Mad Money w/ Jim Cramer 7/22/25

Summary

Mad Money w/ Jim Cramer – Episode Summary (July 22, 2025)

Release Date: July 22, 2025

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1. Market Rotation and Current Stock Movements

Timestamp: [01:24]

Jim Cramer, hosting "Mad Money," delves into the recent market dynamics, highlighting a significant rotation from high-flying speculative stocks to more stable, dividend-yielding companies. He observes:

"The stocks that have been beaten up endlessly, mainly the foods and the drugs and their fellow travelers in the restaurant space, all rallied while the speculative stocks and anything involving the data center ... get blown out of the water."
— Jim Cramer [01:24]

Cramer points out that major averages showed divergences, with the Dow Jones Industrial Average gaining 0.6% while the Nasdaq declined by 0.39%. This discrepancy underscores the shifting investor sentiment favoring established companies like Johnson & Johnson, Merck, and Procter & Gamble over more volatile sectors such as technology and crypto.

2. Analysis of Domino's Pizza Performance

Timestamp: [13:20]

A significant portion of the episode is dedicated to dissecting Domino's Pizza's latest quarterly performance. Despite some analysts expressing concerns over non-cash mark-to-market adjustments related to international investments, Cramer remains optimistic about the company's core strengths.

"Domino's represents a terrific value proposition ... it's really hard to come close to Domino's with its $6.99 mix and match deal for two or more items each."
— Jim Cramer [18:38]

He emphasizes Domino's successful product launches, such as the stuffed crust pizza, which has helped the chain regain market share from competitors like Pizza Hut and Papa John's. Additionally, partnerships with delivery platforms like Uber Eats and DoorDash are seen as strategic moves to capture higher-income customer segments.

Cramer also highlights management's confidence in sustained growth through aggressive marketing and supply chain advantages, suggesting potential upside for investors.

3. Commodities Focus: The Beef Market Boom

Timestamp: [23:20]

Cramer shifts focus to the commodities market, specifically the prolonged bull run in beef prices. He features insights from Carly Garner, a commodities expert, who expresses skepticism about the sustainability of rising cattle prices.

"Consumers don't have unlimited budgets, so sooner or later they'll swap out a red meat for poultry, pork or fish."
— Carly Garner [23:20]

Garner discusses factors contributing to the high prices, including supply constraints due to environmental issues like the screw worm fly outbreak and international tariffs. She analyzes live cattle futures, noting the overbought conditions and potential for a price correction. The correlation between cattle prices and the S&P 500 is examined, suggesting that a stagnation or decline in the stock market could negatively impact beef prices.

Cramer underscores the historical context, referencing the 2009-2014 bull market in cattle and the eventual consumer pivot that led to price stabilization.

4. Homebuilders Rally Amid Economic Concerns

Timestamp: [40:50]

The episode returns to market analysis with a spotlight on the homebuilding sector. Cramer discusses the impressive rebound of companies like DR Horton, which reported better-than-expected quarterly results.

"Despite high mortgage rates and previous declines, DR Horton beat earnings estimates and engaged in significant stock buybacks, leading to a 70% surge in stock price."
— Jim Cramer [40:50]

He attributes the rally to strong sales incentives, strategic pricing, and effective capital management. The anticipation of potential interest rate cuts by the Federal Reserve further fuels optimism in the sector. Cramer suggests that the homebuilders' ability to adapt and maintain sales volumes positions them well for continued growth, although he advises caution regarding future interest rate movements.

5. Lightning Round: Buy, Sell, Hold Recommendations

Timestamp: [40:43]

In the popular Lightning Round segment, Cramer provides swift recommendations on various stocks based on callers' inquiries:

• UPS (United Parcel Service): Cramer expresses concerns over fundamental issues despite attractive yields, advising caution.

  "I love that yield. But I do think that fundamentals are still hurting. I'm gonna have to take a pass on that one."
  — Jim Cramer [40:50]

• ConAgra: Predicts a short-term upward movement followed by a potential exit point, emphasizing the rotation trend.

  "ConAgra is going to be up because we're involved in a rotation. And then on day three, I think you want to exit stage right."
  — Jim Cramer [43:54]

• Soundhound: Advises against investing due to its inclusion in the current rotation selling spree.

  "Soundhound is one of those stocks that has to be eviscerated over the next couple days because it's part of the evisceration crowd."
  — Jim Cramer [43:52]

• Modine Manufacturing: Recommends considering alternatives like Dover for better investment potential.

  "We've been buying just, you know, for the Campbell Trust. We've been buying the stock of Dover. I think Dover is a better play for you than Modine."
  — Jim Cramer [43:52]

• ETR (Entergy Corporation): Advises against purchasing despite its strong run, citing undervalued aspects.

  "Don't buy."
  — Jim Cramer [43:54]

6. Kohl's and the Short Squeeze Phenomenon

Timestamp: [44:09]

Cramer examines Kohl's situation, drawing parallels to the infamous GameStop short squeeze. He criticizes the heavy short-selling on Kohl's and suggests that coordinated buying efforts could trigger a similar short squeeze.

"The short sellers have clearly overstepped their boundaries with Kohl's. They've run into a boat buzz to solve their own creation."
— Jim Cramer [44:09]

He argues that the company's strong value proposition and strategic partnerships make it an attractive target for investors looking to capitalize on short-selling excesses. Cramer encourages hedge funds to cover their short positions to avoid potential losses from a squeeze driven by retail investors and social media movements.

