Cramer's 'Mad Money' Recap: Testing China's Metal

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Inco, Inco All Day

Jim Cramer is issuing a "Mao back" (a Chinese version of a 'mon back*) on nickel producer, Inco (N Quote), he said Tuesday on his "Mad Money" TV show.

A recent Wall Street Journal article talking about how a major Chinese nickel processor is struggling to meet demand for nickel makes Cramer want to own Inco, the world's largest producer of nickel.

Cramer said Inco just opened a new mine and that alone should be worth an additional $6 to its stock price. Inco shares ended the regular trading session Tuesday down $1.02 to $43.53.

"A gift," said Cramer. Cramer sees Inco's stock breaking $50 in the "not too distant future."

A caller asked if China Medical Technologies (CMED Quote) might be a good way to play the growth in hospitals in China.

Cramer said that CMED was a speculative play and that he was uncomfortable with it because of Chinese medical companies' tendencies to make unsubstantiated claims.

The best way to play the growth in Chinese medicine, he said, is to buy U.S. medical technology companies that do business in China such as General Electric (GE Quote).

Another caller asked about Chinese Internet plays. Cramer said Google (GOOG Quote) and Yahoo!(YHOO Quote) "own the Net, and they will own the Net in China, too."

Three of a Kind

Cramer is bullish on three energy stocks as possible takeover plays: Energy Partners (EPL Quote), Newfield Exploration (NFX Quote) and PetroQuest Energy (PQUE Quote).

He's bullish because on Monday Norsk Hydro (NHY Quote) offered to pay an "enormous" amount for Spinnaker Exploration (SKE Quote), which is virtually "interchangeable" with these three companies.

Furthermore, "none of them have run up as much as they should in response to this unbelievable Norsk-Hydro-for-Spinnaker bid," said Cramer.

Cramer said Norsk-Hydro paid the equivalent of $42 per barrel of proved reserves for Spinnaker. Energy Partners is valued at just $16 per barrel of proved reserves, Newfield at $20.54 and PetroQuest at $23.10, Cramer added.