Mad Money w/ Jim Cramer 04/25/25
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The U.S. and China are competing for global leadership. The country who wins will define the world we live in. U.S. international assistance is vital to our national security. It helps prevent terrorism and avoid costly wars. It fights diseases and saves lives. It helps keep America as the number one economy in the world. U.S. international assistance protects our interests at home and abroad. If America doesn't lead, China will.

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. Good morning, friends. I'm just trying to make a little money. My job is not just to entertain, but to teach you how it all works. So call me at 1-800-743-CBC. Tweet me at Jim Kramer. We made it.

Yep, we got through another stretch without the White House upending the whole market, which therefore led to the second best week of the year with the Dow finishing up 20 points. But S&P advancing 0.74%. NASDAQ gaining 1.26%.

But now we are about to go headfirst into the phalanx of earnings, the week where years are made. And it may be too much to ask for Washington to give us another quiet week so we can focus on the earnings of the best we have to offer. All right, look, we're not going to have to wait until Monday to find out what's up with the president. He's in Europe for the funeral of Pope Francis tomorrow. But there's no doubt that he's going to probably try to nail down some trade deals this weekend.

maybe with emissaries from Japan and South Korea. Hey, bears beware. If any country is willing to compromise with Trump, the rest of the world might fall in line. And honestly, if we can't win over Japan and South Korea, two countries where we have a ton of military bases, well, we might as well throw in the towel.

So many people are worried about a tariff-induced recession. Steel giant Nucor reports on Monday, and they're really at the crossroads of both. This domestic steel company, the best there is in the world, has been hammered by economic weakness, but they also directly benefit from the tariffs as they should. The world dumps steel in USA. It's been known for years. And if we didn't do anything about it, if we didn't protect our steel companies, we would have no steel. Nothing would be made in this country. So let's hear what they have to say.

Tuesday morning, we get results from another company at the epicenter of Trump's tariffs, and that's General Motors. Now, we're truly in crunch time for tariffs. It's not clear how much they'll add to the price of every new vehicle. But we know the stickers could be shocking. CEO Mary Barr always tells the story straight. Next.

I think UPS could give us the lay of the land in terms of tariffs pulling demand forward. We keep hearing that term on our show, right? And causing international disruption. Let's hope the news doesn't disrupt that dividend, which currently gives you a 6.7% outsized yield. On the other side of the economic spectrum, we have Coca-Cola. It'll be interesting to see if Coca-Cola can maintain its momentum. It's the only stock in the consumer products group that I follow that's still hanging in there after a

Brutal week for the cohort. Did you see PepsiCo? Holy cow. If you want to know my favorite trade for the week, it's going to be Spotify.

Now, this has this juicy subscription business. People don't focus on this company a lot. Lots of people ignore it, dismissing it as a radio station without commercials. But I think Spotify is all things entertainment, a competitor to Netflix for your time. Tuesday night, OK, I'm betting that Brian Nicol will spell out a strategy for Starbucks, both domestic and international. We've been stalled on this one for the travel trust with the stock first shooting up 30 points on Nicol's appointment.

and then giving almost all of it back when the numbers didn't turn around immediately and the market got ugly. I always thought that a quick breakout was a ridiculous assumption, but now the rubber's going to hit the road, and I still don't see a breakout quarter, but we're going to hold it nonetheless. And by the way, also, Tuesday night, Tuesday night, we have our Mad Money 20th anniversary show. You cannot miss the retrospective of the last 20 years of booyahs and bull markets on this show, and of course, a little smattering of bear markets, but...

I'm very proud of our team. We get to show the team with all its glory. Wednesday kicks off with Caterpillar, which should give us a sense of how much money is being left maybe in Joe Biden's infrastructure package. They technically only spent about 40 percent of it last fall. But Caterpillar is certainly not trading like a stock that has plenty of federal construction projects ahead of it, does it? Hopefully we'll find out after the close. All right, here we go.

Meta Platforms and Microsoft both important. The streets really split on these two. So many are worried about Meta's advertising business, but I think Alphabet's incredibly robust ad business should put those fears to rest. Microsoft's disappointed investors three straight times, three quarters in a row, mostly by issuing soft outlooks

after delivering solid results. Now, I think we need to see this co-pilot gain some serious traction while data center spending stays strong, but not too strong. We don't want them to spend even more than they thought. And Azure, its cloud business, gets back into an accelerated groove. That might be a toll order, but I think this company knows the penalty will be severe to its price earnings multiple, the PE multiple, if it misses a year's worth of earnings reports.

Now, we've got some health care, some issues to talk about on Thursday. That's right. These are anything but common, steady health care companies. We've got Eli Lilly. That's riding the wave of GOP-1 success. And then there's CVS, which is under new management, put up some really good numbers from Edna. And that's in health insurer. But also it's core drugstore business, which they've closed all the underperformers. Lilly's last report laid an egg.

