When the market does something stupid, take the opportunity to do something smart, Jim Cramer urged his Mad Money viewers Tuesday. Too many times, the market makes moves seemingly on no news whatsoever, Cramer said, and that's typically the right time to buying into weakness.
Case in point: Apple (AAPL) , which soared 4.9% today on strong earnings that included a strong showing in China and in services overall. Cramer said the lifetime value of an iPhone user is only going up, which makes the sellers of Apple rather confusing.
Then there's Alphabet (GOOGL) , which continued to decline as Google is losing market share to both Amazon (AMZN) and Facebook (FB) . So why then were both Amazon and Facebook down today? Cramer said investors should be turning this stupidity into opportunity.
Most of the consumer packaged goods stocks have been rallying hard on recession fears, Cramer noted. But if the economy is falling into recession, why are the stocks of FedEx (FDX) and UPS (UPS) also rallying? Those stocks fall when the economy weakens.
Finally, Cramer said Occidental Petroleum (OXY) also made a stupid move today when the company took $10 billion from Warren Buffett to fund their Anadarko Petroleum (APC) acquisition at 8% interest. The company could have easily funded the deal at just 5% interest, Cramer said. Occidental didn't need Buffett to make this deal happen. He advised selling both names, even as Anadarko is an Action Alerts PLUS holding.
Cramer and the AAP team say the Anadarko Petroleum (APC) saga may be coming to an end. 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.
Executive Decision: Shopify
For his "Executive Decision" segment, Cramer sat down with Harley Finkelstein, COO of Shopify (SHOP) , the online store provider with shares that are were up 7.8% today after the company reporting strong earnings. Shopify shares are up a hefty 39% since Cramer last checked in with Finkelstein in February.
Finkelstein called Shopify the "entrepreneur company," as they empower small businesses around the globe to sell their goods with the same economies of scale as the biggest retailers. The Shopify platform includes over 820,000 merchants, he said, and if added together, they'd collectively be the third largest online retailer.
Finkelstein added that Shopify levels the playing field for small businesses by providing them with the best tools and rates to compete with anyone. They are a retail operating system that blends online sales with in-store sales, all into a centralized back office with world-class technologies. In fact, even big brands are turning to Shopify to build their direct-to-consumer systems.
Whether you're selling shoes, socks or cosmetics, Shopify has the tools to make your small business a huge success.
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The Hard Truth About Google
There's no easy way to say it, Google is getting its butt kicked by its competitors, Cramer told viewers. That was his takeaway from Alphabet's $1 billion revenue shortfall this quarter and its subsequent conference call, where the company refused to admit its mistakes.
Cramer said it's clear that Google is losing advertising market share to both Amazon and Facebook, but the company is also losing the confidence of analysts by not admitting its problems or offering any plans to fix them. It's no wonder shares fell another 7.5% today on top of earlier losses.
While it's great that Alphabet has a plan to beef up its cloud services to better compete with Amazon and Microsoft (MSFT) , Cramer asked, why did the company let Amazon and Microsoft get such a humongous lead in the first place?
Cramer said he's got little faith in management that won't own up to their mistakes, so for now, Alphabet is no longer a buy.
Executive Decision: Zebra Technologies
In his second "Executive Decision" segment, Cramer sat down with Anders Gustafsson, CEO of Zebra Technologies (ZBRA) , the logistics software provider that saw its shares plunge 6.9% by the close after reporting solid earnings, but with tepid guidance.
Gustafsson explained that while Zebra is still confident in their business, they are seeing their growth rate slow slightly, which prompted a cut in their guidance to remain conservative. He added that Zebra continues to push into more consulting and data services, because no one knows their customers' workflows better than they do.
Zebra celebrates its 50th anniversary this month, and Gustafsson said it's been quite an evolution from mechanical systems 50 years ago, to barcoding services in the 1980s, to today where they are more of an enterprise services company than ever before.
Zebra is helping companies replacing aging Microsoft Windows devices with the latest in Android-powered devices, which increase both speed and efficiency as well as provide a multitude of new services that simply weren't available on legacy products.
Executive Decision: TRI Pointe Group
In his third "Executive Decision" segment, Cramer also sat down with Doug Bauer, CEO of TRI Pointe Group (TPH) , the home builder with shares that dipped 7.6% last week after a run-up going into the earnings.
Bauer said the momentum has shifted from the declines seen late in 2018. He said the consumer has become more engaged now that interest rates are back on the decline. But more important, he said, are the demographic trends that are created demand for homes that are not being met.
Bauer added that while low interest rates help, job growth and wage growth is what really drives the housing market.
When asked about the lucrative California market, Bauer said that TRI Pointe has 11,000 lots in the state, but more needs to be done, especially in Silicon Valley, to bring prices down. He said a more lax regulatory environment would help add supply to relieve that pressure.
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At the time of publication, Cramer's Action Alerts PLUS had a position in APC, AAPL, GOOGL, AMZN, FB, MSFT, CSCO.