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Turnaround: Only a Quarter Away for These Stocks?

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A lot can change in a quarter. A lot.

"Andy Grove, the man who helped build Intel into one of the greatest technology companies ever, famously wrote in Only the Paranoid survive, that the quarter is a perfectly good unit with which to judge a company's performance," explained Jim Cramer on Monday's broadcast.

In other words, if a company's management is nimble and forward thinking, they can quickly adjust to a rapidly changing business environment and create value in a single quarter.

In such as circumstance a company can easily beat expectations.

Cramer thinks that's an investible thesis – and one which is playing out in the market right now in the case of Dollar General.

"Last quarter gross margin pressure hurt this very aggressive grower," Cramer explained. As a result shares slipped.

However, the company appears to have adjusted and changed their fortunes in a single quarter.

"In the latest earnings report released Monday March 25th there were no traces of gross margin compression. Instead results showed terrific growth and excellent same store sales," Cramer said

Had you believed in the management team and bought Dollar General three months ago – you'd have gains of about 15%.

As far as I'm concerned, "Dollar General is no longer on the must sell list. It is now on the must buy list - on a pullback," Cramer said.

Looking forward, Cramer thinks investors can extrapolate an important idea from Dollar General – that is, the thesis could easily play out again – it's just a question of where.

Chris Gould | Getty Images

Cramer's immediate thought is – Lululemon.

In the past month shares of Lululemon are down about 7% with the stock coming under significant pressure after Lululemon said it was pulling many of its stretchy pants off store shelves because it had discovered they were too easy to see through.

"I am wondering whether Christine Day, the CEO of LuluLemon Athletica might have an ability to get it right over the next three months," Cramer pondered.

"I know I have been harsh about the execution risk here, but we also have to recognize that Day took the extraordinary step of declaring a recall where, perhaps, no recall really needed to occur. The company's integrity shot up because of this incident and I bet LuluLemon doesn't skip a beat."

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Cramer also think Oracle is a solid candidate for the turnaround thesis. In the past week since Oracle's revenue miss, shares have slipped more than 10%

"Every single time the company has had a disappointment like this it has managed to solve the problems and trend higher over time. Every single instance," said Cramer. "Of course, the cloud represents a long-term challenge to Oracle and I know Oracle's an expensive company to work with but the record is clear that Larry Ellison has been able to turn things on a dime, or at least on a quarter." (pun intended.)

The bottom line - "I would not count this company out," Cramer said.

* On March 25, 2013 Jim Cramer's charitable trust owned shares of Oracle

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