'Mad Money w/ Jim Cramer 6/5/25
43:45 Share

Your best restaurant location gets five-star reviews. How do you make every location like your best location? Your best paper mill has been operating at peak productivity. How do you make every mill like your best mill? Your best data center has optimized every drop of water. How do you make every data center like your best data center? The answer is Ecolab. Better performance, better outcomes, better impact. Ecolab. Now every location is your best location.

♪♪♪

Hey, I'm Kramer. Welcome to Mad Money. Welcome to Kramerica. Other people want to make friends? I'm just trying to save a little money. My job is not just to entertain, but to try to explain what happened on a day like today. So call me, 1-800-743-CBC. Tweet me, Jim Kramer.

You can learn a lot about a market from looking at the stocks that make it to the 52-week high list. It's a rarefied group by nature, and it speaks loudly about what works and, of course, what doesn't. So on a day when the Dow slipped 108 points, S&P declined 0.53%, and the Nasdaq lost 0.83%, most of that decline occurring in the second half of a tumultuous recession, I want to interpret what the market is saying for you. That way you can make your own judgments.

Let's use yesterday's list. It's more informative and shows you some real themes that I think have staying power despite today's ugly action. First, it's probably not that surprising, but there's no real tech on the 52-week high list these days. President Trump had what he called a successful call with President Xi, and they talked about getting together. We heard that rare earth minerals were discussed, something China has a near monopoly on. I understand that we're now facing some auto factory closures because we don't have enough rare earth magnets here. They're made in China.

We didn't build cars? We got a momentary bump up for tech, but it was ephemeral. Tech came apart as quickly as it came together because without a deal with China, the group could remain under pressure for some time, even as there are tons of individual stocks in the tech group that have nothing to do with China. It's important to realize, though,

The tech's not well represented in the 52-week high list. In fact, there was only one big one, and that's Brocom, which reported a small top and bottom line beat after the close with solid guidance for the current quarter. But the stock is just getting hammered in the after-hours trading. Now, I think the stock simply came in too high given how much it's run for the April lows. I'm not buying the bear case.

which is based on some narrower margins on custom-made chips than it does. It's just that tech stocks are under pressure, and Brocon wouldn't be spared today, whether it reported or not. And people should recognize that instead of freaking out. It's up 12% for the year. We've also got a couple of smaller techs acting superbly, incredibly. Seagate is on the list. For a long time, this was just another commodity tech play.

But now it's an AI trade because data centers need lots of hard drives. What a comeback. Hey, glad they could hold on for all these years. Last week, we had Zscale on the show. Now, this is a cybersecurity identity play. It just blew away the estimates.

Now, look, I've gotten spoiled just owning Palo Alto Networks and CrowdStrike for the Travel Trust. But verifying a person's identity in order to stop imposters, that's a very good business. I wish I could own three of these for the trust, but owning two has already violated my rules for diversification. I'd have to apologize to club members. I'm not going.

there. Then if you want to stretch things, let's roll in Johnson Controls. Yeah, HVAC, all right? It creates big cooling systems, very much needed to keep data centers from overheating. Sometimes I think that they just got really lucky to have this business. Stock's been strong now for ages. It might be a collateral player, might have been the most potent stock in the market. Coreweave, which closed yesterday as a four-bagger from its recent IPO before pulling back hard today. It's kind of a bit of a meme stock.

Yeah, you know what that is. Now, there was a time when these tech stocks couldn't be on the 52-week high list unless they were led by an Alphabet or an Apple or an Amazon. Instead, we'll have to settle for Microsoft, which hit the high list today and has been flying ever since that last quarter, which indeed was a great one.

The dominant winner in this new high list examination, well, it's so easy. You probably even know. I've just watched a couple hours of our shows, and that's Netflix. Now, here's a stock that seems to permanently reside on the new high list. It's one of those positions that every time it moves up, some analyst raises numbers and raises price targets. Truly virtuous circle. Right now, Netflix is going up on its content slate, including the upcoming season of Stranger Things and Squid Game.

It's also been going up because its ad tier is working well, and it should only get better as they develop more ways to help advertisers target the right viewers. At the end of the day, Wall Street loves the subscription business, and Netflix, it's the king of subscriptions. My confidence in the subscription model extends to Spotify. This incredible company dominates the podcast business and the music business, and, of course, the new high list. It's roaring right now, but it does have periodic moments of underperformance, and that's when you've got to snap it up.

What else made the list yesterday? Cintas is not necessarily considered a subscription business. Hey, but their standard contract is five years for it to bring your company uniforms, first aid products, fire protection and safety gear. Sure, the stock typically goes down if you think we're headed for a slowdown. But Cintas can't join the new high list without robust blue collar hiring.

The fact that it's up here is a terrific sign, actually, for the broader economy. Now, there are plenty of fintechs that have come public in the last 10 years. They always have their adherents who believe the whole group should be on the 52-week high list. It is so overloved that it makes me sick. I find these now repulsive.

