Investors can be ready for a Trump-induced sell-off, Jim Cramer told his Mad Money viewers Monday, but when it comes, it's time to buy.
Cramer said too many investors seem to think that Trump is the only game in town, that the stock market follows his every move. That's just simply not true.
Sure, any focus on immigration, health care and border tariffs will slow down Trump's business-oriented agenda of tax reform, deregulation and repatriation, but that doesn't mean Trump is the only bull on Wall Street.
Trump can do a lot for deregulation all by himself, Cramer noted, and that's already evident in many of his appointments thus far. The banks are the obvious winners, but the effects also extend to energy. Trump is aggressively pursuing oil and gas pipelines, something that will be a boon for that industry.
But even beyond deregulation, Cramer said, companies are doing fine all by themselves. Witness the earnings of Apple (AAPL) and Facebook (FB) , for two examples of companies in control of their own destiny.
So should investors keep an eye on Trump? Cramer said of course they should. But they should also be ready to buy if and when that market correction comes, as there are a lot of great stocks still out there to buy.
Executive Decision: Hasbro
For his "Executive Decision" segment, Cramer spoke with Brian Goldner, chairman, president and CEO of toymaker Hasbro (HAS) , which just posted a monster 25-cents-a-share earnings beat with an 11% rise in revenue year-over-year.
Goldner said that Hasbro is sticking to its brand blueprint, building great stories around all of its brands based on the insights from consumers around the globe. He said that Hasbro is constantly listening on social channels for what customers want and is working hard to fulfill those desires.
Goldner also noted that Hasbro no longer looks at toys and games as gender specific. He said there are many Hasbro brands, like Nerf, Play-Doh and Transformers, that are gender inclusive.
When asked about his company's strong cash position, Goldner said the first priority is investing in the businesses for the long term, but Hasbro also has purchased $151 million of its own stock in the past year and remains committed to its dividend.
Goldner was very optimistic on Hasbro's upcoming movie schedule, which includes a Transformers movie and a My Little Pony movie later this year. He said Hasbro is building immersive entertainment around all of its brands, all around the world.
Don't You Just Love A Turnaround Story?
Cramer said he loves a great turnaround story, and not just in football as we saw in Sunday night's Super Bowl.
He said the stock of chipmaker Advanced Micro Devices (AMD) was trading at just $2.87 in 2015, but rallied 295% in 2016 and is still on fire this year.
For years, AMD has lagged rivals Intel (INTC) and Nvidia (NVDA) and was woefully linked to the decline in personal computer sales. But thanks to strong management, the company was able to pivot away from PCs and into red hot markets like data centers and virtual reality and is even giving Nvidia a run for its money in the gaming space.
AMD went from double-digit sales declines in 2015 to double-digit sales gains now. And after posting 15.4% revenue growth last quarter with expanding gross margins, Cramer said the stock is not done going higher.
Given the spectacular run shares have seen lately, however, Cramer recommended waiting for a pullback before pulling the trigger on AMD.
Don't get distracted by airport protests, Cramer told viewers, the airlines are still in great shape and Alaska Air (ALK) in particular is one of the hottest stocks in the whole market.
For years, Cramer avoided recommending any airline, as price competition made the group practically uninvestable.
But shares of Alaska Air are up $22 since the election, thanks in part to its $4 billion acquisition of Virgin America. The deal should save the combined company $255 million and give it the scale it needs to compete with the four major airlines.
Cramer said even without the Virgin deal, he was a fan of Alaska, along with Southwest Airlines (LUV) . Alaska has no international exposure, friendly labor relations and is a solid operator.
Shares trade at 12.2 times earnings, a premium to United Continental (UAL) at 10.9 times earnings, but also a slight discount to Southwest at 13.7 times earnings. Still worth buying.
Alaska Air will report earnings later this week and Cramer warned that shares are priced for perfection. He recommended buying a little bit ahead of the quarter, but then waiting for a pullback before buying more.
In his "No-Huddle Offense" segment, Cramer said the pains of retail are being felt far and wide, with Estee Lauder (EL) just the latest company to cite weakness at department stores as stunting its growth. On the company's conference call, Estee Lauder commented several times that stores like Macy's (M) just aren't where cosmetics are being bought these days.
That sentiment has far-reaching implications for companies like PVH (PVH) , Newell Brands (NWL) , Kohl's (KSS) and Fossil (FOSL) , Cramer said, as only Hasbro as figured out how to win in this challenging environment.
Cramer said the weakness also lends credence to rumors that Macy's may sell itself to someone willing to unlock the value of its real-estate holdings, something that was suggested by hedge funds two years ago when shares of Macy's traded at roughly twice where they trade today.
Meanwhile, back on TheStreet.com: Cramer looks at what deregulation prospects mean for oil and gas companies and how investors can benefit from Trump's desire for energy independence. Check out Cramer's strategies with a free subscription to Real Money.
Cramer and the AAP Team are telling their investment club members what they should do about Newell Brands in light of Monday's selloff and what the slide means for Magellan Midstream Partners (MMP) . Get in on it with a free subscription to Action Alerts PLUS.
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