Transcripts For CNBC Mad Money 20161214

Economy is pretty good. Good enough to raise rates by more than we thought. The market endured a mild selloff. Dow breaking a sevenday winning traek. Nasdaq declined. Instead of getting destroyed. Come on. Head to the 2,000 point run weve had to the election its peanuts. I think we can admit weve been due for a bit of a selloff. We didnt see a wholesale slaughter as some people expected. Given the rare heights we got to. This kind of pull back, to use a word people hate to hear in relation to a loss, healthy. Its an extraordinary time but not so extraordinary that we can keep rallying after through and through the rate hike. There was a brief moment where the market cheered the hike. Minutes after the 2 00 announcement and the dow looked like it was going to pierce the 20,000 mark. The bideuyers stormed the rampa were thrown back by profit takers. Who seemed motivated by desire to lock in. Rather than a need to bail on the entire market. You know what that relatively gentle selloff means after the run . Down 100 doesnt sound gentle. It means we may be get back to normal. We might find ourselves focussed on companies again and how they are doing. Whether they should be based owned on their perspectives. I cant stress to you how important, how seminal this normalization is. For as long as ive been investing weve had to Pay Attention to what the fed is up to. There are times when the fed can crush any rally. Or even the entire economy, if it takes rates up too much. As we saw with the 17straight rate hikes before the great recession. To ignore the fed, moronic. The fed raised rates by a quarter of a percent and the market got clobbered. It was clear neither the economy nor the stock market was ready for the hike. The Economic Growth was so uncertain the outlook so cloudy it seemed totally out of sync with the moment. Now here is the irony. Fed chief janet yellen gave a press conference. Sure enough, the Economic Growth is uncertain. Cloudy, even. This time its not about being too weak. Its about being too strong. This time its about whether president elect donald trump will get the economy so hot with this business regulation troika goodies that janet yellen will need to worry that the that gradual and sporadic rate hikes may not be enough to keep inflation in check behind the curve, so to speak. She laid out a forecast of not one, two, but three rate hikes for next year. Last year that kind of talk obliterated the market. We were in a weak holiday season. Oil and gas rolling over to the point where it seemed like 300 billion in debt was at risk. We had worries that housing would be crushed by any further rate hikes. The house of pain this time we said, yep. This time it makes sense, rational. The economy is Strong Enough that we need to go back to higher rates like we used to when business was good. Something in the 2s or 3s or maybe even, if trumps gambit pays off. Maybe well get 4 growth. Traders hung on yellens every word. When they stated the need for the rate hike as well as additional increases came out, the banks led the further charge to the dow at 20,000. When she spoke about tightening in a measured fashion because the economy is strong but not that strong, it seemed to close the door on four rate hikes by caused the banks to roll over taking the labor market with them. When she said it did exactly was it was before the recession we had another blip up. Four rate hikes. The 20 k people then reared their heads. At that point the fed reporters couldnt help themselves. They went all trump. They asked whether there is a rational exuberance, a reference to Allen Greenspan who said it might be up too much in 1996. I was waiting for them to say, miss yellen is marka or they didnt go there. Yellen didnt take the bait. Not the first time, second time or third time. Finally she gave in and gave us the comment about things being murky under trump. I think the real takeaway is simple. We had the big, bad eventme. All the rate hike did was ratify what we already knew which is that it was time to raise rates because the economy is better. The more important question to me is whether the trump rally will now take a breather. We expected a rate hike. We ran up into a rate hike. We got a rate hike. Now what do we do . Earlier this week i suggested we rally and rallied and rallied. Since then the trump rally has been on the back of the president elects multitude of probusiness cabinet picks. But remember what i said about feeding the beast last night . Unlike trump, yellen is no beastfeeder. She is not trying to stimulate the economy. She doesnt want it to get out of hand. Trump, on the other hand thinks this economy is more weak than yellen does. He is still saying that Business Needs help, but not from the fed, from the white house. In fact, we saw him met with tech leaders in trump tower who are responsible for more of the economys growth but also much of the automation that causes job losses. He was incredibly encouraging he wants more growth. Why does it matter . It looked like a room full of people who voted against him with many raising big funds for his opponent. Plenty of traders were concerned the meeting could turn real antagonistic real fast. Didnt happen. Trump was gracious, telling the tech ceos they should call him or gary or wilbur. Meaning the soon