Stocks discussed on the in-depth session of Jim Cramer's Mad Money TV Program, Monday September 9.
"One word: Optical," said Cramer, referring to the fact that telco equipment is a hot sector right now. Cisco (CSCO) seemed to negate this, and management's muted statements kept a lid on telco equipment stocks. One reason Cisco's management was so cautious is that it is laying off thousands of employees. Ciena (CIEN) has had a huge move up, and is one of the few stocks in the sector reflecting the increase in telco spending. Finisar (FNSR) reported a strong quarter. Other telco equipment stocks that haven't yet moved and might be worth buying are Alcatel Lucent (ALU), which Cramer says is "one of the most exciting speculations in the world right now," JDS Uniphase (JDSU), Juniper (JNPR) and Xilinx (XLNX).
Ford (F), Eaton (ETN), Caterpillar (CAT), Cummins (CMI), Cisco (CSCO), Google (GOOG), General Motors (GM), General Electric (GE), Nike (NKE), FedEx (FDX), Yum Brands (YUM), Lululemon (LULU), Ocwen (OCN), Prudential (PRU), AIG (AIG), Apple (AAPL)
While many investors are concerned about interest rates, the Fed's tapering policy and uncertainty about Syria, the comeback in Europe and China is real and will send stocks higher. Ford (F), which was hurt by weakness in Europe, may be headed higher as well as Eaton (ETN), which was upgraded recently. Caterpillar (CAT) has been a poor performer lately and many felt it was a good short. Any slightly improved news about orders may send CAT up 10%. Apple (AAPL) was clobbered by analysts during its previous earnings because of weakness in Chinese orders; its cheaper iPhone may be a solution to that problem. Joy Global (JOY) reported a "hideous" number but has risen $1 since then; JOY seems to have bottomed. Other companies that will see upside with improvement in Europe and China include: General Motors (GM), General Electric (GE), Yum (YUM), Cisco (CSCO), Google (GOOG), FedEx (FDX), and Nike (NKE)
Cramer took some calls:
Lululemon (LULU) received an upgrade, and the charts indicate a move higher, but Cramer would wait to buy until he sees the transition to the new CEO. This might mean missing a few points, but Cramer wouldn't jump into LULU right now.
Ocwen (OCN) is "in the sweet spot," and is going much higher.
CEO Interview: Clay Siegall, Seattle Genetics (SGEN)
Seattle Genetics (SGEN) is a stock that has gone higher on the strength of its main drug, Adcetris for Hodgkins Lymphoma. The drug is currently being studied in 20 clinical trials for additional applications. CEO Clay Siegall said Adcetris is "like a pipeline itself." The company specializes in antibody-based treatments that target cancer cells and leave healthy cells alone. Its T-cell Lymphoma drug has a higher success rate than the main treatment. The company has partnerships with major players in pharma and reaps the benefits of royalty fees. The stock has risen 88% since Cramer first recommended it.
CEO Interview: Emmanuel Chirico, Phillips-Van Heusen (PVH)
Phillips-Van Heusen (PVH) reported a 2 cent earnings beat with a 46% increase in sales, but its guidance was downbeat. PVH CEO Emmanuel Chirico sees strong volatility and a lack of consistency from consumers; July was weak, August was strong and September seems to be weak again. Back to school was not so strong and the Calvin Klein jeans segment needs to be revamped. Trends in Northern Europe look better, but PVH is still suffering from weakness in Italy and Spain. Ultimately, Chirico cited the "general malaise in the apparel sector" as a reason for concern, although the stock has risen 19% since June and the Speedo and Izod brands were particularly strong globally. "It was a great quarter and that does matter," said Cramer.
CEO Interview: Russell Goldsmith, City National (CYN)
City National (CYN) is a bank that focuses on wealth management and has a substantial mortgage segment. The company reported a strong quarter, has risen 36% but has pulled back 5 points recently. CEO Russell Goldsmith discussed loan growth and new clients. The rise in interest rates might actually increase demand for mortgages, as people decide to get a mortgage before rates go even higher. Although rates are rising, they are still historically low. Cramer commented that CYN is a high quality bank with very low delinquency rates; "They don't do the crazy things other banks do. CYN just makes money."
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