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Stocks discussed on the in-depth session of Jim Cramer's Mad Money TV Program, Thursday October 25.

CEO Interview: Chris Viehbacher, Sanofi-Aventis (SNY)

While many are worried about the fiscal cliff, pharmaceutical companies are concerned about the patent cliff, the deadline when their drugs lose patent protection and are vulnerable to competition. Intelligently-managed companies see this coming, and prepare for it through diversification. Sanofi-Aventis (SNY) was ready for its own patent cliff by diversifying into animal health, vaccines and diabetes treatments. The stock yields 3.8% and has risen 13% since Cramer got behind it in September of last year. CEO Chris Viehbacher discussed the company’s expansion into emerging markets through acquisitions; “I prefer to be where others aren’t.” He discussed the fact that the importance of animal health is “chronically underrated,” since consumers will spend a great deal of money to make sure their pets are healthy. The company has a diabetes drug and is making moves into the orphan drug market. The CEO said, “There are 7,000 rare diseases and we only know how to treat 300 of them. There is a huge amount of work to be done.” He thinks that “safety issues are overblown” in these clinical trials, because those suffering from rare diseases are not as concerned with risks but want to be cured, unlike someone with the common cold. Cramer likes SNY’s yield and thinks the stock isn’t done going higher.

CEO Interview: John Faraci, International Paper (IP)

What should investors think about a strong company that didn’t make its numbers? International Paper (IP) has been a consistent performer, diversifying away from paper and into packaging goods, spinning off non-performing assets, raising its dividend and making valuable acquisitions, like Temple Inland. IP missed earnings estimates by 2 cents and reported light revenues, which grew only 15.9%. The stock got punished not only because of lackluster earnings, but because it had run up going into the quarter. CEO John Faraci says he is pleased with business, particularly the $300 million Temple Inland merger, which has been integrated in only 9 months when the target time was 2 years. “I think by this time next year, we will be optimizing the business, not integrating it.” John Faraci discussed the fact that the company has not increased prices in over two years and his optimism that the slowdown in China, which is affecting IP, is a trend that will reverse once China’s economy improves. Brazil has been a strong market for International Paper; it recently acquired 75% of a Brazilian paper and packaging company and has a strong presence in Mexico. Faraci predicts that the holiday season will be stronger for IP than it was last year. Cramer thinks IP is a reliable, cost-cutting company that delivers a good yield.

CEO Interview: Abhi Talwalkar, LSI Corporation (LSI)

LSI is a company that missed its earnings and revenues and guided down, and yet the stock rallied 7.6%. How did this happen? Cramer pointed out that expectations were so low going into the quarter, that the company’s report was actually better than expected by investors. The stock was down 20% in the 6 weeks prior to earnings. LSI is a semiconductor company specializing in storage and networking, and is moving into cloud and data. CEO Abhi Talwalkar said that telco spending is stronger than many believe and he thinks that while tech has been down, “it is in for a strong cycle.” The CEO discussed the proprietary nature of the company’s technology, since it has been in the networking and storage business for 20 to 30 years. The company has been buying back stock aggressively, and when Cramer asked if LSI might offer a dividend, Talwalkar replied, “It is a question of when and not if.” He noted that the market is growing 40-50% “and we are outgrowing that market.”

Cramer would recommend buying LSI for those who agree with Talwalkar and think tech has bottomed.

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Source: Cramer's Mad Money - Fiscal Cliff Or Patent Cliff (10/25/12)