Stocks discussed in the in-depth session of Jim Cramer’s Mad Money TV program, Tuesday March 20. Click on a stock ticker for more analysis:
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For Cramer's Back to School show at McCombs School of Business at the University of Texas at Austin, Cramer discussed his four favorite Texan stocks. First was JCP, "the best and most consistent retailer in the country," which has been unfairly "hammered" after executives admitted the product mix needed alteration. Second was RIG, the "biggest and among the cheapest" drillers which lacks exposure to the weak markets in the Gulf of Mexico and Canada but has the freedom to raise rates because of intense demand. Cramer also mentioned XTO which he would buy aggressively because it uses reserves efficiently and knows how to trade oil. In addition, XTO has 12% reserve growth, unlike other oil stocks. Cramer's favorite Texan pick is TIN which, aided by Carl Icahn's influence, is finally going to break up and is due for "27 points of upside." Cramer would buy any of these stocks "right here, right now."
While Cramer thought one student's question about Cisco was challenging, since the stock has moved from $18 to $29, he answered, "When you have a best in show stock like CSCO, you can't give it up." He recommended holding Cisco and buying more if it fell below $25. While Cramer says he respects Michael Dell, he adds the fundamentals of the industry have changed and others have stolen Dell's model; "Fabulous company, not a great stock." While Cramer likes water pumping as a concept, he doesn't see how a company like ITT can make money.
CEO Interview: William R. Johnson, HJ Heinz (HNZ)
Cramer invited McCombs School of Business alumnus, William R. Johnson, onto the show and asked whether HNZ is a good defensive play or whether the Chinese and Japanese are going to put their ketchup brands on the table. "No, we have our bottles on their tables," said Johnson. When asked if the company was nervous about shareholder like Nelson Peltz showing up unexpectedly, Johnson replied that it is natural to resist a boss when the company's many "bosses" are their consumers, but added, "It's a normal resistance, but it's a mistake because these guys do bring value." He also identified "innovation" as the HNZ's theme and Cramer gave the company a triple buy, commenting Heinz "defines the most defensive business possible."
Students from McComb's MBA Investment Fund pitched their stocks to Cramer. The first student touted SLB as a value pick, which was down but would come back on macroeconomic trends and the high price of oil. Cramer commented the student was "dead right," and while the stock isn't cheap "sometimes you've got to pay a premium for a great stock ... I would buy it aggressively." A second student liked BRCM because of its diverse product portfolio, accelerated revenue growth and improved inventory management. She added its options backdating problems are behind it, because of its clean balance sheet. While Cramer agreed with her fundamental analysis, he would put BRCM on hold until August because he doesn't like tech here. A third student said Wal-Mart management is "finally focused on what it needs to do" and is a stock people will be satisfied with in 12 to 18 months. While Cramer has been bearish on WMT, he told the student he would visit three Wal-Mart stores in 72 hours before makng a decision.
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