Skip to main content

tv   Mad Money  CNBC  July 10, 2017 6:00pm-7:00pm EDT

6:00 pm
right? >> until the bitter end. >> for all the reasons people like it -- >> american express will get you done there, scott. good to see you. hope to see you back tomorrow. >> i'll see you tomorrow. >> i'm scott wapner. catch "fast money" 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 make you some money. my job is not just to entertain but to educate and teach you so call me at 1-800-743-cnbc or tweet me @jimcramer. so many people, so many people simply do not believe in this market
6:01 pm
they think this is unsustainable and we're in a dangerous position >> sell sell sell. >> the house of pain >> the dow dipped six points the nasdaq advanced 0.38%. i want to address this reluctance to believe in the bull head on by going over the top ten reasons why investors always seem to have one foot out the door, despite the fact that we've had one heck of a run, from the lows way back in march of 2009. so let's go right to it. the first one, we've been hearing it for years the bull has run for too long. it's now on its last legs. put aside the fact that bull markets don't die from old age, but die from recessions, rate hikes or new ipos. we've had three serious
6:02 pm
corrections. one in 2011, when the s&p 500 downgraded the credit rating of the united states. and in 2015, fears of a chinese collapse and one in february of 2016, related to the collapse of oil so this stocks entered bear market mode that it's almost like we've had three bull mar t markets. that's why i can't buy into this senile bull feces. plenty of things could kill this market, but time suspect one of them second, many contend we're back in the year 2000, right? that scenario of the nasdaq collapse that we're going to get crushed when the earnings come through. this is not the dotcom era in 2000, we had a numberof secondary offerings as the smart money headed for the hills ahead of the collapse. can you recall any secondaries i can't. we also had negative
6:03 pm
preannouncements near the top. other than o'reilly automotive, we haven't had any of these nasty things lately. and we saw a big jump in bankruptcies in 2000 again, something that's not happening now. in other words, we didn't just have an earnings shortfall at the end of the dot com era plus, the price range to multiples of many of the tech stocks right now are about 1/10th of what they were back then 0.1 the third objection, lots of people still believe, the majority believe that the markets only rallied this far because the fed put us here and it's going to crush us when it tightens in earnest. but the truth is, as i've said over and over, we're in a rare moment where we benefit from higher rates if you care about the banks lending money, they need to make more of a profit, which is what
6:04 pm
rate hikes give them that's why the financials have reasserted themselves as leaders. no bear market has ever begun with the financials as the leaders. many started with the banks as slaggards, though. trump hasn't delivered on tax reform and there's gridlock in washington but let's remember, gridlock has never stopped us from rallying in the past. we just had six years of divided government and the bull kept running. maybe we'll get some tax reform next year, but still, it should have been obvious that the president's agenda would be put on hold when congress decided to make health care the most divisive issue in america its top priority however, at the end of the day, a government that does nothing under a republican president is still more market friendly than one that does nothing under a democrat i'm not trying to be political here it's just that the republicans
6:05 pm
are known as the party of capital, the democrats the party of labor both equally valid, but the stock market is capital. the perception is stocks have gotten expensive you think if stocks were truly expensive, then value stocks would hold their value however, value stocks are the principled source of pain in this market. plus, i've been examining hundreds of stocks that are not on most people's radar screen. they simply can't be considered pricey this isn't just anecdotal. so much of the movement in this market has been broad based. the sixth reason people distrust this bull, there's a tremendous fear of tech knockstocks why? much of the advance is in enterprise tech stocks, not the consumer oriented tech stocks.
