Jim Cramer Blog

Victors: Apple (AAPL) crushed Wall Street estimates by reporting a 67% jump in profits. Najarian says it's an amazing number and everything is working. He owns the stock and continues to stay long. American Express (AXP) beats expectations and trades higher after hours. Merck (MRK) reports a 62% jump in third quarter profits and the stock trades higher. Macke continues to be bullish on Merck. Adami suggests looking at Pfizer (PFE) on a valuation basis.Homebuilding stocks were strong on Monday with the Homebuilders ETF (XHB) trading up 3%. Finerman mentions that a private equity group Hellman & Friedman bought Goodman Global (GGL) for $2.65 billion and tells viewers to trade off that news by going long MDC Holdings (MDC).
Victims: Texas Instruments (TXN) shares dip on the chip maker's outlook that was below Wall Street estimates. Najarian hinted that Texas Instruments isn't managed as well as Apple (AAPL) and he would rather own Apple. Adami counsels investors to buy Intel (INTC) off the TXN numbers. Alos, crude oil and gold both fell 1% Monday as the dollar gains strength.
Merrill Lynch (MER) is set to report earnings on Wednesday. CNBC's Charlie Gasparino discussed his take on Merrill. Insiders at Merrill tell him that some are calling for CEO Stan O'Neal's head. Even outside shareholders want him out. Macke tells investors not to bother buying this stock. Gasparino is now giving O'Neal 8-to-1 odds of being removed as CEO.
SanDisk Corporation (SNDK) co-founder, president and COO Sanjay Mehrotra joined the shpw to discuss his firm's prospects. Mehrotra says demand remains strong especially for the mobile phone segment of the business. He sees continued growth for SanDisk in 2008 and higher profitability.
OIL: Higher oil prices may actually cause BP (BP) and Exxon (XOM) to report a decline in profit for the first time in 5 years. Finerman wants to short tanker stocks like Teekay (TK) because of declining tanker rates.
Retail: Amazon.com (AMZN) is set to report earnings Tuesday after the bell. Macke loves the stock and thinks they will blow out the earnings. Finerman prefers Target (TGT) and Wal-Mart (WMT) and she hopes they trade lower so that she can buy more for her hedge fund. Adami is partial to United Parcel Services (UPS)
Pops & Drops
Pops- Altria (MO) trades up 1% after a UBS upgrade. Finerman is bullish on Altria.
Kimberly Clark (KMB) trades up 5% after posting strong profit numbers.
ExpressJet Holdings (XJT) trades up 16% after the firm announced possible plans of going private.
Sears Holdings (SHLD) popped 4% after a positive mention in Barron's. Finerman would rather be long Target (TGT).
Royal Caribbean Cruises (RCL) traded up 8% after reporting strong profits. The stock is working for Macke.
Radiation Therapy Service exploded higher by 44% after Vestar Capital Partners took the company private.
Lululemon Athletica (LULU) traded up 5% after the firm raised third-quarter estimates and Adami would buy it.
Final Trade
Macke counsels investors to buy Short Dow30 ProShares (DOG).
Adami likes Intel (INTC).
Finerman recommends Covidien (COV).
Najarian offers up Yahoo! (YHOO) for a play on Alibaba.

Labels: AAPL, AMZN, AXP, CNBC, Fast Money, Fast Money Recap, GGL, INTC, MDC, MER, MRK, pfe, SNDK, TXN, XHB, XOM

