In an uncertain health care market, one biotechnology player stands out to Jim Cramer as a "rare island of calm" that is shaping up to be a prime takeover target: Agilent (NYSE:A).
With low debt, lots of cash on hand, strong fundamentals, and plenty of overseas exposure, the "Mad Money" host said Agilent has "exactly the kind of profile investment bankers look for when they pitch potential takeover targets to their clients."
But who would acquire the high-tech medical measurements maker?
"I can think of one potential suitor that would be a perfect fit," Cramer said. "General Electric (GE)."
The multinational's life sciences division makes similar products to Agilent, and if GE wanted to expand into health care, Agilent represents a near-bottom buy despite its dramatic upward move.
"I think the stock either goes higher thanks to its strong fundamentals, or it spikes on a takeover bid from someone like GE," Cramer predicted.
Not all's well in the world of health care, however. In light of the House of Representatives postponing the vote on the Obamacare replacement, Cramer laid out his best and worst case scenarios for whatever happens with the bill.
Cramer said the GOP's bill passing would likely strengthen President Donald Trump , who supports the bill, giving him leeway to implement tax and infrastructure reform.
"The result? Stocks rally and interest rates go higher," Cramer said. "The best stocks to buy in this scenario? The banks, because they've been headed down for some time on sinking interest rates. They need those rates higher. I'd snap up JP Morgan (JPM) or Cramer-fave Citigroup (NYSE:C)."
In the increasingly likely case that the bill does not pass the House, Cramer's advice might seem counter-intuitive: "buy the heck out of the market, right into the teeth of the downturn."
In that case, Cramer suggested picking up high-yield names like American Electric Power (AEP), Pepsico (PEP), Eli Lilly (LLY), and Allergan (AGN), as well as high-growth stocks that perform well without a strong economy like Adobe (ADBE), Oracle (ORCL), and the FANG stocks - Facebook (FB), Amazon (AMZN), Netflix (NFLX), and Google parent Alphabet (GOOGL).
The key is not to panic, Cramer insisted, "because no one ever made a dime panicking."
Cramer also spoke with Ionis Pharmaceuticals (IONS) CEO Dr. Stanley Crooke on Thursday, who responded to Goldman Sachs' (GS) hard-hitting downgrade of the drugmaker because of discontinuation, safety, and toxicity issues of its medications.
"I think that's just wrong. First of all, we identified no specific safety signals, and probably the best evidence for that is that the FDA approved the drug in a record time of about 3 months with the broadest label possible," Crooke said, referencing Ionis' spinal muscular atrophy drug Spinraza.
Crooke contended that Ionis is also welcoming transactions with a number of major health care players like Biogen (BIIB), GlaxoSmithKline (London Stock Exchange: GSK-GB), Novartis (Swiss Exchange: NOVN-CH), and Johnson & Johnson (JNJ).
"I would say that it would be very difficult to make the case for those folks to invest knowing everything going on in the company if all of our drugs were going to fail and our toxicities were a big problem," Crooke said.
Meanwhile, it's no secret retailers are struggling, which is why Jim Cramer thinks the market jumped on Five Below's (FIVE) 1 percent same store sales growth, pushing the stock up over 10 percent on Thursday.
The teen-targeting discount chain's "fun and experiential" spirit is what helps it pull in shoppers even as the rest of its sector fails to do so, and what made its 1 percent growth shine in a low-bar environment, Cramer argued.
And if you are worried about the risk of a potential border tax, the company even has a solution for that.
"Even here there's a glimmer of hope, as management believes there would be a low-dollar exemption for imports," Cramer said. "If that's the case, then Five Below will become one of the go-to names for retail in 2017."
Finally, Jim Cramer turned to technician and currencies expert Carly Garner's charts for a closer look at the euro, which looks poised to make a comeback.
Cramer's been burned by currency betting before as a hedge fund manager, when the Berlin Wall fell while he was out to lunch and sent currency markets into a frenzy.
"I sure didn't have it my way," he recalled. "That said, I believe the euro is headed higher and the safest way to play it is with the FXE (NYSE Arca: FXE), the ETF that reflects the euro to dollar exchange rate."
If exchange-traded funds are not your cup of tea , Cramer suggests playing the prospective rally by investing in U.S. companies that do business in Europe, since a strengthening euro means more dollars coming from European earnings.
"I think Alphabet (GOOGL), parent company of Google, may be your best bet as it's down on a story about lost advertising dollars that I believe will be remedied rather quickly ... and it won't be nearly as impactful as the press indicates," Cramer said. "Alphabet has a gigantic business in Europe."
In Cramer's lightning round, he rattled off his take on two caller-favorite stocks:
Ford Motor Company (NYSE:F): "The stock Ford is too hard for me to own, frankly. They're going to miss the quarter again, and at a certain point we just have to say, enough. Okay? Just, enough."
Constellation Brands (STZ): "It's an interesting point [that beer drinkers are switching to marijuana], you know, because some of the big states did legalize [marijuana], but I still think that beer sells well. We're looking at the aggregate numbers, and Constellation sells best, because it's Modelo (:GMOD-MX) and Corona and I know this to some degree from Bar San Miguel, my own tavern. But I will tell you this: I am worried about the border tax, but I'm not backing away from Constellation. I think that this will be resolved and not against Constellation's way."
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