Mad Money w/ Jim Cramer 7/11/24
Digest
Jim Cramer discusses the recent stock market rotation, where investors have shifted from tech stocks to smaller companies. He explains that this shift is driven by lower bond yields, which make stocks that thrive in a low-rate environment more attractive. Cramer highlights specific examples of stocks that have benefited from this rotation, including home builders, lumber companies, and Stanley Black & Decker. He emphasizes that this rotation is likely to last for about three days and that investors should be cautious about overstaying their welcome in these stocks. Cramer also discusses Conagra Brands' recent earnings report, highlighting the company's volume growth and its conservative outlook for the future. He concludes by discussing Delta Airlines' disappointing earnings report and warns investors against buying airline stocks, citing the industry's lack of discipline and the potential for a race to the bottom.
Outlines
Introduction
This Chapter introduces the podcast and its host, Jim Cramer. It also mentions the topic of the day, which is the stock market rotation.
Stock Market Rotation
This Chapter delves into the recent stock market rotation, where investors have shifted from tech stocks to smaller companies. Cramer explains the reasons behind this shift, including lower bond yields and the attractiveness of stocks that thrive in a low-rate environment. He provides specific examples of stocks that have benefited from this rotation, such as home builders, lumber companies, and Stanley Black & Decker.
Conagra Brands Earnings Report
This Chapter discusses Conagra Brands' recent earnings report. Cramer highlights the company's volume growth and its conservative outlook for the future. He also discusses the company's focus on protein and fiber-centric snacks and its new product launches, including the Dolly Parton Duncan Hines line.
Airline Industry Outlook
This Chapter focuses on the airline industry and its current state. Cramer discusses the challenges faced by airlines, including overcapacity and supply chain issues. He also analyzes Delta Airlines' disappointing earnings report and warns investors against buying airline stocks, citing the industry's lack of discipline and the potential for a race to the bottom.
Keywords
Stock Market Rotation
A shift in investor sentiment and capital allocation within the stock market, often characterized by a movement from one sector or asset class to another. This rotation can be driven by various factors, such as changes in interest rates, economic conditions, or industry trends. For example, a rotation from growth stocks to value stocks might occur when investors anticipate a slowdown in economic growth.
Bond Yields
The annual rate of return an investor receives from holding a bond. Bond yields are inversely related to bond prices; when bond prices rise, yields fall, and vice versa. Changes in bond yields can significantly impact the stock market, as they influence the cost of borrowing for companies and the attractiveness of alternative investments.
Conagra Brands
A multinational food company headquartered in Chicago, Illinois. Conagra Brands owns a diverse portfolio of well-known food brands, including Slim Jim, Duncan Hines, Orville Redenbacher, Angie's Boom Chick-A-Pop, and Birds Eye. The company operates in various segments, including snacks, grocery, and frozen foods.
Delta Airlines
One of the largest airlines in the world, headquartered in Atlanta, Georgia. Delta Airlines operates a vast network of domestic and international flights, serving over 300 destinations worldwide. The company is known for its extensive route network, frequent flyer program, and focus on customer service.
Airline Industry
The sector of the economy that encompasses commercial air travel, including airlines, airports, and related services. The airline industry is highly competitive and subject to various factors, such as fuel prices, economic conditions, and government regulations. The industry has experienced significant consolidation in recent years, with major airlines merging to gain market share and reduce costs.
Q&A
What is driving the recent stock market rotation?
The recent stock market rotation is driven by lower bond yields, which make stocks that thrive in a low-rate environment more attractive. These stocks include home builders, lumber companies, and Stanley Black & Decker.
How long is this rotation likely to last?
Cramer believes that this rotation is likely to last for about three days.
What are some of the key takeaways from Conagra Brands' earnings report?
Conagra Brands reported volume growth and a conservative outlook for the future. The company is focused on protein and fiber-centric snacks and is launching new products, including the Dolly Parton Duncan Hines line.
Why is Cramer warning investors against buying airline stocks?
Cramer is warning investors against buying airline stocks because of the industry's lack of discipline and the potential for a race to the bottom. He cites Delta Airlines' disappointing earnings report as an example of this trend.
What are some of the factors that are impacting the airline industry?
The airline industry is facing challenges such as overcapacity and supply chain issues. These factors are contributing to the industry's lack of discipline and the potential for a race to the bottom.
Show Notes
Listen to Jim Cramer’s personal guide through the confusing jungle of Wall Street investing, navigating through opportunities and pitfalls with one goal in mind - to help you make money.
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