Cramer's 'Mad Money' Recap: Follow the Market Leaders

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NEW YORK ( TheStreet) -- It's time to follow the market leaders into battle, Jim Cramer announced to "Mad Money" TV show viewers Thursday.

All it takes is a quick glance at the list of new highs to see the very best that American business has to offer, he said.

What are some of these great American companies? Cramer said Berkshire Hathaway ( BRK.B) is one. He said Warren Buffett's conglomerate has exposure to insurance, household brands and railroads, to name just a few. If Berkshire is hitting 52-week highs, he said, that's a green light to buy a host of other names in those sectors.

Boeing ( BA) is another company on Cramer's list, albeit an unlikely one given a labor strike, exploding batteries, a strong dollar and government sequester. Yet, through it all, Boeing, continues to soar. That's great news for not only Boeing, said Cramer, but also for its suppliers and the airlines and the travel and leisure names as well.

Honeywell ( HON) is also hitting new highs, said Cramer, and that's great news for aerospace, refining, safety equipment and climate controls, among other sectors. Then there are the new highs from consumer staples Colgate-Palmolive ( CL) and Johnson & Johnson ( JNJ), signaling the consumer is alive a well.

In the banking sector, JPMorgan Chase ( JPM) has emerged from the financial crisis as the blue-chip survivor, said Cramer, and its new highs signal great things coming in the financial and banking sectors.

Even Cisco ( CSCO) is making new highs, as that embattled tech giant has redefined itself as the equipment provider for the backbone of the Internet and telco.

Follow all of these leaders, Cramer concluded, because they are in control of the markets.

Rising SunTrust

With the next round of government stress test results due out in just one week, Cramer said the time is now to get into shares of SunTrust Banks ( STI), a stock Cramer has been buying for his charitable trust, Action Alerts PLUS .

Cramer called 2013 the "year of the regional banks," saying that with housing and employment on the mend, these now "lean and mean" regionals will be poised to prosper and, with the government's blessing, will be able to return those winnings to shareholders.

During the last round of bank stress tests, SunTrust failed to make the grade, but Cramer said the company has been aggressively working to better its balance sheet and lower its expenses by workforce reductions. It has also been growing its deposit base while making more money from increased mortgage activity throughout the Southeast and Mid-Atlantic, where it remains a dominant player. SunTrust delivered a four-cent-a-share earnings beat when it last reported.

With SunTrust expected to pass this round of stress tests with flying colors, Cramer said he expects to see the company buy back as much as 5% of its shares, thereby dramatically reducing its share count and boosting its earnings per share. He also expects to see a sizable dividend boost to boot.

Cramer said expectations for SunTrust are very low, which has caused the stock to lag its peers, something he expects will change starting next week.

Building an Energy Renaissance

The North American energy renaissance rages on, Cramer told viewers, and that's great news for not only the oil and gas companies but also for the engineering and construction companies that are helping to build out our much needed energy infrastructure.

Everything from pipelines to power plants to refineries to export terminals are being built, explained Cramer, and one company, Chicago Bridge & Iron ( CBI), seems to be at the heart of it all.

Cramer said that despite its name, Chicago Bridge and Iron, another Action Alerts PLUS holding, doesn't just build bridges and it isn't located in Chicago. But that didn't stop it from delivering an eight-cent-a-share earnings beat on a 22% rise in revenues, sending shares to all-time highs.

Compare that to another engineering and construction player, Foster Wheeler ( FWLT), which posted a 19-cent-a-share earnings miss on a 35% fall in revenue, and Cramer said it's easy to see which company is the best of breed of the group.

Chicago Bridge's strength is being helped by its acquisition of Shaw Group, which has helped send its backlog of business to a staggering $28 billion. Yet, the stock still trades at just 14 times earnings with a 23% growth rate. Cramer said that low valuation won't last long as the company has an analyst day coming March 28 and will be explaining to the world just how well the Shaw acquisition is going.

Foster Wheeler, on the other hand, is a far smaller business, said Cramer, and one that's struggled to execute of late. He noted the company has been forced to take on a lot of lower-margin business and is still levered to a slowing Europe.

Lightning Round

In the Lightning Round, Cramer was bullish on Solar Capital ( SLRC), Edison International ( EIX) and Cubist Pharmaceuticals ( CBST).

Cramer was bearish on Solazyme ( SZYM).

Executive Decision: Randy Smallwood

In the "Executive Decision" segment, Cramer sat down with Randy Smallwood, president and CEO of Silver Wheaton ( SLW), a company that invests in silver mines. Silver Wheaton's stock is up 900% since it debuted in July 2005.

Smallwood started off by saying he's bullish on all precious metals, but Silver Wheaton has chosen to focus on silver. Unlike gold, silver is often a byproduct of other mines, such as copper and zinc. So while gold mines may slow or stop production as the price of gold weakens, silver is continually being produced unless a number of other metals begin declining.

That said, Smallwood admitted that Silver Wheaton's earnings are indeed tied, in part, to the price of silver. He characterized silver as the "affordable" precious metal. He noted that in much of the developing world the rising middle class cannot afford to own gold, so they choose instead to invest in silver, which is vastly more affordable.

When asked about global demand for silver, Smallwood said that silver is being increasingly used in technology, an area where demand is not as economically sensitive.

Cramer said that while he remains bullish on gold, Silver Wheaton is a great way to invest in silver without taking on the added risk of investing in a mining company directly.

No Huddle Offense

In his "No Huddle Offense" segment, Cramer said when investors think about all the recent merger and acquisition activity as well as all of the chatter about taking companies private and the countless number for secondary offerings, they should be thinking about just one thing... fees!

Cramer said all of these activities generate huge fees, at huge margins, for investment bankers including JPMorgan Chase, Morgan Stanley ( MS) and Goldman Sachs ( GS).

So while investors remain focused on net interest margins and other meaningless metrics, Cramer predicts these banks will trounce the earnings thanks to the fees they will be able to generate from everyone else taking advantage of low interest rates.

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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

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At the time of publication, Cramer's Action Alerts PLUS had a position in CBI, CSCO, GS and STI.

Jim Cramer, host of the CNBC television program "Mad Money," is a Markets Commentator for, Inc., and CNBC, and a director and co-founder of All opinions expressed by Mr. Cramer on "Mad Money" are his own and do not reflect the opinions of 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, 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 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, 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, 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 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, 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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