tv Mad Money CNBC March 23, 2015 6:00pm-7:01pm EDT
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corp. it's long money. >> guy. >> bp speaks at a conference tomorrow. good looking kid by the way. >> very adorable. i'm melissa lee. thanks ss for watching. meantime don't go anywhere. "mad money" starts right now. my mission is simple to make you money. i'm here to level the playing field for all investors. there's always a bull market somewhere and i promise to help you find it. "mad money" starts, now. >> hey i'm cramer welcome to mad money. welcome to cramerica. my job is not just to entertain but to teach and educate. call me at 1-800-743-cnbc or tweet me at jim cramer. sometimes you have to ask yourself, what if. sometimes you have to challenge your assumptions and call into
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question conventional wisdom. we have to ask what if they were to be proven wong. a good day when dow declined and nasdaq declined .31% all at the end of the day. i have five what ifs that would change the equation for this market right now making people come to their senses and understand that the trends cha can be your friends may have become a lot more friendly than you realize. the first what if what if the dollar has stopped going up or at least it's not going to go as high. if you wind the tape back to a week ago before the fed meeting we presumed that the dollar was going in a straight line to trade one for one with the euro. the exchange rate did approach near those levels but the fed told us rates weren't going to go up so the euro got stronger. that matters. so many hedge funds believe the stronger dollar can wreck the finances of whole countries
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overseas and cause so much pain for so many multinational companies. hardly a day goes by when we don't hear about the big internationals going to be crushed by the strong dollar. but what if it's not true? in that case the pharmaceuticals and tech stocks they would be too cheap. consider that imb may be the most visible and has now gone up ten straight points without the company saying or doing anything. that's because the dollar has gotten weaker. i was shocked that coca-cola didn't get hit at all. man that was some slam. why was ko not knocked down? simple even as coke is hedged against the weak euro it isn't against other currencies that did better against the dollar. you think j and j went to 103 on nothing? that's the weaker dollar talking again. if the dollar stopped going higher it would catch tons of
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people by surprise and the majority of hedge funds would be on the wrong side of the trade. the second what if what if europe is actually getting better. we're starting to see real growth and we're seeing germany become this monster locomotive that could pull the rest of europe forward. we forget that germany used to be the locomotive in the 80s. of course we have a major german greek show down. when greece runs out of money sometime in april but let's rewind the tape to 2011 when greece was the most seriously in trouble. if you gave greece a break you'd have to give portugal italy, ireland, spain a break too. everything looks better and they're having no problems financing their debt. there's no reason for them to come to germany hat in hand and there's no reason they should care if greece is kicked out of the euro zone. the whole down side can hurt the stocks. what if greece is given the boot. what if greece is given a decade
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to get it's act together. either way is fine. come on. the third what if what if oil has bottomed. oil is stronger today because of the weak dollar but take the dollar out of the equation for a moment. the simple fact is two of the savviest oil people i know in this world, two with really clear heads, two companies with gigantic pipeline systems that can pier into the pipe and see the real oil market both said there's genuine demand for crude at the $43 level. when oil hit that level at the end of january they said oil didn't belong in the low 40s because real buyers want to lock in at those levels. 43 second time last week. have to ask, why did he never sell a single share of his company during this period and why did he actually buy 100,000 shares on the open market about a week ago. all i can say is he doesn't even
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have one. i know it's sheik to say we're out of storage space in this country. but here's something worth pondering, then theoretically we have no need for oil imports alt all. so why are we still importing 7 million barrels a day if we're out of space? because there's real demand for oil. the fourth what if what if the apple watch which comes out next month is the real deal? what if we decide it isn't a watch at all but a health device that also tells you the time. what if we decide on one arm we need the traditional watch and on the other arm we need our health maintenance. i'm not getting rid of my current watch but i have every intent of getting the apple watch because i want my vitals monitored. i was talking to a college president who is a terrific guy and my phone started going off in my pocket. i felt the buzz. i was expecting an important call that would have determined
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whether i was going to be in good shape or going into the dog house for the foreseeable future. if it was the call i was jeopardizing the conversation but it was worth it but if it wasn't the call i would have looked like an idiot. i needed something that showed me who was calling in a way that would have been less obvious than pulling out my phone in a conversation. i needed the iwatch that told me who was calling. i asked not taking the call. i was wrong. it was nasty. i thought this was all one off until ten days ago when i was giving a speech for mad money's tenth year anniversary and my phone went off again. having just gotten out of the dog house i figured i better take it so in front of everyone i took the phone out of my pocket. wrong. it was nobody i needed to talk to. a quick glance of my apple watch would have shard me a lotshared me
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a lot of embarrassment. it's the ialarm. the 5th and final what if what if social media is taking a larger share of advertising dollars because of mobile adoption. what ifs so we he con nektd everything including our bank account. have you seen the stocks in they're attempting to break out particularly intraday. i think you'll begin to ignore it at your own peril. what if oil is done going lower and europe is dub getting weaker? what if the apple alarm takes off and now there's a handful of television stations with amazing programming that's live. that may be what we're seeing right now and if it is this could be the pause that refreshes. i need to go to russ in arizona.
