Jim Cramer's Mad Money Review

"Wind power is the cheapest form of renewable energy out there," Jim Cramer reminded viewers of his "Mad Money" TV show Wednesday.
A longtime bull of the wind power business, Cramer cited a recent report stating that 30% of our nation's energy could be derived by wind power by 2040.
To help illustrate the many great companies involved in the wind power business, Cramer built a windmill from scratch, piece by piece, to show which companies make each component.
First, Cramer featured the wind tower business that makes the support structures for windmills. Here, he reiterated past recommendations of both Trinity Industries (TRN) and Otter Tail (OTTR) as the best stocks to own.
Next, Cramer featured the windmill blades, and said that Owens Corning (OC) has the best composite materials business for this high-stress application.
Cramer then focused on the nacelle, the structure that houses a windmill's turbine. Here, he identified Woodward Governor (WGOV), Thomas & Betts (TNB) and Kaydon (KDN) as the companies to own for turbines, bearings and the other components found in the nacelle.
Finally, Cramer said both MasTec (MTZ) and Thomas & Betts are the best companies for the wind power infrastructure needed to bring power from the mill to the grid.
Cramer placed all seven of these companies into what he called the "Mad Money Wind-ex," his index of wind power stocks. He said with the American Wind Energy Association's annual conference beginning in Houston next week, there should be a lot of buzz surrounding all of these names going forward.
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Labels: Jim Cramer, KDN, Mad Money, MTZ, OC, OTTR, TNB, TRN, WGOV

Buy Ralph Lauren (RL), Jim Cramer said on CNBC's "Stop Trading!" segment Wednesday.
"I like it because of the J.C. Penney (JCP) tie-in," Cramer said. He said today's move "seems like a bit of a short squeeze," he said, but "I think it can go higher from here."
Elsewhere in apparel, Cramer said that VF Corp. (VFC) "is the analogue of Ralph Lauren. ... If Ralph Lauren's good you don't leave this stock."
Cramer went on to praise management at Eaton (ETN). He said the company is "part of my new-tech world," and predicted it would hit a 52-week high. He said he also likes Emerson (EMR). "These companies are on fire," he said.
Of Nucor (NUE), Cramer said the company's secondary offering is an entry point. He advised more caution on Cleveland-Cliffs (CLF). "Let it cool off before you buy it here," he said.
Cramer was less bullish on AIG (AIG) and Wachovia (WB). "These are serial needers of capital," he said. He said firing AIG CEO Marty Sullivan would cause the stock to go up, and chastised Wachovia for its acquisition of Golden West. "This was one of the dumbest acquisitions ever and they're paying for it," he said.
"If they knew what they owned I would be more comfortable," Cramer said of AIG and Wachovia. "They're like Citigroup (C)." He said that when the companies claim to know what they have, "they're being wishful."
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Labels: AIG, C, CLF, EMR, ETN, JCP, Jim Cramer, NUE, RL, Stop Trading, VFC, WB

Cramer predicts 2009 will be the year for wind power, although the difficulty is finding a pure play on the best form of renewable energy. Industrial bearings producer KDN currently has a grip on half the market for wind turbine bearings, and while less than 10% of revenues come from wind, this figure is expected to double next year and triple in two years according to Cramer's low-ball estimates. While KDN is nearing its 52-week high, it is trading at a mere 19 times next year's earnings with a 14.5% growth rate, and is cheap.
New Tech Wonder: SPX (SPW) Corp.
Cramer says SPX is the ultimate new tech stock, since it is levered to things people actually need, such as clean drinking water, alternative energy and power transformers. Its four major divisions are flow technology, test and measurement, thermal equipment and industrial products and services, and Merrill Lynch recently stated SPX Corp is the best leveraged to global power markets in our coverage universe. Cramer is bullish on SPW, but warned investors not to pay too much for the stock, which is thinly traded.
Revisiting Russian Stocks: Mechel (MTL), Wimm-Bill-Dann Foods (WBD), Central European Distribution (CEDC), Central European Media (CETV), CTC Media (CTCM)
Cramer was happy to report the five Russian stocks he recommended on Apri 7th were up an average of 13.7% while the S&P 500 rose only 1%. Still, the mini-portfolio needs trimming, and Cramer would get rid of CTC Media because of its poor performance and because he should not have picked two media stocks. CTCM only has 12-13% market share and recently overpaid for an acquisition. Cramer would keep the rest of the Russian stocks, but would happily let CTC defect.
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Labels: CEDC, CETV, CTCM, Jim Cramer, Mad Money, MTL, SPW, WBD

