Mad Money Man
Cramer came out tonight saying that the word "Brands" makes him quiver. Stocks should not be bought just because they have brands. There are two stocks that have brands but should not be bought. These stocks include: Spectrum Brands (SPC) and Prestige Brands (PBH). These companies were put together by private equity firms who make money at everyone's expense, which is not a good thing for investors.
Reasons why SPC is bad:
- offer a bunch of products that have no business being together
- based on a false concept
- they need zinc for their battery brand, their biggest product, and there is a shortage of zinc
- their costs are going up but can't pass these costs on to customers because they have no pricing power
- they are in a mountain of debt
Bottom Line: Stick with best of breed, stay away from companies like SPC
Reasons why PBH is bad:
- it is competing with best of breed, Johnson & Johnson JNJ
- only thing attractive is their cheap prices and that won't carry the day
- they are deep in debt
- CEO left unexpectedly last year which raises the red flag
Bottom Line: Get defensive, these lousy brands only have hype, buy best of breeds
Cramer likes Altria group (MO) because they are about to split off its Kraft division and their tobacco branch expected to be praised by the congress. Cramer believes it will reach par, which is Wall Street gibberish for 100.
Lightning Round
Bulls
RTK
PEP
KO
ORCL
HAL it will be painful for a while, go long
EZM
BTU
INTC
SBUX
Bears
TZOO
FIZ
ECA
WMT
RTI
ALVR
MEE
NT
MSFT
Cramer reiterated the importance of doing homework. He warned to be careful of media traps. He gave the example of the NY Times reporting the cut in Medicare. Most people panicked once they read this and sold their positions in Medicare stocks. However, the NY Times reported old news, this was reported three months ago by a best of breed analyst, Weakely, which is one of Cramer's favorites. Cramer claims JNJ and STJ are buys despite the medicare cuts.
Bottom Line: headlines won't make you money, do your homework.
posted by Stock Administrator @ 8:45 PM
Mad Money Man
Cramer came out tonight saying that the word "Brands" makes him quiver. Stocks should not be bought just because they have brands. There are two stocks that have brands but should not be bought. These stocks include: Spectrum Brands (SPC) and Prestige Brands (PBH). These companies were put together by private equity firms who make money at everyone's expense, which is not a good thing for investors.
Reasons why SPC is bad:
Reasons why PBH is bad:
Cramer likes Altria group (MO) because they are about to split off its Kraft division and their tobacco branch expected to be praised by the congress. Cramer believes it will reach par, which is Wall Street gibberish for 100.
Lightning Round
Bulls
RTK
PEP
KO
ORCL
HAL it will be painful for a while, go long
EZM
BTU
INTC
SBUX
Bears
TZOO
FIZ
ECA
WMT
RTI
ALVR
MEE
NT
MSFT
Cramer reiterated the importance of doing homework. He warned to be careful of media traps. He gave the example of the NY Times reporting the cut in Medicare. Most people panicked once they read this and sold their positions in Medicare stocks. However, the NY Times reported old news, this was reported three months ago by a best of breed analyst, Weakely, which is one of Cramer's favorites. Cramer claims JNJ and STJ are buys despite the medicare cuts.
Bottom Line: headlines won't make you money, do your homework.
Reasons why SPC is bad:
- offer a bunch of products that have no business being together
- based on a false concept
- they need zinc for their battery brand, their biggest product, and there is a shortage of zinc
- their costs are going up but can't pass these costs on to customers because they have no pricing power
- they are in a mountain of debt
Reasons why PBH is bad:
- it is competing with best of breed, Johnson & Johnson JNJ
- only thing attractive is their cheap prices and that won't carry the day
- they are deep in debt
- CEO left unexpectedly last year which raises the red flag
Cramer likes Altria group (MO) because they are about to split off its Kraft division and their tobacco branch expected to be praised by the congress. Cramer believes it will reach par, which is Wall Street gibberish for 100.
Lightning Round
Bulls
RTK
PEP
KO
ORCL
HAL it will be painful for a while, go long
EZM
BTU
INTC
SBUX
Bears
TZOO
FIZ
ECA
WMT
RTI
ALVR
MEE
NT
MSFT
Cramer reiterated the importance of doing homework. He warned to be careful of media traps. He gave the example of the NY Times reporting the cut in Medicare. Most people panicked once they read this and sold their positions in Medicare stocks. However, the NY Times reported old news, this was reported three months ago by a best of breed analyst, Weakely, which is one of Cramer's favorites. Cramer claims JNJ and STJ are buys despite the medicare cuts.
Bottom Line: headlines won't make you money, do your homework.
posted by Stock Administrator @ 8:45 PM
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