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>> a big booyah from a first time caller. >> all right. >> i was wondering down here in arizona with over 300 sunny days a year one of the rapid growth industries is solar aenergy and i'd like to hear your comments on the current status of solar power in the u.s. and worldwide. specifically i'd like to hear your comments on a company that i own, ja solar. >> they're okay. i've been favoring first solar. ja solar i'm inclined to a little bit here. kevin. >> good afternoon, jim. >> how are you? >> i'm good. i'd like to thank you for all the great work you do. i'm looking at magnum hunter here. what do you think?
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>> i think it's okay. i'd like to see a transaction by magnum hunter to be to liquify the balance sheet. let's go to john. >> i love chevron and i came across something, eni. i think it's a go. i wonder what you think of it. you know what that's not a bad idea. it's got 8% yield. when i see 8% i think they're going to cut it. that may not be the case but that's been the way when you see a yield that high it gets me very nervous frankly. i prefer royal dutch which a lot of people think will cut the dividend. sometimes you have to ask
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yourself what if. these what ifs change the equation for most of today and people are finally coming to their senses about some of these trends that are going to be contrary to what you think might happen. mad money unveiling the names of connectivity and tech. then pottery barn took a hit after the latest quarter. maybe they got it wrong. plus 3m, the industrial giant with the science to make it all possible. i got an exclusive with the ceo. stick with cramer. don't miss a second of "mad money." follow @jimcramer on twitter. have a question tweet cramer, #mad tweets. send an e-mail to madmoney@cnbc.com or give us a call at 1-800-743-cnbc. miss something, head to
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qualcomm and intel, we come away with a profound sigh simply not working anymore and we have to wonder about the whole group. same with western digital and seagate. they're all down for the year. many down double digits and they're flashing red for the whole personal computer component sector. does this mean they're finished? that there's some sort of secular decline? hardly. it just means these particular companies are into the personal computer. and not the revolution connectivity which is the most powerful trend today. it's about as strong as i can ever seen it. a fantastic leadership cohort. it's dominating all tech at a time when software hardware and the internet and some clock stocks are churning. first and foremost i like sky
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work solutions. a dom thants parts maker for cell phone which is is the main way we get our information. sky works run by david aldridge is all that's good in the semi world and can be found in smart homes, smart cars t the wearables, these are the frontier of the future. if there are going to be 70 billion connect devices by 2020 it's probably the best place to profit from the revolution. sure it could be like a bio he tech but you have to buy it. i could make the same case for a most of others in the group. now you have another utility conductor that specialized in touch, wearables and lightning. they operate in similar connected markets with the fast growing data center business and big communications like wireless
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base stations. but it also does medical image systems and patient monitoring. samsung is coming to the fold too. how about the company created they choose to go head to head on radio frequency for cell phones. they're meant to do one thing, change the balance of power between them and the cell phone makers. how do i know this? it's on their website. offer better bargaining power and make it harder for customers such as am and samsung to negotiate prices. two thumbs up. i like also the communication specialists and xpi semi. these mergers create a one stop shop for devices to talk to each
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other. they provide the cell phone base. best in class audio technology. the company is able to stay independent because it's able to keep ahead of the competition. now given the runs in these stocks you can say you missed the move. would come back and say how could you be so pessimistic given that we're in the early endings of the revolution and i think these companies are going to be the inobstetricals of this year. they're leaving others in the dust. get used to these semi-conductor stocks. they'll be the household name leaving the legacy pc component makers behind along with the personal computer itself. it's going away as the main method of excessing information in this country and the world. much more ahead including william sonoma and it's not just lint rollers and scotch tape for
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i'm always telling you to do your own homework. especially during earnings season. i couldn't resist. you can't always take the market's judgment about a quarter for granted. it's causing the market to misjudge a company's results entirely. that's exactly what happened to cramer fav william-sonoma last week. the terrific home furnishing retailer with tons of brands as well as pottery barn west elm and rejuvination. they reported a not so hot quarter which many consider disappointing because the results were seriously impacted by the west coast port slow down. b even though the company delivered in line earnings it's revenues came in light while same store sales were the lowest in two years.