If you want to know what a reliable fintech looks like, look no further than Visa, which I can't believe is on the high list, even though it had a terrific quarter, of course. You know what? I'm hoping that COF Capital One, which just bought Discover Financial, that it could enter the 52-week hollow ground. It's cheap. It'll have a gigantic buyback.

Come July, Visa's the one that's made it. Right now, COF, I feel very lonely, but I won't come July. There's no real theme to the other stocks on the list. DoorDash, that's been a winner from the get-go, and we know from Campbell's Soup Conference call, and by Dollar General, too, that people like to eat at home these days. That could mean DoorDash, which is remarkably well-run and has a deservedly strong reputation, if, indeed, you don't want to cook at home.

eBay is a real shocker. It's come a long way to get back on this list. Now, I've watched this stock get carved up for ages, but now it looks like eBay has stopped being a whipping boy and people are feeling comfortable buying merchandise secondhand as a partnership with Facebook's Marketplace, which has spurred real growth for the company. I like that, by the way, that Marketplace section.

Then there are two one-offs, Roblox and Mosaic. The game of Roblox is something that fascinates kids. It may be too much for all I know, but the point is it's insanely popular. It's a nothing but go up ever since it was attacked by Short Cellar. I got to tell you, I think that it's cleaned up its act. I think it's terrific. Here's a real tough one to understand, Mosaic.

fertilizer company now this one's an oddity it's entirely possible that people are playing a theme of china food shortages and that's one by the way that i'm not seeing i think what it really is is farmers are flush and that means they're capable of buying tons of fertilizer which doesn't cost that much anyway finally there's ge aerospace now this company has some of the greatest cash flow

I've ever seen. It makes aircraft engines and maintenance businesses fantastic. That may be the single best annuity stream I have ever seen. It's one of my faves, but after this run, you can only buy it at a discount. Now, each day has its own mosaic. We have Axon tonight, the law enforcement technology company that has so much business. They can barely handle it. It's

New high natural. By the way, they have great software business growing at more than 30%. There's booking holdings, the old price line, which might make you think twice before you run off the travel bull market. And why don't we just throw in another one that I really like into it? The small business person's digital accountant, or so I like to think about the turbo tax division. Three aces there. By the way, you can also learn a lot from the worst performers.

Today it was Brown Foreman, the parent of Jack Daniels, on a terrible quarter. More on that later. But the second worst, it's Tesla. You know, I don't even know what to say here. You get a stock down this much, not only do you have to have terrible numbers, which Tesla certainly does, you have to effectively go to war with the President of the United States!

So many people own Tesla because Elon Musk was tight with Trump. Now that they're on bad terms, not such a good reason. Here's the bottom line. At the end of the day, this new high list is an eclectic group of stocks, mostly geared to U.S. venues. That makes sense given the trade war. I'd be a buyer of any of these names down 5% to 8% from these levels. That is my favorite percentage to start a position on a red-hot stock and not buy.

before then. Like I said, the market's a terrific teacher, and it's teaching you that these stocks are great for the current environment. House of pleasure. Let's go to Richard in Florida. Richard! Hey, Jim. How are you? I am doing well. How about you, partner?

I am doing well here in sunny South Florida. Hey, listen, you recommended Dutch Brothers a few months back, and I made a lot of money from it. I doubled my investment, and I exited the position. I'm just calling to see if now is a good time to get back in.

Okay, Christine Barone was in town the other day. I said hello to her. The stock's up on a real spike. It was up really big yesterday. It's a very hot stock. I would suggest buying it down 5%, but boy, do I like it. How about we go to Anne in Indiana. Anne. Jim, thanks. I'm a club member. Thank you. Thank you. Calling about service now. Oh, yeah. Should I have bought it for the club? I got to tell you, Anne, I...

Over and over again, I thought about it because it's such a good company. I know its earnings are, it looks like it's expensive stock, but in the rule of 40, it's terrific. I got a hand to Bill McDermott. I'm never going to say a bad word about ServiceNow. If you want to buy some, I am certainly going to green light that.

By the way, can I just tell you, I look at what they're doing and I say to myself, wow, they've really figured out AI. Where did I get that from? Jensen Wong. All right. It's an eclectic list of stocks near 52-week highs, but I wouldn't go against any of them given all the buyers out there. We'll make money tonight. Axon.

which I just mentioned, was on that 52-week high list. So what's driving the strength? I'm checking in with the company's top brass. And Boeing stock has taken flight over the last two months. So a clear sky's the head for the ones ailing aerospace company. I'm going to give you my take. And what the heck did just happen with Cracker Barrel? I'm seeing if the decline is worth nibbling at, if not just taking the whole darn thing. Stay with Crack.

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 consumer products in retail with confidence? Behind every favorite product or seamless checkout, there's a series of strategic decisions to make.

EY brings real-time insights and deep sector expertise to create value in the moments that matter. Whether it's untangling global supply chains, managing cost pressures, or leveraging emerging tech, EY's full spectrum of services help CPG and retail companies deliver profitable growth. EY. Shape the future with confidence.