The banks and the homebuilders won't go down, Jim Cramer said on CNBC's "Stop Trading!" segment Tuesday.
"These companies continue to attract investors," he said. He pointed to Standard Pacific's (SPF) ability to raise capital today.
Cramer said this news is broadly bullish for the homebuilders, who may receive further capital infusions from hedge funds. "If you're emboldened, you'll come and buy another homebuilder," he said. He said National City (NCC) had shown similar ability to raise capital earlier this year.
Cramer: Housing Relief Is in Sight

On the other hand, Cramer expressed concern about Bank of America's (BAC) decision to buy a bigger stake in China Construction Bank. "I threw my hands up with this one," he said. He pointed out that Bank of America already has its hands full with its intended acquisition of Countrywide Financial (CFC). "I see a dividend I'm worried about," he said.
Cramer said $130 "seems to be this iron floor" in the PHLX Housing Sector Index, Cramer said. "March to April shows when you cut numbers people buy," Cramer said, indicating that there may be a bottom in this space.
Cramer ended the segment by pointing out that Apple (AAPL) and MasterCard (MA) are the "momentum plays of a lifetime."
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Labels: AAPL, CFC, Jim Cramer, MA, NCC, SPF, Stop Trading

Gap Inc.'s sales are slumping and shoppers appear unlikely to spend more anytime soon, but the clothing retailer still boosted its first-quarter profit by 40 percent by managing inventory and cutting costs.
"We are pleased with our first-quarter performance in what undoubtedly was one of the most difficult retailing environments in recent memory," Gap Chairman Glenn Murphy said in a conference call with analysts.
The San Francisco-based merchant said Thursday that it earned $249 million, or 34 cents per share, during the three months ended May 3. That compared with net income of $178 million, or 22 cents per share, at the same time last year.
Revenue for the period fell 5 percent to $3.38 billion.
The earnings released after markets closed beat the average estimate of 30 cents per share among analysts polled by Thomson Financial. The revenue missed analysts' target of $3.42 billion.

Labels: Gap Inc., GPS

You can't become a great investor by watching from the sidelines or giving up after a few losses; you have to be willing to get in the game and stay in it, Jim Cramer told viewers of his "Mad Money" TV show.
Cramer said he knows how hard it can be to keep one's head in the game, and as far as he's concerned there are three "forces" that keep people out of stocks: "boredom, bummers and brokers."
Boredom, said Cramer, is a big problem. If market players are not interested in the stocks they own, they won't pay attention and that can lead to unexpected losses. "That's a recipe for disaster," Cramer said.
But as long as people invest well and stay interested, they could make a fortune, he continued. The one cure for boredom with investing is speculation, said Cramer, who believes people need to speculate if they want to be good investors. Speculation, he explained, means trading in a "high-risk, high-reward" stock and "trying to turn a little money into a whole lot of money in not a lot of time."
Some might consider speculation to be foolhardy and "more immoral than gambling," but Cramer, who has made some of his biggest gains by speculating, believes speculation is good for investors.
"I'm telling you it's OK to speculate and make those risky investments that most of the talking heads frown on," he said. "And not only is it OK -- it's entirely necessary. It's prudent and responsible."
Usually when Cramer talks about diversification he's referring to it across sectors, but the principle is the same here. People who don't own some high-risk stocks are not really diversified, he said.
The Ground Rules
Because speculation can be "really risky," Cramer cautioned that investors should only start once they understand the basic ground rules of speculating.
First, never invest retirement money in speculation, he stressed. And second, don't ever have more than 20% of your non-retirement portfolio in speculative stocks.
Cramer urged very conservative investors to put a tiny bit of their money into a speculative stock. "Make it 1% or 2% of your portfolio if you're that conservative, because trust me, that 1% or 2% will make the whole process of investing a lot more interesting," he said.
What to Look For
Generally speaking, Cramer said, when he talks of speculation he is referring to small-cap stocks, meaning those with a market cap of anywhere from $250 million to $2 billion. For those new to the game, market capitalization represents the number of shares of a company multiplied by its stock price. It's one of the best ways of knowing what the market believes a company is worth, he explained.

