Mad Money 04/15/26 | Audio Only

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Hey, I'm Cramer. Welcome to Mad Money. Welcome to Cramerica, my friends. I'm just trying to make a little bit of money here. My job is not just to entertain; it's to teach you. So call me at 1-800-743-CBC. Tweet me, Jim Cramer.

Something is not right, and we've got to talk about it. Remember what happened last year when speculative stocks took over the market? They climbed and they climbed and they climbed ever higher as complacency and overenthusiasm took over the field. I called it the year of magical investing. I said, "Enjoy it while it lasts, because it's going to end and end badly." Sure enough, in the middle of October, speculation peaked, and the year of magical investing came crashing down.

I bring that up because we've had a huge run here, a run that continued today with the Dow gaining 115 points, the S&P advancing 0.26%, and the Nasdaq edging up 0.36%. And those same speculative stocks, unfortunately, are leading the way. But let's pull it apart so I can tell you what's really going on, because I don't want you to get hurt. First, as I explained last night, we've come up real far, real fast. The rally is now long in the tooth by every single admission. Nevertheless, there are plenty of people who get too enthusiastic right about now. Every time there's a rally, they think that anything they buy goes higher. They actually think they're geniuses. They lost all discipline. They're too cocky. Same as last year. Cocky is not a positive trait when you're buying stocks. They know nothing.

Incredibly, what did these people get excited about today? The exact same stuff that first made and then lost them tons of money last time: nuclear power, quantum computing, and space. Look, I love nuclear power. But even with a more favorable regulatory environment, it's just not a great business. Building nuclear plants costs too much and, by the way, takes way too long. That's why the vast majority of publicly traded utilities want nothing to do with them. Not after the disastrous Southern Company, which had severe overruns when it tried to finish the last two out of four new projects that it had. It took 15 years for Southern to build two nuke units thanks to design complexity and problems with the supply chain, as well as the bankruptcy of the builder. It became a joke. Everything that could go wrong did go wrong. The original estimate: $14 billion. Final cost: about $36 billion.

Look, I'm not dismissing nuclear power. If you want clean energy, it is your best solution. I'm just saying that because of its complexity, you need to go with bigger companies that aren't going to go bankrupt during the construction. The other night, I was stalking around looking for discounted growth, and I named Vistra. It's a very good independent power producer with plenty of nuclear exposure. I'd buy it.

I also like Constellation Energy, which is trying to restart Three Mile Island. The company knows nukes, has a bunch of nukes in its fleet, and I think represents decent value at these levels. I also like GE Vernova as well. That's the power plant maker which is building a small modular nuclear reactor in Ontario and is also a partner in building a nuclear reactor plant for the Tennessee Valley Authority. GE Vernova is a terrific company, and we talked about that today at our monthly CNBC Investing Club meeting. We're comfortable with the numbers and the timeframe.

How about the quantum stocks? I believe that one day quantum computing will be very important, but today is not that day. Right now, the publicly traded companies are just science projects. They all talk a big game, but again, the only viable quantum businesses belong to Google, IBM, and Honeywell. I own Google for the travel trust. I also think IBM is a terrific buyer. Honeywell is spinning off its quantum business, known as Quantinuum, later this year and owns 54% of it. It looks a little more than 50%, but it's still a very valuable asset.

Space is easier because of the mammoth IPO of SpaceX, brought to us soon by Elon Musk, maybe later this summer. I think it's going to be a huge hit. In the interim, anything that looks like SpaceX should go higher, including Rocket Lab. I'm blessing Rocket Lab because it's got a $1.85 billion backlog, giving them terrific visibility in the future, although it was up a lot today. Needless to say, to get your hands on any SpaceX might be difficult, but I think it'll be a better performer than Tesla. Why am I so adamant that speculation is getting out of control again? Well, exhibit A has to be a company called Allbirds. I got a pair of Allbirds in my closet.

They're not doing anything. When I bought them, they were cool. Not so much now. These, I think, these New Balances — I have a problem with my ankles — these New Balances I think are a lot cooler, frankly. Six weeks ago, Allbirds seemed to be headed into the dustbin of history. Stock was at two bucks and change. The company is losing fortunes. It has been ever since it came public. It doesn't make any money. But rather than shut down, it did something I'm sure it thought was genius.