They did it right on our show, unfortunately. I'm counting on this one being better, which is why we continue to own it for the Travel Trust. As for CVS, the health insurers have taken it on the chin of late UnitedHealth and Santin. Both missed expectations. I bet it sticks it.

Lots of restaurant stocks have fallen on hard times because of their price points. They just charge too darn much. But McDonald's rolled out some very cheap offerings, or I say cheaper offerings. I like them. And I think the customers have gravitated to the Golden Arches. We're going to find out for sure on Thursday morning.

After the close, Apple and Amazon report. See, look at these two days. Meta and Microsoft, Apple and Amazon. And no matter what we hear from Apple, I bet you there'll be a wall of critics ready to pronounce that these are Apple's last good results ahead of the tariffs. They might even be right. We own Apple for the trust, and we are not too concerned. Why? Because I believe these guys can work their way out of any abyss that is China.

It's just going to take some time and, of course, some money. I'm counting on CEO Tim Cook to spell out a trade strategy that includes the role of India in making phones. The export business has never been trickier.

But there aren't many people in this world who can handle it as deftly as Cook. As for Amazon, OK, listen up. We've been buying this one for the child. By the way, of course, you can just if you join the CBC Investing Club, you get my bulletins before we buy anything. I believe the retail world's undergoing this incredible consolidation toward the big three and the big three are Costco, Walmart and Amazon. I think all three can deliver on their promises. I'm not so sure about anybody else, frankly. Of course, Amazon's got major tariff problems with China. So we need to see what they have to say about that.

But I like what I've been hearing about the their business, the retail business X China. I hope that's good enough. One thing we know for sure, a few places are as strong for advertising as Amazon because it's right at that point of contact. I'm also very bullish in Amazon's international business. Nobody else is. I think it's finally beginning to generate some really serious numbers.

Friday's important, not just because we have Exxon and Chevron. And by the way, the two largest oil companies, and I doubt that they'll really have anything good to say because look at the price of oil. No, Friday's big because we have the Labor Department's nonfarm payroll report. And so much is riding on it. This week was so good in part because President Trump stopped hectoring Fed Chief Jay Powell after Monday. Let's hope that's permanent and not merely a temporary stay of execution.

We do need to see some weaker employment numbers so Powell can make the case for rate cuts down the line. Remember, it's mighty hard to cut rates when you're raising the price of everything imported by a pretty hefty sum. The Fed needs to walk a tightrope. I don't think they can afford to do anything right now, but they need to be prepared to cut at the next meeting if we see a big spike in unemployment.

Here's the bottom line. This is a really consequential week ahead. We're about to get into the weeds with tariffs. We have to sort out what's real and what's just mandated by the president. Most important, we need to see some trade deals, please. With them, the market can absorb some earnings disappointments. But without them, my anniversary show is going to be not as much fun and things could get really ugly very quickly after the run up we just had. Let's speak to Corey in Texas. Corey.

Hey, happy Friday, Jim. I'm a huge fan and longtime listener coming from Nacogdoches. I've been to Nacogdoches. It is dynamite, undervalued and dynamite. I love East Texas. What's going on? Awesome. Thanks. I appreciate that. Hey, I'm working on an investment portfolio with my sweet daughter, Harper, who's 10, and she wants to invest in what she calls girly companies.

Well, we've spoken on a few she knows, Lululemon, Bath & Body Works, Target. But one company in which she's very interested in a place, frankly, where she spends most of her money is Ulta Beauty, U-L-T-A. We want to know your thoughts on the company, Jim, and what you think the company is all about. I've been thinking a lot about it.

I've been thinking a lot about it. One of the reasons I've been thinking about it is, you know, that Sephora's in Kohl's, and Kohl's is doing so poorly that I think people are going to gravitate away from Sephora and come back to Ulta. Ulta's got new management. We have to check out the Ulta store that's in Midtown. I love going there. I'm with your daughters. I think they got horse sense. Let's go to Jake in New York, please. Jake. Happy Friday, Jim. Oh, Jake, you betcha.

Fishing and gardening this weekend. Real America. What's happening? So, you know, I'm thinking it's been best of breed right now. We got to focus on best of breed, right? You bet. More than ever. So I'm looking at Mattel.

Well, OK, you know, I like Mattel. I have them on, but I also have Hasbro on. And right now Hasbro is in the lead. They've got a bunch. They've got this card game that's really good. If you want to know, I'm not kidding. I'm not kidding about what I'm about to say. If you want to compare Hasbro to Mattel, I want you to go to Grok. I'm not kidding. Go to Grok. Because before I came out here tonight, I said, all right, why is Hasbro doing so well? I read the research. The best thing, the best way to find out is to go to Hasbro.

out. You just had to go to Gronk. Can you believe it? How good some of these sites are getting? It's amazing. All right, look, if we get some trade deals, the market will be able to absorb any earnings disappointment that may come through. Until then, though, it won't be a very won't be very smooth sailing, except on later this week when we've got my Mad Money 20th anniversary show. And I want everyone to tune in to see that.

