Podcast Summary: Mad Money w/ Jim Cramer – November 26, 2024

Host: Jim Cramer
Produced by: CNBC
Release Date: November 27, 2024

Market Overview

Jim Cramer opens the episode with an analysis of the recent market movements, emphasizing the resilience of mega-cap stocks. He underscores the importance of not undervaluing these giants, referencing their ability to rebound swiftly.

• Quote: "Remember today. Remember it because it's a textbook reminder of what happens when you decide the mega capitalization stocks are done."
  Timestamp: [00:48]

Cramer highlights the performance of major indices, noting slight declines but overall record highs in certain sectors:

• Dow Jones: inching up 124 points from a record high despite a minor dip.
• S&P 500: advancing 0.57%.
• NASDAQ: up 18.63%.

He attributes the upward movement to the collective strength of mega-cap stocks, likening them to "Santa's reindeer."

Spotlight on Mega-Cap Stocks

Apple Inc.

Cramer discusses Apple's position amidst legal challenges:

• Issue: Apple faces significant losses due to a Justice Department case against Google's financial arrangements as the default search engine.

• Impact: Despite theoretical setbacks, Apple's stock shows resilience.

  • Quote: "Google pays something like $20 billion a year for the privilege. So why is this not going up?"
    Timestamp: [00:31]

He speculates that improvements in U.S.-China relations, exemplified by pending tariff negotiations led by Tim Cook, have buoyed investor confidence.

Tesla Inc.

Cramer acknowledges Tesla's strengths while cautioning against overvaluation:

• Quote: "Tesla is a big winner too, as long as it doesn't improve too much because the Chinese have some amazing electric cars that they're already facing 100% tariffs here."
  Timestamp: [00:34]

He highlights the strategic importance of the Chinese market for Tesla, despite competitive pressures and tariff concerns.

Amazon.com Inc.

Cramer praises Amazon's solid fundamentals across e-commerce, cloud computing, and online advertising.

• Quote: "Amazon's got a knob from Bank of America. This one's pretty generic. It's talking about the strength of E-commerce and the cloud and online advertising."
  Timestamp: [00:31]

He emphasizes Amazon's consistent delivery of positive results, which is rare among companies.

Microsoft Corporation

Cramer delves into Microsoft’s recent performance:

• Performance: Mixed results due to external factors like softer earnings from partners like Best Buy.

• Future Outlook: Optimism about Microsoft's AI initiatives, despite current challenges.

  • Quote: "Heinous action of the rest of retail. Analysts talking about rising inventories and pausing about... I refuse to play that game. Dix is a buy."
    Timestamp: [07:51] (Paralleling Microsoft analysis)

Nvidia Corporation

Nvidia faces skepticism despite strong earnings:

• Challenges: Concerns about peak growth rates, increased competition, and market saturation.

• Defense: Cramer defends Nvidia’s market position and technological superiority.

  • Quote: "Nvidia still has the best technology by far. In my view, it has no competitors."
    Timestamp: [02:10]

He also discusses Nvidia’s innovative projects like Fugato, an AI idea factory, underscoring the company's commitment to long-term growth through innovation.

Retail Sector Earnings

Cramer provides a rapid-fire analysis of recent retail earnings, likening his recap to ESPN’s Chris Berman’s NFL summaries.

Burlington Stores (BURL)

• Performance: Soft revenue with 1% same-store sales growth, below expectations.

• Outlook: Trimmed full-year same-store sales forecast.

  • Quote: "Burlington reported soft revenue... If not for poor sales in cold weather categories."
    Timestamp: [08:02]

Cramer suggests alternative off-price retailers like TJX as better investment options.

Dick's Sporting Goods (DKS)

• Performance: Strong earnings and revenue beats, with 4.2% same-store sales growth surpassing expectations.

• Market Reaction: Initial stock rally tempered by broader retail sector concerns.

  • Quote: "Dick's delivered a $0.07 earnings beat off a $2.68 basis higher than expected revenue 4.2%."
    Timestamp: [08:34]

He reaffirms his bullish stance on Dick's Sporting Goods despite short-term stock movements.

Best Buy Co. (BBY)

• Performance: Mixed results with weaker than expected earnings and reduced guidance.

• Outlook: Cautious, with lowered full-year forecasts and diminished same-store sales.

  • Quote: "Best Buy's results weren't terrible, but they also weren't great... Likely a seller, not a buyer."
    Timestamp: [09:08]

Cramer expresses skepticism about Best Buy's near-term prospects.

Kohl's Corporation (KSS)

• Performance: Disappointing earnings with significant declines in same-store sales and overall stock performance.

• Leadership Changes: CEO Tom Kingsbury announces plans to step down due to poor performance.

  • Quote: "Same store sales down 9.3%... a 70% decline. It was just miserable."
    Timestamp: [09:08]

Cramer highlights the bleak outlook for Kohl's, signaling potential long-term struggles.

