tv Mad Money CNBC May 7, 2015 6:00pm-7:01pm EDT
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$41 low that b.c. cited. >> i'm melissa lee. thanks for watching. don't go anywhere. "mad money" with jim cramer 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. other people want to make friends. i'm just trying to save you money. my job isn't just to entertain but to teach and coach you. call me at 1-800-743-cnbc. or tweet me @jimcramer. i say be careful what you wish for. it might actually happen. and maybe you won't be ready for it. that's how i felt watching this
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whole session unfold with the averages starting of course, but only finishing higher. the dow gaining 82 points. s&p advancing, and nasdaq climbing 0.53%. a terrific set-up. a set-up for the bulls. thanks to five major positives. oil, the dollar, excessive pessimism, interest rates and good earnings. all of them went the right way today. buy buy buy. let's take them one at a time. so you can understand what made us feel so much more sanguine. first, need oil to stop going up. then ultimately plummeting two bucks. the rallying and the consistency of the move, the sheer viciousness has obliterated the positive stories that have been driving whole swathes of the market. when you get a huge increase in
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the price of oil, it amounts to the tax increase on two-thirds of the american economy. and it's consumer based. you better believe that's a gigantic buzz kill. from the lowest at 43 to the peak yesterday at 62 bucks and change, oil was up more than 42%. and if you look at it, it was like this. and if you -- go and look at the charts of any of the retailers of restaurants or airlines, you'll notice it was like that. there was a peak in the stocks that coincided with the bottom in oil. the action has been all bad since then. so bad that it almost doesn't matter what these companies said in the conference calls or or what numbers they delivered. don't me? hit up the airlines, they have been acting like death. until today. when they were coiled springs traveling dramatically higher. relief rally, don't know yet. check out the action in fiesta
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restaurant group and sonic for the last couple weeks. they're both on the show tonight. these two companies reported remarkably let's say consistent quarters. pretty good numbers. all right, not to shoot the lights out, but good. denny's, darden jack in the box, yet they all look the same. didn't matter what they said. you have a peak and then a bruising. even though all we heard was relatively good things. why didn't they rally? why didn't even the best of them rally? why weren't they obliterated after relatively good reports? because big portfolio managers are always trying to figure out if the earnings of a company are peaking. that's a big game they play. and with each of these stocks their judgment was this has to be the last good quarter. that the good quarter is signalled to peak. the only restaurant stories that went up were international and activist. like domino's international and
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yum! took off because of actavis. if you missed the quarter or guided negatively then you had a noodles on your hand. or lesser you had, yes, a chipotle style implosion all because of the rally in oil not what the companies were saying. so a day like this, when oil went lower was a god send. a reason to cover your short positions in the airlines. rest assured you know the correlation. stop kicking about why jack in the box is well off the highs as so many of you do in @jimcramer on twitter. i want has nothing to do with how well the company has been executing. this is perfect. it didn't suddenly back hack in the box. it's just that the consumer has less money and the presumption is you'll spend less too. it's a reasonable assumption. oil hurt disney. that's right. think about it. disney reported one of the best quarters ever and it's down ever since. you have to wonder if the big driver that is theme parks, boy, were those numbers strong, could still stay strong if gasoline goes higher.
