← Mad Money w/ Jim Cramer
Mad Money w/ Jim Cramer
Mad Money w/ Jim Cramer 03/25/25
00:44:17
Listen to Jim Cramer’s personal guide through the confusing jungle of Wall Street investing, navigating through opportunities and pitfalls with one goal in mind - to help you make money. Mad Money Disclaimer
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- [00:00]
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- [01:21]
Jim Cramer
There's always a bull market somewhere and I promise to help you find it. Mad Money starts now. Hey, I'm Kramer. Welcome to Mad Money. Welcome to Kramerica. Other people make friends. I'm just trying to make you a little money. My job is not just entertain, but to educate, teach. You really figure it out together. So call me 1-800-743CBC. Tweet me at Jim Cramer now. There comes a time when you just don't even want to defend an investment idea anymore. It's just too tiresome, it's too painful. But if you think it's, if you think it's a long term winner, then you shouldn't stop. That's how I feel about the data center story. On a sedate day with dow inched up four points S&B advance points 16%. But then I stick to gain point versus every day I feel like I do battle inside my head, lightning in my head. Worry about whether it's sustainable for tech titans to keep spending fortunes to build out the infrastructure for AI. I worry because of things like what happened Last night when Joe Tsai, the chairman of Alibaba and an executive I have tremendous respect for, talked about the quote, astounding levels of spending on technology related goods, he went on to say, I start to see the beginning of some sort of bubble. This man has great vision. I was sick in my stomach when I read these comments. I knew they'd be picked up all over the place. Because Joe's a well known character recognized for a savvy nature, I figured he could throw cold water on the entire data center gang. And that's exactly what he did. The stocks were down long before the get go as this group trades all early morning. You could just feel it, you could hear it. I was thinking, I don't know, bubble, double, I don't know, trial in trouble, you know, it's frightening, okay, bubble, bubble, bubble. And you know how it just seeps into your consciousness. And that's why I want to retire that word instead. Talk about whether it's a capital expenditure boom, one that might go bust. But it's a boom, it's not a boom. We've had some big capital expenditures booms over the years. Deutsche bank recently put out a truly stupendous piece of thematic research about Capex booms and busts. The report talks about the 18th century canal build out, the 19th century railroad mania, excuse me Apple, the 20th century real estate explosion and the dot com and telecom bubble, all of which ended with incredibly heavy losses. But there are other capital expenditure booms that didn't go bust. The interstate highway system, the Post World War II Marshall Plan, the electrification of economies around the world, nuclear power, renewables. These were all fantastic themes and no one ever called them bubbles. They all turned out to be worthwhile, but they were started by the government private sector where we were left with a legacy of greatness but not a lot of profit from it. Now I think people like Joe Tsai look at the Capex boom and figure it's a big bust for Microsoft's copilot chat CBT X Ayes Grok, Alphabet's Gemini as well as others like Anthropic Claude and Perplexity AI. After all, it does feel like the dot com bubble of the late 90s. And I live through that. I get that. Lots of similarities. So many companies involved look like Netscape or InfoSpeak, InfoSpace, MySpace, GeoCities, America Online. All barges destined for the scrap heap. But most of these private sector capital expenditure booms did have a handful of winners. Let's not forget that the dot com boom did produce a couple incredible companies, Google and Amazon. And were a few others that actually worked. Priceline now booking holdings. Sure a lot of companies take up by the wayside, but Google, Amazon and Priceline were visible winners that never look back and they made you a fortune. Right now at this very moment, you have a handful of companies all vying to be winners in the chat slash agent space. They love to win, but more important, they hate to lose. So yes, Joe Tsai is right. The data center capex boom could turn into a trillion dollar bust or maybe even a multitrillion dollar bust. But that's only for the losers. The winners could make out like bandits. So ask yourself, do you think that Alphabet can afford to become America Online? Can Microsoft afford to be a Yahoo powered chat bot? Can you imagine X AIs GROK as AltaVista or meta platforms having one of its platforms turn space? That's one way to look at it. But it's only relevant if this is a typical private sector boom, and I don't think it is. Historically the private sector booms according to Deutsche bank piece were financed with debt and stock issuance issue was way too much debt in this case. The companies involved are all basically incredibly well financed nation states with unlimited firepower. Lots of times I feel that it's winner take all, loser take none. But what, what if we're looking at these general platforms and agents in a way that's too static? Or maybe I am. What if there are so many uses once you build the thing that it's stupid not to do so? Which brings me to Jensen Mo, the CEO of Nvidia, the biggest winner from the general BI infrastructure buildout because only Nvidia's chips are strong enough, smart enough and fast enough to develop things that we haven't thought of yet or things that sound like total science fiction. Nvidia chips will be vital to make these designs come to life and we don't even know what those designs are yet. I want you to listen to this. It'll tell you what I mean. You were talking about. We need an amount of computation that's easily a hundred times more than we thought. So far, so good. Last year, were we that off last year? Yeah, we're way off. Yeah, we were. We didn't see it. We just didn't know how important it is. Well, we realized that reasoning is very important to intelligence. And we realized that one shot AI that we were using wasn't representative of intelligence and that we were going to make incredible progress. And last year with reasoning models coming out, ChatGPT's reasoning model and others, and it just took off. Intelligent factories took off. We didn't even know you could have them. And now they're huge. Do you think that the companies buying these chips don't know what they're doing? It's the opposite. They're trying to play a part in the