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 4/24/24
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From powering the light bulb to virtually powering our entire lives. 30 years ago, State Street launched the Spyder S&P 500 ETF Spy. A big idea that inspired the world to invest differently. And still does. What can you do with Spy? Before investing, consider the funds, investment objectives, risks, charges, and expenses. Visit ssga.com for a perspective containing this and other information. Read it carefully before investing. Spy is subject to risks similar to those of stocks. All ETFs are subject to risk including possible loss of principal, helps distributors and distributors. 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. Man money starts now. Hey, I'm Kramer. Welcome to Cramer. Welcome to Cramer. Other people want to make friends. I'm just trying to save you a little money. My job is not just to entertain but to educate to teach you. So call me at 1-800-743-CMC. Tweet me to Cramer. Cash? Cash is rock. Okay, we say cash is king when the market is so ugly that you just want to get out now. So, so, so, so, so, so. I can't endorse that here because I like the market longer term. But after a session with the Dow, dip 43 points, it has to be inch up 0.02 percent. Now as I can advance 0.1 percent, I'd be lying if I told you I'd feel great about this market. Let's roll it. Well, earnings tonight for one, especially the forecast. And we're going to get to those. But let's start with what I think is the real alpha in the room. Let's start with the bond market, which of course is much bigger. The stock market has always tell you and its power bleeds into the stock market every day and has been bleeding in a bad way. How's it do that? Simple. When the government sells bills, notes and bonds to pay for the deficit, it really weighs on everything. Consider it a gigantic side show that can really hurt your portfolio. Just this week, you've got to use $44 billion seven-year bond auction. That's tomorrow. On top of today's $70 billion five-year note auction, that's an awful lot of bonds supply, especially on top of the $69 billion sale. Two-year notes we got yesterday talking about cash is rock. The bond market now it's got so compelling to so many people, because it's been going down, that they want to buy some of these bonds, which means they often need to sell stock in order to swap out of that squeeze into the bond market. They have to raise cash to buy bonds. Makes sense, right? You need a lot of buyers to come in and buy these bonds because so much is being for sale. For many, that means to cash your stock in order to be able to buy the bonds. Now, I know that churches are risk-free terrific. If you think that the federal eventually cut rates this year, well, then the two-year, it was a really interesting piece of paper, around five percent. I bought some yesterday. Remember, I can't buy stocks. Two-year good, but how about this five-year note with a 4.6% yield that was today's business or the seven-year yield, seven-year worth it needs to be similar tomorrow. Sorry, to me, they are not real value. I want to hire you going out further. Others will, too, and if that's the case, then bond yields will have to move higher, price to bonds lower, okay, to bring in more buyers. The impact on the bond market and then the stock market would be immediate. In a world where long-term bond yields keep climbing, stocks will head down. Like they always do when rates go up. Even if rates are going up because of too much supply issued all at once from the government and not inflation and not because of a lack of demand by buyers. We had three big declines this year, all related to the bond market. The Treasury Department can't just use short-term paper, so it separates out the years and does it that way. But each auction has its own character. I wonder how many people tomorrow want to lock in at almost 4.7% rate for seven years. The one thing I do know is I can't gauge that. What it means is you got a total wildcard, right? A total wildcard in a bond market that can impact stocks, bonds need to go up in price and down and yield with this heavy schedule of bond issuance. I think we're going to get the opposite of that. That makes me concerned, which brings me to the second reason why cash is rock. There are plenty of stock people who only believe that the only thing that matters is earnings. Earnings truly matter more than anything else. If earnings are great, then stocks will go up. And very often, that is true. A bunch of stocks have done well after putting good numbers at earnings. They last night, Texas has been sitting in an inventory of some types of chips and five have been worked off. There have been a big lot in semiconductors for the auto industry. With that glut worked off, Texas and stock exploded hard today. That sent up the other auto-related chip makers like on-semi-microchip. Okay, I get that. Tesla stocks just hit the whole year and looked like a death spiral. However, when Elon Musk told a good story about how to have cheaper electric vehicles and a viable plan for robo-taxis, people went nuts and the stock sat up 12% and you knew he was going to do that. He did pull a proverbial out of that hat like I told you. Although, Tesla's actual numbers were suboptical. Musk is a great pitch in these cities. Wow, is he a compelling salesman? Nothing out of that. But these winners feel like they're one wolf to me. I don't know about you. And there's no doubt in my mind that if we get a sloppy treasury auction tomorrow, then these stocks will give up those gains. By the way, I also see Meta and IBM got a great deal in after hours. I know that Meta's quarter was strong, but the guy was weak. Well, in that in a second, it could be an opportunity if he gets hit too hard, even though it's way above my basis for the travel trust. Now, I feel more bullish if the market were what we call oversold. But my gauge that I use is called the S&P short range oscillators from market edge and it is barely oversold at -1.66. -5 means there's too much selling pressure and we are due for a bounce. We're no year, nowhere near that. We don't have that situation. That means, you know what, we don't have the wind in our back. Cash