Cramer's 'Mad Money' Recap: Global Balancing Act (Final)

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NEW YORK ( TheStreet) -- "Today was a microcosm of the market," Jim Cramer told his "Mad Money" TV show viewers Monday. He said despite the markets ups and downs, the markets seem pretty steady, unlike that of 2011.

Cramer said on the surface it might seem easy to draw a parallel between now and this same time last year. Both years started out with a bang, he said, but last year's markets hit a big wall named Europe. But that's not the case this year, as the market dynamics are different.

Cramer likened the market to a four-legged stool, with the legs represented by the U.S., Europe, China and the emerging markets. He explained that last year the U.S. markets were doing nothing, while Europe was just realizing it was in big trouble.

Meanwhile China was putting the breaks on its red-hot real estate markets and the emerging markets were slowing their economies as well. Putting all four of those factors together meant that there was no way the slowly improving U.S. markets could escape the pull from Europe.

Fast forward to today and Cramer said the markets paint a different picture. Europe is still in a recession, he said, but there is some progress being made on the debt issues. The European economies could still take a turn for the worse, but largely they've stabilized.

Things are still slowing in China, said Cramer, but at least that country is letting up on the brakes, as are the emerging markets like Brazil. Meanwhile, the U.S. economy is picking up steam, led by aerospace, oil and gas, autos and non-residential construction.

Cramer said today's stool creates a mixed picture, but one that's far better than it was just a year ago. Thus the markets are tipped by news from Europe and can react positively to news out of China, but largely they hold their own. Cramer said this can be seen in today's trading action, as stocks sold off in the morning while the European markets were trading, but rallied in the afternoon as the U.S. news ruled the rest of the day.

Turnaround Play

"The market rewards improvement," Cramer told viewers, as he highlighted Newell Rubbermaid ( NWL), a company that has been struggling for ages but now may be poised for a major turnaround. Last week, Rubbermaid reported terrific quarterly results, sending shares up 8%.

Cramer said that Rubbermaid has brands that we all know and love, brands like Rubbermaid, but also Calphalon in the kitchen and Sharpie at the office. This means that the company will benefit from the growing home improvement trend as consumers beef up spending on their homes.

But Rubbermaid is about more than just a rise in consumer spending, said Cramer, it's also about a major restructuring. The company has pared down its business divisions from 13 to just nine and has organized them into just two groups, consumer and professional. That means a drastic reduction in its bloated costs including redundant sales forces and overhead.

Cramer said that Rubbermaid is now also a lot less hostage to rising resin and natural gas prices thanks to the continued diversification of its product lines. The company's CEO also has "street cred," said Cramer, after being a winner in consumer products for many years.

After losing nearly 85% of its value from 2007 to 2009, shares of Rubbermaid currently sell for just 10.3 times earnings with the company's 9% growth rate. Cramer said the company derives only 10% of its sales from the ailing Europe and has the ability to boost its dividend after a 69% cut in 2009 and another 21% cut in 2010.

Cramer said his bottom line is that sometimes the real winners aren't "A" students, they're "D" students that are turning themselves into "B" students.

Discretionary Spending Trade

Kicking off a new series entitled "Show-Off Stocks," Cramer turned the spotlight onto what he called a multi-year trend towards increased discretionary spending. His first show-off stock was Brunswick ( BC), the world's No. 1 maker of boats and other discretionary items like billiard tables and bowling equipment.

Cramer explained that boats and boat engines account for 75% of Brunswick's sales and that means that investors can make boatloads of money from this growing business.

While competitors have been hit hard by the recession and have closed dealers, Brunswick has been taking share and has seen its dealer count increase slightly. Additionally, the average age of a powerboat in the U.S. is up to 21 years from just 15 years, meaning a large portion of older boats are likely to be upgraded in the near future.

Boats may the be ultimate in discretionary spending, but with shares of Brunswick trading just under $21 a share and off its $50 highs just a few years ago, Cramer said this stock has room to run. Brunswick is trading at 11 times earnings with a 13% growth rate, he said, and the company also has a strong exercise and bowling business to boot.

Momentum-Building Quarter

In the "Executive Decision" segment, Cramer spoke with Rick Wallace, president and CEO of KLA-Tencor ( KLAC), which blew away earnings estimates, delivering a seven-cent-a-share earnings beat on a 95% increase in orders from its previous quarter.

Wallace said that he saw momentum building throughout the quarter, with mobility products now accounting for over half of the company's demand. He said the demand for mobile devices, including smartphones, tablets and e-readers is on fire, and when manufacturers need more performance and better battery life, the chipmakers need the next-generation of KLA-Tencor equipment.

Wallace noted that he's seen broad demand for all sorts of mobile devices, something his company has not seen for a long time. He said there's certainly room for lots of devices outside of those made by Apple ( AAPL), a stock which Cramer owns for his charitable trust, Action Alerts PLUS .

Wallace also noted that returning cash to shareholders has been a priority for KLA-Tencor since 2005 and the company remains committed to both boosting its dividend and buying back stock as appropriate. He said the company has a huge backlog and great revenues to handle the ups and downs of the business cycle.

Cramer said that KLA-Tencor is one of the most promising tech stories in the market today, adding he remained bullish on the stock.

Lightning Round

Cramer was bullish on Caterpillar ( CAT), Manitowoc ( MTW), Cisco Systems ( CSCO), Under Armour ( UA), Northern Oil and Gas ( NOG), EOG Resources ( EOG), Continental Resources ( CLR), International Business Machines ( IBM) and Annaly Capital ( NLY).

Cramer was bearish on Qualcomm ( QCOM), Terex ( TEX), Polycom ( PLCM) and Ares Capital ( ARCC).

Some Thoughts on Facebook IPO

In his "No Huddle Offense" segment, Cramer once again opined on the coming Facebook IPO. He said there's no doubt that the company is popular and mainstream, nor that it's a leader in display advertising on the Web. But will its coming IPO be a good one?

Cramer said that question can only be answered when the terms of the deal are disclosed. He said it depends largely on how many shares are issued, and not necessarily by the price they're offered at. He said if the bankers don't get greedy, it's likely to be a good deal, but that also means that shares will be short supply.

"Until we know more," Cramer concluded, "don't make a move."

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

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

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At the time of publication, Cramer was long Apple.

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."

None of the information contained in "Mad Money" constitutes a recommendation by Mr. Cramer, TheStreet.com 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 TheStreet.com, 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 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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