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Mad Money w/ Jim Cramer 5/2/25 - Mad Money w/ Jim Cramer | Wave AI Podcast Notes

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Mad Money w/ Jim Cramer 5/2/25

Mad Money w/ Jim Cramer

Fri May 02 2025

Summary

Mad Money w/ Jim Cramer – Episode Summary (May 2, 2025)

On May 2, 2025, Jim Cramer hosted another insightful episode of “Mad Money” on CNBC, guiding investors through the bustling landscape of Wall Street with his characteristic fervor and expertise. This episode, commemorating the show’s 20th anniversary, delved deep into market trends, earnings reports, and featured engaging interactions through the Lightning Round. Below is a comprehensive summary capturing all the key discussions, insights, and conclusions from the episode.

1. Market Outlook and Economic Indicators

Jim Cramer’s Market Forecast: Cramer began the show by analyzing the implications of a strong employment report released that morning. He highlighted three main effects:

Recession Off the Table: With the unemployment rate at 4.2%, he stated, “It's very difficult to have a recession with a 4.2% unemployment rate” ([01:20]).
Federal Reserve’s Stance on Rates: The robust employment data discourages the Fed from cutting interest rates, especially with their upcoming meeting ([01:35]).
Potential for Market Rally: Provided wage growth remains controlled, Cramer anticipated an “explosive rally,” projecting the Dow to rise by 1.47% and the Nasdaq by 1.51% ([02:00]).

Impact of Chinese Trade Negotiations: Cramer expressed optimism following reports that China was considering a peace offering to combat Fentanyl production, which he believed could sustain the market rally ([03:15]).

Focus on Key Earnings: He spotlighted several companies with upcoming earnings reports, emphasizing Amazon as a buy despite some concerns:

Amazon: Expected to perform well with strong numbers from Microsoft and Meta ([04:10]).
Apple: Caution was advised due to potential issues from tariffs, as Apple faces challenges with shifting manufacturing from China to India ([08:55]).

2. Key Earnings Reports and Company Analyses

Beckman Coulter (Beckton Dickinson): Cramer provided an in-depth analysis of Beckton Dickinson’s recent performance:

Earnings Miss and Guidance Cuts: The company reported a revenue miss and cut its full-year earnings guidance by a percentage point, leading to a significant stock decline ([09:21]).
Stock Valuation: Despite the negative news, Cramer viewed the stock as undervalued at 12 times earnings estimates, considering it a potential buying opportunity ([08:00]).
Activist Influence: Highlighted the role of Starboard Value in pushing for a life sciences division spin-off, which Cramer believed would unlock substantial value ([09:50]).

Shake Shack: Cramer discussed Shake Shack’s underwhelming quarterly results but noted several positive aspects:

Revenue Miss but Improving Margins: Despite missing sales targets, the company achieved higher profit margins due to reduced food and labor costs ([29:00]).
Management’s Strategic Moves: Introduction of new menu items, such as the Dubai Chocolate Pistachio shake, and plans to reduce costs for new locations were seen as positive steps ([30:30]).

Exelon Corporation: In a segment with Exelon’s CEO Calvin Butler, Cramer praised the utility company’s robust performance:

Stock Rally: Exelon’s stock had surged 24% in the year, attributed to strong regulatory performance and strategic economic development initiatives ([30:00]).
Data Center Growth: Emphasized Exelon’s role in powering data centers, particularly in Chicago, leveraging nuclear energy for reliability and resilience ([33:42]).

Apple and Amazon:

Apple: Cramer expressed concerns over Apple’s exposure to tariffs and ongoing lawsuits, predicting potential long-term challenges due to strained US-China relations ([42:13]).
Amazon: While acknowledging a slight revenue growth slowdown in AWS, Cramer remained bullish on Amazon, suggesting continued investor confidence despite temporary setbacks ([47:00]).

3. Special Segment: 20th Anniversary Celebration

Celebrating Two Decades: The episode marked the 20th anniversary of “Mad Money,” featuring heartfelt congratulations from callers and special remarks from Cramer:

Caller Testimonials: Long-time listeners expressed gratitude, with messages like, “What you've accomplished over a 20-year period is quite extraordinary” ([37:50]).
Cramer’s Appreciation: Reflecting on the milestone, Cramer thanked his audience, family, and staff, affirming the show's commitment to educating and entertaining viewers ([43:00]).

