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tv   Mad Money  CNBC  November 12, 2013 11:00pm-12:01am EST

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> 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. my job is not just to entertain you, but to teach and coach you so call me at 1-800-743-cnbc. my co-hosts were truly spot on this morning asking me about when is enough enough.
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how can the market keep climbing and why everyone has such a good return. the nasdaq sank and the nasdaq finished flat. when does prudence dictate ringing the register and going home -- >> house of pleasure. >> to the house of pleasure. welcome to the intersection of money management and valuation. first, i can tell you what we used to do at my old hedge fund. if we came into november well ahead of the averages when they were up as nicely as they are this year, it was, as they say a no-brainer. we'd sell everything. >> sell, sell, sell, sell, sell, sell! >> except half a dozen no-liquid banks, the ones we had high exposure with and couldn't get out of and we would trade every day from a standing start. >> buy, buy, buy, buy! >> literally day trade and we'd start from scratch putting money
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in and taking money out at the bell. yes, we knew where our money was. in the bank! sometimes it would keep us tormented by watching the stocks and doing nothing. i went to a lot of movies back then. i think i must have seen shawshank, the fugitive and braveheart ten times each. they saved me a fortune. kept my mind off the market. i used to take many a friday off and go hiking and we moved back there for the last two months of the year so we would not look at the market. yeah. we did anything we could to not screw up a good year, forcing ourselves not to invest. what was the point? we had won. i'm big into declaring victories and we are the w. if the averages kept going higher, they could make money in the day trading thing and keep us from falling too far behind in the month and we always wanted to keep our hand so we weren't totally blind sided, and at this point of the year i could remember watching stocks
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because i knew there were good ones and it disciplined trump's conviction and we couldn't give back our gains no matter what. we couldn't risk it and we never did, ever. but then there were other times, darker times, times when my fund was behind the market, the market was screaming like this year and we were staring down the december 31 gun barrel every single day of the week. our thesis was pretty simple. it's really difficult to make money in a rising stock market without being all in, at least 100% invested. notice i said at least and if we wanted to trump a rising stock you had to be marching to the hill or use call options, and you simply couldn't afford to sell. hear what i'm saying? remember that phrase, you couldn't afford to sell, that's what carl and david and i were chatting about this morning, the notion that as dangerous as it is to stay invested when the tape is extended, and if you're a money manager it's even more dangerous to your franchise to be underinvested and it's a risk
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reward when you think about it. i know it's a hard concept. you can only think of one kind of prudence at home, the kind that says you're buying stocks all the way up here? are you kidding me? are you seriously using the price break from an ugly story to buy a stock that's up 76%? do you think it's time to buy home depot simply because america's home builder has knocked down on a huge cancellation number and the drop-off in orders? it even reached for restoration hardware which has climbed back from the depths and honestly, are you contemplating buying fedex from the downgrade after the 44 points that it has run? of course, the last one's very funny because the answer would be yes given the fact that dan lobe revealed a position in it today. the answer to your questions if you're a money manager, yes, you have to buy. it's imperative that i have exposure to the stock market and i have to buy it at a discount is what i would say. fund managers don't say oh, my, fedex is so high. they think downgrade, here's my
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chance, and without paying up from yesterday. ironically in a lot of cases you do have the terrific chain and so that is a little bit of an anomaly. yes, lobe got loud after he got long. here's what you have to ask, are the professionals right to behave this way? i mean, you're an amateur at home, would you ever do anything like this? i think you have to look at it from the point of view of the professional. if you're running a fund that's underperforming the averages you will lose assets to other managers who did better than you next year. you may have loyal patrons, but if you have hot money and you finished in the bottom quartile of the performance log, you will take a serious pay cut next year, plus you can't market a fund that doesn't beat the averages, even if people do hedge to protect yourself. of course, there are always people who will look at your fund's long-term record and decide you're worth keeping. i mean, those are people who say that guy was in the super bowl four years ago, so keep him around even though we got a lot
