Mad Money w/ Jim Cramer 1/2/25
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I'm here to level the playing field for all investors. There's always a home 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. As with my friends, I'm just trying to make some money. My job is not just to entertain, but to educate, teach you about all the crazy stuff that happens here. So call me at 1-800-743-CBC. Tweet me at Jim Kramer.

Have you noticed the extreme negativity seeping in already? Even when the stock market was up nicely this morning before the midday swooned to close, Dow finishing down 152 points, S&P declining 0.22%, NASDAQ losing 0.16%. All I heard was that, well, we've been up big for two straight years and we're due for a pullback. Sell, sell, sell. Or

These are perilous times like the 1930s, high tariffs, collapse, and world trade coming. The 10-year Treasury heading to 5% because of inflation, ineffective Fed, overextended stocks. The bull on its last, last legs.

Sure, sure, I get it. But being a bear is easy in this business. If stocks go up, no one will remember your negative prognostication, right? If stocks go down, you'll be a seer. We will sing your praises, worship you. You'll become the big get, paraded out every time the market goes down big because you have street cred. And you see that bear go, blah! You know what I'm saying? Blah! I love that thing.

You know me. Sure, the day was disappointing. Kind of like last week. But I want to tack the other way. I want to tell you what could go right. Give you 10 things that might cut in favor of the Bulls. All right, they're not rip snorers. No tramping the bear's hair. Just some things that, well, let's say they make me want to be a little more positive than the others. I need to tell you what can go right because nobody else is.

You know what I like being alone. Some of the best moments of my vacation just ended with being alone. Just kidding about that. First, the booming of Biden's antitrust regulators as the FTC and the Justice Department, that will be fabulous! Fabulous for the market. The party FTC chief, Lena Kahn, she seemed to despise every deal and truly abhorred all big business, no matter how great it might have been for the economy or for you or for the average worker.

She is, in the end, way over her head. Her swan song? A case plot that will raise the price of alcohol for everyone if she wins. Perfect. Nice, calm, and touch. A real asset to President Biden. But then, out of the way, we'll see a huge number of deals that will help rationalize entire industries, allow smaller companies, banking, retail, materials, entertainment, enterprise software, pharma to compete against the big dogs. Fantastic for the stock market. Just fantastic.

The end of Lena Kahn's know-nothing FTC is a welcome development another way. You know that we've had a developing shortage of equities? We aren't getting any big IPOs, at least not yet. But if we do, I am confident that M&A will take enough stock out of the market that we'll still have a shrinking share count. Always remember that the stock market is indeed a market. And like any other market, when there's not enough supply, you get higher prices. Third.

What happens if Trump's tariffs turn out to be negotiable? What if they're more steak knife and less meat axe? A smart, non-smooth-holy program won't be great for world trade. But then again, America elected a pro-tariff president. If you own stocks and you want them higher, you have to hope for negotiable tariffs that could cause countries to lower prices to us or make multinational companies move their manufacturing base here to a friendly, more friendly country. Classic case.

Constellation brands. OK, a stiletto tariff policy would not force Modelo or Corona to be made in Toledo, Ohio. Fourth, housing breaks price. We're already seeing what happens when there's overbuilding, as is the case in Florida. Prices come down. When mortgage rates go up, what happens? Prices go down. Once prices come down, you know what? Buyers start staying away, hoping for still lower prices. And it usually works, causing sellers to panic, furiously cutting prices themselves, lest they'd be stuck and can't move.

It's called the cycle, although it hasn't been operating normally for the last few years. I think 2025 will be the year that the cycle reasserts itself and the Fed will win big on this one. Big enough to be able to cut rates slowly, but cut nonetheless, which of course is what we need. And that's why these home building stocks keep coming down. It's way too early to bottom fish there.

Fifth, we need to hope that Bobby Kennedy Jr. decides to go after foods that are bad for you as opposed to vaccines that are good for you. The makers of the GOP-1 weight loss drugs better have some pretty good data on hypertension, cardiac indices, maybe dementia, even cancer if they're going to get Kennedy on the other side. Otherwise, he will just say no to mon giorno. I just want to call him that from now on because I think it's really funny. Yes to diet and exercise. That's what he wants. I think it'll turn out that pharma hit bottom ahead of the appointment taking effect.

Buongiorno. Oh, come on. I have vacation. I'm having a good time. Give me a break. 20 years of this. Let me have some fun. All right. Six potential positive. We start seeing some real AI wins, not just small expense cuts because of it. Maybe we get some true data on how to stop cancer. We create new devices that be hard to kill diseases. We learn to map the brain to solve neurological problems. We unlock health care as it's never been because, well, we'll have modeled every major attempt to fix the body and how every protein reacts to it. Seven.

Seven, AI gives us robots that are programmed so well that they can do the work of five people, which could prevent a monster wave of wage inflation from Trump's proposed deportations. Robots will place people in restaurants, retail, home building, transportation. They'll be unloading the trucks, medicine, insurance, credit card call centers. Sounds harsh, but Trump won the election running on a hard deportation policy.

