'RealMoney' Radio Recap: Nokia Know-How

Cramer says the success of the cell phone company makes its chip supplier a good play.
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"One of the methods that I suggest to you as you look for investments is ... you gotta look into your medicine chest, your kitchen shelves ... look at what people are doing all around you," said Jim Cramer on his

"RealMoney" radio show Monday.

Among these everyday, money-making ideas, he said to take a closer look at cell phones, a place where

Nokia

(NOK) - Get Report

is the dominant player.

Motorola

(MOT)

didn't make its quarter, he said, and its Razr is getting beaten out by other phones.

Not only did Nokia see its earnings greatly rise last in the last quarter, but also the company said it is increasing its market share, Cramer added.

But Nokia has already made its move, and Cramer said it will take a lot of news to get that company moving again. If you open up a Nokia phone, there are a lot of chips inside, and Cramer said that they are made by

Power Integrations

(POWI) - Get Report

.

He said that the spring build for Nokia phones will contain more Power Integrations' chips than any other company's. With the stock down five points, Cramer said that this is the play on the success of Nokia.

Cramer told a caller that he has been a huge supporter of

Marvell Tech

(MRVL) - Get Report

because it is one of many companies making chips for the trend toward "convergence."

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This refers to the fact that consumers no longer want PCs. They want devices a bit larger than cell phones that have PC functions and the ability to play music, or they want video-game devices.

Marvell is the only company with exposure to both of these streams, Cramer said.

He said that a lot of selling going on in Marvell is investors bailing because its rival

Broadcom

(BRCM)

disappointed Wall Street.

This is a big mistake, Cramer said, adding that he still likes Marvell.

Just as a leopard can't change its spots, Cramer said that

Intel

(INTC) - Get Report

can't change its inefficient corporate structure.

Cramer said that despite a recent "rosy"

New York Times

article about Intel and the fact that it has about 90% of the market share for office computers, the stock has not bottomed.

Even though the company is issuing new chips, it has to move its inventory of old chips. That could mean that Intel sells them for cheap, which would weigh on the entire semiconductor industry, he said.

Cramer likes

Advanced Micro Devices

(AMD) - Get Report

instead, which reported a good quarter.

Plus, AMD is a company now run by engineers, whereas it was once run by salespeople. During this management changeover, the company began to gain market share. Intel took the opposite route, Cramer said.

The company was founded by engineers and scientists who "outmanufactured and outengineered the other guys." Now it is run by a sales guy, and the company is slipping, he said.

But as much as he likes AMD, Cramer said that the ripple effect from Intel leads him to believe that AMD will not move higher in the near future.

Sector Sense

A caller wanted to know if Cramer still likes his basket of optical stocks, including

Finisar

(FNSR) - Get Report

, now that many of them have fallen.

Cramer said that in six to 18 months they will be much higher, but that in six to 18 days he isn't sure what will happen.

The turn is at hand, he said, counseling that the caller have patience for this multiyear story. But, he said that he wouldn't do anything until after these plays report earnings.

Cramer said that one would think $3-a-gallon gas, and about $60 to fill a tank, would kill the economy by putting the freeze on retail, autos and housing. But the

Dow

is still advancing.

The market is not freaking because the sectors that are booming are not levered to U.S. consumer spending, he said.

It's overseas markets and federal government spending that are keeping the markets going, he said, as they pour money into sectors like industrial, military and aerospace.

Companies in these sectors are hitting 52-week highs, unlike consumer stocks that include

Wal-Mart

(WMT) - Get Report

,

Ford

(F) - Get Report

and

Kohl's

(KSS) - Get Report

.

Defense is going higher because we've got a war in Iraq and a standoff with Iran, Cramer said. In this space, he likes

General Dynamics

(GD) - Get Report

, which has also profited from an increase in corporate spending on jets.

He also said he would take a look at

L-3 Communications

(LLL) - Get Report

and

Lockheed Martin

(LMT) - Get Report

.

In infrastructure, Cramer said that

Caterpillar

(CAT) - Get Report

is the stock to watch. It's a U.S. company, but its great quarter was all thanks to booming business in Brazil, Russia, India and China.

Cramer said that the railroad sector is on fire and that

CSX

(CSX) - Get Report

has had some of the best earnings he has seen from this slew of quarterly reports.

Railroads are making money as they take things from the heartland to the coasts to send to China, he said. He added that

Norfolk Southern

(NSC) - Get Report

,

Union Pacific

(UNP) - Get Report

and

Burlington Northern

(BNI)

are also benefiting from this trend.

Cramer believes that aerospace is hot because the only way for the airlines to maintain profitability is to upgrade to faster, cheaper and lighter planes.

Boeing

(BA) - Get Report

is the whale of a stock, while the minnow is

BE Aerospace

(BEAV)

, which makes the seats for the cabins. BE Aerospace is at a 52-week high today, he added.

He also likes

Aviall

(AVL)

, which performs engine overhaul, and

AAR

(AIR) - Get Report

, which refurbishes landing gear.

Finally, he said that not even governments that generally favor industry over the environment will allow plants to burn coal without following some environmental regulations.

The plays on this trend are

McDermott

(MDR) - Get Report

,

Fluor

(FLR) - Get Report

and

Foster Wheeler

(FWLT)

, he said. Cramer owns Foster Wheeler for his

ActionAlerts PLUS charitable trust portfolio.

He said that these companies will get the contracts to rebuild plants so that companies will not run afoul of environmental laws.

Even though Cramer likes

Allegheny Technologies

(ATI) - Get Report

, the stock has doubled in four months and said that it is time to "ring the register."

"You could get slaughtered" and these levels, he told a caller. He added that with such a huge run, there is little that the company could say during its earnings report that would push the stock higher.

Similarly, he said that

Evergreen Solar

(ESLR)

has moved too much to be a buy. It was at $5 a year ago and is now at $15.

People have started to take profits, Cramer said. He would wait until it hit $12 before going back in.

He told a caller that it has always been difficult for him to make a call on

Celgene

(CELG) - Get Report

, in part because his daughter is on the same sports team as the daughter of Celgene's senior vice president and chief financial officer.

He likes the company because it has a hammerlock on a drug that works against blood cancer and that it has cornered that market.

However, the stock is up $1.50 today, and Cramer said that now would be a good time to get out because the stock may be getting ahead of itself.

He said that he has been buying

Cephalon

(CEPH)

for his charitable trust because he believes that it has a brighter future than Celgene.

He also said that he likes

International Securities Exchange

(ISE)

because it is a fully electronic exchange for options trading.

Options trading it big right now, he said, and is the reason why he has recommended in the past stocks including

optionsXpress Holdings

(OXPS)

,

GFI Group

(GFIG)

,

Chicago Mercantile Exchange

(CME) - Get Report

and

CBOT Holdings

(BOT)

.

At the time of publication, Cramer was long Cephalon and Foster Wheeler.

James J. Cramer is a director and co-founder of TheStreet.com. He contributes daily market commentary for TheStreet.com's sites and serves as an adviser to the company's CEO. Outside contributing columnists for TheStreet.com and RealMoney.com, including Cramer, may, from time to time, write about stocks in which they have a position. In such cases, appropriate disclosure is made. To see his personal portfolio and find out what trades Cramer will make before he makes them, sign up for

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