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 7/29/24
Trading S.H.W.B. 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. Take your business further with a smart and flexible American Express Business Gold Card. It offers flexible spending capacity that adapts to your business. You can also earn up to $395 in annual statement credits on eligible purchases at Select Business Merchants. That's the powerful backing of American Express. In terms of supply, learn more at AmericanExpress.com/businessgoldcard. My mission is simple, to make you money. I'm here to level the playing field for all investors. There's always a more market somewhere, and I promise to help you find it. May have money starts now. Hey, I'm Kramer. Welcome to May have money. Welcome to Kramer. I'll be with my friends. I'm just trying to help me make some money. My job is not just to entertain, but to educate, teach, call me, 1-800-743-CBC, tweet me at Jim Kramer. This market is not experiencing a small cap rally. It's experiencing a rally and everything else but detect guidance. Making caps have become what we call shared donors for virtually every other stock in the market. It's not a rotation at all. It's a great broadening, and we often embrace it as bullish, not bearish, except for the big cap tax that we put this week, which are stalling out daily and seem to just run into selling every day at the close. So the day when the Dow ended down for 9 points, that's a big game point, 0.08% and that's a gross point, 0.07%. I say we celebrate the markets good. I want to put some examples in your face so you know we aren't being led solely by a bunch of small cap companies that aren't and are doing well. She made it that small cap companies are really bad stocks and bad companies, and the stocks are only being bought as part of a larger basket like the Russell 2000, the SB small cap 600 or even the SB mid cap 400, which I know sounds like our NASCAR race, but it represents the most undervalued part of the economy. The biggest institutions don't have the time to examine all these different small cap stocks, they just treat the Russell 2000 move into the SB 500 and they buy the index itself as an entity because it is still historically cheap, even after this rally. That's the broadening. Okay, so the board is real trash is while some treasure. The treasure being companies that do better when interest rates go down, like when the Fed starts cutting, the tech titans so rich don't need the public debt markets to prosper, so they don't get much benefit from lower rates. That's not the case with the small cap, so you can see what people would sell the tech titans that are already up huge for the year and cycle into cheaper small cap stocks as a group, even if many of them are just plain awful. When you buy an index, you always got to go to bed. But you know what? It's not just the Russell 2000, which by the way I'm tired of hearing about. So I say this, let's look at some individual stocks that have tackled billions of dollars in market capitalization as part of the great broadening that is the last much more permissive than anything we've seen in ages. So you know that this is not just some sort of small cap, Rob, even though that's what you keep hearing every day. It's wrong. Take McDonald's. Now this stock has gotten no love. It's seen as a loser because this meal's cost too much. The gold marches has fallen from 302 to 243, and it's losing a few weeks. It's a total. So this morning, when McDonald's, a hundred eighty billion dollar company, not small cap reported disappointing, same for sales down one instead of up point eight, four percent. The substantial sales miss, 10 cent earnings miss over 307 basis. I saw the numbers. I said to everybody in the room, all right, this one's going to soar. I mean, everyone looked at me like, well, what is he talking about? But sure enough, McDonald's jumped nearly four percent today. So there's no doubt that when Wall Street was still in love with magnificent seven, stock like McDonald's would have been pelted into submission after reporting such digital numbers. But the market's falling out of love with seven. In fact, nobody was truly disappointed by McDonald's because everyone expected them to have bad numbers. I mean, give me a break. In fact, McDonald's was kicking at a plan to return to growth, including five dollar value meals was enough to get everyone excited about this one. Hey, you know what, we saw the same thing on Friday with the 69 billion dollar 3M in the 99 billion dollar, but some miles important on Friday. Both had a ton of good things to say. Now, Bill Brown, the new CEO of 3M spent most of his com school actually talking about how he sees many areas where costs could be cut. He saw multiple segments that could grow faster. So it took for the stock to rally 23% when you expected 3M and got it a takeover bid. I say that's just playing catch up as part of the great broadening, although Bill is an inspiring fella. Bristol Myers did raise the raise of his four-year earnings forecast, pretty substantial, which is a huge positive. The company also earned $2.07 per share. She was only looking for $1.62. Everyone had given up on this one. That puts some news on a hopeful slew of new drugs, got the stock going more than 11%. That's a loss in 20 years. A broadening needs, Bristol Myers, it can't just rely in the ceiling. What happened to Bristol is that after years of repeatedly missing the estimates, the new CEO came in and now they're knocking it out of the park, not unlike 3M with the new CEO. Of course, it's not just these big caps. We're seeing a remarkable run that here before just like smaller semiconductor stocks. If you take one look at the SMA, semiconductor index, you'll see a wholesale redistribution from the once loved Nvidia to everything else. Take this one. Good morning. On semiconductor reporting, we've gotten used to it missing the numbers. It's kind of like an old shoe missing numbers at this point, but not this time. It beat the estimates. Earning 96 cents versus 92, wow, and it rallied over 11%. CEO, Hase no Corey, had a lot of