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tv   Mad Money  CNBC  February 28, 2012 6:00pm-7:00pm EST

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see you tomorrow 9:00 a.m. for "squawk on the street." back at 5:00 for "fast money" on cnbc. meantime, don't go anywhere. "mad money" with jim cramer and the ceo of dominos begins now. domino's begins right now. >> i'm krim cramer and welcome to my world. >> you need to get in the game! they're nuts! they know nothing! >> i always like to say there's a bull market somewhere. "mad money." you can't afford to miss it. hey, i'm cramer. welcome to "mad money." welcome to cramerica. i'm trying to save you some money. my job isn't just to entertain, but i'm coaching and teaching today so call me at 800-743-cnbc. >> as we struggle to maintain the assault, the assault on 13,000 throughout the day it became more and more apparent that some stocks have simply divorced themselves from the averages. closing the block from most of the session. the dow gaining 24 points to
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finally close above 13,000. nasdaq, 106% and unlike real life, i'm talking tonight about the good divorce. with the dow breaking through the psychological crucial 13,000 level. i think a lot more moeney will e coming this market's way. it doesn't matter because it's a nice signpost and that makes it all the more important to search for future winners. that's why tonight i'm looking for the next big divorce. trying to find the next stock that can work its way free from the shackles of marriage to the indices that can go off on its own and you need to pay alimony for that matter. >> in order to find the next one, you have to look at the positive divorcees that have already happened. the ones where the shareholders are happy and well adjusted and figure out what make the difference. let's start with the stock you wish you had today, the stock
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that's the perfect illustration of why i always tell you that equities could be among the greatest wealth creators out there. let's start with -- ♪ priceline which fell an amazing 4, to take it $632.76. you might know priceline from its former pitchman, william shatner, but they bumped off shatner faster than you can put an indigenous mind-controlling inner wig in chekhov's ear in the wrath of can, by far the best of the star treks. priceline rhythm changed shatner in part because they change theired model. it is no longer driven by negotiating prices. his nickname was -- >> priceline negotiator! >> it's become a place for travellers to save money on everything. you want a cheap hotel reservation? you go to priceline which is like a giant club that gives you buying power.
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i mention all of this background because they underestimate the power of this new model change and they live on the deck of the starship enterprise. live long, don't prosper. they can't see that priceline's earnings opportunities have increased dramatically worldwide especially because people need bargains more than ever and of course, particularly those overseas where priceline's business is on fire. you don't get a stock to rally this much of a surprise especially people paying money to analyze it, which component is the driver and which point will cause this move? make no mistakes the conference call is the place to go for information and it's always the conference call that causes the biggest moves. for priceline, it was the -- ♪ >> guidance! ♪ hallelujah the company increased the earnings despite the rise in gas prices. that's what got this going. what exactly does it do? first, the management says visibility meaning they can see
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how much money they'll see out into the future. that's something so few companies have these days and when they have it investors believe they will have more control over their destiny and the vicissitudes that rocked so many other stocks and whatever changes have been made, they're not one time. they've been working and scaling which is how i feel about hotels.com, a major driver's earnings breakup and guidance tells us that the analysts had better onboard and they have to get on the case, for heaven's sake. >> all aboard! >> they have to upgrade the darn thing because they'll have to raise numbers big and then they'll stay as a hold. that makes you look pretty stupid versus the analysts who nailed the story. priceline gives us the template for an amicable divorce. who else has the raised guidance? not to be too captain obvious here, but the apple increase in earnings estimates is still propelling its stock higher. the guidance that tim cook, apple ceo gave us in the momentum of the quarter and how it did month to month to month
