Lithium stocks like FMC Corp. are under pressure, but for CNBC’s Jim Cramer, the agricultural chemical play is flashing screaming buy signals.
“I’m glad FMC’s getting hit here because you’re getting a chance to buy a red-hot stock into weakness, just in case you missed the incredible buying opportunity in March,” when the stock was at a low after a 26 percent drop since January, the “Mad Money” host said.
With shares of FMC still down roughly 10 percent from their January highs, Cramer argued that they’re not yet factoring in the company’s better-than-anticipated first-quarter earnings results.
“It’s one of the least expensive stocks in both the agriculture space, which is very popular, and the lithium space – OK, that’s cooled a bit – but selling for just 13 times next year’s earnings estimates,” Cramer said. “That’s, frankly, lunacy. I mean, it’s got a 15 percent long-term growth rate. If you can buy it for 13.1 times earnings with a 15 percent growth rate, that’s called a steal.”
All day on Thursday, Cramer heard market-watchers buzz about the stock of Netflix surpassing the stock of the Walt Disney Company in market capitalization.
Netflix, the online streaming giant behind popular titles such as Stranger Things with the best-performing stock in the S&P 500 so far this year, reached a market value of $152.6 billion on Thursday, according to FactSet.
Shares of Disney, the ubiquitous entertainment company with successful franchises like Star Wars and Marvel’s Avengers, fell about 1 percent, pushing Disney’s market value to $151.8 billion.
But to Cramer, comparing the two entertainment plays was not particularly useful.
“To me, this comparison is as fatuous as one drawn by a reporter who famously asked Babe Ruth back in 1930, how it is possible that he made $80,000 a year when President Herbert Hoover was paid just $75,000?” Cramer said.
“His response: ‘What’s Hoover got to do with it? Besides, I had a better year than he did,'” Cramer said of the baseball legend.
As consumers grow increasingly health-conscious and chemical-averse, companies like Indigo Agriculture are working to weed out old, synthetic agricultural solutions like GMOs, Indigo CEO David Perry told CNBC on Thursday.
“Modern agriculture’s really built on technologies that were created decades ago: synthetic fertilizer, synthetic chemicals, GMOs and plant breeding. We’re taking an entirely new approach,” Perry told Cramer in an exclusive interview.
“I think this is an opportunity to see a revolution in agriculture using naturally discovered microbes to improve yields of plants and also to protect them against pests and insects so we can reduce the amount of fertilizer used and the amount of agricultural chemicals used,” Perry said Thursday.
For more on why Perry’s company is a CNBC Disruptor for 2018 and how it’s changing the farming space, click here.
Cramer could not hold back as he watch the 10-year U.S. Treasury yield sink lower on Thursday and hover around 2.9 percent.
Investors worried for weeks about the yield on the 10-year rising above 3 percent and destroying the stock market’s gains, so the “Mad Money” host was surprised that more market-watchers weren’t coming out and saying that now that it’s declining, stocks could run higher.
“Why are rates falling? Yesterday we got Fed minutes from the May meeting and the esteemed body agreed that inflation may be transitory and not embedded,” Cramer said. “If inflation is temporary, people, there’s much less need for the Fed to tighten aggressively.”
Cramer had five reasons for why the Fed’s call that inflation wouldn’t run above 2 percent for long seemed sound.
For Intuit Chairman and CEO Brad Smith and his company, the parent of TurboTax, Mint and other financial planning aids, the ability to evolve with the times is key to success.
That’s why Intuit rolled out TurboTax Live in the face of the Trump administration’s new, reportedly simplified tax code, which will offer a “postcard-style” system for filing taxes, according to members of Congress.
“The reality is, in the U.S., about 155 million people file taxes. Ninety million of them go to a tax store or a CPA, and with tax simplification, more of them are now going to have confidence that maybe they can file their taxes on their own at a much lower cost,” Smith said.
“And now that we introduced TurboTax Live, they don’t have to be worried about being alone. They can touch a screen, have a CPA come right into the software and help them through the tax return,” the CEO continued. “So we think this is going to be a huge catalyst for the category and for our company.”
To watch Smith’s full interview, which covers his company’s most recent earnings report and future prospects, click here.
In Cramer’s lightning round, he shared his rapid-fire take on callers’ favorite stocks:
GTT Communications: “Nothing [is going on with GTT]. It’s doing very well. I mean, honestly, I think it’s doing incredibly well. I’m sorry that it went down so much after [CEO Rick Calder] was on, but they’ve got that low-infrastructure telecommunications model that’s terrific. That’s probably one of those stocks that’s just going down for incorrect reasons. I’m not kidding. I like that business very much.”
Caesar’s Entertainment: “I was surprised to see that J.P. Morgan recommended that stock and they’ve got the best analysts in the group. I’ve always felt the balance sheet was bad, but maybe they’ve got some optionality. You know what? I like MGM. MGM’s been stalled lately. At Caesar’s, I can’t pull the trigger because of that balance sheet, but I guess there’s some mojo there.”
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Source: Tech CNBC
Cramer Remix: Don’t let this buying opportunity pass again