6:06 pm
i could go on and on most just simply don't know what to do, so they presume these stocks are expensive there's a whole cohort of tech companies related to storage that are beyond most investors so of course, what they don't know, they react with fear to. if you don't work with the stuff professionally or you don't know the ceos, you don't understand the stories, then you don't know how great this tech revolution is, and you assume it's overvalued you assume it's 2000 when there was tech revolution talk and it never materialized seventh, there are a lot of health care stocks similar to tech that just aren't understood, because they're part of this medicare/medicaid business that's had the run of the joint for ages the truth is, again, not political, but a single payer system, without one, health care
6:07 pm
will always be run inefficiently and the taxpayer will keep getting ripped off single payer is probably the only way to save money long-term and there's no way we're getting a single payer system any time soon, so the health care stocks will continue to run no one is checking how much they make ut eighth objection, there's been a lot of energy companies created. there's been almost no consolidation, and all these stocks are high profile, daily disappointments that carry a lot of psychological weight. they're like a steamer trunk on the back of the market ninth, speaking of the ultimate disappointers, the area in the market we can see best, the one that is so easy to talk about and right in our faces, retail it's a disaster, because of amazon i say there have been some
6:08 pm
retail bankruptcies, but know major ones the fear of amazon has become so all encompassing, though i say stay tuned i'm more interested in buying than selling more on this later in the show the final objection, and this is another segment, a lot of these are psychological, i know. this is deep psychology. since advent of youtube, expert and so-called experts feel the need to be muted whenever they wax bullish. nobody wants to say something really positive, because if the market gets crushed, your words will be preplayed endlessly and used against you and you know what? you look like a moron. most people take the more e quich la -- equivalent of the fifth
6:09 pm
amendment when they come on tv these days there's a lot more accountability for the bulls than the bears so the bulls always sound tepid compared to the pessimist, big-time hedge fund managers that means the bears always control the dialogue even if they've been wrong for the last 15,000 points look at fang run the bottom line, i don't think any of these objections will change any time soon they're just going to be with us so we need to acknowledge these ten reasons why the bull is so widely mistrusted. that way you don't have to have one foot out the stock door every single session let's go to joseph in alabama. joseph >> caller: hey, mr. cramer, thanks for taking my call. >> of course >> caller: so i bought into target at $57 a share.
6:10 pm
it's trading down lately and i want your opinion about a long-term investment >> i think target is in the cross hairs of amazon and walmart. that's an uncomfortable place to be the fact is, it's in crisis right now. it doesn't know how to make it, because it's so different that we all go there. do i think it represents long-term value? if it changes and finds a way to get it so i'm in the store, yes. but it's got to do that. okay, dan in virginia. dan? >> caller: hey, jim, how are you? >> i am good, dan, how about you? >> caller: doing great just wanted to say appreciate all you do, all you teach us i'm a schoolteacher and i continue to learn from you each day. >> thank you very much that's what i've been telling some people this weekend if i can make the show 100%
6:11 pm
educational, that's where i'm going. >> caller: you can come to my school and visit i'm calling about pandora. about a month ago, siri announced a substantial investment in the company. since then, the stock price declined 12%, but since then has rallied 20% from that low. they announced a big change in senior management and speculation about a potential merger or partnership with companies such as tesla or amazon the question i have is, being the first player in gold standard of streaming music, wouldn't pandora make an outstanding mid or long-term investment >> that whole deal they made was to give them more capital to give more of a runway. but i think there's a lot of hot money in the stock so your fellow shareholders are your enemy, not your friend. so i would say that it's fairly valued at that price i have no real interest in being it but thank you for those kind
6:12 pm
comments sure, there are justified gaps against the bull, no one is denying there. but there's no reason to jump ship you should be able to spot opportunity. when it comes to young and young china, see which offers a bigger piece of the pie and with amazon prime day, are brig and mortar retailers preparing for the worst? but first, warren buffett just made a $9 billion for encore will he get it i've got the exclusive, coming up next. so stick with cramer >> don't miss a second of "mad money. follow @jimcramer at twitter tweet cramer at #madtweets send an e-mail at
6:13 pm
llt 80 a@cnbc.com or give us ca a1-0-743-cnbc miss something head to madmoney.cnbc.com. ♪ [vo] progress is seizing the moment. your summer moment awaits you now that the summer of audi sales event is here. audi will cover your first month's lease payment on select models during the summer of audi sales event.
