Be very careful with the Luckin Coffee IPO

Jim Cramer, of CNBC, revealed Monday that he had a "go-ahead" for the Luckin coffee, which had just been made public.

Indeed, the initial public offers of Chinese companies have been too painful, he said. Luckin, the Beijing-based chain that wants to outshine Starbucks as the country's largest coffee chain, jumped 50 percent after opening $ 25 on Friday.

The action closed Monday's session at under $ 19 per share.

"Unless we're talking about a great company with a proven track record, you have to be very careful about Chinese IPOs because this cohort has been very difficult to acquire," said Mad's host. Money ".

Of the 31 Chinese IPOs that have been listed on the US markets for the first time in 2018, 21 of these stocks are below the price of their transactions, said Cramer. Two dozen companies lost money during their first trade, he added.

In addition, the group on average lost 22% of its first exchanges, he continued.

"These are terrible chances, people, and the Chinese IPOs of the 2019 promotion have been even worse," said Cramer. "Luckin Coffee seems to follow exactly the same pattern: strong initial rise followed by a quick sell.And even here I would not be a buyer.It is too risky."

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Investors must be wary of claims that China will pay the higher tariff bill, Cramer said. On the contrary, these costs will fall to US consumers and investors should adjust their portfolios accordingly.

"As long as the president [Donald] Trump thinks it is the Chinese who pay the price, he will continue to take a harsh approach in these negotiations, which means that your portfolio should be as little exposed as possible to China, "he said.

The portfolio managers said the market was a tough place to buy stocks as Wall Street sorted security names and reassessed earnings forecasts for companies affected by the China-China trade war, Cramer said. . He also warned that the current uncertainty would be the "new standard" until the two largest economies in the world reach an agreement.

That explains the decline of about 84 points in the Dow Jones Industrial Average on Monday, the 0.67% drop on the S & P 500 and the loss of 1.46% on the Nasdaq Composite, he said. .

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Cramer ranked the leading stocks of social media.

"If you want to have some visibility on social networks, here's what you get: you have Facebook … it's number 1," said the animator. "Twitter is a distant second, Pinterest a third close, then the incoherent Snap [is] welcome to the show to tell us why they deserve to be higher in our new power rankings. "

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Video game stocks were affected by new competition that changed the nature of the sector. Take-Two Interactive saw its market share take a hit, even after launching its popular Red Dead Redemption 2 in October.

CEO Strauss Zelnick told Cramer that the video game holding company has paved the way for a new driver of growth in recurring consumer spending, which now accounts for 40% of business.

"This will continue to increase because consumers are engaged over the course of the year, not just when you have a big press release," he said.

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Cramer suggested investors focus on managed care actions as long as Joe Biden's presidential bid looks promising.

The former vice president appeared last month as the Democratic presidential candidate's favorite for 2020, Cramer said. Former US Senator of Delaware, Biden stands out from the overpopulated world of hopes and left-wing candidates in health care.

"Unlike Bernie Sanders or Elizabeth Warren or Kamala Harris, Biden is against" Medicare for all, "said the host.

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During Cramer's flash game, the host of "Mad Money" reviews his thoughts on the appellants' choice of actions.

Intrexon Corp: "It's a loser and I do not want to hear about it, I feel bad if you own it, but it's a loser.

Iridium Communications Inc .: "[CEO] Matt Desch. I thought he was doing a great job. I like the stock. There is a niche in which I did not believe. I was wrong, he was right. It's a winner. "

Wayfair Inc .: "It's a raw market and Wayfair is the type of stock that's not necessarily the best thing to buy right now." I think the company is experiencing growth phenomenal. "

Disclosure: The Cramer Charitable Trust holds shares of Facebook.