to be tech adviser chief or wilbur ross. Thats a different attitude towards business than barack obama. Its hard to imagine him getting buddy buddy with a room of billionair billionaires. Suffice to say trump did enough to feed the beast. Then we reverted to thinking about the upbeat meeting instead of a downbeat scolding. Then we got another wave of profittaking. All just rational. Bottom line. It was another day in the office, which is pretty darn good when you consider it might have been a tumultuous day. Call it what happens when things get back to normal, at least as normal as they can be with this president elect. Alex in my home state of new jersey. Alex hey, jim. I love jersey. Whats happening . Considering the evaluation of the markets, the s p shedding out more than 18 times forward earnings. You think the more immediate negative effects of a hawkish bet are factored in . I think that in the end you have to keep feeding the trump beast. As long as trump stays upbeat and has more things up his sleeve the market will go higher, maybe even to the inauguration. If we start thinking about the higher rates and stronger dollar well get a selloff. We call it animal spirits. Its what drives a stock like nvidia up 5 bucks on nothing new other than another buy recommendation. Bob in new york. Bob jim, during the massive trump rally, visa failed to participate. As far as i can tell, the fundamentals have not changed and visa europe is poised to make a major contribution to earnings. Whats holding them back . Great question. From the old days, this is a very interesting story. Here is whats happening with visa. When you look at a stock like visa or mastercard you see what we call faux bank stocks. They are being sold to go buy the stocks like bank of america and jpmorgan. People suddenly want that Interest Rate boost. So visa absolutely business is strong. Got another recommendation today. But if it starts running youll see more sellers because they want to be in the banks. Jonathan, in texas. Jonathan. Hello, jim. San antonio. Holy cow. Tim duncan. Wish he had been at the thing the other night. Fedex and ups are struggling to keep up with holiday orders, should i buy them on the idea that they have large volumes, should i expect them to go down since theyll probably need to hire lots of temporary workers or skip both and buy a maker of the shipping boxes Like International paper . Someone on twitter asked me this. International paper had a big run. I was concerned today when i read there is so much traffic that it may be hurting these guys. The way the structure works. Fedex is actually able to handle or has been historically i dont know ups is a really good company too. Both great companies. Theyve handled the traffic. You know what, maybe the best thing to do is buy amazon. I call them as i see them. I am an amazon prime guy. I love fedex and ups. I think theyre good but theyve really run. How about mike in texas. Mike hi, jim. Thanks for taking my call. Absolutely. I am newly retired and rely on Dividend Income from my equities. Ive recently been looking to purchase more stock in the southern company. And i was wondering if this is a good time to buy more or should i wait for an additional eight to ten percent pullback . Southern is not my favorite because it has a little bit of actual risk to its business because of some overruns. 4. 62, i think you should wait until 5 . When we bayou tilts we dont look at the price of the stock. We look at the rate of yield. At 4. 6 when it gets to 5 . Its okay. A new world order, people. Today could have gone worse. Trump fed the beast enough so that we just saw a rational, relatively gentle selloff. Tonight, for a month ive been eyeing names like the benefit from the new world order that is the Trump Administration. Trump stock. Trump stock. Trump stock. Tonight i am bringing you the ultimate trump play. Ill reveal it just ahead and then im calling an audible a la Peyton Manning. The company that could be calling for a big possible takeover. Trump talked about Infrastructure Spending, rebuilding a ball and rebuilding americas roads and bridges. What could it mean for a company like u. S. Concrete . Im asking the ceo. Stick with cramer announcer dont miss a second of mad money, follow jim cramer an twitter. Send jim an email to mad money cnbc. Com. Or call us at 1800743cnbc. Weve been hunting. We spent more than a month now searching for names that will benefit from the new world order that will be ushered in by the Trump Administration in partnership with the totally gop controlled congress. Tonight i want to introduce you to what i believe could be the ultimate trump stock. Trump stock. Trump stock. Trump stock. Ctas, the company you go to when you need to buy or rent uniforms for your employees. As well as things like first aid, safety, Fire Protection and cleaning products. The core of the story here is very straightforward. When companies, particularly manufacturers but also service businesses, hire more people, they need more uniforms. And cintas makes more money. So, if you, like me, believe the triple whammy of lower Corporate Taxes, deregulation and the repatriation of overseas assets will provide a big boost to employment here in the united states, then its easy to see why cintas would be worth buying. The stock has been roaring since the election. I think after postrate hike profit taking it could have more room to run. Not only is it the qui quintessential trump stock, it recently made a Game Changing acquisition. Put it all together and you have a lot of ways to win. You need to know that theyve been a winner for a long time. A great stock you never heard up. Up 32 year to date. Rallied 69 over the last two years. It has more than quadrupled over the last five years, trouncing the s p 500 during all those time periods. Since the election its surged up 15 for 105. A 14 gain as its been right at the front of the trump rally. Its not like cintas has been going higher for no reason. Weve added millions of jobs since coming out of the great recession, which has been fabulous for cintas. In the most recent quarter it grew sales at 7. 