6:14 pm
6:15 pm
or a little internet machine? [ phone ringing ] hi mom. it makes you wonder... shouldn't we get our phones and internet from the same company? that's why xfinity mobile comes with your internet. you get up to 5 lines of talk and text at no extra cost. [ laughing ] so all you pay for is data. see how much you can save. choose by the gig or unlimited. call or go to xfinitymobile.com introducing xfinity mobile. a new kind of network designed to save you money.
6:16 pm
tree months ago i told you how they were trying to buy encore electric, the largest utility in texas whi since then the deal was bought by the texas public utility commission, but encore is too attractive of a target to pass up last friday, warren buffett offered $9 billion in cash for encore now we're hearing that elliott management, encore's largest unsecured creditor, might been to pay $300 million more than buffet for this business still, we've reached the third attempted acquisition of encore in two years let's check in with the ceo of
6:17 pm
encore electric delivery and find out more why he thinks berkshire hathaway is the right home for it. good to see you. bob, i've got to tell you, people at home are going to be confused, because when they hear ba bankrupt, they think worthless >> you've got to start with the lbo in 2007. 2007 this company was taken private in a $45 billion lbo the state of texas wisely said we're not going to subject oncore to that rest, so it's become the debate in this process. by the way, that turned out to be quite insightful because what's happened is you talked about her chant generators a lot is what happened to natural gas prices essentially they were making a leverage buy from natural gas, natural gas does from $10 to $2. >> your business is for you
6:18 pm
viewers, we have con ed on regularly, it's that pure business that can be a great business >> it's really robust growth and with deregulation, we've transformed the generation theme in texas the most renewables in the country, transformed by gas fleets, and the investment to enable that largely companies like ours, building out the transition grid, building out the technology, so we've invested billions of dollars, to help drive bills down. electric bills in texas today are 25% lower than 15 years ago. >> that's amazing. everybody else is going up >> the way the market has worked in texas, we'll have continued investment opportunities to help enable all of that, in addition
6:19 pm
to the growth. so in the eyes of berkshire hathaway, strong business, strong cash flows, real good reinvestment opportunity makes up a great fit >> here you've got elliott, a very smart group of people they own a lot of the debt why shouldn't there have been--d at $9.3 billion be superior to warren buffett >> they've been very supportive of our investment strategy what they did, they were given conditions -- conditions that they didn't want what berkshire did, they went to austin, said we think you've got it right we'll accept it and expand it and they worked out a deal with the staff, the industrial coalition, the municipal coalition, and they cut a deal
6:20 pm
so they said we'll take this, because they're not afraid of an independent board. >> but so will elliott >> we know elliott will. they're our largest creditor at this point, it's just a conceptual they're fine people. but all i know is what is in front of us is buffet. so the berkshire hathaway deal would be great for this company. i just don't know enough about elliott. >> this could be a needle mover. i know berkshire hathaway is only 10% of this business. but oncore, what are your growth prospects? you've got superior growth profile. >> we do we're going to invest $1.5 billion in cap x at a minute the beauty is, we're not doing that to drive customer yield up, but down
6:21 pm
so we have a good growth profile that drives costs down >> you mentioned the administration, that deregulation could help you. what does that mean? i tell people that maybe that's the most important thing that's happening under president trump, is he favors deregulation. that's a different environment entirely from the previous president. >> it is the deregulation we put in place years ago in texas we have deregulated theal if --. >> that's good for the rate payer. you're telling me the customer does better in texas because of this >> they have absolutely done better >> it seems like the public utility commission -- if elliott's bid comes in and wants to help the senior creditors and the junior creditors, unless they commit, which i think they will, making it so the customer doesn't get hurt, it's not going to get approved. >> absolutely.
6:22 pm
you have to come in and do what berkshire did. so we'll accept the conditions you have to go to texas first, then the debtor, then the bankruptcy court this bank rupt si has been so long and expensive >> elliott was negotiating and berkshire is came in out of nowhere and elliott was caught unaware. you're in the cat bird's seat, but is there a way to resolve it so everybody wins? >> i think there is. elliott is happy to work with berkshire hathaway they want to make sure they get the best value they can from berkshire hathaway >> you also have a bankruptcy court that wouldn't want to hurt senior or junior creditors >> that's right. we can work this out >> one last question, why couldn't we buy a share of oncore it would have been my favorite public utility it would have been the best.
