>> dan suzuki. >> health care for all of the reasons stated before. >> dan nathan. >> cart or friends mad don't go anywhere. "mad money" with jim cramer starts right now my mission is simple -- to make you money i'm here to level the playing field for all investors. there's always a bull market somewhere. and i promise to help you find it "mad money" starts now hey, i'm cramer. welcome to "mad money. welcome to cramerica other people want to make friends. i'm just trying to make you some money my job isn't just to entertain but to educate and teach you s call me at 1-800-743-cnbc. or tweet me @jimcramer. has the stock market been too strong for its own good? as we turn the page to may people are starting to worry about potential overexuberance which is one reason why it lost

162 and the nasdaq declined 0.57%. in the first four months of the year the dow jones industrial average had its best performance since 1987, nasdaq best suns 1999 and nothing scares the daylights out of professional traders more than those two years. the specter of '87 and '99 if you're a veteran like i am you know they had a horrific pattern. rapid-fire rallies that led to a pair of ignominious crashes. the last anything wants to hear that 20191 looking like '87 or '99 how worried should we be is it time to start doing some selling? >> sell, sell, sell. >> especially since the federal reserve told us this afternoon inflation may be poised to make a comeback the next move could be to tighten potentially dashing a key pop to the bull. okay, as someone who traded through both periods, not to

toot my own horn too much, but when the market crashed in '87 i was entirely in cash when the dotcom bubble burst in 2000, the epic rally of 1999 i shorted the tech stocks to kingdom come i was a hedge fund manager i can't do stuff like that now my first takeaway is simple. any time you have a remarkable run it never hurts to take something off the table. nobody ever got hurt ringing the register bulls make money bears make money, hogs, they get slaughtered. in other words, please don't be greedy i don't actually believe the 2019 looks like 1987 or '99 but i do believe in being disciplined. we trimmed our position in my charitable trust join the club. i don't expect a reprise of the '87 crash or dotcom bust i mentioned it several times because i do not want to scare

people i don't believe it's going to happen i think we'll be fine. however the dow up and the nasdaq up 21%. the perfect maybe to just take a little off the table hey, come on many people have huge gains here let's be sensible. why tempt fate but trimming is all you should do i wouldn't sell everything like i did in '87 or short the nasdaq like i did in 2000 why not? aside from the velocity, 2019 has very little in common with either 87 or '99 '87, a time when the ten year treasury supported a 9% yield. man, is that high and the economy was red hot, the dow jones and s&p rallied relentlessly it was a nauseating nosebleed run with the big industrials taking charge here that's all that you saw then look, very few break, right? at first it made sense but as the averages marched ever higher we reached a point where the s&p 500 was selling for 29 times

earnings that was the most expensive i ever recall in my career what was really going on here? as someone who doesn't like to sleep even to this day i know why that happened. at the time japan's economy, not our, japan's economy was ascending and the japanese had enormous sums of money at the opening japanese buyers would come in and take stocks up lifting them to new highs every day, just kept going higher and higher everyone who traded for a living accepted that our stock market was a play thing for tokyo and buyers from tokyo didn't seem to care one whit about things like valuation and consultanted started to sell portfolio insurance. they don't use it anymore. they could use futures to protect you against declines if it rolled over, big funds like that but portfolio insurance bennet work the way it was supposed to. come october the japanese seemed to run out of ammo and the huge competition from bonds overwhelmed the stock market

we had a proximate cause james baker told the germans they were abusing us with their exports. we were just ripe for big sell-offs. once the averages started rolling over the portfolio insurance kicked in and suddenly the futures overwhelmed the stock market within days the dow and s&p lost more than half their value now the circumstances are totally different here we have much lower interest rate, ten-year at 2.5% which means stocks are the only asset class in town. the average stock in the s&p 500 trades at 17 times earnings. not 29 times earnings like it did here, okay there's been no ridiculous buying by foreign countries and that i've seen there's nobody who is flush with cash coming from overseas. the only real thing stocks have soared like they did in this period but, you know what, that's because we're bouncing back from a huge decline in the fourth quarter of 2018. there's just no comparison

