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NEW YORK (
) -- It's time to start circling back to the best-performing stocks, Jim Cramer told his
TV show viewers Wednesday. Cramer said that when the bad news from Syria finally begins to subside, the stocks with the best earnings will be the first to rebound.
It may not be time just yet, but Cramer said he'd have money at the ready to buy stocks including
, two of the best-performing retail stocks of this quarter. He was also bullish on
among the biotech group.
Stocks with meaningful buybacks, such as
, are buys, said Cramer, especially if the market takes shares lower. He was also a fan of
in the health care group and both
Pioneer Natural Resources
in the oil patch.
In the packaged foods sector, Cramer said
, down 10% from its highs with a 4% yield, is very attractive, as is
Whole Foods Markets
Other potential buys on Cramer's list include
Executive Decision: Richard Smith
In the "Executive Decision" segment, Cramer sat down with Richard Smith, chairman and CEO of
, the real estate giant that lpays a part in nearly 26% of all existing homes sold in the U.S. Realogy last reported in July, posting a 22-cents-a-share earnings beat on a 17% rise in revenue. Shares trade at 15.5 times earnings with a 22% growth rate.
Smith said that despite the recent rise in interest rates, there's still enormous pent-up demand for homes at a time when interest rates are still very cheap historically. He said that coming out of what was a seven-year downturn will take years, so the recovery is still in the early innings.
When asked about home prices, Smith said valuations are still far from fair value. In some local markets, he said prices have snapped back a bit, but overall, there's still a long way to go. Smith also noted that prices are not responding to the recent rise in interest rates.
Turning to the issue of commissions paid to brokers, Smith said that currently the top brokers are producing the lion's share of business, thus commissions are higher. As sales volume increases, more brokers will enter the market and less commissions will be paid to those newer brokers, thus lowering the average.
Cramer said that with 26% of the realty market, Realogy is a pretty big player.
Off the Charts
In the "Off The Charts" segment, Cramer went head to head with colleague Carolyn Boroden over the direction of the markets.
According to Boroden's analysis, a daily chart of the
shows the selloff may be coming to an end in just a few days. She noted floors of support between 1,615 and 1,621 as well as between 1,578 and 1,582. As long as the index holds those levels, it's likely to rebound, said Boroden. But more important than price is timing. Boroden also noted that most selloffs average 18 days in length, meaning a rally is due between this Friday and Labor Day.
Looking at a chart of the
Dow Jones Industrial Average
showed similar patterns, with a floor at 1,560 and timing predicting a snap back before the holiday.
But according to Dan Fitzpatrick, another technician who predicted more pain for the markets just last week, the S&P 500 falling below its 50-day moving average is a big bearish flag, one that confirms his thesis that the markets will remain in a trading pattern from now through the end of the year.
Cramer said he views these analyses as reasons to be cautious, and to wait for more market weakness before buying into any of the stocks he mentioned at the top of the show.
In the Lightning Round, Cramer was bullish on
Cramer was bearish on
Am I Diversified?
In the "Am I Diversified?" segment, Cramer spoke with callers and responded to tweets sent via Twitter to
to see if investors' portfolios have what it takes for today's markets.
The first portfolio included:
American International Group
Royal Bank of Scotland
( SNVS) and
Cramer identified three-of-a-kind with this portfolio and said Royal Bank and Sonovus needed to be sold to make room for a drug stock and a defense stock.
The second portfolio's top holdings included:
Bank of America
Medical Properties Trust
Cramer said Google was too similar to ChannelAdvisor and he'd sell ChannelAdvisor and pick up a food stock that offers some dividend yield.
No Huddle Offense
In his "No Huddle Offense" segment, Cramer said there was a telling divergence in the markets today, with the consumer packaged goods stocks selling off far more than the rest of the market.
Cramer said that stocks including
Procter & Gamble
all sold off big today, and likely aren't done going lower.
These stocks are tied to the rise in interest rates, Cramer theorized, and with rates likely to tick up even further, it will put even more pressure on these consistent earners with great dividend yields.
As other investments get more attractive, these stocks will be less attractive, said Cramer, and that means their stocks are likely to go nowhere. Since these companies are too big to be taken over unless they split up to unlock value, there's little management can do to change the tide.
If the economy slips back into recession, then consumer stocks will be back in vogue, Cramer concluded. Barring that, there's a lot more pain ahead.
To watch replays of Cramer's video segments, visit the Mad Money page on CNBC
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-- Written by Scott Rutt in Washington, D.C.
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