. they either think, hold it, it's natural gas, i'm a dead man because i'm stuck in some town that doesn't have it or it's gasoline and i wish i can have natural gas. how does this work? >> this is a product we've been developing with ford for some time. but what people have a lot of anxiety about for something like a pickup truck is where am i going to refuel?
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this is a truck that can run on gasoline or natural gas. so you've got two fuel systems, two fuel tanks. you can refuel with natural gas. you can refuel it with regular gasoline. >> a lot of my friends say wait a second, there's not enough room in a trunk if you put nat gas tanks in it. >> this is a natural gas tank. you see it takes up a little bit of room in the back. but this is what gives us 600-mile range. we haven't taken out the gasoline tank. if we wanted to get rid of this tank, it wouldn't take up the room but you wouldn't have the flexibility. we have to find some space for it. this fits in pretty nicely and gives us a nice space to put the cng logos on the side. >> president in his speech yesterday directly mention td wasn't the job of the government necessarily to give money to any particular technology but it was to promote. this would be a natural engine i would think for the military. i would think for the post office. right? >> no, it's going to happen. we're going to see it in locomotives. we're going to see it in shipping because anybody that uses fuel is really excited about the opportunity to use a domestic resource that's going to cost them a lot less money. it's really simple.
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so what we have to do is work with people who make vehicles like ford. we're going to launch this pickup truck with them in the second quarter. it will be made in louisville just like the base gasoline trucks, delivered to the ford dealer. we can do this with any vehicle and with any partner. we just need to get it organized and get on with it. >> earlier this week big deal announced, next iteration of your deal with cummins, largest truck engine manufacturer, one of our absolute favorites. they're talking about actually making the truck in the united states for mass consumption over the next ten years. how important is that deal to westport? >> well, we always want to see reusing the production assets. part of the problem with alt fuel vehicles, and people have tried all kinds of things, but the problem is scale. how do you start from zero and get it to reasonable scale? because if you're not doing large-scale production it's going to cost too much. and so part of what we've tried to do here is say let's make a truck, let's make a vehicle that's on the same production line. let's make engines on the same production line so as a result it's really easy to scale up and it's a relatively modest investment. and we can grow from there. but we certainly don't want to be small scale forever. so what cummins is going to help us do is get that scale.
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>> let's talk about the scale because this jpmorgan heresy report here, everybody's entitled to their opinion unless i can give it to all of them. each fuel will likely be used only in niche applications. the niche -- you know, they're basically saying cramer, don't get carried away, it's not going to be that big. and there is no yet -- there's no payback yet. in other words, that when you look at the actual economics of a trucking company switching it's -- because they have a fuel surcharge, trucking companies, they don't really get hurt by the high price of diesel, it's perceived. but wouldn't this be a great opportunity? i saw that one of the big truckers has just said we want to go full bar with this. even though they have a fuel surcharge, it's still economic if they want to take share away from the other guys to go with nat gas, isn't it? >> you might say that they don't care about fuel price, but their customer sure cares about fuel price. if there's another truck fleet that shows up and says, hey no, diesel surcharge, who's going to win the business? so i think everybody has a concern with energy costs, and if you're transporting people or goods, ultimately someone has to
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pay for this energy. if we go to a cheaper energy source it's going to naturally win the business. >> the other day chesapeake, a very forward-looking company, teamed up with 3m of all companies to try to find tanks, cheaper, that would lead to quicker payback. where are you in that -- >> we're working with lots of people. there's a massive amount of innovation going around the world. it's a global problem. everybody's going to try to solve these issues. i'm sure that's what the president is talking about with innovation. lots of things we can do in a world where we're focused on natural gas as the fuel. can we do better engines? better vehicles? everything can get much, much better if we have the market and the market demand. so all of this stuff is coming. >> you mentioned it's coming. one of the reasons i'm focused on jpmorgan, i'm not trying to beat you up on this stuff but people are saying wait a second, cramer, it's too much, putting the onus on me. jpmorgan is saying come munz is going to be free to compete with you and more importantly there's much, many more competitors coming in. i to date have seen you line up