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i say yes, absolutely. because of some technological changes in some new rides but for the moment all i'm doing is describing how the price of oil drove the near term performance not of the companies, but of the stocks. second, oh boy, we need the dollar to stay weaker. at least not get stronger for some time. now that earnings season is through, we know that analysts and iner haves did not look through currency. they won't say, i won't let that phase me i'll act as it's constant. no, there were no free currency passes. we know if a company's sales or margins were hurt by the strong dollar the stock didn't go higher. it went lower. what made this really difficult though was that the money from big international companies have been rotating in and you saw that happen, that was shut off by the rally in oil as well as the inflation fears that stem from higher commodity prices and
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wage gains. almost every commodity has rallied from the lows. ise making us -- it's making us nervous about raw cost in inflation. we had to take back some of the gains from the consumer packaged goods. we were thinking gasoline oil, plastic comes down. gross margin go higher, that may not be right. plus the international companies were making major concessions to keep business from going to competitors overseas. we weren't competitive. today, the green beck didn't do nothing, hoping we can see the end of the dollar that's weighed so heavily on the stock. the bad news has made people really pessimistic. man, is it ever, a wall of pez him. we almost expected stocks to go down. it's a rare occasion they go higher. the charts, they're almost uni formally horrible. you know they look terrible. the fear that we have seen in
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the last good quarters from the whole host of sectors is becoming green. when i woke up at 4:00 a.m., we saw the german bonds get hammered again because business is coming back strong in europe. you know what though we're so negative we don't think, wow, how terrific, europe is rebounding. we think, wow, owners of bonds getting hurt turmoil, pain more selling. just as i abhor big openings i like it when the market is looking down on the open. if you have your shopping list you can buy when others are panicking. years ago, warren buffett -- no, it was monday, warren buffett aforimism aforimism, you want to buy the stocks that you like. the pessimistic icing on the cake, yesterday's comments from janet yellen. the stocks were overvalued. doesn't matter she was wrong before. she took the bull and shot it with a bolt to the head. yet that's the pech -- perfect
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environment for the well spring of a rally. you need that negativity. you need to -- you need the skittish people to get washed out. so stocks can be put in firmer hands. then interest rates. they can go up pretty much every day. but i don't talk about it enough on the show. i get the feeling they're going to overrun all the stocks with a juicy dividends as that's what tends to happen when interest rates ramp. today though rates went down. and while maybe just a brief bond respite, it changed the landscape for the better. and you may have been disappointed by the same store sales from whole foods, and surprised that tesla didn't explode 20 or 30 points except that what happens to cold stocks. you could have been perturbed by the number from keurig green mountain. and the conference call was
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worse, that was terrible. you want to own that stock and monster through the shareholder that is coca-cola. but we also had some huge upside surprises today. none bigger than alibaba which reminded us it can go higher. just as significant maybe more so for those who follow tech, the amazing quarter from corvo. corvo is a semiconductor company. tell us on and why you didn't call yourself trimf or something. it provides key components to the cell phone industry and the read through was simple. the industry including the key customer apple is alive and doing fabulously, that was a fabulous conference call. real good news for semis, so the glaring declines in skyworks solutions, eva ga, semi the other big three and high flying
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tableau software data delivered a terrific quarter. as i said on friday, that might spur another rally in the pricey mob that's mobile social internet of all things. so far, every day like this in 2015 has been pretty much a one-day wonder. with everything positive getting reversed the next session. okay. we have to prepare for just that as we have that huge employment number tomorrow at 8:30 in the morning. but let me give you the bottom line. you know what, today -- you know what we discovered today? if you get lower oil, a dollar that doesn't do anything, positive earnings on top of a slew of pessimism, guess what? the market will lap it up. it loves lower rates. it loves lower gasoline. it loves a group of things that give you a recipe for rejuvenated stock market. it's a rarity, but it's no longer impossible. it happened once so maybe it can happen again.
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renado in pennsylvania. >> caller: jim big bad booyah to ya. jim, i have been reading a lot about the drought in california. and i know lockheed martin is, working on desalinateing the ocean water. >> look, lockheed martin along with general dynamics and northrop grumman are my favorites. i like harris too. and orable. but you like lockheed martin because you're hoping for overseas orders because we're not spending on defense like we used to. but lockheed martin is more of a play on the international desire to defend your country. since we're not going to do it for you anymore. ray in florida. ray? >> caller: hey, jim, thanks for taking my call. >> no problem, ray. >> caller: i noticed yesterday that the bank of america stock fell after the annual meeting. what's your opinion on that stock?
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>> i talk to stephanie link remember we used to do a lot of stuff with action alerts. we are saying when is this one going to take off? it is an inexpensive stock. that's what i say, it's inexpensive. however, there are other banks i like more. notably wells fargo. which we own in my charitable trust. the bulls finally had it made for them today. but unfortunately they may go back in hiding again tomorrow. be prepared. on "mad money" what's going on with sonic, the fast food player received up a hot quarter, but investors still passed on the stock. we have to talk to the ceo. then things are looking up across the pond. i may have found the perfect way to play it. i'll reveal it just ahead. plus is fiesta restaurant group losing steam? the stock was en fuego last year, but it hasn't brought the heat in 2015. i'll see what see what's cooking with my interview with the ceo. stay with cramer! >> announcer: don't miss a second of "mad money." follow @jimcramer on twitter. have a question?
