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Cramer Remix: Don’t let the action in UnitedHealth fool you

  • "Mad Money" host Jim Cramer sends a warning to investors about the unjust action in the stock of one insurance supplier.
  • Cramer also checks in with the CEO of Prologis, a warehouse REIT positioned to benefit from the spread of e-commerce.
  • In the lightning round, Cramer asserts his confidence in the stock of a huge mail provider.

The GOP's failure to pass health care reform has shaken the market, so much so that Jim Cramer made the case for cordoning off Wall Street from Main Street.

While Wall Street obsesses over the FANG stocks, Cramer's acronym for Facebook, Amazon, Netflix and Google, now Alphabet, for being the few plays immune to Washington's turmoil, strong earnings reports are overlooked or even met with disdain.

"That's why I want to sing the praises of a bunch of companies that have reported this earnings season, companies that would be getting a lot more attention and love right now if Washington wasn't making us feel so pessimistic, so cynical," the "Mad Money" host said.

One such company was UnitedHealth. The largest health care provider in the country, UnitedHealth reported its quarterly earnings on Tuesday, topping the Street's estimates.

Cramer's go-to UnitedHealth analyst, Mizuho Securities' Sheryl Skolnik, called it "an outstanding report," but the stock closed up only 0.2 percent, a mere 50 cents.

"Don't let its measly 50-cent gain fool you," Cramer warned. "United Health reported a great quarter. Its stock's a buy."

Off the Charts: The Forgotten Ones

A trader works on the floor of the New York Stock Exchange.
Adam Jeffery | CNBC
A trader works on the floor of the New York Stock Exchange.

The technology sector may be seen by the stock market as the hotbed of growth and the rally's main driver, but Cramer wanted to put its performance into context.

"It's not like tech is vaulting into the stratosphere while everything else does nothing," Cramer said. "What we have here is a broad-based rally that's taking up all sorts of stocks, proving once again that diversification is the only free lunch in this business."

In the last six months, the tech stocks in the S&P 500 rallied 15 percent on average, but the health care stocks rose over 13 percent, with industrials, materials and financials up 8 percent.

So Cramer used the charts of technician Bob Moreno, publisher of RightViewTrading.com and Cramer's colleague at RealMoney.com, to highlight some of the overlooked sectors' top names.

Netflix: 3 Reasons Why

The Netflix app on an Apple iPad mini tablet computer.
Daniel Acker | Bloomberg | Getty Images
The Netflix app on an Apple iPad mini tablet computer.

In light of Netflix's strong earnings report, Cramer knows CEO Reed Hastings understands three things: content can be king, people love bargains, and bigwig money managers will invest in internet stocks with promise.

"Netflix is, to the naked eye, a two-pronged success. If your company can produce local content that people love worldwide and you only charge them $8 or €8 a month, you'll land and expand. You'll grow and grow and grow," the "Mad Money" host said.

But the third element, the willingness of Wall Street financiers to catch and pay for the next hot internet-related trend, was what really drove Hastings' success so far, Cramer said.

A Windy Road for Straight Path Communications

Cramer also analyzed the action in Straight Path Communications, using the stock's moves to make the case that markets are not, as some economic theories say, perfectly efficient.

Verizon recently announced it would buy Straight Path, which owns bandwidth licenses for 5G networks, for $184 a share after a bidding war with AT&T that sent the stock price soaring from $36, where it stood before the bids began.

"The action in Straight Path Communications has been very exciting, but I wouldn't call it efficient," Cramer said. "The reason you can make money in individual stocks — as long as you do the homework — is that markets are rarely super efficient, the conventional wisdom is often wrong, and there are often huge opportunities there for the taking if you know where to look. Straight Path had a lot going against it, sure, absolutely, but at the end of the day they owned some insanely valuable spectrum assets that ultimately made AT&T and Verizon willing to pay through the nose to buy the whole company. That's what really mattered."

Prologis CEO: Broader than E-Commerce

Finally, Cramer spoke with Hamid Moghadam, the CEO of warehouses real estate investment trust Prologis, to check in on the REIT space and see how the industry is building on the rise of e-commerce.

"It's really broader than e-commerce," Moghadam told Cramer on Tuesday. "I mean, it's all consumption-related and, you know, supply has been very disciplined in the last couple of years and demand has been really strong, so the combination of those two [has] made the best market of my career."

And as data becomes increasingly important to technology companies working on the Internet of Things and artificial intelligence, Moghadam said his company is well-positioned to take advantage of the information boom.

"I think in 10 years we're going to think about our businesses, not just the real estate business, but also a very significant data business, and I think that data is going to help our customers, it's going to help our own decision-making, and who knows? If we're really successful at this, it could be a separate business that could be valued separately by the market," the CEO said. "It's way too early to get that far ahead of our speed, but I'm really excited about those opportunities."

Lightning Round: Don't Give Up on UPS

In Cramer's lightning round, he flew through his take on some callers' favorite stocks, including:

United Parcel Service: "UPS is getting its act together and they are levered to e-commerce. No, you don't want to sell. We're not going with that. We like UPS."

McKesson Corporation: "I have to tell you, long term buy. The words 'long term' were crucial because short term, I don't like the expectations there."

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