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Sometimes, the action is a stock is easy to explain, Jim Cramer told his Mad Money viewers Wednesday. Case in point, Facebook (FB) , a stock Cramer owns for his charitable trust, Action Alerts PLUS. Facebook reported a monster quarter and the stock soared 6.4%. Then there's Twitter (TWTR) , another Action Alerts PLUS holding, that saw a horrendous quarter and was crushed, down 14.5%.
But other stocks are harder to assess, Cramer said. Panera Bread (PNRA) received a sell rating just before it reported, but still managed to deliver an upside surprise with same store sales up 4%. Meanwhile, Buffalo Wild Wings (BWLD) saw slowing sales, but those didn't seem to matter as the company cut costs and has several new initiatives to bring customers back.
Cramer also called out Caterpillar (CAT) as a perplexing stock. Cat has been in a four-year downturn and has been a sure thing for the short sellers. But today the company beat on both the top and bottom line with excess inventory being worked off and Europe on the mend. Shares closed at a new 52-week high.
Finally there's Boeing (BA) , which didn't look like it was going to have a good quarter but still managed to reaffirm guidance and close up over $1 a share.
Executive Decision: David Steiner
For his "Executive Decision" segment, Cramer spoke with David Steiner, president and CEO of Waste Management (WM) , which reported a 3-cents-a-share earnings beat and a 3.3% rise in revenue along with raised guidance Wednesday, only to see shares sink by 1.8%.
Steiner said he manages Waste Management for the long term and over time, the stock will take care of itself. He said there wasn't a single hole in this quarter's results.
When asked about the loss of some recycling contracts, Steiner explained those contracts had very low margins and are a part of efforts to de-risk the company's recycling business. Meanwhile, in his company's landfill business, volumes increased by 6.5% and show years of growth ahead.
As for Waste Management's biggest growth driver, Steiner said new housing creates not only construction business, but also new residential customers and tons of supporting businesses, such as gas stations and grocery stores, all of which are recurring revenue for his company.
Cramer said Waste Management's stock remains a buy.
Apple Rolls On
How does the biggest stock on Earth manage to rally 6.5% in a single day? That was the question Cramer pondered with Apple (AAPL) , an Action Alerts PLUS holding, after the company shocked Wall Street with its earnings.
Many analysts has been predicting a weak quarter for Apple, citing a shortfall in cell phone sales. These analysts did what they always do, Cramer noted, checking with Apple's suppliers for a gauge of demand. But Apple's suppliers never talk about Apple specifically, making supplier checks largely meaningless.
Cramer said he suspects that even Apple underestimated demand for its phones, as the iPhone was supply constrained in many parts of the globe. The bears also underestimated Apple's service revenue, which boast very high margins that fall right to the bottom line.
In short, the analysts got it wrong, Cramer concluded, which is why he continues to recommend investors own Apple and not trade it.
Executive Decision: Michael McGarry
In his second "Executive Decision" segment, Cramer sat down with Michael McGarry, president and CEO of PPG Industries (PPG) , the coatings giant that posted only inline earnings with weaker revenue when it reported last week.
McGarry said that the coatings business is all about technology and PPG is the leader in making coatings lighter as well as in things like heat management and anti-corrosion. PPG has outperformed estimates for the past four years and still sees big opportunities in both Europe and Asia.
McGarry noted PPG is the number one painter of cars in China and has factories in over 70 countries around the globe.
When asked about the company's growing cash hoard, McGarry said PPG is always looking to put cash to work. Wile acquisitions are preferable, he's not opposed to buying back stock.
Cramer said it's business as usual at PPG and business is always good.
Executive Decision: Michael Neidorff
In a third "Executive Decision" segment, Cramer sat down with Michael Neidorff, chairman and CEO of Centene (CNC) , the health insurance provider that just posted a 20-cents-a-share earnings beat but saw shares fall by 8.5% as investors worried over increasing cash reserves.
Neidorff explained that as a result of recent acquisitions there were problems with certain healthcare plans in California, Arizona and Oregon, all of which were known before the acquisitions closed. He said the problems in Arizona and Oregon were small and quickly resolved, but in California one of the PPO plans was poorly designed and needed changes.
Neidorff continued that Centene has been working closely with officials in California and have submitted changes that have been approved and will go into effect in 2017.
Centene is the same company, Neidorff noted, and it has dealt with all of the issues. He said he was shocked investors took issue with the $390 million increase in cash reserves as all of the issues were public knowledge. Once investors understand the complicated accounting involved, they'll have no issues with Centene.
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