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Cramer's Mad Money Recap: Walmart, Costco

Jim Cramer talks about this big rotational pattern, and which retailers are poised to gain.
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Not all stocks can go up at the same time, Jim Cramer told his Mad Money viewers Monday. There simply isn't enough money to push everything higher at once, he said, and that's how rotations are born.

For decades, investors have been told that stock picking is too hard and they'd be better off with an index fund. And while Cramer said he agrees that index funds are great for retirement accounts or those with little time or inclination to pick their own stocks, for those that do, stock picking is the place to be.

That's because all it takes to be a great stock picker is to use your powers of observation. We all know consumers are spending again, and that's great news for retailers like Walmart  (WMT) - Get Walmart Inc. Report and Costco  (COST) - Get Costco Wholesale Corporation Report.

People are still spending on their homes, which makes Lowe's  (LOW) - Get Lowe's Companies Inc. Report a great buy, along with everything that goes into Lowe's, like Whirlpool  (WHR) - Get Whirlpool Corporation Report appliances and Stanley Black & Decker  (SWK) - Get Stanley Black & Decker Inc. Report tools. RH  (RH) - Get RH Report continues to be a favorite.

Apparel is another hot group, and Cramer suggested names like PVH  (PVH) - Get PVH Corp. Report, Ralph Lauren  (RL) - Get Ralph Lauren Corporation Report and VF Corp.  (VFC) - Get V.F. Corporation Report.

Then there are the lagging retailers like L Brands  (LB) - Get L Brands, Inc. Report, American Eagle Outfitters  (AEO) - Get American Eagle Outfitters Inc. Report and Gap Stores  (GPS) - Get Gap Inc. (The) Report, all of which Cramer recommended.

Cramer said all of these stocks are obvious winners, all you have to do is visit their stores.

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Executive Decision: XPO Logistics

In his first "Executive Decision" segment, Cramer spoke with Malcolm Wilson, the current CEO of XPO Logistics  (XPO) - Get XPO Logistics Inc. Report Europe and the incoming CEO for GXO Logistics, which will soon spin off from XPO.

Wilson explained the current XPO Logistics consists of both transportation and logistics. The transportation components will remain with XPO, while the warehousing and logistics businesses will become the new GXO Logistics, which he will head.

The new GXO will serve 30% of the Fortune 100, Wilson noted, and is driven by three emerging trends. First, is the continued popularity of outsourcing. Second, is e-commerce, which accounts for 40% of GXO's business. Lastly is the trend toward industrial automation and robotics, an area where GXO was a first mover.

When asked how Europe is recovering from the pandemic, Wilson said that in some countries, like the U.K., vaccine progress is similar to that of the U.S., but the majority of Europe should be back to normal in a few months.

Get Some Fresh Air

With the great reopening trade upon us, Cramer highlighted another red-hot but forgotten theme, the great outdoors.

When Cramer spoke to Brunswick Corp.  (BC) - Get Brunswick Corporation Report last week, the boat maker indicated that it may be one to two years before they can fully meet demand and return inventories to normal levels. With shares trading for less than 13 times earnings, Cramer said he's a buyer.

But Brunswick is not alone in the great outdoors. LCI Industries  (LCII) - Get LCI Industries Report trades at less than 15 times earnings with a 2% yield. RV maker Thor Industries  (THO) - Get Thor Industries Inc. Report trades for 14 times earnings and rival Winnebago  (WGO) - Get Winnebago Industries Inc. Report trades for just 11 times earnings.

Cramer was also bullish on Camping World  (CWH) - Get Camping World Holdings Inc. Class A Commom Stock Report, a regional-to-national growth story, with shares that trade for just nine times earnings, and Airbnb  (ABNB) - Get Airbnb Inc. Report, which is off 11% from its highs.

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Demand for the great outdoors has never been higher, Cramer said, and these stocks are poised to capitalize on it.

Executive Decision: Lydall

For his second "Executive Decision" segment, Cramer also spoke with Sara Greenstein, president and CEO of Lydall  (LDL) - Get Lydall, Inc. Report, the filtration materials maker with shares up 25% since Cramer last checked in back in December.

Greenstein said that while most of the world first learned of Lydall last year during the pandemic, her company is about a lot more than just N95 masks. She was proud to report that Lydall's filtration media is onboard the Moxie module of NASA's Perseverance rover currently on Mars. Lydall's filters are removing fine Martian dust from the planet's carbon dioxide-rich atmosphere and allowing the Moxie module to make oxygen that could someday be used by astronauts.

Closer to home, Lydall continues to make filter media for N95 masks, which Greenstein noted will be in high demand for years to come. Lydall is also making critical components for electric vehicles, including materials to shield from interference, dampen sound and keep air fresh.

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.

A New Way of Investing?

In his "No Huddle Offense" segment, Cramer sounded off on investing legends Warren Buffett and Charlie Munger, both of whom have been critical of the Robinhood traders.

Cramer said he thinks it's great that Robinhood has attracted millions of new investors to the market. The platform certainly has its flaws, he added, but Robinhood isn't attracting a bunch of mindless sheep, it's attracting those who want a different way of investing.

While both Buffett and Munger have impressive long-term track records, they too have made many mistakes and missed many of the trades the Robinhood crowd has become adept at spotting and exploiting.

It's elitist to say that there's only one way to make money, Cramer concluded. That's a lesson younger investors teach us every day.

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" Monday evening:

Penn National Gaming  (PENN) - Get Penn National Gaming Inc. Report: "I like Penn National very much. I love the tie-up with Barstool Sports."

Alcoa  (AA) - Get Alcoa Corporation Report: "That was a brilliant quarter. I'm a buyer."

Social Capital Hedosophia  (IPOB) - Get Social Capital Hedosophia Holdings Corp. II Class A Report: "Wait until the acquisition is complete and this one becomes Sofi."

Hydrofarm HYFM: "I like GrowGeneration  (GRWG) - Get GrowGeneration Corp. Report in this space."

Aemetis  (AMTX) - Get Aemetis Inc Report: "These stocks all work. This is in a sweet spot right now."

Palantir Technologies  (PLTR) - Get Palantir Technologies Inc. Class A Report: "I want more transparency. This company is too opaque."

Sherwin-Williams  (SHW) - Get Sherwin-Williams Company (The) Report: "This was a great quarter for them. "

Novocure  (NVCR) - Get NovoCure Limited Report: "This has still not been largely recognized by the medical community. When it is, it's going higher."

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At the time of publication, Cramer's Action Alerts PLUS had a position in WMT, COST.