Cramer: 9 Stocks That Work Right Now

How do we value stocks today versus where they were a year ago?

“That’s the defining issue of this stock market,” Cramer said during Thursday’s Mad Money.

No doubt our situation’s improved from fall 2008. Housing inventory is down, and pricing has stabilized. Credit-card delinquencies seem to have already peaked, and retail sales are better than expected. And, yes, no matter what you hear, the crash is in the past.

So the averages deserve to be higher because many segments of the economy are better. But we haven’t rebounded so much, Cramer said, that investors “should be paying up dramatically.” And we are up dramatically, given the 30% year-over-year increase in the S&P 500.

Given this not-hot-but-not-cold-either environment, Cramer said, a drop in the Dow and S&P like we saw today is the market “struggling to figure out whether we’re actually one-third better than last year.” Of course, this kind of indecision makes it hard to use a generalized strategy to stock buying right now. So Cramer recommended taking a case-by-case approach.

He told Mad Money viewers to buy stocks that aren’t up year-over-year but should be. McDonald’s , Nucor and UPS are strong businesses that deserve better share prices than they have right now, Cramer said. Also, Deere and Monsanto could go higher, as could dry-bulk carriers like Diana Shipping and tanker companies like Nordic American .

Investors, though, should avoid any stocks that have ramped higher than the averages, unless they’re part of a secular growth trend like the mobile Web, such as Google and Apple .

As confusing as this market may be, Cramer said he was excited by Thursday’s declines rather then frustrated by them. Investors should be, too.

“It lets you get the stocks you want at your prices,” Cramer said, “not the ones set by the desperate momentum chasers.”

Cramer's charitable trust owns UPS.

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