4. Viewer Interactions and Q&A

Investment Club Discussions: Cramer engaged with callers seeking advice on various stocks:

Phillips 66: Cramer recommended buying the stock, highlighting its 4.4% yield and undervaluation due to market misconceptions ([10:02]).
Software Stock Woes: A caller expressed distress over poor performance in a previously touted software stock. Cramer advised holding onto Oracle, seeing potential for recovery ([10:25]).
Marvell Technology: For a semiconductor stock, Cramer endorsed buying Marvell, indicating optimism for its AI-related growth ([40:19]).
Applied Materials vs. Lam Research: When asked about Applied Materials, Cramer favored Lam Research as a more compelling investment ([42:22]).

5. Lightning Round Highlights

In the high-energy Lightning Round, Cramer delivered rapid-fire buy, sell, or hold recommendations:

Palantir: Suggested a “buy” due to strong retail support despite potential overhype ([08:00]).
Vertex Pharma & Clorox: Recommended Vertex Pharma for its innovative non-opioid painkiller and Clorox as a recession-proof stock ([08:00]).
ServiceNow & Disney: Advised buying ServiceNow for its robust quarter and holding off on Disney due to mixed performance ([08:00]).
Additional Picks: Included buying Arista Networks, Exelon, and Shake Shack, while expressing caution on firms like Carvana and Shopify ([08:00]).

Notable Interactions: Cramer interacted playfully with callers during the Lightning Round, maintaining the show’s engaging and dynamic atmosphere ([36:34]).

6. Closing Thoughts and Final Recommendations

Apple vs. Amazon Strategy: In his concluding remarks, Cramer emphasized a dual approach:

Long-Term Holdings: Despite short-term challenges, Cramer advised maintaining positions in both Apple and Amazon within the Chapel Trust for their long-term potential ([43:09]).
Amazon’s Resilience: Highlighted Amazon’s diversified business model as a strength, suggesting it might rebound faster than Apple.
Apple’s Geopolitical Risks: Warned of prolonged difficulties for Apple due to ongoing trade tensions with China, despite its strong brand loyalty and diversified revenue streams ([43:21]).

Overall Market Sentiment: Cramer remained optimistic, citing the momentum driven by strong employment data and strategic corporate actions, while cautioning against potential geopolitical disruptions ([43:27]).

Notable Quotes with Timestamps

On Recession Concerns: “It's very difficult to have a recession with a 4.2% unemployment rate” ([01:20]).
On Market Rally Potential: “It can cause an explosive rally as long as wage growth isn't too hot” ([02:00]).
On Phillips 66 Investment: “It's got a 4.4% yield. We're running short of refiners. I think that the stock has been overly punished” ([10:02]).
Anniversary Remarks: “It’s been an incredible 20 years of Mad Money. And I’m so grateful to all the guests who joined us and the staff members who helped us along the way” ([43:14]).
On Shake Shack’s Strategy: “It sounds like a lot of the trade-offs for new products is showing there’s plenty of demand as long as it’s good” ([40:00]).
On Apple’s Challenges: “Apple, I fear, will be stuck in the penalty box for playing by the rules that our governments endorsed” ([43:30]).

Conclusion

Jim Cramer’s May 2, 2025, episode of “Mad Money” provided a thorough analysis of current market conditions, highlighted significant earnings reports, and engaged with listeners through an interactive Lightning Round. Celebrating two decades of financial guidance, Cramer reaffirmed his commitment to helping investors navigate Wall Street’s complexities, emphasizing both caution and opportunity in the evolving economic landscape.

For those who didn’t tune in, the episode offers valuable insights into major companies’ performances, strategic investment recommendations, and a glimpse into the resilient nature of certain market sectors amidst global uncertainties.