You just realized your business needed to hire someone yesterday. How can you find amazing candidates fast? Easy. Just use Indeed. When it comes to hiring, Indeed is all you need. Stop struggling to get your job posts seen on other job sites. Indeed's sponsored jobs help you stand out and hire fast. With sponsored jobs, your post jumps to the top of the page for your relevant candidates, so you can reach the people you want faster.

According to Indeed data, sponsored jobs posted directly on Indeed have 45% more applications than non-sponsored jobs. There's no need to wait any longer. Speed up your hiring right now with Indeed. And listeners of this show will get a $75 sponsored job credit to get your jobs more visibility at Indeed.com slash madmoney. Just go to Indeed.com slash madmoney right now and support our show by saying you heard about Indeed on this podcast.

Indeed.com slash madmoney. Terms and conditions apply. Hiring? Indeed is all you need.

What a run we've seen in Axon Enterprise, a company formerly known as Taser International, that now is a big police body cam business, along with all sorts of software for law enforcement. And this company is going big international. The company's stately been a great creator of value, with the stock up almost 180 percent over the past, just the last 12 months alone. Axon's products are in high demand because they help solve major problems for law enforcement.

In fact, last month, the company reported tremendous top and bottom on my beat. Sent this stock up more than 14% in a single day. Deserve it. It's now up over 32% for the year, and it just keeps climbing. So is there anything to derail this move, or will the stock continue chugging its way higher? As you know, I have thought for a long time. Let's check in with Rick Smith, the founder and CEO of Axon Enterprise. Welcome back to Mad Money. Hey, Jim. It's great to be back. Rick, before I get started with the questions, could you tell me where you are?

I am in my volcano lair. You may remember when we first met in the early 2000s, all the critics were saying that I was running some sort of evil empire and that tasers were hurting people. And in a sort of self-deprecating move, I said, well, if I'm a villain, I need a volcano lair. And I've now turned it into my podcasting studio where I do a weekly podcast. You weren't too much. Remember when I asked you to taser me and you said in Jersey they wouldn't let you?

Yes. Yeah. Well, you know, I can always bring one back if you still if you're down for it. I've been a believer for 25 years of you. I'm not changing. You start your conference call with something and it's almost like too good to be true. But I'm going to read it so people know we envision a society where violence and crime rarely occur because it's simply so unappealing and so well deterred. You envision it. Can it happen?

Oh, absolutely. Like, uh, I believe right now, America, we have, frankly, I think we've achieved the worst of both worlds. And that is we incarcerate a huge part of our population, but people don't believe they're going to get caught. And so we sort of, I think we're probably the worst point possible where we're incarcerating a bunch of people, but it's not really deterrent. And so I think if we really focus less on, uh,

lifestyle choices and those sorts of things and more like, look, let's go after violent criminals. And if you are involved in any sort of violent crime, you should get put away with such high probability that people will look at it and say, you know what? I'm just not even going to try. That is something. And you know what? It's kind of how I feel about what Wall Street thinks of you. I'm looking at you.

I'm looking at your numbers and I'm thinking, when are people going to realize there are very few 30 percent growers in the entire world that may just be getting started because you're just going overseas and have a vision like you just traced out? I mean, isn't it odd that you and I both know this is a 30 percent grower? People keep thinking it's the last good quarter.

You know, I, too, actually get surprised every quarter. We end up doing better than we expect. You know, I've learned you got to be a bit conservative and not get too far out of your skis. But we just I am blessed to work with this amazing team on like problems that just matter. Right. The world is a violent, scary, dangerous place. And we see lots of ways we can make it less violent, less scary. And we would see less people getting shot and killed.

Well, look, I think that one of the things that people have to realize, he just said, I want people at home to know, you said team. You were probably the person who flags the most names of anyone. I read yours and I think about there's 10 people, no 12 people, no 15 people that Rick relies on. You don't just talk about team, you tell team. Now, one of the people that is talked about that's so great, you've got Brittany Baggett.

your CFO, who seemed to know what could happen with tariffs years ago. Yeah, she is. Britney is phenomenal. She joined us just a few years ago and is really just taking our financial game to the next level. And she's a great counterbalance to me. Right. My my job is to focus on what are the big problems we're going to go solve. And then Britney has to make sure, OK, Rick, like

We got to make sure this makes financial sense. And when we get those two things right, when we solve big problems, whether it's with body cameras or virtual reality training or our new vehicle intelligence AI, we also have to make sure that, OK, what's the business model that makes sense so it can continue to drive the financial machinery that funds all the things we want to go develop? And people should know that Xi saw problems in the South China Sea and how you had to avoid them a very long time ago.

Yeah, she did. Yeah, she does a great job leading not only finance, but operations and also really looking around the corner at risk.

Like, OK, where could we get bit next? We should actually shoot together. Josh Isner brought in Condoleezza Rice, has spoken to our board a couple of times on the geopolitics of the South China Sea so we could keep an eye on it. Now, last time I didn't get to talk to you about drones. You seem to understand the role that drones could play to the point you made an acquisition. Can you tell me what your drones do and whether we could use them in all sorts of war areas?

