The stock market isn’t a referendum on the state of our nation, Jim Cramer reminded his Mad Money viewers Thursday. Thursday’s market rally had nothing to do with Wednesday’s insurrection in Washington, he said. Instead, it had everything to do with there simply being more buyers than sellers.
Cramer identified 10 reasons why the buyers were able to overwhelm the sellers Thursday, taking the averages higher. First, he said stocks are still the only game in town. Bonds simply cannot compete with stocks. Second, machine trading runs on autopilot and when they see opportunities, they buy, regardless of the state of the world. Along those lines, Cramer added that many companies in the S&P 500 have big buyback programs, which are buying back shares every day no matter what.
Next, Cramer said the Tesla (TSLA) – Get Report effect is still taking the S&P higher, as index funds continue to accumulate shares. He also added that stimulus checks are coming and during the last round, many individuals bought stocks.
For many on Wall Street, yesterday’s carnage marks the low point of this administration and many are looking forward to better times ahead. They are bullish on the prospects of infrastructure spending and alternative fuel subsidies.
Finally, Cramer noted that many company managements are prepared for chaos like this, which is why he said the long-term themes he laid out last week are still the best way to play the markets in times of uncertainty.
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Table of Contents
Executive Decision: Plug Power
In his first “Executive Decision” segment, Cramer spoke with Andy Marsh, president and CEO of Plug Power (PLUG) – Get Report, the hydrogen forklift maker that’s on the cusp of the alternative fuel revolution. Plug Power today announced a partnership with the Korean-based SK Group.
Marsh said Plug Power’s mission continues to be expanding the green hydrogen economy and their partnership with SK in Korea is another step forward in that mission. He said the conglomerate chose to work with Plug Power because they could “do it all,” from building hydrogen fuel stations, to generating green hydrogen and even backup power facilities.
Green hydrogen is estimated to be a $40 billion opportunity by 2040, Marsh said, and Korea is planning on using 150 times as much hydrogen as the U.S. does today. He told viewers to expect more news from Plug Power in Asia and Europe coming soon.
Here in the U.S., Marsh said the companies like Amazon (AMZN) – Get Report and Walmart (WMT) – Get Report are also looking to expand more with hydrogen, fueled by falling wind and solar prices. At four cents per kilowatt hour, Marsh said generating hydrogen becomes competitive with natural gas, which makes it appealing for many industries.
Executive Decision: Bed Bath & Beyond
For his second “Executive Decision” segment, Cramer also spoke with Mark Tritton, president and CEO of Bed Bath & Beyond (BBBY) – Get Report, the home goods retailer that saw its shares plunge 10.9% Thursday after the company reported a revenue and earnings miss that included just 2% growth in same store sales.
Tritton said that Bed Bath & Beyond has laid out a three-year growth plan and remains on track with those plans. He said the company sees sustainable growth ahead and many of the investments it has already made are beginning to bear fruit.
When asked about the company’s slumping same-store sales, Tritton noted that Bed Bath & Beyond saw a 77% increase in digital sales, many of which were picked up at local stores. He said the pivot towards an omni-channel experience has been a significant one, which is why they’re focused on total growth comparisons instead of just same-store comparisons.
Turning to their long-term plans, Tritton said that Bed Bath & Beyond has a solid balance sheet, is reducing debt and investing for their future growth, all of which puts it on a solid foundation.
Executive Decision: Constellation Brands
For his final “Executive Decision” segment, Cramer checked in Bill Newlands, president and CEO of Constellation Brands (STZ) – Get Report, the wine and spirits maker that just posted a monster 67-cents-a-share earnings beat on a 9% rise in revenues.
Newlands attributed the strong quarter to the strength of their brands. He said that in times of uncertainty, consumers turn to brands they trust, and names like Pacifico, Modelo and Corona are among those brands.
Newlands added that Constellation has doubled-down on the health and safety of their employees, allowing them to operate at high levels throughout the pandemic.
When asked about the growing popularity of hard seltzer, Newlands noted that Constellation had just one type of hard seltzer last year, but managed to sell 10 million cases of it. He said they will be offering other flavors in the near future as they ramp up to meet growing demand. Newlands was also optimistic about the company’s investment in Canopy Growth (CGC) – Get Report, saying that the company is positioned to win as cannabis gains additional legalization.
Finally, Newlands said Constellation remains committed to supporting the communities they serve, from wildfire relief in California to COVID-19 support to investments in minority-owned businesses through their venture arm.
In his No-Huddle Offense segment, Cramer pondered whether big oil, electric vehicles and hydrogen stocks can all coexist at the same time. In the short term, you bet.
Investors looking to invest in oil can still choose Chevron (CVX) – Get Report, Pioneer Natural Resources (PXD) – Get Report or pipeline Kinder Morgan (KMI) – Get Report, Cramer said. Now that the Democrats are in charge, less drilling will only help oil prices in the short term.
As for electric vehicles, Cramer said Tesla is now worth more than all other automakers combined.
There is room for alternative energy as well, Cramer said. Plug Power continues to grow and stocks like QuantumScape (QS) – Get Report will also continue to rally in the short term.
Here’s what Cramer had to say about some of the stocks that callers offered up during the Mad Money Lightning Round Thursday evening:
Autodesk (ADSK) – Get Report: “This is great software. It’s a buy.”
Inseego (INSG) – Get Report: “I like this one a lot.”
BigCommerce (BIGC) – Get Report: “Just buy Adobe Systems (ADBE) – Get Report. They’re doing great and no one is talking about them.”
Crown Castle (CCI) – Get Report: “This is a REIT so when interest rates go up, this stock goes down. You’re gonna make a lot of money with this one.”
Biohaven Pharmaceuticals (BHVN) – Get Report: “I’m a believer in migraine treatments. This is the best in show.”
Golden Nugget Online Gaming GNOGW: “I like DraftKings (DKNG) – Get Report. I’d go with them.”
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At the time of publication, Cramer’s Action Alerts PLUS had no position in the stocks mentioned.