Mad Money w/ Jim Cramer Mad Money w/ Jim Cramer 5/14/25
24 snips
May 14, 2025 Explore the effects of rising interest rates on dividend-paying stocks and the challenges faced by established firms. Delve into the balance of dividends versus economic risks for major companies like AbbVie and Johnson & Johnson. Discover the significance of AI in defense and tech, particularly through Cadence's partnership with NVIDIA. Assess the software industry's need for R&D in tough times, alongside Reddit’s unpredictable stock performance. Finally, evaluate the pitfalls of speculative stocks and gain insights into prudent investment strategies.
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Rising Rates Crush Dividend Stocks
- Rising interest rates hurt dividend-paying stocks despite their value appeal.
- Investors prefer risk-free bonds with yields exceeding 4.5%, pressuring these stocks lower.
Pharma Stocks Under Pressure
- Bristol Myers faces a patent cliff but offers a 5.6% yield for patient investors.
- AbbVie is safer, no patent cliff, with strong franchises, making it attractive at a 3.7% yield.
Avoid Low-Yield Consumer Stocks
- Avoid Procter & Gamble and Colgate despite their strong brands due to low yields under 3%.
- Yields don't compensate for risk when interest rates rise, so wait for better entry points.