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Labels: Jim Cramer, Mad Money

Parker-Hannifin (PH), Eaton (ETN), First Solar (FSLR), Emerson (EMR)
In a volatile market, Cramer suggests sticking with bullish themes that have a future. Instead of investing in a company that wants to perfect the next cool gadget, Cramer once again touted new tech stocks which can solve real problems such as energy, food, water, the environment, poverty, fighting terrorism, disease and education. PH, ETN, FSLR and EMR are developing new technologies to tackle global challenges. Cramer singled out PH for its generous, safe dividend.
Navistar International (NAVZ), Cummins (CMI)
Navistar, which has 60% market share of school buses and trucks is Cramer's favorite in the industry after CMI. NAVZ is developing hybrid diesel engines which can reduce fuel costs by 9-13% and its military division could earn $2 billion. The biggest catalyst is the company's relisting on the New York Stock Exchange. NAVZ was delisted a few years ago after facing accounting problems but should return to the exchange any week now. Cramer thinks this story is similar to Terex's which saw a doubling of its share price after cleaning up its accounting problems. Cramer predicts NAVZ, which trades at a mere 7.7 times forward earnings will jump to $104, a 51% bounce.
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Labels: CMI, EMR, ETN, FSLR, Jim Cramer, Mad Money, NAVZ, PH

Take some profits in hot sectors, Jim Cramer said on CNBC's "Stop Trading!" segment Tuesday.
"It's about time," Cramer said of today's market selloff. "Heaven love the rails," he said, "but they do not have to be up every day." He recommended ringing the register in groups that are "having parabolic moves." He also said he doesn't like tech at these levels.
Cramer said he does like some stocks here. He said Honeywell (HON) is a buy if the price comes down. He said the company "basically preannounced the other day, and it's not really doing anything."
Cramer said some steel companies will win on the earthquake in China. He said that he wants to be in on a secondary offering from Nucor (NUE). "Very rarely do I ever want to be in a secondary," he said. "Not this one. This one is a winner."
Of the larger commodity markets, Cramer said that stocks with oil exposure are "not expensive." He said that "people are not using $125 [a barrel for oil] in their numbers." He said that with that factor added in, many stocks should be priced higher.
Cramer also said he likes CSX (CSX) and Union Pacific (UNP), but recommended taking profits "just as a prudence method." He expressed concern that the American rail companies appear to be the only stocks reacting to the news of the China earthquake.
Cramer also praised oil and gas magnate T. Boone Pickens for being right about ethanol. Cramer said that when 3% of gasoline destroys 30% of America's food supply, it's "about as dumb a thing as I've ever heard.
"I'm the most rapacious capitalist that's ever lived," Cramer said, but "I still have some horse sense."
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Labels: CSX, HON, Jim Cramer, NUE, Stop Trading, UNP

Kroger (KR): "I'm concerned about the supermarkets. The margins are getting squeezed. I cannot endorse that group."
First Solar (FSLR): "First solar remains the least expensive way to play solar. I want you to stay in it, but I want you to buy more at a lower price."
Imax Corp (IMAX): "I've been wrong on this one. It's been moving, but I still won't recommend this one. "
Sina Corp (SINA): "I have been staying away from China. It's too explosive and too crazy, I don't want to lose people money."
Fluor (FLR): "This stock exploded last week and then went up again today. Ring the register and get into Foster Wheeler (FWLT). This one's just too expensive."
International Paper (IP): "No, no, I like Weyerhaeuser (WY) more, and I like Temple-Inland (TIN) more. IP is just not well run."
Emcore (EMKR): "Fiber-optic play, over-crowded segment. I don't want to go with that one. I like ADC Telecommunications (ADCT) and that's it."
Reliant Energy (RRI): "I don't know. It's not my favorite. I'd steer you toward Dynegy (DYN) instead."
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Labels: ADCT, DYN, EMKR, FLR, FSLR, FWLT, IMAX, IP, Jim Cramer, KR, Lightning Round, Mad Money, RRI, SINA, TIN, WY

