Stocks discussed on the in-depth session of Jim Cramer's Mad Money TV Program, Friday February 22.
14 Things To Watch In The Week Ahead: Lowe's (LOW), Home Depot (HD), Darden (DRI), Hertz Global Holdings (HTZ), American Tower (AMT), Saks (SKS), AutoZone (AZO), Dollar Tree (DLTR), Groupon (GRPN), Joy Global (JOY), Best Buy (BBY), Kohl's (KSS), Deckers (DECK), VeriFone (PAY), Tesla Motors (TSLA), Zynga (ZNGA)
Lowe's (LOW) has been soaring on the housing comeback. Management should discuss how this trend is playing out.
Darden (DRI) has an analyst meeting. The stock has rallied even in the face of higher gasoline prices and the end of the payroll tax holiday. Cramer wants to hear how management will deal with these challenges.
Hertz (HTZ) has had a run-up in business post Hurricane Sandy. Cramer wants to hear if the upside can continue.
The Fed: Probably the most influential mover of stocks for the week will be Fed Chairman Ben Bernanke's address to the Senate on Tuesday. This will be a "tight rope walk," because if Bernanke is too positive on the economy, people will fear interest rate hikes, and if he is too negative, consumer confidence will be called into question.
Home Depot (HD) is a main player on the housing comeback thesis, and management should discuss more upside.
American Tower (AMT) is likely to blow out its quarter.
Saks (SKS) is in what Cramer calls the "Gatsby cohort" of high-end retail names. There has been mixed action in this sector, and it is crucial to hear what management says about the state of Saks' business.
AutoZone (AZO): Many are leaving this stock. Management should discuss the strength of the auto market.
Dollar Tree (DLTR) gave disappointing earnings last time around. Cramer wants to know if there will be any improvement.
Groupon (GRPN) is "clawing its way out of the cellar." Cramer thinks it will report better than expected earnings.
Joy Global (JOY) should give a fresh read on China, given conflicting reports about the state of China's economy.
Best Buy (BBY) could be the target of a leveraged buyout. The stock might continue a slow move higher, and management should talk about discretionary spending.
Kohl's (KSS) is also the subject of rumors of a leveraged buyout, but Cramer thinks this is less important that what Kohl's has to say about the consumer.
Deckers (DECK) pulled back on worries about inventory. Cramer likes the stock in the mid 30s, and while Deckers is currently in "no man's land," the worst could be behind it.
Cramer took some calls:
VeriFone (PAY) is not a stock Cramer likes. "Ixnay on this stock."
Tesla Motors (TSLA) is a "tough call" and a "hope stock." Cramer thinks those who hold the stock have seen a nice gain and should take some profits while "playing with the house's money."
Zynga (ZNGA) is a stock Cramer thinks has bottomed.
The market has been very forgiving of late, but has unfairly punished some stocks. Hewlett-Packard (HPQ), which declined by 40% last year, might finally have its day again, as CEO Meg Whitman is making convincing remarks about returning value to the company. Johnson & Johnson (JNJ) is involved in yet another recall of its products, and yet the stock is down only a penny on the news. Boeing (BA) is being taken to task over problems with its Dreamliner airplane, but the stock is up for the third straight day. Norfolk Southern (NSC) was pounded for its exposure to coal, but it seems that the worst is over, since NSC is rallying. FedEx (FDX) pre-announced that it would miss its quarter, but the stock has bounced on belief in an improving economy. Meanwhile, Apple (AAPL) is being treated as if it never created value for its shareholders, the bears are attacking the once victorious Whole Foods (WFM) and Coach (COH) has been taken out and shot. What emerges from this picture of a mixed market is that investors should not be quick to panic out of stocks that have temporary shocks, but they shouldn't assume the winners are going to continue to win.
Radian Group (RDN)
Radian Group (RDN) was a stock Cramer wouldn't have recommended going near a few years ago, since it deals with mortgage insurance. However, the stock seems to be bottoming, and the industry is likely to see some upside after the devastating housing crisis a few years ago. While some of its peers filed for bankruptcy, RDN stayed afloat and has been rallying dramatically, even doubling in the past few months. Even after this significant rise, the stock still trades at a modest $8. The company has tightened up its standards for mortgages, and 75% of its revenues will be derived from mortgages granted with these stricter rules. RDN's main competition, the Federal Housing Administration, says it will be less aggressive in pursuing mortgages, which is good news for RDN. Even though 29% of the stock is sold short and a Barron's article called RDN a "house of cards," Cramer thinks there is significant upside potential for RDN. "Radian can be radiant again," said Cramer.
InvenSense (INVN) is a stock Cramer wanted to stay away from, given the departure of its CEO and lowered guidance. However, the stock has rallied 35% since November, and Cramer admits he was too conservative with his earlier call on it. The stock may be a good trade now, but those who hold it should take some profits.
Computer Sciences (CSC) is always rumored to be a potential acquisition, but it hasn't happened yet. The stock faces challenges, including a decrease in government spending and excessive exposure to Europe. The stock has run 18%, and Cramer acknowledges, "We missed it. We were too late with this one."
Bloomin' Brands (BLMN) is a stock that has been on a run, up 56%. However, with risks of higher commodity costs and declining consumer confidence, the stock seems risky. Cramer would consider buying it under $16.
Johnson Controls (JCI) is a stock Cramer would consider only on a breakup.
VMware (VMW) reported a lackluster quarter. "I am tired of the big data theme," Cramer said. "Too many companies want to be in big data."
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