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Transcript

Bank of America (0:01)

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Jim Cramer (0:30)

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Jim Cramer (0:38)

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Jim Cramer (1:09)

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 to entertain, but to educate, to do some teaching. Call me 1-800-743- CNBC. Tweet me at Jim Cramer. When you get a strong employment report like we did this morning, it does a lot of things that you need to know about. First, it takes a near term recession. Kind of off the table. Very difficult to have recession with 4.2% unemployment rate. That's just too much to be there for workers. Second, it tends to discourage the Fed from cutting rates, which matters because they meet next week. Third, it can cause an explosive rally as long as wage growth isn't too hot. And that's why the Dowd 564 points say S to be shot up 1.47%. Nasdaq poll voted 1.51% House of Pleasure. We get so many different numbers out from the government, but none are more important than the labor report. That is the real predictive power when it comes to the stock market. So keep in mind that today's rally may not be one off as we go through our game plan for next week. But first, let me just say we're over the hump. We've now had companies that reported fabulous numbers like Microsoft and Meta, good numbers like Amazon that I think will get terrific as the year goes on. Which is why I say you buy Amazon. But also some strong numbers that could become problematic unless the tariffs get brought down soon. And that's what we heard from Apple. Now, we're not waiting until Monday to start the plan here. The market was up in the morning, but then accelerated higher when we heard that the Chinese were debating a peace offering involving a crackdown on Fentanyl. If that comes true, I expect this rally will have legs. Plus, tomorrow, beginning at 8:30am on CNBC, we have full coverage of something I know you want to watch, the always upbeat Berkshire Hathaway annual meeting. Becky Quick and Mike Cintoli will bring you wall to wall coverage of Warren Buffett and his beloved supporters and shareholders. I don't know if you caught any of the stuff that they were doing today, but both Michael and Becky are really on their game on this one. It's going to be exciting. Oh, by the way, don't change the channel when it's over. Why? Because we're re airing our Mad Money 20 doc after the Berkshire Hathaway covers 230 Eastern. Now Monday's key earnings start after the bell. We're going to see what Ford Motor reports in the morning. Now I have to tell you, I'm a little concerned here. Ford has worked hard to try to mitigate the tariffs even as they're the most most American of American automakers when it comes to customers content. Maybe they can break their streak of so so quarters. I really hope so. I think Jim Farley deserves a break himself. The ultimate meme stock for the moment is this company called Palantir, which reports is a cybersecurity company. Now this one is moved up by persistent retail buying and starts around 4am every day when they literally walk it up a couple of points before the bell and then continue to keep it at that level until the close. It's possible the story is not as big as the hype or the hope, but we know that Palantir has got a constituency of retail buyers that just won't quit. I don't know if they'll quit when they see the number. We also get numbers from Vertex Pharma, including the first look at how its non opioid painkiller is doing. That's the one that's not addictive. The numbers could be explosive here because the drug is revolutionary. Now Clorox reports too. This is the kind of recession proof stock that was going up when the rest of the market was getting hammered. But now the market's bouncing back. They've all folded with the exception of Coca Cola and Mondelez. Use Clark's as a gauge to see if this new bull market phase remains on Tuesday. All right. We find out if the travel bull market's still alive when we hear from Marriott. Now this incredibly resilient stock typically goes down after reports and then it rockets higher. Same session. I think we'll think Twice about the end of the travel rally when Marriott reignites the chatter. It's going to be a good number at the close. When I hear great things about demand from Advanced micro devices, AMD perhaps. We get the news that AMD selling that manufacturing part of the ZT systems. That's a company they acquired for 4.9 billion in cash and stock in March. Now that could give this stock a lot of juice. Arista Networks is a crucial part of the data center. It