Cramer: Sears Holdings better than Wal-Mart as a retail pick

Sears Holdings Corporation (NASDAQ: SHLD) opened at $179.62. So far today the stock has hit a low of $179.00 and a high of $180.66. As of 1:25 p.m., SHLD is trading at $179.78, up $0.62 (0.3%).

After hitting a one year high of $189.97 in February, the stock backed off slightly during the market selloff at the end of last month. On his Mad Money TV show last night, Jim Cramer was asked about Wal-Mart Stores Inc. (NYSE: WMT). He admitted that though he still has no love for WMT, its management is looking better and the stock may even be undervalued at its current price. But he's still not happy with the stock. For retail, SHLD is a much stronger pick according to Cramer. The technical indicators for SHLD have been bullish and slightly deteriorating, while S&P gives the stock a neutral 3 STARS (out of 5) hold rating.

For a bullish hedged play on this stock, I would consider a May bull-put credit spread below the $160 range. SHLD hasn't been below 160 since September and has shown support around $175 recently. This trade could be risky if the mid-May earnings for SHLD disappoint, but the stock looks like it has a few levels of support between its current price and $160 that could protect our position.

Brent Archer is an analyst on the move at Investors Observer. (Free Subscription)

DISCLOSURE: Mr. Archer owns and/or controls diversified portfolios of long and short stock and option positions that may include holdings in companies he writes about.