← Mad Money w/ Jim Cramer
Mad Money w/ Jim Cramer
Mad Money w/ Jim Cramer 04/14/25
00:43:28
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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- [00:32]
Fidelity Investments
Don't just ride the index. Seek to outperform it with Felc, the Fidelity Enhanced Large CAP Core ETF. Unlike passive ETFs, FELC is run by a team of experts to adapt to market conditions and pursue upside potential wherever it's hiding. And while you get the potential outperformance of an actively managed fund, you can still buy and sell it on your terms just like any other ETF. Discover FELC, the Fidelity Enhanced Large Cap Core ETF part of Fidelity's suite of active ETFs. Learn more at fidelity.com felc before investing in any exchange traded fund, you should consider its investment objectives, risks, charges and expenses. Contact Fidelity for a prospectus and offering circular or if available, a summary prospectus containing this information. Read it carefully. While active ETFs offer the potential to outperform an index, these products may more significantly trail in index as compared with passive ETFs. Fidelity Brokerage Services LLC Member NYSE, SIPC.
- [01:34]
Jim Cramer
My mission is simple to make you money. I'm here to level the playing field for all investors. 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 a little money. My job is not just entertain it's but to educate. It's to teach. So call me at 1-800-743- CNBC or tweet. MER if you told me this is where the market was headed two or three months ago, I would have thought you were insane. Even crazier than I am. This radical transition over the past few weeks has just been, frankly unfathomable. We're now buying stocks we hated and we're despising. And guess what? We were now selling short. Sell, sell sell. The stocks that we used to worship. And it's all happening on the fly. The averages don't really affect that Dow gaining fear and 12 points say S&P rising point 79%. Nasdaq climbing point 64%. You can't tell what's underneath though. But that makes it much easier for those thrill seekers who want to surf the Trump stock wave. Sure, today was a bit of reversion day, a counter show because Apple got a reprieve from severe China tariffs this weekend. But we have to think about how to profit from this new market. It means making some pretty sharp changes to your portfolio. And believe me, this is something I think about every day. For the club head of my Wednesday meeting, it's like, wow, I got to get this right. See, something happened this weekend that crystallized things for me. The Wall Street Journal put together this incredible chart of the stocks that are winning so far under the reign of Trump. Oh my. The extraordinary lack of economic sensitivity, the amazing America first nature of the businesses, the pure service nature of so many of these companies. They couldn't be less like what we liked under President Biden. Rip up the old playbook. There's a new stock sheriff in town. So here's what I did. I looked at the winner so far this year from the chart and thought about which ones were good to go and which ones maybe needed to be demoted for a better substitute because perhaps they moved too far. Here's what I found and I can tell you that I didn't see much of the old guard of tech manufacturing. This is about as anti mag 7 list as you could find. So let's start with what I think you can safely buy right now. Based on what I'm seeing, I want to begin with the obvious. The health insurance companies and the drug middlemen. UnitedHealth reports this week it was down today. That's a bit of a rarity in itself and to me that makes for a terrific buying opportunity. I think the largest health insurer can do whatever it wants under this administration. Not making a judgment, just telling you as it is. Next. I've been a fan of health care cover Centene for ages. Cnc ever since late Michael Mydorf used to come on the show to explain to me how his company could offer quality health care to a state's populace. Because at control, of course, you had to treat certain illnesses and injuries in an efficient way. I like Centene. Unless Congress really passes Medicaid cuts like the House Republicans are pushing for because running Medicaid plans is a sizable part of their business. At Centene, they do it really well. How about these middlemen? I think you can buy Any one of them. I like Sancoura and I like McKesson. They take almost no risk and make fortunes in a consistent way. McKesson is one of the largest distributors of both branded and generic drugs. Company isn't a pure play though. It also develops medical record systems and provides surgical supplies too. ST Core is a worthy competitor. Include Cardinal Health, which has all that and also offers specialty pharma and health care services. I bet all three of these companies will see business boom if the Trump administration messes with the pharma supply chain, which is what I'm seeing them do after the close of today's trading. Next Defense is working again. I don't know. It shouldn't be given the pullback from Ukraine. Right? But I sense maybe we're embarking on a real build up as tensions heat up with China. I like to permanently favor Palantir, arguably the number one meme stock of all time with the CEO who whips people into a frenzy. L3Harris works as a combination defense technology, communications play. You want tech. L3Harris is the one. Though I'm loathe to recommend the others because I think the administration wants to focus on cyber warfare and targeted war fighting. Those two are the best. For some reason, road building is a big theme among the winners. That means you want to own Martin Marietta Materials as well as wm, that's the artist formerly known as Waste Management gets a big boost from construction like the other stocks on this list. You have to love how domestic these companies are. I'm thinking the road building plays are working as the money from all of Biden's infrastructure program is finally being put to work. Better late than never. Although I'm sure there are Biden people who question that flip judgment. Vulcan Materials right now is the winner in the category, but I think Martin Marietta's exposure to faster growth. There's DEBM does well when more community roads are built. It's working right here, right now and I think it's going to continue to do so even if interest rates edge higher because of the housing shortage. I want on any of these three we have some tech that works, but it's really a very small group and it's mostly involved with cybersecurity because cybersecurity, well that's like the anti China play, right? Have you seen the stock of CrowdStrike? This thing is a horse. One year after it had a computer glitch, not a hack that shut down millions of computers across the globe, it's