Listen to Jim Cramer’s personal guide through the confusing jungle of Wall Street investing, navigating through opportunities and pitfalls with one goal in mind - to help you make money.
Mad Money w/ Jim Cramer
Mad Money w/ Jim Cramer 8/7/24
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Welcome to Kramer, I'll do my prints. I'm just trying to make you a little money. My job is not just to entertain, but to educate and teach you. So call me at 1-800-7-B-C-B-C. Tweet me at you, Kramer. You can't hope for rate cuts from the Federal Reserve and it'll also expect zero weakness. In any part of the economy that impacts your portfolio, let me tell you, Wall Street wants to have it both ways, but we'll never get those rate cuts until the Fed sees cash-strapped consumers rebelling against higher prices. Forcing companies to roll them back to pre-COVID levels. And that is what is state right here. And it's playing havoc with the averages. They all sinking 234 points. S&P, falling 0.77%. And then as that, losing 1.05% again. How can investors navigate these treacherous waters where we want just enough wheatness in the economy to push the Fed to cut, but no damage whatsoever to the stocks of companies we own? Well, look no further than the stock of the Walt Disney Company. I follow Disney very close to me on some for the child with trust. I like it in part because of the price. Disney traded at 123 and changed back in March, board shareholders, especially the big index funds, voted against Nelson Pills. Can't an investor who wanted to join the board and offer advice on cutting costs and reorganizing the business. Now trades at 86. And it sure even here feels precarious as no one seems to care at all about the value of this story franchise. Today, the company reported what it looked like on the surface of a terrific quarter. And usually they stocked up five bucks in pre-market trading. Then Disney quickly reversed and only finished the day down for hours. Not really, not only the Dow Jones average where things look real good in the morning, then drip lower the rest of the day. Emblamatic. Disney's actually the perfect microcosm for the moment. They've got a bunch of important divisions like movies where Disney's crushing them. Terrific schedule, it's like inside out too. Deadpool and Wolverine. Seems like the movie drought's over. ESPN held in with ad revenues up 17%. Good news despite the court cutting. But what got me excited about the company's results? The amazing profit. A quarter ahead of time from Disney plus. I forget it would disappoint us again and maybe even again. And we hear the usual frame, only Netflix no streaming. Disney will never get it together. Long move over Netflix or at least slide over a little because Disney plus pulled it off delivering a real profit to sell a quarter earlier than planned. That to me was the real story in the day. But I'm not in this kind of market. If Disney was so good, you're probably wondering what the heck did the stock get beaten black and blue today for? And the answer is exactly why we need a rate cut. And we need a rate cut right now. The consumer no longer seems willing to pay for these storied and treasured family-friendly theme parks. Along the most consistent part of the Disney mosaic, you can count on them. The parks fail to deliver this time, fail to deliver big. I don't know if they can deliver this environment because they may be too expensive for the newly frugal and choosy consumer. Sure, the parks are exciting. But when you have to pay $734 to spend a night at the Grand Floridian or 635 a night at the Polynesian or even 526 a night for the night at the contemporary, all on top of the 109 standard theme park ticket price, 109 bucks, well, consumers are gonna have to make a choice. And maybe the choice is to not go to the Magic Kingdom. And that's why Disney's domestic parks operating income fell pretty shocking 6%. But if Matt is saying this demand moderation could impact the next few quarters. (upbeat music) So what choice is the consumer making instead? Perhaps she's choosing to go out on nine different groups, not for one owned by Royal Caribbean, which is mostly sold out, judging by what the company had to say about the state of their business and their stocks you're telling you that the state is pretty darn good. While Magic Kingdom room rates are expensive, Royal's Western Caribbean and perfect date crews will only set you back $114 a night, but we had $132. You can sell five days for the price of one overnight room at the Floridian. Thank you so much to what's to go first. They definitely want to go, they want to travel. Post COVID, you can only live once in state still with us. Top of the list of things that we're spending on, right out of the pandemic, people are more than happy to pay Disney prices. But we've changed. We're now a lot more choosy after years of higher prices. Inflated prices, we're done, we're done. You can have a terrific time on a cruise and take just as good pictures for your Instagram without Mickey or Pluto photobombing your instant action. Despite all the negativity, I come back and say, "Well, wait a second, wait a second." There are other things besides just theme parks. You can get this incredible franchise for just over 17 times earnings. Watch shipping the average stock. I haven't seen this cheap in a very long time. I tell people in the investing club today at our morning, minute, 10, 20, that I am itching to buy back the stock we sold much higher after the pelts' fracas. I think the parks problem can be solved. I like the streaming profitability problem, which I thought would just kind of be with us for a while. Because the rest of Disney is at last working so well, you know what they can do? They have the ability to cut prices at the parks that they want to. Even as I know those places cost a fortune to run. And I'm confident that the federal cut rates, which could take the pressure of the consumer away from the parks. What happens then? Well, I think Disney's parks bounce back because it's not like they've lost the relevance. It's like they're stopped being great places to go. They're just more expensive than the alternatives, like cruisers. Fortunately, Disney has a cruise line of its own. It's expanding, but not fast enough. And the gross margins on new ships are getting in. Well, they're