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Investors who only focus on rising interest rates are going to miss out on opportunities, Jim Cramer warned his Mad Money viewers Tuesday. There's a lot more going on in the stock market than just the Federal Reserve.
Cramer said there is an entire generation of younger investors out there -- call them the quantitative easing generation -- that only know a world of low interest rates. But Cramer reminded everyone that stocks can do exceptionally well when the economy is humming and interest rates are on the rise.
Sure, super-low interest rates are a win for dividend stocks, and they allow companies to borrow money on the cheap for big stock buybacks and to make big acquisitions. But that doesn't mean the party ends with the first or second quarter-point rate hike.
This is especially true with Donald Trump heading to the White House. Unlike the current administration, which favors labor, the environment and the consumer, Trump is pro-business through and through, Cramer said. Gridlock in Washington may finally be over, which only makes stocks more compelling.
Instead of being on a Fed-induced respirator, imagine an economy that could breathe, and grow, on its own, Cramer concluded. That could restore the luster of stocks as an asset class.
A Special Invitation
It's not how you voted, it's how you invest. So how can investors win in the wake of this historical election? If you're planning to be in New York on Tuesday, Dec. 6, you are invited to join senior editors from TheStreet and our special guest experts for a cocktail party and lively conversation about the outlook for the U.S. financial markets. Which companies and sectors are poised to profit? What shocks and opportunities await investors in the new year? Listen to and meet our panelists: Lew Altfest, CEO of Altfest Personal Wealth Management; Barry Ritholtz, founder of Ritholtz Wealth Management; and Larry Siegel, director of research at the CFA Institute Research Foundation, with moderator Robert Powell. Opening remarks by JJ Kinahan, chief strategist, TD Ameritrade. This evening event is free and will be held at The Harvard Club of New York. Reservations are required. For more information or to RSVP, please email email@example.com
Executive Decision: Thor Industries
In his "Executive Decision" segment, Cramer spoke with Bob Martin, president and CEO of Thor Industries (THO) , the RV maker with shares that rose 12.6% today after the company posted a 26-cents-a-share earnings beat. Shares of Thor are up over 82% for the year.
Martin said that the RV market has typically been cyclical and investors were never quite sure when the upswing would occur. But Thor has seen strong growth and expects that to continue for many years.
Martin attributed that growth to a wave of younger customers that are being attracted by innovative new products and lower price points. He said younger people are finding new uses for RVs, from attending their kids' soccer games in style to tailgating and other events. Once a customer starts camping in an RV, they tend to stick with it, Martin said, and upgrade to bigger and better vehicles as they age.
Martin addressed the need for more luxury campgrounds and destinations by saying that as more and more people get into camping, those destinations will be built.
Cramer said that Thor shares are not done and have room to move higher.
Stay the Course
Staying the course may seem like the toughest of action, Cramer told viewers, but ringing the register and selling too early will likely cost you.
It's a common trend in recent days, analysts downgrading stocks and taking victory laps after a quick 10% or 15% gain. But the real question is, will these analysts be able to get back in?
With the Republicans in control of both Congress and the White House, it will not be business as usual in Washington, Cramer posited. A lot more legislation will be passed and government shutdowns and debt ceiling wrangling will hopefully become a distant memory.
That's why Cramer urged investors to keep their positions and not take profits prematurely. The hardest course may be to stick around, but it will likely be the most profitable as well.
Executive Decision: EPR Properties
In his second "Executive Decision" segment, Cramer spoke with Greg Silvers, president and CEO of EPR Properties (EPR) , the recreation REIT with a 5.4% dividend yield.
Silvers first commented on his company's recent deal to acquire assets from CNL Lifestyle and help another company, Och-Ziff Capital Management (OZM) , finance the purchase of the assets EPR is not interested in. He said that the CNL shareholder vote will be happening early next year and the deal will be accretive. Silvers expects many CNL shareholders to hold onto their EPR shares, but noted that EPR will consider a stock buyback if necessary.
Once completed, Silvers said that EPR will be the leader in recreational experiences, with about 10% of their properties being ski resorts.
Silvers was also bullish about EPR's charter school portfolio, which should be getting a tailwind from the Trump administration, and also their casino properties. He noted that their Top Golf properties also continue to see success.
In the Lightning Round, Cramer was bullish on American Electric Power (AEP) , Zimmer Biomet (ZBH) , Amgen (AMGN) , Kohlberg Kravis Roberts (KKR) , Impinj (PI) , NVIDIA (NVDA) , Dow Chemical (DOW) and HEICO (HEI) .
In his "Homework" segment, Cramer followed up on a few stocks that had stumped him during earlier shows.
He said that Tetra Tech (TTEK) fills an interesting niche, but the stock has run near all-time highs and may not be the best way to play the incoming Trump administration.
Cramer's verdict on medical device maker Penumbra (PEN) was also bullish, but he said to wait for a pullback before buying.
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At the time of publication, Cramer's Action Alerts PLUS had a position in CMCSA, WFC, C, AEP and DOW.