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When fear trumps rational thinking, that's when sellers remorse can set in, Jim Cramer told his Mad Money viewers Thursday. Worry will only keep you from making money, Cramer continued, as he highlighted five stocks that plummeted on earnings, only to rebound sharply afterwards.
The same pattern emerged when Clorox (CLX) reported. Shares immediately fell from $131 to just $124, but upon further review, the bulls prevailed, taking shares right back to $131.
Still other stocks, like Allergan (AGN) and Salesforce.com (CRM) both proved the short-sellers wrong when they rose 11 points and 11%, respectively. Even the analysts got the narratives wrong on these stocks, Cramer noted.
Executive Decision: Patrick Doyle
For his "Executive Decision" segment, Cramer spoke with Patrick Doyle, president and CEO of Dominos Pizza (DPZ) , which today delivered a 5-cents-a-share earnings beat on a 15% rise in revenue and a stellar 10.7% rise in same-store sales. Shares of Dominos closed higher by 13% at a new all-time high.
Doyle said Dominos is firing on all cylinders, with food, service, technology and advertising all driving their business forward thanks to excellent execution. He said Dominos' franchisees are also excited and can feel the momentum.
Doyle also spoke to value as another driving force at Dominos. The chain hasn't raised the price on their primary offerings for over five years and customers always know what they're going to get.
Cramer said Dominos is everything an investor could want out of a stock.
Not so Supervalu
When it comes to stocks, cheap is not enough, Cramer reminded viewers, as he chronicled the rise and fall -- or more accurately the fall, rise and fall -- of supermarket chain Supervalu (SVU) .
Shares of Supervalu had fallen from $50 to just one dollar in the years leading up to and during the recession. But then, as if back from the dead, a turnaround ensued that rallied shares up 614% from 2013 through the middle of 2015. But just as quickly as the rally came, it went, with shares ultimately closing down 30% by the end of 2015 and another 30% so far this year.
So what's going on at Supervalu? Cramer said after completing some high-priced acquisitions and weathering the recession that immediately followed, Supervalu was able to stay alive, restructure its operations and its debt and begin to turn itself around. The company saw higher revenues, improving margins and strong same-store sales growths that kept investors piling in.
But Supervalu was nothing more than a turnaround story. When revenue missed estimates in mid-2015, institutional investors began heading for the exits and haven't looked back.
Cramer said while stock is now very cheap, there's no confidence management can do anything to stem the declines. In a tough market, he advised sticking with best-of-breed Kroger (KR) .
Best Value Wins
Whoever offers the best value wins. That may seem like common sense, but eight years after the great recession, consumers haven't yet forgotten this important lesson.
Even with gas prices at record lows and more money flowing into consumers' pockets, the restaurants and retailers that offer the most value have proven to be the biggest winners this quarter.
Meanwhile, discount retailer TJX Companies (TJX) had only great things to say about its Home Goods chain which sells, you guessed it, discount accessories for your home.
In the Lightning Round, Cramer was bullish on Cedar Fair (FUN) , Six Flags (SIX) , Weyerhaeuser (WY) , First Solar (FSLR) , AMN Healthcare (AHS) , Dominion Resources (D) , American Electric Power (AEP) and Consolidated Edison (ED) .
Am I Diversified?
In the "Am I Diversified?" segment, Cramer spoke with callers and responded to tweets sent via Twitter to @JimCramer to see if investors' portfolios have what it takes for today's markets.
Cramer said he wanted to see no Chinese stocks in this portfolio to be better diversified.
Cramer said this portfolio can't have both Nike and Foot Locker, nor both Microsoft and Twitter. He advised selling Foot Locker and Twitter and adding a drug stock and an industrial.
Cramer said this portfolio was properly diversified.
To watch replays of Cramer's video segments, visit the Mad Money page on CNBC.
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