9 clip which translated into a 35. 5 earnings growth. Business has been good and organically i think its about to become a whole lot better. Cintas is the number one player in the uniform rental space. It has a fabulous management team. The son of cintas founder. Most of the executives have the majority of their net worth invested in cintas stock. Theyre on the same page as you in short, theyre less motivated by salaries or bonuses than by wanting to get the stock higher. Theyre gigantic stockholders themselves. It was performing at a very high level before but now it could have more upside for trump and nontrump related reasons. I dont think a quarter fed rate hike will hurt the growth. I think multiple rate hikes wouldnt derail cintas. Why . For starters the uniform rental business is highly fragmented. Its right for consolidation. In august it announced it was buying gnk services. The next closest competitor, for 2. 2 billion. And a month ago gnk shareholders approved the deal. Cintas has had many years of organic growth but this acquisition could give them a major boost. Once the deal closes, the combined company will have more than a million customers, plus cintas gets more Processing Capacity and the roots become more dense, meaning, when they send out the trucks to deliver the uniforms to the clients theyll be able to make more stops and do things in a more efficient manner. Altogether cintas expects it could realize 130 million from annual synergies from the deal. But really all you need to know is that, when this deal was first announced, not only did gnk stock rocket higher, of course. Theyre the target, but even cintas, the acquirer, rallied more than 5 . That same day and that is a rare thing. Buy, buy, buy tells you wall street is salivating for this deal. The analysts keep cheering it on as well. They accept this they expect the merger to close in the Second Quarter of next year. While i never had antitrust concerns, i think trumps regulators will be more friendly than obamas. Trumps agenda will produce a pickup in growth. Janet yellen said this today. This is the kind of company that will make a killing if that happens because its whats known as a shortcycle business. I spent a lot of time since the election talking about how the cyclicals have been on fire, but there are many different kinds of cyclicals. A teaching moment here. Right now i want to focus on the difference between the shortcycle businesses and the long cycle businesses. A long Cycle Company takes a while to ramp up production and the goods have complicated production processes. Boeing, the classic sxaum exampa long Cycle Company. While those types of Companies Benefit from a stronger economy, it takes longer for the benefit to flow to the bottom line. Cintas is obviously not an industrial. But if they want to supply more uniforms, they can they make that decision in a heartbeat. And more importantly, most of their customers are the kind of shortcycle industrials that can ramp up production quickly and thus really benefit from a stronger economy instantly or just the expectation of a stronger economy. Since cintas is there for the supplier for the short cycle industrials its centered as short cycle business do. Say you own a factory and you want to make more widgets in the u. S. Because you expect tax reform and deregulation will give the economy a boost and youre worried trump will punish you if you try to move your factory overseas. If this widget making expects a pickup in demand, theyll need to hire more people, right . And order more uniforms and cleaning supplies from a company like cintas. For many industrials, their whole manufacturing workforce is outfitted in cintas uniforms. So its a great play in an acceleration economy. The market run is saying a run is what well get thanks to trumps agenda. Longer term, if you think trump will be successful at keeping companies in the u. S. And encouraging new oil and goes projects like pipelines, thats even more business for cintas. The only International Exposure they have is to canada which is only 8 of their sales. You dont need to worry about a potential trade war with china or threats to repeal nafta. We are using a prism here. Has to avoid some of this not a trump stock. Issue. Trump will be an America First company. And cintas is an America First company. Last year their tax rate came in at 32 . If trump cuts the Corporate Tax rate to 15 , cintas becomes more profitable. The bottom line, cintas has been doing great for more than half a decade as the economy bounced back from