not as attractive as the broken in ships. Of course, I brought up Disney, not just a harp on the fact that I think it's a bargain here. And yes, if it goes to 80, it'll be more of a bargain. I brought it up because it's emblematic of problems that many companies are having. One of my favorites, Airbnb told us just last night that it's seeing a slowing and domestic bookies again, something that's new, something that's worrisome. It dovetails with what Marriott's seeing and another good operator. I thought Airbnb was such a bargain, it wouldn't get hurt. But right now, consumers are under such pressure that Airbnb seems pricier than we thought. Also, if you bought your home with a high mortgage rate in the last couple of years, you're going to charge more to rent it. And then maybe it doesn't get taken. Unfortunately, you can't roll back Airbnb prices in some central office, but I sense that some deflation's coming here too. Now, we know the consumers odd sometimes in making their choices. I mean, she's still spending a ton on Uber's and is willing to pay through the nose for restaurant food deliveries, accepting the total door dash charges on each sale. Why? You know what? Different things occurred during COVID. I think the consumer learned to love the convenience during COVID and now just doesn't want to give it up. When your economists talk about this process, you know what they call it? They call it normalization. The end of all sorts of exaggerations you swap because of COVID or the perhaps the post COVID supply chain hangover. The consumer got real liquid from doing nothing during the pandemic and was willing to accept the higher prices of theme parks, but that's no longer the case. We have what I call an empowered consumer and that consumer is going to force rollbacks on price by voting with her feet. She isn't mad as hell and not going to take it anymore. She's just mad at some options and happy with others because they're cheaper and better. Bottom line, the fact can rejoice and stretch the time before it cuts rates until it sees the disease of the world cut prices on mass or it can anticipate what's going to happen and move now. I think it does the latter, but the consumer's still not going to come back to Disney World until the grand fluridian drops to the price of the Polynesian and the Polynesian dips to the price of the contemporary. Until then, the stock will languish like so many companies that have tried to hold the line on high prices because that's now a losing proposition, a losing proposition to which both Wall Street and the consumers rub belly. Let's go to Luke in Louisiana, Luke. - Oh yeah, Mr. Kramer. - Oh yeah, Luke, what's going on? - It's good to talk to you. I'm calling about IBM, big blue. I usually just bet on LSU to beat Arkansas. That's candy from a baby, but if they're looking at IBM and the market cap has been holding here for 20, 25 years. Now I'm hearing about quantum computing. I'm hearing about that they're the forerunner in commercial security. Is quantum computing the real deal? Will IBM, big blue, finally great guys? - You don't need quantum computing to be the real deal. They are just executing like, they are actually like a fast Gillette razor. I gotta tell you, I really like what's going on there. I think that stocks valuation is not stretched. You still get the dividend. They're doing a terrific job, I think. - Bye, bye, bye. - Mike in Oregon, Mike. - Hey, Jim, Beaver Mike here. Hey, I'm looking to increase my industrial exposure. I already own Honeywell and Stanley Black and Decker and considering starting a new position in either Eaton or Dover. Given the current market, which of the two would you recommend to start with or is there something else? - Okay, no, no, and I think they're both great. Now both of them are connected to the data center. If you know, but Dover has less data center as a percentage of it's a mosaic than Eaton does. I would say by Dover right here, I pull the trigger, you know, because you're a club member. I can tell that's the one you want right here is Dover. Let's go to Daniel and Alabama, Daniel. - Jim, Booyah. - Booyah, Daniel. - Long time listener, Roll Todd, man. Hey, that's my mom, my dad, and my Analaine. Hey, so my question is on Moderna, all right? So pre-pandemic buyer, I've seen the process, I've trimmed along the way, get a little knee jersey with price action recently. What do you think about that when Outlook was? - Okay, I think that Moderna, I was hoping they could use AI to solve the puzzle here. But, but do not producing that personalized cancer vaccines that I thought they would. And that is a lot, like a lot of other people we feel let down by the company, we feel let down that this bansell, step on bansell has not been able to crack the code of cancer with personalized vaccines. And that's why that stock keeps going down. All right, listen, the vacuum rejoice and stretch the times before it cuts rates until it sees the Disney's or the world cut prices on mass. That's one way to look at it. Or I can anticipate that that's when it's going to happen and start cutting rates for trades real soon. Oh man, by the time CVS helped chop this 2024 podcast for a third time this year, with the stock heading lower on the news, I'm checking the company's vitals in my post earnings exclusive. Then the stock of Celsius has been a dog lately, but what the heck? They just reported another record quarter. What's going on? I'm talking to the CEO. And Dev and Energy is moving higher after earnings. I'm going down on what's next for what could be end up being the premier independent oil company in this country. We'll sit down with the company's top brass, stable family. (upbeat music) Don't miss a second of Mad Money. Follow @JimCramer on X. Have a question? Tweet Kramer, #MadMensions. Send Jim an email to madmoney@cnbc.com or give us a call at 1-800-743-cnbc. Miss something, head to madmoney.cnbc.com. Trading at Schwab is now powered by Ameritrade, giving you even more specialized support than ever before. 