i think it's based on the bear market and undoing of that 1999, look, the dotcom bubble made a ton of sense at the time. what you're looking at is this part before the daily number focus on this part this was all about the rise of the internet the bulls thought the web would change the way we do everything. you know what, it did. they were right there just early. cisco, intel, microsoft were at the forefront but the real drivers have long since vanished telco companies that don't exist, website, see you later. the more blue chip tech stocks sold for anywhere, 40 to 80 times earnings, the more speck ti -- it's nothing like today. even as it's within spitting distance of the market gap, facebook trades at 21 times next

year's earnings and amazon and netflix do it on sales and earnings but cheaper than they've been even the cloud kings are nowhere near the outrageous levels in 1999 i'm not going to totally exonerate the nasdaq we have a tsunami of ipos. that is disconcerting to me. this week we got seven deals many technology companies kicking around for ages. when you get too many ipos in one sector it's toxic to the rest of the group because all of the new supply tends to overwhelm the demand when supply exceeds demand prices, what do they do -- >> sell, sell, sell. >> they go down. so the current deluge of deals is unserving to anyone who traded during the dotcom bubble and i did and i'm unnerved now there's simply too many companies coming public at the same time. for the record next week's uber

ipo is the most probable cause for a sell-off when the facebook deal blew up in 2012 it sparked a correction. it could happen again with uber if it's priced poorly. if you're worried about the bull market because stocks have run up too far too fast and feels like '87 or 1999, two years that i most dread, calm down. 2019 is nothing like '87 or '99. if the endless tide of ipos won't cause a huge crash that doesn't have anything to do with the actual economy. bottom line, we have had a terrific run i am blessing you to do some selling tomorrow but other than that i think we're in fine shape. some are overheated but i think it makes sense to stay the course neal in georgia. neal >> caller: hey, jim, megaboo-yahs from georgia. >> that's a giant-size boo-yah >> caller: hey, last monday

after the close transocean reported earnings and beat on the top and bottom and provided a better outlook for offshore drilling but yet it dropped worse than it did the last report they missed by a long shot many i missing something here? >> look, here's the deal, this and schlumberger, they are based on offshore drilling and it has not come back the way any of these companies have thought they're not good enough and that's what matters. scott, in my home state of pennsylvania scott. >> caller: hey, jim, grew up in pennsylvania and listened to you every day. >> sweet, thank you. >> caller: you suggested and i purchased in december, ringcentral, 2014. sadly i haven't bought more but i still own it what do i do with it >> we like the ringcentral we spent -- i think it's a very,

very good company. you know what, if you just have an odd bid of it, up 40% and like i say, no one ever got hurt taking a little bit of a profit. it is a good company, though let's go to mike in florida. mike, mike, mike >> caller: hi, jimmy. >> what's up, mike. >> caller: hey, i was calling about tandem diabetes today. >> yes. >> caller: i know you've been bullish on that for awhile earnings just came in this morning. the stock's down a little bit. there's been a lot of chatter about the other larger companies that have been reported today. >> right. >> caller: didn't hear anything about tandem >> this stock at one point was up eight then down three then up six. like dex com was up four these stocks all sold off at the end of the day i like the quarter and i like the dex com quarter but this is what happens when you got a hot market and a lot of people short. it was fine but it's high value. i do like it though. we've had a terrific run so consider trimming.

it's okay. i'm blessing it. other than that stay the course and being realistic how not -- let's just say how much the market has run on "mad money" beyond meat is hoping to change the way we eat and revealed plans on prices i'm eyeing the new future of food and telling you if it could be worth owning. shares of netflix for textbooks missing its mark after earnings or do they have it all wrong i have the ceo a company up a whopping 150% i'm sitting down with the ceo of amd so stay with cramer. >> announcer: don't miss a second of "mad money." follow @jimcramer on twitter have a question, tweet cramer, #madtweets send jim an mail to madmoney@cnbc.com or give us a call at 1-800-743-cnbc

