Cramer's 'Mad Money' Recap: Hunting for Bargains on a Down Day (Final)

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NEW YORK ( TheStreet) -- "The averages may be telling us to shiver in fear, but the data is telling a different story," Jim Cramer told the viewers of his "Mad Money" TV show Wednesday.

He said the statistics from individual companies continue to tell him that the recovery is still on track, so he's ignoring the headlines and the averages and is looking for bargains.

Cramer said that the data is telling him that we're still in good shape, economically speaking, and he just can't ignore such powerful signals. He said that when Tractor Supply ( TSCO), which sells expensive things to farmers, says it's having a good quarter, he has to pay attention.

Likewise with a report citing that the price of uncoated free sheeted paper is heading higher. Cramer said this type of paper is practically the definition of a commodity, so if it's on the rise, then that's good news for International Paper ( IP).

Then there's the recent report which said memory chips are in a multi-year up cycle. That's great news for Micron Technology ( MU), said Cramer.

And there are plenty of other positives as well, said Cramer, like a report that noted that many high-interest bank CDs are coming due, which will be a windfall for banks like Citigroup ( C), when these high-interest CDs are replaced by today's lower yielding counterparts.

Finally, Cramer said there are upgrades galore, with companies like Urban Outfitters ( URBN), Staples ( SPLS) and Polo Ralph Lauren ( RL) all receiving upgrades today.

Cramer said with all of this positive news, he has no choice but to sit up and take notice, to look at what went down today, and to do some buying tomorrow.

Banking Plays in the Golden State

"There's a turn happening in California," Cramer told viewers, and when it comes to the banking sector, there are a lot of ways to play.

Continuing his series on California stocks that are on the move, Cramer highlighted several banks poised to gain big as the state's housing market finally begins to recover.

He said investors can look at the big national banks, like US Bancorp ( USB) and Wells Fargo ( WFC), which represent 23% and 21% of the state's consumer deposits respectively, or, he said, investors can look into regional plays.

Cramer recommended CVB Financial ( CVBF) as a speculative stock, and Westamerica Banc ( WABC), as two regional banks with a lot of potential.

But Cramer said his favorite stock in the group is City National ( CYN), California's eighth largest bank. He said that City National is a statewide play and is doing everything right, like repaying its TARP loans and even making an FDIC assisted acquisition.

The bank is well capitalized, at 9.1%, compared to an industry average of just 7.8%. Cramer said City National also has a great wealth management business, with over $55 billion under management.

Generic Drug Powerhouse

In the "Executive Decision" segment, Cramer spoke with Bill Marth, North America president and CEO of Teva Pharmaceuticals ( TEVA), a stock which Cramer owns for his charitable trust, Action Alerts PLUS.

Cramer was especially interested in Teva's recent acquisition of Raiopharm for $5 billion. Marth explained that Teva saw a lot of synergies with Ratiopharm, and was able to assess the company's true value. He said the acquisition makes Teva the No. 1 player in Europe, which will be huge for the company.

When asked about Teva's own proprietary drugs for Parkinson's disease coming off patent soon, Marth said that drugs transitioning to generics is part of the cycle of innovation, and the key is effective planning when those transitions are occurring.

Finally, when asked why Teva seems to make more money with its generic drugs than anyone else, Marth explained that Teva is able to make difficult formulas first, which provides them a 180-day marketing exclusivity that allows them to gain share and increase profitability.

Cramer said he's a believer in Teva.

Am I Diversified?

Cramer spoke with callers to see if their portfolios have what it takes. The first caller's portfolio included: Dow Chemical ( DOW), Ford ( F), Boeing ( BA), Caterpillar ( CAT) and Citigroup ( C).

Cramer said this is the portfolio he wants viewers to have.

The second caller's top holdings included Cisco ( CSCO), Walt Disney ( DIS), Starbucks ( SBUX), Bed Bath & Beyond ( BBBY) and US Steel ( X).

Cramer said this portfolio was also perfectly diversified.

The third caller had RF Micro Devices ( RFMD), MDU Resources ( MDU), North American Paladium ( PAL), Windstream ( WIN) and Dish Network ( DISH).

Cramer said this was not his favorite portfolio, but it was diversified.

Lightning Round

In the Lightning Round, Cramer was bullish on Fluor ( FLR), Jacobs Engineering ( JEC), Salesforce.com ( CRM), Republic Services ( RSG), Waste Management ( WM), Flextronics ( FLEX), Jabil Circuit ( JBL), Tellabs ( TLAB), ADC Telecommunications ( ADCT), Cadence Systems ( CDNS), Potash ( POT) and Deere & Co ( DE).

He was bearish on Chicago Bridge & Iron ( CBI), Compuware ( CPWR), Monsanto ( MON) and Ebix ( EBIX).

Closing Comments

Cramer said Bed Bath & Beyond ( BBBY) had a fabulous quarter, and he expects it to head a lot higher.

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

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

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

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

At the time of publication, Cramer was long Teva Pharmaceuticals.

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

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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 TheStreet.com. 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 TheStreet.com, 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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