good things to say. I'm going to quote him. We are seeing some stabilization in demand in our core markets, he told us. He went on, "We expect parts of industrial such as energy infrastructure recovered in the second half." Not only that, he says that China's recovering in both industrial and auto. Boy, that got some big orders from BW bands too. Nvidia made me the stock that keeps on giving market cap before President Trump keeps antagonizing Taiwan and demanding the geopolitical equivalent of protection money. All of the video strips are made in Taiwan for everyone's sake. The stock's been not been able to rally ever since former President Trump made that statement out of Taiwan in the market sure makes sense as more, well, as long as it's more bite-sized, like that one, a sky works, a core vote. Sure, the rest of the 2000s talked about endlessly, but have you seen the S&P mid cap 400 since the month began? That's me making an auto sound, super funny, laughing on the inside. What's leading the charge? Three of the top 10 stocks are banks. Wow. Hey, they've all experienced rallies and tremendous proportions. Like, take first financial bank shares of Abilene, Texas. That's number one. On July 10, the stock's at 29, that was at 38, nothing happened. How about number two? You may not know South State down in Columbia, South Carolina, but this quiet regional powerhouse has seen its stock go from 75 to 98. Third, Tacoma's own Columbia banking system. The system stopped was at 19 back in July 10, now it's at 26. Every one of these views are what you'd expect from a takeover bid if you didn't know better. Here's something that makes sense. There are three home builders on the top 10 lists. KB Home, Toll Brothers, Taylor Morrison. When interest rates go down, these stocks sort even if there are no near-term number surprises. Number eight, one of my favs, Fortune Brand's Innovations, a fabulous company that you've had on, which makes all sorts of high-end fixtures for housing, and it puts out great numbers on Friday. That's exactly what should happen right now on the business cycle. It's fitting. It's fitting. They're all mortgage or home equity plays. Of course, that's kind of the issue with the move. It's so fitting and it's almost by road. We now love those now new unharled stocks. We hate the old tried and true fabulous companies. Money's coming out of what has been running for a long time and going into cheap stocks that companies have been at for lower rates. Does Microsoft which reports tomorrow really gain or lose from rates? Not at all. It doesn't need to borrow any money. How about matter which reports and ways they immune from rates? And then Thursday, the day of days, Apple and Amazon have nothing much to do with rates at all. Even as both their products have cost consumers a lot of money. Maybe these stocks can advance, but the bar sets so high it will be hard for them to excite or enthuse when we are at the beginning of a rate-cut cycle. So the bottom line, I guess you're supposed to sell companies that have nothing to do with rates and buy stocks that can benefit from lower rates? That's the great broadening trade people and when you put it in that proper context, you know it's got some staying power, at least in the small medium size, catch up to the magnificent seven. Although if that's what's needed, an awful lot of points will have to be transferred from the seven to the small fry to complete this rotation. I want to start with Dave in California. Dave? I've been at a club network for almost a year now and I've been learning a lot. And in light of your terrific interview with the Commerce Secretary last week and their future technology plans, she mentioned Texas Instruments and sort of said they had a good relationship with Texas Instruments and is this a good time to restart a position? Yes it is and I'll tell you why. Just like on semi reporting good numbers and texting different protocol numbers, you have an activist in their Elliot partners that can make a lot of things happen. By the way, they're in Starbucks and I think they can make a lot of things happen there and in Southwest Texas Instruments is a great story company, two and a half percent yield and I think they're going to have a very big meeting that's going to tell you a lay out the strategy and the stocks will go up well in advance of that. I'm going to go to Robert in New York, Robert. Jim Bo, Jim Bo, I missed talking to you, it's been about two weeks and I've got to tell you Jim, you're amazing. Tomorrow's my birthday, last time I sang Happy Birthday to you, if you remember. I enjoyed that. I know, I know you did, it was pretty cool. Hey, you know, well, I mean if you like to reviews yourself, absolutely. Well Jim, I've got to tell you, it's been one year that I've been speaking to you and it's been a thrill of a lifetime to call into your show because you have made me so much money in the one year is my birthday. Well there you go, happy birthday and I love that, she I love that. Happy birthday to me, happy birthday to me, thank God for Jim Kramer, he's made me tons of money. Well don't quit your day job partner, but I like that, I like the whole theme, I like the theme of it and I'm going to run down to play that and continue to swoop to my wife Lisa until she starts realizing that I'm a good guy. Well, Jim, you're not a good guy, you're a great guy, but let's get on with it. You know, just a second, let me get on the phone, that's what, you know, that was a mistake. You can't get on with it, all of TV rules just then and you, you won't see me for the next 40 years. Tell me what's going on. Jim, I love you Jim, this stock has really done well in the last number of months driven by the company's strategic initiatives and market conditions, especially in its investment banking sector. Their wealth management sector has been increasing also. I would think that if the Fed cuts raise, this stock will go much higher, Morgan Stanley. I agree with you, I agree with you on every reason that call, frankly, I mean, let me tell you, Morgan Stanley, when we do pieces about these big IPO's and we get a