Mad Money 07/16/26 | Audio Only

My mission is simple: to make you money. I'm here to level the playing field for all investors. There's always a bull market somewhere, and I promise to help you find it. [music] Mad Money starts now.

Hey, I'm Cramer. Welcome to Mad Money. Welcome to Cramerica. Other people make friends; I'm just trying to make a little bit of money. Now, my job is not just to entertain, but to do some educating about a crazy market. So, call me at 1-800-743-CNBC or tweet me Jim Cramer.

It takes a lot of hubris, a lot of guts to disagree with the market's judgment about a stock after reports. You're basically saying that the collective wisdom of millions of people and billions of dollars is just plain wrong.

Yeah, [music] at times I think the sentences pronounced against stocks are so really wrong that you got to call them out right here. You have to appeal, so to speak. Otherwise, you're going to miss some incredible buying opportunities. My job is to show you that.

So, today when the Dow fell 106 points, as it declined 0.51% and the Nasdaq lost 1.47%, I want to go over some of the dumbest judgments that have ever been rendered so far this earnings season, at least in my opinion. And [snorts] none of them, thank heavens, are part of the hellacious tech unwind that everyone else is possessed by.

The first is GE Aerospace, run by the tremendous Larry Culp, with a stock that fell roughly 4% today. The market's dead wrong here.

First, the aerospace boom which started post-COVID is still in full swing. There's been no serious diminution of travel. The market's always looking for a pure play on a long-term secular trend like aerospace. Boeing's too risky, even as I like it for a long-term comeback, and I'm positioning it for the travel trust. People are too afraid to buy Honeywell Aerospace, which has just spun off from Honeywell Technologies. We own that one, too, because it's considered a fixer-upper.

Boeing and Honeywell Aerospace are works in progress in one of the great secular growth stories, aerospace. But GE Aerospace remains the best institutional choice right now. You never sell the stock of GE, by the way, before Farnborough. That's the big British International Air Show that takes place next week. There's a good chance GE will win its fair share of business over there. You got to buy it before that. Plus, this company has raised its full-year numbers gigantically based on strong orders and improved execution.

Its cash flow was the strongest in years. Planes are lasting longer and GE makes a huge amount of money servicing the planes, which, by the way, is the highest-margin business. They're going to return a ton of capital to shareholders, and yet the stock got slammed. I think GE Aerospace is so important that I'm actually going to go over it in detail if you stick around.

Next, another one you may bank there, Wells Fargo. Look, we had five major banks reporting on Tuesday. My oh my, head was on a swivel, for heaven's sake. I mean, jeez. I tried to pay attention to each one. Sure, JP Morgan was terrific. Everyone knows Goldman Sachs. Wells Fargo, however, was savaged with a powerful analyst who actually cut his price target. Most of the community, the community, got to love that, dismissed this company and its quarter.

But I would contend that Wells Fargo's quarter wasn't just good. I thought it was terrific.

The analysts are fixated on the sequential net interest income and also they care about net interest margin. They want banks to make more money on the difference between what they pay you for your deposits and what they charge you for loans. That is all they seem to care about. And sometimes it's just so myopic. When I was listening to the Wells Fargo conference call, I had to hear analysts one after another condescendingly ask CEO Charlie Scharf, who knows a heck of a lot more about banking than they do, why he isn't making more off the deposits and his loans. Oh, but Charlie, how about the NIM? Oh, Charlie, how about the NII?

Meanwhile, Charlie is talking about turning Wells Fargo from a bloated, underachieving lender into a merchant bank of the first order that's helping companies come public and do mergers and acquisitions. Where the money is, by the way. It's a very difficult thing for a bank to change its stripes, transforming itself from a loser in these incredibly lucrative businesses to a winning investment bank. But when you look at how Goldman Sachs is killing it, you know that's what Charlie wants to emulate. And I think that's a great plan. He's rapidly moving up the tables.

Listen, Charlie Scharf is known as one brilliant banker. He saved Wells Fargo, as far as I'm concerned. And yet it got killed when it reported because of these naysaying analysts who don't understand that Wells is transforming itself into something much better. It sells at 12 times earnings, for heaven's sake. I told CNBC Investing Club members that today Wells Fargo was a steal.

