Jim Cramer Blog

Colgate (NYSE: CL - News), Illinois Tool Works (NYSE: ITW - News), Black & Decker (NYSE: BDK - News): Cramer says that many people are more interested in the Fed than stocks, and that the Fed-obsessed may miss out on good moves like buying Colgate, Illinois Tool Works and Black & Decker. He expressed a wish that investors could return to a time when "we recall that there are only certain industries that are hurt by these rates -- auto and housing." Since neither industries are expected to perform well, Cramer believes a rate hike is unlikely, and while he believes there will be a rate cut, he doesn't expect an upside from a rate reduction this year.
3M (NYSE: MMM - News), Merck (NYSE: MRK - News), UPS (NYSE: UPS - News): Cramer commented on three companies which had poor guidance, 3M, UPS and Merck, and said that 3M "doesn't have a clue," Merck has "bad management" and a"very bad pipe," and expressed bafflement at UPS's low guidance.
Motorola (NYSE: MOT - News), Time Warner (NYSE: TWX - News): When Aaron Task asked about Carl Icahn taking a stake in Motorola, Cramer noted that the activist financier has changed his methods; while Icahn once would really shake up a company, he now enters with a "substantive, constructive critique." Cramer said that he was wary of companies that avoid Icahn, because he can offer "tremendous guidance from many different fields," although Icahn tends to be rough on management. Cramer was surprised to see TWX's Dick Parsons, whom Cramer calls "a modern-day classic CEO" embrace Icahn in spite his cool feelings initially. "The CEO matters more than people realize," comments Cramer, "and the CEO sets the tone."
Published by SeekingAlpha

Labels: BDK, CL, ITW, Jim Cramer, MMM, MOT, MRK, TWX

Black & Decker (NYSE: BDK - News), Caterpillar (NYSE: CAT - News), Illinois Tool Works (NYSE: ITW - News), AT&T (NYSE: T - News), Verizon (NYSE: VZ - News), First Horizon (NYSE: FHN - News), Countrywide (NYSE: CFC - News), Transocean (NYSE: RIG - News), Schlumberger (NYSE: SLB - News), Grey Wolf (AMEX: GW - News)
Cramer calls Tuesday's cyclical rally an "amazing confluence of great things" and notes the rapid rise of struggling manufacturing stocks such as CAT, BDK and ITW which were presumed dead when they gave earnings warnings two months ago. Recession fears made the rally of T and VZ seem all the more impressive. The rise in FHN and CFC demonstrate that fears over the health of subprime lending and defaults are greatly exaggerated. Since Tuesday's rally precedes a Fed meeting on Wednesday and a jobs number on Friday: "It's hard not to be bullish," he said. Cramer concluded by commenting that he prefers oil service stocks RIG and SLB to natural gas, even GW.
Published by SeekingAlpha

Labels: BDK, BW, CAT, CFC, FHN, GW, ITW, Jim Cramer

Investors have forgotten the power of the bond market to create good buys in stocks, Jim Cramer said on his TheStreet.com TV video Webcast Friday -- in particular, American International Group (AIG).
Cramer stressed that many firms make bets on fixed income, citing Goldman Sachs (GS) and Bear Stearns (BSC) as two firms that are very successful in fixed income markets.
His favorite is AIG, which he labeled the cheapest of insurers. "No one's focused on AIG as just a gigantic bond holder, because they're an insurance company," he said. "This stock has moved very quietly from $65 to $72."
This is despite the fact that former CEO Hank Greenberg has been selling the stock endlessly, according to Cramer. But this selling pressure will abate when his stock runs out.
Overall, Cramer said, the market still looks good, particularly finance because of the long bond, technology and the oils on any pullback.
Cramer said take advantage of the 10-cent price increase on cigarettes at Altria's (MO) Phillip Morris unit and consider buying the stock.
As for oil, he said it's coming back down, and as soon it gets to $60 he recommends the stocks in the sector. He called oils the "absolute best trade," citing Transocean (RIG) as a stock he really likes.
Cramer said the week was book-ended by problems in housing, referring to Best Buy (BBY) as a housing player because of its big-screen TVs and home studios business. He also noted Black & Decker (BDK) and warned investors about ITW (ITW) and Ingersoll-Rand (IR).
Cramer said Parker Hannifin (PH) under $80 is intriguing to him, and he still likes Honeywell (HON) off its dividend boost. But he cautioned investors to be careful with the industrials.
Published By TheStreet.com

