tv Mad Money CNBC July 22, 2019 6:00pm-7:00pm EDT
>> when a market doesn't do what it thinks you think it should do oil should be up 4%, 5%. >> sounds like a riddle. >> number two delta airlines my mission is simple, to make you money i'm here to level the playing field for all investors. there is 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 to entertain and teach you. call me at 1800-743-cnbc or tweet me @jimcramer. dow up 18 points nasdaq gaining but a big victory for the bulls.
see, there are about a dozen weeks each year when we're in the heart of earnings season and the wall street analysts become powerful enough to control the action this is one of those times they have an outside ability right now to move stocks particularly tech stocks. today because of chatter about a possible break in the trade log jam with china and britain and iran didn't seem to go to war with the tak nker, the bulls pushed stocks higher it's important to know how this works. behind the scenes i'm opening the curtain to give you solid examples how the an lists are able to move some stocks and therefore the entire market. it's beens toed back and forth since it peaked at $64 and change for pulling back to $28 bottomed in december when micron reported, they made
positive noises enough to send the stock into the stratosphere and goldman sachs decided to call the bottom in the chips and the stock had yet still one more leg higher as the buyers went nuts for it. and that's how it could rally another 3.7% today on top of the previous boot. micron is the most important out there. their flash tips go into everything this upgrade that came out yesterday was the talk of the town in the all places, people were talking about it and said what do you think of the gold man upgrade. the calls included the semi conductor equipment makers and cramer search. makes sense. if you really believe commodity chips are booming, you recommend capital equipment stocks from there the pin action caused the entire semi conductor to run including texas instruments that
reports tomorrow that's how big a call it was this positive action, semis could continue tomorrow if press reports are true about apple's buying intel's modem business to break away from the strangle hold any consolidation is positive but speaking of apple, bigger news, katy at morgan stanley made a bold call one week before apple reports earnings, one week she publishes a piece suggesting apple has an attractive setup into earnings because investor sentiment remains negative despite improving iphone and services data points end quote. this is a gigantic call. ka kayty huberty made a call one week before apple reports earnings, she published a piece suggesting apple has an attractive setup into earnings because investor sent timent is negative with set points this is a gigantic call.
it is going against all conventional wisdom here this very day, tony is the apple skeptic published a note, a note explaining that the company could have weakness in the very same services division that she's excited about. get this, human being huberty ba grow and think it will be more like 12.4%. the consensus is in the middle because of the call, apple ran more than 2% today while that may not sound like much, remember, you have to deal with $950 billion. she has raised the stakes. on top of that, she raised the price target from $231 to $237 it matters because apple is trading at $207. nowhere near her $231 target why bother to raise another $16 insult to injury i don't know no, not at all it's a line in the sand. it's the statement saying i know
i'm right. you're wrong i don't like to jinx one of my favorite stocks and my absolute favorite companies but the call messes up with the setup we hated in "mad money" when stocks run into earnings toe ni tony comes on air and says i see the services, apple's best days are behind it after the company reports and if huberty reports amazon, stock had a nice move today because of a deutsche bank report saying amazon and i quote is in the sweet spot of slightly accelerating revenue, end quote, the analyst also expects some margin improvement this is terrible as soon as i read this today, i said donate it all if you own amazon, i can't think of a worse piece of research to come down the pike because i think it could be in line revenues given that management repeatedly told us they are in spending mode.
