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tv   Mad Money  NBC  April 17, 2012 3:00am-4:00am EDT

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shoes. for spring and summer. >> yes, yes. >> thank you so much. have an awesome monday fun day everything. we'll see you tomorrow. i'm jim cramer, and welcome to my world. >> you need to get in the game! it's going to go out of business and he's nuts! they're nuts! they know nothing. i always like to say there's a bull market somewhere. "mad money." you can't afford to miss it. hey, i'm cramer. welcome to "mad money." welcome to cramerica. other people want to make friends. i'm trying to make you a little money. my job is not just to entertain but educate and coach you. call me. what got into the stock market today? dow soaring 72 points while the s&p and the nasdaq couldn't keep up? i'll tell you what got into the market. stocks in the dow jones average mostly big international companies which had massively underperformed the nasdaq, finally broke free from europe
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for a session after being tethered to the hideous action across the atlantic for the whole month of april. in fact, many stocks that have been held hostage by europe took off today. even as the stocks that seemed to be immune from the european contagion got walloped, including many of the nasdaq's biggest stars like apple and google, down an astounding $25 and $18 respectively. all right. fist let's set the table. we have a ton of bogus linkages in this market right now, linkages that have little to no basis in reality but cannot be dismissed or ignored because they play out every single day whether we think it's right or not. as long as europe was strong as it had been for much of the first quarter and certainly for the latter part of the fourth quarter, the dow and the s&p were free to roam higher and they traded pretty much in sync.
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but after last week's miserable action, we've now recorded five straight weeks of sickening european declines. after a sell-off that long, you begin to believe that europe can't have a rally and it will take down our international companies with it because they do business in europe. the impact becomes unavoidable. it's so relentless that people get complacent, complacent about the downside. [ screams ] i woke up this morning, something incredible happened between 4:00 and 5:00. europe looked flat to slightly up and then got a little stronger. talk about unexpected. last friday our markets sold off furiously, particularly in that final hour. remember the last 40 minutes? word spread that we were going to have some horrible news out of europe over the weekend. now, we had been rallying all afternoon after a very rough opening but the dow doubled its loss in those last 40 minutes. it made us feel like our good fortunes for 2012 had finally reached an impasse. we had two good days last week, but they were book ended by troubling sell-offs. and that left us writhing that we had to beat those who sell in may and go away. if only there were a word that
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rhymed with april. that would rival may's poetry. what were we so afraid of? further collapse, maybe in spain? a sneering comment out with germany against the lesser-offed hinterlands renewing woes in the italian bond market? that always does it, doesn't it? let me ask you something. does it really matter? i mean, only stephen king could come up with more horror show twists and turns. remember that lincoln tunnel scene in "the stand"? even more important, the dollar, which had been getting stronger versus the euro, reversed course this morning. i saw it before my eyes. i was shocked. it was a happy surprise. so when the markets in europe didn't sell off and euro rallied, all those people dumping the stocks of big international companies based here because of their tie-ins with europe and the euro, they got caught flat-footed. they got caught on the wrong side of the train. see, they had gotten complacent about how bad europe is.
