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Playing Defense

This Action Alerts PLUS alert was originally sent to subscribers on July 13 at 11:36 a.m. EDT. It's being republished as a bonus for TheStreet.com readers.

I don't just want to add to my cyclical stocks on this extended market decline, though I do believe the names I'm buying -- or would be buying if my restrictions allowed -- will be among the first to recover in the next rally.

That said, I want to make sure that I have a sizable position in my defensive names, as they are the stocks that will likely continue to be the most consistent performers through the remainder of 2006.

With that in mind, I'm going to purchase 200 shares of Anheuser-Busch (BUD) after you read this note. Beer sales have been strong all summer long, and the company is facing easy annual comparisons for the rest of the year. I also expect management to boost the 27-cent quarterly dividend (2.4% yield) later this month, lending further support to the stock. This purchase gives me a total of 2,400 Anheuser shares, or 3.1% of the overall portfolio.

I'm also going to take advantage of the 2% decline in Newell Rubbermaid (NWL)this morning, to pick away at 300 shares here around $24.85. I believe the company will report another solid quarter on July 27, with resin costs on the decline and new CEO Mark Ketchum continuing to generate new revenue growth.

With that in mind, I believe the stock can trade up toward the high-$20s by the end of the year. This purchase rounds up my stake in Newell to 5,000 shares, or 3.5% of the overall portfolio.

At the time of publication, Cramer was long BUD and NWL.

Jim Cramer is a director and co-founder of TheStreet.com. He contributes daily market commentary for TheStreet.com's sites and serves as an adviser to the company's CEO. Outside contributing columnists for TheStreet.com and RealMoney.com, including Cramer, may, from time to time, write about stocks in which they have a position. In such cases, appropriate disclosure is made. To see his personal portfolio and find out what trades Cramer will make before he makes them, sign up for Action Alerts PLUS. Listen to Cramer's RealMoney Radio show on your computer; just click here. Watch Cramer on "Mad Money" at 6 p.m. ET weeknights on CNBC. Click here to order Cramer's latest book, "Real Money: Sane Investing in an Insane World," click here to get his second book, "You Got Screwed!" and click here to order Cramer's autobiography, "Confessions of a Street Addict." While he cannot provide personalized investment advice or recommendations, he invites you to send comments on his column by clicking here.

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