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of l's and one time of year comes and he doesn't have enough w's and then he's gone. for every one of the people who stays after you underperformance, there might be two people who want to go with somebody who is better than you. you don't say whose short-term record is better, but who is better than you. so the calculus makes sense. they are likely to beat the averages over the next month and a half because it's essential for them to be able to beat that market. take priceline. here is a stock that will be anointed right into next year because it just reported an excellent quarter and it is cheap versus the growth rate. priceline is regarded as the quintessential growth stock and the professionals wait until it's down and then they buy some. they don't even question the buy, let's get into priceline because it's lower than yesterday. there's a whole list of anointed names and these are the names these money managers who are desperate and this is what they're buying. they buy google. they buy salesforce. they buy amazon and they'll buy netflix and starbucks tomorrow
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after this arbitration case where kraft won. they'll be hand over fist buying starbucks. those will be my go-to names and these will be highly concentrated bets, people, where i literally was wagering and i like to use that term, wagering that my fund could catch and then pass the market. the airline stocks with u.s. airways settlement, that group will go up again tomorrow and the next day, i would take down some delta. whatever has beta, meaning the thing that can jump around because you can't beat the market with a stock like a clorox or general mills. it ain't going to get you there. how about the down side? it wasn't really in the game plan, by concentrating the holdings in these high beta stocks i would be vulnerable to the sudden downturn and that's why i used in the deep in the money call options. you can see it in my last book, getting back to even. that allows me to be able to be stocked out of priceline and i
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would sell the short common stock and be able to hedge in a rapid fashion. all the while praying for a down turn. like many managers who think the market is too high, they need that downturn so they can catch up to the averages. as a hedge fund manager i could never leave that to chance. there was too much on the line, and notice not once in this whole calculus i just gave you was value considered. it was completely irrelevant when you're on the hunt for performance. if you're running a fund, the idea is to mimic the investors who you figure will get the most money in and the guys that will put their money into the market. it doesn't even matter if you like these stocks. most of the time i didn't. they're simply vehicles chasing performance for performance sake. the only thing these managers care about is that these companies have already reported so they can't blow up. priceline is so darn valuable. it can't pre-announce a number and the analyst can't reiterate the buys and they can't turn around and sell. if you were up a lot at your
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hedge fund, you would sell even stocks you liked, and if you were down below the benchmarks you would buy things you didn't like? here's what i have to say, it happens every day. i'm just the only guy willing to admit it. there are people that buy them as a class. i like priceline as an uber member of the growth class. other chartists, right? talk about them every tuesday. they don't care what the stock is. for them, the whole company is an abstraction. here's the bottom line. as we move into the homestretch we need to beat or catch up to the averages and it is on the only thing on the minds of money managers and particularly hedge funds, even allowed on air. i only know myself because i've done it, and i've been there, both covering hedge funds as a broker and that means selling into them and running one myself so do not be so naive. this kind of logic is what goes on every day and it will control
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the market at the end of the year. you know why? because it always does. let's go to dave in california, please. dave? >> jim, a west coast boo-yah from dave in san diego. >> i'm loving that. what's going on? >> my question is about a 3d biotech company that is building -- sorry, building human living tissue models symbol onvo, with the heavy volume and reaffirming its milestones, is it still a good buy? >> you know, this is the kind of stock that i think right now is a little dicey. now why do i say that? because we were very scared of a stock that initially we liked, which was serepta. it had all of these things with muscular dystrophy, and a few weeks ago in the sell block we slapped all of these high-risk names into the sell block. what happened? it was down $23 to $13. i don't want to be on onvo other than a long-term spec, because it's too dangerous right now. it's just too dangerous. how about steve in california. >> boo-yah, jim from sunny sacramento, california. >> what's up?