lot of takeovers, you're going to see Morgan Stanley go higher and higher and higher and I want to thank Robert New York and Dave in California, they bring it, they bring it every time they call. Clevverine, this is the great broadening trade people, so that's a big cap in the small cap. Get that out of your head, look, this is when you sell, you donate great points from the big guys to the little guys and you know what? I think you're going to have something with great staying power because of that. Well, man, money tonight, potato company Lamb Weston has been getting fried. So is there any hope for the stock becoming a hot potato? I'm running through the latest. Then last week we got the largest IPO of the year, Lidius. And the market seemed to like it, but where do I come down? We're going to be my thesis on the newly minted stock and Clevverine's course was just about flat in the last year. So what is going to take from the outdoor apparel company to finally break out? I'm seeing where things stand with the CEO, so stay with Cramer. Don't miss a second of Mad Money, follow @chimcramer on X. Have a question? Tweet Cramer. #MadMensions. Send Jim an email to madmoney@cnbc.com or give us a call at 1-800-743-cnbc. And if something, head to madmoney.cnbc.com. Schwab Trading is now powered by Ameritrade. To give you a new, elevated trading experience, Taylor made for trader minds. Go deeper with think or swim. The powerful award-winning trading platforms, now at Schwab. Unlock support from the Trade Desk are a team of passionate traders who live in brief trading like you do. And sharpen your skills with an expanding library of online education crafted just for traders. All designed to help you trade brilliantly. Learn more at Schwab.com/trading. When you're hiring, the best way to search for a candidate isn't to search at all. Don't search. Match. With Indeed. Indeed is your matching and hiring platform with over 350 million global monthly visitors according to Indeed data and a matching engine that helps you find quality candidates fast. Use Indeed for scheduling, screening and messaging to connect with candidates faster. Thus, 93% of employers agree Indeed delivers the highest quality matches compared to other job sites according to a recent Indeed survey. Leveraging over 140 million qualifications and preferences every day, Indeed's matching engine is constantly learning from your preferences. Join more than 3.5 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. Last week, the stock of lamb western blew up. This company has supplied frozen potato products to restaurants and retailers, so it's stock full more than 28% on Wednesday in response to a truly heinous quarter, where this is their second implosion in a row. When lamb western poured in April, it's stock fell nearly 20% in a single session. At this point, the stock is down 48% for the year. Making this purveyor french fries, the third worst performed in the SB500 in 2024, a striking decline for what used to be considered one of the premier package food companies. For the other issues, lamb western has been a leader in the frozen potato industry for more than 70 years. Now, these aren't frozen and they really stink, but that's okay. Until 2016, it was a division of Conaugra. But since the spinoff has done very, very well. From late 2016, through its peak last year, the stock rallied nearly 300%. But now, suddenly, it's become one of the worst stocks in the market. That was easy. Now, it looks like a smarter company to be thought about the spinoff. Without the climb, we got asked, "What the heck is going on?" Technically, the trouble started with lamb western poured a year ago, July of '23. Well, there was nothing really wrong with the numbers. The stock didn't seem to care. In fact, it kept sliding for the following months, called it late July to mid-October '23. It's part of the broader beatdown in the food stocks created by the initial GLP-S1 scare. Now, those weight loss drugs, that first move is, as everyone was terrified of new weight loss drugs, they can create, they'll reduce craving for junk food, and it brought down practically everything. I mean, it can even do this. It can make it so you don't want these. It was it. It was indiscriminate. But at least when it comes to lamb western, the rise of GLP just once changed the whole narrative. Before, frankly, the thesis for lamb western was pretty simple. People allowed french fries and tater tots and other potato products. So the company keep growing nicely as it expanded into different channels and markets around the world. But after the last fall, we've had to reconsider whether that story still works in a GLP-S1 world. Because junk food, well, let's say almost all the companies that make junk food are guilty until proven innocent these days. At first, lamb western didn't seem to look at a problem. They reported very good quarters in October and January. Things weren't really going fine by the story until suddenly, they were... The trouble started in April when lamb western reported a shockingly bad set of numbers. In fact, it was a very bad combination of huge revenue and earnings miss. Ugh, net sales came in at $1.46 billion, Wall Street wanted $1.65 billion. The earnings shrank by 18% falling to $1.20 per share, and it was looking for $1.45. Worst management cut their full year guidance across the board, and it was in the most embarrassing way. See, in January lamb western raises full year, these forecasts, and April, they repealed that entire boost, and then some. It sure did make management seem really clueless. Of course, in April lamb western had a legitimate excuse for the sudden, the verse of fortune. In fact, they gave you a couple of reasons for the weakest at that time. But investors only paid attention to one of them, and that's the company's transition to a new enterprise resource planning system, ERP system, in North America. Now, see, when you make a change in resource planning, it goes poorly. The consequence can be pretty dire. I don't blame anyone for focusing solely on that issue in April, because that's exactly what lamb western's