Thursday was a great lesson in diversification, Jim Cramer told his Mad Money viewers. We saw investors rotating out of anything that requires microchips, which are in short supply, and into snack chips, where companies like PepsiCo (PEP) - Get PepsiCo Inc. Report continue to see strong demand. This was a classic rotation from tech into the safety of food stocks, Cramer said, and it won't be the last.
The shortage of microchips continues to clobber company after company, with everyone from Ford Motor (F) - Get Ford Motor Company Report to Apple (AAPL) - Get Apple Inc. Report feeling the pinch. It was caused by the one-two punch of just-in-time inventories meeting head on with the Chinese placing double orders to bolster their own stockpiles. But while some tech stocks, like Apple, have been affected by the shortage, others like Facebook (FB) - Get Meta Platforms Inc. Report, Alphabet (GOOGL) - Get Alphabet Inc. Report and Amazon (AMZN) - Get Amazon.com Inc. Report have advertising and other revenue streams to offset the slowdown.
Meanwhile, the food stocks have something the tech stocks don't -- dividends. This is especially important in a world where capital gains taxes might be going up. If they do, that means dividends only get more attractive.
That's why you need a diversified portfolio, Cramer concluded. If you invest in both microchips and snack chips, you're sure to come out ahead no matter which way the winds on Wall Street are blowing.
Cramer and the AAP team are looking at everything from earnings and politics to the Federal Reserve. Find out what they're telling their investment club members and get in on the conversation with a free trial subscription to Action Alerts Plus.
Executive Decision: Caterpillar
In his first "Executive Decision" segment, Cramer spoke with Jim Umpleby, chairman and CEO of Caterpillar (CAT) - Get Caterpillar Inc. Report, the machinery maker whose shares spiked 3% in early trade when the company reported strong earnings, only to fall 2% by the close.
Umpleby said Caterpillar is seeing growth and margin expansion in all three of its divisions as demand picks up around the globe. Many of the commodities they serve, including oil and gas, copper, iron ore and gold, are all on the rise as demand improves.
Umpleby added that any infrastructure plan passed in the U.S. would certainly be a net-positive for the company. He said it seems like there is bipartisan support to get it done.
When asked about the semiconductor shortage, Umpleby said Caterpillar made a decision to carry more component inventory at the onset of the pandemic, a move that has largely shielded them from disruptions so far. They are still able to meet rising demand across the globe.
Umpleby also commented on Caterpillar's first-ever diversity and inclusion report. He said publishing this report was an important first step for the company, although he admitted there is "a ways to go" to get to their goals.
Executive Decision: Domino's
For his second "Executive Decision" segment, Cramer spoke with Rich Allison, CEO of Domino's Pizza (DPZ) - Get Domino's Pizza Inc Report, the pizza delivery giant that just delivered earnings that included a 13% increase in same-store sales.
Allison said he's excited not only for the increase in same-store sales, but also for the rebound in store reopening after so many Domino's locations were closed due to the pandemic. Momentum is building around the globe, with international sales up 11.8%.
Allison added that when it comes to growth, Domino's still sees the possibility for 5,000 additional locations in just their top 15 markets.
Domino's has always been a technology company, and Allison said that the company invested heavily into technology before the pandemic and those investments have paid off. Some 70% of all orders were digital before the pandemic began and 75% of all orders are digital now.
Allison was also excited for their autonomous delivery trials with partner Nuro in Houston. He said they give customers the option of whether to try out the new technology and they're learning a lot about how customers and restaurants alike interface with fully-autonomous vehicles.
Executive Decision: Align Technologies
For his final "Executive Decision" segment, Cramer checked in Joe Hogan, president and CEO of Align Technology (ALGN) - Get Align Technology Inc. Report, the orthodontics supplier that just posted 62% revenue growth with better-than-expected earnings. Shares responded by falling 1.4%, a move Cramer called a mistake.
Hogan said digital orthodontics have been a game changer for the industry and the transformation is just beginning. What started with teens and younger patients has now expanded to patients of all ages during the pandemic. He said nearly 75% of all adults have an alignment issue that could be rectified by Align.
Align has been a life-saver for many dental offices, Hogan noted. As patients dwindled during the pandemic, Align's products were able to augment declining revenues. Now that sales are returning, patients are requesting Align more.
Align is investing heavily into research and development, Hogan said. The company uses artificial intelligence algorithms to help determine the best way to move teeth to where they need to go and the company is also offering remote monitoring services to help patients avoid some trips to the dentist's office.
On Real Money, Cramer keys in on the companies and CEOs he knows best. Get more of his insights with a free trial subscription to Real Money.
Draft Day: Ford's a Winner
In his "No Huddle Offense" segment, Cramer celebrated NFL draft day by picking his favorite down-and-out stock, Ford, as the best stock to own between now and the end of January.
Cramer interviewed Ford CEO Jim Farley on Wednesday's show and said shares have finally fallen to a point where the expectations are so low that Ford simply can't miss.
Ford has some exciting new products on tap that are sure to impress and, according to Farley, the worst of the chip shortage for Ford will be this quarter. That means the time to invest in Ford is now, ahead of the great revival of this great American automaker, Cramer said.
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:
Search Jim Cramer's "Mad Money" trading recommendations using our exclusive "Mad Money" Stock Screener.
To watch replays of Cramer's video segments, visit the Mad Money page on CNBC.
To sign up for Jim Cramer's free Booyah! newsletter with all of his latest articles and videos please click here.
At the time of publication, Cramer's Action Alerts PLUS had a position in F, AAPL, FB, GOOGL, AMZN.