tv Mad Money CNBC May 3, 2013 6:00pm-7:01pm EDT
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about coke and how it's doing well in emerging markets. >> dan? >> good shot spot to reshort ibm. >> mike? >> just bad singles here. take what the market is selling you. >> i'm melissa lee. for more simple, to make you money. i'm here to level the playing field for all investors. there's always a bull market somewhere, i promise to help you find it. "mad money" starts now! hey, i'm cramer. welcome to "mad money." welcome to cramerica. if you want to make friends, i'm trying to help you make money. my job is not just to entertain you, but to ed kite you. call me at 1-800-743-cnbc. no number, no number is more important than the jobs number. today we saw how powerful this
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piece of data can be as the dow roared 142 points! s&p climbed 101.05. fax rose 1 .14% on the strength of a much better jobs creation number. you know what happens, especially after a previous month, it was quite despirited. you catch a lot of people looking the wrong way and you saw that today as people threw money at the market. at any company that actually bends metal or manufacturers goods out of raw materials or pollutes. all week, the big industrials have been on a tear and today we found out why. because this payroll number says, don't worry, be happy. the economy is, indeed, at last getting better. there will be more demand for all things manufacturing, minerals and mining stocks. but excuse me for being parochial. i don't want to be too parochial. everything except the food and
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drug stocks rally on this kind of data. the technology and transport stocks among the strongest. if you hang around, they will have performed well of late. they are still totally ripe for the buy, buy, buy, as early as monday morning. i'm not dising the drugs and foods. if you looked today, they didn't go up. this market, i'm calling it a soon task measure. we have to value what's going on next week! to look for still more opportunities and avoid more pitfalls. now, next week, it's really one of those rare weeks. it's a rare one where the most important event actually occurs this weekend. when 35,000 people venture to omaha to hear warren buffet opine on the state of the annual meeting. buffet asked for a volunteer who dislikes his stock to travel to omaha to debate the oracle,
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himself. sure enough, cast, whose short berkshire hathaway, asks, hey, you know what, i'll take that whiping. i suspect buffet willed a minister this to cash. right now, it's about as healthy as i've seen it with that terrific position they got in housing. they got the rising price of insurance with them with geico. they need 15 minutes there t. new bounty with the transporters of fuel the terrific railroad, of course, all those big stock portfolio. earlier this week in our off the carts segment, we suggested berkshire could be breaking out. i suspect this weekend's confab, it will be the launching pad for my preferred way to play warren buffet. which is what i have been recommending for ages and am proud of this. if you miss anything from this weekend, i tell you, don't
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worry. because becky quick is out there and we will get three full hours of warren on monday morning on "squawk box." i set the recorder. we have anadarko and aig. we like the gulf of mexico holdings. remember, gum, gulf of mexico. i think they can forecast their producer for how much they can produce. aig, the north dakota and eog i think more important, frankly, it's overshadowed. eog has built its own railroad line to take it where it needs to go to be more refined. the ceo doesn't believe there is that much upside to natural gas. i'll see if he thinks this recent run is for real or is it just going to be rolled back come the warm winter and, once again, be silent by deadly. tuesday we get the much awaited
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whole foods report. i am concerned about whole foods after slain celestial, a key supplier gave what i required. i found it somewhat cautious. somewhat cautious that sent the stock down $2 today. whole foods have been struggling the last time it reported. we know the competition in this space from both kroger and, yes, trader joe's. i like that place and trader joe's have started to give whole foods a run for its money. i would feel a lot more comfort annual about the stock going to the quarter if it were hanging out in the '80s. i know the long-term growth is intact. we could use a lot more. i wouldn't be surprised if it doesn't run more after spending all that time in purgatory. the walt diz if i reports on tuesday, bob eiger's company, i think it is going to be fantastic. i got to tell you that the multi-year strars aligned here with a film red hot right now, brand-new "iron man 3" and more
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adventures, there is star wars star wars coming. star wars star wars 7. espn is claiming money. here's my hope. i hope come wednesday, see, i hope that disney, i hope that disney gets crushed. you know why? because i want to come out here wednesday evening and tell you to buy it. wednesday we're going to the oil patch. that's right. we got continental resources. remember them in the pocket? that's where we visited, right, two years ago? then we have the controversial heckman corps. the oil and service frack water play that has been a real bow wow. i like this $3 stock i do not expect will have a big quarter. because drilling for gas has been cut back dramatically since the price of that dpas while higher than it was this time last year is not trusted to stay high by any of the major players in the industry. oh, just speaking of fracking, the "mad money" horse in the derby is, indeed, frack daddy,