reports last time the data surfaced immediately claiming that these guys were losing share. I think Arista can put those doubts to rest when it's, you know, honestly, they can. And that means it's a buy ahead of the quarter. Never count out CEO J Sri, you all. Big mistake. Think about buying Arista. We went to see Wind Resorts when we're out in Vegas recently. I know the stock's been under some pressure. I'd love to hear that. The negativity is all hot air. Don't forget that Jensen Huang, the CEO of Nvidia, will be joining ServiceNow CEO Bill McDermott at the latter's knowledge conference. Jensen is a good partner at Bill's and we might get news about how the government Nvidia are working together solve some of these export issues. The meeting could certainly help. The stock of Service now, which has been a rocket ship since, is reporting a fantastic quarter. Lots of fireworks on Wednesday. We start with Disney. So many doubters. I think too many doubters and not enough supporters. We own this contrary and play for the Chapel trust. We have not made money in it. It has not been good to us. I hope it gets good. Hope should be part of the equation, but I'm just telling it as I see it. Next. Did Novo Nordisk deliver a knockout punch to Eli Lilly when it signed a deal to be the preferred GOP Dash 1 supplier to CVS on Lilly's earnings day, no less. What a comeuppance. I think there's plenty of gas in the Lilly tag, especially when once it tells it's, you know, once it's got this pill formulation that's going to be available next year, I think it's going to matter tremendously. We've come to expect that Uber trades down after reports and you've got to buy the Ride share King because it's got so much going for it worldwide. I bet that plays out again. Just like Marriott stock reports. Stock gets kit. Got to buy it. In the afternoon we're going to hear from Fed chief Jay Powell and get the verdict from the Open Market Committee about what they're doing with interest rates. Now the tariffs are here. Tough spot for Jay Powell because we've had plenty of soft numbers. But today's all powerful employment report wasn't one of them. Will Powell mention that the President's been frosty of late? No, but the press will. The man will demure. He's too smart to do anything else. After the close, we got a couple of companies that have caught the fancy of younger viewers. DoorDash and Dutch Bros. I expect both to have very strong quarters that can send their stocks higher. We'll have the inevitable comparisons between Dutch Bros And Starbucks. Oh, all I can say is that the Bros have the edge right now, but I like them both. I don't know. Do you see Starbucks starting to move up here? What else can arm holdings matter come back without strong cell phone sales? I think the year when we realized this is it, this is the year we realize that arms and everything, it deserves a higher price earnings multiple. We also get results from one of the most heavily shorted stocks in the universe, Carvana. And I think they'll be able to talk about how tariffs will drive shoppers to their digital used car platform as new terrified cars. I made that word like terrified. It's really tariffed. Could become too expensive. It could be explosive. Report for Carvana. Thursday. We get Shopify's numbers. Here's another stock that tends to sell off on good news and then rallies when people parse it out and realize that, wow, this company is more than just a poor man's Amazon. At the close, we get a report from still anotherly heavily shorted stock. That's a firm that's a buy now, pay later story that has delivered some incredible results to date. I suspect the streak will continue. Two winners after the close. McKesson, the ultimate drug middleman. But the target on its back that's never, never been hit. And cloud flare. Yes, the cybersecurity firm brought to you by Matthew Prince who gave you a superb number last time, remember? I bet he can do it again. Well, DraftKings make a comeback here. We like this company very much, but the stock does seem stalled, doesn't it? Maybe it needs more states to legalize sports betting. Nothing important Friday, but after still one more week of grueling earnings, let me just tell you, I think we deserve a day off. Here's the bottom line. We know that we're living through a time of great tumble. We could easily be thrown off if President Trump responds harshly to this Chinese olive branch. This very weekend. If that happens, there could be some unwinding to do. Right now though, it looks like the momentum can keep up as long as we don't get a total breakdown in the nation trade talks between the world's two biggest nations. Let's start with Peter and Maryland.

