Transcripts For CNBC Mad Money 20170509

Index is telling us . I think we have to ask this question on another rather sedate day. So where the heck did all the fear go . And more importantly, should this lack of caution be making us nervous . Lets unpack the situation, next we know the vix measures the level of volatility, that traders are expecting in the near future. Its often viewed as an index of the overall level of fear in the marketplace. Some people think its out of date. Since these days there are many other ways to bet against the market. More efficient ways, frankly. In other words the fear gauge may not be as relevant as it once was. But the vix may not be obsolete. While the s p 500 is much more representative of the broader market. I always mention it at the top of the show, and given that it broke down below 10 today, its a signal that there is a lot les fear now than at any time in a decade. We have to deal with this. Are we right to not be afraid . So a certain degree yes, the market hasnt moved much in ages, and its reasonable to think that it wont. And these intraday swings, it seems like they banned them. When the markets this gentlneg investors start asking if theres going to be a major decline. Why havent there been bigger moves . For starters, the economy is at last healthy, like it was in 2006. Its no longer on life support. Which means we dont need to worry that the fed is going to send us into a recession if it keeps raising Interest Rates as we expect. That was a rational fear for a long time. Central began banks have often crushed growth by raising rates. Now that we have a uniform belief that the economy can indeed handle a couple of rate hikes, maybe they would even be good for the markets. Second, whether you love frump trump or hate him, it is thu that hes the best pro business president. A bunch of important white house positions are filled with goldmansachs alums. Im a goldmansachs alum. Whatever. Maybe you fear that this administration fears labor over capital. And favoring capital means these guys favor higher stock prices, sure, trump could saber rattle. But his bark is certainly worse than his bite, so far. Thirdly, the rest of the world has finally calmed down. Asia is strong, europe is improving, even south america has improved. Fourth, an oil shock which had been a source of volatility many times, now seems out of the question given our own massive reserves of crude. Bringing money in almost on autopilot has eliminated a lot of the massive flows in and ou a that used to cause volatility. Finally were getting through an earnings season where the shocks to the down side have been few and forward between. Lets see, theres ibm, yelp, some oils. Thats really it. That said, none of these successful indications show a lack of fear. For examp i tell my club members that it would not be unusual if we had a selloff. I mean, when you think about it, we have to have a selloff of magnitude at a certain point. I have never seen a period like that doesnt end with something coming out of left field to take us lower, just saying. One things for certain, that the feds going to raise Interest Rates that bonds will become healthy competition. Although if the yeelgz we main at 10 . We may be all honky dory about the fed at the moment, but there may come a time when its movers may promote some atmosphere. Finally, its not like the world suddenly became a certain place. Its uncertain. With an unproven president , a lot of people around the world who wish us ill, both physically and economically. After months and months of little movement, i dont want to say that we dont get any major declines again, that would be rank foolishness. Im pretty sure whatever event does trigger a decline, will not be something you and i have foreseen. I recommend keeping some cash on the sideline. In the end, you have to expect the unexpected. You want to recognize how few people are worried. But consider this. The one thing the vix doesnt measure, for sure doesnt measure s how many hedge funds out there are actually betting against both this market and individual stocks every second and minute of the day. There were so many other times in my career, where the number of large funds with big positions were few and far between. Now i see its the exact opposite. When i see ceos of Big Companies on the air, they like the market. The vast majority i Pay Attention to, heres what theyre thinking, theyre either calling for a crash, or they believe were on the verge of a giant downturn. I think if we had an actual poll of hedge funds, we would find overwhelming negativity about this market, because its too high, the valuation is too expensive. It needs to come down. The hedge funds are probably off the chart office this run. Maybe in the end thats why the market doesnt seem to want to come down big, too many of the big boys expect it too. The bottom line, that expressive Hedge Fund Activity is the reason i can embrace to explain why the big decline has been so elusive. That meaay be the mentality of l the big boys that stabilize on the dip. That may look like the need to buy something, anything, before the move goes back up. Roland in new york. Rola roland . Caller im pretty much a Value Investor and these days its pretty difficult to find some good values out there. One that i came across recently and took a small position in, was kroger, kr, whats your thought about that stock . Kroger needs price inflation, i know costco is predicting that. I dont mind sitting with kroger, its a good company, dont expect anything to exceed price inflation, thats what they need. L lets go to alex in oregon. Caller you featured tellurian, i jumped in, its down about 40 from where it was. Thats tll. How do you feel about that . Look, i think hes a winner. Now the stock has come down, but liquefied and natural gas, its a real