management did on the call. At the time, even though the stock got crushed, there wasn't a widespread sense that anything else was wrong. A lot of folks assume this was a one-off problem that can easily be overcome, because remember, this stock had been a total home run for a long time. But if you rather put a bit more closely in April, you would have found some clues to something else was afoot, specifically the management cut there for your forecast. They alluded to, and I quote, "soft near-term restaurant traffic and retail trends in North America and other key international markets." End quote. I don't know. To me, it's not a pre-series. Remember, this spring was when we started to hear rumblings about softness in certain lower-income corners of the consumer's base, but pretty much everybody assumed lamb western's problems were on the resource planning side, rather than slowing end markets like McDonald's, where they happened to be a supplier to McDonald's. I mean, it's just potatoes for heaven's sake, right? Fast forward to last Wednesday, and we realized the truth. This time, the companies had sales to climb by 5%. That's a major shortfall, and the earnings were worse down 40% year over year. Coming in at 78 cents per share, you know what, Wall Street was looking for? $1.26. The House of Pay. This was the final quarter of the fiscal year, too, and lamb western's four-year earnings still came in lower than their already lower guidance from April. That's the target. Management issued a very pessimistic forecast for their new fiscal year. Talking about $4.00 and $3.00 and $4.00 and 85 cents, the street was looking for $6.10. Man, that's a big miss. This time, there was very little talking about enterprise resource planning. CEO Tom Warner didn't beat around the bush saying, quote, "Our price/mix results were below our expectations, while market share losses in a slowdown in restaurant traffic in the U.S., and many of our key international markets were greater than we expected. We also incurred losses related to a voluntary product withdrawal." Man, that's nasty. Now looking forward, Warner warned that, and I quote, "We expect fiscal 2025 to be another challenging year. The operating environment has changed rapidly over the past 12 months as global restaurant traffic and frozen potato demand soften due to menu price inflation continuing to negatively affect restaurant traffic," end quote. Many of us want to say, quote, "This has resulted in an increase in available capacity in North America and Europe. We believe this supply to man in balance will persist through much, if not all, of fiscal year 2025." End quote. It's a good old fashioned potato glut, the opposite of the great famine of 1848. But maybe we should have seen this coming, this is exactly what we've been hearing from the restaurants themselves, the customers, the ones that raised prices to aggressively over the past few years are losing traffic. And the customers who do come in might not be ordering as many things, including fries. I can't believe that because the fries are so good, but it does happen. That means Lamb West either needs to compromise on price or lose this business entirely. Compromise on price means estimate cuts. Still, after this man with the client, do we think the stocks will also cause? I'm not ready to go there. No. I think you need to be careful for the next quarter, maybe even the next year, but I think they do risk this thing. I smell an opportunity, not those fries, they stink. With this huge pullback, again, this stock's been cut in half forever to say. And now it says for 12.5 times this year's earnings estimates, even if Lamb West disappoints by about $0.50 per share, and you assume it deserves to trade it at 20% discount to its historical valuation, that would still make it $80 stock. That's up more than 40% for its Carly trading. Also, remember by the time we get to the next spring, the company will start lapping these easier quarters, and we heard from McDonald's are going to keep the things down, right? Keep the prices down. A little more customers are going to come back. Honestly, my real concern is still that impact of the GOP just once on all things starch. Maybe it's a consequence of these drugs. The whole quick serve restaurant space will be in big trouble. That said, I don't think we're there yet. Right now, it's the consumer pushback against higher prices is crushing this industry. I don't have people in those drugs, at least I get. The bottom line, I'd be a buyer of Lamb West and into this extreme weight this. Now, I know that's very contrary, so you want to buy slowly because things could get a whole lot worse for you to get better, though, remember McDonald's stock was up today. What matters, over time though, I'm betting it's a great potato glut will come to an end, and Lamb Westin will be just fine. Man, money is back after the break. Coming up, a warehouse player of noble descent, Don't Miss Kramer's take on the market's latest IPO. Next. Trading Ashwab 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. With 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. You might have missed it during the extreme action, but we got a ton of activity from the IPO market last week. Four separate companies raising over $100 million, according to Renaissance Capital, the leading IPO research firm. This is the first time that's happened all year. In fact, we got the largest deal of 2024 last week, Lydia, it's a real estate investment trust that operates the world's number one network of cold storage warehouses. It raised more than $4.4 billion. The deal price is $78, it's down to $86 stock, and you can get in on it. There was a lot of stock for sale. Given the scale of this one, I think we should take a closer look at it. Lydia's is basically a cold storage roll up. They add different businesses together. Back in 2008, a couple of former Morgan Stanley investment bankers, Smart Fellows bought their first cold storage facility in Seattle, and since then they made 116 acquisitions in order to become the largest player in the industry, 482 warehouses, containing 3 billion