Cramer's 'Mad Money' Recap: Toolmaker Power Play

Black & Decker(BDK Quote) will soon unveil a new line of DeWalt cordless tools that are as powerful as its corded ones, Jim Cramer told viewers of his "Mad Money" TV show Tuesday.

He said that means the stock could hit $100. Black & Decker closed Tuesday's session at $92.30; its 52-week high is $94.90.

Cramer believes the new line of tools, which the company says will arrive in stores later this quarter, makes this stock a serious buy. All the best tools need a power line, which is "a huge pain." But if the new cordless tools do have the promised power, they will boost the company's sales, he said.

Since the beginning of 2005, Black & Decker has bought back 10% of its stock and its last quarter was "awesome," Cramer said. Earnings per share were up 11% on revenue that only edged higher, he added, which shows that the company executed some serious cost-cutting and margin improvement.

Moreover, the company managed to cut costs despite higher raw material costs, he said.

The company's power tool sales rose by only 2% last year, so this new line is important because it should "clear up the one weak spot with new sales."

And even though the housing market is cooling, Cramer said that people will spend more time fixing up their homes rather than buying new ones. This trend should help companies that are levered to home improvement, including Black & Decker.

Schematic Biotech Buy

"There's pin action everywhere you look" Cramer said, including the recent Goldman Sachs(GS Quote) and Merrill Lynch(MER Quote) insider-trading scheme.

Three guys in low level positions were making millions before they were caught, and even in this piece of news it's possible to find a stock play, he said.

As part of the case, the Justice Department alleged that a man from Merrill leaked confidential information about Celgene(CELG Quote), including the fact that it was the target of a takeover.

The stock spiked for no apparent reason right around the time this insider information was leaked, but Cramer said he has no way of knowing whether this was the reason why.

There's a school of thought, "the Richard Nixon school of investing," he said, that holds someone must know something he shouldn't if a stock moves for no reason.

If Celgene was ever in talks to sell itself, the potential buyer might want to come back now that the situation at Celgene is better and the stock is down as biotechs sell off en masse.