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when intel reported last week their forecast was downbeat no commentary about it and the datacenter plummeted overnight if you took your cue from intel and many did you had to believe the semiconductor business was facing problems but i told you there might be another explanation that maybe intel was losing market share to its competitors like amd sure enough when advanced micro devices reported they told a different story and the company delivered a solid top and bottom line, beat guidance for the next quarter was pretty much in line and the call was bullish about the datacenter it wasn't enough to send the stock higher lost 82 cents after being up more than a dollar but amd was already up dramatically so could it have more upside? let's check in with dr. lisa sue to learn more about where the company is headed. welcome back to "mad money." lisa this day last year your stock was at 11. it's gone up 16 points

why? >> jim, you know, it's been a great year it's really been a great few years and for us it's all about products and we have large markets in the gaming market and datacenter market and we're all about our products and gaining market share. >> it's been a tumultuous time for some semiconductor companies and what a lot of people cheered was that you held your outlook steady why is that good in this environment? >> well, look, you know, semiconductors is an exciting place and you do see things go up and down but from our standpoint it's about building a long-term plan and when we started 2019, 2019 is a huge year for us. if you look at our product cycles, we are, you know, launching new products in all of our markets and so we said, hey, this is a revenue growth year for us, you know, starting out at a lower point in the first quarter but building up over the next couple of quarters and

still see, you know, tremendous excitement around our products and so from that standpoint that's where we're focused. >> i want to quote a piece in "wired" magazine that said playstation's next generation -- next generation console ticks all those boxes starting with amd's chip at the heart of the device why does it help to check boxes if they've got an amd chip at the heart of the device? >> we are so honored and proud to be part of sony's next generation playstation this has been a long-term partnership with them and love gaming and think gaming is a really good secular growth market and what we can do, you know, what we have done with sony is architect something, you know, for their application, for their special sauce and so, you know, it's a great honor for us. we're really excited about what the next generation playstation will do and happy to be a part of it. >> you're a little modest. do you that for amazon web services and for apple and do it

for google cloud so these are all your partners now and they want your partners -- even a half dozen years ago -- >> you're right, jim our focus is really on partnering with, you know, the best in the industry and our view is that our technology, you know, with the customers' application can drive, you know, substantial technology as well as revenue growth and so, you know, for example, with amazon we're working very closely with them on their datacenter they've launched a number of new instances with us in the datacenter and we believe that cloud is a great market for us we're very happy when google announced their cloud gaming solution here in march again, it's one of those things where we've worked for the last several years to build a tremendous partnership. >> now, last year, stock had ups and downs when it was down at 18 you came on the other show and said, look, it's a continuum it's a multiyear move. don't look at this one snapshot. that's how it played out, didn't it >> i am a huge believer in the

journey. the journey is, you know, you put together in our business you put together road maps that sometimes take three or five years to play out. so, you know, we're making large bets we're really looking at where is the market going where are we best in technology? and, yes, it's a long-term play that has some short-term things as well but very much mow cussed on the journey. >> longtime competitor in your 50 years longtime competitor intel announced they saw weakness particularly in some of the areas that datacenter but personal computer and did indicate for a lot of people that maybe things had slowed particularly in the datacenter but when i look at your numbers it seems like business as usual. is that true >> first, thank you for the 50th anniversary comment. today is our 50th anniversary as a company and we're proud of that look, when we look at the datacenter it, i mean it's a good market. it's a very good market. if you think about it, people have much more data. we need much more compute -- we need to analyze all of that and

