Cramer's Mad Money - Hail to the Chiefs (10/22/09)

Stocks discussed on the in-depth session of Jim Cramer's Mad Money TV Program, Thursday October 22.

McDonald's (MCD), Goldman Sachs (GS), JP Morgan (JPM), Ford (F), Apple (AAPL), J.Crew (JCG)

Sometimes the person whose hand is at the helm of a company makes all the difference when investors decide which stocks to buy. It is no accident that some of the most stable stocks have the most skilled CEOs: McDonald's (MCD) James Skinner, Goldman Sachs's (GS) Lloyd Blankfein, JP Morgan's (JPM) Jamie Dimon, Ford's (F) Alan Mullaly, and Apple's (AAPL) Steve Jobs. Cramer would add J.Crew's (JCG) Mickey Drexler to the list, "The greatest merchant of our lifetime." Cramer says Drexler is the CEO with an eye for "both fashion and inventory." The First Lady shops at J.Crew, and the company's brands keep rising in popularity. J.Crew boosted guidance and the stock price rose 15%.

Cramer reminded viewers that the CEO is the "special sauce" that adds flavor to a company and said investors should sometimes be willing to "pay up for greatness."

TriQuint Semiconductor (TQNT), Skyworks Solutions (SWKS), RF MicroDevices (RFMD)

TriQuint Semiconductor (TQNT) declined 28% after missing estimates, reducing guidance and reporting lower demand from a Korean client, which is believed to be Samsung. While Cramer regretted not telling viewers to take profits earlier, he thinks TQNT's losses are the result of its exposure to regular phones, rather than smart phones. The loss from Samsung can easily be recouped, especially since mobile internet is a "massive, multi-year theme" which will comprise much of the company's revenue. Skyworks Solutions (SWKS) and RF MicroDevices (RFMD), which were also dragged down because of TriQuint's results, are buys on this decline.

Nucor (NUE) CEO Dan DiMicco

Nucor reported a better-than-expected quarter; revenues increased 26%, earnings 78% and shipments 28%. DiMicco commented that a worse-than-expected jobs number is hampering economic recovery. Two weeks ago, Dan DiMicco appeared on Mad Money and said the government should concentrate on creating jobs. He reiterated these statements, and added the country needs 15 million new jobs just to break even. DiMicco thinks public-private partnerships are the best solution and urges the government to invest more in infrastructure.

Get out of Data Centers: Equinix (EQIX)

Equinix (EQIX) looks like an ideal stock: its earnings report included an upside surprise, its proposed acquisition of Switch & Data Facilities is receiving praise, its share price is $4 from its 52 week high, and no analysts who cover the stock recommend selling. But Cramer disagrees, because the data center business model is quickly becoming outdated. Intel (INTC) reported a new data processor that does the work of eight traditional data processors and will make outsourcing data unnecessary. “Get out of the data-center stocks,” Cramer said. “I see an industry that’s about to be brought low by new technology, so I think you should sell, sell, sell.”

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Comments

[herbert hoover]

May I offer an insight to the folks at Seeking Alpha?

NO ONE cares what Cramer thinks.

2009 Oct 23 09:06 AM

[J M Keyes]

I presume that you are the NO ONE to whom you refer.


On Oct 23 09:06 AM herbert hoover wrote:

> May I offer an insight to the folks at Seeking Alpha?
>
> NO ONE cares what Cramer thinks.

2009 Oct 23 10:24 AM

[Dave Harris]

Cramer is right about one thing, of that I am sure. Ford's Alan Mulally is a superior CEO. Watch and see.

2009 Oct 23 11:41 AM