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Stocks discussed on the in-depth session of Jim Cramer's Mad Money TV Program, Wednesday July 18.

CEO Interview: David Cody, Honeywell (HON). Other stock mentioned: Cummins (CMI)

Honeywell's (HON) outstanding performance on Tuesday demonstrated the principle of how a stock can rally when the negativity plays itself out. Cummins' (CMI) awful pre-announcement brought down industrials, but Honeywell proved the bears wrong with its 3 cent earnings beat and raised guidance. Strength in aerospace and technology for oil and natural gas refiners were the segments that drove Honeywell's 6.76% rise.

On rumors that aerospace might have peaked, CEO Dave Cody says he "is not buying it," given the advance orders the company is seeing. Cody aims to further develop technology for oil and natural gas refining, and sees the adoption of natural gas as a primary fuel that will generate growth for the domestic economy. The government might not have to support natural gas production, but it should avoid over-regulating it, Cody said. There needs to be a mutual agreement about regulations on drilling, but this agreement should be made as soon as possible. China has been an extremely strong market for Honeywell, with double digit growth. Cody thinks Europe's economy will be flat for the next 5 years.

"Congratulations for busting the gloom," Cramer told Cody, and his advice to investors; "Don't trade Honeywell. Just own it."

Intel (INTC), Microsoft (MSFT), EMC (EMC), Stanley Black & Decker (SWK), Bank of America (BAC), JPMorgan (JPM) Wells Fargo (WFC), HSBC Holdings (HBC), Pulte Group (PHM), D.R. Horton (DHI), Toll Brothers (TOL), VMware (VMW), Salesforce.com (CRM), F5 (FFIV), Red Hat (RHT)

With the Dow up 150 points, the market is seeing a well-deserved rotation into the most-hated sectors. Industrials and techs were up, because they had been so beaten down that any piece of good news moved the stocks. Even companies that reported shortfalls did not necessarily see their stocks decline, because expectations were so low. There was extreme negativity about Intel (INTC) going into earnings. In spite of some tepid numbers, the company's management was bullish about the 4th quarter, and gross margins were positive. While Intel initially sold off on the headlines, the stock reversed and went higher. Cramer said last Friday that if Intel's stock rose after earnings, that would be a clarion call to buy tech. The result was that PC related stocks, like Microsoft (MSFT) rallied.

EMC (EMC) has been dragging for a while, but it rallied 9.4%. There was pin action, as Salesforce.com (CRM), Red Hat (RHT) and F5 (FFIV) all rose.

Stanley Black and Decker (SWK) got hammered at first after a terrible shortfall, but recovered with the brighter news about housing. Honeywell brought up the sluggish industrial sector following its report; "I'm giving Honeywell a gold medal," said Cramer.

Banks had a setback when Bank of America (BAC) failed to beat rather low expectations, since it didn't have the revenue growth. However, Cramer thinks the worst is over for JPMorgan (JPM).

Cramer took some calls:

HSBC Holdings (HBC) is facing a money laundering scandal. Cramer prefers JPMorgan and Wells Fargo (WFC).

Pulte Group (PHM) and D.R. Horton (DHI) are not Cramer's favorite housing plays, but they should see some upside. Cramer would buy a better stock, Toll Brothers (TOL) and go "down the food chain" as the housing recovery continues.

VMware (VMW) has been performing well, but Cramer would rather buy EMC.

Execute Or Be Executed: Infosys (INFY), Informatica (INFA), SAP (SAP), Accenture (ACN), IBM (IBM), Symantec Corporation (SYMC)

In a tough environment, it is easier to distinguish between companies that are executing and those that are not. Companies that are not executing are quick to blame poor performance on external factors, but if other companies with the same challenges are showing strong numbers, it is clear that the sluggish company is the author of its own sad fate.

Infosys (INFY) reported its 3rd disappointing quarter in a row, and blamed slashed budgets for IT spending and slow growth in Europe. INFY dropped 11% in one day. However, SAP (SAP), which should have the most to complain about concerning Europe, since it is located in Europe, pre-announced that sales on the Continent were strong, and reported double digit growth and 18% revenue growth. SAP also reported that its financial business was solid, while INFY blamed its financial segment for some of its problems. INFY has moved from giving quarterly guidance to annual guidance; this is a bad sign, since it demonstrates that the company has little visibility about future earnings. INFY's services had premium pricing, but competition from Accenture (ACN) and IBM (IBM) means that INFY has to cut its prices to stay competitive. Informatica (INFA) also gave disappointing numbers, and is another company that is failing to execute. "Maybe it is only raining on INFY's side of the street," said Cramer. SAP is clearly demonstrating its ability to perform well in hard times, and is a buy.

Cramer took some calls:

Accenture beat expectations, and with IBM's rosy picture, it is unclear why ACN's stock hasn't risen. Cramer thinks ACN will make the move higher to above $60.

Symantec Corporation (SYMC) is a value trap; "If it isn't making money now, I don't know when it will," said Cramer. For cybersecurity, Cramer would buy Intel, since it owns McAfee.

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Source: Cramer's Mad Money - Honeywell Busts The Gloom (7/18/12)