we see it as a growth market for us now, you know, there are some short-term pockets of inventory people talk about but our story is about share gains and, you know, middle of this year we're coming out with our next generation epic processor. we call it roam and doubles the performance so it's a significant inflection point in technology and that's what keeps us, you know, really excited about the prospects. >> so the idea that the datacenter conceivably could have a major decline doesn't sound right. it could be a pause but you still believe in the long-term growth or wouldn't be adding all these different iterations. >> i absolutely believe in the long-term growth there might be some shortt dynamics but with all the data out there and the compute needs it is a great market and it really appreciates great technology and so, you know, that's where we differentiate ourself really focus kelly on high performance computing. >> i know there are a lot of professionals who watch the show and the people, home gamers may

not understand but we'll try to get it right the gross margin for semiconductors often so important and the late great andy grove once barked at me, i said, why is this obsession with being 63% margin, 62% gross margin you have 41% as your outlook can you ever get to those margins that andy grove from intel thought were so important to profitability >> well, look, i totally believe in margin growth as well and as i said this is a journey you know, we grew margin five points year on year in the first quarter. you know, that's a pretty good move so the way we look at it is as our products get more and more adoption, we will grow our margins and our long-term target is, you know, 40 to 44%. i think we're making good progress towards that and more importantly as our products get adopted, you know, i think we have just a broader, you know, business base overall. >> it is important to point out revenue is down, gross margin up is highly unusual, a great combination when you think about it if revenues come back and you

admitted there is a pause but things could bin the second half strong. >> we definitely believe there is a strong opportunity to grow and then, you know, as you look at our products as the new products come out particularly in, you know, pcs with our rise in product line, in datacenter, with our epic product line and then we have a new gaming chip coming out as well and those are all scheduled for the middle of this year so we're excited about those. >> one last thing, when i first met you i know that at that point, i had always worshipped intel and was an intel hawk and said, jim, we are in the conversation and we'll stay in the conversation, so i'm proud of you for telling me that and you certainly changed my mind. next three to five years just going to continue to grow the company? >> jim, we are so excited about what we have in store. i mean i look at this and i say, look, the last three or four years we've been focused on our products that's how we're here in 2019,

2019 is going to be a big year for us we view it as specific thing with many things in the hopper so for our engineers it's all about high performance computing and putting the best out there. >> terrific. i want to congratulate, 50 years and all the great things you've done including that remarkable run since you came in. dr. lisa su, president and ceo of amd thank you. >> thank you, jim. thank you. >> announcer: cnbc's capital exchange --

you know we're getting flooded with initial public offerings and i have mixed feelings about almost all these deals. too much supply. supply can slay even the strongest bull on the other hand some of them can be incredible opportunities especially if you get a piece of the deal where it's priced we've got seven companies poised to go public that's crazy but one seems

intriguing beyond meat the maker of plant-based vegan faux meat that's almost as good as the real thing. beyond meat which will trade under bynd is expected to price between 23 and 25, now originally everyone was looking for 21 at most but the demand is so strong they had to raise the price range and the deal size. so what makes beyond meat compelling and more importantly will the stock actually be worth buying if you can't get into the allotment, the actual deal here's how -- why don't we do this let's play a know your ipo it's become one of the fastest growing food companies brilliant concept. millions are vegan or vegetarian or feel grossed out by eating the corpse of a dead animal. that's where beyond meat comes in they developed a plant-based alternative. it's got the same taste, same scent, same texture of real meat the company uses proprietary process to map out the chemical

architecture so they can copy it using plant derived fats and proteins and end game totally indistinguishable from the real thing in terms of taste and a word that i like call mouth feel you know, you may have seen it in the supermarket they're in 17,000 grocery stores often in the meat aisle or 12,000 restaurants and foot service outlets. they sell beyond burgers the company's ground beef alternative from t.g.i. friday's to bear burger which used to serve elk and wild boar. now they serve beyond burgers. not just beef. beyond meat is also working on faux pork and faux poultry but the big products right now are beyond burger and beyond sausage. the packaging looks like real meat right? the sizzle soups real. it smells real and when you eat it, it surprisingly as close to the real thing although you definitely can tell the difference can you get them at disney world, legoland. if you stay at the hyatt, rather

