Search Jim Cramer's "Mad Money" trading recommendations using our exclusive "Mad Money" Stock Screener.
When the next "flash crash" occurs in the market, investors need to be ready, Jim Cramer told his Mad Money viewers Wednesday on the one-year anniversary of the last time the machines ran amok. We may not know what's causing the crash when it happens, Cramer said, but that doesn't mean we still can't profit from it.
The stock market has only seen the flash crash phenomenon twice, once in 2010 and most recently a year ago. During both of those events the markets plunged without notice, only to inexplicably recover just as fast.
Cramer was on the air in 2010, watching Procter & Gamble (PG) sink 25% in the blink of an eye. He commented then that Procter's price was simply not real and told viewers to buy it right then, on the spot. Investors taking Cramer's advice profited 25% in the minutes that followed.
Cramer said he knew that Procter was a safe bet down 25% as the company was not economically sensitive, it paid a solid dividend and its share were liquid enough to get in and out in a hurry. He emphasized that in fast-moving situations, investors must alway use limit orders, which allow them to buy shares at the price they want to pay.
As for what to buy the next time, and there will be a next time, the markets tank, Cramer said he still likes Procter, now an Action Alerts PLUS holding, along with General Mills (GIS) , PepsiCo (PEP) and Dominion Resources (D) . He would also consider American Electric Power (AEP) , Verizon (VZ) and rival AT&T (T) , all of which are great stocks in a machine-induced panic.
Executive Decision: Manny Chirico
For his "Executive Decision" segment, Cramer sat down with Manny Chirico, chairman and CEO of apparel maker PVH (PVH) , which just posted an 18-cents-a-share earnings beat on a 4% rise in revenue and raised its full-year guidance for the rest of 2016.
Chirico said that last year the third and fourth quarters were simply a disaster, but this year the fall season is looking much better with inventories very much under control. That means there are big opportunities to boost the bottom line.
Chirico commented on Macy's (M) decision to close 100 stores. He said it's been known for a long time that America has too many stores, and Macy's is taking brave steps to rectify the problem. Retailers need to go where the consumer is, and for many that's online and not as much at brick-and-mortar locations. That said, Chirico said physical stores aren't going away anytime soon.
Also, Chirico commented on Speedo's decision to end their relationship with Olympic swimmer Ryan Lochte. He called the situation unfortunate but said PVH cannot endorse Lochte's behavior and opted to donate the money it would've paid him to charity instead.