Jim Cramer on Nokia, Chipotle and Twitter

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BB&T and SunTrust are Merging
BB&T and SunTrust Banks unveiled a $66 billion all-stock merger Thursday that would create the sixth-biggest commercial bank in the United States, TheStreet’s Martin Baccardax reported.

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SunTrust said the deal would create a company with $442 billion in assets, as well as $324 billion in deposits with a customer base of around 10 million American household. The all-stock deal will see SunTrust investors receiving 1.295 shares of BB&T for each stock they own, as well as a 5% increase in their dividend, with BB&T owning 57% of the combined group’s $28.24 billion in equity to 43% for SunTrust.

“This is a true merger of equals, combining the best of both companies to create the premier financial institution of the future,” said BB&T CEO Kelly King. “It’s an extraordinarily attractive financial proposition that provides the scale needed to compete and win in the rapidly evolving world of financial services. Together with Bill’s leadership and our new SunTrust teammates, we’re going to bring the best of both companies forward to serve our clients and communities.”

So, what does this mean for the banking sector? Jim Cramer explains

Remember Nokia?
Cramer noted that he hasn’t been able to recommend Nokia shares since 1997, but now that the stock has an attractive valuation, and a stronger end-to-end portfolio of solutions, he thinks there’s upside potential if Europe follows the U.S. lead on shutting the door to Huawei and ZTE in 5G markets, Baccardax wrote.

“For years Nokia and Ericsson have been steamrolled by Huawei and ZTE,” Cramer told his Mad Money audience on CNBC last night. “That’s over. The U.S. government is doing everything it can to keep these companies out of 5G networks, not just here, but worldwide and that is a huge opportunity for Nokia and Ericsson.”

“I bet both stocks will get more attractive as our government keeps ratcheting up the pressure on allies to not use anything from these Chinese companies,” Cramer said.

Cramer further breaks down why investors should care about the company behind the indestructible flip phones.

Chipotle’s Comeback
Cramer wrote about Chipotle for his morning column over on Real Money.

“Chipotle’s back — and it is back right on time. That’s right, the company reported fantastic numbers Wednesday night, a colossal 6.1% comparable-sales number, coupled with healthy margins, including the persnickety labor costs that have bedeviled all fast food outlets these last few months,” he wrote.

Here’s Cramer’s explanation on Chipotle and what he’s watching in other food chains.

Twitter Slumps
Twitter posted stronger-than-expected fourth quarter earnings Thursday as the micro-blogging website held user growth but said expenses would rise notably this year as it moved to protect the integrity of its platform, reported Baccardax.

Looking into 2019, Twitter said it sees first quarter revenue in the region of $715 to $775 million, essentially in-line with the Refinitiv forecast of $765 million. Twitter also said GAAP and cash operating expenses would rise by 20% from last year, to a range of $550 million to $600 million, “as we support our existing priorities of health, conversation, revenue product and sales, and platform.”

Twitter said the average of daily active users that the company can monetize on its platform rose 9% to 126 million, helped by an 11% gain in international users to 99 million.

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