Transocean Inc. and Halliburton Co. (HAL:US) are the two best investments in the oil industry, Jim Cramer said on his ``Mad Money'' television program on CNBC.
Transocean, a provider of deep-water oil rigs, stands to gain as contracts expire and it's able to raise rates, according to Cramer, a market commentator and former hedge-fund manager. The company ``could be merged into a bigger entity'' and will be even more undervalued March 16 after options contracts expire, he said.
Halliburton, an oilfield services company, is the second- best stock pick in the industry, Cramer said. It will gain from moving to Dubai as it is able to win contracts denied because of a perceived connection to the Bush administration, he said. Cramer recommended against tendering shares for stock of the KBR subsidiary Halliburton is spinning off.
Cramer's other top three oil-industry stocks were National- Oilwell Varco Inc., the biggest maker of oil rigs; Schlumberger Ltd. (SLB:US), an oilfield services company; and GlobalSantaFe Corp., which he called ``one of the premier deep-water drillers.''
He recommended against buying shares of Nabors Industries Ltd. (NBR:US) and said the only integrated oil company he recommended was BP Plc (BP/) because there's more money to be made in drilling for oil.
In response to a caller, Cramer said that among refiners, Valero Energy Corp. (VLO:US) was a better investment than Tesoro Corp. (TSO:US) because Tesoro's 52-week high made it less likely to rise. He told a caller that Noble Corp. (NE:US) was a good buy. He told a caller that Canadian oil trusts remained good buys and recommended Canetic Resources Trust on its dividend yield and low price.
Hansen Medical Inc. (HNSN:US) could be the next Intuitive Surgical Inc., Cramer said, referring to the medical-device maker that has risen more than fivefold in five years. The founders of Intuitive Surgical are involved in Hansen Medical, which created a robotic catheter system that is likely to sell well once it's approved, Cramer said.
In response to a letter, he recommended Celgene Corp. (CELG:US) based on its financial projections for 2010.
Cramer recommended Ford Motor Co. (F:US)'s convertible bonds, Cia. Vale do Rio Doce and NYSE Group Inc., in response to questions during the show's ``Lightning Round'' segment. He said to hold shares of Denny's Corp. (DENN:US), Yahoo! Inc. (YHOO:US) and BEA Systems Inc.
Cramer told viewers to avoid USG Corp. (USG:US) and Heelys Inc. He said people who have owned Big Lots Inc. (BIG:US) stock for a year should sell. He said to sell News Corp. (NWSA:US) when it rises another dollar and to dispense with Quiksilver Inc. (ZQK:US) shares if they rise.
Cramer owns shares of Halliburton, Transocean and News Corp. for his charitable trust, according to the show.
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