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has forced products to think -- wow! in the case with apple and the company will have faster earnings growth than the average stock in the s&p so it's pretty much impossible for it not to have a premium multiple. in english, apple deserves to cost more than the average stock because it's better than that. that's what's been going on during this whole rally. apple is simply way too cheap versus the average stock which happens to sell for 14 times earnings. i get the possibility that apple earns $50 a share which means it's only trading at ten times earnings. ten times, average stock 14 and since then, apple's stock should be -- unstoppable, despite its market cap. these trades are above the average and the stocks in the s&p 500 which is going nowhere near as quickly as apple. who else has raised guidances
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lately? just this year we've seen radical revisions upward from garmin and clean harbor. people think garmin has to be clobbered by the gps in your car, but it extended product lines. a couple of quarters ago, clean harbor has expanded well beyond that business to manage oil and gas sites. both companies like priceline changes stripes and the analysts are too slow to realize the new strategies are paying off. big lift in whirlpool, home appliance maker because the company repeatedly cut guidance in the back so you had a ton of short sellers betting against this one. the serial disappointer they thought would disappoint again. the last thing people would expect was guidance and revision up, which is why it went up 8%. they let us down, by increasing dramatically and it starts a em. >>ic and along comes ralph lauren with flat earnings and
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it's had a radical revision in guidance and also thanks to the decline in cost. double whammy of increase in guidance and the best boosted forecast. bottom line, you want to catch the next priceline and you're jumping for joy? look for companies that have changed their molds quickly and had tremendous success doing so een as they still remain chronically underrated or bet against simply because there's so much skepticism surrounding the company. those are the spots where they're cut and to the point where they're simply jealous and the people who jailed it. hopefully you can nail the next one, too. sharon in one of the happiest states in the country, north dakota. sharon! >> caller: hi, jim. i was wondering what your thoughts were on whirlpool considering the lower durable goods number? >> the lower durable goods number is distorted by different considerations. i think whirlpool has moved too much, up 80% from the bottom, but i think whirlpool can go much higher, why?
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because no one believes and it can sell at $76. out of a fair value another five or six points so maybe there's too much that happened. let's wait for a big sell. we have to get one eventually. guidance is what matters. you want to fly with companies like priceline that changed the stripe, but the guidance hasn't kept up with what the company is about to tell you. "mad money" will be right back. coming up, rethinking tech. where's the real innovation these days? all you have to do is follow the thread. cramer's got a new kind of tech stock and it's not what you'd expect. is it the right fit for you? >> and later, piping hot. domino's at a new all-time high after delivering another fresh quarter this morning. will a surge in mobile ordering and international expansion be the perfect recipe for your portfolio? cramer's earnings exclusive with the ceo of the iconic pizza maker is just ahead. plus, ante up. casino stocks. should you hold them or fold
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them? the stakes are high and cramer's not leaving anything to chance as he goes off the charts to find out all coming up on "mad money."
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>> tech stocks don't have a monopoly on winning innovation for new business. a lot of what we consider tech isn't innovative at all. when was the last time you and packard invented something new? can you remember? i know i can't. i want to begin the process of redefining what it means to be a tech stock. we need to deconstruct the very idea of the stock so we can identify the opportunities dumps that are using to their own
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advantage. and most people would never consider them tech stocks in a gazillion years. the thing is i think that definition of tech is outdated. when we think about it it's about hardware, software and internet, but the real essence of tech is innovation. back in the '90s what we have tech names are the series of innovations from personal computer to the e-mail on the web. in the heyday they were creating new companies almost entirely out of a whole cloth. nobody except professionals needed a pc in the '80s and in the '90s everyone needed a pc. apple being the best exam well 500 billion here and 500 billion there. we need to cast our net wider to hunt for game changing investments in places where you least expect it because they're driving stocks and this show's a stock show. take under armour, all right?