Allbirds sold its shoe business to American Exchange Group, and it announced a definitive agreement with an institutional investor for a $50 million convertible bond, which, and I'm quoting from the release here, "will enable the company to pivot its business to AI compute infrastructure with a long-term vision to become a fully integrated GPU as a service and AI native cloud solutions provider." End quote. Yet they pivoted from casual shoes to AI, and they're changing the name to Newbird AI. The company sees a need for more compute, and it's going to bridge the gap. They say that Newbird AI will, and I quote, "initially seek to acquire high-performance, low-latency compute hardware and provide access under long-term lease arrangements meeting customer demand that spot markets and hyperscalers are unable to reliably service." End quote. Oh, I got it. There's a compute shortage, and we know who to call: a casual shoemaker.

Who would know more? I can't think of anyone better positioned, say, to negotiate toe-to-toe with Taiwan Semiconductor or go at it hammer and tongs with Jensen Huang from Nvidia for chips than the Allbirds people. Think about it. They know lasts. They know canvas. They know rubber soles. Those are three of the most valuable traits when you're butting up against Michael in Trader Joe's, right? Oh, and of course they probably think that if a Bitcoin miner can switch to a data center manager, why can't a shoemaker do the same thing? Of course, there's a simple answer: Bitcoin miners already run data centers as part of their business. Allbirds wasn't even a successful shoe company, for heaven's sake. Yet the stock rallied nearly 600% yesterday on this baffling news story.

It does have me thinking, though. Nike's been a really tough stock to own. Why not open a Jordan line of GPUs? Just do it. Maybe On Holding could do a line of always-on holding that could rival CoreWeave. Maybe the way for Under Armour to get back in the game is to go all in on GPUs. CEO Kevin Plank once owned a liquor business. He's versatile. Seriously, you want exposure in this area? Last night, Taiwan Semi, the actual maker of chips for Nvidia, said that CPUs are in short supply. That means go buy AMD and Intel like everyone else. Those stocks are up a lot, but it's certainly better than buying this convertible.

I mean, I just think that — well, you know how I feel about this. Oh, no, wait a second. I got a better idea. Instead of buying Allbirds, maybe buy Nvidia. Call me crazy, but when it comes to GPUs as a service, I want to go with Jensen, not with the really nice people from Allbirds. I just think he knows more and has a real sense of the industry. Allbirds couldn't even figure out footwear. And I have still one more idea. Allbirds — I'm an idea machine — Allbirds is basically creating an all-new company here. It's doing so without any vetting, any actual scrutiny, because there's a publicly traded shell that it can creep into. Before this gets too far down the road, maybe the SEC gives the people from — give the bird people, you know, a jingle and suggests maybe, I don't know, review the company to be sure it isn't just a colossal joke.

Look, I'm a free-market guy from way back. But the bottom line is this one's a speculative bridge too far for me. Newbird AI belongs where allbirds belong: at the back of your closet, if not a cage.

Norma in New Jersey. Norma.

You're in the red? Cava's at 91. You're not in the red. You're doing great. And I totally agree with you. 212 Cava. I just think it's exactly what you said. I think it actually might be the next Chipotle. I want you to hold on to it. If it comes down, I think, Norma, you should buy more. And thank you for calling. How about we go to Eugene in Ohio? Eugene.

Holy cow. Thank you.

No, there's nothing there. Let's just — like, you know, I've been fighting this Snap now for I don't know how many years saying don't invest in it, and so far I'm looking pretty good, frankly. Let's go to Rich in Texas. Rich.

I am doing well. How are you, Rich?

No. No. Reddit should not have been down that much. I wish Steve Huffman would come on because he knows how much I think Reddit is a very, very valuable company. And I got to tell you, if I had a bigger company than I could and snap up that $31 billion business, I would do it. I think that you can train on their stuff. It's very exciting. Yes, it's been up a lot in the last week, but so have many other stocks. I really think that that is one that you want to own. Okay, guys, listen to me. The symbol is BIRD. All right, I am all for free markets, but what's happening with Allbirds is just one speculative bridge just too far for me.

