Stocks discussed in the in-depth session of Jim Cramer’s Mad Money TV program, Thursday June 29. Click on a stock ticker for more analysis:
Note: The following is a recap of show that was broadcast in April. There is no 'Lightning Round'.
Go for the Burn: DJ Orthopedics (DJO)
Since baby boomers are trying to get in shape to ward off the effects of aging, Cramer sees a potential for orthopedic products, such as knee and ankle braces. He picks DJO, which recently acquired Aircast Incorporated,"the Moby Dick of knee accessories," and the stock has jumped 13.5% to nearly $40 after the deal. However, Cramer would wait for a pullback before picking up DJO. If it earns $2 a share, Cramer suggests taking the stock to $46.
Reading Between the Lines: Mindspeed Technologies (NASDAQ:MSPD)
Cramer admits that he was wrong when he suggested buying MSPD in March, based on an article he read in The Washington Post. He believed that the company, which supplies processors and fiber to the premises, or FTTP, necessary for VoIP, would benefit from the successes of Finisar (NASDAQ:FNSR), JDSU (JDSU) and Broadwing (BWNG), and since it was down 10%, he thought it was a good buy. He suggests reading between the lines when it comes to stocks.
Going to the Extreme: Zumiez (NASDAQ:ZUMZ):
Cramer notes the rising popularity of "extreme" sports, such as snowboarding, and picks Zumiez, since it "stands up to the homework test." The company has reported October same-store sales growth of 10%, a 29% increase in sales, and that it is expanding stores into the Midwest and East. The fact that people have to drive a long way to ski has not hurt the stock, in spite of high gas prices: "If Zumiez can do this kind of growth in an environment where gas is expensive, just imagine how well it will do as the price of gasoline comes down," Cramer said.
Short Sell List:
Cramer commented on a Wall Street Journal article about the advantages of betting against short-sellers, adding; "there's money to be made...but only when (the stocks) are good ones." He analyzed the article's list of the most heavily shorted stocks.
1. Accredited Home Lenders (LEND): Cramer believes that this stock will go lower.
2. OmniVision Technologies (NASDAQ:OVTI): This company missed its estimates for two straight quarters, and Cramer comments, "I don't like it."
3. Red Robin Gourmet Burgers (NASDAQ:RRGB): At 32 times earnings forecasts, Cramer says this stock is "absurdly expensive."
4.Calpine (NYSE:CPN): Cramer says this stock will continue to go lower.
5. Martha Stewart Living Omnimedia (NYSE:MSO): Cramer believes this stock is overvalued because of "Martha hype."
6.Winnebago Industries (NYSE:WGO): Cramer says the shorts can expect some number cuts.
7. Beazer Homes (NYSE:BZH): "I'd be short the homebuilders if I was at my fund right now."
8. Eagle Materials (NYSE:EXP): Cramer would do a 'mon back on this stock, saying that the shorts are wrong. He praises the company's increase in prices, cashflow and buyback, but adds that they have the "high quality problem" of not being able to keep up with demand. The only thing that worries Cramer about EXP is the possible repeal of the tariff on Mexican cement imported to the U.S
Cramer called UPS the "obvious pin action play" as retail sales on the internet continue to grow, and notes that advertising dollars are being transferred from newspapers to Google and Yahoo! He also likes FDX, placing it second behind UPS. Cramer is bearish on AMZN, which is now facing stiff competition and is being "eaten alive by shipping costs."
Seeking Alpha publishes a summary of Jim Cramer's stock picks every day