next industrial revolution. There may be money you make for everyone, maybe, maybe beyond anything that Josiah could imagine. These data centers can become the brains of autonomous vehicles. They can be used to run chat bots at a speed that you can't even see. They can run robots that can do anything but that we can do, but better. It's just too early to find out the winners because everything's so new and we don't know what these companies are really working on. When I was at gcc, the Woodstock of AI saw things I didn't think were possible. More important, I saw things I never imagined. And that's why I don't think it's a bubble. The use cases are just too great. I'll let Jensen do the talking. Believe me, owning Nvidia has become a heavy burden for me. It seems to be at the epicenter of the so called bubble, which is now why it sells it just 26 times earnings. And by the way, that's a true sign that people don't believe anymore. Nvidia's current valuation basically says that Josiah is right, the bubble is about to pop. But let's think about that. When I was at gtc, I saw robots that look like humans, which makes sense because they have to be able to reach and bend and pivot like we do. But unlike us, these run on computing power supplied by Nvidia chips. When they figure out everything we do by ingesting video, they will clean the table, rinse the dishes, load the dishwasher, run it, put away everything, and then vacuum before going upstairs to clean your bathroom. You'll probably want to rent these robots. The oligarchs will probably own dozens of them. They'll probably have some Chinese ones too, because the Chinese are still spending a fortune on AI hardware. Except using inferior chips from Nvidia because they can't get the best ones. Believe me, they would love to get the so called bubble going in China. So I cling to my positions. All available. Look at my travel trust portfolio. And I stick by my guns. This might be the boom that doesn't go bust because the players are so well capitalized. It simply doesn't have to end that way. In some ways I'm glad to see these sunshine Patriot stockholders get new leave so we can get a new clean slate of investors in these stocks. But the bottom line, if you're any of the hyper competitive tech execs involved in the space race, you know what's going on. You hate to lose and you won't let it happen. After all, how do you think they got where they are in the first place? Jason, New Jersey Jason. Jim, a big booyah from Auburn, New Jersey. Fantastic. Welcome aboard. What's going on? Thank you, Jim. Last month we had the heat going here in New Jersey and we went down to visit my son down in Florida and we had the AC cranking. My wife Andrea said why don't you look into some H Vac stocks. Jim, your thoughts on train technologies. Tt. TT is absolutely terrific. We've had them on the show. They really know what they're doing. I like I'm giving you two for you mentioned Florida, West Palm. That is right where carrier is. Dave Gillen. Both stocks are excellent. I wish I had more time. I you know what? I let that sot run too long. That's TV talk for Jim Cramer. Jim Cramer's an idiot and overrode everybody didn't know what he's doing. Okay. There's a lot of hey, come on. I'm allowed to do that now, sir. 20th There's a lot of negativity surrounding the data center build out but maybe this is the boom that doesn't go bust because these top players are so well capitalized and they're run by such smart people. Well Matt, tonight how could AI and automation shape the cyberspace? I'm checking in with Palo Alto. You're the CEO's take on the future of tech. Then I'm giving you another stock to watch. Has had some success in the tough market. I'll tell you the name and the reasons for its run up. And later, don't miss my sit down with international paper Top risk. It's a change company I'm seeing if the company couldn't have even a broader look at the state of the supply chain. So stay with Kramer. Don't miss a second of Mad Money. Follow imKramer on X. Have a question. Tweet Kramer Madmentions. Send Jim an email to madmoneynbc.com or give us a call at 1-800-743-CNBC. Missed something. Head to madmoney.cnbc.com.
- [11:10]
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- [11:50]
Empower Representative
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- [12:50]
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- [13:11]
Jim Cramer
Last week when out to Nvidia's GTC event. That's the Woodstock of AI where we learn about how all these sorts of business are using artificial intelligence. But businesses aren't the only ones put in this work. This take the work. I got to tell you, some hackers are doing the same thing. See, they can use AI to expose sensitive information in record time time. This is terrible. So how the heck can companies protect themselves from AI empowered crooks? Earlier today we sat down with Nikesha Roy as the Chairman CEO of Palo Alto Networks for his company rang the closing bell at The NASDAQ celebration 20th anniversary. Take a look. First congratulations. 20th anniversary. You are in a tough business. I think it's a bit of a wonder that you've been able to stay on top of the game. How can you do it?
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Nikesh Arora
Well, Jim, first of all, thank you again. Nice to see you. Yeah. You know, cyber security companies have this property that they don't last 20 years very often. So we're delighted it's our 20th anniversary. Delighted that we have both the opportunity to serve our customers the way we're able to. And we have a great company, so couldn't be happier.
- [14:13]
Jim Cramer
Well, I think that through this period, you have companies that are just starting. Say I started an enterprise, thousand people. What would you tell me to do if I came to you fresh versus a company that's legacy and got all sorts of systems and who knows what they're going to be hacked by?
- [14:29]
Nikesh Arora
Yeah. As a customer, I would tell you that with the advent of every wave of technology and now we're seeing this big AI boom, and you've been talking about it, and everybody's talking about it. The one thing that is a constant is your attack surface continues to expand. Now people are going to find ways to get into your business using AI hacks or hacking your AI implementation as they would with your cloud implementation in the past. So I think as the attack surface continues to expand and technology allows us to go at things much faster, the bad actors, unfortunately, use the same technique. So you have to make sure you are able to protect your crown jewels and find the bad actors in your system in real time.
