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tv   Mad Money  CNBC  May 17, 2022 6:00pm-7:00pm EDT

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>> devon energy. >> karen, what do you say? >> i got to say i'm going home with the girl that brought me. the boy that brought me. target really looking forward to hopefully good earnings tomorrow morning. >> thanks fo 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 you but to educate and teach you. put in context call me at 1-800-743-cnbc or tweet me @jimcramer. new narratives here. get your new narratives,
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delicious new narratives used to hawk ice cream in philly, always try to come up with a twist, make it different, but heard so many new narratives today i have to share them cute little vignettes that get people excited about a market they shouldn't be so sanguine about. how we ended up with dow gaining points, s&p and the nasdaq surging. starts with overnights hand it to the chinese communist party, flood the system and gin up the system. put out something about capitalism and lockdowns, some less d
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draconian. we would call these prisons, in china, pent up demand. positive out of china, no matter how bogus, you get a run in some stocks tesla, nike, apple, did they deserve to rally for what could be fabricated news ask the buyers airlines having a good quarter we debate the strength of the consumer, there's nothing more reassuring than a airline telling us it's strong forget about the consumer being home, she's traveling. american, southwest and delta, even boeing went up on this one. news out of home depot, rather than trade down, traded up numbers were spectacular versus the horrendous results from
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walmart. which i may have something to say about later. home building may be cooling off but home depot, people drawn to anything rising in price i go there saturday, go nuts maybe chief financial officer will go with me. he argued vociferously that it's rising mortgage rates, correlation, zero. he has better data than we do. away from the pathetic walmart, all retailers marched higher including the ones who report team, even the convoluted amazon getting out of its own way for once return to the land of the living matters to the rest of the market, lot of people had given up on amazon as we get to end of the month, some of the semiconductor companies will have to own up how badly they're doing. china has people who can't
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upgrade, but one of the semis blossomed. amd. comp computing and aerospace, allowed other semiconductor stocks to take off amazing run. broadcom to the lowly invidium this time warren buffett with investment in citi group that's huge. unlikely to be last buy. he had a gigantic slug of wells fargo, perhaps planning same with citi group. could be the greatest bank stock on earth if buffett keeps buying, citi
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will be able to catch up to bank value. citi will be the one people want because all banks are part of etfs, they trade together, ignited a rally in rest of the group. banks more profitable when the fed tightens, but nobody had the bravery to buy until buffett stepped forward. noted this parent. c capitulation means when buffett comes out to buy things. i didn't participate in the mad dash i don't do it. because usually the information is too late to make a difference by the time you know, they've cut and run. but one money manager's departure was a positive, dan loebs with disney. didn't take long to rally.
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have to believe it's got room to run and could rebound as fast. this is a classic no bad news rally. s shows when you're up 500 dow points, it's all china calling the tunes. 4:00 a.m., it was china, not u.s., fed, ukraine, queen elizabeth -- china has a tremendous hold on our market. when they're allowed to invest in starbucks, apple, nike, they do the quandary is run on the large industrials. nobody can figure that out pancaked by every country's tax regime and lack of aerospace defense business but hearing of marshal plan to rebuild ukraine, would be good for defense contractors and american firms who still make things
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need a lot of cranes for a rebuild. lot of run of the mill winners, too. nearly all the ipos got slaughtered on friday. close was horrible couldn't believe the carnage visited upon any new companies even as we haven't seen many more minted because ipo market is shut. now bouncing what is happening here i think there's subtle thing happening now. haves, airbnb, doordash and block, formerly square, and everybody else bottom line. if we get more chinese good news tonight along with fine quarters from target and lowe's looking nothing like walmart, we'll have another great day tomorrow if we don't, miserable, horrible, walmart style view of
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the world. sporting goods aisle is awful. telling you fishing rods are miserable. go to cabella's. all bets are off carol in texas >> caller: been wanting to tell you this pour for a month, when morning sidekicks made fun of your jacket, something out of guys and dolls tlt, don't they know they were comparing you to marlon brando, ultimate man? >> i thought i was more nathan detroit but i understand marlon brando and accept that i told them off camera to take back that mink go ahead >> caller: along with the post nasal drink. >> i like that go ahead i'm sorry. >> caller: speaking of icons, poster child for this
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environment has been procter & gamble, but since november they're moving sideways two things come to mind, number one is that that's best i can hope for in this environment, but two, having heard walmart this morning, is there something under the surface we all need to wait with bated breath >> no. proctor in the trust, when everything goes wrong, still does well. don't like to use it in same sentence as walmart although i have bought things from proctor at walmart, leave it at that hopefully never the twain shall meet i did play, got cut. went out for nathan detroit, playing harry the horse. never forgave mrs. duesenberry
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alan in north carolina >> caller: how you doing >> having super day, how about you? >> caller: me, too i need guidance. >> came to the right place >> caller: what? >> came to the right place >> caller: hope you can educate me looking at two credit card plays, visa and capital one. visa has eps over $6 a share, selling at stock price just over $200 capital one has eps north of $25 a share but stock price is only $120 i think both are great marketing companies but trying to determine why such a big difference in price/earnings ratio. >> in a recession going to be people visa has no credit risk. i prefer visa.
