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Cramer's Mad Money Recap 10/20: Tesla, Amazon, Netflix

Jim Cramer says that despite the bears' barrage of negativity, these three companies are now among the most successful and have made smart investors a lot of money.
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It's time to end the ridiculous charade of bearish billionaires trying to keep you out of the stock market, Jim Cramer told his Mad Money viewers Wednesday. These bears have been negative for ages, and they're always giving the worst advice to investors.

When you're on TV, being bearish always appears to be smart and credible. That's why they're always given the benefit of the doubt, even though they're always wrong. But the reality is that the super rich don't play by the same rules as you and I, which explains why they're always so negative.

Following Tuesday's Action Alerts PLUS portfolio moves that saw Bob Lang and Chris Versace add starter positions in BlackBerry  (BB) - Get BlackBerry Limited Report and Skyworks Solutions  (SWKS) - Get Skyworks Solutions, Inc. Report, they're back on Wednesday for a big cup of Starbucks  (SBUX) - Get Starbucks Corporation Report. Read about their portfolio changes, why they think Starbucks is brewing good things, and more of their investing insights.

The super rich only care about inflation, and especially wage inflation. That's because inflation eats away at their fortunes and forces them to pay more to maintain it. That's not the case for the little guy who's trying to get rich in the first place.

There are three stocks that the super rich bears are always proclaiming are heading to zero, and tonight, Cramer debuted a new acronym for them. The acronym was TAN, which stands for Tesla  (TSLA) - Get Tesla Inc Report, Amazon  (AMZN) - Get Amazon.com, Inc. Report and Netflix  (NFLX) - Get Netflix, Inc. (NFLX) Report.

Remember the days when Amazon was just a bookseller that could never survive against Walmart  (WMT) - Get Walmart Inc. Report? Or when Netflix was "wasting" all of its money on original content? How many times was Tesla proclaimed dead? Too many to count.

Despite the endless barrage of negativity, these three companies are now among the most successful companies of all time. They've also made their shareholders millions, but only if you ignored the bears.

The super rich tend to only talk positively about the stocks they own and pan everything else, Cramer concluded, and that's why individual investors shouldn't take their cues from them and should do their own homework instead.

Executive Decision: Qualtrics International

In his first "Executive Decision" segment, Cramer spoke with Zig Serafin, CEO of Qualtrics International  (XM) - Get Qualtrics International Inc. Report, as well as Ryan Smith, the company's founder and executive chairman. Shares of Qualtrics are up 47% year to date.

Serafin said Qulatrics had an outstanding third quarter that included 49% subscription growth. That growth was fueled by their ability to help customers capture, analyze and act on their data like never before.

Companies today are competing for both customers and talent, Serafin noted, and relationships are built on understanding the unique needs of every person. Smith added that experience is the new currency of business and companies need to measure and understand the impacts of their decisions before they make them.

Serafin touted their recent acquisition of Clarabridge for $1.1 billion by saying that the combined company now has the ability to analyze both direct and indirect feedback. Clarabridge's conversational analytics is able to assess the intent and sentiment and adds greatly to the Qualtrics platform.

The Netflix Opportunity

Netflix posted spectacular earnings Wednesday, but shares still plunged by the close. Cramer called that a rare buying opportunity.

When stocks sell off after reporting, that typically means that shares had run up too far, too fast going into the release. This was true with Netflix, which saw inline revenues but better-than-expected earnings. The company also added 4.4 million net new subscribers in the quarter.

But more important than the numbers is the narrative Netflix was able to tell. It correctly predicted that the pandemic was pulling forward some of its growth, but maintained that subscribers would return once production resumed and new content began rolling onto the service. That was certainly the case with Squid Game, the low-cost South Korean TV drama that is now topping the charts in 94 countries around the globe.

Netflix did provide investors with cautious guidance for next quarter, but that's the norm at Netflix. Cramer said he's bullish on the company's desires to expand outside of movies and TV shows and into gaming and entertainment-related merchandise.

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Executive Decision: Hain Celestial

For his second "Executive Decision" segment, Cramer also spoke with Mark Schiller, president and CEO of Hain Celestial  (HAIN) - Get Hain Celestial Group, Inc. Report, the food conglomerate that's in the middle of a notable turnaround.

Schiller explained that Hain has successfully moved from a holding company to an operating company and in the process has sold 23 of its original 55 brands. That has left the company with plenty of cash to invest and reinvigorate its remaining brands, all of which are now profitable.

Earth's Best was a huge brand for Hain, Schiller continued, but also one that made absolutely no money. With lots of work, Hain has been able to exit several low-margin categories and refocus the brand in a handful of categories that matter. He said Earth's Best now has the margins to warrant continued investments and innovations.

Schiller added that Hain was a pioneer in plant-based meat and is also a leader in non-dairy beverages, two hot categories that also have a lot of growth ahead now that his company has the focus it needs.

Stay Home or Go Out?

In his "No Huddle Offense" segment, Cramer said in the battle between the stay-at-home stocks and the "going out" stocks -- he's betting on going out.

When the pandemic began, it became clear that stocks like Zoom Video  (ZM) - Get Zoom Video Communications (ZM) Report were poised to take over the world, while airlines like United Continental  (UAL) - Get United Airlines Holdings, Inc. Report were going to be in trouble as international travel ground to a halt.

But now that international travel is starting to pick up, people have a deep desire to get out of the house, which makes United the place to be. Cramer was still bullish on Zoom, but he said the company needs to diversify into something more than just video conferencing. He liked Zoom's proposed merger with Five9  (FIVN) - Get Five9 Inc. Report, but now that the deal fell through, Zoom just doesn't have a lot of growth ahead of it.

Lightning Round

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

FIGS  (FIGS) - Get FIGS, INC. Report: "I think it's quirky, but why not?"

Indie Semiconductor INDI: "I like that, but ON Semiconductor  (ON) - Get ON Semiconductor Corporation Report is even better."

MP Materials MP: "People want a rare earth play, but this one needs to do more to get away from China."

Veritiv  (VRTV) - Get Veritiv Corp Report: "I like this one more than International Paper  (IP) - Get International Paper Company (IP) Report, but let's be careful, it's had a big run."

AppHarvest APPH: "This is a learning lesson that isn't as viable as I thought."

XL Fleet  (XL) - Get XL FLEET CORP. Report: "They came on the show and the story sounded OK, but it turned out not to be OK."

Celanese  (CE) - Get Celanese Corporation Report: "This one is a win and is still very inexpensive. "

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