Mad Money 9/15/25 | Audio Only

Key Concepts

Magnificent Seven stocks (Alphabet, Amazon, Apple, Meta, Microsoft, Nvidia, Tesla), data centers, AI, digital twins, Chewy's business model (Auto Ship, Chewy Plus, private label), quarterly reporting vs. semi-annual reporting, insider buying, antitrust investigations, hypertension detection via Apple Watch.

The Magnificent Seven: Still Heroic?

Jim Cramer argues against the prevailing sentiment that the best days of the "Magnificent Seven" stocks are behind them. He emphasizes that these companies (Alphabet, Amazon, Apple, Meta, Microsoft, Nvidia, and Tesla) continue to possess compelling valuations and are worth owning, not just trading.

Key Points:

• Tremendous Balance Sheets: These companies have vast financial resources, enabling innovation, competition, and acquisitions.
• Scale: Their expansive reach makes them difficult to challenge.
• Reinvention: They consistently adapt and evolve, citing Meta's transformation from a desktop-focused company to a mobile powerhouse through acquisitions like Instagram and WhatsApp as an example.
• Innovation: Apple's FDA-approved Apple Watch feature for hypertension detection is highlighted as a life-saving innovation. Cramer suggests healthcare insurance companies should require its use.
• Insider Buying: Elon Musk's $1 billion purchase of Tesla stock is presented as a strong sign of commitment.
• Data Center Demand: Strong demand for data centers benefits companies like Microsoft (Azure), Meta (AI), Nvidia (chips), Tesla (autonomous driving), Google (Gemini), and Amazon (AWS).
• Gemini's Success: Google's Gemini chatbot surpassed ChatGPT in iPhone downloads, demonstrating its potential.
• Nvidia's Resilience: Despite an initial stock drop due to a Chinese antitrust inquiry (related to the acquisition of Melanox Technologies five years prior), Nvidia quickly recovered, illustrating its strength.
• Alphabet's Recovery: Alphabet's stock rebounded after concerns about antitrust penalties subsided. Cramer admits he was wrong to sell Alphabet stock based on fears of government intervention.

Quote: "The Magnificent Seven are heroes, and I'm not going to tell you to sell heroes unless something changes that makes them feel a lot less heroic."

Toast and UPS Analysis

Cramer briefly addresses viewer questions about Toast and United Parcel Service (UPS).

• Toast: While acknowledging weakness in restaurant stocks, Cramer advocates patience with Toast, believing its recent quarter was excellent.
• UPS: He expresses concern about UPS due to its high yield (7.8%), which he sees as a potential sign of trouble, given the stock's 33% decline for the year.

Apple and Corning in Harrisburg, Kentucky

Cramer interviews Apple CEO Tim Cook and Corning CEO Wendell Weeks at Corning's facility in Harrisburg, Kentucky, focusing on Apple's investment in US manufacturing.

Key Points:

• Ripple Effect: Apple's presence in Harrisburg has a positive ripple effect on the town's economy.
• Investment Commitment: Apple is investing $600 billion over the next four years, benefiting 79 factories across the US.
• Supply Chain: Apple's investment attracts other companies to build their supply chains in the US.
• Government Role: Cook believes the government's role is in regulation and setting leadership, while enterprise drives economic growth.
• Education: The need for improved education in towns benefiting from manufacturing investments is discussed. Apple offers support through the Manufacturing Academy in Detroit and partnerships with community colleges.
• Shareholder Concerns: Cook states that he has not received any complaints from shareholders regarding Apple's $600 billion investment in US manufacturing.
• International Relations: Apple maintains good relationships in China and India and believes engagement is crucial.
• Presidential Communication: Cook regularly updates the President on Apple's activities.
• Internal Monitoring: Apple's CFO, Kevin, and Cook personally monitor the company's investment commitments.

Chewy: A Buying Opportunity After a Sell-Off?

