We're in a bizarre market where everything that was loved last year is now despised, Jim Cramer told his Mad Money viewers Wednesday. This rotation has been brutal for tech and the stay-at-home stocks, and it's not likely to end until the Federal Reserve raises interest rates or the economy cools.
Cramer said the promise of a reopen economy and additional stimulus has set investors into a buying frenzy. Essential retail is out, he said, and specialty retail is back in vogue. That's why shares of Nike (NKE) - Get Report fell Wednesday, as investors swapped into stocks like Foot Locker (FL) - Get Report, despite that company posting miserable earnings. So while Target (TGT) - Get Report is selling off, Bed Bath & Beyond (BBBY) - Get Report is surging.
Investors are also clamoring for travel and leisure stocks, with Royal Caribbean (RCL) - Get Report hitting new highs and United Airlines (UAL) - Get Report rallying 2.5% after the company issued 37 million additional shares.
Cramer said this rotation won't end until interest rates take a breather. In the meantime, investors should be patient and can start buying well-run tech companies at lower levels.
Executive Decision: Emergent Biosolutions
In his first "Executive Decision" segment, Cramer spoke with Bob Kramer, president and CEO of Emergent BioSolutions (EBS) - Get Report, a company playing a key part in the vaccine manufacturing process. Shares of Emergent are off 20% from their recent highs however, trading around just 10 times earnings.
Kramer said his team has done an amazing job over the past year, ramping up manufacturing for both the Johnson & Johnson (JNJ) - Get Report and AstraZeneca (AZN) - Get Report vaccines from zero to almost 100 million doses a month. Emergent's manufacturing lines are now running 24/7, he said, and the company is on track for one billion COVID vaccine doses annually.
When asked about their post-pandemic plans, Kramer noted that while some investors feel Emergent's growth will slow once the world is vaccinated for COVID, in reality, they have many other businesses that are ramping up nicely to pick up any slack.
Cramer and the AAP team are looking at everything from earnings and politics 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.
On Real Money, Cramer keys in on the companies and CEOs he knows best. Get more of his insights with a free trial subscription to Real Money.
Executive Decision: Wendy's
For his second "Executive Decision" segment, Cramer also spoke with Todd Penegor, president and CEO of Wendy's (WEN) - Get Report, the nation's second largest fast food restaurant chain, which saw its share plunge 5.5% after reporting strong earnings.
Penegor started off by saying that sales of Wendy's new breakfast offerings, along with customer satisfaction, remain strong, with repeat sales as well. That will only increase over time, as awareness grows, he said.
Wendy's remains very optimistic for the reopening of the economy, Penegor added. The average number of visits per customer has fallen to 5.2 from their pre-pandemic levels of 5.5, he said, but as dining rooms reopen and people discover their breakfasts, they should easily eclipse those numbers.
Wendy's still has opportunities to improve efficiency with mobile ordering and pickup, new product offerings like jalapeño chicken sandwiches and also with international expansion into Europe and beyond.
All of these are huge opportunities for Wendy's, Penegor said.
Executive Decision: American Electric Power
For his final "Executive Decision" segment, Cramer checked in Nick Akins, chairman, president and CEO of his favorite utility, American Electric Power (AEP) - Get Report. While utilities have fallen out of favor recently on Wall Street, shares of AEP trade for just 16 times earnings with a 4% dividend yield.
Akins first responded to the catastrophic power failure in Texas. He said extended weather events like that in Texas test electric systems. As generation plants froze and left the grid, operators had no choice but to shed load in order to compensate, leaving millions in the dark.
Electrical systems need resiliency, they need reserves and they need weatherization, Akins continued. But most importantly they need market structures willing to pay for that resiliency. In Texas, there were no incentives to maintain a resilient grid.
Turning to AEP's business, Akins said that residential load continues to be strong, but they're beginning to see the signs of a recovery in industrial and commercial load, which they would expect to see as the economy reopens.
Finally, when asked about renewable energy, Akins said that AEP is responding to what their customers want. He said more and more, large companies are asking for clean, renewable power and AEP is happy to deliver. They're supporting the transition to electric vehicles both with upgrades to the grid and also with charging station partnerships.
Rush to Re-open
In his "No Huddle Offense" segment, Cramer commented on what he called the "complete insanity" of states like Texas eschewing the advice of health officials and reopening their economies too early.
What's the point of putting people at risk?, Cramer asked. We finally have a national effort to fight the virus and hundreds of millions of doses are just 10 weeks away. Now is not the time to invite another wave of a deadly variant in the name of commerce. Now's the time to buckle down, stay vigilant and ensure that in just two or three short months we can finally put COVID in the rearview mirror once and for all.
Here's what Jim Cramer had to say about some of the stocks that callers offered up during the "Mad Money Lightning Round" Wednesday evening:
Search Jim Cramer's "Mad Money" trading recommendations using our exclusive "Mad Money" Stock Screener.
To watch replays of Cramer's video segments, visit the Mad Money page on CNBC.
To sign up for Jim Cramer's free Booyah! newsletter with all of his latest articles and videos please click here.
At the time of publication, Cramer's Action Alerts PLUS had a position in FB.