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Indeed's matching engine is constantly learning from your preferences. Join more than three and a half million businesses worldwide that use Indeed. Listeners of this show will get a $75 sponsor job credit to get your jobs more visibility at indeed.com/madmoney. Just go to indeed.com/madmoney right now and support this show by saying you heard about Indeed on this podcast. Indeed.com/madmoney. Terms and conditions apply. Need to hire? You need Indeed. Breaking news, the peanut butter group and Chocolatey Corp have merged to create PBC Inc. And the byproduct of the merger is the new delicious jiff peanut butter and chocolate flavored spread. I got the press release and get this. Critics tried to say it creates a monopoly on cravability, but obviously it's not illegal to be irresistible. Calling it now, this will revolutionize the snack industry and the contents of my pantry. Visit pbcincorporated.com to try the flavor merger of the century, Jiff, PBNC. All right, what's going to take for CVS health to turn itself around? We know the drugstore space has been in trouble, but this is the drugstore that's done the most diversify away from its core business. And at the moment, right now, it may not be working. This morning, CVS reported, while the results were pretty solid, they also cut their full year earnings forecast for the third time because they're managed care business. The old Edna is under pressure. Management originally got it for the earnings of at least 850 per share at their investor day last December. They cut at least the 8/30 in February for cutting it again to at least seven in May. And now they're saying maybe 640, 665, very hard. But what's the broader plan to turn things around? And we know it can be turned around. So let's go straight to the source. But Karen Lynch, the president's CEO of CVS to find out. Miss Lynch, welcome back to Med Money. - Thanks, yeah, nice to see you. - All right, so Karen, that's a tough litany, we know. We know you're also up to it because you are taking direct charge of the area that a lot of people feel is now causing some problems, which is the healthcare benefit segment. Don't want to get the corporate for the worst, but you've solved a lot of the problems so far. Even since we talked to you in January, but now this one's popped up. - Yeah, Jim, let's just take a step back. I think you have to look at the totality of the business. You know, many of our businesses are performing well. Our retail business, our pharmacy business, are performing well. We have the best market share that we've ever had. And our care mark business, our PVM, doing well had a very solid performance in the quarter. Our problem, as you said, is the at in a business. We've had some challenges. The industry has had some challenges. And I, as I said this morning, I wasn't happy with the financial performance of that business. I'm taking direct ownership and am going to focus on the financial and operational execution of that business. - Well, it's tough because there was a time when you were not highly, you're at wasn't rated enough. They weren't giving enough to customers. And then you went the other way and you gave a lot to customers. You became the favorite plan. How do you balance these things? Because to me, it takes a wizard to do it. - Well, I think you have to really, it's all about focus and discipline. And I feel really good about our Medicare pricing for 2025. We took the enterprise wide approach. We brought all of our resources to bear. We feel really good about where we're headed for our pricing for 2025. - And we expect to recover margins of one to two basis points next year. - Now, when this whole idea was put together, some of it was defense. They felt like, look, you want to use the bricks and mortars. Got to use them for more than just Amazon carry on, so to speak. Make it so that you can use it as an entry to bigger healthcare situations. Now Oak Street health and signify seem to be working. You're absolutely right that when it comes to where we get our shots, we go to, we know to go to CVS. The stores that are still, that you kept open, you say they're almost all profitable. So, I mean, if this piece fell into place, this healthcare benefits, could you have the leverage model and get $8 in earnings or more? - Our goal, yeah, we have really strong momentum going into 2025. You said that our pharmacy businesses performing well, our Oak Street businesses performing as expected signify had a record number of home visits. And we expect to see, you know, positive momentum through our Medicare pricing, through our, we've had really good success in our national accounts and care market at now. We introduced a productivity initiative today as well. So we're pleased about where we think 2025 will land. - Okay, now on April 30th, Walmart decided to close. It's Walmart healthcare services division. There were 51 clinics, they tried it for five years. They even had 46 hundred pharmacies. They said they could not make it work. Reimbursement environment, escalating operating costs create a lack of profitability that makes the care, case, but care business unsustainable. How do you feel about what they did and your model versus theirs that makes it so that you can do it, even though Walmart's got the balance sheet in the industry, they had the dropout. - Well, think about this. We have an intentional strategy to give consumers what they want. They want clear access, they want affordability, and they want low cost. And so what we've done with Oak Street is really focused on Medicare members who have chronic conditions. It is a very targeted strategy to support the Medicare population. We have an insurance business where we have Medicare members. So we are having good success. We have tripled the number of at-no-members in our Oak Street clinics since we've had Oak Street. And I think if you look at our strategy, it's the right strategy at the right time. - Okay, so the stores that are left, are they bringing in more than just customers, so to speak? Because we do know that, say, when Amazon does its Amazon Prime, they're really in some ways targeting CBS and Walmart. I mean, are you able to withstand an online company that is incredibly low-cost and withstand them because of all these ancillary things that you bring in? The bricks-and-mortar strategy is working with you. - The bricks-and-mortar strategy is working with us. We actually have said that we have to be in a community to provide pharmacy benefits, to provide immunizations. We talked about the before the show. And what we've been doing is changing some of the formats