Cramer's 'Mad Money' Recap: Stellar Year for Stocks (Final)

Search Jim Cramer's Mad Money trading recommendations using our exclusive Mad Money Stock Screener and watch Jim Cramer's Mad Money Post Game video exclusively on

NEW YORK ( TheStreet) -- "This is shaping up to be a very happy new year for stocks," an elated Jim Cramer told the viewers of his "Mad Money"TV show Monday.

Cramer predicted a stellar year for stocks, one that will send the Dow Jones Industrial Average to 13,365 by year's end.

Cramer said after doing nothing for almost a decade, stocks have finally broke even with their 2001 levels and are now ready to run. Why so bullish? In a word, hiring. After two years of cost cutting and playing defense, companies are now flush with cash and are ready to raise their dividends and start putting people to work.

Cramer called hiring a virtuous circle for stocks. He said hiring makes everything better, including the bottom lines of city and state governments and the federal deficit. Making matters even better, Cramer said investors are once again excited about the markets, and are putting their money back to work.

Where will the bull market be seen? Cramer said he took a bottom's up approach to his 13,365 Dow target, and sees strength in offensive plays like Boeing ( BA), a stock which he owns for his charitable trust, Action Alerts PLUS, and Home Depot ( HD). Cramer also gave the nod to Cummins ( CMI), another Action Alerts PLUS name, and Huntington Bancshares ( HBAN).

On the downside, Cramer said the defensive names, like Kraft ( KFT), Pfizer ( PFE) and Merck ( MRK) will likely not participate in the 2011 rally.

Likewise with old line tech giants like Microsoft ( MSFT), Hewlett Packard ( HPQ) and Cisco ( CSCO).

Cramer said 2011 will also prove to be the year of the banks, the one sector that benefits most from an uptick in consumer spending, lending and hiring.

Top Dow Stocks

Continuing with his new year's predictions, Cramer offered up his top three best performing stocks in the Dow for 2011. Coming in at number three was American Express ( AXP), a stock which Cramer predicted will see a 40% rise to $60 a share.

Cramer said this Action Alerts PLUS stock is the best way to play the return of travel and the business customer. American Express is already seeing improvement in its financials, with net charge offs down 0.3% and delinquencies off 0.1% in its most recent quarter.

With the government done meddling with credit card and financial regulations, Cramer said American Express is a cheap stock trading at just 12 times earnings. He said the company could earn $4 a share in 2011 and deserves a 15 multiple.

In the second slot was Intel ( INTC), yet another Action Alerts PLUS pick for Cramer. He said Intel has become a hated stock on Wall Street, but despite reports to the contrary, the PC is not dead. In fact, Cramer said PC sales should be strong in 2011 on the heels of Intel's next generation microprocessors.

The company is also moving aggressively into processors for tablet and smartphones, two of the hottest segments around. With its 3% yield, and recent McAfee acquisition, Cramer said Intel is far too cheap at just 9.2 times earnings.

Alcoa Shines

Cramer's favorite name in the Dow for 2011 was Alcoa ( AA), another name in his Action Alerts PLUS portfolio. Alcoa will give investors two ways to win, said Cramer, either through great earnings or by being taken over.

Alcoa is firing on all cylinders, said Cramer, as global demand for aluminum continues to surge from intense demand in bull markets in aerospace, autos and gas turbines as well as a recovery in housing and construction. Alcoa is also benefiting from the bull market in trucks, which Cramer said will propel Cummins into the top performing slot in the S&P 500 for 2011.

With Alcoa being such a well run company, one that is generating huge cash flows while paying down its debts, Cramer said the company is also a prime takeover target. He said the company could earn $1.50 per share in 2011, and deserves a 12 times multiple. But given its takeover prospects, Cramer said Alcoa is worth $22 a share, or a 43% gain. He would be a buyer ahead of Alcoa's earnings release on Monday, and would buy even more on weakness.

Story Intact

In the "Executive Decision" segment, Cramer spoke with Jim Whitehurst, president and CEO of Red Hat ( RHT), a stock whose shares have risen 13% since Cramer last recommended it on Sept. 28.

Whitehurst reminded viewers that other than platforms using Microsoft's proprietary software, every cloud computing application today is running on Linux or open source software like those that Red Hat provides. He said 70% of the Fortune 500 companies now utilize Red Hat software somewhere in their businesses.

Turning to the company's most recent results, the CEO said that all of the company's top 25 renewals for the quarter did renew, with revenues increasing by 20% thanks to increased footprints within those companies. He said Red Hat has kept pricing the same over the past two years, yet the company has been able to grow since the number of installations continues to grow.

Asked about the holiday season for Red Hat, Whitehurst said he had "no complaints," noting results were consistent with expectations.

Whitehurst also noted that government sales continue to be the company's strongest sector, with Europe and Latin America leading the charge. In the U.S., Whitehurst saw growth in federal business and also in state governments, although states, he noted, are far smaller.

Finally, when asked where Red Hat fits in with tech giants like ( CRM) and IBM ( IBM), Whitehurst said both companies' cloud computing platforms run on Red Hat, and both companies are great partners.

Cramer said the Red Hat Story remains intact, and he'd continue to be a buyer.

Ridiculously Cheap

In his "No Huddle Offense" segment, Cramer said Airgas ( ARG) has just gone from "cheap" to "outrageously cheap" now that the hostile takeover from Air Products ( APD) has been squashed. He said the takeover put a ceiling on Airgas, a stock that otherwise would have been on fire.

Cramer said there are very few cyclical stocks that haven't broken out to the upside, and Airgas won't be among that group for long.

Lightning Round

Cramer was bullish on Eli Lilly ( LLY), ( BIDU), American Axle ( AXL), Ford Motor ( F), General Motors ( GM)and Diageo ( DEO).

There were no bearish picks.

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

To contact the writer of this article, click here: Scott Rutt.

To follow the writer on Twitter, go to

To submit a news tip, send an email to:

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, clickhere .

At the time of publication, Cramer was long Boeing, Cummins, American Express, Intel, Alcoa.

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.

More from Jim Cramer

Snap, Gilead Sciences, Cronos Group: 'Mad Money' Lightning Round

Snap, Gilead Sciences, Cronos Group: 'Mad Money' Lightning Round

The Trouble With Trump's Tariffs: Cramer's 'Mad Money' Recap (Friday 6/22/18)

The Trouble With Trump's Tariffs: Cramer's 'Mad Money' Recap (Friday 6/22/18)

REPLAY: Jim Cramer on the Markets, Oil, Starbucks, Tesla, Okta and Red Hat

REPLAY: Jim Cramer on the Markets, Oil, Starbucks, Tesla, Okta and Red Hat

Jim Cramer: Some Industrials Stocks Are Becoming Great Values

Jim Cramer: Some Industrials Stocks Are Becoming Great Values

Jim Cramer Reacts to Toni Sacconaghi's Latest Tesla Note

Jim Cramer Reacts to Toni Sacconaghi's Latest Tesla Note