Transcripts For CNBC Mad Money 20141110

Protect this great nation, some of whom im greatly honored to have with me here today. [ cheers and applause ] because my job is not just to entertain you but to educate you. Of course, call me or tweet me jimcramer. Welcome to mad money salute to the troops. We are honoring all of you brave soldiers, air men, sailors and marines the best way we know how, by helping you defend your financial futures. We thank you for your service and are honored to have some of you join us tonight and happy 239th birthday to the United States marine corps. What do you do when trying to invest long term . How do you fight the short timers and the big timers as they all work today with dow gaining 40 points and s p rising and nasdaq to levels not seen since march of 2000. Pretty easy. You beat them by falling back on big themes, themes that arent subject to the vagaries of the hedge funds and the traders who trade in and out 100 times a day or sometimes thousands of times. You have no choice but to go long term because you simply cannot beat them at their own game. That is what was so terrific about todays action. It demonstrates how longer term themes that have defined this show can allow you to triumph by using their flailing to your advantage. We have so many examples that are ripe for the picking for active duty soldiers and veterans to buy and put away making sure you examine each quarter of the Company Reports because that is minimum amount needed to maintain the stock position. Allow me to pick three stocks that fit the long term themes that played out today. The first is white wave foods. This is perhaps the most critical in the Natural Organic food chain. If you go to the supermarket chances are you bought the horizon brand with the cow on it. I dont mean elsie or elmer. Dont want regular milk, quick to spoil . Then you buy almond milk. White wave is by far the dominant player. I know this is no fad. For the first three years in new jersey we got bad with milk, fat free cream, the usuals. In the fourth year we were overwhelmed by demand for soy and almond milk. The latter simply gone out of style. No wonder white wave had a currency that hit this quarter and was just unbelievable. They had so much business in europe because it is going gangbusters. The horizon brand has branched out to other aisles of the supermarket. The stuff competes directly against annies. You have to wonder whether annies saw the horizon writing on the wall or perhaps heard the hoof steps. If you stroll to the Fresh Produce aisle you will see clear containers of vegetables. I saw in south philly yesterday this brand a mainstream. Why did the stock open up almost 2 and sell off badly . I think it is because ceo likes to under promise and overdeliver. After the run this stock had it makes sense to be conservative. Giving the cow shortage, the desire for healthier food chain and not to mention the fact that most Chinese People are lactose intolerant. I think china can be a huge cash cow for white wave next year which is why it is such a terrific buy. You notice cocacola, kraft, they are all they can snap this one up. The former being the colossus that took over hill shire brands. You know i think that the bio techs have advantage. Big news for celgene and gilead. It owns a stake in pharma, revolutionary way to treat cancer. One of the data this weekend was not exceptional enough. I wouldnt give up on merk. It has a fabulous pipeline. My Charitable Trust tried to buy merck. Finally, for the tech theme of mobile social cloud and connectivity look no further than alibaba. The amazon of china. Something amazon may never have bountiful profits. Today is not only the eve of veterans day but the eve of singles day in china. Alibaba rallied 4. 59 a day. This is one big deal of the day. Alibaba no inventory Online Business model, excellent mobile offering may just justify its amazing move from 68 to 119 and change today. It is now bigger than walmart. I said this stock would go to 120 valued similar to facebook and urge you to play to yahoo. A good singles day and i have to bump my 120 target a hair above where it went out today. Im thinking double since coming public. Here is the bottom line. I always say default to the big goto themes. Natural and organic food, bio tech stocks. Buy them when you can when the short termers give you a chance. Given how the hedge funds seem to buy high and sell low they can be an annuity for those with a time horizon longer than a may fly. Thanks for having us. Your book get rich carefully talks about how Johnson Johnson was a solid stock in early years. Is it still a solid stock . It has fabulous leadership. Why do i like gorsky . He came in and cleaned the shop up. There were so many overhangs whether charges or problems. He is one by one cut them off or at least minimized them and put a lot of new products to market and expanded the company. J j is the classic blue chip stock. Im recommending it here and now. Sir, i was wondering with the president in asia and our markets becoming so closely intertwined do you think toyota is a good buy . I looked at toyota this weekend because i felt like with the yen where it is toyota would have an advantage. I dont like the auto companies. My travel trust owns General Motors and because of china has not been that