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up just 5.2% much weaker than the 6% number wall street was looking for. meanwhile they gave down side guidance for the quarter and the full fiscal year. these numbers look sorrowful. especially when you consider they have done so well for so long. they were falling more than $2. do you know at one point the thing was down more than $4 before people heard what the company had to say on the conference call. however when you dig deeper you realize they're not a troubled company facing tons of difficulties. in fact it's a fabulous company that got hit with one big problem, the west coast slow down which ended a month ago. they get the vast majority from asia. they had a ton of merchandise sitting off the west coast in big containers waiting to be unloaded. this company was uniquely hurt by the slow down. remember the labor dispute is now over. so things should eventually get back to normal after this
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current quarter and next one. they actually delivered a terrific quarter. that's right. these results that the market turned up it's nose at were quite excellent if you're willing to do the homework and dig deeper than the headline which is by the way, most people just aren't. drives me crazy. the underlying business is in good shape. consider the same store sales the worst in two years, it sliekly shaved 1.5% off if not more. that's a substantially better than expected number. pottery barn in particular was really hurt by the port problem with same store sales coming at 2.9% across all three sub brands but pottery barn's comps would have been closer to 6% and the weakness was caused by the supply chain because customer demand was strong. people went to the website. people wanted to buy what they were selling but so much of the merchandise was held back or put
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on back order and they were turned off when they say the way of the order and shipments would occur unless they didn't order. they looked deep and saw they couldn't get the stuff and they went elsewhere. you know what if you took the trouble to look at william-sonoma's own guidance they were able to hit the midpoint in spite of the port problem. that was impressive. the slow down is a temporary issue. it's not going to be a problem again and by the second half of the year as for the allegedly weak guidance i'm not worried. they're doing so many things right on so many levels this company will be able to raise track record in the not too distant future and if you took the time you'd feel more confident. they're exactly the kind of company you want to own in this environment. aspirational luxury goods. the stuff looks so good but not too expensive.
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perfect for my beach house. this is a house of brands with many growing rapidly. they're trying to capture the customer's imagination and then keep them for the rest of their lives. that's so smart. at the name sake william-sonoma chain they're allowing market share in cook ware food and entertainment. as for west elm the numbers were blowout. phenomenal. company rapidly putting up new locations and the existing stores are on fire. they had 19.6 of% same store sales growth this last quarter. staggering. on top of that there's two he menching brands for luxuries and accessories accessories. i haven't used that stuff yet. perhaps the most impressive thing about this quarter, the thing that really blew me away the dominance of the digital business. company has gone all in on the
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west. this is astonishing. are you listening? 50% of its sales. 50. i think they're the first company that's been able to beat amazon in it's own game. their business is the envy of the industry. and some of the fastest growing online brands out there. in the last quarter they increased 14.7%. how is the company managing to succeed there. part of the secret is because the fact that so much of the merchandise is private label and exclusive. you can only buy it there. you can't get the stuff from amazon. that's why this company only has 25%. it's apporiatary. it's compete with amazon online and they rarely ever win. william-sonoma found a way to out compete amazon while
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increasing the pricing power. they are the envy of everyone. they're 1200 basis points higher than the retail store side of things. they have become more profitable. gross margins expand. it's logged you in from the port slow down and gets poured out. selling consumers the things they want. in short i think people have this quarter all wrong. aside from the west coast port show down the quarter was fabulous. companies showing a rare mastery that makes this the one retailer that you can't sell. the fact that it was trading below where it was icing on the cake. let me give you my bottom line. in my view it's a steal at these levels. you can't let a problem finish port slow down scare you away from a high quality stock for the next quarter. it's as high quality as they come. i'm telling you, two quarters from now when the port issue is
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forgotten this stock will be a lot higher than the opportunity to buy it. let's just say it will be long gone. john in florida, john. >> caller: cramer i'm look at skechers here. >> did you see that break out today? >> caller: say again? >> did you see he the break out in skechers? >> caller: yeah i was trying to get it friday. i was talking to your other producer but it's 1440 or the 65 at 1080 july. do you think it's still got room to run and get in? >> obviously it was breaking out. the stock is incredibly cheap. management is fantastic. i don't like to buy things on the spike. who knows, that stock could come in but have to tell you have to consider it and i have been such a champion of it i'm not going to try to get you away from it.
