Mad Money w/ Jim Cramer 2/19/25
44:24 Share

You worked hard to lay the foundation for your contracting business. And when you're with Amex Business Platinum, you can keep building it up with a flexible spending limit that adapts with your business. And since you earn five times membership rewards points on flights and prepaid hotels booked on amextravel.com, you get even more from on-site overseeing. That's the powerful backing of American Express. Not all purchases will be approved. Terms apply. Learn more at americanexpress.com slash amexbusiness.

What if your business could see beyond the what is and into what can be?

What if you could create more impact in every decision? What if you had a partner as visionary as you are? With Bank of America, you get access to our trusted experts, real-time insights, and digital tools. So whether you run a local shop or a global enterprise, you're backed by business solutions to make every move matter. What would you like the power to do? Visit bankofamerica.com slash banking for business to learn more. Bank of America is proud to be the official bank sponsor of FIFA World Cup 2026.

My mission is simple, to make you money. I'm here to level the playing field for all investors. There's always a bull market somewhere, and I promise to help you find it. Mad Money starts now. Hey, I'm Kramer. Welcome to Mad Money. Welcome to Kramerica. I'll be with my friends. I'm just trying to make you some money. My job is not just entertaining, educating, teach you, so call me 1-800-703-CBC. Tweet me at Jim Kramer.

When I first got in this industry as a kid, I knew that what mattered was the business cycle. If business was too strong, the Fed might raise rates, cool things off. If business was too weak, you might have some rate cuts. You always have to pay attention to these things, right? Because you don't want to fight the Fed. But today, with Dow gaining 71 points, S&P advancing 0.24% to a new all-time record.

NASDAQ edging up 0.07%. I'm starting to think, wait a second. I'm starting to really wonder if the business cycle is becoming outmoded term. Right now we have multiple business cycles and they aren't trading together in any sort of harmonious way. I wonder if they can't figure out what to do. Some businesses are going bonkers. Others are going foul. So this is going to be falling apart. And that's why it feels so weird that the NASDAQ and the S&P 500 keep bumping up the new highs and yet so much better.

bad is happening underneath. So many of the stocks in these indices are simply not that hot, including some of the MAG7, but that could change on a dime. Same with a bunch of others. And heaven forbid if the president takes action, and he loves taking action, for better or worse, whole cycles can be torn asunder. Let me give you the rundown of the biggest bullish ones and the biggest bearish ones so that you can figure out which ones are worth playing and which ones just may be too dangerous.

First, the most insanely positive cycle out there is travel leisure. This was mostly a holdout from the days of COVID when we discovered that we were long on money and short on time. I think the best of the bunch are all worth buying into weakness. The airlines are breathtaking. I've never seen anything like it. Old hands like me are used to seeing the airlines collapse once or twice a decade. Not anymore.

You don't need to think this one through. You just need to be obvious. You go by United. It's up 10% year-to-date. I think it can challenge this old high of 116. Given that people seem to want to travel no matter what, we're well past the initial post-COVID boom here. I think it can absolutely justify paying eight times earnings for United. When you travel, you need someplace to stay, don't you? There are two stocks that are roaring in this cycle, Marriott and Airbnb. They just reported excellent numbers. These were cyclical stocks before COVID. Now they're secular, meaning they seem to have growing growth no matter what.

You need some place to go, don't you? I keep hounding you to buy the stock of Disney. Buy, buy, buy, buy, buy, buy, buy! Because it's doing so well, yet all people seem to care about is that some weak link in the cable business that I think is going to pick up this quarter anyway. Theme parks, yes, they are expensive, but it doesn't seem to stop people from going to them. Go to a cruise, a Disney cruise, or buy the stock of Royal Caribbean. Keeps beating the numbers and beating numbers and beating numbers. Again, the cruise lines haven't been cyclical since COVID.

Need a way to pay? Need a way to book. Okay, that means buying Expedia, booking Holdings while using your American Express card. They have no quitting them. What's the opposite of the bullish travel leisure cycle? How about the bearish housing cycle? Last I told brother Sloan, one of my favorite home builders, reported a quarter that was mixed and the stock just got hammered.

The entire group took it down. Wow. Conference call was instructive because it showed there are cracks developing with lower average housing prices around the country, some very soft markets, something that's not supposed to happen when the Fed's cutting rates.

Mortgage rates are still way too high for this group. I want you to listen to what CEO Doug Yearley on the Compschool said. Quote, those areas where the buyers are a bit more hesitant, I think it's number one, those areas that have had more significant price appreciation through the COVID years than other areas. So instead of a 40 or 50 percent price increase, percentage price increase over the last five years, there are markets where they're at 60 percent, 70 percent, 80 percent, and 100 percent price increases. That includes Florida, primarily Austin, Texas.

Those prices have to come down. That's raw inflation. Those have to come down before we beat inflation in this country. Toll Brothers created the entire industry. Everything from Lennar, D.R. Horton, to Home Depot and Lowe's and everything they sell. And there's the banking cycle. Now that's in fuego. It's smoking. I mean, it's crazy.

The lack of a Democratic regulatory headwind and the slower rate cut cycle, good for them. Wells Fargo, Goldman Sachs, JP Morgan screaming higher. Doesn't hurt that the whole industry seems very confident that the Trump regulators will be more bank friendly than the Biden regulators. Well, no kidding. Who wouldn't be? On the other hand, you've got groups like the transports. They're just getting clocked.