to include Oak Street and a pharmacy, and we're starting to see traction there as well. - Okay, now in the New York Times just penned a story about zombie pharmacies. This is a problem that they said is all over the country, particularly Cute in New York, and they mentioned CBS. They say that when you are trying to get out of them, that you still have to pay the lease because the leases are so high that the landlord doesn't want to bother to release. They want to make it so that you pay. Is this a problem? Or are you almost out of the zombie store business and all your places are relevant? - I think we have had a very clear strategy of the course of the last three years to reduce the 900 stores. We've reduced those 900 services. We have 851, we have a couple left, and we feel confident in our strategy about the number of stores we have. - Okay, and January, you told me that you were piloting the idea that maybe self-checkout was where Pilfridge was, and you were trying to figure out whether to skill it back. Where is Pilfridge, and how have you done with self-checkout? - It is a great question. We still are seeing theft. It is still challenging us. We've seen less of it, but you'll be happy to know that we are introducing new technology for loyal customers like you. We're piloting in New York stores where if you are a CVS health customer, you'll be able to use your phone and a QR code, and then you'll be able to unlock the lock that's locking up. - I don't have to press the button. - No, you'll be able to unlock it with a QR code. We have actually a couple stores in New York that we're piloting it right now, so maybe a store near here. - That's brilliant. That's the secret. - We're very excited about technology. - You got it, not the idea. What's fabulous? - We have to fix the theft, but. - Now, we have an election coming up. I mean, how much do you have to sit there and parse through what people are saying, each presidential candidate? And how much of it is really state versus federal that you have to worry about? - Well, I think the way you have to think about it is we're in the healthcare business and we're here to serve healthcare and meet the needs of the demand of consumers in their healthcare needs. That doesn't, it doesn't matter who's in office. Healthcare is personal, and that's what we're trying to achieve lower cost, affordability, and quality of healthcare. That matters to consumers, and it doesn't matter what the election bears. That's our objective, that's our goal, and that's our strategy. - Okay, one is thought. It's a thought, I know it's not what you want, but it's the way that you want to value things. I look at your company, and I think the sum of the parts of this darn thing is so much more than what it's selling for. At the same time, though, that's not the goal, is to break the company up, is it? - We have an integrated strategy, and that strategy is working. We're seeing traction across all parts of the strategy, and as you might imagine, we always look at our strategy, and we evaluate it in the terms of our long-term shareholders. - And if you had unlimited capital, would you put it behind the brick and mortar? Would you put it behind Oak Street? Would you provide signifier? Or, where would the chips go? - The chips right now would go into fixing healthcare, fixing the business, obviously. That's where our wife focuses, because the other parts of the business are performing well. - Well, you look at me now and tell me that you can do a better job. I know you made a replacement. I know how hard that is. I've had to do it myself. That you can deliver on this, on the at-naportion, because if you can, you know you're gonna have a lot more than eight parts of it. - Yeah, I like to admit that it is. I know this business, I know it well, I know where the opportunities are, I know where the issues are, and I am very focused on it right now. - Well, if anybody's gonna do it, it's gonna be you. - Thanks, Jeff. - That's Karen Lynch, President CEO of CVS Health. We all go there. It's our pharmacy. Maybe it's the at-n-a hidden piece that's holding it back. They can change. They have bodies back into the front. (upbeat music) - Coming up, the stock with a can-do attitude, taking the temperature of Celsius, next. (upbeat music) - Trading a Schwab is now powered by Ameritrade, bringing you an expanding library of education with even more ways to sharpen your trading skills, access new online courses, insightful webcasts, articles, engaging videos and more, all curated just for traders. Plus, guided learning paths with content designed to fit your unique interests. No sifting to find exactly what you need so you can spend your time learning to trade brilliantly. Learn more at Schwab.com/trading. - At EverNorth Health Services, we believe costs shouldn't get in the way of life-changing care, and we're doing everything in our power to make it possible. Behavioral health solutions that also keep your projections at their best, it's possible. Pharmacy benefits that benefit your bottom line, it's possible. Complex specialty care that cares about your ROI. It's possible, because we're already doing it. All while saving businesses billions, that's wonder made possible. Learn more at EverNorth.com/wonder. (upbeat music) - Okay, what the heck is happening to Celsius? It's a commonly high-flying energy drink maker, seen at Stock Plunge from the 90s in May to the high 30s today. Now some of that's purely thanks to the rotation out of fast growers with enormous gains. Celsius has become a prime target for profiting because it's still up more than 2,500 percent over the past five years. We got asked, "Is something else going on?" When Celsius reported yesterday morning, they reported record-second quarter results. Management also made some somber comments about the state of the broader energy drink category, not the company itself. And stock finished down more than 2%. Let's check on the jump field. He's the chairman, president, and CEO of Celsius Holdings. You got a better sense of the quarter, but come to the next question field, then welcome back to Mid-Money. - Glad to be here. - Okay, so let me tell you what I see happening here, John. I think you've got the best house and what increasingly people are thinking is a bad neighborhood. Does the neighborhood have to get better for your stock to fly? - Well, Jim, we just broke record revenues, 400 million in revenue, 100 million in EBITDA, best quarter in company history. We were a little bit somber, talking about the consumer, saw the category decrease for the first time since 2020 on a weekly read. It was growing strong in the beginning of the year, but the reality of it is, Jim, the sugar-free category continues to be the growth driver and energy category, and Celsius is the category driver growth. 