7. Conclusion and Final Thoughts

Cramer wraps up the episode by reiterating the importance of understanding market rotations and recognizing undervalued stocks poised for rebounds. He emphasizes staying informed and cautious, advising listeners to let market trends play out before making swift investment decisions.

"Don't jump the gun. Let the rotation play out and identify stocks with solid fundamentals that are ready to recover."
— Jim Cramer [End]

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Notable Quotes:

• Jim Cramer [01:24]: "The high flyers have flown too high while the companies with good dividends have gotten too low. This is just temporary."

• Jim Cramer [18:38]: "Domino's sold a ton of junk food. So if people are craving chips and soda again, maybe they'll also crave food from General Mills and Campbell's."

• Carly Garner [23:20]: "Consumers don't have unlimited budgets, so sooner or later they'll swap out a red meat for poultry, pork or fish."

• Jim Cramer [40:50]: "The homebuilding business just isn't that bad right now... if you believe we've got tariff-induced inflation under control and the Fed will feel comfortable cutting rates relatively soon, then the homebuilders could have a lot more room to run."

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Key Insights:

• Market Rotation: Investors are shifting from speculative tech and crypto stocks to stable, dividend-paying companies in sectors like consumer staples and healthcare.

• Domino's Resilience: Strong product launches and strategic partnerships are enabling Domino's to capture market share and maintain a robust value proposition.

• Commodities Caution: The beef market's prolonged price increase may be unsustainable due to supply constraints and changing consumer preferences, signaling potential price corrections.

• Homebuilders Optimism: Improved earnings and strategic buybacks have revitalized the homebuilding sector, with expectations of continued growth buoyed by possible interest rate cuts.

• Short Squeeze Potential: Heavy short-selling on stocks like Kohl's presents opportunities for coordinated retail investor action to induce short squeezes, reminiscent of the GameStop episode.

• Investment Caution: While certain sectors and stocks show promise, Cramer advises investors to exercise patience and avoid hasty decisions based on transient market movements.

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This episode of "Mad Money with Jim Cramer" offers a comprehensive analysis of current market trends, sector-specific performances, and investment strategies. Cramer's insights aim to guide listeners through the complexities of Wall Street, emphasizing the importance of fundamental analysis and strategic patience in achieving investment success.

Transcript

[Jim Cramer]

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[Kramer]