would be king if we were overbought right here. We can't be that negative for the market somewhat oversold, hence why cash is still rook. All right, let's talk about Meta because that's all anyone's going to be talking about tomorrow. I can give you a preview. The actual quarter is very, very strong. Sizable sales and earnings speed, healthy advertising numbers, solid 7% user growth. However, the stocks are getting eviscerated in after hours. Sell, sell, sell. Because people didn't love the guidance. Meta's second quarter revenue forecast was a little light and their full year capital expenditures are going to be much higher than expected. I think these investments are justified. Mark Zuckerberg knows what he's doing, but it's not what Walsh who wants to hear in this environment. It's a skittish environment. Now, you can see how Texas Instruments and Tesla can rally on news that there's better than fear, even though Tesla had negative free cash flow to the tune of 2.5 billion. Musk is a showman. He was very convincing that his robo-taxi service would be like Airbnb. They need some of them and you can stay in them. I like this elevator analogy too. At one point, they were professional elevator operators. You tell them before you wanted to go on and they'd stop there. And then we collectively decided to just let anybody push the buttons. Everything changed. Could be the same with taxis. But even as there were some winners today, there are also plenty of companies with stocks that look like they're going great guns only to get crushed in today. Let me give you an example of Boeing. Now, this stock opened up. Well, I was there. We asked Dave Calhoun questions this morning in the school industry. And they're mixed emotions. Stock opened at 176 and that was up. That was more than seven bucks above yesterday's clothes. Whoo! Despite the fact that the quarter was truly nothing you're right home about with extremely negative cash flow. Kind of like Tesla. And no real sense of what management can write the ship. In a good market, Boeing stock would build on that advance. In a bad market, it purewets and goes straight down. The latter's exactly what happened. I need you to get into the heads of the people who were buying when Boeing opened higher. They didn't care where they bought it and they got picked off. They're now natural sellers. I see stocks like that all over the place. Real landmines everywhere. You look, take new court, which we had on last night. I find the best deal company in the world. I, though CEO Leon Topali, told a good story about how his company missed the quarter. To me, Leon clearly felt better than any missed guidance. And I think he'll be able to straighten it out fairly soon. But he said that the next quarter will be weaker. Here's the problem. Too many buyers agree with me. New court's stock opened at 175 and got real positive, ran up to 178. But then, like Boeing, the stock pirouaded and fell to 172. Because remember, the quarter was truly disappointing. Only a treacherous market has that kind of action, though. And I don't like treacherous markets. Finally, we had our monthly investing club meeting this morning at noon today. It's the one you can go listen to it. And as much as I want to think that I like all the stocks we own for the child will trust us, connect it to the club, I found myself couching and hedging and crushing about so many stocks over the near term that it was quite chilly. When you own more than 30 stocks, you can only recommend a half dozen stocks to buy at this very moment. That's the ultimate sign that cash is rock. It's not king because there's still some stocks that are worth buying right here. If cash were king, you'd be selling and selling and selling. But too few of them right now that justify buying handover fits. So let me give you the bottom line. We've been in the sell off for over a month. And I still think it's a dice your time the most investors seem to believe as you would get if you looked at meta this evening. That's okay. We have cash for the child will trust. I hope you have some too. Cash may not be king right now, but it certainly isn't pawn either. I want to take calls. I'm going to go to Austin and Massachusetts, Austin. With McDonald's coming in at 300 starting the year, and now I think it's just around 270, what can we see coming in like that? This is Austin from Westfield State. Shout out Dr. Fiore. Okay, terrific. Now, we know Chipotle had good numbers, but I have to tell you, I think McDonald's offerings are too expensive. They raise the prices too much, and they've got to cut the price. And nobody wants to have to cut price. But to me, the stock is signaling they need to cut. They raise the price too much. They got to bring them down. Let's go to Arthur. My home state of New Jersey, Arthur. Hey, Jim, how are you? I am good, Arthur. How are you? I'm great. Jim, I just want to say thank you, man. I've been following you for the last 23 years, and I'll tell you, you are all point with so much. I've made a lot of money, and I lost money because I didn't listen to you. Oh, you're very common. I've made some good calls as a bad call, so all I want to do is have the good calls outweigh the bad calls. Let's go to work. Okay, listen, I bought my durna at $369 a spirit, and it's killing my portfolio. I've been holding on to it for a while, and I said, okay, it's going to come back a little, then it's not coming back, then it goes up, and then it goes down. Jim, what should I do with this? I hate to take the law, because it's a big law. I know, and we should never care, though, about where stock came from. We got to care where it's going to, but I agree with you. The donor has special technology. I don't want to lose the stock here, but they announced a collaboration this morning with OpenAI, and I thought that the stock was up eight at one point, and you get it right back down. There are sellers everywhere in Mojourna. You're going to have to wait until they really do invent the personal vaccines that they promised when they started, and I'm talking about on mass vaccines, but thank you for your kind words. All right, cash may not be king right here, but it certainly isn't born either. Well, man, tonight, going down, that's what the stock of Otis did today, after earnings. So, our investors getting a viable dip in the elevator, later I've got the CEO, then the legendary Larry Williams is out with a bull call, where the market could be hit. I think you want to know what he's saying. It's all the technicals, and in order to say we convened our monthly meeting for the CMC investing club members, and we had so many incredible questions that we saved some of them for tonight, and yes indeed, if you read your names, you don't want to miss it. 