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tv   Mad Money  CNBC  April 5, 2018 6:00pm-7:00pm EDT

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>> like the airline. >> you need debate, healthy debate >> respectful debate >> las vegas sands good macau numbers. >> i thought you were going to say spirit airlines. >> i'm melissa lee thanks for watching. see you moowtorr at 5:00 for more 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, not just to entertain you but to teach you. so call me at 1-800-743-cnbc or tweet me@jimcramer how do you approach this bout.
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nasdaq increasing. is this a tradeable low? is this a more placid opportunity to do some buying? buy, buy, buy, buy, buy, buy, buy! frankly, i'm not quite that sure we can't keep rallying the ratio to down buying to upbuying was 9-1 my "squawk box" co-anchor always counseled me that 9-1 up was a signal that a selloff was overdone it was a great lesson for me, and it sure worked like a charm with the bounce on monday. we flew up again tuesday, but the true test came yesterday with remarkable turn after the chinese tariffs were announced we tested the february lows and
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we held, and now we are off to the races! >> all aboard! >> but here's what worries me. what if all we do is hold, then bounce then sell-off again before another week of tested lows, then bounce. just because we made it out of the woods of monday, and then the bounce yesterday, doesn't mean it's going to be smooth sailing. whenever we're down big, i like to stress what can go right. because unless the economy is literally falling apart, there's almost always a better time to sell than right into the teeth of panic you don't sell when everyone else is selling, and by the same token, you should not be buying when everyone else is buying, especially not in this market. i now think you need a little more cautious, and let me tell you why. first, we have an employment
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number tomorrow that could really help us or really hurt us but given that the averages now run, i wouldn't be surprised if we rally and then give up our gains. i could see the markets rally on a big number it's burned in my head, it got annihilated. the nation's largest home loaner said that the participation is the one to rate. if more people are joining the workplace, that means more homes being bought, even if mortgage rates go up. i like that. plus, in february, we had no idea that there were so many people betting that the market would remain placid. they had all those instruments tied to the vix. we're now aware of the risk, although those positions haven't been totally avowed yet.
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jerome powell, the new chair and we could, we will get to that later in the show it could be filled with peril. so i'm focussed on it. if we were down but ahead i wouldn't be so concerned a tad cautious than we were going into the start of the week now maybe trump was never really taking his cue from the market, it just seemed that way when he was pushing a totally pro-business agenda and stocks kept going higher. maybe these days he'd rather judge his job performance by hooking at the one pollster that has the approval rate above 51%, rasmussen. know him well. he's taking this in a very different direction in 2018. he's now fulfilling his original campaign promises to protect workers from the rust belt from unfair competition the thing is, he can't fulfill
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those promises without hurting the stock market, which like it or not thrives on free trade, which brings me to number three. china. when the chinese decide to hit us bakhtick by targeting aerosp, we were told how trump is a free trader at heart. haven't we seen this movie before we had tough talk on trade then the treasury secretary said talks with china were going smoothly, turns out the opposite was true look, anything can happen. but, it sure is a risk factor. that's what i'm identifying tonight. hey, by the way, notice how hash hard the stock of apple rallied?
