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tv   Mad Money  CNBC  November 20, 2012 6:00pm-7:00pm EST

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see you tomorrow for "squawk on the street." back at 5:00 for "fast 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 like to say there is a bull market somewhere. "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 help you save some money. i'm trying to educate you. call me at 1-800-743-cnbc. don't invest in household names just because they are hold hold. don't speculate in companies because you believe a takeover could occur. these are time-honored mace techs. the average has drifted over
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foreheading higher into the close. the nasdaq gaining 0.02%. much of today's earlier market we get from the gloomy assessment. ♪ [ baby crying ] . the chairman said the economy isn't able to handle the spending cuts. we know those comments caused the pull of the intraday pullback. we did in the end rebound nicely. it was a huge victory for the bulls. the losses regardless of the cliff and it's afterimagine we need to head off the personal portfolio management errors before they cost another dime for us.
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today we got two examples of what could go wrong in banking. if you are like me, i have both and hq and pc household printer. to finish at $11.71. best buy. the big box retailer, i have not once but twice done in the last six months. closed at $11.96. two household names that you have been lured into only to have hopes dashed into unmitigated disasters. >> the house of pain. >> what went wrong? hewl hewlett-packard was an accounting scandal. both seemed to shock investors
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however, if you watch this show, you should never have been in these stocks. i told you that these companies were total dogs. this morning the company was acquired for $10 million and this was stunning news. if you own hewlett-packard you were in the crosshairs of two victims. you have to sell sell sell. i kept a hand-written note, accounting irregular layerities equal sell. hewlett-packard has got to be sold. i have to tell you that you should be selling the company for ages.
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i believe that the culture of the company has been broken for a long time. first, it has gone from being an innovate ter to an asem bler and puts them into a machine. so do many other companies and it is going up against apple which is slowly taking share and now that is accelerating. sit sells printers, neither the pc nor the printer business is taking control. it bought ge but now finally tried to crush cisco but it has since van kwished them. notice, it is being crushed in every segment in it's business
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and it is down 55% this year. they have a whole new reason not to own it. it needs to be sold when you can. how about best buy? here is a stock that has been cut in half during a time of endless rumors that something grand was going to happen. that it's founder was going to lauto launch a take over bid and take the company private. they have declining with terrible sales. i think that it is again not too late to sell sell sell best buy. the simple fact here is that amazon is looking to acquire best buy. we have a huge tv price war.
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let's step back for a second. the tech firm is littered with household names that has cost you a fortune. we have seen dell, microsoft, in tell stagnate and people are hooked on the once great growth engine of the personal computer. the alleged fraud only makes it turn around that much less likely. remember circuit city? it met it's demice not that long ago. both kir skit city and radio shack -- how did that go for you? the fundamentals are in decline.
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a desperate hewlett-packard management purchased the scand ascandal ridden amid the losing bid. [ crying baby ] . they have to borrow somebody else's money. so the buyout gets increasingly unlikely. they can't really believe it can be all that bad. but trust me, it can get worse. here is the bottom line, if they are declining, don't think they can be turned around by a new person or at all, don't believe that there could be a rescue bid to take you out of it. if you don't own best buy or hewlett-packard or any of their
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ilk take a pass f you do, take advantage of any mouz and exit. >> reporter: booyah jim, how about them ravens? >> they look good. ray, get better fast. >> jim, i want your opinion on b&g foods. since they buy companies that are well-known but in financial trouble -- >> listen skippy, i wanted to buy skippy. we don't want to buy hose tess foods. because they have labor issues galore. i say bye-buy buy buy bgs. jack? in new york. >> ups versus fed dex.
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>> i like the fact that fedex did not pay for an acquisition at the top of the market in europe. fedex should be buy buy buy. but stay cautious. two examples of what can go wrong, hewlett-packard and best buy. "mad money" will be right back. >> coming up. hewlett-packard discloses billions of dollars in accounting issues. can others still soar? salesforce.com fresh off it's earnings. the holidays are approaching and consumers are marching on the
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ma malls. cramer has his sight set on a retailer that is off the beaten path. there is a lot weighing on this market. fiscal clip fears. but after weeks of painful retreat, is a turn finally coming? in tonight's edition of off the charts. all coming up on "mad money." don't miss a second of "mad money," follow on twitter, have a question, tweet cramer, send jim an e-mail. or give us a call. miss something, head to our website. can i help you?