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because we do favor north american nernlgs energy independence. thursday is going to be fun because dish network supports. ah, dish, the baby of charlie ergan. he's trying to buy sprint, trying to steal it of the company for soft bank, the gigantic concern. earlier they trash talked with old fashioned smath mouth jinglism. it causes video distribution to be able to speak english. i almost fell off my care. the circle in the street said, when i read this one, hey, come on, this one is the tee ter in the first degree. yes, pay homage, not as great as the analogous ac kman rumble in the tv jungle, by my friend wapnor. i'm waiting for them to say it must be stopped because they want to create the greater east
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asian co-sphere. you know the controversy of the stock type. i don't know if there is one more than priceline. it starts because the stock is $700 and change price tag. i'm a huge believer in priceline. it's a cheaper play to travel. this one is a wild trader. the first move is not always the truest. so please be careful out there. i've seen the stock go down big and bounce back instantly. finally on friday, we get to hear from weyerhaeuser. this is the nation's largest home builder of timber supplier. when wy recently reported, the company gave you a sharply better than first quarter. that was the first time in ages. fulton was conservative. the stocks sold off. i thought it was boiler plate bare talk. i thought it would be brey more
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positive story. you can follow along. it keeps picking away py. let me give you the bottom line. it might be hard to top this week's incredible run. a run to all time dow and s&p 500 highs. but you aren't going to hear anything negative about this rally from warren buffet. and the earnings reports i see coming up, well, if anything, i think it will just stoke the bullish flames. can i start with vivian in california, please? vivian. >> jim. >> vivian. >> caller: i'm one of your home players. a home gamer. >> i love get. >> caller: and, thank you. i want to wish you a big, huge boo-yah from the wonderful sunny state of california. >> i'm taking it. >> caller: now, i have been watching and paying close attention to a stock called public storage. i would like to know, over the past three day-to-days they have been flirting with all time highs from like 25 years. what do you think i can do with
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it? >> oh, boy, you know, i like the company so much u. but i remember during the generational bottom when it was so much lower. i think it has such a run. it's a baby boomer play vivian, i cannot let you give back that gain. i cannot have you give it back. no one ever got hurt taking a profit. let's go to ellen in virginia, please. ellen. >> jim, thanks for taking my calls. you and your team, especially katy and all the off camera folks who do a fantastic job. professor cramer, i've done my homework. by stock is diebold, they reported an earnings growth on tuesday. they're up today. they're doing a major realignment, domestically and globally. so, professor cramer. they pay a 4% dividend. should i get paid to wait on diebold? thank you. >> oh, boy, i'll tell you. it's not that well run.
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it's not that well run. it does have a good yield. you are being paid to wait for something good to happen. i would be steering you wrong if i said it was a good company. i think there's good people there. i think they have not executed well. i cannot recommend it. let's go to mike in florida, please, mike. >> caller: jim, i'd like to get your report on temper medic. they beat on revenue. they guided light. and the stock was down today. >> all right. listen and listen good, mike, from the sunshine state. temper peddic is what i call ed greenburg stock. ed greenburg opines on it. that means there are red flags and eio like red flags. i will not get involved with an ed greenberg stock. it's just too dangerous. wow, what a week. can we beat it? well, it will be hard to top. but i think we hear the bulls
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marching on in as the earnings break continues and, yes, let's not forget. i do believe that there could be a whipping this weekend in only ha and it's not going to be administered by my friend doug best. stay with cramer. coming up, forgotten fuel? the dow cracks 15,000. the s&p, it's another new all time high. as we enter the dreaded month of may at record levels, think there's nothing left to buy? think again. don't miss cramer's forgotten few. that could be ready to roar! and later, facebook stocking. the social network got friendly with wall street yesterday. but is this friendship short lived or is it time to make a connection before this stock takes over the timeline long term? all coming up on "mad money." . don't miss a second of "mad money."