Assuming he pushes that through, we'll either have massive wage inflation or widespread automation. I prefer the latter. Eight, President-elect Trump declares the federal interstate highway system a full self-driving zone, and he accepts data from Tesla that allows the company to jump way ahead of Waymo and become the national self-driving car. Big win for Elon Musk. Nine, the federal government endorses Starlink as the official internet system for the country, and Musk's combination satellite phone and internet services cost $60 a month. Big win for Musk.

This Starlink is amazing if you haven't tried it. It's a very tough competitor. Tenth, we get used to stocks trading in the trillions. It's not an aberration anymore. Right now, there are way too many people who think it's really outrageous for so many companies to be valued over a trillion dollars. Meta, Alphabet, Amazon, Apple, NVIDIA, Microsoft, Tesla, the usual suspects. These stocks could all have a big surge from here if we simply keep getting more money going into index funds.

That's what really helps propel these, not just the businesses themselves, even as the businesses are phenomenal and deserve the premium. There you have it. Ten potential positives. Of course, I could have run a whole segment the way most people want to hear. Trump's tax will bring massive inflation, which will cause the yield in the 10-year to go through five trillion worldwide depression like 1933. I could have suggested mass deportations will drive up wages to the point where the Fed will have to raise interest rates. I could have said the MAG-7 are out of control and will become a huge source of funds. Apparate 7, let day lose. Rawr!

Oh, come on. Anyway, I know I could have said Apple, NVIDIA, Microsoft will miss numbers, that enterprise software will crater from competition, that one of the auto companies will go bankrupt. Or maybe I could just tell you the pound-tier gets cut in half and Bitcoin goes down to $50,000. But the problem is, well, here's the bottom line. I don't believe those negatives will happen. So if you excuse me, I don't want to offer Cassandra. I'll let everyone else do that job. They are much better at being pessimistic than I am. Let's go to James in my home state of New Jersey. James!

Hey, Jim. Happy New Year to you and the whole team over there. Oh, thank you, James. Yep, and the group is so good here. You know, they are every bit as good in 2025 as they were in 2024, and that is saying something. All right, so listen, I bought a stock a couple years ago, planning to hold it for many, many years. Problem is, it's run up so much on me, it's now 20% of the portfolio. Can I stick to the plan and hold it, or do I need to trim some meta right here? How much of it...

20%? Okay, let's say you have 10 stocks. I'm okay with 20%. I think Meta is an up stock. It's going higher. I'm not going to tell you to sell it. If it gets up to 30, 25, 30, I would tell you to cut back, but I think Meta's okay for you. Now, for the Chappell Trust, I wouldn't let anything go above 5%, but I got a lot more stocks. I think that Meta's going higher. Let's go to Chris in Massachusetts. Chris.

Hey, Jim. Chris from Mass. How you doing? Love your show. Oh, thank you. Happy New Year, my friend. Happy New Year. Right back at you. Thank you.

Let's talk DraftKings. I've been holding on to this thing since 2020. It seems they can't get out of their own way, Jim. A lot of headwinds with this stock, right? Lawsuits, no insider sales, no purchases in 2024, state tax increases.

I mean, is California going to come on board? It needs California and Texas. You just said it right. I mean, it's an anytime touchdown if you get California and Texas. Right now, it's kind of like a 14 parlay and you get the three right, but you never get the fourth. What can I say? That's how it feels. And they do need those two states and then you'll be OK. Let's go to Keith in Florida, please. Keith. Hello, Jim. Hello to Wall Street Bets. What's your opinion on Robin Hood this year?

Robinhood is another stock that I would tell you they've got to get a little more diversified. Their client base is really into crypto and options. They need to do more than that. That said, they're just lapping all the other brokers. They understand what young people want. And the other guys are running. I don't know. The other companies seem to be run by guys like me that seem to be too old to understand. I'm young at heart. I think what Robinhood does is really, really fabulous. And the other guys should have been able to figure that out, too. And they just haven't. Kind of embarrassing to think about it.

Look, I could be a negative Nelly or Nancy or whatever about this year, like the major averages were today. But I need to tell you what I think can actually go right because nobody else is doing it. On Mad Money tonight, I'm ringing in the new year by breaking down the biggest winners and losers in 2024, starting with the NASDAQ 100. Then can stocks like Walgreens and Estee Lauder craft a comeback in the year ahead? I'm looking closer at the S&P 500 stocks that led and lagged the pack.

And later, I'm digging into some dividend stocks that could buff up your portfolio in an uncertain market. So stay with Kramer. Don't miss a second of Mad Money. Follow at Jim Kramer on X. Have a question? Tweet Kramer. Hashtag Mad Mentions. Send Jim an email to madmoneyatcnbc.com or give us a call at 1-800-743-CNBC. Miss something? Head to madmoney.cnbc.com.

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We don't have many years like 2024 where everything seems so obvious and the obvious winners actually hit the jackpot. But that's what happened last year. If you try to get creative, you try to get clever, you missed out on some truly idiot proof winners. The losers, on the other hand, well, they were not as easy to spot because in many cases they were the market's former winners. Even if they'd long ago lost their way.