Jim Cramer (14:24)

Yesterday morning we got a very disappointing quarter from Beth Dickinson. The medical technology plant sent its stock down 18% to its lowest level in eight years. Everybody's given up on this one, but I think actually you might be getting a real buying opportunity in a company that has the potential to turn itself around. Listen to me. For decades back Nixon was it was a fantastic growth stock. I mean it was just incredible. The name I love to recommend here. Why so reliable? Over the past five years though, the stock had leveled off, mostly trading sideways with the occasional strong rally, but just as many sharp pullbacks. We actually spoke to CEO Tom Poland about 15 months ago. He told a pretty darn good story. In fact, Becky Dickinson delivered a series of strong beat and raised quarters last year. Stock never got any traction. The stock finally started rally this January and February, especially after we learned that the smart activist investors at Starboard Value had taken a business at a big position. And by the way, they were urging back in Dixon to sell its life sciences division. Two days later Becky Dixon basically said okay, let's do it, announcing the spin off of its life science division to unlock some value. I think it's a really smart move because the core medical technology business will be worth a lot more once it separates from the slow and steady segment. Unfortunately, alongside that announcement, management also issued what I guess called mixed guidance. Though the reported quarter had gone pretty well, they cut their full year revenue forecast pretty substantially and the stock tumbled 7% in response. After that beckons and held up okay throughout the rest of February and March even as the broader market started breaking down. But when Liberation Day tariffs were announced, the stock tumbled 8% over the next two days. Even though the rest of the markets bounced back substantially since then. Beckon Dickinson. It never recovered. That leads me to yesterday's earnings report. Even though I think the stock's now worth buying on weakness, let me be crystal clear, that quarter was distinctly sub optimal. That gave you a meaningful revenue miss paired with a slight earnings beat. But more important, they cut their full year forecast first. Management cut their organic revenue growth outlook by a percentage point from the previous 4 to 4.5% range down to the 3 to 3.5% range. Analysts were looking for 3.6. Then Beck Dickinson said the tariffs will shave 25 cents off their full year earnings, which is not huge but also not good. More important, the market simply hated this update. No less than six analysts have downgraded the stock over the past two days Sell. Sell. Sell. Sell, Sell. Three intraday yesterday and three more over overnight. It was just so hideous. All six took the stock from the equivalent of a buy rating to the equivalent of a hold or neutral. With the downgrading analysts all basically sounding exasperated about yet another negative revision from management. It was visceral. I think it was like visceral negativity. It's not. The particular forecast cut was so terrible. When you read through the numerous downgrades, there's a consistent message. While Becky Dickinson has disappointed investors for several years now, this year was supposed to be different. Coming into 2025, management said they'd be, they'd be guiding conservatively, essentially keeping the numbers low to ensure they could beat their own forecast. They went under promise. But now here we are getting yet another downward revision and the sellers just said enough, get this stock off my sheet. People just ran out of patience and they ran out of Beckton Dickens. I'll sell. I'm not going to tell you that these analysts were wrong. No, not at all. Or that investors were wrong to sell the stock. I get their frustration, but I simply think that the total give up moment by Wall street might represent a darkest before dawn moment for Beckton Dickinson. Anyone who has had high hopes for the company is out thrown in the towel, sold the stock and that makes it much safer to own. Sure, it is disappointing that Beckon Dickinson hit us with yet another guide down after already saying they'd given us a low ball forecast. But there were some pretty significant extenuating circumstances when Beckton Dickinson committed to guiding conservatively. How could they have known that to be a total upheaval of world trade? The company said specifically that, quote, before the impact of tariffs, the company expects adjusted diluted earnings per share to be consistent with the previously issued guidance, end quote. Noting that, quote, strong operational performance driven largely by margin improvement is enabling the company to fully offset the earnings impact from its updated organic revenue growth expectations, end quote. Basically, even though Beckmann gets in lowered its organic revenue growth outlook a touch, management still says they would have been able to make their earnings guidance if not for Trump's tariffs. And look, they think tariffs will cost only cost them only about 25 cents per share this year when they were previously looking to earn $14.30 to 1460 per share. All right, not a big hit. It's just it was the exasperation that they kept cutting their guidance that bothered so many of these analysts. Hey, by the way, for all the commentary about missed expectations, back in things is now beaten. Wall Street's earnings expectations for six consecutive quarters. Their sales and earnings have been growing steadily over the past two years and they're on track to grow nicely this year. So how disappointing is that? I don't know. More importantly, I like the stock at these levels because it's gotten incredibly inexpensive. Beckon Dickinson now sells it extraordinary 12 times this year's earnings estimates. That is absurdly cheap for a high quality company when you look at the average valuation over the past 10 years. Back to Kingston typically traded at a little less than 20 times earnings. For what it's worth, a stock also supports a decent dividend or 2.5%. Companies a regular repurchaser of its own shares. They already bought back seven $50 million worth of stock through the first six months of their 2025 fiscal year. Then there's the last thing. And this is the thing. I really like Starboard Values gotten involved and they're a very smart activist firm. I think they're very thoughtful. They pushed for a Life Science spin off and Beckman Davidson agreed to do it practically overnight. Management says that's still on schedule. That's really important. I like the breakup. And just as important, I like that. I like that a sharp firm like Starboard has gotten involved, not running. They think these guys can do it. They can keep management on their toes. Maybe Starboard will have to do more work than it previously thought it would look. Maybe there needs to be a discussion about whether the company has the right leadership in place, which Starboard wasn't talking about previously. But I think the their presence certainly makes. Let's just say it ensures that company gets back on track by any means necessary. That's how I felt. So here's the bottom line here with Beckton Dickinson. It got wrecked this week, collapsing after the company reported a mixed quarter and cut its full year earnings guidance. But I think this could be a buying opportunity, not a selling opportunity. As long as you're willing to embrace what I call a fireman trade where you run into a burning building rather than run out of it like everybody else. Back in things just too cheap to ignore here. The core business is fine. They can unlock a lot of value with this. Life Science has been off. To me, the stock looks like a buy, not a sell. Let's go to Ann Indiana and well.

