TheStreet.com TV Recap: Cramer Riffs on Telco Equipment

Jim Cramer ranked his top telecom-equipment makers on TheStreet.com TV's Wall St. Confidential Web video Monday.

"Ciena (CIEN Quote - Cramer on CIEN - Stock Picks) is No. 1 because it has some earnings," he told Gregg Greenberg, the host of Wall St. Confidential. The stock, which got an upgrade today, "is at the sweet spot of this."

Tellabs (TLAB Quote - Cramer on TLAB - Stock Picks) was the No. 2 pick because of its "rock-bottom valuation." Cramer said then he would focus on JDSU (JDSU Quote - Cramer on JDSU - Stock Picks). If JDSU does execute well, Cramer said he believes the stock could see 4 points to the upside, and only 1 point to the downside in case it doesn't execute.

Alcatel-Lucent (ALU Quote - Cramer on ALU - Stock Picks) was Cramer's fourth pick because he believes it can't be taken over.

Before he saw the numbers for Verizon(VZ Quote - Cramer on VZ - Stock Picks), which reported Monday, Cramer said he had considered Ciena a takeover name.

However, now that Verizon is leading with the notion that its capital expenditure is "bigger," he believes "Ciena is at the cusp of this major spending cycle," as are JDSU, Alcatel-Lucent and Tellabs.

The last two, he said, are "really important" because they completely missed earnings and are still going higher.

On the other hand, even though Vonage (VG Quote - Cramer on VG - Stock Picks) could go higher because of a short squeeze, this "principal taker of Verizon is falling apart," Cramer emphasized. Also, he said he believes Nortel (NT Quote - Cramer on NT - Stock Picks) is a "disaster."

"Forget Nortel," Cramer said. "I would rather own Ericsson (ERIC Quote - Cramer on ERIC - Stock Picks)."