6:23 pm
>> it's a great story. the complexity of this debt structure in bankruptcy, too hard >> that's the ceo of oncore electric, and if berkshire hathaway -- i love berkshire hathaway's stock anywhere. stick with cramer.
6:24 pm
6:25 pm
but is the appetite for fast
6:26 pm
food in china big enough it's local versus global in a battle between pies, thighs, and tacos. which yum can fatten your wallet >> last november, yum brands, the parent of pizza hut, taco belland kfc, broke itself into two separate companies young china, which got their fast growing chinese business, and the remaining yum brands now that it's been put to bed for eight months, you know what? i think it's time to give both stocks another look and figure out which is the right one to own, which is better, yum or yum china? you need to understand the gene genesis. china's company had slowed considerably in 2014 and 2015, and the company's once fabulous numbers had gotten hammered.
6:27 pm
yum was doing just type everywhere else, but china had gone from being the jewel in the company's crown to something that scared investors away, but still held up tremendous promise of growth, as it had been the driver the way to play china for years, frankly. after a long period of frustration among investors, yum decided to break itself up into a high risk but also high reward play on china. and a steady, consistent play on the rest of the world. look, so far this is great if you owned the old yum through the breakup, you're now up 27% but that begs the question, which should you own, the original or the chinese? before the breakup, management gave us long-term targets for both businesses. for yum china they forecasted long-term earnings of 15%, powered by mid single digits
6:28 pm
same-stores sales growth and the chance for the company to triple its store count, because the chinese market represents such a gigantic, really kind of i would say opportunity even after all these years. so they forecasted 13% earnings per share, bolstered by a 2% dividend as the company moves to franchise the vast majority of the stores, creating more of a steady business model. so you have the reliable versus the superior growth, if it happens. so how have yum and yum china done since the separation? let's start with yum china by the time the split up came, yum chinese same store sales had already begun to stabilize but then the numbers seemed to stall again, before improving yet again. however, when yum china reported last week, the stock got hammered because the company delivered a minor
6:29 pm
disappointment it lost 13% of its value in a single session it initially looked like yum china was doing really well. in the first quarter, the company posted sales kfc was in good chain, and even the ailing chinese pizza hut business was doing okay. but then we got yum china's second quarter results last week, the one that caused the stock to get obliterateoblitera. the problem was two things pizza hut's turn around hit a snag two, there was some confusion surrounding yum china's restaurant margin guidance
6:30 pm
i think the number for 2017 would be better than 17%, but this is what hammered the stock. y you can understand how it would get hurt so badly, it was basically okay but not a perfect quarter. many realized that they had overreacted to the stock and it rebounded 7% the next day. but you know what? not enough so things are not perfect with yum china. but they're not as bad as you might expect xwimpb tgiven the decline last week. but how about yum everywhere else there's some really positive changes. taco bell has been very strong sales up 8% in the first quarter. kfc, solid, 2% pizza hit down 3%. lately, yum's management has
6:31 pm
been talking about doing something big to turn things around yum is going to invest $130 million to upgrade their equipment and improve operations kfc and taco bell are in terrific chase, here in the u.s. and everywhere else that yum does business, except for china because that's a different company. so which is a better stock for you, yum brands or yum china let's start with the stocks them the selves ev when you look at other quick serve restaurant names that are growing, both numbers seem reasonable domino's sells for 33 times earnings even mcdonald's is trading just about 11 but let's see. let's put it together.
