Mad Money

Cramer's game plan: Stop the hysteria and use weakness to buy

Key Points
  • "Mad Money" host Jim Cramer applauds the market's resilience before diving into his game plan for the week ahead.
  • Cramer reminds investors to be wary of market pessimists who say the sky is falling the moment they hear negative news.
Stop the hysteria and use weakness to buy

This week reminded CNBC's Jim Cramer that the stock market often acts more reasonably than investors might expect.

"If you sold stocks when everyone was panicking on Monday, you made a big mistake. The fears turned out to be overblown," the "Mad Money" host said on Friday. "I'm proud of the fact that I predicted this and I told you ... please don't freak out ahead of time."

President Donald Trump's tariffs on steel and aluminum imports kept a lid on stocks for most of the week as market-watchers parsed what they would mean for U.S. allies and the economy.

But as the policy loosened, with Trump announcing potential exceptions for Canada, Mexico, and other countries, stocks started to climb again.

Things only got better when Friday's employment report from the Labor Department showed strong job growth without inflation, giving the major averages another boost.

"So many commentators have a tendency to get hysterical whenever something scares them, even a little," Cramer said. "Despite the endlessly negative news coverage, the reality is that good things can happen, too, and when they do, we get terrific days like today."

With that, Cramer turned to his weekly game plan:

Monday: Equifax analyst meeting

Speaking of resilience, the first event Cramer wanted investors to watch was an analyst meeting at Equifax, the credit reporting agency that underwent a massive data breach in 2017.

After the cyberattack, which jeopardized millions of people's confidential data, it seemed like investors had permanently discredited Equifax, sending the $142 stock down to $91 a share.

"But it turns out people have short memories," Cramer said. "The stock was at $142 before the data breach ... and I wouldn't be surprised if it can get back all the way to where it was — from $125, where it is right now — if the company talks about a steady business."

Tuesday: Dick's Sporting Goods, HD Supply

Dick's Sporting Goods: An earnings report from the sports retailer could give investors insight into more than just the company's sales, Cramer said.

The "Mad Money" host hoped Dick's would share how products from major suppliers like Nike, Under Armour and the struggling Newell are selling, as well as how its recent ban on assault rifles is affecting business.

HD Supply: Industrial distributor HD Supply's earnings report will also offer a glimpse into tens of thousands of businesses, Cramer said.

"We know housing is slowing. We talked yesterday about autos peaking. But how about the day-to-day businesses that make up the backbone of our economy?" he said. "I have found HD to give you a fantastic read."

Wednesday: Signet Jewelers, Williams-Sonoma

Signet: The troubled parent company of Zales, Kay and Jared, embroiled in investigations tied to in-store credit practices and alleged employee harassment, reports earnings on Wednesday.

"They've brought in a new management team to clean up the place. So far we haven't seen even the barest glimmer of a financial turn," Cramer said. "Accessories are selling well in America, though."

Williams-Sonoma: Cramer will also have his eye on the earnings report from this home furnishings retailer, once one of the fastest growing retail plays around.

"I wonder if Williams-Sonoma will break out when it reports Wednesday night," he said. "Wouldn't shock me. Housewares have been selling incredibly strong at all the companies that I follow."

Thursday: Dollar General, Adobe, Ulta Beauty, Broadcom

Dollar General: Cramer hoped Dollar General would be able to differentiate itself from rival Dollar Tree with its Thursday earnings report.

"I actually have more conviction in Dollar General ... and the stock has come down a lot," he said. "If its stock comes down before Thursday, we've got to take another look."

Adobe: Calling it "one of the most enticing companies on earth," Cramer expected Adobe to deliver a strong quarter on Thursday thanks to its central role in e-commerce.

Ulta: After a number of very good quarters, Ulta's last few earnings reports seemingly haven't been enough to appease investors, Cramer said.

"Many worry that the Amazon 'Death Star' is now hurting Ulta. Even if Amazon doesn't do any damage, though, some people will assume it's inevitable," he said. "It's an excuse to dump the stock, and maybe next quarter they will. So be careful."

Broadcom: Cramer expected even better results than the ones Broadcom pre-announced for this quarter. But the company has been relentlessly pursuing a takeover of Qualcomm, which he thought could put a lid on Broadcom's stock.

"I'd like to think Broadcom's shareholders win either way," Cramer said. "Still, the rest of the semis are furiously rallying and I'm sure getting tired of this Broadcom-Qualcomm clash of titans when I see all of the other semis do so well. I just wish they'd get this thing over with, frankly."

Friday: Tiffany & Co, United Technologies analyst meeting

Tiffany: Jewelry play Tiffany reports earnings on Friday. Thanks to benefits from a weak U.S. dollar and strong sales at its Manhattan flagship store, Cramer expected a good quarter.

"Tiffany seems tempting, especially because it's still down a tad for the year," he said.

United Technologies: Cramer predicted an analyst meeting at United Technologies would show strength across all of the massive industrial's business lines and shed light on whether a break-up could be in the works.

"Activists are circling, begging for a break-up," he said. "I think CEO Greg Hayes will be forthright about whether he, too, believes a break-up would be a good way to unlock shareholder value."

Final thoughts

"Here's the bottom line: let's finally stop indulging the chicken little people," Cramer concluded. "Just follow the fundamentals and use any weakness in these high-quality stocks as buying opportunities because you believe in their long-term prospects. Please don't let all the big-picture doomsayers freak you out. Remember this: it's been a mistake to panic nearly every time."

WATCH: Cramer's weekly game plan of retail earnings and more

Cramer's game plan: Stop the hysteria and use weakness to buy

Disclosure: Cramer's charitable trust owns shares of Broadcom.

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