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. Take your business further with the smart and flexible American Express business gold card. It's packed with benefits to help unlock more value from your business purchases. That's the powerful backing of American Express. Learn more at americanexpress.com/business gold card. When you're hiring, the best way to search for a candidate isn't to search at all. Don't search. Match. With Indeed. Indeed is your matching and hiring platform with over 350 million global monthly visitors, according to Indeed data, and a matching engine that helps you find quality candidates fast. Use Indeed for scheduling, screening, and messaging to connect with candidates faster. Plus, 93% of employers agree Indeed delivers the highest quality matches compared to other job sites, according to a recent Indeed survey. Leveraging over 140 million qualifications and preferences every day, Indeed's matching engine is constantly learning from your preferences. Join more than three and a half million businesses worldwide that use Indeed. Listeners of this show will get a $75 sponsor job credit to get your jobs more visibility at indeed.com/madmoney. Just go to indeed.com/madmoney right now and support this show by saying you heard about Indeed on this podcast. Indeed.com/madmoney. Terms and conditions apply. Need to hire? You need Indeed. All right. Here's a question. What do you give with the stock of Otis worldwide? The world's leading maker of elevators and escrowers, which also has gigantic service and repair business. This morning, the other is reported before the bell, and the numbers weren't what some people say mixed. Remember, it came in a bit lighter. It just came in a bit better than expected. Magna raised a full year earnings forecast, but the stock got hit, though, down more than 4%. I think it was because we had some costary comments about China, maybe where the company lowered its full year equipment sales outlook, but it really wasn't all that bad. Hey, maybe you're getting a good entry point here, or do we need to be more worried about China or North America for that matter? Let's take them with Judy Marks. She's the chair, president, and CEO of Otis worldwide. You get a better sense of the quarter and what comes next. Ms. Marks, welcome back to Magna. Hi, Jim. Great to be with you again. Okay. Well, I have to tell you, I am a huge student of what you report, and you deliver what you say you're going to deliver. And I think this time, because you did that, it wasn't enough. Maybe you've just beaten the numbers too often for people to not expect something really huge from you each time. Well, thanks, Jim. It's not about beating numbers for us. It's about executing our operational strategy, and really this quarter delivering for our customers. Service-driven business, top line up, 3.8% organic, 6.5% from our service business, drove about $50 million a profit, 80 basis points of margin expansion over an already strong quarter last year, which drove EPS up 10% to 88 cents. And then just as important, we delivered for our shareholders, Jim, and that's our capital strategy. Bought back 300 million shares in the first quarter, increased our outlook for the year now to a billion, as well as last night, we raised our dividend almost 15%, which has doubled our dividend since we spun. So really pleased with the results, great performance by the team. Yeah, we should talk about the dividend. There's only been a few dividend booths that were bigger than yours. How do you go about choosing that number? Because that's hefty, and you've already done what I think, look, our viewers really want us that dividend. Obviously, it's very important to you, too. Yeah, it's very important. And we try to target about a 40% ratio, which we think is about the right place. And we'll grow past that as earnings continue to grow. We've driven earnings ever since we spun, and we're going to continue to do that. And that's why we raised our guide. And we increased the low end of our EPS outlook for the year from it's now 383 to 390. And obviously, as the service business modernization repairs grow through the year, we'll continue to revisit that. We're starting to see many different grades of steel come down in price. Obviously, your input costs are going in the right direction. They are. I mean, steel is 80% of our commodities. We've locked in 80% of our steel for the year. The biggest place that helps us is primarily in China, as well as in North America. And we've been taking advantage of that and offsetting any other labor costs, any other challenges in the market. But we're getting price, Jim. So we're going to exercise everything we can to reduce costs, to drive productivity, as well as getting price on new equipment and surgery. Now, there was a critical moment in the conference call, which was, I think, actually like a false negative, where there was an analyst not going to mention his name. It was begging you kind of to call Troft in China. Now, you know China in two different ways. One, you know it in the elevator business, but also you know the country. I felt that your answer was correctly circumspect because there are major issues in China that really don't have anything to do with elevators, right? Yeah. So the China market is still is 10 million of the 22 million elevators in the world are installed in China and need service there. Right now, we're experiencing it. It's year three of confidence, liquidity challenges with the developers and consumer confidence. So I'm not going to prematurely call it Troft. When we see that part of the business turn around on the new equipment side, on the building side, but I can tell you having been in China just last month, there is still urbanization going on. There's still