Okay, on Mad Money tonight, shares of RestMed popped on its report this week. I got the medical device maker's top brass to learn more. What a hot stock. Meanwhile, IBM fell at earnings. But is this dip a chance to buy into weakness? I'm telling you where I stand. It's a little controversial. And later, speaking of controversial, could Scott's Miracle-Gro be a seed of opportunity in this market? Do not miss my check with its CEO. So stay with Kramer.

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The U.S. and China are competing for global leadership. The country who wins will define the world we live in. U.S. international assistance is vital to our national security. It helps prevent terrorism and avoid costly wars. It fights diseases and saves lives. It helps keep America as the number one economy in the world. U.S. international assistance protects our interests at home and abroad. If America doesn't lead, China will.

But the conversation on tariffs changing by the hour, it's very difficult to figure out how badly any individual company might get hit unless they're purely domestic operators. And that's why I was thrilled when ResMed, the medical device maker focused on machines for sleep apnea, reported a solid quarter on Wednesday night. And I think more important, management said they've gotten an exemption from President Trump's not so reciprocal tariffs. Exemptions don't come easily, people. Their machines are made in Australia and Singapore and they're off the hook.

This stock shot up 10% on Thursday. It could have more room to run. Let's check in with Mick Farrell, the chairman and CEO of RestMed, to learn more. Mr. Farrell, welcome back to Mad Money. Jim, it's great to be back on your show, and thank you for having me. Of course. All right, so, Mick, could you just, I mean, people are mystified by tariffs entirely, and yours in particular, because we were told that no exemption, no exemption, no exemption. I don't know how many times President Trump has said that. Can you tell me how things worked out and how this whole deal works?

Yeah, absolutely, Jim. Well, look, the history of this tariff exemption goes back for people with disabilities. And it starts in 1982 with President Ronald Reagan, who put this into place. It was reaffirmed by George H.W. Bush in 1989, actually, at a global tariff conference, global trade conference in a place called Nairobi, sometimes called the Nairobi Protocol.

There were some tariff issues. I don't know if you remember back in 2008, 2009, during the global financial crisis, we reaffirmed our tariff relief then with the Customs and Border Protection Agency, the CBP, and got a confirmation letter in 2009. And in this current situation, we went back just three weeks ago to the Customs and Border Protection under the current administration and reaffirmed that people with disabilities, which includes sleep apnea and other chronic respiratory diseases, will not be

be hurt by these and they have some relief. All right. Well, I'm glad because I think that there were a lot of people who felt that with no exemptions, there would be, uh,

shortfall or you would cut numbers. You didn't have to do that. And the stock went up very big. I want to talk about something. I don't know if you caught this morning show, but I said there are people who come on Mad Money and they say that GOP-1s mean nothing. And then as we get closer and closer to their broadest use, we find out that was not true. But you came on and you said they actually could be positive. And I for

I was skeptical, but I've known you long enough that I had to go with you. It's absolutely true. It actually has been working very well together hand in hand, hasn't it?

Yeah, look, Jim, you and I talked about this, you know, six months ago, 12 months ago, and we saw a dip in the stock maybe 18 months ago when there were rumours that GLP-1s would sort of be a panacea for cardiovascular disease, diabetes and sleep apnea. What we found is, look, there is some half treatment, if you like, of sleep apnea, but the gold standard treatment is CPAP, APAP and bilevel. And we're now tracking, we've increased the study that I talked about last time I was on your show. We're now tracking over one million patients.

with a GLP-1 prescription and a positive airway pressure device prescription. And we're seeing a 10% higher start rate like we did before, reaffirmed with a larger group of patients, a 3% higher resupply rate at one year and a 5% higher resupply rate at two years. So the curves actually start to separate.

And as we get deeper and deeper into this, I look at it and say, well, this is part of a broader approach to care. This could be like blood pressure medicines or cholesterol medicines. I welcome this new medicine. And in their own study, the leading company in this is Eli Lilly with Zepb.

their own study showed a positive impact of GLP-1s plus CPAP therapy having a better impact, obviously, than GLP-1s alone. And so, look, this isn't just me saying it. It's the clinical data saying it. It's the science saying it. And actually now, it's the real world evidence saying it. You saw our growth numbers on Wednesday. We were up 9% overall. Our devices were up 6% in North America, up 9% in Europe, Asia and the rest of the world. So there's no slowdown. And you look at the recurring revenue of patients on therapy,

14% growth in masks and accessories business. So we're seeing it in the science, we're seeing it in the research, we're seeing it in the business, and we're excited about the future. I can't wait to see what Apple and Samsung bring in terms of patients into the funnel with these wearables detecting sleep apnea, and what Eli Lilly and Novo Nordisk bring in by bringing patients back to primary care to seek new treatment. And then the gold standard for them in OSA is CPAP, APAP, Bi-Level. And the number one company in the world for that is Restman. Now,

I also think you're benefiting from a level of awareness that you didn't have. Doctors are now asking about something that, frankly, they didn't used to. Tell me about sleep. And the reason it's so big is because we've been unaware about sleep and the GOP-1s have made us increasingly aware of the importance of it.