they received incredible pickup of the cloud business, i'm confident they will have a huge number but i don't think that's enough to push the stock higher after today's positive research report it's ratcheted the expectations like katy human being huberty we you know who has a hefty setup alphabet, this morning steven from credit suites came out with a piece where he talks about how the business could come in softer than expected i like this call he's using a $1400 target for the 1,139 stock this reset is exactly what the bulls need that said, alphabet is reporting weaker and weaker numbers when you consider how much money the consumer product companies are pouring in and should be reacceleration of the business and if we got that, i think the stock would tack on $100, almost instantly. look, i'd love to say this is
inside baseball. it feels like it you have katy huberty, never heard of her and this guy. listen to me, you don't need to think about whatever these analysts are actually saying but to a certain extent, i've got to be sure you understand the context. if you like a company and believe it's doing well and you're comfortable with the products and financials, you're going to be fine the reaction of a stock to what we call the print will depend on what it's done before hand and that comes down to the calls if katy huberty hadn't drawn the line, i feel much more comfortable telling you to buy ahead. if apple fails to raise estimates and doesn't talk up the services business, you'll find yourself on the wrong side of the trade if the quarter is good, you borrowed some upside if it's bad, even for one of my favs, look out below one thing is for sure after this run, it would be a mistake to buy apple going into the quarter. the goal between the bulls and
bears is too wiede for us to gai apple. own apple, don't trade it. if the quarter goes well, great. if not, i expect the stock will come down and you can buy more in a weakness at a much lower price than we got today. how about jeff in california, please, jeff >> caller: hey, jim, repeat caller big fan of the show. >> thank you for calling again what's up? >> caller: i'm doing research on industrial gas companies they have a lot of pricing power. i was taking a look at lind kbrr y because it looks like they are one of the best. >> they are. jeff, i got the tell you, the merger should not have been allowed. there is so much pricing increase in this industrial gas business you got the best one i will reiterate now this stock has another 10% in it no problem.
analysts have an ability to move stocks especially during earning season you know how this works if you own the curtain back, pay attention. weak expectations could create a nice setup and high expectations creates a bad setup. is it a go for grocery outlet? i'll take a closer look and with back to school season around the corner, i'm telling you which retailers to watch in tonight's off the charts but first, i took a little trip today. they say money doesn't grow on trees, but that sure doesn't stop me from looking coming to us from a home depot in new jersey. >> announcer: don't miss a second of "mad money." follow @jimcramer on twitter have a question? tweet cramer #madtweets. send jim an email to email@example.com or give us a call, at 1-800-743-cnbc. miss something
oh right. you need to stop and smell the roses of savings. bring in your own phone, switch to xfinity mobile and save hundreds of dollars a year. now that's simple, easy, awesome. get $100 back when you bring in an eligible phone. click, call, or visit a store today. it's the end of an era for home depot when next month draws
to a close, the depot's chief financial officer and executive vice president or courporate services will retire after 24 years including 18 years as cfo. she is among the best in the business, if not the best. now before she retires, we wanted to have one last conversation with her about her legacy in the state of home depot going forward. we spoke to carol earlier today at a home depot here in new jersey take a look. carol, i've never asked any executive this, how is this company home depot going to live without you? >> jim, it's so great to be here you know, we're 40 years old as a company. i've been there for 24 of those years. it has been an incredible blessing i am just so excited not about where we've been, about where we're going. it's bittersweet for sure but the company is in great hands. richard will succeed me as our cfo. he has worked for me for 13 of the 14 years that he's been at the home depot
he's going to do a bang up job for us. >> okay. let's talk about the bang up job you did. >> well, thank you. >> first, people want to know what does the cfo do and what did you do for home depot that was unique to home depot as a cfo? >> well, i think the best cfos are business people first and financial people second, so early days in my home depot care career, i put on an apron and worked in the stores -- >> finance person? >> absolutely. i realized i needed to speak the language of the home depot, not the language of finance, the language of home depot and along the way i learned a lot about the business everything starts with the customer the answer to all of our strategy questions are actually found in the store i think that made me a better finance person because when it comes to things like capital allocation, which is what cfos should do, well, just look at this store you can see it at work if you look at now signings
