Want to know what investors think about Donald Trump's plans for the economy? Watch bonds, Jim Cramer told his Mad Money viewers Thursday.
If bond yields are rising, it means investors are moving into stocks, which is great news for the industrials, banks and a host of other sectors.
Trump's meeting today with airline execs was a perfect example of the president's effect on the markets. Even a casual mention of corporate tax reforms was enough to get investors selling bonds and piling into industrial stocks like Cummins (CMI) , 3M (MMM) and Honeywell (HON) .
As for the banks, Cramer said that any talk of deregulation seems to give shares of JPMorgan Chase (JPM) a boost, while a softer tone on a border tax bodes well for ailing retailers like Costco (COST) , an Action Alerts PLUS holding.
That's why Cramer said every investor should keep their eye on the bond market. If yields are rising, then so too will stocks.
Executive Decision: SAP
For his "Executive Decision" segment, Cramer spoke with Steve Singh, president of business networks and applications at SAP (SAP) , the software provider that last posted a 14-cents-a-share earnings beat.
Singh, the former CEO of Concur Technologies, which was acquired by SAP, said that he's enjoying working with a larger company like SAP. He said not only are SAP's users loving the Concur products, but many Concur customers are learning about SAP's other offerings as well.
Singh was also bullish on Fieldglass, another SAP acquisition that offers human capital management services for a company's service-based workforce.
When asked about what's coming next, Singh said the next big trend will be "micro services," where applications like your email client are smart enough to take actions, like booking travel, automatically when it sees you have an appointment out of town.
Some companies are in control of their own destiny, others aren't, Cramer told viewers. That was certainly the case today when shares of Twitter (TWTR) plunged another 12.3% after the company slashed earnings estimates.
Coca-Cola (KO) is another company not in control of its destiny, as the company's main product, soda, just isn't as popular anymore. Compare Coke to rival Pepsico (PEP) , another Action Alerts PLUS name, and it's clear to see that Pepsi is in control, as it has a thriving snack business to drive growth.
Executive Decision: TreeHouse Foods
In his second "Executive Decision" segment, Cramer checked in with Sam Reed, chairman and CEO of TreeHouse Foods (THS) , the private-label food maker that just posted a five-cents-a-share earnings beat with strong guidance for the rest of 2017.
Reed noted that TreeHouse's legacy brands were up 3% in the company's fourth quarter, while the brands they acquired from ConAgra Brand (CAG) swung from a deficit to a gain.
When asked about the acquisition of those brands, Reed explained that ConAgra had attempted to combine both branded and private-label into a single business unit, a combination that just didn't work given the different natures of the two. TreeHouse has a single focus on private label, he said, and that's been critical to their success.
Turning to the topic of growth, Reed said that in the U.S., private-label penetration is only at 18%, while in other countries and in some U.S. markets, it's double that number. That leaves a lot of room for growth, he added.
Finally, Reed said that their market is changing, as more and more companies target millennials, who value healthy and organic items as well as things they can prepare themselves.
Cramer said shares of TreeHouse still have a lot of room to grow.
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. The first portfolio included Apple (AAPL) , United Rentals (URI) , American Express (AXP) , International Paper (IP) and IDEXX Laboratories (IDXX) .
Cramer blessed this portfolio as properly diversified.
Cramer said this portfolio was "perfection."
Cramer said this portfolio was also "well played."
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