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and who can blame them? if you know, for example, european banks are the epicenter of the downturn, then why not bet against our banks? yeah, should a minneapolis-based bank trade with spain? well, it does. a trade that has worked tends to keep working until people get their heads handed to them. there's an adage for you. if you know big consumer product companies are about to report starting with j&j tomorrow and you know the euro has been weak, you're able to short stocks with impunity. that's what people have been doing. but the failure, the failure of europe to decline this morning and the rebound of the euro set up a chain reaction where the money managers who have been leaning against our financial center consumer package goods, they got their bell rung! [ bell ] less cowbell. every time i talk about this kind of linked trading, people
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react with genuine disbelief. the average guy, you're at the ball game, you talk about europe, they're like, europe, what are you kidding me? i live in philadelphia. how could a day where europe failed to go down really impact our stocks? how could the euro rallying really matter this much? isn't it ridiculous? no. no, it's not. hard as it may be to believe, this is the modus operandi of hedge fund operators worldwide who manage hundreds of billions of dollars. the change in europe ignited panic among the big boys who have been coasting with these weak european stock trends all exacerbated by the fact that many of the companies due to report this week need a weaker dollar to get a positive outlook. and suddenly they might have one? that's how underperformers like proctor, 3m and j&j -- i mean, j&j, how many bad things can happen? the stock goes up. what does that tell you? these are quintessential weak-dollar stocks and we have a weaker dollar. with no bank run rumors out of europe, we were able to mount a solid bank stock rally led by citigroup with a good quarter. banks couldn't muster more of a move simply because we have a
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huge spanish ten year bond auction coming up thursday. so many people are betting that's got to go poorly, which would cause the banks to have another late down. but the consumer product stories couldn't have been stronger. the problem is this market doesn't have enough money to spread the wealth. when we get money in colgate, merck, pfizer, that has to come from somewhere. today it came from google and apple. how about this? a week ago these two stocks were in a footrace to $1,000. now they appear to be in a contest to see which can fall to $500 first. apple on the inside track having fallen pretty much in a straight line from $637 to $580. what's incredible to me about this apple decline is it seems to have been caused by google, even though their biggest point of commonality happens to be their high stock prices. google, if you recall, actually beat the estimates but missed on the key metric of profitability, issuing this nonvoting stock dividend, makes you feel like they're about to overpay dramatically. keep pace on facebook. apple. all right.
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let's go over this. because that's all anybody's asking me on twitter. i heard a lot of fretting about how the big telco carriers aren't willing to continue the big subsidies they paid to sell a lot of iphones. i heard about the iphone glut. these are tried and true takedown rumors that people spread when they want apple lower, and there's a lot of people who need apple lower. but you raised a ton of cash if you sold apple, something that helps until tomorrow filing your taxes. given that we saw tons of selling in a host of winners like winn, fossil, starbucks michael kors,, maybe a tax-motivated thesis makes sense here. others might have sold thinking if google could cascade so easily so could apple. if google shifts 48 points in 24 hours, who knows how much apple could go down? when you consider apple hasn't had a noticeable pullback in ages, it's easy to see why those who piled in into the stock last week would flee this name. i'm sure many people who sold
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apple today did so because they saw others selling it. such is the case with all momentum investing. we ended up with what amounted to a front seat to back seat day where all the last month's winners, those unaffected by the weak european stock market got pummeled. while the losers that have can be risk-free shorts because of an unexpected european decline put on a rally. to me it's a countertrend rally that will run its course. in the interim, this move will finally let you buy the growth stocks i've been highlighting and they'll be at a discount. of course i know the way it works. it's a discount nobody wants. particularly the price cut in apple, because people prefer instant validation that they're right. sorry. in the real world, stocks rarely validate over the short term, even as they reflect real earnings over longer periods of time, which is why it's right to begin to buy these newly downtrodden while taking profits, ringing the register in many of the stocks that gave you nice gains today.
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i want to go to jeff in texas, please. jeff. >> caller: hey. professor cramer. >> what's shaking? >> caller: hee haw boo-yah. >> nice. >> caller: i was wondering about tyson foods. since the pink slime issue has been resolved, has the stock been beaten up enough to buy now? >> you know what, i'm going to say no to that. i am going to say that in the end, because we have this ethanol policy where we use a lot of corn to be able to make gasoline, the feed cost for tyson is just not going down. we need to see corn plummet. we need to see a change in what's made -- what makes ethanol. and i don't see that coming. i'm calling today's action an about-face. europe's news drove the dow which had been radically underperforming the nasdaq in a different direction while the nasdaq plummeted. i have to tell you, i think this is a minor chord, not a major chord day. i want to buy the growth stocks as they're pummeled. mad money right back. >> coming up, a new shade of green? cramer's kicking off earth week with a pair of ceos that are
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helping you clean up by cleaning up our act. first up, natural gas is abundant, cheaper and cleaner than oil. could clean energy's gas stations of the future help fuel up your portfolio? and later, sporting goods smackdown. cramer's hunting for a play in retail. and tonight he's taking aim at two contenders. stick around. every day, an average of 5,000 people
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it's earth week here at nbc, in anticipation of earth day this weekend. i got to tell you, for most of my career as money manager and market commentator, the idea of green investing is called an oxymoron. five years ago i would have said you can either help the environment or help your bottom line. but you can't do both. because destroying the atmosphere is a lot more profitable than trying to save it.