package, that's part of a $5 billion investing plan that we have inside of our stores. that's improving the experience and by the way, lifting our sales. >> i hear you say this in the first thing that comes to mind is aren't you going to miss it if you talk about it, you love this culture how will you transition out? >> well, you know, i've had more tears shed over the past several months than i thought were possible for a human being and goodness, gracious, no one has died i love this company. i love the people of this company but it's time for me to move and do something else the cool thing is i'm long home depot and my husband ramon and i are creating a family foundation. >> tell us about it. >> we'll pay it forward in a meaningful way, we hope. we really care about how home depot performs because of that. >> and that is also home depot's tradition. i was curious to know you talk about capital allocation the company is deeply committed to veterans and learning and
education because of your boot camps. >> yes. >> how do you allocate something towards something that the classic milton freed mman says that's not within the confines of a corporation and should be wasting money on. >> well, one of our cole valre is to do the right thing we committed $500,000 for affordable living for veterans but doesn't stop there we're all about job creation so we've committed $50 million to create 20,000 trade jobs that's how we can allocate capital to actually grow the business because if you don't have people who can do the work, your sells are capped. it's an easy financial decision to make, actually. >> that's great because i think a lot of cfos do not view themselves as someone that should be anything other than a can, which you're anything but on conference calls where everybody knows you as the dean. we always look to you to try to get a sense of the consumer to try to get a sense of whether the invest -- the homeowner is
investing or is the person expensing. these are concepts that are core to you you've created them. tell us about them. >> right well what we know that if the homeowner believes their home as an investment and not an expense, they spend more money in their home. we have seen home equity values more than double since 2011 and you can see that in our sales. because people are coming in and doing major projects be it redoing kitchens or bathrooms or building out their basements or she sheds or man caves they feel their home is an investment as we talk to millennials, we were nervous whether or not they wanted to own a home. >> right i remember during the period there was a period you were worried about student debt and whether millennials would leave the couch. >> we saw the largest cohort of buyers were age 33 as they start to form their family unit, whatever that is, they are buying a home but they
told us through our research we want to work on our house because we think it's a good investment so that's music to our ears. >> now some other things that you've had to do and i know you were involved with them, you realize not but thing which is amazon but by project your professionals, which you own that market now. professionals when in e commerce, how did this come about? it was not beginning initially in your culture. >> well, one of our core values is entrepreneur spirit and you might think how can a company of your size be an entrepreneur we want to investigate customer needs, wants and desires we're finding the contractors are actually finding the mobile device to be very helpful to them they can store inventory by store, they can order and have the order shipped to their job site it actually is important to them one of our major investments is going into what we call the b to b experience, which is taking our existing website and
creating an experience that personalizes to you whomever you are. if you're an electrical pro, it will personalize to you. if you are a plumbing pro, it will personalize to you. you see what you need for the job. of course, you can shop the entire site. we're going to make it easier for you to get what you need, and down the road, we don't have it yet, down the road we'll have personalized pricing on that experience now, that is going to be competitive secret sauce because nobody else will know what we're doing but that customer and our team. >> if i were the fed, i would want to know what you're doing you've got a handle on so many things how often does the fed check in with you >> well, it's interesting. the atlanta federal reserve bank does a nice job of reaching out to the sixth district to talk to companies and organizations what they are seeing in his business. i've talked to the atlanta fed quite often. >> all right that's good.
i feel better about that because i feel like that you have a unique view i want to go back to some of these socialsocial issues and t idea, your website can be good, the notion of teaching people computers, digital that was just something you initiative took upon yourself. you didn't go to stanford. i know you were involved with that how did it happen and how is it working? >> there is a war on talent in the united states. >> i like that. >> there is a war on i.t. talent for sure so we went to our stores to say okay, if you have a capacity for this, a desire to learn, we will teach you how to code. so we have brought these associates into our company and have taught them how to code and they are working in our i.t. organization couldn't be more proud of them it's so exciting we compliment those associates from kids graduating from georgia tech and other technology schools but it's really cool to create careers at
the home depot and this is what we do at this company. we create careers. these aren't jobs. these are careers. >> last question, what do you want your legacy to be 18 years, senior cfo in this country for home depot and women and america? >> i want my legacy to be the impact that i've had on people not just the people who are following me in financial but the people of the company. when i started 24 years ago, i was all by myself, but if you look at our leadership team now, you see women in power we have three executive vice presidents who are women today and it's throughout the entire company. i'm so incredibly proud of them. and i hope they are proud of me. >> well, carol, thank you so much you've been a great joy. everybody follows you. everyone wants to know what you're thinking and you have taught so many people about business thank you so much. that's carol tome, the home depot retiring cfo
