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NEW YORK ( TheStreet) -- Why dwell on the negatives in the market when there are so many reasons to love stocks? Jim Cramer asked on "Mad Money" Monday. Even billionaire Warren Buffett confirmed in an interview today that stocks are the best investments out there while government bonds remain the worst, Cramer said.. He added that what smart investors like Buffett see in stocks is the incredible value being created by companies taking control of their own destinies. That was certainly the case for Hess ( HES), which announced Monday it is spinning off its refining business and going "all in" on its Bakken shale assets. Cramer noted that activist investors at Hess want even more and calling for the company to sell itself entirely, making it a win-win situation for investors. Other activist investors have been shaking value out of companies such as Transocean ( RIG) while multiple hedge funds continue to battle it out over Herbalife ( HLF). Meanwhile, companies such as Yahoo! ( YHOO) are hitting 52-week highs while CEOs like Marissa Mayer are taking action and turning things around in record time. There's also plenty of merger activity bringing out value, said Cramer, and while today's acquisition of Ferro ( FOE) may be a small deal, it's still one in a now-steady stream of deals rewarding shareholders almost daily. Cramer said the only bear market seems to be in Apple ( AAPL), a stock Cramer owns for his charitable trust,
Top of the ChartInvestors who still believe in the promise of natural gas for vehicles, whether they be cars or locomotives, need to keep investing in Chart Industries ( GTLS), Cramer told viewers. While other natural gas stocks have been stumbling, like natural gas engine maker Westport Innovations ( WPRT), down 35% as its 12-liter engines have been delayed, or Clean Energy Fuels ( CLNE), down 32%, Cramer said Chart Industries continues to thrive.
Chart provides the equipment needed to cool natural gas into a liquid form that can be stored or exported, which means its equipment is needed for a host of applications. Cramer said 25% of the company's sales comes from the equipment needed for export, while another 15% comes from equipment used in the initial processing and separation of natural gas as it is first pumped out of the ground. Chart also has a big opportunity in China because the Chinese are planning to ramp up usage of natural gas from 4% to 10% of total energy by 2020. Chart last delivered a five-cent-a-share earnings beat on a strong 38% rise in revenue with orders up 19%. That led to a 7% pop in the stock and helped Chart power to nearly double since Cramer first got behind the name in February 2011. Cramer said that Chart remains inexpensive, even at these levels, trading at just 23 times 2013 earnings with a 26% growth rate.
Cautionary TalesFew things are more damaging to a portfolio than a company cutting its dividend, Cramer told viewers. While this market may be forgiving about many things, mercy is rarely shown when a company cuts its dividend. Such was the case with Atlantic Power ( AT), a $10 stock that was yielding over 10% when Cramer was asked about it during the "Lightning Round" on Feb. 26. At the time, Cramer said that Atlantic's 10% was a red flag because most utilities only yield around 4%. Two days later, Atlantic Power cut its dividend by 65%, sending shares lower by 40%. Cramer said investors could have seen this dividend cut coming by simply looking at the company's financials. Prior to the cut, Atlantic Power's payout ratio -- the amount of its earnings going to its dividend -- was 100%, meaning that every penny the company earned was flowing directly to its dividend. In a case like that, Cramer said either the earnings must increase or the payout must be cut. There are no other options. Atlantic Power follows another high-profile, yet easily predicted dividend cut from regional telco CenturyLink ( CTL), which cut its dividend by 26% on Feb. 14, sending its shares lower by 23%.
Cramer said the moral of these cautionary tales is to never trust management unless the company has earnings to back up its claims. In both cases, company management gave no indication the dividend was in trouble until it was. In some rare cases, management does provide a heads-up, as Excelon ( EXC) did for most of last year. But for the vast majority of cases, the shareholders are the last ones to know unless they're doing their homework.