the recession. I expect the company to do even better thanks to president elect trumps probusiness agenda and i wouldnt be surprised if the stock after the current consolidation resumes its long march higher. I am taking a cue from Peyton Manning and looking downfield for open plays. Could zylinx be a take. Im going to ask the ceo of u. S. Concrete, big trucks going around and around, what it means. Im eyeing one company to help you cut the cord on your desk phone. Stick with cramer on a day when the market took a breather courtesy of the rate hike from the fed and the promise of three more next year, its worth taking a moment to think about how we analyze stocks that have run. I expect the rally will resume in the future. When i see something roaring i ask, is it, a, a trump stock or a reevaluation or the animal spirits in the market or a potential takeover. Thats the prism i use with stocks that have been rocketing up. Sometimes i feel a little like Peyton Manning, who after a few random omaha screams takes the snap, checks down the receivers to see which one is open. The best receivers, the one with the most separation, are those with the trump triple threat. Trump stock, trump stock. Theyve got winners from deregulation, theyre benefiting substantially from lower taxes and will repay treat a treasure hoard. Apple is the quintessential play on all these three. Antonio brown. Others will do well in a lower tax world. When you go through the checkdown you hit a huge part of the s p 500. Thats why the animal spirits of the market have been so vibrant. Its why so many stocks are indeed trump stock and there arent that many of these. We cant overlook the gyrations of individual stocks. Lets talk about xilinx. They make Programmable Logic devices. Chips that can be reconfigured by the customers. Its not a fab company. Not a big factory company. The stock has been en fuego. Its responsible for so much of the Technology Behind the videos you see on your cellphones. Though it is not a cellphone play per se. Its more a play on telecommunications equipment, the service providers. Right now there is an arms race going on in this industry about who can offer and deliver the best video. You may need xilinx to stay up to date. The chips have so many internet of things applications from automobile infotainment to defense where they have remarkably proprietary exposure to the data center. These places are loaded with xilinx chips. Now, xilinx goes head to head with alterra. Theyre the only two players in the scale of this Programmable Logic business. Last year intel bought alterra for 16 billion to increase they are data center exposure. When i see xilinx spike i do the Peyton Manning triple threat che checkdown. I spot an open man, the takeover potential. I think, yes, that could be whats going on. Any Semi Conductor company that needs to diversify away from cellphones could snap up xilinx and immediately get diversification. Just like qualcomm is doing with its acquisition. I never recommend a stock on a takeover basis but this one is significant. There has been so much takeover activity in the Semi Conductor space, Analog Devices snapping up linear tech. You have to wonder what texas is up to. Its been six years since Texas Instruments bought national semi, which was a brilliant move in retrospect. I think xilinx is a natural target. Sky works badly needs to diversify away from cellphones, code for apple. Even the 20 million my cron, the overdependence on d rams and flash memory could make it an acquirer. All these companies could handle buying a stock like xilinx which is still one more reason why i think its a great trade. Dan, in my home state of new jersey. Dan hey, mr. Cramer. Whats up . I love the show. Thank you. First a shoutout to my boys and my economic teacher mr. Davis. I love mr. Davis. He is dynamite. He is. I am a Young Investor and brought into amd when it was around four. Now its around 10. Is it time to cash in . I still like the company. Its reconfigured its Balance Sheet when the stock was at 6. 4 to 10. Bulls make money. Bears make money and hogs get slaughtered. Take out what you put in and let the rest ride because you be playing with the houses money. Dave in illinois. Dave dr. Cramer. Happy fed rate day. Go take a hike. I like that. Better than jumping in a lake. Whats up . Jim, recently intel has created a new division. The automated driving group. Right. Expects aton mus vehicles to be a core component in the world of the internet of things. Autonomous drive system suppliers have signed on to use intels core true. Next generation chips. I know its advisable not to chase nvidia but how about intel . Intel is like secretariat. What a great horse. Nvidia is like american pharoah, now a great horse. Calling an audible could help you find a solid company. Best stocks have the triple threat going. Go through the checkdown. There it is. Xilinx. Much more mad money ahead. The u. S. Mexican border is 1,590 miles long. The wall would require three times as much concrete as the hoover dam. I talk to the ceo of u. S. Concrete. The days of being chained to your desk to make calls, guess what, they could be numbered. All your calls rapid fire, during a very special edition of the lightning round stick with cramer we need to be ready for whatever weather may come our way. My names Scott Strenfel