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tv   Mad Money  CNBC  December 13, 2016 6:00pm-7:01pm EST

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72 by year-end. >> guy. >> united health comes out unh. >> wow. i'm melissa lee. thanks so much for watching. see you back here tomorrow at 5:00 for more "fast money." meantime, "mad money" with jim cramer starts right now. 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. "mad money" starts now. hey, i'm cramer. welcome to "mad money." welcome to kcramerica. some people want it mato make friends, i just want to make you money. my job is to teach and coach you. look who's back. as the trump rally continues to unfold, all-time highs made across the board. dow gaining 115 points.
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and the nasdaq pole volting 9.5%, it was the fang stocks that led the charge higher. yeah, facebook amazon google and now alpha bet. we've got a marvel there is still one more rotation going on. this time back into the nasdaq. what gives? how did these stocks suddenly get their groove back? first as we put out last week tech never really goes out of style. if it's really good it just simmers and waits and then pounces. this is an age-old pattern yi urged to you buy these tech stocks while they were down rather than abandoning them. how is it that this doesn't always seem to work. for one thing these fang stocks truly have no flies in them. they have a good story to tell. when we have a major move into
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the industrials and they are stretched as they have been these uber tech stocks don't seem as expensive as the rest of the market. take facebook. we know we need to analyze this stock based on what we call the out years. by some estimates facebook is trading at a slight premium to the average stock. now that afterage stock has had such an epic run. facebook has faster growth than just about any other capitalization companies on earth. so they deserve to trade higher. amazon, think about that interview last night where we talked about the tremendous demand from distribution amazon e-commerce places. that's the strongest part of the economy mp how can you not own amazon? for netflix, stock still living off the last great quarter. how about alpha bet?
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here is another stock selling 20 times next year's earnings. hard to find an industrial that cheap. don't even get me started on the ref repay tree asian issuasian issu. why and they are going to break out the self-driving business. good use of alpha bet's structure but not just fang. the semi conductors. disk drives. you see that. they are sore muching hot. and guess what else is moving? ho holy cow. apple. i've been waiting for a run, waiting for someone else to come out of the wood work and make the case for 2017. sure enough, right on schedule, citibank sites five reasons to own the stock. one, super 8 super cycle. form fact fort phone including wireless charging.
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loot more memory. tax reform giving apple earnings. a lot of that money will go overseas. sticky base to help grow the service stream. apple could ramp up in mobile gaming. you know how much we like the service. four, exciting partners including and ia. five, stock is as big as the jeep. doesn't hurt the wireless ear buds are finally shipping. sock up 1.7%, three bucks from the break out. but not even just testimony. we got lift in biotech. now leading the way, what the heck is happening here? what triggers this kind of move? not like this is some kind of totally random and unpredictable phenomena. no. these stocks go up when inflation is tame. what tames inflation? rate hikes. like the one the fed is almost
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certain to give us tomorrow. buyers grab to the companies that keep staler numbers even with interest rates higher. either apple nor amazon nor selji nor gilliad will see a quarter point increase. >> apple may benefit because it can get a better return from his gigantic hortd de of cash. these are taking off exactly like the way you would expect. it is the play book, people. it gets dusted off every time you play the titans. this time is no different. only thing that can take them off their stride is tomorrow's summit with president-elect trump and the chief tans of the technology industry. i wouldn't sure which way this meeting could go. perhaps -- but bill gates just softened it by saying trump could lead through innovation. wow, that was from left field. who knows, maybe these become trump stocks tomorrow.