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Jim Cramer
Well, you can use this great example of hijacking the agent in Waymo. I mean, tell me about that, because that, to me, is one of the most frightening things I can think about.
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Nikesh Arora
Well, like, you know, we all like the new conversation, and the new conversation IS agents, like AI is passe. ChatGPT was interesting one year ago. Now it's about getting agents to do things for you, whether you're an enterprise company or a consumer company. The way I say it is agents is like giving AI arms and legs and saying, go do something for me. You know, you took the brain, which is really smart, and helped you figure stuff out. And you can write sonnets and have, you know, recite Shakespeare back to you in your funny accent, but giving it arms and legs is kind of the next frontier. And people say, well, that's not going to happen. We're going to manage it. We're going to control it. I was like, it's already happening. Look out there. You get into Waymo, you just gave AI arms and legs. You let it decide where to turn, when to stop, how fast to drive, and how to get you from point A to point B. I imagine the same thing applied to robotic automation, substations, dams. If you start letting agents manage critical infrastructure, you got to be very sure that those access points are protected because over time there'll be less and less human intervention, human supervision, in which case you need to be more secure.
- [16:25]
Jim Cramer
Well, you talk about that period where you put something in and if you do it wrong, you're dead. But you also use a great term. You call it the technological debt that has not been paid. Which one of that? I love it.
- [16:37]
Nikesh Arora
Well, think about it. If you look, the Average life of IT infrastructure is 10 to 12 years old. Have you spent, you know, about $1 trillion a year, right? So think about it. All that money that spend is sitting in old plan. We can't change the whole plant on an annualized basis. So it takes seven to 10 years to change your technology plan. And that's the time you're sitting on legacy infrastructure, legacy debt. You can't take it away. So as you evolve, as you get your technology to be more and more in line with the cloud, in line with mobility, in line with AI, it gets better. But you're still sending stuff that's 10 years old in infrastructure, which was never designed for AI to appear or the cloud to appear.
- [17:20]
Jim Cramer
Well, is that what the federal government has? Some people feel that DOGE is a threat to you. I think they've got all these systems that you actually could come in and save the government some money and also save it from the bad actors who can get in between these things.
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Nikesh Arora
Well, you know, the government has been slower to adopt technology because they're trying to make sure that before they go to the cloud, they suss everything out. And I think one of the biggest opportunities as we get through the phase of cost cutting is automation and efficiency driven by technology. So I expect the only way DOGE will be able to get where it wants to get, or we can get to a much more efficient, lower cost operation is to automate a lot of.
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Jim Cramer
Well, you suspect they've been in contact with you?
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Nikesh Arora
Well, we have talked to various parts of the government about. So remember, it's early days, it's only been a few months.
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Jim Cramer
I want to see you win business. My charitable trust has a big position in your stock for evidence.
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Nikesh Arora
I am very optimistic about the potential for technology and cybersecurity as we get through the early months of this unsettling period. We're trying to figure out what the right path forward is from an automation perspective. But I think their heart and souls in the right place. They're trying to do the right thing for the country. I think they're trying to have us be a much more efficient government. They're trying to have us be a much more balanced sort of book of business. So I think there's opportunity for all technology companies in the future as we get into the automation and the technology adoption part, hopefully.
- [18:41]
Jim Cramer
Okay, now, on March 18, you tweeted, never dull moment in cybersecurity. And that was when Google bought Wiz for an astounding $32 billion. Now, you've got twofold here that I want to ask. You worked there for 10 years, 2004 to 2014, and you use BigQuery. You are a customer of theirs. 170,000 projects in Google cloud. What happens if Google says to you, you know what, we have Whiz 170. Go on.
- [19:07]
Nikesh Arora
No. So first and foremost, it's a great day for cybersecurity. If you can build a business and you can sell it for that amount of money, it inspires more entrepreneurs to go out there and build their next cybersecurity business.
- [19:19]
Jim Cramer
You tell Me instead of 124 billion, you might be worth more because of that.
- [19:22]
Nikesh Arora
Well, if 600 million ARR is worth $32 billion, I can do math. We're closing it on 6 billion. But let's put that aside. You know, as they say, the price of something is what somebody's willing to pay. So look, it's a great day for cybersecurity. One, two. In terms of, we are one of the largest customers of Google, both on the security side, the enterprise side. And we have talked to them and they're trying to keep it balanced in terms to make sure that they serve their customers effectively. And at the same time, we have a bit of coopetition going on.
- [19:53]
Jim Cramer
Do I need to work on that? They could just say, you know what, I know you're a customer, but we don't want you anymore.
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Nikesh Arora
I think that's going to be very hard for them to do. I think, in fact, they haven't said it. We had a wonderful conversation with them last week and we're continuing to begin to work with Google. We continue to run our infrastructure on GCP and some other cloud providers. So I think from that perspective, it's fine. I think it's going to be interesting what happens in cybersecurity going forward. I think we will continue to see consolidation. I think the world is heading towards platforms, something we've been talking about for a while. I think this is one more reinforcement that you can't just have one piece of the action. You need to bring more. And you're seeing that Google do it. You see, Microsoft has A phenomenal security business. We have a good security business. You're beginning to see that you need to be big in cybersecurity.
