Market pullbacks like we saw Monday tend to last for more than one day, Jim Cramer cautioned his Mad Money viewers. Cramer told viewers to be patient and be ready to pounce, however, as the markets won't stay this low forever.
Cramer said the speed and velocity of the day's decline were classic signs of a machine-driven selloff. And while no one knows what the machines are thinking at any given time, Cramer compiled a list of reasons why the rest of us might be thinking that today, or possibly tomorrow, would be a good time to sell.
First, Cramer said there are always investors who like to "sell the news," which made today's rumors of a possible trade deal with China the perfect time for those investors to sell. Longer term, a trade deal will be great for stocks, but in the short-term, Cramer said to expect some weakness.
Next, Cramer said there are the chartists among us, many of whom see bearish patterns that must be sold no matter what. This group is followed by the value investors, which are selling all of the biggest winners and swapping into the FAANG names, which have gotten incredibly cheap.
(FAANG is Cramer's acronym for Facebook (FB) - Get Meta Platforms Inc. Report , Amazon (AMZN) - Get Amazon.com Inc. Report , Apple (AAPL) - Get Apple Inc. Report , Netflix (NFLX) - Get Netflix Inc. Report and Alphabet (GOOGL) - Get Alphabet Inc. Report .)
Finally, Cramer said, there is still another contingent of investors who fear the market is overbought, and think now is the time to take profits.
Add these four groups together and it's easy to see why the market began to decline, and why the selling only accelerated once the machines added to the momentum.
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Executive Decision: Salesforce
For his "Executive Decision" segment, Cramer once again spoke with Marc Benioff, chairman and co-CEO of Salesforce.com (CRM) - Get Salesforce Inc. Report , the cloud computing giant which saw its shares fall 3.6% on what investors saw as a less-than-perfect quarter.
Benioff explained that despite Monday's share weakness, he's never felt better about the outlook for Salesforce. He said his company beat its revenue forecast for the quarter and Salesforce will be celebrating its 20th anniversary later this month.
When asked about what's driving their business, Benioff said that every company needs to connect directly with consumers, even if they sell to through middlemen. That's why every company, from high fashion brands to automakers, are turning to Salesforce to help manage their consumer facing operations.
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IPO Investments for the Long Term
When you're investing in red-hot IPOs, be prepared for many of your earning gains to be fleeting, Cramer told viewers. But over the long term, you may still have picked some winners, as he demonstrated with three recent recommendations.
Cramer said his November recommendation of Yeti Holdings (YETI) - Get YETI Holdings Inc. Report , makers of high-end camping gear, saw a classic IPO decline. After recommending it at $17, the stock fell to lows near $12 before steadily climbing to over $23 today. Cramer said the stock trades for 19 times earnings and is growing revenues at 19%.
Next was biotech Moderna (MRNA) - Get Moderna Inc. Report , a stock Cramer recommended on Dec. 10 at $18.80 a share. The stock saw lows near $13 before marching to over $21 today. Cramer warned this company may have 10 clinical trials, but it also has no earnings and little protection from wild market swings. Longer term, he still likes the company.
Finally, there was Tencent Music (TME) - Get Tencent Music Entertainment Group American Depositary Shares each representing two Class A 腾讯音乐娱乐集团 Report . This stock is up 34% from when Cramer recommended it in November. He said while he still likes the story, you can't blame anyone for taking some profits.
Executive Decision: Alteryx
In his second "Executive Decision" segment, Cramer sat down with Dean Stoecker, chairman and CEO of Alteryx (AYX) - Get Alteryx Inc. Class A Report , the data analytics company with 850 employees and 55% revenue growth.
There's an explosion in analytics, Stoecker explained, and now more than 30 million citizen data scientist are beginning to analyze their own data in nearly every vertical, every use case and in every country around the globe. It's not just companies and organizations, Stoecker added, even sports teams are beginning to unlock the value of the mountains of data that can be collected from players, fans, the stadium itself and more.
Stoecker continued by explaining that Alteryx is what's known as middleware. The company's software accepts data from any data source and it can output to any top-level consumption layer, whether for analytics, visualization or artificial intelligence. Best of all, much of the Altered platform doesn't require writing code to use it.
Alteryx sees big opportunities in healthcare, where the company has a dedicated team working on a multitude of use cases.
Looking Beyond Fashion in Retail
In his "No-Huddle Offense" segment, Cramer told viewers that retail isn't just about fashion anymore. Investors should no longer worry whether denim or sweaters will be the hot commodity this season, but rather which companies have the most influencers, who's the most sustainable and who is being left behind in the omni-channel revolution.
Cramer said company after company this quarter talked about the importance of these new millennial-driven trends. Capri Holdings (CPRI) - Get Capri Holdings Limited Report spoke of how social media influencers are driving their brands, while Gap Stores (GPS) - Get Gap Inc. (The) Report talked about their sustainability and VF Corp (VFC) - Get V.F. Corporation Report praised their direct-to-consumer channels.
It's no longer about just style, Cramer concluded, today's consumer is looking for a whole lot more.
In the Lightning Round, Cramer was bullish on Iron Mountain (IRM) - Get Iron Mountain Incorporated (Delaware)Common Stock REIT Report , NVIDIA (NVDA) - Get NVIDIA Corporation Report , Cypress Semiconductor (CY) - Get Cypress Semiconductor Corporation Report and AmeriGas Partners (APU) - Get AmeriGas Partners, L.P. Report .
Cramer was bearish on Huya (HUYA) - Get HUYA Inc. American depositary shares each representing one Class A Report and American Tower (AMT) - Get American Tower Corporation (REIT) Report .
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At the time of publication, Cramer's Action Alerts PLUS had a position in CRM,FB, AMZN, AAPL, GOOGL, AMGN.