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exchanges need happy. this rotation into tech wouldn't be out the denumber of corporate taxes and repay tree asian. of course this market is a beast. and no one seems to know how to feed the best lake soon to be treds trump. yet, pointing gary cone. i urge you to go to google, google this guy. watch some of thighs tape from a bloomberg interview, world economic. cohen is smart guy who understands the neck no loblg cal deflation. it's a bill yant sophisticated. wicked sense of humor, by the way. fabulous break from the ivy tower economist types that have held that position and wall street shared his appointment. you can tell investors like this morning's pick for secretary of state. i know the person that presented
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this went too far when they even the old line republicans. enough big weeks to step up and ep dors it. might be difficult for the senate to hold this up. even if there are business ties to russia. look, love him or hate him, trump ran on the platform of shaking things up. this represents a huge departure for the state department. hard right pro business deal maker who is used to operating in controversial places. this stacks of something trump might have talked about. i know some people view the tilt toward russia as a negative but while vladimir puton is a real bad guy, the truth is, they have deals with real bad guys, as long as it serves the u.s. interest. maybe this is one of those opportunities like when kissinger went to china. and whatever your personal viewis, stock market loves the pick because it is good for business overseas.s, stock mark
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pick because it is good for business overseas. trump's choice of governor rick perry to run the energy department. perry is not some academic, he is on the board of energy transfer partner and gas mlp. okay, bad for the environment sure but yeah -- here is bottom line, today's rally is powered by stocks left behind so far and by more trump appointees that wall street loves. in short the market continues to thrive on the johnny mercer play book. accentuating the positive, eliminating negatives. latching on to the affirmative and never messes with in between. mat in pennsylvania. matt some. >> boo-yah, jim. >> boo-yah, that. >> phone shl tax cuts in 2017. more discretionary income with the cost of oil rising, what going on with these airlines? >> airlines are good because
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their numbers were great. jetblue's number is really good. i also feel that, remember, we had gary keller from southwest, he thought the november numbers were good. i like all the airlines frankly. i've been saying that for some time. may, to phil in my home state of new jersey. phil? >> boo-yah, cramer. happy holidays to you. >> same. >> questions for you, making an offer to buy reynolds american for $56.50, reynolds came back and said we got to think about it and get back to you. what do you think the -- >> yeah, i do. tobacco's got a split market. it will go through. but i don't prefer any of these. i don't think we should have those on this show. we should look for good greenfield ideas. corey. >> thanks for having me on the show. i wanted to talk about the new
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astro zen ka pe athey are talkig about. they are very interesting outlook in 202 mu6 from their pipeline. their partnership with fiber general. which i think could be the next pcyc. what do you think of the long-term as well as partner -- >> i think it is b-a-d. i think they've got very little growth, doesn't have a good dividend. i think there are many, many others that are much better. let me throw one that everybody hates. universally hated, despise stock in the universe. allergen. ken in florida, ken? >> hi, jen. ken kuling from florida. good to be on your show. >> good to have you. >> thank you. i'm interested in the growing virtual reality sector. is there a way to invest in the industry or should i go with an
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individual company like sony. >> i think if you go with virtual reality, you go to facebook. mark zuckerberg, i have listened to conference calls, and he is a real bright fella. i think facebook is the way it play. lasted for a day. today's was powered by stocks left behind. it is not random. this market is in beast mode. "mad money" tonight with christmas less than two weeks away, i i'm going off. mary and bright into the new year. then might be time to grab your fan el and ally mcbeal dvds. this stock is going 90s on you. and what is happening with the d diebold? >> i suggest you stick with cramer.
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>> don't miss a second of "mad money." foll follow @jimcramer on twitter. have a question, #madtweets. e-mail at "mad money"@cnbc.com. or call. that's "mad money"@cnbc.com. mon. .
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ever since the election of the whole retail co-hoerhorts so have been turned on a dime. >> trump stock. >> retails stocks caught fire. it is not just retail in general. this most recent move includes the most puzzling confusing and down right frustrating segment that there is in retail. and teen retailers, who knows what button to push. >> now historically i've not liked these, not one bit, not no how. i think teenagers are incredibly fickled customers. it is a truism that adults don't
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understand teens. even adults who run the teen-oriented power companies or analyze their stocks when you you buy shares, and generally speaking, that's a mug ska. if you want it mato make guess about disrespectful young people then i recommend having children just as fraud as the power of retailers but more rewarding because they grow up. the retailers on the other hand are stuck in a permanent state of arrest and development. got have some jokes, this is a stock show. the demographic is harder to please and that makes stocks risky. we are constantly getting calls with lightning rounds and my usual answer is too difficult to gain. i know that many of you can't resist this group. gu to the mall and especially since some have been on fire lately bouncing back from the
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wap ol wall oping last year. to give you more insight sight with the help of bob lang as well as being a brilliant technique in the three-man all-star team by the fun newsletter trifecta stocks. lang says that some stocks have absolutely gorgeous stocks. oh man. this is just unknown territory for me. there is one that you actually like and you are on your own. let's go to the hottest stocks and teen retail space and first let's check out the weekly chart of zoomies. zumz. you would probably find me with david favor, always trying to face things out there. zumiez has been higher for the last seven months and they are testing the ceiling of the 200-week moving average. that's one we haven't used. usually 2200-week moving average. that's for the first time in nearly a year and a half from last december through this past
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june zumiez made the classic double bottom and since then it is nearly doubled. the stock has been making a pattern of higher highs and higher lows and technicians love that. exactly the kind of thing they like to see. and is currently about a buck away from its 52-week high. more important is the money flow. cmf oscillator. and that the level of buying and selling, trending higher for months. currently in very positive territory. suggesting big intugsal moninst money managers. and there is earning speed a couple weeks ago. and we love to see that. zumiez is the teen retailer i find way too risky. but the lang. next up, how about tillies? another teen retailer that exploded high two weeks ago in the wake of much better than expected quarter.