- [20:40]
Jim Cramer
You have security business with IBM? Yes, as a partnership seems like it's working out well.
- [20:46]
Nikesh Arora
You know it's going to go down as one of our best arrangements deals we did in history because you know, Arvind and his team are just amazing. They are forward leaning. They have north of a thousand people working with us on this now and we are able to migrate a lot of the IBM customers who are on the technology called qradar which was robust but needed sort of a refresh. And we are able to provide refresh in the form of our product called xim, which is now the leading product from our perspective instead of powered by AI.
- [21:15]
Jim Cramer
All right, now I know we have to wrap things up but Keanu Reeves, John Wick, cool guy, Very cool.
- [21:21]
Nikesh Arora
Yeah, very cool. I mean who else, of course, who else would you have epitomized saving the world in a cyber incident but Keanu Reeves?
- [21:28]
Jim Cramer
Fair enough. The Geshe Award. Chairman CEO of Palo Alto Networks. Thank you, Nikesh.
- [21:32]
Nikesh Arora
Thank you, Jim.
- [21:35]
Jim Cramer
Coming up, Kramer continues his look at what's working in this tape with a pulse check on the health care space space next.
- [21:44]
Comcast Representative
At Capella University. Learning the right skills could make a difference. That's why our business programs teach you relevant skills you can take from the course room to the workplace. A different future is closer than you think with Capella University. Learn more at capella. Edu My side hustle brings in over six figures.
- [22:03]
Jim Cramer
About $10,000 a month. Over $500,000 since its beginning. Find your hustle with CNBC. Make it's new online course how to.
- [22:11]
Comcast Representative
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- [22:12]
Jim Cramer
Three industry experts break down proven paths to success. There's a tremendous amount of opportunity out there and help you choose the one that fits your life schedule and goals. Find your own path to building multiple income Streams. Register@cnbcmakeit.com Sidehustle special offer ends April 1st. We're seeing some signs of stabilization stock market but until tariff day rise on April 2, uncertainty remains king. For now we're in a holding pattern awaiting more details in the president's adjusted trade policy along with more economic data and of course earnings season oh my. In a few weeks. Don't get any sleep then. Now we don't know if we're merely in the eye of the storm or if we're truly got clear skies in the market again. But after coming through a very difficult period for Stocks. We do know which one still managed to rally during a hideous time. That's why all week I'm walking you through some of the 10 best performers in the S&P 500 year to date. Because for the most part, these are the stocks that survived and thrived during the correction. Now, last I talked about Newmont Corporation because the gold miners have been big winners here. Real safety stocks when you're worried about worldwide economic chaos. And tonight I've got another classic safety category that's thriving in 2025. Just took a little breather today, and that is the pharmaceutical stocks. So let's start with one that really is one of my favorites. Vertex Pharmaceuticals. It's the seventh best performer in the S and P this year. It's up more than 26% for 2025. This one's an old family favorite. I long liked Vertex for the show for ages. It's an innovative biotech that I originally recommended for its fantastic cystic fibrosis franchise. But over the years, we've watched Vertex mature into a big pharma company with 131 billion dollar market capitalization. That cystic fibrosis business alone did 10 billion in sales last year. And it's why I've championed the company. Now, more recently, Vertex has come up with a budding non opioid painkiller business. Now this is incredibly exciting because America has a massive opioid epidemic. Something like 87,000 drug overdose deaths. Last year. This is the leading cause of death for Americans aged 18 to 44, even as overdose tests were down 24%. The numbers may be coming down, but you gotta admit they're horrifying. Unfortunately, opioids have been the most effective way to treat severe pain. And until Vertex was no addictive, non addictive alternative, everything was addictive. Your only choice were to risk getting addicted or pray that a little Tylenol could do the job. Now, Vertex changed all that with a drug and I'm going to get this right. I think. Suzetrachine, Zusetrachine. This is a very effective painkiller that basically blocks parts of your nervous system rather than directly messing with your brain, which means it's not addictive. Now this one got FDA approval for moderate to severe acute pain at the end of January, which is why Vertex has been such a big winner this year. But in order to get that gain, you needed to have a lot of faith in this company. I recommended it back in mid December as part of a group of beaten down healthcare stocks. Now it's up nearly 9% since then, versus a 5% decline for the SB500. But three days later, Vertex plunged 11%. Single session after we got some confusing phase 2 clinical trial results studying suzetrochine for a type of chronic back pain caused by pinched nerves. This stuff's so painful. While the drug met its primary input, allowing them to move on to phase three trials, the placebo group experienced a similar reduction in pain that called the entire study into question. And a lot of people figured that it would be tougher for the FDA to approve this Vertex painkiller for anything related to chronic pain. Now I hope you stuck with it though, because after that setback, the stock caught fire. It has not looked back since. In fact, the very next day, the FDA approved Vertex's new cystic fibrosis drug. But the big news came on January 30th when the FDA approved suzetrachine for moderate severe pain. Now that's under the new name. It's called Journevix. First non addictive painkiller to be approved for severe acute pain in more than 20 years. The drug's launch is now well underway. Vertex is working with insurance companies and group purchasing organizations to maximize coverage. This is a joyous story, people. And even talking to politicians to push legislation that promotes non opioid painkillers. I like this. In fact, UnitedHealthcare's OptumRx subsidiary announced coverage for Jordan Vicks earlier this month, marking the drug's first big pharmacy benefits manager win ahead of its launch. A few states, including New York and Arkansas have already provided broad Medicaid access to the drug as well. We still need to watch how they do with chronic pain rather than acute pain, but so far so good. When Vertex reported in early February, the numbers were solid. And once the market started falling apart last month, the stock kept levitating along with the rest of pharmaceutical space. In fact, the