Jim Cramer's 'Mad Money' Recap: Fewer Jobs = Bull Market

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NEW YORK (TheStreet) -- Disbelief is often a hallmark of a powerful bull market, Jim Cramer told his Mad Money viewers Wednesday, and nowhere is that disbelief stronger than in the notion that fewer jobs are better for stock prices.

Cramer said for many investors more jobs equals a better economy and a better economy means higher stock prices. But that linkage simply doesn't exist, he said. In fact, it's just the opposite.

Stocks rise when companies make more money, Cramer explained, and that usually happens when they fire workers, not hire them. For many companies, increasing efficiency by using technology or finding ways to pay fewer taxes is the way to get shares moving. That's why Walgreen (WAG) shares popped on just the rumor that it may move its domicile overseas with a smart acquisition.

Then there's a stock like Dominos Pizza (DPZ), which isn't rising because it's hiring. Instead, Dominos is rising because its online ordering system takes workers out of the mix, thereby increasing accuracy and profits. Cramer said the entire software-as-a-service industry is built on the notion of using technology to do things better and cheaper, with fewer employees.

Aluminum maker Alcoa (AA) is seeing its profits rise, Cramer continued, thanks to closing its high-cost plants. Meanwhile, Union Pacific (UNP) is using its new intermodal hub in New Mexico to move hundreds of trucks worth of freight with just one conductor, rather than hundreds of drivers.

Everyone wants the economy to expand and more people to have jobs, Cramer concluded, but when you're looking at your portfolio, the "less is more" manta is the one that you should be hoping for.

Executive Decision: Manny Chirico

For his "Executive Decision" segment, Cramer sat down with Manny Chirico, chairman and CEO of PVH Corp (PVH), a stock that's up 10% since Cramer last checked in on March 25. PVH just reported a 2-cents-a-share earnings miss, however, on lighter-than-expected revenue while reaffirming full-year guidance.

Chirico said PVH's underlying business remains strong but coming off the difficult winter in the U.S.  the company is finding a more promotional retail environment than originally expected. PVH remains a second-half-of-the-year story, Chirico added, which is why it affirmed guidance.

When asked about sales overseas, Chirico said Italy and southern Europe are still weak but there is growing strength in northern Europe. He said Asia remains another area of opportunity for PVH over the long term.

When asked about the difficulty in meeting those year-end targets, Chirico said he doesn't expect "heroic efforts" in order to meet and beat its targets.

Cramer said he remains a believer in PVH and the strength of its brands.

Off the Charts

In the "Off The Charts" segment, Cramer went head to head with colleague Ed Ponsi over the direction of the big-cap biotech stocks, using the iShares Nasdaq Biotech ETF (IBB).

Ponsi noted that between November and March of this year the biotechs were roaring. But then in late February, after a wave of new IPOs and secondary offerings, the group crashed hard, down 19% in a matter of weeks. The biotechs saw their lows in April and have since been in consolidation mode.

That was until last week, when the group quietly broke above its 50-day moving average and out of a symmetrical triangle pattern.

Ponsi noted that Celgene (CELG), after a 38% retracement, is now signaling a bullish crossover in its MACD momentum indicator.

Other notable biotechs, like Regeneron (REGN), down 20%, is also now signaling strength, as is Isis Pharmaceuticals (ISIS), whose most recent pullback was on very light volume, signaling the buyers are still in control.

Cramer said he's in agreement with Ponsi and feels these great left-for-dead names are once again in bull market mode.

Executive Decision: Robert Greenberg

In his second "Executive Decision" segment, Cramer sat down on location with Robert Greenberg, chairman and CEO of Skechers (SKX) and CFO and COO David Weinberg. Shares of Skechers are up 38% so far this year.

Greenberg said footwear remains a hot commodity and Skechers is one of the few companies that can say it's racing to keep up with inventory and can raise prices if it wants to.

When asked about the company's promotional efforts, which include using celebrities such as Joe Montana and Mark Cuban, Weinberg said in both cases the celebs love Skechers' products so endorsing them was an easy decision. Skechers were also worn by the winner of the Boston Marathon.

How does Skechers move beyond the boom and bust cycles typical of footwear? Greenberg said his is the only company that makes both athletic footwear as well as lifestyle footwear, which helps it stay diversified with stable earnings.

Lightning Round

In the Lightning Round, Cramer was bullish on Exxon Mobil (XOM), Chevron (CVX), Kinder Morgan Energy Partners (KMP), Southern Company (SO), Under Armour (UA) and Access Midstream Partners (ACMP).

Cramer was bearish on Cameco (CCJ), Whole Foods Markets (WFM) and Enable Midstream Partners (ENBL).

No Huddle Offense

In his "No Huddle Offense" segment, Cramer tried to take the pulse of the retail sector but walked away mystified.

Cramer said the retail group has become so hit or miss these days, it's almost impossible to predict. Wal-Mart (WMT) was once the king of retail but now seems to have lost its way. Meanwhile, J.C. Penney (JCP) seems on the mend but reliable Macy's (M) didn't make its number.

Earnings at Coach (COH) were a disaster, Cramer noted, but Michael Kors (KORS) -- well, who knows?

Even in the restaurants, the once dependable Panera Bread (PNRA) and Chipotle Mexican Grill (CMG) ended weaker, while the unexpected DineEquity (DIN) blew away the estimates at Applebee's and IHOP.

Cramer's takeaway? Buyer beware.

To watch replays of Cramer's video segments, visit the Mad Money page on CNBC.

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-- Written by Scott Rutt in Washington, D.C.

To email Scott about this article, click here: Scott Rutt

Follow Scott on Twitter @ScottRutt or get updates on Facebook, ScottRuttDC

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

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