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nearly three weeks ago i got a call about a newly pu lly pub company. i needed to do homework. this story is intriguing but maybe not so intriguing as would buy at least at these levels so tonight i want to plano your ipo because at the very least, grocery outlet is certainly worth getting familiar with. what is this okay, grocery outlet runs a chain of discount supermarkets called grocery market bargain outlook. they offer terrific deals and they try to create a treasure hunt shopping experience whenever you think of ali's as one and costco what kind of deals do they offer. the model allows them to sell name brand products at a 40 to
70% discount than a traditional supermarket. wow. i need you to think of this company as an off price chain, not like tjx or ross in the grocery business. they have a terrific centralized sourcing department that exists to opportunity to buy products at deep discounts and that's how the company kept giving the customers ridiculously low prices i love this concept. retailers need to be online or off price if they want to win in this environment i call grocery outlet a change a second ago maybe over stating things but each store is run by independent operators who have the leeway to personalize locations. it's like a franchise-based supermarket. the people that operate each store are small business owners that gives them more of an incentive to do a good job it's a neat model. grocery outlet is the regional to national growth story that wall street tends to get super excited about. in 2006 they had 128 stores on
the west coast and now 323 stores on both the west coast and in pennsylvania. because of that expansion, the company sales tripled. they put up 15 years of positive store sells including some incredible numbers during the great recession. hey, listen to when the economy was down in 2008, 2009, they posted 12.3 and 14.7% same store sales respectively these numbers make it crystal clear this is the trade down play you want to own in a slowing economy and better than dollar tree and dollar general we don't really have that kind of economy right now where the consumer seems to be doing just fine maybe there is no need to trade down that's a principle glitch in the story. still, you understand why so many would salivate during regional and national growth no wonder people bought the stock hand over fist when they bought the stock a little over a month ago. the deal was supposed to price
between 15 and $17 but had to raise the range from 18 to $19 and even then, that wasn't enough with the ipo eventually pricing at $22, that's a big jump because there was such demand. as soon as the stock started trading it popped to $31 and pulled back closing at $28 and change however in the month gr grocery outlet is a power play a big chunk came when they initiated a buy. more in a minute before we get into wall street, let's have a look at the numbers themselves thanks to a combination of new stores and low to single digit growth, they will deliver low double digit revenue growth for years up 12% in 2016 and up 13% and 10% last year but the sales decelerated and spectacular in an environment where so many peers have been struggling with cutthroat competition.
we've been recommending none of these stocks think something like kroger. it's toogrocery outlets have been profitable and scaling up and and panldexpanding. the name of the game is consistency. for years the company put up 20 or 30 stores annually with steadily low comps and gross margins what they make after the cost and we saw this same thing in the first quarter this year i like consistency it's a good company but is it also a good stock? last week the quiet period ended that allowed brock cahouses, ge positi positive we usually know from his department store coverage had one of the most bullish calls. he gave grocery outlet a $42 price target why? it's a very well run off price chain and allows the company to
give the customers incredible deals. which in turn means they can take market share. assuming grocery outlet continues to grow the footprint by 10% per year with low single digit, stable gross margins, they think the company can generate growth in the mid teens. don't have a lot of those. that's spectacular for a supermarket and you know i love it long-term is the grocery outlet has the potential to grow from 323 locations, which is about the number of locations whole foods had, a little bit less when whole foods got a bid from als amazon he thinks they could grow. these guys are the largest operator in the space which means they are the first to get the call when fraud producers need to clear inventory. i think tim makes a compelling case and allows the perfect kind of stock to buy. it's exactly the kind of trade down play that benefits from a weaker economy but the consumer is doing fine. no urgency to buy and if there is no urgency, it's tough to
identify the valuation right now grocery outlet is expensive and sells for 66 times this year's earnings estimates remember, it has earnings. 50 times next year grocery outlet is an extremely well-run chain but trading like a high-flying tech stock consider the comparisons when you look at the earnings for that one i mentioned kroger trading at nine times. sprouts 13 times target 14. costco sells for 33 times if you use the word only. five below, another one of these rapidly growing companies, that is a good comparison and cheaper. compared to these other outlets, grocery outlet is spectacular growth the earnings are expected to triple but in 2020 it will slow to 2% and over the next five years, it would be a 19% on average number those are great figures for a grocery store chain but not worth paying 50 times earnings and still improving.
