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Cramer Remix: Facebook isn't just technology anymore

Jim Cramer has run out of superlatives to describe just how amazing Facebook is.

Somehow this $357 billion company can still generate accelerating revenue growth and 58 percent gross margins. In Cramer's opinion, Facebook is on a different plane than everyone else.

Shares of Facebook initially skyrocketed to $128 at the open on Thursday but pared gains to $125 by market close.

With such an amazing quarter, how could this be possible?

"We have seen bouts of selling after great quarters before. I suggest you use the weakness to buy the stock, because I can see Facebook rolling toward $160 over time, which is where it starts to get classically expensive on an earnings basis," the "Mad Money" host said.

The biggest takeaway for Cramer? Facebook isn't just technology. It is a mobile identity for people. Just as people cannot go without food, they probably can't go without Facebook.

Mark Zuckerberg, founder and chief executive officer of Facebook Inc.
Tony Avelar | Bloomberg | Getty Images
Mark Zuckerberg, founder and chief executive officer of Facebook Inc.

Consumers are driving Cramer crazy.

The market was thrown for a loop on Thursday when Ford Motor Company confirmed in its earnings report that the consumer is stalling, and so is the auto cycle. Ford stock fell by more than 8 percent in response.

"You lose the auto industry, you're losing a major prop to the economy," Cramer said.

However, retail told a much different story about the American consumer when Amazon reported. The online giant reported a 31 percent increase in sales and blew away earnings.

"Those sales are coming out of the hides of other, more traditional brick-and-mortar retailers, and it might just be pretty much a zero-sum game," Cramer said.

Another company that played into the paradigm of retail was Tanger Factory Outlet Centers, which has defied the odds of the shopping mall by offering bargains to shoppers. Hence, the stock is up more than 26 percent for the year.

Tanger reported after the close on Tuesday and delivered a top and bottom line beat, while also raising its full-year outlook for 2016. Cramer noted that for most of bricks-and-mortar retail, there are too many stores. However, when it comes to off-priced outlets, there aren't enough.

Tanger is a real estate investment trust that owns 43 upscale shopping centers in the U.S. Cramer spoke with its CEO Steve Tanger, who explained why re-tenanting is so lucrative. This refers to the process of bringing in the best brand names that can pay higher rent because they have higher sales volumes.

"Part of our skill set is identifying the new hot retailers, educating them on the success of the outlets as a distribution channel, and then installing their first stores and rolling them out," Tanger said.

Amazon's website
Indranil Bhoumik | Mint | Getty Images
Amazon's website

International Flavors and Fragrances is also a company riding a powerful long-term theme, as its technology develops proprietary flavors and scents for the food, beverage, personal care and household products industries.

As consumer packaged goods companies are constantly battling one another for market share, IFF plays an important role in giving companies an edge against one another.

Cramer spoke with IFF's chairman and CEO Andreas Fibig, who explained that desired scents can change based on geography and culture. Together with customers, IFF tests customers to figure out the balance of proper scents for each country.

"That might be a good mixture between acquired taste and taste which is already in your DNA," Fibig said.


Utilities were roaring in the first half of the year as yield-starved investors crowded into the group. However, with Federal Reserve chair Janet Yellen's commentary that the economy has improved to the point where there could be a rate hike later this year, that could mean dividend stocks like utilities become less attractive versus bonds.

American Electric Power is the largest power transmission network in the country, with a major power generation portfolio that serves over 5 million people in 11 states. It delivered a strong quarter on Thursday, with management reiterating its full-year guidance. However, even with 8 percent earnings growth and a 3.2 percent dividend yield, the stock barely budged.

Cramer spoke with AEP's chairman and CEO Nick Akins on what was behind the earnings beat.

"We have been investing in infrastructure, particularly transmission, we have the largest transmission system in the country. The earnings profile of transmission continues to improve dramatically," Akins said.


In the Lightning Round, Cramer gave his take on a few caller favorite stocks:

American Water Works: "That's a buy. We love the fact that they are literally the kind of company that these municipalities have to pay in order to be able to get their water systems working."

Weight Watchers International: "No, not for me. Don't like that business model. There are better stories out there."