It didn't matter whether you believe in a recession or a recovery, Jim Cramer told his Mad Money viewers Monday. On this day, both views of our economy were on the rise, in a wild day of trading that included a sharply lower open followed by a huge reversal by the market close.
In the "America Awakens" camp, investors who believe COVID-19 is already in the rear-view mirror were bidding up stocks like Nike (NKE) - Get Report, Home Depot (HD) - Get Report, Walt Disney Co. (DIS) - Get Report and even FreeportMcMoran (FCX) - Get Report. Cramer said this group believes a vaccine is right around the corner and our economy is already on the mend. You would never buy a copper stock like Freeport unless you believe a recession is around the corner, Cramer said.
Meanwhile, those investors who focus on surging COVID-19 cases, sky-high unemployment and government benefits that will soon run out were buying the recession stocks. Names like Campbell Soup (CPB) - Get Report, Clorox (CLX) - Get Report, Shopify (SHOP) - Get Report and Zoom Video (ZM) - Get Report were just a few of the names that ended the day sharply higher.
Cramer said that, someday, the "America Awakens" group will be right, but right now it's still too soon to sound the all-clear. That's why he continues to recommend a barbell portfolio with the best of the recovery stocks, like Disney, but also a whole lot of Zoom Video.
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Executive Decision: Penn National Gaming
In his first "Executive Decision" segment, Cramer spoke with Jay Snowden, president and CEO of Penn National Gaming (PENN) - Get Report, the casino operator with shares that plunged 90% in mid-March as the pandemic shut down the economy. Since then, Penn has raised $700 million in additional capital and its shares have recovered to new highs.
Also on the call were Dave Portnoy and Erika Nardini, the founder and CEO of Barstool Sports, which has partnered with Penn for sports betting and sports-related content.
Snowden said their reopening is off to a good start, with 70% of their properties operating at 50% capacity. Everyone is anxious to get out of their homes, he said, and Penn was able to reactivate 11,000 team members so far.
Portnoy added that he's anxious for the return of sports, although Barstool has been able to keep their audience engaged with other content, like video games and the stock market, in the meantime. He said there's no doubt that when sports returns, Barstool will be the dominant player in their space.
Nardini said there is no audience like Barstool's and they have the fastest growing audience on every social network. There is incredible growth ahead for Barstool, she said, and if the analysts don't see it, they're looking in the wrong direction.
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Spotify's Back in Tune
What should investors do with Spotify (SPOT) - Get Report, the music streaming service that was a red-hot IPO in 2018 but had seemingly lost its mojo until recently? Cramer said Spotify is back and it's time for investors to step up and take notice. After falling from $150 a share in February to lows near $110 in March, Spotify has gotten its groove back and is ready to roar higher.
Cramer explained that about a year ago, Spotify announced its plans to diversify away from just music streaming and to dominate podcasting as well. The move confused shareholders, many of whom bought into the music streaming business but were not prepared to see the company make huge investments into an entirely new category.
But Spotify has since proven the naysayers wrong. Not only has the company thrived during the pandemic, growing its free user base 31% over the past year and premium users by 29%, it's also beginning to see the fruits of its many podcast acquisitions. The company now has a vertically integrated podcast offering with many new shows on the way. Most importantly, Spotify now has shareholders who understand what it is trying to do. After announcing the addition of Joe Rogan's podcast to its growing network in May, shares of Spotify have been rallying hard.
Cramer said Spotify's podcast strategy reminds him of when Netflix (NFLX) - Get Report first started producing its own original content. Netflix also spent heavily, upsetting shareholders, but has since been heavily rewarded.
Executive Decision: Check Point Software
For his second "Executive Decision" segment, Cramer also spoke with Gil Shwed, founder and CEO of Check Point Software (CHKP) - Get Report, the cybersecurity company with shares that trade for just 16 times earnings.
Shwed said the work-from-home trend opens up all new attack vectors for hackers and Check Point is working with companies all around the globe to help get them ready for the attacks that will be coming. He said there are already bad actors taking advantage of people's desires for information on COVID-19 to install malware and ransomware on their computers and infect their company's networks.
Check Point recently raised capital to help them weather the COVID-19 storm and Shwed said the company has $400 million on their balance sheet and that's a great thing that gives them both flexibility and the ability to keep making smaller acquisitions as they become available.
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Winners for our Time
In his No-Huddle Offense segment, Cramer said sometimes picking winners is as easy as looking at the new all-time high list. There were 134 new highs on Friday alone.
Looking at the top 20 new highs in the S&P 500 reveals a number of hot trends, including Regeneron (REGN) - Get Report, which continues work on a vaccine and treatment for COVID-19. There are entertainment plays like Activision Blizzard (ATVI) - Get Report. There are numerous cloud computing stories like Adobe Systems (ADBE) - Get Report and ServiceNow (NOW) - Get Report. And, of course, there's Clorox.
Sometimes, you don't need to overthink it, Cramer concluded. Sometimes, you can just stick with what's working.
Here's what Jim Cramer had to say about some of the stocks that callers offered up during the Mad Money Lightning Round Monday evening:
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At the time of publication, Cramer's Action Alerts PLUS had a position in CLX, DIS.