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tv   Mad Money  CNBC  January 16, 2019 6:00pm-7:00pm EST

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>> yes. >> ten-year anniversary? >> yes. >> can i come to the show? >> sure. open invitation. >> i think gold is sneaky as well, abx. >> that does it for us thanks for watching. see you back here tomorrow at 5:00 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 cramer america. i'm just trying to make you some money. my job is not just to entertain but to educate you call me at 1-800-743-cnbc. maybe, just maybe this market is going into bob dylan mode, maybe the slow ones now will later be fast, and the orders rapidly fading because the times, they are a changing
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why do i say that? some of it's the average dow gaining 142 points, nasdaq 1.5%, but mostly it's about the banks. yeah, the banks. when you look at this incredible nine-day run in the financial stocks there's really only one way to interpret it. the banks are leading this market charge out of the bear den abyss, yes the banks are the leaders. what else can you say about g d goldman sachs which just rocketed up 17 points. one day 17 points, no takeover earnings how else can you fathom today's run in the bank of america truly superior numbers these moves today come on top of the huge reversals of jpmorgan and citigroup which both saw their stocks rally after some initial plummeting on their headline reports overall, the big banks are painting a stunning picture.
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>> house after pleasure. >> -- house of pleasure. >> now, i don't want to pin everything on these earnings these stocks got outrageously sold in the fourth quarter, bear market citigroup, it plunged from $74 last september to 48 at its lowest tell me that's not a bear market now it's rebounded up since 56 this week. jpmorgan is back to 102. it was down 3 bucks before the market started started trading, and it rallied. bank of america its stock plummeted from $31 at the end of september to $22 at its december lows after today bank of america is back up to 28. best for last, goldman sachs was at $234 at its highest in november the stock crashed to 151 even today gold man is well off its highs trading at 197 what's going on here investors i think have started to realize that the banks are literally, not figuratively, but
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literally making more money than ever and they're doing so with less risk and fewer employees, as technology has replaced white collar jobs. it's consumer banking app has had 1.5 billion log-ins in the fourth quarter alone 27% of all consumer sales are through digital. meanwhile, bank of america's voice digital system erica has captured 4.8 million users in one year, something i didn't believe was possible when we spoke to michelle moore right here last may. i find that extraordinary. the digital customer is more profitable for the bank than brick and mortar ones. it's a virtual circle. it's why they're so happy to oblige you with online experience they don't want to have to pay for real estate and tellers and of course paper processing costs. at first i assumed that bank of america had become the millennials bank everyone's banking on this, i get it, right? but it's bigger than that.
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everyone with an iphone is a potential customer for their digital vision that's a large audience, right as i see it, this is a growth company that's masquerading as a boring bank. you heard it here first. i know nobody else is thinking that way that's the way you're going to start thinking as these next quarters roll out. how about a really hated company, how about goldman sachs. some of today's strength reflects what i've been saying for a while. the banks should never have been so low in the first place. between the scandal of unfa t l unfathomable proportions in malaysia, at its lows, this thing was cheaper than copper companies and steel mills. it's still even in some ways cheaper than a bunch of stocks that i like -- no name stocks that i can't believe that -- i've got it tell you this has been a very painful period i always think how the mighty or at least the mighty stock has
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fallen it's goldman sachs but i keep telling you it was too cheap. i stuck with that. you can file one by joining the -- and told finally at last we were vindicated not that we're making any money, but at least it came back to life when this thing was in the 160s, i was crying man it was like when alshon didn't get the pass from -- after the conference call i now feel like the malaysia scandal is fathomable as much as they can given the justice department's involvement, it was the first time i found it sincere. i thought it made sense. i thought it was real. the trading slowdown is no longer as relevant for goldman 61% of its revenue come from fees up from 48% in 2013 it's becoming more like a bank i can hear you say it, that's great, jim, thanks for nothing tell us what's going to happen next listen, i wouldn't be talking all about these boring stocks if i thought they weren't done going higher i bet this is just the beginning.
