The shorts and panicked sellers have a “buffett of horribles” to choose from, Cramer said Tuesday, to try to knock down this market. But that’s no reason to sell and run.
Whether it’s Europe’s debt problems, a government-induced slowdown in China or falling oil prices, the bears have harped on any negativity they could find to hurt stocks. They’ve been jumping all over financial regulation, the failed car bombing in New York’s Times Square and the Australian mining tax, too.
But while Cramer admitted that Europe would continue to weigh on investors, and they’ll have to let it play out, he still thinks there are plenty of opportunities in this market. Here are his top 10 right now:
1. Drug companies are very cheap right now. He likes Abbott Laboratories for its growth and 3.4% dividend yield.
2. You can buy the foods as well, with General Mills being the best among them. Cramer didn’t think the company would split its stock unless the business was strong. In the private-label space, consider Perrigo.
3. Look out for dividend plays. Cramer recommended Inergy and its 7% yield, saying the propane retailer reported a great quarter today.
4. Natural gas should get another look after BP’s Gulf of Mexico oil spill and Massey Energy’s coal mine explosion. Think Atlas Energyand National Fuel Gas here, Cramer said.
5. Utilities look good as capacity utilization picks up. Cramer’s favorites? Duke Energy and Dominion Resources.
6. Nike, going into its first analyst meeting in three years on Wednesday, is a buy.
7. You can always fall back on earnings winners, too, such as Starwood Hotels .
8. Walmart and Costco have been ignored because they’re focused on consumer staples, but Cramer predicted good quarters ahead for both companies, especially COST.
9. Sprint Nextel right now is a great speculative play, as is Motorola . Cramer reminded viewers of Sprint’s strong most recent quarter.
10. For those with a longer-term view, the industrials that just reported notable earnings – Boeing , 3M and DuPont – are at the beginning of their run.
Now, here’s how you play it: Cramer thinks these 10 areas should hold up for the rest of the week. So if you’re in for a trade, consider buying them mid-morning on Wednesday after the American markets shake off their daily dose of Europe’s troubles. Investors looking to hang in there should buy at the same time, but specifically go after those top earnings performers.
Right now, Cramer said, they offer “entry points that you wouldn’t have dreamed of getting as recently as five short days ago.”
Cramer’s charitable trust owns Abbott Laboratories, BP and Costco.
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