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NEW YORK ( TheStreet) -- Investors are still fighting the tape, Jim Cramer told "Mad Money" viewers Tuesday, but that's not stopping just about every sector from housing and health care to retail and the rails from rallying and rallying big. Perhaps more interesting than the market rally is what's going on behind the scenes, he said -- the urge to merge has kicked into high gear. Cramer said while stocks are up big from their 2008 lows, they are still far cheaper than they were in 2007, which is making them more and more attractive to companies looking to grow on the cheap. He said news that OfficeMax ( OMX) and Office Depot ( ODP) are looking to merge shouldn't come as a surprise, as that's exactly what's needed to compete with Staples ( SPLS) and Costco ( COST). Then there's Heinz ( HNZ), a company that's been increasing earnings and expanding internationally for years. Yet, the analysts remained negative on the stock, said Cramer, which makes it no surprise that Warren Buffett became interested in buying the company. Dell ( DELL) is no different, said Cramer, nor is Virgin Media ( VMED), or Copano Energy ( CPNO) or Acme Packet ( APKT). In all of these cases, companies and their CEOs are betting big that weakness in the present will grow into big profits in the future. Confidence has returned to the markets, Cramer concluded, so rather than fighting the tide, why not jump in and join them?
Off the ChartsIn the "Off The Charts" segment, Cramer went head to head with colleague Tim Collins over the chart of SPDR Gold Shares ( GLD) to see if the precious metal should remain in your portfolio after what has been a difficult few months for gold. According to Collins, the nearly five-year bullish trend for gold ended in October, when the rally lost its mojo. He noted that investors continue with their "buy the dips" strategy, but since October, every dip has only yielded another leg lower. Gold could see a 3% to 4% bounce in the short term, said Collins, but he would not be a buying of that rally.
The weekly chart of the SPDR Gold Shares also confirmed this analysis because Collins noted a failed cup-and-handle formation, which is a bearish indicator. Collins felt GLD would remain rangebound between $150 and $175 a share, giving investors no reason to be long or short the commodity. Cramer said while he continues to think gold should remain a part of every portfolio, he agreed with Collins that there's no reason to add to a position, and it makes sense to remain cautious on gold. He said the SPDR Gold Shares ETF has held up far better than any of the gold mining stocks, which is why he continues to recommend that ETF over any other gold investment.
Action Alerts PLUS . But with the housing recovery powering ever higher, is the move in ADT over? Not by a long shot. ADT currently has 6.5 million customers for its safety and security services that include everything from fire and carbon monoxide monitoring to home and business security products. A full 90% of the company's revenue are recurring and ADT enjoys 25% market share, making it the largest provider in its markets. Cramer said ADT would make an excellent takeover for a larger company, but even without a takeover the company is still attractive because it's expanding its services and always offers the best products and pricing around. ADT is paying down debt and returning cash to shareholders with a 1% dividend yield and a stock buyback program that was recently accelerated by management. Cramer noted that while ADT has already run up big, given the company's potential for growth this is one name that's just getting started.