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Put simply, retail is a zero-sum game. If Amazon is growing by double digits, then those sales have to be coming from others. The synergies of the mall are fleeting in the age of cell phones and binge watching on Netflix (NFLX - Get Report) , Cramer said. Even low gasoline prices don't seem to be getting shoppers out of their living rooms.
But that doesn't mean that all retailers are struggling. Cramer said Costco (COST - Get Report) , a stock he owns for his charitable trust, Action Alerts PLUS, can do well because once people pay for a membership they often feel obligated to go. He is also a fan of Ulta Salon (ULTA - Get Report) because, try as it may, Amazon hasn't yet cracked the beauty business.
Cramer is also bullish on TJX Stores (TJX - Get Report) , which buys excess inventory from department stores and sells it at great prices, and Home Depot (HD) , which continues to see customers investing in their homes.
A Tale of Two Jewelers
What's going on in the jewelry business? Back in October Cramer recommended Signet Jewelers (SIG) but last week the stock sank 4% on a surprisingly weak quarter while rival Tiffany (TIF) saw its shares rise 4% despite missing its forecasts, again.
Cramer said he was wrong in recommending Signet at $147 a share. The company had been a stellar performer, but its acquisition of Jared hit some stumbling blocks that derailed the quarter.
However, with shares now trading at $131, down near 19 times earnings, Cramer said Signet is an even better story than it was in October, especially with the integration issues behind it, he hopes.
As for Tiffany, Cramer said this company has become terrible at being able to forecast its business. The company promised, and failed, to deliver last holiday season and is once again predicting good things this season. But with shares trading at 20 times earnings, Cramer said Signet still represents the better buy.