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i say walmart -- my god! stop it. i like visa, mastercard, then capital one. if we get more good news out of china along with good quarters from target and lowe's, going to have another great i've got vignettes for you days on "mad money" today, interactive after earnings, time to look into it. then a company ceo then a major chain of stores delivered a miserable first quarter. i'll break down what went wrong. if you want to understand the market, watch oil, off the charts on hot commodity to make sense of the action. stay with cramer >> announcer: don't miss a second of "mad money," follow @jimcramer on twitter have a question? tweet cramer, hashtag #madtweets send an e-mail to madmoney@cnbc.com or give us a
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all right. look at this stock run great reminder what happens when wall street gets too negative about a well-run company this video game stock plunked to 110. then turned in a seemingly mixed quarter. stock went down initially, idiots lower than expected sales and higher than expected earnings. oh, boy, peoplewant to take it lower. mixed guidance much slower than expected but forget about that. stock bouncing like crazy. finishing day up nearly 12%.
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why? the results were much better even that did not -- guidance didn't bother me but forecast -- do people just forget that? beginning of a larger rebound for the stock like i think it is but selnick, to learn more welcome back to "mad money." >> nice to be here >> i got a thesis. people made this ridiculous binary issue pandemic or post pandemic plan companies when it was talent or creative play. as we get away from the pandemic, focusing on people with talent regardless of inside or out that's how i looked at this quarter. >> right, we said all along we
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expected demand after the pandemic to be higher than prepandemic and somewhat lower than in the pandemic and that happened in the new normal. if we put out great titles, people show up and we had great launches and results. >> i usually don't start with nba 2k people saying they're going to boycott it in china. why do people make up lies rhetorical things. >> not going to answer that. however remains number one pc sports title in china, over 50 million registered users and nba 2k 22 is in millions of units. great feedback we have great partner in the nba
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league and players association, couldn't be more thrilled with the basketball franchise >> how about the partnership with gearbox new one for me am i supposed to play it with lisa >> you definitely should it's a great game, all new franchise in the "borderlands" universe, based on the tiny tina character, who is beloved. couldn't be more excited great franchise for us >> difficult to talk about zenga, but you own it all. you said jim, i don't own all of "grand theft auto," that is our product but not in way you think. but all the mobile games are yours to do what you want.
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>> "grand theft auto" is owned by -- we're best collection of owned property in and believe with the combination with zenga will be best in the mobile as well policy to own them as much as we can. but long-term trusted relationships with partners that benefit us and our partners. that's why they last a long time, are durable and mutually beneficial. >> if someone from "grand theft auto" is not happy and you're happy, you've favored the creators, right? won't go against a creator who says the game is not ready. >> exactly right rockstar games creates that and "red dead redemption" and other
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terrific titles, we rely on their creative decisions and it's worked out for us again and again and will be true again next week. >> trying to do a little bit more esgn, make it sound like jim has gotten it or something glad to see on monday you're involved with a group of people, including adam silver, one of the smartest guys on the earth >> he is. >> ridiculously smart. tell us what you're up to there. >> our team has in with the youth that house serves, homeless youth, go-to safe place for kids with nowhere else to turn to find better lives.
