, all of these stocks have just been hammered.
Yet, all of them have big cash flow, great balance sheets and ample opportunity to work their way back up -- especially if the dollar would stop appreciating.
Johnson & Johnson's
a smart financial company. It is making a terrific statement -- or so it would seem -- with this
buy. More important, this is an important sign that the listed stocks, the big behemoths, think the stocks in their cohorts have come down enough to do deals.
If we are to get this rally to continue, you have to have more Alza-JNJ combos. I think that it is entirely possible because these companies can make synergies happen and have every desire to wring out profitability regardless of the economic environment.
Traditionally, you don't want to own drug stocks at this point in the cycle. They are too "defensive." But as this money pours out of tech funds, the "sisters of growth," mostly the drug stocks, have been drubbed, too. This JNJ-Alza combination is exactly the antidote that traditional nontech growth stocks can deliver to those mutual funds that would sell their stocks rather than selling
It is why you have to
the nontech stocks that get sold by these bleeding mutual funds, even as you pare back from the tech that has no traction. It is also why you have to sell the "pseudo-growth funds" that are really tech funds with a couple of drug stocks thrown in.
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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. While he cannot provide personalized investment advice or recommendations, he invites you to send comments on his column to