Cramer's 'Mad Money' Recap: Focus on Making Money

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NEW YORK ( TheStreet) -- Don't focus on Italy, focus on the best way to make money, Jim Cramer told "Mad Money" TV show viewers Tuesday. He said the best way to make money in the markets is not to fret over Italy but to focus on everything that's working right here in America.

Cramer said the days when Italy's economy could drag the U.S. down with it are over. The U.S. is stronger, he said, while Italy, and indeed most of Europe, has only slid further into irrelevancy.

Meanwhile, here in the U.S. we have an unbelievable housing recovery underway, one that's led Home Depot ( HD) to post what Cramer called the single best earnings so far in 2013.

Home Depot, a stock Cramer owns for his charitable trust, Action Alerts PLUS , posted a strong 7% gain in same-store sales and boosted its dividend by 34%, all while buying back more of its stock and maintaining a positive outlook for the rest of 2013.

When asked where the company is seeing strength, Home Depot management rattled off a list of departments that sounded more like a store directory than pockets of strength. Everything from tools, lumber and lighting to kitchens, bath and decor saw rising sales.

Cramer said he wouldn't buy shares of Home Depot at current levels, but on any weakness he's a buy, buy, buyer. He said the spillover from Home Depot will be good news for all the housing-related stocks including Stanley Black & Decker ( SWK), Eaton ( ETN), Masco ( MAS), Lumber Liquidators ( LL) and countless others.

Put Italy in perspective, Cramer concluded, and buy some Home Depot.

Executive Decision

In the "Executive Decision" segment, Cramer spoke with Chip Johnson, CEO of Carrizo Oil & Gas ( CRZO), a stock that's fallen 20% since Cramer last spoke with Johnson in March 2012. The company just posted a 19-cent-a-share earnings beat.

Johnson said Carrizo is still building value for its shareholders. He said the company's proven reserves are now valued at $1.4 billion. Adding on unproven assets, that figure is likely north of $3.6 billion. Unlike many drillers that have been slow to transition away from natural gas and into the more lucrative oil markets, Carrizo has been able to move quickly, said Johnson, which is only helping production increase ahead of schedule.

When asked about where Carrizo's oil goes after it's drilled, Johnson said his company sells its oil to companies, which haul it to the Gulf coast via truck, rail or barge. There, he said, it is sold at the higher Brent crude prices and usually refined into diesel fuel and sold into the Latin American marke,t which offers the highest margins for the refiners.

When asked about margins, Johnson explained Carrizo is essentially producing oil for a scant $30 a barrel and selling it for $100 a barrel, affording it a tremendous gross margin at today's prices.

Cramer said Carrizo has everything he's looking for including great assets, production growth and a solid plan for the future.

Off The Charts

In the "Off The Charts" segment, Cramer went head to head with colleague Caroline Boroden over the direction of the markets and of three stocks in particular. Boroden's predictions of the markets have been spot-on in recent months, as she's called the S&P 500's June retracement, its September top and subsequent lows in November.

So which stocks are Boroden focusing on now? Cramer said they are Amazon.com ( AMZN), Michael Kors ( KORS) and Schlumberger ( SLB), another stock Cramer owns for Action Alerts PLUS.

Boroden noted that after topping out in January, shares of Amazon have been sliding lower. But she sees support between $243 and $245 a a share and also between $236 and $239. She said that either range is buyable once the stock has tested and held either level.

A similar pattern exists for Kors, with supports $57, $53 and $49 a share, and Schlumberger, with supports between $72 and $74 a share and also at $70 a share. In both cases, Boroden suggested waiting to confirm the stocks have held those levels before buying.

Cramer said he once again agrees with Boroden on these three stocks, but rather than buying in at certain technical levels he prefers using wide scales and buying more on weakness.

Lightning Round

In the Lightning Round, Cramer was bullish on HomeStreet ( HMST), Royal Dutch Shell ( RDS.A) and McDonald's ( MCD).

Cramer was bearish on Alcoa ( AA).

Cancer Treatment Breakthrough?

In his second "Executive Decision" segment, Cramer sat down with Daniel Junius, president and CEO of ImmunoGen ( IMGN), a speculative biotech developing the next generation of cancer-fighting drugs. ImmunoGen just received Food and Drug Administration approval for its latest breast cancer drug, T-DM1.

Junius said T-DM1 is a big breakthrough in breast cancer treatments and the drug should be available to patients within the next two weeks. He said it's exciting for both its therapeutic value but also because it will provide ImmunoGen a steady revenue stream for its other drugs in the pipeline.

Among those other drugs are IMGN-853, which is in early-stage testing to treat ovarian cancer, and IMGN-901, to treat small-cell lung cancer. Junius said the 853 is an important compound for the company and could lead to other indications, while 901 is showing encouraging results in prolonging life where there hasn't been any new treatments in 25 years.

Junius also stressed the importance of these early-stage trials. He explained that time is money for the company, so getting patients into studies quickly allows them to make important go or no-go decision early so they can focus on only the most promising compounds.

Cramer called ImmunoGen one of the least hyped but still most important speculative biotech news out there for investors.

No Huddle Offense

In his "No Huddle Offense" segment, Cramer posed this question: Have hedge funds become too powerful? He said David Einhorn suing Apple ( AAPL) over its cash hoards is just the tip of the iceberg. Other activist investors have taken aim at Herbalife ( HLF), Hain Celestial ( HAIN) and Yahoo! ( YHOO), among countless others.

Cramer said that Apple has soared 6,300% over the past decade -- doesn't that give the company some benefit of the doubt? He said Einhorn needs to accept Apple for what it is -- the company is only playing by the rules and, in the end, shareholders have little to gain from his proposals.

Cramer said these activist actions are far less about doing good for shareholders as they are ways for hedge funds to prop up their performance. These guys need to admit they were wrong and just sell their positions, he concluded.

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To watch replays of Cramer's video segments, visit the Mad Money page on CNBC.

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

To email Scott about this article, click here: Scott Rutt

Follow Scott on Twitter @ScottRutt or get updates on Facebook, ScottRuttDC
At the time of publication, Cramer's Action Alerts PLUS had a position in AAPL, ETN, HD and SLB.

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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