'Real Money' Radio Recap: Don't Mess Up Tech

Were investors too tough on tech after Dell(DELL) and Cisco(CSCO) reported disappointing numbers last week?

In his first radio show after a vacation, Cramer took a look at technology stocks after Dell and Cisco roiled markets with their earnings reports.

His assessment? Sure, Dell messed up on pricing its PCs, and Cisco's guidance was too conservative. But Cramer admonished: "Shame on you for selling tech for this!" Although he wouldn't dismiss the results as aberrant, he said a closer look shows they're in line with his bullish tech thesis for the rest of the year.

In Dell's case, it blew out PC unit sales but priced products poorly. That doesn't mean investors should sell Intel(INTC) and Microsoft(MSFT), both of which Cramer owns for his charitable trust, ActionAlertsPLUS.

Cramer believes this means buy Intel and Microsoft, because they're levered not to Dell's margins, but to Dell's volume. The more units Dell sells, the more those two companies will make, regardless of Dell's profit.

Cisco's harder to figure, said Cramer -- it's not going to be a beneficiary of the big product cycles that are driving tech. Its business was up 27% year over year and overall orders were strong, but Cisco lacks leverage to the product cycles Cramer is nuts about, so it's not as compelling a tell.

Intel and Microsoft, on the other hand, have much ahead that is exciting and will lead to gigantic upgrade cycles that should spur sales. And Cramer claims the worst thing to do now is to sell Dell in this seasonably strongest part of the year. The build starts now for consumer holiday products that he wants to profit from, and his anecdotal checks indicate strong demand.

Any declines in tech from here to September are gifts, he says. Why do we always have such big second-half runs in tech? Because every year in July and August investors can't stomach the kind of disappointments we get in companies like Dell, so they sell the stock. They're then compelling opportunities for the second half. His recommendation to the queasy: "Go take some Dramamine to fortify you to hang on for the upcoming, vigorous gains."