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been touched in our hearts and giving time and money as well to covenant house i've been involved with them better part of 30 years. we're celebrating ribbon cutting on new international headquarters that houses hundreds of kids and staff to take care of them. 50th anniversary celebration if viewers want to support covenant house, couldn't think of better way to give back. >> when i got involved, i said jeez, how did i not know about this but people are doing great things thank you strauss zelnick. "mad money" is back after the break. thank you. >> thank you, jim. >> announcer: coming up, is inflation getting into the way of everyday low prices
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cramer checks in on walmart, next
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when you make $25 million a year, better get it right. walmart ceo doug mcmillon definitely did not get it right this quarter this morning he really blew it sure, got the top line, but missed the bottom line in truly horrendous way how bad? just back in february, i looked at calendar, turned out not that long ago, walmart forecasted midseason growth now said earnings would be down
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1% embarrassing execution sadly, we own walmart for the travel trust, so lamenting nearly 17 points of pain all caused by belief that doug mcmillon could deliver something better but he couldn't. in fact the quarter overwhelmed walmart, as if somehow they thought it was normal time mistakes, too much staffing because people came back early after omicron, inflation in food prices not budgeted right. bush league stuff. you and i both know this he predicted none of it. thinking he needs to get out of arkansas and see what's going on in rest of the country i'm sure he'll talk about he's been traveling and knows this and that if he doesn't know what i mean, bentonfield is a tired mindset
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it's time to accept that i want you to listen to one of the biggest embarrassments in the conference call, great quote. while we experienced high levels of inflation in international markets over the years, u.s. inflation being this high and moving this quickly in food and general merchandise is unusual sure it's unusual for all of us but it's not usual for you just told us you've had it overseas and it's not unexpected would have thought walmart would have the best handle on domestic inflation given they've dealt with it overseas apparently not, it eluded their ken. decline today was shocking but also deserved. would have thought you were dealing with amateur hour dollar store, not biggest retailer on earth. know that amazon is struggling with his work force, and
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criticized the ceo, he's got catching up to do. but walmart has the benchmark of bad, way too much inventory will bleed over in quarters to come when we needed outdoor gear, had little of it now too much of everything worse, in denial listen to this -- we're making progress executing our strategy. the flywheel -- the flywheel we are building is better for customers and members and more diversified approach to profitability making the company stronger that's it. i'm done no way he uses flywheel after this making a mockery of flywheel it's not a flywheel, it's a store. you pick stuff up if you have to they'll send you things. so what? walmart will always sell a ton
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of merchandise, but seen when the going gets tough they're nowhere to be found. shook to their core by everything that happened last quarter. need to distinguish between the fine people who actually work at walmart and their inadequate management employees didn't do anything wrong but management need to take international people who have seen what inflation looks like, bring them to bentonville by way of seattle perhaps because the current leadership hasn't a clue. maybe can spy on better run chain, costco, in seattle. which would never, ever accept this embarrassing result we sold walmart much higher for my trust but not enough. i punched the damn screen when the saw the awful numbers. almost broke my hand should have. that i have any shares left of
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this beaten down business is wrong. one share of this uninvestable shock is one share too many. ben in georgia >> caller: hey jim, thanks for taking my call hope you're well. >> been better what's up. >> caller: feel like we all have environment has been bad for a lot of stocks. majority of them particular companies not making profit like you always say there are some getting thrown out with the bathwater who are profitable, want to see if you agree that costco might be one of them. >> i'm not going to say that, costco's the best retailer in the world, not one but only one. they've got this guy rich as the fco. and he mccarthy at disney so much smarter than me, i go home from talking to them, i say to
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my wife, i thought i was smart need my mom to say you're just as smart as rich, don't worry. costco is money in the bank. gary in alabama. >> caller: thanks for taking my call been following you for 20 years, always enjoyed that show as well made thousands of dollars on your advice. can't thank you enough for that. >> thank you, that's fabulous. >> caller: back in november we both jumped into paypal and i want to know what to do with that stuck just like you are. what do i do >> guy comes on your show, stocks 180 everything's fine, looks good, going to do fine, then you lose 100 points answer is i don't know what to say about paypal other than fact it stinks. back with cramer
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got a real controversial one, not sure i agree entirely but walk through it. you got to watch oil to understand the market. two major wars going on, worldwide, russian/ukraine and central banks versus inflation thanks in part to sanctions against russia, economically speaking a gas station with an army skyrocketed to $112 a barrel, oil value, unbelievable performance, 10% of the trust
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but where is it headed next? answer with help of garner who told us where natural gas would tap up, author of "high probability commodity trading," on the petrol complex. it's hard to predict the prices in war-time situation. volatility in the energy markets. shocking moments of illiquidity. they attempt to hedge against inflation. couple of fancy charts west texas intermediate traded in new york. one of the benchmarks for the overall price of oil and among the healthiest, least volatile energy futures in the world. lot of activity.