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i would have told you if you're worried about the planet, invest in the dirtiest companies imaginable and donate your profits to the sierra club. now i have a different attitude. not because i've become more environmentally conscious. my view has always been when you're investing leave your politics at the door since they only get in the way of making money. that hasn't changed. something even more remarkable has happened. we've reached a bizarre, unprecedented moment where at least one kind of green investing pays off, where the right thing to do environmentally also happens to be the best way for businesses to save money. i'm talking, of course, about the incredible potential of natural gas as a fuel for surface vehicles. we know nat gas is better for the environment, producing fewer carbon emissions than diesel fuel, and thanks to the huge domestic natural gas finds in recent years, the price of the commodity is so low that if you're driving a truck switching to natural gas should be a no brainer from the financial perspective since it's so much cheaper than diesel.
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enter cramer fave nat gas spec clean energy fuel, clne. natural gas fueling stations all over the country and is building a nat gas superhighway all over the continent. they have their finger on the pulse of the nat gas revolution, despite washington announcing hertz will offer rental cars run on natural gas. stock down $1.02 or 5.1% dude, but it's still up 61% since we spoke to the ceo as part of last year's environmental celebrations on november 14th. potential could be huge as companies realize switching to cleaner, cheaper fuel offers the prospect for american energy independence. let's check in with the terrific co-founder and ceo of clean energy fuels. welcome back on "mad money." >> good to be here on earth week with you. >> looks like you got a little present for congress tomorrow when they come back, don't you? >> well, we're going to run a little ad for them welcoming
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them back to town and remind them that they passed on an opportunity to put in place an incentive to use america's clean domestic fuel. and i think the ad you're referring to shows a station we operate in chicago. it's $2.14 cheaper to run on cng than it is on gasoline and about the same on diesel. >> now, one of the things we've learned, andrew, is that the nat gas industry has not been a great spokesman for itself. is this the first real offensive act that you guys have taken? >> well, you know, we've worked at it for a while, jim. and let me say, and i think you and i have talked about this before, i don't know that we have to have congress. i mean, the economics now are so strong, but, you know, we are passing up as a country an opportunity to harness our great natural gas resources, and in fact, you know, the bill that failed in congress a while back actually had a pay-for associated with it so it wouldn't cost the american taxpayer a penny.
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i think it's something we should continue to push on because it would help these trucking companies move to this fuel and realize the savings and for a country, we'd be better off. >> i don't know if you looked at the automobile section in yesterday's "new york times." >> i didn't. >> there's a "how green are our electric cars?" depends on where you plug in. it's basically saying that, look, you're plugging into a coal-based system, so in the end maybe electric cars aren't as clean as natural gas cars. >> well, right. and, jim, i'm not going to run down my friends in the electric car industry, but we all know that the natural gas honda that's produced here in the united states is cleaner. it's the cleanest car available. and i think "the new york times" also ran a story that said, well, what's the payback on these electric vehicles? and of course a natural gas vehicle pays back a lot faster as well. so we have -- it's fitting that i'm here on earth week because, you know, we're 25% to 26% cleaner and we're cleaner than the electric vehicles, as well, with natural gas. >> one thing i found discouraging, there was a
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terrific interview on "squawk box" with fred smith, ceo of fedex, and bob lutz of general motors. and they were tripping all over themselves to say, listen, passenger cars, compressed natural gas, simply doesn't provide the range. now, i mean, the range, if you put up a lot of nat gas stations and if you run natural gas in conjunction with gasoline, is range really an issue? >> i don't think so. you know, in europe, jim, they have bi-fuel vehicles. you're getting 240 -- i drive a natural gas lincoln continental town car and it gets 240 miles of range. for the average driver, that's plenty of range. you put a small pony tank on board and you have plenty of range. but you know what, mr. lutz knows, i think, better. the fact is in america we've never gotten serious about putting natural gas and incorporating it into the frame and under body. in europe, the mercedes-benzes
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and the fiats, they do it and they incorporate it into the vehicle and so you have plenty of range. we haven't done that here. we've always taken the short cut. years ago. we slap a tank in the trunk and that's not the future and doesn't have to be the case. but that's what's happened in detroit up until now. >> now, andrew, you have that terrific ad. but phil lebeau from our network had a piece last week about natural gas. apparently, he says, there are only two nat gas filling stations in all of chicago. that's not a practical fuel. >> well, look, as you know, jim, we started out with fleets. and that's our business. and so talking about passenger vehicles, and i think someday you'll move to that because of the savings. we've got four stations under construction right now. we have two open in chicago. there are some others, actually, that are run by the utility. we're fueling 100 taxicabs today that are all new on natural gas at those two stations. we'll build more, and we're getting ready to build a station at chicago o'hare.