At a conference call today, Norfolk saw one of the big East Coast railroads traced out a soft picture. New York Pacific didn't seem all that exciting either. Coal's weak. Chemical's horrible. Those are the ones that go into plastic. Plus, talk about being in the crosshairs of the tariffs. Do we want to own a rail that runs from Mexico to here or a trucking company like J.B. Hunt if we're getting into a tariff war in Mexico? To me, this group feels like it's practically in a recession cycle.

Today, the food and beverage and drug stocks all got some lift. But you want confusion? These are supposed to be anti-cycle companies. They don't have a cycle. But now that we have a human health and human service secretary who dislikes processed food and vaccinations. So you may be thinking it's not so much of a cycle as it is an entire blight on these industries. In this administration, nothing would shock you, would it? What if RFK Jr. wakes up tomorrow and says, I'm banning Froot Loops?

All right, stop and wait, lost shots. I mean, everyone in this administration seems to think that the federal government can do whatever it wants. That's not how our system works. Or at least it's not how the Constitution says it works. But the blight's very much with us, even with today's reprieve. Then there's the ag cycle. Deer stock can't stop. I think you just go buy the stock of Agco tomorrow. Farm equipment maker comes on the show all the time. Pretty good. How about another unstoppable cycle, the aerospace cycle? Right.

Love GE Aerospace. We bought some Honeywell for the Chapel Trust, as you can find out if you tune in to tomorrow's Club Call at noon. However, the aerospace cycle is so powerful. Get this. I'm going to say it. It's so powerful, you can maybe get close to it. I'm not going to say too loud. You can even buy Boeing.

All right, retail. Yeah, just the big three. Costco, TGX, Walmart, the airport tomorrow. You straighten those, look out. Mine failed. Use conflicting group of currents that make this economy almost impossible to understand. Sure, we know there are cycles in tech. Today, it's a bull market in the Internet of Things. Why? Because one of them, an analog device, has said good things. We have a strong semiconductor capital equipment company. That's why I brought on KLA last night and LAM tonight. At the same time, we have a PC cycle from hell.

We have a data center business that's been rocked by some outfit in China no one ever heard of. And we have a new product cycle from Apple itself that's both inexpensive and fabulous. I'm going to buy one tomorrow. But people are putting a real hate on enterprise software. Now think of Workday and Kramer Uber. Unbelievable. Amazing. Fave service now. It's a horrendous cohort.

Here's the bottom line. Can things stay this tenuous? Sadly, yes. I mean, today I shouted over to Jeff Marks, who runs the Shappell Trust with me. We'll be on tomorrow's noon CNBC Investing Club call. I said, hey, man, how does the market look to you? I heard him say toppy. And I agreed. I said, oh, yeah, toppy. He said, no, not toppy, choppy. I said, oh, yeah, that's right. I mean, yeah, sure, it's real choppy. It's not toppy. And doesn't that level of conviction or lack thereof say it all right now?

All right. I want to start with old friend David in New York. David. Good evening, Mr. Jim. How are you? I am good. How are you? Good, good. I have a question about C-E-L-H. It went up today. It went up today. This thing has been stuck. Remember, Philly, come on the show. This is that Celsius. Jeff loves Celsius. I looked at Celsius. It reminds me a lot of, I don't know, it's kind of like Selenese meets Dow and kind of like Eastern chemicals and, you know, Eastern...

But it's also drinkable. And it's going to report on Thursday, so let's see what happens. The shorts could be on the run in Celsius because everybody likes a good chemical in their drink. Let's go to Josh. Josh Brown, perhaps? Josh in Arizona. Josh. Hey, Jim. Thanks for taking my call. New to the club. Thank you in advance. Excellent.

Thank you. I took a note from Peter Lynch and I went to the mall. Okay. I'm fairly new to socks. And I came across ONON, OnCloud, Premium Shoe Apparel Company. I started doing research. I realized, A, my daughter wanted these for Christmas. I see all of her friends wearing them. I also noticed that...

A 65-year-old sports reporter was wearing them. I worked in professional baseball for almost 30 years. I walked in and saw my equipment manager with their website on his computer. I said, is it on cloud? He said, yeah, man, I was at Dick's. And I think you're right. Now, Peter Lynch, Peter Lynch, what what what what David is saying is basically the way you need to do. I'm sorry, it wasn't David, but it was David.

on one. It was Josh in Arizona that this is what he's doing is really important, which is what he's basically saying is he saw it on many, many people checked it out. And I think he's right. I think they're on a tear. I think they're still there. I see Nike maybe coming back. And I know that that new balance is back. But I've got to tell you, I definitely think that on on we've had them on many times. And I think that Josh has done very good work and he's right to pull the trigger. Tommy, New Jersey, Tommy.

