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Jim Cramer's 'Mad Money' Recap: Reflections on a Golden High

Looking at other metrics, Garner noted the slow stochastic momentum indicator showed the Nasdaq in an oversold condition, meaning a snap-back rally could be possible. But longer term, the MACD momentum metric signaled a bearish crossover.

The S&P didn't fare much better, with both the MACD and stochatics signaling there's not much upside left for the index, which has been trading in a channel for over a year. The upper limit of that channel would be 1,934.

Cramer said his take on Garner's analysis is that caution remains a prudent strategy. As he's not a fan of trading indices, he said there's no reason to dump the good stocks. Then again, no one ever got hurt taking a profit.

Amazon vs. Alibaba

It hasn't been a good year for (AMZN - Get Report) shareholders, with the stock down 25% so far in 2014, but Cramer said with the upcoming Alibaba initial public offering, things aren't likely to change any time soon.

Must Read: Jim Cramer's 'Mad Money' Recap: A Market Divided

Cramer said his logic is simple -- until now portfolio managers haven't had a choice. If they wanted to be in the e-commerce space, Amazon was the unparalleled leader in the space. But with Alibaba set to unleash $20 billion worth of its shares, money managers will now have a choice. Since they're not likely to own both companies, Amazon will lose out.

The growth metrics for Alibaba are simply better than Amazon, Cramer noted. The total addressable market in China is 540 million users and growing, over twice that of the U.S. Alibaba also has a superior business model, acting as a platform rather than a retailer, which means it holds no inventory. Revenue at Alibaba was up 62% last year, more than enough to keep money managers salivating, and mobile payments grew from 7% in 2012 to 20% in 2013.

While Amazon already gets over half of its sales from overseas, Alibaba is just starting its expansion. Given the company holds no inventory, Cramer said that expansion will come a lot quicker for Alibaba than it has for Amazon.

Add all that to the fact that Alibaba has 50% operating margins and it's safe to say Amazon will lose more than a few institutional investors when Alibaba hits the market later this year.

Executive Decision: Burton Goldfield

For his "Executive Decision" segment, Cramer sat down with Burton Goldfield, president and CEO of TriNet Group (TNET), a recent IPO that's been bucking the downward trend, trading at 22 times earnings with a 20% long-term growth rate.

Goldfield said TriNet has both growth and profits, something that's not common among many of today's newly public companies. He said small businesses need help navigating the new health care environment and TriNet provides it, plain and simple.

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AMZN $490.48 1.74%
CXO $85.97 0.46%
EXAM $24.89 0.44%
TNET $12.72 -0.70%
AAPL $94.27 -0.76%


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