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Cramer's 'Mad Money' Recap: The Next Natural Gas Plays (Final)

Cramer talks about two companies that fit the profile of what Exxon Mobil was looking for when it acquired XTO Energy.
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NEW YORK (

TheStreet

) -- "It's time to ring the register and take profits in

XTO Energy

(XTO)

," Jim Cramer told the viewers of his "Mad Money" TV show Thursday.

Now that the company has accepted a takeover bid from oil giant

Exxon Mobil

(XOM) - Get Report

, Cramer said there will be little upside left in XTO, but that doesn't mean there aren't still huge gains to be had in natural gas sector.

Cramer said Exxon's acquisition of XTO makes perfect sense, since the company could theoretically sell natural gas at its fueling stations for half the price of regular unleaded gas, and still make huge profits.

So that begs the question, who will

Chevron

(CVX) - Get Report

, a stock which Cramer owns for his charitable trust,

Action Alerts PLUS, and rivals

ConocoPhillips

(COP) - Get Report

and

BP

(BP) - Get Report

, another stock he owns in his charitable trust, buy to secure their natural gas offerings?

Cramer said the answer is companies that look just like XTO. He said while their are many great natural gas stocks out there, such as

Ultra Petroleum

,

Range Resources

(RRC) - Get Report

and

Encana

(ECA) - Get Report

, none of these stocks fit the XTO mold. But

Chesapeake Energy

(CHK) - Get Report

does.

Cramer said Chesapeake fits the XTO mold. The company operates solely in the U.S., has only on-shore projects, is heavily invested in oil shale fields across the country and is among the lowest cost producers of natural gas. Cramer said with its track record of consistent production growth, Chesapeake is natural takeover target.

Cramer also gave the nod to Range Resources, saying that the company, while smaller, also has low production costs and high oil-shale exposure.

Given the great fundamentals of both these companies, Cramer said both are a buy even without a takeover bid. However, give the possibility of takeover, they look even better, he said.

Corporate Citizenship

Continuing with his "Invest In America" series, Cramer sat down with Indra Nooyi, chairman and CEO of

Pepsico

(PEP) - Get Report

, a stock which Cramer owns for his charitable trust,

Action Alerts PLUS, to discuss that company's business and various new initiatives.

Nooyi explained Pepsi's "performance with purpose" initiative, which states that companies can no longer operate profitably while throwing its costs off to society. Under the plan, Pepsi is striving for energy balance and sustainable farming, while working with lawmakers to tackle societal issues such as obesity.

Nooyi said that being a good citizen and giving back to the community is a sentiment that is resonating around the globe, and is helping Pepsi attract and keep the best and brightest employees. She said her employees not only make a living, but also have a life, while building a long-term career and personal nestegg.

When asked more about the obesity epidemic in the country, Nooyi said that obesity is a societal problem, and doesn't happen because of a single food. She said she's proud of the company's portfolio of ever healthier products.

Cramer asked her about the company's recent decision to not advertise in the upcoming Super Bowl. Nooyi clarified by saying that Pepsico, the company, will be advertising at the big game, both with its Gatorade and Doritos brands. Pepsi, the soft drink, however, will not be advertising, said Nooyi, adding the brand will be focused on community-based efforts.

When asked about the company's association to golfer Tiger Woods, who's come under fire as of late, Nooyi retorted that "Tiger is a great golfer," and left it at that. She said that Gatorade is endorsed by all of he best athletes and the company is not focused on any one in particular.

Turning back to the company's business, Nooyi said she has no regrets about spinning off

Yum! Brands

(YUM) - Get Report

, or its bottlers, saying that it made sense, at the time, to spin off those assets. Today, however, Nooyi noted that the dramatic changes in the marketplace has spurred Pepsico's efforts to buy back its bottling units.

Finally, when asked about the new generation, and whether social media helps sell soda, Nooyi said that when used right, new media works great. But, she noted, it also spreads like wildfire if a company does something wrong.

Mad Mail

In a "Mad Mail" segment that turned into his "Outrage Of The Day," Cramer told a viewer that he's appalled that the U.S. government didn't sell its stake in

TheStreet Recommends

Citigroup

(C) - Get Report

at $5 a share, when he advised viewers that they too should sell. He said the government made a cardinal sin, turning a trading gain into an investment loss.

Cramer said the government has no business playing in the stock market and should've taken its gain in the stock as a win for the American taxpayer. Instead, it squandered the gain, a move Cramer called "shameless." Cramer said the government owes the American people an apology, for not following one of the cardinal rules mentioned in his book,

Real Money

.

Lightning Round

Cramer was bullish on

Macy's

(M) - Get Report

,

Urban Outfitters

(URBN) - Get Report

,

Foster Wheeler

,

Fluor

(FLR) - Get Report

,

Triquint Semiconductor

(TQNT)

,

Skyworks Solutions

(SWKS) - Get Report

,

Apple

(AAPL) - Get Report

,

Allegheny Technologies

(ATI) - Get Report

and

Hexcel

(HXL) - Get Report

.

He was bearish on

Buckle

(BKE) - Get Report

,

Chicago Bridge & Iron

(CBI)

and

NYSE Euronext

(NYX)

.

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

To watch replays of Cramer's video segments, visit the Mad Moneypage on CNBC

.

Want more Cramer? Check out Jim's rules and commandments forinvesting from his latest book by

clicking here.

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

.

At the time of publication, Cramer was long Chevron, BP,. Pepisco.

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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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 TheStreet.com. 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 TheStreet.com, 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.