On Monday Tonight, shares of Shake Shack have been put on the back burner this year. But could the burger chain start serving up some big gains for you? I'm taking a closer look. Then, wow, it debuted today: Madison Air Solutions. You hear them people going like, "Matt, when I was trying to do the show at 9:00 and they wouldn't let me think." That's okay. I don't need to think. I can just do it. I read cue cards. Actually, not. But I'm running through the name to tell you if it's a buy. And Braid plays a pivotal role in keeping our financial markets running. So why has the stock been taken to the woodshed? I say we talk to the top brass to find out. So stay with Cramer.

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Everybody likes Shake Shack, the burger chain that started as a hot dog cart in Madison Square Park. You know what? And that's why the stock's been so frustrating. When you walk into a Shake Shack, there's usually a line, and it's one of the best burgers you can get. Yet if you bought $1,000 worth of Shake Shack five years ago, you'd have only about $850 left today. I mean, talk about a suboptimal return. The company was doing great when COVID showed up, but the pandemic gutted their business, and it took three years for Shake Shack to become profitable again. Even after the world reopened, Shake Shack still had to prove more to Wall Street. Investors became less willing to pay up for companies that felt special but didn't look efficient enough. Then the GLP-1 weight loss worries hit, and consumers also started pushing back against high prices. Shack ain't exactly cheap. I mean, you're going to spend at least 20 bucks if you want a real meal: a burger, fries, and a soda. It's a premium fast food chain. There are not a lot of those. It's hard to figure out what the peers are, but that does mean you pay premium prices.

I bring all this up, though, because I think the business has improved dramatically in recent years, something that's not really reflected in the share price, even with the stock's nearly 23% bounce year to date. Let me set the scene. After the pandemic, the business only really got going again in 2023 when Shake Shack's revenue hit $1.08 billion with profits of $16.2 million. In 2024, the revenue climbed to $1.253 billion, net income still growing to $40.5 million despite rising beef prices. Then last year, revenue hit $1.445 billion and then income jumped to $58.3 million. So, I mean, long story short, with that trajectory, I think Shake Shack's back.

Now, a lot of that is thanks to Rob Lynch, a guy we've had on the show a bunch of times. He's just terrific. He took over as CEO of Shake Shack in March of 2024 after a long stint running and, I think, turning around Papa John's. When Lynch took over, he didn't inherit a broken brand. He got a beloved brand that simply needed better execution. That's the opportunity here. You see, Shake Shack never had to fix the product. Its burger never went bad. It had to fix the machine around the burger. And that's exactly what Lynch has been doing. He's great at that stuff.

You can already see some of that deeper in the numbers. The company's restaurant-level margin got to 22.6% for the full year, driven by operational improvements, supply chain savings, and labor efficiency. Build costs for new stores came down 20%. That matters a lot because investors don't just want more locations; they want more locations with better returns. The stock's now up nearly 23% since the start of 2026. There's a real chance that Shake Shack reports again in early May. Same-store sales will come in at the high end of expectations, helped by value offers — we love those — menu innovation, and improving trends over the course of the quarter.

But even with the quarter strong, management may not rush to raise their full-year forecast because beef prices are rising and their international licensing business has meaningful exposure to the Middle East. That could potentially give you a buying opportunity. But I have to tell you, it's going to hurt the numbers.

Long term, though, I think Shake Shack's biggest advantage is the fact that they haven't alienated their customer base like so many other restaurant chains, which, if you know, you know, they took the price up a lot of these places. People got very upset. Most chains spent the last few years leaning too hard on price. They kept pushing menu prices higher and higher, sometimes because they had to and sometimes because they could get away with it. In the process, customers felt ripped off. Well, Shake Shack's kind of always been on the expensive side. They were less aggressive in the price hikes, and they always made sure to keep some cheaper alternatives on the menu.