Labels: AIG, BBY, BDK, BSC, Cramer's TheStreet.com TV Recap, GS, HON, IR, ITW, MO, PH, RIG

Stocks added impressively to yesterday's gains in the morning, but they finished off their session highs due to volatility associated with the quarterly "quadruple witching day" expiration of options and futures contracts. The market got off to a strong start on the Commerce Department's report that core CPI was largely unchanged in November. The Federal Reserve also reported that industrial production was slightly stronger than expected last month, rising 0.2% compared with a forecast of 0.1%, reversing two-straight months of declines.
The benign inflation numbers would seem to confirm the Federal Reserve's expectations that the economy is slowing at an acceptable pace, which many analysts believe bolsters the case for the central bank to cut rates sometime next year. The price of gold, a favorite inflation hedge, tumbled on futures markets. Crude oil futures continued to rise following OPEC's decision yesterday to cut production in order to keep oil above $60 barrel. The 10-year Treasury note was unchanged.
In corporate news, software maker Adobe Systems (Nasdaq: ADBE - News) added 5% after reporting good results last night for its fiscal Q4 ended December 2nd. Adobe, which makes Acrobat, Photoshop, Dreamweaver, and other popular software tools, said it earned $182 million, or 30 cents a share, against $156 million, or 31 cents per share, in the same quarter last year. Revenue rose to $682 million from $510 million. Jeffries reiterated its "buy" rating on the stock and raised its target to $50 from $45, while UBS raised its target from $46 to $50.
Elsewhere in tech, network equipment maker Cisco Systems (Nasdaq: CSCO - News) said it would buy Tivella, a privately held maker of digital signatures. Terms were not disclosed. Cisco's shares rose slightly on the news. Middleware software maker BEA Systems (Nasdaq: BEAS - News) lost ground today despite two upgrades. Piper Jaffray raised its rating to "outperform" this morning, while JMP Securities increased its rating to "market perform" yesterday.
In the industrial sector, toolmaker Black & Decker (NYSE: BDK - News) dropped sharply after cutting its full-year forecast for the third time. The stock shed -10% after the company cut its 2006 EPS outlook to $6.50 from a range of $7.00-7.05. The company blamed the weak homebuilding market and inventory reductions by hardware retailers for the reduced outlook. Competitor Illinois Tool Works (NYSE: ITW - News) also cut its Q4 profit outlook to a range of 72-74 cents a share from its prior forecast of 77-81 cents per share. It fell -2%.
Harrah's Entertainment (NYSE: HET - News) rose slightly following a report in The Wall Street Journal of a potential bid for the company by its smaller gaming industry rival Penn National Gaming (Nasdaq: PENN - News). The paper reported Penn National jumped in with an offer for Harrah's that combined cash and debt, setting up a potential bidding war with private equity powerhouses Texas Pacific Group and Apollo Management, which earlier offered $87 a share in cash for Harrah's. Penn National closed down -2%.
Amgen (Nasdaq: AMGN - News) initially jumped more than $1 a share after Switzerland's Roche said the FDA had extended the review of its anemia treatment Cera for three months to study additional data provided by the company. Amgen, which has accused Roche of infringing on patents for leading anemia treatments, ended only slightly higher.
By the BullMarket.com