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yeah. under armour. the athletic apparel maker or at least that's how you probably think about it, but i argue that the best way to understand this one is a new tech company. from the very beginning under armour made a name for itself by inventing an entire new category for sportswear. they invented moisture wicking, compression fit apparel and they dried out faster than the clothes made from ordinary fabrics. under armour is to compression apparel what coke is to cola or kleenex, a nice dividend boost for kimberly-clark today is the tissues. that was a major accomplishment and it happened a long time ago. the reason i like under armour now and the reason why i think the stock is a buy even up at these levels and it's a couple of point away from the 52-week high is because the company never stopped innovating. they talked about the need for, quote, relentless innovation in order to keep up with their
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consumers. apparel companies were relentlessly innovative. under armour is giving us what we want to see. they're moving beyond the corecomm pregz business and they're using technology to advance new products that will allow them to take share in additional markets. for example, last year under armour rolled out charged cotton apparel. charged cotton apparel. this dries five times faster than normal cotton. this was the company's answer for people that don't like to wear synthetics, and i know people -- sounds really cool, but as all new products we need to stay skeptical and ask if they're big enough to move the needle. in this case, the answer here is an emphatic yes. >> under armour sees it as a path to quadrupling our accessible market. >> i believe it, since the market for cotton is much faster than the cotton for synthetics. people like the look and feel of cotton including me.
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i'm a professional athlete, so i have no choice and that's not all. the company also rolled out storm. their line of water-resistant hoodies where water literally roles right off. i don't even feel it! it's amazing! you're fired. a waterproof sweatshirt. come on. i didn't feel anything! it's like i'm an unfeeling and sincere man. under armour has a shirt that tracks the body's natural motion and biometric signals and they have an ultralight rung shoe that packs in a boat load of innovation in order to keep your feet dry and allows them to flex like they would naturally and a device and it is more of a device than a shoe that they say will take share away from king nike. going forward, next month under armour is launching the cold black technology. i want to be the first person to
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wear a cold black technology that reflects the heat of the sun to make athletes like me feel cooler and they're introducing a light-weight shoe designed to support all kinds of athletes and the company is making a major push to grow the underwear business this spring and they make it appealing to women. a growing business for under armour that should get better with the launch of armor bras this spring. i am not a buyer of this particular product, but i know real and spectacular when i see it. what's the point of all of these innovations? the goal of under armour, they have a phenomenal brand and the company wants to put that brand to work by moving into new product categories in order to vastly expand its total addressable market, while what we call tam on wall street. >> if you're struggling against competitors like nike, under armour's business is finally gaining traction and no one's
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ever taken on nike, for heaven's sake, plus the overall focus innovation allows the company to grow by 28% and even under armour's more mature core business, and in large part thanks to their charged cotton product. under armour is a new tech company. >> for one thing, the technological edge will maintain its pricing power and status as a premium brand and they don't need to discount the merchandise to get it sold and it's a big reason why under armour has been able to reach the distribution channels and now you can find it in regular department stores like macy's and nordstrom's and it's using innovation. i still don't feel -- i'm not kidding! that was water, to build out this business is the reason why we're willing to pay twieb times last year's earnings. to be fair that multiple isn't as expensive as it looks when
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they have the 20% long-term growth rate. that's not the growth arrest an apparel company. it's the growth rate we associate with tech. we use under armour's expansion is indeed powered by innovation. when you think about tech, don't assume that the category is limited to hardware, software and internet. the reason those stocks were so hot in the '90s when tech became a big thing is because they were driven by innovation and that's what matters and it's why i think of a serial innovator like under armour with the stock despite its limitation can charge ever higher through better, cooler and more useful products. i just wonder whether they'll develop a hoodie that will allow you to dump gatorade on me, and i don't feel it. s rob in tennessee. rob! >> caller: boo-yah, jim, from music city. >> i like that. yeah, 13,000. >> i like that. it will bring new people into the game. that's what we need. what's going on?
