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 7/24/24
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Welcome to Man Money. Welcome to Kramer, America. I'll be with my friends. I'm just trying to help you save some money. My job is not to entertain, but to put days like today in the context. Because it is needed. So call me at 1-800-743-CBC or tweet me at your Kramer. Wall Street, it looks like it's hatted with the mega caps, doesn't it? We don't want to hear about the magnificent 70 more. Everyone thinks these stocks are going to unsustainable levels. So that they want to lock in gains and pivot to groups that have room to play catch up. Like the small caps. That's what's driving this vicious rotation we've seen over the past few weeks. Well, today we mostly experience the negative side of that move. The House of Pay. Dow Tumbling 504 points. S&P plummeting 2.31%. But the tech laid NASDAQ plunging 3.64%. All day crushed tech they once loved as they slammed the door behind them. The approximate cause of today's sell off the allegedly weak results from Alphabet, parent of Google and Tesla. I say allegedly because Alphabet actually had an excellent quarter. And while Tesla missed the earnings estimates, Elon Musk told a great story of self-driving technology, sorely needed energy production. Not to mention humanoid robots all born that later in the show. If not for the rotation out of Big Tech, I know this sounds like a stretch, but you have to understand, I think both these stocks would have been up today. Especially Alphabet, which put up phenomenal search numbers and credible results from Google Cloud with $10 billion of sales this quarter didn't think it was possible. There's some hair on the YouTube results, but that had more to do with tough comparisons versus last year with Tamu and Xi and Chinese companies flooding the streaming zone with ads last year. If you think of YouTube as the number one streaming platform, which we know Netflix talked about in its conference call, then you know the results are pretty darn good. Let's stop kidding ourselves. It's a rotation. But the stock was up 30% for the year going into the quarter. And a highly visible division seemed to outperform, seemed to. Hence today's 5% pullback and it was ugly. Similarly, Tesla got crushed down more than 12% today because it had to run so much into the quarter. And I thought everybody knew the quarter itself would be weak, though everybody did. That's not the point. It's hard to hold on to those gains after a big run from the 170s during a rotation out of Big Tech of which Tesla is most certainly now, Big Tech and not auto. So there you have it, the Chipper and the Shredder of today's market. Now even though there's a rotation going on, you may not see the Big Cat money donated to the small caps on the same day. A day of ugliness like this might spare almost nothing saving a couple of large cap healthcare stocks. You can't open like the day that started this rotation, where after a very soft June consumer price index number, the NASDAQ fell almost 2% while the Russell 2000s spoke at Big Tech jumped 3.6%. Look at that disparity, huh? The always brilliant Michael Semblis, the Chairman of Market and Investment Strategy, JPMorgan, pointed out that that day saw the single biggest outperformance by small caps in over 30 years. Talk about a bell going off. Since then, we've seen the mega caps act terribly and the small caps act better. Of course, Semblis reminds us that the small caps are a very small part of the market. They haven't performed as well as the big caps over time because frankly, they aren't as good as the big caps. Large cap tech has tripled the performance of small cap tech since December 2010, and most of those gains have come since 2019. Now during this period, we've seen great to start, let's start with some of the fine. Facebook now met Amazon, Netflix and Google, now Alphabet. And then to the magazines in 7, which changed out Netflix and added Microsoft and Nvidia and Apple. All of which have been acting really miserably. I mean, geez, Netflix, I mean, that was such a great quarter, it didn't matter. Nvidia thinks that it doesn't matter. Amazon, they could have a good quarter, it won't matter. Not in this tape, no, it won't matter at all. So get used to what happened today. Is there anything that can explain the disparity between small cap and big cap? First, small caps are much cheaper in all sorts of valuation metrics, including the all-important price during each ratio. There was a moment when Donald Trump looked like he had the election in the bag and he favors heavy tariffs pretty much everywhere, which means the estimates may be too high for the big companies that import goods and do huge business overseas. Trump has also expressed a lukewarm allegiance to some allies, including Taiwan, which you believe still are sending doctor manufacturing capabilities. So you can see how people would want to swap out of large cap tech and large cap molding nationals and swap into domestic small caps. Although now the Democrats have rallied around Vice President Harris, well, maybe that trade won't be such a slam dunk. Finally, there's a growing revulsion toward artificial intelligence and the idea that it can produce big profits after investing billions of dollars. Both Alphabet and Tesla talked about mass suspending on data centers, how much they need to do with much of that going to invidious chips. Most of the companies are in the magnatives and seminars spinning like mad on these things. And since the whole group is linked together by ETS, if you take down Tesla and you take down Alphabet- [Singing] What are you buying in the rotation? Tricky question. Last week on Squawk in the Street, I went over to some of the top 10 winners in the Russell 2000. They were mildly crew, have already extended small caps that are losing a lot of money. They didn't seem like awful things to buy. This time