Like every new year of Mad Money, we probe what went right and what went wrong in the previous year by looking at the top five and bottom five. First, the Nasdaq 100, which outperformed, and then the S&P 500, which finished slightly below its more high-tech comrade.

When we sit in our bullpen working on the show, a bullpen that feels like some sort of old-time sitcom, we curse at certain stocks for how overly loved they are, knowing that one day there'll be a better mousetrap and you'll wish you had gotten off the spaceship before a crash and a burn. Last year, that stock was app-lovin'.

The best performer in the NASDAQ, which places ads in mobile video games, among other tasks. Of course, they use AI and advanced algorithms to target their advertising. Of course, they do a great job. Of course, there is none better. Until, of course, somebody else comes along with something cheaper, stronger, more powerful, and more app-lovable. And that's why 8% of the company's shares are sold short. People know that competition is inevitable. Honestly, I think Google dominates this space in a heartbeat. They won't worry about the Justice Department's antitrust division, although those goons will soon be broomed.

I'm betting 2025 will be the year when venture capitalists start funding proposals for Apple of an alternative, which, while I can't endorse the stock here nearly 60 times this year's earnings estimates. But try telling that to the true believers who set it up 713 percent last year, another 5 percent, 5.5 percent today, which, frankly, I find utterly ridiculous. I mean, enough Apple of an already.

As for the second best performer, I honestly don't know why this micro strategy is allowed to exist. I mean, really, here's a company that's making a leverage bet on Bitcoin. That's what it is. It's an investment company. I think it should be a regular one. That's a software company. But we're in a world where nobody cares to hear about any crypto regulation whatsoever, especially now that we're about to have like a real crypto friendly president.

And that's how it advanced 359% last year and will probably go up again. Listen, I like Bitcoin. I own Bitcoin in part because I can't own stocks. If you can't, if you can own stocks and you believe in Bitcoin with all your heart and soul, then feel free to buy MicroStrategy. It's Bitcoin on steroids, but not that much more. Most obvious winner for 2024, Pally.

Palantir, the defense software company trying to revolutionize the way the Pentagon works. Its CEO, Alex Karp, is a brilliant bad boy, smash mouth, Philly guy who's like a meaner version of Elon Musk and probably threw snowballs, if not batteries, at Santa Claus from the lower level of the link.

I think Palantir up 340% for 2024. Can't have another breakout year because the most doge unit part of government officially will work hand in glove with these guys. They're all part of the same circle. They understand the procurement process. They will win a lot of business in 2025.

Volunteer, yes. Next up, we played a fun game at Tom and Lori's place on New Year's Eve. We had to draw another person at our dinner table, and then people had to guess who it was. I'm easy to draw, but I was not alone in my hairline. I was alone, though, when it came to the bubble out of my mouth that said, yes, buy, buy, buy. NVIDIA, the stock was up 171% last year. And also, by the way, had a very strong close today of 4.3%. Of course, for a decent chunk of the year, there was a lot of worry.

about a late product and a fractious client base that wants to design its own chips because NVIDIA's cost too much, even as the return on investment is really large here. Believe me, if I thought anyone could touch NVIDIA's products and platforms, I'd be happy to say sell half. Sell, sell, sell.

and book the gain. But I can't justify that because this company is peerless. Frankly, the biggest thing working against the stock is the terrible way it trades. Give you a huge clumps if you're making soft climbs for any other company. I'd say abandon the stock, but Nvidia's products are too good, too indispensable, and its CEO runs harder than anyone else I've ever met. I expect a great speech from Jensen Wong at CES next Monday, but please read my CNBC investing club bulletin today about my latest move on the stock. Finally,

Finally, there's Axon, the body cam and taser company that owns the software as a service model for the local criminal justice system. I wish I had specifics about which jurisdictions are taking their package, but the growth continues to be shockingly strong both here and now overseas. Maybe there aren't enough analogs, but I always feel like Axon doesn't get the attention it deserves from the analysts. I've liked it since it was taser. T-A-S-R. And I like it even more, even as the stock's up was up 130% last year. It needs to split to keep rolling them. Hey, there's

Hey, there's a real good collection of winners. I really like those stocks. The NASDAQ 100 losers, though, they aren't so horrible as the declines would make you think, but they got clobbered because they were emblematic of golden calves, worshipped for a long time before being revealed as not so special after all. Kind of like the false idol Edward G. Robinson worshipped in Kramer Faith Ten Commandments. If you don't know Robinson, my colleague David Faber does a great imitation.

Let's start with something critical. Intel and its financial situation. Intel is a national treasure, people. It can't be allowed to fail. Too dire a possibility? I don't think so. Its balance sheet is a mess. Its product line isn't good enough. I don't know if it can deliver on many of its promises to the government. Sure, nice guy and messianic former CEO Pat Gelsinger is gone.

But so what? Intel needs a plan in 30 days. So the stock will keep coming down even after last year's staggering 60 percent decline. Intel's too big to be bought, too indebted to be finessed. It's a we close situation. The risk is existential.