cubic feet of capacity. These guys control third of the cold storage market in northern America. The closest is better only as 19% good business. Lydia's operates these temperature control warehouses, and they also provide their customers with supply chain services. They're an essential link in the food chain, which is why their customers include some of the largest restaurants and consumer packaged goods companies on earth. We're talking seafood, poultry, packed foods, dairy, pork, produce, baked goods, and beef, basically anything that needs to be frozen or refrigerated gets in one of their places. The other day, this is a pretty standard roll up story. The expert used daily backers who created Lydia's, found a very fragmented industry, in this case cold storage, and used a bunch of back positions to build a dominant player in a very short span of time. Now that Lydia's is the top dog, it can offer more comprehensive services than its smaller competitor. Scale is a wonderful thing. These are also argues that their industry is uniquely levered to the rise in online food sales. Hey, let's say you're ordering frozen steaks off the internet like I do, somebody needs a refrigerated warehouse to store the stuff in. Lydia's also benefits from a younger generation that's obsessed with healthy eating, because they want more fresh foods with less preservatives. Again, what do you need? Cold storage. Lydia's also mentions that they've invested more than $1 billion over the past five years from technology initiatives. Big move to the cloud, something that management says can help them win business operate more efficiently. I think they're probably right. But I hesitate to play up the tech angle because it's a warehouse company. Now let's talk numbers. Lydia's has grown in sales in $3.7 billion in 2021 to $5.34 billion last year. In terms of profitability, internet operating income grew from $1.13, $1.13 billion, excuse me, in 2021 to $1.75 billion last year, adjusted funds for operations. This is the key metric for REITs, came in at $4.66 million in 2021 for jumping to $845 million last year. That said, in the first quarter of this year, the latest set of numbers we have, Lydia's growth slowed dramatically, quizzical, even disappeared. Revenue is down 0.4% and on that operating income was up just 0.1% and adjusted funds from operations increased by 20.4, which is good, but not compared to 53% growth last year. So we need to ask ourselves if this is a new normal after previous years when Lydia's got a big boost to its growth. Thanks to the steady stream of acquisitions, this is a very important question. I don't have the answer. Beyond that, my one big concern about Lydia's is that all the debt deal making over the past decade, and actually it's been a decade and a half, has left them with a substantial debt load. As of the end of March, the company had $9.25 billion of net long-term debt. So stamps are more than the roughly $5 billion of stockholder equity at the time. Their net debt long-term debt was seven times last year's adjusted earnings for interest taxes, appreciation, and amortization. And that's a very high ratio, not what I want to see. Because Lydia's debt is so high. They plan to spend pretty much all of $4.4 billion they raise in the IPO on cleaning up the balance sheet. Of course, the perfect one you'd like to see them use these proceeds to grow the business, but at least they're taking a major risk off the table, the one I'm most worried about. Finally, given that this is a real estate investment trust, let's talk potential dividends. Lydia says that long-term intents distribute roughly half of its funds from operations to shareholders. Considering what they made last year, it would have worked out to $1.73 per share dividend in 2023. With the stock at $86, it represents about 2% yield, not great. Of course, the funds from operations grew by 20% in the first quarter, but I think the share account figure in the perspective might end up being a low-ball number. So a 2% yield sounds about right to me, not what I want, but it's got some growth. So if you like the cold storage business, what should you be willing to pay for Lineage? That will give us some clear comparisons here. The second largest player in cold storage is a miracle, which is also a publicly traded reap. A miracle sells for 20x this year's funds from operations estimate, with a 3% yield. If we assume that its 20% funds from operations' growth continues for the full year, Lineage is a touch more expensive at 21x this year's at numbers, although I expect the dividend to be lower. If you look at other logistics rates, I'd be like prologists, they're a long time, right? Trades at 22.8x this year's funds from operations with a 3.1% yield. Long story short, the valuation seems reasonable. While I don't want to pound the table on this one, I say, I'm honestly positive here. I'd like to see more details before giving a whole horde an endorsement. Got to know where the future of growth will be coming from after that last quarter and what the dividend will actually look like, because that's why people buy these stocks. But with the information that we have now, I think there's plenty to like about Lineage. My biggest concern was that balance sheet, but that's less of a concern after the company used most of the proceeds from this deal to pay down debt. The valuation-wide stocks seem to be right where it should be, which is nice to see. If there's so many IPOs from the past five years, just zoomed immediately to rational levels. Bottom line, now you know what you need to know about the year's largest IPO, Lineage Inc. I hope to be able to do more of these Know Your IPO segments as more companies come public that are worth talking about. Although August is usually slow in the deal front, we might see another wave of IPOs in the fall. Who knows? It's a pretty positive market right now. Let's take calls. Bob in New York, Bob. Hey, Jim, how you doing? I'm doing well, Bob. How are you? We're hanging in there, buddy. Hey, Jim. Starwood announced their dividend for the next two quarters. That's something I've never