6:32 pm
i think it's crazy to yum and yum china are trading at the same price earnings to multiple. now with taco bell so strong, i think yum brands is the true growth vehicle here. and yum china had some real problems with growth that needed to be worked out before it deserves to trade at the same a the parent company it simply is superior to the chinese spinoff. until that changes, i'm sticking with the original yum worth owning i've been recommending yum brands since long before the breakup, and you have a nice gain here. stick wit, because it's outperforming yum china becaus taco bell is on a roll, and yum china turned out to have less growth than the parent, at least for now. let's go to jimmy in california. jimmy? >> caller: hi, jim, i love the
6:33 pm
show you're awesome, your staff is great. >> i have a great staff. they make me look good every day. what's up? >> caller: my stock reports in two weeks after blowing away the numbers last quarter it's pulled back 20% since its 52-week high in may. should i buy more chipolte >> yes, i think you should they're spending more than i would want, but they're doing that to rebuild the franchise. december 7, 2015 is when they had the last incident. we're starting to figure out where we are december 7, 2015 was the neuro virus at boston college. now we analyze, and you're at 18 months that's been historically where you want to get long, right here, right now.
6:34 pm
i would buy some under $400 if it gets there. sally in florida, sally. >> caller: hey, jim. >> what's up >> caller: i have a question today for you about mcdonald's >> sure. >> caller: okay. so given the declining revenues every year over the last four years, and taking a really hard look at the balance sheet, declining assets, the looming debt, i think it's over $27 billion now, negative equity, $2 billion in negative equity i see trouble. what am i mising >> you have a real turn in the same-store sales which control things all what you say is right, absolutely and you say it's crazy is the stock has moved so much, but it's reinvigorated company with
6:35 pm
a reinvigorated stock and people are willing to pay this amount i think it's overdone to the upside and i've loved it for a long time. i want it to pull back, but it's a very real movement thank you. yum brands breakup is one of the most anticipated in recent memory i say you stick with yum brand the parent much more "mad money" ahead, including a little known biotech company with a new way to treat cancer, and it's up over 100% year to date i'll talk with the chairman, next then hearing the fallout from amazon prime day, i'll tell you what to watch for come the brick and mortar, let's just say implosi implosion. and toovenlt's edition of the lightning round. so stick with cramer
6:36 pm
your brain is an amazing thing. but as you get older, it naturally begins to change, causing a lack of sharpness, or even trouble with recall. thankfully, the breakthrough in prevagen helps your brain and actually improves memory. the secret is an ingredient originally discovered... in jellyfish. in clinical trials, prevagen has been shown to improve short-term memory. prevagen. the name to remember.
6:37 pm
6:38 pm
let's talk about a small cap stock that's been on fire lately the stock of nvcr, an anti-cancer play we have championed that's rallied 130% year to date that's right, 130% for those of you that don't remember, they've pioneered a
6:39 pm
new way to fight cancer with tumor treating fields. they use low intensity electric fields that disrupt moll cues within cancer cells. compared to surgery or radiation, this is a gentle and nobody invasive method to go after solid tumors, with far fewer side effects this is not some experimental technology the platform has been approved to treat gbm, a nasty form of brain cancer it's on the market, selling very well this could be just the tip of the iceberg, as they study this technology as a treatment for all sorts of solid tumors for lung cancer to breast cancer, cervical cancer, and pancreatic cancer you name it. so could this stock have even more room to run let's take a closer look with the chairman of the board. welcome back to "mad money." good to see you, sir >> good to see you
6:40 pm
>> have a seat, bill the sales have been remarkable in the time since we have seen you last i want people to understand, this is a totally new but actually much less dangerous therapy than when used in conjunction with other drugs and produced phenomenal results. >> when we think of cancer therapies, we think of surgery, radiation and drug therapies these are the big three. this therapy was invested by a professor in israel whose expertise was the electrical properties he was able to use these low intensity electric fields to disrupt cancer cells as they divide there's noic toxicity associated >> this has got some very good momentum and are governments and insurance companies willing to pay? >> first of all, it's been a
6:41 pm
tremendous i would say 18 months of building for the company since we went public we received the fda approval for gbm right after we went public since then, we've expanded our sales force, the number of centers that are trained to administer the therapy we published our data in one of the top medical journals we received something called the nccn national comprehensive cancer network rating as a standard therapy we introduced a new, smaller device and i think most important i, in april, we presented five-year data there's something magical in oncology about thefive-year data and before the approval of a drug called timidar, there was zero five-year survival for gbm. with this drug, maybe up to 5% with timitar, plus our therapy, we almost triple that. we still have a way to go, and
6:42 pm
we're doing a lot of work in that area, but what's happened as well is, and this is the answer to your second question, we've seen nine quarters of sequential growth with patients on therapy and the way we charge it's a therapy, so payer's pay per month of therapy, as the number of patients on therapy go up, so does the revenue >> so 20,000, what's the current per month? >> so the list price, and it's global price, u.s., europe, and japan, is $21,000 per month. the second question you asked is about payers this is a classic disease that's appropriate for insurance. what i mean by that, it's a crisis, catastrophe that happens to a small group of people in the u.s. today, approximately 200 million, essentially all privately insured patients have access to the therapy.
