Wall St. Confidential: Cramer Says Bet on Chips

Chip inventory is being worked off, and that makes Texas Instruments (TXN Quote) a "screaming buy," Jim Cramer said on TheStreet.com TV's Wall Street Confidential video Webcast Thursday.

"The chip business is a business about inventory," he told Gregg Greenberg, the host of Wall Street Confidential. "When there's a lot of inventory, these stocks get clobbered."

A few weeks ago, Cramer said he had chip-distribution company Avnet's (AVT Quote) CEO Roy Vallee as a guest on his "Mad Money" TV show, and the chief executive told Cramer that chip inventory is being worked off.

Today, Jerald Fishman, the CEO of Analog Devices (ADI Quote), confirmed what Avnet said, Cramer said. So even though seasonably it shouldn't be happening right now, the inventory is being reduced, which means these companies can raise prices for a couple of months, he continued. This also means, he said, that the companies' next quarter should be good.

Further, in addition to Texas Instruments, Cramer believes Marvell Technology (MRVL Quote), which he owns for his charitable trust, Action Alerts PLUS, should be going up, as it correlates to Analog Devices.

Food Flight

When Greenberg asked if it was necessary for Whole Foods (WFMI Quote) to make a deal to acquire Wild Oats (OATS Quote), Cramer pointed out that the companies have been in a price war.