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the question i heard all day, what can still be bought? what's not up and up that it presents value after this miraculous employment number we got this morning. what's been overlooked or spurned that truly is cheaper than it should be? buy, buy, buy. isn't that the logical question to ask as we take up this market's all time highs? so many stocks have run here that you would think there is nothing left to buy. you know you aren't moving the colgates and the color objections. you can't claim biogen, not that those keep going up. i think it's important to point out that many stocks, while up dramatically from the generational bottom that we did
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hit in march of 2009, still could have much further room to run. all aboard? we just need to below to look for them. so let me give you the list. get your pencil and paper out. there's some good ones coming. and the first group that's met its undervalue, if financials. so many of these stocks have been totally left for dead. yet now, are finally wising, lazarus-like from the grave. take, oh, man, i can't believe i'm saying it. maybe if i say it really fast it won't hurt -- citigroup at just under 47 it's up 40% for the year. nice on the s&p 500. but have you thought about the fact that this stock used to trade at $500 a share? do you know in many ways it's better than it played at $500 years, it's learn and it's springing back to life. and i'll tell you something else that i know. it's got new energized
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leadership under ceo michael corbat. it leads some terrific emerging market. you think you are late to citigroup? think again. how about j.p. morgan? here's a stock about 10% off it's all time highs that has been kicked-by-publicity. each day i try to think of something good to say to offset the negativity. today, man, snake eyes. which in the end, it might not actually handicap the earnings and what matters is the earnings. this morning we saw a piece in the new york times about still one more scandal. this is about energy price minneapolis. each time we get these scandals, a few weeks later, we get the stock and it's higher. it is a painful ride. am i happy about the scandal? no. do i think the bad news is over here? no. not according to jamie diamond shareholder letter which said, hey, listen, we got scandals up
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the waz -- . remember, there is no judge here. it's just about value. think about this. jpm is down from when it stole washington mutual and bear stearn's for a song. that's remarkable. but it is not atypical. think wells fargo, you know what, it now has 30% of the nation's mortgage market. it was a brilliant decision, but the stocks still fought taking out its precrash high. how about two banks we have had on the show. i love this. you will love this. two banks, key bank, k ey and first horizon simple hsn. both used the downturn to solidify tear standings, what happened to the $10 stocks in the interim? let's see, key, oh, used to be at 39. first horizon used to be at 37.
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how do you spell bargains? however the biggest are insures. start with the mortgage insurance, radian and genworth. this mortgage insurance business used to have multiple players for the downtown. now it's a handful. in some cases they are incredibly profitable. now, radian has fallen from 62 to 12. genworth, 35 to 10. this is despite the fact the biggest competitor in the industry, the government, through the fha is pulling out of writing insurance because of congressional oversight. all that business is going to go to rad afghan and genworth, aig, too. let not forget harted for financial services and insure it made serious investments. the stock was traded at an unbelievable $100 before the recession is now at 28.
