Jim Cramer's 'Mad Money' Recap: This Is Why Apple Rules

 

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NEW YORK ( TheStreet) -- What other company can meet and unmet demand and create a global publicity storm in the process? Only Apple ( AAPL) , Jim Cramer said on  Mad Money Wednesday.

Cramer said Apple, a stock he owns for his charitable trust, Action Alerts PLUS, has become the poster child for giving customers what they didn't even know they needed, and yesterday the company did it again with an iPhone-based payment system and a health-tracking "smart" watch.

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Only Apple could assemble a critical mass of stores, restaurants, ecommerce companies and credit card processors to make paying with your phone finally a mainstream activity, Cramer said, and only Apple could devise a watch to track your health and display notifications in a way that you'd actually want to wear it.

But Apple isn't the only company meeting unmet needs, Cramer continued. Deckers Brands (DECK) reinvented the dress shoe with Rockport and is now working on running and yoga footwear.

GoPro (GPRO) is another company meeting the unmet desire to capture all sorts of action sports, while Twitter (TWTR) , another Action Alerts PLUS name, is meeting our daily, hourly and sometimes constant need for the latest news updates.

Others, like Google (GOOGL) , also an Action Alerts PLUS holding, meets our needs for information while Keurig Green Mountain (GMCR) fills a need for a quick and easy cup of joe.

Cramer said all of these companies are innovators, and all have been rewarded with higher share prices.

Mind Your Metrics

Always know what makes your stocks go up and down, Cramer told viewers. Every stock has a certain metric to which it is tied, and that metric makes all the difference.

In the case of EOG Resources (EOG) , that metric is simply the price of oil. Other metrics, like production and reserves, are important when gauging the health of the company, Cramer said, but when it comes to the day-to-day price of the stock EOG trades will the price of oil.

Banks, on the other hand, trade on interest rates. When rates are rising, banks make more money and see their stocks soar. When rates fall, so do their stocks.

Cramer reminded viewers the markets are dominated by exchange-traded funds, and that means that many stocks are lumped together into baskets and trade together.

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Now is the time to start investing in the oil patch, Cramer concluded. The price of oil may still fall but when it turns it will turn sharply. He suggested a company like Royal Dutch Shell (RDS.A) , another Action Alerts PLUS fave, which is doing well and has a solid dividend that pays you to wait for that turn to happen.

Safety in Cyber Security

With high-profile data thefts becoming a common occurrence, Cramer said it's once again time to take a look at the cyber security stocks. Once niche players, these security companies are becoming mainstream and are among the fastest growing companies out there.

Cramer said his favorite remains Palo Alto Networks (PANW) , a company that's proven it has the best technology. Shares rallied 10% in today's session on another strong quarter.

Next on the list was Fortinet (FTNT) . Cramer said this company's unified threat management system is in high demand, yet the company's stock still trades at a discount. He sees shares topping $30 in the near future.

FireEye (FEYE) is often asked about, Cramer said, but is not a favorite. The stock is down 20% for 2014, despite the company's broad portfolio of products and its accelerating growth.

Finally there's Symantec (SYMC) , a company that's lagged the industry for years, but might be entering a turnaround situation. Cramer said this stock trades at just 12 times earnings.

Executive Decision: Mark McLaughlin

For his "Executive Decision" segment, Cramer continued his cyber security theme by speaking with Mark McLaughlin, chairman, president and CEO of Palo Alto Networks, a stock that's up 34% since Cramer last checked in back in June.

McLaughlin said Palo Alto's technology helps to both detect and prevent bad things from happening to enterprise-level networks. He said the company's award-winning products are disrupting the cyber security business with a new way of detecting attacks.

McLaughlin said that just last quarter his company was able to reduce the time attacks went from "unknown" to "known" status from 28 minutes to just 15 minutes. In a world where attackers move fast, the speed at which you identify breaches is critical, he noted.

When asked about the business overall, McLaughlin noted that everyone needs to do more to protect their customers and data but the important thing is that more attention is being paid to the subject. With so many high-profile data breaches, people are expecting more from the companies they do business with.

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Cramer said it's easy to see why Palo Alto Networks is his favorite in the group.

Lightning Round

In the Lightning Round, Cramer was bullish on Baker Hughes (BHI) , Flextronics (FLEX) , Seattle Genetics (SGEN) , Isis Pharmaceuticals (ISIS) , Xerox (XRX) and Sysco (SYY) .

Am I Diversified?

In the "Am I Diversified?" segment, Cramer spoke with callers and responded to tweets sent via Twitter to @JimCramer to see if investors' portfolios have what it takes for today's markets.

The first portfolio included Bristol-Myers Squibb (BMY) , Duke Energy (DUK) , Gilead Sciences (GILD) , General Motors (GM) and McDonald's (MCD) .

Cramer suggested selling Bristol Myers and adding an oil stock like Royal Dutch Shell.

The second portfolio's top holdings included Google, Amgen (AMGN) , UPS (UPS) , Exxon Mobil (XOM) and Bank of America (BAC) .

Cramer said "Wow!" because this portfolio was perfectly diversified.

The third portfolio had General Electric (GE) , Kinder Morgan (KMI) , Republic Services (RSG) , Sysco (SYY) and Verizon (VZ) as its top five stocks.

Cramer was also a fan of this diversified portfolio which also had great yield.

The fourth portfolio's top stocks were Gilead Sciences (GILD) , Regeneron (REGN) , Home Depot (HD) , Apple and Arista Networks (ANET) .

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Cramer said one of the biotechs needed to be sold, as did Arista, to make room for oil stock and a chemical company like Dow Chemical (DOW) .

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

To sign up for Jim Cramer's free Booyah! newsletter with all of his latest articles and videos please click here.

-- 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, BAC, DOW, GM, GOOGL, KMI, RDS.A and TWTR.

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