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navistar, seen you line up volvo. i'm trying to find out who's this fast competition? >> i'm not sure where the competition comes from, either. >> i mean, you started this. you even said it was niche environmental is what got you started, right? >> mm-hmm. what's happening is everybody's seeing their customers talk about it. so what's driving the interest here, it's not the oems' vision necessarily. it's customers saying i want a natural gas vehicle. a truck like this is coming because the people who are running around at chesapeake or in kenna are saying we need to run our trucks on our own commodity, why are we buying someone else's oil when we're producing natural gas? well, that's the kind of thing that really gets the automotive companies excited. if we can find a market where people want to buy these things, maybe the government fleets are going to buy these in places like pen where they're producing natural gas. so the market is coming. people are going to create the
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product. and we're there to help the oems do it in a cost-effective way and scale it up quickly. >> on monday warren buffett, "squawk box." okay? one of the great visionaries of our time. he owns burlington northern. berkshire owns burlington northern. union pacific, largest user of diesel in the world. so i'm sure burlington northern's not that far. have you made the pitch to burlington northern and warren buffett, who happens to also be one of the largest owners of natural gas pipes in this country, have you made a pitch that he he should switch burlington northern engines from -- >> yeah, i think you've seen this announced, that we're doing a locomotive project with cn rail. and this started out really as a science project less than a year ago. >> like i did -- >> we're going to prove it's possible, prove it's feasible. can we look at this energy source for locomotives? because they burn tremendous amounts of fuel. now, what happened in he is-d emd, one of the largest manufacturers of diesel locomotives, has joined the product. we're going to make a commercial locomotive out of this project. we'll have it on the rails next year. so i think we're going to see everybody say how do i get this cheaper energy source.
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>> i think it's a big market, not a small market. i don't think there's anything niche about this, and i think it is very competitive if not more competitive than anything when it comes to diesel and cleaner and abundant. thank you to david demers. this is the ford 250 with the westport wing power system. i bought a ford 350 a couple months ago. i've got to tell you, i might have gone with the wrong truck. good to see you, mr. demers. >> thanks, cramer. don't move. we've got the company that can actually fill this truck up with nat gas. can these gas stations of the future fill up your portfolio? cramer's exclusive with clean energy fuels' ceo is next.
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call the number on your screen. for years, literally for years i've been on a crusade to get lawmakers to embrace natural gas as a fuel for vehicles. hey, listen, we've made some money on this one. it's a 30% cleaner than petroleum fuel. it's a heck of a lot cheaper than gasoline or petroleum to diesel. and it's so abundant here in the united states question we generally don't know what to do with the stuff. which is why natural gas producers across the country are scaling it back -- they're burning it off when they drill for oil. they've got that much of it. but for years this argument has fallen on deaf ears, congress can't get its act together to do anything. the president favored battery powered electric vehicles. until now. price of oil soaring to sky-high levels while natural gas languishes near record lows. 40-1 ratio with diesel. washington seems to be waking up to the scale of this opportunity, get opec's boot off
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our neck by replacing expensive foreign oil with cheap domestic natural gas. president obama mentioned natural gas in the state of the union address and just when it was starting to feel like it might have been a one-off thing, two days later he spoke at a understand package facility with a clean energy fueling station right behind him. then he came out yesterday at the university of miami, talked about getting more cars to run on my favorite fuel. this could be good news for cramer fave speculation clean energy fuels. they're building out a nat gas superhighway, long our nation's major trucking corridors. plus even without government intervention lots of private sector players are working to the make match gas more of a reality. clean energy's run up a lot lately, 55% since we spoke with the ceo last november. don't be greedy. but lately it has seemed to established itself as a permanent resident on the 52-week high list. let's talk about somebody who's taught us a ton about it, andrew littlefair, the co-owner and ceo of clean energy fuels.