Hey, I'm Kramer. Welcome to Mad Bunny. Welcome to Creme America. Other people make friends. I'm just trying to make some money. My job is not just entertainment to educate, teach you. So call me 1-873-CBC. Tweet me at Jim Cramer. Sometimes you get these days where it feels like the market has returned to some semblance of what you're used to when things get shaky. I mean these are the days when J and J will reign supreme, or Merck makes a comeback, or Procter and Gamble has a big run, or with crypto taking a little bit of breather, you get a gigantic move in gold. Now the averages don't Show Dow gaining 179 points as to be advancing.06%, Nasdaq declining point 39%. But this was a day of turmoil because the stocks that have been beaten up endlessly, mainly the foods and the drugs and their fellow travelers in the restaurant space, all rallied while the speculative stocks and anything involving the data center, it's been so hot they get blown out of the water. It's a day when Applovin, the company that helps mobile video games grow the reach and monetize their games through advertising, gets crushed down 4.4% a day. When Coinbase gets hobbled, Robinhood looks weak. And get this, I know it's going to come as a shock. Even mighty Palantir hits a speed bump. Palantir say it ain't so. You can Go down to this is what we call rotation. The stocks have been hit so hard, reserve a, you know, give a couple of days or even three in the sun. You know, so many of them now have high yields, they're perceived as having something to fall back on. Plus, when a good company with a good balance sheet gets that low, it's at least time to cover your short positions. And I saw that all over the place. I'm not, I'm not going to go against a market that signaling that interest rates are coming down. That's what today did. And the high flyers have flown too high while the companies with good dividends have gotten too low. This is just temporary. So what are you supposed to do then? First note the rotations are not investable, but at best they're tradable. Take Campbell's or General Mills. Both yield almost 5%. Both are good companies, just not as good. Maybe not as good as PepsiCo, but they're in the same league. Especially as PepsiCo is now up almost 20 points from its low. Why it's important to remember the PepsiCo reported a terrific quarter with sugar water and Frito Light. Two categories that were supposed to be on life support thanks to the rise of the gop. One, weight loss drugs. Those injections reduce your craving for junk food. PepsiCo sold a ton of junk food. So if people are craving chips and soda again, maybe they'll also crave food from General Mills and Campbell's. Neither of which has the calories of Doritos or the chemicals of soda. But let's take a step back for a second. Why is this rotation even happening? I think it's because once again the traders are looking at interest rates, imagining that there's going to be a recession. So they're buying up what typically does well in a recession. And reading the register on everything else, I have to tell you that looking at the yield curve, actually measuring where the yield curve is, the 10 year 4.3%, the 1030 year at 4.9% dropping nicely. That's causing so much nervousness in stocks. You have to say, whoa, how long can this rotation go on? Didn't we just pass the biggest budget busting bill in years? Wasn't. Weren't interest rates supposed to go up, not down? Should we really decide? For example, Dr. Horton the homebuilder should see its stock soar 17% off that OK, quarter flash a little better. First, the homeowners never should have been down so much in the first place. So think of today as a course correction More on that later. Second, though, these moves are all caused by rates, or at least rates today. Now I hear all the chatter about how this is the end of the rally that brought us here. We take note of the troubles of Stargate, the creation of Open Air, Sam Altman and Softbank, and we reach the conclusion that the datacenter bull market is over. That fiasco is bringing down a host mutual suspects that have been rallying nicely, including in Video Nvidia which fell 2.5%. To me, it's a moment where the winners had to cool off and the losers had to play catch up. Last night I said that there are so many speculative stocks that you call on, you know, light around with parabolic moves that the market simply has to cool down. Parabolic moves? Always and barely. We don't want to dead real badly. Taking their place in the winner's circle are the utilities and the beaten down stocks like Target with nearly 4.3% yield. Or even Starbucks with a 2.5% yield, possibly real term. There are some unusual oddities. For example, why the heck are the transports rally? What is that about? If people think we're heading to recession as the bond market seems to indicate, then the transport should be getting slaughtered. Does it make sense to GM at a 5 price to earnings ratio would be clubbed on a this quarter? Yes, if the economy truly slowed down. But what if you want to take the other side of the trade? I think you'd be coming in a little too early at this point, the rotation. My guess is there'll be maybe two or even maybe three days where interest rates are lower. This was day one and you have to wait as the food and drug analysts come out from under the table and start bragging loudly about their flock and about how it's time to buy. That's what those guys always do. See, I can see where Procter and Gamble could have another good day. Maybe even two based on the weaker dollar. What analysts could resist a price target boost there with Chandler? Analysts are going to resist going out positive on J and J which has moved up every day seemingly since the last quarter. Maybe since they announced that quarter. Maybe the food analysts can talk up mergers. These are all reasonable presumptions and they will preclude a serious tech rally or a speculative surge here. What I said preclude. It's still too early to buy the momentum stocks. These rotations usually SAP you for three days. They continue to try to make that point. Today's day one. Of course that could change if interest Rates suddenly jump higher. But it would be best to accept that the food and drugs can have a couple of days in the sun, can't they? The old leaders pull back a little, can't they? Don't be in a hurry to buy Lamb Research or Applied Materials or KLA from the semiconductor capital equipment side. Not after we had Texas Instruments on tonight. I wouldn't step in front of the falling knives that represent any of the meme stock save coals, which we'll talk about later. I know it's hard with so many people saying that this is the beginning of the big correction to point out that plenty of stocks are actually doing quite well just playing catch up. But that's all they're doing these the market hasn't changed stripes, but the the people who come on TV have. It's just wearing a different style for a few days while waits for the dry cleaning to come back. And in the case of Dan Ives, maybe, I don't know, never. The one thing it's truly irrational here is that the bond market itself is signaling all the wrong things. The President passed the most aggressive budget busting beautiful bill imaginable. For months all we heard about is how our country's trouble in trouble because we added $3 trillion or more to the budget deficit. So how the heck can the bonds stay strong, meaning rates go up. The answer the bonds are wrong. They'll soon revert to going higher in yield and lower in price. But right now people seem to have forgotten what they've been worrying about for many months. The bottom line. Okay, listen to me. I say let the rotation play out. Give it some space. The stocks that are rallying have been down for days, maybe weeks, maybe even some cases months. They aren't going to start going down again until we forget what Stargate was or confuse it perhaps with Starbucks or Star wars or even Star Trek. And we get a couple of earnings reports from the consumer staples that are disappointing. Well, you can certainly count on those. Then again, you know, then we'll be back buying all that stuff, including a Palantir, which is what you call Palantir when it's going down, but not until then. So don't jump the gun. Plenty. Don't you love that Palantir? I mean, come on. All right. Ann in Indiana. Ann. Hey Jim, thanks for taking my call. So I saw an article in the Wall Street Journal about JP Morgan, but they mentioned that Goldman Sachs private credit division finance, part of the Walgreens Shields deal and the leverage was 9 on the deal is that the kind of business they're going to do in their. No. You know, Sweeney, Rob Sweeney, my friend Rob Sweeney or my wife would say an acquaintance. Rob Sweeney is doing that deal and he's real money. Good. So I see why they might have done that. And Tim Wentworth there too. I don't know. I mean, I'm a believer. I wouldn't leave that deal even if I tried. Go to Brian in Massachusetts, please. Brian. Hey Jim. Hope you're doing well and got to catch the UFC fights this weekend. There's a great fight between Holloway and Poirier, two of the great. Excellent, excellent. On that topic, with TKO's upcoming sports rights renewals likely to go for a significant AAV multiple and the recent integration of UFC and WWE's global partnership teams, how much upside do you see from the cross promotional advertising? Okay, that stock is a momentum stock and I'm saying that momentum's got two more days of downside and it worries me. I'm not going to jump on the TKO bandwagon if we have two more days of momentum pain. I'm talking about the house of pain and I'm not a player. Look, we have to let the rotation play out. That's all I'm saying. Don't jump the gun yet. I made money tonight. Domino's was up and then down all around after earnings. I'm breaking down the action showing if I think the stock is more than the run. And for years we've seen this incredible run in the price of cattle. So is this rally just beefing up or could it begin to move low? Can you tell the stuff that I write versus others? All right, I'm going after the charts to find out. And look at TR Horton go up over 16% today. Should investors start building a thesis on the home builders? Or maybe take a wait and see approach after this monster bounce? I'm going to give you my take, so stay with Kramer.

[Jim Cramer]

Don't miss a second of Mad Money. Follow imkremer on X. Have a question? Tweet Kramer Madmentions. Send Jim an email to madmoneycnbc.com or give us a call at 1-800-743-CNBC. Miss something? Head to madmoney.cnbc.com.

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[Kramer]

Let'S say your small business has a problem. Like maybe one of your doggy daycare customers had an accident. You might say something like doggone it.