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becoming very popular on wall street's fashion show and may have additional anecdotal insight on this one because his daughter works there. after surging higher in august the stock spent the next few months consolidatingity gains, look at it break out, will you? before spiking yet again after the earning report. and not only is the stock rallying harder the last two weeks but made this move incredibly strong volumes. you see this volume there. look at that. look that spike. you know what, that confirms it is scrambling to own tillies. on top of that, seeing amazing signs of institutional buying looking at the money flow oscillator. look at this. it keeps climbing. this is 14 bucks and change. lang thinks tillies can take out its high eats 17. that could be a terrific buying opportunity. to me, tillies, i don't know, come upon we missed it. i don't like the chase. particularly when we are dealing with a group that historically has been quite treacherous. the next red-hot teen retailer check out the weekly chart of
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francescas. fran. selling jewelry and accessories for young women. i talked about it on squawk of the street, it was so good. as a powerful chart here, fran says ka cut through the ceiling of the moving average like a hot knife through butter. pretty good. and this major move is on stronger vibe answers there is a nice spike versus where it has been plus relative strength index at the top and important momentum indicator steadily rising. that's a beautiful rsi. and as for the money flow, you know bob likes that and went from negative to positive in september continuing to get stronger and yes, the large guys are coming in plain and simple. he wouldn't be surprised if it is getting ready. he thinks the $21 stock can go to 30. that's where it can go. seems like a stretch but i feel like you're chasing and consumers are way too fickle for
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me to recommend it up here but it did report the same sales. so is there any teen oriented retaf retailer of the strong chart that i'm willing to bless? i want to you gander at the one that is 5 below. it is a company, not a mountaineering company like k2 and north face and stuff. it is a fabulous chain where everything is 5 bucks or less. 5 below is not the favorite in the group but he thinks it's got great potential. we like that. and it's been trading at a tighter range and tighter range and tighter range to the point of the triangle and in these situations you get a break out or break down. langley is a breakout that is more likely since the $42 stock has a flow of 41 plus moving average and what we call the mac d indicator. helping to prediction changes. it is predictive in the stock and made a bullish cross over very small and hard to see.
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this is a rely able indicator. and breaking down above the ceiling of resistance at 44, he believes it could be upside but if it breaks down below 41 he says all bets are off. me, though, i think 5 below is an excellent regional to national growth retail story with the terrific business model. this is less about gain wlag teens want and more about the fact that people love bargains. i see the concept as the logical extension of the dollar store and there is a ton of runway. which is why i would be a buyer here. i would love to buy into weakness. they thought ways a real sport. you know. like a sport. here is the bottom line. many of the teen retailers have been rocking it higher and even though i'm very weary of the stock i think you deserve to know what charts say and the
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chart by bob long suggest that zumiez, tillies and francescas have more room to run while there could be potential if it jumps the right way. 5 below is the one i'm willing to bless based on the fundamentals. what the company's numbers are is a bargain based regional national retailer. while others, too fattish for me but maybe you can get comfortable. stick with cramer. >> coming up, as the dow approaches a new milestone, how can you make money off the index? >> the dow is closing in on 20,000. >> march to dow 20,000 continues as you're watching the market approach 20,000. >> cramer's got an idea of how to play the rally. and there is something to do with big blue. find out when "mad money" returns.