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we have another one there open now. but this will start out with fleets and it mushrooms from there. think about it as a fleet fuel not really ready for the passenger car market but we'll get there eventually i'm sure. >> all right. andrew, what happens if shell decides tomorrow, we're going to put natural gas pumps at all our stations? shell's a big company. wouldn't they put clean energy out of business? >> well, now, remember, i'm going to go back to -- you know, we really focus on the heavy-duty trucks and trash trucks and the fleets, the return-to-base fleets. we're building, as you said, in the interim, the natural gas lng truck stop at system with our pilots at flying j. shell is not in that business. you're right, if we think about it as a passenger car fuel and the 100,000 gasoline stations, that puts our company into a difficult position. but when you look at fleets, you know, trash trucks and 18-wheelers are not pulling in to shell-owned truck stops. >> right.
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>> that's not the way it works. that's where we're focused and our niche. by the way, it's a 25 billion-gallon niche so there's plenty of room for us to expand in that business. >> one last question. the president put together a task force last week about natural gas. you know, it's a fossil fuel. i'm going to ask maybe a naive question, but is a task force good or bad for this guy? >> well, you know, let's give him a little credit. it's taken a while, but we have moved now. you know, there was a long time, jim, and you and i talked about, where the president didn't mention natural gas. he now is talking about it. he's got secretary chu talking about it. you know, leadership is what's important to move this country to a new fuel. and so i'm for it. i'm for a task force to look at helping on natural gas and recognize that it's a great fuel for our country. you know, not only for transportation fuel. it's going to -- it's spawning a renaissance in industry in this country. and so, you know, sure, we need leadership from washington. we need leadership from all over to make sure that all of us as americans realize we've got a
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great resource right here. >> but in the end, andrew, your company does not need washington at this point at all. >> that's right. we don't. jim, when you can save a trucker almost $2 a gallon and they use 20,000 gallons a year and the incremental cost has come way down to $30,000 and you're getting less than a year of payback, economics is a beautiful thing. that's what's going to make this go. that's where we're headed. so, we're keeping our head down. we have 100 of these stations under construction right now. we actually this year will build 170 stations. at the end of this year, coast to coast, border to border, you'll be able to drive a natural gas heavy-duty 18-wheel truck. engines are coming out this year and early 2013. we'll just keep plugging. >> now, do you think that congress would respond more to cleaner air, respond more to the payback, respond more to energy independence, or respond more to the idea that we couldn't create a lot of jobs?
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>> they're all pretty good. you know, what i've -- when i've worked on capitol hill talking to members, the energy security issue seems to really get them. i think maybe that's first. and of course jobs. doing what we're talking about is hundreds of thousands of jobs. so maybe we go there first. but all those are great items for the country. >> all righty, andrew. thank you so much for coming on the show. good to see you. >> thanks a lot. >> thanks for coming on earth week. you have to laugh about it because there are so many good things about it, but we know it's got a lot of opponents. do your homework, make your own judgment. stay with cramer. coming up, sporting goods smackdown. cramer's hunting for a play in retail, and tonight he's taking aim at two contenders. stick around and find out which sporting shop has the goods. and later, fight over fracking. as the president orders a panel to oversee the effects of fracking, clean harbors continues to turn the dirty business of energy production into clean cut profits.
