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 7/9/24
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And the byproduct of the merger is the new delicious Jif 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 Jif PB&C. 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. Mad money starts now. Hey, I'm Kramer. Welcome to Mad Money. Welcome to Kramer. Welcome to my friends. I'm just trying to make little money. My job, not just entertain, but put all this in perspective. So call me at 1-800-743 CMC or can we be at your grammar? Okay, everybody knows I get it pretty early, right? 3.30 is my target time. Now, some of that's to do work. Some of it's to get the zeitgeist of the day. And most important, a lot of it's for the top 10 things to watch memo. I write every day for investing club members. That's where I highlight what the big shots are thinking when it comes to the mountain of research I get every day. And in the absence of earnings, it's that mountain of research that matters. You see, the season isn't going to get rolling until Friday. I like to peer at multiple pushes, multiple upgrades, and price target hikes, because right now, in the absence of earnings, they often determine the action of days, like today, where they ultimately dip 53 points, that's to be inch up .07 percent, now it's like advanced .14 percent. See, like so many other days lately, most of the big calls were about the sainted stocks that we talked about all the time. The apples, the lilies, the amphibies, the microsos, and they're all positive. And you know what? I don't know whether you can really understand this. Most of the time, these research recommendations are working. They have the intended effect. They're moving stocks higher. The endless buy recommendations for the tech titans are really the major reason why we keep getting these new records, both in the market and individual stocks. It is a cheap reason why the tech doing is so darn great so many days of the week that cheerleading. It is impactful. The stocks, they continue to roll. So let's review just one day. One day's bouncing. So you know why stocks just keep working their way hard. It's been a couple of days since Nvidia's had any champions. But today, the analysts ran a full court press against any remaining skeptics. Yep. And analysts at KeyBank raised his price target from 130 to 180, talking about how the demand for Nvidia's new platforms is extraordinary. And by extraordinary, I mean insane. It's the Blackwell formulation these chips in their company systems have turned out to be even more popular than we expected when Nvidia first rolled them out at the GTC conference, the big trade fair that I went to earlier this year where I couldn't have been more bullish. I wasn't bullish enough. Now, plenty of people wonder if Blackwell could cause a major problem for Nvidia because if the new chips are so powerful, why would you ever go buy the current iterations when you just wait for Blackwell to ship volume in the fall? But just as the amazing CFO Cole at Crest told us repeatedly, there are no transition worries. The current iterations from Nvidia work well with Blackwell. So there's been this continual ordering right into the Blackwell cycle. Positive, virtuous demand for Blackwell, which allows gender of AI to be fed, not just text, but video. It's so strong that you have to wonder if it will be far bigger than initially thought. It doesn't hurt, by the way, the Blackwell is more of a software platform than just a chip inserted into some sort of ecosystem, not from Nvidia's own. Nvidia makes the chip and the ecosystem. And you know what that means? That means higher gross margins. KeyBank is talking about $200 billion in data center sales for 2025, which is 60 billion more than the consensus that people are looking for for Nvidia. Data center investment is accelerating. Can't be more than put out an estimated customer mix for Nvidia's best chips. Get this. Microsoft's taking 28% Med of 14% Amazon Dell and Super Micro each taking 10% Google 7. With customers like that, someone they can charge upwards of $35,000 per chip. Next, noise has been righteous. By the way, Ben has been right the whole way on Nvidia, says that money managers are actually underweight the company's stock, meaning they need to buy more if they want to kind of more accurately mirror the SP 500. Do you think you want to show investors that you were underweight one of the greatest performing stocks of all time? So they've got the rest of the year to do some buy before their clients find out. I also think, by the way, they were finally working through the churn that came from Nvidia's 10 for one stocks, but I told you that would take a while, took a little longer than I thought. But if it were just Nvidia, well, I'd be talking about something else right now. And that's why when I saw Bank of America had a cogent note on the Apple App Store this morning. Now predicting 14% growth for Apple's fabulous service revenue stream, I recognize that we're getting a solid reason to feel optimistic even up here for Apple. Something that could spur more price target bumps tomorrow. I also think by the way, the F1 movie, that's a blockbuster being put out by Apple original films, could be the first production to really move the needle for Apple TV plus streaming services, a blockbuster that it costs less than going to the theater to take Apple. Plus, I think it's going to mean something. Meta and Google needed some good news to justify their recent rops. And Goldman Sachs properly gave it to us, providing it saying that things are looking up for their digital advertising businesses. Digital brand advertising is very strong and will benefit from these your comparisons versus last year. Goldman also likes what it sees with the deployment and neutralization of AI across the digital advertising space. Again, a justification for current and future prices. That's what the research departments are