Cramer's Mad Money - The Good, the Bad and the Ugly (1/30/09)

by: Miriam Metzinger

Stocks discussed on the in-depth session of Jim Cramer's Mad Money TV Program, Friday January 30.

The Good, the Bad and the Ugly: Google (NASDAQ:GOOG), IBM (NYSE:IBM), Motorola (MOT), Research in Motion (RIMM), Qualcomm (NASDAQ:QCOM), Honeywell (NYSE:HON), Jetblue (NASDAQ:JBLU), Micron Technology (NASDAQ:MU), Edison International (NYSE:EIX), Con Edison (NYSE:ED), Duke Energy (NYSE:DUK), Verizon (NYSE:VZ), AT&T (NYSE:T), Xerox (NYSE:XRX), Eastman Kodak (EK), Applied Materials (NASDAQ:AMAT), Corning (NYSE:GLW), Aetna (NYSE:AET)

Obama gathered 12 CEOs to approve his stimulus plan, and Cramer wonders if their companies’ association with the Obama Administration may help or hurt them in the long run, and if their stock is worth buying. Cramer donned his cowboy hat and did his best Clint Eastwood impersonation as he discussed “The Good, the Bad and the Ugly” among the twelve.

  1. Google (CEO, Eric Schmidt) is cheap, reported a strong quarter and is a healthy company – Good
  2. IBM (CEO, Sam Palmisano) is a buy right here, said Cramer, after the company had a good quarter and gave solid guidance. Good.
  3. Motorola (CEO, Greg Brown). “That stock has hurt more people than any other stock I know,” said Cramer. Instead, he would buy Research in Motion or Qualcomm. Motorola is Ugly.
  4. Honeywell (CEO, David Cote) is one of the few industrials that is still doing well. Cramer would buy, even though the company expects a tough 2009. Good.
  5. Jetblue (CEO, David Barger) is not a buy. Cramer has a policy of not recommending airline stocks, and Jetblue is no exception. Ugly.
  6. Micron Technology (CEO, Steve Appleton) “is one of the worst stocks in the book.” Ugly.
  7. Edison International (CEO, John Bryson). Cramer only likes utilities that offer a good dividend. Instead, Cramer would choose Con Edison, Duke Energy, Verizon or AT&T. Edison International is Bad.
  8. Xerox (CEO, Anne Mulcahy) is “a complete and utter disaster.” Ugly.
  9. Eastman Kodak (CEO, Antonio Perez) is in doubt with its troubled hardware, digital and printer divisions, a shaky dividend and lots of debt. Ugly.
  10. Applied Materials (CEO, Michael Splinter) products are not in demand anymore. Its solar division is in trouble because of lower oil and gas prices. Bad.
  11. Corning (CEO, Wendell Weeks) makes glass for LCD TVs. Cramer sees falling demand for Corning’s products. Bad.
  12. Aetna (CEO, Ron Williams) Aetna and the entire health care maintenance space has had a run. Bad.

Mad Money Guest: North Dakota Senator Kent Conrad

Like Cramer, Senator Kent Conrad is also disappointed in President Obama’s stimulus plan that passed the House on Wednesday. The plan has only $30 billion earmarked for infrastructure, while Senator Conrad thinks $200 billion is more in order. There isn’t enough aid for financials and housing, sectors that are still in trouble. “If they don’t get well,” Conrad said, “we can’t have economic recovery.” He has some plans for the bill when it finds its way through the senate; a $10,000 tax break for homeowners, ways to re-negotiate at-risk mortgages and prosecutions to nab those who created the current mess.

Mad Mail: Retention Bonuses and Housing

Cramer told one viewer that he has no qualms with generous retention bonuses for executives provided that they aren’t given with TARP funds; ”If you’re going to ask for money from the government, you’ve got to give in and not take the money and line your pockets – shame.” Cramer reiterated his housing solution. First, the supply of houses has to go down. Second, a tax credit should be given to homebuyers, and third, “We have to forebear on the banks. Don’t make them sell property until we see prices rising.”

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