Analysis: CRM KSS HD LRCX

In today's Daily Rundown, Jim discusses his thoughts ahead of earnings from Salesforce.com (CRM) and Kohl's (KSS) (Salesforce.com will report Monday after the close, Kohl's will report Tuesday before the open), he explains this morning's initiation of Home Depot (HD) (see our trade Alert here), he talks about the selloff in the health insurance stocks, he explains why sometimes you have to buy the stocks that are hated, and more!

Plus, Jim answers club member questions about Lam Research (LRCX) and what stock he would put new money into. 

Katherine Ross: Hey y'all. I'm Katherine Ross with Action Alerts PLUS. I'm here on the floor of the NYSE with Jim Cramer. Jim, let's talk Salesforce. We got a reporting after the bell, it's kicking off this week. What do you think is going to happen there?

Jim Cramer: Well, I think Salesforce is going to have remarkable numbers, but nobody is going to care, just like the remarkable numbers with Workday. That's why we're saying, "You don't own it yet, just wait. You might get a better opportunity." I think Benioff and Block together, master stroke. The digitization ... I was working on the retailers this weekend, for a piece I did for Real Money, and lots of other things, and what's incredible is that the retailers that are winning, when you peel back the layers, you keep hearing Salesforce. Salesforce and how to stay in touch with their clients. I met Brunello Cucinelli when I was in Milan, and he's a remarkable man but his stuff is very expensive. What they try to do is keep you in the fold and know what people want. His company's very old, he's very good, and he uses Salesforce. It's kind of like, well, if you want to try to win, you need Salesforce in retail. I find this to be continually the case. So I think that short-term, someone's going to pay too much for Salesforce. Longer-term, I really want you to own it.

Katherine Ross: Okay. I'm glad that you brought up retail because Kohls is also reporting, and they report tomorrow morning. What do you expect there?

Jim Cramer: Yeah Kohls is erratic. What happened-

Katherine Ross: They were up last week.

Jim Cramer: Right. Well, that was bad. If Kohl's had been down ahead of it, I would just say buy it, but now we're out of ... one of the Rev Shark has taught us. You don't try to game the quarters and Kohl's is a not gameable situation in that Michelle Gass, who is a new CEO, very forthright. I don't want to bank on her telling a story that is necessarily going to move the stock. I think she is going to tell a story about what's really going on and that's great. And Kohls could be a beneficiary of the end of Bon-ton that's been going on. It's like a continual end of. Not unlike what happened with Toys R Us. Not unlike what happened to Sports Authority. But my problem is that there are always people who get too enthusiastic when Kohls - on the actual number. They don't wait for the call, and then, they kick the stock out. These are well established patterns. So I would just say wait till it comes down and has a better dividend, better yield.

Katherine Ross: The Street's Martin Baccardax was talking to me this morning. He brought up an interesting question that I want throw to you.

Jim Cramer: Sure.

Katherine Ross: And he was asking me if there was any correlation between JCP and Kohls at this point, with their earnings.

Jim Cramer: You know I went through the JCP conference call. They were, other than housewares and furniture, it was rather opaque about what can go right there and I didn't feel very encouraged about it.

Katherine Ross: The beat was small

Jim Cramer: Right the beat was small. Now JC Penny has a lot of mall and a lot of strip mall. I think that people look at Kohls as having big brands and they have Kohl's Cash is very good. I have some Kohl's Cash. Big brands at a discount.

Katherine Ross: Amazon.

Jim Cramer: Yes. And the Amazon...well they refuse to talk...I mean one of the things that's been very problematic about their Amazon, where they have a trial going on. Where you walk through the store and the racetrack, so to speak and you give them the package, the thing to pack and send back to Amazon. Amazon doesn't like to talk about returns. So, Kohls has not been able to tell that story. Because they haven't been able to tell that story, you don't get the kind of pop that you would expect as you're related to Amazon. Then there's so many floats, the fact that maybe Kohls could be bought by Amazon, completely untrue. And it ends up being a story that people get dissapointed in all the time. Stock is well off its' highs, which were in the 80s. If it hadn't run the last 4 points, I would say buy it even for a trade, but that is not what I'm willing to say.

Katherine Ross: Now I just teased this on our free Facebook live video, but I want you to tell everyone what position you're initiating and what stock.

Jim Cramer: OK we are doing Home Depot. And we know Home Depot is going down and that's okay. Home Depot's Black Friday occurs in the spring. And the spring selling season I think is going to be very good, judging by the fact that the consumer is doing better and we've gotten over the hump of what the Feds going to do. The spring housing season is going to be better. Home Depot, all domestic, I know in era right now where people are playing China but that's okay too. The stock has had a good quarter. I feel like better quarter than Lowes, but people like the fact that Marvin Ellison is turning Lowes around. The chink in the story might be that Lowe's is coming back. I think there's room for both. Home Depot got a good dividend. Upped the buy back and is very misunderstood right here. I think that that's, we are in a vicious whippy rotational mode and Home Depot is part of the rotation out.

