Video: Jim's Daily Rundown for Wednesday

In today's Daily Rundown, Jim Cramer discusses the markets, American Eagle Outfitters (AEO) , Ford (F) , Costco (COST) , Amazon (AMZN) , Apple (AAPL) , Nucor (NUE) , Cisco (CSCO) , Union Pacific (UNP) , Estee Lauder (EL) , and more!

JEFF MARKS: Good morning, everyone. I'm Jeff Marks, standing on the floor of the New York Stock Exchange with Jim Cramer. This is The Daily Rundown video, exclusive for our Action Alerts Plus subscribers.

Jim, I don't know if there's really a feel to the market today. We are seeing the markets higher again.

JIM CRAMER: Right.

JEFF MARKS: Another green day. We've sidestepped that seasonally weak period that we saw last night, or last week. Excuse me. And the markets are higher today.

JIM CRAMER: Right, and obviously we pay attention to that proprietary S&P oscillator, which is negative. And we know that going into July 4 is a terrific time.

We've got some stocks that have come down as of last week, and we like to be bigger in them, which we've certainly got the cash to do it. And I really feel strongly that when you get a stock like American Eagle Outfitters, which I talked about last night on Mad Money any time that stock is down you want to buy it. Because it's just such a compelling story with that child credit coming up, which is going to lead to an unbelievable back to school session. And AEO is probably the biggest beneficiary of back to school.

JEFF MARKS: Right, that child credit, $3,600. It gets paid out in monthly installments starting in July through December. So we were just talking before this, it's just another form of stimulus that may be overlooked. And it comes at a perfect time as we're going to start seeing these back to school shopping deals. They're going to start coming in the next few weeks. So that's why it's a great time to buy AEO now before everyone starts talking about how big it's going to be.

JIM CRAMER: Right, and look, PVH just reinstated the dividend. This is a group to buy for back to school. And the number one back to school play in the country is AEO.

JEFF MARKS: Right, leading position in jeans, jeans of all ages.

JIM CRAMER: Yeah, right. It is so important. I mean, it's very interesting. You look at the branding. You'll see it used to be very branded about with an eagle over the American Eagle Outfitters. Now it's called AEO. And one of the reasons is because Aerie is so incredibly good.

And my kids just love this Aerie so much. And that's where it was first brought to my attention. It's like one of my daughters just said, dad, the Aerie stuff is the best there is. And I'm like, Aerie?

And then Matt Boss comes out with great stuff about American Eagle. And we've been waiting, and waiting, and waiting for it to come down a little bit. It came down a little, and we pounced.

JEFF MARKS: Yeah, Aerie, 26 straight quarters of double digit growth. Great positioning in activewear, athleisurewear, loungewear, all really the hottest trends in retail.

JIM CRAMER: Yeah.

JEFF MARKS: And Aerie, actually at their investment day for AEO, earlier this year they thought that Aerie could hit $2 billion in sales by 2023. They're moving that up to 2022, just because it's so strong right now.

JIM CRAMER: It's incredible. Look, we saw what happened with Victoria's Secret. That came back. Bath and Body Works was never doing badly.

There are definitely signs that the A malls are back. And Aerie's in the A malls. And it is where young people buy their stuff.

JEFF MARKS: Now, American Eagle Outfitters was one of the five low effort stocks you talked about last night on Mad Money. I want to hit through the other four.

JIM CRAMER: Sure, go right ahead.

JEFF MARKS: There all Action Alerts Plus names.

JIM CRAMER: Yeah, look, I mean, one of the things I try to do on Mad Money is deal with the companies that we've done the most research on. And the reason I said that these were-- nothing's a no brainer, but less brain is because we've spent so much time on these stocks. We understand, for instance, Costco.

OK, so you could say, well, listen, Costco. Jim, you're buying Costco near the high. Well, Costco is a buy because it's timeless, right? It's about membership gains. They are in very few places in the country. Really, remember, in very few stores.