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>> caller: you talked recently about retailers like coach, fossil, tiffany, michael kors, nordstrom, ralph lauren. i would like to add another name for your thoughts and consideration. you talked about them before and that name is vera bradley. it seems like they have a tomorrow strategy pip know they're opening one in nashville and the symbol is vra. i love their products and i know my friends love the product and as a current price and as an investor, do you love the stock? >> you know nicole dumped the water on me and she and i will hud on this on vera bradley and reach real conclusions and maybe do a segment. i have been looking at vera bradley for a long time. it's only $1 billion. i know it's you. i will do the work. let's go to linden in california. >> caller: boo-yah to you jim,
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and for the dow breaking 13. it seems like that would be a great buyout candidate for google to get out there and compete with apple and sony and all of these other guys with electronic out'lls. what do you think? >> you've got to be kidding me. get this. this is what it's like, okay? there's a guy here and he's trying to get a phone plan, and then there's a woman here. she's trying to get a plan, after literally 15 minutes of waiting and you want something to be able to plug in. radioshack, they ain't going anywhere. now who's going somewhere? under armour, when it comes to innovation and new tech follow the thread to ua. i'm talking about relentless innovation. stay with krimer. coming up, piping hot. domino's delivering another fresh quarter this morning. will the surge in mobile
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ordering and enter national expansion be the perfect recipe for your portfolio? cramer's exclusive with the ceo of the iconic pays maker is just ahead. and later, ante up. casino stocks, should you hold them or fold them? the stakes are high and cramer's not leaving anything to chance as he goes off the charts to find out all coming up on mad money.
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when it comes to helping you to try to make money there's nothing better than the kind of transformation or turnaround story where a decent company makes itself into a great company. that's why you have to be on the lookout for companies changing their stripes. companies like domino's pizza, dpz for you home gamers, the largest pizza chain on earth and one of the best turnarounds i have ever seen in my life. how big is this transformation? domino's did something not many companies are willing to do. they were willing to take constructive criticism and take it seriously. they got rid of those that were not so positive to the cardboard, not necessarily the big container board and replacing it with a much better tasting one and they launched an internet ordering system which includes an iphone app and for the ultimate topping domino's
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has the best in class business growing like india, malaysia and turkey. it's the all-american export. it's one of the domino's shot the lights out when it reported this morning. and 49-cent basis, slightly wacher than expected overall revenues, but 6% same-store sales on top of really high numbers last year. more important, domino's raised the long-term international same-store forecast. the vast majority of the company is a franchise. it's a franchise that bears the burden of higher cost. the stock has been stalled so far this year. after today the stock soared $5.28, 15.7% today. usually that's what you get when you have a takeover! it's give young a 278% gain. i'll read that again because it's unbelievable. 278% gain since january 2010. let's check in with patrick doyle, the ceo of domino's pizza to find out more about the quarter and what's ahead for the company. welcome back to "mad money."
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>> hi, jim. how are you? >> i'm good because i've been telling everyone in the world that they should buy your stock and it's working! i want to go right to it. was it the tuscan? was it the new cheesy breads which by the way, i love, but i only have half of one and you came back and said it's retention and customer satisfaction. what is driving retention and customer satisfaction? >> we've got a better pizza and consumers continue to give us credit for it and that's been it now for two years since we relaunched. we had product news and the technology is playing in, but at the end of the day we're giving customers a much better experience and coming back. they're buying more often and retaining more customers so it keeps building for us and it's a beautiful thing. >> you have certain days that struck me. you have facebook day and super bowl with good participation.
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how important is social media to your business? >> it's incredibly important. we've now got 5.5 million facebook fans and we're up 400% on facebook and twitter in terms of likes and followers and so it's a big part of it. it's a more efficient way to market and it's a way to have one-on-one communications with our customers and it's playing great and then with technology we can move them straight from that conversation into an order. so it's a real time conversation that can drive revenue for the stores. >> and i said that you're a technology company and i was ridiculed because i don't think people understand. it has led to a dramatic decline in your labor cost, right? >> that's absolutely right and it's a better overall customer experience, but they're using
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their labor to take the order. now about a third of our total business, both u.s. and globally is digital. our mobile business is 6% and they have a no-cheese option. i could not find the no-cheese option on my apple iphone. >> it's on there. it's on there. >> you go, mozzarella cheese gives you four choices, non, light, normal and extra. we're listening to all our customers and we launched an android app just this week and how it works out for the top line and for the cost. >> i'm a huge domino's user. my daughters are vegetarians and we always order the no-cheese option. one person that has feedback and i want to ask you how that's going. you can choose your theme on it, and it's fun to order domino's.