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>> bank of america, my son told me to buy it two and a half years ago at $14 and i watched it go all of the way down to $3. what should i do with it now? >> bank of america's fine, you know? it's neither here nor there. it's not like a 3d printer and not like a biotech. it's just a bank and the bank's with the yield curve. if interest rates go up a little bit it will make more money. frankly, it's an okay stock. i can't pound the table on it either way. i'm not going to tell you to sell it. i'm not going tell you to buy it. i know. that's the equivalent of neutral, but i'm neutral on it. the year's winding down and the big guy's got to catch up where they've got to be. it's the end of the story. "mad money" will be right back. coming up, crude conundrum. black gold's been on a slide, but tonight cramer's drilling down on a few oily names to extract a clear view of where they could be headed next when he heads "off the charts." and later, up, up and away?
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in-flight internet provider gogo took off in trading yesterday, soaring over 30% so far this week. is there still time for you to grab a ticket, or are there friendlier skies elsewhere? plus, hunger gains? all week, cramer's sampling a menu of stories that may serve up serious returns. tonight, del friscos has been sizzling since its wall street debut last year, but with only 37 locations is it something you can sink your teeth into? don't miss his exclusive with its ceo all coming up on "mad money." don't miss a second of "mad money," follow @jimcramer on twitter. have a question? tweet cramer #madtweets. send jim an email to or give us a call at 1-800-743-cnbc. miss something?
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head to
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with the price of oil
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getting positively poleaxed, falling to $93 today, down more -- more than a straight line, could this be on -- are you ready -- the time to circle back to the natural resource stocks and start buying them? today we're going off the charts to answer that question with the brilliant technician, founder of and my colleague at captaining a good trifecta product, and while the price of crude has been sliding lower, lang points out that the actual oil stocks have shown tremendous relative strength versus the 16% decline in the underlying commodity since the summer. this unexpected strength is a big reason why lang believes the moment has come to to buy the best stocks out there. this is counterintuitive. he wants to buy the ones with the strongest stocks and based on his track record we have to listen. lang says he's not coming to an end. he's calling the bottom.
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his favorite natural resource names i almost feel like i should save it because they're so bizarre. and tesoro, and the mineral supplier and tesoro, the old shale corporation, tesoro? man, the oil refiner. man, these are down and out. that one at least i can get my arms around because the stock's owned by our charitable trust and we're doing that because of a critical restructuring. take a look at nov's daily chart. the first thing that screams out to lang from this picture is the moving average convergence divergence line near the bottom, which helps chartists detect changes in the trajectory. just the other day the macd flashed a big, fat buy signal. you know what that is? you know what that is? that's a bullish crossover where the black line goes above the red line. just a second. yep!
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absolutely, and we've had a ton of success with this indicator on off the charts lately. it's the closest thing you can get to a green light telling you to buy. the last time you had a bullish crossover and you caught a quick gain of 8 points. it has been going strong ever since we got one of those important crossovers back in july, and you know what this was, this was the so-called golden cross when the 50-day moving average goes above the 200-day moving average. that move seems to be accelerating when it is seeing expanding volume on the days that it goes higher. expanded volume and that is a sign of positive bullishness, that's big institutions taking a position in the name, plus nov has just filled in the gap when it reported late last month. and if you're worried about down side, lang points out that this
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$82 and change stock has a strong floor of support at 79. so a limited down side, va, va, va voom, upside. definitely. so you have three points of a potential down side with national oil well varco. for that we have to go to the weekly chart. here we are with the macd and the williams percentage r oscillator developed by a commodity trader named larry williams that can tell you whether a stock has become overbought or oversold. this is what we would call embedded overbought. it's not like embedded journalists in divisions. this is embedded overbought. normally overbought means that a stock has come up too far, too fast and is due to get slammed, but when it is overbought and stays that way, technicians say it is embedded, meaning the move higher can go a long time before it peters out. lang sees national oilwell varco, are you red for this one? the fabulous cup and handle
