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) -- Before you sell your stocks on the latest round of euro-fears, think about

News Corp


, Jim Cramer told his

"Mad Money"

viewers Tuesday. He said just the rumor the media giant might be breaking itself in two proves just how undervalued stocks have become.

If News Corp does indeed follow up on the rumors and split its fast-growing entertainment division from its non-growing publishing business, Cramer said shares could be worth up to $28. That's proof positive the markets aren't even looking at the fundamentals of the underlying companies anymore, he said.

The split makes total sense, noted Cramer, as News Corp's film and cable divisions are growing a 8% and 15%, while its news and magazine divisions are shrinking by 24% and 19%. That means that growth fund managers can pile into the entertainment division at lofty valuations while more conservative investors can stick with the lower valuations of the news division.

But News Corp is symbolic of a larger problem, said Cramer, as company after company is realizing just how poorly the markets are valuing their stocks and are doing something about it.


( KFT),

Sara Lee

( SLE),




Marathon Oil


have already announced breakup plans, and many more companies could follow suit.

So before investors sell their stocks based on the next Spanish bond auction or bailout plan, Cramer told them to think about these names and think about how much value there really is underneath that beaten down share price.

Executive Decision

In the "Executive Decision" segment, Cramer spoke with Tim Main, CEO of

Jabil Circuit


, a contract manufacturer that delivered in-line earnings when it last reported but also offered cloudy guidance for the rest of 2012. Shares of Jabil are eight points off their highs, trading at just seven times earnings with a 12% growth rate.

Main said Jabil has hit a "flat spot" in its growth and is currently a little below the trend line set at the beginning of the year. He said the company's transition away from consumer electronics and into industrial and medical applications is being hurt by the global slowdown, but by 2013 he expects growth to return along with more stable performance.

When asked whether customers like the beleaguered

Research In Motion

( RIMM) can hurt the company, Main said Jabil will remain as a "go-forward" partner for RIM. But with mobility now accounting for less than 10% of sales, he doesn't see RIM or any other single customer hurting Jabil's performance.

Cramer said that with



, a stock he owns for his charitable trust,

Action Alerts PLUS, expected to have a good second half of the year, Jabil should, too. He told investors to stick with the company.

UPS Vs. FedEx

When it comes to shipping companies, is






the better stock to own? According to Cramer, it depends on your time horizon and risk tolerance.

Cramer said investors looking for a quick gain should consider FedEx as the company trades at just 11 times earnings compared to 14 times earnings for UPS. FedEx is also in the middle of a restructuring, retiring older planes in tits fleet to save on fuel costs. All of those savings should become readily apparent at the company's analyst day in October, noted Cramer, which is why for the short term FedEx is the better trade.

But investors looking for a longer-term investment should consider UPS, said Cramer, as UPS has a higher dividend yield of just under 3%, and is the more consistent operator. UPS is currently buying the euro-based TNT, which, when the deal closes, will make UPS the largest shipper in Europe and help it realize up to $1.3 billion in cost savings by 2016.

While UPS maintains that the shipping business is just fine, Cramer said the European overhang will mean investors will be waiting longer for their gains. That's not a problem. however, as UPS offers the higher dividend yield, said Cramer, but investors will be paying more for that slow but consistent growth.

Lightning Round

Here's what Cramer had to say about callers' stocks during the "Lightning Round":



: "They blew the quarter and I need to hear from them. I am not recommending them."

Roundy's Supermarket


: "I'm sticking with them. That's not an expensive stock."

Banco Santander


: "I still think the stock is a sell, sell, sell."

Southern Company


: "That's a buy, buy, buy. I'll throw in

American Electric Power



Dominion Resources



Consolidated Edison



Duke Energy





: "Everyone has given up on it but I think that's a mistake. Next year will be good."



: "No, no.

International Paper


is the superior stock."

Spirit AeroSystems


: "Why own Spirit when I can own




Chimera Investment


: "I don't trust the stock. "

Thompson Creek Metal


: "Keep looking, don't pull the trigger. "

Off The Charts

In the "Off The Charts" segment, Cramer went head to head with colleague Tim Collins over the fate of natural gas, the commodity that never seems to stop heading lower.

According to Collins, after trading below $2 in late-April, natural gas was finally able to hold a higher low and make a bullish "W" formation. That, he said, is a good sign and if the commodity can surge above its ceiling of resistance at $2.75 we'd be off to the races. Collins used both the TRIX momentum indicator and the RSI, relative strength indicator, to confirm his thesis.

So how to play the move? According to Collins,

Ultra Petroleum


is the natural gas company with the best chart. Using a daily chart of Ultra, Collins was also able to see bullish signs in both the TRIX and RSI as well as a "cup and handle" pattern, a very bullish sign. Collins theorized that if Ultra could break above $21.50, the stock could see $25 a share by the end of August or sooner.

Cramer said many have predicted a bottom in natural gas, but he's inclined to believe Collins now that gas companies have finally cut back on supply and the U.S. is seeing increased demand for natural gas. Ultra, he said, is the best-run gas company out there.

No Huddle Offense

In his "No Huddle Offense" segment, Cramer opined on the increasing takeover chatter in the banking sector. He said there was once a time when bank mergers and acquisitions were a staple. Whether it was a bank with regional to national ambitions or a bank trying to fend off its competition or take advantage of an FDIC fire-sale, takeovers were everywhere.

But that all came to a screeching halt in the 2008 recession, said Cramer, when the notion of tangible book value, the matrix used to value a bank, became meaningless among incalculable loan losses.

But now that time has passed and home sales and values are again on the rise, Cramer said a bank merger or acquisition would not shock him. Cramer said he doesn't know if the

Regions Financial


rumors are true, but it certainly wouldn't surprise him.

--Written by Scott Rutt in Washington, D.C.

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Scott Rutt


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At the time of publication, Cramer's Action Alerts PLUS had a position in AAPL, BA and KFT.

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.