Second, MongoDB, down 43%, is the excess of enterprise software or still one more company that helps you develop applications, data modeling, blah, blah, blah, blah, blah, blah, blah. 2024 was the year we turned on enterprise software simply because there are too many companies doing the same thing. So if you have one bit of slowness, you're regarded as a dead man walking.

MongoDB is a pretty good company, but it's 72 times earnings. No, thank you. It was a big today. Hope springs eternal. Sell, sell, sell. Third, Biogen has been running on fumes while it works on its Alzheimer's drug, but the fumes, basically a very good MS drug in a crowded field, aren't enough. Not with the unmet projections for its Alzheimer's formulation or competition come from Eli Loy. Hence, the stock's 41% decline. Biogen's traveled too close to the sun for too long. It feels real burned out here. Fourth, for years, Dexcom.

Just be a steady, steady climb for the show. This stock's been hurt. And I think a lot of it is because Abbott's blood sugar monitoring device may be better, even as Dexcom's device is twice as expensive over the course of a year. Not necessarily better, but more cost effective. By the way, it's one big reason why we own Abbott for the travel trust. That stock's very cheap, given how great the company is.

Dexcom in the most recent quarter, well, let's just say it gave you an inline forecast and a disappointing just 2% decline. Ooh, a decline in U.S. sales. The numbers from the second half of 2024 shocked people because Dexcom doesn't miss. And the explanation, some sort of sales reorg?

just didn't cut it. So the stock finished the year down 37%. I am still mystified by what happened here. Finally, there's microchip. If you want to exhibit A about why the Fed needs to keep cutting interest rates, it's microchip. This semiconductor company has the misfortune to make chips for the auto industry, meaning they'll have a terrible first half without some help from the Fed. Hey, memo to all, the autos seem to be in real trouble here if rates don't come down. Stay away from that group.

Obvious advances and declines all the way. See what I mean? Bottom line, let's hope 2025 is just as straightforward and Palantir hits another home run. A strategic Bitcoin reserve drives up MicroStrategy. Nvidia delivers on its new chips. Axon keeps winning jurisdictions. But AppLovin gets some long-awaited AppHatin. Because I can't bring myself to root for that last one. Mad Money is back for the break.

Coming up, Kramer is diving into the best and worst stocks of 2024 in the S&P 500. Next. If your small business has a problem, you could say, Ugh, just my luck. But you should say, Like a good neighbor, State Farm is there. And we'll help get you back in business. Like a good neighbor, State Farm is there.

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The biggest winners of the NASDAQ were obvious this year, but the winners and losers in the S&P 500, they're harder to predict, especially if you exclude Palantir, NVIDIA, and Axon, as they also made the cut in the NASDAQ 100. The rest of them were far from obvious, and they had astonishing staying power. So let's skip Palantir and start with the second best performer, which is Vistra, up 258%. Vistra is the largest competitive generator of electricity in the country and the second largest nuclear play, thanks to an acquisition, very smart acquisition, made last March.

We have a shortage of clean power in America, and we need more of it to support the big data center build-out. Let me say from the outset that I'm starting to think this move is getting to be absurd. Vistra's like a stock created for the moment, the visible way to play data center expansion. If I come back and say Vistra, Edith Stoppelganger, Constellation Energy are utilities with no real ability to scale at the level that the stocks would indicate, although Constellation got some big contracts from the feds,

that could help them add more nukes if all goes well. I say don't be too greedy with Vistra, please, because the aura will disappear once people realize that it doesn't have the ability to grow fast enough to back up this move. It can go higher, but it is starting to give me a nosebleed.

Number four, simply astounding. It's United Airlines. For the first time in my life, I've seen a trade morph into an investment. And that's what United did. The stocks up 135 percent rally occurred. Well, once the airline started removing capacity, United cut back three percent of its promised midyear capacity. I couldn't believe it. Of course, I can't explain the whole run. Problem with Boeing, the production there kept some airlines from being there were capacity constraints. They couldn't get the planes they needed.

Plus, the long-on-money, short-on-time thesis that burst on the scene post-COVID never really quit. Oh, and get this. United still sells for less than eight times this year's earnings. It can actually power higher. It might be a good buy. I would wait for a 5% to 8% pullback. You notice the chart looks like it's kind of rolling over. Because we excluded three of the top five as we covered them in the NASDAQ analysis, let me give you three more from the S&P. Number six, Texas Pacific Land Coverage.

Corp. Now, this is a strange, out of this series of tracks from a bankrupt railroad that sit atop vast quantities of oil and gas in the Permian Basin that we covered. And I'm proud to say we really kind of nailed this. But stock kept going higher. The stock finished up one hundred and eleven percent. But at one point it was much, much higher. I think the oil trade will be hurt by excess drilling, something that will over.

It always seems to happen when we get a fossil fuel friendly president. Now there are better stocks. I like Cotero for the charitable trust because it has both natural gas and oil. Better bet, I think it's breaking out here. Number seven was generally obvious in true NASDAQ style. I'm talking about Broadcom, symbol ABG, up 108%. Now we had CEO Hawk Tan on the show when we were in San Francisco.

