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NEW YORK (TheStreet) -- Stop, wait and don't rush to buy on the weakness created by today's airline tragedy, Jim Cramer warned his Mad Money viewers Thursday. Cramer said patience is warranted in situations like these as we simply don't know any of the facts.
Cramer called the downing of a Malaysian airliner a tragedy and a horrible loss of life, adding that those who would buy stocks on the market's weakness are premature.
Cramer said he's often advocated buying stocks on global induced weakness but this case is different. First, he said the markets are only down fractionally; more important, we simply don't know the facts. The markets will respond differently to a terrible mistake versus an act of terrorism, he warned.
In order to effectively buy into weakness, you need to have conviction. With today's news, investors are likely to continue taking profits Friday as they fear what might happen over the weekend. Add to that increased tensions in Israel and plummeting interest rates and there's simply too many questions to have any certainty at all.
The markets will take a few days to digest today's news and the general uncertainty going into the weekend, Cramer concluded. Until then, the bias will be to continue taking profits, so investors need to remain cautious.
Stay the Course
Why don't investors like this market? Maybe it's because everything you've learned about stocks just isn't making you any money right now. Cramer said the markets have so many cross-currents running through them at the moment and the tried-and-true fundamental analysis just isn't working anymore.
Why are interest rates so low even though the economy is improving every quarter? How can auto sales be strong but earnings at AutoNation (AN) be so bad that shares fell 8%? How can the transports be up so much even though oil is still over $100 a barrel? Cramer said questions like these do indeed make investing for the home gamer a challenge.
We've never seen so many activist investors taking the worst stocks and making them buys, Cramer continued, nor so many hostile takeovers. Even the always reliable theory that says to buy Yum! Brands (YUM) based on how well KFC is doing in China fell apart in today's session.
But despite all of these contractions, Cramer said investors still need to follow their convictions and stay the course until things eventually return to their natural order.
Investors looking for value in the retail sector need to think like a private equity manager, Cramer told viewers as he highlighted two down-but-not-out retailers that would make perfect leveraged buyout targets.
Cramer explained that earlier this year, Jones Group was taken private after its shares had fallen from $40 to just $9. The company's new private equity owners promptly cut costs, shed brands and made the firm far more attractive with a typical "shrink-to-grow" strategy. Lately we've heard that a similar deal is near with Express (EXPR), with a private equity firm already gobbling up a 9.9% stake in the company.
So which retailers could be next? Cramer said that Chico's Fashions (CHS) is one such retailer, which shares down 20% so far in 2014. Chico's has good brands and a good international story, and Cramer said private equity could pay up to $21 a share, or a 29% premium, for Chicos.
Another likely target: DSW (DSW), a stock that's fallen 36% in 2014, but still yields 2.8% and has $6 a share in cash on its books. Cramer said DSW is poised to turn itself around even without a private equity deal, which makes this stock a double win.
Executive Decision: Nick Pinchuk
For his "Executive Decision" segment, Cramer spoke with Nick Pinchuk, chairman, president and CEO of Snap-on Tools (SNA), the toolmaker that's seen its shares rally 7% since Cramer last checked in back in April and 4% today on the company's strong earnings.
Pinchuk reiterated that Snap-on is constantly pushing to get better, and that's helped by the fact that the repair challenges keep changing as cars keep changing. Even though the company's hand tools are guaranteed for life, Pinchuk said repair technicians are still buying new tools every day because newer cars demand that "perfect" wrench or tool to get into those newly-designed tight spaces.
Trucks represent another challenge, Pinchuk continued. Heavy trucks continue to get more complicated and only Snap-on has the diagnostics to understand the potpourri of data today's state-of-the-art engines produce. Snap-on also has the best database of engine error codes to quickly help car and truck techs find and fix problems quickly.
Cramer said he continues to like the Snap-on story.
Executive Decision: Chuck Bunch
In his second "Executive Decision" segment, Cramer spoke with Chuck Bunch, chairman and CEO of PPG Industries (PPG), a stock that's up 415% since Cramer first recommended it some five years ago.
Bunch said that despite the disturbing events out of Ukraine today, Europe remains an important market for PPG and will continue to be. He said the company is seeing modest growth in the region and with lots of work have increased its bottom line in Europe.
Bunch was also bullish on Mexico after his company's recent acquisition of Comex, a leading provider of architectural coatings in the region. Bunch said that Comex operates in areas that are complementary to what PPG offers and he's proud that 60% of PPG's earnings now stem from outside North America.
When asked about the coatings business overall, Bunch explained that coatings have evolves far beyond just paint. He said coatings are a specialty business with real technology and innovation that offers a high level of service to its customers in everything from aerospace to consumer goods.
Cramer remains bullish on PPG and its continued history of innovation and growth.
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-- Written by Scott Rutt in Washington, D.C.
To email Scott about this article, click here: Scott Rutt