doing. Last time we got this call from Arthur New York. I don't know if he caught it. He was worried about the government made me break it up by Amazon. And now I don't think it's like this, what I said. But right on time, we have a note from Jeffrey's giving us the sum of the parts valuation for Amazon. Apparently it'd be worth 18% more than it is now if they broke it up. Thanks to the strength of Amazon Web Services and Amazon advertising. And no, the stock is not going to be hit by all the stock that we learned later tonight. Jeff Bezos sold. That's just something that people do. Okay. Jeffrey's Brent Phil points out that their cloud business is going gangbusters, accelerating from previous quarters. He says advertising to stable 20% grower with optionality from prime video. The mess of logistics spending for the pandemic years is behind them. Meanwhile, he notes that Amazon keeps getting any market share by reducing friction with the consumer. Getting product to the show. You know how quickly it comes now. Incredibly, the stock's selling at a 25% discount to its 10 year average. Base case Amazon 235 stocks currently under $200. Incredible. Hey, Phil was busy last night. He also put out the survey of 40 US chief investment officers on cloud spending. Can you imagine those guys must be a more fun than a barrel monkey, so you think? And they're opening their wallets big time. Apparently, cloud spending is biased to a double digit increase with AI being a material driver. Oh, and get this. Microsoft's Azure is edging out Amazon Web Services in the survey 45 to 43%. Remember when Amazon was at the bottom itself? I'm this incredible. Think about all these. These are the stocks that dominate the market. Today, I heard someone say that this is just like the concentration of companies that led the market in the year 2000, which of course means. Now, this is one time I'm happy to be a grizzled veteran. Ages are worth much except when it comes to the history. So I'm going to tell you that unlike the leaders of the dot com bubble, these are insanely profitable companies that I'm talking about and they keep innovating and keep giving you reasons to buy and they are rational reasons. Sure, I don't want people to simply pay more for the same business over and over. That's called multiple expansion. Don't like it. These companies are pivoting constantly, giving you actual legitimate reasons to boost price targets. That wasn't the case at all back in 2000. We were constantly paying more for shares in companies that brought nothing new to the table until the quarter and then they just issued disappointment after disappointment after disappointment. They were the opposite of these businesses. The bottom line, there are many things you can call these magnificent mega cap companies. But unlike 2000, ridiculously overvalued, ain't one of them. Danny California, Dan. Mr. Kramer, thank you very, very much for everything you do for the little guy. My question, thank you. My question is regarding Celsius and it has dropped considerably in the last 45 days. And the only thing that I can find out is that one of the people who owns 10% of the company sold $25 million worth of his stock. That's all I know. And I don't understand why it's dropped some more. Well, there had been some decline in the growth rate very subtle in the last few in the last few weeks. And there was also a story about how their stuff was heavily being heavily dislocated at the club's stocks at the Costco kind of thing. And that's what's keeping it down. The numbers that came out this morning were more positive. I'm not giving up on Celsius. I think it's a very interesting story. And thank you for the con words. Let's go to Mark in Washington, Mark. Hey, Jim, thanks for taking my call. Of course. I've been holding on to, I've been holding on to Eaton for the last two years and watched a great run up. Is it time to sell or should I go longer? No, you want to own Eaton. We've been, we've put a very nice position on for the travel trust and we've been telling people, look, when you hear data center growth, Eaton should be one of the ways you played it. I know it is stalled here. But remember, it's not going to be one of the same in seven. It happens to be a great industrial that I think is going to have a very good next couple of years. Barbara, New York, Barbara. Hi, Finn. Barbara. I'd like to know what you think of constellation. Oh, constellation energy. Okay, we like constellation energy very much. That's nuclear. It's clean. It's what people want. I'll give you a two for the travel trusts. We own constellation brands, and we said yesterday we had the trim a little because we just didn't like the fact that they kept the wine in this beer. But I'm liking both constellation energy and constellation brands. There you go. All right. Now, look, there's a lot of things you can call these magnificent mega caps, but ridiculously overpriced. Ain't one of them. They have money tonight. Test of the shares. I know you care about that are electric of late book with the ride. Continue. I'm giving my cake. Then I'm going to bargain hunting in the retail space. And with Billie, it's time to circle back to two stocks that I really like. And I'm not going to mention their names best by index and rollercoaster profits. I'm breaking down what the merger between Cedar Fair and Six Flags means for you. So stay with Kramer. Don't miss a second of Mad Money. Follow @chimcramer 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. At EverNorth Health Services, we believe costs shouldn't get in the way of life-changing care, and we're doing everything in our power to make it possible. 