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in reportedly one of the best earnings of the earnings season, it is a screaming buy, people. buy, buy, buy. that's why the trust is buying. a newly invigorated microsoft, with its digital entertainment business, sell still. after this run, everyone keeps talking about it as a run. that's ridiculous, it should be 15 times earnings. that's ridiculous. it's a tech stock. i am telling you right now that 12 times earnings is absurd. then there is a real quandary, emc, the repository of dig data, yet it's down 5% off its high from 28. last year, even though it was pretty much beaten and met all wall street expectations. nobody liked it. this year, no different. just terrible. last night, we talked about how europe could be turning. two companies that had fantastic
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businesses in the u.s. and china,ed for and general motors, have been pulled down endlessly by europe. ed for traded at 18 not that long ago. actually, we were at the f-150 factory. that was before europe soured. it's a better, more liquid company now. yet it's only trading at $13 and change. gm wiped out by the recession. gm is now back to where it was before the government reported it public. at $38 to seems to me a much better buy than when the government took it public. those stocks are probably make among the most undervalued in the market. it's not like the old days where analysts covered them. every auto company is covered by hundreds of guys. nobody talks about the autos any more. they should. how about the oils? they have done nothing during this period. consider the curious case of conoco, which has gotten back to where it was, despite the market being radically higher? yield could prospect in the gulf. that's wrong.
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how about slumberge, it is down from $94 a couple years ago despite a huge pickup in business. how about time to look at usairways. airlines are looking at ways to make you pay. earlier this week, delta amr agreed to match continental's change fee for when you switch a domestic reservation hiking it from $150 to $200. this is a pattern of abuse that i feared with ten u.s. government allowed all these mergers. usairways will soon be merging with amr to form the largest airline on the earth. i bet it can make more than any other airline it has in the history of this business. they announced $17 and change as opposed to 34. we got a host of industrials brought down or kept under raps by the dow, including eaton, i think it will have a strong 2014. yet it sells at 13 times what i
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think they could earn next year. that's crazy, too. i remember when they sold at 18 times earnings. you got to turn the earnings merger bell. look at this one, general electric. $40 stocks six years ago. basically, cut in half. even as it solidified its position, i know the business has been weak of late t. conference call is a disaster. if things get stronger overseas, this could go for a run. double d, if the businesses are turning over to world wide growth, they might now be returning. i think they can be bought without too much place risk here. hey, listen, i said the earnings would be bad. they were bad. okay. the stock, you can buy it now. ultimately, i believe the market can head higher now that employment is coming back and europe is bottoming. i am not urgeing you to sell stocks. i am not telling you the biogens or the interfetes are too high.
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here's the bottom line. there are anomalies out there. stock doesn't take into account thins have gotten better. these represent the best buys. you should have no regrets if you haven't purchased one yet. we will have downturns. we will have sell-offs. now you have your shopping list the next time we get hit. after the break, i will try to make you more money.
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now that i've heard from the bulk of companies reporting for this earnings season, who do you think had the best conference call after the quarter? on a day where the markets roaring to new high, i think this is an important question. because it can tell us what stocks deserve to keep going higher still. and i have to tell you, the best call of the quarter, it was none other than -- face book. fb. facebook. which was actually, and may i say, stupidly down today. yep. facebook. i'm regarding it as the strongest story of the season. you know why? facebook is a company that doesn't want to buy back its stock or pay big dividend because the opportunity for growth is so great they want to plow every penny into the business and i love get now, look, we adore dividends here on "mad money." we like buybacks when they're
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large enough to matter. at the end of the day, there is nothing that the market likes better than growth! hallelujah. and after the quarter facebook reported on wednesday, it is clear to me they have growth up the wazu river. facebook actually did miss the street's earnings estimates by a penny, whenever you quibble like that, facebook did it in the best way possible. the tiny miss was caused by higher investment spending, something the company has been telegraphing for a while now, didn't you know? i did. in other words, they are investing to grow the business. meanwhile, on every other metric that matters, facebook beat. revenues up 38% year over year, earnings, depreciation, margin, mobile user engagement. all of tease were sharply better than i expected. more important, facebook has accelerated revenue growth.
