Mad Money w/ Jim Cramer 8/20/26

Mad Money w/ Jim Cramer - CNBC

Jim Cramer hosts a special edition of Mad Money from Micron's headquarters in Boise, Idaho, highlighting the company's $250 billion investme

Key takeaways

• Micron's massive domestic investment in advanced memory chips signals a resurgence of U.S. manufacturing leadership in semiconductors.
• Despite strong fundamentals and strategic vision, Micron's stock performance is constrained by broader market sentiment driven by macroeconomic pressures like high gasoline prices and elevated interest rates.

Main topics

• Micron's $250 billion investment in U.S.-based semiconductor manufacturing
• Walmart's earnings miss and its impact on consumer sentiment

Notable quotes

"I have no fear of failure. Trailblazing women changing the game. One of my favorite pieces of advice, think about what your boss's boss needs."

Conclusion

While Wall Street remains clouded by macroeconomic fears and short-term earnings disappointments, Jim Cramer

Transcript preview

Speaker 3 (0:00) What made you confident that you could do something that hadn't been done before? Speaker 4 (0:04) I have no fear of failure. Trailblazing women changing the game. One of my favorite pieces of advice, think about what your boss's boss needs. Leadership can look in many, many different forms. It really does come down to just trusting yourself. Life is short and you just gotta... Think big to accomplish big things. Speaker 7 (0:22) Julia Boorstin hosts CNBC Changemakers and Power Players. New episodes every Tuesday wherever you get your podcasts. Speaker 6 (0:29) In the shadow of Idaho's mountains, the future of technology is being built from the ground up. My problem was born here nearly a half a century ago. Today it's building the technology powering the next industrial revolution. Steel in the ground, ingenuity at work, billions of dollars and tens of thousands of jobs. The race for AI may be global, but its next frontier is taking shape on American soil, right here in Boise, Idaho. A legacy of American manufacturing is shaping the future of innovation. Mad Buddies, invest in America from my client in Boise begins now. Speaker 6 (1:05) My mission is simple, to make you money. I'm here to level the playing field for all investors. There's always a home market somewhere, and I promise to help you find it. Mad Money starts now. Speaker 6 (1:27) Kramer. Welcome to a special edition of Mad Money, coming to you from Micron's headquarters in Boise, Idaho. Welcome to Kramerica. Other people make friends. I'm just trying to make you a little bit of money. My job is not just to entertain, but to educate, to teach you. So call me at 1-800-743-CBC. Tweet me at Jim Kramer. You take your eye off the market for one lousy day and come out here where they actually make things like a... Boise, Idaho construction site for Micron's new semiconductor factory? You realize there's an incredibly jarring gulf between stock prices and reality. Speaker 6 (2:05) Of course, the market doesn't seem to rally just because it's a beautiful day out here, does it? I'm watching 8,000 workers crawling all over 10 million square feet of steel and concrete infrastructure. But instead, what I really have to do is settle for a rough and nasty day on Wall Street, 2,150 miles away from here, where Speaker 1 (2:25) the Dow tumbled 704 points as it beat the climb 0.87%, and the Nasdaq lost a full percent. Speaker 6 (2:33) Sell, sell, sell. Speaker 1 (2:34) Oh, I wish we had a better session, though. Because there's no manufacturing process on the planet that's more complex than building semiconductors, and Micron builds them right here. This is a company that's always been committed to the United States, and we have come out here to see and praise that commitment. This company is spending $250 billion, yeah, will it be, $250 billion here, New York, and Virginia to make the most advanced memory chips. Many for the gigantic data center built out right now and soon for robots, self-driving cars. They all need memory to work, and Micron's a heavy hitter in the memory space, the third largest after Samsung and SK Hynix. If you measure a company's success by its gross margin, the percentage of revenue they keep after the cost of goods sold, What you're looking at will be just two fabs within one of the most lucrative companies in the world. Unfortunately, though, you can't take your eye off the broader market. Even if you think, as I do, that Mike Brown's stock is radically undervalued, yeah, that's even after today's $37 rally. In the end, we always have to look at stocks through the market's prism, okay? Not ours, but the market's. And right now, the market's not going to give Mike Brown its due because the factor's beyond this company's control. What is clouding the market's prism? What is making everything so dark and bare? Let me spell it out. I'm going to start with the United States of Walmart, the largest retail chain in the world, where more than 200 million customers shop every single week. Walmart's a fantastic company. You know, I think that tremendous prices lately have been able to attract people from all ends of the economic spectrum. And it has a very strong e-commerce business that was on display this last quarter. That said, when Walmart reported this morning, it missed Wall Street's expectations. Speaker 1 (4:20) To me, these results were more complicated than usual. A gigantic tariff rebate, difficult to understand, federally reimbursed pharmacy numbers. When I calculated the hit from federal drug price negotiations and backed that out, I actually thought, hey, sue me. I was in good quarter. Not great, but good. It would have been much better, though, if gasoline prices hadn't gotten up to $4. And that caused the stock to get crushed. It's not just because consumers have less money to spend when fuel is expensive. You see, Walmart has this nasty habit of keeping prices low or taking them even lower when times get tough. They've done it like this since the days of Sam Walton. It's great for customers. And long term, it's been fantastic for stockholders. Problem is, it means the