something five below is tested and growing. it's valued at only 33 times earnings if we value grocery outlet like five below or costco, it would be a $25 stock, far below the current price. that's what you have to think about, the compares. if you really believe in the story or think the economy is cruising for a bruising, you can justify paying for the premium i could justify paying 43 times earnings for a company with a long-term growth rate although that still gets you to $31.20. in short, grocery outlet the stock is ahead of itself the bottom line, when zack in california asked me about grocery outlet three weeks ago, the stock was a buy. i wish i had said it but i needed to do more research up here grocery outlet is an intriguing company and i just can't count. i guess i could rush by saying i love the discount grocery story, i just want a discount on the price of the stock let's go to joe in georgia, joe?
>> caller: yeah, good evening mr. cramer and a boo-yah back to you, sir. >> i like that what's up? >> caller: i'd like to give a shoutout to my fellow nurses at the v.a. hospital and i have a serious question for you. >> good shoutout, go ahead >> caller: based on your assessment of the work ipo, not that long ago, i did take your advice and did not go over $40 i picked up 100 shares at $40 a share. watched it drop down to 20% below it's ipo up today to about 17.5% below the ipo. my serious question for you is what do i do now which way do i go with this stock? >> okay. special shoutout to me for the v.a. and nurses and doctors very nice to my late father who went there, i don't know, every day because it was so much fun i'm not kidding. here is the deal this stock is up $1.95 today and we're talking about slacking i think the slack is terrific and i would say it's fine to buy
more obviously i don't like to buy $2 but slack is going to be a big disruptor. so i like it grocery outlet has a spectacular story but run up a lot i say wait for the market to give you a pull back for adding it to your shopping cart much more "mad money" ahead. i'm focussing on retail embracing the comp tetition from amazon and i can't blame anyone for being confused on the price of oil all your calls, rapid fire in tonight's edition of the lightning round so stay with cramer ♪ you should be mad they gave this guy a promotion. you should be mad at forced camaraderie.
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least we last week we found out something important. there is a smoking consumer economy and the hit or miss business economy if you sell things to the enterprise, i got to tell you, i think it is a crap shoot if you sell things to individuals, chances are really good you're thriving and within the consumer economy there are a hand full of companies that dominate the
rest how how importa' remember how important, the ability to be big and pass on deals to you, the consumer i'm talking about watch, my acronym for walmart, amazon, target, costco and home depot. these five players have fabulous fundamentals but tonight i want to take a step back and evaluate them from the technical side and that's why we're going off the charts to get a better reading on watch with the help of bob. the founder of explosive opti s options.net and the brilliant street.com newsletter and wrote a book called "know your options. all five of these particular charts look like they are in great shape but given that amazon is reporting this thursday, no thank you and home depot is more specialized, let's focus on walmart, target and costco these are the three quintessential big box chains. with back to school season right around the corner, these three could have a lot to look forward
to remember, watch is all about amazon, the major retailers to n i love the fundamentals. walmart, target and costco have been red hot and i don't blame anyone for worrying that maybe that they are too darn hot and we know what that means. it means that they are dicey and worrisome and that's why we have to consult technicals to s ts te we're okay let's start with walmart this is a big daddy brick and mortar retail. this stock has been snorting like a bull. look at that chart all year long. last month walmart broke out to the upside and volume, look at this target's volume is a polly gram. this is just a huge spike in volume when the volume is low, it means a move might be lying. when it's high, it means the action is telling the truth. the needle of those, you need
all of those shares trading to find out whether there say false move or real and the relevant strength index rsi this is one of my favorites. it's an important momentum indicator but over bought ter r territo territory, that's the green for a month and a half you got a new term here. you got an embedded, this is embedded over bought situation where stock can sell well and money managers keep buying it. that's what lang things ks we he i describe stocks as anointed winnersment t winners. you want to know how to spot an anointed winner? check out walmart's shaken money flow that measures the level of buying or selling pressure in a given stock and a way to figure out what the big money is doing. walmart is in positive territory for quite sometime here meaning
institutions are buying this stock hand over fist normally you kpuexpect it to be down here, no. they keep buying it on good days and bad. it dipped below the ten-day moving average be worried about that. that's a soft floor of support but the last time that happened was in june and afterwards, walmart rebounded and came roaring back this stock has no real resistance and hit a high of 115, he thinks it's smooth sailing to $130. that's a very big call next up how about the data chart of a stock of a company i was visiting two weeks ago, target this is the smallest company in the watch brotherhood. target may not have the scale of a walmart or costco or of course amazon what they do, they do very well. ceo brian cornell has done a fantastic job of scaling up this retailer he's really, really gotten his hands dirty and goes to a lot of