Hey, Jimmy. Welcome back. Thank you, man. I need a couple days off. Thanks. You can see you're refreshed. I am. I really am. I have a two-part question. With Meta's latest sell-off, what's your thought on that? And as well,

What's your thought on Meta split at this point? Okay. Mark Zuckerberg likes his splits. I'll make you have a little sense on Meta. It went up so much that we actually did a little bit of trim for the trust because it got so huge for us. But not a lot because I'll tell you, it's still an expensive stock. And, you know, Mark, I know he, you know, Mark's, you know, Mark's, Mark's, Mark. But I really, I mean,

We own it. We have a lot of business cycles right now, and they're not trading together in any harmonious way. I think that that makes it so that it's a little more tenuous. But if you like what you own, just stick with it. Mad Money tonight. Fresh out of some Investor Day announcements from Lambert Search. What a stock.

Sitting down with the CEO to hear if the semi-stock can keep running. Then, how are higher egg prices affecting grocery companies like Spartan Nash with that 48% yield? Let's check them in the top list. And later, one of my absolute favorites, Arista Networks. It fell today despite what I thought was a really terrific quarter. Let's talk it over with the CEO and stay with Kramer.

Don't miss a second of Mad Money. Follow at Jim Kramer on X. Have a question? Tweet Kramer. Hashtag Mad Mentions. Send Jim an email to madmoneyatcnbc.com or give us a call at 1-800-743-CNBC. Miss something? Head to madmoney.cnbc.com.

The $150 billion pet industry is booming as people absolutely love their dogs. If you're looking for a solid investment, Dogtopia is the name to know. With 300 locations across North America, it's the largest, leading, and fastest-growing pet franchise offering a recurring revenue membership model. Dogtopia offers safe, open-play dog daycare, boarding, and spa services. Want a recession-resistant franchise? Check out Dogtopia because every dog and dog parent deserve it. Go to Dogtopia.com to learn more.

How will you shape the future of industrials with confidence? Whether you need to define your strategy, optimize your supply chain, or keep pace with data-driven manufacturing, EY professionals understand industrials and the sectors they supply, bringing the insights that deliver real outcomes. With a full spectrum of services, EY helps strengthen your business from factory floor to product development and beyond. So when the global market shifts, your business is agile enough to adapt. EY.

EY, shape the future with confidence.

Are the semiconductor capital equipment players finally ready to make their next major move? These stocks did get a clobber of the summer. They spent months trying to find their footing. But I'm starting to feel pretty sanguine about the industry. Thanks to what we've been hearing from Glamour Search.

Late last month, Lamb reported an excellent quarter with strong guidance, which sent the stock up more than 7% a single day. Then today, right here in New York, the company held an investor day. It rolled out some impressive long-term financial targets, made some major technology announcements. Thanks to these moves, the stock's now at more than 20% year-to-date, so you've got to ask, can it keep running? Let's dig deeper with someone who just really, really knows this industry better than maybe everyone. It's Tim Archer. He's the president of Lamb Research L'Amour. Mr. Archer, welcome back to Bit Money.

Great. Thanks, Jim. It's great to be here. I have to admit, Jim, I'm a big fan of the show. Thank you. And I have to say, I love it when people call in and ask about lamb research on the lightning round. Well, you know, I always say I love it. A lot of that's because I loved the bells before you, and you were.

there for what, 18 years at Novellus? A long time. 30 years between Novellus and Lamb. Well, thank you for those kind words. I was going to start by saying, look, we all didn't go to Caltech like you, so we do need to know what

it means to have an Atlas halo, which is atomic layer deposition harnesses the capabilities of metal, but metal molybdenum. But what I really want to go into is human ingenuity meets AI speed and robotic precision is one of the most important slides in your deck today. And what it says is if you want to know where the intellectual property of this world is located in this high tech business, it's right here. It's semiconductor capital equipment and it's you.

Well, thanks for saying that, Jim. I mean, let's start with that. Yes. Robotic precision, artificial intelligence and equipment. You know, we spend a lot of time developing these new materials like molybdenum and how to deposit those on the wafers. But ultimately, our customers have to put that into mass production. They have to make these chips and they have to make them at a cost and yield that works for the industry. And so we've really been spending a lot of time looking at how to engineer the fab and

About two months ago we introduced the use of collaborative robots, co-bots, as part of the maintenance for fabrication facilities. This was driven by a couple of ideas. One, it's about making these more productive and two,

The CHIPS Act programs that are happening all over the world are going to put fabs in places where we just don't have enough skilled workers. And so we see this as a potential solution to that problem as well. Now, Tim, most people think we can't make anything here. It's too expensive. Tell me how you could have so many great plants here if it's too hard to make things here.

- You know, Jim, I think that technology is usually the solution to any cost problem. So, you know, what we introduced today at our investor day was sort of the next level of technology to help our customers continue to scale. And we think that every region of the world can pick and be highly competitive in some aspect of the semiconductor market.

And at the leading edge, it's companies like Lam and others that are going to help enable our customers to be successful regardless of where they build those fabs. Now, are you building with the idea that five years, are you thinking right now about something that people may need five years from now? Or are you taking calls from people who are saying, please build this for us? You know, we talked about a number of different things today. But for instance, the Altus Halo system that we announced.

This tool is actually shipping to production customers today. But you're right, we actually started working on this tool six, seven, eight years ago. You know, big materials transitions, they don't come along very often. In fact, Jim, we talked about the fact that I've been at the company 30 years. The first tool I worked on was the Altus tungsten system.

