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When the market does something stupid, take the opportunity to do something smart, Jim Cramer urged his Crazy money viewers Tuesday. Too often, the market makes movements seemingly without any news, says Cramer, and it's usually the right time to invest in weakness.
Example: Apple (AAPL – Get Report), which climbed 4.9% today on solid profits, including a good performance in China and in all services. Cramer said that the lifetime value of an iPhone user was only increasing, which makes Apple sellers rather confusing.
Then there is Alphabet (GOOGL – Get Report), which has continued to decline, Google losing market share to the benefit of Amazon (AMZN – Get Report) and Facebook (FB – Get Report). So why were Amazon and Facebook down today? Cramer said investors should turn this stupidity into opportunity.
Most stocks of packaged consumer goods have reacted strongly to fears of recession, Cramer said. But if the economy goes into recession, why are stocks of FedEx (FDX – Get Report) and UPS (UPS – Get Report) also growing? These stocks fall when the economy weakens.
Finally, Cramer said that Occidental Petroleum (OXY – Get Report) had also made a stupid decision today, when the company took $ 10 billion from Warren Buffett to finance the acquisition of Anadarko Petroleum (APC – Get Report) at 8%. The company could easily have financed the operation at a rate of interest of only 5%, said Cramer. Occidental did not need Buffett for this agreement to be concluded. He advised selling both names, even though Anadarko is an Action Alerts PLUS holding company.
Cramer and the AAP team say the Anadarko Petroleum saga (APC – Get Report) is coming to an end. Find out what they say to their investment club members and join the conversation with a free trial subscription at Action Alerts Plus.
Executive decision: Shopify
For its "Executive Decision" segment, Cramer has been talking to Harley Finkelstein, Shopify's COO (SHOP – Get Report), the online store provider whose shares have grown 7.8% today. after the company released strong earnings. Shopify shares have increased by 39% since Cramer's last visit to Finkelstein in February.
Finkelstein called Shopify an "entrepreneurial company" because it allows small businesses around the world to sell their products with the same economies of scale as larger retailers. The Shopify platform has more than 820,000 merchants, he said. Together they would be the third largest online retailer.
Finkelstein added that Shopify equals the small business playground by providing them with the best tools and the best rates to compete with others. It is a retail operating system that combines online and in-store sales, all in a centralized back office with world-class technology. In fact, even major brands are turning to Shopify to build their direct sales systems to the consumer.
Whether you're selling shoes, socks or cosmetics, Shopify has the tools to make your small business a resounding success.
In real money, Cramer refers to the companies and CEOs that he knows best. Get more of his ideas with a free trial subscription to real money.
The hard truth about Google
There's no easy way to say it, Google is being kicked by its competitors, Cramer told viewers. This is what he learned from Alphabet's $ 1 billion shortfall this quarter and the subsequent conference call, in which the company refused to admit its mistakes.
Cramer said it was clear that Google was losing its share of the advertising market to the benefit of Amazon and Facebook, but that the company was also losing the confidence of analysts in refusing to admit its problems and in offering no plan to solve them. It is therefore not surprising that shares have fallen 7.5% today, in addition to previous losses.
While it is good that Alphabet plans to strengthen its cloud services to better compete with Amazon and Microsoft (MSFT – Get Report), Cramer asked why the company had left Amazon and Microsoft such a huge advance?
Cramer said he had little confidence in management who would not tolerate their mistakes, so for now, Alphabet is no longer a buy.
Executive decision: Zebra Technologies
In its second "Executive Decision" segment, Cramer met with Anders Gustafsson, CEO of Zebra Technologies (ZBRA – Get Report), the logistics software provider that saw its shares plunge 6.9% to closing after posting strong earnings, but with lukewarm forecasts.
Gustafsson explained that while Zebra is still confident in its business, its growth rate is slowing slightly, which has reduced its expectations to remain conservative. He added that Zebra continued to turn to more consulting and data services because no one knew the workflow of its customers better.
Zebra is celebrating its 50th anniversary this month. Gustafsson said his evolution has evolved a lot, from mechanical systems 50 years ago to bar coding services in the 1980s, to becoming today a business services company more than ever before.
Zebra helps companies replace outdated Microsoft Windows devices with the latest devices running Android, increasing speed and efficiency and providing a host of new services that were simply not available on the market. existing products.
Executive decision: TRI Pointe Group
In his third Executive Decision segment, Cramer also met Doug Bauer, CEO of TRI Pointe Group (TPH – Get Report), the homebuilder whose shares plunged 7.6% last week after a recovery in profits .
Mr. Bauer said the trend was down from the declines seen at the end of 2018. He added that the consumer had become more engaged now that interest rates were going down. But more importantly, he added, are the demographic trends generated by the demand for unmet housing.
Bauer added that although low interest rates were helpful, growth in employment and wages was the real driver of the housing market.
Asked about California's lucrative market, Bauer said TRI Pointe had 11,000 lots in California, but there was still much work to be done, particularly in Silicon Valley, to lower prices. He added that a more lax regulatory environment would help boost supply to ease this pressure.
Lightning Tower
In the Lightning Round, Cramer was optimistic about Norwegian Cruise Line (NCLH – Get the Report), Macy's (M – Get the Report), Ecolab (ECL – Get the Report), Pioneer Natural Resources (PXD – Get the report), EOG (EOG – Get A Report) and Cisco Systems (CSCO – Get a Report) Resources.
Cramer was bearish on ProLogis (PLD – Get Report), Walgreens Boots Alliance (WBA – Get Report), Carnival (CCL – Get Report), Vodafone Group (VOD and Apache (APA – Get Report).
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