Cramer's 'Mad Money' Recap for July 22 - TheStreet

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Despite poor earnings reports, the drop in oil prices is driving the market higher, Jim Cramer told viewers of his "Mad Money" TV show Tuesday.

Oil is all that matters right now and the price of oil is on the decline, he said.

After companies such as

Apple

(AAPL) - Get Report

,

Texas Instruments

(TXN) - Get Report

,

SanDisk

(SNDK)

and

American Express

(AXP) - Get Report

disappointed with their earnings report Monday, everybody was expecting the market to "get crushed" Tuesday, he said.

"People were crying. Nearly everyone thought there would be some serious blood on the Street today," he said. "That didn't happen, the sky didn't' fall."

Instead the Dow surged with triple-digit gains Tuesday. No one knows why the market pulled through, except me, said Cramer.

The market was up because of the decline in price of oil and gas, he said.

"Oil and gas have come down hard," said Cramer. "Oil is down to $128 a barrel and I think it is going to $120."

The last time oil was at $126 a barrel, the S&P 500, which represents the broadest view of the market, was at 1,403. That's about 10% higher than the index is now. When natural gas was $9, the same index was 3.5% higher.

That means on an average, the S&P 500 is 6.7% lower and will head higher, said Cramer.

"The arithmetic of oil and gas and the decline in oil and gas are irrefutable," he said. "We are 6.5% too low (in the S&P) as of this evening and market is heading up there."

Cramer: JP Morgan Can Save Banks

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Consumer companies such as

Kimberly-Clark

(KMB) - Get Report

are likely to benefit, he said, since that is exactly the kind of defensive play that big institutional investors like to put their money into.

Cramer said he is predicting gasoline at $3.50 a gallon if oil prices fall to $120 a barrel.

"I need you to stop reacting to only the earnings and look at the bigger picture: the prices of oil and gas and the newfound health of banks," he said. "This market's a buy."

Natural gas prices are likely to go lower. That means

Chesapeake Energy

(CHK) - Get Report

is a bargain at $51, which is where the stock closed Tuesday, said Cramer.

"I like to buy when I can, not when I have to," said Cramer.

Cramer also warned retail investors against trading during after-hours. "No trading after hours," he said. "Everyone loses money."

Poised for a Turnaround

Campbell Soup

(CPB) - Get Report

is chicken soup for your portfolio, said Cramer.

Image placeholder title

In the past, the stock has been a serial underperformer. The company missed four straight quarters before finally pre-announcing some good news recently but everybody ignored it, he said.

Campbell has been a really poor investment over last 10 years, having fallen almost 35% from $54.90 to $34.30 currently.

But now the company is looking better, he said, and is a possible recession-proof play.

General Mills

(GIS) - Get Report

and

Kellogg

(K) - Get Report

are at or near their 52-week highs, which means Campbell looks cheap and institutional money could flood to the stock and raise its price, he said.

"While I have liked many a food stock, especially

Heinz

(HNZ)

, I have trashed Campbell," said Cramer. "Now I am changing my mind and tune and getting behind it."

Campbell has launched new products such as its range of Select Harvest light soups, which could be give its rival Progresso tough competition.

The company is making record high investments in marketing and expanding into international markets such as China and Russia. "It may finally get its groove back," he said.

Campbell also has a big buyback going on with plans to repurchase $1.2 billion worth of its shares, or 9.2% of its market cap. "I like big buybacks and you can't get any bigger than Campbell's, he said.

A weak dollar also means that a European buyer could in and buy the company for almost 25% less than where it was two years ago, said Cramer. "A name brand like Campbell hasn't been this cheap in years," he said.

Cramer also advised a listener to sell

Kraft

(KFT)

and recommended

Tyson Foods

(TSN) - Get Report

.

Stupid Thinking

Not all financial services stocks need to go down because of

American Express'

(AXP) - Get Report

"simply miserable quarter," said Cramer.

American Express was down nearly 7% following its earnings and it affected other banking stocks.

Bank of America

(BAC) - Get Report

and

JP Morgan

(JPM) - Get Report

all stayed down Tuesday.

But there is no reason to believe that bad news at American Express is bad news for JP Morgan, said Cramer. "That's kind of stupid thinking," he said. "Don't panic because of traders who can't see the difference between American Express and JP Morgan," he said.

The difference between American Express and banks is that the former makes money from transaction fees, membership fees and interest on loans.

For banks such as JP Morgan and

Wachovia

(WB) - Get Report

, deposits are the key.

If anything, American Express has more in common with retailer

Target

(TGT) - Get Report

. Target has a big credit card business, but it also has a retail component to fall back on, which is not the case with American Express.

That why Cramer prefers Target. "American Express has unfairly brought down all banks. Use it as an opportunity to buy," he said.

Cramer suggested Wachovia, Bank of America,

US Bancorp

(USB) - Get Report

and JP Morgan as his four strong financial plays.

Mad Mail

In this segment, Cramer said he has lost a lot of money on

Annaly Capital Management

(NLY) - Get Report

and would not recommend it. It has too much leverage and he cannot go back to the stock after the money he has lost on it, said Cramer.

Cramer also explained the term, "multiplier," when it comes to assessing a stock's value. It refers to the price-to-earnings multiple.

Some stocks have a big multiple because they grow fast, he said. Stocks such as

Exxon Mobil

(XOM) - Get Report

and

ConocoPhillips

(COP) - Get Report

have a low multiplier because people expect lower growth in oil consumption.

Finally, Cramer suggested listeners look at

Google

(GOOG) - Get Report

as an attractive trade, in light of

Yahoo's

(YHOO)

weak earnings. And instead of Wachovia, consider US Bancorp for their trade.

Lightning Round

Cramer was bullish on

Disney

(DIS) - Get Report

,

Staples

(SPLS)

and

True Religion

(TRLG)

.

He recommended selling

United Airlines

(UAL) - Get Report

,

Veolia Environment

(VE)

,

Peabody Energy

(BTU) - Get Report

,

Acco Brands

(ABD)

,

Office Depot

(ODP) - Get Report

and

Colonial Bancgroup

(CNB)

.

Want more Cramer? Check out Jim's rules and commandments for investing by

clicking here

.

For more of Cramer's insights during the Lightning Round, click here

.

At the time of publication, Cramer was not long on any stock.

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."

None of the information contained in "Mad Money" constitutes a recommendation by Mr. Cramer, TheStreet.com 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 TheStreet.com, 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 TheStreet.com. 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 TheStreet.com, 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.