Labels: ADBE, AMGN, BDK, BEAS, CSCO, HET, ITW, PENN

American Italian Pasta Co. (NYSE:PLB - News) said the New York Stock Exchange is planning to move forward with the suspension and delisting of the company's common stock following its failure to meet certain filing requirements by an extended deadline. The company expects trading in its stock to be suspended on Dec. 20. It plans to appeal the move. The shares will be eligible for trading on the Pink Sheets following the suspension. American Italian Pasta also said it expects to file its annual report for the fiscal year ended Sept. 30, 2005 by the end of January. The company also said it believes price increases for its products will not fully offset the negative impact of higher durum costs in fiscal 2007.
Affymetrix Inc. (NASDAQ:AFFX - News) shares sagged after its chief financial officer, Greg Schiffman, left to take the same position at cancer-focused biotechnology company Dendreon Corp.
Apple Computer Inc. (NASDAQ:AAPL - News) shares dipped after the company said Friday it will delay its annual report for the fiscal year ended in September. The company has also delayed filing its last two quarterly financial reports amid an internal probe into the backdating of employee stock option grants.
Asta Funding (NASDAQ:ASFI - News) was downgraded to market perform from outperform at Ryan, Beck & Co. The firm lowered its price target on the stock to $34 from $50, citing a lack of valuation catalysts.
Avery Dennison (NYSE:AVY - News) was downgraded to neutral from overweight at J.P. Morgan.
Biopure Corp. (NASDAQ:BPUR - News) shares tumbled after the FDA's blood products advisory committee recommend against proceeding with the Navy's proposed Phase III study of Hemopure, the company's pre-hospital treatment for hemorrhaging shock resulting from traumatic injury.
Black & Decker Corp. (NYSE:BDK - News) shares plunged after the tool maker said a slowdown in the housing market and weakening demand for discretionary goods will pose stiff headwinds in the coming year.
California Micro Devices Corp. (NASDAQ:CAMD - News) backed its third-quarter results outlook of a range of a loss of 2 cents a share to earnings of 1 cent a share. The company also confirmed its revenue outlook of $16.5 and $18.5 million.
Conolog (NASDAQ:CNLG - News) shares lost ground after the Somerville, N.J., provider of digital signal processing products posted a loss from continuing operations of $710,613, or 41 cents a share, for its fiscal first quarter ended Oct. 31. This performance was a wider loss than last year as product revenue fell 32% in the latest quarter to $127,661 from $187,938 a year ago.
Dendrite International Inc. (NASDAQ:DRTE - News) said it sees fourth-quarter revenue of $107 to $112 million, with a per-share loss of 23 cents to 35 cents. The company expects 2007 revenue of $430 million to $445 million, and per-share income of 43 to 51 cents.
Encana (NYSE:ECA - News) was downgraded to sell from hold at Citigroup Investment Research. The firm cited cost run-ups and concerns about the quality of the company's portfolio.
Enzo Biochem Inc. (NYSE:ENZ - News) said it plans to sell 3.3 million common shares at $14 each in a registered direct offering to institutional investors. Enzo, a New York health-care research compay said it expects to raise $43.1 million from the offering. The company said it plans to use the money for general corporate purposes, including potential acquisitions, clinical research and development, and the development of product candidates.
Genta Inc. (NASDAQ:GNTA - News) shares plunged after the Food and Drug Administration rejected its application seeking approval for its experimental blood cancer treatment, Genasense.
Illinois Tool Works (NYSE:ITW - News) lowered its outlook for the fourth quarter to a profit of between 72 and 74 cents a share from its prior projection of 77 to 81 cents a share. The company cited lower than expected base revenue growth and anticipated continuing weakness in North America end markets in December. The current average estimate of analysts polled by Thomson First Call is for a profit of 78 cents a share in the December period. For the year, the company now sees earnings of $2.96 to $2.98 a share, below its previous view of $3.01 to $3.05 a share. It expects base revenue growth of 1.8% to 2.4% for the fourth quarter and 3.7% to 3.8% for the year.
International Rectifier (NYSE:IRF - News) was downgraded to neutral from buy at UBS.