construction going on and there's even more service repair and modernization. So China up to us has become more of a service business. Jim, you've said it before. It's all about service and safety. Look, I just think that people don't seem to understand. I mean, I've been in a business where I had to worry about the service to safety. There is no skimping on safety and that's in any country. It doesn't matter how poor the country is. The way your government loses its standing is if you don't care about safety. Yeah, you have to care about people. We are in a regulated industry has been since since the safety break was invented by our founder. And because of that, people trust us and 2.3 billion people a day use our equipment, Jim, and there's 22 million elevators in the world today. It's a great opportunity. Again, needs technology refresh for the aging elevators. We call that modernization needs replenishment there. That markets grow. I'm going to grow at least high single digits everywhere. Okay, let's do talk about orders. It's only fair. Let me talk about we were more than you had the double digit decline in the Americas and high teens decline in China. Do I have to worry about the Americas? Now, America's for us was a compare. We had some great large infrastructure winds in Canada. Same quarter last year. We saw in this quarter a second half of last year construction slowed down a bit. All the indices would indicate that, but we saw it slowed down less this quarter. So, we believe it's turning, it's not growing yet, but it's turning in terms of new equipment construction. But, you know, we started the year and we said it was going to be a down year. It's playing out exactly how we thought, except with China being a little more down. But we had called out that the units were going to be down. We're not worried about North America. We've got a great new product that we're shipping now called our Gen3 core covers 80% of the market. So, we're looking for America to have some strong and our America's team, Jim, 15% up in revenue this quarter. So, we've got backlog. We're working through it, whether it's new equipment, repair. Our teams are dedicated. They're serving their customers and North America is going to be fine. That's good. Okay. One last question. Secretary Blinken is over in China and I made some comments this morning though. I think it may have been a little too flip. I said, I don't know what they have to talk about because we obviously just play horrible and everything. Are there things that we discuss with China that are, I don't want to say convivial because it's not like that, that are work been like, that are about business and getting things done that are not contentious? Absolutely. When I was at the China Development Forum last month, it really was about economic development, foreign direct investment, and how can they create an environment where American companies can do business. Elevators are not national security. They're here to move people safely throughout the world, including in China. And we're proud to have been, we're going to be celebrating 40 years in China this fall, Jim. It's an important business to us. We're proud of our team over there and we're going to continue to pivot more and more to service and modernization. Hey, our mod orders in China and our mod sales are up double digit. Our mod orders for the quarter globally. We're up, they're almost 13% and we've got a 15% backlog. So the business looks good. It's the years playing out as we thought. We did a little better on EPS and we flew it through. All right, good. Because I think those were some faux brown shoots. I see green shoots with us, especially with modernization, which is just so important. I want to thank Judy Mark's Chair President, CEO of Otis Worldwide. And by the way, forgiving is something that's positive. And the day we're all I hear about is that we never do anything good with China. Thank you so much, Judy. Great to see you. Take care, Jim. Come back here for the break. Coming up, do the charts tell the tale of a sell-off to come? Don't be aware. Be prepared. Stick with Kramer. You seek the key. But first, you must learn the ways of precision, craft, and performance with Acura's all-electric ZVX, with a premium bang and all-of-sen sound system up to a 313-mile range and a Type S variant with an estimated 500 horsepower. The ZVX is their most powerful SUV yet. Unlock the energy when you visit acura.com to order yours today. This week, the mark has finally been able to find its footing after the brutal sell-off that got rolling in mid-March. Whenever the average managed to rally in the face of what's been in a really ugly tape, you got to wonder if it's for real or if we're simply taking a little breather before the beating continues. And moments like this, you know, what we have to do, we have to consult the technicals, because they can tell you a great deal about the dynamics of the decline. That's why tonight we're going off the charts, but the help of, yes, the legendary Larry Williams, technician, marketer, story, who's been the best in the business since I was still going through puberty, puberty. Larry's written more than a dozen books. He's created a ton of proprietary technical indicators. He's my go-to guy, and he's got an amazing track character in both now and for many, many years. Hey, look, for us, he called the huge bottom, October 2022, turned out to be the game changer for the market. He predicted the next major light higher last fall, but most important, back on March 5th, Larry warned us that both the NASDAQ and the S&P were about to get the full blue chimney of treatment. Yeah, shoved into the wood chipper and cut the pieces. Like Fargo. Specifically, he predicted that the market would start to get hit around mid-March, and that things could get very ugly, possibly through late May. It's short, he told us to prepare for meltdown and melt them, frankly, is what we're getting. So now that we were started getting used to the plane, what comes next? Let's start with the NASDAQ, all right? Remember, Larry likes to come up with cycle forecasts. That's the crux of his analysis. He looks at the general path of a given security for, say, several years, and then he identifies patterns that seem