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formation! not kidding. this one works. it's the one that looks like a little tea cup with the handle on the right side, and it's the most reliably bullish pattern and national oilwell varco could be on his way up. he's using a $100 price target. candidly i've been worried about my charitable trust because of the big decline in oil, but i have to admit after this exercise i feel a heck of a lot better and the charitable trust will buy more if it goes down more. that's a little yellow dot that usually means that. that's mcdonald's, sorry. how about cliff's? that's the whipping boy for years, but lately over the last four months, this thing has come back with a vengeance. so many of you liked this. you always call me on it. let's start with cls daily chart
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because lang says this is his favorite chart of the bunch. i think he's a wild bunch. he was trading at $20 last month. a tremendous lift, rising 26 and change and that's after the stock got knocked down. a buck in today's session. today i was, like, lang, they're crushing this thing. you don't believe in it, do you? not only that, but the volume is like a polygraph, when it's sky high it tells you that the move is telling the truth. the pattern that set up a multi month rally, guess what? cliffs natural has a couple going from a weeks ago and that's when the 50-day moving average crosses above the 200-day moving average which signals it may have a lot of room to run. it's in the last stages making the down trending handle and as soon as that handle is finished lang says that clf will break out, possibly to much higher levels because that's what the history of these cup and handles
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moves inspire -- much higher levels. man, i hated this thing. i have to open my eyes. and then there's more. the moving average convergence divergence line, the old mac d, it has made a bullish crossover in october. this is the classic buy signal, and it is very much still on for natural and lang says there has been heavy option buying in clf as of late and it puts on a lot of the shows on the network that tell you that's bullish. in other words, people are bullish if this stock goes higher. take a gander at cliffs weekly chart, because there is one extremely important pattern. cliffs natural has now made what is known as, oh, boy, holy cow, an inverse head and shoulders pattern, which looks like not an upside down bottle of shampoo, stupid. but an upside down person and specifically a head dangling between two shoulders. see? well, i was trying to make a smiley face. just like the cup and handle
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that we talked about before, this is a super bullish formation and based on this pattern, lang can see cliffs natural resources rally to $45 and a gain of 70% from where it is right now. that would be a very big change and a change that the fundamentals of coal and iron ore better get better, and i have not been a big fan of this one and lang's forcing me to be more bullish. last, but not least, here is tesoro. it just broke out of a cup and handle pattern and it could be standing upside and hence why the stock rallied. the stock has been building a base here and he's using that base as a launching pad to higher levels and it just broke out of its 200-day moving average. that's a big neon sign saying the stock is ready to run. you have clear sailing all of the way up to $58 which is where it could hit the resistance. yet, was there a bullish mac d crossover and that's another
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super bullish sign for lang. the refiners started coming back from the auction squeeze. the price of the revived product, but that's because the price at the gas pump would be in the relentless decline in oil. that was with they were ready right here, right now. tesoro and langs's favorite cliffs nat. i haven't liked tesoro or cliffs, after these charts i am not inclined to buy them, but i sure wouldn't short them either. stay with cramer. coming up, up, up and away? in-flight internet provider gogo took off in trading yesterday, soaring over 30% so far this week. is there still time for you to grab a ticket or are there friendlier skies elsewhere?
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in the wake of twitter's explosive but now looking like a dud initial public offering last week, we've been hearing chatter that it's been overheated and people are massively overpaying
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for all sorts of merchandise. this kind of talk is why i don't like to make generalizations at least when it comes to stocks. the truth is you need to evaluate the stocks on a case by case-basis. no doubt about it, particularly in biotech, but you can still find terrific opportunities in loser ipos that fizzled on their first day of trading. in short, we are looking for the next lifelock, the identity protection service that came public in a pretty dismal deal and was quickly written off by wall street, only to turn around and come roaring back later on. so tonight i'll tell you about another fresh-faced ipo with a disappointing debut that has transformed into a turbo charged growth stock with even better numbers and growth prospects, and when it pulls back you'll want to buy it. i'm talking about gogo. the company that you might recognize the last time you were on the airplane. they're the guys that give you wi-fi at 30,000 feet in the air if you're willing to pony up $9.95 to connect to your laptop or $4.95 for your mobile devices.