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could rising domestic and international demand continue to fuel its growth? cramer's drilling down with the ceo to find out. all coming up on "mad money." er! hey, i got a leak ! yoo hoo ! wait a minute, come back ! um, miss ? up here! right. like 85% of us, you have hard water stains and that cleaner's not gonna cut it. truth is, you need something powerful. you need lime-a-way. it's 4 times more effective at removing limescale than the leading bathroom cleaner. because lime-a-way is specially formulated to conquer hard water stains. for lime, calcium and rust... lime-a-way is a must. [ female announcer ] been looking for excedrin lately? now for your tough headache pain, turn to the long-lasting strength of aleve. problem solved. ♪
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i've said it before, and
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i'll say it again. this is a stock picker's market. individual companies are once again in control of their own destiny, and that means good, old-fashioned investing is back in style. as long as you can identify high quality companies and buy their stocks at decent prices, you should be able to make money in this market. but how do we know what's high quality? the opportunities are out there. you just have to be able to identify them. take today. this morning we got some very robust retail sales numbers for march, better than expected. does that mean we should load up with some retail etf? no! that's not what we do on "mad money"! why buy the whole sector, the good with the bad, when you can just buy the best? what's the best? lately there's been a lot of handwringing about the death of bricks and mortar retailers, think best buy like nothing more than showrooms for amazon where they can check out the merchandise before buying online. however, there are still some things you can't buy on the internet. you know what that is? i'm talking about things like guns and ammo! all right.
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things are flying through the roof here. just a sec. shoot, man. don't go duck hunting with a pen knife. anyway, stuff is flying off the racks because of more relaxed gun laws and in part because it's an election year and gun aficionados like to exercise their second amendment rights in case laws get more restrictive after november. all great news for the sporting goods stores that actually sell guns, places like dick's cabela's. i liked this space before it was boosted by firearms. recently we've had a lot of good things from nike and under armour. however, in a stock picker's market, you got to pick! i wouldn't be doing my job if i told you dick's and cabela's are terrific so buy either one. you have to determine which one is a superior stock and which is camouflaging as superior. camo as a superior stock.
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tonight we're having a sporting goods face-off. dick's versus cabela's to figure out which is the better buy. first off, dick's and cabela's may be in the same business, okay? maybe. people may think that. but they're very different companies. dick's is the leading big-box sporting goods play, okay? 480 stores, 43 states, 81 golf galaxy stores in 30 states. cabela's, on the other hand, started out as a direct marketing firm, fabulous catalog business so they -- this is my duck hunt call -- so they have only 34 retail stores that are heavily tilted towards selling guns and ammo. 41% of the sales coming from hunting equipment. so how do these two compare? the most important metric for me is growth. where is the growth coming from? dick's plans to nearly double their overall store count to 900 stores. that would be huge. the company is opening 40 new stores this year alone, a nice 8% increase.
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cabela's, on the other hand, is growing off a much smaller base. at first when cabela's started opening their own stores, they embraced used formats up to 247,000 square feet. that's right. they were designed as destinations, all sorts of wildlife, taxidermy exhibits, bass and trout aquariums, and mocking shooting ranges. for the kids, the strategy worked, but there was a problem. the stores weren't as productive as the company would like. the margins were too low. over the last few years, cabela's has used what they've learned to come up with a different strategy, smaller stores, fewer frills. they have five more planned in 2012. that's the ticket. plus cabela's has that old-fashioned direct to consumer biz i mentioned. 38% of the company sales. terrific for what the customer actually wants. it plans to accelerate its square footage growth this year, that's up big from 5% last year. no wonder this thing is going up
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even though gasoline is going up in price. and given they only have 34 stores right now, growth potential, i'm calling it enormous. cabela's could have ten times as many stores in the u.s. and canada and still have room to grow. i'm giving cabela's the win on growth. however, all the new stores in the world won't matter if the existing stores aren't doing well, which is why we still have to compare that same store sales metric. last year dick's posted a 2% increase. not bad. remember, they have all this other stuff, too. but cabela's were up 2.8%, slightly better, and this year both companies expect 3% growth. i'm still giving the edge to cabela's here. how about profitability? dick's has an ebit margin, earnings before income and taxes. they keep 8.2%. pretty good for retail. cabela's slightly higher, 8.7%. we know retailers love private label sales because store-branded products carry much higher margins than those
