According to Cramer, TJX Companies (TJX) is no longer in control of its destiny, and the stock's best days may be behind it. Even management on the company's conference call lowered guidance and warned of tougher times ahead, he said. The problem? Cramer said TJX benefits by buying distressed merchandise from other retailers. But with the retail sector stabilizing, there simply isn't enough merchandise for TJX to buy. Cramer said TJX also benefited last year from the demise of rival Linens N' Things, an event that's now well priced into TJX shares. Cramer called TJX's conference call one of the worse of the quarter, noting that management offered no hope for improvement in the latter half of the year.

Cramer said while he prefers shopping at Costco (COST), BJ's (BJ) is the better stock. The company trades at just 12 times earnings, while Costco, often perceived as the higher end play, commands 18 times its earnings. Cramer said this notion could change, however, as BJ's simply runs its business better than Costco.

After weighing all the facts, Cramer anointed BJ's Wholesale Club (BJ) as his king of discount retail. He said that because BJ's is a membership club, it's less likely to lose customers as the economy recovers, and out of all of the stocks he considered, the company has the most room for growth, and is the best stock, having only risen 7% from its March lows. Cramer said investors should only have one discount retailer in their diversified portfolios, and BJ's should be that stock.

Cramer said Big Lots (BIG) is definitely in the running for the title of "discount king" given how upbeat the company's management was on its conference call. He said unlike fellow discounter TJX Companies (TJX), Big Lots does not focus on apparel but has a broad mix of products from consumables to electronics to seasonal items.

Cramer said Ross is not his king of retail because it, like TJX, faces a sourcing problem. As the retail sector recover and inventories remain lean, Cramer said discount chains like Ross and TJX which depend on closeout and overstock merchandise get squeezed. Ross, like TJX, is not in control of its destiny, said Cramer.