business, its a very strong business, and i think suki is a smart man, im not going to go against him. How about kyle in new jersey. Caller jd. Com, they had a great quarter. I have said over and over, and since 90, i think allibabal. Thats a company i met facetoface, and felt very good about their financials, went through back and forth, thats the one i endorse for china alibaba. John in north carolina. Caller go tar heels. I want to thank you for taking my call for the seventh time. I sincerely appreciate it. It looks like the rise of aob and rgr are a short squeeze because they all dropped in anticipation of rgr not meeting cantati expectations. I think outdoor brands is a winner. I have been watching outdoor brands put up big numbers, i have been right some of the time and wrong some of the time. But i have not abandoned it. Too many of the big guys expect the market to go down. But there are othersothers a oil prices dropped, are we in for a crude reality when it comes to crude . I think it is a chart derived district. The chart has the makings of a great short. And can allergans recent rally signify that its down tonight. Stick with cramer. Welcome to holiday inn whether for big meetings or little getaways, there are always smiles ahead at holiday inn. Not too long ago, our stock market was totally hostage to the prying of oil. When crud went up, stock went up, as crude went down, stock wasnt down. The average it seems like crude may have finally figured it out. Maybe they have gotten it figured out that maybe the fluctuations in the Oil Price May be based on supply and demand . What happens if it starts declining into the lower 30s. As long as oil stays here in the mid 40s, were safe, in part because our domestic producers have done better at getting more crude out of the ground more less money. Still we need to know where this is headed. Were going off the charts with carly garner. Shes the cofounder of carly trading, and shes the author of higher probability Commodity Trading because shes got a terrif terrific track record when it comes to oil. After rallying up to the mid 50s last month, it came dawn to the mid 40s, as she indicated it could do. What does she think now that its at the low end of the range . I want you to take a look at this daily chart of west texas intermediate crude. Look at the williams percentage r oscillator down at the bottom. Thats a tool created by commodity trader legend larry williams. According to the r oscillator, the market is indeed oversold. This is an indicator that its down below 30. When crude gets down to these levels, it gets this oversold, garner says its the kiss of death for a bear market. Although oil generally retests its lows or even makes slightly lower lows before rebounding, thats crucial. Garner suspects this time to be no different. So theres a little bit of a breakdown, a little bit of a breakdown. In short, shes betting on another leg down before we bounce, but we will bounce. Oil is supporting the low of 43 if either one of these hold, garner expects it to be right bag to 50. This is how its been for months. Its been down in the 40s, then we bounce right back to the 50s, its happened over and over and over. Garners picture shows similar support level s where she expecs things to turn around. Last weeks breakdown below 46 should pave the way in near term liquidation in oil futures. The one big difference with the weekly price, the relative strength index, and the r oscillator, still have a bit more to go. These are not as oversold as the daily was, both these tools indicate that these could have some negative momentum. But if the price of crude can bounce from the many support levels in the low 40s, garner could see it again rally back to 50, where it would run into the ceiling of resistance. What else do we need to consider . Some traders were trading in the high 30s. And its subsequent rebound point to a reversal in crude, that the turn around is already upon us, but garner has a few reasons to be consistent kl that the bottom has already been seen. Look rat this weekly chart of west texas crude. The cot report. Regular viewers know that this tells us about the net long or short positions of three key groups, the large speculators, meaning Money Managers, small speculators, meaning home gamers and small companies. When the big boys amass a large net long position, it usually means theres pain ahead, because theres no one left to buy, theyre already in. When theyve got a huge net short position, theres nowhere to rebound. Garner says that the large speculator cohort has been bullish no matter what. And even after this recent decli decline, they remain way too bullish. See the line is still way up here. When crude was in the mid 50ss, these Institutional Investors we were trading in the high 40. Garner believes its like ly around 340,000, 350,000. After the recent 10 point decline, you Better Believe these Money Managers are feeling uneasy. And thats why garner believes that crude could have a low point in the 40s. What shes saying is its still going to do exactly what did before. Look at the seasonal chart for garner points to the fact that oil trades the large speculators still have too much oil exposure to say that we can do some real buying. The price of oil is strongly dependent on the action of the currency markets. So a strong green back translates into cheaper oil. This is the dollar index, which tracks the u. S. Dollar against a host of other major currencies, the dollar puts in a weight of 150. Theres the bottom, bottom and up. She thinks that could swing the dollar index up to higher trading and that will also put pressure on the price of oil. Carly garner suggests that oirl probably isnt finished going down, but bunonce it gets to 4 barrel, it should go back up. [vo] when it comes to investing, looking from a fresh perspective