Stocks discussed in the in-depth session of Jim Cramer’s Mad Money TV program, Thursday September 14. Click on a stock ticker for more analysis:
Best Buy climbed from $46 to $52 after reporting some "stellar numbers," and Cramer commented, "When you see a stock make a big move like that, you'll find pin action." He suggests looking at home theatres and although Sony comes to mind, Cramer doesn't think SNY is profitable right now. Instead, he likes LOGI which makes costly remote controls. Although this division of the company is small it is "growing fast," comments Cramer, and the remotes will effect LOGI's gross margins which will propel the stock. Harman makes speakers and while it is only a fraction of what this company produces, Cramer sees a bright future for HAR which is down because of the departure of its CEO. TUNE makes HDTVs and chips that allow users to watch TV on cellphones, but Cramer warns that it is a high-risk stock.
Related: David Jackson raises the question of whether Apple's new entertainment device will be a threat to Best Buy.
Defending Costco (NASDAQ:COST)
Since Costco reported lackluster numbers it has fallen from $57 to $50. However, Cramer believes that Costco is a broken stock and not a broken company and its weak performance is related to external factors and not to the company's fundamentals. First, the company did not meet its same-store sales estimates which is "awful" according to Cramer but is not a sign of a bad company. Costco revised its estimates downward because of slow sales in furniture and electronics. Cramer believes that this was related to the weak housing market which is not a long-term factor. Third, Costco might have suffered from sluggish consumer spending but this is related to the business cycle. However, Cramer believes that there is momentum in Costco and observes that it has solid growth strategies, its brand Kirkland is selling well and that it has a $2 billion buyback plan. Since it is still weak in electronics, Cramer gives Costco one and a half thumbs up.
Related: Asif Suria discusses the reasons he feels Costco could be a buy in the future.
Cramer suggests selling GS which is up 12 points since he discussed the stock last week. Although he would hang on to LM, conservative investors might want to sell some now. The Gap needs to be broken into three separate companies, said Cramer, and its estimates are too high. Hanson was recently upgraded by Goldman Sachs and Cramer suggests selling it.
Related: David Jackson notes the decline in Goldman Sachs' trading business.
CEO Interview: Paul Sagan, Akamai Technologies (NASDAQ:AKAM):
Explaining to the audience about his company, Paul Sagan said, "We provide air traffic control for the Internet. We control the way bits move around so we can ensure traffic gets through congestion and to your screen fast." When asked about the upcoming election season Sagan responded that it is a great opportunity for video on the internet and that it will be "driving broadband usage." He adds that the company has already developed high-definition video and that AKAM's quality, performance and security will continue to attract big customers.
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