to repeat themselves over time. If you ask most economists, they say there's no way this kind of method can help pick winners or losers, at least in theory. But in practice, it's surprisingly reliable. At least Larry Williams is the one doing the analysis. Check out the daily chart of the NASDAQ with Larry's cycle forecast in red, okay? Yeah. This is the picture he showed us in early March, just allowed him to call the bottom, and get this. His work showed that the NASDAQ would likely peak around March 15, and then you had to get out. I mean, like, out of dodge, like, big time, because this was going to be an extended period of week. So far he's been dead right. I had a little bounce, like yesterday, but what does Larry's cycle forecast say now that the client's already upon us? Take a look. Going about the cycle forecast, the historical pattern he expects to see lower prices for the NASDAQ into May. Ouchy. That's what my kid used to say. That's why Larry says not to take this week's rally too seriously. In other words, yesterday, no, take that bounce. It didn't do any of these values likely to be short-term until we reach over May. Now, that's something I agree with. If you're listening to our rather plane of investing club meeting this afternoon, I think you'd say, "Wow, Jim's really on the same team as Larry. I did not look at his stuff until I did my stuff." He recommends waiting to buy until we get to that zone of historical safety. And I'm coming around to his view. How about the broader S&P 500? Okay, back on March 5, Larry showed us his chart of the S&P in black and his cycle forecast is red. Again, he was looking for a peak. This time a little earlier in the month, followed by a lengthy slide. Again, right. So what might be the next length for the S&P? Check out the same chart through yesterday. This time it took a little longer for the S&P. There was a lag of a few weeks after the cycle turned negative, before the index finally started rolling over. But in the end, Larry was right, and the S&P got obliterated in the last few weeks. Again, though, if you're looking to buy only just the cycle forecast says it's probably not safe until May 20th. So there could be a little more pain here than there would be in the NASDAQ. And that's why Larry thinks you shouldn't get too attached right now to this week's rebound. And look, we saw some... Yeah, just think about what we've seen tonight. The meta gets traded to IBM and gets there. Yeah, there's real weakness out there. Remember, I keep telling you. I mean, I don't understand. The economy is weaker than people think. Larry warned us about in video on March 5th, too. Wow, this is close to home. It's just a few days before a peak. Take a look at what he showed us back then with the cycle forecast. He was predicting a meltdown starting around March 12th. Well, that was wrong. It was March 8th. Even though Larry says the video follows a different cycle than the S-spear, the NASDAQ, that cycle was indeed about to turn negative. Wow. So what does he see for NvidiaX? Take a look at this up-to-date version of the same chart. You can see Nvidia fell some 200 points, okay, in line with Larry's forecast. And his current projection suggests the stock will experience more weakness until mid-May when he expects to rebound. That's it. Larry also sees the temporary relief rally coming in the near future. Hey, maybe it already got started. I don't know. This is very important. This relief rally. You know, I always say own Nvidia. Don't trade it. But you know what, I agree that things could stay ugly for weeks now that the bomb mark has created an environment that's much more hustle and gross stocks. That's been my view. If you are nimble out there and you believe in Larry's work, then you should sell Nvidia into that bounce. And then maybe you could buy it back. The trust that we follow with the CMC Vesicle, we're just not that nimble. So we're sticking by our position. Hey, speaking of bonds, Larry points out the best moments to buy the averages come when stocks are undervalued versus high-grade bonds. So we'll get this chart of the E-mini Dow Jones industrial average, specifically the June futures contract. See the bull at the bottom? That shows how the Dow's trading relative to high-grade bonds. And it's still some distance away from where it has to be. This would be undervalued territory. So we're not there yet. Now if you look at the history, the Dow got cheap relative bonds back in October of last year, which is where we bought them, and then we got the big rally. It's got undervalued relative relative bonds in October of 2022, as well. Again, he killed tremendous rally. And sure, if you wait for the Dow to get cheaper relative to bond prices right here, okay? Larry says you'll typically get better buying opportunities. Why not get better buying opportunities? I mean, if history's any guy, he's absolutely right. Why force it? Here's the bottom line. Back in early March, Larry Williams called the recent stock market meltdown, especially in the NASDAQ. His cycle forecast analysis showed that we were headed for a nasty and prolonged sell-off, dead Roy. Now the same analyst says, not to let this week's rebound, particularly yesterday's week, we about get to your head. The charges delivered by Larry suggested we've still got a few more weeks before we can call bottom for this, put them for the NASDAQ. I would not bet against him on this one, including NASDAQ, including NVIDIA. And for now, why? Because it makes too much sense for me. Let's take calls. Let's go to Jack in Texas, Jack. Hello, Mr. Kramer. Thank you. First, thank you for your work that your team and you do for its home investors. Thank you. I have positions for many years in both AMD and NVIDIA. Due to their great performances, they have now significantly outsized positions in my portfolio. I have a high-risk tolerance, but I need to take some off the table. Which should I trim, why, in any box, in any new positions? Thank you, Jim, for all of you. Jack, first of all, thank you, Jack. He poses an essential point that I try to teach in the investing club. There are two things that you need to know. There are something called discipline and something called conviction. If you love a stock and think it's great and