I'm changing things up and for our show, focusing on the 10 largest S&P 600 stocks by market cap that would be in the S&P small cap index. This is what people are going toward. These stocks have already been huge beneficiaries of the rotation, but they might have more upside because they've underperformed so badly over the years. So let's talk about playing catch up in what it means. I'm going to give you the top 10 of the larger ones. First is FabricNet, which offers an outsource manufacturing service for optical and electrical mechanical devices. Stock sales at 26 times earnings, but it's now given up the gains it made after the July 11 CPI reading in this. Some make sense. This is an outsourcing play and the whole rotation is about the end of outsource. Next is ATI, the old Allegheny technology that's the best specialty steel company on earth, including stainless and tungsten. ATI is going from 57 to 60 and it sells for 24 times earnings. Much of it still goes into aerospace. I really like it. That's a small cap you want. Third is Ensign Group. This is a company that does nursing and rehab sells at 25 times earnings. It's going from 130 to 136. This one works too. Fourth is SPS Commerce, which offers supply chain solutions. A true enterprise software plays sells for 61 times earnings you have to rally from 189 to 205. No thanks. Fifth is Mueller. I know this. I remember when it was spun off from an old steel company in the 1990s. Mueller is an old fashioned metal bender, which makes aluminum and copper forgings cheap 14 times earnings. Even though it's gone from 57 to 65, I like it a lot. Sixes Insight Enterprises works with information technology and assembled devices, including those involving AI. Trades at 20 times earnings. It's already jumped from 196 to 217. I can't play. Seventh, Maritage Homes, good old home builder that sells for nine times earnings. After seeing its stock surge from 163 to 196, move too much. I've preferred toll. Eighth is a classic industrial, SPX Tech, which specializes in heating, ventilation, air conditioning. Trades at 28 times earnings, although the stock's unchanged as the rally began, if you're getting hit hard last week. No thanks. I will take carrier. Ninth, there's installed buildings, which installs residential insulation, garage doors, showered doors, and gutters. 21 times earnings jumped from 221 to 248. I still like it. Finally, there's Comarican, considered by many to be the worst mid-size bank in the country. It sells for only 10 times earnings, supports a 5.4% yield. This stock's unchanged since the small capital began because why? You reported a very weak quarter. You don't want it. These are very representative, though, of what the S&P 600 gives you. It's what everyone says when they say they're rotating a small cap. You just got the list. I want to point out that while many have run, some were left behind, yet most of them aren't that expensive. But maybe the particulars don't matter because big institutions just sell the magnificent 7, then buy the whole S&P 600 basket. Put together by brokers, even as one of the 7 is better than any of these 10. Let me give you the bottom line here. After today, many of the MAG 7 have gotten hammered so badly that they're actually cheaper than almost all the small caps stocks. I just gave you on a price-turning basis. Then again, until we work through this brutal rotation, that newfound cheatness probably won't be enough to save the big caps. Only lower prices will accomplish that. Ouch. Mark and I will mark. Good evening, Jim. How are you today? I don't know. A little rattle to your mark. A lot of my favorite stocks got crushed today when some really lousy stocks went up. So it's kind of upsetting me. What's happening? Yeah, there were a lot of brown shoots weren't there. Yeah, that's exactly the problem. Lots of brown shoots. Why healthcare went up to, man, you are on the case mark in Iowa. How can I help you? Well, Jim, I'm seeing the story change for a company in the not well-liked EV space. They're entering into a partnership with an OEM company that will provide them with billions of dollars to further develop their EV software. Also in the deal, they will share their advanced electrical engineering expertise with that company. The partnership will lead to lower vehicle cost and faster advances. Both companies will share many technologies that will produce their own vehicles. With some time, how will this deal with VW change the Rivian story? I think it takes off the existential problem of them going under. It doesn't necessarily make the stock a great place, but I agree with you. I think Rivian, if you wanted to buy 100 shares, you can buy 50 right here and then buy 50 down $2. If in today's route, most of the magnives of this M is actually cheaper than the small cap winners that I just wrote about and told you about. But until we work through this rotation, being cheap probably won't be enough to save them for now. I'm anybody tonight, Cloud Juggernaut Salesforce and Workday are keeping up to being a new AI employees service agent to demystify the world of HR and finance. And also, I think, take on service now, frankly. I'm hearing how this new strategic partnership can be the key to the future of AI in the enterprise. Interesting. Then Thermo Fisher, TMO. Something to find growth after big years in 2020 and 2021. So what is it going to take this bird turn to its former state? I'm talking to the company's top press, feels a lot like Dan or her yesterday, doesn't it? And most of the scientific hit an all-time high before pulling back today after beating Ray's quarter, the expectation is just too high of running into the quarter. I'm going to get to the bottom with the CEO, Mando, I ever liked that story, so stay with Kramer. [Music] Don't miss a second of Mad Money. Follow @chimpcramer on X. Have a question? Tweet Kramer. #MadMensions. Send them an email to madmoney@cnbc.com or give us a call at 1-800-743-cnbc. Miss something, head to madmoney.cnbc.com 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. 