JJC:   I just want a few more days like today. The market staged a back from the dead rally today... One of the few in what seems like ages... So many times we have seen rallies look fabulous at the beginning, only to fail later in the day and we choke on everything we bought... Not today... Today, for the first time, we were rewarded if we pulled the trigger with fabulous pit action... And I think that's because we've got some new leaders, some new leaders top business models, so to speak... And to beleaguer, and belabor the teen play at NBC issue, one ripped from the front pages, but not necessarily from the newspapers, no the "Cramerican Marine Field Guide to Recessions... Right on schedule... The drug and healthcare stocks that were so hated just one weak ago are the very stocks that went up today and of course the stocks we are featuring all week on Mad Money... Remember, Wall Street is a vicious and mercurial fashion show... At times like this, when the economy is weak and the global economy seems like it's teetering, Uh, well... The big money guys, who are the critics and the buyers of the ready to wear stuff at the fashion show will tend to decide that stocks with safety and consistency, yeah that's right, boring ones, were all over the runway... And momentarily, the commodity plays get shoved into the sidelines...

I think the safest and most consistent group in this environment of high energy prices, yeah, I know they came in little today, high raw costs, and economy that is doing the dead man's floats despite the 150 Dow Jones move... The best one, is the group I started yapping about yesterday and will continue to highlight, some say tap, some may promote, I don't care...

Every day this week it's going to be healthcare... It's generally immunized against those energy prices and I still consider the price of oil to be high after the $10 swan dive of the last few days or high grain prices, yeah, I see them coming down too, but it ain't that much, or an economy that is flatlining, and a financial system that showed a bit of a pulse today, but otherwise has been DNR, as in "do not resuscitate"... These healthcare stocks, even the ones I don't like, are right now worth owning... As money managers swap out of less dependable sectors, that had been , and into relative safety, and boredom of healthcare stocks... Now drugs, the drug stocks had been in a vicious and horrible bear market, as measured by the pharma-index, called the DRG, uh huh drug, aren't we great on Wall Street, which fell from $355 in early January to as low as $283 on June 11th... But now the index be flying!... Ho, ho... Buy, buy, buy... Closing at $305, and showing that healthcare is back and bigger than ever, just like Ghandi two... You might not have seen that movie...

Remember, it is all perception... It's the fashion show... The big boys like this group now, versus others because they fear the more exciting mineral and oil plays may not be able to meet expectations... Put aside whether you think they can or not for a moment... What I need you to understand is the fashion show, and the big boys are comfortable with these new stocks... Even if they really are the same old, same old, really with now pizzazz... The stocks that went up the most today, nothing changed for them... You could be sitting there saying wow, hey, what happened to Merck (MRK)?... What's going on with Bristol-Myers Squibb Co. (BMY)?... There is nothing, except for the fact that the big boys feel more comfortable... This (bear) was Bristol-Myers last week... This (bull) is Bristol-Myers today... Oh, and before I can give you what could be the next big healthcare winner... Can I just say point blank, right here, right now, that the only thing that can immunize you from the vicissitudes of this really crazy fashion show is diversification... See, if you just own nothing but the first half of the year's winners, oil and gas, you know what would have happened in the last few days... You would have been blown away... A diversified portfolio with some healthcare in it to offset a commodity loser could keep you in the game... The ultimate goal, if we were to keep on gunning, for the American Dream... Oh, 7 o'clock Sunday night, on NBC, for those who want to catch my Nascar network special... Shameless?... Who cares... Alright, so for tonight's healthcare play, I give you a guy and his nephew...

Uh, more precisely, Smith & Nephew PLC (SNN)...

This one is a medical equipment company that got beheaded after a disappointing first quarter... Sinking from $64.73 on April 30th at the close to $57.40 on May 1, the day after it reported... Hey, that's an 11% drop, and it's languished down in the $50's ever since... Closing today at a mere $52 and change, this one hasn't been recognized other than Cramer... The Street is overreacting to that quarter and shunning what I think is an otherwise good company... It gives you a chance to get in a great stock at a much too low price that hasn't been swept up in this incredible rotation of the last three days... SNN has it's hands in several different businesses... 37% of their sales come from orthopedic reconstruction, hip and knee replacement... Good business to be with our aging, weight gaining population, even if SNN is the number 4 player in the business... Boy, I'll tell you, if I were number 1, 2 or 3, I'd snap these guys up... Both Smith and his nephew...

SNN also has an orthopedic trauma business where they make the equipment doctors need to help deal with bone fractures and other trauma... These are generally stable businesses, because doctors don't like to change their suppliers... Then SNN has an endoscopy business, making the tools for minimally invasive surgeries that let doctors look around their patients... You've seen this a million times on House, I mean, on ER... And then, finally, there's SNN's advanced wound management business, this is really my favorite... It's part of a happy Duopoly with ConnetiConcepts selling wound VAC equipment... $1.6 Billion market for that equipment... Creates a low pressure environment to help wounds heal more quickly, and with less risk of infection, get people out of the hospital quickly... That's the story for both democrats and republicans... Now, uh, what happened with the missed quarter?... And why do I think SNN will make or beat the numbers in the future based on the fact that they screwed up... It's a tale of two acquisitions... Last March SNN bought a Swiss-based company, an orthopedics company, it's called Plus, and another company they bought called BlueSky in the middle of 2007, which is how it got into that nifty wound vac business, the duopoly... When SNN reported its quarter it turned out that there were some skeletons in the closet at PLUS, causing $100 million in sales costs and $10 million in investigational costs because of it... Here's some language, "unacceptable selling practices"... Woo, with PLUS... Look, I don't think it's a big deal, okay?... Compared to the $3.37 billion in revenues the company brought in 2007... But nonetheless, the stock got pummeled... Partly because again, no one wanted this, they were too busy chasing the Wildcatters... Uh, that's the first reason...

The second is that the expectations for the second company SNN acquired, BlueSky, were way too high... When SNN bought BlueSky last year it had 20 employees and it was generating just $11 million in sales... So, SNN had to spend some moolah to build up the sales force and ramp up manufacturing... That aided to the performance of its wound care segment... The Street didn't like this, but I don't know how they didn't see it coming, frankly. Sometimes they just get it wrong... Now we've got a stock that is just incredibly beaten down... But I believe it has spent the money it needs to expand this wound business and remember it's only competitor is KCI, we've had them on this show, we like this... SNN expects to see the benefits from its spending the second half of the year, which just so happens to be, right now!... I think the bad news is all in the past... And even with that so called bad quarter, SNN still managed to deliver 14% earnings per share growth... So now we have what I think is an incredibly cheap play on the aging of America with its orthopedics business with what it looks like now an up and running advanced wound care division with the potential to deliver serious growth that should only have to deliver so-so results for the Street to be impressed, lowered expectations, disappointing quarter... Oh, I should add, SNN has a terrific 3-year $1.5 billion buyback... Don't forget, these healthcare stocks have been out of favor for so long that it's only like they believe, and you didn't... They've repurchased $640 million of stock, while you ignored it... Not too shabby for a $9.4 billion company, very shareholder-friendly.

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