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i think because its name wasn't on the tariff list how long can these last? if the president keeps pressing his bet. the chinese do not want to cut off their noses to save their face speaking of factors, here's another one. we have a whole new one not focussed on enough etf relationships, a whole new fang wildcard. one of the things that is predictable about our mercurial president is he doesn't give up on anything until he gets a win, even if it's only symbolic right now he wants to rip up amazon's contract with the post office, by the way, it expires in the fall. as he views this as against mom and pop retailers. his fight with bezos could be a real problem
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i worry he will stop at nothing to humble its owner. it's kind of his style his arguments against amazon are pretty specious. maybe they underpriced it, but a contract is a contract and provides a lot of income it's used to subsidize definitely profitable. houg however, you don't have to be a unl h huge cynic to believe this is all about punishing bezos. amazon is a huge company, and when its stock gets slammed, all of the fang etfs there are ten of them! they all go down they go down when he slams amazon finally, we save my worst fear for last and you better be focussed on this has it occurred to you that the president really has it in for mexico of that there's no doubt he wanted them to pay for the
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wall he's mobilized soldiers to protect the border he doesn't have the power to nullify the nafta without the approval of congress as much as i would like to sound the all-clear, there are too many pit falls, what about fang risk and chinese retaliation what about nafta you scrap that, i think you could kill the bull. bottom line, don't be so quick to call this rebound a tradeable bottom if things go the wrong way, it could become an untradeable, non-bottom pretty quick. that's why i'm counseling caution, despite there are pretty good rebounds since the market peaked back in january. elaine in florida. elaine >> caller: hi, jim, thanks for
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taking my call >> of course >> caller: i'm interested in midi max, particularly the short pieces and the allegations of fraud and the way the stock moves. when the market went down really hard it didn't, but on normal days it's under a lot of pressure from short sellers. >> you know, we have been like this there's an aerospace company that was in the grips of short sell sellers, and n vidya's in the grip of shosrt sellers because a short call not backed up is something i don't like let me do more work. i'm not taking any short's word for anything let's go to daniel in florida. >> caller: hey, jim, this is
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daniel from maderra beach. i'm calling about rangold. they have had some problems with the congo and the ivory coast. and i think as a result they seem to be near their 52-week low. and i'm curious to know what your thoughts are about initiating a position at these lower levels >> you know, a huge tsunami of things that were not positive there that occurred, but you know what? i think they're taking it into account with the stock in the mid-70s. i am with you. i know they've been talk being about production lagging in forecast but geez, this stock has come down too much. start a position there let's go to shane in pennsylvania >> caller: first-teime caller, want to say go birds >> and don't forget nova
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what's up? >> caller: i want to say the biotech started selling off before this began, in particular celgene. is the biotech space and celgene a buying opportunity >> they just lost, when i was away, they announced a coo exit. i didn't understand that i don't understand the, ever since bob nugen retired, there have been a lot of things going wrong at celgene and big buy pharma i have no catalyst, shane, to tell you to do some buying i'd rather feel there are so many stocks that have come down that i do have catalyst for i don't have to push that one. i would love to say we're out of the woods. i'd love to sound some sort of all-clear, but i simply cannot do that. look, there are many things that can hurt the bull.
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and that's what you have to consider after a gigantic rally that we've had on "mad money," i'll talk about the non-farm employment report and it may surprise you, can spotify continue to strike a chord with investors i'll tell you whether it can strike a spot in your portfolio, and it might be surprising and how are discount retailers like ollie's bargain outlet faring stick with cramer. don't miss a second of "mad money. follow@jimcramer on twitter. have a question? tweet cramer, #mad tweets. send jim an e-mail at "mad money" @cnbc.com or give us a call at 1-800-743-cnbc miss something head to madmoney.cnbc.com.
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tomorrow's big bad employment report simple we're at the phase of an economic expansion where goo news can easily become bad news. the worry that we have to raise the rates. they are good for the banks. however, rates in general are a problem for housing. i believe a really strong employment number would be met with selling in homebuilders but maybe that view is out of date maybe we're dealing with a different set of circumstances where they have greater fear from interest rates than the recession. where did i get this from? a conference call. it was a tour deforce performance in that conference
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call, and is sent the stock from 67 to 54 the reason stuart miller explained that his business is roaring thanks to the raber participation rate the percentage of the civilian population that has a job or is looking for a job. he said that figure and not the he headline employment number itself is what matters miller's pretty persuasive he said look, interest rate seem to be a flash point for homebuilders, but it's never properly contextualized. what is not talked about enough is participation rate. what we're seeing in the field is that more of our customers are coming in with confidence. they're coming in with certainty about higher wages, end quote.
