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"Healthcare stocks have nothing to fear," Jim Cramer told viewers of his "Mad Money" TV show Thursday.

He reiterated his belief that the healthcare sector is the place to be given the current market conditions. He expects big money managers to flock to the historically recession-proof stocks and advised investors to get in ahead of the rotation.

Cramer recommended Hospira ( HSP) as his next investment idea in the group. Hospira, he said, is transforming itself from a boring drug delivery and medication management company into a faster growing, higher-margin oncology powerhouse.

Hospira was spun off by Abbott Labs ( ABT) back in 2004, and after a rocky start, Cramer said, the company is finally starting to gain some traction. The company has met or beat earnings expectations for the past seven quarters in a row, giving it a solid track record of results, he said.

Hospira is currently the No. 1 maker of specialty injectable pharmaceuticals, with 17% market share in the U.S. The company also has real potential for growth in Japan, where generic drug use by the government-run healthcare system accounts for only 16% of all drugs used, compared to 50% in the U.S.

Cramer is especially high on Hospira's injectable oncology division, after the company's purchase of Mayne Pharmaceuticals in February, 2006. This business, he said, provides Hospira growth that Wall Street has failed to notice.

Cramer: The Tide's Turned for Drug Stocks

Cramer also liked the fact Hospira is cutting costs. The company closed five facilities, which should add 9 cents a share to the company's 2010 earnings. It has also increased its operating margins, from 14.9% in 2004, to just over 16.9% today, with the goal of reaching 19.9%.

"I think Hospira has what we want from the healthcare stock," said Cramer.

Getting Back In

"I think the moment's right to start buying natural gas," Cramer told viewers. After warning that the sector would be hit and hit big last Wednesday, Cramer said it's finally time to get back into the natural gas stocks.

Cramer said he's still a fan of Chesapeake Energy ( CHK), but not for the reasons viewers might think. Last night, Chesapeake completed a secondary offering of 25 million shares at $57.25 a share. Today the stock closed at $61.58 a share for a 6.7% gain in just a single day. "That's the all-clear signal we've been waiting for," said Cramer.

He said that secondary share offerings normally are bad for current shareholders and dilute value. However, that's not the case with Chesapeake because the company plans to use the money to increase drilling, a move that's seen as wildly bullish for the stock, he said.


Cramer cited five of Chesapeake's previous secondary offerings, noting that all five have made money in the past. The company issued shares on March 27, 2008 at 26% below the current share price; on Sept. 26, 2007 at 48% below the current price; on June 27, 2006, at 53% below the current price; on Sept. 8, 2005, at 47% below the current price and on Sept. 9, 2005, at 76% below the current price.

Cramer also voiced his support for Chesapeake CEO Aubrey McClendon, whom he said is the most bankable CEO in America.

HMO Woes

In the "Sell Block" segment, Cramer gave viewers a list of stocks which he said are the real losers of the new Medicare spending bill that Congress just passed Wednesday. According to Cramer, the managed care providers will be hardest hit by the new $12.5 billion spending package.

Cramer told viewers to "stay the heck away from the managed care companies." He said that Healthspring ( HS), which gets 88% of its revenues from Medicare, will be hardest hit by the new plan.

Also on the list are Humana ( HUM), Coventry ( CVH), HealthNet ( HNT) and Triple-S ( GTS), all of which have Medicare exposure.

Cramer also added former favorite United Healthcare ( UNH), which only has 12% exposure to Medicare, to the list, calling the company "a serial destroyer of wealth."

Cramer said managed care companies are also poised to be hit by the shrinking economy. "When unemployment rises, membership in HMO goes down," he said. With these companies getting hit from both ends, Cramer said they just can't be owned.

Wachovia's New CEO

Cramer had high praise for Treasury Under-Secretary Bob Steel, who resigned his position to head the ailing Wachovia Bank ( WB).

He called Steel "one of the great behind the scenes player" and one of the integral players behind the recent JP Morgan Chase ( JPM) and Bear Stearns ( BSC) merger.

Cramer said the turn-around of Wachovia will take time, and he's still would not be a buyer of the bank at this time.

Sudden Death

Cramer was bullish on Clean Harbors ( CLHB), Spectra Energy ( SE)and Johnson & Johnson ( JNJ).

He was bearish on CVRD ( RIO).

Lightning Round

Cramer was bullish on Agnico-Eagle Mines ( AEM), Eaton ( ETN), Oilsands Quest ( BQI), Ferrellgas Partners ( FGP), Nike ( NKE), Motorola ( MOT)and Compagnie Generale de Gophysique ( CGV).

Cramer was bearish on Stillwater Mining ( SWC), Under Armour ( UA), ( CRM), United Parcel Service ( UPS), Fedex Corp (Federal Express) ( FDX)and Rambus ( RMBS).

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For more of Cramer's insights during the Lightning Round, click here .

At the time of publication, Cramer was not long on any stock.

Jim Cramer, host of the CNBC television program "Mad Money," is a Markets Commentator for, Inc., and CNBC, and a director and co-founder of All opinions expressed by Mr. Cramer on "Mad Money" are his own and do not reflect the opinions of 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, 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 is related to the specific opinions expressed by him on "Mad Money."

None of the information contained in "Mad Money" constitutes a recommendation by Mr. Cramer, or CNBC that any particular security, portfolio of securities, transaction, or investment strategy is suitable for any specific person. You must make your own independent decisions regarding any security, portfolio of securities, transaction, or investment strategy mentioned on the program. Mr. Cramer's past results are not necessarily indicative of future performance. Neither Mr. Cramer, nor, nor CNBC guarantees any specific outcome or profit, and you should be aware of the real risk of loss in following any strategy or investments discussed on the program. The strategy or investments discussed may fluctuate in price or value and you may get back less than you invested. Before acting on any information contained in the program, you should consider whether it is suitable for your particular circumstances and strongly consider seeking advice from your own financial or investment adviser.

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 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, 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.

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