Monday delivered a lot of analyst downgrades, Jim Cramer told his Mad Money viewers. Even if you disagree with these downgrades, Cramer said, it's always a good idea to listen to what the bears have to say.
In the case of General Electric (GE) - Get General Electric Company Report , analysts felt there was too much optimism surrounding the stock and the problems at GE will take much longer to fix than analysts expect. But Cramer said GE has already told us 2019 would be a reset year and that progress wouldn't come until 2020.
Then there's Boeing (BA) - Get The Boeing Company Report , which is seeing production cuts of its 737 Max aircraft as the fallout from two crashes continues. Cramer said selling Boeing at these levels makes sense. He would also swap out of airlines like Southwest Airlines (LUV) - Get Southwest Airlines Company Report , which rely on the 737 Max, and into other airlines that don't.
Next, Cramer said he's still bullish on Micron Technologies (MU) - Get Micron Technology Inc. Report , even with the stock up 35% for the year. He said the buildout of 5G wireless will propel Micron through any short-term weakness. However, he likes Nvidia (NVDA) - Get NVIDIA Corporation Report even more.
Finally, Cramer said the downgrade of Clorox (CLX) - Get Clorox Company (The) Report may be misguided, as this is a well-run company, while the downgrade of Starbucks (SBUX) - Get Starbucks Corporation Report was merely a victory lap for an analyst with big gains in the stock.
Cramer and the AAP team are analyzing the latest headlines' impact on CVS Health (CVS) - Get CVS Health Corporation Report . 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.
As earnings season gets underway, are investors in for a rude awakening? The Wall Street Journal reported Monday that with the market's sustained run higher, volatility could be in the making as companies are poised to disappoint on the earnings front. Their examples included 3M (MMM) - Get 3M Company Report , FedEx (FDX) - Get FedEx Corporation Report and Walgreens Boots Alliance (WBA) - Get Walgreens Boots Alliance Inc. Report .
But Cramer noted that there's been a growing disconnect between stocks and their underlying fundamentals. When 3M reported disappointing results last quarter, shares did decline initially, but then managed to rally more than $20 from their lows. FedEx shares followed a similar pattern, rallying $19 a share from its post-earnings lows. As for Walgreens, Cramer said the company is indeed performing poorly, but that has nothing to do with the broader economy.
Shares of 3M and FedEx are benefiting from a benign Federal Reserve, Cramer concluded, and will only rally higher if we eventually get a trade deal with China.
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.
When a company with a strong long-term track record suffers a setback, that's the time to buy, Cramer told viewers as he examined the case of Apple (AAPL) - Get Apple Inc. Report , Nvidia (NVDA) - Get NVIDIA Corporation Report and spicemaker McCormick (MKC) - Get McCormick & Company Incorporated Report .
Cramer's been a long-time believer in Apple and the company's CEO Tim Cook. So when shares fell to $142 a share in January, that, he said, was the time to buy. Since then, this Action Alerts PLUS holding has rallied more than 40%, going from zero to hero in the eyes of Wall Street.
Shares of Nvidia followed a similar pattern, falling from $292 a share all the way to $124 in December. But since then, Nvidia has seen a 43% rally as inventory issues have been dealt with. Finally, there's McCormick, which saw a strong rally in 2018 before imploding in the fourth quarter. This stock is now higher by 27% from its lows in early February.
Cramer said all of these gains were "getable" by individual investors if they'd done their homework and believed in the long-term trends working in each company's favor. When the rest of the market is panicking, that's often the best time to be buying.
Executive Decision: 2U
For his "Executive Decision" segment, Cramer spoke with Chip Paucek, co-founder and CEO of online education provider 2U (TWOU) - Get 2U Inc. Report , a stock that's up 36% so far in 2019. 2U recently announced the acquisition of Trilogy Education to grow their online offerings.
Paucek explained that when it comes to graduate degrees, the biggest cost is not the tuition, it's the opportunity cost of having to quit your job and relocate to attend the program. That's why 2U partners with 68 universities to offer online alternatives that can provide the same in-person experience in an online-only or hybrid environment. The company aims to bridge the digital skills divide by making programs accessible to more students.
2U has been a public company for five years, Paucek noted, yet many investors still have never heard of the company or its mission. Paucek said the acquisition of Trilogy was a natural extension to their current offerings. His company is also looking into expanding into under-graduate courses.
Cramer said he's a fan of this for-profit, non-profit partnership between 2U and some of the best universities in the nation.
Off the Tape: Iris Nova
In his "Off The Tape" segment, Cramer sat down with Zak Normandin, founder and CEO of the privately-held Iris Nova, a company set on reinventing the beverage industry by connecting directly with consumers.
Normandin explained that the non-alcoholic beverage market is dominated by large players making sugary drinks. Iris Nova's brand, Dirty Lemon, is a premium product that's no calorie and no sugar and has functional benefits as well. The company has already gotten noticed by big players, like Coca-Cola (KO) - Get Coca-Cola Company (The) Report , which led the company's latest round of funding. Normandin said Coke has validated their concept with their investment.
Iris Nova also has a burgeoning retail presence with two locations called The Drug Store, which feature a grab-and-go concept that works on the honor system. Normandin said two more locations are planned for this year.
When asked about their market, Normandin explained that millennial females have been the primary market for their $10 a bottle premium offerings thus far, but the company is making inroads into other demographics.
In the Lightning Round, Cramer was bullish on Cabot Corp (CBT) - Get Cabot Corporation Report , Ollie's Bargain Outlet (OLLI) - Get Ollie's Bargain Outlet Holdings Inc. Report , Novo Nordisk (NVO) - Get Novo Nordisk A/S Report and Avnet (AVT) - Get Avnet Inc. Report .
Cramer was bearish on Helmerich & Payne (HP) - Get Helmerich & Payne Inc. Report , Amarin (AMRN) - Get Amarin Corporation plc Report , Golar LNG (GLNG) - Get Golar LNG Limited Report and Nio (NIO) - Get NIO Inc. American depositary shares each representing one Class A Report .
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At the time of publication, Cramer's Action Alerts PLUS had a position in CVS, NVDA, AAPL.