Deal-making across Wall Street is ramping up, Jim Cramer says

CNBC’s Jim Cramer on Monday said deal-making in the corporate world is starting to heat up, telling investors to expect more action in the coming months.

“You don’t get a wave of deals out of nowhere. You get a ripple, and then ever bigger waves,” he said. “Right now, we’re in the ripple stage. That’s when it’s best to do some buying.”

A wave of deal-making doesn’t start out large, Cramer explained, and added that the market isn’t paying attention to some important deals. He brushed off a recent downgrade of deal-making powerhouse Goldman Sachs, adding that mergers are not just good for banks but for the market as a whole.

The deals happening in July “are a terrific harbinger for the fall,” Cramer said, and he suggested it doesn’t make sense to sell a name like Goldman at the moment, even if it misses when it reports later this week. Some investors seem to agree, Cramer said, noting that the bank’s stock still finished in the green Monday despite the downgrade.

Cramer pointed to a few acquisitions announced this month, including candy maker Ferrero’s acquisition of cereal giant WK Kellogg for $3.1 billion. He also mentioned talk on Wall Street that Kraft Heinz is planning to split up its grocery business from its sauces and spreads business. If a company like Ferrero is willing to pay for cereal, Cramer suggested there might be interest in some of Kraft Heinz’s assets.

He also noted that lab equipment maker Waters announced it’s planning to buy Becton Dickinson‘s spun-off life sciences and diagnostic business. Huntington Bancshares on Monday said it would buy rival bank Veritex, Cramer added, suggesting the move could lead Huntington “to shed its regional status and become much more of a national bank.” He said there might be more of these sorts of deals now that the Trump administration’s Federal Trade Commission is more friendly to M&A action.

“As we head into the bank earnings tomorrow, don’t think about the past with Washington leaning against every deal,” Cramer said. “Think about the future, where it looks like the government’s encouraging deals and is in no mood to get in the way of capitalism.”

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Disclaimer The CNBC Investing Club owns shares of Goldman Sachs.