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It's been a little over a year and a half since Wall Street started caring about artificial intelligence, and while we know it's potential, we're still not quite sure where we'll make its most use, which brings me to this big announcement from Salesforce and Workday this morning. This pair of enterprise software titans have teamed up to create a new AI employee service agent, which will automate time consuming tasks, provide personalized support, and give workers data-driven insights. They talked about several use cases for this employee support tool, like onboarding new workers, making changes to employee health benefits, career development actions, and many other tasks. It's over an interesting, in my opinion, this sounds like Salesforce and Workday for me, a tag team, to challenge service now, leading player in back office automation, which did report a very good number tonight. But before we try to extrapolate, let's get some more information from Mark Benioff, he's the co-founder, chairman, CEO of Salesforce, and Carl Eshabek, he's the CEO of Workday Gentlemen. Welcome back to me, I'm Mike. Great to see you, Jim, and hello from San Francisco, Salesforce Tower O'Hanna floor. Thank you for coming on the show, gentlemen. I think we should cut right to Mark, a use case for the AI employee service agent. Tell us why we need this product, what we're going to be able to do now, instead of what we used to do if we get this product. Jim, as you know, AI is all about data, and if you have access to the data, you can have phenomenal AI. If you don't have access to data, you don't get the AI. And the key to this announcement is we know that we're doing incredible AI for our customers because of the huge amount of data that Salesforce has 230 petabytes. But now we're federating completely into Workday also. So we're bringing the Workday data set and the Salesforce data set together. That makes our AI even more powerful. Why that's important is that with this new agent technology that we talked about on the last show, Jim, all of a sudden, you can have a service agent that's doing all your employee service. So all these incredible things that you can do with Workday and will do autonomously, and also this incredible new expanded data set. There's a whole new range of applications and capabilities that we could have never imagined, plus we're layering slack on top of all of that. So this is really a next step for AI, the ability to kind of bring more and more data together. And as we read these stories about co pilots and agents, maybe not being able to know what to do or how to move forward because they don't have the data. This is an example of two companies come together to make sure our customers have the data they need to deliver this incredible vision of artificial intelligence. All right, so Carl, tell me if I have service now, which says all this onboarding and I say to myself, well, I don't know these two companies that I like very much are getting together. But do I really need it? How much better is this in the current offering? I think what's most important, Jim, and you mentioned this, Mark, is we, between the two of us, we have the three most important data sets in the enterprise, the employee data, the customer data, and the financial data. And what our objective of this partnership is, is to meet our customers employees in the flow of work where they are. Now, through this new partnership and the data sharing we can do together, whether you're in slack, whether you're in workday, or whether you're actually in Salesforce, you can actually stay in those platforms and get access to each of the data sets that we have. And you don't have to no longer jump out of either Salesforce or Workday going forward. We will meet you in the workflow and we will solve answers leveraging AI, both Einstein AI and the Workday AI that is unprecedented in the market. All right, so Carl, you are a legendary investor. I mean, everyone knows both the East and West Coast that you are an amazing investor. Would you have invested in this joint venture? Well, thank you for saying that, Jim, that was a six year stint in my career where I was doing investing at the great venture capital firms to play a capital, but here today, we're focused on this partnership, an amazing partnership. I think this is a revolutionary partnership that will change the dynamic of how people leverage AI going forward. And it goes back to this. Between the two of us, the data sets we have are unmatched. And the only way to drive great outcomes with AI or generative AI is if you have a highly curated set of data. And that's what we both have. So if I were an investor, I would absolutely invest in this partnership alongside what Mark and I are doing. All right, excellent. Now, Mark, this was a big backlash today. We had Ruth poor. It was Hector last night with these questions on the alphabet call about whether all this stuff is worth it is the spend worth it. Who has really made any money on AI? Who's really been helped by it? Why is the backlash so severe? And yet you and I both know that this is the next industrial revolution. Jim, you are 100% right because I'll tell you that we are on the march right now to Dreamforce. And both of us are really excited and I'll tell you why. The theme of Dreamforce and really the power of what's happening right now in our industry and what we're really referring to is it's really humans with AI that are driving customer success together. This is a very different idea than even what was possible just a couple of years ago. You know, we've been doing predictive AI for a long time. You know, I've been using Einstein to figure out exactly what our sales forecasts are for maybe five years. And then, of course, we moved the generative AI. But