the company's doing great, that means you have conviction. But there's also levels of discipline, which means that if you own too much of one stock and it's gotten too big and it's swinging around your portfolio, you must use some trimming even if you have conviction. For instance, I think that Jack should sell a little AMD and a little NVIDIA. Yes, I'd say don't own, don't trade. But if those positions are too big and his whole fun portfolio is moving to them, then what happens is conviction is trumped by discipline. Thank you, Karen Kramer, for drilling out in my head and often putting it on my forehead when I had something that I really liked and it went down because she said you're an idiot. But that's okay because you know, well, I was. Okay, let's go to Ron. Let's go to Ron in California, Ron. Who, yeah. Who, yeah. He's a gamer with a cake calling from Southern California, a first-time caller, founding member of the investment club. Bingo, let's go to work. Hey, the stock chart on this one is not so hot and it's reporting first quarter results on May 7th. Question, buy more, sell, or hold oddity? I knew it was one they did or they liked our show and they were like, just some style. It didn't deliver. Look, we got two, we have Elf and Elf is doing a great job and then we decided for the travel trust that we were going to buy when it went all the way down some estate order. Now, let's do orders after the faint heart, okay? But those are the two that are right. estate order better do this quarter because it's been not good. But Elf, we just had Tarago Meanen and he just said it's doing really well. That's the one to buy even though the stock's up a lot. All right, listen, the charts interpreted by Larry Williams suggest that we've still got a few more weeks before we can bottom. Hey, judging by what's happened with Medi, you got to believe he's right, huh? I wouldn't bet against him. Now, as much more Med money had, we had so many great questions sent in for April's CNBC investing club meeting that we had today that we figured we answered some of them tonight. I'm giving you a sense of the rigorous work that Jeff Marks and I do in the club and we're going to hear what's going on in your mind. Man, we've been looking for brown shoots this morning, right? But now we have something to be aware, false brown shoots. I saw one today that really made me angry, a heavy steam that I think investors need to be aware of. Of course, oil costs, rapid prices, and it's just a lightning round. So stay with Kramer. Okay, so earlier today, we held our CNBC investing club monthly meeting. Once a month, we get together, Jeff Marks and I, and we run through the thought process of how we make decisions. Then we discuss our current holdings, and then we take questions from club members. Now, I always say my favorite part of these shows is taking your questions and we always have more questions than time. So as I promised in the call today, I'm going to give you an inside look at what we do in the investing club and take more questions from club members. So you got your chance. I know people love to hear their quick. I never mind it. I don't blame you one bit. You want to hear your name on TV, whatever. It's nice and I like to be nice. Okay. Now, if you like what you hear, now is your chance to join the CBC investing club. Plus, we have a limited time offer happening right now. Take advantage of it and get exclusive member benefits, my daily market strategies and more. I want you to head to cnbc.com/flashclub for the offer. And look, I've been doing this kind of reading saying buy it, buy stuff that I have for like 25 years. It always sounds kind of like cheesy. I'm sorry. I don't know what else to do. I really believe in the club. Okay, there. Now let's get started. Let's go with Cynthia in Georgia. Jim, I was hoping you would guide us regarding the GE spin-offs. Do we keep all the parts or is there any one part that you don't recommend? Hope to see you in person one day. I do too. Is it land on your calendar? I sure wish it was. But whatever you get there, I love travel. Okay, here's the issue. I actually like all three, but I'm going to rank them. First, I like GE health care. Why? Because I like the long term strategy that they have to be able to have artificial intelligence in their MRIs. Secondly, I like GE airspace. It would be another time when I would have put GE airspace ahead of GE health, but I can't because the airspace has run so much. And then I like Vanova the third. Now, I don't want to buy, by no means do I say not own Vanova, but Vanova's wind. And sometimes I think that wind could be tough because I don't think everyone wants windmills next to them. So that's the order. GE health care, then GE airspace, and then GE Vanova. All right, next up, we have a question from Cindy. Who wants to know, is it too early to invest in a copper stock? Well, it would be your advice in this area. The only copper stock I ever recommend is Freeport. I do not like copper. I think copper is too levered to China. We happen to be listening. I happen to have done a lot of work with Judy Marks from Otis. She knows more about construction in China than anybody. I don't like the construction scene, although 250 million people are moving from the country of the city. I just think that copper, which is so levered to China, is not where I want to be right now. One time it's levered to America, and I'm more. Next, we have a question from Mike, who asks, I am kind of getting back into aerospace defense stocks like RTX, Lockheed Martin, Northrop Grumman. Do you have any recommendations here? I thought that the RTX quarter was just magnificent. Now, it's Gray Hayes, and he's departing. I'm sure he's got a good team after him, but RTX had just a remarkable quarter, and they had that problem with their gear turbofan, but it was a construction problem. It's completely solved. It's not like Boeing, and they have a great balance sheet, and they have Raytheon, and that is the one you want. It's Pratt Whitney, just you know. Next up, we have a question from Brad, who asks, when the market is run and you're up nicely, I know you taught us to take some profit. Bull's make money, bears make money, pigs get slaughtered. My question is, you ever take profit when