Jim Cramer's Mad Money Review

Bullish calls:
Apple (NasdaqGS: AAPL): 'AAPL is the best-acting technology stock in the book ... Don't trust most of techonlogy, until we get to the summer... but not AAPL. I think AAPL is best in show. Pull the trigger on any weakness...'Yamana Gold (NYSE: AUY - News): 'I think gold is a good place to go. I think people should have 1 gold stock out of 10. And the stock they should own is AUY! Which is the only gold company which is completely and utterly replenishing its coffers, even as it is produces gold. You got it right. Do you back up the truck? Let's do that at $12.'Alliant Techsystems (NYSE: ATK - News)General Dynamic (NYSE: GD - News): ' ... you know that GD may be best in show.'Lockheed Martin (NYSE: LMT - News): 'Take a look at LMT, which got completely crushed today. That shouldn't have been down $3.'Genentech (NYSE: DNA - News): 'This stock acted pretty darn well in the selloff. It has been meandering between $80 and $85. I think that Evastin's problems are way overblown ... it's still in my top 4.'Gilead Sciences (NasdaqGS: GILD)Celgene (NasdaqGS: CELG): 'I don't like DNA as much as I like CELG, which is my #1 name.'Genzyme (NasdaqGS: GENZ): 'I don't like it [DNA] as much as GENZ.'Microsoft (NasdaqGS: MSFT): 'Everybody knows that Vista's not selling well. I think that MSFT, at $26, deserves and merits a buy here... not on voice recognition, but on a crystal, rock-solid clear balance sheet, and a business that isn't going away. The stock is now down five straight points. That's an overaction, and I'm buying. Buy, buy, buy!'GlobalSantaFe (NYSE: GSF - News)Transocean (NYSE: RIG - News): 'Rig is #1.'Garmin (NasdaqGS: GRMN): 'I thought GRMN acted very well today ... What a clean quarter they had. Let that stock come in to $50. And then, I don't care about the insider selling. I need you to pull the trigger multiple times... $50, then $47, and then $45... What a stock! What a company.'
Neutral calls:
Diamond Offshore (NYSE: DO - News): 'When I went through the quarter for DO... Frankly, I was not as impressed as I wanted to be... Here's the deal... The pecking order of drillers is very clear: RIG* is #1... Then GSF... and only then, would you pick up DO.'
Bearish calls:
SAIC (NYSE: SAI - News): 'Remember, I said that SAIC, I had to give up on it... I rode it up to $21 and then I rode it back. My bad.'
Published by SeekingAlpha

Labels: ATK, AUY, DNA, DO, GD, GSF, Jim Cramer, LMT, Mad Money, RIG, SAI

During 2006, investor demand for initial public offerings (IPOs) was again fairly tepid: by our tally, about 200 companies went public--roughly the same number as the previous two years--but well below the overheated figures seen during the heady times at the end of the 1990s. Morningstar has been tracking the ranks of newly public companies for years, looking for businesses (and stocks) worthy of attention. But, more recently, we've increased the amount of attention paid to the IPO market, and our analysts have taken a hard look at many of the firms that went public last year.
We bring the same research process to a company regardless of its tenure as a public company, looking for firms with strong competitive positions and stocks trading well below our assessment of fair value. Because we have a broad array of industry expertise, we're able to put a new offering in proper industry context (though there are times when we have the opportunity to learn about new businesses--see Grupo Aeroportuario del Pacifico (NYSE:PAC - News)). Since firms tend to go public when valuations favor the seller (a disadvantage to investors), we spend time thinking about why a company is going public and looking at demand for the shares shortly after the offering. MasterCard (NYSE:MA - News) is a great example of a situation in which insiders were selling stock for reasons other than maximizing their returns. The banks that owned MasterCard were looking to raise funds to cushion against and separate themselves from potential legal liabilities.
While every firm should be judged on its own merits, one way to guard against buying into an IPO at peak valuations is to examine which sectors are "hot." Health-care, energy, and financial services have been the most active recently; of the roughly 80 firms that went public in the fourth quarter of 2006, half fell in or around these three sectors. Getting in on an offering in a hot sector can produce a quick gain, but predicting which stocks will be popular can be risky. For example, within health care, Trubion Pharmaceuticals (NasdaqGM:TRBN - News) is up more than 50% since going public in October, whereas Catalyst Pharmaceuticals Partners (NasdaqGM:CPRX - News), which went public three weeks later, is down 35%.
Also, with energy prices high throughout the year, it's no surprise that a number of firms with ties to oil and gas have sought to raise funds. As energy prices have fallen, though, the sector has performed poorly: About a third of fourth-quarter IPOs are below their initial offer price. We actually think there are some interesting companies in this group, particularly among pipeline operators, to which we often assign our highest wide-moat rating based on their strong competitive positions.
SAICSAIC (NYSE:SAI - News) is a defense contractor that went public in October. The firm distinguishes itself with its broad scientific and technological expertise that runs the gamut from future combat systems and integrated port inspection systems to advanced robotics and even biopharmaceuticals. Owing to a diverse base of engineers and scientists, the firm has successfully identified and capitalized on several emerging technologies. As long as defense intelligence and technological advancement are crucial on the battlefield, we believe SAIC will remain a strategic partner of the government and a good long-term bet.
One of the reasons SAIC chose to go public was to create liquidity for employee stockholders. Employees have long received equity in the firm based on contributions to contracts and cultivation of new business opportunities. This ownership culture has helped the firm build a deep bench of engineers who remain loyal to the company.
StanleyStanley (NYSE:SXE - News), which also went public in October, does extensive information technology (IT) services work exclusively for federal government agencies, including the Defense Department. By focusing its resources strictly on federal agencies, Stanley has developed highly specialized expertise in systems and processes that positions it to benefit from the government's increasing affinity for outsourcing.
On the civilian side, more than half of revenue comes from nonappropriated programs. For example, visa and passport user fees fund Stanley's passport processing contract, and bank fees fund its work for the Federal Reserve. On the military side, Stanley's contracts are not, for the most part, dependent on events, such as military engagements. As an incumbent vendor, the firm has the upper hand when contracts are renewed; consider that since Stanley won the State Department's passport-processing contract in 1992, the re-competes in 1997 and 2002 went uncontested, as rivals determined that its position was unassailable. Also 55% of Stanley employees have secret or top-secret clearances.
Energy Transfer Equity LPEnergy Transfer Equity (NYSE:ETE - News), the general partner for Energy Transfer Partners (NYSE:ETP - News), went public 11 months ago. The partnership units have had a nice run since, but we think they're still worth a look. We love the natural gas pipeline business, and ETE, via ETP, operates one of the best natural-gas distribution networks in the industry, in our view. The Barnett Shale continues to be the hottest natural-gas play in the country, and we believe ETP is in the best position among pipeline operators to benefit from production growth there. The firm's 2006 acquisition of the Transwestern pipeline offers access to markets in the western United States, and building a pipeline with Kinder Morgan (NYSE:KMP - News) to reach the East will give it a system that enables producers to sell into whichever market offers the best price for gas at any given time.
ETE's current yield is low, compared with those of similar partnerships, which typically fall in the 6%-10% range. But ETE holds incentive distribution rights that give unitholders an increasing share of ETP's cash flow as the firm grows. For example, a 10% increase in distributions to ETP's unitholders would result in nearly 20% more cash flow to ETE. So, while ETE investors may not receive a big yield today, we think the shares will appreciate nicely over time.
Published by Michael Hodel, CFA at Morningstar.com