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and 30 minutes of access, but that's the whole point people. when you're stuck on the seat in the airplane you can't walk down the block to the starbucks for free wireless access. if you want wi-fi you have no choice but to pay their price. the faa ruled that people can use their electronic devices throughout the whole flight, which dramatically expands the scale of the opportunity for these guys. gogo ceo said and i quote, we think it's a fundamental to the business and we're bringing the mobile internet age to aircraft, and that's just one more of tailwinds and social, mobile and the cloud. these are the trilogy. everyone's got one, we like it. as you can tell from the market's reaction, it was a huge surprise. why was this quarter so shocking? because when gogo came public on june 20th the deal was a total flop. the gogo price was $17 and it opened down a buck at $16. loser! and that's also where it closed
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the first day of trading, down 6% from the ipo. it you got in that deal you were burned! gogo was written off by wall street and the stock dropped as low as $11 in september. >> the house of pain! >> -- before bottoming. and then beginning what now looks like a relentless march higher from 11. as of today gogo is giving you a remarkable 56% gain in the after market, and that's over the course of less than five months. i'm trying to fight a sneeze. it's better to fight it than to sneeze. this was an ipo that fizzled and if you bought into the post deal weakness, you have now made a killing, which is why i am telling you that some of the best ipos are the ones that are overlooked and some of the worst are the ones that are red hot on day one and then get clocked. of which twitter, down eight from its high, is definitely looking like. remember, twitter's only good if you got in on the deal, not on the opening, which is why i was so adamant to the point of
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angering many people on twitter that twitter the stock was a -- sell, sell, sell! >> not a -- >> buy, buy, buy! >> i can't in good conscience recommend the stock at these levels. that's not why i'm bringing it to your attention. this stock does have a terrific long-term story. so why did it fizzle then, if it's so exciting? how has the stock managed to go from simply road kill to simply killing it? first of all, gogo has a voracious need for capital to keep building out its network, so right out of the gate there were many concerns about funding for the gogo. since then, it got an additional credit facility and it is unlikely that they'll raise more cash, but if they happen to do a secondary. which i would do if i were you, gogo, then i want you to be able to jump all over on any weakness that creates. i would wait for the potential secondary for buying once the stock goes down to where it was before it reported, say back to
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$20 instead of the close today. worries that i think were overgrown and gogo was the best in-flight provider out there. it would be expensive for the airlines to modify their planes. they're more flush and continue to be one of my favorite groups, and us airways can negotiate that deal and i don't think they'll throw money around which brings me to why this company has been able to turn things around and become such a terrific performer. gogo is as close as you can come to a monopoly without attracting the wrath of the justice department. of the ten domestic airlines equipped with wi-fi, gogo serves nine of them, including delta, us airways and american. the company has 80% of the rapidly growing market and they have a 90% market share. gogo actually owns all of the electromagnetic specs designated from air to ground use in this
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country. they relied exclusively on satellites which are much more costly and gogo is moving beyond wi-fi. the company is rolling out in-flight entertainment services which should be available in 150 planes by the end of the year. i hope it's one that i'm on next week and on all flights in 2014. they plan to launch in-flight voice and texting services. this is a tremendous growth service, people and the market didn't recognize it. i didn't recognize it. the airline know people will pay more for flights if there's onboard wi-fi, so they're eager for what gogo's selling. and because gogo has a ten-year contract the company has a terrific visibility, meaning it can clearly see how much money it can make down the road. that's the kind of situation i love. gogo is re-investing its cash back from the growth and that growth could be truly incredible as they start to expand internationally with the competitions minimal including the number of aircrafts by a factor of five. plus management can boost the
