This Day On The Street
Continue to site right-arrow
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Jim Cramer's 'Mad Money' Recap: Biotech Sector Havoc Can't Be Ignored

Search Jim Cramer's "Mad Money" trading recommendations using our exclusive "Mad Money" Stock Screener.

NEW YORK ( TheStreet) -- The havoc in the biotech sector may be too great to ignore, Jim Cramer cautioned his Mad Money viewers Monday as he advised investors to take profits in the group or wait on the sidelines until the carnage subsides.

Cramer explained that today's news that Gilead Sciences (GILD) may lose its virtual monopoly on treating Hepatitis C, news that sent shares down 14%, is cause enough for concern for all biotech investors. Competition is great for consumers, Cramer said, but it's a killer for companies and their stocks.

Must Read: Cramer: What Stocks You Can Still Buy in This Rally

Just look at the phone companies, Cramer continued. Both Verizon (VZ) and AT&T (T) are down on the year, with T-Mobile (TMUS) down 21% and Sprint (S) shares plunging 61%, all because of increased competition.

Competition is why the auto sector is lower and why credit card processors Visa (V) and MasterCard (MA)  aren't.

The opposite of competition is consolidation, which is why the airlines have been soaring and why the drugstore stocks have also seen relief in 2014. Competition, or the lack thereof, is also why Facebook (FB) , which Cramer owns for his charitable trust, Action Alerts PLUS and a company with a monopoly on our virtual selves, is also having a very happy holiday this year.

For for the biotech sector, Cramer warned there will likely be more profit taking to come as investors sort out the new landscape, which could include more competition for hot franchises.

This Sector Makes Cramer Smile

What's the hottest performing group in market right now? Is it social media? Biotech? Nope. It's the dental supply stocks.

Cramer said there's a lot to like about the dental stocks. First, they aren't linked to where the price of oil is or how the Russian ruble is trading. They do, however, benefit from an aging population here at home and the fact that many people put off getting expensive dental procedures done during the recession. Add all that to the world's growing middle class and Cramer said it's easy to see why this is a red-hot group.

Of the group, Cramer said he likes Henry Schein (HSIC) the best. The stock is up nearly $8 since he spoke to the CEO last month, and shares are up 17% over the past three months. Stein is the number one player in the dental space but also has an animal health and vaccine business to boot, yet trades at just 23 times earnings.

Also on Cramer's buy list is Patterson Companies (PDCO) , the number two player with shares up 21% over the past year, and Sirona Dental (SIRO) , a high-tech provider of dental equipment with shares up 15% over the past three months.

In addition, Cramer mentioned Align Technology (ALGN) , makers of Invisalign braces, as a company with lots of upside but also more than its share on short sellers, and Dentsply (XRAY) , a stock he didn't care for given its exposure to Europe.

Must Read: No Bargains in Rising Market: Why Not Buy High and Sell Higher?

Check Out Our Best Services for Investors

Action Alerts PLUS

Jim Cramer and Stephanie Link reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

Jim Cramer's protégé, David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
Try it NOW
Try it NOW
Try it NOW

Check Out Our Best Services for Investors

Dividend Stock Advisor

Jim Cramer's protégé, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
Try it NOW
Try it NOW
Try it NOW
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!


DOW 17,959.44 +154.64 0.87%
S&P 500 2,078.54 +7.89 0.38%
NASDAQ 4,781.4240 +16.0440 0.34%

Brokerage Partners

Rates from

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs