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NEW YORK (
) -- Investors need to pay attention to individual companies for the most accurate read on how the economy is really faring, Jim Cramer told the viewers of his "Mad Money" TV show Friday.
Cramer then mentioned which stocks he'll be watching next week. He said the most pivotal stock reporting next week is BlackBerry maker
Research In Motion
When the company reports on Thursday, it will give us the latest read on the mobile Internet tsunami, said Cramer. But with RIM already up 20% in 20 days, he said he's staying away from the stock and will just use it as a gauge for the rest of the sector.
He said drugstore-chain giant
is being used as a play on the upcoming flu season, but with the company running a distant third behind rivals
, he would use strength in RiteAid to buy the other two.
For a read on the broader markets, Cramer's looking to
. If these historically defensive names rise on their earnings, he'd begin scaling out of more cyclical stocks.
Other notable names reporting next week include
, which should provide a glimpse into the health of the aerospace sector,
, which will tell investors whether to double down on
, and finally
, which will provide insight into the state of hiring in the U.S., he said.
All of these companies, along with
Bed Bath and Beyond
in retail, can tell investors what's really going on, said Cramer, if they're smart enough to listen.
Healthy Food, Please
( KFT): "People want healthy food, not candy!"
Those were Cramer's words to the company's management. He said Kraft needs to abandon its takeover of
( CBY), and instead go where the growth is, and that's
Cramer said his logic is simple. What matters most in the food business is shelf space. The more shelf space your products have in the supermarket, the more money you make, he said. That's why a trip to his local grocery store proved his thesis.
Cadbury products consumed only two feet of shelf space, while the natural food products of Hain had 52 feet of space. At
( WFMI), a chain which prides itself on healthier choices, Hain Foods commands 220 feet, said Cramer.
But what of the fundamentals? Cramer said Hain Foods shines there as well. He said the company is focused on growing the number of stores that carries its products and the number of products it manufactures.
Cramer said Kraft is using outmoded thinking and should be focused on Hain. He said the stock of Hain could double on its own merits, and as a takeover target, could fetch at least $26 a share.
For "Speculation Friday," Cramer featured the one stock in mobile Internet index that has been flat since he created it on Aug 11. He said that telco equipment maker
( TKLC), may be lagging the market, but it's not dead money.
Cramer said the problem with Tekelec has been its most recent earnings. While the company beat expectations, it reported only inline guidance, along with news that India's implementation of local number portability has been delayed. Cramer said after a huge run from $11 to $19 a share, investors took profits in Tekelec after the news and have not looked back.
But that's a mistake, according to Cramer because Tekelec's fundamentals are still strong. The company makes equipment for text-message processing, a huge and growing business, and equipment for local number portability. He said number portability is still a go in India and that it was merely delayed until year's end. International growth will be huge for Tekelec, he said, as 12 other countries are expected to roll out number portability in the next two years.
Cramer said this $16 stock has $4 a share in cash. Even with modest multiples, its worth $21 a share, but with premium multiples, the company could fetch $27 a share.
Outrage of the Day
Cramer sounded off against the
Securities and Exchange Commission's
proposed banning of "flash trading." He said he's beside himself that the SEC can move so quickly on such an insignificant issue, while the big issues that cost investors billions go unchecked.
Cramer said it's clear that the SEC had no understanding of how Bernie Madoff was making his money, nor any understanding of how ultra-leveraged ETFs are destroying the financial stocks.
He said its apparently OK that no one enforces naked shorting, and that safeguards like the uptick rule can be repealed. It also seems acceptable, he said, that
Bank Of America
gets fined a paltry $33 million for hiding $3.6 billion in bonuses from shareholders.
Even more egregious, that fine was paid by the shareholders that got hurt in the first place, rather than the executives responsible for the wrongdoing, he said.
"Good work SEC," said Cramer. "Thanks for protecting us from flash trading."
Cramer was bullish on
He was bearish on
( CRA) and
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At the time of publication, Cramer was not long any stock mentioned.
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."
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