Mad Money 10/28/26 | Audio Only

My mission is simple, to make you money. I'm here to level the playing field for all investors. There's always a bull market somewhere, and I promise to help you find it. Mad Money starts now. Hey, I'm Kramer. Welcome to Mad Money. Welcome to Cra America. Other people, my friends, I'm just trying to save you a little bit of money. My job is not just entertaining. It's to put it in context. So call me at 1800743 CNBC or tweet me at Jim Kramer. Look, I'm a stock market junkie. Always have been, maybe always will be. Perform my first lightning round at a graduation ceremony from Harvard Law School in 1984. In a lightning round, all stocks big and small are created equal, and any percentage gains a win regardless of what stock it emanates from, even a tiny one. But for a couple of days of the year, we just can't focus on those percentage gains for smaller companies because we have a handful of behemoths that are now the hallmark of this market and they control the process. On a day when the Dow was up 98 points, S&P gained 28% and the NASDAQ mounted a late day comeback to finish up 27%. You need to know some stocks are more equal than others. What makes for a higher priority stock in this market? First, it has to have nation state status where the ability to raise money in return for offering endless amount of services can just happen like that. It needs a big boat instead of an army and a major part of the GDP of an important governmental entity like the US. It has to make a huge and growing amount of money per product. The products have to be sold to either the consumer or the enterprise or ideally both. Management has to have cuttingedge technology. Has to be willing to go outside the comfort zone and spend more money than they have. And they must have an impact, a reach far greater than a lot of the companies. Only very few companies qualify as nation states. The public ones are Nvidia, Apple, Alphabet, Microsoft, Amazon, Meta Platforms, Tesla, and now SpaceX. The private ones are anthropic and open AI. Their heft is so extraordinary that me money cannot go without covering them. Now, I don't want to jump the gun. Even these 10 companies, no matter how powerful, cannot withstand the currents of the war and interest rates. They are not kayaks or dingies in an ocean filled with five handle treasury yields and tripledigit oil prices. They're more like aircraft carriers, not easily blown to and fro, but not immune either. As always, a macro factors can upset any flight path. At this moment, oil and rates are having an outsized influence when it comes to the direction of these stocks. Today, oil jumped as the president talked about launching some sort of short intense action against Iran, maybe the hoodies. It was all a bit vague. At the same time, Fed Chairman War spoke after the two-day Federal Reserve open market committee meeting and he made it very clear that inflation was still too high. But that before the Iranian war and the roaring price of oil just made it worse. He said you can't ignore the price of oil just because it could go down one day when you were pumping expensive gasoline into your car right now. Morris traced a picture of economic strength that is too strong for your taste because it's fueled by all sorts of excessive spending without much restraint by consumers or by corporations. we could all take his Spartan words to mean different things. I heard him say that we aren't going to get inflation down to 2%, his target, with this much spending. He reminded us that the power of his interest rate soared is big, pointing out that some companies have been more discerning in their spending after that quarter point raise he already gave us. If he could tamp down more of the spend, then he can get the inflation rate in line and maybe he can do that by jawboning. I like that. I listened. I didn't hear anything that could derail the biggest companies. In fact, in a serendipitous moment, Oracle came out and talked about how its data center spend is paying off, lessening the credit quality issues that have dogged it. For your statements do didn't do that much to the market. It wasn't an accelerant. It wasn't a glancing blow either. I sense another rate hike in December. Uh maybe there aren't some big decisions that will be deferred and spending curb, but I think the interest rate increase it's working. All that said, the nation state companies that reported tonight, Alphabet and Microsoft, weren't impacted all that much by a tough talking Fed, but they were impacted by the person physicists. Alphabet and Microsoft, both with market caps of just under $4 trillion as of tonight's close, have tentacles that do not confine themselves to their own lanes. They skate in multiple lanes. Alphabet and search, YouTube, Chrome, Whimo, Google Cloud Services, Microsoft and Enterprise, consumer uh software, Azure, LinkedIn, video games, copilot, they have all developed well uh really good artificial intelligence capabilities. Alphabet was the big story tonight though and it was not a positive one. Alphabet posted disappointing double miss on both the top and bottom lines, sending shares down sharply after hours. Revenue grew nearly 25%. We should be happy with that, right? But search, which accounts for about half of sales, came in about a billion and a half dollars below expectations. That's likely to reignite the debate about whether AI is eating into Google's core business. The bright spot was cloud where revenue was more than double and beat expectations going 103%. Gemini now is more than a billion monthly active users. Capital spending also came in below expectations, though the company signaled a significant increase in capex