Now, historically, Shake Shack has underinvested in marketing. Now that they're firmly profitable again, there's a real push to spend more on ads. I think that's a smart move. This is a brand that still has lots of room left to widen its audience. And then there is the operational stuff that matters more than people usually realize. This is not just about ads and new menu listings there. It's a throughput issue. They're getting faster and tighter in the stores. Ticket times have improved. Kiosks now account for more than half of the in-shack. I can even use the kiosk. I actually figured them out, and I'm terrible at kiosks. Labor deployment's gotten smarter. There are small equipment changes and kitchen changes that can improve speed, consistency, and get rid of waste. Now, none of that's flashy, but it improves throughput. And throughput's the name of the game in this business.

Of course, that does not mean the risk is gone. The biggest swing factor for Shake Shack is still beef. The stock's been heavily tied to cattle and beef prices. It's the stock more than the company, okay, which is one reason why it's been such a frustrating performer. If beef spikes, the margins get hit, and then the stock gets punished. That's right. But even so, even if Lynch is doing a good job, even if traffic's holding up, even if the long-term unit growth story is improving, this thing can still get clipped if input costs move against them. That's just the reality of the business. I saw it with Texas Roadhouse, and for the past few years now, beef's been moving in the wrong direction.

There are also some macro considerations we got to talk about. The World Cup could matter, especially given how many Shake Shack locations sit in your host cities and high-traffic areas. I don't want to overemphasize that point. This isn't Constellation Brands, which will make a fortune from the World Cup, but it's fair to say Shake Shack may have more traffic help coming this summer than the average burger chain. Then there's the all-important store growth. Shake Shack put up 45 new locations last year, and this year it's expected to grow its footprint by around 15% with cash-on-cash returns moving toward 50%. If the company can keep getting better unit economics, then this stops being viewed as a recovery story and starts becoming the great growth story that it used to be.

Of course, the stock's been a disappointment for six years now, but that's exactly why I think it's really interesting. The expectations got reset. The story got less romantic. The market got tougher. And in the middle of all that, the business actually seems to improve dramatically. That's why I think Shake Shack should not be held down forever by its reputation. If CEO Rob Lynch keeps doing what he started doing — tightening operations, lowering build costs, protecting the customer relationship, spending more intelligently behind the brand, and scaling without messing up what made Shake Shack special — then this can absolutely become one of those stories where the company quietly fixes itself up before the stock really catches on.

Doesn't mean Shake Shack will go straight up. I told you I can't emphasize enough how tough beef is. Okay, the high price-to-earnings multiple here also can still hurt them. One bad quarter can still knock the stock around. But the bottom line, when you zoom out, the picture looks pretty clear. Shake Shack was doing well, got floored by COVID, then sales came back first with profits lagging. Now it finally looks like the turnaround may be real. I know I'm a believer, and more importantly, I am a satisfied customer. Mad Money's back after the break.

Coming up, the largest IPO of 2026 so far just dropped. So should you be buying in? Cramer's looking into Madison Air to see how fresh it could be. Next.

With the market now fully recovered from its Iran-related weakness and back to setting fresh all-time highs, it makes sense that the IPO window would open again. And sure enough, today we got the largest new listing of the year: the IPO of Madison Air Solutions. That's MAIR for you home gamers, which is a commercial airflow and cooling company. All right, this one's intriguing because Madison Air is in some really attractive end markets like semiconductor production, advanced manufacturing, and of course equipment for the data center. That's why tonight I want to walk you through this story.

Pictures of windmills. Can't beat that. Let's start with the basics. Madison Air calls itself a, quote, "leader in the mission-critical indoor air solutions market." Are you mission-critical? I'm mission-critical. Offering its customers advanced air — yeah, offering customers advanced airflow and cooling technologies that, quote, "deliver superior air quality and tangible results: higher productivity, lower energy costs, and improved operational performance in the most demanding environments." End quote. Their business includes a data center cooling unit, a division that purifies air for semiconductor fabrication facilities, a commercial high-volume, low-speed fan business with a name I can't repeat on air, and a couple of residential-focused brands that think air purifiers, humidifiers. Overall, 63% of Madison Air sales come from commercial products, with the other 37% being residential.

