NEW YORK ( TheStreet) -- "The biggest surprise of 2012 could be seeing the financials rally," Jim Cramer told his "Mad Money" TV show viewers Monday. He explained that when the financials rally, and the tech stocks rally, then the sky's the limit for the rest of the market. Cramer said that both the tech stocks and the financials have been laggards though out the back half of 2011, but now in 2012 both groups seem to be leading the markets higher once again. In the case of the tech stocks, expectations have set the bar so low and it's almost certain the group will be able to rally off their lows, he said. Just today in fact, there were two upgrades of semiconductor companies, he said. That means stocks like Texas Instruments ( TXN) and Broadcom ( BRCM), a stock which Cramer owns for his charitable trust,
Oil Service PlayCramer said that one of the biggest mantras for 2012 will be "in oil we trust," as the price of crude oil continues to surge, with just about nothing to get in its way. That's why he highlighted the little known oil service company Key Energy Services ( KEG) as a great way to play the continued oil drilling boom here in the U.S. Cramer explained that Key is an on-shore well services company, along the lines of Haliburton ( HAL) and Schlumberger ( SLB), only Key is honed in on the hottest area of U.S. drilling, hydraulic fracturing. The horizontal wells used in fracturing require more maintenance and service than traditional vertical wells, explained Cramer, and Key has special techniques that allow repairs to be done even when the well is still operating, minimizing downtime. The company is also a large player in the wastewater treatment and disposal business with a fleet of tanker trucks and 65 salt water disposal wells. Cramer said he also likes the company's international exposure, which accounts for 20% of sales but is expected to grow between 40% and 50% in 2012. Trading at just 9.7 times forward earnings with a 12% long-term growth rate, Cramer said that Key Energy Services has a great PEG ratio, which makes it more attractive than its larger peers.
Unlikely Housing ThemeWhat's another unlikely theme for 2012? Cramer said it just might be a turn in housing. He said the evidence of a bottom in housing is beginning to materialize, from stronger home sales numbers to upside surprises from home builders to an improving employment picture. But the way to play this recovery in housing is not with the homebuilders, said Cramer, or even with the materials stocks, as they've already run up big. Instead, Cramer suggested Weyerhaeuser ( WY), an Action Alerts PLUS holding. Cramer explained that Weyerhaeuser is the second largest owner of timberland in our country, with an astounding 6.15 million acres. The company mainly makes wood building products, but also manufactures paper and packaging materials as well as having a small home building division. Cramer said that Weyerhaeuser has great management that has been streamlining operations, selling non-key assets and improving costs across the board. This makes the company far less cyclical and dependent on a strong economy as it has been in the past. Weyerhaeuser recently converted itself into a real estate investment trust, or REIT, which has greatly improved costs as the company now pays over 90% of its earnings directly to shareholders. Weyerhaeuser also has exposure to Asia and China as well, another plus. Cramer said that investors can't wait for a turn in the U.S. housing market in order to buy Weyerhaeuser, emphasizing the time is now. He said the company's 3.2% dividend yield will pay them to wait for the housing market to improve, at with time Weyerhaeuser will be printing money hand over fist.