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Cramer's Mad Money Recap: Papa John's, Etsy

Jim Cramer says that between stimulus programs and vaccines, it looks like the American economy has weathered the worst of COVID.
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Sometimes, reality can be a lot better than our expectations, Jim Cramer told his Mad Money viewers Thursday. Last year, in the depths of the pandemic, no one thought that science would prevail over COVID-19 so quickly, or that our economy could sustain so many shutdowns and supply chain interruptions.

As the pandemic wore on, pundits began to speculate on what shape the recovery would take. First, they predicted an L-shaped recovery with no upside. Later, they thought we might see a W-shaped recovery with a surge from stimulus payments, followed by a second decline.

But while investors speculated, consumers took their stimulus checks and invested in their homes, paid down debt and boosted their savings. Younger people invested their checks in the stock market. And eventually, American science prevailed, creating highly effective vaccines in less than a year.

What we ended up with wasn't an L, or a W, or a U or even a V, but rather a "Super-V," where it appears stocks are much better off than they were before the pandemic. The implications of such a strong recovery are only now becoming obvious, Cramer said, and that's why stocks are able to continue powering higher.

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Executive Decision: Papa John's

In his first "Executive Decision" segment, Cramer declared a bull market in pizza after speaking with Rob Lynch, president and CEO of Papa John's Pizza  (PZZA) - Get Papa John's International Inc. Report, which just posted a 34-cents-a-share earnings beat that sent shares soaring 7.3%.

Lynch said that Papa John's was one of the first companies to pioneer online pizza delivery over 15 years ago. Today, 70% of their business comes from digital. He said customers get a great experience online and once they've tried it, they come back for the loyalty program and more.

Lynch added that during the pandemic, Papa John's has forged great relationships with delivery services like DoorDash  (DASH) - Get DoorDash Inc. Class A Report. "They need trips and we need drivers," he said, making it a win-win for everyone.

Being a technology-driven company, Lynch said Papa John's has excellent insights into their customers and what they like. That helps with innovation and service improvements that other companies simply can't match.

Executive Decision: Etsy

For his second "Executive Decision" segment, Cramer also spoke with John Silverman, CEO of Etsy  (ETSY) - Get Etsy Inc. Report, the online marketplace that saw its shares plunge 14.5% as the company offered disappointing guidance as it faces difficult comparisons from the height of the pandemic.

Silverman said Etsy just completed another phenomenal quarter, with over 90 million active buyers, including eight million habitual buyers that made six or more purchases. Habitual buyers are up over 200% from last year.

There will always be a market for mass-produced goods, Silverman explained, but as we all became more isolated during the pandemic, more and more people realized that they also need items that are more human and more special. Etsy supports over 4.5 million artisans that are making handmade goods you simply can't find anywhere else.

As the pandemic winds down, Silverman said they're seeing a lot of interest in gardening and outdoor products and influencers around the world are promoting Etsy more than ever.

Cramer said there aren't many opportunities to buy Etsy at great prices, but this is one of them.

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.

Executive Decision: Ping Identity

For his final "Executive Decision" segment, Cramer checked in Andre Durand, CEO of Ping Identity  (PING) - Get Ping Identity Holding Corp. Report, the cybersecurity company with shares up 8.1% today on strong earnings and outlook for the rest of 2021.

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Durand said the clouds are slowly lifting in the enterprise software world and companies are starting to fund more and more projects that require identity services.

Identity sits at the heart of personalization, Durand added. You can't secure what you can't identify, and once you identify a user, you need to span multiple systems and devices to bring all of their accounts and services into one place.

When you think about identity, it's an enormous space, Durand continued. Ping serves the Global 3000 and there's a ton of opportunity still ahead.

Cramer's Anti-Inflation Trade

In his "No Huddle Offense" segment, Cramer said that with inflation on the rise, many investors are following the hedge fund playbook. That, he said, could be a big mistake.

According to the playbook, when inflation is on the rise, you buy a handful of inflation winners and sell everything else. That means buying up the mining and steel stocks like Freeport-McMoRan  (FCX) - Get Freeport-McMoRan Inc. Report, Cleveland-Cliffs  (CLF) - Get Cleveland-Cliffs Inc. Report and Nucor  (NUE) - Get Nucor Corporation Report. It means snapping up Pioneer Natural Resources  (PXD) - Get Pioneer Natural Resources Company Report, Chevron  (CVX) - Get Chevron Corporation Report and Kinder Morgan  (KMI) - Get Kinder Morgan Inc. Report. And it means buying the banks, which do better with rising interest rates. Think Bank of America  (BAC) - Get Bank of America Corporation Report, Wells Fargo  (WFC) - Get Wells Fargo & Company Report and JPMorgan Chase  (JPM) - Get JP Morgan Chase & Co. Report.

But while all of these trades are working right now, Cramer reminded viewers that much of the inflation we're seeing is transitory and self-correcting. We're dealing with shortages, supply chain disruptions, tariffs and port congestion, just to name a few of the market's woes. Once plastic factories finally get back online in Texas, and Japanese foundries resume making semiconductors, much of strength of today will vaporize.

That's why you can't simply follow the playbook and only own the industrials. When inflation corrects, it corrects quickly, and you might find yourself on the wrong side of the trade.

Lightning Round

Here's what Cramer had to say about some of the stocks that callers offered up during the "Mad Money Lightning Round" Thursday evening:

Consolidated Edison  (ED) - Get Consolidated Edison Inc. Report: "I prefer American Electric Power  (AEP) - Get American Electric Power Company Inc. Report. I would not keep ConEd."

Atkore International Group  (ATKR) - Get Atkore Inc. Report: "This is a great little company. If it would pull back, I'd buy it."

Innovative Industrial Properties  (IIPR) - Get Innovative Industrial Properties Inc. Report: "That's a smart way to play the cannabis sector. "

Aurinia Pharmaceuticals  (AUPH) - Get Aurinia Pharmaceuticals Inc Report: "That one's not doing well. They're losing a lot of money."

LM Ericsson  (ERIC) - Get Ericsson Report: "I think Nokia  (NOK) - Get Nokia Corporation Sponsored American Depositary Shares Report is a better buy."

Petco Health & Wellness  (WOOF) - Get Petco Health and Wellness Company Inc. Report: "I am a believer in Petco. That's a terrific stock. There's room for them and Chewy  (CHWY) - Get Chewy Inc. Class A Report."

Madison Square Garden  (MSGE) - Get Madison Square Garden Entertainment Corp. Class A Report: "I think that's a good stock. I like it a lot."

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