Oh, absolutely, Jim. Look, I think, you know, our stock, as you said, went up 10% after we announced our numbers Wednesday night, went up 10% Thursday and was pretty steady today. So why is that? I think it's because ResMed is a compelling investment. And this noise around tariffs and GLP-1s,

ResMed has a very experienced management team. We went through the COVID crisis. I was on your show talking about ventilators, this time five years ago. Remember that, Jim? Yes, I do. Then we went through the supply chain crisis. And I came back and we talked about semiconductors. Could we get any from Intel or anyone, AMD, TSMC? And then tariff relief, we were able to show that. So I think number one is ResMed's a compelling investment in a storm. We're a very steady ship. Number two, we're an innovation machine. And

and we're an operating excellence machine. On OPEX Excellence, we improved our gross margin 140 basis points year on year this quarter. We improved it 70 basis points quarter on quarter from the December quarter to the March quarter. And in terms of innovation,

We're bringing products to the market like never before. I've got a little show and tell. I know I'm not in your studio like normal, but I've got this little thing. It's called the Night Owl. This is a home sleep apnea test. Look how small it is. This is mostly packaging. This here on the end, this little blue bit, the size of my fingertip, that is a home sleep apnea test that can qualify a patient for sleep apnea therapy. So ResMed's an innovation machine, point two. Point three, this is why I think we're a compelling investment. We've got a really strong balance sheet.

We're in a net cash positive position, pretty good in a market like this, and robust cash flow. We generated $1.6 billion in cash flow in the last 12 months. And just in the last quarter that we reported on Wednesday, $500 million in free cash flow. So we put that back into the business in R&D and SG&A and dividends. Well, look, Mick, you are a truth teller. Everything you said has come true. I love that. I know you're also a person who cares passionately about individuals' health.

And I always tell people that when I had a problem, I went to you that night out, by the way, would be really terrific versus what I did and was embarrassed by it, frankly. And I don't need to be embarrassed anymore. So thank you. Everything you've done for everybody who have sleep problems. I really appreciate you coming on. So that's big file chairman CEO of ResMed. Look at the performance of the stock people. This thing is monumental. Thank you. Have a good weekend. You too, Jim. They have my back.

The U.S. and China are competing for global leadership. The country who wins will define the world we live in. U.S. international assistance is vital to our national security. It helps prevent terrorism and avoid costly wars. It fights diseases and saves lives. It helps keep America as the number one economy in the world.

U.S. international assistance protects our interests at home and abroad. If America doesn't lead, China will. 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.

Yesterday, as the border market was seeing its third straight session of strong gains, one of my favorite stocks was headed in the wrong direction. IBM! IBM!

Down 6.6% in response to its earnings report the night before. Now, I've got to tell you, right from the get-go, I think the market got spun totally wrong. And I do believe also you're getting an opportunity to buy a big blue stock into weakness.

Keep in mind, after the company spent roughly a decade lost in the wilderness, IBM returned to growth a couple of years ago. They spun off their slower-growing legacy business as Kindrel, then doubled down on their Red Hat Enterprise software division that's become integral for enterprises that want to embrace AI.

Their tech consulting business has been roaring with lots of cross-selling opportunities. That's why IBM rallied 16% in 2023 before getting 34% last year. And even when the tariff turmoil crushed the entire market, especially technology, this stock held up surprisingly well. Going to quarter on Wednesday night, IBM was still up 12% for the year. Traversing the S&P 500 down 9% over the same period. And you know all of these tech companies that were involved with Generation and Gen.A.I.,

They got crushed. This didn't. Of course, yesterday it did sell off hard, though, but it's still beating the market. And more important, I think that sell-off was indeed a mistake. To me, IBM, I'm calling a steal at these levels. You know I don't do that very often. Why? All right, let's start with the numbers they're putting on Wednesday night. Even though Wall Street was not impressed, frankly, I was impressed. I looked at them and I said, wait a second, I like to look at earnings in a back

They delivered a healthy 18 cent earnings beat off a $1.42 basis, higher than expected revenue of 2% year over year on a constant currency basis. Their software business did great, up 7% or 9% in constant currency. Remember, the dollar's gotten weaker. But consulting was down 2% and infrastructure was down 6%. Nevertheless, all three divisions came in better than expected. IBM delivered some terrific margin expansion too, along with bountiful cash flow, much better than I thought possible. And I was talking to Arvind Krishna's people, I got to say,

This thing is a cash flow machine.