Here we are 30 years later, and Mali is now replacing tungsten. So these are kind of once-in-a-generation type inflections, and Lamb prepared hard to be ready to meet this need. Now, I didn't go to – as I said, I didn't have a degree in Caltech. I do have a degree in the following, delivering compelling profitability for shareholders. Your record is extraordinary. I mean, we're talking about –

A 10-year, the kegger here is just, I don't know how you do it, but you have to talk about how earnings per share growth of 10x since calendar year 2013. I don't have a lot of companies that have done that.

Yeah, there aren't many companies that have done that. But, I mean, first of all, we focus on, again, our customer success and working with them to create the types of technologies they need. And we've also been very focused in our approach. We look at where the market is going to be expanding the fastest. And, frankly, about 10 years ago, the industry transitioned from 2D NAND to 3D NAND.

And we saw that in the coming inflections of semiconductor devices to the three-dimension scaling,

Etch and deposition would play an outsized role in that growth. And so we've stayed focused in that area. That's allowed us to be very efficient in our R&D of new systems and working with customers. And in the end, you know, we just have put that money back and our profitability back into making the company more efficient, driving future growth and really returning a lot of cash to our shareholders.

Now, I think people have to understand these numbers were done even though you took what it looks to be a $2 billion hit and not being able to sell China certain cutting edge products because of our government. I know you've complied fully, but that was kind of a big hole for your earnings. Yeah, Jim, as an American technology company, we, of course, have to comply with the rules in every jurisdiction we operate.

But when I step back and I think about those restrictions and kind of the broader sense of what's going on around the world, I think it's just further confirmation that semiconductors are absolutely critical to everything we do. I think what's little known about our company is that whether you're using a smartphone or using a PC or you're calling up AI,

The chips that are powering all of those technologies are made using equipment from lab research. And you are, at one point we would think about you as NAND and DRAM, and those are important technologies, but you have gotten higher and higher, high bandwidth memory. You've got a great slide about what you do with Micron. You have what you do with Taiwan Semi. You have taken it to another level. It's not just the build and then service. You're doing really cutting-edge stuff now that you didn't do, say, 10 years ago.

Yeah, as I said earlier, the scaling roadmaps of our customers are getting a lot more difficult. And what we've seen is in both DRAM and Foundry Logic,

The 2D shrink that's been the heart of our industry for so long has kind of run out of steam. And so customers are looking now to build DRAM in the third dimension, and that's by stacking chips on top of chips to create high bandwidth memory. And in Foundry Logic, they're going to vertical transistors, which also is driving tremendous opportunity for a deposition and edge company. When I talk to you and other people in this industry, I'm always proud that we still make the best and LAM is the best.

That's Tim Archer, president and CEO of Lambershurts LRCX. Probably from my first show, I thought that this was the company and the predecessor company that you should own if you want to own technology. Man, money's back at you, buddy. Coming up, is it time to fill up your grocery baskets? Kramer's getting a read on inflation and food prices with the CEO of Spartan Nash. Next. Flystone became an icon. A Hulu original from Questlove.

Sly and the Family Stone. It can't be overstated how popular they were. Variety calls Sly Lives the definitive funk-pop documentary. He opened the portal. I come this way. Generations have been influenced by Sly. RogerEbert.com raves. It's a sonic kick to the soul. If you've been on this high life and you stop, where's that energy go? Sly Lives, a.k.a. The Burden of Black Genius. Now streaming on Hulu.

At Capella University, learning the right skills could make a difference. That's why our business programs teach you relevant skills you can take from the course room to the workplace. A different future is closer than you think with Capella University. Learn more at capella.edu.

Last week, we got this incredible quarter for Spartan Nash. That's the food wholesaler, supplies grocers, running nearly 200 retail stores of their own across the Midwest. When these guys reported last week, they delivered a much better than expected quarter. Stock shot up more than 11% in response. That was correct. Since then, though, it's pulled back, giving back most of the gains.

I like this. Let's take a closer look with Tony Sarsom. He's the president and CEO of Spartan Nash. Find out what's happening in his company and in the broader industry. Mr. Sarsom, welcome back to Mad Money. It's great to be here, Jim. Thanks for having me. All right, Tony. We had a bunch of tech companies today, and they're hard to understand. Here's what I think that's easy to understand. You have a 4.5% yield, which is very safe. You've inflected since you were here last. The turnaround plan is in place. Tell us what it's going to do for shareholders. Great. Excited to do that.

Quick backdrop, though, just to remind you what we do. We are at the delightful intersection of wholesale and retail, as you mentioned. We are a food solutions company. We have a wholesale business that provides food solutions, groceries, and consulting services to over 2,300 independent grocers, including about 200 that we run ourselves at those stores. We're also very proud to serve the U.S. military system through the commissary system, giving our men and women in uniform a taste of home wherever they might be.

And so with that, we serve communities and we serve communities in a way that speaks to those shoppers and those specific communities. And it is part of what we call our people first culture, our people first in our organization. We think about our communities in that same way. Now, people first in this at this particular juncture is about fighting inflation. And I think of the companies that I've seen. Maybe you're the best fit.

in fight of inflation. Tell us how you've been keeping prices down for regular people in this country. Yeah, it's an important task for us. So as you think about even like the last time we talked, we were admitting that merchandising transformation. We talked about fighting for the absolute best prices and the best variety from our supplier community and looking for deals and things that speak to shoppers, the things that they want to save money on, things that excite them around the types of promotions that we can offer.

