There are some days in the market when taking cues from stocks' movements can be detrimental, CNBC's Jim Cramer said Wednesday.
"I see stupid things happening all over the place, so I'm urging you not to jump to any conclusions based on the tape," the "Mad Money" host said. "Remember, the big money managers who control the day-to-day gyrations in stocks get things wrong all the time."
One example was Home Depot. Ahead of the retailer's Tuesday earnings report, its stock opened down $2 as sellers braced themselves for what they expected to be a mediocre quarter.
To their dismay, the home furnishings giant reported a sweeping earnings beat with dramatically higher-than-expected same-store sales growth, a key metric for the retail sector. Same-store comparisons came in at 7.9 percent year over year when analysts were expecting 5.8 percent.
On the post-earnings conference call, Home Depot's management touted strong e-commerce and outperforming categories, as well as customer growth as millennials become homeowners.
As a result, shares of Home Depot popped roughly 2 percent on the news.
"Now, if you were just taking your cue from the action you would've decided that Home Depot had a terrible quarter," Cramer said. "It was right there, at $163, down $2, and a lot of people sold. It's just that the sellers turned out to be wrong, and you really don't want to be wrong in this business — it's too expensive."
The stock of IBM was Cramer's second example. While the technology colossus' latest quarter wasn't stellar, the market seemed to embrace it as the last of the company's bad quarters, sending the stock up from $146 to $162 a share in three days.
But since then, shares of IBM have been clobbered, drifting back down to $147.10 as of Wednesday's close.
The declines were partially fueled by Tuesday's news that billionaire investor Warren Buffett was cutting his firm's stake in IBM by more than 30 percent.
"For starters, we have no idea when Buffett will be done selling, and few investors like to own a stock that he's given up on," Cramer said. "That said, at these levels IBM's stock yields 4 percent, and to me, the stock feels like it's become an emotional juggernaut. I believe in the turn here. I think the stock can go a little lower, but boy, is it getting intriguing."
Finally, Cramer turned to The Walt Disney Company. Shares of the entertainment giant took a hit after the company's earnings report on Nov. 9, which posted year-over-year declines in most of its key businesses.
Disney's stock, which closed up 1 percent on Wednesday at $103.69 a share, was sent down to the $90s after its report, leading some to believe that the quarter was awful, plagued by losses from the hurricanes, cord-cutting and ESPN weakness.
But with the company spending on BAMTech, its baseball streaming franchise, a new Star Wars slated for December and a surge in Shanghai Disney, Cramer said Disney simply offers "too much to like."
Sometimes, the "Mad Money" host finds that the entire market can be wrong, grasping at reasons to justify declines or to trade in tandem with international markets.
"These days, if Germany's market is down 1 percent and Britain's down 1 percent and Japan's down 1 percent, we'll find a reason to sell off, like the Senate insisting on rolling Obamacare repeal into their tax bill," Cramer said.
"But here's the bottom line: do not take your cue from the action," he continued. "In this business, stocks are often wrong. Instead, you need to do your own homework, pick your prices, and then patiently wait for the names you like to pull back for a bad reason, something that happens with alarming frequency."
WATCH: Cramer pinpoints all the 'wrong' stock action in the market
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