your core recipe 500 holdings are just the individual stocks. Just the individual stocks is the answer to that. Now, look, I have been in the market through thick and thin since 1979, and for the most part, I let everything run. Because I did, and I can't earn individual stocks, remember, individual stocks, that's the profits that people have done. TV shows are talking about stocks, but it's been right. Sometimes you have to take pain, and people don't like to take pain, but taking pain is what got me to Apple at this point, it got me to NVIDIA at this point, and I know those stocks are going down right now. I don't care. I'm going to ride them, because I believe in them long term. Next, we have a question from Brian in Florida, who asked Jim and Jeff, Jeff Marks, my partner, thank you for everything you do. You often talk about the bond market, but what is the easiest and quickest way to keep track of the bond market? As a newest investor, I struggle to understand that CBC.com has great indicators about the bond market. It's got everything you need, and I don't want to send anybody to anywhere else, because that's how good our bond information is. By the way, CBC.com, it's an undervalued site when it comes to all sorts of things. Go there. I go first thing in the morning. Now, let's go to Kevin, who wants to know, is it time to buy the battery Boeing or United Health yet? They seem to be in the same category right now, solid company believer by legitimate concern, but still good long term investment. These are two very different companies. Now, Boeing only has one competitor, which is Airbus, but I am a balance sheet fanatic, and the balance sheet for United Health is really good. They did have that terrible hack. I think that they under, they did not report the hack in time. I didn't like that. I don't really care for that industry. You manage, pull its forecast, so I'm going to say this. I don't want you to buy either one. Why don't I have to make it either or? If you put a gun to my head and say, "Which one do you pick?" I say, "First, take the gun away from my head, and second, don't buy either." All right. Next up, Thomas in Florida wants to know, "When is it okay to violate your cost basis?" Let's say I'm up 30% of stock. I want more shares, but not sure being up 30% is a good time to buy. Okay. We do have special situations in the club where we periodically say, "All right, here's the stock that we really like. Our basis is very, very low. I'll give you a good example." Okay. Let's say we study meta. We have a really low basis of meta, and we decide that we have to pick up some meta because all that's happened is that Mark Zuckerberg has so-called sandbag this. In other words, the stock is down because he's given a really dire forecast, even though the company's doing well. That would be an example of when I might be willing to violate my basis, because it's so far down. But it takes a lot of discipline to violate basis for me. And I don't like to do it because I can show you chapter and verse. I've been doing this for 20 years with this channel for trust. There are so few times that violating my basis, it made me money that I tend to just say, "Forget about it." Now, let's go to Chris in Colorado who say, "Would the club consider adding a reap to the portfolio, increase the portfolio's diversity? If so, would the timing be related to interest rates coming down due to the Federal Reserve cutting rates?" Yes, it would be related to the Fed birthing rates. The ones I am interested in, I'm very interested in Simon, I'm very interested in Tanger, I'm very interested in Federal really. All three of those work for me as situations that I might want to buy. All right, thank you to all of our fantastic club members who are standing in the questions. I mean it. I'm going to say a couple of things that are kind of hokey, right? One, yes, I did have to recommend buying it. You can say being a member of the club. You say, "God, Jim's really shown for the club." How about this? Jim spends much of his life working in the club so he feels proud of it. How about that? Second, I do like reading your names. I like to see you on this treat. Why? Because I'm like just another guy, okay? And if you like this stuff and you like what I do, I am thrilled, okay? So I hope you sign up and make money is back at food break. Coming up, hit us with your best shot and electrified fast fire lightning round is next. [Music] It is time to have the light round. I'm going to use him to start the tip of the above. I'm going to put it around the floor so I'm going to do it by simply the way. You bling some. And then the lightning round is over. Are you ready? Steve, thanks. I'm going to light round. I'm going to start with Tim in New York. Tim. Hey, what's up Jim? It's Tim from New York. I'm calling about the stock cloud flare. Considering if exposure to AI is now a good time to buy. Matthew Prince rocks. I would be a buyer. I would buy it slowly because we got big selling going on in AI stock meta. That's how I regard it now. I need you to go to Chris and California, Chris. Double bull yaw bull yaw Jim. Thank you very far young investors. We appreciate you. Do everything I can man. It's a tough market. What do I got here? I found in the five. Oh man. Do you know I just said to Jeff Marks and Ben Stoder today that Axon is so good. We used to have Rick Smith on all the time. Remember that wasn't a taser, but it's really just an ecosystem of more enforcement. And even here it's still good. And you go to Mitchell and Texas Mitchell. Jimmy Choo, what's up? I don't know. You tell me. Make it better after you hear this story. Jimmy, I got a stock that's trading at the average market multiple. Right now let's say 20, 23, 22. And the stock is going to clock Drupal and earn it over the next two years. What do you think about first solar? Oh, I like first solar. It's actually the only solar next tracker that I really like here. The other ones are all kind of like their faux solar. I like that faux today. All right. Let's go to Mike in Illinois. Mike. Hey, Jim. How are you? I'm doing good, Mike. How about you? I'm doing well. I know you have Coteira and you were maybe considering some other stocks and energy. Want to know what you think about this