I had Boxed on the other day. And Boxed said one of the reasons why they can do well is because Costco is only in certain markets, smaller markets. And China awaits them. The prices are great. They're back selling things that-- like boomers need hearing aids. Hearing aids are a fortune, not at Costco.

The sampling is coming back at Costco. It's fun again. And so Costco's very easy to me. Ford, the chip shortage is easing. It's easing ahead of when Jim Farley talked about. I think that's very, very important.

And you know, the chip shortage was going to clip them for $2 billion. And it's not going to clip them for $2 billion. So I like that. Obviously, I went through and tried to figure out a lot of other names. Do I do Bristol-Myers? But I decided to hold off on that.

JEFF MARKS: We've been sellers into strength on Bristol Myers, so that makes sense.

JIM CRAMER: Yeah, do I do Wynn? I'm worried about China a little bit, but I do think that Wynn is right. Do I do Union Pacific? We like that one too.

JEFF MARKS: Added today to our position.

JIM CRAMER: Estee Lauder is very good because there's going to be travel. Travel is back and they do a lot of duty free. But I was thinking about Walmart because it's down so much from its high.

JEFF MARKS: But Amazon and Apple were the other two.

JIM CRAMER: But I gave up, and in the end, decided I need FAANG names. I almost did Facebook too.

Amazon was so unbelievable for the bargains. And by the way, again, on Monday there was a story which said that-- a lot of stories came out and said, listen, you're not going to get your things. But if you go look at the dates of when you're going to get it, that's proven completely false.

Apple, a new iteration. You got Toni Sacconaghi saying, well, look, they've got a new phone cycle. It's when you buy it. Of course, in the end, said don't buy it. He is really hard to deal with.

But Apple, service revenue stream. Apple has a very good letter out today about why there should not be a crackdown on them. And so I went with the easy, because, in the end, I think the estimates are too low for Apple, and the estimates are too low for Amazon.

JEFF MARKS: I just want to do a couple more quick hits on those five stocks. Costco, you mentioned the membership.

JIM CRAMER: Number's too low.

JEFF MARKS: We're actually about a year away from seeing them actually raise prices on their membership fees. And we know that's all profits for Costco, which is excellent.

JIM CRAMER: Oh, my, well, Costco, I mean, when you look at it, I think the Apple+ and all your Apple revenues, you're being charged very little for those. I think that Prime is one of the great bargains ever. And Costco, the executive card is ridiculous how much you save.

So I love subscription models. I've loved them ever since I started TheStreet.com in 1995 with the idea that subscription is the single greatest way to make money. I've been after all companies that have subscription models. And a lot of them are doing them.

JEFF MARKS: Now, Ford we talked about yesterday the chip shortage coming to an end. Report out of the DIGITIMES today saying carmakers, they could be seeing-- or the chip suppliers could see 30% increase from what they previously expected.

And when I think about the chip shortage coming to end, I think that's also going to be a tailwind for Nucor, because so much steel goes into auto production.

JIM CRAMER: Yeah, I mean, look, Nucor, we said-- and I'm conscious of where we bought our first Nucor. But we said that Nucor has multiple years when it goes up. So I'll buy it all the way down. I don't give a damn.

But yeah, I mean, a lot of it goes into cars, cold rolled. And if you have the chip shortage solved there'll be many more. They could do 19 million units. That's very bullish.

JEFF MARKS: All right, now you talked about earlier subscription just had a great business model. You used it for TheStreet. Now, we added to a position yesterday that is also going through their own transition to software, to subscription sales, and that's Cisco, another stock that is still very much under loved, we think, with that teen price to earnings multiple.

JIM CRAMER: I remember speaking to Chuck Robins on TV. And you know, we thought the stock was going to go up, because the way you value that one is orders. And you can also see the software go $33, $34. It was going there steadily.

JEFF MARKS: Great progress.

JIM CRAMER: But no one focused on that. They're just looking at the earnings per share.

