- Bristol-Myers Squibb CEO Giovanni Caforio tells CNBC's Jim Cramer that the $74 billion bid for Celgene is a strategic move.
- "It creates the number one company in oncology, number one cardiovascular franchise, very strong presence in autoimmune diseases," he says in an interview on "Mad Money."
- Cramer explains why investors ditching retail stocks might be playing into a number of those company's hands.
Bristol-Myers Squibb BMY CEO Giovanni Caforio defended his company's $74 billion bid for cancer drug maker Celgene CELG in an interview with CNBC's Jim Cramer on Wednesday.
The move is facing opposition from the Wellington Management, Bristol-Myers' largest stakeholder, and Starboard Value hedge funds. The acquisition, which will be voted on by shareholders next week, would add a large load of debt to the company's balance sheet.
The rationale of the merger is a strategic one, Caforio said.
"It creates the number one company in oncology, number one cardiovascular franchise, very strong presence in autoimmune diseases," he said on "Mad Money." "It generates value for shareholders from day one and it provides a path to sustainable long-term growth for Bristol-Myers Squibb."
If the deal gets approved, the chief expects to launch six new medicines within 24 months.
Listen to Caforio explain why this deal is important for the company here
FOBS is the new FOMO
Stockholders have been hit with a new syndrome and it's causing U.S. major markets to descend after a strong start to 2019, Cramer said.
And the new phenomenon has taken the place of FOMO or fear of missing out on stocks going higher, he added.
"Boy, those were the days. We sure don't have FOMO anymore, do we? Instead, after another ugly session ... we've got FOBS, fear of big sellers," the host said. "And that FOBS is putting pressure on the whole market."
In Wednesday's session the Dow Jones Industrial Average lost about 133 points, the S&P 500 declined 0.65 percent, and the tech-heavy Nasdaq fell less than 1 percent. The Dow Jones and S&P recorded their sixth negative closes in seven, while the Nasdaq had its fourth in five.
Click here to find out what's triggering fund managers to dump stocks
Investing in the family
Dollar Tree DLTR 's turnaround plan is producing results as more customers are choosing to shop in its stores, CEO Gary Philbin told CNBC Wednesday.
The company met earnings and revenue expectations, and beat on same-store sales with 2.4 percent compared to the 1.4 percent gain that Wall Street was looking for. The stock added more than 5 percent in the session and is up about 11 percent this year.
The company has invested $1 billion to renovate its Family Dollar stores to give it a "wow" factor and the entire enterprise was able to generate about $2 billion of cash flow, Philbin said in an interview with Cramer.
Find out how Dollar Tree is giving stores a "wow" factor here
Don't let Amazon scare you
Every time Amazon AMZN seeks to enter a new industry, stocks in that particular sector drop dramatically, Cramer said.
"This drives me nuts because, more often than not, these pullbacks turn out to be buying opportunities once we learn Amazon's buildout will take longer than expected, or the market's big enough for multiple winners, or the damage to the competition simply isn't as bad as we thought," he said.
The e-commerce giant announced last week that it plans to launch another grocery concept separate from Whole Foods, and a number of grocery stocks tumbled. But Cramer said investors are probably "kicking" themselves for not buying the weakness as names like Target TGT soared after reporting a strong quarter.
Kroger KR and Costco COST both deliver their latest earnings report on Thursday. Cramer suggests making a wise move.
Listen to Cramer's assessment of grocery stocks against Amazon's plans here
A new kind of return policy
A number of retailers bought back stocks aggressively during the December sell-off to take advantage of weakened prices, Cramer said.
These retailers are still buying stocks and shareholders that are selling their stakes are likely returning it right back to the company, and it's been going on for years, he said.
Cramer pointed out that Home Depot HD bought about $4.5 billion worth of stocks in the fourth quarter, Target cut its outstanding shares from 635 million to 519 million over the last five years, and Ross Stores ROST shrank its share count by about 15 percent over the same time frame.
Target, he said, is also investing billions into its digital landscape and adding small-format stores in major cities. Home Depot has also been putting money into its locations, he said.
Are they concerned about the future?
Click here to hear Cramer's take on these and other retail buyback programs
Cramer's lightning round: This stock has doubters, but it's pretty good
In Cramer's lightning round, the "Mad Money" host flies through his thoughts about callers' favorite stock picks:
Funko Inc. FNKO : "We like Funko very much. Why do we like Funko? Because they had a blowout quarter and I know it's got its doubters and short sellers, but I think it's actually pretty good."
Turning Point Brands Inc. TPB : "You know, I'm gonna say something bad. And I don't mean to because I'm not recommending the stock, but when [Scott] Gottlieb, whom I loved [at] the FDA, when he left it was really great news for tobacco. Because this man was on a mission. We have so many people dying of lung cancer in this country, and he wanted to stop it. He's a great man and that's why Turning Point has been strong, and that's just terrible. I don't want to recommend a tobacco stock. Didn't mean to the other day when I did 'Off the Charts,' that was someone else and I used their chart."
Sirius XM Holdings Inc. SIRI : "Stock has lost it's mojo. Sirius has lost its mojo, why? Because auto sales have lost their mojo. I've been behind this since it was an itty-bitty baby. I am losing patience. We need to see car sales pick up, or sell."
Disclosure: Cramer's charitable trust owns shares of Amazon, Home Depot, and Amazon.
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