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Jim Cramer's Top Takeaways for Today's Trading

Strategic Insights

— 2 min read

In an exclusive interview, Jim Cramer sat down with Steve Ells, founder and co-CEO of Chipotle Mexican Grill (CMG), and Monty Moran, co-CEO, to discuss the company's E.coli outbreak and its efforts to address the issue. Cramer also spoke with Strauss Zelnick, chairman and CEO of Take-Two Interactive (TTWO), about the video game maker's shift towards a more sustainable business model. Additionally, Cramer offered his thoughts on which tech stock, Salesforce.com (CRM) or Microsoft (MSFT), is a better investment option for different age groups.

Key Takeaways:

  • Chipotle (CMG) has yet to determine which ingredient was tainted with E.coli, but has closed 43 stores out of an abundance of caution and is doubling down on food safety efforts.
  • The company aims to become years ahead of current food safety standards and is working with industry experts to ensure this goal is met.
  • Steve Ells, co-CEO, assured viewers that there is no E.coli at Chipotle today, and the chain is committed to making it the safest place to eat.
  • Take-Two Interactive (TTWO) has evolved to a hit-driven model to one that can make money even between new releases, with 40% of its revenue in the last quarter stemming from content delivered digitally.
  • Strauss Zelnick, CEO, stated that the company has been fortunate to have one new hit title every year since 2007, contributing to its success.
  • Cramer concluded that Chipotle's stock has bottomed and is confident in the company's future, citing the chain's efforts to address the E.coli outbreak and improve food safety.
  • Take-Two Interactive (TTWO) has a 20% gain in shares since mid-August, while Salesforce.com (CRM) boasts a 33% increase for 2015 but trades at a 78 times earnings valuation.
  • Microsoft (MSFT) offers a nice dividend and trades at a relatively low 18 times earnings, making it a more attractive option for older investors.

Statistics:

  • Chipotle (CMG) has closed 43 stores due to the E.coli outbreak.
  • Take-Two Interactive (TTWO) has seen a 20% gain in shares since mid-August.
  • Salesforce.com (CRM) is up 33% for 2015.
  • Take-Two Interactive (TTWO) generates 40% of its revenue from content delivered digitally.
  • 40% of Take-Two's revenue in the last quarter stemmed from content delivered digitally.
  • Microsoft (MSFT) has managed gains of 21% so far this year.

Sources:

  • "Chipotle Will Change How It Prepares Food, But That Shouldn't Lessen Its Appeal" by Scott Rutt, TheStreet, http://www.thestreet.com/story/13399599/1/chipotle-will-change-how-it-prepares-food-but-that-shouldn-t-lessen-its-appeal.html
  • "Culture, Arrogance Poisoned Chipotle, Long E. Coli Outbreak" by Scott Rutt, Real Money, http://realmoney.thestreet.com/articles/12/11/2015/culture-arrogance-poisoned-chipotle-long-e.-coli-outbreak
  • "Take-Two Interactive Software (Ttwo) Down in After Hours Trading" by Scott Rutt, TheStreet, http://www.thestreet.com/story/13263704/1/take-two-interactive-software-ttwo-down-in-after-hours-trading.html
  • "Take-Two Interactive Software (Ttwo) Stock Rises in After Hours Trading on Earnings Beat" by Scott Rutt, TheStreet, http://www.thestreet.com/story/13354918/1/take-two-interactive-software-ttwo-stock-rises-in-after-hours-trading-on-earnings-beat.html
  • YCharts, http://ycharts.com

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