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Cramer's 'Mad Money' Recap: Green Market

TheStreet.com Staff

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"We tend not to think of the U.S. Supreme Court as a way to make money," and usually that's right, Jim Cramer told viewers of his "Mad Money" TV show Monday.

However, on April 2, a Supreme Court decision against the U.S. Environmental Protection Agency has turned this whole theory around, he said.

The state of Massachusetts sued the EPA for not regulating carbon emissions from cars, Cramer explained. The court then ruled that the agency has the authority and responsibility to mandate these issues. And now the EPA "must regulate carbon dioxide emissions," which means there is "pressure for companies to become more green," he said.

"Nobody's going to change because it's the right thing to do ... but now it's no longer economical to do the wrong thing," Cramer said. "This decision makes investing in clean energy smart."

Now that the rules have changed, if a company is green "it's time to take a second look" at it, Cramer said, because "this decision puts a higher multiple on everything green."

Because "green stocks" are about to get more expensive, Cramer said he needs people in them. He said he is marking April 2, the day the Supreme Court handed down this decision, as "Green Day" and is denoting an entire weeklong series to Green Day.

"It's time to change our position on companies that encourage going green," Cramer said. "This is a landmark decision."

Environmentally Friendly

"Every stock levered to a cleaner environment should go higher in the near future," he told his viewers.

On the first day of his "Green Day" series, Cramer focused on his two favorite plays in the power sector: Foster Wheeler (FWLT) and Shaw Group (SGR). These two companies, he said, are "making themselves cleaner and the atmosphere cleaner."

Now that the Supreme Court has decided to make pollution "public enemy No.1," Foster Wheeler "is attractive for its low multiple," Cramer said. "This one is going to take a huge run." He believes that the $68 stock will go to $105.

Foster Wheeler is "a leader in fluidized bed boilers," Cramer said. Power plants use boilers to convert coal, gas or wood into energy, and the best part about Foster Wheeler's boilers is that they're "flexible" and allow power plants to cut sulfur dioxide and nitrogen oxide emissions, he said.

"This company is so in the sweet spot, it's scary," Cramer said, adding that regardless of its environmentally friendly nature, he considers it a "great buy" right now.

Moreover, Shaw Group has nuclear power, which is the "best way to go -- from a global warming perspective," he continued. It recently won a couple of contracts, expects to get more contracts in the next few months and "has a huge inside edge on nuclear projects in the U.S. and abroad," according to Cramer.

In the next few years, these two stocks should make people some mad money, said Cramer, who would "buy them both."

Applause, Applause

If Cramer had come on the show seven weeks ago when the market was going down and advised people to take all their money out of stocks, he would have been "applauded by the media," Cramer said. But at the same time, he would have been "painfully wrong."

"Instilling fear has always been seen as being the height of responsibility" in the market, Cramer said. However, instead of doing that, Cramer told people to buy stocks such as Kellogg (K) and Coca-Cola (KO).

Then Cramer said it was OK to buy the banks, the second group to bottom. "The second bottom that I called is still happening," and this is the week in which the analysts will start upgrading these stocks, he said.

What market players want to buy here is Goldman Sachs (GS), which he owns for his charitable trust, Action Alerts PLUS, Cramer said.

Although people might think he is "irresponsible this time around" for recommending Goldman Sachs, Cramer said he feels it is a "cheap, high-quality member of the financial group," which he expects to go higher.

Further, he believes that "the stigma of credit cards is going to go away" and that Capital One Financial (COF), which he also owns for his charitable trust, should go higher.

"I own them both, and I think they're great," Cramer said.

Mad Mail

In his "Mad Mail" segment, Cramer told a viewer that ValueClick (VCLK) and aQuantive (AQNT) may have moved up, but in the end he believes that both are going to be acquired.

Responding to another mailer, Cramer said nobody could have seen the Steel Technologies (STTX) buyout coming, since the "media was so negative on this group because of the steel glut."

However, he believes that more consolidation in this group is coming and that the sector is going to end up having only three or four players in total.

Lightning Round

Cramer was bullish on Cepheid (CPHD), General Maritime (GMR), Kinder Morgan Energy Partners (KMP) and Nastech Pharmaceutical (NSTK).

Cramer was bearish on Tribune (TRB), Excel Maritime Carriers (EXM), Dyax (DYAX), Meruelo Maddux Properties (MMPI) and Houston Wire & Cable (HWCC).

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.