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the easier it is to get a job, the better the home building business ge gets. while the unemployment rate is very low, that doesn't count all the people who have dropped out of the labor force when those people rejoin the workforce, and they are going to, they can afford to buy houses again basically, there's a lot more slack in employment. i found miller's logic downright stunning stunning -- i know we're building fewer homes than we used to. i know that only the big homebuilders can navigate the challenges posed by federal state and local regulations. the tax bill is to stimulate the economy, it that's good for home buildingers. this may mean that many millennials will be able to move
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out of their parents' basements. but the revelation that we're looking at the wrong number tomorrow is what gives me hope that even if the yield on the ten-year treasury starts to rise again, maybe we should be buying these stocks, and that's a huge change i always say pan ix ic is not a strategy if we see a large pickup on the participation rate, these, all domestic stocks, well, they may be the right names to buy in this new environment that's so much more hostile to international trade. much more money. spotify has helped revive the struggling music business, but can the streamers show a changed industry how to make a profit? and what can the latest earnings statement of ollie's tell us about the state of the u.s. consumer and are the retail rates on the
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earlier this week, spotify finally started trading in the public markets this was within of tone of the l awaited moves in ages. normally when a new company becomes public, we like to play a game called "know youri ipo". but they did a direct listing. they list brand-new shares it's not diluted and that's not the only unusual aspect to this deal.
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spotify was emphatically not looking to make a big splash as part of this event company said it wanted to give its shareholders an opportunity to cash in on the shares if they wanted to. they didn't do a roadshow. they wanted to ring the opening bell on tuesday. the ceo barely gave any interviews, barely collaborated with investment banks at all as it was explained earlier this week -- >> spotify cared less about, about that branding element and about raising capital, because they have a near-unlimited access to capital in the private markets. i've opini i've been working with them for two years. they've never talked about the bell or coming in here >> i like that he said what's even more important to me is that tomorrow does not become the most important day for spotify, end
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quote. i love that. so often that seems to be the top. he wasn't desperately trying to raise capital. he was trying to do right by his employees in every respect it matters. this was the anti-ipo. for those of you who have been living in a cave the past decade, spotify is the online streaming service that lets you listen to pretty much everything under the sun, but you have to sit through ads, kind of like radio. or you can pay $9.99 for unlimited songs any time anywhere it's artificial intelligence, it collects a tremendous amount of data about your listening habits and use it to help figure out what you want next i'm not kidding. spotify's the largest music streaming service on earth it has 159 million active users, of which 71 million are paid
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subscribers. these numbers are still growing like crazy last year the user number increased by 29% those are huge numbers it's one major reason why i'm excited about this story spotify is a terrific concept. not because it almost single-handedly saved the music industry even big-name haters like taylor swift have come around she just released her new album on spotify last week before spotify, music had been declining for 15 years the only place that ever made any money was concerts but after spotify subscription-based service model started gaining traction the industry started growing people who want to shell out $10 for an album on itunes will gladly pay $10 a month for access to tens of millions of
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songs. some believe it's still in its infancy, i agree while spotify's 159 million average monthly users may sound like a lot, there are 3.6 billion people on earth with internet access. in just the 65 countries and territories where they do business right now, there are 1.3 billion payment-enabled smart phones that gives them a lot of room for growth it's going to keep expanding in markets it's already operating they are gradually taking over the world. even if apple can't catch up to them, it's hard to imagine anyone else getting in the way last year spotify grew their numbers at a 39% clip. that's a slow down from 52% g.o.a.t. growth in 2016, that's still a terrific number. these are stories where you don't want to see them turning a profit yet, because investing
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their cash back into the business is much better. the balance sheet's clean as a whistle. short term investment, zero debt no wonder they can get away with doing this totallisting. it's one of the service people don't mind paying for. they tend not to even think about paying for it, like netflix or amazon prime or sirius xm or apple storage you don't want to lose your pictures i know i pay automatically for all five services. i never give it a thought. spotify's indispensable in my house, in my kids' places. but the lead adviser, morgan stanley set a reference price of $132 not that they were low balling it it quickly shot up and ended at
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a 169. all to be closing at $149, down 10% from where it opened but up 13% from the reference price then today it sold ovulate ff lo close lower. these don't worry me this is not ain ipo. the whole spotify listing was about making it easier for insiders to invest and sell. look, because it's not an ipo, it's not a lockup. maybe they'll have to do a secondary offering after investors get more comfortable with the stock that's fine. spotify is the kind of stock
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that gets cheaper. it makes it cheaper than the much-slower growing sirius 4.9. and 8.1 for netflix. with a similar growth forecast if you give spotify the same valuation, you know where the stock would be $275 compared to peers, it could turn out to be a real bargain if it goes less, you have even bigger potential spotify belongs to an elite group of companies where you don't think about paying the bill i bet growth-oriented money managers would be willing to pay a lot more for its stock yes, i do like spotify that much let's go to hunter in pennsylvania hunter >> caller: hi, mr. cramer. thank you for taking my call from here in montgomery county,
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p.a. >> may hoy home area, what's up >> caller: my question is about live nation. i bought the stock a few years ago. it's done well for me, but it's taken a hit since february and now the doj is going to look into it for antitrust issues is it time to sell now and take my winnings, hold through the storm? >> i saw that. i thought about michael rapinno. that, i don't like the justice department investigation oh, boy, i hate to tell you to ring the register because of what could happen with a doj review, so i'm going to tell you not to i'm going to tell you to hold on, take a long-term view. chad in georgia. >> caller: boo-yah, ski daddy. pandora's currently down about 60% from a 62-week high.