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you clearly are getting good response to how much fun the website is. >> yeah. people love the tracker. and it's interesting because we did a lot of research that told us the one part of the process that people didn't like was the wait. they loved ordering. they loved getting the pizza, but that time in between, i don't know when it's going get there, it's stressful so we give them some certainty. we give them some fun around that and so it's been a great change, great way to leverage particular tech with the customers. it isn't just a growth market. it's got to be a share take market. do you have any data that indicates that some of the other guys in this segment are starting to get hit by what you're doing? >>. >> the good news is the cat gore's looking better now. the category was up a little bit last year i think for the first time in a few years and so we've beaten both of our major competitors three years in a row on same-store sales growth, but
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the cat gore's's getting healthier, so while we've taken share, we're seeing growth from the other players. i think the players that may feel it a bit are the regional ones because it's tough to have the technology platform we've got to give that kind of experience to the customers. so with better tasting pizza, the technologies platform driving the costs out, we've got pretty great global momentum right now. >> people want to know and they don't understand your model. they say wait a second, cheese is going up, gasoline is going up. just walk through in 30 seconds how relatively unimportant those things are to your model versus maybe some of the other guys. >> well, i mean, we're over 90% franchised. so over the medium term it matters because that plays into our franchisee's profitability, but in the near-term because we don't own most of the stores. we're a little bit insulated from that, the good news is commodities are actually being pretty kind to us this year. we're looking at kind of a tough
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summer last summer on cheese, cheese has backed off -- we're looking at a 1% to 2% commodity increase this year. hopefully we got that right. if that's right then store profits are going to move in the right direction. that's good for our franchisees and ultimately, that's what generates store growth. >> you have a big callout on india and how great that's going and a relatively muted kind of a request. someone wanted to know whether you wanted to go to china. it doesn't sound like you're ready to make a big push in china, right? >> well, we're in china and it's starting to move a little bit. it's still very small. we've got 15, 18 stores in mainland china. >> there are a lot of people in china just for those 15 stores. >> there are a let of people there, but you're right. in the meantime, india's been the dig story. we opened 75 stores and they're still in the 30% comp range, just a booming story for us, but we'll get there in china. we'll get there in china, nothing huge near-term, but
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we're definitely putting time and effort into it. >> one last word, you should tell people why it's so big in india. it's because of you catching a big vegetarian wave. >> that's absolutely right. adapting our product for the indian market is very easy. you know, we're selling half of the pizzas over there are vegetarian and so it adapts well to toppings and adapts well to local flavors and panires and mass allahs and we have a fabulous partner that's doing just a bang-up job in india and it's just booming for us. just an incredible market for us. >> patrick, you have rewarded everyone just by doing it the best way, making better pizza and having better technology. thank you very much for coming on the show and congratulations on an amazing quarter. >> thanks, jim. i appreciate it. >> patrick doyle and president and ceo of domino's pizza, without a doubt one of the greatest stocks we have ever nailed on "mad money" and it's
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because of the work that patrick doyle is doing for shareholders. stay with dpc and yes, stay with cramer. >> coming up, can you handle the heat? cramer gets you fired up for a searing hot lightning round and later, ante up. casino stocks, should you hold them or fold them? the stakes are high and cramer's not leaving anything to charnce as he goes off the charts to find out all coming up on "mad money."
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it is time -- it is time for the lightning round! [ indiscernible are you over skee-daddy! start with jordan in california. >> caller: boo-yah jim from napa, california.tart with jord. >> caller: boo-yah jim from napa, california. should i buy, buy, buy or drop it like it's hot? >> what's the stock. >> zag. >> give me a break and see how
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it acts after the big quarter's over. let's go to john in nebraska. john! >> caller: good evening, jim. a great, big, red husker boo-yah from mike in nebraska. >> what's on your mind? >> caller: i wanted to know your thoughts on -- >> no, i don't want to touch any of the gaming places. i think they're all overvalued. let's go to linda in my home state of new jersey. >> caller: hi, jim. boo-yah and thank you for all of your great investing advice. >> you're terrific, linda. thank you. >> caller: today i'm asking you about via com. >> you know what? i like the buyback, but that's all i like. i don't want you to own it. let's go to jim in ohio. jim? >> caller: boo-yah, cramer! >> boo-yah. >> caller: i just wanted to get your take on baker hughes international. >> i have so many others that i like. i have schlumberger that i love more and avesco. let's go to abbey. >> caller: it's abbey from beautiful long island, new york. >> i had a feeling.
