Stocks discussed on the in-depth session of Jim Cramer’s Mad Money TV Program, Thursday, August 9.
There are lot of ways to win in the stock market, and looking at stocks that were left for dead is one sure-shot way of winning. Thursday was one of those days where stocks that were ignored by the Street for long soared.
Viacom (NYSE:VIA) reported a great quarter after it saw a good turnaround, which was started in December 2016 by CEO Bob Bakish. Viacom, which owns film and television properties, including MTV, Nickelodeon, Comedy Central, BET, VH1 and Paramount Pictures, has been put through cost-cutting and has boosted its intellectual property wares. The company is also refurbishing the company’s balance sheet and driving sales with low-budget hits. “You know what’s the most amazing thing about this turn? So few people know that it’s happening – most people aren’t even aware that Viacom even owns this stuff,” said Cramer.
“After today, I wouldn’t be so sure CBS is the better business. However, I’d certainly rather own Viacom here than CBS. Everyone’s given up on Viacom, which means it’s got much more opportunity for upside than a stock everyone fawns over, like CBS,” added Cramer.
Century Link (NYSE:CTL) also surprised the Street with a good quarter, rising guidance, which led to the stock rallying 13%. The company had merged with Level 3 Communications, and its turnaround has been incredible.
Talking about turnarounds after being left for dead, how can Yelp (NYSE:YELP) be left behind? The company reported good earnings and beat on all counts, which led to the stock rallying 26%. It’s back in the spotlight. DowDuPont (NYSE:DWDP) also went up after its CEO, Ed Breen, purchased $2 million worth of stock.
Other stocks that were left for dead but are coming back into the spotlight are Michael Kors (NYSE:KORS), Spotify (NYSE:SPOT) and Roku (NASDAQ:ROKU).
CEO interview – Magna International (NYSE:MGA)
The stock of Magna International is down 5% for the year after the company missed in its recent quarter and cut guidance. Cramer interviewed CEO Don Walker to find out more about the quarter.
Walker said that the company had a record quarter in terms of revenue. Though it missed consensus, there were headwinds in the form of tariffs and the China joint venture. “If the tariffs stay the way they are – and who knows if anything more gets ratcheted up in China – it’s about a $60M a year hit,” he added.
There is no clarity on how much of the increased costs will be passed on to customers. “But I also think, at some point in time, NAFTA does get re-negotiated and the tariffs within NAFTA go away, because it’s bad for all three countries,” said Walker.
The company has entered into JVs with Lyft (LYFT) and Beijing Automotive Group, and it sees brighter times ahead. “I think the industry is the highest-tech industry in the world. We have lots of technology, we’re spending a lot in R&D, so I think there’s huge opportunities globally in the automotive industry,” he concluded.
World Wrestling Entertainment (NYSE:WWE)
The stock of WWE is up 250% since Cramer first recommended it in March 2017. “When you’ve got a triple, you need to take something off the table. That’s common sense. It’s portfolio management,” he said. Is it too late for investors to buy in? Cramer digs deeper to find out.
In the past few years, WWE has transformed itself from a traditional television and pay-per-view play to a direct-to-consumer colossus. Its digital properties are driving growth, and the company’s online streaming platform has made it the most followed sports brand in the world on social media.
Despite digital subscriber growth, the company has not overlooked its traditional TV roots. It extended its long-time deal with NBCUniversal subsidiary to air Monday Night Raw, and it agreed to air WWE Smackdown on Fox Sports (FOX, FOXA). “The really amazing thing with this story, though, is that WWE has both a thriving online subscription business, where people pay them directly for premium content, and they can negotiate better deals with their traditional TV partners,” added Cramer.
The company not only produces content for paid television, but also different content for YouTube and Facebook. “On the 2020 numbers, WWE’s trading at less than 25 times earnings, which seems a lot more reasonable, doesn’t it, when you’ve got a 37% long-term growth rate? WWE has caught fire here, so if you already own it from when I first recommended it, book partial profits,” Cramer concluded.
For those who do not own the stock, wait for a pullback before buying some.
CEO interview – CyberArk Software (NASDAQ:CYBR)
CyberArk reported good earnings and the stock rallied. Cramer interviewed chairman and CEO Udi Mokady to find out what lies ahead.
Mokady said the company had a good quarter in all three geographies. The new regulations in EU gave it momentum, government spending on cybersecurity in the US has increased and companies are taking cybersecurity seriously to protect their sensitive assets.
Mokady adds that cybersecurity is getting important which each day as threats from North Korea and Iran still loom. With the upcoming elections, the interference remains a top focus.
Viewer calls taken by Cramer
Mylan (NASDAQ:MYL): Cramer doesn’t like the company because it doesn’t have good margins and it did not have a good quarter either.
Boot Barn Holdings (NASDAQ:BOOT): The sales momentum and rising same-store sales are impressive.
AMC Entertainment Holdings (NYSE:AMC): Cramer did not opine on the stock, as the viewer knew more about it than he did. He said he needs to work more on the stock.
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