Jim Cramer (23:46)

Perhaps you could have seen today's rally coming because earnings season has been signaling that we'd gotten to negative. Over and over we've seen stocks roar in underwhelming numbers. That's a classic sign of excess pessimism. Take Shake Shack which reported not so hot quarter yesterday still saw its stock rally 1% on the news before jumping over 6% in today's session. Now look, when a stock rallies in subpar numbers, you know what that means it means it's bottomed. Yesterday Shake Shack delivered a modest revenue miss with 0.2%. Same store sales growth. Wall street was looking for 2.3% gain 2 cent earnings miss over 16 cent basis. Worse, management trimmed the full year revenue and comp forecast. It's definitely nothing. Write home about now. When those numbers crossed the wire yesterday morning, the Stock instantly fell nearly 6%. $6 almost 7% and pre market trading it was incredible. Totally justifiable given the headline numbers. But in retrospect you are really smarting if you made those sales because the stock quickly caught a bid. By the time the market opened Shake Shack it was in positive territory. So what turned things around given the fact that it was pretty bad? Ms. Well, for starters, Shake Shack missed estimates for several key metrics. But there were some positives in there too. The company's restaurant level profit margins came in at 20.7%. That's up about 120 basis points year over year. Not shabby. 30 basis points higher than expected. They're benefiting from falling food and paper costs and plummeting labor costs as the companies now optimize their new hourly labor model which provides more efficient staffing options. And they've gotten more efficient with their throughput. Plus, while management lowered some aspects of their full year outlook, well, this was more mixed than negative. Shake Shack raised their full year restaurant Profit margin outlook from 22 to 22.5%. Even with softer sales, they see margins continuing to tick higher. Even better, management raised their three year restaurant level profit margin forecast pretty substantially. They're talking about 50 basis points of margin expansion each year and I love a three year, how great is that? But margins weren't the only bright spot quarter. There was a lot of encouraging commentary on the conference call while traffic remained negative last quarter. Management sounds confident this is temporary. A lot of it came down to bad weather in some of the biggest markets. We know that happened. Shake Shack started off the year strong in January, but February proved to be the most challenging month and again that was because the weather. There was some recovery in March, but April same store sales were still down 1%. However, management said that momentum picked up as April progressed. They were seeing positive low single digit same store sales growth in the last few weeks. So we had good cadence. The most important part of the call was management acknowledgment of maybe the biggest problem facing the industry, high prices for the consumer after years of elevated inflation. You know, this one reminded me of what we've been hearing from Kevin Hockman, the CEO of Brinker, that's a parent of Chili's, which turn itself around by emphasizing value offerings giving people great bargains. As previous price increases rolled off, Shake Shack exited the quarter with less than 2% menu pricing increases compared to last year. Although it's been years since the company implemented such a small price increase. Imagine believes keeping prices in check will give them an edge over the competition. The company also plans to ramp up its limited time offer innovation. Shake Shack placed some of the blame for the subpar traffic last quarter on the fact that their black truffle burger LTO limited time had been running for several months. Well, for seven months. The lack of new menu items meant less buzz to attract customers. I mean, can you really call something that's been around seven months a limited time off offer? It was last summer through the past Easter, by the way, Shake Shack's new limited time offer launched today featuring a full barbecue menu. I hope it's successful, but I also hope it's pulled sooner than that. And it's not just burger. Shake Shack saw strong success, but here's a wild one. Its recent Dubai Chocolate pistachio shake, which went viral on social media, sold out within minutes of its launch in mid April. Some locations very lucrative because their shakes come in at a premium price given the Dubai Chocolate shake was priced at $8.49. I mean the house of the highest price point for a shake they've ever offered. That tells me there's plenty of demand for the stuff as long as it's good person up for 999 combo deal. But it's clear that the customers respond to these new products. What else? Shake Sack CEO Rob Lynch, a restaurant industry veteran who served the stint as VP of marketing and Taco Bell that's what a launch point that has been put out. The Taco bell can make 4 and 50,000 different items different items out of just 14 ingredients with minimal impact on operations. You also helped engineer turnaround at Papa John's from 2019 until May of last year when he moved to Shake Shack. After speaking with him late last year, I'm confident he can make it work. Shake Shack too, with value offerings on one side, premium items on the other. This approach sounds like a lot like the barbell strategy the Chili's has had so much success with. Management noted that they're on track with their plans to reduce their cost to build new locations by at least 10% this year despite tariff and construction concerns. That's pretty cheap. Starbucks wasn't able to Talk about it being that cheap. They also raised their full year outlook for new unit opening slightly, bringing it up to 45 to 50 locations. With most of these new units coming online in areas of strength like the Southeast. The Southwest. While Shake Shack still has a long way to go to reach their goal of 1500 company owned locations, more than quadruple its current footprint. That means this regional and national growth story won't exhaust itself anytime soon. I really like that. Here's the bottom line. Shake Shack's quarter came up short on several key metrics, but the stock still managed to rally in part because it was already down so much, but also because the margins are improving and management got countless growth initiatives going. You know what? I think this is a very compelling story. Look, you may want to wait for a better entry point if for today being up 6%. But I gotta tell you, Shake Shack, it's here, it's bottom. I like it. Ben, money's back after the break.