now this idea of autonomous. Wow. And this idea that we have agents that are acting in our behalf. You're seeing the expansion of our human sales forces and our human service forces and really our employee bases extended through artificial intelligence and agents. That's what we talked about. For example, on the last show, the idea that we're able to kind of open up a new sales territory with a sales agent or do service deflection with a service agent, or in the example now with this federated data set. The ability for employees to get the access to the information they need through using this agent technology. This is humans with AI driving success together. That's a powerful new idea. And we have to get our head around that we're working in a whole new world and not everyone understands what has happened with this technology. It's incredible. Yeah, if I could just ask, there is a profound impact here, Jim, for both employees and employers. We're talking a lot about changing the employee experience through this new announcement. But also, if you're an employer, there are many things you can get through the integration of our data sets. For example, you can do precise workforce planning, taking a look at all the skills that you have in your workforce, and matching it against the demand that you have from your Salesforce data. For example, think about doing continuous financial planning, leveraging Workday's financial planning platform, looking at the forecast you have in Salesforce, pulling those two data sets together and determining whether or not you're on track to meet your financial goals or objectives. And last, an example, Mark, I think that's really powerful. You touched on it. Is if you're a sales rep, a Workday sales rep, you're in Salesforce because we use your platform and you're working on a very complex deal. The system now will provide you prompts on what to do next to help close or accelerate that opportunity. So there are many different use cases for both employers and employees. That's the power of all the data sets we have coming together. At the same time, Carl, I joined the company. I want to know my benefits. Yeah, normally I'd have to take somebody's time. I would have to get that person in the phone. Maybe they come back. Maybe I use Slack. Maybe someone gets back to me. But this way, if I have any question that's already in your data, it's answered what in a second. It is answered a second. In fact, we think employee onboarding is a great use case for this for this joint partnership. We can accelerate from days to hours or from hours to minutes beyond boarding of an employee. We also will provide a self service HR agent through this partnership that answers all the questions. For example, if you want to know how much PTO do you have? What's my pay stub look like? What's my taxes? What are the policies? How do I update my benefits in this platform? That can all be automated through this new joint partnership and this new service agent. That's also why I'm so excited because this idea that we're able to deliver this new generation of agent technology, this agent force platform that we've talked about, Jim, and how incredible it is. And then to see work they building on that platform and delivering this incredible capability and integrating with the data cloud, all of our customers going to benefit just last week right here on this floor. I had Siemens and you know Roland Bush, the show. Amazing company. And it's a huge joint customer, both of us. We work with them very closely worldwide, standardized on Salesforce and standardized on Workday. But the vision for that means that they can have not only a customer service agent, an employee service agent, sales agents, all of these things working inside their company. That is a powerful next generation of what we mean for the global workforce. Well, that gives us growth opportunities, all kinds of new opportunities to automate these tasks and deliver it. And it's because we're building this federated data set and with a common user interface with Slack. These three things together deliver this next capability of the enterprise, a new automated enterprise. As I said, we're humans with AI are driving the success together. I understand I do want to focus just for a second on the competition. The competition service now does not offer the sales component. They don't offer the waterfall component for the CFO. Are you going to come in underneath them in price when you when you do this or is it going to be something that you say, listen, you're good. Jim Jim Jim Jim Jim, they don't offer anything in this category. They don't have it. They don't have your your confused. Let me explain to you what Salesforce does. We're the number one CRM and sales and service and marketing and commerce. And in all of these critical customer touch points 230 petabytes of customer information. This is the number one HR provider. Okay, incredible financial provider. We use their financials and their HR. You've seen you see a layer not completely. You've seen you see that. Look, that's like saying that, that's like saying, we are Schnitzel is competing with McDonald's. This is not, we're not. This is two different things we're talking about here. We're talking about how do we deliver the next generation of customer experience, the next generation of the employee experience. How is it that humans with a with AI are going to drive this success together sounds like apples and oranges to me, then, gentlemen, right apples and oranges. Hey, Glenn, I think what you have this idea of this vision, Jim, that you need to federate your data, get these data sets together. You need to automate, you know, your customer touch points. You need to be able to deliver these agents. You need to be able to deliver the analytics, by the way, with things like we have like Tableau that we're working on together as well. All of these things together make up the next