Jim Cramer: Money this week is going to FANG. So we want to take advantage of what's down. We don't want to take advantage of what's running cause every time we do that, we get crushed. So I think Home Depot. We're starting a position here. We're not putting on a lot. We've got our call next week, our club call, we'll be talking about how we arrived more at this Home Depot situation. But I feel very good about it over the next 6-9 months, my timeframe on Home Depot

Katherine Ross: Alright and I've got two member questions for you and the first one is from Tom. It is loading up right now. Tom is wondering, do you believe that Lam Research still has room to run on the upside?

Jim Cramer: Yeah. Can Lam...When you see China coming back, you'll see the semis come back. I did not mention Lam this morning, see Applied Materials coming back today. I didn't mention Lam today on Squalk on the Street and maybe that was incorrect not to. Because that's very much the way that if you think that DRAMs are going to go up then, which I think they will I think they can trough your...then Lam is the way to play it. If you think that there is going to be more spending by the semis, then Lam is the way to play it. In the meantime, Lam has been sopping up a lot it's stock and its got a decent yield. So, I think that Lam, you can tell Tom that Lam is fabulous and I think it is a real good buy.

Katherine Ross: All right and Rick is wondering what is your favorite stock right now for those who are looking to put new money to work?

Jim Cramer: Well obviously we would say...you now I'm going to say CVS. Now CVS, the problem with CVS is United Health. United Health goes down every day so they have people feel you know its one of our stocks. People feel that its not a big position. It's almost where we have to start buying it. But that Aetna is therefore bad. Aetna is bad, CVS is bad, Amazon coming after the drugstores. Look all this stuff is building to a stock that has come down from 108 to 57, that the multiple has been cut in half, that Larry Merlo seems to have lost it somehow. I think that that's wrong and I feel very strongly that it - look it could go to 55. UNH could go to 230. I mean, when a group is hated in this market, holy cow. There are no buyers and the get hit by sellers of individual stocks and by ETFs so there's no support for anything. But that's one I want to buy. I'm glad to see that Home Depot is down today. That makes me want to buy. I think you have to - look McDonald's is down today, these are the soft good stocks, that are not China related.

Jim Cramer: These are what you have to buy because you have to be counterintuitive to the current rotation. If you buy the rotation, you may be buying the top. We know we are not buying the top in CVS. By the way you know I thought it was interesting, DuPont, which has been such a disaster. Because it was great and we didn't realize that both the split up would take so long and of course we got hit by China. Like DuPont is finally good off of China and no one cares.

Jim Cramer: So, there are hated stocks out there and we're buying some of the hated stocks. Now you'd say, listen Jim, you should only buy the hot ones not - we own a lot of hot ones! But I like to buy the momentarily hated. And Home Depot and CVS are so hated that I'm just drawn to them and I have to buy them.

Jim Cramer: By the way, it's very funny. On Twitter this weekend, there was a guy who obviously likes what we are doing, Action Alerts. He put up a what looked to be an insider buy for CVS and it wasn't. It was just a compensation. Thank you Jeff Marks for catching that immediately. And you feel like it's very slim read that you are hanging onto when you buy CVS and then you'll look back and you'll say, you know a year from now, "why didn't I buy CVS? Oh yeah it was an Amazon. Oh no it was UNH." That's what you have to buy. You have to buy what is so hated and I know it's hard because the market is up so much that you kind of want to buy what's hot. You know we look at Danaher today. Someone bumped the target of Danaher.

Katherine Ross: J.P. Morgan.

Jim Cramer: Yeah. I'm anxious to sell some Danaher because Danaher is a huge win for us and then rotate back into things that could be the next big winners out a year from now. We struggled with Danaher for a long time. There were two stocks that we struggled with. We struggled with Danaher and Lily and we punted on Lily after making a little bit but we kept Danaher. And Lily is at 129 today and it was unstoppable once it turned. Lily went from 79 to 129 and it just wouldn't stop. And I am betting that you will get that with CVS. That it will not stop once we clarify what's going on. Home Depot will do the same. Home Depot could touch 180. That's why we leave a little room and we'll talk about that at our teach in, at our usual club call because what I've learned in this market is that when you buy them on the way down as they go up it's just marvelous, but you have to be patient and people aren't patient. If people were buying Danaher right now...

Katherine Ross: It's the age of Twitter!

Jim Cramer: Yeah, yeah it is the age of Twitter.