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welcome back to "mad money." >> good to see you. >> good to see you. i know you saw the parking lot. we just talked to westport innovations and they had a ford f-250. i'd always thought this fuel was going to be a heavy-duty truck fuel. >> well, it will be heavy-duty truck fuel. but i tell you what, for fleet vehicles -- jim, we've talked about this before. in europe there are 62 makes and models. so i'm very proud of westport and their relationship with ford. we have a company that does the same thing as well. you're going to see it in all the pickup trucks, in the vans. you'd be surprised. you know gm's beginning to come along. ford's coming around. so you'll see it start with the fleet vehicles, but it will move eventually into the light duty passenger vehicle. >> a lot of people are in disbelief, but there was a time when trucks used just regular fuel and they switched to diesel. >> right. this has happened before. >> this has happened, right? >> yeah, and it sounds funny as we sit here today, but it was really in the early '70s. and it happened in about a
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six-year period. it went from gasoline to diesel. >> people were in disbelief then. they're in disbelief now. >> it happened because of the economics. the same kind of economics we have today. >> there are some people saying to me jim, you're a dreamer, the payback is not nearly as good as you think because of the fuel surcharge. it really doesn't pay. unless these trucking companies are given money, they're not going to do it. >> it's not true. for a heavy-duty truck there's an announcement, navistar and cummins westport. for a heavy-duty truck the incremental's about $35,000. >> okay. >> they use 20,000 gallons. >> right. >> a year. they save a buck and a half a gallon or more. so you get a one-year payback. >> one-year payback. >> and yesterday aubrey mcclennan, ceo of chesapeake, announced with mr. buckley at 3m the possibility of taking the last big i think stumbling block, which is the cost -- what would this mean? >> okay. so this is for cheaper tanks. cheaper cylinders for compressed natural gas. you know, today in a heavy-duty trash truck on natural gas the natural gas engine today is cheaper than the diesel engine. but what costs the extra $15,000, it's the cylinders. that's going to come down.
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>> okay. now, we had mr. steiner sitting here a couple days ago, ceo of west management. every new truck -- >> it's amazing, isn't it? >> republic, too. they're switching out of diesel. >> so this year 80% of all the waste management new truck purchases are natural gas. you know, in 2008 it was 3% industrywide. this year it's 40%. and waste is leading the way with 80%. and republic, 65% of new purchases. it's happening. >> there are some saying it would have been better for you to wait until these big -- until it took off. but they -- it can't take off until you finish your -- >> you know what we're trying to do is build out. we're building like crazy for
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these refuse trucks. >> how many are you building this month? >> well, this year we'll build 140 fueling stations. we'll build 75 of these truck stops this year. right now we have 18 under way. i mean literally ground being built right this moment. by the end of the year you'll be able to go coast to coast, border to border, down the i-40, the i-10, the 90 on the east coast and the i-5. so really we have the reality you'll be able to move goods across the country on natural gas. >> i was trying to break down the value of sunoco, philadelphia company. grew up there. and the gas stations weren't worth that much. why is a clean energy gas station going to be worth a lot? >> today -- we have to talk about this a lot. today our margins are relatively fat compared to the mature business of gasoline and diesel. we have larger margin. but remember, we're competing against diesel at $4. >> right. >> our commodity per gallon is about 35 cents. now we have to put another dollar on it. but really you're getting at the nozzle at about a dollar and a half and you're competing
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against foreign dirty oil at $4. >> okay. now -- >> per gallon. >> right. no, it is -- >> we're going to get to have a little bit better margin than the mature business with the imported fuel. >> and is one of the things working in your favor let's take a company like exxon, they pay top dollar for xto. it was a vast overpay. they are so committed to their existing gasoline stations i guess they can't do what you do. >> look, someday i think some of the majors will do this. all right? >> you're talking about shell doing it -- >> yeah, maybe. i don't think it's going to be in our business, the heavy-duty. because exxon and shell, they don't fuel the trucks. if you took the natural gas at exxon, the xto at $2.50 and you put it in the gas tank it's like 16 bucks at mcf. think about the upgrade of the resource they have. and eventually they're going to do this. >> you know they're going to do it. but you will have built out already. they should just go by buy pu you. but that's a adifferent story. mark pappa is saying nat gas is still not done going down. could go to $2. could we figure out that you actually make money now, every ten cents down nat gas would be looking at clean energy.