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with the rattle of spotify, would be smart to increase my position in pandora? >> no, no. increase your position in spotify. i can't believe it came this cheap, but they didn't do a traditional pop ipo. let's go to bill >> caller: i need your help crteo. the shares that tanked, they got creamed in december. they reported well, fourth quarter 2017, but the stock is still at 26 and change >> you don't need that stock there are so many other stocks that are doing well. that's not one you need. i spot, ha, ha, a real winner,
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spotify, its growth is real music to my ears you have my blessing to get in on this newly-public traded to the. ollie's bargain outlet is up 75%. is it time to buy? who says this isn't the most interactive show on it television after my take down a few weeks ago, pennsylvania real estate trust is here to tell its side of the story rapid fire, tonight's edition of the lightning round. so stick with cramer what han
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outlet stock ollie's seemed to be unstoppable because consumers can't resist a big deal these guys beat amazon on price, at a time when so many breick an mortars are trenching. it's up 13% since the last time we spoke to the ceo. ollie's reported it was 1.65% and was down much more during the part of the session. the reason even though the company delivered a nice two-cent ear earnings, stronger than anticipated store sales, the revenue guidance came in below some firms' expectations so, is this buyable pull back? or should we be concerned about the guidance let's speak with mark butler, the chairman ceo of ollie's.
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welcome back to "mad money." good to see you, sir have a seat, great to he ssee y. i've been following the company since it became public you've done consistently better. but you've been sticking by the mantra today someone decides that's not enough you're ahead of planning on every metric >> since we went public in july of '15 every single metric that we have set forth, every single guidance we have either met or exceeded we have beaten every single one. i always said we were a 1% to 2% comp story that was it. no more. we've asked everybody. the analysts who have been with us from the beginning, they get it we are 1% to 2%. we gave that guidance again. we are coming off our biggest, our brightest year ever. >> you are the strongest retailer i follow. that makes sense you said closeout deals are at
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historical peak. let's not forget toys "r" us is this as good as of' evyou've seen it. >> absolutely never better since we've gone public i think the buying environment has helped because more people know about us they see us on tv. they hear us at investor conferences. more and more manufacturers have the twoen gotten to know us. >> so the president's been against amazon bezos, maybe got a bad prime delivery i don't know you are under amazon in the prices >> underneath the marts. that's what we attempt to do but, you know, brick and mortar. this is how we make a living it's never been better for us.
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not ever been better for us. ollie's army >> 9 million members >> that's incredible >> what we're going to do is introduce ranks this year. so hopefully, you'll earn to be a three-star general >> three-star general, what kind of discount do i get >> an additional offer, special offers i think it's really going to resonate for these bargain-nauts. >> i love home depot how much room do you have in this country to put up more stores >> we think we can grow 950 stores it's a pretty good poke. so there is no reason why anybody should be less excited about ollie's today. >> are you in texas? how many do you have >> we don't have any in texas yet. we'll likely look at our next distribution center in texas
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that will open up the door for texas. >> i am trying to get people to understand that even though the economy's better, the consumer got used to bar gains, they really didn't graduate to more expensive stuff this time. is that just a new grew gallonity and you're a beneficiary? >> i think so. and it started in 2008, 2009, when we had what we call the trade-down effect, where people really needed to save money, and they liked it. they gave us a shot. they liked what happened when they came in we said thanks and they kept coming back. our business has never been better >> this toys "r" us has got to be the best. you're open for business with that inventory >> i think this is the perfect storm for us number one, there's going to be a lot of product available these manufacturers are losing one of their number one, if not their number one customer. the second thing is, you know, that toy retailer sold a lot of toys brick and mortar.