So we worked very hard on that. We spent a couple of years and we call that merchandising transformation. And we fight hard to keep our costs down, which allows us to not pass on any additional inflation. So we actually passed on less inflation than our supply to us was because we feel so strongly about that for our communities. Now, you did say in the conference call, and I was surprised about this, having been to the supermarket a couple of times in the last five days, inflation has largely returned to pre-pandemic conditions at around low single digits. I think a lot of people feel that's not true, right?

Yeah. Well, statistically, it's true. We had about 1.9% last year. And I should remind that this is growth in cost over a year. So last year was less than 2% inflation versus 2023. This year out of the gates, about the same. It's going to be a little lower. We're forecasting to be much lower, closer to even 1% than it is 2%. So food is stabilized.

in terms of what people are seeking, and those are really, really important fundamentals in their life, they will see that their groceries are not increasing as much anymore, back to those kind of pre-pandemic days of what the inflation might have been. - Okay, now I do want to talk about what you're doing in private label, because your private label is the lowest cost of the low, and yet high quality.

Family Fresh, Fresh and Finest Brands. Where will we find these? Well, you'll find them in our stores that we run ourselves in Michigan and much of the upper Midwest. For example, our Family Fairs, D&Ws, our Martin stores in Indiana, and a great many other banners.

They are also carried by all of the 2,100 other independent grocers in that same territory that we serve through our wholesale services. Now, what kind of work have you been doing with one of the great companies that we all know, Amazon? With Amazon. So Amazon has had a journey about trying to bring in more food into their Amazon stores, right?

They have been a great partner for us. They have massaged their model a little bit, so their growth is not as strong. Actually, they've pulled back quite a bit. And that's one of the reasons why when people look at the numbers, they may be confused. They don't see underlying, underneath what's really happening here. Yeah, so that has been one of the sources of our overall, you know, the overall story on our top line. But we still see them as an important partner for us. We're working with them through their piece. But if we can talk for a minute about growth broadly at XAmazon.

So we have we're going to invest in growth, both organic and inorganic. And you saw both expressions of those here recently. On the inorganic side, we made some acquisitions last year. Those acquisitions we made last year, grocery stores and some C stores, they outperformed versus our expectations. The fourth quarter, one of the reasons why we managed to have a third consecutive record EBITDA year was a strong performance of those acquisitions late in the year.

We also, I'll ask another point that gives us a lot of confidence. The investments made in our stores and what we are doing to actually invite shoppers into the excitement of our grocery offering paid off big time during the holidays. Both Thanksgiving and Christmas were over double digit performance for that season, which is part of the strength we've had coming into this year. So we're investing in making sure that we have a great offering in that neighborhood store that we run.

And we're doing it through what we call this customer value proposition. And the customer value proposition looks at what are the prices that make sense for our shoppers? What are the things they need to save on the most? We've been really aggressive on pricing those items.

And there's another macro trend that's really important to people right now. It's all around health and people interpreting health largely as fresh. So what kind of produce, meat, deli, bakery, those things are really important to people that are looking for that overall fresh experience. And we're going to invest in that to make sure we have a great offering there. And we can export that offering to our wholesale grocery customers as well. So we see that as a really important way for us to grow organically.

All right. Now, I looked at Price Check on you've got a great website. You've got Family Fair. It's buy one, get one week. Maximize your savings for some really great brands that we all know. A lot of fresh stuff, too. So it's not all just can't process. You're so off the mark to be lower than everybody else. So I think people out here have to recognize how did it happen?

Because maybe the prices we're seeing are too high at other places, given the fact that you still make pretty darn good money with the prices I'm seeing here. Yeah, and I think it is a, you know, this is a very competitive industry, as you know. And so we have, and I wouldn't say we have the absolute lowest in the marketplace, but we are fighting that fight. And we are trying to establish the, what does that neighborhood grocery store mean? There's something that's important about some of our competitors who may be very deep discounters. They offer something.

And there's folks who offer a variety of different types of things and service to their shoppers. Our shopper wants, kind of wants the whole piece. They want to have great prices. They want to be able to get the birthday cake for their kids. They want that service. They want to talk to the butcher about what's the best bratwurst we have that we're serving up that day. Those things really matter to them. So that personal touch and the service they get and the service

the whole store with good pricing, it's a little bit of a balancing act. That's what we're doing. That's why we're fighting for the community. But there's some cases where you can't control the price of eggs, sir. We cannot. Yeah. So eggs have been a little bit of a challenge the last two years. What do you do? Well, it is a constant effort to kind of get the right pricing. So as you think about it, it's a complicated story with eggs, right? So I'll take a crack and try to open it up a little bit.

So we had two years in a row of avian flu, which that kind of really priced up. Those are temporary events, right? But we're in the middle one right now. So it's tougher for customers. So we work to make sure that we have longer-term supply agreements with a lot of the farmers so we can actually get lock-in on a great price. And we are right now, we have a price that is lower than the market overall. And we're passing that all on to our customers and to our shoppers. So we think that eggs are such an important way for people to get protein and nutrients back.