Doomsday Scenario: MDC Holdings (NYSE: MDC - News), DR Horton (NYSE: DHI - News), Pulte Homes (NYSE: PHM - News) and Toll Brothers (NYSE: TOL - News)
Cramer created a doomsday scenario which probably will not happen, since the bank crisis in 1990 was "ten times worse" than the problems of today. However, he would avoid any companies which deal with borrowing and lending money, particularly housing: DHI, PHM and TOL. The only housing stock that isn't hopeless now is MDC, but Cramer would still not buy. He would also avoid financials amid bearish fears that loans will not be repaid and yields will shrink; "You can't own anything that even walks by a mortgage," Cramer warned. He would not touch companies which need financing for deals. However, Cramer added; "the worst-case scenario will be derailed," and the doom and gloom will not really materialize
If Ben will Budge: Centex (NYSE: CTX - News), Lennar (NYSE: LEN - News), Bear Stearns (NYSE: BSC - News), Goldman Sachs (NYSE: GS - News), Citigroup (NYSE: C - News)
Cramer discussed two scenarios which could reverse doomsday: overseas buyers and an interest rate cut. He is confident that if the Federal Reserve reduces rates by only one percent, housing will make a comeback (especially DHI, PHM, CTX, LEN), financials GS and C will recover and the Dow will jump to 15.
Playing it Safe: Celgene (NasdaqGS: CELG - News), Kellogg (NYSE: K - News), Schlumberger (NYSE: SLB - News), Medco Health Solutions (NYSE: MHS - News), Kimberly-Clark (NYSE: KMB - News), Amazon.com (NasdaqGS: AMZN - News), Google (NasdaqGS: GOOG - News), Apple (Other OTC: APPL.PK - News) and Research in Motion (NasdaqGS: RIMM - News)
Even if the Fed doesn't budge rates, investors can still create a safe portfolio consisting of CELG, K, SLB, MHS and KMB. He also directed viewers to his six wild bull markets: oil and oil services, agriculture, machinery, aerospace, infrastructure and minerals, and his four horse men of tech: AMZN, GOOG, APPL and RIMM.
Mad Mail: Brookfield Asset Management (NYSE: BAM - News), Rite Aid (NYSE: RAD - News), ValueClick Inc. (VLCK)
Cramer urged a mailer not to sell BAM, because it is an international company, unaffected by subprime woes, and is similar to Warren Buffet's Berkshire Hathaway; "If you sold Warren Buffet because of a housing problem, forget it!" To a mailer concerned about RAD, Cramer said, "The integration is going very well. I'm holding your hand on RAD, and begging you not to sell it." Concerning VLCK's bad quarter, he commented, "I don't have my arms around it yet. To me, the stock looks like it's going to see $18, before you see a bottom."
Published By SeekingAlpha

Labels: AAPL, AMZN, BAM, BSC, CELG, CTX, DHI, GOOG, GS, Jim Cramer, K, KMB, LEN, Mad Money, MDC, MHS, PHM, RIMM, SLB, TOL

