Jim Cramer Blog

CVRD (NYSE: RIO - News), BHP (NYSE: BHP - News), Freeport McMoran (NYSE: FCX - News), Phelps Dodge (NYSE: PD - News): Cramer urges investors who "have walked away from the table" because of subprime lending to take a look at RIO and BHP, because most of the demand for copper and nickel is coming from China, and the "America-centric" view will lose investors money. He comments BHP has "really found a floor here at $42" and is"very, very interesting." Cramer adds "with copper right here, the FCX/PD combination would go up." RIO will benefit from the very strong nickle demand in China.
Global SantaFe (NYSE: GSF - News),Transocean (NYSE: RIG - News) and Hercules (NasdaqGS: HERO): Although an analyst predicted an 80% jump for HERO, Cramer was positive yet lukewarm on the company. "The day rates for shallow are going to go down .... the day rates for deep are all going to go up." For this reason, Cramer said he likes RIG and GSF, both of which have "gigantic buybacks" and the "motivation to make a deal."

Labels: BHP, FCX, GSF, Jim Cramer, Jim Cramer's Stop Trading, PD, RIG, RIO

Bullish calls:
Zimmer Holdings (NYSE: ZMH - News):' ... is going to par [100] from 84. ... And I do not think that stock is expensive.'Hewlett Packard (NYSE: HPQ - News): 'I'd rather see you in Hewlett-Packard ... 'VeriFone Holdings (NYSE: PAY - News): 'Grows at 20%, sells at 20 times earnings. ... I am hitting it again. VeriFone is for me and for you.'Southern Copper (NYSE: PCU - News): 'Why did I leave this stock? Why did I sell it for my trust? PCU is so good ... the mining costs are low. Still making money hand-over-fist.' [ Cramer gestured to back up the truck, or buy.]Syneron Medical (NasdaqGS: ELOS): 'I think that Syneron Med is for real. I want to buy it here at 24.'Phelps Dodge (NYSE: PD - News): I like Phelps DodgeNTL (NYSE: NTL - News): 'We know the triple play is for real. ... If you think I'm going to back away, you are wrong.'BEA Systems (NasdaqGS: BEAS): 'I'm still endorsing it. It's just flat-lined here. I'm not worried.'NYSE Group (NYSE: NYX - News): 'I think [CEO] John Thain is going to deliver for us. ... I am not backing away.'
Bearish calls:
EMC (NYSE: EMC - News): 'Very problematic for me. ... I'd rather see you in Hewlett-Packard.'Intel (NasdaqGS: INTC): 'Problematic. Locked in a price war ... with AMD ... I say use the price war to your advantage. ... Who is a client [of the two] ? It's Hewlett-Packard.'
Published by SeekingAlpha

Labels: EMC, HPQ, Jim Cramer, Mad Money, NTL, NYX, PAY, PCU, PD, ZMH

Which stocks to buy?
George F. Foley, a portfolio manager for the Glenmede Large Cap Value and Core Value funds, is leaning heavily toward materials companies, particularly well-known names such as Alcoa (AA), Alcan (AL), and Phelps Dodge (PD) that he thinks can benefit from gains in efficiency. Merrill Lynch & Co. chief investment strategist Richard Bernstein favors high-quality tech companies, discount retailers, global defense companies, and multiline insurers. He also likes industrials and telecom shares as the demand for raw materials and expertise increases in a burgeoning global infrastructure.
Tech seems to be a common theme for 2007. John B. Cunningham, chief investment officer at J. & W. Seligman & Co. in New York, likes hardware specialists such as computer, hard drive, and memory makers as consumer demand for electronics and capital spending by big corporations continue at a healthy clip. "The fundamentals are still very solid," he says. "We think tech can outperform the broader market." He also recommends telecom equipment makers as regional phone operators expand their systems to compete with cable operators.
Don't forget financials, says Edward Yardeni, chief investment strategist of Oak Associates Ltd. He says the stocks of investment banks and asset managers are good ways to bet on merger mania and retiring baby boomers. And although energy has been one of the best-performing sectors in the S&P for the last three years, plenty of opportunities remain, he says. There's still momentum in the drilling, equipment, and services companies. "Look around," says Yardeni. "We have a capital-spending boom going on."
Internationally focused investors should expect global economic growth to slow but not to crash, and opportunities to persist. Developed markets seem especially cheap, trading at an average of 12.4 times expected 2007 earnings, compared with a 10-year average of 18.7, according to MFS. "There's still massive liquidity looking for a home, and valuations are still attractive in a number of markets," agrees Simon Davis, co-chief investment officer based in London for Putnam Investments.
Davis says that while many China-based companies have been bid too high, it's smart to look at suppliers to an economy that continues to grow 10% a year. He favors mining and natural resources outfits in Australia, including Zinifex, BHP Billiton (BHP), and Rio Tinto (RTP), which is dual headquartered in Melbourne and London.
The likely losers?
Bessemer's Stern cautions investors to stay away from housing-related stocks such as homebuilders, construction companies, and savings and loans. Although it may be tempting to think that there are bargains among them, he says "the profits they've posted in the last couple of years exaggerate their long-term earnings potential."
Profit margins at small regional banks will keep being squeezed by higher short-term interest rates. And the pressure on companies to use their free cash to buy back shares and issue dividends rather than pay down debt doesn't bode well for high-grade corporate bonds.
The biggest risk to investors: inattention. Yardeni, who predicted the strong stock market of 2006, says the S&P could reach 1600 by midyear, a 13% gain, which will get investors worried about higher interest rates. And the ensuing sell-off, he says, will offer opportunity once again.
By Mara Der Hovanesian
By BusinessWeek Online