stockholders right now have to take a short term hit. The people who own the stock until today, when they furiously dumped it when they saw the results, they saw two things. There are two things they didn't like. One, business didn't get worse as the quarter went on. because of ever higher gasoline prices. And two, Walmart chose to do something gutsy, make a little less money short term, order to take a lot of market share. That is good business, which sends me back to that dark prism I mentioned before, where good business isn't necessarily going to be rewarded with good stock prices. When you match Walmart's subdued end of quarter results with the continual increase in the price of gasoline, well, it doesn't become clear to us that the stock was maybe a little too high coming in, hence the 9 % meltdown today. It didn't reflect the fact that this company is willing to take a very small earnings hit to gain market share during a slowdown. It's what they taught us would make you money long term. Or to put it another way, we all understand as long as the war with Iran drags on, we're going to pay more for a lot of things except stocks. Stocks where we demand lower prices before we put more money to work. We learned that last night when the president talked about taking on Iran economically. He wants to get some sort of national, I don't know, financial siege going. Given that Iran is one of the most heavily sanctioned countries on Earth already, I'm not sure what else we can do, or even if it matters. Now we're getting retail earnings this week, and we have some good ones, Target and Home Depot, as well as some not-so-good ones, Walmart and maybe Lowe's. They don't cancel each other out, though. Walmart's so much bigger than every other retailer that it casts a pull over the entire industry, over the entire shopping business. At the same time, this would have been a better day if interest rates had gone down. Our Treasury Secretary has resorted to buying back an unusual amount of Treasuries to hold rates down. I don't know about that. When America has $40 trillion in debt, a $4 billion buyback of long-term Treasuries has the Treasury Secretary looking a little like the little Dutch boy with his fingers plugging the dike. Give that man another, say, billion fingers, and maybe he'll be able to take care of all this. So we are stuck with assuming that because Walmart didn't deliver, the American consumer really is slowing down. As much as I'd like to say that's what's behind me, raw American manufacturing might is what matters, that this is why we should own stocks, I have to remember that two-thirds of our country is service-based. Walmart is the thermometer for the service-based economy. And today it showed a somewhat sickly patient, one that won't get better until peace breaks out in the Middle East. Historically... That's not something we necessarily want to make a bet on. Now, because rates came down, maybe rates will come down. Maybe they will come down. I don't want to say the Treasury Secretary doesn't. Maybe he's a magician, OK? Maybe he's more of a magician successfully pulling up the 30-year Treasury than he is a Dutch boy plugging holes. Maybe the consumer gets used to $4 gasoline unless it's going to $5. But we're just going to have to be satisfied with the micron marvel, which goes on for acres and acres in some places as far as the eye can see. Tonight, we're learning why this very special company is doing amazing things for our country and succeeding in an industry where so many American companies have failed and making boatloads of money while doing it. The bottom line, let's not despair too much. Micron stock did finish up 4%. That's terrific American exceptionalism at work. The problem is there's another 499 stocks in the S &P 500, and the prison made a lot of them look downright awful today. All right, get oil down, get interest rates down, and the prism will be a heck of a lot better. This picture is spoiled by a different backdrop, one that is 2,000 miles away. Let's talk to Sam in Pennsylvania. Sam. Speaker 8 (8:44) Jim, listen, after J.P. Morgan downgraded Nike, I have to say, as a consumer of their products, I think I can help the C-Suite out with some tips here. This has been an ongoing issue for a couple of quarters now, if not a couple of years. Stock is down 70 % from where it was. And I think what you need to do is focus on the core consumer and increase the quality of the product. You've got to offer us a value proposition. It's enough with the sustainable materials. Get back to the core ideology of Nike being the best at Speaker 1 (9:12) what they do. You know, so... Who's that saying? What company? Nike. Nike. All right, Sam, look, I wish it were just quality. I wish it were just market share. I wish it were just the cost. I wish it were something. There are just too many things going wrong right now with Nike. And the whole industry is slowing down. Sometimes you can't even blame them for what they're doing. It's just nothing's working. Micron is succeeding in an industry where so many others have failed. That's partly why it was one of the only positive AI-related stocks in today's red tape. On May Money Tonight, on the heels of their $250 billion manufacturing announcement, I'm sitting down with our host for the day, Micron's CEO. Don't miss our wide-ranging conversation. Then a different Boise-based company, Albertsons, hasn't been doing that well at all. So what's been going on with that grocery stock? I'm digging deeper, and I'm taking you behind the scenes of this fantastic facility and showing you the area that inspired me the most. and reminded me just how meaningful Micron's American investment is. So stick with Kramer. Don't Speaker 5 (10:29) miss a second of Mad Money. Follow at Jim Kramer on X. Have a question? Tweet Kramer. Hashtag Mad Mentions. Send Jim an email to madmoneyatcnbc.com or give us a call at 1-800-743-CNBC. Miss something? Head to madmoney.cnbc.com. Speaker 3 (10:51) What made you confident that you could do something that hadn't been done before? I Speaker 4 (10:55) have no fear of failure. Trailblazing women changing the