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♪ for months restaurant stocks were the hottest group in the market because the price of oil was plummeting. this is one of the most direct beneficiaries of cheaper gasoline. and then they went radially out of favor. take sonic across 44 states when sonic reported in late march they delivered some of the best numbers of the quarter. 11.5% same-store sales space.
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but the management was conservative so instead of rallying, well, the stock got slammed and it's been in the doghouse ever since. puzzling. so now that the stock has pulled back is it time to do some buying? sure the price of oil has rebounded but still below what it was a year ago. and as we know, sonic is a well-run company. terrific concept. and though it's in 44 states its locations are much more highly concentrate in the south. got a lot of room to expand. the stock has given us a fabulous 37% gain since we spoke to the ceo 11 month ago so let's dig deeper with cliff hudson the chairman and ceo of sonic who last month celebrated the 20th very of his taking the helm. he's been at the chain for 30 years. mr. hudson welcome back to "mad money." >> thank you, jim. it's a pleasure to be with you. >> well, it's great to have you on. first, a surprising announcement today because it was not april
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fool's day. mcdonald's is fighting to reinvent itself. kale. you had a kale announcement last year, didn't you? >> well we had a kale announcement, but it was april fool's day as a matter of fact. we said to folks try our kale shake on april fool's day. so but in fact, we didn't follow through. we had fun with it. but nobody asked for it either. >> right. well, i'm trying to figure out, you guys are doing -- because the stock is down. all that i see that you guys have been doing exactly the statement thing you have been doing for years and years which is making big profits and the market rotated out of the restaurant stocks, not sonic, not doing the right thing. >> right. our business continues to be healthy. the things that are driving it are a differentiated product. our guys are creative great service with differentiated food, made to order food. all the things continue on. they were great on the roll through the winter and they continue to be on the roll this
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spring. it's very much part of our dna. so our business is very healthy in spite of the stock moving around a little bit. >> one of the things that was interesting in one of your presentations, your day parts are radically different from any other. you have a huge afternoon business that nobody else has. >> yeah. almost a quarter of our business comes between 2:00 and 5:00, but we focus on breakfast, lunch, afternoon dinner and all five parts, that we call blade. we promote them separately. we have different products to align with them and we have different customers that use the day parts differently. so it's a very important part of our strategy. has been for oh, 15 to 20 years now. >> the other thing that you guys do that no one else has is this points of personalized service. people don't expect sonic to be at the forefront of technology when it comes to the customer but i think you are. >> well, we will be implementing over the next several years so we're implementing this now in
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addition to new point of sale service. the technology interface at the drive-in stall with the average custer many. it will integrate with social media, our own app that the customer can utilize on or off premises for ordering and paying and integrates with social media off premises and on promises. while we have this now in only about 800 stores out of 3,500 in the system we'll roll it out through 2015, 2016, 2017. i'm quite confident that that engagement with the customer on and off premises in a differentiated way will kind of mirror what we have our differentiated food made to order food and using the technology in the same sort of way. this is going to help drive traffic and drive loyalty over the next several years in a very sonic sort of way. >> all right. well, i think that the case for the company and stock are clear.
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but the one thing that did confuse the analysts is the buy back, whether it's done or going on hold. you have been one of the most aggressive buyers of your own stock. i'm assuming that nothing has change and we'll get good news in 2016. >> nothing has changed from that standpoint. we continue to buy back our own stock. we as a franchise company, we generate a lot of cash flow. and this is one of the good uses for it from our standpoint. we're very optimistic, very bullish about the business. we continue to buy back our own stock. >> okay. because i thought that the authorization was kind of done for 2015. 2016. sounds like that you're in there. >> yeah. there's still a little bit left for this fiscal year. but we'll in the coming months talk about next year as well. but the fact is as the business generates the sales that it does and as a franchise company and a royalty stream and an ascending royalty rate we'll continue to buy back and the stocks will be part of our use of that cash.
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>> well, we're getting a real chance to buy sonic. i was surprised it went down so much. cliff hudson, chairman and ceo of sonic. congratulations on your 20th anniversary at the helm sir. good to see you. >> thank you. i appreciate it very much. >> guys, look, i know it doesn't seem it's the right time to buy it because gasoline is going higher. but this is down huge. this is a well-run long term situation. i would buy some. "mad money" is back after the break. coming up -- losing steam? the stock behind taco cabana enjoyed a sizzling 2014. but the fiesta restaurant group has struggled to stay spicy this year. can it start turning up the heat again? cramer's checking out the menu with the ceo.