for next year. Free cash flow was also negative 9.1 billion. Something you hate to see from a company that used to spew cash and had a pristine balance sheet. Part of the challenge now is deciding how much computing power and how many and many of its custom AI chips go to paying cloud customers versus its own products including Gemini. Cloud is delivering but that wasn't enough to offset a disappointing quarter for the core business that pays for these ambitions. Microsoft on the other hand, wow, great story. Beat on every single line. Total revenue grew 19% easily beating expectations while the company's earnings per share surged 32% trails the consensus estimate by 19 cents. Highlight Azure business grew 48% year-over-year. We were only looking for 45% growth. That's pretty stunning. I remember we were hoping to get back to 40% for Azure, which is their cloud business, but the AI tailwind keeps getting better and better and better. Aside from that, Microsoft showed a degree of spending discipline that makes this unique among these so-called hyperscalers, which is why I think it's going to leap out and be the best of them. Capex result much lower than we thought. Now, remember with Microsoft, you're never out of the woods until the conference calls over. That's happening now. So, we'll see what they have to say, especially about their capital spendings plans and their guidance for the current quarter. But assuming no major surprises, this was the winner from tonight's two big magnificent seven reports. Don't worry, there's a lot more coming. And remember, I'm calling it the MAG 10. We own both of these for the charable trust. Not because of the size of this quarter's performance. We own them for their body of work. Their market capitalization is simply a function of their greatness. Although a company can be the size of an aircraft carrier and also be overvalued. I am concerned that that could be the case with Alphabet after Google's poor showing tonight. But the bottom line, we saw tonight why you can't you ignore these stocks. Drone Pearl, we saw nothing that shocked us, nothing that enraged us. Apple's going to catch a downgrade or two. search could really be hurting. But Microsoft, it's justifying the monster move it made off the bottom back at the end of June earlier this year. Let's go to Andrew in South Carolina. Andrew, >> it's incredible. Is this Professor Kramer? >> You bet it's Professor Kramer. How you doing? >> I'm all right. So good. >> I've got a defensive stock. It's pulled back massively near its 52- week low. gives you a secure 4% cushion to wait and it's about to pull off the second largest food merger in history. I'm practically at break even on my position. Should I double down on the seasoning and spice up my portfolio or clear the table and walk away from McCormick? >> I think down here at 46, you can't walk away. They've made an acquisition. They paid too much for it uh from Unilever. But at this point, I think that the damage has been done. This used to be a very high multiple stock. It's no longer is. Actually, the multiples almost been cut in half. You stick with it, my friend. Let's go to Chris in Colorado, please. Chris, >> hey Jim, I got a question about uh I need your advice on my Palunteer stock. It accounts for 30%. >> Buy by buy. Okay. It's Palanteer. Buy. They're the smartest guys I've come across. I'm not kidding. I feel that strongly about Palunteer. Let's go to Sam in Pennsylvania. Please. Sam. >> Jim, listen. I was putting on the stock screener to see stocks that companies that are high capital efficiency. I was looking at high ROIC and consistent sales growth. That's where I came across this this interesting company Argon. AGX is the ticker. See, they're contracted manufacturers of or they're contracted to build power plants, specifically natural gas. Stocks come down dramatically. I think it could be a buy here given the consistent, you know, this is a this is a strong ROI, a strong ROE company. Um, and it's in a secular growth area. You know, we need power generation, whether it's AI or general. >> I totally agree with you. We looked at it. We kind of we kind of liked it. We, uh, you know, I got to tell you that hasn't certainly uh, made it be a buy because it's still going down. You know something? I know this is going to sound silly, but Sam, you got to understand this is the worst chart I've ever seen. Period. End of story. Today showed us that you ignore Output and Microsoft at your own peril. They're nationstate stocks. They deserve to be treated as such. even as Alphabet did not report a good quarter. Well, mainly tonight, Chipotle has been cut in half. So, uh what will it take to get the stock moving again? I'm talking guac with the CEO and Service Now's making a comeback along with other software stocks. So, does it have more room to run at today's report? I don't know. Looking a little toppy. I'm going to talk to Ras. And how is WM digesting higher fuel prices? I'm getting all the latest when I sit down with the company CEO after earnings. So, stay with Kramer. Don't miss a second of MadMoney. Follow at Jim Kramer on X. Have a question? Tweet Kramer #madmentions. Send Jim an email to madmoney@cnbc.com or give us a call at 1800743cnbc. Miss something? Head to madmoney.cnbc.com. All right, what do we make of these numbers from Chipotle Mexican Grill this evening? This is stock that's been more than cut in half from its 2024 highs was down more than 20% this year heading to the report. After the close today, Chipotle reported, I guess, what some people regard as a mixed quarter. Same store sales rose 2.1%. I like that. It's better than expected. Both customer visits and the average check increasing. That