Cramer thinks there is one stock in particular that has become somewhat of a recession bellwether: Medco Health Solutions . This company has the “single most consistent earnings pattern of this era,” Cramer said, and he got CEO David Snow on the line to explain to Home Gamers why Medco is so important.
Medco benefits when pharma companies have drugs that go generic. “Medco is hired by its customers to save them money and the best way to do that is to move patients from branded drugs to equivalent generic drugs,” Snow said. “When we move them, we get paid.”
There is $60 billion worth of brand drugs that are going generic between now and 2012. That leaves a very visible earnings picture ahead for Medco, - a “clear line of sight,” according to Snow - which is the company’s most valuable attribute in this uncertain time, Cramer said.
In addition, Medco’s mail order distribution – already the largest on the planet – will continue to grow, Snow said. Receiving medication through Medco’s mail order system is “convenient, clinically safer and the costs are lower,” Snow said, because of the robotics the company conceived and uses.
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