Barbell Portfolio: Cramer's 'Mad Money' Recap (Thursday  8/27/20)

Jim Cramer's sticking with his 'barbell portfolio' recommendation: COVID-19 winners and recovery stocks.
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This pandemic has collided with business in ways we could never imagine, Jim Cramer told his Mad Money viewers Thursday. Some of those collisions are good, while others aren't, Cramer said. That's why he continued to recommend a barbell portfolio that contains both COVID-19 winners and recovery stocks.

One of those unexpected collisions is happening in the enterprise space, where millions of workers have transitioned to working from home. That's why for his first Executive Decision segment, Cramer spoke with Enrique Lores, president and CEO of HP Inc.  (HPQ) - Get Report, the PC and printer maker that just posted a six-cents-a-share earnings beat.

Lores said PCs are essential tools for our new work-from-home economy, and HP is seeing a transition from one PC per home to one PC per person for many families. That's how HP was able to deliver 9% revenue growth during the quarter.

Lores added that today's HP laptops are not only lighter and have better performance,  they're made with more sustainable materials and packaged with the environment in mind.

HP remains committed to returning cash to their shareholders, Lores added, which is why the company increased their share buyback program during the quarter, taking advantage of their lower share price. They also remain committed to fostering diversity within HP. Lores said that diversity is something the entire company cares about and its results benefit from being one of the most diverse technologies companies.

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Executive Decision: Workday

For his second "Executive Decision" segment, Cramer also spoke with Aneel Bhusri, co-founder and once again co-CEO of Workday  (WDAY) - Get Report, the cloud software provider with shares up 11.1% since reporting strong quarterly results.

Bhusri said even during the pandemic, companies are finding that payroll, HR and planning software are mission critical applications. That's how Workday is still able to provide guidance about their business, while many others are seemingly in the dark.

Bhusri also commented on his new co-CEO role. He said after leading the company alone for the past 10 years, he's happy to once again have his partner and co-founder Chano Fernandez by his side. He said Fernandez lives the company's values and has stepped up to be a real wartime leader for the company during these challenging times.

When asked how Workday was able to win so much new business in the middle of a pandemic, Bhusri explained that Workday has many happy customers that provide strong references for new customers. He said the move to the cloud is ongoing and even challenged industries are seeing the benefits and cost savings of modern cloud applications.

Executive Decision: Splunk

For his final "Executive Decision" segment, Cramer checked in Doug Merritt, president and CEO of Splunk  (SPLK) - Get Report, the cloud analytics provider with shares up 130% from their March lows.

Merritt said these are turbulent times and change is not a natural behavior for most us. But with change comes opportunities to reimagine how business and education gets done. Remote work, distance learning and telemedicine aren't new concepts, he said, but they're being reinvented using new cloud technologies.

When asked about education, Merritt said its almost unimaginable how schools have been forced to transition millions of students to distance learning almost overnight. That's why Splunk is helping with new 360-degree views of online learning that benefits both students and teachers and helps both succeed.

One of Splunk's big wins recently has been Yale University. Merritt said Yale was initially interested in their remote working products, but once they became a customer, they quickly added cybersecurity services as well.

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Executive Decision: Williams-Sonoma

Moving onto his next interview, Cramer spoke with Laura Alber, president and CEO of Williams-Sonoma  (WSM) - Get Report, the home furnishings retailer that saw its shares decline 7.9% today after what Cramer called the best retail quarter he's seen.

Alber said that her team has shown incredible agility in the face of the pandemic. While they've always known that e-commerce was going to be their strength, they had no idea the transition would come so quickly. Online sales grew by 46% in the quarter and now account for 76% of total sales.

That's not to say that physical stores aren't important, however. Alber said their stores are experiential: They allow for omni-channel services and also act as mini distribution centers that support their digital-first priorities. Williams-Sonoma will ultimately have fewer, but better stores, Alber added, and they have a lot of leverage with their lease negotiations.

Finally, Alber noted that in addition to working from home, people are also studying at home. Williams-Sonoma will be increasing their assortment of items to help students make that transition even easier.

Advance in Testing

In his No-Huddle Offense segment, Cramer opined on today's news from Abbott Labs  (ABT) - Get Report that it has received FDA approval for its rapid COVID-19 test and the simultaneous announcement that our government is buying 150 million units.

Cramer said up until now, our country's only strategy to fight COVID was to wait for a vaccine. But now we may soon have Abbott's rapid test that can provide a result in just 15 minutes without the need to send a sample to a lab. Abbott's test even comes with its own companion app for your phone, called Navica, which allows you to share your results.

It will be awhile until these tests are readily available, but Cramer said when they are, they could give travel and leisure a much needed boost and give all of us some peace of mind.

Lightning Round

Here's what Jim Cramer had to say about some of the stocks that callers offered up during the Mad Money Lightning Round Thursday evening:

Generac Holdings  (GNRC) - Get Report: "The stock is up huge but it's still not too late. Our power grid is failing and Generac is the answer."

Energy Transfer  (ET) - Get Report: "No, no, that balance sheet is horrible. Let's skip that one."

Switch  (SWCH) - Get Report: "It's good. It's a good steady business. I like it."

Centene  (CNC) - Get Report: "This is a political year so this one cooled off. I don't want you to leave this one."

Cisco Systems  (CSCO) - Get Report: "This is not their moment but they've got a great yield so I think you're fine."

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