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selle is sell sell. we can look at the stock and bond route around the world that's been happening till today. the one that's created more than $2 trillion losses in two weeks. and we can certainly run for cover. or we can take a look at what's causing the route and find the winners the winners being made right now because of it. it's difficult to separate the emotions of the losses from the cold, hard precipitating facts and that's what you have to do
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if you want to be a good investor. others are blaming the rise in the dollar or the vicious backup in the european rates or the feds raising the rates possibly because of inflation. what has really changed underneath it all? what is fundamentally different that ease caused the turmoil? i think europe is getting better. i'm talking about spain, portugal, italy, france. all of the other countries by the craziness of greece. that's happening because the european central bankers created a situation like here. remember when the fed got uber activist activist? you don't want to own anything other than growth vehicles. yeah you wanted to buy anything else any other asset quality. any other asset had greater value than their bonds. and they still do. even if your bond yields have increased because they have only
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increased radically on a percentage basis. i would never buy a bond in europe right now. the moves by the central bank may have been unorthodox. but like it or not, they're working. don't hear enough about this. europe's gigantic economy 77 million people it's humming. when an economy improves many things occur. more people get put to work that's good. sales increase good. profits grow, good. lending resumes, good. bad debts go down, good. tons of things that are good. which brings me back to the original question about pick winners. when we're buying stocks it should go higher because of the huge and positive sea change. let's take a look at ppg. run by ceo chuck bunch which is the biggest most lucrative coatings company in the world. for boats, homes, cars, all sorts of paints. they reported a miserable
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quarter, sales increased only 1% year over year. it's down nearly 3% this year. why the weakness? because it does about a third of the business in europe. that's why. europe hasn't been that strong. worse, ppg in a dogfight against european paint companies and the prices are too high relative to theirs because of the darn strong dollar. when it cashes in, the euros on what it does sell, mainly paint, bmw and mercedes, there are fewer dollars left over because the euro is so low. but consider the following things that have occurred. europe has gotten much stronger versus the dollar. no one thought that would happen. the order books have gotten much, much fatter. car sales are way up. and ppg's products are way more competitive versus the european counterparts. we haven't seen that in the companies reporting it. ppg's last quarter had all the negatives none of the positives, be in six weeks a monumental
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swing has occurred. ppg can show earnings growth over the end of the year because of what's causing the recent turmoil now. what gets sold, what becomes the lose? the stock of ppg, why? it's one of the s&p 500. nonetheless, it will get too low versus all the positives i have outlined and then you have the buy it. maybe that recognition is becoming to dawn on investors after the interview here. that's why itted a advanced $3.58 today. you should take advantage of it, not be repulsed by. the action in ppg until today and last night's interview is why investing is so hard though. but it's why investing is worthwhile. when this smoke clears as it did today, ppg will be a much more profitable company. its stock will draw money away from others that don't benefit
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from the great 2015 sea change that you and i know about. but will soon be evident for all to see. let's go to rick in maryland. rick? >> caller: hey, jim. i have a couple questions about u.p.s. and fedex. first, which one would you rather have going forward? and if fedex is allowed to acquire t & t will this get them a competitive advantage over u.p.s.? >> i think fedex is doing better than u.p.s. u.p.s.' last quarter was good. i know i had said they better start doing good quarters because they had bad year over year holiday seasons. it was a good quarter so it's cheaper than fedex. fedex is actually saying positive things. i kind of like them both here. honestly i do. sure investing isn't easy but it can be worth it and a case in point is the company i talked to last night ppg.