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american oil, insulated from geopolitical risk. nobody's going to invade texas that i know of but garner feels it's broken when the markets are functioning normally, spread of bid and ask price is penny at moment but spread came close to $1 for west texas intermediate, which is crazy. when things are more liquid, seeing dime or more spreads between the buyers willing to pay and sellers willing to sell. again, highly unusual. sign of dysfunction, and also seeing erratic price swings. go to those. weekly chart of west texas intermediate crude garner points out if you measure bull and bear mascrkets by 20% swings, a year's worth of price movement here. early were seeing 20% swings
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practically every day. it's still extreme by historical standards. russia invaded ukraine, price of west texas crude broke above its trend line ceiling of resistance it held for long time. entire market was in chaos before the war had well-defined trading range. can see that standard wedge pattern west texas breaks down, could go back potentially to the wedge if that happened. garner thinks could lead to mass liquidation that takes oil back to the '70s, that's the only thing i really fear. war situation in ukraine is uncertain but central bankers are doing their best to slow down the economics to result in demand for oil
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but could be a while before it's a problem. risk is there. high prices eventually destroy it, too. down in the rsi, a momentum indicator, it's pointing higher but nearing overbought levels. could have more upside but sees it coming back down to levels we would have seen before russia invaded ukraine, just don't know how long it will take. take this off the table, go back to the trading range, might see this if we go back that's what she's saying is the downside another reason the price has been able to soar, big oil producers have been disciplined. we have them on the show, they're not spending money on new production know it's better to leave the oil in the ground, keep the prices high and return capital to you, the shareholders this is a chart comes out once a
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week fracking changed the face of the oil market price of crude collapsed and stays under pressure for years until recently the pandemic hit, producers learned to be disciplined and price soared as you can see, steadily recovering only so much discipline oil industry can show over $100 a barrel private equity firms we can't see the full numbers approaching two-year high, anybody talking about that still low by historical standards, but more production coming on line will keep creeping higher and make a big difference. we don't know how long it will take if you saw this jump to here, going to 70, oil, keep eye on that zoom out to monthly chart of
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west texas intermediate group. prefracking and postfracking markets. upward ceiling, $120 a barrel, breached it after the invasion, but failed to close above that level monthly base and garner thinks second attempt will fail. and she's saying we're going to be stuck here. when you look at relative strength index here, that tells garner oil prices are extended and vulnerable to stiff decline if the traders are given opportunity to change course daily chart. broken out of triangle pattern lately garner could see more upside but two ceiling of resistance, 115
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and 120. and she expects wall street's focus to shift from supply constraints to the demand side i disagree, i think china is coming back on line. but at the moment, oil looks good situation in ukraine could stay crazy longer than you expect because the war was insane to begin with that's my opinion, but bottom line, charts by garner say mostly baked in. and maybe won't make money oil rallies tend to happen in blink of eye, selloffs just as quick. i'm sticking by oils, bought more last week these charts tell me i'll probably be wrong but willing to bet the other way.
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billy in indiana >> caller: boo-yah from indianapolis motor speedway. >> what's going on >> caller: got me on chevron back around 90 >> chevron great worth. >> caller: should i take a profit off the table or hang in there? >> hang in there tell you why could buy up to a quarter of the company, most forward thinking of the major -- wow what a stock. major ceos i'm a banker with mike worth understand again, the charts suggest we're getting long in the tooth with the rally selloffs can be as swift as rallies. i think the war is going on longer and we'll make more money with the oils. it's a battleground, stay with cramer. >> announcer: coming up next cramer is bringing the thunder
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fist on "mad money." mark in wisconsin. >> caller: got a company for you in the process of finalizing all cash $11 billion bid for company by name of switch. with that in mind, opinion, buy, sell, hold on digital bridge group. dbrg >> we talked about this this morning trying to figure out what to say about this we have to do more work. all i can tell you carlos in florida. >> caller: cramer. all right, gambling stocks hit hard last year wanted your opinion on penn national. >> i like draftkings more. joe in new york. >> caller: hi, thanks for taking my call. longtime viewer, second-time caller >> okay. >> caller: calling on grow
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more positive day for the market, a dow component done all right this year and still feels underappreciated caterpillar, heavy machinery kingpin i like so much delivered magnificent results but issued conservative, qualitative guidance, hasn't gone up as much as i would like. day in three years management announced $15 billion buy back no wonder the stock jumped check in with jim umpleby, chairman and ceo welcome back to "mad money." >> great to see you. >> one of the most impressive analyst days i've ever had the ability to watch going to go to the pages i think are amazing out of so many good