coming back incredibly strong. CEO George Kurtz hates to lose. And his worldwide apology tour to aggrieve customers saved a lot of business and may even bring about more business than he had. You can bet that the second half of the year is going to be very strong for this stock. Why do I say that? Because Kurtz told us that when he was here last. I happen to like Palo Alto Networks too, because there's just so much work to do in this space. It's why we own both CrowdStrike and Palo Alto for the job trust. And I never violate my diversification rules. These two stocks are too good. What else? Identity theft. It's rampant antidote Octa. And how about a new one after you've been hit, what do you do? Well, you call in Rubrik. I say you buy Rubrik. After what I saw last week when we spoke to them, I think you must have one of these portfolios. One of these stocks in your portfolio you must have a cybersecurity stock. Now we need some real slow winners to food stocks. That may be the way to go now that RFK Jr. Has made it clear that he's no friend. The GOP dash one weight loss drugs. It's a total green light for candy so Hershey and Mongolies can war. I think you could always buy Colgate in this environment as it's a must own stock in a slowdown. It has been for years. Candy and toothpaste, they go very well together. Oh, and you want an upside surprise. I'm sure Coca Cola right now at this very minute is generating one for the next quarter. It is a classic bankable stock. I don't care that it's near its high. It never is that far from its high. I don't care how boring. And that it goes up slowly over time rather than like a data center stock. That's what I want. Have you seen this stock this year? It's fantastic. Now, there wasn't much retail exposure in the Journal piece. You want retail, you have to take your pick of Wal Mart or Costco. They aren't interchangeable. They are dominant. Wal Mart quarter demonstrated scale, its breadth, its worldwide opportunity. Costco is the hoarding place. And people are hoarding like bad because they know the Costco of the lowest prices. So why not buy whatever you need now before it runs out? Now there's some one else the Journal chart that I'm really liking. Remember Exxon Exo and we had bricks Mithlin. That's. Well, I got to tell you, this used to be a Taser and people still think it's Taser. It's a decent business, but not a big one. What this company really is now is the dominant software as a service system for law enforcement in cities all over America. America. Its body cam stamp system is the gold standard. Its AI work gets rid of the drudgery of filling out reports, gives police officers more time to do their actual jobs. The best. The bad guys plead guilty because it's all on tape. Utility too. There are a bunch of them in the chart. I don't like the question thing. I go for Con Ed because we live in one of the fastest growing areas in the country. 3% yield. 5. 3.7 million people with electricity. 1.1 million with gas. No faster. Mess. Finally, there's gold, which is defying everyone's. How many people said gold's peak? It's not peaking. I believe that gold is back because crypto has quietly lost its luster. I watched a guy today talk about dogecoin. I said, which would I rather have, gold or dogecoin? Yeah, right. You want gold, go with the best. You go with Agnico Eagle. It's the most efficient producer. It's like clockwork in an industry that, frankly, it ceased to be as productive as it used to be. Look, I've got no illusions. After going over these companies, I see several things the winners have in common. They don't have a lot of competition. They're largely domestic. They don't need a strong economy. You can't tariff them out of existence. They have scale and most have fat margins. With the exception of, say, Wal Mart and Costco. You don't need to worry about China. Both those two do have Chinese operations. The bottom line, you've just been given the most boring portfolio in the world. It's exactly what you need with the president who generates too many headlines and a confusing economy is most definitely headed in the wrong direction. At least for now. Take advantage of this list. We will have down days. Keep the list handy. I refer to it many times. It's the right place to be even in a recession, which again is a possibility given how stuck much of the economy really is right now. Let's take calls. Let's go to Jesse in Tennessee. Jesse, Booyah. Jim, got a question for you about Dollar General Company stock. What do you think about them? The dollar stores? They've been beaten down. Yes. Now, here's what I did wrong with Dollar General. I first thought of it as having to do with tariffs and it's not a good situation. What I Didn't think about is how Dollar Tree is doing so poorly and getting offloaded. A lot of Family Dollar and a lot of Family Dollar stocks are right against Dollar General. And the Family Dollars are going to have a lot of going to close which gives a free reign for Dollar General. So where's that lead me? Even though it imports a lot from China, I say it's a buy. Wow. PJ in California. Pj. Hi Jim, this is PJ from Mariposa, California. Oh, fantastic. I'm an investment club member and I'm studying your four part on how to understand the income statement. I'm trying to become a good investor because I need knowledge. So that's what I'm looking for. I like you. I like everything you had to say just then. That was terrific to work. Okay, I bought Oracle. I pulled the trigger too soon. I bought it at 180. It's at 134. I think there's still a deal when we go through with Tick Tock. They're still trying to hammer it out. But what should I do with it? It's before I want you to buy more. I want you to buy more. I think that they're doing a lot of great things. I'm not as concerned about what's going to happen with the data centers. I am much concerned about what's going on with Oracle and they are very much in charge of their own destiny. I think softer Katz is terrific. I would buy the stock anyway. Excuse me. Sometimes boring is better for your portfolio and in this uncertain environment that's exactly what I think you need. On May Monday. Tonight you called in your own battle a company called ABM Industries. I'm bringing the top branch to give a better read on the name. Remember I said I liked it but let's find out more. Given the stock's string of post earnings declines on solid numbers, we gotta get some answers. Then fresh off and turbulent meet for the tape. I'm opening up the phone lines and answering your most pressing questions because are we at a bottom? That's what everybody wants to know. And later, OPEC cut its outlook for oil demand today. And I know a lot of you have oil stocks. How low could the price of crude go? Don't miss my check in with an energy expert. So stay with Kramer.
