With all of the investors fretting about the trade war with China and the Federal Reserve’s plans for interest rates, what CNBC’s Jim Cramer is really worried about here is jeans.
“Yep, I think the biggest threat to this bull market is denim,” he said Wednesday on “Mad Money” as stocks rose on hopes of a U.S.-China trade deal. “I, right now, at this very moment, am more worried about jeans than I am about China.”
Cramer was referring — somewhat jokingly — to Wednesday’s news that denim company Levi Strauss filed the paperwork for an initial public offering. While he admitted that “it’s an exciting deal,” he said it will likely cause investors to sell shares of market stalwarts like PVH and Ralph Lauren so they can get in on the IPO.
“Now, maybe you think I’m being small-minded here — it’s just jeans, right? Wrong. See, it’s not just jeans,” he said. “We’re about to get a tsunami of new initial public offerings that will flood this stock market with new supply, and there simply isn’t enough money coming into the stock market to be able to handle all of this merchandise.”
While he acknowledged that most of the upcoming deals are from companies that have great track records, Cramer worried that the market simply won’t be able to sustain the IPO tidal wave.
“We are about to get hit with a perfect storm of IPOs, and regardless of how good this new merchandise might be, I’m concerned that the market won’t be able to handle it all without taking, maybe, all stocks lower,” he said.
Click here for his full analysis — and the IPOs you should have on your radar.
Manufacturer Cummins has been hit with competing analyst ratings after its most recent earnings report, so Cramer thought it was worth weighing in on the battle.
“I love it when we get these dueling pieces of research, because you always want to know the best arguments of both the bulls and the bears,” he said Wednesday. “Hopefully, by pitting them against each other, we’ll end up with a smarter synthesis that helps us figure out where Cummins’ stock might really be headed.”
Cummins, a truck-engine maker that is widely seen as being hostage to China, has become something of a proxy for the welfare of the global economy and “the intensity of the trade war with China,” Cramer explained.
As such, it’s worth knowing what Wall Street professionals think is in the cards, especially considering the Federal Reserve’s newfound patience on interest rate hikes, which put pressure on the trucking industry late last year, he said.
Click here for Cramer’s full take.
Investors can now boost their capital and support small businesses in one fell swoop by following a new, growing theme in retail: using technology to empower small businesses, Cramer said Wednesday.
The idea struck Cramer when he interviewed Shopify Chief Operating Officer Harley Finkelstein on Tuesday. Not only does the company help celebrities like Drake and Kylie Jenner sell their products online, the COO explained, but it also makes it easy for individuals without millions of social media followers to set up their own e-commerce operations.
“Shopify isn’t just a software company that enables e-commerce, it’s become the way for anyone to sell their own merchandise online,” Cramer said. “For every Kylie Jenner who builds a billion-dollar brand powered by Shopify and clever social media campaigns, I think there are thousands of people who are working to fulfill their own dreams — dreams that never would’ve gotten anywhere before Shopify launched its platform.”
And Shopify isn’t the only company seizing on this trend.
Click here to read more about Cramer’s new thesis.
International Flavors and Fragrances is leveraging its $7.1 billion acquisition of Frutarom to get more into natural ingredients, IFF Chairman and CEO Andreas Fibig told Cramer on the heels of his company’s latest earnings report.
“Seventy-five percent of all their offerings are natural products,” Fibig said of Frutarom, adding that its customer base of “faster-growing, smaller companies” is an added benefit to the old-line IFF.
“We have, now, in our industry, the largest and broadest customer base with 30,000 customers,” the CEO said. “Now, we are bringing some other adjacent areas like natural food protection, natural colors, our health products, in as well with all-natural ingredients. And we believe that this can help us to accelerate our growth, actually, to 5 to 7 percent.”
The company is also planning to seize on rising demand for plant-based and alternative, non-meat protein, Fibig said Wednesday.
Click here to watch his full interview.
The latest edition of Tableau Software’s data visualization platform will be “a dramatic step forward” in simplifying big data, Tableau President and CEO Adam Selipsky said in a “Mad Money” interview Wednesday.
With the addition of new data preparation tools, new mobile software, an integration with PowerPoint and a powerful new natural language processing capability in AskData, Tableau is moving closer to its mission of lowering the “barriers to using data,” the CEO told Cramer.
“[AskData] basically lets you ask completely natural questions in human language, like, ‘How were my sales last week?’ and Tableau gives you back a complete Tableau visualization of the answer. It’s got really smart algorithms inside of it which translate things like bookings or sales and revenue all into the same concept,” he said. “We think it’s really going to be a dramatic step forward in terms of making it easier for people to work with data. We think it’s the type of technology that, over time, can enable millions or even tens of millions of people to work with data without being data scientists.”
Click here to watch Selipsky’s full interview.
In Cramer’s lightning round, he rattled off his responses to callers’ stock questions:
Fitbit Inc.: “I would’ve liked Fitbit at one time like I would’ve liked Fossil. I know, obviously, Fitbit is better in terms of health, but the Apple Watch is king. And while Fitbit can sneak back, you know: own Apple, don’t trade it.”
Moderna Inc.: “I pulled up with these guys when I was at the J.P. Morgan Healthcare Conference and I was quite impressed. I think it is a winner. Now, a little speculative, but you’ve got a good call.”
Disclosure: Cramer’s charitable trust owns shares of Apple.
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