Too Many Reasons to Sell: Cramer’s ‘Mad Money’ Recap (Monday 10/22/18)

Welcome to the end of October, that time of year when there are a million reasons to sell, but not many reasons to buy.

Jim Cramer told his Mad Money viewers Monday that while investors continue to worry about both the Federal Reserve and China, it’s China that is causing the most concern. So far, China hasn’t budged in its trade stance, and that could have lasting effects for stocks that operate there.

Which stocks are being hammered in this choppy market and which could fall even more?

Perhaps the biggest worry is Rockwell Collins (COL) , which could see its merger plans stifled. Cramer said he’s also very worried about Micron Technologies (MU) , which now trades for just four times earnings. Even Kimberly-Clark (KMB) is seeing a big slowdown in its Chinese business and that weakness could bleed into PVH (PVH) , Starbucks (SBUX) and yes, even Apple (AAPL) .

Investors have been selling everything that has to do with China, Cramer said, and they’re moving their money into FANG, Cramer’s acronym for Facebook (FB) , Amazon (AMZN) , Netflix (NFLX) and Alphabet (GOOGL) . None of these companies has anything to do with China or the Fed, Cramer concluded, which is why they seem like the only game in town at the moment.

Cramer and the AAP team are adding to their position in WestRock (WRK) . Find out what they’re telling their investment club members and get in on the conversation with a free trial subscription to Action Alerts PLUS.

Executive Decision: Hasbro

For his “Executive Decision” segment, Cramer spoke with Brian Goldner, chairman and CEO of toymaker Hasbro (HAS) , which just posted a 30-cents-a-share earnings miss on a 7% decline in revenues as the company continues to digest the bankruptcy of Toys R’ Us.

Goldner said that 2019 will see Hasbro’s return to growth as they move past Toys R’ Us. He noted that inventory levels in the U.S. are down 17% and in Europe they’re off 20%, as retailers continue to operate at very lean levels.

When asked about China, Golder noted that 70% of their products are currently made in China, but that number will be less than 60% in two years. Play-Doh, for example, just resumed production in the U.S.

Hasbro also has exciting tie-ins with some of the most popular video game titles, including Overwatch and Fortnite. Goldner said soon gamers will be able to jump out of the game and play for real with various Hasbro brands.

Cramer said that Hasbro has been working its way through difficult times but still has a terrific outlook, unlike rival Mattel (MAT) , which seems to have real problems.

Over on Real Money, Cramer says we say breakdowns last week in too many groups. Get more of his insights with a free trial subscription to Real Money.

Search Jim Cramer’s “Mad Money” trading recommendations using our exclusive “Mad Money” Stock Screener.

To watch replays of Cramer’s video segments, visit the Mad Money page on CNBC.

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