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what's go onniing on? >> caller: is it still okay to get into vv? >> no, no, no, that has been made. this -- we had a gain. we're ringing the register. bing, bing, bing. aaron in michigan! >> caller: give me the spec, what do you think? >> sales are going up. what's not to like? it's good to go. let's go to sam in massachusetts. sam! >> caller: sam, with a big boo-yah from -- university. >> fantastic school. what's going on? >> caller: the question is the 8.3% yield offered by pitney bow bowes, ppi, too good to be true? >> i no longer trust it. let's have the company back on because all they're doing doesn't seem to be taking hold. let's go to kip in florida. kip! >> caller: hey, jim, tee. >> disappointing.
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that's the better play and one more, marilyn in florida. >> caller: jim, thanks for taking my call. i really value your opinions and in light of the situation in the middle east, what do you think about holding or selling check point software, chke? >> you're worried about israel. i would say don't worry about it, it's a good worldwide company and happens to be located there. it's good to own and that, ladies and gentlemen, is the conclusion of the lightning round! >> the lightning round is sponsored by t.d. ameritrade. >> mad money, you're making me money for college. i love you. >> how many kids call in to say
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>> we understand when stocks need to be moved and you need to be familiar with the concept of i talk about this notion a lot, the idea that within any given sector some stocks are leaders. they're the generals and others are followers, regular enlisted soldiers that get dragged along by their officers, but how do you tell the difference between a general and a private? and what makes a four star? we have to spend time on this because these are critical questions which is why tonight we're going off the charts and take a close idea of the pick the on graph of leadership using casino stocks for for example, with the excepten technician, and being my colleague on money.com, the paid sister site to the street.com. there are three we follow, las vegas sands, and mg, in. this is the kind of thing chartists love, one can give you
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a clue of the future direction of the other, but which one? you need to take your cue from the leader and first that means figuring out who the leader is which can sometimes be a little tricky. first, check out this chart of wynn resorts. for a long time wynn was the undisputed generalist of the casino stocks and outperformed the rest of the bunch and we're win-win, the others followed. however, that will change over the summer and this chart tell us the story of how it happened. the first red flag came on july 19th. >> when wynn had an outside bearish day and that's when the stock is a higher high and the previous day and then a lower low and it closes down. that is just dreadful. i see your complains and i know them. this is the one of most formations that they regard as a serious sign that a top could be a hand and a top is exactly what
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you've got. that's why sometimes it's you've got to have it. wynn made a lower high on september 20th and it was like the bearish outside days and they lost the king of the casinos and that the trend was going against it. the stock trended for much lower for months until the resent rebound and look what you would have avoided if you would have just followed this bearish day. more on that in a moment about what happens. now, when wynn surrendered its leadership status, las vegas sands stepped up to fill the void and take a look at this chart because this is what a true general looks leak. i'm giving this one a battlefield promotion and it just booked through the resistance that had been keeping a lid on the stock for nearly two years. lvs is a classic example of how
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leaders behave. they keep charging higher and higher and let nothing stand in their way. yesterday las vegas sands closed at $53 and if it managed to brake out above 54 then he thinks smooth sailing is all of the way up to $65 a share and lvs broke through that level and never looked back so the move could be upon us. where does the $65 price target come from? it gets the idea from what's called the measured move when you look at the size of the next rally and the next one would be roughly similar, okay? for nearly two years, las vegas sands trading sideways between 36 and a bit more than 50 until it finally broke through the key resistance level earlier this month. if lvs replicates it next stop is 65 and it could see it it going as high as 68 before it runs into resistance. holy cow, we've got a runaway
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train! how about mgm? >> if the casino stocks are an animal then mgm, this is the tail that wags whatever the leading dog is barking and that's been happening since late december. mgm has been rallying like crazy. the stocks moved up about 55% from its december lows, but it thinks it's gone into a lookout pullback mode, okay? the reason mgm was in this accelerated channel and that sort of thing gives the pullback. traders sell mgm here. down to $12.30 before it rebounds and resumes higher. so they wouldn't buy mgm and i am with redler on this. there's something happening that i think is pretty interesting that it believes could be a