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the smoke will clear. the company will be much more profitable and the stock will impress you. but will it be much higher? much more "mad money" including the stock behind pollo tropical and taco cabana, it's losing steam, but could now be the time to chow down on the fiesta restaurant group? i have the ceo. now i know the market is like a see saw, but one group of stocks has found a formula for success. i'll clue you in on the winners. plus, a thunderous thursday edition of lightning round is just ahead. stick with cramer! christina she would een and
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what do you when a red hot growth stock momentarily loses the mojo? the underlying company's growth looks like it may plateauing and then the shares get pounded. that's a question fiesta restaurant group, that's the once hot now not so hot company of pollo tropical and taco cabana. the former being a caribbean chain and the latterer issing -- latter serving mexican food. it went up to $69 in the peak
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but now it's down 26% to $50. mostly because in february they delivered a quarter that some people thought was less than perfect. when you dealering with a high flying stock that's an exultive valuation anything less than perfect can be dangerous. maybe growth is slowing. and fiesta delivered a one cent earnings beat off the 38 cents basis. some said it was weaker than expected revenue. up 12.7% year over year as well as the increase in same-store sales in pollo tropical and once again, no guidance, so people didn't like it. stock had plunged 15% in the week before though and the results were better than many people feared. now, i don't know, we have to take a longer term view here. fiesta is very much about new store growth, particularly at pollo tropical. it has plans to open new ones and 20% store growth so the story of growth remains intact. question is has it come down
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enough to buy? let's check in with tim taft. the president and ceo of fiesta restaurant group to find out more about the company and where it's headed. welcome back to "mad money." >> thank you, jim. >> okay, we have to solve this problem. to me there was no slow down. i think the expectations got so high that it really didn't matter what number you picked. do you think i'm right? >> i think you're right. i think that, you know, one of the things that we have heard is that pollo tropical and your transactions have slowed down a little bit and that was a cause for panic. but with edon't agree with -- we don't agree with that. if you're a watcher of the stock, you saw it happen in 2013 for similar reasons. >> let's go over it, because in the conference call you mentioned that you felt that some of the stores had -- you said a little bit of pinch because of the affordable care act. i would think your combination of stores is so strong you would not feel that level of pain. >> well jim i think there's two i think thises going on.
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first of all, the three counties we're talking about in dade broward and palm beach, those are the three highest volume restaurants in our system. and those three counties had 750,000 people sign up. so when you take -- if that was the state, it would have been third in the union. you have a lot of people signing up and a lot of people in the busiest areas trying to figure out how are we going to pay for it. we believe it was a momentary issue and that things will rebound. >> now, how much of -- i have propounded this thesis and it did seem to play out when i looked at the stocks. how much do you think that all the restaurant groups sold down because gasoline bottomed? >> i think that's a big part of it. i think if you listen to all of the earnings releases and look at all the results that the restaurant industry by and large has been affected negatively. >> now, let's talk about the third concept. because i know it's brought up several times in the conference
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call. i think it's important because you're a great operator, but you put up only two of them. cabana grill, if it's really good isn't it time to start putting up a lot of stores? >> i think it depends on what you want to achieve by it, jim. the first one that we enoed up we learned a lo-- we learned a lot. i know that you have covered the the -- what's going won taco cabana, but one of the greatest things that's coming out of cabana grill we're learning how to build a less expensive taco cabana. lowering the costs of entry into the market place and at the same time, really getting innovative with our food. so all of that learning that we have with cabana grill is going into taco cabana. i think that the opportunity for cabana grill is on tap but it's a test. pollo tropical had four or five or six iterations of itself. this is first out of the box. >> you cautioned us on, don't add stores for the sake of
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adding stores. buffalo wild wings talked about chicken prices and how much it hurt them. you do a lot of chicken. chicken under control for you? >> chicken is under contract for the remainder of the year. i think there's still an opportunity if chicken goes down that we still have the opportunity to move some volume to another supplier. but we're locked in to the pricing for the rest of the year. >> so i don't have to worry about bird flu or anything like that. that will be solved by the end of the year hopefully. >> i think one of the things that people have to understand the amount of birds affected relatively speaking as a percentage is a small amount of birds. second, that that industry does a very, very good job of making sure that whatever happened that they can police that issue out of it. >> okay. last week we were in san francisco. we saw a lot of technology. one of the things that we saw that was kind of basic but is working is the postmates. i mean do you -- you seem -- you have stores in areas that i would work perfectly with
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postmates. is that something worth considering? >> it is. i think the laundry list of things that we have right now is really we have got 10 or 15 things that might be in the queue before we head in that direction. >> i get a lot of questions @jimcramer on twitter, something is wrong, something is wrong. you're a restaurateur, you have been around. you totally understand it. this is just another kind of just a couple of month interlude in a longer term scheme right? i'm urging people to stay patient. >> jim, a very wise board member said to me recently, with respect to the p.e. ratio that the shareholders dictate what the "p" and the management team all they can do is earn the "e." so what we're doing right know, there is not a single initiative over the last four years that we have not accomplished on time or ahead of time. and the results thus far are better than anybody really thought that we could achieve.
