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If the proposed economic stimulus package gets approved, consumers will be spending some of their tax rebates at retailers, Cramer told viewers of his "Mad Money" TV show on Thursday.
Retail stocks trade off of their same-store sales numbers, he explained, and with the comparisons from last year so low, retailers can't help but benefit.
In this regard, Cramer likes such retailers as
( JCG) and
He notes that
( LIZ) and
should also do well.
And he's still a fan of
at these levels.
Cramer also thinks restaurant chains may benefit from the stimulus. He says
, proprietors of the Red Lobster and Olive Garden chains, should see a boost in sales.
There are also some unlikely benefactors from stimulus that investors should consider. For instance, homebuilder
will benefit from the higher conforming mortgage loan limit of $729,750 that Fannie Mae, Freddie Mac and the FHA will support under the stimulus plan. And that makes the stock now a buy, Cramer says.
He's even willing to do an about-face on
( TMA), but only recommends the F class preferred shares.
Also on the about-face list is
( BSC), which Cramer says is now too valuable to not be considered a takeover target.
In Defense of CSX's CEO
Cramer is starting his own one-man crusade to stand behind Michael Ward, CEO of
now cutting rates, railroads are the place to be, Cramer says. That's why he doesn't understand why two activist investors -- TCI and 3G -- are clamoring for Ward's removal.
"Ward's done an amazing job," Cramer pointed out. CSX is up 254% in five years, more than any other rail stock. "This man knows how to run a railroad," he noted.
Ward said he also doesn't understand the calls for his ouster. CSX, he notes, is in the top 10 of the
, has doubled its dividend and raised its buyback program. The company is also investing $1.7 billion into the business for long-term growth. Ward said he's proud of what CSX delivers to its shareholders.
Cramer reiterated his buy on CSX and encouraged its shareholders to vote in favor of Michael Ward.
"Discipline always trumps conviction," Cramer reminded viewers, as he detailed some of his trading strategies. "Buying stocks is not marrying them," he said, adding it's OK to like a stock at a certain price and not like it at a higher price.
That's the case with agriculture stocks, Cramer said. Companies like
have both rallied in recent days, and Cramer said investors need to take some profits. "You don't have a profit until you sell," Cramer stressed.
The same strategy applies to stocks like
, Cramer noted. Both stocks had huge runs and had investors taken profits on the way up, they wouldn't have been hurt by the big declines.
Cramer then revisited his "Stress Index," a list of homebuilders and mortgage lenders. The index was at 100 when he created it on Aug. 3, but fell to 47 percent two weeks ago when Cramer began recommending buying stocks on the list.
Had investors followed this strategy, he noted, investors would've benefited from the recent rally and netted a 10 percentage-point gain.
A Market for Damaged Autos
Cramer welcomed Willis Johnson, founder of auto remarketer
, to the show to discuss the company's business model.
Johnson said Copart is not a salvage company, but instead an Internet auctioneer of damaged and repossessed autos. The company takes autos that would be classified as "totaled" here in the U.S., and provides a way for them to be shipped to other parts of the world where they can be repaired for less.
Cramer said this is a company whose stock is going up, not down.
A Final Word
Finally, Cramer told viewers he still likes
. EMC is a stock he owns for his
Action Alerts PLUS portfolio.
Cramer was bullish on
Vasco Data Security
Cramer was bearish on
Melco PBL Entertainment
Las Vegas Sands
Albany Molecular Research
International Game Technology
Want more Cramer? Check out Jim's rules and commandments for investing from his latest book by
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At the time of publication, Cramer was long EMC.
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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