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>> i healthy to see this with my friends aubrey at chesapeake. i hate to see natural gas keep going down. but we enjoy that, of course. >> right. when i see nat gas go down, that's you. that's your margin. and that's the way we should think about clne, aside from the adoption and all another business. >> that's right. >> 52-week high doesn't lie. >> we're working at it. >> that's andrew littlefair. he's the ceo of clean energy fuels, clne. stay with us. stay with cramer. thank you, andrew. good to talk to you. >> coming up, ride the lightning. take a nonstop thrill ride as cramer goes stock after stock. all your calls taken rapid-fire on the "lightning round." and later, send cramer an e-mail to madmoney@cnbc.com. or tweet him at jimcramer hashtag tweetlikemad and he might just answer you on the air. on an all new edition of "mad mail." all coming up on "mad money."
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round" on cramer's "mad money." what's that about? rapid-fire calls one after another. you say the name of the stock i tell you whether to buy buy buy or sell sell sell. my staff prepares the graphics on the fly. he play until we hear this sound [ buzzer ] and then the "lightning round" is over. are you ready, skee-daddy? time for the "lightning round" on cramer's "mad money." sandra in florida. >> caller: hi, jim. boo-yah to you. >> boo-yah, sunshine. what's on your mind? >> caller: i am watching the ocean and thinking of you. >> ah. i like that image. because it's really nasty out here today. what's up? yucky. >> caller: listen, we want to thank you, first of all, thank you for all that you do for us. >> thank you, sandra. >> caller: and for your books. and keep them coming. >> thank you. and i will. i will do just that. >> caller: my stock is cellcom israel. >> feels like the french telecom when they finally cut the dividend. i am worried. i'm going to tell you, no, danke. let's go to john in michigan. john. >> caller: captain cramer.
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great lakes boo-yah to ya. >> man, sweet. what's on your mind there, partner? >> caller: onty. what are your thoughts? >> i'm willing to speculate on a lot of biotech, but you've got to have some revenues. the zero -- no. this one is actually too out there even for this guy. let's go to richard in minnesota. richard. >> caller: yes, hi, jim. >> richard. go ahead. you've got the floor, my friend. >> caller: yes, i'm sorry. what? >> you're ready. what's your stock, rich? >> caller: did you get my question? >> no, i didn't hear it. why don't you give it to me again? >> caller: yes. right. wondering if you're still hot on goldcorp. >> that was actually the best -- other than maybe rand gold the best quarter we saw in the group. i think gg, i think he's a buy. i like the gld even more, though. let's go to paul in my home state of p.a. paul. >> caller: ba-ba-ba-boo-yah from the poconos. >> i love that stuttering boo-yah. interstate 80 guy. looking for a place in homesdale
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for two years. finally gave up. what's up? >> caller: recently came into a little bit of cash unfortunately. and was looking at how you're always saying we've got to change our ways here, jim. you're a little concerned about sandridge buying up everything and kodiak maybe being in the same sweet spot. i was wondering what your options or what your suggestions would be, invest in maybe a small portion of my portfolio in a speculation -- >> i'm willing to go with sandridge now after last night's quarter which was quite good, frankly. they did a very good job. tom moore did a good job. and i've got to tell you, i think that could be something worth buying here at eight bucks. let's go to john in nebraska. john. >> caller: jim. boo-yah from the home state of richie ashburn. >> whitey. man, i miss whitey every day. always think of him in the booth. >> caller: quite a philly. >> yeah. >> caller: jim, my stock is michael kors. >> stock has pulled back 6%, 7%. that is off the terrific level to get in. i'm going to tell to you buy kors. that is not the beer.