- [13:19]
Empower Financial
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.
- [13:42]
Fidelity Investments
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- [15:59]
Jim Cramer
We like to say what the most interactive TV show but a couple of weeks ago I got a call about a company called ABM Industries, which a facilities management company that serves customers across a wide range of industries. I said I like it because ABM is what you might describe as Trump proof, meaning it's mostly immune from the White House, impossible to pin down tariff policy. Now, even though I like it, the stocks had some strange reactions the last couple of quarters selling off despite what I thought were positive numbers, including when they reported about a month ago. I think this one's worth doing some digging here. So let's Take a closer look with Scott Salmers. He's the President CEO of ABM Industries. To get a better reading situation. Mr. Salmers, welcome to Manny.
- [16:36]
Scott Salmers
Thank you for having me. Really appreciate it.
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Jim Cramer
Well, it is a delight to have you on. I think that when we get. When we get questions, what I discover is we often have ideas from our viewers that are much smarter than the things I've been thinking about. I look at the makeup of what you do and I think you may be the quintessential service company that doesn't have a lot to worry about from a lot of the stuff we read in the news these days out of Washington. But I want to give you the floor because many people may not know your company. You can describe it better than anyone.
- [17:06]
Scott Salmers
That's great. Yeah. So essentially we operate and maintain commercial properties. Been around for 115 years, top 50 employer in the country, which is most people don't know. And we have four end markets. Prime office properties, manufacturing and distribution facilities, airports and then educational facilities, K through 12 and university. And in those end markets we have core services that we self perform, which differentiates us from a lot of service companies. And what we do is cleaning. We have over 5 billion square feet of properties that we clean. Yeah. Which is crazy. Right? And then manufacturing. In the manufacturing distribution fleet, we do a lot of engineering work which is stationary engineers that are taking the heating, the air conditioning. The infrastructure really runs across all of our end markets, to be frank. And then we also within that is parking. We're one of the largest parking companies in the country.
- [18:01]
Jim Cramer
Parking?
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Scott Salmers
Yeah, parking and shuttle. And then lastly what we do is energy resiliency, which couldn't be better right now that segment grew 22% last quarter. Everyone's worried about power right now.
- [18:13]
Jim Cramer
So how do you pick your verticals? You've got a bunch of verticals. I mean, I could say that maybe you have three companies. I don't know. I mean if they're all. If they're all humming that, you should be producing some pretty good numbers.
- [18:23]
Scott Salmers
We have been producing good numbers. We raised our guidance last quarter. Things have been going really well for us and we've shaped those verticals over time and we look at what's going on and the trends and we're agile now.
- [18:34]
Jim Cramer
The last quarter I thought read well and the stock got hit. To me seemed like an opportunity. But what are people missing?
- [18:42]
Scott Salmers
Yeah. So we put in a new ERP system which when you do that. Okay, plan friction.
- [18:49]
Jim Cramer
Right, right.
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Scott Salmers
Slow down some of our cash flow, which is what we're known for. But we knew this was going to happen. And you know what, Jim? If you don't make these investments in your tech stack.
- [18:58]
Jim Cramer
Right.
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Scott Salmers
How are you going to be able to leverage AI tools? And you have to have clean data. So, you know, we hate the fact that we're going through this right now, but by the back half of the year, we'll be back to normal. I think investors are missing that because.
- [19:09]
Jim Cramer
I was thinking maybe someone says commercial real estate's not that strong, but you're pretty even immune to that in a lot of ways. Correct.
- [19:16]
Scott Salmers
Because we focus on prime real estate.
- [19:18]
Jim Cramer
Right.