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Visit chevron.com/anchor. In case you missed it, Tesla's on fire again. In the past four weeks, this stock rallied 54 percent with companies marketing capitalization climbing from $544 billion, where the odd people flow was very expensive, to north of $836 billion. That is staggering. With today's 3.7 percent gain, it's now up for 10 consecutive sessions, people. In fact, when the stock finally bought them back in April, it was down 44 percent for the year, because it felt like everybody had given up on the market electric vehicle industry. But after its recent run, Tesla's now up more than 5 percent for the year. Those who sure are down there, they've been crushed. So what that happened to get Tesla stock behaving like the old self again, and more important, can the stock maintain its momentum? First up, Tesla started worrying when Elon Musk won approval for his enormous $56 billion pay package last month. There was a real feeling that Musk might lose the vote, and well, let's just say if he lost it. A lot of investors are very worried that he might end up devoting much less time to the company. That's an existential threat that was averted. No matter how you feel about Musk, if you're a Tesla shareholder, you want him working full time at Tesla. So once he got his pay package last month, it got rid of a major source of uncertainty, and that indeed is what kicked off the month's run. Now second, number two, we know the electric vehicle business isn't doing great for anybody, including Tesla. But Musk is a master showman, and he's apparently gotten his investors to look past the current state of the core business. Instead, he's directed their focus to Tesla's future initiatives, especially autonomous driving, robo-taxis. That's very big and energy storage. He was already doing this back in April when Tesla imported first quarter results that fell short of expectations. But the stock's sorting responses must talk about these new technologies, including a robo-taxi debut event on August 8. I would call that to be a much-anticipated event, but that's just too much of a cliche. Along the way, there have been some incredible wins, but they're incremental, but I think they're big that make the future initiatives seem more plausible. Like when Tesla won approval to deploy its, quote, "full self-driving system" in China in the final days of April, I thought that was incredibly significant. So Musk got investors to focus more on what's to come rather than what's happening right now. And that contributed to the first portion of the stock's huge move, but that brings me to item number three. It helps that Tesla's core business has finally started to stabilize. The last Tuesday, the company imported second quarter delivery and production numbers, and they actually surprised to the upside. Nearly 4 in 44,000 deliveries. Wall Street was only looking for $4,000 and $3,000. Hey, listen, we'll take it. Now, in vacuum, that's not actually a great number. It represents nearly 5% the client year over year. But everything's relevant in this business. Not only was the delivery's number better than expected, it was also an improvement from the previous quarter, where deliveries were down 8.5%. In fact, when you look at the quarter quarter comparisons, Tesla's deliveries were up 15%. At the same time, the second quarter vehicle production number was just 410,831. That, 410,831 vehicles, and that was, well, way below deliveries. Positive, because it means that Tesla won't have any inventory problem. Too much unsold merchandise means you need to start heavily discounting your product. By the way, Tesla doesn't discount. Fortunately, now that's off the table. Fourth, there was one more item in this second quarter update. Tesla deployed 9.4 gigawatts of energy storage products in the quarter. That's something Morgan Stanley Ottawa knows Adam Jones is called a show stealer. He was expecting barely more than half that. Remember, we have endless demand for electricity from all these AI-powered data centers, and companies want to use renewables for that energy. But when the solar aren't reliable, unless you got storage, which is where Tesla comes in. Finally, there's one more reason Tesla's been roaring, and actually I'm less excited about this one. Retail investors have fallen in love with the stock again. We've seen the meme stock cohort try to make a comeback. They attempted to resurrect GameStop back in the spring, and it didn't last. They got crushed by the pullback in crypto. Roaring Kitty tried to bull up Chewie, and that rally didn't even last a day. And by the way, I'm proud Chewie, but we like to remember it 19. That's why I think many of the meme stores have returned to their first love, which was Tesla. You can see it when you look at the volume in Tesla's options recently. That's where the action is, the options. The most aggressive home gamers have found their way to options over the past couple of years, especially very short-term options, even ones that expire in a day or less. Earlier this week, we learned that options traders have become the most bullish on Tesla that they've been in three years. Just yesterday, CNBC's Jason Gewerx noted that Tesla's options volume was double the 10-day average. That is a tremendous insight most people missed. All that has really helped to push the stock up from behind the scenes. So that's how we got here. What comes next? That's what matters. Honestly, who knows? The bulls are certainly in charge again, and given the way this thing's been trading, I think anyone who tries to short Tesla, why don't you know what? I'm going to send out some funeral invitations beforehand to those who want to short it, just to have them on hand. However, when I see what's been driving this rally, I kind of worry a little bit longevity, 10 straight days up. Tesla's got two big catalysts coming. They've got the company report for a full-second quarter earnings, two weeks, then it holds that big robo-taxi event a month from now. While we know Tesla beat the delivery estimates for the quarter last week, we'll only find out how they pulled it off when we get the complete results. I really don't want to see a significant drop in average selling prices, which