Mad Money

After investigation, detective Cramer discovers 9 buys

Tremendous failure of imagination: Cramer

(Click for video linked to a searchable transcript of this Mad Money segment)

Investing is a bit like an Ellery Queen novel. There are plenty of clues out there. You just have to know where to look.

And Cramer says the spate of retailers that just reported earnings are providing a slew of clues that should lead investors to what which they are seeking – stocks with upside.

Clue #1 - Most retailers underperformed their plan.

"We know that most retailers had either low single digit comparable store sales or negative comps," Cramer explained.

A good stock detective should now circle back and look for companies that outperformed on this metric.

"For me that's Costco, Starbucks and Williams Sonoma. They did the best of any of the major retailers I follow. I think they are a terrific place to be."

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Clue #2 - Retail sales suggest the consumer is tight-fisted

Interrogate the industry. Ask yourself which companies do well, when consumers are even more price sensitive than usual.

"Companies that make private label store brand products seem like a beneficiary," speculated Cramer. I'd think Perrigo wins from the trend."

Cramer also says frugal consumers could turn to Amazon, which tends to be very competitively priced. And he believe anyone short of cash may stay at home and watch videos on Netflix. Both stocks, he says, warrant attention.

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Clue #3 Some items are selling well

"Best Buy says the Chromebook is selling well," Cramer noted. "It's another reason to buy Chrome's parent, Google."

"Meanwhile Home Depot says appliances are selling incredibly well. That's a good reason to establish a position in Whirlpool the nation's largest washer and dryer manufacturer or Jarden which makes so many of the smaller appliances," Cramer added.

All told, Cramer sees opportunity despite some disappointing results. "It doesn't take a genius to find these terrific ideas," Cramer said. "But it does take some leg work.'

Call Cramer: 1-800-743-CNBC

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