- [19:18]
Scott Salmers
And that's where the investments are happening. So that. So with all the real estate crisis you read about, our revenues have been down only 1% in that segment.
- [19:27]
Jim Cramer
Traffic slowdown in air, in airport.
- [19:30]
Scott Salmers
So it's. It's minor. Although anyone who's tried to get on a plane would tell you probably.
- [19:35]
Jim Cramer
Right.
- [19:35]
Scott Salmers
Right now. But we focus also on airport infrastructure. Right. So the airports themselves, which are more resilient. And if you think. Have you been to LaGuardia terminal?
- [19:44]
Jim Cramer
Sure. It looks gorgeous.
- [19:45]
Scott Salmers
We have 550 ABM in that terminal doing everything from parking your car to greeting you and wayfinding when you walk in, cleaning H Vac.
- [19:55]
Jim Cramer
So that's very interesting. I didn't know. I mean, we all kind of marvel. We often joke about how great LaGuardia is.
- [20:00]
Scott Salmers
Yeah.
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Jim Cramer
And a lot of it must be because you got a good contract. Yeah.
- [20:03]
Scott Salmers
And that's happening all over the country. Miami, lax, JFK for you. Yeah, yeah, yeah.
- [20:10]
Jim Cramer
Now, how do you find people? I mean, I was told when I was out in video that if it's dull and it's dirty and it's dangerous, it's going to be done by robots. What do you think can be done by AI and what can be done by people?
- [20:23]
Scott Salmers
Well, I think that's a long way off, frankly. But we do. But we do what? We're using robotics even today, but they're more like floor scrubbers and they have infused. So it's augmenting the work we have. And we actually love that because it provides more efficiency to our clients. So, you know, the age of humanoid robots is probably a little far off.
- [20:39]
Jim Cramer
Well, there was a say is because I have to imagine it's not easy these days to find people who are willing to do some of these jobs, nighttime jobs. Right.
- [20:48]
Scott Salmers
Really hard. You have to be an employer of choice. That's pay a fair wage, give access to benefits, training and development. We have so Many stories of first time immigrants coming into this country running hundred million dollar businesses for us. So we celebrate that but we properly vet them. Background checks e verify for i9 so you have to do all the precautions but you have to invest in your talent acquisition area.
- [21:13]
Jim Cramer
So on this question let's say someone's watching at home and they hear about the LaGuardia. Kenny, how do we keep track of all the contracts? This is a contract based business and the bigger the contracts obviously once we get through the ERP stuff you could really shine. I want to be in on this.
- [21:28]
Scott Salmers
Listen, we have eight and a half billion dollars of revenue. We've been consistent even through recession recessions. So we can we're considered honestly the most resilient company out there in the services because we have three to five year contracts. So it transcends any administration or economics cycle. And I have to tell you Jim, even if you go back to the 0709 recession, RTSR was up 3%, the S&P was down minus 10%. So we go through these cycles. It's the resilient business model is just brilliant for us.
- [21:59]
Jim Cramer
You are an exciting unexciting company.
- [22:02]
Scott Salmers
That's exactly right.
- [22:05]
Jim Cramer
Wow. Scott Salmers, President CEO of ABM Industries, you asked about absolute, we delivered and I've got to tell you this is the kind of stock as you heard from the top of my show that I am really really interested in. They have money's back here.
- [22:21]
Empower Financial
Coming up, Kramer's opening the phone lines. Get your biggest market questions ready. Kramerica. We're turning the mic over to you next.
- [22:34]
Fidelity Investments
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- [22:53]
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- [23:28]
Jim Cramer
Well the tariff exemptions that looks like they're coming. Market was eager to take a sigh of relief. I'm not so sure whether where we are with them but the major average sure jumped higher on President Trump's announcement of temporary exemption on tariffs for phones, computers and semiconductors. And really, I guess the subtext is for Apple. But in a tape this volatile, we have headlines dropping left and right. I've got to tell you, I spend so much time trying to figure out what's going on, but I think that periodically I nail it. So tonight, what I want to do is open up our phone lines to hear directly from you, from the people of America, ahead of, by the way, when we do our Wednesday Club meeting, which is at noon. Let's do this together. Let's start with Todd in North Carolina. Tad.
- [24:09]
Rusty Brazil
Hey, Jim.