stores and understands the format and has inner city and college stores and he's got everything going for him but what does the chart tell us? lang has spotted a nice longer term cup and handle formation. wow. i got to tell ya, that's where stock makes a cup shape bottom right here and then trades sideways for a period of time forming a handle, right and this is one of the most reliably bullish patterns of the book and that's why with the stock basing at a higher level here, he thinks the stock is ready to resume the up trend. i could not agree more i would pull the trigger tomorrow once the stock manages to break out above $90, lang expects to really get things moving and we could be looking at a run to $100 take a gander at the on balance volume line down at the bottom okay this is a momentum indicator that looks at volume flow adding
the volume up days and subtracting the volume on down days i used to do this by hand to predict changes in the stock when it's rising, lang says it's very bullish look at this target's own balance is moving up steadily for the last two months even if the stock plateaued in recent weeks, the on balance volume keeps climbing. this is precisely what you want to see if you predict the next big move then there is a technical tool we useless often i've not talked about on the show but we're always trying to bring new things to you. the japanese for one glance chart. it's usually translated as the cloud. it uses a number of moving averages to give you a clear read of the situation but what you really need to know here is that when the cloud is green, it means buy, buy, buy. one last point on target look at the moving average another momentum cage that can
detect changes before it happens. lang is always on the hunt for bullish crossoverers where the black line goes above the red line this is tougher. this is one of the most reliabl positive signals that could ignite the stock which is why it's lang's favorite name of the group i would love to see this crossover. i think lang doesn't want you to miss the opportunity let's go to costco this is the daily chart. the stock is sensational do you know the stock gained 38% year to date costco broke out to the high volume now remember, whenever you look at this volume, that lie detector, hey, speaking of volume, the on balance volume, okay the on balance volume, i told you this flowing shows an incredibly strong hand look at this that's beautiful higher, highs, higher lows it just keeps climbing
to me, i thought this was too high and too aggressive but, you know what? lang points out the index off the charts is ridiculous rsi and that's good. costco is in the over bought territory. that's why he's a little concerned the stock may be getting a little toppy here. he's not totally convinced it's perfect for what i said. that said, the cloud is green and expanding. a very bullish sign and if costco gives you a minor 1% pull back, that's a buy pull back to here, buyers will come in. so he and i end up agreeing. put it all together and he believes costco is headed for $300 not that much from here although it might take a slight detour lower before resuming the run. the bottom line, you know i like watch, walmart right? amazon target, costco, home depot and i really like his thesis on target and costco. i'm not as enamored of walmart
it is time, it is time for the likening round buy, sell, buy, sell and then the lighting round is over are you ready? time for the lightning round rein ryan in illinois. >> caller: boo-yah, jim. i had range resources for awhile. >> natural gas lick wquidliquide weakest part of the entire chain. eric in california, eric >> caller: hey, jim, big boo-yah to you. >> boy -- what's up? >> caller: i'm a newlywed. my wife wants a house and i'm looking to get started with gh garden help. >> it's speculative but gene
sequencing and i've been recommending all of those. let's go to sean in nebraska, sean >> caller: cramer, a big-time omaha, nebraska boo-yah to you. >> what's up >> caller: i got done playing warren buffet's paper wizard have you ever played that game >> wow. >> caller: maybe not good one stan will make you look sharp. my question today is about the railroads, last week recordinged earns. >> burlington northern itself, warren buffet is great i've been recommending since the stock began. michael in florida. >> caller: jim, thank you for everything you do for us we appreciate it please don't ever leave because you could not be replaced. >> thank you that's a nice thing to say i'll leave it at that, thank
youmeyo you. what's up? >> caller: seattle genetics. >> we had fifth in them. i don't know about a half dozen years ago in seattle great quarter, great information. trades on research reports about what they have got going and it's good. let's go to mike in california, mike >> caller: hey, jim, first-time caller and new to the stock market and want to get your opinion on the pharmaceuticals i think it can do great things for the human side of things. >> zyne? this is the second call that -- second -- i got one today at home depot at zyne and both i say no if you want it, it's gw fpharma that's the way to play big news, that ladies and gentlemen is the end of the lightning round. >> announcer: the lightning round is sponsored by t.d. 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. step-by-step options trading support from td ameritrade i went straight to ctca. after my mastectomy, i felt like part of my identity was being taken away. my team made me feel whole again. cancer treatment centers of america. appointments available now. so, every day, we put our latest technology and unrivaled network to work. the united states postal service makes more e-commerce deliveries to homes than anyone else in the country.
