NEW YORK ( TheStreet) -- "The X factor is not just for reality TV," Jim Cramer told the viewers of his "Mad Money"TV show Tuesday. He said when it comes to stocks, some companies have "it" and others simply don't. What's the X factor? Cramer said it's that little something special that makes investors want to pay up for some stocks, but not others. Something cool that cannot quite be explained. Cramer said X factor companies not only have great earnings and growth but also have that little something extra as well. Take Amazon.com ( AMZN). Cramer said Amazon rallied 1.6% today to a new high on no news to speak of. He said other companies, like Panera Bread ( PNRA) and Chipotle Mexican Grill ( CMG) have the X factor, that's why they trade at 34 and 44 times earnings respectively. Companies like Microsoft ( MSFT) and Research In Motion ( RIMM), no X factor, said Cramer. Meanwhile, electric car battery maker Polypore ( PPO), has the X factor. Then there's watch and accessory retailer Fossil ( FOSL), a stock that's up over 140% since Cramer first got behind the stock at just $44 a share. Fossil delivered a dazzling quarter with earnings up 62%, a 20-cent-a-share beat. Shares of Fossil rallied 12 points in a single day as analysts had to do a wholesale revision on their expectations. Cramer said Fossil clearly has the X factor, with robust growth all over the globe in not only watches, but also its jewelry and leather products as well. Fossil is cool, said Cramer, and the world knows it even if Wall Street doesn't. Cramer said that other stocks, like Deckers Outdoor ( DECK) and recently Dominos Pizza ( DPZ), also have the X factor, which is why he still likes both of these names as well.
Investing in CoalIn the "Off The Charts" segment, Cramer went head to head with colleague John Carter over the future of coal, still the cheapest way to provide electricity to the world's growing middle class. Cramer said unlike the markets for silver and oil, which are highly speculative, the coal market is driven by actual supply and demand and is far more stable than that of its peers. Carter used the weekly chart of the Market Vectors Coal ETF ( KOL) for his analysis and noted that after rallying in 2010, coal has been trading sideways, consolidating, and most recently has sold off to its support level. Using Elliot Wave Theory, Carter identified bullish trends in both the Elliot B and Elliot C waves and also noted the "squeeze" chart also pointed to the coal stocks taking off soon. Carter said he'd be a buyer of the coal ETF, using September call options. But Cramer said he doesn't like the coal ETF, which includes coal stocks from around the globe. He said if investors want to play the coal market, they need Peabody Energy ( BTU), the largest coal player in the business and the one most levered to the expanding Asian markets for coal. Cramer said coal is a fantastic long-term theme and Peabody is in the best position to export their coal to the growing global demand.
Electric Battery HeadwindsIn the "Executive Decision" segment, Cramer spoke with David Vieau, president and CEO of A123 Systems ( AONE), which makes batteries for electric cars and trucks. A123 just delivered a 51-cent-a-share loss for its most recent quarter, five cents a share worse than expected, on a 26% fall in revenues. Shares of A123 are now trading around $6 a share after a successful IPO last year that saw shares soar to $25. Vieau said that A123 is on the path to building enough Lithium Ion battery capacity to get costs down so it can produce a mass market item. He said the company has invested heavily to build the largest battery factory in North America and now has a tremendous asset at the ready. "We've been putting a lot of money in play," said Vieau, "but a lot of that is now behind us." Vieau said that the A123 battery's unique chemistry offers better safety and durability for electric vehicles. He also noted that there is nothing hazardous in A123 batteries, and many of their components can be recycled. When asked about the need for future financing and government loans, Vieau said the company just completed a $254 million secondary offering of stock to help it reach profitability. He said while some promised government loans in 2013 and 2014 may be in jeopardy due to budget cuts, A123 will have much stronger cash flow by then and will have other financing options available to it. Cramer said with shares of A123 now significantly lower than its IPO and much of the investment already having already been made, now might be the time to speculate on the coming of electric vehicles