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i will have a coors tonight. but i'm telling you to buy kors. let's go to charles in north carolina. charles! >> caller: boo-yah from north carolina. >> yo. man, we were just talking about the unc team. what's going on? >> caller: i'm looking for what to do with conoco phillips -- >> the answer is you buy buy buy. jim cramer on twitter, somebody said what stock would you buy right now? i said my charitable trust thinks conoco phillips is about to explode here if oil keeps going higher. c.o.p. that is for me. and ladies and gentlemen, that is the conclusion of the "lightning round"! after years of this kind of churning action of this crazy intraday volatility i think people, they got sick to their stomachs. kind of like a real bad roller coaster that makes you feel very
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uneasy. and not just the rides i threw up on like scream at magic mountain or apollo's chariot at busch gardens or, yeah, even the carousels at sesame place. you wonder why i wouldn't go on that new "harry potter" ride at universal, right? that darn thing's the vix of coasters. jamison in texas. jamison. >> caller: ba-ba-ba-boo-yah, jim. >> johnnie walker black boo-yah to you, my friend. >> paul in arizona. paul. >> caller: greetings from the middle of nowhere, arizona. >> caller: boo-yah from hillsborough, missouri. >> hillsborough? [ crickets ] >> hey, there's a brand new american greet -- ya. that was good. >> all right. get fired up because there's a brand new "american greed" on tonight. i -- >> no music? i can't -- i need the music. why is there no music? >> there's a problem with the machine. >> well, we'll wait.
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♪ >> no music, guys. we're doing it without music. >> hey, get fired up because there's a brand new "american greed" on tonight. i can't wait for it. >> some people will do anything for money. >> some people will do anything for money. >> just want to see a billionaire from minneapolis. you don't want to miss it. wñwñwñwñwñwñwñwñwñososososvycyíy
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people are still going crazy for bonds. they're paying up for bonds at companies in a fashion that's just extraordinary. and also completely nuts. this morning my friend david faber pointed out how viacom, yeah, the tv company responsible for mtv, vh1, nickelodeon, that viacom, was able to raise $250 million in 30-year bonds at an astonishingly cheap 4.5% interest rate. these were unsecured bonds. that's insane. seriously, there's no way that anyone should ever reach for a 30-year piece of paper from a decent believer company when it
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pays only 150 basis points more than u.s. treasury bonds. risk-free, right? over a period where you have to believe that inflation could come roaring back or methods of television distribution could change radically and radically against viacom. frankly, if people really need it why not go with the common stocks that could boost their dividends over the next 30 years, giving me a fantastic return? stocks are so out of favor right now versus bonds that you're getting great bargains even in these high yielders and you don't have to go that far to behind them. consider you can get a yield of slightly more than 5% from a master limited partnership like kinder morgan partnership. distributions have increased year after year with the possibility of a boost to come. yet its yield is already above what you get from viacom's 30-year bonds. how about the stock of at&t and verizon? these companies have regularly raised their dividends and also yielded nicely more than that viacom piece of paper. or take the dividend aristocrat stocks. companies are so committed to the shareholders that they're likely to raise their dividends every year, going back for
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decades, with track records that are demonstrably better than viacom's. i'm talking about 3m, procter & gamble, i like that restructuring, or emerson. the rush for the 3w07bd market has to end badly given the rates they're pricing these corporate xwonds off of are artificially low courtesy of the federal reserve's endless attempt to get the economy and in particular the housing market back on track. while many people think the fed can only control shorter-term rates, the impact on the longer-term, the kind of rates viacom's taking advantage of, undeniable. i think anybody that buys this 30-year viacom bond simply has no understanding of the history of interest rates and how they can skyrocket after years of budget deficits that aren't aided by the fed. meanwhile, these buyers fail to recognize the ability of dopz reinvent themselves over a 30-year period and do the right thing by shareholders by returning capital their way in the form of bountiful dividends. my hat is off to viacom for getting this incredible bargain. however, i want to throw an odd job style hat at the buyers of this paper. i say they deserve a beheading.
