Cramer's 'Mad Money' Recap: Unhealthy Dose of Skepticism (Update 1)
Cramer explained that skeptics can keep investors out of great stocks and they never apologize when they get it wrong. Such was the case with Sherwin-Williams (SHW) , a company that preannounced huge upside after Monday's trading. The skeptics take? Must have been due to warmer weather.
But Cramer noted that anyone who listened to Sherwin's conference call would have known that the real driver was interior paint, not exterior paint. The company's huge sales were from rising demand, not from a weather anomaly. So what happened to all of the skeptics? They missed out on a huge rally to a new 52-week high for Sherwin-Williams.
Terrific retail sales all over have been attributed to a warm winter, said Cramer, but nothing could be farther from the truth, as natural demand is what's keeping sales at VF Corp (VFC) and PVH Corp (PVH) humming along.
Demand can be seen in stocks like Alcoa (AA) , which saw aluminum demand for cars and aerospace rise, and with Owen-Illinois (OI) , which is profiting from not only rising demand but also falling costs.
"Business is better," Cramer concluded, no matter what the skeptics in the markets may be telling you.
Executive DecisionIn the "Executive Decision" segment, Cramer spoke with Kelcy Warren, chairman and CEO of Energy Transfer Partners (ETP) , an oil and gas pipeline master limited partnership with a 7.7% dividend yield. Energy Transfer Partners is currently a stock that Cramer owns for his charitable trust, Action Alerts PLUS.
Kelcy was very candid in admitting that being a pipeline company with 90% exposure to natural gas is not a great place to be at the moment with gas prices falling to historic lows. However, he noted, things won't be getting any worse for the company and Energy Transfer is committed to moving into transporting heavier liquid products that will offer greater returns.
Kelcy went on further to note that investors buy into Energy Transfer for both the yield and for growth, and the company has let them down in the growth department as of late. He said that will change as the company integrates its recent acquisitions and diversifies the products it transports.
When asked whether the transition will require additional equity offerings, Kelcy said that it likely would. He also said that more equity isn't necessarily a bad thing, as Energy Transfer has a track record of investing capital wisely to produce great returns for unit holders.