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major opportunity. remember the idea of leadership? las vegas sands has been rallying hard of late and that took up mgm and former leader wynn. it looks like it's ready. it's ready to move higher. earlier it gapped up on a better than expected quarter and now it's back above the key moving averages and that's another extremely bullish, technical signal and as long as it continues to hold above $115, okay? they think we might have a juicy trade on our hand and if they can break out the resistance over 120 then it should be smooth sail coming doesn't happen until 132 to 135. that's an excellent risk reward considering the strong floor of support at wynn at 115. we are talking about 17 up and two down. and the las vegas sarnsd the undisputed leader as an investment. my view? you know las vegas sands is my
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favorite casino company because they do a lot of business in mac macao, the vegas of china, and even though wynn might appear cheaper here because it's stayed still, the fact is they both sell for 17 times earnings and las vegas sands has a much higher growth rate and that's what caused a lot of this in retro speshths i think, with a large shareholder that's going to, rouse regulators in the court and something i don't like for any stock, but particularly in the heavily regulated casino industry. this isn't where anything goes and we need michael douglas to remind us of it. and fair do wells do get in trouble. although at these levels i would wait for a pullback to buy lvs, but i am tempted to go long right here betting the worst might be over at wynn. here's the bottom line. leadership is not subjective concept that i made up. it's a real thing in the stock market, and it can be measured by the technicals.
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as we've seen from xm work that predicts more days ahead in las vegas sands and the general leading the casinos higher and the trading rally and mgm, let it catch its breath and this is one case where the charts and the fundamentals agree, go with with lvs especially in a pullback, that is if we ever get one. "mad money" is back after the break.
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you know what a misses me the disparity between the consumer product company, general mills and clark. you have two growers and excellent deaf dens and terrific balance sheets. both companies have good visi e visibility and for security and intel. xbox and microsoft, got commodity costs under control and they're heavily into fast-growing, merging markets and have very little competition. they're safe and secure, they both grow at roughly 10% and yet, they sell for just ten and 11 times earnings, but the consumer goods stocks, these ones totally consist in companies and they've been coming up short for some time now. general mills missed the quarter in a big way. basketball, people are liking it and they announced the colossal restructuring and they needed to do it. they lagged terribly and pepsi underspent against coke despite terrific innovation and struggles to stay one step ahead of the posse. proctor which grows earnings at
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a 9% clip long term 16 times earnings and clark has a 10% long-term growth. general mills which missed numbers in 8% growth gets awarded a 15% multiple. >> 15.5% multiem. look, it would be one thing if the consumer goods things had vastly superior dividends and they're slightly higher from microsoft. i have long praised consumer goods on this show as a terrific place for investors to park the money long term. give me the sleep at night factor and they're paying up for those earnings, but i no longer believe the stocks are worthy of that preview. in pack, i wonder if they can go the way of the big pharma stocks. stocks like merck and pfizer, both 3.8% long-term growth rates and now they're multiples have shrunk in the high single digits and many stocks in the group have no growth at all and they have the high dividend, and when i look at the presentations they
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got from the annual dog and pony show in boca, i think we'll have to start challenging our a slumpings about what we should pay for these stocks. 15 and 16 times earnings doesn't seem quite right. they're just too cheap, versus the stock competition with fresh innovation kebeing the norm. you need a catalyst leak a new acquisition that moves the needle and think kellogg, and think b & g foods and the dividend booster who we heard yesterday. if you want to sleep soundly tonight, maybe it's time to think about earning intel or microsoft. it offers a higher reward at a lower risk to earnings. stick with cramer. it's midnight in michigan for mitt. eric cantor visits with a new jobs plan and jimmy rogers and the panel talk dow 13,000. [ male announcer ] how do you trade?
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