heard about before. And secondly, what do you think of Stern like? Is he still scaring you away from Starwood? Well, I mean, look, the problem with the CEO who, even though he may have declared the dividend twice, is that if he scares me, I'm not on board because everybody else could bring him down even if he's doing well. And that's why I said, you know what, I used to endorse this thing for many years, but it's done absolutely nothing. So it's not going to miss anything. You get the dividend, but I want more than a dividend by stocks and if I want to get a high yielding dividend, if I want a big dividend, I'll just go buy a bond. I don't need that extra risk from being in an industry that this man, Barry Stern like tells me is not doing well. Let's go to Hunter in Arizona, Hunter. Happy Monday, Mr. Kramer. Oh, you bet. How about you, Hunter? What's happening? Tell us the asset work discord. I want to know what you think about MPW and adding it to a long term. I think that you know, no, I think that yield is too high. That's a red flag. I wouldn't touch that thing. Please don't touch it. Let's go to Jeff in Connecticut. Jeff. Yeah, Jim, long time listener, first time caller. Your show is great. Excellent. Thank you. I own a stock. It's listed in the home builders industry, but it doesn't really build homes. They buy the land, do all the prep and then sell it to the home builders. It's a four star FOR looks pretty. Well I don't know four star. I'm going to have to do some work and come back. I think that's kind of an interesting idea to find a residential real estate play like that. But I really, you know, I know Tolle, I know Lenore, I know Horton, I know Polte, and I like all those, but I do not know four star and I've got to do some work. All right, look, I don't want to pound the table yet on lineage, but I do think there's a lot to like here. Valuation wise, the stock seems to be kind of where it should be. That's refreshing to see, isn't it? Now, much more may of mine, including my Switzerland Columbia Sportswear, but the stock would be hard today, are best you're signaling that Apparel company's recent mix quarter is now behind it, I'm trying on the story, for size, with the company's CEO. Then on Friday, Jory ordered Abbott to pay $4.95 million related to premature industry formula. I'm breaking down the verdict in what it could mean for the entire industry. No wonder it calls rapid fire tonight, so there's the lightning round, so stay with Cramer. What's happening at Columbia Sportswear, the outdoor focused Apparel and footwear company with big brands like Columbia, Sorrel, Prana, and Mountain Hardware? Last week, the company reported better than fear of quarter, although management did cut their operating income guidance in response to stock drop 1% on Friday, although we've had them more than 3% today. So is today's action telling us that the Apparel and negative risk bank did? Let's check in with Tim Borres, the chairman, president, and CEO of Columbia Sportswear, who get a better sense of the quarter, and where's head, Mr. Borres, welcome back to Mad Money. Jim, thanks for inviting us here. Well, I got to tell you, Tim, this was the quarter that I'm so fearful of hopping around all the world, which is that we're the slow ones, that suddenly I know we're made because it's political, maybe because of problems we don't know with inflation, but it looks like that our country is no longer as good a retail environment as some of your other areas. Well, you know, this is a little bit unusual, one, as you mentioned, but secondarily for our company, this is always the smallest quarter of the year. So any particular issue can get modified and accelerated. So, you know, we're still bullish on the business, obviously, and the US is, you know, a great place to live, and the reason our company does so well is because consumers around the world recognize America, and especially the American West. So things always get a little turbulent when there's an election going on, and we just were great that we have places in the world that are more robust than here. Including, it sounds like China, where most people are seeing a definitive slowdown, particularly on sports and apparel. Well, you have to remember, and we've been quite open about the fact that we underperformed in China for a period of time, we've got a great team there, so we're coming out of it and we're growing, and we've got a really good team there that really understands the market, and so there's lots of opportunity for us there. We think that'll be our largest growing market at some point in time, but yeah, we've just reinvigorated the brand. Well, you continue to innovate, and I am particularly interested in what I will just call polar bear technology. I was at this football game. It was the Chiefs versus the Dolphins. It was minus nine. I was going crazy. Would this keep me warm? Absolutely, you know, that's biomimicry. So our team here put together an analysis of polar bears, which as you remember, the fur of a polar bear is actually translucent. So the sun goes through the translucent, hits the black skin of a polar bear, which heats up, and then the fur keeps it insulated and keeps the heat in, so we've got a couple of different technologies around that biomimicry, and believe me, this is going to be a real interesting product for us, and a great story and good opportunity for us to tell consumers more about our innovations. And will that be directing consumer will be everywhere? I mean, while I see that in prestige department stores, it'll be in more of outdoor wear. I see what's the biggest representation is going to be on Columbia.com, where we can really control it, but we have many other customers that are buying it, and it'll be available globally. I think it's very exciting. I hope you have the scale to pull that one off, because no one's had new technology other than like a battery in your jacket, which is okay. I want what you gave me. Now Prana, once again, very tough, but it looks like the rest of the industry is slowing down. Is this your turn to shine? Maybe you can do something a little