Now, sometimes companies can go a little overboard in creating a story for themselves, a bit of mystique as they come public, and some of that's happening here. Madison Air said in its prospectus that it's focused on ROA, or return on air, which they define as the tangible value created when air becomes a strategic asset. They cite all kinds of stats to elaborate on this. Their equipment can save up to $9,000 per minute by preventing downtime for data centers. Clean room airflow control can reduce contamination incidents by up to 30%. Standardized test scores go up as much as 5% for students in classrooms with improved air quality, and so on and so forth.

I got to tell you, I'm unmoved by this idea of ROA, return on air. There's no need for Madison Air to overhype itself like this. At the end of the day, we're talking about a company that makes high-quality products for a series of attractive end markets. What more do you need? Frankly, this is basically a successful rollup that's made a bunch of smart acquisitions over the past decade to build itself into an airflow and cooling powerhouse. That's the best way to think about Madison Air. It's a shrewd rollup with an attractive set of industrial end markets. It's somewhat similar to Power Solutions, another one we like, the rollup of the electrical equipment space, which was the largest IPO of the year until Madison Air came along.

So that's the basic story. How do the numbers look? Honestly, pretty good. Making some adjustments to smooth out the numbers after the acquisition of April Air last year, we can see that Madison Air's pro forma revenue grew modestly from $3 billion in 2023 to $3.1 billion in 2024, but then jumped to $3.5 billion in 2025, a 13% increase from the prior year. The fact that Madison is accelerating revenue growth makes the story even better. The company's also solidly profitable, with their EBITDA margins rising from the low 20s to the mid-20s over the past few years. Pretty good. What else? First, the balance sheet looks fine here. Madison Air is going to use all the proceeds from this IPO, meaning over two billion dollars, to pay down debt. After that, it expects to have about $3.3 billion in net debt and a leverage ratio of —

About three and a half times, which is not bad at all in this industry, especially from a rollup. The company also has strong cash flows, and I like to see that it had $4.39 billion in orders last year, and it ended 2025 with a backlog that was just over $2 billion. And again, the numbers are overall really strong for Madison Air. So, this company's got a good story, impressive financials, but what about the valuation here after the stock shot up more than 17% today as part of the debut?

The deal priced at 27, at the high end of the proposed range. Took a long time to get the stock open. Today, it opened for trading at $32 before finishing the session at 31 bucks, 31 and change. I think the best way to look at the valuation for Madison Air is with what's known as an enterprise multiple, measured as enterprise value. Enterprise value means that's the market capitalization plus net debt divided by earnings before interest, taxes, depreciation, and amortization. For anything capital intensive, that's a more informative way to look at things than the price-earnings multiple. We have to use last year's numbers. It's not ideal, I know, because we don't have enough information to come up with even a back-of-the-envelope forecast for 2026. I want to compare Madison to Vertiv, another company I really like, a leading supplier of power and cooling equipment for the data center, as well as three classic heating, ventilation, air conditioning, HVAC companies: Carrier Global, Johnson Controls, and Trane Technologies.

When you stack these stocks up against each other, I have to say that I think Madison Air looks pretty darn reasonable. At nearly $32, the company has an enterprise multiple of around 20. That's well below Vertiv, but it makes sense as Vertiv has better earnings growth and is strictly a data center and industrial story. An enterprise multiple of 20 is basically in line with the three classic HVAC players I mentioned, which have enterprise multiples in the range of 16 to 25, despite the fact that Madison has the best EBITDA growth of any of these companies last year. So, you know what? I think Madison Air can be bought right here, right now, even after the stock's strong debut. For an initial price target, I'll throw out 41 bucks, which would give the company roughly the same valuation as Trane, the most expensive HVAC comparison here. Of course, we'll have to see how the estimate looks once the analyst quiet period ends, but I'm pretty optimistic about this. In fact, because I like the story and because I like the ticker, I'm going to do something that I don't usually do except for really well-established companies like Microsoft, Mr. Softy, or of course Nvidia, which is the name of my late dog. I'm going to give Madison Air Solutions a nickname: Mayor of Easttown, after one of the best HBO shows in recent memory. Most authentic Delaware County, Pennsylvania accent impression that I've ever seen. Painfully authentic, even as I am from bordering Montgomery County. But here's the bottom line: the market has bounced back and now the IPO market has reopened for business with the largest deal of the year. Fortunately, it was a good one. I like the Madison Air story. I like the numbers, and the price still looks fine to me even after solid pricing and a good open today. Even after this move, I think Mayor of Easttown is a buy. All aboard!