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ibm stock hasn't done anything. as we approach dow 20,000 that's what happened behind the scenes in training throughout the country. mad scramble to get something to buy a big capitalization stock especially the one with the dow. i know this because i lived it. this environment is reminding me of the great bull market of your. and i can clearly call my youth. one would study the tape, look for stocks to buy that were behind both the peers in the market, betting that they too could start climbing. someone once in motion tends to stay in motion. i want to be clear, when i was running my hedge fund we didn't buy stocks for the reason they didn't do any yet. we did search and find out it could be a catalyst and a catalyst driven firm and certain analyst meetings are better than others or the market would fall in stocks and we like to think that there could be good news coming, sometimes simply in the
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form of upgrades or earnings. analysts take queue from t analys analysts take their cue from the stocks. i know the 20,000 dow shouldn't matter. it is stip top of mine and any money manager knows it'll make the front page of the papers and your investors will see it and wonder what heck were you doing if you didn't own any obviously winning dow stock. case in point, ibm. here is a stock that's been lagging in the broader market even at 52-week high. but almost four years ago ibm was 50 point higher than it is now. so you know it's got room to go before it bumps in any old ceiling. company has a huge buy back with 500 million shares in the last decade, bringing the share countdown from 1.4 billion to 957 million. very little credit for that. 3.3% yield. stock sells at three times earnings. they are becoming much more after play. fast-growing cognitive
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artificial intelligence business and if trump's lower tax rate and terrific play on stronger economy and ibm has the bagging of warren buffett. one second while i take 100,000 ibm. now newer hedge fund managers and analysts aren't used to this kind of behavior. they don't get the concept of buying a stock behind the market. they only think of how ibm repeatedly disappointed. i would come back and say if you think growth will accelerate both here and in the rest of the world then you have to believe a company like ibm will see a median improvement in what has been lack. that will quickly fall to the bottom line given the company is considering the cost they've cut. add it to the positives, it is unlikely ibm will announce or upset the long side apple cart. 15 of 26 analyst have a hold on the stock, 4 outright sell. there could be a lot of people upgrading. yes you have to think that way thp pe will hire 25,000 people
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in the u.s. something ceo will no doubt talk about when she meet with president-elect trump at tomorrow's tech summit. finally, when money managers are casting out for exposure they can quickly put ibm on. it is liquid and any broker can stomp you out. that means they sewill tell you few pennies. we haven't seen this activity since the 19 the90s. it is old school. it is real. it has been everyday since the company began. and ibm will be the big beneficiaries. joe in my home state of new jersey. joe? >> caller: jim, an early christmas boo-yah from the garden state. >> can't beat that, christmas boo-yah from the garden state. >> caller: now time to buy some of the beaten down domestic producers specifically my stock is wider petroleum, wll.
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>> okay, whiting, we can look at whiting two ways. we can look at it from the way it was, much, much higher because it was a takeover candidate or where it was a few weeks ago which was 77. i think this stock had a big move off 9 to 11 basis. i would rather see you buy it at a 10 on pull back. i've been advising get a little lower then pull the trigger on these oils. >> caller: hey, there cramer. >> yes. >> caller: thank you for your thoughts on the r donnelly spin-off in october. i have yet to sell any of the three companies and with two months under our belt we know lsc corporation has 4% yield but still main line trader in digital world. asset-light. good motherin possess. return on equity of nearly 30%. and rr donnelly you notice in october dirt cheap but the best groer of the three. >> absolutely.
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>> caller: here is my question. i have a handsome loss on all three. with the long-term, buying homework horizonon line, should i buy two and have the third -- >> no, hold them. i think a lot of people threw these out because they didn't know what they owned. i think they are worth much more than the hull. at the last day of the year with tax selling bo going through to pick more up. i expect to see -- i expect to see last acquisition answers will grow those companies. this bull market remind me of my youth. getting in on stocks that look like laggers to the naked eye. it is real and could work even if you think that's fanciful. much more "mad money" ahead. amazon go lets customers shop without waiting in the line. there is self-scanning technology. do not miss my exclusive with the ceo, diebold nix dorve.