Yeah. So we acquired a company called Sky Hero, and these are tactical drones. They're used by special forces operators and SWAT teams. We also acquired a company called D-Drone that is the world leader in counter drone detection. So we both make drones and the way to detect drones. We protect all the NFL stadiums and the World Cup. And we have hundreds of sensors spread across Ukraine. And I absolutely think we as a company are

do not want to get in the business of killing people, but we will absolutely get in the business of destroying dangerous drones and equipment that are coming to kill people. And so we think our acquisitions in this space have set us up, again, to solve problems we care about. If you saw what Ukraine just did, I mean, we all did, right? They took out a third of Russia's nuclear bomber fleet with $500 FPV drones. Every military on earth, in addition to every

public venue or police force has to now think, how do we defend against $500 drones with grenades on them? Now, I also imagine that you would have to do that using AI. I don't think you just do it with humans. Oh, 100%. Yeah, we...

So our D-drone unit takes AI sensors, radar, RF detection, cameras, and we integrate all those feeds to help tell you where the drones are, which ones are known drones that are good drones versus potentially unknown or malicious drones. You've got to process all that data very quickly and get it to a human being. Now, in the future, we'll be feeding that into our drones.

drones will be going out on counter drone missions. So we'll have our drones flying out, our detectors taking a look at this to give you a picture of the battlefield, fusing that all together. Then for human operators, you've got to be able to see through our fusus acquisition, we can bring in cameras from every Walmart, school, business, bank,

in a way that preserves privacy too, right? We're not talking about the police putting cameras everywhere, but any business or homeowners, like through our recent partnership with Ring, if you're a homeowner and your car was stolen, you can just be able to share that video seamlessly to police or police can reach out to the neighborhood and say, hey, some terrible thing happened in your neighborhood. If you've got video from your doorbell camera, share it with us and help solve that crime. We think bringing all of this together, that's how we make it

a world where it no longer makes sense to commit dangerous, violent acts because you're going to make me feel like it can happen, Rick. And by the way, I absolutely love you coming from your bat cave. I think it makes a lot of sense. Rick Smith, CEO of Axon Enterprise, a company that has been undervalued by Wall Street for 20 years. Rick, thanks for coming on. Thanks, Jim. I'll come back anytime. Nairn Bunny's back after the break.

Coming up, after stalling on the tarmac for years, is the stock of Boeing finally ready for takeoff? Kramer's looking at the airplane maker's prospects next. Ryan Reynolds here for Mint Mobile. I don't know if you knew this, but anyone can get the same premium wireless for $15 a month plan that I've been enjoying. It's not just for celebrities. So do like I did and have one of your assistant's assistants switch you to Mint Mobile today.

I'm told it's super easy to do at mintmobile.com slash switch. Upfront payment of $45 for three-month plan, equivalent to $15 per month required. Intro rate first three months only, then full price plan options available. Taxes and fees extra. See full terms at mintmobile.com.

Earn a business degree on your terms. At Capella University, our FlexPath format is available in select programs and lets you learn on your schedule. A different future is closer than you think with Capella University. Learn more at capella.edu. Here's a dreamliner of a story.

After years of struggling, Boeing's finally taken off in the last two months. The leading American aircraft maker has seen its stock surge from $128 and change on April 7th at its post-liberation day low, all the way to $209 today. That is a stunning 62% gain. This is not something that came out of nowhere. I told you Boeing was ready to make a comeback in March when the stock was at $181 because it had started reporting stronger orders and delivery numbers, as well as some surprise contract wins on the defense side. Of course, you had to have...

You had to keep the faith here because the stock got obliterated after Liberation Day tariffs, along with everything else, of course. But it's rebounded hard ever since. If you put it on my recommendation in March, you're up almost 30 points in less than three months. But you know what? Don't sell it. I think the stock has a lot more room to run. Why?

First and foremost, Boeing's cleaned up its balance sheet. Last fall, they raised net proceeds of $21 billion by selling common stock and convertible preferred stock. Then in April, they sold parts of their digital aviation solutions business to a private equity firm for a cool $10.55 billion. The plan is to pay down debt and focus on the core business of making aircraft.

Second, the numbers coming out of Boeing keep trending in the right direction. In late April, the company reported a solid quarter with slightly higher than expected sales and operating earnings that trounced the estimates. Boeing's combined backlog stood at $545 billion at the end of the quarter, with $460 billion for the commercial aircraft business, $62 billion for the defense business, and $22 billion for their often underappreciated services units.

Crucially, the company is still on track to ramp up production of its main aircraft this year. Matches said they expect to increase monthly 737 MAX production from the low 30s to the current FAA mandated cap of 38 within a few months and then request an increase to 42 later this year with the number possibly going up to 47 six months later. You know what? It could even go to the 50s if they do everything right. You know what? They sure seem to be doing everything right with that once troubled aircraft. Now, how about this for the 787 Dreamliner, which no one even thought about anymore?

anymore. Boeing is making five of these per month and they expect to get up that up to seven per month at some point this year. I like those clear milestones. So far, the leadership of Kelly Ortberg, this company has been able to stay on track, which is not something we're used to seeing Boeing do in a long time. A couple months into the quarter in mid-May, Boeing announced another strong deliveries number for April. Forty five commercial jets delivered nearly twice what they delivered in April of twenty twenty four. So the numbers have been great.