Next, the best pharmaceutical company save Eli Lilly is Johnson & Johnson. It's got a top-tier oncology franchise. There are so many potential blockbusters here in the pipeline and it could withstand any loss of exclusivity. Its neurology franchise, out of nowhere, has become the most important in the whole industry with Spravato for depression, Caplyta for major depressive disorder. Lots of people thought those would never be major drugs. They were wrong. Icotide, a recently approved drug for moderate to severe plaque psoriasis, may actually become the biggest drug in J&J history. Its ophthalmology franchise, after years of suboptimal growth, is starting to get hot.

J&J's got a triple-A balance sheet, even better than the US government. It's spinning out its prosthetic orthopedics business, which will raise the price earnings multiple of the remaining company.

However, J&J had a heart business that made about $150 million less than expected, something I suspect will be corrected later this year. Now, let's put this in perspective. $150 million less than expected on what kind of basis? On a $100 billion basis. I say that's the trade. Focus on the forest of green, not the 150 mistake.

For all that, though, what happened? The stock got crushed, at one point falling eight bucks in yesterday's hideous performance. It did rebound a little bit today and it was half-heartedly supported. You usually do not get a chance to buy Johnson & Johnson $20 below its high. I would take it.

What else? Levi Strauss is starting to get its due now, but it didn't when it reported last week. I was pleasantly surprised when CEO Michelle Gass came on Mad Money and talked about the incredible strength of the women's division. This is a man's business. The direct-to-consumer business is growing like big yoga. The disaster, the bane of all apparel for everybody else. Not Levi's, nice upside surprise. Tremendous cost this one, terrific ad campaign. Every line item worked, not a single missed KPI. And what happens? Levi's gets crushed, falling over 2% last Thursday after its report. We have so many disappointing apparel companies, it's crazy to me that Levi Strauss's success got dinged, even if it was only temporary. Stock's now above where it was when the company reported, but it's way too cheap.

Finally, there's one that you're going to hear all about tomorrow, but nobody talked about today, UnitedHealth. Okay, sure, it opened up huge, up almost $40, but it spent the whole rest of the day giving that back and it closed up a measly five smackers. UnitedHealth had excellent margin improvement, much better pricing, great numbers from its formerly lagging Optum division. It is back to being the leader of the managed care group, in part because the great, the wonderful Steve Hemsley has returned as CEO.

I know this stock's up more than 28% this year, but it was in a real canyon for a long time and it is well below where it traded a couple of years ago. I can't believe this Dow stock gave up the ghost today. It was a fantastic quarter.

Look, I know we're all obsessed with tech. We'd rather hear about which fund blew up from the declines in SanDisk and NetApp and Seagate and Micron than those attractive buying opportunities that you go up gradually over time that I just mentioned. There are people who want to borrow hundreds of thousands of dollars to buy disk drive companies and CPU makers that will get blown up. They don't want to own genes or a plane or health insurance or National Bank or drug company stocks that you can buy and own for the long haul. They want to borrow money from brokers and buy the hottest stocks, and they will be eviscerated. They want to play with the big boys, the hedge funds. Some of them are getting blown up right in front of us, and others are shooting against those same funds.

Those funds got flayed. I think it's a much better game to find mismarked stocks that analysts don't really care for, but I can tell you right now I know better than they do. They're good. Look, as I said at our monthly CNBC Investing Club meeting, we like a lot of these tech component stocks, too, but they're in the grips of terrible shareholders who are now being taken out and shot by the margin assassins.

The bottom line, it's much better to take advantage of a mismarked J&J or Wells Fargo for the long term than to try to figure out exactly when the margin traders are going to get blown out enough that you can buy a disk drive company. After all, you never know when the poor souls who'd be margined out of that commodity chip maker will finish. That's not something you even need to ask yourself when it comes to these superb companies that I just mentioned. These you just buy and put away and be thankful that the market got them all wrong and gave you five tremendous buying opportunities.

David in Texas, David.

