Jim Cramer Blog

Cramer's Index: MGIC Investment (NYSE: MTG - News), Countrywide Financial (NYSE: CFC - News), Bear Stearns (NYSE: BSC - News), KB Home (NYSE: KBH - News), Centex (NYSE: CTX - News), MBIA (NYSE: MBI - News), Blackstone (NYSE: BX - News), Thornburg Mortgage (NYSE: TMA - News), Beazer Homes (NYSE: BZH - News), Washington Mutual (NYSE: WM - News), Goldman Sachs (NYSE: GS - News), Citigroup (NYSE: C - News)
While Cramer says he doesn't want to be a "buzz kill," he admits it is not possible to be really bullish as long as the housing crisis persists. Cramer formed his own "index" of the above-mentioned stocks, and said when the 12 companies stablilize and the Fed cuts interest rates, it will be time to let the bulls run once again. He made a personal appeal to Fed chairman Ben Bernanke; "Cut the rates. Take the pressure off. Many, many people could be about to lose their homes, because you're not listening..."
New Age Under Armour: Lululemon Athletica (LULU)
Cramer has discovered a new Under Armour, which like its predecessor, has experienced a massive initial bounce and is expected to keep growing. Yoga apparel company, LULU came public at $18 and jumped to $31 "in one of the worst tapes I've ever seen," said Cramer. However, he doesn't think this stock is a "one trick pony" but will keep going up as UA did, because LULU has been doubling stores year over year. Since the stock is speculative and has risen, Cramer recommends waiting at least 3 days or until the price drops before buying.
Beer is Near: Boston Beer (NYSE: SAM - News)
While in the current climate, investors are dubious of even some soft goods stocks, "People drink beer no matter what." Cramer likes SAM's 13% long-term growth rate and its smart move of acquiring a brewery from Diageo for $55 million rather than building a new one, which would have cost $200 million. Although he's a self-proclaimed "Bud man" Cramer gives SAM a triple buy, even near its 52-week high.
CFO Interview: Stephen Chazen, Occidental Petroleum (NYSE: OXY - News)
Chazen discussed production increases in Argentina and Peru; "California continues to be good for us." he added. Chazen dismissed worries about political risks, noting there are always political risks, and he remarked on the stability of OXY's chemical business. "All oil stocks are trading down in unison," Cramer said, and added now is the time to buy oil.
Published By SeekingAlpha

Labels: BSC, BX, BZH, CFC, CTX, GS, Jim Cramer, KBH, LULU, Mad Money, MBI, MTG, OXY, SAM, TMA, WM