would mean that Tesla was only able to hit its delivery targets with heavy discounting. That said, Tesla's conference calls are a wild card. Who knows what Musk will say and how investors will react? Although, I have to admit, he's gotten a little bit more kind of rational lately. Even when we get a drop in average selling prices, Musk could say that the Cybertruck's selling great, and the stock could rally in response to that. As long as the shareholder base is on board, the guy can pull a rabbit out of a hat. We know that David Bland, okay? Given that Wall Street's less concerned about the current core business and more focused on the future, I think the robo-taxi showcase on August 8 might be the more important event. I hope Musk can come and deliver a plausible plan for how Tesla can build a scaled robo-taxi network in a world where full self-driving is highly regulated and only could become big, especially in China. In the end, it's a big event that could go either way, so if it fails to impress, I expect the stock to get hit. But remember, I am focused on self-driving in China, which I think can be very big. Here's the bottom line. It's nice to see Tesla running again, and the last thing I'd recommend is to try to short the stock. However, I worry about how long the rally can last. I say we defer judgment. Let's wait until we see the full quarter in a couple of weeks, and then the big robo-taxi event in a month. Until then, I'm not ready to give Tesla my endorsement these new, much higher levels, especially when I said I liked it much lower, not that long ago. They have money. It's back after the break. Coming up, a Best Buy, two retail winners adjusting in the online age. Next. 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. 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They don't want to get involved, and that's why I always stress that selloffs and high quality stocks are actual buying opportunities. Even if it might not feel that way at the time. Luckily, we're getting a couple of these entry points and some terrific stores right now, and I don't want you to miss them. First, there's Best Buy, BBY. The iconic electronics retailer has been a nice winner for my child, trust. Most of the gains here came at the end of May when the stock jumped more than 13% after Best Buy reported a phenomenal quarter. It continued to work through mid-June, but since then it's pulled back, pulled back hard, and although the stocks already started rebounding from its lows, you know what? I think it's so good at your point. Why? Because there was a lot to like in that quarter. Even though sales came in later than expected, the company earned $1.20 per share, and that's why they're looking for Bucko 7. That's a first- first beat I really can recall it a long time. The stores are best buy strength. They're generating more high margin service revenue, which was enough to offset any concerns about lagging hardware sales. But the main reason best buy rallied like crazy was management's extremely positive conference call commentary. Even though the company had weaker numbers than struggling areas like appliances, everyone knows appliances are tough. They had terrific gains in services and laptops, which make up more of the business. On the call CEO Corey Barry explained, I'm going to quote her, "We have seen early signs of improvement as your rear comparable sales for laptops turn slightly positive in the fourth quarter, and that can trend continue in Q1." And why should we expect this trend to continue? Best Buy is confident that this upcoming PC upgrade cycle fueled by new models with built-in AI technology will lure in tons of traffic. Sure, you can buy a computer online like any of the analysts, but these new PCs, they're big-ticket items. When you're spending a thousand dollars or more on a machine, well, you're more likely to go to an actual store for some hands-on testing and maybe some input from sales associates. Plus, when it comes to the new AI-powered PCs, 40% of them will be offered exclusively at Best Buy. Very smart move because unique merchandise will bring people into the stores. Now, all that said, there is some concern regarding the health of the consumer to purchase such expensive products, the fact that management didn't shy away from one to call at all. And they acknowledge that the electronic space has suffered in the years since the pandemic because so much demand got pulled forward during COVID, the home office issue. But when there's innovation, Best Buy is adamant that the customers come right back. For example, when they launched the line of iPads from Apple with the new M4 chips, Madman says that they saw these devices and would quote, "pretty much immediately stimulate some really interesting demand," end quote. And these new iPads are already boosting their sales in the current quarter. How about the guidance? Well, Best Buy left the four-year forecast unchanged. They did mention that their just-adjusted operating profit should come in towards the upper end of the projected range. Hey, to me, that sounds like a good guide up. So Best Buy reported at the end of May, the stock quote fire, ultimately riling all the way to 93 and change at its peak. Since then, though, the stock's been clobbered. It fell to $81 last Tuesday, where, by the way, we told members of the CNBC investing club to buy more and I bought stock from a child with trust. Clearly, the market agrees, because Best Buy's now rebounded 86 and change. At the sale, that's a solid discount versus where it was in mid-June. And I think it remains a strong buying opportunity. I picked some up right here. As we've been telling members of the investing club, we want to get in ahead of the expected inflection and same-store sales growth later this year as we wait for the AI-driven innovation replacement cycle to turn. And remember, I'm a big believer in it. Oh, by the way, it doesn't hurt that the shares are paying you