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revenue fivefold, as well. out of a total addressable market of 20,000. no wonder gogo just blew away the numbers. they were up 48% this year. they saw a 21% increase on take rate that connects to gogo's wi-fi, and an 8% increase for revenue possession. they launched a new ground to orbit initiative. that could make gogo's in-flight wi-fi 20 times faster, but here's the rub. gogo was at 28.8% yesterday. todays right. 28.8% higher. if you buy it you're chasing. we do not chase on "mad money" especially with the stock trading five times next year sales. i believe a secondary is what the company should do, so i'm setting you up for that. here's the bottom line, don't let all of the smoking hot sexy ipos distract you from the ipo
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flops that could turn out to be the biggest winners in the after market and you can buy them, unlike twitter that would probably shut you out. stocks like gogo which was written off and came back from the dead and while i don't want you buying up here, it's worth picking some off the next time we get a marketwide sell-off where it gets back to near where it was when it reported that magnificent quarter. eric in new york. eric? >> hey, jim, eric from new york. i'm currently at quinnipiac university business school. >> excellent. >> my roommate sam and i watch your show every night. we love you. >> yes, i love that! college kids, they love the show. what's up? >> anyway, my question is about diva systems, it's an ipo that came out last month. i was able to invest on the ipo date and it did real well on the first day out. ever since then it's been all over the place. i want to know what you think about it. >> it's cloud based. despite the fact that racks did not do a good number, i still think the cloud -- racks is a
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company that does hosting -- i think the cloud play is a good of which you're in a good one. i want to know more about it, but you're in a good one. can i go to jude in my home state of new jersey. jude? >> hi, jim, how are you? >> real good. how are you? >> good. i have a quick question. i invested in empire realty trust. is that a good investment? >> i was going over the initiations today and they just started initiating on it, and i'm not going to say it is, you know why? because the real estate investment trusts i recommend are huge growth vehicles, and that does not have the kind of growth i want. if you take a look at aventas which is all of the way down to the 52-week low that's got the kind of growth i want. fasten your seat belts. you will need them in the smoking hot ipo ride. there's plenty of turbulence. my job is to steer clear of the expensive ones and to find the ones that flopped like gogo. i promise to bring these to your attention before they occur, but this was just too juicy not to highlight. stay with cramer. tomorrow, kick off the trading day with "squawk on the
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street," live from post nine at the nyse. >> i know, some keep telling me on twitter, i hate you, jim cramer. do i buy fannie? >> it all starts at 9:00 a.m. eastern. ♪ ♪ so you can get out of your element.
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it is time -- it is time for the lightning round on cramer's mad money. rapid fire calls. buy, buy, buy, sell, sell, sell -- and play until we hear this sound and then the lightning round is over. are you ready skee-daddy? start with ruth in new york. ruth? >> hey, jim, this is ruth, i'm calling from old forge, new york. >> love that up there. what's up? >> we've got snow up here. >> oh, yay! >> my question is exelon -- >> no, no, no. we don't need underperforming utilities, and we'll also put in a caveat because we don't like first energy right now either. let's go to mike in big missouri. >> missouri boo-yah. >> mike, mike, mike, boo-yah back to you. what's up? >> what can you tell me about philip morris? ticker pm.
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>> let me just be clear because that's philip morris international that you are asking about, and philip morris international is a very inexpensive stock because they do not regulate tobacco overseas as tightly as they do here, and they're still smoking it. they don't seem to care. they're smoking their darn fool heads off. let's go to jeff in georgia. jeff? >> the short term, long term, buy, sell, and on the road to a billion even after the investigation overseas. what are you thinking? >> what stock? lumber liquidators. holy cow! you know that's one of my absolute favorites. lumber liquidators, tractor supply and ultra salon, three keys to this stock market. let's go to todd in north carolina. todd? >> hey, jim. it's todd from carey, north carolina, a big boo-yah to you. >> completely. what's up? >> fedex. i've been holding for five years. >> you want to hold it, why?
