"THE VALUE GAME"

Cramer calls these stocks, "low risk and high reward".  I don't know about you, but that what I like to hear.

He went on to say that value stocks are valuable in their own special way.  All are trading near their 52 week low.

Lear Corporation LEA 

Lear is "the last man standing in the auto supply business".  He said that people have been buying other, more troubled companies.  However, Lear has cash, and what do we say?  That's right.  Cash is king.  SO they are in a position to buy up smaller, troubled companies to become (cue horns!) AN AUTO SUPPLY EMPIRE!!

(someone tell the horns to quit it)

The bottom line is that Lear is a value stock because it's been in a terrible sector. That sector is now bouncing back, and Lear has been left behind.

It is not sexy or a company that you will take about at a cocktail party.  But Jim says this one will make you Mad Money. 

St. Jude Medical, Inc. STJ

Cramer valued Lear because Lear is in a position to consolidate.  The next stock Jim likes, St. Jude Medical, is a company that is likely to be consolidated.

On paper, there in nothing wrong with this company.  However, it has underperformed and people don't care for it.

Its rival is Boston Scientific.  They have had some problems with one of it's devices, leading to recall recently.  This may  be a reason why St. Jude is getting hit, sector-wise. 

Cramer thinks that "Jude's is cheap for a bad reason and it will come back up because a bigger fish is going to come along and take it over."

He think the company that is likely to buy it is Johnson & Johnson.

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Fortune Brands, Inc. FO

Another company down for a bad reason is Fortune Brands.  Their main business is in the home products business. 

"But the housing market is slow! Wahhh!"

Most people do not know that the faucets and cabinets they sell, they sell to home re-modelers and other professionals.   Down for a bad reason.  They did not do their homework.  But we do, right?

"Fortune Brands is doing a 10-million-share buyback, which keeps the stock from going too low and makes the stock more valuable by increasing the earnings per share"  Cramer said.

"The value here is that management knows how to take care of you if you buy the stock," Cramer said. "It should turn into a house of pleasure from a house of pain as people see its great quarter coming."