That said, right now, the quarterly results are a lot less important than the guidance, and nobody knows how to come up with a truly reliable forecast in such an insane environment. You know that. For example, IBM reiterated its four-year outlook, in part because they now expect to get a 1% to 1.5% revenue boost from, yes, that weakening U.S. dollar. That's a big change from January, when management expected to take a 2% hit from currency fluctuations because the dollar was relentless for so many years. As for the guidance for the current quarter, IBM is talking better than expected revenue growth of 4% to 6% year-over-year.

I've got to tell you, when these results cross the wire, I thought they looked pretty darn good. I mean, a solid revenue beat paired with a big earnings beat? In this environment, I know IBM really reiterated it's for your forecast, but that's pretty standard. It's what companies are doing. In many cases, this earnings season, Wall Street's treating a beat and maintain result as a big win.

The market agreed, at least initially. At first, IBM stocks spiked over 6% in the after-hour trading. I thought I got it right. For quickly reversing and moving lower and eventually falling 6.6% on Thursday. All right, what the heck happened here that transformed this from an up 6% quarter to a down 6% quarter almost overnight? I want to outsource this explanation. One of my favorite analysts, Ben Reyes, Ben was on, I don't know if you saw him, he was on Facebook.

Closing bell, not that long ago today. He's from Mellius Research, and I think he's the ax in IBM, meaning he understands it better than any other analyst. His view, IBM had been a huge outperformer going into the quarter, and the bulls may have gotten ahead of themselves. Even though the headline numbers were very good, the quarter wasn't perfect. There was a 350 basis point deceleration at Red Hat, which I've got to tell you, I found surprising. Their consulting bookings were down 9% in constant currency, and the headline numbers were saved by a weaker dollar. Okay. All right. Ben Reitz is still licensed, though.

Basically, investors have gotten used to bigger, cleaner beats from IBM over the past couple of years. So this quarter just didn't quite cut it. At the same time, Wall Street worried that the company will be hit by a higher tax rate, which makes it harder for analysts to raise their earnings estimates. You know, that makes sense. Makes sense to me. At a time when many tech companies and stocks have been performing so poorly, a lot of people piled into IBM as one of the few winners in the sector. And they wanted a quarter with a little less hair on it.

But overall, you know what? I'm inclined to stick with IBM here, especially after this big decline. I'd even be a buyer right now. If expectations were too high coming into the quarter, well, they certainly aren't anymore, are they? IBM is now trading just 21 times earlier. It's got a solid 2.9% dividend yield, a great rock-solid balance sheet. More importantly, when you look at the specific stocks in the quarter, I'm not worried about Red Hat's momentum eroding. While Red Hat only had 13% revenue growth, their bookings were in the high teens, according to management. In fact, IBM's

IBM explicitly said they continue to expect mid-teens growth for the Red Hat business, so it's going to come back. It's not like this software division crashed into a concrete retaining wall. I think it just hit a speed bump. Why should I disagree with these guys? They've been right. As for the consulting business, that's clearly softened thanks to the suddenly difficult economy. But still, I don't see anything that makes me want to throw in the towel.

While IBM's consulting revenue was flat in constant currency year over year, it still grew versus the previous quarter. And the company's consulting backlog grew mid-single digits with a lot of that coming from AI business. Here's how management put it on the ComScore. Quote, in consulting, we are encouraged by this quarter's sequential growth in revenue, our solid backlog up 6%, and our book of business in Gen AI. But given the current environment, we are appropriately more cautious on consulting's contribution to IBM this year. End quote. Works for me.

Plus, if you check under the hood, there are plenty of additional positives here. IBM's entering a big mainframe cycle this quarter still matters tremendously, which should give the lagging infrastructure division a nice boost. At the same time, they're not getting enough credit for the weakening dollar, which is going to make the company a fortune simply because they do so much business overseas.

Finally, I want to point out that IBM has proven its stock can work in multiple types of markets over the past few years. In 2024, we had a market that loved growth and tech and AI, and IBM outperformed. As the calendar turned to 2025, investors quickly pivoted to value, yield, and defense stocks. You know what? IBM still works.

At least until yesterday. Let's still be in the S&P for the year. For me, that inspires a lot of confidence because while we've been on the upswing this week, the market's become insanely volatile and we never know when the president will post something terrifying or we'll get some bad news about the trade negotiations that sends everything into a tailspin. Why does that matter? Because IBM's basically proven that it doesn't necessarily trade with the Nasdaq, which is why it held up relatively well during one of the darkest periods for tech in ages.

