History doesn't always have to repeat itself, Jim Cramer told his Mad Money viewers Monday. In fact, sometimes it can even lead you astray.
One of the most dangerous phrases in investing has always been "this time it's different." But Cramer said it's important to note that sometimes things actually CAN be different.
Case in point: When the Nasdaq was hitting record highs in March 2015, most pundits were comparing stocks to the dot-com collapse of 2000. Stocks were at dangerous levels, they proclaimed. The only problem was, they were dead wrong.
In March of 2015, Facebook (FB) , an Action Alerts PLUS holding, was trading at $81 a share. Today it trades at $172. Amazon (AMZN) has soared from $369 to $992 a share, while Netflix (NFLX) has rallied after conquering the international markets. Alphabet (GOOGL) has also nearly doubled, from $555 to $945 a share.
Cramer noted that none of these FANG stocks were expensive back in 2015 and they're not expensive now. He also went on to recommend Nvidia (NVDA) , which crossed a new all-time high today and even Boeing (BA) , which is also consistently undervalued.
So the next time the pundits warn that history will repeat itself, just remember that while that's often the case, it's certainly not always the case.
On Real Money, Cramer has a lot more to say about FANG and the lessons of history. Get his insights with a free trial subscription to Real Money.
Executive Decision: Allergan
For an "Executive Decision" segment, Cramer sat down with Brent Saunders, chairman and CEO of Allergan (AGN) , the drugmaker that last week posted a 10-cents-a-share earnings beat with revenues that rose 8.8%. Allergan is another Action Alerts PLUS holding.
Saunders explained that when Allergan took a 10% stake in Teva Pharmaceuticals (TEVA) last year, they indicated that there were no plans to become long-term holders of the stock. The lock-up period on those shares, which have performed poorly since their purchase, has now expired.
Turning to Allergan's sizable drug pipeline, Saunders noted that their treatment for depression is currently in Phase III testing and could be a game changer for patients. He was also bullish on their two treatments for depression, also in late-stage testing, which will usher in a new class of treatments for that disease.
As for the company's' aesthetic products, Saunders said that of the 30 million patients that consider aesthetic treatments, only three million follow through, leaving a lot of room to grow. He said millennials and men are segments of the market that are very small but are starting to expand.
Finally, when asked about the struggle to combat high drug prices, Saunders said there are techniques to lower prices while still stimulating competition and keeping the incentives to invest in new treatments.
Love Isn't Enough
Can investors really use what they already know and turn it into meaningful investments? The notion is not new, Cramer explained.
Famed investor Peter Lynch, legendary manager of the of the Magellan Fund at Fidelity, even wrote a book about it many decades ago. But according to the "Lynch Test," companies needed to be both beloved and profitable to make good investments -- and that pairing has become very elusive in today's markets.
Take Amazon. There's no questioning that Amazon is beloved by customers and has been slowing disrupting multiple industries for years. But Amazon is also wildly unprofitable, using the capital markets to stay afloat while it builds its unassailable empire.
Then there's Netflix, another company beloved by subscribers, but wildly not profitable.
So what should investors make of Tesla (TSLA) and the company's $1.5 billion bond offering to ramp up production of its much hyped Model 3? Cramer said the cars are certainly loved by those that drive them, but how much the company makes, or doesn't make, is anyone's guess. Will it rise to the level of Amazon and Netflix? Only time will tell, Cramer said.
Executive Decision: Snap-On
In another "Executive Decision" segment, Cramer sat down with Nick Pinchuk, chairman and CEO of Snap-On (SNA) , the auto tools maker with shares that are down 10% so far this year.
Pinchuk explained that while tool storage sales were "tepid" last quarter, the strength in their business far outweigh any negatives. That's why the company today announced a $500 million share repurchase.
Pinchuk said sales in their core repair business are accelerating and the repair market continues to be strong.
When asked why his stock trades with the likes of auto parts stores like Auto Zone (AZO) , Pinchuk explained that they're not in the do-it-yourself market and should not trade in lockstep with those companies.
Cramer continued his recommendation of Snap-On.
Cramer and the AAP team say, "Hold on, we're not selling these oil positions -- yet." Find out what they're telling their investment club members now and get in on the conversation with a free trial subscription to Action Alerts PLUS.
Executive Decision: Sierra Wireless
For his final "Executive Decision" segment, Cramer sat down with Jason Cohenour, president and CEO of Sierra Wireless (SWIR) , the chipmaker that posted a two-cents-a-share earnings beat on an 11.1% rise in revenues when it last reported.
Cohenour explained that Sierra Wireless helps companies connect their devices to the Internet and helps manage those devices in the cloud. His company has quite a few deals for automakers, where only 13% of cars are currently able to connect to the Internet. Cohenour said that number will expand to 100% in the future.
Sierra Wireless also has products for smart power meters to help bolster America's electric grid. Cohenour said there is a lot of work to be done in modernizing our power system.
Altogether, Cohenour said Sierra values the market size of the Internet of things at over $30 billion.
Cramer said he simply doesn't get why shares of Sierra fell after the company posted their results.
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