Okay, well, it could bounce a little. It may be back to where it was at a 4% yield, but you see all of the work that I do, and I mean I spend a lot of time on cloud, not that much, but all the work that we do on these particular kinds of programs that we're talking about in artificial intelligence, they duplicate a lot of what Accenture does, but for a much lower price. So, I'm going to have to say stay away, even though I know it's a good company. Boy, the times, they are a changing. Let's go to Srini in Texas. Srini!

Uh thank you. Thank you. How can I help you?

Thank you.

No, no, she's quite wrong, actually. I think that you've actually figured out the right time and I got to tell you, you and I are pretty much in the same boat. And I think that we both have a lot vested here. So, let's go to work.

Okay, so she gets that. Well, look, you and I together, we're going to kick butt. That's what we need to do. And tell your wife, by the way, that you know what, she's sensational, but she's saving some money doing it this way.

I think you need to have patience here. I think it's just down on a dip. It's really still the best way to play China. I know the GDP growth of China was disappointing, 4.4%, and by the way, I am a harder line on the Chinese than most people you see on the air, but you know what? I want to try to help people make money and I think you can make money [music] Alibaba. And tell your wife, you know what? She ought to watch it, too. Maybe she learns. No, check, everyone could benefit. How about that?

All right, now listen to me. If you want some long-term winners, look at something like a J&J or Wells Fargo. The world is not made up of Seagate and Western Digital. [music] Now, at least until investors stop flitting in and out of chip makers, that may be the best way to go. I mean, I might be right. Like I said earlier, I can't understand the reaction to GE Aerospace's latest quarter. I'm digging deeper into the numbers of what I think is one of the greatest companies ever.

[music] Then, what did J.B. Hunt's latest earnings tell us about the transports? I'm running through the report and taking a closer look [music] at the sector. It's a key economic indicator and a transport can make you a heck of a lot more money than you realize.

[music] And we held our Investing Club monthly meeting today and ran out of time to get to all the questions we're going to answer. So, tonight we're going to take a few more. You'll get a sense of what we're all about and stay with Cramer.

Don't miss a second of Mad Money. Follow [music] @JimCramer on X. Have a question? Tweet Cramer #MadMentions. Send Jim an email to [email protected] or give us a call at 1-800-743-CNBC. [music] Miss something? Head to madmoney.cnbc.com. [music]

What the heck just happened to the stock of GE Aerospace? I mean, here's a stock that's been roaring ever since it was spun off in its old power business, GE Vernova, in the spring of 2024, up over 130% in a little more than 2 years and one of my faves.

But a couple of weeks ago, the market's hottest stocks started cooling off. Now, that includes GE Aerospace as so much money went to the data center stocks. Then today the company reported a quarter that was poorly received, even though I thought the results looked pretty darn good. To me this is a fabulous buy opportunity. Let me tell you why.

We look at the numbers, they're excellent. All right, GE Aerospace saw total orders up 17% year-over-year, revenue up 24% coming in much better than expected, and while their operating margin declined a bit, they still posted a 16-cent earnings beat off of a dollar 86 basis. That's 22% earnings growth. Oh, and by the way, as I told Larry Culp, the CEO, I cannot believe that free cash flow. It shot up 43% free cash flow for a company like this just [music]

Now the company is showing real strength in commercial engines and services business, that's the main one, where orders grew 18% and revenues up 27%. Now much of that came from the service side, but that's good because the service business is sticky with big margins. Plus equipment revenue was up 30%, better than a sharp stick in the eye. GE Aerospace makes money selling you jet engines, then they make more money servicing those engines for years and years in the future.

As for the other side of GE Aerospace's business, defense and propulsion technologies, hey, that was really solid, too. Orders up 12%, revenue up 16%. I remember when that business wasn't so great. This part of the business is more dependent, of course, on government spending than the free market, but I saw nothing worrisome about the defense side at all. And that's not always been the case.

Best of all, GE Aerospace also raised its full-year forecast across the board. It now expects revenue growth in the high teens, up from double digits in the previous forecast, and they raised their earnings guidance by 50 cents at the midpoint, taking it to a $7.65 to $7.85 range. At the midpoint, they're talking [clears throat] about 22% earnings growth.

BUY BUY BUY. Very good forecast.