makes three consecutive quarters of positive transaction growth. Earnings came in two cents below expectations. Restaurant margins fell a tad short. So, can Chipotle finally get the stock's momentum rolling in a difficult environment for restaurants? Let's check in with Scott Bo. He's the CEO of Chipotle Mexican to find out. Mr. B, welcome back to Mad Money. >> Hi, Jim. Uh, good to be back. Good to see you again. >> All right. Thank you, Scott. Same to you. Well, we got 2.1% same store sales. Now, that is appreciably better than what people were looking for. So, uh, and I love the fact, by the way, that you've got some good traffic. How do you explain the fact that you were able to beat the consensus of people who thought that things were had petered out from the previous quarter? >> Yeah, it was a really challenging quarter from a consumer perspective, but I'll tell you, our recipe for growth initiatives, uh, as outlined at the beginning of the year, starting to pay, uh, real dividends for us. Uh the good news is Jim, we're still early days in that strategy where the core tenants of the strategy are yet to unfold or are unfolding and will build in scale over the coming months. So I'm confident in our ability to drive demand through LTO innovation, deeper engagement with our rewards members, which uh rewards comps outpaced uh in restaurant comps this quarter. And we're seeing a lot of real broad support from all income uh cohorts as well as age co uh age groups. >> Well, that's important. I mean, some people, you know, the rap is always, hey, look, it went up too much in price. If you're seeing all cohorts come in, then maybe uh the price is right, so to speak, for more people than I than I know I realize. >> You know, I think we still all have uh this urgency around creating a compelling value compelling value offering for our consumer. But I'll tell you, the lower income cohort outperformed the higher income cohort for the first time last quarter probably in the last two years, which is encouraging for us, which tells us we're on the right track. And our value for the money scores continue to hold steady. We saw a really nice jump in the last quarter, which we're really proud of. We're going to continue to lean into that momentum. All right, so let's go into something that I have historically not cared as much about uh versus same store sales, but I didn't candidly like the direction because it reverted to some a pattern from before. Restaurant level operating margins back to 23.3% where they were in Q1 2026 after jumping at 25.2 last quarter. What do you make of that? >> Yeah, Jim. So, some of that was deliberate. uh we are intentional around promo spending for the quarter uh given what was going on uh within the industry whether it was uh the supply chain challenges that the industry faced kind of mid August and to arrest and resupport the momentum we were had in the business earlier in the quarter we did some additional spending which cost us about 40 basis points of margin also we had some one-time hits in uh in labor as it relates to insurance line items that were unanticipated and particularly transitory So, we have confidence that between the dislocation of our pricing and inflation, which we've talked a lot about this year, and the intentional spending that we did in the quarter, we feel like we're still on the right uh trajectory to hit our long-term algorithm. >> And I thought that food costs falling to 29.5 of sales. Again, I want to see that because it makes me feel that maybe inflation is in your industry and at your company a little more in control than others. >> Yeah, we think so, Jim. We're still seeing inflation as it relates to stake uh and freight costs are up year-over-year at a pretty uh pretty significant clip. Uh but nothing we can't manage as we go forward with the right strategy and the right approach. Uh again, I think it's early days for our great brand. And you know, I think it's important for people to note that while we're early days in the strategy, um, if you think about the strength of the Chipotle brand, as strong today as it's ever been with extraordinary fandom, we have food that hits people's needs no matter where they are in their life. Whether it's GLP1, whether it's keto, whole 30, high protein, high fiber, we're your go-to stop for high quality, great food at a great price point. And I'd like to remind everyone that we have still industryleading economics. And Jim, we have more growth ahead of us than we have behind us. And so we're going to continue to grow and expand. We're going to build a new Chipotle this year about every 24 hours. That growth will continue into 2027. We feel front-footed in a really challenging environment, Jim, and we're going to continue to lean into this momentum. >> Well, let's talk about the challenging environment because I'm listening to Fed Chief Walsh today. He's talking about spending remains robust. And then I think to myself, are there too many uh restaurants that are in the same kind of bracket that you are? For years I only thought of you. Okay, there's Chipotle and that's a step above everybody. And now I don't need to mention competitors, but you know there are a bunch of them that people go and they say, "Oh, good. Another 15 to 17 that's really good." Are is there too much in your range right now? You know, Jim, I think of us as being more category defining uh brand within the industry. And I think that's an important note. I don't think there's anyone that really delivers an offering as compelling as ours. When you think about the way we source ingredients, how we prepare those ingredients fresh every day in restaurant and deliver them at a speed and abundance you can't