So here's the bottom line. IBM got hit this week despite reporting a pretty strong quarter. And I think it's absolutely worth buying into weakness here. The quarter was good. The business is good. Sooner or later, I bet the stock will be good, too. DJ in Texas, DJ. Hey, Jim, I'm calling about a stock that's been hammered before tariffs, hammered after tariffs and hammered after its most recent earnings. Is it finally time to buy Pepsi or should I stay as far away from this as possible?

Okay. No, no. Yield's 4%. It's a very well-run company. I think that Pepsi, I think you can start a position here at 16 times earnings. I think that they're going to right the ship. I do not think that Ramon Laguarta is going to just sit there and just say, you know what, I'm done taking this. I think he's going to make some moves. At 4%, with a 4% yield, I would start buying, and I had not been positive on PepsiCo for some time. Let's go to Luca in Illinois. Luca. Hey, Jim. Good afternoon. Good afternoon, Luca. I'm looking at your mind.

i'm looking at newmont and mother gold other major gold miners today and what this trend with many of the country but rather very like china even allied with japan and other central bank bumping the u_s_ dollar denominated assets and treasuries and both in others buying gold a record level amounts for the last few years

How do you see that impacting the price of gold compared to the value of the dollar? Let me go over the alternatives here. First, you can own a gold mutual fund or a gold junior mutual fund, which has a lot in the hopper, so to speak. You can buy gold, the actual ingots or bullion or buy from Costco. You can buy the GLD or you can buy Agnico Eagle Mines, which is the best of the golds. Start here.

It's been up a lot. It's up 51% for the year. Don't be aggressive until it comes down. All right, listen to me, people. I think IBM, which just sold off terribly, is absolutely worth buying this week. I don't buy the weakness story. I buy the strength story. I buy the fact that it's also in a great industry. Now, much more money ahead.

including I've got exclusive with Scott's Miracle-Gro to hear how the company's positioned amid a tentative consumer environment. Remember, I am a huge gardener. Then there's a big difference between a broken stock and a broken company. I'm telling you how this thesis is shaping up in the AI space. And of course, all your calls rapid fire in tonight's edition of The Lightning Round. So stay with Kramer.

All right, what's going on with the stock of Scott's Miracle-Gro? That's the big maker of raw and garden products. Now that spring gardening season is upon us, I wanted to look back at this one because for years it was tremendous growth stock. But then Scott's Miracle-Gro got into the supplies for the cannabis industry, which promptly turned into a quagmire and the stock spent years going lower. Now, though, that year is over. Scott's transferred its remaining cannabis-related holdings to an independent strategic partner earlier this month, which means we can go back

to focusing on the lawn and garden business, of which they are the number one with a pristine reputation, no matter how and whom I go to Home Depot. Now, Scott's reported in the middle of next, they report next week, okay? So the company's in its quiet period. We can't get into specifics of the financials. That's not the point. We can talk about that this is the weekend for planting and gardening. I think it's a great moment to refresh ourselves on the overall story and the state of the broader industry. So let's take a closer look with Jim Hagedorn. He's the chairman and president and CEO of Scott's Miracle-Gro. Mr. Hagedorn, welcome back to Mad Money.

Hello, James. Well, last time I talked to you, you outed me in my stocking toilet for years. So, yeah, we are working our way out of the toilet. That's for sure. Well, but I want to put it just because it's good to be back with you. Right. I just want to put it behind. It's good to be back with you. It's good to be back with you because you know what? I'll be going. I.

have been using your natural stuff, which I love. It is terrific. And people say to me, Jim, how do you get that look? Are you using chemicals? I have to tell him, Jim, I don't want to use the chemicals anymore. I use Scott's Miracle-Gro non-chemical. It must be a huge thing for you to have both, right?

It is. You know, business is great. I'll just tell you in regard to like this sanitized crap that my team gave me while I was in a board meeting this afternoon. What I'm supposed to talk about with you. No, no, but I can clear. We call report earnings within the time that I have to clear any FD issues. So we can just I think we just go off the grid and talk whatever you want to talk about. But business is good. It's been really hard work. We put a lot of expenses. But business

Our sales are double digits so far for those taff. And so far this month, it's even better. Wow. So things are going really, really well. Now, that doesn't jive with the negative thesis I hear everywhere. Is something is there something going on that making people do more close to home regard like I do that the most exciting thing you can do to the summer is your lawn and your garden?

look i think what's clear is that people want promotion i think when product is not on promotion it's kind of eh but retailers are working with us so hard to get consumers into their store that you know if you looked at our retail pos numbers they'd be called roughly flat in dollars but in its double digit units so retailers are using our products to bring consumers into the store

and our advertising is hitting right now in consumers.

