Mad Money

Listen up! Cramer calls for bold CEO action

Cramer: Don't just stand there, do something!
VIDEO12:2912:29
Cramer: Don't just stand there, do something!

Jim Cramer wants companies to start taking action. The secret to unlocking major value lies in the actions that are taken right now. Don't just stand there, do something!

"Almost every single company with a stock that jumped today played a major role in that jump, and very few of those rallies were earnings based," the "Mad Money" host said.

All of the companies that managed to rally were those that were run by management that wasn't afraid to make bold moves and control its own destiny. These managements weren't crying over weak retail sales numbers or worried about the direction of the German 10-year treasury or Fed rates.

Why?

Because they understood that with taking action, they could create instant wealth for shareholders—exactly what shareholders pay them to do.

One example included Pall Corp, the company that makes filters for industries such as aerospace and biotech. Danaher acquired it on Wednesday for $127.20 a share, which was astounding, considering that Pall was at $99 on Monday.

The most brilliant move was when, on top of the acquisition, Danaher decided to split itself into two entities. The first is an industrial company with a specialty in test and measurement, and a science and technology with Pall under its umbrella. Cramer thought this was genius, as it didn't make sense to have all of these businesses under one roof.





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Now what about the flipside?

DuPont's stock was slammed on Wednesday because Nelson Peltz's fund Trian failed in its fight to have representation on DuPont's board of directors.

And while Peltz has made a long-term commitment to DuPont, short-term investors were freaked out and dumped the stock.

The stock had initially spiked to $80 when Peltz was giving DuPont's management a run for its money, but now that CEO Ellen Kullman and her board have defeated him, the stock dropped to less than $70.

"Here's the problem with DuPont's stock: With Peltz unable to effect change, it becomes just another chemical stock, subject to the slings and the arrows of the world's economies," Cramer said.

So, that means it can't break out on its own and be a star. It will be affected by things like a strong dollar, downturns in construction and the agricultural market just like any other stock in the S&P 500.

And while Kullman and her team may be doing a good job at DuPont, let's keep in mind that the stock did not rally on the news that Peltz lost the proxy vote; it dropped more than 6 percent on Wednesday.

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It is clear to Cramer that the world's economies are getting better, and soon many of the companies that are strong will be affected by both geography and currency tailwinds. Cramer warned not to wait! Now is the time for companies to take action.

"To the CEOs who are watching, let me tell you something: it's no sin to think big when trying to create value, not by standing there, but by doing something. So what are you waiting for?" (Tweet This)

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