- [24:10]
Jim Cramer
Hope you're doing well today. Hey, man, how you doing? What's going on? I'm doing all right. Hey. Calling about a company that I once held a considerable position in, but thankfully got out of before the bottom completely fell out. But I'm wondering if now might be the time to start rebuilding my position in ELF Beauty. Oh, my. Okay. I'm so glad you asked about this. This is at the fulcrum of what I've been working on. ELF has a connection to China, obviously. That's where they make their stuff. That's why they've been able to undercut everybody else in price. Now all we know is that it's up in the air. What's going to happen with elf? We don't know what kind of tariff it's going to pay if we don't know what kind of tariff it's going to pay, that I can't spend $53 for that stock. It's just not right. And what would happen is I couldn't sleep at late at night telling Tad in North Carolina it's fine. And that's why I'm staying away from ELF Even as I think that everyone knows I think Tarang Amin is a terrific CEO. It doesn't matter. It's out of his hands. Next up is Brandon in Texas. Brandon. Well, howdy, Coach Kramer. Hey, man, how you doing? Hey. I'm just going to keep it simple for you. I'm looking at General Mills GIS at 59. Are you a buy or no buy? Okay, you're going to absolutely love this because I got a new rap on General Mills. I think General mills with a 4% yield and a 59 is a buy. Let me tell you why I think that our Secretary of Health and Human Services is dead set on ultimately against the GOP Dash one drugs. I think he's going to make trouble for him. We Own Eli Lilly. It has been just a, just a terrible stockdome for the last few months. And I think General Mills is the flip side. I think they're going to take the color out of the, out of the cereals. That will be fine. And then they're going to be left alone and people are going to want to buy it. So let's say they're going to take action. If they take that action, then, then, then Bobby Kennedy Jr. Decides to leave him alone. $59 goes to 65. I like your idea. Let's go to. How about we go to Neil in New York? Neil? Hi, Jim. I have a bad pun to ask you as American Airlines ever going to take off again? You know what I am, I'm bummed about American Air. Do you know that it's back to where it was during COVID times. And it's really a shame because they're a better company than that. I know that people don't like the stock, but if you want an airline, the one that people are buying is Delta. It's all the way down to 40. It sells at seven times earnings. People feel that the travel bull market is over. I regard these as what I call trading vehicles. But if you want to trade one, the one you want to trade is Delta D L I want to go to Lillian in Kentucky. Lillian.
- [26:59]
F
Hi, Jim. How are you doing?
- [27:01]
Jim Cramer
I am doing fine, Lillian. How about you?
- [27:03]
F
All right, listen, I did write to you about how nice and healthy you look and younger than when you joined CNBC 20 years ago. So anyway, I wanted to talk to you about something that people can prepare to do with their IRAs if it works out for them and their financial advisors agree. I did this last week when we had a crazy day when everything was down, which is that I took some stocks and I moved them into my Roth IRA from a traditional ira. And then I had some good stocks that were down, so I sold them, took some losses. I did buy some good stocks that were also down. And then, and then the other advantages I. Is that your RMD that you have to take in January if you don't need the whole thing, it's based on what's in your traditional ira. So you have any thoughts about this or who it might work?
- [27:58]
Jim Cramer
Yeah, I mean, you know my view on these. These are personal decisions. And the reason I say the personal decisions is it depends when you want to retire, how much you're making and when you want to take the hit. I like to be able to put the. I am a big believer that there'll be giant capital gains because I got it right. And so I want to be able to tell my accountant, look, I think a big capital gains, which is the best way but I had in this particular show am supposed to be able to give the recommendation of that you should need to speak to your accountant on the situations where let's say you think you have big capital gains. What do they think? If they think you just have capital gains over time, what do they think? And I'm not trying to punish just that to give you that individual information without knowing your circumstances is going to do you, I don't want to say would do you harm, but it's just I just can't do that without sitting down with you. And I don't want to act as if I am your advisor. I can't do a good enough job. So that's my advice to you. But thank you for having the confidence in me to ask that. But I will not be able to make that specific call for you. Let's go to Anthony, New York. Anthony.
- [29:04]
Scott Salmers
Hey Jim, thanks for taking my call.
- [29:06]
Jim Cramer
I'm a longtime follower and a club member.
- [29:08]
Scott Salmers
So thanks very much for everything, you.
- [29:10]
Jim Cramer
And your team and I hope you're going to be in our Wednesday call. We're going to take some questions but we also have, as you know, we're having some difficult times with some of our favorite stocks. But that's okay. We'll solve that too. How can I help you? Yeah, I'm sure Jim, My retirement date is coming up pretty fast, like likely at the end of this year. And with the market turmoil and stuff, it's got me a little bit on edge. Even though my financial advisor tells me all things are going it's not an issue. There's one loose end that I'm not sure what to do. I have to take RMDs for an inherited Iraq that it's a sizable IRA. So I don't know where the best place to put that cash is. Just in a high. Okay. Right now you can get, you know, I mean I was going over this with my, my cfo. I cannot believe how much money you can make in these high yielding funds. The high yielding fund at Vanguard, it is just awesome high yielding fund right now. Fidelity. These are places where I typically everyone's so worried will they cut rates? Will they raise rates? They're missing the point point about what you and I do, okay. We are individuals. We can't, we're not worried about what the 10 year is going to do. Or the 20 year or what. The more we know that you can get a rate that is so high right now it is the equivalent of risk free and it's not going to drop anytime soon because the Fed can't cut anytime soon. That's where you want to be. It is such a sweet spot. It's unbelievable. We talk way too much about negatives. The positives is how much you can make in that high yield fund right now. It's worth doing right. Look, the current environment has made it difficult to know what the right move is for your money. But rest assured that we're trying to find the best opportunities out there every single day. What's more money at as oil prices slide, I'm looking at the global energy landscape with the founder of RBN Energy. He's our expert. Then what should you make of the decline in the dollar? It's kind of like what I just talked about with that gentleman. There are two worlds. There's the world where we're appealing to hedge funds and I was a hedge fund manager and I don't care about that. And then there's the other world. We're appealing to you. That's what I'm from. Rapid fire calls to lightning. Stable oil prices finally snapped a two week losing streak today. But with cutting instruments demand outlook, how do we get our heads around this energy market? It's a crazy moment where the President's constantly fluctuating tariff policies. Does it put a real damper on global growth? And when there's less growth, obviously there's going to be less use for oil. But then with the crude at 61 bucks, it should come down a lot. How low could it go? Whenever I needed to set this business, I want to check in with the smartest energy analyst and the game. That's Rusty Brazil. He's the founder and executive chairman of RBN Energy. Was magnificent track record with us. Rusty, welcome back to Mad Money.