generation enterprise. Well, and that is what it's going to drive innovation and growth and profitability and margin and productivity and augmenting our employees using these amazing new technology. Excellent. That's what we're excited about. And Mark and Jim, if I could just add, if you think about this exciting strategic partnership we're announcing today, it really started 25 years ago when Mark, you try and they pioneered the movement of, you know, your CRM platform to the cloud. Five years later, our founders here birthday, right, David and Neil pioneer moving HCM and eventually ERP to the cloud. Fast forward 20 years later, I called Mark five months ago and said, we have the three most powerful data sets and system of record in the enterprise between our CRM between our financials and HR. We need to come together because there's no two companies divide that level of data set for the enterprise, other than Workday and Salesforce. And that's the exciting project and it's all automated. Jim, I'm going to have to move on, but thank you for explaining to me and to everybody the importance of this joint feature. Thank you, Mark Benny. I'm Steve, you have a great course, Carlos, but you will see me in three of fours, absolutely. And Carlos, we're seeing a work day, Elton John. Fantastic. And man, buddy's back here for the break. Coming up, Thermo Fisher turned in a sterling quarter. Kramer digs into the scientific method. Next. 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Start a 30 day free trial at walmartplus.com. Paramount Plus is central plan only. Separate registration required. See Walmart Plus terms and conditions. Never the mark is melting down. You need to search for stocks that can triumph over the gravitational pull of the averages. Today, Thermo Fisher Scientific pulled it off. I'd like to describe this company as an arm stealer to the life sciences industry and this whole group had an extended post-COVID hangover because so many bio-pharma outfits ordered more equipment than they needed during the pandemic. At the beginning of the year, though, I told you that the life science stocks were ready to make a comeback. And today, Thermo Fisher delivered reporting a strong revenue beat with a 25 cent earnings beat off a $5.12 basis to stop that management raise their full year forecast. If you believe Wall Street's consensus estimates, this should be the last quarter of revenue shrinkage before a major pickup in the second half. If that's the case, then I bet this stock has plenty more room to run, and I'm saying, even after a gain more than 4% today. So let's go straight to the source with Mark Casper. He's the chairman, president and CEO of Thermo Fisher Scientific. For more about the quarter and what comes next, Mr. Casper, welcome back to Mad Money. Jim, it's great to be back with you and thanks so much for having me. Well, Mark, it is great to see you, and it looks like it's so hard for people to understand. They'll see some minor signs, they'll see some things that don't look like Thermo Fisher, but the fact is, because of COVID, there was a distortion. And now all of your end markets seem to be turning, which gives you the same old kind of long-term roadmap that we're always used from Thermo Fisher. Jim, it was really encouraging second quarter, another quarter in a row of playing out as we expected and allowed us to execute well and beat our numbers and ultimately raise our guidance. When I think about our end markets and really where investors were paying attention was, would we see the improvements? And what was great for Thermo Fisher is, we sequentially improved our growth in all four of our end markets, and that certainly bodes very well for the second half. What we're also talking about picking up some market share gains, is that from other companies here overseas, where's that, where are those gains coming from? Yeah, when I think about the company's long track record over many years, we've been able to grow about three points faster than the market, and that's been consistent in the most robust of times or even the more challenged times. And when I look at this particular quarter and we clearly had another very strong performance of growth relative to others, you can see it in a few of our key businesses. In our clinical research business, which we acquired three years ago, we look at things like authorizations, the new clinical trials that we win and we had a very strong set of performance. When I look at our bio-production business, the business that's used to help produce medicines, again, very strong step up in performance. And one of our largest businesses, analytical instruments, having 3% growth in the quarter, clearly outdoing many of the peers. So very widespread, broad-based and really great execution by the team, and I couldn't be more proud of the efforts that they're making. I also know thermofissures and alpha that always comes up with some incredible new products. We call them high impact innovation, what do you have for us this quarter? Yeah, so actually Q2 was a very strong quarter. I'll really focus in on our mass spectrometry products. That's our highest in instrumentation used to advance life sciences research. At the scientific conference that happens each June, we launched in this year the Thermoscientific Steller mass spectrometer used for protein research to help identify the right biomarkers to ensure the efficacy of a medicine. And the excitement from our customer base has been hugely positive and bodes well for our growth going forward. Are we seeing enough companies, biotech companies, come public that will have enough money to be able to buy the equipment that they need, but equipment from you, that they need to be able to grow? Yeah, so Jim, when I think about the trajectory in biotech in terms of funding, right, you saw in the fourth quarter M&A activity return with larger companies buying some of the smaller companies in the