Cramer’s Mad Money Recap 5/31: Amazon, Meta, Coca-Cola

Some stocks have fallen so far, they’ve got nowhere else to go but up, Jim Cramer told his Mad Money viewers Tuesday. Even with seemingly everything going wrong, from interest rates and inflation to soaring gas prices, stocks still managed a strong showing last week and rallied off their lows again Monday. Why? Because eventually, stocks become too cheap to ignore.

Just look at stocks like Amazon  (AMZN) – Get, Inc. Report, which has fallen 28% from its highs so far this year. Shares of Amazon still trade for a lofty 45 times earnings, but the company could easily bite the bullet, slash spending, and boost those earnings to make its shares incredibly attractive.

Then there’s Meta Platforms  (FB) – Get Meta Platforms Inc. Class A Report, the social media giant that trades at multiples more akin to Coca-Cola Co.  (KO) – Get Coca-Cola Company Report and Campbell Soup  (CPB) – Get Campbell Soup Company Report than a high-growth tech powerhouse. Investors are totally ignoring the potential of Instagram and the metaverse.

Finally, there’s Alphabet  (GOOGL) – Get Alphabet Inc. Class A Report. Google is still the best place to advertise, and in times of recession, it’s often the only place businesses advertise. That kind of staying power makes Google’s current share price dramatically undervalued.

It simply doesn’t make sense to sell great stocks like these, Cramer concluded, especially when there’s nowhere left for them to go but up.

Executive Decision:

In his first “Executive Decision” segment, Cramer once again spoke with Marc Benioff, co-CEO of  (CRM) – Get Salesforce, Inc. Report, after the company reported another strong quarter that sent shares up 6.7% after the close.

Benioff explained that Salesforce saw 24% revenue growth in the quarter and the pipeline remains strong for the rest of the year. His company has $42 billion of signed contracts that have not yet been delivered.

Among the customer highlights for the quarter were Formula One racing, and State Farm insurance, which now uses the Salesforce Customer 360 platform for field service operations.

With rising interest rates and inflation, disrupted supply chains and falling stock prices, companies are turning to Salesforce more than ever to connect with customers and streamline their operations, Benioff said.

Off the Charts

In the “Off The Charts” segment, Cramer checked in with colleague Larry Williams to see where the markets are likely headed next.

The last time Cramer checked in with Williams, he expressed optimism for stocks, even amidst seven weeks of declines. That contrarian call preceded last week’s strong rally.

Now, Williams continues to be bullish, noting that Friday’s rally saw 95% of the market participating, which is a very positive sign.

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Williams also noted a 12-year cycle in the stock market, one that saw bottoms in 1963 and again in 1975, followed by strong rallies. The same pattern occurred again in 1986 and 1998, and it appeared last in 2010, making 2022 next on the list for a strong rally going into the end of the year.

Cramer said he has no explanation for why these patterns appear in the market, but one thing he does know is never to bet against Larry Williams.

Executive Decision: HP

For his second “Executive Decision” segment, Cramer also spoke with Enrique Lores, president and CEO of HP  (HPQ) – Get HP Inc. Report, the PC, printer and peripheral maker that once again saw strong sales in the quarter.

Lores said that commercial customers grew by 18% in the PC category last quarter and now account for 65% of HP’s total PC sales. The hybrid work environment remains strong, he said, and continues to drive growth for new PCs.

Lores also commented on HP’s recent acquisition of Poly, makers of headsets and video conferencing technology. He said there is still a lot of innovation to be seen in the conferencing space, especially now that hybrid working is becoming the norm. 

Lastly, Lores said he’s proud that Warren Buffett has become a shareholder of HP. While he wouldn’t share many details of his conversations with the legendary investor, Lores did note that Buffett is a customer and uses an HP laptop.

Lightning Round

In the Lightning Round, Cramer was bullish on Pfizer PFE, Bausch Health  (BHC) – Get Bausch Health Companies Inc. Report and Pioneer Natural Resources  (PXD) – Get Pioneer Natural Resources Company Report.

Cramer was bearish on Novavax  (NVAX) – Get Novavax, Inc. Report, Century Aluminum  (CENX) – Get Century Aluminum Company Report, Roblox  (RBLX) – Get Roblox Corp. Class A Report and Li-Cycle Holdings  (LICY) .

China Stocks? That’s a ‘No’

In his “No Huddle Offense” segment, Cramer urged viewers to stop buying stocks of companies based in China. Investing in China is a bad idea, and most Chinese stocks have been horrendous long-term investments.

China is a communist country, which means the Communist Party, not the market, decides who wins and who loses. Despite appearances to the contrary, Chinese markets are not free and fair exchanges and their companies receive little to no oversight.

The U.S. has the best companies, and the best stocks markets, in the world. The U.S. is where you can make money.

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