• Subscribe
  • Log In
  • Home
  • Daily Diary
  • Asset Class
    • U.S. Equity
    • Fixed Income
    • Global Equity
    • Commodities
    • Currencies
  • Sector
    • Basic Materials
    • Consumer Discretionary
    • Consumer Staples
    • Energy
    • Financial Services
    • Healthcare
    • Industrials
    • Real Estate
    • Technology
    • Telecom Services
    • Transportation
    • Utilities
  • Latest
    • Articles
    • Video
    • Columnist Conversations
    • Best Ideas
    • Stock of the Day
  • Street Notes
  • Authors
    • Doug Kass
    • Bruce Kamich
    • Jim Cramer
    • Jim "Rev Shark" DePorre
    • Helene Meisler
    • Jonathan Heller
    • - See All -
  • Options
  • RMPIA
  • Switch Product
    • Action Alerts PLUS
    • Quant Ratings
    • Real Money
    • Real Money Pro
    • Retirement
    • Stocks Under $10
    • TheStreet
    • Top Stocks
    • Trifecta Stocks
  1. Home
  2. / Investing
  3. / Industrials

Cramer: Worried About That Weak FANG? Try Some Old CANDIES

I was pleasantly surprised to see that the candies are still crushing it.
By JIM CRAMER
Jun 08, 2017 | 05:38 AM EDT
Stocks quotes in this article: CMG, AAPL, NFLX, DECK, ISRG, ESRX, CRM, ANTM, DPZ

It wasn't always FANG! Before FANG there were the CANDIES, another acronym I created -- this one coined back in 2010 for another group of growth stocks that just wouldn't quit.

I'm so sick of hearing about how FANG's finished, crushed, over, roadkill, that I decided to dust off the CANDIES to see how they are doing. I was pleasantly surprised to see that the candies are still crushing it, too.

What are the CANDIES? Chipotle (CMG) , Action Alerts PLUS charity portfolio holding Apple (AAPL) , Netflix (NFLX) , Deckers (DECK) , Intuitive Surgical (ISRG) , Express Scripts (ESRX) and Salesforce.com (CRM) . How have they done since I anointed them? They are up 282% vs. 120% for the S&P 500.

How did I pick them? They were the growth stocks for the moment. But oddly, they remain eerily relevant today. Chipotle, up 210% since inception -- and you can only imagine how much it could have been up before the food spoilage incidents -- has rallied 22.5% this year. Apple, up 313%, has zoomed 34% so far in 2017. Netflix is the big winner, having soared 936% and 33% this year.

Deckers? It's a disappointment: up 37% since the CANDIES were launched and 27% this year. Intuitive Surgical surprised me that it isn't up more, especially because of how good it is, plus 176% -- but it's added 47% this year. Express Scripts is the real stinker. This drug middleman is only up 17% since the 2010 inception and actually down 12% for the year. Salesforce has been so solid, gaining 284% and 33% respectively.

Let's go over why I chose them and see what methodology worked and what was flawed. Chipotle at the time had been the most highly valued restaurant chain. It was putting up the best comparable sales numbers of anyone in the cohort and its unit economics -- store value -- were the best. There were never enough Chipotles, and its highest quality problem was that the lines were too long. It's been 15 months since the last outbreak and the stock's been doing what it should be doing, rallying as people forget the past. But it's been a tough slog.

I tired of reading about Apple's lack of innovation since Steve Jobs died. Jobs lived a little more than a year after the CANDIES were launched and the stock did go from $35 to $55, but that's a far cry from its 313% gain. Given that Walter Isaacson, Jobs' biographer, has said that he didn't leave that much on the drawing board, I think Apple's innovated well beyond what anyone else has done in the consumer space, and the quality has only improved.

Netflix? I picked it because my kids were cord cutters and turned me on to it as something to do together. I wish I could say more was behind it. But like Apple, I was just attuned to what they were saying.

Of course, that doesn't always work. They loved Uggs, too, and when Oprah Winfrey endorsed them I got on board. But the company was never able to develop a second lasting concept, and its stock is only up now because of takeover rumors.

Intuitive Surgical has parlayed its Da Vinci machine into multiple markets and is beloved by hospitals as a selling point for patients who can choose where they want to go.

How about Express Scripts? It's a pharmacy benefits manager, which has become a widely reviled middleman and lost its biggest client, Anthem (ANTM) , which will do it every time. Finally, Salesforce was the cloud pioneer back then, and still is for a host of new business lines.

