With Ron Johnson now at the helm, Cramer on Monday said he has a “good feeling” about retailer J.C. Penney .
After all, it was Johnson that helped “revolutionize” Target . As merchandise manager, he created brand name hard goods that changed the look and feel of the discount retailer. Steve Jobs would later lure Johnson to Apple , where he would develop Apple’s retail outlets. Needless to say, Johnson has a proven track record of turning retailers around.
On Wednesday, Johnson will take the podium for the first time as J.C. Penney’s CEO. He will outline his vision for turning around the Plano, Texas-based retailer and its 1,000 stores or so. But Cramer doesn’t recommend buying JCP ahead of earnings because there’s already a lot of trigger-happy hedge funds in the stock, who are ready to sell. Retail turnarounds are too tough for a quick trade, he said.
Cramer does recommend buying JCP for the long-term, though, as in holding it for the next 18 months. Despite the fact the turnaround will take a while, Cramer has a lot of confidence in Johnson. He thinks Johnson will win customers and boost sales by cutting prices. It’s also acquiring new brands.
Bottom line: To Cramer, JCP is worth owning for the next 18 months, not the next 18 minutes.
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