Gold Prices Ready to Climb Again?
Investors who pay close attention to gold and its related stocks may have noticed that the stocks act as a leading indicator for the metal itself.
When gold prices peaked in December, Cramer pointed out during Tuesday’s “Stop Trading,” gold stocks started pulling back a month before. Now those stocks are rising again, which means—if his theory holds up—gold the precious metal is a buy.
“I want to buy the GLD off the move,” Cramer said of the SPDR Gold Shares ETF , which tracks the price of gold.
Cramer praised Alcoa for buying TransDigm Group’s fastener business, as it gives the company even more exposure to the revving aerospace industry. That and Alcoa’s much-needed aluminum make this the stock to own for investors who want to play this bull market, and it explains why AA is pushing through its 52-week highs.
“This stock is going much, much higher,” Cramer said.
There’s a trend playing out in engine-maker Cummins that the “Mad Money” host has seen before: The stock is pulling back because of investors’ concerns about the company, but he thinks those fears are unfounded. When CMI traded at about $96 a share, the stock dipped to $87 only to later shoot to $120. Cramer thinks that is about to happen again, saying Cummins, presently at $105, will reach the $120 mark in three weeks. The pullback this time, he said, was a result of management being typically conservative on the earnings conference call and analysts and investors overreacting to that.
“This stock is a rocket,” Cramer said, “and the truck cycle is better than I thought.”
Cramer agreed with Morgan Stanley’s upgrade of Apache to “overweight,” saying the company’s business with Egypt would not have a long-term negative impact on earnings. He said that, despite the religious overtones of the protests taking place there, it was still a “pro-economic-growth revolution.”
“I think when the smoke clears, and it is smoke,” Cramer said, “Apache goes dramatically higher.”
Manitowoc is a buy, Cramer said, now that the crane market is rebounding.
Huntington Bancshares , after raising money to pay off TARP and talking about paying a dividend, is no longer a speculative stock, Cramer said. He thinks HBAN is on the fast track to $10.
Cramer’s favorite bank right now, though? That would be PNC Financial . While Bank of America is a good play on the American recovery, PNC delivered the best bank quarter this earnings season, making it “by far” the best stock.
When this story published, Cramer’s charitable trust owned Alcoa, Apache, Bank of America, Cummins and PNC Financial.
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