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why? first, i just told you where these stocks came from, and even after the recent moves, the banks are still well below their highs. i gave you those highs the group got obliterated when jay powell started talking about the need for many more rate hikes. that plan is dead in the water, and the banks can rebound. wait a second, weren't banks supposed to benefit from higher interest rates wasn't that the chatter for years? don't they make more money off your deposits when the fed tightens a very funny interview with jamie dimon where he jokes about that it turns out the answer is no. the fed was about to cause what's known as an inverted yield kurcurve where short-term rates are higher than long-term rates. that's deadly for the banks. they would have to pay more for deposits and charging less for loans. the bank stocks are priced at absurd levels versus the billions and billions of dollars they're making in recurring revenues i cannot believe the staggering amount of money they make. that's by turning the lights on each day
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the advisory fees they get for investment banking, when you see tons of mergers and acquisitions you know the investment bankers are making a ortune. in the case of goldman sachs, the malaysian scandal will be put behind them. you know that business in asia showed in falloff whatsoever other than malaysia itself i don't know, i was convinced. i think they're going to be okay on malaysia. i know it's bad. it's embarrassing. it's awful, but i think they're going to be okay there are many ways to gauge a bank's stock valuation my favorite is tangible book value, how much money you would have if you closed the company and liquidated everything right here right now goldman's book value is $196 per share, a buck below where the stock is trading they're making a fortune off that book value. we haven't seen a moment like this where the banks are making far more money than people believe since we came out of the
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s and l crisis in the early '90s back then many investors sold these stocks after what seemed like big moves off the bottom only to realize that new buyers were flocking to the group after months and months of underperformance because they recognized something had changed. the banks had gotten better. i wouldn't be surprised if we go at similar scenario this time. the financials make up about 20% of the s&p 500 this hasn't been a leadership group for ages and ages. when the banks get their mojo back they can be responsible for remarkable gains across the market, especially if these companies continue to buy back stocks and rapidly raise their dividends, which they will the bottom line, yes it is not too late to by a tuy the banks there will be plenty of people that say finally, i'm back to even, time to go i'm urging you to think the other way. t a lot of investors decide, what? they want in honestly i think they're making the right call, not the exiters. ideally you've got to get in
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ahead of these late comers jake in new york, jake. >> caller: hey, how are you jim? >> couldn't be better. how are you? >> caller: good, same over here. thank you. i just had a quick question for you about snapchat obviously sudden management changes not a very good thing, but snapchat could probably benefit from a bright set of eyes do you think this is a nice bottom >> i think it's too early to buy snap second cfo leaves, guy left by the way. he had a huge number of stock units that he chose to walk awa from that was one of the most discouraging things i could possibly see that was amazing no one talks about that. i don't think i've ever seen that tom in kentucky, please, tom >> booyah, jim fierce kentucky wildcat country. >> oh, man, great, great what's up? >> caller: forever grateful for your guiding me to self-control on trading and investing.
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>> thank you >> caller: i'm 76. i have a substantial con ed holding in my ira. in light of the pg&e bankruptcy due to the catastrophe, should i re-evaluate my con ed holdings >> jeez, i've got to tell you, tom, i think the world of con ed i think they're an amazingly well-run company, and i think that pg&e was an incredibly poorly run company and they suspended the dividend i really didn't get what the analysts were thinking recommending con ed's a whole other story guys, the times they are a changing this market's coloration is starting to switch it's not too late to do some buying in the bank stocks. "mad money" tonight, eight interviews in two days last week, i can't say i blame you if you missed one or two. tonight i'm revealing the most surprising discussion i had. >> tonight i'm pointing out three winners in the space to see if they can continue their raid. and who keeps an eye on the
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wireless world while you're watching netflix i'll reveal the name i'm going to sit down with the ceo, and it is a whopping good story, so stay with cramer >> don't miss a second of "mad money. follow @jimcramer on twitter, have a question? tweet cramer #madtweets. send jim an e-mail to, or give us a call at 1-800-743-cnbc miss something head to i'm ken jacobus and i switched to the spark cash card from capital one. i earn unlimited 2% cash back on everything i buy. and last year, i earned $36,000 in cash back. which i used to offer health insurance to my employees. what's in your wallet?
