In other words, it adjusted to what the consumer wanted and is doing substantially better than expected. This was a similar dynamic to what Cramer saw from J.C. Penney, which said on its conference call that categories such as handbags, footwear and Sephora all outperformed.
While it is still a bit early in the trend, Cramer suspects that the reason why investors are suddenly embracing these beaten-down names is because there is a large gap between the stocks of the haves and the have-nots — not necessarily the companies themselves.
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Cramer was also mystified when Whole Foods didn't jump after it reported the last quarter, but that all changed in the past 48 hours.
"The guys at Whole Foods clearly believe that their stock deserves to go higher, and I can't say I disagree with them," Cramer said.
He thinks the stock is a buy at current levels, given the fact that it is only at the levels where he expected it to be after it reported its first good quarter in ages just four weeks ago.
Management at these companies has finally figured out that the old ways of achieving success were not working, and they have finally pivoted their approach.
"Urban Outfitters, J.C. Penney and Whole Foods remind us that nothing is static in this market, and smart changes will be rewarded with higher share prices, just as they should be," Cramer said.