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It's time to dip into the liquor business, Jim Cramer told viewers of his "Mad Money" TV show Thursday, and that means it's time to look at
He said this is the company to consider for investors who want to be in the high end of the liquor business. Diageo's product line includes such brands as Smirnoff vodka, Johnnie Walker scotch and Guinness stout.
He called it an "unsponsored" company with great growth and a great dividend.
"This stock is stuck in the mud and I want it unstuck, and that's why I picked it," Cramer said.
Profits at the London-based company, which reported its six-month results Thursday, have soared. Cramer cited Diageo's 7% American growth, 12% growth outside of America and 12% EPS growth, which he believes could go higher, as well as its "juicy 4.5% dividend."
Plus, Cramer believes that the stock is cheap, stuck as it has been near $60.
A caller wanted to know if Cramer would recommend
, which owns Mondavi vineyards.
While Cramer said she was right to make the comparison, he said that Constellation's last quarter was a "disaster," and that it made him think that the wine and beer markets were not for him.
While Cramer has said time and again to stay away from the automobile and Big Pharma sectors, it's not because he hates them per se. He said he just dislikes the U.S. automakers and drugmakers.
It's not for political reasons, he said, but because there are "much, much better opportunities for growth if we get out of the U.S.A."
A Passage to India
"If you do the E.M. Forster thing and go to India," he said to take a look at
Dr. Reddy's Laboratories
to get into both sectors.
The Indian market is exploding, a factor that makes both stocks look intriguing, he said.
As far as Dr. Reddy's in concerned, Cramer doesn't usually like generic-drug companies, but the said that the company is embarking on some growth acquisitions that could be "just what the doctor ordered."
Dr. Reddy's is doing an offering to pay for its latest acquisition, giving investors an opportunity to sneak in and buy.
But, he warned, "If you're buying
Dr. Reddy's after hours, you have no concept of what you're doing whatsoever."
He also said that if
loses its patent on Plavix, then this generic-drug play could benefit.
He said that Tata Motors is a great-looking automaker because, unlike its American counterparts, it has no labor issues or expensive pension plans with which to deal.
"is without question the best infrastructure play out there," Cramer said, because our country is switching to coal-based power.
"If you need to build a
coal plant, McDermott gets the call ... and as of the 22nd, they'll put their asbestos issues in the past," he said.
When the stock shot up to $52 a share, Cramer said he passed on it, even though he thought it was a good company, because the price was too high.
But now that it's back down near $47, he said he would back up the truck and buy.
Price, more than anything, matters a lot, Cramer said, and sitting around waiting for the right price is key.
"It's like a professional shopper waiting for the right sale," he said, adding that discipline is the name of the game and the key to making a lot of money.
When you see a stock that is unquestionably in bull market mode and it gets knocked down, that's when you "pull the trigger" and buy.
Cramer believes that the growth story behind McDermott is good because of the many coal projects that have been proposed in the U.S.
He added that their subsidiary Babcock & Wilcox practically owns the coal emission scrubber and plant boiler markets, which are necessary for clean coal plants.
With environmental rules getting tougher, Cramer said that means mad money for the McDermott unit.
Finally, the company trades at 16 times earnings, but he believes that its growth rate could justify an even higher multiple.
Cramer welcomed Patrick Sullivan, chairman and chief executive of
( CYTC), a company that specialized in the women's health care sector.
Cytyc makes products to detect cervical and breast cancer, and Sullivan said they have a large share of the pap-test market.
He also said that the company's fourth-quarter revenue increased by 25%, and that its new products should generate continued growth.
One product he seemed particularly upbeat about is a new product that will treat abnormal uterine bleeding, for which he says there will be a large market.
To view Cramer's interview with Sullivan, click here.
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At the time of publication, Cramer was long Ameritrade, Boeing and Motorola.
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