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but that would imply these people have heads, something that has to be called into question given the high risk return of this 30-year high-risk piece of paper that ultimately might be junk. let's take a call. let's go to bob in mississippi. bob. >> caller: hey, jim. straight to the point. you speak of the importance of reinvesting dividends. i own at&t, which pays me a really good dividend, but i also own one of your favorite mlps that pays me an even better dividend. should i reinvest in the company that pays the dividend or pick the stock that offers me the best value? >> at&t's owned by my charitable trust actionalertsplus.com. because it's a charitable trust i have to give the trust away, give that part of the trust away. but kmr, kinder morgan, the r kind is the reinvestment dividend kind and that's a real great piece of paper. the name's bunt. viacom bunt. but i think you can get better yields elsewhere. if you understand the way it
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works those 30-year notes aren't worth it. take the cue from odd job. throw them away. "mad money's" back after the break. are you anxious to protect your family with life insurance ... but afraid you can't afford it? well, look how much insurance many people can get through selectquote for less than a dollar a day. selectquote found, rich, 37, a $500,000 policy for
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back on february 9th ed in new jersey asked me about cec entertainment, aka chuck e. cheese. where a kid can be a kid. cec just reported a solid quarter this week and sports a healthy 2.3% yield. but if you're looking for a restaurant turnaround story, uh-uh, not going to buy this one. company has a bunch of initiatives in the works but its same store sales are still in negative territory and that's a big no-no for me. i say forget cec and instead swap into some, wow, darden which i thought was a value trap but i'm now starting to think has a genuine inflection point. then on valentine's day glenn in north dakota, north dakota we love it, asked about oasis petroleum, oas. and we want to take a new look at this given the increasing price of oil. did you see the move in continental? oos oasis is a pure play on the bakken shale, the company has a lot of acres on land. i recommended a bunch of bakken
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names a year ago. since oasis has been lagging the others, rising a mere 4 is%. i know boo-hoo. but that's small potatoes next to the 81% gain in continental. that's my fave. my view now, if you value oasis acreage the same way bakken operator bxp was valued when it got acquired by stat oil for 4.7 billion in october, i think you get another 40% here. 40% more on a takeover basis. of course never buy anything solely because of the takeover potential. but oasis looks pretty darn cheap to me with oil trading where it is. and this at less than one time its growth rate. in an environment where i think oil can still go higher. i say it's a buy. also on valentine's day justin in new york had love for tango. tngo. but i want to do more work on this. see if the hype is the ultimate cloud play. so let's dance. tango's the market leader in the communications lifecycle business. what is, that some of exercycle? no, it's -- ibm, dell, and hewlett-packard. global presence, 180 countries.
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we love tango's ability to reduce telco spending managing devices remotely and handling device recycling. and while the company's been putting up pretty impressive numbers i've got to tell you this stock is too hot for me. 45 times earnings. 20% growth rate. i say wait for tango to cool off, give you a better entry point. our third piece of business also from valentine's day, that was a real stump the chump day. david from california asked me about prospect capital. pcsc -- pcec, like englewood cliffs. and i said i'd get back to him. i looked at this one before and this one i'm not going to pound the table forrar right here. a business development company, publicly traded private equity firm. lends money to invest in small private expects and yields a
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joout juicy 11% yield. however, prospect capital doesn't have the most stellar track record since it came in 2004. it's done a series of secondary offerings most recently a 12 million share offering just this week-k now some people believe their business model might not be working well. in my view stay away. if you want a high yielder stick to the mlps, kindred morgan. markwest which reports next week. and if you need something with a supersized double-digit yield i am still more company recommending anally capital. how about a few tweets and some mail? here's one from joe nacella. @jim cramer, thinking of picking up some mhr, magnut hunter, before the march 8th announcement. do you bless? i am going to bless this. but you have to buy more if it comes down or they do a secondary. i blessed sandridge, i know it's rocky. good quarter last night.
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i think magnum hunter is good. i had the ceo on and i like it as a spec. here's one. this is from @nate underscore o'brien. what is your take on aep, which is american electric power? is the decline short term because of this public utility -- they had a ruling in ohio. is there long-term concern? the answer is i wish that these regulators would give american electric power a break. that said, i think they're fine and i like the yield. next is from c.j. hooper 1. morgan stanley. is that the heat or the knicks? i've got to tell you, it's the heat. and they schooled jeremy lin, who looked like he thought he was going up against cornell or maybe like brown. it turned out to be the heat. he wants to know about moody's. and i say moody's is fine. maybe moody's shouldn't be because of all the things they did -- the easy ratings they gave to these housing -- to all those mortgage bonds. but moody's is fine. but even better is morgan stanley. and i'm not a knick hater. i enjoy watching nba basketball. including the knicks. stick with cramer.
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