I think they want to bargain, but they love gardening. And on the organic side, Martha Stewart is our chief gardening officer now, and she is absolutely fabulous. I hope you know her. No, I knew it. That was how I went. Candidly, that's why I went natural with you guys. I happen to adore Martha Stewart. She is the best. My wife and I think she's the single greatest person, inspirational person in business who is a woman in our lifetime.

Oh, I think she's a uber influencer. And I think her working with us has been like one of the greatest things ever. And she's really helping our business. She came to our board meeting yesterday and visited our R&D center and looked at a lot of her innovation. And she came out really happy. And it's really fun working with her. And she's totally with it. And, you know, she's like she's reinvented herself so many times. It's it's it's

one of the greatest women of all time. Yeah, well, I just think when she puts her name on something, it means it's the right thing to buy. She's our generation's good housekeeping seal of approval. Now, I got to tell you something about Martha. Absolutely. You know, so she's all about organic stuff. Right. And so I went to visit her house in Maine last summer and Carlos, her all around helper, Colombian guys, U.S. citizen, picked

picks us up and I said, yo, I heard Martha just uses organic. He said, dude, I feed all of her flowers. You know how much blue powder Miracle-Gro will use? It's insane. Well, she would only use the best. Jim, that's the way I look at it. Only use the best. All right, so how about, what's the tenor of the consumer? Do they want, you said they want promotion, but your stuff is the premium stuff. It's not the promotion stuff. So sometimes the consumer must be feeling a little better about themselves.

No. Look, if you look at retailers, basically all the retailers, when we were desperate like a year and a half ago for sales and we had to really incent retailers to buy our stuff, you know, I basically said I want my money back now that I'm not out of trouble. I want that margin back. And it's significant. Right. You know, it's hundreds of millions of dollars. And not only did they see Jim look great.

Have you heard our store counts now? We're not selling appliances and cabinetry and all that high-end stuff anymore, barbecues. Everybody bought that during COVID. We really can't give that money back.

but we'll spend it promoting your products exclusively. And so, yeah, we're not losing share. We're not losing share, Jim. We're gaining share hard. And so there are some of the biggest retailers in the country. They're only promoting our products. Oh, no. I'm seeing it. I'm seeing it myself because I went out to see Home Depot. I went to see 2,200 managers of stores, and your stuff's everywhere, which I think is fantastic. But, Jim, here's the thing. They're not only spending, and I'm talking...

really heavy duty money. They are spending more than that to bring people into their stores. And our advertising is hitting and their promotional dollars are hitting and the consumer is eating it up. And businesses is so far so good. That's great. Where I got myself in trouble with you last time is it was about this time, I think,

And business was good. And then it just, the weather got terrible. The weather got terrible. And you and I both know that. Tomorrow is supposed to rain, which is driving me nuts because I do not, I'll do some other stuff outside in the rain. I'm afraid to plant. But there's one last thing. We're not going to,

We're not going to talk. Sunday is going to be good. Yes, Sunday will be good. A little windy, but I know it's really weird. But, you know, we look hour to hour. We gardeners because there's only so many weekends. And this is huge. That's why I insisted on having Scots on. And because I don't have to talk about this cannabis thing anymore. That's off the table. Mostly off the table. It's like.

We burned $2 billion there, Jim. And so we're going to put the business into another entity, and we'll have equity in that, and we'll hope for the best. Well, look, all I know is that you are the best brand there is in the world.

And I am a gardener. This is going to be my 36th garden. And I've never strayed from your stuff, which is why I needed to have you on to begin the season as I like it. Jim Hagedorn, CEO of Scott's Miracle-Gro, the best there is. Thank you so much for coming on. Tell Martha I said hi, okay? See you, James. Ciao. Everybody's back into the break.

It is time! It's time for the lightning round. And then the lightning round is over. Are you ready, Skid Day? It's time for the lightning round. I'm going to start with Sharon in Minnesota. Sharon!

Hi, Jim. I have been following you since the late 90s, and that's when I started trading stocks, mostly in the tech arena. But I have a question about arm holdings. I just bought in February of 2024 at 120. Okay.

And, of course, it's gone up and down. And now I'm trying to decide if I get out or... No, Sharon, I want you to stay in it. Rene Haas is doing a great job. I think that this whole semiconductor group has been oversold. It will bounce. And when it bounces, you want to trim back because it is expensive. That's fine. Do not sell it here. Let's go to Gregory in New Jersey. Gregory. Gregory, you're up. Hello? This is Jim, Gregory. How are you doing? I'm doing well. How about you, partner? I want to say, I'm doing well. You gave me the corner RTX.

When they had earnings at 90, I held it all the way to up to 120. I appreciate that. My question is MSPR, but more importantly... Oh, Mr., the old Mr. Trazzy. No, no, look, we like Bitcoin. We actually buy Bitcoin. That's what we do. We want Bitcoin, we buy Bitcoin. Let's go to Teresa in Minnesota. Teresa.