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online, or on the go with the xfinity stream app. [shouting] it's all on us, and it's all coming soon. you've got some serious watching to do. in san francisco for the jpmorgan health care conference last week. with just eight interviews on monday and tuesday alone we learned so much from these executives i want to make sure that you've digested the best parts, especially since they were spread across sidewaquawk box a "squawk alley. the huge british pharmaceutical money that's been dead money for years at best, i mean, that
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monster 5% yield, but now it's suddenly become a contender. this one hadn't been on my radar screen at all. you better believe i was shocked when i spoke to ceo emma womsley. that interview aired on tuesday. she laid out what was arguably the most compelling story i heard at the whole jpmorgan conference boy did i never expect that. she spent a long time evaluating various different strategic options that might help her unlock value of this stodgy company. now she's decided on her plan, and she's ready to share it with the rest of the world. i think it's a game changer, which is why tonight i'm going to quickly recap what womsley told us and explain why it is so positive i want you to buy it first, though, you need a little background on glaxosmithkline. th they make drugs, they make consumer health care products. under her predecessor, the company decided to focus on its
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consumer division, the least valuable part of the enterprise if you ask me. they wanted more exposure to the over the counter medicine business he did a $20 billion deal with novartis that involved swapping his anti-cancer portfolio for novartis's vaccine division and combining new businesses under a joint venture controlled by gloxo. you spend fortunes developing new medicines that live or die based on the approval process, whereas vaccines and over the counter drugs are much more predictable. he wanted it to be slow ask steady and he got his wish as the stocks spent years doing next to nothing. >> boo. >> now it seemed like glaxo might have been doubling down on the same strategy. before that she spent most of her career at lore yaal she has the perfect resume to run a consumer package goods
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company. instead she took her time figuring out the best way forward, and then revealed a bold new vision. she doesn't want to double down on consumer businesses at all. she wants to split it off sb a separate company a month ago we learned that glaxo is merging its consumer division with pfizer in a joint venture that they plan to spin off in three years time. it's going to be pretty terrific it's going to create a dominant player in each category this the over the counter space it really will be an incredible business it's got great brands. you know them, you know them all. it's advil, row tuszen, theraflu, along with all sorts of supplements the biggest positive is what it means for glaxo's pharmaceutical division take a listen. >> what's great about this deal, jim is not just what it does for our consumer business, it's the value it also creates for our pharma business, our number one priority, because we get those extra cash flows over the next few years as we invest in our pipeline of new drugs including
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those from the latest acquisition we announced also in december but also then at the point of separation of these two companies where we have two focused companies, one a world leader in consumer health care, and one in vaccines and pharma focused on immunology, but with the right kind of capital structures, the right debt levels for both of them to invest in their future growth and returns to shareholders. >> holy cow. i think this is a terrific way for glaxo to unlock value. you know what it reminds me of when eli lilly spun off its animal health become as elanco best of all, she wants to take the proceeds and invest them into developing new drugs, fast growing business it had been written off and left to dead for wall street. in reality, womsey is working to bring it back from the dead. glaxo announced it was buying a
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biotech with a terrific ovarian cancer drug. >> today the park class is prescribed less in the u.s. than other markets. where it's about 2/3, the second line treatment, in the u.s. it's more like 35%. the big opportunity we have is about going into first line treatment, and here the interesting thing is -- and again, we have a study that's reading out later on this year -- right now it's prescribed for 15% of ovarian cancer patients, women with the brca gene. obviously people have heard of with breast cancer we have a study that is going to be reading out for potentially three times as many women. >> wow, i think that's a great story, too i wanted to play all these bites because i find her enthusiasm about oncology to be infectious. she even made the sleepy vaccine
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business seem like a growth story. listen to her talk about the company's new shingles vaccine >> we've been absolutely delighted with that launch this has been one of the strongest biotech launches in the last decade. in our first full year, 750 million pounds worth of sales, one in three of us on this set is going to suffer from shingles, very painful, and this has got a 95% efficacy rate, tremendous start, great prospects for growth over the next few years. >> when you put it all together, i think it's pretty clear that emma womsley has a vision to transform glaxosmithkline in a positive way she's made a series of moves to reinforce the pharmacy business while also preparing to merge the consumer division with pfizer's and spin it off three years down the road. given that glaxo's stock sells for 13 times erngarnings, i'm calling it a screaming buy she's incredibly per secticepti about the current landscape.
