The athletic apparel retailer’s previous quarter did not serve it so well, but the “Mad Money” host learned several things from this quarter including the fact that while business really is strong, Lululemon’s stock behaves frantically, almost separate from the fundamentals.
“The stock behaves like the company’s just a fad — something along the lines of the fidget spinners, the faddish toy that drove a lot of Five Below’s numbers last night,” Cramer said. “But LULU’s business itself isn’t a fad, and while it’s not immune to fashion mistakes or competition, it’s not going to make that many fashion errors and the competition seems to have fallen behind again.”
Despite the Labor Department’s Friday jobs report missing estimates, the market still went higher, telling Jim Cramer that Wall Street is really only interested in one key factor.
“It’s the same story that we’ve seen all year, the same one I’ve been coming with the same one I’ve been telling you: it’s about profits,” the “Mad Money” host said. “Yep, corporate earnings have been so positive in 2017 that investors are reluctant to sell because from an asset class perspective, stocks are pretty much the only decent game in town, unless you think that 10-year Treasurys yielding 2 percent are a good place to put some money.”
With the market’s unfaltering attitude in mind, here are the stocks and events Cramer will be watching next week: On Monday, Cramer’s watching Thor Industries, the world’s largest recreational vehicle manufacturer in the country and a stock on which Cramer has been very right and very wrong.
“I’m tempted to believe that Thor has course corrected, but you know what? Here on ‘Mad Money,’ it’s kind of like the NHL. We put companies in the penalty box … so I’m adopting a wait-and-see approach for Thor,” Cramer said of the company’s Monday earnings report.
Tuesday brings an earnings report from Dave & Buster’s, and Cramer expects terrific earnings from the restaurant and entertainment center company when it reports after the bell. The “Mad Money” host expects Dave & Buster’s to announce expansion plans as well.
In most cases, Cramer would not focus on earnings from the wine and spirits giant behind Jack Daniels whiskey, but chatter of Constellation Brands eyeing Brown-Forman as a takeover target caught his eye.
“I think that would be very out of character for Constellation,” he said. “Still, it will be a closely listened to [Wednesday’s] conference call because of that rumor.”
On Thursday, ski resort operator Vail Resorts will report earnings before the bell, and Cramer blessed it as a trade.
“This has been a terrific story for some time,” he said. “Vacations have become Facebook rites of passage and Vail’s been benefiting from this trend for ages.”
Cramer says a selloff is possible on Friday ahead of Fed meetings on Tuesday and Wednesday of the following week if the market gets worked up over this Friday’s lagging jobs report.
“Remember, most investors and all holders of bank stocks, for heaven’s sake, which have been horrendous, want to see the Fed raise rates as a sign of economic health. We’re in the odd position of worrying that the Fed might not tighten after this weaker [labor] report that we got this morning. If they do nothing, there will be selling, so why not get out ahead?” Cramer said.
Cramer also sat down with Exact Sciences Chairman, President and CEO Kevin Conroy, who said his company’s blockbuster colon cancer test, Cologuard, is paving the way to the development of new cancer detectors.
“The same technology that powers Cologuard, this advanced technology that finds cancer DNA in a stool sample, we’re now showing proof of concept of detecting lung cancer from a simple blood draw, liver cancer from a simple blood draw,” Conroy told Cramer on Friday.
And while he admitted his industry is competitive, Conroy was confident about the future of his company’s technology.
“It is a competitive environment, but there are two aspects of this environment. There are some people who are developing tests to help guide the right cancer treatment. We’re all about early detection, and our technology is less expensive than some of those other technologies that guide treatment, enabling us, we believe, over the long run, and I want to stress this, over the long run, to be able to offer tests that detect cancer early,” the CEO said.
While Dow Chemical Chairman and CEO Andrew Liveris was disappointed at President Donald Trump’s decision to withdraw the United States from the Paris Agreement, he was not discouraged about the era of renewable energy.
“Look at our renewable energy already, with how many jobs it has. The solar, wind and bios. We’re going to keep supporting that. This is advantage America,” the CEO told Cramer on Friday.
Liveris, who also heads Trump’s manufacturing council, acknowledged the trade-offs inherent in moving the country towards using energy that produces less carbon, a key contributor to climate change.
“Can we keep all of our energy jobs? No. But can we manage the transition? Yes,” Liveris said. “I think this president, he just wants to manage the transition so coal miners don’t get hurt overtly. There is a base of people out there. Look, we’ve got to respect the fact that he’s the leader of the country. I believe that we’ve got to stay engaged to get the better answers.”
In Cramer’s lightning round, he ripped through his take on some caller favorite stocks, including:
Gilead Sciences: “Did you see when [Golden State Warriors basketball player] Kevin Durant ran right through everybody and did that lay-up? One of the players that he ran right through was Gilead. It just stood there and watched.”
Advanced Micro Devices: “I think AMD’s fine. I mean, I think that the quarter was good. They gave these projections, they weren’t as great as people thought. I think it’s a good situation.”
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