Conclusions? First, this market, like all markets, has a fascination with growth. It never mattered how expensive that growth was, as long as it didn't stop growing, as Deckers and Express Scripts did.

Second, you can listen to your kids, but you have to do your homework. I get a ton of ideas from my kids, including Chipotle, Dominos (DPZ) and Apple, but they lost their love for Uggs and you had to swap out of it a long time ago, even as their love for Apple and Netflix burns strong. Chipotle? One's back, the other's not. Pretty typical.

Finally, I get angry when I hear these jeremiads about single stock risk. With the exception of Express Scripts, these were all right in front of you, available to all. A buy and homework rap would have made you a ton of money. Don't be scared to buy what you know, as long as you don't stick your head in the sand after doing so.

Get an email alert each time I write an article for Real Money. Click the "+Follow" next to my byline to this article.

Action Alerts PLUS, which Cramer co-manages as a charitable trust, is long AAPL.

TAGS: Investing | U.S. Equity | Industrials | Technology | Consumer Staples | Healthcare | Markets | Consumer | Economy | How-to | Jim Cramer | Risk Management | Stocks

More from Industrials

There's No Way I'm Ready to Sell General Electric

Stephen Guilfoyle
Mar 8, 2021 11:08 AM EST

There's a whole lotta lovin' going around this name.

Here's the Boeing Trade I Made Today

Timothy Collins
Feb 24, 2021 12:06 PM EST

I love this chart and I'm woefully underexposed in this area.

Caterpillar Is Ready for Further Gains After a Shallow Correction

Bruce Kamich
Feb 23, 2021 1:36 PM EST

Here's where there might be a buying opportunity.

Whether Active or Passive, These 2 Deep-Value Portfolios Are Shining

Jonathan Heller
Feb 22, 2021 10:30 AM EST

Four months in, the 2020 Triple Net Active Versus Passive Portfolio experiment is proving to be a rewarding experience.

Screening for Quality Defensive Stock Plays Yields a Woefully Small Bunch

Jonathan Heller
Feb 19, 2021 11:00 AM EST

The pickings are slim when it comes to stocks that can meet the stringent standards of a stock screen based on Benjamin Graham's principles.

Real Money's message boards are strictly for the open exchange of investment ideas among registered users. Any discussions or subjects off that topic or that do not promote this goal will be removed at the discretion of the site's moderators. Abusive, insensitive or threatening comments will not be tolerated and will be deleted. Thank you for your cooperation. If you have questions, please contact us here.

Email

CANCEL
SUBMIT

Email sent

Thank you, your email to has been sent successfully.

DONE

Oops!

We're sorry. There was a problem trying to send your email to .
Please contact customer support to let us know.

DONE

Please Join or Log In to Email Our Authors.

Email Real Money's Wall Street Pros for further analysis and insight

Already a Subscriber? Login

Columnist Conversation

  • 11:38 AM EST GARY BERMAN

    The INDU and DIA

    FIBOCALL: The INDU index and the DIA The INDU ...
  • 10:44 AM EST JAMES "REV SHARK" DEPORRE

    This Weekend on Real Money

    "The Challenge of Short-Selling"
  • 08:40 AM EST PAUL PRICE

    Recent Pick SpartanNash (SPTN) Raised Its Quarterly Payout by 3.9%

  • See More

COLUMNIST TWEETS

  • A Twitter List by realmoney
About Privacy Terms of Use

© 1996-2021 TheStreet, Inc., 225 Liberty Street, 27th Floor, New York, NY 10281

Need Help? Contact Customer Service

Except as otherwise indicated, quotes are delayed. Quotes delayed at least 20 minutes for all exchanges. Market Data & Company fundamental data provided by FactSet. Earnings and ratings provided by Zacks. Mutual fund data provided by Valueline. ETF data provided by Lipper. Powered and implemented by FactSet Digital Solutions Group.

TheStreet Ratings updates stock ratings daily. However, if no rating change occurs, the data on this page does not update. The data does update after 90 days if no rating change occurs within that time period.

FactSet calculates the Market Cap for the basic symbol to include common shares only. Year-to-date mutual fund returns are calculated on a monthly basis by Value Line and posted mid-month.

Compare Brokers

Please Join or Log In to manage and receive alerts.

Follow Real Money's Wall Street Pros to receive real-time investing alerts

Already a Subscriber? Login