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it's an incredibly well-run company and it's up on a spike today. yes, let it come in and then you can buy even more. that's what i like about it. let's go to quentin in new york. quentin? >> jim, thanks for having me on. your staff is great. >> they're brilliant. i am a puppet, i am a marionette. >> the stock i want to know about is cree. they have, i think, too high multiples. >> cree is too hard, man! that thing is all over the map. you mess up and you're hurt and i don't want to mess up and hurt people. and that, ladies and gentlemen, is the conclusion of the lightning round. >> the lightning round is sponsored by td ameritrade. coming up, "hunger gains." all week cramer is sampling a menu of stories that may serve up serious returns. tonight del frisco's has been
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sizzling since its wall street debut last year, but with only 37 locations, is its growth something you can sink your teeth into? don't miss his exclusive with don't miss his exclusive with its ceo. then expanded?
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in anticipation of the new
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hunger games movie, all this week we're talking about hunger gains, the food stocks that are poised to be outperformers for 2014. tonight we're taking a look at how the other half eats, the rich half, del frisco's, they have 37 mostly high end restaurants. this is the kind of place where rookie nfl players should be pick up dinner for their elders if they had any taste. but the reason i like the stock so much is because i love eating there and it is up 44% since a year ago. it has 37 locations and the company is increasing the store count by 17% this year, and they can have a footprint of 140 to 165 stores, four times bigger than it is at the moment. some people felt it was disappointing. over the last few weeks the stock's come roaring back and i think it's beginning a very big run. let's check in with mark.
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he's the ceo of del frisco's restaurant group to learn about his restaurant and where it is headed. thank you for being on "mad money." >> thank you for having me. >> thank you for coming. it's a total treat to eat at your place. is america wealthy enough to have as many as you'd like? >> it's not just if we are wealthy enough, it's if you want to have a good time. the affluent is doing well and the upper middle class splurge. there's always room for indulgence in this country. >> how does it look? is it back the way the corporations were expanding? >> you know what? i don't think it will ever go back to 2007, but it's pretty close, jim. it's pretty close. >> each year a little better as we put that past behind us? >> one of the things that distinguishes us from that of most steakhouses is that we don't cater just to the business
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clientele. most steak houses don't have 80% of the business. we're just under 50. so people, aspirational, leisure diners choose us and that's very important to our success. >> okay, now, how many of those, given the way it's set up, could you have in new york and philadelphia. philadelphia you came out from philadelphia and you opened up a del frisco is where we do business in new york. how many cities can maintain a del frisco's? >> we have ten today, but think about it, we're with not in san francisco, miami, l.a. and d.c., we're going next year, by the way. >> the fact that you're not in miami, you can rival them. >> that's right. we look forward to that day. they're great operators. we can double the size, absolutely over the next ten years, just in the del frisco's double eagle brand. >> grill is a concept that you can put up 50. >> we think the numbers could double that, and if you look at
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when we've done with it, every one we've opened has blown the door off of our initial performer. we've gone into three cities where we currently have a del frisco's and absolutely no cannibalization. >> that's a sign they know you have more room. one that i like, and frankly i had thanksgiving dinner there not that long ago, was sullivan's and when i look at the numbers for sullivan's it's clearly been an anchor keeping you guys down. i know you may change the menu in the fall. you've got that autumn/winter menu going on and you've done remodeling in chicago and why bother, man. you guys are on fire away from sullivan's. >> the 19 units has been tremendous over all of these years and a setback here. to be honest and frank, we took our eye off the ball a little. we needed innovation in food which we put in and we needed the remodels and it's all coming. we believe that we can separate our infrastructure, take care of
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sullivan's and bring it back to where it needs to be. the most important thing we're doing is keep our eye on the ball with del frisco's and the grill. >> if you close it does the stock go to 25? >> no. listen, out of 19 stores almost all of them generate significant cash flow. >> okay. that's what matters and why close them? >> why close them? >> we're not taking our eye off the ball of growth. we're a growth company. we have the teammates put in place to grow this grill and grow it quickly. >> full disclosure, your general manager of new york is amazing. i don't know your manager in philadelphia, but i should because the place is well run. how do you replicate that, your general manager who remembers my drink after four years? how is that possible? you cannot possibly have that number of people around the country that can do that good a job. >> well, the new york general manager scott gold, amazing, but all of them, jim, that's the key in our business, is the general manager. we have industry-leading health benefits, pay, the whole thing, we keep them. they just don't go anywhere.