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its growth is actually accelerating. it is getting faster, not slowing down. we haven't seen one of those argg, a for accelerated. r for revenue. g for growth. argh since before the downturn. in fact, this was their third straight quarter of accelerated revenue growth. if you were a barrel in facebook, that was the lasted thing you want to see happen. which is, of course, it is the king and practically the inventer of social media. facebook couldn't have accelerated growth. they kept saying get it turns out the bearings were wrong on both counts. not only did facebook's growth accelerate, not only did they do a terrific job of modernizing it him all of this happened when the company increased its investments by 56%. so can you imagine how well facebook will do when they finally get the cost structure
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where independents it. they will have a terrific operating leverage, maybe more than google, meaning all this revenue growth will lead to an explosion in earnings. investors are more than willing to make that happen. then there is mobile. it got slammed it hadn't adjusted. it hadn't anticipated how quickly people are switching from accessing the web on the desktop computers to use their mobile device. now, facebook is crushing it with mobile. gharter, mobile accounted for 30% of the revenue, that's up from zero at the time when they came on. mobile is up 250% in the last two quarters. facebook now generates more mobile revenue per quarter than its entire advertising business did in when the itself 10. by the way, we saw the exact sameength with mobile and yelp. they blew away the numbers on night. when i tell you this is a huge
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secular shift for everything enner realed. you got to believe me. even though fb is showing advertisers about 10% more. user engagement has never been higher. it's now at 59.9%. that is an all time record. this is a hugely important statistic. it means facebook c'monettize it without turning people off to the cite. that's a billion pair. okay the bears worry that users would flee if you subjected them to too many ads. in reality, opposites happen. after all, where the heck are they supposed to go? there is, maybe you are not young enough. because i can tell you there is only one facebook. google is trying to compete with google plus with their thing. it all the points with the social network is all the people need to be on it. that's why facebook is going to remain unrivalled in the business. and that's why i think the stock could go much higher. maybe for years to come. i'm not kidding.
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maybe for generation, this stock could be important. so much for facebook fatigue and all of that other garbage we kept here. they're going to twitter. guess what, they're sticking with facebook. consider these user statistics. the company's average irs increased 20% increased in the united states. meanwhile, facebook increased by 23% year over year. this is rather extraordinary and by 5% in the previous quarter to 1.1 billion. not only does the company have many more people using the site, they're able to use more money out of each set of eyeballs. no wonder the revenue rose 4% from the year before. these people are apaysing mind-blowing numbers. what really impresses me about facebook is the fact the company is investing in the future. they are hiring. it's hard to get a job there. they plan to spend 1.8 billion in order to expand the business correctly. this is an honest sector where the growth is still a long way
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from being tapped out. there simply aren't that many stocks like that out there. oh, and unlike so many stocks that have run this year, facebook has only rallied about 6% in 2013. 6%, that's like nothing. all right. i know, bears. i know, it sells for 36 times next years earnings estimates. i think they're way too low. given expansion and the low-term growth rated, that multiple doesn't strike me as being too expensive. this is something i felt from the call, really interesting. mark zuckerberg turns out to be every bit of a hard charging executive as the kids at google. i think, i got to tell you, this ruthless guy, he's on a mission to make his company better than the others in the valley. i think he is also really upset about the underwriting. he's going to make it back. i think he's a motivated guy. one last thing, i wouldn't write off this linkedin, either, they are down 26 or 12.9% after
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reporting it simply wasn't good enoughsh that's wrong. all right. they were being conservative. they were underperforming, under promising. i think they will deliver. linkedin was the only way, they plan on spending lots of money to grow its business and stop everybody else. hiring new workers, investigating data centres. that's not a bad thing. it's a good thing. eventually, all this vem will pay off. when that happening, you will be happy you bought linkedin on weakness. i'm trying to be emphatic on this. as much as we like companies to return cash, legitimate the fact is it's even better when a company doesn't need to do those things, because it wants to invest every last penny in growing the business. it's why i like facebook here as well as linkedin after today's big pullback. can we go to fazi in colorado? fazi! >> caller: jimmy, a big boo-yah
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from denver, colorado. how are you doing? >> i don't know, fazi was a bear. are you a bull or a bear? >> caller: i am definitely a bulle. i called this upswing. we're going higher, baby. >> wow, that's pretty emphatic, itself. when can i help? >> caller: yahoo, when do we get that 46 million bid for microsoft back or who comes in and takes it at the latest price? >> let's understand, this marissa mier is making a -- change, she's mixing it up. i think she's doing a great job. i got to tell you, fazi, don't be bearish on marissa. nancy in ohio. >> caller: boo-yah, jim, this is nancy in monroe fall, ohio. it's nice to talk to you. >> i'm trying to visualize where monroe falls is. >> well, i'm halfway between the university of akron and kent state university.