- [31:59]
Rusty Brazil
Yeah, I'm great to be with you again.
- [32:01]
Jim Cramer
Okay, so Rusty, if you had told me that we had President Trump and there would be the kind of policies that he brought in for 2016, I would think well would be at 80 bucks oil. The demand keeps being lowered. OPEC cuts demand forecast. Obviously we can't keep the price up. Today was an aberration. Where can oil go?
- [32:22]
Rusty Brazil
Well, if OPEC does what they say they're going to do and we end up with a weaker economy like a lot of folks are afraid of because of the tariffs, then we could very well end up being at 50 bucks, I don't think we're going to 50 bucks. But if we do, it's going to affect the amount of drilling we're doing. At $60 we're still most producers are still profitable, particularly those that are in the Permian. So at 60 bucks we're okay. 50 bucks we're not okay.
- [32:47]
Jim Cramer
All right, so explain to me whether the discipline that we saw which meant that we didn't just drill baby drill is still in place versus what the President wants. Because the president's key to his anti inflation program is much lower oil price.
- [33:05]
Rusty Brazil
Well, he's got much lower oil prices. I don't think this is exactly the way he planned on getting there. But the situation is you cannot have drill baby drill and have that much more production coming out of the ground and at the same time have lower, lower oil prices. It doesn't make any sense. So I think we're going to talk after a while about Chris Wright. And he's got a pretty hard job on his hands because he's got to figure out exactly how to do that. I think it's going to be a tough job.
- [33:38]
Jim Cramer
Let's go to Chris Wright. Exactly. I said is the part of energy first time I've seen part of energy person who actually knows about energy. Candidly, I don't mean to slag everybody else's hat, but this has been without a doubt a backwater and then suddenly this is the maybe he's the most important cabinet member there is other than the people involved with tariffs. He is a different kind of energy secretary. Could you describe who he is, what he does and how he's in the middle of this whole issue?
- [34:07]
Rusty Brazil
Well, he runs a drilling company. He runs a company that basically fractures fractures shale. So he knows the industry. He's been in the industry for a long time. He's written a lot about it. He is clearly a policy guy who understands what it's going to take to make energy production increase. He's already accomplishing a lot of things. He's approving LNG facilities, he's reducing regulations. He's working on a big project out of Alaska. But he's got the problem with his boss that his boss wants drill baby drill. At the same time we have lower crude oil prices or lower energy prices and that's going to be tough.
- [34:47]
Jim Cramer
Okay. Is he opening up any areas other than Alaska that are actually useful? Because one thing I often hear about is going to open up this area but that area. But really everything's kind of set in stone by the Companies that really do the, that already made their decisions.
- [35:02]
Rusty Brazil
It's set in stone at 60, $70 crude oil prices. If crude oil prices were higher than the areas that he's opening up would make more sense. But at, at these prices, those wells are simply too expensive for the production that you get out of them. So practically speaking, you're right. You can open up all the areas in the world, but that doesn't mean there's going to be that much more drilling.
- [35:25]
Jim Cramer
Okay, how about LNG in terms of our export? We know that there was basically a kind of, there was a pause put on by the Biden administration, but it was a pause to look like it may never end. That's obviously changed. Where are we in terms of development? Where do you see us five years from now?
- [35:44]
Rusty Brazil
Well, the five years from now we're going to be almost double the amount of LNG that we're exporting right now. So it's going to be huge. There's a number of new facilities coming on. The pause has been unpaused. So everything is working the way it's supposed to, except for one thing, and that is the fact that the market is very concerned about all the uncertainty that we're dealing with right now. If you're dealing with somebody who is going to make a commitment for billions of dollars over not just five years, but over 20 years or 30 years, then they're worried about just exactly how much certainty they're going to have in the marketplace in order to be able to make the decisions they've got to make. And when the market's flip flopping the way that it's been over the last two weeks, where we have a different world every, every morning, it's hard to make those 20 year decisions.