Hi, Jim. First, I want to thank you for everything that you do for us individuals. Thank you. Be sure to watch our special next week. I think you might get a kick out of it. What's going on? I have a question concerning one of my longtime holdings. I've done very well with it, and I'm retired now. But there's going to be a CEO change, and there's some lawsuits.

So should I go ahead and buy more or should I just hold? My stock is BHP. I like BHP. I remember it was Broken Hill Properties. That's how old I am. Holy cow. But I like the story. I like the yield. I think you got a good situation going there. And that led to the lightning round. Three months ago, January 23rd, is a day that will live in artificial intelligence infamy.

That's when we learned that a Chinese firm called DeepSeek had figured out a way to train high-quality generative AI models using far less hardware. They claimed their hardware costs were around $6 million versus $80 to $100 million for their enormous American competitors.

Yep, DC's R1 rocked the whole world. Nvidia's stock plunged from 147 to 118 over the next two trading sessions because they make the brains of this now expensive hardware. The contagion then spread to Supermicro, to Broca, Marvell Tech, and then diverted the guts of the data center. And then that dragged down the entire NASDAQ.

It was a Sputnik moment when the Russians were first to fire a rocket into space back in '57. We were hopelessly behind. Our clumsy, expensive NVIDIA hardware defeated by the cheap Deep-Sea. All of a sudden, the Chinese are taking the lead in AI while our companies were supposedly spending like drunken sailors, and for what?

Do you know the AI stocks never really came back from that? Because Wall Street gave up on the entire theme. After all, the great AI investment theme was suddenly in jeopardy. DeepSeek made it sound like spending billions on NVIDIA chips was just a waste of money. Bring on the cancellations!

Fast forward three months, and even though the AI stocks have done very badly during this period, we're beginning to rethink everything that turns sour because none of those deep-seek worries has come true. None. We aren't seeing the cancellations. One by one, the hyperscalers have proclaimed fielded NVIDIA and the great data center build-out. Only Microsoft has really scaled back, but I think that might actually just be because they offloaded some of their capital expenditures to their partner, OpenAI. Then, best of all, last night,

Alphabet gushed over its relationship with none other than NVIDIA, with CEO Sundar Pichai claiming that the amazing chip company, I'm going to quote, continues to be a key advantage for us and our customers, end quote. Pichai went on to say, quote, we're the first cloud provider to offer NVIDIA's groundbreaking B200 and GB200 Blackwell GPUs, and we'll be offering their next generation Vera Rubin GPUs, end quote.

Can you imagine? We don't even have the Vera Rubin ship yet, and they're already crowing about it. This endorsement comes right after a key data center supplier, Vertiv, swore to us on our own show that the build-up is not only continuing, it's actually accelerating. Yes, accelerating. It's a crunching from the fourth quarter to the first quarter. Turns out DeepSeek didn't derail anything. If anything, things are accelerating. All aboard! Which brings me back to NVIDIA. This stock's still down 36 points from where it was trading before the DeepSeek news broke.

Sure, it rebounded from a low of $86 earlier this month to $111 today. But at these levels, they have 42 points from its high? The stock of NVIDIA still reflects a deadly deep-seek torpedo. The darn thing sells for just 25 times earnings, for heaven's sake. So why is that? Why don't we trim some for the terrible trust? Okay, I've got to tell you. You're speaking to someone who still owns a lot of NVIDIA for the trust, and a lot of the negativity that we felt, and others have too, has come from the White House, where NVIDIA has become a political football.

The company had been made. They've been making these dumbed down AI chips from China. It's a suggestion the Biden administration. CEO Jason Wong met with President Trump and we got word that NVIDIA was going to produce 500 billion dollars worth of AI infrastructure in America over the next four years. Everything seems so cozy until we learned that the White House has banned them from selling any AI chips to China. NVIDIA had to take a five point five billion dollar charge on the entire program.

But man, NVIDIA's business never really deteriorated. We understand they're basically sold out for the year, even as they can only sell their best stuff in the United States and 18 friendly countries, something Biden cooked up and Trump has yet to reverse. I'm worried he might actually make it more restrictive. Still, there's so much demand for NVIDIA's merchandise that the stock never should have been crushed in the first place. Even with the trade war, the AI infrastructure theme seems totally back on track. In fact, it never left the track to begin with. NVIDIA was boxing against shadows.

At the end of the day, NVIDIA is a broken stock, not a broken company. Good news, because broken stocks are a lot easier to fix. And this one is shaking out a lot of people who bought the stock without ever knowing what the heck NVIDIA really does. I like to say there's always bull markets on my promise. I'm finding just for you or your money. I'm Jim Cramer. See you Monday.

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