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throughout this entire
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period, there has been one trend that has been held up the entire time. crm is the symbol. the software is the service player that is the king of the cloud. tech is linked in for the higher price that is multiple. being a high flying turbo charged stock can be a high wire act. the company reported one cent earnings beating off with revenues coming in higher. even better the company's deferred revenue, if you go into the website you will see why it is up 41%. let's check in with the visi visionary ceo and see where this company is headed. jim, great to be with you.
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thank you for having me today. >> these numbers i know do not include the business if hurricane sandy had not have hit. >> it was a great quarter. as you can see. $788 million is up 35%. jim, you know we have been on that talking about the 30% plus both quarters, it is an awesome time to deliver a quarter like that. all of these other things and here we are delivering this great number. $1.29 billion really great.
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how are you with the operating cash flow for this quarter? well, you can see, we have delivered more than $100 million, this is our 5th consecutive quarter withbrating cash flow in excess of $100 million. we are in a market share game. cloud computing and mobil, nothing is getting our customers faster results or delivery. we are absolutely the leader in the area. most people are trying to back
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away from europe. why bother? >> you can see europe had a great quarter. these customers in europe are under tremendous dir res. they have to turn to vend dors like us that can deliver solutions right now. that is why cloud computing always grows during times of distress. when companies can't operate the way they normally do, they are going to go to vendors like us who will deliver this next generation ofclusi solutions fo them. >> you had to be plbhanch today.
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would you have been able to spot what autonomy was doing? >> i'm not sure that anybody has the details to know that. we are making acquisitions not for revenue or market share. we are making them for two things. next generation technology or two, incredible entrepreneurs that we are bringing into our company. we have done nearly two dozen and some have been great and not as great but we are getting incredible people and technology and it is positioned and a great way to innovate. i don't think that anybody should look at hp today. i think you have to look at acquisitions as a key way to lick wi dade quidate in your co.
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>> it seems like they are deeply challenged after this. >> we are. we have been working closely with the team. you probably heard meg on her call today. in fact, we have deployed 16,000 users and are working hard to transform their sales and service systems and the way they collaborate and we home that when the story is written and we see the turn around that they will look back as one of the key ways they will achieve massive both. >> you have been trying to go to $4 billion and then $10 billion. at what point do you think they will say, lizen mark, we need to see the price to earnings multiple not be as rich.
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how ufr yever you can do that, need to see something in earnings >> at salesforce.com there is only try not just do. just as we have passed that run rat rate. the reason we have been able to achieve and become the most valuable enterprize software companies is to emphasize on growth. as we get larger, there will be a time when we are willing to
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mitigate revenue growth but that is not where we are today. we are able to offer these customers this and there are companies that need new systems now. and we have the ability to make that happen, but we have taken on an expensive proposition and in the same way, look at that top line growth. >> it is the best of all the companies i have followed. the chairman and ceo of sales force.com. >> may the sales force be with you. ? >> thank you so much. after the break i'm trying to make more money >> the holidays are approaching
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and consumers are marching on the mails. cramer has his sights set on one retailer that is off the beaten path. a frail recovery. tonight cramer is using the tech nickels for a move in the market. in tonight's edition of off the charts coming up on "mad money." [ male announcer ] at scottrade,
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[ male announcer ] break from the holiday stress. ship fedex express ber 22nd for christmas delivery. never judge a quarter by the head line numbers. this kind of quick draw mcgraw thinking can lead you to making terrible mistakes. case in point, urban outfitters. it looked disappointing. revenues only in line. the comps were up 1 percent across all of urban's brands and they seemed pretty darned lousy which is why they never sold the
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stock. anybody who sold down there is feeling like a moron. sellers jumped the gun. if they had waited for the conference call, they would have realized that this was a fabulous call. they are in great shape. not only is it perfectly in tact, i think it is picking up speed. people didn't know how to read the comps. they saw that store comps were down across the board. the reason the head line number
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was bad it counts against the numbers for sales. company also owns anthropology. not just because i was there this weekend. i actually think the gain is more impresstive. this was actually the brand's best result in two years. what else? urban's gross margin was up to 37.6%.
