Jim Cramer's 'Stop Trading!': Ride the Coal Train

Buy Norfok Southern (NSC Quote - Cramer on NSC - Stock Picks) and CSX (CSX Quote - Cramer on CSX - Stock Picks) as a play on U.S. coal exports, Jim Cramer said on CNBC's "Stop Trading!" segment Friday.

Cramer noted that the two railroad companies are crucial in the transport of coal to ports.

"There's a worldwide coal shortage," Cramer said. "We don't like it in this country and the Democrats don't like it ... these are exports."

Cramer acknowledged that there has been some increase in the companies' capital expenditures, but the railroads are "making money hand over fist because they're a jolly happy oligopoly. ... Union Pacific (UNP Quote - Cramer on UNP - Stock Picks) is breaking out here. ... How are you gonna get the coal to the ports? You can't use trucks." Overall, Cramer had a very bullish outlook on the sector. "Big picture, they're making so much money, they can power back."

Nuclear power, on the other hand, isn't as strong as coal, Cramer believes. He noted that only NRG (NRG Quote - Cramer on NRG - Stock Picks) CEO David Crane has applied to build a nuclear plant in the U.S., and "there won't be a new one till 2014 if everything goes right."

Cramer steered investors toward coal miner Peabody (BTU Quote - Cramer on BTU - Stock Picks) as another way to play the sector. He also mentioned alloy company Allegheny Technologies (ATI Quote - Cramer on ATI - Stock Picks), which markets its products to energy and transport companies.

To finish his discussion of the energy sector, Cramer added, "I would urge people to recognize that the only real viable play here is natural gas and nobody's talking about it. ... We have so much more natural gas than we need."