a hefty 4.35% dividend you'll want to wait. Next up, in the last couple of weeks, we have seen a big pullback in Dick's Sporting Goods, another specialty we tell the importance of spectacular court at the end of May. Substantial, same-store sales beat, substantial earnings beat, great guidance. Somewhere in the stock, up nearly 16% the next day. Lots of impressive aspects to this Dick's quarter. First of all, they put a 5.3% same-store sales growth. Roughly half of that coming from higher transactions and half coming from higher prices. Clearly, managers doing just a great job of bringing in new customers. And these customers don't have a problem spending big as long as it relates to a healthy and active lifestyle. That seems to be the area that people still spend on, that and big travel. At the same time, Dick's has this brilliant house of sport concept. These are mega-sized, I don't know if you've been one. You got to go to one, mega-sized locations, build around exciting in-store experiences. I love the one I go to. It's a lot easier to figure out which baseball bad your kid needs when there's a batting cage on site. Dick also has a golf kicker with its golf galaxy performance centers. Oh, and let's not forget something that I wish I had had. Oh my god, this game changer app. This is a state-of-the-art live streaming, scheduling, score-keeping, communications platform for amateur sports. This app gives parents the ability to keep track of their kid's sporting events. Even when they can't be there in personal, I wish I had this thing when my daughters were little. Because I was a workaholic and by my own admission missed way too many important games. I think this is a hidden, very valuable asset. In some tapes, meaning stock market tapes, that are more forgiving, you know what? I think they could IPO this product for a billion dollars. Whatever the reason may be, it's hard to put a price on those memories and easy to see parents prioritizing that kind of spending. So far, it seems like game changers are a real hit. One of the cool imagine told us that the app now has over 5 million unique users who spend roughly 30 minutes per day on the platform. That is unbelievable. I'm telling you, this thing's for real. Going forward, Dick Sol says that and pretty darn excited about new products. They can sell alongside the upcoming Paris Olympics, available in the NBC Universal family of networks. They're on Peacock. They're okay. Peacock or the network. But by the, I should mention, they're on the network and also on Peacock. There are a bunch of companies rolling out breakthrough products alongside the Olympics, including the Bleagern Nike. Maybe that'll help them. Either way, it's good news for Dax. Now, just as important, management raised their full year outlook for same store sales and even raised their earnings per share forecast by 50 cents at the midpoint. Greater than the 34 cent earnings beat that Dick's have just reported, very encouraging. I love to see a company raise guidance after only the first quarter. It means business is going much better than anybody expected, even three months before. All right, but what about the stock? Now, Dick's stock initially jumped from $195 to $226 that they had reported, eventually peaking at $234 and changed just three weeks ago. Since then, listen to this, its stock has sold off heart and pulled back to just under 201 today. In other words, you're practically getting that amazing last quarter from free. Even if you missed the initial run, you are getting another chance to buy this one at a terrific price. Here's the bottom line. Best buy and Dick's sporting goods both reported much better than expected quarters this past spring, but now Best Buy is down almost 8% from his post during his highs and Dick has flown 14% to me. I don't know, these look like terrific opportunities. You know what? Let's go to Juan in Florida, Juan. Hi, Jim. Thank you for taking my call. Of course. Thank you for everything you do for all small investors. Thank you, Juan. Thank you. That is the essence of what we try to do with man money. I'm sorry to meet you up, but that is the essence. Go ahead. I watch your show every day. You have been very helpful. Thank you. I have a question on Cisco. I have a position at $50 per share, and the stock is not showing any signs of life. What do you recommend? Buy, hold, or sell? Oh, geez. Okay. Look, I think you had to hold it. We do need to see a big quarter from it. We just have to see a big quarter from it. And the reason why I'm saying hold is because you've got 3.5% yield, and that still works pretty good. But it's been a tough run. I do want Chuck Robbins to come on. He always tells us it is, but I can't account and then selling the stock down here with a 3.5% yield. Can we go to John at Connecticut, please, John? Yes. Hi. I own Intel, and it's not moved in many years now. And should I keep it or dump it? I think Intel's just had a nice move, actually. I want you to sell half tomorrow and let the rest run, just in case we see that there be a relief rally continues. But I don't think that you should be in the stock because it's bouncing. It's what I call a dead cat bounce no offense. My daughter's a cat sitter. I don't want anyone getting mad at me that I use that phrase, but it didn't feel like it had a dead cat bounce feel to me. All right. Both Dick's Sporting Goods and Best Buy reported better than expected quarters, and the recent declines of both names to me, that's looking like a real buying opportunity. Bring it, and much more mad money. Two amusement park giants just merged. So are investors of the new Six Flags Entertainment and for eight wild ride? Buckle your seatbelts, cowboy. Play Americans, get ready. I'm going to give you my take. Then in mythology, hell of a choice beauty was considered the cause of the Trojan War, but the stock hell of a choice looks anything but beautiful today. Our real what it's whopping 27% drop means for