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ones -- the energy transition is significant opportunity for profitable growth. people don't realize all the electric vehicles, anything that's renewable energy, all starts with caterpillar. >> thank you, jim. we are very excited about it and do think the energy transition expands our total addressable market thinking about all the minerals that need to get mined to produce it, it's exciting. all of the projections by the automakers of evs built, has to be good for cat. we're excited. >> when i look at it, if i were a major auto company and wanted to avoid what happened to semiconductors, would call you, i need hundreds, are they calling you? we need machines >> we deal with mining customers who produce the products used by the auto manufacturers
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but certainly we have seen capital discipline from mining companies last few years, interest is increasing sales of them is increasing and we're focused on helping them achieve the climate related objectives as well lot of good conversations and we believe the demand will continue to increase. >> and when you have a cat, it lasts pretty much longer than you ever can and your services growth through machine life cycle, explain how you can have $15 billion buy back, no sweat this is remarkable relationship that people have with their machines. >> it is really is and established a target to double services revenue 20216 ad 2026 customers own for a long time. gas turbines run for 60 years
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and we help customers, overhaul them, get them in production and have mining trucks rebuilt many times as well. again it's a great opportunity for us one of the things we've done is invest in technology to help our customers lower life cycle cost and extend the life of the products over 1.2 million connected as recesses, processes. we can minimize downtime with the view of making customers successful. >> you heard about gasoline, but electification of the entire portfolio is one of the most amazing things you're doing. >> we believe the adoption of alternative drive drains will vary by geography and application but we're investing in variety of alternative technologies to help our customers achieve the carbon reduction targets. >> many people say without china
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caterpillar has nothing. when i went through everything, doesn't even mention china, it's not as big of a market as people think, is it? >> 5% to 10% of total sales depending on the year. it's hydraulic excavators. sales would have been higher if not for supply chain constraints but team increased sales more than 20% in 2021 despite the supply chain challenges and first quarter we turned in double digit sales growth. demand is strong and continuing to work through the constraints. >> we've been emphasizing companies that make stuff, do
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things, reasonable stock price and give back in dividends and buyback. you're giving back 101% of your free cash flow to shareholders through dividends, this is precisely what i'm telling people to be in. how are you capable of doing that >> thank you, jim. we've worked hard on capital discipline within our company, tightened up operational execution last five years and did produce $14 billion of free cash flow for machinery, transp transportation over last three years and returned to the shareholders allocate resources to the best opportunities for future profitable growth, are growing the business and returning cash to the shareholders. >> always been a huge fan but wanted this level of discipline. how did you get buy-in of people
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to make it so you just didn't go flat-out every minute whether we needed machines or not >> i'm proud of the team done a great job part of the strategy we introduced five years ago, one is operational excellence -- safety, quality, lead, flexible cost structure we need to perform up when the market is strong and when the market is weaker in 2020 because of covid, sales dropped more than 20% but met adjusted operating profit targets regardless that demonstrated i believe to investors we can meet commitments for margin targets when the market is strong and in covid induced downturn we still pulled it off. very proud of the team. >> carbon capture for real or always uneconomic? >> i think it's for real
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we'll see how long it takes to play out but we made acquisition recently, carbon point, to help customers with that issue. i think that's something that will occur at different rates with different products and different parts of the world but it's real in the future. >> i know i hear elon musk speak, obviously brilliant, said we need all the lithium in the world. do we get lithium out of the ground with caterpillar? >> of course all of the things that go into evs, we produce the products that allow our mining customers to get the min ralz. i'm a big fan of elon musk we're focused on satisfying that demand >> always been a great company, no dispersions, but made it a great company and stock. jim umpleby, what a great show
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today, sir fabulous >> great to see you, jim thank you. >> i like to say there's always a bull market somewhere and i promise to find it for you right here at "mad money. i'm jim cramer see you tomorrow "the news with shepard smith" starts now . primary election day across five states including a trump test in battleground, pennsylvania i'm shepard smith. thi this is the news on cnbc. president biden speaks to murder victims' families in buffalo. >> hate will not prevail white supremacy will not have the last word. >> his call to action and the latest on the investigation of the massacre at the supermarket. mariupol falls to the russians now hundreds of ukrainian soldiers from the steel plant are in enemy custody mariupol aside, the fighting

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