Dow futures are down Friday as reports of President Joe Biden’s income and investment tax proposals rattle markets.
In the last episode of Mad Money, Jim Cramer explained why investors shouldn’t worry too much about the capital gains tax proposals everyone’s talking about.
TheStreet’s Katherine Ross and Cramer are talking about Lam Research, FAANG stocks and Earth Day.
Lam Research: Buy Or Sell?
“Semiconductors are reaching new heights of strategic relevance, and Lam’s differentiated ability to meet our customers’ scaling challenges positions us well amid a strong wafer fabrication spending environment,” said Tim Archer, Lam Research’s President and Chief Executive Officer, in a statement.
Cramer said Lam Research is integral to the food chain because they make logic chips, flash memory and frankly other than Applied Materials (AMAT) – Get Report it’s the dominant company to make chips. “We don’t have enough semiconductor equipment and that’s why we have a shortage. It’s not that we have too much demand, it’s just that the companies that should have been meeting the supply were either caught off guard or were going flat out and it didn’t matter. I think Lam was not caught off guard it’s been going flat out and that’s why they continue to be good,” he added.
“FAANG isn’t dead” is the message Cramer has for investors.
Cramer said rather than saying FAANG is dead look at it as an opportunity for them to reinvent themselves. “Facebook (FB) – Get Report is up 10%, that’s not bad in an environment where it is a cyclical rally every day. Amazon (AMZN) – Get Report is up only 3% for the year, I think it’s going to have amazing comparisons. Rather than saying it’s dead, take a look at it and maybe buy one. I see real growth in FAANG M [Microsoft] (MSFT) – Get Report compared to industrial stocks like Dow Chemical (DOW) – Get Report as much as I like Dow because industrials have peaked,” he said.
Cramer said the focus on profit is no longer enough and companies want to get emissions down but without the government’s help it cannot be done because companies are all competitive, they all want to keep costs down and they all want to award shareholders.