Cramer's 'Mad Money' Recap: High Contrast

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Buy Texas Instruments (TXN Quote), Corning (GLW Quote) and Trident Microsystems (TRID Quote) to take advantage of the coming growth in sales of high-end TV sets, which are sure to be hot items this holiday season, Jim Cramer said Tuesday on "Mad Money."

Prices are coming down significantly, he said, for digital light processor and liquid-crystal display TV sets. (Prices of plasma TVs, however, are another story.)

Falling prices, Cramer said, are sure to spur demand.

Compare and High Contrast

But, don't buy the stocks of the TV manufacturers such as Sony (SNE Quote) and Samsung or Dell (DELL Quote). Those companies' margins will be squeezed by the falling prices, Cramer said.

Instead, buy their suppliers: Texas Instruments, Corning and Trident. Of the three, Cramer said, Corning is his favorite.

The time to buy is now, though. If you wait until Christmas, you're going to miss the trade, Cramer said. Sony, Samsung and other companies are placing orders with their suppliers now in order to make Wal-Mart's (WMT Quote) and Best Buy's (BBY Quote) holiday seasons. Thus, now is the holiday season for suppliers.

A caller asked if the high-end TV manufacturers wouldn't possibly squeeze their suppliers in order to get lower component prices. Cramer said this is not a likely scenario because there simply are not enough suppliers. Texas Instruments, for example, is only one supplier for DLP TV technology.

Another caller asked if high-end TVs were going to be such hot sellers at Christmas, should he also buy the stock of Best Buy?

Cramer said he thought Best Buy still "has a little more downside. I want to wait until September before I pull the trigger on that one."