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this management team has the head down, it's grinding. there's no panic here. this is -- our plan is being executed and we're at that phase in our existence or evolution that what we're doing right now is just making -- stacking them on top of each other. one quarter better than the one before. >> i think there's a kind of sense of on or off. you're the old fiesta group or mcdonald's. it's harder to fix, isn't it? >> well i think first of all, some people often overlook that we have two brands and one we're very, very proud of what's going on with taco cabana which right now is the larger of the two. and people kind of lose track about how well taco cabana is doing. pollo tropical one thing to keep in mind, we were high fiving
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ourselves that we were achieving sales and volumes never seen. we're exceeding those now. so it's not necessarily a reason to be doom and gloom about this. >> well, i'm glad that you put that there. i feel the same way. periodically you get the rotations. we can talk to any number of restaurants and they'd say the exact same thing. i think you're on a very great -- define long term growth which is what you need. tim taft president and ceo of fiesta restaurant group. thank you for coming on the show. guys there's nothing wrong. fiesta restaurant is fine. tank its time, but it will get back and then more so. "mad money" is back after the break.
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so you can reach millions of qualified candidates. then we'll give you the tools to help you manage, screen and rank your applicants all so you can find the right one. try zip recruiter for free today. >> announcer: lightning round is sponsored by td ameritrade. >> it is time. it is time for the lightning round. you say the name of the stock. i don't know the calls or the name of the stock ahead of time. i tell you whether to buy or sell. when you hear this sound -- [ buzzer ] -- then the lightning round is over. are you ready, skee-daddy? time for the lightning round. start with tommy in oklahoma. >> caller: hi, jim. any comments on one oak after the earnings report came out? >> i'm not a big fan of oneok.
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if you want to be in this group be in either transfer partners enterprise or you want to be in kinder morgan the c-class kind. c corps. not in oneok. it doesn't have the growth i used to like. let's go to cory in massachusetts. >> caller: jim, big booyah froms. we're making history. i'm calling you on the apple watch. >> hold it. tim, tim, come in. >> caller: what do you think of horizon pharma -- >> i like it. we know that they have a great business model. i think you can go up over time. this guy is building a lot of great wealth. i think he's a winner. rodney in florida. rodney? >> caller: hey, jim, thanks for taking my call. >> of course. >> caller: what are your thoughts on -- >> no i don't want propane or fracking sand i don't want those. if you take a look, they had a move. this is when you should sell sell sell. because i think that in the end,
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you don't want to be in the let's say the service business other than if you're a big dog. let's go to larry in florida, larry? >> caller: hi, i appreciate you taking my call. there's a lifestyle community developer in florida that came out with a secondary a couple of weeks ago it has a p.e. of 12. called wci community. >> i can't believe that company has made such a come back. it's really doing very, very well. i happen -- anyone mentions home building i go lennar. because i like best of breed. john in virginia, john? >> caller: jim, booyah. >> wow. >> caller: i need some help with the transocean. can you help me on that? >> transocean is involved in deep water rigs the deep water market has not come back at all. so therefore, my help is to say that if it does go up at all sell sell sell. and that, ladies and gentlemen, is the conclusion of the lightning round. [ buzzer ] >> announcer: the lightning round is sponsored by td ameritrade. sup jj? working hard? working 24/7
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♪ in this increasingly volatile roller coaster of market, it feels like everything that makes sense has been stood on its head some groups are pretty consistent winners. despite the almost schizophrenic action over the last couple of months. take the major chemical stocks. they have been strong outperformers, many with proven fundamentals. we're going off the charts to find out where the best names
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are headed with the help of bob lange, the founder and senior strategist at explosive.net and behind the performing trifecta stocks newsletter. the chemical stocks headlined by dupont and perhaps ppg have the best charts out there. they have been outperforming of late and we see call option and it's clear to lange that big money is flowing in the group. you know when they get annoyed and they're accumulating the chemical stocks you get longer lasting terrific moves. let's go through them to see what he's seeing. he's start with dupont, dd which has been under fire from nelson pelts who wants the company to break itself up. to be fair or at least streamline itself, to be fair to the ceo ellen kohlman we need to look at the long term monthly chart here. when kohlman took over in