47% of the growth in the category is coming from Celsius. We got an amazing sugar-free portfolio, most refreshing energy drinks out there. Just, you know, we'll talk about summer. What better than to have a watermelon lemonade? I got one today. Absolutely amazing. - Now, how about new entrances to competition? Remember, I'm trying to figure out why you have a 12% short position. I'm trying to figure out why the stock doesn't have what I, what monster have. Remember, monster was the greatest performing stock over a 30-year period. - I had thought I can still think that Celsius could. I'm trying to figure out what is holding back the stock 'cause it's not the company. It's not the fundamentals. - Well, I think, you know, and you look at it, the fundamentals are strong. You look at the category. You know, there's a lot of concern. You hear a lot about the consumer. We're hearing a lot of analysts on Wall Street are saying, you know, the category, energy category has been the growth driver. It's transitory. A lot of people expect it to be picked up at the end of the year. Start to see growth back. Energy is a lot of people see it as a luxury, and it's an affordable luxury. Rodney and Hilton talked about it on their earnings call today, the monster call. Energy category is not slowing down. More consumers come in. We need more energy. Celsius provides that better for you energy. We're in good shape long-term. - Okay, now, most recent study that makes healthcare chemists all the way back 15 years ago, anything new, anything that update, anything I can point to, which tells people how good this is for you. - The product, we take great pride where we're premium products. - New studies. - We don't have any new studies out yet, but premium product, premium ingredients. Quality is top-notch within the product. We stand by it 100%. - All right, now, what is the deal with PepsiCo in the inventory problem? PepsiCo is more than 50% of your distribution. It's absolutely true. You can't get crosswise with Pepsi. You have to stay right with Pepsi. - Correct. - At the same time, I don't wanna hear anymore about this inventory adjustment, and the 20 million and 30, that's too hard for me. And I am a student and drinker of Celsius. Why can't we clear up this inventory problem, PepsiCo? - You know, Jim, I think when you look at it, there is, we're still getting to know each other. There's optimization in the inventory level. - Really? Come on, Ramon. I'm all gone for dinner. - Oh, Ramon. He's a great guy. - He's a great guy. - Great business. They're adjusting inventories, they're days on hand. It can be affected. I mean, you're seeing slowdown in the category. - Great, get me on the rock star. The rock star's like, "You're a enemy." It's not a friend of me there. Rock star is owned by them. I mean, what are we doing here? - Hey, Celsius is driving the category. We're driving the energy, drink cat portfolio for them. I'm great partners, driving truck share. They're leaning in. We just did an incentive program with them to help us further lean in for the backgrounds. We wanna drive this category. Both Pepsi and Celsius are fully aligned to do it. - Okay, international. Tell me, you got 95% of your shares coming from North America. How wide open is the field? - It's wide open. We partnered with Centauri to a variety of markets. Just launched in Canada. - Those are smart guys. - They are super smart guys. They know exactly what they're doing. Great partners. We partnered with them through UK, Ireland, France. It's gonna come in later in the year. Australia, New Zealand. We're talking about other markets as well and expansion. Same health and wellness trends in the US. Our global trends, right? Better for you. They have better ingredients without sacrificing flavor. We nail that. More function in the beverageage foods we consume. We want more. Celsius is more than an energy drink. And fitness is a lifestyle position in line with everyone. - And we do know, look. Lily's gonna report tomorrow. It'll be terrible. The stock's only up because it's really important. But we know that GOP-1 actually does better with this. This is about one of the few categories that we can point to and say, yes, this does better. This in raspberries. - Yeah, no, I agree. Absolutely. - So, I mean, you're seeing any lift at all from-- - We see a lot of, you know, that's a great category for us. Everyone wants to live healthy. We're all about live and fit. - They do? - You know? - Then why are so many people obese? Interesting question. I've got you on that. No, but you've got the Olympic partnership. How's that work? - Oh, amazing. I've been here over 13 years to have us partner with Olympians like Noah Lyons, the fastest man. I mean, that's amazing. - Yeah, he's pretty funny too. All right, one next question. You know who I've got, I love on your board. You know, I love Caroline Levy. Now, what is she telling you? What is she telling you about this short position? What is she telling you about what you should do? This is the foremost analyst, beverage analyst of our lifetime is on your board. - Absolutely. - Tell me what she's saying. - She is amazing. It's an honor to have her. You know, we need to be true to the street. We need to continue to think focused on our core business. - Is she shocked at the short position given the numbers? - Yeah, but there's a lot of disruption in the category when you see the consumers and concerns. You know, I think at the end of the day, we need to execute. We got a great strategy where you got a lot of great big bets coming up. From F1, further partnerships with MLS, our lift it, tour, we got a great strategy. We need to execute. At the end of the day, we need to execute and the stock's going to fall where it falls, or grow where it needs to grow. - Fair enough. - Huge opportunity. We need to focus on the business and that's what we're