Heavy Lifting: Cramer's 'Mad Money' Recap (Monday 8/10/20)

Jim Cramer says his 'barbell portfolio' was designed for days like this, to help investors keep their balance.
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You need to stick with the "barbell" portfolio, Jim Cramer told his Mad Money viewers Monday. In times of uncertainty like these, investors must maintain a diversified portfolio of quality companies that focus on both the COVID-19 winners and the economic recovery winners.

"Everyone hates the barbell," Cramer admitted, but you can't just own the hot stocks of today. You also need to own some stocks that are out of favor now, but will be in favor again as soon things return to normal.

Today we saw stocks like Marriott  (MAR) - Get Report rally 3.5%, Royal Caribbean Cruise Lines  (RCL) - Get Report surge 10%, and Foot Locker  (FL) - Get Report jump 7.8% on an 18% rise in same-store sales. All of these are economic recovery stocks, Cramer said, and you won't have any of these gains without the barbell.

Ignore the money managers who tell you that you're better off just investing in ETFs and index funds, Cramer told viewers. With a little homework and discipline, you can manage your own portfolio and gains like these can offset losses in other areas.

Cramer and the AAP team are looking at everything from earnings and tariffs to the Federal Reserve. 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.

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Executive Decision: Take-Two Interactive

In his first "Executive Decision" segment of the week , Cramer spoke with Strauss Zelnick, chairman and CEO of Take-Two Interactive  (TTWO) - Get Report, the video game maker that just reported another strong quarter.

Zelnick said while it's true that people play more video games when they're stuck at home, the performance of Take-Two extends beyond just the pandemic. He said their excellent portfolio of titles continues to drive growth.

The video game business used to be episodic and hit-driven, Zelnick explained. When you rebased a title, you saw a few months of success, then you had to come up with another hit. But thanks to downloadable content, games have a much longer shelf life. Grand Theft Auto, for example, was released seven years ago, but this year the game hit another record for recurrent consumer spending.

A great year for Take-Two includes both new hit titles and increased recurrent spending, Zelnick added.

When asked about last year's NBA2K title, which was not well received, Zelnick explained that his company is very self-critical and immediately went to work fixing the game to align with what customers said they wanted.

Cramer said Take-Two remains a great company and he'd buy the stock on any weakness.

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No News Is Better News Than You Think

In a raging bull market, stocks that are in motion tend to stay in motion, Cramer told viewers, and just like Newton's first law, stocks that are heading higher tend to keep heading higher.

Cramer said shares of Novavax  (NVAX) - Get Report continue to rocket higher on no news. The stock has soared 4,385% so far this year despite the fact this company has never successfully brought a vaccine to market. Then there's Sorrento  (SRNA) , the early-stage biotech that's up 537% over the past six months on the promise of its COVID-19 test.

Investors like momentum. That's the only explanation for shares of FedEx  (FDX) - Get Report rallying. Momentum is the reason the banks are able to rally despite a looming wave of defaults and why shares of retailers like Home Depot  (HD) - Get Report and even Bed Bath & Beyond  (BBBY) - Get Report are able to march higher.

There is no news on any of these companies, Cramer concluded. They are simply moving on momentum.

Executive Decision: Inseego

For his second "Executive Decision" segment, Cramer also spoke with Dan Mondor, chairman and CEO of Inseego  (INSG) - Get Report, the 5G wireless provider with shares up 14% this month.

Mondor described the current work-from-home trend as not a spike, but more of a trend that will be with us for a long time. He said it's not just work that's changed, but also schools and learning and even the government that have embraced connecting from anywhere.

Mondor added that Inseego sells to practically everyone, from large enterprises to individual consumer hotspots and government agencies. The company embraces an ecosystem of partners, including chipmaker Nvidia  (NVDA) - Get Report, which provides edge computing capabilities that complement Inseego's 5G hotspots.

Executive Decision: SailPoint Technologies

For his final "Executive Decision" segment, Cramer checked in Mark McClain, co-founder and CEO of SailPoint Technologies  (SAIL) - Get Report, the cybersecurity company with shares up 14% this week and 52% so far in 2020.

McClain explained that SailPoint's identity management technology goes beyond just making it easier for employees to log into their work platform. He said their governance platform also looks at what systems employees should have access to and whether they're supposed to be logging in at all.

SailPoint is a business-to-business identity provider, McClain added, but they also differentiate themselves by their ethos of doing right by all of their stakeholders, something that's come front and center in recent months.

Lightning Round

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

L3Harris Technologies  (LHX) - Get Report: "I think this stock has bottomed. I also like Lockheed Martin  (LMT) - Get Report."

Evolent Health  (EVH) - Get Report: "I think this would have gone higher if not for this rotation. It's not going to work right now though."

Alteryx  (AYX) - Get Report: "I like Alteryx, but it will take a little time to repair itself. You need to wait for another quarter."

Digi International  (DGII) - Get Report: "This stock intrigues me. In a few days, I'd be a buyer."

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