So I want to make sure we're very, very competitive on that. And we look at prices on eggs all the time. We actually have a very competitive offering on our eggs. Well, you sure do. You're a competitive offering. Anyone can see the offerings. They're all there. I looked at all of them, and I can tell you that if you want value at a price with a dividend and growth, it's this quarter was the real quarter that I've been waiting for, which is why I was so happy to have you on. Tony Sarsaparilla is the president and CEO of Spartan Nash. Take a look at this. Not everything has to be semiconductors. We'll be right back.

Coming up, what's the read on AI? Kramer's got a one-on-one with cloud networking giant Arista. Fresh off the company's latest earnings report. Next. For years now, Arista Networks has been one of the biggest winners out there and one of my favorites. This maker of cutting-edge networking equipment has become a major part of the AI infrastructure story, too, which is why its stock has rallied from the mid-30s to the triple digits in just two years.

But is this all kind of a one of you dunkery lately market? And lately, Wall Street's gotten skittish on Arista. After hitting a new all-time high of just under 130 last month, it's pulled back now just under 104 as of today. Now, some of that's from this deep seek news. We're going to get to that. Stock fell 22% on the day that story came out. Crazy. But Arista's been making its way back from the event. Ford fell over 6% today in response to last night's quarterly report. Look, the headline numbers are strong. Some investors looking for some different kind of things. We're going to get into that, too. Look,

Look, there was also some concerns about competitive pressures with certain large customers. So what comes next? Let's check in with the one and only Jay Shree Yolanda. Jay Shree, old friend of the show, is the chair and CEO of Arista Networks. Ms. Yolanda, welcome back to Mad Money. Thank you, Jim. The one and only Jim Cramer, I would add. Oh, I just think, oh, look at what you've done, what you've accomplished. It's just awesome. People should read the deck because it's all very clear. Now, before we get to why the stock went lower,

I don't want to forget the fact that you, first of all, revenue up 25% year over year and acceleration for the previous quarter. Better than Wall Street was expecting. Better than expected gross margins and operating margins. Eight cent bottom line beat. So before we start talking about what people didn't like about the quarter, why don't you give us some of the highlights of what really happened during the quarter?

Well, I think I want to step back and tell you what really happened over the entire year. We had first guided from 10% to 12% and were targeting $6.5 billion. And we kind of skipped the six-digit entirely and went to $7 billion. Chantel, my new CFO, and I are very proud because we navigated

you know, very high expectations, as you say. Also a pivot from our customers from the cloud to AI, as well as growing the enterprise. And I always like to say, you know, when the tough get going, when the tough have to get going. And we are now fulfilling both

networking for AI and AI for networking. So it's a very exciting year. And of course, the quarter contributed to that as well. And we beat all expectations. Well, you've changed the lexicon of the industry. We think about the tech titans and out of nowhere, suddenly Oracle has become a huge tech titan. And I'd like to know how important is Oracle to the mosaic of your business?

If you step back and look at our Cloud Titans, we now call these tech titans as you say, Cloud and AI titans. It's a class of customers who historically helped build the Cloud and now deploy hundreds of thousands of servers, megawatts of capacity in their data centers,

What happened in the last couple of years is not only did they build the cloud up, but they also built this AI cloud. And so they're building some of the world's largest, not just data centers, but what I call AI centers, weaving in the back end of the AI infrastructure with the front end of the AI and cloud infrastructure. And to your point, we have some pretty major customers there, including Microsoft Meta, and newcomers into that are Oracle and Google. So these titans are indeed growing.

huge and the capex is indeed very large. We're a wee small piece of that in terms of networking. I know you can take a lot more share. I did want to ask you, were you shocked about how shocked the market was about DeepSeek? Even as one after another of your tech cloud titans was placing huge orders as if they didn't know about DeepSeek. Everyone in your business must have known about DeepSeek. So you probably were dismayed that the stock took such a hit.

Well, you know, over time, like you, we get used to the volatility of our stock and we try to do the right thing. And then eventually the stock also does the right thing. And you pointed out over the last decade, since you've been observing us after, you know, it's been over 10 years since we went public. So not disturbed, but surprised for sure. And the reason I'm surprised is I think all

all of these AI models for large language training, whether it's OpenAI or Grok or all the different ones, are contributing to massive bandwidth pressure. And AI workloads are very different from cloud workloads in terms of diversity, type of flow, and they're very intensive. So you have to handle them a special way.

Now, while deep six to number of stocks including us, I think the realization now for everybody is it's yet another model. It's a model based on reasoning, mixture of experts, more inference, and isn't the intense training model that OpenAI and others are doing. It's different strokes for different folks,

And I think a mixture of these models only puts more pressure on the network and requires us to build more robust, scale-out AI networking. I wish I had been speaking to you that day. I wish I had spoken to you that day. That is the crucial part. You maybe need more equipment. Now, there are people who are concerned, Jayshree, that meta went from 21% of your sales in 2023 to 15% in 2024.

I thought you explained it perfectly. You talked about the year of efficiency and then how it was very hard to be able to equal the bump that you got. But I just want people to know from you, meta is not a problem, right? Meta is more of a key component and supplier. You're a key supplier.