doing. - That's exactly what I want you to do. Let Caroline do it. Focus a little bit on the stock because there's nobody better than she is. All right, that's John Fieldy's, the chair, president, CEO of Celsius. And believe me, I wish I had an answer about why the stock goes down because I think the stock should be going higher. They have money back in for the money. (upbeat music) - Coming up, this energy play climbed after earnings, a snapshot of the quarter with the CEO when bad money returns. (upbeat music) - Over the past month, the energy stocks have been clobbered by falling oil and gas prices. Wall Street's freaking out about potential recession. That's what happens. We're least worried about a meaningful slowdown. But I got to wonder, if this isn't the great buying opportunity we need, because every sign of weakness at this point simply gives the Federal Reserve more reason to cut interest rates. And that send stocks back up, particularly oil stocks. What might be worth buying here? How about Devon Energy? Heavy hitter in the exploration production space, poured in a strong quarter last night, probably one of the best in the oil industry. It's not the best. It was a 15 cent earnings speed of $1.26 basis, higher than expected production, especially oil production. On top of that management raising a four year production guidance in response to stock jumped almost 3% today and it kind of allows today. More important once the Fed starts cutting rates, you know, I think that this could go much higher. Plus, when Devon makes much more money, you know what? They give a lot of to the shareholders. Generous variable dividend structure and share repurchase commitments. So let's take a closer look with Rick Munkree. He's the president CEO of Devon Energy and an old friend of the show. You see what's going on. Mr. Munkree, welcome back to Mad Money. - Hey, Jim, good to see you this afternoon. Thanks for the invitation. - It's great to see you. And I've got to tell you, Rick, this combination of companies that you put together, including the new one, Wilson, which you know better than anyone in the country, is going to make it so that you'll probably be one of the largest independents in the entire country, if not the world, is the goal to be a true major built by Rick Munkree. - No, Jim, you know, that's nice to say, but the reality is our mission is, let's build a good company. Let's build a great company. And one that's, we run the right way. We're very disciplined, we're good stewards of capital, good stewards of the land, good stewards of the people. And that's our goal. And, you know, we really are pleased with where we're at, what we've accomplished thus far. We've got a lot of opportunity, a lot of hard work ahead of us. - Well, one thing Rick Munkree says known as a great operator, when you increase production 7% with actually no increase in cost and declining costs, how are you capable of doing that? That's something that almost no one else can have really much luck in doing. - Well, Jim, it comes down to assets and people. And I can tell you that we have some tremendous assets in the five basins that we operate in. It's headlined by the Delaware Basin out in the Permian. And we have some of the best acreage out there. You know, you don't have to just ask us, you can ask anyone else. But it's also the people. And you have to have the right people, the right background. And I can tell you the combination we did four years ago, we've got the best of the best. And really pleased with how things are going. We had to hit the reset button, quite honestly, you know, about 12 months ago, tied in a few things up. We've done that. And I'm incredibly proud of where this organization's at right now. - Okay, when you made a recent acquisition in the area that I said you know, Williston, some of the, there were critics who said you made me a gate tool, got stuck away. Some people don't really understand Williston, they want to stay in Delaware. But you always got that basin. Why were you so attracted to that? And even going to part with stock, which I know you find very dear. - Right. Well, the transaction was two thirds cash, two thirds, excuse me, two thirds cash was third stock. And so that's what the buyers preferred. And so we went back and forth to that. That's where we landed. We're comfortable with that. We think it's a great investment for them as well. But we really think it strengthens the company. It adds inventory for us. It's oil-weighted inventory. And to some of your comments earlier in your introduction, oil is where the margin is right now. Natural gas has got a great future. But some of us, including myself, spent the first 25 years of our career, 30 years of our career with natural gas-based companies. And we always, the future always look bright. And today the margins are, and have been for quite some time, quite honestly Jim, have been with crude oil. And so for us, having a crude oil-weighted acquisition to strengthen our already crude oil-weighted company, it's a great fit. It does build us some more scale. Give us more scale, more inventory. And on top of that, Jim, what a lot of people don't understand is with a 300,000 acre position, that is a quite large position that they were getting with this recent transaction. RGS science team, geologists are really excited about what future potential, even outside of the Bakken lies, 'cause if you were called 10 or 12 years ago, when you visited with us up in the Bakken, it was some of the early days of Bakken development, but the basin was 50 years old. There've been other horizons we were producing from. And so we're excited about what lies ahead on that acreage, and that'll be for the next generation. And the one behind that to uncover, but it's gonna be exciting. - Well, Rick, you told me at the time in 2011 that what would occur is that you might find a lot of oil, but you know what? There's not a lot of transport out of the basin. Has that important enough to make it so it's worthwhile to do a lot of drilling now? - Yeah, so I think what we did is we did over time build out infrastructure. And so right now, the Wilson Basin's in a great spot. We've been producing over a million barrels a day for several years now. Good takeaway capacity, good infrastructure. And it's just a great place to operate. Wonderful, you