whole health care sector has been pretty doing pretty well this year. The Health Care Select Spider fund, that's One of these ETFs is up 5.5% 2020 25. Only energy has been doing better. And many of my favorite stocks in the individual, the individual pharma stocks, not just the etf, are doing very well. Longtime Kramer fave and charitable trust holding Eli Lilly has been volatile at times because it's a high multiple growth story. Okay, now it's just got a high P. And it pre announced this point in fourth quarter numbers on this show in January, but it bounced right back quickly once they've Reported the full fourth quarter in early February as the earnings numbers look very good and their full year forecast was excellent. It's currently sports a more than 10% gain for the year. I don't think it's done. We had Ken Langone recently. You know that he's one of the great investors of all time. He still loves it. Prescription data for Louis Lead GLP one drug known as Mounjaro for diabetes. Zeppelin for weight loss continues to look strong. The next big catalyst for Lilly this year should be a phase 3 data readout for trials evaluating an oral GLP1 drug. Right now you got to stick it in. That's expected this summer. I remain very positive on the stock of highlight the performance of another charitable trust holding Bristol Myers Squibb which is up almost 5% this year largely thanks to this early strength of the company's new schizophrenia drug. Another thing that we had nothing for in 30 years. This is called Quebec. This one was approved by the FDA last fall. It represents the industry's first new approach because by the way, schizophrenia, they used to treat it with, you know, any, any old drug that worked for seizures. All the existing treatments cause horrific side effects which is why so many people went off their meds. But coping coban fees much milder, doesn't have a weight gain issue. And Bristol Myers thinks you can get approval for many other mental illnesses in the future. I'm very positive on it really. All sorts of pharma stocks are working this year putting former underpreneurs like underperformers like Gilead. It's up 17%. Abbie up 13%. Down a lot today. James up more than 1%. Another stock they got hit Avid Labs. Big position for us is more of a medical device play we own for the Chapel Trust scanned 11% for the year. The relative safety of these health care names has trumped some of the remaining questions about the group. Like any potential adverse impact from the Health and Human Services Secretary RFK Jr. Who's got a bad attitude toward vaccines and maybe the pharma industry in general. Here's the bottom line. Even in a hideous environment, many of the pharma stocks have soared. Especially Kramer vay Vertex with its revolutionary non addictive painkiller that could single handedly beat the opioid epidemic. I know the group was weak today. It's been weak for a couple of days. But I think there's opportunity here to buy these stocks. I just went over as the cohorts really cooled down from that particular spike that I warned you about a few weeks ago. I think it's time to do some buying now. Tune in tomorrow night for another installment of this series on the first quarter's biggest winners, the stocks that triumphed over the brutal correction. I'm going to go to Lou in Pennsylvania. Lou, hi Jim. I own shares of this British pharmaceutical company and have done well with it except over the last two weeks when it has a lot of company. Trump has recently however, threatened tariffs on pharmaceutical companies. Has this changed your previously positive opinion on gsk? Not at all. I like GSK very much. I think it's a very good company. I think Damon Dame Wamsley is doing a terrific job. I think the stock, the fact that is a very low P and it yields 4%. That's my kind of stock. I think you put it away, buy it and put it away. I want to go to Brett in California. Boost Brett. Hi Jim, I'm calling to get your opinion on Catalyst Pharmaceuticals. About a year ago you did a segment on the show regarding five small cap health care stocks and that was one you profiled and I've owned it for about a year and a half and was just wondering what your current thoughts are. No, I think it's very good and it's had a very good year. It's up more than almost every other drug any company company I follow. Yeah, we did like it. Now remember there's still small cap stock and there is some insider selling but I do think it's just a very good situation. We went over that a while ago and it beat the earnings estimates be crushed Airbuster and 55 cents that earn 70 cents. That's my kind of stock. I think you're in good shape. Now we're going to go to John Masters. John Tim, thanks so much for taking my call. I appreciate it. Of course I wanted to get your thoughts Jim, on simple DCT Dell Cap Systems it's been great and hoping it can run again in 25. Well it's especially pharma company. It is supposed to have its earnings breakout this year and that's why I'm going to bless it because remember I'm not recommending stocks that are losing money but supposed to have an earnings breakout. But I would say people who are looking at it, it's not, you're not early to the story anymore. I'm glad that you John been able to take advantage of the fact that this talk's been such a win. Now even in this top tape the pharma secretary has held its own especially one of My faves, Vertex Pharma. Don't forget Bristol Myers and Eli Lilly. Now much more may have Moneyhead including my exclusive with fiber product producer International Paper Today after their investor day worth looking at then fresh was some concerning concern consumer data. I'm breaking down what I think could return some much needed confidence to this economy and to the people in it. And of course oil calls rapid fire. Tonight's edition of the lightning round. So stay with Kramer. Look at this incredible move in the stock of International Paper. The packaging kingpins up nearly 6.5% today. Now normally the packaging stocks have a lot of economic sensitivity meaning they get hit hard when people are worried about the economy. I think this time is clearly different. About a year ago International Paper brought in a new CEO, Andy Silver now and he announced an all stock merger with DS Smith which is a European company in the same line of business. After formally taking over last May, Silverdale got to work turning the business around. The stock has followed suits up 38% over the past year. Okay, maybe you can't see the numbers yet, but this story's got a lot of believers. Now Today International Paper hold a big investor day in in the city, New York City where management rolled out some ambitious longer term financial targets and that's why the stock caught fire. So can it keep running? Let's check in with Andy Silver. No. He's the new chairman and CEO of International Paper. To find out. Bishop Silver, welcome to May have Money.