stock. It's the number one stock in its sector. It's uh it's uh it's in Mexico. Mr. Vista oil and gas. Mexico is actually changing its rules. This should be I think good for Vista. I would actually own Vista. I think it's a good situation. Let's go to Liza in New York. Liza. Hi, Kim. Long time listener and second time caller. Perfect. Let's go to work. Should I be patient with Crown capital? CCI. I think it's six and a half percent yield. They are if they've been this managed, you betcha. Can they bottom here? I think with that six and a half percent yield they can. It's not a totally bad business. It's kind of a you know it's a tower business. Uh it's not that much worse than all the rest. I think you're okay. Let's go to Charlie in California. Charlie. Hey Jim, I mean I um recently I bought into an IPO. I'm up 15 percent on it. The stocks at Sarah Labs so I hold by more. No no you want to take the game here. I don't tell you why. Because we got a level of IPOs coming your way. It's going to make everybody sell these to buy the next IPOs. I don't want you to be caught in that mail strum. Let's go to Carrie and Pennsylvania. Carrie. Hey Jim. Hey Carrie, what's going on? I was wondering if I should invest in Laquidia. Laquidia. Laquidia. Laquidia. Um okay let me think there uh when this is whoa uh look this is so speculative. I don't know man. You're rolling you're dice rolling here with this thing. You're just dice rolling. I'm not going to be in the dice roll game. It's too hard. And that ladies I'm a good one. Light it round. The lightning round is sponsored by Charles Schwab. Coming up from railroads to tech Kramer is looking for a bargain. Where's the next bull market hiding? Find out when we return. [Music] I'm going to look out for weakness because I think that March was not a good month for the economy. Which ironically a good thing for the stock market. Remember we need brown shoots signs of newfound weakness so that they can justify cutting interest rates. The last time we heard from the Fed they were upset that the economy remained too hot. Today though we got a few more brown shoots than we bargained for. First the very reliable Norfolk Southern missed estimates. The company actually pre-announced soft numbers early this month but perhaps they wouldn't notice. Or maybe they thought they were sandbagging because the consensus estimates didn't come down enough and today they disappointed investors again. With the poor poor. That stings especially if Norfolk Southern came on the show less than a month ago and see if my gold systems go. But hey things happen. Now I always like to buy the rails at a discount. They're among the most reliable regular earners. Kind of like Ralph from the Sopranos. But I don't know about this one. One Norfolk Southern made a settlement for the East Palestine train derailment. This was still a down quarter for both sales and earnings. I was surprised by the weakness and intermodal and coal. If they kind of were really strong those two car guys would have been much better. There's a reason Norfolk Southern stock was down 3.6 percent and it wasn't because they had an upside surprise because it didn't. Worse we got an in line number from Old Dominion Freight. A truck or a net in a stock drop by $24 or 11 percent. Brown shoots galore or maybe overreaction but it doesn't matter. It happened. We've now seen wheat just from JB Hunt. Norfolk Southern Old Dominion. These transports are the backbone of the economy and there are so great predictors. At the same time we need to beware of false brown shoots. Today we heard from an analyst who covers Apple and said that Division Pro is a big disappointment. What happened? The analyst said that Apple's not going to be able to make the consensus estimates of 700 to 800,000 vision pros. They cut the numbers to between 400,000, 450,000. He said wow. Oh wait a second though. We looked up what the analysts were expecting back in February when it launched and back then the analysts only figured out what sell 400,000. Talk about faux brown shoots. That's outrageous. What a straw man. If Apple can sell 400,000 units up to 35 another product that just now has the software written for it. I think it's doing great. Right now the Vision Pro is being marketed as a consumer product without a subsidy from a consumer company like an iPhone. You get with the iPhone. That's a steep price tag. We know that. But what if Apple pivots and decides to market this thing not just as a consumer product but as a business product? Hear me out. When I was at NVIDIA GTC conference, I got to sit in a Nissan sports car, check out the dashboard, jumped out over the rocker panels, kicked the tires and looked under the hood, barely missing my fingers when I closed it. The only thing is there was no car. It's all an illusion, generated by a Vision Pro hooked up to a NVIDIA supercomputer. I was sitting in a chair in an empty room. Last week I was at a car behind a dealer. I went to the used car vending machine to simulate carbine. I found myself thinking that it would have been a heck of a lot easier if I had a Vision Pro and picked a car from that. I'd love to do the same thing with a house. Walked through the house with my Vision Pro. More important, I bet the best use for this thing is industrial. If everyone is constructing a building where the Vision Pro, things would go much more smoothly, at least according to NVIDIA's TensorFlowm. The construction of factories largest business in the world. If you could cut waste and test out potential changes on the Vision Pro before you put them in reality and it's what's known as a digital twin, and I'd say that 30 $500 price tag is way too cheap. No matter what, I'm cool at finding real brown shoots like the transports which are great predictors or future commerce. Those brown shoots say we might finally be cooling down in the economy just when people thought it was not, and that's one day how we'll get a bottom. But bogus green shoots in tech, I say give me a break. Like I said, as always, the bull market's summer. I promise I find it just for you, ready to admit money. I'm Jim Kramer, see you tomorrow, last call starts now! Holy 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. 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