Jim Cramer (43:52)

It's been an incredible 20 years of mad money. And I'm so grateful to all the guests who joined us and the staff members who helped us along the way. And of course my daughter and my wife. But we're not done. I still want to talk about two big quarters we saw yesterday from Amazon and Apple. They're just too important to ignore. I don't know a soul who has any other kind of phone. I don't know anyone who isn't a prime member. It's not easy to get that kind of brand loyalty. It's not easily lost. In both companies, no matter what their stocks are saying, are indeed loved. These are complex businesses, though. Apple has cell phones and wearables, but also as a service revenue stream, that matters tremendously because it's sticky and it grows as people get more comfortable with the whole family of products. Amazon is a retailer with an enormous web services business, as well as an advertising division that's got incredible gross margins. The complexity does not help the valuations though. Wall street loves simple stocks that are easy to get your head around. And these are anything but simple. Last night, Apple reported a very fine quarter. But because of tariffs on goods made in China, this budding consensus is that this was the last good quarter. So the stock crater falling $8 to 3.74%. Wow. The tariffs could really play havoc with the numbers. Apple's trying to move enough cell phone production from China to India to get a lower tariff rate, but we have no idea how long it will take to move a significant amount of their manufacturing. So there's a lot of guesswork. We also had a disappointment on the service revenue front. And it comes on top of two lawsuits that can hurt service revenues itself. The epic suit involving how to pay for downloaded games and the monopoly suit that calls into question Google's decision to pay Apple $20 billion for its right to be their default search engine. These legal issues are rough. Put it all together and you can understand why the stock got hit today. How about Amazon? The problem here is that the giant web services business seems to have skipped the revenue beat, with growth declining from 19 to 17% even as though the margins increased. Now, Amazon stock was able to shrug that off, finishing virtually unchanged because it could have been avoided if they had more computing power, meaning more chips from Nvidia. Not all that. Coincidentally, Nvidia had a very good week. Apple, no comeback, but it just couldn't make it. I think it could overcome the service revenue miss. It's not like the business has never disappointed before. I was think that any resolution to the lawsuit with Google could be years away and it isn't clear if the contract can be voided. No, the real problem with Apple said it's caught in the crossfire of this trade war with China Right now. I think there are two camps at the White House. The camp that says Apple. Apple doesn't deserve this. But CEO Tim Cook will be able to figure out what to do. After all, Apple's created 2.9 million jobs here, about about 1.5 million people helped to put together Apple hardware in China. Tim Cook is a champion of the United States and China. He's almost a mystical figure. He's managed to straddle these two countries better than anyone. The other White House camp, though, says that China and the United States simply can't be straddled and anyone who's trying to do that is not a good actor. This camp has a lot of sway with President Without a big trade deal with China that effectively rolls back nearly all the tariffs, Apple's earnings are indeed in trouble. Unfortunately, I believe a friendly deal with China I think is going to prove elusive. We are choosing to own both of these stocks for our Chapel Trust because I believe in them long term. But only one is likely to snap right back, and that is Amazon. Apple, I fear, will be stuck in the penalty box for playing by the rules that our governments endorsed ever since China joined the World Trade Organization 2001 1. But that was then with a very different president and this is now. Like I said, it's always been market somewhere at Promoter Finance Just for you on Mad Money, I'm Jim Cramer. See you next time.