- [33:05]
Andy Silver
Thanks Jim. Thanks for having me here.
- [33:06]
Jim Cramer
Well, I have to tell you it's all different with you. No, I mean it because we've seen you come in as the mandate as a change agent and you've delivered.
- [33:15]
Andy Silver
Yeah, yeah.
- [33:16]
Jim Cramer
Thank you, Jim.
- [33:16]
Andy Silver
First of all, it's a pleasure to be here. And the team we have at International Paper, they are outstanding. You know one of the things when you're looking at a new opportunity, when they came and contacted me, you're looking at what's this team going to be like. And we have 65,000 employees here at International Paper now, including DS Smith. And they are outstanding and they've bought in to change. They bought into transformation. And that's what we're doing. We want to be the world's leader in sustainable packaging. And this team is fired up and bought in.
- [33:42]
Jim Cramer
Now you have come up with something I've heard. We saw itw another very successful company, the 8020 strategic which means that you really are drilling down and emphasizing the biggest customers and then doing great non commodity things for them.
- [33:57]
Andy Silver
That's exactly right. So, Jim, 80 20. Right. It came out of it w. As I was in Chicago working for idex. That's. We borrowed it from them. All right, so thank you. And you know, one of the things I learned early in my career. So I was at Danaher right out of business school. So I was at Danaher right out of business school. And you saw the power of a system, of a system that's understandable, applicable, something that can help you win. And 80 20, is that what it is? It's all about figuring out what matters most. Where's money?
- [34:24]
Jim Cramer
Right.
- [34:24]
Andy Silver
Where is the profit pool? And then how do you move people and investment towards that? It also means saying no to the things that don't create value.
- [34:32]
Jim Cramer
Well, okay, let's talk about that. Because my father was a jobber for International Paper for years. And then what would happen? He was selling craft paper and corrugated. And then guy would come in from Stone and say, Listen, Mr. Kramer, I can make it. I'd make it cheaper. And then he, then Smurfit would come in, then West Rock would come in. He ended up with a pile corrugated, and no one made any money at all. That has to end. Right? Right.
- [34:50]
Andy Silver
It has to end. And that's one of the cool things about it, having grown up in a paper mill because you're families. My wife was the fourth generation of working in the Bucksport paper mill. It's just incredible. My father in law retired from ip. Just a great story. But the key is we are not a paper company. We're a packaging company. And the thing to think about is differentiated packaging. And what we do is we enable our customers to get their goods to their customers. And what matters is the value in the value chain. So if you think about that cost of ownership, that cost of the value chain, we're trying to help them win. And so that's not a commodity page business, that's a differentiated business that's helped them win.
- [35:26]
Jim Cramer
Well, you have to tell me, what do you do for Mondelez that makes it so that I couldn't come in with my paper company and say, listen, Mondelez, I'll come in under you. I'll come under some paper.
- [35:35]
Andy Silver
Yeah, we solve problems, Jim. What we do is we solve their problems. So I'll give you a great example. So I. The first time I went to DS Smith, I went to their impact center, which is an innovation center, and Mondelez, you got a chocolate bar that goes into a package, that goes into a supermarket, and those chocolate bars would fall over. So customer can't see it. So we came up with this great innovation that actually pulled the bars forward. So if someone takes a bar out, the next one pushes forward, sales go up 35, 40%. That's solutions. That's the kind of things you're trying to do.
- [36:06]
Jim Cramer
Now, how about in the. When you're dealing with fresh protein poultry, how can you innovate on that?
- [36:11]
Andy Silver
Well, so you think about the cost of moving chicken or beef or something like that. You have to move it refrigerated. You have to have boxes that are strong. They can't leak anywhere.
- [36:20]
Jim Cramer
Right.
- [36:20]
Andy Silver
So you're in there solving problems with them. That's the key. You're solving problems with them, like, where's the cost of failure? Where are the points of failure? And you're working collaborative with them to come up with design, to come up with technology that lets them ship their products safe, productive. You're trying to help them drive and win in the marketplace.
- [36:37]
Jim Cramer
Now, formerly, I know you would have plants that were nowhere near any of these customers, and therefore you had no advantage in terms of speed. Yeah. Is that change?
- [36:44]
Andy Silver
It's changed enormously. So if you look at our network in Europe or the U.S. we have 110 box plants in the U.S. yes, every major metro area. Because if you think about it, you're shipping air. When you ship a box, you're shipping air. So you've got to be close to the customer. So we have. If you look around New York City, we have a series of box plants around New York City that's feeding all of the industry around here, multiple plants.