the overall market. And oil calls right back in tonight's edition of the lightning round. So stay with Kramer. If you were planning to hit up and amusement park this summer, you should know that last week two of the largest players in the space, Cedar Fair, and Six Flags, completing a merger of equals. The combined company is now known as Six Flags Entertainment, although they wisely stuck with Cedar Fair's old ticker. Fun. This deal is announced as a member in full disclosure. I really never gave a deal a chance because I wasn't sure it wouldn't even happen. I just didn't see the deal getting past the Biden administration's notoriously strict anti-trust regulators, who seem to believe that oil mergers are anti-competitive. Given that Cedar Fair and Six Flags were in the same line of business, I thought the FTC or Justin would actually try to block it. But apart from a standard request for additional information earlier this year, the regulators didn't lift a finger, and the merger ended up closing very quickly. It was all finished by July 1, and shares of the new company started trading exactly one week ago, why we needed to get this piece done. Clearly Wall Street wasn't too optimistic about the deal getting past the regulators either, because both stocks did next to nothing for months after the announcement. Then they called fire last month and said, "Hey, this merger is going to happen. Six Flags was trading in the mid-30s before the announcement. Last November, now it's at 55, and I wouldn't be surprised if it's got more room to run." Wow. What makes me feel so confident about this one? Let me walk you through it, starting with some housekeeping notes. Let's see what I understand exactly what's going on. First, while there's no such thing as a true merger of equals, this is about as close as it gets. It was an all-stock transaction where former Cedar Fair investors got 51% of the combined company, and former Six Flags investors got 49%. Key management roles were divvied up like this. Six Flags CEO, Salim Basul, became executive chairman of Combined Company, with Cedar Fair CEO Richard Zimmerman keeping that position for the new Six Flags Entertainment. The CFO of Cedar Fair is now the CFO of the combined business, and the former CFO of Six Flags has become the chief integration officer of the Combined Company. The new board is 12 members, six from Cedar Fair and six from Six Flags. Now, the combined business has 42 properties across North America, 27 amusement parks, 15 water parks, nine hotels over his horse, seven campgrounds, two safari or animal experiences, two sports facilities, three marinas attached to some of their largest properties. Wow. The reason I like this deal is that the old Cedar Fair was way too concentrated in the Midwest, while the old Six Flags was too dependent on the south. The Combined Six Flags Entertainment offer gets no more than 30% of his business from any single geographic region. This is one great deal. When you look at a close look at this thing, you see these businesses are quite complimentary. While Six Flags had more properties than Cedar Fair, Cedar Fair had higher attendance and revenue. Both companies had almost identical cash flow. Cedar Fair had higher overall profits, but Six Flags had better profit margins. The two companies, Cedar Fair, had the better balance sheet, but Imagine it says the combined business would be stronger than some of its parts, I believe them. First, fundamentally, they say the combined business can offer a more diversified guest experience with the amusement parks, water parks, resorts, campgrounds and safaris all in the mix. This industry, by the way, loves to sell season passes and the mergers should give Six Flags Entertainment a major boost year because season pass holders will have access to many, many more locations, especially now at the company plans to offer a combined loyalty program with additional parks. One or more basic level, the merger means that Six Flags and Cedar Fair can combine their best practices, especially on the technology front, resulting in a better guest experience all around. And that's why I'm thrilled that the CEO and CFO both came from Cedar Fair because Cedar Fair was generally regarded as the better operator of the two. On the other hand, Six Flags brings to the combined business some excellent intellectual property rights, including Looney Tunes, Peanuts and DC Comics. They can roll a Batman the ride everywhere now. How about the financials? At the same time with the deal announcement, both companies said they expected the deal would be additive to earnings within the first 12 months. They told us they'd identified $120 million in potential cost savings to realize within the first two years. And they also believed that the improvements to the guest experience will increase earnings for interest, taxes, depreciation and amortization by additional $80 million within three years of the closing. That's not that much, but it's still better than nothing. I was actually hoping that was the one line that I felt should have been higher. If you believe these projections, then the combined business should have ultimately had $3.4 billion in revenue, $1.2 billion in adjusted EBITDA, and over $800 million in free cash flow, it will have a cleaner balance sheet than Cedar Fair or Six Flags had on their own. Although Imagine says it can get a celebrity ratio down further from 3.7 to 3 within the next two years, and not conservative. Okay. We don't yet know what the dividend will look like as Imagineer said that it's prior charging paying down dead initially, but hopefully dividends and buybacks can be added to the mix down a lot. But remember what Cedar Fair had that great yield we used to talk about all the time. Given those numbers, the stock doesn't seem too expensive to me, even after the recent run. The analysts are looking for Six Flags Entertainment to earn $3.17 per share this year. According to $3.90 per