Stocks discussed on the in-depth session of Jim Cramer's Mad Money TV Program, Monday December 3.
Ulta Salon (ULTA), Tractor Supply (TSCO), Gilead (GILD), Alexion (ALXN), Diageo (DEO), Amazon (AMZN), Google (GOOG), MasterCard (MA), Visa (V), Sherwin Williams (SHW). Other stocks mentioned: Home Depot (HD)
Cramer revisited 10 growth stocks he "anointed" a few months ago to see if they are still worth buying or holding onto, especially given fiscal cliff concerns:
Ulta Salon (ULTA) saw a resignation of its CFO mid-October. Cramer doesn't think management departing is a good sign, but the stock reported a same store sales increase of 8.4% and the stock shot up 7%. Ulta is increasing its store count and says numbers for the holidays look good. Cramer would wait for a dip to buy.
Tractor Supply (TSCO) has been a less successful pick, mainly because expectations were too high. The stock is $10 below where Cramer recommended it. The quarter was impressive and TSCO had tough comparisons to beat. Housing is coming back and TSCO is taking market share, but it is too hated by The Street right now to be a strong buy. Cramer prefers Home Depot (HD) as a play on housing.
Gilead (GILD) has HIV and Hepatitis C treatments that look promising. The stock rose 8% on promising results from its Hepatitis C drug, and this treatment might be approved by the middle of the year. The stock still looks promising.
Alexion (ALXN) has been a disappointment, and is down 14% from where Cramer recommended it. ALXN has a treatment for a rare blood condition, but the stock sold off because ALXN merely met, but did not beat expectations. While Cramer thinks the market over-reacted, he would not jump into the stock.
Diageo (DEO) is up 4% and yields 2.8%. The company has a 5% organic growth increase and is moving into emerging markets, particularly India. Cramer is bullish on DEO.
Amazon (AMZN) pulled back but has risen with a vengeance. The company still controls ecommerce; 20% of online sales in the U.S. are through Amazon, but it still has huge growth potential internationally. The Kindle is selling well, and with the closing of brick and mortar retailers due to Sandy, AMZN continued to take market share in November.
Google (GOOG) got crushed after it reported a disappointing quarter. The culprit was mobile, since GOOG makes less money on mobile ads. Cramer is confident that GOOG can find a solution, but until it reports a strong quarter, GOOG is in the penalty box.
Sherwin Williams (SHW) sold off on the quarter and is a victim of huge expectations, since it had run up 70% for the year. SHW is a terrific play on the housing rebound, and has acquired a Mexican paint company. Cramer still likes SHW.
Deckers (DECK) used to be a growth stock Cramer liked, but it has been a poor performer so far this year. People thought the Ugg boot and Teva sandal trend had passed, and the stock has made a straight line downward. DECK is up 10% on an upgrade and has been working its way higher since it bottomed in October. Cramer thinks the stock might have been punished enough. One reason for the decline was the rise in sheepskin prices, and DECK had to pass higher prices onto customers. Now that sheepskin prices are declining, DECK should see improved gross margins. In addition, DECK could be a takeover target for VFC, which has made a successful acquisition of Timberland. If VFC acquires DECK, it is likely to pay a 20% premium. Cramer doesn't usually recommend speculating on possible takeovers, but he doesn't think DECK is as bad as it has been so far this year. For those who want to invest, he would buy half a position now and wait for a pullback to buy the other half.
Was Goldman Sachs Right To Upgrade Dell (DELL)?
Goldman Sachs upgraded Dell (DELL) from sell to buy, and at first, Cramer dismissed the upgrade as "sophistry." However, the target was not outrageously high; from $9 to $13. While everything is going mobile, there is so much negativity about Dell at a time when the company is brimming with cash and could find solutions to its problems. In addition, it is possible that Dell might take itself private. Cramer thinks that those who want to speculate on Dell can do so, but should use caution.
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