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like nike. at dick's, most of the stuff is branded. 15% of the sales are private label, and that can grow to 20% in the next couple years. cabela's, though, they have a great brand. 33% of their stuff is private label. that's another big point for cabela's. finally, there's a huge difference in what these two retailers actually sell. wells fargo did this fabulous analysis of which product categories face the most competition from online retailers like amazon. they found that hunting gear and to a lesser extent fishing faced the least competition. there's not going to be any amazoning here. this is not best browse! there's no show room action. while athletic apparel and footwear had much more competition on the web, cabela's, you're just not going to get this kind of thing from amazon. this is unique. cabela's gets 54% of their sales
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from hunting and fishing. okay? which means they're immunized against amazon as you can get. that is -- i didn't see a turkey here. dick's, on the other hand, gets almost half of its sales from athletic apparel and footwear, two of the most endangered categories. the company gets 20% of its sales from firearms, which is a fabulous business. don't get me wrong. i think dick's is a terrific best of breed retailer. but based on objective criteria, cabela's is the better opportunity, especially considering where both are traded. both have the same long-term growth rate, yet dick's sells for 17.7 times earnings. cabela's is better. in a stock picker's market -- shoot, man, they're going to spot me now. in a stock picker's market, you have to be able to pick stocks. dick's sporting goods and cabela's are both great, but cabela's has the better growth opportunity and the cheaper stock. if you want to play the red-hot
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sporting goods space, cabela's is the way to go. hey, you know what, we ought to go to tom in illinois. tom. >> caller: hey, jim. chicago blackhawks boo-yah from the windy city. >> i'm giving you a flyer boo-yah right back at you. >> caller: ooh. >> he be scared. >> caller: i'm going to bring in a little vet into our portfolio. but in light of earth week, i'd like to try and make it a little greener, whether or not that's a result of the april showers. >> all right. >> caller: as our economy continues to be exposed to increasing prices at the pump, so is the d.o.d. 90% of our government crude. according to the secretary of the army, john mchugh, that number adds up to $15 billion each year. if there's one thing that capitol hill can agree on, it's that the military needs to reduce its energy spending, all while maintaining our nation's technological edge. taking a look at lockheed martin and general dynamics, two large defense companies who seem to have a well-diversified product
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range, especially when it comes to sustainability, can you shed some light on -- >> all right. i think these companies have relatively equal businesses. general dynamics, faster growth. lockheed martin has that delicious dividend. i'm a yield kind of guy. i mean, i may not look like i'm fixated on yield, but i really am. and that's the way to go. all right. oh. anyway, i'm dressed to kill. i mean, literally. i'm on the hunt for profits for you. dick's and cabela's are both strong, but i got to tell you, i think cabela's is the camouflaged better than expected play. stay with cramer. coming up, the clock is ticking. call cramer at 1-800-743-cnbc to find out how to fire away at cramer on "the lightning round." can withstand your thunderous onslaught of stocks? do you think a bottle cap would float on the top of that head? uhhhh... -i don't. -no.
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it is time for the lightning round! >> buy, buy, buy! >> sell, sell, sell! >> are you ready? "the lightning round." the phillies game. we're going to play when this round is over. blair in louisiana. >> caller: endocyte, man. >> i like that deal with merck. jeff in virginia.
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>> jim my stock is -- >> 5% yield. stand by legget. lisa in florida. >> caller: yes. lisa, big boo-yah from miami, florida. ticker symbol bac. >> all right, sunshine. listen, i got jpmorgan and wells fargo not doing that well. no bank of america. robert in missouri. >> caller: boo-yah, jim. st. louis. >> there you go. >> caller: arch coal, aci. >> nope, nope. coal is a lower trade. that means it goes lower. stafford in colorado. >> caller: hey, jim. how are you? >> real good. how about you? >> caller: good. my question is vodafone. >> nope, nope. we like that much, much lower. i need to go to todd in florida. todd. >> caller: jim, great big university boo-yah from south florida. what do you think about solar wind ticker symbol swi? >> all right.
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people don't understand, solar wind is actually a software company. management tools. that's a very hot area. i like it. john in new mexico. john. >> caller: boo-yah, cramer. >> boo-yah. >> caller: hey, jim, listen, loose cannon ex-ceo and current chairman just resigned and the company -- >> sell, sell, sell! >> can't be more definite than that. curt in indiana. curt. >> caller: hey, jim. i just wanted to see where you think wynn is heading. >> i don't care. i like las vegas sands more. let them come up. catherine in michigan. >> caller: hi, jim. this is catherine in michigan. listen, what's going on with american capital strategies limited? >> if they come on the show, we can find out. it's a black box. i don't know what's in that stock. and that, ladies and gentlemen, is the conclusion of "the lightning round." >> "the lightning round" is sponsored by td ameritrade.
