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"Being a great investor is all about finding stocks with the right mix of upside and security," Jim Cramer told viewers of his "Mad Money" TV show Wednesday. Such stocks can make people a lot of money and profit from the current environment.
, he said, fits both criteria. It is "the best gold stock to buy right now," Cramer said.
Gold is breaking out because of the weak dollar, lower short-term rates and worries about inflation, Cramer said. The commodity has always been a good hedge against this environment.
was Cramer's proxy for gold, the company has failed to buy more gold mines, he said.
Cramer said he's also taking a break from
, as its recent purchase of
was "a long-fought acquisition," and Cramer expects it will take a while for Yamana to digest it.
Instead, Cramer prefers Barrick, which has a lot of gold reserves and is "totally prepared for higher gold prices," he said. "The price of gold will be the price they get for gold."
If people believe gold prices are going down, then they shouldn't buy Barrick, but then they also should have their head examined, Cramer said. If gold goes to $1,000 an ounce, Cramer believes Barrick will go to $50 a share.
It's true that Barrick's finding costs have gone up, but that stems from mining issues that should be resolved in the near future, he said. Plus, the company has a new generation of mines becoming active, which should further reduce costs, and the stock does not have a lot of political risk. It is the "ideal gold stock" to own, Cramer said.
Athena, I Had No Idea...
All week Cramer told viewers he's looking at opportunities in overlooked initial public offerings. In his third installment of the series, he named
"probably the best" of his overlooked IPO lot, although "by far, the most expensive."
The company, which came public on Sept. 20, belongs to the pantheon of health care-solution stocks like
, Cramer said.
Cramer gave Allscripts the nod two days before Athenahealth's IPO. He said he didn't pay attention to the public offering when it happened. Cramer believes it is still early enough to get into Athenahealth, and because market players probably wouldn't have been able to get into the IPO anyway, they haven't really missed any gains here, he said.
Athenahealth, he said, is in the same business as Quality Systems and Allscripts, but conducts its business solely over the Web. "The market for this stuff is massive and it's nowhere near fully penetrated," Cramer said.
Athenahealth's service resolves 93% of its claims on its first try and has a 95% customer renewal, he continued. Its customers, Cramer said, are "loyal" and "addicted." And because its customers rarely drop the service, Athenahealth has a good case of recurring revenue.
The stock is currently trading at 46 times forward earnings. This might look expensive, Cramer said, but at the same time, Athenahealth has 42% growth.
Cramer urged viewers to consider getting into Athenahealth, but recommended using limit orders.
'Am I Diversified'
In his "Am I Diversified?" segment, Cramer's first caller named the following five stocks:
Annaly Capital Management
Cramer said the caller had too many tech stocks with SAP, Nvidia and BEA Systems. He advised the caller to keep BEA Systems, sell the other two and to consider buying a health care stock like
, which he owns for his charitable trust,
Action Alerts PLUS, and a defensive stock.
The second caller said his portfolio contained these five plays:
, the last two of which Cramer owns for Action Alerts PLUS.
Cramer called out another tech pair in Apple and Trimble. He suggested selling Trimble and, again, picking up a health care cost-container like Hologic.
The last player asked if he was diversified with the following five picks:
Research In Motion
Cramer blessed the portfolio as diversified.
During the "Mad Mail" segment, a viewer wrote in thanking Cramer for keeping it real and mentioned Cramer's recent call with George Feldenkreis, the CEO of
Cramer said that while Feldenkreis seemed like a great guy, he likes
Responding to another emailer, Cramer called
"still too expensive," and said he likes the cheaper
, which he owns for his charitable trust, better. "Stay away from Walgreen," he said.
Cramer was bullish on
, Apple and
Cramer was bearish on
During the "Sudden Death" round, Cramer was bullish on
Want more Cramer? Check out Jim's rules and commandments for investing from his latest book by
For more of Cramer's insights during the Lightning Round, click here
At the time of publication, Cramer was long CVS Caremark, Freeport McMoRan, Hewlett-Packard, Hologic and Goldman Sachs.
Jim Cramer, host of the CNBC television program "Mad Money," is a Markets Commentator for TheStreet.com, Inc., and CNBC, and a director and co-founder of TheStreet.com. All opinions expressed by Mr. Cramer on "Mad Money" are his own and do not reflect the opinions of TheStreet.com 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 TheStreet.com, 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 TheStreet.com is related to the specific opinions expressed by him on "Mad Money."
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