RealMoney Radio Recap: Devon Heaven

Devon Energy ( DVN) is the cheapest independent oil and gas company, Jim Cramer said on his "RealMoney" radio show Thursday, and it reminds him of Kerr-McGee ( KMG), since it has oil in a lot of safe places.

Not only is Devon Energy tremendous at finding oil, it also has a great record of replenishing oil, he said. At $61, Cramer believes the stock could easily go up 30 to 40 points if it receives a single takeover bid. And a bid is possible, he said.

The bottom line is that Devon Energy should not be this low, especially since oil is $75 a barrel, he said. If oil goes to $65 a barrel, Cramer predicts Devon Energy could fall five points, but not much more, and if oil stays where it is, he believes the company could get taken over.

He called Devon's fundamentals better than good and said it is a buy.

Although J.C. Penney ( JCP) reported "beautiful" numbers this morning and

Abercrombie & Fitch ( ANF) reported an awful number, J.C. Penney is down, while Abercrombie & Fitch is up.

This is because a lot of people know J.C. Penney is a well-run place and Abercrombie & Fitch is a disappointment, Cramer said. It's all about expectations, he said. And the expectations got out of control for the upside of J.C. Penny and for the downside of Abercrombie & Fitch.

Altria's Split Personality

Altria ( MO) is a stock in the news that Cramer believes people should buy.

The lawsuits currently surrounding Altria, which Cramer owns for his charitable trust, Action Alerts PLUS, are "a joke" and are all going away, he said.

And when it wins those lawsuits, Cramer believes Altria is going to split into three companies: domestic tobacco, international tobacco and Kraft Foods. Once it is split up, Altria will be worth $100, he said. (The stock was recently at $77.)

Cramer said he is always asked about Sirius Satellite Radio ( SIRI), a company that always delivers its numbers, when it doesn't beat them.

But people are not going to make money with Sirius unless it merges with rival XM Satellite Radio ( XMSR), he said.

As XM Radio continues to perform badly and Sirius Satellite does well, Sirius will be able to buy XM Radio, he said. For now, he recommended holding Sirius, but not buying any more, unless the stock goes under $4, in which case he advised buying. (Sirius was recently at $4.56.)

Target Toyota

Toyota ( TM) is one incredibly cheap stock and abandoning it would be a mistake, Cramer told a caller.

The automaker needs a strong dollar, and it was hurt by the fact that Japan has been raising its interest rates, but Cramer said he would not sell it. He said if it went below $100, he would buy it "hand over fist." (Toyota was recently at $103.28.)

Cramer told another caller that natural gas and oil do not trade together. While oil is at an all-time high, natural gas is at a multiyear low, he said. This is because there is too much natural gas right now; however, if there is a hurricane, Cramer believes the price of natural gas will spike up.

If people believe there is going to be a vicious hurricane season, then they want to be in Southwestern Energy ( SWN), he said, adding that the stock has dropped to $30 and the company has a major position in Texas' Barnett Shale, perhaps the country's largest natural gas field.

When a caller inquired about whether Apple ( AAPL) has bottomed out or not, Cramer said that while the stock is down 30 straight points from January, it is still up 50% from where it was a year ago.

Cramer believes Apple will be coming out with a lot of new products for Christmas. Also, since Vista is late for Microsoft ( MSFT), which he owns for his charitable trust, Action Alerts PLUS, he said he believes Apple will have leg up in the back-to-school and Christmas season.

Cramer advised the caller to wait for Apple to report its quarter before buying the company's stock. He said to wait and buy later for a strong second half of the year.

Dow Chemical ( DOW) is a stock Cramer believed would go up, he said.

Since last year, natural gas prices have been cut by two thirds, so Cramer thought the raw costs for Dow Chemical would go up. However, as it turns out, business has not been great for Dow Chemical.

Cramer said the stock is still cheap and he wouldn't flee; however, he wants his listeners to understand that until the housing market goes up, Dow Chemical is stuck in the mud

When a caller asked about TD Ameritrade ( AMTD), which Cramer owns for his charitable trust, Action Alerts PLUS, he said he is worried about it.

Although the downside is somewhat minimal, he said it has been a disappointment and that he is waiting for it to go higher so he can lighten up on it.

eBay ( EBAY) is a company that has overpromised and underdelivered, and Cramer said he does not believe its stock is going up. He said it does not have a good risk/reward and recommended staying away from it.

Applebee's ( APPB) has had a series of very disappointing numbers, and the restaurant chain is not as good as it used to be, Cramer told a caller.

Even though the company's sales numbers are mediocre, he said with the right management he believes the company could turn those numbers around.

Here's your chance to pick the stock you'd like me to feature on my radio show July 13:
Analogic
Caterpillar
DJ Orthopedics
Freeport McMoRan
General Dynamics
Home Depot

REMEMBER to listen in on Thursday for my take on the stock that wins this poll!

At the time of publication, Cramer was long Altria, TD Ameritrade and Microsoft.

Jim 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 Action Alerts PLUS. Listen to Cramer's RealMoney Radio show on your computer; just click here. Watch Cramer on "Mad Money" at 6 p.m. ET weeknights on CNBC. Click here to order Cramer's latest book, "Real Money: Sane Investing in an Insane World," click here to get his second book, "You Got Screwed!" and click here to order Cramer's autobiography, "Confessions of a Street Addict." While he cannot provide personalized investment advice or recommendations, he invites you to send comments on his column by clicking here.

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