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uber's stock is up nearly 30% but with the space struggling, should you lease a space? digital realty trust? and for your calls, rapid fire in tonight's edition of the lightning round. stick with cramer. tomorrow, kick off the training day with squawk on the street. live from post 9 at nyse. >> don't you think they have to have a cabinet meeting there? get mark burr net to do a cabinet meeting. >> it all start at 9:00 a.m. eastern. net to do a cabinet meeting. >> it all start at 9:00 a.m. eastern.
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when a bank starts making a lot more money, and they make more off your deposits and i bet banks use that money to buy new atms and better software to fend off competition. if that's the case this is a good time to check in with
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diebold, biggest services of atms in the united states. and the physical security business and new business selling software at banks and more important perhaps retailers courtesy of their nixdonk that closed over summer. diebold is down 20% near to date. it gave pretty conservative guidance. this is a company that been trying to turn itself around. cutting costs aggressively and some of the largest customers are about to get a major boost. is this a stock worth buying? let's check in with diebold nixdor. welcome back to "mad money." take a seat. i don't know where to begin because i like so much of what you are talking about with the backlog and retailer p. but tell our viewers it's been a little rocky since the merger. you did say product reset but that seems behind you. how are thing going right now? >> things are going well. >> we just did the biggest
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transformational deal in the 157-year history of our company. we acquired the company pretty much the same size as ours and had our addressive market by 50% and merged two big organizations. so to be sure, q3 was a little on the lighter side as much you as prepare for it people do want to know who they are working for or customers want to get reinsured. but after we're through with that, everybody is lined up, i've talked to customers in the last weeks and there is a lot of excitement and remoent um building in the company. >> last night there was an important reorganization italy with a very big bank. i know have you european bank, you say are our drivers. is that good for diebold nixdorf. >> that's very good. there are four main driver in the industry.
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digitalization, individualization, targeting a market of one. it is automation and miniaturization. we play on all four of those trends and different theaters of operation have different drivers. europe is a great automation driver at the moment. >> talk to me about this omne channel eastern european retail. that seems like it is the store of the future. >> it is the complete total store management. we do everything for the store. everything that basically has a plug that is managed by diebold nixdor. we do self-checkout. recognition when you walk into a store. it is a great opportunity to do tomorrow's shopping and can you experience it and we provide the experience around it. >> amazon is coming out saying when you bring your cell phone you don't have to have a checker. you are already there. >> we are there and showcased that at 20/20 in vegas a few weeks ago and not only can you check out through your phone you can do your shopping list on
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your cell phone, go into the store, and the store will rearrange your shopping list to minimize the walkways that you have to do in a store so you can optimize your shopping time. >> so you will be a competitor at amazon with this. >> retail is the next innovation market. it is a big drive earn amazon is clearly the 800-pound gorilla. but we're there with them. as they talk about the delivering groceries, to the end user, they are setting up kind of like digital refrigerator boxes and that's another opportunity for us to provide automation to the industry. >> okay. now there are were people who did like it for the dividend and you had to change because you've changed your balance sheet and you've got more debt on, although less than i thought you would at this point. do you start building back in dividend or is it better to just consider it a growth stock that
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is really just about trying to give you capital and not necessarily the income. >> well we had to do with the prudent thing. the company up nearly four times, we are currently closer ton three an to four and paying down $2 00 million and our first priority is to pay down debt and be below 3 x leverage. after that, we have all the options on cash users going forward. >> the competition ncr, some people feel was able to take advantage of a glitch that you guys had just in terms of your -- of the combination. are you taking back share from ncr or just share that's been lost. >> if you take a look at the fwloeb al market shares, being very little movement between the two, where the market on the americas, head to head with ncr, europe and most countries number one and we're both fighting in asia against a local asian competition. >> china head winds where we now get better or is it a tough
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moment. >> a very tough moment. but only western player that did local drawing ventures so we're back at the starting line to reenter the market and have a shot at what still is the biggest groaning market in our industry. >> one of the things, you mentioned the store of the future. what is your thinking about automation versus people. we have a new president coming in. we are talking about saving jobs but in last ways wh i think of that store of the future it doesn't need as many employees. if you use the human element for what it is meant for which is consulting, advice, services. not repetitive administrative tasks. there's roughly 3.5 million cash eers in this country. >> 3.5 million? >> 3.5 million. just imagine if there were 3.5 million advisers. how much their revenue would grow and we help transfer fem from repetitive tasks to
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advisers. >> this is president and ceo of diebold nixdorf. "mad money" is back after the break. why pause a spontaneous moment? cialis for daily use treats ed and the urinary symptoms of bph. tell your doctor about your medicines, and ask if your heart is healthy enough for sex. do not take cialis if you take nitrates for chest pain, or adempasĀ® for pulmonary hypertension, as this may cause an unsafe drop in blood pressure. do not drinklcohol in excess. to avoid long-term injury, get medical help right away for an erection lasting more than four hours. if you have a sudden decrease or loss of hearing or vision, or an allergic reaction, stop taking cialis and get medical help right away. ask your doctor about cialis.