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the bottom line, glak sew smith's klein has had no real catalyst thanks to the bold leadership of emma womsley all that is about to change. i think it's a huge change for the better let's go to james in connecticut. james. >> caller: jim, it's james from connecticut. thanks for taking my call even though i'm a new orleans fan i really wish i had joined earlier. >> oh, thank you. >> caller: johnson & johnson, am i in a battleground stock? should i just sell with a very small profit >> okay, james, first of all, james, thank you for being a member of the club we're going to talk about j and j in tomorrow's call for the club. is it a battleground after the talc news, i think people think it is i've got to tell you, ale alex
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gorsky is the ceo. i think he'sterrific i want you to hold onto it james, we're going to ride this one out, and i think we're going to do well with it let's go to brian in new york. >> caller: booyah, jim. >> this is brian calling from the fishing capital of the world. the only thing i enjoy watching more than your show is your energetic personality that goes with it. >> you're a good man, thank you. >> >> caller: i purchased this stock in september when it went from $3 to $12 in one day. since that time it has been a roller coaster ride going up to $23 and $12 due to concerns about mineral oil being used as a placebo. what is your opinion on investing in this product? >> we were against it for a long time then they actually had kind of a comeback they did some good things. i don't want to recommend it as takeover target. i have no idea what pfizer's going to do. the last outlook was just okay, but i think it's a decent speck,
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and that's what we've been saying about that one. get ready for the transformation of what could be the century when it comes to pharma glaxosmithkline at last, and those of us from philadelphia remember smith, pine and french. i think it's finally happening i think there's a comeback under emma womsley which stocks should you try it on? not everyone, believe me don't make a move before hearing my take. it's at under the radar way to play the pop culture phenomena, the game's 80 million users are having a smooth experience. and what krel gene's acquisition of bristol-myers
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like the department stores, oh, man, are they struggling the weak same store sales we just got from macy's last week and nordstrom today. other companies in different areas are doing really well. tonight i want to highlight three particular retail winners to show you that they've been working and why they've been working and figure out, of course, if they can keep working. let's start with lululemon, the yoga inspired apparel chain that just announced some regreat numbe really great numbers on monday that didn't prevent the stock from getting gutted during the fourth quarter selloff lows on christmas eve, this stock plunged from 164 down to 112. that's bear market action, people since then the stock has caught fire they're still down substantially from its highs, trading $142 as of today what makes this crazier is lulu report instead early december, the results were excellent the company delivered a top and bottom line beat with solid same store steals up 6%
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year-over-year the stock got clobbered. it plunged 13% in a single session, why the guidance management's guidance was nearly in line, not dramatically, better than expected during a bear market like we had at the end of the quarter, that's not good enough when everybody's freaking out about a fed-induced economic slowdown, investors tend to do everything from the most negative possible prism. for lulu that meant interpreting their forecast that the story had gone off the rails immediately a bunch of analysts came out and pounded the table telling people to buy it because lulu was doing just fine matt boss from jpmorgan, perhaps the best retail analyst on wall street, added lulu to its best ideas list that same day the same store sales growth continued to be terrific there might even be some gross margin
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it hurt when fed chief jay powell indicated he might be willing to hold off on more rate hikes for the moment suddenly the macro worries were gone the best news came on monday when lululemon presented at that big icr conference in orlando the company substantially raised the forecast for 2020. they originally predicted same store sales growth in the high single-digits, the low double-digits. now they're talking about same store sales in the high teens. i don't know many -- really, it's hard to find retailers better than that, thanks to higher traffic online where they are amazing and in stores. it's incredible, especially when you consider lululemon is up against very tough comparisons according to jpmorgan's boss who was there, the company called out strength in women's pants, men's outer wear and accessories. lulu's ecommerce business is on fire, and above all else, lululemon remains a fabulous growth story company's putting up new stores at a rapid pace, and now they're