And when GE Aerospace last reported back in April, the company similarly smashed expectations, but it had also declined to raise its full-year outlook because the environment felt too uncertain with the price of oil surging in response to the war with Iran. Now though, they gave us a straight beat and raise, even though we know things are a little... Well, well, you exactly know what Iran... What's happening in Iran. Or maybe. But clearly investors were looking for more because the stock just got poleaxed.

Sell, sell, sell. It's down 4% today. The reason? Well, the one I saw cited the most came down to worries about a slowdown in order growth. For context, last year GE Aerospace put up 32% order growth and in the first quarter of this year orders were up a whopping 87%. So yes, when orders merely grew at a 17% clip in the second quarter, that's a deceleration. Technically, the sales and earnings growth are decelerating, too.

As I said though at the top of the show, this is a silly thing. It's not right. You've got the wrong way to approach it. GE Aerospace is just a fantastic company in a great moment. Let's start with the idea that the orders are slowing, okay? But the quarter GE Aerospace also disclosed that its backlog had grown to more than $210 billion.

To put that in perspective, the company's supposed to do roughly $50 billion revenue this year. So that backlog represents about 4 years worth of business. Orders in aerospace are famously lumpy. So I'm not worried, at least not too worried, about quarter-to-quarter fluctuations. Here, what matters is they have many years worth of orders already in the bag.

As for the company's gradually slowing sales and earnings growth, that's just the law of large numbers. It doesn't mean that there's anything wrong with the business. Plus, GE Aerospace is famously conservative with its guidance, which is why they didn't raise their full-year forecast last quarter. So don't be surprised if revenue growth this year ends up coming in above the new high-teens target. When I was going over it with Cole, I just said, "Wow, I don't know how much things are going to be up." But you know what? People take everything as negative these days. It's wrong to.

Looking beyond those specific worries that punished the stock today, I am still bullish on this story because, well, I actually read the conference call today, unlike most of the sellers. I say that because if they had read the call, they would have heard about a business that's firing on all cylinders.

Management said there's strong demand for all parts of its business. The worst part of its demand, if you want to call it that, was aftermarket demand, where management described it as {quote} resilient despite a dynamic environment. Basically, the airlines weren't flying as much in the first half of the year, we know that, right? So, they don't need as many replacement parts and services. But, management said they {quote} expect a return to modest departures growth in the second half, end quote. That sounds good enough to me.

Meanwhile, demand for new engines remains excellent, particularly for the company's latest generation LEAP engines. These are the primary engines for some of the world's most popular narrow-body jets like the Boeing 737 MAX, the Airbus A320neo, because they offer improved fuel efficiency, which we know we need because jet fuel's really high right now, longer service lives, and a lowered total cost of ownership.

Finally, management said {quote} Within defense, we continue to support robust demand for our services and products both domestically and with allied partners, end quote.

The last part of the positive story? For years, one of GE Aerospace's biggest problems was that it simply couldn't make new products or get through its backlog of services fast enough. Largely thanks to bottlenecks within the company's own supply chain. And I don't know if you remember, you watched our show up at Harvard Business School, Larry Culp described that was the old GE Aerospace.

About 2 years ago though, after the old GE breakup was finalized, the newly independent GE Aerospace began enacting a new operating model it's dubbed {quote} Flight Deck, all caps, which was all about continuous improvement and streamlining operations. This new model has gradually improved the company's manufacturing cadence. And on today's call, management touted much more significant improvements from the program.

For example, management noted the total engine deliveries grew 31% in the first half of the year, and commercial services revenue was up 32% in some specific cases. The Flight Deck benefits are even more impressive. CEO Culp noted one facility in Lynn, Massachusetts, where GE Aerospace makes its F110 engine, that's the primary engine in many US and allied fighter jets. Demand is increasing for the F110, and the company used Flight Deck to reduce its overall production lead time for a critical component by 60%. The result, deliveries of the F110 were up over 50% year-over-year.

I don't know many businesses that can pull this off. So, here's the bottom line. After today's 4% decline, GE Aerospace is now down roughly 10% from its peak 2 weeks ago. And I think that makes for a tremendous buying opportunity. It's very rarely down that much from its high. Company reported a terrific beat and raise quarter, yet you're not just getting that quarter for free, you're now getting it for a sizable discount.

