Cramer's 'Mad Money' Recap: Three IPOs, Three Strategies

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There are three big initial public offerings scheduled this week, but not all IPOs are worth buying, Jim Cramer told viewers of his "Mad Money" TV show Tuesday.

One of the companies slated to have its public debut is Kellogg Brown and Root, the engineering and construction unit of Halliburton (HAL Quote), a stock that Cramer owns for his Action Alerts PLUS charitable trust.

If people pay any attention to the media, they might believe that KBR, which does a lot of contract work in Iraq, is not the nicest business because of rumors that surround the company, Cramer said. However, it is because of this "political baggage" that KBR is being priced at a "sickeningly cheap" price, he said.

Cramer does not believe the politics will hurt the company's bottom line. In fact, KBR has $15 billion of projects ready to get done in its backlog.

"KBR is being issued at a huge discount," he said. "It is in the public eye and apparently the market doesn't like that, but there's no reason for it to trade at a discount."

Once KBR is its own company, its numbers will start speaking for themselves, Cramer said. The IPO is "vastly oversubscribed," he went on to say, and market players have two choices to get some KBR action.

One way is to wait until it becomes public (the IPO has been slightly delayed), but Cramer does not believe this is the right way to get in it. The other way for market players to get KBR exposure is by buying Halliburton.

He believes people should get into Halliburton, not only for KBR, but also because it has the lowest multiple of the oil service group.

The separation of the companies should be good for KBR as well as Halliburton and should cause both to go up, Cramer said.

"I would be a buyer of KBR even after all the bad things the media has to say about it," he said. "And I would be a buyer of it through Halliburton."