Abitibi-Consolidated (NYSE:ABY - News) shares rose after the company agreed to merge with Bowater (NYSE:BOW - News) to form the No. 8 publicly traded global forest-products company. The combined company will have pro-forma annual revenue of US$7.9 billion and an enterprise value of US$8 billion, they said in a statement. The new entity, AbitibiBowater, will be held 52% by Bowater's shareholders and 48% by Abitibi's. In the deal, each Abitibi share will be exchanged for 0.06261 share of the new company. Each Bowater share will receive 0.52 share of AbitibiBowater. David J. Paterson, chairman, president and chief executive of Bowater, will be president and CEO of AbitibiBowater. John W. Weaver, president and CEO of Abitibi-Consolidated, will take the post of executive chairman at the merged entity.
Altiris (NasdaqGS:ATRS - News) shares soared after the company agreed to be acquired by Symantec Corp. (NasdaqGS:SYMC - News) for $830 million, or $33 per share.
British Airways Plc (NYSE:BAB - News) said it welcomed the decision by the cabin crew branch of the T&G union to call off the strikes scheduled for Tuesday and Wednesday and for two 72-hour periods next month. BA said the details of the settlement will be released in due course. BA said it will attempt to reinstate as many flights as it can for Tuesday and Wednesday but regrets that the decision to cancel the strikes has come too late to prevent disruption to the travel plans of thousands of customers.
Countrywide Financial (NYSE:CFC - News) shares extended a recent rally following a report in U.K. newspaper The Financial Times that the company has held talks about an alliance or merger with Bank of America (NYSE:BAC - News).
Cummins Engine (NYSE:CMI - News) said its fourth-quarter net income rose to $189 million, or a $3.75 share, from $167 million, or $3.31 a share, a year earlier, helped by higher engine sales. A Thomson Financial survey of analysts, on average, expected earnings of $3.77 a share for the quarter. Analysts' estimates usually exclude items. The Columbus, Ind., maker of engines said revenue rose to $3.03 billion from $2.75 billion a year earlier. The company forecasts 2007 earnings of $11 to $11.50 a share. Analysts expect earnings of $10.02 for the year, on average.
Educate Inc. (NasdaqGS:EEEE - News) agreed to a management buyout at $8 a share, or $535 million. Private equity firms Citigroup Private Equity and Sterling Capital Partners are also taking part in the deal, which values the Baltimore educational services firm at a premium of 39 cents a share, or 5% over its closing price of $7.61 on Friday. The transaction, which is expected to close in the second quarter, is subject to approval by the company's stockholders. Apollo Sylvan, LLC and Apollo Sylvan II, LLC, holders of approximately 53% of the company's common stock, have agreed to vote their shares in favor of the proposed merger.
First Republic Bank (NYSE:FRC - News) shares rose after the company agreed to be acquired by Merrill Lynch (NYSE:MER - News) in a cash and stock deal worth about $1.8 billion. The deal, which is expected to close in the third quarter, values First Republic at $55 per share. First Republic is a private banking and wealth management firm focused on high net worth individuals and their businesses. According to a joint press release from the two companies, as of September 30, 2006, First Republic had assets of $10.7 billion, loans of $7.6 billion, deposits of $7.9 billion, and assets under management or administration of $16.4 billion.
Gentex Corp. (NasdaqGS:GNTX - News) shares jumped after the auto parts maker posted higher fourth-quarter profit and sales thanks to increased demand for the company's higher margin mirrors. Mirror shipments rose 5% despite the steep automotive production cuts that slammed the domestic auto industry. Gentex posted a profit of $30.8 million, or 22 cents a share, up from $29.6 million, or 19 cents a share, a year ago. Sales rose 8% to $149.6 million. Analysts polled by Thomson Financial had expected a profit of 18 cents a share on sales of $145.7 million.
HealthSouth Corp. (NYSE:HLS - News) has agreed to sell its outpatient rehabilitation division facility for about $245 million to Select Medical Corporation, a privately-owned operator of specialty hospitals and outpatient rehabilitation facilities, as part of a strategy to position itself as a pure play post-acute care provider. The deal is expected to close in 60 to 90 days, and is subject to closing conditions, including regulatory approval.
Jacobs Engineering Group Inc. (NYSE:JEC - News) said it has approved a 2-for-1 stock split, to be effected in the form of a stock dividend. The additional shares will be distributed on March 15 to shareholders of record as of Feb. 15.
Laureate Education (NasdaqGS:LAUR - News) said its board has agreed to a $3.1 billion buyout led by Douglas Becker, its founder and CEO, and backed by private equity consortium including Kohlberg Kravis Roberts & Co., Citigroup Private Equity and hedge fund S.A.C. Capital Management LLC. Under the deal, announced Sunday, Laureate shareholders would receive $60.50 a share in cash, an 11% premium to the closing price of the stock Friday. Including assumed debt, the total value of the deal is $3.8 billion.
Mattel Inc. (NYSE:MAT - News) reported fourth-quarter net income of $286.4 million, or 75 cents a share, up from $279.2 million, or 69 cents, earned in the final three months of 2005. Average shares outstanding were 384 million in the latest quarter, down from 402.5 million a year earlier. Quarterly sales for the El Segundo, Calif.-based toymaker reached $2.11 billion, up 14% from the prior year's $1.84 billion; currency contributed two percentage points to the growth rate. Worldwide gross sales for the company's Barbie doll brand were up 3%, Mattel said. Operating income for the latest quarter came to $388.7 million, up 21%. Analysts, on average, had been looking for Mattel to earn 67 cents a share on revenue of nearly $1.99 billion, according to estimates compiled by Thomson First Call.
Shares of M.D.C. Holdings Inc. (NYSE:MDC - News) rose after analysts at JMP Securities upgraded the company to market outperform from market underperform. "Based on our analysis, we believe M.D.C. is much closer to the bottom than its peers," wrote JMP analyst Alex Barron in a research note Monday. "Its strong balance sheet and free cash flow generation should put the company in a very strong position to start buying land again once the market bottoms and land prices begin to come down hard."
Molecular Devices Corp. (NasdaqGS:MDCC - News) shares rose after the company agreed to be acquired by MDS Inc. (NYSE:MDZ - News) for $615 million. The deal values Molecular Devices' common shares at $35.50 each in cash, compared to Friday's close at $23.88. MDS said the combined company will have more than 1,100 employees. Excluding items, MDS expects the deal to be modestly accretive in 2007 and significantly accretive in 2008 and beyond. MDS anticipates the transaction will close in the second calendar quarter of 2007. Molecular Devices, a Sunnyvale, Calif., provider of bio-analytical measurement systems, posted revenue of $45.5 million for the quarter ended in September.
Mosaic Co. (NYSE:MOS - News) said second-quarter net income rose to $65.9 million, or 15 cents a share, from $55 million, or 13 cents, a year earlier. The average earnings estimate of eight analysts surveyed by Thomson was 15 cents a share for the latest quarter. The Plymouth, Minn., phosphate and potash company said revenue for the three months ended Nov. 30 rose 2% to $1.52 billion.
Published By MarketWatch

Labels: ABY, ATRS, BAB, BAC, BOW, CFC, CMI, EEEE, FRC, GNTX, HLS, JEC, LAUR, MAT, MDC, MDCC, MDZ, MER, MOS, SYMC