- [36:36]
Jim Cramer
Well, how about a decision involving data centers? We know the data centers are humongous users of energy. I was shocked when Microsoft went open a three mile when we have so. But we have so much natural gas, one would cost a fortune, the other would not. Where are we with these companies that want pure, clean energy and dirtier natural gas that they just may have to accept if they want all that power?
- [37:01]
Rusty Brazil
Well, I'll disagree with you about dirty natural gas. I think natural gas is pretty darn clean. But, but in terms of the data centers, what we have done is we have issued scores of press releases. Everybody wants to build a data center and everybody wants to jump on the, on the AI gravy train and be able to generate a lot of gas either with a lot of electricity, either with natural gas or with renewables or something else. My sense is that it's been overhyped. There's not nearly as many of these things that are going to be built as that folks are talking about right now. But it is the largest increase in natural gas demand for power generation that we've seen a long time. So for the gas industry, it's a good thing.
- [37:47]
Jim Cramer
Now at the same time, we've got a glut of chemicals that people don't seem to realize we've got. There were many, many. You know, there's just gigantic infrastructure about what to do with liquid natural gas away from just shipping it. Where are we in terms of all the other energy that you know, the ethanes, the propanes, where are we with those? Because that's something we dominate in the world. World.
- [38:13]
Rusty Brazil
Well, a lot of, most of the folks that are looking at exports right now and what's going to happen are looking at the Chinese thing, the side of things. In the US We've exempted energy from the tariffs, so that means at least we don't have to worry about that anymore. But China's retaliatory tariffs of 125%, they include energy products. Good news is that oil is really. About 6% of our exports are, are of oil are going to China. So the fact of the matter is that we'll just simply take our oil someplace else.
- [38:49]
Jim Cramer
Wow.
- [38:49]
Rusty Brazil
And it's not going to hurt the Chinese. They're going to replace, they're going to replace their oil with, with something from the Middle east or somewhere else. It's not that big a deal. You know, for LNG, same about 5%, 5% of LNG, not a big deal for, like you said, for NGL, for propane and ethane particularly, it's a bigger deal because they get a bigger chunk of the export pie.
- [39:11]
Jim Cramer
Well, I got to tell you, I think it's a convoluted moment. I think that if oil goes down more than all bets are off because these companies, our companies won't know what to do. Oil goes up, obviously, that would be incredible, but it just doesn't look like it's going to. Rusty, I just don't see the move to 60 to 70.
- [39:30]
Rusty Brazil
Well, as you know, I really don't like to forecast prices.
- [39:34]
Jim Cramer
Right, I know, I know.
- [39:35]
Rusty Brazil
But, but, but on the other hand, the problem is the uncertainty. Our, our clients that we talk to every day are simply saying we're going to sit on the sidelines. We're not going to do anything while until this thing settles out. And that has an implication for oil prices, for infrastructure construction, for everything that goes into a marketplace. The marketplace is deer in the headlights right now. And that's the way it's going to be until we start seeing some sort of stability.
- [40:03]
Jim Cramer
Still one more industry where we don't know what's going to happen. It does get unnerving after a while. Rusty Brazil is the founder executive chairman of RBN Energy. Thank you, Rusty, for making some sense of it. Appreciate it. Man's back after the break. It is time. It's time for the White Rockers. Rance, right. Robert Cole's Army Stadium Stocks Center. Bye bye Cole Stock Quad Center. My Stanford Grams with Blake Planet Sound. And then the lightning round is over. Are you ready, ski Daddy? Time for the lightning round. Crazy. Let's start with Raymond in Pennsylvania. Raymond, hello, J.M. raymond calling from Pittsburgh, the city of former champions. Thanks for taking my call and thanks for all that you do for investors. Thank you. While researching opportunities in the energy sector a few years ago, I came across a little known shipping company that is a pipeline on the seas. I bought Ardmore Shipping Corp. At 15. Watched its sale to the low 20s, but it has since sunk to around 10. Company has a modern fleet, decent balance sheet, paying down debt. PE less than 3, but a dividend around 10. Okay, tread water and hold or buy more. Well, I don't, I don't like the situation because a lot of what it carries is tariff and it's going to cause a real slowdown between the United States and China. You just can't get in this cross. You don't want to be in this crossfire. And so I'm going to have to say no to Ardmore Shipping. Let's go to Linda in New Jersey. Linda.
- [41:38]
F
Hey, Jim, first time caller.
- [41:40]
Jim Cramer
I'm a little old lady.
- [41:41]
F
I'm wondering if people are going to bail on their expensive gym and move on over to Planet Fitness. And I want to know if that's a good buy.
