Cramer's 'Mad Money' Recap: Tech Has Come a Long Way (Final)

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NEW YORK ( TheStreet) -- "Don't be too skeptical of big trends that can make you money," Jim Cramer told the viewers of his "Mad Money" TV show Thursday.

On the 10-year anniversary of the Nasdaq's all-time high, Cramer said there are stark differences between the tech rally back then, and the tech rally of today.

Cramer said sometimes it seems like this market just won't quit, with even the most speculative of tech stocks heading higher and higher day after day. But unlike the dot-com tech bubble of 2000, Cramer said today's tech rally is not about mindless speculation, but rather speculation done right.

He said today's speculative companies aren't being judged on eyeballs or page views, but instead on actual earnings.

What's driving the current tech rally? Cramer identified three themes powering tech stocks higher. The first is the need for a faster Internet that's capable of carrying more services, including video, to more and more consumers. He said this theme is driving stocks like F5 Networks ( FFIV), JDS Uniphase ( JDSU) and Akamai ( AKAM), to triple-digit gains for the year.

The second theme is cloud computing, said Cramer, which involves the sharing and storing of applications online, rather than on desktop hard drives. Cramer said this theme is driving stocks like IBM ( IBM), VMware ( VMW) and Oracle ( ORCL).

Finally, there's Cramer's much hyped "mobile Internet tsunami," which is all about the proliferation of smart phones and mobile devices. This theme is represented by Apple ( AAPL), a stock which Cramer owns for his charitable trust, Action Alerts PLUS , along with Research in Motion ( RIMM) and all of their component makers.

Cramer said unlike the dot-com bubble, new tech stocks are not coming to market every day, which only makes the existing ones, those with real earnings and solid growth prospects, even more valuable.

In the short term however, Cramer said these stocks may have gotten ahead of themselves, and it's prudent to take some profits and protect what gains investors may have. But over the longer term, Cramer said this tech rally is more than justified.

Mobile Internet Tsunami Play

In the "Executive Decision" segment, Cramer once again spoke with Bob Bruggeworth, president and CEO of RF Micro Devices ( RFMD), to discuss Cramer's mobile Internet tsunami thesis, and how it's affecting his company.

Bruggeworth confirmed that the mobile internet is still alive and well, with RF Micro's 3G cellular business up 80% year over year. He said the company's new product portfolio is taking the market by storm and has proven that RF Micro's leadership has helped differentiate it from other commodity players.

Bruggeworth also highlighted some of his company's other technologies, some of which are helping to make cable TV and broadband providers more energy effecient and is helping to make the smart-power grid into a reality. He said the company's smart-power grid products alone are set to double in 2010.

When asked about the company's plans to diversify away from a few select customers, Bruggeworth said that RF Micro continues to diversify, with major pushes in China and Korea, where it has done very well so far with its leading technologies.

Cramer said RF Micro still has a lot of room to run.

Red Flags

In the Thursday "Sell Block" segment, Cramer told viewers the headlines don't always tell the whole story. He said the "earnings beat" from liquor purveyor Brown-Forman ( BF-B), wasn't anything of the sort.

Cramer said when the maker of Jack Daniel's and Southern Comfort reported its earnings, the headlines crowed about a 10-cents-a-share earnings beat on 80- cents-a-share in revenue. But Cramer noted that in the details, eight to nine cents a share of those earnings came from inventory shifts, while another seven cents a share came from currency translation.

Cramer said adding up these accounting maneuvers quickly turned Brown-Forman's 10-cent beat into a five- to six-cent a share disappointment. Making matters worse, the company reported earnings-per-share declines of 10%, on lower operating income of 2%. In fact, Cramer noted that this is the third straight quarter where the company has seen price declines for its products.

The major issue facing Brown-Forman, said Cramer, is that consumers are trading down for lower priced alternatives. The company noted that even the flagship Jack Daniel's brand saw price declines.

Perhaps the biggest red flag for Cramer was on the company's conference call, where management spend considerable time recapping the company's 10-year history, rather than focus on current operating results.

Cramer said Brown-Forman is a sell, sell, sell.

Mad Mail

Cramer told a viewer that the research and asset management arms of big brokerages like Goldman Sachs ( GS) are completely separate, so it's not uncommon to see the firm recommending a stock, while selling shares at the same time.

Cramer told a second viewer that he's not familiar with the Cohen & Steers Realty Fund ( RQI), but said that Cohen & Steers have some of the best money managers around.

Finally, Cramer said that the sellers of ON Semiconductor ( ONNN) are totally wrong, as that semiconductor stock continues to head higher.

Lightning Round

Cramer was bullish on Ezcorp ( EZPW), Ford Motor ( F), Range Resources ( RRC) and Clean Energy Fuels ( CLNE).

He was bearish on Amylin Pharmaceuticals ( AMLN), Fuel Systems Solutions ( FSYS), XTO Energy ( XTO) and A123 Systems ( AONE).

Closing Comments

Cramer advised taking some profits in Citigroup ( C) ahead of the government's likely move to sell its stake in the company soon. "Don't be greedy," he said, "we can buy it back cheaper."

-- 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.

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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