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due to fewer markdowns. on the conference call management said they will be less promotion al. it makes me think this next quarter will be better than the last. you are getting this quarter for free. you know what i call it? i call it the congratulations situation. of the 19 analysts who asked questions, 11 of them gave management a congratulations of 57.8% normally when you get that, the stock will trade higher. but urban is being held back
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that caused the stock to creator in initial trading. get this, from 2000, 2010 urban rallied over 100%. the company founder and chairman of the board took the helm back in january. haines knows the brand and customers better than any one. he sold and wants the job back.
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in other words the stock has stagnated for the last two years. never deviate from character. it is a testament to the power of good management. and one other company's three cylinders would be hit at once. the online business seems to be on fire. so many other retailers are saying, no their direct consumer sales are direct. late september hain laid out this plan for the company's future. this goal is to accelerate the company's growth. putting it in the retailers that
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the sweet loves and he thinks he can grow the online business and expand the assortment to petite sized clothing and intimate apparel. we know the online plan is bo working. how about the store growth? hain believes he can hit 200 to 250 stores. almost more than 100 locations. he is planning to expand internationally. but they are having good results terr there. they are likely to start moving into asia next year.
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so if 17.7 growth rate than deliver on this turn around. i think the stock will be higher in the 40s the next time i talk about it. when a company reports, do the homework, listen to the conference call and make an informed decision, management is execu executing beautifully and the management is going to buy into weakness instead of helding into the abyss i'm going to lauren in new york. >> hey jim, i love shopping and with cyber monday coming up do you think that ebay could be a good-bye? >> i think the stock is still
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inexpensive. i think the paypal is worth almost the entire price of the company. pat in california, pat. >> hi jim, i wanted to ask about raw stores. the earnings keep going up and the stock is going down down down. >> she sent out an e-mail and we think raw stores is a boy buy b buy right here. i think the big froth is out of the stock and they have a lot of places that can open the stores. don't take headlines at face value anymore. when you turn tyou are going to
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see it. >> he goes fast and furious. giving stock after stock their final verdict on the lightening round. and later, bottoming out. there is a lot weighing on this market. fiscal cliff fears and after weeks of painful retreat. is a turn coming? tonight he is using the technicals in tonight's edition of off the charts coming up on "mad money."
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it is time for the lightening round. are you ready? starting with manny in georgia. >> booyah from the peach tate. del. >> i know, i know, i like all of the press that delta is getting. if you had the stock i would say yes, but you don't need the
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stock. >> robin florida. go ahead you are are up. i want to give you a big florida state booyah. >> i want to know about duke energy. >> i think that 5% field is terrific. let's go to shaladr area in ohi. >> i was trying to find out if western union would you see that as a buy or sell? >> no, i will tell you why. that was one of the most disturbing conference calls. let's go to art.
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my stock is gihu reported a terrific quarter again yesterday and i wonder what you shout. >> there are a lot of chinese companies, buy the fxi. that is what my trust has been buying. we believe that china has been making a major turn. let's go to jeanette in florida. i would like to know what you think of amcc. >> way too at the mercy of the big buyers of the technology. that thing blows in the wind of whether the big guys need equipment or not. >> let's go to michael. >> cim what are your thoughts?
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don't buy. >> let's go to sal in florida. how about you? >> thank you. i have stock that goes up and down. csco. >> listen sunshine, that quarter was terrific. i think you should buy buy by it. ben in texas ben. >> university of texas booyah to you. >> hook em, what's up? >> graduating senior looks at paa. >> stop looking start buying. that is the stock you have to buy. people feel that may be peace in the mid east. >> this is michael from newport
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beach. i'm going to say wait for the 4%. i don't see why you need to own it. but sell it only when it yields back at 4. that is the conclusion of the lightening round. coming up. bottoming out? there is a lot weighing on this market. a real recovery. after weeks of a retreat, is a turn coming? in tonight's edition of off the charts. ] this is joe woods' first day of work. and his new boss told him two things -- cook what you love, and save your money. joe doesn't know it yet, but he'll work his way up from busser to waiter to chef before opening a restaurant specializing in fish and game from the great northwest. he'll start investing early,
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he'll find some good people to help guide him, and he'll set money aside from his first day of work to his last, which isn't rocket science. it's just common sense. from td ameritrade.
