The stock of Amazon (AMZN) - Get Report keeps getting hit and that could mean trouble for the broader market, Jim Cramer warned his Mad Money viewers Wednesday. Amazon's stock is already well off its highs and the company may not be an invulnerable as once thought.
Cramer said today's news that Walmart (WMT) - Get Report is teaming up with Alphabet's (GOOGL) - Get Report Google to take on Amazon's Alexa may give the company its first real rival in a long time. Add to that the time, effort and money Amazon will need to integrate Whole Foods Market (WFM) and now might be the perfect time to strike at the commerce giant.
Walmart is not alone, Cramer added. PVH (PVH) - Get Report is learning to survive in an Amazon world and Lowes (LOW) - Get Report announced that it will be recommitting itself to the web as well. TJX Companies (TJX) - Get Report also seems to have a winner strategy against Amazon in the off-price segment.
All of these factors are adding up to a bearish chart for Amazon's stock, Cramer concluded, at least in the short term. If the stock continues to trend lower, it will eventually spill over into the rest of the Nasdaq, he added.
On Real Money, Cramer says that for Amazon, the execution of its new, alien bricks-and-mortar concept takes center stage now. Get Cramer's insights with a free trial subscription to Real Money.
Executive Decision: PVH
In his "Executive Decision" segment, Cramer again sat down with Manny Chirico, chairman and CEO of apparel maker PVH, which just posted a five-cents-a-share earnings beat with rising revenues and gross margins. The company also raised its full-year revenue and earnings guidance. Shares responded by rising 3.4%.
Chirico said that international sales continue to drive the growth of PVH, with comparable store sales in Europe up mid-to-high single digits, and the order books for Tommy Hilfiger up 10% and Calvin Klein up 25%. Ecommerce also continues to be strong, both at the company's own website and also at its online partners.
That's not to say that sales are not strong in North America, however. Chirico said that 58% of PVH sales still originate domestically and the back-to-school season is off to a strong start. PVH continues to meet customers wherever they are.
Finally, when asked what's next for the company, Chico said that PVH is always looking to buy back the parts of Calvin Klein that it doesn't control and is seeking opportunities to add other brands to its portfolio.
Cramer and the AAP team do some charting analysis for their investment club members on General Electric (GE) - Get Report . Get in on the conversation with a free trial subscription to Action Alerts PLUS.
When Bad News Is Good News
Shares of Align are up 50% since Cramer last recommended the company back in March. He said the company is a play on the need to look your selfie best, and that includes having a great-looking smile.
The possibility of increased competition from rival ClearConnect is to blame for Align's recent weakness, but Cramer said he's not worried. All of Align's current technology is still protected under the company's patents, which it has been vigorously, and successfully, defending. There are 10 million people a year who need braces, half of whom could benefit from Invisalign. Yet the company still has only 10% market share, leaving plenty of room to grow.
In the end, Cramer said he doesn't see ClearConnect as much of a threat, as they have been around for years without doing much damage. More worrisome to Cramer was the stock's multiple of 40 times earnings, which is why he only recommended buying it on weakness.
Executive Decision: Pioneer Natural Resources
In his second "Executive Decision" segment, Cramer sat down with Tim Dove, president and CEO of Pioneer Natural Resources (PXD) - Get Report , the oil producer whose shares plunged 13% after the company cut its production targets earlier this month. Shares of Pioneer are down 27% so far this year.
Dove said that Pioneer continues to be a leader in oil exports, averaging one million barrels a quarter, a number which he said will grow considerably larger. Much of Pioneer's oil is high quality and low sulphur, making it ideal for many refiners.
Dove added that Pioneer's 10-year plan is based on $55 a barrel oil and they're 90% hedged this year against anything below $50 a barrel.
When asked about the U.S. oil industry being its own worst enemy, Dove said that U.S. production of 9.5 million barrels a day will likely increase to 10.7 million by the end of 2018, meaning the U.S. will be able to fill any gaps in demand, but in the end they "drill wells to make money," so the industry won't let prices fall too far.
Finally, Dove said he'd love to take back his mention of "train wreck" oil wells on his company's conference call. He said the term is an internal one that references wells that are more than 10% outside of their estimates. The term does not mean that Pioneer is losing money on those wells.
And For When You Win the Lottery...
In his "No-Huddle Offense" segment, Cramer offered up some advice to anyone who wins the $700 million Powerball lottery.
First, Cramer said, take the money all at once, followed by paying your taxes all at once. Next, he said to remember that you only need to get rich once, so don't invest in risky stocks or get swindled by those with "sure-thing" investment opportunities.
Finally, Cramer suggested donating perhaps 10% of the winnings to local charities that you can keep an eye on, while the remaining 90% should be well diversified with gold, real estate, art, bonds, index funds and yes, a small portion in a Mad Money portfolio to keep things interesting. But, he added, no more than 5% of your wealth in any individual stock, ever.
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At the time of publication, Cramer's Action Alerts PLUS had a position in GE, GOOGL, TJX.