Labels: AA, AL, PD

Caterpillar (NYSE: CAT - News), Phelps Dodge (NYSE: PD - News), Guess (NYSE: GES - News), Costco (NASDAQ: COST - News), Home Depot (NYSE: HD - News), Lowes (NYSE: LOW - News), WalMart (NYSE: WMT - News), Alcoa (NYSE: AA - News), Altria (NYSE: MO - News), AIG (NYSE: AIG - News), Honeywell (NYSE: HON - News), IBM (NYSE: IBM - News), Johnson & Johnson (NYSE: JNJ - News), Pfizer (NYSE: PFE - News), McDonald's (NYSE: MCD - News), Microsoft (NASDAQ: MSFT - News), Hewlett Packard (NYSE: HPQ - News)
Cramer noted the volatility in the market on Wednesday and attributed it to the fact that the Bell South sale sparked a lot of futures selling, but since the deal is over, the money will flow back. He thinks that the lift in futures was due to a cessation of selling rather than buying. Cramer was disappointed to see that companies that were less consumer sensitive were left standing, and would have preferred to have seen Caterpillar and Phelps Dodge weather the storm. Cramer wanted to see manufacturing or offensive stocks do well and housing and retail get hit so at least the decline could be contained within those sectors.
Aaron Task noted that the holiday season was not a bright one for specialty retailers, and Cramer responded that there is a "secular change in retail" with the high-end "booming." He says the action is in the "aspirational retailers" such as Guess and Costco, but since retail performance was mixed, he doesn't want to focus on these companies too much. Cramer predicts that HD will perform well this year, although "the stock can't sustain a 2-point gain until the numbers turn." He likes HD because housing is bottoming, but prefers LOW.
Turning to other stocks, Cramer said Walmart was "awful," AA will be bought, and that MO will split up. "People don't understand that because Altria has held back its buyback, it has a tremendous amount of cash," Cramer said. The future of AIG, says Cramer, will depend on when Hank Greenberg stops selling shares. Cramer remarked that HON was undervalued, IBM was a cheap, low multiple tech stock, and that "king of marketing" JNJ would succeed with Pfizer's products. Microsoft will gradually rise because of Vista and HPQ should get some benefit, since Vista is "huge."
Published By SeekingApha

Labels: AA, AIG, CAT, COST, GES, HD, HON, HPQ, IBM, Jim Cramer, JNJ, LOW, MCD, MO, MSFT, PD, pfe, Wall Street Confidential, WMT

