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We're in the sweet spot where analyst upgrades can send any stock higher, Jim Cramer told his Mad Money viewers Monday. With such a powerful incentive to stay long, Cramer said analysts are finding reasons to keep the buy recommendations coming.
Walt Disney (DIS) - Get Report was among the latest round of companies getting upgrades, as analysts ignored declining ESPN subscriptions to focus on the company's solid outlook. Shares of Disney rose 1.3% on the day.
While both of those upgrades were made on backs of solid fundamentals, Cramer noted that others were less so.
Who are the likely candidates for the next round of upgrades? Cramer said he's betting that 3M (MMM) - Get Report will be in the mix, along with Walmart (WMT) - Get Report and especially Home Depot (HD) - Get Report , which should have a strong spring planting season with good comparisons to last year. Investors might also see upgrades on Honeywell (HON) - Get Report and Nike (NKE) - Get Report , Cramer suggested.
Ask the Bulls and Bears
Sometimes, the best way to clarify your own opinion about a stock is to hear what the bullish and bearish pros think.
Fortunately, when it comes to the oil exploration and production company, Cimarex Energy (XEC) - Get Report , investors received both sides on Friday. When analysts go head-to-head, investors win, Cramer said, as an analyst at Wells Fargo (WFC) - Get Report downgraded Cimarex on the same day that Goldman Sachs (GS) - Get Report upgraded it.
According to the bears, most of the positives are already baked into Cimarex, and new oil production in 2017 will only keep a lid on oil prices above $60 a barrel. But according to the bulls, this price ceiling will be a win for companies that can increase efficiency, and among the best in the business is Cimarex.
Cramer said he's siding with the bulls on this one, as he likes both the company's acreage and its execution. While valuations may be stretched at 38 times earnings, Cramer said that number falls to just 26 times earnings when considering 2018 estimates. Plus, Cimarex has a healthy balance sheet, which makes it worth owning.
Cramer and Jack Mohr think Apache's (APA) - Get Report management has positioned the company for growth through both innovation and efficiency. Read what they are telling their investment club members with a free subscription to Action Alerts PLUS.
Coming up in this episode of Mad Money: Cramer interviews Dr. Stanley Crooke, CEO of Ionis Pharmaceuticals (IONS) - Get Report . And, there's Cramer's read on Trump's view of China. Plus, don't miss the Lightning Round. Which stocks in Cramer bullish on?
What's Happening at Nordstrom?
Last year, reports began circulating that American shopping malls are dying off, Cramer said, and last week's report card on Nordstrom only confirmed the trend.
The company admitted that its 2.4% increase in same-store sales last quarter was only helped by its annual anniversary sale. Overall, the company admitted that store traffic has fallen to its lowest levels since... 1972.
Cramer said this stunning decline in traffic cannot be overcome by cost-cutting or closing underperforming stores. Additionally, the company's efforts to enhance its e-commerce efforts are only giving customers less incentive to visit physical stores.
As we've seen this quarter, there are retailers that are thriving in an e-commerce world, mainly TJX Stores (TJX) - Get Report , Foot Locker (FL) - Get Report , Ulta (ULTA) - Get Report and Burlington Stores (BURL) - Get Report . But for the department stores like Nordstrom and rival Macy's (M) - Get Report , there may be no way to change the tide.
Executive Decision: Ionis Pharmaceuticals
For his "Executive Decision" segment, Cramer once again checked in with Dr. Stanley Crooke, chairman and CEO of Ionis Pharmaceuticals (IONS) - Get Report , a stock that is down 20% for the year, but has risen more than 50% since the election.
Crooke said that he's excited about the new chemistry they're developing to treat cardiac diseases, which reduces the doses and increases both potency and convenience for patients. He said the advancements in their technology continue with every trial.
Crooke is also expecting FDA approval in the very near future for Spinraza, his company's drug for spinal atrophy that has provided some astonishing results in clinical trials. He was also upbeat on Ionis' treatments for diabetes and high triglycerides.
With so many ways to win, Cramer said he remains bullish on Ionis.
In his "No-Huddle Offense" segment, Cramer opined on Donald Trump's views about China. He said Trump doesn't want a trade war with China, he believes we're already in one, one that the U.S. might win.
Cramer said that according to Trump's view, America doesn't put up a fight to keep our manufacturing jobs and that needs to change. Is he willing to sacrifice the earnings of companies that sell things into China? It sure seems that way.
That doesn't mean investors need to sell everything with Chinese exposure, Cramer concluded, but it does mean there's a new risk factor out there and we cannot pay as much for these stocks as we used to.
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At the time of publication, Cramer's Action Alerts PLUS had positions in APA, COST, GE, WFC and TJX.