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every year at about this time we celebrate earth day for a whole week here on cnbc. every year i'm part of the sage wisdom from stock guru/gangsta rapper kermit the frog. it isn't easy being green. the companies involved in using natural gas as a transition fuel which i talked about before the break, there aren't many worthwhile green investment opportunities. solar power is a dud. it's too expensive. electric cars, highly speculative, lost people a lot of money. electric cars aren't really
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environmentally friendly because they do plug into united states coal-based grid. i like companies that help save on energy costs, but they aren't really green, just greener. but then there's clean harbors, cle, the environmental cleanup play that owns the largest integrated bulk of hazardous waste materials in north america and controls 70% of the incinerator capacity, 20% of the hazmat landfill capacity. clean harbors is a terrifically consistent business. companies disposing of hazardous materials while complying with government regulations. refineries, chemical plants, pulp and paper mills, manufacturing and power generation facilities as well as oil and gas fields. they all rely on clean harbors to take care of their waste on a day-to-day basis. this company also steps up in an emergency. they handled the cleanup after hurricane katrina, the macondo oil spill, and the yellowstone river spill last year. clean harbors has given me 76% gains since i got behind them in
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2010. lately they've pulled back, another $1.72 today, 2.65%, trading down with the oil service stocks. let's talk to the founder and chairman of clean harbors to get a sense of where his company is headed. welcome back to "mad money." >> thanks, jim. great being here. >> there's a lot of controversy, alan, about how dirty certain cleaner fuels are. there's going to be a new movie coming out, commercial movie about how dirty fracking is. we have the show "gas land." can you put fracking in its perspective as a dangerous and dirty way to get energy out of the ground versus other forms of energy that you've been involved with? >> i think fracking has been in existence for dozens and dozens of years, and today using more high-pressure horizontal drilling techniques certainly fracking has become more known in the world and has become more of a concern. but, you know, certainly throughout canada and throughout the world, fracking is something
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that's been in place. and i think we can safely manage the residues of fracking to be able to make it a viable technology. >> lately the epa, which i know you're intimately involved with because of the nature of your business, has found maybe it overreached in a case against fracking by range resources. there's also questions about the work they did in canada and questions about a pennsylvania marcellus shale site. how familiar are you with these instances and whether you think fracking may not have been as hazardous tohe environment as some thought? >> i think when you realize the number of wells that are being installed and the amount of water and the pressures that are being used, there's obviously going to be concern. but i think fracking is very safe. and i think it's here to say. i also think it is absolutely imperative to get together,
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agree on some regulations. we need to get on with drilling and get on with being energy independent. >> alan, i think that lately your stock has been gripped by a tremendous decline in the natural gas and natural gas oil service companies. do you think that it really should trade with those given the broad breadth of your business? >> no, i don't think it should, and we're moving, when we have work going on with our natural gas drilling customers, we're moving over to the liquid rich plays. we're seeing great opportunity with the low price of natural gas on the manufacturing side. our waste disposal business is really strong. we're seeing manufacturing pick up, volumes are picking up. you know, obviously it's a two-edged sword, but i don't think we should be tied to that. less than $100 million of our $2.2 billion is tied to natural gas, so it's not a huge amount of our revenues, and we're continuing to play in the
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natural gas market both in canada and the u.s. today. >> all right. alan, you mentioned the waste -- the actual waste business. now, for many years, it was considered to be environmentally unfriendly to have incinerators. did it turn out that your incineration business was actually cleaner than other ways to get rid of waste? >> absolutely. it's deemed the best available treatment technology today. and we are playing our part to reduce the amount of ozone-depleting chemicals like cfcs not only in the u.s. and north america but throughout the world. we're destroying them permanently and getting them out of the environment. that's one way we're taking the nastiest of the materials out there and permanently eliminating them from the environment. >> all right. just because it is doing earth week here, what are some green initiatives that you see that are cost-effective and have a real impact on the environment that clean harbors is doing right now besides the incineration issue? >> i think converting our
