There’s a big difference between blind speculation and informed speculation, Jim Cramer told his Mad Money viewers Thursday. Therefore, it is time to reduce the seven deadly stock sins that Cramer said he sees on Twitter (TWTR) – Get report every day.
The first deadly sin is cheerleading. Cramer said investors think they are helping their favorite stocks by promoting them, but in reality, the charity only warns the short sellers on an opportunity.
The second deadly sin is not knowing what a business is doing. Cramer said every investor should have at least three reasons why they keep a stock so they know when to sell, because those reasons disappear.
Deadly sin no. 3 on Twitter: buying non-Tesla electric car shares (TSLA) – Get report. Cramer said stop looking for the next Tesla, just own Tesla, the only EV maker that actually sells cars.
Sinten nr. 4 and 5 buy low dollar stocks and buy penny stocks. No stock falls below $ 10 a share because things are going well, Cramer said, and penny stocks are the most risky investments around.
Sin no. 6 takes no profit. Cramer reminds viewers that you have no profit before you sell. Call the register on your original investment and play with the money from the house, or lock out your position and enjoy your profits.
Finally, the latest deadly sin that Cramer sees on Twitter accuses him of promoting a share. “I will not recommend stock just because you ask me to,” Cramer said. Being a smart investor means doing your homework, creating your own opinions and no sin no. 2 to commit.
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Administrative decision: PayPal
In his first segment “Executive Decision”, Cramer talks to Dan Schulman, President and CEO of PayPal (PYPL) – Get report, the powerhouse online payments that just posted revenue that included 50% revenue growth and helped boost stocks by 78% for the year.
Schulman said the pandemic has led to an increase in payments for digital first, making PayPal’s tool more important than ever. He said his company has defined itself from just a “buy now” button into a leading platform of tools for our new digital economy. If you shop online and consume digital services, you need PayPal, he explained.
But PayPal is about much more than just online payments, Schulman added. In a recent survey, nearly 45% of consumers said they no longer want to deal with cash, touch a keyboard or sign their name to make a purchase. These consumers want contactless, mobile payments.
PayPal is also at the forefront in the fight for racial justice, Schulman said. It’s not enough to just be about maximizing profits, he said. PayPal thinks about the communities it serves and cares about the well-being of its employees and those communities. He said companies need to do more than just condemn racism, they need to help make the systemic changes needed to solve the problem.
Executive decision: Azek
For his second segment “Executive Decision”, Cramer also spoke with Jesse Singh, President and CEO of Azek (AZEK) , the building materials company with shares that rose 4.5% on Thursday after reporting its initial revenue as a public company.
Singh said Azek saw strong demand across the board, although many contractors were not allowed to work in some parts of the country. The pandemic has made the home more important than ever, he said, and tackling the exterior with high-quality materials that last is a big bonus for the long term.
Azek has been building its brands for more than 20 years, Singh said, and the company’s unique technologies have been translated into many loyal customers. Despite all their successes, 80% of the tire market is still wood, which remains its primary competitor.
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Executive decision: Five9
For his final “Executive Decision” segment, Cramer checked in Rowan Trollope, CEO of Five9 (FIVN) – Get report, the call center software provider that now trades for $ 10 less than last week, when it reported strong revenue.
Trollope explained that Five9 is in the right place at the right time, and when the pandemic hit, the cloud software providers were the big winners of the work-from-home trend. He said their enterprise market grew by 33% in the quarter as companies moved rapidly to replace legacy systems with new cloud technologies.
Trollope also noted its recent partnership with AT&T (T) – Get report as a great gain. He said the exclusive deal is moving very fast to bring new customers to the Five9 platform.
Beyond AT&T, Trollope said its two biggest deals from its company closed this quarter and Five9 continues to have a very low price level. Customers want digital first technologies and legacy providers to simply not match Five9’s advanced cloud offering like virtual assistants powered by artificial intelligence.
Take a key from Apple and Tesla
Cramer is on a new crusade to help the individual investor. He urges companies with high-dollar stocks to follow in Apple’s footsteps (AAPL) – Get report and Tesla and split their shares to make them more affordable.
Yes, it is true, dividing a stock into smaller pieces provides zero value, Cramer added. But after the often irrational stock market, cheaper stocks are always better. In recent years, companies would often distribute their shares, usually with a lot of fanfare, using the event as a sign of strength. But as larger, institutional investors gained more power, companies instead urged to lower their share prices to levels unreachable to more individuals.
But Cramer said any company with shares above $ 100 should follow the lead of Apple and Tesla and make their shares more affordable. If it really does not make a difference, why not do it? The market will reward you, Cramer said, just as it will reward Apple and Tesla.
Lightning
Here’s what Jim Cramer had to say about some of the stocks that callers offered during the Mad Money Lightning Round Thursday night:
FleetCor Technologies (FLT) – Get report: “I’m worried about their growth. Things look hesitant.”
Opko Health (OPK) – Get report: “This has had a big move and then pulled back. This is a great company.”
Tupperware (TUP) – Get report: “This stock was posted so incorrectly. Take your costs and let the rest run.”
Eventbrite (EB) – Get report: “I would not sell at this point. I would just hold on to it.”
Axcelis Technologies (ACLS) – Get report: “I love this stock.”
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At the time of publication, Cramer’s Action Alerts PLUS held a position in AAPL.
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