get anywhere else. If you just take a look at our highest penetrated markets like Ohio and Florida where we have extreme competition in those markets, those are the markets we're growing the fastest in today, Jim. And we're still seeing the highest returns in the system out of those markets, nearing almost 80% year 2 return on investment, which gives us confidence we can grow in any environment that I think there's still a lot of white space within fast casual as a percentage of the overall uh industry spend. There's a lot of headroom for us, >> right? That's very dispositive and I appreciate that granularity which helps me really does help me put to to rest that category just on the one time only labor issues that you talked about there what in wage inflation these bonuses that you gave I know you need to retain retain the best people but is that is it getting too expensive or really will it be uh you took care of it and maybe you bonus people and they'll stay and we don't have to see that again. Yeah, I think it's right size, Jim. Most of that inflation came through um insurance and workers compensation measures, which we'll talk about, which we talked about on the call. Yes. Uh I don't think it's related to employee comp. I think we we do have better uh industryleading wages for our team members and industryleading benefits. We've had those for years though, Jim. And while we've seen modest inflation, I think it's normalized this year. And the labor market seems to it seems to be resilient. I mean, we're continuing to be at all-time staffing levels. Uh, our avocado, our AI assistant, has really helped us keep our restaurant staff with better applicants, shorten the time from application to hire, and we feel front footed as it relates to labor. >> All right, one last question. Uh, you're bringing back one of our faves, the brisket. Uh, that was very wellreceived. When you see something like that, um, do you expect that maybe you'll get a bump again because it was obviously such a popular fa favorite? Yeah, as we talked about on the call, Jim, you know, we saw some choppiness coming into Q4. Uh we're guiding Q4 to about a two. We think our exit rate on the year is going to be between three and 4% growth, which uh really talks about the strength of what we're going to see with Brisket and some of the other timing of promos that we have for the fourth quarter. November and December set up very well for us. uh and again our initiatives and recipe for growth whether it's heap whether it's group occasions catering which we're launching in Q1 of the upcoming year there's a lot of momentum in the business that will continue to scale and build over the next few months so uh should be an exciting quarter for >> thank you Scott very encouraged by the most important metric which is same store sales and I once again I always thank you for your uh confidence in us and coming on our show appreciate it >> thank you Jim we appreciate being here >> thank you Scott Bored is the Chipotle CEO at CMG and Mad Money's back after the break. >> Coming up with Service Now shares on the move, Kramer's getting the inside scoop with the top brass next. The enterprise software segment faced a big test tonight after the close when Service Now turned it results for the third quarter. Look, ever since it bottomed to $81 and change this past spring, this stock has been leading the group's comeback, climbing nearly in a straight line to over $150 today at the close. Tonight, the company turned in a result that was strong. All right, not perfect, but strong. Company's revenue results look good as did it. Booking numbers, which is what I care about. That's encouraging. On the other hand, it missed by two cents on the bottom line. Cash flows for the quarter were considered a bit light. Guidance was similly mixed, but we got to get to the bottom of that. Is it enough to keep the stock in rally mode? Let's go straight to the source with Bill McDermott, the chairman and co of Service Now. Mr. McDerman, welcome back to Mad Money. >> Thank you, Jim. Great to be back with you. >> All right, so Bill, there's a a ton to go over here, but first I want to give you some credit. You came on the show uh when the stock was at 104 and you were very loud. You bought $3 million of stock. You were making a statement, and the statement was this is getting ridiculous. How did you know that it was overdone and that the whatever it was on Wall Street had disconnected from the fundamentals of service now? >> Jim, this is a unicorn growth company. You know, think about Fortune 500 economics with a super intelligence control tower that's literally reinventing businesses all over the world. So I knew the exceptional super intelligent economics where you have a capital light marginrich consumptiondriven company that's really providing AI value without all of the big cost items uh like chips and capex and data centers. We just have a margin profile that's perfect and a growth company operating at the rule of 57. when you add up free cash flow and margin growth, it's the only company I'm aware of that's doing that in the enterprise software world. >> Oh, that is true. And now Armis, uh, which you bought for 7 billion. To some, it was a headscratcher. Why is this man moving into cyber security? In retrospect, I think people now call service now because they don't know what to do. Everybody's scared. And I think that you've got the right property to be able to help. >> Jim, you said it right. The super intelligence control tower actually takes the right model. It hires it for the right job to solve the right problem to unlock the real opportunities that companies have out there. So we're unlocking the value from the