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now it's too darn good. i want you to pull up a chair and listen up. i think people have william-sonoma all wrong. pull up a lawn chair or a raft. it's a steal at these levels. it's going higher. much more mad money ahead. where's my post it. can the company behind everything from scotch guard to auto parts tear it up? i have the ceo. don't miss my take on some of the players you never heard of. i'll unveil them just ahead. plus why don't we start the week right with an electric addition of the lightning round. stick with cramer. ick with cramer. ♪ ♪ ♪ (under loud music) this is the place. ♪ ♪ ♪ their beard salve is made from ♪ ♪ ♪ sustainable tea tree oil and kale...
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some companies are so consistent, so well managed, no innovative that they deserve a core holding in anyone's portfolio. take a long long long time cramer favorite 3-m. when you hear 3-m you probably think about post it notes or scotch tape but this is an innovative company with strong businesses in all sort of end markets. health care, electronics, graphics and the consumer. the company is constantly inventing muscles products taylor made for various reasons all over the globe. the latest quarter report was much better than expected despite the impact of the strong dollar. it's been hurting the numbers for all companies. if you look at them the organic growth came in at an amazing 6.3% with the company showing strength all over the globe. it's a 2.5% yield at these
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levels and given a terrific return. i think the stock has much more room to run. don't take it for me. let's check in with the chairman and ceo of 3-m. hear more about his company and where it's headed. welcome to mad money. >> thank you. thank you for having me and congratulations to the ten year anniversary of mad money. i try to be here last week but unfortunately it didn't work. but congratulations to you. >> well we are thrilled to have you, sir. and one of the things i love about your company, really something you have done you reinvent the company every few years so why don't you help our viewers by saying how many of your products didn't exist five years ago and how much is that responsible for your growth? >> well today that's around 32 to 33% of products that didn't exist five years ago. we call that new product fertility index which is an
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important element for us. the primary growth of course organic local currency signals so when you see we had a target of 3 to 6 and we came in higher last year the new product flow is helping it relative to growth. so it's a very very important element and that's also why you can stay relevant to your customers. a very important metric we're focussing on. >> you are to me the most international of american companies. how does that help your company grow? >> well first of all, i think it's important if you have decided like we did many years years ago that we would like to be part of demographic change. that's happening in the united states and all over the world. that also means that you need to get leaders in place that
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understand context which i will call context intelligence and i think 3-m over many many years have done a good job to develop leaders. so when you think about my team today and as you know i have lived many places around the world but the team today in management they have been born and raised in canada australia, united states, korea, spain, saudi arabia and india in addition to sweden and the rest of the team they have lived places brazil russia japan, belgium, u.k. hong kong and south africa. you take that together you will understand the context of how to do business on a global scale and that is an important element for us in our model. >> i think that it's important for people to understand in what real life what this means. you like to convert local mega trends to commercialization. let's give people the example of china and air and water quality
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and with a you're doing. >> yeah so i think most people see and understand it and that can be very academic to be honest. you see it. you try to understand it and you can put the dashboard together. i think the power is when you can be in the country and really understand what is happening here in my specific country. so in china, in addition to that economy is not shifting but expanding to more domestic businesses. there's three big mega trends there. one is air pollution. one is clean water and the third would be is food safety. we play if all of them. if you go into air pollution with our technology base which is woven that's where we develop respirators very specific for the chinese market to their needs and it's an important element that we can use both global mega trends but then be
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very specific with local capabilities in terms of research and development but also manufacturing capabilities based on what that market is telling us. >> at the same time you run an operation financially. you returned $7.9 billion to shareholders. you care about portfolio management, investing and business management transformation. this must be huge decisions for you as the ceo. >> well one of the key objectives is to make sure that the allocation is correct. and we have been more aggressive relative to the balance sheet which can be appreciated by most if not all.
