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Stock Market Today With Jim Cramer: Sell AT&T

Jim Cramer discusses the latest stock market news, including how to trade AT&T after it exited its media business and sold WarnerMedia to Discovery, a Morgan Stanley analyst's take on Amazon and markets on Monday.

Stocks fell as Wall Street comes off a rough week driven by concerns over what effect rising inflation would have on the U.S. recovery.

TheStreet's Katherine Ross and Jim Cramer discussed breaking news in the stock market. Cramer spoke about how to trade AT&T after it exited its media business and sold WarnerMedia to Discovery, Amazon and markets on Monday.

AT&T's WarnerMedia and Discovery Merger

Telecom major AT&T  (T) - Get AT&T Inc. Report said its WarnerMedia unit was set to merge with Discovery  (DISCA) - Get Warner Bros Discovery Inc Com Ser A Report to create a media giant valued at $43 billion.

WarnerMedia owns cable channels such as HBO, CNN, TNT and TBS as well as the Warner Bros. television and film studio.

Cramer said it's time to sell AT&T stock because they are cutting their dividend in half. Cramer also said "the Discovery-WarnerMedia combination should never have been made in the first place."

"AT&T is up which gives you a chance to reposition if you want yield," he added.

Cramer also said, "I think Discovery is too low given the fact that they have this great asset. But I don't like the communications business as much as I like Facebook  (FB) - Get Meta Platforms Inc. Report, Amazon  (AMZN) - Get Amazon.com Inc. Report and Google  (GOOGL) - Get Alphabet Inc. Report. They have the money, they have had the balance sheets," he added.

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Amazon: Buy Or Sell?

Morgan Stanley analyst Brian Nowak on Monday reiterated an overweight rating for Amazon  (AMZN) - Get Amazon.com Inc. Report and a $4,500 price target on the e-commerce giant.

Cramer said $4,000 is the "bare case for Amazon." 

"It's interesting [Nowak is] saying there is going to be a multiple based on earnings and at that point, it's going be cheaper vs other stocks -- that's encouraging," Cramer said.

Monday's Market

Cramer said we should not lose sight of the fact that stocks in the S&P that are up 100% year-to-date, such as Nucor  (NUE) - Get Nucor Corporation Report, are the ones that should be marked for some trimming.

"We're taking contrary action today and that's really important because any stock that has run this much including Nucor, I think you should trim," he said.

Amazon, Facebook and Google are key holdings in Jim Cramer's Action Alerts PLUS member club. Want to be alerted before Jim Cramer adds or removes stocks from his portfolio? Learn more now.