Yeah, I would hardly call Meta a problem. M&M, I like candy, and they are my favorite customers among many others. And what I'll say is rather than a problem, we actually look to solve problems and jointly innovate. Just a few months ago, we introduced the distributed Etherlink switch.

which is yet another form and a new form of AI networking, bringing a distributed leaf and spine together. This is our third product that we're jointly engineering with Meta. So yeah, we'll deal with the ebbs and flows and the years of efficiency. And it's not ever right to look at just four quarters.

But I believe Meta and Microsoft will continue to be important, greater than 10% customers. And increasingly, we'll have other strategic customers as well, which is the way it should be. We should have a diversified suite of customers. Okay. The only line in the whole call that did concern me

was when you said, well, I do appreciate the exuberant support from our analyst community on our momentum. I would encourage you to pay attention to our stated guidance. To me, that was somewhat like my friend Frank Slootman said on the show once. I said, you got to be you can't you must be being too negative. He said the guidance is the guidance is the guidance, the guidance, meaning don't go beyond that. And then you'll otherwise you'll be led astray.

Well, first of all, I want to go on record saying, you know, Frank Sluthman is one of my favorite CEOs. I'm on the board of Snowflake. I know. And so if he said it, if he said it, it must be right. And if I said it, he must be right. And all I'll say is, you know, why ask a company for guidance if you're not going to take it seriously? Obviously, as the year progresses, if we find things are more positive, we'll let you know. But things can change.

in a very volatile fashion very quickly. And while I really appreciate the support and momentum, I wanted to add a dose of reality that growing 17% year over year on large numbers is a pretty damn good thing. Well, look, I...

I want people to know that because the reality is, is that every single time I was telling my staff, every single time you've had one of these declines, because there is a road to 70 billion total addressable market, you must buy. And I don't think this is any time different. But I did want you to just talk about how huge this market really is. So people don't think that we're anywhere near being tapped out.

Now, this is a really good point. You may have seen some of the tech titans, CapEx, they add up to a lot of money. They're 250 billion or whatever. Obviously, we're not going to get all of it, but our own TAM, our total available market in 2028, is north of 70 billion. And here we are excited about reporting a year that 7 billion last year, going to 8.2 or heading to, I would say, 10 billion and many, many more in the future. But we've got a lot of headroom here.

and a lot of opportunity in three areas, the enterprise and campus, the data center, both cloud and enterprise, as well as the cloud and AI titans and their infrastructure. Three huge markets for us to execute and navigate and do much better than we've even done so far. Well, I will say what I would have said if I were in the queue of the conference call. Congratulations on a great quarter, Jayshree Yalal. And it's always good to see you. Great to see you, Jim. Thank you for having me.

People, this stock never comes down. And when it does, it's your chance. Am I back in the break? Coming up, Kramer takes your calls. And the sky's the limit. It's a fast-fire lightning round. Next. It is time. It's time for the lightning round. It's time for the lightning round.

And then the lightning round is over. Are you ready, Ski? Guys, I'm the lightning round charisma. I'm going to start with Richard in California. Richard! Jimmy Chill. Yo, yo. It's really you. Yeah, most definitely. You bet it is. What's going on? What's going on? Calling on, I'm calling today about a stock that had a couple of good pops recently, last seven days, and wanting to know if I should hang in there as part of my...

Stocks, one of my big stocks, one of my five featured stocks. And I want to know if I should continue gone or share a little. The stock is Deere. The ag cycle has switched. It's now bullish. I've got to tell you, that's when you buy Deere. I'm going to throw an ag call. I'm giving him a twofer, giving him a twofer. Let's go to Shelly in West Virginia. Shelly. Hey.

Hey, Jim. How are you? I am good, Shelly. How are you? I'm good. I love your show, and congratulations on the Eagles win. Oh, thanks a lot. That was a big deal for me. Thank you very much. I really appreciate you mentioning it. How do we help? My...

My question is about Arm Holding. I bought it around $160 a while ago, and then it went to $182 and changed. And I was making a decent bit of money, but I didn't get out. Don't worry about it, Shelley. I've got to tell you, Arm is just a very good company. And it's Rene Haas, and we can own it for the long term. That's what I encourage you to do. If it got down to $120, I would buy more. I'd put a double down on position. Let's go to Brett in California. Brett.

Jim, thank you so much for getting the lightning round. I really appreciate it. Thank you. It's fun to have you on. Thank you. Glad you're with us. Jim, so I've been doing a lot of research on this company. I mean, I have a really good network of farms. I'm just trying to find a good egg company, a premium egg company. I use them, and I just feel like they have a great balance sheet. It's called Vital Farms. Do you recommend that, or do you have something better than that? I don't know Vital Farms.

I'm going to have to come back on Vital Farms. Sounds like a really good company. I was thinking maybe you were talking about Sprouts, which is a real good company. But we're going to do work on Vital Farms and we're going to come back. And I really appreciate you stopping me. I don't mind that. It sounds like a new one. Let's go to Dean in Ohio. Dean!

Booyah, Jim. Booyah. Charter Club member, third-time caller. Fantastic. Thank you. I am looking at a stock I'm very interested in. On February the 10th, it was added to the investing club. Prior to that, on the 6th, the client commented that it's a gift to investors. Is the new product line for this?

company. Going to make it a strong buy. Worth the waiting. The stock is Bristol Myers. I think Bristol Myers is the most attractive drug stock other than Lilly. I think Cabenpi is going to be one of the largest drugs of all time because it's going into schizophrenia. It's a great drug for the brain. Really incredibly hard. I do a lot of stuff. I used to be the chief spokesman of the American Brain Foundation.