- [41:51]
Jim Cramer
You know, I do a memo each morning where I do the 10 things that I'm looking at and it starts with a list of about 25 things. The only positive numbers I saw, only raising price target that I saw today was Planet Fitness. So I took a look at it. They are doing better than expected. I think you have a winner. Let's go to Douglas in virginia. Douglas. Booyah. Mr. Kramer, thanks for taking my call. Of course. Booyah. What's up? I'm looking at a company that's based in Houston Texas. They design and install the integrated power and control systems for factories when you put them in. And they've done it in the petro, data centers, utilities, mining. The last first quarter of this year, they earned 286. They're expected to earn 344 this coming next quarter. In Q2, they have a PE of 13. Jim, the company is Powell Industries. I know Powell Industries. And it was in favor of kind of like an Emerson not that long ago, and suddenly it's out of favor. If you're willing to hold on for the next cycle, it's fine. But I've got to tell you, it's considered to be a data center play. And people think that data centers are slowing down. And that's the case with Powell Industries, too. I'm sorry, I wish I could be more positive. It's a very inexpensive stock. Let's go to Max in Illinois. Max, Mama. Mad Money. This is max. I'm looking 3M, what do you think? Okay, 3M is going to report in eight days. And I think the quarter is going to be good. But I don't know if anyone's going to care because it's a big international and right now big internationals are really frowned upon. But you know what? If you can own it through the cycle again, I think it is a good situation. And that, ladies and gentlemen, is the conclusion of the lightning round.
- [43:38]
Empower Financial
The lightning round is sponsored by Charles Schwab.
- [43:49]
Jim Cramer
When you're talking about this market, the worst thing is that everybody's got a political axe to grind and it gets in the way of the truth. So let me give it to you then, straight from the gut, the way Jack Welch would say. First, we keep hearing that interest rates have gotten out of control, that 4.5% of the 10 year is the end of American exceptionalism as we know it. A sign that President Trump's trade policy has permanently tarnished U.S. treasuries. Well, how about the 5.02 10 year that we had on October 23, 2023 rate? I guess that was the opening chink in the end of American exceptionalism. Somehow it didn't matter when the 10 year went over 5% under Biden, but when it touches a 4.5% under Trump, it's the end of the world. Weird how so many people making this argument, Democrats then we're told that what was really disconcerting was the speed with which it went from 4.0 to 4.5. Listen, that certainly wasn't great, but markets are a little thinner than they used to be. Even the treasury markets acting erratically. Once you let politics influence your assessment of the markets, that's the death of good decision making in this business. You need a clear eyed view of reality, not a worldview that magically aligns with the preferred political outcome that you like. And that goes by the way for Republicans and Democrats. But the biggest canard I've heard lately is the endless handwriting about the weak dollar. We're told that means it'll be harder for our country to attract foreign investment. I'm going to call this one out directly. Sure. I love seeing foreigners in our myriad bond offerings. It would be be a problem if they all flip. You need foreign investment. Unless you have a bond auction that fails or one that causes interest rates to spike because we have so much darn debt. We don't want that. But the vast majority of American companies, which is what we talk about on the show, the ones that do business overseas, they desperately want a weak dollar. It makes their exports more competitive. It's why so many countries deliberately weaken their currencies. Tomorrow morning JNJ Johnson Johnson story Companies going to port. I have no idea what number they'll print, but I predict that there will be several references made to constant currencies and how much money the company would have made if the dollar just remained steady. That go down. This stuff has been going on for years. On every conference call, every company that any international consumer business has experienced it. The worst situation is when we have to wonder how much market share was lost to it to the strong dollar. It's been killing our companies versus other companies not based here. Don't believe me? Wait until the Proctor and Gamble call. It's a nightmare because of the strong dollar versus all the other currencies. The strengthening dollar has become a staple of these calls and it's hurt our companies competitively for ages. Coca Cola constantly first the strong dollars. It should. It plays havoc with an amazing international business. Every drug company will report the woes of the strong dollar. Companies that make the basic building blocks of society, the chemicals, the papers, they're always defeated by the strong. A lot of the tech companies defeated by the strong dollar. So now we have these people who act as if the dollar's been teetering all along that it's in a desperate death rattle so foreigners won't be buying our bonds and interest rates are going to soar. You know what? That's ridiculous. Every exporter wants once a weaker dollar. Obviously it's not good for consumers, but given the scale of the tariffs we're about to experience these currency fluctuations, they are marginal. Well, no doubt here that the reason the 10 year is going down in price and up in yield is because the declining dollar. I say it's the cost of being competitive and you better get used to it. Look, there are a lot of things that have been handled poorly with this tariff rollout, but you'll never catch me complaining about a weaker dollar. Like I said, there's always more markets on my promise. I find just for you right here on My Money, I'm Drew Kramer. See you tomorrow.
- [47:22]
Fidelity Investments
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 trading@schwab is now.
- [48:02]
Empower Financial
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