than marketing the stuff solely to vegans and vegetarians they have less than 5% of the population they're trying to attract regular meat eaters. their whole pitch is and i quote, eat what you love, end quote. it's just like real stuff only healthier and without the animal welfare and sustainability worries plague on millennial meal eaters so troubled by all this stuff see, i mean, look, right the company is trying to mimic the success of plant-based dairy. we've seen an explosive demand for soy and almond milk as they have it accounting for 13% of the category beyond meat wants to do the same thing with burger and sausage and 13% of the meat market would be worth 35 billion in annual sales. now so far it's worked well. the business is growing like a weed the demand is oft charts and research labs keep working on new things

which brings me to the financials it's another ipo setting up spectacular revenue growth it grew, get this, 170% clip a massive acceleration from 101% growth rate in 2017. we know from management's guidance that the numbers keep getting better roughly they tripled in the first quarter. it's not yet profitable. i he really don't want it to be profitable but spending money like crazy to build it out and fend off enemies because the sales keep growing their margins are headed in the right direct 2017, gross margins what they made was negative 6.7% last year it rose to plus 20%. still i don't expect to see positive earnings any time soon. that's okay. they have hot new product and they can afford to invest in its success. we know that because meat bash we know that beyond meat's balance sheet is solid especially because they're about to raise 250 million on the ipo

and posted 200% plus revenue growth thanks to new deals with carl's jr. and t.g.i. friday's they believe it grew by 459 to 488% in the first quarter. that's magnificent their gross margins have risen to 25.6% up from 20% last year. i bet you think -- wish you had invented this company. but it saw a major improvement last year. i think this is exactly the kind of growth story the stock market tends to adore in a year that's already been chock-full of ipos it's the fastest grower of all of them. i doubt there will be another lyft where it was decelerating by the time they became public my only concern they have a competitor in the form of the impossible burger from impossible foods and what i hear it tastes a little more like the real thing even though beyond burger is healthier. burger king is selling out of the impossible

i'm betting there's more than enough room for two players in this industry because it's rapidly growing. if plant-based meat turns out to be anything like plant-placed bilk there will be enough business to go around which brings me to the big question. how much is beyond meat worth? at the midpoint it's going to be very expensive already trading at 17 times last year's sales not earnings sales. of course, they can keep growing on a 200% clip this year and the stock is trading at less than six times 2019 sales so i can get that put this in per peck spiff when pinterest came public it sold 0 times and zoom video, 50%. beyond meat is growing faster than those, i suspect investors will be willing to pay through the nose for this one. if the stock immediately spines to 30 bucks, i be a buyer. $35 we're reaching levels frankly you need to be cautious. here's the bottom line, beyond meat looks like a fabulous company. my main concern here is simply that the deal will end up coming

in way too hot because everyone knows it still you got my blessing to do some buying if you can get it for less than $35 in the after-market so long as you only use your discretionary "mad money" portfolio as this is the very definition of speculation doug in california doug. >> caller: hey, jim, it's actual david in california. going public 90 days ago, a former management team that got bought owl to celgene and went public 90 days ago and they're just starting to get initiation coverage on their company. would now be a good time to start? >> that stock just got hammered. again, i happen like to like the biopharmas i don't like them out of the chute. if something was going to buy it -- a lot are due for takeovers they would have bought already. for spec if you put it away you'll be okay

guy, this beyond meat could be interesting but i don't want it to come in too hot you have my blessing to do speck live buying. i'm hitting the books to find out how earnings check up with cheg how should you be playing the tech titan i'm eyeing it after earnings and rapid-fire, tonight's edition of "the lightning round" so stay with cramer. through the at&t network, edge-to-edge intelligence gives you the power to see every corner of your growing business. from finding out what's selling best... to managing your fleet... to collaborating remotely with your teams. giving you a nice big edge over your competition.