Katherine Ross: So, you just gotta buy and hold right?

Jim Cramer: Yeah. I mean you know its funny my Twitter, we got our rescue dog back, Marley also known as Xilinx, which got a downgrade today. So, maybe he's back to being Marley. Doesn't answer to either one of them. He was just insane. I have to tell you for the dog lovers out there, I love rescue dogs but we took him to a place to get obedience and they must have been training him to play. So he keeps bringing dog toys to me. I'm trying to work and he just brings a dog toy to me every...

Katherine Ross: But he's not eating your pens right, so far?

Jim Cramer: No that's actually not true. He grabbed one of my black pens while I was at the restaurant at the Long - actually it was Bar San Miguel. So, when I walked in there was the black pen. The thing that he didn't do was break it open.

Katherine Ross: Oh that's good.

Jim Cramer: Yeah he didn't chew it. Lisa works almost... we took a busman's holiday and went to...after her working at Longshoreman for 5 hours, we went to Bar San Miguel for dinner on Saturday and it was just a delight to see her not have to...she was waiting you know, alright I will reveal this, she washed dishes Saturday and she washed dishes all Sunday. Now I remember when I was 16 and I was a bus boy, cause a waiter you had to be able to serve liquor, at the Block and Cleaver and, of course, nicknamed the Block and Cleavage by all the funny guys in my high-school class. And I was 16 and I was a bus boy and, then Mr. Fox at 1:00, when the place was closed, said you're washing dishes and my father suddenly appeared at the back door at 2AM, and he grabbed me by the collar, which he did a lot of, and he said to Mr. Fox "My son is a bus boy. He does not wash dishes. Washing dishes is beneath him." And it's very interesting to see my wife, I was going to tweet it but she said no, washing dishes at the LongShoreman at 1, 11:30 to 1. My late father would have grabbed her by the shirt, pulled her out. My how the mighty have fallen. Washing dishes, my wife.

Katherine Ross: But the LongShoreman...I mean she's just so it's great that she's that dedicated.

Jim Cramer: Well she's looking for, I know they want that Michelin star. I had dinner there Friday night, because she worked, and I had a really delicious Brussels Sprouts pizza.

Katherine Ross: Oh that sounds delicious.

Jim Cramer: Really good steak. I ate half and saved half for Marley, for Xilinx, when he came back from obedience school. But then I ended up giving it to Everest because I felt really bad for him.

Katherine Ross: Aww.

Jim Cramer: Yeah I don't want to favor anyone over the other. But rather remarkable turn of events that my wife is working constantly at the restaurant. And I feel very bad for her. She's washing...look! hey by the way, you know we have there's nothing beneath...I only mention it because my father felt that washing dishes was beneath being a bus boy. That these are all admirable jobs but to see my wife washing dishes in the middle of the night was off-putting. I thank heavens for The Punisher, which I went to episode 7 which is a very weak episode. But the whole things kind of surreal, my wife at this age. Good for her but team effort.

Katherine Ross: Definitely. Alright Jim we got to get you back to the office cause you got to start preparing for that call.

Jim Cramer: I was going to bus tables on Saturday. There was a group of 8 that came in, and they were very sloppy when they finished. I was going to buy them a round of beers but you know Lisa said "will you stop?" And so I ended up having to... I said listen let me bus that table, it's driving me crazy, we got people coming in. But you know what we have a great staff and they boom! They cleaned that thing very quickly and we were able to serve others. Bar San Miguel was just...In the old days, when we started, its been 5 years. I used to close it.

Katherine Ross: Congratulations.

Jim Cramer: And play music and I said look anybody want to dance? We'll dance and I bought everybody beers. Now it's a business and by the way not a soul knew me, which is just fabulous.

Katherine Ross: That's nice!

Jim Cramer: Not a soul knew who I was. I sit there on my two-top, my high, there's a high top, two-top and I watch and I took a picture of it. Very satisfied that two people did come up to me as the owner but didn't know CNBC and said "Thank you so much for keeping this place open." And the reason I said that is because the amount of restaurants that have closed because of rents going up is so extraordinary. We're now...the French place just closed, that was next to us. They were in business for 18 months. Boom. Another French place closed a couple weeks ago and a Middle-East place just closed. You can't, we're it, we're the only, we're it the only bar that's open til 1. Anyways there's just a little color.

Katherine Ross: Alright Jim we got to get you back to the office cause you got to start preparing of that call next week.

Jim Cramer: Yes I do, sure do.

Katherine Ross: Alright guys thanks for joining us. We'll see you tomorrow.

Action Alerts PLUS, which Cramer co-manages as a charitable trust, is long CRM, KSS, HD, LRCX.