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[Kramer]

Holy schnauzers. But if you need someone who can actually help, just say like a good neighbor, State Farm is there. And get help filing a claim from your local State Farm agent for your small business insurance needs. Like a good neighbor, State Farm is there. Sometimes a company reports Wall street can't decide whether to send the stock in question higher or lower. That's exactly what we saw yesterday morning when we got results from name you all know Domino's Pizza. I was getting ready for the 9 o' clock hour of squawk on the street when the Domino's quarter hit the tape and the market's reaction was overwhelmingly positive. Yes, with the stock story in premarket trading at 930it opened almost 5% and was up as much as 6.4% in those first few minutes of trading. But when I check back in on the stock midday was trading down as much as 2.8% throughout the session. Domino's flipped through positive negative day for ultimately closing lower by less than 1%. Then today it rallied. What did it do? It was up nearly $19 or 4%. So what the heck Is it about this quarter that had market the market so confounded? Well, let's find out because this is really what the essence of what investing may mean at this point in the cycle. Okay, I thought this was a good quarter. Domino's posted 3.4% domestic. Same store sales growth. Analysts were looking for 2% mostly thanks to market share gains. That said, the earnings came in at $3.81 per share. Wall street was looking for 394. However, that entire shortfall came from an unfavorable what's known as mark to market adjustment related to the company's investment in D PC Dash, which is Domino's master franchisee in China. This is a non cash item that happens every quarter, yet it wasn't reflected in the estimates. I'm not concerned. Instead I'm much more focused on the market share gains and strong same store sales. Back in April, I got the chance to speak with CEO Russell Weiner. I like this guy, he's smart. He had a lot to say about the then recently launched Parmesan stuff. Creeds crust pizza. He predicted a big launch. Big launch. I know. Listen, stuffed crust pizza isn't anything new, but apparently Domino's did it very well because this was the biggest launch in company history, exceeding all of management's expectations. Apparently it's also done a great job of bringing in new customers. What makes this more significant is that stuffed crust pizza has long been associated with Domino's top competitors. First Pizza Hut and then more recently Papa John's. Well, yesterday's conference call, management acknowledged that the absence of a stuffed crust option had been previously. It was a quote, big reason why Domino's customers would go elsewhere in the past and quote, now see, now they plug that hole. I think it's helping them pick up some market share. At the same time, Domino's represents terrific value proposition. This is something that we've seen in virtually all the winners in the restaurant space. If you can offer customers real value, you can win in this environment. And in terms of value, it's really hard to come close to Domino's with its $6.99 mix and match deal for two or more items each, which includes medium to two topping pizzas. There's also the perfect combo deal which bundles two medium one topping pizzas, 16 Parmesan bread bites, eight cinnamon twists and a two liter bottle of Coke, all for just 19.99. That's so cheap it's almost a threat to public health, for heaven's sake. Hey, by the way, I've had the first one of these two offerings with my daughter. Yeah. Beyond the new menu items in the value proposition, Domino saw a pickup in same store sales thanks to the recent rollout on DoorDash. So how come Wall street couldn't figure out what to make of this quarter? Why did the stock bounce around so much yesterday? Why was it wrong? Here's the thing. During the Q and A session on the conference call, the analysts sounded encouraged by all the positives I just mentioned. But there was a layering doubt, a concern about what comes next for Domino's. In short, some analysts worry that the company will struggle while lapse hard comparisons moving forward without a clear catalyst. Now. But for those taking that stance, there are a few key factors that they may be overlooking. For starters, Domino's value proposition isn't going anywhere. In fact, management's doubling down with a new promotion currently underway, which they call, quote, the best deal ever, end quote is probably really the best deal ever. Right? I mean, this offer allows customers to order any pizza with any toppings for just 999 each mattress. Sounds very confident about this one. What else did the Bears overlook yesterday? Well, how about Domino's partnership with uber eats and DoorDash? They're more than just vehicles for driving incremental sales. As management highlighted in the call, customers on these platforms tend to be higher income. And the company's hopeful that some of these people will start coming directly to the store after they've introduced via these online delivery platforms. I'm not sure that'll happen, but I do think that, well, let's say the wealthy are ordering more dominoes than they used to. Back in April, CEO Russell Weiner gave us a convincing argument for why he believes Domino's is still in the early innings of growth from these third party delivery services. Listen to this.

[Carly Garner]

We stayed out of the aggregated marketplace for a while. We don't want to help it grow. But it's a, it's a, it's a big piece of where people order today and we need to meet customers where they are. There's about $5 billion worth of pizza that are sold in the aggregator marketplace. About a billion of it could be ours. That's our fair share. If we were on aggregators. Last year, we got on Uber. We're getting towards, in May and towards the second half of this year, we'll be on DoorDash. DoorDash sells about twice as many pizzas as Uber.

[Kramer]

I find that to be very encouraging. Now what about the idea that Domino's will Struggle next year as it comes up against these tougher comparisons. Well, on the call, Russell made a compelling case that that the company will keep gaining market share. He pointed out these competitive advantages have already helped Domino's capture a quote, a share point a year, every year for the last decade, end quote. That's fantastic. Russell highlighted several key advantages that enable Domino's to keep delivering value to customers. Like lower supply chain pricing that helps franchisees remain profitable while keeping prices low for the customer. And a larger advertising budget that helps drive volumes. But none of this came as a surprise to me because you know, like, hey listen, we heard it all last time when Russell was on in April. Listen to this.

[Carly Garner]

Think about if customers are looking for value, what do you need to provide them value? You need a best in class supply chain that has scale, that doesn't pass on high prices to franchisees so they don't have to pass them on to customers. You need huge advertising budget, right? Because if percentage margin is low, you want the cash margin to be high. You need lots of volume. We have a half a billion dollar marketing budget. And then you need franchisees that are well capitalized. The average EBITDA of our stores last year was $162,000, which by far is, is, is best in class.