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i think that's where the first should go but think about our history, we have had now 98 years without interruption relative to pay dividends. we had 57 years for an annual increase. we're now seeing in 2015 an increase of 20% followed by the year before with 35%. so we have very strong balance sheet. we have a very strong operation. we are a sustainable model generating a lot of cash. we get the freedom to do all the things you're talking about. that's an important element when you do business in the long run and 3m we're in the business for the long run. >> i can't resist because you keep mentioning the word element. your website has a periodic table of elements that has all of your new products. that something that you care passionately about? trying to get people to understand the glaetness of 3-m? >> well i think the important
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thing is we have 46 technology platforms and they can be combined for solutions but more importantly it's the way in the front that we take in information. we have two processes that we use. one is called customer inspired innovation. the other one is called aidea to information. when we take in information it's tailored specific tloi customers and customer inspired innovation model or eye to eye which is more consumer-related model. those ideas are coming in. i said there's 46 of them. it's one specific division or one specific country or subsidiary. we own it as an enterprise meaning there's an open innovation inside of 3m and out
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with our customers. so if you take one of the platforms, let's say nonwoven technology. we're producing respirators which is around safety for people and consumers. we have both the water and air filtration and then we have the brand most people see. of course you see it on jackets, shoes, caps but you will also when we take a plane and fly away there will be material in the plane and you will have the same in the car. so if you think about it we touch consumers. we touch industrial we touch people. so 3m science applied to life is a good example coming from only one of the 46 technology platforms. >> that's a great way to leave it. thank you.
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it is time. it's time for the lightning round. then the lightning round is over. are you ready? it's time for the lightning round. ed in florida. >> big booyah from florida. >> i love it. what's shaking down there, partner? >> oh, man, i tell you i love your show. i have been watching it for ten years. you guys are the best. >> the staff makes me look great. ten years of the same staff. what's going on. >> my question today is about lowe's, low. >> oh man, that's a featured
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performer of my charitable choice. home depot too is real good. why don't we go to larry in california. larry. >> jim, it's an absolute pleasure to be able to talk to you. >> thanks for calling. >> you're my idol and you have made me a ton of money. >> wow, thank you. go on twitter and say that to the jerks that are accusing me of torching the biotech group. >> if you're ever in palm desert i'd love to buy your dinner. >> i love it. >> how much further will bips go? >> it really is just the best of the lot and i think it can go higher but i'm not crazy about the chinese market. this one may be overstaying it's welcome. how about we go to brett in california. brett, maybe verna.
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>> yes. >> how are you doing? >> okay. thank you. >> quite welcome. >> my daughter has inherited some money so she is a new investor. she is looking at -- >> start pulling the trigger. i met with those guys last week. two thumbs up and i begged them to come on the show but it was not listened to. can i go to christian in new york? >> hello. first i want to tell you i love watching your show. >> thank you. >> the stock i'm inquiring about is service corporation international. >> that's a good stock. it's in the death care business and like it or not that doesn't go out of business. so death care, good stock. let's go to illinois. >> booyah mr. cramer how are you? >> i couldn't be better.
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thank you for asking. how about you. >> oh fine thank you. could you please tell me what you think of the stock mobile eye. >> too speculative for this guy. no thank you. and that ladies and gentlemen is the conclusion of the lightning round. >> the lightning round is sponsored by t.d. ameritrade. e.
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space today i want to say why i feel your pain i also warn you to pull back just slightly. it happens. they had an enormous run and that kind of move always breeds profit taking eventually. this time last year they also rallied massively and then got crushed because a wave off ipo flooded the market with supply and people wanted to take market because they had them and that's what happened now. i don't blame you for blaming me for starting the sell off even though forces well beyond my control triggered it. i had nothing to do with it or some paper or show or website would have attributed to me. but let's take this pause in the group. to circle back to the names i punted on. i never like to give you an off the cuff answer. which is why if i don't know enough about a company i just need to say let me get back to you especially for the biotechs.