and im a meteorologist at pg e. We make sure that our crews as well as our customers are prepared to how weather may impact their energy. So every single day were monitoring the weather, and when storm events arise our forecast get crews out ahead of the storm to minimize any outages. During storm season we want our customers to be ready and stay safe. Learn how you can be prepared at pge. Com beprepared. Together, were building a better california. Its hard to say what will actually happen once president elect donald trump gets sworn into office on january 20th. We cant know what hell prioritize or which parts of his agenda may be opposed by the republicans in congress. He has been outspoken about the need to beef up Infrastructure Spending and if, like me, you believe the plan to fix our roads and upgrade the airports has a good chance of being passed, there are a whole host of stocks that deserve to go even higher. U. S. Concrete. Uscr. A major producer of concrete for commercial construction, Residential Construction and infrastructure building. Its rallied 30 since the election. It will benefit from the infrastructure agenda. Its the kind of company that does a whole lot better when the economy picks up speed. Something that pretty much everyone is expecting. Including janet yellen. Could the stock have more room to run . Lets take a look at an Exciting Company with the president and ceo of u. S. Concrete to get a better sense of how the company is doing. Welcome to mad money. Thank you, jim. Phil, i know that a lot of people think, including me, that concrete is concrete. There is nothing special about it. When i look at the jobs youve done i did a special called ground zero rising. You were the key guy when it came to the world trade center. Thats correct. Concrete is differentiated. We choose to operate in urban environments and get a strong market position in those environments with significant barriers to entry and do projects within those environments that nobody else can do. The world trade center. 49ers stadium. You did that beautiful stadium . Yes. Wow. You were on site apparently right after 9 11. 2001 i brought a hundred pieces of equipment from my Previous Company and assisted in the cleanup for the first three days after 9 11. Its our concrete thats rebuilding the trade centers. Its amazing. From someone who has been down there, it has to be one of the biggest concrete jobs in the world. Its very big. Looking at where you are. Youre in new york, which i know is a hard market to work in typically because of zoning rulings. Youre in california, in the climate best places. But texas stands out as being an unbelievable place to do business right now. Dallas is booming. The decline in oil prices hasnt affected dallas. The number of corporate relocations in dallas is outstanding. The toyota headquarters project was ours. State farm insurance has moved down there. Liberty mutual has moved down there. The inflow of people and all of the building needed to support the people has been fantastic. It looks like the next two years will be just as strong. What are the metrics we should watch for your business . Taxes like new jersey with the road tax . Corporate relocations, or Something Like infrastructure from the new president . All of the above. And speaking of the Trump Presidency, the infrastructure plan that was in his platform of 1 trillion. Well see how much of it comes to pass. Combine that with very favorable Corporate Tax rates and a favorable regulatory environment, with an economy that was doing really well for us before, that we have a lot of wind in our sails at this point. When a president obama first started his big, you know, big bill that was supposed to stimulate the economy. Stimulus bill. There was a lot of criticism. But there was no such thing as shovelready. Are there such a thing . I would say it was overplayed. These things take a long time to plan, permit and execute. Even the trump infrastructure plan, i would look for the effects to be in the out years. Thats important because a lot of people are pretty excited. At the same time, when you get Something Like a gasoline tax, like you like new jersey, it seems like its pretty rapid to seed business. Its pretty rapid. Were assessing the Trump Presidency to be we were in the middle innings of the last cycle. Now what were planning on is an extension of that. So maybe we had a two or threeyear runway. Now we are looking at three, four, five, six years of improved economic opportunities. Thats great. Janet yellen raised rates today. Mmhmm. We got. 25 point increase. Thats not the type of thing that would derail a business like yours. Not at all. First house i bought in 84, the Mortgage Rate was 16 . If i look at whats going on around the other parts of the country, you have other areas that are interesting but it seems like you get into an area and you buy other guys, they all do Different Things . Yes. The common denominator is concrete. But they have their own niche specialties. Residential, commercial, infrastructure. And we incorporate them into our business model. In new york city we have 17 concrete plants and over 400 concrete trucks in the five boroughs. We look for areas of the country to operate in where nobody else wants to operate in. Look at the traffic, the congestion. Were all union in new york. You