Navistar International Corp. (NYSE:NAV - News) said worldwide shipments of its school buses, Class 6-7 medium trucks and Class 8 heavy trucks rose 14% to 147,400 units in 2006 from 129,600 units shipped in 2005. The company also said it shipped 11,000 Class 4-5 small bus and stripped chassis units for the motor home and step-van markets in 2006, and that its diesel engine shipments totaled 519,700 engines for the year, down slightly from 522,600 engines shipped in 2005. The company also added that it's made significant progress on completing the previously disclosed restatement of certain historical financial statements and that it doesn't plan to comment on 2006 results until the statements are finished. It anticipates it won't complete the restatement until after Feb. 1. Navistar added that it's been informed that the New York Stock Exchange plans to suspend trading in its stock by Dec. 20 and begin delisting procedures. The company plans to contest these actions by the exchange.
Optical Communication Products (NASDAQ:OCPI - News) shares slumped after the Woodland Hills, Calif.-based maker of fiber optic components late Thursday reported a fiscal fourth-quarter net loss of $1.4 million, or a penny a share. In the same quarter last year, the company posted a net profit of $1.57 million, or a penny a share. Revenue rose to $19.1 million from $14.8 million. Optical Communication expects revenue of $80 million to $90 million for fiscal 2007, and a "significant" gross margin decline in the first half of fiscal 2007 when compared with the fourth quarter, with the potential for "modest quarter-to-quarter improvements later in the year." The company announced separately that Chief Technology Officer Muoi Van Tran and Chief Financial Officer Susie Nemeti, company founders, will resign. Tran will continue to serve as chairman.
Penn National Gaming (NASDAQ:PENN - News) has reportedly launched a bid for the far larger Harrah's Entertainment (NYSE:HET - News), competing with a private group that is already trying to buy the gambling giant.
PRA International (NASDAQ:PRAI - News) was downgraded to neutral from buy at Goldman Sachs. The move follows the company's announcement late Thursday that Patrick Donnelly has resigned as president and CEO, effective immediately. The company named Terrance Booker to serve as interim CEO, and said Melvin Booth would succeed Jean-Pierre Conte in the chairman role. PRA also said it now expects earnings of $1.08 to $1.11 a share for 2006, including a charge of 5 cents a share related to Donnelly's resignation and a charge of 2 cents a share stemming from a debt write-off. It also narrowed its service revenue outlook for the year to between $300 million and $305 million.
ProQuest Co. (NYSE:PQE - News) agreed to sell its ProQuest Informantion and Learning unit to Cambridge Information Group for about $222 million.
Sturm, Ruger & Co. (NYSE:RGR - News) was downgraded to accumulate from strong buy at C.L. King.
Tektronix Inc. (NYSE:TEK - News) said second-quarter net earnings fell, as selling, general and administrative expenses rose, to $19.6 million, or 24 cents a share, from $19.9 million, or 24 cents a share, during the same period in the prior year. For the third quarter, Tektronix sees sales of $275 to $285 million, and earnings per share from continuing operations of 34 cents to 39 cents, before items such as acquisition and business realignment costs.
United American Healthcare Corp. (NASDAQ:UAHC - News) shares fell after the Detroit-based provider of healthcare services for Medicaid recipients said late Thursday it has raised $6.5 million through the sale of 1 million newly issued shares to institutional investors for $6.50 each. The deal also included warrants to buy 100,000 shares at an exercise price of $8.50 each, expiring in December 2011. United American said the proceeds will be primarily be used for start-up costs associated with the its Tennessee subsidiary's new Medicare Advantage contract with the Centers for Medicare & Medicaid Services.
VistaCare Inc. (NASDAQ:VSTA - News) said its fourth-quarter net loss widened to $10.9 million, or 66 cents a share, from $5.1 million, or 31 cents a share, in the same period last year. Excluding a non-cash valuation allowance of $8.3 million, per-share earnings were 16 cents.
Zoltek Cos. (NASDAQ:ZOLT - News) shares dropped after the St. Louis-based maker of carbon fibers late Thursday reported a fiscal fourth-quarter net loss of $22.9 million, or 89 cents a share, compared with $11.1 million, or 61 cents a share, in the year-ago period. The latest quarter included $23.1 million of litigation charges. Revenue rose to $23.8 million from $14.9 million. Analysts polled by Thomson First Call had forecast revenue of $31.3 million. The company expects fiscal first-quarter revenue of more than $30 million. Analysts are looking for revenue of $37.1 million. Zoltek also said it will delay the filing of its fiscal 2006 10-K in order to complete documentation and other arrangements related to the funding of an appeal bond for its litigation.
-MarketWatch

Labels: AAPL, AFFX, ASFI, AVY, BDK, BPUR, CAMD, CNLG, DRTE, ECA, ENZ, GNTA, ITW, OCPI, PENN, PLB, TEK, UAHC, VSTA, ZOLT