A slug of disappointments in technology caused a rotation from “the rotation.” Elsewhere though, strength in the energy complex and less lofty expectations helped keep the schnitzeling to a minimum and the bull at large still hanging in there. For the four-day period, the S&P500 ($SPX) and NASDAQ Composite ($COMPQ) are showing very mixed results from a virtually unchanged decliner of just -.02%, to a much larger -2.06% bit of expired bull.The past week brought home the fact that the market is indeed made up of individual stocks. Large-cap tech—an area of late that’s seen a heavy rotation by institutional money in search of a new home—took the path less traveled. The quick workout on heavyweight tech contenders started off with a sales warning from security software powerhouse Symantec (SYMC), an influential downgrade of key players in the semis (SMH, KLAC, LRCX, NVLS), and two brokers chiming in with reductions to “neutral” on networking giant Cisco (CSCO). A narrowing of gross margins and lackluster guidance by Intel (INTC) didn’t help matters for tech bulls, nor did Apple’s (AAPL) earnings disappointment Wednesday evening. The current crown jewel beat bottom line estimates by 36 cents. However, guidance was reduced by management and shipments of the ever-popular iPod and Mac products were seen as being at the low end of expectations. In Friday’s session, reduced margins resulting in a ‘light’ penny beat at Big Blue (IBM) didn’t compute for bulls. In each case, the individual issues experienced what many might call an inflated disappointment, with investors simply looking to focus on the worst that each report had to offer. With all of the aforementioned being at or near 52-week highs, or better, and Wall Street having made an ‘all in’ move into the group of late, some might also call the action deserved. Black Gold (USO) pushed lower and hit below $50 a barrel for the first time in more than two years. On the week, the futures contract finished down a point at 51.99. Interestingly enough, the ‘profit-engine’ of the energy complex (XLE, OIH) managed to find a bid for the four-day period after its own severe slide. Value hunters and shorts covering were helped along in Friday’s trade by Schlumberger’s (SLB) better-than-expected earnings and a group whose bearish consensus outlook is fertile ground for contra trend reactions. The broader market as represented by the S&P500 can certainly thank the influence that the energy complex carries with it, in keeping profit-taking to a bare minimum. Lowered expectations of earnings (outside of technology) has also helped somewhat. Reactions on the week were generally mixed and the reports themselves didn’t offer up any type of unified and strong guidance for investors. However, Wall Street was able to keep the pains felt in tech names an isolated condition. That might be seen as a small victory for bulls. Names offering up decent results this past week include Wells Fargo (WFC), Harley (HOG), Johnson Controls (JCI) and Capital One (COF). Economic data this past week continued to hint at a slightly stronger economy than expected—focused on inflation pressures, but not reacting to the news either way. Better-than-expected reports on housing starts, industrial production and regional manufacturing reflected underlying growth. Also, weakening trends in energy and commodity prices helped keep price concerns muted and the bulls somewhat supportive of market prices. Other data however, hindered any further rally attempts. A tighter-than-expected labor market via the weekly claims report [sub 300K second week] is keeping the theme of wage-based inflation on traders’ minds. Further, neither the CPI nor PPI releases were able to show any type of clear moderation in prices of yet. With a year-over-year reading of the core CPI at 2.6%, that figure remains elevated, but not significant enough to warrant the Fed to shift policy. All said and done, with the widely followed 10-Year unchanged on the week at 4.77% and the S&P500 virtually unchanged, traders’ will have plenty of fresh catalysts this week to inspire. ON TAP THIS WEEKHeading into the week, potential market catalysts are riding heavily on 4th quarter earnings reports. This week will be the first of the season offering a full five days of corporate results and a calendar filled with promise from the likes of Texas Instruments (TXN), Bank of America (BAC), Yahoo (YHOO), Occidental (OXY), Amgen (AMGN), Caterpillar (CAT), Ford (F) and Johnson & Johnson (JNJ). Thus far, Reuter’s estimates that fourth quarter operational earnings for the S&P500 are on track for an increase of 9.3%. That’s roughly in-line with analysts estimates seen heading into the season, but more than 85% of S&P500 companies are still on tap to report. Further, an in-line Q4 after thirteen periods of double digit growth and a market at multi-year highs doesn’t sound like the basis for bullish behavior in 2007. MondayEconomic: Leading Indicators (.2%)Earnings: Pfizer (PFE), Eaton (ETN), A.O. Smith (AOS), Lee (LEE), Sify (SIFY), Plantronics (PLT), Texas Instruments (TXN), CSX (CSX)TuesdayEconomic: NAEarnings: Bank of America (BAC), EMC (EMC), Jacobs (JEC), J & J (JNJ), Precision Cast (PCP), Rediff (REDF), UAL (UAUA), Advanced Micro (AMD), Citrix (CTXS), Centex (CTX), QLogic (QLGC), Steel Dynamics (STLD), Supertex (SUPX), Yahoo (YHOO), Seagate (STX), RFMicro (RFMD)WednesdayEconomic: Weekly CrudeEarnings: Alleghany (ATI), Conoco (COP), Corning (GLW), General Dynamics (GD), Piper Jaffray (PJC), Waters (WAT), eBay (EBAY), F5 Net (FFIV), Netflix (NFLX), Novellus (NVLS), Qualcomm (QCOM), Rambus (RMBS), Symantec (SYMC), Varian Med (VAR)ThursdayEconomic: Weekly Claims (310K), Existing Home Sales (6.30M)Earnings: Applied Bio (ABI), AT&T (T), BJ Srvc (BJS), Dow Chem (DOW), Ford (F), Imclone (IMCL), Legg Mason (LM), Potash (POT), Occidental (OXY), Nokia (NOK), Quest Diag (DGX), SunPower (SPWR), Union P (UNP), Peabody (BTU), Amgen (AMGN), Harman (HAR), Bebe (BEBE), Columbia (COLM), MEMC (WFR), Microsoft (MSFT), Stryker (SYK), Tempur-Pedic, (TPX), VistaPrint (VPRT), Western Digital (WDC)FridayEconomic: Durable Orders (3.5%), New Home Sales (1.05M)Earnings: Carpenter Tech (CRS), Caterpillar (CAT), Fortune Brands (FO), Halliburton (HAL), Honeywell (HON), T. Rowe (TROW), CDW Corp (CDWC), FPL Group (FPL)
Published By Optionetics