what the heck is going on in the oil market when a couple of iranian speedboats seize a british oil tanker too many barrels to support in the straight of hormuz, one of the main arteries wouldn't you expect prices to sore at 10% increase instead, west texas crude went up less than a dollar. it is still down $20 from the peak last october. right before the double whammy
moment where jay powell promised to over shoot with rate hikes and penn started pushing for a new cold war with china. since that has not been able to recover, the stocks keep getting worse and worse. why is that? you got four different things going on here that we have to discuss. even though 21% of the oil travel through this choke point right here, the straight of hormuz, the market doesn't seem to be taking iran's actions seriously. the british are saying give us a break here, hold on. give us time we're jammed here with this brexit right now you would think they would attack this tanker the way the couple in boston with twin 8 oc0s oil traders see a slowing global economy and figure the price of crude won't be able to return until europe rebounds or there is a true seize fire in the trade war otherwise there is too much supply. third, you would think it would matter russia and saudi arabia joined forces to limit the
supply of oil and property up prices there has never been such ironclad cooperation the russia is not opec but it hasn't impacted the market one bit. why again because of u.s. production it just keeps growing and growing. the russians and saudis tried to wipe out u.s. producers by pushing the price of crude down below 30 it didn't work we have grown from producing 5.4 billion ma million barrels a day in 2005 to 12 million barrels now we will reach 17 million within a few years. that's way too much oil for the world to abswoorb and the oil market can't handle that supply. no wonder a shrewd operator like chip johnson is the co-founder that sells the company to cohen, smoul co small company for $13 and change even though his stock was at $57, a little over four years
ago. amazingly, crude was at57 back then and the stock is so much cheaper now because wall street has no confidence in the ability to rally finally, the holder dill lem em. management claimed the turn is here i actually genuinely believe in the stock. the stock is a buy because almost every line item is improving and the ones that aren't are going to jet. few believe them because they have been bullish for ages this morning we got a very good quarter from the rival halliburton that might change perception up more than 9% today. they have a lot more north american exposure than s schlumberger they are laying off 8% of the work force because of the slowdown maybe that's why the stock went higher if you want toknow while the oils are so hated, it's very straightforward. we're producing tremendous amounts with the declining rig count that puts downward pressure on pricing and as long as people are worried about the trade tensions with china, oil
is a loser if the trade war ends, oil will rally. the real issue is credibility. almost no one has faith in the oil patch because these compa companies have been so wrong for so wrong that's a lot to overcome no wonder the stocks are so hated. it could get even worse as millennials who have been raised with the knowledge that fossil fuels are destroying the world grow up become tomorrow's big portfolio managers stick with cramer. it never questions the tasks at hand. but this year, there's a more thrilling path to follow. (father) kids... ...change of plans! (vo) defy the laws of human nature... ...at the summer of audi sales event get exceptional offers now! tell him we're flexible. don't worry. my dutch is ok. just ok? (in dutch)
news out tonight that the white house has reached some sort of debt deal with congress that will raise the ceiling on the debt you know what? big deal just get it out of the way while earnings happen. i don't think it hurts i'm not sure how much it helps i like to say there is always a bull market somewhere and i promise to find it here on "mad money. i'm jim cramer and i'll see you tomorrow
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