- [37:05]
Jim Cramer
So. Including E Commerce, right? You're helping E Commerce.
- [37:08]
Andy Silver
Yes, we are within 2, 200 miles of 95% of the population in America. And any place you go within 200.
- [37:14]
Jim Cramer
Miles, so different from the old.
- [37:16]
Andy Silver
It is in it.
- [37:17]
Jim Cramer
Yeah, it's glorious. I mean, I think that you've solved what many people always wanted IP to do, which is do what the customer wanted.
- [37:24]
Andy Silver
That's the key. Right. You work back from the customer, and that's how you win.
- [37:28]
Jim Cramer
And in that way, a rival can't come in and say, look, I can do that, because they can't.
- [37:34]
Andy Silver
It's pretty hard, right? So the scale and the scope of what we have throughout the country, throughout Europe now with the DSmith acquisition, it's pretty hard to match that scale and scope. And then you put customer intimacy with it. That's a winning move.
- [37:47]
Jim Cramer
Well, I've always felt it could just be a huge stock. From the time when my father repped them. And it looks like it's finally coming true. Took a little while. That doesn't matter. What matters is it got there. I think people should look at the stock. That's Andy Silvers, the chairman CEO of International Paper ip. Wow. It's happening. Their money's back here for the break. Coming up, Kramer takes your calls. And the sky's the limit. It's a fast fire lightning round. Next it is time to top of the white rail cruise red bar. Close one of the same above Also play this out and then the lightning round is over. Are you ready, Steve? Daddy. Time for the lightning round creation Marvel stopper Stephanie in Colorado. Stephanie. Yes.
- [38:37]
Comcast Representative
Hello, Mr. Kramer.
- [38:39]
Jim Cramer
I'm so happy to connect with you. I wonder what your opinion is about Shopify. Oh, Shopify, the Canadian super out that is going to be moving to here. And listen to New York. I say buy, buy, buy, buy, buy. And now we're going to go to Frank in Ohio. Frank. Hello, Mr. Kramer. I have a stock pains America. Listen, sunshine, that's a terrific stock with 70 yield. I'm not only am I a buyer, but I wish we had it for the charitable trust. Now we're gonna go to Laura in Connecticut. Laura, that accent. Laura. Hello. Hello. Thank you for having me on the show. So excited. Pleasure. So I have a question and I'm hoping you could help me out. I had bought Soundhound low. Okay, so look, I want you to sell Soundhound. I regard Soundhound as a complete meme stock. It's part of the cohort that we see now trades every morning and it's depending upon its relationship with Nvidia. And I don't think the relationship is really that meaningful. I think you should sell sound. Okay. I'm putting it out there. I know it's going to give you a lot of heat online, but I don't care. Let's go to Brian in Michigan. Brian. Hi, Jim, this is Brian. I'm long term. I've been watching every. Every day at 9 and 6 and thank you, man. Thank you. Yeah, I thank you for what you. You give all of us and I just want to get your opinion on fmc. Is it about. I was very depressed by FMC right at the time we're winning the Super super bowl in Philadelphia. They came out and they were like, I mean they dropped the ball. It's very rare to see a fumble like that was so bad as they did. It was like a pick six against them. I, I want you to stay away from fmc. They have a Lot to prove. That was a terrible quarter. Let's go to Paul in Arizona. Paul. Jim.
- [40:29]
Nikesh Arora
Long time.
- [40:29]
Jim Cramer
First time. Oh, excellent. I'm glad you're on. What's up? You have a tremendous amount of energy. I don't know how you do it. Well, I don't know. I got a great staff. I got Regina Gilgan looking at me. She's always critical of me. That's fine. Keeps me on my toes. Thank you. Right to the chase. I'm curious to know what is your take in general on the coal industry and what is your take? You know, I was betting that coal could make a comeback only just because I just thought that was not with the president. But the prices for coal are so bad. What? Any particular stock in the Coal Coal group? Yes, sir. Core Natural Resources cnr. That's just another. Another just, you know, it's a Pennsylvania coal company, but there's. There's just not much to these stocks. I wish they could find a bottom, but they can't. But I really think bad that you called about it. Let's go to Charlie in California. Charlie. Hey, Jim. Hey, Long time listener. I really appreciate what you do. I wanted to start off by saying thank you. If it wasn't for you, I probably would have never gotten the market. The way you explain it on all.
- [41:30]
Empower Representative
Your shows is it gave me the.