Now, look, I don't blame everyone. Earnings per share is important. But this one's measured on orders. And the orders were great. And I want to contrast that with, see-- look at Oracle. Oracle had a blowout number. But what you saw in the forecast wasn't that good. So Oracle plummeted.

Cisco should have been up as much as Oracle went down. So I think Cisco is really the most undervalued of many of the companies we talk about. Cisco may be the most undervalued tech stock there is.

JEFF MARKS: All right, so we hit on some of our recent buys, AEO earlier, Cisco just now, Nucor this morning. And we also bought Union Pacific this morning.

And there was a nice push out by RBC Capital. They raised their price target to $254 [$259], saying UNP is the best positioned rail heading into second quarter earnings season. It is a stock that's lagged. But we're also at a price now that's below that accelerated share repurchase that they announced just a few weeks ago.

JIM CRAMER: They have a lot of cash. They love their own stock. They buy, buy, buy. Obviously people feel they're being hurt by the problems with the ports and China having a bad COVID problem. Remember, the vaccine in China doesn't really work well. It's only 50%. So that's why you're getting these outbreaks.

I think you take a longer term view on Union Pacific and just say, look, this is the way that we get-- we're not going to take-- they're not taking the ships and going to Baltimore. They're not. And they're not going to Philadelphia. They're going to those ports that Union-- I mean, anyone who's lived out West-- I mean, I lived in Sacramento. That's a Union Pacific town.

The South of California, Union Pacific. So you're going to get all of that, all those goods traveled by Union Pacific. Remember, these are monopolies.

JEFF MARKS: And just thinking about e-commerce, obviously UPS one of the big beneficiaries there. But

Union Pacific is too with that intermodal business.

JIM CRAMER: It's fantastic business. I mean, Mexico's really great. By the way, FedEx reports. And I think that people are going to say-- I think it's going to be a good number. Barclays's has a piece out today saying it'll be a good number. And I think that's going to reflect well on UPS. And we're going to start really questioning why people sold off UPS, which is why I said buy it.

I feel like some of these stocks, like Microsoft, when they come down you got to buy them. We've broken price on some stocks because they've had these downturns. And you have to do it, Salesforce. Because you rarely get a break in these stocks. So when we do get it, we don't shy away from putting more money to work.

JEFF MARKS: All right, before we go today, we've put a lot of money into the market the last few days, $75,000 yesterday, another $25,000 this morning.

JIM CRAMER: And you know I'm pushing for Estee Lauder. I'm pushing for Estee Lauder because when things open up, they open up. And when you take the masks off in America-- now, America is not a big part of Estee Lauder as it used to be. But when you take the mask off, you get made up.

JEFF MARKS: So what do you think, Jim? We talked about Estee Lauder last Thursday on our monthly members call. The replay is available, if you haven't checked it out, with the transcript.

We added Estee Lauder a little under $300. It's trading about at $300 now. So what do you think?

JIM CRAMER: I mean, we go back and forth all the time. I mean, I always like to show you how we play open handed with Zev Fima too.

And this is a little-- look, we don't have tension. But this is one where I often talk about how you got to take a stock out when you put one in. I'm conscious that we took Disney out.

And again, I think Disney can come back. And we're waiting to see if the narrative changes, because I think that the parks are fantastic. But I am itching to buy more EL. But it's one of these things that, well, I don't have an edge to do it right now, Estee Lauder. Why not just wait till it comes in a little. And that's what you've been saying.

You can't just like wake up in the morning and say, ooh, today's my Estee Lauder day. You have to wait. And it kills me to wait. Because the natural instinct is to say, I know this is the right price.

But you don't want to run into a Nucor where you say, I know it's the right price. Because we make mistakes. We talk about it. Estee Lauder will be less problematic if we can get it at $295 or $297.

JEFF MARKS: All right, so that's going to be the next stock that is on our radar to add to our position too. That's the show for today. I'm Jeff Marks. We'll see you tomorrow.

Action Alerts PLUS, which Cramer co-manages as a charitable trust, is long AEO, F, COST, AMZN, AAPL, NUE, CSCO, UNP, EL.