But there's a third thing that's been happening here. Boeing's likely to be a big winner from President Trump's global trade war. We know the president's obsessed with trade imbalances, rightly or wrongly. I think it's the wrong metric myself, but it's a metric he cares about. He's president, not me. If our trading partners want to close these trade imbalances quickly, the easiest thing to do is order some planes from Boeing, given that they sell for tens of millions of dollars a pop. But

Besides, everybody needs commercial aircraft. There's only one other company on Earth that makes them in scale. So it's not like they're losing out by placing orders with Boeing. It's something they'd probably do anyway, just on a longer time scale. Now, we're already seeing evidence that Boeing's a trade war winner. So far, Trump's only closed one trade deal since Liberation Day, and that's that new agreement with the United Kingdom. Alongside that deal, the parent company of British Airways, no consequence of Italy, agreed to buy $13 billion worth of jets from Boeing.

Plus, during President Trump's visit to the Middle East earlier this month, Qatar Airways placed an order for up to 210 wide-body aircraft, including 130 Dreamlars. That's the largest order for that plane in history. Now, there was a brief point in time where it looked like Boeing might get hurt by some aspects of the trade war. In mid-April, after President Trump paused the not-so-reciprocal tariffs for most of the world but raised the tariff on Chinese imports, it was reported that China would stop accepting delivery of Boeing aircraft.

It didn't really hurt at the time because Boeing said it could easily reroute those planes to other buyers. But they don't even have to do that because China dropped the Boeing ban in early May and deliveries will resume this month because they may have had to refigure those planes. That brings us to the present moment. And the last reason I think Boeing has more upside.

Last week, the investment firm Alliance Bernstein held its annual strategic decisions conferences at Big Deal, which featured conversations with a number of top executives, including Boeing's sure-handed, no-nonsense CEO, Mr. Ortberg. Oh, it was a very bullish presentation. Ortberg once again reaffirmed his previous 737 production ramp schedule. That's where we learned about the resumption of deliveries to China. Ortberg acknowledged that challenges remain on the defense side of the business, but reported positive progress there as well.

On Monday, a couple of days after that conference, Bernstein Aerospace and Defense Sector Analyst Team, led by Douglas Horne, named Boeing their top pick in the aerospace and defense sector. I think they made a very convincing pitch for the stock in their research. Other than things I've already mentioned, which they also cited, Bernstein made a very simple argument for Boeing.

They pointed out that when this stock gets going, it really gets going. Sure, in recent years, these sharp moves higher have been repeatedly undermined by tragedies, actions and various setbacks. And I haven't spent that much time talking about them because we all know them, but they're in the past. Now, though, the analysts believe that, and I'm going to quote here, we are on a much more sustainable path forward for Boeing. And like in past periods, the stock could take off very rapidly ahead of

actually delivering results, end quote. Then they add, quote, the odds of a real recovery happening are now much better than they have been during the last five years, end quote. You know what? I couldn't agree more. That's a pretty convincing momentum argument for Boeing. But that, importantly, is just the cherry on top of this story. At the end of the day, there's a whole lot going right for Boeing. And the stock has rightfully reflected its momentum these past couple of months. But here's the bottom line. With a cleaned up balance sheet,

rapidly improving results and the prospect of the president of the United States becoming the world's number one aircraft salesman as part of these trade negotiations, I think Boeing's got a bright future. And knowing how the stock tends to trade historically, I'm betting it could really still soar.

My only concern with Boeing is that they do have a not so great track record of dropping the ball just when the stock takes off. But I doubt that will be a problem anymore under Kelly or Briggs new leadership team. Boeing's on the way to restoring its greatness. And you want a piece of that promise as this one, once it gets going, can exceed any of the price targets that the analysts have ever dreamed of. Let's take calls. Let's go to Robert in New York. Robert.

Jim, how are you doing tonight? I hope everything is great. You know, Robert, things are really great. I mean, I got a lot of work, but we all have a lot of work. As long as I like it, I'm fine. How can I help you?

Okay, Jim. The next thing is this. This company that we want to talk about tonight offers generators and other power products for residential, industrial, and commercial use. Okay? Now, Jim, they reported revenues of last quarter of $942 million, up 5.9% a year ago, and outperforming analysts' expectations by 2.3%. Now, the business had a stunning quarter with an impressive beat of analyst ESP estimates. Okay. Now, Jim, this

This is very important. Please. You have this guy on your show. 70 to 75 percent of homes in this country do not use this company. 90 percent of the homes in this country do not own a generator. Did you know that? No, I did not know that. So we're talking...

