Cramer: Trading Thursday’s Retail-Sales Report

“The conventional wisdom’s been smashed to pieces by this market,” Cramer said Wednesday.

The Mad Money host has mentioned these contradictions before, but today his focus was on retail. Both ends of the shopping spectrum, high and low, are working at the same time. While Family Dollar reported strong earnings, indicating that the consumer is trading down, The New York Times ran a story today that said the consumer is buying brand-name items from Kellogg and Kraft Food .


Goldman Sachs threw a similar curve ball when it upgraded TJX Cos. on Tuesday, sandwiching it in between upgrades of Nordstrom on Monday and Coach today. Consumers usually pick discount or luxury, depending on their cash flows, but Goldman’s saying that they both work.

“In my 30-year career of picking stocks,” Cramer said, “it has never all worked at once. We’re either supposed to be shopping at Nordstrom or schlepping to Family Dollar.”

So how do investors play the trend?

Wait for Thursday’s retail sales report. All of these stocks have seen significant moves, Cramer said, so it’s too late to buy now. But when analysts shrug off tomorrow’s numbers – as they so often do, regardless of the actual strength of those sales – investors will have the chance to get in at a discount.

As for the previously mentioned investing dilemma, how both high and low end could succeed at the same time, Cramer again pointed to retail sales. With so many market conventions being left behind, investors might be better served by waiting for the whole sector to dip and then picking their favorite.

“I say don’t waste your time on it,” Cramer said, “as the buy point may be tomorrow.”

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