share next year, that means the stock sells for $17.5 times this year, roughly $14 times next year. That's so much below the average stock in the S&P. I like that. Plus, I think it works thematically in this market. We know spending on travel and these are hasn't really gone away. Sunday was the biggest number ever, according to the TSA. Although many consumers are more value oriented going for bargain vacations like cruises. To me, Six Flags fits right in there as a bargain orientation. It's a trade-down theme park play. The place to go, if you don't want to shell out for a flight to Disney World, or those higher prices for rides. Last Tuesday after the deal officially closed, analysts at Oppenheimer raised their price target for Six Flags from $49.67. They think Cedar Fair's terrific executives can get a lot more mileage out of Six Flags assets, plus the old Cedar Fair part of the business already had a strong start to the season past selling season. So far, we've had nice summer weather. Oppenheimer is not alone in his polishes. All six analysts that cover the stock have a buy or equivalent rating on it. Average price target just above 61, up more than 10% from where it's currently trading. What can I say? When the consensus is right, it's right. Bottom line, add me to the list of Six Flags Entertainment bulls. Like I said before, I'm pretty surprised that the regulators allowed this one to go through, because they're skeptical of all mergers, especially ones that are being great for business. Now that the regulators have let it happen though, I think you've got a terrific investment. Sure, the stocks run substantially over the past month, but I bet it's got more upside. We have money is back after the break. Coming up, pop open those umbrellas and tee up your toughest questions. Kramer takes on all comers in the lightning round. Next. It is time to start the lightning round, come to us. We're about four minutes. Let me see what I've done. We know that the stock question is out of time, but step first, baby, you're gonna play this out. And then the lightning round is over. Are you ready? Skeet dead to the lightning round. Let's start with Bill. It matches his bill. Hey Jimmy Gams, how are you this evening? I'm having a dime of my time. I got my buddies out here on the floor, and we're enjoying ourselves. What's going on? I'm looking for strength in my position in some banking. I'm thinking of Morgan Stanley. No, no, Morgan Stanley's flew too much. I will be on it for the chat with Josh. Nothing against Morgan Stanley or Ted Pick. We're all the good people there. 102 we don't want to buy anymore. The only one that I would count is in that group that I would still buy is Wells Fargo with Charlie Shaw. That will be the stock goodbye. Now we're going to go to Mo in New Jersey. Mo. Jim Booyah. Thanks. How are you doing? I'm doing okay. How are you partner? Good, good. So I just started investing a little bit on my own, and I'm interested in what you think about Reddit because it seems- Oh, I want to buy Reddit. I think Reddit, I'm going to throw Reddit in Pinterest in. These are two stocks that people don't realize. These are like when you're going up, it's just three, six, and ten, and Philly. Suddenly 29 starts playing. 29 gets it and starts getting a little extra money. This is like the new channels. Both Pinterest and Reddit are new channels that are working. Let's go to Frank in New York. Frank. Yeah, Jim, Frank. Thank you, Michael. I'm doing my best. Thank you. That's what matters. Thank you. Over the last year, uranium has come into its own. And a lot of companies, you know, look, we have become a lot more popular. And when the uranium comes out of the ground, if I'm saying it's right, it has to be enriched before you can use it. And one of the two companies is only, maybe the only company which would put it in the catbird. See, it's centrist energy. What do you say? Okay, I'll understand. I am so pro-nuke that I'm going to speculate on a nuke, and that is one that I am fine with speculating. I think it's good. I understand it's a long-term situation, but I think it is good. And now we're going to go to Sean in California, Sean. Hey, Jim, how you doing? You buy your stick and the eagle get? You know what? I've been trying to figure out whether I should keep my 10% stake. That means 10% cheese steak that I bought at Gino's, okay? That's a good one. Hey, I'm calling about a company that's growing up. I'm calling on the top and bottom line. And they just instituted a dividend. It's reminding me of the Lulu case study on Timberland some years ago. It's Supergroup, SGHC. You know, I like Supergroup when it started, and you know, I kept thinking that it's a great entertainment and gambling company. I'm not putting it back away, but it's done nothing. Candidly has done nothing, and I don't understand the dividend. But yeah, I mean, that was one we had our agreement on, and I think that arc is a guy I revere great integrity, smart. I'm going to say I think that's a smart move by you. Let's go to David in Florida, David. So, yo, what's shaking partner? So, if you start to have been falling for the past couple of months, even though they showed dollar earnings, if you guys are packed, when is the cream of the crop, good time to buy? What do you think? Okay, so I think it is, but I got to tell you anything connected with China, whether it be Nike, whether it be Starbucks, whether it be wind, they are considered to be losers by the market, and I can't change that perception until we start seeing things get better. So, the answer is, yes, I want to buy it. No, I don't think you're going to make a lot of money in within a near term. Let's go to Alex and Louisiana, please. Alex. Who's not Kramer? And we all know cyber security is crucial for the national security. Yes. Especially to say I drew the narrow. By questions concerning Sentinel-1, they face tough competition from CrowdStrike, ones for strong leadership and