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>> oh, okay. that puts it in more vivid contrast. >> kind of an akron suburb. i'm interested on your thoughts on bottom line technologies that the symbol is epay. >> i know epay. >> caller: the stock had a really good day today. it hasn't done a lot this year. could it be a good growth stuff for 2013 and '14? it pay nos dividends. >> right. i mean, i did this old dog new blog thing in the street today with nicole er k in and her brother ross. there is too many people in that segment. if you just watch, if you go to the old dog new blog which by the way is hysterical, you will see way too much competition. i cannot recommend get i like to go out to akron and kent state. i love ohio. we went out there for the utica shale. it is one of the best we had. i love buybacks.
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i love growth. therefore, i like fb. when it comes to fb, life is high praise. don't forget the linkedin on pullback. buy, buy, buy. stay with cramer. [ male announcer ] here's a word you should keep in mind. unbiased. some brokerage firms are. but way too many aren't. why? because selling their funds makes them more money. which makes you wonder -- isn't that a conflict? search "proprietary mutual funds." yikes! then go to e-trade. we've got over 8,000 mutual funds, and not one of them has our name on it. we're in the business of finding the right investments for you. e-trade. less for us. more for you. the fund's prospectus contains its investment objectives, risks, charges, expenses, and other important information and should be read and considered carefully before investing. for a current prospectus, visit etrade.com/mutualfunds.
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>> it is time. it's time for the lightning round. i tell you whether to buy, buy, buy, or sell, sell, sem. the bell and then the lightning round is over. are you ready? ski daddy, it is time for the lightning round. i start with heather in north carolina. heather! >> caller: hey, mr. jim cramer, a big old 5th grade boo-yah! >> that's my co-word. how can i help? >> caller: i need your help, he my with a question for you. >> yes, sir. >> caller: we want to know about potash. >> it's a feed the world. it's been growing over time. i don't like the fact it doesn't have a dividend. i don't like the fact it's been so erratic.
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i will have to say ixnay on the potash. wow, holy cow, they pulled me faster than clint holliday. let have neil in pennsylvania. >> it is beautiful there, you are absolutely right. jim, i'm looking at pennsylvania real estate investment trust symbol p -- >> it's really good. it's run a lot. it is good. i like it the symbol is pei, prince edward island, best mus sells in the -- mussels in the world. that, ladies and gentlemen, is the conclusion of the lightning round! when it comes to sex, no tr bradley coupers of the world. do have you that picture of bradley couper with me?
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but on wall street, they're sexy and then there's sexy! ♪ >> all right. that's brilliant. >> thank you for taking my call. i'd like to say, i'd like to give a shoutout to my son and my dog in the background there. >> you are intelligent and a genius. >> thank you. >> you are the greatest and a shout out to val dan na and katy. >> valdana and katy are people in our room. >> a shoutout for the crew you do. >> she has a new dress on. can you put the lights on? regina has a new dress. smokin'. it's because her inlaws are in town. it's all right.
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. before we get to tweets, it's time for some house keeping. the wednesday, jeff in california asked me about a tiny $300 million biopharma company. tsrx. trius develops antibiotics for serious infections like cubist pharma. remember we had them here on monday. a superbug killer. these small cap destruction stocks can be dangerous. for instance, last week i told you to avoid abi pharmaceuticals t. main fda was way to rick jim. sure enough if you listen. you sidestep to a decline in stock. tsaro as well as some that disappointed like the dinavacs. i think tesaro, they have a
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certain skin infection drug, it has approval in the second half of the year as long as it maintains its clean safety profile. plus it has $100 million in cash. if it gets approved, it could peak 800 in sales. don't pay more than 650 for this one. if it runs up, wait for a pullback. you got plenty of time to buy it. it's great one of our viewers suggested it to me. on to my tweet itself. let's start with one from ha olay, hail, kid, this one says, know you are bullish on housing, thing spf still room to run? i memorial day e recommend it when it was at 4. i am sticking by it now. people laugh because it didn't go to three after get give me a break. not everything goes up in a straight line. let's take another tweet. this is at v firebird.