can still make money . You can make more than good money because you have a Compelling Service and delivery model that nobody else can replicate. Therefore you can get a premium on that for the shareholders. One last question. It is talked about a lot. The wall. The wall in mexico. Is that the type of thing, when you first heard it, you said i want a piece of that job . Or was it much more of a, lets say, boasting, maybe that doesnt happen because, remember theyre supposed to pay for it. I dont want to speculate on that. We have portable plants that go around the country to take advantage of any opportunities, if an opportunity arises, well be competitive. I know the president does make phone calls. Perhaps you should put your number underneath here. Great work on the world trade center. I know from ground zero rising how special that job was. Thank you. Bill sandbrook, president and ceo of uscr. Mad money back after the break. Announcer lightning round is sponsored by td ameritrade. I called about six weeks back. I was on the show asking about Public Storage psa stock. I remember your call. Yeah, you said it was because people were jumping ship. 3 . Not good enough with the imminent fed rate hike. Now we got it. Is the bandaid ripped off or does it have lower to fall . It yields 3. 7. It has lower to fall. You have to get a new shirt, by the way. For the record. Okay. I mean, its okay. I know its casual friday. Except it happens to be like wednesday. Yeah. Im sorry. Maybe i am just old school. But would it kill you to put on a collared shirt before you call me i have a lot of fun talking to everyone today on Facebook Live taking questions about the fed decision and a lot more. This thing was big. We got to do more of them in the future. If you want to see what its like to be behind the scenes here, i actually introduced some of the people and kyle. And now, now it is time it is time for the lightning round are you ready . Time for the lightning round. John in california. John hi, cramer. Yo, yo. What do you think of kkr . Oh, i am a believer. I think its good. We have a market that wants to do some ipos. We need new ipos. Kyle in virginia. Where do you see cintel in a year . I dont know. Thats a regional play. I have to do work on that. I like at t and verizon but its not the same business. I have to do some work. Gino in florida. How are you tonight, jim . Im good. I enjoy your show. Watch it and tape it every night. Oh, thank you i have a question about opk. I know dr. Frost is one of your favorites. He is. He seems to have slowed down buying his stock. Its trading kind of crazy. I tell you, gene, i have been sticking with it from the low Single Digits to the mid. Came back into the acquisition. But i like it. Its a money maker. I believe in their tests. I think theyre very good. Vera, i hope im not mispronouncing it in colorado. Hi, booyah. Booyah. My question is about kimberly clark. I was wondering. I have always thought of it as a bit boring. And i wondered what your thoughts were regarding dividends in kmv in general . It was up 38 cents and now its down because its a bottom market equivalents and people dont like to buy those when the stock market is going up. Why . Because the bond market is offering a safe return with a lot less you know, put it this way. Kimberly clark is are struggling because of the tenyear treasury. It will continue to struggle. Until they blow out the numbers people dont want to own it. Great longterm, though. Dan. Great to talk to you, jim. Visiting here. Home town in connecticut. I am interested in your views on a stock thats had a rocky road recently, namely novartis. It has. If you want a stock thats down a great deal that may be bottoming, i would go with allergan. Everybody has given up on it and brent saunders. I think thats a mistake to give on what i believe to be the bottom or within ten points of it. Joshua. Yes. Keymar cc. Its lightning in a bottle. The stock was down at 3. Up 24. Up 363 . I would say, late to the party. One more. Sharif in florida. Hello from tallahassee. Thank you. I am a huge fan. Thanks a lot. What do you think about dqr. I think you should be in fang. Diamond back energy did an offering tonight. You should buy that one. Thats the lightning round announcer the lightning round is sponsored by td ameritrade. Thats a great idea, but why dont you just go to thinkorswims chat rooms where you can share strategies, ideas, even actual trades with market professionals and thousands of other traders . I know. Your brain told my brain before you told my face. Mmm, blueberry . Tap into the knowledge of other traders on thinkorswim. Only at td ameritrade. Thats mad money for this thursday, have a great weekend, everyone. Weekend . Why did he say weekend . Its thursday. Booyah, jim. Booyah, chief. Have a good weekend. Weekend . Fabulous show. Have a good weekend. You know me. I am always on the lookout for the next gamechanger, the next piece of Disruptive Technology that could revolutionize an entire industry. Through all this incredible innovation, your office probably hasnt changed one bit. The phone is still the same. Most people are still tied to their land lines at their desks. Me too. Maybe if youre lucky you can forward the calls to your smartphone. Setting that up may be so frustrating that it makes you want to tear your remaining