Transcript
Jim Cramer (0:00)
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Jim Cramer (0:02)
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Jim Cramer (0:04)
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Jim Cramer (0:23)
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Jim Cramer (0:24)
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Gregory (0:32)
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Jim Cramer (1:22)
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 a special San Francisco edition of Man Money. Welcome to Cramer. I'll be with my friends. I'm just trying to make a little money. My job is not just to entertain, but to educate you. So call me at 1-800-743- CNBC or tweet me. Jim Cramer. Sometimes, reluctantly, we Wall street has to think long term. I say reluctantly because in this business, if you're talking long term, that usually means you either missing numbers or you're dead. That's what I keep thinking as we swoop down the second day of the JP Morgan Health Care Conference, which is filled with CEOs who are talking about the future of health care, even as most investors would say, hey, listen, tell me what happened today. So here's what happened. Dow Vades 221 points, S&P advanced.11% and the Nasdaq lost 0.23%. Why am I so willing to focus on the so Called out years because the long term possibilities for these companies, frankly, they're incredible. By the way, incredibly lucrative too, even as the present is good, but not great. So at the risk of antagonizing the day traders out there, let me tell you what I saw today give you a prelude to some of our amazing guests. I want to start with a stock that got pummeled today. Eli Lilly pulverized. Here's a company that preannounced 58 to 61 billion dollars in revenue next year, substantially better than expected on the back of those GLP1 drugs approved for diabete, weight loss and now obstructive sleep apnea. There's just one problem here, Louis. Fourth quarter estimates, the fourth quarter that we just finished, they aren't as strong as Wall street was hoping. So it went from the best of the best of the worst of the worst, finishing at the bottom, the S&P 500 today, which is saying some because there are 4,99 other companies that index that perform better than this colossus. So why am I not perturbed? Why not like everybody else running for the hills? Why did we tell people in the CBC investing club that we take advantage of the decline to do some buying after selling quite a few shares at much higher levels? I feel very alone on that. Well, I'll tell you why. See, I'm thinking that Luly's wonder drug Mujaro, also known as Zepbound, has way too many potential indications to write it off because of one subpar quarter. This drug I believe will work against hypertension, known as the silent killer, heart failure, complicated liver disease, joints, dementia and yes, heavy drinking. It has so many uses that really spending $20 billion to build up manufacturing so it can meet the demand, even though there's a very capable competitor, Novo Nordisk and there are a lot of companies trying to get in the space. These GOP1 drugs are not easy to make so that spending is the secret moat that will keep the competitors at bay. Hey, but short term they admit that they haven't done a great job launching the drug. I'm not thrilled about that either. I got to tell you however, I can't think of a better chance to buy the stock on weakness given that Mounjaro is growing faster than any other large drug. So let me ask you, do we want the fastest ramp up or do we want the biggest drug of all time? The so called community of analysts wants the former. I'll take the latter any day of the week. Oh, did I mention they'll soon have this weight loss drug in pill form, not just injectable for those who don't like to give themselves a shot once a week. Of course, it's not just the botched launch that's holding Lilly back. Bobby Kennedy Jr. Trump's nominee for health and human services is universally known as an anti vaccine proponent. Now that's true, but you could also think of him as a believer in diet and exercise. He's not a huge fan of the GLP1 drugs, but the food industry has made that diet and exercise regimen almost impossible for most people. So why not let those who can't diet or exercise enough take the shot? Oh, let me give you another negative here. Yes, the giant head and shoulders pattern in the stock chart. Any chart that's worth his salt knows that they pictograph what that spells. So short term things may look ugly for Lilly. I'm sorry, I'm a long term believer. I say that you want to buy or how about Merck? Okay, now here's a company with the single greatest anti cancer franchise of all time. It's called Keytruda. But I think it's not getting enough credit for an acquisition it made in 2021. That was a purchase of Acceleron for $11.5 billion. With that acquisition they got this drug called win review. It is approved by the FDA just this last year for an almost always fatal disease called pulmonary arterial hypertension. This is a drug that according to Merck's very non promotional CEO Rob Davis has quote pulled people back from the brink of death. He goes on to explain that sick people who use this drug are now I'm going to quote alive and may have to go back to work again. Win some, lose some. They also have a shot, Gardasil that protects against hpv. It's very common STD that can cause cervical cancer. It's a true lifesaver. Women have been using it for years. Chinese government recently approved it for men too. But for some reason Merck's having a problem with its Chinese distribution and women. Weird situation going over there right now. The stocks well ensconced a few points around 52 week low. I don't think it's going to stay down there, but I can't tell you how long it'll take for Merck to bounce back. So does that mean sell? Sure if you're a day trader, but not if you're an investor. How about Regeneron? Now here's a stock that traded at 1211 in August of last year. Now, after declining nearly 4%, today alone it sits at 690. Wow. The issue Regeneron has this fabulous eye care franchise being challenged by an Amgen Biosimilar. By the way, that's a biotech version of just a generic drug. But that's all Wall street cares about. Doesn't matter. Regeneron is working on 40 different compounds, many of which could be blockbusters. Doesn't matter if their breakthrough drug Dupixent is indicated for seven gigantic illnesses. Asthma, eczema, nasal polyps. This company has never lost its ability to develop new medicines, including the one that likely saved President elect Trump's life when he caught Covid near the end of his first term. For now, none of that seems to matter. But you know, one day it will. I still can't believe that Avid Labs, perhaps the most diversified health care company in the world with some of the greatest growth franchises, has a series of lawsuits hanging over its head, crimping its price earnings multiple. I think Abbott will win these baby formula cases yet. Who wants that overhang, right? Certainly not Wall Street. So what does the stock do? It languishes. Who knows how quickly things can change. Yesterday give you example, we had Jeff. Martha, he's the CEO of Medtronic. That's another stock that hasn't done anything lately. I thought he told a great story about all the new policies. Rolling out lifesaving products nobody seemed to care about. Was a big yawn today when the stock was one of the best performers. The s and P500 up 4%. I remember what he said yesterday, which is things are pretty darn good. It does make a difference. Look, stocks go in and out of style in the Wall street fashion show, you know that. I've taught you that whole sector's wallow at times. Right now health care's in some sort of doghouse, the likes of which I've never seen. Should I've got to tell you, companies with terrific multi year growth prospects, should they really be kept down by rising interest rates? Political headwinds. To me, that's precisely why these health care stocks are currently so cheap. Hey, call me a miser, I like cheap. But the bottom line. Ask yourself what happens if things get better? Please. What if the future is brighter than the past? If that's the case, and I think it is, then you have a lot of winners with these drug and medical device plays. Glad I could be here to tell you their stories. Let's take questions. Let's go to Gregory in California. Gregory. Happy New Year, Jim.