can make all the difference. It can provide what we call an unlock a realization that often reveals a better path forward. At wells fargo, its our expertise in finding this kind of insight that has lead us to become one of the largest investment and Wealth Management firms in the country. Discover how we can help find your unlock. Better than a manual, and my hygienist says it does. But. Theyre not all the same. Turns out, theyre really. Different. Who knew . I had no idea. So, she said look for. One thats shaped like a dental tool with a round. Brush head. Go pro with oralb. Oralbs rounded brush head surrounds each tooth to. Gently remove more plaque and. Oralb crossaction is clinically proven to. Remove more plaque than sonicare diamondclean. My mouth feels so clean. Ill only use an oralb the 1 brand used by dentists worldwide. Oralb. Brush like a pro. Hey, its tough to be a short seller in this environment. Just look at the travel space. We seem to have the makings of an ideal short. With airplane reservations experiencing precipitous declines after President Trump announced his ban on travellers from several muslim countries or call it a pseudomuslim band. You had to assume that anything related to it was going to plummet in the quarter. So why not bet against this 250 billion industry, especial. And our markets starved for good short selling ideas, here at last was one with real staying power and it would take you right from april to may, or at least it would look like that. It only got better after united and continentals dragathon occurred. Of course the courts halted both executive orders with al lack contributity, and those who bet against the travel space are on the ropes now with sharply better than expect eed numbers. Take marriott, they reported numbers that were simply incredible. Marriott revealed that it has a pipeline of 400,000 rooms that theyre planning on building, th that stocks flew up to 6 bucks. And then traffic up 7 , lots of positive chatter about on time planes, which is why the board hired oscar munos as ceo to begin with. Munos ran a railroad, now how to get it in on time. The stocks are up about 10 in the aftermath. Mean this wiredly watched incident meant nothing for the some of this could have been predicted. I had the ceo of expedia on the show last week in san francisco. He indicated that business was robust in the last few months. Marriott vacation, you know we love that one, the timeshare spin off marriott had similar comments. Any one of these could have tipped you off that travel is in go good shape. And of course the cruise lines, they have been delivering fantastic quarters. You can argue that all this is just penalty up demand after they dropped briefly. I dont think thats the real story. I think people are spending more money on trips than they are on goods. That money may just be coming out of retail. Travel is as experiential as it gets, meaning its something you can put on your facebook page. No wonder that travel and ease your stocks have been defying the short sellers. That theyre the act right place to be. Lets go to bruce indiana, hey, bruce. Caller thank you for taking my call. I have a question. I have walmart at 57, 18 months ago. Now its around 77. Should i stay or should i sell . Its really up just a little bit, when they cratered the earnings when they said they were going to go deeper into e come. I do not want you to sell it. Caller i bought avp and now theyve lost 60 . Just keep it as a call option or maybe on a term. But that was a sub par quarter so far. The travel industry is robust, experiential and just plain flying high, sorry short sellers. I have a conversation with the ceo of allergen, the stock is up 20 this year. And then xpo lodge gist sticks is behind the sup player chains for costco and home depot. And all your calls rapid fire, tonights edition of the lightning round so stick with cramer. Hes a nascar champion whos shes a worldclass swimmer whos stared down the best in her sport. But for both of them, the most challenging opponent was. Pe blood clots in my lung. It was really scary. A dvt in my leg. I had to learn all i could to help protect myself. My doctor and i choose xarelto® xarelto®. To help keep me protected. Xarelto® is a latestgeneration blood thinner. Thats proven to treat and reduce the risk of dvt and pe blood clots from happening again. 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Tell your doctor before all planned medical or dental procedures and before starting xarelto® about any conditions, such as kidney, liver, or bleeding problems. Youve got to learn all you can. To help protect yourself from dvt and pe blood clots. Talk to your doctor about xarelto®. Theres more to know. Some Companies Just dont get nearly enough respect. Thats how i felt about all le n allergan, reported an excellent Earnings Report today, it had higher than expect it revenue, more importantly management raised their full year forecast for both the top and the bottom line. The companys got a good pipeline, coming in with 13 billion in retail sales. However, allergan stocks sold off hard today, shedding 3. 44. Because of concerns of operating margins and cash flows that some felt were below expectations. Lets talk to the chairman and ceo of allergan, welcome back to mad money. Lets go over some of the things that people heard and said, because i dont think they tell the story, but i want people to understand why a stock went down. First 1. 1 billion in cash flow, many people thought it would be 1. 5 to 2. We did a deal for crisper technology. And we closed take deal. Youll start to see 1. 