Well, maybe they should do that. This has been such a disappointing stock. The other day, Sam, we talked possibly about First Solar. I know you don't want to hear that. You're looking more at Enphase, but we think First Solar is better. And I tell you, Enphase has just been a disappointment for too long. Let's go to Ronnie in North Carolina. Ronnie?

Ah, thank you, Ronnie. What's going on?

Yeah, I do. I do. Now, we did sell the chap committee. Nice gain, but we have so much data center. I felt like that we were taking on just taking on too much. Talk about that in today's meeting. I think you're in great shape, Ronnie. It's doing very, very well. Chuck Robbins doing a terrific job there. All right. Look, I like what I'm seeing from Madison Air. I think the stock can be bought right here, right now. I don't know if you listen to the CEO. She's pretty terrific. Now, there's much more Mad Money, including my sit-down with Broadridge. The fintech player has been the champion for you, for retail investors, for years. I'm learning more about the company. You wrote, wrote, right, Cummings wrote where it's headed with the CEO. Then investing in tech might seem like the only way to get ahead in this market, but tonight I'm digging into one household name that deserves more attention from investors. And of course, all your calls rapid fire in tonight's edition of the Lightning Round.

One of the most exciting things about being a shareholder in a publicly traded company is the fact that, at least in theory, you got a say in that company's affairs through your stock's voting rights. But far too often investors don't even take advantage of it, or maybe they can't. That's why I want to talk to Broadridge Financial Solutions. It's a financial technology company that helps banks and brokers operate more efficiently, communicate more directly with their clients, while also processing proxy voting for some of the largest companies in America. They've made a big push to increase shareholder voting participation, which you know we like here, especially for retail investors. At the same time, Broadridge is the stock that I don't really get it. It's gone down 40% from its peak last August, including a 27% decline year to date. We're going to find out about this. It's one of the many professional services companies that's been hit by AI displacement worries, not facts. So, let's take a close look with Tim. He's the CEO of Broadridge Financial Solutions. Tim, welcome back to Mad Money.

All right. So, Tim, there's a lot to talk to you about. But I don't want to talk about the decline in the stock yet. You're doing something that is very interesting, which is tokenization. But I think a lot of people, when they hear that, they say, 'Oh, I don't understand that. I wish they would just talk about plain old.' But that's too exciting, and you're involved with Mr. No, who's a really terrific guy.

Okay. But what is tokenization? What does that mean?

All right. So that would be something that maybe younger people would be interested in because it's like they're filled with that. I don't know if the older folks would really be that focused on this. Maybe they would.

Oh, okay. That's right. I mean, particularly, I know we had a fellow that represented African gaming, and they would feel much more at home with this, and I don't blame them, especially because some of their currencies are not that strong. What is it with the announcement with Galaxy earlier this month that I saw? I thought it was pretty revolutionary.

Now, how are you at helping us get some voting rights if we have our money with an index fund?

Now, how much money do you make per, I don't know, vote or by a contract that you make with the company? Is that how it works?

Okay. All the things that I'm hearing don't seem to be things that Anthropic would hurt or OpenAI, but your stock is clearly reflecting a drag from AI. Can you tell me, has anyone knocked on the door of any of your clients with a superior product? Because otherwise, to me, it's just something that doesn't make sense.

When I checked research, I didn't see anyone who was just thinking you're endangered. I mean, look, I get it. I get it. Like, you know, intuitively, I didn't think it was endangered. And then Perplexity sends me a ballot and what it could look like, or sends me how to write up my taxes. I mean, is someone sending me a ballot, a mock ballot from, and I just don't get it, like from one of these...

Okay. Can you talk about your program with Exxon, which is a stock that has actually had a great performance?

Well, you're making a common-sense case. I'm in favor of common sense.