Not that long ago. And he laid out a vision where his company would be making a killing from the data center. It's very rare that you have a totally bankable exec come on your show, telling you exactly what will happen, and then that executive delivers 100%. He's greeted with disbelief, a giant upside surprise, and a gigantic move higher. He said it all. Plus, I think Broadcom's in inning one of this turn. It's not too late to get on board this one. We have a nice slug for the Travel Trust. And by the way, I talk about it all the time in our 1020 CBC Investing Club morning meeting.

Finally, there's Targa Resources up 105%. Now, here's a natural gas pipeline company. Maybe the key to keeping the Permian growing because there's too much gas in the Permian that needs to be taken away. Can't be flared. Targa has both the pipes and the ability to fractionate natural gas liquids. While it's not a liquefied natural gas company, it was believed to be a big loser when President Biden announced that pause in LNG construction a year ago. That pause is over and it

And it, well, I think it'll be lifted immediately. And that will lift Target even more. By the way, I think that Chenier Energy was the better one to buy. But I think Target has the ability to rebuild its one slash dividend. And that's a good reason to stay long to stock. Target's for me. How about the S&P's biggest losers? Wow, they are powerful. Powerfully bad.

Starting with Walgreens down 64%. Here's a company that needs a buyer or buyers, maybe some for the front of the store, decimated by Amazon, some for the back, which could be used as a dispensary for all sorts of drugs. CEO Tim Wentworth, he's real good. He's closing money, losing stores, offering free one-hour delivery, has a series of incredible bargains on the homepage. Check it out. But the balance sheet's just not so hot. And to truly turn around, well, Walgreens needs other pharmacies to go under so it can raise prices.

Either that or it needs to break up different parts of the enterprise and sell them off. Down here, though, I would not bet against Wentworth. You can't. The stock's just too low.

Second, Moderna, with a stock down 58%, remains a casualty of the post-COVID hangover. One of the last. Now, the Zoom video and docusign have taken off. The numbers here are staggering, staggeringly bad. The market capitalization in 2021 got as high as $195 billion. Now it is $16 billion. The house of pain. It's decline in revenues from $19.3 billion in 2022 to an expected $3.3 billion last year is eye-popping and nauseating. And we keep waiting for the promised personal vaccines. Eye

I like CEO Stefan Benzel. Nice man. But I'm sad to say that the stock would roar if he were to step down as manager, even if he definitely needs to stay on to help back vaccines. He's a great guy, but shareholders deserve better performance. Third is Celanese CE. It's a Federal Reserve stock, meaning it's a company that makes plastics, one that got its clock clean, down 55 percent. Revenues flattened, profits fell.

Typical of all the material stocks I follow, though, this one, like so many other industrials, needed China to recover, and it didn't. It also needs aggressive rate cuts. Until we get both, please don't bet on this one bouncing back. We own several stocks in the Chapel Trust that need China to come back, and all I can say is I hate those stocks. Sell, sell, sell. Well, at least until they annualize their crummy Chinese numbers, and then they'll probably bounce back.

Fourth is Estee Lauder lost 49 percent last year because it went all in China and saw every part of its business pretty much fall apart, even as management kept promising otherwise. Yep, louder, overpromised and underdelivered endlessly. And as that real denouement feeling, as it was also viscerated by competition from ELF Beauty or ELF.

Of course, management would never admit this. It would never admit that its products are way overpriced compared to Elf's, much cheaper, but only slightly inferior to merchandise. They would say it's radically inferior. My wife couldn't tell the difference. I put them in front of her. She didn't know. I mean, I've told her that story already. Now, we got gapped by this one for the travel trust. Believe me, the CEO, we were wrong. We regret the error. Finally, there's Enphase, which is a solar equipment company that's the misfortune of making some of its equipment in China. Woo!

Given that Trump won over Solar African Vice President Harris, we can expect that much higher tariffs are looming on Chinese goods. I think it's amazing that Enphase was only down 48 percent for the year. But hey, there's always 2025. We have some possible winners among the ones that I mentioned, including United Airlines and Brocon. But for the most part, the potentially big winners, the S&P 500, are the same as the winners we just covered, the Nasdaq, Palantir, NVIDIA and Axon.

The losers? Here's the bottom line. We need to see the big plan for Walgreens, a change to top of Moderna, China returning to industrial growth for selling these, a change in management and return to growth in China for Estee Lauder, as well as more realistic pricing. And I don't even know what to do for Enphase. Sadly, I don't think they know what to do either. How about Robert in Texas, please, Robert? Hi. Hi. I value your opinion. Thank you. And I've held Apple for so long, and it's split so many times.

And now it's like over 30 percent of my portfolio. And I feel like I should diversify. You have to. That's too much. It doesn't matter. You know, look, discipline trumps conviction. So you will sell some Apple tomorrow. I cannot have you have 30 percent Apple, even though it is one of my favorite stocks. That does not make sense to me. Please, please, please take some off the table. Let's go to Jonathan, my homestead of Pennsylvania, where I was just last week. Jonathan.

