Cramer's 'Mad Money' Recap: How to Profit From Google's Speed Bump in China (Final)

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NEW YORK ( TheStreet) -- While tech stocks rallied today, Jim Cramer told the viewers of his "Mad Money" TV show Wednesday that Google ( GOOG) may have hit a speed bump that is serious enough to cause him to lower his price target on the stock.

Cramer said that any bump in the road can be serious for high-multiple stocks like Google, which are often priced for perfection. Thus, the company's standoff over cyber-attack issues with China must be taken seriously, he said. Even if pulling out of China means only a few cents off of Google's earnings, he said the effect on its stock price can be sizable.

Cramer said he fears not only for Google's potential lost search revenue in China, but also the possibility that the company's Android mobile operating system may get the boot as well. Given this uncertainty, Cramer said he's lowering his price target on Google from $750 to $700 a share.

Google's loss could be a big win for Apple ( AAPL), a stock which Cramer owns for his charitable trust, Action Alerts PLUS . Cramer said Apple's iPhone is just starting to take off in China, and the possibility of Android's demise in the country could ring big Apple.

Cramer said he's still bullish on Google, just not as bullish as he once was. He remains extremely bullish on Apple. Cramer also noted that now might be a good time to revisit Internet security company Arcsight ( ARST), which makes hacking detection software that Google is likely using to help it fend off China's unwanted advances.

The Lithium Play

When it comes to auto parts, batteries are the place to be, Cramer told viewers. But with most battery makers buried deep inside huge conglomerates, is there a way to make money from the coming boom in hybrid cars? Cramer said there is, but it's not where you'd expect.

Cramer said the natural choice would be to invest in two fairly new stocks, A123 Systems ( AONE) and Ener1 ( HEV), but that would be a mistake.

While both companies have received millions of dollars in government assistance and seem to be all the rage, he said neither company's business model has been proven. "Just because they've gotten government money doesn't mean they're going to sell batteries," he said. This skepticism is also share among short sellers, who already have a huge short interest in A123 and Ener1. Cramer said he'd steer clear of both stocks.

So with battery makers off the table, Cramer instead turned to what's inside the batteries, and for hybrid batteries that's lithium. Cramer said there's only one company he thinks of when he hears lithium, and that's Chemical & Mining of Chile ( SQM).

While the company is mainly a fertilizer play, 30% of the company's revenues comes from lithium, a number which is on the rise as batteries play more important roles in transportation.

Cramer said the stock has shed 6% since he last recommended Chemical & Mining on June 16. But he said now that fertilizer, the other 70% of the company's revenues, has stabilized, he's willing to double down and buy more.

Domino's New Look

After years of slumping sales, Cramer said Domino's Pizza ( DPZ) is once again beginning to deliver. He changed his tune and turned positive on the stock.

According to Cramer, Domino's understands what it's been doing wrong and changing course to turn itself around. The company has introduced a new pizza recipe, along with a new ad campaign, to change the tide in the domestic pizza wars. The company also has strong international sales and is benefitting from ailing competitors, said Cramer.

With over 9,000 locations across the globe, Cramer likened Domino's to an ATM that just throws off cash. He said the company's international sales, which had accounted for 30% of total sales, now account for 45%, and the company still has plenty of room to grow.

Turning back domestically, Cramer said Domino's is also benefitting from an implosion at Pizza Hut, part of Yum! Brands ( YUM), where same store sales plummeted 13% in its most recent quarter.

Domino's trades at just nine times its earnings, while rivals Papa John's ( PZZA) trades at 12 times and Pizza Hut trades at 13 times.

Cramer said giving Domino's a comparable multiple would make it a $14 stock, and given its strong international growth and new pizza, he think it could do even better.

Am I Diversified?

Cramer spoke with callers to see if their portfolios have what it takes. The first caller's portfolio included Procter & Gamble ( PG), Caterpillar ( CAT), Wal-Mart ( WMT), Waste Management ( WM) and Skyworks Solutions ( SWKS).

Cramer said this portfolio was perfect and well played.

The second caller's top holdings included Chesapeake Energy ( CHK), Cliffs Natural ( CLF), Dryships ( DRYS), Diana Shipping ( DSX) and JDS Uniphase ( JDSU).

Cramer said this portfolio had two of a kind with Dryships and Diana. He advised selling Dryships in favor of a health care stock.

The third caller had Apple ( AAPL), AT&T ( T), Duke Energy ( DUK), Freeport McMoRan ( FCX) and Pfizer ( PFE) as their top five stocks.

Cramer said this portfolio was also perfectly diversified.

Lightning Round

Cramer was bullish on Bucyrus International ( BUCY), Southern Peru Copper ( PCU), Boise ( BZ), Temple-Inland ( TIN) and International Paper ( IP).

He was bearish on Manitowoc ( MTW) and Pitney Bowes ( PBI).

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

To watch replays of Cramer's video segments, visit the Mad Money page on CNBC.

Want more Cramer? Check out Jim's rules and commandments for investing from his latest book by clicking here.

For more of Cramer's insights during the Lightning Round, click here .
At the time of publication, Cramer was long Apple, Procter and Gamble.

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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