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The best stocks for the next six months?
"It's all about health care," Jim Cramer said Monday evening on his "Mad Money" show on
. It's all about cost containment and the drug disbursement companies that will be big winners because of Medicare changes that go into effect in 2006.
"These stocks are just like the oils were at the beginning of the year," Cramer said. "Health care is the new oil."
So, how do investors take advantage of the Medicare changes? Cramer outlined five stocks that will do particularly well. Cramer said the following are the five "must-own" stocks:
, which is the best cost-containment company in the country. "At less than 51 smackers, it's a great deal," Cramer said.
( CMX), a pharmacy benefit manager, has Medicare exposure, Cramer said.
, an institutional pharmacy.
are both great pharmacies. Cramer doesn't know which one will do better, so he said own both.
In addition to the five, Cramer added two more names to the mix. These two stocks, however, should be put into your "Mad Money" speculative portfolio. They are
. These companies, which make software for hospitals and doctors' offices, help companies save time, money and lives, Cramer said. What's more, they have lots of potential for growth because there is only 5% market penetration right now.
Cramer did say to stay away from one name, though:
. The managed care services company will not do well, he said.
'The Lightning Round'
Cramer was bullish on:
New York Community Bancorp
Life Time Fitness
Quantum Fuel Systems
Cramer was bearish on:
Alaska Communications Systems
Last week, Cramer discussed
a basket of security stocks that investors should own. Within that basket was
( GEPT). The company has risen more than 80% since Thursday when Cramer first mentioned it. But when the stock is up this much, Cramer said, you have to take profits.
"When you have gains of 100%, you need to take something off the table," he said. Remember: "You haven't made a dime until you sell," he stressed.
Cramer told a caller that when you get stocks like Global E-Point, which make huge moves, you should trade around the portfolio. You sell half the position in the stock, Cramer said, and hope that the stock falls so that you can buy more.
At the time of publication, Cramer was long Boeing, GameStop and UnitedHealth Group.
James J. Cramer is a director and co-founder of TheStreet.com. He contributes daily market commentary for TheStreet.com's sites and serves as an adviser to the company's CEO. Outside contributing columnists for TheStreet.com and RealMoney.com, including Cramer, may, from time to time, write about stocks in which they have a position. In such cases, appropriate disclosure is made. To see his personal portfolio and find out what trades Cramer will make before he makes them, sign up for Action Alerts PLUS by
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