Happy Booyah Year, Jim. Oh, totally. Where's your accent? You sound like me. Yeah, Bucks County, right down the road. Really? That's where I was. Wasn't it great? It was wonderful. Thank you.

hope you had some uh nice time with family and friends here i sure did thank you thank you good for you uh jim i haven't thanked you and your staff for quite a while for all the hard work you do and how much you help all of us you have made thanks a lot thank you yeah thank you you're welcome thank you for all the folks there i'm looking at a little bit of a defensive play

Just wondering if you think this stock's expensive. The P.E. seems a little high to me on Colgate's Paul Mullis. Well, I was listening. I watch Frank Holland's show every morning, and he had a guest this morning talk possibly about Colgate. I was listening. I felt quite compelled. I said, you know what? That stock has come down from 109 to 90. I think you should put some on. I want to thank you for those kind words. And, yes, I do love Bucks County. I grew up in Montgomery County. I always wanted to see if I could ever move up in life. I'd do it.

And I finally got there, but it took me an awful long time. Anyway, in 2024, there's a lot of overlap in the winners between the NASDAQ 100 and the S&P. As we head into this year, we'll have to watch and see if the potential winners will, do they have what it takes to keep winning? Much more mad money, including my look at some high yielders that could be prime players to watch in the new year. Plus, I'm revealing two themes that I think could drive the 2025 action on Wall Street and telling you what stocks could benefit from these trends. And of course,

Or your calls. Not a fire. Tonight's edition of the 2025 Lightning Round. So stay with Kramer.

As we kick off the new year, it feels like we're headed into a period full of uncertainty. A few months ago, we thought the Federal Reserve would be blessing us with a series of fairly aggressive rate cuts, but inflation refused to be tamed, and now the Fed's a lot less dovish. The bond market's been moving in the wrong way since September. We already had a huge Trump rally in the wake of the election, but we don't really know what the second Trump administration will prioritize in terms of economic policy. If it's tax cuts and deregulation, the market will lap it up. If it's tariffs, well, that's another story.

So what works in times of uncertainty? Well, I'll tell you what works. Dividend stocks. These are the ultimate sources of safety. And look, and it doesn't hurt that the high yielders have fallen out of favor as bond yields have soared, making dividend stocks less attractive ever.

in comparison. If you think there's a ceiling on bond yields, though, then this could be a great time to buy some high yielders. When you look at every member of the S&P 500, get this, 128 of them pay dividends that yield 3% or more. 32 yield more than 4.5%. While we were out for the holidays, we embraced our time off by pouring through those 32 stocks. We came up with

five high yielders that should work in 2025. First up, Realty Income. That's a real estate investment trust. They've been on the show, primarily focused on retail properties with some growth opportunities in the data centers and gaming markets. Realty Income, that's symbol letter O, has the second highest yield among the real estate investment trusts, the S&P 500, at 6%. And it's the only one that pays a monthly dividend, which is fantastic, comes in very handy. Plus,

Plus, the company regularly raises its payout. They raised it five times last year. Now, realty income is down 19% from its late October highs here. I think that's mainly because the bond market's gotten more competitive, although Wall Street's also feeling more skittish towards some of their biggest tenants, like the dollar stores. A lot of people think Walmart's eviscerating those. Pharmacy chains? Well, that's Amazon, right? However, when Sweet Roy came on the show in November, he explained that his companies managed to grow earnings faster in the market during periods of both high interest rates and low ones.

It's very convincing. Plus, even though some tenants are struggling, he pointed out that the company hasn't seen any major lease renewal issues. And even if they do, they've got so many prospective tenants that it really wouldn't matter. I say take the 6% payout from real income and wait for the market to work through its concerns about the stock. Next, here's an interesting one. UPS.

I know UPS has been a serial underperformer for a couple of years now. And by any fair comparison, FedEx is the better operator. But if you're looking for income, FedEx has only a 2% yield. UPS currently yields north of 5%. Back in October, UPS reported a surprisingly strong quarter. And now that it's gotten past tough comparisons from a generous third quarter 2023 contract with the Tempsters Union,

Well, you know what? The company's beginning to get its costs under control, although that Teamsters contract was really bad for them. I thought so. But after popping more than 5% response that quarter, the stocks had nothing but tumble right back down again. Look at that. As I explained not too long ago, United Parcel's primary issue right now is trust. Early last year, the company put forward some three-year financial targets that Wall Street simply does not believe. But if management can deliver a couple more quarters like the last one,

The trust could be restored and the stock could have a nice run. Now, if management can't do it, then the board could change management and the stock will go higher, too. In the meantime, they're paying it away with that juicy dividend. I like the risk reward there. What else? A number of utilities made the high yielders list. Let's talk about Dominion Energy. That caught my eye.

This company that has regulated gas and electric utility business of Virginia and the Carolinas, large clean power generation business, including nuclear power plant. After Dominion became too unwieldy with ambitious but distracting clean energy projects, the company has now divested some big assets. It's become a much more focused operator, and I like what it's focused on. See, Dominion's service area includes Northern Virginia, which has one of the highest concentrations of data centers on the planet. We know data centers have this insatiable demand for electricity. Plus, Dominion's nearly 5% dividend yield still doesn't hurt.