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doubling down on an international expansion. i've been saying over and over again, it's an experiential place to visit, when they talk about mindfulness, they actually mean it. the stock never should have been down so much in the first place. this narrative never really changed the whole time i've liked this stock for ages even though it's run dramatically over the last few weeks, i think it's a buyer. remember, we like growth in cram america. next up more complicated, yeti, the maker of a coolers and tumblers, bottles, mugs, all stuff you can take with you when you go camping yeti had the misfortune of coming public near the end of october, just about the worst possible time for an ipo now, i highlighted yeti roughly two months ago on november 19th telling you that while the company was far from perfect, i
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thought the stock was attractive at 17 bucks and change, so i gave you my blessing to buy it, but only for speculation needless to say i got it wrong yeti's stock continued to get clobbered. when the company reported its first quarter out of the gate at the end of november, it delivered a solid top and bottom line the analysts went ga ga for these numbers. the market disagreed after opening positive, yeti ended up selling off 16% the very same day. it was a very surprising reaction i still don't know what to make of it, except perhaps some traders were expecting a massive blowout. by the time the market bottomed around christmas, yeti was trading at $12, with most o'that have decline coming on no real news whatsoever. so as soon as the stock market stabilized yeti stabilized the company went on to produce some fantastic numbers earlier this week.
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their sales scores accelerated thanks to the booming direct to consumer business. the stock popped from 16.72 to 18.42 on monday. what can i say, i like yeti a lot here, but we obviously don't have the best track record with this one still, with the stock trading at less than 15 times next year's earnings estimates, i think this is a steal yeti has 22% sales growth, for heaven's sake. the valuation for yeti is crazy. finally, speaking of crazy, there's crocs, the makers of those weird looking but incredibly comfortable shoes that made a major comeback generation xyz, they love these things you know you're getting old when crocs are considered retro chic. that's the reality this brand is loved by teenagers. what do they put them on when they play fortnite in november i pointed out this stock had been roaring. i held off recommending it because i thought it was too
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risky betting on any fad driven by teens of course crocs is the one stocks that managed to keep chugging higher throughout the downturn it was at $25 when i said it was too risky for me now it's at 30 crocs preannounced on monday, the company's forecast for the current quarter was merely good, not great. the stock dropped about a dollar on the news. my view, look, i have been too cautious on crocs, but sooner or later this fad going to run out of juice while i don't know when that will happen, i do know that crocs sells for 24 times earnings, and that's too expensive for a company that's only expecting mid-single-digit growth this year remember what i said about lulu, similar multiple but growing much faster bottom line. the department stores may be in rough shape here but that's because people people are buying stuff online or stores much more fun to shop at we know lululemon, yeti holdings and crocs have been doing well i love lulu, i like yeti let's speak to victoria in
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california victoria. >> caller: hi, jim i watch your show every day. there's no one like you. i think you're great >> thank you so much victoria, thank you. >> caller: i'm really heavily invested in ups, but they're not showing the gains i thought they would at this point considering the market i know the earnings report is coming out in two weeks, and they're coming off a strong holiday season could you tell me what to expect and how the tariffs on china might be affecting this stock moving forward i'd like to see it make the gains it was showing a couple of months ago. >> i've got to tell you something. this is a great puzzle me, like many other people, we love ups we love our ups salesperson. we love our ups relationship it yields 3.75%. i would actually buy some ahead and then if it drops, you get it at 4% yield, i would buy more. this company is going to straighten itself out. when it does, it's going to go
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m much higher. the retail landscape has become very complicated there are still stocks that are working, and i love lulu, okay i like yeti, crocs has run too much for me. that works with the likes of lego, bleacher report and even cnbc, i'll reveal it how do you determine if stocks are too cheap i'll tell you which companies could offer clues. and all your calls, rapid fire in tonight's edition of the lightning round. stay with cramer [knocking] ♪ ♪
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memories. what we deliver by delivering.