good. I fear the World Markets whether europe, china or latin america are slowing too much. Of majors toyota is the best. Yes. Thanks for having us. Of course. My question is global star shares recently plummeted in the statement that the spectrum is virtually worthless. Last week musk announced he may have plans to launch satellites himself and get into the spectrum business. What is your take . Why have seen raid. Not happy with the rate. Someone is driving the stock down. We are owed the answers and we will give them to you. On a very special veterans day edition of mad money we are on duty to find the key to investing for the long haul. The Natural Organics, bio techs. What else do we have tonight . Is whole foods healthy again . Stocks up nearly 5 on a big earnings beat. Can it keep putting products in your cart . From frozen to star wars disney is sitting on a mountain of movie magic. I will sit down with a former United States marine who owns one of the Biggest Companies on the planet. Dont miss our interview with the ceo of clorox. Stick with cramer. For over 60,000 california foster children, the holidays can be an especially difficult time. Everythings different now. Sometimes i feel all alone. Christmas used to be my favorite. I just dont expect anything. What if santa cant find me . To help, sleep train is holding a secret santa toy drive. Bring your gift to any sleep train, and help keep the spirit of the holidays alive. Not everyone can be a foster parent, but anyone can help a foster child. Happy 239th birthday to the United States marine corps. On november 10, 1775 first leathernecks formed two battalions and swore to fight for freedom of land and sea. We celebrate the more than two centuries of Courageous Service that has followed since then. On behalf of the state department it is my privilege to wish all marines everywhere a very happy 239th birthday. Semper. Welcome back to a special veterans day edition of mad money. We are saluting our troops and our veterans. Never write off a company with a great concept and terrific management. A year ago whole foods went from being a market darling to a down and out dog. A business getting pounded by rising competition, internal cannibalization of its own stores and a sense that the company didnt have a strategy for dealing with the rise of Natural Organic products which have been whole foods niche at virtually every Grocery Store under the sun. A fall from 64 down to 39 in just the previous 12 months. But then something amazing happened. Last wednesday after the close whole foods magnificent beat with management. For the first time in ages the next day the stock jumped 12 . It has not looked back since. My view, i have been waiting for whole foods to mount a major comeback. This looks like the companys first good quarter out of many which is whyium throwing my full support out of the stock. At this point i think whole foods can be a holding in your portfolio. The kind of stock driven by powerful theme. A company that has worked through all the issues that kept it down for the past year and come up with solutions that can allow the stock to rally for years to come and beat back that competition. Whole foods has gotten its moejo back after last weeks phenomenal results. Even if you cant afford to shop there i think it makes sense to buy the stock for your portfolio. It is down even after the remarkable rally. How has it managed to deliver such dramatic turn around. The remarkable comeback should come as no surprise if you have been paying attention to this story. For months and months management has been telling us what they plan to do to turn the business around. This quarter the initiatives begin to pay off in a major way and i think that is just the beginning of the payoff. Whole foods, this is the store you shop at if you care about what you eat. Now the company is working to leverage that uniqueness and rolled out a ranking system for produce based on the suppliers farming practices. Sounds like chipotle. Whole foods embraced technology. First National Supermarket to accept apple pay. In Early September the company teamed up to offer onehour delivery in 15 cities. The initial response here has been quote overwhelmingly positive as people now order online are buying 2. 5 times as much of the stuff as the average instore shopper. That is huge. On top of that management says they plan to launch a new mobile app next year. Before, during and after visiting the companys stores. What else. Whole foods is on track to remodel roughly 70 of the stores. The earliest renovations led to very encouraging results so this should bolester same store sales. September whole foods started testing the first ever affinity program. Again, early results have been extremely positive. Programs can be rolled out nationally. Company hosts whole foods wine club all over the world as a way to jump into the wine snob market. No other supermarket comes close to delivering this level of quality or service. Then there is the marketing side. Whole foods launched the First National Brand Campaign in order to differentiate itself as americas healthiest Grocery Store. As whole foods put it this Advertising Campaign has positively impacted our sales trends over the last eight weeks. If whole foods delivering quarter to date same store sales well above