You might think “coolness-per-share” is a frivolous way to value stocks, but in today’s market, that’s exactly what investors are looking for, Jim Cramer told his Mad Money viewers Monday.
Cramer said Monday’s action was all about cashing in on the old and buying up everything that is new, especially if it’s cool.
That’s why investors were selling the oil patch, as concerns over fossil fuels and climate change wreak havoc on the sector. Shareholders also sold Boeing (BA) – Get Report after delays with the 777x became the latest in a host of issues plaguing the aircraft maker.
What are investors buying that’s cool? Look no further than gene therapy with Intellia (NTLA) – Get Report rocketing 50% on positive clinical trial news. That sent shares of Edits Medical (EDIT) – Get Report higher as well. Investors are also rediscovering Tesla (TSLA) – Get Report, along with PayPal (PYPL) – Get Report and Nvidia (NVDA) – Get Report, which popped 5% on news its acquisition of ARM Holdings (ARMH) might actually happen.
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Off the Tape: Deep Instinct
In his “Off The Tape” segment, Cramer spoke with Lane Bess, chairman of the privately held Deep Instinct, a cybersecurity firm that guarantees its customers protection against attacks.
Bess explained that Deep Instinct uses proprietary artificial intelligence and machine learning algorithms to detect and prevent attacks like ransomware before they end up costing companies millions of dollars. He said recent surveys found that 70% of systems operators expect to be attacked, which is why Deep Instinct guarantees its services.
With ransomware attacks becoming more high-profile, Cramer said companies can no longer not afford to use services like Deep Instinct to protect themselves.
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IPOs in the Spotlight
We’re already halfway through the year and the IPO market has been on fire. We’ve already seen 214 IPO deals hit the street, compared to just 242 during all of 2020. And that’s not even including over 350 SPAC deals that have also been vying for investors’ attention.
But not all IPOs are created equal, Cramer reminded viewers. The Chinese IPOs, in particular, are especially risky. In 2020, the median Chinese IPO rose just 4% compared to 32% for all non-Chinese IPOs. In general, larger deals tend to perform better than smaller ones, Cramer noted, but even then, success is now guaranteed.
That is unless you’re talking about Didi, the Chinese ride-sharing giant that has the backing of everyone from Tencent to Apple (AAPL) – Get Report. Cramer urged investors to pick up as many shares of Didi as they can in this red-hot upcoming deal.
Executive Decision: Etsy
In his first “Executive Decision” segment, Cramer spoke with Josh Silverman, CEO of Etsy (ETSY) – Get Report, the online artisan marketplace with shares that rose 7.3% Monday after the company announced the acquisition of Elo7, which is already regarded as “the Etsy of Brazil.”
Silverman said that Elo7 was modeled after Etsy and is well-positioned and the perfect marriage. Elo7 boasts 56,000 sellers that offer over eight million items for sale to 1.9 million registered buyers.
Silverman was also excited about Depop, their marketplace for clothing. He said apparel is a hug untapped market and one that really benefits from a marketplace like Etsy to bring buyers and sellers together.
When asked whether Etsy would consider accepting cryptocurrency as payment, Silverman said that today, most people are investing with cryptocurrencies, but so far, they haven’t seen a lot of interest in using it for tender.
Don’t Be a Meme
In his “No Huddle Offense” segment, Cramer had a message for the CEOs of small cap companies… don’t aspire to become a meme stock.
On the surface, becoming a meme stock on WallStreetBets seems like a godsend. The crew bids up your stock by crushing the short sellers and you can to raise capital at elevated levels and save your company.
But while this strategy worked for GameStop (GME) – Get Report and AMC Entertainment (AMC) – Get Report, CEOs need to remember that in order for this strategy to work, their stock needs to be heavily shorted. And stocks don’t get shorted because they’re doing well. That’s why CEOs shouldn’t wish to become a meme, they should wish to do well without needed outside help.
Here’s what Jim Cramer had to say about some of the stocks that callers offered up during the Mad Money Lightning Round Monday evening:
Lightspeed POS LSPD: “I think these guys have a good story to tell.”
Coinbase Global (COIN) : “I would just buy Ethereum. “
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At the time of publication, Cramer’s Action Alerts PLUS had a position in PYPL, NVDA.