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hopefully a lot of them or some of them are going to come to ollie's and buy toy closeouts, i think it's a win-win for both sides of the equation. >> there's no doubt about it there are strong stores. but the bankruptcies continue. when i see bankruptcy, do i think good for ollie's >> i think so. it usually takes a little bit of time for the pain to set in and i become attractive on the leasing side we, much like we get our goods, we're tough on our leases, but we pay we revitalize shopping centers, bring a lot of customers that's why our parking lots are packed the stores are rockon. . >> people got a chance it was such a great opportunity.
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>> that's mark butler, the chairman and ceo of ollie's bargain outlet holdings. this is the best retail that we've covered. i think it's getting better. at&t provides edge-to-edge intelligence, covering virtually every part of your retail business. so that... if your customer needs shoes. ...& he's got wide feet. ...& with edge-to-edge intelligence, you've got near real time inventory updates... ...& he'll find the same shoes in your store that he found online... ...he'll be one happy, very forgetful wide footed customer... at&t provides edge to edge intelligence. it can do so much for your business, the list goes on and on. that's the power of &. & if your customer also forgets... socks! ...& you could...
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it is time time for the lightning round and then the lightning round is over are you ready, ski daddy time for the lightning round going to start with nina in maryland >> caller: hi, jim, thank you for everything i have alibaba >> it is one of just a handful of chinese stocks that i like here i like buy do and i'm not backing away how about brian in florida >> caller: hey, jim, thanks for having me on your show >> quite welcome >> caller: you interviewed bill sandbrook and he seems like a great guy. he talks about growing his company that currently stands at 170 million. >> the stock is, it's now 12 times earnings just go straight-out earnings.
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deserves a 15 mobile >> buy, buy, buy >> i agree with you, by the way about bill sandbrook i think he's a good man. let's go to ron in california. >> caller: boo-yah, jim. >> boo-yah, ron. >> caller: what's your take on metro focus? >> stay away, it's too hard. let's go to bill in florida. bill >> caller: hi, jim i want your opinion on the -- partners >> why did we sell i don't like what's going on with furk. but i think you're getting an opportunity to say i don't like these limited artnerships, let's go i need to speak to neil in missouri neil >> caller: i'm planning to put financial stock into my portfolio, and i was thinking
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about synchrony financial. >> synchrony's okay. my friend says that that visa chart's really good. and i like visa management trying to get them on air. i would rather you go with visa. let's go to kathleen in utah >> caller: yes, mr. cramer, i would value your opinion on axp. >> holy cow, another one i don't like as much as visa i would prefer visa than american express let's go to ron in texas >> caller: thank you for taking my call. i'm asking about eght. >> i remember this when we started 13 years ago but i'd rather see you in cisco. and that, ladies and gentlemen, is the conclusion of the lightning round! >> the lightning round is sponsored by td ameritrade so all...
