Stocks discussed on the in-depth session of Jim Cramer's Mad Money TV Program, Thursday, August 16.
The market rally on Thursday will last a lot longer than the bears think. There was positivity in the market after resumed trade talks with China. Cramer said that low profile talks are better than no talks. The breadth of Thursday's rally included financials, tech and industrials - a healthy sign for the overall market.
Beyond that, the market had a boost from Walmart's (NYSE:WMT) earnings after which the stock rallied 11% taking the entire retail sector up with it. Cramer was so impressed with Walmart's earnings that he coined the term 'WANG', where Walmart replaces Facebook with a bunch of high-growth tech stocks.
"The strength in Walmart impacted the whole psyche of the market," said Cramer. The same-store sales growth of 4.5% along with subsidiary Sam's Club's same-store sales growth of 6.5% showed the strength of the earnings. "I'll tell you what I liked best: when it comes to e-commerce, Walmart is finally catching up to and passing," added Cramer. "We continue to bring digital capabilities to our stores to deliver a seamless experience for customers however they choose to shop," said Walmart's CEO Doug McMillon on the conference call.
Apple (NASDAQ:AAPL) also hit a new all-time high after resumed trade talks. "We've also been fearful that Apple would get caught up in the trade war. You get a truce, it lowers the chance of a Chinese Apple boycott," added Cramer. He added that Walmart has become a must-own stock.
CEO interview - American Electric Power (NYSE:AEP)
Cramer interviewed his favorite utility player American Electric Power's CEO Nick Akins, as the company reported a good last quarter.
Akins said that business remains strong throughout their services areas and the growth target of 5-7% remains intact. The company cancelled the country's biggest Wind Catcher project that would generate electricity from wind energy after being disapproved by Texas regulators. That will be replaced by several small renewable energy projects.
The company also announced it will be building charging stations for electric vehicles around Ohio area, and this will bring the next leg of growth for them. "That's a major effort on our part to ensure that the infrastructure is there to support electric vehicles and certainly, we sell the electricity to electric vehicles. But also, it really is an avenue for transportation, to make sure that it is accessible to everyone without having to go to a gas station, for example," said Akins.
The stock of IAC is up 75% since Cramer recommended it last. The company reported great earnings and the stock still went up despite rallying going into the quarter. "If you feel like you've missed it after this staggering move, don't worry. In the words of Bachman Turner Overdrive, you ain't seen nothing yet," said Cramer.
IAC is known for spinning off digital brands that investors want to own. They spin off so that brands can get individual valuations. Their current portfolio includes Dictionary.com, Vimeo and the Daily Beast. They are also parent of ANGI Homeservices (NASDAQ:ANGI) and Match Group (NASDAQ:MTCH), the owner of Match.com and Tinder.
Match Group has been sued by Tinder executives claiming that the parent manufactured a lower valuation on purpose to deny them stock options. Cramer said the lawsuit makes IAC even more attractive. IAC's stake in ANGI and Match is worth $19B and yet their market cap is just $15.5B. The company is buying back their own stock and their other segments like app division are on fire.
The stock has more room to run.
More on Sen. Elizabeth Warren's interview
Cramer spoke more about the interview with Sen. Elizabeth Warren, who is proposing the Accountable Capitalism Act.
Cramer agrees with Warren that median incomes have been flat for decades but he is doubtful if the proposal would work. While it's no secret that the best companies create wealth for all and perform better than others, the federal regulations would not help.
The best in business - Costco (NASDAQ:COST) - pays their employees higher wages which reduces labor turnover, training costs and improves customer service. CEO Mark Benioff at Salesforce (NYSE:CRM) is an advocate of creating wealth for all stakeholders. Domino's (NYSE:DPZ) take pride on the strength of their franchisees that have generated wealth.
Cramer adds the all these companies did not need federal regulations take care of all stakeholders but he agrees that doing so goes hand-in-hand with performing well.
Viewer calls taken by Cramer
Sirius XM (NASDAQ:SIRI): The stock is down because of the competition. This is still a good subscription play.
Canada Goose (NYSE:GOOS): This is a decent level to buy as they were conservative in their forecast. It's a good long-term buy.
Alexion Pharmaceuticals (NASDAQ:ALXN): Baker Brothers have filed to sell a lot of Alexion stock. Cramer said he is less likely to buy till the selling is over.
eBay (NASDAQ:EBAY): It's tough as they don't have the momentum they once had.
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