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vehicles. we have 26,000 pieces of equipment, and all of our rolling stock, we would love to be able to begin the process of converting those to compressed natural gas as an example. we're recycling more material. we're taking things like waste oil, solvents out of the pharmaceutical industry, any type of chemical material, metals out of our transformers services business, anything that we can beneficially recycle and reuse is really part of what our sustainability program is, and we're doing some great things in that area. we're also investing in technology as you saw in our bridgeport facility, putting solar units in to help run our operations. and that's a real cost-effective way. we see making more investment in that area. >> thank you, alan mckim. thanks for coming on all these times. you've done great for your shareholders. >> thanks, jim. >> i don't know if you got that key statistic of how small natural gas is for his company,
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yet it goes down like a natural gas play. doesn't make sense to me. shouldn't make any sense to you either. stay with cramer. charlotte, north carolina, where i spent the day with geico driver casey mears. i told him the secret to saving money on car insurance. he told me the secret to his car setup. first he adjusts... first he adjusts... (sfx:engine revving drowns out gecko's dialogue) then he... then he... (sfx:loud drilling noise continues to drown out gecko's dialogue) ...and a quarter cup of pineapple juice. or was that the secret to his barbecue sauce? hey, "secret" sauce. geico®. fifteen minutes could save you fifteen percent or more on car insurance. whose non-stop day starts with back pain... and a choice. take advil now and maybe up to four in a day. or choose aleve and two pills for a day free of pain. way to go, coach. ♪ try resolve easy clean to deep clean your carpets. just 3 easy steps for beautifully clean carpets.
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you wonder why investors get confused? on saturday people woke to two almost contradictory lead stories in two prestigious newspapers, the first, "the wall street journal" blares "bank earnings worry investors." the second, "the new york times," says, "solid results to banks bode well for industry." huh? so which is it? are the banks worrisome or solid? keep reading for a paragraph and find out. "the journal" writes two of the nation's largest banks release
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first-quarter results on friday that disappointed investors underlying the industry's struggles with the sluggish economy recovery and the long hangover from the financial crisis. how about "the times"? it reads, revenue is back, hard hit by new regulations and a sluggish economy, banks have struggled to revive top-line performance since the crisis even as profits improve. but jpmorgan chase and wells fargo reported strong revenue growth on friday, a surprise that could bode well for the rest of the industry and the broader economy. to me the issue is pretty clear-cut. the journal took its judgment from the hard action in the stocks, not accounting for the fact that perhaps all stocks were bad on friday. "the times" took its judgment from the facts and how the companies really did rather than looking at the share price announcing victory or defeat. i spent the weekend going over these conference calls for wells fargo and jpmorgan and i came away convinced if we weren't so worried about europe, particularly the spanish auction on thursday, both bank stocks would have been appreciably higher, not lower.
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there was nothing in this jpmorgan report that was wrong except for the fact that the government and regulatory agencies worldwide continued to hold a fairly tight rein over what the bank can do with its capital. you could argue there was a line item not up to snuff, a credit card gain here, litigation there, but jpmorgan is growing stronger than it's been in years, certainly stronger than the last time the stock was at these levels. wells fargo. let me be clear about this. wells had an amazing quarter, phenomenal, excellent growth, fantastic initial progress with the government's plan to help underwater home owners. go read that. and it took out huge costs while growing beyond what anyone expected. they're a beneficiary of european woes because they have little exposure to any part of europe but also because they purchased a huge parcel on the cheap. "the journal" didn't buy wells' story at all saying the growth appeared to slow. when i read that, i had to
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question whether they were on the same call i was. 30% of the nation's mortgage market. and you wonder if it's going to have a miraculous earnings resurgence as interest rates go higher. i'm not sure how many people realize how often journalists are letting the stocks determine this. friday was a horrid day for bank stocks because the bank reflected worries about europe, even if they shouldn't. and the yields aren't large enough to daunt the naysayers. make no mistake. the revenue growth is back, "the new york times" is right and the earnings are beginning to reflect not just cost-cutting but actual sales growth, too. stick with cramer. re are friendy but some have had a hard time understanding my accent. so to make sure people get every word of the geico savings message i've been practicing how to talk like a true chicagoan. switching to geico could save you hundreds of dollars on car insurance...
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look, i know apple's a falling knife. what do you do? my charitable trust owns it. we're going to let it come down. not going to buy anymore because we have a nice position. if you don't have any, why don't you wait until they take it to an extreme and then by two,


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