entire super intelligence ecosystem from silicon to intelligence and we're executing this on one platform. So you and I spent a lot of time with my good friend, our good friend Jensen at Nvidia. Think about AI governance that takes software all the way through to the silicon and it's an industry first of its kind. So you have a longunning personal AI agent at Service Now. It gets better with every interaction. It has runtime enforcement. So Service Now sets the rules and rails. Nvidia OpenShell enforces them at runtime. So we have a kill switch that can revoke the passport for a person, an agent or a robot and block the action at the point of execution, not after damage is done. And that's what everybody wants. They want a secure, super intelligent control tower to run their business and drive profits for their shareholders. And that's what we're giving them. So, Bill, why do some of these people in these frontier models say that there is no such thing as a kill switch? Are they just wrong? >> Well, they're looking at it a little bit differently. I'm looking at the enterprise software world and I think that's why Open AI today announced a major partnership with Service Now because they all want to turn frontier intelligence into governed and enterprise execution. So if you think about the the super intelligence control tower, we're using open AI voice now chat GPT to simplify AI risk assessment. And we have something we call shift zero where you're stopping threats before they become incidents. And if you think about builders out there with codeex, they're now going to run it through service now with rules and rails. And that's the same announcement we made with Google and several other great companies today like Anthropic, AWS, uh Cisco, Open AAI, of course, Stripe, um Nvidia, and many others. And that is what's missing, Jim. One control tower that connects your people, your agents, all your lab models because they're all great companies. It unifies your data. It integrates with a complex infrastructure and enterprises. and it gets you to value fast. Customers want value now. Okay? >> And they don't want a proof of concept. They're tired of the stories and they're tired of laying out money without getting a return. >> I am absolutely sure that is the case. But I also have to deal with what we see on the on the tape, so to speak. And we know the tape's wrong a lot because it's been wrong a lot when we when we come to Service Now. But people are saying, "Listen, there there are estimates out there. It missed the earnings estimates by two cents. They're not looking at the revenue growth, which was really strong, the RPO, which is strific. They're not ruling it to what we look at growth in margin. They're saying no, he missed by two cents, and that's just not excusable with this high market multiple. >> Well, let me offset that a little bit. First of all, the two cents has to do with the interest on the companies we just bought. And the companies we just bought that impact EPS, but we now in this quarter and we just bought them in April announced 150 basis point improvement in operating margin. We have free cash flow at 36%. And we have our revenue in RPO and everyone said you'll have shorter duration contracts and they'll be lower in value. Actually just the opposite happened. Our RPO is growing now to 30 billion at 23% and our subrevenue is at 21%. That's a operating at 57 company. 21 + 36 is 57 and I told the markets we'll be 60 soon meaning operating at the rule of 60. So 2 cents is interest expense on 5 billion because we chose to allocate the capital to debt because we generate so much free cash flow. But in one snapshot, yes, EPS102 was an expectation versus $1. And everybody knows in software that's the least important measurement at the time. And Jim, I got to tell you, what other company can say that they're growing the way we are with no compute constraint, no memory constraint, no data data center buildout constraint, just pure free cash flow, operating margin, and revenue growth. What other one? Not a single one. So shareholders, I gave you my word. Um, back as you said, Jim, early in the year, and the story's only gotten a lot stronger now. Do you know we are growing our consumption on this hockey stick of tokens I have out there 13x year-over-year 500% month over month. So, as you see these revenues, just remember I've got tokens out there on the street with Service Now that we're getting these customers live faster. And as they get live and they go through their first trunch of con consumption, they will renew that and that will be a hockey stick formation that is unlike any other in the enterprise. So, I would just say this is a great quarter, Jim. >> All right. Well, that's where we're going to leave it because I think that people have to digest that and say maybe maybe they're looking at this. I I thought you explained the two cents very well. They should be looking at the at the things that you and I know what really matter, which is RPO, revenue growth, new customers, all those going your way. Bill McDermott, chairman, CEO of Service Now. Bill, thank you for coming on the show. >> Thanks a lot, Jim. Appreciate it. >> We have money back after the break. >> Coming up, was waste management able to pick up a clean quarter? Kramer's digging in with the CEO to find out next. A couple months ago, WM, the leading waste management recycling company, announced that longtime CEO Jim Fish will be retiring at the end of this year. Now, this is bittersweet news because the Jim Fish era has been one fabulous year for great era for shareholders. Since he took over, get this, as CEO almost exactly a decade ago. WVM shares up nearly 250% with total shareholder