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Cramer's 'Mad Money' Recap: Four Spec Names to Play

TheStreet.com Staff

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Speculation may sound "irresponsible, reckless and stupid" to some, but protected speculation is something Jim Cramer endorses, the "Mad Money" host told viewers Friday.

The first risky name Cramer wants people to look into is Landec (LNDC Quote), "a small, $12 stock."

It's in one of the hottest sectors right now -- the seed technology business -- he said. Although seed technology might not sound sexy, this speculative stock could make people some mad money, Cramer said.

High corn prices are encouraging farmers to grow more corn and deliver higher yields from the same fields, he explained. And Landec "is a speculative way to play this trend."

The company has come up with Intellicoat, a technology that keeps water from germinating planted seeds until the soil is warm enough for them to grow healthily, Cramer said. It allows farmers to plant seeds four weeks ahead of the ideal planting date.

"If corn is the next oil, then Landec is equivalent to a pressure pumper [that] gets more corn out of the soil," he said.

Landec's main business is to make food packaging that increases the food product's shelf life, Cramer continued. Although Landec's food packaging business is the company's "main revenue generator," what Cramer really likes is its seed technology business.

On a conservative level, he believes Landec has a 27.5% long-term growth rate. But Cramer warned people to use limit orders and not to buy the stock all at once.

Three Specs Around the Cisco

If market players want a "steady, dependable" play for the telco and cable build out, Cisco (CSCO Quote) is the stock to buy, Cramer told viewers.

At the same time, taking Cisco's "great" quarter as a cue, he believes it's time to get back into the speculative plays in the telco sector. While the little telco companies are "notoriously unreliable," they can be "unbelievable" when business is good, Cramer said.

Optium (OPTM Quote) and Finisar (FNSR Quote) should be the biggest beneficiaries of Cisco's quarter, he said.

Opnext, which will trade under the symbol OPXT after it comes public next week, is another stock Cramer believes is levered to Cisco's performance and people should buy. However, he warned viewers to be "especially careful" and not to pay more than $16 to $17 for Opnext, "unless there's too much enthusiasm."

"If you can get in on the IPO, chances are very good that you'll make money off the initial pop," he said. "That would be the real opportunity."

Cramer warned viewers that these stocks will likely burn out fast. "They are not Cisco, and if you hold them too long they will break your heart," he said.

Cramer advised market players to sell the stocks when they're up, even if they look like they might be going higher. Otherwise, people will be putting themselves "in danger of losing money," he said.

Next Week's Game Plan

Cramer said he doesn't care for the market right now, as gold keeps rising and financials are not doing well. Plus, next week is options expiration week, which always makes things even more dicey, he said.

Therefore, people should take some profits, he said. "If you're tempted to pull the trigger, buy less," about half of what you would normally buy, Cramer advised. And he told people not to be surprised if a stock goes down even after reporting a good quarter.

This week, Prudential (PRU Quote) reported a really good quarter, and Aon (AOC Quote) talked about how good the insurance business was.

But MetLife (MET Quote), which reports next Tuesday, is the big sleeper stock of next week, Cramer said. He advised people to buy it before and after it reports earnings, regardless of whether or not it gets hit, since it's best of breed and has a "tremendous" growth rate.

Cramer warned viewers of the possibility that MetLife's stock might do nothing after the insurer reports, because the market is so awful. But he said people should not panic and should buy more later in the week.

Denny's (DENN Quote) has a high debt situation, which Cramer said he likes because this enables it to refinance at better rates. However, he advised people to wait on buying this stock, even though he likes it.

Wait on Chipotle Mexican Grill (CMG Quote) to report as well and then buy it after next week, Cramer continued.

He said his long-term view on Life Time Fitness (LTM Quote) is still the same, and he believes people should buy it.

Buy Baidu (BIDU Quote) lower after it reports Wednesday, Cramer said. And buy a little Psychiatric Solutions (PSYS Quote) ahead of when it reports Thursday as it should have a nice jump, he said.

Ring the register before Masco (MAS Quote) reports, because its quarter will not be good enough, Cramer said. In addition, take a little KB Home (KBH Quote) off the table before it reports and then go back into it after it reports, Cramer said.

Get in Daktronics (DAKT Quote) ahead of and after it reports.

Lastly, keep an eye on Reliance Steel (RS Quote), Cramer said, adding that he expects some profit-taking in the stock. If people own it, they should consider ringing the register.

Mad Mail

In the "Mad Mail" segment, Cramer told a viewer that MasterCard (MA Quote), under $100, is a gift. The stock closed at $103.60 on Friday.

However, because MasterCard was up 129% last year, he feels people shouldn't be too greedy with it.

When a mailer asked why Cramer likes Procter & Gamble's (PG Quote) CEO A.G. Lafley so much, Cramer said Lafley is a man that "has taken a good company and made it great."

Cramer said Lafley is delivering, and he believes that Procter & Gamble is a nice stock to buy and put away.

Lightning Round

Cramer was bullish on Disney (DIS Quote), Nike (NKE Quote), Under Armour (UA Quote), Safeway (SWY Quote), Caremark (CMX Quote), Express Scripts (ESRX Quote), RBC Bearings (ROLL Quote), Amerisafe (AMSF Quote), Avis Budget (CAR Quote), AutoNation (AN Quote), IAC Interactive (IACI Quote), Harley-Davidson (HOG Quote), Home Inns & Hotels (HMIN Quote) and Intercontinental Exchange (ICE Quote).

Cramer was bearish on Finish Line (FINL Quote) and Whole Foods (WFMI Quote).

For more of Cramer's insights during the Lightning Round, click here.

Want more Cramer? Check out Jim's rules and commandments for investing from his popular book by clicking here.

1 What would best describe your stance heading into the coming week of trading? Bullish Bearish Neutral 2 Which of these sectors do you think is set to move up in the coming week? --Choose One--Aerospace and DefenseAirlinesAutomobilesBeverages and Food ProductsBiotechnologyCommercial BanksComputers and PeripheralsConsumer NondurablesEnergy Equipment & ServicesHMOs and HospitalsHomebuildingInsuranceIntegrated OilInternet, Software ServicesInvestment Bankers and BrokersMediaMultiline RetailPharmaceuticalsPrecious MetalsSemis, Semi EquipmentTelecom EquipmentTobacco and AlcoholWireless CommunicationsUtilities 3 Which of these sectors do you think is set to move down in the coming week? --Choose One--Aerospace and DefenseAirlinesAutomobilesBeverages and Food ProductsBiotechnologyCommercial BanksComputers and PeripheralsConsumer NondurablesEnergy Equipment & ServicesHMOs and HospitalsHomebuildingInsuranceIntegrated OilInternet, Software ServicesInvestment Bankers and BrokersMediaMultiline RetailPharmaceuticalsPrecious MetalsSemis, Semi EquipmentTelecom EquipmentTobacco and AlcoholWireless CommunicationsUtilities View the results without voting