what wall street was expecting i was looking for a squishy 3 . It is not just all the fancy initiatives. Whole foods cut prices to compete and we are no longer seeing cannibalization areas like boston where the company seemed to build up too many stores. People were worried the whole concept was fill up. Whole foods has over 400 stores in this country. Can grow the number. Here is the bottom line. Now that whole foods has solved the problem through brilliant new initiatives i think we can consider this a fabulous turn around story that can have years of upside going forward. Sure whole foods spiked as reported last week. Long term i think this one is just getting started. Lets take a question. Thank you for having us. Certainly. My question revolves around mcdonalds. Mcdonalds recently opened its newest store for primarily middle class families following starbucks. United states organic lovers are not so inclined to mcdonalds. What is the next market for mcdonalds . I got to tell you, i am concerned about mcdonalds but my Charitable Trust owns it because it has been so bad it can only be up from here. Thank you so much for the question. The proof will be better taste. Sure, whole foods has gone from being wall street darling to dog. It could have years of upside. Much more mad money ahead. Disney the number one movie in the box office this weekend. Clorox helping to stop the spread of the deadly ebola virus. What can be the difference between making and losing money with oil hovering at these levels as our special salute to the troops edition of mad money continues. Stay with cramer. I take prilosec otc each morning for my frequent heartburn. Because it gives me. Zero heartburn prilosec otc. The number 1 doctorrecommended frequent heartburn medicine for 9 straight years. One pill each morning. 24 hours. Zero heartburn. Ghave a nice flight r bag right here. Traveling can feel like one big mystery. Youre never quite sure what is coming your way. But when youve got an entire company who knows that the most ontime flights are nothing if we cant get your things there too. Its no wonder more People Choose delta than any other airline. Boy once upon a time, there was a nice house that lived with a family. One day, it started to rain. The house tried to keep out all the water, but water got inside and ruined everybodys everythings. The house thought she let the family down. They just didnt think it could happen. They told the house they would take better care of her. Always. Announcer protect what matters. Get flood insurance. Stationed here in south korea, i would like to wish everyone back home a happy veterans day. To my wife, brittany, keep holding down the fort. Tonight in honor of veterans day i want to help you find the kind of sleep at night stocks you can own without the need to fret constantly or trade them frequently, long term ideas that make sense for our brave men and women fighting overseas who dont have time to check holdings constantly. Many of you need to do research on the stocks in your portfolio and keep track of them so you can catch any budding losers. Some stocks need less supervision than others. Some companies with terrific franchises and phenomenal leadership can be counted on to deliver. You still need to do home rworkn the names. What kind of stock am i talking about here . Let me give you the perfect example. Disney which has hired 3,000 veterans since launching their heroes work here initiative less than three years ago. [ applause ] when you hear disney your mind probably goes to cartoons and theme parks, kiddy stuff. In reality this is a conglomerate with long term businesses which is why the Company Managed to report a fantastic quarter last thursday. More than half of the operating income comes from television including abc, espn and soap net among others and interest in hulu. I think espn is an incredible property because sports is the one area that is immune to your dvr. People have to watch the ads if they want to see the game in real time unless you go to a personal cone of silence. And the numbers espn has been generating in terms of tv ratings staggering 92 million names in fantasy alone, unique. When it comes to the movie business disney has some of the hottest known to man which is why it was able to grow by 30 thanks to strength of frozen, malefice maleficent. The company has mastered the art of creating hip franchises. They have an incredible slate of upcoming releases starting with avengers sequel in may, guardians of the galaxy 2, and these are just the marvel titles. I the ink the big needle mover will be star wars, a franchise they bought with the acquisition of lucas film. The first film comes out in roughly 13 months with the two sequels following. If history is any guide all three of these will be huge blockbusters. These movies dont even have to be any good to make a killing at the box office. True. We havent even gotten the actual disney brand which has a strong lineup. With big hero 6 led the box office and pixar coming up with a finding nemo sequel. Disney has become a machine for generating mega hit movies. There are a lot of ways to make money including new rides at disney theme parks which help explain how operating income was up 20 . With disney world in particular seeing record attendance. Disney is building a new report in shanghai. The Company Expects they will be able to announce opening date sometime early next year. Disney is about more than just generating content. The strength of the company is a testament to the power of Good Management as exemplified by ceo. And as long as he is at the helm im a believer of disney. He has been veracious. He has conviction. Over the last three years the Company Purchased 13. 