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NEW YORK (TheStreet) -- Supply is the true enemy of the bull, Jim Cramer told his Mad Money viewers Wednesday. With a deluge of new supply hitting the markets just as demand is waning, we could be in for a rough ride.
Up until now, the markets have been pretty devoid of new share issues, but that trend could be changing, and that has Cramer worried. The markets will either be flooded with shares that no one wants or money managers will be forced to sell what they have to make room for the new merchandise.
Likewise with the coming initial public offering of Etsy, the craft-based online marketplace. With the company's own management stating that it may never achieve profitability, the deal is rather suspect.
Then there are the secondary offerings of shares. Abbott Labs (ABT - Get Report) issued 35 million shares that were not able to hold their price, and no fewer than seven biotech deals also broke down.
All of this adds up to a troublesome market, Cramer concluded. Investors need to be careful.
Executive Decision: Richard Thompson
For his "Executive Decision" segment, Cramer sat down with Richard Thompson, CEO of FreshPet (FRPT - Get Report), the healthy and organic pet food maker that made a splash during its IPO last November but has since stalled -- until today when the company reported with in-line earnings and a 38% rise in revenue.
Thompson said the pet food market is $20 billion a year and he thinks FreshPet is poised to take its share because his company's brightly lit refrigerators are full of healthy pet food that gets the attention of pet owners and sometimes lifts sales of a store's entire pet food aisle.
FreshPet is not without its doubters, Thompson admitted, but everything that's new and disruptive has its doubters. FreshPet has a great team of successful executives that committed to the FreshPet mission.
So just how good is FreshPet's food? Good enough for Thompson to sample it himself on camera. He noted that all the ingredients are sourced locally in Bethlehem, Pa., and FreshPet is already expanding its $30 million plant with another $25 million investment. The same cannot be said for pet foods from China, which Thompson called "undependable."
Time to Buy Into Oil?
Is it finally time to start buying back into the oil sector? Cramer offered his opinion on the price of oil and of the oil stocks.
In the opinion of many oil industry experts, the price of crude has overshot to the downside, and there's real demand for oil at the mid-$40 level. That leads those same experts to see oil eventually settling out above $50 a barrel.
As for the oil stocks themselves, the time to buy may indeed be upon us as there are too many positive things happening in the sector and people have become far too negative.
Investors looking for verification nee only look at the many successful secondary offerings the oil companies have issued in recent weeks. Carrizo Oil & Gas (CRZO - Get Report) issued shares as $45 and those shares are now over $50. Concho Resources (CXO - Get Report) did the same at $112 and shares are now over $118.
Executive Decision: Robert Finizio
In his second "Executive Decision" segment, Cramer sat down with Robert Finizio, founder and CEO of TherapeuticsMD (TXMD - Get Report), a biotech with eight products currently in development targeting women's issues, including menopause.
Finizio explained his company currently has two drugs in Phase III testing targeting women with menopause. He said the current treatments use synthetic hormones and have not been updated since 1990. Despite being a $6 billion opportunity, Big Pharma has largely abandoned this segment, Finizio said. TherapeuticsMD is the only company developing a natural alternative.
When asked about his company's finances, Finizio noted it has only raised $200 million so far and still have $110 million left in the bank, an extraordinary feat given the company has two drugs in Phase III. TherapeuticsMD also has a thriving vitamin business that grew 71% last year, a business Finizio said will provide the infrastructure needed to deliver the company's drugs quickly once approved.
In the Lightning Round, Cramer was bullish on Insys Therapeutics (INSY), Karyopharm Therapeutics (KPTI - Get Report), Starbucks (SBUX - Get Report), Kinder Morgan (KMI - Get Report), HCA Holdings (HCA - Get Report), UnitedHealth Group (UNH - Get Report), McKesson (MCK - Get Report), Applied Materials (AMAT - Get Report), Alaska Air Group (ALK - Get Report), Kohl's (KSS - Get Report), Dillard's (DDS - Get Report), Urban Outfitters (URBN - Get Report) and Agenus (AGEN - Get Report).
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.
Cramer said this portfolio can't have Emerge, Atlas and Linn and suggested selling all three in favor of Bristol-Myers Squibb (BMY - Get Report), Schlumberger and United Technologies (UTX - Get Report).
Cramer once again advised selling the oil companies and adding Schlumberger and Bristol-Myers.
Cramer blessed this portfolio as properly diversified and a good collection of stocks.
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