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as this market continues to work its way higher, what do you with the cloud stocks? this whole group got obliterated in the fourth quarter collapse, making them ideal candidates for profit taking. there's also a widespread fear we might be entering a cloud slowdown that's a fear that was quickly put to rest the moment these companies started reporting. that's why the cloud stocks have rebounded so hard off the bottom, but can they keep climbing as 2019 continues i want you to consider the case of new relic, the cloud-based software analytics company is one of our cloud princes specializes in application performance, they call it apm.
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it helps clients keep track of what their business software is doing in realtime and how the customers are interacting with it now, new relic peaked at $114 last year. then the stock plunged to $72 the day before christmas since then the stock has rebounded to 90. i think it still has a long way to go, and i think it can regain its old highs. don't take it from me. let's talk with the founder and ceo of new relic welcome back to "mad money." good to see you, lou >> thanks for having me back. >> first of all, congratulations that run to 100 was totally deserving. the last quarter was really magnificent. a lot of it is great new clients. perhaps the one we're most interested in because we're gamers is epic games, which i imagine has to be in realtime perfect? >> epic games is the company that created fortnite, and if you have kids or you're into games, this game has taken the world by storm it's the most popular game in the world. and if that game's not working,
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like millions of people know about it, right? and the company is affected so they rely on new relic's platform to see everything in realtime how that game is performing it's a very complex piece of software that has to work flawlessly in realtime we measure everything going on so the builders of fortnite to keep it running for millions of people 24/7. >> i think it's important, people say to me, jim, ask lou, microsoft's got this kind of software -- >> no, they don't. >> and amazon. >> no, they don't. >> you wouldn't have this level of retention if they had good software. >> look, there are different companies that do different things, observing what's going on in the space, but we're the application-centric company. what does that mean? it means when you're playing fortnite what you're doing is using software we're measuring the software in realtime we do it in a cloud platform that integrates what's going on with the software with the infrastructure and with the end user experience like the mobile app, and so we see all that together and do it in one unified platform and our customers love us for it. >> speaking of the mobile app, i
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saw you in the building, you work with cnbc >> you've got some very smart engineers, they're brilliant cnbc, you just launched an incredible new rev of your app in the fall and it's amazing i use it a lot, and i love it, and again, this is an app that's getting a lot of uptick. i was talking to the teamme they said customers love what the app is doing, and they want to use it more and more and more that is they have to scale when more and more people are using that app, how are you able to handle the scale when people want to see the news realtime, the stock quotes in realtime we provide them the visibility that gives them confidence to move faster and scale to this amazing demandthat the cnbc ap is generating. >> we had a huge omni channel holiday season let me ask you two things, one, tell me how your guys did, and then second, do you hear horror stories about other people who do not -- you don't have to name names -- but who were offline during the most crucial days of their existence?
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>> the thing is for retail obviously so much of their business, particularly their web business, depends on a very small number of days, black friday, cyber monday, et cetera, and that's game time that's the moment of truth that's when we're working the hardest to make sure our software is there to make sure our customers can see what's going on in realtime our customers were thrilled with the performance and availability that they delivered, which turns into business results, jim if your site is slow on cyber monday, you're going miss your quarter. you may never recover from that. you also have a brand hit, so it's so vital. this is not nice to have software anybody who is competing on their software needs new relics platform to succeed we're a massive cloud operation. we're collecting millions of data points every second from mobile applications from cloud infrastructure, every time somebody's pressing a button to buy something, every time someone's watching this video on the cnbc app, we're measuring the hemt alth of that
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when fortnite said, hey, we've got this huge app. it's the biggest in the world skpr >> your biggest day is another day for us we collect so much data and we can do it for you. >> there's a moment in your last kfr conference call in november where someone asked you about ibm and your partnership you make a great point that it's going well you are switzerland, you don't care who you work with >> absolutely. it's clear that we're entering a multicloud world and obviously microsoft's doing well, amazon obviously doing very well. we had a great show at reinvent, and there's some hybrid cloud as well what our customers are saying no matter where my software is running, i want to see it all in one place. i'm sick of moving from one tool to another to see a complete picture. they turn to the new relic platform to see it all in one place. that enables them to move fast with confidence. >> you do which i think is -- and i said this when i introduced it on the show is the best of the sports dot comes it really is amazing.