A couple of regional banks made this short list of high yielders in the S&P 500. I feel particularly comfortable with Key Corp. That's a Cleveland-based parent of Key Bank. I don't know if you remember, we had CEO Chris Gorman on just a few weeks ago. I liked it. By the way, I like many regional banks. And I've got to tell you, Key has been languishing for the better part of two years after that mini banking crisis in the spring of 2023 because the company did make some missteps with its bond portfolio.

You know what? I think the infusion could allow Key to make some acquisitions. Remember, the FTC now more favorably inclined.

Lately, the stock's been falling again as long-term interest rates have risen, causing investors to sell the regional banks indiscriminately. I think you should use that market-wide fear to buy some Key Corp. As it's already dealt with this bond portfolio, while you wait for the market to figure out that the stock's being unfairly punished for the legacy issue, you can collect 4.8% yield. Finally, let's throw in a solid energy name. I'm talking about Chevron, which barely snuck onto our list of finalists with a 4.5% yield as of the end of last year.

This stock's basically been flat for two and a half years now, more or less, at least since inflation peaked in mid-2022. That's happened amid declining or stagnant energy prices and some company-specific issues like a major deal to acquire Hess, which has languished for a few reasons, including a dispute with Exxon over certain international projects.

Well, I think it's going to be hard to keep Chevron stock down for much longer. At the end of the day, I'm less sanguine than most about the oil industry under Trump because of drill baby drill policy. And that means more supply and more supply translates, of course, to lower prices. However, there will obviously be some benefits for the integrated oils from the new regime in Washington. It's infinitely more fossil fuel friendly than the outgoing Biden White House.

Chevron currently sells for less than 13 times this year's earnings estimates, offering good value in a market that looks increasingly stretched in places. And that nearly 4.5% yield, I don't know, that seals the deal for me. Here's the bottom line. Realty income, UPS, Dominion Energy, K-Corp, and Chevron. Five.

dividend stocks you might want to put on your shopping list at the outset of a new year that's filled with uncertainty. If you're looking out at 2025 without a clear idea of where to put new money now, well, I got to tell you, those five stocks may be a great starting place for your capital. Mad Money is back. Coming up, Kramer takes your calls and the sky's the limit. It's a fast fire lightning round. Next.

It is time. It's time for the Light Round. And then the Lighting Round is over. Are you ready? Let's go over to Frank in Texas. Frank! Jim, a hearty booyah to you from San Antonio, Texas. Fantastic. Go Birds! Let's go!

Jim, I have a position in Uber, and I'm down just a little bit. What do you think? Should I add? Should I hold? I want you to buy more Uber. I know it was up two bucks today, but I think it's really down way too much. I'm going to go to Preston, Illinois. Preston. Best in the house. Happy New Year. Happy New Year. Uberable AES. What is that, 5% yield? It's down way too low. I think it's time to pick up that utility. Let's go to Robert in New York. Robert.

Chil says happy new year to you. How can I help? What's this, Doc? Penn Entertainment? No, I don't like Penn Entertainment. They, you know, a new broom needs to sweep clean there, let me tell you. Let's go to Trey. Trey McBride, perhaps, in Texas. Trey!

Jim, watching you and President Trump at the exchange a few weeks ago was truly inspirational. Oh, thank you, Trey. Trey always has nice things to say. I really appreciate it. Thank you. I tried to play it straight down the middle. That's all you can do. That's all I've ever done my whole life is straight down the middle. That really is me. What's up? I mean, the single most influential and brilliant person on Earth standing next to the president-elect. Wow, what a time.

So believe it or not, I actually stumbled onto this stock ticker while trying to purchase a recliner online. But after some research, I think Lazard shareholders are sitting prettier than owners of Lazy Boys going into 2025. Can I get a hallelujah? Yeah, hallelujah. Absolutely. I've got to tell you, I think Lazard's really inexpensive. We're going to get all this M&A stuff. I think you're absolutely right. And I'm going to give you an anytime touchdown. Let's go to, I love that. Let's go to Curt and George and Curt.

Oh, sure.

I'm calling about a stock. Everybody said it was going to be a $1,000 stock. Great numbers, great products. It's a really well-run company as far as I can tell. I started buying it just over $900 and kept buying as it went down and down and down. It really hit my portfolio last year. Do I sell it or should I hang on to Eli Lilly? Okay, the problem with Eli Lilly is people are saying, you know what, after a year, people are no longer taking the drugs. They're going off it. A huge percentage is going off it.

I think that you own this thing because it's about cardiac incidences. It's about high blood pressure. It's about dementia. It may even be about cancer, not just about weight and diabetes. So I think you hold on to Eli Lilly. We continue to hold it for the trust. I do think there'll be good numbers, but that last quarter wasn't good. I totally understand the trepidation about the stock, but I still like it. How about Nick in Florida? Nick.

Jim, big booyah from Florida and a happy new year to you, man. Aw, thank you. Same to you. Shout out to my mom, Mara, and my girlfriend, Diana. Jim, this stock is down 26% in the past six months and has been a staple in my portfolio for a few years now.

