Speculating on Science

It’s Speculation Friday, and Cramer’s got two great medical stocks to recommend. The first is Kinetic Concepts, which focuses on wound care and therapeutic surfaces. This $3.2 billion company gets 78% of its sales from the wounds business, mainly because KCI has proprietary treatments like its vacuum-assisted closure therapies. You never want anything in the medical space that isn’t proprietary, Cramer says, so KCI might make a good pick. The other side of the business makes specialty hospital beds, mattress replacement systems and overlays for wound care, lung care and treating the obese.

The threat of increased competition in the wounds business is what makes KCI a speculative stock. It turns out that the Centers for Medicare & Medicaid Services has put KCI’s therapies on a list of those up for competitive bidding. Timid analysts fear the company will be underbid, but Cramer’s pretty confident. He says KCI has enough advantages to defend its market share.

Cramer’s prediction is that KCI will either maintain its pricing prowess or the market will realize how small a part these therapies are to KCI’s overall business. That should get the stock price back up.

Bottom Line: Kinetic Concepts is probably going higher. If you’ve got a speculative slot open, you should consider filling it with this one. Pick number two is coming up next.

Questions? Comments? madmoney@cnbc.com