6:43 pm
we still don't have coverage from medicare. that typically takes a little longer >> right >> as a company, we've made the decision to provide it to all medicare patients while we pawat for the government so everybody in the u.s. has access >> this is not the kind of end of life, where some people, many people come on and say that's the most expensive thing this is very much -- you can have a vibrant life with this. these are people who can walk and talk and go out and do things that would otherwise be a death sentence >> absolutely. the median age for gbm diagnosis is in the 50s. so this is not a jer yak rick cancer the quality of life on our therapy is much better for patients than for patients who don't have the therapy >> i lost my mom to cancer, and
6:44 pm
there was no quality of life so it's just ridiculous to continue like this what you're doing is creating a quality of life with a device that used to be the size of a car battery and now? >> 2.7 pounds. and they carey it with them. >> and the way you go through and create with other drugs, a much greater way of let's say arresting the cancer >> no, they actually beat, in patients who respond, the tumors shrink over time and they'll have extremely good prognosis for a long-term solution >> i want everyone to know about this i said this from the day i met you. that's really important. >> and one thing i'll emphasize, they are bringing it to the other soild tumor type so we have phase three trials under way in lung cancer and by the end of the year we'll have a phase three trial under way for
6:45 pm
pancreatic cancer and we just received a humanitarian device designation for mesothelioma >> you've done a great job that's bill doyle, chairman of novacure "mad money" is back after this
6:46 pm
6:47 pm
6:48 pm
it is time it's time for the lightning round. [ indiscernible >> buy buy buy, sell sell sell sell sell. >> and then the lightning round is over. time for the lightning round tom in california. tom. >> caller: hey, jim, this is tom, long-time listener. i've been listening to you since i retired in 2010. >> thank you >> caller: so a lot of my stocks are cramer picks thankfully but any way, back on the end of december, i thought you suggested mattel as a buy, mat >> has bro hasbro, the ceo has been on the show many times.
6:49 pm
and i still like hasbro, even up here more than mattel. mattel could have been a spec. but hasbro is the real deal. lee in maryland, lee >> caller: cramer, yo. i want to buy some raid odeon >> no, it's got a multiyear run on it. i think you're okay. how about michael in new york. >> caller: hey, jim, huge fan of yours. >> thank you >> caller: i recently invested in a small cap surgery company mazor. >> they had a good quarter they shipped a lot of product. my understanding is, that last quarter made it. i would love to say, buy buy buy, but i would like to know what happened with the israeli s.e.c. alex in pennsylvania, alex
6:50 pm
>> caller: hey, jim, yourfathe was truly blessed. >> my father's birthday was on sunday, yesterday. thank you. >> caller: very nice, yes. what are your boughts about goose right now? >> i still like it at 19 i think it's a good story and i know that retail is challenged but this is a story domestic going international. i like it. josh in texas, josh. >> caller: greetings from texas, jim. >> how are you doing >> caller: doing well today. a lot better than the stock, i know you mentioned how -- possibly a good chance to jump in [ inaudible >> i'm going to get the ceo back on i thought it was going fine. i know there's another drug doing well but the shorts have been all over this. we need the ceo to come on and talk about how the trials are going. and that, ladies and gentlemen, is the conclusion of the lightning round!
6:51 pm
>> the lightning round is sponsored by - amazing trading knowledge. that's a great idea, but why don't you just go to thinkorswim's chat rooms where you can share strategies, ideas, even actual trades with market professionals and thousands of other traders? i know. your brain told my brain before you told my face. mmm, blueberry? tap into the knowledge of other traders on thinkorswim. only at td ameritrade.