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when a company reports earnings and a stock gets hit that doesn't mean it had a bad quarter but maybe stock expectations were too high take a company that used to be phone for textbook rentals now it's on demand interconnected learning platform and provides digital services and can help with homework or pick your classes or help you decide where to go to college. as well as textbook rentals. chegg is up about 550% however it reported that it had run up dramatically so when it delivered good results, management raising a full year

forecast wasn't quite good enough it robbed and got robbed 39 to 35 this wasn't a bad quarter. it had people thinking it was a little light it wasn't perfect but few are. still real strong and the pullback could turn out to be a terrific buying opportunity. don't take it from me. let's talk to dan rosenzweig to get a sense of the quarter and long-term products welcome back boo-yah. >> hello, my friend. >> a big hello to zach ertz. he watches "mad money" because he needs to learn about investing in case the football thing doesn't work out. >> eagles unbelievable tight end who was the star of the league and i've always had ertz and now i have a second ertz. >> you have done something remarkable you went from what is some people say pedestrian but fabulous if you're a parent saving in textbooks to offer a soup to nuts platform of what

you're going to be part of subscription economy tell us about it. >> well, you know, interesting, the transformation started on your show. you know, we hit an all-time low several years ago and you were kind enough and generous enough to give us the opportunity to articulate where we were going and you said to people, look, just pay attention and have what happe happens. >> i believe in you. you came on a bad day. the stock had been down. >> 38% >> and you said, listen, i'll do this and i'm a believer. >> it started here so what we believe is this, which is if you ask yourself just a couple of obvious questions, we believe in believing the inevitable do you think more people will need to learn and learn more themes more often and have to constantly invest in themselves for their futures and more likely to do it online and do you think they'll need help? we believe in all of that and so every time we come in in the morning it feels like the t.a.m.

expands. >> from the time we have talked about your company has gone from being a million to actually being now one of the largest markets in the world we shouldn't just say dough met tick. >> the first time we thought to do a t.a.m. we thought 8 million. now there's 3.5 billion people under the age of 30. all need to learn s.t.e.m. and get educated and need support. most people will learn remote. most people are going to need help, human help, technology help and technology wasn't available ten years ago to do these. now we can scale so just in the u.s. alone, we feel like the t.a.m. is 36 million people in high school and college then you add to that the tens of millions of people that have partial degrees then you look at all the people trying to improve themselves going to some of these boot camp, nobody is out there supporting them with the exception of khegg and the newest one, wasn't a surprise, inevitable nonprofit online only schools, there are now millions of students learning that way of

which chegg is building products and services to support them as well and just keeps getting biger. >> one thing you left out is from the point of view as a parent when i asked my daughter about chegg, dad, i saved you a thousand dollars, she said all are prohibitively expensive. there aren't many forces trying to keep the price down of education. >> you saw a big merger between mcgraw-hill and -- >> how about that? >> i thought it was inevitable the fact of the matter is when we invented the textbook rental model, high price book, very expensive where they made money and new books we took that market away. it wasn't our goal our goal was to save students money and help them learn more and get content more accessible so what you're seeing now is such a dramatic change that we're able to use technology to make it personalizable, on demand and relevant and expand the curriculum or the support of the curriculum and do for $14.95 a month.

that's the most phenomenal it's used many times 28 million pieces of content and the students ask 7 million new questions a year. >> i looked at your site full price is overpriced but now the lead is when homework gets tough get tougher. how do you get tougher >> so we believe that students will invest in themselves so chose to go direct to the student, no middleman, no politic, none of that stuff. so if opportunities are willing to invest in themselves we're willing to invest in them. if you take chegg study you can do step-by-step solutions and have q&a and get an answer back in four hours if we don't have it answered or watch any one of our 20,000 plus videos or connect to an online expert for as little as 00 cents a minute if you're willing to challenge yourself and study we're willing to help you go through the process of learning how to do it. >> i want to ask, i'm not going to say -- there was a short seller that said maybe you're