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it is time, time for lightning round. are you ready? lightning round, starting with dario in washington, d.c. dario? ? >> caller: boo-yah, cramer. how you doing? >> all right. how but? >> caller: all right, all right. i'm interested in putting in a position of -- >> i feel like train is has left the station. say, i'm going to catch the next one. to joe in jersey. joe? >> caller: cramer. what would i do without you. thanks for all that you do for us. >> thank you. >> caller: my stock is national bank, they will issue a -- >> a local bank. not done going hard.
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a manager at my kings works there too and he's terrific. gives me that chicken. to dennis in michigan. dennis? >> caller: hi, jim. 6% dividend. mgm property in las vegas, m kb p, down it% in the last month. is it a buy? >> you bet it is a buy. come on in and reassure the stock is down 28. bingo. great numbers in that national harbor. couldn't get in until sunday. checked the web side. thank you. show me you couldn't get in. like a capacity issue. >> caller: is barclayes a buy at this level? >> what do i care in just kidding. just kidding. i think barclays is a managed
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stock. throw in credit suiss and deutsche bank should pay regulars might be an opportunity too. wow, that's a departure. okay, matt in new york. >> caller: hey, matt in new york. long time fan, long-time listener. alk -- >> oh man. that is the best in the airline stocks. i'm not kidding. that's in terms of momentum. now you know when it comes to the airlines, i prefer to play more conservative with southwest but alaska has a great growth profile and they did that deal. to janet in south carolina. janet? >> caller: thank you for having me on and boo-yah from south carolina. my question is about vpo. i'm wondering if you think the stock is -- >> if we're going there, buy the real deal. i need jack in pennsylvania. jack? >> caller: jack from stiller country. i want to know whether to hold
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mbr or sell it. >> i like mbr and i like the steelers. someone ripped me off in the fantasy league but defense is good too. to andy in california. andy? >> caller: hey, jim. big happy holidays boo-yah. how you doing? >> nice, nice, good. how about you? thank you. >> caller: excellent, thank you. pharma, bye, sell or hold? >> too risky for this guy. we have high quality companies really down. this just spiked. up 100%. i think we missed that train. missed two trains. to mark in florida. mark? >> caller: boo-yah. long-time listener. been with you since kudlow and cramer. >> that is ages ago. call she is 20 years old, going to call edge.
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shout out to valencia college in orlando, florida. a three-month free-fall since -- >> we think that there could be, what we are looking for is an expiration. maybe they come up but there is 40% short which makes me concern. long-term, i like it very much. it is the backbone of sho muo mf the internet. last one, mike in kentucky. must be lucky. mike? >> caller: thanks for taking my call. shareholder with energy partnership. >> that's kelsey warren. too much after deal make he for me. zw that at 12%. hey, that's probably good for the lightning companies. that's it for the lightning round. >> the lightning round is sponsored by td ameritrade. what's with the dog-sized horse? i'm crazy stressed trying to figure out this complex trade so i brought in my comfort pony, warren, to help me deal. isn't that right warren?
