This Pharma Move Is for Real

The drug rally now seems undeniable. The consumer may be tapped out and Europe might be tapped out, so the year-over-year comparisons -- at least to those who are buying -- at last favor the buyers of Abbott (ABT - commentary - Cramer's Take) and Schering-Plough (SGP - commentary - Cramer's Take).

Now, that's the mind-set right now. I still believe that when numbers report, it would be better to own Cabot Oil and Gas (COG - commentary - Cramer's Take) to Merck (MRK - commentary - Cramer's Take), but I respect the rally in the pharmaceutical index (DRG) and am not willing to sell my Abbott into it.

This rotation out of winners into losers has been so swift that I believe some of the newfound losers are already cheap enough to buy. But not if you don't have a biotech or a drug stock on hand that you might have bought earlier.

My faves: Gilead (GILD - commentary - Cramer's Take), Abbott and Schering-Plough are all, I believe, going to be able to have numbers raised more than most companies I follow, not as much as an El Paso (EP - commentary - Cramer's Take) or a Halliburton (HAL - commentary - Cramer's Take) but enough to make it so people will say, "I am glad I bought that when I saw the consumer slowdown worldwide."

It makes sense enough to buy one, for certain.

By the way, if you think the grain complex is done going up, you can get behind the Pepsi (PEP - commentary - Cramer's Take)/Coke (KO - commentary - Cramer's Take) trade. I like the drugs more.

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At the time of publication, Cramer was long Abbott Laboratories, Cabot Oil and Gas, El Paso and Schering-Plough.

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