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this one says should do on an update on ffball portfolio from last august. been tracking it, and doing well, #madtweets. i'm going to do this gigantic. we did a football, a world series. we will make it a wide world of sports him only okay. we'll come back on. that i want to say on my fantasy football league. i won. i want to thank adam sheffter for allowing me, my help. he did help me. that's why i had kapernik, russell wilson, am fred morris. doug barn. who could come near me. another comes from @pj horna k. tesla, really, really, really, really, really, really, really overvalued now? my research director and i have
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>> to conquer diseases that can't easily be defeated. if you go to karls river labs to do the testing. they can do it faster, quicker and cheaper than anyone else. they are the acknowledged leader. no one can dispute get you can't dispute they had a weak quarter and all that stemmed from big pharma firms not having new molecules that might or might not succeed in beating a hard disease. yesterday when i interviewed charles river, i realized i was talking to the multi-billion dollar dividend boosts behind big pharma. the money they're spending on wall street buying back the stock or paying you a dividend, i believe would money be better spent at charles river, getting the go-no go on new prospects. an incredibly expensive product. allergan tests new drugs on a miss that it had for its new macrodegeneration treatment.
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instead, what many of them are doing is drink harvesting what is already there. what is known, what is in phase 3, not doing the basic research that might not produce new drugs until 2018. now, i want you to contrast that for moment. okay. contrast it with the other cohort that chooses to throw money at charles river. not throw, but you know, spend a lot. that's the biotech companies. while foster said sometimes the spending is inconsistent. it is nothing they would ever scrimp and save on in the end. these companies are risk-takers that are always rolling the dice on something new. they aren't trying to fire people, close down facilities and do anything necessary to make wall street's numbers. is there any wonder really what wall street wants? as well as eli lilly, bristol-myers, pfizer and merck are doing. they are the equivalent of bonds, the big winners in this sector aren't those. it's gilead, cellgene and most excitedly regener on up another
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$266 and change today. all huge risk-takers with healthy pipelines. okay. now let's contrast that with pharmaceutical merck. don't get me wrong here, is probably right now the most adventurous and bombed of the major marm mas. they have 35 compounds in the mix t. crackerjack research scheme run by ken phrasier who is the ce-of-. he is committed to restoreing merck to its old boring. yet, at the same time, he's committed to buying back stock with $15 billion. shouldn't some, if not a large part of that money instead go into research that could be hit or miss? that's not how it's working at big pharma. that money goes back to buying back stocks, plus the new approvals, give the company a decent earnings per share, that plus dividends in merck's case gives you a yield, satisfies everything you need from a
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capital preservation. preservation stand point however, if rates go up, the bonds are competitive with merck. this won't be headed down, it won't matter. cellgene, regeneron on the other hand, they have drugs that could be huge in the outyears. we are paying up for them now to get in ahead of the bill big run in earnings. they are your capital appreciation chips. see, preservation, appreciation. and they can go higher in a stronger or weaker economy. sure, it takes all kind to make diversified portfolio. but the simple truth from the no. 1 testing firm in the country, karls river, is they aren't spending what they need to spend on the long-term pipe liability while that can harvest that research they want, it is the long-term prospects, because we own them for the elixir of short-term growth. don't believe me? go ask the holders of biogen up 50 pars, gilead 50%.
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cellgene up 55% and regeneron up 56%. all since 2013 began. there. i rest my case. changing the world is exhausting business. with the innovating and the transforming and the revolutionizing. it's enough to make you forget that you're flying five hundred miles an hour on a chair that just became a bed. you see, we're doing some changing of our own. ah, we can talk about it later. we're putting the wonder back into air travel, one innovation at a time.
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