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january 1 of 2009, dupont was at multiyear lows. whenever you caught a pull back between 20 say 11 or 12 those were terrific buying opportunities. they're one of the best buying stocks since the generational bottom. in march of 2009 right here the whole market bottomed and then, you know beaten them all. well, not all of them but pretty much. bob lange thinks the uptrend here is very much intact. especially with pelts continuing to apply pressure on management to create value. you can see it better in the daily chart. here we can see that the stock has pulled back since mid march. see that, a big decline. although last we get rebounded, we rebounded hard from the support. lange thinks it's important when dupont was getting slammed the stock still held up. in the 200-day moving average. okay? lange also notes that last week's monster rally came after
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some heavy call buying which suggests to him that some big buyers are focused on dupont moving up sharply in a short period of time and if that's because pelts may end up on the board. the mac d, the momentum indicator to detect changes that gave you a classic buy signal right here. the black line crossed over the red one, okay? that's very, very meaningful. and that's one of the reasons why the stock roared. meanwhile, lang also thinks that the relative strength index another momentum indicator seems poised to break to the upside. put it together and lange thinks it's a buy here. i know people think it's had too much of a move but there's nice upside. and next up we had the ceo on this week from dow chemical. we know that they're taking steps to become more like dupont and ppg by spinning off the commodity business. so take a look another this chart. you can see that this stock
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broke out to the upside or high volume in late. this is a pretty definitive move and again in late april it had another surge. lange points out that this stock has been making higher highs and higher lows. that's textbook. textbook example of what a technician wants to see on the healthy chart. the mac d indicator gave us a healthy look and then heavy call volume in dow chemical and people believe the stock is headed higher. lange pointed out that the dow has finished a cup and handle formation. that's where you get the u-shaped formation, that happened in april and then the stock starts roaring which is where it's been for the past couple of days. it's the favorite name to buy and there are some negative publicity about the ceo today and the stock did get hit, but he said it's okay. it's at the right levels. we have another high quality chemical company. that was one that people don't talk about, the best chart i have ever seen. created from the merger with the
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european basil at the end of 2012. this is incredible. when it pulled back nearly 50% in 2011 that was a fantastic end point. why does it matter? because lionel basil has pulled back again although it's been rebounding lately. lange thinks you might want to buy when it's 13 points off the low. he is saying that could be like that. now, why don't we look at daily chart of line dell. not only do they show great relative strength with the mac d, flashing a buy signal but it's about to make what we haven't seen much in 2015. a golden cross. that's where the 50 day short term blue okay moves crosses over the longer term 200 day. and for chart watches it's when of the most textbook bullish signs. this is about to cross. and that's going to be a big
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buy, so you see this stock pop when that happens. now, it may have run up substantially in april. lange said this is not finished. that's what you will see, it's because the cross is completed. finally, ppg with the ceo chuck bunch on last night. i adore ppg both the company and the stock but according to lange this is actually the weakest of the chemical charts. you can see it's got a whole different formation here. however, ppg says it another been tracing out a "w" pattern. okay. and its mac d is making a bullish crossover but this is premature. but if this happens, then lange believes the stock can break out of the current triangle pattern, okay it's a triangle pattern which is not good. that it's been stuck in. he thinks it can rally back to the old highs of 2007. according to bob, the chemical
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stocks are in a terrific position. he likes dow, dupont and lionel basil and throw in ppg because it's looking better. but lionel basil may be the best one of all. stick with cramer. ♪ ♪ ♪ it took tim morehouse years to master the perfect lunge. but only one attempt to master depositing checks at chase atms. technology designed for you.
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can it make a dentist appointment when my teeth are ready? ♪ ♪ can it tell the doctor how long you have to wear this thing? ♪ ♪ can it tell the flight attendant to please not wake me this time? ♪ ♪ the answer is yes, it can. so, the question your customers are really asking is can your business deliver? i like to say there always a bull mark somewhere. i promise to find it for you. seem jim cramer. see you tomorrow.
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>> narrator: in this episode of "american greed"... marc dreier... high-powered lawyer... >> "you can smell the money, and that's why the clients come here." >> narrator: ...bon vivant... >> when marc stepped into a party, marc was there to party. >> narrator: ...con man. >> you have a guy who's actually pretending to be other people. >> narrator: he steals more than $700 million from hedge funds... >> they were vast pots of money with billions and millions, you know, overflowing the sides. >> narrator: ...because that's where the money is. >> this was a man who had always felt deeply empowered, that this type of success was his birthright because he was so smart.
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