Defense for Democrats

Orbital Sciences reported a fabulous earnings beat, and Cramer said the stock is a buy.

But not yet.

Orbital’s among the group of companies that wowed Wall Street with its most recent quarter. So far this week Cramer’s called out Jones Apparel and Tyco from this cadre, too. The problem, though, is that they’re all up since the report, so they can’t be bought right now. Luckily for investors, Cramer’s giving them the exact price where it makes sense to jump in.

Back to Orbital. This is an aerospace and defense company that makes rockets and space systems (think satellites and launch vehicles), and it’s number one in five of the six markets it serves. Orbital also has one of the best growth rates of any company in the sector at 17.5%, and Cramer said a number like that will get a higher multiple in this new low-inflation environment.

Now the earnings beat: Orbital delivered 12 cents more per share than the Street’s expected 23 cents – a 52% upside surprise. The company also raised its full-year profit guidance and reported a $4.2 billion backlog. That’s 2.7 times the size of the entire market value of the company. Take that Raytheon and L-3 Communications.

Cramer likes Orbital as a play for the Democrats, who are traditionally thought of as less vigilant when it comes to defense, because the company doesn’t make the typical tanks and guns. And if the Dems take the White House in November as expected, it could be good news for ORB. In fact, Cramer suggested you buy it on any weakness that results from a decline in the polls for Obama. That’s how levered to the Blues he thinks Orbital is.

There’s a catalyst here, too. Namely $2 billion in outstanding bids, including one possibly coming in November that would involve cargo transporting supplies to the International Space Station.

If things take a worse for some reason – as we’ve learned in the very least this past year, all markets turn down eventually – Orbital has plenty of cash laying around to initiate a new buyback, thereby providing the stock with a nice safety cushion.

So what’s the right price for ORB? $24, Cramer said. It’s a buy at that level. Of course, there’s a chance Orbital won’t drop that far – it’s at $26.80 now. If that’s the case, then Cramer recommended taking a pass and looking for a new way to make money.

Questions for Cramer?

Questions, comments, suggestions for the Mad Money website?