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More cracks are starting appear in the Trump rally, Jim Cramer told his Mad Money viewers Tuesday, and that means that risks are developing in stocks we thought were risk free.
Cramer's cautionary words came after President-elect Trump took aim at an alleged $4 billion government contract with Boeing (BA) to build a new Air Force One. Military cost overruns are everywhere, Cramer noted, but perhaps Trump is looking to change that. Nearly 20% of Boeing's business stems from the military, giving Trump some leverage.
What does this mean for defense stocks such as Lockheed Martin (LMT) and Northrop Grumman (NOC) , which are up 22% and 30%? Cramer said these companies have great value long term, but in the short term they may be risky.
Cramer remains bullish on the banks and the oil and gas sectors, both of which are likely to flourish under Trump. He also recommended taking a second look at growth stocks such as Netflix (NFLX) .
It's a brave new world, Cramer concluded. As Trump takes aim at more companies and industries, it will only reinforce those that are not on his radar.
Executive Decision: Robert Finizio
For his "Executive Decision" segment, Cramer sat down with Robert Finizio, CEO of TherapeuticsMD (TXMD) , the biotech working on hormone replacement therapies for women. Shares spiked 12.8% Tuesday on positive Phase III clinical data, but are still negative for the year.
Finizio explained there are two hormones that decline during menopause, and his company's drug is the first to formulate both of those drugs naturally. That's why he couldn't be happier the latest Phase III results show the formulation is both safe and effective.
Finizio added that the market opportunity in the U.S. alone could be $3.5 billion to $4.5 billion a year, with additional opportunities overseas. TherapeuticsMD plans to file for FDA approval in the third quarter of 2017, Finizio said, and after an expected 10-month review, bring the drug to market.