return though, more important, 300% that significantly outperformed the S&P 500 industrial index and the Dow. Last night, the cut reported third quarter results delivered what looked to be a mixed set of numbers thanks in large part to higher fuel prices. That's why the stock dipped a bit today, down over 4%. I'm not too worried. The higher fuel price headwind is out of the company's control. Plus, WM also reiterates its fouryear outlook with the quarter, which is what I care about. So, let's take a closer look at the story with Jim Fish, the outgoing CEO of WM. Mr. Fish, congratulations upcoming retirement and your fabulous work for shareholders. >> Thank you, Jim. I appreciate it. >> Okay, so one thing that you did, you were able to change and adapt all in your 10 years, the company really had to deal with some things that people don't realize. You were basically at one point if there was a lot of housing, there was a lot of housing things to be able to card away and that was a big part of your business. That almost disappeared in this. In the meantime, you went into the into health into this medical waste business, which has been fantastic. Did How did you see this this uh this storyline coming? >> Well, I think when you look at healthcare, I mean, look, we're all getting older. I I read somewhere that the average American was 29 years old in 1980 and now we're 39 years old. So, if I were to ask you, what business do you want to be in that'll take advantage of that? It's got to be healthcare related. So, we like the healthcare business. the volume picture, which they asked a thousand questions on that today on the call, is a long-term growth strategy. What we really wanted to do was take some of the cost out, fix the systems, and all of that has been done over the last two years. >> Now, I think it's important people might say, "Well, wait a second. They missed the quarter." You made it very clear it was diesel. What you didn't have to make clear because people understand it's also in the deck. Your company has tremendous defensive characteristics. >> Yeah, >> it really does. >> Well, look, it's it's uh that's kind of the selling point of the industry. It's uh it's a defensive stock. It's it's pretty recession resistant. Not recession proof because we do have some commercial business, a lot of commercial business that's uh dependent on the economy, but it is recession resistant. And it's just a consistent performer over year, year after year, quarter after quarter. So, I think that's what investors really like about it. And if you look at it over time, it's it's done this. The most uh worrisome point I felt would have been uh labor costs, but your technology actually before AI, your technology figured out how to be able to take out some serious costs. >> Well, I think today Tara Himmer, our new chief operating officer, talked about this this joint uh partnership that we have with Caterpillar and we're building uh remotely operated and eventually autonomous heavy equipment. If you think about our heavy equipment operators, the average age of our heavy equipment operators is 52 years old. So, at some point, they're retiring out and and it's hard to hire them today. So, autonomy and and remote operations with CAD is a is a great uh alternative. >> No, it was terrific. Now, you also did something that I think people do not understand, which is that you did some incredible things for the uh the environment didn't have to be this way. You really came up with a sustainable business that turned waste into value. you now Mr. Stein your predecessor had started that and I know that was the direction the company's going but you really took it so that it it's core to your operating system >> you know these these landfills naturally produce uh gas I mean that's you know the trash decomposes and so what we've done is is build you know 22 of these plants that take that gas turn >> 22 there sure weren't that 22 when I when you took it over to >> No that's for sure yeah there might have been one >> there was one in Cam that I visited >> we built 20 over the or 18 over the last couple of years and we'll add two more uh next year. But but that it takes that gas and turns it into pipeline quality gas. And by the way, 75% of our fleet runs on natural gas. So it's a perfect circle. >> That is amazing. Now you have to deal with the high price of diesel. Can it just can it go up and up and up without at some point just turning the the making the country grow slower? >> I I don't think diesel goes up forever. I think part of it is driven by this uh you know kind of the the the war in Iran and uh diesel was up 80 cents I think so about 15% in the month of September and even when you look at our earnings I mean it's hard to recapture that in a month's time I mean we have a fuel search charge that that kind of evens out the cost with with uh the search charge but there's a lag to that and and so that's what we talked about on the call today but I I don't think diesel goes up forever in fact I think it eventually rever reverses course >> now I listened to Fed chief wars today and I think he's got very good judge data, but when I listen to you, I've got boots on the ground, empirical data, and you you seem to think that the economy is just okay. You weren't giving the economy your full endorsement. >> No, I think I think what's happened with the economy is, you know, it's been a pretty good year, but it's been in different sectors. So, tech has had a really good year. >> Uh real estate and and housing have had a bad year. So, um and I if you look at which one impacts our business more, it's clearly going to be uh you know, the housing business. Technology doesn't have a huge