In November, 2007, Cramer identified five stocks that he felt were made of Kevlar and could withstand the ailing economy and sub-prime mortgage crisis. To date those five stocks are up 8.8%, while the S&P 500 is down, 3.3%.
Cramer said it wasn't smooth sailing for his "bullet-proof" stocks at the start. Just a week after he mentioned the names, the portfolio was down a quick 6%. "But that's the point," he said, "we bought these stocks because they bounce back."
Cramer's first pick in his portfolio is Altria (MO), a stock which he owns for his charitable trust Action Alerts PLUS. Since the recommendation, Altria has spun off its Phillip Morris International (PM) division, and collectively the stocks are up 4.7% since November.
Cramer said he's a fan of both companies, especially Altria's 5% dividend yield.
Next on the list was Freeport-McMoran (FCX), another stock which he owns for his charitable trust Action Alerts PLUS.
Cramer called Freeport, which is up 11.9% since he mentioned it, the best copper story in the world.
Third in the portfolio was another Action Alerts name: Foster Wheeler (FWLT). Although Foster has been a laggard in the portfolio, down 1% since November, Cramer said the company is still levered to high energy prices around the world and here too and he's been buying more shares.
Fourth was Transocean (RIG), the star performer in the group, up 27.6%. Cramer called Transocean the best deep-water contract driller out there with great earnings visibility. He advised viewers to take some profits, but remained bullish on the company.
Finally, Cramer revisited Medco Health (MHS), a stock which is up just 0.7% since the November mention. Cramer said that while Medco makes its money whether or not the economy does well, it has more competition that he originally thought and perhaps the traditional defensive stock wasn't right for this portfolio. He told viewers "if it rallies, I'd sell it."
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Labels: FCX, FWLT, Jim Cramer, Mad Money, MHS, MO, RIG

Buy Syngenta (SYT), Jim Cramer said on CNBC's "Stop Trading!" segment Monday.
Cramer said the Swiss agriculture company has been welcomed in Europe, unlike American companies. "I always felt that Europe had been very inhospitable to American biotechs," he said, calling Syngenta "one that they embrace." The stock is a "great buy," he said.
Cramer pointed out that Syngenta is off its highs. Because Bunge (BG), Monsanto (MON) and Syngenta all trade alike, "Anytime you get a discount in one, I'd pull the trigger," he said.
In energy, Cramer recommended ABB Ltd. (ABB). Cramer said that presidential candidate John McCain has left nuclear power as "really the only option" he supports. "ABB is the nuclear company from around the globe," he said.
Cramer said that Deutsche Telekom (DT) ought to acquire Sprint Nextel (S). With "no growth" and a 7% yield, Cramer said, Deutsche Telekom should take advantage of Sprint's install base. "They need growth to get this thing energized," he said. "I don't know what the holdup is."
Of BP (BP), Cramer said that American investors are impressed with the company's new management. He said that BP's 4% yield is safe.

Labels: ABB, BG, BP, DT, Jim Cramer, MON, S, Stop Trading, SYT

Jim Cramer took up the protracted debate over the market's bottom on his his Mad Money TV show Friday.
Cramer said he is not taking sides in the debate, trying instead to remain flexible.
Noting there are arguments both for and against calling a bottom in the stock market, he emphasized just having the debate itself is a good sign.
On the upside, Cramer cited the PHLX Housing Sector Index. "This home building index won't go down, despite the fact home builders are reporting horrible numbers," he said. "When you get bad news and nothing happens, that's a bottom."
On the downside, he pointed out, there are still many bearish arguments, including the weakening dollar and consumer confidence. While home prices may be stabilizing in some areas of the country, they continue to weaken in others.
Cramer said he's looking to Lowe's (LOW) and Home Depot (HD), both of which report next week, for clarity on the real state of the housing market.
Overall, Cramer told viewers that he's sticking with the same long-term themes he's discussed over the past few weeks. And that they are international infrastructure, oil and natural gas, mining and minerals, and defense stocks. He also likes his "new technology" companies that are making real solutions for real problems.
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Labels: HD, Jim Cramer, LOW, Mad Money

Buy Sterlite (SLT) Jim Cramer said on CNBC's "Stop Trading!" segment Friday.
Cramer said the company's power business is coming online soon, supplementing other strengths. He said the company's exposure to zinc, copper and aluminum, three metals he can't get enough of, are another strength. He pointed out that China currently has a "voracious" appetite for zinc.
"Two thumbs up for Sterlite," Cramer said.