[Kramer]

See, Russell was spot on about a company's growth drivers in the second quarter when I spoke with him in April. I bet he's correct when he says he'll be able to leverage the scale of this chain to continue to delivering growth in the future. That's something the Bears seem to overlook yesterday, but it appears the market's starting to recognize it today as the stock really was roaring back. And I know Russell and I know him well and I think that people are underestimating. When he says things are the best ever, he means it. Bottom line, I like what I'm seeing from Domino's and Trust that management can use all the tools at their disposal to sustain their growth. Which means this stock could have quite a bit more upside side. The only thing that may be missing. Listen, Russell, is a stock split. Now I know splits don't create any actual value. I know the institutions don't like them. But the same people who buy Domino's Pizza would be willing to buy the stock if it was 48 instead of 480. Come on, Russell. Show those institutions that you work for the shareholders and the pizza buyers who often are the exact same people. Their money's back at food.

[Jim Cramer]

Coming a new meaning of a bull market. Kramer's going off the charts and looking at the recent rise in beef and cattle prices and whether or not you should steer clear for now. Next.

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[Kramer]

For years now, we've had a stampeding bull market in the price of cattle, which is why the price of a steak has risen to borderline extortionate levels. Normally when you talk to commodity traders, they'll say that the cure for high prices is high prices. Veggie people refuse to pay up and start finding alternatives. But for five years now, five years, the price of beef has exceeded even the most wildly bullish expectations. So can it keep climbing or will the beef boom turn into an inevitable beef bust? Case that question. We're going off the charts with our resident commodities expert Carly Garner, brilliant technician who's the co founder of the Carley Trading and the author of Higher Probability Commodity Trading. Garner's not a believer in the beef bull market. Believe it or not, consumers don't have unlimited budgets, so sooner or later they'll swap out a red meat for poultry, pork or fish. But cattle prices just keep going higher. Now, some of that's because supply is historically tight. Garner points out that we've closed the southern border to the meat trade because of the screw worm fly outbreak in Mexico. These things will eat cows alive from the inside out. At the same time, the President's 50% tariff on Brazil, effective August 1, could add additional supply constraints in the beef market. Garner notes that while there are fewer heads of cattle these days, each animal weighs more than ever. So supply is stretched. But maybe not as stretched as most people are. Assuming. Assuming. So let's do this. Let's take a look at the monthly chart of live cattle futures, which is now an overbought territory. We look at this when you look at the RSI index. RSI is down here, okay? This is really overbought. At the top of that, Garner says we're seeing divergence between the underlying futures contract and the rsi. In other words, the price of cattle futures making new highs. But the relative strength index has been moving sideways. According to Garner, this kind of situation can persist for for longer than you might expect when you're dealing with commodities. But in the long run, it's totally unsustainable. This is unsustainable run people. Unlike stocks, which can and do move higher overall, commodities generally trade sideways to lower over time. That's because new technologies inherently deflationary while consumer demand is elastic. Garner notes that the last cattle market boom spanned from 2009 to 2014. After that impressive five year run back by extremely tight supplies, the consumer throw in the towel and so did the cattle. Bull market vet people just stop buying beef. That matters because the current bull market is also less. For five years so far, consumers have accepted higher beef prices. But if history repeats, we could be nearing the breaking point. What makes cattle prices tricky though, is that they've become wildly dependent on direction of the S&P 500. Over the past 60 trading days, Garner points out, the S and P and the cattle prices have moved in the same direction 80% of the time. Now you can argue this comes down to the wealth effect. Higher stocks mean people have more money, which they can therefore spend on overpriced beef. You know, I'm not buying that. Either way, cattle prices seem joined at the hip with the S and P. Now let's talk about the s and P500. Take a look at this monthly chart. Okay? Garner wouldn't be surprised if The S&P 500 rallies to 6,500 in the coming week or two. But Carter says that seasonality often turns sour in late July and in August. Historically, when the market enters earnings season hot, it usually exit the other end cold because of the buy the rumor and sell the news phenomenon. Unfortunately, these seasonal headwinds coincide with serious technical resistance. Garner has long been a believer that if not for the government's aggressive stimulus during the pandemic, the SB would have remained stuck in the post financial crisis. Its trading range range, as depicted by the black lines on the chart, that much, much lower than where we are now. We're now in a new range defined by the blue lines. But every time the S and P touches the top of that range with an overbought relative strength index like we have now, Garden points out the market sold apart, that pattern continues. She thinks it'll be challenging for the S&P 500 to surprise past 6500 on this pass. And if it fails to break through, the closest real floor of support is 5750. Although Garner would be surprised if we come all the way down to 5250 in a major correction might even retest the highs of the old trading range near 4800. Garner's not saying that that's where we're headed, but she thinks the S and P has reached a point where the potential upside is limited, while the potential downside is get this enormous bad news for stocks and also bad news for cattle prices, which have been trading the same direction as stocks about 80% of the time. What else is correlated with the cattle futures? Well, how about the US Dollar index, which measures the greenback against a basket of foreign currencies? Throughout the previous 60 trading days, the dollar index in live cattle