Abercrombie & Fitch Co. (ANF)

• Performance: Impressive quarter with earnings and revenue beats, yet stock fell post-announcement.

• Outlook: Raised full-year forecasts but cautious on the current quarter.

  • Quote: "Abercrombie delivered a top and bottom line beat... Still, it flushed lower right away."
    Timestamp: [09:25]

He sees Abercrombie as a buying opportunity despite market overreactions.

In-Depth Company Analysis: Intuit Inc. (INTU)

Cramer revisits Intuit following a surprising stock drop post-earnings announcement, despite strong performance metrics.

• Issue: The market reacted negatively to conservative guidance for the upcoming quarter, overshadowing a solid earnings beat.
• Performance:

  • Earnings: Beat expectations by 14 cents per share.

  • Revenue: Grew 10% year-over-year.

  • Credit Karma: Accelerated growth at 29%, providing a significant boost to Intuit's consumer segment.

  • Quote: "I actually think that the stock going down was wrong. ... opportunity to step in and get some on the cheap is finally upon."
    Timestamp: [28:14]

Cramer defends Intuit's long-term prospects, emphasizing robust performance in diversified segments beyond TurboTax, and downplays concerns over potential government alternatives to tax filing services.

Interview: Enrique Lores, CEO of HP Inc.

Enrique Lores joins the show to discuss HP’s recent performance and strategic initiatives.

Quarterly Performance

• Revenues: Grew by 2% with both personal systems and print segments showing growth.

• Margins: Experienced pressure due to increased costs, impacting PC divisions.

  • Quote: "We grew share in personal systems, especially in commercial... pressure from a cost side component."
    Timestamp: [30:38]

AI Integration in PCs

Cramer probes HP’s AI strategies, linking to Best Buy’s optimistic outlook on AI advancements.

• AI PCs: HP is launching next-generation AI-enabled PCs, focusing on on-device AI capabilities to enhance productivity.

  • Quote: "Our goal next year is to grow more in the commercial side... the capabilities and the new applications that customers are going to be able to do."
    Timestamp: [36:13]

Lores emphasizes the gradual adoption of AI PCs, expecting significant productivity gains as software integrations mature.

Supply Chain Resilience

Discussion on HP’s efforts to diversify manufacturing beyond China to mitigate tariff impacts.

• Quote: "We have been diversifying fairly aggressively during the last three years... build a more resilient supply chain."
  Timestamp: [37:01]

Lores outlines HP's proactive measures to enhance supply chain robustness amid geopolitical uncertainties.

Lightning Round Highlights

Jim Cramer engages with callers, offering concise stock opinions:

1. Joseph from Connecticut (Intel Corp.)

   • Cramer's Take: Moderate growth expectation; prefers AMD over Intel for higher potential.
     Timestamp: [08:02]

2. Sam from Pennsylvania (Nike)

   • Cramer's Take: Negative outlook due to impending tariffs; advises caution.
     Timestamp: [08:34]

3. Larry from Florida (AeroVironment)

   • Cramer's Take: Positive on AeroVironment’s long-term demand despite short-term cuts.
     Timestamp: [09:08]

4. Mark from New York (PayPal)

   • Cramer's Take: Strong buy; highly favorable towards leadership under Alex Chriss.
     Timestamp: [28:14]

5. Andy from California (Super Micro)

   • Cramer's Take: Sell due to accounting irregularities; maintains a firm stance against returning to such stocks.
     Timestamp: [40:38]

6. Daniel from Florida (Red Cat Holdings)

   • Cramer's Take: Pass on Red Cat Holdings despite high returns; prefers more stable investments.
     Timestamp: [41:04]

Final Remarks and Crypto Commentary

Cramer addresses feedback on his previous series about market froth and discusses his stance on cryptocurrency:

• Crypto Perspective:
  • Opinion: Skeptical yet sees crypto as a potential hedge against government fiscal mismanagement.
  • Quote: "I own crypto because those national debt worries are never going to go away."
    Timestamp: [43:00]

He reiterates his belief in the necessity of diversification and hedging against possible economic instability through assets like Bitcoin and Ethereum, despite recognizing their volatility.

Conclusion

Cramer wraps up the episode by reinforcing his investment philosophies:

• Key Takeaway: Capitalize on sector-wide weaknesses to acquire high-quality stocks at discounted prices.

• Final Advice: Maintain a disciplined approach to investing, emphasizing the importance of taking profits to avoid turning gains into losses.

  • Quote: "The biggest sin in investing is turning a gain into a loss."
    Timestamp: [43:50]

Jim Cramer signs off with well wishes for Thanksgiving, encouraging listeners to apply the episode's insights to their investment strategies.

Note: All quotes are attributed with their respective timestamps for reference.