- Jim Cramer dove into one buy that could be heating up for the summer.
- He also looked at Universal Display to find out what is driving its massive 2017 run.
- In his lightning round, he stuck with a flat-lining drug stock.
While Jim Cramer knows investors do not care about his political views, as a possibly hotter-than-ever summer approaches, one stock could be heating up with it: Pool Corporation.
"Unusually extreme weather has consequences for the stock market," the "Mad Money" host said. "When we get an especially cold winter, we use more energy heating our homes and the natural gas stocks rally. When we have a particularly mild winter, people buy less cold weather apparel and companies like VF Corp, which makes North Face, tend to suffer."
And when the summer gets too hot, people might dive for the pool, which brings in Pool Corp, the biggest wholesale distributor of swimming pool products and other backyard supplies.
The company's stock has been climbing over the years, and while it has flat-lined lately, Cramer believes that a warmer-than-usual summer paired with the end of the California drought could mean better business for Pool Corp going forward.
While the stock is relatively pricey, selling at 25 times next year's earnings estimates, Cramer argued that the consistent growth story will benefit from "one of the most implacable secular trends out there: global warming."
"I like companies that prosper thanks to big-picture themes, and that's exactly what Pool Corp is doing," Cramer said. "Plus, shorter-term, the end of the drought in California coupled with the beginning of what could be a very long, hot summer make this stock very attractive right here, right now."
On a day of a relatively wide selloff, with about 30 percent of Nasdaq stocks seeing a 10 percent downturn, Cramer finds it counter-intuitive that people run from the "sale" than to it.
"Notice, I didn't say, 'running from the fire' versus 'to the fire.' Because in the end, this is about solid merchandise being marked down by multiple sellers for multiple reasons," the "Mad Money" host said.
So, in light of what looks like a larger rotation out of the high-growth names and into the bank, retail, oil and health care stocks, Cramer gave investors three reasons for the market's decline.
"No matter what I have to say about this change, it really doesn't matter," he said. "The market has spoken."
Cramer recalled what famed NFL head coach Bill Parcells, also known as The Big Tuna, used to say: "You are what your record says you are." In GE's case, Immelt's record showed he was unfit to remain at the helm, Cramer said.
When it comes to U.S. consumers, Mark Butler, the chairman, president and CEO of Ollie's Bargain Outlet, said nothing reels in buyers like a good deal.
"That is retailing: the right item at the right time, but for Ollie's, it's at the right price. And that's what turns on the American consumer," the CEO told Cramer on Monday. "Give them a bargain. It will never go out of style."
Ollie's, a chain of 247 discount stores that went public two years ago, focuses on buying excess or out-of-date products from companies at deep discounts and selling those products to shoppers.
And despite the widespread pain felt by traditional brick-and-mortar retailers nationwide, Butler told Cramer that he sees plenty of reasons to be bullish on the company's growth pattern.
Finally, Cramer turned to Universal Display to figure out what is going on with its stock, which has seen a massive 108 percent run over the course of 2017.
The company develops components for smartphones, virtual reality platforms, wearable devices and TVs that help produce a bright, crystal-clear display, and then licenses those technologies out to display and lightning panel manufacturers.
"So Universal Display has something proprietary," Cramer said. "On top of that, it goes into an increasingly red-hot product. OLED's consume less power than LCDs, and in addition to looking superior in just about every way, they're also more cost effective because making OLED screens requires fewer manufacturing steps."
And as OLEDs are increasingly chosen over LEDs for normal lighting uses, Universal Display's stock has enjoyed the benefits of being a streamlined OLED play.
In addition, the company regularly serves high-profile clients like Samsung and Apple, which have given it a fair amount of buzz on the Street.
"The fact is, Universal Display is one of the few public pure-plays on OLEDs, the industry has gigantic momentum, and as we get closer to the new iPhone launch, I bet this stock will roar. I think this is just the beginning, as we're starting to see OLEDs being used for all sorts of electronic devices, and since Universal Display isn't just a commodity play — you need to license their technology to make the best screens — the stock could have more room to run," Cramer said, adding that investors should buy it slowly on the way down if the current selloff holds.
In Cramer's lightning round, he rattled off his take on some caller favorite stocks:
Cara Therapeutics: "I believe in Cara. We had them on. Unfortunately, the stock has done absolutely nothing, but I do believe in them and I think the drug is a good one – the anti-itch part especially. So I'm sticking with it."
MGM Growth Properties: "I like that, too. I happen to be a big fan of what [Chairman of the Board] Jim Murren has put together. I like it very much."
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