Do you already own it? Well, you got to hold it. And if you don't own it, and you want a non-tech company with real growth, [music] this is your chance to start a position. Mad Money is back after the break.

Coming up, the trucking stocks were on a roll heading into last night's earnings, but did J.B. Hunt manage to [music] deliver on that hype? Cramer's going under the hood to find out. Next.

For years, we were stuck in a seemingly endless freight recession, and the trucking stocks were dead money. No one ever talked about them. But, over the past year or so, the group's caught fire again because suddenly business is booming. Take J.B. Hunt, one of the top trucking plays, with a stock that's now nearly 54% year-to-date, 97% over the past 12 months, including a monster 8% gain today in response to a terrific quarter. And to think it doesn't even sell a disk drive.

When J.B. Hunt reported last night, the numbers were phenomenal. They reported a big revenue beat, 19% growth. Earnings came in about $1.91 per share. Wall Street was only looking for a buck 74. That's 45% growth year over year for a trucker.

Operating expenses consumed a smaller percentage of revenue, the operating ratio, key number, improving to 92.6% from 93.3% a year ago. Hence the surge in profitability. The two major subsections of the business, intermodal and dedicated contract services, both beat revenue expectations handily.

Specifically, J.B. Hunt moved more than 578,000 intermodal loads this quarter, trucks on trains, when analysts were expecting 537,000 loads, setting a quarterly record. By almost double digits for the first time in over a decade. And this is something that improved over the course of the quarter. June was much stronger than April and May. That's called the cadence. And the cadence was fabulous.

When I covered J.B. Hunt two quarters ago, I told you they reported terrific numbers, but it seemed more about good management than a broader recovery in the freight market. This time though, CEO Shelley Simpson made it very clear that freight's booming. On the conference call, she's playing that the supply of trucks has shrunk, something you'd expect after a four-year freight recession, while the demand for those trucks has been gradually improving. Six months ago, she said the, quote, "Freight market feels fragile," end quote. She's not hitting us with those caveats anymore.

Hardly. Granted, J.B. Hunt isn't saying that freight demand has exploded yet. It's improved modestly. The real positive is that there just aren't enough trucks on the road these days,

giving companies like this one a lot more pricing power. Here's how Simpson put it in the conference call, very eloquent. Quote, "We didn't spend the last four years waiting for the cycle to turn. We spent the last four years preparing for it." End quote. I like that. That's a great line. J.B. Hunt spent the freight recession cutting costs, improving services, investing in technology, and taking market share. Now that demand is coming back, and these investments are finally starting to pay off, it's like a coiled spring. In a normal freight cycle, rates rise, carriers make more money, and then new trucks and drivers quickly flood the market. That new supply eventually kills the cycle. This time though, the barriers to putting capacity back into the system may be higher. Insurance is much more expensive. Equipment is more expensive. Driver recruitment is harder because who wants to learn how to drive a truck when everyone's saying that autonomous driving is the future. Regulators are more focused on road safety and who's behind the wheel.

That could make this freight upcycle much more durable, much more lasting than the last one. At the Wolfe Research conference last month, J.B. Hunt said customers' routing guides are beginning to fall apart. Now, this was critical to me. See, historically, a shipper might reopen bidding on a couple of lanes or a few hundred loads. Now, management's seeing what used to be called mini bids turn into rebids of entire networks, sometimes involving tens of thousands of loads. That means truckers are rejecting more freight, customers are scrambling for capacity, and this industry suddenly has something it hasn't had in ages: pricing power. I can't recall a better time to be in this business in this environment. J.B. Hunt's in a terrific position. By the way, now, to be clear, I also like FedEx Freight. Now, that is a new company recently spun off from FedEx. CNBC Investing Club members heard about that story in today's conference call, and it's a terrific one. Of course, J.B. Hunt's quarter wasn't perfect. Their truckload business posted weaker than expected operating income. The independent contractor market remains difficult, forcing J.B. Hunt to rely more heavily on third-party capacity at current spot rates.