different from the other guys? Well, you know, we've been, again, very open when we've been underperforming. We've made changes at Prana with the leadership there. We're very excited about the new opportunities there, and similar with Sorrel, where we just got ourselves in a position, and frankly, this is a small quarter for Sorrel, very small. But we're going to turn those businesses around, and we're well on our way. So we're very excited about the opportunity, and it's going to be good. We've really spent the last year managing our excess inventories and focusing on profitably liquidating that stuff, and now it's time to turn our attention to growing the business again across all of our brands. Okay, now we do have a lot of products here, including a product that is very soft on the outside. I kind of like it. It feels really cool. It reminds me of like a Colorado thing, made in Vietnam titanium, which I see in the upright end corner. Now, is that something that we'll be buying in the fall? The titanium products are our best products, and we have a quite broad selection of titanium products across sportswear, outerwear, and footwear. And this is a really good opportunity for us to put together our best technologies and our best thoughts about how to keep warm or cool, and yeah, we'll have lots of it available for this coming year. Anything new with performance fishing, PFG, I took it, I went on a fishing trip with my kids. Everyone was jealous because the sun was really bright, and I'm the only one that didn't get completely fried. Well, you know, what's interesting is we are going to be using and available for Spring 25, a great product which we call Sun Deflector. So if you remember the reflective product that we have on the inside of our garments, we've designed a ceramic rendition of that called Sun Deflector, which means the sun will hit that fabric and bounce off and won't create heat and also keep cool. But that's going to be heart and parcel of the next lunar lander, which is going to take off sometime in mid-December, early January, and that's going to be connected with the technologies of Omni Heat Infinity, which was on the first lander. So we're going to have two Columbia technologies on the next lunar lander launch, and we're very excited about how we can promote those and make sure people understand how important they are for not only keeping people comfortable, but keeping a technology lunar lander in good health. That's very cool. I've got to tell you, I love your stuff. Everybody does because it's always something new technology. I hope Sirella is a good season. We know that is really crucial to the quarter, but I think it's the technology that's crucial to the company and you always deliver. And thank you so much for coming on. I hope America picks up when we get to the important quarters, not this quarter. Absolutely. Thanks, Jim. I appreciate it very much. Of course, Tim. That's Tim Boyle, Chairman, President CEO of Columbia Sportswear. You see this stuff. You know this stuff. I wear all this stuff. I don't know about you. Maybe mine is back yet to the break. Coming up, pop open those umbrellas and tee up your toughest questions. Kramer takes on all comers in the lightning round. And then the lightning round is over. Are you ready, Steve? Jim, you're happy to do your two years. Oh, man, what's happening? With the recent pullback in Bank of America and women would be a good entry point. Right here. You buy some right here. You buy some maybe with breaks 40. I think this company is selling very inexpensively and it's a good one. Let's go to Indiana, and...and hello? Yeah. Hey, Jim, what's going on? Go ahead. Look, I just feel like an idiot. Constellation energy. Buy more. Hold it. Look, this is a solar play that is a very good company. It's up a huge amount versus a lot of other stocks. It's up 47 percent still for the year. I think you buy some. Please hold on to it. Do not sell it. Let's go to Peter, New Jersey. Peter! Hey, Jim. Good afternoon. I'm sitting out here in my New Jersey flower garden. We didn't tell to the man. Thanks for taking my call. Of course. Here's my question, there's two parts. I have a better year and a half to year time horizon. My question is on your end, what do you think roughly is the outlook over that period? Okay, so I think the problem with meta right now is it's going up so much that people are just selling meta to buy a lot of stuff in the small and medium-sized range. And I don't think that's going to change no matter what Mark Zuckerberg says, so just be aware that the stocks in the dog house right now and it could come out of it only if it gets even cheaper. Let's go to Vinay in Iowa, Vinay. Boy, Jim, Vinay. Boy, yeah. Call it to my alum. Excellent. Long time listener for Suncaller. Okay. Your thoughts on I-C-I-C-I bank. I-B-N. Okay, I think if you want exposure, indeed, I think it's a great way to get that exposure. And I wouldn't think that that. I think I'm about to be better than just buying a whole basket. I like that idea. Let's go to Scott in California, Scott. Jim, I've got to say thank you for sharing your opinions with all the experience you have in the market for so many years now. Oh, thank you. Thank you very much. Do my best. Hey, so I called you a little over a year ago about a little pharma company that spun off of Merck. And at that time you weren't too warm and fuzzy about that segment in the market but the whole farm has been off. Right. It's been a little while now and I go since December, they've actually come off bottom that looks like and they've been steadily going up. They've got a solid dividend track record and they're profitable and they're going for less than six percent earnings or six times earnings. Am I missing something here or what's going on with O-Q-I-M? Do you want some stuff? Oh, Oregon idea. Well, look, I missed it. I mean Pfizer, Oregon, these are companies that are just kind of widely going higher and I have to admit that one's probably not done and that, ladies of the lightning round. The lightning round is sponsored by Charles Schwab. Coming up, the verdict is in on