first quarter, you saw the venture capital money start to really flow back into biotech, a reasonable quarter again in the second quarter. In fact, I think about funding in the first half, I think we had as much funding go into biotech as all of last year, just in the first half. And I think that bodes well for the IPO window, although you're much smarter than I to know when that window goes forward. But clearly, it's good, it's good. Now, let me ask you about another thing, it's different, although we deal with Boston Scientific, but you're the other company, I saw that in good numbers in China. A lot of people waiting for China's stimulus, you obviously don't need to wait for stimulus, you're getting orders right now. Yeah, so when I look at China, while the economic environment is still challenging, the government has announced stimulus programs, which should affect us late this year and certainly into 2025 in a very positive light, the team did a good job. We were able to deliver about 5% growth in China against certainly above the expectations of our external investors, and I'm proud of the team's efforts to really serve the customer as well. Really strong demand for our instrument business, particularly in China. Okay, now I was really pleasantly surprised to see the balance sheet optionality. You have 7.25 billion in cash, that means what for buybacks or if there's something out there to buy, you'll be able to snap it up. Yeah, so when I think about our capital deployment approach, it's been a proven one that's created a lot of shareholder value. We have a balance of return of capital as well as M&A. This year we've already returned about $3 billion in buybacks in the first quarter. We just closed in July, a $3 billion acquisition of O-Link, a very exciting company that's adding to our proteomics research offering, one that's a high growth business, and we have a strong balance sheet that allows us to continue to find opportunities to add to our portfolio and create even more value for our shareholders. And in an environment like the one we're in now, thermal fishers really poised to be able to capitalize on those opportunities. I totally agree, it's really just the second great quarter and it's obviously thermal fishers no longer cloudable. Well, the great work you did frankly when COVID was raging. That was great work and you had to do it because it's who you are and who your company is. But now I got what I remember as thermal fisher, which is just beating rays, beating rays and doing all the right things. And I thank you so much to Mark Casper, Chairman, President and CEO of Thermal Fisher Scientific. Mark, this is a really clean quarter, thank you so much. Thanks for having me. Of course, may I buy this back here for you. Coming up, Boston Scientific has seen sales surge. What's at the heart of the game? Stick with Kramer. I got it today. I really feel for the great company. He said the misfortune to report terrific numbers on a hideous daily today. Take Boston Scientific, the major medical device maker, which delivered an extremely strong revenue beat with 14.7% organic growth. Well, underneath 62 cents per share, it was $1.58 on top of that management even raised their full year forecast substantially for both revenues and earnings. Yet the stock got hit today, trading down about 1%. Some of that's the ugly tape. So much because Boston Scientific had already run up 36% for the year going in the yesterday's close. So maybe it was due for a pullback. I think it's a buying opportunity. Don't take it from me though. Let's check in with Mike Mahoney. He's the Chairman, CEO of Boston Scientific. He had a better sense of the quarter. Wow, Mr. Mahoney. Welcome back. It's a fan of money. Thank you for having me, Jim. It's an honor to be here. Oh, please. The honor is mine. You have delivered and delivered and delivered. And you did it again. For those of you who are perhaps not familiar with Boston Scientific, you're manufactured medical devices, minimally invasive. But why don't you talk about some of the composite of this amazing quarter? We've got to talk fire pulse. We've got to talk watchmen. And we've got to talk Silk Road, which is a brilliant acquisition. Do we have 30 minutes? Anyone who's got a heart problem knows your company. And if they don't, they should, because that's how excellent your science is. Why don't we, top level? Whichever one you want. Maybe it's once when you want to start. I'll give you a breakdown. First of all, I'm so proud of what we've done as a company and our global employees around the world. You know, over the course of 10 years, Jim, I'll talk about the first half in the quarter of a second. Over the course of 10 years, we've consistently increased our organic revenue growth. The markets that we serve in our EPS growth while improving margins. So we've really had a strong track record of consistently delivering results and strengthening results. And we're really looking forward to the next chapter. You know, the second quarter was fantastic. We grew our top line business, 15% as you said, about 15% EPS growth. For the first half, we're at 14% organic growth and 18% EPS growth. But what's amazing about it, besides the innovative technology you want to talk about here, is just the balance of the growth around the world. We grew double digits in Europe, Asia, and the US. And our cardiology business is as you called out. We have eight divisions in the company. But our four segments within cardiology grew over 20% for the quarter with stand out performance from two big areas. One is the electrophysiology business, which is our EP business led by Fairpulse, which grew in the US 200% and 100% globally. And our Watchmen franchise, those two businesses are uniquely special in MedTech, where we have a significant competitive advantage and significant room to grow. Now, you actually had good numbers in China. No one has good numbers in China. How much in