violining some rules that about this, the kind of products you're talking about and also that a lot of schools might not like you my daughter, i go and say listen, schools encourage chegg. where do you stand >> we're against anything that does violation of honor code or cheating you know, the technology we've written so if a student asks for us to do their homework the technology will read it, reject the student anticipate tutor those kinds of things so build all this technology in to be able to prevent those things also we own all of our content so all of our ip is correct. and unfortunately, you know, these things with short sellers can combine a lot of different variables. the company, the services they were referring to aren't ones that chegg offers so, for example, download someone's papers we don't do that you upload your paper to us and we help you understand whether or not you've plagiarized and let you know and educate you and teach you grammar and sentence structure. we do your citations and biba y

bibabliographies no we do not have papers you can download short sellers can do what they will i think that's why we'll have nearly 6 million pay be subscribers to our combined business by the end of the year, 25% of the college market. and you're right, professors do assign us now. they do want us to support because, you know what, they're overburdened they don't have enough time. there are no lab or tutoring 70% of kids, jim, they go to college at state schools, 40% of them are working 30 hours a week or more and average age is 25. 25% of them already have children who is here to support them? only chegg. >> let's leave it at that. integral for the people, my daughters know. >> thank you. >> and my staff. that's dan rosen swieg y you heard the story what's imp. and reaches everywhere. this is beyond wifi. this is xfi.

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alonzo in virginia alonzo. >> caller: boo-yah, jim. >> thank you for coming. what's up? >>. >> caller: thank you love your show watch it every night i'm here with my beautiful 10-year-old niece haley that has a question for you. >> all right >> caller: hi, mr. cramer. boo-yah! i love your show what do you think about kohl's. >> i like you that's what i say and kohl's and the fabulous michelle goss, heavily shorted stock. the quarter won't be that great but i say -- >> buy, buy, buy. >> thank you for calling brian. >> caller: hey, jim, boo-yah from houston. >> brian, what's up? >> caller: well, listen, i'm calling about xom, exxonmobil, short term versus long term. >> you won't get hurt by a 4% yield. no longer my favorite. i think mike is doing a dynamite job at chevron but david faber said maybe they'll bid for

anardarko. i need to go to victor in connecticut. victor. >> caller: boo-yah, jimmy. up 15% on delta air lines. buy, sell or hold. >> very cheap stock at eight times earnings i won't tell you to ring the register but that it's cheap june in new jersey june >> caller: i'm in belmont, your summertime neighbor. >> good to have you on the show. >> caller: hi, dr. jim i want to thank you for your expertise and your opinions. i've listened to you for many, many years. >> thank you so much. >> caller: this is the first time i've been able to get through. >> oh, well, i'm glad we cleared that up. >> caller: yeah, right. anyway, my concern is ail allergan >> the chairman and ceo, my problem, we need to see earnings momentum and see the drug

improved against migraines i don't know if it will be approved soon enough to help a business that i'm concerned about. the franchise, let's go to jack in massachusetts jack >> caller: jim, jim, what are your thoughts on arrowhead pharmaceuticals? >> i didn't see that much, you know, everyone is so excited about it i don't get that i have been saying it's absolutely okay to own stocks that have to do with slicing and dicing of genes but i'm not going to endorse it for anything in speculation brad in michigan brad >> caller: hey, jim. thanks for taking my call. >> thank you. >> caller: just wanted to see what you thought about wayfair. >> i remember that bed, bath & beyond could have bought them. a real competitive and the shorts going against wayfair are dead wrong it represents a great product. the stock is expensive but i won't go against it. joanna in florida. joanna.