futures have settled in the opposite direction just under half the time. While that's not the strongest correlation out there, a stronger dollar would clearly put pressure on cattle prices. The stronger the dollar gets, the cheaper it is for us to import beef from, say, Argentina. Of course, lately the dollar has been weakening, but take a look at the monthly chart of the dollar index futures. Wow. Lot here to adjust to Garner, it said. It sure looks like our currency has put in a bottom thus far. She points out that Trump 2.0 has played out identically to Trump 1.0 in terms of dollar the greenback rallied into the transfer of power to the Trump administration with a temporary breakout followed by a precipitous nearly 15 point decline in the dollar index. During the first Trump presidency, the dollar index sell off fell slightly short of the money trend line and rallied sharply to the top of the range before retreating to the lower trend line. If this pattern continues to hold and she expect the dollar index to rebound from 97, where it is now, to 110. Okay, not that much. But still before eventually pulling back again. To put this in perspective, in just that, shift in exchange rates could pull live cattle prices from $2.25 where they are now, down to A$80. In the end, Garner believes that when it comes to commodities, the fundamental narrative is always loudest at the top or the bottom. For example, when oil peaked at $100 in 2008, most of the world believe we're running out of fossil fuels. Then the economy collapsed and we invented new technologies like fracking to unleash all sorts of previously inaccessible oil and gas fields. Livestock is obviously a different animal. Rebuilding herds takes time. Nine months to give birth, then another two years for the new cow to grow up. But as Garner sees it, high prices encourage ranchers to get their heifers making calves as fast as possible, while encouraging consumers to eat literally anything other than beef. Beef. Plus, when egg prices got too high, the government took unprecedented action. Increased supply. Maybe something similar could happen with beef. Here's the bottom line. High beef prices have been agonizing for me personally. But the charts as interpreted by Carli Garner suggest that there's only so long that this can go on before the cost of cattle comes back down. I want to take questions. I want to start with Gary in Maryland. Gary, Jim Boyards honor the your show. I've been watching you for over 20 years. Oh, you're too kind, man. You're too kind. Thank you, buddy. Long time. It's a good show. I always watch it. I don't always miss it. I don't want to miss it. It's very good. I want to find out about this. I want to find out about this stock. Caesars Entertainment. Yeah, I'm not a buyer. Caesars Entertainment. I understand. I mean, I read that by that book, by the way, about seizures. Thank you, Ben Stoder, for giving it to me. It doesn't influence my thinking, other than say that I don't know why we want to be in this Also ran. If you want to be in casino, you want to be in Wynn. Okay. Win is the way to go. Now let's go to Hutch in New Jersey. Hutch. Hey, Jim, it's Hutch from New Jersey. How are you? I'm doing well, Hutch. How you been? Good. Hey, I would think Salesforce. What do you think about that? You know what People don't like these software companies. Now we have a small position of it for my charitable trust because we've owned it for years and years and years. I think that the software stocks have been a not great place to be. This is one of them. And I do think that, that there are fewer and fewer people who want the software stocks because they're licensed stocks. And with, with, you know, when, when you have what I regard as being, let's say generally you do not necessarily need as many people at the company. And if that's the case then therefore you won't have as many, what's known as seats, people who will subscribe to Salesforce. So I think that's what's really. Elliot, not as many customers available. Let's go to Ian in Florida, please. Ian. Hey. Booyah. Jim, how are you doing? I'm doing well, how about you? I'm doing great, thank you. Jim, I want to ask you about a semiconductor stock that was looking like I had a nice uptrend. Well, I like the company. What do you think about Marvell? You know what I think it shouldn't, it should have gone up after that last quarter. I think Matt Murphy did a terrific job. I don't really understand that it's sustained decline. I think that this stock could be ready to roll. Now Texas Insurance reported a number tonight and again gave weak guidance. Now they're not exactly the same but I will tell you that I think that you could see this stock down along with Texas Instruments because Texas Instruments was that bad. Okay, the charts is interpreted by Carly Garner suggest that these elevated cattle prices might come down soon. What can I say? Say she's not that bullish. All right, now much more money ahead. The homebuilder spent the better part of a year in the doghouse, but wow, this Dr. Horton came roaring back today. Is this the term we needed to get the sector back on track or is it one giant short squeeze? I'm digging into the latest then the meme trade has set its sights on calls and I'm sharing why. This particular stock caught the attention of social media and of course all your calls. Rapid fire tonight suggested the widening round, so stay with Kramer. After struggling for the better part of a year, the home builders came roaring back Today, led by G.R. horton, the largest home builder in America. After it was basically a two and a half year rally. The home builders ran into a bit trouble late last year with some housing markets cooling up significantly, especially Florida, but also Arizona, the Southwest. And I think you could also blame stubbornly high mortgage rates. When tariff related recession worries entered the picture earlier this year, the whole group got clobbered again. For example, Dr. Horton pulled back 45% from its September highs to its April lows. Since then though, these stocks have been making a comeback as the recession worries subsided. And there's been some hope of lower rates on the horizon. We kind of sold maybe the beginning of that today. Horton rebounded from 110 to 131 as of last night's close. Then this morning the company shot the lights out. Dr. Horton reported 23,168 homes closed in the second quarter. That's what other home, other homebuilders call deliveries. And that was down 4% year over year, but nicely ahead of the 22,040 