I still work for the American Migraine Foundation. I can tell you that this company really has the silver bullet for schizophrenia, which is one of the worst diseases in the world, and it can be expanded beyond that. It's a multi, multi-billion dollar drug, and it is going to be great while you wait. 4.5% yield. Own Bristol Mars. And that, ladies and gentlemen, is the conclusion of the Lightning Round. The Lightning Round is sponsored by Charles Schwab.

Coming up, time to put away the wings. Kramer is giving you his take on why Wingstop shares are down after earnings and how the company's guidance may be a warning sign for investors. Next. I always tell you to wait until you hear the guidance before you buy or sell anything in response to an earnings report. What I don't say often enough, though, is that it's just as important to find out how the guidance is given. That's right. The actual warning, the context, right?

Frank Sloeman, former CEO of Snowflake, famously told us that the guidance is the guidance when he gave us a downbeat forecast. I was asking if he was maybe being an extra conservative, which is what he lashed me. He lashed me out with that guidance is the guidance line. I never forgot it. The numbers were real, though. Sloeman was right. Next quarter, not the right home about. It would have been irresponsible, damning, frankly, if he tried to downplay it. But he's a straight shooter who didn't want to sugarcoat the future of Snowflake, which, by the way, is moving back up.

Jay Shreyalal from Arista Networks, whom you just heard from, did a version of this on her conference call last night that I mentioned. She said, while I do appreciate the exuberant support from our analyst community on our momentum, I would encourage you to pay attention to our stated guidance. See, that's a gauntlet that says keep your numbers reasonable, analysts. We are trying to do our best, and this is the most accurate guidance we can give, given the circumstances. Makes sense to me. I can't stress how important the wording of the guidance is, which brings me to Wingstop.

a one-time favorite, which has seen a rather dramatic and unexpected slowdown in same-store sales. When he stops doing so many things right, the average unit volumes per square are spectacular. The unit growth is amazing. The profit margins are extraordinary. Well, the wings taste great. But what matters in retail is, frankly, the same-store sales. That's the key metric. And the fourth quarter same-store sales results today,

Well, they were 10.1%, which is pretty disappointing compared to the growth that they put up in the preceding quarters, 22%, 29%, and 21% respectively. Now, understand, when Wingstop had last reported in November, the company guided for a full year 2024 same-source sales growth of 20%, which implied that the fourth quarter would certainly be weaker. That guidance back then caused the stock to fall from $369 to $290. So it shouldn't have been shocking when Wingstop did a little better than 10%, even though we were used to getting some terrific upside...

Surprises from these guys. They told you implicitly that this was coming.

But they didn't make it crystal clear. Wingstop also doesn't seem to understand that Wall Street wants to know, why is this happening? Why don't we get anything, any color about what's going on? So why did the stock drop so much today? Again, it was the guidance. This time they told you that business would put up low to mid single digit domestic same store sales growth this year. Look, that's perfect for McDonald's. It's extremely disappointing if you're a Wingstop shareholder. People who've gotten used to at least 20% growth and the pain wasn't emirated by positive talk about Alibaba.

average unit volumes or more new stores. In fact, it made management seem oblivious because they didn't tell you why these all-important numbers were slowing. And the guidance drove the stock from $306 to $265 today, one day.

None of this would happen if Wingstop had a lower price earnings multiple, but it doesn't. Even after falling close to 40% from its highest last fall, it still sells for 60 times earnings. I can get the same store sales growth of 27% from Brinker, parent of Chili's, and that stock only sells at 22 times earnings. Who the heck would pay 60 times earnings for a stock like Wingstop now that it has low to mid-single digit same store sales growth? Nobody.

Hence the vicious decline. Look, I'm not being belligerent here. Don't mean to be. If Wingstop can beat that guidance, this will turn out to be a fabulous buying opportunity. However, again, with this company, the guidance is, well, the guidance. And this dip can't be bought. Not without an explanation for the same-store sales slowdown. They haven't given us one. They just want to tell you how great they are doing, and that is not enough for me.

I'm a stickler for key metrics that measure growth. And no matter what, same-store sales growth is the most important metric when you're dealing with a restaurant stock or a retailer of any sorts. Nothing against Wingstop. Love the wings more than ever. But in the old days, I wanted to buy a franchise. Now, with this kind of slowing, again, without any explanation, I just want to buy the wings. I like to say there's always a bull market somewhere. I promise I'll find it just for you right here on MadMoney. I'm Jim Craver, and I'll see you tomorrow.

All opinions expressed by Jim Cramer on this podcast are solely Cramer's opinions and do not reflect the opinions of CNBC, NBCUniversal, or their parent company or affiliates, and may have been previously disseminated by Cramer on television, radio, internet, or another medium.

You should not treat any opinion expressed by Jim Cramer as a specific inducement to make a particular investment or follow a particular strategy, but only as an expression of his opinion. Cramer'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 forward slash madmoneydisclaimer.

At Capella University, learning the right skills could make a difference. That's why our business programs teach you relevant skills you can take from the course room to the workplace. A different future is closer than you think with Capella University. Learn more at capella.edu.