Management said pricing implemented just a few months ago was already insufficient for today's cost environment. To say, basically, the trucking market's in great shape, but that also means this company needs to pay more when they outsource to independent truckers. Meanwhile, their final mile business saw an actual decline. That's sales down 6%, operating income tumbling 30%. Final mile is the part of the trucking food chain where they deliver stuff to your door. But a lot of the weakness here is simply because J.B. Hunt literally walked away from lower quality business. And besides, this is more a piece of the pie. All told though, this was a terrific quarter, which is why the stock justifiably soared. But after this move, okay, J.B. Hunt's starting to look a little expensive here, trading at 38 times earnings. I thought it was expensive at 27 times earlier this year. And while I bet the numbers will continue to improve, 38 times earnings makes it a little harder to justify. The numbers go up, it won't be though. She told a terrific story in the conference call, but a lot of what she said will happen already. I don't know, let's say it's in the stock. But this was still the quarter the bulls were waiting for, the beginning of the cycle. It's good news for more than just J.B. Hunt. It gives us real reasons to feel much better about the entire freight market. The turn may be driven more by a shrinking supply than exploding demand. A turn is a turn. J.B. Hunt is a market leader at scale, technology, multiple transportation modes, excess intermodal capacity, and an investment-grade balance sheet. It can gain share while smaller competitors simply try to survive. And those guys have been waiting for the moment to come roaring back, and the little guys won't be in.

Here's the bottom line. Six months ago, J.B. Hunt told us the freight market was fragile, and that it was not holding its breath for recovery. Now though, so much trucking capacity has left the system just as demand is finally starting to bounce back. That's how J.B. Hunt was able to report a much better than expected quarter. It is why I'm feeling more bullish on the entire group. That said, I don't know. Don't want to necessarily chase the stock at these levels. You're already paying for continued recovery. But this story is fantastic. J.B. Hunt spent the downturn cutting costs, improving service, reducing debt, buying capacity, and taking share. If the freight cycle is genuinely turning, and I think it is, these are the guys who should benefit first and benefit the most, with the possible exception of the newly spun-off FedEx Freight, because there is so much improvement ahead for them, and with self-help. In other words, what am I doing here? I'm trying to tell you about other companies, other than disk drives, other than companies that make things for the data center. There's a whole world out there that you need to know. Unlevered stocks with people who own the stocks and hold them long term and aren't just trying to make a quick buck. And that's what J.B. Hunt is. Let's take a call from Kevin in California, please. Kevin.

Fantastic, and I'm glad you are. How can I help?

I did some work on Union Pacific today, and I have to tell you it's got great management. The idea that it's at an all-time high doesn't worry me. This is not a company that makes semiconductors. It's a company that's dominant in an oligopoly. You want to own the stock. Let's go to Sam in Texas. Sam.

Thank you very much. Thank you.

All right, this Chris Calio who runs it, the CEO, he's on here a lot. It's terrific. You know, you've got defense, but you have commercial. I like the mix. I think the company's doing terrifically great. Hayes left it in great shape. You want to look at RTX down here? No, it was in the 170s recently. I would wait till it gets back to the 170s, but that's a very strong story. Yep, the freight cycle really is turning around. I think J.B. Hunt could be the one, let's say one along with FedEx Freight, that's really going to benefit. I like them both. Much more Mad Money yet. We had our Investing Club in New York City meeting today as I have referenced, but I'm not done yet by Market Wizard. So, you got a few more questions that we need to get through from the club. Jeff Marks and I like to get to everybody. I always say, by the way, that panic isn't a strategy. So, why are the chip investors not listening? I'm taking another look at the bleaker cohort and telling you what I think is really going on. You don't want to miss that. And all your calls rapid fire tonight, stay tuned for winding up. So, stay with Cramer.