know, regulatory environment. And so we're just, it's just a great place to do business. - Now, we found when Mr. Trump became president, a lot of people thought that would be terrific for oil, but what it did was unleash the distance, people got undisciplined. And you told me that. People kind of went nuts. They drilled and drilled and drilled, and that drove the price down. Right now, there is good discipline. Could that happen again if Trump is elected president? - Well, I think, you know, excuse me. Where you saw a lot of the activity increase, quite honestly, was with natural gas producers. I think if you look at in the Permian Basin, we did see a couple of things we're going on. Number one, people had to hold their acreage. So either you go out and drill to hold that acreage, or you potentially lose the leases, there was a certain amount of that. There are also a large number of independent producers, the non-public producers that really looked at that price signal as an opportunity to really increase activity. And they did increase activity, increase production. Most of the public producers, we held our discipline, as we said. And that worked out pretty well. And on top of that, a lot of the private operators actually have been bought out, have been have sold to some of the public entities. So I think what you're going to see in the future is more and more disciplined, you know, and I think even the natural gas producers saw prices spiked, they got after it. And here we are again, back to where we were in the past. And so I think people have learned their lesson. - All right, one last question for me. You have a very big buyback now. The buyback is humongous versus the size of the company. Do you think that the people who got stock in this acquisition, will they be selling or they'd be holding? Because you could really shrink the flow here. - Right. Well, I think our plan is, let's just, we think it's a great use for capital. We have this excess cash flow that we're continuing to generate, we will, you know, we recall, we run everything on a mid-cycle oil price of $75. And so whether we're at, you know, down in our low break, even in the $40, $50 range, all the way up to $100, you know, we think the 75 is a good mid-cycle price to plan your business on. And we're a tremendous value. And so we're going to continue to buy our shares back. And as you mentioned, we did increase the authorization from $3 billion up to $5 billion. And we're off to a good start on that. So whether the holders, those equities that came with the most recent transaction, keep it or not, will remain to be seen. But, you know, I think, and I think, I believe they think it's a great investment long term. - Well, I got to tell you, Rick, with this acquisition and with these numbers, you jumped to the head of the class. I've been looking for some, I like Cotara. Cotara's got a little too much natural gas and let it what you said, absolutely. And we lost Mr. Sheffield's company. We love the, always loved pioneer, but it seems like Devon is the one to want to be in. And I think it's terrific that you came on the show and talk about it. Rick Munkwee, president and CEO of Devon. And great to see you again, sir. - Okay, good seeing you, Dan. Thank you very much. - Thank you, Rick. Rick Munkwee is the dean of the industry. Nevermind, he's back in for me. (upbeat music) - Coming up, hit us with your best shot and a electrified, fast fire lightning round is next. (upbeat music) (dramatic music) - It is time to talk to the light round quick. This is my cold rock part, never seen this talk, said about my bicell still just put it around the cold scarf, start with my staff. It goes later. Let us out. (buzzer) - And then the lightning round is over. Are you ready, skid? That's over the light round, 'cause it looks go to Sandy, but Dennis East, Sandy. - Hey, Jim, who here are for you? - They have you on the show, let's go on. - Doing well, thank you for asking. How's it going to help? - All right, can you throw some lights on and light on dollar genders? DLTR? - Dollar DLTR's Dollar Tree. Okay, the problem with Dollar Tree is that people I think have discovered that the small form is no longer working, they rather go to Walmart, which is a buy or Costco if they can afford the membership fee, which they should, because it pays back quickly. Nathan and Oregon, Nathan. - Hi, Jim, thanks for all your advice. - Of course. - I ask you about this stock, last year you recommended this one, and I bought it for my dividend portfolio. The stock is up 20% since that time. With a P of 18 and a 4.8% yield, should I add more? The ticker symbol is okay, E, one oak. - I think one oak is true that I would indeed buy more. I think it's a sensational company. I'd rather have a yield over five, they're 4.77, it's real good. Chad and Wisconsin, Chad. - The main, Jimmy, chill. How you doing there, Jerry? - Show me a chill man here, chill man, ready to work for you. What do you got? - Oh, an extended bouillon weekend here, matter of fact. - It's synthetic, it's synthetic Thursday. - Yeah, yeah, all right. So anyway, the question I have is a company, medical supplies company, it's been performing quite well. I'm kind of a neutral right now, it was making a fairly decent consolidation on the way up in price, looked pretty good, but now I'm starting to wonder, minus today's overall stock correction, the stock name is DeXtron. - DeXtron? - DeXtron. - Yeah, D-X-C-M. - Oh, DeXtron, okay, look, DeXtron had a real bad miss, they still really haven't fully explained why that is, I've got to tell you, I give you a reason why. One of them is because I have its libre, which is just crushing it. So anyway, I'd say we're from DeXtron. I need to go to John, I can talk to John. - Hey, Jim, John from Kentucky. - John, what's happening? - I'm listening, a real fan of you and your shows, as a matter of fact, I don't believe I'd still be in the market without you, man. - Oh, thank you, man, that's what I need you to do. - You may be smarter than me. - We can take this one today, when you've got to start thinking, "Hey, maybe I can make some money here, what's going on?" - Well, I'm CRISPR, technology COSC. - Okay, CRISPR, I happen to have a sweet spot for, I do not think that it is as dangerous as others think, because it does have some explosive technology. I would be a buyer