People use this company. All the construction companies recommend this company. And you have the CEO, who is a master. He's a genius. Okay, let's hit it. The company is? Generac. Generac. Okay. All right. So Generac got hit by tariffs. As soon as you hear tariffs, unfortunately, the market runs. I agree with you that it's a great company, but I've got to tell you something.

It's not a great stock. I know you said a lot of good things. Absolutely. But the stock cannot rally if it's got that kind of tariff problem. But thanks for the start. All the nice things you said. Can we go to John in Florida, please? John.

How are you, Jim? Thank you. This is John from Florida. Jim, my question to you is, I've been watching the cruise industry, and I know your best of the breed is Royal Caribbean. Back in April, I started to pick up some Carnival, and it started to drop, and I think my average is around 18, 19. My question to you, Jim, I know their big drag is, their big cost is either labor or fuel. Mm-hmm.

Should I stay for the longer voyage? Should I get off at the next port? Look, I know you correctly nailed me and my view, which is that Royal Caribbean's the best. I frankly just have to own best of breed. I know that may make me into someone who's high bound. I might miss some good stocks. Carnival's good, but

But Royal Caribbean is great. And thank you for the interest and for the kind words. All right, guys, look, I think Boeing has a lot going for it right now. I'm going to revisit the story time and again because the future looks so bright for these guys. And knowing how a stock is historically traded, once it gets going,

Well, I wouldn't be surprised to see it soar even from these levels. We got a lot of mad money ahead. Consumers bouncing back or pulling back in the restaurant space. I'm sticking by forking Cracker Barrel to find out. Then I'm taking a bite of the CPG, that's the consumer packaged goods stocks, and checking to see what's ailing the space. And of course, all your calls rapid fire in tonight's edition of the lightning round. So stay with Kramer. All right. What the heck just happened to the stock of Cracker Barrel?

I've been following this folksy off-highway restaurant slash retail chain for a little over a year, and I started pounding the table on the stock last July after speaking to CEO Julie Messina. My thing is orchestrating just one heck of a turnaround. Initially, the stock had a fantastic run, climbing from the mid-30s last September to the mid-60s by the end of January. Of course, once Wall Street started worrying about the impending tariffs...

and the possibility of a recession. The stock rolled over, especially after Liberation Day. It's April lows. It came all the way back down to 33 bucks. Now, I told you that was an incredible buying opportunity. I hope you took my advice because Cracker Barrel is now up 38% since I last recommended it in April, climbing back to the mid-50s even after it got hit today. So this has been a big winner for us. But this morning, Cracker Barrel reported and Wall Street clearly didn't like what it saw. And that's why the stock tumbled over 7% today.

I think it was a solid quarter and the market's overreacting because Cracker Barrel's run so much over the past couple of months. Well, let me tell you what. First, the numbers. Technically, Cracker Barrel reported what I guess people would think is a mixed quarter with weaker than expected revenue. Basically, inline same store sales in the restaurant side, weaker same store sales in that retail side up front. But in terms of profitability, Cracker Barrel's doing great. They earned 58 cents per share. Wall Street was only looking for 21 cents. That's what I call a colossal beat.

Madden also adjusted its full year forecast for the fiscal year that ends in July. They maintain the revenue guidance and they suddenly raise their EBITDA outlook in part because they're expecting lower commodity inflation and lower wage inflation. On the conference call, Julie Messina said right at the top that the quarter started soft.

So her team adjusted quickly, taking actions, quote, to support the top line and tightly manage our expenses without limiting our ability to deliver our important fourth quarter initiatives, end quote. That's what's reflected in the numbers. Cracker Barrel's revenue and same-store sales were a bit squishy. But after the company recognized that and clamped down on expenses, it was still able to deliver a blowout earnings number.

And that's what good companies do. See, they don't just hope things get better. They adjust to the current scenario to ensure that they can deliver strong results no matter what. As Cracker Barrel's CFO said later on the call, while traffic started soft in February, the company, quote, saw improving trends in March and into April, which also benefited from a strong Easter. And, quote, Easter, some of these holidays mean a great deal for this company.

So the cadence of the quarter was encouraging. They also gave us plenty of detail on the key strategic initiatives on the menu innovation front. Management discussed a spring promotion with a couple of shrimp dishes, as well as an expansion of their pancake platform. Looking forward, Cracker Barrel's bringing back camp food.

fire meals this summer for the first time since 2018. And we all love those. Management's very excited about it. Management's also spent some time highlighting their extensive brand development work. Cracker Barrel is this key partnership with NASCAR. In fact, the Cracker Barrel 400 was held just this past weekend in Nashville. Hey, by the way, big win for Ryan Blaney, by the way. First of the season. But that's just the start of a larger partnership with NASCAR. I like it. These guys clearly know their core customer.

What else? The company's having big success with its loyalty program. Now, they have this goal. I don't know if you remember when Julie was on. They had this goal of hitting 8 million members by the end of the year. You know that they've already reached that number with a full quarter to go? One third of track sales are now associated with loyalty members. Always a good way to keep people coming back. Looking forward, Cracker Barrel wants to enhance the personalization of the awards program, including through the use of AI. And they've even seen some encouraging results from early tests of the technology. This company's so smart.