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as i told you before, it's been very rough owning retail-related real estate it's made the stocks like toxin to your portfolio. i could be wrong maybe the worries are real overblown. we always want to hear the other side of the story, which is why i'm so glad pei is here with us
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tonight. they own 29 retail properties, mostly shopping malls across the middle atlantic, philly, washington, d.c. but pennsylvania real estate also has a fwgargantuan 18.5. when the rate gets that high, there can be a lot of problems with the market. let's go to the chairman and ceo of pennsylvania real estate trust. welcome back to "mad money." good to see you, sir obviously, the industry's, j.p. morgan, saying your funds from operations guide well below the street when you recently reported your stock is almost at its 52-week low. and yet every move that i've seen you make, whether this be changing some of these week hangers, to this fashion district project, they've all been good, so can you explain to
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me the disconnect between what you are doing and how people are viewing it >> well, it all goes back to jason kelsey's line, hungry dogs run faster we've run faster we've been out in front of the problems we've sold off 40% of our portfolio. >> and a lot of those have done quite poorly, you sold the bad stuff. >> 17 malls, 25 anchors have closed in those 17 malls we've sold we took back 12 anchors. ten of them are leased two are about to be leased and so we're, we're well ahead of the curve as it relates to the problems, the headwinds that we see in the retail space. >> you did say there would be more bankruptcies, but it seemed that would be the low quarter. >> exactly
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look, bankruptcies are never a good thing, but we've turned them into a tailwind of the 12 department stores that we either took back or got back, we've increased the rent by an eight multiple, getting returns in the high single digits and replacing them with tenants like burlington and tjx and dave and buster's >> it's important for people to note that sears has gone from 27 to 8 j.c. penney, 31 to 16, macy, 35 to 14. whatever is left of macy's is doing well >> we have strong anchors remaining. the rationalization that's occurred in the department, space has been a good thing. we didn't need that many macy's or that many sears orthat many jc penney. you replace them if you have better assets with bett
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better tenants you drive more sales >> there is a renaissance of the remaining retailers. they are beating their numbers plus the apparel is killing it apparel is often sold in a mall. has the perception, of which i've been part of, overshadowed a reality of stronger companies coming in, and you're thinking about the fashion district in philadelphia under retail, you make that point right at the top saying kansas city has more high-end retailers than philadelphia. under retail downtown, and the companies that you're bringing in are not your traditional apparel companies. >> no. i mean, we're down to around 40% of our malls are apparel you know, we differentiated to dining, entertainment, health and beauty, fitness. on and on and on i mean, very different curation of tenants that we've done in
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our properties and we'll do a similar thing at the fashion district where we'll bring in, you know, entertainment, i mean, live entertainment venues and all kinds of uses that are, you know, it's not your grandmother's mall anymore >> no, look, i was there when the galleria opened in town. and it was all those traditional department stores and my dad worked there but actually, that's not the way the millennials shop anymore my generation, but the millennials want experiences, and you're giving them those >> who would have ever thought, virtual reality in a mall. that's real today. but, you know, look, the best test for us is one, occupancy is headed up. two, our sales year to date are up 8.2% year-to-date and our renewal spreads are trending positive. so all of the metrics that one looks at to say how are they
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doing are positive >> right now, and 95.9% occupancy >> right that's correct >> i think, there's just not a lot of people who follow you it's not big but at the same time, i know you from when i was growing up as one of the most conservative operators. somehow people feel that you have taken on more risk. you've taken on dramatically less risk. >> well, we've been very careful in our capital allocation. we've sold assets off and used that capital to strengthen our balance sheet, and invest in quality assets the result of which is this is the time to buy pei. we're tremendously undervalued our difficult devidend is safe we've got $14 million in pent-up revenue that we think over team we' -- teime we're going to be able to increase the revenue. >> there's a guy i know who says
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if you don't buy the stock, it's going to be taken over by someone. that's a possibility you've got great properties and it's worth more than it's selling for. >> that's right. my job is to drive shareholder value. we need to think strategically, we're open to that >> that's exactly how i feel pennsylvania real estate investment trust, pei. it's not getting credit. stick with cramer. - learning from him is great... when i can keep up! - anncr: thankfully, prevagen helps your brain and improves memory. - dad's got all the answers. - anncr: prevagen is now the number-one-selling brain health supplement in drug stores nationwide. - she outsmarts me every single time. - checkmate! you wanna play again? - anncr: prevagen. healthier brain. better life.
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hello. give me an hour in tanning room 3. cheers! that's confident. but it's not kayak confident. kayak searches hundreds of travel sites to help me plan the best trip. so i'm more than confident. forgot me goggles. kayak. search one and done. one noticeable decline today is micron. this is a stock that i've been telling you to worry about because after the report of the quarter, the stock peaked and it has been going down. it seem as little overdone, but that's a fragile situation like i said, there's always a bull market somewhere. i promise to help you find it right here on "mad money." i'm jim cramer, i will see you
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tomorrow >> 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." ♪ who believe they have a solution to a problem faced by millions of americans. ♪ my name is kevin kiernan... and i'm melissa kiernan. and we're from waldwick, new jersey. every morning, i come outside, and there's garbage all over the place. so i finally put my husband, who's mr. fix-it, to the test,

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