critical is what you do that you actually had great numbers in China? We have great numbers in China. We have a terrific team in China. Jim, it's always about the strength of your team, the engagement, and your innovation portfolio. And that's what we have in China. We have a diverse set of businesses in China that we started off years ago with just drug looting stents. Now, drug looting stents is a small part of our portfolio. We have a wide business within peripheral interventions. Oncology and DOS could be urology. That business grew mid-teens in the quarter, despite some of the pricing challenges and macro challenges. But, you know, there's about over a billion patients in China, and we are a healthcare company first. And they have significant demand for our products. It's a very competitive market. But our local team finds a way to work with customers and really outpace our competition in China. We expect to do that along with the entire global company for many years to come. Now, this Silk Road acquisition, which I thought was brilliant because when you go to a cardiologist, he says, "Listen, we've got to measure your carotid order." And no one even knew 10 years ago or even five years ago how important this is. This is just incredible science, this tea cart. Can you tell us about it? Sure. So we have many products that impact stroke. Fairpulse for EP, Watchmen, that reduces the risk of stroke and gets patients off blood thinners. And now Silk Road, which we haven't closed yet, but we anticipate closing in the second half of this year. They're really the pioneer of what you said called tea car. So patients oftentimes will have a carotid artery disease where plaque will build up in your carotid artery. A very dangerous condition. The common treatment prior to this was surgery. Anytime you have surgery, it certainly works well, but it's a longer recovery period. And they have an interventional technique to remove that plaque and free up that stroke risk. And they really are the pioneer there with great clinical science. It's a growth that will be accretive to the company and will also take that product internationally outside of the U.S. And our operations team will do a great job working with them as well. So it's a terrific addition. You know, M&A and General Jim has been a big part of our story. We've acquired about 35 companies since I've been CEO. And we have a very active venture portfolio of about 40 companies in our venture portfolio. So we're very active globally, scanning investments, bringing small companies into Boston Scientific, taking the best of what they have, but growing them up and expanding them around the world. But I also think that it's even better than that. A lot of companies buy a lot of companies in your area. And you never hear them again because they really are bus. I mean, I see these numbers. And you've got so many double digit winners after you buy them. So someone is making judgments. Like, when I saw a silk resin, how come some bigger company didn't get that? And the answer is, both sides. You're very nimble. You're very quick. And you've got a real clear mission when it comes to the heart. And when it comes to, well, I mean, let's give an example. When you talk about watchmen, this is something you literally, people have to know this. The device is designed to close the left arterial appendage in those with AF. I mean, you actually close the appendage, and that's okay. Yes, it is. So this is a product that we pioneered through multiple years of product technology and clinical innovation to finally get approval in the U.S. So gym patients with atrial fibrillation, which is over 30 million of them, have a higher risk of stroke. And many of those patients have a hard time with blood thinners. Either a high risk of bleeding based on their occupation, or they just can't manage the blood thinners, or they're not compliant, which about half the patients are. So the beauty of watchmen, which is a procedure that lasts maybe about 40 minutes and patients are in and out within five hours routinely within the hospital. This device will reduce the patient's risk of stroke and enables patients to get off blood thinners, which is a terrific win for patients. The healthcare economics works for hospitals very well, and the doctors can perform it incredibly safely. And more as importantly, we're doing the clinical science work to make this potentially first line therapy for blood thinners. So this market, which we've created, could turn into about a $6 billion market over the coming years as these new clinical indications expand. Wow. Okay, I believe that because you've been able to deploy these ideas and really make them into major hits. I'm first just very impressed with you. I know everybody here always says, I always say, "Oh, darn, Boston Scientific, when are we going to get the blood?" And the answer is, you came home when we actually really appreciate what's going on. Thank you, Bill and Reebok, who called and said, "Look, Jim is just desperate to have you one because you are such a winner. Mike Mahoney, Chairman, CEO of Boston Scientific. Thanks for coming on the show." My pleasure. Thank you very much. Absolutely. Me and my team will be back in the break. ♪♪ ♪♪ It is time to jump in the lightroom, Christopher. We're going to talk a little bit about the biosolce. So just go ahead and do the course, talk a little bit. That might be a bit simpler, but you can play this out. [buzzer] And then the lightning round is over. Are you ready to ski? Daddy, come to the lightroom. Come on, Christopher. Start with Charles in New York. Charles! Hey, good evening, Jim. This is, uh, Green from Long Beach, New York. I'm curious what you think about Audia. Hey, I know, I know it. And you know what? In that same Venn, in same kind of Venn diagram, I would actually put Trade Desk, T-T-D, which was down very badly today off of Alphabet, and I think that's the one you want to buy. And