At the same time, management's trying to improve their in-store operations, both to boost quality and efficiency and to make life easier for its employees, something Messino and her team take very seriously. You've got to do that, having owned some restaurants. Let me tell you, it's probably your most important thing to do. In the quarter, Cracker Barrel implemented phase one of its back of the house optimization initiative. And Messino said they're, quote, pleased with the results and employee feedback has also been very positive as team members find the new processes easier to execute, end quote.

Now, ever since she started trying to turn the business around, Cracker Barrel has taken a careful approach to renovating the store. She talked about that here, too. These remodels cost a ton of money and they want to make sure they're spending it on something that actually brings in more business. But when asked about this during the Q&A section of the call, management said they're still in the testing and learning phase for store remodels. Apparently, we'll get more concrete plans in September.

Of course, not everything is going great for Cracker Barrel. There's this reason the stock really got punched today. As you can see from the same store sales numbers, the retail part of their stores is flattering a bit. Plus, Cracker Barrel will definitely feel the impact of the president's tariffs on the retail side of the business. Management disclosed roughly one third of its retail products are sourced directly from China.

and said that it added additional indirect exposure to tariffs via products from domestic vendors that also source from China. Oh, that's going to hurt. Krakow said they plan to mitigate the impact of tariffs through a combination of aggressively negotiating with vendors, finding alternative sources and possibly raising prices. But they still expect a five million dollar tariff hit in the current quarter. Not ideal, though. Keep in mind that the five million hit was baked into the race for four year EBITDA.

forecast. Frankly, I never cared much about the retail side of the business, which accounts for only 20% of the company's sales. But I can't ignore it, as any company that has gotten hit by tariffs bears a sort of scarlet letter going forward. We also know the Cracker Barrel is some separate improvement initiatives for the retail side, things like reducing the number of individual products that they carry and getting more thoughtful about the strategy for seasonal items.

as Cracker Bar used to set up their Halloween or Christmas merchandise needlessly early. Interestingly, management described the tariff situation as an opportunity to accelerate the things that it was already planning to do, breathe new life into the retail business. I've been there during Halloween season. It is a blast. Maybe it started too soon. I don't know. I loved it.

All things considered, I think this was another really solid quarter from Cracker Barrel, especially because, like many other restaurants, the quarter started with a slow February. Weather was bad around most of the country. While the stock gave back some of its recent gains today in response to the quarter, likely reacting to the softer sales numbers or perhaps the tariffs commentary. You know what? I'm not sweating it at all. With today's 7% slide, in fact, Cracker Barrel is going back to where it was trading less than four weeks ago. Here's the bottom line. When you see Cracker Barrel coming down like this, you know what I think? I think it's

This is a true turnaround story with a great CEO, one that I think will produce terrific results going forward. And even though the quarter wasn't perfect, the turnaround, it's very much intact. Man, buddy's back after 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 to start the lightning round, Chris. But that's where you take your calls back. We're probably saying the name of the song. I tell you what, I might say it physically. Play this out. And then the lightning round is over. Are you ready? Let's get that. Time for the lightning round, Chris. I want to start with Jake in New York. Jake. Yo, Jimmy Choo. Yo, yo. What's up?

Huge, first of all, huge shout out to the crew. Okay, huge, huge. Thank you. Lexus, Nexus, okay? What do you think about RELX? Oh, well, you know what? Finally, someone asked me about the old Reed Elsinore, which I've always liked. They're putting up great numbers. That's one of the reasons why people want to go to Europe to buy stocks. No controversy. Reed Elsinore, RELX, two thumbs up. Let's go to Larry in New Jersey. My home state, Larry.

Hey, Jim. Big booyah to you. Thank you. Thank you. Right back at you. I really appreciate your insights and color of the market. My question I have today is in a company, they do about 90 billion smokable products, 15% in smokeless products, about 7% out of beer. Defensive company, I always know, is Altria. It's not simply M.O. It's worth 6.7% dividend. From 40 to 60, they sell...

Okay, so I'm going to give you two answers to this. I'm trying to change my mind about some things. I'm a little more open-minded for my 20th year. I personally would not own Altair. Why? Because I don't like what they do. Is it a superior stock, better than most? The answer is, as I was writing how to make money in any market, the answer is yes. So you've got two answers. It's up to you. I couldn't own it for my trust. I couldn't live with myself. Let's go to Lamont in Tennessee. Lamont. Yes, Lamont in Tennessee. Hey.

Gorilla technology. What do you think about that? I mean, you're like you're you're way you're way over the video surveillance. We're going to do videos. I'm going to send you to Exxon. OK, let's go to Austin in Texas. My accent's so bad. Austin. Thanks for taking my call.

Oh, thank you, Austin. I'm trying to, I got to get that name right. I'm sorry. My accent's so horrible. Go ahead. Go ahead. Lincoln Financial Group, ticker is LNC. Well, that's Philadelphia's own. Boy, you really kept me, you cut me to the quick. You got my accent and then you, you drill me with Lincoln Financial. No, we're not going to recommend that stock. We're going to go, we're going to buy Chubb. Then I don't have to worry about how badly I pronounce it. Chubb is the one you want. Let's go to Scott, New York. Scott.