My question to you is buy, sell, or hold? Ticker symbol N-U-E. Nucor. Nucor. I thought Nucor was bottoming. It's been very, very tough doing this great steel maker. I really got to see what the material stocks are all weaker. And there's a lot of dumping of steel from China yet. All they do is hack and dump and hack and dump and they get away with it. So that's what's hurting the stock. Let's go to Alan in Florida, please. Alan.

Yeah, Jim, thanks for taking my call. A number of months ago, if I remember correctly, you interviewed the chief executive officer of Laboratory Corporation of America. And I own a lot of that stock. And it seems to me that that stock's been dead money. And I wonder what your thoughts were about it now.

You know, LabCorp did have a spike over COVID, and that was about when I interviewed the CEO. I think the stock at 15 times earnings is fine, but the problem is it's health care, and people do not like the health care stocks. What can I say? And that, ladies and gentlemen, the conclusion of the Lightning Round. The Lightning Round is sponsored by Charles Schwab.

Coming up, has the optimism around the market reached a fever pitch? Kramer's digging into the areas where he's seeing too much speculation. Next.

The beginning of the year is always filled with optimism. I like that. Far too often, the analysts gin up a sense of doom based on rates or valuations or whatever seems to be the dark flavor of the day. But sometimes, I got to tell you, there's too much optimism in certain sectors. We've seen this movie before. Faster battery chargers that didn't pan out. New electric vehicles that failed or are failing. Even vaccines for cancer that never materialized.

This year, I see two themes I want to caution people about, nuclear power and quantum computing, both a promise someday. But that day is not just not near enough to justify the current valuations for these stocks. Right now, there are two utilities that generate a lot of nuclear power, Vistra and Constellation Energy, the latter of which just got a big contract with the feds, $1 billion.

to expand nuclear site. The big utilities are frantically trying to meet power demand generated by the data center revolution. I think these two stocks are now way ahead of themselves. They trade like they'll be able to build many nuclear reactors next to the currently approved ones because siting won't be difficult. Oh, that's true. But building them will be. It takes ages to construct one of these things. Big overruns. Constellation is reopening a decommissioned three mile on plant with Microsoft signing a contract for 20 years worth of power. That does sound great. But I

I think the process of restarting a dead nuclear power plant won't be easy. But hey, at least Constellation and Vistra are real, even if their stocks have gotten overextended. When it comes to nuclear power overenthusiasm, we've seen some of these smaller companies that offer alternatives to the current plants. They worry me. Companies like Oklo with nuclear fission capabilities, new scale power.

with small form factor technology. They're exciting, but they're also years from developing anything meaningful. Or as my friend Michael Sembliss, chair of the Market and Investment Strategy Group at J.P. Morgan wrote in his unbelievably pressing 2025 outlook, what nuclear renaissance? Wake me when we get there.

I don't want to go into specifics of too many of these companies that are devoid of any revenue. I will say that the most important builder of nuclear plants in this country, GE Vernova, is about as bearish as the promoters on bullish. I've tried to coach CEO Scott Strasek to be more positive on the prospects, but he won't.

After all the engineering hurdles, cost overruns and balance sheet damage associated with these plants, he doesn't expect anything commercially viable for about a decade. So I don't think you want to be in any of these nuclear stocks for too long. How about quantum computing? Look, quantum computing is not a hoax. It's kind of a low bar. Alphabet is a facility dedicated to quantum computing. This is super fast computing using superconductors that require a specialized computer environment based in part on cryogenic technology.

Sounds promising. The others burn too hot, right? The regular data centers. But it's not a reason to buy Alphabet because there's nothing that's ready at scale. I like Alphabet, owner for the Travel Trust, but that's because we like their dominance in search, progress in YouTube, and incredible strength of Google Cloud services, well ahead of what people think. Quantum computing is just a long-term project.

But then, for example, when I look at Rigetti Computing, it's a $5.6 billion company, professes to be a leader in quantum computers and superconducting equipment. I grow concerned. Rigetti is a multiple-year money loser with just $11.9 million in revenues in the last 12 months. This stock was at $0.66 four months ago. Now it's at $20 a month.

up over 30% just today. Its big break occurred at the end of November when it sold 50 million shares at two bucks. The stock was off the races ever since then. Hey, it's a quantum GameStop, okay? I am wary of D-Wave Quantum, a $2.2 billion company with 9 million in revenues over the last 12 months and very big losses. I'm also concerned about a company called Quantum Computing, $2.4 billion with 400,000 in revenues in the last 12 months and again, very big losses.

Look, I believe in nuclear power. But when GE, Renova, the company that arguably has the most to gain from it, says discouraging things about an uptick in commercial nuclear power coming anytime soon, when quantum computing seems very much in infancy, well, I fear people will get hurt speculating on even the biggest companies, let alone the smaller ones. You can speculate.

that, of course. But please understand that, like at all New Years, the animal spirits are in play for a few stocks, and I don't want you to be trampled by wayward bulls with visions of riches in front of their greedy eyes. You own Rigetti? You just won! Take some gains, and then go out and buy yourself a nice cashmere sweater. I like to say there's always one market somewhere. Promise to find it just for you, right here on Mad Money in 2025. I'm Jim Kramer. See you tomorrow! See you tomorrow!

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