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NEW YORK (TheStreet) -- It's all about the expectations, Jim Cramer told his Mad Money viewers Wednesday as he attempted to explain several seemingly counter-intuitive moves as earnings season rolls on.

For many individual investors, buying stocks is simply a matter of buying what you know. However, for institutional investors picking stocks is all about expectations and whether a company is likely to surprise or disappoint based on what Wall Street is anticipating.

That's how stocks likePanera Bread (PNRA) and Buffalo Wild Wings (BWLD) can report mediocre results and see their shares soar, while stocks like Tableau Software (DATA) - Get Report can post a 65% increase in revenue but still see shares plummet 10.6%.

Cramer said UPS (UPS) - Get Report and Norfolk Southern (NSC) - Get Report both surprised Wall Street, which is why their shares rallied, as did Skechers (SKX) - Get Report, which surpassed even heightened expectations, sending its shares soaring by 12.6%.

These moves may seem confusing based on the numbers alone, but when compared to the expectations they make perfect sense.

Cramer on Yelp and Twitter

What should investors make of the horrible quarters from Yelp (YELP) - Get Report and Twitter (TWTR) - Get Report, a stock Cramer owns for his charitable trust, Action Alerts PLUS?

There's no denying that things are bad at both companies, Cramer said, with shares of Yelp plummeting 25% after it reported, while Twitter skidded 14.5% after its release. Both of these companies blew it, he said, as both were big deals that are now rapidly becoming small ones.

Yelp is rapidly becoming irrelevant and needs to sell itself immediately, Cramer said, while Twitter still has hope for a recovery -- but the earliest that is likely to occur is 2016. That makes Yelp a sell and Twitter a wait-and-see situation.

Executive Decision: David Steiner

For his "Executive Decision" segment, Cramer spoke with David Steiner, president and CEO of Waste Management (WM) - Get Report, which reported a 4-cents-a-share earnings beat Thursday on in-line revenue. Shares of Waste Management currently yield 3%.

Steiner said he sees the light at the end of the tunnel for Waste Management as a big part of its business revolves around new housing and business formation, and that volume is expected to turn positive by the end of 2015. New homes being built is not only a win for Waste Management in residential trash collection, Steiner said, but also because more homes means more businesses being built to support those homes.

Steiner said his company has poured lots of money into recycling but now there needs to be a big effort to teach people how to recycle. As things stand now, many things that aren't recyclable get thrown into the recycle bin, making the entire process a lot less profitable.

Finally, when asked about the U.S. economy, Steiner said the "bread and butter" for Waste Management is the small business with a mid-size container that gets picked up twice a week, and that business is starting to improve.

Executive Decision: Sandy Cutler

In his second "Executive Decision" segment, Cramer checked in with Sandy Cutler, chairman and CEO of Eaton (ETN) - Get Report, the industrial that just delivered a not-so-hot quarter with a 3-cents-a-share earnings beat on lighter-than-expected revenue. Shares of Eaton are down 16% from their highs.

Cutler explained that bookings for the quarter were not as strong as the company would've liked, which caused it to lower estimates for the remainder of 2015. However, in order to ensure earnings per share growth in 2016, the company has instituted a restructuring program to help rein in costs accordingly.

In addition to cost reductions, Cutler said Eaton remains committed to a 4% to 5% return of capital to shareholders through its dividend and stock buyback programs.

Among the positive things for the quarter were vehicles and aerospace, Cutler said, but those gains were offset by losses in hydraulics, agriculture and global weakness in construction and mining.

Lightning Round

In the Lightning Round, Cramer was bullish on Enbridge Energy Partners (EEP) .

Cramer was bearish on Pandora Media (P) , Sprint (S) - Get Report and Teco Energy (TE) .

Off the Tape

In his "Off The Tape" segment, Cramer sat down with Mark Slaughter, founder and CEO of the privately held Cohealo, a company helping to contain health care costs by allowing hospitals to share expensive non-emergency surgical equipment, which is only in use 42% of the time, on average.

Slaughter explained that Cohealo is designed ideally for health systems and networks and allows facilities to both find needed equipment from sister locations and also have that equipment delivered in time for scheduled procedures. Medical equipment is expensive to own and expensive to rent but not to share, he noted, especially when most equipment is idle most of the time.

Cohealo makes money by charging hospitals a monthly fee for accessing its service and also by charging for its logistics services.

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