Jim Cramer Blog

On Tuesday's show, Cramer began by saying today is a perfect example of why you need to stay in the investing game. He said that Citigroup (C) went from a stock you must stay away from to a stock you must own after Abu Dhabi bought a large stake. It was also announced that they might buy into two more Dow stocks, so Cramer is looking for a way to profit from this trend. Cramer said focus on Halliburton (HAL) because it is trading at a large discount to other oil service stocks. He thinks that it could be worth $53 per share, and that these Arab states will invest in what they know, oil. One issue with the stock is that the company is hated by politicians in the U.S., but Cramer doesn't seem to think that Dubai or Abi Dhabi cares.
Then Cramer went to the phonelines. The first caller asked about opportunities in shale oil stocks, and Cramer recommended that people buy Suncor (SU) immediately. The next caller asked about the proposed takeover of BHP Billiton (BHP). Cramer is bullish on the stock and doesn't think it will be an issue.
Lighting Sector: One stock that Cramer likes is Acuity (AYI). It would be a good buyout target for Philips (PHG), and the stock didn't move up much on the news that Philips plans to buy several lighting companies to go with its buyout of Genlyte (GLYT). Also, this company will grow quickly with retro-fitting of old buildings that need to update their lighting. Another plus for AYI is it's a commerical building play, which is still going strong despite the problems in the residential housing market. Given the same valuation as Genlyte, it would be worth $57 per share.
Cramer came back fromt he lightning round and talked about a battle between two analysts over Starbucks (SBUX). FBR raised the stock to a buy, while CBIC lowered it to a sell on the same day. Cramer wanted to take a closer look at the stock, and after doing his homework, Cramer agreed with CBIC and is bearish on SBUX. He doesn't like the stock because the company has a lot of low priced quality competition, the stock has a contracting multiple, and growth is slowing. He thinks it would have to go well below 16 to be a buy.
The CEO of Aecom (ACM) was on the show, and announced quarterly earnings and guidance for 2008, and the stock dropped over 10% today. He said that the decreasing backlog is due to normal seasonal patterns in orders, and that they expect to continue their growth. He is bullish about the company and the stock. Cramer was disappointed and said that the company will have to show him that it is still on track next quarter before he will buy it again.

Labels: ACM, AYI, BHP, Citigroup Inc., CNBC, GLYT, HAL, Jim Cramer, Jim Cramer's Stop Trading, Lightning Round, Mad Money, Mad Money Lightning Round, Mad MOney Recap, SBUX, SU

Stocks were slammed today, as a late-afternoon sell-off was fueled by continued worries surrounding the financial and mortgage sectors. The Dow lost -237 points to close at 12,743 for the day. Meanwhile, the Nasdaq and S&P each closed down more than -2% to finish at 2,541 and 1,407, respectively. Light, sweet crude prices were down in trading with oil closing at $97.70 per barrel for January delivery. Treasury prices were higher on the day, while gold prices rose to close at $826.50 an ounce. The dollar fell against the euro, but remained relatively unchanged versus the yen.

In corporate news, Europe's largest bank HSBC Holdings (NYSE: HBC - News) announced today that it will bail out two of its bank-managed funds by transferring approximately $45 billion of the structured investment vehicles' assets onto its balance sheet. HSBC also said it will inject $35 billion into the company-managed funds in order to prevent liquidation of their assets. Shares of HSBC were down -2.6% at the bell.
Shares of SunPower Corp. (Nasdaq: SPWR - News) traded higher today, prodded by speculation that Congress may look to pass an energy bill favoring renewable resources before Christmas. The solar-panel maker's stock rose more than 5% during trading before pulling back to close up 1.9% on the day. Shares of SunPower's majority shareholder, Cypress Semiconductor (NYSE: CY - News) also climbed higher on the news and posted a small gain for the session.
On the M&A front, Royal Philips Electronics (NYSE: PHG - News) said that it will acquire light fixture company Genlyte Group (Nasdaq: GLYT - News) in a deal valued at $2.7 billion. According to details, Philips will pay $95.50 per share for Genlyte, representing a 52% premium over the company's closing price on Friday. Shares of Genlyte soared in trading and closed 50.7% higher on the day. Meanwhile, Philips' stock was off -1.9% at the bell.
Elsewhere, Sears Holdings (Nasdaq: SHLD - News) said it is prepared to make a cash tender offer of $6.75 per share to acquire Restoration Hardware (Nasdaq: RSTO - News), according to a SEC filing. Sears' bid trumps a previous offer of $267 million, or $6.70 per share, for the home-furnishings retailer made by an affiliate of private equity firm Catterton Partners. Restoration Hardware's stock was up slightly on the day, while shares of Sears closed down -4.3%.

By the BullMarket.com Staff

Labels: CY, GLYT, HBC, PHG, RSTO, SHLD, SPWR