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tonight i want to share with you what i think about several of these companies. for starters back on february 18th roman in ill asked me about xon. that's a stock that's up 59% year to date even after tumbling in today's session. it's a cool thing. it's a player in the synthetic biology space which means they create biologically superior products for ago, energy consumer. it became public in august of 2013. since then it was range bound forever in the 20s but since 2015 began it's on fire roaring up to $43 and change. what caused it to ignite? first the conference in january which propelled a lot of the stocks. in a deal that gives them exclusive rights to my intellectual property.
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they had more than 31% on that news. then last month they got phase one very early but phase one data on a drug for hospital induced infections. dealt with synthetic biologics. we're managing to turn a profit. also announced that it's bringing ten new therapeutic projects this year. it's a good story. especially with accelerating revenue growth but it's hard to figure out how to value the thing. it's trading at 30 times sales. it just reported a quarter where it generated only 30 million in revenues and not profits. i think you have to let the stock come back down before you consider buying it. everything they have is an early stage. what else have i been asked about? back computer march 10 joe wanted to know about avalanche biotech technologies. it's down and down big and avalanche hit it.
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falling 20% since the beginning of the year. it's the developer of gene therapies including a longer lasting treatment for macular degeneration. remember cramer fav regeneron was better than everybody else and based on early trials looks like the formulation could last even longer. avalanche became public in july of last year at $17. back in january the company did a 2.5 million share secondary. then the stock got hammered at 33. a matter of weeks. since then they rebounded without much news from the company. it could be a promising speculative story long time. i still like regeneron but i can't endorse this stock all the way up here. the stock has recently gone into the companies a analyst day this wednesday. the time to buy avalanche was
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$10 after it got pancaked by the secondary offering. finally last thursday mark in tennessee called in about northwest bio therapeutics. that's a tiny $500 million bio tech. up 41% year to date. it's a development staged bio tech with a platform where they used activated cells to mobilize a patient's own immune system to attack many differ type of cancer. it actually became public in 2001 and collapsed shortly there after. lately the stock has been roaring because they got approval from health canada. a phase three trial, the main drug in patients with brain cancer. at the end of the day i think it's simply too speculative for me. too risky. it's a money losing enterprise
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that only has 13 million in cash on the balance sheet at the end of december. plus northwest bio has been rebuked by the md anderson cancer center for what they called inappropriate and unjustified claims about the results of an on going clinical trial. he has been negative on the stock. i tend to trust that man's judgment. i disagree with him on very big bio tech stocks. maybe it will be a huge success but i think the risk reward has gotten too dangerous. go buy yourself a cashmere sweater. this is not the moment to play with stocks losing money and might not have major products on the market for years to come. the biotechs had a if he fomalphenomenal run. take some money off table. after the break i'll try to make you some money.
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you some money. m are doing rain-fed agriculture. they're all competing with each other; they're all making very low margins making enough to survive but not enough to get out of poverty. so kickstart designs low cost irrigation pumps enabling them to grow high value crops throughout the year so you can make a lot of money. it's all very well to have a whole lot of small innovations but unless we can scale it up enough to where we are talking about millions of farmers, we're not going to solve their biggest challenge. this is precisely where the kind of finance that citi is giving us is enabling us to scale up on a much more rapid pace. when we talk to the farmers and ask them what's the most important thing. first of all they say we can feed our families. secondly, we can send our children to school. it's really that first step that allows them to get out of poverty and most importantly have money left over to plan for the future they want.
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35 million shares were filed after the close. a lot of people thought they would get a bid. no just a lot of stock coming at you. a lot of selling in the oil stocks even if there's not selling in the oil price. there's always a bull market somewhere. i'm jim cramer. i'll see you tomorrow. ee you tomorrow.
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[ cellphone chimes ] >> it's friday night. what better way to get it started than with an ice-cold beer? it's one of the world's simplest drinks -- mostly water, a little alcohol. but behind this simple drink is this -- a giant megafactory, packed to the rafters with high-tech equipment, thousands of beer makers, and millions of gallons of beer. heineken's home plant tips the scales as the largest brewery in europe, all of it dedicated to a glass of that age-old brew.
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