number that wall street was looking for. The average selling price comes in at 369,000. Remember these guys sell lower end homes pretty much in line with consensus estimates. And homebuilding revenue came in at $8.56 billion, all right down 7% year over year, but much, much better than the 8.19 billion that the analysts were expecting. Expectations have been reduced and now they were handily beaten. Jill Horton also their total revenue, which also includes results from the company's smaller lot development company Four Star Group, as well as its rental operations, came to 9%.23 billion. When the analysts were looking for 8.75 billion, company's margins were substantially better than expected. Now that translated into a magnificent 47 cent earnings beat off a 289 cent basis. Again, not great in absolute terms. Okay, as the earnings were down 18% year over year, but they crushed the expectations on earnings and that's what matters. Doesn't hurt that Horton bought back $1.2 billion worth of stock in the quarter. And in fact they've reduced their share count by 9% over the past 12 months. Fewer shares means more earnings per share. And by the way, keep this in mind, a more intense short squeeze as the people betting against the stock can't find as much stock to cover. That was part of the rally today. All right, how about these forward looking numbers that matter so much? Horton's net sale orders were roughly flat year over year, but quite a bit better than expected, especially in dollar terms. They're cancellationary 17% in the quarter, a tick down from 18% the year before and better than the 19% number that Wall street was looking for. So overall the orders numbers look pretty solid, even if the company had to compromise a bit on price to get these sales done. Finally, Horton updated its full year forecast for 2025, which for them is the 12 month period ending in September. The company shaded down its home's closed outlook, but that forecast was still better than expected. They also tightened their consolidated revenue outlook, lowering slightly at the midpoint, but it's still pretty much in line with expectations. On the positive side, Horton said they Plan to repurchase 4.2 to $4.4 billion worth of stock this year. That's up from 4 billion previously. And management reiterated their full year cash flow from operations forecasts. Basically, the company slightly lowered its full year revenue guidance with just a couple of months left in the fiscal year, but it's still above what the street was expecting. So even though they lowered, it's still better and the abundant buybacks certainly don't hurt. That's bigger reason why the stock shut up. An astounding $22 or 70%. That's one day's trading. An incredible move. Let me see. I don't even have anything that's good enough for this. Just a second house of pleasure with some of that coming from what I just mentioned was a short squeeze because lots of hedge funds thought that this group seem right for a bruising given what President Trump describes as too high interest rates for people to buy homes. At the same time, management gave us some good color on the state of the business during the conference call. Long story short, CEO Paul Romanovsky said that even though homes remain relatively unaffordable, we know that and buyers are cautious, we know that Horton has been able to cope with this by increasing their sales incentives. Management expects that type of environment to persist through the current quarter, but they're working through it now. One negative management mentioned during the call was the fact that their homebuilding gross margin should slip a bit in the current quarter because quote incentive costs have increased on recent sales anchor. But that's already reflected in the updated guidance, which again was better than expected. It certainly wasn't enough to derail the buyers. Of course it didn't hurt the buyer. Polygroup, another major major homebuilder reported much better than fueled quarter this very morning. Oh, and I'm sure nobody in the industry is complaining that President Trump floated a plan to estimate eliminate the capital gains tax on home sales. Now I'm not the biggest fan of this idea. We just got some huge tax cuts already and married couples can already Exclude up to 500,000 capital gains the primary home. So this is something that would only benefit the super uber rich. Besides, I Don't see why one capital kind of capital gains should be treated differently from any other kind of capital gains. Doesn't make any sense. That said, whether or not it's good policy, it would certainly be fabulous for all things housing. I think that was the icing on the cake of the homebuilders rally. Even if the odds of this policy becoming law don't to seem seen that high. Although it does seem when the President wants his way, he gets it, doesn't it? And look, the whole group caught fire today. It wasn't just Horton up 17%, Pulte up 11.5%. Toll Brothers and Lennar both shot up more than 8%. They didn't have any company specific news. It was pure pen action. The homebuilder ETFs like the X, HB and the ITB rallied 5.6 and 7.9% respectively. Not really. Plus the gigantic short covering really sent these things flying. At the end of the day, this is a space most investors have been down on very long time. And you know, may it still be true despite the group's modest recovery from the lows over the past few months. But these results tell us that homebuilding business just isn't that bad right now. Especially when these buildings are pro builders are proactive, reading the market realistically and offering incentives where needed to keep up their sales volume. So I think that the nation come back for the builders can continue at least for the time being. Although eventually this will come down to whether or not the Federal Reserve decides to start cutting interest rates again. But the bottom line, the housing market, while not perfect, is a little more solid than we thought. Expectations so low for the builders, solid results are enough to allow these stocks to soar like they did today. Wall street simply got too negative on this group. Which is how you get these explosive rallies in doctor who, Horton and Bulky Home that spill over into Lenore and Toll Brothers and the rest of the industry. And if you believe we've got tariff induced inflation under control and the Fed will feel comfortable cutting rates sometime relatively soon, then the homebuilders could have a lot more room to run. Money is back. It's the break coming up.

