Cramer's 'Mad Money' Recap: Now, the Focus Is Earnings

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NEW YORK ( TheStreet) -- With the big bad health-care decision now behind us, the focus will be on earnings, Jim Cramer told his "Mad Money" TV show viewers Thursday.

Cramer said Wall Street money managers are known for making big bets on macro economy -- but four times a year, we call them earnings season, and those lofty bets come crashing back to reality. Fasten your seat belts, it's going to be a bumpy ride.

Cramer said the financials are still showing the bad and the ugly of the markets and will likely continue to do so until the housing market fully recovers. "Get ready for severe disappoints" in technology stocks, said Cramer, as even the mighty Apple ( AAPL), a stock he owns for his charitable trust, Action Alerts PLUS , will likely have trouble beating its numbers. As Research In Motion ( RIMM), the definition of horrible, has showed us, tech stocks have not fallen far enough to mitigate the risks.

Cramer said the oil stocks are also disasters and will not have anything good to say when they report over these coming weeks. So, too, with the industrials, many of which have huge businesses in Europe.

So where are the bright spots? Cramer said health-care stocks can be bought now that the Obamacare debate is over and companies have certainty again. Many of the retail stocks have already been "softened," said Cramer, meaning they can be bought as they sell off on earnings news. So, too, with consumer packaged goods companies like ConAgra ( CAG), which offer stellar dividend protection.

Looking at Celgene

A broken stock, or a broken company? Choosing correctly between those two options can make investors a lot of money, Cramer told viewers, as he looked into the case of Celgene ( CELG), the biotech that surprised Wall Street last week when it pulled its European application for Revlimid, it's blockbuster drug.

Cramer said shares of Celgene have fallen 11% since that news as no fewer than 19 analysts revised estimates downward for the company. He said that Celgene's credibility has been crushed, along with its stock price. But is the company now a buy?

Cramer said yes, it is. The selling have been overdone and the outlook for the company remains strong. He noted that in the three months leading up to the news, shares of Celgene fell by 16%, making the stock cheap even before the news. Shares now trade at less than 11 times earnings, despite the fact management reaffirmed its guidance.

Over the long term, Cramer said the Revlimid news simply isn't that bad. It has delayed, but not killed, the drug's approval in Europe by about 18 months. Celgene still has a healthy stable of other drugs in the pipeline to help it grow. In fact, Celgene has nine drugs in phase two and phase three clinical trials.

Cramer said shares of Celgene are now way too cheap, but still could get cheaper. He advised buying half a position now and waiting until after the quarter ends Friday to pick up the other half.

Still a Growth Story, But...

So what does a broken company look like? Cramer said that it doesn't look like Bed Bath & Beyond ( BBBY), a best-of-breed growth stock that was up 27% for the year before the company stumbled last Wednesday when it delivered slowing same-store sales and tepid guidance. Shares of Bed Bath and Beyond fell 16% on the news.

Despite popular belief, business at Bed Bath & Beyond is not falling off a cliff, said Cramer, as management is simply under-promising and over-delivering as they have many times in the past. The company sells housewares, he said, not the kind of items consumers are likely to buy online. With gas prices falling, consumers have more money in their pockets to spend.

Cramer said the growth story remains intact at Bed Bath, as the company looks to acquire Cost Plus ( CPWM), an acquisition that will offer many synergies to its current business. The company also has a $600 million stock buyback program.

With shares going from expensive to cheap at a new land-speed record, Cramer said he'd also buy half a position at current levels and complete that position after the company reports its next quarter. Shares of Bed Bath & Beyond are trading at 11.7 times earnings with a 13% growth rate.

Lightning Round

Here's what Cramer had to say about callers' stocks during the "Lightning Round":

Ariad Pharmaceuticals ( ARIA): "I still like the stock very much. The speculative stocks are paying off big. Sell half and let the rest run."

Weight Watchers ( WTW): "I still don't like it. It's a dangerous stock and the company has lost its momentum."

Telefonica Brasil ( VIV): "I have Verizon ( VZ) with a better yield. I want to stick close to home right now."

Mosaic ( MOS): "Here's the problem. The ag trade has been going on for four days now and that's about how long they run. It's time to get out."

Companhia Siderurgica Nacional ( SID): "No, no, no. They have not been able to deliver. I am not going there."

ConocoPhillips ( COP): "I bless it. Oils yielding more than 3.5% are a buy and Conoco is now near 5%."

Mad Mail

In the "Mad Mail" viewer feedback segment, Cramer followed up on Ironwood Pharmaceuticals ( IRWD), a stock that stumped him in an earlier show. He said this stock is playing "FDA roulette" and is dependent on key drug approvals. He recommended it only as the speculative part of a portfolio.

Cramer said he saw dark clouds over Liquidity Services ( LQDT) and is not a fan. Likewise with Petroleo Brasilerio ( PBR), a stock Cramer said to sell, sell, sell.

When asked whether MasterCard ( MA) is pulling ahead of rival Visa ( V), Cramer said that in reality the opposite is true and Visa is the better stock.

Finally, when asked whether Apple might be buying chipmaker Micron ( MU), Cramer said "absolutely not" and advised selling Micron as all costs.

No Huddle Offense

In his "No Huddle Offense" segment, Cramer opined on the news that Barclay's PLC ( BCS) has been ordered to may $454 million in fines related to the illegal manipulating of key interest rates.

Cramer called the fraud simple "lawlessness," adding that the "steep fines" leveled against the company only hurt its shareholders, while the real culprits -- the traders -- laugh all the way to the bank.

He said that our country prosecutes all sorts of organized crime, but rarely those on Wall Street who are responsible for far greater damage. "Shame on the government," he concluded, for penalizing the shareholders while letting the criminals go free.

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

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At the time of publication, Cramer's Action Alerts PLUS had a position in AAPL.

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