Labels: Jim Cramer, SLT, Stop Trading

Buy Caterpillar (CAT), Jim Cramer said on CNBC's "Stop Trading!" segment Wednesday.
On news of an earthquake that has cost a great deal of damage and as many as 15,000 lives, Cramer spoke of the "rebuild in China," which he said was an equivalent of Hurricane Katrina in terms of infrastructure buildout. He pointed viewers to Caterpillar and Terex (TRX) as plays on the news. He also recommended Cummins (CMI). "They're all headed up ... because of the rebuild," he said.
Cramer said today's rally has a lot to do with bullish action from mortgage insurer Freddie Mac (FRE). "They have gotten rid of the systemic risk," he said. He called Freddie Mac and Fannie Mae (FNM) the "last of the black holes" for the financial crunch.
Cramer said Freddie is getting a lot of business, which he thinks may actually offset the company's losses. He said bears don't believe that's the case, but he pointed out that Freddie is a well-run company. Fannie is not as good, he said.
In the consumer discretionary space, Cramer said he had thought "the buyers would just call it quits" after the government's stimulus checks came in. He revised his forecast, saying maybe earnings from Kohl's (KSS) tomorrow will be the time to sell.
He expressed his surprise at the continued rise of some retailers. "Certainly we know that Costco (COST) is better than we thought. ... TJX (TJX) was a little disappointing, and look -- it goes up." He pointed out that Wal-Mart (WMT) stock has traded back to where it was before reporting earnings.
"A lot of people feel that the worst is over," Cramer said. He pointed out that the Fed called victory when inflation numbers came in better than expected.
Cramer also said that the year of wind power may arrive this year, not next year as he had previously predicted. He pointed out bullish action in Fluor (FLR) and First Solar (FSLR) as evidence of alternative energy stories.
He also said that Research In Motion (RIMM), Apple (AAPL) and MasterCard (MA) are offering leadership in the economy.
On the housing crisis, Cramer said that Toll Brothers (TOL) CEO Bob Toll was "negative negative negative" when the two spoke on last night's "Mad Money" TV show. He predicted that the housing problem in Florida would be much better in 18 months.

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Labels: AAPL, CAT, CMI, COST, FLR, FNM, FRE, FSLR, Jim Cramer, KSS, MA, RIMM, Stop Trading, TJX, TOL, TRX, WMT

On news that EnCana (ECA) would be splitting into a natural gas firm and an integrated oil company, Cramer said several other companies might make a similar move. He pointed to Anadarko (APC) and ExxonMobil (XOM).
"My urging is you go over these companies," Cramer said. "They all have oil, and they've all got gas businesses." He advised against chasing the stocks higher, but said that inventory numbers could send these stocks down, creating a buying opportunity.
Cramer also discussed Toll Brothers (TOL) CEO Bob Toll, who will be appearing on "Mad Money" tonight. Cramer praised Toll for always being "straight with me." He said the homebuilding CEO is "not bullish at all." Cramer said he would ask Toll why he is talking about buying more land, a move of which Cramer is skeptical.
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Labels: APC, ECA, Jim Cramer, Mad Money, TOL, XOM

Gold is back, Jim Cramer said on CNBC's "Stop Trading!" segment Thursday. Cramer dismissed Wall Street observers' claims that the dollar is correlated with oil. "Oil is correlated to supply and demand," he said. "The stocks are signaling that gold is going higher." He recommended Agnico-Eagle Mines (AEM) and Yamana Gold (AUY). "They're not done going up," he said.
"Retail was a great trade," Cramer said, but "we're finished. I want to sell retail." He instructed viewers to get out of Nordstrom (JWN), Phillips-Van Heusen (PVH ) and VF Corp. (VFC).
On the other hand, "Wal-Mart (WMT) is the keeper in this group," Cramer said. However, he observed that "Kohl's (KSS) said good things, the stock is going down. This group has had it." He was also bearish on Target (TGT).
Cramer then moved on to discuss oil drilling in India. He said companies like Transocean (RIG) are "really talking about India."
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Labels: AEM, AUY, Jim Cramer, JWN, KSS, PVH, RIG, Stop Trading, TGT, VFC, WMT

Buy ArvinMeritor (ARM) Jim Cramer said on CNBC's "Stop Trading!" segment Tuesday.
"I've been recommending that for a very long time," Cramer said of the auto parts company. "It's an American comeback story." He also recommended Borg Warner (BWA), which he said "has been really amazing."
Cramer said of Precision Castparts (PCP) that, up 9 points today, it's "not done." He also said that although Alcoa (AA) is a "gigantic user of energy," the company "can put through price increases." He also said he likes U.S. Steel (X), saying "It will not quit."
Cramer said that MasterCard (MA) and Apple (AAPL) appear unstoppable.
Legg Mason (LM) posted its first-ever loss today, sending shares down. Cramer said, "You can deliver bad performance... and people just yawn." He said that today Legg Mason showed "horrible performance."
Cramer also praised NYSE Euronext (NYX) CEO Duncan Niederauer for guiding the company to success. It announced soaring profits today on heavy trading volume. "This stock is just beginning at last. ... The model works," Cramer said.
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Labels: AA, AAPL, ARM, BWA, Jim Cramer, LM, MA, NYX, PCP, Stop Trading, X