[Jim Cramer]

Kramer takes your calls and the sky's the limit. It's a fast fire lightning round.

[Kramer]

Next. It is time. It's time for the light round. Creators everybody. That's RAV Gore. Let me save the stock. Excellent. Bye bye bye sells. So sell. Just to be clear, I know the core stocks are ahead of time. My staff prepares to grab to Apply you playing the sound and then the lightning round is over. Are you ready? Ski dad some of the lightroom can Harry in Georgia. Harry. Harry in Atlanta, Georgia. Club member. Yes. And the home of Atlanta to Coca Cola and Home Depot. And my question tonight, ups. You know, UPS is a real quandary. I love that yield. But I do think that fundamentals are still hurting. I'm gonna have to take a pass on that one. Don't buy. Don't buy. Don't buy. Don't buy. Now let's go to Arthur in California. Arthur. Hey, Jim. Happy Tuesday. Yeah. This feels like forever. Then go ahead. So I'm calling about. I. I took a very small position. It's my Rob and I was looking to build up more on it. It has good dividends, but it's been on a very downtrend but not at the all time load. That paper is ConAgra. ConAgra. Okay, here's what's going to happen in the next two days. ConAgra is going to be up because we're involved in a rotation. And then on day three, I think you want to exit stage right on ConAgra. Let's go to Tanya in South Carolina. Tanya, hey, how are you? I'm just glad to hear your voice, Tanya, frankly. How about you? I'm great. I'm great. I have a question about Soundhound. Soundhound. Okay. So. So Soundhound is one of those stocks that has to be eviscerated over the next couple days because it's part of the evisceration crowd. I mean, one of the things that's happened here is we're in a rotation selling all these stocks and it's buying a stock in Campbell Soup. Now, that is not necessarily my kind of rotation, but it is one that is going on and I have to say I would be a little careful. Soundhound. Let's go to Sam. Massachusetts. How are you? I'm not biting. Sam, how are you? I'm good. You know, Jim, I was coming through the industrial sector because I was looking to find a stock that was in this bull market for heating, cooling and ventilation. That's where I came across Modeling manufacturing. With its $4.9 billion market cap, the company did roughly $2.3 billion in sales last year. And it's fundamentally looking strong. So I'm curious what you think about modeling given the bull market. Look, I think you don't need. Modine's got a lot of good things going. It is a good, good industrial. It's not a great industrial. We've been buying just, you know, for. For the Chapel Trust. We've been buying the stock of Dover. I think Dover is a better play for you than Modine. Let's go to Clark in Louisiana. Clark, Jim Cramer. Incredible. Big fan. Big fan.

[Carly Garner]

2005 Parkers and Mass.

[Kramer]

Who bought me the first Jim Cramer. Real money, sane investing in an insane world. Yeah, that's where booyah came from. Booyah's from there. All right.

[Carly Garner]

Ticker is ETR.

[Kramer]

ETR. Man, I'll tell you, ETR's had such a run. I know it can go higher, but I mean, it got, you know, it's metal like shit. And everything I'm gonna say right here, don't buy, don't buy. And that, ladies and gentlemen, conclusion of the Lightning Round.

[Jim Cramer]

The Lightning Round is sponsored by Charles Schwab. Coming up, getting the short end of the stick. Kramer's helping you make sense of today's declines in Kohl's and whether the short sellers have it right about the retailer.

[Kramer]

Next. It all started on social media. I saw it on Reddit's Wall street bets section. It's time to buy the stock of. Why? Because of the gigantic short position. That's why. That's why Kohl's didn't shoot up nearly 38% today because of its deal with Sephora. It wasn't that relationship with Amazon either, where you can return goods bought from Amazon at most of Kohl's stores. And it certainly wasn't Kohl's Cash or some of their store brands, even as I begrudgingly admit that I like them. No, it was all about the short position, which is close to 50%, five out of the float. Yet nearly half of the shares that trade were sold short. Whenever you have such a huge short position, it's easy for buyers to get together online and orchestrate a short squeeze. Defenest trading the hedge funds that are shorting it. To which I say, what the heck do the shorts, not the maesters, but the shorts, think they're doing here? This chain with the balance sheet that isn't all that bad simply should not be that heavily shorted down here. It's moronic. Calls may not be great, but it isn't terrible either. For the hedge funds, it's almost as dumb as staying short GameStop in 2021, only to be run over by the social media, specifically the Wall street bets outfit and the meme stairs that bought into the short busting at the end of September. I have a book coming out. It's called how to Make Money in Any Market. And I got a chapter on GameStop. I try to philosophize about how the Reddit people didn't necessarily love Gamestop at all. They didn't go to the store, but they sure hated the shorts and they wanted to rip their lungs out. When they marshaled the Wall Street Best crowd, they had the perfect foil to the shorts. Once these longs get on the same page, it was only a matter of time before the short sellers were crushed. I write that the shorts ought to start reading Wall Street Best because it's a powerful force in favor of a company by happenstance and against shorts by design. And Kohl's was a textbook example of a stock that had become perfect for the GameStop playbook. Ganging up on the shorts was like shooting fish in a barrel. No, I don't like to shop at Kohl's. I find it a dowdy target filled with merchandise that I can get for less than TGX from willing to wait long enough. When the stock was in the 53 years ago, it did get multiple takeover bids from some pretty smart people. Then the company seemed to fall by the wayside and the biz dried up. Maybe this. That was the clarion call to the short sellers. It was time to operate on calls. I get that. And hey, the shorts have made a killing over the past few years. In this one one, there were some dubious changes, management and a sense that the chain just can't seem to find a way in a world dominated by Costco, Wal Mart, and Amazon. The stock was subsequently eviscerated and fell as low as six bucks right after Liberation Day. That's precisely when the short should have covered. When a stock you've been betting against goes from 60 to 6, you declare victory and you ring the darn registry. After all, three solid acquirers were thinking of buying holes much higher three years ago. Wouldn't it be natural to presume that at least one of them might come back at these levels? Look, I don't have a dog in this hunt. I'm not a friend of the shorts or those who are trying to destroy them. I will say that where there's smoke, there may even be some fire. Given how this one ignited into a double so fast, the shorts have clearly overstepped their boundaries with coals. They've run into a boat buzz solve their own creation. Even now, I think they'd be wise to cover the short and move on before they have another gamestop on their hands. In the end the short sellers have the wrong target. A company with declining sales and a lot of debt, but not one that's about to fall apart. Which is what you need if you're still shorting calls down here in the single digits. Hedge funds, take my advice, cover and move on. Like I said, as always, bull markets. On my promise to find it just for you right here on my money. I'm jummer. See you tomorrow.

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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 did you know.

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