Buoyed by falling oil prices, stocks shrugged off mixed holiday retail numbers and meandered higher today in light trading. As is typical of the markets this time of year, there were few catalysts to move stocks, and investors looked ahead to next year. The three major indices all ended the session up around 0.5%.
Among the biggest movers was drugmaker Telik (Nasdaq: TELK - News), which plummeted -71% after the company's cancer drug failed to show improvement in patients in two late-stage trials. The news prompted downgrades from a number of analysts.
Three Wall Street analysts initiated coverage on recent IPO Hertz Global Holdings (NYSE: HTZ - News). Lehman Brothers started the car rental company with an "overweight" rating -- the equivalent of a "buy" rating -- and a $20 price target. Goldman Sachs also started Hertz with a "buy" and a $20 target, based on the company's ability to benefit from favorable pricing from its car suppliers. JP Morgan, meanwhile, started the stock with a "neutral" rating based on valuation concerns.
Elsewhere, news of a pair of minor deals hit the wires. Internet networking company Savvis (Nasdaq: SVVS - News) agreed to sell its content delivery network assets to Level 3 Communications (Nasdaq: LVLT - News) for between $125-130 million, and oil and gas producer Anadarko Petroleum (NYSE: APC - News) said it will sell two Louisiana gas fields to EXCO Resources (NYSE: XCO - News) for $1.6 billion. Meanwhile, Freeport-McMoRan Copper & Gold (NYSE: FCX - News) received antitrust clearance in its takeover of Phelps Dodge (NYSE: PD - News)
In tech news, reports emerged of security flaws in Microsoft's (Nasdaq: MSFT - News) new Vista operating system, but investors shrugged off the news and pushed the stock higher. Microsoft added 1%. News of Amazon.com's (Nasdaq: AMZN - News) "best ever" sales for this year's holiday shopping season met with the opposite reaction, as the stock closed down -1%.
Microsoft is a Bull Market Report Recommended List stock.

Labels: AMZN, APC, FCX, HTZ, LVLT, MSFT, PD, SVVS, TELK, XCO

Bullish calls:
Lockheed Martin (NYSE: LMT - News): 'You cannot stop defense stocks! ... and the cheapest and the best, right here, right now, is LMT!'L-3 Communications (NYSE: LLL - News)Northrop Grumman (NYSE: NOC - News)Boeing (NYSE: BA - News): 'First of all, after the close, a 17% dividend boost. Is there anything this company doesn't do? ... I think that BA is going to $100. Big orders ... That is one of my favorite companies in the DOW.'NYSE (NYSE: NYX - News): ' No one is championing this stock except for me! I'm all alone, and that makes me like it even more! Could this stock go to $200? Mark my words, I think it will!'DivX (NASDAQ: DIVX - News): 'I think that DIVX goes higher. I like the stock. I'm not dissuaded by the fact that it's near its 52-week high. I think it goes back to $31 before year end.'Disney (NYSE: DIS - News): ' I recommened that stock at $32. It should not have gone down, after it reported that quarter. It is inching its way up to $38.'Coldwater Creek (NASDAQ: CWTR - News): 'Look, I know that people are saying, 'hold it, Cramer.' He blew that CWTR. All I can say is, sometimes stocks get put on sale, when they go from regional-to-national. And, here's what I'm doing (backing up the truck) CWTR.'Arris Group (NASDAQ: ARRS - News): 'Don't, don't give up ... I just wish they hadn't done that convertible deal - they hurt me.'BEA Systems (NASDAQ: BEAS - News): 'We are going to wake up one day, and BEAS is going to be appreciably higher. It has obviously been hurt by the options ugly stick (backdating)... But BEAS should not be punished ... if they don't get the stock up, will be purchased by Oracle.'VeriSign (NASDAQ: VRSN - News): 'You wait until it goes back to $22 or $23, and then you buy a little more. It's an up stock that's doing really well, that's got a lot of momentum with good earnings power. I say stick with it.'Phelps Dodge (NYSE: PD - News): 'Steve Cohen - one of the best investment managers - has said that that bid that it's gotten is too low. I'm with Steve. This stock should be bought ...There's another 20 points,'Verizon (NYSE: VZ - News): ' VZ is a good, cheap stock with a good dividend.'Yamana Gold (AMEX: AUY - News): 'It remains my favorite gold stock. Two thumbs up, way up.'
Bearish calls:
Brocade Communications (NASDAQ: BRCD - News): I'm worred about BRCD ... I like the long-term story, but ... Don't buy, don't buy. I am not clear about BRCD and cannot recommend it on this very show.'Panacos Pharmaceuticals (NASDAQ: PANC - News): 'Oh man, now you're talking about dicey ... I cannot bless a company that has no revenues to speak of in the last two quarters and no earnings ... Don't buy, don't buy.'Advanced Micro Devices (NYSE: AMD - News): ' I keep thinking that's opportunity knocking, but everytime I do it, I feel like (whipping sound). Here's the problem: they are in a price war - and a price war nobody wins!'Intel (NASDAQ: INTC - News): 'INTC and AMD have thin margins and I don't want to buy them! Don't buy, don't buy.'Sun Microsystems (NASDAQ: SUNW - News): 'I think that this is just one of those stocks that was way too high, went down a lot, and is now just trying to find itself - $5-6, $5-6. In other words, stay away.'Hansen Natural (NASDAQ: HANS - News)New York Community Bancorp (NYSE: NYB - News)Toro (NYSE: TTC - News): 'You missed it. It had a big run. I'd rather ring the register. Nice dividend boost though.'
-Miriam Metzinger

