Cramer's 'Mad Money' Recap: Layoffs and Profits (Final)

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NEW YORK ( TheStreet) -- "When it comes to the stock market, joblessness in the U.S. isn't a bad thing," Jim Cramer told the viewers of his "Mad Money" TV show Monday. "In fact," he continued, "it's been a positive thing for countless companies that have laid off workers and are profiting as a result."

Cramer said there will continue to be layoffs and double-digit unemployment in the U.S. for quite some time, but that doesn't mean that companies won't make money or that stocks won't head higher. He said the sad reality is that there's an inverse relationship between employment and profits.

Take United Parcel Service ( UPS), a stock which he owns for his charitable trust, Action Alerts PLUS . Cramer said the stock has rallied for two consecutive days since it announced that it's laying off 1,800 workers.

Likewise with Caterpillar ( CAT), said Cramer. "There are no roads or buildings being built here in the U.S.," he noted, but there are overseas, and that's where Caterpillar is both hiring and profiting.

Cramer said we all want better news on the employment front, and we all want more jobs, and better jobs, to be created right here at home. But, he said, as investors it's important to set aside political views and look at companies and stocks only through the eyes of shareholders. As shareholders, it pays to fire, not to hire.

"This isn't profitless prosperity," concluded Cramer, "it's profits without prosperity." Cramer said on his show, he's only focused on profits, and that's why he remains bullish on any company that's divorced itself from the ailing U.S., and is making money in the global recovery instead.

Electronic Health Care Record Boom

In the "Executive Decision" segment, Cramer spoke with Glen Tullman, CEO of Allscripts-Misys Healthcare ( MDRX), a stock Cramer has remained bullish on, despite health care reforms in Washington.

Tullman declared 2010 to be the "year of the electronic health record," saying that this will be the year a large percentage of doctors and health care providers finally adopt the technology. He noted that sales are up 30% year over year, and most of the federal stimulus package has not hit the sector yet.

Tullman explained that Allscripts has $40 billion to help their clients migrate to electronic records, which can cost as much as $44,000 per physician. Yet despite the costs, Tullman said Allscripts is making it easy for doctors by making their software easier to install, guaranteeing it meets all federal guidelines, and offering flexible payment terms.

Tullman also noted that his company has great partners, with hospitals and larger providers referring their affiliated doctors to the company. He said the company's true promise of connecting disparate systems so that patients can avoid filling out forms with the same information over and over again will come to fruition as momentum grows.

Cramer said the Allscripts story remains "a good one," and said that with the stock down in recent days, he'd pull the trigger.

Under the Hood

Cramer went under the hood of the auto industry to find the best auto part stocks for investors' portfolios. He said this sector's time has finally come, as the auto sector has come roaring back to life thanks to turnarounds at Ford ( F) and others.

But Cramer said there's more to the sector that increasing auto sales. He said that many money mangers are underweight the sector, meaning that if they want their funds to beat the S&P 500 this year, they need to load up big on the group, and soon.

Given these two bullish trends, Cramer recommended Johnson Controls ( JCI), as the "best of breed" in the sector. He said this company is the cheapest, most consistent earner in the group, which is why he owns the stock for his charitable trust, Action Alerts PLUS .

Johnson Controls makes seating and interiors, batteries and HVAC systems for cars, and while only 42% of the company's revenues comes from autos, Cramer said the company has serious technology and manufacturing expertise that cannot be ignored. He said the company also has a great balance sheet.

During the downturn, Johnson Controls left many of its unprofitable businesses, and with auto manufacturers trending toward dealing with fewer suppliers, the company is one of only a few great companies left standing.

Johnson Controls trades at only 14 times its 2011 earnings, which makes it cheap, he noted. The stock may be only a point off its 52-week high, he noted, but it was a lot high before then.

Mad Mail

Cramer told viewers that patience does matter. Case in point, Cloud Peak Energy ( CLD), a stock Cramer recommended on its IPO, only to watch its price fall in weeks that followed.

Today however, the stock received an upgrade as the company is poised to benefit from a recovery in the coal market. Cramer said when investors do their homework, they will see weakness as opportunity, which is exactly what the decline in Cloud Peak represented.

Cramer told a viewer that he still likes Fluor ( FLR), a stock which he owns for his charitable trust, Action Alerts PLUS . He said it's still OK to buy the stock, even though it has run higher in recent days.

Cramer told another viewer that he'd take some profits in Starbucks ( SBUX), especially if investors have a big gain in the stock.

Finally, Cramer told a viewer that if given a choice between PPL Corp ( PPL) or Emerson Electric ( EMR), he'd choose the growth potential of Emerson over the safer, slow moving utility of PPL.

Lightning Round

Cramer was bullish on Verizon ( VZ), Teva Pharmaceutical ( TEVA) and Corning ( GLW).

He was bearish on 3Com Corporation ( COMS), Mylan Laboratories ( MYL), Sallie Mae ( SLM) and Constellation Brands Inc ( STZ).

Final Note

Cramer told viewers to buy Electronic Arts ( ERTS) on any sign of weakness Tuesday.

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

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