Cramer analyzes Chewy's recent stock performance, arguing that the sell-off following a solid quarter was an overreaction.

Key Points:

• Solid Quarter: Chewy reported accelerating revenue growth, expanded gross margins, and inline earnings.
• Stock Buyback: The company bought back $125 million worth of stock.
• SG&A Expenses: Higher than expected sales, general, and administrative expenses, due to a new fulfillment center in Houston, contributed to the sell-off.
• Whisper Number: Chewy's numbers didn't exceed the "whisper number" (unofficial, higher expectations).
• Gross Margin Peak: Management indicated that the second quarter would be the high point for gross margins due to growth investments.
• Market Share Gains: Chewy is gaining market share, with 8.6% revenue growth in an industry growing in the low to mid-single digits.
• Auto Ship Success: 83% of Chewy's business comes from Auto Ship, its subscription service.
• Growth Investments: Analysts view Chewy's growth investments as strengthening its long-term earnings power.
• Automation: The new fulfillment center in Houston will automate nearly 50% of Chewy's volumes within a year.
• Chewy Plus: Chewy Plus, the company's annual membership plan, is likened to Amazon Prime or Costco memberships.
• Private Label: Chewy's launch of its own private label dog food brand is a positive development, offering higher margins.
• Humanization of Pets: The trend of treating pets like family members drives spending on premium pet food.

Conclusion: Cramer believes Chewy's sell-off was unwarranted and that the stock is a buying opportunity.

Jacob Solutions and Digital Twins

Cramer interviews Bob Pragada, Chairman and CEO of Jacob Solutions, about the company's involvement in data center construction and the use of digital twins.

Key Points:

• AI Data Centers: Jacob Solutions is heavily involved in building AI data centers, which are more complex than traditional data centers.
• Digital Twin Value: Digital twins allow for simulating the effects of compute load on utility requirements, optimizing power and cooling needs.
• Cost Savings: Digital twins help save money by identifying potential construction changes and optimizing resource usage.
• Power Grid Challenges: Jacob Solutions addresses the challenges of connecting data centers to the power grid, considering alternative power sources like nuclear and on-premise LNG.
• Battery Usage: Batteries are increasingly used to manage peak loads in data centers.
• GLP-1 Facilities: Jacob Solutions is also involved in building facilities for GLP-1 drug manufacturers.

Lightning Round Highlights

Cramer provides rapid-fire recommendations on various stocks:

• QXO Inc. (QXO): Buy (Brad Jacobs' company).
• Bloom Energy (BE): Understands why it's going up, but not his "cup of tea."
• Newmont Corporation (NEM): Excellent, but prefers Eagle.
• Lam Research (LRCX): Still a buy, despite a recent parabolic move.
• Lone Depot (LDI): Not there for it (losing money).
• Centrus Energy (LEU): Good stock, believer in nuclear power.
• Alliance Bernstein (AB): Okay, historically high yield, not dangerous.
• Gain Street (GIII): Going higher because of data centers.

Quarterly Reporting Debate

Cramer discusses the debate over quarterly reporting versus semi-annual reporting, sparked by a suggestion from President Trump.

Key Points:

• Trump's Suggestion: Trump proposed that public companies report every six months, similar to the European Union and China.
• Management Perspective: Quarterly reporting is a burden for companies, tying up time and focusing on short-term results.
• Warren Buffett and Jamie Dimon's View: These titans believe quarterly reporting can hinder long-term investments in technology, hiring, and R&D.
• Andy Grove's View: The late Andy Grove of Intel believed in the importance of quarterly reporting for discipline and accountability.
• Cramer's View: Cramer generally favors quarterly reporting because shareholders deserve as much information as possible.
• Compromise: A six-month reporting period with no forecasts could be a potential compromise.

Conclusion: While acknowledging the challenges of quarterly reporting for companies, Cramer ultimately believes it is better for investors to receive more frequent data.