Yep. You're up, Scott. Hey, Jim. How's it going? Scott from New York. Couldn't be better. This is one of the greatest days of my life. One of like 40,000 great ones. Okay, what's up? Yeah, I was wondering your thoughts on E.H. Ehang.

You know, I'm not going to really want to do a lot of China right now. I think that the president and China just don't feel that. I just don't. I'm not getting that vibe. You know what I mean? And that, ladies and gentlemen, conclusion of the lightning round. The lightning round is sponsored by Charles Schwab. Coming up, can good things still come in smaller packages? Kramer's taking a look at the difficulties facing the consumer packaged goods companies. Next.

It's my pity the packaged good companies that rely on the consumer for a living because they can't seem to do anything right these days. There was a time when these stocks were beloved and they rallied hard when the same news is now dragging them down. It's really incredible how the market has turned on even the best of the best in this group. And the bad ones, well, they get buried alive in criticism. We learned this morning that Procter & Gamble, the unbelievably best consumer packaged goods enterprise on earth, plans to cut 7,000 jobs over two years.

This trimming the workforce would normally have to stop jumping. The market loves cutting costs. It would have been still one more sign that Procter will stop at nothing to keep profitability growing. In a good tape, we would have presumed that P&G is using cheap AI to replace expensive people. But now when we read the headline, we assume something must be really terribly wrong at the company and it gets hammered.

Then there's Kimberly-Clark. Today it took decisive action to cut its exposure to one of the most difficult businesses, its global Kleenex and tissue division, by selling 51% of the business to the Brazilian supplier, Suzano, for 1.73 billion. I like this. Kimberly-Clark gets out of a cyclical business

That has not great margins, and it's far more proprietary business, especially diapers, get to shine. I thought it was one more attempt by the gutsy CEO, Michael Hsu, to reinvent this company as a consistent grower, much more like Procter & Gamble. I figured the stock could rally a couple of bucks from the news. It was that creative a deal. Nah, the stock got crushed. It's down more than 2%. Crazy town. But the worst one?

Brown Foreman, the maker of Jack Daniels, which reported a truly terrible quarter. The House of Pay. Although if you read the press release propaganda, you might have thought everything's fabulous. Of course, when you look at the stock, which plummeted nearly 18% today, you will notice that it finished even worse than Tesla stock, which is saying something given the war of words between Elon Musk and President Trump, one of the worst spitball competitions I've ever seen.

The conference call from Brown Foreman, which used to be a terrific investment, was surreal. They took whatever they could find that was at all good, and there wasn't much. And that's all they really wanted to talk about. You'd think this whole company was wood for reserve, which was their best performing liquor. Of course, the analysts weren't buying it, not one bit. They could be a cozy lot, but don't ask them to drink the alcohol and Kool-Aid. The first questioner, Brian Spillane from Bank of America, wanted to know if the decline was more structural than cyclical.

CEO Lawson Whitey immediately came back with an honest enough response. Quote, I don't think there's a lot of nudist necessarily add to the conversation. I mean, I've seen more and more people. It's the same big three, the GOP-1s, cannabis and Gen Z. And we've been saying that now for a year and a half.

And then he goes on to say, we'd be naive if we didn't say that there isn't some pressure coming from those. But I still would argue that it is the consumer and their wallet just didn't have as much money in it. End quote. What can I say?

How about a Grand Slam? I think it's all four. Plus, there's the brand issue. Somehow Jack Daniels just isn't selling as the way as it used to. Hey, by the way, some goes for their biggest tequilas like El Jimidor and Herradura. Two mainstays that both declined 13% in the fiscal year that just ended in April. It's not their forte or a needle mover, but those are horrendous numbers. After all, one of the few bright spots in the entire liquor business is the agave spirit.

And a stink margarita. But it's not so bad for Brown Foreman. Amazing. As badly as they're doing in whiskey, they're actually doing worse in tequila. Wait, there's a silver lining. Whiting points out in the call that spirits continue to take share from beer and wine. Hey, no wonder Constellation brands tumbled 3.6%. The maker of Corona Modelo must be doing really badly. Maybe they're the benchmark of a bad alcohol business. Sometimes misery loves company. Sometimes you just hate a company.

And this market sure seems to hate the consumer package good space. Without growth, pure growth, Wall Street, it's having nothing to do with it. I like to say there's always a bull market somewhere. I promise I'll find it just for you right here on MidMoney. I'm Jim Cramer. 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, you can learn at your own pace with our FlexPath learning format.

Take one or two courses at a time and complete as many as you can in a 12-week billing session. With FlexPath, you can finish the bachelor's degree you started in 19 months and under $19,000. A different future is closer than you think with Capella University. Learn more at capella.edu. Fastest 25% of students. Cost varies by pace, transfer credits, and other factors. Fees apply.