impact uh on our business. They don't produce a lot of recycling and trash. So, uh, the economy has been a bit mixed and the sectors that are doing well don't have as big of an impact on us. >> What about those data centers? They don't produce a lot of trash. >> Yeah. Not really. I mean, you know, the data centers uh they're good for Caterpillar's business, but uh Exactly. >> But, um, for us, they don't produce a lot of recycling, a lot of a lot of trash. They're pretty self-sufficient. >> All right. One last thing. Um, tell us a little bit about your successor. I know that I think you're young, but I realize you've been 10 years and you said that you do 10 years. I knew you wanted to give another person a chance even though you did terrifically, but how about the man who's gonna be replacing you? >> Look, I think John Morris is gonna be tremendous. He was fantastic on the call. I called him today and said, "Wow, I maybe I should have retired two years ago. You were that good." Uh he's going to be fantastic. Tara Hammer, she's going to be a fantastic uh chief operating officer. I I think the company is really set up well strategically. It's set up well from a senior leadership standpoint. I'm excited to be a shareholder from the outside looking in now. Well, I've got to tell you, you've done a remarkable job and it you made it look easy. I know it wasn't because things just kept changing and changing and changing, but uh congratulations to everything, you know, to you, to your family, and everything you accomplished because you did a great job Jim. >> Well, thank you very much, Jim, and it's been tremendous getting to know you and thanks. >> Ah, you're very kind. Well, that's Jim Fish. He's the CEO of of WM. A remarkable record and a remarkable company. We have money's back from the break. Coming up, you've got questions, Kramer's got the answers. Get charged up for a fast fire lightning round. Next, it is time. It's time for the light round. You say no. Byebye. The course done my step. Play the sound and then the lightning round is over. Are you ready tax on the light run? Let's start with Carl in Indiana. Carl, >> hey. Good afternoon, young man. Thank you. Um, well, my stock uh meant a lot more when uh I proposed last week, but regardless um of the activity the last week, my stock is down and has done nothing uh since I bought it. I feel like I'm riding a dead horse and I should shoot it and buy Coca-Cola. My stock is Broadcom. >> Well, Broadcom has been one of the greatest performers of all time, but so is Coca-Cola. I wouldn't shoot Broadcom and I would buy Coca-Cola. How about we go to Scott and see Scott? Scott in California. Scott in California. >> How you doing, Jim? >> I'm doing well. How are you? >> I'm doing great. Hey, what do you think about C Limited now that it's down around 7475 a share? >> Um, no. You know, look, that's a Singapore company. I've been very negative. What can I say? I've been negative forever. >> Uh, I'm a negative guy. Let's go to Daniel in Wisconsin. Daniel. >> Oh, yeah. Jim. >> Hey, Daniel. What's up? >> Hey, I'm Dan the Brewer fan from Wisconsin. >> Okay. I'm going to a party with 30,000 of my closest friends. Um okay. >> You know, uh, God's a God's a Brewers fan, so we're doing good. >> Well, I got that big guy. He reminds me of myself. What's going on? Not really. Um, probably the least that like me of anyone. Um, so, uh, what's that? >> Uh, I'm thinking about buying beta for my wife's, uh, retirement account, >> you know, like look, I air the whole aerospace complex right now is looking so weak. I'm not going to put you in that lion's den yet. It could go, it could rally, but right now it's a lion's den. I am going to Dave in Illinois. Dave, >> Jim, thank you for all you do and Northwestern Wildcat. Booya to you. I like that. That's what I was thinking. >> Um I bought this as a spec stock last year and it's over down over 70% from its all-time high this past spring. What's going on with Planet Lance? >> I think cuz it's not making money. I mean, look, I all the concept stocks that I like right now are being shredded cuz interest rates are going higher and you're just they're not going to rally unless rates have a definitive move down. It's just it's it really is that simple. Hey, why don't we go to Bill in South Carolina. Bill, >> hi Jim. You rock. Hence. >> Oh, really? Thank you. >> Hence. >> Yeah. So, hence knife river KN&F. What do you think? >> Um, you know, look, if you're going to be in that game, you got to be in in Martin Marriott of Materials. It It's pretty simple. That's my That's my idea for that stock. Uh, now we're going to go Oh my god, another one. Dave in Illinois. Dave >> Dr. Kramer, two words, my good mad friend. Dub Bears. Well, those are two very good words. I don't Sometimes I wish I was born in Chicago, but you know, then again, I got high roseman in Philadelphia and we're doing just fine. Although, another guy went on injured reserve just now, a second ago. Another running back. I am going to have to on Sunday night, you're going to see me suited up. I can run. I can break tackles. All right, I can break. They call me They call me Scatter Kramer. Okay, what's going on, >> Jim? Last May, you pointed out Vicor Corp is an emerging AI infrastructure winner. Five months later, a consistent performer. Jim, is VICR still a winner? >> You know, yeah. Yes, it is. I I you know, the these stocks because it's a high multiple stock, Dave, you know, cuz the it sells at 52 times earnings. People don't want it anymore. Multiple contraction. That's what's happening. Multiple contraction. And that, ladies and gentlemen, version of the LIGHTNING ROUND. THE LIGHTNING Round is sponsored by Charles Schwab. Coming