Cramer's 'Mad Money' Recap: All Is Not Lost
Cramer said the bulls point to J.C. Penney's real estate, as the company owns 426 of its own stores. But Cramer questioned that logic, saying there are almost no buyers for stores as large as Penney, meaning they could sell for a fraction of what the company thinks they are worth.
Cramer was also negative on Penney's new store-within-a-store concept, saying that many of Penney's brands are mediocre at best.
Cramer reminded viewers that no company has a right to exist in retail, just ask the former Litz, Gimbles or Woolworths. With the company's "so what" brands and its confusing pricing, the chain may simply have no reason so exist in today's marketplace.
Upside Surprise Party
Continuing with his "Upside Surprise Party" series of stocks to buy as the markets continue to fall on fiscal cliff worries, Cramer recommended drug maker Amgen (AMGN) , a company with a huge pipeline of new drugs on the way and a 1.7% yield.
Cramer said Amgen is predicted to double its earnings per share over the next eight years and recently delivered the "triple play" of earnings, including a 20-cent-a-share earnings beat, a 9.5% rise in revenue and upside guidance. After the release, shares rose sharply higher, but have since fallen 6.3% with the broader markets, despite doing everything right.
Cramer said Amgen is the type of stock that will lose less as the market falls and gain more when it recovers. The company's drug for abnormally high cholesterol, AMG145, could be a $2.5 billion opportunity for the company. Amgen also has a substantial stock repurchase program and plans to grow its dividend over time.
Trading at just 12 times earnings with a 10.5% long-term growth rate, Cramer said he's never seen Amgen trade as low as it is right now.
In the Lightning Round, Cramer was bullish on Isis Pharmaceuticals (ISIS) , Southwestern Energy (SWN) , American Capital Agency (AGNC) , CenturyLink (CTL) , AT&T (T) , Verizon (VZ) and Kinder Morgan Energy Partners (KMP) .
In the "Executive Decision" segment, Cramer sat down with Robert Carr, chairman and CEO of Heartland Payment Systems (HPY) , our nation's fifth-largest payment processor. Heartland's most recent quarterly results included a 5-cent-a-share earnings beat on better-than-expected revenue with upside guidance.
Carr explained Heartland currently services 250,000 merchants and is the company at the other end of the phone when merchants call in to process a payment. He said his company authorizes the transaction and then pays the merchants in the days that follow. Heartland started as the 62nd largest processor in the country and has risen to No. 5 in just 15 years.
Carr also discussed the 2009 incident where hackers penetrated Heartland's systems, along with 300 other companies. He said Heartland responded quickly and afterward introduced end-to-end encryption for transactions so hackers can no longer cause similar damage. They also created an industry group to share security information to help the entire industry better protect itself.