Cramer's Stop Trading! Raining on Macy's Parade (2/2/09)

Stocks discussed on Jim Cramer's Stop Trading! TV show, Monday February 2.

Macy’s (M), J.C. Penney (JCP), U.S. Steel (X)

Macy’s troubles are not surprising, because it has “been in trouble literally for years” and its business model of big department stores is a losing one. Macy’s announced it is letting go 4% of its workforce and cutting its dividend 5 cents. JC Penney, also a high-yielding retailer, may be in trouble too.

Even with domestic steel production cut in half, and U.S. Steel is seeing slow earnings and has a $5 billion pension problem, he questions the logic of a Goldman Sachs analyst who put it U.S. Steel on the conviction sell list at $26 when the stock was once as high as $196.

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Comments

[Scottinkga:]

Macys has simply gotten too big. This move was inevitable.

Feb 03 09:40 AM

[Tradememe:]

These businesses have been in trouble for years with or without a recession.

Feb 04 12:01 AM

[SANKAR KRIS...:]

we thought the same thing about JAYG..bot the stock and it went down multiple points..

Feb 04 09:34 AM

[Michael K:]

Goldman Sachs is simply manipulating the market with (X). Less than two months ago they had US Steel on their "Conviction Buy", and now suddenly, with no real change in the market other than the possible stimulus upside to steel, they have decided is a "Conviction Sell". That's until they can drive it back down to $26, when they'll call it a "Conviction Buy" again and wait until it hits $35 and repeat the process.

Feb 04 04:45 PM

[One of many:]

Macy's has given itself trouble ever since it became more interested in plastering its name on everything in sight rather working to provide the quality of products and services that customers actually want to buy.

Feb 04 05:12 PM