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they're all good. >> where else would they go? >> why would they leave? >> that's a very good point. >> now you know the sullivan's story, which is all these guys want to talk about. i want to talk about the highest growth and best square footage and the largest amount of money that could be made in the restaurant group. this is not a $400 million company, it should be a billion dollar company. stay with cramer.
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you can feel the collective shudder when whole foods, the best supermarket operator in the world, cut its forecast last week. all of the stocks in the group instantaneously reacted as though the natural and organic move had peaked. the super hot industry was on its heels and it was flattering and it was a disaster and they trend no worse and it's not a fad. it's sell, sell, sell. a few days have gone by and we're beginning to realize it was the exact wrong takeaway. that's because the organic category isn't peaking. it is flooding, meaning every register is selling natural and organic if there is a problem at all. as the ceo of costco told me, natural and organic, which was perceived to be a fad at one point is here to stay. it's growing rapidly and everyone including costco, which has a gigantic food business, has had to adjust to the tsunami. that's right, the tsunami that's overtaken the food chain.
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it's not just costco, it's kroger and target. even growth stores. that competition is not good for whole foods, which admitted that cannibalization issue. the company is too good an operator not to figure it out, but the competition is here to stay, in part because sprouts, fairway, and the costcos and targets and krogers and the trader joes of the world have too much at stake not to stake claim to the natural and organic product aisles. gone are the days when you could ask for rice cakes at a walmart, as i did with my daughter in north adams, massachusetts, five years ago and be sent to an aisle of rice crispy bars, the land of bazillion calories. in all of what happens, these market share warriors are on the losing end of the movement and i can think of three clear-cut winners and you will understand that the first and most obvious is hain celestial. the most aggressive worldwide player and you have to read the last conference call.
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irwin simon is buying everything. he and he alone recognizes this is an exquisite moment for the industry. this is the true land grab. he's the only one that knows it. every register at every retailer must need natural and organic merchandise to sell. second is white wave. saw him yesterday on the show. here's a company that sells plant-based drinks. people like plants. they either don't trust the food chain or they don't want the calories that anything bovine-derived is going to give you. plants are fresher than old cows. almond is safer than dead meat. finally, there's clark's. people ask how can clark's be worth 90 bucks a share. consistency and big dividends matter. clark's is burt's bees. we're paying too much for a
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property that seems more like hype than numbers. this is taking drugstores with many different units and lots of different aisles faster than any other brand i can recall. hain, clorox, they're the winners in the world, giving something that's natural and organic. i'll bet they turn out to be cheap in the out years, because of this long-term trend that is very much here to stay. stick with cramer.
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yes, starbucks got hit with this arbitration thing. maybe that's just the opportunity you need to get into this incredibly high-quality stock, because i couldn't find any other. there's always a bull market somewhere. i'm jim cramer and i will see you tomorrow! seam. >> that thing's shot. >> [bleep] >> i'm seeing a loss of dollars. oh, that's badass. >> that's beyond badass. and it looks beyond expensive. >> you're like $1,000 away from buying a badass car. >> and you're $1,000 away from selling a badass car. [thunder claps] >> there is this huge storm coming. >> i did not need this today. with the rain falling, our cars are stuck out here. if it floods, man, i'm gonna be out almost 100 grand. [bleep] my name is jeff allen. i buy, fix, and flip cars. but i don't do it alone. i've got perry...


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