brand recognition, and Palo Alto Networks offering extensive networks and pointed cloud security. I believe Sentinel-1 is trading out a significant discount with a kill of prices, cash flow ratio. It is, but it deserves a discount because it's missed the quarterly estimates. That's what makes me worried about it. So, I'm not going to say that that's wrong. I'm going to say that that stock is correct, he priced. And that, ladies and gentlemen, conclusion of the lightning round! The lightning round is sponsored by Charles Schwab. Coming up, don't touch that dial. Kramer has more on this market you won't want to miss. Next. When a stock declines to nearly 28% in a single session, you guys take notice. When it's a consumer packaged goods company like Helen of Troy with its Pestasia brands, ranging from Oxo Kitchen products, Hydro Flast, Drybar, Revlon Cosmetics, Brawn Household appliances, and Osprey Outdoor Gear, all pretty stable business lines. You know there's something very, very wrong. I want to put aside the company's specific issues to focus on the big takeaways from Helen of Troy's hideous earnings business. Historically, I've actually liked this stock for its consistency and its constant efforts to upgrade its portfolio of brands. Helen of Troy has only missed earnings estimates twice in five years, which is what makes this massive shortfall so extraordinary. What gives? Well, I want to quote CEO Noel Joffrey from her conference call. First, she says, quote, "The macro environment and the health of the consumers and retailers has worsened. Consumers are even more financially stretched and are even further prioritizing essentials over discretionary items." End quote. She then explains that there has been, quote, an unexpected slowdown in the global outdoor category, end quote, end quote, more pressure on the specialty beauty channel and mass beauty channel, especially in beauty tools under $100, end quote. And then get this, quote, "More discretionary household items like dry food storage continue to trend down. We've heard broadly from mass retail that traffic overall is slower throughout the country and promotional pressure is increasing." End quote. Ouch. Now, it's true that Helen of Troy's brands aren't necessarily the best in their category, but this kind of wheat this is due. And it's sudden, it's telling me that we've had a weaker spring than many realized, but simply, you don't need to buy anything that Helen of Troy makes. You put it all off. In every category, these numbers would indicate that's exactly what's happened. Remember, for the past couple months, I've been telling you about brown shoots, my term from nation's slowdowns, plus the economy, that will necessitate the fed to cut interest rates of the fall. We saw brown shoots in lower steel and number prices. We saw them in pool court, which is struggling to sell in swimming pool related wares. We saw them declining sales at Nike and it's Starbucks, companies that raised prices by too much during the last five years. We've seen it in weaker dining out, including quickserve. And we know the consumer package to its companies that have raised price aggressively are now on a pickle. They don't want to cut price, but they may have no choice if they want to stay competitive. Otherwise, big retailers like Walmart and Costco will do it for them. Yes, those two companies have that kind of power. They can drop your product or even go against you with their house brands. Costco's Kirkland St. Shobran is the unique premium house brand and Costco will unhesitatingly use it against you if you don't lower prices for your goods in their stores. That or the little limnature wears entirely. Costco is the greatest inflation fighter of our generation. Now, when Fed Chief Jay Powell spoke to the Senate today, his testimony was considered to be pretty dovish. Maybe he saw this slowdown unfolding. Maybe he's laying the groundwork for his temper rate cut. News like the shortfall from Helena and Detroit are in your face warnings that the consumer isn't just being frugal and stingy. The consumer is choosing to defer or avoid buying anything non-essential. Right now, the market's handling Helena and Detroit isn't. It doesn't matter. Hey, look, it's not a bank and cap tech name. So who cares? Maybe investors think that because America's had the biggest travel day in history just last Sunday, that people simply aren't spending on money on their hair, care, hiking, kitchen products because they're spending on airline tickets in hotel rooms. That's one way to look at it. But I think we have to start wondering if the decline of the consumer is accelerating. Maybe June, for example, turns out to be much weaker than we thought. Maybe this is simply the dark side of the soft landing. One thing we don't want though is some situation where we need to start foaming the runway before the plane lands. I've been in one of those landings. We all got out in one piece, but I don't want to experience another one if it can be avoided. And as long as things keep deteriorating, Jay Powell had the wiggle room to engineer the softness of the soft landing. So we'll couple of rate cuts this year. And increasingly, it looks like he's going to have to start in September. I like to say, there's a reasonable market somewhere. I've probably started finding just for you right here on Mid Money. I'm Jim Kramer. See you tomorrow. Last call starts now. 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. Want a website with unmatched power speeding control? Try Bluehose Cloud, the new web hosting plan from Bluehose, built for WordPress creators by WordPress experts. With 100% uptime, incredible load times, and 24/7 WordPress priority support, your sites will be lightning fast with global reach. And with Bluehose Cloud, your sites can handle surges in traffic no matter how big. Plus, you automatically get daily backups and world-class security. Get started now at Bluehose.com. [BLANK_AUDIO]