up, Kramer is keying in on SKH Highix's report for clues that other data center stocks are set to rally next. SK Heinus put on a clinic last night about how you can get your stock to move higher. Something a bunch of tech companies this evening sure need to return to form for. If you don't know SKH is the world's second largest supplier of DRAM, the basic memory semiconductor that's crucial to the data center's information retrieval process, sitting behind Samsung and ahead of Micron. More importantly though, SKH Highix is the number one supplier of high bandwidth memory, HBM. That's a type of memory that's most in demand for AI data centers. They have a DOM position, HPM. They got a market share north of 50%. Highness is probably the the most important company you've never heard of. It is a South Korean giant and it is beating heart of the data center, perhaps even more so than Nvidia because if you are using any number of Nvidia's rivals now, you still need DRAMs. You still need stuff from these guys. If the stock of Hinx is up overnight, there's a really good chance the whole American chip complex is up. And that's what happened today after the company's overnight report. Right now, there is tremendous skepticism about the data center. They are viciously unpopular. We know that they cost a ridiculous amount. There are companies that have been created just to build them that might not be around in a couple years. These flaws have coalesed to make it so that when a complex a company complex, no matter how good the numbers are, there's still a chance that the stock might go down. witnessed Gernnova today which couldn't rally despite a very good quarter this morning. Although I found the market's judgment rather capriccious if not downright wrong although Oracle a builder of data centers told a good story today at his meeting and they're talking about capping costs and becoming more profit profitable than people thought. But the king of reporting is now SK Highness which is why I want to take you through their clinic to show you what it takes to rally in this market big time. First, the stock of Hinx has ridiculously low PE multiple with the South Korea listed shares trading for just three times next year's earnings estimate. Now, I teach how the market arrives at PE multiples and how to make money in any market. And Highex has a multiple that shows you people don't believe the good times can continue. So far, they're wrong. So, a low multiple is a great place to start. I make a mental note of that because we own for the Charitable Trust Micron, which trades for less than five times next year's earnings. Not as low as the unnatural three, but plenty low enough. That makes me think that maybe Mike Grunk could have a realistic pin action move off of Heinix. Very positive. Second, you need a big beat on revenues and margins. Highness succeeded in revenue projections by roughly 6%. That's a real trouncing. Gross margins were an outstanding 85.7%. She usually looking for 84%. Uh that's and that was a high bar. So count it as a cherry on top. Hyen is also guided for accelerating shipment growth expecting mid 20% growth for this quarter up from 10% in the third quarter. Accelerating growth is like catnip to growth investors. It lets their imagination run wild on how good things could get. He said the demand was so strong that the company's effectively sold out through 2029. It has long-term arrangements with a growing number of customers. That's something that Micron has too only more bigger deals with lots of room to make even more if the spot market stays hot, which Micron thinks it will. Highex paired that outlook with approximately 75 billion dollars in shareholder returns this year, including over 20 billion in dividends and more than 45 billion in buybacks. That's something I am concerned about with Micron. They have a deal with the federal government not to do a big buyback until after December 9. If Micron is going to roar, it should indicate an even bigger buyback plan well before its next report, which will be after that that date of December 9. And Highinness wants to buy a ton of semiconductor capital equipment. Now, in the old days, it was a sin for these companies to buy more equipment because prices would then top as production reach equilibrium with demand. This time, demand is so strong, so powerful that Heinix knows that more supply won't save the market. That shows a level of confidence that I find extraordinary. If you get through that gauntlet, then this market says you got a winner. SK Heinex's US listed shares rallied more than 13% today. And I bet that signals that Micron will be more of the same, making it a buy despite its already terrific track record. Something to think about as the whole tech complex save Microsoft looks mighty ugly going into tomorrow's session. I like to say there's always a bull market somewhere and I promise you I find it just for you right here on Mad Money. I'm Jim Kramer. See you tomorrow. >> All opinions expressed by Jim Kramer on this podcast are solely Kramer's opinions and do not reflect the opinions of CNBC or its parent company or affiliates and may have been previously disseminated by Kramer on television, radio, internet, or another medium. You should not treat any opinion expressed by Kramer as a specific inducement to make a particular investment or follow a particular strategy, but only as an expression of his opinion. Kramer's opinions are based upon information he considers reliable, but neither CNBC nor its affiliates and or subsidiaries warrant its completeness or accuracy, and it should not be relied upon as such. To view the full MadMoney disclaimer, please visit cnbc.com/madmoney disclaimer.