Labels: AAPL, AMGN, BAC, COF, CSCO, HOG, IBM, INTC, JCI, KLAC, LRCX, NVLS, OXY, SLB, SMH, SYMC, TXN, USO, WFC, YHOO

Bullish calls:
Cemex (NYSE: CX - News): 'CX is one of the best stocks out there. ... CX - the Mexican cement company that's buying American companies... that one's for me. I'm giving it two thumbs up.'BEA Systems (NASDAQ: BEAS - News): 'They are saying this BEAS hasn't taken off since Cramer recommended it. So, therefore, it must have no mojo, and they could not be more wrong. If you look at the Oracle quarter, after that disappointment, you can see it cries out for an acquisition. It needs China play. You know what that spells: BEAS.'Cisco (NASDAQ: CSCO - News)Allegheny Technologies (NYSE: ATI - News): 'I say you should only playing with the house's money right now. This company produces stainless steel - but much more important - it makes titanium for BA. It makes airplane titanium, therefore, it is still too cheap. I bless it, anytime it's under $90.'Occidental Petroleum (NYSE: OXY - News): I think OXY's good. There's like a scale here, of which are the companies most levered to crude: The company that should go up or down with the crude is OXY. The least levered is XOM. I like to have a little bit of both.'Exxon Mobil (NYSE: XOM - News): 'I don't like to be unlevered like XOM, although I know it's going higher. 'Chevron (NYSE: CVX - News): 'So I settle on CVX, which is my fave, for those of you who want steady income. It yields 2.75%, and it just seems to always have a bid underneath, but it doesn't go down.'Devon Energy (NYSE: DVN - News): 'And, for those who want to roll the dice, I talk about the stock that got downgraded today, criminally and wrong, which is DVN. DVN's good.'
Bearish calls:
Smith & Wesson (NASDAQ: SWHC - News): 'I don't like the stock. SWHC was one we nailed in the $5-6 range. When it got to $14, we said we be hogs.'JDSU (NASDAQ: JDSU - News): 'JDSU - I have been over that quarter with a fine-tooth comb... I think that JDSU - and let me roll up in CIEN - these I call - these are 'too hard' because they're too likely to give you (an electric shock sound).'Ciena (NASDAQ: CIEN - News): 'I feel very strongly that anybody who calls me with the JDSU or the CIEN... I would tell you that they should buy CSCO.'Allied Waste (NYSE: AW - News): 'You know, I was going to recommend this stock. I feel like this is the best one of the waste removal companies, but here's your problem: It grows at 13%, and it sells at 24x earnings. On Jim Cramer's Mad Money, the upper limit is 26x. So, if I told you to buy this at $12, I'd have to tell you to ring the register at $14. So, the answer is 'don't buy, don't buy.'

Labels: ATI, AW, BEAS, CIEN, CSCO, CVX, CX, DVN, JDSU, Jim Cramer, Lightning Round, Mad Money, OXY, SWHC, XOM