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any of the other guys realizing they've got to have mul multidimensional >> absolutely. there's a major media company, for example cricket in india, tens of millions, hundreds of millions of people watching cricket, because there's these huge test matches, and you know, in realtime new relic is making sure that's delivering it's not just local sports it's global. anywhere there are systems that need to perform well and scale well, those are systems that need new relic. >> we know that there's just -- there's greenfield, boy, the site that went down this holiday season, it just -- i don't know, they don't catch up, lou. >> it's tough. what we say to our customers is building great software is not easy, but it's the foundation upon which companies can build great competitive advantage. we want to deliver amazing software that delights our customers and grows their businesses. >> terrific. customer centric, make it so you get a big market cap
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>> that's lou, founder of relic, amazing he's got all these great clients and it's just starting duncan just protected his family
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>> announcer: lightning round is sponsored by td ameritrade
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it is time lightning round! and then the lightning round is over, are you ready? time for the lightning round i'm going to start with joe in washington. >> caller: yeah, i love you, cramer i watch you every day. >> can't beat that, can you? what's going on? >> caller: i have a lot of money in it, do you think i should sell it or -- >> no, it's too inexpensive. just a couple of social media companies that are working they're doing a lot of bigti advertisers. i say buy. eve in massachusetts. >> caller: hey, jim, i'm a big fan of your book, confessions of a street addict. >> what's up >> caller: my confession is
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about deutsche bank. i know it went up today. i'm certain it goes down with brexit and the money laundering scandal? i don't know the stock has come down. i don't like the stock there's a lot of other banks i like i think they probably need to raise capital, but look, there's far better bng stocks out there. let's go to don in illinois. >> caller: mr. jim, booyah. >> booyah. >> caller: calling from elgin, illinois, near to the pole banging chicago bears. >> yeah, you know, cody, all right. nice person. what's up? >> caller: i'm 68 years old, and i still like stocks. while i know that no appearing to be safe stock exists, ge, i have some at&t, and i'm wondering if i should buy more or something else? >> you know, i've got it tell you, i wouldn't buy more the cash flow is there for the dividend i've inspected this pretty close. i think you're fine. just don't buy any more. >> i want to go to patrick in texas. >> caller: how you doing, cramer, patrick in san antonio. >> san antonio, love
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great town great venice, it's like the venice of texas. i'm not kidding. what's up? >> caller: my stock is t.j. maxx. >> winner, winner chicken dinner i like that stock very much, along with burlington, there, a couple of great ones and by the way -- >> we go to kenneth in new york. kenneth. >> caller: hey, jim, this is kenny from new york. i was wondering what your thoughts on iip are? >> iip are >> you know what this is another one of those that is just -- i don't really know -- you know, this is like it's got a cannabis angle, and people are too excited about it they're just too excited about it cannabis exciting but i liketo invest in things that make money. i want to go to zack in florida. zack >> caller: jim, a big blue nation booyah and a happy anniversary to my wife today is my anniversary. happy anniversary.
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my stock, cara therapeutics. >> it's also derrick's birthday on our staff it's really amazing. >> we like cara. i know it's kind of stalled here, but i do like it very much i'm going to say stick with it it's worth it, and i just -- disturbing news here, i see jack bogle, one of my absolute heroes passed away. he's a great man father of the index fund, and that, ladies and gentlemen, is the conclusion of the lightning round. >> the lightning round is sponsored by td ameritrade what's the hesitation? eh, it just feels too complicated, you know? well sure, at first, but jj can help you with that. jj, will you break it down for this gentleman? hey, ian. you know, at td ameritrade, we can walk you through your options trades step by step until you're comfortable. i could be up for that. that's taking options trading from wall st. to main st. hey guys, wanna play some pool? eh, i'm not really a pool guy. what's the hesitation? it's just complicated.