5 billion to 2 billion next quarter. And the second one was lower margins, because youre struggling to build more drugs here. Q1 was our lowest sales quarter. When you have lower sales, you have lower margins, put on that a little bit of product mix, as we have some higher royalty for products growing faster like linzest and others. That margin should improvprove throughout the year as well. You have this pipeline, lets talk about whats the biggest up in the pipeline, youre in Development Progress for sixstar programs and it could produce some blockbusters. Is thats right. So we do have six programs in r and d that are either in face p three or going into phase three. Theres a novel break through treatment for depression. Huge market, and we really like the profile of this drug for depression, very different than current standard of care. We have a new standard of treatment for amd. We know that was an improvement from four weeks, to six weeks, this could be 12week dosing. So big change. And we finished enrollment in that study. We have our new novel treatment for nash. Very large market, high on that need, and well be moving forward there. And for uterine fibroids, already approved outside the United States and then the first in class drug for diabetic gastrofrere sis. No real new drugs in three years. To me its an insanely large pirp line. But people want to know about the aesthetics, and this stuff could have huge close margins. The aesthetics was very strong in the quarter, its been strong for years now, quarter after quarter as quarter. I felt there was an acceleration, i was upset that the stock went down. I think at aesthetics is just bet rock at 2018. After putting strong growth quarter after quarter year after year. Strong return on botox. Kybella, starting to perform. We now have cool scoping. I want you to talk about this. Because i think this is gigantic. Frankly some of your stuff, i think that people dont know it yet. They do because lots of people are using it. But our penetration rates are so small still. So we have that massive market, but so many potential customers patients out there. And were seeing more young people into the medical aesthetics, people are putting it on snap chap, facebook, instagram. Were seeing males start to move into the market. In fact 30 of all cold scoping patients are men. Which is 10 for botox. And how do people get to that . T do they go to a dermatologist . General practitioner . If anybody googled cool scoping in their city, they can find a whole list of providers. Its available everywhere in the United States. People will be able to download the brighter distinctions app to find a provider. One of the many reasons why i like the company and the stock, because there is a selfie generation. For instance, i would love it if you would buy align, but you guys have soup to nuts for how to look better. And that is something that as we have learned from the line, it gets younger and younger people hear about these things. But im wondering, how are you going to get the worth out . Not just google. Dont you do an active campaign for Something Like this. We do and we get a Multiplier Effect on each of our dollars. Because each office, plastic surgeon, dermatologist also advertises, they advertise on their own dollar or sometimes from allowances from us. Theyre good at social media, theyre good at buying billboards and tv time. We have a very Large National campaign for kybella right now, we have a National Campaign for botox. We are just scratching the surface. That technology works, its a high Customer Satisfaction score. Theres so much here. Brent saunders, president and ceo of aller beg lelerganallerg. I do believe you get a bargain here, its up from the bottom, but its going to have an unbelievable 2017 and 2018. Mad money is back after the break. Welcome to holiday inn thank you wait, i have something for you making every stay a special stay. Holiday inn, smiles ahead. Whether for big meetings or little getaways, member always save more at holidayinn. Com it is time for the lightning round. [ buzzer ] and then the lightning round is over. Are you ready, skeedaddy . Its time for the lightning round. Well start with tyler in arizona. Caller how are you doing . Im a Young Investor in arizona, i have been watching your show every day for a few years. But i also inherited stock in thermofisher. Thermofisher had a phenomenal quarter, i think it can go to 200. Caller booyah, cramer, thanks for taking my call. Im in the basement of the house of pain with rand resources. That natural gas, we need these pipelines to start pumping into the east. If not, its going to the south. I dont want you to sell it, its too low. Caller booyah. I got 125 shares of western digital, my question is what is your price target for action alerts members and when is it time to say sianara . We had a little bit bigger gain, letting the rest run, because i genuinely believe its going to be part of this mix. And thats how youre going to get the next leg. I think selling something is good, no one ever got hurt if they got a profit. Let the rest run. Caller my daughter kendall wants to ask you about a stock. Hi, a texas booyah. My mom and i are calling about kohls. Kss. I think kohls is going to run. So kohls is a buy. Caller can you tell me, and they just reported, can you tell me what you think about m maxlinear . Maxlinear is a winner. I see the numbers are good, its better than expected its not nvidia. Remember what i said about nvidia, there was nothing wrong with the business, it was the analysts and the charters. Same thing with maxlinear. Caller i want to know about ntes. The only chinese stock i will recommend is albalibaba. Caller i have this interest in this company that is in this technology for some time, i picked up some sharings and they had a big jump on earnings and theyre also into this f phosphorus oil technology. Universal display, i started liking it, and im not backing away from it. They can be involved in both samsung and apple. This is just a really, really good company. Lets go to chris in rhode