Labels: CPRX, ETE, ETP, KMP, MA, PAC, SAI

Bullish calls:
Schlumberger (NYSE: SLB - News): 'I'm steering people toward SLB.'Transocean (NYSE: RIG - News): ' ... that's the cheapest international driller, now that SLB has run so much. That's a better buy.'Companhia Vale do Rio Doce (NYSE: RIO - News)Allegheny Technologies (NYSE: ATI - News)Wachovia (NYSE: WB - News): 'This is a 4% yielder with decent growth. Good quarter today. You know I like the regional banks. I say it's okay. I prefer BNS.'Bank of Nova Scotia (NYSE: BNS - News): ' I prefer BNS [to WB].'Ford (NYSE: F - News)Marvell Technology (NASDAQ: MRVL - News): 'I am going to recommend - even at the price of perhaps a shortfall near term - MRVL. I think that's one down and 10 up. That's my gift to you.'Charles Schwab (SCHW): 'SCHW's good. ETFC's good. AMTD's good. They all trade more expensively, though, than the full-service brokers.'Ameritrade (NASDAQ: AMTD - News)E*Trade (NASDAQ: ETFC - News)Goldman Sachs (NYSE: GS - News): 'I have been recommending GS. The stock's been down for two days and, you know what? (motions to back up the truck for a 'mon-back) - even that short of time, and I want to buy GS, because I'm using a $300 price target and it's one of my stock picks of the year - my value stock pick...'Johnson Controls (NYSE: JCI - News)Adobe Systems (NASDAQ: ADBE - News): 'I think ADBE is unfairly being brought down. I think ADBE is right here ... I'd like to buy this one for my charitable trust. That's how great I think it is down here ... It's a triple buy. Buy, buy, buy! ... I want you to stay with it.'@Road (NASDAQ: ARDI - News): ' Good speculative play on the net. I like it, I'll endorse it.'Darden Restaurants (NYSE: DRI - News): 'Yes! That's a well-run company!'
Bearish calls:
Talisman Energy (NYSE: TLM - News): 'I don't want to be in TLM. I want to be in RIG.'Zoltek (NASDAQ: ZOLT - News): ' I don't like ZOLT. I think it's played out. We recommended it on this show at $12. When it doubled, we took our profits. And I'm not going back. I do not want to own ZOLT.'Syntax-Brillian (NASDAQ: BRLC - News): 'No can do, my friend. That's like hamburger helper. I'd rather go for the real thing; I'd rather go for the filet mignon [MRVL].'Fuel-Tech (NASDAQ: FTEK - News): 'I like pollution control stories somewhat ... I'm concerned that this is one of those 'State of the Union' plays, where it drops down tomorrow, so let's take profits today.'Visteon (VC)SAIC (NYSE: SAI - News): 'There is a sense that the consulting companies that report to the government for military purposes aren't doing well ... I think that SAI - which I liked a little too much, I now say - is just 'don't buy, don't buy' ... New position for me - new negativity.'Evergreen Solar (NASDAQ: ESLR - News): 'Another one of these (bear)... I am not going to countenance any of these solar plays with energy going down!'Baker Hughes (NYSE: BHI - News): 'BHI has a decent product portfolio, but RIG* is the name of the game ... because it's an international driller. 'Complete Production Services (NYSE: CPX - News): 'No, we're going to RIG.'
Published By SeekingAlpha

Labels: ADBE, AMTD, ARDI, ATI, BNS, BRLC, DRI, ETFC, F, FTEK, GS, JCI, Jim Cramer, Lightning Round, Mad Money, MRVL, SAI, TLM, WB, ZOLT