"The market rewards improvement," Cramer told viewers, as he highlighted Newell Rubbermaid (NWL), a company that has been struggling for ages but now may be poised for a major turnaround. Last week, Rubbermaid reported terrific quarterly results, sending shares up 8%.
Cramer said that Rubbermaid has brands that we all know and love, brands like Rubbermaid, but also Calphalon in the kitchen and Sharpie at the office. This means that the company will benefit from the growing home improvement trend as consumers beef up spending on their homes.
But Rubbermaid is about more than just a rise in consumer spending, said Cramer, it's also about a major restructuring. The company has pared down its business divisions from 13 to just nine and has organized them into just two groups, consumer and professional. That means a drastic reduction in its bloated costs including redundant sales forces and overhead.Cramer said that Rubbermaid is now also a lot less hostage to rising resin and natural gas prices thanks to the continued diversification of its product lines. The company's CEO also has "street cred," said Cramer, after being a winner in consumer products for many years. After losing nearly 85% of its value from 2007 to 2009, shares of Rubbermaid currently sell for just 10.3 times earnings with the company's 9% growth rate. Cramer said the company derives only 10% of its sales from the ailing Europe and has the ability to boost its dividend after a 69% cut in 2009 and another 21% cut in 2010. Cramer said his bottom line is that sometimes the real winners aren't "A" students, they're "D" students that are turning themselves into "B" students.