6:52 pm
6:53 pm
tonight, at 9:00 p.m., stop everything go to amazon and buy everything they have for sale, because it's going to be amazing. it will be so great, they don't even need to pay me for this endorsement. >> that was easy >> there, i did it, what amazon
6:54 pm
wanted me to do, i promoted their made up event, amazon prime day, that will drive sales. the consensus is it will produce gains up to 20% year over year, new benchmark, making it a day that will live forever in brick and mortar retail infamy today, we heard reports that amazon is coming after best buy with a geek squad of its own that's why the rare retailer that people thought couldn't beat amazon, because the stuff you buy there requires help. but amazon is putting together a unit we learned that is said to do what best buy does. and pop, there goes the stock of what we thought to be a winner now it's a loser down 6% how bad is the fear of amazon? get this, we got a downgrade today of costco's stock.
6:55 pm
it was titled, if 6%comps are not enough, what is? downgrading to market perform. i totally understand the downgrade. last week costco posted the great numbers and it went down because nobody cared costco was well loved until amazon's game changing bid for whole foods. costco's stock lost 2% again since the deal, we heard that amazon might buy any brick and mortar company that can help them dominate. amazon knocks down a stock with its own power and gobbles up the stock underneath when it suits them however, as i always counsel, never buy a stock on a takeover basis, until we see a turn in macy's numbers, i wouldn't count on them buying it. macy's stock dropped to a new low of 21%, part of this flight out of retail. let's step back for a second and ponder the big question.
6:56 pm
are we now giving amazon too much credit for destroying everything it's true that the more prime customers amazon has the worse off the brick and mortar competitors will be. we stock up on soft goods that we might otherwise buy at the supermarket or costco. the threat is real at what point are the worries overdone at what point do the stocks take this pain into account and there is the problem many of the retail stocks being hit turn out to be might any expensive, even after the decline. and still don't represent value yet. so let's take the stock at costco, which has been hammered since the amazon whole food tie-up, going from 180 to 151. even after the decline, costco's stock still sells at over 23 times earnings and many bulls that remain chaer leadin cheer r the company.
6:57 pm
macy's makes a lot of money, does have options. but it has $15 billion in debt, and that scares the heck out of people macy's filed for bankruptcy in 1991 after levering up that still leaves a nasty taste with bond holders. so let the retail stocks come down, let amazon blow up the numbers for prime day and cut estimates from all the others. but remember, not all retailers are created equal. some are better than others. and not all can beat amazon as easily as you think, while the stocks of others reflect the brutal amazoning that may never occur. stay with cramer because we don't like surprises. yeah. like changing up the celebrity at the end to someone more handsome. and talented. really. and british. switch from cable to directv.
6:58 pm
get 4 rooms with hd, dvr, and every box included for $25 a month. your insurance on time. tap one little bumper, and up go your rates. what good is having insurance if you get punished for using it? news flash: nobody's perfect. for drivers with accident forgiveness, liberty mutual won't raise your rates due to your first accident. switch and you could save $782 on home and auto insurance. call for a free quote today. liberty stands with you™ liberty mutual insurance.
6:59 pm
>> >> you wouldn't want to be trading places here. it began when eddie murphy's wife cost friends $343 million i like to say there's always a bull market somewhere, and i promise to find it for you right here on "mad money." i'm jim cramer, and i will see you monday
7:00 pm
>> welcome to the shark tank, where entrepreneurs seeking an investment will face these sharks. if they hear a great idea, they'll invest their own money or fight each other for a deal. this is "shark tank." ♪ first into the tank are erika welsh and keeley tillotson, college students with a business they created in their dorm room. hi, i'm keeley. and i'm erika. we founded our company, wild squirrel nut butter, this january as sophomores at the university of oregon. wild squirrel is seeking a $50,000 investment in exchange for 10% equity in our company.

98 Views

info Stream Only

Uploaded by TV Archive on