hairs out. Which brings me to dial pad. They developed a cloud based platform to turn any device into your business phone with voice, video, instant messaging and online meetings. Why should a a business shell out a fortune for a teleco system when the employees have mobile devices that are more sophisticated. They amassed 25,000 paying customers. Theyre not the only company doing this. I think its pretty exciting. Lets dig deeper with craig walker, the founder and ceo of dial pad and learn more about how his company is trying to revolutionize the way we work at the office. Welcome to mad money. Thank you for coming on, craig. I have this device. Can i replicate what you do by downloading a lot of different apps from apple . No. You basically want to replace your business phone system with that. So you need to have the dial pad service. We would run an app on there. Then that endpoint or your laptop or tablet is the same as what you get sitting at your desk. Your Company Signs up for dial pad. You mentioned moattorola. They did it. When a new company starts, do they even still go to land lines . Some actually do. We have new companies, uber is a newish company. They went straight to the cloud because theyre kind of valley and cloud based. Other companies have a pbx theyve sat on for 10, 30 years. Its time to upgrade. Theyre moving to the cloud. How much cheaper is it . Dramatically cheaper. So with motorola First Six Months they say we saved them over a million bucks. Okay. You are no stranger to this. You work at a company i was trying to think why they do not own dial pad or is part of their, you know, kind of moonshot. You worked at google. Yes. A lot of your people did. You have google seed money. Why didnt this happen at google . I used to work on the google voice team at google, which was the Consumer Product where we gave you a phone number, it would ring on all your phones. We used to go pitch this to google apps customers and would talk to him like, hey, wouldnt it be great if you had this for your business. They all wanted it. It got us thinking, if you are moving your business to the cloud for email and everything else, the phone system should go with it so we left to go do that. You have bigname investors. Google ventures is has a board seeat. Its been a big investor. Its part of the Google Ventures investment portfolio. Andreessen is on our board of directors. Softbank put money in. Big ones. Some of the other features. Fax, call recording, visual voice mail . Call recording. Youre on a call, press a button, it records it. Well transcribe your voice mail to text. How . We do it in 80 languages . We run it through our engine processor and it comes back out as text. Who invented this . A lot of the stuff i mean, this is technologies that now is becoming available, right . Right. So, with the cloud and with the adoption of mobile, it is now the right time to have it all. Now, i grew up on a land line. All my businesses i always first thing i did was try to get someone get a phone. Getting a phone, it was impossible for a long time. Millennials dont know anything about that. I imagine they think the dial pad is what i thought at t was. Millennials, first, they would be shocked if they showed up at work and you gave them a desk phone. Right . They wouldnt know what to do. Mine rang today. I didnt know what to do. Exactly. If they can use their own existing mobile phone and you can message them and call them there, its a natural fit. Sisco, ibm, apple, they must all want to have this. You would think. There will be a lot of interesting stuff over the next few years. You have the space we already built it. The nice thing is weve built a platform before when we were at google. We have experience making really scaleable one. So were already out there delivering. I mean, its the kind of the coveted company my kids would want me to invest in. They think i am so old fashioned. I actually like the phone. Founder and ceo of dial pad. Its private. You cant buy shares in it yet. Stick with cramer. Whats Critical Thinking like . A basketball costs 14. Whats team spirit worth . cheers whats it worth to talk to your mom . Whats the value of a walk in the woods . The value of capital is to create, not just wealth, but things that matter. Morgan stanley okay. After the close, a lot of rumors about craft heinz tying up. When you see these rumors and there is nothing necessarily going on its an opportunity to ring the register. When stocks like that go up i typically dont recommend trades but i recommended xilinx as a trade tonight. I think if you known mondoles and its up 3 bucks on a rumor, thats not an investment i like. Trying to find it just for you right here on mad money. Im jim cramer and i will see you tomorrow. Today when it comes to motor vehicles, there are lots of rules. Were told where to drive, how fast to go. There are rules that dictate design, rules meant to keep us safe. [snores] [engine revving] but tonight. [airplane engine roaring] we turn the world upside down. And we throw the rule book out the window. My wife is gonna kill me. Im diving headfirst into the insane world of sidecar racing. Ill get behind the wheel of a monster truck. Ive done some dumb things on this show, but this is right up there. To fulfill that primal urge to flatten everything in my path. Whoohoo and well find o