Cramer's 'Mad Money' Recap: Next Week's Game Plan

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NEW YORK ( TheStreet) -- Be careful, it's no longer easy to make money in this market, Jim Cramer warned "Mad Money" viewers Friday as he laid out his game plan for next week's trading.

Cramer said the market will be awaiting the result of the Federal Reserve meeting that begins Tuesday and ends on Wednesday. The last time the Fed spoke, it was a wake-up call to the markets, he said, and he hopes this time the markets are greeted with more tepid comments. If not, be prepared for more ugliness.

Beyond the Fed on Wednesday, Cramer said he'll also be watching the Empire State Fed survey on Monday, where he expects to see numbers that show the economy can't support interest rates that are as high as they are today. The U.S. is still doing better than the rest of the world, he said, but rates have run too far too fast.

On Wednesday, Cramer will also be listening for FedEx ( FDX) and Micron Technologies ( MU). FedEx will either be praised for great results or obliterated for any signs of global weakness. Micron will offer a read on the state of technology, as just about everything electronic now uses the company's memory chips.

Thursday brings earnings from Kroger ( KR), the grocery chain that's knocking it out of the park with private label products, and Pier 1 Imports ( PIR). Cramer said that he still prefers Whole Foods Markets ( WFM) over Kroger, but expects Pier 1 to do well after Restoration Hardware ( RH) saw huge gains in same-store sales.

Finally, on Friday it's Darden Restaurants ( DRI) and CarMax ( KMX) reporting. Cramer said he wants to hear if consumers are cutting back on eating out and if they're still hot for all things auto.

Profitable Covidian

Breaking up is not only easy to do, it's profitable too, Cramer reminded viewers, as he followed up on a corporate spinoff that's taking place soon. He said shares of Covidian ( COV) are already up 57% since he first got behind the company in late-2011, but now that the spin off of its pharmaceutical business, Mallinckrodt, is at hand, there's still a lot more value to be had.

Cramer explained that Covidian's medical device business has been dragged down by the pharma division, but will almost instantly get a higher multiple as a simpler, easier-to-understand entity. But that doesn't mean shareholders should sell Mallinckrodt on day one, noted Cramer. When Abbott Laboratories ( ABT) split itself into two, both halves soared. Cramer expects the same to happen with Covidian.

Covidian is currently a $66 stock that sells at 15.7 times earnings, noted Cramer. After the split, the two companies could be worth $74, or 12% more than they are today.

Once Mallinckrodt hits $48 a share, however, Cramer said he'd be a seller of the stock, as the newly minted drug company will be faced with more generic competition starting in 2014.

Speculation Friday

For "Speculation Friday," Cramer turned the spotlight onto W.R. Grace ( GRA), a company whose shares have risen 23% so far this year despite the fact that it's been in bankruptcy since 2011.

Cramer explained that Grace was forced into bankruptcy due to asbestos litigation that is now in its final stages. The bankruptcy is a blessing in disguise, however, because many mutual funds aren't allowed to own companies in bankruptcy. That means when Grace emerges as a new company in the fourth quarter there should be a ton of pent-up demand for the stock.

W.R. Grace is a specialty chemical maker made up of three divisions, Cramer continued. Its catalyst technology division makes additives for the oil and refining business as well as for chemical makers. It also has a construction products business and a materials technology segment that is similar to PPG ( PPG) in making coatings.

Grace has always been a best of breed company with tons of pricing power, said Cramer. When it comes out of bankruptcy free of litigation, it will sport a lean balance sheet as well as the ability to offer shareholders a dividend.

How much is W.R. Grace worth? Cramer said adding up all the parts and subtracting the debt yields an $8 billion company, or $105 a share, which is a full 26% higher than where it trades today. Cramer said he expects shares to reach their full potential in just months after the bankruptcy is behind them.

Lightning Round

In the Lightning Round, Cramer was bullish on Lockheed Martin ( LMT), Applied Materials ( AMAT) and Masco ( MAS).

Cramer was bearish on Clorox ( CLX) and First Solar ( FSLR).

Mad Tweets

In the "Mad Tweets" segment, Cramer responded to questions sent via Twitter to @JimCramer.

He said that Usana Health Services ( USNA) is a highly controversial stock and he'd ring the register on this risky investment.

He was also bearish on Clovis Oncology ( CLVS), a drug maker that has run 320% so far this year. Cramer said the company's drugs are still in Phase I testing and investors need to wait for now and he'll revisit the stock later.

When asked about Fairway Markets ( FWM), a red-hot IPO, Cramer said he missed the move in Fairway, but still likes Whole Foods Markets more.

Finally, when asked about Linn Energy ( LINE), a stock Cramer owns for his charitable trust, Action Alerts PLUS, Cramer said that he's standing by his recommendation, even though shares have fallen.

No Huddle Offense

In his "No Huddle Offense" segment, Cramer opined on the notion that Federal Reserve Chairman Ben Bernanke manipulated the markets by making comments Thursday that reversed the trend, sending the averages to a higher close on the day.

Cramer said the Fed is not unsophisticated and knows that its words have an impact on the markets. In fact, influencing the markets is its job, in a way.

In the end, Cramer said he doesn't care who manipulates what because manipulation occurs in both directions. What's important for investors is to know what's working, to get the stocks of great companies at great prices.

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 LINE.

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."

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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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