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was yesterday's rally for real? have we made it out of the house of pain? isn't that the big question in this market?
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brilliant technician also happens to be my colleague and called the top at the s&p 500. so as far as we're concerned she has street credit when it comes to predicting the market. she said that if the s&p 500 dropped below he 36 all bets were off. that is what happened. this market has been miserable and it has been a horror show. so the question is, is this another opportunity for you to take profits before we head back down. i'm going to show you why, i want you to take a look at this daily chart at the s&p 500.
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when it made the low on friday, it did so near some very important levels in terms of price and time. mean iing the medieval mathmatician, here are the numbers, 26.6% and 61.8%. as it turns out, not only do they repeat in nature, but they show up in the charts as key turning points. as you can see from this chart, when the s&p bottomed on friday, it did so with two key price levels, there was a 61.8% replacement from the june 4th lows which created a floor at
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1346. and there was a projection to the november 2011 low which put in another floor at 1340. they actually do work. okay, the fact that the s&p bottomed makes him think that this could be an important low. they call them clusters, it could mean that the trend is about to change. and that could mean a very good thing. the same analysis that brodin did, it is too coincidental, 43 trading days from high to low. when you look at these charts you will see that big declines or advances will last for the same number of days, it does
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happen, when bro din sees that it was 43 days, traiting days from september 14th high, that is what we are looking for, that is the big deal. it could mean that the decline has at last run it's course. it can't be coincidence. there is another issue here. if you look at the rally from june 4th, to september 14th. you have to go from here to here now. you multiply how long this current decline has lasted. all of this time and price stuff tells brodin, if we continue to hold above these levels, she could see the s&p going to 18.8%
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above where we are right now. we did take out her initial line in the sand and we get back above that level. check out the second chart to see the obstacles that stand in the way of that gain. the s&p is three ceilings of resistance that could start to clear those levels. we have the ceiling created for the highs. let's call that the romney rally which creates a thick wall of resistance to $14.50. if we beat the re-election highs, then there is still one
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last barrier even though it broke down before the election. the move would pea ter out. right now we are out in the same area and then start giving up ground. to get over the symmetry problem. the s&p needs to close over 1391 and needs to do it real fast. even though brodin has a costly attitude. the new line in the sand is the november 16th line of 1346. here is the bottom line. based on the reading of the charts, br are o dodin things it a flash in the pan. her chart suggests it was perhaps a real bottom. if we go over the fiscal cliff, it is good to have the charts or
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her reading of the charts on the bull side again. m "mad money" is back after the break. if we want to improve our schools... ... what should we invest in? maybe new buildings? what about updated equipment? they can help, but recent research shows... ... nothing transforms schools like investing in advanced teacher education. let's build a strong foundation. let's invest in our teachers so they can inspire our students.
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let's solve this.
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what really matters? i don't know. does a french sovereign bond rating matter? that would send us down here. somehow our financials would get
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hit here. we would be focused on the prospects to make it through this crisis. it would be the cause for major handwrittening on how france is going into a recession. it would be the prelude to a armged don. the kind of gains you would expect on an upgrade.
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second the ratings agencies, they don't have the clout they used to have. in the end, it doesn't change much. as france will do the best that it will. consider that our national debt went down last year. we will probably get downgraded again here. but it will be a so what event. nobody is going to sell you u.s. bonds. we don't have that kind of demand. at least when it comes to spill over to here. many of those have cut their exposure. companies are cutting back.
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it has been working. find alley the sheer length of time that this crisis has unfolded, it makes everything more easily to deal with. last year i was arguing for a kick the can strategy. a lot of the traditional thinking has got us there. if it does sink us into the oblivion is there. it has not been lost just diluted.
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they got their heads cut off at has been the way of the french. stick with cramer are. having you ship my gifts couldn't be easier. well, having a ton of locations doesn't hurt. and my daughter loves the santa. oh, ah sir. that is a customer. let's not tell mom. [ male announcer ] break from the holiday stress. fedex office. that bringing you better technology helps make you a better investor. with our revolutionary e-trade 360 dashboard you see exactly where your money is and what it's doing live. our e-trade pro platform offers powerful functionality that's still so usable you'll actually use it. and our mobile apps are the ultimate in wherever whenever investing.
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