then you go to Josh in California, Josh. Jim, thanks, Baldis. Boo, not to fall. Now with the bet. Completely right. $35 trillion in debt, imminent transition to CBC. If it's time to follow a warm buffet and buy precious metal minor stocks like hecra mining, give it to me for the win. I have always been a believer in the gold stocks. It's not always worked out, but right now it is. Yours is good. I actually, but still, I prefer actually a mutual fund that has it. I think that may be the best way. That way you avoid getting stuck with a stinker. Let's go to Dave in Illinois. Dave! Dr. Kramer, my good man friend, my director today, is little Jamia technology. Have you heard of it? Yeah, it's not making a lot of money, Dave. You have to woo me on this one. Good afternoon, young man. This is Mary and Idaho. How are you, Dave? I wanted to get your recommendation on a stock broadcast. I like coming up on my travel trust. I think it's absolutely tripping. It's going to get hammered along with the rest of the rotation. And I just say, by the way, my love is still also with Dave. From Illinois, and it's killing me, Dave's like the land of Lincoln. It's the land of Dave. So I didn't mean to cut him off, but what can't do? Sometimes things happen, and I apologize. I apologize. I want only a lighting round with Dave tomorrow. Nobody else. Let's go to Jerry and Ohio, Jerry. Yes, I'm interested in A-V-A-V arrow. You know what? Okay, let me give you the bull and the bear on A-V-A-V. My friends who watch the show say, Jim, you don't understand, their stuff is way too expensive. It needs to come down versus the price of the Iranian drones. All I know is that drones work, and therefore it's a buy. And that, ladies and gentlemen, the conclusion of Dave's lightning round! The lightning round is sponsored by Charles Schwab. Coming up, Tesla, for the long term, why their bankable CEO is himself a reason to believe. Next. Last night, I was reading through this test at conference call for a second time as it was so meeting. And my wife called. She said, "I sat him down." And I admit I was really bummed him. I told her the source of my shagrin was not other than Elon Musk. "What did he do this time?" she said. And she thought it was something political. I said, "He didn't do anything. I just knew that no matter how hard I were, no matter how hard I studied, I could never be as smart as this guy." Even watching Tesla fall 12% today, it's impossible for me to appreciate the shadon for it. Why? Okay, let me unbird myself to you, because it's the only way to understand what Musk had got going for. First, I understand that last night's conference call was like nothing I've ever heard, even from Tesla. The auto business, the plain old Tesla, disappointed people. They aren't selling as many cars as we thought. They aren't doing anything overtly revolutionary. No two-minute battery charge to the time we'd take to fill an SUV. No, no engine that can give you 600-mile per charge. But what surprised me of Musk actually cracks the code for both of them. Instead, he's while he's with talk on the most advanced humanoid robots in the world. He thinks that the long-term value of Optimus' robot initiative will exceed that of everything else Tesla has done, and it will be worth trillions, because we all will want a robot. You've got to wonder how much of that is real. But even if a fraction of that humanoid robot story comes true, shareholders will make fortunes. That must talk about autonomy and the joys of the fully self-driving vehicle. And he thinks it will soon be ubiquitous in every country, including ours. Sales preposterous? Musk says, and I quote, "If you've got billions of miles that show that in the future, unsupervised, full self-driving is safer than human, what regulator could really stand in the way of that," end quote. He argues it will be part of a customer-owned fleet, kind of like an Airbnb on wheels. He's betting on autonomous driving could be a $5 trillion business. And then there's Tesla's energy business, specifically the energy storage backlog. This quarter, energy storage deployments more than double, giving the division and record results small, but doing incredibly well. Plus, while Musk called out Nvidia as a darn good manufacturer of high-end chips, he wants to go against Nvidia too, because he can't get enough of their best semis. I believe it, but not anytime soon. Now, the irony is, despite Musk's best efforts, today was a day when people said Tesla's just a car company and nothing more. It doesn't have anything in your term to congestify the stock's current valuation. He told a great story on the call, but nobody cared and gave him the downbeat environment for the megacaps, of which he has one of them. Perhaps you have to buy this weakness because of the future, which seems very bright. I actually think that makes sense, at least as a place to start buying. What matters is that you have to wait, you have to be patient, you have to be long-term oriented, traits that are in short supply on Wall Street. As I see it, the key risk with Tesla was that Musk might leaveovers pay package. Now that he's staying, I recognize that he's just better than everyone else when it comes to envisioning the future. Perhaps with a sole exception of Jensen Wong from Nvidia, who's also, by the way, a lot more fun to hang with. So, Musk's baggable, and the rotation of the menus in this segment could give you a chance to put his jeans to work for your portfolio, and it's probably right here worth taking. I like to say, there's always a bull market somewhere, and I promise you I'll find it just for you right here on MedBuddy. 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 MedBuddy disclaimer, please visit CNBC.com/MadMoneyDisclaimer. Join FinterAct, a peer-to-peer community of financial services professionals, and keep your finger on the pulse of the industry. 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