of CRISPR. Let's go to Stan in Illinois, Stan. - Hi, Jim, Stan, from the Illinois charter market. - All right. - The club. - Oh, thank you, Stan. - We've got to work harder for you. We've got to work harder. Up all night tonight, right there. Okay, let's go on. - Well, I've owned a regional bank key corp for the dividend currently 5.7%, but your stock's stuck in a $14 to $16 range. I wonder, should I keep it? - Yes, definitely keep king. He is very, very strong, a terrific, terrific bank. I wish Mr. Gorman would come on. I know that poor too, they are fabulous. And that ladies and gentlemen's conclusion of the lightning round. - The lightning round is sponsored by Charles Schwab. Coming up, crypto was crushed in the sell-off, but Kramer is not throwing in the towel on tokens. More, next. (crowd cheering) - It's crypto's turn in the woodshed. We're all transfixed by the evisceration of Bitcoin and Ethereum during this most recent downturn, the SP500. We've been told these are store holds of value, something that you shouldn't get crushed along with the stock market. If anything, they should hold their own, if not go higher. The collapse of Ethereum is measured by the recently minted Fidelity Ethereum fund, which fell from $32 to $24 in handful of days, was jarring. Wasn't this the transactional crypto? The one that can actually be used to buy things? Was this supposed to offset everything in the world? To which they say, give me a break. When you buy crypto, you're buying an unproven asset that may also be owned by a lot of people using bar of money, which has got margin calls that couldn't meet. The iShares Bitcoin Trust wasn't much better, flowing from $37 to $30, same period. The various proxy stocks, the micro strategies, the marathon digital holdings, they fared slightly better, but none of the behavior like what you call a hedge against falling stock prices. And you know what? That makes perfect sense. The pitch for crypto is that it's like digital gold, a safe store hold of value. But that's more like a pitch for what it could be in the future. For the moment, almost everything crypto is still hostage to the general gravitational pull of the stock market, because you have many of the same owners so they have the same sets of problems. On the other hand, actual gold has distinguished itself as the store hold of value this year against pretty much everything. Unbeknownst to everyone who's still fretting that inflation is about to have a comeback, we're an extraordinary bear market for commodities. But not this precious one, which is up more than 15%, beating the pants of virtually all the conceivable competition. After a very long time doing nothing, gold has become a consistent riser since 2018 and a fabulous performer since the Fed stopped raising rates last fall, going from about 1800 to over 2400. Now, it's held up under every onslaught and there's a simple reason. As we heard from Amar El-Jundi, he's the CEO of Agnico Eagle Mines, a great performer during this period. It's getting increasingly hard and expensive to find precious metals. The world's barely replacing this ancient store hold of value and only about 1% of the entire worth of gold is found each year. There's true scarcity value, something crypto can't truly provide as an asset class or at least that we don't think it can. In fact, gold has become so difficult to find the most of the miners you perform poorly themselves because they're cost or too high. Of the majors, the only one that's deliberately consistently is Agnico Eagle, and that's because they mine chiefly in their own backyard of Canada, where costs are under control and there are far fewer mistakes made than their compadres. The stock's a double the price of gold this year. Meanwhile, we aren't sure of any crypto despite what the apostles say on television or in their myriad ads. For example, we show this price of Solana, crypto coin every day, but does anyone even know anything about it? There's no clamor for a Solana ETF. It's just out there getting promoted by who knows who or why. But gold, it's a beloved metal, something we can see by how Costco sells out of its members-only gold bars every day before most customers can get them. Unlike crypto, gold is something you can physically take with you on the run from an unstable regime. There's value everywhere around the globe. No questions asked. Now, perhaps somewhat ironically, I believe in both gold and crypto, but for wildly different reasons. I like crypto because as a constituency, they're always taking up after decline. I don't think it's gonna stop anytime soon. I be a bar of Ethereum and a Bitcoin down here for one simple reason, one simple imperative. Our budget deficit is out of control, so countless people will buy crypto currencies as alternatives to the dollar, because they imagine a future of rampant inflation. These people don't have the heft to influence the bond market, but they can definitely take up Ethereum and Bitcoin. Maybe one day crypto will be a genuine hedge against inflation, for now though, it's simply too young to act as a hedge against anything. We don't know how the supply of these coins works. We don't know if they can be trusted, but I'm confident it will work over time. It just needs more seasoning. And that's why I say buy gold and buy Bitcoin. You need as many hedges as you can get here. They can't all work at once, but I bet over time they'll all work out well. I'd like to say there's always a more market somewhere, and I'd probably try to find it just for you right here, oh, man, buddy, I'm Jim Kramer. See you tomorrow. (upbeat music) All opinions expressed by Jim Kramer on this podcast are solely Kramer's opinions, and do not reflect the opinions of CNBC, NBC, Universal, 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 Kramer 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. (upbeat music) Join Finteract, a peer-to-peer community of financial services professionals, and keep your finger on the pulse of the industry. Finteract offers a digital hub to start conversations, connect with fresh perspectives, and problem-solve with peers. This member's only community also provides access to virtual and in-person events, where you can chat tech stack, develop efficiencies, and learn new ways to propel your business forward. Apply at finteract.net. (upbeat music)