- [41:32]
Jim Cramer
Confidence to do what I do now. Thanks, Charlie. Well, that's the goal. To give people confidence to make the decisions themselves is really my goal because they have it in them. And so do you. Charlie, how can I help you? Hey. So I'm a big fan of Palantir. I was in it way back when it was 18 bucks a share. I got out before it took this last dive. Is it time to get back in? Yes, it is. Palantir is a winner. And I'm telling you, we're going to see what they do with the defense part. I'm telling you, they are going to help the procurement department, the procurement process. And I'm a believer in Palantir. Even if they don't believe in me, I don't care. Let's go to Eric in Michigan. Eric. Jim. I'm a diehard money watcher and a member of the club. Yes. Thank you. What's going on? Two quick questions about Rocket Company. Question number one. I own a significant position in Rocket Company and wanted your opinion on the recent purchase of Redfin. In question two, when the Fed cuts interest rates and we get a refinancing boom, can this stock double from here? Okay. I was not a big fan of the Redfin acquisition. And that was in part because I looked at Redfin many, many times. Couldn't really figure it out. However, I am a big figure, a big believer. Rocket. And yes, exactly what you said will happen. Therefore, you can own Rocket, the Redfin. I wish they. David, come on and explain it. I really do, because I really like them. But I thought that was quizzical. Let's go to Richard in New York. Richard. Sir. Jimmy, chill. Yo, man, what's happening? Well, my pleasure. Right back at you. Thank you, sir. So, listen, I recently got involved in the stock about a month ago. It had recent approvals from fda and it did get a little pop. But every day since then, it seems like it's dropped for over a month. And then I looked into it. There's obviously been some insider trading. Even a million shares this week. And my question is, when is it investable? Is it still investable? Swtx? Springworks Therapeutics? Man, I don't know. Spring works from spring water. We're gonna have to do some work on that one. I'm gonna put the professor Ben Stodo all over that because he knows that game forwards and backwards. And that, ladies and gentlemen, is the conclusion of the Lightning Round. The Lightning Round is sponsored by Charles Schwab. Let's say you're on Recession Watch, which I am most definitely not. But if you're betting on a recession, this was a banner day for you. 24 hours. We got some very worrying signs right now. Many believe the Federal Reserve is on hold because it wants to see what the tariffs will look like. But today's comments from KB Home, the homebuilder, along with the hideous consumer confidence numbers from the conference board, cast serious doubt on the idea that we've got any sort of growth in this economy. It may need some help soon. The Federal Reserve. Let me tackle KB Homes first. This is a large homebuilder with the presence of 10 states, all known to be hot markets. States like Colorado, Nevada, California, Florida, Texas, tells homes for about half a million dollars on average last night. Jeffrey Metzger, the CEO for 19 years, and I regard him as an elder statesman out in the industry, said the words no one wanted to hear. Quote, consumers are continuing to cope with affordability concerns and uncertainties around macroeconomic and geopolitical events, end quote. He goes on to say, as a result, consumer confidence has declined sequentially each month for the past several months, and homebuyers are moving more slowly in making their purchase decisions, end quote. Not Great, Bob. But it gets worse. Quote demand at the start of the spring season. Selling season has been more muted than we have seen over the past few years. Muted. Ouch. KB Solutions cutting its price of homes and it's cutting its forecast suboptimal. Second big thing this morning, the Conference Board's consumer confidence index may be blanched. The expectations index based on consumers short term outlook dropped 9.6 points to 65.2. That's the lowest level in 12 years, just worse than Covid times. That's well below the threshold of 80. That usually signals a recession is the fourth consecutive month of declining consumer confidence. I regard that as very disconcerting. Now that's the bad news. The good news is the Federal Reserve can see this data too and it can take action if it must, even though the Fed's gotten less certain about its next move. When I see these numbers though, I think maybe the Fed can't afford to wait until they see how much inflation the tariffs cause. We simply don't want a recession here if it's avoidable. But let's address the consumer confidence issue head on. I think people in this country read about the zest with which the White House is laying off people, closing portions of the government, even let's say touching Social Security administration, which is a political malpractice and a proven third rail. They're worried about layoffs and machines taking their jobs. Makes sense. The robots just keep getting better and smarter. They're concerned about tariffs too, in part because the White House really hasn't done a good job explaining why some tariffs are necessary, but also because they know that it's going to be short term pain because, well, the White House said it, the house of pain. All these concerns erode confidence. When confidence seeps away, people hunker down. They stop going out, they stop spending. Hence why so many big retail stocks are doing so poorly. Is there anything the President can do about this? I think it might be time that he actually talks to people in a calm way about how many jobs could be created by cracking down on our so called trading partners. Time to bury the hatchet with Mexico and Canada too. And don't bury it in the head of Mark Carney, the new Canadian Prime Minister. I think confidence is returned with certainty. Even the certainty of knowing what will happen with these two countries could really help. Look, as someone who believes in fair trade, not fair free trade, I'm happy to take a short term hit if it means leveling the playing field on trade. But I have the luxury of liking it. For me, the pain is all theoretical. It's not like I'm living paycheck to paycheck. I know that I'm actually proud of it, but I was at one time. Most people don't have the luxury I have when enough people start worrying about the economy. That's how a recession starts. And once it starts, it's very hard to stop. I like to say there's always more markets. Homer problems I find Just for you, right here on Mad Money. I'm Jim Cramer and I'll see you tomorrow.
- [47:41]
Comcast Representative
All opinions expressed by Jim Cramer on this podcast are solely Kramer's opinions and do not reflect the opinions of CNBC, NBCUniversal, or their parent company or affiliates, and may have been previously disseminated by Kramer on television, radio, Internet, or another medium. You should not treat any opinion expressed by Jim Cramer as a specific inducement to make a particular investment or follow a particular strategy, but only as an expression of his opinion. Kramer's opinions are based upon information he considers reliable, but neither CNBC nor its affiliates and or subsidiaries warrant its completeness or accuracy, and it should not be relied upon as such. To view the full Mad Money disclaimer, please visit cnbc.com madmoneydisclaimer@ Capella University, learning the right skills could make a difference. That's why our business programs teach you relevant skills you can take from the course room to the workplace. A different future is closer than you think with Capella University. Learn more at Capella. Eduardo.