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well, you could get support from thinkorswim's in-app chat. it lets you chat and share your screen directly with a live person right from the app, so you don't need a comfort pony. oh, so what about my motivational meerkat? in-app chat on thinkorswim. only at td ameritrade. what's critical thinking like? a basketball costs $14. what's team spirit worth? (cheers) what's it worth to talk to your mom? what's the value of a walk in the woods? the value of capital is to create, not just wealth, but things that matter. morgan stanley
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sporting morgan stanley with the trust cohort because this bond market alternative stocks could get a lot less attractive than the federal reserve raises interest rate tomorrow. something everybody is expecting. and commending a few places to hide this environment and some could work better with higher rates. doesn't matter. i'm talking about the data center reads. that's what they singled out. these are the fastest growing reads out there and building real estate under them is a good
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one. this is it. the in the last six months it's been difficult which brings me to digital trust, dlr. a company that owns and manages 156 data centers and four different continent and there aren't enough data centers out there to meet the demand from businesses that want to he is secure places from digital information particularly now that everyone is embracing the cloud. whenever you hear that some piece of software is in the cloud and that is in the data center and that's among the reasons why they've been buying up property hand over fist. and in the position of a eight european data centers over the summer plus a growth reporting a robust quarter end of october 25% growth. that's how strong this data center business really is. of course digital release sport 6% yield and a rate hike however the stock's been holding up better than the rest of the sector and may be down 14% from
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highs in july but up 30% year to date and rallying hard. a new name for us, bill stein, ceo of digital trust learning more about the company and welcome to "mad money." good to see you, sir. >> thanks. >> thanks for having us on. >> bill there is a chart i have. total return since digital ipo. up from 10/28/2004. you have a return of 1,223.8%. why are you doing so much better than every single read that i follow. >> great question, jim. it's really because of the demand drivers for our business. so at present time, roughly 3. cloud is obviously a huge driver of business. social networking from many years ago has been pushing it up as well as content. but looking ahead, i think there's a tsunami of data coming our way to further drive our business. >> and the demand is still strips the supply, even though the supply is robust, right? >> absolutely. demand is ahead of supply and if you look at what the going to
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drive the data growth of the future you have the internet of things which is cisco's estimating 50 billion devices by 2020, driverless cars, a huge amount of data. >> driveless cars would use the da data center and how does that work where you fit in something like that. google announcing it will spin and spin off its driveless car division. it is in the news. >> right. uber obviously is very active in that and they've -- they are basing their driverless business in pittsburgh using carnaghi melons former professors. and you know, they are actually very good customer bars. if you think about the radar, sonar and mapping and all that, there are estimates that a driverless car uses in eight hours uses 3,000 times the amount of data that a person uses in a single day. >> therefore we need many more
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digital farms, so to speak. >> you need a lot more data centers to support driverless cars. >> why would i, if i were your facebook, linkedin, jpmorgan, why wouldn't i have my own buildings? >> well, you may well have both. it is a hybrid portfolio approach. but the advantage of using a company like digital is first of all time to market. if a company such as one of the ones you've mentioned want to do it on their own they have to find the land which makes time. entitle the land with the local authority. and they have to find power for the data centers. they may well have to run fiber to the site and they build a data center. that could be upward of four years. we have an entitled site with frequently a shell and if we have the shell we can put somebody in business basically in 90 to 120 days. >> is there not enough space for you to do the form you need? you are fitting one in chicago.
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have you one if california. i'm trying to get a sense, you need a lot of space. >> we need a lot of space. but we have secure our supply clan. we' chain /* chain. we bought a lot of land in chicago and dallas and a supply clan in part of the world like asia we build up. we have to build vertical because land is scarce. >> i think you are a great growth story. you've been much stronger. . i agree with morgan stanley. bill stein, ceo of digital realty. this is the first time for mr. stein. "mad money" is back after the break.
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we have a big event going on tomorrow, in case you haven't heard. the federal reserve will call its deal. this is what happens to all kind of things like mortgages. tomorrow morning i will be live on facebook at 2 oblg tomorrow. there is always a bull market somewhere. i promise to find it just for
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you. i'm jim cramer. see you tomorrow. tilman fertitta: tonight on "billion dollar buyer"... the name of the game is to stay in business. tilman: .i'm bringing my buying wer to the big easy where i'll push two small businesses to make some hard decisions. you are going out of business if you don't move art. a cosmetic maker who needs to let go her caution and start taking risks. i don't see this company growing until you do something. a cutting edge sculptor who needs to let go his pride and start making sales. if i sell this for that much, that's a death sentence forever. you are wrong. you are wrong. tilman: if they take the leap, i'll lift them to new heights... there is no comparison, i guess i have to kiss it. ...but if they can't get it done... i would be scared to do business with you. ...they might as well call it a day. you are screwed up.

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