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step-by-step options trading support from td ameritrade
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♪ how do you determine when a stock has gotten too cheap who's the arbiter? the companies, that's who. the companies that buy other businesses at substantial premiums to where their stocks have been trading. these acquirers are snapping up targets like mad because those targets saw their stocks collapse in the greatbear market of 2018, also known as the pow pow bear market because fed chief powell hit stocks, pow right in the kisser when he set up rate hikes at the beginning of october case in points this morning we woke up to the news that fie serve is buying the stock of
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first data for $22.74 a share. wow, huge win for first data shareholders, congratulations as this was a $17 stock yesterday these two financial companies have been talking off and on for months consider this, the first data was trading at 22 bucks in september before the stocks was felled by an earnings miss i'm betting the top dogs at pfizer love the merchandising business but they didn't want to pay $32 per share for it which would have been a reasonable price tag back then. now they're paying ten bucks less no deal? deal two days ago newmont mining bought gold corp., 17% premium gold corp. had been trading over the previous 20 days would it have been additive as much as it is if gold corp. was trading at 14.09, not $9.69 where it got the bid i don't think so how aboutilly's bid.
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lily's paying $235 per share or $8 billion to cement its role in the targeted cancer therapy space. sure it may seem excessive giving that lock sew traded $139 the week before. we're talking about a whopping 68% premium. back in july, loxo traded 192. i'm sure lily looked it over and passed based on how much it would have passed at the time. that was an opportunity for little by because it meant this acquisition was suddenly affordable finally there's bristol-myers purchase of celgene for $74 billion. this gigantic deal is a textbook example of what i'm talking about right now, right here. sure it seems like bristol-myers is paying a big premium, but wait a second, 66 bucks, celgene's stock was selling at an almost impossibly cheap six times earnings this deal only works because the
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pow pow bear market crushed the group causing celgene's stock to plummet. at these levels the darn thing was too cheap for bristol-myers not to buy it. it was too cheap because biotech had fallen out of favor with the wall street fashion show bristol-myers doesn't care about the fashion show it cares about earnings and new drugs in the pipeline. celgene has both, which is why this deal will be so beneficial to bristol-myers shareholders. we know from the big bank conference calls that there are a lots more deals in the pipe. again, that's because the stocks got too mutilated. they're so cheap that opportunistic buyers would have to be crazy not to pounce. deals that were simply unworkable because of price four months ago are now being done with alacritalacrity i bet this merger mania is just getting started. stick with cramer. people tell me all the time i have the craziest job,
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the riskiest job. the consequences underwater can escalate quickly. the next thing i know, she swam off with the camera. it's like, hey, thats mine! i want to keep doing what i love. that's the retirement plan. with my annuity i know there's a guarantee. annuities can provide protected income for life. learn more at annuities can provide protected income for life. ♪ the unknown beyond the horizon. that was once our frontier.
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all right, how much for the recliner, then? wait wait... how did that get out here? that is definitely not for sale! is this a yard sale? if it's in the yard then it's... for sale. oh, here we go. geico. it's easy to switch and save on homeowners and renters insurance. as cheap as the bank stocks are, the really cheap ones are the regional banks that yield around 4%, and morgan stanley which reports tomorrow, believe me, this group is just getting its momentum if goldman sachs goes down from being up 17, that may be the cheapest of all. so don't be dissuaded just because they've moved. i'd like to say there's always a bull market somewhere. i promise to find it just for you right here on "mad money." i'm jim cramer, and i will see you tomorrow - yeah!
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male announcer: david leeman is a family man with a big dream. - this doesn't happen. guys like me? come on, i'm just a normal guy. announcer: of taking home... - you are on your way to what is a perfect game. - that's what it is! announcer: and vows to never give up. - with this money, i would like to give my wife the dream wedding that she deserves. [cheers and applause] announcer: even when the banker... - are you willing to sacrifice? - oh! announcer: tries to cut him down to size. - oh, my god! [cheers and applause] announcer: from universal orlando resort, it's a heart-pounding, fist-bumping power hour of "deal or no deal."


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