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) -- "The market is not, and cannot be, expensive based on the earnings we've seen," Jim Cramer told the viewers of his

"Mad Money"

TV show Monday, as he declared that the entire market is just too cheap given the fabulous earnings American CEOs are delivering.

Cramer said there are a million bear cases for why stocks should be headed lower, but valuation just isn't one of them. He said that strong earnings reports, especially ones where companies beat expectations and raise guidance, are the building blocks of a bull market, and that's exactly what we've seen.

Just about every sector in the

S&P 500

is participating, said Cramer. In health care, an industry supposedly crushed by reforms, Cramer said companies universally trumped the estimates, including

UnitedHealth Group

(UNH) - Get UnitedHealth Group Incorporated Report


Eli Lilly

(LLY) - Get Eli Lilly and Company Report


TheStreet Recommends

Johnson & Johnson

(JNJ) - Get Johnson & Johnson Report


Technology, led by


(AAPL) - Get Apple Inc. Report

, a stock which Cramer owns for his charitable trust,

Action Alerts PLUS and


(GOOG) - Get Alphabet Inc. Class C Report

, along with scores of others, surged past the estimates. Oil stocks benefitted from oil about $80 a barrel.

Even the banks, which were also forecast to disappoint, raised guidance, as evidence by

Wells Fargo

(WFC) - Get Wells Fargo & Company Report


U.S. Bancorp

(USB) - Get U.S. Bancorp Report

. Only

Bank of America

(BAC) - Get Bank of America Corp Report

, another Action Alerts PLUS name, and

Morgan Stanley

(MS) - Get Morgan Stanley Report

fell short of expectations.

And the list goes on, said Cramer, from restaurants and retail, to the transports, telco, chemicals, aerospace and industrials. Even the airline stocks were able to squeak past the forecasts, he noted. "We're forging a new consensus for 2011," said Cramer, and that will affect the entire market.

Firing on All Cylinders

In an exclusive "Executive Decision" segment, Cramer spoke with John Killian, retiring CFO of


(VZ) - Get Verizon Communications Inc. Report

, which Cramer has championed on "Mad Money," and one that's up 27.5%, including dividends, since Cramer's last recommendation on Oct. 29, 2008.

Killian said Verizon is firing on all cylinders, making it a tough time to leave the company. He said the company is in a great position with the assets it has, and Verizon will be focusing more and more on wireless and data, with an emphasis on network quality.

When asked for more details on Verizon's wireless business, Killian said only 23% of subscribers currently use a smartphone, making a huge opportunity for increased wireless data usage. While some have forecast a peak in mobile messaging, Killian said Verizon does not expect that to happen any time soon.

Other bright spots for the company included Verizon's FiOS Internet and cable TV service, along with



(AAPL) - Get Apple Inc. Report

iPad, which Killian said is a great fit with the company's current lineup of products.

Finally, when asked about Verizon's dividend, Killian said the company calculates its dividend based on its cash flow from operations, and he's very comfortable with the level given free cash was up 25% year over year. That's why Verizon just raised its dividend 2.6%.

Netflix's for Real

What makes a stock rally 75% in just three months? Cramer said "growth," along with a tectonic shift in how Americans watch TV. He said that's why


(NFLX) - Get Netflix, Inc. Report

, a stock he recommended on July 26, was able to power 62% higher, and why that's only the beginning.

Cramer made it clear that the short sellers, along with just about every Wall Street analyst who covers the company, just doesn't "get it." He said that Netflix is now the king of streaming video, and while Wall Street might not understand what that means, the younger generation does.

Cramer said Netflix is now available on over 100 different devices, including the new Apple TV. The company has even officially changed its mission in a recent press release to define itself as a streaming video company that also offers DVDs by mail.

With subscriber growth up an astonishing 52% year over year, and 13% from just last quarter, Cramer said the potential for Netflix is huge. Couple that with the fact that subscriber acquisition costs were lower, and Cramer said it's clear Netflix is benefiting from more than just the demise of brick-and-mortar video chains.

Netflix trades at 44 times earnings, but has a 30% growth rate, said Cramer. And while some are worried about competition and a decline in DVD rentals, Cramer said streaming is where it's at, and the estimates for Netflix are still way too low.

Black Box Needed

Cramer once again welcomed the outgoing Senator Ted Kaufman (D, Del.) to to discuss the state of financial reforms in this country.

Kaufman said the biggest obstacle to reforms is time. He said the Securities and Exchange Commission took three months just to gather the data from the so-called "flash crash" and even still we don't really know what happened. Kaufman said the markets need a black box, like aircrafts use, so that data can be monitored continuously and not just after something bad happens.

Kaufman said the flash crash was a result of a perfect storm of events, where a lot of money met a lot of change in a place with neither transparency nor regulation. He said with 70% of all market trading now done by computers, it's harder and harder to know what's going on.

Kaufman said that democracy and capital markets are what makes America great, and he wishes that everyone on Wall street would pitch in to help with reforms before America's markets become second rate behind Hong Kong, Singapore, Frankfort and London, all of which don't seem to have the high-frequency trading issues that American markets do.

Lightning Round

Cramer was bullish on

Huntington Bancshares

(HBAN) - Get Huntington Bancshares Incorporated Report



(EXC) - Get Exelon Corporation Report



(FE) - Get FirstEnergy Corp. Report


Progress Energy




(SLB) - Get Schlumberger NV Report


Weatherford International

(WFT) - Get Weatherford International plc Report


J Crew

( JCG).

He was bearish on


(GLW) - Get Corning Inc Report


Allegheny Energy

( AYE)and


(RIG) - Get Transocean Ltd. Report


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

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Scott Rutt.

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clicking here.

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


At the time of publication, Cramer was long Apple.

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.