island, please, ris. Caller so my question is on mci, the a tr nrr. Its not an expensive stock and i would be a buyer of it. Lets go to brian in florida. Caller jim, thank you for what you for the small investor. Thats what this show is about, thats who i work for. Thank you. Caller again, my stock is sprint and i know its bumping down against a 200day support line. Right. Caller and i am concerned about whether its going to break through that, do i hold on to this . Do i buy more . It was just okay quarter. I prefer tmobile to sprint. Lets go to john in pennsylvania. Caller a booyah hto you frm newtown, pennsylvania. I want to know what you think of wpg . Shopping centers, its just a nogo. Im not going there, im just not. Lets go to lawrence in missouri. Caller booyah, jim. Thank you for the wonderful work and the wonderful giving that you do. I have a new stock formerly minnesota power, its allete incorporated. I do need to hold it or sell it . Its got a good balance sheet, its a good company, i think you should hold it. That concludes the lightning round. We can share our amazing trading knowledge. 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. In this economy, are the best companies the ones that bring their business to the customer . Xpo logistics is deploying their fleet to haul cargo of all shapes and sizes. Is the boom in Digital Commerce a reason to stick with xpo for the long haul . Lets talk about a stock thats been totally on fire this year, xpo logistics, you know we like this one, its a global provider of Transportation Lodge gisticses services that has already rallied 18 to 20 . Even though the companys sales came in a tad light, they posted a magnificent earnings. Wall street was only looking for 15 kraents. Its been signing a lot of new contracts. In response the stock jumped nearly 8 the next day and its kept climbing, they had a brandnew alltime high today. Lets dig deeper with brad jacobs, hes the chairman and ceo of the company. Mr. Jacobs, welcome back to mad muff money. What we had in that little clip, facilitate nearly 12 million home installations annually. So people should be knowing your company . People who buy appliances, or who buy home exercise equipment, they should know us. And if they are intermodal, that would be your guys. It was a 500 Million Contract over three years. Wow. Okay. You made an acquisition in europe. You said uk, italy, netherlands on fire. Europe turned out to be great for now . Europes done very well because we have a big emphasis on contract logistics. We had the largest efulfillment platform in europe. Were the lead in fashion logistics and food logistics. You talk about how you got in a reverse lodgistics u contest. About 30 of our commerce is e commerce. The e commerce customers buy things and return a handful of them. That logistics is a big and growing business. Now you spent 425 million on technology. Where is that going . I dont think of Trucking Companies as technology companies. We invested in technology right in the beginning of the company, in 2011, 2012. And be able to transmit information thats useful to the customer in real time. How do you do it . Is there some map somewhere . Because i can see youre in every place. So this must be just a massive, massive difficulty to keep track of everything. We have 1,600 it professionals. Its a very strong group. I thought that mna was going to be key, but right now youre reaping the harvest, theres going to be tremendous cash flow and its going to be building and building. We did those two big acquisitions back in 2015. They panned out fantastically. A lot of work went into making them work out well, it didnt happen randomly. Were 90 done with the integration, we still have lots of profit and improvement going on. Well return to the mna market. Maybe the beginning of next year. Youre number one in almost every category and you think business is pretty darn good . Its good, but its not good everywhere. We look at it in two cat guys, we have transportation as a segment. We have contract lodge swris aches as a segment. We have to work hard to get the results were getting, supply chain business is coming to us. Your share is actually increasing, not decreasing. We had 12 top line organic growth in supply chain in europe. Its just a remarkable story, it really is. Thats brad jacobs, chairman and ceo of xpo logistics. Get the largest refund they deserve. One Million People can benefit from precision cancer care. 197 million passengers can fly with less turbulence. I am on my way to working with one billion people. I look forward to working with you. What if we could bring you withby having better values . At blue apron, we work directly with more than a hundred family farms. So instead of spending on costly middlemen and supermarkets, we can invest in the things that matter most making farmland healthier. Cutting down on food waste. And bringing you higher quality, fresher ingredients for less than you pay at the store. Because food is better when you start from scratch. Get 30 off at blueapron. Com cook we said that nvidia was doing well. He said he delivered to data centers, those are the three most powerful areas in tech. Whats happening tonight blow ace way the numbers. Where are all those sellers from 101, 102, theyre probably where the apple sellers were. Theres always a bull market somewhere, i promise to find it for you. Im jim criamer and i will see you tomorrow. Welcome to the shark tank, where entrepreneurs seeking an investment will face these sharks. If they hear a great idea, theyll invest their own money or fight each other for a deal. This is shark tank. With a product inspired by his daughter. My name is travis perry. Im from dothan, alabama, and i have invented a product that allows you to play the guitar instantly. Put that finger there, okay. Now strum the bottom four. Ooh