Abbott Labs but Kramer isn't done with his closing arguments. Next. I knew Abbott Labs was some trouble from the moment I saw that their first specialized baby formula lawsuit against them would take place in St. Louis, Missouri, possibly the most pro-Plaintive venue in America, but he didn't have the extent of the damage. Well, after Friday's jury verdict awarding the plane of 95 million in commensory damage and 400 million in punitive damages was a lot worse than I thought. Honestly, this verse is an outrage. Abbott Labs makes a special baby formula that the request of pediatricians and their families something the American Academy of Pediatrics strongly favors. The Academy says the formula is essential to fighting the effects of necrotizing enterocolitis. That's a serious condition that can be lethal to pre-terming infants. It's a condition that the planet's lawyers contain the abbot is causing to this formula. These special appointments are often the last line of defense for doctors when a premature baby doesn't have enough mother's milk. If they can't get enough milk from the mother, hospitals turn to donated human milk. If there isn't enough human milk donation, there often isn't, then doctors turn to special formulas made by Abbott Labs and Ricki Benkieser. Pretty much the whole medical profession requires a specialized formula as a routine and necessary part of care for babies who are born prematurely. They're the ones who use it. Yet lawyers for the planets and St. Louis argue that successfully that Abbott specialized forming not only cause necrotizing enterocolitis, it also did so with no warning, hence the $495 million burning. Practically, I'm going to ask for words about this one. The Wall Street Journal opinion page quoted a shakedown I couldn't even want. You understand. Abbott only makes this formula because it's the right thing to do. The product only makes it $9 million a year. As CEO Robert Ford told me on Squawk on the street, quote, "If this product would no longer available, there would be a public health crisis," end quote. Well, guess what? With this kind of verdict, Abbott would have to be insane not to pull the specialized baby formula. They can't afford to continue making it. Same goes for competitor Ricki Benkieser, which recently lost a similar lawsuit that would cost them $16 million. The real issue here, of course, is that our justice system handles civil trials like a game of roulette. It's so capricious in arbitrary that Abbott's now being held to an even higher standard than Johnson & Johnson, which made a consumer product, Johnson's talcum powder, with no warning label that cost them $2 billion a quart. Also in St. Louis, Missouri, of course. They are 22 women in their family, soon J&J, for causing ovarian cancer by failing to disclose their talc-based baby platter had asbestos in it. Even if the government never found the change, they knew about it, and J&J says there's no asbestos in talc and the powder at all. With Abbott, the $4.95 million penalty for a single person is much bigger, even though they're a special form that saves lives, and doctors recommend it and use it. It's not found in CVS or Walgreens, for everyone to say. The idea of this stuff causes that any C seems absurd. Plenty of babies get this disease even when they've lived entirely off of milk. It's just a redistribution from Abbott's coffers in the hands of the planners and the lawyers. Now Abbott may not be able to make this stuff anymore, even though every neonatal intensive care unit in America needs it. The outrageous nature of this whole experience is so stupefying that the market's locked off nearly $30 billion from Abbott's market capitalization since we started worrying about this case. And the government doesn't come to Abbott's aid, it's just watches and shrugs. It really is something off of that, how certain state juries are so friendly to the planners. It's jacked by justice. But the system we've been living with for a long time is, well, this one. I'm honestly amazed that Abbott's stock, after opening it down more than 4%, could value it within 50 cents of its last close. Perhaps that's because the stock's already down, perhaps it's because we'll also recognize it in a joke when it sees one. If this verdict is really upheld on appeal, then you could argue that it's simply not worth it for a drug company to create anything, unless you get the user's sign away to write the sue. And one thing when we're talking about a sue or product that somehow may have had asbestos in it, like what happened with J and J, but Abbott's only making this special appointment for hospitals to prevent a public health crisis. What more needs needed when it's the only alternative for doctors saying babies that have no human milk? If the feds don't lift the finger to help them, what's the point of sticking your neck out like that and making something that could wipe out the company if it keeps losing cases? As the journal says, no good deed goes unpunished, and Abbott got punished as though it was making a fortune from this formula by hiding risks that they knew about and didn't tell you. From reality, I didn't hide any of it. I very much doubt the risk and the products of money lose her anyway. But hey, that's justice in the 21st century of Merrick. Like I say, there's always more work in some way, I promise I'd find it just for you where you're in my money. I'm Drew Kramer. See you tomorrow! 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. Walmart Plus members save on meeting up with friends. Save on having them over for dinner with free delivery with no hidden fees or markups. That's groceries, plus napkins, plus that vegetable chopper to make things a bit easier. Plus, members save on gas to go meet them in their neck of the woods. Plus, when you're ready for the ultimate sign of friendship, start a show together with your included Paramount Plus subscription. Walmart Plus members save on this plus so much more. Start a 30-day free trial at walmartplus.com. Paramount+ is central plan only, separate registration required, see Walmart+ terms and conditions. [BLANK_AUDIO]