When our booming economy begins to cool, the tech stocks will come roaring back, Jim Cramer told his Mad Money viewers Wednesday. That's why it's always prudent to keep a diversified portfolio and never give up on FAANG.
Yes, it's true, things aren't looking good for the FAANG stocks so far this year. Shares of Amazon are up just 1%, while Apple remains down 3% for the year. Those results can't hold a candle to the industrials like Cleveland-Cliffs (CLF) - Get Report, up 39%, or steelmaker Nucor (NUE) - Get Report, up 75%.
But Cramer said he's not giving up on FAANG and offered up five reasons why it would be a mistake to sell.
First, there is no real FAANG, these are just five separate entities, all with winning pedigrees. Second, while FAANG may be lower in 2021, over the long term, it's no contest. Over the past 10 years, Apple has delivered 934% gains and Amazon is up 1,559%.
Third, boom times like now are great, but they never last. The economy will eventually cool and the industrials will fall. Meanwhile, FAANG is built to last. All of these companies have the scale and resources to reinvent themselves time and again.
In fact, Cramer's final reason to own FAANG was because they consistently reinvent themselves. Apple did it with the Mac, iPod, iPhone and now services. Netflix has done it from mail-in DVDs to streaming and original content. Amazon sold books, then everything else, and now web services and advertising. The industrials, on the other hand, well, they still mine metals and make steel.
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Executive Decision: Trane Technologies
In his first "Executive Decision" segment, Cramer spoke with Mike Lamach, chairman and CEO of Trane Technologies TT, the climate controls company with shares up 118% over the past year.
Lamach said that after spinning out from Ingersoll Rand (IR) - Get Report, they looked at their company as a startup, organizing and investing for innovation and profits. As we've seen over the past year, indoor air quality has never been more important. So, too, has refrigeration for things like vaccines. Trane has been at the forefront of innovation, creating all-new freezer technologies to keep vaccines from Pfizer (PFE) - Get Report and Moderna (MRNA) - Get Report at subzero temperatures.
Trade is also on a mission to save the environment. Nearly one-third of all carbon emissions stem from HVAC and refrigeration systems, Lamach noted, and Trane is working on systems to eliminate those emissions.
"Profits over purpose," has always been the mantra of corporations, Lamach said, but at Trane, investors don't have to choose, they can have both.
Executive Decision: Bed, Bath & Beyond
Tritton said he's been encouraged by their performance as more and more stores reopen for business. He said there continues to be signs of strength and balance and even some slight market share gains.
Tritton was also upbeat about the company's Bye Bye Baby franchise, noting that after focusing on their flagship Bed Bath & Beyond stores, they are turning their attention to this great brand that has huge upside potential.
When asked about their recent turnaround, Tritton noted that Bed Bath & Beyond has listened to their customers, who asked them to reduce the visual clutter and confusion. Their new remodeled stores have a refreshed look, cleaner sight lines, fewer items and clear values that are easy to find. Thus far, the metrics in remodeled locations have been terrific.
Bed Bath & Beyond continues to invest in the business, Tritton added, putting money to work in stores, technology, supply chains and in the communities it serves. The company aims to have net-zero carbon emissions by 2040.
Executive Decision: PagerDuty
Tejada explained that as more companies make their digital transformations, digital operations management has become essential infrastructure. This has only grown in importance as employees began working remotely or in hybrid environments.
PagerDuty isn't just for technology outages, Tejada continued. The company's platform can notify key personnel about a whole host of issues and facilitate effective and efficient responses to unforeseen events. That's how 60% of the Fortune 100 has come to rely on PagerDuty.
When asked about her company's results, Tejada said growth remains a priority for PagerDuty, but they always grow in a measured and sustainable way.
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Ford vs. General Motors
Cramer admitted that GM just put up terrific earnings, which sent shares up a quick 4%, and he's a big fan of CEO Mary Barra. However Farley's a car guy, and a car guy that's committed to making money on every car he sells.
That may seem like Business 101, but Ford's previous strategy was to be the world's automaker, participating in every market, even if those markets weren't profitable. But Farley has focused on profits, and that makes all the difference.
Here's what Jim Cramer had to say about some of the stocks that callers offered up during the "Mad Money Lightning Round" Wednesday evening:
Fastly FSLY: "They did not have a good quarter and they just lost their CFO. I can't recommend it."
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At the time of publication, Cramer's Action Alerts PLUS had a position in AMZN, FB, AAPL, GOOGL.