Labels: AMD, ARRS, AUY, BA, BEAS, CWTR, DIS, DIVX, INTC, Jim Cramer, Lightning Round, LLL, LMT, Mad Money, NOC, NYX, PD, VRSN, VZ

Here are 7 options to watch for today. This list comes directly from the TradingMarkets Options Indicators page. The list is created using OptionVue options analysis software.
Most Under Priced Calls: These are the most under priced calls of all stocks in our database. While the Equities Explosion List finds groups of calls for individual equities that are under priced, this list finds the most under priced individual calls. Thus, the options listed here will tend to be more severely under priced.
Phelps Dodge (NYSE:PD - News) Jan 135.0. PD's PowerRating is 5.
Most Under Priced Puts: These are the most under priced puts of all stocks in our database. While the Equities Explosion List finds groups of puts for individual equities that are under priced, this list finds the most under priced individual puts. Thus, the options listed here will tend to be more severely under priced.
Cognos Incorporated (NASDAQ:COGN - News) Feb 45.0. COGN's PowerRating is 4.
Most Overpriced Calls: These are the most overpriced calls of all stocks in our database. While the Equities Implosion List finds groups of calls for individual equities that are overpriced, this list finds the most overpriced individual calls. Thus, the options listed here will tend to be more severely overpriced.
Gilead Sciences (NASDAQ:GILD - News) Feb 70.0. GILD's PowerRating is 5.
Most Overpriced Puts: These are the most overpriced puts of all stocks in our database. While the Equities Implosion List finds groups of puts for individual equities that are overpriced, this list finds the most overpriced individual puts. Thus, the options listed here will tend to be more severely overpriced.
Frontline Limited (NYSE:FRO - News) Dec 40.0. FRO's PowerRating is 5.
Stocks with Abnormal Call Volume: These are stocks which showed unusual call option volume not easily explained by arbitrage operations. The appearance of a stock on the Call Volume Alerts list suggests a possible takeover, extraordinarily good earnings report, or other news which may favorably affect the stock.
Hilton Hotels (NYSE:HLT - News). HLT's PowerRating is 4.
Stocks with Abnormal Put Volume: These are stocks which showed unusual put option volume not easily explained by arbitrage operations. The appearance of a stock on the Put Volume Alerts list suggestsan extraordinarily negative earnings report, or other news which may negatively affect the stock.
J.C. Penney Company (NYSE:JCP - News). JCP's PowerRating is 6.
Abnormal Put/Call $ Volume: These stocks have the highest dollar put volume in relation to their call volume. These high ratios are indicative of extreme bearish sentiment in the underlying stock.
Pulte Homes (NYSE:PHM - News). PHM's PowerRating is 4.

Labels: COGN, FRO, GILD, HLT, JCP, PD, PHM, stock options

Research In Motion (NASDAQ: RIMM - News): Cramer says that RIMM is rallying like a "running back that has just broken through the Rutgers defense," and expects the surge to continue through the holidays. Allergan (NYSE: AGN - News), Merck (NYSE: MRK - News) and Pfizer (NYSE: PFE - News): Cramer called Allergan a "genius company" with its popular Botox and other products. He notes that it is up $7 at $119, and may be an attractive acquisition for Merck or Pfizer. Phelps Dodge (NYSE: PD - News), Equity Office (NYSE: EOP - News) and Freeport (NYSE: FCX - News): Recent mergers like those of PD-FCX and EOP demonstrate that "everything is cheap to someone in this market," remarks Cramer. Freeport picked up PD because it needed more copper, and since metals are "so hated by mutual funds" the acquisition was inexpensive. Cramer added that there is a lack of supply in good stocks and "All the managements I know think stocks are undervalued," he added. "So many companies want to buy other companies."

