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NEW YORK (
) -- "You need to take advantage of the down days," were Jim Cramer's words of wisdom to the viewers of his "Mad Money" TV show Thursday.
He said that when markets are mixed, investors need to seek out the bull markets and take advantage of the opportunities as they unfold.
Cramer said the market's attitude that everything is horrible one day and fabulous the next is flawed. He said the truth is that the markets are mixed, a word rarely spoken on Wall Street. But while the masses may be running away from the markets, Cramer said businesses are seeing value, which is leading to the increase in mergers and acquisitions.
Case in point,
, a stock which Cramer owns for his charitable trust,
Action Alerts PLUS. Intel saw value in security giant
( MFE), which is why the company was willing to offer a 60% premium to the stock price.
New Alliance Bancshares
( NAL) saw value in
First Niagara Financial
when it decided to merge, as did
Cramer said in this market investors need to anticipate these mergers, and take full advantage of the down days and the value they create. The bull markets are out there, he concluded.
In the Thursday "Sell Block" segment, Cramer pardoned two stocks that he said have been wrongfully imprisoned by the markets, LED lighting makers
Cramer said these companies are profoundly misunderstood. In the case of Cree, Cramer said the stock is being held hostage to waning LED backlighting sales for TVs and monitors, despite the fact that backlighting only represents 20% of Cree's sales. What Cree should be levered to, said Cramer, is general LED lighting, which now makes up 50% of Cree's business, and has a strong long-term thesis.
Cramer said Cree is far too cheap, trading at just 17 times earnings, despite a 27% long term growth rate and $9 a share in cash.
In the case of Rubicon, Cramer said the company is down 11 points from its July highs, despite posting a strong quarter on Aug. 5. Rubicon is the only pure play on sapphire wafers, the raw material used for almost all LED lighting chips. The company commands 23% of the wafer market, he said.
Like Cree, Rubicon is selling at a deep discount, trading at just 14 times earnings, despite a 29% long term growth rate. Cramer said the sellers of Rubicon are making a mistake, and the LED industry will only need more and more wafers as new energy efficiency standards roll in between 2012 and 2014.
Latest Bull Market
Looking for the latest undiscovered bull market? Cramer said he's found it in fashion accessories.
Cramer said it took a little digging, but after listening to a few conference calls, the surge in fashion accessories became apparent. He said it started with
, which noted strong accessory sales in its July numbers. Then
reported that its purses and wallets were flying off the shelves. Finally, Cramer said the trend was confirmed by
, which also noted that accessories were all the rage.
Of the many ways to get into the accessory market, Cramer said he likes
, the company best known for its watches, but one that also makes sunglasses, handbags and other accessories.
Fossil reported a blowout quarter on Aug. 2, its second consecutive great number. The company delivered a 24-cents-a-share earnings beat on sales that were up 31%. Fossil also reported stronger-than-expected margins thanks to its ability to raise prices on its merchandise.
Cramer said Fossil is a growth story. The company has 201 stores in the U.S., and more abroad, and after a multi-year hiatus on building new stores, Fossil is starting to expand again. Shares of Fossil trade at just 13 times earnings while the company is growing at an accelerating 17%.
Cramer said he likes Fossil as a way to play accessory sales, but would also recommend Urban Outfitters and Coach.
Acne Treatment Play
In the "Executive Decision" segment, Cramer spoke with Jonah Shacknai, chairman and CEO of
, a company that's just one point off its 52-week high.
Shacknai said Medicis has been a leader in the treatment of acne for 15 years, but its newest product, Solodyn, has finally hit a sweet spot, providing effective relief and reduced side effects. He said the strong growth in Solodyn is evidence that people are discovering that the product works.
When asked about the larger outlook for the company, Shacknai said consumers are beginning to feel better and aren't as worried that things will be getting worse economically, so they're beginning to return to Medicis' products. Shacknai remains cautiously optimistic.
Shacknai also highlighted Liposonix, a fat removal system to treat obesity. He said he hopes the Food and Drug Administration will approve the treatment soon here in the U.S.
Cramer said he remains a fan of rival
, on the strength of their Botox product, but also feels that Medicis has a strong business. He said Liposonix will be huge for the company when its approved and he'd be a buyer of the stock.
Cramer was bullish on
Starwood Hotels & Resorts
He was bearish on
Hartford Financial Services
-- Written by Scott Rutt in Washington D.C.
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At the time of publication, Cramer was long Intel.
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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