Jim Cramer reminded investors on Monday that when high-quality stocks go lower, they get cheaper. That is exactly how he feels about Allergan, the acquisitive drug company formerly known as Actavis.
Allergan's stock has been slammed recently, but Cramer thinks the story behind this company could be even better today than it was before. The FDA recently approved Allergan's new anti-psychotic drug, Vrylar, and the company has lined up even more acquisitions to grow its business, including the $300 million AqueSys deal earlier in the month.
Additionally, Allergan is in the process of selling its generic drug business to Teva for $40.5 billion, and if the transaction is approved by the regulators, it could give Allergan enough cash to make yet another transformative acquisition.
"This stock has powered higher year after year, and every time you have bought it into weakness, it has ultimately made you a killing," the "Mad Money" host said.
Biotech stocks were hit hard on Monday when a tweet from presidential candidate Hillary Clinton said that the price gouging by drug companies should be stopped, and would lay out a plan to stop it. If Clinton becomes president, should drug companies like Allergan be worried?