Earlier today, we had our Investing Club monthly meeting, where Jeff Marks and I get together and walk club members through our decision-making process for the portfolio. Oh, I tell some stories, we discuss our current holdings, then we take questions from club members. But since we never have time to get to all those, I'm giving you an inside look right now at what happens at the monthly meetings, while also doling out, I hope, some much-needed advice about the market. I think if you join the club, you will get insights on how to manage your portfolio. You'll get some laughs, too. The stories tend to be some of the best I can gin up. Hey, by the way, if you want to be part of the monthly meeting, which I sure do want you to be, join the club. Just scan this QR code behind me or go to cnbc.com/investingclub. I save some pretty good stuff for the club, let's put it that way. Now, to start us off, we've got Daniel, who asked, "I bought Oracle for my Roth IRA 2 years ago at $140. Should I leave it alone or sell it and buy something else?" I don't care where you bought a stock, I care where it's going to, and I think that stock is going down. It doesn't fit in for what I would consider to be an IRA. I think it's too risky. I think you should sell it. Then we have Dennis, who says, "With the November midterm elections close, is it better to put new money to work now as opportunities arise or wait for potential post-election pullback in the market?" We buy individual companies that have stocks. If we think that the company's stock is low, we buy it. If we get another opportunity to buy it even lower from an election, we buy more. That's what we do. We are stock pickers. We are stock owners. We are not renters. Next up, we have John who asked, "The sector's taken a significant hit, but I think Diageo has historically been the best in class. Is there a point at which you would buy this beaten-down stock as a long-term gain?" I know this liquor business cold for some other things that are involved with my life. And I've got to tell you, I would not touch any liquor company right now. There are a lot of ones, the gins, the vodkas, the browns, they're all doing terribly. You don't need to try to call a bottom. Next up, we have Wade from Texas who says, "Jim gets a lot of questions about speculative stocks and Mad Money, and he's always clear about allocating appropriately. The trust doesn't really have any spec positions, and I'm curious if Jim would ever consider adding one. Maybe the club doesn't need it because it's doing well, but curious to hear your take." Well, it's a charitable trust, so I always think that those shouldn't be involved. I do like speculative stocks. I hope one day to be able to talk and have some interesting products that are about speculation, but it is a charitable trust. Then we have Big Mike from New York. Jim, "With the first half of 2026 now in the rearview mirror, what sectors do you feel offer the best investing opportunities for the remainder of 2026?" I like the banks. I like the pharmaceuticals. I tell you, I know it sounds crazy, but I love travel and aerospace. And then I will like tech when the big unwind is over, particularly some of the less speculative semiconductors that I think are really great. You're familiar with them if you watch any of the shows or stuff that we do with the club. Also, we have Joe from North Carolina who asked, "What general method would you recommend to reduce the number of holdings in a portfolio getting too large? I'm at 45 holdings and would prefer to be at the 25 to 30 range. All of them are in good shape or strategic. It's getting tough to do the necessary homework." I totally agree. I talked at the end of the club today that I have 34, I want to reduce it to 30. Rank your holdings. So, one means you got to own it and buy more if it comes down. A two means you're okay with it, but you're a weak holder. A three means you get rid of it today. You cannot possibly have all ones. There's nobody that has all ones. Do that and sell the threes. Next, we have Eric from California who says, "I retired a year ago and have a large position in company stock acquired through RSUs, employee stock purchases. It's now about 10% of my total portfolio. How would you reduce the overall weighting in my portfolio since I don't think it will grow as fast as other options?" Okay, you may find this to be a little counterintuitive, but 10% is actually not that much. I think you're in good shape. If you don't like the stock, by all means sell it. There's no reason to hold on to any stock that you don't like. I've got plenty of stocks in the charitable trust. There's got to be one of those 30 and change that you do like more than what you got the RSUs in. Last but not least, we have Bob who asks, "If you were to get a new puppy and wanted to name it after a public company, what would you name it?" Well, I'd say by Tuesday I might name it Intel. Thanks again to all our club members and Mad Money is back after the break.

Coming up, he's the fastest mind on Wall Street, so we're putting him to the test with your help. Bring on the lightning round. Next.

It is time. It's time for the lightning round given by That's right, Dave. Cramer. Jim, how are you doing? You name the stock, I tell you to buy, not buy, sell, not sell, to do the four stock versus the I stand corrected Jim, how are you doing? We finally sound. And then the lightning round is over. Are you ready, Steve? Dave, time for the lightning round given by Let's start with Bill in Sweet Home, Alabama. Bill.

Well, it's a semiconductor and all the semiconductor stocks are going down. May I suggest that you wait a few more days till we get rid of all the margin players, and you're going to find a bottom. I don't see it yet. Let's go to Sunshine in Florida. Hey, Sunshine.