Cramer's 'Mad Money' Recap: Spec Medicine

Pop Quiz! Are you a loyal "Mad Money" viewer? Take TheStreet.com's new "Mad Money" culture quiz to see how much of the show you've caught this week or just to immerse yourself in Cramer's nonfinancial madness.

Click here for an archive of Cramer's "Mad Money" recaps.

---

Kinetic Concepts (KCI Quote) is a speculative medical stock folks should consider getting into, Jim Cramer told viewers of his "Mad Money" TV show Friday.

Cramer, who each Friday devotes part of his show to speculative stock ideas, suggested two such plays for viewers to research over the weekend.

First up was Kinetic Concepts, which designs and manufactures wound-care and therapeutic-service products. Cramer said he considers the stock speculative because "it's not a pastiche." It doesn't have a variety of product but instead is only levered to the wound-care business, he said.

For medical companies, Cramer generally likes ones that have a mosaic of businesses, but in the case of Kinetic Concepts he believes it's OK to speculate. Wall Street, he said, "falls in love" with these types of companies before "falling in hate" with them. Cramer believes all market players have to do here is get into Kinetic Concepts during that honeymoon phase.

The stock took a "nasty beating today," but Cramer said he's not that worried. All of the smaller stocks in the medical-device sector are "notorious" for having bulls and bears fighting it out and pushing the stocks either up or down, he explained. This time, Cramer's money is on the bulls.

The big fear, he said, is that Kinetic Concepts, which has reached about 90% of the saturation point in the wound-care business, won't be able to defend its market share from Smith & Nephew (SNN Quote), which entered the market via an acquisition today of BlueSky Medical Group.

However, Cramer believes Kinetic Concepts "has too many competitive advantages" to not be able to able to defend its market share. In addition, he believes Kinetic Concepts' decline today was "overdone." The stock closed down 3% at $47.25 Friday.

The bandages make up just 10% of the company's total revenue, Cramer said. This stock should bounce back. "If you have an open spot in your portfolio, consider filling it with KCI."