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Cramer's 'Mad Money' Recap: Aug. 27

Cramer expects the retailer to bounce back after it missed estimates in the past quarter.
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"It's time to buy

J. Crew


," Jim Cramer told viewers of his "Mad Money" TV show Wednesday.

Cramer made his recommendation despite the retailer's botched quarter and an abysmal stock performance this year. The stock is down 46% since December.

Cramer said that while J.Crew has been on a one-way ticket lower all year, he feels that now is the time to invest. He put a $35 price target on the stock one year from today.

While the overall retail environment remains bad, with slowing store traffic, Cramer said only

Urban Outfitters



TJ Maxx


and J. Crew have the ability to buck the trend and head higher.

Cramer said he believes J. Crew's recent earnings miss was due in large part to problems with the company's Website. With the overhaul of the Website nearing completion, Cramer said the retailer should regain its footing.

Cramer put his support behind CEO Mickey Drexler, a man who Cramer says turned around

Gap Stores


, and founded Old Navy.

While many CEOs in retail are "one-hit wonders," Cramer said Drexler is a standout. He said the time to invest with Drexler is when he's out of favor, which he is right now with the stock of J. Crew cut almost in half since December.

Cramer said J. Crew may still go lower from here, but feels the momentum will swing upward once the 12 analysts who currently rate the company as a hold begin to see the light and upgrade the stock.

Cramer: The FDIC Needs a Plan -- Now

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Stick With Walgreen

For his "In The Ring" segment, Cramer pitted

CVS Caremark





, which he also owns for his

Action Alerts PLUS portfolio, to determine which drugstore giant is the better buy.

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When looking at the drugstore sector overall, Cramer gave both company's a 4 out of 5, as drugstores offer safety and consistency in uncertain markets. He reminded viewers that 50% of a stock's performance is usually linked to its sector.

Next, Cramer looked at growth. For drugstores, Cramer said the key metric is same-store sales. CVS last reported same-store sales up 3.1%, while Walgreen reported 4.1%, giving the latter a one-point lead on Cramer's scorecard.

Cramer also considered each company's growth strategy. Last year CVS acquired Caremark, a pharmacy benefits manager, and by all accounts that acquisition has not gone well.

Meanwhile, Walgreen has stuck to its core strategy of being just a great pharmacy and drugstore, he said. Cramer awarded one point to CVS for its strategy, but none for its execution, while awarding Walgreen a point for its simplicity.

In the end, Cramer said Walgreen comes out on top 7-5 on his scorecard. He said this is not a market that values complexity or poor execution and CVS unfortunately has both.

Am I Diversified?

Cramer spoke with callers to see if their portfolios have what it takes.

The first caller's portfolio included




Bristol-Myers Squibb






General Electric






Cramer called this portfolio "perfect" and said he loved it.

The second caller's top holdings included

Great Lakes Dredge



Darling Int'l









Temple Inland



Cramer said this portfolio also was perfect for this market.

The third caller had




Terra Int'l






John Deere





as their top five stocks.

Cramer identified two of a kind with Terra and Deere, and he recommended selling Terra for a defense stock or industrial company.

Mad Mail

In this segment, Cramer clarified an earlier "Sudden Death" call to sell

Banco Santander-Chile



He said he still likes Santander but he meant to say he recommended selling the European bank

Banco Santander



He told a second viewer not to invest in any single home building stock, but instead to invest in a home building index if they feel home builders are on the rise.

Sudden Death

Cramer was bullish on

Dawson Geophysica



Bristol-Myers Squibb






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Lightning Round

Cramer was bullish on

Emerson Electric



Cisco Systems



GrafTech International












He was bearish on

Terra Nitrogen



Ambac Financial Group



ACCO Brands


.P/>Want more Cramer? Check out Jim's rules and commandments for investing by

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Read more of Cramer's Mad Money Lightning Round insights


For "Mad Money" performance statistics and other links, check out Mad Money stats

At the time of publication, Cramer was long on Walgreen, Cisco.

Jim Cramer, host of the CNBC television program "Mad Money," is a Markets Commentator for, Inc., and CNBC, and a director and co-founder of All opinions expressed by Mr. Cramer on "Mad Money" are his own and do not reflect the opinions of or its affiliates, or CNBC, NBC UNIVERSAL or their parent company or affiliates. Mr. Cramer's opinions are based upon information he considers to be reliable, but neither, nor CNBC, nor either of their affiliates and/or subsidiaries warrant its completeness or accuracy, and it should not be relied upon as such. Mr. Cramer's statements are based on his opinions at the time statements are made, and are subject to change without notice. No part of Mr. Cramer's compensation from CNBC or is related to the specific opinions expressed by him on "Mad Money."

None of the information contained in "Mad Money" constitutes a recommendation by Mr. Cramer, or CNBC that any particular security, portfolio of securities, transaction, or investment strategy is suitable for any specific person. You must make your own independent decisions regarding any security, portfolio of securities, transaction, or investment strategy mentioned on the program. Mr. Cramer's past results are not necessarily indicative of future performance. Neither Mr. Cramer, nor, nor CNBC guarantees any specific outcome or profit, and you should be aware of the real risk of loss in following any strategy or investments discussed on the program. The strategy or investments discussed may fluctuate in price or value and you may get back less than you invested. Before acting on any information contained in the program, you should consider whether it is suitable for your particular circumstances and strongly consider seeking advice from your own financial or investment adviser.

Some of the stocks mentioned by Mr. Cramer on "Mad Money" are held in Mr. Cramer's Action Alerts PLUS Portfolio. When that is the case, appropriate disclosure is made on the program and in the "Mad Money" recap available on The Action Alerts PLUS Portfolio contains all of Mr. Cramer's personal investments in publicly-traded equity securities only, and does not include any mutual fund holdings or other institutionally managed assets, private equity investments, or his holdings in, Inc. Since March 2005, the Action Alerts PLUS Portfolio has been held by a Trust, the realized profits from which have been pledged to charity. Mr. Cramer retains full investment discretion with respect to all securities contained in the Trust. Mr. Cramer is subject to certain trading restrictions, and must hold all securities in the Action Alerts PLUS Portfolio for at least one month, and is not permitted to buy or sell any security he has spoken about on television or on his radio program for five days following the broadcast.