6 billion worth of stock and this past quarter they made a very big buyback. This tells me whenever disney stock gets hit the company will be in there buying with you. Disney has a long history of putting excellent results and selling off anyway which is what happened last week. Stock fell from 92 down to 90. I thought the results were terrific. You are getting the stock at a discount to where it was trading. In my mind disney is worth buying. Here is the bottom line. If you are looking for terrific long term stock stick with disney. This company has spectacular ceo. As long as he is in charge i think disney keeps moving higher. The perfect stock to serve with during your active duty years and your veteran status. Lets take a question. How wiare you . Im pumped to be on your show. How do emerging Chinese Tech Companies effect stock prices of Companies Back home such as google and ebay . Google did not choose to compete in china. Ebay has kind of been left behind. Maybe when they split up with pay pal we will see something worth while. I like alibaba. I am concerned that there will be hangover after singles day that may cause the stock to dip. First of all, thanks so much for the time and energy you put into giving individual investors a fighting chance. Thank you. My question is about best buy. I have been holding on to best buy. Has it turned the corner . I dont want to say it is last of dying brick and mortar breeds. I think best buy is still a place. They will give you best intelligence about how to buy go pro. They have a lot of good sales people now. I have been using best buy. I would hold on to that stock. I kind of like it here. Looking for a stock to let you sleep at night. Look no further than disney. I think this company can keep moving higher. Much more mad money ahead including company run by a former u. S. Marine in the front lines in the fight against ebola. Find out what can mean the difference between making and losing money right now. Our nations hero fire stock after stock on the salute to the troops edition of the lightning round. Stick with cramer. Big red one, from our team to yours happy veterans day. Welcome back to mad money salute to the troops. To all the brave men and women who serve we thank you ahead of veterans day. What do we do with clorox now that it has broken out of 100 a share. Here is a company with classic dominant brands, glad bags, kingsford charcoal, Hidden Valley salad dressing and burts bees. Solid 2. 9 yield. The Company Announced it is getting out of venezuela. At the end of october clorox delivered a solid better than expected quarter. The best thing about the story is the management of david canals. He transformed the company into a single business united by a common vision. He is no stranger to leadership. He was an Artillery Office in the marine corps serving from august of 76 to january of 1981. I am thrilled to have him here with us ahead of veterans day to thank him for excellent service. Clorox leads by example when it comes to hiring veterans as they make up about 8 of the u. S. Employee population. Welcome back to mad money. Lets get right to it. You hire veterans because they are good for business, not just because you are doing the right thing. Absolutely. What we find with veterans is they have a mission orientation. They know how to get the job done and they know how to work in teams, diverse teams across different branches of service and have a work ethic. They actually show up. Showing up is a big deal. That was your decision, you have been surprised that other companies who perhaps dont have ceos with military background have such a dearth of military vet service people. In general it is just an awareness issue. I think they dont recognize how much talent is out there especially the last decade. I think the awareness is starting to build. Jp morgan hired 7,000 veterans in the last two years. Kw think it is getting to be a sweep and shows like yours and your advocacy for veterans is really helping. Thank you. I know my dad will appreciate it. Lets talk about the amazing transformation you made with clorox. You have consistently gotten the most out of your products, 5. 2 to 5. 5 revenues. Stock has doubled when you include dividends. How is it possible to double the value of a stock without having 20 to 30 revenue growth. One of the things i started when i got there is we had to increase the dividend in double digits. I wanted to get more cash back to shareholders. One of the things interesting about clorox is it has tremendous cash flow. We wanted to get more of that back to shareholders. At one point we were almost 3. 7 yield. When you look at the treasury of about 2. 25 we became a really nice bond, if you will, a really safe bet. We werent turning out about 2 buying growth. We hit a snag last year. 3 currency neutral revenue growth. This clorox isnt just a cleaning liquid. I use this analogy in our company what aspirin is to analgesics bleach is to disinfecting. It is a wonder product. The last 100 years it has been in our water system. The interesting thing about bleach is that organisms cant adapt to it. It completely destroys the cell structure of bacteria and viruses. When i went to the cdcs website to see what worked against ebola, it is your wipes and your liquid. If you look at the cdc guide lines it says any epa registered disinfectant would be effective. Have you seen a spike in sales at every hospital . I know it has been consistent since h 1 n 1. In the quarter we finished we didnt see a bump. The Media Coverage didnt start until mid to end of september. You see a bump. Some of that is the normalerchm you have said because of your social media and analysis and incredible interest in where the customers are you were able to ship clorox. Ment. Its interesting. We do look at social media. We look at tweets. We look at facebook. We see where the incidents of chatter about disease is highest. And then we will actually allocate shipments into those zip codes. Stores that are in those zip codes. We have done that with walmart and other customers. You have shown a bit of savvy that i sometimes wish our government had. You recognize that venezuela was a failing country that you couldnt deal with. Youre the only executive that has taken the tough decision to do that. Why did you do it and why havent others . About three years ago the government put our products, most of our products under price controls. Of course, when inflation is running at 60 to 70 a year what 457enned is our margins went from about a 35 to 40 gross margin to negative territory. We started losing tens of millions of dollars. Last year out of a business of 75 million we lost 23 million. This year we forecasted we would lose a little bit less. The government promised us pricing. We met with the government 20 times between july of 12 and july of 14 telling them how bad our business situation was. We wrote them about 100 letters to various government officials detailing what was going on with the business. We wanted to stay in venezuela. We had been there almost 25 years. Got to the point where the losses were so significant we could not take it anymore. We had been promised pricing in june and thought it would rectify the situation that pricing never came until september. You are always making the tough decisions. Proudest moment. This will be your last time with us as ceo. I think really its the cultural change we have done at clorox. We took a group of brands and put it under this health and wellness umbrella and made our brands relevant. I think i am proud of the culture, how it has evolved to a peoplefirst culture. I kind of said to our number of investors our shareholders are not our most important constituency, its our people. If we dont have the best and brightest engaged 110 our shareholders not going to be happy over the long term and consumers and customers. That is something that came out of the marine corps for me. It is not about your people but all about you. Everyone is pretty thrilled. You did a great job. Fantastic. That is don knauss, a captain who served and chairman and ceo of clorox who did a fabulous job. Mad money is back after the breakism. Captain daniel sears. I would like to wish a happy veterans day to all of our men and women serving overseas and at home. Im corey jones from houston, texas. Happy veterans day to all of my fellow service members. Thank you for everything you have done and everything you continue to do. Special shout out to my family. [ cheers and applause ] it is time. Its time for my special veterans day edition of lightning round on mad money. Play this sound and then the lightning round is over. Are you ready . Time for the lightning round. Lets start with you, sir . How is it going . Dylan from new york, new york. Keryx up and down. You have to handle that on your own. U. S. Army, for a military veteran living on military pension do you think intel is a solid stock . I think it is under rated by most of wall street. It has great balance sheet. I say yes to that one. Sir . I want to know your feelings about General Motors . I think General Motors is a stock my Charitable Trust is stuck in. It is just too difficult to own. I will not wish it on anybody else. You think ibm has bottomed out . I think you want to sell ibm. I do not trust the stock and i think management does not know what to do right now with the business. Quick question for you. Big booyah from west point to you. Line energy. I think it is too risky. I dont like the fact that you have so much exposure. I would say no. I say kmi much better. I like the yield. Michael mcgovern from fairfax, virginia. Its a strong buy. I also like general dynamics. Hi, jim. My question is about ultra. They have seen a decline. Im going to say it is time to take profits in that stock. I think growth has been taken. If i want yield i will go back. I held west port innovations for a while. Where do you see it going . They have overpromised and under delivered. That is no longer the status you want to be involved in. Do not own that stock. What do you think about Proctor Gamble . I think it has moved up too far to 89. Three points up and five points down. No longer the level i want to be involved with. I prefer to buy merck. What is your