Labels: AGN, EOP, FCX, Jim Cramer, Jim Cramer's Stop Trading, MRK, PD, pfe, RIMM

Yahoo (NASDAQ: YHOO - News), Ingersoll-Rand (NYSE: IR - News), Freeport-McMoRan's (NYSE: FCX - News), Phelps Dodge (NYSE: PD - News), Lundin Mining (AMEX: LMC - News) - Cramer says that, in the 25 years he's been involved in the market, he has only seen one or two other periods when the conditions for investing have been so good, and was impressed that there wasn't a decline after the Democratic sweep. Cramer adds that this is the best earnings season in seven years, and added that even Yahoo and IR rose after reporting "stinker" quarters. Cramer singles out NYX as the "cheapest stock," and he is bullish. He discussed the "tremendous buzz" about FCX's acquisition of PD, which enabled FCX to get copper exposure and PD to get gold exposure. In addition, Lundin Mining is the next copper play, according to Cramer. Allergan (NYSE: AGN - News), Research In Motion (NASDAQ: RIMM - News), Sears Holdings (NASDAQ: SHLD - News) - Although there is a lot of negativity about drug stocks with the Democrats controlling Congress, Cramer thinks that Allergan "may be in the early stages of an incredible run and is finally starting to get the recognition it deserves." The company makes effective silicon breast implants and also has Botox and Juviderm, the "No. 1 method of getting rid of wrinkles." Even though the stock recently jumped $7, Cramer thinks it could rise an additional $12 from $119.55. On another note, Cramer thinks that RIMM is going up and that investors should take advantage of the $1 dip in Sears to pick up at least one share at $172. Oregon Steel (NYSE: OS - News) and Nucor (NYSE: NUE - News) - Cramer thinks that the media owes investors an apology for keeping them out of steel when their reports of a glut "clobbered" the stocks as people sold them off in panic. The reporters failed to mention that the companies were selling at five to six-times earnings. Now it is too late to buy OS which was a "huge stock," Cramer said, and that most steel companies are going to be taken over except for Nucor.
Bulls:
Mastercard (NYSE: MA - News): Cramer says this stock is not finished going up, and he would buy MA "right here, right now."Prudential (NYSE: PRU - News): This stock has a good dividend, says Cramer.AIG (NYSE: AIG - News): Cramer calls this stock "the cheapest in the group" and says it should go higher.IBM (NYSE: IBM - News):The current lack of momentum in this stock is a "mistake," says Cramer who predicts that it will go from $93.45 to $120, but would sell some at $100.
Bears:
Motorola (NYSE: MOT - News): This company missed its quarter twice, and Cramer does not feel comfortable recommending it.Alcoa (NYSE: AA - News):"The most poorly run major American company," Cramer said and suggested selling.Ford (NYSE: F - News): Although Cramer was bullish on Ford at $7, he doesn't like its balance sheet, and in spite of the fact that he had confidence in CEO Alan Mullaly, Cramer predicts that Ford will get "hammered" if it reports another lackluster quarter.

Labels: AGN, AIG, IBM, IR, Jim Cramer, LMC, MA, NUE, OS, PD, PRU, RIMM, SHLD, YHOO

Freeport-McMoRan Copper & Gold Inc. said Sunday it will acquire the Phelps Dodge Corp. for $25.9 billion in cash and stock to create the world's largest publicly traded copper company.
The world's largest copper company in terms of production is Codelco, or Nacional del Cobre de Chile, owned by the country of Chile.
Richard C. Adkerson, president and CEO of Freeport-McMoRan, said the company has discussed joining with Phelps Dodge for years, but that it was just within the past few weeks that he and J. Steven Whisler, Phelps Dodge's CEO, began talking and laying the ground work for the "serious negotiations" that yielded the agreement.
The merger is still subject to shareholders and regulators. But Adkerson expects approval by the end of the first quarter of 2007.

Labels: Freeport-McMoRan Copper, PD, Phelps Dodge Corp.