Search Jim Cramer's "Mad Money" trading recommendations using our exclusive "Mad Money" Stock Screener.
You can learn a lot by listening to the footsteps of the thundering herd, Cramer told viewers. When it comes to the oil and natural gas revolution, the herd has spoken time and time again... buy, buy, buy. Today's upgrade of Devon Energy (DVN) is just the latest positive news in the group, Cramer explained, and with new pipelines in the Permian Basin, there's no telling how high these stocks can run.
As for natural gas, Cramer said it's game, set, match as the new EPA rules have made it so there will never be another coal-fired power plant built in the U.S. It's just too costly to use coal, he said, which will be a boon for everyone drilling in the gas-rich Utica and Marcellus shales.
Another positive trend is interest rates, Cramer noted, as we saw a nice rally in Goldman Sachs (GS), a stock which Cramer owns for his charitable trust, Action Alerts PLUS. Cramer also gave the nod to KeyCorp (KEY) and SunTrust (STI), another Action Alerts PLUS name, along with Wells Fargo (WFC).
Still other up trends include the airlines, where Cramer liked American Airlines (AAL), and the packaged food stocks where consolidation is only just getting started.
As for negative trends to avoid, Cramer said any company that's forsaking profits in order to grow, any company that's growing and hiring and issuing more stock and is not returning any to shareholders with buybacks or dividends, well those are the stocks that investors are buying at their peril.
Executive Decision: Julia Stewart
For his "Executive Decision" segment, Cramer welcomed Julia Stewart, chairman and CEO of DineEquity (DIN), purveyors of such venerable restaurant chains as Applebee's and IHOP. DineEquity last reported a blowout 21-cent-sa-share earnings beat on strong same-store sales and shares currently yield 3.8%.
Stewart explained that by selling off just about all of the company-owned locations and becoming 99% franchised, DineEquity has been able to focus on what it does best: mainly branding, technology, operations, training, marketing and culinary innovations. She said that strategy has proven to be very successful.
As for technology, Stewart said there's a big technology push at Applebee's and IHOP that includes not only paying at the table so your credit card never leaves your sight but also loyalty programs and mobile apps, online ordering and a whole lot more. Stewart noted that social media has also been a big focus for DineEquity and it's working very well.
When asked about the company's balance sheet, Stewart said her company plans the refinancing of a big portion of its debt by the end of this year. Once that's complete it will be issuing a new capital allocation strategy that will likely include a boost to the company's already sizable dividend.
Cramer said he hasn't been a big fan of many restaurants but DineEquity is one restaurant that's doing everything right.
Driving With GM
What stock had its best May sales in seven years? It's not the one you'd think, Cramer told viewers: It's General Motors (GM), another Action Alerts PLUS holding.
Yup, that's right. Despite millions of cars being recalled and a permanent spot on the negative headline hall of fame, General Motors was able to post a 12.6% increase in sales for the month of May. It did so without throwing a fire sale and offering uber-promotions on all of its vehicles.
These results were a shock to just about everyone except for Cramer, who made the bold call just four weeks ago that the negativity surrounding GM was far greater than the potential impact on the company's earnings. Cramer said he was panned mercilessly, as is usually the case, for his bold call last month -- but just about all of his predictions have come into fruition.
The negative impact to earnings is baked into the stock, Cramer concluded, it's just going to take Wall Street a few more weeks to realize it.
Executive Decision: Bill McDermott
In his second "Executive Decision" segment, Cramer spoke with Bill McDermott, CEO of SAP (SAP), the old-school tech giant that missed on both revenue and earnings when it reported in mid-April despite its cloud business growing by 38%.
McDermott said SAP is all about its customers, helping take the complexity out of enterprise IT. He said SAP helps companies grow swiftly by providing cloud applications that also integrate with a company's legacy systems.
When asked about some of the recent management changes at SAP, McDermott said its CFO change was a part of a long succession plan and he's very excited to now be SAP's sole CEO.
Turning to the topic of technology, companies like Microsoft (MSFT) partnering with the unlikely choice of Salesforce.com (CRM), McDermott noted that companies often partner where they have weaknesses. In SAP's case, it is strong in a multitude of areas and believes in an open ecosystem to help connect it to partners where needed.
Cramer said SAP's business appears strong and the recent weakness makes the stock the cheapest of the group.
Executive Decision: Mark McLaughlin
In a third "Executive Decision" segment, Cramer checked in with Mark McLaughlin, chairman, president and CEO of Palo Alto Networks (PANW), the cyber security company that just posted a 1-cent-a-share earnings beat on a whopping 49% rise in revenue, sending shares up 50% since Cramer last spoke with McLaughlin six months ago.
McLaughlin said Palo Alto's longstanding lawsuit with rival Juniper Networks (JNPR) is finally behind it, which take a big weight off its, and investors', shoulders.
Turning to the company's sizable growth, McLaughlin noted the cyber security industry is only growing between 5% and 6% annually, so it's clear that Palo Alto's 49% growth in the quarter is a result of taking market share from all comers.
When asked how that's possible, McLaughlin explained most cyber security products are focused only on detecting things after they've happened while Palo Alto's products are focused on both detection and preventing things from happening in the first place. That distinction gives Palo Alto a huge advantage, he noted.
Cramer said that while the cyber security stocks have taken a beaten in recent weeks, Palo Alto is clearly an outlier and deservedly so.
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.
-- Written by Scott Rutt in Washington, D.C.
To email Scott about this article, click here: Scott Rutt