>> caller: hi, jim i'm so excited to talk to you. >> oh. >> caller: such a big fan. >> ah, that's nice. >> caller: more than seven years plus i've read all your books. >> thank you. >> caller: and i call you my stock market guru. >> there you go. i like to be a guru. >> caller: hey, jim, the stock i'm interested in buying is vrns >> yeah, data management security look, i've got to tell you, i looked at it i'm recommending pretty much every type of security stock but palo alto is my fair and, ladies and gentlemen, that is the conclusion of "the lightning round. >> announcer: "the lightning round" is sponsored by td ameritrade ♪♪ ♪♪ ♪♪

you want to know the most incredible thing about the quarter that apple reported just last night iphone sales were down 17% the company's flagship product, the thing controlled the stock's trajectory for over a decade is experiencing a fairly steep decline. what happens the stock explodes higher rallying nearly ten bucks or 5% earning itself a trillion dollar market capital laiizatio. it is going through a paradigm shift and it was a gadget maybe, maybe the best in history but it sold tech hardware now apple is transforming itself into a powerhouse service provider and

pretty soon the subscription revenue from all those services will be worth more than the technology itself. the stock caught fire today because it's become impossible to deny the power of that metamorphosis. management told us they have an install base of 1.4 billion devices producing 390 million paid subscriptions, that's up from 270 million a year ago and headed to 500 million in the not too distant future and translates into 11.5 billion in high margin sales up 16% year over year. when i say this is a paradigm shift what i mean is within two years this subscriber base will define the way we judge the stock of apple we're already well on our way to a world with the key metric is subs, not iphone sales a few years ago when they broke out service revenue it wasn't much after-thought it was called. who cared about fees for cloud storage? it's so pedestrian initially the service stream seemed like a nice high margin

business, and the analysts who follow the stock are laser focused on iphone sales and didn't care about wearables which had been growing like crazy and the maniacal emphasis on the phone led them astray the service stream kept growing and they embraced it and realized this is a fabulous high margin of business and doubled down on the conference call they said they would cease breaking out handset margins because it wasn't helpful and preannounced awful numbers and got clobbered and many saw it as a nefarious move i thought it was a brilliant decision because it shooips the light on how it will be valued in two or three years and scene as a subscription company with a razor blade business model the phones are the raisers, the services are the blade and where they make the money maybe followed by consumer packaged good analysts someday. we value them with tons of

recurring revenue differently from the way we value tech hardware company before they started breaking out service revenue it tended to sill for 11 times earnings now 16 times earnings. hardware and services. if not for wearables and service stream it would be valued like hp ink when they view it through the subscription, willing to pay 0 times earnings from the out-years. the stock is all stickier. the more likely a company with loyalty would be tended to view it what would it be worth earnings multiple right now how about $260, maybe more it's only a $210 stock because the paradigm shift is still ongoing and happening too fast for most people to get their heads around so you don't get a lot of people talking numbers like i am. apple has been taken by surprise

by this. they don't think of themselves this way to tim cook who is a fabulous ceo and his team apple is a technology company that's synonymous with truly breathtaking innovation and it is look, he's an undeniable lover of the product as i am for all the wearables, a big spike in ipad sales, resurgent. much too much being made in sub discrepancies to ignore it anymore. that's the way we will focus on it it means apple could have a lot more upside as we calculate the lifetime value of every sub. own it, don't trade it with this quarter we got yet another reason to stick with apple and even after today's terrific rupp, i think it will turn out to be a real bargain because of its embrace of the subscription economy stick with cramer.

i always say that's a bull market somewhere i promise to find it right here for you on "mad money. i'm jim cramer i will see you tomorrow.

cuban: for entrepreneurs, making it into the shark tank is the american dream. what about $1.2 million for 20%? yes. all right. aah! whoo! their passion, drive, and hard work has finally paid off. [ cheers and applause ] but what happens next? we got to make some freaking hardcore decisions. after the deal is when the real work begins. if we don't innovate, we're gonna die. and what happens to those who don't get a deal? it really was a low point. some entrepreneurs have life-altering success. i want $20 million. wow. and some don't. i hate it. i hate the whole thing. you lose my money, you're dead to me.