opinion on caterpillar . I think caterpillar spends too much money be invested in china. I do not think right now is the time to buy cat. If i can get it below 98 then i will. Pull the trigger. That is the conclusion of the lightning round hello. We are coalition of sailors against deinstrustructive decis happy veterans day. Welcome back to our mad money salute to the troops special. Now that the price of crude is coming down it pains me to follow the coverage. I find it gut wrenching because so many seem to have no idea of the gradations, the difference between the scales and budgets. Treating the Oil Companies like a big undifferentiated mass. So the stocks from the commodity they deal with where one barrel of oil is pretty much the same as the next. That is just not true. First the companies have different strategies. Majors like exxon and chevron simply cant change on a dime. They need to think of Production Growth from 2019. Maybe the majors wont bid on expensive projects in the future but they dont really want to cut their long Term Investments because they are trying to generate Production Growth in the outyears since they wont be able to sustain business without it. The major independent oils, the well run Companies Like eog, noble energy are all led by very smart people with their finger on the pulse of the huge shale discoveries in this country. They are nimble and dont have global ambitions. These companies tend to be the most forward looking in terms of embracing technological advantages. The independents have been extremely savvy when it comes to paying for the acres. They know the territories, know where and where not to drill. The issues of the past are not a factor. That is why it is hard to pin down the cost per well. Then you have a company where plunge in oil prices from 177 means a lot less. Earnings may be impacted if oil stays down over the long term. However, these oil execs are so much smarter than the press makes them out to be. Most never trust them with the day to day price of crude to begin with. They care more about volume than price. As soon as they hit their hedge. Independent oils arent about playing commodity markets. These companies hate rolling the dice. Consider the independent oils like growth retailers. They care about same store sales getting more out of each existing well and care about growth and then hedging immediately to lock in decent pricing. Those are why earnings are so strong and will stay strong next quarter. Finally the third kind of oil company that got in late, paid high prices and didnt hedge well and took a lot of debt betting the price of crude would be high when they brought their oil to the market. The house of pain. These are the ones selling off properties to pay the bills to raise cash that dont really work. I do not trust these companies. Many of them are below 2 billion in market capitalization. They worry me. Once you recognize these gradations you can understand why simply trading the oil stocks is pure tomfoolery. When it comes to oil packs the difference between making money and losing money in the 77 level we find oil. Theres confidence. Then theres trusting your vehicle maintenance to ford service confidence. Our expertise, technology, and high quality parts means your peace of mind. Its no wonder last year we sold over three million tires. And during the big tire event, get up to 140 in mailin rebates on four select tires. What if we finally had that would be amazing. Hey, what if we took down this wall . What if this was my art studio . What if we were preapproved . Shut up from finding to financing, howd you do that . Zillow. receptionist Gunderman Group is growing. Getting in a groove. Growth is gratifying. Goal is to grow. Gotta get greater growth. I just talked to ups. They got expert advise, special discounts, new technologies. Like smart pick ups. Theyll only show up when you print a label and its automatic. We save time and money. Time . Money . Time and money. Awesome. Awesome awesome awesome awesome all awesome i love logistics. We encourage long term investing. That is why we are highlighting disney which you can own and i think there is a great earnings projection at whole foods which to me is a really interesting turn around target that is still down a lot for the year. My deepest thanks to all who have served and are serving as well as veterans who joined us today and men and women of the United States military academy. You need a reminder we live in the greatest country of the earth . You are looking at them now. Im jim cramer and i will see you tomorrow. [ engine revs ] hi, everybody. Welcome to jay lenos garage, though this week, were not gonna be in my garage. [ indistinct conversations ] were on our way to pebble beach, the ultimate car week. Now, pebble beach is kind of like the super bowl for car enthusiasts. Youll see some of the greatest cars ever built. Well take you to concours dlemons, where youll see some of the worst cars ever built. Well show you an exclusive look at a couple of supercars being built, and were gonna show you a car that is 50 years old but is being built by a major manufacturer exactly the same way it was 50 years ago. That a Business Plan . I dont know. Well find out. But right now, lets go back to the beginning. Were gonna take you for a ride in a 1907 white steamcar